STOCK APPRECIATION RIGHT AGREEMENT (2007 Long-Term Incentive Plan) Semi-Annual Grant
Exhibit 10.2
(2007 Long-Term Incentive Plan)
Semi-Annual Grant
This STOCK AWARD AGREEMENT (this “AGREEMENT”) is made to be effective as of
, 200 (the “GRANT DATE”), by and between Abercrombie & Fitch Co., a
Delaware corporation (the “COMPANY”), and Xxxxxxx X. Xxxxxxxx (the “PARTICIPANT”).
WITNESSETH:
WHEREAS, pursuant to the provisions of the 2007 Long-Term Incentive Plan of the COMPANY (the
“PLAN”), the Compensation Committee (the “COMMITTEE”) of the Board of Directors of the COMPANY (the
“BOARD”) administers the PLAN;
WHEREAS, the Employment Agreement between the COMPANY and the PARTICIPANT, dated as of
December 19, 2008 (the “EMPLOYMENT AGREEMENT”) provides that the PARTICIPANT shall receive certain
equity grants under the PLAN; and
WHEREAS, the COMMITTEE has determined that an award of stock appreciation rights (“SARs”) with
respect to ( ) [TO BE DETERMINED PURSUANT
TO SECTION 4(d) OF THE EMPLOYMENT AGREEMENT] shares of Class A Common Stock, $0.01 par value (the
“SHARES”), of the COMPANY should be granted to the PARTICIPANT upon the terms and conditions set
forth in the EMPLOYMENT AGREEMENT and this AGREEMENT.
NOW, THEREFORE, in consideration of the premises, the parties hereto make the following
agreement, intending to be legally bound thereby:
1. Grant of AWARD. Pursuant to, and subject to, the terms and conditions set forth in
this AGREEMENT, the EMPLOYMENT AGREEMENT and in the PLAN, the COMPANY hereby grants to the
PARTICIPANT an award of ( ) SARs (the
“AWARD”) [TO BE DETERMINED PURSUANT TO SECTION 4(d) OF THE EMPLOYMENT AGREEMENT]. Each SAR
represents the right to receive, upon exercise of the SAR, pursuant to this AGREEMENT, from the
COMPANY, a payment, paid in SHARES of the COMPANY, having a value equal to the excess of the FAIR
MARKET VALUE (as defined in the PLAN), on the date of exercise, of one SHARE of the COMPANY
(subject to adjustment as provided in Section 11(c) of the PLAN) over the BASE PRICE (as defined
below).
2. Terms and Conditions of the AWARD.
(A) BASE PRICE. The “BASE PRICE” shall be $ per share [TO BE EQUAL
TO THE FAIR MARKET VALUE ON THE GRANT DATE] (subject to adjustment as provided in Section 11(c) of
the PLAN).
(B) Exercise of the AWARD. Except as provided under Sections 3 and 5 of this
AGREEMENT, no portion of the AWARD may be exercised until the first anniversary of the GRANT DATE,
provided that the PARTICIPANT is employed by the COMPANY or a subsidiary of the COMPANY on such
date. Thereafter, except as otherwise provided in this AGREEMENT, the AWARD may be exercised as
follows:
(i) at any time after the first anniversary of the GRANT DATE, as to 25% of the SARs subject
to the AWARD, provided that the PARTICIPANT is employed by the COMPANY or a subsidiary of the
COMPANY on such date;
(ii) at any time after the second anniversary of the GRANT DATE, as to an additional 25% of
the SARs subject to the AWARD, provided that the PARTICIPANT is employed by the COMPANY or a
subsidiary of the COMPANY on such date;
(iii) at any time after the third anniversary of the GRANT DATE, as to an additional 25% of
the SARs subject to the AWARD, provided that the PARTICIPANT is employed by the COMPANY or a
subsidiary of the COMPANY on such date; and
(iv) at any time after the fourth anniversary of the GRANT DATE, as to an additional 25% of
the SARs subject to the AWARD, provided that the PARTICIPANT is employed by the COMPANY or a
subsidiary of the COMPANY on such date.
Subject to the other provisions of this AGREEMENT, including Section 5, if the AWARD becomes
vested and exercisable as to certain SARs, it shall remain exercisable as to those SARs until the
date of expiration of the AWARD term. The COMMITTEE may, but shall not be required to (unless
otherwise provided in this AGREEMENT or the EMPLOYMENT AGREEMENT), accelerate the vesting and
exercisability of the AWARD.
The grant of the AWARD shall not confer upon the PARTICIPANT any right to continue in the
employment of the COMPANY or any of its subsidiaries or interfere with or limit in any way the
right of the COMPANY or any of its subsidiaries to modify the terms of or terminate the employment
of the PARTICIPANT at any time in accordance with applicable law and the COMPANY’s or the
subsidiary’s governing corporate documents.
(C) AWARD Term. The AWARD shall in no event be exercisable after the expiration of
seven (7) years from the GRANT DATE and shall expire on such date.
(D) Method of Exercise. The AWARD may be exercised by giving written or electronic
notice of exercise to the COMMITTEE, in care of the Human Resources Department of the COMPANY, or
such third-party administrator as the Human Resources Department may from time to time designate,
stating the number of SARs subject to the AWARD in respect of which the AWARD is being exercised.
After proper notice has been made, and subject to Section 2(E) below, the COMPANY shall take all
such actions as are necessary to deliver an appropriate certificate or other evidence of ownership
representing the SHARES due upon the exercise of the AWARD as promptly thereafter as is reasonably
practicable.
(E) Tax Withholding. The COMPANY shall have the right to require the PARTICIPANT to
remit to the COMPANY an amount sufficient to satisfy any applicable federal, state and local tax
withholding requirements in respect of the exercise
of the AWARD. These tax withholding requirements may be satisfied in one of several ways,
including:
(i) The PARTICIPANT may give the COMPANY cash equal to the amount required to be withheld or
tender SHARES of the COMPANY already owned by the PARTICIPANT for at least six months by actual
delivery of the already-owned SHARES and having a FAIR MARKET VALUE on the exercise date equal to
the amount required to be withheld; or
(ii) The COMPANY may withhold SHARES otherwise issuable upon exercise of the AWARD having FAIR
MARKET VALUE on the exercise date equal to the amount required to be withheld (but only to the
extent of the minimum amount that must be withheld to comply with applicable state, federal and
local income, employment and wage tax laws).
3. Termination of Employment. Subject to the terms of the EMPLOYMENT AGREEMENT, if
the PARTICIPANT is terminated by the COMPANY for any reason other than for CAUSE (as defined in the
EMPLOYMENT AGREEMENT) or by the PARTICIPANT for GOOD REASON (as defined in the EMPLOYMENT
AGREEMENT), subject, except in the case of a termination of employment by reason of the
PARTICIPANT’s death or DISABILITY (as defined in the EMPLOYMENT AGREEMENT), to the PARTICIPANT
executing a release in favor of the COMPANY pursuant to Section 10(j) of the EMPLOYMENT AGREEMENT,
this AWARD shall become immediately and fully vested as of such termination date.
4. Non-Transferability of AWARD. The AWARD may not be transferred, assigned, pledged
or hypothecated (whether by operation of law or otherwise) by the PARTICIPANT, except as provided
by will or by the applicable laws of descent and distribution, and the AWARD shall not be subject
to execution, attachment or similar process.
5. Exercise After Termination of Employment.
(A) Except as the COMMITTEE may at any time provide, if the employment of the PARTICIPANT with
the COMPANY and its subsidiaries is terminated for any reason other than CAUSE, the AWARD may be
exercised (to the extent that the PARTICIPANT was entitled to do so on the date of the termination
of the PARTICIPANT’s employment and after taking into account any vesting acceleration pursuant to
Section 3 hereof or the EMPLOYMENT AGREEMENT) at any time after such termination of employment,
subject to the provisions of Section 2(C) of this AGREEMENT.
(B) If the employment of the PARTICIPANT with the COMPANY and its subsidiaries is terminated
by the COMPANY for CAUSE, the AWARD may be exercised (to the extent that the PARTICIPANT was
entitled to do so on the date of the termination of the PARTICIPANT’s employment) at any time
within three months after
such termination of employment, subject to the provisions of Section 2(C) of this AGREEMENT,
and shall then expire.
(C) To the extent the PARTICIPANT was not entitled to exercise the AWARD on the date of
termination of the PARTICIPANT’s employment, such portion of the AWARD shall expire on the date of
such termination. To the extent the PARTICIPANT was not entitled to exercise the AWARD on the date
of termination of the PARTICIPANT’s employment (after taking into account any vesting acceleration
pursuant to Section 3 hereof or the EMPLOYMENT AGREEMENT), such portion of the AWARD shall expire
on the date of such termination.
6. Forfeiture of AWARD.
(A) The AWARD shall be subject to the following additional forfeiture conditions, to which the
PARTICIPANT, by accepting the AWARD, agrees. If any of the events specified in Section 6(B)(i),
(ii), (iii) or (iv) occurs (a “FORFEITURE EVENT”), the following forfeiture will result:
(i) The unexercised portion of the AWARD held by the PARTICIPANT, whether or not vested, will
be immediately forfeited and canceled upon the occurrence of the FORFEITURE EVENT; and
(ii) The PARTICIPANT will be obligated to repay to the Company, in cash, within five business
days after demand is made therefor by the Company, the total amount of “AWARD GAIN” (as defined
below) realized by the PARTICIPANT upon each exercise of the AWARD that occurred on or after
(I) the date that is six months prior to the occurrence of the FORFEITURE EVENT, if the FORFEITURE
EVENT occurred while the PARTICIPANT was employed by the COMPANY or a subsidiary or affiliate, or
(II) the date that is six months prior to the date the PARTICIPANT’s employment by the COMPANY or a
subsidiary or affiliate terminated, if the FORFEITURE EVENT occurred after the PARTICIPANT ceased
to be so employed. For purposes of this Section, the term “AWARD GAIN” shall mean, in respect of a
given AWARD exercise, the product of (x) the FAIR MARKET VALUE per SHARE of the COMPANY at the date
of such exercise (without regard to any subsequent change in the market price of shares) minus the
BASE PRICE times (y) the number of SARs as to which the AWARD was exercised at that date.
(B) The forfeitures specified in Section 6(A) will be triggered upon the occurrence of any one
of the following FORFEITURE EVENTS at any time during PARTICIPANT’s employment by the COMPANY or a
subsidiary or affiliate, or during the one-year period following termination of such employment:
(i) PARTICIPANT, acting alone or with others, directly or indirectly, (I) engages, either as
employee, employer, consultant, advisor, or director, or as an owner, investor, partner, or
stockholder unless PARTICIPANT’s interest is insubstantial, in any business in an area or region
in which the COMPANY conducts business at the date the event occurs, which is directly in
competition with a business then conducted by
the COMPANY or a subsidiary or affiliate; (II) induces any customer or supplier of the COMPANY
or a subsidiary or affiliate, with which the COMPANY or a subsidiary or affiliate has a business
relationship, to curtail, cancel, not renew, or not continue his or her or its business with the
COMPANY or any subsidiary or affiliate; or (III) induces, or attempts to influence, any employee of
or service provider to the COMPANY or a subsidiary or affiliate to terminate such employment or
service. The COMMITTEE shall, in its discretion, determine which lines of business the COMPANY
conducts on any particular date and which third parties may reasonably be deemed to be in
competition with the COMPANY. For purposes of this Section 6(B)(i), PARTICIPANT’s interest as a
stockholder is insubstantial if it represents beneficial ownership of less than five percent of the
outstanding class of stock, and PARTICIPANT’s interest as an owner, investor, or partner is
insubstantial if it represents ownership, as determined by the COMMITTEE in its discretion, of less
than five percent of the outstanding equity of the entity;
(ii) PARTICIPANT discloses, uses, sells, or otherwise transfers, except in the course of
employment with or other service to the COMPANY or any subsidiary or affiliate, any confidential or
proprietary information of the COMPANY or any subsidiary or affiliate, including but not limited to
information regarding the COMPANY’s current and potential customers, organization, employees,
finances, and methods of operations and investments, so long as such information has not otherwise
been disclosed to the public or is not otherwise in the public domain (other than by PARTICIPANT’s
breach of this provision), except as required by law or pursuant to legal process, or PARTICIPANT
makes statements or representations, or otherwise communicates, directly or indirectly, in writing,
orally, or otherwise, or takes any other action which may, directly or indirectly, disparage or be
damaging to the COMPANY or any of its subsidiaries or affiliates or their respective officers,
directors, employees, advisors, businesses or reputations, except as required by law or pursuant to
legal process;
(iii) PARTICIPANT fails to cooperate with the COMPANY or any subsidiary or affiliate in any
way, including, without limitation, by making himself or herself available to testify on behalf of
the COMPANY or such subsidiary or affiliate in any action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, or otherwise fails to assist the COMPANY or any
subsidiary or affiliate in any way, including, without limitation, in connection with any such
action, suit, or proceeding by providing information and meeting and consulting with members of
management of, other representatives of, or counsel to, the COMPANY or such subsidiary or
affiliate, as reasonably requested; or
(iv) PARTICIPANT is found by a court of competent jurisdiction to have materially breached any
of the material terms of Section 11 of the EMPLOYMENT AGREEMENT. Notwithstanding the foregoing, the
provisions of this Section 6(B)(iv) shall not apply if a CHANGE OF CONTROL (as defined in the
EMPLOYMENT AGREEMENT) has occurred or if the PARTICIPANT’s employment has been terminated by the
COMPANY without CAUSE or by the Executive with GOOD REASON.
(C) Despite the conditions set forth in this Section 6, a PARTICIPANT is not hereby prohibited
from engaging in any activity, including but not limited to competition with the COMPANY and its
subsidiaries and affiliates. Rather, the non-occurrence of the FORFEITURE EVENTS set forth in
Section 6(B) is a condition to the PARTICIPANT’s right to realize and retain value from the AWARD,
and the consequence under the PLAN and this AGREEMENT if the PARTICIPANT engages in an activity
giving rise to any such FORFEITURE EVENTS are the forfeitures specified therein and herein. The
COMPANY and PARTICIPANT shall not be precluded by this provision or otherwise from entering into
other agreements concerning the subject matter of Sections 6(A) and 6(B).
(D) The COMMITTEE may, in its discretion, waive in whole or in part the COMPANY’s right to
forfeiture under this Section 6, but no such waiver shall be effective unless evidenced by a
writing signed by a duly authorized officer of the COMPANY.
7. Restrictions on Transfers of SHARES. Anything contained in this Agreement or
elsewhere to the contrary notwithstanding, the COMPANY may postpone the issuance and delivery of
SHARES upon any exercise of the AWARD until completion of any stock exchange listing or
registration or other qualification of such SHARES under any state or federal law, rule or
regulation as the COMPANY may consider appropriate; and may require the PARTICIPANT when exercising
the AWARD to make such representations and furnish such information as the COMPANY may consider
appropriate in connection with the issuance of the SHARES in compliance with applicable laws, rules
and regulations. SHARES issued and delivered upon exercise of the AWARD shall be subject to such
restrictions on trading, including appropriate legending of certificates to that effect, as the
COMPANY, in its discretion, shall determine are necessary to satisfy applicable laws, rules and
regulations.
8. Rights of the PARTICIPANT as a Stockholder. The PARTICIPANT shall have no rights as
a stockholder of the COMPANY with respect to any SHARES of the COMPANY covered by the AWARD until
the date of issuance to the PARTICIPANT of a certificate or other evidence of ownership
representing such SHARES.
9. PLAN as Controlling; PARTICIPANT Acknowledgments. All terms and conditions of the
PLAN and the EMPLOYMENT AGREEMENT applicable to the AWARD which are not set forth in this AGREEMENT
shall be deemed incorporated herein by reference. In the event that any term or condition of this
AGREEMENT is inconsistent with the terms and conditions of the PLAN or the EMPLOYMENT AGREEMENT,
the PLAN or the EMPLOYMENT AGREEMENT (and, as between the PLAN and the EMPLOYMENT AGREEMENT, the
EMPLOYMENT AGREEMENT) shall be deemed controlling. The PARTICIPANT acknowledges receipt of a copy
of the EMPLOYMENT AGREEMENT, the PLAN and of the Prospectus related to the PLAN. The PARTICIPANT
also acknowledges that all decisions, determinations and interpretations of the COMMITTEE in
respect of the PLAN, this AGREEMENT, the EMPLOYMENT AGREEMENT and the AWARD shall be final,
conclusive and binding on the PARTICIPANT, all other persons interested in the PLAN and
stockholders.
10. Governing Law. To the extent not preempted by federal law, this AGREEMENT shall be
governed by and construed in accordance with the laws of the State of Delaware.
11. Rights and Remedies Cumulative. All rights and remedies of the COMPANY and of the
PARTICIPANT enumerated in this AGREEMENT shall be cumulative and, except as expressly provided
otherwise in this AGREEMENT, none shall exclude any other rights or remedies allowed by law or in
equity, and each of said rights or remedies may be exercised and enforced concurrently.
12. Captions. The captions contained in this AGREEMENT are included only for
convenience of reference and do not define, limit, explain or modify this AGREEMENT or its
interpretation, construction or meaning and are in no way to be construed as a part of this
AGREEMENT.
13. Severability. If any provision of this AGREEMENT or the application of any
provision hereof to any person or any circumstance shall be determined to be invalid or
unenforceable, then such determination shall not affect any other provision of this AGREEMENT or
the application of said provision to any other person or circumstance, all of which other
provisions shall remain in full force and effect, and it is the intention of each party to this
AGREEMENT that if any provision of this AGREEMENT is susceptible of two or more constructions, one
of which would render the provision enforceable and the other or others of which would render the
provision unenforceable, then the provision shall have the meaning which renders it enforceable.
14. Number and Gender. When used in this AGREEMENT, the number and gender of each
pronoun shall be construed to be such number and gender as the context, circumstances or its
antecedent may required.
15. Entire Agreement. This AGREEMENT, including the PLAN incorporated herein by
reference, and the EMPLOYMENT AGREEMENT constitute the entire agreement between the COMPANY and the
PARTICIPANT in respect of the subject matter of this AGREEMENT, and this AGREEMENT supersedes all
prior and contemporaneous agreements between the parties hereto in connection with the subject
matter of this AGREEMENT. No officer, employee or other servant or agent of the COMPANY, and no
servant or agent of the PARTICIPANT, is authorized to make any representation, warranty or other
promise not contained in this AGREEMENT. Other than as set forth in Section 11(e) of the Plan, no
change, termination or attempted waiver of any of the provisions of this AGREEMENT shall be binding
upon either party hereto unless contained in a writing signed by the party to be charged.
16. Successors of the COMPANY. The obligations of the COMPANY under this AGREEMENT
shall be binding upon any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the COMPANY, or upon any successor corporation or
organization succeeding to substantially all of the assets and businesses of the COMPANY.
[signature page follows]
IN WITNESS WHEREOF, the COMPANY has caused this AGREEMENT to be executed by its duly
authorized officer, and the PARTICIPANT has executed this AGREEMENT, in each case effective as of
the GRANT DATE.
| COMPANY: ABERCROMBIE & FITCH CO. |
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| By: | ||||
| Its: | ||||
| Title: | ||||
| PARTICIPANT: | |||||
| Printed Name: | Xxxxxxx X. Xxxxxxxx | ||||
| Address: | |||||
