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                                                                    EXHIBIT 10.2

          THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
        REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
        SECURITIES LAWS OF ANY JURISDICTION. SUCH SECURITIES MAY NOT BE
             OFFERED, SOLD OR TRANSFERRED EXCEPT PURSUANT TO (I) A
         REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES THAT IS
        EFFECTIVE UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW, OR
            (II) ANY EXEMPTION FROM REGISTRATION UNDER SAID ACT, AND
        APPLICABLE STATE SECURITIES LAW, RELATING TO THE DISPOSITION OF
                                  SECURITIES.

                         THE TRANSFER OF THIS WARRANT IS
                         RESTRICTED AS DESCRIBED HEREIN.

                         PHILLIPS-VAN HEUSEN CORPORATION
               WARRANT FOR THE PURCHASE OF SHARES OF COMMON STOCK,
                            PAR VALUE $1.00 PER SHARE

No. W-1                                                          320,000 Shares

         THIS CERTIFIES that, for value received, Calvin Klein, as Trustee of
the Calvin Klein 2001 Revocable Trust, is entitled to subscribe for and purchase
from PHILLIPS-VAN HEUSEN CORPORATION, a Delaware corporation (the "Company"),
upon the terms and subject to the conditions contained herein, at any time or
from time to time after February 12, 2003 and before 5:00 P.M. Eastern Time on
February 12, 2012 (the "Exercise Period"), Three Hundred Twenty Thousand
(320,000) in the aggregate shares (subject to adjustment) of the Company's
common stock, par value $1.00 per share (including any other securities issuable
upon exercise hereof, the "Common Stock"), at a price per share equal to $28.00
(subject to the adjustment, the "Exercise Price"). This Warrant is the warrant
(collectively, including any warrants issued upon the exercise or transfer of
any such warrants in whole or in part, the "Warrants") issued pursuant to the
Stock Purchase Agreement, dated December 17, 2002 (the "Purchase Agreement"),
among the Company, Calvin Klein, and such other persons named therein. As used
herein, the term (i) "this Warrant" shall mean and include this Warrant and any
Warrant or Warrants hereafter issued as a consequence of the exercise or
transfer of this Warrant in whole or in part, (ii) "Holder" shall mean, Calvin
Klein, as Trustee of the Calvin Klein 2001 Revocable Trust and any other
individual or entity (each, a "person") who is or which becomes a registered
owner of any Warrant pursuant to the terms hereof. Neither this Warrant nor any
shares of Common Stock issued on exercise hereof (the "Warrant Shares") may be
sold or transferred except in accordance with the legend above.

         1. On the terms and subject to the conditions contained herein, this
Warrant may be exercised during the Exercise Period, as to the whole or any
lesser number of whole Warrant Shares, by the surrender of this Warrant (with
the form of election attached hereto duly executed) to the Company at its office
at 200 Madison Avenue, New York, New York 10016, or at such other place as is
designated in writing by the Company, together with, at the option of the
Holder, (i) a certified or bank cashier's check payable to the order of the
Company in an amount

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equal to the Exercise Price multiplied by the number of Warrant Shares for which
this Warrant is being exercised (the "Aggregate Exercise Price"), (ii) the
acceptance by the Holder of a number of Warrant Shares equal to (A) the number
of Warrant Shares subject to such exercise, less (B) the product of (1) such
number of Warrant Shares multiplied by (2) the quotient of (aa) the Exercise
Price divided by (bb) the Current Market Price, or (iii) any combination of the
foregoing. The "Current Market Price" of a Warrant Share shall be deemed to be
the closing price of a share of Common Stock as of the last trading day on the
principal stock exchange on which the Common Stock is then listed for trading
(or, if the Common Stock is not listed for trading on any stock exchange, the
highest reported bid price for the Common Stock as furnished by the National
Association of Securities Dealers, Inc. through Nasdaq or a similar organization
if Nasdaq is no longer reporting such information) immediately preceding the
date upon which the Warrant is delivered to the Company for exercise. The
closing price for any day shall be the last reported sales price regular way or,
in case no such reported sale takes place on such day, the average of the
closing bid and asked prices regular way, in either case on the principal stock
exchange on which the Common Stock is listed or admitted to trading or, if the
Common Stock is not listed or admitted to trading on any stock exchange, the
highest reported bid price for the Common Stock as furnished by the National
Association of Securities Dealers, Inc. through Nasdaq or a similar organization
if Nasdaq is no longer reporting such information. If on any such date the
Common Stock is not listed or admitted to trading on any stock exchange and is
not quoted by Nasdaq or any similar organization, the fair value of a share of
Common Stock on such date, as determined in good faith by the board of directors
of the Company, whose determination shall be conclusive absent manifest error,
shall be used.

         2. Upon each exercise of the Holder's rights to purchase Warrant
Shares, the Holder shall be deemed to be the holder of record of the Warrant
Shares issuable upon such exercise, notwithstanding that the transfer books of
the Company shall then be closed or certificates representing such Warrant
Shares shall not then have been actually delivered to the Holder. As soon as
practicable after each such exercise of this Warrant, the Company shall issue
and deliver (or cause its transfer agent to issue and deliver) to the Holder a
certificate or certificates for the Warrant Shares issuable upon such exercise,
registered in the name of the Holder or the Holder's designee. If this Warrant
should be exercised in part only, the Company shall, upon surrender of this
Warrant for cancellation, execute and deliver a new Warrant evidencing the right
of the Holder to purchase the balance of the Warrant Shares (or portions
thereof) subject to the terms hereof.

         3. Any Warrants issued upon the transfer or exercise in part of this
Warrant shall be numbered and shall be registered in a warrant register (the
"Warrant Register") as they are issued. The Company shall be entitled to treat
the registered Holder on the Warrant Register as the owner in fact thereof for
all purposes and shall not be bound to recognize any equitable or other claim to
or interest in such Warrant on the part of any other person, and shall not be
liable for any registration or transfer of Warrants which are registered or to
be registered in the name of a fiduciary or the nominee of a fiduciary unless
made with the actual knowledge that a fiduciary or nominee is committing a
breach of trust in requesting such registration or transfer, or with the
knowledge of such facts that its participation therein amounts to bad faith.
This Warrant shall be transferable only on the books of the Company upon
delivery thereof duly endorsed by the Holder or by his or its duly authorized
attorney or representative, or accompanied by proper evidence of succession,
assignment, or authority to transfer. In all cases of transfer by an

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attorney, executor, administrator, guardian, or other legal representative, duly
authenticated evidence of his or its authority shall be produced. Upon any
registration of transfer, the Company shall deliver a new Warrant or Warrants to
the person entitled thereto. This Warrant may be exchanged, at the option of the
Holder thereof, for another Warrant, or other Warrants of different
denominations, of like tenor and representing in the aggregate the right to
purchase a like number of Warrant Shares (or portions thereof), upon surrender
to the Company or its duly authorized agent. Notwithstanding the foregoing, the
Company shall have no obligation to cause Warrants to be transferred on its
books to any person if, in the opinion of counsel to the Company, such transfer
does not comply with the provisions of the Securities Act of 1933, as amended,
and the rules and regulations thereunder (the "Securities Act").

         4. The Company shall at all times reserve and keep available out of its
authorized and unissued Common Stock, solely for the purpose of providing for
the exercise of the rights to purchase all Warrant Shares granted pursuant to
the Warrants, such number of shares of Common Stock as shall, from time to time,
be sufficient therefor. The Company covenants that all shares of Common Stock
issuable upon exercise of this Warrant, upon receipt by the Company of the full
Exercise Price therefor, shall be validly issued, fully paid, nonassessable,
free and clear of all liens, security interests, charges and other similar
encumbrances, and free and clear of preemptive rights.

         5. (a) In case the Company shall at any time after the date the
Warrants were first issued (i) declare a dividend on the outstanding Common
Stock payable in shares of its capital stock, (ii) subdivide the outstanding
Common Stock into a greater number of shares, (iii) combine the outstanding
Common Stock into a smaller number of shares, or (iv) issue any shares of its
capital stock by reclassification of the Common Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing corporation), then, in each case, the number of
Warrant Shares, in effect immediately prior to the close of business on the
record date for the determination of stockholders entitled to receive such
dividend or to participate in such subdivision, contribution or reclassification
or, if no record date is selected or the fixing of a record date is
inapplicable, immediately prior to the effective time of such subdivision,
combination, or reclassification, shall be proportionately adjusted so that the
Holder of any Warrants exercised after such time shall be entitled to receive
the aggregate number and kind of shares which, if such Warrant had been
exercised immediately prior to such time, such Holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend, subdivision,
combination, or reclassification. In the event of any adjustment as provided for
in this Section 5(a), the Exercise Price shall be adjusted by multiplying the
Exercise Price in effect prior to such adjustment by a fraction, of which the
numerator shall be the number of Warrant Shares issuable upon exercise of this
Warrant immediately prior to such adjustment, and of which the denominator shall
be the number of shares into which such Warrant Shares shall have been adjusted
in accordance with this Section 5(a). Such adjustment shall be made successively
whenever any event listed above shall occur and shall take effect at the close
of business on the aforementioned record date or at the aforementioned effective
time, as the case may be. In the event that after fixing any such record date
any such dividend or other transaction is not effected, the Exercise Price and
the number of Warrant Shares shall be readjusted to the Exercise Price and the
number of Warrant Shares which would then have been in effect if such record
date had not been fixed.

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              (b) (i) If at any time or from time to time the Company issues
or sells, or is deemed by the express provisions of this subsection (i) to have
issued or sold, Additional Shares of Common Stock (as hereinafter defined),
other than as a dividend or other distribution on any class of stock, a
subdivision or combination of shares of Common Stock and other than in the case
of a reorganization, reclassification, merger, consolidation or disposition of
assets, in each case for which adjustment is provided in this Section 5(b), for
an Effective Price (as hereinafter defined) less than 95% of the then Current
Market Price per Share of Common Stock (or amends the terms of any outstanding
right, option, or convertible security for an exercise or conversion price below
95% of such Current Market Price per Share of Common Stock), then and in each
such case the Exercise Price shall be reduced, as of the opening of business on
the date of such issue or sale, to a price determined by multiplying the
Exercise Price existing immediately prior to such issuance by a fraction (x) the
numerator of which shall be (A) the number of shares of Common Stock deemed
outstanding (as defined below) immediately prior to such issue or sale, or
deemed issue or sale plus (B) the number of shares of Common Stock which the
aggregate consideration received (as defined in subsection (b)(ii)) by the
Company for the total number of Additional Shares of Common Stock so issued or
sold or deemed issued or sold would purchase at the Current Market Price per
Share of Common Stock existing immediately prior to such issuance, and (y) the
denominator of which shall be the number of shares of Common Stock deemed
outstanding (as defined below) immediately prior to such issue or sale plus the
total number of Additional Shares of Common Stock so issued or sold or deemed
issued or sold. Upon the occurrence of an event resulting in actions specified
in this Section 5(b), immediately following such an action, the number of
Warrant Shares will be increased, as of the opening of business on the date of
such issue or sale, or deemed issue or sale to a number of shares of Common
Stock, equal to (i) the product of (A) the number of Warrant Shares to which the
Holder is then entitled upon exercise of this Warrant multiplied by (B) the
quotient of (1) the Exercise Price existing immediately prior to such issue,
sale or deemed issue or sale divided by (2) the Exercise Price immediately
following such issue, sale or deemed issue or sale as determined by the above
formula in this Section 5(b)(i). For the purposes of this Section 5(b)(i), the
number of shares of Common Stock deemed to be outstanding as of a given date
shall be the sum of (A) the number of shares of Common Stock actually
outstanding and (B) the number of shares of Common Stock which would be obtained
upon the exercise or conversion of the Warrants, all other rights, options and
convertible securities outstanding as of the date issuance of this Warrant
(including but not limited to the Series B Convertible Preferred Stock, par
value $100 per share of the Company (the "Series B Stock")).

                   (ii) For the purpose of making any adjustment required under
this Section 5(b), the consideration received by the Company for any issue or
sale of securities shall (A) to the extent it consists of cash, be computed at
the gross purchase price thereof, (B) to the extent it consists of property
other than cash, be computed at the fair value of that property as determined in
good faith by the Board of Directors of the Company (the "Board of Directors"),
and (C) if Additional Shares of Common Stock, Convertible Securities (as
hereinafter defined) or rights or options to purchase either Additional Shares
of Common Stock or Convertible Securities are issued or sold together with other
stock or securities or other assets of the Company for a consideration which
covers both, be computed as the portion of the consideration so received that
may be reasonably determined in good faith by the Board of Directors to be
allocable to such Additional Shares of Common Stock, Convertible Securities or
rights or options.

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                   (iii) For the purpose of the adjustment required under this
Section 5(b), if the Company issues or sells any rights or options for the
purchase of, or stock or other securities convertible into, Additional Shares of
Common Stock (such convertible stock or securities being herein referred to as
"Convertible Securities") and if the Effective Price of such Additional Shares
of Common Stock is less than 95% of the Current Market Price per Share of Common
Stock, in each case the Company shall be deemed to have issued at the time of
the issuance of such rights or options or Convertible Securities the maximum
number of Additional Shares of Common Stock issuable upon exercise or conversion
thereof (assuming the satisfaction of any conditions to exercisability,
including without limitation, the passage of time, but without taking into
account potential antidilution adjustments) and to have received as
consideration for the issuance of such shares an amount equal to the total
amount of the consideration, if any, received by the Company for the issuance of
such rights or options or Convertible Securities, plus, in the case of such
rights or options, the minimum amounts of consideration, if any, payable to the
Company upon the exercise of such rights or options, plus, in the case of
Convertible Securities, the minimum amounts of consideration, if any, payable to
the Company (other than the cancellation of liabilities or obligations evidenced
by such Convertible Securities) upon the conversion thereof; provided that if in
the case of Convertible Securities the minimum amounts of such consideration
cannot be ascertained, but are a function of antidilution or similar protective
clauses, the Company shall be deemed to have received the minimum amounts of
consideration without reference to such clauses; provided further that if the
minimum amount of consideration payable to the Company upon the exercise or
conversion of rights, options or Convertible Securities is reduced over time or
on the occurrence or nonoccurrence of specified events other than by reason of
antidilution adjustments, the Effective Price shall be recalculated using the
figure to which such minimum amount of consideration is reduced; provided
further that if the minimum amount of consideration payable to the Company upon
the exercise or conversion of such rights, options or Convertible Securities is
subsequently increased, the Effective Price shall be again recalculated using
the increased minimum amount of consideration payable to the Company upon the
exercise or conversion of such rights, options or Convertible Securities. No
further adjustment of the Exercise Price, as adjusted upon the issuance of such
rights, options or Convertible Securities, shall be made as a result of the
actual issuance of Additional Shares of Common Stock on the exercise of any such
rights or options or the conversion of any such Convertible Securities. If any
such rights or options or the conversion privilege represented by any such
Convertible Securities shall expire without having been exercised, the Exercise
Price, as adjusted upon the issuance of such rights, options or Convertible
Securities, shall be readjusted to the Exercise Price which would have been in
effect had an adjustment been made on the basis that the only Additional Shares
of Common Stock so issued were the Additional Shares of Common Stock, if any,
actually issued or sold on the exercise of such rights or options or rights of
conversion of such Convertible Securities, and such Additional Shares of Common
Stock, if any, were issued or sold for the consideration actually received by
the Company upon such exercise, plus the consideration, if any, actually
received by the Company for the granting of all such rights or options, whether
or not exercised, plus the consideration received for issuing or selling the
Convertible Securities actually converted, plus the consideration, if any,
actually received by the Company (other than by cancellation of liabilities or
obligations evidenced by such Convertible Securities) on the conversion of such
Convertible Securities.

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                   (iv) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued by the Company or deemed to be issued pursuant to
this Section 5(b), whether or not subsequently reacquired or retired by the
Company, other than (1) shares of Common Stock issuable upon conversion of, or
distributions with respect to the Series B Stock; (2) shares of Common Stock
issuable upon the exercise of stock options or other awards made or denominated
in shares of Common Stock under any of the Company's stock plans including any
stock option, stock purchase, restricted stock or similar plan hereafter adopted
by the Board of Directors and, if required by applicable law or stock exchange
requirement, approved by the stockholders of the Company; and (3) shares of
Common Stock issued pursuant to an acquisition of a business (including, without
limitation, by way of an acquisition of capital stock) or the assets of a
business (which assets do not consist primarily of cash or cash equivalents)
approved by the Board of Directors. The "Effective Price" of Additional Shares
of Common Stock shall mean the quotient determined by dividing the total number
of Additional Shares of Common Stock issued or sold, or deemed to have been
issued or sold by the Company under this Section 5(b), into the aggregate
consideration received, or deemed to have been received by the Company for such
issue under this Section 5(b), for such Additional Shares of Common Stock.

                   (v) For purposes of this Section 5, "Market Price per Share
of Common Stock" shall be deemed to be the average closing prices of a share of
Common Stock on the principal stock exchange on which the Common Stock is then
listed for trading (or, if the Common Stock is not listed for trading on any
stock exchange, the average highest reported bid prices for the Common Stock as
furnished by the National Association of Securities Dealers, Inc. through Nasdaq
or a similar organization if Nasdaq is no longer reporting such information, for
the ten trading days prior to the date of such issue or sale of securities.

              (c) Whenever there shall be an adjustment as provided in this
Section 5, the Company shall promptly cause written notice thereof to be sent by
registered mail, postage prepaid, to the Holder, at the Holder's address as it
shall appear in the Warrant Register, which notice shall be accompanied by an
officer's certificate setting forth the number of Warrant Shares purchasable
upon the exercise of this Warrant and the Exercise Price after such adjustment
and setting forth a brief statement of the facts requiring such adjustment and
the computation thereof.

              (d) The Company shall not be required to issue fractions of shares
of Common Stock or other capital stock of the Company upon the exercise of this
Warrant. If any fraction of a share would be issuable on the exercise of this
Warrant (or specified portions thereof), the Company shall purchase such
fraction for an amount in cash equal to the same fraction of the Exercise Price
on the date of exercise of this Warrant.

         6. In case of any reclassification or change of the Warrant Shares
(including (i) any consolidation or merger of another corporation into the
Company in which the Company is the continuing corporation and in which there is
a reclassification or change (including a change to the right to receive cash or
other property) of the shares of Common Stock, and (ii) any change in the Common
Stock into two or more classes or series of shares) in respect of which an
adjustment has not been provided for under Section 5(a), the Holder shall have
the right to receive upon exercise of this Warrant following the consummation of
any such reclassification or change solely the kind and amount of shares of
stock and other securities, property, cash, or any

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combination thereof which would have been receivable upon such reclassification
or change by a holder of the number of shares of Common Stock for which this
Warrant might have been exercised immediately prior to such reclassification or
change and the provisions of this Warrant shall therefore be applicable in
relation to such other stock, securities or property. This Section 6 shall
similarly apply to successive reclassifications and changes of shares of Common
Stock and to successive consolidations or mergers.

         7. If at any time the Company shall declare a distribution to all
holders of its outstanding Common Stock (any evidence of indebtedness, cash,
assets, or securities, (other than cash dividends paid in the ordinary course of
business or distributions and dividends payable in shares of Common Stock), or
rights, options, or warrants to subscribe for or purchase Common Stock,
indebtedness, cash, securities or other assets or securities convertible into or
exchangeable for shares of Common Stock, indebtedness, cash, securities or other
assets collectively, the "Assets"), and, excluding those with respect to the
issuance of which an adjustment of the Exercise Price is provided pursuant to
Section 5(b) hereof, then, in each case, the Exercise Price in effect
immediately prior to the close of business on the record date for the
determination of stockholders entitled to receive such distributions shall be
reduced to a price determined by multiplying such Exercise Price by a fraction,

                   (i) the numerator of which shall be the Current Market Price
per Share of Common Stock in effect immediately prior to the close of business
on the record date for the determination of stockholders entitled to receive
such distribution less the fair market value of such Assets (as determined in
good faith by the Board of Directors) applicable to one share of Common Stock at
the time of the distribution, and

                   (ii) the denominator of which shall be such Current Market
Price per Share of Common Stock immediately prior to the close of business on
the record date for the determination of stockholders entitled to receive such
distribution.

         Upon the occurrence of an event resulting in actions specified in this
Section 7, immediately prior to the close of business on the record date for the
determination of stockholders entitled to receive such distribution, the number
of Warrant Shares will be increased to a number of shares of Common Stock, equal
to (i) the product of (A) the number of Warrant Shares to which the Holder is
then entitled multiplied by (B) the quotient of (1) the Exercise Price existing
immediately prior to the close of business on the record date for the
determination of stockholders entitled to receive such distribution divided by
(2) the Exercise Price immediately following the close of business on the record
date for the determination of stockholders entitled to receive such
distribution, as determined by the above formula in this Section 7.

         Any adjustment required by this Section 7 shall be made whenever any
such distribution is to be made, and shall become effective immediately prior to
the close of business on the record date for the determination of stockholders
entitled to receive such distribution.

         8. The issuance of any shares of Common Stock or other securities upon
the exercise of this Warrant, and the delivery of certificates or other
instruments representing such shares or other securities, in each case to the
Holder, shall be effected by the Company without

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the Company imposing any charges upon the Holder. Notwithstanding anything to
the contrary herein, the Company shall not be required to pay any tax or taxes
which may be payable in respect of any transfer of any Warrants or Warrant
Shares, and the Company shall not be required to issue or deliver such Warrants
or Warrant Shares unless or until the Holder or such other person requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid
or is not payable under law.

         9. The Exercise Price set forth above shall not be adjusted upward
except in the event of a combination of the outstanding shares of Common Stock
into a smaller number of shares of Common Stock or in the event of a
readjustment of the aforementioned Exercise Price.

         10. If the Company at any time after the date of this Warrant combines
the outstanding shares of Common Stock, the number of Warrant Shares shall be
proportionality decreased. Such change shall be effective at the close of
business on the date of such combination.

         11. Prior to the issuance of any of the Warrant Shares, the Company
shall use commercially reasonable efforts to secure the listing of such Warrant
Shares upon the primary national securities exchange or automated quotation
system, if any, upon which the shares of Common Stock are then listed (subject
to official notice of issuance upon exercise of this Warrant) and shall use
commercially reasonable efforts to maintain, so long as any other shares of
Common Stock shall be so listed, such listing of all of the Warrant Shares; and
the Company shall so list on each national securities exchange or automated
quotation system, and shall use commercially reasonable efforts to maintain such
listing of, any other shares of capital stock of the Company issuable upon the
exercise of this Warrant if and so long as any shares of the same class shall be
listed on such national securities exchange or automated quotation system.

         12. Upon (i) any taking by the Company of a record of the holders of
any class of securities (including the Series B Stock) for the purpose of
determining the holders thereof who are entitled to receive any dividend or
other distribution (other than a regularly paid annual cash dividend), or (ii)
the merger, reorganization or consolidation of the Company into or with another
corporation or other similar transaction or series of related transactions in
which more than 50% of the voting power of the Company is disposed of or an
exchange for property, rights or securities distributed to holders thereof by
the acquiring person, firm or other entity, or the sale of all or substantially
all the assets of the Company (the foregoing being referred to collectively as
an "Acquisition"), or other capital reorganization of the Company, any merger or
consolidation of the Company with or into, any other corporation, or any
liquidation, dissolution or winding up of the Company whether voluntary or
involuntary ("Liquidation") or any other action of the type or types requiring
an adjustment to the Exercise Price or the number of the Warrant Shares as set
forth herein, the Company shall mail to each Holder at least 20 days prior to
the record date specified therein in a notice specifying (A) the date on which
any such record is to be taken for the purpose of such dividend (other than a
regularly paid annual cash dividend) or distribution and a description of such
dividend (other than a regularly paid annual cash dividend) or distribution (B)
the date on which any such Acquisition, reorganization, reclassification,
transfer, consolidation, merger, Liquidation, or other action is expected to
become effective, (C) the date, if any, that is to be fixed as to when the
holders of record of

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Common Stock (or other securities) shall be entitled to exchange their shares of
Common Stock (or other securities) for securities or other property deliverable
upon such Acquisition, reorganization, reclassification, transfer, Liquidation,
or other action. Such notice shall also set forth such facts with respect
thereto as shall be reasonably necessary to indicate the effect of such action
(to the extent such effect may be known at the date of such notice) on the
Exercise Price and the number, kind, or class or shares or other securities or
property which shall be deliverable upon the occurrence of such action or
deliverable upon the exercise of this Warrant.

         13. In any case in which this Warrant shall require that an adjustment
in the Exercise Price be made effective as of the close of business on a record
date for a specified event, the Company may elect to defer until the occurrence
of such event, issuing to the Holder, if the Holder exercised this Warrant as of
or after the close of business on such record date, the shares of Common Stock,
if any, issuable upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; provided, however, that the Company shall deliver to
the Holder a due bill or other appropriate instrument evidencing the Holder's
right to receive additional shares upon the occurrence of the event requiring
adjustment.

         14. Upon issuance, the Warrant Shares may not be transferred without
registration under the Securities Act and applicable state securities laws
unless counsel to the Holder (which is reasonably acceptable to the Company)
shall provide to the Company a written opinion that such transfer may be
effected without such registration. Each certificate representing any of the
Warrant Shares shall bear legends in substantially the following form:

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
         ANY JURISDICTION. SUCH SECURITIES MAY NOT BE OFFERED, SOLD OR
         TRANSFERRED EXCEPT PURSUANT TO (I) A REGISTRATION STATEMENT WITH
         RESPECT TO SUCH SECURITIES THAT IS EFFECTIVE UNDER SAID ACT AND
         APPLICABLE STATE SECURITIES LAW, OR (II) ANY EXEMPTION FROM
         REGISTRATION UNDER SAID ACT, AND APPLICABLE STATE SECURITIES LAW,
         RELATING TO THE DISPOSITION OF SECURITIES.

The Company shall remove or cause its registrar and transfer agent to remove
such legend at the time such Warrant Shares are transferred pursuant to an
effective registration statement under the Securities Act or the opinion
provided for above is provided.

         15. Upon receipt by the Company of evidence satisfactory to the Company
of the loss, theft, or destruction of any Warrant and upon the surrender of any
Warrant, if mutilated, the Company shall execute and deliver to the Holder
thereof a new Warrant of like date, tenor, and denomination. It shall be a
condition to the Company's obligations under this Section 9 that the Holder
first delivers to the Company an indemnity in form and substance reasonably
acceptable to the Company and reimburses the Company for its reasonable expenses
incurred in connection with the issuance of such new Warrant.

         16. The Holder shall not have, solely on account of such status, any
rights of a stockholder of the Company, either at law or in equity.

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         17. If any single action would require adjustment of the Exercise Price
or the number of Warrant Shares purchasable upon the exercise of each Warrant
pursuant to more than one provision of this Warrant, only one adjustment shall
be made.

         18. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be mailed, postage prepaid, by certified
mail, return receipt requested or sent, postage, fees or charges prepaid, by
Federal Express, Express Mail or similar overnight delivery or courier service
or delivered (in person or by facsimile transmission) against receipt to the
party to whom it is to be given, if sent to the Company, at: 200 Madison Avenue,
New York, New York 10016, Attention: General Counsel; or if sent to the Holder,
at the Holder's address as it shall appear on the Warrant Register; or to such
other address as the receiving party shall have furnished to the sending party
in writing in accordance with the provisions of this Section 11. Any notice or
other communication given pursuant to this Section 11 shall be deemed given at
the time of receipt thereof.

         19. Any purported transfer in violation of any provision of this
Warrant and all actions by the purported transferor and transferee in connection
therewith shall be of no force or effect, and the Company shall not be required
to recognize such purported transfer for any purpose, including without
limitation, for exercise.

         20. This Warrant shall be binding upon the Company and its successors
and assigns including by way of merger, consolidation or sale of the assets and
shall inure to the benefit of the Holder and the Holder's permitted successors
and assigns.

         21. This Warrant shall be governed by, and construed and enforced in
accordance with the laws of the State of New York applicable to contracts made
and performed within such State, without regard to principles of conflicts of
law.

         22. The Company and, by its acceptance of this Warrant, the Holder
irrevocably and unconditionally submit to the exclusive jurisdiction of the
United States District Court for the Southern District of New York or, if such
court will not accept jurisdiction, the Supreme Court of the State of New York,
New York County or any court of competent civil jurisdiction sitting in New York
County, New York. In any action, suit or other proceeding, the Company and, by
its acceptance of this Warrant, the Holder irrevocably and unconditionally waive
and agree not to assert by way of motion, as a defense or otherwise any claim
that it is not subject to the jurisdiction of the above courts, that such action
or suit is brought in an inconvenient forum or that the venue of such action,
suit or other proceeding is improper. The Company and, by its acceptance of this
Warrant, the Holder also agree that any final and unappealable judgment against
either of them in connection with any action, suit or other proceeding shall be
conclusive and binding on such party and that such award or judgment may be
enforced in any court of competent jurisdiction, either within or outside of the
United States. A certified or exemplified copy of such award or judgment shall
be conclusive evidence of the fact and amount of such award or judgment.

         23. THE COMPANY AND, BY ITS ACCEPTANCE OF THIS WARRANT, THE HOLDER
IRREVOCABLY WAIVES THE RIGHT TO A JURY TRIAL IN

                                       10
<PAGE>

CONNECTION WITH ANY LEGAL PROCEEDING RELATING TO THIS WARRANT OR THE ENFORCEMENT
OF ANY PROVISION OF THIS WARRANT.

         24. Each of the Company and, by its acceptance under this Warrant, the
Holder agree that in the event of any action with respect to the terms and
provisions of this Warrant, if the Holder prevails in such action then the
Holder shall be entitled to recovery of the Holder's reasonable attorney's fees
from the Company, and if the Company prevails in such action the Company shall
be entitled to recovery of its reasonable attorney's fees from the Holder.

         25. The Company shall maintain, at the principal office of the Company
(or such other office as it may designate by notice to the holder hereof), a
register for the Warrants in which the Company shall record the name and address
of the person in whose name a Warrant has been issued, as well as the name and
address of the person in whose name a Warrant has been issued, as well as the
name and address of each transferee and each prior owner of such Warrant.

         26. The Company shall not amend its Certificate of Incorporation or
participate in any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, for the
purpose of avoiding or seeking to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Company.

         27. This Warrant or any provisions hereof may be changed, waived,
discharged or terminated only by a statement in writing signed by the Company
and by the Warrant Holder.

         28. This Warrant shall not entitle the Holder hereof to any voting
rights or other rights as a shareholder of the Company prior to the exercise of
the Warrant, provided that nothing herein shall be construed to limit or impair
other rights that the Warrant Holder may have under this Warrant or otherwise.
No provision of this Warrants, in the absence of affirmative action by the
Holder hereof to purchase the shares, and no mere enumeration herein of the
rights or privileges of the Holder hereof, shall give rise to any liability or
such Holder for the Exercise Price or as a shareholder of the Company, whether
such liability is asserted by the Company or by creditors of the Company.

                                       11
<PAGE>

         IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by a duly authorized officer under its corporate seal and attested by
its Secretary on the day and year first written below.

Dated:     February 12, 2003

                         PHILLIPS-VAN HEUSEN CORPORATION

                         By:   /s/ Mark D. Fischer
                              --------------------------
                         Name: Mark D. Fischer
                         Title: Vice President, General Counsel and Secretary

                                       12
<PAGE>

                               FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires to transfer the
attached Warrant and such transfer is permissible under the terms of the
attached Warrant.)

         FOR VALUE RECEIVED, ________________________ hereby sells, assigns, and

transfers unto _________________ a Warrant to purchase __________ shares of

Common Stock, par value $1.00 per share, of Phillips-Van Heusen Corporation (the

"Company"), together with all right, title, and interest therein, and does

hereby irrevocably constitute and appoint ___________ attorney to transfer such

Warrant on the books of the Company, with full power of substitution.

Dated: ________________

                                          Signature_____________________________

                                     NOTICE

         The signature on the foregoing Assignment must correspond to the name

as written upon the face of this Warrant in every particular, without alteration

or enlargement or any change whatsoever.

                                       13
<PAGE>

To:      Phillips-Van Heusen Corporation.
         200 Madison Avenue
         New York, New York  10016
         Attention:  General Counsel

                              ELECTION TO EXERCISE

         The undersigned hereby irrevocably exercises his or its rights to
purchase _______ Warrant Shares covered by the within Warrant and tenders
payment herewith in the amount of $__________ in accordance with the terms
thereof, and requests that certificates for such securities be issued in the
name of, and delivered to:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
                    (Print Name, Address and Social Security
                          or Tax Identification Number)

and, if such number of Warrant Shares shall not be all the Warrant Shares
covered by the within Warrant, that a new Warrant for the balance of the Warrant
Shares covered by the within Warrant be registered in the name of, and delivered
to, the undersigned at the address stated below.

Dated:                                 Name:
      -------------------------              ----------------------------------
                                                           (Print)

Address:  ----------------------------------------------------------------------

                                       ----------------------------------------
                                                       (Signature)

The above signature must correspond to the name as written upon the face of the
within Warrant in every particular, without alteration or enlargement or any
change whatsoever.

                                       14<PAGE>

                                                                    EXHIBIT 10.3

                               TERM LOAN AGREEMENT

         This Term Loan Agreement ("Agreement"), is made as of the 16th day of
December, 2002, by and between PHILLIPS-VAN HEUSEN CORPORATION, a Delaware
corporation (the "Borrower"), each of the lenders executing a signature page
hereto (each a "Lender" and collectively, the "Lenders"), and APAX MANAGERS,
INC., a New York corporation, as administrative agent (the "Administrative
Agent") for the Lenders.

                                R E C I T A L S:
                                - - - - - - - -

         WHEREAS, pursuant to a Securities Purchase Agreement dated as of the
date hereof (the "Securities Purchase Agreement") among the Borrower and the
investors party thereto (the "Investors"), the Borrower has agreed to issue and
sell to the Investors 10,000 shares of the Borrower's Series B Convertible
Preferred Stock, $100.00 par value per share ("Series B Preferred Stock"), for
an aggregate purchase price of $250,000,000 (capitalized terms used herein and
not otherwise defined herein shall have the respective meanings set forth in the
Securities Purchase Agreement);

         WHEREAS, pursuant to the Securities Purchase Agreement, the proceeds of
the sale of Series B Preferred Stock to the Investors shall be applied to pay a
portion of the purchase price for the Borrower's acquisition of the Capital
Stock of the CK Companies and pay the fees and out-of-pocket expenses relating
to the Contemplated Transactions ("Transaction Costs");

         WHEREAS, in order to enable the Borrower to pay an additional portion
of the purchase price for the Capital Stock of the CK Companies and related
Transaction Costs, the Borrower has requested that the Lenders provide a bridge
loan to the Borrower in the aggregate amount of One Hundred Twenty Five Million
Dollars ($125,000,000), said bridge loan to be refinanced on a best efforts
expedited basis as provided herein; and

         WHEREAS, the Lenders are willing to make such an advance on the terms
and subject to the conditions set forth herein.

         NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and undertakings hereunder and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged,
intending to be legally bound, the parties hereto do hereby agree as follows:

1.       DEFINITIONS

         The following terms used herein have the meanings given them below:

         1.1 "Agreement" shall mean this Agreement as amended from time to time
in accordance with the terms hereof.

<PAGE>

         1.2 "Asset Sale" means the sale by the Borrower or any of its
Subsidiaries to any Person other than the Borrower or any of its wholly-owned
Subsidiaries of (i) any of the equity ownership of any of the Borrower's
Subsidiaries, (ii) substantially all of the assets of any division or line of
business of the Borrower or any of its Subsidiaries, or (iii) any other assets
(whether tangible or intangible) of the Borrower or any of its Subsidiaries.

         1.3 "Capital Expenditures" shall mean all expenditures for the
acquisition or leasing (pursuant to a capital lease) of assets or additions to
equipment (including replacements, capitalized repairs and improvements) which
should be capitalized under GAAP.

         1.4 "Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

         1.5 "Casualty Event" shall mean, with respect to any property of the
Borrower or any of its Subsidiaries, any loss of title with respect to such
property or any loss or damage to or destruction of, or any condemnation or
other taking (including by any Governmental Body) of, such property or any
interruption of the business of the Borrower or any Subsidiary which is covered
by business interruption insurance.

         1.6 "Change in Control" means (a) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as currently in effect) is or becomes the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, of more than 30% of the total ordinary voting power of the capital
stock of the Borrower other than the sale of the Series B Preferred Stock as
provided for in the Securities Purchase Agreement, (b) occupation of a majority
of the seats on the Board of Directors of the Borrower by Persons who were
neither (i) nominated by the Board of Directors of the Borrower nor (ii)
appointed by directors so nominated, (c) the occurrence of any change in control
or similar event (however denominated) with respect to the Borrower under and as
defined in the Subordinated Debt Documents or any other indenture or agreement
in respect of Material Indebtedness to which the Borrower or a Subsidiary is a
party or (d) the acquisition of direct or indirect Control of the Borrower by
any Person or group.

         1.7 "Closing Date" shall mean the Closing Date under the Securities
Purchase Agreement.

         1.8 "Code" shall mean the Uniform Commercial Code as the same may be in
effect from time to time in the State of New York; provided that if, by reason
of applicable law, the validity or perfection or the effect of perfection or
non-perfection or the priority of any security interest in any Collateral
granted under the Loan Documents is governed by the Uniform Commercial Code as
in effect in a jurisdiction other than New York, then as to the validity or
perfection or the effect of perfection or non-perfection or the priority, as the
case may be, of such

<PAGE>

security interest, "Uniform Commercial Code" shall mean the Uniform Commercial
Code as in effect in such other jurisdiction.

         1.9 "Collateral" shall have the meaning set forth in the Pledge and
Security Agreement.

         1.10 "Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.

         1.11 "Credit Facility Amendment" shall mean the First Amendment and
Waiver Agreement dated as of December 13, 2002 to the Credit Facility
substantially in the form attached hereto as Exhibit A.

         1.12 "Credit Facility Documents" shall mean the Financing Documents (as
defined in the Credit Facility).

         1.13 "Debentures" means the 7-3/4% Debentures Due 2023 of the Borrower
issued under the Debentures Indenture.

         1.14 "Debentures Indenture" means the Indenture dated as of November 1,
1993, by and between the Borrower and The Bank of New York, as Trustee,
governing the Debentures.

         1.15 "Default" means any event or condition that constitutes an Event
of Default or that upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.

         1.16 "Design Services Purchase Payments" shall have the meaning set
forth in the CK Purchase Agreement and shall include, without limitation, any
liquidated damages payable with respect thereto pursuant to the CK Purchase
Agreement.

         1.17 "Default Rate" shall have the meaning set forth in Section 2.2(b).

         1.18 "ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Company Employee Plan (other than an event for which the 30-day notice period is
waived); (b) the existence with respect to any Company Employee Plan of an
"accumulated funding deficiency" (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section
412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of
the minimum funding standard with respect to any Company Employee Plan; (d) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Company Employee Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Company
Employee Plan or to appoint a trustee to administer any Company Employee Plan;
(f) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability

<PAGE>

with respect to the withdrawal or partial withdrawal from any Company Employee
Plan or Multiemployer Plan (as defined in Section 4001(a)(3) of ERISA); or (g)
the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt
by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any
notice, concerning the imposition of liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.

         1.19 "Event of Default" shall have the meaning set forth in Section
7.1.

         1.20 "Final Maturity Date" shall mean the second anniversary of the
Closing Date.

         1.21 "Financial Officer" means the chief executive officer, president,
chief financial officer, principal accounting officer, treasurer, assistant
treasurer, controller or assistant controller of the Borrower.

         1.22 "Guarantee" shall mean the guarantee by CKI and those other
domestic CK Companies party thereto as Guarantors in favor of the Lenders,
substantially in the form attached hereto as Exhibit A.

         1.23 "Guarantor" shall have the meaning set forth in the Guarantee.

         1.24 "Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.

         1.25 "Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
under which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (g) all obligations, contingent or otherwise
by such Person guaranteeing or having the economic effect of guaranteeing
Indebtedness of others, directly or indirectly, (h) all Capital Lease
Obligations of such Person, (i) all obligations, contingent or otherwise, of
such Person as an account party in respect of letters of credit and letters of
guaranty and (j) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances and (k) every obligation of such Person under
any forward contract, futures contract, swap, option, caps, floors, collars and
similar agreements, the value of which is dependant upon interest rates,
currency or exchange rates or valuations. The Indebtedness of any Person shall
include the Indebtedness of any other entity (including any partnership in which
such Person is a general

<PAGE>

partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness provide that such Person is not liable
therefor.

         1.26 "Initial Maturity Date" shall mean the Business Day immediately
preceding the first anniversary of the Closing Date.

         1.27 "Intercreditor and Subordination Agreement" shall mean the
Intercreditor and Subordination Agreement among the Administrative Agent, the
agent to the lenders to the Credit Facility and Calvin Klein, substantially in
the form attached hereto as Exhibit C.

         1.28 "Interest" shall have the meaning set forth in Section 2.2(a).

         1.29 "Interest Payment Date" shall have the meaning set forth in
Section 2.2(a).

         1.30 "Lenders" shall have the meaning set forth in the preamble.

         1.31 "Loan" shall have the meaning set forth in Section 2.1.

         1.32 "Loan Documents" shall mean this Agreement, the Notes, the Pledge
and Security Agreement, the Intercreditor and Subordination Agreement, the CK
Intercreditor Agreement, the Credit Facility Amendment, the Guarantee and any
certificate or other document delivered by or on behalf of the Borrower or the
Lenders pursuant to any of the forgoing or in connection with the transactions
contemplated by this Agreement.

         1.33 "Material Adverse Effect" means a material adverse effect on (a)
the business, assets, operations, properties, prospects or condition (financial
or otherwise), contingent liabilities or material agreements of the Borrower and
its Subsidiaries taken as a whole, (b) the ability of the Borrower or any
Guarantor to perform any of its obligations under this Agreement and the other
Loan Documents, taken as a whole, (c) the rights of or benefits available to the
Lenders or the Administrative Agent under this Agreement and the other Loan
Documents, taken as a whole, or (d) the Administrative Agent's Lien on any
material portion of the Collateral or the priority of such Lien.

         1.34 "Material Indebtedness" means Indebtedness (other than the Loan),
or obligations in respect of one or more Hedging Agreements, of any one or more
of the Borrower and the Subsidiaries in an outstanding aggregate principal
amount exceeding $10,000,000. For purposes of determining Material Indebtedness,
the "principal amount" of the obligations of the Borrower or any Subsidiary in
respect of any Hedging Agreement at any time shall be the maximum aggregate
amount (giving effect to any netting agreements) that the Borrower or such
Subsidiary would be required to pay if such Hedging Agreement were terminated at
such time.

         1.35 "Net Proceeds" means (a) with respect to the sale or other
disposition of any asset the excess, if any, of (i) the aggregate amount
received in cash (including any cash received by way of deferred payment
pursuant to a note receivable, other non-cash consideration or otherwise, but
only as and when such cash is so received) in connection with such sale or other

<PAGE>

disposition, over (ii) the sum of (A) the amount of any Indebtedness which is
secured by any such asset or which is required to be, and is, repaid in
connection with the sale or other disposition thereof (other than Indebtedness
hereunder), (B) the reasonable out-of-pocket expenses and fees incurred with
respect to legal, investment banking, brokerage, advisor and accounting and
other professional fees, sales commissions and disbursements and all other
reasonable fees, expenses and charges, in each case actually incurred in
connection with such sale or disposition, (C) all income and transfer taxes
payable in connection with such sale or other disposition, whether actually paid
or estimated to be payable in cash in connection with such disposition or the
payment of dividends or the making of other distributions of the proceeds
thereof and (D) reserves, required to be established in accordance with GAAP or
the definitive agreements relating to such disposition, with respect to such
disposition, including pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations; (b) with respect to the issuance, sale or other
disposition of any stock or debt securities the excess of (i) the aggregate
amount received in cash (including any cash received by way of deferred payment
pursuant to a note receivable, other non-cash consideration or otherwise, but
only as and when such cash is so received) in connection with such issuance,
sale or other disposition, over (ii) the sum of (A) the reasonable fees,
commissions, discounts and other out-of-pocket expenses including related legal,
investment banking and accounting fees and disbursements incurred in connection
with such issuance, sale or other disposition, and (B) all income and transfer
taxes payable in connection with such issuance, sale or other disposition,
whether payable at such time or thereafter; and (c) with respect to a Casualty
Event, the aggregate amount of proceeds received with respect to such Casualty
Event, over the sum of (i) the reasonable expenses incurred in connection
therewith, (ii) the amount of any Indebtedness (other than Indebtedness
hereunder) secured by any asset affected thereby and required to be, and in
fact, repaid in connection therewith and (iii) all income and transfer taxes
payable, whether actually paid or estimated to be payable, in connection
therewith.

         1.36 "Net Securities Proceeds" shall have the meaning set forth in
Section 2.5(b).

         1.37 "Notes" shall mean the promissory notes made by Borrower to the
Lenders as evidence of the Loan, substantially in the form attached hereto as
Exhibit D.

         1.38 "Obligations" shall mean all of Borrower's liabilities,
obligations, and indebtedness to the Lenders of any and every kind and nature,
whether now existing or hereafter arising, under this Agreement or any of the
Loan Documents.

         1.39 "Permitted Encumbrances" means:

              (a) Liens imposed by law for taxes that are not yet due or are
being contested in compliance with Section 5.8;

              (b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary course
of business and securing

<PAGE>

obligations that are not overdue by more than 30 days or are being contested in
compliance with Section 5.8 and (ii) landlord's Liens arising by operation of
law;

              (c) pledges and deposits made in the ordinary course of business
in compliance with workers' compensation, unemployment insurance and other
social security laws or regulations or letters of credit or guarantees issued in
respect thereof,

              (d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business or letters of credit or guarantees issued in respect thereof;

              (e) judgment liens in respect of judgments that do not constitute
an Event of Default under clause (j) of Article VII;

              (f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;

              (g) Liens arising from UCC financing statements in respect of
leases permitted by this Agreement;

              (h) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods so long as such Liens attach only to the imported goods;
and

              (i) Liens in favor of vendors of goods arising as a matter of law
securing the payment of the purchase price therefor so long as such Liens attach
only to the purchased goods.

provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.

         1.40 "Permitted Investments" means:

              (a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within one year from the date of acquisition thereof,

              (b) investments in commercial paper maturing within 270 days from
the date of acquisition thereof and having, at such date of acquisition, the
highest credit rating obtainable from Standard & Poor's or from Moody's
Investors Service, Inc.;

              (c) investments in certificates of deposit, banker's acceptances
and time deposits maturing within 180 days from the date of acquisition thereof
issued or guaranteed by or

<PAGE>

placed with, and money market deposit accounts issued or offered by, any
domestic office of any commercial bank organized under the laws of the United
States of America or any State thereof which has a combined capital and surplus
and undivided profits of not less than $500,000,000;

              (d) investments in money market mutual funds having portfolio
assets in excess of $2,000,000,000 that comply with the criteria set forth in
Securities and Exchange Commission Rule 2a-7 under the Investment Company Act of
1940 and are rated AAA by Standard & Poor's and Aaa by Moody's Investors
Service, Inc.;

              (e) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and entered into
with a financial institution satisfying the criteria described in clause (c)
above;

              (f) securities with maturities of one year or less from the date
of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or any political subdivision or
taxing authority thereof, and rated at least A by Standard & Poor's or Moody's
Investors Service, Inc.; and

              (g) with respect to any Person organized or conducting operations
outside of the United States, investments denominated in the currency of the
jurisdiction in which such Person is organized or conducting business which are
similar to the items specified in clauses (a) through (f) above (other than the
nationality of the governmental or non-governmental issuer or counterparty
involved).

         1.41 "Pledge and Security Agreement" shall mean the pledge and security
agreement made by the Borrower in favor of the Lenders, substantially in the
form attached hereto as Exhibit E.

         1.42 "Requisite Lenders" has the meaning set forth in Section 8.3.

         1.43 "Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower or any Subsidiary, or any payment
(whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancelation or termination of any such shares of capital stock of
the Borrower or any Subsidiary or any option, warrant or other right to acquire
any such shares of capital stock of the Borrower or any Subsidiary.

         1.44 "Subordinated Debt" means (a) the unsecured subordinated notes
issued by the Borrower on April 28, 1998 in the aggregate principal amount of
$150,000,000 and (b) the Indebtedness represented thereby.

         1.45 "Subordinated Debt Documents" means the indenture under which the
Subordinated Debt is issued and all other instruments, agreements and other
documents

<PAGE>

evidencing or governing the Subordinated Debt or providing for any Guarantee or
other right in respect thereof.

         1.46 "Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.

         1.47 "Securities Purchase Agreement" shall have the meaning set forth
in the recitals hereto.

         1.48 "Transaction Costs" shall have the meaning set forth in the
recitals hereto.

         1.49 Accounting Terms. Any accounting terms used in this Agreement
which are not specifically defined herein shall have the meanings customarily
given them in accordance with GAAP.

2.       THE INDEBTEDNESS

         2.1 Commitment. Subject to the terms and conditions of this Agreement,
the Lenders hereby agree to provide a bridge loan to Borrower on the Closing
Date, in the form of a term loan, in the aggregate principal amount of One
Hundred Twenty Five Million Dollars ($125,000,000) (the "Loan"). The amount of
the Loan to be advanced by each Lender and the principal amount of the Note to
be issued to such Lender upon the Closing Date shall be as set forth on Schedule
2.1. The Loan is subject to refinancing on a best efforts expedited basis as
provided herein.

         2.2 Interest.

              (a) Interest on the outstanding principal amount of the Loan
("Interest") shall accrue from and including the Closing Date at the rate of 10%
per annum through and until the Initial Maturity Date and, if the Borrower
elects to extend the term of the Loan as provided in Section 2.3, thereafter at
the rate of 15% per annum until the Final Maturity Date. Interest shall be paid
quarterly in arrears on each March 31, June 30, September 30 and December 31 of
each year (each, an "Interest Payment Date") or, if any such date shall not be a
Business Day, on the next succeeding Business Day to occur after such date,
beginning on the first Interest Payment Date to occur after the Closing Date.
Interest shall be computed on the basis of a 360-day year of twelve 30-day
months.

              (b) Default Rate of Interest. Notwithstanding the foregoing
provisions of Section 2.2(a), but subject to applicable law, any overdue
principal of and overdue Interest on the Loan shall bear interest, payable on
demand in immediately available funds, for each day from

<PAGE>

the date payment thereof was due to the date of actual payment, at a rate equal
to 19% per annum (such sum being referred to herein as the "Default Rate"). Upon
and during the occurrence of an Event of Default (as hereinafter defined), the
Loan shall bear interest at the Default Rate, from the date of the occurrence of
such Event of Default until such Event of Default is cured or waived.

              (c) No Usurious Interest. In the event that any interest rate(s)
provided for in this Section 2.2, shall be determined to be unlawful, such
interest rate(s) shall be computed at the highest rate permitted by applicable
law. Any payment by the Borrower of any interest amount in excess of that
permitted by law shall be considered a mistake, with the excess being applied to
the principal amount of the Loan without prepayment premium or penalty; if no
such principal amount is outstanding, such excess shall be returned to the
Borrower.

         2.3  Maturity.

              (a) Subject to the provisions of Section 2.3(b) hereof, the
principal amount of the Loan, together with all accrued and unpaid Interest,
shall be due and payable upon the Initial Maturity Date.

              (b) The Borrower, at its option, may elect to extend the term of
the Loan until the Final Maturity Date by (i) providing the Administrative Agent
irrevocable written notice of such election at least 30 days and not earlier
than 45 days prior to the Initial Maturity Date and (ii) paying the Lenders on
or before the Initial Maturity Date an extension fee of Four Million Dollars
($4,000,000), in the aggregate (the "Extension Fee"); such fee to be allocated
pro rata among the Lenders in proportion to the outstanding principal amount of
Notes held by the Lenders on the date of such payment.

         2.4 Payment Procedure. All payments by Borrower of principal of, or
Interest on, the Loan, the Extension Fee and all other amounts to be paid by the
Borrower hereunder shall be paid in cash by wire transfer of immediately
available funds, without setoff, deduction or counterclaim on the date specified
for payment under this Agreement not later than 11:00 a.m. (New York City time)
to one or more accounts at one or more banks designated by the Administrative
Agent for the purpose on ten days prior written notice.

         2.5  Prepayment.

              (a) Optional Payment. All or a portion of the outstanding
principal amount of the Loan may , at the option of the Borrower, be prepaid
from time to time upon one days' prior written notice to the Administrative
Agent. No amount of the Loan that has been prepaid may be reborrowed by the
Borrower.

              (b) Mandatory Prepayment. The Loan shall be prepaid by the
Borrower in the amounts and under the circumstances set forth below:

<PAGE>

                   (i) No later than the first Business Day following the date
of receipt by the Borrower or any of its Subsidiaries of any Net Proceeds in
respect of any Asset Sale or Casualty Event, the Borrower shall prepay the Loan
in an amount equal to such Net Proceeds to the extent such Net Proceeds are not
required to be paid to the lenders under the Credit Facility or are permitted to
be reinvested by the Borrower under the Credit Facility; and

                   (ii) On the date of the receipt by the Borrower or any of its
Subsidiaries of the cash proceeds (any such proceeds net of underwriting
discounts and commissions and other reasonable costs and expenses associated
therewith being "Net Securities Proceeds"), from the issuance by the Borrower or
any of its Subsidiaries of any Securities of the Borrower or any of its
Subsidiaries after the Closing Date, the Borrower shall prepay the Loan in an
amount equal to such Net Securities Proceeds.

         2.6 Purpose of Loan. Proceeds of the Loan shall be available solely to
pay a portion of the purchase price for the Capital Stock of the CK Companies
and to pay Transaction Costs.

         2.7 Guarantee. The due and punctual payment of the principal amount of
and Interest on the Loan and all other amounts due to the Lenders under this
Agreement or the Notes shall be unconditionally guaranteed, jointly and
severally, by the Guarantors pursuant to the Guarantee.

         2.8 Pledge and Security Agreement. The Borrower's obligations under
this Agreement shall be secured by a first priority perfected security interest
in the Collateral pursuant to the Pledge and Security Agreement.

         2.9 Intercreditor and Subordination Agreement. The Borrower's
obligations under the Credit Facility shall be subordinated to the Borrower's
obligations under this Agreement to the extent set forth in the Subordination
and Intercreditor Agreement.

3.       REPRESENTATIONS AND WARRANTIES OF THE BORROWER

         The Borrower represents and warrants to each of the Lenders as follows:

         3.1 Authority; Binding Effect. The Borrower has full corporate power
and authority to execute and deliver this Agreement and the other Loan Documents
to which it is a party and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the other Loan
Documents to which the Borrower is a party and the consummation by the Borrower
of the transactions contemplated hereby and thereby have been duly and validly
approved by all necessary corporate action on the part of the Borrower. This
Agreement has been duly executed and delivered by the Borrower and constitutes
the legal, valid and binding obligation of the Borrower, enforceable in
accordance with its terms, except as such enforceability may be subject to the
effects of any applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar Laws affecting creditors' rights generally
and subject to the effects of general equitable principles. Each of the other
Loan Documents to which the Borrower is a party, when executed and delivered by
the Borrower, will have been duly executed and delivered by the Borrower and
will constitute legal, valid and binding

<PAGE>

obligations of the Borrower, enforceable in accordance with their respective
terms, except as such enforceability may be subject to the effects of any
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar Laws affecting creditors' rights generally and subject to
the effects of general equitable principles.

         3.2 Solvency. Immediately after the consummation of the Contemplated
Transactions to occur on the Closing Date and after giving effect to the
application of the proceeds of the Loan (a) the fair value of the assets of the
Borrower on a consolidated basis, at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (b) the present fair
saleable value of the property of the Borrower on a consolidated basis will be
greater than the amount that will be required to pay the probable liability of
its debts and other liabilities, subordinated, contingent or otherwise, as such
debts and other liabilities become absolute and matured; (c) the Borrower on a
consolidated basis will be able to pay its debts and liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and
matured; and (d) the Borrower on a consolidated basis will not have unreasonably
small capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted following the Closing
Date.

         3.3 Pledge and Security Agreement. The Pledge and Security Agreement is
effective to create in favor of the Administrative Agent, for the ratable
benefit of the Lenders, a legal, valid and enforceable security interest in the
Collateral and, when the Collateral is delivered to the Administrative Agent,
the Pledge and Security Agreement shall constitute a fully perfected first
priority Lien on, and security interest in, all right, title and interest of the
pledgor thereunder in such Collateral, in each case prior and superior in right
to any other person.

         3.4 Federal Reserve Regulations.

              (a) Neither the Borrower nor any of the Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of buying or carrying margin stock as defined in
Regulation U of the Board of Governors of the Federal Reserve Board.

              (b) No part of the proceeds of the Loan will be used, whether
directly or indirectly, and whether immediately, incidentally or ultimately, for
any purpose that entails a violation of, or that is inconsistent with, the
provisions of the regulations of the Board of Governors of the Federal Reserve
System, including Regulation T, U or X.

              (c) The Pledge of Collateral pursuant to the Pledge and Security
Agreement does not violate Regulation T, U or X of the Board of Governors of the
Federal Reserve System.

         3.5 Senior Indebtedness. The Obligations constitute "Senior Debt" under
and as defined in the Subordinated Debt Documents.

<PAGE>

         3.6 Additional Representations and Warranties. Each representation and
warranty of the Borrower set forth in Article III of the Securities Purchase
Agreement is deemed to be made herein.

4.       CONDITIONS

         The obligations of the Lenders to make the Loan pursuant to this
Agreement is subject to the satisfaction on or before the Closing Date of the
following conditions:

         4.1 The Borrower and each other party thereto shall have duly executed
(or caused to be executed) and delivered to the Administrative Agent each of the
following, in each case in the form attached hereto and dated as of the Closing
Date:

              (a) this Agreement;

              (b) the Notes;

              (c) the Pledge and Security Agreement;

              (d) the Intercreditor and Subordination Agreement and any
supplemental indenture necessary in order to authorize The Bank of New York, as
trustee under the Debentures Indenture, to execute the Intercreditor and
Subordination Agreement;

              (e) the Guarantee; and

              (f) the Credit Facility Amendment.

         4.2 The Borrower shall have furnished to the Administrative Agent (i)
copies of resolutions of the board of directors of Borrower authorizing the
execution, delivery and performance of this Agreement, the borrowing hereunder,
and the other Loan Documents to which it is a party, which shall have been
certified by the Secretary of the Borrower as being complete, accurate and in
effect and (ii) a certificate of the Secretary of the Borrower, as to the
incumbency and signatures of the officers of Borrower signing the Loan Documents
to which it is a party.

         4.3 Each Guarantor shall have furnished to the Administrative Agent (i)
copies of its certificate of incorporation and by-laws and copies of resolutions
of its board of directors authorizing the execution, delivery and performance of
the Guarantee, which in each case shall have been certified by its Secretary as
being complete, accurate and in effect, (ii) a certificate of its Secretary, as
to the incumbency and signatures of its officers signing the Guarantee and (iii)
certificates issued by the appropriate Governmental Body evidencing, as of a
recent date, the good standing and tax status of such Guarantor in the
jurisdiction in which it is incorporated and in those jurisdictions in which it
is qualified to do business.

         4.4 No Event of Default and no default under the Pledge and Security
Agreement or Guarantee shall have occurred.

<PAGE>

         4.5 Each of the conditions to the Investors obligations under the
Securities Purchase Agreement shall have been satisfied and Borrower shall
deliver to the Administrative Agent a certificate signed by the Borrower and
addressed to the Administrative Agent dated as of the Closing Date to the effect
that the statements set forth in this Section 4.5 and in Sections 3.2, 3.3, 3.4
and 3.5 are true and correct.

         4.6 The closing of the CK Acquisition shall occur substantially
simultaneously with the closing hereunder.

         4.7 Borrower shall have caused to be delivered to Administrative Agent
an opinion of Borrower's legal counsel addressed to the Lenders and the
Administrative Agent, substantially in the form attached hereto as Exhibit F.

         4.8 Borrower shall have delivered to Administrative Agent such other
instruments and documents (not inconsistent with the terms hereof) as
Administrative Agent may reasonably request in connection with the making of the
Advances hereunder, and all such instruments and documents shall be reasonably
satisfactory in form and substance to the Lenders and their counsel.

         4.9 All proceeding taken on or prior to the Closing Date in connection
with the Loan and the Contemplated Transactions shall be reasonably satisfactory
to the Lenders and their counsel.

5.       AFFIRMATIVE COVENANTS

         The Borrower covenants and agrees with the Lenders that, so long as any
Obligation remains outstanding:

         5.1 Information. The Borrower will furnish to the Administrative Agent
and each of the Lenders:

              (a) within 95 days after the end of each fiscal year, (i) a
consolidated balance sheet and consolidated income statement showing the
financial position of the Borrower and its subsidiaries as of the close of such
fiscal year and the results of their operations during such year, and (ii) a
consolidated statement of shareholders' equity and a consolidated statement of
cash flow, as of the close of such fiscal year, comparing such financial
position and results of operations to such financial condition and results of
operations for the comparable period during the immediately preceding fiscal
year, all the foregoing financial statements to be audited by Ernst & Young LLP
or other independent public accountants of recognized national standing selected
by the Borrower in compliance with applicable SEC rules and regulations (which
report shall not contain any going concern or similar qualification or exception
as to scope), as being fairly stated in relation to such audited financial
statements taken as a whole and together with management's discussion and
analysis presented to the management of the Borrower and its subsidiaries (the
Borrower being permitted to satisfy the requirements of this clause (a) by

<PAGE>

delivery of its annual report on Form 10-K (or any successor form), and all
supplements or amendments thereto, as filed with the SEC);

              (b) within 50 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, unaudited consolidated balance
sheets of the Borrower and its subsidiaries as of the end of such fiscal
quarter, together with the related consolidated statements of income for such
fiscal quarter and for the portion of the Borrower's fiscal year ended at the
end of such fiscal quarter and the related consolidated statements of cash flows
for the portion of the Borrower's fiscal year ended at the end of such fiscal
quarter, and in comparative form the corresponding financial information as at
the end of, and for, the corresponding fiscal quarter of the Borrower's prior
fiscal year and the portion of the Borrower's prior fiscal year ended at the end
of such corresponding fiscal quarter, in each case certified by a Financial
Officer as presenting fairly in all material respects the financial position and
results of operations and cash flow of the Borrower and its subsidiaries in
accordance with GAAP (except the absence of footnote disclosure), in each case
subject to normal year-end audit adjustments (the Borrower being permitted to
satisfy the requirements of this clause (b) by delivery of its quarterly report
on Form 10-Q (or any successor form), and all supplements or amendments thereto,
as filed with the SEC);

              (c) within 20 days after the end of each calendar month (other
than any such month that corresponds to the end of a fiscal quarter or fiscal
year of the Borrower), if the Borrower is then required to deliver such
documents under the Credit Facility, an unaudited consolidated balance sheet of
the Borrower and its subsidiaries as at the end of such month, together with the
related unaudited consolidated statement of income for such month and the
portion of the Borrower's fiscal year ended at the end of such month and the
related consolidated statements of cash flows for the portion of the Borrower's
fiscal year ended at the end of such month, setting forth in comparative form
the corresponding financial information as at the end of, and for, the
corresponding month of the Borrower's prior fiscal year and the portion of the
Borrower's prior fiscal year ended at the end of such corresponding month, in
each case certified by a Financial Officer as presenting fairly in all material
respects the financial position and results of operations and cash flows of the
Borrower and its subsidiaries as at the date of, and for the periods covered by,
such financial statements, in accordance with GAAP (except for the absence of
footnotes), in each case subject to normal year-end audit adjustments;

              (d) (i) concurrently with any delivery under (a) or (b) a
certificate of the fine or Person referred to therein (x) which certificate
shall, in the case of the certificate of a Financial Officer, certify that to
the best of his or her knowledge no Default has occurred and, if such a Default
has occurred, specifying the nature and extent thereof and any corrective action
taken or proposed to be taken with respect thereto and (y) which certificate, in
the case of the certificate furnished by the independent public accountants in
connection with the annual financial statements, may be limited to accounting
matters and disclaim responsibility for legal interpretations, but shall in any
event state that to the best of such accountants' knowledge, as of the dates of
the financial statements being furnished no Default has occurred and, if such a
Default has occurred, specifying the nature and extent thereof, provided,
however, that any certificate delivered by the independent public accountants in
accordance herewith shall be

<PAGE>

accompanied by a supplemental certificate confirming the accuracy of the
accountants' certificate and signed by a Financial Officer;

              (e) promptly after the same become publicly available, copies of
such registration statements, annual, periodic and other reports, and such proxy
statements and other information, if any, as shall be filed by the Borrower or
any of its Subsidiaries with the SEC pursuant to the requirements of the
Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as
amended, if any;

              (f) concurrently with any delivery under (a) above, a management
letter prepared by the independent public accountants who reported on the
financial statements delivered under (a) above, with respect to the internal
audit and financial controls of the Borrower and its subsidiaries;

              (g) within 60 days after the beginning of each fiscal year, a
summary of business plans and financial operation projections (including with
respect to Capital Expenditures) for the Borrower and its Subsidiaries for such
fiscal year (including quarterly balance sheets, statements of income and of
cash flow) and annual projections through the Final Maturity Date prepared by
management and in form, substance and detail (including principal assumptions
provided separately in writing) satisfactory to the Administrative Agent;

              (h) as soon as practicable, copies of all material financial
reports, forms, filings, loan documents and financial information submitted to
governmental agencies and material financial reports distributed to its equity
holders;

              (i) promptly upon becoming aware thereof, notice to the
Administrative Agent of the occurrence of any Default then continuing; and

              (j) such other information as the Administrative Agent or any
Lender may reasonably request, including any financial information required to
be delivered under (a) or (b) as of the Closing Date but no longer required to
be delivered as a result of a change under the Securities Act of 1933, as
amended or the Securities Exchange Act of 1934, as amended.

5.2      Maintenance of Property; Insurance.

         (a) The Borrower will keep, and will cause each CK Company to keep, all
property useful and necessary in the business of the CK Companies as then
conducted in good working order and condition, ordinary wear and tear excepted.

         (b) The Borrower will maintain, with financially sound and reputable
insurance companies adequate insurance for the insurable properties of the CK
Companies, all to such extent and against such risks, including fire, casualty
and other risks insured against by extended coverage, as is customary with
companies in the same or similar businesses operating in the same or similar
locations.

5.3      Refinancing.

<PAGE>

              (a) The Borrower will use its best efforts on an expedited basis
to refinance the Loan as soon as possible after the post-Closing Date audit of
the CK Companies has been completed (the "Refinancing"). The Borrower shall use
its best efforts to cause such audit to be completed as soon as practicable
after the Closing Date.

              (b) The Borrower hereby agrees that in order to fund the
Refinancing, it shall accept an offer to purchase any debt securities (the
"Refinancing Securities") that are saleable in light of the then current market
conditions, bear an interest rate (prior to any default) of not more than the
lower of (i)15% per annum and (ii) the maximum interest rate the Borrower may be
permitted to incur under the Subordinated Debt Documents, would otherwise be
permitted under the Credit Facility to be issued by the Borrower and have a
maturity of not more ten years from the date of issuance. All other material
arrangements with respect to the Refinancing Securities shall be reasonably
satisfactory to the Borrower in light of the then prevailing market conditions.
The Borrower further covenants to use its best efforts on an expedited basis to
prepare all necessary offering documents and participate in due diligence and
marketing efforts (including a road show) in order to sell the Refinancing
Securities.

         5.4 Compliance with Laws. The Borrower will comply, and cause each
Subsidiary to comply, with all applicable laws, ordinances, rules, regulations,
and requirements of governmental authorities (including Environmental Laws and
ERISA and the rules and regulations thereunder) except where failure to comply
would not have a Material Adverse Effect, or where the necessity of compliance
therewith is being contested in good faith by appropriate proceedings.

         5.5 Inspection of Property, Books and Records. The Borrower will keep,
and will cause each Subsidiary to keep, proper books of record and account
reflecting its business and activities; and will permit, and will cause each
Subsidiary to permit, upon reasonable prior notice, representatives of any
Lender at such Lender's expense to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, senior employees and independent public accountants,
all during normal business hours and as often as may reasonably be desired;
provided that the Borrower may, at their option, have one or more employees or
representatives present at any such inspection, examination or discussion.

         5.6 Use of Proceeds. The proceeds of the Loan made under this Agreement
will be used by the Borrower solely to pay a portion of the purchase price for
the Capital Stock of the CK Companies and to pay Transaction Costs.

         5.7 Environmental Matters. The Borrower will promptly give to the
Lenders notice in writing of any complaint, order, citation or notice of
violation with respect to, or if a Borrower becomes aware of, (i) the existence
or alleged existence of a violation of any applicable Environmental Law, (ii)
any release into the environment, (iii) the commencement of any cleanup pursuant
to or in accordance with any applicable Environmental Law of any Hazardous
Materials, (iv) any proceeding pending against a Borrower for the termination,
suspension or

<PAGE>

non-renewal of any permit required under any applicable Environmental Law, (v)
any property of the Borrowers or any Subsidiary that is or will be subject to a
Lien imposed pursuant to any Environmental Law and (vi) any proposed
acquisitions or leasing of property, which, in each of cases (i) through (vi)
above, individually or in the aggregate, would have a Material Adverse Effect.

         5.8 Taxes. The Borrower will, and will cause each of its Subsidiaries
to, pay and discharge promptly when due all taxes, assessments and governmental
charges or levies imposed upon the Borrowers and their Subsidiaries or upon
their respective income or profits or in respect of their respective properties
before the same shall become delinquent or in default, as well as all lawful
claims for labor, materials and supplies or otherwise, which, if unpaid, would
give rise to Liens upon such properties or any part thereof provided, however,
that such payment and discharge shall not be required with respect to (1) any
such tax, assessment, charge, levy or claim so long as the validity or amount
thereof shall be contested in good faith by appropriate proceedings and the
applicable party, shall have set aside on its books reserves with respect
thereto as required by GAAP, and such contest operates to suspend collection of
the contested tax, assessment, charge, levy or claims and enforcement of a Lien
or (ii) any tax, assessment, charge, levy or claims, the failure to pay and
discharge when due which, individually or in the aggregate would not have a
Material Adverse Effect.

         5.9 Security Interests. The Borrower will at all times take, or permit
to be taken, all actions necessary for the Administrative Agent to maintain the
Lien on the Collateral created under the Pledge and Security Agreement as a
first priority valid and perfected Lien on the Collateral, and supply all
information to the Administrative Agent necessary for such maintenance.

         5.10 Existence; Conduct of Business. The Borrowers will, and will cause
each of the CK Companies to, do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and the
rights, licenses, permits, privileges, franchises, patents, copyrights,
trademarks and trade names material to the conduct of the business of the CK
Companies; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.3.

         5.11 Litigation and Other Notices. The Borrower will give the
Administrative Agent prompt written notice of the following:

              (a) the issuance against a Borrower or a Guarantor by any court or
Governmental Body of any injunction, order, decision or other restraint
prohibiting, or having the effect of prohibiting, the making of the Loan, or
invalidating, or having the effect of invalidating, any provision of this
Agreement or the other Loan Documents that would materially adversely affect the
Lenders' ability to enforce any payment obligations hereunder, or the initiation
of any litigation or similar proceeding seeking any such injunction, order,
decision or other restraint;

<PAGE>

              (b) the filing or commencement of any action, suit or proceeding
against the Borrower or any of its Subsidiaries, whether at law or in equity or
by or before any arbitrator or Governmental Body, (i) which is material and is
brought by or on behalf of any Governmental Body, or in which injunctive or
other equitable relief is sought or (ii) as to which it is probable (within the
meaning of Statement of Financial Accounting Standards No. 5) that there will be
an adverse determination in each case and which, if adversely determined, would
(A) reasonably be expected to result in liability of the Borrower or a
Subsidiary thereof in an aggregate amount of $5,000,000 or more, not
reimbursable by insurance, or (B) materially impairs the right of the Borrower
or a Subsidiary thereof to perform its material obligations under this
Agreement, any Note or any other Loan Document to which it is a party;

              (c) any Default, specifying the nature and extent thereof and the
action (if any) which is proposed to be taken with respect thereto;

              (d) notices given or received (with copies thereof) with respect
to the Credit Facility, Subordinated Debt Documents or any other subordinated
indebtedness; and

              (e) any development in the business or affairs of the Borrower or
any of its Subsidiaries which has had or which is likely to have, in the
reasonable judgment of the Borrower, a Material Adverse Effect.

6.       NEGATIVE COVENANTS

         The Borrower covenants and agrees with the Lenders that, so long as any
Obligation remains outstanding:

6.1      Indebtedness.

              (a) The Borrower will not, and will not permit any Subsidiary to,
create, incur, assume or permit to exist any Indebtedness, except:

                   (i) Indebtedness created under the Loan Documents;

                   (ii) Indebtedness existing on the date hereof and set forth
in Schedule 6.1 and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof or
interest thereon or fees related thereto and otherwise on substantially similar
terms to such existing Indebtedness;

                   (iii) Indebtedness of the Borrower incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof or interest thereon or fees related thereto or result in an earlier
maturity date or decreased weighted average life thereof, provided that such
Indebtedness is incurred prior to or within 90 days after such acquisition or
the completion of such construction or improvement;

<PAGE>

                   (iv) Indebtedness among the Borrower and its Subsidiaries
arising as a result of intercompany loans;

                   (v) Guarantees permitted by Section 6.4;

                   (vi) Indebtedness subject to Liens permitted under Section
6.2(a) through (f);

                   (vii) Indebtedness owing to any insurance company in
connection with the financing of any insurance premiums permitted by such
insurance company in the ordinary course of business; and

                   (viii) other unsecured Indebtedness in an aggregate principal
amount not exceeding $40,000,000 at any time outstanding.

              (b) Without limiting the generality of the foregoing, none of the
CK Companies may incur any Indebtedness other than (i) Indebtedness in the form
of letters of credit, capital leases and similar items existing on the date
hereof and replacements of the foregoing, (ii) Indebtedness to another CK
Company, (iii) Indebtedness under the Guarantee and guarantees of obligations
under the Credit Facility and CK Purchase Agreement and (iv) Indebtedness in the
form of intercompany advances made in the ordinary course of business; provided,
however, that upon the occurrence and during the continuation of an Event of
Default, any Indebtedness described in clause (iv) then outstanding shall be
subordinated to the Obligations of the Borrower hereunder and the obligations of
each Guarantor under the Guarantee.

         6.2 Liens. The Borrower will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Lien on any property or asset
now owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof except:

              (a) Permitted Encumbrances;

              (b) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the date hereof and set forth in the schedules to the
Securities Purchase Agreement or Schedule 6.2; provided that (i) such Lien shall
not apply to any other property or asset of the Borrower or any Subsidiary and
(ii) such Lien shall secure only those obligations which it secures on the date
hereof and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof or the interest rate thereon or fees
related thereto (except pursuant to the instrument creating such Lien) and are
on substantially similar terms;

              (c) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (i) such Lien
is not created in contemplation of or in connection with such

<PAGE>

acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such
Lien shall not apply to any other property or assets of the Borrower or any
Subsidiary and (iii) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof or interest
thereon or fees related thereto or otherwise alter the terms of such Lien in any
material respect;

              (d) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary; provided that (i) such security
interests secure Indebtedness permitted by clause (c) of Section 6.1, (ii) such
security interests and the Indebtedness secured thereby are incurred prior to or
within 90 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed 90% of the
cost of acquiring constructing or improving such fixed or capital assets and
(iv) such security interests shall not apply to any other property or assets of
the Borrower or any Subsidiary;

              (e) Liens created by the Loan Documents in favor of the
Administrative Agent and the Lenders and, so long as such Lien continues in
favor of the Administrative Agent, Liens created under the Credit Facility
Documents and the Liens granted to Calvin Klein pursuant to the Design Services
Security Agreement (as defined in the CK Purchase Agreement); and

              (f) licenses, leases or subleases permitted hereunder granted to
others not interfering in any material respect in the business of the Borrower
or any of its Subsidiaries.

6.3      Fundamental Changes.

              (a) The Borrower will not, and will not permit any Subsidiary to,
merge into or consolidate with any other Person, or permit any other Person to
merge into or consolidate with any of them, or sell, transfer, lease or
otherwise dispose of (in one transaction or in a series of transactions) any of
their assets, or the stock or other equity units of any of their Subsidiaries
(in each case, whether now owned or hereafter acquired), or liquidate or
dissolve other than Permitted Acquisitions (as defined in the Credit Facility),
except that (i) each of Ropa PVH Mexicana Camisas y Disenos S.A. de C. V.,
C.A.T. Industrial S.A. de C.V., Confeciones Imperio S.A., Caribe M&I Ltd. and
Camisas Modernas, S.A. may be liquidated, so long as in connection with such
liquidation no liabilities are transferred to the Borrower or any other
Subsidiary, (ii) any domestic Subsidiary (other than a Guarantor) may merge with
or into another domestic Subsidiary (provided that a Guarantor would be the
surviving Person in any merger involving a Guarantor), (iii) any domestic
Subsidiary may merge with or into the Borrower in a transaction in which the
Borrower is the surviving Person, (iv) any Guarantor may merge with or into any
other Guarantor, and (v) a foreign subsidiary may merge with or into another
foreign Subsidiary; provided that, in each case, after giving effect to such
merger, no Material Adverse Effect has occurred.

              (b) The Borrower will not, and will not permit any of its
Subsidiaries to, (i) engage to any material extent in any business other than
businesses of the type conducted by

<PAGE>

the Borrower and its Subsidiaries on the date hereof and businesses reasonably
related thereto or (ii) change its fiscal year as disclosed on Schedule 6.3.

              (c) Notwithstanding the foregoing, the Borrower and their
Subsidiaries may make:

                   (i) purchases and sales of inventory in the ordinary course;

                   (ii) (x) sales of assets (excluding capital stock of a
Subsidiary) not to exceed $10,000,000 in the aggregate in any fiscal year and
(y) sales of worn out, obsolete, scrap or surplus assets not to exceed for (x)
and (y) together $15,000,000 in the aggregate in any fiscal year and (z) sales
of other assets, in the Administrative Agent's discretion;

                   (iii) Capital Expenditures;

                   (iv) liquidations of Permitted Investments;

                   (v) Investments permitted by Section 6.4; and

                   (vi) dispositions of assets resulting from a Casualty Event.

         6.4 Investments, Loans, Advances, Guarantees and Acquisitions. The
Borrower will not, and will not permit any of its Subsidiaries to, purchase,
hold or acquire (including pursuant to any merger with any Person) any capital
stock, evidences of indebtedness or other securities (including any option,
warrant or other right to acquire any of the foregoing) of, make or permit to
exist any loans or advances to, guarantee any obligations of, or make or permit
to exist any investment or any other interest in, any other Person, or purchase
or otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit (each an "Investment").
Notwithstanding the foregoing, except with respect to any of the CK Companies,
the actions described above may be taken to the extent expressly permitted under
the Credit Facility on the date hereof as modified by the Credit Facility
Amendment. In the case of the CK Companies, they may provide guarantees of the
obligations of the Borrower under the Credit Facility and the CK Purchase
Agreement which are subordinate to the Guarantee. The Borrower will not, and
will not permit any of the Guarantors to, create or acquire any subsidiary of
the Guarantors unless all of the capital stock of such subsidiary is owned by
the Borrower or one of the Guarantors and is pledged to the Lenders under the
Pledge and Security Agreement.

         6.5 Prepayment or Modification of Indebtedness; Modification of
Operating Documents.

              (a) The Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly prepay, redeem, purchase or retire any
Indebtedness (including the Indebtedness incurred under the Debentures or the
Subordinated Debt) other than Indebtedness incurred hereunder and indebtedness
under the Credit Facility.

<PAGE>

              (b) The Borrower will not, and will not permit any of its
Subsidiaries to, modify, amend or alter the Credit Facility, the Credit Facility
Documents, the Debentures, the Debentures Indenture or any other document
evidencing or governing the Debentures or providing for any guarantee or other
right in respect thereof or any Subordinated Debt Document in a manner which
would shorten the maturity or increase interest rate grid pricing or otherwise
have a materially adverse effect on the ability of the Borrower to perform its
obligations hereunder, and shall not modify, amend or alter any subordination
provisions contained in any such documents.

              (c) The Borrower will not, and will not permit any of its
Subsidiaries to, modify, amend or alter their operating agreements, certificates
or articles of incorporation or other constitutive documents in a manner which
could have a materially adverse effect on the ability of the Borrower to perform
its obligations hereunder.

         6.6 Restricted Payments. The Borrower will not, and will not permit any
of its Subsidiaries to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, except, so long as no Default shall be
continuing or would occur after giving effect to the following, (a) Borrower may
declare and pay dividends with respect to its Capital Stock payable solely in
additional Capital Stock, (b) Subsidiaries may declare and pay dividends ratably
with respect to their Capital Stock, (c) the Borrower may make Restricted
Payments, pursuant to and in accordance with stock option plans or other benefit
plans for management or employees of the Borrower and its subsidiaries, or issue
options or warrants as otherwise approved by the Board of Directors of the
Borrower or a committee thereof and (d) the Borrower may acquire shares of its
common stock and declare and pay cash dividends with respect to its capital
stock; provided that Restricted Payments made pursuant to clause (d) shall not
exceed (i) $20,000,000 in the aggregate in any fiscal year from fiscal year 2002
through 2004, (ii) $27,500,000 in the aggregate in fiscal year 2005, (iii)
$29,400,000 in the aggregate in fiscal year 2006 and (iv) $31,400,000 in the
aggregate in fiscal year 2007; provided, further, that the Borrower may not
acquire shares of its common stock or pay cash dividends pursuant to clause (d)
in any fiscal quarter to the extent that (i) the Restricted Payment would not be
permitted in such fiscal quarter under the Credit Facility Documents or the
Subordinated Debt Documents.

         6.7 Transactions with Affiliates. The Borrower will not, and will not
permit any of its Subsidiaries to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of their
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Borrower or such Subsidiary than could
be obtained on an arm's-length basis from unrelated third parties, (b)
transactions between or among the Borrower and its Subsidiaries in the ordinary
course of business, (c) any Restricted Payment permitted by Section 6.6, (d)
loans and advances to officers, directors, employees and agents permitted under
Section 6.4, (e) fees and compensation paid to, and customary indemnity and
reimbursement provided on behalf of, officers, directors, employees and agents
of the Borrower or any of its Subsidiaries and (f) employment agreements entered
into by the Borrower or any of its Subsidiaries in the ordinary course of
business.

<PAGE>

         6.8 Restrictive Agreements. The Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, enter into, incur or permit
to exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of the Borrower or any Subsidiary to create,
incur or permit to exist any Lien upon any of its property or assets, or (b) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any shares of its capital stock or to make or repay loans or advances to the
Borrower, or any other Subsidiary or to guarantee Indebtedness of the Borrower
or any other Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by law or by this Agreement, (ii) the
foregoing shall not apply to restrictions and conditions existing on the date
hereof identified on Schedule 6.8 (but shall apply to any amendment or
modification expanding the scope of, any such restriction or condition), (iii)
the foregoing shall not apply to customary restrictions and conditions contained
in agreements relating to the sale of a Subsidiary or any asset pending such
sale, provided such restrictions and conditions apply only to the Subsidiary or
asset that is to be sold and such sale is permitted hereunder, (iv) clause (a)
of the foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to Liens permitted by this Agreement if such restrictions or
conditions apply only to the property or assets subject to such permitted Lien
and (v) clause (a) of the foregoing shall not apply to customary provisions in
leases, licenses and other contracts restricting the assignment thereof.

7.       EVENTS OF DEFAULT

         7.1 If any of the following events ("Events of Default") shall occur:

              (a) the Borrower shall fail to pay any principal of the Loan when
and as the same shall become due and payable, whether at the due date thereof or
at a date fixed for the prepayment thereof or by the acceleration thereof or
otherwise;

              (b) the Borrower shall fail to pay any interest on the Loan or any
fee or any other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement or any other Loan Document, when and as
the same shall become due and payable;

              (c) any representation or warranty made or deemed made by the
Borrower or a Guarantor in the Loan Documents, or in any report, certificate,
financial statement or other document furnished pursuant to the Loan Documents,
shall prove to have been incorrect in any material respect as of the date when
made or deemed made;

              (d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.1, 5.2 (with respect to
insurance), 5.4, 5.6, 5.9, 5.10 (with respect to the Borrower's and each CK
Company's existence) or 5.10(c) or in Article VI;

              (e) the Borrower or any Guarantor shall fail to observe or perform
any covenant, condition or agreement contained in this Agreement (other than
those specified in any other clause of this Article) or any other Loan Document,
and such failure shall continue unremedied for a period of 30 days (unless a
shorter period is specified in such Loan Document);

<PAGE>

              (f) default shall be made with respect to any Material
Indebtedness of the Borrower or any Subsidiary (excluding Indebtedness
outstanding hereunder) if the effect of any such default shall be to accelerate,
or to permit (with or without the giving of notice, the lapse of time or both)
the holder or obligee of such Indebtedness (or any trustee on behalf of such
holder or obligee) at its option to accelerate the maturity of such
Indebtedness;

              (g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any Subsidiary its debts, or of a substantial part
of its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar official
for the Borrower or any Subsidiary for a substantial part of its assets, and, in
any such case, such proceeding or petition shall continue undismissed for 90
days or an order or decree approving or ordering any of the foregoing shall be
entered;

              (h) the Borrower or any Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (g) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any Subsidiary or Guarantor or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;

              (i) Borrower or any Subsidiary shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;

              (j) one or more judgments for the payment of money in an aggregate
amount in excess of $2,500,000 (not covered by insurance where the carrier has
accepted responsibility) shall be rendered against the Borrower, any Subsidiary
or any combination thereof and the same shall remain undischarged for a period
of 45 consecutive days during which execution shall not be effectively stayed,
or any action shall be legally taken by a judgment creditor to attach or levy
upon any material assets of the Borrower or any Subsidiary to enforce any such
judgment;

              (k) an ERISA Event shall have occurred that, in the opinion of the
Requisite Lenders, when taken together with all other ERISA Events that have
occurred, could reasonably be expected to result in a Material Adverse Effect;

              (l) a Change in Control shall occur;

              (m) any of the Loan Documents shall for any reason cease to be, or
shall be asserted by any Person obligated thereunder not to be, a legal, valid
and binding obligation of such Person, including the improper filing by such
Person of an amendment or termination

<PAGE>

statement relating to a filed financing statement describing the Collateral, or
the Lien on any material portion of the Collateral created by the Pledge and
Security Agreement shall for any reason cease to be, or be asserted by any
Person granting any such Lien not to be a valid, first priority perfected Lien;

              (n) the filing of any Lien for taxes exceeding individually or in
the aggregate$1,000,000;

              (o) the subordination provisions of the Subordinated Debt shall
for any reason be revoked or invalidated or the validity or enforceability
thereof be contested in any manner by any party to the Subordinated Debt
Documents or an Event of Default (as such term is defined therein) or an event
or condition which upon notice, lapse of time or both would become an Event of
Default occurs under any agreement or instrument evidencing the Subordinated
Debt; or

              (p) default shall be made on the Borrower's obligation to pay the
Design Services Purchase Payments and such default shall continue for a period
of ___ days;

then, and in every such event (other than an event with respect to Borrower
described in clause (g) or (h) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, declare the
Loan then outstanding to be due and payable in whole (or in part, in which case
any principal not so declared to be due and payable may thereafter be declared
to be due and payable), and thereupon the principal of the Loan so declared to
be due and payable, together with accrued interest thereon and all fees and
other Obligations of the Borrower accrued hereunder, shall become due and
payable immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower or exercise any other
rights or remedies available under the Loan Documents or applicable law; and in
case of any event with respect to any Borrower described in clause (g) or (h) of
this Article, the principal of the Loans then outstanding, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued
hereunder, shall automatically become due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower.

7.2 Enforcement On Default. Upon and during the existence of any Event of
Default, the Administrative Agent may declare the Obligations due forthwith,
take all action, remedial and otherwise, as provided herein or in any Loan
Document or other document, instrument, or agreement of security or of
collateral, and collect, deal with and dispose of all or any part of any
security without notice in any manner permitted or authorized by the Code or
other applicable law (including public or private sale) and after deducting
expenses (including reasonable attorneys' fees and expenses) Administrative
Agent may apply the proceeds and any deposits or credits in part or full payment
of any of Obligations, whether due or not, in any manner it elects.

<PAGE>

8.       MISCELLANEOUS

         8.1 Notices and Addresses. Any notice, demand, request, waiver, or
other communication under this Agreement shall be in writing and shall be deemed
to have been duly given on the date of service, if personally served or sent by
facsimile; on the Business Day after notice is delivered to a courier or mailed
by express mail, if sent by courier delivery service or express mail for next
day delivery; and on the third day after mailing, if mailed to the party to whom
notice is to be given, by first class mail, registered, return receipt
requested, postage prepaid and addressed as follows:

         If to the Borrower:

                  Phillips-Van Heusen Corporation
                  200 Madison Avenue
                  New York, New York  10016
                  Attention:  Vice President, General Counsel and Secretary
                  Facsimile:   (212) 381-3970
                  Telephone:  (212) 381-3509

         with a copy to:

                  Katten Muchin Zavis Rosenman
                  575 Madison Avenue
                  New York, New York  10022
                  Attention:  David H.  Landau, Esq.
                  Facsimile:   (212) 940-8776
                  Telephone:  (212) 940-8800

         If to the Administrative Agent or any Lender:

                  Apax Partners, Inc.              Apax Partners
                  445 Park Avenue, 11th Floor      Beteiligungsberatung GmbH
                  New York, NY  10022              Possartstrasse 11
                  Attention: David Landau          Munich D 91679 Germany
                  Facsimile: (212) 319-6155        Attention:  Michael Phillips
                  Telephone: (212) 753-6300        Facsimile:  +49-89-998-9093
                                                   Telephone:  +49-89-998-9090

<PAGE>

         With a copy to:

                  Swidler Berlin Shereff Friedman, LLP
                  The Chrysler Building
                  405 Lexington Avenue
                  New York, New York 10174
                  Attention: Morris Orens, Esq.
                  Facsimile: (212) 891-9598
                  Telephone:  (212) 973-0111

         8.2 Captions. The captions in this Agreement are for convenience of
reference only and shall not be given any effect in the interpretation of this
Agreement.

         8.3 No Waiver. The failure of a party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a waiver
or deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing.
Any of the covenants or agreements contained in this Agreement may be waived
only by the written consent of the Borrower and Lenders holding or otherwise
controlling the right to vote in excess of 50% of the outstanding Loan (the
"Requisite Lenders").

         8.4 Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable Law, such provision(s) shall be excluded
from this Agreement and the balance of this Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms so long as the economic or legal substance of the transactions
contemplated by this Agreement are not affected in any manner materially adverse
to any party.

         8.5 Exclusive Agreement; Amendment. This Agreement supersedes all prior
agreements among the parties with respect to its subject matter, is intended
(with the documents referred to herein) as a complete and exclusive statement of
the terms of the agreement among the parties with respect thereto and cannot be
changed or terminated except by a written instrument executed by the party or
parties against whom enforcement thereof is sought, except that, with respect to
the Lenders, this Agreement may be amended by a written instrument executed by
the Administrative Agent on behalf of the Requisite Lenders. Notwithstanding the
foregoing the consent of each affected Lender will be required for any amendment
or waiver that (i) reduces the principal of, or reduces the rate of or changes
the time for payment of interest on any Note, or extends, the maturity of any
Note or (ii) modifies any of the provisions of this Agreement or of the Notes
with respect to the payment or prepayment thereof, or reduces the percentage of
the Loan that constitutes Requisite Lenders, or amend this Section 8.5 or
Section 8.3. Any amendment or waiver pursuant to this Section 8.5 or Section 8.3
shall apply equally to all holders of Notes and shall be binding upon them, upon
each futureholder of any Note and upon the Borrower, in each case whether or not
a notation thereof shall have been placed on any Note.

<PAGE>

         8.6 Participations.

              (a) Each Lender shall have the right at any time and from time to
time to sell to any Person participations in all or any portion of the amount of
the Loan made by such Lender; provided, however, that the amount of the Loan in
which the Lenders, collectively, have not granted participations to Persons
other than Affiliates of the Lenders shall at all times constitute in excess of
50% of the then outstanding principal amount of the Loan; and provided, further,
that no such participation shall, without the consent of the Borrower, require
the Borrower to file a registration statement with the SEC or apply to qualify
such participation under the securities law of any state. No Lender shall, as
between the Borrower and such Lender, be relieved of any of its obligations
hereunder as a result of granting any participation in the Loan.

              (b) The holder of any participation, other than an Affiliate of
the Lender granting such participation, shall not be entitled to require such
Lender to take or omit to take any action hereunder except action directly
affecting (i) the extension of the maturity date of the Loan or (ii) a reduction
of the principal amount of or the rate of interest payable on the Loan, and all
amounts payable by the Borrower hereunder shall be determined as if the Lender
had not sold such participation. The Borrower and each Lender hereby agree that,
solely for purposes Sections 8.7 and 8.13, (a) each participation will give rise
to a direct obligation of the Borrower to the participant and (b) the
participant shall be deemed to be a "Lender".

              (c) Each Lender may from time to time furnish to participants any
information regarding the Borrower and its Subsidiaries in the possession of
that Lender.

         8.7 Ratable Sharing. The Lenders hereby agree among themselves that if
any of them shall, whether by voluntary payment, by realization upon security,
through the exercise of any right of set-off or banker's lien, by counterclaim
or cross action or by the enforcement of any right under the Loan Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under Title 11 of the United States Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, fees and other
amounts then due and owing to that Lender hereunder or under the other Loan
Documents (collectively, the "Aggregate Amounts Due" to such Lender) which is
greater than the proportion received by any other Lender in respect of the
Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (i) notify the Administrative Agent and
each other Lender of the receipt of such payment and (ii) apply a portion of
such payment to purchase participations (which it shall be deemed to have
purchased from each seller of a participation simultaneously upon the receipt by
such seller of its portion of such payment) in the Aggregate Amounts Due to the
other Lenders so that all such recoveries of Aggregate Amounts Due shall be
shared by all Lenders in proportion to the Aggregate Amounts Due to them;
provided that if all or part of such proportionately greater payment received by
such purchasing Lender is thereafter recovered from such Lender upon the
bankruptcy or reorganization of the Borrower or otherwise, those purchases shall
be rescinded and the purchase prices paid for such participations shall be
returned to such purchasing Lender ratably to the extent of such recovery, but
without interest. The Borrower expressly consents to the foregoing arrangement
and agrees that any

<PAGE>

holder of a participation so purchased may exercise any and all rights of
banker's lien, set-off or counterclaim with respect to any and all monies owing
by the Borrower to that holder with respect thereto as fully as if that holder
were owed the amount of the participation held by that holder.

         8.8 Assignment; Parties in Interest.

              (a) No assignment of this Agreement or of any rights or
obligations hereunder may be made by the Borrower without the prior written
consent of the Requisite Lenders. No assignment of this Agreement or of any
rights or obligations hereunder may be made by any Lender without the prior
written consent of the Borrower; provided, however, that any Lender may assign
all or any portion of the Loan to its affiliates or to another Lender or its
affiliates without the consent of the Borrower; provided, further, that upon the
occurrence and during the continuation of an Event of Default any Lender may
assign all or any portion of the Loan. Any attempted assignment without the
required consent shall be void.

              (b) This Agreement shall be binding upon, and shall inure to the
benefit of, and be enforceable by, the parties and their respective successors,
transferees and assigns.

         8.9 Limitation of Liability. The liability of each of the Lenders for a
breach of its covenants and obligations hereunder and under the Securities
Purchase Agreement shall be limited to the amount specified in Section 9.04 of
the Securities Purchase Agreement.

         8.10 Obligations of Lenders Several. The obligations of the Lenders
hereunder shall be several and not joint. No Lender shall be responsible for the
breach of any provision of this Agreement by any other Lender.

         8.11 Governing Law. This Agreement and (unless otherwise provided) all
amendments hereof and waivers and consents hereunder shall be governed by the
internal Laws of the State of New York, without regard to the conflicts of Law
principles thereof which would specify the application of the Law of another
jurisdiction.

         8.12 Jurisdiction. Each of the Lenders and the Borrower (a) hereby
irrevocably and unconditionally submits to the exclusive jurisdiction of any
state or federal court sitting in New York County, New York for the purposes of
any suit, action or other proceeding arising out of this Agreement or the
subject matter hereof brought by the Borrower or any Lender and (b) hereby
waives and agrees not to assert, by way of motion, as a defense, or otherwise,
in any such suit, action or proceeding, any claim that it is not subject
personally to the jurisdiction of the above-named courts, that its property is
exempt or immune from attachment or execution, that the suit, action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter
hereof may not be enforced in or by such court.

         8.13 No Third Party Beneficiary. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted

<PAGE>

assigns, and it is not the intention of the parties to confer third-party
beneficiary rights upon any other Person.

         8.14 Expenses; Indemnity; Damage Waiver.

              (a) The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent in connection with the preparation and administration of the Loan
Documents or any amendments, modifications or waivers of the provisions thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), and (ii) all out-of-pocket expenses incurred by the Administrative
Agent or any Lender, including the reasonable fees, charges and disbursements of
any counsel for the Administrative Agent or any Lender, in connection with the
enforcement or protection of its rights in connection with the Loan Documents,
including its rights under this Section, or in connection with the Loan,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of the Loan.

              (b) The Borrower shall indemnify the Administrative Agent and each
Lender and each Affiliate of any of the foregoing Persons (each such Person
being called an "Indemnitee") against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related expenses, including
the fees, charges and disburseents of any counsel for any Indemnitee, incurred
by or asserted against any Indemnitee arising out of, in connection with, or as
a result of (i) the execution or delivery of any Loan Document or any other
agreement or instrument contemplated hereby, the performance by the parties to
the Loan Documents of their respective obligations thereunder or the
consummation of the transactions contemplated thereby, (ii) the Loan or the use
of the proceeds therefrom, (iii) any actual or alleged presence or release of
Hazardous Materials on or from any other property currently or formerly owned or
operated by the Borrower or any of the Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of the Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto, provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined in a final adjudication not subject to further appeal to have
resulted solely from the gross negligence or willful misconduct of such
Indemnitee or any Affiliate of such Indemnitee (or of any officer, director,
employee, advisor or agent of such Indemnitee or any of such Indemnitee's
Affiliates).

              (c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, each Lender severally
agrees to pay to the Administrative Agent, such Lender's pro rata share
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount, provided that the unreimbursed expense
or indemnified loss, claim, damage, liability or related expense, as the case
may be, was incurred by or asserted against the Administrative Agent in its
capacity as such. For purposes hereof, a Lender's "pro rata share" shall be
determined based upon its share of the Loan.

<PAGE>

              (d) To the extent permitted by applicable law, the Borrower shall
not assert, and each hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or
as a result of, this Agreement or any agreement or instrument contemplated
hereby.

              (e) All amounts due under this Section shall be payable promptly
after written demand therefor.

         8.15 Immunity of Administrative Agent. The Administrative Agent, in its
capacity as such, shall have no liability whatsoever to the Borrower. Neither
the Administrative Agent nor any of its respective officers, directors,
employees or agents shall be liable to Lenders for any action taken or omitted
by the Administrative Agent under or in connection with any of the Loan
Documents except to the extent determined in a final adjudication not subject to
further appeal to have been caused solely by the Administrative Agent's gross
negligence or willful misconduct. The Administrative Agent shall be entitled to
refrain from any act or the taking of any action (including the failure to take
an action) in connection with this Agreement or any of the other Loan Documents
or from the exercise of any power, discretion or authority vested in it
hereunder or thereunder unless and until the Administrative Agent shall have
received instructions in respect thereof from the Lenders and, upon receipt of
such instructions from the Lenders, the Administrative Agent shall be entitled
to act or (where so instructed) refrain from acting, or to exercise such power,
discretion or authority, in accordance with such instructions. Without prejudice
to the generality of the foregoing, (i) the Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for the Borrower and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against the Administrative
Agent as a result of the Administrative Agent acting or (where so instructed)
refraining from acting under this Agreement or any of the other Loan Documents
in accordance with the instructions of the Lenders.

         8.16 Survival. All covenants, agreements, representations and
warranties made by the Borrower in the Loan Documents and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement or
any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of the Loan, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time the Loan is advanced
hereunder, and shall continue in full force and effect as long as any Liability
is outstanding and unpaid. The provisions of Sections 8.7, 8.13, 8.14 and 8.16
shall survive and remain in full force and effect regardless of the consummation
of the transactions contemplated hereby or the satisfaction in full of the
Obligations.

<PAGE>

         8.17 Right of Set-off. If an Event of Default shall have occurred and
be continuing, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of the Borrower
against any of and all the obligations of the Borrower now or hereafter existing
under this Agreement held by such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement and although such
obligations may be unmatured. The rights of each Lender under this Section are
in addition to other rights and remedies (including other rights of setoff) that
such Lender may have.

         8.18 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

         8.19 Injunctive Relief. In the event that any party threatens to take
any action prohibited by this Agreement, the parties agree that there may not be
an adequate remedy at law. Accordingly, in such an event, a party may seek and
obtain preliminary and permanent injunctive relief (without the necessity of
posting any bond or undertaking). Such remedies shall, however, be cumulative
and not exclusive and shall be in addition to any other remedies which any party
may have under this Agreement or otherwise.

         8.20 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be considered an original, but all of which
together shall constitute the same instrument.

         8.21 Actions Simultaneous. All actions to be taken and all documents to
be executed and delivered by all parties at the Closing shall be deemed to have
been taken and executed and delivered simultaneously and no actions shall be
deemed to have been taken nor shall any documents be deemed to have been
executed and delivered until all actions have been taken and all documents have
been executed and delivered.

                      [signatures appear on following page]

<PAGE>

         WITNESS WHEREOF, this Agreement has been duly executed as of the date
first above written.

                             PHILLIPS-VAN HEUSEN CORPORATION

                             By:      /s/ Mark D. Fischer
                                   -------------------------------------
                             Name:  Mark D. Fischer
                             Title: Vice-President, General Counsel, Secretary

                             LENDERS:

                             APAX EXCELSIOR VI, L.P.
                             By:      Apax Excelsior VI Partners, L.P.,
                                      its general partner
                             By:      Apax Managers, Inc.,
                                      its general partner
                             By:      /s/ David Landau
                                   -------------------------------------
                             Name:  David Landau
                             Title: Vice President

                             APAX EUROPE VI-A C.V.
                             By:      Apax Excelsior VI Partners, L.P.,
                                      its general partner
                             By:      Apax Managers, Inc.,
                                      its general partner
                             By:      /s/ David Landau
                                   -------------------------------------
                             Name:  David Landau
                             Title: Vice President

                             APAX EXCELSIOR VI-B C.V.
                             By:      Apax Excelsior VI Partners, L.P.,
                                      its general partner
                             By:      Apax Managers, Inc.,
                                      its general partner
                             By:      /s/ David Landau
                                   -------------------------------------
                             Name:  David Landau
                             Title: Vice President

                             PATRICOF PRIVATE INVESTMENT CLUB III, L.P.
                             By:      Apax Excelsior VI Partners, L.P.,
                                      its general partner
                             By:      Apax Managers, Inc.,
                                      its general partner
                             By:      /s/ David Landau
                                   -------------------------------------
                             Name:  David Landau
                             Title: Vice President

<PAGE>

                             APAX EUROPE V - A, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Adrian Beecroft
                                   -------------------------------------
                             Name:   Adrian Beecroft
                             Title:  Director

                             APAX EUROPE V - B, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Clive Sherling
                                   -------------------------------------
                             Name:   Clive Sherling
                             Title:  Director

                             APAX EUROPE V - C GMBH & CO. KG
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Adrian Beecroft
                                   -------------------------------------
                             Name:   Adrian Beecroft
                             Title:  Director

                             APAX EUROPE V - D, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Clive Sherling
                                   -------------------------------------
                             Name:   Clive Sherling
                             Title:  Director

                             APAX EUROPE V - E, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Adrian Beecroft
                                   -------------------------------------
                             Name:  Adrian Beecroft
                             Title: Director

                             APAX EUROPE V - F, C.V.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Clive Sherling
                                   -------------------------------------

                             Name:  Clive Sherling
                             Title: Director

                             APAX EUROPE V - G, C.V.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Adrian Beecroft
                                   -------------------------------------
                             Name:   Adrian Beecroft
                             Title:  Director

                             APAX EUROPE V - 1, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Clive Sherling
                                   -------------------------------------

                             Name:   Clive Sherling
                             Title:  Director

                             APAX EUROPE V - 2, L.P.
                             By: Apax Partners Europe Managers Ltd.
                                    Its Investment Manager
                             By:    /s/ Adrian Sherling
                                   -------------------------------------

                             Name:   Adrian Sherling
                             Title:  Director

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