Document:

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                                                                   EXHIBIT 10(i)

                DESCRIPTION OF LIZ CLAIBORNE, INC. 2000 SALARIED
                          EMPLOYEE INCENTIVE BONUS PLAN

For the 2000 fiscal year, Liz Claiborne, Inc. maintained a bonus plan for full
time salaried employees under which bonuses were earned based upon a combination
of return on invested operating capital and earnings per share, as measured
against pre-established targets, and, as applicable, achievement of targeted
levels of divisional direct operating profit and/or departmental performance
considerations and the achievement of individual goals, subject to certain terms
and conditions. A similar bonus plan is anticipated for 2001.<PAGE>   1
                                                                   EXHIBIT 10(q)

                DESCRIPTION OF SUPPLEMENTAL LIFE INSURANCE PLANS

Vice Presidents of Liz Claiborne, Inc. (the "Company") receive universal life
insurance policies which provide coverage equal to two times annual base salary.
The Company pays the premiums on each policy during the employment period,
enabling the employee to have a portable life insurance policy with a minimal
cash surrender value.<PAGE>   1
                                                              EXHIBIT 10(v)(iii)

                               LIZ CLAIBORNE, INC.
                    EXECUTIVE TERMINATION BENEFITS AGREEMENT

     This Executive Termination Benefits Agreement (this "Agreement"),  dated as
of the 1st day of  January,  2001,  is by and  between LIZ  CLAIBORNE,  INC.,  a
Delaware corporation (the "Company"), and PAUL R. CHARRON (the "Executive").
     WHEREAS, the Company's Board of Directors (the "Board") recognizes that the
possibility  of a change in  control  of the  Company  and the  uncertainty  and
questions  which it may raise may result in the departure or  distraction of the
Executive to the detriment of the Company and its stockholders;
     WHEREAS, the Board has determined that appropriate steps should be taken to
reinforce and encourage the continued  attention and dedication of the Executive
to his/her  assigned  duties in the face of the  inevitable  distraction  of the
Executive  by virtue of the  personal  uncertainties  and risks  created  by the
possibility, threat or occurrence of a change in control of the Company;
     WHEREAS,  should the  Company  be faced  with a possible  change in control
situation,  in addition to the Executive's regular duties,  he/she may be called
upon to assist in the assessment of proposals,  advise  management and the Board
as to whether such  proposals  would be in the best interests of the Company and
its stockholders, and to take such other actions as the Board might determine to
be appropriate.
     NOW,  THEREFORE,  to assure  the  Company  that it will have the  continued
undivided  attention  and  services of the  Executive  and the  availability  of
his/her advice and counsel notwithstanding the possibility, threat or occurrence
of a bid to take over  control of the  Company,  and to induce the  Executive to
remain in the employ of the Company in such a  circumstance,  for the benefit of
the Company and its shareholders, and for other good and valuable consideration,
the Company and the Executive agree as follows:

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1.   Term of Agreement.

     (a) Except as otherwise  provided in Section 1(b) below, (i) this Agreement
shall be  effective as of the date hereof and shall  continue in effect  through
December  31,  2003 and (ii)  commencing  on January 1, 2004 and each  January 1
thereafter,  this Agreement shall be  automatically  extended for one additional
year unless,  not later than June 30th of the  preceding  year,  either party to
this  Agreement  gives  notice to the other  that  this  Agreement  shall not be
extended under this Section 1(a); provided,  however, that no such notice by the
Company  shall  be  effective,  and this  Agreement  shall  be  extended  for an
additional  year, if a Change in Control or Potential Change in Control (both as
defined in Section 2 below)  shall have  occurred or occurs at any time prior to
the date of such notice or within the 12-month  period  beginning on the date of
such notice.

     (b) If a Change in  Control  shall  have  occurred  at any time  during the
period in which this Agreement is effective,  then notwithstanding any provision
hereof to the contrary, this Agreement shall be effective and continue in effect
for (i) the  remainder of the month in which the Change in Control  occurred and
(ii) a term of  thirty-six  (36) months beyond the month in which such Change in
Control  occurred;  provided that if any  obligations  of the Company  hereunder
shall not have been fully and finally  discharged  at the end of such thirty six
(36) month period,  this Agreement shall remain in effect until such obligations
shall have been finally discharged in full. The period commencing on the earlier
of a Potential Change in Control (if applicable) or Change in Control and ending
with the  conclusion  of such  thirty-sixth  month  period  shall be referred to
hereinafter as the "Protected Period."

2.   Change in Control and Potential Change in Control.

     (a) For purposes of this  Agreement,  a "Change in Control" shall be deemed
to have occurred:

          (i) if any  person as defined  in  Section  3(a)(9) of the  Securities
          Exchange  Act of 1934,  as  amended  from time to time (the  "Exchange
          Act"),  and as used in Sections 13(d) and 14(d)  thereof,  including a
          "group" as defined in Section  13(d) of the Exchange Act (a "Person"),
          but  excluding  the  Company,  any  subsidiary  of the Company and any
          employee  benefit plan  sponsored or  maintained by the Company or any
          subsidiary of the Company  (including  any trustee of such plan acting
          as trustee),  directly or indirectly,  becomes the "beneficial  owner"
          (as defined in Rule 13(d)-3  under the  Exchange  Act, as amended from
          time to time) of Company securities representing 25% or more of either
          (i) the then outstanding  shares of the Company's common stock or (ii)
          the combined voting power of the Company's then

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          outstanding  voting  securities  entitled  to  vote  generally  in the
          election  of  directors;   provided,   however,   that  the  following
          acquisitions  shall  not  constitute  a  Change  in  Control:  (A) any
          acquisition  directly from the Company  (excluding an  acquisition  by
          virtue  of  the  exercise  of a  conversion  privilege),  or  (B)  any
          acquisition  by  any  corporation  or  similar  entity  pursuant  to a
          reorganization,    merger   or   consolidation   if   following   such
          reorganization,  merger or consolidation,  the conditions described in
          sub-clauses  (1),  (2), and (3) of Section  2(a)(iii)  below have been
          satisfied; or

          (ii) if individuals  who, as of the date hereof,  constitute the Board
          (the "Incumbent  Board") cease for any reason to constitute at least a
          majority of the Board; provided, however, that any individual becoming
          a director subsequent to the date hereof whose election, or nomination
          for election by the Company's stockholders,  was approved by a vote of
          at  least  two-thirds  (2/3)  of the  directors  then  comprising  the
          Incumbent  Board shall be considered as though such  individual were a
          member of the Incumbent  Board, but excluding,  for this purpose,  any
          such individual whose initial  assumption of office occurs as a result
          of an  actual or  threatened  election  contest  with  respect  to the
          election  or  removal  of  directors  or other  actual  or  threatened
          solicitation  of proxies or consents by or on behalf of a Person other
          than the Board; or

          (iii) upon consummation of a  reorganization,  merger or consolidation
          of the  Company (a  "Business  Combination"),  in each  case,  unless,
          following such Business  Combination,  (1) all or substantially all of
          the  individuals   and  entities  who  were  the  beneficial   owners,
          respectively,  of the then  outstanding  shares of common stock of the
          Company and the combined voting power of the then  outstanding  voting
          securities of the Company  entitled to vote  generally in the election
          of  directors   immediately   prior  to  such   Business   Combination
          beneficially  own,  directly or  indirectly,  more than sixty  percent
          (60%) of,  respectively,  the then outstanding  shares of common stock
          and  the  combined  voting  power  of  the  then  outstanding   voting
          securities entitled to vote generally in the election of directors, as
          the case may be,  of the  corporation  resulting  from  such  Business
          Combination (including,  without limitation,  a corporation which as a
          result of such  transaction  owns the Company or all or  substantially
          all of the  Company's  assets  either  directly or through one or more
          subsidiaries),  (2) no Person (excluding (A) any employee benefit plan
          (or related trust) of the Company or such  corporation  resulting from
          such  Business  Combination  and (B) any Person  beneficially  owning,
          immediately prior to such reorganization, merger or consolidation, 25%
          or more of,  respectively,  the then outstanding  shares of the common
          stock  of the  Company,  or the  combined  voting  power  of the  then
          outstanding   voting  securities  of  the  Company  entitled  to  vote
          generally in the election of directors) beneficially owns, directly or
          indirectly, 25% or more of, respectively,  the then outstanding shares
          of  common  stock of the  corporation  resulting  from  such  Business
          Combination  or the  combined  voting  power of the  then  outstanding
          voting  securities of such  corporation  entitled to vote generally in
          the election of directors,  and (3) at least a majority of the members
          of the  board of  directors  of the  corporation  resulting  from such
          Business  Combination  were members of the Incumbent Board at the time
          of the  execution  of the  initial  agreement  relating  to, or of the
          action  of  the   Incumbent   Board   providing   for,  such  Business
          Combination; or

          (iv)  upon  consummation  of the sale or other  disposition  of all or
          substantially all of the assets of the Company,  unless following such
          transaction  (1)  all or  substantially  all of  the  individuals  and
          entities who were the  beneficial  owners,  respectively,  of the then
          outstanding  shares of common  stock of the Company  and the  combined
          voting power of the then outstanding  voting securities of the Company
          entitled to vote generally in the election

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          of directors  immediately prior to such transaction  beneficially own,
          directly   or   indirectly,   more  than  sixty   percent   (60%)  of,
          respectively,  the then  outstanding  shares of  common  stock and the
          combined  voting  power  of the  then  outstanding  voting  securities
          entitled to vote  generally in the election of directors,  as the case
          may be, of the acquiring corporation (including, without limitation, a
          corporation  which as a result of such transaction owns the Company or
          all or  substantially  all of the Company's  assets either directly or
          through one or more  subsidiaries),  (2) no Person  (excluding (A) any
          employee  benefit  plan (or  related  trust)  of the  Company  or such
          acquiring   corporation  and  (B)  any  Person  beneficially   owning,
          immediately prior to such transaction,  25% or more of,  respectively,
          the then outstanding shares of the common stock of the Company, or the
          combined voting power of the then outstanding voting securities of the
          Company  entitled to vote  generally  in the  election  of  directors)
          beneficially   owns,   directly  or   indirectly,   25%  or  more  of,
          respectively,  the then  outstanding  shares  of  common  stock of the
          acquiring  corporation  or the  combined  voting  power  of  the  then
          outstanding  voting  securities of such  corporation  entitled to vote
          generally in the election of directors, and (3) at least a majority of
          the members of the board of  directors  of the  acquiring  corporation
          were members of the  Incumbent  Board at the time of the  execution of
          the initial  agreement  relating to, or of the action of the Incumbent
          Board providing for, such sale or disposition; or

          (v)  approval  by  the  stockholders  of  the  Company  of a  complete
          liquidation or dissolution of the Company.

     (b) For purposes of this Agreement,  a "Potential  Change in Control" shall
be deemed to have  occurred if (i) the Company  enters  into an  agreement,  the
consummation  of which would  result in the  occurrence  of a Change in Control;
(ii) any Person (including the Company) publicly  announces an intention to take
or to consider taking actions which if consummated  would constitute a Change in
Control; or (iii) the Board adopts a resolution to the effect that, for purposes
of this Agreement, a Potential Change in Control has occurred; provided that the
Board shall not be precluded  from  adopting a resolution to the effect that for
purposes  of this  Agreement,  it is the good faith  opinion of the Board that a
Potential  Change in Control has been  abandoned and that a Potential  Change in
Control no longer exists.

     (c) For  purposes  of  Sections  3  through 9 of this  Agreement,  the term
"Company" shall include Liz Claiborne,  Inc. and any successor thereto,  whether
by merger,  reorganization,  consolidation,  acquisition of substantially all of
its assets or any other means.

3.   Covered Termination.

     (a) In the event  that  Executive's  employment  is  terminated  during the
Protected  Period either (i) by the Company without Cause (as defined in Section
3(c) below) or (ii) by the Executive for Good

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Reason (as defined in Section 3(b) below) (each, a "Covered  Termination"),  the
Company will provide the  Executive  with the payments and benefits set forth in
Section 4 below.

     (b) For purposes of this Agreement, "Good Reason" shall mean the occurrence
of one or more of the following events  (regardless of whether any other reason,
other than Cause as provided below, for such termination exists or has occurred,
including without limitation other employment):

          (i) failure to elect or reelect or otherwise maintain Executive in the
          offices  or  positions,   or  substantially   equivalent   offices  or
          positions,  of or with the Company,  which Executive held  immediately
          prior to the Change of Control;

          (ii) a  significant  adverse  change  in the  nature  or  scope of the
          authorities, powers, functions, duties or responsibilities attached to
          the position  with the Company which the  Executive  held  immediately
          prior to the Change in Control;

          (iii) a  reduction  by the  Company,  without  the  Executive's  prior
          consent,  in either (1) the Executive's annual base salary immediately
          prior to the  Change in Control or (2) the  Executive's  target  bonus
          opportunity  (expressed  as a percentage  of  Executive's  annual base
          salary) immediately prior to the Change in Control;

          (iv) the Company's  requiring the Executive,  without the  Executive's
          prior  consent,  to be based  more  than  fifty  (50)  miles  from the
          Company's offices at which the Executive is based immediately prior to
          the Change in Control  (excluding for this purpose  required travel on
          the Company's business to an extent substantially  consistent with the
          Executive's  business  travel  obligations  immediately  prior  to the
          Change in  Control),  or, in the event the  Executive  consents to any
          such  relocation  of his/her  offices,  the  failure by the Company to
          provide  the  Executive  with  all of the  benefits  of the  Company's
          relocation  policy as in  effect  immediately  prior to the  Change in
          Control;

          (v) the failure by the Company, without the Executive's prior consent,
          to  pay to the  Executive  any  portion  of  the  Executive's  current
          compensation (for purposes of this clause (v), "current  compensation"
          shall mean the Executive's annual base salary as in effect on the date
          hereof or as the same may be  increased  from  time to time,  plus the
          bonuses awarded to Executive  pursuant to the Company's cash incentive
          bonus plan), or to pay to the Executive any portion of any installment
          of deferred  compensation under any deferred  compensation  program of
          the Company  within  twenty (20) days after request for payment by the
          Executive after such deferred compensation is due;

          (vi) the failure by the Company to continue in effect any then ongoing
          compensation  or  benefit  plan in which  the  Executive  participates
          immediately prior to the Change in Control and which is significant to
          the Executive's total compensation  opportunity on either an annual or
          long-term  basis,  including,  but not limited to, the Company's  2000
          Stock  Incentive  Plan,  any  other  long-term  incentive  plan of the
          Company, or any substitute plan for any of the foregoing adopted prior
          to the Change in Control, unless an equitable arrangement (embodied in
          an ongoing  substitute or alternative plan) has been made with respect
          to  such  plan,  or  the  failure  by  the  Company  to  continue  the
          Executive's  participation  therein on a basis not significantly  less
          favorable  to  Executive,  in terms of the amount of the  compensation
          opportunities so provided, to those provided to Executive immediately

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          prior to the Change in Control, it being agreed,  without limiting the
          foregoing,  for the  avoidance  of doubt,  that the  Company  shall be
          deemed to have failed to continue  the  Executive's  participation  in
          such plans on a basis not significantly less favorable to Executive in
          the event that  Executive's  target long-term  incentive  compensation
          opportunity  (expressed  as a percentage of  Executive's  base salary)
          subsequent to the Change of Control shall not equal or exceed  his/her
          long-term   incentive   compensation   opportunity   (expressed  as  a
          percentage of Executive's base salary) as in effect  immediately prior
          to the Change in Control;

          (vii) the failure by the Company to continue to provide the  Executive
          with  benefits  comparable  in the  aggregate to those  enjoyed by the
          Executive under the Company's  retirement,  life  insurance,  medical,
          dental,  health,  accident and disability plans in which the Executive
          was participating immediately prior to the Change in Control;

          (viii) the  failure of the  Company  to obtain an  agreement  from any
          successor   to  assume  and  agree  to  perform   this   Agreement  as
          contemplated  by Section 9 below  prior to the  effective  date of any
          such  succession,  or, if such an agreement  is not so  obtained,  the
          failure of the Company, within three (3) business days after receiving
          a written request from the Executive for such agreement, to so provide
          such agreement; or

          (ix) any purported termination of the Executive's  employment which is
          not  effected  pursuant  to a Notice  of  Termination  satisfying  the
          requirements of Section 5(a) below.

The  Executive's  continued  employment  shall not  constitute  consent to, or a
waiver of rights with  respect to, any act or failure to act  constituting  Good
Reason hereunder. Notwithstanding the foregoing, the occurrence of an event that
would  otherwise  constitute  Good Reason  hereunder  shall cease to be an event
constituting  Good  Reason  if the  Executive  does  not  provide  a  Notice  of
Termination to the Company within one hundred eighty (180) days of the date that
the Executive first becomes aware of the occurrence of such event.

     (c) For purposes of this  Agreement,  "Cause"  shall mean and be limited to
(i) Executive's willful and intentional repeated failure or refusal,  continuing
after notice that  specifically  identifies  the  breach(es)  complained  of, to
perform substantially his/her material duties,  responsibilities and obligations
(other than a failure  resulting from Executive's  incapacity due to physical or
mental  illness or other  reasons  beyond the control of  Executive),  and which
failure or refusal  results in  demonstrable  direct and material  injury to the
Company; (ii) any willful and intentional act or failure to act involving fraud,
misrepresentation,   theft,   embezzlement,   dishonesty   or  moral   turpitude
(collectively, "Fraud") which results in demonstrable direct and material injury
to the Company; (iii) conviction of (or a plea of nolo

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contendere  to) an offense  which is a felony in the  jurisdiction  involved  or
which is a misdemeanor in the jurisdiction involved but which involves Fraud; or
(iv) the  Executive's  complete  inability to perform his/her  material  duties,
responsibilities  and obligations on account of a physical or mental  incapacity
or impairment for a period of more than 180 consecutive days or for an aggregate
of 240 days within a 360-day period,  which  incapacity or impairment  continues
for more than thirty (30) days after Executive's  receipt of written notice from
the Company  given after such 180 or 240 day period has run without  Executive's
return,  on a  substantially  full-time  basis,  to employment.  For purposes of
determining whether Cause exists, no act, or failure to act, on Executive's part
shall be deemed "willful" or  "intentional"  unless done, or omitted to be done,
by Executive in bad faith, and without  reasonable belief that his/her action or
omission was in the best  interests of the Company.  For purposes of clause (iv)
above, a  determination  of Executive's  complete  inability to perform  his/her
material  duties,  responsibilities  and  obligations  will be made by a  single
physician  satisfactory  to both  Executive  and the Company;  provided  that if
Executive and the Company cannot agree as to a single physician,  then each will
select a physician and these two together will select a third  physician,  whose
determination will be binding on Executive and the Company. Executive shall have
the right to present to the  Company and such  physician  such  information  and
arguments on Executive's  behalf as Executive deems  appropriate,  including the
opinion of Executive's personal physician.

     Notwithstanding  the foregoing,  the Executive  shall not be deemed to have
been  terminated  for "Cause"  hereunder  unless and until there shall have been
delivered to the  Executive a copy of a resolution (a "Cause  Resolution")  duly
adopted by the  affirmative  vote of not less than two thirds (2/3) of the Board
then in office at a meeting of the Board  called upon  reasonable  notice to all
Directors and held for such purpose,  after  reasonable  notice to the Executive
and an  opportunity  for  the  Executive,  together  with  his  counsel  (if the
Executive  chooses to have counsel present at such meeting),  to be heard before
the Board at such meeting, finding that, in the good faith opinion of the Board,
the Executive had committed an act  constituting  "Cause" as herein  defined and
specifying the particulars thereof in detail. Nothing herein will

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limit the right of the Executive or his beneficiaries to contest the validity or
propriety of any such determination and/or Cause Resolution.

     (d) Nothing  contained in this  Agreement is intended to, or shall  operate
to,  preclude the payment of any amounts  (other than cash  severance  benefits)
otherwise  payable to the Executive under any of the Company's  employee benefit
plans,  stock plans,  programs  and  arrangements  and/or  under any  employment
agreement,  or to  limit  or  otherwise  adversely  affect  such  rights  as the
Executive may have under any contract or agreement with the Company.

4.   Severance Payments and Benefits.

     (a) In lieu of any other cash severance payments to which the Executive may
otherwise be entitled  (and which other cash  severance  payments the  Executive
hereby expressly  waives),  and subject to the provisions  regarding  cutback of
benefits in certain  circumstances as expressly  provided in Section 6(h) below,
the Company shall pay or provide to the  Executive  the  following  amounts (the
"Severance  Payments") upon the occurrence of a Covered  Termination  during the
Protected Period:

          (i) An  amount  equal to three (3)  times  the  amount of  Executive's
          effective annual base salary rate, as in effect immediately prior to a
          Change of Control or the Date of  Termination  (as  defined in Section
          5(b), below), whichever amount is higher;

          (ii) an  amount  equal to three (3) times  the  average  annual  bonus
          earned by the Executive  under the Company's cash incentive bonus plan
          in respect of the three  fiscal  years of the Company  ending prior to
          (x) the date on which a Change of Control  occurred or (y) the date on
          which the Date of Termination occurred, whichever amount is higher;

          (iii) an  amount  equal to the  Executive's  annual  bonus  earned  or
          accrued in respect of any prior fiscal year of the Company but not yet
          paid as of the Date of Termination; and

          (iv) an amount  equal to the  product of (x) the  greatest  of (A) the
          Executive's   target  bonus   opportunity  under  the  Company's  cash
          incentive  bonus  plan  for the  fiscal  year  in  which  the  Date of
          Termination  occurs; or (B) the average bonus the Executive earned for
          the three (3) fiscal  years  preceding  the  fiscal  year in which the
          Change  in  Control  occurred,  multiplied  by  (y)  a  fraction,  the
          numerator of which is the number of months and partial  months expired
          in the fiscal  year of the  Company  in which the Date of  Termination
          occurs, through the Date of Termination,  and the denominator of which
          is twelve (12).

     (b) In case of a  Covered  Termination  during  the  Protected  Period,  in
addition to the payments  provided for in Section 4(a) above, the Company shall,
during the period  ending  thirty six (36)  months  after the month in which the
Date of Termination occurs, arrange at the Company's sole expense to

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provide the Executive and his/her dependents with life, medical, dental, health,
and disability insurance benefits at least equal, in type and level of coverage,
to those which the Executive and his/her  dependents were receiving  immediately
prior to the Notice of Termination (without,  however,  giving any effect to any
reduction  in  such  benefits  subsequent  to a  Change  in  Control).  Benefits
otherwise  receivable  by the  Executive  pursuant to this Section 4(b) shall be
reduced  to the  extent  that  comparable  benefits  equal in type and  level of
coverage are actually  received by the Executive  from, or made available to the
Executive  by, a  subsequent  employer  without  greater cost to him/her than as
provided  by the  Company  during such  24-month  period (and any such  benefits
received by or made available to the Executive  shall be reported to the Company
by the Executive).  In addition,  in the event that the Executive and/or his/her
dependents  are  ineligible  under  the terms of any of the  Company's  plans to
continue to be so covered, the Company shall provide to the Executive a lump sum
payment  (determined  on a present  value basis using the interest rate provided
for in  Section  1274(b)(2)(B)  of the  Internal  Revenue  Code  on the  Date of
Termination) in such amount, after taxes, that shall be equal to the cost to the
Executive of procuring such coverage for such period.

     (c) In the case of a Covered  Termination  during the Protected  Period (i)
any  unvested  amount  credited to  Executive's  bookkeeping  account  under the
Company's  Supplemental  Executive  Retirement  Plan as in  effect  on the  date
hereof,  and as the same may be amended prior to any Change of Control ("SERP"),
will become fully vested as of the Date of  Termination,  and in such event such
bookkeeping  account  shall be  increased as of the Date of  Termination  by the
aggregate amount of the unvested portion of any account maintained for Executive
under any of the Company's  "qualified"  retirement  plans as of the Executive's
date of termination of employment;  and (ii)  Executive's  SERP account shall be
distributed  to the  Executive  as  provided  under the terms of the SERP and in
accordance with Executive's distribution election then in effect.

     (d) In the case of a  Covered  Termination  during  the  Protected  Period,
notwithstanding  anything  contained  in the  Liz  Claiborne  Retirement  Income
Accumulation  Plan as in  effect  on the  date  hereof,  and as the  same may be
amended prior to any Change of Control (the "Accumulation Plan"), any unvested

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amount credited to Executive's  retirement income account under the Accumulation
Plan  will  become  fully  vested as of the Date of  Termination,  and (ii) such
account shall be distributed to the Executive as provided under the terms of the
Accumulation Plan.

     (e) In the case of a  Covered  Termination  during  the  Protected  Period,
notwithstanding anything to the contrary contained herein, all outstanding stock
options and restricted  share awards,  if any, granted to Executive under any of
the Company's  stock  incentive plans or other similar plans shall be subject to
the applicable  terms  (including  without  limitation,  except where  otherwise
specifically  provided  at  the  time  such  awards  were  granted,  as  to  the
accelerated vesting thereof under the terms of such plan) of the applicable plan
and award agreement or certificate.

     (f) In the case of a Covered  Termination  during the Protected Period, the
Company shall pay to the Executive all other amounts  vested,  accrued or earned
by the Executive  through the Date of Termination  and amounts  otherwise  owing
under the then  existing  plans and policies of the Company,  including  but not
limited  to  all  compensation  or  other  amounts  previously  deferred  by the
Executive  (together with any accrued interest  thereon) and not yet paid by the
Company and all amounts vested under the Accumulation Plan.

     (g) The  Company  shall pay to the  Executive  the amount due  pursuant  to
Section 4(a) in a lump sum cash payment as soon as practicable, but in any event
by the fifth (5th) business day following the Date of Termination.

5.   Notice of Termination and Date of Termination.

     (a)  During  the  Protected  Period,  any  termination  of the  Executive's
employment by the Executive for Good Reason or by the Company for Cause shall be
communicated  by  written  Notice  of  Termination  from the  party  terminating
employment  hereunder  to the other party hereto in  accordance  with Section 10
below.  For purposes of this Agreement,  a "Notice of Termination"  shall mean a
notice  given in good faith and with a  reasonable  belief  that Good  Reason or
Cause,  as the case may be, has  occurred,  which shall  indicate  the  specific
termination  provision  in this  Agreement  relied  upon and  shall set forth in
reasonable  detail  the facts and  circumstances  claimed to provide a basis for
termination of the

                                       10
<PAGE>   11

Executive's  employment  under  the  provision  so  indicated.   Any  Notice  of
Termination  must specify a Date of  Termination;  any Notice of Termination for
Cause shall include a copy of the relevant Cause Resolution.

     (b) For purposes of this Agreement, "Date of Termination" shall mean (i) in
the case of a termination  by the Company for Cause or by the Executive for Good
Reason,  the date specified as Executive's  last day of employment in the Notice
of  Termination,  which shall not be less than ten (10)  business days after the
date such Notice of  Termination  is deemed given in accordance  with Section 10
below,  or (ii) in any  other  case,  the last day  worked by the  Executive  as
reflected on the Company's payroll records.

6.   Tax Gross-Up; Potential Reduction in Severance Amount.

     (a) Anything in this Agreement to the contrary notwithstanding, but subject
to Section 6(h), in the event that a Covered  Termination shall occur during the
Protected  Period and it shall be determined  (as hereafter  provided)  that any
payment  (other than the  Gross-Up  payments  provided for in this Section 6) or
distribution by the Company or any of its  subsidiaries to or for the benefit of
the Executive,  whether paid or payable or distributed or distributable pursuant
to the terms of this Agreement or pursuant to any other agreement, policy, plan,
program or arrangement,  including  without  limitation any stock option,  stock
appreciation right or similar right,  restricted stock or deferred stock, or the
lapse or termination of any  restriction  on,  deferral period or the vesting or
exercisability  of any of the foregoing (a  "Payment"),  would be subject to the
excise tax imposed by Section  4999 of the  Internal  Revenue  Code of 1986,  as
amended Code") or any successor provision thereto, by reason of being considered
"contingent  on a change in  ownership  or control"  of the  Company  within the
meaning of Section 280G of the Code (or any successor  provision  thereto) or to
any similar tax imposed by state or local law, or any interest or penalties with
respect  to such tax (such tax or taxes,  together  with any such  interest  and
penalties,  being hereafter  collectively referred to as the "Excise Tax"), then
the  Executive  shall be entitled to receive an  additional  payment or payments
(collectively,  a "Gross-Up  Payment") as provided herein.  The Gross-Up Payment
shall be in an amount such that,  after  payment by the  Executive  of all taxes
(including any

                                       11
<PAGE>   12

interest or penalties imposed with respect to such taxes),  including any Excise
Tax and any  federal,  state or  local  income  tax  imposed  upon the  Gross-Up
Payment,  the Executive  retains an amount of the Gross-Up  Payment equal to the
Excise Tax imposed upon the Payment.

     (b) Subject to the  provisions  of Section 6(f) below,  all  determinations
required to be made under this  Section 6,  including  the  determination  as to
whether an Excise Tax is payable by the  Executive and the amount of such Excise
Tax and whether a Gross-Up  Payment is required to be paid by the Company to the
Executive and the amount of such Gross-Up  Payment,  if any,  shall be made by a
nationally  recognized  accounting firm (the "Accounting  Firm") selected by the
Executive in his sole discretion. The Executive shall direct the Accounting Firm
to submit its  determination  and detailed  supporting  calculations to both the
Company and the  Executive  within 30 calendar days after the date of the Change
in Control, the Date of Termination,  if applicable,  and any such other time or
times as may be requested  by the Company or the  Executive.  If the  Accounting
Firm  determines  that any Excise Tax is payable by the  Executive,  the Company
shall pay the required  Gross-Up  Payment to the Executive  within five business
days after receipt of such  determination  and calculations  with respect to any
Payment to the Executive.  If the Accounting  Firm determines that no Excise Tax
is  payable  by the  Executive,  it  shall,  at the same  time as it makes  such
determination,  furnish  the  Company  and the  Executive  an  opinion  that the
Executive has substantial authority not to report any Excise Tax on his federal,
state or local income or other tax return. As a result of the uncertainty in the
application of Section 4999 of the Code (or any successor provision thereto) and
the possibility of similar uncertainty  regarding  applicable state or local tax
law at the time of any  determination  by the Accounting Firm  hereunder,  it is
possible  that  Gross-Up  Payments  which will not have been made by the Company
should  have been made (an  "Underpayment"),  consistent  with the  calculations
required to be made hereunder.  In the event that the Company  exhausts or fails
to pursue  its  remedies  pursuant  to  Section  6(f)  below  and the  Executive
thereafter is required to make a payment of any Excise Tax, the Executive  shall
direct the Accounting Firm to determine the amount of the Underpayment  that has
occurred and to submit its determination and detailed supporting calculations to
both  the  Company  and  the  Executive  as  promptly  as  possible.   Any  such
Underpayment

                                       12
<PAGE>   13

shall be promptly  paid by the Company to, or for the benefit of, the  Executive
within  five  (5)  business  days  after  receipt  of  such   determination  and
calculations.

     (c) The Company and the Executive  shall each provide the  Accounting  Firm
access to and copies of any books,  records and  documents in the  possession of
the Company or the Executive,  as the case may be,  reasonably  requested by the
Accounting Firm, and otherwise  cooperate with the Accounting Firm in connection
with  the  preparation  and  issuance  of the  determinations  and  calculations
contemplated by Section 6(b) above. Any  determination by the Accounting Firm as
to the amount of the Gross-Up  Payment shall be binding upon the Company and the
Executive.

     (d) The federal,  state and local income or other tax returns  filed by the
Executive  shall  be  prepared  and  filed  on  a  consistent   basis  with  the
determination  of the Accounting  Firm with respect to the Excise Tax payable by
the  Executive.  The  Executive  shall make proper  payment of the amount of any
Excise Payment,  and at the request of the Company,  provide to the Company true
and correct copies (with any amendments) of his/her federal income tax return as
filed with the Internal  Revenue Service and  corresponding  state and local tax
returns,  if relevant,  as filed with the applicable taxing authority,  and such
other documents reasonably requested by the Company, evidencing such payment. If
prior  to  the  filing  of  the  Executive's   federal  income  tax  return,  or
corresponding  state or local tax  return,  if  relevant,  the  Accounting  Firm
determines  that the  amount of the  Gross-Up  Payment  should be  reduced,  the
Executive shall within five business days after receipt of the Accounting Firm's
determination pay to the Company the amount of such reduction.

     (e) The fees and  expenses  of the  Accounting  Firm  for its  services  in
connection with the determinations and calculations contemplated by Section 6(b)
above  shall be borne  solely  by the  Company.  If such fees and  expenses  are
initially paid by the Executive,  the Company shall  reimburse the Executive the
full  amount of such fees and  expenses  within  five (5)  business  days  after
receipt from the Executive of a statement  therefor and  reasonable  evidence of
the payment thereof.

     (f) The  Executive  shall notify the Company in writing of any claim by the
Internal  Revenue  Service or any other taxing  authority  that, if  successful,
would require the payment by the Company of a

                                       13
<PAGE>   14

Gross-Up Payment or any additional Gross-Up Payment.  Such notification shall be
given as promptly as practicable  but no later than ten (10) business days after
the Executive  actually  receives  notice of such claim and the Executive  shall
further  apprise  the  Company of the nature of such claim and the date on which
such claim is  requested  to be paid (in each case,  to the extent  known by the
Executive).  The Executive  shall not pay such claim prior to the earlier of (x)
the  expiration  of the thirty  (30)-calendar  day period  following the date on
which he gives such  notice to the  Company and (y) the date that any payment of
amount with respect to such claim is due. If the Company  notifies the Executive
in writing  prior to the  expiration  of such  period that it desires to contest
such claim, the Executive shall:

          (i) provide the Company  with any written  records or documents in his
          possession relating to such claim reasonably requested by the Company;

          (ii) take such action in connection  with contesting such claim as the
          Company  shall  reasonably  request  in  writing  from  time to  time,
          including  without  limitation  accepting  legal  representation  with
          respect  to such  claim by an  attorney  competent  in  respect of the
          subject matter and reasonably selected by the Company;

          (iii) cooperate with the Company in good faith in order effectively to
          contest such claim; and

          (iv) permit the Company to participate in any proceedings  relating to
          such claim;  provided,  however,  that the Company  shall bear and pay
          directly all costs and  expenses  (including  interest and  penalties)
          incurred in connection  with such contest and shall indemnify and hold
          harmless the  Executive,  on an after-tax  basis,  for and against any
          Excise  Tax or income  tax,  including  interest  and  penalties  with
          respect  thereto,  imposed as a result of such  contest and payment of
          costs and expenses.  Without limiting the foregoing provisions of this
          Section  6(f),  the Company  shall  control all  proceedings  taken in
          connection with the contest of any claim  contemplated by this Section
          6(f)  and,  at its sole  option,  may  pursue  or  forego  any and all
          administrative appeals, proceedings, hearings and conferences with the
          taxing authority in respect of such claim (provided, however, that the
          Executive may participate therein at his/her own cost and expense) and
          may, at its option, either direct the Executive to pay the tax claimed
          and sue for a refund or contest the claim in any  permissible  manner,
          and the Executive  agrees to prosecute such contest to a determination
          before any administrative tribunal, in a court of initial jurisdiction
          and in one or more appellate  courts,  as the Company shall determine;
          provided,  however,  that if the Company  directs the Executive to pay
          the tax claimed and sue for a refund,  the Company  shall  advance the
          amount of such payment to the Executive on an interest-free  basis and
          shall  indemnify  and hold the  Executive  harmless,  on an  after-tax
          basis, from any Excise Tax or income or other tax,  including interest
          or  penalties  with  respect  thereto,  imposed  with  respect to such
          advance;  and provided  further,  however,  that any  extension of the
          statute of  limitations  relating  to payment of taxes for the taxable
          year of the Executive  with respect to which the  contested  amount is
          claimed  to be  due  is  limited  solely  to  such  contested  amount.
          Furthermore,  the Company's  control of any such contested claim shall
          be limited to issues with respect to which a Gross-Up Payment would be
          payable hereunder and the Executive

                                       14
<PAGE>   15

          shall be entitled to settle or contest,  as the case may be, any other
          issue  raised by the  Internal  Revenue  Service  or any other  taxing
          authority.

     (g) If,  after the receipt by the  Executive  of an amount  advanced by the
Company pursuant to Section 6(f), the Executive receives any refund with respect
to such claim, the Executive shall (subject to the Company's  complying with the
requirements  of Section  6(f)) above  promptly pay to the Company the amount of
such refund (together with any interest paid or credited thereon after any taxes
applicable  thereto).  If,  after  the  receipt  by the  Executive  of an amount
advanced by the Company  pursuant to Section 6(f), a determination  is made that
the Executive shall not be entitled to any refund with respect to such claim and
the Company  does not notify the  Executive  in writing of its intent to contest
such denial or refund prior to the expiration of thirty (30) calendar days after
such  determination,  then  such  advance  shall be  forgiven  and  shall not be
required to be repaid and the amount of any such advance  shall  offset,  to the
extent  thereof,  the  amount of  Gross-Up  Payment  required  to be paid by the
Company to the Executive pursuant to this Section 6.

     (h) Notwithstanding any provision of this Agreement to the contrary, if but
for this sentence,  the Company would be obligated to make "parachute  payments"
to the Executive,  whether under this  Agreement,  the terms of any  stock-based
compensation  award or any other  agreement,  contract or  arrangement,  but the
aggregate  "present  value" of all such  parachute  payments does not exceed (x)
1.05 multiplied by (y) three (3) times the  Executive's  "base amount," then the
payments  and  benefits  to be paid or  provided  under this  Agreement  will be
reduced to the minimum  extent  necessary (but in no event to less than zero) so
that no  portion of the total  payments  or  benefits  due to the  Executive  on
account of a change in control of the Company,  determined  after the  reduction
under this Agreement, constitutes an "excess parachute payment." For purposes of
this Section 6(h), the terms "change in control,"  "excess  parachute  payment,"
"present  value,"  parachute  payment,"  and  "base  amount"  have the  meanings
assigned to them by Section 280G of the Code. The  determination  of whether any
reduction in such  payments or benefits to be provided  under this  Agreement is
required  pursuant to the  preceding  sentence will be made, if requested by the
Executive or the Company, at the expense of the Company by the

                                       15
<PAGE>   16

Company's  regular outside  accounting firm. The fact that the Executive's right
to payments or benefits may be reduced by reason of the limitations contained in
this Section 6(h) will not of itself limit or otherwise  affect any other rights
of the Executive  other than pursuant to this  Agreement.  In the event that any
payment or benefit  intended to be provided  under this Agreement is required to
be reduced  pursuant to this Section  6(h),  the  Executive  will be entitled to
designate the payments  and/or benefits to be so reduced in order to give effect
to  this  Section  6(h).  The  Company  will  provide  the  Executive  with  all
information  reasonably  requested by the  Executive to permit the  Executive to
make  such  designation.  In the  event  that the  Executive  fails to make such
designation  within ten (10) business days of the Termination  Date, the Company
may effect such  reduction  in any manner it deems  appropriate.  If,  despite a
reduction in payments  and/or  benefits in  accordance  with this Section  6(h),
Executive is required,  after notice to the Company pursuant to Section 6(f), to
pay an Excise Tax, Executive shall be paid a Gross-Up Payment in accordance with
Section 6(a),  but shall not be entitled to any additional  amounts  relating to
such reduction in payments and/or benefits,  notwithstanding  the failure of the
reduction to achieve the goal of avoiding an Excise Tax liability.

7.  No Mitigation Obligation or Permitted Offset. Executive will not be required
to mitigate the amount of any payment  provided for in this Agreement by seeking
other employment or otherwise,  nor will any profits,  income, earnings or other
benefits from any source whatsoever create any mitigation,  offset, reduction or
any other obligation on the part of the Executive hereunder or otherwise, except
as  expressly  provided in the  penultinate  sentence of Section 4(b) above with
respect  to  the  provision  of  comparable  welfare  benefits  by a  subsequent
employer.  The Company  shall not be  permitted  to reduce any  payment  owed to
Executive  under this  Agreement by any amount owed,  or allegedly  owed, to the
Company by the Executive.

8.   Arbitration; Payment of Legal Fees.

     (a) All claims by the Executive for payments and other  benefits under this
Agreement shall be in writing and directed to the Board. Any denial by the Board
of a claim for benefits under this Agreement shall be delivered to the Executive
in writing and shall set forth the specific reasons for the

                                       16
<PAGE>   17

denial and the specific  provisions  of this  Agreement  relied upon.  The Board
shall  afford a  reasonable  opportunity  to the  Executive  for a review of the
decision  denying a claim and shall further allow the Executive to appeal to the
Board any decision of the Board within sixty (60) days after notification by the
Board  that  the  Executive's  claim  has been  denied.  Any  dispute,  claim or
controversy  arising out of or relating to this  Agreement or the breach  hereof
shall be settled  by  arbitration  in the State,  City and County of New York in
accordance with the rules then obtaining of the American Arbitration Association
and  judgment  upon the  award  rendered  may be  entered  in any  court  having
jurisdiction  thereof.  The parties  hereto agree that any arbitral award may be
enforced  against  the  parties to an  arbitration  proceeding  or their  assets
wherever they may be found.

     (b) In the event of any dispute,  claim or controversy arising out of or in
connection with this Agreement,  including without limitation in connection with
Executive's  seeking to obtain or enforce any right or benefit  provided by this
Agreement,  if the Executive  prevails on any of the material issues involved in
any such dispute,  claim or controversy,  the Company shall pay to the Executive
immediately upon demand all reasonable  expenses  (including  without limitation
attorneys'  fees)  incurred by the Executive in connection  therewith.  Any such
reimbursement  shall  be in  addition  to the  Company's  obligations  to pay or
reimburse Executive's fees and expenses as provided in Section 6 above.

9.   Successors.

     (a) In addition to any obligation  imposed by law upon any successor to the
Company, the Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business  and/or  assets of the  Company,  by  agreement  in form and  substance
satisfactory  to the  Executive,  to assume  expressly and agree to perform this
Agreement  in the same manner and to the same  extent that the Company  would be
required to perform it if no such succession had taken place.

     (b) This Agreement  shall inure to the benefit of and be enforceable by the
Executive's  personal  or  legal  representatives,   executors,  administrators,
successors, heirs, distributees, devisees and legatees. If

                                       17
<PAGE>   18

the  Executive  dies while any amounts are payable to Executive  hereunder,  all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to his estate.

10.  Notices.

All notices or communications  required or permitted  hereunder will be given in
writing by personal delivery;  by confirmed facsimile  transmission;  by express
delivery  via  any  reputable  express  courier  service;  or by  registered  or
certified  mail,  return  receipt  requested,  postage  prepaid,  in  each  case
addressed to the parties at the respective  addresses set forth below or at such
other  address as may be  designated  in writing by either party to the other in
the manner set forth  herein.  Notices and  communications  which are  delivered
personally,  by confirmed  facsimile  transmission,  or by courier as aforesaid,
will be deemed  effectively  given on the date of delivery;  those  delivered by
mail as aforesaid will be deemed effectively given upon the fifth (5th) calendar
day subsequent to the postmark date thereof.

                           If to the Company:

                           Liz Claiborne, Inc.
                           1441 Broadway
                           New York, NY  10047
                           Attention:  Chief Executive Officer

                           with a copy to:

                           Liz Claiborne, Inc.
                           One Claiborne Avenue
                           North Bergen, NJ  07047
                           Attention:  General Counsel

                           If to the Executive:
                           At the address set forth opposite Executive's name
                           on the signature page hereof

11.  Governing Law.

This  Agreement  has been  made  and will be  governed  in all  respects  by the
internal laws of the State of Delaware  applicable  to contracts  made and to be
wholly  performed within such state (without regard to principles of conflict of
laws) and the parties  hereby  irrevocably  consent to the  jurisdiction  of the
federal and state  courts  sitting in the State of  Delaware  for the purpose of
enforcing this Agreement.

                                       18
<PAGE>   19

12.      Miscellaneous.

     (a) No provisions of this  Agreement may be modified,  waived or discharged
unless such waiver,  modification or discharge is agreed to in writing signed by
the Executive  and the Company.  No waiver by either party hereto at any time of
any breach by the other party hereto of, or  compliance  with,  any condition or
provision of this  Agreement to be performed by such other party shall be deemed
a waiver of similar or  dissimilar  provisions  or conditions at the same or any
prior or subsequent time.

     (b) This  Agreement,  taken  together with the provisions of any employment
agreement  or other  written  agreement  relating to  Executive,  sets forth the
entire  agreement by and between the Company and the  Executive  with respect to
the subject matter hereof .

     (c) Nothing expressed or implied in this Agreement will create any right or
duty on the part of the Company or the Executive to have the Executive remain in
the employment of the Company or any subsidiary prior to or following any Change
in Control.

     (d) The Company may withhold from any amounts  payable under this Agreement
all federal,  state,  city or other taxes as the Company is required to withhold
pursuant to any law or government regulation or ruling.

     (e) In the event  that the  Company  refuses or  otherwise  fails to make a
payment when due and it is ultimately  decided that the Executive is entitled to
such  payment,  such payment  shall be increased to reflect an interest  factor,
compounded  annually,  equal  to the  prime  rate in  effect  as of the date the
payment was first due plus five (5)  points.  For this  purpose,  the prime rate
shall be based on the rate  identified by Chase Manhattan Bank as its prime rate
in New York City.

     (f) The invalidity or  unenforceability of any provisions of this Agreement
shall not affect the validity or  enforceability  of any other provision of this
Agreement, which shall remain in full force and effect.

     (g) This  Agreement is personal in nature and neither of the parties hereto
shall,  without the consent of the other,  assign or transfer this  Agreement or
any rights or  obligations  hereunder,  except as  provided  in Section 9 above.
Without limiting the foregoing, the Executive's right to receive payments

                                       19
<PAGE>   20

hereunder shall not be assignable or transferable,  whether by pledge,  creation
of a security interest or otherwise, other than a transfer by his/her will or by
the  laws  of  descent  or  distribution,  and in  the  event  of any  attempted
assignment  or transfer by Executive  contrary to this Section 12(g) the Company
shall  have no  liability  to pay any  amount so  attempted  to be  assigned  or
transferred  to any person other than the  Executive or, in the event of his/her
death, his/her estate.

     (h) This  Agreement  may be executed in one or more  counterparts,  each of
which  shall  be  deemed  to be an  original  but  all of  which  together  will
constitute one and the same agreement.

     IN WITNESS  WHEREOF,  the parties have caused this Agreement to be executed
and delivered as of the day and year first above set forth.

                        LIZ CLAIBORNE, INC.

                        By: /s/ Michael Scarpa
                            ------------------
                            Michael Scarpa
                            Vice President-Finance and Chief Financial Officer

                        PAUL R. CHARRON

         :              /s/ Paul R. Charron
                        -------------------

                        Address: ***********************

                                 ***********************

                        Social Security Number: ***-**-****

                                       20

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