Employment Agreement - J Crew Group Inc., TPG Partners II LP and Emily Woods
EMPLOYMENT AGREEMENT
AGREEMENT, dated this 17th day of October, 1997 (the
"Agreement"), among J. Crew Group, Inc., a New York Corporation
(the "Parent") and its operating subsidiary J. Crew Operating
Corp. (the "Subsidiary" and collectively with the Parent, the
"Employer"), with offices at 625 Sixth Avenue, New York, New
York, TPG Partners II, L.P. ("TPG II") (only with respect to
Section 2(c) herein) and Emily Woods (the "Employee").
1. Employment, Duties and Agreements.
(a) The Employer hereby agrees to cause the Employee to
be elected as Chairman of the Board of Directors of the Parent and
to employ the Employee as Chief Executive Officer of the Parent
and the Subsidiary and the Employee hereby accepts such positions
and agrees to serve the Parent and the Subsidiary in such
capacities during the employment period fixed by Section 3 hereof
(the "Employment Period"). The Employee acknowledges that the
title of Chief Executive Officer of the Parent and the Subsidiary
may be given to another officer assuming a business/operations
role if the Board of Directors of the Parent (the "Board")
determines in its sole discretion that such action is necessary
to recruit such other officer; provided that such other officer,
as Chief Executive Officer, shall report to a committee of the
Board consisting of no more than three members of which the
Employee is the chairman, and the Employee and the Board shall
from time to time mutually agree on the reporting relationships
of any other senior officer of the Employer or any of its
subsidiaries. The Employee shall report solely and directly to
the Board. The Employee's duties and responsibilities shall be
such duties and responsibilities as the Board may reasonably
determine from time to time that are consistent with the above
job titles. During the Employment Period, the Employee shall be
subject to, and shall act in accordance with, all reasonable
instructions and directions of the Board and all applicable
policies and rules thereof as are consistent with the above job
titles.
(b) During the Employment Period and as long as the
Employer shall not be in default of a material obligation
hereunder, excluding any periods of vacation and sick leave to
which the Employee is entitled, the Employee shall devote
substantially all of her working time, energy and attention to
the performance of her duties and responsibilities hereunder and
shall faithfully and diligently endeavor to promote the business
and best interests of the Employer.
(c) During the Employment Period and so long as the
Employer shall not be in default of a material obligation
hereunder, the Employee may not, without the prior written
consent of the Employer, operate, participate in the management,
operations or control of, or act as an employee, officer,
consultant, agent or representative of, any type of business or
service (other than as an employee of the Employer), provided
that it shall not be a violation of the foregoing for the
Employee to (i) act or serve as a director, trustee, committee
member or principal of any type of business or civic or
charitable organization (including, without limitation, acting as
a producer or executive producer of motion picture productions)
and (ii) manage her personal, financial and legal affairs, so
long as such activities (described in clauses
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(i) and (ii)) do not interfere with the performance of her duties
and responsibilities to the Employer as provided hereunder.
2. Compensation.
(a) As compensation for the agreements made by the
Employee herein and the performance by the Employee of her
obligations hereunder, during the Employment Period, the Employer
shall pay the Employee, not less than once a month pursuant to
the Employer's normal and customary payroll procedures, a base
salary at the rate of $1,000,000 per annum (the "Base Salary").
The amount of the Base Salary shall be increased on each
anniversary of the Effective Date during the Employment Period,
to reflect the year-to-year increase, if any, as of the July 1
immediately preceding such Effective Date in the U.S. Consumer
Price Index for All Urban Consumers, U.S. City Average, All
Items, Unadjusted, as published by the U.S. Department of Labor,
or in the absence of that index, the most comparable index then
published and may be increased further in the absolute discretion
of the Compensation Committee of the Board.
(b) In addition to the Base Salary, during the Employment
Period the Employee shall have an opportunity to earn an annual
bonus (the "Bonus") in accordance with the terms of the J. Crew
Operating Corp. Senior Executive Bonus Plan attached hereto as
Exhibit A.
(c) As of the Effective Date (as defined in Section 3
below), TPG II hereby grants to the Employee the option to
purchase from TPG II shares of common stock of J. Crew Group,
Inc. (the "Common Stock") equal to ten percent (10%) (the "10%
Option") of the total outstanding shares of Common Stock
determined immediately after the closing (the "Closing") of the
transactions contemplated by the Recapitalization Agreement,
dated July 22, 1997, among TPG II, J. Crew Group, Inc. and
certain other persons (the "Recapitalization") at the same price
per share of Common Stock as TPG II paid per share of Common
Stock pursuant to the Recapitalization (the "TPG II Price"). Upon
the exercise by the Employee of the 10% Option, the Employee
shall be required to purchase from TPG II an amount of preferred
stock of the Parent, at the same price and on the same terms as
TPG II's purchase of preferred stock, the aggregate purchase
price for which bears the same ratio to the aggregate purchase
price paid by the Employee for Common Stock pursuant to the
exercise of the 10% Option as the ratio of the aggregate purchase
price paid by TPG II for the purchase of preferred stock bears to
the aggregate purchase price paid by TPG II for the Common Stock
in connection with the Recapitalization. The 10% Option provided
in this Section 3(c) shall expire at the close of business on the
thirtieth day after the Closing.
(d) On January 1, 1998, the Employer shall grant the
Employee 2915 restricted shares of Common Stock (the "Restricted
Shares") and 393 shares of Common Stock (the "Additional
Shares"). Such Additional Shares shall not be subject to the
restrictions provided in this Section 2(d). The Restricted Shares
shall vest as follows: 972 Restricted Shares on each of the third
and fourth anniversaries of the Closing and 971 on the fifth
anniversary of the Closing, provided that the Employee is still
employed by the Employer on such date. Notwithstanding the
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foregoing, to the extent not yet granted, the Employer shall
immediately grant the Restricted Shares and the Additional
Shares, and all or any portion of the Restricted Shares not
previously forfeited shall vest immediately upon the occurrence
of a Change in Control (as defined in the J. Crew Group, Inc.
1997 Stock Option Plan) or the termination of the Employment
Period by the Employer without Cause, by the Employee for Good
Reason, or by reason of the Employee's death or Disability. If
the Employment Period terminates for any other reason, the
Restricted Shares which have not vested on such date of
termination shall be forfeited by the Employee and returned to
the Employer. Notwithstanding anything to the contrary in the
Stockholders' Agreement, the certificates representing the
Restricted Shares shall be held in custody by the Employer until
the vesting thereof and shall not be transferred until such
shares become vested as provided herein. All cash, securities and
other property paid or otherwise distributed with respect to the
Restricted Shares which have not vested shall be held in custody
by the Employer and shall be subject to the same vesting,
forfeiture and distribution rules described above with respect to
the Restricted Shares related thereto. In addition, the Employee
shall be entitled to direct the Employer as to the manner in
which the Restricted Shares held in custody by the Employer shall
be voted.
(e) In connection with the grant of the Restricted
Shares, the Employee shall make an election prior to January 30,
1998 to include in gross income on the date of the grant the
value of the Restricted Shares on such date pursuant to Section
83(b) (the "Section 83(b) Election") of the Internal Revenue Code
of 1986, as amended. Upon notification from the Employee that the
Section 83(b) Election has been made, the Employer shall pay the
appropriate depository an amount equal to the Employee's federal,
state and local income and payroll tax withholding obligations
with respect to (i) the value of the Restricted Shares (the
"Restricted Share Value"), which value shall be equal to the TPG
II Price unless otherwise mutually agreed by the parties, (ii)
the value of the Additional Shares (the "Additional Share
Value"), which value shall be equal to the TPG II Price unless
otherwise mutually agreed by the parties and (iii) the income
required to be recognized by the Employee as a result of the
payment by the Employer of such withholding obligations, in each
case based on withholding rates determined by the Employer in its
discretion and in compliance with applicable law (such sum paid
by the Employer hereinafter referred to as the "Withholding
Amount"). At least thirty days before the Employee's due date for
1998 Federal income taxes, the Employee shall provide a
certificate to the Employer in which the Employee shall represent
to the Employer the Employee's highest marginal income tax rate
applicable to her actual income with respect to each of her
federal, state and local income taxes for 1998. The "Stock
Gross-Up Payment" shall be determined by an accounting firm
mutually agreed upon by the parties (whose expenses will be paid
by the Employer) and shall equal an amount such that, after
payment of all federal, state and local income and payroll taxes
("Taxes") on the Stock Gross-Up Payment, the Employee will retain
an amount sufficient to pay all Taxes that she is required to pay
as a result of the grant of the Restricted Shares, the Section
83(b) Election and the grant of Additional Shares. The
calculation of the amount of the Stock Gross-Up Payment shall (i)
take into account any marginal deduction with respect to the
Employee's Federal income tax liability for state and local
income taxes paid with respect to the grant of Restricted Shares,
Additional Shares and the Stock Gross-Up
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Payment to which the Employee will be entitled, and (ii)
notwithstanding the time of year in which any payments are made
hereunder by the Employer, be based on payroll taxes on income in
excess of $100,000. The determination of the accounting firm
shall be final and binding upon the Employee and the Employer.
After the accounting firm notifies the Employer of the amount of
the Stock Gross-Up Payment and no later than fifteen days prior
to the Employee's due date for her 1998 Federal income taxes, the
Employer shall pay the Employee the excess, if any, of the Stock
Gross-Up Payment over the Withholding Amount or the Employee
shall pay the Employer the excess, if any, of the Withholding
Amount over the Stock Gross-Up Payment, as applicable. The
Withholding Amount and the Stock Gross-Up Payment, if any, shall
be paid by the Employer notwithstanding any termination of the
Employee's employment hereunder.
(f) All shares of Common Stock and preferred stock of
J. Crew Group, Inc. and all other securities issued in connection
with the Recapitalization and acquired by the Employee under this
Agreement or otherwise shall be subject to the Stockholders'
Agreement attached hereto as Exhibit B.
(g) During the Employment Period, the Employee shall
be entitled to the following expense reimbursement and additional
benefits and perquisites:
(i) reimbursement of travel expenses (with regard
to air travel, on the Concorde where available or otherwise in
first class), including with spouse where appropriate and as
reasonably agreed between the Employer and the Employee;
(ii) cellular and home business telephone lines;
(iii) a leased car, including a driver as needed
by the Employee;
(iv) reimbursement of reasonable tax, investment
management and legal services fees;
(v) reimbursement of entertainment expenses which
are reasonably expected to benefit the Employer;
(vi) the provision of J. Crew Brand clothing
(including for the Employee's spouse); and
(vii) an additional payment (a "Reimbursement
Gross-Up Payment") relating to the federal, state and local
income and payroll taxes incurred by the Employee with respect to
amounts required to be recognized as income for Federal income
tax purposes by the Employee as a result of reimbursements
provided in clauses (i) through (vi) of this Section 2(g) (the
"Gross-Up Expenses"). The amount of Gross-Up Expenses shall be
determined by an accounting firm mutually agreed upon by the
Employee and the Employer (and whose expenses will be paid by the
Employer) and shall reflect that firm's determination of the
amount that should be includible in income by the Employee with
respect to clauses (i) through (vi) of this
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Section 2(g). At least thirty days before the Employee's due date
for her Federal income taxes with respect to each calendar year,
the Employee shall provide a certificate to the Employer in which
the Employee shall represent to the Employer the highest marginal
income tax rate applicable to her actual income with respect to
each of her federal, state and local income taxes for such year.
The "Reimbursement Gross-Up Payment" for each calendar year shall
be determined by an accounting firm mutually agreed upon by the
parties (whose expenses will be paid by the Employer) and shall
equal an amount such that, after payment of all Taxes on the
Reimbursement Gross-Up Payment, the Employee will retain an
amount sufficient to pay all Taxes that she is required to pay as
a result of the reimbursement of the Gross-Up Expenses. The
calculation of the amount of the Reimbursement Gross-Up Payment
shall (i) take into account any marginal deduction with respect
to the Employee's Federal income tax liability for state and
local income taxes paid with respect to the Gross-Up Expenses to
which the Employee will be entitled, and (ii) notwithstanding the
time of year in which any payments are made hereunder by the
Employer, be based on payroll taxes on income in excess of
$100,000. The determination of the accounting firm shall be final
and binding upon the Employee and the Employer. After the
accounting firm notifies the Employer of the amount of the
Reimbursement Gross-Up Payment and no later than fifteen days
prior to the Employee's due date for paying her Federal income
taxes for such year, the Employer shall pay the Employee the
Reimbursement Gross-Up Payment. The Reimbursement Gross-Up
Payment shall be paid by the Employer notwithstanding any
termination of the Employee's employment hereunder.
(h) During the Employment Period: (i) the Employee
shall be entitled to participate in all savings and retirement
plans, practices, policies and programs of the Employer and its
affiliated companies which are made available generally to other
executive officers of the Employer and its affiliated companies
(for the avoidance of doubt, such savings and retirement plans,
practices, policies and programs shall exclude any incentive
compensation plan, practice, policy or program, including without
limitation equity-based compensation and cash bonus plans); and
(ii) the Employee and/or the Employee's family, as the case may
be, shall be eligible for participation in, and shall receive all
benefits under, all welfare benefit plans, practices, policies
and programs provided by the Employer and its affiliated
companies (including, without limitation, medical, prescription,
dental, disability, the Employee life insurance, group life
insurance, accidental death and travel accident insurance plans
and programs) which are made available generally to other
executive officers of the Employer and its affiliated companies
(for the avoidance of doubt, such plans, practices, policies or
programs shall not include any plan, practice, policy or program
which provides benefits in the nature of severance or
continuation pay). Without limiting the generality of the
foregoing, the Employer shall review its executive disability
insurance program with the Employee, with the goal of providing
the Employee with a long-term disability benefit equal to
two-thirds of the Employee's base salary in the event of
permanent disability to the extent such insurance is reasonably
available in the market (it being understood that the Employer
will use its reasonable efforts to purchase such a disability
policy). The term "affiliated companies" means all companies
controlled by, controlling or under common control with the
Employer.
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(i) During the Employment Period, the Employee shall
be entitled to paid vacation of at least five weeks per year. The
ability to carry forward vacation time shall be subject to the
Employer's vacation policy applicable generally to executive
officers of the Employer as in effect from time to time.
(j) The Employer shall promptly reimburse the Employee
for all reasonable business expenses upon the presentation of
statements of such expenses in accordance with the Employer's
policies and procedures now in force or as such policies and
procedures may be modified with respect to all senior executive
officers of the Employer.
(k) During the Employment Period, the Employer shall
furnish the Employee with office space, stenographic and
secretarial assistance and such other incidental facilities and
services as provided to the Employee immediately prior to the
date hereof, provided that such services are substantially
related to the Employee's employment hereunder.
3. Employment Period.
The Employment Period shall commence on the date of
the Closing (the "Effective Date") and shall terminate on the day
preceding the fifth anniversary of the Effective Date (the
"Scheduled Termination Date"); provided, however, that the
Employee's employment hereunder may be terminated during the
Employment Period prior to the Scheduled Termination Date upon
the earliest to occur of the following events (at which time the
Employment Period shall be terminated):
(a) Death. The Employee's employment hereunder shall
terminate upon her death.
(b) Disability. The Employer shall be entitled to
terminate the Employee's employment hereunder for "Disability"
if, as a result of the Employee's incapacity due to physical or
mental illness, the Employee shall have been unable to perform
her duties hereunder for a period of six (6) consecutive months
or for 180 days within any 365-day period, and within 30 days
after written Notice of Termination for Disability is given
following such 6-month or 180-day period, as the case may be, the
Employee shall not have returned to the performance of her duties
on a full-time basis.
(c) Cause. The Employer may terminate the Employee's
employment hereunder for Cause. For purposes of this Agreement,
the term "Cause" shall mean: (1) the willful and continued
failure of the Employee substantially to perform the Employee's
duties under this Agreement (other than as a result of physical
or mental illness or injury), after the Board delivers to the
Employee a written demand for substantial performance that
specifically identifies the manner in which the Board believes
that the Employee has not substantially performed the Employee's
duties; and (2) the willful engaging by the Employee in illegal
conduct or gross misconduct which is materially and demonstrably
injurious to the Employer. Any act or failure to act that is
based upon authority given pursuant to a resolution duly adopted
by the Board, or
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the advice of counsel for the Employer, shall not constitute
Cause. Cause shall not exist unless and until the Employer has
delivered to the Employee a copy of a resolution duly adopted by
a majority of the Board at a meeting of the Board called and held
for such purpose (after reasonable but in no event less than
thirty (30) days' notice to the Employee and an opportunity for
the Employee, together with her counsel, to be heard before the
Board), finding that, in the good faith opinion of the Board, the
Employee was guilty of the conduct set forth above and specifying
the particulars thereof in detail. This Section 3(c) shall not
prevent the Employee from challenging in any court of competent
jurisdiction the Board's determination that Cause exists or that
the Employee has failed to cure any act (or failure to act) that
purportedly formed the basis for the Board's determination.
(d) Good Reason. The Employee may terminate her
employment hereunder for "Good Reason," for any of the following
reasons enumerated in this Section 3(d) (and such termination
shall be treated as if it were a termination by the Employer
without Cause, and not a voluntary termination by the Employee):
(1) the assignment to the Employee of any duties inconsistent
with paragraph (a) of Section 1 of this Agreement, or any other
action by the Employer that results in a diminution in the
Employee's position, authority, duties or responsibilities; (2)
any purported termination of the Employee's employment by the
Employer for a reason or in a manner not expressly permitted by
this Agreement; or (3) any failure by the Employer to comply with
Sections 2(a) through 2(e) and Section 12(d)(ii) of this
Agreement, or any other material breach of this Agreement.
Termination by the Employee pursuant to this Section 3(d) shall
not be effective until the Employee delivers to the Board a
written notice specifically identifying the conduct of the
Employer which the Employee believes constitutes a reason
enumerated in this Section 3(d) and the Employee provides the
Board at least thirty (30) days to remedy such conduct.
(e) Without Cause. The Employer may terminate the
Employee's employment hereunder without Cause.
(f) Without Good Reason. The Employee may terminate
her employment hereunder without Good Reason, provided that the
Employee provides the Employer with notice of her intent to
terminate without Good Reason at least three months in advance of
the Date of Termination (as defined in Section 4 below). The
Employee and the Employer shall mutually agree on the time,
method and content of any public announcement regarding the
Employee's termination of employment hereunder and neither the
Employee nor the Employer shall make any public statements which
are inconsistent with the information mutually agreed upon by the
Employer and the Employee and the parties hereto shall cooperate
with each other in refuting any public statements made by other
persons, which are inconsistent with the information mutually
agreed upon between the Employee and Employer as described above.
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4. Termination Procedure.
(a) Notice of Termination. Any termination of the
Employee's employment by the Employer or by the Employee during
the Employment Period (other than termination pursuant to Section
3(a)) shall be communicated by written "Notice of Termination" to
the other party hereto in accordance with Section 12(a). For
purposes of this Agreement, a Notice of Termination shall mean a
notice which shall indicate the specific termination provision in
this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for
termination of the Employee's employment under the provision so
indicated and shall attach any prior notices required under
Section 3.
(b) Date of Termination. "Date of Termination" shall
mean (i) if the Employee's employment is terminated by her death,
the date of her death, (ii) if the Employee's employment is
terminated pursuant to Section 3(b), thirty (30) days after
Notice of Termination (provided that the Employee shall not have
returned to the substantial performance of her duties on a
full-time basis during such thirty (30) day period), (iii) if the
Employee's employment is terminated pursuant to Section 3(f), a
date specified in the Notice of Termination which is at least
three months from the date of such notice as specified in such
Section 3(f); and if the Employee's employment is terminated for
any other reason, the date on which a Notice of Termination is
given or any later date (within thirty (30) days (or any
alternative time period agreed upon by the parties) after the
giving of such notice) set forth in such Notice of Termination.
5. Termination Payments.
(a) Without Cause or for Good Reason. In the event of
the termination of the Employee's employment during the
Employment Period, by the Employer without Cause or by the
Employee for Good Reason, the Employee shall be entitled to a
payment, within ten (10) days following the Date of Termination,
of the Employee's Base Salary through the Date of Termination (to
the extent not theretofore paid), any accrued vacation pay, and
any unreimbursed expenses under Section 2(h) (the "Accrued
Obligations"), and to the continued payment of the Employee's
Base Salary through the Scheduled Termination Date. The Employee
shall also be entitled to payment of any earned but unpaid Bonus
in respect of a Bonus Period ending prior to or coincident with
the Date of Termination and a pro-rata Bonus determined pursuant
to Section 3 of the Senior Executive Bonus Plan attached hereto
as Exhibit A, and paid in accordance with such Bonus Plan. In
addition, the Employee (and her spouse and dependents) shall be
entitled to continued health and welfare insurance coverage at
the levels provided in Section 2(h)(ii) until the earlier to
occur of (i) the Scheduled Termination Date or (ii) the date the
Employee becomes eligible for substantially similar benefits from
a subsequent employer. The Employer shall have no additional
obligations under this Agreement (other than as may be provided
under Sections 9 or 10 hereof).
(b) Cause, Death, Disability or Without Good Reason.
If the Employee's employment is terminated during the Employment
Period by the Employer for Cause, by the
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Employee without Good Reason, or as a result of the Employee's
death or Disability, the Employer shall pay the Accrued
Obligations to the Employee or the Employee's estate or legal
representative in the event of her death within thirty (30) days
following the Date of Termination. The Employee shall also be
entitled to any earned but unpaid Bonus in respect of a Bonus
Period ending prior to or coincident with the Date of Termination
determined pursuant to section 3 of the Senior Executive Bonus
Plan attached hereto as Exhibit A, and paid in accordance with
such Bonus Plan. The Employer shall have no additional
obligations under this Agreement (other than as may be provided
under Sections 9 or 10 hereof).
6. Non-exclusivity of Rights.
Any vested benefits and other amounts that the
Employee is otherwise entitled to receive under any employee
benefit plan, policy, practice or program of the Employer or any
of its affiliated companies shall be payable in accordance with
such employee benefit plan, policy, practice or program as the
case may be, except as explicitly modified by this Agreement.
7. Full Settlement; No Duty to Mitigate.
The Employer's obligation to make the payments
provided for in, and otherwise to perform its obligations under,
this Agreement shall not be affected by any set off,
counterclaim, recoupment, defense or other claim, right or action
that the Employer may have against the Employee or others;
provided that this provision shall not apply with respect to any
debt owed by the Employee to the Employer or any of its
affiliates and shall not apply in the event the Employee's
employment is terminated by the Employer for Cause under
circumstances which may reasonably be expected to result in an
economic loss to the Employer.
In no event shall the Employee be obligated to seek
other employment or take any other action by way of mitigation of
the amounts payable to the Employee under any of the provisions
of this Agreement, and such amounts shall not be reduced,
regardless of whether the Employee obtains other employment,
except as provided in Section 5(a) herein.
8. Transactions with Affiliates.
During the Employment Period, the Employer shall not
engage in any transaction with an affiliate of TPG II without the
consent of the Employee. The Employee's consent shall not be
unreasonably withheld with respect to any proposed transaction
which is on a commercially reasonable arm's length basis.
9. Legal Fees.
(a) The Employer shall reimburse the Employee for
reasonable attorneys' fees and expenses and other reasonable fees
incurred in connection with the preparation of this Agreement not
to exceed $200,000.
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(b) In the event of any contest or dispute between the
Employer and the Employee with respect to this Agreement or the
Employee's employment hereunder, each of the parties shall be
responsible for their respective legal fees and expenses.
10. Indemnification.
(a) General. The Employer agrees that if the Employee
is made a party or threatened to be made a party to any action,
suit or proceeding, whether civil, criminal, administrative or
investigative (a "Proceeding"), other than any Proceeding related
to any contest or dispute between the Employee and the Employer
or any of its affiliates with respect to this Agreement or the
Employee's employment hereunder, by reason of the fact that the
Employee is or was a director or officer of the Employer, or any
subsidiary of the Employer or is or was serving at the request of
the Employer, as a director, officer, member, employee or agent
of another corporation or a partnership, joint venture, trust or
other enterprise, the Employee shall be indemnified and held
harmless by the Employer to the fullest extent authorized by New
York law. This Section 10(a) shall survive the termination of the
Employment Period.
(b) Expenses. As used in this Section 10 the term
"Expenses" shall include, without limitation, damages, losses,
judgments, liabilities, fines, penalties, excise taxes,
settlements, and costs, attorneys' fees, accountant's fees, and
disbursements and costs of attachment or similar bonds,
investigations, and any expenses of establishing a right to
indemnification under this Agreement.
11. Non-Solicitation.
(a) So long as the Employer is not in default of a
material obligation hereunder, the Employee agrees not to offer
employment to any employee of the Employer or any of its
affiliates or attempt to induce any such employee to leave the
employ of the Employer or any subsidiaries of the Employer prior
to the second anniversary of the Date of Termination.
(b) The parties hereto hereby declare that it is
impossible to measure in money the damages which will accrue to
the Employer by reason of a failure by the Employee to perform
any of her obligations under this Section 11. Accordingly, if the
Employer institutes any action or proceeding to enforce the
provisions hereof, to the extent permitted by applicable law, the
Employee hereby waives the claim or defense that the Employer has
an adequate remedy at law, and the Employee shall not urge in any
such action or proceeding the defense that any such remedy exists
at law. This Section 11 shall survive the termination of the
Employment Period.
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12. Miscellaneous.
(a) Any notice or other communication required or
permitted under this Agreement shall be effective only if it is
in writing and delivered personally or sent by registered or
certified mail, postage prepaid, addressed as follows (or if it
is sent through any other method agreed upon by the parties):
If to the Employer:
J. Crew Group, Inc.
625 Sixth Avenue
Third Floor
New York, NY 10011
Attention: Board of Directors and Secretary
with a copy to:
Paul Shim, Esq.
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, NY 10006
If to the Employee:
Ms. Emily Woods
227 West 17th Street
8th Floor
New York, NY 10013
with a copy to:
Adam O. Emmerich, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd St.
New York, NY 10019
or to such other address as any party hereto may designate by
notice to the others, and shall be deemed to have been given upon
receipt.
(b) This Agreement, along with the Stock Option Grant
Agreements dated as of October 17, 1997 by and between the
Employee and the Parent and the Stockholders' Agreement dated as
of October 17, 1997 by and between the Employee and the Parent,
constitute the entire agreement among the parties hereto with
respect to the Employee's Employment, and supersedes
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and is in full substitution for any and all prior understandings
or agreements with respect to the Employee's Employment.
(c) This Agreement may be amended only by an
instrument in writing signed by the parties hereto, and any
provision hereof may be waived only by an instrument in writing
signed by the party or parties against whom or which enforcement
of such waiver is sought. The failure of any party hereto at any
time to require the performance by any other party hereto of any
provision hereof shall in no way affect the full right to require
such performance at any time thereafter, nor shall the waiver by
any party hereto of a breach of any provision hereof be taken or
held to be a waiver of any succeeding breach of such provision or
a waiver of the provision itself or a waiver of any other
provision of this Agreement.
(d) (i) This Agreement is binding on and is for the
benefit of the parties hereto and their respective successors,
heirs, executors, administrators and other legal representatives.
Neither this Agreement nor any right or obligation hereunder may
be assigned by the Employer or by the Employee.
(ii) The Employer shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Employer expressly to assume and agree to perform
this Agreement in the same manner and to the same extent that the
Employer would have been required to perform it if no such
succession had taken place. As used in the Agreement, "the
Employer" shall mean both the Employer as defined above and any
such successor that assumes and agrees to perform this Agreement,
by operation of law or otherwise.
(e) If any provision of this Agreement or portion
thereof is so broad, in scope or duration, so as to be
unenforceable, such provision or portion thereof shall be
interpreted to be only so broad as is enforceable.
(f) The Employer may withhold from any amounts payable
to the Employee hereunder all federal, state, city or other taxes
that the Employer may reasonably determine are required to be
withheld pursuant to any applicable law or regulation.
(g) This Agreement shall be governed by and construed
in accordance with the laws of the State of NEW YORK, without
reference to its principles of conflicts of law.
(h) This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all
of which shall constitute one and the same instrument.
(i) The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or
control or affect the meaning of any provision hereof.
(j) Exhibit A hereto shall be subject to the provision
of paragraphs (a), (c), (d), (f), (g) and (i) of this Section 12.
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this
Agreement, except that TPG II is only a party to this Agreement
with respect to its obligations under Section 2(c) hereof, as of
the date first written above.
J. CREW GROUP, INC.
-------------------------------
Name:
Title:
J. CREW OPERATING CORP.
-------------------------------
Name:
Title:
TPG Partners II, L.P.
-------------------------------
Name:
Title:
-------------------------------
Emily Woods
13