Exhibit 10.77

 

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Fiscal Year 2006 Management

Incentive Plan

 

This document contains the terms and conditions of the Perry Ellis
International, Inc. Fiscal Year 2006 Management Incentive Plan, as may be
amended from time to time (the “Plan”), is effective as of February 1, 2005 and
expires on January 31, 2010.

 

I. Objectives

 

The objectives of the Plan are to:

 

  A. improve Company and individual performance through annual financial
incentives which provide rewards to employees whose activities significantly
affect the Company’s sales and profitability;

 

  B. support the Company’s planning efforts and encourage cooperation and group
effort towards the attainment of business goals;

 

  C. help attract and retain outstanding management employees.

 

II. Eligibility

 

Eligibility under the Plan is limited to Divisional President, Executive Vice
President, Senior Vice President, Vice President, and Director-level positions
and such other as approved annually by the Chief Executive Officer of the
Company. The Company’s employees are eligible to a bonus in such amounts as
determined by the Committee on an annual basis.

 

III. Performance Criteria

 

The performance criteria used under the Plan for determining Awards will be
based on corporate and area of responsibility measures or such other measures as
established by the Committee.

 

V. Payment of Awards

 

Awards will be paid as soon as practicable following the end of the fiscal
business year. Awards will be made in cash, less legally required and voluntary
deductions.

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VI. Administration

 

  A. Newly eligible Participants will receive pro-rated payments, based on full
weeks of participation. Participants transferring to an ineligible position at
the Company’s request may be eligible for a pro-rata award for that portion of
the year in which he or she was functioning in an eligible position for the
incentive award.

 

  B. A Participant’s annual performance rating must be 3.0 or higher to be
eligible to receive any payments under the Plan.

 

  C. The Participant must be an active employee of the Company on the date in
which the Awards are made, and not have given notice of intention to resign from
the Company, to be eligible to receive the Award.

 

  D. A Participant whose employment with the Company is terminated due to
retirement, permanent disability or death will be eligible for a pro-rated
share, based on the full weeks worked in the fiscal year in which such
termination occurred. Such payment will be calculated and paid at the same time
as all other payments under the Plan are calculated and paid.

 

  E. A Participant whose employment is terminated for any reason other than
retirement, permanent disability or death will not be eligible for an Award for
the fiscal year in which his/her service is terminated. Additionally, such
terminating employee will not be eligible for an Award for any prior fiscal year
when notice of termination is given by the employee prior to such time as Awards
for that prior year are paid. In the case of death, the payment will be made to
the participant’s estate.

 

  F. Participation in the Plan does not in any way represent an explicit or
implied right to receive an Award pursuant to the terms of the Plan.

 

  G. Awards are based on the sole discretion of the Committee of the Board and
may be increased, reduced or canceled at the discretion of the Committee.

 

  H. No Participant has any right to an Award until such payment has been
authorized by the Committee.

 

  I. Awards will be computed by the Company in its sole discretion and on the
basis of the Company’s financial statements prepared in accordance with
acceptable accounting practices.

 

  J. The Committee shall have full power and final authority to construe,
interpret and administer the Plan and determine all questions as to the status
and rights of Participants under the Plan.

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  K. The Board and its committees and management are not liable for any action
taken or omitted under the Plan.

 

  L. No benefit payable under the Plan shall be subject in any manner to
assignment, sale, transfer, pledge, garnishment, attachment, execution,
sequestration, levy, or any other legal or equitable encumbrance or process of
any kind, and any attempt to do so shall be void and of no force or effect.

 

  M. Participation in the Plan does not alter the at-will nature of the
Participant’s employment, nor does it represent an employment agreement.

 

VII. Amendments and Termination

 

The Committee may at any time, or from time to time, amend, suspend or terminate
the Plan, including the current year, with or without prior notice.

 

VIII. Definitions

 

As used in the Plan, the terms below shall have the following meanings:

 

  A. “Award” and “Incentive Award” shall mean a payment made to a Participant
pursuant to Plan provisions contingent upon or measured by the attainment of the
specified performance objective.

 

  B. “Board” shall mean the Board of Directors of Perry Ellis International,
Inc.

 

  C. “Committee” shall mean the Compensation Committee of the Board.

 

  D. “Company” shall mean Perry Ellis International, Inc., its subsidiaries and
affiliates or any successor company or subsidiary company designated by the
Board for which employees could be included in the Plan.

 

  E. “Disability” shall mean permanent disability as determined by the Committee
in accordance with standards and procedures similar to those under the Company’s
long-term disability plan.

 

  F. “Participant” shall mean an employee of the Company, working in an
incentive-eligible position.

 

  G. “Retirement” shall mean the voluntary termination of employment by an
employee at or after the age of 65 for reasons other than the violation of
Company policy or unsatisfactory performance.

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ACKNOWLEDGEMENT FORM

 

I acknowledge that I have received a copy of the Perry Ellis International, Inc.
Fiscal Year 2006 Management Incentive Plan (“Plan”) and that I am expected to
read and understand its content. I understand that participation in the Plan
does not change the “at-will” nature of my employment with Perry Ellis
International and is not a guarantee that any payment will be made to me under
the Plan. I also understand that if I fail to meet the eligibility requirements
and conditions specified in the Plan I will not receive an incentive plan
payout.

 

 

 

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Signature   Date

 

 

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Print Name   Department

 

Please return this form to Human Resources. Thank you.

 

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