EXHIBIT 10.2
 
EXECUTION COPY
 
RALPH LAUREN CORPORATION
 
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
 
THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made effective as of the 1st day
of November, 2013 (the “Effective Date”), by and between Ralph Lauren
Corporation, a Delaware corporation (the “Corporation”), and Jackwyn Nemerov
(the “Executive”).
 
WHEREAS, the Executive has been employed with the Corporation pursuant to an
Employment Agreement dated October 14th, 2009 (the “2009 Employment Agreement”),
which terminated on March 31, 2013; and
 
WHEREAS, the Corporation and Executive wish to amend and restate such 2009
Employment Agreement effective as of the date hereof;
 
NOW THEREFORE, in consideration of the mutual covenants and premises contained
herein, the parties hereby agree as follows:
 
ARTICLE I
EMPLOYMENT
 
1.1           Employment Term.  The Corporation hereby agrees to employ the
Executive, and the Executive hereby agrees to serve the Corporation, on the
terms and conditions set forth herein, and in the Executive’s term sheet dated
September 17, 2013, a copy of which is attached hereto as Exhibit 1 (the “Term
Sheet”).  The employment of the Executive by the Corporation shall be effective
as of the date hereof and shall continue until the close of business on April 1,
2017 (the “Term”), unless terminated earlier in accordance with Article II
hereof.  The Term shall be automatically extended so as to end on the last day
of each subsequent fiscal year thereafter unless either party notifies the other
in writing of its intention not to extend the Term at least 180 days prior to
the commencement of the next scheduled extension (a “NonExtension Notice”).
 
1.2           Position and Duties.  During the Term, the Executive shall
faithfully, and in conformity with the directions of the Board of Directors of
the Corporation and any Committee thereof (the “Board”) or the Chief Executive
Officer of the Corporation, perform the duties of her employment, and shall
devote to the performance of such duties her full time and attention.  During
the Term, the Executive shall serve in the position of President and Chief
Operating Officer.  During the Term, the Executive may engage in outside
activities provided those activities do not conflict with the duties and
responsibilities enumerated hereunder, and provided further that the Executive
receives written approval in advance from the Corporation for any outside
business activity that may require significant expenditure of the Executive’s
time in which the Executive plans to become involved, whether or not such
activity is pursued for profit.  The Executive shall be excused from performing
any services hereunder
 
 
 
 
 
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during periods of temporary incapacity and during vacations in accordance with
the Corporation’s disability and vacation policies.
 
1.3           Place of Performance.  The Executive shall be employed at the
principal offices of the Corporation located in New York, New York, except for
required travel on the Corporation’s business.
 
1.4           Compensation and Related Matters.
 
(a)           Base Compensation.  In consideration of her services during the
Term, the Corporation shall pay the Executive cash compensation at an annual
rate of not less than one million dollars ($1,000,000) (“Base Compensation”),
less applicable withholdings.  Executive’s Base Compensation shall be subject to
such increases as may be approved by the Board or the Chief Executive
Officer.  The Base Compensation shall be payable as current salary, in
installments not less frequently than monthly, and at the same rate for any
fraction of a month unexpired at the end of the Term.
 
(b)           Bonus.  During the Term, the Executive shall have the opportunity
to earn an annual bonus in accordance with any annual bonus program that the
Corporation maintains that would be applicable to the Executive and that is in
accordance with the Executive’s Term Sheet.
 
(c)           Stock Awards.  During the Term, the Executive shall be eligible to
participate in the Ralph Lauren Corporation 2010 Long-Term Stock Incentive Plan,
or any successor thereto (the “Incentive Plan”).  All grants to the Executive of
stock options, restricted shares and restricted performance share units
(“RPSUs”), if any, are governed by the terms of the Incentive Plan and are
subject, in all cases, to approval by the Compensation and Organizational
Development Committee of the Board of Directors (the “Compensation Committee”)
in its sole discretion.  In accordance with the Executive’s Term Sheet and with
the terms of the Incentive Plan, the Executive shall receive, during the Term,
annual grants of stock options and RPSUs that are equivalent to the award
amounts specified in the Executive’s Term Sheet, subject to Executive’s
continued employment at the time of each such grant.  Such stock options and
RPSUs shall vest in accordance with the terms of the Incentive Plan.
 
(d)           Car and Driver Allowance.  During the Term, the Corporation shall
reimburse the Executive for the use of a car and driver.
 
(e)           Expenses.  During the Term, the Executive shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred by the
Executive in performing services hereunder, including all reasonable expenses of
travel and living while away from home, provided that such expenses are incurred
and accounted for in accordance with the policies and procedures established by
the Corporation.
 
(f)           Vacations.  During the Term, the Executive shall be entitled to
the number of vacation days in each fiscal year, and to compensation in respect
of earned but
 
 
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unused vacation days, determined in accordance with the Corporation’s vacation
program.  The Executive shall also be entitled to all paid holidays given by the
Corporation to its employees.
 
(g)           Other Benefits.  The Executive shall be entitled to participate in
all of the Corporation’s employee benefit plans and programs in effect during
the Term as would by their terms be applicable to the Executive, including,
without limitation, any pension and retirement plan, supplemental pension and
retirement plan, deferred compensation plan, incentive plan, stock option plan,
life insurance plan, medical insurance plan, dental care plan, accidental death
and disability plan, and vacation, sick leave or personal leave program.  The
Corporation shall not make any changes in such plans or programs that would
adversely affect the Executive’s benefits thereunder, unless such change occurs
pursuant to a program applicable to other similarly situated employees of the
Corporation and does not result in a proportionately greater reduction in the
rights or benefits of the Executive as compared with other similarly situated
employees of the Corporation. Except as otherwise specifically provided herein,
nothing paid to the Executive under any plan or program presently in effect or
made available in the future shall be in lieu of the Base Compensation or any
bonus payable under Sections 1.4(a) and 1.4(b) hereof.
 
(h)           Air Travel.  For purposes of security and efficiency, the
Executive and her family members, to and only to the extent such family members
are traveling with the Executive, may use the Corporation’s aircraft for any of
Executive’s travel.
 
ARTICLE II
TERMINATION OF EMPLOYMENT
 
2.1           Termination of Employment.  The Executive’s employment may
terminate prior to the expiration of the Term under the following circumstances:
 
(a)           Without Cause.  The Executive’s employment may terminate upon the
Corporation notifying the Executive that her services will no longer be
required.
 
(b)           Death.  The Executive’s employment shall terminate upon the
Executive’s death.
 
(c)           Disability.  If, as a result of the Executive’s incapacity due to
physical or mental illness, the Executive shall have been absent and unable to
perform the duties hereunder on a full-time basis for an entire period of six
consecutive months, the Executive’s employment may be terminated by the
Corporation following such six-month period.
 
(d)           Cause.  The Corporation may terminate the Executive’s employment
for Cause.  For purposes hereof, “Cause” shall mean: (1) the willful and
continued failure by the Executive to substantially perform her duties hereunder
after demand for substantial performance is delivered to her by the Corporation
that specifically identifies the manner in which the Corporation believes the
Executive has not substantially performed her duties, (2) Executive’s conviction
of, or plea of nolo contendere to, a crime (whether or not involving the
Corporation) constituting any felony or (3) the willful engaging by the
Executive
 
 
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in gross misconduct relating to the Executive’s employment that is materially
injurious to the Corporation, monetarily or otherwise (including, but not
limited to, conduct that constitutes competitive activity, in violation of
Article III) or which subjects, or if generally known would subject, the
Corporation to public ridicule.  For purposes of this paragraph, no act, or
failure to act, on the Executive’s part shall be considered “willful” unless
done, or omitted to be done, by her not in good faith and without reasonable
belief that her action or omission was in the best interest of the
Corporation.  Notwithstanding the foregoing, the Executive’s employment may
be terminated for Cause only by act of the Board and, in any event, the
Executive’s employment shall not be deemed to have been terminated for Cause
without (x) reasonable written notice to the Executive setting forth the reasons
for the Corporation’s intention to terminate for Cause, (y) the opportunity to
cure (if curable) within 30 days of such written notice of the event(s) giving
rise to such notice and (z) an opportunity for the Executive, together with her
counsel, to be heard by the Board.
 
(e)           Voluntary Termination.  The Executive may voluntarily terminate
the Executive’s employment with the Corporation at any time, with or without
Good Reason.  For purposes of this Agreement, “Good Reason” shall mean a
termination of employment by the Executive within one (1) year following the
occurrence of (A) a material diminution in or adverse alteration to Executive’s
title, base salary, benefits, position, status or duties, provided that the
removal of particular business units or functions from Executive’s purview shall
not constitute a material diminution in or adverse alteration to the Executive’s
“duties” for this purpose, (B) the relocation of the Executive’s principal
office outside the area which comprises a fifty (50) mile radius from New York
City, (C) a failure of the Corporation to comply with any material provision of
this Agreement, or (D) the Corporation requires the Executive to report to any
person other than Ralph Lauren or to the Board; provided, that the events
described in clauses (A), (B), (C) and (D) above shall not constitute Good
Reason (1) until the Executive provides written notice to the Corporation of the
existence of such diminution, change, reduction, relocation or failure within
ninety (90) days of its occurrence and (2) unless such diminution, change,
reduction or failure (as applicable) has not been cured within thirty (30) days
after written notice of such noncompliance has been given by the Executive to
the Corporation.
 
2.2           Nonrenewal.  The Executive’s employment hereunder shall terminate
at the end of the Term if either party elects not to extend the Term of this
Agreement by delivery of a NonExtension Notice as contemplated by Section 1.1.
 
2.3           Date of Termination.  The date of termination shall be:
 
(a)           if the Executive’s employment is terminated by the Executive’s
death, the date of the Executive’s death;
 
(b)           if the Executive’s employment is terminated by reason of
Executive’s disability pursuant to Section 2.1(c) or by the Corporation pursuant
to Sections 2.1(a) or 2.1(d), the date specified by the Corporation;
 
 
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(c)           if the Executive’s employment is terminated by the Executive, the
date on which the Executive notifies the Corporation of her termination; and
 
(d)           if the Executive’s employment is terminated by reason of the
NonExtension Notice pursuant to Section 2.2, the expiration date of the Term.
 
2.4           Effect of Termination of Employment.
 
(a)           Except as provided in Section 2.4(b), if the Executive’s
employment is terminated by the Corporation Without Cause pursuant to Section
2.1(a), or if the Executive resigns for Good Reason pursuant to Section 2.1(e),
the Executive shall only be entitled to the following:
 
(i)           Severance.  Subject to Section 4.1(a) hereof, the Corporation
shall: (a) beginning with the first payroll period following the forty-fifth
(45th) day following the date of termination of Executive’s employment, continue
to pay the Executive, in accordance with the Corporation’s normal payroll
practice, Executive’s Base Compensation, as in effect immediately prior to such
termination of employment, for the longer of the balance of the Term or the
one-year period commencing on the date of such termination, provided that under
no circumstances shall Executive be paid her Base Compensation for a period
longer than two years (whichever period is applicable shall be referred to
herein as the “Severance Period”), and provided that the initial payment shall
include Base Compensation amounts for all payroll periods from the date of
termination through the date of such initial payment; and (b) pay to the
Executive, on the last business day of the Severance Period, an amount equal to
the Executive’s target bonus as in effect at the time of termination of
Executive’s employment (the “Target Bonus”).  Notwithstanding the foregoing, if
the Company provides the Executive with a release and waiver of claims against
the Corporation, its successors, affiliates, and assigns, no later than fifteen
(15) days after the Executive’s date of termination, in order to receive any
severance benefits under this Section 2.4(a)(i), or any awards under Section
2.4(a)(ii) below, the Executive must sign such release and waiver of claims
against the Corporation, its successors, affiliates, and assigns, in a form
acceptable to the Corporation and such release must become irrevocable on or
prior to the forty-fifth (45th) day following the date of termination of
Executive’s employment.
 
(ii)           Stock Awards.  The Executive shall immediately vest in any
unvested stock options (or other equity awards with only service-based vesting
conditions) as of the date of termination of the Executive’s employment.  With
respect to vested stock options, if any (including stock options that vest
pursuant to the preceding sentence), the Executive shall have one year from the
date of termination of Executive’s employment to exercise such vested options,
but in no event later than the expiration date of such vested options.  With
respect to any unvested pro-rata RPSUs and unvested cliff RPSUs (or any other
equity awards with performance-based vesting conditions) awarded through the
date on which the Executive’s employment terminates, except as provided for in
Section 4.1(a): (1) any unvested pro-rata RPSUs (or other performance-based
equity awards with pro-rata vesting) will fully vest upon the Corporation’s
attainment of the applicable performance goals and will be paid in their
entirety as per the terms of the Incentive Plan as soon as practicable (but in
no event later than 30 days) after each applicable vesting date without regard
to Executive’s
 
 
 
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continued employment; and (2) any unvested cliff RPSUs (or other
performance-based equity awards with cliff vesting) will remain outstanding and
will vest at the end of the applicable performance period based on the
Corporation’s actual degree of achievement of the applicable performance goals,
and any such awards will be paid in their entirety as per the terms of the
Incentive Plan as soon as practicable (but in no event later than 30 days) after
each applicable vesting date, without regard to Executive’s continued
employment.
 
(iii)           Welfare Plan Coverages.  The Executive shall continue to
participate during the Severance Period in any group medical, dental or life
insurance plan she participated in prior to the date of her termination, under
substantially similar terms and conditions as an active employee (i.e., the
Corporation will continue to pay the Corporation’s portion of the costs of such
participation); provided, that participation in such group medical, dental or
life insurance plan shall correspondingly cease at such time as the Executive
becomes eligible for a future employer’s medical, dental and/or life insurance
coverage (or would become eligible if the Executive did not waive coverage).
 
(iv)           Retirement Plans.  Without limiting the generality of the
foregoing, it is specifically provided that the Executive shall not accrue
additional benefits under any pension plan of the Corporation (whether or not
qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended)
during the Severance Period.
 
(b)           If the Executive resigns for Good Reason pursuant to Section
2.1(e)(D) as a result of being required to report to a Chief Executive Officer
other than Ralph Lauren then, subject to Section 4.1(a) hereof, the Executive
shall only be entitled to the following:
 
(i)           Severance.  The Corporation shall: (a) beginning with the first
payroll period following the forty-fifth (45th) day following the date of
termination of Executive’s employment, continue to pay the Executive, in
accordance with the Corporation’s normal payroll practice, Executive’s Base
Compensation, as in effect immediately prior to such termination of employment,
for the one-year period commencing on the date of such termination (the “Special
Severance Period”), and provided that the initial payment shall include Base
Compensation amounts for all payroll periods from the date of termination
through the date of such initial payment; and (b) pay to the Executive, on the
last business day of the Special Severance Period, the Target
Bonus.  Notwithstanding the foregoing, if the Company provides the Executive
with a release and waiver of claims against the Corporation, its successors,
affiliates, and assigns, no later than fifteen (15) days after the Executive’s
date of termination, in order to receive any severance benefits under this
Section 2.4(b)(i), or any awards under Section 2.4(b)(ii) below, the Executive
must sign such release and waiver of claims against the Corporation, its
successors, affiliates, and assigns, in a form acceptable to the Corporation and
such release must become irrevocable on or prior to the forty-fifth (45th) day
following the date of termination of Executive’s employment.
 
(ii)           Stock Award.  The Executive shall continue to vest in all
unvested stock awards outstanding as of the date of termination of the
Executive’s employment as if the Executive's employment had continued during the
Special Severance Period and all stock options held by the Executive and
outstanding as of the date of termination of Executive’s employment shall remain
outstanding as if the Executive's
 
 
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employment had continued during the Special Severance Period.
 
(iii)           Welfare Plan Coverages.  The Executive shall continue to
participate during the Special Severance Period in any group medical, dental or
life insurance plan she participated in prior to the date of her termination,
under substantially similar terms and conditions as an active employee (i.e.,
the Corporation will continue to pay the Corporation’s portion of the costs of
such participation); provided, that participation in such group medical, dental
or life insurance plan shall correspondingly cease at such time as the Executive
becomes eligible for a future employer’s medical, dental and/or life insurance
coverage (or would become eligible if the Executive did not waive coverage).
 
(iv)           Retirement Plans.  Without limiting the generality of the
foregoing, it is specifically provided that the Executive shall not accrue
additional benefits under any pension plan of the Corporation (whether or not
qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended)
during the Special Severance Period.
 
(c)           If the Executive’s employment is terminated by reason of the
Executive’s death or disability, pursuant to Section 2.1(b) or 2.1(c), the
Corporation shall pay any amounts due to the Executive through the date of her
death or the date of her termination due to disability, including a Pro Rata
Target Annual Incentive Bonus (as defined below), in a lump sum within
forty-five (45) days following such termination of employment, and the treatment
of any then outstanding stock awards shall be as set forth in Section
2.4(a)(ii); provided, that any then outstanding stock options shall be
exercisable by the Executive (or, in the case of death, her estate) until the
earlier to occur of (I) the third anniversary of the date of such termination of
employment and (II) the expiration date of such option term.  Except as provided
in this Section 2.4(c), the Corporation will have no further obligations to the
Executive under this Agreement following the Executive’s termination of
employment under the circumstances described in this Section 2.4(c).  For
purposes of this Agreement, the term “Pro Rata Target Annual Incentive Bonus”
means the Target Bonus multiplied by a fraction, the numerator of which is the
number of days from the first day of the fiscal year in which such termination
occurs until the date of termination and the denominator of which is 365.
 
(d)           If the Executive’s employment is terminated by the Corporation for
Cause or by the Executive without Good Reason, the Executive shall receive only
that portion of the Executive’s then current Base Compensation payable through
the Executive’s termination date.  The Executive’s rights with respect to any
stock awards provided to the Executive by the Corporation shall be governed by
the provisions of the Corporation’s Incentive Plan and the respective award
agreements, if any, under which such stock awards were provided.
 
(e)           If the Executive’s employment terminates at the end of the Term as
a result of delivery by either party of a NonExtension Notice as contemplated by
Section 1.1, then subject to Article III hereof, (i) the Executive shall be
entitled to any annual bonus payable with respect to the Corporation’s fiscal
year in which the Term ends, such annual bonus to be payable when such annual
bonus would have otherwise been paid pursuant to Section 1.4(b) had the
Executive’s employment not terminated; (ii) the Executive shall be
 
 
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entitled to the benefits set forth in Section 2.4(a)(ii) hereof, and (iii)
except as set forth in this sentence and, if applicable, the following sentence,
Executive’s rights shall otherwise be as set forth in Section 2.4(d) hereof.  If
the Executive’s employment terminates at the end of the Term as a result of the
Corporation’s delivery of a NonExtension Notice as contemplated by Section 1.1,
the Corporation shall (x) beginning with the first payroll period following the
forty-fifth (45th) day following the date of termination of Executive's
employment, continue to pay the Executive, in accordance with the Corporation’s
normal payroll practice, Executive’s Base Compensation, as in effect immediately
prior to such termination of employment, for the one-year period commencing on
the date of termination (the “NonExtension Period”) and (y) pay the Executive,
on the last business day of the NonExtension Period, the Target Bonus
(collectively, the “NonExtension Severance”).  Notwithstanding the foregoing, if
the Company provides the Executive with a release and waiver of claims against
the Corporation, its successors, affiliates, and assigns, no later than fifteen
(15) days after the Executive’s date of termination, in order to receive the
NonExtension Severance, the Executive must sign such release and waiver of
claims against the Corporation, its successors, affiliates, and assigns, in a
form acceptable to the Corporation and such release must become irrevocable on
or prior to the forty-fifth (45th) day following the date of termination of
Executive’s employment.
 
ARTICLE III
COVENANTS OF THE EXECUTIVE
 
3.1           Non-Compete.
 
(a)           The Corporation and the Executive acknowledge that: (i) the
Corporation has a special interest in and derives significant benefit from the
unique skills and experience of the Executive; (ii) the Executive will use and
have access to proprietary and valuable Confidential Information (as defined in
Section 3.2 hereof) during the course of the Executive’s employment; and (iii)
the agreements and covenants contained herein are essential to protect the
business and goodwill of the Corporation or any of its subsidiaries, affiliates
or licensees.  Accordingly, except as hereinafter noted, the Executive covenants
and agrees that during the Term and for the period of one (1) year following the
termination of Executive’s employment for any reason, the Executive shall not
provide any labor, work, services or assistance (whether as an officer,
director, employee, partner, agent, owner, independent contractor, consultant,
stockholder or otherwise) to a “Competing Business.”  For purposes hereof,
“Competing Business” shall mean any business engaged in the designing, marketing
or distribution of premium lifestyle products, including but not limited to
apparel, home, accessories and fragrance products, which competes in any
material respects with the Corporation or any of its subsidiaries, affiliates or
licensees, and shall include, without limitation, those brands and companies
that the Corporation and the Executive have jointly designated in writing on the
date hereof, which is incorporated herein by reference and which is attached as
Schedule A, as being in competition with the Corporation or any of its
subsidiaries, affiliates or licensees as of the date hereof.  Thus, Executive
specifically acknowledges that Executive understands that she may not become
employed by any Competing Business in any capacity during the time periods in
which she is restricted herein, provided that the Executive may own, solely as
an investment, securities of any entity which are traded on a national
securities exchange if the Executive is not a controlling person of, or a member
of a group that
 
 
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controls such entity and does not, directly or indirectly, own 2% or more of any
class of securities of such entity.
 
(b)           It is acknowledged by the Executive that the Corporation has
determined to relieve the Executive from any obligation of non-competition upon
the expiration of one (1) year following the termination of Executive’s
employment for any reason.  In consideration of that, and in consideration of
all of the compensation provisions in this Agreement (including the potential
for the award of stock options, restricted shares and/or RPSUs and severance
payments that may be provided to the Executive), Executive agrees to the
provisions of Section 3.1(a) and also agrees that the non-competition
obligations imposed herein are fair and reasonable under all the circumstances.
 
3.2           Confidential Information.
 
(a)           The Corporation owns and has developed and compiled, and will own,
develop and compile, certain proprietary techniques and confidential information
as described below which have great value to its business (referred to in this
Agreement, collectively, as “Confidential Information”).  Confidential
Information includes not only information disclosed by the Corporation and/or
its affiliates, subsidiaries and licensees to Executive, but also information
developed or learned by Executive during the course of, or as a result of,
employment hereunder, which information Executive acknowledges is and shall be
the sole and exclusive property of the Corporation.  Confidential Information
includes all proprietary information that has or could have commercial value or
other utility in the business in which the Corporation is engaged or
contemplates engaging, and all proprietary information the unauthorized
disclosure of which could be detrimental to the interests of the
Corporation.  Whether or not such information is specifically labeled as
Confidential Information by the Corporation is not determinative.  By way of
example and without limitation, Confidential Information includes any and all
information developed, obtained or owned by the Corporation and/or its
subsidiaries, affiliates or licensees concerning trade secrets, techniques,
know-how (including designs, plans, procedures, processes and research records),
software, computer programs, innovations, discoveries, improvements, research,
development, test results, reports, specifications, data, formats, marketing
data and plans, business plans, strategies, forecasts, unpublished financial
information, orders, agreements and other forms of documents, price and cost
information, merchandising opportunities, expansion plans, designs, store plans,
budgets, projections, customer, supplier and subcontractor identities,
characteristics and agreements, and salary, staffing and employment
information.  Notwithstanding the foregoing, Confidential Information shall not
in any event include (A) Executive’s personal knowledge and know-how relating to
merchandising and business techniques which Executive has developed over her
career in the apparel business and of which Executive was aware prior to her
employment, or (B) information which (i) was generally known or generally
available to the public prior to its disclosure to Executive; (ii) becomes
generally known or generally available to the public subsequent to disclosure to
Executive through no wrongful act of any person or (iii) which Executive is
required to disclose by applicable law or regulation (provided that Executive
provides the Corporation with prior notice of the contemplated disclosure and
reasonably cooperates with the Corporation at the Corporation’s expense in
seeking a protective order or other appropriate protection of such information).
 
 
 
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(b)           Executive acknowledges and agrees that in the performance of her
duties hereunder the Corporation will from time to time disclose to Executive
and entrust Executive with Confidential Information.  Executive also
acknowledges and agrees that the unauthorized disclosure of Confidential
Information, among other things, may be prejudicial to the Corporation’s
interests, and an improper disclosure of trade secrets.  Executive agrees that
she shall not, directly or indirectly, use, make available, sell, disclose or
otherwise communicate to any corporation, partnership, individual or other third
party, other than in the course of her assigned duties and for the benefit of
the Corporation, any Confidential Information, either during her Term of
employment or thereafter.
 
(c)           The Executive agrees that upon leaving the Corporation’s employ,
the Executive shall not take with the Executive any software, computer programs,
disks, tapes, research, development, strategies, designs, reports, study,
memoranda, books, papers, plans, information, letters, e-mails, or other
documents or data reflecting any Confidential Information of the Corporation,
its subsidiaries, affiliates or licensees.
 
(d)           During the Term, Executive shall disclose to the Corporation all
designs, inventions and business strategies or plans developed for the
Corporation, including without limitation any process, operation, product or
improvement.  Executive agrees that all of the foregoing are and shall be the
sole and exclusive property of the Corporation and that Executive shall at the
Corporation’s request and cost do whatever is necessary to secure the rights
thereto, by patent, copyright or otherwise, to the Corporation.
 
3.3           Non-Solicitation of Employees.  The Executive covenants and agrees
that during the Term, and for a period of two (2) years following the
termination of Executive’s employment for any reason whatsoever hereunder, the
Executive shall not directly or indirectly solicit or influence any other
employee of the Corporation, or any of its subsidiaries, affiliates or
licensees, to terminate such employee’s employment with the Corporation, or any
of its subsidiaries, affiliates or licensees, as the case may be, or to become
employed by a Competing Business.  As used herein, “solicit” shall include,
without limitation, requesting, encouraging, enticing, assisting, or causing,
directly or indirectly.
 
3.4           Nondisparagement. The parties agree that during the Term and
thereafter whether or not the Executive is receiving any amounts pursuant to
Sections 2.3 and 4.1, the parties shall not make any statements or comments that
reasonably could be considered to shed an adverse light on the Executive or the
business or reputation of the Corporation or any of its subsidiaries, affiliates
or licensees, the Board or any officer of the Corporation or any of its
subsidiaries, affiliates or licensees; provided, however, the foregoing
limitation shall not apply to (i) compliance with legal process or subpoena, or
(ii) statements in response to an inquiry from a court or regulatory body.
 
3.5           Remedies.
 
(a)           If the Executive breaches, or threatens to commit a breach of, any
of the provisions of this Article III, the Corporation shall have the following
rights and remedies, each of which rights and remedies shall be independent of
the other and severally
 
 
 
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enforceable, and all of which rights and remedies shall be in addition to, and
not in lieu of, any other rights and remedies available to the Corporation under
law or equity:
 
(i)           The right and remedy to have the obligations specifically enforced
by any court having equity jurisdiction, it being acknowledged and agreed that
any such breach or threatened breach of such obligations in this Article III
will cause irreparable injury to the Corporation and that money damages will not
provide an adequate remedy to the Corporation; and
 
(ii)           The right to discontinue the payment of any amounts owing to the
Executive under the Agreement; provided that the Corporation shall have secured
a reasoned opinion of counsel that the Executive’s activities constitute a
material breach of the obligations in this Article III and which shall have been
provided to the Executive, the delivery of which shall not be deemed to be a
waiver of any applicable privilege. To the extent Executive, by notice
hereunder, disputes the discontinuance of any payments hereunder, such payments
shall be segregated and deposited in an interest bearing account at a major
financial center bank in New York City pending resolution of the dispute.
 
(b)           If any court or arbitrator determines that any of the obligations
in this Article III, or any part thereof, is invalid or unenforceable, the
remainder of the obligations in this Article III shall not thereby be affected
and shall be given full effect, without regard to the invalid portion. In
addition, if any court or arbitrator construes any of the obligations in this
Article III, or any part thereof, to be unenforceable because of the duration of
such provision or the area covered thereby, such court shall have the power to
reduce the duration or area of such provision and, in its reduced form, such
provision shall then be enforceable and shall be enforced.
 
3.6           The provisions of this Article III shall survive the termination
of this Agreement and Executive’s Term of employment.
 
ARTICLE IV
CHANGE IN CONTROL
 
4.1           Change in Control.
 
(a)           Effect of a Change in Control.  Notwithstanding anything contained
herein to the contrary, if the Executive’s employment is terminated within
twelve (12) months following a Change in Control (as defined in Section 4.1(b)
hereof) during the Term by the Corporation for any reason other than Cause, or
by the Executive for Good Reason, then:
 
(i)           Severance.  The Corporation shall pay to the Executive, in lieu of
any amounts otherwise due to her under Section 2.4(a) hereof, within fifteen
(15) days of the Executive’s termination of employment, or within the timeframe
required by Section 5.12 hereof if applicable, a lump sum amount equal to two
(2) times the sum of: (A) the Executive’s Base Compensation, as in effect
immediately prior to such termination of employment; and (B) the bonus paid to
the Executive for the most recently completed fiscal
 
 
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year prior to the fiscal year in which her employment is
terminated.Notwithstanding the foregoing, to the extent that any portion of the
severance pay that would have otherwise been due to the Executive under Section
2.4 (had a Change in Control not occurred during the twelve-month period prior
to such termination of employment) would have been subject to Code Section 409A
by reason of its failure to qualify as a short-term deferral for purposes of
Treas. Reg. Section 1.409A-1(b)(4) or as non-deferred separation pay under
Treas. Reg. Section 1.409A-1(b)(9) (the “409A Severance Pay”) and that the
exception set forth in Treas. Reg. Section 1.409A-3(c) is not available, the
409A Severance Pay shall be deducted from the amount otherwise payable in a lump
sum in accordance with the first sentence of this Section 4.1(a)(i) and shall
instead be payable to Executive in the form and on the schedule specified in the
applicable subsection in Section 2.4 as if the Executive’s employment had been
terminated pursuant to the applicable subsection in Section 2.4 hereof rather
than within a twelve-month period following a Change in Control.
 
(ii)           Stock Awards.  The Executive shall immediately become vested in
any unvested stock options granted to the Executive by the Corporation prior to
the Change in Control and Executive will have one (1) year from the date of
termination under this circumstance to exercise all vested options (but in no
event later than the expiration date of such options).  In addition, any other
outstanding equity awards that are unvested shall be deemed vested immediately
prior to such Change in Control.  Payments to the Executive with respect to any
RPSUs (or other equity awards with performance-based vesting conditions) whose
vesting accelerates as described in this Section 4.1(a)(ii) will be calculated
as if any applicable performance goals had been achieved at the specified target
level and made as per the terms of the Incentive Plan but in no event later than
thirty (30) days after the applicable vesting date.
 
(b)           Section 280G.  Notwithstanding the foregoing, (A) in the event the
Corporation (or its successor) and the Executive both determine, based upon the
advice of the independent public accountants for the Corporation, that part or
all of the consideration, compensation or benefits to be paid to the Executive
under this Agreement constitute “parachute payments” under Section 280G(b) (2)
of the Internal Revenue Code of 1986, as amended and the Department of Treasury
Regulations and other interpretive guidance issued thereunder (collectively, the
“Code”), then, if the aggregate present value of such parachute payments,
singularly or together with the aggregate present value of any consideration,
compensation or benefits to be paid to the Executive under any other plan,
arrangement or agreement which constitute “parachute payments” (collectively,
the “Parachute Amount”) exceeds 2.99 times the Executive’s “base amount”, as
defined in Section 280G(b)(3) of the Code (the “Executive Base Amount”), the
amounts constituting “parachute payments” which would otherwise be payable to or
for the benefit of the Executive shall be reduced to the extent necessary so
that the Parachute Amount is equal to 2.99 times the Executive Base Amount (the
“Reduced Amount”); provided that such amounts shall not be so reduced if the
Executive determines, based upon the advice of an independent nationally
recognized public accounting firm (which may, but need not be the independent
public accountants of the Corporation), that without such reduction the
Executive would be entitled to receive and retain, on a net after tax basis
(including, without limitation, any excise taxes payable under
 
 
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Section 4999 of the Code), an amount which is greater than the amount, on a net
after tax basis, that the Executive would be entitled to retain upon her receipt
of the Reduced Amount.
 
(B)           In the case of a reduction in the Parachute Amount pursuant to
Section 4.1(b), the Parachute Amount shall be reduced in the following order:
(i) payments that are payable in cash that are valued at full value under
Treasury Regulation Section 1.280G-1, Q&A 24(a) will be reduced (if necessary,
to zero), with amounts that are payable last reduced first; (ii) payments and
benefits due in respect of any equity valued at full value under Treasury
Regulation Section 1.280G-1, Q&A 24(a), with the highest values reduced first
(as such values are determined under Treasury Regulation Section 1.280G-1, Q&A
24) will next be reduced; (iii) payments that are payable in cash that are
valued at less than full value under Treasury Regulation Section 1.280G-1, Q&A
24, with amounts that are payable last reduced first, will next be reduced; (iv)
payments and benefits due in respect of any equity valued at less than full
value under Treasury Regulation Section 1.280G-1, Q&A 24, with the highest
values reduced first (as such values are determined under Treasury Regulation
Section 1.280G-1, Q&A 24) will next be reduced; and (v) all other non-cash
benefits not otherwise described in clauses (ii) or (iv) will be next reduced
pro-rata.  Within ten days following such determination hereunder, the
Corporation shall pay or distribute to or for the benefit of the Executive such
amounts as are then due to the Executive under this Agreement and shall promptly
pay or distribute to or for the benefit of the Executive such amounts as become
due to the Executive under, and in accordance with the terms of, this Agreement.
 
(C)           As a result of the uncertainty in the application of Section 280G
of the Code at the time of a determination hereunder, it is possible that
payments will be made by the Corporation which should not have been made under
clause (A) of this Section 4.1(b) (“Overpayment”) or that additional payments
which are not made by the Corporation pursuant to clause (A) of this Section
4.1(b) should have been made (“Underpayment”).  In the event that there is a
final determination by the Internal Revenue Service, a final determination by a
court of competent jurisdiction or a change in the provisions of the Code or
regulations pursuant to which an Overpayment arises, any such Overpayment shall
be treated for all purposes as a loan to the Executive which the Executive shall
repay to the Corporation together with interest at the applicable Federal rate
provided for in Section 7872(f)(2) of the Code.  In the event that there is a
final determination by the Internal Revenue Service, a final determination by a
court of competent jurisdiction or a change in the provisions of the Code or
regulations pursuant to which an Underpayment arises under this Agreement, any
such Underpayment shall be promptly paid by the Corporation to or for the
benefit of the Executive, together with interest at the applicable Federal rate
provided for in Section 7872(f)(2) of the Code; but in no event later than the
Executive’s taxable year following the year in which such final determination or
change is made.
 
(c)           Definition.  For purposes hereof, a “Change in Control” shall mean
the occurrence of any of the following:
 
 
 
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(i)           the sale, lease, transfer, conveyance or other disposition, in one
or a series of related transactions, of all or substantially all of the assets
of the Corporation to any “person” or “group” (as such terms are used in
Sections 13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934 (“Act”))
other than Permitted Holders;
 
(ii)           any person or group is or becomes the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Act, except that a person shall be
deemed to have “beneficial ownership” of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 50 percent of the
total voting power of the voting stock of the Corporation, including by way of
merger, consolidation or otherwise; provided, however, that for purposes of this
Agreement, the following acquisitions shall not constitute a Change in Control:
(I) any acquisition by the Corporation or any Affiliate, (II) any acquisition by
any employee benefit plan sponsored or maintained by the Corporation or any
Affiliate, (III) any acquisition by one or more of the Permitted Holders, or
(IV) any acquisition which complies with clauses (A), (B) and (C) of subsection
(v) below;
 
(iii)           during any period of twelve (12) consecutive  months, Present
and/or New Directors cease for any reason to constitute a majority of the Board;
 
(iv)           the Permitted Holders’ beneficial ownership of the total voting
power of the voting stock of the Corporation falls below 30 percent and either
Ralph Lauren is not nominated for a position on the Board of Directors, or he
stands for election to the Board of Directors and is not elected;
 
(v)           the consummation of a reorganization, recapitalization, merger,
consolidation, statutory share exchange or similar form of corporate transaction
involving the Corporation that requires the approval of the Corporation’s
stockholders, whether for such transaction or the issuance of securities in the
transaction (a “Business Combination”), unless immediately following such
Business Combination: (A) more than 50% of the total voting power of (x) the
entity resulting from such Business Combination (the “Surviving Company”), or
(y) if applicable, the ultimate parent entity that directly or indirectly has
beneficial ownership of sufficient voting securities eligible to elect a
majority of the members of the board of directors (or the analogous governing
body) of the Surviving Company (the “Parent Company”), is represented by the
shares of voting stock of the Corporation that were outstanding immediately
prior to such Business Combination (or, if applicable, is represented by shares
into which the shares of voting stock of the Corporation were converted pursuant
to such Business Combination), and such voting power among the holders thereof
is in substantially the same proportion as the voting power was among the
holders of the shares of voting stock of the Corporation that were outstanding
immediately prior to the Business Combination, (B) no person (other than any
employee benefit plan sponsored or maintained by the Surviving Company or the
Parent Company, or one or more Permitted Holders), is or becomes the beneficial
owner, directly or indirectly, of 50% or more of the total voting power of the
outstanding voting securities eligible to elect members of the board of
directors of the Parent Company (or the analogous governing body) (or, if there
is no Parent Company, the Surviving Company) and (C) at least a majority of the
members of the board of directors (or the analogous governing body) of the
Parent Company (or, if there is no Parent Company, the
 
 
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Surviving Company) following the consummation of the Business Combination were
Board members at the time of the Board’s approval of the execution of the
initial agreement providing for such Business Combination; or
 
(vi)           the stockholders of the Corporation approve a plan of complete
liquidation or dissolution of the Corporation.
 
For purposes of this Section 4.1(c), the following terms have the meanings
indicated: “Permitted Holders” shall mean, as of the date of determination: (A)
any and all of Ralph Lauren, his spouse, his siblings and their spouses, and
descendants of them (whether natural or adopted) (collectively, the “Lauren
Group”); and (B) any trust established and maintained primarily for the benefit
of any member of the Lauren Group and any entity controlled by any member of the
Lauren Group.  “Present Directors” shall mean individuals who at the beginning
of any one year period were members of the Board.  “New Directors” shall mean
any directors whose election by the Board or whose nomination for election by
the shareholders of the Corporation was approved by a vote of a majority of the
directors of the Corporation who, at the time of such vote, were either Present
Directors or New Directors but excluding any such individual whose initial
assumption of office occurs solely as a result of an actual or threatened proxy
contest with respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a person other
than the Board.
 
ARTICLE V
MISCELLANEOUS
 
5.1           Notice.  For the purposes of this Agreement, notices, demands and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered by hand or by facsimile
or mailed by United States registered mail, return receipt requested, postage
prepaid, addressed as follows:
 
 
 
If to the Executive:
 
 
 

 
 
with a copy to:
Miriam Wugmeister, Esq.
Morrison & Foerster LLP
1290 Avenue of the Americas
New York, New York 10104
Fax: (212) 468-7900

 
 
If to the Corporation:
Ralph Lauren Corporation
650 Madison Avenue
New York, New York 10022
Attn:  Mitchell A. Kosh
Senior Vice President - Human Resources
Fax: (212) 318-7277

 
 
 
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or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
 
5.2           Modification or Waiver; Entire Agreement; End of Term.  No
provision of this Agreement may be modified or waived except in a document
signed by the Executive and the Corporation.  This Agreement, along with the
Term Sheet and any other documents incorporated herein by reference, constitutes
the entire agreement between the parties regarding their employment relationship
and supersedes all prior agreements, promises, covenants, representations or
warranties, including, without limitation, the Executive’s 2009 Employment
Agreement with the Corporation.  To the extent that this Agreement is in any way
inconsistent with any prior or contemporaneous stock award agreements between
the parties, this Agreement shall control.  No agreements or representations,
oral or otherwise, with respect to the subject matter hereof have been made by
either party that are not set forth expressly in this Agreement.  Any extensions
or renewals of this Agreement must be in writing and must be agreed to by both
the Corporation and the Executive.  Absent such extensions or renewals, this
Agreement and all of its terms and conditions, except for those provisions in
Article III as specified therein, shall expire upon the end of the Term.
 
5.3           Governing Law.  The validity, interpretation, construction,
performance, and enforcement of this Agreement shall be governed by the laws of
the State of New York without reference to New York’s choice of law rules.
 
5.4           Arbitration. The Corporation and the Executive mutually agree that
any controversy or claim arising out of or relating to this Agreement or the
breach thereof, or any other dispute between the parties arising from or related
to Executive’s employment with the Corporation, shall be submitted to mediation
before a mutually agreeable mediator.  In the event mediation is unsuccessful in
resolving the claim or controversy, such claim or controversy shall be resolved
by arbitration.The Corporation and Executive agree that arbitration shall be
held in New York, New York, before a mutually agreed upon single arbitrator
licensed to practice law.  The arbitrator shall have authority to award or grant
legal, equitable, and declaratory relief.  Such arbitration shall be final and
binding on the parties and fees for any arbitration shall be paid by the losing
party.  If the parties are unable to agree on an arbitrator, the matter may be
submitted to JAMS Dispute Resolution solely for appointment of an
arbitrator.  Any fees for mediation shall be split between the parties.  The
provisions of this Section 5.4 shall not apply to any action by the Corporation
seeking relief under Article III of this Agreement.
 
5.5           No Mitigation or Offset.  In the event the Executive’s employment
with the Corporation terminates for any reason, the Executive shall not be
obligated to seek other employment following such termination and there shall be
no offset of the payments or benefits set forth herein.
 
5.6           Withholding.  All payments required to be made by the Corporation
hereunder to the Executive or the Executive’s estate or beneficiaries shall be
subject to the withholding of such amounts as the Corporation may reasonably
determine it should withhold pursuant to any applicable law.
 
 
 
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5.7           Attorney’s Fees.  Each party shall bear its own attorney’s fees
and costs incurred in any action or dispute arising out of this Agreement and/or
the employment relationship.
 
5.8           No Conflict.  Executive represents and warrants that she is not
party to any agreement, contract, understanding, covenant, judgment or decree or
under any obligation, contractual or otherwise, with any other party that in any
way restricts or adversely affects her ability to act for the Corporation in all
of the respects contemplated hereby, including but not limited to any
obligations to comply with any non-compete or non-solicitation provisions.
 
5.9           Enforceability.  Each of the covenants and agreements set forth in
this Agreement are separate and independent covenants, each of which has been
separately bargained for and the parties hereto intend that the provisions of
each such covenant shall be enforced to the fullest extent permissible.  Should
the whole or any part or provision of any such separate covenant be held or
declared invalid, such invalidity shall not in any way affect the validity of
any other such covenant or of any part or provision of the same covenant not
also held or declared invalid.  If any covenant shall be found to be invalid but
would be valid if some part thereof were deleted or the period or area of
application reduced, then such covenant shall apply with such minimum
modification as may be necessary to make it valid and effective.  The failure of
either party at any time to require performance by the other party of any
provision hereunder will in no way affect the right of that party thereafter to
enforce the same, nor will it affect any other party’s right to enforce the
same, or to enforce any of the other provisions in this Agreement; nor will the
waiver by either party of the breach of any provision hereof be taken or held to
be a waiver of any prior or subsequent breach of such provision or as a waiver
of the provision itself.
 
5.10         Miscellaneous.  No right or interest to, or in, any payments shall
be assignable by the Executive; provided, however, that this provision shall not
preclude the Executive from designating in writing one or more beneficiaries to
receive any amount that may be payable after the Executive’s death and shall not
preclude the legal representative of the Executive’s estate from assigning any
right hereunder to the person or persons entitled thereto.  If the Executive
should die while any amounts would still be payable to the Executive hereunder,
all such amounts shall be paid in accordance with the terms of this Agreement to
the Executive’s written designee or, if there be no such designee, to the
Executive’s estate.  This Agreement shall be binding upon and shall inure to the
benefit of, and shall be enforceable by, the Executive, the Executive’s heirs
and legal representatives and the Corporation and its successors.  The section
headings shall not be taken into account for purposes of the construction of any
provision of this Agreement.
 
5.11         Meaning of Signing This Agreement.  By signing this Agreement,
Executive expressly acknowledges and agrees that (a) she has carefully read it
and fully understands what it means; (b) she has been advised in writing to
discuss this Agreement with an independent attorney of her own choosing before
signing it and has had a reasonable opportunity to confer with her attorney and
has discussed and reviewed this Agreement with her attorney prior to executing
it and delivering it to the Corporation; (c) she has had answered to her
satisfaction any questions she has with regard to the meaning and significance
of any of the provisions of this Agreement; and (d) she has agreed to this
Agreement knowingly and
 
 
 
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voluntarily of her own free will and was not subjected to any undue influence or
duress, and assents to all the terms and conditions contained herein with the
intent to be bound hereby.
 
5.12         Compliance with Section 409A.
 
(a)           The parties acknowledge and agree that, to the extent applicable,
this Agreement shall be interpreted in accordance with, and the parties agree to
use their best efforts to achieve timely compliance with, Section 409A of the
Code (“Section 409A”).  Notwithstanding any provision of this Agreement to the
contrary, in the event that the Corporation determines that any compensation or
benefits payable or provided hereunder may be subject to Section 409A, the
Corporation reserves the right (without any obligation to do so or to indemnify
the Executive for failure to do so), after consulting with and securing the
approval of the Executive (such approval not to be unreasonably withheld or
delayed), to adopt such limited amendments to this Agreement and appropriate
policies and procedures, including amendments and policies with retroactive
effect, that the Corporation reasonably determines are necessary or appropriate
to (i) exempt the compensation and benefits payable under this Agreement from
Section 409A and/or preserve the intended tax treatment of the compensation and
benefits provided with respect to this Agreement or (ii) comply with the
requirements of Section 409A.
 
(b)           Notwithstanding any provision in this Agreement to the contrary,
no amounts that become payable under this Agreement on account of the
Executive’s termination of employment shall be payable unless the Executive’s
termination of employment constitutes a “separation from service” within the
meaning of Section 1.409A-1(h) of the Department of Treasury Regulations.  If
the Executive is determined to be a “specified employee” for purposes of Section
409A(a)(2)(B)(i) of the Code, then any amount that becomes payable under this
Agreement on account of the Executive’s “separation from service” (the
“Severance Payment”) shall not be paid to the Executive until the first business
day following the expiration of the six (6) month period immediately following
the Executive’s “separation from service” (or if earlier, the date of the
Executive’s death), but rather, all such payments shall be made on the date that
is five business days after the expiration of that six month period, if and to
the extent that the Severance Payment constitutes deferred compensation (or may
be nonqualified deferred compensation, as mutually agreed by the Corporation and
the Executive, such agreement not to be unreasonably withheld or delayed by the
Executive) under Section 409A of the Code and such deferral is required to
comply with the requirements of Section 409A of the Code.  For the avoidance of
doubt, no portion of the Severance Payment shall be delayed for six (6) months
after the Executive’s “separation from service” if such portion (x) constitutes
a “short term deferral” within the meaning of Section 1.409A-1(a)(4) of the
Department of Treasury Regulations, or (y) (A) it is being paid due to the
Corporation’s termination of the Executive’s employment without Cause or the
Executive’s termination of employment for Good Reason; (B) it does not exceed
two times the lesser of (1) the Executive’s annualized compensation from the
Corporation for the calendar year prior to the calendar year in which the
termination of the Executive’s employment occurs, or (2) the maximum amount that
may be taken into account under a qualified plan pursuant to Section 401(a)(17)
of the Code for the year in which the Executive’s employment terminates; and (C)
the payment is required under this Agreement to be paid no later than the last
day of the
 
 
 
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second calendar year following the calendar year in which the Executive incurs a
“separation from service”.  For purposes of Section 409A of the Code, the
Executive’s right to receive installment payments under this Agreement shall be
treated as a right to receive a series of separate and distinct payments.  To
the extent that any reimbursement of any expense under Section 1.4(e) or in-kind
benefits provided under this Agreement are deemed to constitute taxable
compensation to the Executive, such amounts will be reimbursed or provided no
later than December 31 of the year following the year in which the expense was
incurred.  The amount of any such expenses reimbursed or in-kind benefits
provided in one year shall not affect the expenses or in-kind benefits eligible
for reimbursement or payment in any subsequent year, and the Executive’s right
to such reimbursement or payment of any such expenses will not be subject to
liquidation or exchange for any other benefit.  The determination of whether the
Executive is a “specified employee” for purposes of Section 409A as of the time
of the Executive’s separation from service shall made by the Corporation in
accordance with the terms of Section 409A.
 
 
 
 
 
 
 
 
 
 
 
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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date and year first above written.
 
 

RALPH LAUREN CORPORATION                            
/s/ Ralph Lauren
   
/s/ JACKWYN NEMEROV
 
By:  Ralph Lauren
   
JACKWYN NEMEROV
 
Title: Chairman & Chief Executive Officer
   
 
           
Date:  September 18, 2013
   
Date:  September 18, 2013  
 

 
 
 
 
 
 
 
 
 
 
 
 
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SCHEDULE A
 
Abercrombie & Fitch Co.
Ann Taylor Stores Corp.
Brooks Brothers
Burberry Limited
Campagnie Financiere Richemont SA
Chanel S.A.
Coach, Inc.
Crate & Barrel (aka Euromarket Designs, Inc.)
Dillard’s Inc.
Dolce & Gabbana
Fifth & Pacific Companies, Inc.
Gap Inc.
Giorgio Armani Corp.
Hermes International
Hudson’s Bay Company
Hugo Boss AG
J. Crew Group, Inc.
Jones Apparel Group, Inc.
Limited Brands, Inc.
LVMH Moet Hennessy Louis Vuitton S.A.
Macy’s Inc.
Michael Kors, Inc.
Neiman Marcus Group, Inc.
Nordstrom, Inc.
PPR Group
Prada (aka I Pellettieri d’Italia S.P.A.)
PVH Corp.
Saks Inc.
Salvatore Ferragamo Italia S.P.A.
TJX Companies, Inc.
VF Corporation
Williams-Sonoma, Inc.
 
 
 
 
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Exhibit 1
 
Term Sheet
 
 
Jackwyn Nemerov
September 17, 2013

Term:
Commencing November 1, 2013, and ending April 1, 2017, automatic 1 year renewals
with 180 day mutual notice

 
Title:
President and Chief Operating Officer

 
Base Salary:
$1,000,000 annually

 
Annual Bonus:
Continue to participate in Executive Officer Annual Incentive Plan (EOAIP), with
goal based 100% on Corporate performance and EOAIP Strategic Goal achievement.

 

 
Beginning Fiscal 2015, bonus percentages as follows (excluding impact of
Strategic Goal adjustment):

 
Target
 300% of salary
Threshold
 150%
Stretch
  375%
Maximum
 450%

 

 
For Fiscal 2014, annual bonus will be calculated by adding: (1) the full-year
bonus based on salary, targets and goals established in beginning of Fiscal
2014; and (2) an incremental bonus based on Corporation performance for the
period between November 1, 2013 and the end of Fiscal 2014 using targets to be
approved by the Compensation Committee.  Those bonus levels are as follows:

 

 
Full-Year Fiscal 2014 bonus based on original targets and goals:

 
Target
 200% of $900,000 salary
   
Threshold
 100% of $900,000 salary
   
Stretch
 250% of $900,000 salary
 
 
Maximum
 300% of $900,000 salary
   

 

 
Fiscal 2014 incremental bonus:

 
 
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Target
$500,000    
Threshold
$250,000
   
Stretch
$625,000    
Maximum
$750,000
   

 

 
Based on the above, total Fiscal 2014 bonus target will be equal to prorated
bonus based on Fiscal 2014 salary earnings and bonus percentages.

(At all times your bonus opportunity will be governed by the terms of the
Corporation’s EOAIP and nothing contained herein restricts the Corporation’s
rights to alter, amend or terminate the EOAIP at any time.)

Annual Equity
Award:
Beginning Fiscal 2015, $9,000,000 value to be granted annually at the same time
as annual awards to other executives, normally with a portion of the award in
each of April and July but may be earlier or later, and under terms of the
equity program as approved each year by the Compensation Committee, including
grant structure, types of awards, conversion of value to actual number of
shares, and other applicable factors as determined by the Committee in its
discretion.

 
In addition, awards with a target value of $5,550,000 will be granted on or
before the last day of the fiscal quarter in which the Effective Date
occurs.  One-third of award shall be in the form of each of the following: Cliff
Restricted Performance Share Units, Cliff Restricted Performance Share Units
with Total Shareholder Return Modifier, and stock options.  The Cliff awards
will be granted with same performance goals and vesting period as those granted
on April 1, 2013.  The stock options will vest one-third on the first
anniversary of the date of grant and one-third on each of the second and third
anniversaries of the date options were granted to other senior executives in
Fiscal 2014.

 

 
Conversion of annual grant value to be based on the Corporation’s standard
procedure of applying the applicable Fair Market Value 10 days before the grant
date.

 
Stock Ownership
Guideline:
Executive may be subject to an increase in stock ownership levels under the
stock ownership guidelines as directed by the Compensation Committee.

 
 
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Severance:
Base salary for remainder of term up to a maximum of two years, or for one year,
whichever is greater, plus target bonus.

 
Car and Driver:
The Corporation shall reimburse the Executive for the use of a car and driver.

Non-Compete/
Non Solicit:
Non-compete and non-solicit clauses will be consistent in terms of time periods
with former contract, except that the non-compete shall also apply in the event
of a termination without Cause or a resignation for Good Reason.

 
 
 
 
 
 
 
 
 
 
 
 
 
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