**EXHIBIT 10.3**

 

**EMPLOYMENTNON-COMPETE, NON-SOLICIT ANDCONFIDENTIALITY AGREEMENT**

 

**THISEMPLOYMENT NON-COMPETE, NON-SOLICIT AND CONFIDENTIALITY AGREEMENT (“AGREEMENT”)IS ENTERED INTO BETWEEN CITI TRENDS, INC. (“COMPANY”), AND ELIZABETH FEHER (“EMPLOYEE”),EFFECTIVE AS OF THE 2nd DAY OF APRIL, 2008.**

 

For and inconsideration of the mutual covenants and agreements contained herein and othergood and valuable consideration, the receipt and sufficiency of which arehereby acknowledged, the parties agree:

 

1.             Employment; Scope of Services.  Company shall employ Employee, and Employeeshall be employed by Company, as its Executive Vice President – ChiefMerchandising Officer (“Executive VP”). Employee’s primary job duties shallinclude development and implementation of the Company’s national merchandisingstrategy, including development of vendor relationships, pricing and inventoryplans, sales plans and other duties as more fully described in the applicablejob description (“Services”).

 

2.             At-Will Employment.  Nothing in this Agreement alters the at-willemployment relationship between Employee and Company. Employment with Companyis “at-will” which means that either Employee or Company may terminate theemployment relationship at any time, with or without notice, with or withoutcause. The date of Employee’s cessation of employment for any reason is the “SeparationDate.”

 

3.             Confidentiality.

 

(a)           Employee acknowledges and agrees that(1) the retail sale of value-priced/off-price family apparel is anextremely competitive industry; (2) Company has an ongoing strategy forexpansion of its business in the United States; (3) Company’s majorcompetitors operate throughout the United States and some internationally; and (4) becauseof Employee’s position as Executive VP, she will have access to, knowledge of,and be entrusted with, highly sensitive and competitive ConfidentialInformation (as defined in subsection (b) below) of Company, includingwithout limitation information regarding sales margins, purchasing and pricingstrategies, marketing strategies, vendors and suppliers, plans for expansionand placement of stores, and also specific information about Company’sdistricts and stores, such as staffing, budgets, profits and the financialsuccess of individual districts and stores.

 

(b)           “Confidential Information” includestechnical or sales data, formulas, patterns, compilations, programs, devices,methods, techniques, drawings, processes, financial data and statements,financial plans and strategies, product plans, sales or advertising informationand plans, marketing information and plans, pricing information, the identityor lists of employees, vendors and suppliers of Company, and confidential orproprietary information of such employees, vendors and suppliers. Employeeacknowledges and agrees that all Confidential Information is confidential andremains the sole and exclusive property of 

 

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Company. Employee agreesthat he shall (a) hold all Confidential Information in strictestconfidence; (b) not disclose, reproduce, distribute or otherwisedisseminate such Confidential Information, and shall protect such ConfidentialInformation from disclosure by or to others; and (c) make no use of suchConfidential Information without the prior written consent of Company, exceptin connection with Employee’s employment with Company. “ConfidentialInformation” means any and all data and information relating to Company which (i) deriveindependent economic value, actual or potential, from not being generally knownor readily ascertainable by proper means by other persons who may obtaineconomic value from their disclosure or use; and (ii) are the subject ofreasonable efforts under the circumstances to maintain their secrecy.

 

(c)           In the event any ConfidentialInformation does not qualify for protection as “trade secrets” as defined in theGeorgia Trade Secrets Act, then Employee acknowledges and agrees that theConfidential Information shall remain confidential and shall not be disclosedby Employee during Employee’s employment with Company and for a period of two (2) yearsfollowing the Separation Date, absent the express prior written consent ofCompany. Trade secret information shall remain confidential so long as suchinformation qualifies as a trade secret under applicable law.

 

(d)           Employee acknowledges that Companyhas provided or will provide Employee with Company property, including withoutlimitation employee handbooks, policy manuals, price lists, financial reports,and vendor and supplier information, among other items. Upon the SeparationDate, or upon the request of Company, Employee shall immediately deliver toCompany all property belonging to Company, including without limitation allConfidential Information and any property related to Company, whether inelectronic or other format, as well as any copies thereof, then in Employee’scustody, control or possession. Upon the Separation Date, Employee shallprovide Company with a declaration certifying that all Confidential Informationand any other Company property have been returned to Company, that Employee hasnot kept any copies of such items or distributed such items to any third party,and that Employee has otherwise complied with the terms of Section 3 ofthis Agreement.

 

4.             CovenantNot to Compete.  During Employee’semployment with Company and for a period of one (1) year following theSeparation Date, provided that the separation is based on either a terminationfor Cause as defined in the Employment Agreement executed by the parties orEmployee’s resignation, Employee shall not compete with Company on behalf of aCompetitor in the business of value-priced/off-price family apparel in the followingstates: South Carolina; Georgia; Alabama; Florida; North Carolina; Mississippi;Louisiana; Arkansas; Tennessee; Texas; Virginia; Ohio; Indiana; Kentucky; orMichigan, by acting as an Executive Vice President – Chief Merchandising Officerof such Competitor, or rendering any of the following services to suchCompetitor: developing or implementing marketing strategy; developing vendorrelationships, pricing or inventory plans; or developing sales plans. Forpurposes of this Section 4, the term “Competitor” shall mean only thefollowing businesses whose primary business is the sale of value-priced or off-pricefamily apparel, commonly known as: Cato, TJX (including without limitationTJMAXX and Marshalls), and Ross Stores. This covenant will not be applicable inthe event that Employee is terminated by 

 

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the Company for reasonsother than “cause” as defined in the Employment Agreement executed by theparties.

 

5.             Covenant Not to Recruit Personnel. DuringEmployee’s employment with Company and for a period of two (2) yearsfollowing the Separation Date, and regardless of the reason for separation,Employee will not recruit or solicit to hire or assist others in recruiting orsoliciting to hire, any employee of Company with whom Employee had Material Contact,supervised or was integral in the researching and hiring process, and will notcause or assist others in causing any employee of Company to terminate anemployment relationship with Company.  “MaterialContact” means contact which takes place to conduct or further the Company’s business.

 

6.             Severability.  If any provision of this Agreement shall beheld invalid, illegal or otherwise unenforceable, in whole or in part, theremaining provisions, and any partially enforceable provisions to the extentenforceable, shall be binding and remain in full force and effect. Further,each particular prohibition or restriction set forth in any Section ofthis Agreement shall be deemed a severable unit, and if any court of competentjurisdiction determines that any portion of such prohibition or restriction isagainst the policy of the law in any respect, but such restraint, considered asa whole, is not so clearly unreasonable and overreaching in its terms as to beunconscionable, the court or arbitrator shall enforce so much of such restraintas is determined by a preponderance of the evidence to be necessary to protectthe interests of Company.

 

7.             Survival of Covenants.  All rights and covenants contained in Sections3, 4, and 5, of this Agreement, and all remedies relating thereto, shall survivethe termination of this Agreement for any reason.

 

8.             Choice of Law and Venue.  The validity, interpretation, construction,and performance of this Agreement shall be governed by the laws of the State ofGeorgia (excluding any that mandate the use of another jurisdiction’slaws).  Any action to enforce or forbreach of this Agreement shall be brought exclusively in the state or federalcourts of the County of Chatman, City of Savannah.

 

9.             Acknowledgment of Reasonableness/Remedies/Enforcement.

 

(a)           Employeeacknowledges that (1) Company has valid interests to protect pursuant toSections 3, 4, and 5 of this Agreement; (2) her breach of the provisionsof Sections 3, 4 and/or 5 of this Agreement would result in irreparable injuryand permanent damage to Company; and (3) suchrestrictions are reasonable and necessary to protect the interests of Company,are critical to the success of Company’s business, and do not cause unduehardship on Employee.

 

(b)           Employee agrees that determiningdamages in the event of a breach of Sections 3, 4, 5, or 6 by Employee would bedifficult and that money damages alone would be an inadequate remedy for theinjuries and damages which would be suffered by Company from such breach.Employee further agrees that injunctive relief is an appropriate remedy forsuch breach and that in the event of such breach Company, in addition to andwithout 

 

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limiting any otherremedies or rights which it may have, may apply to any court of competentjurisdiction and seek interim, provisional, injunctive, or other equitablerelief.  Employee and Company waive anyrequirement that a bond or any other security be posted.

 

10.           Miscellaneous.  This Agreement and the Employment Agreementbetween the parties constitute the entire agreement between the parties and supersedes any and all prior contracts, agreements,or understandings between the parties which may have been entered intoby Company and Employee relating to the subject matter hereof. This Agreementmay not be amended or modified in any manner except by an instrument in writingsigned by both Company and Employee. The failure of either party to enforce atany time any of the provisions of this Agreement shall in no way be construedto be a waiver of any such provision or theright of such party thereafter to enforce each and every such provision. Nowaiver of any breach of this Agreement shall be held to be a waiver of anyother or subsequent breach. All remedies arecumulative, including the right of either party to seek equitable relief inaddition to money damages.

 

**EMPLOYEEACKNOWLEDGES AND AGREES THAT SHE HAS CAREFULLY READ THIS AGREEMENT AND KNOWSAND UNDERSTANDS ITS CONTENTS, THAT SHE ENTERSINTO THIS AGREEMENT KNOWINGLY AND VOLUNTARILY, AND THAT SHE INDICATES HERCONSENT BY SIGNING THIS FINAL PAGE.**

 

IN WITNESS WHEREOF, theparties hereto have executed this Agreement under seal as of the day and yearfirst above written.

 
|   | CITI TRENDS, INC.   |
|--------|---------------------|
|   |                |
|   | By:                 |   /s/ R. Edward Anderson |
|   | Its:                |   Chief Executive Officer |
|   |                |
|   |                |
|   | EMPLOYEE            |
|   |                |
|   | /s/ Elizabeth Feher |
|   | Elizabeth Feher     |
|   |                |
|   | Employee Residence  |
|   |                |
|   |                |
|   |                |

 

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