PHILLIPS-VAN HEUSEN CORPORATION


EXHIBIT 10.10

PHILLIPS-VAN HEUSEN CORPORATION

1997 STOCK OPTION PLAN

(As Amended Through March 7, 2001)



 

1.Purpose.  The purposes of the 1997 Stock Option Plan (the
"Plan") are to induce certain individuals to remain in the employ, or to
continue to serve as directors, of Phillips-Van Heusen Corporation (the
"Company") and its present and future subsidiary corporations (each a
"Subsidiary"), as defined in Section 424(f) of the Internal Revenue Code of
1986, as amended (the "Code"), to attract new individuals to enter into such
employment or service and to encourage such individuals to secure or increase on
reasonable terms their stock ownership in the Company.  The Board of
Directors of the Company (the "Board") believes that the granting of stock
options (the "Options") under the Plan will promote continuity of management
and increased incentive and personal interest in the welfare of the Company by
those who are or may become primarily responsible for shaping and
carrying out the long range plans of the Company and securing its continued
growth and financial success.  Options granted hereunder are intended to be
either (a) "incentive stock options" (which term, when used herein, shall have
the meaning ascribed thereto by the provisions of Section 422(b) of the
Code) or (b) options which are not incentive stock options ("non-incentive stock
options") or (c) a combination thereof, as determined by the Committee
(the "Committee") referred to in Section 5 at the time of the grant thereof.


2.Effective Date of the Plan.  The Plan became effective on
April 29, 1997.


3.Stock Subject to Plan.  2,500,000 of the authorized but
unissued shares of the common stock, $1.00 par value, of the Company (the
"Common Stock") are hereby reserved for issue upon the exercise of Options
granted under the Plan; provided, however, that the number of
shares so reserved may from time to time be reduced to the extent that a
corresponding number of issued and outstanding shares of the Common Stock are
purchased by the Company and set aside for issue upon the exercise of Options.
If any Options expire or terminate for any reason without having been
exercised in full, the unpurchased shares subject thereto shall again be
available for the purposes of the Plan.


4.Administration.

A.Except as otherwise provided in paragraph B of Section 4, the Plan
shall be administered by the Committee.  Subject to the express provisions
of the Plan, the Committee shall have complete authority, in its discretion, to
interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to it, to determine the terms and provisions of the
respective option agreements or certificates (which need not be identical), to
determine the individuals (each a "Participant") to whom and the times and the
prices at which Options shall be granted, the periods during which each
Option shall be exercisable, the number of shares of the Common Stock to be
subject to each Option and whether such Option shall be an incentive stock
option or a non-incentive stock option and to make all other determinations
necessary or advisable for the administration of the Plan.  In making such
determinations, the Committee may take into account the nature of the services
rendered by the respective individuals, their present and potential
contributions to the success of the Company and the Subsidiaries and such other
factors as the Committee in its discretion shall deem relevant.  The
Committee's determination 

1

 

on the matters referred to in this Section 4 shall be conclusive.  Any
dispute or disagreement which may arise under or as a result of or with
respect to any Option shall be determined by the Committee, in its sole
discretion, and any interpretations by the Committee of the terms of any Option
shall be final, binding and conclusive.

B.The Chairman of the Board or, if the Chairman is not an executive
officer of the Company, the Chief Executive Officer of the Company or other
executive officer of the Company designated by the Committee who is also a
director (the Chairman, Chief Executive Officer or other designated executive
officer being referred to as the "Designated Director") may administer the Plan
with respect to employees of the Company or a Subsidiary (i) who are not
officers of the Company subject to the provisions of Section 16 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and
(ii) whose compensation is not subject to the provisions of Section 162(m)
of the Code.  The authority of the Designated Director and Options
granted by the Designated Director shall be subject to such terms, conditions,
restrictions and limitations as may be imposed by the Board, including,
but not limited to, a limit on the aggregate number of shares of Common Stock
subject to Options that may be granted in any one calendar year by the
Designated Director to all such employees of the Company and its Subsidiaries
and a maximum number of shares that may be subject to Options granted
under the Plan in any one calendar year to any single employee by the Designated
Director.  Unless and until the Board shall take further action, the
maximum number of shares of Common Stock that may be subject to Options granted
under the Plan, the Company's 2000 Stock Option Plan and any other stock
option plan then in effect in any one calendar year by the Designated Director
shall be 100,000 in the aggregate and the maximum number of shares of
Common Stock that may be subject to Options granted under the Plan, the
Company's 2000 Stock Option Plan and any other stock option plan then in effect
in any one calendar year by the Designated Director to any single employee shall
be 5,000 in the aggregate.  Any actions duly taken by the Designated
Director with respect to the grant of Options to such employees shall be deemed
to have been taken by the Committee for purposes of the Plan.

5.Committee.  The Committee shall consist of two or more members
of the Board.  It is intended that all of the members of the Committee
shall be "non-employee directors" within the meaning of Rule 16b-3(b)(3)
promulgated under the Exchange Act, and "outside directors" within the
contemplation of Section 162(m)(4)(C)(i) of the Code.  The Committee shall be
appointed annually by the Board, which may at any time and from time to
time remove any members of the Committee, with or without cause, appoint
additional members to the Committee and fill vacancies, however caused, in the
Committee.  A majority of the members of the Committee shall constitute a
quorum.  All determinations of the Committee shall be made by a majority of
its members present at a meeting duly called and held, except that the Committee
may delegate to any one of its members the authority of the Committee
with respect to the grant of Options to any person who shall not be an officer
and/or director of the Company and who is not, and in the judgment of the
Committee may not be reasonably expected to become, a "covered employee" within
the meaning of Section 162(m)(3) of the Code.  Any decision or
determination of the Committee reduced to writing and signed by all of the
members of the Committee (or by the member(s) of the Committee to whom
authority has been delegated) shall be fully as effective as if it had been made
at a meeting duly called and held.

2


 

6.Eligibility.  An Option may be granted only to a key
employee of the Company or a Subsidiary or to a director of the Company or a
Subsidiary who is not an employee of the Company or a Subsidiary.


7.Option Prices.


A.The initial per share option price of any Option shall be the price
determined by the Committee, but not less than the fair market value of a
share of the Common Stock on the date of grant; provided, however,
that, in the case of a Participant who owns more than 10% of the total
combined voting power of the Common Stock at the time an Option which is an
incentive stock option is granted to him or her, the initial per share
option price shall not be less than 110% of the fair market value of a share of
the Common Stock on the date of grant.


B.For all purposes of the Plan, the fair market value of a share of the
Common Stock on any date shall be equal to (i) the closing sale price of
the Common Stock on the New York Stock Exchange on the business day preceding
such date or (ii) if there is no sale of the Common Stock on such Exchange
on such business day, the average of the bid and asked prices on such Exchange
at the close of the market on such business day.


8.Option Term.  Participants shall be granted Options for such
term as the Committee shall determine, not in excess of ten years from
the date of the granting thereof; provided, however, that, in the
case of a Participant who owns more than 10% of the total combined
voting power of the Common Stock at the time an Option which is an incentive
stock option is granted to him or her, the term with respect to such Option
shall not be in excess of five years from the date of the granting thereof.

9.Limitations on Amount of Options Granted.




A.The aggregate fair market value of the shares of the Common Stock for
which any Participant may be granted incentive stock options which are
exercisable for the first time in any calendar year (whether under the terms of
the Plan or any other stock option plan of the Company) shall not exceed
$100,000.


B.No Participant shall, during any fiscal year of the Company, be granted
Options under the Plan to purchase more than 100,000 shares of the
Common Stock.

10.Exercise of Options.




A.Except as otherwise determined by the Committee at the time of grant, a
Participant may not exercise an Option during the period commencing on
the date of the granting of such Option to him or her and ending on the day next
preceding the third anniversary of such date.  Except as otherwise
determined by the Committee at the time of grant, a Participant may (i) during
the period commencing on the third anniversary of the date of the
granting of an Option to him or her and ending on the day next preceding the
fourth anniversary of such date, exercise such Option with respect to one-
third of the shares granted thereby, (ii) during the period commencing on such
fourth anniversary and ending on the day next preceding the fifth
anniversary of the date of the granting of such Option, exercise such Option
with respect to 


3


two-thirds of the shares granted thereby, and (iii) during the period
commencing on such fifth anniversary, exercise such Option with respect to all
of the shares granted thereby.


B.Except as hereinbefore otherwise set forth, an Option may be exercised
either in whole at any time or in part from time to time.


C.An Option may be exercised only by a written notice of intent to
exercise such Option with respect to a specific number of shares of the Common
Stock and payment to the Company of the amount of the option price for the
number of shares of the Common Stock so specified; provided,
however, that, if the Committee shall in its sole discretion so determine
at the time of the grant of any Option, all or any portion of such
payment may be made in kind by the delivery of shares of the Common Stock having
a fair market value equal to the portion of the option price so paid;
provided, further, however, that no portion of such payment
may be made by delivering shares of the Common Stock acquired upon the
exercise of an Option if such shares shall not have been held by the Participant
for at least six months; provided, further,
however, that, subject to the requirements of Regulation T (as in effect
from time to time) promulgated under the Exchange Act, the Committee may
implement procedures to allow a broker chosen by a Participant to make payment
of all or any portion of the option price payable upon the exercise of an
Option and receive, on behalf of such Participant, all or any portion of the
shares of the Common Stock issuable upon such exercise.


D.The Board may, in its discretion, permit any Option to be exercised, in
whole or in part, prior to the time when it would otherwise be
exercisable.


E.I.Notwithstanding the provisions of paragraph A of this Section 10,
in the event that a Change in Control shall occur, then, each Option
theretofore granted to any Participant which shall not have theretofore expired
or otherwise been cancelled or become unexercisable shall become
immediately exercisable in full.  For the purposes of this paragraph E, a
"Change in Control" shall be deemed to occur upon (a) the election of one
or more individuals to the Board which election results in one-third of the
directors of the Company consisting of individuals who have not been
directors of the Company for at least two years, unless such individuals have
been elected as directors or nominated for election by the stockholders as
directors by at least three-fourths of the directors of the Company who have
been directors of the Company for at least two years, (b) the sale by the
Company of all or substantially all of its assets to any Person, the
consolidation of the Company with any Person, the merger of the Company with any
Person as a result of which merger the Company is not the surviving entity as a
publicly held corporation, (c) the sale or transfer of shares of the
Company by the Company and/or any one or more of its stockholders, in one or
more transactions, related or unrelated, to one or more Persons under
circumstances whereby any Person and its Affiliates shall own, after such sales
and transfers, at least one-fourth, but less than one-half, of the
shares of the Company having voting power for the election of directors, unless
such sale or transfer has been approved in advance by at least three-
fourths of the directors of the Company who have been directors of the Company
for at least two years, or (d) the sale or transfer of shares of the
Company by the Company and/or any one or more of its stockholders, in one or
more transactions, related or unrelated, to one or more Persons under
circumstances whereby any Person and its Affiliates shall own, after such sales
and transfers, at least one-half of the shares of the Company having
voting power for the election of directors.  For the purposes of this division
I, (1) the term "Affiliate" shall mean any Person that directly, or
indirectly through one 

4


or more intermediaries, controls, or is controlled by, or is under common
control with, any other Person, (2) the term "Person" shall mean any
individual, partnership, firm, trust, corporation or other similar entity and
(3) when two or more Persons act as a partnership, limited partnership,
syndicate or other group for the purpose of acquiring, holding or disposing of
securities of the Company, such partnership, limited partnership,
syndicate or group shall be deemed a "Person".


II.In the event that a Change of Control shall occur, then, from and
after the time of such event, neither the provisions of this paragraph E
nor any of the rights of any Participant thereunder shall be modified or amended
in any way.


F.Notwithstanding any other provision of the Plan to the contrary,
including, but not limited to, the provisions of paragraph D of Section 10, if
any Participant shall have effected a Hardship Withdrawal from a 401(k) Plan
maintained by the Company and/or one or more of the Subsidiaries, then,
during the period of one year commencing on the date of such Hardship
Withdrawal, such Participant may not exercise any Option using cash.  For the
purpose of this paragraph F, a "Hardship Withdrawal" shall mean a distribution
to a Participant provided for in Reg. § 1.401(k)-1(d)(1)(ii)
promulgated under Section 401(k)(2)(B)(i)(IV) of the Code or an analogous
provision of the Puerto Rico Internal Revenue Code of 1994, as amended (the
"Puerto Rico Code") and the regulations promulgated thereunder, and a "401(k)
Plan" shall mean a plan which is a "qualified plan" within the
contemplation of Section 401(a) of the Code or an analogous provision of the
Puerto Rico Code which contains a "qualified cash or deferred arrangement"
within the contemplation of Section 401(k)(2) of the Code or an analogous
provision of the Puerto Rico Code.


11.Transferability.  No Option shall be assignable or
transferable except by will and/or by the laws of descent and distribution and,
during the life of any Participant, each Option granted to him or her may be
exercised only by him or her.


12.Termination of Employment or Service.  In the event a
Participant leaves the employ, or ceases to serve as a director, of the
Company and the Subsidiaries, whether voluntarily or otherwise but other than by
reason of his or her death or retirement, each Option theretofore
granted to him or her which shall not have theretofore expired or otherwise been
cancelled shall, to the extent exercisable on the date of such
termination of employment or service and not theretofore exercised, terminate
upon the earlier to occur of the expiration of 30 days after the date of
such Participant's termination of employment or cessation of service and the
date of termination specified in such Option.  Notwithstanding the
foregoing, if a Participant is terminated for cause (as defined herein), each
Option theretofore granted to him or her which shall not have theretofore
expired or otherwise been cancelled shall, to the extent not theretofore
exercised, terminate forthwith.  In the event a Participant leaves the employ,
or ceases to serve as a director, of the Company and the Subsidiaries by reason
of his or her retirement, each Option theretofore granted to him or her
which shall not have theretofore expired or otherwise been cancelled shall
become immediately exercisable in full and shall, to the extent not
theretofore exercised, terminate upon the earlier to occur of the expiration of
three years after the date of such retirement and the date of
termination specified in such Option.  In the event a Participant's employment,
or service as a director, with the Company and the Subsidiaries
terminates by reason of his or her death, each Option theretofore granted to him
or her which shall not have theretofore expired or otherwise been
cancelled shall become immediately exercisable in full and shall, to the extent
not theretofore exercised, terminate upon the earlier to occur of the
expiration 


5


of three months after the date of the qualification of a representative of
his or her estate and the date of termination specified in such Option.
For purposes of the foregoing, (a) the term "cause" shall mean:  (i) the
commission by the Participant of any act or omission that would constitute
a crime under federal, state or equivalent foreign law, (ii) the commission by
the Participant of any act of moral turpitude, (iii) fraud, dishonesty or
other acts or omissions that result in a breach of any fiduciary or other
material duty to the Company and/or the Subsidiaries, or (iv) continued
alcohol or other substance abuse that renders the Participant incapable of
performing his or her material duties to the satisfaction of the Company
and/or the Subsidiaries and (b) the term "retirement" shall mean (i) the
termination of a Participant's employment with the Company and all of the
Subsidiaries (A) other than for cause or by reason of his or her death and
(B) on or after the earlier to occur of (I) the first day of the
calendar month in which his or her 65th birthday shall occur and (II) the
date on which he or she shall have both attained his or her 55th birthday
and completed 10 years of employment with the Company and/or the Subsidiaries or
(ii) the termination of a Participant's service as a director with the
Company and all of the Subsidiaries (A) other than for cause or by reason of his
or her death and (B) on or after the first day of the calendar month in
which his or her 65th birthday shall occur.


13.Adjustment of Number of Shares.  In the event that a
dividend shall be declared upon the Common Stock payable in shares of the
Common Stock, the number of shares of the Common Stock then subject to any
Option and the number of shares of the Common Stock reserved for issuance in
accordance with the provisions of the Plan but not yet covered by an Option and
the number of shares set forth in paragraph B of Section 9 shall be
adjusted by adding to each share the number of shares which would be
distributable thereon if such shares had been outstanding on the date fixed for
determining the stockholders entitled to receive such stock dividend.  In the
event that the outstanding shares of the Common Stock shall be changed
into or exchanged for a different number or kind of shares of stock or other
securities of the Company or of another corporation, whether through
reorganization, recapitalization, stock

split-up, combination of shares, sale of assets, merger or consolidation in
which the Company is the surviving corporation, then, there shall be
substituted for each share of the Common Stock then subject to any Option and
for each share of the Common Stock reserved for issuance in accordance
with the provisions of the Plan but not yet covered by an Option and for each
share of the Common Stock referred to in paragraph B of Section 9, the
number and kind of shares of stock or other securities into which each
outstanding share of the Common Stock shall be so changed or for which each such
share shall be exchanged.  In the event that there shall be any change, other
than as specified in this Section 13, in the number or kind of outstanding
shares of the Common Stock, or of any stock or other securities into which the
Common Stock shall have been changed, or for which it shall have been
exchanged, then, if the Committee shall, in its sole discretion, determine that
such change equitably requires an adjustment in the number or kind of
shares then subject to any Option and the number or kind of shares reserved for
issuance in accordance with the provisions of the Plan but not yet
covered by an Option and the number or kind of shares referred to in paragraph B
of Section 9, such adjustment shall be made by the Committee and shall
be effective and binding for all purposes of the Plan and of each stock option
agreement or certificate entered into in accordance with the provisions
of the Plan.  In the case of any substitution or adjustment in accordance with
the provisions of this Section 13, the option price in each stock option
agreement or certificate for each share covered thereby prior to such
substitution or adjustment shall be the option price for all shares of stock or
other securities which shall have been substituted for such share or to which
such share shall have been adjusted in accordance with the provisions of
this Section 13.  No adjustment or substitution provided for 

6


in this Section 13 shall require the Company to sell a fractional share under
any stock option agreement or certificate.  In the event of the
dissolution or liquidation of the Company, or a merger, reorganization or
consolidation in which the Company is not the surviving corporation, then,
except as otherwise provided in the second sentence of this Section 13,
each Option, to the extent not theretofore exercised, shall terminate
forthwith.


14.Purchase for Investment, Withholding and Waivers.  Unless
the shares to be issued upon the exercise of an Option by a Participant
shall be registered prior to the issuance thereof under the Securities Act of
1933, as amended, such Participant will, as a condition of the Company's
obligation to issue such shares, be required to give a representation in writing
that he or she is acquiring such shares for his or her own account as
an investment and not with a view to, or for sale in connection with, the
distribution of any thereof.  In the event of the death of a Participant, a
condition of exercising any Option shall be the delivery to the Company of such
tax waivers and other documents as the Committee shall determine.  In
the case of each 

non-incentive stock option, a condition of exercising the same shall be the
entry by the person exercising the same into such arrangements with the
Company with respect to withholding as the Committee may determine.


15.No Stockholder Status.  Neither any Participant nor his or
her legal representatives, legatees or distributees shall be or be
deemed to be the holder of any share of the Common Stock covered by an Option
unless and until a certificate for such share has been issued.  Upon
payment of the purchase price thereof, a share issued upon exercise of an Option
shall be fully paid and non-assessable.


16.No Restrictions on Corporate Acts.  Neither the existence
of the Plan nor any Option shall in any way affect the right or power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's
capital structure or its business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior preference stock
ahead of or affecting the Common Stock or the rights thereof, or dissolution or
liquidation of the Company, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding whether of a
similar character or otherwise.


17.No Employment Right.  Neither the existence of the Plan nor
the grant of any Option shall require the Company or any Subsidiary to
continue any Participant in the employ of the Company or such Subsidiary.


18.Termination and Amendment of the Plan.  The Board may at
any time terminate the Plan or make such modifications of the Plan as it
shall deem advisable; provided, however, that the Board may not
without further approval of the holders of a majority of the shares of the
Common Stock present in person or by proxy at any special or annual meeting of
the stockholders, increase the number of shares as to which Options may
be granted under the Plan (as adjusted in accordance with the provisions of
Section 13), or change the class of persons eligible to participate in the
Plan, or change the manner of determining the option prices.  Except as
otherwise provided in Section 13, no termination or amendment of the Plan may,
without the consent of the Participant to whom any Option shall theretofore have
been granted, adversely affect the rights of such Participant under
such Option.  The Committee may not, without further approval of the holders of
a majority of the shares of the Common Stock present in person or by


7


proxy at any special or annual meeting of the stockholders, amend any
outstanding Option to reduce the option price, or cancel any outstanding Option
and contemporaneously award a new Option to the same optionee for substantially
the same number of shares at a lower option price.


19.Expiration and Termination of the Plan.  The Plan shall
terminate on April 28, 2007 or at such earlier time as the Board may
determine.  Options may be granted under the Plan at any time and from time to
time prior to its termination.  Any Option outstanding under the Plan at
the time of the termination of the Plan shall remain in effect until such Option
shall have been exercised or shall have expired in accordance with its
terms.


20.Options for Outside Directors.


A.A director of the Company who is not an employee of the Company or a
Subsidiary (an "Outside Director") shall be eligible to receive, in
addition to any other Option which he or she may receive pursuant to Section 6,
an annual Option.  Except as otherwise provided in this Section 20, each
such Option shall be subject to all of the terms and conditions of the Plan.


B.I.At the first meeting of the Board immediately following each
Annual Meeting of the Stockholders of the Company, each Outside Director
shall be granted an Option, which shall be a non-incentive stock option, to
purchase 8,000 shares of the Common Stock.  Notwithstanding the foregoing,
an Outside Director may not receive a grant under this Section 20 for any year
if and to the extent such Outside Director receives a grant of options to
purchase Common Stock under any other Company stock option plan then in effect
solely for his or her services as a director of the Company for such year
and the aggregate number of shares of Common Stock issuable upon the exercise of
all such options granted for such year would exceed 8,000.


II.The initial per share option price of each Option granted to an
Outside Director shall under this Section 20 be equal to the fair market
value of a share of the Common Stock on the date of grant.


III.The term of each Option granted to an Outside Director shall be
ten years from the date of the granting thereof.


IV.All or any portion of the payment required upon the exercise of an
Option granted to an Outside Director may be made in kind by the
delivery of shares of the Common Stock having a fair market value equal to the
portion of the option price so paid.


C.The provisions of this Section 20 may not be amended except by the vote
of a majority of the members of the Board and by the vote of a majority
of the members of the Board who are not Outside Directors.


 

 

 

 

 

 

 

8