CONSULTING AGREEMENT
BETWEEN
NINE WEST GROUP INC.
AND
XXXXXXX XXXXXX
THIS CONSULTING AGREEMENT (the "Agreement") made as of the 15th day of
December 1998, by and between Nine West Group Inc. (the "Company") and Xxxxxxx
Xxxxxx (the "Consultant").
WHEREAS, the Company and the Consultant have entered into a Retention
Agreement, dated as of even date herewith (the "Retention Agreement"), to
provide the Consultant with certain benefits in the event the Consultant's
employment terminates as a result of, or in connection with, a Change of
Control (as defined in the Retention Agreement);
WHEREAS, the Company desires to continue to benefit from the experience
and ability of the Consultant in the capacity of a consultant to the Company
upon termination of his employment, and further desires to obtain certain
covenants from the Consultant, as set forth in this Agreement;
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, the parties hereby agree as follows:
1. RETENTION AS CONSULTANT. The Company hereby agrees to engage the
Consultant, and the Consultant hereby accepts the engagement with the Company,
upon the terms set forth in this Agreement.
2. TERM. This Agreement shall commence upon the date following the
termination of the Consultant's employment after a Change of Control for any
reason, other than for "Cause" (as defined in the Retention Agreement);
"Disability" (as defined in the Retention Agreement); or death (the "Effective
Date"), and shall expire two (2) years from the Effective Date, unless earlier
terminated by reason of the Consultant's Disability, death, for "Cause" (as
defined in the Retention Agreement) or by the Consultant in accordance with
the immediately following sentence (the "Consulting Period"). The Consultant
may terminate this Agreement, in his sole discretion, at any time upon thirty
(30) days prior written notice to the Company; PROVIDED, HOWEVER, that the
consultant's covenants contained in Section 6 of this Agreement shall continue
to apply until the expiration of a two (2) year period after the Effective
Date.
3. DUTIES. During the Consulting Period, the Consultant shall render
such consulting and advisory services to the Company as the Consultant and the
Company agree upon from time to time, including, but not limited to, providing
advice to the Company on corporate strategy, the design, manufacture,
marketing and distribution of the Company's products and the coordination and
planning between the Company's factories and its divisions (the "Consulting
Services"); PROVIDED, HOWEVER, that the Consultant will not be required to,
but may at his sole discretion and at the Company's request, devote more than
fifteen (15) days per month to the performance of such services during the
Consulting Period. In this regard, the Company shall provide the Consultant
reasonable notice of such consulting obligations and the Consultant shall have
the right to reschedule commitments to the Company to accommodate the
requirements of his other outside interests.
4. PLACE OF PERFORMANCE. The Consultant shall perform his duties
hereunder at such locations as are acceptable to him or by telephone
consultation. To facilitate the Consultant's performance during the
Consulting Period, the Company shall furnish the Consultant, at no more than a
reasonable cost to the Company, an office and secretary reasonably
satisfactory to the Consultant which is located on the premises of the
Company's headquarters. The Consultant shall be allowed full use of
facilities and other clerical assistance at the Company's offices of a
quality, nature and to the extent made available to executive employees of the
Company from time to time.
5. COMPENSATION AND RELATED MATTERS. As compensation for providing
consulting services hereunder and for providing the covenants set forth in
Section 6 hereof, the Company shall make the following payments and provide
the following benefits to the Consultant:
5.1 PAYMENTS. The Company shall pay the Consultant as follows:
(i) during the first year following the Effective Date, $1,250,000; and (ii)
during the second year following the Effective Date, $750,000. Such annual
fees shall be paid in 12 equal installments on the first day of each month.
5.2 REIMBURSEMENT OF EXPENSES. The Company shall reimburse the
Consultant for reasonable business expenses incurred in the performance of the
Consultant's duties hereunder, including, but not limited to, reasonable
travel, entertainment or similar incidental expenses in connection with the
provision of consulting services; PROVIDED, HOWEVER, that such expenses shall
be incurred and accounted for in accordance with the policies and procedures
established by the Company from time to time for its senior executives.
5.3 FRINGE BENEFITS. During the Consulting Period, the Consultant
shall be entitled to participate in all benefit programs that the Company
establishes and makes generally available to its Consultants.
5.4 AUTOMOBILE. During the Consulting Period, the Company shall
provide the Consultant with the same automobile benefits provided to him by
the Company immediately prior to the Effective Date.
6. COVENANTS OF THE CONSULTANT.
6.1 NON-COMPETITION AND NON-SOLICITATION.
The Consultant acknowledges and recognizes (i) the highly
competitive nature of the business of the Company, (ii) the importance to the
Company of the Confidential Business Information and Trade Secrets (as defined
herein) to which the Consultant will have access, (iii) the importance to the
Company of the knowledge and experience possessed by it relating to sources of
supply of footwear and accessories in Brazil, China, Europe, Hong Kong,
Taiwan, Korea, Mexico and the United States, and its relationships with such
sources of supply, developed by it or its predecessors over many years, and
(iv) the position of responsibility which the Consultant will hold with the
Company. Accordingly, the Consultant agrees that during the Consulting
Period, the Consultant will not, directly or indirectly, (x) engage in the
business activities engaged in by the Company on the date hereof and during
the Consulting Period, such business activities being manufacturing, selling,
producing, marketing, distributing, designing, line building and otherwise
dealing in footwear and accessories, of the types in which the Company does
business during the Consulting Period, and produced in Brazil, China, Europe,
Hong Kong, Taiwan, Korea, Mexico or the United States, in any State of the
United States in which the Company is then doing business, the District of
Columbia, and any other country in which the Company is then doing business,
whether such other engagement is as an officer, director, employee,
proprietor, consultant, independent contractor, partner, advisor, agent or
investor (other than as a passive investor in less than 5% of the outstanding
capital stock of a publicly traded corporation); (y) assist other persons or
businesses in engaging in any business activities prohibited under clause (x);
or (z) induce any employees of the Company to engage in any such activities or
to terminate their employment or hire or attempt to hire any employees of the
Company.
6.2 NON-PUBLICATION.
During the Consulting Period, the Consultant shall not publish any
statement or make any statement (under circumstances reasonably likely to
become public) critical of the Company or in any way adversely affecting or
otherwise maligning the reputation of the Company, customers, suppliers,
agents or subcontractors. In particular and without limitation of the
foregoing, the Consultant shall not, in any circumstance likely to become
public, discourage any person, firm, partnership, corporation, trust or any
other entity or third party from selling any business or assets to the
Company, entering into any joint venture or other business relationship with
the Company, or investing in the Company. Any statements made by the
Consultant in connection with legal, administrative or arbitration
proceedings, or that are required to be made by the Consultant pursuant to
applicable law, shall not be prohibited by this Section 6.2.
6.3 CONFIDENTIALITY.
(a) The Consultant acknowledges that the Company is engaged in the
highly competitive business of designing, developing, manufacturing, marketing
and selling footwear and accessories. The Company's involvement in this
business has required and continues to require the expenditure of substantial
amounts of money and the use of skills developed over considerable time. As a
result of these investments of money, skill and time, the Company has
developed and will continue to develop certain valuable trade secrets and
confidential business information that are peculiar to the Company's business
and the disclosure of which would cause the Company great and irreparable
harm. The Consultant acknowledges that, during the course of rendering
services to the Company, he will receive and/or have access to "Trade Secrets"
and/or "Confidential Business Information" (as defined herein), and that, had
the Consultant not had the opportunity provide services to the Company, he
would not have become privy to such information.
(b) The term "Trade Secrets" means any technical or financial
information, design, process, procedure, formula or improvement that is
valuable and not generally known to the Company's competitors. To the fullest
extent consistent with the foregoing, Trade Secrets shall include, without
limitation, all information and documentation, whether or not subject to
copyright, pertaining to product developments, methods of operation, cost and
pricing structures, and other private, confidential business matters.
(c) The term "Confidential Business Information" means any data or
information and documentation, other than Trade Secrets, which is valuable to
the Company and not generally known to the public, including but not limited
to:
i. Financial information, including but not
limited to earnings, assets, debts, prices, cost
information, sales and profit projections or
other financial data;
ii. Marketing information, including
but not limited to details about ongoing or
proposed marketing programs or agreements by or
on behalf of the Company, marketing forecasts,
results of marketing efforts or information about
impending transactions;
iii. Product information, including but not
limited to development plans, designs, and
product costs; and
iv. Product source and customer information,
including but not limited to any data regarding
actual or potential supply sources, agency
agreements or arrangements and actual or
potential customers.
(d) The Consultant agrees that, except as required to fulfill his
obligations during the course the Consulting Period, he will not, during or
after the Consulting Period, directly or indirectly use, disclose or
disseminate to any other person, organization or entity or otherwise employ
any Trade Secrets or Confidential Business Information. Nothing in this
paragraph shall preclude the Consultant from disclosing or using Trade Secrets
or Confidential Business Information if (i) the Trade Secrets or Confidential
Business Information have become generally known, at the time the Trade
Secrets or Confidential Business Information are used or disclosed, to the
public or to competitors of the Company except through or as a result of the
Consultant's act or omission; or (ii) the disclosure of the Trade Secrets or
Confidential Business Information is required to be made by any law,
regulation, governmental body or authority, or court order, provided that the
Consultant will give the Company prompt written notice of such requirement so
that the Company may seek an appropriate protective order or similar remedy.
The Consultant agrees to deliver to the Company all computer files and tapes,
books, records and documents (whether maintained in paper, electronic or any
other medium) relating to or bearing upon any Trade Secrets or Confidential
Business Information, upon the cessation of the Consulting Period, and the
Consultant agrees not to retain any copies or extracts thereof.
Notwithstanding the foregoing, the Executive shall be entitled to retain such
records as may be reasonably necessary for personal tax or legal compliance or
planning.
(e) It is expressly understood and agreed that, although the
Consultant and the Company consider the restrictions contained in this Section
6 to be reasonable, if a final judicial determination is made by a court
having jurisdiction that the time or territory or any other restriction
contained this Section 6 is an unreasonable or an otherwise unenforceable
restriction, it is the intention of the parties that the provisions of this
Section 6 shall not be rendered void, but such court shall reduce the
duration, area or activity covered by such provision and, in its reduced form,
such provision shall then be enforceable and shall be enforced.
6.4 INJUNCTIVE RELIEF.
The covenants set forth in this Section 6 shall be enforceable by a
court of equity through the granting of a temporary restraining order,
preliminary injunction and/or permanent injunction. In the event of a breach
of Section 6 of this Agreement, the Consultant consents to the entry of an
injunction, and the Consultant shall pay any reasonable fees and expenses
incurred by the Company in enforcing such Sections. Such equitable
enforcement shall be in addition to and shall not prejudice the right of the
Company to an appropriate monetary award.
7. TERMINATION. Termination of this Agreement shall occur as provided
by Section 2 hereof. Any intended termination of this Agreement by the
Company shall be communicated by a Notice of Termination from the Company to
the Consultant, and any intended termination of this Agreement by the
Consultant shall be communicated by a Notice of Termination from the
Consultant to the Company. Any termination for "Cause" shall be subject to
the terms contained in Section 16.4 of the Retention Agreement.
8. EFFECT OF TERMINATION. In the event the Consulting Services are
terminated for any reason whatsoever, the Company shall pay to the Consultant
the compensation and related fees and expenses otherwise payable to him under
this Agreement pro rata through the last day of his actual rendering of
Consulting Services to the Company.
9. MISCELLANEOUS.
9.1 MODIFICATION; WAIVER; NO REPRESENTATIONS. No provision of this
Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by the Consultant
and the Company. No waiver by any party hereto at any time of any breach by
any other party hereto of, or compliance with, any condition or provision of
this Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreement or representations, oral or otherwise, express
or implied, with respect to the subject matter hereof have been made by any
party which are not expressly set forth in this Agreement.
9.2 SUCCESSORS; BINDING AGREEMENT. This Agreement shall be binding
upon and shall inure to the benefit of the Company and its Successors and
Assigns (as defined in the Retention Agreement). The Company shall require
its Successors and Assigns, by agreement in form and substance reasonably
satisfactory to the Consultant, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had taken place.
9.3 ASSIGNMENT. Neither this Agreement nor any right or interest
hereunder shall be assignable or transferable by the Consultant, his
beneficiaries or legal representatives, except by will or by the laws of
descent and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Consultant's legal personal representative.
9.4 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York
without giving effect to the conflict of laws principles thereof. Any action
brought by any party to this Agreement shall be brought and maintained in a
court of competent jurisdiction in New York County in the State of New York.
9.5. SEVERABILITY. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
9.6 ENTIRE AGREEMENT. This Agreement, the Retention Agreement, and
the Employment Agreement (as defined in the Retention Agreement) as amended,
supplemented, or modified, from time to time, constitute the entire agreement
between the parties hereto, and supersede all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto,
with respect to the subject matter hereof.
9.7 NOTICE. For the purposes of this Agreement, notices and all
other communications provided for in the Agreement (including any notice of
termination) shall be in writing, shall be signed by the Consultant if to the
Company or by a duly authorized officer of the Company if to the Consultant,
and shall be deemed to have been duly given when personally delivered or sent
by certified mail, return receipt requested, postage prepaid, addressed to the
respective addresses last given by each party to the other, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company. All notices and communications shall be
deemed to have been received on the date of delivery thereof or on the third
business day after the mailing thereof (whichever is earlier), except that
notice of change of address shall be effective only upon receipt.
9.8 HEADINGS. The headings of the sections of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction hereof.
9.9 FULL SETTLEMENT. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right
which the Company may have against the Consultant or others.
9.10 INDEPENDENT CONTRACTOR STATUS. The parties hereto acknowledge
that the Consultant is at all times acting and performing as an independent
contractor and shall not be considered as an employee of the Company for any
purpose whatsoever. Except for the benefits provided under this Agreement,
the Consultant shall not be entitled to any benefits afforded by the Company
to its employees. Except as expressly authorized by the Company in writing,
the Consultant shall not have any authority, and shall not represent to any
third party that the Consultant has the authority, to bind or commit the
Company with respect to any matter.
9.11 SPECIFIC PERFORMANCE. The parties agree that irreparable damage
would occur in the event that any of the provisions contained in Section 6 of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of Section 6 of
this Agreement and to enforce specifically the terms and provisions hereof in
any court of the United States or any state having jurisdiction, this being in
addition to any other remedy to which they are entitled at law or in equity.
9.12. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall for all purposes be deemed an original, and all of which
shall constitute the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer and the Consultant has executed this Agreement
as of the day and year first above written.
NINE WEST GROUP INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Executive Vice President
/s/ Xxxxxxx Xxxxxx
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XXXXXXX XXXXXX
