EXHIBIT 10.69
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SERVICES AGREEMENT
between
THE TJX COMPANIES, INC.
and
BRYLANE, L.P.
Dated as of December 9, 1996
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SERVICES AGREEMENT
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THIS SERVICES AGREEMENT (the "Agreement"), made as of this ____ day of
December 1996, is entered into by Brylane, L.P., a Delaware limited partnership
having an address at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Brylane"),
and The TJX Companies, Inc., a Delaware corporation with its principal office at
000 Xxxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx 00000 ("TJX").
WITNESSETH:
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WHEREAS, TJX, its subsidiary Xxxxxxxx'x, Inc. ("COB") and certain related
entities and Brylane have entered into an Asset Purchase Agreement dated October
18, 1996 (the "Purchase Agreement") pursuant to which Brylane has agreed to
purchase the assets of COB; and
WHEREAS, TJX is willing to continue to provide to Brylane certain services
relating to the COB business that it is presently providing to COB upon the
terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereby agree as follows:
1. SERVICES.
1.1 Services to be Made Available. In accordance with the terms and
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provisions of this Agreement, TJX agrees to perform (or cause its subsidiaries
to perform) for Brylane and its subsidiaries services relating to the COB
business described in the Annexes hereto (collectively, the "Services") in the
amounts and to the extent specified with respect to each such Service in the
applicable Annex hereto and Brylane agrees to perform any of its obligations
hereunder and as set forth in the following Annexes:
Services Applicable Annex
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Data Processing A
Treasury Services B
Corporate Payroll Services C
Legal Services D
1.2 Fees. Brylane agrees to pay to TJX a fee for each of the Services as
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specified in the applicable Annex hereto.
Not more often than once per fiscal month, TJX shall forward to Brylane
invoices for the Services listing the Services provided hereunder and listing
the fees for such Services, together with such additional documentation
evidencing the provision thereof as Brylane shall reasonably request. Invoices
for Services provided for partial fiscal months and relating to Services for
which the fees are to be calculated on a monthly basis shall be based upon the
number of days in such fiscal month. Within 30 days of receiving an invoice and
such additional documentation (if any) reasonably requested by Brylane, Brylane
shall pay to TJX the amount invoiced. Brylane agrees to pay to TJX interest on
any such invoice amount that is not paid within 30 days after receipt by Brylane
at a rate per annum equal to the rate announced by The First National Bank of
Boston as its Base Rate, calculated daily, for each day that such invoice amount
remains overdue.
1.3 Term of Agreement. This Agreement shall become effective as of the
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date first set forth above and shall terminate with respect to each Service on
the date specified for such Service or as determined in accordance with the
applicable Annex hereto.
1.4 Timely Performance and Cooperation. TJX shall use commercially
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reasonable efforts to perform the Services in a timely manner that will be at
least consistent with its past practices and Brylane shall use commercially
reasonable efforts to cooperate with TJX in connection with the provision of the
Services.
2. REPRESENTATIONS AND WARRANTIES.
As an inducement to enter into this Agreement, each party represents to and
agrees with the other that:
(a) it is a corporation or partnership duly organized, validly
existing and in good standing under the law of the State of Delaware and
has all requisite corporate or partnership power, as the case may be, to
carry out the transactions contemplated by this Agreement;
(b) it has duly and validly taken all corporate or partnership action,
as the case may be, necessary to authorize the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby; and
(c) this Agreement has been duly executed and delivered by it and
constitutes its legal, valid and binding obligation enforceable against it
in accordance with its terms.
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3. OTHER TERMS AND PROVISIONS.
3.1 Independent Contractor Status. TJX shall perform all services under
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this Agreement as an "independent contractor" and not as an agent of Brylane.
TJX is not authorized to, and shall not, assume or create any obligation or
responsibility, express or implied, on behalf of, or in the name of, Brylane or
bind Brylane in any manner. TJX shall be solely responsible for the payment of
all salaries and benefits and all employment taxes with respect to its employees
and the employees of its subsidiaries providing the Services.
3.2 Indemnification. Brylane hereby agrees to indemnify and hold harmless
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TJX, its subsidiaries, each of their respective directors, officers, employees,
agents and affiliates (a "TJX Indemnitee") from and against all costs and
damages incurred by such TJX Indemnitee to third parties as a result of the
provision by TJX pursuant to this Agreement of the Services, other than (i)
costs or damages incurred by such TJX Indemnitee as a result of its willful
misconduct or gross negligence and (ii) certain license fees for software, if
any, as further specified in paragraph 3 of Annex A attached hereto. TJX hereby
agrees to indemnify and hold harmless Brylane, its subsidiaries, each of their
respective directors, officers, employees, agents and affiliates (a "Brylane
Indemnitee") from and against all costs and damages incurred by such Brylane
Indemnitee to third parties as a result of: (i) the willful misconduct or gross
negligence of TJX in the provision by it of the Services pursuant to this
Agreement, or (ii) any claim that the use in the provision of Services of any
software developed or owned by TJX or any of its affiliates infringes upon the
patent, copyright or other intellectual property interests of any third party.
Procedures relating to indemnification claims and obligations shall follow and
be handled in accordance with Sections 9.4 and 9.5 of the Purchase Agreement.
In addition, in no event shall an indemnifying party be liable for any claim by
a third party that is settled or compromised by an indemnified party without the
written consent of the indemnifying party. This section shall survive the
termination of this Agreement.
3.3 Limitation of Liability and Reimbursement. Other than as specified in
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paragraph 3 of Annex A attached hereto, neither TJX nor any of its subsidiaries
or any of their respective directors, officers, employees, agents or affiliates
shall in any event be liable for any damages or expenses of any kind or nature
whatsoever that may arise out of TJX's (or any such subsidiary's or any such
directors', officers', employees', agents' or affiliates') performance or
failure to perform any of its obligations under this Agreement, other than those
damages caused by TJX's (or any such subsidiary's or such persons') willful
misconduct or gross negligence. In addition, notwithstanding anything in this
Agreement to the contrary, in no event will the parties hereto or any of their
respective subsidiaries or any of their respective directors, officers,
employees, agents or affiliates be liable to any person, for lost profits, lost
savings, or other indirect, special, incidental or consequential damages whether
such damages are based on tort, contract, or any other legal theory, and even if
such party or any of its subsidiaries or any of their respective directors,
officers, employees, agents or affiliates has been advised of the possibility of
such damages. This section shall survive the termination of this Agreement.
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3.4 Severability. If any term, provision, covenant or restriction of this
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Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
3.5 Assignment. Except by operation of law or in connection with the sale
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of all or substantially all the assets of a party hereto, this Agreement shall
not be assignable, in whole or in part, directly or indirectly, by either party
hereto without the prior written consent of the other, and any attempt to assign
any rights or obligations arising under this Agreement without such consent
shall be void. Subject to the foregoing, this Agreement shall be binding in all
events upon any successor to all or substantially all the assets of a party
hereto.
3.6 Further Assurances. Subject to the provisions hereof, each of TJX and
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Brylane shall make, execute, acknowledge and deliver such other agreements,
documents or instruments and take or cause to be taken such other actions as may
be reasonably required in order to effectuate the purposes of this Agreement and
to consummate the transactions contemplated hereby. Subject to the provisions
hereof, each of TJX and Brylane shall, in connection with entering into this
Agreement, performing its obligations hereunder and taking any and all actions
relating hereto, comply with all applicable laws, regulations, orders and
decrees, obtain all required consents and approvals and make all required
filings with any governmental agency, or other regulatory or administrative
agency, commission or similar authority and promptly provide the other with all
such information as the other may reasonably request in order to be able to
comply with the provisions of this sentence.
3.7 Parties in Interest. Nothing in this Agreement expressed or implied
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is intended or shall be construed to confer any right or benefit upon any person
or entity other than TJX and Brylane and their respective successors and
permitted assigns.
3.8 Waivers, Etc.; Amendments. No failure or delay on the part of TJX or
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Brylane in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No amendment, modification or waiver of any provision of this
Agreement nor consent to any departure by TJX or Brylane therefrom shall in any
event be effective unless the same shall be in writing, and then such waiver or
consent shall be effective only in the specific instance and for the purpose for
which given.
3.9 Confidentiality. Subject to any contrary requirement of law and the
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right of each party to enforce its rights hereunder in any legal action, each
party shall keep strictly confidential and shall cause its employees and agents
to keep strictly confidential any information that it or any of its agents or
employees may acquire pursuant to, or in the course of performing its
obligations under, any provision of this Agreement; provided, however, that
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such obligation to maintain confidentiality shall not apply to information that
has been made or becomes public other than as a result of acts by the receiving
party.
3.10 Force Majeure. TJX shall not be liable for failure to perform or any
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delay in performing any of its obligations under this Agreement if such failure
or delay is due to fire, flood or other natural disasters or acts of God, war,
embargo, riot, strike or the intervention of any government authority or other
causes beyond its reasonable control ("Force Majeure"). TJX agrees to notify
Brylane promptly of any Force Majeure and to use commercially reasonable efforts
to resume performance as soon as is reasonably practicable.
3.11 Entire Agreement. This Agreement contains the entire understanding of
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the parties with respect to the provisions of Services from TJX to Brylane.
3.12 Headings. Descriptive headings are for convenience only and shall not
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control or affect the meaning or construction of any provision of this
Agreement.
3.13 Specific Performance. TJX acknowledges that its failure to perform
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Services under this Services Agreement may result in irreparable harm to
Brylane. Brylane's right to commence any action at law or in equity under this
Services Agreement or in connection with any other claim arising out of or
relating to the services includes, but is not limited to, the right to assert a
claim for specific performance of TJX's obligations hereunder; provided,
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however, that such right shall be available only in response to a failure by TJX
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to perform Services. Brylane shall not be required to prove actual damages in
any such action for specific performance.
3.14 Counterparts. This Agreement may be executed by the parties hereto on
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separate counterparts and in any number of counterparts, and each such executed
counterpart shall be, and shall be deemed to be, an original instrument.
3.15 Notices. Any notice or other communication in connection with this
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Agreement shall be deemed to be delivered if in writing (or in the form of a
telecopy) addressed or transmitted as provided below and if either (i) actually
delivered at said address, (ii) in the case of a letter, three business days
shall have elapsed after the same shall have been deposited in the United States
mails, postage prepaid and registered or certified, or (iii) if in the form of a
telecopy, when the receiving party gives telephonic notice of complete and
legible receipt, to:
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If to Brylane: Brylane, L.P.
000 0xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
With a copy to: Xxxx X. Xxxx
Xxxxxxx Xxxxxx & Co. Incorporated
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
If to TJX, to: The TJX Companies, Inc.
000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxxx 00000
Telecopier: (000) 000-0000
with copies to each: President and General Counsel
With a copy to: Xxxxxx X. Xxxxx, Esq.
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telecopier: (000) 000-0000
or to such other address as either party herein may designate for itself by
notice given as herein provided.
3.16. Governing Law. This Agreement shall be governed by and
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construed in accordance with the domestic substantive law of The Commonwealth of
Massachusetts without giving effect to any choice or conflict of law provision
or rule that would cause the application of the domestic substantive law of any
other jurisdiction.
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IN WITNESS WHEREOF, The TJX Companies, Inc. and Brylane, L.P. have each
caused this Agreement to be executed by its duly authorized officer as of the
date first set forth above.
THE TJX COMPANIES, INC.
By: /s/ XXXXXX X. XXXXXXXX
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Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President
BRYLANE, L.P.
By: /s/ XXXXX X. XXXXXXX
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Name: Xxxxx X. Xxxxxxx
Title: Chief Executive Officer and
Chairman of the Board
Annex A
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Data Processing Services
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Data Processing Annex to Services Agreement
The purpose of this Data Processing Annex (the "Annex") to the Services
Agreement is to define more precisely the data processing services that will be
provided by TJX to Brylane. In the event of any inconsistency between this Annex
and the Services Agreement, this Annex shall control. Fiscal Years referred to
herein are identified by reference to the year in which the TJX fiscal year
ends. Thus, Fiscal 1997 refers to the fiscal year ended January 25, 1997.
1. Service Requirements. During the Term (as such term is defined
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below), TJX shall provide Brylane with the computing services for the COB
business as described in Attachment I attached hereto (collectively, the
"Computing Services") in accordance with the terms hereof. The term of the
Services Agreement with respect to Computing Services (the "Term") shall
terminate on January 31, 1998.
For the period commencing on the date of the Services Agreement and ending
on January 31, 1998, Brylane's requirements for computer usage (such
requirements being hereinafter referred to collectively as the "planned
requirements") during such period and TJX's charges for such periods shall be as
set forth in Attachments II and I, respectively.
Brylane may extend the period of Computing Services for the six month
period ending July 25, 1998 in accordance with the February to July usage plan
for Fiscal 1999 as set forth in Attachment II by providing TJX written notice of
its desire to extend by July 31, 1997.
2. Calculation of Charges. The charges for the Computing Services shall
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be calculated based on per hourly and per item arrangements set forth in
Attachment I.
TJX shall send monthly invoices to Brylane during the term of this
agreement based on Brylane's usage of services.
If Brylane's requirements exceed one hundred twenty percent (120%) of its
planned requirements for each six (6) month period, then TJX will be entitled to
adjust its charges to the extent reasonably necessary to recover its additional
costs, if any, resulting from Brylane's additional requirements. TJX shall use
its commercially reasonable efforts to satisfy any computer usage request in
excess of one hundred twenty percent (120%) of Brylane's planned requirements.
A-1
In the event that Brylane's actual requirements for any six (6) month
period with respect to item 1 and the payroll component of item 2 of Attachment
I are less than eighty percent (80%) of its planned requirements for such
period, Brylane shall pay to TJX an amount equal to the charge for eighty
percent (80%) of the planned requirements.
Brylane agrees to provide to TJX by the fifteenth day of each month, a
written forecast of the anticipated computer, disk and print resource usage of
the COB business for each month remaining in the Term. The planned requirements
shown in Attachment II will not be affected by this written forecast.
3. Third Party License Fees. TJX shall promptly notify Brylane upon its
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receipt of any notice that a third party intends to increase its software
license fees because of the Computing Services being provided by TJX to Brylane
hereunder. In such event, TJX shall, with Brylane's participation and
cooperation, negotiate the amount of such increase and shall seek to ensure that
all additional license rights (other than those already held by TJX, which shall
not be affected) are in the name of, or freely assignable (without payment of
additional consideration) to, Brylane. If TJX incurs additional license fees,
then such fees shall be borne as follows: Byrlane shall reimburse TJX for the
first $500,000 of such fees; TJX and Brylane shall each pay 50% of the next
$500,00 of such fees; and TJX shall pay the balance of any such additional fees.
4. Performance Targets. It is expected that the performance targets for
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the Computing Services provided to Brylane shall be no less than those specified
on Attachment III, assuming Brylane's conformity with TJX's operating standards.
Notwithstanding the foregoing, TJX shall not be required to maintain the
performance targets for Computing Services to the extent that it is unable to
maintain them for other users of computing services (including TJX) for reasons
beyond its commercially reasonable control. In the event that TJX is unable to
meet the performance targets for Computing Services for reasons beyond its
commercially reasonable control, TJX shall provide Brylane the same levels and
quality of Computing Services that it provides to other users of computing
services (including TJX) and shall use its commercially reasonable efforts to
alleviate any condition causing a diminution in such performance targets.
A-2
5. Invoices. TJX shall render to Brylane each month, within 30 days
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after the end of the month, an invoice for the charges for Computing Services
incurred during the previous month. Such invoice shall be payable in accordance
with the terms of the Services Agreement.
6. Delivery of Software. Upon Brylane's request, TJX shall deliver to
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Brylane within a reasonable period after such request the following items with
respect to all applications (i.e. utility routines, utility programs and/or
systems software) developed by TJX and used solely in connection with COB's
business and in which no third party has any rights (the "TJX Software"):
(a) One copy of object code on magnetic media.
(b) One copy of source code on magnetic media.
(c) One copy of any documentation, including source documentation,
maintenance documentation and other documentation, for such software
to the extent then available.
Brylane shall pay TJX for its additional costs relating to such delivery of
software.
TJX hereby grants to Brylane the royalty free, non-exclusive, non-
assignable and non-sublicensable right, license and privilege to use the TJX
Software. Brylane agrees that all TJX Software and all copies thereof are
proprietary to TJX and title thereto remain in TJX. All applicable rights to
patents, copyrights, trademarks and trade secrets in the TJX Software are and
shall remain in TJX. Brylane shall not sell, transfer, publish, disclose,
display or otherwise make available the TJX Software or copies thereof to
others. THE TJX SOFTWARE IS BEING PROVIDED TO BRYLANE AS IS AND ALL WARRANTIES
ARE EXCLUDED, INCLUDING THE WARRANTY OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE. This paragraph shall survive the termination of the
Computer Services and that of the Services Agreement.
7. Coordinating Committee. For the purpose of providing and continuing
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the harmonious relationship between TJX and Brylane, each shall appoint two
individuals to coordinate and review the relationship between the two companies
and their performance under this Annex, as well as strategic planning and
technology changes. These individuals
A-3
shall meet periodically, no less frequently than quarterly, to discuss
operations under this Annex and any problems arising hereunder.
A-4
Attachment I
to Annex A
to Services Agreement
Certain initial charges are indicated and certain related arrangements
explained.
Initial Estimated Estimated
1. Computer FY '97 FY '98 FY '99
(a) CPU/Model 952 (per hour) $1,431.00 $1,431.00 $1,431.00
CPU/Model 600J (per hour) 517.00 $ 517.00 517.00
(b) PRINT, 1-up (per 1K lines) .43 .43 .43
PRINT, 2-up (per 1K lines) .26 .26 .26
PRINT, REMOTE (per 1K lines) .022 .022 .022
PRINT, SARVIEW (per 1K lines) .022 .022 .022
(c) XXXXXXXXXX (xxx xxxxx) .00 .00 .00
(x) DATA ENTRY (per record) .041 .041 .041
DATA ENTRY (per floppy file) 11.30 11.30 11.30
(e) DEDICATED DISK (per GB/mo.) 260.00 260.00 260.00
(f) NETWORK CONNECT Fee 43.00 43.00 43.00
(per unit/mo.)
(g) PAYROLL (per check) .36 .37 .39
(h) D/C Rate (per hour) 35.00 35.00 35.00
(i) Software Rate (per hour) 50.00 50.00 50.00
2. Payroll, General Ledger, Fixed Asset, E/P System, and other Corporate
Systems Support.
(a) Payroll Support - rate shown for item 1(g) above includes 50 staff
days of Direct Support. Service requests exceeding this annual level,
if agreed to by TJX, will be billed at the Software Rate per hour.
(b) Other systems - usage as incurred in item 1(a) above, plus an
application support fee of $4,500 per month for General Ledger, Fixed
Asset, E/P, and related software plus any license fees (at cost) if
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additional charges are incurred.
Notwithstanding Section 1 of the Annex, production of W-2 Forms shall, at
Brylane's option, extend through the calendar year ending on December 31 in
the year in which the termination of the other Computing Services occurs.
3. Maintenance and operation of the TJX Data Communication network
(a) Communication lines & hardware - provided at TJX's cost
(b) Routine support - 50 staff days are included in item 1(f) above;
support exceeding this annual level, if agreed to by TJX, will be
billed at the D/C Rate per hour.
(c) Unplanned projects, if agreed to by TJX, will be billed at the D/C
Rate per hour plus materials at cost
4. Technical System Support
(a) Unplanned software - acquired, installed, and billed at cost
(b) Routine support - up to 200 staff days are included in Item 1(a)
above. Support exceeding this annual level must be agreed to by TJX
will be billed at the Software Rate per hour.
(c) Unplanned projects - billed at $50/hour plus materials at cost
5. New Technology Support
Support for Xxxxxx Technologies Project including the Pilot shall not
exceed 10 staff days and neither TJX nor any of its subsidiaries or any of
their respective directors, officers, employees, agents or affiliates shall
in any event be liable for any damage or expenses of any kind whatsoever
that may arise out of the Xxxxxx Technology Project or any new technology
project for which support is provided. This paragraph shall survive the
termination of the Computer Services and that of the Services Agreement.
6. Technical Training Classes
Computer-related training classes which are offered to TJX associates will
be made available to Brylane's associates on a space available basis. The
classes will be billed to Brylane at TJX cost.
Attachment II
to Annex A
to Service Agreement
FISCAL 1997 COMPUTER UTILIZATION PLAN
PLANNED USAGE FOR XXXXXXXX'X OF BOSTON
FEB MAR APR MAY JUN JUL
(4) (5) (4) (4) (5) (4)
PRODUCTION
BATCH CPU (hours)
Telemarketing 34.9 81.0 72.0 69.7 48.5 57.0
Finance 17.4 31.6 35.2 33.0 32.4 19.0
Merchandising 17.4 25.8 19.9 20.0 20.8 17.0
Marketing 34.0 66.7 32.8 69.3 50.2 38.0
Fulfillment 43.0 60.6 63.7 66.8 81.1 51.4
Loss Prevention 2.5 4.9 4.6 4.6 4.2 4.2
Misc. direct marketing 15.6 20.9 14.3 15.6 20.9 15.0
MPCS/Purchase orders 20.0 28.3 24.7 29.4 31.9 21.0
All other (payroll, GL,
HR, __ 16.1 22.4 11.4 9.7 4.7 15.0
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Batch CPU (Hours) 202.9 342.2 276.6 320.1 294.7 237.6
CICS CPU (hours) 358.7 603.5 526.1 589.3 587.0 514.5
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0
PRINT 1up(thousands of lines) 60 129 71 72 239 95
PRINT 2up(thousands of lines) 3 0 1 140 13 5
MICROFICHE (pages) 5,147 3,370 5,309 4,883 11,921 3,768
DATA ENTRY (records) 8,010 9,060 10,580 9,670 17,893 8,000
REMOTE PRINT 75,618 156,333 138,120 129,685 145,170 130,821
TEST
BATCH CPU (hours) 122.1 71.6 70.8 52.7 194.7 125.0
CICS CPU (hours) 12.9 15.8 7.5 8.5 7.2 12.8
PRINT 1up(thousands of lines) 775 2,201 839 676 1,736 975
PRINT 2up(thousands of lines) 163 62 1,513 4 95 53
OTHER
NETWORK SUPPORT 543 544 544 545 544 544
ACCOUNTING SYSTEM 0 0 0 0 0 0
PAYROLL USAGE (checks) 8,370 11,418 9,034 6,916 11,375 9,100
DEDICATED DISK (hours) 114.0 133.0 133.0 133.0 131.4 137.1
SARVIEW 6,665 9,804 7,101 8,588 9,600 7,100
AUG SEP OCT NOV DEC JAN TOTALS
(4) (5) (4) (4) (5) (4) (52)
PRODUCTION
BATCH CPU (hours)
Telemarketing 54.8 103.3 51.9 88.3 80.0 70.0 841.5
Finance 18.0 30.0 36.0 41.0 36.0 22.0 353.8
Merchandising 19.0 21.0 22.0 20.0 24.0 20.0 246.9
Marketing 57.0 71.0 42.0 56.0 50.0 29.0 598.0
Fulfillment 51.2 66.0 64.9 71.1 75.0 59.7 756.5
Loss Prevention 4.2 5.0 5.0 5.0 5.0 4.2 53.4
Misc. direct marketing 15.0 20.0 15.0 15.0 200 15.0 202.3
MPCS/Purchase orders 20.0 28.0 20.0 22.0 28.0 22.0 295.3
All other (payroll, GL,
HR, __ 15.0 20.0 15.0 15.0 200 15.0 181.3
------- ------- ------- ------- -------- ------- ---------
Batch CPU (Hours) 254.3 364,3 301.6 333.4 340.0 256.9 3,526.8
CICS CPU (hours) 499.2 853.0 688.9 701.2 833.4 499.7 7,362.5
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
PRINT 1up(thousands of lines) 1,546 227 89 87 334 3,274 6,203
PRINT 2up(thousands of lines) 84 12 5 4 18 179 464
MICROFICHE (pages) 7,457 11,921 3,768 7,457 11,921 3,768 80,690
DATA ENTRY (records) 10,000 12,900 10,000 10,000 12,000 6,000 124,113
REMOTE PRINT 120,910 181,652 196,460 186,875 196,969 137,320 1,794,133
TEST
BATCH CPU (hours) 125.0 200.0 150.0 100.0 150.0 120.0 1,481.9
CICS CPU (hours) 13.9 14.9 10.8 11.4 14.2 11.6 141.5
PRINT 1up(thousands of lines) 1,418 1,567 1,128 1,531 3,413 2,033 18,292
PRINT 2up(thousands of lines) 77 85 62 83 186 111 2,514
OTHER
NETWORK SUPPORT 544 544 544 544 544 574 6,528
ACCOUNTING SYSTEM 0 0 0 0 0 0 0
PAYROLL USAGE (checks) 9,100 11,375 9,100 9,100 11,375 9,100 117,363
DEDICATED DISK (hours) 137.1 139.6 139.6 139.6 139.6 139.6 1,610.9
SARVIEW 7,100 9,600 7,100 7,100 8,800 7,100 97,056
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Total CPU 12,512.7
Attachment II
to Annex A
to Service Agreement
FISCAL 1998 COMPUTER UTILIZATION PLAN
PLANNED USAGE FOR XXXXXXXX'X OF BOSTON
PLAN PLAN PLAN PLAN PLAN PLAN
FEB MAR APR MAY JUN JUL
CURRENT PRODUCTION
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Batch CPU (hours)
Telemarketing 43.1 83.7 84.1 72.1 48.5 59.0
Finance 20.3 32.3 39.4 33.8 32.4 19.5
Merchandising 18.0 20.0 20.4 20.1 20.8 17.1
Marketing 35.2 67.0 33.8 69.6 50.5 38.2
Fulfillment 53.1 62.6 74.3 71.1 81.1 53.2
Loss Prevention 2.6 4.9 4.9 4.6 4.2 4.2
Misc. direct marketing 16.6 21.1 14.9 15.8 20.9 16.2
MPCS/Purchase orders 21.3 25.6 25.9 29.7 31.9 21.2
All other (payroll, G/L, HR
etc.) 21.1 22.9 12.8 4.1 4.7 15.4
------ ------- ------- ------- ------- -------
Batch CPU (Hours) 231.3 349.2 310.1 320.9 294.9 242.9
CICS CPU (Hours) 483.5 916.5 791.0 612.7 575.3 530.3
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0
Print 1up(lines x 1000) 66 142 78 3,247 263 105
Print 2up(lines x 1000) 3 0 1 177 14 6
Microfiche (pages) 6,663 3,530 5,573 7,812 11,921 3,956
Data Entry (Records) 10,650 9,491 13,099 11,679 17,893 8,400
Remote Print 90,951 150,800 155,566 131,524 145,170 134,746
PLAN
PLAN PLAN PLAN PLAN PLAN PLAN FULL
AUG SEP OCT NOV DEC JAN YEAR
CURRENT PRODUCTION
------------------
Batch CPU (hours)
Telemarketing 60.4 113.6 92.8 91.2 82.1 67.7 898.2
Finance 19.3 32.1 39.4 42.0 38.7 21.5 370.7
Merchandising 19.3 21.3 22.4 20.1 24.1 19.9 249.4
Marketing 57.8 72.0 42.8 56.3 50.2 28.9 602.2
Fulfillment 56.3 72.6 73.6 73.5 77.0 57.7 806.0
Loss Prevention 4.3 5.1 5.2 5.5 6.5 4.2 56.3
Misc. direct marketing 15.4 20.6 16.5 17.1 22.2 18.9 212.2
MPCS/Purchase orders 20.6 28.8 20.6 22.2 28.2 21.6 300.9
All other (payroll, G/L, HR
etc.) 16.1 21.4 18.4 15.4 20.4 14.6 185.3
------- ------- ------- ------- ------- ------- ---------
Batch CPU (Hours) 269.5 387.6 329.0 343.3 349.4 253.1 3,681.2
CICS CPU (Hours) 572.1 952.7 827.9 737.3 679.6 487.6 8,166.6
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Print 1up(lines x 1000) 1,791 250 98 74 367 3,601 9,991
Print 2up(lines x 1000) 65 13 6 4 20 197 526
Microfiche (pages) 8,522 13,624 4,486 7,012 12,375 3,599 91,063
Data Entry (Records) 11,429 14,743 11,905 10,476 12,457 5,714 137,966
Remote Print 131,274 197,222 218,912 192,214 201,471 133,397 1,893,277
TEST
----
Batch CPU (Hours) 134.3 78.8 77.0 64.7 214.2 137.5
CICS CPU (Hours) 14.2 17.4 8.3 19.4 7.9 14.1
Print 1up(lines x 1000) 853 2,421 840 1,401 1,910 1,073
Print 2up(lines x 1000) 170 90 1,654 76 105 58
OTHER
-----
Network Support(per mo) 544 544 544 544 544 544
Accounting System 0 0 0 0 0 0
Payroll Usage System (checks) 8,370 11,418 9,034 9,100 11,375 9,100
Dedicated Disk(GB/month) 177.6 177.6 197.6 175.7 170.8 175.9
Sarview 7,332 10,764 7,811 7,810 10,780 7,810
JANUARY 5 WEEK MONTH ADJUSTMENT (CPU Hours) 50.0 50.0
-------------------------------------------
NEW PRODUCTION
--------------
Xxxxxx Technologies (34.6) (112.4) (107.9) (195.3) (184.9) (233.7)
Tracking Mdse from
Pic to Pack 0.0 0.0 0.0 3.2 3.4 2.4
C.A.R. Processing 0.0 0.0 0.0 3.2 3.4 2.4
Multiple Releases 0.0 0.0 0.0 0.0 0.0 0.0
Merchandising projects 0.0 0.0 0.0 0.0 0.0 0.0
Control Item Costs, Retail
Xxxx On, Coverage Model to
Item Planning, Key Item
Planning, Vendor Performance,
Expand MPCS Database
Liquidations Management 0.0 0.0 0.0 0.7 0.7 0.7
PO/Receiving/AP Integration 0.0 0.0 0.0 0.0 0.0 0.0
Link Shipping & Customer
Order Systems 0.0 0.0 0.0 0.0 0.0 0.0
DB2 Conversions
House File 0.0 0.0 0.0 0.0 0.0 0.0
Order, Inventory, Binbox,
etc. 0.0 0.0 0.0 0.0 0.0 0.0
Marketing CDC Database 0.0 0.0 0.0 0.0 0.0 0.0
TOTAL NEW PRODUCTION (34.8) (112.4) (107.9) (188.2) (177.4) (228.1)
=======
Feb. - July Total CPU: 6,446.4
TEST
----
Batch CPU (Hours) 137.5 220.0 165.0 110.0 165.0 132.0 1,636.8
CICS CPU (Hours) 15.3 16.4 11.9 12.5 15.6 12.5 165.7
Print 1up(lines x 1000) 1,560 1,724 1,241 1,684 3,754 2,236 20,696
Print 2up(lines x 1000) 85 94 68 91 205 122 2,837
OTHER
-----
Network Support(per mo) 544 544 544 544 544 544 6,528
Accounting System 0 0 0 0 0 0 0
Payroll Usage System (checks) 9,100 11,375 9,100 9,100 11,375 9,100 117,547
Dedicated Disk(GB/month) 193.5 197.0 202.2 156.7 185.6 176.3 2,217.1
Sarview 7,810 10,780 7,810 7,810 10,780 7,810 105,127
JANUARY 5 WEEK MONTH ADJUSTMENT (CPU Hours)
-------------------------------------------
NEW PRODUCTION
-----------------------------
Xxxxxx Technologies (292.3) (522.1) (442.4) (398.7) (361.1) (252.3) (3,128.1)
Tracking Mdse from
Pic to Pack 2.8 3.8 3.6 3.2 3.3 2.5 28.3
C.A.R. Processing 2.8 3.6 3.6 3.2 3.3 2.5 28.3
Multiple Releases 0.0 0.7 0.8 0.6 0.7 0.7 3.2
Merchandising projects 3.4 4.5 4.2 3.9 4.3 3.3 23.9
Control Item Costs, Retail
Xxxx On, Coverage Model to
Item Planning, Key Item
Planning, Vendor Performance,
Expand MPCS Database
Liquidations Management 0.7 1.4 0.7 0.7 1.4 0.7 7.7
PO/Receiving/AP Integration 1.1 1.7 2.1 2.2 2.0 1.1 10.2
Link Shipping & Customer
Order Systems 1.4 1.9 1.6 1.6 1.7 1.2 9.6
DB2 Conversions
House File 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Order, Inventory, Binbox,
etc. 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Marketing CDC Database 0.0 0.0 0.0 0.0 0.0 0.0 0.0
TOTAL NEW PRODUCTION (280.1) (503.8) (425.9) (383.3) (334.5) (240.3) (3,016.7)
=========
Total CPU: 10,585.6
Attachment II
to Annex A
to Service Agreement
FISCAL 1999 COMPUTER UTILIZATION PLAN
PLANNED USAGE FOR XXXXXXXX'X OF BOSTON
PLAN PLAN PLAN PLAN PLAN PLAN
FEB MAR APR MAY JUN JUL
CURRENT PRODUCTION
------------------
Batch CPU (hours)
Telemarketing 44.1 85.7 86.0 73.7 49.6 60.4
Finance 20.7 32.6 40.0 34.4 32.9 19.6
Merchandising 18.1 26.0 20.4 20.2 20.9 17.1
Marketing 35.3 67.3 33.7 69.9 50.7 38.3
Fulfillment 53.4 54.1 76.0 72.7 83.0 54.4
Loss Prevention 2.6 4.9 4.9 4.6 4.2 4.3
Misc. direct marketing 16.7 21.3 15.0 15.9 21.0 15.3
MPCS/Purchase orders 21.4 26.6 26.1 29.9 32.1 21.4
All other (payroll, G/L, HR
etc.) 21.5 23.3 13.0 4.2 4.6 15.6
------ ------- ------- ------- ------- -------
Batch CPU (Hours) 234.7 354.2 315.2 326.6 298.2 246.6
CICS CPU (Hours) 499.6 947.0 817.3 633.9 594.5 545.0
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0
Print 1up(lines x 1000) 73 136 66 3,512 289 115
Print 2up(lines x 1000) 4 0 1 195 16 6
Microfiche (pages) 7,091 3,640 6,792 8,073 12,316 4,018
Data Entry (Records) 11,026 9,888 13,536 12,068 18,409 8,610
Remote Print 94,014 165,160 160,751 135,909 150,009 139,237
PLAN
PLAN PLAN PLAN PLAN PLAN PLAN FULL
AUG SEP OCT NOV DEC JAN YEAR
CURRENT PRODUCTION
------------------
Batch CPU (hours)
Telemarketing 61.8 116.3 95.0 91.4 81.0 68.2 919.2
Finance 19.6 32.7 40.5 42.7 30.4 21.8 376.9
Merchandising 18.3 21.4 22.5 20.2 24.2 20.0 250.3
Marketing 57.0 72.3 42.9 56.5 50.4 29.0 604.2
Fulfillment 57.6 74.3 75.3 75.2 77.8 58.1 824.8
Loss Prevention 4.3 5.2 5.2 5.6 6.6 4.2 56.7
Misc. direct marketing 15.5 20.7 15.7 17.3 21.3 17.0 213.6
MPCS/Purchase orders 20.7 29.0 20.9 22.4 24.4 21.9 302.9
All other (payroll, G/L, HR
etc.) 16.3 21.8 18.7 15.6 21.7 14.9 188.4
------- ------- ------- ------- ------- ------- ---------
Batch CPU (Hours) 273.3 393.5 334.9 349.7 350.7 257.0 3,736.9
CICS CPU (Hours) 591.2 984.5 835.5 761.9 701.3 505.9 8,438.8
IMS CPU (hours) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Print 1up(lines x 1000) 1,871 275 108 61 404 3,952 10,990
Print 2up(lines x 1000) 94 15 6 5 22 217 579
Microfiche (pages) 8,806 14,028 4,635 8,073 12,788 3,708 94,099
Data Entry (Records) 11,810 15,234 12,302 10,825 12,872 6,903 142,565
Remote Print 135,850 203,790 226,210 198,621 208,157 137,843 1,956,387
TEST
----
Batch CPU (Hours) 147.7 88.6 85.7 71.1 235.6 151.3
CICS CPU (Hours) 15.6 19.1 9.1 21.3 8.7 15.5
Print 1up(lines x 1000) 915 2,613 924 1,512 2,801 1,130
Print 2up(lines x 1000) 107 99 1,831 83 115 64
OTHER
-----
Network Support(per mo) 544 544 544 544 544 544
Accounting System 0 0 0 0 0 0
Payroll Usage System (checks) 8,370 11,418 9,034 9,100 11,375 9,100
Dedicated Disk(GB/month) 217.7 217.7 241.9 215.1 209.1 215.4
Sarview 8,015 11,863 8,592 8,591 11,858 8,591
NEW PRODUCTION
--------------
Xxxxxx Technologies (242.5) (483.7) (420.1) (324.3) (282.8) (289.6)
Tracking Mdse from
Pic to Pack 2.6 3.9 3.7 3.3 3.5 3.5
C.A.R. Processing 2.6 3.9 3.7 3.3 3.5 3.5
Multiple Releases 0.6 0.7 0.8 0.6 0.7 0.6
Merchandising projects 3.2 5.1 4.3 4.1 4.1 3.3
Control Item Costs, Retail Xxxx
On, Coverage Model to Item
Planning, Key Item Planning,
Vendor Performance, Expand
MPCS Database
Liquidations Management 0.7 1.4 0.7 0.7 0.7 0.7
PO/Receiving/AP Integration 1.9 1.8 2.1 1.8 1.7 1.1
Link Shipping & Customer
Order
Systems 1.3 2.0 1.9 1.7 1.8 1.3
DB2 Conversions
House File 0.0 0.0 0.0 0.0 0.0 0.0
Order, Inventory, Binbox,
etc. 0.0 0.0 0.0 0.0 0.0 0.0
Marketing CDC Database 0.0 0.0 0.0 0.0 0.0 0.0
TOTAL NEW PRODUCTION (230.4) (464.9) (401.0) (308.8) (268.8) (271.7)
TEST
----
Batch CPU (Hours) 151.3 242.0 185.0 120.0 185.0 145.2 1,800.5
CICS CPU (Hours) 16.8 18.0 10.1 13.8 17.2 14.0 182.2
Print 1up(lines x 1000) 1,716 1,896 1,365 1,853 4,130 2,450 22,766
Print 2up(lines x 1000) 93 103 75 100 225 134 3,121
OTHER
-----
Network Support(per mo) 544 544 544 544 544 544 6,528
Accounting System 0 0 0 0 0 0 0
Payroll Usage System (checks) 9,100 11,375 9,100 9,100 11,375 9,100 117,547
Dedicated Disk(GB/month) 230.9 241.2 247.5 228.5 227.2 218.8 2,713.7
Sarview 8,591 11,858 8,591 8,591 11,858 8,521 115,639
NEW PRODUCTION
--------------
Xxxxxx Technologies (301.7) (538.7) (456.5) (411.4) (352.3) (264.3) (4,373.8)
Tracking Mdse from
Pic to Pack 2.9 3.9 3.7 3.3 3.4 2.5 39.4
C.A.R. Processing 2.9 3.9 3.7 3.3 3.4 2.5 39.4
Multiple Releases 0.6 0.7 0.6 0.6 0.7 0.7 7.6
Merchandising projects 3.5 4.9 4.3 4.0 4.3 3.3 48.3
Control Item Costs, Retail Xxxx
On, Coverage Model to Item
Planning, Key Item Planning,
Vendor Performance, Expand
MPCS Database
Liquidations Management 0.7 1.4 0.7 0.7 1.4 0.7 10.5
PO/Receiving/AP Integration 1.1 1.6 2.1 2.2 2.1 1.2 20.0
Link Shipping & Customer
Order Systems 1.5 2.0 1.6 1.7 1.7 1.3 19.7
DB2 Conversions
House File 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Order, Inventory, Binbox,
etc. 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Marketing CDC Database 0.0 0.0 0.0 0.0 0.0 0.0 0.0
TOTAL NEW PRODUCTION (281.6) (520.0) (439.6) (395.6) (346.3) (245.1) (4,188.8)
Attachment III
to Annex A
to Services Agreement
Performance Targets for Computing Services
------------------------------------------
Item Fiscal Quarter Goal
---- -------------------
Hardware/Software Availability 99.0%
TSO Availability 99.0%
On-Line Application Availability 98.0%
Report Delivery on Schedule 97.0%
Response Time Target
IMS-All (95 Percentile) 5.0 sec.
TSO-All (95 Percentile) 3.0 sec.
CICS-All (95 Percentile) 5.0 sec.
DB2-All (95 Percentile) 5.0 sec.
The targets above will continue to be calculated and reported monthly in the
same manner they were reported prior to June, 1996.
Note: All Fiscal Quarter Goals to be renegotiated annually as part of annual
budgeting process. All Fiscal Quarter Goals for future Firm Periods are based
upon technical design document review by TJX prior to construction.
These performance targets assume Brylane's conformity with TJX's operating
standards.
Annex B
Treasury Services
-----------------
The following services will be provided to Brylane:
1. Treasury Services
-----------------
Assistance with the establishment of Trustee accounts at State Street Bank
and Trust Co. for the Brylane 401(k) Plan.
2. Letters of Credit
-----------------
At the Closing, COB will have outstanding Letters of Credit (the "Letters
of Credit") through the First National Bank of Boston and the First
National Bank of Chicago (the "Banks") relating to the purchase of
merchandise. TJX and Brylane agree that these Letters of Credit shall
remain outstanding until they are drawn down under the normal course of
business or expire. TJX will continue to provide services with respect to
these Letters of Credit on Brylane's behalf.
TJX will provide Brylane with the information provided to them by the Banks
regarding COB's Letters of Credit, and Brylane will instruct TJX as to any
action to be taken with respect to the Letters of Credit.
TJX will fund draw downs under the Letters of Credit, upon notification
from the Banks. TJX will notify Brylane of the amounts drawn against the
Letters of Credit and shall provide the Brylane's Chief Financial Officer,
copies of all relevant documents via facsimile transmission as promptly as
practicable (Fax No. (000) 000-0000). If such facsimile copies are
received by Brylane on or before 11:00 a.m. (EST) on any week day when
banks are open for business in New York, Massachusetts and Pennsylvania (a
"Business Day"), Brylane will reimburse TJX for such amounts by wire
transfer of immediately available federal funds or by another agreed upon
mechanism whereby TJX shall receive good funds as soon as practicable, but
in no
event later than 5:00 p.m. on the Business Day TJX funds the draw downs. In
the case of facsimile copies received after 11:00 a.m. (EST), good funds
shall be transferred from Brylane to TJX on the immediately succeeding
Business Day.
If Brylane shall fail to reimburse TJX with good funds on the applicable
Business Day as required above, Brylane shall pay to TJX interest on the
funds so owed at an annual rate equal to the Prime Rate (the rate of
interest from time to time announced by the First National Bank of Boston
as its prime rate) until paid, accruing on a daily basis, provided that the
obligation to pay interest hereunder shall not relieve Brylane of its
obligation to reimburse TJX promptly.
3. EFT Tax Payments
----------------
COB is currently required to make certain of its state sales, withholding
and income tax payments electronically (the "EFT Payments"), via the ACH
credit or ACH debit method. TJX has been making these payments on behalf
of COB upon notification from COB when taxes are due. TJX is required to
deposit these payments with its bank one day prior to the tax due date.
TJX and Brylane agree that TJX will continue to make the EFT Payments with
respect to the COB business until the earlier of the end of Fiscal Year
1997 or Brylane has established procedures to handle this function
independently.
Brylane will continue to provide TJX with the necessary details pertaining
to each of its EFT Payments at least two Business Days prior to the EFT
Payment due date. In addition, Brylane will reimburse TJX for such amounts
by wire transfer of immediately available federal funds or by another
agreed upon mechanism whereby TJX shall receive good funds as soon as
practicable, but in no event later than on the Business Day TJX is required
to deposit the EFT Payments with its bank.
B-2
If Brylane shall fail to reimburse TJX with good funds on the applicable
Business Day as required, Brylane shall pay to TJX interest on the funds so
owed at the Prime Rate until paid, provided that the obligation to pay
interest hereunder shall not relieve Brylane of its obligation to reimburse
TJX promptly.
B-3
Annex C
Corporate Payroll Services
--------------------------
Description of Services
-----------------------
TJX Corporate Financial Accounting Department will provide the following payroll
services to Brylane, but only with respect to Purchased Assets:
Submission of transmittals to Production Control for scheduling and
processing the payroll system.
Perform reconciliations for gross and net pay, 401(k) contributions and
direct deposit amounts. Send confirmation letters to Brylane.
Maintain control logs for payroll check stock and signature overlay.
Maintenance of payroll tables for Brylane data for: Earnings and
deductions and these limits - tax locations, H&W rates and eligibility, and
tax rates.
Distribution of payroll reports and tapes.
Submission of third-party reporting to vendors, including: Direct deposit,
savings bonds, H&W, 401(k), and unemployment compensation.
Coordinate systems maintenance activities with CIS (Corporate Systems
Development and Production Control).
Produce quarterly and year-end payroll tax reporting.
Produce individual W-2 form reprints for prior year W2's.
Coordinate and implement Brylane's related programs including: United Way,
bonus payouts, leased auto adjustments, stock options, earnings adjustments
and deferred compensation.
Provide periodic assistance regarding questions and issues relating to the
payroll system, payroll operations, and payroll taxes.
Quarterly and/or year-end reporting services, following the period payroll
was processed by TJX, will continue for three months following the period
payroll check processing has ceased at no additional fee.
All of these services will be provided to Brylane at a rate of $4,000 per month
through January 31, 1998. Thereafter, this rate will be negotiated annually by
October 1 of each year (for service which will be provided in the following
fiscal year). This service can be terminated at the end of any fiscal quarter
after July 31, 1997, provided written notification has been received by TJX
sixty days prior to the termination date. The termination of this service must
be coordinated with the Payroll services provided in Annex A. Upon termination
of the Payroll services provided in Attachment I of Annex A, this service must
also terminate.
C-2
Annex D
TJX will use commercially reasonable best efforts to make available to
Brylane upon reasonable notice the legal services of Xxxxxx Xxxx for an
aggregate of up to 15 hours (at a rate of $300/hr.) through December 31, 1997.
Such service will be related to negotiations and relations with the United
Needleworkers of America union located at Xxxxxxxx'x West Bridgewater locality.
