Common use of Guaranteed Minimum Royalty Clause in Contracts

Guaranteed Minimum Royalty. Commencing as of the third calendar quarter of 2021, if, for any reason, the total Royalty Revlon pays to BrandCo under Section 4.1 for any calendar year is less than the amount of the Guaranteed Minimum Royalty for such year, then within thirty (30) days after the end of such calendar year, Revlon shall pay to BrandCo the shortfall between the amounts actually paid and the Guaranteed Minimum Royalty for the applicable calendar year (the “GMR Payment”). The Parties acknowledge and agree that (a) the Guaranteed Minimum Royalty shall be (i) reduced pro-rata for calendar year 2021 solely to take into account that Revlon’s obligation to pay to BrandCo the GMR Payment commences as of the third calendar quarter of 2021 and (ii) increased by five percent (5%) on an annual basis, commencing on the first day of the third calendar quarter of 2022 and on each anniversary thereafter, and (b) if this Agreement terminates for any reason, the Guaranteed Minimum Royalty for that year shall be reduced pro-rata and the GMR Payment based on the shortfall between the amounts actually paid and the prorated Guaranteed Minimum Royalty shall be due immediately upon such termination.