UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 19, 2005
LIZ CLAIBORNE, INC.
(Exact name of registrant as specified in its charter)
Delaware 001-10689 13-2842791
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(State or other (Commission file number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation)
1441 BROADWAY, NEW YORK, NEW YORK, 10018
(Address of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code: (212) 354-4900
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
APPROVAL OF THE LIZ CLAIBORNE, INC. SECTION 162(m) LONG TERM PERFORMANCE PLAN
On May 19, 2005, the stockholders of Liz Claiborne, Inc. (the "Company")
approved the Liz Claiborne, Inc. Section 162(m) Long Term Performance Plan (the
"Performance Plan") at the Company's Annual Meeting of Stockholders. The
Performance Plan provides for cash awards to be granted upon the achievement of
specified performance goals during a performance period with such goals to be
established by the Compensation Committee of the Board of Directors of the
Company. Performance goals may be expressed in terms of one or more of the
following criteria: (a) earnings; (b) sales; (c) cash flow(s); (d) financial
return ratios; (e) shareholder return, including share price or share price
appreciation; (f) value of assets, return on assets, net assets or capital; (g)
adjusted pre-tax margin; (h) margins, profits and expense levels; (i) dividends;
(j) market share or market penetration; (k) reduction of losses; (l) costs; (m)
debt reduction; (n) productivity improvements; (o) inventory turnover
measurements; or (p) customer satisfaction. Performance goals may be expressed
(1) with respect to the Company as a whole or with respect to one or more
divisions or business units, (2) on a pre-tax or after-tax basis, and (3) on an
absolute and/or relative basis. In addition, performance goals may employ
comparisons with past performance of the Company (including one or more
divisions) and/or the current or past performance of other companies, and in the
case of earnings-based measures, may employ comparisons to capital,
stockholders' equity and shares outstanding. Approximately 30 persons are
eligible to participate in the Performance Plan. The foregoing summary of the
Performance Plan is qualified in its entirety by reference to the full text of
the Performance Plan, which is filed as Exhibit 10.1(a) to this Form 8-K.
Subject to stockholder approval of the Performance Plan, initial awards under
the Performance Plan have been granted to a number of key executives, including
the Company's executive officers other than the Company's Chairman and Chief
Executive Officer. Such awards provide for a three-year performance period
covering the Company's 2005, 2006 and 2007 fiscal years, with actual payouts
dependent on the level of achievement of three performance goals: 25% of each
Award payout is based on the Company's earnings per share growth, 25% is based
on the Company's average three-year return on invested capital and 50% is based
on total shareholder return as compared to a group of peer companies. The
following table sets forth the target value of the initial Performance Plan
awards made to the Company's executive officers (note that depending on the
level of achievement of the performance goals, actual amounts may range from 0
(for a below threshold level of achievement) to 200% of target value (for a
maximum level of achievement)):
NAME AND TITLE TARGET VALUE ($)
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Angela J. Ahrendts, Executive Vice President $ 2,700,000
Lawrence D. McClure, Senior Vice President, Human Resources $ 1,350,000
Michael Scarpa, Senior Vice President, Finance & Distribution, and Chief
Financial Officer $ 1,350,000
Trudy R. Sullivan, Executive Vice President $ 2,700,000
John Sullivan, Senior Vice President, Sourcing, Service and Systems, and
Chief Information Officer $ 1,350,000
APPROVAL OF THE LIZ CLAIBORNE, INC. 2005 STOCK INCENTIVE PLAN
On May 19, 2005, the Company's stockholders approved the Liz Claiborne, Inc.
2005 Stock Incentive Plan (the "2005 Stock Plan"). The 2005 Stock Plan provides
for the grant of stock options, stock appreciation rights, shares of restricted
stock, restricted stock units, shares of unrestricted stock, performance shares
and dividend equivalent rights. A maximum of 5,000,000 shares of common stock
are available for grants pursuant to awards under the 2005 Stock Plan. The
foregoing summary of the 2005 Stock Plan is qualified in its entirety by
reference to the full text of the 2005 Stock Plan, which is filed as Exhibit
10.1(b) to this Form 8-K. To date, no awards have been granted from the 2005
Stock Plan.
ITEM 8.01. OTHER EVENTS.
On May 19, 2005, the Company's stockholders elected the following three Director
nominees named in the Company's 2005 Proxy Statement, each of whom previously
served as a Director:
Paul R. Charron
Kay Koplovitz
Oliver R. Sockwell
In addition, the stockholders ratified the appointment of Deloitte & Touche LLP
as the Company's independent registered public accounting firm for the 2005
fiscal year.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
10.1(a) Liz Claiborne, Inc. Section 162(m) Long Term Performance Plan.
10.1(b) Liz Claiborne, Inc. 2005 Stock Incentive Plan.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LIZ CLAIBORNE, INC.
Dated: May 25, 2005 By: /s/ Nicholas Rubino
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Name: Nicholas Rubino
Title: Vice President, Deputy General
Counsel and Secretary
EXHIBIT LISTING
Exhibit No. Description
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10.1(a) Liz Claiborne, Inc. Section 162(m) Long Term Performance Plan
10.1(b) Liz Claiborne, Inc. 2005 Stock Incentive Plan