Exhibit 10.1

 

THE TIMBERLAND COMPANY
2005 LONG TERM INCENTIVE PROGRAM
FOR KENNETH P. PUCKER

 

(effective 1/1/05)

 

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THE TIMBERLAND COMPANY

2005 LONG TERM INCENTIVE PROGRAM

FOR KENNETH P. PUCKER

 

This instrument sets forth the terms of The Timberland Company 2005 Long Term
Incentive Program for Kenneth P. Pucker.  The Program is established under The
Timberland Company 1997 Incentive Plan, and amounts paid under the Program are
intended to qualify as performance-based compensation under Section 162(m) of
the Internal Revenue Code.

 

1.                                      Purpose.  The purpose of the Program is
to provide competitive incentive pay and capital accumulation opportunities to
the Company’s Executive Vice President and Chief Operating Officer under the
terms and conditions set forth in the Program instrument.  The purpose of this
Award is to provide such officer with a cash bonus Award in exchange for his
attainment of a specified Performance Goal, continued employment through
March 31, 2007, and agreement not to compete for a one-year period following his
termination of employment.  The Award is for a one-year Award Period, and the
amount of such Award (set forth in Schedule A) equals the amount by which the
cash bonus award the Committee intended to provide the officer at its meeting on
March 2, 2004, for a three-year award period, was reduced by operation of the
maximum limit set forth in the Plan on cash bonus awards with performance
periods longer than one year.

 

2.                                       Definitions.  The following terms shall
have the following meanings unless the context indicates otherwise.

 

(a)                                     “Affiliate” shall mean any corporation
or other entity owning, directly or indirectly, 50% or more of the outstanding
Stock of the Company, or in which the Company or any such corporation or other
entity owns, directly or indirectly, 50% or more of the outstanding capital
stock (determined by aggregate voting rights) or other voting interests.

 

(b)                                    “Award” shall mean an opportunity to earn
incentive pay, in the form of a cash bonus based on performance, as described in
Section 5.

 

(c)                                     “Award Period” shall mean the one-year
period commencing January 1, 2005, and shall be the measurement period during
which Goal attainment is determined.

 

(d)                                    “Board” shall mean the Board of Directors
of The Timberland Company.

 

(e)                                     “Code” shall mean the Internal Revenue
Code of 1986, as from time to time amended.

 

(f)                                       “Committee” shall mean the Management
Development and Compensation Committee of the Board.

 

(g)                                    “Company” shall mean The Timberland
Company.

 

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(h)                                    “Participant” shall mean Kenneth P.
Pucker.

 

(i)                                        “Performance Goal” or “Goal” shall
mean the financial objective that must be met to earn incentive pay.

 

(j)                                        “Performance Measure” shall mean
compound annual growth in earnings per share (“EPS”).

 

(k)                                     “Plan” shall mean The Timberland Company
1997 Incentive Plan, as amended.

 

(l)                                        “Program” shall mean The Timberland
Company 2005 Long Term Incentive Program for Kenneth P. Pucker.

 

(m)                                  “Stock” shall mean Class A Common Stock of
the Company, par value $.01 per share.

 

3.                                      Administration.  The Program shall be
administered by the Committee, in accordance with the terms of the Plan.  The
Committee shall have sole and complete discretion with respect to the exercise
of all permissive powers and authority granted to the administrator under the
Plan; provided, however, the Committee may not exercise its discretion to
increase the amount of incentive pay that would be otherwise due the Participant
upon attainment of the Performance Goal.  All actions, determinations, and
decisions of the Committee shall be final, conclusive, and binding on all
parties.

 

4.                                      Participation.  The Participant was
designated by the Committee at its meeting on December 1, 2004, to participate
during a one-year Award Period.

 

5.                                      Award.  The Award was established by the
Committee at its meeting on March 2, 2005, and was expressed as an opportunity
to receive a cash bonus.  The Award is based on the attainment of a specific
Performance Goal described in Section 6.  The Award shall not be changed or
modified during the Award Period to increase the amount of incentive pay that
would otherwise become payable.  (Schedule A attached shows the Award and Award
Period.)

 

6.                                      Performance Measure and
Goal.                The Performance Measure and Goal were established by the
Committee at its meeting on March 2, 2005.  The Performance Goal shall not be
changed or modified during the Award Period to increase the amount of incentive
pay that would otherwise become payable.  (Schedule B attached sets forth the
Performance Measure and Goal for the Award Period.)

 

7.                                      Award Payout Calculation.

 

(a)                                   Award payout shall be conditioned on
attainment of the Performance Goal.  No payout shall be made unless the Goal is
attained, and the payout shall not be increased to the extent the Goal is
surpassed.

 

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(b)                                    The Company’s independent public
accountants shall audit the Company’s Award calculations following the close of
the Award Period.

 

(c)                                     The Committee shall promptly approve or
disapprove the Award payout following completion of the independent audit.  The
Committee may exercise “negative discretion” within the meaning of Code
Section 162(m) to reduce the cash bonus Award payout unless the fair market
value of the Stock on December 31, 2006, is less than $        per share.  The
Committee may reduce the Award payout to reflect extraordinary circumstances if
such modification would better serve the purpose of the Plan.

 

8.                                      Award Payment.

 

(a)                                     The Award payout shall be made in 2007
and not later than March 31 of such year, subject to the independent audit.  To
be eligible to receive a payout, the Participant must be employed by the Company
or an Affiliate on the payment date.

 

(b)                                    The Award payout shall be made in cash.

 

9.                                        Employment

 

Receiving this Award or Award payout shall not give the Participant the right to
be retained in the employment of the Company or an Affiliate, or affect the
right of the Company or an Affiliate to discharge or discipline the Participant.

 

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THE TIMBERLAND COMPANY

2005 LONG TERM INCENTIVE PROGRAM

FOR KENNETH P. PUCKER

 

Schedule A - Award

 

One-Year Award Period (1/1/05-12/31/05)

 

TBL FMV in

 

 

 

 

 

 

 

 

 

Payment Year

 

 

2007

 

Cash Bonus

 

$

1.25MM

 

 

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THE TIMBERLAND COMPANY

2005 LONG TERM INCENTIVE PROGRAM

FOR KENNETH P. PUCKER

 

Schedule B - Performance Measures and Goals

 

Award Period

 

Performance
Measure

 

Wtg

 

Financial Target (Goal)

 

1/1/05 - 12/31/05

 

EPS

 

100

%

$

     

 

 

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