AGREEMENT

EXHIBIT 10.1

AGREEMENT

     1. This Agreement (this “Agreement”) is hereby entered into as of December 31, 2009 between Xxxx Enterprises Inc. (“Xxxx”), Xxxx Xxxx and Xxxxxxxx Convertibles, Inc. (“Xxxxxxxx”). Xxxx has ceased operations of the 20 Xxxxxxxx stores controlled and operated by it or its subsidiaries, including a licensed store operated by Xxxx, the owner of which has consented to have its store treated as if such store was owned by Xxxx for the purposes of this Agreement (the “Stores”) and Xxxxxxxx wishes to provide an orderly wind down of such operations to protect the brand and its customers.

2. The parties hereby agree that as of the January 1, 2010, Xxxxxxxx will, subject to Section 7, operate any or all of the Stores for the benefit of Xxxxxxxx and Xxxxxxxx will collect all customer payments from sales made at the Stores and after such date. Xxxxxxxx will offer to employ all Store location based employees currently employed by Xxxx, provided they sign an appropriate agreement to the effect that Xxxxxxxx is not responsible for any commissions, salary, health or other benefits or other compensation owed them prior to such date, and the parties hereby agree that Xxxxxxxx will not be, and is not, responsible for any such commissions, salary or compensation. Xxxxxxxx will be responsible for the costs of operating the Stores on and after January 1, 2010, except as provided in Section 7 with respect to Stores vacated by Xxxxxxxx.

     3. Subject to receipt of a xxxx of sale or other appropriate evidence of conveyance of title, Xxxxxxxx will pay to Xxxx $635,000 for the current inventory in each of the Stores. Xxxxxxxx shall make such payments in accordance with the schedule set forth on Annex A attached hereto. Xxxx shall also be entitled to receive, the remaining balance collected from customers on Old Sales, as defined below, which were delivered on December 23, 2009, December 24, 2009 and December 26, 2009. Except as set forth in the prior sentence, Xxxx is not entitled to any payments by customers with respect to amounts received by Xxxxxxxx for Old Sales or any other sales written at the Stores.

     4. Xxxxxxxx hereby agrees to ship to customers, subject to customers’ refusal or inability to accept delivery, the merchandise for sales written at the Stores (“Old Sales”) on or prior to November 27, 2009 but not yet delivered. Xxxx shall not be required to make any further payment as to the merchandise to be delivered to fulfill Old Sales. Xxxx agrees to be responsible for and pay all sales taxes and commissions on Old Sales and Xxxxxxxx shall not be responsible for such taxes or commissions. In the event that an Old Sale is re-written with a date after November 27, 2009, Xxxx agrees to be responsible for payment of sales taxes, or reimburse Xxxxxxxx if Xxxxxxxx pays such taxes, and commissions on the rewritten Old Sale. Xxxxxxxx shall be entitled to any additional deposits or other payments received by Xxxx after December 21, 2009, for Old Sales. Xxxx shall not make any floor sales from inventory after December 26, 2009, with the exception of the Store located in Bedford-Stuyvesant, Brooklyn, New York (the “BED Store”) that is being liquidated. Xxxx shall be responsible for all sales taxes and commissions on floor sales from inventory made prior to January 1, 2010 at any of the Stores. With respect to the BED Store, Xxxx is responsible for the sales tax, commissions, any other payments, including, delivery charges. Xxxxxxxx will not be responsible for delivery of any merchandise in the BED Store and Xxxx agrees to use its own services for delivery.

     5. Xxxxxxxx acknowledges and agrees that amounts owed under the Interim Agreement estimated at $301,000, and due to Xxxxxxxx pursuant to Interim Agreement (the “Balance”), are hereby deemed paid in full, except as otherwise provided herein, subject to the transfer by Xxxx to Xxxxxxxx of 93,579 shares of Xxxxxxxx common stock, par value $0.01 per share, owned by Xxxx.

     6. Except as provided in Section 3, Xxxx agrees to pay Xxxxxxxx all amounts collected by it which exceed 35% of the collected sales price (excluding delivery costs and applicable sales taxes) for all sales subsequent to December 21, 2009 and prior to January 1, 2010, whether as part of an initial deposit or Additional Payments as defined below. Any amounts in excess of the 35% which Xxxx does not pay to Xxxxxxxx shall be offset against amounts due to Xxxx pursuant to Section 3. For purposes of this Agreement, “Additional Payments” shall means any payments received by Xxxx with respect to sales after an initial deposit.

     7. Beginning on January 1, 2010, Xxxxxxxx agrees to negotiate as to the existing leases for the Stores with each landlord and will endeavor to cancel or defer the rent arrearages, which to Xxxx’x knowledge aggregate approximately $300,000 as of the date of this Agreement. Xxxxxxxx will pay no more than $300,000 to settle the arrearages at all 20 Stores and if the arrearages exceed $300,000 Xxxx will reimburse Xxxxxxxx for such excess or such excess will be used to offset the amount Xxxxxxxx owes Xxxx pursuant to Section 3. Xxxx agrees to cooperate with Xxxxxxxx with respect to Jennifer’s attempts to negotiate such settlements and new leases if Xxxxxxxx wants to take over the store location. While it is the intent of Xxxxxxxx to take over all 20 Stores, the parties hereby acknowledge that Xxxxxxxx xxx not be able to successfully negotiate for a new lease or other arrangement on terms satisfactory to Xxxxxxxx, in its sole discretion, in which case Xxxxxxxx will vacate the leased property and Xxxx shall arrange for closure of the Store and Xxxxxxxx shall not be responsible for any amounts still owed to the landlord with respect to such Store location, except for the removal of the showroom inventory which Xxxxxxxx shall arrange. Nothing herein shall require Xxxxxxxx to enter into a new lease or to spend all or any part of the $300,000 except that Xxxxxxxx shall be obligated to cure arrearages (not to exceed $300,000 in the aggregate) with respect to the leases for Stores at locations where Xxxxxxxx elects to enter into, and does enter into, a new lease on Jennifer’s behalf. The parties hereby acknowledge and agree that Xxxxxxxx will not take over the Ricky’s store lease. To the extent that Xxxxxxxx enters into a new lease with the existing landlord, any security deposit will remain with the landlord with respect to the new lease executed by Xxxxxxxx and be applied for Jennifer’s benefit.

     8. Except as specifically set forth herein, the parties agree that Xxxxxxxx will not be responsible for any liabilities of Xxxx.

     9. Xxxx Xxxx agrees to indemnify, defend and hold harmless Xxxxxxxx, from and against any and all losses, liabilities, claims, actions, damages and expenses (including without limitation reasonable attorney’s fees and disbursements) arising out of Xxxx’x obligations for sales taxes, commissions, payroll and normal store operating expenses through December 31, 2009, but excluding rent and related landlord charges.

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     10. Xxxx agrees to provide such information as may be necessary under this Agreement with respect to former Xxxx employees, shipping, leases and other matters surrounding Old Sales.

     11. Each party hereto shall execute and/or cause to be delivered to each other party hereto such instruments and other documents, and shall take such other actions as the other parties, or any of them, may reasonably request in order to consummate and make effective the transactions contemplated in this Agreement. The parties will cause any of their affiliates to execute and/or cause to be delivered to each other party hereto such instruments and other documents, and take such other actions as the other parties, or any of them, may reasonably request in order to consummate and make effective the transactions contemplated in this Agreement.

     12. The parties hereby acknowledge and agree that all previous agreements or arrangements between the parties, including, but not limited to, the Purchasing Agreement, the Warehousing Agreement, Warehousing Transition Agreement, Management Agreement and License, Hardware Lease, Software License Agreement, Option Agreement, the Royalty Agreement, the Trademark Usage Agreement, the Interim Agreement among Xxxxxxxx and Xxxx and certain of their affiliates and the other related agreements (as each may have been amended from time to time) are terminated and shall be of no further force or effect, including, without limitation, any provisions that purport to extend beyond the termination of the agreements (including any which purport to extend obligations or liabilities beyond such termination), except that Xxxxxxxx shall retain all rights, title and interest in, to and under any trademarks, leases and other assets previously conveyed to Xxxxxxxx or its affiliates under such agreements. This Agreement constitutes the entire understanding of the parties with respect to the subject matter hereof and supersedes all prior and current understandings and agreements, whether written or oral, with respect to the parties. The parties will cause any of their affiliates as were parties to such agreements to execute any additional evidence of termination as may be reasonably requested.

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EXHIBIT 10.1

     IN WITNESS WHEREOF, the parties have signed this Agreement as of this 31st day of December 2009.

	Xxxx Enterprises, Inc.
	By:	/s/Xxxx Xxxx
		Xxxx Xxxx, President
	/s/Xxxx Xxxx
	Xxxx Xxxx
	Xxxxxxxx Convertibles, Inc.
	By:	/s/ Xxxxxx Xxxxxxxxxx
		Xxxxxx Xxxxxxxxxx, Chief Executive Officer

EXHIBIT 10.1

ANNEX A

Xxxxxxxx shall pay Xxxx $635,000 in accordance with the schedule below:

     a. $100,000 by January 1, 2010; 
     b. $100,000 by January 15, 2010;
     c. $150,000 by February 10, 2010;
     d. $100,000 by March 10, 2010;
     e. $75,000 by April 10, 2010; and
     f. $110,000 by May 10, 2010.