-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RCNjRmelCpdoAs4QYKHPXx6LEhpqeJLtWtqsNQlMxLrhV89xM65SmN53HfU1cIuq 6/CcJvFkmsGM8Q4CXiQrfw== 0000950152-04-007710.txt : 20041028 0000950152-04-007710.hdr.sgml : 20041028 20041028164901 ACCESSION NUMBER: 0000950152-04-007710 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20041022 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Termination of a Material Definitive Agreement ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041028 DATE AS OF CHANGE: 20041028 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ABERCROMBIE & FITCH CO /DE/ CENTRAL INDEX KEY: 0001018840 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-FAMILY CLOTHING STORES [5651] IRS NUMBER: 311469076 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12107 FILM NUMBER: 041103175 BUSINESS ADDRESS: STREET 1: 6301 FITCH PATH CITY: NEW ALBANY STATE: OH ZIP: 43054 BUSINESS PHONE: 6145776500 MAIL ADDRESS: STREET 1: 6301 FITCH PATH CITY: NEW ALBANY STATE: OH ZIP: 43054 8-K 1 l10252ae8vk.txt ABERCROMBIE & FITCH CO. 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 October 28, 2004 Date of Report (Date of earliest event reported): (October 22, 2004) ------------------------------ ABERCROMBIE & FITCH CO. ----------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 1-12107 31-1469076 -------------- ---------------- -------------- (State or other jurisdiction of (Commission File Number) (IRS Employer incorporation) Identification No.) 6301 Fitch Path, New Albany, Ohio 43054 -------------------------------------------------- (Address of principal executive offices) (Zip Code) (614) 283-6500 --------------------------------------------------- (Registrant's telephone number, including area code) Not Applicable ------------------------------ (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Section 1 - Registrant's Business and Operations. - ------------------------------------------------ Item 1.01. Entry into a Material Definitive Agreement. ------------------------------------------------------ MENDENHALL COMPENSATORY ARRANGEMENTS On October 22, 2004, Thomas D. Mendenhall ("Mendenhall") accepted Abercrombie & Fitch Co.'s (the "Registrant's") offer of employment to become Senior Vice President & General Manager - Abercrombie & Fitch and abercrombie of the Registrant. Prior to accepting such offer, Mendenhall had no business relationship with the Registrant or its subsidiaries. He had served as Worldwide Director of Merchandising for Gucci Group since 1995. The offer letter, which was executed by the Registrant on October 20, 2004, is filed as Exhibit 10.1 to this Current Report on Form 8-K (the "Mendenhall Offer Letter") and summarizes the compensatory arrangements between Mendenhall and the Registrant. Mendenhall is to receive an annual base salary of $700,000, which will be reviewed in March 2006 and at least annually thereafter. He will be paid a sign-on bonus in the amount of $50,000 (the "Sign-On Bonus"). If Mendenhall voluntarily resigns during his first 12 months of employment with the Registrant or is terminated for gross misconduct, he will be required to reimburse the Registrant for the full amount of the Sign-On Bonus. Mendenhall will be eligible to participate in the Registrant's Incentive Compensation Performance Plan (the "Incentive Compensation Plan") at a target payout level of 50% of his annual base salary, with a maximum annual payout of 100% of his annual base salary. His first payout under the Incentive Compensation Plan would occur in February 2005 in respect of the Fall 2004 selling season net income results and will be prorated based on his first day of employment with the Registrant (the "Mendenhall Employment Date"), which is currently anticipated to be November 29, 2004. On the Mendenhall Employment Date, Mendenhall will be granted non-qualified stock options ("Options") covering 75,000 shares of Class A Common Stock (the "Common Stock") of the Registrant and 15,000 restricted shares of Common Stock ("Restricted Shares"). The Options will have an exercise price equal to the closing price of the Registrant's Common Stock on the New York Stock Exchange on the Mendenhall Employment Date and become exercisable in four equal annual installments on the first, second, third and fourth anniversaries of the grant date. 2 The Restricted Shares will vest as to 10% on the first anniversary of the grant date, as to 20% on the second anniversary of the grant date, as to 30% on the third anniversary of the grant date and as to 40% on the fourth anniversary of the grant date. If the Registrant terminates Mendenhall's employment for any reason (other than resignation by Mendenhall or termination by the Registrant for cause) within 12 months of the Mendenhall Employment Date, the Registrant will continue to pay Mendenhall's base salary for a period of 12 months following the termination date. After one year of employment, Mendenhall will be eligible to participate in each of the "savings" portion and the "retirement" portion of the Abercrombie & Fitch Co. Savings & Retirement Plan (the "Qualified Plan") on the same terms as other participants in the Qualified Plan. Under the "savings" portion of the Qualified Plan, participants are eligible to defer up to 50% of their base salary and bonus (subject to the Internal Revenue Service maximum annual deferral limit for qualified plans) with the first 3% of base salary and bonus deferred (up to the Internal Revenue Service maximum considered compensation for qualified plans) matched by the Registrant at 100% and the next 2% of base salary and bonus deferred matched at 50%. Under the "retirement" portion of the Qualified Plan, participants receive an annual retirement contribution from the Registrant equal to 5% of their annual base salary below the Social Security wage base and 8% of the remainder of their annual base salary which is above the Social Security wage base but below the Internal Revenue Service maximum considered compensation for qualified plans. After 30 days of employment, Mendenhall will be eligible to participate in the "savings" portion of the Abercrombie & Fitch Nonqualified Savings and Supplemental Retirement Plan (the "Nonqualified Plan"), under which participants may defer up to 75% of their base salary each year and up to 100% of their bonus. The Registrant will match the first 3% deferred on a dollar-for-dollar basis. After one year of employment, Mendenhall will be eligible to participate in the "retirement" portion of the Nonqualified Plan, under which participants are eligible to receive an annual retirement contribution from the Registrant equal to 8% of their annual base salary which exceeds the Internal Revenue Service qualified plan considered compensation limit and a "make-up" match equal to the Registrant match forfeited in the "savings" portion of the Qualified Plan due to the Internal Revenue Service qualified plan considered compensation limit. 3 Mendenhall will also be eligible to receive group term life insurance coverage in an amount equal to four times his annual base salary, subject to a maximum of $2,000,000 coverage. On his 31st calendar day of employment, he will also be eligible to participate in the Registrant's medical, dental, life and disability insurance plans, flexible spending account plan and employee assistance programs, under the terms outlined in the Mendenhall Offer Letter. Mendenhall will also be eligible to join the Registrant's fitness facility and receive discounts on qualifying purchases at the stores operated by the Registrant's subsidiaries, under the terms outlined in the Mendenhall Offer Letter. KERNER SEPARATION ARRANGEMENTS On October 22, 2004, the Registrant received a letter of resignation from Carole L. Kerner ("Kerner") effective October 29, 2004 (the"Kerner Termination Date"). Kerner had served as Senior Vice President - General Merchandise Manager of the Registrant. Kerner will be paid her base salary through the Kerner Termination Date. Kerner will be reimbursed for relocation expenses (approximately $15,600) and will receive cash in the amount of $99,000 (less applicable taxes) representing the equivalent of the target payout she would have received under the Registrant's Incentive Compensation Plan in respect of the Fall 2004 selling season, prorated based on the Kerner Termination Date. Kerner's 15,156 restricted shares of Common Stock which will not have vested as of the Kerner Termination Date will be forfeited. Stock options covering 56,250 shares of Common Stock with an exercise price of $27.27 which will not have vested as of the Kerner Termination Date will also be forfeited by Kerner. Stock options covering 18,750 shares of Common Stock with an exercise price of $27.27 will remain exercisable by Kerner for a period of 90 days following the Kerner Termination Date. Item 1.02. Termination of a Material Definitive Agreement. ---------------------------------------------------------- The discussion under "Kerner Separation Arrangements" in "Item 1.01. Entry into a Material Definitive Agreement" of this Current Report on Form 8-K is incorporated herein by reference. Section 8 - Other Events. - ------------------------ Item 8.01. Other Events. ------------------------ On October 22, 2004, Thomas D. Mendenhall ("Mendenhall") accepted the Registrant's offer of employment to become Senior 4 Vice President & General Manager - Abercrombie & Fitch and abercrombie. A copy of the offer letter is filed as Exhibit 10.1 to this Current Report on Form 8-K. Prior to accepting such offer, Mendenhall had no business relationship with the Registrant or its subsidiaries. He had served as Worldwide Director of Merchandising for Gucci Group since 1995. On October 22, 2004, the Registrant received a letter of resignation from Carole L. Kerner ("Kerner") effective October 29, 2004. Kerner had served as Senior Vice President - General Merchandise Manager of the Registrant. On October 28, 2004, the Registrant issued a news release (the "Dividend Release") announcing that its Board of Directors had declared a quarterly dividend of $0.125 per share on the Registrant's Common Stock. The dividend is payable on December 21, 2004 to stockholders of record on November 30, 2004. A copy of the Dividend Release is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. Section 9 - Financial Statements and Exhibits. - --------------------------------------------- Item 9.01. Financial Statements and Exhibits. --------------------------------------------- (a) Financial statements of businesses acquired: Not applicable. (b) Pro forma financial information: Not applicable. (c) Exhibits: Exhibit No. Description ----------- ----------- 10.1 Letter providing terms of offer of employment, executed by Abercrombie & Fitch Co. on October 20, 2004 and accepted by Thomas D. Mendenhall on October 22, 2004 99.1 News release issued by Abercrombie & Fitch Co. on October 28, 2004 announcing declaration of quarterly cash dividend 5 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ABERCROMBIE & FITCH CO. Dated: October 28, 2004 By: /s/ Susan J. Riley ----------------------------------------- Susan J. Riley Senior Vice President-Chief Financial Officer 6 INDEX TO EXHIBITS Current Report on Form 8-K Dated October 28, 2004 Abercrombie & Fitch Co. Exhibit No. Description - ----------- ----------- 10.1 Letter providing terms of offer of employment, executed by Abercrombie & Fitch Co. on October 20, 2004 and accepted by Thomas D. Mendenhall on October 22, 2004 99.1 News release issued by Abercrombie & Fitch Co. on October 28, 2004 announcing declaration of quarterly cash dividend 7 EX-10.1 2 l10252aexv10w1.txt EXHIBIT 10.1 Exhibit 10.1 ABERCROMBIE & FITCH October 20, 2004 Tom Mendenhall XXXXXXXXXXXXXXX XXXXXXXXXXXXXXX Dear Tom: We are thrilled that you are considering joining us here at Abercrombie & Fitch, and we are excited to extend the following offer of employment: POSITION Sr. Vice President & General Manager - Abercrombie & Fitch and abercrombie BASE SALARY $700,000 annually You will be reviewed in March, 2006 and at least annually thereafter, with annual salary adjustments based on: (1) Your performance (2) Economic factors (i.e. business conditions, inflation, job market, etc.) SIGN-ON BONUS Upon hire, Abercrombie & Fitch will pay you a one-time bonus payment of $50,000. This bonus payment will be made along with your first regular paycheck. If you voluntarily resign from A&F during your first 12 months of employment, or are terminated for gross misconduct, you will be required to reimburse the Company for the full amount of the bonus. INCENTIVE BONUS COMPENSATION You will be eligible to participate in our Incentive Compensation (cash bonus) Program at a target payout level of 50% of your annual base earnings, with a maximum payout of 100% of your annual base earnings. At the income level quoted in this offer, your target annual payout is $350,000, and your maximum annual payout is $700,000. - Incentive Compensation is paid in two installments during the year (40% in August and 60% in February). Your first Incentive Compensation payout will occur in February, 2005 and will be pro rated based on your date of hire. - All Incentive Compensation (IC) payouts are based on Abercrombie and Fitch's profit results and can vary from zero (0) to a maximum of double your target level. STOCK OPTIONS Upon hire you will receive stock options covering 75,000 Abercrombie & Fitch shares of Class A common stock. The options will be valued according to the closing price of A&F Class A common stock on the New York Stock Exchange (NYSE) on your date of hire as a regular, full-time employee. Stock Options are exercisable on each anniversary date of the grant in accordance with the following vesting schedule: Year 1 Year 2 Year 3 Year 4 ------ ------ ------ ------ 25% 25% 25% 25% P.O. BOX 182168, COLUMBUS, OH 43218 - TEL (614) 283-6500 - FAX (614) 283-6565 RESTRICTED STOCK GRANT Upon your date of hire you will receive 15,000 Abercrombie & Fitch shares of restricted stocks. These shares are also exercisable on each anniversary date of the grant in accordance with the following 4 year vesting schedule: Year 1 Year 2 Year 3 Year 4 ------ ------ ------ ------ 10% 20% 30% 40% SEVERANCE IN THE EVENT OF If Abercrombie & Fitch terminates your TERMINATION employment for any reason (excluding resignation or termination for cause) within 12 months of your start date, the Company agrees to provide salary continuance for a period of 12 months from the termination date. 401(k) QUALIFIED SAVINGS PLAN After 1 year of employment, you will be eligible to participate in the Abercrombie & Fitch Qualified 401(k) Savings Plan. As a participant in this plan, you will be eligible to defer up to 50% of your base salary and bonus, or up to the IRS maximum annual deferral limit of $13,000, whichever is less. The first 3% of your base salary and bonus that you defer into this plan (up to the IRS maximum considered compensation of $205,000) will be matched by A&F at 100%. The next 2% of your base salary and bonus that you defer into this plan will be matched at 50%. At the base salary and target bonus quoted in this offer, and assuming at least a 5% base salary and target bonus deferral into the plan, this would result in an annual company match of $8,200. A&F QUALIFIED RETIREMENT PLAN Also after 1 year of employment, you will eligible to participate in the Abercrombie & Fitch Qualified Retirement Plan. As a participant in this plan, you will be eligible to receive an annual retirement plan contribution from the company equal to 5% of your annual base pay below the Social Security wage base of $87,900, and 8% of the remainder of your base pay which is above the social security wage base, but below $205,000. At the base salary quoted in this offer, this would result in a total annual qualified retirement plan contribution of $13,763. A&F NON-QUALIFIED SAVINGS PLAN After 30 days of employment, you will be eligible to participate in the Abercrombie & Fitch Non-Qualified Savings Plan. This Plan will allow you to defer up to 75% of your base salary each year, and up to 100% of your bonus. The company will match the first 3% that you defer on a dollar for dollar basis. At the base salary quoted in this offer, this would result in a company match of $31,500 on a 3% base and target bonus deferral. A&F NON-QUALIFIED RETIREMENT PLAN After 1 year of employment, you will be eligible to participate in the Abercrombie & Fitch Non-Qualified Retirement Plan. As a participant in this plan, you will be eligible to receive an annual retirement plan contribution from the company equal to 8% of your annual base pay which exceeds the IRS Qualified Plan compensation limit of $205,000. You will also receive a "make-up" match in this plan equal to the company match that you forfeit in the 401(k) Qualified Savings Plan due to the IRS Qualified Plan compensation limit of $205,000. At the base salary quoted in this offer, this would result in an annual Non-Qualified Retirement Plan contribution of $73,400. MEDICAL, DENTAL, LIFE & On your 31st calendar day of employment, DISABILITY INSURANCE you will be eligible to participate in our Medical, Dental, Life & Disability Insurance plans. The current employee contribution required for all of these benefits combined is as follows: Single Coverage $10 per week Single (+) One $20 per week Family Coverage $30 per week FLEXIBLE SPENDING ACCOUNT (FSA) On your 31st day of employment, you will be eligible to participate in A&F's Flexible Spending Account (FSA) plan. FSA's allow you to save money by paying for certain healthcare and childcare expenses with pre-tax dollars via automatic payroll deductions. EMPLOYEE ASSISTANCE PROGRAM On your 31st calendar day of employment, you will automatically be enrolled in our Employee Assistance Program. The EAP gives you or any covered dependents access to free, confidential psychological, financial, or legal counseling through our EAP provider, Matrix Psychological Services. Up to 6 free visits, per specific issue, are available through the EAP. A&F GYM Effective upon hire, you will be eligible to join The A&F Gym, our state of the art 8,000 square foot on-site fitness facility. The cost of membership is only $10 per month, which is paid via automatic payroll deduction after you enroll. EXECUTIVE LIFE INSURANCE You will be eligible to receive group INSURANCE term life insurance equal to 4 times your base annual salary (maximum of $2,000,000 coverage). MERCHANDISE DISCOUNT You will receive a discount of 40% on qualified purchases at all Abercrombie & Fitch, abercrombie, & Ruehl stores. You will also receive a discount of 30% on qualifying purchases at all Hollister Co. stores. VACATION/PERSONAL HOLIDAYS Beginning 1/1/2005, you will be eligible for 20 vacation days (four weeks) and three personal days annually. Additional vacation time accrues based on your length of service with the company. At the beginning of your 6th calendar year of employment with the company, you will receive an additional week of vacation. Total vacation eligibility at Abercrombie & Fitch is capped at 25 days (five weeks). Abercrombie & Fitch also grants 8 paid holidays to all home office associates annually. Tom, as you review this information, please call me to clarify any issues. We look forward to welcoming you to the A&F team. Sincerely, /s/ Mike Jeffries Mike Jeffries Chairman and CEO I accept Abercrombie & Fitch's offer of employment as outlined in this letter, and I am returning a signed copy to Human Resources. /s/ Tom Mendenhall 10/22/2004 - ------------------------ -------------------------- Tom Mendenhall Date EX-99.1 3 l10252aexv99w1.txt EXHIBIT 99.1 Exhibit 99.1 ABERCROMBIE & FITCH DECLARES QUARTERLY CASH DIVIDEND NEW ALBANY, Ohio / October 28, 2004 - Abercrombie & Fitch (NYSE: ANF) announced today that its Board of Directors has declared a quarterly dividend of $0.125 per share on the Company's common stock. The dividend is payable December 21, 2004 to shareholders of record on November 30, 2004. The Company operated 360 Abercrombie & Fitch stores, 173 abercrombie stores, 213 Hollister Co. stores and 3 Ruehl stores at the end of fiscal September. The Company operates e-commerce websites at www.abercrombie.com, www.abercrombiekids.com, and www.hollisterco.com. # # # # # # For further information, call: Thomas D. Lennox Director, Investor Relations and Corporate Communications (614) 283-6751 -----END PRIVACY-ENHANCED MESSAGE-----