EXHIBIT E
to
SCHEDULE 13D
SCREEEM! INC.
000 XXXXXX XXXXXX
XXX XXXX, XX 00000
December 10, 1998
American Retail Enterprises, L.P.
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxxx Xxxxxx
Re: Amendment No. 1 to Transitional Services and Purchase Agreement
Ladies and Gentlemen:
We refer you to that certain Transitional Services Agreement dated July 10, 1998
(the "Agreement") among Screeem! Inc., a Delaware corporation ("Screeem!"), a
Delaware corporation [sic], xXXxX*s Inc., a Delaware corporation, and American
Retail Enterprises, L.P., a New York limited partnership ("ARE"). Capitalized
terms used but not otherwise defined herein have the meanings ascribed to them
in the Agreement.
We hereby agree as follows:
1. Purchase and Sale of Inventory
a. ARE agrees to purchase from Screeem! and Screeem! agrees to sell
to ARE: (i) spring season inventory designated by Xxxx Xxxxxxxx in an amount
equal to $500,000, valued at original cost, and (ii) fall season inventory
designated by Xxxx Xxxxxxxx in an amount equal to $400,000, valued at original
cost (collectively, the "Inventory"). Screeem! shall deliver the Inventory to
ARE's New Jersey warehouse within twenty-one (21) days following the date
hereof.
2. ARE shall pay to Screeem! an amount equal to Eight Hundred Twenty-Five
Thousand Dollars ($825,000) in cash, as follows: (i) $275,000 by June 8, 1999;
and (ii) the remaining $550,000 by December 8, 1999.
3. The Transitional Services Agreement is amended in the following
respects (and otherwise shall continue in full force and effect):
a. Notwithstanding Section 4 of the Transitional Services Agreement, ARE
shall continue to provide the services set forth under the heading
"Administrative Services" on Schedule I thereof through January 31, 1999,
provided, however, that no fee shall be due under Section 2 of the Transitional
Services Agreement for services rendered during the month of January 1999.
b. Section 8 of the Transitional Service Agreement is amended by deleting
the first sentence thereof and replacing it in its entire [sic] with the
following:
"In order to secure the obligations of the Seller under Section 6(b) of
this transitional Services Agreement and under Sections 1 and 2 of this
Amendment No. 1 to the Transitional Services Agreement to indemnify the
Purchaser Indemnified Parties, parent will deposit the Additional Shares with
the Escrow Agent, to be held by the Escrow Agent in accordance with the terms of
the Escrow Agreement."
c. Distribution Services. ARE grants to Screeem! an immediate credit of
Fifty Thousand Dollars ($50,000) applicable to Screeem!'s obligation under
Section 2 of the Transitional Services Agreement relating to the fees set forth
on Schedule II thereof, such that Screeem! shall have no obligation to pay the
next $50,000 invoiced by ARE to Screeem! with respect to Distribution Services
thereunder.
4. Personnel. As of January 1, 1999, Screeem! shall hire four (4)
employees of ARE or its affiliates designated by Xxxx Xxxxxxxx who are currently
on the ARE payroll and are involved in the provision of Administrative Services
under the Transitional Services Agreement and shall assume all obligations
relating to such employees arising from and after January 1, 1998 [sic].
5. Waiver. Effective as of January 1, 1999, xXXxX*s and Xxxxxxx! hereby
waive the obligations of the Company, the Lessees and each of their Affiliates
(as such terms are defined in the Purchase Agreement) under Article XII and such
Article XII shall be of no further force or effect as of such date; provided,
however, that ARE ands [sic] Affiliates agree not to use the names "SCREEEM!" or
"XXXX COUNTRY."
6. No Duty of ARE. ARE and its Affiliates shall have no duty to xXXxX*s
(or to any of xXXxX*s affiliates) with respect to investing in, and buying and
selling securities of xXXxX*s and this Agreement shall not be interpreted to
limit or restrict such activities.
7. Acknowledgement. xXXxX*s acknowledges that it has no objection to ARE
and/or its affiliates disclosing this transaction in filings with the Securities
and Exchange Commission, subject to our approval, not to be unreasonably
withheld, the description thereof, which approval shall be a condition to the
effectiveness of this agreement.
Please confirm your agreement to the foregoing by signing and returning to us a
copy of this letter.
Very truly yours,
xXXxX*s INC.
By: /s/ Xxxx Xxxxxxx
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Xxxx Xxxxxxx, Senior VP
SCREEEM! INC.
By: /s/ Xxxx Xxxxxxx
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Xxxx Xxxxxxx, Senior VP
AGREED AND ACKNOWLEDGED:
AMERICAN RETAIL ENTERPRISES, L.P.
By: LANDMARK PANTS CORP.
General Partner
By: /s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx, Vice President
By: THE PANTS SET, INC.
General Partner
By: /s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx, President
