Coach 2002 Annual Report Download - page 131

(a) Annual Base Salary. At the commencement of
the Term, the Executive shall receive a base salary at a rate of
$1,000,000 per annum (the "Annual Base Salary"), paid in accordance
with the Company's general payroll practices for executives, but no
less frequently than monthly. No less frequently than annually during
the Term, the Board and the Committee shall review the rate of Annual
Base Salary payable to the Executive, and may, in their discretion,
increase the rate of Annual Base Salary payable hereunder; provided,
however, that any increased rate shall thereafter be the rate of
"Annual Base Salary" hereunder.
(b) Annual Bonus. Except as otherwise provided
for herein, with respect to each Contract Year on which the Executive
is employed hereunder on the last day, the Executive shall be eligible
to receive an annual bonus, as determined pursuant to the Coach, Inc.
Performance-Based Annual Incentive Plan or another "qualified
performance-based compensation" bonus plan that has been approved by
the stockholders of the Company in accordance with the provisions for
such approval under Code Section 162(m) and the regulations promulgated
thereunder (collectively, the "Bonus Plan"), and on the basis of the
Executive's or the Company's attainment of objective financial or other
operating criteria established by the Committee in its sole discretion
and in accordance with Code Section 162(m) and the regulations
promulgated thereunder (the "Annual Bonus"). With respect to each
Contract Year (i) the Executive shall be eligible to receive a maximum
Annual Bonus (the "Maximum Bonus") in an amount equal to at least 100%
of his Annual Base Salary and (ii) the Executive's target-level Annual
Bonus (the "Target Bonus") shall be equal to 75% of the amount of the
Maximum Bonus. For the avoidance of doubt, the Maximum Bonus may be
greater than 100% of his Annual Base Salary with respect to any
Contract Year. In addition, the Executive shall be
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eligible to participate in any other bonus plan or program that may be
established by the Committee and that covers the Executive (even if
such plan or program does not provide for qualified performance-based
bonuses within the meaning of Code Section 162(m)).
(c) Employment Agreement Signing Bonus. As of
the Effective Date, the Executive shall be paid a supplemental bonus in
the amount of $2,750,000. Notwithstanding the foregoing, if the
Executive's employment with the Company is terminated for any reason
(other than by the Company without Cause, by the Executive for Good
Reason, or due to the Executive's death or Disability) prior to the
third anniversary of the Effective Date, then, in addition to any
amount the Executive may be required to pay to the Company pursuant to
Section 11, the Executive shall be required to pay to the Company an
amount equal to the product of (i) $2,750,000 and (ii) the ratio of (A)
36 minus the number of full months the Executive was employed by the
Company following the Effective Date and prior to the date of such
termination, to (B) 36.
(d) Retention Bonuses. During the Term, in
addition to any Annual Bonuses paid to the Executive, the Executive
shall be eligible to receive the following supplemental retention bonus
payments (the "Retention Bonuses") pursuant to the terms and conditions
set forth in this Section 5(d):
(i) Subject to the Executive's
continued employment with the Company: (A) through July 1,
2004, the Executive shall be paid a supplemental bonus in the
amount of $750,000; (B) through July 1, 2005, the Executive
shall be paid a supplemental bonus in the amount of $750,000;
(C) through July 1, 2006, the Executive shall be paid a
supplemental bonus in the amount of $2,500,000; (D) through