Exhibit 10.15
XXXXXX ENTERPRISES, INC.
000 Xxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
November 14, 1997
County Seat Stores, Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
This letter agreement (this "Agreement") confirms that County Seat
Stores, Inc. (the "Company") has retained Xxxxxx Enterprises, Inc. (the
"Consultant") to provide certain consulting services, which are more fully
described herein and in Annex A hereto, upon the terms and conditions set
forth below.
1. Retention; Independent Contractor Status. (a) The Company hereby
retains the Consultant to provide certain sourcing, merchandising, financial
budgeting, store management, and other related services to the Company more
fully described in Annex A hereto (the "Consulting Services"), and the
Consultant hereby accepts such retention. The Company hereby confirms that
the Consultant is being retained only to provide the Consulting Services in
accordance with the terms hereof and not to provide any other services,
including all or any portion of the Company's general financial,
merchandising, retailing, store management, or other service needs or advice
relating thereto except as provided herein.
(b) The parties hereto intend that an independent contractor
relationship be created by this Agreement, and nothing herein shall be
construed as creating any employer/employee relationship, partnership, joint
venture, or other business relationship, business group or concerted action.
The personnel performing services under this Agreement shall at all times be
under the Consultant's exclusive direction and control and shall be employees
of the Consultant and not of the Company. The Consultant shall pay all wages,
salaries, and other amounts due to its employees in connection with this
Agreement and shall be responsible for all reports and obligations respecting
them relating to social security, income tax withholding, unemployment
compensation, workers' compensation, and similar matters.
(c) During performance of the Consulting Services, the Consultant shall
be an independent contractor and not an agent of the Company. The Consultant
shall supervise the performance of its own services and shall have control of
the manner and means by which its services are performed, subject to the
terms hereof.
2. Compensation. In consideration of and full payment for the
Consulting Services rendered and to be rendered hereunder by the Consultant
and its affiliates (as defined below) and reimbursement of all of their
related costs and expenses, the Company shall make the following payments to
the Consultant on the first business day of each month (the "Monthly Fee"):
(i) an
County Seat Stores, Inc.
November 14, 1997
Page 2
amount equal to 50%, 75%, and 75%, respectively, of the monthly salary and
benefits payable by the Consultant to Xxxxxx Xxxxxxx, Amaz Zivony, and Xxxxx
Xxxxxx, as reflected on the Consultant's payroll and (ii) $40,000 per month
for additional services to be provided by the Consultant, which services are
detailed on Annex A hereto; provided, however, that from each payment of the
Monthly Fee the Company shall deduct an amount equal to $5,000 (the "Monthly
Rental Share"), which deduction shall constitute payment in full of all
obligations of the Consultant to share in the payment of the monthly rental
fee for any office space shared by the Consultant with the Company and
located in New York City; provided further that the Company's entire right to
payment of the Monthly Rental Share shall be subsumed by the right to make
the foregoing deduction from the Monthly Fee, and in no event shall the
Consultant have any independent obligation to pay all or any portion of the
Monthly Rental Share from any other funds.
3. Term; Termination. This Agreement shall have a term of five years
commencing from the date of this Agreement; provided, however, that either
party may in its sole discretion terminate this Agreement upon at least 30
days' prior written notice to the other specifying the date of termination
(the "Termination Date"). Upon any such termination of this Agreement or
expiration in accordance with its terms, the Company shall pay the
Consultant, and the Consultant shall be entitled to receive, no later than
the Termination Date, payment in full of all amounts payable to the
Consultant pursuant to Section 2 above through the Termination Date.
4. Confidentiality; Etc. Neither party hereto shall (i) divulge any
trade secrets or other confidential information of the other party or (ii)
divert any corporate opportunity of the other party to itself. Any
information (written, oral or observed) received by either party hereto
during the term of this Agreement as a result of the arrangements provided
for herein shall be deemed to be confidential. Such information (x) may not
be used, in the case of the Company if about the Consultant, and (y) may only
be used, in the case of the Consultant if about the Company, only in the
provision of the Consulting Services hereunder. The confidential information
subject to this Section 4 does not include information that either party
hereto can demonstrate (I) was or has become generally available to the
public other than as a result of a disclosure by such party or any of its
affiliates, (II) was available to such party on a non-confidential basis
prior to its disclosure to such party by or on behalf of the other party in
connection with this Agreement, (III) is information that has become
available to either party on a non-confidential basis from a source other
than the first party or its representative properly entitled to possess such
information, provided that such source is not bound by a confidentiality
agreement with the first party and is not otherwise prohibited from
furnishing any such information by a contractual, legal or fiduciary
obligation to such first party, or (IV) is or was developed by either party
or its representatives independently of and without reference to information
furnished by or on behalf of the other party.
County Seat Stores, Inc.
November 14, 1997
Page 3
5. Survival of Certain Provisions. The compensation agreements in
Section 2 and 3 above, the confidentiality agreement in Section 4 above and
the indemnification provisions in Section 7 below shall remain operative and
in full force and effect regardless any termination or expiration of this
Agreement or the Consulting Services and shall be binding on, and inure to
the benefit of, any successors, assigns, heirs, and personal representatives
of the Company, the Consultant and the Indemnified Parties (as defined below).
6. Attorneys' Fees. All attorney fees and expenses incurred by the
Consultant pertaining to this Agreement shall be paid by the Company.
7. Indemnification. (a) The Company agrees that if the Consultant,
any of its affiliates or any of their officers, directors, shareholders,
counsel, employees or agents (each, an "Indemnified Party") is made a party,
or is threatened to be made a party, to any action, suit or proceeding,
whether civil, criminal, administrative or investigative by reason of the
Consultant having entered into, performed or allegedly failed to perform this
Agreement or by reason of the fact that any Indemnified Party was a director,
officer, member, executive or agent of the Company or its affiliates or is or
was serving at the request of the Company or its affiliates as a director,
officer, member, executive or agent of another corporation, partnership,
joint venture, trust or other enterprise (a "Proceeding"), the Indemnified
Party shall be indemnified and held harmless by the Company, to the fullest
extent permitted or authorized by law, against all cost, expense, liability
and loss (including, without limitation, attorney's fees and expenses,
judgments, fines, penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by the Indemnified Party in connection
therewith, and such indemnification shall continue as to the Indemnified
Party even if the Indemnified Party has ceased to be a director, member,
executive or agent of the Company or its affiliates or other entity and shall
inure to the benefit of the Indemnified Party's successors, heirs, executors
and administrators; provided, however, that the Company shall not be
responsible for any such cost, expense, liability and loss to the extent that
it is finally judicially determined that they result from actions taken or
omitted to be taken by such Indemnified Party that constitute its own gross
negligence or willful misconduct.
(b) The Company shall pay to the Indemnified Party all reasonable costs
and expenses actually incurred by such Indemnified Party in connection with a
Proceeding within thirty (30) days after receipt by the Company of a written
request for such payment, together with reasonable supporting documentation
required by the Company and an undertaking by the Indemnified Party to repay
the amount of such payment if it shall ultimately be determined that such
Indemnified Party is not entitled to be indemnified against such costs and
expenses.
County Seat Stores, Inc.
November 14, 1997
Page 4
(c) As used herein, the term "affiliate" shall mean, with respect to any
person or entity, any other person or corporation or other business entity
controlling, controlled by or under common control with such person or entity.
8. Notices. Any notice, demand, request or other communication
required or permitted under this Agreement shall be deemed to have been
effectively made or given if in writing, and delivered by hand, mailed by
registered or certified mail, postage prepaid, return receipt requested, or
sent by reputable overnight courier service, properly addressed as (a) if to
the Company, at the address set forth above, and (b) if to the Consultant or
any of its affiliates, to the Consultant at its offices at 000 Xxxxx Xxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention: President and Chief
Executive Officer, with a copy to Xxxxx & Xxx Xxxxxx, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxx, Esq., or in any such case
to such other address as furnished by a party in writing pursuant to this
Section 8. Telecopiers may be used for convenience only and the delivery of
any notice, demand, request or other communication by telecopy or facsimile
shall not be sufficient for purposes of giving notice hereunder.
9. Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.
10. No Third Party Beneficiaries. This Agreement has been and is made
solely for the benefit of the Company and the Consultant and the other
Indemnified Parties referred to herein and their respective successors' and
assigns, and no other person or entity shall acquire or have and right under
or by virtue of this Agreement.
11. Assignment and Succession. The rights and obligations of the
parties hereunder shall inure to the benefit of an be binding upon their
respective successors and assigns. Neither party's rights or obligations
hereunder shall be assigned or delegated without the prior written consent of
the other party, and any assignment or delegation in violation of this
sentence shall be void.
12. Entire Agreement; Amendments. This instrument contains the entire
agreement between the parties as to the subject matter hereof. All prior
employment understandings and agreements regarding compensation or bonus
compensation, other terms of employment and negotiations and agreements with
respect thereto are merged herein and are deemed canceled. Any amendment or
modification hereto must be in writing and signed by all parties hereto.
County Seat Stores, Inc.
November 14, 1997
Page 5
13. Severability. The invalidity, illegality, or unenforceability of
any provision hereof shall not in any way affect, impair, invalidate or
render unenforceable this Agreement or any other provision hereof.
14. Governing Law. This Agreement shall at all times be governed by and
construed, interpreted and enforced in accordance with laws of the State of
New York, without regard to principles of conflicts of law.
Please sign and return an original and one copy of this letter to the
undersigned to indicate your acceptance of the terms set forth herein,
whereupon this letter Agreement and your acceptance shall constitute a
binding agreement between the Company and the Consultant effective as of July
1, 1997 (it being understood that the Consultant shall be retained and the
compensation provided for under this Agreement shall be payable as of such
date).
COUNTY SEAT STORES, INC.
By:
-----------------------------
Name:
Title:
XXXXXX ENTERPRISES, INC.
By:
-----------------------------
Name:
Title:
Annex A
to Consulting Agreement
DESCRIPTION OF CONSULTING SERVICES
The following is a partial listing of services currently provided to
County Seat Stores, Inc. (the "Company") by Xxxxxx Enterprises, Inc. (the
"Consultant"), typically on a day-to-day basis. The following list is not
intended to be either an exhaustive or mandatory list, and the parties to the
Consulting Agreement acknowledge that the precise mix of sea-vices to be
provided by the Consultant to the Company from time to time may vary.
Generally, the Consultant is actively involved in:
- Sourcing and production of products;
- Merchandise assortment and planning;
- In-store merchandising and presentation;
- Purchase and receipt flow;
- Vendor development and relationship management;
- Negotiating payment terms with vendors, and arranging for extensions
of trade credit, including provision offers of credit;
- General administrative support;
- Advice and analysis for efficiency improvement relating to all aspects
of Company operations;
- Management consulting;
- Senior management visits to stores and reporting thereof
- Recruiting and development of store personnel; and
- Real estate analysis, including profitability analyses of individual
stores on a stand-alone basis and in terms of their contribution to
the overall Company enterprise.
