EXECUTION COPY

Exhibit 10.14

POLO RALPH LAUREN CORPORATION

NONQUALIFIED STOCK OPTION AGREEMENT

     THIS AGREEMENT (the “Agreement”), is made effective as of the 8th day of
June, 2004, (the “Date of Grant”), between Polo Ralph Lauren Corporation, a
Delaware corporation (the “Company”), and Mr. Ralph Lauren (the “Participant”):

R E C I T A L S:

          WHEREAS, the Company has adopted the Polo Ralph Lauren Corporation
1997 Long-Term Stock Incentive Plan, as amended from time to time (the “Plan”),
which Plan is incorporated herein by reference and made a part of this
Agreement. Capitalized terms not otherwise defined herein shall have the same
meanings as in the Plan; and

          WHEREAS, the Company and the Participant have entered into an Amended
and Restated Employment Agreement dated June 23, 2003 (such agreement, as
amended from time to time, the “Employment Agreement”), which contemplates that
the Committee will grant the Option (as hereinafter defined) to the Participant;
and

          WHEREAS, the Committee has determined that it would be in the best
interests of the Company and its stockholders to grant the option provided for
herein (the “Option”) to the Participant pursuant to the Plan and the terms set
forth herein.

          NOW THEREFORE, in consideration of the mutual covenants hereinafter
set forth, the parties hereto agree as follows:

     1. Grant of the Option. The Company hereby grants to the Participant the
right and option to purchase, on the terms and conditions hereinafter set forth,
all or any part of an aggregate of 150,000 shares of Class A Common Stock of the
Company (the “Shares”)(the “Option”), subject to adjustment as set forth in the
Plan. The purchase price of the Shares subject to the Option shall be $33.12 per
Share (the “Exercise Price”), which amount is equal to the Fair Market Value on
the Date of Grant. The Option is intended to be a non-qualified stock option,
and is not intended to be treated as an option that complies with Section 422 of
the Internal Revenue Code of 1986, as amended (the “Code”).

     2. Vesting and Exercisability.

          (a) Subject to the Participant’s continued employment with the
Company, the Option shall vest and become exercisable with respect to one third
(1/3) of the Shares initially covered by the Option on each of the first, second
and third anniversaries of the Date of Grant

 

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(each, an “Option Vesting Date”). At any given time, the portion of the Option
that has become vested and exercisable as described above (or pursuant to
Sections 2(c) below) is hereinafter referred to as the “Vested Portion.”

          (b) If the Company shall terminate the Participant’s employment with
the Company without Cause (as defined below), if the Company elects not to
extend the Term (as defined below) or if the Participant terminates his
employment with the Company for Good Reason (as defined below), then any
unvested portion of the Option on the last day of the Participant’s employment
with the Company (the “Termination Date”) shall continue to vest in accordance
with the vesting schedule set forth in Section 2(a) hereof, subject to
Participant’s continued compliance with Section 8 of the Employment Agreement
(relating to non-solicitation and non-competition). In addition, any Vested
Portion (and any other portion that vests as described above in this
Section 2(b)) will remain exercisable until the later to occur of (i) one
(1) year from the Termination Date or (ii) thirty (30) days from the date such
portion of the Option becomes vested and exercisable, but in no event later than
the Expiration Date (as defined below) of the Option.

          (c) If the Participant’s employment is terminated due to his death or
Disability (as defined below), then any unvested portion of the Option held by
the Participant on the Termination Date will vest immediately and remain
exercisable for three (3) years from the Termination Date, but in no event later
than the Expiration Date (as defined below) of the Option.

          (d) If the Participant’s employment with the Company is terminated by
the Company for Cause, by the Participant other than for Good Reason, or if the
Participant elects not to extend the Term, then any portion of the Option that
has not been exercised as of the Termination Date shall be forfeited.

          (e) Notwithstanding any other provision of this Agreement to the
contrary, in the event of a Change of Control (as defined in the Plan) the
Option shall, to the extent not then vested and not previously canceled,
immediately become fully vested and exercisable as contemplated by Section 13 of
the Plan.

          (f) For purposes of this Agreement, the terms “Cause,” “Term,” “Good
Reason,” and “Disability” shall have the respective meanings specified in the
Employment Agreement.

     3. Exercise of Option.

          (a) Period of Exercise. Subject to the provisions of the Plan and this
Agreement, the Participant may exercise all or any part of the Vested Portion of
the Option at any time prior to the tenth anniversary of the Date of Grant (the
“Expiration Date”).

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          (b) Method of Exercise.

               (i) Subject to Section 3(a), the Vested Portion of the Option may
be exercised by delivering to the Company at its principal office written notice
of intent to so exercise or by delivering such notice to the Company by such
other method as may be permitted by the Committee; provided that the Option may
be exercised with respect to whole Shares only. Such notice shall specify the
number of Shares for which the Option is being exercised and shall be
accompanied by payment in full of the Exercise Price. The payment of the
Exercise Price may be made in cash, or its equivalent, or (x) by exchanging
Shares owned by the Participant (which are not the subject of any pledge or
other security interest and which have been owned by the Participant for at
least 6 months) or (y) subject to such rules as may be established by the
Committee and then only to the extent permitted by law, through delivery of
irrevocable instructions to a broker to sell the Shares otherwise deliverable
upon the exercise of the Option and to deliver promptly to the Company an amount
equal to the aggregate exercise price, or by a combination of the foregoing,
provided that the combined value of all cash and cash equivalents and the Fair
Market Value of any such Shares so tendered to the Company as of the date of
such tender is at least equal to such aggregate exercise price.

               (ii) Notwithstanding any other provision of the Plan or this
Agreement to the contrary, the Option may not be exercised prior to the
completion of any registration or qualification of the Option or the Shares
under applicable state and federal securities or other laws, or under any ruling
or regulation of any governmental body or national securities exchange that the
Committee shall in its sole discretion determine to be necessary or advisable.

               (iii) Upon the Company’s determination that the Option has been
validly exercised as to any of the Shares, the Company shall issue certificates
in the Participant’s name for such Shares. However, the Company shall not be
liable to the Participant for damages relating to any delays in issuing the
certificates to him, any loss of the certificates, or any mistakes or errors in
the issuance of the certificates or in the certificates themselves.

     4. No Right to Continued Employment. Neither the Plan nor this Agreement
shall be construed as giving the Participant the right to be retained in the
employ of, or in any consulting relationship to, the Company or any Affiliate.
Further, the Company or an Affiliate may at any time dismiss the Participant or
discontinue any consulting relationship, free from any liability or any claim
under the Plan or this Agreement, except as otherwise expressly provided herein.

     5. Legend on Certificates. The certificates representing the Shares
purchased by exercise of the Option shall be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under the Plan
or the rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Shares are listed, and any
applicable Federal or state laws, and the Committee may cause a legend or
legends to be put on any such certificates to make appropriate reference to such
restrictions.

     6. Transferability. Except as otherwise determined by the Committee
pursuant to its authority under Section 14(a)(iii) of the Plan, the Option is
nontransferable during the

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Participant’s lifetime, except for transfers by the Participant to family
members (or trusts for their benefit) pursuant to the terms of the Plan.

     7. Withholding.

               (a) The Participant may be required to pay to the Company or any
Affiliate and the Company or any Affiliate shall have the right and is hereby
authorized to withhold from any payment due or transfer made under the Option or
under the Plan or from any compensation or other amount owing to a Participant
the amount (in cash, Shares, other securities, other Awards or other property)
of any applicable federal, state or local income tax withholding requirements in
respect of the Option, its exercise, or any payment or transfer under the Option
or under the Plan and to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for the payment of such taxes,
provided, however, that in no event shall the amount so withheld by the Company
exceed the minimum withholding rates required by applicable statutes.

               (b) Without limiting the generality of clause (a) above, the
Participant may satisfy, in whole or in part, the foregoing withholding
liability by delivery of Shares owned by the Participant (which are not subject
to any pledge or other security interest and which have been owned by the
Participant for at least 6 months) with a Fair Market Value equal to such
withholding liability or by having the Company withhold from the number of
Shares otherwise issuable pursuant to the exercise of the option a number of
Shares with a Fair Market Value equal to such withholding liability.

     8. Securities Laws. Upon the acquisition of any Shares pursuant to the
exercise of the Option, the Participant will make or enter into such written
representations, warranties and agreements as the Committee may reasonably
request in order to comply with applicable securities laws or with this
Agreement.

     9. Notices. Any notice necessary under this Agreement shall be addressed to
the Company in care of its Secretary at the principal executive office of the
Company and to the Participant at the address appearing in the personnel records
of the Company for the Participant or to either party at such other address as
either party hereto may hereafter designate in writing to the other. Any such
notice shall be deemed effective upon receipt thereof by the addressee.

     10. Option Subject to Plan. By accepting this Agreement and the Award
evidenced hereby, the Participant agrees and acknowledges that the Participant
has received and read a copy of the Plan. The Option is subject to the Plan. The
terms and provisions of the Plan as it may be amended from time to time are
hereby incorporated herein by reference. In the event of a conflict between any
term or provision contained herein and a term or provision of the Plan, the
applicable terms and provisions of the Plan will govern and prevail.

     11. Failure to Enforce Not a Waiver. The failure of the Company to enforce
at any time any provision of this Agreement shall in no way be construed to be a
waiver of such provision or of any other provision hereof.

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     12. Authority of Committee. The Committee shall have full authority to
interpret and construe the terms of the Plan and this Agreement. The
determination of the Committee as to any such matter of interpretation or
construction shall be final, conclusive and binding.

     13. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.

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     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and the Participant has hereunto set his hand, effective as of the Date
of Grant.

                  POLO RALPH LAUREN CORPORATION
 
           
 
           

  By:       /s/ Mitchell A. Kosh          

          Mitchell A. Kosh

          Senior Vice President — Human Resources
 
           

          /s/ Ralph Lauren           Participant:     Ralph Lauren

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