EXHIBIT 10.1

 

FIRST AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

FIRST AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Amendment”),
dated July 1, 2008, between PHILLIPS-VAN HEUSEN CORPORATION, a Delaware
corporation (“PVH” and, together with its affiliates and subsidiaries, the
“Company”), and ALLEN SIRKIN (the “Executive”).

 

W I T N E S S E T H:

 

WHEREAS, the Company has previously entered into that certain Amended and
Restated Employment Agreement with the Executive, dated as of June 1, 2007 (the
“Employment Agreement”); and

 

WHEREAS, the parties desire to amend the Employment Agreement to provide for the
extension of the term thereof and establish certain elements of compensation
during the extension.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree as follows:

 

1.             Definitions.  Capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed thereto in the Employment
Agreement.

 

2.             Consideration.  As consideration for the Executive’s agreement to
extend the Employment Period on and subject to the terms and conditions of this
Amendment, it is hereby agreed that the Executive shall be entitled to receive
grants of restricted stock units under the Company’s 2006 Stock Incentive Plan
(as the same may hereafter be amended or under any successor plan), each with a
fair market value on the date of grant (as determined in accordance with such
plan) of $500,000, as follows:

 

(a)   upon the execution of this Amendment by both parties;

 

(b)   on the date of the annual meeting of stockholders of the Company to be
held in calendar year 2009; and

 

(c)   on the date of the annual meeting of stockholders of the Company to be
held in calendar year 2010.

 

Such awards (x) shall be made on substantially the same terms and conditions as
the awards of restricted stock units made to the Executive during the Initial
Period, subject to changes adopted by the Company in connection with any change
in applicable law, rule or regulation, including, without limitation, changes in
tax or accounting treatment, regardless of whether such change is statutory in
nature or effected through other means; provided, however, that (i) the grant
made upon the execution of this Amendment shall vest 50% on the third
anniversary of the date of grant and 50% on the fourth anniversary of the date
of grant; (ii) the grants shall not be subject to

 

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accelerated vesting upon retirement, unless the Executive shall retire on or
after the date of the annual meeting of stockholders of the Company to be held
in calendar year 2011; and (y) are in addition to the annual grants of
restricted stock units to be granted to the Executive pursuant to Section 6 of
this Amendment.  Notwithstanding the foregoing, such grants shall not be made if
the Executive is not employed by the Company in his current position on the date
of grant.

 

3.             Extension of Employment Period.  It is hereby agreed that the
Employment Period shall end on the date of the annual meeting of stockholders of
the Company to be held in calendar year 2011, subject to earlier termination in
accordance with the terms of the Employment Agreement.  In order to effect the
foregoing, Section 1(b) of the Employment Agreement is hereby deleted in its
entirety and the following substituted in lieu thereof:

 

(b)           Employment Period.  The Company agrees to continue to employ the
Executive, and the Executive agrees to continue to be employed by the Company,
in accordance with the terms and conditions hereof, for an initial period
commencing on the Effective Date and ending on the date of the Company’s Annual
Meeting of Stockholders of the Company to be held in calendar year 2009 (the
“Initial Period”) and an extension period commencing on the day immediately
following the end of the Initial Period and ending on the date of the Company’s
Annual Meeting of Stockholders of the Company to be held in calendar year 2011
(the “Renewal Period”), and subject to earlier termination in accordance with
the provision of Section 4 hereof.  The period of time commencing on the
Effective Date and ending on the Executive’s last day of employment, regardless
of the reason for the termination of his employment, is referred to herein as
the “Employment Period.”  Each of the parties acknowledges and agrees that
either party may terminate the Executive’s employment at any time, for any
reason, with or without Cause (as defined in Section 3(a)).

 

4.             Transition Duties.  It is hereby agreed that from and after the
execution and delivery of this Amendment by the parties, the Executive’s duties
shall specifically include active participation in the development of a
succession plan relating to the Executive’s position and duties and in the
training of, and transition of duties to, the person or persons who will succeed
to such duties.  In order to effect the foregoing, Section 1(c)(i) of the
Employment Agreement is hereby deleted in its entirety and the following
substituted in lieu thereof:

 

(c)           Position and Duties.   (i)  During the Employment Period, (A) the
Executive shall serve as the President and Chief Operating Officer of the
Company, with such duties and responsibilities as shall from time to time be
assigned to him and as are consistent and commensurate with his title and
position, and (B) the Executive’s services shall be performed at the Company’s
headquarters in New York, New York as of the Effective Date or such other
location as may be mutually agreed between the Company and the Executive, except
for travel, and visits to Company offices and facilities worldwide, reasonably
required to attend to the Company’s business.  Without limiting the generality
of the foregoing, the Executive shall actively participate in the development of
a succession plan relating to the Executive’s position and duties and in the
training of, and transition of duties to, the person or persons who will succeed
to such duties.

 

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5.             Base Salary Increases.  It is hereby agreed that the Executive’s
Base Salary shall be increased to an annual rate of $950,000 effective June 1,
2009 and to an annual rate of $1,000,000 effective June 1, 2010.  In order to
effect the foregoing, Section 2(a) of the Employment Agreement is hereby deleted
in its entirety and the following substituted in lieu thereof:

 

(a)           Base Salary.  During the Employment Period, the Company shall pay
the Executive a salary at the annual rate of $900,000, increasing to $910,000
effective June 1, 2007, to $950,000 effective June 1, 2009 and to $1,000,000
effective June 1, 2010 (“Base Salary”), payable in accordance with the normal
payroll procedures of the Company in effect from time to time.  The term Base
Salary as utilized in this Agreement shall refer to the Executive’s annual base
salary as then in effect.

 

6.             Equity Awards.  It is hereby agreed that the Executive shall be
entitled to receive awards of restricted stock units under the Company’s 2006
Stock Incentive Plan, each with a fair market value of $1,250,000, at the same
time that annual grants are made to the other executive officers of the Company
in calendar years 2009 and 2010, provided that the Executive is employed in his
current position on each such date.  In order to effect the foregoing, a new
Section 2(e) is hereby added to the Employment Agreement, reading as follows:

 

(e)           Equity Awards.  Notwithstanding anything in this Agreement to the
contrary, during the Renewal Period the Executive shall receive awards under the
Company’s 2006 Stock Incentive Plan (as the same may hereafter be amended or
under any successor plan), as follows:

 

(i) on the date in calendar year 2009 that annual grants of equity awards are
made to the other executive officers of the Company, restricted stock units
having a fair market value on the date of grant (as determined in accordance
with such plan) of no less than $1,250,000; and

 

(ii) on the date in calendar year 2010 that annual grants of equity awards are
made to the other executive officers of the Company, restricted stock units
having a fair market value on the date of grant (as determined in accordance
with such plan) of no less than $1,250,000.

 

For the avoidance of doubt, such awards (x) shall be made on substantially the
same terms and conditions as the awards of restricted stock units made to the
Executive during the Initial Period, subject to changes adopted by the Company
in connection with any change in applicable law, rule or regulation, including,
without limitation, changes in tax or accounting treatment, regardless of
whether such change is statutory in nature or effected through other means;
(y) are in lieu of, and not in addition to, the annual grants of stock options
and restricted stock units that the Executive might otherwise have been granted
consistent with past practice; provided, however, that nothing herein shall
prohibit the Board from making additional or larger awards to the Executive
under the 2006 Stock Incentive Plan (or successor plan); and (z) shall not
affect any performance-based long term incentive award that the Board, in its
sole discretion, may grant to the Executive in the form of performance shares
under the 2006 Stock Incentive Plan

 

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(or successor plan) or a cash award under the Company’s 2005 Long-Term Incentive
Plan.

 

7.             Voluntary Retirement.  Section 3(c) is hereby deleted in its
entirety and the following substituted in lieu thereof to make clear the
treatment of equity awards made during the Initial Period as compared to those
made during the Renewal Period in the event of a voluntary termination, to
delete references to the renewal of the Employment Agreement, to conform the
language to defined terms added by this Amendment and to make certain other
ministerial changes:

 

(c)           Termination by Voluntary Resignation (without Good Reason) by the
Executive; Non-Renewal; Retirement.  The voluntary resignation of employment by
the Executive (other than for Good Reason and which shall not include a
resignation in connection with a termination by the Company for Cause) or the
expiration of this Agreement on the last day of the Renewal Period (if the
Executive remains employed through the end of such period) shall be deemed to be
a retirement and shall be treated as a retirement for purposes of (x) any plan,
policy, program or arrangement of the Company as to which the Executive holds
rights as of such resignation or expiration date, whether as a participant,
beneficiary or otherwise, or (y) any agreement between the Company and the
Executive, except as may otherwise be expressly agreed upon by the Executive. 
In addition, the Executive shall be entitled to (i) the portion of the Base
Salary for periods prior to the effective date of termination accrued but unpaid
(if any), (ii) all unreimbursed expenses (if any), subject to Section 2(d), and
(iii) the payment or provision of any Other Benefits.  Notwithstanding the
foregoing, with respect to any award granted after the Effective Date and prior
to July 1, 2008 under the Company’s 2006 Stock Incentive Plan, Performance
Incentive Bonus Plan or Long-Term Incentive Plan, the termination of the
Executive’s employment by voluntary resignation (other than for Good Reason and
which shall not include a resignation in connection with a termination by the
Company for Cause) shall not be treated as a retirement under the applicable
plan unless such retirement occurs after the last day of the Initial Period.

 

8.             Restrictive Covenant.  The Executive acknowledges and agrees that
he plans to retire upon the end of the Renewal Period and, therefore, agrees
that the restrictive covenants should apply as of the end of the Renewal
Period.  In order to give effect to the foregoing, Sections 5(b) and 5(c) of the
employment Agreement are hereby deleted in their entirety and the following
substituted therefore:

 

(B)           NON-INTERFERENCE.  THE EXECUTIVE ACKNOWLEDGES THAT INFORMATION
REGARDING THE COMPANY’S BUSINESS AND FINANCIAL RELATIONS WITH ITS VENDORS AND
CUSTOMERS IS CONFIDENTIAL INFORMATION AND PROPRIETARY TO THE COMPANY AND THAT
ANY INTERFERENCE WITH SUCH RELATIONS BASED DIRECTLY OR INDIRECTLY ON THE USE OF
SUCH INFORMATION WOULD CAUSE IRREPARABLE DAMAGE TO THE COMPANY.  THE EXECUTIVE
ACKNOWLEDGES THAT BY VIRTUE OF HIS EMPLOYMENT WITH THE COMPANY, HE HAS GAINED OR
MAY GAIN KNOWLEDGE OF SUCH INFORMATION CONCERNING THE COMPANY’S VENDORS AND
CUSTOMERS (RESPECTIVELY “VENDOR INFORMATION” OR “CUSTOMER INFORMATION”), AND
THAT HE WOULD INEVITABLY HAVE TO DRAW ON THIS VENDOR INFORMATION AND CUSTOMER
INFORMATION AND ON OTHER CONFIDENTIAL

 

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INFORMATION IF HE WERE TO SOLICIT OR SERVICE THE COMPANY’S VENDORS OR CUSTOMERS
ON BEHALF OF A COMPETING BUSINESS ENTERPRISE. ACCORDINGLY, AND SUBJECT TO THE
IMMEDIATELY FOLLOWING SENTENCE, THE EXECUTIVE AGREES THAT DURING THE EMPLOYMENT
PERIOD AND FOR A PERIOD OF 18 MONTHS FOLLOWING THE TERMINATION THEREOF, OTHER
THAN BY REASON OF (I) A TERMINATION BY THE COMPANY WITHOUT CAUSE, OR (II) A
TERMINATION BY THE EXECUTIVE FOR GOOD REASON, THE EXECUTIVE SHALL NOT, ON BEHALF
OF HIMSELF OR ANY OTHER PERSON, OTHER THAN THE COMPANY, DIRECTLY OR INDIRECTLY
DO BUSINESS WITH, SOLICIT THE BUSINESS OF, OR PERFORM ANY SERVICES FOR ANY
ACTUAL VENDOR OR CUSTOMER OF THE COMPANY, ANY PERSON THAT HAS BEEN A VENDOR OR
CUSTOMER OF THE COMPANY WITHIN THE 12-MONTH PERIOD PRECEDING SUCH TERMINATION OR
ANY ACTIVELY SOLICITED PROSPECTIVE VENDOR OR CUSTOMER AS TO WHOM OR WHICH THE
EXECUTIVE PROVIDED ANY SERVICES OR AS TO WHOM OR WHICH THE EXECUTIVE HAS
KNOWLEDGE OF VENDOR INFORMATION, CUSTOMER INFORMATION OR CONFIDENTIAL
INFORMATION. THE FOREGOING RESTRICTIVE COVENANT SHALL ONLY APPLY TO BUSINESS
ACTIVITIES ENGAGED IN BY THE EXECUTIVE ON BEHALF OF HIMSELF OR ANY OTHER PERSON
THAT ARE DIRECTLY COMPETITIVE WITH THOSE OF THE OPERATING DIVISIONS OF THE
COMPANY IN WHICH THE EXECUTIVE HAS WORKED OR OVER WHICH HE HAS OR HAS HAD
SUPERVISORY RESPONSIBILITY, IN TERMS OF CHANNELS OF DISTRIBUTION, TYPES OF
PRODUCTS, GENDER FOR WHICH THE PRODUCTS HAVE BEEN DESIGNED AND SIMILARITY OF
PRICE RANGE.  IN ADDITION, THE EXECUTIVE AGREES THAT, DURING THE EMPLOYMENT
PERIOD AND SUCH 18-MONTH PERIOD THEREAFTER, HE WILL NOT, DIRECTLY OR INDIRECTLY,
SEEK TO ENCOURAGE OR INDUCE ANY SUCH VENDOR OR CUSTOMER TO CEASE DOING BUSINESS
WITH, OR LESSEN ITS BUSINESS WITH, THE COMPANY, OR OTHERWISE INTERFERE WITH OR
DAMAGE (OR ATTEMPT TO INTERFERE WITH OR DAMAGE) ANY OF THE COMPANY’S
RELATIONSHIPS WITH ITS VENDORS AND CUSTOMERS, EXCEPT IN THE ORDINARY COURSE OF
THE COMPANY’S BUSINESS.

 

(c)           Non-Competition.  The Executive agrees that, during the Employment
Period and for a period of 12 months following his termination of employment,
other than by reason of (i) a termination by the Company without Cause, or
(ii) a termination by the Executive for Good Reason, the Executive shall not,
without the prior written consent of the Company, directly or indirectly, on the
Executive’s behalf or on behalf of any other person, firm, corporation,
association or other entity, as an employee, director, advisor, partner,
consultant or otherwise, engage in any business of, provide services to, enter
the employ of, or have any interest in, any other person, firm, corporation or
other entity that is engaged in a business that is in competition with the
primary businesses or products of the Company as of the Executive’s date of
termination (following a Change in Control, such businesses or products shall be
limited to those in which the Executive has worked or over which he has or has
had supervisory responsibility, in terms of channels of distribution, types of
products, gender for which the products have been designed and similarity of
price range, as of his date of termination).  Nothing herein shall restrict the
Executive from owning, for personal investment purposes only, less than 5% of
the voting stock of any publicly held corporation or 2% of the ownership
interest in any non-publicly held company, if the Executive has no other
connection or relationship with the issuer of such securities.

 

9.             Continued Effectiveness of the Employment Agreement.  The
Employment Agreement is, and shall continue to be, in full force and effect,
except as otherwise provided in

 

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this Amendment and except that all references to the Employment Agreement set
forth in the Employment Agreement and any other agreements to which the parties
hereto are parties which have been executed prior to the date hereof and
referring to the Employment Agreement shall mean the Employment Agreement, as
amended by this Amendment.

 

10.           Miscellaneous.

 

(a)           This Amendment shall be effective as of the date first set forth
above.

 

(b)           This Amendment may be executed in one or more counterparts, each
of which shall be deemed an original and all of which taken together shall
constitute one and the same amendment.

 

(c)           This Amendment shall be construed without regard to any
presumption or other rule requiring construction against the drafting party.

 

IN WITNESS WHEREOF, the parties have executed this Amendment on the date first
set forth above.

 

 

 

PHILLIPS-VAN HEUSEN CORPORATION

 

 

 

 

 

By:

 

/s/ Mark D. Fischer

 

Name:

 

Mark D. Fischer

 

Title:

 

Senior Vice President

 

 

 

/s/ Allen Sirkin

 

Allen Sirkin

 

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