Document:

EX-10.14

 

EXECUTION COPY

Exhibit 10.14

POLO RALPH LAUREN CORPORATION

NONQUALIFIED STOCK OPTION AGREEMENT

     THIS AGREEMENT (the “Agreement”), is made effective as of the 8th day of June, 2004, (the
“Date of Grant”), between Polo Ralph Lauren Corporation, a Delaware corporation (the “Company”),
and Mr. Ralph Lauren (the “Participant”):

R E C I T A L S:

          WHEREAS, the Company has adopted the Polo Ralph Lauren Corporation 1997 Long-Term Stock
Incentive Plan, as amended from time to time (the “Plan”), which Plan is incorporated herein by
reference and made a part of this Agreement. Capitalized terms not otherwise defined herein shall
have the same meanings as in the Plan; and

          WHEREAS, the Company and the Participant have entered into an Amended and Restated Employment
Agreement dated June 23, 2003 (such agreement, as amended from time to time, the “Employment
Agreement”), which contemplates that the Committee will grant the Option (as hereinafter defined)
to the Participant; and

          WHEREAS, the Committee has determined that it would be in the best interests of the Company
and its stockholders to grant the option provided for herein (the “Option”) to the Participant
pursuant to the Plan and the terms set forth herein.

          NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties
hereto agree as follows:

     1. Grant of the Option. The Company hereby grants to the Participant the right and option
to purchase, on the terms and conditions hereinafter set forth, all or any part of an aggregate of
150,000 shares of Class A Common Stock of the Company (the “Shares”)(the “Option”), subject to
adjustment as set forth in the Plan. The purchase price of the Shares subject to the Option shall
be $33.12 per Share (the “Exercise Price”), which amount is equal to the Fair Market Value on the
Date of Grant. The Option is intended to be a non-qualified stock option, and is not intended to
be treated as an option that complies with Section 422 of the Internal Revenue Code of 1986, as
amended (the “Code”).

     2. Vesting and Exercisability.

          (a) Subject to the Participant’s continued employment with the Company, the Option shall vest
and become exercisable with respect to one third (1/3) of the Shares initially covered by the
Option on each of the first, second and third anniversaries of the Date of Grant

 

 

(each, an “Option Vesting Date”). At any given time, the portion of the Option that has become
vested and exercisable as described above (or pursuant to Sections 2(c) below) is hereinafter
referred to as the “Vested Portion.”

          (b) If the Company shall terminate the Participant’s employment with the Company without Cause
(as defined below), if the Company elects not to extend the Term (as defined below) or if the
Participant terminates his employment with the Company for Good Reason (as defined below), then any
unvested portion of the Option on the last day of the Participant’s employment with the Company
(the “Termination Date”) shall continue to vest in accordance with the vesting schedule set forth
in Section 2(a) hereof, subject to Participant’s continued compliance with Section 8 of the
Employment Agreement (relating to non-solicitation and non-competition). In addition, any Vested
Portion (and any other portion that vests as described above in this Section 2(b)) will remain
exercisable until the later to occur of (i) one (1) year from the Termination Date or (ii) thirty
(30) days from the date such portion of the Option becomes vested and exercisable, but in no event
later than the Expiration Date (as defined below) of the Option.

          (c) If the Participant’s employment is terminated due to his death or Disability (as defined
below), then any unvested portion of the Option held by the Participant on the Termination Date
will vest immediately and remain exercisable for three (3) years from the Termination Date, but in
no event later than the Expiration Date (as defined below) of the Option.

          (d) If the Participant’s employment with the Company is terminated by the Company for Cause,
by the Participant other than for Good Reason, or if the Participant elects not to extend the Term,
then any portion of the Option that has not been exercised as of the Termination Date shall be
forfeited.

          (e) Notwithstanding any other provision of this Agreement to the contrary, in the event of a
Change of Control (as defined in the Plan) the Option shall, to the extent not then vested and not
previously canceled, immediately become fully vested and exercisable as contemplated by Section 13
of the Plan.

          (f) For purposes of this Agreement, the terms “Cause,” “Term,” “Good Reason,” and “Disability”
shall have the respective meanings specified in the Employment Agreement.

     3. Exercise of Option.

          (a) Period of Exercise. Subject to the provisions of the Plan and this Agreement, the
Participant may exercise all or any part of the Vested Portion of the Option at any time prior to
the tenth anniversary of the Date of Grant (the “Expiration Date”).

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          (b) Method of Exercise.

               (i) Subject to Section 3(a), the Vested Portion of the Option may be exercised by delivering
to the Company at its principal office written notice of intent to so exercise or by delivering
such notice to the Company by such other method as may be permitted by the Committee;
provided that the Option may be exercised with respect to whole Shares only. Such notice
shall specify the number of Shares for which the Option is being exercised and shall be accompanied
by payment in full of the Exercise Price. The payment of the Exercise Price may be made in cash,
or its equivalent, or (x) by exchanging Shares owned by the Participant (which are not the subject
of any pledge or other security interest and which have been owned by the Participant for at least
6 months) or (y) subject to such rules as may be established by the Committee and then only to the
extent permitted by law, through delivery of irrevocable instructions to a broker to sell the
Shares otherwise deliverable upon the exercise of the Option and to deliver promptly to the Company
an amount equal to the aggregate exercise price, or by a combination of the foregoing, provided
that the combined value of all cash and cash equivalents and the Fair Market Value of any such
Shares so tendered to the Company as of the date of such tender is at least equal to such aggregate
exercise price.

               (ii) Notwithstanding any other provision of the Plan or this Agreement to the contrary, the
Option may not be exercised prior to the completion of any registration or qualification of the
Option or the Shares under applicable state and federal securities or other laws, or under any
ruling or regulation of any governmental body or national securities exchange that the Committee
shall in its sole discretion determine to be necessary or advisable.

               (iii) Upon the Company’s determination that the Option has been validly exercised as to any of
the Shares, the Company shall issue certificates in the Participant’s name for such Shares.
However, the Company shall not be liable to the Participant for damages relating to any delays in
issuing the certificates to him, any loss of the certificates, or any mistakes or errors in the
issuance of the certificates or in the certificates themselves.

     4. No Right to Continued Employment. Neither the Plan nor this Agreement shall be
construed as giving the Participant the right to be retained in the employ of, or in any consulting
relationship to, the Company or any Affiliate. Further, the Company or an Affiliate may at any
time dismiss the Participant or discontinue any consulting relationship, free from any liability or
any claim under the Plan or this Agreement, except as otherwise expressly provided herein.

     5. Legend on Certificates. The certificates representing the Shares purchased by exercise
of the Option shall be subject to such stop transfer orders and other restrictions as the Committee
may deem advisable under the Plan or the rules, regulations, and other requirements of the
Securities and Exchange Commission, any stock exchange upon which such Shares are listed, and any
applicable Federal or state laws, and the Committee may cause a legend or legends to be put on any
such certificates to make appropriate reference to such restrictions.

     6. Transferability. Except as otherwise determined by the Committee pursuant to its
authority under Section 14(a)(iii) of the Plan, the Option is nontransferable during the

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Participant’s lifetime, except for transfers by the Participant to family members (or trusts for
their benefit) pursuant to the terms of the Plan.

     7. Withholding.

               (a) The Participant may be required to pay to the Company or any Affiliate and the Company or
any Affiliate shall have the right and is hereby authorized to withhold from any payment due or
transfer made under the Option or under the Plan or from any compensation or other amount owing to
a Participant the amount (in cash, Shares, other securities, other Awards or other property) of any
applicable federal, state or local income tax withholding requirements in respect of the Option,
its exercise, or any payment or transfer under the Option or under the Plan and to take such other
action as may be necessary in the opinion of the Company to satisfy all obligations for the payment
of such taxes, provided, however, that in no event shall the amount so withheld by the Company
exceed the minimum withholding rates required by applicable statutes.

               (b) Without limiting the generality of clause (a) above, the Participant may satisfy, in whole
or in part, the foregoing withholding liability by delivery of Shares owned by the Participant
(which are not subject to any pledge or other security interest and which have been owned by the
Participant for at least 6 months) with a Fair Market Value equal to such withholding liability or
by having the Company withhold from the number of Shares otherwise issuable pursuant to the
exercise of the option a number of Shares with a Fair Market Value equal to such withholding
liability.

     8. Securities Laws. Upon the acquisition of any Shares pursuant to the exercise of the
Option, the Participant will make or enter into such written representations, warranties and
agreements as the Committee may reasonably request in order to comply with applicable securities
laws or with this Agreement.

     9. Notices. Any notice necessary under this Agreement shall be addressed to the Company in
care of its Secretary at the principal executive office of the Company and to the Participant at
the address appearing in the personnel records of the Company for the Participant or to either
party at such other address as either party hereto may hereafter designate in writing to the other.
Any such notice shall be deemed effective upon receipt thereof by the addressee.

     10. Option Subject to Plan. By accepting this Agreement and the Award evidenced hereby,
the Participant agrees and acknowledges that the Participant has received and read a copy of the
Plan. The Option is subject to the Plan. The terms and provisions of the Plan as it may be amended
from time to time are hereby incorporated herein by reference. In the event of a conflict between
any term or provision contained herein and a term or provision of the Plan, the applicable terms
and provisions of the Plan will govern and prevail.

     11. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any time any
provision of this Agreement shall in no way be construed to be a waiver of such provision or of any
other provision hereof.

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     12. Authority of Committee. The Committee shall have full authority to interpret and
construe the terms of the Plan and this Agreement. The determination of the Committee as to any
such matter of interpretation or construction shall be final, conclusive and binding.

     13. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT SHALL
BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

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     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and the
Participant has hereunto set his hand, effective as of the Date of Grant.

	 	 	 	 	 	 	 
	 	 	POLO RALPH LAUREN CORPORATION
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	/s/ Mitchell A. Kosh
	 	 	 	 	 
	

	 	 	 	 	 	Mitchell A. Kosh
	

	 	 	 	 	 	Senior Vice President — Human Resources
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	/s/ Ralph Lauren
	 	 	 
	 	 	Participant:     Ralph Lauren

6EX-10.15

 

EXECUTION COPY

Exhibit 10.15

POLO RALPH LAUREN CORPORATION

RESTRICTED STOCK UNIT AWARD AGREEMENT

          THIS AGREEMENT (the “Agreement”) is made effective as of the 8th day of June 2004 (the “Grant
Date”), between Polo Ralph Lauren Corporation, a Delaware corporation (the “Company”), and Mr.
Ralph Lauren (the “Participant”).

R E C I T A L S:

          WHEREAS, the Company has adopted the Polo Ralph Lauren Corporation 1997 Long-Term Stock
Incentive Plan, as amended from time to time (the “Plan”), which Plan is incorporated herein by
reference and made a part of this Agreement. Capitalized terms not otherwise defined herein shall
have the same meanings as in the Plan; and

          WHEREAS, the Company and the Participant have entered into an Amended and Restated Employment
Agreement dated June 23, 2003 (such agreement, as amended from time to time, the “Employment
Agreement”), which contemplates that the Committee will grant the Unit Award (as hereinafter
defined) to the Participant; and

          WHEREAS, the Committee has determined that it would be in the best interests of the Company
and its stockholders to grant the restricted stock unit award provided for herein (the “Unit
Award”) to the Participant pursuant to the Plan and the terms set forth herein.

          NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties
agree as follows:

          1. Grant of the Restricted Stock Units. Subject to the terms and conditions of the
Plan and the additional terms and conditions set forth in this Agreement, the Company hereby grants
to the Participant a Unit Award consisting of 100,000 restricted stock units (each, a “Unit”),
subject to adjustment as set forth in the Plan. Each Unit represents the right to receive one
share of Class A Common Stock of the Company (each, a “Share”). Each Unit shall vest and become
nonforfeitable in accordance with Section 2 hereof.

          2. Vesting.

               (a) Each Unit shall vest and become nonforfeitable on the fifth (5th) anniversary
of the Grant Date, subject to accelerated vesting as set forth in Section 2(b) hereof.

 

 

               (b) (i) If the Participant’s employment with the Company is terminated (a) due to
Participant’s death or Disability (as defined below), (b) by the Company without Cause (as defined
below), (c) by the Participant for Good Reason (as defined below) or (d) by the Participant without
Good Reason (as defined below) on any date that is after the last day of the Company’s fiscal year
that ends in the 2008 calendar year or (ii) if the Company elects not to extend the Term (as
defined below) or (iii) in the event of a Change of Control (as defined in the Plan), then any then
unvested Unit shall vest immediately and the Executive shall be entitled to payment in respect of
such Unit in accordance with Section 3 hereof.

               (c) For purposes of this Agreement the terms “Disability,” “Cause,” “Good Reason” and “Term”
shall have the respective meanings specified in the Employment Agreement.

          3. Distribution of Shares.

               (a) Subject to Section 3(c) hereof, as soon as practicable following the date of the
Participant’s termination of employment with the Company or, if applicable, the date of a Change of
Control (the applicable date being referred to as the “Termination Date”) (but in no event later
than 90 days following the Termination Date), the Company shall issue and deliver to the Executive
or to his estate, as applicable, one Share in respect of each whole Unit that is vested as of the
Termination Date and cash in lieu of any vested fractional Unit (based on the fair market value per
Share on the Termination Date). The Company shall deliver to the Participant or to his estate, as
applicable, certificates in respect of such Shares along with the stock powers relating thereto.

               (b) Any Unit that remains unvested on the Termination Date, after taking into account any
applicable acceleration of vesting of Units pursuant to Section 2(b) hereof, shall be forfeited to
the Company and shall terminate immediately.

               (c) In accordance with rules and regulations prescribed by the Committee, the Executive may
elect to defer the receipt of Shares otherwise issuable pursuant to Section 3(a) hereof.

          4. Rights as a Stockholder. Except as set forth in Section 5 hereof, neither the
Participant nor Participant’s successor in interest shall have any rights as a stockholder of the
Company with respect to any Shares subject to the Units until such Shares have been issued to or in
respect of the Participant following the Termination Date.

          5. Dividend Equivalents. In the event of any issuance of a cash dividend on the
Shares (a “Dividend”), the Participant shall be credited, as of the payment date for such Dividend,
with an additional number of Units (each, a “Dividend Unit”) equal to the quotient obtained by
dividing (a) the product of (i) the number of Units granted pursuant to this Agreement and
outstanding as of the record date for such Dividend multiplied by (ii) the amount of the Dividend
per Share, divided by (b) the fair

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market value per Share on the payment date for such Dividend, such quotient to be rounded to
the nearest one-one hundredth of a Unit. Once credited, each Dividend Unit shall be treated as a
Unit granted hereunder and shall be subject to all terms and conditions set forth in this Agreement
and the Plan. For purposes of the vesting schedule set forth in Section 3 hereof, each Dividend
Unit credited hereunder shall be treated as having been granted on the Grant Date.

          6. Unit Award Subject to the Plan. By accepting this Agreement and the Unit Award
evidenced hereby, the Participant agrees and acknowledges that the Participant has received and
read a copy of the Plan. The Unit Award is subject to the Plan. The terms and provisions of the
Plan as amended from time to time are hereby incorporated herein by reference. In the event of a
conflict between any term or provision contained herein and a term or provision of the Plan, the
applicable terms and provisions of the Plan will govern and prevail.

          7. No Right to Continued Employment. Neither the Plan nor this Agreement shall be
construed as giving the Participant the right to be retained in the employ of, or in any consulting
relationship to, the Company or any Affiliate. Further, the Company or an Affiliate may at any
time dismiss the Participant or discontinue any consulting relationship, free from any liability or
any claim under the Plan or this Agreement, except as otherwise expressly provided herein.

          8. Transferability. Except as expressly contemplated in this Agreement, the Units may
not at any time be sold, assigned, transferred, pledged or otherwise encumbered.

          9. Withholding. By accepting this Unit Award, the Participant agrees to make
appropriate arrangements with the Company for satisfaction of any applicable federal, state or
local income tax withholding requirements, including the payment to the Company of all such taxes
and requirements in connection with the distribution or delivery of the Shares, or other settlement
in respect of the Units, and the Company shall be authorized to take such action as may be
necessary in the opinion of the Company’s counsel (including, without limitation, withholding
Shares otherwise deliverable to Participant hereunder and/or withholding amounts from any
compensation or other amount owing from the Company to the Participant) to satisfy all obligations
for the payment of such taxes; provided, however, that in no event shall the value of Shares so
withheld by the Company exceed the minimum withholding rates required by applicable statutes.

          10. Securities Laws. Prior to issuance and delivery of any Shares, the Participant
will make or enter into such written representations, warranties and agreements as the Committee
may reasonably request in order to comply with applicable securities laws or with this Agreement.

          11. Notices. Any notice necessary under this Agreement shall be addressed to the
Company in care of its Secretary at the principal executive office of the Company and to the
Participant at the address appearing in the personnel records of the

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Company for such Participant or to either party at such other address as either party hereto
may hereafter designate in writing to the other. Any such notice shall be deemed effective upon
receipt thereof by the addressee.

          12. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any
time any provision of this Agreement shall in no way be construed to be a waiver of such provision
or of any other provision hereof.

          13. Authority of Committee. The Committee shall have full authority to interpret and
construe the terms of the Plan and this Agreement. The determination of the Committee as to any
such matter of interpretation or construction shall be final, conclusive and binding.

          14. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT
SHALL BE GOVERNED BY THE LAWS OF STATE OF THE NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.

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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and the
Participant has hereunto set his hand, effective as of the Grant Date.

	 	 	 	 	 	 	 
	

	   POLO RALPH LAUREN CORPORATION
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	/s/ Mitchell A. Kosh
	 	 	 	 	 
	

	 	 	 	 	 	Mitchell A. Kosh
	

	 	 	 	 	 	Senior Vice President — Human Resources
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	/s/ Ralph Lauren
	 	 	 
	 	 	Participant:     Ralph Lauren

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