Document:

Exhibit
10.5

 

BODY CENTRAL CORP.

INDEMNIFICATION AGREEMENT

 

This Agreement is made as of the [    ] day of 2010, by and between Body Central
Corp., a Delaware corporation (the “Corporation”), and [                           ] (the “Indemnitee”),
a director or officer of the Corporation (the “Agreement”).

 

WHEREAS,
it is essential to the Corporation to retain and attract as directors and
officers the most capable persons available, and

 

WHEREAS,
the increase in corporate litigation subjects directors and officers to
expensive litigation risks, and

 

WHEREAS,
it is now and has always been the policy of the Corporation to indemnify its
directors and officers, and

 

WHEREAS,
the Corporation desires the Indemnitee to serve, or continue to serve, as a
director or officer of the Corporation.

 

NOW
THEREFORE, the Corporation and the Indemnitee do hereby agree as follows:

 

1.             Definitions.
As used in this Agreement:

 

(a)           The
term “Proceeding” shall include any threatened, pending or completed
action, suit, arbitration, alternative dispute resolution proceeding,
administrative hearing or other proceeding, whether brought by or in the right
of the Corporation or otherwise and whether of a civil, criminal,
administrative or investigative nature, and any appeal therefrom.

 

(b)           The
term “Corporate Status” shall mean the status of a person who is or was,
or has agreed to become, a director or officer of the Corporation, or is or was
serving, or has agreed to serve, at the request of the Corporation, as a
director, officer, fiduciary, partner, trustee, member, employee or agent of,
or in a similar capacity with, another corporation, partnership, joint venture,
trust, limited liability company or other enterprise.

 

(c)           The
term “Expenses” shall include, without limitation, attorneys’ fees,
retainers, court costs, transcript costs, fees and expenses of experts, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees and other disbursements or expenses of the types
customarily incurred in connection with investigations, judicial or
administrative proceedings or appeals, but shall not include the amount of
judgments, fines or penalties against Indemnitee or amounts paid in settlement
in connection with such matters.

 

(d)           The
term “Change in Control” shall mean the occurrence of any one of the
following:

 

(i)            Any
individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) (a “Person”), other than those Persons in control of the
Corporation as of the date of this Agreement or a trustee or other fiduciary
holding securities under an employee benefit plan of the Corporation or a
corporation owned directly or indirectly by the stockholders of the Corporation
in substantially the same proportions as their ownership of stock of the
Corporation, becomes the beneficial owner (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the Corporation
representing 25% or more of the combined voting power of the Corporation’s then
outstanding securities;

 

(ii)           A
change in the Board of Directors of the Corporation (the “Board”) such
that individuals who as of the date of this Agreement constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date of this Agreement whose election or nomination
for election by the Corporation’s stockholders was

 

 

approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board shall be considered as though such individual were a member of the
Incumbent Board;

 

(iii)          The
consummation of: (a) a plan of complete liquidation of the Corporation; (b) an
agreement for the sale or disposition of all or substantially all of the
Corporation’s assets; or (c) a merger, consolidation or reorganization of
the Corporation with or involving any other corporation, other than a merger,
consolidation or reorganization that would result in the voting securities of
the Corporation outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities
of the surviving entity) at least 50% of the combined voting power of the
voting securities of the Corporation (or such surviving entity) outstanding
immediately after such merger, consolidation or reorganization; or

 

(iv)          The
occurrence of any other event that the Board determines by a duly approved
resolution constitutes a Change in Control.

 

(e)           The
term “Independent Counsel” shall mean a law firm, or a member of a law
firm, that is experienced in matters of corporation law and neither currently
is, nor in the past five years has been, retained to represent: (i) the
Corporation or the Indemnitee in any matter material to either such party or (ii) any
other party to the Proceeding giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall
not include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing
either the Corporation or the Indemnitee in an action to determine the
Indemnitee’s rights under this Agreement.

 

(f)            References
to “other enterprise” shall include employee benefit plans; references
to “fines” shall include any excise tax assessed with respect to any
employee benefit plan; references to “serving at the request of the
Corporation” shall include any service as a director, officer, employee or
agent of the Corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit plan,
its participants, or beneficiaries; and a person who acted in good faith and in
a manner such person reasonably believed to be in the interests of the
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner “not opposed to the best interests of the Corporation”
as referred to in this Agreement.

 

2.             Indemnity of
Indemnitee. Subject to Sections 5, 6 and 8, the Corporation shall
indemnify the Indemnitee in connection with any Proceeding as to which the
Indemnitee is, was or is threatened to be made a party (or is otherwise
involved) by reason of the Indemnitee’s Corporate Status, to the fullest extent
permitted by law (as such may be amended from time to time). In furtherance of
the foregoing and without limiting the generality thereof:

 

(a)           Indemnification in Third-Party Proceedings. The Corporation
shall indemnify the Indemnitee

 

in
accordance with the provisions of this Section 2(a) if the Indemnitee
was or is a party to or threatened to be made a party to or otherwise involved
in any Proceeding (other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor or a Proceeding referred to in Section 5
below) by reason of the Indemnitee’s Corporate Status or by reason of any
action alleged to have been taken or omitted in connection therewith, against
all Expenses, judgments, fines, penalties and amounts paid in settlement
actually and reasonably incurred by or on behalf of the Indemnitee in
connection with such Proceeding, if the Indemnitee acted in good faith and in a    manner which the Indemnitee reasonably
believed to be in, or not opposed to, the best interests of the Corporation
and, with respect to any criminal Proceeding, had no reasonable cause to
believe that his or her conduct was unlawful.

 

(b)           Indemnification in Proceedings by or in the Right of the Corporation.
The Corporation shall indemnify the Indemnitee in accordance with the
provisions of this Section 2(b) if the Indemnitee was or is a party
to or threatened to be made a party to or otherwise involved in any Proceeding
by or in the right of the Corporation to procure a judgment in its favor by
reason of the Indemnitee’s Corporate Status or by reason of any action alleged
to have been taken or omitted in connection therewith, against all Expenses
and, to the extent permitted by law, amounts paid in settlement actually and
reasonably incurred by or on behalf of the Indemnitee in connection with such
Proceeding, if the Indemnitee acted in good faith and in a manner which the
Indemnitee reasonably believed to be in, or not opposed to, the best interests
of the Corporation, except that, if applicable law so requires, no
indemnification shall be made under this Section 2(b) in respect of
any claim, issue or matter as to which the Indemnitee shall have been adjudged
to be liable to the Corporation, unless, and only to the extent, that the Court
of

 

 

Chancery
of Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of such liability but
in view of all the circumstances of the case, the Indemnitee is fairly and
reasonably entitled to indemnity for such Expenses as the Court of Chancery or
such other court shall deem proper.

 

3.             Indemnification
of Expenses of Successful or Partly Successful Party. Notwithstanding
any other provision of this Agreement, to the extent that the Indemnitee has
been successful, on the merits or otherwise, in defense of any Proceeding or in
defense of any claim, issue or matter therein (other than a Proceeding referred
to in Section 5), the Indemnitee shall be indemnified against all Expenses
actually and reasonably incurred by or on behalf of the Indemnitee in
connection therewith. If Indemnitee is not wholly successful in such Proceeding
but is successful, on the merits or otherwise, as to one or more but less than
all claims, issues, or matters in such Proceeding, the Company shall indemnify
Indemnitee against all Expenses actually and reasonably incurred by him or on
his behalf in connection with each successfully resolved claim, issue or
matter.

 

4.             Indemnification
for Expenses of a Witness. To the extent that the Indemnitee is, by
reason of the Indemnitee’s Corporate Status, a witness in any Proceeding to
which the Indemnitee is not a party, the Indemnitee shall be indemnified
against all Expenses actually and reasonably incurred by or on behalf of the
Indemnitee in connection therewith.

 

5.             Exceptions
to Right of Indemnification. Notwithstanding anything to the
contrary to this Agreement, except as set forth in Section 9, the
Corporation shall not indemnify the Indemnitee under this Agreement in
connection with a Proceeding (or part thereof) initiated by the Indemnitee
unless the initiation thereof was approved by the Board of Directors of the
Corporation; and the Corporation shall not indemnify the Indemnitee to the
extent the Indemnitee has been reimbursed from the proceeds of insurance, and
in the event the Corporation makes any indemnification payments to the
Indemnitee and the Indemnitee is subsequently reimbursed from the proceeds of
insurance, the Indemnitee shall promptly refund such indemnification payments
to the Corporation to the extent of such insurance reimbursement.

 

6.             Notification
and Defense of Claim.

 

(a)           As
a condition precedent to the Indemnitee’s right to be indemnified, the
Indemnitee must notify the Corporation in writing as soon as practicable of any
Proceeding for which indemnity will or could be sought. The Indemnitee shall
have the right to employ his or her own counsel in connection with such Proceeding,
and the fees and expenses of counsel for the Indemnitee shall be at the expense
of the Corporation, except as otherwise expressly provided by this Agreement,
and provided that Indemnitee’s counsel shall cooperate reasonably with the
Corporation’s counsel to minimize the cost of defending claims against the
Corporation and the Indemnitee.

 

(b)           The
Corporation shall not be required to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any Proceeding effected without
its written consent. The Corporation shall not settle any Proceeding in any
manner that would impose any penalty or limitation on the Indemnitee without
the Indemnitee’s written consent. Neither the Corporation nor the Indemnitee
will unreasonably withhold or delay their consent to any proposed settlement.

 

7.             Advancement
of Expenses. Subject to the provisions of Section 8, in the
event of any Proceeding of which the Corporation receives notice under
Section 6 of this Agreement, any Expenses actually and reasonably incurred
by or on behalf of the Indemnitee in defending such Proceeding shall be paid by
the Corporation in advance of the final disposition of such Proceeding;
provided, however, that the payment of such Expenses incurred by or on behalf
of the Indemnitee in advance of the final disposition of such Proceeding shall
be made only upon receipt of an undertaking by or on behalf of the Indemnitee
to repay all amounts so advanced to the extent that it shall ultimately be
determined that the Indemnitee is not entitled to be indemnified by the
Corporation as authorized in this Agreement. Such undertaking shall be accepted
without reference to the financial ability of the Indemnitee to make repayment.
Any advances and undertakings to repay pursuant to this Section 7 shall be
unsecured and interest-free.

 

8.             Procedures.

 

(a)           In
order to obtain indemnification or advancement of Expenses pursuant to this
Agreement, the Indemnitee shall submit to the Corporation a written request,
including in such request such documentation and

 

 

information
as is reasonably available to the Indemnitee and is reasonably necessary to
determine whether and to what extent the Indemnitee is entitled to
indemnification or advancement of Expenses. Any such indemnification or
advancement of Expenses shall be made promptly, and in any event within (i) in
the case of advancement of Expenses under Section 7, 20 calendar days
after receipt by the Corporation of the written request of the Indemnitee, or (ii) in
the case of all other indemnification, 30 calendar days after receipt by the
Corporation of the written request of the Indemnitee, subject to the provisions
of Sections 8(b) and (c) below.

 

(b)           With
respect to requests for indemnification under Section 2, indemnification
shall be made insofar as the Corporation determines that Indemnitee has met the
applicable standard of conduct set forth in Section 2. Any determination
as to whether Indemnitee has met the applicable standard of conduct set forth
in Section 2, and any determination that advanced Expenses must be
subsequently repaid to the Corporation, shall be made, in the discretion of the
Board of Directors of the Corporation, (1) by a majority vote of the
directors of the Corporation consisting of persons who are not at that time parties
to the Proceeding (“disinterested directors”), whether or not a quorum, (2) by
a committee of disinterested directors designated by a majority vote of
disinterested directors, whether or not a quorum, (3) if there are no
disinterested directors, or if the disinterested directors so direct, by
Independent Counsel in a written opinion to the Board, or (4) by the
stockholders of the Corporation. Any such determination with respect to
requests under Section 2 shall be made within the 30-day period referred
to in clause (ii) of Section 8(a) (unless extended by mutual
agreement by the Corporation and Indemnitee). For the purpose of the foregoing
determination with respect to requests under Section 2 or repayment of
advanced Expenses, the Indemnitee shall be entitled to a presumption that he or
she has met the applicable standard of conduct set forth in Section 2.

 

(c)           Notwithstanding
anything to the contrary set forth in this Agreement, if a request for
indemnification is made after a Change in Control, at the election of the
Indemnitee made in writing to the Corporation, any determination required to be
made pursuant to Section 8(b) above as to whether the Indemnitee has
met the applicable standard of conduct or is required to repay advanced
Expenses shall be made by Independent Counsel selected as provided in this Section 8(c).
The Independent Counsel shall be selected by the Indemnitee, unless the
Indemnitee shall request that such selection be made by the Board of Directors
of the Corporation. The party making the determination shall give written
notice to the other party advising it of the identity of the Independent
Counsel so selected. The party receiving such notice may, within seven days
after such written notice of selection shall have been given, deliver to the
other party a written objection to such selection. Such objection may be
asserted only on the ground that the Independent Counsel so selected does not
meet the requirements of “Independent Counsel” as defined in Section 1,
and the objection shall set forth with particularity the factual basis of such
assertion. Absent a proper and timely objection, the person so selected shall
act as Independent Counsel. If a written objection is made, the Independent
Counsel so selected may not serve as Independent Counsel unless and until a
court has determined that such objection is without merit. If, within 20 days
after submission by the Indemnitee of a written request for indemnification, no
Independent Counsel shall have been selected or if selected, shall have been
objected to, in accordance with this paragraph either the Corporation or the
Indemnitee may petition the Court of Chancery of the State of Delaware or other
court of competent jurisdiction for resolution of any objection which shall
have been made by the Corporation or the Indemnitee to the other’s selection of
Independent Counsel and/or for the appointment as Independent Counsel of a
person selected by the court or by such other person as the court shall
designate, and the person with respect to whom an objection is favorably
resolved or the person so appointed shall act as Independent Counsel. The
Corporation shall pay the reasonable fees and expenses of Independent Counsel
incurred in connection with its acting in such capacity. The Corporation shall
pay any and all reasonable and necessary fees and expenses incident to the
procedures of this paragraph, regardless of the manner in which such
Independent Counsel was selected or appointed.

 

(d)           The
termination of any Proceeding by judgment, order, settlement, conviction or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create
a presumption that the Indemnitee did not act in good faith and in a manner
that the Indemnitee reasonably believed to be in, or not opposed to, the best
interests of the Corporation, and, with respect to any criminal Proceeding, had
reasonable cause to believe that his or her conduct was unlawful.

 

(e)           The
Company acknowledges that a settlement or other disposition short of final
judgment may be successful if it permits a party to avoid expense, delay,
distraction, disruption and uncertainty. In the event that any action, claim or
proceeding to which Indemnitee is a party is resolved in any manner other than
by adverse judgment

 

 

against
Indemnitee (including, without limitation, settlement of such action, claim or
proceeding with or without payment of money or other consideration) it shall be
presumed that Indemnitee has been successful on the merits or otherwise in such
action, suit or proceeding. Anyone seeking to overcome this presumption shall
have the burden of proof and the burden of persuasion by clear and convincing
evidence.

 

(f)            The
Indemnitee shall cooperate with the person, persons or entity making such
determination with respect to the Indemnitee’s entitlement to indemnification,
including providing to such person, persons or entity upon reasonable advance
request any documentation or information which is not privileged or otherwise
protected from disclosure and which is reasonably available to the Indemnitee
and reasonably necessary to such determination. Any Expenses actually and
reasonably incurred by the Indemnitee in so cooperating shall be borne by the
Corporation (irrespective of the determination as to the Indemnitee’s
entitlement to indemnification) and the Corporation hereby indemnifies the
Indemnitee therefrom.

 

9.             Remedies.
The right to indemnification or advancement of Expenses as provided by this
Agreement shall be enforceable by the Indemnitee in any court of competent
jurisdiction if the Corporation denies such request, in whole or in part, or if
no disposition thereof is made within the applicable period referred to in Section 8.
Unless otherwise required by law, the burden of proving that indemnification is
not appropriate shall be on the Corporation. Neither the failure of the
Corporation to have made a determination prior to the commencement of such
action that indemnification is proper in the circumstances because the
Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Corporation that the Indemnitee has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the Indemnitee has not met the applicable standard of conduct.
The Indemnitee’s Expenses actually and reasonably incurred in connection with
successfully establishing the Indemnitee’s right to indemnification, in whole
or in part, in any such Proceeding shall also be indemnified by the
Corporation.

 

10.           Partial Indemnification.
If the Indemnitee is entitled under any provision of this Agreement to
indemnification by the Corporation for some or a portion of the Expenses,
judgments, fines, penalties or amounts paid in settlement actually and
reasonably incurred by or on behalf of the Indemnitee in connection with any
Proceeding but not, however, for the total amount thereof, the Corporation
shall nevertheless indemnify the Indemnitee for the portion of such Expenses,
judgments, fines, penalties or amounts paid in settlement to which the Indemnitee
is entitled.

 

11.           Subrogation. In
the event of any payment under this Agreement, the Corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of
the Indemnitee, who shall execute all papers required and take all action
necessary to secure such rights, including execution of such documents as are
necessary to enable the Corporation to bring suit to enforce such rights.

 

12.           Term of Agreement.
This Agreement shall continue until and terminate upon the later of (a) six
years after the date that the Indemnitee shall have ceased to serve as a
director or officer of the Corporation or, at the request of the Corporation,
as a director, officer, partner, trustee, member, employee or agent of another
corporation, partnership, joint venture, trust, limited liability company or
other enterprise or (b) the final termination of all Proceedings pending
on the date set forth in clause (a) in respect of which the Indemnitee is
granted rights of indemnification or advancement of Expenses hereunder and of
any proceeding commenced by the Indemnitee pursuant to Section 9 of this
Agreement relating thereto.

 

13.           Indemnification Hereunder
Not Exclusive. The indemnification and advancement of Expenses
provided by this Agreement shall not be deemed exclusive of any other rights to
which the Indemnitee may be entitled under the Third Amended and Restated
Certification of Incorporation, the Amended and Restated By-Laws, any other
agreement, any vote of stockholders or disinterested directors, the General
Corporation Law of Delaware, any other law (common or statutory), or otherwise,
both as to action in the Indemnitee’s official capacity and as to action in
another capacity while holding office for the Corporation. Nothing contained in
this Agreement shall be deemed to prohibit the Corporation from purchasing and
maintaining insurance, at its expense, to protect itself or the Indemnitee
against any expense, liability or loss incurred by it or the Indemnitee in any
such capacity, or arising out of the Indemnitee’s status as such, whether or
not the Indemnitee would be indemnified against such expense, liability or loss
under this Agreement.

 

 

14.           Non-Disclosure of
Payments. Except as expressly required by the securities laws of the
United States of America, neither party shall disclose any payments under this
Agreement unless prior approval of the other party is obtained. If any payment
information must be disclosed, the Company shall afford the Indemnitee an
opportunity to review all such disclosures and, if requested, to explain in
such statement any mitigating circumstances regarding the events to be
reported.

 

15.           No Special Rights.
Nothing herein shall confer upon the Indemnitee any right to continue to serve
as an officer or director of the Corporation for any period of time or at any
particular rate of compensation.

 

16.           Savings Clause.
If this Agreement or any portion thereof shall be invalidated on any ground by
any court of competent jurisdiction, then the Corporation shall nevertheless
indemnify the Indemnitee as to Expenses, judgments, fines, penalties and
amounts paid in settlement with respect to any Proceeding to the full extent
permitted by any applicable portion of this Agreement that shall not have been
invalidated and to the fullest extent permitted by applicable law.

 

17.           Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall constitute the original.

 

18.           Successors and Assigns.
This Agreement shall be binding upon the Corporation and its successors and
assigns and shall inure to the benefit of the estate, heirs, executors,
administrators and personal representatives of the Indemnitee.

 

19.           Headings. The
headings of the paragraphs of this Agreement are inserted for convenience only
and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.

 

20.           Modification and Waiver.
This Agreement may be amended from time to time to reflect changes in Delaware
law or for other reasons. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provision hereof nor shall any such waiver
constitute a continuing waiver.

 

21.           Notices. All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been given (i) when delivered by hand
or (ii) if mailed by certified or registered mail with postage prepaid, on
the third day after the date on which it is so mailed:

 

(a)           if
to the Indemnitee, to the address set forth on the signature page hereto.

 

(b)           if
to the Corporation, to: Body Central Corp.

Attn: General Counsel

6225 Powers Avenue

Jacksonville, FL 32217

 

or
to such other address as may have been furnished to the Indemnitee by the
Corporation or to the Corporation by the Indemnitee, as the case may be.

 

22.           Applicable Law.
This Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the State of Delaware. The Indemnitee may elect to have the
right to indemnification or reimbursement or advancement of Expenses
interpreted on the basis of the applicable law in effect at the time of the
occurrence of the event or events giving rise to the applicable Proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time such indemnification or reimbursement or advancement of Expenses is
sought. Such election shall be made, by a notice in writing to the Corporation,
at the time indemnification or reimbursement or advancement of Expenses is
sought; provided, however, that if no such notice is given, and if the General
Corporation Law of Delaware is amended, or other Delaware law is enacted, to
permit further indemnification of the directors and officers, then the
Indemnitee shall be indemnified to the fullest extent permitted under the
General Corporation Law of Delaware, as so amended, or by such other Delaware
law, as so enacted.

 

 

23.           Enforcement.
The Corporation expressly confirms and agrees that it has entered into this
Agreement in order to induce the Indemnitee to continue to serve as an officer
or director of the Corporation, and acknowledges that the Indemnitee is relying
upon this Agreement in continuing in such capacity.

 

24.           Entire Agreement.
This Agreement sets forth the entire agreement of the parties hereto in respect
of the subject matter contained herein and supersedes all prior agreements,
whether oral or written, by any officer, employee or representative of any
party hereto in respect of the subject matter contained herein; and any prior
agreement of the parties hereto in respect of the subject matter contained
herein is hereby terminated and cancelled. For avoidance of doubt, the parties
confirm that the foregoing does not apply to or limit the Indemnitee’s rights
under Delaware law or the Corporation’s Third Amended and Restated Certificate
of Incorporation or Amended and Restated By-Laws.

 

25.           Consent to Suit.
In the case of any dispute under or in connection with this Agreement, the
Indemnitee may only bring suit against the Corporation in the Court of Chancery
of the State of Delaware. The Indemnitee hereby consents to the exclusive
jurisdiction and venue of the courts of the State of Delaware, and the
Indemnitee hereby waives any claim the Indemnitee may have at any time as to
forum non conveniens with respect to such venue. The Corporation shall have the
right to institute any legal action arising out of or relating to this
Agreement in any court of competent jurisdiction. Any judgment entered against
either of the parties in any proceeding hereunder may be entered and enforced
by any court of competent jurisdiction.

 

[Remainder of the Page Intentionally
Left Blank]

 

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the day and year first above written.

 

	
   

  	
  BODY CENTRAL CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE:

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:Exhibit 10.25

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT made this 27th day of
November, 2007 (this “Agreement”) by and between Richard L. Walters (the “Executive”)
and Body Shop of America, Inc. and Catalogue Ventures, Inc.
(together, the “Company”).

 

W I T N E S S E T H:

 

WHEREAS, Executive and Company desire to enter into this
Agreement setting forth the terms and conditions of the Executive’s employment
with the Company.

 

NOW, THEREFORE, in consideration of the premises and mutual
agreements contained herein and for other good and valuable consideration the
receipt and sufficiency is hereby acknowledged, the parties agree as follows:

 

1.                                       Employment. The Company
hereby employs the Executive as its Executive Vice President and Chief
Financial Officer and the Executive hereby accepts such employment with the
Company upon the terms and subject to the conditions set forth herein.

 

2.                                       Term. Subject to
earlier termination of employment in accordance with the provisions of Section 10
hereof, the term of this Agreement (the “Term”) shall commence as of the
date hereof (the “Effective Date”) and shall extend thereafter until the
tenth anniversary of the Effective Date.

 

3.                                       Position,
Duties and Reporting Relationship. During the Term, the
Executive shall have such duties and responsibilities that are reasonably
commensurate with his title, and such other duties and responsibilities as may
be assigned to him from time to time by the Board of Directors. During the
Term, the Executive shall use the Executive’s skills and render services to the
best of the Executive’s abilities in performing his duties and responsibilities
and shall not engage in any other business activities except with the prior
written approval of the Board, or its duly authorized designee, or as expressly
provided for in Section 14(b) hereof; provided that nothing
herein shall preclude the Executive from (i) serving on the boards of
directors of a reasonable number of other corporations, trade associations or
charitable organizations, subject to the prior written approval of the Board,
which shall not be unreasonably withheld, (ii) engaging in charitable
activities and community affairs or (iii) managing his personal
investments and affairs; provided, that such other activities do not,
individually or in the aggregate, interfere with the performance of the
Executive’s duties to the Company.

 

4.                                       Place of
Performance. The Executive shall perform his duties and
responsibilities and conduct business at the principal executive offices of the
Company in Jacksonville, Florida, except for required travel relating to the
Company’s business.

 

5.                                       Compensation.

 

(a)                                  Base Salary. During the
Term, the Company shall pay the Executive a base salary (“Base Salary”)
at the rate of $304,200 a year. Such Base Salary shall be subject to adjustment
from time to time by the Board in accordance with this Section 5 and shall
be payable

 

 

in accordance with the
Company’s standard payroll policies in effect from time to time, and prorated
for any partial year of employment.

 

(b)                                 Bonus. During the
Term, the Executive shall be entitled to earn an annual bonus (the “Bonus”),
as determined by the Board based on the Executive’s successful performance of
his duties hereunder. The Bonus, if any, shall be payable at the same time bonuses
are payable to the Company’s senior executives generally in accordance with the
Company’s policies with respect thereto in effect from time to time. To be
eligible to receive such Bonus, the Executive must be employed by the Company
on the date that such Bonus is paid by the Company.

 

6.                                       Vacation,
Holidays and Sick Leave. During the Term, the Executive shall be
entitled to four (4) weeks paid vacation and such paid holidays and
personal or sick leave per calendar year in accordance with the Company’s policies
and procedures in effect from time to time for executive personnel. Such
vacation may be taken at the Executive’s discretion at such time or times as
are not inconsistent with the reasonable business needs of the Company and do
not interfere with the performance of the Executive’s duties to the Company.

 

7.                                       Business
Expenses. During the Term, the Company shall reimburse the
Executive for all reasonable travel, entertainment and other business expenses
incurred by the Executive in connection with the performance of his duties and
responsibilities hereunder upon timely submission by the Executive of receipts
and other documentation in accordance with the Company’s standard reimbursement
policies and procedures in effect from time to time.

 

8.                                       Benefits.

 

(a)                                  During the
Term, the Executive shall be entitled to participate in the standard employee
health and retirement benefit plans and programs made available to the Company’s
employees generally, as such plans and programs may be in effect from time to
time (the “Company Plans”). Such participation shall be in accordance
with the terms and conditions of such plans and programs and the Company’s
standard policies and procedures with respect thereto. During the Term, the
Company shall pay the entire premiums for medical insurance under the Company
Plans for the Executive and his immediate family.

 

(b)                                 In addition,
during the Term, the Executive shall be entitled to reimbursement for expenses
not covered by the Company Plans or otherwise for “medical care” (as such term
is defined in Section 213 of the Internal Revenue Code of 1986, as
amended) for him and his immediate family; provided, however, that such
reimbursement shall not exceed in the aggregate $10,000 per year.

 

(c)                                  During the
Term, the Company will pay the premiums on an existing term life insurance
policy on the Executive, payable to a beneficiary designated by the Executive,
not to exceed an annual premium of $930.00.

 

(d)                                 The Company
shall reimburse the Executive for the reasonable and customary expenses up to
$20,000 incurred by the Executive in moving his family to Jacksonville,
Florida. Prior to the date Executive moves his family to Jacksonville, the
Company shall continue to reimburse the Executive for his reasonable expenses
for air travel between Ohio

 

2

 

and Jacksonville, Florida
each week, meals and parking. Reimbursement for such expenses shall cease as of
September 1, 2008 even if the Executive has not moved his family to
Jacksonville, Florida by such date.

 

9.                                       Executive
Perquisites. During the term of this Agreement, the Company
shall pay the Executive an automobile allowance of $1,000 per month.

 

10.                                 Termination of
Employment.

 

(a)                                  General. The Executive’s
employment hereunder may be terminated under the circumstances described in,
and in accordance with, this Section 10.

 

(b)                                 Death or
Permanent Disability.

 

(i)                                     The Executive’s
employment hereunder shall automatically terminate upon the death of the
Executive.

 

(ii)                                  The Board of
Directors may terminate the Executive’s employment hereunder if, as a result of
the Executive’s incapacity due to physical or mental illness or injury, the
Executive has been unable to perform the essential functions of his duties and
responsibilities for a period of either (x) one hundred eighty (180)
consecutive days, or (y) two hundred seventy (270) days (whether or not
consecutive) during any period of eighteen (18) consecutive months (“Disability”),
and no reasonable accommodation can be made (in the Board’s commercially
reasonable determination) that will allow the Executive to perform such
essential functions.

 

(c)                                  Termination by
the Company. The Board of Directors may terminate the Executive’s
employment hereunder at any time, whether for Cause (as defined below) or for
any other reason, or no reason. For purposes of this Agreement, the term “Cause”
shall mean (A) the material failure or refusal by the Executive to perform
the Executive’s duties and responsibilities hereunder (other than any such
failure resulting from the Executive’s Disability) which has not ceased within
ten (10) days after a written demand for performance is received by the
Executive from the Board of Directors, which demand identifies with reasonable
particularity the manner in which the Company believes that the Executive has
not so performed his duties and responsibilities; (B) the engagement by
the Executive in willful misconduct which is materially injurious to the
Company, monetarily or otherwise (including, but not limited to, conduct which
violates Section 14 hereof) or an act of moral turpitude which is
injurious to the Company, monetarily or otherwise; (C) the conviction of
the Executive of, or the entering of a plea of nolo contendere by the Executive
with respect to, a felony or crime involving fraud, dishonesty or moral
turpitude; (D) the material breach by the Executive of this Agreement or
the violation by the Executive of a material policy of the Company which is not
cured within thirty (30) days following receipt of notice thereof from the
Board of Directors (if such breach or violation is capable of being cured); or (E) the
breach by the Executive of any of his fiduciary duties of loyalty and trust to
the Company.

 

(d)                                 Termination by
the Executive. The Executive shall be entitled to voluntarily
terminate his employment hereunder, provided that the Executive shall give six
(6) months prior written notice to the Board of Directors (the “Notice
Period”), specifying the date as of which his termination is to become
effective. During the Notice Period, the Executive shall

 

3

 

cooperate fully with the
Company in recruiting, hiring and training any successor(s) and achieving
a smooth transition of such of the Executive’s duties and responsibilities to
such successors and other person(s) as may be designated by the Board. The
Company reserves the right to accelerate the Date of Termination (as defined in
Subsection (f) below) with respect to a termination by the Executive of
his employment hereunder by giving the Executive prior written notice; such
acceleration, if any, shall not constitute termination without Cause by the
Company.

 

(e)                                  Notice of
Termination. Any purported termination of the Executive’s
employment by the Company or by the Executive shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section 17
hereof. As used herein, the term “Notice of Termination” shall mean a
written notice that shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and
circumstances (if any) claimed to provide a basis for termination of the
Executive’s employment under the provision so indicated.

 

(f)                                    Date of
Termination. As used herein, the term “Date of Termination”
shall mean (i) if the Executive’s employment is terminated because of
death pursuant to Subsection (b) above, the date of the Executive’s death;
(ii) if the Executive’s employment is terminated by the Board of Directors
for Disability pursuant to Subsection (b) above, the date the Notice of
Termination for Disability is delivered to Executive; (iii) if the
Executive’s employment is terminated by the Board of Directors for any reason
other than death, Disability or for Cause pursuant to Subsection (c) above,
the date specified in the Notice of Termination, which date shall not be less
than thirty (30) days from the date such Notice of Termination is given; (iv) if
the Executive’s employment is terminated by the Board of Directors for Cause
pursuant to Subsection (c) above, immediately upon delivery of the Notice
of Termination for Cause and the expiration of any cure period provided under
Subsection (c) above; and (v) if the Executive’s employment is
terminated by the Executive pursuant to Subsection (d) above, the date
specified in the Notice of Termination or such earlier date set forth in a
written notice to the Executive by the Board of Directors in accordance with
Subsection (e) above.

 

11.                                 Compensation
During Disability, Upon Termination or Death.

 

(a)                                  During any
period that the Executive fails to perform the essential functions of his
duties and responsibilities hereunder as a result of an incapacity due to
physical or mental illness, which is expected to be of more than a thirty (30)
day period (“Disability Period”), the Executive shall continue to
receive his Base Salary at the rate then in effect and other benefits to which
he is otherwise entitled hereunder for such period until his employment is
terminated pursuant to Section 10 hereof; provided that payments so made
to the Executive during the Disability Period shall be reduced by the sum of
the amounts, if any, payable to the Executive with respect to such period under
any disability benefit plans of the company, and which amounts were not
previously applied to reduce any such payment.

 

(b)                                 If the
Executive’s employment is terminated by his death or for Disability by the
Board of Directors, the Company shall pay to the Executive or his devisee,
legatee or other designee or, if there is no such designee, to his estate, as
the case may be, (i) any accrued and unpaid Base Salary, to be paid in
accordance with the Company’s standard payroll policies in effect from time to
time, (ii) subject to Section 5(b), any earned but unpaid Bonus from
any

 

4

 

year prior to the year in
which the Date of Termination occurs, and (iii) all other unpaid amounts
and benefits, if any, to which the Executive is entitled as of the Date of
Termination under any compensation plan or program of the Company then in
effect in which the Executive participates (such amount under this clause
(iii), the “Accrued Obligations”), at the time such payments (if any)
are due in accordance with the Company’s standard policies and procedures with
respect thereto; provided that payments so made to the Executive shall
be reduced by the sum of the amounts, if any, payable to the Executive with
respect to any applicable insurance or disability benefit plans of the Company,
and which amounts were not previously applied to reduce any such payment.

 

(c)                                  Subject to the
Executive’s compliance with paragraph 10(d) and to the provisions of
paragraphs (d), (e), (f), (g), (h), (i) and (j) below, if the
Executive’s employment is terminated (i) by the Company without Cause, (ii) by
the Executive for Good Reason (as defined below) or (iii) by the Executive
for any reason after the Executive and his immediate family have moved their
primary residence to Jacksonville, Florida, the Company shall pay to the
Executive (A) an amount equal to his Base Salary then in effect for a
period equal to twelve months from the Date of Termination (the “Severance
Amount”), to be paid according to the Company’s standard payroll policies
in effect from time to time; (B) subject to Section 5(b), any earned
but unpaid Bonus from any year prior to the year in which the Date of
Termination occurs and (C) all other Accrued Obligations, at the time such
payments (if any) are due in accordance with the Company’s standard policies
and procedures with respect thereto.

 

For purposes of this Agreement, the term “Good
Reason” shall mean (x) the reduction of the Executive’s duties or
responsibilities without the Executive’s consent or the assignment of duties to
the Executive which are inconsistent with his position, which reduction or
assignment has not ceased within thirty (30) days after a written demand for
correction is received by the Company from the Executive; provided, that the
Executive shall not be entitled to terminate his employment for Good Reason so
long as he is employed in a headquarters managerial position regardless of
whether other persons are elevated to, or hired for superior positions, (y) the
relocation or attempted relocation of the Executive’s principal place of
employment beyond a fifty (50) mile radius of the Company’s current location
without the Executive’s consent and after the Executive has moved his family to
Jacksonville, or (z) any material breach by the Company of Sections 5 or 8
hereof which has not been cured within thirty (30) days following receipt by
the Company of written notice thereof from the Executive.

 

(d)                                 If the
Executive fails to provide the Company with 6-months notice and/or fails to
perform his duties during this interval of time, the obligations set forth in Section 11(c) shall
cease to exist.

 

(e)                                  If during the “Notice
Period” or for one year after the Date of Termination the Executive fails to
comply with the provisions of Section 14(a) below, then the
obligations set forth in Section 11(c) shall cease to exist.

 

(f)                                    If the
Executive becomes employed in a full-time, part-time or consulting basis by a
Competing Business (defined in Section 14(b) below), then the
obligations set forth in Section 11(c) shall cease to exist.

 

5

 

(g)                                 If during the “Notice
Period” or for one year after the Date of Termination the Executive fails to
comply with the provisions of Section 14(c) below, then the
obligations set forth in Section 11(c) shall cease to exist.

 

(h)                                 If during the “Notice
Period” or for one year after the Date of Termination the Executive fails to
comply with the provisions of Section 14(d) below, then the
obligations set forth in Section 11(c) shall cease to exist.

 

(i)                                     In order to be
entitled to the payment(s) set forth in Subsection (c) above, the
Executive shall, at the direction of the Board, sign a waiver of all
employment-related claims the Executive may have (including any claims under
the Age Discrimination in Employment Act), other than (i) claims for
indemnification and advancement of expense made under Section 22 of this
Agreement or pursuant to the provisions of Buyer’s Certificate of Incorporation
and By-laws for claims arising from service as an officer or director of the
Buyer and its subsidiaries and (ii) claims relating to any breach by the
Company of this Agreement.

 

(j)                                     Except as
otherwise set forth in this Section 11, the Executive shall not be
entitled to any severance or other compensation after termination other than
payment of any portion of his Base Salary and Accrued Benefits through the date
of his termination.

 

12.                                 Representations
and Covenants.

 

(a)                                  The Company
represents and warrants that this Agreement has been authorized by all
necessary corporate action of the Company and is a valid and binding agreement
of the Company enforceable against it in accordance with its terms, except to
the extent that enforceability thereof may be limited by applicable bankruptcy,
reorganization, insolvency or other laws affecting creditors’ rights generally
or by general principles of equity.

 

(b)                                 The Executive
represents and warrants that he is not a party to any agreement or instrument
that would prevent him from entering into or performing his duties in any way
under this Agreement. The Executive agrees and covenants that he will submit to
such physical examinations as may be necessary to facilitate the Company
obtaining an insurance policy (in its discretion) for its benefit insuring the
life of the Executive.

 

13.                                 Successors;
Binding Agreement.

 

(a)                                  This Agreement
is not assignable by the Company except to a successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, provided that
such successor expressly assumes and agrees to perform this Agreement in the
same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place.

 

(b)                                 This Agreement
is a personal contract and the rights and interests of the Executive hereunder
may not be sold, transferred, assigned, pledged, encumbered, or hypothecated by
him, except as otherwise expressly permitted by the provisions of this
Agreement. This Agreement shall inure to the benefit of and be enforceable by
the Executive and his personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.

 

6

 

14.                                 Confidentiality
and Restrictive Covenants.

 

(a)                                  Ownership and
Protection of Proprietary Information.

 

(i)                                     As used herein,
the term “Confidential Information” shall mean data, information or
business practices relating to the business of the Company (which does not rise
to the status of a Trade Secret) which is or has been disclosed to the
Executive or of which the Executive became aware as a consequence of or through
his employment relationship with the Company and which is not generally known
to the public, the industry or its competitors. Notwithstanding the foregoing,
the term Confidential Information shall not include any data or information
that has been voluntarily disclosed to the public by the Company (except where
such public disclosure has been made by the Executive in breach of his
obligations hereunder) or that has been independently developed and disclosed
by others, or that otherwise enters the public domain through lawful means.

 

(ii)                                  As used herein,
the term “Trade Secrets” shall mean data, information or business
practices relating to the business of the Company (including, but not limited
to, technical or non-technical data, formulas, compilations, programs, devices,
methods, techniques, drawings, business processes, financial data, financial
plans, product plans) which (i) derives economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy.

 

(iii)                               Confidentiality. All
Confidential Information and Trade Secrets and all physical embodiments thereof
received or developed by the Executive while employed by the Company are
confidential to and are and will remain the sole and exclusive property of the
Company. Except to the extent necessary to perform his duties and
responsibilities hereunder or to comply with applicable law, the Executive will
hold such Confidential Information and Trade Secrets in strictest confidence,
and will not use, reproduce, distribute, disclose or otherwise disseminate the
Confidential Information and Trade Secrets or any physical embodiments thereof
and may in no event take any action causing any Confidential Information and
Trade Secrets disclosed to or developed by the Executive to lose its character
or cease to qualify as Confidential Information or Trade Secrets.

 

(iv)                              Return of
Company Property. Upon request by the Company during the Term, and
in any event upon termination of the employment of the Executive with the
Company for any reason, the Executive will promptly deliver to the Company all
property belonging to the Company, including, without limitation, all
information or data of the Company, whether or not constituting Confidential
Information and Trade Secrets, (and all embodiments thereof) then in the
Executive’s custody, control or possession.

 

(v)                                 Survival. The covenants
of confidentiality set forth in this Section 14(a) will apply on and
after the Effective Date to any Confidential Information and Trade Secrets of
the Company prior to or after the Effective Date. The covenants restricting the
use of Confidential Information will continue, and the confidentiality of such Confidential
Information shall be maintained by the Executive, for a period of twelve (12)
months following the expiration 

 

7

 

or earlier termination of
the Term. The covenants restricting the use of Trade Secrets will continue, and
the confidentiality of such Trade Secrets will be maintained by the Executive,
following the expiration or earlier termination of the Term for so long as
permitted by Florida law.

 

(b)                                 Agreement Not
to Compete. The Executive agrees that commencing on the
Effective Date and continuing for a period of twelve (12) months following the
expiration or earlier termination of the Term (the “Non-Competition Term”),
the Executive will not (except on behalf of or with the prior written consent
of the Board, which consent may be withheld in the Board’s sole discretion or
as expressly provided for in this Subsection (b)), within the United States,
either directly or indirectly, on the Executive’s own behalf, or in the service
of or on behalf of others, engage, directly or indirectly, as a stockholder,
investor, partner, member, director, officer, employee, consultant or otherwise
in any Competing Business. As used herein, the term “Competing Business shall
mean any business which has a principal line of business engaged in, or which
derives a substantial portion of its revenue from, the retail sale of young
women’s clothing, accessories or footwear, through stores, catalogues or the
internet.

 

(c)                                  Non
Solicitation of Employees. During the Non-Competition Term, the
Executive shall not, directly or indirectly, on the Executive’s own behalf or
in the service of or on behalf of others, solicit or induce any management
level employee of the Company, to terminate his or her employment with the
Company in favor of employment by any other person, firm, corporation or other
entity. This provision will apply whether or not the employee who is solicited
or induced to terminate his or her employment is employed pursuant to a written
agreement and whether or not his or her employment is for a determined period
or at-will. Notwithstanding the foregoing, this provision shall not apply to
prohibit the Executive from hiring members of his family who are not officers
or executives of the Company.

 

(d)                                 Non-Solicitation
of Suppliers and Customers. During the Non-Competition
Term, the Executive shall not, either directly or indirectly, on the Executive’s
own behalf or in the service of or on behalf of others, solicit, divert or
appropriate, or attempt to solicit, divert or appropriate, to a Competing
Business, any individual person, firm, corporation or other entity that was an
actual or prospective supplier or large volume customer of the Company.

 

(e)                                  Enforcement of
Covenants. Without limiting the right of the Company to
pursue all other legal and equitable remedies available for violation by the
Executive of the covenants contained in this Section 14, it is expressly
agreed by the Executive and the Company that other remedies cannot fully
compensate the Company for any violation by the Executive of the covenants
contained in this Section 14 and that the Company shall be entitled to
injunctive relief, without the necessity of proving actual monetary loss, to
prevent any such violation or any continuing violation thereof. The Company and
the Executive further agree that all payments hereunder shall immediately cease
and shall no longer be an obligation of the Company in the event of any
violation of the covenants contained in Subsections (b), (c), or (d) of
this Section 14 which is not cured within (10) days of written notice
by the Company to the Executive of such violation or of a willful and material
violation of the covenants contained in Subsection (a) of this Section 14.
The Company and the Executive further agree that such forfeiture shall not be
deemed to be liquidated damages for breach of such covenants. Each party
intends and agrees 

 

8

 

that if in any action before
any court or agency legally empowered to enforce the covenants contained in
this Section 14 any term, restriction, covenant or promise contained
herein is found to be unreasonable and accordingly unenforceable, then such
term, restriction, covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency.

 

15.                                 Entire
Agreement. This Agreement contains all the understandings
between the parties hereto pertaining to the matters referred to herein, and on
the Effective Date shall supersede all undertakings and agreements, whether
oral or in writing, previously entered into by them with respect thereto,
including, but not limited to the Severance Agreement (the “Severance Agreement”)
dated as of August 15, 2007 between Body Shop of America, Inc. and
the Executive.

 

16.                                 Amendment or
Modification Waiver. No provision of this Agreement may be amended or
waived unless such amendment or waiver is agreed to in writing, signed by the
Executive and by another duly authorized officer of the Company. No waiver by
any party hereto of any breach by another party hereto of any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of a similar or dissimilar condition or provision at the same time,
any prior time or any subsequent time.

 

17.                                 Notices. Any notice to
be given hereunder shall be in writing and shall be deemed given when delivered
personally, sent by courier or telecopy or registered or certified mail,
postage prepaid, return receipt requested, addressed to the party concerned at
the address indicated below or to such other address as such party may
subsequently give notice of hereunder in writing:

 

(a)                                  To Executive
at:

 

Richard L. Walters

740 Line Way

Gahanna, OH 43230

 

(b)                                 To the Company
at:

 

Body Shop of America, Inc.

6225 Powers Avenue

Jacksonville, Florida 32217

Attention:  Chairman

Fax: 904-730-0638

 

Unless actual delivery is expressly required
hereunder, any notice delivered personally or by courier under this Section 17
shall be deemed given on the date delivered and any notice sent by telecopy or
registered or certified mail, postage prepaid, return receipt requested, shall
be deemed given on the date telecopied with receipt confirmed, or if mailed,
the earlier of the date of actual receipt or five (5) days following the
placement of the notice with the U.S. mail with adequate posting for delivery.

 

9

 

18.                                 Severability. If any
provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid and
unenforceable, shall not be affected thereby, and each provision hereof shall
be validated and shall be enforced to the fullest extent permitted by law.

 

19.                                 Survivorship. The
respective rights and obligations of the parties hereunder shall survive any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations, including without limitation, the
Company’s rights and the Executive’s covenants under Section 14 hereof.

 

20.                                 Governing Law. This
Agreement will be governed by and construed in accordance with the laws of the
State of Florida, without regard to its conflicts of laws principles.

 

21.                                 Arbitration. In the event
of any dispute or claim relating to or arising out of this Agreement other than
injunctive and other equitable relief regarding a dispute over the covenants
contained in Section 14 hereof, such dispute shall be fully, finally and
exclusively resolved by a panel of three neutral arbitrators to be mutually
agreed upon by the parties. Such arbitration will be decided under the
employment dispute resolution rules of the American Arbitration
Association and will be held in Jacksonville, Florida. If the parties cannot
agree upon such arbitrators within twenty (20) days after submission of a party’s
request for arbitration in writing, the arbitrators will be selected in
accordance with the procedures of the American Arbitration Association. The
cost of such arbitration shall be borne equally by the Company and the
Executive. The arbitrators shall have no power or authority to award punitive
or special damages. The parties agree that the existence, content and result of
any arbitration proceeding shall be confidential, except to the extent that the
Company determines it is required to disclose such matters in accordance with
applicable laws.

 

22.                                 Indemnification. The Company
hereby agrees to indemnify and hold harmless Executive to the fullest extent
permitted by the provisions of the laws of the jurisdiction of its
incorporation against any liability, loss or expense (including reasonable
attorney’s fees and costs incurred in defense of such claims) incurred in
connection with the Executive’s services as an officer or director of the
Company or any of its subsidiaries or affiliates. The Company shall advance or
cause its subsidiaries to advance all expenses (including all reasonable legal
fees and expenses) incurred by the Executive in defending any such claim,
action or proceeding, whether civil, administrative, criminal or otherwise.

 

23.                                 Termination of
Certain Provisions. Notwithstanding any provision herein to the
contrary, the provisions of Section 8(b) hereof shall terminate
immediately prior to the consummation of (a) the initial public offering
of the Common Stock of the Buyer, (b) any merger or consolidation of the
Company with or into another person or entity or the sale or transfer of all or
substantially all of the assets of the Company, in each case in a single
transaction or in a series of related transactions, or (c) any transaction
in which the stockholders of the Company immediately prior to such transaction,
together with any and all of such stockholders’ affiliates, do not own or hold,
immediately after consummation of such transaction, at least a majority of the
shares of outstanding capital stock of the Company.

 

10

 

24.                                 Tax Withholding. All amounts
payable and benefits provided by the Company hereunder are subject to
withholding to the extent required by law to comply with all federal, state and
local withholding tax requirements.

 

25.                                 Headings. All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed
by reference to the heading of any section or paragraph.

 

26.                                 Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

 

[Signature Page Follows]

 

11

 

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

 

	
   

  	
  BODY SHOP OF AMERICA, INC.

  
	
   

  	
  CATALOGUE VENTURES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Curtis V. Hill

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Richard L. Walters

  
	
   

  	
  Richard L. Walters

  

 

12

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