Document:

exv10w69

 

Exhibit 10.69

SEVERANCE AGREEMENT

     This Severance Agreement (the “Agreement”) is made as of the later of December 17, 2007 and
the Executive’s employment commencement date, between The Talbots, Inc., a Delaware corporation
(together with its subsidiaries, the “Company”) and Basha Cohen (the “Executive”). This Agreement
sets forth the agreement of the parties relating to the severance arrangements for the Executive
under certain circumstances. Capitalized terms used in this Agreement are defined in Section 7
hereof.

     1. Severance Pay and Associated Benefits Upon a Qualified Termination.

          (a) Severance Benefits. In the event of a Qualified Termination, and subject to the
terms of this Agreement, the Company will provide to the Executive the payments and benefits
described in this Section 1 (collectively, the “Severance Benefits”).

          (b) Severance Pay. Subject to the terms of this Agreement, in the event of a
Qualified Termination, the Company will pay to the Executive severance pay in the gross amount
equal to 1.5 times the Executive’s annual base salary in effect immediately prior to such
termination (the “Severance Payment”), payable in equal installments in accordance with normal
Company payroll practices over a 18 month period beginning immediately following the Termination
Date (the “Severance Period”).

          (c) Benefits Continuation. Subject to the terms of this Agreement, upon any such
Qualified Termination, the Company will also arrange for the Executive to continue to participate
(through COBRA or otherwise), on substantially the same terms and conditions as in effect for the
Executive (including any required employee contribution) immediately prior to such termination, in
the medical and dental programs provided to the Executive immediately prior to such termination
until the earlier of (i) the end of the Severance Period, or (ii) such time as the Executive is
eligible to be covered by comparable benefits of a subsequent employer. The Executive agrees to
notify the Company promptly if and when the Executive begins employment with another employer and
if and when the Executive becomes eligible to participate in any benefit or other welfare plans,
programs or arrangements of another employer. Executive agrees that any automobile/housing
allowance or other personal benefits provided by the Company to the Executive immediately prior to
such termination will cease as of the Termination Date. The Company, however, may choose to make
any separate arrangements with the Executive to assist with the transfer of any such benefits.

          (d) Retirement Benefits. Nothing in this Agreement will modify or otherwise limit any
of the Executive’s rights and benefits as may exist under the terms of any qualified, nonqualified
or supplemental retirement, 401(k), savings or deferred compensation plans of the Company
(excluding any severance or severance compensation plans) (“Retirement Plans”), nor will any
benefits or amounts payable under any such Retirement Plans reduce or offset any Severance Benefits
afforded to the Executive under this Agreement.

          (e) Equity Awards.

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               (i) If in the event of a Qualified Termination the Executive still holds one or more options
to purchase shares of Company stock which have not expired and have not been fully exercised, the
Executive, at any time within 3 years after the Termination Date (but in no event after the option
has expired), may exercise any such options with respect to any shares as to which the Executive
could have exercised the options on the Termination Date.

               (ii) The Executive agrees that until the expiration of 6 months from the Termination Date, the
Executive will not engage in the purchase or sale of the Company’s common stock (including without
limitation any “cashless exercise” of any stock options involving the sale of any Company common
stock as part of such option exercise) during any trading window “blackout” or “quiet period”
applicable to management level employees (“Quiet Period”). The Executive acknowledges that the
Company reserves the right to modify the Quiet Period from time to time in its sole and absolute
discretion. The Company will provide the Executive with notice of Quiet Periods and changes
thereto at the time it provides such notice to the Company’s management level employees. In
addition, the Executive agrees to notify the Company’s General Counsel prior to exercising any
options or trading in the Company’s common stock within such 6 month period following the
Termination Date to ascertain whether such transaction would violate any Quiet Period covered by
this subsection (e)(ii).

               (iii) Except as otherwise expressly set forth in any agreement between the Executive and the
Company relating to any restricted stock or performance accelerated restricted stock award, in the
event of a Qualified Termination or other termination of employment, the Executive agrees that the
Company will be deemed to have exercised its repurchase option with respect to any shares of
unvested restricted stock or performance accelerated restricted stock of the Company held by the
Executive as of the Termination Date, and the Company will promptly pay the Executive $.01 for each
share.

          (f) Withholdings. The Company may deduct from the Executive’s Severance Payment and
any other payments otherwise due to the Executive, such withholding taxes and similar governmental
payments and charges as may be required.

          (g) Timing for Payment; Section 409A Restrictions. Notwithstanding anything in this
Agreement to the contrary, it is the intention of the parties that this Agreement comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and any regulations or
other guidance issued thereunder, and this Agreement and the payments of any benefits hereunder
will be operated and administered accordingly. Specifically, but not by limitation, the Executive
agrees that if, at the time of termination of employment, the Company is considered to be publicly
traded and the Executive is considered to be a specified employee, as defined in Section 409A (and
as determined as of December 31 preceding the Executive’s termination of employment, unless the
Executive’s termination of employment occurs prior to April 30, in which case the determination
will be made as of the second preceding December 31), then some or all of such payments to be made
under this Agreement as a result of the Executive’s termination of employment will be deferred for
no more than 6 months following such termination of employment, if and to the extent the delay in
such payments is necessary in order to comply with the requirements of Section 409A of the Code.
Upon expiration of such 6 month period (or, if earlier, the Executive’s death), any payments so
withheld hereunder from the Executive hereunder will be distributed to the Executive, with a
payment of interest thereon

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credited at a rate of prime plus 1% (with such prime rate to be determined as of the actual
payment date).

     2. Release and Waiver.

     The Company’s obligation to make the payments and provide the benefits to the Executive as set
forth in Section 1 above will be conditioned upon and subject to the Executive having delivered to
the Company an executed full and unconditional release (that is not subject to revocation) of any
and all claims against the Company, its parent entities, affiliates, employee benefit plans and
fiduciaries, and their respective officers, employees, directors, agents and representatives
satisfactory in form and content to the Company’s counsel.

     3. Cooperation.

     In connection with a Qualified Termination or any other termination of the Executive’s
employment, the Executive agrees to reasonably cooperate with the Company prior to and in the 60
day period immediately following the Termination Date, subject to the Executive’s other
commitments, in promptly transitioning the Executive’s duties and activities within the Company to
the person or persons designated by the Company to receive them.

     4. Nondisparagement; Non-Solicitation; Confidentiality.

          (a) Nondisparagement. In connection with a Qualified Termination or any other
termination of the Executive’s employment, Executive agrees not to take action or make any
statement, written or oral, in the 1 year period following the Termination Date which is intended
to materially disparage the Company or its business.

          (b) Non-Solicitation. The Executive agrees that, during the 1 year period following a
Qualified Termination or any other termination of the Executive’s employment, the Executive will
not directly or indirectly solicit, attempt to hire, or hire any employee of the Company (or any
person who may have been employed by the Company during the last year of the term of the
Executive’s employment with the Company), or actively assist in such hiring by any other person or
business entity or encourage, induce or attempt to induce any such employee to terminate his or her
employment with the Company.

          (c) Confidentiality. The Executive will not in any manner following a Qualified
Termination or any other termination of the Executive’s employment, directly or indirectly, without
the express prior written consent of the Company, disclose or use any Confidential Information of
the Company. “Confidential Information” will include all information concerning the Company or any
parent, subsidiary, affiliate, employee, customer or supplier or other business associate of the
Company or any affiliate (including but not limited to any trade secrets or other confidential,
proprietary or private matters), which has been or is received by the Executive from the Company,
or from any parent, subsidiary, affiliate or customer or supplier or other business associate of
the Company, and which is not known or generally available to the public.

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     5. Remedies.

     The Executive acknowledges and affirms that money damages cannot adequately compensate the
Company for any breach by the Executive of Section 4 of this Agreement and that the Company is
entitled to equitable relief (without posting any bond) in any federal or state court in
Massachusetts or other court of competent jurisdiction to prevent or otherwise restrain any actual
or threatened breach of the provisions of said Section and/or compel specific performance of, or
other compliance with, the terms thereof.

     6. Miscellaneous.

          (a) At-Will Employment. This Agreement is not a contract to employ the Executive for
a definite time period, and is not intended to be and does not constitute a contract or part of a
contractual agreement for continued employment, either express or implied, between the Company and
the Executive, it being acknowledged that the Executive’s employment is “at will” and that either
the Executive or the Company may terminate the employment relationship at any time, for any or no
reason, with or without Cause and with or without prior notice, but subject to the Executive’s
rights to Severance Benefits under the terms provided hereunder.

          (b) Successors and Assigns. This Agreement and all of the provisions hereof shall be
binding upon, and inure to the benefit of, the parties hereto and their successors (including
successors by merger, consolidation, sale or similar transaction, permitted assigns, executors,
administrators, personal representatives, heirs and distributees). This Agreement is personal in
nature and the rights and obligations of the Executive under this Agreement shall not be assigned
or transferred by the Executive.

          (c) Attorneys Fees. Each party shall bear his or its own attorney’s fees and
expenses.

          (d) Governing Law. This Agreement shall be interpreted in accordance with the
substantive laws of The Commonwealth of Massachusetts and without regard to any conflict of laws
provisions.

          (e) Effect on Other Agreements; Modification. This Agreement constitutes the entire
agreement between the Executive and the Company with respect to the subject matter of this
Agreement. This Agreement may be modified only in a writing signed by both parties. For as long
as this Agreement is in effect, to the degree there is any conflict between the severance payments
and benefit provisions to which the Executive is then entitled under this Agreement and those of
any other written agreement which continues to be in effect between the Company and the Executive,
such conflict shall be resolved by the Company in good faith by affording the Executive the more
favorable severance payments or benefits contained in any such agreement. Notwithstanding the
foregoing, nothing herein relieves the Executive from the obligation to comply with the restrictive
covenants of all such agreements or from the consequences of noncompliance therewith regardless
under which agreement the severance payments and/or severance benefits may be deemed to have been
made. Furthermore, for purposes of clarification only, if an Executive receives severance pay and
benefits under one agreement, the Executive shall not be entitled to severance pay or benefits
under any other agreement, plan or arrangement.

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          (f) Execution. This Agreement may be executed in one or more counterparts, each of
which when so executed shall be deemed to be an original, and all such counterparts together shall
constitute but one and the same instrument.

          (g) Notices. For the purpose of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have been duly given when
delivered or when mailed by United States registered mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth below, or to such other address as either
party may have furnished to the other in writing in accordance herewith, except that notice of
change of address shall be effective only upon actual receipt:

To the Company:

The Talbots, Inc.

One Talbots Drive

Hingham, Massachusetts 02043

Attention: Senior Vice President/Human Resources, Talbots

with a copy to:

The Talbots, Inc.

211 South Ridge Street

Rye Brook, New York 10573

Attn: General Counsel

To the Executive:

Basha Cohen

[Home Address]

     7. Definitions.

     For purposes of this Agreement, the following terms shall have the meanings indicated below:

          (a) “Cause” for termination by the Company of the Executive’s employment shall mean
(i) any material breach by the Executive of this Agreement or any other agreement to which the
Executive and the Company are both parties, (ii) any act or omission to act by the Executive which
may have a material and adverse effect on the Company’s business or on the Executive’s ability to
perform services for the Company, including, without limitation, the commission of any crime
involving moral turpitude or any felony, or (iii) any material misconduct or material neglect of
duties by the Executive in connection with the business or affairs of the Company.

          (b) “Code” shall have the meaning given that term in Section 1(g) hereof.

          (c) “Disability” shall mean the Executive’s inability, because of physical or mental
illness or injury, substantially to perform her duties of her position as a result of physical
incapacity for a continuous period of at least six (6) months. Any dispute at to the Executive’s
incapacitation shall be resolved by an independent physician selected by the Company’s Board

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of Directors and reasonably acceptable to the Executive or her legal representative, whose
determination shall be final and binding upon both the Executive and the Company.

          (d) “Executive” shall mean the individual named in the first paragraph of this
Agreement.

          (e) “Good Reason” for termination by the Executive of the Executive’s employment shall
be a termination based on one or more of the following events occurring without the Executive’s
express written consent: (a) a material breach of the terms of Executive’s offer letter by and
between the Executive and the Company of an even date hereof, (b) a substantial adverse reduction
in the Executive’s duties, other than during any period of illness or incapacity, such that the
Executive no longer has the title of, or serves, as a senior executive of a major branded business
of the Company; (c) a material reduction by the Company in the Executive’s annual base salary as in
effect on the date hereof or as the same may be increased from time to time; or (d) the Company’s
requiring that the Executive’s principal place of business be at an office located more than 35
miles from the site of the Executive’s current principal place of business, except for relocation
to the Company’s principal headquarters location or to the New York metropolitan area or for
required travel on the Company’s business; which, with respect to subsections (a), (b) and (c)
above, is not remedied by the Company within 45 days of receipt of written notice of such event
delivered by the Executive to the Company; provided, that the Executive may only exercise his or
her right to terminate employment for Good Reason within the 90 day period immediately following
the occurrence of any of the events described in subsections (a) through (d) above.

          (f) “Qualified Termination” shall mean the Executive’s employment by the Company is
terminated, (i) by the Executive for Good Reason or (ii) by the Company for any reason other than
for Cause, death, Disability, or retirement at or after age 65.

          (g) “Quiet Period” shall have the meaning given that term in Section 1(e)(ii) hereof.

          (h) “Retirement Plans” shall have the meaning given that term in Section 1(d) hereof.

          (i) “Severance Benefits” shall have the meaning given that term in Section 1(a)
hereof.

          (j) “Severance Payment” shall have the meaning given that term in Section 1(b) hereof.

          (k) “Severance Period” shall have the meaning given that term in Section 1(b) hereof.

          (l) “Termination Date” shall mean the date that the Executive’s employment
with the Company terminates for any reason or no reason.

[signature page follows]

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

	 	 	 	 	 
	 	THE TALBOTS, INC.

 	 
	 	By:  	/s/ John Fiske, III
 	 
	 	 	Duly Authorized 	 
	 	 	 	 
	 	EXECUTIVE

 	 
	 	/s/ Basha Cohen
 	 
	 	Basha Cohen, EVP/CMO, Talbots Brand 	 
	 	 	 
	 

7exv10w70

 

Exhibit 10.70

February 19, 2008

By Overnight Mail

Lori Wagner

[Home Address]

Dear Lori,

On behalf of The Talbots, Inc. (including its subsidiaries, “Talbots” or the “Company”) and subject
to review and approval by the Company’s Board of Directors, we are pleased to offer you the
position of Executive Vice President/Chief Marketing Officer, Talbots Brand in accordance with the
following:

Base Salary, Signing Bonus, Benefits and Perquisites

	•	 	Your initial salary will be at the rate of $600,000 per annum. Your salary will be paid to
you on a bi-weekly basis. Your first review for a possible salary increase based on
demonstrated job performance will be scheduled for the first quarter of FY 2009 and annually
thereafter.
	 
	•	 	You will receive a $125,000 signing bonus, payable as of your employment start date and an
additional $125,000 signing bonus, payable following the expiration of 90 days after your
employment start date. If you voluntarily leave Talbots or resign other than for Good Reason
(as defined below) or your employment is terminated by Talbots for Cause (as defined below) in
your first year of employment, you will be required to reimburse the Company for the total
$250,000 signing bonus (or, if such resignation or termination occurs prior to the payment of
the second increment, the first $125,000 increment of the signing bonus).
	 
	•	 	Commencing on your employment start date, you will be immediately eligible to participate
in all benefit plans currently in effect and generally available at the time to Talbots
executives, subject to plan terms and customary eligibility conditions. Plans are subject to
modification or termination by the Company in its discretion. Included in your benefit
package is an annual vacation benefit of four weeks. Beginning on your employment start date,
you will also be eligible for all perquisites at a level commensurate with the executive vice
president level at Talbots Brand, including an auto allowance, reimbursement of financial
planning expenses and a change in control agreement (attached as Exhibit A).
Perquisites will not be grossed up for taxes.

 

 

Lori Wagner

February 19, 2008

Page 2

	•	 	You will be entitled to reimbursement for business travel (including to the Hingham,
Massachusetts corporate headquarters) and other business expenses in accordance with the
Company’s normal business expense reimbursement policy.
	 
	•	 	With respect to your Brand Marketing responsibilities, you will report directly to the
President and Chief Executive Officer or the Talbots Brand President, if appointed. With
respect to your Direct Marketing responsibilities you will report currently to the Chief
Operating Officer. Your start date will be on or about February 25, 2008 (but no later than
March 11, 2008).

Annual Incentive Award Opportunity

	•	 	You will be eligible for participation in the Company’s incentive plan commencing in FY
2008. Your target award opportunity under the Company’s incentive plan will be 50% of your
base salary. For FY 2008 only, you will receive a minimum bonus equal to one-half of your
target award opportunity for FY 2008. This FY 2008 bonus payment (payable in the second
quarter of FY 2009 at the same time as other FY 2008 bonuses would customarily be paid to
other senior Company officers) is guaranteed and will be paid to you whether or not the
Company’s performance goals under the Company’s 2008 incentive plan are achieved, unless you
voluntarily leave Talbots or resign other than for Good Reason (as defined below) or your
employment is terminated by Talbots for Cause (as defined below) prior to the date that FY
2008 bonuses are paid to senior Company officers.

Equity Compensation

	•	 	You will be eligible to receive such equity incentive compensation as may be awarded from
time to time by the Company’s Compensation Committee of the Board of Directors (the
“Compensation Committee”) pursuant to The Talbots, Inc. 2003 Executive Stock Based Incentive
Plan as same may be amended or superseded from time to time. All incentive awards granted to
you will be subject to the terms of the Plan.
	 
	•	 	Contingent upon approval by the Compensation Committee, as a special hiring inducement
award in consideration for your joining the Company, you will be awarded a one-time restricted
stock award for 35,000 shares of Common Stock of the Company, $0.01 par value per share
(“Common Stock”) pursuant to and subject to the terms and conditions of a Restricted Stock
Award Agreement to be executed by the Company and you. Contingent upon approval by the
Compensation Committee, this restricted stock award will be effective on the later of your
employment commencement date and the effective date of the Compensation Committee’s approval
and will vest in one-quarter annual increments beginning one year from the effective date of
the award.
	 
	•	 	Contingent upon approval by the Compensation Committee, you will also be eligible to
receive a one-time Non-Qualified Stock Option to purchase 15,000 shares of Common Stock upon
your joining the Company. Contingent upon approval by the Compensation Committee, the option
price will be equal to the closing stock price on the grant date which

 

 

Lori Wagner

February 19, 2008

Page 3

	 	 	will be the later of your employment commencement date and the effective date of the
Compensation Committee’s approval. The option will vest in one-third annual increments
beginning one year from the effective date of the award.
	 
	•	 	You understand and agree that the number and timing of any future stock option and
restricted stock awards to you will be subject to Compensation Committee’s sole discretion.

Severance

	•	 	It is understood and agreed that either you or Talbots may terminate the employment
relationship at any time and for any reason upon giving thirty days’ prior written notice.
Your eligibility for severance benefits will be pursuant to and subject to the terms and
conditions of the Severance Agreement being executed between you and the Company at the same
time and attached hereto as Exhibit B (the “Severance Agreement”). Subject to the
terms of such Agreement, in the event of a termination of your employment by the Company
without Cause or by you for Good Reason, you would be entitled to receive 1.0 times your
annual base salary and 12 months benefits continuation, subject to the Company’s receipt of a
release and waiver.

Restrictive Covenants

	•	 	Confidentiality. You agree that you will not, at any time during or following your
employment, directly or indirectly, without the express prior written consent of the Company,
disclose or use any Confidential Information of the Company. “Confidential Information” will
include all information concerning the Company or any parent, subsidiary, affiliate, employee,
customer or supplier or other business associate of the Company or any affiliate (including
but not limited to any trade secrets or other confidential, proprietary or private matters),
which has been or is received by you from the Company, or from any parent, subsidiary,
affiliate or customer or supplier or other business associate of the Company or developed by
you during the term of your employment, and which is not known or generally available to the
public.
	 
	•	 	Non-Disparagement. You agree that, for a period of one year after termination or
cessation of your employment for any reason, you will not take action or make any statement,
written or oral, which is intended to materially disparage the Company or its business.
Notwithstanding anything to the contrary contained herein or in the Severance Agreement,
neither this provision nor the same provision in the Severance Agreement shall apply to
accurate statements by Executive in Executive’s prosecution or defense of any action or
proceeding by or against the Company in any court or other tribunal of competent jurisdiction,
including arbitration and mediation, nor shall it apply to accurate statements by Executive in
any testimony given pursuant to subpoena or other process issued by a court or other tribunal
of competent jurisdiction.
	 
	•	 	Non-Solicitation. You agree that, for a period of one year after the termination
or cessation of your employment for any reason, you will not directly or indirectly solicit,
attempt to hire,

 

 

Lori Wagner

February 19, 2008

Page 4

	 	 	or hire any employee of the Company (or any person who may have been employed by the Company
during the last year of your employment with the Company), or actively assist in such hiring by
any other person or business entity or encourage, induce or attempt to induce any such employee
to terminate his or her employment with the Company.
	 
	•	 	Non-Competition. You agree that throughout your employment, and for a period of 12
months after termination or cessation of employment for any reason, you will not work directly
or indirectly in any capacity or perform any services (including as an officer, director,
employee, agent, advisor, in any consulting capacity or as an independent contractor) for any
person, partnership, division, corporation or other entity in any business in competition with
the principal businesses carried on by the Company in any jurisdiction in which the Company
actively conducts business, including for illustrative purposes only and not limited to, Ann
Taylor, Chico’s FAS, Coldwater Creek, Gap Inc., J. Crew, Liz Claiborne, or Ralph Lauren (or
any of their affiliated brands, subsidiaries or successors).
	 
	•	 	You acknowledge that, with the advice of legal counsel, you understand the foregoing
non-competition and other restrictive covenants, that they are binding and enforceable against
you and that these provisions are fair, reasonable, and necessary for the protection of the
Company’s business.
	 
	•	 	In addition to all other rights and remedies of the Company under this offer letter or
otherwise, upon any material breach of any of the restrictive covenants outlined above, which
is not cured within 10 calendar days following written notice to you from the Company, such
notice to be provided in the same manner as set forth in paragraph 6(g) of the Severance
Agreement, the Company will have the right to terminate any severance payment and benefits
provided pursuant to this offer letter (including all related agreements) or any other or
successor severance agreement covering you and will have the right to recover any severance
payment and benefits previously paid under this agreement or such other related agreements or
any other or successor severance agreement covering you.

Definition

	•	 	“Cause” will have the meaning set forth in the Severance Agreement.
	 
	•	 	“Good Reason” will have the meaning set forth in the Severance Agreement.

Arbitration; Mediation

	•	 	Any dispute, controversy or claim between the parties arising out of or relating to this
offer letter or all related agreements referenced herein, will be settled by arbitration
conducted in The Commonwealth of Massachusetts (before a single arbitrator who shall be a
former federal or state court judge), in accordance with the Commercial Rules of the American
Arbitration Association then in force, provided, however, you acknowledge that in the event of
a violation of the restrictive covenants set forth above, the Company would suffer irreparable
damages and will be entitled to obtain from a state or federal court in The

 

 

Lori Wagner

February 19, 2008

Page 5

	 	 	Commonwealth of Massachusetts or a federal or state court of any other state or jurisdiction,
temporary, preliminary or permanent injunctive relief (without the necessity of posting any bond
or other security), which rights will be in addition to any other rights or remedies to which it
may be entitled. You hereby irrevocably consent to the exclusive jurisdiction of any federal
court or state court located in The Commonwealth of Massachusetts, and you hereby agree that
process in any suit, action or proceeding may be served anywhere in the world in the same manner
as provided for notices to a party as provided in the Severance Agreement. Moreover, nothing in
this provision prevents you from filing, cooperating with, or participating in any proceeding
before the EEOC or a state Fair Employment Practices Agency relating to discrimination or bias
(except that you acknowledge that you may not recover any monetary benefits in connection with
any such proceeding). The decision of the arbitrator conducting any such arbitration
proceedings will be in writing, will set forth the basis therefore and such arbitrator’s
decision or award will be final and binding upon the Company and you. The Company and you will
abide by all awards rendered in such arbitration proceedings, and all such awards may be
enforced and executed upon in any court having jurisdiction over the party against whom or which
enforcement of such award is sought. Notwithstanding the foregoing, the Company and you agree
that, prior to submitting a dispute under this offer letter to arbitration, the parties agree to
submit, for a period of sixty (60) days, to voluntary mediation before a jointly selected
neutral third party mediator under the auspices of JAMS, Boston, Massachusetts, Resolution
Center (or any successor location), pursuant to the procedures of JAMS International Mediation
Rules conducted in The Commonwealth of Massachusetts (however, such mediation or obligation to
mediate will not suspend or otherwise delay any termination or other action of the Company or
affect the Company’s other rights).

Taxes

	•	 	All payments will be subject to rules under Internal Revenue Code Section 409A. If any
payment is withheld from you for Section 409A compliance purposes, such payment will be
distributed to you following the expiration of the applicable period, with a payment of
interest thereon credited at a rate of prime plus 1% (with such prime rate to be determined as
of the actual payment date); provided, however, that any payment of interest will be made only
if and to the extent such payment is consistent with Section 409A and any regulations and
other guidance issued thereunder.

Miscellaneous

	•	 	For the first two years of your employment with the Company, your principal place of
employment and office shall be in New York City, New York, provided that you acknowledge that
regular and ongoing travel to the Company’s corporate headquarters will be required of you, in
addition to other normal business travel. In the event of relocation of the Executive after
such two year period, the Company shall reimburse to the Executive her relocation costs in
accordance with and subject to the terms and conditions of the Company’s Relocation Policy, a
copy of which has been provided to you by the Company. In the event you are reimbursed by the
Company for relocation costs in accordance with the

 

 

Lori Wagner

February 19, 2008

Page 6

	 	 	Relocation Policy, if you voluntarily leave Talbots or resign for other than Good Reason or if
your employment is terminated by Talbots for Cause (as defined below) during the one-year
period following your relocation, you will be required to reimburse the Company for the total
relocation expenses paid to you.
	 
	•	 	You shall have the right to assume outside board and advisory positions that do not present
a conflict of interest with the Company or interfere in any respect with the performance of
your duties, provided that any such board or advisory position (other than customary board or
advisory positions on charitable boards or other similar non-for-profit enterprises) shall be
approved in advance by the Company’s Board of Directors and/or CEO of the Company in its
discretion.
	 
	•	 	This offer letter together with all related agreements referenced herein (collectively, the
“Documents”) constitute the entire understanding between you and the Company and cannot be
modified, altered or waived unless it is done in a writing signed by both you and the Company.
If there is any conflict between the terms of these Documents and any other document related
to your employment, the terms of these Documents will control. This offer letter is governed
by the laws of The Commonwealth of Massachusetts (other than its rules for conflicts of laws).
This agreement is personal in nature to the Company and your rights and obligations under
this agreement may not be assigned by you. This agreement shall be binding upon and inure to
the benefit of the parties hereto and their successors (including successors by merger,
consolidation, sale or similar transaction, permitted assigns, executors, administrators,
personal representatives and heirs).
	 
	•	 	It is the intention of the parties that the provisions of this offer letter will be
enforced to the fullest extent permissible under the laws and public policies of each state
and jurisdiction in which such enforcement is sought, but that the unenforceability (or the
modification to conform with such laws or public policies) of any provisions hereof, will not
render unenforceable or impair the remainder of this offer letter. Accordingly, if any
provision of this offer letter shall be determined to be invalid or unenforceable, either in
whole or in part, this offer letter shall be deemed amended to delete or modify, as necessary,
the offending provisions and to alter the balance of this offer letter in order to render the
same valid and enforceable to the fullest extent permissible.
	 
	•	 	You have provided to the Company a true and complete copy of any non-competition and/or
non-solicitation obligation or agreement to which you may be subject.
	 
	 	 	Notwithstanding the immediately foregoing sentence, by accepting this offer, you hereby confirm
and represent to Talbots, upon the advice of counsel, that you are not a party or subject to any
agreement, obligation or covenant with any former employer or any person, firm or corporation,
which does, or in the future would, prevent, limit or impair in any way the performance by you
of your duties as an employee of Talbots as contemplated by this agreement.

 

 

Lori Wagner

February 19, 2008

Page 7

	•	 	You unconditionally agree not to: (1) use in connection with your employment with Talbots
any confidential or proprietary information which you have acquired in connection with any
former employment; or (2) reveal or disclose to Talbots or any of Talbots employees, agents,
representatives or vendors, any confidential or proprietary information which you have
acquired in connection with any former employment. You acknowledge that this policy and
practice of Talbots is to be strictly followed and adhered to by you. You also agree that you
have not taken and do not have in your possession any confidential information of a prior
employer and have returned to your prior employer any confidential information which was in
your possession.
	 
	•	 	You represent that the information (written or oral) provided to the Company by you or your
representatives in connection with obtaining employment or in connection with your former
employments, work history, circumstances of leaving your former employments and educational
background is true and complete.
	 
	•	 	This offer is effective only through Tuesday, February 19, 2008 and is contingent upon a
satisfactory background check. If you wish to accept our offer as outlined above, please sign
and return this letter to me. The enclosed copy is for your records.

Lori, we are thrilled you are joining the “Talbots Team” and look forward to the contributions you
will make to the overall continued success of the Company!

	 	 	 	 	 
	Very truly yours,

 	 	 
	/s/ John Fiske, III
 	 	 
	John Fiske, III 	 	 
	Senior Vice President

Human Resources 	 	 
	 

Accepted and agreed

this 19th day of February, 2008

	 	 	 	 	 
	         /s/ Lori Wagner
 	 	 
	Lori Wagner

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