{"id":38932,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-anntaylor-stores-corp-and-j-patrick3.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-anntaylor-stores-corp-and-j-patrick3","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-anntaylor-stores-corp-and-j-patrick3.html","title":{"rendered":"Employment Agreement &#8211; AnnTaylor Stores Corp. and J. Patrick Spainhour"},"content":{"rendered":"<pre>                       EMPLOYMENT AGREEMENT\n                       --------------------\n\n      EMPLOYMENT  AGREEMENT (the \"Agreement\"),  dated as of January\n29,  2002,  between  ANNTAYLOR  STORES   CORPORATION,   a  Delaware\ncorporation  (the  \"Company\"),   and  J.  PATRICK   SPAINHOUR  (the\n\"Executive\").\n\n      WHEREAS,  the Company  desires to provide  for the  continued\nservices and  employment of the Executive  with the Company and the\nExecutive  wishes to provide  such  services  and to  continue  his\nemployment  with the Company,  all in accordance with the terms and\nconditions provided herein.\n\n      NOW,  THEREFORE,  in  consideration  of the  premises and the\nrespective   covenants  and   agreements  of  the  parties   herein\ncontained,  and intending to be legally  bound hereby,  the parties\nhereto agree as follows:\n\n1.    EMPLOYMENT.   The  Company   hereby   agrees  to  employ  the\n      -----------\nExecutive,  and the  Executive  hereby agrees to be employed by and\nto serve  the  Company,  effective  as of  January  29,  2002  (the\n\"Effective Date\"), on the terms and conditions set forth herein.\n\n\n2.    TERM.  The  term  of this  Agreement  shall  commence  on the\n      -----\nEffective  Date  hereof  and  terminate  on May  31,  2005,  unless\nfurther   extended  or  sooner   terminated  as  provided  in  this\nAgreement.  Commencing on June 1, 2005, and on each  anniversary of\nsuch date thereafter (each date, an \"Anniversary  Date\"),  the term\nof the Executive's  employment shall  automatically be extended for\none  additional  year,  unless not later  than six months  prior to\nsuch  Anniversary  Date  either  party  shall have given  notice (a\n\"Nonrenewal  Notice\")  to the other  party that it does not wish to\nextend  this  Agreement.  References  hereinafter  to the \"Term\" of\nthis  Agreement  shall  refer  to both  the  initial  term  and any\nextended   term  of  the   Agreement   hereunder.   Notwithstanding\nexpiration  of the Term or other  provisions  that survive by their\nintent,  the  provisions of Paragraphs  3(b), 9 and 10 hereof shall\ncontinue in effect.\n\n3.    NATURE OF PERFORMANCE.\n      ----------------------\n\n(a)   POSITION AND DUTIES.  The  Executive  shall serve as Chairman\n      --------------------  \nof the Board and Chief  Executive  Officer of the Company and shall\nhave such  responsibilities,  duties and authority  consistent with\nsuch  positions  as may  from  time to time  be  determined  by the\nBoard of  Directors  of the Company (the  \"Board\").  The  Executive\nshall  report  directly to the Board.  The  Executive  shall devote\nsubstantially  all of his working  time to the business and affairs\nof  the  Company;  provided  that,  this  Agreement  shall  not  be\ninterpreted   to  prohibit  the  Executive   from  making   passive\ninvestments,  engaging  in  charitable  activities  or,  subject to\nprior   approval  of  the  Board  (which   approval  shall  not  be\nunreasonably  withheld),  serving on the board of  directors of any\nother corporation.\n\n(b)   INDEMNIFICATION.  To the fullest extent  permitted by law and\n      ---------------\nthe  Company's   certificate  of  incorporation  and  bylaws,   the\nCompany shall  indemnify the Executive for all amounts  (including,\nwithout  limitation,   judgments,   fines,   settlement   payments,\nlosses,   damages,   costs  and  expenses   (including   reasonable\nattorneys'  fees))  incurred or paid by the Executive in connection\nwith any action,  proceeding,  suit or investigation arising out of\nor relating to the  performance  by the  Executive of services for,\nor acting as a fiduciary of any employee  benefit  plans,  programs\nor  arrangements  of  the  Company  or as a  director,  officer  or\nemployee of, the Company or any subsidiary  thereof.  Following the\nTerm,  the Company shall  continue to indemnify the Executive  with\nrespect to such  services  performed  during the Term,  to the same\n\n================================================================================\n2\n\nextent  as  the  Company   indemnifies  its  officers,   directors,\nemployees  and  fiduciaries,  as  applicable.  Executive  shall  be\nprovided director and officer liability  insurance  coverage by the\nCompany on the same  terms and  conditions  as that being  provided\nto any other  director  and  officer  of the  Company  from time to\ntime during the Term hereof.\n\n4.    PLACE OF  PERFORMANCE.  In  connection  with the  Executive's\n      ---------------------\nemployment  by the  Company,  the  Executive  shall be based at the\nprincipal  executive  offices  of the  Company  in the  City of New\nYork or at such other  principal  executive  office in the New York\nCity  Metropolitan  Area as the  Company  may  hereafter  maintain,\nexcept for required travel on the Company's  business.  The Company\nis aware that Executive  maintains his principal  residence and his\nfamily  resides in  Columbus,  Mississippi.  The  Company  has been\nadvised by Executive  that he intends to continue to maintain  such\nresidence  which will require  Executive to commute at  Executive's\nsole cost and expense  between the Company's  headquarters  and his\nresidence in  Mississippi  on a regular  basis to which the Company\nhas no objection.\n\n5.    COMPENSATION AND RELATED MATTERS.\n      --------------------------------\n\n(a)   ANNUAL COMPENSATION.\n      -------------------\n\n(i)   BASE SALARY. During the period of the Executive's  employment\n      -----------\nhereunder,  the Company  shall pay to the  Executive an annual base\nsalary at a rate not less  than  $850,000,  such  salary to be paid\nin  conformity  with the  Company's  policies  relating to salaried\nemployees.  This  salary  may  be  (but  is  not  required  to  be)\nincreased  from time to time,  subject  to and in  accordance  with\nthe annual executive  performance  review procedures of the Company\nand, if so  increased,  shall not  thereafter  be decreased  during\nthe  Term of  this  Agreement.  Compensation  of the  Executive  by\nsalary  payments  shall  not be  deemed  exclusive  and  shall  not\nprevent   the   Executive   from   participating   in   any   other\ncompensation  or benefit plan of the Company.  The salary  payments\n(including any increased  salary  payments)  hereunder shall not in\nany way  limit  or  reduce  any  other  obligation  of the  Company\nhereunder,   and  no  other   compensation,   benefit   or  payment\nhereunder  shall in any way limit or reduce the  obligation  of the\nCompany to pay the Executive's salary hereunder.\n\n\n(ii)  ANNUAL  BONUS.  During the period of  Executive's  employment\n      -------------\nhereunder,  the Executive  shall be eligible to  participate in the\nCompany's  annual  bonus plan as in effect  from time to time,  and\nshall be  entitled  to receive  such  amounts (a \"Bonus\") as may be\nauthorized,  declared  and  paid  by the  Company  pursuant  to the\nterms of such plan;  provided  that,  notwithstanding  any contrary\nprovisions of such bonus plan,  unless the  Executive's  employment\nis  terminated  by the Company  for Cause (as defined in  Paragraph\n6(c) hereof) or by the  Executive  other than for Good  Reason,  as\ndefined  in  Paragraph  6(d)(1)  hereof),  the  Executive  shall be\nentitled  to  receive  any  Bonus  paid with  respect  to any bonus\nperiod  completed  on or prior to the Date of  Termination  or,  in\nthe case a Nonrenewal  Notice is given by the Company,  through the\nscheduled  expiration  date  of the  Term  (even  if the  Executive\nterminates his employment  prior to such scheduled  expiration date\nfor Good Reason under  Paragraph  6(d)(1)(v)  hereof).  The Company\ncurrently  maintains a  Management  Performance  Compensation  Plan\n(the  \"Performance  Plan\")  pursuant  to which it pays  performance\nbonus  compensation to certain of its executives and employees.  It\nis agreed  that  Executive  shall  participate  in the  Performance\nPlan.  Executive's  Performance Percentage (as that term is defined\nin the  Performance  Plan)  shall be  established  at 80% per annum\nduring  the Term.  Executive  shall  also  participate  in the Long\nTerm Cash Incentive  Compensation Plan currently  maintained by the\nCompany  and his Target  Award (as  defined in such plan)  shall be\n50%.\n================================================================================\n3\n\n(b)   STOCK OPTIONS.\n      --------------\n\n(1)   The  Executive  will be granted a  time-vested  Non-Qualified\n      Stock Option to acquire one hundred fifty thousand  (150,000)\n      shares of the  Company's  Common Stock (the \"Option  Shares\")\n      under the Company's  2002 Stock Option and  Restricted  Stock\n      and Unit  Award Plan (the  \"Option  Plan\")  with an  exercise\n      price  equal to the fair market  value (as defined  under the\n      Option Plan) of the Common Stock on the Effective  Date.  The\n      option  shall vest and  become  exercisable  with  respect to\n      one-third  of the  Option  Shares on each of the first  three\n      anniversaries of the Effective Date,  provided  Executive has\n      remained  continuously  employed  by the  Company  until  the\n      applicable  date  (except as  provided in  Paragraph  7(d)(5)\n      hereof).   The   Executive   shall  be  eligible  to  receive\n      additional  options  under  the  Option  Plan  or  other  and\n      additional  option  plans as may be  adopted  by the  Company\n      during the term  hereof,  taking  into  account,  among other\n      things,   Executive's   performance  and  position  with  the\n      Company.\n\n\n(2)   The   Executive   will  be  granted  a   performance   vested\n      Non-Qualified  Stock  Option to  acquire  one  hundred  fifty\n      thousand  (150,000)  shares  of the  Company's  Common  Stock\n      (\"Performance  Option  Shares\") under the Option Plan with an\n      exercise  price  equal to the fair  market  value (as defined\n      under the Option Plan) of the  Company's  Common Stock on the\n      Effective   Date.   Such   option   shall   vest  and  become\n      exercisable,  provided  Executive  has remained  continuously\n      employed by the Company until the applicable  date (except as\n      provided in Paragraph 6(d)(5) hereof), as follows:\n\n\n                (i)  options to purchase 50,000  Performance Option\n                     Shares  shall vest and become  exercisable  as\n                     of March 15, 2003,  if the Company  shall have\n                     achieved  earnings  per share for fiscal  year\n                     2002  of at  least  the  target  earnings  per\n                     share set forth in Exhibit A attached hereto;\n\n\n                (ii) options to purchase 50,000  Performance Option\n                     Shares  shall vest and become  exercisable  as\n                     of March 15, 2004,  if the Company  shall have\n                     achieved  earnings  per share for fiscal  year\n                     2003  of at  least  the  target  earnings  per\n                     share set forth in Exhibit A attached  hereto;\n                     and\n\n\n                (iii)options to purchase 50,000  Performance Option\n                     Shares  shall vest and become  exercisable  as\n                     of March 15, 2005,  if the Company  shall have\n                     achieved  earnings  per share for fiscal  year\n                     2004  of at  least  the  target  earnings  per\n                     share set forth in Exhibit A attached hereto;\n\n\n           (3)  In addition,\n\n                A.   if the Company's  earnings per share for fiscal\n                     year 2002 greater than the target earnings per\n                     share set forth in Exhibit A attached hereto for\n                     such  fiscal  year,  then in  addition  to the\n                     50,000 options to purchase  Performance Option\n                     Shares that vest and become  exercisable as of\n                     March 15,  2003,  a portion of the  options to\n                     purchase  Performance  Option Shares  eligible\n                     to vest on  March  15,  2004  shall  vest  and\n                     become   exercisable  as  of  March  15,  2003\n                     calculated  as follows:  50,000  multiplied by\n                     the   \"Increase    Percentage\"   (as   defined\n================================================================================\n4\n\n                     herein);  As used herein,  the term  \"Increase\n                     Percentage\"  means the difference  between the\n                     actual  earnings  per share for a fiscal  year\n                     and the  target  earnings  per share set forth\n                     in Exhibit A attached  hereto for such  fiscal\n                     year divided by the target  earnings per share\n                     for such  fiscal  year set forth in  Exhibit A\n                     attached hereto.\n\n               B.    if the Company's earnings per share for fiscal year \n                     2003 are greater than the target  earnings per \n                     share for such  fiscal  year set forth in  Exhibit\n                     A attached  hereto,  then  in  addition  to  the\n                     50,000 options to purchase  Performance Option\n                     Shares that vest and become  exercisable as of\n                     March 15,  2004,  a portion of the  options to\n                     purchase  Performance  Option Shares  eligible\n                     to vest on  March  15,  2005  shall  vest  and\n                     become   exercisable  as  of  March  15,  2004\n                     calculated  as follows:  50,000  multiplied by\n                     the Increase Percentage.\n\n\n               C.    if the Company's earnings per share for fiscal\n                     years 2002, 2003 and\/or 2004 are less than 100%\n                     but at least 90% of the target earnings per share\n                     for such  fiscal  year set forth in  Exhibit A\n                     attached  hereto,   then  the  number  of  the\n                     options to purchase  Performance Option Shares\n                     that vest and become  exercisable for any such\n                     fiscal  year shall be  calculated  as follows:\n                     50,000    multiplied    by    the    \"Decrease\n                     Percentage\"  (as  defined  herein).   As  used\n                     herein,  the term \"Decrease  Percentage\" means\n                     the  quotient  obtained by dividing the actual\n                     earnings  per share  for a fiscal  year by the\n                     target   earnings   per  share  set  forth  in\n                     Exhibit A for such fiscal year;\n\n               D.    if the Company shall not have achieved the target \n                     earnings per share set forth in Exhibit A attached\n                     hereto  for fiscal  years  2002,  2003  and\/or\n                     2004,  but the  Company  shall  have  achieved\n                     cumulative  earnings per share  aggregating at\n                     least the aggregate  target earnings per share\n                     for fiscal  years 2002  through 2004 set forth\n                     in  Exhibit  A  attached   hereto,   then  any\n                     options to purchase  Performance Option Shares\n                     that  did not  vest  and  become  exercisable,\n                     pursuant to  subparagraphs  (b)(2)(i)  through\n                     (iii) and (b)(3)A through C above,  shall vest\n                     and become  exercisable  as of March 15, 2005;\n                     and\n\n               E.    any Performance Option Shares that shall not have\n                     vested and become exercisable, pursuant to \n                     subparagraphs (b)(2)(i) through (iii) and (b)(3)A \n                     through D above, as of March 15, 2005, shall lapse\n                     and such portion of the option shall be canceled\n                     immediately upon determination thereof.\n\n\n      The Company  shall enter into Stock  Option  Agreements  with\n      the   Executive   for  the   above   stock   option   grants,\n      incorporating   the  vesting  terms  set  forth  above,   and\n      otherwise  substantially  on the  terms  and  conditions  set\n      forth  in the form of the  Company's  standard  Stock  Option\n      Agreement  previously approved by the Compensation  Committee\n\n================================================================================\n5\n\n      of the Board of  Directors,  including,  but not  limited to,\n      terms providing for accelerated exercisability.\n\n\n(c)   RESTRICTED STOCK.\n      ----------------\n\n(1)   Executive   will   be   granted   fifty   thousand   (50,000)\n      time-vested  restricted shares of Common Stock of the Company\n      (the \"Time  Restricted  Shares\") under the Option Plan on the\n      Effective  Date.  One-third  of the  Time  Restricted  Shares\n      shall vest on, and be  delivered  to the  Executive  promptly\n      following,  each  of the  first  three  anniversaries  of the\n      Effective   Date,   provided  the   Executive   has  remained\n                          --------\n      continuously  employed  by the Company  until the  applicable\n      date.\n\n(2)   The  Executive  will  be  granted  fifty  thousand   (50,000)\n      performance  vested  restricted shares of Common Stock of the\n      Company  (the  \"Performance  Restricted  Shares\")  under  the\n      Option Plan on the Effective  Date.  The  Executive's  rights\n      to the  Performance  Restricted  Shares  shall  vest  and the\n      restrictions thereon shall lapse as follows:\n\n\n                 (i) 16,666  Performance  Restricted  Shares  shall\n                     vest and  become  exercisable  as of March 15,\n                     2003,  if  the  Company  shall  have  achieved\n                     earnings  per share for fiscal year 2002 of at\n                     least the target  earnings per share set forth\n                     in Exhibit A attached hereto;\n\n                (ii) 16,667  Performance  Restricted  Shares  shall\n                     vest and  become  exercisable  as of March 15,\n                     2004,  if  the  Company  shall  have  achieved\n                     earnings  per share for fiscal year 2003 of at\n                     least the target  earnings per share set forth\n                     in Exhibit A attached hereto; and\n\n                (iii)16,667  Performance  Restricted  Shares  shall\n                     vest and  become  exercisable  as of March 15,\n                     2005,  if  the  Company  shall  have  achieved\n                     earnings  per share for fiscal year 2004 of at\n                     least the target  earnings per share set forth\n                     in Exhibit A attached hereto;\n\n\n           (3)  In addition,\n\n                A.   if  the  Company's   earnings  per  share  for\n                     fiscal year 2002 are  greater  than the target\n                     earnings  per share for such  fiscal  year set\n                     forth in  Exhibit A attached  hereto,  then in\n                     addition to the 16,666 Performance  Restricted\n                     Shares  that  vest as of  March  15,  2003,  a\n                     portion of the Performance  Restricted  Shares\n                     eligible  to vest on March 15, 2004 shall vest\n                     as of March 15,  2003  calculated  as follows:\n                     16,666    multiplied    by    the    \"Increase\n                     Percentage\";\n\n                B.   if  the  Company's   earnings  per  share  for\n                     fiscal year 2003 are  greater  than the target\n                     earnings  per share for such  Fiscal  Year set\n                     forth in  Exhibit A attached  hereto,  then in\n                     addition to the 16,667 Performance  Restricted\n                     Shares  that  vest as of  March  15,  2004,  a\n                     portion of the Performance  Restricted  Shares\n                     eligible  to vest on March 15, 2005 shall vest\n                     as of March 15,  2004  calculated  as follows:\n\n================================================================================\n6\n\n                     16,667    multiplied    by    the    \"Increase\n                     Percentage\" (as defined herein);\n\n\n                C.   if  the  Company's   earnings  per  share  for\n                     fiscal  years 2002,  2003 and\/or 2004 are less\n                     than  100%  but at  least  90%  of the  target\n                     earnings  per share for such  fiscal  year set\n                     forth in Exhibit A attached  hereto,  then the\n                     number of Performance  Restricted  Shares that\n                     vest for such fiscal year shall be  calculated\n                     as  follows:  16,666  or  16,667,  as the case\n                     may   be,    multiplied   by   the   \"Decrease\n                     Percentage\";\n\n\n                D.   if the  Company  shall not have  achieved  the\n                     target   earnings   per  share  set  forth  in\n                     Exhibit A attached  hereto  for  fiscal  years\n                     2002,  2003 and\/or 2004, but the Company shall\n                     have  achieved  cumulative  earnings per share\n                     aggregating  at  least  the  aggregate  target\n                     earnings  per  share  for  fiscal  years  2002\n                     through  2004 set forth in  Exhibit A attached\n                     hereto,   then  any   Performance   Restricted\n                     Shares   that   did  not  vest   pursuant   to\n                     subparagraphs   (c)(2)(i)  through  (iii)  and\n                     (c)(3)A  through C above,  shall  vest and the\n                     restrictions  thereon  shall lapse as of March\n                     15, 2005; and\n\n\n                E.   any Performance  Restricted  Shares that shall\n                     not have  vested,  pursuant  to  subparagraphs\n                     (c)(2)(i)  through (iii) and (c)(3)A through D\n                     above   as   of   March   15,   2005,    shall\n                     automatically be forfeited by the Executive.\n\n\nThe Company  shall enter into a  Restricted  Stock Award  Agreement\nwith the  Executive  for each of the  above  grants  of  restricted\nshares,  incorporating  the  vesting  terms  set forth  above  with\nrespect  to  each  such  grant,  and  otherwise  on the  terms  and\nconditions  set  forth  in  the  form  of  Restricted  Stock  Award\nAgreement  previously  approved by the  Compensation  Committee  of\nthe  Board of  Directors  for  restricted  stock  awards  under the\nOption Plan,  including,  but not limited to, terms  providing  for\naccelerated vesting.\n\n\n(d)   OTHER BENEFITS.  During the period of Executive's  employment\n      ---------------\nhereunder,   the  Executive   shall  continue  to  be  entitled  to\nparticipate  in all other  employee  benefit  plans,  programs  and\narrangements  of the  Company,  as now or  hereinafter  in  effect,\nwhich are  applicable  to the Company's  employees  generally or to\nits  executive  officers,  as the case may be,  subject to and on a\nbasis   consistent   with  the  terms,   conditions   and   overall\nadministration  of such plans,  programs and  arrangements.  During\nthe  period of  Executive's  employment  hereunder,  the  Executive\nshall  be  entitled  to  participate  in  and  receive  any  fringe\nbenefits  or  perquisites   which  may  become   available  to  the\nCompany's executive  employees.  Without limiting the generality of\nthe  foregoing,  the  Company  shall  provide  the  Executive  with\nfinancial  planning  and tax  preparation  services  on a  tax-free\nbasis.\n\n\n(e)   VACATIONS AND OTHER LEAVES.  The Executive  shall be entitled\n      --------------------------\nto an aggregate  paid  vacation of not less than four (4) weeks for\neach  twelve  (12) month  period of the Term  hereof.  Payment  for\nany accrued  and unused  vacation  time at the time of  termination\nof  this  Agreement  shall  be in  accordance  with  the  Company's\npolicies at the time of such  termination.  The Executive  shall be\nentitled to paid  holidays  and personal  leave days in  accordance\nwith the Company policy covering executive employees.\n\n================================================================================\n7\n\n(f)   EXPENSES.  During  the period of the  Executive's  employment\n      ---------\nhereunder,  the  Executive  shall be  entitled  to  receive  prompt\nreimbursement  for all reasonable and customary  expenses  incurred\nby the Executive in performing  services  hereunder,  including all\nexpenses  of  travel  and  accommodations  while  away from home on\nbusiness or at the  request of and in the  service of the  Company;\nprovided  that,  such  expenses are incurred and  accounted  for in\naccordance  with the policies  and  procedures  established  by the\nCompany.  It is  understood  and  agreed  by  Executive  that  such\nreimbursement  shall not cover  expenses and costs  incurred by him\nin connection  with his commuting  from his principal  residence as\ndescribed in Paragraph 4 of this Agreement.\n\n\n(g)   SERVICES  FURNISHED.  The Company shall furnish the Executive\n      --------------------\nwith  office  space,   stenographic   assistance   and  such  other\nfacilities  and  services as shall be  suitable to the  Executive's\nposition and adequate for the performance of his duties hereunder.\n\n\n6.    TERMINATION.  The  Executive's  employment  hereunder  may be\n      -----------\nterminated   without  breach  of  this  Agreement  only  under  the\nfollowing circumstances:\n\n\n(a)   DEATH. The Executive's  employment  hereunder shall terminate\n      ------\nupon his death.\n\n(b)   DISABILITY.  If,  as a result of the  Executive's  incapacity\n      ----------\ndue to physical or mental  illness,  the Executive  shall have been\nabsent  from his  duties  hereunder  on a full  time  basis for the\nentire  period of six (6)  consecutive  months,  and within  thirty\n(30) days after written  Notice of  Termination  (as defined below)\nis given  (which may occur  before or after the end of such six (6)\nmonth  period) shall not have  returned to the  performance  of his\nduties hereunder on a full-time  basis, the Executive's  employment\nhereunder shall terminate for \"Disability.\"\n\n(c)   CAUSE.  The Company may terminate the Executive's  employment\n      -----\nhereunder  for  \"Cause\".  For  purposes  of  this  Agreement,   the\nCompany   shall  have   \"Cause\"  to   terminate   the   Executive's\nemployment  hereunder upon (i) the  Executive's  conviction for the\ncommission  of any act or acts  constituting  a  felony  under  the\nlaws of the  United  States or any state  thereof,  (ii)  action by\nthe Executive toward the Company  involving  dishonesty (other than\ngood  faith  expense  account  disputes),   (iii)  the  Executive's\nrefusal to abide by or follow  written  directions  of the Board of\nDirectors,  (iv) the Executive's  gross  nonfeasance which does not\ncease within ten (10)  business  days after notice  regarding  such\nnonfeasance  has been given to the  Executive by the Company or (v)\nfailure  of  the  Executive  to  comply  with  the   provisions  of\nParagraph  9  (prior  to a  cessation  of  employment  following  a\nChange in  Control  of the  Company)  or 10 of this  Agreement,  or\nother willful  conduct by the  Executive  which is intended to have\nand does have a material adverse impact on the Company.\n\n\n(d)   TERMINATION BY THE EXECUTIVE.\n      -----------------------------\n\n(1)   The  Executive may  terminate  his  employment  hereunder for\n      \"Good Reason\". For purposes of this Agreement,  the Executive\n      shall  have  \"Good  Reason\"  to  terminate   his   employment\n      hereunder  (i) upon a failure by the  Company to comply  with\n      any material  provision of this Agreement  which has not been\n      cured  within ten (10)  business  days  after  notice of such\n      noncompliance   has  been  given  by  the  Executive  to  the\n      Company,  (ii) upon  action  by the  Company  resulting  in a\n      diminution of the Executive's title or authority,  (iii) upon\n      the Company's  relocation of the Executive's  principal place\n      of  employment  outside  of the New  York  City  Metropolitan\n      Area,  (iv)  one  year  after a  \"Change  in  Control  of the\n      Company\"  (as defined in  Paragraph  (d)(2)  below) or (v) at\n\n================================================================================\n8\n\n      any  time  following  the  expiration  of  ninety  (90)  days\n \n      following the Company's  issuance of a Nonrenewal Notice. The\n      Executive may terminate his  employment  voluntarily  without\n      Good  Reason upon at least six  months'  prior  notice to the\n      Company.\n\n\n(2)   For purposes of this  Agreement,  a \"Change in Control of the\n      Company\" will be deemed to have occurred if:\n\n\n      (A)  any \"person\",  as such term is used in Paragraphs  13(d)\n           and 14(d) of the  Securities  Exchange  Act of 1934,  as\n           amended (the \"Exchange Act\"),  other than (1) any person\n           who on the date  hereof is a director  or officer of the\n           Company,  (2) any  trustee  or other  fiduciary  holding\n           securities   under  an  employee  benefit  plan  of  the\n           Company,  or (3)  any  corporation  owned,  directly  or\n           indirectly,  by  the  stockholders  of the  Company  (in\n           substantially  the same proportion as their ownership of\n           stock of the  corporation  ) (a  \"Person\") is or becomes\n           the  \"beneficial  owner\" (as defined in Rule 13d-3 under\n           the   Exchange   Act),   directly  or   indirectly,   of\n           securities  of the Company  representing  20% or more of\n           the  combined   voting  power  of  the  Company's   then\n           outstanding voting securities;\n\n      (B)  during any period of two consecutive years,  individuals\n           who at the  beginning  of  such  period  constitute  the\n           Board,  and  any new  director  (other  than a  director\n           designated   by  a  person  who  has  entered   into  an\n           agreement  with the  Company  to  effect  a  transaction\n           described  in clause (A),  (C) or (D) of this  Paragraph\n           6(d)(2))  whose  election by the Board or nomination for\n           election by the Company's  stockholders  was approved by\n           a vote of at least  two-thirds  (2\/3)  of the  directors\n           then still in office who either  were  directors  at the\n           beginning of the period or whose  election or nomination\n           for election was  previously so approved,  cease for any\n           reason to constitute at least a majority thereof;\n\n\n      (C)  there is  consummated a merger or  consolidation  of the\n           Company  with any other  corporation,  other  than (1) a\n           merger  or  consolidation  which  would  result  in  the\n           voting    securities   of   the   Company    outstanding\n           immediately   prior  thereto   continuing  to  represent\n           (either by remaining  outstanding or by being  converted\n           into voting  securities  of the  surviving  entity) more\n           than 80% of the  combined  voting  power  of the  voting\n           securities  of the  Company  or  such  surviving  entity\n           outstanding    immediately    after   such   merger   or\n           consolidation or (2) a merger or consolidation  effected\n           to  implement  a  recapitalization  of the  Company  (or\n           similar  transaction)  in which no Person is or  becomes\n           the   beneficial   owner  (as  defined  in  (A)  above),\n           directly or  indirectly,  of  securities  of the Company\n           representing  20% or more of the  combined  voting power\n           of the Company's then outstanding securities; or\n\n\n      (D)  the  stockholders  of the  Company  approve  a  plan  of\n           complete  liquidation of the Company or an agreement for\n           the  sale  or  disposition  by  the  Company  of  all or\n           substantially all of the Company's assets.\n\n(e)   NOTICE OF  TERMINATION.  Any  termination of the  Executive's\n      ----------------------\nemployment  by  the  Company  or  by  the  Executive   (other  than\ntermination  under  Paragraph 6(a) hereof) shall be communicated by\nwritten  Notice  of  Termination  to  the  other  party  hereto  in\naccordance   with  Paragraph  12  hereof.   For  purposes  of  this\nAgreement,  a \"Notice of  Termination\"  shall  mean a notice  which\nshall   indicate  the  specific   termination   provision  in  this\nAgreement  relied  upon and shall set  forth in  reasonable  detail\n\n================================================================================\n9\n\nthe  facts  and  circumstances  claimed  to  provide  a  basis  for\ntermination of the  Executive's  employment  under the provision to\nindicated.\n\n(f)   DATE OF  TERMINATION.  \"Date of  Termination\"  shall mean (i)\n      --------------------\nif the  Executive's  employment  is  terminated  by his death,  the\ndate  of  his  death,   (ii)  if  the  Executive's   employment  is\nterminated  pursuant to subparagraph  (b) above,  the date which is\nthe  later of thirty  (30) days  after  Notice  of  Termination  is\ngiven  (provided that the Executive  shall not have returned to the\nperformance  of his duties on a full-time  basis during such thirty\n(30)  day  period)  or the  end of the six  (6)  consecutive  month\nperiod  referred  to in  subparagraph  (b) above,  and (iii) if the\nExecutive's  employment is terminated  pursuant to subparagraph (c)\nor (d) above,  the date  specified  in the  Notice of  Termination;\nprovided  that,  if within  thirty  (30) days  after any  Notice of\nTermination   is  given  the  party   receiving   such   Notice  of\nTermination   notifies  the  other  party  that  a  dispute  exists\nconcerning the  termination,  the Date of Termination  shall be the\ndate on which the dispute is finally  determined,  either by mutual\nwritten  agreement  of  the  parties  or  by a  binding  and  final\narbitration award.\n\n7.    COMPENSATION UPON TERMINATION OR DURING DISABILITY.\n      --------------------------------------------------\n\n(a)   DISABILITY.  During any period  that the  Executive  fails to\n      ----------\nperform  his  duties  hereunder  as a result of  incapacity  due to\nphysical  or  mental  illness,  the  Executive  shall  continue  to\nreceive  his  full  salary  at the  rate  then in  effect  for such\nperiod and other applicable  benefits  provided to active employees\nuntil his  employment  is  terminated  pursuant to  Paragraph  6(b)\nhereof.  Subject to the  provisions  of Paragraph 9 hereof,  in the\nevent  the  Executive's   employment  is  terminated   pursuant  to\nParagraph 6(b) hereof, then\n\n\n(i)   as soon as practicable thereafter,  the Company shall pay the\nExecutive  all unpaid  amounts,  if any, to which the  Executive is\nentitled  as of  the  Date  of  Termination  under  Paragraph  5(a)\nhereof  and  shall pay to the  Executive,  in  accordance  with the\nterms of the applicable  plan or program,  all other unpaid amounts\nto which  Executive  is then  entitled  under any  compensation  or\nbenefit  plan or program  of the  Company  (collectively,  \"Accrued\nObligations\"); and\n\n(ii)  following the Date of Termination  and for a period of twelve\n(12) months  thereafter (the \"Disability  Severance  Period\"),  the\nCompany  shall pay the  Executive  monthly  an amount  equal to (x)\nthe  quotient  of (A) the sum of (1) the  Executive's  annual  base\nsalary  at the rate in  effect  as of the Date of  Termination  and\n(2) the average of the annual  bonuses  earned by the  Executive in\nthe three fiscal years of the Company  ended  immediately  prior to\nthe Date of  Termination,  divided  by (B) the number  twelve  (12)\n(such   quotient   being  referred  to  herein  as  the  \"Severance\nPayments\"),  minus (y) any amounts payable to the Executive  during\nsuch month as a disability benefit under a Company paid plan.\n\n\n(b)   DEATH.  If the  Executive's  employment  is terminated by his\n      -----\ndeath,  the Company  shall pay to the person(s) or entity set forth\nin  Paragraph   11(b)  hereof  the  Accrued   Obligations  and  the\nSeverance  Payments at the time(s) set forth in Paragraphs  7(a)(i)\nand 7 (a)(ii) hereof.\n\n\n(c)   TERMINATION FOR CAUSE;  VOLUNTARY  TERMINATION  WITHOUT GOOD \n      ------------------------------------------------------------\nREASON.  If  the  Executive's   employment  is  terminated  by  the\n------\nCompany for Cause or  voluntarily  by the  Executive for other than\nGood Reason  (including by reason of the  expiration of the Term of\nthis  Agreement  as a result of a  Nonrenewal  Notice  having  been\ngiven  by  the  Executive),  the  Company  shall  pay  the  Accrued\nObligations   to  the   Executive  at  the  time(s)  set  forth  in\n\n================================================================================\n10\n\nParagraph  7(a)(i)  hereof  and the  Company  shall have no further\nobligations to the Executive under this Agreement.\n\n\n(d)   TERMINATION  WITHOUT  CAUSE;  TERMINATION  FOR GOOD REASON;  \n      -----------------------------------------------------------\nNONRENEWAL.  If (i) the Company  shall  terminate  the  Executive's\n----------\nemployment  other than for  Disability  pursuant to Paragraph  6(b)\nor for Cause,  (ii) the Executive  shall  terminate his  employment\nfor Good Reason,  or (iii) the Term of this Agreement  expires as a\nresult  of  a  Nonrenewal   Notice  having  been  provided  by  the\nCompany, then, subject to the provisions of Paragraph 9 hereof:\n\n\n(1)   the  Company  shall  pay  the  Accrued   Obligations  to  the\n      Executive  at the  time(s)  set  forth in  Paragraph  7(a)(i)\n      hereof;\n\n\n(2)   (A) unless clause (B) below applies,  then following the Date\n      of   Termination   and  for  the  longer  of  twelve   months\n      thereafter  or the  remaining  Term  of this  Agreement,  the\n      Company  shall pay to the  Executive  monthly an amount equal\n      to the Severance  Payments (as defined in Paragraph  7(a)(ii)\n      hereof),  or (B) in the event the Date of Termination  occurs\n      following  a Change in  Control,  then,  within five (5) days\n      after the Date of  Termination,  the Company shall pay to the\n      Executive  in a lump sum an amount  equal to the  product  of\n      (x) the sum of the  Executive's  base  salary  at the rate in\n      effect as of the Date of  Termination  and the average of the\n      annual  bonuses  earned by the  Executive in the three fiscal\n      years of the Company ended  immediately  prior to the Date of\n      Termination (or, if higher,  in the three fiscal years of the\n      Company  ended  immediately  prior to the Change in  Control)\n      multiplied  by (y) the number three (3). For purposes of this\n      subparagraph  (2):  (i) if the  Date  of  Termination  occurs\n      prior to the  occurrence  of a Change in  Control  but during\n      the   pendency   of  a   Potential   Change  in  Control  (as\n      hereinafter  defined),  such  Date of  Termination  shall  be\n      deemed to have  occurred  following  a Change in Control  and\n      (ii) a \"Potential  Change in Control\" shall be deemed to have\n      occurred  if the event set forth in any one of the  following\n      clauses shall have occurred:\n\n\n                (i)  the  Company  enters  into an  agreement,  the\n                     consummation  of  which  would  result  in the\n                     occurrence of a Change in Control;\n\n\n                (ii) the  Company  or any  Person  (as  defined  in\n                     Paragraph    6(d)(2)(A)    hereof)    publicly\n                     announces  an intention to take or to consider\n                     taking actions which,  if  consummated,  would\n                     constitute a Change in Control;\n\n\n                (iii)any Person  becomes the  beneficial  owner (as\n                     defined  in  Rule  13d-3  under  the  Exchange\n                     Act),  directly or  indirectly,  of securities\n                     of the  Company  representing  15% or  more of\n                     either the then  outstanding  shares of common\n                     stock of the  Company or the  combined  voting\n                     power  of  the  Company's   then   outstanding\n                     securities  (not  including in the  securities\n                     beneficially   owned   by  such   Person   any\n                     securities    acquired   directly   from   the\n                     Company); or\n\n\n                (iv) the Board  adopts a  resolution  to the effect\n                     that, for purposes of this  subparagraph  (2),\n                     a Potential Change in Control has occurred.\n================================================================================\n11\n\n      The  pendency  of  a  Potential   Change  in  Control   shall\n      immediately  cease upon the adoption of a  resolution  of the\n      Company's Board of Directors to that effect.\n\n\n(3)   the  Executive  shall  continue to be provided  with the same\n      medical and life  insurance  coverage as existed  immediately\n      prior to the  applicable  Notice of  Termination or Notice of\n      Nonrenewal,  as the case may be,  such  coverage  to continue\n      throughout  the period with respect to which the Executive is\n      entitled to receive Severance  Payments (or, if clause (B) of\n      Paragraph  7(d)(2)  applies,  for a period of three (3) years\n      following the Date of Termination);\n\n\n(4)   the Executive  shall be provided with  outplacement  services\n      commensurate with his position;\n\n\n(5)   the  Executive  shall be entitled to continue to exercise all\n      outstanding  options  that were or became  exercisable  as of\n      the  Date  of  Termination   until  the  90th  day  following\n      expiration  of the period with respect to which the Executive\n      is entitled to receive Severance  Payments (or, if clause (B)\n      of   Paragraph   7(d)(2)   applies,   following   the   third\n      anniversary  of the  Date of  Termination),  but in no  event\n      after expiration of the term of such options;\n\n\n(6)   any  unvested  stock  options  shall  become fully vested and\n      exercisable and any unvested  restricted  shares shall become\n      fully vested ; and\n\n\n(7)   the  Company  shall  pay the  Executive,  at the same time as\n      bonuses are paid to other  Company  executives,  a Bonus with\n      respect  to the  fiscal  year in  which  occurs  the  Date of\n      Termination,  such Bonus to be based upon actual  performance\n      for such  fiscal  year and pro rated to reflect the number of\n      days in such fiscal year  through and  including  the Date of\n      Termination.\n\n\n8.    GROSS-UP  PAYMENT.  In the event that any  payment or benefit\n      -----------------\nreceived or to be received by the  Executive in  connection  with a\nChange  in  Control  of  the  Company  or  the  termination  of the\nExecutive's  employment,  whether  such  payments or  benefits  are\nreceived  pursuant  to the  terms of this  Agreement  or any  other\nplan,  arrangement or agreement with the Company,  any person whose\nactions  result  in a  Change  in  Control  of the  Company  or any\nperson  affiliated  with  the  Company  or such  person  (all  such\npayments and benefits being hereinafter  called \"Total  Payments\"),\nwould be  subject  (in  whole  or  part),  to the tax (the  \"Excise\nTax\") imposed  under  Section 4999 of the Internal  Revenue Code of\n1986,  as  amended  (the  \"Code\"),  the  Company  shall  pay to the\nExecutive such additional  amounts (the \"Gross-Up  Payment\") as may\nbe  necessary  to  place  the  Executive  in  the  same   after-tax\nposition as if no portion of the Total  Payments  had been  subject\nto  the  Excise   Tax.   In  the  event  that  the  Excise  Tax  is\nsubsequently  determined  to be less  than the  amount  taken  into\naccount  hereunder,  the Executive  shall repay to the Company,  at\nthe  time  that the  amount  of such  reduction  in  Excise  Tax is\nfinally   determined,   the   portion  of  the   Gross-Up   Payment\nattributable  to the  reduction  (plus that portion of the Gross-Up\nPayment  attributable  to the  Excise  Tax and  federal,  state and\nlocal  income tax imposed on the Gross-Up  Payment  being repaid by\nthe  Executive  to the  extent  that such  repayment  results  in a\nreduction in Excise Tax and\/or  federal,  state or local income tax\ndeduction)  plus  interest on the amount of such  repayment  at the\nrate  provided in Section  1274(b)(2)(B)  of the Code. In the event\nthat the Excise Tax is  determined  to exceed the amount taken into\naccount   hereunder   (including  by  reason  of  any  payment  the\nexistence  of  which  cannot  be  determined  at  the  time  of the\nGross-Up  Payment,  the Company shall make an  additional  Gross-Up\nPayment in respect of such  excess  (plus any  interest,  penalties\n\n===============================================================================\n12\n\nor  additions  payable  by  the  Executive  with  respect  of  such\nexcess)  at the time  that the  amount of such  excess  if  finally\ndetermined.  The Executive  and the Company  shall each  reasonably\ncooperate with the other in connection with any  administrative  or\njudicial   proceedings   concerning  the  existence  or  amount  of\nliability for Excise Tax with respect to the Total Payments.\n\n\n9.    NONSOLICITATION; NONCOMPETE.\n      ----------------------------\n\n(a)   Subject  to (c)  below,  during  the  period  of  Executive's\nemployment,  during the period he is receiving  Severance  Payments\nhereunder  and,  in the case where the  Executive's  employment  is\nterminated  for  Cause  or  Executive  voluntarily  terminates  his\nemployment  without  Good  Reason,  for a  period  of  twelve  (12)\nmonths  following  such   termination,   the  Executive  shall  not\ninitiate  discussions  (of a  non-isolated  nature) with any person\nwho is then an executive  employee of the Company  (i.e.,  director\n                                                    ----\nlevel or above)  with the intent of  soliciting  or  inducing  such\nperson to leave his or her  employment  with a view toward  joining\nthe Executive in the pursuit of any business  activity  (whether or\nnot  such  activity   involves   engaging  or  participating  in  a\nCompetitive  Business  (as  defined  below)).  Notwithstanding  any\nother  provision of this  Agreement to the  contrary,  in the event\nExecutive fails to comply with the preceding  sentence,  all rights\nof the  Executive  and his  surviving  spouse or other  beneficiary\nhereunder  to any future  Severance  Payments and  continuing  life\ninsurance  and  medical  coverage  and all rights  with  respect to\nrestricted  stock  and  exercisability  of stock  options  shall be\nforfeited;  provided  that,  the foregoing  shall not apply if such\nfailure of  compliance  commences  following a Change in Control of\nthe Company.\n\n\n(b)   Subject  to  (c)  below,   as  long  as  Executive   receives\nSeverance   Payments,   or  in  the  case  where  the   Executive's\nemployment  is  terminated  for  Cause  or  Executive   voluntarily\nterminates  his  employment  without Good  Reason,  for a period of\ntwelve (12) months  following  such  termination,  Executive  shall\nnot,  without  the prior  written  consent  of the  Company  (which\nconsent   shall   not  be   unreasonably   withheld),   engage   or\nparticipate in any business which is \"in  competition\"  (as defined\nbelow)  with the  business of the Company or any of its 50% or more\nowned  affiliates  (such  business  being  referred  to herein as a\n\"Competitive  Business\").  Notwithstanding  any other  provision of\nthis  Agreement to the contrary,  in the event the Executive  fails\nto  comply  with  the  preceding   sentence,   all  rights  of  the\nExecutive and his surviving spouse or other  beneficiary  hereunder\nto any future  Severance  Payments and  continuing  life  insurance\nand  medical  coverage  and all rights with  respect to  restricted\nstock  and  exercisability  of stock  options  shall be  forfeited;\nprovided  that,  the  foregoing  shall not apply if such failure of\ncompliance commences following a Change in Control of the Company.\n\n\n(c)   In the  event  of a  violation  of  Paragraphs  9(a)  or 9(b)\nhereof,  the  remedies  of the  Company  shall be limited to (i) if\nsuch violation  occurs during the period of Executive's  employment\nhereunder,   termination   of  the  Executive  for  Cause  and  the\nassociated   rights  of  the  Company  specified  herein  resulting\ntherefrom,   (ii)   regardless  of  when  such  violation   occurs,\nforfeiture  by the  Executive  of the  payments  and  benefits  set\nforth  in  paragraphs  (a)  and  (b)  above  if and  to the  extent\nprovided  in  such   paragraphs,   and  (iii)  the  right  to  seek\ninjunctive  relief in  accordance  with and to the extent  provided\nin Paragraph 16 hereof;  provided,  such injunctive relief may only\nbe sought for  competitive  activity  under  Paragraph (b) above if\nsuch  activity  occurs  during   employment  or  after  Executive's\ndismissal  for  Cause  or  Executive  voluntarily   terminates  his\nemployment without Good Reason.\n\n\n(d)   For  purposes  hereof,  a business  will be \"in  competition\"\nwith  the  business  of the  Company  or  its  50%  or  more  owned\naffiliates  only if (i)  the  Company's  business  with  which  the\nother  business   competes   accounted  for  20%  or  more  of  the\nCompany's   consolidated  revenues  as  of  the  end  of  its  most\n\n================================================================================\n13\n\nrecently  completed  fiscal year prior to the Date of  Termination,\nand (ii) the entity  (including  all 50% or more owned  affiliates)\nthrough which the other  business is or will be operated  maintains\na \"woman's  apparel\"  business which generated at least $50 million\nin revenues  during the entity's  most  recently  completed  fiscal\nyear ended prior to the date the  Executive  commences (or proposes\nto commence) to engage or  participate in the other  business.  For\npurposes  hereof,  \"woman's  apparel\"  shall  consist  of  dresses,\njackets, pants, skirts,  blouses,  sweaters,  T-shirts,  outerwear,\nfootwear and accessories.\n\n\n(e)   Notwithstanding  the foregoing,  the Executive's  engaging in\nthe  following  activities  shall not be  construed  as engaging or\nparticipating in a Competitive  Business:  (i) investment  banking;\n(ii) passive  ownership of less than 2% of any class of  securities\nof  a  public   company;   (iii)  engaging  or   participating   in\nnoncompetitive  businesses  of an  entity  which  also  operates  a\nbusiness  which  is  \"in  competition\"  with  the  business  of the\nCompany or its affiliates;  (iv) serving as an outside  director of\nan entity  which  operates  a  business  which is \"in  competition\"\nwith the  business  of the  Company or its  affiliates,  so long as\nsuch  business did not account for 10% or more of the  consolidated\nrevenues  of  such  entity  as of  the  end of  its  most  recently\ncompleted  fiscal year prior to the date  Executive  commences  (or\nproposes to commence) serving as a outside  director;  (v) engaging\nin a  business  involving  licensing  arrangements  so long as such\nbusiness  is  not  an  in-house  arrangement  for  any  entity  \"in\ncompetition\"  with the  business of the Company or its  affiliates;\n(vi)  affiliation  with an  advertising  agency;  and  (vii)  after\ncessation  of  employment,   engaging  or   participating   in  the\n\"wholesale\"  side  of  the  woman's  apparel  business,  which  for\npurposes  hereof  shall mean the  design,  manufacture  and sale of\npiece  goods  and  woman's  apparel  to  unrelated  third  parties,\nprovided  that if the  entity  for which  Executive  so  engages or\nparticipates  (including  its  affiliates)  also  conducts a retail\nwoman's   apparel   business,   then  effective  upon   Executive's\nengaging or  participating  in such business,  all continuing  life\ninsurance  and  medical  coverage  provided  by the  Company  shall\ncease and all  Severance  Payments  shall cease  except for amounts\nrepresenting  the  excess  (if  any)  of  Executive's  annual  base\nsalary  hereunder  (at  the  rate  in  effect  as of  the  Date  of\nTermination)  over the  Executive's  base salary received from such\nentity and its  affiliates,  which  amounts  shall  continue  to be\npaid by the  Company for the  remainder  of the period in which the\nExecutive  is entitled  to receive  Severance  Payments  hereunder.\nThe   exceptions   contained  in   subparagraph   (vii)  above  and\nsubparagraph  (iii)  above to the extent  covered  by  subparagraph\n(vii)  shall  not  be  applicable  if   Executive's   cessation  of\nemployment  is voluntary  by Executive  without Good Reason and his\nnew engagement or  participation  involves  \"wholesale\"  operations\nwhich  include or also  conduct  retail  sales of  woman's  apparel\nother than factory  outlet or discount  stores to liquidate  unsold\nwoman's apparel of such wholesale operations.\n\n\n10.   PROTECTION OF CONFIDENTIAL INFORMATION.\n      ---------------------------------------\n\n(a)   Executive  acknowledges  that his  employment  by the Company\nwill,   throughout  the  Term  of  this   Agreement,   involve  his\nobtaining  knowledge  of  confidential  information  regarding  the\nbusiness  and  affairs  of  the  Company.  In  recognition  of  the\nforegoing, the Executive covenants and agrees that:\n\n\n(i)   except in compliance with legal process,  he will keep secret\nall  confidential  matters of the Company  which are not  otherwise\nin the public  domain and will not  intentionally  disclose them to\nanyone  outside of the Company,  wherever  located (other than to a\nperson to whom  disclosure is reasonably  necessary or  appropriate\nin connection  with the  performance  by Executive of his duties as\nan executive  officer of the  Company),  either during or after the\n\n================================================================================\n14\n\n\nTerm,  except  with the  prior  written  consent  of the Board or a\nperson authorized thereby; and\n\n\n\n      (ii) he will deliver promptly to the Company on termination of his\nemployment, or at any other time the Company may so request, all memoranda,\nnotes, records, customer lists, reports and other documents (and all copies\nthereof)  relating to the business of the Company  which he obtained  while\nemployed by, or  otherwise  serving or acting on behalf of, the Company and\nwhich he may then possess or have under his control.\n\n\n\n      (b)  Notwithstanding the provisions of Paragraph 16 of this Agreement,\nif the Executive commits a breach of the provisions of Paragraphs  10(a)(i)\nor  10(a)(ii),  the  Company  shall  have the right and remedy to have such\nprovisions  specifically  enforced by any court having equity jurisdiction,\nit being  acknowledged and agreed that any such breach or threatened breach\nwill cause  irreparable  injury to the Company and that money  damages will\nnot provide an adequate remedy to the Company.\n\n\n11.   SUCCESSORS; BINDING AGREEMENT.\n      -----------------------------\n\n      (a)   Neither this Agreement nor any rights hereunder shall be\nassignable or otherwise  subject to  hypothecation by the Executive\n(except  by  will  or  by   operation  of  the  laws  of  intestate\nsuccession)  or by  the  Company,  except  that  the  Company  will\nrequire any  successor  (whether  direct or indirect,  by purchase,\nmerger,  consolidation  or otherwise) to all or  substantially  all\nof the  business  and\/or  assets of the  Company,  by  agreement in\nform and substance  reasonably  satisfactory  to the Executive,  to\nexpressly  assume and agree to perform  this  Agreement in the same\nmanner and to the same extent  that the  Company  would be required\nto perform it if no such  succession  had taken  place.  Failure of\nthe Company to obtain such  assumption  and agreement  prior to the\neffectiveness  of any such  succession  shall  be a breach  of this\nAgreement  and shall  entitle the  Executive to  compensation  from\nthe  Company  in the same  amount and on the same terms as he would\nbe entitled to hereunder if he terminated  his  employment for Good\nReason,  except that for purposes of  implementing  the  foregoing,\nthe date on which any such  succession  becomes  effective shall be\ndeemed  the  Date  of  Termination.  As  used  in  this  Agreement,\n\"Company\"  shall mean the Company as herein before  defined and any\nsuccessor  to  its  business   and\/or  assets  as  aforesaid  which\nexecutes  and  delivers   the   agreement   provided  for  in  this\nParagraph  11 or which  otherwise  becomes  bound by all the  terms\nand provisions of this Agreement by operation of law.\n\n\n       (b)   This Agreement and all rights of the Executive hereunder\nshall  inure  to  the  benefit  of  and  be   enforceable   by  the\nExecutive's   personal   or   legal   representatives,   executors,\nadministrators,   successors,   heirs,  distributes,   devises  and\nlegatees.  If the  Executive  should  die while any  amounts  would\nstill be  payable to him  hereunder  if he had  continued  to live,\nall such amounts,  unless otherwise provided herein,  shall be paid\nin accordance  with the terms of this Agreement to the  Executive's\ndevisee,  legatee,  or  other  designee  or,  if  there  be no such\ndesignee, to the Executive's estate.\n\n\n12.   NOTICE. For the purposes of this Agreement,  notices, demands\n      ------\nand all other  communications  provided for in this Agreement shall\nbe in  writing  and shall be deemed  to have been duly  given  when\npersonally  delivered to the  Executive or an executive  officer of\nthe  Company,  mailed  by United  States  certified  or  registered\nmail, return receipt  requested,  postage prepaid,  or by overnight\ncourier service, to the address as follows:\n\n\n      If to the Company:\n\n================================================================================\n15\n\n\n           AnnTaylor Stores Corporation\n           142 West 57th Street\n           New York, New York  10019\n           Attn: General Counsel\n\n\n      If to the Executive:\n           J. Patrick Spainhour\n           114 Scarlet Drive\n           Columbus, Mississippi  39701\n\n\nor to such  other  address as any party may have  furnished  to the\nother in writing in  accordance  herewith,  except that  notices of\nchange of address shall be effective only upon receipt.\n\n\n13.   MISCELLANEOUS.   No  provisions  of  this  Agreement  may  be\n      \nmodified,  waived or  discharged  unless such waiver,  modification\nor  discharge  is agreed to in a  writing  signed by the  Executive\nand such officer of the Company as may be  specifically  designated\nby the Board.  No waiver by either  party hereto at any time of any\nbreach by the  other  party  hereto  of, or  compliance  with,  any\ncondition or  provision  of this  Agreement to be performed by such\nother  party  shall be deemed a waiver  of  similar  or  dissimilar\nprovisions   or   conditions  at  the  same  or  at  any  prior  or\nsubsequent  time.  No  agreements  or   representations,   oral  or\notherwise,  express or implied,  with respect to the subject matter\nhereof  have  been  made by  either  party  which are not set forth\nexpressly  in  this   Agreement.   The  validity,   interpretation,\nconstruction  and  performance of this Agreement  shall be governed\nby the  laws  of  the  State  of New  York  without  regard  to its\nconflicts of law principles.\n\n\n\n14.   VALIDITY.   The   invalidity  or   unenforceability   of  any\n      --------\nprovision  or  provisions  of this  Agreement  shall not affect the\nvalidity  or   enforceability   of  any  other  provision  of  this\nAgreement, which shall remain in full force and effect.\n\n\n\n15.   COUNTERPARTS.  This  Agreement may be executed in one or more\n      ------------\ncounterparts  and by  facsimile  signature  each of which  shall be\ndeemed  to  be  an  original  but  all  of  which   together   will\nconstitute one and the same instrument.\n\n\n\n16.   ARBITRATION.  Any dispute or controversy  arising under or in\n      -----------\nconnection  with this  Agreement  shall be settled  exclusively  by\narbitration  conducted  before a panel of three  arbitrators in New\nYork  City  in   accordance   with  the   rules  of  the   American\nArbitration  Association  then in effect.  Judgment  may be entered\non  the  arbitrator's  award  in  any  court  having  jurisdiction;\nprovided   that,   the   Company   shall  be  entitled  to  seek  a\nrestraining   order  or   injunction  in  any  court  of  competent\njurisdiction  to prevent any  continuation  of any violation of the\nprovisions  of  Paragraph 9 of the  Agreement  during the period of\nExecutive's  employment  or following  Executive's  termination  of\nemployment  for Cause or the  voluntary  termination  of employment\nby  Executive  without  Good  Reason  or of  Paragraph  10 of  this\nAgreement  at any time,  and the  Executive  hereby  consents  that\nsuch  restraining  order or injunction  may be granted  without the\nnecessity of the Company's  posting any bond; and further  provided\nthat,   the   Executive   shall  be  entitled   to  seek   specific\nperformance  of his right to be paid until the Date of  Termination\nduring the  pendency of any dispute or  controversy  arising  under\nor in  connection  with  this  Agreement.  The  Company  shall  pay\ndirectly or reimburse  the  Executive  for any legal fees  incurred\nby  Executive in  connection  with any  arbitration  related to the\nlast proviso of the  preceding  sentence and any other  arbitration\nin which he prevails.\n\n================================================================================\n16\n\n17.   ENTIRE  AGREEMENT.  This  Agreement  sets  forth  the  entire\n      -----------------\nagreement  of the parties  hereto in respect of the subject  matter\ncontained   herein  and   supersedes   any  and  all  other   prior\nagreements,  promises,  covenants,  arrangements,   communications,\nrepresentations  or  warranties,  whether  oral or written,  by any\nofficer,   employee  or   representative   of  any  party   hereto,\nincluding,  without limitation,  the Employment  Agreement dated as\nof February 16, 1996, as amended.\n\n\n      IN WITNESS WHEREOF,  the parties have executed this Agreement\nas of the date and year first above written.\n\n\n\n                          ANNTAYLOR STORES CORPORATION\n\n\n\n                          By:    \/s\/ Robert C. Grayson\n                                 ____________________________________\n\n                          Name:      Robert C. Grayson\n                          Title: Chairman AnnTaylor Stores Corporation\n                                     Compensation Committee\n\n\n\n\n\n                          EXECUTIVE\n\n                                    \/s\/ J. Patrick Spainhour\n                          ____________________________________\n                                        J. Patrick Spainhour\n\n\n \n\n                          March 5, 2002\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6710],"corporate_contracts_industries":[9494],"corporate_contracts_types":[9539,9544],"class_list":["post-38932","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-anntaylor-stores-corp","corporate_contracts_industries-retail__clothing","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38932","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38932"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38932"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38932"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38932"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}