PROSKAUER ROSE LLP November 12, 2004 CONFIDENTIAL FOR SETTLEMENT PURPOSES ONLY Re, — COG Ltd. v. Philippe Starck and Ubik SARL Dear Mr. Ouskrat: This letter agreement (the “Ayreement”) sets forth the terms of the settlement Ltd. (*CCG"), Cosmic Carrot Management, Ltd. (“CCM”), Ubik SARL (“Ubik"), PHS Hotels Design BY io. “PHS") ad Philippe Starck “Starek”) with respect to the CC Hotels Lid, Amended and Restated Sharebolders Agreement, dated as of May 31, 2001 {the “Sharehulders Agreement”), the hotel/residential project El Porteno in Buenos Aires, Argentina (the “Buenos Aires Project”), and the hotel/resideatial project located at Rus Joaquim Nebuco, 276/Avenida Vieira Souto, 30 in Rio de Janciro, Brazil (the “Riv Project”). All obligations of Ubik and Starck to CCG and CCM relating to the Buenos Aires Project have been completed except as set forth below. ayments, apartment sales that close prior to the end of this year shall be paid in January 2005. Future payments shall be mnade on a quarterly basis. CCG shall pay Ubik $50,000 to compensate it forthe ase of Starck’s name in connection with the promouon of the La Portena building located adjacent tu the Buenos Aires Project. CCG shall have no further right to use Starck’s name for any more purposes in this connecuon with the La Portena huilding.a y, PROSKAUER ROSE LLP Philippe Ouakrat, Esq. November 12, 2004 Page 2 Starck shall support the promotion of the Buenos Aires Project by attending the public opening of the El Porteno Hotel, conducting media interviews and participating in other promotional events. Starck shall not provide any consulting, decorative, design or architectural services for any hoteLresidential projects in Buenos Aitos until November 12, 2006. Reference is made to: The Development Agreement aniong COG and Gulf Investimentos Ltda., JM Participacoes Ltda., Samor Administracao E Participacao Ltda. and Dominus Ungenharia Ltda. (collectively, “Gull"), dated July 18, 2003 (the “Development Agreement”); The Management Agreement among Gull; OCG and CCM, dated November 26, 2002 (the “Management Agreement”); and The Design Services Agreement between Rio Universe Ltd. (*RUL”), an affiliate of Gulf, and PHS, dated as of July 26, 2004 (the “Design Agreement”). Collectively, these three agreements are referred to as the "Rio Agreements.” except to the extent that any term or condition set forth below differs from uny provision of the Rio Agreements and, in that event, this Agreement shall control, All drawings and plans by Starck/PHS shall be delivered simultaneously to CCG and GulfRUL. Starck shall send a letter to Gulf in substantially the same form as Appendix A hereto. The parties to this Agreement are releasing any and all claims they may have against each other in connection with the Rio Agreements and the Rio Project. (See Appendices B and C.) Starck, Ubik and PIS agree, however, that the release by CCG and CCM is not and shall not be construed as a waiver by CCG and/or CCM of any claims they may have agains! any other person or entity, including Gulf or RUL. Starck, Ubik and PHS furthor agree thal in any action or proceeding concerning the Rio Agreements or the Rio Projcot they will not contend dirceily or indirectly that CCG and/or CCM lacked the authority to enter into the Developrncat Agreemont or the Managenient Agreement. Starck further agrees that he shall not perform any services for any hotel/residential projects (the “Exclusive Arrangement”) located or to be located within the areas of the City of Rio de Janciro