Exhibit 10.36
September 11, 2003
Mr. Lawrence Rutkowski
69 Heather Drive
New Canaan, CT. 06840
Dear Larry,
This proposed letter agreement is our offer to employ you as Senior
Vice President and Chief Financial Officer of The Warnaco Group, Inc. (together
with its subsidiaries, divisions and affiliates, the "Company"). Except as
otherwise provided in this agreement, the terms of your employment with the
Company shall be governed by the Warnaco Job Application and current Employee
Handbook. The effectiveness of this agreement is conditioned upon (i) there
being no agreement between you and any prior employer that interferes, or could
interfere with, your employment with the Company unless such agreement is to the
satisfaction of the Company waived by such prior employer; and (ii) your
successful completion of the Company's standard pre-employment checks,
including, but not limited to, a drug test.
1. The Company agrees to employ you and you agree to serve as Senior
Vice President and Chief Financial Officer of the Company, and you
shall have such authorities, duties and responsibilities
commensurate with the position of Chief Financial Officer. In
carrying out your duties, you shall report to the Chief Executive
Officer of the Company. You agree to devote your full time and best
efforts to the satisfactory performance of such services and duties
as the position requires, and you shall be entitled to (i) serve on
the boards of directors of trade associations and charitable
organizations, subject to the good faith approval of the Chief
Executive Officer of the Company and the Company's Board of
Directors which approval shall not be unreasonably withheld, (ii)
engage in charitable activities and community affairs and (iii)
manage your personal investments and affairs, provided that such
activities do not interfere with the proper performance of your
duties and responsibilities for the Company.
2. The term (the "Term") of your employment shall begin as of the date
you execute this agreement (the "Commencement Date") and end at the
close of business on the second anniversary of the Commencement
Date; provided, however, that the Term shall thereafter be
automatically extended for additional one-year periods unless
either you or the Company gives the other written notice at least
120 days prior to the then-scheduled expiration of the Term that
such party is electing not to so extend the Term. Notwithstanding
the foregoing, the Term shall end on the date on which your
employment is terminated by either party in accordance with the
provisions herein.
3. Your compensation shall be as follows:
Mr. Lawrence Rutkowski
September 11, 2003
Page 2
a. During the Term, you shall be paid an annual base salary of
$550,000 ("Base Salary"), payable in semi-monthly payments
of $22,916.66. Your Base Salary may be reviewed annually by
the Chief Executive Officer and may be increased based on
such performance review within the Company's discretion. You
shall not be entitled to any additional compensation for
service as an officer or member of any board of directors of
any affiliate of the Company.
b. During the Term, commencing with the Company's fiscal year
2004, you shall be eligible to receive an annual cash
incentive award under The Warnaco Group, Inc. Incentive
Compensation Plan ("Bonus Plan") with a target of 70% of
Base Salary ("Target Bonus"). The terms and conditions
applicable to such annual cash incentive award, including
but not limited to the determination of performance targets
(following consultation with you), the ultimate amount of
such award, and the timing of payment of any such award,
shall be determined in accordance with the terms of the
Bonus Plan
i. For fiscal year 2003, you shall receive a guaranteed
pro-rata annual incentive award, which shall be
calculated by multiplying the annual incentive award
you would have been entitled to receive if you had
been employed for a full fiscal year based on the
Target Bonus by a fraction, the numerator of which is
the number of days you were employed during fiscal
year 2003 and the denominator of which is 365. Any
annual incentive award, including any annual
incentive award for fiscal year 2003, shall be
payable when bonuses for the applicable performance
period are paid to other senior executives of the
Company.
c. Pursuant to the Warnaco 2003 Stock Incentive Plan (the
"Plan"), on the Commencement Date you will be granted 50,000
shares of restricted stock ("restricted stock") and an
option to purchase 200,000 shares of the Company's
outstanding common stock (the "option"), subject to the
terms and conditions of such awards as set out in the Plan.
You may also be eligible to receive future grants of
restricted stock and/or options or other forms of equity
compensation at the sole discretion of the Compensation
Committee of the Board of Directors.
i. Except as otherwise provided herein, the restricted
stock as described herein and the option as described
herein shall vest 25% on February 29, 2004 and shall
vest 25% on each of February 28, 2005, February 28,
2006 and February 28, 2007, provided that you are
employed by the Company on such vesting date and have
not given notice to the Company that you are
voluntarily resigning, without Good Reason (as
Mr. Lawrence Rutkowski
September 11, 2003
Page 3
defined in Exhibit A) prior to such vesting date. The
form of the Restricted Stock Award Agreement for the
restricted stock is attached hereto as Exhibit B. The
form of the Non-Qualified Stock Option Agreement for
the option is attached hereto as Exhibit C.
ii. You shall be subject to the equity ownership,
retention and other requirements applicable to senior
executives of the Company. Except as otherwise
expressly provided herein, all equity grants shall be
governed by the applicable plan and award agreement,
as in effect on the date hereof and as may be
hereafter changed in accordance with such plan and
agreement.
4. While you are employed by the Company, and subject, of course, to
the Company's right to amend, modify or terminate any benefit plan
or program, you shall be entitled to participate in all Company
employee benefit plans applicable to senior executives, including
the following benefits/perquisites:
a. Reimbursement of reasonable business expenses incurred in
carrying out your duties and responsibilities under this
agreement, subject to documentation in accordance with
Company policy. In addition, the Company will reimburse you
for your legal and other professional fees reasonably
incurred in connection with the negotiation and drafting of
this agreement, up to a maximum of $10,000.
b. Perquisites provided to other senior executives, including a
monthly car allowance of up to $700.
c. Vacation - four weeks paid vacation per calendar year.
5. In the event your employment is terminated without Cause (as
defined in Exhibit A) by the Company (other than upon death or due
to Disability (as defined in Exhibit A)) or you resign for Good
Reason (as defined in Exhibit A) (other than due to Disability)
during the Term, you shall be entitled to:
a. Base Salary through the Date of Termination (as defined in
Exhibit A).
b. Payment of Base Salary as salary continuation for the
remainder of the Term, but in no event less than 12 months.
c. A pro-rata bonus for the fiscal year in which the Date of
Termination occurs, based on the Company's performance for
such year (determined by multiplying the amount you would
have received had your employment
Mr. Lawrence Rutkowski
September 11, 2003
Page 4
continued through the end of such fiscal year by a fraction,
the numerator of which is the number of days during such
fiscal year that you are employed by the Company and the
denominator of which is 365), payable when bonuses for such
fiscal year are paid to other Company executives.
d. Immediate vesting of that portion of the restricted stock
described in paragraph 3(c) above that would have vested if
you had been employed on the vesting date immediately
following the Date of Termination.
e. That portion of the option described in paragraph 3(c) above
that has vested as of the Date of Termination remaining
exercisable for two years following the Date of Termination.
f. Continued participation on the same terms as immediately
prior to the Date of Termination (including costs of
premiums) for you and your eligible dependents in the
Company's medical and dental plans in which you and your
eligible dependents were participating immediately prior to
the Date of Termination until the earlier of (a) the end of
the applicable Term (without regard to its earlier
termination hereunder), but in no event less than 12 months,
or (b) the date, or dates, you receive equivalent coverage
under the plans and programs of a subsequent employer.
g. Outplacement counseling and use of an office during the
period Base Salary is paid as salary continuation under
paragraph 5(b) above.
h. Any amounts earned, accrued or owing to you but not yet paid.
i. As a condition to receiving severance compensation pursuant
to this paragraph 5, you hereby agree to execute, and not
revoke, a general release of claims in a form acceptable to
the Company (provided you shall be afforded seven days after
execution of such release to revoke it, in which event you
shall not be entitled to the benefits provided herein other
than as required by law).
6. In the event your employment is terminated upon death or due to
Disability during the Term, you (or your estate or legal
representative, as the case may be) shall be entitled to:
a. Base Salary through the Date of Termination.
b. A pro-rata bonus for the fiscal year in which the Date of
Termination occurs, based on the Company's performance for
such year (determined by multiplying the amount you would
have received had your employment
Mr. Lawrence Rutkowski
September 11, 2003
Page 5
continued through the end of such fiscal year by a fraction,
the numerator of which is the number of days during such
fiscal year that you are employed by the Company and the
denominator of which is 365), payable when bonuses for such
fiscal year are paid to other Company executives.
c. Immediate vesting of 50% of the restricted stock described in
paragraph 3(c) above that remains unvested as of the Date of
Termination and 100% of that portion of the option described
in paragraph 3(c) above that remains unvested as of the Date
of Termination, with any vested portion of such option
remaining exercisable for 12 months following the Date of
Termination.
d. Any amounts earned, accrued or owing to you but not yet paid.
7. In the event the Company terminates your employment for Cause or
you voluntarily resign, you shall be entitled to Base Salary
through the Date of Termination. In the event of your termination
for Cause, the unvested restricted stock described in paragraph
3(c) above and that portion of the option described in paragraph
3(c) above that remains unvested as of the Date of Termination
shall be forfeited. In the event of your voluntary resignation, the
unvested restricted stock described in paragraph 3(c) above and
that portion of the option described in paragraph 3(c) above that
remains unvested as of the date on which you provide written notice
to the Company that you are voluntarily resigning shall be
forfeited. A voluntary resignation shall be effective on 60 days
prior written notice, subject to early termination by the Company,
and, provided that such notice is given, shall not be deemed to be
a breach of this agreement.
8. In the event your employment is terminated without Cause by the
Company (other than upon death or due to Disability) or you resign
for Good Reason (other than due to Disability), in both cases
within one year following a Change in Control (as defined on
Exhibit A) (provided the Term is still in effect or has expired
during the one-year period), you shall be entitled to:
a. Base Salary through the Date of Termination.
b. Payment of Base Salary as salary continuation for the
remainder of the Term, but in no event less than 12 months.
c. A pro-rata bonus for the fiscal year in which the Date of
Termination occurs, based on the Company's performance for
such year (determined by multiplying the amount you would
have received had your employment continued through the end
of such fiscal year by a fraction, the numerator of which is
the number of days during such fiscal year that you are
employed by
Mr. Lawrence Rutkowski
September 11, 2003
Page 6
the Company and the denominator of which is 365), payable
when bonuses for such fiscal year are paid to other Company
executives.
d. Immediate vesting of 100% of any of the restricted stock
described in paragraph 3(c) above that remains unvested as of
the Date of Termination and 100% of that portion of the
option described in paragraph 3(c) above that remains
unvested as of the Date of Termination, with any vested
portion of such option remaining exercisable for six months
following the Date of Termination.
e. Continued participation on the same terms as immediately
prior to the Date of Termination (including costs of
premiums) for you and your eligible dependents in the
Company's medical and dental plans in which you and your
eligible dependents were participating immediately prior to
the Date of Termination until the earlier of (a) the end of
the applicable Term (without regard to its earlier
termination hereunder), but in no event less than 12 months,
or (b) the date, or dates, you receive equivalent coverage
under the plans and programs of a subsequent employer.
f. Any amounts earned, accrued or owing to you but not yet paid.
g. As a condition to receiving severance compensation pursuant
to this paragraph 8, you hereby agree to execute, and not
revoke, a general release of claims in a form acceptable to
the Company (provided you shall be afforded seven days after
execution of such release to revoke it, in which event you
shall not be entitled to the benefits provided herein other
than as required by law).
9. In the event the Company provides written notice to you in
accordance with paragraph 2 above that the Term shall not renew and
upon such expiration of the Term the Company terminates your
employment under circumstances that during the Term would
constitute a termination of employment without Cause, you shall be
entitled to:
a. Base Salary through the Date of Termination.
b. Payment of Base Salary as salary continuation for six months
following the Date of Termination.
c. That portion of the option described in paragraph 3(c) above
that has vested as of the Date of Termination remaining
exercisable for nine months following the Date of
Termination.
Mr. Lawrence Rutkowski
September 11, 2003
Page 7
d. Continued participation on the same terms as immediately
prior to the Date of Termination (including costs of
premiums) for you and your eligible dependents in the
Company's medical and dental plans in which you and your
eligible dependents were participating immediately prior to
the Date of Termination for six months following the Date of
Termination.
e. Any amounts earned, accrued or owing to you but not yet paid.
f. As a condition to receiving severance compensation pursuant
to this paragraph 9, you hereby agree to execute, and not
revoke, a general release of claims in a form acceptable to
the Company (provided you shall be afforded seven days after
execution of such release to revoke it, in which event you
shall not be entitled to the benefits provided herein other
than as required by law).
10. Any amounts due to you under paragraphs 5, 6, 8 or 9 are in the
nature of severance payments considered to be reasonable by the
Company and are not in the nature of a penalty. Any payments
provided pursuant to paragraph 5, paragraph 8 or paragraph 9 shall
be in lieu of any salary continuation arrangements under any other
severance program of the Company.
11. Notwithstanding any other provision of this Agreement, upon the
termination of your employment for any reason, unless otherwise
requested by the Board, you shall immediately resign from all
boards of directors of any affiliate of the Company, if any, of
which you may be a member, and as a trustee of, or fiduciary to,
any employee benefit plans of the Company or any affiliate of the
Company. You agree to execute any and all documentation of such
resignations upon request by the Company, but you shall be treated
for all purposes as having so resigned upon termination of your
employment, regardless of when or whether you execute any such
documentation.
12. You acknowledge that in your capacity in management you have had or
will have a great deal of exposure and access of the Company's
trade secrets and confidential and proprietary information.
Therefore, during the Term and thereafter (provided you are
employed by the Company) and for 12 months following the
termination of your employment with the Company, to protect the
Company's trade secrets and other confidential and proprietary
information, you agree that you will not, other than in the
ordinary course of performing your duties hereunder or as agreed by
the Company in writing, engage in a "Competitive Business,"
directly or indirectly, as an individual, partner, shareholder,
director, officer, principal, agent, employee, trustee, consultant,
or in any relationship or capacity, in any geographic location in
which the Company or any of its affiliates is engaged in business.
You shall not be deemed to be in violation of this paragraph 12 by
reason of the fact that you own or acquire, solely as
Mr. Lawrence Rutkowski
September 11, 2003
Page 8
an investment, up to two percent (2%) of the outstanding equity
securities (measured by value) of any entity. "Competitive
Business" shall mean a business primarily engaged in apparel
design, apparel wholesaling or apparel retailing.
13. Upon any termination of employment, you agree to refrain from
directly or indirectly soliciting any employee of the Company or an
affiliate of the Company to terminate his/her employment
(excluding, only, your personal assistant) on your own behalf or on
behalf of any other person or entity or from directly or indirectly
hiring any key employee (e.g., any management-level employee or any
designer) of the Company for a period of eighteen (18) months
thereafter. In addition, you agree that for a period of eighteen
(18) months following the termination of your employment with the
Company, you will not, without the prior written consent of the
Company, directly or indirectly, solicit or encourage any customer
of the Company or any affiliate of the Company to reduce or cease
its business with the Company or any such affiliate of the Company
or otherwise interfere with the relationship of the Company or any
affiliate of the Company with its customers. You and the Company
each agree to refrain from making any statements or comments of a
defamatory or disparaging nature to third parties regarding each
other (including, in the case of the Company, an affiliate of the
Company or the Company's officers, directors, personnel or
products). You and the Company each understand that either party
should be entitled to respond truthfully and accurately to
statements about such party made publicly by you or the Company, as
the case may be, provided that such response is consistent with
your or the Company's obligations not to make any statements or
comments of a defamatory or disparaging nature as set forth herein
above.
14. During the Term and thereafter, other than in the ordinary course
of performing your duties for the Company or as required in
connection with providing any cooperation to the Company pursuant
to paragraph 20 below, you agree that you will not disclose to
anyone or make use of any trade secret or proprietary or
confidential information of the Company or any affiliate of the
Company, including such trade secret or proprietary or confidential
information of any customer or other entity to which the Company
owes an obligation not to disclose such information, which you
acquire during the course of your employment, including, but not
limited to, records kept in the ordinary course of business, except
when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a
committee thereof) with apparent or actual jurisdiction to order
you to divulge, disclose or make accessible such information. The
foregoing shall not apply to information that (i) was known to the
public prior to its disclosure by you or (ii) becomes known to the
public through no wrongful disclosure by or act of you or any of
your representatives. In the event you are requested by subpoena,
court order, investigative demand, search warrant or other legal
process to disclose any information regarding the Company,
Mr. Lawrence Rutkowski
September 11, 2003
Page 9
you agree, unless prohibited by law or Securities and Exchange
Commission regulation, to give the Company's General Counsel prompt
written notice of any request for disclosure in advance of your
making such disclosure and you shall not disclose such information
regarding the Company unless and until the Company has expressly
authorized you to do so in writing or the Company has had a
reasonable opportunity to object to such a request or to litigate
the matter (of which the Company agrees to keep you reasonably
informed) and has failed to do so.
15. You hereby sell, assign and transfer to the Company all of your
right, title and interest in and to all inventions, discoveries,
improvements and copyrightable subject matter (the "Rights") which
during the period of your employment are made or conceived by you,
alone or with others, and which are within or arise out of any
general field of the Company's business or arise out of any work
you perform, or information you receive regarding the business of
the Company, while employed by the Company. You shall fully
disclose to the Company as promptly as available all information
known or possessed by you concerning any Rights, and upon request
by the Company and without any further remuneration in any form to
you by the Company, execute all applications for patents and for
copyright registration, assignments thereof and other instruments
and do all things which the Company may deem necessary to vest and
maintain in it the entire right, title and interest in and to all
such Rights.
16. You agree that at the time of the termination of employment,
whether at your instance or the Company, and regardless of the
reasons therefore, you will promptly deliver to the Company's
General Counsel, and not keep or deliver to anyone else, any and
all of the following which is in your possession or control: (i)
Company property (including, without limitation, credit cards,
computers, communication devices, home office equipment and other
Company tangible property) and (ii) notes, files, memoranda, papers
and, in general, any and all physical matter and computer files
containing confidential or proprietary information of the Company
or any of the Company's affiliates, including any and all documents
relating to the conduct of the business of the Company or any of
the Company's affiliates and any and all documents containing
confidential or proprietary information of the customers of the
Company or any of the Company's affiliates, except for (x) any
documents for which the Company's General Counsel has given written
consent to removal at the time of termination, (y) any documents on
your personal computer if you destroy such documents and give a
notarized written affidavit of such destruction and (z) any
information necessary for you to retain for tax purposes (provided
you maintain the confidentiality of such information in accordance
with paragraph 14 above).
17. Any failure by you to comply with the provisions of paragraphs 12,
13, 14, 15 or 16 shall relieve the Company of any of its
obligations pursuant to this agreement, including pursuant to
paragraphs 5, 6, 8 and 9.
Mr. Lawrence Rutkowski
September 11, 2003
Page 10
18. From and after the date hereof, should any disagreement, claim or
controversy arise between you and the Company with respect to this
agreement, the same may be enforced at the option of either party
by confidential, binding and final arbitration in New York, New
York before a single arbitrator in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The
award of the arbitrator with respect to such disagreement, claim or
controversy shall be enforceable in any court of competent
jurisdiction and shall be binding upon the parties hereto. You
consent to the personal jurisdiction of the Courts of the State of
New York (including the United States District Court for the
Southern District of New York) in any proceedings for equitable
relief. You further agree not to interpose any objection or
improper venue in any such proceeding or interpose any defense that
the Company has an adequate remedy at law or that the injury
suffered by the Company is not irreparable. You and the Company
agree that each party shall be responsible for its own costs and
expenses, including attorneys' fees, provided, however, that if you
substantially prevail with respect to all claims that are the
subject matter of the dispute, your costs, including reasonable
attorneys' fees, shall be borne by the Company.
19. You expressly agree and acknowledge that any breach or threatened
breach of any obligation set forth in paragraphs 12, 13, 14, 15 or
16 above will cause the Company irreparable harm for which there is
no adequate remedy at law, and as a result of this the Company
shall be entitled to seek the issuance by a court of competent
jurisdiction of an injunction, restraining order or other equitable
relief in favor of itself, without the necessity of posting a bond
and without proving actual damages, restraining you from committing
or continuing to commit any such violation.
20. Following the Date of Termination, upon reasonable request by the
Company, you shall cooperate with the Company or any of its
affiliates with respect to any legal or investigatory proceeding,
including any government or regulatory investigation, or any
litigation or other dispute relating to any matter in which you
were involved or had knowledge during your employment with the
Company, subject to your reasonable personal and business
schedules. The Company shall reimburse you for all reasonable
out-of-pocket costs, such as travel, hotel, and meal expenses, and
reasonable attorneys' fees, incurred by you in providing any
cooperation pursuant to this paragraph 20, as well as a reasonable
per diem amount for your time which shall be based upon your Base
Salary at the Date of Termination.
21. You represent and warrant that you have the free and unfettered
right to enter into this agreement and to perform your obligations
under it and that you know of no agreement between you and any
other person, firm or organization, or any law or regulation, that
would be violated by the performance of your obligations under this
Mr. Lawrence Rutkowski
September 11, 2003
Page 11
agreement. You agree that you will not use or disclose any
confidential or proprietary information of any prior employer in
the course of performing your duties for the Company or any of its
affiliates.
22. The invalidity or unenforceability of any particular provision or
provisions of this agreement (as determined by an arbitrator or a
court of competent jurisdiction) shall not affect the other
provisions hereof and this agreement shall be construed in all
respects as if such invalid or unenforceable provisions had been
omitted.
23. This agreement (including its Exhibits) and the documents referred
to herein constitute the full and complete understanding and
agreement of the parties, supersede all prior representations,
understandings and agreements as to your employment by the Company
and cannot be amended, changed, modified in any respect, without
the written consent of the parties, except that the Company
reserves the right in its sole discretion to make changes at any
time to the other documents referenced in this letter agreement. No
waiver by either party of any breach by the other party of any
condition or provision contained in this agreement shall be deemed
to be a waiver of a similar or dissimilar condition or provision.
24. This agreement shall be binding upon and shall inure to the benefit
of successors and assigns of the Company.
25. This agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to its
provisions as to choice of laws. The respective rights and
obligations of the parties hereunder, including without limitation
paragraphs 12 through 16, shall survive any expiration of the Term,
including expiration thereof upon your termination of employment
for whatever reason, to the extent necessary to the intended
preservation of such rights and obligations.
26. Any notice given to either you or the Company under this agreement
shall be in writing and shall be deemed to have been given upon
actual receipt or refusal to accept receipt, with any such notice
duly addressed to you or the Company, as the case may be, at the
address indicated below or to such other address as such Party may
subsequently designate by written notice in accordance with this
paragraph 26: If to the Company: The Warnaco Group, Inc., 90 Park
Avenue, New York, New York 10016, Attention: General Counsel; If to
you: at your home address as indicated on the Company's records.
27. The Company may withhold from any amounts payable under this
agreement such Federal, state, local or other taxes as shall be
required to be withheld pursuant to any applicable law or
regulation.
Mr. Lawrence Rutkowski
September 11, 2003
Page 12
Your signature below will signify that you have read, and understand
and agree to, the terms and conditions contained in each item of the new-hire
paperwork.
Mr. Lawrence Rutkowski
September 11, 2003
Page 13
This agreement shall not be binding on the Company until you sign, date
and deliver an original of this agreement to Jay A. Galluzzo at the Company's
address set forth in paragraph 26 above and its effectiveness is contingent on
the circumstances set forth in the introductory paragraph of this agreement. If
the foregoing is agreeable to you, please sign both copies of this agreement and
return them to me. A fully executed original will be returned to you.
Very truly yours,
THE WARNACO GROUP, INC.
/s/ Jay A. Galluzzo
-------------------------------------------
Jay A. Galluzzo
Vice President, General Counsel & Secretary
Agreed to and accepted this
11th day of September, 2003
/s/ Lawrence Rutkowski
- ---------------------------------------
Lawrence Rutkowski
Mr. Lawrence Rutkowski
September 11, 2003
Page 14
Exhibit A
Definitions
"Cause" shall mean:
(i) willful misconduct by you which is injurious to the Company's interests;
(ii) willful breach of duty by you in the course of your employment, which, if
curable, is not cured within 10 days after your receipt of written notice
from the Company;
(iii) willful failure by you after having been given written notice from the
Company to perform your duties other than a failure resulting from your
incapacity due to physical or mental illness; or
(iv) indictment of you for the commission of a felony, or your engagement in
other willful misconduct which is injurious to the business or reputation
of the Company.
"Change in Control" shall mean any of the following:
(i) any "person" (as such term is used in Sections 3(a)(9) and 13(d) of the
Securities Exchange Act of 1934), but excluding a person who owns more
than 5% of the outstanding shares of the Company as of the Commencement
Date, becomes a "beneficial owner" (as such term is used in Rule 13d-3
promulgated under that Act), of 50% or more of the Voting Stock of the
Company, provided that any sale or transfer of Voting Stock by
shareholders as of the Commencement Date shall not constitute a Change in
Control; or
(ii) all or substantially all of the assets of the Company are disposed of
pursuant to a merger, consolidation or other transaction (unless the
shareholders of the Company immediately prior to such merger,
consolidation or other transaction beneficially own, directly or
indirectly, in substantially the same proportion as they owned the Voting
Stock of the Company, all of the Voting Stock or other ownership interests
of the entity or entities, if any, that succeed to the business of the
Company).
For purposes of this Change in Control definition, "Voting Stock" shall
mean the capital stock of any class or classes having general voting power, in
the absence of specified contingencies, to elect the directors of the Company.
Mr. Lawrence Rutkowski
September 11, 2003
Page 15
"Date of Termination" shall mean:
(i) if your employment is terminated by the Company, the date specified in the
notice by the Company to you that your employment is so terminated;
(ii) if you voluntarily resign your employment, 60 days after receipt by the
Company of written notice that you are terminating your employment
(provided, that the Company may accelerate the Date of Termination to an
earlier date by providing you with written notice of such action, or,
alternatively, the Company may place you on paid leave (covering only Base
Salary) during such period);
(iii) if your employment is terminated by reason of death, the date of death; or
(iv) if you resign your employment for Good Reason, 30 days after receipt by
the Company of timely written notice from you in accordance with paragraph
26 of the letter agreement dated September 11, 2003 between you and the
Company, unless the Company cures the event or events giving rise to Good
Reason within 30 days after receipt of such written notice.
"Disability" shall mean your inability, due to physical or mental incapacity, to
substantially perform your duties and responsibilities for a period of 120
consecutive days as determined by a medical doctor selected by the Company
and reasonably acceptable to you.
"Good Reason" shall mean the occurrence of any of the following without your
consent:
(i) a material diminution in your authority, duties or responsibilities as
Chief Financial Officer of the Company;
(ii) a reduction in your Base Salary or Target Bonus;
(iii) a change in reporting structure so that you report to someone other than
the Chief Executive Officer of the Company;
(iv) the removal by the Company of you as Chief Financial Officer of the
Company;
(v) the failure of a successor to all or substantially all of the assets of
the Company to assume the Company's obligations under the letter agreement
either in writing or as a matter of law; or
(vi) requiring you to be principally based at any office or location other than
Manhattan or Westchester County, New York, provided that you will be
required to spend time at the
Mr. Lawrence Rutkowski
September 11, 2003
Page 16
Company's Milford, Connecticut office where the Company's finance and
accounting departments are located.
Anything herein to the contrary notwithstanding, you shall not be
entitled to resign for Good Reason unless you give the Company written notice of
the event constituting "Good Reason" within 60 days of the occurrence of such
event and the Company fails to cure such event within 30 days after receipt of
such notice.
Mr. Lawrence Rutkowski
September 11, 2003
Page 17
Exhibit B
THE WARNACO GROUP, INC.
2003 STOCK INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT
THIS RESTRICTED STOCK AWARD AGREEMENT, (the "Agreement"), dated as of
September 11, 2003, is made by and between The Warnaco Group, Inc., a Delaware
corporation (the "Company"), and Lawrence Rutkowski, an employee of the Company
(the "Grantee").
WHEREAS, the Company has adopted The Warnaco Group, Inc. 2003 Stock
Incentive Plan (the "Plan"), pursuant to which the Company may grant Shares
which are restricted as to transfer (Shares so restricted hereinafter referred
to as "Restricted Stock");
WHEREAS, the Company desires to grant to the Grantee the number of
shares of Restricted Stock provided for herein;
NOW, THEREFORE, in consideration of the recitals and the mutual
agreements herein contained, the parties hereto agree as follows:
Section 1. Grant of Restricted Stock Award
(a) Grant of Restricted Stock. The Company hereby grants to the Grantee
50,000 shares of Restricted Stock on the terms and conditions set forth in this
Agreement and as otherwise provided in the Plan.
(b) Incorporation of Plan. The provisions of the Plan are hereby
incorporated herein by reference. Except as otherwise expressly set forth
herein, this Agreement shall be construed in accordance with the provisions of
the Plan and any capitalized terms not otherwise defined in this Agreement shall
have the definitions set forth in the Plan; provided, however, that for purposes
of paragraphs 2(e), 2(f) and 2(g) below, the capitalized terms "Cause," "Change
in Control," "Disability" and "Good Reason" shall have the meanings ascribed to
them in that certain letter agreement ("Letter Agreement"), dated September 11,
2003, between the Company and the Grantee. The Committee shall have final
authority to interpret and construe the Plan and this Agreement and to make any
and all determinations thereunder, and its decision shall be binding and
conclusive upon the Grantee and his legal representative in respect of any
questions arising under the Plan or this Agreement.
Mr. Lawrence Rutkowski
September 11, 2003
Page 18
Section 2. Terms and Conditions of Award
The grant of Restricted Stock provided in Section 1(a) shall be subject to
the following terms, conditions and restrictions:
(a) Ownership of Shares. Subject to the restrictions set forth in the Plan
and this Agreement, the Grantee shall possess all incidents of ownership of the
Restricted Stock granted hereunder, including the right to receive dividends
with respect to such Stock and the right to vote such Stock.
(b) Restrictions. Restricted Stock and any interest therein, may not be
sold, assigned, transferred, pledged, hypothecated or otherwise disposed of,
except by will or the laws of descent and distribution, prior to the lapse of
restrictions set forth in this Agreement applicable thereto, as set forth in
Section 2(d); provided, however, that this Award may be transferred to a
Permitted Transferee if such transfer is without consideration; and provided,
further, that, following such a transfer, the Award shall continue to be subject
to the terms and conditions set forth in this Agreement and in the Plan. The
Committee may, in its discretion, cancel all or any portion of any outstanding
restrictions prior to the expiration of the periods provided in Section 2(d).
(c) Certificate; Restrictive Legend. The Grantee agrees that any
certificate issued for Restricted Stock prior to the lapse of any outstanding
restrictions relating thereto shall be inscribed with the following legend:
This certificate and the shares of stock represented hereby are subject to
the terms and conditions, including forfeiture provisions and restrictions
against transfer (the "Restrictions"), contained in The Warnaco Group,
Inc. 2003 Stock Incentive Plan (the "Plan") and an agreement entered into
between the registered owner and the Company (the "Agreement"). Any
attempt to dispose of these shares in contravention of the Restrictions,
including by way of sale, assignment, transfer, pledge, hypothecation or
otherwise, shall be null and void and without effect.
(d) Lapse of Restrictions. Except as may otherwise be provided herein, the
restrictions on transfer set forth in Section 2(b) shall lapse with respect to
twenty-five percent (25%) of the shares of Restricted Stock granted hereunder on
February 29, 2004 and with respect to an additional twenty-five percent (25%) of
such shares on each of February 28, 2005, February 28, 2006 and February 28,
2007, so long as the Grantee is employed by or providing services to the Company
as of the relevant date and has not given the Company written notice on or prior
to such date that he is voluntarily resigning.
Upon each lapse of restrictions relating to Restricted Stock, the Company
shall issue to the Grantee or the Grantee's personal representative a stock
certificate representing a number of
Mr. Lawrence Rutkowski
September 11, 2003
Page 19
shares of Stock, free of the restrictive legend described in Section 2(c), equal
to the number of shares of Restricted Stock with respect to which such
restrictions have lapsed. If certificates representing such Restricted Stock
shall have theretofore been delivered to the Grantee, such certificates shall be
returned to the Company, complete with any necessary signatures or instruments
of transfer prior to the issuance by the Company of such unlegended shares of
Stock.
(e) Termination of Employment. Except as otherwise provided in the Letter
Agreement, in the event that the Grantee ceases to employed by the Company prior
to the lapsing of restrictions with respect to any portion of the Restricted
Stock granted hereunder, such portion of the Restricted Stock held by the
Grantee shall become free of such restrictions or be forfeited as follows:
(i) If the Grantee's employment is terminated due to his death or
Disability, all restrictions applicable to 50% of the Restricted Stock
then subject to this Award shall lapse as of the effective date of such
termination of employment;
(ii) If the Grantee's employment is terminated by the Company for
Cause, or if the Grantee voluntarily terminates his employment or provides
written notice to the Company that he is voluntarily resigning, all such
Restricted Stock then held by the Grantee (or his legatees, personal
representative or Permitted Transferees) shall be forfeited as of the date
of such termination or notice of voluntary resignation; and
(iii) Except as set forth in Section 2(g)(i) below, if the Grantee's
termination of employment is for any other reason (including a Grantee's
ceasing to be employed by an affiliate of the Company as a result of the
sale of such subsidiary or an interest in such affiliate), all Restricted
Stock then held by the Grantee (or his legatees, personal representative
or Permitted Transferees) as of the date of such termination of employment
shall be forfeited as of the date of such termination unless otherwise
determined by the Committee in its sole discretion.
Restricted Stock forfeited pursuant to this Section 2(e) shall be
transferred to, and reacquired by, the Company without payment of any
consideration by the Company, and neither the Grantee nor any of the Grantee's
successors, heirs, assigns, personal representatives or Permitted Transferees
shall thereafter have any further rights or interests in such shares or
certificates. If certificates containing restrictive legends shall have
theretofore been delivered to the Grantee (or his legatees, personal
representative or Permitted Transferee), such certificates shall be returned to
the Company, complete with any necessary signatures or instruments of transfer.
(f) Additional Forfeiture upon Termination for Cause. In addition to the
forfeiture of Restricted Stock as provided in Section 2(e) (including if
forfeiture is pursuant to the Letter Agreement), if the Grantee's termination of
employment or service is by the Company for Cause,
Mr. Lawrence Rutkowski
September 11, 2003
Page 20
the Grantee shall forfeit, and shall return to the Company without
consideration, any Shares owned by the Grantee that were previously subject to
this Award and with respect to which the restrictions applicable to such Shares
lapsed during the six-month period immediately prior to such termination. To the
extent the Shares subject to this Section 2(f) have been previously sold or
otherwise disposed of by the Grantee, the Grantee shall repay to the Company the
aggregate fair market value of such Shares on the date of such sale or
disposition; provided, however, that to the extent such Shares have been
previously sold or otherwise disposed of to a Permitted Transferee, the Grantee,
without being relieved of the repayment obligation to be satisfied by such
Permitted Transferees, may cause such repayment obligation to be satisfied by
such Permitted Transferees.
(g) Change in Control. Except as otherwise may be provided in the Letter
Agreement, the following provisions shall apply in the event of a Change in
Control (as defined in the Letter Agreement):
(i) If, within one year following a Change in Control, the Grantee's
employment with the Company terminates in a "qualifying termination" (as
defined below), all restrictions applicable to such Restricted Stock then
held by the Grantee (or his legatees, personal representative or Permitted
Transferees, as applicable) shall immediately lapse as of the date of such
termination; provided, however, that in the event the Grantee's employment
is terminated without Cause by the Company (other than upon death or due
to Disability) or the Grantee resigns for Good Reason (other than due to
Disability), in both cases within one year following a Change in Control
during the Term of the Letter Agreement, this Award shall be treated in
accordance with paragraph 8(d) of the Letter Agreement.
(ii) If there shall occur a Change in Control pursuant to which this
Restricted Stock Award is not to be assumed, then all restrictions
applicable to such Restricted Stock then held by the Grantee (or his
legatees, personal representative or Permitted Transferees, as applicable)
shall immediately lapse as of immediately prior to such Change in Control.
(iii) For purposes of this Agreement, a "qualifying termination" shall
mean a termination of the Grantee's employment or service by the Company
other than for Cause or by the Grantee for Good Reason (other than due to
a Disability). .
(h) Income Taxes. The Grantee shall pay to the Company promptly upon
request, and in any event at the time the Grantee recognizes taxable income in
respect of the Restricted Stock (or, if the Grantee makes an election under
Section 83(b) of the Code, in connection with such grant), an amount equal to
the taxes the Company determines it is required to withhold under applicable tax
laws with respect to the Restricted Stock. Such payment shall be made in the
form of cash, Shares already owned by the Grantee which were acquired more than
six months prior to the date of surrender under this Section 2(h), Shares
otherwise issuable upon the lapse of restric-
Mr. Lawrence Rutkowski
September 11, 2003
Page 21
tions, or in a combination of such methods. The Grantee shall promptly notify
the Company of any election made pursuant to Section 83(b) of the Code.
Section 3. Miscellaneous
(a) Notices. Any and all notices, designations, consents, offers,
acceptances and any other communications provided for herein shall be given in
writing and shall be delivered either personally or by registered or certified
mail, postage prepaid, which shall be addressed, in the case of the Company to
the General Counsel of the Company at the principal office of the Company and,
in the case of the Grantee, to Grantee's address appearing on the books of the
Company or to the Grantee's residence or to such other address as may be
designated in writing by the Grantee.
(b) No Right to Continued Employment. Nothing in the Plan or in this
Agreement shall confer upon the Grantee any right to continue in the employ of
the Company or any subsidiary or shall interfere with or restrict in any way the
right of the Company and its subsidiaries, which is hereby expressly reserved,
to remove, terminate or discharge the Grantee at any time for any reason
whatsoever, with or without Cause.
(c) Bound by Plan. By signing this Agreement, the Grantee acknowledges
that he has received a copy of the Plan and has had an opportunity to review the
Plan and agrees to be bound by all the terms and provisions of the Plan
including, but not limited to, Section 11(l) thereof (relating to compliance
with applicable law and regulations).
(d) Successors. The terms of this Agreement shall be binding upon and
inure to the benefit of the Company, its successors and assigns, and of the
Grantee and the beneficiaries, executors, administrators, heirs and successors
of the Grantee.
(e) Invalid Provision. The invalidity or unenforceability of any
particular provision thereof shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provision had been omitted.
(f) Modifications. No change, modification or waiver of any provision of
this Agreement shall be valid unless the same be in writing and signed by the
parties hereto.
(g) Entire Agreement. This Agreement and the Plan contain the entire
agreement and understanding of the parties hereto with respect to the subject
matter contained herein and therein and supersede all prior communications,
representations and negotiations in respect thereto.
(h) Governing Law. This Agreement and the rights of the Grantee hereunder
shall be construed and determined in accordance with the laws of the State of
Delaware.
Mr. Lawrence Rutkowski
September 11, 2003
Page 22
(i) Headings. The headings of the Sections hereof are provided for
convenience only and are not to serve as a basis for interpretation or
construction, and shall not constitute a part, of this Agreement.
(j) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, this Agreement has been executed and delivered by
the parties hereto as of the 11th day of September, 2003.
THE WARNACO GROUP, INC.
By: /s/ Jay A. Galluzzo
--------------------
Its: Vice President, General Counsel & Secretary
-------------------------------------------
LAWRENCE RUTKOWSKI
Signature: /s/ Lawrence Rutkowski
----------------------
Printed Name:
-------------------
Address:
------------------------
------------------------
Mr. Lawrence Rutkowski
September 11, 2003
Page 23
Exhibit C
THE WARNACO GROUP, INC.
2003 STOCK INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the "Agreement"), dated as of
September 11, 2003, is made by and between The Warnaco Group, Inc., a Delaware
corporation (the "Company"), and Lawrence Rutkowski, an employee of the Company
(the "Optionee").
WHEREAS, the Company has adopted The Warnaco Group, Inc. 2003 Stock
Incentive Plan (the "Plan"), pursuant to which options may be granted to
purchase Shares;
WHEREAS, the Company desires to grant to the Optionee a Non-Qualified
Stock Option to purchase the number of Shares provided for herein;
NOW, THEREFORE, in consideration of the recitals and the mutual agreements
herein contained, the parties hereto agree as follows:
Section 1. Grant of Option
(a) Grant of Option. The Company hereby grants to the Optionee an Option
to purchase 200,000 Shares on the terms and conditions set forth in this
Agreement and as otherwise provided in the Plan (the "Option"). The Option is
not intended to be treated, and shall not be construed, as an Incentive Stock
Option.
(b) Incorporation of Plan. The provisions of the Plan are hereby
incorporated herein by reference. Except as otherwise expressly set forth
herein, this Agreement shall be construed in accordance with the provisions of
the Plan and any capitalized terms not otherwise defined in this Agreement shall
have the definitions set forth in the Plan; provided, however, that for purposes
of paragraphs 2(e), 2(f) and 2(g) below, the capitalized terms "Cause," "Change
in Control," "Disability" and "Good Reason" shall have the meanings ascribed to
them in that certain letter agreement ("Letter Agreement"), dated September 11,
2003, between the Company and the Grantee. The Committee shall have final
authority to interpret and construe the Plan and this Agreement and to make any
and all determinations under them, and its decision shall be binding and
conclusive upon the Optionee and his legal representative in respect of any
questions arising under the Plan or this Agreement.
Section 2. Terms and Conditions of Option
(a) Exercise Price. The price at which the Optionee shall be entitled to
purchase Shares upon the exercise of all or any portion of the Option shall be
$16.75 per Share.
Mr. Lawrence Rutkowski
September 11, 2003
Page 24
(b) Expiration Date. The Option shall expire at the close of business on
the tenth anniversary of the date of this Agreement.
(c) Exercisability of Option. Subject to the other terms of this Agreement
regarding the exercisability of the Option, the Option shall become exercisable
as of the dates set forth below for the cumulative percentages of Shares set
forth below, provided the Optionee is employed by or providing services to the
Company as of each such date and has not given the Company written notice that
he is voluntarily resigning on or prior to such date:
Date Percentage of Shares
---- --------------------
February 29, 2004 25%
February 28, 2005 25%
February 28, 2006 25%
February 28, 2007 25%
The Committee may, but shall not be required to, provide at any time for the
acceleration of the schedule set forth above.
(d) Method of Exercise. The Option may be exercised only by written notice
in the form attached hereto as Exhibit A delivered in person or by mail in
accordance with Section 3(a) hereof and accompanied by payment therefor. The
purchase price of the Shares shall be paid to the Company (i) in cash or its
equivalent, (ii) by tendering to the Company Shares already owned by the
Optionee, which, in the case of Shares purchased by the Optionee pursuant to the
exercise of an option granted by the Company, have been held by the Optionee for
no less than six months following the date of such purchase, in any case having
a total Fair Market Value less than or equal to the aggregate purchase price,
(iii) to the extent permitted by law, by a "cashless exercise" procedure
approved by the Committee, or (iv) by a combination of the foregoing methods. If
requested by the Committee, the Optionee shall deliver this Agreement evidencing
the Option to the Secretary of the Company who shall endorse thereon a notation
of such exercise and return such Agreement to the Optionee. A minimum of 100
Shares must be purchased upon the exercise of the Option unless a lesser number
of Shares so purchased constitutes the total number of Shares then purchasable
under the Option.
(e) Termination of Employment. Except as otherwise provided in the Letter
Agreement, in the event that the Optionee ceases to be employed by or provide
services to the Company or has given the Company written notice that he is
voluntarily resigning, that portion of the Option that is not then exercisable
shall immediately terminate and that portion of the Option that is exercisable
at the time of the Optionee's termination of employment or service or written
notice of voluntary resignation shall terminate as follows:
(i) If the Optionee's termination of employment or service is due to
his death or Disability, the Option (to the extent exercisable at the time
of the Optionee's termination of employment) shall be exercisable for a
period of one year following such
Mr. Lawrence Rutkowski
September 11, 2003
Page 25
termination of employment, and shall thereafter terminate;
(ii) If the Optionee's termination of employment or service is by the
Company for Cause, the Option shall terminate on the date of the
Optionee's termination of employment;
(iii) If the Optionee voluntarily terminates his employment or service
(other than by retirement) or provides written notice to the Company that
he is voluntarily resigning, the Option (to the extent exercisable at the
time of the Optionee's termination or written notice of voluntary
resignation) shall be exercisable for a period of one month following such
termination of employment or written notice of voluntary resignation, and
shall thereafter terminate; and
(iv) If the Optionee's termination of employment or service is for any
other reason (including the Optionee's ceasing to be employed by an
Affiliate as a result of the sale of such Affiliate or an interest in such
Affiliate), the Option (to the extent exercisable at the time of the
Optionee's termination of employment) shall be exercisable for a period of
three months following such termination of employment, and shall
thereafter terminate.
Notwithstanding the foregoing, (x) the Committee may, but shall not be required
to, provide at any time that the Option may be exercised after the periods
provided for in this Section 2(e), but in no event beyond the term of the Option
set forth in Section 2(b), and (y) no provision in this Section 2(e) shall
extend the exercise period of an Option beyond its original term set forth in
Section 2(b).
(f) Additional Forfeiture upon Termination for Cause. In addition to the
cancellation of the Option as provided in Section 2(e), if the Optionee's
termination of employment or service is by the Company for Cause, the Optionee
shall sell back to the Company any Shares purchased by the Optionee during the
six-month period immediately prior to the effective date of such termination
pursuant to the exercise of the Option. If the Optionee is required to sell back
any Shares pursuant to this Section 2(f), the purchase price to be paid by the
Company for such Shares shall be at the aggregate exercise price paid by the
Optionee for such Shares. To the extent the Shares subject to this Section 2(f)
have been previously sold or otherwise disposed of by the Optionee, the Optionee
shall repay to the Company the difference between the aggregate fair market
value of such Shares on the date of such sale or disposition and the exercise
price; provided, however, that to the extent such Shares have been previously
sold or otherwise disposed of to a Permitted Transferee, the Optionee, without
being relieved of the repayment obligation to be satisfied by such Permitted
Transferees, may cause such repayment obligation to be satisfied by such
Permitted Transferees.
(g) Nontransferability. The Option shall not be transferable by the Optionee
other than (i) by will or the laws of descent and distribution, (ii) to a
Permitted Transferee or (iii) pursuant to the terms of a qualified domestic
relations order ("QDRO"), as determined by the Committee, and may be exercised
during the lifetime of the Optionee only by the Optionee or his guardian or
legal representative or by a transferee under such a QDRO.
Mr. Lawrence Rutkowski
September 11, 2003
Page 26
(h) Change in Control. Except as otherwise may be provided in the Letter
Agreement, the following provisions shall apply in the event of a Change in
Control as defined in the Letter Agreement:
(i) If, within one year following a Change in Control, the Optionee's
employment or service with the Company terminates in a "qualifying
termination" (as defined below), the Option shall become immediately
exercisable in full as of the date of such termination and shall remain
exercisable until the first to occur of six months following such
termination and the expiration of the term; provided, however, that in the
event the Optionee's employment is terminated without Cause (as defined in
Exhibit A to the Letter Agreement) by the Company (other than upon death
or due to Disability) or the Optionee resigns for Good Reason (other than
due to Disability), in both cases within one year following a Change in
Control during the Term of the Letter Agreement, the Option shall be
treated in accordance with paragraph 8(d) of the Letter Agreement.
(ii) If there shall occur a Change in Control pursuant to which the Option
is not to be assumed, then, the Option shall become fully exercisable as
of immediately prior to such Change in Control.
(iii) For purposes of this Agreement, a "qualifying termination" shall
mean a termination of the Optionee's employment or service by the Company
other than for Cause or by the Optionee for Good Reason (other than due to
Disability).
(i) Rights as a Stockholder. The Optionee shall not be deemed for any purpose to
be the owner of any Shares subject to the Option unless, until and to the extent
that (i) the Option shall have been exercised pursuant to its terms, (ii) the
Company shall have issued and delivered to the Optionee the Shares for which the
Option shall have been exercised, and (iii) the Optionee's name shall have been
entered as a stockholder of record with respect to such Shares on the books of
the Company.
(j) Income Taxes. The Company may, in its discretion, require that the Optionee
pay to the Company at or after (as determined by the Committee) the time of
exercise of any portion of the Option any such additional amount as the Company
deems necessary to satisfy its liability to withhold federal, state or local
income tax or any other taxes incurred by reason of the exercise or the transfer
of Shares thereupon.
Section 3. Miscellaneous
(a) Notices. Any and all notices, designations, consents, offers, acceptances
and any other communications provided for herein shall be given in writing and
shall be delivered either personally or by registered or certified mail, postage
prepaid, which shall be addressed, in the case of the Company to the General
Counsel of the Company at the principal office of the Company and, in the case
of the Optionee, to Optionee's address appearing on the books of the Company or
to Optionee's residence or to such other address as may be designated in writing
by the Optionee.
Mr. Lawrence Rutkowski
September 11, 2003
Page 27
(b) No Right to Continued Employment. Nothing in the Plan or in this Agreement
shall confer upon the Optionee any right to continue in the employ of the
Company or shall interfere with or restrict in any way the right of the Company,
which are hereby expressly reserved, to remove, terminate or discharge the
Optionee at any time for any reason whatsoever, with or without Cause.
(c) Bound by Plan. By signing this Agreement, the Optionee acknowledges that he
has received a copy of the Plan and has had an opportunity to review the Plan
and agrees to be bound by all the terms and provisions of the Plan including,
but not limited to, section 11(l) thereof (relating to compliance with
applicable law and regulations).
(d) Successors. The terms of this Agreement shall be binding upon and inure to
the benefit of the Company, its successors and assigns, and of the Optionee and
the beneficiaries, executors, administrators, heirs and successors of the
Optionee.
(e) Validity/Invalidity. The invalidity or unenforceability of any particular
provision hereof shall not affect the other provisions hereof, and this
Agreement shall be construed in all respects as if such invalid or unenforceable
provision had been omitted.
(f) Modifications. No change, modification or waiver of any provision of this
Agreement shall be valid unless the same be in writing and signed by the parties
hereto.
(g) Entire Agreement. This Agreement and the Plan contain the entire agreement
and understanding of the parties hereto with respect to the subject matter
contained herein and therein and supersede all prior communications,
representations and negotiations in respect thereto.
(h) Governing Law. This Agreement and the rights of the Optionee hereunder shall
be construed and determined in accordance with the laws of the State of
Delaware.
(i) Headings. The headings of the Sections hereof are provided for convenience
only and are not to serve as a basis for interpretation or construction, and
shall not constitute a part, of this Agreement.
(j) Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
Mr. Lawrence Rutkowski
September 11, 2003
Page 28
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto on the 11th day of September, 2003.
THE WARNACO GROUP, INC.
By: /s/ Jay A. Galluzzo
-------------------
Its Vice President, General Counsel & Secretary
-------------------------------------------
LAWRENCE RUTKOWSKI
Signature: /s/ Lawrence Rutkowski
----------------------
Address:
------------------------
---------------------------------