Document:

EXHIBIT 10.3

PORTIONS OF THIS EXHIBIT MARKED BY *** HAVE BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.

     LICENSE AGREEMENT made as of this 21st day of June, 2004, by and between
MICHAEL KORS, L.L.C., a limited liability company existing under and by virtue
of the laws of the State of Delaware, with offices at 11 West 42nd Street, 10036
("Licensor") and WARNACO SWIMWEAR PRODUCTS INC, a Delaware corporation with
offices at 6040 Bandini Boulevard, Los Angeles, California 90040 ("Licensee").

                                    RECITALS

     A. Michael Kors is a world-famous designer of women's and men's apparel and
accessories;

     B. Licensor has the sole and exclusive rights in the trademark MICHAEL KORS
and variations thereof, including the right to license third parties; and

     C. Licensee wishes to obtain, and Licensor wishes to grant to Licensee, an
exclusive license for the manufacture, sale, distribution and promotion of
"Licensed Products" (hereinafter defined) upon the terms and conditions set
forth herein.

     NOW, THEREFORE, for good and valuable consideration including the mutual
agreements contained in this Agreement, the parties agree as follows:

1. DEFINITIONS

     1.1 "ADVERTISING CONTRIBUTION" shall have the meaning set forth in Section
6.1.

     1.2 "AFFILIATE" shall mean, with respect to either party, any association,
corporation, partnership, joint venture or other entity a majority of whose
issued and voting shares or equity interest is owned or controlled directly or
indirectly by, or is under common control with such party, or owns or controls a
majority of the voting shares or equity interest directly or indirectly of such
party.

     1.3 "BETTER" shall mean, with respect to market segments for apparel and
accessories, the quality and price segment relating to a secondary line of
apparel and accessories, as that term is understood in the trade, which is
typically sold at price points and is considered to be of a level of quality
below Bridge. The term Better shall not include or be read to incorporate any
market segment that is typically considered to be above Better, such as Bridge,
gold range or Designer Collection.

     1.4 "BUSINESS PLAN" shall have the meaning set forth in Section 5.2.

                                                          CONFIDENTIAL TREATMENT

     1.5 "CONTRACT YEAR" shall mean any twelve (12) month period from July 1
through June 30 when this Agreement is in full force and effect, except that the
first Contract Year shall commence on the date of this Agreement and end on June
30, 2006.

     1.6 "DESIGN CALENDAR" shall have the meaning set forth in Section 4.1.

     1.7 "DESIGNER COLLECTION" shall mean, with respect to market segments for
apparel and accessories, the quality and price segment of apparel and
accessories relating to the men's and women's designer collection lines of
high-end fashion designers, which typically is sold at price points and is
considered to be of a level of quality higher than Bridge and gold range. The
term Designer Collection shall not include or be read to incorporate any market
segment that is typically considered to be below Designer Collection, such as,
by way of example, gold range, Bridge, Better and/or sportswear.

     1.8 "DISCOUNTED GOODS" shall mean all Licensed Products which are (a) sold
to approved off-price accounts as listed on Schedule 5.4(b) hereto, as it may be
amended from time-to-time, (b) Seconds, end-of-season excess inventory or
returns, or (c) sold by Licensee at a wholesale price which is *** less than the
prevailing wholesale price at which Licensee has sold, at the beginning of each
selling season, a significant volume of such Licensed Products to approved
accounts listed on Schedule 5.4(a) hereto, as it may be amended from
time-to-time. "NON-QUALIFIED DISCOUNTED GOODS" shall mean all Discounted Goods
sold in each Contract Year in excess of *** of the total units of Licensed
Products sold by Licensee in such Contract Year.

     1.9 "DUTY FREE" shall mean any store or other channel of trade in which
goods are sold free of any national tariffs, duties or taxes on the condition
that the purchaser will not bring such goods back into the country (or
designated country of origin) in which they are purchased.

     1.10 "GROSS SALES" shall mean the invoiced amount of Licensed Products
shipped by Licensee before any deductions whatsoever, including, without
limitation, for discounts and returns, insurance and freight.

     1.11 "GUARANTEED MINIMUM NET SALES" shall have the meaning set forth in
Section 7.3.

     1.12 "GUARANTEED MINIMUM ROYALTY" shall have the meaning set forth in
Section 7.2.

     1.13 "IP RIGHTS" shall mean all copyright and trade dress rights, other
than rights in the Trademarks, now or hereafter owned by Licensor in and to any
designs, fabrics, patterns, prints, labels, advertising and materials used in
conjunction with the Licensed Products, whether created by or on behalf of
Licensor or Licensee; provided, however, that IP Rights shall specifically
exclude all such designs, fabrics, fabrications, silhouettes, patterns and
materials that are commonly used on Products, including (i) generic features and
(ii) those features used by

                                                          CONFIDENTIAL TREATMENT

Licensee on Products sold by Licensee under other names, marks and brands
(collectively, "Common Elements").

     1.14 "LICENSE" shall mean the right to manufacture, and, in the Territory,
the exclusive right to sell, distribute and promote Products under the MICHAEL
KORS trademark in the Designer Collection market segment and under the MICHAEL
MICHAEL KORS trademark in the Better market segment, and the non-exclusive right
to use the IP rights in connection therewith.

     1.15 "LICENSOR MARKS" shall mean MICHAEL KORS, KORS, KORS MICHAEL KORS,
MICHAEL MICHAEL KORS, MK MICHAEL KORS and the MK logo, and variants of any of
the foregoing marks.

     1.16 "LICENSED PRODUCTS" shall mean Products bearing any Trademarks.

     1.17 "LICENSOR RETAIL STORES" shall mean freestanding specialty and outlet
stores, in-store concessions, and direct-to-consumer operations (including
Internet e-commerce sites and direct mail operations) under the Trademarks,
whether operated by Licensor or any of its Affiliates or licensees.

     1.18 "MARKETING OBLIGATION" shall have the meaning set forth in Section
6.2.

     1.19 "NET SALES" shall mean Gross Sales of Licensed Products, sold by
Licensee or its Affiliates, at wholesale basis in arms-length transactions to
independent wholesalers and retailers and Licensor Retail Stores, less: (a)
actual credits for returns; (b) actual, reasonable and normal trade discounts,
markdowns and allowances (excluding co-op advertising); and (c) all taxes
collected by Licensee from, and payable by, the purchaser of the Licensed
Products pursuant to applicable law to the extent such taxes are stated
separately on the invoices and included in Gross Sales. Total deductions from
Gross Sales for items listed in (a) and (b) above shall not exceed *** of Gross
Sales in any Contract Year. No other deductions shall be taken. It is the
intention of the parties that royalties will be based on the bona fide wholesale
prices at which Licensee or its Affiliates sell Licensed Products to independent
wholesalers and retailers in arm's-length transactions. Further, in the event
Licensee shall sell Licensed Products to its Affiliates that are retailers,
royalties shall be calculated on the basis of such bona fide wholesale prices
irrespective of Licensee's internal accounting treatment of such sales. If the
invoiced amount of the Licensed Products sold and delivered by Licensee is in
currencies other than U.S. dollars, the invoiced amount shall be converted into
U.S. dollars at the exchange rate of Citibank, New York, New York on the last
day of the month immediately preceding the date of determination of such Net
Sales.

     1.20 "NEW ACCOUNT APPROVAL FORM" shall have the meaning set forth in
Section 5.4.

     1.21 "PERCENTAGE ROYALTY" shall have the meaning set forth in Section 7.1
hereof.

     1.22 "PRODUCTS" shall mean women's swimwear, including, without limitation,
one and two-piece bathing suits, suit separates, and, subject to the rights of
any third-party licensees

of Licensor, coordinating swim cover-ups and swim accessories developed and sold
in conjunction with swimwear and sold to swimwear buyers, or for display and
sale in an area of a store in which swimwear is separately displayed and sold,
even if such store does not have a separate swimwear buyer. Products bearing the
"MICHAEL KORS" trademark are sometimes referred to herein as "Collection
Products", and products bearing the "MICHAEL MICHAEL KORS" trademark are
sometimes referred to herein as "Better Products".

     1.23 "SAMPLES" shall mean prototypes, runway samples and selling samples of
Licensed Products.

     1.24 "SECONDS" shall mean damaged, imperfect, non-first quality or
defective Products.

     1.25 "TERM" shall have the meaning set forth in Article 3 hereof.

     1.26 "TERRITORY" shall mean the entire world, excluding Japan.

     1.27 "TRADEMARKS" shall mean the trademark MICHAEL KORS, MICHAEL MICHAEL
KORS and, subject to Licensor's prior written approval on a case-by-case basis,
all variations and combinations of the foregoing marks.

     1.28 "ZONE" shall mean the physical retail selling area designated by
department stores for a particular product type or classification (e.g., coats,
scarves, swimwear, etc.).

2. LICENSE GRANTED

     2.1 LICENSE GRANT. In accordance with the terms and conditions of this
Agreement, Licensor hereby grants to Licensee, and Licensee hereby accepts, the
License.

     2.2 RIGHTS NOT GRANTED. This Agreement is not an assignment or grant to
Licensee of any right, title or interest in or to the Trademarks or IP Rights,
other than the grant of rights to use the Trademarks and IP Rights in connection
with Licensed Products in the market segments in the Territory specifically set
forth herein. Licensee acknowledges that Licensor, its Affiliates,
manufacturers, and/or licensees may, without violating Licensee's rights
hereunder, distribute, sell, advertise and promote in the Territory: (i)
Products in any market segment other than the Better and Collection segments
under any trademarks other than the Trademarks, and (ii) any products other than
Products under the Trademarks or any other trademarks in the Territory. Licensee
further acknowledges that Licensor, its Affiliates and licensees may: (i)
distribute, sell, advertise and promote Licensed Products bearing the Trademarks
at Licensor Retail Stores in the Territory pursuant to the terms hereof and (ii)
manufacture or authorize the manufacture of Licensed Products in the Territory
for sale exclusively in Japan. Licensee shall not have the right to operate
free-standing retail stores, in-store concessions, Internet e-commerce sites or
any other direct-to-consumer business under the Trademarks (except as approved
in advance by Licensor). Licensor expressly retains the right to operate, either
directly or through its Affiliates or licensees, such retail stores, in-store
concessions and/or Internet e-commerce sites and other

direct-to-consumer businesses. All rights not specifically granted herein to
Licensee are reserved to Licensor, which may at all times fully and freely
exercise the same.

     2.3 COOPERATION WITH JAPANESE LICENSEE. Licensee acknowledges that Licensor
has granted rights with respect to Products in Japan to a third party licensee
(the "Japanese Licensee"). Licensee shall fully cooperate with the Japanese
Licensee as requested by Licensor, including, without limitation, by providing
at cost to the Japanese Licensee any and all designs, sketches, hardware,
specifications, Samples, and any and all other materials developed or used in
connection with the Licensed Products pursuant to this Agreement, at the same
time any such materials are developed in connection with Licensee's business;
provided, however, that Licensee shall only be required to provide such
cooperation to the extent that the Japanese Licensee provides reciprocal
cooperation to Licensee.

     2.4 FIRST REFUSAL RIGHTS. If, at any time during the Term, Licensor decides
to launch (i) a line of children's Products under the Trademarks or any other
trademark that includes or makes reference to Michael Kors, separate from a line
of childrenswear, ("Children's Products"), or (ii) a new line of Products in any
market segment other than the Better or Collection segments under any trademarks
other than the Trademarks that includes or makes reference to Michael Kors (a
"New Line"), Licensor shall notify Licensee of such intention (a "First Refusal
Notice") and, subject to the terms of this Section 2.4, Licensee shall have the
exclusive right of first negotiation to become the exclusive licensee therefor.
Licensee shall have thirty (30) days from its receipt of a New Line Notice to
present to Licensor a commercially reasonable business plan for the sale,
distribution and/or promotion in the Territory of the Children's Products or New
Line (a "First Refusal Business Plan"). Any such First Refusal Business Plan
shall include at least all of the information required to be set forth in the
Business Plan pursuant to Section 5.2, and shall provide for Licensee to launch
such Children's Products or New Line no later than twelve (12) months after
Licensor's approval of such First Refusal Business Plan. If (i) Licensee does
not present such a First Refusal Business Plan to Licensor within thirty (30)
days of receiving a First Refusal Notice, (ii) Licensor does not approve of such
First Refusal Business Plan and Licensee and Licensor, each acting in good
faith, are unable within thirty (30) additional days to agree on a mutually
acceptable First Refusal Business Plan, or (iii) Licensor and Licensee are
unable to agree on the specific terms of a license in respect of such Children's
Products or New Line and execute a definitive agreement with respect thereto
within thirty (30) days after Licensor approving or the parties mutually
agreeing upon a First Refusal Business Plan, then Licensee's rights with respect
thereto shall lapse. If the First Refusal Business Plan submitted by Licensee is
approved by Licensor or thereafter modified and agreed upon, then Licensor and
Licensee shall negotiate in good faith the specific terms of a license with
respect to such Children's Products or New Line, which may be in the form of
either an amendment to this Agreement or a separate agreement, as determined by
Licensor. Notwithstanding anything to the contrary contained herein, Licensee's
rights hereunder shall not apply to Children's Products in the event Licensor
directly or by a third party licensee wishes to launch a line of childrenswear
that includes Children's Products.

                                                          CONFIDENTIAL TREATMENT

3. TERM OF AGREEMENT.

     3.1 INITIAL TERM. Subject to the provisions of Article 9 hereof, this
Agreement shall be for an initial term (the "Initial Term") starting as of the
date of this Agreement and ending on June 30, 2008, unless the Agreement is
renewed for a "Renewal Term" as defined in Section 3.2 hereof (the Initial Term
and each Renewal Term being referred to collectively herein as the "Term"). The
period starting as of the date of this Agreement through June 30, 2006 shall be
deemed the first Contract Year of this Agreement. Each subsequent Contract Year
shall be a twelve (12) month period starting on July 1 and ending on June 30.
Licensee shall launch the sale of Licensed Products for the Cruise 2006 season
(shipping October 2005). It is expressly understood that only the company (which
may be Licensee) whose licensed term covers the period subsequent to the
expiration of the Term shall be entitled to receive designs for Licensed
Products intended to be sold after the expiration of the Term, and to make
presentations of such Licensed Products during the market presentation weeks
that relate to such subsequent period, even if such market presentation occurs
prior to the expiration of the Term. Without limiting the generality of the
foregoing, in the event the Term is not renewed or extended, the last season for
which Licensee shall be entitled to receive designs and, during the term hereof,
to manufacture and sell Licensed Products shall be the Cruise season immediately
preceding the expiration of the Term, and Licensor shall at all times be
entitled to undertake, directly or through a successor licensee, all activities
associated with the design, manufacture and sale of Licensed Products commencing
with the following season.

     3.2 RENEWAL TERMS. Provided that (i) Licensee is not in breach of this
Agreement and (ii) Net Sales of Licensed Products for the twelve (12) month
period ending June 30, 2007 are at least *** (the "First Renewal Volume"),
Licensee shall have the option to extend the term hereof for an additional three
year term ending June 30, 2011 (the "First Renewal Term"). In order to exercise
such renewal option, Licensee shall give Licensor written notice, on or before
May 1, 2007, that: (i) Licensee desires to exercise such renewal option, and
(ii) Licensee believes in good faith that it will have achieved the Renewal
Volume as of June 30, 2007. In the event Licensee gives such notice, but does
not in fact achieve the Renewal Volume, such notice shall be null and void, and
unless Licensor and Licensee agree to the contrary in writing, the Term shall
expire on the last day of the Initial Term, subject to Section 9.6 hereof. If
Licensee exercises its rights hereunder with respect to the First Renewal Term,
provided that (i) Licensee is not in breach of this Agreement and (ii) Net Sales
of Licensed Products for the twelve (12) month period ending June 30, 2010 are
at least ***, of which not less than *** consists of Net Sales of Collection
Products (the "Second Renewal Volume"), Licensee shall have the option to extend
the term hereof for an additional three year term ending June 30, 2014 (the
"Second Renewal Term"). In order to exercise such renewal option, Licensee shall
give Licensor written notice, on or before May 1, 2010, that: (i) Licensee
desires to exercise such renewal option, and (ii) Licensee believes in good
faith that it will have achieved the Second Renewal Volume as of June 20, 2010.
In the event Licensee gives such notice, but does not in fact achieve the Second
Renewal Volume, such notice shall be null and void, and unless Licensor and
Licensee agree to the contrary in writing, the Term shall expire on the last day
of the First Renewal Term, subject to Section 9.6 hereof.

                                                          CONFIDENTIAL TREATMENT

4. PRODUCTION; APPROVALS AND QUALITY CONTROL.

     4.1 DESIGN CALENDAR. Attached hereto as Schedule 4.1 is a calendar for the
design and production of the Licensed Products in any given Contract Year (the
"Design Calendar"). The Design Calendar may be amended from time to time by
agreement of the parties. During each Contract Year of this Agreement, Licensor
and Licensee shall use commercially reasonable best efforts to effectuate the
design and production of the Licensed Products in accordance with the Design
Calendar.

     4.2 DESIGN OF LICENSED PRODUCTS. For each Contract Year, four seasons of
each of Collection Products and Better Products (Early Cruise, Cruise, Spring
and Summer) shall be designed at Licensee's sole cost and expense by a designer
employed by Licensee. Such designer shall (i) be subject to Licensor's
pre-hiring approval and continuing approval throughout the Term, (ii) be
exclusively dedicated to the design of Licensed Products and (iii) supported by
an appropriate design staff. In accordance with the Design Calendar, Licensor
shall provide to Licensee the overall concepts and inspiration for each season's
collection of Licensed Products, and Licensee shall design the Licensed Products
in conformity with such seasonal concepts and inspiration. Further, from time to
time Licensor may submit to Licensee ideas, sketches, and/or designs for
individual Licensed Products. Licensee shall promptly create Samples of all such
Licensed Products for Licensor's review and approval, and, at Licensor's sole
discretion, any or all such individual Licensed Products shall be included in
the seasonal collection of Licensed Products that Licensor shall indicate. Any
and all materials that Licensor may provide to Licensee or use in connection
with such seasonal concepts and inspiration, or otherwise in connection with the
design of the Licensed Products, shall remain the sole property of Licensor and
shall be used by Licensee solely in connection with the Licensed Products;
provided, however, that nothing shall interfere with or prevent Licensee's use
of any Common Elements. Licensor may purchase items to be used as inspiration
for Licensor's design direction, and Licensee shall reimburse Licensor for the
reasonable cost of all such inspiration items promptly upon Licensor's
submission to Licensee of receipts for the purchase thereof, up to an annual cap
of ***. Licensee shall submit all designs for the Licensed Products and all of
the specifications relating thereto (including, without limitation,
specifications as to fabric and trim) to Licensor for approval in accordance
with the Design Calendar, together with a written request for design approval in
a form approved by Licensor. All designs created or used in connection with the
Licensed Products are expressly included in the IP Rights and shall be
exclusively owned by Licensor, including those created by Licensee. Nothing
herein shall prevent Licensor from using any such designs in connection with
other products of Licensor aside from the Licensed Products.

     4.3 PRODUCTION OF SAMPLES AND FINISHED LICENSED PRODUCTS. In accordance
with the Design Calendar, Licensee shall at its sole cost and expense create for
Licensor's inspection and approval Samples of the Licensed Products included in
each seasonal collection, which Samples shall conform to the designs and
specifications approved by Licensor pursuant to Section 4.2. Licensee shall be
solely responsible, at Licensee's sole cost and expense, for obtaining all
materials required for the manufacture of Licensed Products. For each season
Licensee shall exhibit Samples of all of the Licensed Products to Licensor in a
first prototype review, a second prototype review and a final line review. Each
such review shall be held in New York, New York. Licensee shall not manufacture
or offer for sale, distribute or promote any finished

Licensed Product until Licensor has approved the Sample of such Licensed Product
pursuant to a final line review. After Licensor has approved a Sample pursuant
to a final line review, Licensee shall not alter any characteristic thereof
(whether as to design/aesthetics, or as to fabrication or fit) in the production
of finished Licensed Products corresponding thereto without the prior approval
of Licensor. In accordance with the Design Calendar, Licensee shall submit
manufacturing samples from the first production run of each of the Licensed
Products to Licensor for approval, which approval shall not be unreasonably
withheld or delayed based upon conformity to the previously approved Samples.
Licensor's approval of any Licensed Product for a particular seasonal collection
shall not constitute an approval of the use of such Licensed Product for any
other seasonal collection. For each seasonal collection of Licensed Products
approved by Licensor, Licensee shall submit to Licensor a complete set of
sketches, fabrics and trim and any other materials used for Licensed Products, a
line list (including prices), and a Sample of each Licensed Product for such
seasonal collection of Licensed Products within fifteen (15) days after
Licensor's approval thereof. If Licensor reasonably requests that Licensee
create Licensed Products for use in fashion shows, product presentations and/or
other public relations and promotional activities of Licensor, Licensee shall,
at its sole cost and expense, create and shall deliver to Licensor a reasonable
quantity of such Licensed Products as soon as commercially practicable after
each such request. Licensee acknowledges that, in any Contract Year, requests by
Licensor for Licensed Products pursuant to this Section 4.3 may require that
Licensee deliver Licensed Products earlier than Licensee is otherwise required
to deliver Samples to Licensor pursuant to this Section 4.3. Licensee shall also
provide Licensor, without charge, with a reasonable number of samples and
finished Licensed Products for each season for use in connection with various
public relations activities in support of the Trademarks.

     4.4 MECHANISM FOR OBTAINING LICENSOR'S APPROVAL. Except for Licensor's
approval of Samples and manufacturing samples of finished Licensed Products
obtained pursuant to reviews under Section 4.3, which approval may either be
granted or withheld upon Licensor's conduct of such inspection, all other
approvals required or permitted by this Agreement, including, but not limited
to, approvals of designs, marketing materials, labels, packaging, tags or any
other materials upon which or in connection with which Licensee intends to
display either of the Trademarks, shall be requested by Licensee in a written
submission form to be mutually agreed upon by the parties, upon which Licensor
shall indicate its approval or disapproval in writing. Licensee shall have each
item for which Licensor's written approval is sought by Licensee delivered by
fax, mail, messenger, by hand or the like to Licensor, attn. President of
Licensing, or whatever other address Licensor may provide Licensee in writing
from time to time. Licensor shall respond to each such request as promptly as
practicable, and in all cases within ten (10) days after submission of the item
to be approved, taking into consideration the nature of the material for which
approval is sought and the Design Calendar, but approval shall in no event be
deemed or inferred by any delay or failure of Licensor to respond to any such
request.

     4.5 QUALITY CONTROL; INSPECTIONS. Licensee acknowledges that the Trademarks
represent the prestige and goodwill that Licensor, its corporate affiliates and
its predecessors have earned for themselves as providers of high-quality apparel
and other products, including accessories. Accordingly, Licensee shall carry out
the manufacture, sale, distribution and promotion of Licensed Products so as to
maintain a general standard of quality commensurate

with that which the public has come to associate with the Trademarks. Licensee
shall manufacture Licensed Products in accordance with high quality standards
and in conformity with the Samples approved by Licensor pursuant to Section 4.3
hereof. Upon Licensor's reasonable request, Licensee shall submit to Licensor
for inspection current production samples of finished Licensed Products so that
Licensor may ensure that the requisite quality standards are being maintained.
Further, Licensee shall permit or cause Licensor and its representatives to be
permitted, upon advance notice and during normal business hours, to examine
Licensed Products in the process of being manufactured and may inspect all
facilities operated under the direction or control of Licensee used in
connection therewith.

     4.6 DISPLAY OF TRADEMARKS; LABELS. Licensee shall display the Trademarks in
a manner reasonably acceptable to Licensor and, if required by Licensor, shall,
unless impracticable, include notices on the labels of Licensed Products
reflecting Licensor's ownership of the Trademarks. Licensee shall submit to
Licensor for its approval any labels and any other such display items or
packaging materials designed by Licensee to be used in connection with the
Licensed Products, which approval shall not be unreasonably withheld.

     4.7 DEDICATED PERSONNEL. In addition to the design staff required under
Section 4.2 hereof, at all times during the term of this Agreement, Licensee
shall employ, at Licensee's sole cost and expense, a dedicated executive
responsible for management of the marketing, sale and distribution of the
respective Licensed Products, and an appropriate team of product merchandisers
and sales representatives responsible for the marketing, sale and distribution
of the respective Licensed Products, as set forth on the chart attached hereto
as Schedule 4.7.

     4.8 SUBCONTRACTORS. Licensee may engage subcontractors to manufacture and
produce the Licensed Products, provided that Licensee shall ensure that any and
all such subcontractors comply with Licensor's high quality standards, all
relevant terms of this Agreement, and with Licensor's Code of Conduct as it may
be amended from time-to-time. Licensor's current Code of Conduct is annexed
hereto as Schedule 4.8(a). Licensee shall not knowingly engage any subcontractor
to manufacture or produce the Licensed Products that violates or in the past has
violated any prohibitions on child labor and/or environmental standards under
either local or international law. If Licensee discovers at any time during the
term hereof that any subcontractor engaged by Licensee is in violation of such
prohibitions and/or standards, or of Licensor's Code of Conduct, Licensee shall
terminate its relationship with such subcontractor as soon as commercially
practicable. In order to maintain Licensor's high standard of quality control
and to ensure that appropriate measures are taken against counterfeiting, at the
start of every Contract Year Licensee shall provide to Licensor a list of its
subcontractors setting forth the name and address of each such subcontractor and
the specific Licensed Products to be manufactured thereby. In addition, Licensee
shall obtain the signature of each subcontractor on a brief agreement designated
to protect Licensor's rights in the Licensed Products, Trademarks and IP Rights,
substantially in the form set forth annexed hereto as Schedule 4.8(b), and shall
as promptly as commercially reasonable discontinue the use in connection with
Licensed Products of any subcontractor who fails to execute such an agreement.
Licensee shall remain primarily and fully liable to Licensor for all of its
obligations and covenants under this Agreement notwithstanding any such
arrangements with subcontractors.

                                                          CONFIDENTIAL TREATMENT

     4.9 TRAVEL EXPENSES. Any and all reasonable travel expenses of Licensor
approved in advance by Licensee in connection with the design, development and
production of the Licensed Products, including airfares, accommodations, meals
and other reasonable incidental charges consistent with Licensor's then current
travel policy, shall be borne solely by Licensee, and Licensee shall reimburse
Licensor therefor promptly after Licensor's submission to Licensee of receipts
documenting the same. Such travel expenses shall include any reasonable travel
by no more than two of Licensor's designees to attend reviews pursuant to
Section 4.3.

5. SALE AND DISTRIBUTION OF LICENSED PRODUCTS

     5.1 MARKET DEVELOPMENT. Licensee shall use commercially reasonable good
faith efforts to develop, exploit and maintain in the Territory the market for
each of Collection Products and Better Products, in keeping with the prestige of
the MICHAEL KORS and MICHAEL MICHAEL KORS trademarks, and the high quality
products associated therewith. Licensee shall not sell Licensed Articles to any
entity which it knows or has reason to believe intends to export Licensed
Articles to Japan.

     5.2 BUSINESS PLAN. Annexed hereto as Schedule 5.2 is Licensee's initial
business plan for Licensed Products for the first Contract Year. Licensee shall
deliver to Licensor a Business Plan for each subsequent Contract Year by no
later than the January 15 immediately preceding such Contract Year (the
"Business Plan"). By way of example, the Business Plan to be delivered by
January 15, 2006 shall cover the Contract Year starting on July 1, 2006.

     5.3 SALES REPORTS. Within ten days after the end of every month during each
Contract Year, Licensee shall deliver to Licensor a sales report in the form
annexed hereto as Schedule 5.3, containing a complete list of Licensee's
then-current accounts and its sales during the past month in units and dollars
of Licensed Products by customer account and by style, and for comparison, the
same information for the prior month, the year to date and for the same month in
the previous Contract Year. Licensee shall also provide in such monthly sales
reports such additional information as Licensor may reasonably request. Licensee
shall further provide to Licensor, upon Licensor's reasonable request, a weekly
sales report showing Licensee's retail sales over the previous week in each
department store where Licensed Products are then being sold.

     5.4 CHANNELS OF DISTRIBUTION. *** Any sale or distribution of Licensed
Products to an account that has not been approved in advance by Licensor shall
be deemed a material breach of this Agreement. It is understood and agreed that
(i) Licensed Products under the MICHAEL KORS trademark shall be sold by Licensee
exclusively in the Designer Collection Zones of such stores, and (ii) Licensed
Products under the Better Mark shall be sold by Licensee exclusively in the
respective swimwear Zones of such stores, with the exception of: (i) specialty
stores or other stores that do not merchandise such products in a separate Zone
and (ii) Licensor Retail Stores. All requests by Licensee for the approval of a
new account shall be submitted to Licensor by completing a New Account Approval
Form in the form set forth in Schedule 5.4(c) hereto. Licensee shall keep
records of all New Account Approval Forms throughout the term of this Agreement
and for two (2) years following the termination or expiration hereof. Only with
Licensor's prior written approval on a case-by-case basis, Licensee shall have
the right to sell,

                                                          CONFIDENTIAL TREATMENT

offer for sale or distribute Licensed Products: (i) to bases or exchanges of the
Armed Forces, (ii) to Duty Free retailers, (iii) through Duty Free channels of
trade, or (iv) internet sites of bricks and mortar accounts or (v) direct mail
merchants.

     5.5 SALES OF LICENSED PRODUCTS TO LICENSOR RETAIL STORES. Licensee shall
sell Licensed Products, directly and on a priority basis, to all Licensor Retail
Stores, in such reasonable quantities as they may order. Licensor shall place
its orders with Licensee in advance of the intended shipment date by 120 days,
or such shorter lead time as Licensee permits with respect to any of its other
accounts. From time to time, Licensor may request and, upon Licensor's request
Licensee shall create and produce, special Licensed Products exclusively for
sale through Licensor Retail Stores. In the event Licensee refuses to create and
produce such special Licensed Products, in addition to such other remedies as
Licensor may have, Licensor shall be entitled to cause such special Licensed
Products to be produced by any third party for sale exclusively at Licensor
Retail Stores. Except as provided in Section 5.6, the price to be charged by
Licensee for Licensed Products sold to Licensor Retail Stores operated by
Licensor or its Affiliates shall be ***. Licensee represents, warrants and
covenants that its published wholesale price is, and at all times during the
Term shall be, the price at which its approved specialty store accounts
generally purchase Licensed Products at the beginning of each season. All other
terms of sales pursuant hereto shall be consistent with the terms offered by
Licensee to Licensee's best customers for Licensed Products, and Licensee shall
comply with all commercially reasonable requirements of Licensor Retail Stores
as to the tagging and packing of Licensed Products. For purposes of this Section
5.5 only, Licensor Retail Stores shall include wholesale and retail licensees of
Licensor responsible for the promotional and sale of products bearing the
Trademarks outside of the Territory.

     5.6 SECONDS, RETURNS AND EXCESS INVENTORY. Licensee shall sell Discounted
Goods to Licensor Retail Stores at the manufacturing cost thereof, and shall
advise Licensor as to its inventory of Discounted Goods on a timely basis and
otherwise make Discounted Goods reasonably available to Licensor Retail Stores.
Licensee may sell such inventory of Discounted Goods as Licensor Retail Stores
do not purchase to approved off-price accounts as provided in Section 5.4.
Licensee shall clearly and permanently "red line" the labels of any Seconds, and
shall require any off-price accounts not to advertise or promote the Licensed
Products. Licensee shall not sell Non-Qualified Discounted Goods without
Licensor's prior written approval. Unless otherwise agreed in writing, Net Sales
of any Non-Qualified Discounted Goods shall be deemed to have occurred at the
regular wholesale price thereof. Licensee shall attempt to minimize returns and
excess inventory to the extent commercially feasible.

6. ADVERTISING, MARKETING AND PROMOTION

     6.1 ADVERTISING. Licensor, in its sole discretion, shall determine how to
advertise and promote Licensed Products in the Territory, including without
limitation the amount, type, media and method of such advertising and promotion.
Licensor shall consult with Licensee regarding its plans for advertising and
promotion Licensed Products. For each Contract Year during the term hereof,
Licensee shall pay *** of total Net Sales as a contribution to support
Licensor's institutional image advertising campaigns for Licensed Products
bearing the Trademarks and any other promotional activities that Licensor, in
its sole discretion, may undertake (the "Advertising

                                                          CONFIDENTIAL TREATMENT

Contribution"). *** For purposes of calculating the Advertising Contribution in
any Contract Year after the first Contract Year, the total amount to be paid by
Licensee shall be based on the higher of (i) Licensee's projected Net Sales as
set forth in the Business Plan for the upcoming Contract Year or (ii) actual Net
Sales in the previous Contract Year. The Guaranteed Minimum Royalty and the
Marketing Obligation shall not be credited against the Advertising Contribution.
No expenditures of Licensee for promotion of the Licensed Products (including,
without limitation, cooperative advertising, trade advertising activities and
showrooms) shall be credited against the Advertising Contribution, nor shall
Licensee be otherwise entitled to deduct any amount therefrom. ***

     6.2 MARKETING. Licensee shall spend a minimum of *** in each Contract Year
on cooperative advertising and trade advertising with respect to products
bearing the Trademarks (the "Marketing Obligation"). For purposes of calculating
the Marketing Obligation in any Contract Year, the total amount to be spent by
Licensee shall be based on the higher of (i) Licensee's projected Net Sales as
set forth in the Business Plan for the upcoming Contract Year or (ii) actual Net
Sales in the previous Contract Year. The Guaranteed Minimum Royalty and
Advertising Contribution shall not be credited against the Marketing Obligation
and the Marketing Obligation shall not be credited against the Guaranteed
Minimum Royalty or the Advertising Contribution. No expenditures of Licensee for
the marketing or promotion of the Licensed Products other than cooperative
advertising and trade advertising shall be credited against the Marketing
Obligation, nor shall Licensee be otherwise entitled to deduct any amount
therefrom except as expressly set forth in this Section 6.2. At all times during
the term hereof, Licensee shall keep accurate records documenting and
substantiating its Marketing Obligation expenditures to date and, upon
Licensor's request any time during the term hereof, shall deliver such records
to Licensor within fifteen (15) days of Licensor's request. If for any reason in
any Contract Year Licensee expends less than the Marketing Obligation for such
Contract Year, Licensee shall spend the entire amount not expended within the
first ninety (90) days of the immediately subsequent Contract Year on marketing
activities approved in advance by Licensor; provided, however, that if Licensee
expends less than the Marketing Obligation during the final Contract Year of the
Term, then the amount not expended shall be paid to Licensor immediately upon
the expiration of the Term. Expenditures made pursuant to Licensee's obligation
to spend its Marketing Obligation for any Contract Year shall not be credited
against the Marketing Obligation for any other Contract Year. Expenditures
during any Contract Year in excess of the Marketing Obligation for such Contract
Year shall not be credited against the Marketing Obligation for any other
Contract Year.

     6.3 TRADE SHOWS AND OTHER PROMOTIONAL ACTIVITIES. In each Contract Year,
upon Licensor's request, Licensee shall, at Licensee's reasonable sole expense
(which shall consist of a reasonable allocable share of the overall exhibition
cost, and the cost of any fixture specifically created for Licensed Products),
exhibit the Licensed Products in seasonal trade shows where Licensor and/or its
licensees have an overall MICHAEL MICHAEL KORS presence. The design of all
displays for Licensed Products used at such trade shows shall be subject to
Licensor's prior approval. Licensee shall spend such amounts as are reasonable
and customary in Licensee's discretion for the business contemplated herein on
other marketing and promotional activities with respect to Licensed Products not
specifically delineated hereunder including, but not limited to, point-of-sale
materials, fashion shows, seasonal product presentations and events with fashion
editors. Without limiting the generality of the foregoing, Licensee shall use
its commercially

                                                          CONFIDENTIAL TREATMENT

reasonable good faith efforts to: (i) cause point-of-sale materials, such as
signage and other visual enhancements, to be produced and displayed in accounts
which use such signage, and/or other visual enhancements in connection with the
sale of any Products that are comparable or competitive with Licensed Products
and (ii) develop a fixture program with Kramer Design Group or such other design
Company as Licensor may approve in advance, and use its best efforts to cause
the installation of such fixtures as are designed and approved by Licensor at
accounts which use fixtures in connection with the sale of any Products that are
comparable or competitive with Licensed Products. Licensee shall not undertake
any marketing activities, or produce or distribute any marketing or promotional
materials of any kind bearing the Trademarks or used in connection with Licensed
Products without Licensor's prior written approval. Any collateral promotional
material requested by Licensee to be used by Licensee in connection with its
activities pursuant to this Section 6.3 (including, without limitation, look
books, catalogs and pictures) shall be produced by an agency reasonably approved
in advance by Licensor, with all costs thereof to be paid by Licensee.

     6.4 SHOWROOMS. At all times during the term of this Agreement, Licensee
shall, at Licensee's sole cost and expense, construct and maintain in New York,
New York a separate and exclusive showroom for the continuous presentation and
sale of Collection Products and Better Products. Such showroom shall, at
Licensee's sole cost and expense, be designed, constructed and furnished in all
respects by either Licensor or Licensor's designated architects and designers
according to Licensor's specifications and subject to Licensor's reasonable
approval, and must be ready by July 1, 2005. Upon completion, such showroom
shall be subject to Licensor's final review and approval, and shall thereafter
be subject to Licensor's continuing approval thereof, so as to assure reasonable
period renovation to reflect Licensor's showroom concepts and standards. If
requested by Licensor, Licensee shall also provide Licensed Products for display
in Licensor's corporate showroom.

     6.5 LAUNCH CONTRIBUTION. In addition to Licensee's Advertising Contribution
for the first Contract Year, within ten (10) days after the execution and
delivery of this Agreement, Licensee shall pay to Licensor *** as a one time
launch Advertising Contribution, to be used in connection with the launch of
Licensed Products, in consultation with Licensee.

     6.6 FASHION SHOW CONTRIBUTION. In addition to its other obligations
hereunder, Licensee shall, on or before July 1 in each Contract year, pay *** as
a contribution to Licensor's costs in connection with its runway shows and other
product presentations.

7. ROYALTIES AND REQUIRED MINIMUM NET SALES

     7.1 ROYALTY RATE. In consideration of the license granted herein, Licensee
shall pay to Licensor a percentage royalty (the "Percentage Royalty") in each
Contract Year of *** of Net Sales of any and all Licensed Products sold by
Licensee or its Affiliates.

     7.2 GUARANTEED MINIMUM ROYALTY. Licensee shall pay Licensor a
non-refundable guaranteed yearly minimum royalty for each Contract Year (the
"Guaranteed Minimum Royalty") in accordance with Schedule 7.2 attached hereto.
Notwithstanding the foregoing and Schedule 7.2, during the Renewal Term, if any,
the Guaranteed Minimum Royalty in each

                                                          CONFIDENTIAL TREATMENT

Contract Year shall in no event be less than an amount equal to *** of the
actual Percentage Royalty during the immediately preceding Contract Year.

     7.3 GUARANTEED MINIMUM NET SALES. Licensee must achieve the guaranteed
minimum level of Net Sales for each Contract Year as set forth on Schedule 7.2
hereto (the "Guaranteed Minimum Net Sales"). Notwithstanding the foregoing and
Schedule 7.2, during the Renewal Term, if any, the Guaranteed Minimum Net Sales
in each Contract Year shall in no event be less than an amount equal to *** of
the actual Net Sales for such category during the immediately preceding Contract
Year. If in any two consecutive Contract Years Licensee fails to achieve the
Guaranteed Minimum Net Sales, Licensor, in its sole discretion, shall have the
right to terminate the License upon thirty (30) days written notice to Licensee.
Licensee's payment of all Guaranteed Minimum Royalty obligations hereunder shall
not eliminate Licensor's termination rights as set forth in this Section 7.3.

     7.4 INTENTIONALLY OMITTED.

     7.5 ROYALTY STATEMENTS. On a monthly basis, on the last day of the month
immediately following the close of each month in each Contract Year, Licensee
shall provide to Licensor a royalty statement certified as true and accurate by
an officer of Licensee separately setting forth, by country, the aggregate Gross
Sales, merchandise returns, credits, trade allowances and net sales (relevant to
each account) of all sales of Licensed Products by Licensee for the month
covered by such statement, together with a computation of Net Sales and
computation of the amounts due Licensor in respect thereof. The statement for
the final month of each Contract Year also shall include a calculation of total
Net Sales (separately setting forth the amount deducted therefrom in respect of
each of the items (a) through (c) listed in the definition of Net Sales) and the
Percentage Royalty for the preceding Contract Year. Licensor's acceptance of any
statement or payment shall be without prejudice to Licensor's right to dispute
the accuracy thereof, and Licensee shall remain fully liable for any balance due
under this Agreement. Licensee shall pay in full the Percentage Royalty and all
other amounts shown to be due in each royalty statement at the same time such
royalty statement is due. *** For the avoidance of doubt, under no circumstances
shall Licensee be required to pay royalties with respect to any Contract Year in
excess of the greater of the Percentage Royalty or the Guaranteed Minimum
Royalty for such Contract Year, but the Guaranteed Minimum Royalty and
Percentage Royalty payments made with respect to one Contract Year shall not
entitle Licensee to any set-off or deduction in any other Contract Year. For
purposes of this Section 7.5 only, the first Contract Year shall refer to the
period commencing on July 1, 2005 and ending on June 30, 2006.

     7.6 PAYMENTS. All royalties and other amounts payable to Licensor hereunder
shall be paid in U.S. currency to a bank account designated by Licensor.
Licensee may deduct withholding tax from payments, but only to the extent
required by applicable law. If Licensee fails to make any payment hereunder on
the date due, without prejudice to any other right or remedy of Licensor,
Licensee shall pay interest on such unpaid amounts at a rate per annum equal to
two (2) percentage points above the prime commercial interest rate per annum
then being charged by Citibank in New York, New York (or "base rate" or
equivalent if the term "prime rate" is not then being used by Citibank) as of
the close of business on the date such payment initially became due from and
including such date to but not including the date such amount is paid in full
(or, if such rate exceeds

                                                          CONFIDENTIAL TREATMENT

the maximum rate permitted by applicable law, such maximum rate). With respect
to sales of Licensed Products in a currency other than U.S. dollars, for
purposes of calculating the royalty payable to Licensor, such shall be computed
on the basis of the exchange rate of the applicable currency into United States
dollars quoted in The Wall Street Journal as of the close of business on the
last day of the applicable quarter.

     7.7 NO RIGHT OF SET-OFF. Except as expressly provided in Section 7.5
hereof, Licensee shall not have the right to set off, withhold, compensate or
make any deduction from any payment of royalties due hereunder for any reason
whatsoever, unless approved in advance and in writing by Licensor.

     7.8 TAXES. Licensee shall bear all taxes, duties and other governmental
charges in the Territory relating to or arising under this Agreement, including,
without limitation, any state, local or federal income taxes (except withholding
taxes on royalties imposed by applicable law), any stamp or documentary taxes or
duties, turnover, sales or use taxes, value added taxes, excise taxes, customs
or exchange control duties or any other charges relating to or on any royalty
payable by Licensee to Licensor. Licensee shall obtain, at its own cost and
expense, all licenses, Reserve Bank, Commercial Bank or other bank approvals,
and any other documentation necessary for the importation of materials and the
transmission of royalties and all other payments relevant to Licensee's
performance under this Agreement. If any tax or withholding tax is imposed on
royalties, Licensee shall pay all such deducted withholding taxes to the
appropriate taxing authority and deliver to Licensor the certified receipts
evidencing such payment and shall be responsible for any interest and penalties
(in the event such tax payments are not made timely). Nothing herein shall be
construed so as to require Licensee to pay state, local or federal taxes based
on Licensor's income.

     7.9 ROYALTY RECORDS. Licensee shall keep true books of account containing
an accurate record of all data necessary for the determination of the amounts
payable to or on behalf of Licensor under this Agreement, and maintain the same
throughout the Term and for two (2) years thereafter. Licensor may from time to
time, during regular business hours and upon reasonable advance notice, examine
the applicable records of Licensee in order to verify payments, record keeping
requirements and compliance by Licensee with its obligations hereunder. Such
examinations shall be conducted during regular business hours at the Licensee's
offices by a certified public accountant selected by Licensor. All costs and
fees relating to each such examination shall be borne by Licensor, provided,
however, that if any such examination discloses an underpayment or
underexpenditure by Licensee exceeding ***, Licensee shall pay the costs and
fees thereof. Licensor shall conduct no more than one (1) such examination
during a twelve (12)-month period.

8. TRADEMARKS AND IP RIGHTS

     8.1 OWNERSHIP OF TRADEMARKS AND IP RIGHTS. As between Licensor and
Licensee, the Trademarks and IP Rights (including IP Rights in all materials of
any kind created by or on behalf of Licensee hereunder) and the goodwill
appurtenant thereto are the sole and exclusive property of Licensor. Licensee
acknowledges that all uses of the Trademarks and IP Rights hereunder and all the
goodwill attached or which shall become attached to the Trademarks and IP Rights
in connection with the manufacture, sale, distribution, promotion and
advertising of the Licensed

Products shall inure solely to Licensor's benefit.

     8.2 PROTECTION OF TRADEMARKS AND IP RIGHTS. Licensor and Licensee shall
prepare and execute all necessary documents, including, without limitation,
registered user agreements and/or license registration documents, and Licensee
shall cooperate with Licensor as reasonably requested by Licensor and do
whatever is reasonable and necessary for the protection of the Trademarks and
the IP Rights. Licensee shall not knowingly or intentionally do anything or
authorize anyone to do anything which may adversely affect any ownership rights
of Licensor in the Trademarks, or the IP Rights, or which reduce the value of
the Trademarks or disparage or detract from their reputation and prestige.
Licensor in its sole discretion, in consultation with Licensee, shall determine
whether the Trademarks and IP Rights should be registered and shall bear all
costs of such registrations, maintenance and renewals in the Territory. Licensee
shall not seek to register the Trademarks, the IP Rights, or any trademark
confusingly similar to the Trademarks for any products, and Licensee shall not
use any trademark confusingly similar to the Trademarks for any products.
Licensee shall not commence the distribution of Licensed Products in any country
in the Territory without first obtaining Licensor's written confirmation that
all necessary trademark rights have been secured in such country; provided that,
notwithstanding the foregoing, Licensee may nevertheless commence the
distribution of Licensed Products in a country to establish common law rights
(but shall not seek any registrations relating thereto) even without obtaining
such written confirmation from Licensor if Licensee provides Licensor written
confirmation at least one (1) month prior to any such distribution that Licensee
will not seek any indemnification or any other compensation from Licensor for
any costs, damages or other liabilities that Licensee may incur or suffer as a
result of such distribution in such country. Annexed hereto as Schedule 8.2 is a
list of countries in which Licensee may commence distribution of Licensed
Products immediately. The provisions of, and the obligations of Licensee under,
this Article 8 shall survive the expiration or termination of this Agreement.

     8.3 NO CHALLENGE. Licensee shall not challenge Licensor's ownership of or
the validity of any of the Trademarks or IP Rights, any applications or
registrations therefor or any rights of Licensor therein. The provisions of this
Section 8.3 shall survive the expiration of the Term.

     8.4 USE OF TRADEMARKS AND IP RIGHTS. Licensee shall use the Trademarks and
IP Rights solely in connection with the Licensed Products. Licensee shall use
and display the Trademarks only in such form and manner as are specifically
provided or approved by Licensor. Licensor may promulgate, from time to time,
reasonable rules and amendments thereto, relating to use of the Trademarks, and
Licensee shall comply with all such rules and amendments. The terms and
conditions of this provision are subject to Licensee's reservation of rights
with respect to Common Elements.

     8.5 COMPLIANCE WITH LAWS. Licensee shall comply with all the trademark laws
and other applicable laws relating to intellectual property in force in the
Territory in order to protect the rights of Licensor in and to the Trademarks
and IP Rights. Licensee shall use the Trademarks and IP Rights strictly in
compliance with all applicable legal requirements and shall use such markings in
connection therewith as may be required by applicable legal provisions. In
addition, each Licensed Product shall be manufactured, packaged, labeled, sold
and distributed in accordance with all applicable international, national,
state, provincial, local and other laws, rules and regulations, including any
applicable environmental laws, governing the design, quality, transportation and
safety of such products. Licensee expressly acknowledges that Licensor shall

rely on Licensee to ensure that the manufacture, packaging, labeling,
advertising, sale and distribution of Licensed Products hereunder shall conform
in all respects with all applicable laws. Licensee shall promptly bring to
Licensor's attention any concerns it may have with respect to legal compliance
of any Licensed Products and, notwithstanding any approval given or request made
by Licensor, Licensee shall not be obligated to make or sell any such items
hereunder until such concerns have been addressed to Licensee's reasonable
satisfaction.

     8.6 INFRINGEMENT. Licensee shall notify Licensor in writing promptly upon
learning of any suspected infringement of the Trademarks or IP Rights, or
imitation or counterfeiting of Licensed Products in the Territory. Licensor
thereupon shall at its sole discretion take such action as it deems advisable
for the protection of its rights in and to the Trademarks, IP Rights and
Licensed Products and, if requested to do so by Licensor, Licensee shall provide
reasonable assistance to Licensor in all respects, including, without
limitation, by being plaintiffs or co-plaintiffs in any one or more lawsuits in
connection therewith and by causing their officers to execute pleadings and
other related documents. The institution and conduct of litigation, the
selection of attorneys and the settlement of litigation and claims affecting the
Trademarks and IP Rights in the Territory shall be entirely within the
discretion of Licensor and under Licensor's control and at Licensor's expense.
Licensee may, in its discretion, participate in such litigation relating to
infringing Products at its own expense with its own attorneys. In no event,
however, will Licensor be required to take any action if it deems it inadvisable
to do so and Licensee will have no right to take any action with respect to the
Trademarks or IP Rights without Licensor's prior written consent. All costs and
expenses, including reasonable legal and investigative fees incurred in
connection with any such actions which are so undertaken, shall be borne by
Licensor, and Licensor shall be solely entitled to any recovery in such action.

     8.7 USE OF TRADEMARKS ON BUSINESS MATERIALS. The use of the Trademarks by
Licensee in the masthead or letterhead of invoices, order forms, stationery and
related materials in advertising in telephone or other directory listings is
permitted only upon Licensor's prior written approval, which shall not be
unreasonably withheld, of the format in which the Trademarks are to be so used,
the juxtaposition of the Trademarks with other words and phrases, and the
content of the copy prior to the initial such use of the Trademarks and prior to
any material change therein; provided, however, that each such use of the
Trademarks is only in conjunction with the manufacture, sale, distribution or
promotion of Licensed Products pursuant to this Agreement. Licensee shall not
use any of the Trademarks as part of a business or trade name without Licensor's
prior written approval.

     8.8 NO USE OF TRADEMARKS BY LICENSEE AFTER TERMINATION. Subject to
Licensee's limited right to sell off its inventory pursuant to Section 9.5
hereof, upon termination of this Agreement for any reason whatsoever, Licensee
shall immediately discontinue any and all use of the Trademarks and IP Rights in
connection with products, services or materials of any kind.

9. TERMINATION.

     9.1 OTHER RIGHTS UNAFFECTED. It is understood and agreed that automatic
termination or termination by either party on any ground shall be without
prejudice to any other remedies either party may have. Notwithstanding any
termination in accordance with this Article 9,

Licensor and Licensee shall have and hereby reserve all rights and remedies
which such party has, or which are granted to such party by operation of law, to
be compensated for damages for breach of this Agreement by the other party; and
Licensor shall have and hereby reserves all rights and remedies which it has, or
which are granted to it by operation of law, to enjoin the unlawful or
unauthorized use of the Trademarks or IP Rights (which injunctive relief may be
sought in the courts and also may be sought prior to or in lieu of termination)
and to collect accrued and unpaid royalties. In addition, nothing herein shall
be deemed to prevent Licensee or Licensor from bringing an action for damages in
lieu of seeking termination of this Agreement if a breach by the other occurs
and is not cured timely in accordance with the provisions of this Article 9.

     9.2 AUTOMATIC TERMINATION. This Agreement shall automatically and
immediately terminate:

     (a)  If Licensee is ordered or adjudged bankrupt, is placed in the hands of
          a receiver, enters into any scheme or composition with creditors or
          makes an assignment for the benefit of creditors; or

     (b)  If the assets of the Licensor or Licensee are nationalized or
          appropriated by any government or governmental authority.

            9.3 LICENSOR'S RIGHT OF TERMINATION. Licensor shall have the right
to terminate the Term by delivering thirty (30) days written notice to Licensee
pursuant to Section 7.3, and Licensee shall have no right to cure. In addition,
Licensor shall have the right to terminate the Term, subject to Licensee's right
to cure set forth herein:

     (a)  If Licensee fails to pay royalties or any other amount due Licensor
          hereunder on the date due;

     (b)  If Licensee's parent corporation, Warnaco Inc., shall fail
          simultaneously with the execution of this Agreement to execute and
          deliver to Licensor a guaranty agreement in the form annexed hereto as
          Schedule 9.3, or if such guaranty shall cease to be effective at any
          time during the Term;

     (c)  If Licensee materially breaches any of its representations and
          warranties herein;

     (d)  If Licensee attacks the title or any rights of Licensor in and to the
          Trademarks; or

     (e)  If Licensee shall otherwise fail to perform any term of this Agreement
          to be performed, not covered by the preceding sections.

Upon Licensee's default, Licensor shall give Licensee writing notice stating the
nature of the default and Licensor's intent to terminate the Term. Licensee
shall have thirty (30) days (except for defaults under Section 9.3(a), in which
case Licensee shall have five (5) days) from receipt of such written notice to
cure the alleged default. If Licensee fails to cure within the time frame set
forth above for the default in question, the Term shall terminate upon the
expiration of the relevant cure period, without the need for Licensor to provide
any additional notice; provided, however, that, to the extent any such default
under Sections 9.3(e) is curable but not within such thirty (30)-day period, and
Licensee is diligently proceeding to cure such default, such default will not
constitute grounds for termination if it is cured within ninety (90) days from
the date the notice of default was given. Notwithstanding anything to the
contrary contained herein, (i)

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Licensor shall not have the right to terminate this Agreement by reason of a
trivial, but non-curable, breach of this Agreement by Licensee and (ii) any cure
period specified herein may be mutually extended by written agreement of the
parties hereto.

     9.4 LICENSEE'S RIGHT OF TERMINATION. Licensee shall have the right, subject
to Licensor's right to cure set forth herein, to terminate the Term if Licensor
sells, distributes or authorizes others to sell Licensed Products in violation
of Licensee's exclusive rights hereunder, by giving written notice to Licensor
specifying the default. Licensor shall have ninety (90) days from receipt of
such written notice to cure the alleged default. If Licensor is unable to cure
within the time frame set forth above for the default in question, the Term
shall terminate upon Licensee's further written notice of termination to
Licensor.

     9.5 EFFECT OF TERMINATION; INVENTORY. Upon the termination or expiration of
the Term for any reason whatsoever, the License and all rights of Licensee to
use the Trademarks and IP Rights shall cease and terminate, subject to
Licensee's reservation of rights with respect to Common Elements. Upon any such
expiration or termination, Licensee shall, within twenty (20) days thereafter,
deliver to Licensor, separately for each of the Trademarks, the following: (i) a
complete list of Licensee's then-current accounts for Licensed Products and, for
each account, Net Sales for the last-completed Contract Year, indicating regular
price and off-price sales; (ii) a list of each style, indicating total Net Sales
dollars and units for the last-completed Contract Year, as well as Licensee's
published list price and suggested retail price, if any; (iii) a list of the
"top 20" selling styles for the last-completed Contract Year, and two (2)
samples of each. All information shall be stated separately with respect to each
of the Trademarks and each product category. Simultaneous with the delivery of
such information, Licensee shall also deliver a complete and accurate schedule
of Licensee's inventory (to the SKU level) of Licensed Products, reflecting
Licensee's "Cost" (hereinafter defined) for each item, and all related work in
process and materials then on hand, in the possession of contractors and in
transit including non-cancelable orders identifiable to Licensed Products or
bearing Trademarks ("Inventory"). The Inventory schedule shall be prepared as of
the close of business on the date of the expiration or termination of the
License. Except as Licensor may otherwise agree, all cancelable orders for the
production of Licensed Products and/or related materials used to produce
Licensed Products shall promptly be canceled. Licensor shall have the option
(but not the obligation), exercisable by written notice delivered to Licensee
within fifteen (15) days after its receipt of the Inventory schedule, to
purchase any or all of the Inventory for an amount equal to ***. No Percentage
Royalty shall be due from Licensee in respect of any such sales to Licensor at
the prices set forth in the preceding sentence. In the event Licensor notifies
Licensee that it is exercising its purchase option, Licensee shall deliver to
Licensor or its designee all of the Inventory referred to in Licensor's notice
within fifteen (15) days after receipt of such notice. Licensor shall pay
Licensee for such Inventory as is in marketable, first quality condition within
thirty (30) days after its receipt thereof, after deduction from the purchase
price all amounts owed by Licensee hereunder. In the event Licensor does not
exercise its purchase option or purchases less than all of the Inventory, and if
the License expires or is terminated by Licensor other than for any breach
arising from material misuse of the Trademarks or any uncured failure by
Licensee to make any payment when due hereunder, Licensee (but no other person
or entity) shall be entitled, for a period of six (6) months only (the "Sell-off
Period") on a non-exclusive basis to sell and dispose of its remaining Inventory
of Licensed Products on hand at the expiration or

other termination of the Term. All sales pursuant to this Section shall be made
subject to all of the provisions of this Agreement and to a timely accounting
for and the payment of the Percentage Royalty thereon. Such accounting and
payment shall be due in accordance with Sections 7.5 and 7.6 hereof, and a final
accounting and payment shall be due within thirty (30) days after the end of the
Sell-off Period. If Licensee fails to comply with the foregoing, Licensor may
terminate the Sell-off Period immediately upon written notice. The term "Cost",
as used in this Section 9.5, shall mean Licensee's landed cost for all inventory
manufactured by third-party contractors, and with respect to inventory
manufactured in factories owned by Licensee, "Cost" shall also mean landed cost,
but may additionally include reasonable corporate cost allocations made by
Licensee consistent with its ordinary accounting practices.

     9.6 COOPERATION AFTER TERMINATION. It is the intention of Licensor and
Licensee that, in anticipation of and upon the expiration or sooner termination
of this Agreement, Licensor and Licensee shall work together to ensure an
orderly transition of the manufacture, sale, distribution and promotion of
Licensed Products from Licensee to Licensor or its designee.

     9.7 FREEDOM TO LICENSE UPON TERMINATION. In the event of termination of
this Agreement or the receipt by Licensor of a notice of termination from
Licensee, Licensor shall be free to license to others the use of the Trademarks
and IP Rights in connection with the manufacture, sale, distribution and
promotion of Licensed Products in the Territory.

     9.8 RIGHTS PERSONAL TO LICENSEE. The licenses and rights granted hereunder
are personal to Licensee. No assignee for the benefit of creditors, receiver,
trustee in bankruptcy, sheriff or any other officer or court charged with taking
over custody of Licensee's assets or business, shall have any right to continue
performance of this Agreement or to exploit or in any way use the Trademarks or
IP Rights if this Agreement is terminated pursuant to this Article 9, except as
may be required by law. In the event that there is a change of control of
Licensee resulting from a merger or consolidation of Licensee with or into any
other entity, or from Licensee's direct or indirect sale or other disposition of
all or substantially all of its voting stock, business or assets, then Licensee
shall give prior written notice of such event to Licensor and shall consult in
good faith with Licensor concerning such change in control. In the event that as
a result of any transaction described in this Section 9.8, a controlling
interest in Licensee shall be owned, directly or indirectly, by an entity which
(i) as a material part of its business, manufactures, distributes, sells or
promotes the sale of apparel or accessories products bearing the name or brand
of any fashion apparel designer who competes directly with Licensor, or (ii) in
Licensor's reasonable, good faith judgment, has an image or marketing position
significantly inconsistent with the image or marketing position associated with
products bearing the Trademarks, Licensor shall have the right to terminate the
term of this Agreement upon eighteen (18) months written notice.

10. INDEMNIFICATION.

     10.1 LICENSOR'S INDEMNIFICATION OF LICENSEE. Licensor shall release,
defend, hold harmless and indemnify Licensee and each of its officers,
directors, controlling persons and agents from any claims, demands, causes of
action, judgments, settlements, fines or other costs (including reasonable
attorneys' fees) arising solely out of a third-party claim that the use by

Licensee of the Trademarks in strict accordance with the terms of this Agreement
violates the rights of such third party; provided, however, that such
indemnification obligation shall not apply to any use of the Trademarks outside
the Territory, notwithstanding Licensor's approval of such use, absent written
confirmation from Licensor that it accepts such indemnification obligation.
Licensee shall give Licensor prompt notice of any such claim or suit. Licensor
shall have the right to undertake and conduct the defense of any suit so brought
through counsel of Licensor's choice and at Licensor's expense.

     10.2 LICENSEE'S INDEMNIFICATION OF LICENSOR. Except as expressly provided
in Section 10.01, Licensee shall release, defend, hold harmless and indemnify
Licensor and each of its officers, directors, controlling persons and agents
from and against any claims, demands, causes of action, judgments, settlements,
fines or other costs (including reasonable attorneys' fees) which Licensor may
incur or be obligated to pay or for which it may become liable or be compelled
to pay in any action, claim or proceeding against it arising out of or in
connection with the business contemplated herein, including without limitation
Licensee's performance of this Agreement, any alleged design or utility patent
infringement, any alleged defect in any Licensed Product produced by or for
Licensee under this Agreement or the manufacture, labeling, sale, distribution
or advertisement of any Licensed Product by Licensee in violation of any law.
Licensor shall give Licensee prompt notice of any such claim or suit. Licensee
shall undertake and conduct the defense of any suit so brought through counsel
of Licensee's choice, subject to Licensor's right of approval, not to be
unreasonably withheld or delayed. Notwithstanding the foregoing, prior to
entering into settlement of any such claim or suit which would be reasonably
likely to adversely affect any of the Licensor Marks and/or would be reasonably
likely to damage Licensor's goodwill, Licensee shall obtain Licensor's written
consent to such settlement (which consent shall not be unreasonably withheld or
delayed). The provisions of this Section and Licensee's obligations hereunder
shall survive the expiration or termination of this Agreement. Licensee's
obligation to indemnify Licensor with respect to design materials provided by
Licensor shall be subject to Licensor informing Licensee of any design
references Licensor used for inspiration in relation to such materials, and, if
available, providing Licensee with each such design reference (or a picture or
other reproduction thereof).

11. REPRESENTATIONS AND WARRANTIES

     11.1 LICENSOR'S REPRESENTATIONS AND WARRANTIES. Licensor represents and
warrants to Licensee that:

     (a)  It has the full right, power and authority to grant the rights herein
          granted to Licensee, including without limitation the right to license
          the Trademarks in accordance with this Agreement; and

     (b)  Neither Licensor nor any Affiliate of Licensor has granted any third
          party a license to use during the Term the Trademarks in violation of
          Licensee's exclusive rights hereunder, and no such other license shall
          be granted to any other party during the Term.

                                                          CONFIDENTIAL TREATMENT

     11.2 LICENSEE'S REPRESENTATIONS AND WARRANTIES. Licensee represents and
warrants to Licensor that:

     (a)  It has the full right, power and authority to enter into this
          Agreement and perform its obligations hereunder;

     (b)  It is not currently the subject of bankruptcy protection;

     (c)  It has adequate resources and personnel to manufacture, sell,
          distribute and promote the Licensed Products within the Territory;

     (d)  It shall take all actions required by any local, national, state or
          regional agency, government or commission to exercise the rights
          licensed hereunder and to perform its obligations hereunder in
          compliance with applicable law. Licensee shall immediately provide
          Licensor with copies of any communication to or from any such agency,
          government or commission that relates to or affects this Agreement or
          the Trademarks in a material respect; and

     (e)  To the best of its knowledge, no event has occurred that, at or prior
          to the date hereof, would have a material adverse impact on the
          business, operation or condition (financial or otherwise) of Licensee
          as of the execution of this Agreement by Licensee.

     11.3 RISKS OF THE BUSINESS. Each party recognizes that there are many
uncertainties in the business contemplated by this Agreement. Each party agrees
and acknowledges that other than those representations explicitly contained in
this Agreement, if any, no representations, warranties or guarantees of any kind
have been made to the other party, either by such other party or its Affiliates,
or by anyone acting on their behalf. Without limitation, no representations
concerning the value of the Licensed Products or the prospects for the level of
their sales or profits have been made and Licensee has made its own independent
business evaluation in deciding to manufacture and distribute the Licensed
Products on the terms set forth herein.

12. INSURANCE. Without limiting Licensee's obligations under the indemnity
provisions set forth in Section 10.2 hereof, Licensee agrees to obtain and
maintain at all times during the Term of this Agreement and for three (3) years
thereafter, at its own expense, comprehensive general and product liability
insurance policies covering all liability arising out of bodily injury,
advertising liability, complete operations liability and/or property damage with
a carrier or carriers reasonably acceptable to Licensor. Said insurance coverage
shall be primary and non-contributing with respect to any other insurance or
self insurance which may be maintained by Licensor. All deductibles,
self-insured retentions or retrospective premium features shall be assumed by
Licensee, for the account of Licensee, and at Licensee's sole expense and risk.
Licensor will be named as an additional insured under such policies with a
minimum total insurance coverage of ***, and Licensee will provide evidence of
such insurance to Licensor, including certificates of insurance and a copy of
all current applicable insurance policies, before commercial sale of the
Licensed Products as provided hereunder. The foregoing amounts shall be subject
to periodic upward adjustment by mutual agreement of the parties, such
adjustment to take into account any increase in sales of Licensed Products and
any other factors that may increase the parties' exposure to potential liability
in connection with the Licensed Products. Licensee or its insurance carrier
shall provide Licensor with certificates of insurance and a copy of all
insurance policies upon each policy renewal, rewriting or change. Licensee or
its insurance carrier shall further provide written notice to

Licensor at least thirty (30) days prior to any insurance policy cancellation,
lapse or termination for any reason whatsoever. At all times, the insurance set
forth herein must cover the countries in the Territory in which Licensee are
from time to time selling and/or distributing Licensed Products. Further,
Licensee shall carry "all risk" property insurance coverage on the Licensed
Products as well as business interruption insurance on Licensee's operations.
The property insurance coverage shall, for the purposes of claim settlement,
reflect selling price as the value of finished goods, and shall cover Licensee's
goods on premises owned, rented or controlled by Licensee and, where required by
the terms of sale, while in transit.

13. ASSIGNMENT AND SUBLICENSING. Neither party shall assign or sublicense this
Agreement, in whole or in part, or any of its rights, duties and obligations
hereunder without the prior written consent of the other party, which consent
shall be withheld only for good faith business purposes, except that Licensor
shall have the right, upon written notice to Licensee, to assign or sublicense
this Agreement, in whole or in part, to an Affiliate of Licensor or the
purchaser of all or substantially all of Licensor's business under, or the right
to use, the Trademarks.

14. CONFIDENTIALITY; PRESS. The parties acknowledge that, in furtherance of this
Agreement, they will receive from the other information which may consist of
business methods and practices, identification of personnel, customers,
prospective customers and suppliers, financial information, inventions,
processes, methods, products, patent applications, specifications, drawings,
sketches, models, samples, designs, ideas, technical information and other
confidential business information and trade secrets. The parties recognize that
these materials are valuable property. Licensee and Licensor acknowledge the
need to preserve the confidentiality and secrecy of these materials and agree to
take all necessary steps to ensure that use by the recipient, or by its
contractors will in all respects preserve such confidentiality and secrecy. Each
party shall take all commercially reasonable precautions to protect the secrecy
of the materials, samples, and designs described in this Article 14 prior to
their commercial distribution or the showing of samples for sale, and shall not
sell any merchandise employing or adapted from any of said designs except under
the Trademarks. Each party shall take all reasonable precautions to protect the
secrecy of the original designs created for Licensed Products prior to their
advertisement, commercial distribution or the showing of samples for sale.
Neither Licensor nor Licensee shall, at any time during the term of this
Agreement, disclose or use for any purpose, other than as contemplated by this
Agreement, any revealed or otherwise acquired confidential information and data
relating to the business of the other. Notwithstanding the foregoing, the
parties hereto shall not be required to treat any information as confidential
information under this Article 14 if such information: (i) was publicly known at
the time it was disclosed or becomes publicly known after disclosure without
breach hereof by the receiving party; (ii) was known by the receiving party at
the time of disclosure or becomes known to it from a party other than the
disclosing party who has the apparent right to disclose such information to the
receiving party's knowledge after due inquiry; (iii) is independently developed
by the receiving party without reliance on the disclosed confidential
information; (iv) is approved for disclosure by the disclosing party with the
disclosing party's prior written consent; or (v) is disclosed by the receiving
party pursuant to judicial order, requirement of a governmental or regulatory
agency or stock exchange or other operation of law, provided that the receiving
party informs the disclosing party promptly after receiving notice of its
obligation to

make such disclosure, and takes reasonable steps to limit the scope of such
disclosure. All press releases and other public announcements related to this
Agreement and the business contemplated herein shall, subject to applicable law
and applicable disclosure obligations thereunder, be produced and released by
Licensor, or, if Licensor expressly agrees, Licensee may produce said press
releases, subject to Licensor's reasonable prior approval, for release by
Licensor. Licensee shall refer all press inquiries to Licensor for handling;
provided, however, Licensee may respond to potential impromtu "live" press
inquiries in a manner consistent with Licensor's instructions from time-to-time
with respect thereto, and Licensee shall promptly report any such inquiries, and
its response, to Licensor. Except in the event of litigation between Licensor
and Licensee, neither Licensor nor Licensee shall, directly or indirectly,
during the Term or thereafter, make any statement that materially adversely
affects, disparages or creates any material negative inference as to the
reputation, prestige, value, image or impression of the Trademarks or the
Licensed Products or any of either party's respective officers, directors,
affiliates, personnel, products or related companies, by words, actions or other
communications, or by any omissions to speak, act or otherwise communicate, or
in any other manner. The provisions of this Section 14 shall survive the
expiration or termination of the Term.

15. MISCELLANEOUS

     15.1 INDEPENDENT CONTRACTORS. Licensee shall act as an independent
contractor under the terms of this Agreement and is not now, or in the future,
an agent or legal representative of Licensor for any purpose. Neither party has
the power to the other party in any way. Licensor shall act as an independent
contractor under the terms of this Agreement and is not now, or in the future,
an agent or legal representative of Licensee for any purpose. Licensor does not
have the Power to bind Licensee in any way.

     15.2 CHOICE OF LAW; CHOICE OF FORUM. This Agreement shall be construed
according to the laws of the State of New York. The parties hereto agree to
accept the exclusive jurisdiction and venue of the courts of the State of New
York, and the federal district courts situated in New York, New York for the
adjudication of any dispute arising in connection with or related to this
Agreement or the interpretation of this Agreement. The parties hereby submit to
the personal jurisdiction of the foregoing courts for the adjudication of any
dispute arising out of or related to this Agreement and waive any objection
based on the lack of personal jurisdiction.

     15.3 PARTIAL INVALIDITY. If any of the provisions of this Agreement is held
to be invalid, void, or unenforceable, the remainder of the provisions shall
remain in full force and effect and shall in no way be affected, impaired, or
invalidated.

     15.4 FORCE MAJEURE. Neither party hereto shall be under any liability
hereunder to the other on account of any loss, damage or delay occasioned or
caused by lockouts, strikes, riots, fires, explosions, blockade, civil
commotion, epidemic, insurrection, war or warlike condition, acts of terrorism,
the elements, embargoes, failure or inability to obtain material or
transportation facilities, acts of God or the public enemy, compliance with any
law, regulation or other governmental order or other causes beyond the control
of the party affected, whether or not similar to the foregoing; provided,
however, that if such condition continues for six (6) months and is not
industry-wide but applies only to Licensee, Licensor may terminate the Term on
thirty

(30) days' written notice which may be given at any time after said six (6)
month period; and provided, further, that nothing herein shall at any time
excuse any accrued obligation for the payment of money.

     15.5 ENTIRE AGREEMENT. This Agreement, including the Exhibits hereto,
constitutes the entire agreement between Licensor and Licensee concerning the
subject matter hereof and supersedes all prior and contemporaneous agreements
between the parties. This Agreement, including this Section 15.5, may be amended
only by an instrument in a fully signed writing that expressly refers to this
Agreement and specifically states that it is intended to amend it. No party is
relying upon any warranties, representations, or inducements not set forth
herein.

     15.6 NOTICES. All notices or other communications pursuant to this
Agreement shall be in writing and shall be deemed valid and sufficient if
delivered by personal service or overnight courier or if dispatched by
registered mail, postage prepaid, in any post office, or if dispatched by
telefax, promptly confirmed by letter dispatched as above provided, addressed as
follows:

           If to Licensor: Michael Kors, L.L.C.
                           11 West 42nd Street
                           New York, New York 10036
                           Fax: 646.354.4722

                           Attention:  President--Licensing

                           Copy to:

                           Michael Kors, L.L.C.
                           550 Seventh Avenue
                           New York, New York 10018
                           Fax: 646.354.4824

                           Attention:  General Counsel

           If to Licensee:
                           Warnaco Swimwear Products Inc.
                           6040 Bandini Blvd.
                           Los Angeles, CA 90040
                           Fax:  323-726-3591

                           Attention: President - Designer Swimwear

                           Copy To:

                           The Warnaco Group, Inc.
                           501 Seventh Avenue
                           New York, New York 10018

                           Attention: General Counsel
                           Fax: 212.287.8511

     15.7 BINDING NATURE. This Agreement shall be binding on and inure to the
benefit of the parties hereto, their successors and permitted assigns.

     15.8 SECTION HEADINGS. The section and subsection headings and the captions
of the Exhibits appear only as a matter of convenience and shall not affect the
construction of the Agreement.

     15.9 AUTHORITY. Each party represents that the person signing this
Agreement on its behalf has been duly authorized and empowered to execute this
Agreement.

     15.10 COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be considered an original but which together shall
constitute one and the same instrument.

     15.11 CONSTRUCTION. Each party has carefully reviewed this Agreement,
understands its terms, sought legal advice with respect to this Agreement, and
has relied wholly on its own judgment and knowledge and has not been influenced
to any extent whatsoever in making this Agreement by any representations or
statements made by any other party or anyone acting on behalf of any other
party. Any rules of construction construing an agreement against the drafting
party shall not apply to the construction of this Agreement.

     15.12 SCHEDULES. The attached exhibits shall form a part of this Agreement
and are hereby incorporated into this Agreement by reference.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed on the day and year below written.

                                       MICHAEL KORS, L.L.C.

                                       By: /s/ John Idol
                                           --------------------------------
                                       Name: John Idol
                                       Title:

                                       WARNACO SWIMWEAR PRODUCTS INC.

                                       By: /s/ Stanley P. Silverstein
                                           --------------------------------
                                       Name: Stanley P. Silverstein
                                       Title: President

                                                          CONFIDENTIAL TREATMENT

                                  SCHEDULE 4.1

                   WARNACO SWIMWEAR GROUP DELIVERY CHECKPOINTS

                                       ***

                                                          CONFIDENTIAL TREATMENT

                                  SCHEDULE 4.7

                          LICENSEE ORGANIZATIONAL CHART

                                       ***

                                 SCHEDULE 4.8(a)

--------------------------------------------------------------------------------
           MICHAEL KORS CORPORATION AND SUBSIDIARIES - CODE OF CONDUCT

Michael Kors Corporation and its subsidiaries are dedicated to conducting their
operations throughout the world on principles of ethical business practice and
recognition of the dignity of workers. We expect our business partners to
respect and adhere to the same standards in the operation of their business, and
we will utilize these criteria to evaluate our relationships with customers and
suppliers.

WAGES/BENEFITS/WORKING HOURS. Our business partners must comply with all laws
regulating local wages, work hours and benefits. Wage and benefit policies must
be consistent with prevailing national standards, and also be acceptable under a
broader international understanding as to the basic needs of workers and their
families. We will not work with companies whose wage structure violates local
law or prevailing industry practice.

CHILD LABOR. Our business partners must not use child labor, defined as school
age children. Our business partners will not employ workers under the age of 15.
This provision extends to all partner facilities.

HEALTH & SAFETY. Our business partners must ensure that their workers are
provided a safe and healthy work environment, and are not subject to unsanitary
or hazardous conditions.

FREEDOM OF ASSOCIATION. Our business partners should respect the legal rights of
employees to freely and without harassment participate in worker organizations
of their choice.

PRISON OR FORCED LABOR. Our business partners will not work with or arrange for
purchase of any materials from business partners who utilize prison or forced
labor in any stage of the manufacture of our products.

DISCIPLINARY PRACTICES. Our business partners will not employ or conduct any
business activity with partners who employ any form of physical or mental
coercion or punishment against workers.

DISCRIMINATION. Our business partners will not practice nor do business with
business partners who practice any form of improper discrimination in hiring and
employment, including on the basis of age, race, color, gender, or religion.

ENVIRONMENT. Our business partners must embrace a fundamental concern for
environmental protection and conduct their operations consistent with both local
and internationally recognized environmental practices.

LEGAL REQUIREMENTS. Our business relationship must be built on a mutual respect
for and adherence to legal requirements. Our business partners will observe both
local and applicable international standards.

ETHICAL STANDARDS. We intend to conduct all our business in a manner consistent
with the highest ethical standards, and we will seek and utilize partners who
will do likewise, as this contributes directly to our corporate reputation and
the collective success of our organization and selected business partners.

SUBCONTRACTING. Our business partners may not subcontract all or any part of the
work on our products without our express written consent, which will not be
given unless each subcontractor meets all of the criteria set forth herein.

CONFLICTS OF INTEREST. Our business partners may not give our employees, agents
or subagents a gift of value in excess of US$100.00, and may not bribe the
officials of any government or administrative authority to benefit us or our
business.

IMPLEMENTATION. We will apply these criteria in all business partner
determinations, and will continue to implement these policies in the conduct of
all activities. This will include our business partners sharing information on
production facilities and procedures, with the objective of improving our
collective service to customers in a responsible manner. Failure by a business
partner to meet these standards, will result in our taking appropriate actions,
up to and including cancellation of existing orders.

--------------------------------------------------------------------------------

                                 SCHEDULE 4.8(b)

                             SUBCONTRACTOR AGREEMENT

The undersigned contractor (the "Contractor") has been engaged by [NAME OF
LICENSEE] (the "Customer") to manufacture, sell and/or distribute [insert
Licensed Products] (the "Products") and, from time to time in the future, again
may be engaged by the Customer to manufacture, sell and/or distribute Products
for the Customer.

The Contractor acknowledges that certain Products which it now manufactures,
sells and/or distributes or in the future will manufacture, sell and/or
distribute for the Customer will be sold by the Customer under license from
Michael Kors, L.L.C. (the "Licensor") and will bear the [MICHAEL MICHAEL KORS]
and/or Licensor's trademark [MICHAEL KORS] and/or other trademarks of Licensor
(the "Trademarks").

The Contractor agrees that it will sell any and all Products bearing the
Trademarks which it now manufactures or in the future will produce for the
Customer only to the Customer, unless otherwise authorized in writing by the
Customer, and will sell or distribute Products bearing the Trademarks only as
expressly permitted by the Customer.

The Contractor further agrees that, in connection with the manufacture, sale
and/or distribution of Products bearing the Trademarks, the Licensor and the
Customer shall have the right to inspect its facilities and that the Contractor
will not use any child labor or violate any labor or other applicable laws in
connection therewith.

The Contractor further acknowledges that the manufacture, sale and/or
distribution of any Products bearing the Trademarks other than as expressly
permitted herein, will result in irreparable damage and injury to both the
Customer and the Licensor for which they will have no adequate remedy at law.
Accordingly, the Contractor agrees that each of Customer and Licensor shall be
entitled to immediate, preliminary and permanent injunctive relief to enjoin any
sales, distribution or labor practices prohibited hereunder, or otherwise to
specifically enforce the terms hereof. The Contractor acknowledges and agrees
that the foregoing right to injunctive relief and/or specific performance shall
be in addition to, and not in lieu of, any other rights and remedies available
at law or in equity to either Customer or Licensor.

Date:
      -------------------------------
                                       [CONTRACTOR]
                                       By:
                                           ------------------------------------
                                       Name   :
                                       Title  :
                                       Address:
                                       Telephone:
                                       Facsimile:

                                                          CONFIDENTIAL TREATMENT

                                  SCHEDULE 5.2
                                  BUSINESS PLAN

                                       ***

                                                          CONFIDENTIAL TREATMENT

                                 SCHEDULE 5.4(a)

                APPROVED PRESTIGE DEPARTMENT AND SPECIALTY STORES

                                       ***

                   MICHAEL MICHAEL KORS: ACCOUNT DISTRIBUTION

                                       ***

                                                          CONFIDENTIAL TREATMENT

                                 SCHEDULE 5.4(b)

                           APPROVED OFF-PRICE ACCOUNTS

                                       ***

                                 SCHEDULE 5.4(c)
                            NEW ACCOUNT APPROVAL FORM
NAME OF LICENSEE                       DATE:
                 ---------------------       ----------------------------------
                 MEN'S        WOMEN'S
                       -----          -----

================================================================================

ACCOUNT INFORMATION

COMPANY NAME:
                       ---------------------------------------------------------
DOING BUSINESS AS
(ATTACH BUSINESS CARD)
                       ---------------------------------------------------------

ADDRESS
                       ---------------------------------------------------------

                       ---------------------------------------------------------
CITY, STATE
                       ---------------------------------------------------------
COUNTRY
                       ---------------------------------------------------------
TELEPHONE
                       ---------------------------------------------------------
EMAIL
                       ---------------------------------------------------------
PRINCIPAL/OWNER
                       ---------------------------------------------------------
BUYER / MANAGER
                       ---------------------------------------------------------
# OF STORES
                       ---------------------------------------------------------
LOCATION(S)
PHOTOS ATTACHED
                       ---------------------------------------------------------

                       ---------------------------------------------------------

                       ---------------------------------------------------------
BRANDS CARRIED
(LIST AT LEAST 3)
                       ---------------------------------------------------------

                       ---------------------------------------------------------

                       ---------------------------------------------------------
TYPE OF RETAILER
                       ---------------------------------------------------------

================================================================================

APPROVAL
         ----------------------------   ----------------------------------
         LICENSEE REPRESENTATIVE                MICHAEL KORS, LLC
APPROVED

** APPLICATION WILL NOT BE PROCESSED FOR APPROVAL WITHOUT THE FOLLOWING**
-------------------------------------------------------------------------
                        ** Photographs
                        ** Business Card
                        ** Trade References

                                                          CONFIDENTIAL TREATMENT

                                  SCHEDULE 7.2

                    GUARANTEED MINIMUM ROYALTY AND NET SALES

                                       ***

                                  SCHEDULE 8.2

             COUNTRIES IN WHICH IMMEDIATE DISTRIBUTION IS AUTHORIZED

                                  SCHEDULE 9.3
                           FORM OF GUARANTEE AGREEMENT

                                     January __, 2004

Michael Kors (USA) LLC
11 West 42nd Street
New York, NY 10036

Re:  License Agreement between Warnaco Swimwear Products Inc. ("LICENSEE") and
     Michael Kors, L.L.C. ("KORS") dated as of June 7, 2004 (the "AGREEMENT").

Gentlemen:

     Warnaco Inc. ("GUARANTOR"), to induce Kors into entering into the
above-referenced Agreement with Licensee, hereby guarantees the obligations of
Licensee under the Agreement as set forth herein.

     Guarantor represents and warrants that it owns, directly or indirectly,
100% of the issued and outstanding stock in Licensee.

     Guarantor hereby unconditionally guaranties: (i) the prompt payment of any
and all monies owed by Licensee under the Agreement and (ii) the performance of
all obligations of Licensee under the Agreement.

     This guaranty made by Guarantor pursuant hereto (this "GUARANTY") shall be
a continuing, absolute and unconditional guaranty of payment and performance and
shall remain in full force and effect until the later of the full and complete
performance by Licensee and/or Guarantor of their respective obligations under
the Agreement and this Guaranty. This Guaranty may be enforced directly and
immediately following any event of default (as described in the Agreement) on
the part of Licensee under the Agreement, and without prior notice of, demand
upon, or any prior action against, Licensee, and without resorting to any other
remedies available to Kors.

     The Guarantor shall not be released from its obligations hereunder, and
this Guaranty shall not be affected, modified or impaired in any way whatsoever
upon the happening from time to time of any event, including without limitation,
any of the following, whether with or without notice to or consent of the
Guarantor: (i) the modification, extension or amendment of the Agreement made in
accordance with the terms thereof; (ii) the compromise, settlement,
modification, release or termination of any of the foregoing obligations hereby
guarantied by the Guarantor; (iii) the failure to give notice to the Guarantor
of the occurrence of any default in the performance of any such obligations or
any amendment of the Agreement, provided notice of such default is given in
accordance with the Agreement; or (iv) any failure, omission or delay by any
party to the Agreement to exercise any right or remedy to which it may be
entitled.

     Upon the occurrence of any event set forth in paragraph (a) or (b) (an
"EVENT OF DEFAULT"):

     (a) The Guarantor institutes proceedings seeking relief under a bankruptcy
act or any similar law, or consents to entry of an order for relief against it
in any bankruptcy or insolvency proceeding or similar proceeding, or files a
petition or answer or consent for reorganization or other relief under any
bankruptcy act or other similar law, or consents to the filing against it in any
petition for the appointment of a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of it or of any substantial part of its
property, or makes an assignment for the benefit of creditors, or admits in
writing its inability to pay its debts as they become due or fails to pay its
debts as they become due, or takes any action in furtherance of the foregoing;
or

     (b) There has been the calling of a meeting of creditors, appointment of a
committee of creditors or liquidating agents, or offering of a composition or
extension to creditors by, for, or of the Guarantor;

then, such Event of Default shall be deemed to constitute an event of default
under the Agreement and Kors shall be entitled immediately upon written notice
to terminate the Agreement, without prejudice to any other rights available to
Kors thereunder.

     The Guarantor hereby represents and warrants to, and agrees with, Kors that
the Guarantor has full legal right, power and authority to enter into this
Guaranty, and to perform all of its obligations hereunder.

     This Guaranty shall be binding upon the Guarantor and any and all of its
successors and assigns, and shall inure to the benefit of Kors and its permitted
successors and assigns under the Agreement. No change, modification, alteration
or discharge hereof shall be binding except by a written instrument duly
executed by the party to be bound thereby.

     This Guaranty shall be governed by and construed in accordance with, the
laws of the State of New York.

     This Guaranty and the Agreement constitute the entire agreement between the
parties hereto with respect to the subject matter hereof and thereof and
supersede all other prior agreements and understandings both written and oral
between the parties with respect to the subject matter hereof and thereof.

                                       Very truly yours,

                                       GUARANTOR:

                                       WARNACO INC.

                                       By:
                                           ------------------------------------
                                           Name:
                                           Title:

     The undersigned, Warnaco Swimwear Products Inc., understands and agrees
that (i) the occurrence of any Event of Default under the foregoing Guaranty
shall be deemed to constitute an event of default under Section 9.3 of the
Agreement with no right to cure, and that Kors shall be entitled immediately
upon written notice to terminate the Agreement, without prejudice to any other
rights available to Kors thereunder and (ii) the occurrence of any Sale Default
under foregoing Guaranty shall be deemed to constitute a breach of Section 16(b)
of the Agreement and that Kors shall be entitled to pursue all remedies
available to Kors as provided in such Section 16(b), including the termination
of the Agreement in accordance with the terms thereof..

WARNACO SWIMWEAR PRODUCTS INC.

By:
    -----------------------------------
    Name:
                                           Title:EXHIBIT
10.31

EMPLOYMENT AGREEMENT

AGREEMENT, dated as of
April 23, 2004, by and between eSpeed, Inc., a Delaware corporation,
with offices at 135 E. 57th Street, New York, New York 10022, together
with its successors and assigns (collectively,
"eSpeed"), and Kevin Foley, residing at 55
East 86th Street, Apt. 15C, New York, New York, 10028
("Employee").

eSpeed and
Employee desire to enter into an employment agreement
("Agreement"), on the terms and
conditions set forth below, to provide for the employment of Employee
for the term herein specified. In consideration of the mutual
agreements set forth below, eSpeed and Employee therefore agree:

Section 1.    Employment and Term.

eSpeed hereby
agrees with Employee, and Employee hereby agrees to serve, on the terms
and conditions set forth in this Agreement, as the President of eSpeed
with the duties set forth in Section 2, for a term beginning on May 3,
2004 (the "Start Date") and ending December
31, 2006 (the "Term of Employment"), unless
earlier terminated as specified in Section 4 below. Nothing contained
in this paragraph shall limit eSpeed's right to terminate
Employee under Section 4.

Section 2.    Duties.

Employee agrees that during the Term of Employment, Employee will
perform such duties and assignments relating to the business of eSpeed
and any entity whether now existing or hereafter arising that directly
or indirectly, through one or more intermediaries, controls or is
controlled by or under common control with eSpeed (each such entity, an
"Affiliate"), consistent with the title of
President, as the CEO of eSpeed shall direct. During the Term of
Employment, Employee shall, except during customary vacation periods
and periods of illness, devote all of Employee's business time,
attention and energies to the performance of Employee's duties
and to the business and affairs of eSpeed and to promoting the best
interests of eSpeed, and Employee shall not, either during or outside
of such normal business hours, directly or indirectly, engage in any
activity inimical to such best interests. eSpeed retains the right to
provide Employee with alternative work commensurate with the work
Employee may be asked to normally perform under this Agreement.

Section 3.    Compensation During the Term of
Employment.

eSpeed shall pay to Employee compensation as
follows:

(a)    Employee shall receive an annual base salary
of $900,000 per annum, payable semi-monthly in accordance with
eSpeed's then current payroll practices.

(b)    Employee
shall be entitled to a bonus of at least $600,000 for 2004 if the pre
tax operating earnings per share of eSpeed (in each case as customarily
reported by eSpeed) for the April 1-December 31 period in 2004 is at
least 10% higher than the pre tax operating earnings per share
for the same period in 2003. Employee shall have the opportunity to
earn an annual bonus for the 2004 fiscal year (less any amounts payable
pursuant to the preceding sentence) of up to 100% of
Employee's annual base salary, if the pre tax operating earnings
per share of eSpeed (in each case as customarily reported by eSpeed)
for the April 1-December 31 period in 2004 is at least 30%
higher than the pre tax operating earnings per share for the same
period in 2003, which amount shall be proportionately reduced in the
event of an earnings increase of less than 30%, subject to the
preceding sentence. This bonus is payable as soon as practicable
following the end of the fiscal year in accordance with eSpeed's
then current payroll practices, provided Employee has not given notice
of resignation or been terminated for Cause (as defined herein) on or
before such payment date, as the case may be. Except as provided in
this Agreement, the bonus opportunities pursuant to this paragraph (b)
will be pursuant to the terms of the eSpeed, Inc. 2003 Incentive Bonus
Compensation Plan.

Employee shall be entitled to a bonus of at
least $600,000 for 2005 if the pre tax operating earnings per share of
eSpeed (in each case as customarily reported by eSpeed) for 2005 is at
least 10% 

higher than the pre tax operating earnings per
share for 2004. Employee shall be entitled to a bonus of at least
$600,000 for 2006 if the pre tax operating earnings per share of eSpeed
(in each case as customarily reported by eSpeed) for 2006 is at least
10% higher than the pre tax operating earnings per share for
2005. Each such bonus is payable as soon as practicable following the
end of the fiscal year in accordance with eSpeed's then current
payroll practices, provided Employee has not given notice of
resignation or been terminated for Cause (as defined herein) on or
before such payment date, as the case may be.

(c)    Employee
shall also receive on the Start Date, options to purchase 500,000
shares of Class A Common Stock of eSpeed in accordance with the terms
of the eSpeed, Inc. 1999 Long Term Incentive Plan, at an exercise price
per share equal to the closing price per share of Class A Common Stock
on the Start Date, and the award agreement for such option shall be
substantially in the form attached hereto as Exhibit A.

(d)    Employee shall be entitled each year to participate in such
employee benefit plans and programs as eSpeed may from time to time
offer to employees of eSpeed. Employee will also be entitled to a
vacation or vacations in accordance with the policies of eSpeed for
employees at his level as determined by the management of eSpeed from
time to time. eSpeed shall not pay Employee any additional compensation
for any vacation time not used by Employee, other than as required by
law.

(e)    All compensation shall be subject to withholding
and other applicable taxes. Employee further agrees (i) that any sums
owed (or owing in the future) to eSpeed (or any Affiliate) by Employee
may be deducted from Employee's paychecks (or any bonus checks)
in amounts that are in accordance with applicable law and (ii) that any
sums owed to American Express and Employee's American Express
Corporate Charge Card that are 90 days past due for payment may be
deducted by eSpeed from Employee's paycheck (or any bonus checks)
in amounts that are in accordance with applicable law and make payments
to American Express on Employee's behalf and (iii) that any sums
owed to American Express and Employee's American Express
Corporate Charge Card upon the termination of Employee's
employment (for whatever reason) may be deducted by eSpeed from any
outstanding paycheck in amounts that are in accordance with applicable
law and make payments to American Express on Employee's
behalf.

(f)    Employee agrees that any unauthorized or excess
travel and entertainment expenses, as reasonably determined by eSpeed
in accordance with its then current practices, may be offset against
Employee's bonus payment or salary, at eSpeed's
discretion.

(g)    All bonuses shall be earned and payable
only if Employee is employed by eSpeed or an Affiliate at the time
payment is made (except termination of Employee without Cause);
provided, however, that bonus payments payable with respect to 2006, if
any, shall be earned and payable if Employee is employed by eSpeed or
an Affiliate on December 31, 2006. Employee agrees that any
compensation paid to Employee subsequent to the termination of
Employee's employment with eSpeed (except termination of Employee
without Cause) shall only be paid upon execution by Employee of a
general unconditional release in favor of eSpeed in a form satisfactory
to eSpeed.

Section 4.    Termination.

(a)    During the Term of Employment, eSpeed may terminate this
Agreement with Employee for Cause and notice of such termination shall
be sent to Employee. For the purposes hereof,
"Cause" means Employee's (i)
nonperformance or breach by Employee of any of the provisions of
Sections 5(a) and 5(c) of this Agreement (and with respect to any of
the provisions of Sections 5(b) and 5(d) only nonperformance or breach
by Employee which shall be material or not inadvertent), and with
respect to provisions of this Agreement other than those contained in
Section 5, material nonperformance or breach by Employee, (ii)
conviction of a crime under U.S. Federal, state or local laws or any
applicable foreign laws (including any pleas of nolo
contendere), (iii) serious misconduct in connection with or
affecting the business of eSpeed or any Affiliate, (iv) serious neglect
or gross negligence in performing Employee's duties hereunder,
(v) refusal to materially perform Employee's duties hereunder
after delivery to Employee by eSpeed or an entity owned or controlled
by eSpeed of written notice identifying the duties not being performed
by Employee, which failure may include the 

2

loss for a period of thirty (30) days during
any calendar year of any regulatory approvals or licenses necessary to
perform Employee's duties, (vi) violation by Employee or Employee
aiding and abetting any violation by another, of any law, order, rule
or regulation pertaining to Employee, or eSpeed or its affiliates
including, among others, the rules, regulations and by laws of the
National Association of Securities Dealers and the New York Stock
Exchange, (vii) illegal drug use by Employee, or (viii) serious
misconduct in connection with a request for reimbursement of expenses
not actually incurred by Employee and/or not in accordance with
eSpeed's travel and entertainment policy, or assisting others in
such efforts.

(b)    If during the Term of Employment, by
reason of physical or mental disability, Employee is incapable of
performing the essential functions of his position, with or without
reasonable accommodation for a period of 60 out of 180 consecutive
days, eSpeed at its option may thereafter terminate this Agreement with
Employee and notice of such termination may be sent to Employee. Salary
of Employee during any period of disability shall be in accordance with
the then-current policy of eSpeed. If Employee shall die during the
Term of Employment, the Term of Employment shall automatically
terminate; in the event of such death, or if eSpeed terminates the Term
of Employment pursuant to this Section, eSpeed shall pay to Employee or
to Employee's legal representatives, or in accordance with a
direction given by Employee to eSpeed in writing, Employee's
compensation to the date on which such death or termination for
disability occurs.

(c)    In the event eSpeed notifies
Employee of eSpeed's election to terminate this Agreement with
Employee, such termination shall become effective (i) if mailed, three
(3) days after mailing of notice thereof to Employee or (ii) if
delivered by hand, upon delivery.

(d)    In the event Employee
is terminated for Cause or because of disability, he will resign from
any officer and/or director positions he may hold.

		
	Section
5. 	Non-Competition;
Non-Disclosure;
Non-Solicitation; Non-Disparagement

(a)    During the Term of Employment, Employee shall not, alone or
with others, directly or indirectly, participate, engage, render
services to or become interested in (as owner, stockholder, partner,
lender or other investor, director, officer, employee, consultant or
otherwise) any business activity that is in competition with, or
otherwise related to or arises from, the then current or contemplated
business of eSpeed or any Affiliate. Notwithstanding any other
provisions herein, nothing in this Agreement shall prohibit Employee
from acquiring or owning in accordance with eSpeed's policies and
procedures regarding personal securities transactions, less than
1% of the outstanding securities of any class of any corporation
that are listed on a national securities exchange or traded in the
over-the-counter market.

(b)    Employee acknowledges that
during the Term of Employment he will have access to and become
acquainted with eSpeed's confidential records. Employee hereby
covenants and agrees that during the Term of Employment and thereafter,
Employee shall keep strictly confidential all information which
Employee presently possesses or which Employee may obtain during the
course of Employee's employment or any consulting arrangement
with eSpeed with respect to its client information, trade secrets,
copyrights, patents, trademarks, service marks, source code, business
practices, finances, developments, affairs, records, data, formulae,
documents, intangible rights, other intellectual property and other
confidential information (collectively, "Confidential
Information") of eSpeed or any Affiliate, or information
about eSpeed or any Affiliate not generally known to the public and not
disclose the same, directly or indirectly, to any other person, firm or
corporation or utilize the same, except solely in the course of
performing his duties on behalf of eSpeed and its Affiliates pursuant
to this Agreement. All Confidential Information relating to the
business of eSpeed and its Affiliates which Employee shall develop,
conceive, produce, prepare, use, construct or observe during the Term
of Employment shall be and remain the sole property of eSpeed or the
relevant Affiliate. Employee further agrees that upon the termination
of Employee's employment (irrespective of the time, manner or
cause of termination), Employee will surrender and deliver to eSpeed
all Confidential Information, including but not limited to work papers,
memoranda, lists, books, records and data of every kind, as well as any
copies thereof, relating to or in connection with eSpeed's and
its 

3

Affiliates' Confidential Information and
business. It is understood that Employee may be required to disclose
Confidential Information pursuant to subpoena, other court process, at
the direction of governmental or self-regulatory agencies (including
the National Association of Securities Dealers, Inc. or the Securities
and Exchange Commission) or otherwise as required by law.

(c)    During the Term of Employment and for a period of three (3)
years after the termination of his employment, for any reason
whatsoever, Employee shall not, alone, or with others, directly or
indirectly, solicit, hire or retain for Employee's benefit or the
benefit of any person or organization other than eSpeed and its
Affiliates, the employment or other services of any individual employed
by eSpeed or any Affiliate or serving as a consultant or independent
contractor at the time of such termination or within six months prior
thereto.

(d)    Employee recognizes that he is being placed in
a position of trust and confidence and as such will not during the Term
of Employment or thereafter defame, disparage, libel or slander eSpeed
or its Affiliates in any way, nor will eSpeed or its Affiliates defame,
disparage (except for any statements made pursuant to law or
regulation, including Regulation FD), libel or slander Employee, and
Employee will not during the Term of Employment or thereafter contact,
respond to any request from or in any way discuss, criticize, defame,
disparage, libel or slander eSpeed or its Affiliates, employees, agent
to the media (print, television, or otherwise, whether on or off the
record). This provision will not prohibit Employee from making
statements to the media if authorized by eSpeed and pursuant to eSpeed
company policy. It is expected that Employee will, in the ordinary
course of business, be expected to communicate with the media regarding
eSpeed's business.

Section 6.    Other Employee
Obligations.

(a)    In order to retain and enhance
eSpeed's standing and integrity at the forefront of the business
community, the business conduct of Employee must be totally
professional and Employee must at all times observe appropriate
standards of politeness and courtesy in Employee's behavior both
with the public and with colleagues. Employee is required to well and
faithfully serve eSpeed and to the best of Employee's ability use
Employee's best endeavors at all times to promote the development
of eSpeed's business and reputation.

(b)    Employee
must maintain the highest standards of honesty and fair dealing in
Employee's work for eSpeed and any Affiliate. Great importance is
attached to the observance of eSpeed's policies and procedures as
expressed in any personnel or compliance manual, all Federal and State
laws and regulations (or if applicable, those of a foreign
jurisdiction) and the rules of the National Association of Securities
Dealers, Inc. or any other applicable self-regulatory organization.
Material breach of any of these obligations may be regarded as
misconduct and may result in summary dismissal for Cause.

(c)    If at any time during his employment with eSpeed Employee
is, directly or indirectly, approached or solicited by a third party,
with a view to or with the intention of taking up employment or
entering into some other business relationship, whether directly or
indirectly, with that of any other party which is involved in a
business which is competitive with the current or then contemplated
business of eSpeed or any Affiliate, as known to Employee, Employee
shall disclose that fact immediately in writing to the CEO of eSpeed.
Moreover, during the Term of Employment and any extensions of
employment, Employee shall not, directly or indirectly, solicit,
encourage the solicitation of, or discuss employment or entering into a
business relationship, whether directly or indirectly with a party
which is involved in a business which is competitive with the current
or then contemplated business of eSpeed or any Affiliate, as known to
Employee.

(d)    During the Term of Employment and any
extensions thereof, Employee shall not, without the written consent of
eSpeed, enter into an agreement, whether oral, written or otherwise,
with any person, firm or corporation providing for Employee's
future employment by such or any other person, firm or corporation.

Section 7.    Injunctive Relief

The parties
acknowledge that in the event of a breach or a threatened breach by
Employee of any of Employee's obligations under this Agreement,
eSpeed and its Affiliates will not have an 

4

adequate remedy at law. Accordingly, and
notwithstanding Section 8 hereof, in the event of any such breach or
threatened breach by Employee, eSpeed and its Affiliates shall be
entitled to specific performance of this Agreement or such equitable
and injunctive relief, without proof of special damages or the posting
of any bond or other security, as may be available to restrain Employee
and any business, firm, partnership, individual, corporation or entity
participating in such breach or threatened breach from the violation of
the provisions hereof. eSpeed and its Affiliates will be entitled to
seek such relief, without the posting of any bond or other security, in
court pursuant to Section 7502(c) of the New York Civil Practice Law
and Rules, or any successor provision thereto. Nothing herein shall be
construed as prohibiting eSpeed or any Affiliate from pursuing any
other remedies available at law or in equity for such breach or
threatened breach in any dispute submitted to arbitration under Section
8 hereof.

Section 8.    Arbitration.

Subject
to the provisions of Section 7, any disputes, differences or
controversies arising under this Agreement shall be settled and finally
determined by arbitration before a panel of three arbitrators in New
York, New York, according to the rules of the National Association of
Securities Dealers, Inc. (or the American Arbitration Association or
any other alternative dispute resolution organization) now in force and
hereafter adopted and the laws of the state of New York then in effect.
The arbitrators shall make their award in accordance with and based
upon all provisions of this Agreement and judgment upon any award
rendered by the arbitrators shall be entered in any court having
jurisdiction thereof. However, it is understood and agreed that the
arbitrators are not authorized or entitled to include as part of any
award rendered by them, special, exemplary or punitive damages or
amounts in the nature of special, exemplary or punitive damages
regardless of the nature or form of the claim or grievance that has
been submitted to arbitration.

It is expressly agreed that
arbitration as provided herein shall be the exclusive means for
determination of all matters arising in connection with this Agreement
and neither party hereto shall institute any action or proceeding in
any court of law or equity other than: (a) to request enforcement of
the arbitrators award hereunder; or (b) by eSpeed to bring an action or
proceeding seeking injunctive relief from a court of competent
jurisdiction as set forth in paragraph 7. The foregoing sentence shall
be a bona fide defense to any action or proceeding instituted contrary
to this Agreement.

		
	Section 9. 	Entire
Agreement; Enforceability;
Partial Invalidity, Attorneys'
Fees.

This Agreement contains the entire agreement of the
parties with respect to the subject matter hereof and no modification
or waiver of any provision hereof will be binding upon any party unless
in writing and signed by the parties hereto.

The invalidity or
unenforceability of any particular provision of this Agreement shall
not affect the other provisions and this Agreement shall be construed
in all respects as if such invalid or unenforceable provisions were
omitted. In the event that a court of competent jurisdiction shall
determine that any covenant set forth in this Agreement is
impermissibly broad in scope, duration or geographical area, or is in
the nature of a penalty, then the parties intend that such court should
limit the scope, duration or geographical area of such covenant to the
extent, and only to the extent, necessary to render such covenant
reasonable and enforceable, and enforce the covenant as so limited.

The parties agree that if Employee brings an action, claim or
proceeding against eSpeed, any Affiliate, or any partner, stockholder,
officer, director or employee of any of them, that relates to or
implicates this Agreement, whether as to its breach, validity, efficacy
or otherwise, the non-prevailing party shall pay the reasonable
attorney's fees of the prevailing party.

5

Section
10.    Miscellaneous.

This Agreement:

(a)    shall be binding upon and inure to the benefit of the
parties hereto and their respective successors, permitted assigns,
heirs, executors and administrators. No waiver or modification shall be
deemed to be a subsequent waiver or modification of the same or any
other term, covenant or condition in this Agreement;

(b)    may not be assigned, in whole or in part, by either party
hereto without the prior written consent of the other party (any
purported assignment hereof in violation of this provision being null
and void); however, it may be assigned without recourse, in whole or in
part by eSpeed to any Affiliate or to any successor in interest of
eSpeed or any Affiliate by merger, consolidation, reorganization or
otherwise, and may be executed in various counterparts, each of which
shall be deemed an original, but all of which together shall constitute
one and the same instrument, and shall be governed by and construed in
accordance with the laws of the State of New York, without giving
effect to the principles of conflicts of laws thereof. Employee hereby
waives personal service of process, and irrevocably submits to service
of process by mail; and

(c)    shall be effective only when
executed both by eSpeed and Employee and upon such shall be binding and
enforceable; the Agreement in unsigned form does not become an offer of
any kind and does not become capable of acceptance until executed by
Employee, and at such time, the Agreement is capable of acceptance by
signature by an official at eSpeed; and

(d)    may be executed
in one or more counterparts, all of which together shall constitute but
one Agreement.

Section 11.    Notices.

All
notices pursuant to this Agreement shall be in writing, shall either be
delivered by hand or mailed by certified or registered mail, return
receipt requested, postage prepaid to the address set forth above or to
such other address as may be designated for such purpose in written
notice and shall be effective upon receipt when delivered by hand or on
the third business day after the day on which mailed. Any notice to
eSpeed hereunder will similarly be sent to:

Stephen
Merkel, Esq.
 Executive Vice President and
 General
Counsel
 ESpeed, Inc.
 135 East 57th Street
 New
York, New York 10022
 (212) 829-4829

Section 12.    No
Conflicts.

Employee represents and warrants that Employee
is not in default under, or in breach of, any agreement requiring
Employee to preserve the confidentiality of any information, client
lists, trade secrets or other confidential information or agreements
not to compete or interfere with any prior employer including, but not
limited to, any employment agreement; and neither the execution and
delivery of this agreement nor the performance by Employee of
Employee's obligations hereunder will conflict with, result in a
breach of, or constitute a default under, any confidentiality or
non-competition agreement or any employment agreement to which Employee
is a party or to which Employee may be subject.

6

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the day and year first above
written.

WITNESS

	
		
	

Name:

WITNESS

	
		
	

Name:

eSPEED,
INC.

By:   /s/ Howard W.
Lutnick

	
		
	

Name: Howard W.
Lutnick
Title: Chairman, CEO

By:   /s/   Kevin
Foley

	
		
	

Kevin
Foley

7

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