EXHIBIT 10.4
AGREEMENT
AGREEMENT dated as of July 5, 1999 by and among Norton XxXxxxxxxx of
Xxxxxx, Inc., a New York corporation ("Squire"), Railroad Enterprises, Inc., a
New Jersey corporation ("Railroad") and Cutting Edge Services, Inc., a New
Jersey corporation ("Cutting Edge").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the parties intend to set forth by this Agreement their mutual
understandings and covenants.
NOW THEREFORE, in consideration of the promises and mutual covenants and
agreements hereinafter set forth, and intending to be legally bound, the parties
hereto hereby agree as follows:
SECTION I
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Assets
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1.01 Subject to the terms and conditions of this Agreement and on the
basis of the representations, warranties, covenants and agreements herein
contained, at the Closing (as hereinafter defined), each of Railroad and Cutting
Edge shall sell, assign, convey and deliver to Squire, and Squire shall
purchase, acquire and accept from each of
Railroad and Cutting Edge, all of Railroad's and Cutting Edge's right, title and
interest in and to the following assets and properties (collectively, the
"Assets"):
(i) All of the fixed assets and other tangible personal property,
including without limitation, machinery, tools, equipment, furniture,
leasehold improvements, materials and supplies (collectively, the
"Property"), other than Property which is Excluded Property (as
defined in Section 1.02 below), (a) of Railroad and/or Cutting Edge
presently located at 0 Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxx Xxxxxx,
xx the one hand, and (b) of Railroad and/or Cutting Edge presently
located at 0000 Xxxxxx Xxxx, Xxxx Xxxxxxxxxx, Xxx Xxxxxx, xx the other
hand, including without limitation the Property set forth in Exhibit A
hereto;
(ii) All of Railroad's rights and entitlements under the
Agreement dated January 7, 1993, as amended or modified in any manner,
between Squire and Railroad and under any and all other agreements
(other than this Agreement) between or among Railroad, on the one
hand, and Squire, Squire's corporate parent and/or any present or
former subsidiaries, affiliates or related entities of Squire or of
Squire's corporate parent (collectively, the "Railroad Agreements"),
and all of Cutting Edge's rights and entitlements under the Agreement
dated March 17, 1993, as amended or modified in any manner, between
Squire and Cutting Edge (as the successor to Xxxx-Xxxxx Productions,
Inc.) and under any and
all other agreements (other than this Agreement and the Sublease (as
hereinafter defined)) between or among Cutting Edge, on the one hand,
and Squire, Squire's corporate parent and/or any present or former
subsidiaries, affiliates or related entities of Squire or Squire's
corporate parent (collectively, the "Cutting Edge Agreements");
(iii) All rights, remedies and benefits of each of Railroad and
Cutting Edge arising under or relating to any of the Assets, and all
causes of action and claims, known or unknown, arising therefrom,
including without limitation, rights, remedies and benefits arising
out of expressed or implied warranties from manufacturers or suppliers
of the Property; and
(iv) All products and proceeds of any of the foregoing.
1.02 It is understood and agreed that, except for the Assets, neither
Railroad nor Cutting Edge is selling, assigning or conveying to Squire, and
Squire is not purchasing, and the Assets shall not include, any of Railroad's or
Cutting Edge's right, title or interest in or to any other assets or properties
of any kind or nature, whether real, personal or mixed, or whether tangible or
intangible (the "Excluded Property").
1.03 It is understood and agreed that Squire shall not assume or be
deemed to assume and shall have no responsibility, liability or obligation with
respect to any liabilities or obligations (including but not limited to debts,
liabilities and obligations incurred by Railroad as the manager or operator of
the Assets or the provider of the
Services (as hereinafter defined)) of, or claim against, either or both of
Railroad or Cutting Edge, or of or against any present, former or future
predecessor, successor, director, officer, employee, agent, stockholder or other
affiliate of either or both of Railroad or Cutting Edge, of any kind or nature,
whether absolute, accrued, contingent or otherwise, and whether due or to become
due and whether or not asserted and whether known or unknown, and however
arising, all of which liabilities, obligations and claims Railroad and Cutting
Edge hereby agree to retain, remain solely responsible for, perform, pay and
discharge promptly as and when due (collectively, the "Excluded Liabilities").
1.04 The purchase price for the Assets shall be $5,500,000 (the
"Purchase Price"). At the Closing, Squire shall pay $3,000,000 of the Purchase
Price (the "Closing Purchase Price") in cash in immediately available funds by
bank wire transfer to an account designated by Railroad and Cutting Edge. The
balance of the Purchase Price (the "Post Closing Purchase Price") shall be paid
by Squire as follows: (i) $108,333.33 per month, payable on the last day of
each month, for nine (9) months, commencing on July 31, 1999 and ending on Xxxxx
00, 0000, (xx) $508,333.33 per month, payable on the last day of each month, for
two (2) months, commencing on April 30, 2000 and ending on May 31, 2000, (iii)
$408,333.33 on June 30, 2000 and (iv) $100,000 on December 31, 2000, all in cash
in immediately available funds by bank wire transfer to an account designated by
Railroad and Cutting Edge.
1.05 The Closing of the purchase and sale of the Assets as set forth
herein (the "Closing") shall be held at the offices of Xxxxxx & Xxxxxx, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 on the first business day following delivery to
Railroad by
Squire of the Effectiveness Notice (as defined in Section 5.16 hereof) or at
such other time, date and place as the parties shall mutually agree (such date
upon which the Closing occurs is herein referred to as the "Closing Date"). At
the Closing, (i) against payment of the Closing Purchase Price, each of Railroad
and Cutting Edge shall execute and deliver to Squire a xxxx of sale in the form
of Exhibit B hereto, (ii) Railroad, Cutting Edge and GAGU Inc., on the one hand,
and Squire, on the other hand, shall execute and deliver to each other the
general releases in the form of Exhibit C hereto, which releases shall be made
effective as of Effective Date hereof and (iii) Railroad's and Cutting Edge's
counsel, on the one hand, and Squire's counsel, on the other hand, shall execute
the stipulations of discontinuance with prejudice of all actions commenced by
Railroad and Cutting Edge in the New York Supreme Court for New York County in
the form of Exhibit D hereto and those stipulations shall be delivered to Xxxxxx
& Xxxxxx for immediate filing with the Court.
SECTION II
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Management Arrangement
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2.01 Subject to the terms and conditions of this Agreement, (i) Squire
hereby engages Railroad to manage and operate the Assets identified in Section
1.01(i)(a) hereof, all in the conduct of the services contemplated by clause
(ii) below, and (ii) in connection with the services contemplated by clause (i)
above, Squire hereby engages
Railroad to provide to Squire storage, warehousing, receiving, shipping and
distribution services at the facilities presently operated by Railroad located
at 0 Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxx Xxxxxx (the "South Hackensack
Facility") and, for so long as Railroad determines to continue to provide
Services (as defined below) at such location, at 0000 Xxxxxx Xxxx, Xxxx
Xxxxxxxxxx, Xxx Xxxxxx (or such other or different sites as shall be mutually
agreed to in writing between Squire and Railroad) (collectively, the
"Facilities"), which services shall consist of those storage, warehousing,
receiving, shipping, distribution and other services presently being provided to
Squire by Railroad at the Facilities, and, shall include, but shall not be
limited to, receiving, storing, sorting, packaging and otherwise readying
garments for shipment to Squire's customers, and inventory maintenance and
control activities (such as cycle counting and year-end audit procedures on a
basis consistent with those activities previously provided by Railroad to
Squire) (the services set forth in clauses (i) and (ii) above, hereinafter,
collectively, the "Services"). Railroad hereby accepts such engagement, and
agrees to perform all management and other services and do all things necessary
or customarily performed by managers of similar assets and providers of similar
services. It is understood and agreed that Railroad shall provide the Services
to Squire in accordance with the operating procedures now in effect between
Railroad and Squire.
2.02 (a) The term of Railroad's engagement under this Section II shall
commence on the Effective Date (as defined in Section 5.16 hereof) and shall
continue through and including June 30, 2000 (the "Term"), unless extended by
Squire, at its option by notice in writing to Railroad given, if at all, on or
before April 1, 2000, for the
months of July and August 2000 or any portion thereof (the "Extended Term"). In
the event that, after January 31, 2000, but prior to April 1, 2000, (i) Railroad
proposes, pursuant to a firm offer, to sublease to an unrelated entity the South
Hackensack Facility or (ii) Railroad proposes, pursuant to a binding agreement
with the landlord, to vacate the South Hackensack Facility upon a surrender of
the lease, in either case, it shall so notify Squire, which notice (a "Lease
Notice") shall include information in reasonable detail concerning the proposed
sublessee and the offer to sublease or the proposed surrender of lease and the
agreement with the landlord, as the case may be. Upon receipt of a Lease Notice,
Squire shall, on or before the fifth business day after the receipt of a Lease
Notice, send a notice (an "Extension Notice") to Railroad as to whether Squire
shall extend the Term to the Extended Term and the length of the Extended Term,
which extension shall be either for the month of July 2000 or the months of July
and August 2000, as selected by Squire. The failure by Squire to send an
Extension Notice within such five business day period shall constitute a waiver
by Squire of its right to extend the Term to the Extended Term.
(b) During any Extended Term, Squire agrees to ship at least 450,000
garments through Railroad per month.
2.03 In consideration for the Services, during the Term Squire shall
pay Railroad $0.34 per garment shipped by Railroad on behalf of Squire, and
during any Extended Term Squire shall pay Railroad $0.51 per garment shipped by
Railroad on behalf of Squire. Squire and Railroad understand and agree that the
price of $0.34 per
garment shipped by Railroad on behalf of Squire during the Term is based upon
Squire shipping through Railroad (or paying Railroad for the shipment of) at
least 14,000,000 garments during the period commencing on July 5, 1999 (whether
or not the Effective Date shall have occurred by such date) and ending on June
30, 2000. In order to give effect to the matters set forth in the immediately
preceding sentence and in order to provide Railroad with a predictable cash flow
during the Term, Squire and Railroad agree that, during the Term,
notwithstanding the number of garments actually shipped by Railroad on behalf of
Squire during a particular month, but prior to the point in time that Railroad
ships an aggregate of 14,000,000 garments on behalf of Squire during the period
commencing on July 5, 1999 and ending on June 30, 2000, Squire shall pay
Railroad the following aggregate fiscal monthly amounts for Services (in
addition to any other amounts payable by Squire to Railroad under and in
accordance with the express terms of this Section II) rendered during the
following fiscal months of Squire (regardless of when the Effective Date occurs,
but subject to the provisions hereof, including Sections 2.05 and 2.06 hereof):
Fiscal Month Amount
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July, 1999 $ 408,000*
August, 1999 $ 442,000*
September, 1999 $ 442,000*
October, 1999 $ 442,000*
November, 1999 $ 352,000
December, 1999 $ 352,000
January, 2000 $ 352,000
February, 2000 $ 464,000
March, 2000 $ 464,000
April, 2000 $ 464,000
May, 2000 $ 289,000
June, 2000 $ 289,000
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Total $4,760,000*
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* Payments pursuant to this Section 2.03 shall be made net of all payments made
by Squire to Railroad during July, August, September and October 1999, but prior
to the Effective Date.
Squire and Railroad understand and agree that from and after the point in time,
if any, at which Railroad has shipped an aggregate of 14,000,000 garments on
behalf of Squire during the period commencing on July 5, 1999 and ending on
June 30, 2000, payments for Services rendered by Railroad to Squire shall no
longer be made by Squire to Railroad in accordance with the table set forth
above, but rather, from and after such point in time (and prior to July 1, 2000)
shall be made in an amount equal to the actual number of garments shipped by
Railroad on behalf of Squire from and after such point in time (and prior to
July 1, 2000) multiplied by $0.34 per garment. Subject to the foregoing
provisions of this Section 2.03, all amounts payable by Squire to Railroad in
accordance with the terms of this Section 2.03 shall be paid within five
business days after receipt by Squire of the applicable invoice therefor and
Squire understands that Railroad may invoice Squire therefor on a weekly basis.
2.04 Railroad is acting under this Section II as an independent
contractor and this Agreement shall not be deemed to create an agency, joint
venture, partnership, fiduciary or an employer-employee relationship, whether
expressed or implied, between Railroad and Squire. It is understood and agreed
that Railroad shall inform all third parties that it may deal with that it is
acting solely on its own behalf hereunder and does not intend to bind or
otherwise have the power or authority to bind or obligate Squire in any manner.
Squire shall not have any liability or obligation for any debts, liabilities or
obligations of Railroad, whether or not incurred by Railroad as the manager or
operator of the Assets or the provider of the Services, all of which shall be
retained and discharged promptly as and when due by Railroad.
2.05 It is understood and agreed by Squire and Railroad that in the
event that the Effective Date is after July 5, 1999, Squire shall pay Railroad
$0.49 per garment shipped, plus a 2% box surcharge, until the Effective Date
occurs. Thereafter, following the occurrence of the Effective Date,
notwithstanding anything to the contrary contained herein (including without
limitation, Section 2.03 hereof), Railroad agrees that Squire shall be entitled
to credit against amounts otherwise owing to Railroad under this Section II an
amount equal to the product of (x) $0.17 and (y) the number of garments shipped
by Railroad on behalf of Squire subsequent to July 5, 1999 and prior to the
Effective Date, which credit shall be taken by Squire starting with the payments
first made by Squire to Railroad under this Section II following the Effective
Date.
2.06 Railroad and Squire agree that the $72,000 of unused credits
remaining as of the date hereof under the letter from Railroad to Squire dated
October 11, 1996 shall be used by Squire as credits against amounts otherwise
owing to Railroad at the rate of $6,000 per month during the 12 month period
starting July 1, 1999 and ending June 30, 2000, regardless of when the Effective
Date occurs.
2.07 It is understood and agreed by Railroad that (i) except for the
Assets identified in Section 1.01(i)(a) hereof, any and all other assets,
properties, personnel (whether hourly, salaried or independent contractor),
services (including without limitation, those of employees), materials,
supplies, machinery, equipment and space (either leased or owned) which are
necessary to the provision by Railroad of the Services to Squire, shall be
provided by, and at the sole cost and expense of, Railroad and (ii) except as
expressly provided in this Section II, Railroad shall be responsible to pay, and
hereby agrees to pay in a timely manner, all of the costs and expenses
associated with, arising out of or that are necessary to provide the Services to
Squire, which costs and expenses shall include, but shall not be limited to,
lease payments, payroll, fringe benefits and payroll taxes, real estate and all
other taxes, insurance, security services, utilities, the costs of necessary
licenses and permits, and the costs of all necessary, consistent with prior
practice, supplies, materials and other personal property. Without limiting the
generality of the foregoing, Railroad agrees to use its reasonable efforts to
maintain the services (in the provision of the Services to Squire hereunder) of
Xxxxxx Xxxxx and Xxxxx Xxxxxxxx during the Term and any Extended Term.
2.08 (a) Except as expressly set forth in Sections 2.03 and 2.09
hereof and in this Section 2.08, Squire and Railroad agree that Squire shall not
be obligated to pay Railroad or any other person, corporation or entity any
amounts for the Services and Railroad shall not charge Squire or any other
person, corporation or entity for Services. Without limiting the generality of
the foregoing, during the Term and/or the Extended Term, it is understood and
agreed that Squire shall not pay to Railroad and Railroad shall not charge
Squire (i) to remove plastic bags in which knits and sweaters are received, to
place such knits and sweaters on hangers, and to replace the plastic bag
coverings for such hung knits and sweaters, in all cases, for knits and sweaters
shipped by Railroad on behalf of Squire to Sears (collectively, the "Sears
Services"), and/or (ii) to place hangers in cartons ("seeding") for garments
shipped to members in the Federated Department Stores group and to Sak's Inc.
(b) For purposes of this Section 2.08(b), removing plastic bags,
placing knits and sweaters on hangers, replacing plastic bag coverings for knits
and sweaters, and placing hangers in cartons, are hereinafter collectively
referred to as the "Special Services." Notwithstanding the provisions of
subsection (a) of this Section 2.08, Squire shall pay to Railroad additional
charges for Special Services (i) if, after the Effective Date, an existing
customer or a new customer of Squire requires Special Services not provided by
Railroad to such customer prior to the date hereof and (ii) for shipment of
knits and sweaters to Sears, but only in the event that the number of knit and
sweater garments shipped by Railroad on behalf of Squire to Sears during the
period July 5, 1999 through June 30, 2000 (and in respect of which such Sears
Services are rendered)
exceeds 800,000 garments. The charges for Special Services rendered in
accordance with the immediately preceding sentence shall be those amounts as
heretofore in effect for such Special Services and paid by Squire to Railroad
currently, that is, $0.05 per garment for "seeding" and $0.15 per garment for
removing plastic bags, placing knits and sweaters on hangers and replacing
plastic bag coverings. It is understood and agreed that Squire shall provide to
Railroad or shall otherwise pay for the costs of the hangers and plastic bags
used by Railroad in the provision of Special Services and Sears Services.
(c) Notwithstanding the provisions of subsection (a) of this Section
2.08, in the event that Sears, May Company or the United States Army require
garments to be packed and shipped in boxes and cartons, rather than shipped on
hangers (the method of shipment presently employed by Railroad on behalf of
Squire for such customers), Squire shall pay to Railroad an additional $0.07 per
garment packed and shipped in boxes and cartons to Sears, May Company and/or the
United States Army.
2.09 In the event that, in connection with the provision of receiving
services hereunder, Railroad receives damaged or improperly loaded containers of
garments, Railroad may request Squire to consent to the provision of additional
services in respect thereof as set forth in this Section 2.09. In the event
that Squire consents to the provision by Railroad of such additional services,
Railroad shall provide such services and shall charge Squire $0.05 per garment
contained in the damaged or improperly loaded container (the "2.09 Charges").
In connection with 2.09 Charges, (i) Squire shall use its reasonable efforts to
obtain full reimbursement for such charges on behalf of
Railroad and (ii) to the extent that Squire is unable to obtain reimbursement on
behalf of Railroad within 90 days of receipt of Railroad's invoice (the "90 Day
Period") to Squire for the applicable 2.09 Charges (which invoiced 2.09 Charges
shall not exceed $0.05 per garment contained in the damaged or improperly loaded
container, and which invoice must be rendered by Railroad, if at all, within 30
days of the receipt of such container), then Squire shall pay Railroad the
greater of (the "2.09 Payment") (a) one-half of such invoiced 2.09 Charges and
(b) the amount of reimbursement, if any, actually received by Squire in respect
of the applicable 2.09 Charges (and upon any such payment, the balance of such
invoiced 2.09 Charges (after deduction of the applicable 2.09 Payment) shall no
longer be due and owing by Squire to Railroad under any circumstances). However,
it is understood and agreed by Squire and Railroad that if Squire receives
reimbursement of the applicable 2.09 Charges after it has paid one-half of the
applicable invoiced 2.09 Charges to Railroad, then Squire will promptly pay one-
half of such reimbursed amounts received to Railroad (but in any event, not in
excess of $0.05 per garment).
2.10 (a)(i) Without limiting the generality of Section 2.07, Railroad
agrees to maintain, at its sole cost and expense, the service of employees and
other service providers at levels sufficient to timely and professionally
receive, ship and otherwise provide Services on behalf of Squire on a 14,000,000
unit per annum basis. Railroad agrees that the minimum employee/service
provider base necessary to accomplish the foregoing would be Railroad's
historical employee/service provider levels for periods during which Railroad
shipped on behalf of Squire on a 14,000,000 unit per annum basis. In the event
that, notwithstanding the foregoing, (1) Railroad shall notify
Squire in writing that it will need to incur the overtime services of
employee/service providers in order to timely and professionally perform its
Services hereunder as required by Squire, or (2) Squire's representatives at the
Facilities determine that Railroad should incur overtime services of
employee/service providers in order to timely and professionally perform its
services hereunder as required by Squire, Squire agrees to reimburse Railroad
for such overtime charges which exceed $350,000 in the aggregate during the Term
and which are incurred after approval in writing by Squire (the "$350,000
Amount"). In the event that Railroad fails to maintain employee/service provider
levels consistent with the foregoing, and as a result incurs overtime charges,
or in the event that Railroad fails to obtain Squire's prior written approval
for overtime, in either such event, such overtime charges shall not count toward
the $350,000 Amount and shall not be reimbursable by Squire. In the event that
Railroad maintains employee/service provider levels consistent with the
foregoing and Squire fails to approve the incurrence of overtime charges
reasonably requested by Railroad in a specific instance, then, in such instance,
Railroad shall not be responsible for any shipping related delays in shipments
to Squire's customers.
(ii) Squire and Railroad understand and agree that the provision of
Services on Sunday and/or holidays require Railroad to incur overtime charges at
a "double time" rate as compared to overtime charges incurred on other than
Sundays or holidays which are incurred at a "time and one-half" rate.
Accordingly, for purposes of subsection (a)(i) above, and subject at all times
to subsection (a)(i) above and subsection (b) below, it is understood and agreed
by Squire and Railroad that Sunday and holiday
overtime charges shall be treated as follows: 25% of such charges shall, in all
events, be reimbursed by Squire to Railroad and 75% of such charges shall,
first, count toward the $350,000 Amount (and shall not be reimbursable or
otherwise payable by Squire) and once the $350,000 Amount is exceeded (whether
or not exceeded as a result of Sunday or holiday overtime or as a result of
other overtime, or a combination thereof), all Saturday, Sunday and holiday
overtime charges shall be reimbursed by Squire to Railroad. Squire agrees to use
its reasonable efforts to schedule order shipment start and cancel dates which
are not on Sundays or holidays.
(b) Notwithstanding the provisions of subsection (a) above or (c)
below, Squire agrees to reimburse Railroad for overtime charges which are
incurred after approval in writing by Squire in the event that Railroad is
required to incur overtime to render Services hereunder as a result of (i) the
failure by Squire to notify Railroad at least 48 hours in advance (or 72 hours
in advance if Special Services are required) of Squire's requirement to process
purchase orders, (ii) the failure of merchandise to arrive at or otherwise to be
available at the Facilities for shipment prior to the foregoing 48 hour period
(or 72 hour period in the case of Special Services requirements), or (iii) the
failure by Squire to deliver to Railroad pack-slips prior to the foregoing 48
hour period (or 72 hour period in the case of Special Services requirements).
(c) Railroad shall use its best efforts to ship garments covered by a
particular purchase order as close as possible to the date (the "start date") on
which the particular purchase order permits such garments to be shipped,
provided that Railroad
shall not be responsible to Squire in the event that, despite the use of its
best efforts as aforesaid, all of the garments which are the subject of the
particular purchase order are not shipped by Railroad as close as possible to
the applicable start date.
(d) It is understood and agreed by Railroad and Squire that it is
their intention to minimize overtime charges in the conduct of the Services
hereunder. In furtherance of the foregoing, Squire and Railroad agree to
consult in good faith with each other concerning the proposed incurrence by
Railroad of overtime, all in order to minimize the incurrence by Railroad of
overtime.
2.11 Squire agrees to use its reasonable efforts, consistent with its
existing procedures, to obtain reimbursement in a timely manner from customers
for all contested (by Squire) shipping or distribution related deductions or
chargebacks from Squire customer payments (the "Squire Contested Chargebacks"),
and to notify Railroad, on a weekly basis, of all shipping and distribution
related deductions or chargebacks which are in excess of $2,500. Subject to the
next sentence of this Section 2.11, in the event of (i) Squire Contested
Chargebacks where Squire is unable to obtain such reimbursement from the
applicable customer within a period of four months following its first attempt
to do so ("Written Off Squire Contested Chargebacks") and (ii) uncontested (by
Squire) shipping or distribution related deductions or chargebacks (the "Squire
Uncontested Chargebacks"), then, in either event, Railroad shall pay Squire for
one-half of all such shipping or distribution related deductions or chargebacks
(whether Written Off Squire Contested Chargebacks or Squire Uncontested
Chargebacks), all within 20 days of receipt of a request therefor from Squire (a
"Request"). Notwithstanding the foregoing, Squire shall not seek payment from
Railroad during the term of this Agreement in excess of $450,000 of Written Off
Squire Contested Chargebacks and Squire Uncontested Chargebacks (that is
$225,000 of potentially reimbursable amounts from Railroad), and of this amount
(a) Railroad shall not be required to pay Squire in respect of the first $80,000
(that is, but for this clause (a), Railroad would be required to reimburse
$40,000 to Squire) of Written Off Squire Contested Chargebacks and Squire
Uncontested Chargebacks and (b) with respect to the next $370,000 (that is, in
respect of the next $185,000 of reimbursable amounts by Railroad) of Written Off
Squire Contested Chargebacks and Squire Uncontested Chargebacks, Railroad shall
pay Squire for one-half of all such shipping or distribution related deductions
or chargebacks within 20 days of a receipt of a Request, provided that Railroad
shall have the right, by notice ( a "Dispute Notice") to Squire, given, if at
all, within 20 days of receipt by Railroad of the applicable Request, to require
Squire to contest any Uncontested Squire Chargeback which is in excess of
$5,000, which Dispute Notice shall be accompanied by information that such
Uncontested Squire Chargeback was, in fact, not the result of action or inaction
by Railroad in the provision of Services hereunder (which information must
include more supporting evidence with respect to the particular deduction or
chargeback in question than an assertion by Railroad that such Uncontested
Squire Chargeback was not caused by action or inaction of Railroad), whereupon
Squire shall, at its option, either (1) use its best efforts to obtain
reimbursement from customers for such Uncontested Squire Chargebacks (and
failing such reimbursement within the four-month period as aforesaid, Railroad
shall pay Squire
for one-half of all such Uncontested Squire Chargebacks within 20 days of
receipt of a Request) or (2) waive its right under this Section 2.11 to require
Railroad to pay Squire for one-half of such Uncontested Squire Chargebacks (and
thereupon Squire shall not be required to use its reasonable efforts to obtain
reimbursement from customers), and in the event of such a waiver it is
understood that Squire is not seeking reimbursement of such an Uncontested
Chargeback from Railroad and the amount of such Uncontested Chargeback shall not
be included in the $450,000 cap. The failure by Railroad to send a Dispute
Notice within the aforementioned 20-day period after receipt of a Request shall
constitute a waiver by Railroad of its right to require Squire to contest the
Uncontested Squire Chargebacks which are the subject of such Request.
Notwithstanding the foregoing, the foregoing provisions of this Section 2.11
shall not be applicable in the event that the shipping and distribution related
deductions or chargebacks result from Railroad's reckless or willful misconduct
in the provision of Services hereunder, and rather, in such case, Railroad shall
reimburse Squire for all of such shipping or distribution related deductions or
chargebacks within 20 days of receipt of a Request in respect thereof. For
purposes hereof, shipping or distribution related deductions or distribution
related chargebacks include, but are not limited to, Advanced Shipping Notice
("ASN") integrity violations or discrepancies, concealed shortages, concealed
overages, unauthorized color, style or size substitutions, packing slip errors,
and carton labeling errors.
2.12 (a) During the period of Railroad's engagement under this
Section II, (i) Railroad shall (1) at any time during normal business hours and
during any other
time during which Railroad is providing Services at a facility(s),and without
prior notice or approval of visitors and (2) at any time other than during
normal business hours and other than during any time at which Railroad is
providing Services at a facility(s), without approval of visitors and upon
reasonable prior notice (which may be telephonic), in either case, provide to
Squire, its employees and consultants unrestricted access to all facilities
(including the Facilities) at which Railroad is conducting the Services, (ii)
except commencing on May 1, 2000, Railroad shall not perform services similar to
the Services for any other person, corporation or entity, (iii) Railroad shall
not subcontract with any other person, corporation or entity to render all or
any portion of the Services to Squire and (iv) Squire may engage other persons,
corporations or entities to render Services (or similar services) to it.
(b ) During the period of Railroad's engagement under this Section II
and for a period of six months thereafter, at any time during normal business
hours and upon two day's prior notice (which may be telephonic) (i) Railroad
shall provide to Squire, its employees and consultants reasonable access to all
of Railroad's books and records concerning the subject matter of Sections 2.08,
2.09, 2.10 and 2.11 hereof and (ii) Squire shall provide to Railroad, its
employees and consultants reasonable access to all of Squire's books and records
concerning the subject matters of Section 2.11 hereof. In addition to the
foregoing, under the foregoing circumstances, Squire and Railroad may make
copies of the relevant books and records concerning the above-mentioned subject
matters.
2.13 Effective on the Effective Date, each of the Railroad Agreements
and the Cutting Edge Agreements are hereby irrevocably and unconditionally, and
without the payment of any amount or other act whatsoever, terminated and
superseded by this Agreement, and those Agreements shall be of no further force
or effect. Without limiting the generality of the foregoing, effective on the
Effective Date, no party to any of the Railroad Agreements or the Cutting Edge
Agreements, and no other person, corporation or other entity (including without
limitation, the corporate parent of Squire and each other subsidiary or
affiliate, direct or indirect and whether now existing or hereafter created or
acquired, of such corporate parent), shall have any liability or obligation
under, pursuant to, by reason of, or arising out of the Railroad Agreements or
the Cutting Edge Agreements or any of the services or transactions contemplated
by the Railroad Agreements or the Cutting Edge Agreements.
SECTION III
-----------
Lease Matters
-------------
3.01 Upon 30 days prior notice to Cutting Edge, Squire may terminate
the Sublease dated January 17, 1994 , as amended (the "Sublease"), covering
subleased space at 0000 Xxxxxx Xxxx, Xxxx Xxxxxxxxxx, Xxx Xxxxxx, provided that
Cutting Edge and Squire hereby agree that such Sublease shall automatically
terminate and shall be of no further force or effect on December 31, 1999
without further action on the part of
Squire. Within 30 days of the termination of the Sublease, Cutting Edge shall
return to Squire in cash its $40,000 security deposit (the "Security Deposit").
3.02 (a) On or prior to January 31, 2000, Railroad agrees to obtain
the irrevocable and unconditional release of Squire, in form and substance
reasonably satisfactory to Squire, without payment of any amount by Squire or
penalty to Squire, of the Guaranty (the "Guaranty") dated May 19, 1992 in favor
of 0 Xxxxxx Xxxxxxxxx Associates (the "Railroad Release"). In the event that
the Railroad Release is not obtained prior to such date, Railroad agrees that
Squire shall withhold $500,000 from the Post Closing Purchase Price payments
scheduled to occur after such date, commencing with the Post Closing Purchase
Price payment scheduled to occur on February 28, 2000. In the event that the
Railroad Release is obtained after January 31, 2000, then Squire shall pay
Railroad within five (5) business days of the receipt of the Railroad Release an
amount equal to (i) any and all Post Closing Purchase Price payments (up to
$500,000 in the aggregate) so withheld from Railroad less (ii) any and all
amounts paid by Squire to the landlord that were required to be paid under the
Guaranty. In the event that Squire receives a Lease Arbitration Determination
(as defined in subsection 3.04 below) in respect of the Guaranty and the
Railroad Lease (as defined in subsection 3.04 below), then Squire shall pay
Railroad within five (5) business days of the receipt of such Lease Arbitration
Determination the amount set forth in such Lease Arbitration Determination,
provided that, under no circumstances (and notwithstanding anything to the
contrary contained in such Lease Arbitration Determination), shall such amount
exceed (a) any and all Post Closing Purchase Price Payments (up to $500,000 in
the aggregate) so
withheld from Railroad less (b) any and all amounts paid by Squire to the
Landlord under the Guaranty. In the event that neither a Railroad Release nor a
Lease Arbitration Determination in respect of the Guaranty and the Railroad
Lease is received by Squire, as and to the extent that the applicable statute of
limitations expires with respect to amounts which, but for such expiration,
would be payable by Squire to the landlord under the Guaranty (the "Railroad
Expiration Amounts"), Squire shall pay Railroad within five (5) business days of
such expiration (1) the applicable Railroad Expiration Amounts (to the extent of
any and all Post Closing Purchase Price Payments so withheld from Railroad, not
to exceed $500,000 in the aggregate), less (2) any and all amounts paid by
Squire to the landlord that were required to be paid under the Guaranty.
(b) In the event that the landlord under the Guaranty commences an
action in a court of competent jurisdiction to require Squire to pay amounts
allegedly owing under the Guaranty, Squire shall notify Railroad of such action
and shall reasonably cooperate, at Railroad's sole cost and expense, with
Railroad and its counsel in connection with such action. In the event that
Squire determines that there is no reasonable likelihood that the entire amount
payable by Squire under the Guaranty could reasonably be the subject of such
action, Squire shall pay to Railroad the amount of any and all Post-Closing
Purchase Price Payments (up to $500,000 in the aggregate) withheld from Railroad
pursuant to subsection (a) above which are in excess of the amounts so
determined by Squire to be (or reasonably could be) the subject of such action.
3.03 (a) On or prior to January 31, 2000, Cutting Edge agrees to
obtain the irrevocable and unconditional release of Squire, in form and
substance reasonably
satisfactory to Squire, without payment of any amount by Squire or penalty to
Squire, of the Limited Guaranty (the "Limited Guaranty") dated December 30, 1993
in favor of Xxxxx Management Inc. (the "Cutting Edge Release"). In the event
that the Cutting Edge Release is not obtained prior to such date, Cutting Edge
agrees that Squire shall withhold $300,000 from the Post Closing Purchase Price
payments scheduled to occur after such date, commencing with the Post Closing
Purchase Price payment scheduled to occur on February 28, 2000. In the event
that the Cutting Edge Release is obtained after January 31, 2000, then Squire
shall pay Cutting Edge within five (5) business days of the receipt of the
Cutting Edge Release an amount equal to (i) any and all Post Closing Purchase
Price payments (up to $300,000 in the aggregate) so withheld from Cutting Edge
less (ii) any and all amounts paid by Squire to the landlord that were required
to be paid under the Limited Guaranty. In the event that Squire receives a Lease
Arbitration Determination in respect of the Limited Guaranty and the Cutting
Edge Lease (as defined in subsection 3.04 below), then Squire shall pay Cutting
Edge within five (5) business days of the receipt of such Lease Arbitration
Determination the amount set forth in such Lease Arbitration Determination,
provided that, under no circumstances (and notwithstanding anything to the
contrary contained in such Lease Arbitration Determination), shall such amount
exceed (a) any and all Post Closing Purchase Price Payments (up to $300,000 in
the aggregate) so withheld from Cutting Edge less (b) any and all amounts paid
by Squire to the Landlord under the Guaranty. In the event that neither a
Cutting Edge Release nor a Lease Arbitration Determination in respect of the
Limited Guaranty and the Cutting Edge Lease is received by Squire, as and to the
extent that the applicable statute of limitation expires with respect to amounts
which, but for such expiration, would be
payable by Squire to the Landlord under the above-mentioned Guaranty (the
"Cutting Edge Expiration Amounts"), Squire shall pay Cutting Edge within five
(5) business days of such expiration (1) the applicable Cutting Edge Expiration
Amounts (to the extent of any and all Post Closing Purchase Price Payments so
withheld from Cutting Edge, not to exceed $300,000 in the aggregate), less (2)
any and all amounts paid by Squire to the landlord that were required to be paid
under the Limited Guaranty.
(b) In the event that the landlord under the Limited Guaranty
commences an action in a court of competent jurisdiction to require Squire to
pay amounts allegedly owing under the Limited Guaranty, Squire shall promptly
notify Cutting Edge of such commencement and shall reasonably cooperate, at
Cutting Edge's sole cost and expense, with Cutting Edge and its counsel in
connection with such action. In the event that Squire determines that there is
no reasonable likelihood that the entire amount payable by Squire under the
Limited Guaranty could reasonably be the subject of such action, Squire shall
pay to Cutting Edge the amount of any and all Post-Closing Purchase Price
Payments (up to $300,000 in the aggregate) withheld from Cutting Edge pursuant
to subsection (a) above which are in excess of the amounts so determined by
Squire to be (or reasonably could be) the subject of such action.
3.04 For purposes hereof, a "Lease Arbitration Determination" shall
mean a written determination by the Arbitrator (as defined in Section 5.07
hereof) pursuant to Section 5.07 hereof that (i) Railroad or Cutting Edge, as
applicable, has fully discharged and paid all amounts owing and all obligations
under the Railroad Lease or
the Cutting Edge Lease, as applicable, (ii) that Railroad or Cutting Edge, as
applicable, has completely vacated the premises which were the subject of the
Railroad Lease or the Cutting Edge Lease, as applicable, (iii) that the
Arbitrator has satisfactorily confirmed with the applicable landlord, or has
otherwise satisfactorily confirmed, that the matters set forth in clauses (i)
and (ii) above have occurred and (iv) there is no reasonable basis upon which
the Arbitrator could conclude that Squire has any remaining liabilities or
obligations to the applicable landlord under the Guaranty or the Limited
Guaranty, as applicable. Also for purposes hereof, the "Railroad Lease" shall
mean the Indenture of Lease dated May 15, 1998 between 0 Xxxxxx Xxxxxxxxx
Associates and Railroad Enterprises, Inc., as amended from time to time,
covering the building located at 0 Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxx
Xxxxxx and the "Cutting Edge Lease" shall mean the Agreement of Lease dated as
of December 23, 1993 between Xxxxx Management Inc., as agent for 00-00 Xxxxx
Xxxxxxx Xxxxxx Associates, L.P. and Xxxx Xxxxx Productions, Inc. (as successor
to Cutting Edge), as amended from time to time, covering the building located at
0000 Xxxxxx Xxxx, Xxxx Xxxxxxxxxx, Xxx Xxxxxx.
SECTION IV
----------
Consulting Services
-------------------
4.01 Subject to the terms and conditions of this Agreement, Squire
hereby engages Railroad to provide consulting services, and Railroad hereby
accepts such engagement. The consulting services shall consist of advising
Squire concerning the
relocation of Squire's warehousing, receiving, shipping and distribution
functions to South Carolina, including, but not limited to, matters concerning
the implementation of management information systems, the layout of material
handling and staging equipment, and storage fixturing. Such consulting services
may be rendered by telephone, shall not require the preparation or submission of
written reports by Railroad and shall not require travel other than to Squire's
offices in New York City, provided that, at Squire's request and at its cost and
expense, one trip to Squire's South Carolina facility may be required by Squire
of the consultant hereunder.
4.02 The term of Railroad's engagement under this Section IV shall
commence on the Effective Date and shall continue through and including June 30,
2000.
4.03 In consideration of the consulting services contemplated by this
Section IV, Squire shall pay to Railroad a monthly consulting fee, for 12
consecutive months, of $41,666.67 (that is, a total of $500,000) on the last day
of each month commencing on July 31, 1999 and terminating on June 30, 2000. In
acting under this Section IV, except as expressly provided in Section 4.01
above, Railroad shall be responsible for all of its own costs and expenses
incurred in rendering the consulting services contemplated hereby and shall be
acting as an independent contractor and this Agreement shall not be deemed to
create an agency, joint venture, partnership, fiduciary or employer-employee
relationship, whether expressed or implied, between Railroad and Squire.
4.04 It is understood and agreed by Squire that Railroad may assign
the right to receive consulting fees pursuant to Section 4.03 hereof and may
delegate the obligation to perform consulting services pursuant to Section 4.01
hereof, provided that such assignee and/or delegatee (and in the case of a
corporation or other entity, its officers, directors and stockholders or other
owners) are fully disclosed in writing to Squire and are approved in writing by
Squire, which approval shall not be unreasonably withheld. Any purported
assignment or delegation in violation of the foregoing shall be void and of no
force or effect.
SECTION V
---------
Miscellaneous
-------------
5.01 It is understood and agreed by the parties hereto that, in
addition to the setoff rights contemplated by Sections 3.02 and 3.03 hereof, in
the event that (i) Railroad or Cutting Edge, as the case may be, shall fail to
pay and discharge Excluded Liabilities and, as a result thereof, liability,
responsibility or payment therefore is asserted against Squire or any of its
affiliates, (ii) Railroad shall fail to reimburse Squire, from time to time,
under the circumstances set forth in Section 2.11 hereof or (iii) Cutting Edge
shall fail to return the Security Deposit to Squire as contemplated by Section
3.01 hereof, then Squire may (in addition to any other rights or remedies
available to it at law or in equity) setoff any and all of the foregoing amounts
against (a) the Post Closing Purchase Price payments thereafter otherwise due
and owing by Squire, (b) payments otherwise due and owing by Squire under
Section 2.03 hereof and/or (c) payments
otherwise due and owing by Squire under Section 4.03 hereunder.
5.02 Railroad and Cutting Edge hereby represent and warrant to Squire
and Squire that:
(i) Each of Railroad and Cutting Edge is a corporation duly
authorized, validly existing and in good standing under the laws of
the State of New Jersey;
(ii) The execution and delivery by Railroad and Cutting Edge of
this Agreement (and of the instruments and agreements attached hereto
as Exhibits), the performance by Railroad and Cutting Edge of their
respective covenants and agreement hereunder and thereunder, and the
consummation by Railroad and Cutting Edge of the transactions
contemplated hereby and thereby have been duly authorized by all
necessary corporate action;
(iii) This Agreement constitutes (and upon the execution and
delivery of the instruments and agreements attached hereto as
Exhibits, each such instrument and agreement shall constitute) a valid
and legally binding obligation of each of Railroad and Cutting Edge
only, enforceable against Railroad and Cutting Edge only in accordance
with its terms, subject as to enforceability to applicable bankruptcy,
insolvency, reorganization and similar laws affecting creditors'
rights and to general
principles of equity;
(iv) The Assets shall be sold to Squire free and clear of all
liens, security interests, mortgages, encumbrances, charges or adverse
claims whatsoever;
(v) Railroad has received a written assurance from the vendor
thereof that the security systems located at the Facilities are or
will be "Year 2000" compliant on or before December 31, 1999, and has
or will timely pay for any and all upgrades to such security systems
recommended by such vendor in order to cause such security systems to
be "Year 2000" compliant on or before such date; and
(vi) The combined net income before taxes of Railroad and Cutting
Edge for the fiscal year ended December 31, 1998 was less than
$388,000.
5.03 Squire hereby represents and warrants to Railroad and Cutting
Edge that:
(i) Squire is a corporation duly authorized, validly existing
and in good standing under the laws of the State of New York;
(ii) The execution and delivery by Squire of this Agreement (and
of the instruments and agreements attached hereto as Exhibits), the
performance by Squire of its covenants and agreements hereunder and
thereunder, and the consummation by Squire of the transactions contemplated
hereby and thereby have been duly authorized by all necessary corporate
action; and
(iii) This Agreement constitutes (and upon the execution and
delivery of the instruments and agreements attached hereto as Exhibits,
each such instrument and agreement shall constitute) a valid and legally
binding obligation of Squire only, enforceable against Squire only in
accordance with its terms, subject as to enforceability to applicable
bankruptcy, insolvency, reorganization and similar laws affecting
creditors' rights and to general principles of equity.
5.04 All notices, requests or instructions hereunder shall be in
writing and delivered personally, sent by telecopy, sent by registered or
certified mail, return receipt requested, or sent by Federal Express or any
other nationally recognized overnight courier service, as follows:
(a) If to Railroad or Cutting Edge:
0 Xxxxxx Xxxxxxxxx
Xxxxx Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: President
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx Xxxxxx & Xxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
(b) If to Squire:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Cost, Esq.
Telecopy No.: (000) 000-0000
Any of the above addresses may be changed at any time by notice given as
provided above; provided, however, that any such notice of change of address
shall be effective only upon receipt. All notices, requests or instructions
given in accordance herewith shall be deemed received (i) on the date of
delivery, if hand delivered or telecopied, (ii) on the next business day after
sending, if sent by Federal Express or any other recognized overnight courier
service, or (iii) on the third business day after mailing, if mailed by
registered or certified mail, return receipt requested.
5.05 This Agreement (including the Exhibits hereto) contains the
entire agreement among the parties hereto with respect to the matters and
transactions contemplated hereby and supersedes all prior agreements (including
without limitation, the Railroad Agreements and the Cutting Edge Agreements),
promises, understandings, negotiations and discussions, whether written or oral
or implied from any course of dealing, of the parties, and no amendment,
modification or change hereof shall be effective unless in writing and signed by
the parties hereto.
5.06 Except as otherwise expressly provided herein, each of the
parties hereto shall bear such party's own costs and expenses in connection with
this Agreement and the transactions contemplated hereby.
5.07 The parties hereto agree that any controversy or claim by one
party against another party arising out of or relating to this Agreement, or the
performance or the breach thereof, shall be submitted to binding arbitration in
New York City, which arbitration shall be determined in accordance with the
terms, conditions, rules and procedures as set forth in this Section 5.07,
except that the parties are expressly permitted
to seek injunctive or other equitable relief against another party from any
court of competent jurisdiction to the extent they are entitled to such relief
at law or equity.
(a) The parties shall cooperate in good faith to designate a person by
mutual agreement to act as the sole arbitrator of any controversy or claim
submitted for arbitration under this Agreement (the "Arbitrator"). That
designation, if any, shall be confirmed in writing signed by the parties or
counsel on behalf of the parties. If the parties do not designate such a
person, the Arbitrator shall be selected as provided in subsection (u) below.
(b) Any party may initiate an arbitration of any dispute arising out
of or relating to this Agreement as provided in this Section 5.07. Arbitration
under this Section 5.07 shall be initiated in the following manner:
(i) The initiating party or its authorized representative (the
"Claimant") shall give written notice to the Arbitrator and the other party (the
"Respondent") of its intention to arbitrate (the "Demand"), which notice shall,
with reasonable particularity, describe the matter to be arbitrated, including
the nature of the dispute, the amount involved, if any, and the remedy sought.
(ii) The Respondent shall then, within five (5) business days from the
receipt of the Demand, submit a written answering statement to the Arbitrator
and the Claimant, unless the parties agree in writing, or the Arbitrator
determines, to give the Respondent additional time to respond to the Demand. If
no answering statement is submitted within the stated time, the Arbitrator will
deem the claims in the Demand as denied by the Respondent.
(iii) If Respondent's answering statement asserts a counterclaim,
that
statement shall set forth with reasonable particularity the nature of the
counterclaim, the amount involved, if any, and the remedy sought. The Claimant
shall then, within five (5) business days from the receipt of the answering
statement with counterclaim, submit to the Arbitrator and the Respondent a
written statement answering the counterclaim, unless the parties agree in
writing, or the Arbitrator determines, to give the Claimant additional time to
respond to the counterclaim. If no response to the counterclaim is submitted
within the stated time, the Arbitrator will deem the counterclaim to be denied
by the Claimant.
(iv) The Demand, Respondent's answering statement, and Claimant's
response to counterclaims (if any), are collectively referred to herein as "the
Pleadings." Upon the later of (1) the receipt by the Arbitrator of all the
applicable Pleadings; or (2) the last date by which a party was to respond to
the Demand or answering statement with counterclaim, as the case may be, and no
response was timely submitted, then the Arbitrator shall deem the Pleadings
closed and the claim or controversy submitted (the "Submission Date").
(c) The parties agree that an arbitration Demand may be made at any time
and that multiple Demands may be made relating to separate controversies or
claims that arise between the parties. The fact that a particular controversy or
claim has been initiated, submitted or is awaiting decision by the Arbitrator
shall not preclude the initiation of any additional controversy or claim for
arbitration. The Arbitrator shall try to combine all Demands and claims into a
single proceeding, if possible.
(d) In arbitration under this Section 5.07, any party may be represented by
counsel or other authorized representative.
(e) After the Submission Date, the Arbitrator shall have sole discretion to
determine whether or not a hearing shall be scheduled to determine the issue(s)
submitted for arbitration, require an appearance by the parties and/or the
presentation of evidence and witnesses, or whether the parties shall be required
to submit to the Arbitrator any additional materials. The Arbitrator shall
inform the parties in writing whether or not a hearing will be scheduled.
(f) In connection with a hearing scheduled by the Arbitrator:
(i) The Arbitrator will schedule such a hearing as expeditiously as
possible after the Submission Date.
(ii) At least seven (7) days prior to the hearing date, the parties
will exchange the names of all individuals and/or experts whom they expect to
call as witnesses at the hearing. With respect to any expert witnesses, the
parties will further identify the area of expertise of each such expert and the
substance of the expert's anticipated testimony.
(iii) At least seven (7) days prior to the hearing date, the parties,
if they so elect, may submit a pre-hearing memorandum to the Arbitrator. A party
submitting a pre-hearing memorandum shall submit the original of such memorandum
to the Arbitrator and simultaneously serve a copy by hand on the adverse party
or its representative.
(iv) At least seven (7) days prior to the hearing date, the parties
shall send to each other and to the Arbitrator a list of documents to be
submitted at the hearing, together with a copy of any listed document not
previously provided.
(v) All testimony at the hearing shall be given under oath, as
administered by the Arbitrator.
(g) Prior to any scheduled hearing date, the parties shall have the right
to take depositions and to request documents on a reasonable, limited and
expedited basis, subject to the approval of the Arbitrator.
(h) The parties may offer such evidence as they consider relevant and
material to the dispute and shall produce such evidence as the Arbitrator may
deem necessary to an understanding and determination of the dispute.
(i) The Arbitrator shall have the following powers:
(i) To request any information from the parties or from third parties
to the extent to which the Arbitrator deems it necessary and/or relevant to the
determination of the dispute.
(ii) To subpoena witnesses or documents to the extent to which the
Arbitrator deems it necessary and/or relevant to the determination of the
dispute.
(iii) To rule on the admissibility of evidence. The Federal Rules of
Evidence shall be used as guidelines for the admissibility of evidence, but at
the Arbitrator's sole discretion the Arbitrator shall not be required to
strictly adhere to the Federal Rules of Evidence.
(iv) To determine whether to require the attendance of a particular
witness to testify at a hearing and be subject to cross-examination, or to
otherwise provide information to the Arbitrator to assist in the determination
of the controversy or claim to be decided.
(v) To require witnesses to testify under oath.
(vi) To make rulings on any motion and to issue such orders for
interim
relief as may be deemed necessary to safeguard the property that is the subject
matter of the arbitration, without prejudice to the rights of the parties in the
final determination of the dispute.
(vii) To determine jurisdictional and arbitrability disputes between
the parties to this Agreement only, including disputes over the existence,
validity, interpretation or scope of this subsection under which arbitration is
sought and/or how it is conducted, except that it is expressly agreed that the
Arbitrator is prohibited from limiting in any way the rights to seek injunctive
or equitable relief from any court as provided in this Section or from
permitting the joinder of any entity to the arbitration that is not a signatory
to this Agreement.
(viii) To resolve disputes about the interpretation and applicability
of the rules and procedures set forth in this arbitration section, including
disputes relating to the duties of the Arbitrator, the conduct of pre-hearing
activities and the conduct of the hearing.
(ix) To schedule, at any juncture of the proceedings, a conference
with the parties to the extent that the Arbitrator determines it will help
facilitate and expedite the disposition of the action. At such a conference, if
the Arbitrator so elects, the Arbitrator may have conferences with each party
separately and, to that end, attempt to mediate the dispute.
(j) If a matter is called for a hearing and either party appears but the
other does not, the Arbitrator shall either hear the case and enter an award or
grant a continuance.
(k) Any controversy or claim submitted for arbitration may be dismissed,
without prejudice, before final adjudication, by a stipulation of dismissal
signed by all parties.
(l) A decision or award issued by the Arbitrator shall be in writing,
signed by the Arbitrator, and may be rendered in a conclusory fashion without
written, detailed explanation of the reasons for the Arbitrator's decision or
award, if the Arbitrator so elects.
(m) The Arbitrator is authorized to award any remedy or relief that the
Arbitrator deems just and equitable and within the scope of the Agreement,
including, but not limited to, specific performance of the Agreement and pre- or
post-judgment interest. The Arbitrator may also award attorneys' fees and
expenses to the prevailing party in the event the Arbitrator concludes that a
party did not act in good faith.
(n) The award of the Arbitrator shall be final, binding and enforceable on
its own terms.
(o) The Arbitrator will issue the award, determining the matters submitted
to the Arbitrator, as expeditiously as possible, but in no event more than ten
(10) days after the later of (i) the Submission Date; (ii) the last date upon
which any party or third party is required to respond to any request from the
Arbitrator for further information; or (iii) the conclusion of all hearings
before the Arbitrator.
(p) If the parties settle their dispute during the course of the
arbitration, the Arbitrator shall set forth the terms of the agreed settlement
in an award.
(q) Any judgment on the award rendered by the Arbitrator may be entered in
any court having jurisdiction thereof, including but not limited to the United
States District Court for the Southern District of New York or the New York
Supreme Court for
New York County. Proceedings to enforce, confirm, modify or vacate an award will
be controlled by and conducted in conformity with the Federal Arbitration Act, 9
U.S.C. section 1 et seq., or applicable state law.
(r) The Arbitrator, upon good cause shown, or at the Arbitrator's
discretion only when necessary to facilitate the arbitration and ensure fairness
and justice, may extend any deadlines stated in this Section.
(s) Any initial costs incurred by the parties to engage the Arbitrator will
be shared by the parties, with Squire to share 50% of the costs, and Railroad
and Cutting Edge to share 50% of the costs.
(t) While it is the intent of the parties that in submitting to arbitration
each party will bear its own expenses, the losing party may be required to pay
the costs of the arbitration if the Arbitrator so determines, otherwise such
expenses will be allocated among the parties as the Arbitrator sees fit.
(u) If the Arbitrator becomes temporarily or permanently unavailable at any
time, the Arbitrator shall have discretion to appoint his or her own successor,
who must be independent and impartial. If the Arbitrator fails or is unable to
appoint a successor within five (5) days of the time the Arbitrator becomes
unavailable or the person appointed is not independent and impartial, or if the
parties fail to designate the Arbitrator by mutual agreement as provided in
subsection (a) above, then JAMS/Endispute, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000
shall appoint the Arbitrator or successor Arbitrator. In the event that
JAMS/Endispute fails or is unable to appoint an independent and impartial
Arbitrator or successor Arbitrator within five (5) days thereafter, then either
party may request that the American Arbitration Association
appoint an Arbitrator to determine the dispute, which Arbitrator shall be bound
by the rules for the arbitration as set forth in this Section. Upon appointment,
the Arbitrator or successor Arbitrator shall affirm his or her independence and
impartiality, and agreement to adhere to the procedures, rules, terms and
condition of this Section in writing to the parties.
5.08 Should any provision of this Agreement be held by a court of
competent jurisdiction to be enforceable only if modified, such holding shall
not affect the validity of the remainder of this Agreement, the balance of which
shall continue to be binding upon the parties hereto with any such modification
to become a part hereof and treated as though originally set forth in this
Agreement. The parties further agree that any such court is expressly
authorized to modify any such unenforceable provision of this Agreement in lieu
of severing such unenforceable provision from this Agreement in its entirety,
whether by rewriting the offending provision, deleting any or all of the
offending provision, adding additional language to this Agreement, or by making
such other modifications as it deems warranted to carry out the intent and
agreement of the parties as embodied herein to the maximum extent permitted by
law. The parties expressly agree that this Agreement as modified by the court
shall be binding upon and enforceable against each of them. In any event,
should one or more of the provisions of this Agreement be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions hereof, and if such
provision or provisions are not modified as provided above, this Agreement shall
be
construed as if such invalid, illegal or unenforceable provisions had never been
set forth herein.
5.09 This Agreement shall be binding upon and inure to the benefit of
Railroad, Cutting Edge and Squire and their successors and permitted assigns
only. Any purported assignment hereunder by any party without the prior written
consent of other parties shall be void and of no force or effect. Without
limiting the generality of the foregoing, no other person, corporation or other
entity (including without limitation, the corporate parent of Squire (that is,
XxXxxxxxxx Apparel Group Inc., a Delaware corporation) and each other subsidiary
or affiliate, direct or indirect or whether now existing or hereafter created or
acquired, of such corporate parent, including without limitation, Miss Xxxxx,
Inc., a Delaware corporation, Xxxx-Xx Knitwear Inc., a Delaware corporation, and
XxXxxxxxxx Apparel Holdings Inc., a South Carolina corporation), shall have any
liability or obligation under, pursuant to, by reason of, or arising out of,
this Agreement or the transactions contemplated hereby.
5.10 The validity of this Agreement and of any of its terms or
provisions, as well as the rights and duties of the parties under this
Agreement, shall be construed pursuant to and in accordance with the laws of the
State of New York, without regard to conflict of laws principles.
5.11 This Agreement may be executed in counterparts, including by
telecopy, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
5.12 The parties hereto agree that this Agreement is the product of
negotiations between sophisticated parties, all of whom were represented by
counsel, and each of whom had an opportunity to participate in, and did
participate in, the drafting of each provision hereof. Accordingly, ambiguities
in this Agreement, if any, shall not be construed strictly or in favor of or
against any party hereto but rather shall be given a fair and reasonable
construction without regard to the rule of contra proferentem.
------------------
5.13 Except as expressly set forth herein, nothing herein expressed
or implied is intended or shall be construed to confer upon any person,
corporation or other entity, other than the parties hereto and their successors
or permitted assigns, any rights or remedies under or by reason of this
Agreement or the transactions contemplated hereby.
5.14 Railroad and Cutting Edge covenant and agree that any and all
publications (whether written or oral) and notices to or other communications
with third parties concerning this Agreement and the transactions contemplated
hereby shall be subject to the prior written approval of Squire.
5.15 Railroad, Cutting Edge and Squire, at the request of the
applicable party, severally, shall use its reasonable efforts to take, or cause
to be taken, all actions and to do, or cause to be done, all things reasonably
necessary to give effect to the transactions contemplated by this Agreement.
5.16 Notwithstanding anything to the contrary contained herein, the
parties hereto understand and agree that the terms and provisions of this
Agreement shall become effective only upon delivery by Squire to Railroad and
Cutting Edge of a written notice (the "Effectiveness Notice", and the date of
the delivery of the Effectiveness Notice, hereinafter, the "Effective Date")
that Squire has received consent to this Agreement and the transactions
contemplated hereby (in form and substance satisfactory to Squire in its sole
discretion) (a "Consent"), and Squire agrees to send such Effectiveness Notice
in the event Squire receives a Consent, under (i) the Amended and Restated
Financing Agreement dated as of June 18, 1998, as amended, by and among Norton
XxXxxxxxxx, Inc., Norton XxXxxxxxxx of Xxxxxx, Inc., Miss Xxxxx, Inc., JJ
Acquisition Corp., the Financial Institutions from time to time party thereto,
NationsBanc Commercial Corporation, as Collateral Agent, The CIT
Group/Commercial Services, Inc., as Administrative Agent, and Fleet Bank NA, as
Documentation Agent, and, if necessary, (ii) the Indenture dated as of June 18,
1998, as amended, providing for Norton's $125,000,000 12 1/2% Senior Notes Due
2005, among Norton XxXxxxxxxx, Inc., the Subsidiary Guarantors named therein,
and United States Trust Company of New York, as Trustee. In the event that the
Effectiveness Notice is not delivered by Squire to Railroad and Cutting Edge on
or before October 31, 1999, this Agreement (and the Exhibits hereto) shall
automatically terminate and shall be of no further force or effect.
* * *
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the date first above written.
NORTON XXXXXXXXXX OF XXXXXX, INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer, Vice
President, Secretary and Treasurer
RAILROAD ENTERPRISES, INC.
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
Title: President
CUTTING EDGE SERVICES, INC.
By: /s/ Xxxxxxxxx Xxxxxxxx
-----------------------------------
Name: Xxxxxxxxx Xxxxxxxx
Title: President
EXHIBIT A
EXHIBIT B
XXXX OF SALE AND ASSIGNMENT
---------------------------
THIS XXXX OF SALE AND ASSIGNMENT (this "Xxxx of Sale and Assignment")
is made, executed and delivered on August 9, 1999, by and among Norton
XxXxxxxxxx of Xxxxxx, Inc., a New York corporation (the "Transferee"), Railroad
Enterprises, Inc., a New Jersey corporation ("Railroad") and Cutting Edge
Services, Inc., a New Jersey corporation ("Cutting Edge"; and together with
Railroad collectively, the "Transferors"). All capitalized terms used herein
and not otherwise defined herein shall have the meanings ascribed to them in the
Agreement (as defined below).
W I T N E S S E T H :
-------------------
WHEREAS, the Transferors and the Transferee have executed and
delivered the Agreement dated as of July 5, 1999 (the "Agreement"), pursuant to
which, among other things, the Transferors have agreed to sell, assign, convey
and deliver to the Transferee the Assets (as hereinafter defined).
NOW, THEREFORE, in consideration of the foregoing premises, the
consideration set forth in the Agreement and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as follows:
1. The Transferors do hereby sell, assign, convey and deliver to the
Transferee, and the Transferee hereby purchases, acquires and accepts from the
Transferors, all of the Transferors' right, title and interest in and to the
following and properties (collectively, the "Assets"), except to the extent that
any of the following are Excluded Property:
(i) All of the fixed assets and other tangible personal property,
including without limitation, machinery, tools, equipment, furniture,
leasehold improvements, materials and supplies (collectively, the
"Property"), other than Property which is Excluded Property (as
defined in Section 1.02 of the Agreement), (a) of Railroad and/or
Cutting Edge presently located at 0 Xxxxxx Xxxxxxxxx, Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx, xx the one hand, and (b) of Railroad and/or
Cutting Edge presently located at 0000 Xxxxxx Xxxx, Xxxx Xxxxxxxxxx,
Xxx Xxxxxx, xx the other hand, including without limitation the
Property set forth in Exhibit A to the Agreement;
(ii) All of Railroad's rights and entitlements under the
Agreement dated January 7, 1993, as amended or modified in any manner,
between Squire and Railroad and under any and all other agreements
(other than the Agreement) between or among Railroad, on the one hand,
and Squire, Squire's corporate parent and/or any present or former
subsidiaries, affiliates or related entities of Squire or of Squire's
corporate parent (collectively, the "Railroad Agreements"), and all of
Cutting Edge's rights and entitlements under the Agreement dated March
17, 1993, as amended or modified in any manner, between Squire and
Cutting Edge (as the successor to Xxxx-Xxxxx Productions, Inc.) and
under any and all other agreements (other than this Agreement and the
Sublease (as hereinafter defined)) between or among Cutting Edge, on
the one hand, and Squire, Squire's corporate parent and/or any present
or former subsidiaries, affiliates or related entities of Squire or
Squire's corporate parent (collectively, the "Cutting Edge
Agreements");
(iii) All rights, remedies and benefits of each of Railroad and
Cutting Edge arising under or relating to any of the Assets, and all
causes of action and claims, known or unknown, arising therefrom,
including without limitation, rights, remedies and benefits arising
out of expressed or implied warranties from manufacturers or suppliers
of the Property; and
(iv) All products and proceeds of any of the foregoing.
TO HAVE AND TO HOLD all and singular of the Assets unto the
Transferee, its successors and assigns, to its and their own use forever.
2. It is understood and agreed that, except for the Assets, neither
of the Transferors is selling, assigning or conveying to the Transferee, and the
Transferee is not purchasing, and the Assets shall not include, any of either of
the Transferors' right, title or interest in or to any other assets or
properties of any kind or nature, whether real, personal or mixed, or whether
tangible or intangible.
3. It is understood and agreed that the Transferee shall not assume
or be deemed to assume and shall have no responsibility, liability or obligation
with respect to any liabilities or obligations (including but not limited to
debts, liabilities and obligations incurred by Railroad as the manager or
operator of the Assets or the provider of the Services (as defined in the
Agreement) of, or claim against, either or both of the Transferors, or of or
against any present, former or future predecessor, successor, director, officer,
employee, agent, stockholder or other affiliate of either or both of the
Transferors, of any kind or nature, whether absolute, accrued, contingent or
otherwise, and whether due or to become due and whether or not asserted and
whether known or unknown, and however arising, all of which liabilities,
obligations and claims the Transferors hereby agree to retain, remain solely
responsible for, perform, pay and discharge promptly as and when due.
4. Each of the Transferors for itself and its successors and assigns,
hereby covenants and agrees that, at any time and from time to time after the
date hereof, each of the Transferors will, upon the reasonable request of the
Transferee and without further consideration, do, execute, acknowledge and
deliver or cause to be done, executed, acknowledged and delivered, any and all
such further acts, deeds, instruments,
documents, transfers and assurance as may be reasonably required for the better
conveyance, transfer and assignment to the Transferee of the Assets conveyed,
transferred, assigned or sold as provided herein or for aiding and assisting in
reducing to the Transferee's possession any and all of the Assets.
5. The validity of this Xxxx of Sale and Assignment and of any of its
terms or provisions, as well as the rights and duties of the parties under this
Xxxx of Sale and Assignment, shall be construed pursuant to and in accordance
with the laws of the State of New York, without regard to conflict of laws
principles.
6. Neither the Transferors nor the Transferee may assign any of their
respective rights, interests or obligations under this Xxxx of Sale and
Assignment except to the extent that such rights, interests or obligations are
assigned pursuant to Section 5.09 of the Agreement. Any attempted assignment in
contravention hereof shall be void.
7. This Xxxx of Sale and Assignment may be executed in multiple
counterparts, each of which will be deemed an original and all of which taken
together will constitute a single instrument.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Xxxx of Sale
and Assignment to be executed on the day and year first above written.
NORTON XXXXXXXXXX OF XXXXXX, INC.
By:
-----------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Chairman
RAILROAD ENTERPRISES, INC.
By:
-----------------------------------
Name:
Title:
CUTTING EDGE SERVICES, INC.
By:
-----------------------------------
Name:
Title:
EXHIBIT C
RELEASE AND COVENANT NOT TO XXX MADE
EFFECTIVE THIS 9th DAY OF AUGUST, 1999
--------------------------------------
Norton XxXxxxxxxx of Xxxxxx, Inc., a New York corporation ("Squire"),
with principal places of business at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, and
its predecessors, successors and assigns (collectively the "Releasors"), in
consideration of the sum of One Hundred Dollars ($100.00) received from each of
Railroad Enterprises, Inc. ("Railroad") and Cutting Edge Services, Inc.
("Cutting Edge"), the receipt, sufficiency and adequacy of which is hereby
acknowledged, as of the effective date first written above, hereby jointly and
severally release and discharge each of Cutting Edge, Railroad, their current
and former subsidiaries, affiliates, divisions and related corporate entities,
and the current and former officers, directors, employees, agents,
representatives, attorneys, shareholders, principals, heirs, executors,
administrators, predecessors, successors and assigns of all of the foregoing
(collectively the "Releasees") from all actions, causes of action, suits, debts,
dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants,
contracts, obligations, controversies, agreements, promises, variances,
trespasses, damages, judgments, extents, executions, claims and demands
whatsoever, in law, admiralty or equity, whether known, unknown, foreseen or
unforeseen, contingent, matured, liquidated or unliquidated, which against the
Releasees, the Releasors ever had, now have or hereafter can, shall or may have
for, upon, or by reason of any matter, cause or thing whatsoever from the
beginning of the world to the effective date of this Release, except insofar as
Squire may have any claims against Railroad and Cutting Edge arising after the
effective date of this Release and under the Agreement dated as of July 5, 1999,
by and among Squire, Railroad and Cutting Edge.
In addition to, and without limiting this Release, Releasors hereby
unconditionally and irrevocably undertake, covenant and agree that Releasors
will never bring any action, proceeding, suit or charge, jointly or severally,
nor will they ever assert, prosecute or file a complaint for any claim or demand
for relief of any kind, in or before any court, tribunal, administrative or
regulatory agency, arbitrator or other forum against the Releasees, regardless
of when such claim or demand for relief allegedly arose, arising out of or in
any way relating to a certain agreement dated January 7, 1993 between Railroad
and Squire and a certain agreement dated March 17, 1993 between Xxxx-Xxxxx
Productions, Inc. (Cutting Edge's predecessor) and Squire as amended or
modified, including, without limitation, all circumstances or transactions
arising out of or relating thereto.
Releasors acknowledge and agree that this Release shall be construed
in the broadest and most inclusive manner permitted by law to bar, now and
forever, the assertion or prosecution, whether jointly or severally, by
Releasors of any action, proceeding, suit, charge, claim or complaint of any
nature, whether now existing or which may arise in the future, against the
Releasees except as noted above.
The word "Releasors" and "Releasees" includes all releasors and all
releasees under this Release.
This Release may not be changed or terminated orally and shall be
governed by the law of the State of New York without regard for conflict of law
principles.
NORTON XXXXXXXXXX OF XXXXXX, INC.
By: _________________________
Name: Xxxxxxx Xxxxxxxxx
Title: Chairman
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the ____ day of _________ 1999, before me personally came Xxxxxxx
Xxxxxxxxx, to me known, who, being duly sworn, did depose and say that he is the
Chairman of Norton XxXxxxxxxx of Xxxxxx, Inc., the corporation described in and
which executed the foregoing Release and Covenant Not to Xxx, and that he signed
the foregoing Instrument by order and with the approval of the Board of
Directors of Norton XxXxxxxxxx of Xxxxxx, Inc.
---------------------
Notary Public
RELEASE AND COVENANT NOT TO XXX MADE
EFFECTIVE THIS DAY OF 1999
----------------------------------------
Railroad Enterprises, Inc. ("Railroad"), Cutting Edge Services, Inc.
("Cutting Edge") and GAGU Inc. ("GAGU"), New Jersey corporations with principal
places of business at 0 Xxxxxx Xxxxxxxxx, Xxxxx Xxxxxxxxxx, Xxx Xxxxxx, and
their predecessors, successors and assigns (collectively the "Releasors"), in
consideration of the sum of One Hundred Dollars ($100.00) received by each of
them from Norton XxXxxxxxxx of Xxxxxx, Inc. ("Squire"), the receipt, sufficiency
and adequacy of which is hereby acknowledged, as of the effective date first
written above, hereby jointly and severally release and discharge each of
Squire, XxXxxxxxxx Apparel Group Inc. (formerly known as Norton XxXxxxxxxx,
Inc.), a Delaware corporation, Miss Xxxxx, Inc., a Delaware corporation, Xxxx-Xx
Knitwear, Inc., a Delaware corporation, their current and former subsidiaries,
affiliates, divisions and related corporate entities, and the current and former
officers, directors, employees, agents, representatives, attorneys,
shareholders, principals, heirs, executors, administrators, predecessors,
successors and assigns of all of the foregoing (collectively the "Releasees")
from all actions, causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, obligations,
controversies, agreements, promises, variances, trespasses, damages, judgments,
extents, executions, claims and demands whatsoever, in law, admiralty or equity,
whether known, unknown, foreseen or unforeseen, contingent, matured, liquidated
or unliquidated, which against the Releasees, the Releasors ever had, now have
or hereafter can, shall or may have for, upon, or by reason of any matter, cause
or thing whatsoever from the beginning of the world to the effective date of
this Release, except insofar as Railroad and Cutting Edge may have any claims
against Squire arising
after the effective date of this Release and under the Agreement dated as of
July 5 1999, by and among Squire, Railroad and Cutting Edge.
In addition to, and without limiting this Release, Releasors hereby
unconditionally and irrevocably undertake, covenant and agree that Releasors
will never bring any action, proceeding, suit or charge, jointly or severally,
nor will they ever assert, prosecute or file a complaint for any claim or demand
for relief of any kind, in or before any court, tribunal, administrative or
regulatory agency, arbitrator or other forum against the Releasees, regardless
of when such claim or demand for relief allegedly arose, arising out of or in
any way relating to a certain agreement dated January 7, 1993 between Railroad
and Squire and a certain agreement dated March 17, 1993 between Xxxx-Xxxxx
Productions, Inc. (Cutting Edge's predecessor) and Squire as amended or
modified, including, without limitation, all circumstances or transactions
arising out of or relating thereto.
Releasors acknowledge and agree that this Release shall be construed
in the broadest and most inclusive manner permitted by law to bar, now and
forever, the assertion or prosecution, whether jointly or severally, by
Releasors of any action, proceeding, suit, charge, claim or complaint of any
nature, whether now existing or which may arise in the future, against the
Releasees except as noted above.
The word "Releasors" and "Releasees" includes all releasors and all
releasees under this Release.
This Release may not be changed or terminated orally and shall be
governed by the law of the State of New York without regard for conflict of law
principles.
RAILROAD ENTERPRISES, INC.
By: _________________________
Name: Xxxxxxx Xxxxx
Title: President
CUTTING EDGE SERVICES, INC.
By: _________________________
Name: Xxxxxxxxx Xxxxxxxx
Title: President
GAGU INC.
By: _________________________
Name:
Title:
EXHIBIT D
