As filed with the Securities and Exchange Commission on December 15, 1997.
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TOMMY HILFIGER CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
British Virgin Islands Not Applicable
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
6/F Precious Industrial Centre
18 Cheung Yue Street
Cheung Sha Wan, Kowloon
Hong Kong
(Address of Principal Executive Offices)
TOMMY HILFIGER U.S.A.
1992 STOCK INCENTIVE PLAN
AND
TOMMY HILFIGER (EASTERN HEMISPHERE) LIMITED
1992 STOCK INCENTIVE PLAN
(Full Title of the Plans)
Mr. Joel J. Horowitz
Chief Executive Officer
Tommy Hilfiger U.S.A., Inc.
25 West 39th Street
New York, New York 10018
(212) 840-8888
(Name, Address and Telephone Number of Agent for Service)
Copy to:
Eric S. Robinson, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
(212) 403-1000
<PAGE>
<TABLE>
CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION> PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED BE REGISTERED(1) PER SHARE(2) OFFERING PRICE(2) REGISTRATION FEE
- ------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Ordinary Shares, par
value $.01 per share 750,000 shares $41.09375 $30,820,312.50 $9,340
(1) Plus such indeterminate number of shares as may be
issued to prevent dilution resulting from stock splits,
stock dividends or similar transactions in accordance
with Rule 416 under the Securities Act of 1933.
(2) Pursuant to Rule 457(h) and Rule 457(c) under the
Securities Act of 1933, the proposed maximum offering
price per share and the registration fee are based on
the reported average of the high and low prices for the
Registrant's Ordinary Shares on the New York Stock Ex-
change on December 11, 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
This Registration Statement is being filed pursuant to General Instruction E of
Form S-8 in order to register additional securities of the same class as other
securities for which a registration statement on this form relating to the same
employee benefit plans is effective. <PAGE>
On December 14, 1995, the Registrant filed a registration
statement on Form S-8 (File No. 33-80439) to register 1,000,000
Ordinary Shares, par value $.01 per share ("Ordinary Shares"),
which were issuable under the Registrant's stock incentive
plans. On February 3, 1997, the Registrant filed a registra-
tion statement on Form S-8 (File No. 333-20993) to register an
additional 500,000 Ordinary Shares under the stock incentive
plans. The contents of those registration statements are in-
corporated herein by reference. The Registrant is filing this
separate Registration Statement to register an additional
750,000 Ordinary Shares which may be issued under the stock in-
centive plans.
ITEM 8. EXHIBITS.
Exhibit Number Description
4.1 Tommy Hilfiger U.S.A. 1992 Stock Incen-
tive Plan, as amended and restated
4.2 Tommy Hilfiger (Eastern Hemisphere)
Limited 1992 Stock Incentive Plan, as
amended and restated
5 Opinion of Harney, Westwood & Riegels
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Harney, Westwood & Riegels
(included in their opinion filed as Ex-
hibit 5)<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act
of 1933, the Registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration State-
ment to be signed on its behalf by the undersigned, thereunto
duly authorized, in New York, New York, on December 15, 1997.
TOMMY HILFIGER CORPORATION
By:/S/ JOEL J. HOROWITZ
Joel J. Horowitz
Chief Executive Officer
and President
Pursuant to the requirements of the Securities Act
of 1933, this Registration Statement has been signed by the
following persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
/S/ SILAS K.F. CHOU Chairman of the Board December 15, 1997
(Silas K.F. Chou)
/S/ THOMAS J. HILFIGER Director and Honorary December 15, 1997
(Thomas J. Hilfiger) Chairman of the Board
/S/ JOEL J. HOROWITZ Director, Chief December 15, 1997
(Joel J. Horowitz) Executive Officer and
President (principal
executive officer)<PAGE>
/S/ BENJAMIN M.T. NG Director, Executive December 15, 1997
(Benjamin M.T. Ng) Vice President --
Corporate Finance
and Assistant
Secretary (principal
financial officer)
/S/ LAWRENCE S. STROLL Director December 15, 1997
(Lawrence S. Stroll)
/S/ RONALD K.Y. CHAO Director December 15, 1997
(Ronald K.Y. Chao)
/S/ LESTER M.Y. MA Director December 15, 1997
(Lester M.Y. Ma)
/S/ JOSEPH M. ADAMKO Director December 15, 1997
(Joseph M. Adamko)
/S/ CLINTON V. SILVER Director December 15, 1997
(Clinton V. Silver)
/S/ SIMON MURRAY Director December 15, 1997
(Simon Murray)
/S/ JOSEPH SCIROCCO Senior Vice President December 15, 1997
(Joseph Scirocco) and Treasurer
(principal accounting
officer) <PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
4.1 Tommy Hilfiger U.S.A. 1992 Stock
Incentive Plan, as amended and
restated
4.2 Tommy Hilfiger (Eastern Hemisphere) Limited
1992 Stock Incentive Plan, as
amended and restated
5 Opinion of Harney, Westwood & Riegels
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Harney, Westwood & Riegels
(Included in their opinion filed as
Exhibit 5)
EXHIBIT 4.1
TOMMY HILFIGER U.S.A.
1992 STOCK INCENTIVE PLAN
(Restated to Incorporate All Amendments
through October 27, 1997 and the Effects of the
December 27, 1994 Two-for-One Stock Split)<PAGE>
SECTION 1. PURPOSE; DEFINITIONS.
The purpose of the Plan is to give the Company and its
Affiliates a significant advantage in attracting, retaining and
motivating officers, employees and directors and to provide the
Company and its subsidiaries with the ability to provide
incentives more directly linked to the profitability of the
Company's businesses and increases in stockholder value.
For purposes of the Plan, the following terms are
defined as set forth below:
a. "Affiliate" means a corporation or other entity
controlled by or in control of the Company and designated by the
Committee as such.
b. "Award" means a Stock Appreciation Right, Stock
Option or Restricted Stock.
c. "Board" means the Board of Directors of the
Company.
d. "Cause" has the meaning set forth in Section 5(i).
e. "Code" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor thereto.
f. "Committee" means the Committee referred to in
Section 2.
g. "Company" means Tommy Hilfiger U.S.A., Inc., a
Delaware corporation.
h. "Disability" means permanent and total disability
as determined under procedures established by the Committee for
purposes of the Plan.
i. "Fair Market Value" means, as of any given date,
the mean between the highest and lowest reported sales prices of
the Stock on the New York Stock Exchange Composite Tape or, if not
listed on such exchange, on any other national securities exchange
on which the Stock is listed or on NASDAQ. If there is no regular
public trading market for such Stock, the Fair Market Value of the
Stock shall be determined by the Committee in good faith.
j. "Incentive Stock Option" means any Stock Option
intended to be and designated as an "incentive stock option"
within the meaning of Section 422 of the Code.
-1-<PAGE>
k. "Non-Qualified Stock Option" means any Stock Option
that is not an Incentive Stock Option.
l. "Plan" means the Tommy Hilfiger U.S.A. 1992 Stock
Incentive Plan, As Amended, as set forth herein and as hereinafter
amended from time to time.
m. "Restricted Stock" means an award granted under
Section 7.
n. "Retirement" means retirement from active
employment under a pension plan of the Company, any subsidiary or
Affiliate, or under an employment contract with any of them, or
termination of employment at or after age 55 under circumstances
which the Committee, in its sole discretion, deems equivalent to
retirement.
o. "Stock" means the Ordinary Shares, par value $0.01
per share, of Tommy Hilfiger Corporation, a British Virgin Islands
corporation.
p. "Stock Appreciation Right" means a right granted
under Section 6.
q. "Stock Option" means an option granted under
Section 5.
r. "Termination of Employment" means the termination
of the participant's employment with the Company and any
subsidiary or Affiliate. A participant employed by a subsidiary
or an Affiliate shall also be deemed to incur a Termination of
Employment if the subsidiary or Affiliate ceases to be such a
subsidiary or Affiliate, as the case may be, and the participant
does not immediately thereafter become an employee of the Company
or another subsidiary or Affiliate.
In addition, certain other terms used herein have
definitions given to them in the first place in which they are
used.
SECTION 2. ADMINISTRATION.
The Plan shall be administered by the Compensation
Committee of the Board. If at any time no Committee shall be in
office, the functions of the Committee specified in the Plan shall
be exercised by the Board.
-2-<PAGE>
The Committee shall have plenary authority to grant
Awards pursuant to the terms of the Plan to officers, employees
and directors of the Company and its subsidiaries and Affiliates.
Among other things, the Committee shall have the
authority, subject to the terms of the Plan:
(a) subject to Section 4, to select the officers,
employees and directors to whom Awards may from time to time be
granted;
(b) to determine whether and to what extent Incentive
Stock Options, Non-Qualified Stock Options, Stock Appreciation
Rights and Restricted Stock or any combination thereof are to be
granted hereunder;
(c) to determine the number of shares of Stock to be
covered by each Award granted hereunder;
(d) to determine the terms and conditions of any Award
granted hereunder (including, but not limited to, the option price
(subject to Section 5(a)), any vesting restriction or limitation
and any vesting acceleration or forfeiture waiver regarding any
Award and the shares of Stock relating thereto, based on such
factors as the Committee shall determine);
(e) to modify, amend or adjust the terms and conditions
of any Award, at any time or from time to time, including, but not
limited to, with respect to performance goals and measurements
applicable to performance-based Awards pursuant to the terms of
the Plan;
(f) to determine to what extent and under what
circumstances Stock and other amounts payable with respect to an
Award shall be deferred; and
(g) to determine under what circumstances a Stock
Option may be settled in cash or Stock under Section 5(j).
The Committee shall have the authority to adopt, alter
and repeal such administrative rules, guidelines and practices
governing the Plan as it shall, from time to time, deem advisable,
to interpret the terms and provisions of the Plan and any Award
issued under the Plan (and any agreement relating thereto) and to
otherwise supervise the administration of the Plan.
-3-<PAGE>
Any determination made by the Committee or pursuant to
delegated authority pursuant to the provisions of the Plan with
respect to any Award shall be made in the sole discretion of the
Committee or such delegate at the time of the grant of the Award
or, unless in contravention of any express term of the Plan, at
any time thereafter. All decisions made by the Committee or any
appropriately delegated officer pursuant to the provisions of the
Plan shall be final and binding on all persons, including the
Company and Plan participants.
SECTION 3. STOCK SUBJECT TO PLAN.
Subject to adjustment as provided herein, the total
number of shares of Stock available for grant under the Plan shall
be 6,220,000 shares of Stock, less the number of shares of Stock
which have been made the subject of an Award under the Tommy
Hilfiger (Far East) Limited 1992 Stock Incentive Plan, As Amended.
Shares of Stock subject to an Award under the Plan may be
authorized and unissued shares or may be treasury shares.
If any shares of Restricted Stock are forfeited for
which the participant did not receive any benefits of ownership
(as such phrase is construed by the Commission or its Staff), or
if any Stock Option (and related Stock Appreciation Right, if
any) terminates without being exercised, or if any Stock
Appreciation Right is exercised for cash, shares subject to such
Awards shall again be available for distribution in connection
with Awards under the Plan.
In the event of any merger, reorganization,
consolidation, recapitalization, stock dividend, stock split,
extraordinary distribution with respect to the Stock or other
change in corporate structure affecting the Stock, the Committee
or Board may make such substitution or adjustments in the
aggregate number and kind of shares reserved for issuance under
the Plan, in the number, kind and option price of shares subject
to outstanding Stock Options and Stock Appreciation Rights, in the
number and kind of shares subject to other outstanding Awards
granted under the Plan and/or such other substitution or
adjustments in the consideration receivable upon exercise as it
may determine to be appropriate in its sole discretion; provided,
however, that the number of shares subject to any Award shall
always be a whole number. Such adjusted option price shall also
be used to determine the amount payable by
-4-<PAGE>
the Company upon the exercise of any Stock Appreciation Right
associated with any Stock Option.
SECTION 4. ELIGIBILITY.
Officers, employees and directors of the Company, its
subsidiaries and Affiliates who are responsible for or contribute
to the management, growth and profitability of the business of the
Company, its subsidiaries and Affiliates are eligible to be
granted Awards under the Plan. No grant shall be made to Thomas
J. Hilfiger, Joel J. Horowitz, Silas K.F. Chou, Ronald K.Y. Chao,
Lawrence S. Stroll or Edwin H. Lewis, other than the grant to
Edwin H. Lewis of one Stock Option to acquire 760,000 shares of
Stock.
SECTION 5. STOCK OPTIONS.
Stock Options may be granted alone or in addition to
other Awards granted under the Plan and may be of two types:
Incentive Stock Options and Non-Qualified Stock Options. Any
Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.
The Committee shall have the authority to grant any
optionee Incentive Stock Options, Non-Qualified Stock Options or
both types of Stock Options (in each case with or without Stock
Appreciation Rights). Incentive Stock Options may be granted only
to employees of the Company and its subsidiaries (within the
meaning of Section 424(f) of the Code). To the extent that any
Stock Option is not designated as an Incentive Stock Option or
even if so designated does not qualify as an Incentive Stock
Option, it shall constitute a Non-Qualified Stock Option.
Stock Options shall be evidenced by option agreements,
the terms and provisions of which may differ. An option agreement
shall indicate on its face whether it is intended to be an
agreement for an Incentive Stock Option or a Non-Qualified Stock
Option. The grant of a Stock Option shall occur on the date the
Committee by resolution selects an individual to be a participant
in any grant of a Stock Option, determines the number of shares
of Stock to be subject to such Stock Option to be granted
to such individual and specifies the terms and provisions of the
Stock Option. The Company shall notify a participant of any grant
of a Stock Option, and a written option agreement or
-5-<PAGE>
agreements shall be duly executed and delivered by the Company to
the participant.
Anything in the Plan to the contrary notwithstanding, no
term of the Plan relating to Incentive Stock Options shall be
interpreted, amended or altered nor shall any discretion or
authority granted under the Plan be exercised so as to disqualify
the Plan under Section 422 of the Code or, without the consent of
the optionee affected, to disqualify any Incentive Stock Option
under such Section 422.
Stock Options granted under the Plan shall be subject to
the following terms and conditions and shall contain such
additional terms and conditions as the Committee shall deem
desirable:
(a) Option Price. The option price per share of Stock
purchasable under a Stock Option shall be determined by the
Committee and set forth in the option agreement, and shall not be
less than the Fair Market Value of the Stock subject to the Stock
Option on the date of grant.
(b) Option Term. The term of each Stock Option shall be
fixed by the Committee, but no Stock Option shall be exercisable
more than 15 years after the date the Stock Option is granted.
(c) Exercisability. Except as otherwise provided
herein, Stock Options shall be exercisable at such time or times
and subject to such terms and conditions as shall be determined by
the Committee. If the Committee provides that any Stock Option is
exercisable only in installments, the Committee may at any time
waive such installment exercise provisions, in whole or in part,
based on such factors as the Committee may determine. In
addition, the Committee may at any time, in whole or in
part, accelerate the exercisability of any Stock Option.
(d) Method of Exercise. Subject to the provisions of
this Section 5, Stock Options may be exercised, in whole or in
part, at any time during the option term by giving written notice
of exercise to the Company specifying the number of shares of
Stock subject to the Stock Option to be purchased.
The option price of Stock to be purchased upon exercise
of any Option shall be paid in full in cash (by certified or bank
check or such other instrument as the Company may accept) or, if
and to the extent set forth in the option agreement, may also be
paid by one or more of the
-6-<PAGE>
following: (i) in the form of unrestricted Stock already owned
by the optionee (and, in the case of the exercise of a Non-
Qualified Stock Option, Restricted Stock subject to an Award
hereunder) based in any such instance on the Fair Market Value of
the Stock on the date the Stock Option is exercised; provided,
however, that, in the case of an Incentive Stock Option, the right
to make a payment in the form of already owned shares of Stock may
be authorized only at the time the Stock Option is granted; (ii)
by requesting the Company to withhold from the number of shares of
Stock otherwise issuable upon exercise of the Stock Option that
number of shares having an aggregate fair market value on the date
of exercise equal to the exercise price for all of the shares of
Stock subject to such exercise; or (iii) by a combination thereof,
in each case in the manner provided in the option agreement.
In the discretion of the Committee, payment for any
shares subject to a Stock Option may also be made by delivering a
properly executed exercise notice to the Company, together with a
copy of irrevocable instructions to a broker to deliver promptly
to the Company the amount of sale or loan proceeds to pay the
purchase price. To facilitate the foregoing, the Company may
enter into agreements for coordinated procedures with one or more
brokerage firms.
If payment of the option exercise price of a Non-
Qualified Stock Option is made in whole or in part in the form of
Restricted Stock, the number of shares of Stock to be received
upon such exercise equal to the number of shares of Restricted
Stock used for payment of the option exercise price shall be
subject to the same forfeiture restrictions to which such
Restricted Stock was subject, unless otherwise determined by the
Committee.
No shares of Stock shall be issued until full payment
therefor has been made. Subject to any forfeiture restrictions
that may apply if a Stock Option is exercised using Restricted
Stock, an optionee shall have all of the rights of a stockholder
of the Company holding the Stock that is subject to such Stock
Option (including, if applicable, the right to vote the shares and
the right to receive dividends), when the optionee has given
written notice of exercise, has paid in full for such shares and,
if requested, has given the representation described in Section
10(a).
(e) Non-transferability of Stock Options. No Stock
Option shall be transferable by the optionee other
-7-<PAGE>
than (i) by will or by the laws of descent and distribution or
(ii) in the case of a Non-Qualified Stock Option, pursuant to a
qualified domestic relations order (as defined in the Code or
Title I of the Employee Retirement Income Security Act of 1974, as
amended, or the rules thereunder). All Stock Options shall be
exercisable, during the optionee's lifetime, only by the optionee
or by the guardian or legal representative of the optionee or, in
the case of a Non-Qualified Stock Option, its alternate payee
pursuant to such qualified domestic relations order, it being
understood that the terms "holder" and "optionee" include the
guardian and legal representative of the optionee named in the
option agreement and any person to whom an option is transferred
by will or the laws of descent and distribution or, in the case of
a Non-Qualified Stock Option, pursuant to a qualified domestic
relations order.
(f) Termination by Death. If an optionee's employment
terminates by reason of death, any Stock Option held by such
optionee may thereafter be exercised, to the extent then
exercisable, or on such accelerated basis as the Committee may
determine, for a period of one year (or such other period as the
Committee may specify in the option agreement) from the date of
such death or until the expiration of the stated term of such
Stock Option, whichever period is the shorter. In the event of
termination of employment due to death, if an Incentive Stock
Option is exercised after the expiration of the exercise periods
that apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock Option.
(g) Termination by Reason of Disability. If an
optionee's employment terminates by reason of Disability, any
Stock Option held by such optionee may thereafter be exercised by
the optionee, to the extent it was exercisable at the time of
termination, or on such accelerated basis as the Committee may
determine, for a period of one year (or such shorter period as the
Committee may specify in the option agreement) from the date of
such termination of employment or until the expiration of the
stated term of such Stock Option, whichever period is the
shorter; provided, however, that if the optionee dies within such
one-year period (or such shorter period), any unexercised Stock
Option held by such optionee shall, notwithstanding the expiration
of such three-year (or such shorter) period, continue to be
exercisable to the extent to which it was exercisable at the time
of death for a period of 12 months from the date of such death or
until the expiration of the stated term of such Stock Option,
whichever period is the
-8-<PAGE>
shorter. In the event of termination of employment by reason of
Disability, if an Incentive Stock Option is exercised after the
expiration of the exercise periods that apply for purposes of
Section 422 of the Code, such Stock Option will thereafter be
treated as a Non-Qualified Stock Option.
(h) Termination by Reason of Retirement. If an
optionee's employment terminates by reason of Retirement, any
Stock Option held by such optionee may thereafter be exercised by
the optionee, to the extent it was exercisable at the time of such
Retirement or on such accelerated basis as the Committee may
determine, for a period of three years (or such shorter period as
the Committee may specify in the option agreement) from the date
of such termination of employment or until the expiration of the
stated term of such Stock Option, whichever period is the shorter;
provided, however, that if the optionee dies within such three-
year (or such shorter) period, any unexercised Stock Option held
by such optionee shall, notwithstanding the expiration of such
three-year (or such shorter) period, continue to be exercisable to
the extent to which it was exercisable at the time of death for a
period of 12 months from the date of such death or until the
expiration of the stated term of such Stock Option, whichever
period is the shorter. In the event of termination of employment
by reason of Retirement, if an Incentive Stock Option is exercised
after the expiration of the exercise periods that apply for
purposes of Section 422 of the Code, such Stock Option will
thereafter be treated as a Non-Qualified Stock Option.
(i) Other Termination. Unless otherwise determined by
the Committee, if an optionee incurs a Termination of Employment
for any reason other than death, Disability or Retirement, any
Stock Option held by such Optionee shall thereupon terminate,
except that such Stock Option, to the extent then exercisable, or
on such accelerated basis as the Committee may determine, may be
exercised for the lesser of three months from the date of such
Termination of Employment or the balance of such Stock Option's
term if such Termination of Employment of the optionee is
without Cause; provided, however, that if the optionee dies
within such three-month period, any unexercised Stock
Option held by such optionee shall notwithstanding the
expiration of such three-month period, continue to be exercisable
to the extent to which it was exercisable at the time of death for
a period of 12 months from the date of such death or until the
expiration of the stated term of such Stock Option, whichever
period is the
-9-<PAGE>
shorter. In the event of Termination of Employment for any reason
other than death, Disability or Retirement, if an Incentive Stock
Option is exercised after the expiration of the exercise periods
that apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock Option.
Unless otherwise determined by the Committee, for the purposes of
the Plan "Cause" shall mean (i) the conviction of the optionee
for committing a felony under Federal law or the law of the state
in which such action occurred, (ii) dishonesty in the course of
fulfilling the optionee's employment duties or (iii) willful and
deliberate failure on the part of the optionee to perform his
employment duties in any material respect.
(j) Cashing Out of Stock Option. On receipt of written
notice of exercise, the Committee may elect to cash out all or
part of the portion of the shares of Stock for which a Stock
Option is being exercised by paying the optionee an amount, in
cash or Stock, equal to the excess of the Fair Market Value of the
Stock over the option price times the number of shares of Stock
for which to the Option is being exercised on the effective date
of such cash out.
SECTION 6. STOCK APPRECIATION RIGHTS.
(a) Grant and Exercise. Stock Appreciation Rights
may be granted in conjunction with all or part of any Stock Option
granted under the Plan. In the case of a Non-Qualified Stock
Option, such rights may be granted either at or after the time of
grant of such Stock Option. In the case of an Incentive Stock
Option, such rights may be granted only at the time of grant of
such Stock Option. A Stock Appreciation Right shall terminate and
no longer be exercisable upon the termination or exercise of the
related Stock Option.
A Stock Appreciation Right may be exercised by an
optionee in accordance with Section 6(b) by surrendering the
applicable portion of the related Stock Option in accordance with
procedures established by the Committee. Upon such exercise and
surrender, the optionee shall be entitled to receive an amount
determined in the manner prescribed in Section 6(b). Stock
Options which have been so surrendered shall no longer be
exercisable to the extent the related Stock Appreciation Rights
have been exercised.
(b) Terms and Conditions. Stock Appreciation Rights
shall be subject to such terms and conditions as
-10-<PAGE>
shall be determined by the Committee, including the following:
(i) Stock Appreciation Rights shall be exercisable
only at such time or times and to the extent that the Stock
Options to which they relate are exercisable in accordance
with the provisions of Section 5 and this Section 6.
(ii) Upon the exercise of a Stock Appreciation
Right, an optionee shall be entitled to receive an amount in
cash, shares of Stock or both equal in value to the excess of
the Fair Market Value of one share of Stock over the option
price per share specified in the related Stock Option
multiplied by the number of shares in respect of which the
Stock Appreciation Right shall have been exercised, with the
Committee having the right to determine the form of payment.
(iii) Stock Appreciation Rights shall be
transferable only to permitted transferees of the
underlying Stock Option in accordance with Section 5(e).
SECTION 7. RESTRICTED STOCK.
(a) Administration. Shares of Restricted Stock may be
awarded either alone or in addition to other Awards granted under
the Plan. The Committee shall determine the officers and
employees to whom and the time or times at which grants of
Restricted Stock will be awarded, the number of shares to be
awarded to any participant, the time or times within which such
Awards may be subject to forfeiture and any other terms and
conditions of the Awards, in addition to those contained in
Section 7(c).
The Committee may condition the grant of Restricted
Stock upon the attainment of specified performance goals of the
participant or of the Company or subsidiary, division or
department of the Company for or within which the participant is
primarily employed or upon such other factors or criteria as the
Committee shall determine. The provisions of Restricted Stock
Awards need not be the same with respect to each recipient.
(b) Awards and Certificates. Shares of Restricted
Stock shall be evidenced in such manner as the
-11-<PAGE>
Committee may deem appropriate, including book-entry registration
or issuance of one or more stock certificates. Any certificate
issued in respect of shares of Restricted Stock shall be
registered in the name of such participant and shall bear an
appropriate legend referring to the terms, conditions, and
restrictions applicable to such Award, substantially in the
following form:
"The transferability of this certificate and the shares
of stock represented hereby are subject to the terms and
conditions (including forfeiture) of the Tommy Hilfiger
U.S.A. 1992 Stock Incentive Plan, As Amended, and a
Restricted Stock Agreement. Copies of such Plan and
Agreement are on file at the offices of Tommy Hilfiger
U.S.A., Inc., 25 West 39th Street, New York, New York
10018."
The Committee may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions
thereon shall have lapsed and that, as a condition of any Award of
Restricted Stock, the participant shall have delivered a stock
power, endorsed in blank, relating to the Stock covered by such
Award.
(c) Terms and Conditions. Shares of Restricted Stock
shall be subject to the following terms and conditions:
(i) Subject to the provisions of the Plan and the
Restricted Stock Agreement referred to in Section 7(c) (vi),
during a period set by the Committee, commencing with the
date of such Award (the "Restriction Period"), the
participant shall not be permitted to sell, assign, transfer,
pledge or otherwise encumber shares of Restricted Stock.
The Committee may provide for the lapse of such restrictions
in installments or otherwise and may accelerate or waive such
restrictions, in whole or in part, in each case based on
period of service, performance of the participant or of the
Company or the subsidiary, division or department for which
the participant is employed or such other factors or criteria
as the Committee may determine.
(ii) Except as provided in this paragraph (ii)
and Section 7(c)(i) and the Restricted Stock Agreement, the
participant shall have, with respect to the shares of
Restricted Stock, all of the rights of a stockholder
-12-<PAGE>
of the Company holding the class or series of Stock that is
the subject of the Restricted Stock, including, if applicable,
the right to vote the shares and the right to receive any cash
dividends. If so determined by the Committee in the
applicable Restricted Stock Agreement and subject to Section
10(f) of the Plan, (1) cash dividends on the shares of Stock
that are the subject of the Restricted Stock Award shall be
automatically deferred and reinvested in additional Restricted
Stock, and (2) dividends payable in Stock shall be paid in the
form of Restricted Stock.
(iii) Except to the extent otherwise provided in
the applicable Restricted Stock Agreement and Sections 7(c)(i)
and 7(c) (iv), upon a participant's Termination of Employment
for any reason during the Restriction Period, all shares still
subject to restriction shall be forfeited by the participant.
(iv) In the event of Termination of Employment of
a participant for any reason (other than for Cause), the
Committee shall have the discretion to waive in whole or in
part any or all remaining restrictions with respect to any or
all of such participants' shares of Restricted Stock.
(v) If and when the Restriction Period expires
without a prior forfeiture of the Restricted Stock subject
to such Restriction Period, unlegended certificates for such
shares shall be delivered to the participant.
(vi) Each Award shall be confirmed by, and be
subject to the terms of, a Restricted Stock Agreement.
SECTION 8. TERM, AMENDMENT AND TERMINATION.
The Plan will terminate on December 31, 2002. Under the
Plan, Awards outstanding as of December 31, 2002 shall not be
affected or impaired by the termination of the Plan.
The Board may amend, alter, or discontinue the Plan, but
no amendment, alteration or discontinuation shall be made which
would impair the rights of an optionee under a Stock Option or a
recipient of a Stock Appreciation Right or
-13-<PAGE>
Restricted Stock Award theretofore granted without the optionee's
or recipient's consent.
The Committee may amend the terms of any Stock Option or
other Award theretofore granted, prospectively or retroactively,
but no such amendment shall impair the rights of any holder
without the holder's consent.
SECTION 9. UNFUNDED STATUS OF PLAN.
It is presently intended that the Plan constitute an
"unfunded" plan for incentive and deferred compensation. The
Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan to
deliver Stock or make payments; provided, however, that, unless
the Committee otherwise determines, the existence of such trusts
or other arrangements is consistent with the "unfunded" status of
the Plan.
SECTION 10. GENERAL PROVISIONS.
(a) The Committee may require each person purchasing
or receiving shares pursuant to an Award to represent to and agree
with the Company in writing that such person is acquiring the
shares without a view to the distribution thereof. The
certificates for such shares may include any legend which the
Committee deems appropriate to reflect any restrictions on
transfer.
All certificates for shares of Stock or other securities
delivered under the Plan shall be subject to such stock transfer
orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the
Commission, any stock exchange upon which the Stock is then listed
and any applicable Federal or state securities law, and the
Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such restrictions.
(b) Nothing contained in the Plan shall prevent the
Company or any subsidiary or Affiliate from adopting other or
additional compensation arrangements for its employees.
(c) The adoption of the Plan shall not confer upon any
employee any right to continued employment nor shall it interfere
in any way with the right of the Company
-14-<PAGE>
or any subsidiary or Affiliate to terminate the employment of any
employee at any time.
(d) No later than the date as of which an amount first
becomes includible in the gross income of the participant for
Federal income tax purposes with respect to any Award under the
Plan, the participant shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment
of, any Federal, state, local or foreign taxes of any kind
required by law to be withheld with respect to such amount.
Unless otherwise determined by the Committee, withholding
obligations may be settled with Stock, including Stock that is
part of the Award that gives rise to the withholding requirement.
The obligations of the Company under the Plan shall be conditional
on such payment or arrangements, and the Company, its Subsidiaries
and its Affiliates shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment otherwise due to
the participant. The Committee may establish such procedures as
it deems appropriate, including the making of irrevocable
elections, for the settlement of withholding obligations with
Stock.
(e) At the time of grant, the Committee may provide in
connection with any grant made under the Plan that the shares of
Stock received as a result of such grant shall be subject to a
right of first refusal pursuant to which the participant shall be
required to offer to the Company any shares that the participant
wishes to sell at the then Fair Market Value of the Stock, subject
to such other terms and conditions as the Committee may specify at
the time of grant.
(f) The reinvestment of dividends in additional
Restricted Stock at the time of any dividend payment shall only be
permissible if sufficient shares of Stock are available under
Section 3 for such reinvestment (taking into account then
outstanding Stock Options and other Awards).
(g) The Committee shall establish such procedures as it
deems appropriate for a participant to designate a beneficiary to
whom any amounts payable in the event of the participant's death
are to be paid.
(h) The Plan and all Awards made and actions taken
thereunder shall be governed by and construed in accordance with
the laws of Delaware.
SECTION 11. EFFECTIVE DATE OF PLAN.
-15-<PAGE>
The Plan shall be effective on the date it is approved
by the shareholders of the Company.
-16-
Exhibit 4.2
TOMMY HILFIGER (EASTERN HEMISPHERE) LIMITED
1992 STOCK INCENTIVE PLAN
(Restated to Incorporate All Amendments
through October 27, 1997 and the Effects of the
December 27, 1994 Two-for-One Stock Split)<PAGE>
SECTION 1. PURPOSE; DEFINITIONS.
The purpose of the Plan is to give the Company and
its Affiliates a significant advantage in attracting,
retaining and motivating officers, employees and directors
and to provide the Company and its subsidiaries with the
ability to provide incentives more directly linked to the
profitability of the Company's businesses and increases in
stockholder value.
For purposes of the Plan, the following terms are
defined as set forth below:
a. "Affiliate" means a corporation or other
entity controlled by or in control of the Company and
designated by the Committee as such.
b. "Award" means a Stock Appreciation Right,
Stock Option or Restricted Stock.
c. "Board" means the Board of Directors of the
Company.
d. "Cause" has the meaning set forth in Section
5(i).
e. "Code" means the Internal Revenue Code of
1986, as amended from time to time, and any successor there-
to.
f. "Committee" means the Committee referred to
in Section 2.
g. "Company" means Tommy Hilfiger (Far East)
Limited, a British Virgin Islands corporation.
h. "Disability" means permanent and total dis-
ability as determined under procedures established by the
Committee for purposes of the Plan.
i. "Fair Market Value" means, as of any given
date, the mean between the highest and lowest reported sales
prices of the Stock on the New York Stock Exchange Composite
Tape or, if not listed on such exchange, on any other
national securities exchange on which the Stock is listed or
on NASDAQ. If there is no regular public trading market for
such Stock, the Fair Market Value of the Stock shall be
determined by the Committee in good faith.
j. "Incentive Stock Option" means any Stock Op-
tion intended to be and designated as an "incentive stock
option" within the meaning of Section 422 of the Code.<PAGE>
k. "Non-Qualified Stock Option" means any Stock
Option that is not an Incentive Stock Option.
l. "Plan" means the Tommy Hilfiger (Far East)
Limited 1992 Stock Incentive Plan, as set forth herein and
as hereinafter amended from time to time.
m. "Restricted Stock" means an award granted
under Section 7.
n. "Retirement" means retirement from active
employment under a pension plan of the Company, any subsid-
iary or Affiliate, or under an employment contract with any
of them, or termination of employment at or after age 55
under circumstances which the Committee, in its sole discre-
tion, deems equivalent to retirement.
o. "Stock" means the ordinary shares, par value
$0.01 per share, of Tommy Hilfiger Corporation, a British
Virgin Islands corporation.
p. "Stock Appreciation Right" means a right
granted under Section 6.
q. "Stock Option" means an option granted under
Section 5.
r. "Termination of Employment" means the
termination of the participant's employment with the Company
and any subsidiary or Affiliate. A participant employed by
a subsidiary or an Affiliate shall also be deemed to incur a
Termination of Employment if the subsidiary or Affiliate
ceases to be such a subsidiary or Affiliate, as the case may
be, and the participant does not immediately thereafter
become an employee of the Company or another subsidiary or
Affiliate.
In addition, certain other terms used herein have
definitions given to them in the first place in which they
are used.
SECTION 2. ADMINISTRATION.
The Plan shall be administered by the Compensation
Committee of the Board. If at any time no Committee shall
be in office, the functions of the Committee specified in
the Plan shall be exercised by the Board.
- 2 -<PAGE>
The Committee shall have plenary authority to
grant Awards pursuant to the terms of the Plan to officers,
employees and directors of the Company and its subsidiaries
and Affiliates.
Among other things, the Committee shall have the
authority, subject to the terms of the Plan:
(a) subject to Section 4, to select the officers,
employees and directors to whom Awards may from time to time
be granted;
(b) to determine whether and to what extent
Incentive Stock Options, Non-Qualified Stock Options, Stock
Appreciation Rights and Restricted Stock or any combination
thereof are to be granted hereunder;
(c) to determine the number of shares of Stock to
be covered by each Award granted hereunder;
(d) to determine the terms and conditions of any
Award granted hereunder (including, but not limited to, the
option price (subject to Section 5(a)), any vesting restric-
tion or limitation and any vesting acceleration or
forfeiture waiver regarding any Award and the shares of
Stock relating thereto, based on such factors as the
Committee shall determine);
(e) to modify, amend or adjust the terms and con-
ditions of any Award, at any time or from time to time,
including, but not limited to, with respect to performance
goals and measurements applicable to performance-based
Awards pursuant to the terms of the Plan;
(f) to determine to what extent and under what
circumstances Stock and other amounts payable with respect
to an Award shall be deferred; and
(g) to determine under what circumstances a Stock
Option may be settled in cash or Stock under Section 5(j).
The Committee shall have the authority to adopt,
alter and repeal such administrative rules, guidelines and
practices governing the Plan as it shall, from time to time,
deem advisable, to interpret the terms and provisions of the
Plan and any Award issued under the Plan (and any agreement
relating thereto) and to otherwise supervise the administra-
tion of the Plan.
- 3 -<PAGE>
Any determination made by the Committee or
pursuant to delegated authority pursuant to the provisions
of the Plan with respect to any Award shall be made in the
sole discretion of the Committee or such delegate at the
time of the grant of the Award or, unless in contravention
of any express term of the Plan, at any time thereafter.
All decisions made by the Committee or any appropriately
delegated officer pursuant to the provisions of the Plan
shall be final and binding on all persons, including the
Company and Plan participants.
SECTION 3. STOCK SUBJECT TO PLAN.
Subject to adjustment as provided herein, the
total number of shares of Stock available for grant under
the Plan shall be 6,220,000 shares of Stock, less the number
of shares of Stock which have been made subject to an Award
under the Tommy Hilfiger U.S.A. 1992 Stock Incentive Plan.
Shares of Stock subject to an Award under the Plan may be
authorized and unissued shares or may be treasury shares.
If any shares of Restricted Stock are forfeited
for which the participant did not receive any benefits of
ownership (as such phrase is construed by the Commission or
its Staff), or if any Stock Option (and related Stock Ap-
preciation Right, if any) terminates without being
exercised, or if any Stock Appreciation Right is exercised
for cash, shares subject to such Awards shall again be
available for distribution in connection with Awards under
the Plan.
In the event of any merger, reorganization,
consolidation, recapitalization, stock dividend, stock
split, extraordinary distribution with respect to the Stock
or other change in corporate structure affecting the Stock,
the Committee or Board may make such substitution or
adjustments in the aggregate number and kind of shares
reserved for issuance under the Plan, in the number, kind
and option price of shares subject to outstanding Stock
Options and Stock Appreciation Rights, in the number and
kind of shares subject to other outstanding Awards granted
under the Plan and/or such other substitution or adjustments
in the consideration receivable upon exercise as it may
determine to be appropriate in its sole discretion;
provided, however, that the number of shares subject to any
Award shall always be a whole number. Such adjusted option
price shall also be used to determine the amount payable by
- 4 -<PAGE>
the Company upon the exercise of any Stock Appreciation
Right associated with any Stock Option.
SECTION 4. ELIGIBILITY.
Officers, employees and directors of the Company,
its subsidiaries and Affiliates who are responsible for or
contribute to the management, growth and profitability of
the business of the Company, its subsidiaries and Affiliates
are eligible to be granted Awards under the Plan. No grant
shall be made to Thomas J. Hilfiger, Joel J. Horowitz, Silas
K.F. Chou, Ronald K.Y. Chao, Lawrence S. Stroll or Edwin H.
Lewis pursuant to this Plan.
SECTION 5. STOCK OPTIONS.
Stock Options may be granted alone or in addition
to other Awards granted under the Plan and may be of two
types: Incentive Stock Options and Non-Qualified Stock Op-
tions. Any Stock Option granted under the Plan shall be in
such form as the Committee may from time to time approve.
The Committee shall have the authority to grant
any optionee Incentive Stock Options, Non-Qualified Stock
Options or both types of Stock Options (in each case with or
without Stock Appreciation Rights). Incentive Stock Options
may be granted only to employees of the Company and its
subsidiaries (within the meaning of Section 424(f) of the
Code). To the extent that any Stock Option is not designated
as an Incentive Stock Option or even if so designated does
not qualify as an Incentive Stock Option, it shall constitute
a Non-Qualified Stock Option.
Stock Options shall be evidenced by option agree-
ments, the terms and provisions of which may differ. An op-
tion agreement shall indicate on its face whether it is
intended to be an agreement for an Incentive Stock Option or
a Non-Qualified Stock Option. The grant of a Stock Option
shall occur on the date the Committee by resolution selects
an individual to be a participant in any grant of a Stock
Option, determines the number of shares of Stock to be
subject to such Stock Option to be granted to such
individual and specifies the terms and provisions of the
Stock Option. The Company shall notify a participant of any
grant of a Stock Option, and a written option agreement or
agreements shall be duly executed and delivered by the
Company to the participant.
- 5 -<PAGE>
Anything in the Plan to the contrary notwithstand-
ing, no term of the Plan relating to Incentive Stock Options
shall be interpreted, amended or altered nor shall any dis-
cretion or authority granted under the Plan be exercised so
as to disqualify the Plan under Section 422 of the Code or,
without the consent of the optionee affected, to disqualify
any Incentive Stock Option under such Section 422.
Stock Options granted under the Plan shall be sub-
ject to the following terms and conditions and shall contain
such additional terms and conditions as the Committee shall
deem desirable:
(a) Option Price. The option price per share of
Stock purchasable under a Stock Option shall be determined
by the Committee and set forth in the option agreement, and
shall not be less than the Fair Market Value of the Stock
subject to the Stock Option on the date of grant.
(b) Option Term. The term of each Stock Option
shall be fixed by the Committee, but no Stock Option shall
be exercisable more than 15 years after the date the Stock
Option is granted.
(c) Exercisability. Except as otherwise provided
herein, Stock Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be
determined by the Committee. If the Committee provides that
any Stock Option is exercisable only in installments, the
Committee may at any time waive such installment exercise
provisions, in whole or in part, based on such factors as
the Committee may determine. In addition, the Committee may
at any time, in whole or in part, accelerate the
exercisability of any Stock Option.
(d) Method of Exercise. Subject to the
provisions of this Section 5, Stock Options may be
exercised, in whole or in part, at any time during the
option term by giving written notice of exercise to the
Company specifying the number of shares of Stock subject to
the Stock Option to be purchased.
The option price of Stock to be purchased upon
exercise of any Option shall be paid in full in cash (by
certified or bank check or such other instrument as the
Company may accept) or, if and to the extent set forth in
the option agreement, may also be paid by one or more of the
following: (i) in the form of unrestricted Stock already
owned by the optionee (and, in the case of the exercise of a
- 6 -<PAGE>
Non-Qualified Stock Option, Restricted Stock subject to an
Award hereunder) based in any such instance on the Fair
Market Value of the Stock on the date the Stock Option is
exercised; provided, however, that, in the case of an
Incentive Stock Option, the right to make a payment in the
form of already owned shares of Stock may be authorized only
at the time the Stock Option is granted; (ii) by requesting
the Company to withhold from the number of shares of Stock
otherwise issuable upon exercise of the Stock Option that
number of shares having an aggregate fair market value on
the date of exercise equal to the exercise price for all of
the shares of Stock subject to such exercise; or (iii) by a
combination thereof, in each case in the manner provided in
the option agreement.
In the discretion of the Committee, payment for
any shares subject to a Stock Option may also be made by
delivering a properly executed exercise notice to the
Company, together with a copy of irrevocable instructions to
a broker to deliver promptly to the Company the amount of
sale or loan proceeds to pay the purchase price. To
facilitate the foregoing, the Company may enter into
agreements for coordinated procedures with one or more
brokerage firms.
If payment of the option exercise price of a
Non-Qualified Stock Option is made in whole or in part in
the form of Restricted Stock, the number of shares of Stock
to be received upon such exercise equal to the number of
shares of Restricted Stock used for payment of the option
exercise price shall be subject to the same forfeiture
restrictions to which such Restricted Stock was subject,
unless otherwise determined by the Committee.
No shares of Stock shall be issued until full pay-
ment therefor has been made. Subject to any forfeiture
restrictions that may apply if a Stock Option is exercised
using Restricted Stock, an optionee shall have all of the
rights of a stockholder of the Company holding the Stock
that is subject to such Stock Option (including, if
applicable, the right to vote the shares and the right to
receive dividends), when the optionee has given written
notice of exercise, has paid in full for such shares and, if
requested, has given the representation described in Section
10(a).
(e) Non-transferability of Stock Options. No
Stock Option shall be transferable by the optionee other
than (i) by will or by the laws of descent and distribution
or (ii) in the case of a Non-Qualified Stock Option,
- 7 -<PAGE>
pursuant to a qualified domestic relations order (as defined
in the Code or Title I of the Employee Retirement Income
Security Act of 1974, as amended, or the rules thereunder)
All Stock Options shall be exercisable, during the
optionee's lifetime, only by the optionee or by the guardian
or legal representative of the optionee or, in the case of a
Non-Qualified Stock Option, its alternate payee pursuant to
such qualified domestic relations order, it being understood
that the terms "holder" and "optionee" include the guardian
and legal representative of the optionee named in the option
agreement and any person to whom an option is transferred by
will or the laws of descent and distribution or, in the case
of a Non-Qualified Stock Option, pursuant to a qualified
domestic relations order.
(f) Termination by Death. If an optionee's
employment terminates by reason of death, any Stock Option
held by such optionee may thereafter be exercised, to the
extent then exercisable, or on such accelerated basis as the
Committee may determine, for a period of one year (or such
other period as the Committee may specify in the option
agreement) from the date of such death or until the expira-
tion of the stated term of such Stock Option, whichever
period is the shorter. In the event of termination of
employment due to death, if an Incentive Stock Option is
exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock
Option.
(g) Termination by Reason of Disability. If an
optionee's employment terminates by reason of Disability,
any Stock Option held by such optionee may thereafter be
exercised by the optionee, to the extent it was exercisable
at the time of termination, or on such accelerated basis as
the Committee may determine, for a period of one year (or
such shorter period as the Committee may specify in the
option agreement) from the date of such termination of
employment or until the expiration of the stated term of
such Stock Option, whichever period is the shorter;
provided, however, that if the optionee dies within such
one-year period (or such shorter period), any unexercised
Stock Option held by such optionee shall, notwithstanding
the expiration of such three-year (or such shorter) period,
continue to be exercisable to the extent to which it was
exercisable at the time of death for a period of 12 months
from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the
shorter. In the event of termination of employment by
reason of Disability, if an Incentive Stock Option is
- 8 -<PAGE>
exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock
Option.
(h) Termination by Reason of Retirement. If an
optionee' 5 employment terminates by reason of Retirement,
any Stock Option held by such optionee may thereafter be
exercised by the optionee, to the extent it was exercisable
at the time of such Retirement or on such accelerated basis
as the Committee may determine, for a period of three years
(or such shorter period as the Committee may specify in the
option agreement) from the date of such termination of
employment or until the expiration of the stated term of
such Stock Option, whichever period is the shorter;
provided, however, that if the optionee dies within such
three-year (or such shorter) period, any unexercised Stock
Option held by such optionee shall, notwithstanding the
expiration of such three-year (or such shorter) period,
continue to be exercisable to the extent to which it was
exercisable at the time of death for a period of 12 months
from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the
shorter. In the event of termination of employment by
reason of Retirement, if an Incentive Stock Option is
exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock
Option.
(i) Other Termination. Unless otherwise deter-
mined by the Committee, if an optionee incurs a Termination
of Employment for any reason other than death, Disability or
Retirement, any Stock Option held by such Optionee shall
thereupon terminate, except that such Stock Option, to the
extent then exercisable, or on such accelerated basis as the
Committee may determine, may be exercised for the lesser of
three months from the date of such Termination of Employment
or the balance of such Stock Option's term if such Termina-
tion of Employment of the optionee is without Cause;
provided, however, that if the optionee dies within such
three-month period, any unexercised Stock Option held by
such optionee shall notwithstanding the expiration of such
three-month period, continue to be exercisable to the extent
to which it was exercisable at the time of death for a
period of 12 months from the date of such death or until the
expiration of the stated term of such Stock Option,
whichever period is the shorter. In the event of
Termination of Employment for any reason other than death,
Disability or Retirement, if an Incentive Stock Option is
- 9 -<PAGE>
exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock
Option will thereafter be treated as a Non-Qualified Stock
Option. Unless otherwise determined by the Committee, for
the purposes of the Plan "Cause" shall mean (i) the
conviction of the optionee for committing a felony under
Federal law or the law of the state in which such action
occurred, (ii) dishonesty in the course of fulfilling the
optionee's employment duties or (iii) willful and deliberate
failure on the part of the optionee to perform his
employment duties in any material respect.
(j) Cashing Out of Stock Option. On receipt of
written notice of exercise, the Committee may elect to cash
out all or part of the portion of the shares of Stock for
which a Stock Option is being exercised by paying the
optionee an amount, in cash or Stock, equal to the excess of
the Fair Market Value of the Stock over the option price
times the number of shares of Stock for which to the Option
is being exercised on the effective date of such cash out.
SECTION 6. STOCK APPRECIATION RIGHTS.
(a) Grant and Exercise. Stock Appreciation
Rights may be granted in conjunction with all or part of any
Stock Option granted under the Plan. In the case of a
Non-Qualified Stock Option, such rights may be granted
either at or after the time of grant of such Stock Option.
In the case of an Incentive Stock Option, such rights may be
granted only at the time of grant of such Stock Option. A
Stock Appreciation Right shall terminate and no longer be
exercisable upon the termination or exercise of the related
Stock Option.
A Stock Appreciation Right may be exercised by an
optionee in accordance with Section 6(b) by surrendering the
applicable portion of the related Stock Option in accordance
with procedures established by the Committee. Upon such
exercise and surrender, the optionee shall be entitled to
receive an amount determined in the manner prescribed in
Section 6 (b). Stock Options which have been so surrendered
shall no longer be exercisable to the extent the related
Stock Appreciation Rights have been exercised.
(b) Terms and Conditions. Stock Appreciation
Rights shall be subject to such terms and conditions as
shall be determined by the Committee, including the
following:
- 10 -<PAGE>
(i)Stock Appreciation Rights shall be exercisable
only at such time or times and to the extent that the Stock
Options to which they relate are exercisable in accordance
with the provisions of Section 5 and this Section 6.
(ii)Upon the exercise of a Stock Appreciation
Right, an optionee shall be entitled to receive an amount in
cash, shares of Stock or both equal in value to the excess of
the Fair Market Value of one share of Stock over the option
price per share specified in the related Stock Option
multiplied by the number of shares in respect of which the
Stock Appreciation Right shall have been exercised, with the
Committee having the right to determine the form of payment.
(iii)Stock Appreciation Rights shall be
transferable only to permitted transferees of the underlying
Stock Option in accordance with Section 5(e).
SECTION 7. RESTRICTED STOCK.
(a) Administration. Shares of Restricted Stock
may be awarded either alone or in addition to other Awards
granted under the Plan. The Committee shall determine the
officers and employees to whom and the time or times at
which grants of Restricted Stock will be awarded, the number
of shares to be awarded to any participant, the time or
times within which such Awards may be subject to forfeiture
and any other terms and conditions of the Awards, in
addition to those contained in Section 7(c).
The Committee may condition the grant of
Restricted Stock upon the attainment of specified
performance goals of the participant or of the Company or
subsidiary, division or department of the Company for or
within which the participant is primarily employed or upon
such other factors or criteria as the Committee shall
determine. The provisions of Restricted Stock Awards need
not be the same with respect to each recipient.
(b) Awards and Certificates. Shares of
Restricted Stock shall be evidenced in such manner as the
Committee may deem appropriate, including book-entry
registration or issuance of one or more stock certificates.
Any certificate issued in respect of shares of Restricted
Stock shall be registered in the name of such participant
and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Award,
substantially in the following form:
"The transferability of this certificate
and the shares of stock represented
hereby are subject to the terms and
conditions (including forfeiture) of the
- 11 -<PAGE>
Tommy Hilfiger (Far East) Limited 1992
Stock Incentive Plan and a Restricted
Stock Agreement. Copies of such Plan and
Agreement are on file at the offices of
Tommy Hilfiger (Far East) Limited, 6/F,
Precious Industrial Centre, 18 Cheung Yue
Street, Cheung Sha Wan, Kowloon, Hong
Kong."
The Committee may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions
thereon shall have lapsed and that, as a condition of any Award of
Restricted Stock, the participant shall have delivered a stock
power, endorsed in blank, relating to the Stock covered by such
Award.
(c) Terms and Conditions. Shares of Restricted Stock
shall be subject to the following terms and conditions:
(i)Subject to the provisions of the Plan and the
Restricted Stock Agreement referred to in Section 7(c)(vi),
during a period set by the Committee, commencing with the
date of such Award (the "Restriction Period"), the
participant shall not be permitted to sell, assign, transfer,
pledge or otherwise encumber shares of Restricted Stock. The
Committee may provide for the lapse of such restrictions in
installments or otherwise and may accelerate or waive such
restrictions, in whole or in part, in each case based on
period of service, performance of the participant or of the
Company or the subsidiary, division or department for which
the participant is employed or such other factors or criteria
as the Committee may determine.
(ii)Except as provided in this paragraph (ii) and
Section 7(c)(i) and the Restricted Stock Agreement, the
participant shall have, with respect to the shares of
Restricted Stock, all of the rights of a stockholder of the
Company holding the class or series of Stock that is the
subject of the Restricted Stock, including, if applicable,
the right to vote the shares and the right to receive any
cash dividends. If so determined by the Committee in the
applicable Restricted Stock Agreement and subject to Section
10(f) of the Plan, (1) cash dividends on the shares of Stock
that are the subject of the Restricted Stock Award shall be
automatically deferred and reinvested in additional
Restricted Stock, and (2) dividends payable in Stock shall be
paid in the form of Restricted Stock.
(iii)Except to the extent otherwise provided in the
applicable Restricted Stock Agreement and Sections 7(c)(i)
and 7(c)(iv), upon a participant's Termination of Employment
for any reason during the Restriction Period, all shares
still subject to restriction shall be forfeited by the
participant.
- 12 -<PAGE>
(iv)In the event of Termination of Employment of a
participant for any reason (other than for Cause), the
Committee shall have the discretion to waive in whole or in
part any or all remaining restrictions with respect to any or
all of such participant's shares of Restricted Stock.
(v)If and when the Restriction Period expires
without a prior forfeiture of the Restricted Stock subject to
such Restriction Period, unlegended certificates for such
shares shall be delivered to the participant.
(vi)Each Award shall be confirmed by, and be
subject to the terms of, a Restricted Stock Agreement.
SECTION 8. TERM, AMENDMENT AND TERMINATION.
The Plan will terminate on December 31, 2002.
Under the Plan, Awards outstanding as of December 31,
2002 shall not be affected or impaired by the
termination of the Plan.
The Board may amend, alter, or discontinue the
Plan, but no amendment, alteration or discontinuation
shall be made which would impair the rights of an
optionee under a Stock Option or a recipient of a Stock
Appreciation Right or Restricted Stock Award theretofore
granted without the optionee's or recipient's consent.
The Committee may amend the terms of any Stock
Option or other Award theretofore granted, prospectively
or retroactively, but no such amendment shall impair the
rights of any holder without the holder's consent.
SECTION 9. UNFUNDED STATUS OF PLAN.
It is presently intended that the Plan
constitute an "unfunded" plan for incentive and deferred
compensation. The Committee may authorize the creation
of trusts or other arrangements to meet the obligations
created under the Plan to deliver Stock or make
payments; provided, however, that, unless the Committee
otherwise determines, the existence of such trusts or
other arrangements is consistent with the "unfunded"
status of the Plan.
SECTION 10. GENERAL PROVISIONS.
(a) The Committee may require each person
purchasing or receiving shares pursuant to an Award to
represent to and agree with the Company in writing that such
person is acquiring the shares without a view to the
- 13 -<PAGE>
distribution thereof. The certificates for such shares may
include any legend which the Committee deems appropriate to
reflect any restrictions on transfer.
All certificates for shares of Stock or other
securities delivered under the Plan shall be subject to such
stock transfer orders and other restrictions as the Committee
may deem advisable under the rules, regulations and other
requirements of the Commission, any stock exchange upon which
the Stock is then listed and any applicable Federal or state
securities law, and the Committee may cause a legend or
legends to be put on any such certificates to make
appropriate reference to such restrictions.
(b) Nothing contained in the Plan shall prevent
the Company or any subsidiary or Affiliate from adopting
other or additional compensation arrangements for its
employees.
(c) The adoption of the Plan shall not confer upon
any employee any right to continued employment nor shall it
interfere in any way with the right of the Company or any
subsidiary or Affiliate to terminate the employment of any
employee at any time.
(d) No later than the date as of which an amount
first becomes includible in the gross income of the partici-
pant for Federal income tax purposes with respect to any
Award under the Plan, the participant shall pay to the Com-
pany, or make arrangements satisfactory to the Company
regarding the payment of, any Federal, state, local or for-
eign taxes of any kind required by law to be withheld with
respect to such amount. Unless otherwise determined by the
Committee, withholding obligations may be settled with Stock,
including Stock that is part of the Award that gives rise to
the withholding requirement. The obligations of the Company
under the Plan shall be conditional on such payment or
arrangements, and the Company, its Subsidiaries and its
Affiliates shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment otherwise due
to the participant. The Committee may establish such
procedures as it deems appropriate, including the making of
irrevocable elections, for the settlement of withholding
obligations with Stock.
(e) At the time of grant, the Committee may pro-
vide in connection with any grant made under the Plan that
the shares of Stock received as a result of such grant shall
be subject to a right of first refusal pursuant to which the
participant shall be required to offer to the Company any
shares that the participant wishes to sell at the then Fair
Market Value of the Stock, subject to such other terms and
conditions as the Committee may specify at the time of grant.
- 14 -<PAGE>
(f) The reinvestment of dividends in additional
Restricted Stock at the time of any dividend payment shall
only be permissible if sufficient shares of Stock are avail-
able under Section 3 for such reinvestment (taking into ac-
count then outstanding Stock Options and other Awards).
(g) The Committee shall establish such procedures
as it deems appropriate for a participant to designate a
beneficiary to whom any amounts payable in the event of the
participant's death are to be paid.
(h) The Plan and all Awards made and actions taken
thereunder shall be governed by and construed in accordance
with the laws of the British Virgin Islands.
SECTION 11. EFFECTIVE DATE OF PLAN.
The Plan shall be effective on the date it is ap-
proved by the shareholders of the Company.
- 15 -
EXHIBIT 5
[Letterhead of Harney, Westwood & Riegels]
Your Ref:
Our Ref: HDH/as/005-5590.002 15 December, 1997
Securities and Exchange Commission
Division of Corporation Finance
Washington, D.C. 20549
U.S.A.
Dear Sirs,
Re: REGISTRATION STATEMENT ON FORM S-8 FILED BY
TOMMY HILFIGER CORPORATION RELATING TO THE
TOMMY HILFIGER U.S.A. AND TOMMY HILFIGER
(EASTERN HEMISPHERE) LIMITED 1992 STOCK INCENTIVE PLANS
We are British Virgin Islands counsel to Tommy Hilfiger Corpo-
ration, a company incorporated under the laws of the British
Virgin Islands (hereinafter called the "Company"), in connec-
tion with the registration under the Securities Act of 1933, as
amended (the "Act"), of the Ordinary Shares, par value $.01 per
share (the "Ordinary Shares"), of the Company issuable under
the Tommy Hilfiger U.S.A. 1992 Stock Incentive Plan, as amended
and restated, and the Tommy Hilfiger (Eastern Hemisphere) Lim-
ited 1992 Stock Incentive Plan, as amended and restated (to-
gether the "Plans").
For the purpose of this opinion, we have examined originals or
copies of the Plans, the Memorandum and Articles of Association
of the Company, and such other corporate documents and records
of the Company as we have deemed relevant and necessary as a
basis for this opinion.
For purposes of this opinion we have assumed the genuineness of
all signatures on all documents and the completeness, and the
conformity to original documents, of all copies submitted to us
and that all representations of fact (other than those opined
on below) expressed in or implied by the documents are accu-
rate.
On the basis of the foregoing, we are of the opinion that the
6,220,000 Ordinary Shares of the Company when issued pursuant<PAGE>
Securities and Exchange Commission
Division of Corporation Finance
Page 2
15 December, 1997
to the terms of the Plans will be validly issued, fully paid
and non assessable.
We hereby consent to the filing of this opinion as an exhibit
to Registration Statement on Form S-8 relating to the Plans.
Yours faithfully,
HARNEY, WESTWOOD & RIEGELS
/s/ Hazel-Dawn Hewlett
Hazel-Dawn Hewlett
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated May 21,
1997, appearing under Item 8 of the Tommy Hilfiger Corporation
Annual Report on Form 10-K for the fiscal year ended March 31,
1997.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
New York, New York
December 15, 1997
