Document:

PIONEER FINANCIAL SERVICES, INC.
                 - Since 1932 -                       IRA APPLICATION

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1.       PARTICIPANT:

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First Name        Middle Initial            Last Name

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Street Address

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City              State                     Zip Code

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Social Security Number                      Date of Birth

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Daytime Phone                               Evening Phone

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2.   CONTRIBUTION TYPE:
     Please check your contribution type. Enclose a check made payable to
     Pioneer Financial Services (unless you are making a transfer)

[]   Regular IRA Contribution (For current year unless you specify different
     year.) _______
[]   Roth IRA Contribution (For current year unless you specify different
     year.)             ____________
[]   SEP Contributions      []  IRA to IRA Transfer (Complete Section 3 )
[]   Direct Transfer/Rollover From Employer Plan
[]   Rollover Check in the amount of $___________ made payable
                to Pioneer Financial Services is enclosed.

     This represents a Rollover from:

  []   IRA (or SEP IRA)            []   SIMPLE IRA
  []   Qualified Plan or 401(k)    []   Governmental 457(b) Plan
  []   403(b) Plan

     Date qualifying distribution was made __________
                                           ----------

o    Rollovers  of  eligible  distributions  must be made within 60 days of your
     receipt of the distribution.

o    Rollovers  from  another IRA cannot be done if a similar  rollover has been
     made within the 12 months  immediately  preceding the date of issue of this
     Note

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3.   TRANSFER INFORMATION:
     Complete only if you are making an IRA to IRA transfer.
A)   Resigning IRA Custodian Information

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Resigning IRA Custodian

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Street Address or Post Office Box

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City                       State                     Zip Code

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Phone Number                Contact Person (if available)

B)   Transfer Instructions
Please liquidate all assets (or $_________) in my Account Number _____________
[] immediately          []   at maturity
and remit proceeds payable to Pioneer Financial Services to the
 following address:           4700 Belleview, Suite 300
                              Kansas City, MO  64112

X______________________________________________________
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Signature (sign here and in Section 4)      Date

You may qualify for a fully deductible IRA. See reverse side for details.
Pioneer IRA's receive a high rate of return with no costs or fees. All income is
tax-deferred until withdrawal after age 59 1/2 . (Federal IRA rules provide for
substantial penalties for withdrawal before age 59 1/2.)

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                                    INTEREST
                               COMPOUNDED ANNUALLY
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        TERMS             $1,000 - $9,999     $10,000 and over

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     12-35 months            1.75% APY           2.00% APY
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     36-59 months            4.50% APY           5.00% APY
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     60-95 months            6.50% APY           7.00% APY
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    96-119 months            8.50% APY           9.00% APY
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      120 months             9.00% APY           9.50% APY
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                           Quotation Rate Good Through
                                January 31, 2006
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4.   NEW CERTIFICATE AUTHORIZATION

I hereby tender payment for, and authorize and direct Pioneer Financial Services
(PFS), Custodian, to purchase in the amount and for the term indicated below, a
PFS Investment Note as described in the current prospectus of PFS, a copy of
which I received, have read, and understand. I also understand PFS is an IRA
custodian only, and is not rendering investment or tax advice regarding the
advisability of this investment.

Amount $_______________________________________________

Term __________________________________________________ months

Rate                       %        Date
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7
________________________________________________________________________________
Signature

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An IRA Disclosure Statement, Custodial Agreement and Designation of Beneficiary
forms will be mailed to you once your application is received. Please call
816/756-2020 or 1-800-336-5141 for further details and assistance in choosing
your IRA. Pioneer will give current rate quotations by telephone. Your
certificate will be issued at the rate in effect on the date of receipt and that
rate will remain fixed for the term of the certificate. The certificate cannot
be issued and the IRA opened until you have received the IRA Disclosure
Statement and a seven-day revocation period has elapsed.
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<PAGE>

                    2005 REGULAR IRA CONTRIBUTION INFORMATION
                                        .
                Who Is Eligible For A Full Or Partial Deduction?
All persons under age 70 1/2 having earned income are eligible to contribute to
an IRA with all interest or earnings tax-deferred until withdrawn at retirement.
The maximum contribution amount is limited to the lesser of $4,000 per worker or
100% of income. IRA rollovers have been significantly expanded under new laws.
Also, if you will be age 50 or over at the end of 2005, your contribution limit
is increased by $500. However, persons having pension/retirement plan coverage
at work may be limited as to the amount of the contribution which is deductible
from current year income. To determine whether you are eligible to take a full
or partial deduction with respect to a traditional IRA, or contribute with no
deduction but with tax deferred interest, refer to the chart below:

<TABLE>
<CAPTION>
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Modified Adjusted         COVERED by a Retirement Plan             NOT COVERED by a Retirement Plan
Gross Income*             at work, filing status:                  at work, filing status:
-----------------------------------------------------------------------------------------------------------------------------------
<S>              <C>      <C>         <C>              <C>         <C>              <C>               <C>          <C>
At               but      Single or   Married-joint    Married-    Married-joint    Married-separate  Single or    Married-Joint
least            less     Head of     or Qualifying    separate    (Spouse is       (Spouse is        Head of       Or Separate
                 than     Household   Widow(er)                    covered by a     covered by a      Household   (Neither Spouse
                                                                   Retirement Plan  Retirement Plan)                  Covered)
-----------------------------------------------------------------------------------------------------------------------------------
$       0       $ 10,000  FULL        FULL              Partial**  FULL             Partial**
$ 10,000        $ 50,000  FULL        FULL              None       FULL              None
$ 50,000        $ 60,000  Partial**   FULL              None       FULL             None                  Full Deduction Allowed
$ 60,000        $ 70,000  None        FULL              None       FULL             None                 Without Regard to Income
$ 70,000        $ 80,000  None        Partial**         None       FULL             None
$ 80,000        $150,000  None        None              None       FULL             None
$150,000        $160,000  None        None              None       Partial**        None
$160,000
  or Over                 None        None              None       None             None
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

*AGI, Form 1040, plus certain amounts are added back.
** Partial deductions are permitted; see IRS Form 1040 (or Publication 590) for
full details.

Even if you're NOT eligible for a tax deduction, your $4,000 contribution earns
interest that's tax-deferred until withdrawn.

                        No Brokerage Commissions Or Fees

Pioneer can save you a considerable amount of money because you NEVER pay any
commissions or fees of any kind. EVERY penny you contribute to your IRA works
for you by earning interest.

                          IRA Interest Is Tax-Deferred

The interest on your IRA compounds tax-free until withdrawal, at which time your
tax bracket may be much lower.

                              What About My Spouse?

If your spouse is employed, he or she can set up a separate IRA with a $4,000
limit ($4,500 if age 50 or older), or 100% of earned income, whichever is less.

If your spouse has no earned income for the year, you can start an IRA in your
spouse's name with a contribution up to $8,000 for both of you. A new
contribution can be made every year. Your contributions may be split however you
choose as long as not more than $4,000 is contributed into either IRA and the
minimum investment amount of $1,000 is maintained. You must file a joint tax
return to qualify for this plan.

                   When Can I Withdraw The Funds From My IRA?

If your IRA is funded with a Pioneer Certificate, you may only withdraw your
funds at maturity of the Certificates (if before age 59 1/2, this may be subject
to a government tax penalty). You may withdraw your interest from your Pioneer
IRA anytime and over age 59 1/2 there is no tax penalty. In the event of death,
your named IRA beneficiary will receive the total balance of your IRA in
accordance with government regulations in effect on that date. At age 70 1/2
disbursements will start to liquidate your IRA over your remaining life
expectancy regardless of the certificate's maturity date.

                If Interest Rates Drop, Will My Rate Be Reduced?

Not if your IRA is funded with a Pioneer Certificate where the rate is
guaranteed until maturity at which time you have the options to withdraw your
funds or renew at the then current rate. In the event of death, your named IRA
beneficiary can continue to receive the high interest rate to maturity of your
Pioneer Certificate.

<PAGE>

                    TIME IS MONEY! INVEST IN YOUR IRA TODAY!!

*This is general information on the tax aspects of an IRA and is not intended as
specific advice concerning your personal tax situation. Please consult with your
professional tax advisor before contributing money to an IRA plan.EXHIBIT 10.1

                                                               EXECUTION VERSION

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated as of January 1,
2006, by and between STEVEN MADDEN, LTD., a Delaware corporation with offices at
52-16 Barnett Avenue, Long Island City, N.Y. 11104 (the "Corporation"), and
JAMIESON A. KARSON, an individual residing at 229 Woodside Drive, Hewlett Bay
Park, New York, 11557 ("Executive").

                                   WITNESSETH:

         WHEREAS, the Corporation and Executive are parties to that certain
Employment Agreement dated as of May 21, 2001, as amended (the "Prior
Agreement");

         WHEREAS, Executive and the Corporation desire to amend and restate the
Prior Agreement to provide for Executive's employment on the terms and
conditions set forth herein;

         WHEREAS, effective as of the date hereof, Executive and the Corporation
hereby agree that the terms of this Agreement shall supersede, in their
entirety, the terms of the Prior Agreement;

         WHEREAS, Executive and the Corporation further agree that this
Agreement shall govern, in all respects, the terms of the employment of
Executive by the Corporation;

         WHEREAS, Executive is currently the Chairman of the Board of Directors
(the "Board of Directors") and Chief Executive Officer of the Corporation;

         WHEREAS, the Corporation agrees to continue to employ Executive and
Executive agrees to continue in the employ of the Corporation, on the terms and
subject to the conditions set forth is this Agreement.

         NOW, THEREFORE, in consideration of the foregoing premises and the
mutual promises, terms, provisions and conditions set forth in this Agreement,
the parties hereby agree as follows:

    Section 1.    EMPLOYMENT. The Corporation hereby employs Executive and
Executive hereby accepts such employment, as an executive of the Corporation,
subject to the terms and conditions set forth in this Agreement.

    Section 2.    DUTIES. Executive shall serve as Chief Executive Officer
and Chairman of the Corporation's Board of Directors (the "Board of Directors")
and shall properly perform such duties as may be assigned to him from time to
time by the Board of Directors. If requested by the Board of Directors,
Executive shall serve on any committee of the Board of Directors without
additional compensation. During the Term of this Agreement, Executive shall
devote substantially all of his business time and efforts to the performance of
his duties hereunder unless otherwise authorized by the Board of Directors.
Executive shall not engage in any other significant business activity that would
detract from his ability to perform services to the Corporation.

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<PAGE>

    Section 3.    TERM OF EMPLOYMENT. The term of Executive's employment, unless
sooner terminated as provided herein, shall be for a period of three (3) years
commencing January 1, 2006 and ending on December 31, 2008 (as may be extended
from time to time, the "Term"). The Term shall be automatically extended for
successive one-year periods thereafter on the same terms and conditions
specified herein unless the Corporation notifies Executive in writing of its
intention not to so extend the Term at least three (3) months prior to the end
of the original or any extended Term.

    Section 4.    COMPENSATION OF EXECUTIVE.

            4.1   BASE SALARY. Commencing January 1, 2006, the Corporation shall
pay to Executive an annual base salary ("Base Salary")for his services hereunder
of Five Hundred Thousand Dollars ($500,000), less such deductions as shall be
required to be withheld by applicable law and regulations.

            4.2   TIME OF PAYMENT. The Base Salary shall be paid in
substantially equal installments on a basis consistent with the Corporation's
payroll practices for senior executives.

            4.3   ANNUAL BONUS. The Corporation shall pay Executive an annual
bonus, in such amount, if any, and at such time or times, as the Board of
Directors, or a committee thereof, may determine in its absolute discretion,
subject to the Corporation's ordinary payroll practice.

            4.4   STOCK AWARDS. Subject to the availability of shares under any
new stock incentive plan designated by the Board of Directors and approved by
the stockholders (the "New Equity Incentive Plan"), Executive shall be entitled
to participate in the New Equity Incentive Plan, with any award(s) thereunder as
may be determined by the Board of Directors, or a committee thereof, from time
to time in its absolute discretion.

            4.5   EXPENSES. During the Term, the Corporation shall promptly
reimburse Executive for all reasonable and necessary travel expenses and other
disbursements incurred by Executive on behalf of the Corporation in performance
of Executive's duties hereunder, assuming Executive has received prior approval
for such travel expenses and disbursements by the Corporation to the extent
possible, consistent with corporate practice with respect to the reimbursement
of expenses incurred by the Corporation's senior executives.

            4.6   AUTOMOBILE ALLOWANCE. The Corporation shall, at the direction
of Executive, either reimburse Executive for, or directly pay the costs of,
Executive's use of an automobile in connection with the performance of his
duties hereunder during the Term and all usual expenditures in connection
therewith; including, but not limited to, fuel, insurance, parking, customary
maintenance and repairs; provided, however, that expenses either reimbursed or
paid pursuant to this Section 4.6 shall not exceed Ten Thousand Dollars
($10,000) for any year.

            4.7   MEMBERSHIP DUES. The Corporation shall, at the direction of
Executive, either reimburse Executive for, or directly pay the costs of,
Executive's membership dues for any social or professional organizations that
Executive chooses to join; provided, however, that expenses either reimbursed or

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<PAGE>

paid pursuant to this Section 4.7 shall not exceed Twenty-Five Thousand Dollars
($25,000) for any year.

            4.8   BENEFITS. During the Term, Executive shall be entitled to
participate in such pension, profit sharing, group insurance, option plans,
hospitalization, and group health and benefit plans and all other benefits and
plans as the Corporation provides to its senior executives.

            4.9   DEFERRAL OF COMPENSATION. Notwithstanding anything to the
contrary in this Agreement, any remuneration under this Agreement or any other
agreements to which the Corporation and Executive are parties in respect of
employment that is not deductible for any taxable year of the Corporation
because of Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code") will be deferred until the first day that any excess remuneration
becomes deductible under Section 162(m) or by virtue of its repeal or amendment.
Any such deferred payment will bear interest at the prime rate plus one
beginning with the date such payment is first deferred. Notwithstanding any
provision in this Agreement to the contrary, this Section 4.9 shall survive the
termination of this Agreement.

            4.10  BENEFITS UNDER PRIOR AGREEMENT. Nothing herein shall supersede
Executive's entitlement to the bonus provided for under Section 4.3 of the Prior
Agreement and annual stock option grant provided for under Section 4.6 of the
Prior Agreement with respect to fiscal year 2005.

    Section 5.    TERMINATION.

            5.1   DEATH OR TOTAL DISABILITY.

                  (a)      Death. This Agreement shall terminate upon the death
of Executive; provided, however, that the Corporation shall continue to pay to
the estate of Executive the Base Salary as set forth in Section 4.1 hereof for
the twelve (12)-month period immediately subsequent to the date of Executive's
death.

                  (b)      Total Disability. In the event Executive is
discharged due to a "Total Disability" (as defined in Section 6.1 below), then
this Agreement shall be deemed terminated and the Corporation shall be released
from all obligations to Executive with respect to this Agreement, except
obligations accrued prior to such termination and as provided in Section 6.2
hereof.

            5.2   TERMINATION FOR CAUSE; EXECUTIVE'S RESIGNATION. In the event
Executive is discharged "For Cause" (as defined below) or in the event Executive
resigns (other than pursuant to Section 5.5 hereof), then upon such occurrence,
this Agreement shall be deemed terminated and the Corporation shall be released
from all obligations to Executive with respect to this Agreement, except
obligations accrued prior to such termination.

            5.3   TERMINATION OTHER THAN FOR CAUSE. In the event (i) Executive
is discharged other than For Cause and other than due to his death or Total
Disability, or (ii) the Corporation notifies Executive that the Corporation has
elected to not extend the Term of this Agreement as provided in Section 3, or
(iii) of a Change of Control as provided for in Section 5.5, then the
Corporation shall pay Executive (x) the amount of compensation that is accrued

                                       3
<PAGE>

and unpaid through the date of termination pursuant to Section 4 of this
Agreement; plus (y) an amount equal to the lesser of (A) the sum of three (3)
times Executive's highest "Total Compensation" in any given fiscal year of his
employment with the Corporation and (B) Four Million Dollars ($4,000,000). As
used herein, the term "Total Compensation" shall include the following forms of
compensation paid or earned in a particular year under either the Prior
Agreement or this Agreement: (a) Base Salary, (b) any bonus granted to or earned
by Executive (regardless of the year in which it is paid), (c) income recognized
upon the exercise of options to purchase the Corporation's common stock, and (d)
any compensation that is accrued or earned, whether paid or unpaid, in such
year. Such payment shall be subject to a delay of six (6) months and one (1) day
following Executive's termination to the extent necessary to avoid adverse tax
consequences under Section 409A of the Code other than to the extent provided in
Section 5.5 hereof.

            5.4   "FOR CAUSE". As used herein, the term "For Cause" shall mean:

                  (a)      the conviction of, or pleading guilty or nolo
contendere to, any crime, whether or not involving the Corporation, constituting
a felony in the jurisdiction involved, which the Board of Directors, in its sole
discretion, determines may have an injurious effect on the Corporation;

                  (b)      the conviction of any crime involving moral
turpitude; or

                  (c)      gross negligence or willful misconduct in the conduct
of Executive's duties or willful or repeated failure or refusal to perform such
duties as may be delegated to Executive by the Board of Directors which are
consistent with Executive's position, and that as to any conduct concerning this
subsection (c), such conduct is not corrected by Executive within fourteen (14)
days following receipt by Executive of written notice from the Board of
Directors, such notice to state with specificity the nature of the breach,
failure or refusal, gross negligence or willful misconduct related to
Executive's employment with the Corporation.

            5.5   TERMINATION UPON CHANGE OF CONTROL. If, during the period
commencing 120 days prior to a Change of Control and ending on the day
immediately prior to a Change of Control, Executive's employment shall have been
terminated by the Corporation (other than For Cause) or by Executive for Good
Reason or upon a Change of Control (without regard to whether Executive's
employment has been terminated):

                  (a)      all unvested options to acquire stock of the
Corporation or restricted stock awards or other equity-related awards under the
New Equity Incentive Plan held by Executive shall accelerate and fully vest on
the date of a Change of Control; and

                  (b)      the Corporation shall make a lump sum cash payment to
Executive in the amount equal to the amount set forth in Section 5.3 without
duplication within 10 days following the Change of Control; provided, however,
in the event that a Change of Control as defined in Section 5.6(c) does not a
constitute a "change of control" as defined under Section 409A of the Code, the
Corporation shall make a lump sum cash payment to Executive immediately
following the six (6) month anniversary of the date of any termination on or

                                       4
<PAGE>

after the date of the Change of Control (or such earlier period following the
date of termination permitted under Section 409A of the Code without triggering
adverse tax consequences to Executive under Section 409A of the Code) in the
amount equal to the amount set forth in Section 5.3 without duplication.

    Executive and the Corporation shall use their respective best efforts to
work together so that Executive and the Corporation shall not be subject to
adverse tax consequences under Sections 280G and 4999 of the Code, as
applicable. If Executive receives payment under this Section 5.5, Executive
shall not be entitled to payments under Section 5.3 other than any compensation
that is accrued and unpaid through the date of termination pursuant to Section 4
of this Agreement.

            5.6   "CHANGE OF CONTROL." As used herein, the term "Change of
Control" shall mean:

                  (a)      When any "person" as defined in Section 3(a)(9) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and as
used in Section 13(d) and 14(d) thereof including a "group" as defined in
Section 13(d) of the Exchange Act, but excluding the Corporation or any
subsidiary or any affiliate of the Corporation or any employee benefit plan
sponsored or maintained by the Corporation or any subsidiary of the Corporation
(including any trustee of such plan acting as trustee), becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act) of securities of the
Corporation representing a majority of the combined voting power of the
Corporation's then outstanding securities; or

                  (b)      When, during any period of twenty-four (24)
consecutive months, the individuals who, at the beginning of such period,
constitute the Board of Directors (the "Incumbent Directors") cease for any
reason other than death to constitute at least a majority thereof; provided,
however, that a director who was not a director at the beginning of such
24-month period shall be deemed to have satisfied such 24-month requirement (and
be an Incumbent Director) if such director was elected by, or on the
recommendation of or with the approval of, at least two-thirds of the directors
who then qualified as Incumbent Directors either actually (because they were
directors at the beginning of such 24-month period) or through the operation of
this proviso; or

                  (c)      The occurrence of a transaction requiring stockholder
approval for the acquisition of the Corporation by an entity other than the
Corporation or a subsidiary or an affiliated Corporation of the Corporation
through purchase of assets, or by merger, or otherwise.

            5.7   "GOOD REASON" As used herein, the term "Good Reason" shall
mean the occurrence of any of the following:

                  (a)      the assignment to Executive, without his consent, of
any duties inconsistent in any substantial and negative respect with his
positions, duties, responsibilities and status with the Corporation as
contemplated hereunder or diminution of such position, duties and status, if not
remedied by the Corporation within thirty (30) days after receipt of written
notice thereof from Executive;

                                       5
<PAGE>

                  (b)      any removal of Executive, without his consent, from
any positions or offices Executive held as contemplated hereunder (except in
connection with the termination of Executive's employment by the Corporation For
Cause or on account of Total Disability pursuant to the requirements of this
Agreement), if not remedied by the Corporation within thirty (30) days after
receipt of written notice thereof from Executive;

                  (c)      a reduction by the Corporation of Executive's Base
Salary as in effect as contemplated hereunder, except in connection with the
termination of Executive's employment by the Corporation For Cause or due to
Total Disability pursuant to the requirements of this Agreement;

                  (d)      any termination of Executive's employment by the
Corporation during the Term that is not effected pursuant to the requirements of
this Agreement;

                  (e)      any material breach by the Corporation of the terms
of this Agreement that is not remedied by the Corporation within thirty (30)
days after receipt of written notice thereof from Executive;

                  (f)      the relocation of Executive's work location, without
Executive's consent, to a place more than seventy five (75) miles from the
location set forth herein; or

                  (g)      failure by any successor to the Corporation to
expressly assume all obligations of the Corporation under this Agreement, which
failure is not remedied by the Corporation within thirty (30) days after receipt
of written notice thereof from Executive.

            5.8   RELEASE. Payment of severance hereunder pursuant to Section
5.3 or Section 5.5 is conditioned on Executive's executing and not revoking a
general release in such form as shall be reasonably requested by the
Corporation. The Corporation shall also execute a similar release in favor of
Executive.

    Section 6.    DISABILITY.

            6.1   TOTAL DISABILITY. In the event that after Executive has
failed, due to a disability, to have performed his regular and customary duties
for a period of ninety (90) consecutive days or for any one hundred eighty (180)
days out of any three hundred and sixty (360) day period, and before Executive
has become "Rehabilitated" (as herein defined) a majority of the members of the
Board of Directors, exclusive of Executive, may vote to determine that Executive
is mentally or physically incapable or unable to continue to perform such
regular and customary duties of employment and upon the date of such majority
vote, Executive shall be deemed to be suffering from a "Total Disability." As
used herein, the term "Rehabilitated" shall mean such time as Executive is
willing, able and commences to devote his time and energies to the affairs of
the Corporation to the extent and in the manner that he did so prior to his
disability.

            6.2   PAYMENT DURING DISABILITY. In the event Executive is unable to
perform his duties hereunder by reason of a disability, prior to the time such
disability is deemed a Total Disability in accordance with the provisions of
Section 6.1 above, the Corporation shall continue to pay Executive his Base
Salary pursuant to Section 4.1 during the continuance of any such disability.

                                       6
<PAGE>

Upon a determination of any Total Disability pursuant to the provisions of
Section 6.1 above, the Corporation shall pay to Executive his Base Salary
pursuant to Section 4.1 for the twelve (12)-month period immediately subsequent
to the date of determination of Total Disability. Such payment shall be subject
to a delay of six (6) months and one (1) day following Executive's termination
to the extent necessary to avoid adverse tax consequences under Section 409A of
the Code.

    Section 7.    VACATIONS. Executive shall be entitled to a vacation of four
(4) weeks per year, during which period his Base Salary shall be paid in full.
Executive shall take his vacation at such time or times as Executive and the
Corporation shall determine is mutually convenient.

    Section 8.    DISCLOSURE OF CONFIDENTIAL INFORMATION. Executive recognizes
that he has had and will continue to have access to secret and confidential
information regarding the Corporation or any of its affiliates, including, but
not limited to, confidential information and trade secrets concerning the
Corporation's (or any of its affiliate's) working methods, processes, business
and other plans, programs, designs, products, know-how, costs, marketing,
promotion, sales activities, trading, investment, credit and financial data,
manufacturing processes, financing methods, profit formulas, customer names,
customer requirements and supplier names. Executive acknowledges that such
information is of great value to the Corporation, is the sole property of the
Corporation, and has been and will be acquired by him in confidence. In
consideration of the obligations undertaken by the Corporation herein, Executive
will not, at any time, during or after his employment hereunder, reveal, divulge
or make known to any person, any information acquired by Executive during the
course of his employment, which is treated as confidential by the Corporation,
including but not limited to its customer list, and not otherwise in the public
domain. The provisions of this Section 8 shall survive Executive's employment
hereunder.

    Section 9.    COVENANT NOT TO COMPETE.

                  (a)      Executive recognizes that the services to be
performed by him hereunder are special, unique and extraordinary. The parties
confirm that it is reasonably necessary for the protection of the Corporation
that Executive agree, and accordingly, Executive does hereby agree that, except
as provided in subsection (c) below, he shall not, directly or indirectly, at
any time during the Restricted Period within the Restricted Area (as such terms
are defined in Section 9(d) below), engage in any Competitive Business (as
defined in Section 9(d) below), either on his own behalf or as an officer,
director, stockholder, partner, principal, trustee, investor, consultant,
associate, employee, owner, agent, creditor, independent contractor, co-venturer
of any third party or in any other relationship or capacity. The Corporation
acknowledges that Executive is currently a ten percent (10%) stockholder of
Jackarle, Inc., a privately-held, New York retail apparel corporation and the
Corporation agrees that such ownership interest does not violate the
restrictions set forth in this Section 9(a).

                  (b)      Executive hereby agrees that he will not, directly or
indirectly, for or on behalf of himself or any third party, at any time during
the Restricted Period (i) solicit any customers of the Corporation or (ii)
solicit, employ or engage, or cause, encourage or authorize, directly or

                                       7
<PAGE>

indirectly, to be employed or engaged, for or on behalf of himself or any third
party, any employee or agent of the Corporation or any of its subsidiaries.

                  (c)      This Section 9 shall not be construed to prevent
Executive from owning, directly and indirectly, in the aggregate, an amount not
exceeding one percent (1%) of the issued and outstanding voting securities of
any class of any corporation whose voting capital stock is traded on a national
securities exchange or in the over-the-counter market.

                  (d)      The term "Restricted Period," as used in this Section
9, shall mean the period of Executive's actual employment hereunder plus
twenty-four (24) months after the date Executive is no longer employed by the
Corporation. The term "Restricted Area" as used in this Section 9 shall mean
anywhere in the world. The term "Competitive Business" as used in this Agreement
shall mean and include Skechers USA, Inc., Nine West Group Inc., Kenneth Cole
Productions, Inc., Payless ShoesSource, Inc. and Iconix Brand Group, Inc., or
any successor Corporation thereof.

                  (e)      The provisions of this Section 9 shall survive the
termination of Executive's employment as provided hereunder.

    Section 10.   REASONABLENESS OF COVENANTS. Executive acknowledges that he
has carefully read and considered all the terms and conditions of this
Agreement, including the restraints imposed upon him pursuant to Sections 8 and
9 hereof. Executive agrees that said restraints are necessary for the reasonable
and proper protection of the Corporation and its subsidiaries and affiliates,
and that each and every one of the restraints is reasonable in respect to
subject matter, length of time, geographic area and otherwise. Executive further
acknowledges that, in the event any provision of Sections 8 and 9 hereof shall
be determined by any court of competent jurisdiction to be unenforceable by
reason of its being extended over too great a time, too large a geographic area,
too great a range of activities or otherwise, such provision shall be deemed to
be modified to permit its enforcement to the maximum extent permitted by law.
The parties hereto acknowledge that this Agreement and any payments or benefits
required to be made or provided under this Agreement including, without
limitation, any payments or benefits that may be required to be made or provided
under Section 5.5 hereof, are valid consideration for the restraints imposed on
Executive pursuant to Sections 8 and 9 hereof.

    Section 11.   MISCELLANEOUS.

            11.1  ENFORCEMENT OF COVENANTS. The parties hereto agree that
Executive is obligated under this Agreement to render personal services during
the Term of a special, unique, unusual, extraordinary and intellectual
character, thereby giving this Agreement peculiar value, and in the event of a
breach of any covenant of Executive herein, the injury or imminent injury to the
value and goodwill of the Corporation's business could not be reasonably or
adequately compensated in damages in an action at law. Executive therefore
agrees that the Corporation, in addition to any other remedies available to it,
shall be entitled to seek specific performance, preliminary and permanent
injunctive relief or any other equitable remedy against Executive, without the
posting of a bond, in the event of any breach or threatened breach by Executive
of any provision of this Agreement (including, but not limited to the provisions
of Sections 8 and 9). Without limiting the generality of the foregoing, if
Executive breaches any provision of Section 8 or 9 hereof, such breach will

                                       8
<PAGE>

entitle the Corporation to enjoin Executive from disclosing any confidential
information to any competing business, to enjoin such competing business from
receiving Executive or using any such confidential information, and/or to enjoin
Executive from rendering personal services to or in connection with such
competing business. The rights and remedies of the parties hereto are cumulative
and shall not be exclusive, and each party shall be entitled to pursue all legal
and equitable rights and remedies and to secure performance of the obligations
and duties of the other under this Agreement, and the enforcement of one or more
of such rights and remedies by a party shall in no way preclude such party from
pursuing, at the same time or subsequently, any and all other rights and
remedies available to it.

            11.2  SEVERABILITY. The invalidity or partial invalidity of one or
more provisions of this Agreement shall not invalidate any other provision of
this Agreement. If any portion or provision of this Agreement shall to any
extent be declared illegal or unenforceable by a court of competent
jurisdiction, the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

            11.3  ASSIGNMENTS. Neither Executive nor the Corporation may assign
or delegate any of their rights or duties under this Agreement without the
express written consent of the other, except the Corporation may transfer its
rights and duties in connection with a sale of all or substantially all of its
assets or in connection with a business combination (subject to Section 5.5
hereof).

            11.4  ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes and
embodies the full and complete understanding and agreement of the parties with
respect to Executive's employment by the Corporation, supersedes all prior
understandings and agreements, whether oral or written, between Executive and
the Corporation, including the Prior Agreement, and shall not be amended,
modified or changed except by an instrument in writing executed by Executive and
by an expressly authorized officer of the Corporation.

            11.5  WAIVER. No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party. The failure of either
party to require the performance of any term or obligation of this Agreement, or
the waiver by either party of any breach of this Agreement, shall not prevent
any subsequent enforcement of such term or obligation or be deemed a waiver of
any subsequent breach.

            11.6  BINDING EFFECT. This Agreement shall inure to the benefit of,
be binding upon and enforceable against, the parties hereto and their respective
successors, heirs, beneficiaries and permitted assigns.

            11.7  HEADING. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.

                                       9
<PAGE>

            11.8  NOTICES. Any and all notices, requests, demands and other
communications required or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when personally delivered, sent by
registered or certified mail, return receipt requested, postage prepaid, or by
private overnight mail service (e.g. Federal Express) to the party at the
address set forth above or to such other address as either party may hereafter
give notice of in accordance with the provisions hereof. Notices shall be deemed
given on the sooner of the date actually received or the third business day
after sending.

            11.9  GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to such State's conflicts of laws principles and each of the parties
hereto irrevocably consents to the jurisdiction and venue of the federal and
state courts located in the State of New York, County of New York.

            11.10 COUNTERPARTS. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

                                       10
<PAGE>

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

                                       STEVEN MADDEN, LTD.

                                       By: /s/  PETER MIGLIORINI
                                           -------------------------------------
                                           Name:  Peter Migliorini
                                           Title: Chairman, Compensation
                                                  Committee

                                       By: /s/ ARVIND DHARIA
                                           -------------------------------------
                                           Name:  Arvind Dharia
                                           Title: Chief Financial Officer

                                       EXECUTIVE

                                           /s/ JAMIESON A. KARSON
                                           -------------------------------------
                                           Jamieson A. Karson

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