Document:

Illustrative Engagement Letter - Report Reissuance for Former Client (08/00)

Exhibit 10.13

 

October 17, 2001

 

Mr. Richard Stasyszen

Senior Vice President, Finance, Controller and Treasurer

Stage Stores, Inc.

10201 Main Street

Houston, Texas 77025

 

Dear Mr. Stasyszen:

You have requested PricewaterhouseCoopers LLP to reissue our audit report on the consolidated financial statements of Stage Stores, Inc. (the "Company") as of January 29, 2000 and for each of the two years in the period ended January 29, 2000, for filing on Form 10 with the Securities and Exchange Commission. The purpose of this letter is to confirm our understanding of the terms under which we will agree to reissue our report as your former independent accountants.

Services and related report

Before we agree to reissue our audit report for the purposes of its inclusion in the filing of Form 10 with the Securities and Exchange Commission, we will obtain updating written representations covering the financial statements previously audited by us from certain members of management, a representation letter from the successor accountants, and perform the other subsequent events procedures required by paragraphs AU 508.71-.72 and AU 711.11 of the AICPA Professional Standards. If, for any reasons caused by you or relating to your affairs, we are unable to complete our procedures, we may decline to reissue our report as a result of this engagement.

Management's responsibilities

The financial statements referred to above are the responsibility of the management of the Company. Management also is responsible for making available to us, upon request, all of the Company's original accounting records and related information, and company personnel to whom we may direct inquiries.

Generally accepted auditing standards require that we read pertinent portions of the registration statement. In this connection, management agrees to (a) provide us with a draft document to read and, (b) obtain our approval for inclusion of our report in such document before it is finalized and distributed. To facilitate these matters, please advise us of any required due dates as soon as practicable, but no later than 10 business days 

prior to such due dates. It is understood that we will need a reasonable amount of time (a minimum of five business days) to review the applicable documents.

Indemnification

The Company agrees to indemnify PricewaterhouseCoopers LLP for the payment of all legal costs and expenses incurred in PricewaterhouseCoopers LLP's successful defense of any legal action or proceeding that arises as a result of inclusion of PricewaterhouseCoopers LLP's previous audit report on the Company's past financial statements in the filing of Form 10 with the Securities and Exchange Commission.

However, this indemnification provision will be void, and any advanced funds will be returned to you, if a court, after adjudication, finds PricewaterhouseCoopers LLP liable for professional malpractice.

Notwithstanding anything to the contrary in this engagement letter, PricewaterhouseCoopers LLP acknowledges that such indemnification does not apply to any claims that arise as a result of the inclusion of such reports in any filings with the Securities and Exchange Commission prior to the date of the filing of the Form 10.

You should contact the SEC's Division of Corporation Finance regarding required disclosures of the general effect of this indemnification agreement.

Timing and fees

We have been requested to complete our consideration to reissue our report by early in the week of October 22, 2001. Completion of our consideration to reissue by this date is subject to, among other things, appropriate cooperation from the successor auditor and the Company's personnel including timely responses to our inquiries. 

Our fees for this engagement will be based on the time required by the individuals assigned to the engagement at 100% of our Firm's standard hourly rates, plus out-of-pocket expenses. 

Invoices rendered are due and payable upon receipt and prior to the reissuance of our reports as discussed above.

Other matters

Any additional services that you may request and we agree to provide will be the subject of separate written agreements.

In the event we are requested or authorized by you or required by government regulation, subpoena, or other legal process to produce our working papers or our personnel as witnesses with respect to our engagement for you, you will, so long as we are not a party to the proceeding in which the information is sought, reimburse us for our professional time and expenses, as well as the fees and expenses of our counsel, incurred in responding to such a request.

The Company agrees that it will not, directly or indirectly, agree to assign or transfer any claim against PricewaterhouseCoopers LLP arising out of this engagement to anyone.

This engagement letter reflects the entire agreement between us relating to the services covered by this letter. It replaces and supersedes any previous proposals, correspondence and understandings, whether written or oral. The agreements of the Company and PricewaterhouseCoopers LLP contained in this engagement letter shall survive the completion or termination of this engagement. 

If you have any questions, please call Richard Spears at (713) 356-4585. If the services outlined herein are in accordance with your requirements and if the above terms are acceptable to you, please have one copy of this letter signed in the space provided below and return it to us.

Very truly yours,

 

 

PricewaterhouseCoopers LLP

 

The services and terms as set forth in this letter are agreed to.

 

Stage Stores, Inc.

 

	
 

By:
	
 /s/Richard E. Stasyzen

	
 

 

 
	
Richard E. Stasyszen

 

	
 
	
Senior Vice President Finance and Controller

	
 
	
 

 

	
 
	
(Date)EXHIBIT 10.15

                    FIRST AMENDMENT OF LEASE

AGREEMENT made this 9th day of August 2001 by and between:

THE BRONSON ROAD GROUP, LLC, a limited liability company
organized and existing pursuant to the laws of the State of
Connecticut with an office and place of business at 9 Bayberry
Ridge Road, Westport, Connecticut 06880 ("Landlord"); and

COMPETITIVE TECHNOLOGIES, INC., a corporation organized and
existing pursuant to the laws of the State of Delaware, with an
office and place of business at 1960 Bronson Road, Fairfield,
Connecticut 06430 ("Tenant").

Whereas, the Landlord and Tenant entered into a certain lease
agreement under date of August 28, 1996, (the "Lease") whereby
Landlord leased to Tenant that certain demised premises known as
1960 Bronson Road, interior of Building 1, first and second
floors, all as more particularly described in the Lease, for the
rent and term set forth in the Lease, and subject to the other
conditions and terms more particularly described in the Lease;
and

Whereas, the Lease provided for a term of five years from
January 1, 1997 through December 31, 2001, and one option to
extend the lease for one additional five (5) year term from
January 1, 2002 through December 31, 2006 all on terms as more
fully set forth in the Lease; and

Whereas, the Landlord and Tenant desire to modify the terms of
the "Extension Term" and make such other and further
modifications as are herein contained:

NOW THEREFORE in consideration of the premises and covenants
herein contained and in further consideration of ONE DOLLAR and
other valuable consideration paid, each to the other, Landlord
and Tenant covenant and agree as follows.

1.   Section 18.  Section 18 of the Lease is hereby deleted and
     replaced with the following:

     Section 18.  Renewal Terms.

          (a)  Lessee's Option For First Renewal Term.  LESSEE
     shall have an option to continue this Lease for an
     additional term of five years from January 1, 2002 trough
     December 31, 2011 subject to the following terms and
     conditions:

               i.   from January 1, 2002 through June 30, 2004,
                    base rent shall be $25.00 per square foot of
                    such Leased Space, a total of $562,500.00
                    payable in equal monthly installments of
                    $18,750.00 in advance on the first day of
                    each month.

               ii.  from July 1, 2004 through December 31, 2006
                    base rent shall be the greater of (1) the
                    fair market value rent (on a "gross lease"
                    basis) as of January 1, 2004 determined in
                    accordance with subsection (c) below, and
                    (2) $25.00 per square foot of such Leased
                    Space per year, i.e., such base rent shall
                    not be less than $25 per square foot of such
                    Leased Space per year and such rent shall
                    total at least $562,500.00, payable in equal
                    monthly installments of at least $18,750.00.

               iii. The LESSEE shall not be in default of any
                    term or condition of this lease at the time
                    of its exercise of this option.

               iv.  This option shall be exercised by LESSEE
                    only through a writing to LESSOR in
                    accordance with Section 24(b) below received
                    by LESSOR on or before June 30, 2001 at 5:00
                    p.m. Eastern Daylight Savings Time.

               v.   Time is of the essence in LESSEE's exercise
                    of this option

          (b)  Lessee's Option For Second Renewal Term.  LESSEE
     shall have an option to continue this lease for an
     additional term of five years from January 1, 2007 through
     December 31, 2001 subject to the following conditions:

               i.   Base rent during the Second Renewal Term shall
                    be the greater of (1) the fair market value
                    rent (on a "gross lease" basis) as of July 1,
                    2006 determined in accordance with subsection
                    (c) below, and (2) $25.00 per square foot of such
                    Leased Space per year, i.e., such base rent shall
                    be not less than $25.00 per square foot of such
                    Leased Space per year and such rent shall total
                    at least $1,125,000.00, payable in equal monthly
                    installments of at least $18,750.00; and (3)
                    the base rent for the month immediately preceding
                    the Second Renewal Term multiplied by 60 and
                    paid in equal monthly installments.

               ii.  The LESSEE shall not be in default of any term
                    or condition of this lease at the time of its
                    exercise of this option.

               iii. This option shall be exercised by LESSEE only
                    through a writing to LESSOR in accordance with
                    Section 24(b) below received by LESSOR on or
                    before June 30, 2006 at 5:00 p.m. Eastern
                    Daylight Savings Time.

               iv.  The LESSEE may not exercise this option for a
                    Second Renewal Term prior to January 1, 2006.

               v.   Time is of the essence in LESSEE's exercise
                    of this option.

          (c)  The determination of the fair market value rent
     of the Leased Space shall be determined as herein provided.
     Six Months prior to the date fixed rent, in which the
     determination of the fair market value rent of the Leased
     Space is a component of ascertaining fixed rent, is to be
     due, LESSOR and LESSEE shall each appoint an appraiser.  If
     the appraisers agree what the fair market value rent of the
     Leased Space is, then that value shall be the fair market
     value rent for these purposes.  In the event the appraisers
     so appointed cannot agree, then the appraisers shall agree
     upon and appoint a third appraiser.  The fair market value
     rent of the Leased Space shall be the average of the three
     appraisals.

2.   In all other respects, the Lease remains in full force and
     effect unmodified except as hereinabove provided.  It is
     the intention of the parties that this instrument
     constitutes an amendment of the existing Lease and is not
     intended to constitute a novation or new lease.

IN WITNESS WHEREOF, the parties aforesaid have caused these
presents to be executed by the duly authorized officer of each
party and the seal of the business entity to be affixed
hereupon.

WITNESSED BY

s/ Robert Cohen                    THE BRONSON ROAD GROUP, LLC

s/ Eileen Blau                     By s/ Barry Blau
                                        Barry Blau
                                        Its Member

s/ Donna Mays 8/9/2001             COMPETITIVE TECHNOLOGIES, INC.

S/ Noreen Rando 8/9/2001           By s/ Frank R. McPike, Jr.
                                        Its President & CEO

STATE OF CONNECTICUT     }
                         } SS. Westport
COUNTY OF FAIRFIELD      }

The foregoing instrument was acknowledged before me this 27th
day of August 2001 by Barry Blau, Member of THE BRONSON ROAD
GROUP, LLC, a Connecticut limited liability company on behalf of
the said limited liability company.

                         s/ Mary Larubbio
                          NOTARY PUBLIC
                    MY COMMISSION EXPIRES: Feb. 28, 2003

STATE OF CONNECTICUT     }
                         } SS. Fairfield
COUNTY OF FAIRFIELD      }

The foregoing instrument was acknowledged before me this 30th
day of August 2001 by Frank R. McPike, Jr., President and CEO of
COMPETITIVE TECHNOLOGIES, INC. a Delaware corporation on behalf
of the said corporation.

                         s/ Donna J. Mays
                          NOTARY PUBLIC
                    MY COMMISSION EXPIRES: July 31, 2003

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