Exhibit 10.49


 


Execution Copy


THE
CHILDREN’S PLACE RETAIL STORES, INC.


INTERIM
CHIEF EXECUTIVE OFFICER


	
  A.

  	
  Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.  Effective Date

  	
   

  	
  The Effective Date shall be the date on which both
  (i) Board approval of the terms set forth in this term sheet has been
  obtained and (ii) the Term Sheet has been duly executed by both parties. From
  and after the Effective Date, this Term Sheet shall be binding and
  enforceable as to the rights and obligations set forth herein, until superseded
  by definitive employment and other appropriate documentation as necessary to
  carry out the understandings set forth herein.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.  Position

  	
   

  	
  Interim Chief Executive Officer (“Executive”).

   

  Executive will continue as a member of the Board.

   

  Executive to be based at headquarters of TCP (the
  “Company”).

   

  Executive to have all duties and responsibilities
  customarily held by a chief executive officer of a public company of like
  size to the Company.

   

  All senior executive officers shall report to
  Executive, provided that, as currently, the Executive Vice President-Finance
  and Administration shall report jointly to Executive and Board. 

   

  Executive to report solely to the Board.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.  Employment Term; Consulting Term;
  Further Agreement

  	
   

  	
  From September 26, 2007 (“Start Date”) until
  February 2, 2009 or until such earlier time as a new permanent Chief
  Executive Officer has been appointed and commenced employment. The employment
  term will be followed by a consulting term extending for the following two
  calendar months, during which Executive will assist in the transition of the
  responsibilities of the Chief Executive Officer; for the period ending at the
  end of the first month on a substantially full-time basis but in the second
  month Executive shall not be required to provide his consulting services on
  more than a half-time basis. For his consulting services, Executive shall
  receive a consulting fee per month equal to the full salary per month he
  would have received as an employee and

  



 













 


	
  

  	
   

  	
   

  	
  shall be entitled to continuation of all benefits to
  which he was entitled during his employment term except as prohibited by any
  benefit plan to be so extended (“Minimum Consulting”). 

   

  Executive may terminate his employment without Good
  Reason on 30 days’ written notice to the Company; the Board may terminate his
  employment without Cause upon 30 days written notice to Executive and may
  terminate his employment for Cause at any time but subject to the provisions
  of Exhibit A.

   

  The Company and Executive will promptly enter into
  definitive employment and equity award agreements reflecting terms consistent
  with this term sheet, at which time such agreements shall supersede this Term
  Sheet.

  
	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
  On-Going

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.  Base Salary

  	
   

  	
  $1,000,000 per annum. In all events salary payments
  will be made for a minimum of six months (through March 2008), even if the
  employment period ends earlier (“Minimum Salary”).

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.  Annual Bonus

  	
   

  	
  For the year starting 2/1/08, participation in the
  Company’s Annual Management Incentive Bonus Program for such year, on the
  same terms, including performance criteria, as other senior executives
  participate in the program but with (i) a target bonus amount equal to 100%
  of annual Base Salary (“Target Bonus”) and (ii) a maximum bonus opportunity
  for extraordinary performance of not less than the maximum bonus opportunity,
  when expressed as a percentage of target bonus opportunity, provided under
  the Company’s annual bonus plan for any other senior executive. If employment
  terminates prior to 2/3/09, bonus to be pro-rated through date of
  termination, but with no requirement that Executive be employed at the year
  then ended or thereafter, other than in the event of a termination for Cause
  or by Executive without Good Reason before expiration of the employment
  period. Award shall be based on level of attainment of corporate performance
  criteria for the fiscal year ended 2/3/09, as determined by the Compensation
  Committee in good faith in accordance with the terms of the Plan and on the
  same basis as determined for other senior

  



 



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  executives. (the arrangements described herein are
  referred to as “Annual Bonus”)

  
	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
  Other
  Compensation

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.  Equity
  Award

  	
   

  	
  As soon as practicable after Company is legally able
  to resume making equity awards, and whether or not Executive’s employment has
  then terminated, the Company will make a restricted share grant to Executive
  pursuant to which it will issue shares in the name of the Executive, subject
  to vesting as provided below, having a grant date value (determined in
  accordance with the valuation practices for such awards customarily used by
  the Company) of $1,000,000. All shares of restricted stock covered by this
  grant will be held by the Company in escrow the name of Executive and will be
  released from escrow as and when vesting occurs, net of required withholding
  for taxes, which will be satisfied by withholding of shares having a closing
  trading price on the vesting date equal to the taxes required to be withheld.

   

  Vesting shall occur ratably over 36 months based on
  (i) his months of employment with the Company from October 1, 2007 through
  Executive’s date of termination of employment and (ii) unless Executive’s
  employment has been terminated by the Company for Cause or by Executive
  without Good Reason, his post-employment service as a director of the
  Company. Notwithstanding the forgoing, upon a Change in Control during such
  36 month period or, if Executive is not nominated for election to the Board,
  or, if nominated, is not elected, during any part of such period, the
  remaining unvested portion of such award shall become fully vested.

   

  Notwithstanding vesting, no such shares shall be
  saleable until the earliest to occur of (i) January 31, 2010, the first day of
  fiscal 2010, (ii) one year after the Executive’s termination of employment
  for any reason, or (iii) the date on which such restricted stock grant has
  become fully vested for any reason.

   

  The Company shall cooperate with Executive so that
  he has the opportunity to take whatever actions are necessary on a timely
  basis to receive the same consideration with respect to the restricted shares
  as 

  



 



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  other stockholders receive with respect to their
  shares at the Closing of a Change in Control transaction.

   

  “Change in Control” shall have the meaning provided
  in the Company’s equity plan as in effect on the Start Date.

   

  The number of restricted shares to be issued to
  Executive at each vesting event shall be reduced by the number of shares
  having a value at the time of vesting equal to the minimum amount required to
  be withheld for Federal, state and local income taxes.

   

  The restricted shares once vested shall not be
  subject to any restrictions on transfer, except for such as may apply under
  the securities laws or the Company’s securities trading policies or as may
  apply before the first day of fiscal 2010 as described above. 

   

  The Equity Award shall be in addition to any equity
  compensation due under the Company’s normal non-employee director
  compensation program with respect to continued post-employment services as a
  director.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.  Benefits, Perquisites and
  Indemnification.

  	
   

  	
  Executive will participate in all executive benefit
  plans, and will be provided substantially the same benefits and perquisites,
  from time to time maintained by the Company for senior executives, except
  that additional incentive awards will not be provided and, in lieu of the
  Company providing a car to Executive, the Company will provide Executive with
  (or reimburse Executive for) a car service to/from Manhattan to the Company’s
  offices on an as-needed and reasonable basis.

   

  In addition to and without limitation upon
  Executive’s rights to indemnification as they existed immediately prior to
  the Start Date, Executive shall at all times during the Term, and thereafter
  in respect of actions taken, or not taken, by Executive during the Term, be
  entitled to indemnification, fee advancement to the maximum extent permitted
  by law and the Company’s charter and by laws as in effect on the Start Date,
  or thereafter to the extent any greater protections are implemented, and
  coverage under policies of directors and officers liability insurance during
  Executive’s employment to the same extent provided for other senior executives
  and after Executive’s employment terminated to the same extent provided for
  former

  



 



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  senior executives. Executive’s Indemnification
  rights shall survive any termination of employment for any reason. (such
  rights, collectively, “Indemnification”)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.  Relocation Allowance.

  	
   

  	
  Temporary living allowance for New York City
  apartment selected by Executive at $15,500 per month (which has already been
  selected and leased for a one year term), plus payment by Company of any
  commissions, security deposit, utilities and the like due under or related to
  the lease, plus a furniture rental allowance of $2,000 per month, in each
  case for the period of his employment and the consultancy period referred to
  below (“Rental Costs”) and the Company will also be responsible for, and hold
  Executive harmless against any lease termination costs (“Lease Termination
  Costs”). Executive shall be entitled to occupy the specified apartment until
  termination of the employment and consultancy period.

   

  Round trip airfare to permanent residence for two
  trips per month through 2007 calendar year end and one trip per month
  thereafter through end of term.

   

  The Company will also make “gross up” payments to
  Executive sufficient to cover all income and employment taxes Executive will
  owe as a result of relocation allowance payments or gross up payments made
  with respect thereto.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.  Post-employment Benefits

  	
   

  	
  (i)    In addition to the Minimum Salary (if
  applicable) and Minimum Consulting payments referred to earlier, if
  Executive’s employment ends before February 2, 2009, the Company will
  continue to provide Executive through such date the same health insurance
  benefits he is entitled to during his employment. 

   

  (ii)   Upon termination of Executive’s employment
  the Company will also be responsible for all of its” Accrued Obligations” to
  Executive, comprised of (A) Base Salary and accrued and unused PTO through
  the date of termination, (B) any Annual Bonus when payable in accordance with
  the plan, (C) all accrued and vested benefits under employee benefit
  (including 401(k)) and welfare plans in which Executive participates, in
  accordance with applicable plan terms, (D) unreimbursed business expenses
  incurred through the termination date, in 

  



 



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  accordance with Company
  business expense reimbursement policy, plus unreimbursed Rental Costs, and
  (E) continued Indemnification rights, with respect to acts or omissions
  occurring prior to date of termination.

   

  Executive, upon termination of employment, shall
  provide the Company a release of all claims against the Company in the form
  customarily provided to the Company by departing Executives, provided that
  such release shall in no event require release of any rights to
  Indemnification, or to defend or pursue counterclaims against any person or
  entity which has brought claims against Executive on or prior to date of
  Release or require continued services of any nature without compensation
  consistent with the rates set forth herein.

   

  “Cause” and “Good Reason” are defined on
  Attachment A.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.  Termination for Cause; Quit without
  Good Reason

  	
   

  	
  Accrued Obligations.

   

  Retain vested equity awards.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.  Restrictive Covenants

  	
   

  	
  Following termination of employment, except for the
  stipulated limitations previously agreed upon by counsel, Executive will be
  subject to substantially the same (i) confidentiality and (ii)
  non-competition and non-solicitation restrictions as apply under the
  Company’s form of agreement used in connection with its 2005-2007 performance
  share plan, for a term not in excess of one year in the case of the
  obligations under clause (ii).

  
	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
  General

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.  Disputes

  	
   

  	
  All disputes will be resolved through binding
  arbitration to be conducted in New York City in accordance with the rules,
  and under the auspices, of JAMS Endispute. The Company (or successor) will
  pay all arbitration fees and all of Executive’s reasonable legal expenses if
  Executive prevails on at least one material issue in dispute, as determined
  by the arbitrator. This obligation shall survive any termination of
  employment. All agreements to be governed by New York law

  



 



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  2.  Legal fees

  	
   

  	
  Executive’s reasonable legal and consulting fees in
  connection with the preparation of this Term Sheet and related employment
  documentation shall be reimbursed by the Company at his counsel’s standard
  hourly rates promptly upon presentation of a customary invoice.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.  Code Section 409A

  	
   

  	
  Amounts payable and benefits provided under these
  terms will be structured in a manner to comply with Code Section 409A while
  preserving the economic benefit for the Executive to the maximum extent so
  permitted.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.  Mitigation;Offset

  	
   

  	
  No Mitigation.

   

  No Company offset of amounts owed to Executive by
  amounts owed by Executive.

  



 


This
Term Sheet and Attachment A annexed have been entered into this    
day of November, 2007.


 


	
  

  	
   

  	
  THE CHILDREN’S PLACE

  
	
  

  	
   

  	
  RETAIL STORES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  CHARLES CROVITZ

  	
   

  	
   

  	
  Sally Frame Kasaks,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Acting Chair of the Board

  
								



 



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ATTACHMENT A


“Cause”
shall mean any of the following:


(i)                Executive engaging
in an act of willful misconduct that has a material adverse impact on the
reputation, business, business relationships or financial condition of the
Company;


(ii)             Executive’s
conviction of, or plea of guilty or nolo contendere to, a felony, or any crime
involving moral turpitude not involving a traffic offense;


(iii)          Executive’s willful
refusal to perform the specific lawful directives of the Board which are
consistent with the scope of Executive’s duties and responsibilities hereunder.


provided, however, that
no action taken by Executive in the reasonable, good faith belief that it was
in the best interests of the Company shall be treated as a basis for
termination of Executive’s employment for Cause under clause (i) above, and no
failure of Executive or the Company to achieve performance goals, alone, shall
be treated as a basis for termination of Executive’s employment for Cause under
clause (i) or (iii) above.  In connection
with any termination for Cause, the Executive shall be given a statement of the
specific reasons constituting the grounds for termination for Cause and shall
have the right to appear before the Board (with counsel) to respond to
allegations of any actions allegedly constituting Cause prior to any
termination by the Board with Cause becoming effective and no such termination
shall be effective for such purpose unless a majority of the Board determines,
in a meeting duly called for such purpose, that Cause for such termination
exists; it being understood that the foregoing shall not prevent Board from (i)
removing Executive from office or terminating Executive’s position and services
as Interim CEO at any time for any reason, subject in the event of a
termination for Cause to continued payment of salary and benefits until the
Board proceeding and requisite Board determination has occurred.


“Good
Reason” shall mean any of the following:


(i)                Any material
breach of this Agreement by the Company (where the Company fails to cure such
breach within ten (10) business days after being notified in writing by
Executive of such breach);


(ii)             The diminution,
without Executive’s written consent, of Executive’s position, title, authority,
duties or responsibilities as indicated in the Employment Agreement, or the
formal or tacit appointment of any other person, whether or not an Employee of
the Company, without Executive’s written consent, to perform any material part
of such duties, or to exercise any of such responsibilities, including without
limitation, the failure of Executive to have any part of such authorities,
duties and responsibilities as are set forth in Section 2 hereof; provided,
however, that another executive may be authorized by the Board to carry out
such duties and responsibilities if Executive by reason of temporary disability
is unable to perform such duties or responsibilities.



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(iii)          Executive not being
elected as a member of the Board by the Company’s shareholders or being removed
from the Board without cause in accordance with the Company’s bylaws; and


(iv)         The failure by the
Company to obtain the assumption in writing of its obligation to perform under
the Agreement by any successor to all or substantially all of the assets of the
Company.


Executive may terminate
his employment for Good Reason by providing the Company thirty (30) days’
written notice setting forth in reasonable specificity the event that
constitutes Good Reason, within ninety (90) days of the occurrence of such
event.  During such thirty (30) day
notice period, the Company shall have the opportunity to cure (if curable) the
event that constitutes Good Reason, and if not cured within such period, Executive’s
termination will be effective upon the expiration of such cure period.



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