Exhibit 10.86


 


February 12, 2010


 


Susan J. Riley


424 East 52nd Street


New York, New York 10022


 


Dear Ms. Riley:


 


Reference is made to your
Employment Agreement with The Children’s Place Retail Stores, Inc. (the “Company”)
dated as of February 4, 2007, as amended by that certain Amendment to
Employment Agreement dated as of the 31st day of
December, 2008 (the “Employment Agreement”).  All terms used herein and not otherwise
defined shall have that meaning set forth in the Employment Agreement.


 


Please be advised that if
you are employed by the Company through March 31, 2010, then you will be
entitled to receive from the Company a lump sum payment of $1,000,000.  If you are employed by the Company through March 31,
2011, then you will be entitled to receive from the Company an additional lump
sum payment of $1,000,000.   Each such
payment shall be made within two days following March 31, 2010 and March 31,
2011, respectively.


 


If, on or before March 31,
2010, your employment with the Company terminates under the circumstances set
forth in Section 6.01 of your Employment Agreement, then you shall be
entitled to receive from the Company a lump sum payment of $2,000,000 in lieu
of the payments set forth in Section 6.01 of your Employment Agreement
(but not in lieu of any amounts or benefits under Sections 6.03 or 6.04 of your
Employment Agreement).  Such payment
shall be made within two days following March 31, 2010.


 


If, subsequent to March 31,
2010 but on or before March 31, 2011, your employment with the Company terminates
under the circumstances set forth in Section 6.01 of your Employment
Agreement, then you shall be entitled to receive from the Company the sum of
$1,000,000 in lieu of the payments set forth in Section 6.01 of your
Employment Agreement (but not in lieu of any amounts or benefits under Sections
6.03 or 6.04 of your Employment Agreement).  
To the extent such amount does not exceed the amount of continued Base
Salary that would have been payable under clause (1) of Section 6.01
of your Employment Agreement, such amount


 

















 


Susan J. Riley


February 12, 2010


Page 2 of 3


 


shall be payable in
accordance with the Company’s normal payroll practices over a period of 12
months from the effectiveness of your general release of claims, as set forth
below.  To the extent such amount exceeds
the cumulative amount of continued Base Salary that would have been payable
under clause (1) of Section 6.01 of your Employment Agreement, such
amount shall be payable in a lump sum at the same time as the payment in
respect of the Performance Bonus as set forth in Section 6.01 of your
Employment Agreement would have been paid.


 


If, subsequent to March 31,
2011, your employment with the Company terminates under the circumstances set
forth in Section 6.01 of your Employment Agreement, then you shall be
entitled to receive from the Company the payments set forth in Section 6.01
of your Employment Agreement in accordance with the terms thereof.


 


All payments to be made
pursuant to this Letter Agreement shall be made in such matter as is
contemplated in your Employment Agreement. 
This Letter Agreement is intended to comply with Section 409A of
the Code and the regulations thereunder such that no payment made, or benefit
provided, to you hereunder shall be subject to an “additional tax” within the
meaning of Section 409A of the Code. 
The Company is authorized to withhold from any payment to be made
hereunder to you such amounts for income tax, social security, unemployment
compensation, excise taxes and other taxes and penalties as in the Company’s
judgment is required to comply with applicable laws and regulations.


 


Notwithstanding anything in
this Letter Agreement to the contrary, if you are a “specified employee”
(determined in accordance with Section 409A of the Code and Treasury
Regulation Section 1.409A-3(i)(2)) as of the termination of your
employment with the Company, and if any payment, benefit or entitlement
provided for in this Letter Agreement or otherwise both (i) constitutes a “deferral
of compensation” within the meaning of Section 409A of the Code and (ii) cannot
be paid or provided in a manner otherwise provided herein or otherwise without
subjecting you to additional tax, interest and/or penalties under Section 409A
of the Code, then any such payment, benefit or entitlement that is payable
during the first six months following the date of your termination of
employment shall be paid or provided to you (or your estate, if applicable) in
a lump sum cash payment (together with interest on such amount during the
period of such restriction at a rate, per annum, equal to the applicable
federal short-term rate (compounded monthly) in effect under Section 1274(d) of
the Code on the date of termination) on the earlier of (x) your death or (y) the
first business day of the seventh calendar month immediately following the
month in which your termination of employment occurs.


 


Payments of the amounts
specified in this Letter Agreement are subject to your execution of a general
release in the form attached as Exhibit B to your Employment
Agreement (the “Release”) within 21 days following your termination of
employment (or such longer period if and to the extent required under
applicable law).  For purposes of this
Letter Agreement and any other amounts payable under your Employment Agreement
that are subject to your


 

















 


Susan J. Riley


February 12, 2010


Page 3 of 3


 


execution of a Release, if
the maximum applicable review and revocation period of the Release commences in
one calendar year and expires in the subsequent year, the commencement of such
payments shall in any event occur immediately following the later of January 1
of such subsequent year or the effective date of the Release.


 


Other than as amended by
this letter agreement, the terms of the Employment Agreement remain unchanged.  This agreement shall be effective for all
purposes as of January 20, 2010.


 


Very truly yours,


 


THE CHILDREN’S PLACE RETAIL
STORES, INC.


 


 


	
  By:

  	
  /s/ Jane T. Elfers

  	
   

  
	
   

  	
  Jane T. Elfers, President
  and Chief Executive Officer

  	
   

  



 


 


Agreed to and acknowledged
on this 12th day of February, 2010


 


 


	
  /s/ Susan J. Riley

  	
   

  
	
  Susan J. Riley