Document:

urgi_exh10-4.htm

    

      Kenneth
        Carroll

      Amendment
        to Employment Agreement

      

      This
        document (the “Amendment”) constitutes an amendment to the Employment
        Agreement, as restated on June 15, 2007 (the “Current Agreement”),
        between Kenneth Carroll (the “Executive”) and United Retail Group, Inc.
        (the “Company”), effective as of, and subject to, the occurrence of the
“Acceptance Time” (as such term is defined in the Agreement and Plan of Merger
        (the “Merger Agreement”) by and among Redcats USA, Inc.
        (“Parent”), Boulevard Merger Sub, Inc. and the Company).  To
        the extent this Amendment conflicts with any provision of the Current Agreement
        or addresses subject matters not addressed in the Current Agreement, this
        Amendment shall govern.  Otherwise, the Current Agreement shall remain
        in effect until and unless terminated in accordance with its
        terms.  Capitalized terms that are used and not defined herein shall
        have the meaning set forth in the Merger Agreement.

      

      
        	
                Parties:

                 

              	
                Kenneth
                  Carroll, the Company and Parent.

                 

              
	
                Contract
                  Term:

                 

              	
                Amended
                  to mean the period of  time commencing at the Acceptance
                  Time  and ending on the day that is 90 days after the Acceptance
                  Time (the “End Date”).

                 

              
	
                Transaction
                  Payment

                 

              	
                Payment
                  at Acceptance Time equal to $1,079,163.30.

                 

              
	
                Position
                  & Duties:

                 

              	
                Section
                  3(a) of the Current Agreement shall be amended as
                  follows:

              
	 	
                ·

                 

              	
                The
                  following shall be added at the end of the second sentence of Section
                  3(a)
                  (with the terms “Merger” and “Parent” having the definitions ascribed to
                  them in this Amendment): “, taking into account the Merger and the fact
                  that the Company is no longer a stand-alone publicly traded company.
                  Additionally, the Executive shall assist Parent in the integration
                  of the
                  Company and Parent including, but not limited to, assisting Parent
                  in
                  realizing synergies in connection with the Merger.”

                 

              
	
                Compensation

                 

              	
                ·

                 

              	
                Monthly
                  base salary of $27,550, payable in accordance with the Company’s payroll
                  practice.

              
	 	
                ·

                 

              	
                No
                  semi-annual bonus eligibility.

              
	
                Definition
                  of Cause:

                 

              	
                Section
                  1(f) of the Current Agreement shall be modified as
                  follows:

              
	 	
                ·

                 

              	
                Paragraph
                  (iii) thereof shall be modified to read as follows: “(A) the Executive has
                  willfully and continuously failed to perform his material duties
                  to the
                  Company or (B) the Executive has failed in any material

                 

              

      

      

      
        
          
          

        

        
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                respect
                  to follow specific directions of the President and Chief Executive
                  Officer
                  of Parent or the Chief Executive Officer of the Company in the
                  performance
                  of his duties, in either case of (A) or (B) (i) other than any
                  such
                  failure resulting from the Executive's incapacity due to physical
                  or
                  mental illness and (ii) following delivery of written notice to
                  the
                  Executive from the Board of Parent identifying such failure in
                  detail and
                  identifying the manner in which such failure can be cured (if capable
                  of
                  cure) and the failure of the Executive to cure such failure in
                  the manner
                  so identified within fourteen (14) days following the delivery
                  of such
                  notice;”

              
	 	
                ·

                 

              	
                Paragraph
                  (iv) thereof shall be modified to read as follows: “the Executive has
                  engaged in willful misconduct in the performance of his duties
                  to the
                  Company in any material respect and material economic harm to the
                  Company
                  has resulted.”

              
	 	
                ·

                 

              	
                Paragraph
                  (v) thereof shall be deleted in its entirety.

                 

              
	 	
                The
                  parties hereto agree that any breach (including a material breach)
                  of this
                  Amendment or the Current Agreement by the Executive following the
                  Acceptance Time that does not constitute “Cause” (as modified above) shall
                  not relieve the Company or Parent of its or their obligations under
                  the
                  Current Agreement or this Amendment.

                 

              
	
                Termination:

                 

              	
                ·

                 

              	
                Sections
                  7, 8 and 14(a), (b) (other than for purposes of clause 14(b)(ii),
                  which
                  shall remain in effect as amended below solely for purposes of
                  references
                  thereto in this Amendment), (c), (d) and (e)(ii) (other than (e)(ii)(A),
                  (C) and (D)) of the Current Agreement shall be deleted. Section
                  14(f)(iv)
                  shall remain, and additionally shall be incorporated by reference
                  into
                  Section 14(e)(ii).

              
	 	
                ·

                 

              	
                The
                  reference to Section 4 in clause 14(b)(ii)(A) shall refer to the
                  Executive’s compensation as set forth above.

              
	 	
                ·

                 

              	
                In
                  no event shall the fact that the Company is no longer a stand-alone
                  publicly traded company constitute a breach by the Company for
                  purposes of
                  Section 14(b)(ii) of the Current Agreement.

                 

              
	
                Change
                  of Control:

                 

              	 	
                Section
                  15(d) shall be amended to read in its entirety as set forth on
                  Annex A
                  hereto.

              

      

      

      
        
          
          

        

        
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                Severance:

                 

              	
                ·

                 

              	
                If
                  the Executive remains employed with the Company through the End
                  Date, then
                  the Company shall pay to the Executive, promptly following (but
                  in any
                  event no later than 15 days after) the End Date, a lump sum cash
                  amount
                  (the “Severance Payment”) equal to $539,581.66.

              
	 	
                ·

                 

              	
                The
                  Severance Payment also will be paid upon any cessation of the Executive’s
                  employment prior to the End Date (including, without limitation,
                  as a
                  result of the Executive’s death or Permanent Disability) unless (i) the
                  Executive is terminated by the Company for Cause or (ii) the Executive
                  terminates his employment other than pursuant to Section 14(b)(ii)
                  of the
                  Current Agreement).

              
	 	
                ·

                 

              	
                The
                  Executive shall not be entitled under any circumstances to severance
                  payments or benefits other than the Severance Payment, and only
                  in
                  accordance with the terms set forth above.

                 

              
	
                Transfer
                  of Insurance:

                 

              	
                In
                  the event that the Executive’s employment with the Company terminates on
                  the End Date, or prior to the End Date unless (i) the Executive
                  is
                  terminated by the Company for Cause or (ii) the Executive terminates
                  his
                  employment other than pursuant to Section 14(c)(ii) of the Current
                  Agreement (as amended), then the Company will transfer to the Executive
                  ownership of all term life insurance policies (including any “key man”
                  policies) insuring the life of the Executive and then held by the
                  Company;
                  provided, that (i) such transfer is allowed under the terms of
                  the
                  applicable policies and (ii) the Executive shall pay any costs
                  incurred in
                  connection with such transfer.

                 

              
	
                No
                  Mitigation; No Offset:

                 

              	
                ·

                 

              	
                The
                  Executive shall be under no obligation to seek other employment
                  and there
                  shall be no offset against any amounts due the Executive under
                  this
                  Amendment or the Current Agreement on account of any remuneration
                  attributable to any subsequent employment that the Executive may
                  obtain.
                  Additionally, amounts owed to the Executive under this Amendment
                  or the
                  Current Agreement shall not be offset by any claims the Company
                  or Parent
                  may have against the Executive.

              
	 	
                ·

                 

              	
                Section
                  14(e)(i) of the Current Agreement shall be deleted and replaced
                  with the
                  preceding bullet.

              

      

      

      
        
          
          

        

        
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                Restrictive
                  Covenants:

                 

              	
                ·

                 

              	
                The
                  Executive shall be bound by the provisions of Sections 11(a) and
                  (d) of
                  the Current Agreement, during the Contract Term and for 36 months
                  thereafter; provided, however, that in the event of a termination
                  of
                  employment pursuant to which the Executive is entitled to receive
                  Severance, the Executive shall be bound by the provisions of such
                  Sections
                  11(a) and (d) only in the event that the Company shall timely remit
                  the
                  Severance Payment.

              
	 	
                ·

                 

              	
                Section
                  11(e) of the Current Agreement shall be deleted and replaced with
                  the
                  preceding bullet.

                 

              
	
                Section
                  409A:

                 

              	
                This
                  Amendment is intended to comply with the requirements of Section
                  409A of
                  the Internal Revenue Code of 1986, as amended, (the "Code"), and
                  the
                  regulations and guidance issued thereunder, and shall be interpreted
                  in a
                  manner consistent therewith.  In the event the parties determine
                  in good faith that there is a reasonable likelihood that any portion
                  of
                  this Amendment does not comply with final regulations or other
                  guidance
                  under Section 409A, the parties agree that they shall further amend
                  this
                  agreement and that such amendment shall be drafted in compliance
                  with
                  Section 409A, but in such manner as will preserve the terms and
                  intent of
                  this Amendment to the extent reasonably possible and in such a
                  manner that
                  will not result in a material negative economic impact to the Company
                  or
                  the Executive.

                 

              
	
                Other
                  Definitions:

                 

              	
                ·

                 

              	
                “Affiliated
                  Companies” shall mean, with respect to the Company, any corporation,
                  limited partnership, general partnership, association, joint-stock
                  company, joint venture, trust, bank, trust company, land trust,
                  business
                  trust, fund or any organized groups of persons, whether or not
                  a legal
                  entity, that is directly or indirectly controlled by, controlling
                  or under
                  common control with the Company.

                 

              
	 	
                ·

                 

              	
                “Business
                  of the Company” shall mean the operation of a retail operation which
                  markets and sells apparel for women principally in sizes 14 and
                  larger and
                  any other future business in which the Company and its subsidiaries
                  and
                  Affiliated Companies engage that produces more than 10% of the
                  Company’s
                  or Parent’s consolidated sales.

                 

              
	
                Compensation
                  Arrange-

                 

              	
                The
                  Company represents and warrants to Parent and the Executive that
                  the
                  Compensation Committee of the Board

              

      

      

      
        
          
          

        

        
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                ment

                 

              	
                of
                  Directors of the Company, consisting solely of independent directors,
                  has
                  approved by resolution the Employment Agreement and this Amendment
                  and the
                  transactions contemplated thereby and hereby as an employment
                  compensation, severance or other employee benefit arrangement,
                  in
                  accordance with the requirements of Rule 14d-10(d)(2) under the
                  Securities
                  Exchange Act of 1934 and the instructions thereto.

                 

              
	 	 	 
	
                Notices

                 

              	
                Section
                  21 of the Current Agreement shall be amended to read in its entirety
                  as
                  follows:

              
	 	 	
                “all
                  notices, requests and other communications to any party hereunder
                  shall be
                  in writing and shall be deemed given if delivered personally, or
                  sent by
                  overnight courier (providing proof of delivery) to the parties
                  at the
                  following addresses:

                 

              
	 	 	
                If
                  to Parent or the Company, to:

                Redcats
                  USA, Inc.

                463
                  Seventh Avenue

                New
                  York, NY 10018

                Attention:  Chief
                  Executive Officer

                 

              
	 	 	
                with
                  a copy (which shall not constitute notice) to:

                Wachtell,
                  Lipton, Rosen & Katz

                51
                  West 52nd Street

                New
                  York, New York 10019

                Attention:  Michael
                  J. Segal, Esq.

                 

              
	 	 	
                If
                  to the Executive, to the address of the Executive most recently
                  on the
                  books and records of the Company

                 

              

      

      

      
        
          
          

        

        
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      By
        signing below, the parties hereto agree to be bound by the terms of this
        Amendment as described above.

       

      Signed,

       

      
        	 	
                Redcats
                  USA, Inc.

                 

              
	
                By:

              	/s/
                Kenneth P. Carroll	
                By:

              	/s/
                Faintreny Eric
	 	
                Kenneth
                  Carroll

              	 	
                Name:
                  Faintreny Eric

              
	 	
                 

                United
                  Retail Group, Inc.

                 

              
	 	
                By:

              	/s/
                Raphael Benaroya
	 	
                Name:
                  Raphael Benaroya

                           
                  Chairman, President and

                           
                  Chief Executive Officer

              

      

      

      

      Date:
        September 10, 2007

      
        
          
          

        

        
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      ANNEX
        A

      

      In
        the event that any payment or benefit received or to be received by Executive
        pursuant to the terms of the Current Agreement or this Amendment (the
        "Contract Payments") or in connection with the Executive's termination of
        employment or contingent upon a Change of Control of the Company pursuant
        to any
        plan or arrangement or other agreement with the Company (or any affiliate)
        ("Other Payments" and, together with the Contract Payments, the
        "Payments") would be subject to the excise tax (the "Excise Tax")
        imposed by Section 4999 of the Code, as determined as provided below, the
        Company shall pay to Executive, at the time specified below, an additional
        amount (the "Gross-Up Payment") such that the net amount retained by the
        Executive, after deduction of the Excise Tax on the Payments and any federal,
        state and local income or other tax and Excise Tax upon the payment provided
        for
        by this paragraph, and any interest, penalties or additions to tax payable
        by
        the Executive with respect thereto, shall be equal to the total value of
        the
        Payments at the time such Payments are to be made.  All financial
        determinations required to be made under this Annex A, including whether
        and
        when a Gross-Up Payment is required, the amount of such Gross-Up Payment
        and the
        assumptions to be utilized in arriving at such determination, shall be made
        by a
        nationally recognized certified public accounting firm designated by the
        Company
        and reasonably acceptable to the Executive (the “Accounting
        Firm”).  The Accounting Firm shall provide detailed supporting
        calculations both to the Company and the Executive within 15 business days
        of
        the receipt of notice from the Executive that there has been a Payment or
        such
        earlier time as is requested by the Company.  All fees and expenses of
        the Accounting Firm shall be borne solely by the Company.  Any
        determination by the Accounting Firm shall be binding upon the Company and
        the
        Executive.  For purposes of determining the amount of the Gross-Up
        Payment, the Executive shall be deemed to pay federal income tax at the highest
        marginal rates of federal income taxation applicable to individuals in the
        calendar year in which the Gross-Up Payment is to be made and state and local
        income taxes at the highest effective rates of taxation applicable to
        individuals as are in effect in the state and locality of the Executive's
        residence or place of employment in the calendar year in which the Gross-Up
        Payment is to be made, net of the maximum reduction in federal income taxes
        that
        can be obtained from deduction of such state and local taxes, taking into
        account any limitations applicable to individuals subject to federal income
        tax
        at the highest marginal rates.

       

      The
        Gross-Up Payments provided for in the preceding paragraph shall be made prior
        to
        the imposition upon the Executive or payment by the Executive of any Excise
        Tax.

       

      The
        Executive shall notify the Company in writing of any claim by the Internal
        Revenue Service that, if successful, would require the payment by the Company
        of
        a Gross-Up Payment. Such notification shall be given as soon as practicable
        but
        no later than 30 days after the Executive is informed in writing of such
        claim and shall apprise the Company of the nature of such claim and the date
        on
        which such claim is requested to be paid.  The Executive shall not pay
        such claim prior to the expiration of the 30 day period following the date
        on
        which the Executive gives such notice to the Company (or such shorter period
        ending on the date that any payment of taxes with respect to such claim is
        due).
        If the Company notifies the Executive in writing prior to the expiration
        of such
        period that it desires to contest such claim, the Executive shall:

       

      give
        the Company any information reasonably requested by the Company relating
        to such
        claim;

       

      
        
          
          

        

        
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      take
        such action in connection with contesting such claim as the Company shall
        reasonably request in writing from time to time, including, without limitation,
        accepting legal representation with respect to such claim by an attorney
        reasonably selected by the Company and reasonably satisfactory to the
        Executive;

       

      cooperate
        with the Company in good faith in order to effectively contest such claim;
        and

       

      permit
        the Company to participate in any proceedings relating to such
        claim;

       

      provided,
        however, that the Company shall bear and pay directly all costs and
        expenses (including, but not limited to, additional interest and penalties
        and
        related legal, consulting or other similar fees) incurred in connection with
        such contest and shall indemnify and hold the Executive harmless, on an
        after-tax basis, for any Excise Tax or other tax (including interest and
        penalties with respect thereto) imposed as a result of such representation
        and
        payment of costs and expenses.

       

      The
        Company shall control all proceedings taken in connection with such contest and,
        at its sole option, may pursue or forego any and all administrative appeals,
        proceedings, hearings and conferences with the taxing authority in respect
        of
        such claim and may, at its sole option, either direct the Executive to pay
        the
        tax claimed and sue for a refund or contest the claim in any permissible
        manner,
        and the Executive agrees to prosecute such contest to a determination before
        any
        administrative tribunal, in a court of initial jurisdiction and in one or
        more
        appellate courts, as the Company shall determine; provided,
however, that if the Company directs the Executive to pay such claim
        and
        sue for a refund, the Company shall advance the amount of such payment to
        the
        Executive on an interest-free basis, and shall indemnify and hold the Executive
        harmless, on an after-tax basis, from any Excise Tax or other tax (including
        interest or penalties with respect thereto) imposed with respect to such
        advance
        or with respect to any imputed income with respect to such advance; and
provided, further, that if the Executive is required to extend the
        statute of limitations to enable the Company to contest such claim, the
        Executive may limit this extension solely to such contested amount. The
        Company's control of the contest shall be limited to issues with respect
        to
        which a Gross-Up Payment would be payable hereunder and the Executive shall
        be
        entitled to settle or contest, as the case may be, any other issue raised
        by the
        Internal Revenue Service or any other taxing authority. In addition, no position
        may be taken nor any final resolution be agreed to by the Company without
        the
        Executive's consent if such position or resolution could reasonably be expected
        to adversely affect the Executive (including any other tax position of the
        Executive unrelated to the matters covered hereby).

       

      As
        a result of the uncertainty in the application of Section 4999 of the Code
        at
        the time of the initial determination by the Company or the Tax Counsel
        hereunder, it is possible that Gross-Up Payments which will not have been
        made
        by the Company should have been made ("Underpayment"), consistent with the
        calculations required to be made hereunder. In the event that the Company
        exhausts its remedies and the Executive thereafter is required to pay to
        the
        Internal Revenue Service an additional amount in respect of any Excise Tax,
        the
        Company or the Tax Counsel shall determine the amount of the Underpayment
        that
        has occurred and any such Underpayment shall promptly be paid by the Company
        to
        or for the benefit of the Executive.

       

      
        
          
          

        

        
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      The
        Executive shall file his tax returns in a manner consistent with the position
        taken by the Company in respect of the matters described in this Annex
        A.

       

      
        
          
          

        

        
          -
            9
            -urgi_exh10-5.htm

    

    SECOND
      AMENDMENT TO THE AMENDED AND RESTATED

     

    UNITED
      RETAIL GROUP

     

    SUPPLEMENTAL
      RETIREMENT SAVINGS PLAN

     

    RECITALS

     

    United
      Retail Group, Inc. (the “Company”) maintains for the benefit of its employees
      the United Retail Group Supplemental Retirement Savings Plan, as amended (the
      “Plan”).

     

    The
      Company adopted, effective as of June 27, 2005 an amendment and restatement
      of
      the Plan and subsequently amended it by a First Amendment dated August 29,
      2005.

     

    The
      Company now wishes to add a provision to the Plan.

     

    Therefore,
      this Second Amendment to the amended and restated Plan shall be adopted
      effective as of the date of its adoption by the Board.

     

    AMENDMENT

    

    
      	
              1.

            	
              A
                new Section 7.11 is added to the Plan to read in its entirety as
                follows:

            

    

    

    Notwithstanding
      any provision of the Plan to the contrary, in accordance with rules established
      by the Administrative Committee in accordance with Section 409A of the Code,
      each Participant shall be permitted to elect, not later than December 31, 2007,
      in a form and manner acceptable to the Administrative Committee, that their
      benefits under the Plan (to the extent not attributable to 409A Deferrals)
      shall
      be distributable to them, in a lump sum or ten annual installment payments
      in
      accordance with the otherwise applicable terms of the Plan, on either their
      "separation from service" within the meaning of Section 409A of the Code or
      a
      date certain not earlier than January 1, 2008 and specified by the
      Participant.  Nothing in this Section 7.11 shall affect a
      Participant's right to a distribution upon death, a Change in Control, or the
      occurrence of an Unforeseeable Emergency in accordance with the otherwise
      applicable provisions of the Plan.

    

    2.           In
      all other respects, the Plan shall remain unchanged.

    

    Dated
      this 10th day of September, 2007.

    

    
      	 	
              UNITED
                RETAIL GROUP, INC.

            
	 	 	 
	 	 	 
	 	
              By:

            	
              
                /s/
                  Kenneth Carroll

              

            
	 	
              Kenneth
                Carroll

            
	 	
              Title:

            	
              Senior
                Vice President-General

            
	 	 	
              Counsel
                and Secretary

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