Document:

exv10w3

 

Exhibit 10.3

VF CORPORATION 1996 STOCK COMPENSATION PLAN

NON-QUALIFIED STOCK OPTION CERTIFICATE

	 	 	 	 	 
	 

	 	Optionee:
	 	Mackey J. McDonald
	 

	 	Date of Grant:
	 	February                     , 2008
	 

	 	Number of Shares:
	 	«Shares»
	 

	 	Option Price Per Share:
	 	«$               »

THIS IS TO CERTIFY that on the above Date of Grant, VF CORPORATION, a Pennsylvania
corporation (the “Corporation”), granted to the named Optionee a Non-Qualified Stock Option,
subject to the terms and conditions of the 1996 Stock Compensation Plan (the “Plan”), which is
incorporated herein by reference. This Option shall not be treated as an Incentive Stock Option.
The Optionee may purchase from the Corporation the Number of Shares of its Common Stock at the
Option Price Per Share identified above, subject, however, to the following terms and conditions.

1. Subject to paragraph 2 below:

	 	(a)	 	Unless the exercise date of this Option is accelerated in accordance with
Article XI of the Plan, this Option shall vest as follows:

	 	•	 	one-third (1/3) of the shares of this Option (rounded up to the nearest
whole share) shall only be exercisable for a period of nine (9) years,
commencing on the first anniversary of the Date of Grant;
	 
	 	•	 	one-third (1/3) of the shares of this Option (rounded to the nearest whole
share) shall only be exercisable for a period of eight (8) years, commencing on
the second anniversary of the Date of Grant; and
	 
	 	•	 	one-third (1/3) of the shares of this Option (rounded down to the nearest
whole share) shall only be exercisable for a period of seven (7) years,
commencing on the third anniversary of the Date of Grant; and all rights to
exercise all or any part of this Option will end upon the expiration of ten
years from the Date of Grant;

	 	(b)	 	This Option shall only be exercisable so long as the Optionee remains an
employee of the Corporation or a Subsidiary (as defined in the Plan); and
	 
	 	(c)	 	In the event that the Optionee’s employment is terminated at any time prior to
the exercise of this Option for any reason, all of the Optionee’s rights, if any then
remain, under this Option shall be forfeited and this Option shall terminate
immediately.

2. The provisions of paragraph 1 of this Certificate to the contrary notwithstanding, upon the
termination of the Optionee’s employment with the Corporation (including its Subsidiaries) at any
time prior to the expiration of ten years from the Date of Grant of this Option by reason of
Retirement (as defined in the Plan), permanent and total disability, death, or involuntary
separation of employment with the Optionee receiving severance pay in installments, the Optionee or
his estate may exercise the Option to the extent specified in this Section 2 during the applicable
period: (a) the 60 month period following the date of Retirement, permanent and total disability,
or the Optionee’s death, or (b) until the end of the period of the Optionee’s receipt of
installments of severance pay in the event of involuntary separation of employment. If an Optionee
dies during the 60 month period following such termination of employment by reason of Retirement or
permanent and total disability, then the Optionee’s estate may exercise any outstanding options
during the balance of the 60 month period; and if an Optionee dies during the period of such
receipt of installments of severance pay following an involuntary separation of employment, then
the Optionee’s estate may exercise any outstanding options during the balance of the period of
receipt of installments of severance pay. If an Optionee retires (in accordance with the
definition of Retirement in the Plan) prior to the payment of the final installment of severance
pay following an involuntary separation of employment, the Optionee may exercise any outstanding
options for the 60 month period beginning on the date of such involuntary separation of employment.
Upon the termination of the Optionee’s

 

 

employment with the Corporation due to death or permanent and total disability, any unvested
portion of the Option will vest and become immediately exercisable in full and will remain
exercisable as described in the preceding sentence. Upon termination of the Optionee’s employment
with the Corporation due to Retirement or involuntary separation of employment with the Optionee
receiving severance pay in installments, the Option shall be or become exercisable during the
post-termination exercise period only at such times as it would have been exercisable under Section
1(a) had Optionee’s employment not terminated (thus, (a) in the case of Retirement, any portion of
the Option that would not have vested before the expiration of the 60-month period following
termination will be forfeited and (b) in the case of involuntary separation of employment, any
portion of the Option that would not have vested before expiration of the period of the Optionee’s
receipt of installments of severance pay will be forfeited). Notwithstanding anything in this
Certificate to the contrary, in no event, however, shall this Option be exercisable after the
expiration of ten years from the Date of Grant.

3. During the life of the Optionee, this Option may only be exercised by the Optionee, except as
otherwise provided in the Plan. The Optionee is responsible for all applicable taxes. The
exercise of this Option is subject to the Corporation’s policies regulating trading by employees,
including any applicable “blackout” periods when trading is not permitted.

4. This Option shall be exercised by written notice to the Corporation stating the number of
shares with respect to which it is being exercised and accompanied by payment of the full amount of
the Option Price for the number of shares desired by a check payable to the order of the
Corporation, or, if acceptable to the Committee which administers the Plan, by delivery of a cash
equivalent or surrender or delivery to the Corporation of shares of its Common Stock or by a
combination of a check and shares of Common Stock. The exercise date of this Option shall be the
date upon which the notice of exercise is received by the Corporation with full payment of the
Option Price. In addition, this Option may be exercised on behalf of the Optionee by a designated
brokerage firm in accordance with the terms of the Plan and the rules of the Committee.

5. This Option may only be exercised if all personal income tax and applicable social security tax
liabilities are borne by the Optionee. This includes the satisfaction of any applicable tax which
the Corporation and/or the Subsidiary employing such Optionee may in its judgment be required to
withhold. To enable the withholding of such tax, the Corporation or the Subsidiary employing the
Optionee may receive and retain the option exercise proceeds (in the form of shares, remitting the
fair market value of such shares to the appropriate taxing authorities) or the proceeds of any sale
of Option shares (in the form of cash) on behalf of the Optionee. In the event that the tax
withheld is not sufficient to cover the Optionee’s total tax liability arising directly or
indirectly from the grant of the Option, the Optionee accepts full responsibility of such tax
liability.

6. The grant of this Option:

	 	(a)	 	is made at the discretion of the Corporation which retains certain rights
pursuant to the Plan to amend the terms of the Option or the Plan;
	 
	 	(b)	 	shall not be construed as entitling the Optionee to future option grants and/or
continued employment with the Corporation (including its Subsidiaries); and
	 
	 	(c)	 	shall not be considered as part of the Optionee’s salary for purposes of
calculating severance in the event of the Optionee’s voluntary or involuntary
termination of employment.

7. This Option is subject to the Corporation’s Forfeiture Policy for Equity and Incentive Awards in
the Event of Restatement of Financial Results as in effect at the date of this Option. Such Policy
imposes conditions that may result in forfeiture of the Option or the proceeds to you resulting
from the Option (a so-called “clawback”) in certain circumstances if the Corporation’s financial
statements are required to be restated as a result of misconduct.

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8. The Corporation (including the Subsidiary employing the Optionee) is hereby authorized to
transmit any personal information that it deems necessary to facilitate the administration of the
Option grant.

9. This Certificate, including the rights and obligations of the Optionee and the Corporation
hereunder, is subject in all respects to the Plan, which shall be controlling in the event of any
inconsistency with or omission from this Certificate.

By accepting the grant of this Option, the Optionee acknowledges that he or she understands and
agrees to its terms.

	 	 	 	 	 
	 	V. F. CORPORATION

Eric C. Wiseman

President and Chief Executive Officer

 	 
	 	 	 
	 	 	 
	 	 	 
	 

3exv10w4

 

Exhibit 10.4

VF CORPORATION EXECUTIVE INCENTIVE COMPENSATION PLAN

As Amended and Restated Effective February 5, 2008

I. INTRODUCTION

     The objective of the Executive Incentive Compensation Plan, as amended and restated (the
“Plan”), is to provide incentive bonus compensation to the most senior members of the management
team of VF Corporation (the “Company”) upon the achievement of performance goals established for
the Company for each fiscal year. The Plan is intended to provide an additional means to attract
and retain talented executives, and to link a significant element of each participant’s
compensation opportunity to measures of the Company’s performance, in order to motivate the
Company’s senior management team toward an even greater contribution to the results of the Company.

II. DEFINITIONS

     A. EICP COMMITTEE — The members of the Compensation Committee of the Board of Directors of
the Company who are intended to be “outside directors” as defined or interpreted for purposes of
Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”).

     B. PARTICIPANT — An employee of the Company or a subsidiary who has been designated by the
Board of Directors of the Company as an “executive officer” of the Company pursuant to
Rule 16a-1(f) of the Securities Exchange Act of 1934 and selected for participation in a given Plan
Period by the EICP Committee.

     C. PERFORMANCE OBJECTIVE — The performance goal established by the EICP Committee for each
Plan Period, which must be reached as a condition to payment of an Incentive Award for that Plan
Period. The Performance Objective shall be comprised of specified corporate, business group or
divisional levels of performance relating to one or more of the following performance criteria:
earnings per share; net earnings; pretax earnings; profit before taxes; operating income; net
sales; market share; balance sheet measurements; cash return on assets; return on capital, book
value; shareholder return, or return on average common equity.

     D. PLAN PERIOD — The Company’s fiscal year; provided, however, that the EICP Committee may
specify a different Plan Period to meet unusual circumstances.

     E. RETIREMENT — As used in the Plan, Retirement is defined as employment separation from the
Company or any of its Subsidiaries after attaining age 55 and at least 10 years of service with the
Company and/or any of its Subsidiaries.

     F. SUBSIDIARY — Any majority-owned business organization of the Company or its direct or
indirect subsidiaries, including but not limited to corporations, limited liability companies,
partnerships, and any “subsidiary corporation” as defined in Section 424(f) of the Code that is a
subsidiary of the Company.

     G. TARGET INCENTIVE AWARD — The target incentive bonus established by the EICP Committee for a
Participant for a Plan Period.

 

 

III. OPERATION OF THE PLAN

     A. ESTABLISHMENT OF TARGET INCENTIVE AWARDS AND PERFORMANCE OBJECTIVE — No later than 90 days
after the commencement of each Plan Period but in no event after more than 25% of the Plan Period
has elapsed, the EICP Committee will establish in writing a Target Incentive Award for each
Participant for such Plan Period and the Performance Objective for such Participant. The EICP
Committee will establish in writing a range of values for the Performance Objective for such Plan
Period, which values will represent a percentage of the Target Incentive Award that may be earned
for achievement of the Performance Objective at a corresponding level (the “Incentive Awards”),
subject to Section III. C. For example, the EICP Committee may establish a threshold level of
achievement of the Performance Objective which, if not attained, will result in no Incentive Award,
and the EICP Committee likewise may establish a “stretch” level of achievement of the Performance
Objective which, if attained, will result in an Incentive Award equal to greater than 100% of the
Target Incentive. In establishing the level of Performance Objective to be attained, the EICP
Committee may disregard or offset the effect of such factors as extraordinary and/or nonrecurring
items as determined in accordance with generally accepted accounting principles, and changes in
accounting standards.

     B. CALCULATION OF INCENTIVE AWARDS — Incentive Awards will be paid to each Participant by
reference to the actual attainment of the Performance Objective relative to the Performance
Objective levels established by the EICP Committee for the Plan Period. Notwithstanding the
foregoing or any provision of Section IV, the EICP Committee may, in its sole discretion, exercise
negative discretion to reduce earned Incentive Awards. In addition, in the case of a Participant
who is not deemed by the Committee to be a “covered employee” for a given Plan Period, the
Committee may exercise discretion to increase the amount of the Incentive Award determined
hereunder.

     C. MAXIMUM INCENTIVE AWARD — Other provisions of the Plan notwithstanding, in each calendar
year a Participant may be authorized to earn Incentive Awards under the Plan up to but not
exceeding the Participant’s Annual Limit. For this purpose, the Participant’s Annual Limit shall
equal $3.0 million plus the amount of the Participant’s unused Annual Limit as of the close of the
previous calendar year. For this purpose, (i) “earning” means satisfying performance conditions so
that an amount becomes payable, without regard to whether it is to be paid currently or on a
deferred basis or continues to be subject to any service requirement or other non-performance
condition, and (ii) a Participant’s Annual Limit is used to the extent an amount may be potentially
earned or paid under an Incentive Award, regardless of whether such amount is in fact earned or
paid.

     D. PAYMENT OF INCENTIVE AWARDS — Payment of Incentive Awards for a Plan Period will be made
within 30 days following the EICP Committee’s certification in writing as to the level of
Performance Objective attained for the Plan Period, except to the extent (i) the Committee has
specified that Incentive Awards will be paid on a deferred basis or subject to additional
conditions to payment, or (ii) payment has been deferred by the Participant pursuant to any Company
deferred compensation plan then in effect. Deferrals shall be mandated or permitted at the
election of the Participant only in compliance with Code Section 409A. The specific rules
applicable to the timing of deferral elections and the permitted distribution dates for deferrals
are incorporated by reference in this Plan from the 1996 Stock Compensation Plan, as amended and
restated, including Section 12.10 of that plan and any applicable Exhibit thereto setting forth
such rules.

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IV. CONTINGENCIES

     A. EMPLOYMENT TERMINATION — Except as provided in Sections IV. B, IV. C and IV. E regarding
permanent disability, death and Retirement, or unless the EICP Committee exercises its discretion
under Section IV. D, a Participant who terminates employment voluntarily or who is terminated
involuntarily prior to his receipt of an Incentive Award payment under this Plan forfeits all such
payments, except as provided under the terms of any required or permitted deferral of such
payments. A Participant who is employed by the Company at the end of a Plan Period shall not be
deemed or considered to have accrued any right to or vested in an Incentive Award for the Plan
Period.

     B. PERMANENT DISABILITY — A Participant whose employment with the Company is terminated by
reason of permanent disability is eligible to participate in the Plan for the Plan Period in which
he becomes permanently disabled. The Incentive Award payment will be calculated as if employment
had continued throughout the Plan Period based on actual performance for the Plan Period (and
subject to the Committee’s right under Section III. B to exercise discretion), but, unless
otherwise determined by the Committee, the amount of the Incentive Award payable will be prorated
according to the Participant’s actual length of active service during the Plan Period.

     C. DEATH — The estate of a Participant whose employment with the Company is terminated by
reason of death during a Plan Period is eligible to receive a pro rata share of the Incentive Award
payment to which the Participant would have been entitled. The Incentive Award payment will be
calculated as if employment had continued throughout the Plan Period based on actual performance
for the Plan Period (and subject to the Committee’s right under Section III. B to exercise negative
discretion), but, unless otherwise determined by the Committee, the amount of the Incentive Award
payable will be prorated according to the Participant’s actual length of active service during the
Plan Period.

     D. EICP COMMITTEE DISCRETION — The EICP Committee may grant an Incentive Award for a Plan
Period to a terminated employee who had been a Plan Participant for part or all of the Plan Period
if, in the EICP Committee’s judgment, the payment of such Incentive Award would be in the best
interest of the Company. Subject to the Committee’s discretion under Section III. B above, any such
Incentive Award payment will be calculated as if termination had not occurred based on actual
performance for the relevant Plan Period, but, unless otherwise determined by the Committee, with
payment prorated according to the Participant’s actual length of active service during the Plan
Period.

     E. RETIREMENT — A Participant whose Retirement occurs prior to the distribution of an
Incentive Award for a Plan Period does not forfeit the payment of such Incentive Award. The
Incentive Award payment will be calculated as if Retirement had not occurred based on actual
performance for the relevant Plan Period (and subject to the Committee’s right under Section III. B
to exercise discretion), but, unless otherwise determined by the Committee, payment will be
prorated according to the Participant’s actual length of active service during the Plan Period.

     F. TIMING RULE IN CASE OF AWARDS MADE FOLLOWING TERMINATION — Incentive Awards payable to a
Participant (or his estate) following termination of employment shall be paid at the time other
Incentive Awards are payable to continuing employee Participants in respect of the relevant Plan
Period but in any event by March 15 of the year following the year in which the Plan Period ends.
If the Participant’s rights relating to an Incentive Award cause it to be a deferral of
compensation under Code Section 409A, no acceleration of the time of payment

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will be permitted to the extent necessary to comply with applicable rules under Code Section
409A.

     G. ADDITIONAL FORFEITURE CONDITION. Incentive Awards relating to a Plan Period beginning in
December 2007 or later shall be subject to the Company’s “Forfeiture Policy For Equity and
Incentive Awards In the Event of Restatement of Financial Results” as implemented in February 2008
or, if later modified, as in effect thereafter at the time the Participant’s Incentive Award was
authorized for any such Plan Period. Such Policy imposes conditions on a Participant’s right to
receive payments under an Incentive Award and right to retain previous payments in settlement of an
Incentive Award (a so-called “clawback”) in certain circumstances if the Company’s financial
statements are required to be restated as a result of misconduct.

V. ADMINISTRATION

     The EICP Committee shall have the authority and responsibility for all aspects of
administration of the Plan, including but not limited to:

     A. Interpretation of the Plan.

     B. Establishment of the Target Incentive Awards, Performance Objective and related terms under
Section III. A. for each Plan Period.

     C. Certification in writing as to the level of each Performance Objective attained for each
Plan Period, and that other material terms upon which payment of Incentive Awards was conditioned
have been satisfied.

     D. Determination of Incentive Awards and final approval of payments to Participants.

     E. Determination of permanent disability and Retirement for purposes of the Plan.

     F. Payment of a prorated award to a terminated employee under Section IV. D. if, in its
judgment, the payment of such Incentive Award would be in the best interest of the Company.

     G. Certification of death for the purpose of payment of a prorated Incentive Award to the
estate of a Participant.

     The EICP Committee may delegate to specified officers or employees of the Company
authority to perform ministerial functions under the Plan.

VI. AMENDMENT AND TERMINATION

     The EICP Committee shall have the power to amend, modify, suspend or terminate any part of the
Plan at any time; provided, however, that, (i) any such change to the Plan that is beyond the
delegated authority of the EICP Committee shall be subject to the approval of the Board of
Directors of the Company, and (ii) any such amendment or modification shall be subject to the
approval of the shareholders of the Company if such shareholder approval is required to preserve
the Company’s federal income tax deduction for Incentive Awards paid under the Plan pursuant to the
“other performance-based compensation” exception in Section 162(m)(4)(C) of the Code.

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VII. GENERAL PROVISIONS

     A. NO RIGHT TO EMPLOYMENT — Eligibility to receive an Incentive Award or the grant of an
Incentive Award shall not be construed as giving a Participant the right to be retained in the
employ of the Company, nor will it affect in any way the right of the Company to terminate such
employment at any time, with or without cause. In addition, the Company may at any time dismiss a
Participant from employment free from any liability or any claim under the Plan, unless otherwise
expressly provided in the Plan.

     B. NO LIMIT ON OTHER COMPENSATION ARRANGEMENTS — Nothing contained in the Plan shall prevent
the Company from adopting or continuing in effect other or additional compensation arrangements,
and such arrangements may be either generally applicable or applicable only in specific cases.

     C. TAX WITHHOLDING. The Company will deduct from any Incentive Award or other payment to a
Participant any Federal, state, or local withholding or other tax or charge which the Company is
then required to deduct under applicable law.

     D. NON-TRANSFERABILITY. The opportunity to earn an Incentive Award, any resulting Incentive
Award, and any other purported right hereunder, shall be non-assignable and non-transferable, and
shall not be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, hypothecation or garnishment by a Participant’s creditors or to or in favor of any
party other than the Company or a subsidiary or subject to any lien, obligation, or liability of
the Participant to any party other than the Company or a subsidiary.

     E. GOVERNING LAW — The validity, construction and effect of the Plan or any Incentive Award
hereunder shall be determined in accordance with the laws of the State of North Carolina, without
giving effect to principles of conflicts of laws.

     F. SEVERABILITY — If any provision of the Plan or any Incentive Award is or becomes or is
deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or
any Incentive Award under any law deemed applicable by the EICP Committee, such provision shall be
construed or deemed amended to conform to applicable laws, or if it cannot be so construed or
deemed amended without, in the determination of the EICP Committee, materially altering the purpose
or intent of the Plan or the Incentive Award, such provision shall be stricken as to such
jurisdiction or Incentive Award, and the remainder of the Plan or any such Incentive Award shall
remain in full force and effect.

     G. NO TRUST OR FUND CREATED — Neither the Plan nor any Incentive Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary relationship between the
Company and a Participant or any other person. To the extent that any Participant or other person
acquires a right to receive payments from the Company pursuant to the Plan, such right shall be no
greater than the right of any unsecured general creditor of the Company.

     H. HEADINGS — Headings are given to the Sections and subsections of the Plan solely as a
convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.

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VIII. EFFECTIVE DATE

     The Plan is effective initially for the fiscal year ended December 31, 1994, subject to
approval by the shareholders of the Company at the annual meeting of shareholders on April 19,
1994. This amendment and restatement of the Plan is effective for awards based on performance in
the fiscal year ending January 3, 2009 and in later Plan Periods, subject to the reapproval of the
business criteria that may be used for Performance Objectives to the extent required under Code
Section 162(m) by shareholders of the Company. In addition, provisions applicable to Incentive
Awards and rights relating thereto to ensure compliance with Code Section 409A shall apply to
Participants with any such rights as of December 31, 2008 (and the Committee may deem such rules
applicable to such rights at earlier dates to promote compliance with Section 409A).

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