Exhibit 10(b)


 


SECOND
AMENDMENT TO THE

PARTICIPATION AGREEMENT UNDER THE

HAGGAR CORP. SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN


 


This Second Amendment (“Second
Amendment”) to the Participation Agreement under the Supplemental Executive
Retirement Plan by and between Haggar Clothing Co., a Nevada corporation, and
Frank D. Bracken (the “Participant”) dated as of October 1, 1999 (the “Participation
Agreement”) is made and entered into by and between Haggar Clothing Co. and the
Participant effective as of January 1, 2005.  Any capitalized term used herein, and not
otherwise defined herein, shall have the meaning set forth in the Participation
Agreement or the Haggar Corp. Supplemental Executive Retirement Plan (the “Plan”).


 


RECITALS


 


A.                                   Haggar Clothing Co.
and the Participant previously entered into the Participation Agreement;


 


B.                                     Haggar Clothing
Co. and the Participant previously amended the Participation Agreement,
effective February 14, 2003 (the “First Amendment”);


 


C.                                     The portion of the
Participant’s benefit under the Plan vesting on and after January 1, 2005
(the “Unvested Benefit”) will be subject to section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”), which section imposes
additional taxes on the Participant unless the Participation Agreement is
amended to comply with section 409A of the Code;


 


D.                                    The Participant’s
Unvested Benefit equals ten percent (10%) of the Participant’s benefit under
the Plan; and


 


E.                                      Haggar Clothing
Co. and the Participant desire to amend the terms of the Participation
Agreement to comply with section 409A of the Code with respect to the
Participant’s Unvested Benefit.


 


AGREEMENT


 


NOW, THEREFORE, in
consideration of the premises and agreements herein contained and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Haggar Clothing Co. and the Participant hereby agree as follows:


 


1.                                       Addition of New Section 10.  A new Section 10 is hereby added,
effective January 1, 2005, to the Participation Agreement to read as follows:


 


10.                                 In
order to comply with the provisions of section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”), this Section 10 will be
effective on and after January 1, 2005 with respect to the 10% of the
Participant’s benefit under the Plan that was not vested on January 1,
2005, notwithstanding anything to the contrary in the Plan or this
Agreement.  This Section 10 shall
have no effect on the 90% of the Participant’s benefit vested as of December 31,
2004


 





















 


and the Plan
as in effect on December 31, 2004 shall continue to govern that portion of
the Participant’s benefit.  Moreover,
that vested portion of the Participant’s benefit shall not be considered in
calculating the Retirement Benefit or Pre-Retirement Death Benefit as such terms
are used below.


 


(a)                                  Change of Control.  Effective January 1, 2005, the
Participant (or the Participant’s surviving spouse) will no longer be entitled
to the lump sum benefit described in Section 4.1(d) of the Plan and
instead upon a Change of Control (as defined below) the Participant (or the
Participant’s surviving spouse) will receive, as soon as administratively
feasible following the Change of Control, a lump sum cash payment with an
actuarial present value of the remaining vested portion of the Retirement
Benefit or Pre-Retirement Death Benefit, as the case may be, reduced by
10%.  The Corporation’s actuaries shall
provide the calculation of such lump sum amount based on the Actuarial
Assumptions (as defined in the Plan).  On
and after January 1, 2005, the Participant (or the Participant’s surviving
spouse) will no longer be entitled to request the acceleration of the
Retirement Benefit or Pre-Retirement Death Benefit into a lump sum payment.


 


Change of Control, with respect to the Participant’s benefit that is
unvested as of January 1, 2005, shall mean (i) a merger or
consolidation of the Corporation or Haggar Clothing Co. with or into another
entity, or the exchange of securities (other than a merger or consolidation) by
the holders of the voting securities of the Corporation or Haggar Clothing Co.
and the holders of voting securities of any other entity, in which the
shareholders of the Corporation or Haggar Clothing Co. immediately before the
transaction do not own 50% or more of the combined voting power of the voting
securities of the surviving entity or its parent immediately after the
transaction; (ii) a dissolution of the Corporation or Haggar Clothing Co.;
(iii) a transfer of all or substantially all of the assets of the
Corporation, or Haggar Clothing Co., in one transaction or a series of
transactions occurring within a twelve month period to a “Person” or “Group”
(as defined below); (iv) a transaction or a series of transactions in
which a Person or Group becomes the beneficial owner, directly or indirectly,
of securities of the Corporation, or Haggar Clothing Co., representing more
than 50% of the combined voting power of the Corporation’s or Haggar Clothing
Co.’s then outstanding securities; or (v) a majority of the members of the
Corporation’s Board is replaced during any twelve month period by directors
whose appointment or election is not endorsed by a majority of the Corporation’s
Board prior to the date of the appointment or election; provided, however, that
a “Change of Control” shall not be deemed to have occurred if the ownership of
50% or more of the combined voting power of the surviving corporation, asset
transferee, Corporation or Haggar Clothing Co. (as the case may be), after
giving effect to the transaction or series of transactions, is directly or
indirectly held by (A) a trustee or other fiduciary under an employee
benefit plan


 


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maintained by
the Corporation, Haggar Clothing Co., or any Subsidiary, (B) one or more
of the “executive officers” of the Corporation that held such positions prior
to the transaction or series of transactions, or any entity, Person or Group
under their control, (C) one or more of the children of J.M. Haggar, Sr.
or their lineal descendants, or any entity, Person or Group under their
control, or (D) one or more members of the “senior management” of the
Corporation or Haggar Clothing Co. as designated by the Chief Executive Officer
from time to time, that held such positions prior to the transaction or series
of transactions, or any entity, Person or Group under their control.  As used herein, “Person” and “Group” shall
have the meanings set forth in Sections 13(d)(3) and/or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (“1934 Act”), and “executive
officer” shall have the meaning set forth in Rule 3b-7 promulgated
under the 1934 Act.  “Group” shall
further be determined by the Plan Administrator to constitute “more than one
person acting as a group” for purposes of section 409A of the Code and the
guidance promulgated thereunder (the “Deferred Compensation Rules”).  The definition of Change of Control above
shall be controlling with respect to the portion of  the Participant’s benefit that is unvested as
of January 1, 2005 for all purposes under the Plan and the Trust under the
Haggar Corp. Supplemental Executive Retirement Plan (the “Trust”).


 


(b)                                 Retirement Benefit.  The Participant’s vested Retirement Benefit
that would otherwise be payable pursuant to Section 4.1(a) of the
Plan shall not commence until the lapse of six months from the Participant’s
termination of employment with Haggar Clothing Co. on which date the delayed
annuity payments will be paid in full and future annuity payments will be paid
in accordance with their schedule.  The
Participant will not be entitled to any additional compensation for the time
value of money with respect to this six month delay.


 


(c)                                  Trust Funding.  Notwithstanding any provision of the Trust to
the contrary (including Section 1(f) of the Trust) the Corporation
shall have no obligation to make any payments to the Trust with respect to
amounts payable pursuant to Section 10(a) above to the Participant
upon a Change of Control as defined above.


 


(d)                                 Section 409A of the Code.  This Section 10 is intended to bring
distributions made with respect to the Participant’s benefit under the Plan
that was not vested on January 1, 2005 into compliance with the Deferred
Compensation Rules and the definition of Change of Control above is
intended to constitute “a change in the ownership or effective control of the
corporation, or in the ownership of a substantial portion of the assets of the
corporation” as such terms are used in the Deferred Compensation Rules.  Accordingly, this Section 10 and the
definition of Change of Control herein shall be interpreted by the Plan
Administrator, in its sole discretion exercised in good faith, in such a manner
that


 


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distributions made under the Plan will comply
with the requirements of the Deferred Compensation Rules.


 


2.                                       Effect. 
Except as provided by this Second Amendment and the First Amendment, all
of the provisions of the Participation Agreement are hereby affirmed, ratified
and declared to be in full force and effect.


 


3.                                       Counterparts.  This Second Amendment may be executed in
multiple counterparts, each of which shall be deemed an original and together
shall constitute one and the same Second Amendment.


 


4.                                       Governing Law.  This Second Amendment shall be governed by
and construed in accordance with the laws of the State of Texas without
application of the conflict of laws principles thereof, except to the extent
preempted by federal law, which shall govern to such extent.


 


[Signature Page Follows]


 


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IN
WITNESS WHEREOF, the parties hereto have executed this Second
Amendment as of March 15, 2005.


 


	
   

  	
  HAGGAR CLOTHING CO.,
  a Nevada

  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John W. Feray

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  John W. Feray

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Accounting Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARTICIPANT

  
	
   

  	
   

  
	
   

  	
  /s/ Frank D. Bracken

  	
   

  
	
   

  	
  Frank D. Bracken

  
						



 


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