MOSSIMO RESTATED LICENSE AGREEMENT

copyrightable, which were produced by Target or its vendors under the Prior Agreement or which are produced by Target or its vendors under this Restated Agreement.

“Trademarks” mean the MOSSIMO family of trademarks listed on Exhibit A attached hereto, any other marks incorporating the name MOSSIMO, any variations or derivations thereof, with or without stylized designs, and all common law rights and statutory rights with respect thereto, registrations thereof, applications therefor and the goodwill and other rights associated therewith, whether now existing or created hereafter.

“Exclusive Merchandise” means products which fall within the Exclusive Merchandise Categories and use the Trademarks or the Mossimo Design Materials.

“Exclusive Merchandise Categories” means products which fall within the categories identified as exclusive in Exhibit B attached hereto.

“Existing Licensees” means the licensees of the Trademarks in the Territory under license agreements outstanding as of the date hereof and identified on Exhibit C hereto.

“Existing Licensee Merchandise” means products which fall within the Exclusive Licensee Merchandise Categories.

“Existing Licensee Merchandise Categories” means products which fall within the categories licensed to Existing Licensees and identified in Exhibit B attached hereto.

“Merchandise” means the Exclusive Merchandise and the Existing Licensee Merchandise, collectively.

“Fiscal Quarter” means Target’s fiscal quarters commencing on the first business day of February, May, August and November each year.

“Net Sales” mean the sales price to customers on all sales of Exclusive Merchandise by Target (whether regular, markdown, clearance or otherwise), excluding sales tax and finance charges and, less any refunds and credits for returns actually given by Target to its customers.

“Retail Operations” means Target® Stores, Target Greatland®, Super Target®, Target.com, any other retail store operated by Target or its affiliates, and any merchandising activities conducted by Target or its affiliates in the Territory in connection therewith, including by way of example and not limitation, direct mail, kiosk, internet and websites thereon, and other wireless and electronic activities whether now known or hereafter developed.

“Territory” means the United States, its territories and possessions.

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2.                                        License Grant .

2.1                                  Exclusive License .    On the terms and subject to the conditions contained herein, Mossimo, Inc. hereby grants to Target, and Target hereby accepts, the exclusive right and license to use the Trademarks, during the Term (as defined below) and in the Territory, in connection with the design, manufacture, importation, distribution, marketing, advertising, sale and offer to sell Exclusive Merchandise.  Target will sell and offer to sell Exclusive Merchandise only through Target’s Retail Operations.  Mossimo, Inc. acknowledges and understands that Target’s marketing and advertising on the Internet or other transborder advertising will be accessible outside of the Territory, and agrees that such activities are permissible hereunder, provided that Target makes no sales to persons or entities outside of the Territory.

2.2                               Limitations .   The foregoing license does not include the right to grant sublicenses to third parties (except as provided herein in connection with the manufacture of Exclusive Merchandise and Trademark Use Materials) or the right to use the Trademarks in connection with the design, manufacture, importation, distribution, marketing, advertising, sale of any products other than the Merchandise in the manner provided herein.

2.3                               Exclusive Right .      Target shall have the exclusive right to use the Mossimo Design Materials in connection with the design, manufacture, importation, distribution, marketing, advertising, sale and offer to sell Exclusive Merchandise in the Territory.  Target will sell and offer to sell Exclusive Merchandise only through Target’s Retail Operations.  Mossimo, Inc. shall have the non-exclusive right to use the Mossimo Design Materials in connection with the design, manufacture, importation, distribution, marketing, advertising, sale and offer to sell Exclusive Merchandise outside the Territory provided that each such use shall be subject to Target’s prior approval, which approval will not be unreasonably withheld.

2.4                               Giannulli Identification .

(a)                                   Target shall have the right to use the name, signature, photograph, voice or other sound effects, likeness, personality, endorsement, biography and statements of Giannulli (the “Giannulli Identification”) for advertising and promotions relating to the Merchandise in broadcast, print, electronic and wireless media (i.e., television, radio, magazines, newspapers and free-standing inserts), direct mail, outdoor advertising (i.e., highway and means-of-transit billboards), in-store signing displays, public relations materials, the internet and websites thereon, shopping bags, in-house publications and video programs (not for broadcast or public distribution), as well as all other reasonable forms of advertising, whether now known and developed or developed hereafter.

(b)                                  Subject to the limitations set forth herein and the reasonable availability of Giannulli, Mossimo, Inc. shall cause Giannulli to attend and participate in all rehearsals, filming, taping, recording and photography sessions reasonably required to meet the obligations set forth herein (dates and times to be agreed upon by the parties), and will render his services hereunder in accordance with the scripts or other materials (including,

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but not limited to, wardrobe suggestions) provided by Target.  Mossimo, Inc. shall cause Giannulli to render his services in a competent and professional manner, to the best of his ability.  Mossimo, Inc. shall cause Giannulli to comply with Target’s reasonable instructions and recommendations related to providing such services.

2.5                                  Perpetual Right to Use .       Target retains the perpetual right to use, solely as an historical example of its advertising, any advertising and promotional materials produced by or for Target hereunder, provided that such use will be exclusively for internal and/or portfolio purposes.

3.                                        Services .

3.1                                  Mossimo, Inc. shall cause Giannulli to provide the services of a creative director in connection with the Exclusive Merchandise including but not limited to, the following (collectively, the “Services”): advice regarding brand concepts, positioning statements, themes, product and trend direction, recommendations as to trim, fabric, materials, color, marketing and packaging and such other related services as Target may reasonably request.

3.2                                  Mossimo, Inc. shall cause Giannulli to attend and participate in a reasonable number of business meetings, internal Target meetings, planning sessions, strategy meetings and any other meetings related to the planning and development of the Exclusive Merchandise, regardless of location, as requested by Target.  Mossimo, Inc. shall not be required to cause Giannulli to attend more than four (4) such meetings each Contract Year during the Term in Minneapolis, Minnesota.

4.                                        Term .

4.1                                  Initial Term .   The initial term of this Restated Agreement commenced on the Effective Date and, unless sooner terminated as provided herein, shall continue until January 31, 2010 (the “Restated Initial Term”).

4.2                                  Extended Terms .     Provided that Target is current in its payments of the Annual Guaranteed Minimum Fee (as defined below), Target shall be entitled to renew this Restated Agreement thereafter, on the same terms and conditions, for additional terms of two (2) years each (each, a “Restated Extended Term”) by giving Mossimo, Inc. written notice of its intent to renew at least one (1) year prior to the end of the then current Term.  The “Term” of this Restated Agreement shall be deemed to include the Restated Initial Term and all Restated Extended Terms, if any.  A “Contract Year” shall be deemed to refer to each period commencing February 1 and ending January 31 during the Term of the Restated Agreement.

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5.                                        Payments .

5.1                                  Fee .   During the Term of the Restated Agreement, in consideration of the rights granted to Target and the representations and warranties contained herein, Target shall pay to Mossimo, Inc. as a Fee an amount equal to the greater of (a) the Annual Guaranteed Minimum Fee applicable to such Contract Year; or (b) the applicable percentage of Net Sales for such Contract Year based on the following schedule (the “Fee”):

•                   Four percent (4%) of Net Sales on sales of Exclusive Merchandise for such Contract Year up to $100,000,000;

•                   Two and one-quarter percent (2 1/4%) of Net sales on sales of Exclusive Merchandise for such Contract Year greater than $100,000,000 up to $500,000,000; and

•                   One percent (1%) of Net Sales on sales of Exclusive Merchandise, for such Contract Year greater than $500,000,000.

5.2                                  Minimum Fees .      Target guarantees Mossimo, Inc. that during the Term of the Restated Agreement, annual Net Sales shall be not less than $350,000,000 for each Contract Year (“Minimum Net Sales”).  In the event that actual annual Net Sales are less than the Minimum Net Sales, Target shall pay to Mossimo, Inc. the difference between the Fees actually earned for such Contract Year and the Fees that would have been earned based on the Minimum Net Sales (the “Annual Guaranteed Minimum Fee”).  The Annual Guaranteed Minimum Fee shall be $9,625,000 for each Contract Year during the Term of the Restated Agreement.

5.3                                  One Time Reduction In Fees .   Mossimo, Inc. will pay to Target a one-time, nonrefundable reimbursement of Fees in the amount of $6,000,000 on or before June 30, 2006.

5.4                                  Charge-Back Against Fees .   Beginning with the Contract Year commencing February 1, 2007, Target shall charge-back and offset against the Fees otherwise due under this Agreement (including the Annual Guaranteed Minimum Fee) an amount equal to 40 basis points against Net Sales (the “Charge-Back Amount”).   Beginning July 1, 2006, Mossimo, Inc. shall be entitled to invoice Target until the end of the Contract Year 2006, and Target shall reimburse Mossimo, Inc., for its documented out-of-pocket expenses for salaries, costs of benefits and reasonable travel and related expenses actually incurred by Mossimo, Inc. after July 1, 2006 for designers (other than Giannulli) creating the Mossimo Design Materials.  Mossimo, Inc. shall submit expenses and such supporting documentation as Target may reasonably request no more often than monthly.  Expenses which comply with the foregoing will be paid within fifteen (15) days of receipt of such materials.

5.5                                  Manner of Payment .  Twenty-Five percent (25%) of the applicable Annual Guaranteed Minimum Fee shall accrue each Fiscal Quarter.  Within thirty (30) days of the end of the first Fiscal Quarter of each Contract Year during the Term of the Restated Agreement, Target shall pay to Mossimo, Inc. an amount equal to the greater of

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(a) Fees on Net Sales for such Fiscal Quarter calculated pursuant to Sections 5.1 and 5.2 above, or (b) 25% of the applicable Annual Guaranteed Minimum Fee.  Within thirty (30) days of the end of the remaining Fiscal Quarters for such Contract Year, Target shall pay to Mossimo, Inc. an amount equal to the greater of (a) the amount of the aggregate accrued Fees payable for Net Sales from the beginning of the Contract Year to the end of such Fiscal Quarter less the total of all Fees already paid for such Contract Year less any applicable Charge-Back Amount, or (b) the aggregate accrued Annual Guaranteed Minimum Fee as of the end of such Fiscal Quarter less the total of all Fees already paid for such Contract Year less any applicable Charge-Back Amount.  The foregoing provisions shall apply separately to each Contract Year, such that any excess of accrued Fees over the Annual Guaranteed Minimum Fee for any given Contract Year shall not apply toward satisfying the Annual Guaranteed Minimum Fee for any future Contract Year and shall not apply as a credit against Fees accruing in any subsequent Contract Year.  For Contract Year 2006, the Fees payable under this Agreement shall be calculated based on Net Sales beginning February 1, 2006 notwithstanding the Effective Date of this Agreement and such Fees shall be in lieu of any amounts that would have been due under the Prior Agreement.  Beginning in Contract Year 2007, the Fees payable or the applicable Guaranteed Minimum Fee Payable in each Quarter shall be reduced by the applicable Charge-Back Amount.

5.6                                  Expenses .     Each party shall be responsible for and pay its own expenses incident to performing hereunder, including without limitation, all travel and related expenses other than travel and related expenses of Giannulli in connection with marketing and promotional trips requested by Target and travel and related expenses provided for in Section 5.4.

5.7                                  Prompt Delivery .     Target acknowledges that time is of the essence in the delivery of the payments required by this Section 5, and agrees that interest shall accrue on all past due payments hereunder from their respective due dates until paid at the rate of one percent (1%) per month, or if such rate exceeds the maximum rate allowed by law, at the maximum rate allowed by law, and shall be payable on demand.

6.                                        Reports, Record Keeping and Audits .

6.1                                  Maintenance of Records .     During the Term of this Restated Agreement, Target shall keep full and accurate books of account and records in sufficient detail to show the sales of Exclusive Merchandise hereunder.  Mossimo, Inc. acknowledges and understands that such books of account and records shall be in the form and format Target maintains in the ordinary course of its business.  Such records shall be maintained for at least two (2) years after the Fiscal Quarter to which such records relate.

6.2                                  Quarterly Reports .    Within thirty (30) days of the end of each Fiscal Quarter during the Term of this Restated Agreement, Target shall prepare for its own use and the use of its auditors as provided in Section 6.3 written reports showing all sales of Exclusive Merchandise by the Retail Operations during such Fiscal Quarter with such detail as Target has historically provided under the Prior Agreement (the “Target

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Reports”).  Within thirty (30) days of the end of each Fiscal Quarter during the Term of this Restated Agreement, Target shall provide Mossimo, Inc. with written reports based on the Target Reports specifying the aggregate quarterly Net Sales, the aggregate quarterly royalty, the aggregate year to date Net Sales and the aggregate year to date royalties (the “Mossimo Reports”).  Target shall provide to Mossimo, Inc. no later than 15 days after the end of any month, aggregate sales information relating to the sale of Exclusive Merchandise during that immediately preceding month.

6.3                                  Audits .       During the Term of this Restated Agreement and for a period of one (1) year thereafter, Mossimo, Inc. shall have the right, upon written notice, to require Target to retain an independent third party auditor, reasonably acceptable to Mossimo, Inc., to examine Target’s books of account and records as are necessary to determine whether Fee payments have been accurately calculated and paid hereunder. The third party auditor shall only reveal to Mossimo, Inc. whether the Fee payments have been accurately calculated and paid or, if not, the total Net Sales and the amount of the Fee payments that should have been paid. The cost of such audit shall be borne by Mossimo, Inc.  Mossimo, Inc. shall not have the right to have an audit conducted more than once with respect any Contract Year, and in no event shall such audit occur during Target’s fourth Fiscal Quarter.  If the audit discloses that the Fee payments actually due exceed the Fee payments made, Target shall pay the unpaid Fee with interest computed as provided above for late payments.  If the audit discloses that the Fee payments made by Target exceed the Fee payments due, Mossimo, Inc. shall reimburse Target in the amount of such excess.  In addition, if the audit discloses that the Fee payments actually due exceed the Fee payments made by an amount greater than five percent (5%), the out-of-pocket costs incurred by Mossimo, Inc. in connection with the audit shall be paid by Target.

7.                                        Standards of Quality .

7.1.                               Enhancement of Trademarks ;  Quality. Target acknowledges that the Trademarks have established prestige and goodwill and are well recognized in the minds of the public, and that it is of great importance to each party that in the manufacture and sale of the Merchandise the high standards and reputation that Mossimo, Inc. has established be maintained.  Accordingly, the Exclusive Merchandise and any expression by Target, directly or indirectly, which by its nature conveys to others the existence of a relationship between Target and the Trademarks or the Exclusive Merchandise, including, without limitation, all packaging, labeling, fixturing, advertising, point of sale and sales promotion materials and product literature (any such expression referred to as “Trademark Use Materials”) shall (a) meet or exceed the quality and workmanship historically provided under the Prior Agreement and; (b) be in accordance with all of the terms and provisions of this Restated Agreement

7.2.                               Manufacture of Exclusive Merchandise .     Target shall have the right to contract the manufacture of the Exclusive Merchandise and the Trademark Use Materials bearing the Trademarks and utilizing the Mossimo Design Materials to third party manufacturers anywhere in the world, provided that (a) the manufacturer and any of its

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subcontractors sign a Manufacturer’s Trademark Agreement with Target containing comparable trademark protections for Mossimo, Inc. to the agreements being used under the Prior Agreement; and (b) the Exclusive Merchandise and Trademark Use Materials are of a quality that meets or exceeds the quality historically provided under the Prior Agreement.

7.3                                  Sampling Process .    If requested by Mossimo, Inc., Target will make available to Giannulli or another representative of Mossimo, Inc., acceptable to Target, at one or more of Target’s facilities, representative samples of the Exclusive Merchandise to enable Mossimo, Inc. to confirm that the quality standards are being satisfied.  If Mossimo, Inc. believes that any of the Exclusive Merchandise does not meet the quality standards referenced in Section 7.1, then the parties will in good faith discuss Mossimo, Inc.’s concerns and work to put in place a plan to ensure that the Exclusive Merchandise meets such quality standards.

8.                                        Existing Licensees; Duval Endorsement Agreement; and Nature of Exclusivity .

8.1                                  Sale of Existing Licensee Merchandise .     Mossimo, Inc. acknowledges that Target’s Net Sales of Existing Licensee Merchandise shall be excluded from any calculation of Fees due pursuant to Section 5 above but shall apply toward satisfying the Annual Guaranteed Minimum Fee for each Contract Year.

8.2                                  Right of First Refusal .       At such time as the license agreements with the Existing Licensees, as they relate to the Territory, expire or terminate for any reason whatsoever or Mossimo, Inc. has the unilateral right to terminate or not renew or extend such agreements, Target shall have a right of first refusal to add all or some of the affected Existing Licensee Merchandise Categories to the Exclusive Merchandise Categories hereunder.

8.3                                  Duval