Exhibit 10.1

 

 

dELiA*s, INC.

Employment Agreement for Dyan Jozwick

 

 

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dELiA*s, INC.

Employment Agreement for Dyan Joswick

 

     Page  

1.      Definitions

     1   

2.      Term of Employment

     3   

3.      Position, Duties and Responsibilities

     3   

4.      Base Salary

     4   

5.      Annual Incentive Awards

     4   

6.      Long-Term Stock Incentive Programs

     4   

7.      Employee Benefit Programs

     5   

8.      Disability

     5   

9.      Reimbursement of Business and Other Expenses

     6   

10.    Termination of Employment

     6   

11.    Confidentiality; Cooperation with Regard to Litigation

     10   

12.    Non-competition

     11   

13.    Non-solicitation

     11   

14.    Remedies

     11   

15.    Resolution of Disputes

     12   

16.    Indemnification

     12   

17.    Effect of Agreement on Other Benefits

     12   

18.    Assignability; Binding Nature

     12   

19.    Representation

     13   

20.    Entire Agreement.

     13   

21.    Amendment or Waiver

     13   

22.    Severability

     13   

23.    Survivorship

     13   

24.    Beneficiaries/References

     13   

25.    Governing Law/Jurisdiction

     14   

26.    Notices

     14   

27.    Headings

     14   

28.    Counterparts

     14   

29.    Tax Matters

     14   

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EMPLOYMENT AGREEMENT

AGREEMENT, made and entered into as of the 16th day of June, 2011 by and between
dELiA*s, Inc., a Delaware corporation (together with its successors and assigns
permitted under this Agreement, the “Company”), and Dyan Jozwick (the
“Executive”).

W I T N E S S E T H :

WHEREAS, the Company desires to employ the Executive pursuant to an agreement
embodying the terms of such employment (this “Agreement”) and the Executive
desires to enter into this Agreement and to accept such employment, subject to
the terms and provisions of this Agreement;

NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein and for other good and valuable consideration, the receipt of which is
mutually acknowledged, the Company and the Executive (individually a “Party” and
together the “Parties”) agree as follows:

 

  1. Definitions.

 

  (a) “Amended and Restated 2005 Stock Incentive Plan” shall have the meaning
set forth in Section 6 below.

 

  (b) “Base Salary” shall have the meaning set forth in Section 4 below.

 

  (c) “Board” shall mean the Board of Directors of the Company.

 

  (d) “Cause” shall have the meaning set forth in Section 10(b) below.

 

  (e) “Change in Control” shall be deemed to have occurred as of the first day
that any one or more of the following conditions is satisfied:

(i) Any person or “group” (within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than
the Company, any subsidiary of the Company, the Executive, or any of their
respective Affiliates (each, an “Affiliated Entity”), becomes the “beneficial
owner”(as that term is defined in Rule 13d-3 under the Exchange Act) of
securities of the Company representing 50% or more of the combined voting power
of the Company’s then outstanding securities ordinarily (and apart from rights
accruing under special circumstances) having the right to vote in the election
of directors;

(ii) any one of the following occurs: (A) any merger or consolidation of the
Company with or into another entity (other than an Affiliated Entity), except a
merger or consolidation (x) in which persons who were stockholders of the
Company immediately prior to the merger or consolidation own, immediately
thereafter, directly or indirectly, more than 20% of the combined voting power
ordinarily (and apart from rights accruing under special circumstances) having
the right to vote in the election of directors of the continuing or surviving
entity or (y) in which the directors of the Company immediately prior to such
merger or consolidation would, immediately thereafter, constitute at least a
majority of the directors of the continuing or surviving entity; (B) any

 

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sale, exchange, lease, transfer or other disposition (in a single transaction or
a series of related transactions) of all or substantially all of the assets of
the Company on a consolidated basis to any person or group other than an
Affiliated Entity; or (C) any complete liquidation or dissolution of the
Company; or

(iii) individuals who, during any period of 12 consecutive months, are members
of the Board of Directors of the Company at the beginning of such period (the
“Existing Directors”), cease, for any reason, to constitute a majority of the
number of directors of the Company as determined in the manner prescribed in the
Company’s Certificate of Incorporation and Bylaws; provided, however, that if
the election or nomination for election of any new director was approved by a
vote of at least 50% of the Existing Directors, such new director shall be .
considered an Existing Director.

 

  (f) “Confidential Information” shall have the meaning set forth in Section 11
below.

 

  (g) “Constructive Termination Without Cause” shall have the meaning set forth
in Section 10(c) below.

 

  (h) “Effective Date” shall have the meaning set forth in Section 2 below.

 

  (i) “MIP” shall have the meaning set forth in Section 5 below.

 

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  (j) “Restriction Period” shall have the meaning set forth in Section 12 below.

 

  (k) “Severance Period” shall have the meaning set forth in Section 10(c)(ii)
below.

 

  (l) “Subsidiary” shall have the meaning set forth in Section 11 below.

 

  (m) “Term of Employment” shall have the meaning set forth in Section 2 below.

 

  (n) “Termination Without Cause” shall have the meaning set forth in
Section 10(c) below.

 

  2. Term of Employment.

(a) The term of the Executive’s employment under this Agreement shall commence
on June 16, 2011 (the “Effective Date”) and end on the third anniversary of such
date, unless Executive’s employment ceases earlier pursuant to the terms of this
Agreement (the “Term of Employment”).

(b) Notwithstanding anything in this Agreement to the contrary, at least 90 days
prior to the expiration of the Term of Employment, the Parties shall meet to
discuss this Agreement and attempt to negotiate a mutually acceptable new
employment agreement or amendment to this Agreement, governing the period
subsequent to the Term of Employment. Nothing in this subparagraph 2(b) shall
obligate Company or Executive to enter into a new employment agreement or an
amendment of this Agreement.

 

  3. Position, Duties and Responsibilities.

(a) Generally. Executive shall serve as President of the Company’s dELiA*s Brand
(Retail and Direct) reporting to the Company’s Chief Executive Officer at the
Company’s office located at 50 West 23rd Street, New York, New York
10010. Executive shall be responsible for all dELiA*s Brand merchandise whether
in the catalog, on dELiA*s website or in the stores. Executive shall be
responsible for all fashion and styling direction, visual merchandising of the
stores, trend and color direction, as well as all creative and design elements
as they pertain to the design and creative direction of the dELiA*s catalog and
website. Executive shall have and perform such duties, responsibilities, and
authorities as shall be reasonably assigned by the Company from time to time and
as are consistent with the above-mentioned position, which may be modified as
the Company and Executive deem necessary in their reasonable
discretion. Executive shall devote substantially all of Executive’s business
time and attention (except for periods of vacation or absence due to illness),
and Executive’s best efforts, abilities, experience, and talent to Executive’s
position and the businesses of the Company in accordance with all Company
policies. Company agrees that Executive’s title shall not be changed subordinate
to the title of President of the Company’s dELiA*s Brand.

(b) Other Activities. Anything herein to the contrary notwithstanding, nothing
in this Agreement shall preclude the Executive from (i) engaging in reasonable
charitable activities and community affairs and (ii) managing Executive’s
personal investments and affairs, provided that such activities do not
materially interfere with the proper performance of Executive’s duties and
responsibilities under this Agreement and not otherwise detrimental to the
interests of the Company. Unless approved in writing by the Board of the
Company, such approval not to be unreasonably withheld, the Executive may not
serve on the board of directors of any corporation or the board of any
association and/or charitable organization.

 

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  4. Base Salary.

The Executive shall be paid an annualized salary, payable in accordance with the
regular payroll practices (including bi-weekly pay periods) of the Company, of
not less than $500,000, less applicable withholdings, subject to annual review
thereafter at the start of each fiscal year for increase at the discretion of
the Compensation Committee of the Board (“Base Salary”). Executive’s first
annual review is expected to occur on or about April, 2012. Base Salary at any
time shall not be reduced by more than ten percent (10%).

 

  5. Annual Incentive Awards.

(a) Subject to the terms and conditions of the plan that shall govern
eligibility and participation, Executive shall participate in the Company’s
Management Incentive Plan each year during the Term of Employment (the “MIP”)
with a target annual incentive award opportunity of no less than 60% of Base
Salary or in a successor plan to the MIP that provides the Executive with a
substantially equivalent opportunity and Company agrees that Executive’s target
annual incentive award opportunity shall not be less than 60% of Base Salary.
Payment of annual incentive awards shall be made at the same time that other
participants in the MIP receive their incentive awards.

(b) Additionally, the minimum amount of the annual incentive award payable to
Executive under the 2011 MIP for the Company’s fiscal year ending January 28,
2012 shall be ($200,000), subject to the terms and conditions of the plan that
shall govern eligibility and participation. Such amount shall be payable as
follows: 50% of the minimum amount of the annual incentive award ($100,000) will
be paid within thirty (30) days after the Effective Date (the “First MIP
Payment”) and the remaining 50% of the minimum bonus amount ($100,000) (the
“Second MIP Payment”) will be paid on or about April 1, 2012 at the conclusion
of the Company’s annual performance review process. Notwithstanding the
foregoing to the contrary, if Employee voluntarily terminates her employment
with the Company on or prior to April 1, 2012, then upon such termination
Employee shall pay to Company an amount equal to the pro-rated amount of the
First MIP Payment based on a 10 month period and the time remaining from the
date of voluntary termination to April 1, 2012.

 

  6. Long-Term Stock Incentive Programs.

(a) General/Options. Subject to the terms and conditions of the Amended and
Restated 2005 Stock Incentive Plan governing eligibility and participation,
Executive shall be eligible to participate in and to receive stock incentive
awards under the Amended and Restated 2005 Stock Incentive Plan and any
successor plan. Executive shall also receive an initial stock option grant of
300,000 stock options at an exercise price equal to the closing price of dELiA*s
stock on NASDAQ on the day of the Effective Date. 100,000 of such stock options
shall vest on the day immediately succeeding the Effective Date and 200,000 of
such stock options shall vest in four equal installments of 50,000 on each of
the 1st, 2nd, 3rd and 4th anniversaries of the Effective Date. In addition, upon
a Change in Control the tranche of 50,000 stock options which are scheduled to
vest on the next succeeding anniversary of the Effective Date shall vest as of
the date of such Change in Control

(b) In addition, Employee shall receive a minimum grant of 50,000 stock options
as part of the Company’s annual performance review process for each of the next
two annual performance review processes provided Employee receives a “meets
expectations” review score. If Employee receives a higher review score than
“meets expectations”, subject to Compensation Committee approval, the grant of
stock options may be increased above such amount.

 

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  7. Employee Benefit Programs; Relocation.

(a) During the Term of Employment, the Executive shall be entitled to
participate in such employee pension and welfare benefit plans and programs of
the Company as are made available to the Company’s employees generally, as such
plans or programs may be in effect or modified from time to time, including,
without limitation, health, medical, dental, long-term disability, life
insurance, 401(k) with Company match and employee discounts. Executive will be
eligible for four (4) weeks paid vacation as well as Company observed holidays,
five (5) sick days and three (3) personal days in accordance with Company
policy. The terms of the Company’s official plan documents shall govern the
terms of Executive’s eligibility and participation in Company’s benefit plans.

(b) In addition, the Company shall provide Employee the following through
July 31, 2011 to assist with her relocation from California to New York, (i) a
$6,000 per month housing/living allowance and up to (ii) four (4) round trip
coach class flights per month between New York and California.

 

  8. Disability.

(a) During the Term of Employment, and subject to the terms and conditions on
eligibility and participation as set forth in the Company’s Long-Term Disability
Plan documents, the Executive shall be entitled to disability coverage as
described in this Section 8(a). In the event the Executive becomes disabled, as
that term is currently defined under the Company’s Long-Term Disability Plan the
Executive shall be entitled to receive benefits pursuant to the Company’s
Long-Term Disability Plan, in place of Executive’s Base Salary and any other
employee benefits other than for disabled employees in an amount pursuant to the
Company’s Long-Term Disability Plan in effect at the commencement date of the
disability (“Commencement Date”) for a period beginning on the Commencement Date
and ending with the Executive’s attainment of age 65. If (i) the Executive
ceases to be disabled (as determined in accordance with the terms of the
Long-Term Disability Plan) during the Term of Employment, (ii) Executive’s
position or another senior executive position is then vacant and (iii) the
Company requests in writing that Executive resume such position, Executive may
elect to resume such position by written notice to the Company within 15 days
after the Company delivers its request. If Executive resumes such position,
Executive shall thereafter be entitled to Executive’s Base Salary at the annual
rate in effect at the Commencement Date and, for the year Executive resumes
Executive’s position, a pro rata annual incentive award and to participate in
any other employee benefit programs outlined in Section 6 and 7 of this
Agreement that are then in effect. If Executive ceases to be disabled and does
not resume Executive’s position in accordance with the preceding sentence,
Executive shall be treated as if Executive voluntarily terminated Executive’s
employment pursuant to Section 10(e) as of the date the Executive ceases to be
disabled. If the Executive is not offered Executive’s position or another
executive position after Executive ceases to be disabled during the Term of
Employment, Executive shall be treated as if Executive’s employment was
terminated without Cause pursuant to Section 10(c) as of the date the Executive
ceases to be disabled.

(b) Subject to the applicable plan documents, during the period the Executive is
receiving disability benefits pursuant to Section 8(a) above, Executive shall
continue to be treated as an employee for purposes of all employee benefits and
entitlements in which Executive was participating on the Commencement Date,
including without limitation, the benefits and entitlements referred to in
Sections 6 and 7 above, except that the Executive shall not be entitled to
receive any annual salary increases or any new stock incentive awards following
the Commencement Date.

 

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  9. Reimbursement of Business and Other Expenses.

The Executive is authorized to incur reasonable expenses in carrying out
Executive’s duties and responsibilities under this Agreement, and the Company
shall promptly reimburse Executive for all business expenses incurred in
connection therewith, subject to documentation in accordance with the Company’s
travel and expense reimbursement policy.

 

  10. Termination of Employment.

(a) Termination_Due_to_Death. In the event the Executive’s employment with the
Company is terminated due to Executive’s death, Executive’s estate or
Executive’s beneficiaries, as the case may be, shall be entitled to and their
sole contractual remedies under this Agreement shall be:

(i) Base Salary through the date of death, which shall be paid in a single lump
sum not later than 15 days following the Executive’s death;

(ii) the right to exercise all outstanding stock options that are vested as of
the date of death for a period of one year following death or for the remainder
of the exercise period, if less;

(iii) the restrictions shall lapse on all shares of restricted stock awarded
where restrictions have not yet lapsed; and

(iv) other or additional benefits then due or earned in accordance with
applicable plans and programs of the Company.

(b) Termination by the Company for Cause.

(i) “Cause” shall mean:

(A) Executive’s conviction of, entrance of a plea of guilty or nolo contendere
to, a felony unless the Executive’s conduct is so plainly severe or the threat
to the Company’s reputation that in the Company’s reasonable business judgment
requires the Company to terminate the Executive immediately in its reasonable
discretion or business judgment; or

(B) fraudulent conduct by Executive in connection with the business affairs of
the Company; or

(C) theft, embezzlement, or other criminal misappropriation of funds by
Executive from the Company (other than good faith expense account disputes); or

(D) Executive’s willful misconduct, which has, or would if generally known,
material adversely affect the goodwill, business, or reputation of the Company;
or

(E) Executive’s material breach of this Agreement that is not cured within
fifteen (15) days of receipt of written notice from the Company detailing such
alleged material breach.

For purposes of this Agreement, an act or failure to act on Executive’s part
shall be considered “willful” if it was done or omitted to be done by Executive
not in good faith, and shall not include any act or failure to act resulting
from any incapacity of Executive.

(ii) In the event the Company terminates the Executive’s employment for Cause,
Executive shall be entitled to and Executive’s sole remedies under this

 

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Agreement shall be:

(A) Base Salary through the date of the termination of Executive’s employment
for Cause, which shall be paid in a single lump sum not later than 15 days
following the Executive s termination of employment; and

(B) other or additional benefits, to the extent then due or earned in accordance
with applicable plans or programs of the Company.

(c) Termination Without Cause or Constructive Termination Without Cause. In the
event the Executive’s employment with the Company is terminated without Cause
(which termination shall be effective as of the date specified by the Company in
a written notice to the Executive), other than due to death, or in the event
there is a Constructive Termination Without Cause (as defined below), the
Executive shall be entitled to and Executive’s sole remedies under this
Agreement shall be:

(i) Base Salary through the date of termination of the Executive’s employment,
which shall be paid in a single lump sum not later than 15 days following the
Executive’s termination of employment;

(ii) Base Salary, at the annualized rate in effect immediately prior to the date
of communication (verbal or otherwise) from Company to Executive of termination
of the Executive’s employment (or in the event a reduction in Base Salary is the
basis for a Constructive Termination Without Cause, then the Base Salary in
effect immediately prior to such reduction), for a period of 6 months following
such termination to be paid, less applicable withholdings, in accordance with
the Company’s standard payroll cycle (the “Initial Severance Period”) to the
extent that such payment is non-qualified deferred compensation as defined in
Code Section 409A (as defined below) such payments to commence on the sixtieth
(60th) day following the Executive’s termination of employment; provided that if
and only if for the seventh (7th) month through the end of the twelfth
(12th) month after termination or the portion thereof that Executive does not
engage in Competition with the Company as defined in Section 12 below (the
“Secondary Severance Period”), then Executive shall receive Base Salary for the
Secondary Severance Period in the same manner as paid for the Initial Severance
Period; provided further that the salary continuation payment under this
Section 10(c)(ii) shall be in lieu of any salary continuation arrangements under
any other severance program of the Company or any other agreement between the
Executive and the Company;

(iii) (A) all unvested stock options shall vest as of the date of termination
and (B) the right to exercise all outstanding stock options that are vested as
of the date of termination during the 90-day period following termination or for
the remainder of the exercise period, if less;

(iv) continued participation in all medical, and dental plans at the same
benefit and rate level at which Executive was participating on the date of the
termination of Executive’s employment, subject to the terms and conditions of
the official plan documents, until the and the end of the Severance Period with
the continuation under this section being provided through COBRA;

(v) if the termination occurs prior to April 1, 2012, the Second MIP Payment to
be paid in a single lump sum not later than fifteen (15) days after termination;
and

(vi) other or additional benefits then due or earned in accordance with
applicable plans and programs of the Company.

“Termination Without Cause” shall mean the Executive’s employment is terminated
by the Company for any reason other than Cause (as defined in Section

 

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10 (b)) or due to death.

“Constructive Termination Without Cause” shall mean a termination of the
Executive’s employment at Executive’s initiative as provided in this
Section 10(c) following the occurrence, without the Executive’s written consent,
of one or more of the following events (except as a result of a prior
termination):

(A) a material diminution in Executive’s authority, duties or job
responsibilities ;

(B) a material diminution in annual Base Salary; or

(C) a change in the geographic location in which the Executive performs the
functions set forth in Section 3(a) above by more than 50 miles from 50 West
23rd Street, New York, New York; or

(D) a failure by the Company to perform any material obligation under, or breach
by the Company of any material provision of, this Agreement that is not cured
within 30 days of receipt of written notice from Executive, including, but not
limited to, the provisions of Sections 3(a) and 5(a) and the last sentence of
Section 4.

The Executive must provide notice to the Company of the condition described in
(A), (B), (C) or (D) above within a period not to exceed 120 days of the initial
existence of the condition, upon the notice of which the Company shall be
provided 30 days during which it may remedy the condition and not be required to
pay any amount pursuant to Section 10(c). In addition, the Executive must
terminate employment with the Company within 120 days after the initial
existence of the condition.

(d) Change in Control. In the event the Executive’s employment with the Company
is terminated without Cause (which termination shall be effective as of the date
specified by the Company in a written notice to the Executive), other than due
to death, or in the event there is a Constructive Termination Without Cause (as
defined above), in either case within one (1) year following a Change in
Control, the Executive shall be entitled to and Executive’s sole remedies under
this Agreement shall be:

(i) Base Salary through the date of termination of the Executive’s employment,
which shall be paid in a single lump sum not later than 15 days following the
Executive’s termination of employment;

(ii) Base Salary, at the annualized rate in effect immediately prior to the date
of communication (verbal or otherwise) from Company to Executive of termination
of the Executive’s employment (or in the event a reduction in Base Salary is the
basis for a Constructive Termination Without Cause, then the Base Salary in
effect immediately prior to such reduction), for a period of 6 months following
such termination to be paid, less applicable withholdings, in accordance with
the Company’s standard payroll cycle (the “Initial Section 10 (d) Severance
Period”); provided that if and only if for the Secondary Severance Period
Executive does not engage in Competition with the Company as defined in
Section 12 below, then Executive shall receive Base Salary for the Secondary
Severance Period in the same manner as paid for the Initial Section 10(d)
Severance Period; provided further that the salary continuation payment under
this Section 10(d)(ii) shall be in lieu of any salary continuation arrangements
under any other severance program of the Company or any other agreement between
the Executive and the Company;

(iii) (A) all unvested options shall vest as of the date of termination; and
(B) the right to exercise all outstanding stock options that are vested as of
the date of termination during the ninety (90) day period following termination
or for the remainder of the

 

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exercise period if less;

(iv) continued participation in all medical, and dental plans at the same
benefit and rate level at which Executive was participating on the date of the
termination of Executive’s employment, subject to the terms and conditions of
the official plan documents, until the end of the Section 10 (d) Severance
Period with the continuation under this section being provided through COBRA;

(v) if the termination occurs prior to April 1, 2012, the Second MIP Payment to
be paid in a single lump sum not later than fifteen (15) days after termination;
and

(vi) other or additional benefits then due or earned in accordance with
applicable plans and programs of the Company.

(e) Voluntary_Termination.

(i) In the event of a termination of employment by the Executive on Executive’s
own initiative after delivery of 60 days advance written notice, other than a
termination due to death or Constructive Termination Without Cause, the
Executive shall have the same entitlements as provided in Section 10(b)(ii)
above for a termination for Cause. Notwithstanding any implication to the
contrary, the Executive shall not have the right to terminate Executive’s
employment with the Company during the Term of Employment except in the event of
a Constructive Termination Without Cause. Any voluntary termination of
employment during the Term of Employment shall entitle the Executive to the same
entitlements as provided in Section 10(b)(ii) above for a termination for Cause.
In the event the Executive becomes disabled, as that term is defined under the
Company’s Long Term Disability Plan, the Executive’s termination of employment
shall be governed by the terms of Section 8 of this Agreement.

(f) No Mitigation; No Offset. In the event of any termination of employment
under this Section 10, the Executive shall not be obligated to seek other
employment; amounts due the Executive under this Agreement shall not be offset
by any remuneration attributable to any subsequent employment that Executive may
obtain.

(g) Nature of Payments. Any amounts due under this Section 10 are in the nature
of severance payments considered to be reasonable by the Company and are not in
the nature of a penalty.

(h) Exclusivity of Severance Payments; Remedies Under this Agreement. Upon
termination of the Executive’s employment during the Term of Employment, other
than amounts due as provided in this Section 10, Executive shall not be entitled
to any severance payments or severance benefits from the Company. Should
Executive accept such severance payments, such payment shall be in lieu of any
payments by the Company on account of any claim by Executive of wrongful
termination, including, but not limited to, claims under any federal, state or
local human and civil rights or labor laws. The parties agree that the phrase
“sole remedies under this Agreement” as used in this Agreement does not include
any statutory or common law remedies as to which Executive is be entitled to
pursue provided Executive does not accept any payment under this Section 10.

(i) Release of Employment Claims. The Executive agrees, as a condition to
receipt of the termination payments and benefits provided for in this
Section 10, that Executive will execute (and not revoke) a release agreement
within the time period required by the Company and applicable law, in a form
reasonably satisfactory to the Company and the Executive, releasing any and all
claims arising out of the Executive’s employment (other than enforcement of this
Agreement).

 

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  11. Confidentiality; Cooperation with Regard to Litigation.

(a) During the Term of Employment and thereafter, the Executive shall not,
without the prior written consent of the Company, disclose to anyone or make use
of any Confidential Information, except when required to do so in the normal
course of conducting business on behalf of the Company, by legal process, by any
governmental agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a committee
thereof) that requires Executive to divulge, disclose or make accessible such
information. In the event that the Executive is so ordered, Executive shall give
prompt prior written notice to the Company in order to allow the Company the
opportunity to object to or otherwise resist such order and consents and will
not object to the Company’s standing to consent or seek protection relating to
any such order.

(b) During the Term of Employment and thereafter, Executive shall not disclose
the existence or contents of this Agreement beyond what is disclosed in the
proxy statement or documents filed with the government unless and to the extent
such disclosure is required by law, by a governmental agency, or in a document
required by law to be filed with a governmental agency or in connection with
enforcement of her rights under this Agreement. In the event that disclosure is
so required, the Executive shall give prompt prior written notice to the Company
in order to allow the Company the opportunity to object to or otherwise resist
such requirement. This restriction shall not apply to such disclosure by
Executive to members of Executive’s immediate family, Executive’s tax, legal or
financial advisors, any lender or tax authorities or to potential future
employers to the extent necessary, each of whom shall be advised not to disclose
such information. Similarly, Executive acknowledges that the Company shall have
the right to advise potential or actual future employers of Executive of her
post-employment obligations under this Agreement.

(c) “Confidential Information” shall mean all information that is not known or
available to the public concerning the business of the Company or any Subsidiary
relating to any of their products, product development, designs, costing,
marketing plans and strategies, expansion plans and strategies, trade secrets,
customers, suppliers, finances, and business plans and strategies. For this
purpose, information known or available generally within the trade or industry
of the Company or any Subsidiary shall be deemed to be known or available to the
public. Confidential Information shall include information that is, or becomes,
known to the public as a result of a breach by the Executive of the provisions
of Section 11(a) above.

(d) “Subsidiary” shall mean any corporation controlled directly or indirectly by
the Company and any affiliate of the Company.

(e) At any time during the Term of Employment when requested by the Company, or
immediately upon Executive’s cessation of employment with the Company, Executive
shall return all Company property to the Company, including, without limitation
all Company issued computers, laptops, PDAs, Blackberries or other Company
property or Confidential Information.

(f) The Executive agrees to cooperate with the Company, during the Term of
Employment and thereafter (including following the Executive’s termination of
employment for any reason), by making herself available to testify on behalf of
the Company or any Subsidiary or affiliate of the Company, in any action, suit,
or proceeding, whether civil, criminal, administrative, or investigative, and to
assist the Company, or any Subsidiary or affiliate of the Company, in any such
action, suit, or proceeding, by providing information and meeting and consulting
with the Board or its representatives or counsel, or representatives or counsel
to the Company, or any Subsidiary or affiliate of the Company, requesting
Executive’s provision of testimony or assistance. Notwithstanding anything to
the contrary herein, Executive shall only be obligated to comply with this
Section 11(f) if such cooperation or assistance does not materially

 

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interfere with her professional or personal obligations and the Company secures
at its own cost, reasonable travel and lodging expenses to be incurred by
Executive in providing such cooperation and assistance.

 

  12. Non-competition.

(a) During the Restriction Period (as defined in Section 12(b) below) and in
consideration for any payments pursuant to Section 10, the Executive shall not
engage in Competition with the Company or any Subsidiary. “Competition” shall
mean engaging in any activity, except as provided below, for a Competitor of the
Company or any Subsidiary, whether as an employee, consultant, principal, agent,
officer, director, partner, shareholder (except as a less than one percent
shareholder of a publicly traded company) or otherwise. A “Competitor” shall
mean the entities on Exhibit A annexed hereto and/or any store based, catalog or
internet retailer which principally markets or sells in the United States
specialty apparel, clothing or accessories to girls and women between the ages
of 13 and 20 and that first commences to exist and/or operate in Competition
with the Company after the Effective Date (a “Competitive Business”). If the
Executive commences employment or becomes a consultant, principal, agent,
officer, director, partner, or shareholder of any entity that is not a
Competitor at the time the Executive initially becomes employed or becomes a
consultant, principal, agent, officer, director, partner, or shareholder of the
entity, future activities of such entity shall not result in a violation of this
provision unless (x) such activities were contemplated at the time the Executive
initially became employed or becomes a consultant, principal, agent, officer,
director, partner, or shareholder of the entity (and the contemplation of such
activities was known to the Executive) or (y) the Executive commences directly
or indirectly overseeing or managing the activities which are competitive with
the activities of the Company or Subsidiary.

(b) For the purposes of this Section 12 and Section 13 below, “Restriction
Period” shall mean the period beginning with the Effective Date and ending six
(6) months after termination.

 

  13. Non-solicitation

(a) Employees. During the Restriction Period, Executive shall not induce and/or
solicit employees of the Company or any Subsidiary to terminate their
employment. During the portion of the Restriction Period following the
termination of the Executive’s employment, the Executive shall not directly or
indirectly hire any employee of the Company or any Subsidiary or any person who
was employed by the Company or any Subsidiary within 180 days of such hiring.

(b) Vendors/Business Partners. Executive promises and agrees that during the
Restriction Period, Executive will not influence or attempt to influence
vendors, or business partners of the Company or any of its present or future
subsidiaries, either directly or indirectly, to divert from the Company their
business to any individual, partnership, firm, corporation or other entity then
in competition with the business of the Company or any subsidiary or the
Company.

 

  14. Remedies.

In addition to whatever other rights and remedies the Company may have at equity
or in law, if the Executive breaches any of the provisions contained in Sections
11, 12 or 13 above or any other obligations of Executive to the Company under
this Agreement, the Company (a) shall have the right to immediately terminate
all payments and benefits due under this Agreement (b) shall have the right to
seek injunctive relief without the necessity for posting a bond and (c) shall
have the right to seek attorneys’ fees and costs associated with enforcing its
rights under this Agreement. The Executive acknowledges that such a breach would
cause irreparable injury and that money damages would not provide an adequate
remedy for the

 

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Company and that the Company retains its rights to seek all other available
relief in addition to the relief set forth in this Section.

 

  15. Resolution of Disputes.

Any disputes arising under or in connection with this Agreement shall be
submitted to the federal or state courts in the State of New York, New York
County. Pending the resolution of any court proceeding, the Company shall
continue payment of all amounts and benefits due the Executive under this
Agreement.

 

  16. Indemnification.

(a) Company Indemnity. The Company agrees that if the Executive is made a party,
or is threatened to be made a party, to any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a “Proceeding”), by reason of
the fact that Executive is or was a director, officer or employee of the Company
or any Subsidiary or is or was serving at the request of the Company or any
Subsidiary as a director, officer, member, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether or not the basis of such
Proceeding is the Executive’s alleged action in an official capacity while
serving as a director, officer, member, employee or agent, the Executive shall
be defended in the first instance at the Company’s sole cost and expense,
indemnified and held harmless by the Company to the fullest extent legally
permitted or authorized by the Company’s certificate of incorporation or bylaws
or resolutions of the Company’s Board of Directors or, if greater, by the laws
of the State of Delaware, against all cost, expense, liability and loss
(including, without limitation, attorney’s fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Executive in connection therewith, and such
indemnification shall continue as to the Executive even if Executive has ceased
to be a director, member, officer, employee or agent of the Company or other
entity and shall inure to the benefit of the Executive s heirs, executors and
administrators.

(b) No Presumption Regarding Standard of Conduct. Neither the failure of the
Company (including its board of directors, independent legal counsel or
stockholders) to have made a determination prior to the commencement of any
proceeding concerning payment of amounts claimed by the Executive under
Section 16(a) above that indemnification of the Executive is proper because
Executive has met the applicable standard of conduct, nor a determination by the
Company (including its board of directors, independent legal counsel or
stockholders) that the Executive has not met such applicable standard of
conduct, shall create a presumption that the Executive has not met the
applicable standard of conduct.

(c) Liability Insurance. The Company agrees to continue and maintain a directors
and officers liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other executive officers.

 

  17. Effect of Agreement on Other Benefits.

Except as specifically provided in this Agreement, the existence of this
Agreement shall not be interpreted to preclude, prohibit or restrict the
Executive’s participation in any other employee benefit or other plans or
programs in which Executive currently participates.

 

  18. Assignability; Binding Nature.

This Agreement shall be binding upon and inure to the benefit of the Parties and
their respective successors, heirs (in the case of the Executive) and permitted
assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred to a subsidiary of

 

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the Company or in connection with the sale or transfer of all or substantially
all of the assets of the Company, provided that the assignee or transferee is
the successor to all or substantially all of the assets of the Company and such
assignee or transferee assumes the liabilities, obligations and duties of the
Company, as contained in this Agreement, either contractually or as a matter of
law. The Company further agrees that, in the event of a sale or transfer of
assets as described in the preceding sentence, it shall use reasonable efforts
in order to cause such assignee or transferee to expressly assume the
liabilities, obligations and duties of the Company hereunder. No rights or
obligations of the Executive under this Agreement may be assigned or transferred
by the Executive other than Executive’s rights to compensation and benefits,
which may be transferred only by will or operation of law, except as provided in
Section 24 below.

 

  19. Representation.

Each Party represents and warrants that it is fully authorized and empowered to
enter into this Agreement and that the performance of its obligations under this
Agreement will not violate any agreement between it and any other person, firm
or organization.

 

  20. Entire Agreement.

This Agreement contains the entire understanding and agreement between the
Parties concerning the subject matter hereof and supersedes all prior
agreements, understandings, discussions, negotiations and undertakings, whether
written or oral, between the Parties with respect thereto.

 

  21. Amendment or Waiver.

No provision in this Agreement may be amended unless such amendment is agreed to
in writing and signed by the Executive and an authorized officer of the Company.
No waiver by either Party of any breach by the other Party of any condition or
provision contained in this Agreement to be performed by such other Party shall
be deemed a waiver of a similar or dissimilar condition or provision at the same
or any prior or subsequent time. Any waiver must be in writing and signed by the
Executive or an authorized officer of the Company, as the case may be.

 

  22. Severability and Modification.

In the event that any provision or portion of this Agreement shall be determined
to be invalid or unenforceable for any reason, in whole or in part, the
remaining provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted by law. In the
event that a court or other tribunal determines that the restraints in Sections
11, 12 and 13 are in any way overbroad or unenforceable, the Parties acknowledge
and agree that the court or tribunal shall have the right to modify or sever the
restraints in order to enforce them to the fullest extent permitted by
applicable law.

 

  23. Survivorship.

The respective rights and obligations of the Parties hereunder shall survive any
termination of the Executive’s employment to the extent necessary to the
intended preservation of such rights and obligations.

 

  24. Beneficiaries/References.

The Executive shall be entitled, to the extent permitted under any applicable
law, to select and change a beneficiary or beneficiaries to receive any
compensation or benefit payable hereunder following the Executive’s death by
giving the Company written notice thereof. In the event of the Executive’s death
or a judicial determination of Executive’s incompetence, reference in this
Agreement to the Executive shall be deemed, where appropriate, to refer to
Executive’s

 

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beneficiary, estate or other legal representative.

 

  25. Governing Law/Jurisdiction.

This Agreement shall be governed by and construed and interpreted in accordance
with the laws of New York without reference to principles of conflict of laws.
Subject to Section 15, the Company and the Executive hereby consent to the
exclusive jurisdiction of any or all of the following courts for purposes of
resolving any dispute under this Agreement: (i) the United States District Court
for New York and (ii) the Supreme Court of the State of New York, New York
County. The Company and the Executive hereby waive, to the fullest extent
permitted by applicable law, any objection which it or he may now or hereafter
have to such jurisdiction and any defense of inconvenient forum.

 

  26. Notices.

Any notice given to a Party shall be in writing and shall be deemed to have been
given when delivered personally or sent by certified or registered mail, postage
prepaid, return receipt requested, or via nationally recognized overnight
courier prepaid, duly addressed to the Party concerned at the address indicated
below or to such changed address as such Party may subsequently give such notice
of:

 

If to the Company:

   dELiA*s, Inc.    50 West 23rd St.    New York, New York 10010    Attention:
Vice President Human Resources and Vice President and General Counsel

If to the Executive:

   Dyan Jozwick    18221 James Road    Villa Park, CA 92861

With a copy to:

   Michael A. Saffer, Esq.    Mandelbaum Salsburg, P.C.    155 Prospect Avenue
   West Orange, New Jersey 07052

 

  27. Headings.

The headings of the sections contained in this Agreement are for convenience
only and shall not be deemed to control or affect the meaning or construction of
any provision of this Agreement.

 

  28. Counterparts

This Agreement may be executed in two or more counterparts.

 

  29. Tax Matters

(a) Tax Withholding. The Company shall withhold from any amounts payable under
this Agreement such federal, state and local taxes as may be required to be
withheld pursuant to any applicable law or regulation.

(b) Section 409A Compliance. The intent of the parties is that payments and
benefits under this Agreement comply with Internal Revenue Code Section 409A and
the regulations and guidelines promulgated thereunder (collectively “Code
Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement
shall be interpreted to be in compliance therewith. If Executive notifies the
Company (with specificity as to the reason

 

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therefore) that Executive believes that any provision of this Agreement (or of
any award of compensation, including equity compensation or benefits) would
cause Executive to incur any additional tax or interest under Code Section 409A,
the Company shall, after consulting with Executive, reform such provision to try
to comply with Code Section 409A through good faith modifications to the minimum
extent reasonably appropriate to conform with Code Section 409A. To the extent
that any provision hereof is modified in order to comply with Code Section 409A,
such modification shall be made in good faith and shall, to the maximum extent
reasonably possible, maintain the original intent and economic benefit to
Executive and the Company of the applicable provision without violating the
provision of Code Section 409A.

(c) Special Section 409A Rules. This paragraph shall apply to all or any portion
of any payment or benefit a payable under the Agreement as a result of
termination of Executive’s employment that is not exempted from Code
Section 409A (“409A Severance Compensation”).

(i) Separation from Service. If the termination of the Employee’s employment
does not qualify as a “separation from service” within the meaning of Treasury
Regulation section 1.409A-1(h) from the “Company’s Controlled Group”, then any
409A Severance Compensation will not commence until a “separation from service”
occurs or, if earlier, the earliest other date as is permitted under Code
Section 409A. For this purpose, the “Company’s Controlled Group” means the
Company (i) any corporation which is a member of a controlled group of
corporations (as defined in Code Section 414(b)) which includes the Company and
(ii) any trade or business (whether or not incorporated) which is under common
control (as defined in Code Section 414(c)) with the Company.

(ii) Six-Month Delay for “Specified Employees”. Notwithstanding any provisions
to the contrary in this Agreement, if the Executive is deemed on the date of
termination to be a “specified employee” within the meaning of that term under
Code Section 409A (a)(2)(B), then with regard to any payment or the provision of
any benefit that is specified as subject to this Section, such payment or
benefit shall not be made or provided prior to the earlier or (i) the expiration
of six (6)-month period measured from the date of Executive’s “separation from
service” (as such term is defined under Code Section 409A), and (ii) the date of
Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period,
all payments and benefits delayed pursuant to this Section 30(c) (whether they
would have otherwise been payable in a single sum or in installments in absence
of such delay) shall be reimbursed to the Executive in a lump sum, and any
remaining payments and benefits due under this Agreement shall be paid or
provided in accordance with the normal payment dates specified for them herein.

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first written above.

 

dELiA*s, INC.

By:  

/s/ Walter Killough

Name:   Walter Killough Title:   Chief Executive Officer

EXECUTIVE

/s/ Dyan Jozwick

Dyan Jozwick

 

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EXHIBIT A

Aeropostale, Inc.

Abercrombie & Fitch, Co.

American Eagle Outfitters, Inc.

Wet Seal, Inc.

Pacific Sunwear of California, Inc.

Hot Topic, Inc.

The Buckle, Inc.

Charlotte Russe Holding, Inc.

Forever 21

H & M

Garage

All subsidiaries, divisions, affiliates and successors of the above-named
entities are included.

 

16