10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 1, 2023

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file number: 001-38854

KONTOOR BRANDS, INC.

(Exact name of registrant as specified in its charter)

North Carolina	83-2680248
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification number)

400 N. Elm Street

Greensboro, North Carolina 27401

(Address of principal executive offices)

(336) 332-3400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, no par value	KTB	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.     Yes þ    No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes þ    No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐	Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ☐   No þ 

The number of shares of Common Stock of the registrant outstanding as of April 28, 2023 was 56,078,513.

KONTOOR BRANDS, INC.

Table of Contents

	Page
Part I — Financial Information
Item 1. Financial Statements (Unaudited)	3
Consolidated Balance Sheets: March 2023, December 2022 and March 2022	3
Consolidated Statements of Operations: Three months ended March 2023 and March 2022	4
Consolidated Statements of Comprehensive Income: Three months ended March 2023 and March 2022	5
Consolidated Statements of Cash Flows: Three months ended March 2023 and March 2022	6
Consolidated Statements of Equity: Three months ended March 2023 and March 2022	7
Notes to Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3. Quantitative and Qualitative Disclosures about Market Risk	29
Item 4. Controls and Procedures	29
Part II — Other Information
Item 1. Legal Proceedings	30
Item 1A. Risk Factors	30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 6. Exhibits	31
Signatures	32

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 2

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

KONTOOR BRANDS, INC.

Consolidated Balance Sheets

(Unaudited)

(In thousands, except share amounts)	March 2023		December 2022		March 2022
ASSETS
Current assets
Cash and cash equivalents	$	52,677	$	59,179	$	193,630
Accounts receivable, net	224,024		225,858		276,037
Inventories	660,089		596,836		432,891
Prepaid expenses and other current assets	102,757		100,396		82,495
Total current assets	1,039,547		982,269		985,053
Property, plant and equipment, net	104,999		104,465		101,380
Operating lease assets	55,116		51,029		47,759
Intangible assets, net	13,173		13,361		14,248
Goodwill	209,904		209,627		211,504
Other assets	220,831		221,510		229,110
TOTAL ASSETS	$	1,643,570	$	1,582,261	$	1,589,054
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings	$	7,255	$	7,280	$	239
Current portion of long-term debt	12,500		10,000		2,500
Accounts payable	163,871		206,262		266,974
Accrued liabilities	197,203		196,989		198,777
Operating lease liabilities, current	21,241		19,898		22,563
Total current liabilities	402,070		440,429		491,053
Operating lease liabilities, noncurrent	32,472		31,506		26,511
Other liabilities	81,796		76,950		98,257
Long-term debt	827,944		782,619		789,143
Commitments and contingencies
Total liabilities	1,344,282		1,331,504		1,404,964
Equity
Preferred Stock, no par value; shares authorized, 90,000,000; no shares outstanding at March 2023, December 2022 and March 2022	—		—		—
Common Stock, no par value; shares authorized, 600,000,000; shares outstanding of 55,933,661 at March 2023; 55,516,872 at December 2022 and 56,276,243 at March 2022	—		—		—
Additional paid-in capital	251,108		243,696		224,721
Retained earnings	116,185		86,726		43,066
Accumulated other comprehensive loss	(68,005)		(79,665)		(83,697)
Total equity	299,288		250,757		184,090
TOTAL LIABILITIES AND EQUITY	$	1,643,570	$	1,582,261	$	1,589,054

See accompanying notes to unaudited consolidated financial statements.

3 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Consolidated Statements of Operations

(Unaudited)

	Three Months Ended March
(In thousands, except per share amounts)		2023		2022
Net revenues		$	667,123	$	679,743
Costs and operating expenses
Cost of goods sold		380,422		375,122
Selling, general and administrative expenses		191,752		196,400
Total costs and operating expenses		572,174		571,522
Operating income		94,949		108,221
Interest expense		(10,273)		(8,023)
Interest income		419		469
Other expense, net		(2,226)		(222)
Income before income taxes		82,869		100,445
Income taxes		16,573		19,635
Net income		$	66,296	$	80,810
Earnings per common share
Basic		$	1.19	$	1.43
Diluted		$	1.16	$	1.40
Weighted average shares outstanding
Basic		55,646		56,321
Diluted		56,940		57,836

See accompanying notes to unaudited consolidated financial statements.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 4

KONTOOR BRANDS, INC.

Consolidated Statements of Comprehensive Income

(Unaudited)

	Three Months Ended March
(In thousands)		2023		2022
Net income		$	66,296	$	80,810
Other comprehensive income
Net change in foreign currency translation		8,323		(3,615)
Net change in defined benefit pension plans		(35)		6
Net change in derivative financial instruments		3,372		12,668
Total other comprehensive income, net of related taxes		11,660		9,059
Comprehensive income		$	77,956	$	89,869

See accompanying notes to unaudited consolidated financial statements.

5 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Consolidated Statements of Cash Flows

(Unaudited)

	Three Months Ended March
(In thousands)	2023		2022
OPERATING ACTIVITIES
Net income	$	66,296	$	80,810
Adjustments to reconcile net income to cash (used) provided by operating activities:
Depreciation and amortization	9,127		9,862
Stock-based compensation	1,002		5,730
Provision for doubtful accounts	1,877		1,757
Other	2,642		3,422
Changes in operating assets and liabilities:
Accounts receivable	2,851		9,990
Inventories	(59,903)		(70,183)
Accounts payable	(42,965)		54,109
Income taxes	12,237		12,201
Accrued liabilities	(11,259)		(34,642)
Other assets and liabilities	5,473		1,777
Cash (used) provided by operating activities	(12,622)		74,833
INVESTING ACTIVITIES
Property, plant and equipment expenditures	(6,463)		(2,885)
Capitalized computer software	(5,483)		(2,112)
Other	149		(31)
Cash used by investing activities	(11,797)		(5,028)
FINANCING ACTIVITIES
Borrowings under revolving credit facility	178,000		—
Repayments under revolving credit facility	(128,000)		—
Repayments of term loan	(2,500)		—
Repurchases of Common Stock	—		(22,513)
Dividends paid	(26,808)		(26,033)
Shares withheld for taxes, net of proceeds from issuance of Common Stock	(3,619)		(11,102)
Other	(57)		(298)
Cash provided (used) by financing activities	17,016		(59,946)
Effect of foreign currency rate changes on cash and cash equivalents	901		(1,551)
Net change in cash and cash equivalents	(6,502)		8,308
Cash and cash equivalents – beginning of period	59,179		185,322
Cash and cash equivalents – end of period	$	52,677	$	193,630

See accompanying notes to unaudited consolidated financial statements.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 6

KONTOOR BRANDS, INC.

Consolidated Statements of Equity

(Unaudited)

	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
(In thousands, except per share amounts)	Shares	Amounts
Balance, December 2022	55,517	$	—	$	243,696	$	86,726	$	(79,665)	$	250,757
Net income	—	—		—		66,296		—		66,296
Stock-based compensation, net	417	—		7,412		(10,029)		—		(2,617)
Other comprehensive income	—	—		—		—		11,660		11,660
Dividends on Common Stock ($0.48 per share)	—	—		—		(26,808)		—		(26,808)
Balance, March 2023	55,934	$	—	$	251,108	$	116,185	$	(68,005)	$	299,288

	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
(In thousands, except per share amounts)	Shares	Amounts
Balance, December 2021	56,381	$	—	$	218,259	$	22,635	$	(92,756)	$	148,138
Net income	—	—		—		80,810		—		80,810
Stock-based compensation, net	387	—		6,462		(11,833)		—		(5,371)
Other comprehensive income	—	—		—		—		9,059		9,059
Dividends on Common Stock ($0.46 per share)	—	—		—		(26,033)		—		(26,033)
Repurchases of Common Stock	(492)	—		—		(22,513)		—		(22,513)
Balance, March 2022	56,276	$	—	$	224,721	$	43,066	$	(83,697)	$	184,090

See accompanying notes to unaudited consolidated financial statements.

7 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 — BASIS OF PRESENTATION

Description of Business

Kontoor Brands, Inc. ("Kontoor," the "Company," "we," "us" or "our") is a global lifestyle apparel company headquartered in the United States ("U.S."). The Company designs, produces, procures, markets, distributes and licenses apparel, footwear and accessories, primarily under the brand names Wrangler® and Lee®. The Company's products are sold in the U.S. through mass merchants, specialty stores, mid-tier and traditional department stores, company-operated stores and online. The Company's products are also sold internationally, primarily in the Europe and Asia-Pacific regions, through department, specialty, company-operated, concession retail and independently-operated partnership stores and online.

Fiscal Year

The Company operates and reports using a 52/53-week fiscal year ending on the Saturday closest to December 31 of each year. Accordingly, this Form 10-Q presents the first quarter of the Company's fiscal year ending December 30, 2023 ("fiscal 2023"), which is a 52-week fiscal year. For presentation purposes herein, all references to periods ended March 2023, December 2022 and March 2022 correspond to the fiscal periods ended April 1, 2023, December 31, 2022 and April 2, 2022, respectively.

Macroeconomic Environment and Other Recent Developments

Macroeconomic conditions, including inflation, rising interest rates, recessionary concerns, fluctuating foreign currency exchange rates and distress in global credit and banking markets, as well as ongoing global supply chain disruptions, labor challenges and the COVID-19 pandemic, continue to adversely impact global economic conditions, as well as the Company's operations. Additionally, the conflict between Russia and Ukraine continues to cause disruption in the surrounding areas and greater uncertainty in the global economy. The Company considered the impact of these developments on the assumptions and estimates used when preparing these quarterly financial statements including, but not limited to, our allowance for doubtful accounts, inventory valuations, liabilities for variable consideration, deferred tax valuation allowances, fair value measurements including asset impairment evaluations, the effectiveness of the Company’s hedging instruments and expected compliance with all applicable financial covenants in our Credit Agreement (as defined in Note 7 to the Company's financial statements). These assumptions and estimates may change as new events occur and additional information is obtained regarding the impact of the above conditions. Such future changes may have an adverse impact on the Company's results of operations, financial position and liquidity.

Basis of Presentation - Interim Financial Statements

The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and do not include all of the information and notes required by generally accepted accounting principles in the U.S. ("GAAP") for complete financial statements. In the opinion of management, the accompanying financial statements contain all normal and recurring adjustments necessary to fairly state the financial position, results of operations and cash flows of the Company for the interim periods presented. Operating results for the three months ended March 2023 are not necessarily indicative of results that may be expected for any other interim period or for fiscal 2023. The unaudited financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the Securities and Exchange Commission on March 1, 2023 ("2022 Annual Report on Form 10-K").

Recently Adopted Accounting Standards

In September 2022, the Financial Accounting Standards Board issued Accounting Standards Update 2022-04, "Disclosure of Supplier Finance Program Obligations," which requires entities that use supplier finance programs in connection with the purchase of goods and services to disclose key terms of the programs, outstanding confirmed amounts as of period end, a description of where those obligations are presented in the balance sheet and an annual rollforward of obligations. This guidance was adopted by the Company during the first quarter of 2023, except for the requirement to include a rollforward of obligations which is effective beginning in 2024 with early adoption permitted. Refer to Note 6 to the Company's financial statements for additional information related to supplier finance program obligations.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 8

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 2 — REVENUES

Disaggregation of Revenue

The following tables present revenues disaggregated by channel and geography. Revenues from licensing arrangements are included within the U.S. or Non-U.S. Wholesale channels, based on the respective region where the licensee sells the product. Direct-to-Consumer revenues include sales at company-operated Wrangler® and Lee® branded full-price and outlet stores, digital sales at www.wrangler.com and www.lee.com and sales from international concession arrangements.

Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

	Three Months Ended March 2023
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	337,676	$	135,299	$	3,228	$	476,203
Non-U.S. Wholesale	51,919		66,005		10		117,934
Direct-to-Consumer	33,552		39,345		89		72,986
Total	$	423,147	$	240,649	$	3,327	$	667,123
Geographic revenues
U.S.	$	365,129	$	149,690	$	3,317	$	518,136
International	58,018		90,959		10		148,987
Total	$	423,147	$	240,649	$	3,327	$	667,123

	Three Months Ended March 2022
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	330,652	$	136,806	$	2,527	$	469,985
Non-U.S. Wholesale	52,819		91,051		501		144,371
Direct-to-Consumer	28,952		36,363		72		65,387
Total	$	412,423	$	264,220	$	3,100	$	679,743
Geographic revenues
U.S.	$	354,393	$	150,116	$	2,599	$	507,108
International	58,030		114,104		501		172,635
Total	$	412,423	$	264,220	$	3,100	$	679,743

Contract Balances and Performance Obligations

The following table presents information about contract balances recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Accounts receivable, net	$	224,024	$	225,858	$	276,037
Contract assets (a)	5,317		5,050		4,311
Contract liabilities (b)	1,392		1,057		1,787

(a) Included within "prepaid expenses and other current assets" in the Company's balance sheets.

(b) Included within "accrued liabilities" in the Company's balance sheets.

For the three months ended March 2023 and March 2022, revenue recognized that was included in contract liabilities as of December 2022 and December 2021, respectively, was not significant.

As of March 2023, the Company has contractual rights under its licensing agreements to receive $52.2 million of fixed consideration related to the future minimum guarantees through December 2028. As of March 2023, there were no arrangements with any

9 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

transaction price allocated to remaining performance obligations other than (i) contracts for which the Company has applied the practical expedients and (ii) fixed consideration related to future minimum guarantees. For the three months ended March 2023, revenue recognized from performance obligations satisfied, or partially satisfied, in prior periods was not significant. The variable consideration under these arrangements is not disclosed as a remaining performance obligation as the licensing arrangements qualify for the sales-based royalty exemption.

NOTE 3 — BUSINESS SEGMENT INFORMATION

The Company has two reportable segments:

•Wrangler — Wrangler® branded denim, apparel, footwear and accessories.

•Lee — Lee® branded denim, apparel, footwear and accessories.

The Company considers its chief executive officer to be its chief operating decision maker. The chief operating decision maker allocates resources and assesses performance based on the global brand operating results of Wrangler® and Lee®, which are the Company's operating and reportable segments.

In addition, we report an "Other" category to reconcile segment revenues and segment profit to the Company's operating results, but the Other category does not meet the criteria to be considered a reportable segment. Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

Accounting policies utilized for internal management reporting at the individual segments are consistent with those disclosed in the Company's 2022 Annual Report on Form 10-K. Corporate and other expenses and interest income and expense are not controlled by segment management and therefore are excluded from the measurement of segment profit.

The following table presents financial information for the Company's reportable segments and income before income taxes:

	Three Months Ended March
(In thousands)		2023		2022
Segment revenues:
Wrangler		$	423,147	$	412,423
Lee		240,649		264,220
Total reportable segment revenues		663,796		676,643
Other revenues		3,327		3,100
Total net revenues		$	667,123	$	679,743
Segment profit:
Wrangler		$	71,107	$	75,388
Lee		39,573		52,230
Total reportable segment profit		$	110,680	$	127,618
Corporate and other expenses		(18,064)		(19,982)
Interest expense		(10,273)		(8,023)
Interest income		419		469
Profit related to other revenues		107		363
Income before income taxes		$	82,869	$	100,445

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 10

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 4 — ACCOUNTS RECEIVABLE

Allowance for Doubtful Accounts

The following table presents a rollforward of the allowance for doubtful accounts:

	Three Months Ended March
(In thousands)		2023		2022
Balance, December		$	9,918	$	11,705
Provisions for expected credit losses		1,877		1,757
Accounts receivable balances written off		(560)		(153)
Other (1)		233		(284)
Balance, March		$	11,468	$	13,025

(1) Other primarily includes the impact of foreign currency translation and recoveries of amounts previously written off, none of which were individually significant.

Sale of Trade Accounts Receivable

The Company is party to an agreement with a financial institution to sell selected trade accounts receivable on a nonrecourse basis. Under this agreement, up to $377.5 million of the Company’s trade accounts receivable may be sold to the financial institution and remain outstanding at any point in time. The Company removes the sold balances from "accounts receivable, net" in its balance sheet at the time of sale. The Company does not retain any interests in the sold trade accounts receivable but continues to service and collect outstanding trade accounts receivable on behalf of the financial institution.

During the three months ended March 2023 and March 2022, the Company sold total trade accounts receivable of $359.7 million and $355.5 million, respectively. As of March 2023, December 2022 and March 2022, $256.3 million, $246.0 million and $227.0 million, respectively, of the sold trade accounts receivable had been removed from the Company's balance sheets but remained outstanding with the financial institution.

The funding fees charged by the financial institution for this program are reflected in the Company's statements of operations within "other expense, net" and were $3.0 million and $0.6 million for the three months ended March 2023 and March 2022, respectively. Net proceeds of this program are reflected as operating activities in the Company's statements of cash flows.

NOTE 5 — INVENTORIES

The following table presents components of "inventories" recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Finished products	$	577,143	$	509,554	$	346,160
Work-in-process	32,857		34,316		40,310
Raw materials	50,089		52,966		46,421
Total inventories	$	660,089	$	596,836	$	432,891

11 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 6 — SUPPLY CHAIN FINANCING

The Company facilitates a voluntary Supply Chain Finance ("SCF") program with its financial institutions that allows certain suppliers the option to sell or assign their rights to receivables due from the Company, enabling the suppliers to receive payment from the financial institutions sooner than our negotiated payment terms. Participation in the SCF program is based on terms and conditions negotiated directly between the suppliers and the financial institutions. The Company agrees to commercial terms with suppliers independent of their participation in the SCF program, and thus their participation has no impact on our payment terms. The Company is not a party to the agreements between our suppliers and the financial institutions, and has no economic interest in our suppliers' decision to participate in the SCF program. For suppliers who participate in the SCF program, they have sole discretion to determine which invoices, if any, are to be sold to the financial institutions. All amounts payable to suppliers who participate in the SCF program are included within "accounts payable" in the Company's balance sheets, and the Company's associated payments to the suppliers are included in operating activities in the Company's statements of cash flows. At March 2023, December 2022 and March 2022, accounts payable included total outstanding balances of $23.9 million, $24.7 million and $16.7 million, respectively, due to suppliers that participate in the SCF program.

NOTE 7 — SHORT-TERM BORROWINGS AND LONG-TERM DEBT

Short-term Borrowings

At March 2023, December 2022 and March 2022, the Company had $24.9 million, $24.8 million and $10.0 million, respectively, of international lines of credit with various banks, which are uncommitted and may be terminated at any time by either the Company or the banks. There was a total outstanding balance of $7.1 million under these arrangements at both March 2023 and December 2022, and no outstanding balance at March 2022. In addition, short-term borrowings included other debt of $0.2 million at March 2023, December 2022 and March 2022.

Long-term Debt

The following table presents the components of "long-term debt" as recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Revolving Credit Facility	$	50,000	$	—	$	—
Term Loan A	395,586		397,954		397,559
4.125% Notes, due 2029	394,858		394,665		394,084
Total long-term debt	840,444		792,619		791,643
Less: current portion	(12,500)		(10,000)		(2,500)
Long-term debt, due beyond one year	$	827,944	$	782,619	$	789,143

Credit Facilities

On November 18, 2021, the Company completed a refinancing pursuant to which it issued $400.0 million of Notes (as defined below) and amended and restated its senior secured Credit Agreement (the “Credit Agreement”). The Credit Agreement provides for (i) a five-year $400.0 million term loan A facility (“Term Loan A”), with quarterly mandatory repayments which commenced in March 2023 and (ii) a five-year $500.0 million revolving credit facility (the “Revolving Credit Facility”) (collectively, the “Credit Facilities”) with the lenders and agents party thereto.

Term Loan A had an outstanding principal amount of $397.5 million at March 2023, and $400.0 million at both December 2022 and March 2022, which is reported net of unamortized deferred financing costs. As of March 2023, interest expense on Term Loan A was being recorded at an effective annual interest rate of 4.3%, including the amortization of deferred financing costs and the impact of the Company’s interest rate swap.

The Revolving Credit Facility may be used to borrow funds in both U.S. dollar and certain non-U.S. dollar currencies, and has a $75.0 million letter of credit sublimit. As of March 2023, the Company had $50.0 million of outstanding borrowings under the Revolving Credit Facility and $11.7 million of outstanding standby letters of credit issued on behalf of the Company, leaving $438.3 million available for borrowing against this facility.

The interest rate per annum applicable to the Credit Agreement is an interest rate benchmark elected by the Company based on the currency and term of the borrowing plus an applicable margin, as defined therein.

The Credit Agreement contains certain affirmative and negative covenants customary for financings of this type as well as customary events of default. In addition, the Credit Agreement contains financial covenants which require compliance with (i) a total leverage ratio not to exceed 4.50 to 1.00 as of the last day of any test period, with an allowance for up to two elections to increase the limit to

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 12

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

5.00 to 1.00 in connection with certain material acquisitions, and (ii) a consolidated interest coverage ratio as of the last day of any test period to be no less than 3.00 to 1.00. As of March 2023, the Company was in compliance with all covenants and expects to maintain compliance with the applicable covenants for at least one year from the issuance of these financial statements.

Senior Notes

On November 18, 2021, the Company entered into an indenture (the “Indenture”) by and among the Company and certain subsidiaries of the Company named as guarantors therein (the “Guarantors”), pursuant to which it issued $400.0 million of unsecured senior notes due November 2029 (the “Notes”) through a private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended. The Notes bear interest at a fixed rate of 4.125% per annum, payable in cash in arrears on May 15 and November 15 of each year.

The Notes had an outstanding principal amount of $400.0 million at March 2023, December 2022 and March 2022, which is reported net of unamortized deferred financing costs. As of March 2023, interest expense on the Notes was being recorded at an effective annual interest rate of 4.3%, including the amortization of deferred financing costs.

The Notes are guaranteed on a senior unsecured basis by the Company’s existing and future domestic subsidiaries (other than certain excluded subsidiaries) that are borrowers under or guarantors of the Credit Facilities or certain other indebtedness. The Indenture governing the Notes contains customary negative covenants for financings of this type. The Indenture does not contain any financial covenants. As of March 2023, the Company was in compliance with the Indenture and expects to maintain compliance with the applicable covenants for at least one year from the issuance of these financial statements.

Refer to Note 10 in the Company's 2022 Annual Report on Form 10-K for additional information regarding the Company’s debt obligations.

NOTE 8 — FAIR VALUE MEASUREMENTS

Certain assets and liabilities measured and reported at fair value are classified in a three-level hierarchy that prioritizes the inputs used in the valuation process. Categorization within the valuation hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The hierarchy is based on the observability and objectivity of the pricing inputs, as follows:

•Level 1 — Quoted prices in active markets for identical assets or liabilities.

•Level 2 — Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable data through corroboration with observable market data. Inputs would normally be (i) quoted prices in active markets for similar assets or liabilities, (ii) quoted prices in inactive markets for identical or similar assets or liabilities or (iii) information derived from or corroborated by observable market data.

•Level 3 — Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be the Company's own data and judgments about assumptions that market participants would use in pricing the asset or liability.

Recurring Fair Value Measurements

The following tables present financial assets and financial liabilities that are measured and recorded in the Company's financial statements at fair value on a recurring basis:

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
March 2023
Financial assets:
Cash equivalents:
Money market funds	$	25,798	$	25,798	$	—	$	—
Time deposits	2,079		2,079		—		—
Foreign currency exchange contracts	20,377		—		20,377		—
Interest rate swap agreements	8,946		—		8,946		—
Investment securities	46,641		46,641		—		—
Financial liabilities:
Foreign currency exchange contracts	3,230		—		3,230		—
Deferred compensation	48,539		—		48,539		—

13 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
December 2022
Financial assets:
Cash equivalents:
Money market funds	$	20,097	$	20,097	$	—	$	—
Time deposits	2,194		2,194		—		—
Foreign currency exchange contracts	15,565		—		15,565		—
Interest rate swap agreements	11,357		—		11,357		—
Investment securities	43,131		43,131		—		—
Financial liabilities:
Foreign currency exchange contracts	2,307		—		2,307		—
Deferred compensation	44,589		—		44,589		—

The Company's cash equivalents include money market funds and short-term time deposits that approximate fair value based on Level 1 measurements. The fair value of derivative financial instruments, which consist of foreign currency exchange contracts and interest rate swap agreements, is determined based on observable market inputs (Level 2), including spot and forward exchange rates for foreign currencies and observable interest rate yield curves for interest rate swap agreements. Investment securities are held in the Company's deferred compensation plans as an economic hedge of the related deferred compensation liabilities and are comprised of mutual funds that are valued based on quoted prices in active markets (Level 1). Liabilities related to the Company's deferred compensation plans are recorded at amounts due to participants, based on the fair value of the participants’ selection of hypothetical investments (Level 2).

Additionally, at March 2023, the carrying value of the Company's long-term debt was $840.4 million compared to a fair value of $785.5 million. At December 2022, the carrying value of the Company's long-term debt was $792.6 million compared to a fair value of $718.0 million. The fair value of long-term debt is a Level 2 estimate based on quoted market prices or values of comparable borrowings.

All other financial assets and financial liabilities are recorded in the Company's financial statements at cost. These other financial assets and financial liabilities include cash held as demand deposits, accounts receivable, short-term borrowings, accounts payable, and accrued liabilities. At March 2023 and December 2022, their carrying values approximated fair value due to the short-term nature of these instruments.

NOTE 9 — DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

Summary of Derivative Financial Instruments

The Company enters into derivative contracts with external counterparties to hedge certain foreign currency transactions. The notional amount of all outstanding foreign currency exchange contracts was $321.3 million at March 2023, $322.3 million at December 2022 and $287.5 million at March 2022, consisting primarily of contracts hedging exposures to the euro, Mexican peso, Canadian dollar, British pound, Polish zloty and Swedish krona. Foreign currency exchange contracts have maturities up to 20 months.

During 2019, the Company entered into "floating to fixed" interest rate swap agreements to mitigate exposure to volatility in reference rates on the Company's future interest payments. The notional amount of the interest rate swap agreements was $300.0 million at March 2023, December 2022 and March 2022. Because these interest rate swap agreements meet the criteria for hedge accounting, all related gains and losses are deferred within accumulated other comprehensive loss ("AOCL") and are being amortized through April 18, 2024.

The Company's outstanding derivative financial instruments met the criteria for hedge accounting at the inception of the hedging relationship. At each reporting period, the Company assesses whether the hedging relationships continue to be highly effective in offsetting changes in cash flows of hedged items. If the Company determines that a specific hedging relationship has ceased to be highly effective, it would discontinue hedge accounting. All designated hedging relationships were determined to be highly effective as of March 2023.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 14

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

The following table presents the fair value of outstanding derivatives on an individual contract basis:

	Fair Value of Derivatives with Unrealized Gains						Fair Value of Derivatives with Unrealized Losses
	March		December		March		March		December		March
(In thousands)	2023		2022		2022		2023		2022		2022
Derivatives designated as hedging instruments:
Foreign currency exchange contracts	$	20,361	$	15,565	$	11,041	$	(2,914)	$	(2,307)	$	(1,073)
Interest rate swap agreements	8,946		11,357		4,309		—		—		—
Derivatives not designated as hedging instruments:
Foreign currency exchange contracts	16		—		131		(316)		—		(2)
Total derivatives	$	29,323	$	26,922	$	15,481	$	(3,230)	$	(2,307)	$	(1,075)

The Company records and presents the fair value of all derivative assets and liabilities in the Company's balance sheets on a gross basis, even though certain derivative contracts are subject to master netting agreements. If the Company were to offset and record the asset and liability balances of its derivative contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Company's balance sheets would be adjusted from the current gross presentation to the net amounts.

The following table presents a reconciliation of gross to net amounts for derivative asset and liability balances:

	March 2023				December 2022				March 2022
(In thousands)	Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability
Gross amounts presented in the balance sheet	$	29,323	$	(3,230)	$	26,922	$	(2,307)	$	15,481	$	(1,075)
Gross amounts not offset in the balance sheet	(1,449)		1,449		(1,629)		1,629		(938)		938
Net amounts	$	27,874	$	(1,781)	$	25,293	$	(678)	$	14,543	$	(137)

The following table presents the location of derivatives in the Company's balance sheets, with current or noncurrent classification based on maturity dates:

(In thousands)	March 2023		December 2022		March 2022
Prepaid expenses and other current assets	$	18,046	$	14,183	$	9,424
Accrued liabilities	(2,683)		(1,218)		(838)
Other assets	11,277		12,739		6,057
Other liabilities	(547)		(1,089)		(237)

15 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

Cash Flow Hedges

The following tables present the pre-tax effects of cash flow hedges included in the Company's statements of operations and statements of comprehensive income:

	Gain (Loss) on Derivatives Recognized in AOCL
(In thousands)	Three Months Ended March
Cash Flow Hedging Relationships		2023		2022
Foreign currency exchange contracts		$	10,337	$	7,325
Interest rate swap agreements		(309)		9,095
Total		$	10,028	$	16,420

	Gain (Loss) Reclassified from AOCL into Income
(In thousands)	Three Months Ended March
Location of Gain (Loss)		2023		2022
Net revenues		$	(171)	$	(132)
Cost of goods sold		5,992		2,301
Other expense, net		160		(103)
Interest expense		2,101		(1,266)
Total		$	8,082	$	800

Other Derivative Information

Any contracts that are not designated as hedges are recorded at fair value in the Company's balance sheets. Changes in the fair values of derivative contracts not designated as hedges are recognized directly in earnings. There were no significant amounts recognized in earnings for the ineffective portion of any hedging relationships or changes in the fair values of derivative contracts not designated as hedges during the three months ended March 2023 and March 2022.

At March 2023, AOCL included $28.3 million of pre-tax net deferred gains for foreign currency exchange contracts and interest rate swap agreements that are expected to be reclassified to earnings during the next 12 months. The amounts ultimately reclassified to earnings will depend on rates in effect when outstanding derivative contracts are settled.

NOTE 10 — ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table presents deferred components of AOCL in equity, net of related taxes:

(In thousands)	March 2023		December 2022		March 2022
Foreign currency translation	$	(99,139)	$	(107,462)	$	(96,740)
Defined benefit pension plans	2,208		2,243		(2,171)
Derivative financial instruments	28,926		25,554		15,214
Accumulated other comprehensive loss	$	(68,005)	$	(79,665)	$	(83,697)

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 16

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

The following tables present changes in AOCL, net of related tax impact:

	Three Months Ended March 2023
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2022	$	(107,462)	$	2,243	$	25,554	$	(79,665)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	8,323		—		10,292		18,615
Reclassifications to net income of previously deferred (gains) losses	—		(35)		(6,920)		(6,955)
Net other comprehensive income (loss)	8,323		(35)		3,372		11,660
Balance, March 2023	$	(99,139)	$	2,208	$	28,926	$	(68,005)

	Three Months Ended March 2022
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2021	$	(93,125)	$	(2,177)	$	2,546	$	(92,756)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	(3,615)		—		13,814		10,199
Reclassifications to net income of previously deferred (gains) losses	—		6		(1,146)		(1,140)
Net other comprehensive income (loss)	(3,615)		6		12,668		9,059
Balance, March 2022	$	(96,740)	$	(2,171)	$	15,214	$	(83,697)

The following table presents reclassifications out of AOCL:

(In thousands)		Three Months Ended March
Details About Accumulated Other Comprehensive Loss Reclassifications	Affected Line Item in the Financial Statements
			2023		2022
Defined benefit pension plans:
Net change in deferred gains (losses) during the period	Selling, general and administrative expenses		$	46	$	(8)
Total before tax			46		(8)
Income taxes	Income taxes		(11)		2
Net of tax			35		(6)
Gains (losses) on derivative financial instruments:
Foreign currency exchange contracts	Net revenues		$	(171)	$	(132)
Foreign currency exchange contracts	Cost of goods sold		5,992		2,301
Foreign currency exchange contracts	Other expense, net		160		(103)
Interest rate swap agreements	Interest expense		2,101		(1,266)
Total before tax			8,082		800
Income taxes	Income taxes		(1,162)		346
Net of tax			6,920		1,146
Total reclassifications for the period, net of tax			$	6,955	$	1,140

17 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 11 — STOCK-BASED COMPENSATION

On April 1, 2023, the Company made its annual grant of equity awards under the Kontoor Brands, Inc. 2019 Stock Compensation Plan, including approximately 230,000 shares of performance-based restricted stock units ("PRSUs”) to employees, approximately 180,000 shares of time-based restricted stock units ("RSUs") to employees, and approximately 20,000 shares of RSUs to nonemployee members of the Board of Directors. The fair market value of Kontoor Common Stock at the date the awards were granted was $48.39 per share and was used to value the RSUs and Director RSUs.

Each PRSU entitles the employee to receive a potential final payout ranging from zero to two shares of Kontoor Common Stock at the end of a three-year performance period. The number of shares earned by participants, if any, is based on achievement of performance goals set by the Talent and Compensation Committee of the Board of Directors. The actual number of shares earned may also be adjusted upward or downward by 25%, subject to a 0% floor, of the target award based on how Kontoor’s total shareholder return (“TSR”) over a three-year period compares to the TSR for companies included in a Company-selected peer group. Shares earned related to the 2023 grants will be issued to participants following the conclusion of the three-year performance period.

Each employee RSU entitles the holder to one share of Kontoor Common Stock and typically vests over a three-year period. Each RSU granted to a nonemployee member of the Board of Directors vests upon grant and will be settled in one share of Kontoor Common Stock one year from the date of grant.

NOTE 12 — INCOME TAXES

The effective income tax rate for the three months ended March 2023 was 20.0% compared to 19.5% in the 2022 period. The three months ended March 2023 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 0.2%. The three months ended March 2022 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 1.1%. The effective tax rate without discrete items for the three months ended March 2023 was 20.2% compared to 20.6% in the 2022 period. The decrease was primarily due to changes in our jurisdictional mix of earnings.

During the three months ended March 2023, the amount of net unrecognized tax benefits and associated interest increased by $0.3 million to $15.3 million. Management believes that it is reasonably possible that the amount of unrecognized tax benefits may decrease by $2.5 million within the next 12 fiscal months due to settlements of audits and expiration of statutes of limitations, all of which would reduce income tax expense.

On April 5, 2023, the Company was granted a tax holiday from local income taxes in a foreign jurisdiction through 2031. The associated tax effects, including approximately $5.5 million of tax expense related to the remeasurement of deferred tax assets in this jurisdiction, will be reflected in the second quarter of 2023.

NOTE 13 — EARNINGS PER SHARE

The calculations of basic and diluted earnings per share ("EPS") are based on net income divided by the basic weighted average number of common shares and diluted weighted average number of common shares outstanding, respectively.

The following table presents the calculations of basic and diluted EPS:

	Three Months Ended March
(In thousands, except per share amounts)		2023		2022
Net income		$	66,296	$	80,810
Basic weighted average shares outstanding		55,646		56,321
Dilutive effect of stock-based awards		1,294		1,515
Diluted weighted average shares outstanding		56,940		57,836
Earnings per share:
Basic earnings per common share		$	1.19	$	1.43
Diluted earnings per common share		$	1.16	$	1.40

For the three months ended March 2023 and March 2022, an immaterial number of shares were excluded from the dilutive earnings per share calculations because the effect of their inclusion would have been anti-dilutive.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 18

KONTOOR BRANDS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

For the three months ended March 2023, a total of 0.6 million shares of PRSUs were excluded from the calculations of diluted earnings per share as the units were not considered to be contingent outstanding shares. For the three months ended March 2022, an immaterial number of shares of PRSUs were excluded from the calculations of diluted earnings per share as the units were not considered to be contingent outstanding shares.

NOTE 14 — LEASES

The Company enters into operating leases for retail stores, operational facilities, vehicles and certain equipment, with terms expiring at various dates through 2033. Most leases have fixed rentals, with many of the real estate leases requiring additional payments for real estate taxes and occupancy-related costs.

The following table presents supplemental cash flow and non-cash information related to operating leases:

	Three Months Ended March
(In thousands)		2023		2022
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows		$	7,639	$	8,418
Right-of-use operating assets obtained in exchange for new operating leases - non-cash activity		$	1,406	$	1,259

NOTE 15 — RESTRUCTURING

The Company generally incurs restructuring charges related to cost optimization of business activities, primarily related to severance and employee-related benefits. No restructuring charges were recognized during the three months ended March 2023 and March 2022.

All of the $4.5 million restructuring accrual reported in the Company's balance sheet at March 2023 is expected to be paid out within the next 12 months and was classified within "accrued liabilities." All of the $10.7 million restructuring accrual reported in the Company's balance sheet at December 2022 was classified within "accrued liabilities."

The following table presents activity in the restructuring accrual for the three-month period ended March 2023:

(In thousands)	Total
Accrual at December 2022	$	10,695
Cash payments	(6,227)
Adjustments to accruals	(79)
Currency translation	160
Balance, March 2023	$	4,549

NOTE 16 — SUBSEQUENT EVENT

On April 20, 2023, the Board of Directors declared a regular quarterly cash dividend of $0.48 per share of the Company's Common Stock. The cash dividend will be payable on June 20, 2023, to shareholders of record at the close of business on June 9, 2023.

19 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations is intended to provide readers of our financial statements with a narrative from management's perspective on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. This section should be read in conjunction with the Consolidated Financial Statements and related Notes included in this Quarterly Report on Form 10-Q.

The following discussion and analysis includes forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in “Cautionary Statement On Forward-Looking Statements” included later in Part I, Item 2 of this Quarterly Report on Form 10-Q and in Part I, Item 1A "Risk Factors" in our 2022 Annual Report on Form 10-K.

Description of Business

Kontoor Brands, Inc. ("Kontoor," the "Company," "we," "us" or "our") is a global lifestyle apparel company headquartered in the United States ("U.S."). The Company designs, produces, procures, markets, distributes and licenses apparel, footwear and accessories, primarily under the brand names Wrangler® and Lee®. The Company's products are sold in the U.S. through mass merchants, specialty stores, mid-tier and traditional department stores, company-operated stores and online. The Company's products are also sold internationally, primarily in the Europe, Middle East and Africa ("EMEA") and Asia-Pacific ("APAC") regions, through department, specialty, company-operated, concession retail and independently-operated partnership stores and online.

Fiscal Year and Basis of Presentation

The Company operates and reports using a 52/53-week fiscal year ending on the Saturday closest to December 31 of each year. Accordingly, this Form 10-Q presents the first quarter of the Company's fiscal year ending December 30, 2023 ("fiscal 2023"), which is a 52-week fiscal year. For presentation purposes herein, all references to periods ended March 2023, December 2022 and March 2022 correspond to the fiscal periods ended April 1, 2023, December 31, 2022 and April 2, 2022, respectively.

References to fiscal 2023 foreign currency amounts herein reflect the impact of changes in foreign exchange rates from the prior year comparable period and the corresponding impact on translating foreign currencies into U.S. dollars and on foreign currency-denominated transactions. The Company's most significant foreign currency translation exposure is typically driven by business conducted in euro-based countries, the Chinese yuan and the Mexican peso. However, the Company conducts business in other developed and emerging markets around the world with exposure to other foreign currencies.

Amounts herein may not recalculate due to the use of unrounded numbers.

Macroeconomic Environment and Other Recent Developments

Macroeconomic conditions, including inflation, rising interest rates, recessionary concerns, fluctuating foreign currency exchange rates and distress in global credit and banking markets, as well as ongoing global supply chain disruptions, labor challenges and the COVID-19 pandemic, continue to adversely impact global economic conditions, as well as the Company's operations. Additionally, the conflict between Russia and Ukraine continues to cause disruption in the surrounding areas and greater uncertainty in the global economy.

Inflationary pressures beginning in the second quarter of 2022 continued through the first quarter of 2023. Global interest rates began to increase during the second half of 2022, and the resulting distress in financial markets has continued through the first quarter of 2023. These factors contributed to reduced consumer discretionary spending, resulting in retailer actions to reduce their elevated inventory levels which continued to negatively impact our sales in the first quarter of 2023.

Many of the global supply chain disruptions seen in the first quarter of 2022 were less prevalent during the first quarter of 2023. Accordingly, we have been able to minimize the higher costs associated with air freight. However, we experienced increases in other input costs due to the inflationary pressures discussed above.

We experienced store closures, disruptions in distribution and restrictions on consumer mobility in certain regions of China during the latter part of the first quarter of 2022 due to COVID-19 and related restrictions, which had a significant impact on prior year sales and operations in APAC. Although China lifted its zero-tolerance lockdowns and restrictions during the fourth quarter of 2022, consumer behavior and the broader economy have not yet normalized, which had a negative impact on our sales in the first quarter of 2023.

While we anticipate continued disruption and volatility during 2023, we believe that we are appropriately positioned to successfully manage through known operational challenges. We continue to closely monitor macroeconomic conditions, including consumer behavior and the impact of these factors on consumer demand.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 20

Business Overview

We continue to execute on our Horizon 2 multi-year strategic vision, "Catalyzing Growth" which outlines four growth catalysts: (i) expansion of our core U.S. Wholesale business, (ii) category extensions such as outdoor, workwear and t-shirts, (iii) geographic expansion of our Wrangler® and Lee® brands, most notably in the APAC region, and (iv) channel expansion focused on the digital platforms in our U.S. Wholesale and Direct-to-Consumer channels. We are focused on driving brand growth and delivering long-term value to our stakeholders including our consumers, customers, shareholders, suppliers and communities around the world.

In addition to continued organic investments in our brands and capabilities, the options in our capital allocation strategy are to (i) pay down debt, (ii) provide for a superior dividend payout, (iii) effectively manage our share repurchase authorization and (iv) act on strategic investment opportunities that may arise.

FIRST QUARTER OF FISCAL 2023 SUMMARY

•Net revenues decreased 2% to $667.1 million compared to the three months ended March 2022, driven by a decline in the Non-U.S. Wholesale channel, partially offset by growth in the Direct-to-Consumer and U.S. Wholesale channels as discussed below.

•U.S. Wholesale revenues increased 1% compared to the three months ended March 2022, due to growth in our digital wholesale business. U.S. Wholesale revenues represented 71% of total revenues in the current period.

•Non-U.S. Wholesale revenues decreased 18% compared to the three months ended March 2022, driven by a decline in our APAC business due to the continued impacts of COVID-19 policy changes in China, a decline in our EMEA business due to a decrease in digital wholesale and a 4% unfavorable impact from foreign currency. Non-U.S. Wholesale revenues represented 18% of total revenues in the current period.

•Direct-to-Consumer revenues increased 12% on a global basis compared to the three months ended March 2022, driven by growth in our U.S. owned e-commerce sites and an increase in retail store sales, partially offset by a 3% unfavorable impact from foreign currency. Direct-to-Consumer revenues represented 11% of total revenues in the current period.

•Gross margin decreased 180 basis points to 43.0% compared to the three months ended March 2022, primarily driven by increased product and input costs due to inflationary pressures, unfavorable geographic and product mix, higher provisions for inventory losses and proactive actions in managing internal production, including downtime. These decreases were partially offset by benefits from strategic pricing and reduced use of air freight.

•Selling, general & administrative expenses as a percentage of net revenues decreased to 28.7% compared to 28.9% for the three months ended March 2022, primarily driven by lower compensation-related expense and reductions in discretionary expenses, partially offset by continued strategic investments in our direct-to-consumer business.

•Net income was $66.3 million compared to $80.8 million for the three months ended March 2022, due to the results discussed above.

21 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

ANALYSIS OF RESULTS OF OPERATIONS

Consolidated Statements of Operations

The following table presents components of the Company's statements of operations:

	Three Months Ended March
(Dollars in thousands)		2023			2022
Net revenues		$	667,123		$	679,743
Gross profit (net revenues less cost of goods sold)		$	286,701		$	304,621
As a percentage of total net revenues		43.0		%	44.8		%
Selling, general and administrative expenses		$	191,752		$	196,400
As a percentage of total net revenues		28.7		%	28.9		%
Operating income		$	94,949		$	108,221
As a percentage of total net revenues		14.2		%	15.9		%

Additionally, the following table presents a summary of the changes in net revenues for the three months ended March 2023 as compared to March 2022:

(In millions)	Three Months Ended March
Net revenues — 2022	$	679.7
Operations	(5.2)
Impact of foreign currency	(7.4)
Net revenues — 2023	$	667.1

Three Months Ended March 2023 Compared to the Three Months Ended March 2022

Net revenues decreased 2%, primarily driven by a decline in our APAC business due to the continued impacts of COVID-19 policy changes in China and a decline in our EMEA business due to a decrease in digital wholesale. These decreases were partially offset by growth in the U.S. which was driven by digital wholesale and our owned e-commerce sites.

Additional details on revenues are provided in the section titled “Information by Business Segment.”

Gross margin decreased 180 basis points primarily driven by increased product and input costs due to inflationary pressures, unfavorable geographic and product mix, higher provisions for inventory losses and proactive actions in managing internal production, including downtime. These decreases were partially offset by benefits from strategic pricing and reduced use of air freight.

Selling, general and administrative expenses as a percentage of net revenues decreased to 28.7% compared to 28.9%, primarily driven by lower compensation-related expense and reductions in discretionary expenses in response to macroeconomic conditions, partially offset by continued strategic investments in our direct-to-consumer business.

The effective income tax rate for the three months ended March 2023 was 20.0% compared to 19.5% in the 2022 period. The three months ended March 2023 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 0.2%. The three months ended March 2022 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 1.1%. The effective tax rate without discrete items for the three months ended March 2023 was 20.2% compared to 20.6% in the 2022 period. The decrease was primarily due to changes in our jurisdictional mix of earnings.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 22

Information by Business Segment

Management at each of the segments has direct control over and responsibility for corresponding net revenues and operating income, hereinafter termed "segment revenues" and "segment profit," respectively. The chief operating decision maker allocates resources and assesses performance based on the global brand operating results of Wrangler® and Lee®, which are the Company's segments. Common costs for certain centralized functions are allocated to the segments as disclosed in the notes to the financial statements in the Company's 2022 Annual Report on Form 10-K.

The following tables present a summary of the changes in segment revenues and segment profit for the three months ended March 2023 as compared to the three months ended March 2022:

Segment Revenues:

	Three Months Ended March
(In millions)	Wrangler		Lee		Total
Segment revenues — 2022	$	412.4	$	264.2	$	676.6
Operations	13.5		(19.0)		(5.4)
Impact of foreign currency	(2.8)		(4.6)		(7.4)
Segment revenues — 2023	$	423.1	$	240.6	$	663.8

Segment Profit:

	Three Months Ended March
(In millions)	Wrangler		Lee		Total
Segment profit — 2022	$	75.4	$	52.2	$	127.6
Operations	(4.2)		(11.5)		(15.7)
Impact of foreign currency	(0.1)		(1.1)		(1.2)
Segment profit — 2023	$	71.1	$	39.6	$	110.7

23 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

The following sections discuss the changes in segment revenues and segment profit.

Wrangler

	Three Months Ended March
(Dollars in millions)		2023			2022			Percent Change
Segment revenues		$	423.1		$	412.4		2.6	%
Segment profit		$	71.1		$	75.4		(5.7)	%
Operating margin		16.8		%	18.3		%

Three Months Ended March 2023 Compared to the Three Months Ended March 2022

Global revenues for the Wrangler® brand increased 3%, due to growth in the U.S. Wholesale and Direct-to-Consumer channels, partially offset by a decline in the Non-U.S. Wholesale channel.

•Revenues in the Americas region increased 4%, primarily due to growth in our digital wholesale business. The U.S. direct-to-consumer channel increased 16%, driven by growth in our owned e-commerce sites and an increase in retail store sales. Non-U.S. Americas wholesale revenues increased 22%, primarily due to higher sales in Canada, partially offset by a 4% unfavorable impact from foreign currency.

•Revenues in the APAC region increased 32%, despite a 5% unfavorable impact from foreign currency.

•Revenues in the EMEA region decreased 10%, due to a decline in the wholesale business primarily driven by digital wholesale and a 5% unfavorable impact from foreign currency, partially offset by growth in retail store sales.

Operating margin decreased to 16.8%, compared to 18.3% for the 2022 period, primarily driven by increased product and input costs due to inflationary pressures, unfavorable product mix, higher provisions for inventory losses, proactive actions in managing internal production, including downtime, and continued strategic investments in our direct-to-consumer business. These decreases were partially offset by benefits from strategic pricing and reduced use of air freight.

Lee

	Three Months Ended March
(Dollars in millions)		2023			2022			Percent Change
Segment revenues		$	240.6		$	264.2		(8.9)	%
Segment profit		$	39.6		$	52.2		(24.2)	%
Operating margin		16.4		%	19.8		%

Three Months Ended March 2023 Compared to the Three Months Ended March 2022

Global revenues for the Lee® brand decreased 9%, driven by declines in both the U.S. and Non-U.S. Wholesale channels and a 2% unfavorable impact from foreign currency, partially offset by growth in the Direct-to-Consumer channel.

•Revenues in the Americas region remained flat, with growth in the U.S. direct-to-consumer channel offset by a 1% decline in the U.S. wholesale channel. The U.S. direct-to-consumer channel increased 8%, driven by growth in our owned e-commerce sites, partially offset by declines in retail store sales.

•Revenues in the APAC region decreased 36%, driven by declines in wholesale revenues in China due to the continued impacts of COVID-19 policy changes and a 5% unfavorable impact from foreign currency.

•Revenues in the EMEA region decreased 3%, primarily driven by a 6% unfavorable impact from foreign currency and a decrease in the digital wholesale business, partially offset by growth in retail store sales.

Operating margin decreased to 16.4%, compared to 19.8% for the 2022 period, primarily driven by increased product and input costs due to inflationary pressures and unfavorable geographic mix. These decreases were partially offset by benefits from strategic pricing and reduced use of air freight.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 24

Other

In addition, we report an "Other" category to reconcile segment revenues and segment profit to the Company's operating results, but the Other category does not meet the criteria to be considered a reportable segment. Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

	Three Months Ended March
(Dollars in millions)		2023			2022			Percent Change
Revenues		$	3.3		$	3.1		7.3	%
Profit		$	0.1		$	0.4		(70.5)	%
Operating margin		3.2		%	11.7		%

Reconciliation of Segment Profit to Income Before Income Taxes

The costs below are necessary to reconcile total reportable segment profit to income before taxes. Corporate and other expenses and interest income and expense are not controlled by segment management and therefore are excluded from the measurement of segment profit.

	Three Months Ended March
(Dollars in millions)		2023		2022		Percent Change
Total reportable segment profit		$	110.7	$	127.6	(13.3)	%
Corporate and other expenses		(18.1)		(20.0)		(9.6)	%
Interest expense		(10.3)		(8.0)		28.0	%
Interest income		0.4		0.5		(10.7)	%
Profit related to other revenues		0.1		0.4		(70.5)	%
Income before income taxes		$	82.9	$	100.4	(17.5)	%

Three Months Ended March 2023 Compared to the Three Months Ended March 2022

Corporate and other expenses decreased $1.9 million, primarily due to lower compensation-related expense and reductions in discretionary expenses in response to macroeconomic conditions.

Interest expense increased $2.3 million, primarily due to higher borrowing rates for debt and higher average borrowings during the three months ended March 2023 compared to the three months ended March 2022.

25 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

ANALYSIS OF FINANCIAL CONDITION

Liquidity and Capital Resources

The Company's ability to fund our operating needs is dependent upon our ability to generate positive long-term cash flow from operations and maintain our debt financing on acceptable terms. The Company has historically generated strong positive cash flows from operations. However, elevated retailer inventories, reduced consumer discretionary spending and the continued negative impact on our sales drove higher Kontoor inventory levels, resulting in increased working capital and reduced cash flows from operations during the first quarter of 2023. The Company continues to take proactive measures to manage working capital. We believe cash flows from operations will be able to support our short-term liquidity needs as well as any future liquidity and capital requirements, in combination with available cash balances and borrowing capacity from our revolving credit facility.

The Company is party to a senior secured Credit Agreement, as amended and restated on November 18, 2021 (the "Credit Agreement"), which provides for (i) a five-year $400.0 million term loan A facility (“Term Loan A”), with quarterly mandatory repayments which commenced in March 2023 and (ii) a five-year $500.0 million revolving credit facility (the “Revolving Credit Facility”) (collectively, the “Credit Facilities”) with the lenders and agents party thereto. Additionally, the Company has outstanding $400.0 million of unsecured 4.125% senior notes due 2029. Refer to Note 10 in the Company's 2022 Annual Report on Form 10-K and Note 7 to the Company's financial statements in this Form 10-Q for additional information regarding the Company’s debt obligations.

As of March 2023, the Company was in compliance with all applicable financial covenants under the Credit Agreement and expects to maintain compliance with the applicable financial covenants for at least one year from the issuance of these financial statements. If economic conditions significantly deteriorate for a prolonged period, this could impact the Company’s operating results and cash flows and thus our ability to maintain compliance with the applicable financial covenants. As a result, the Company could be required to seek new amendments to the Credit Agreement or secure other sources of liquidity, such as refinancing of existing borrowings, the issuance of debt or equity securities, or sales of assets. However, there can be no assurance that the Company would be able to obtain such additional financing on commercially reasonable terms or at all.

The Revolving Credit Facility may be used to borrow funds in both U.S. dollar and certain non-U.S. dollar currencies, and has a maximum borrowing capacity of $500.0 million and a $75.0 million letter of credit sublimit. The Company had $50.0 million of outstanding borrowings under the Revolving Credit Facility as of March 2023 to provide additional funding for working capital needs.

The following table presents outstanding borrowings and available borrowing capacity under the Revolving Credit Facility and our cash and cash equivalents balances as of March 2023:

(In millions)	March 2023
Outstanding borrowings under the Revolving Credit Facility	$	50.0
Available borrowing capacity under the Revolving Credit Facility (1)	$	438.3
Cash and cash equivalents	$	52.7

(1) Available borrowing capacity under the Revolving Credit Facility is net of $11.7 million of outstanding standby letters of credit issued on behalf of the Company under this facility.

At March 2023, the Company had $24.9 million of international lines of credit with various banks, which are uncommitted and may be terminated at any time by either the Company or the banks. There was a total outstanding balance of $7.1 million under these arrangements at March 2023. In addition, short-term borrowings included other debt of $0.2 million at March 2023.

The Company did not repurchase any shares of Common Stock during the three months ended March 2023 under its share repurchase program authorized by the Company's Board of Directors. Of the $200.0 million authorized for repurchase under the share repurchase program, $62.0 million remained available for repurchase as of March 2023.

During the three months ended March 2023, the Company paid $26.8 million of dividends to its shareholders. On April 20, 2023, the Board of Directors declared a regular quarterly cash dividend of $0.48 per share of the Company's Common Stock. The cash dividend will be payable on June 20, 2023, to shareholders of record at the close of business on June 9, 2023.

The Company intends to continue to pay cash dividends in future periods. The declaration and amount of any future dividends will be dependent upon multiple factors including our financial condition, earnings, cash flows, capital requirements, covenants associated with our debt obligations, legal requirements, regulatory constraints, industry practice and any other factors or considerations that our Board of Directors deems relevant.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 26

We anticipate that we will have sufficient cash flows from operations, along with existing borrowing capacity, to support continued investments in our brands, infrastructure, talent and capabilities, dividend payments to shareholders, repayment of our current and long-term obligations when due and repurchases of Common Stock. In addition, we would use current liquidity as well as access to capital markets to fund any strategic investment opportunities that may arise.

We currently expect capital expenditures to range from $35.0 million to $40.0 million in 2023, primarily to support information technology, manufacturing, owned retail stores and distribution investments.

The following table presents our cash flows during the periods:

	Three Months Ended March
(In millions)		2023		2022
Cash (used) provided by:
Operating activities		$	(12.6)	$	74.8
Investing activities		$	(11.8)	$	(5.0)
Financing activities		$	17.0	$	(59.9)

Operating Activities

During the three months ended March 2023, cash used by operating activities was $12.6 million as compared to cash provided by operating activities of $74.8 million in the prior year period. The decrease was primarily due to lower net income and unfavorable changes in working capital accounts, primarily related to accounts payable, partially offset by lower outflows for accrued liabilities and inventories compared to the prior year period.

Investing Activities

During the three months ended March 2023, cash used by investing activities increased $6.8 million as compared to the prior year period, primarily due to increases in capitalized computer software and property, plant and equipment expenditures in the current year period.

Financing Activities

During the three months ended March 2023, cash provided by financing activities was $17.0 million as compared to cash used by financing activities of $59.9 million in the prior year period. The change was primarily due to $50.0 million of net borrowings under the Revolving Credit Facility during the three months ended March 2023 and $22.5 million of Common Stock repurchases made by the Company during the three months ended March 2022.

Contractual Obligations and Other Commercial Commitments

The section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations - Contractual Obligations" included in the Company's 2022 Annual Report on Form 10-K provided a summary of our contractual obligations and commercial commitments at the end of 2022 that would require the use of funds. As of March 2023, there have been no material changes in the amounts disclosed in the 2022 Annual Report on Form 10-K.

Critical Accounting Policies and Estimates

We have chosen accounting policies that management believes are appropriate to accurately and fairly report our operating results and financial position in conformity with GAAP. We apply these accounting policies in a consistent manner. Significant accounting policies are summarized in Note 1 to the consolidated financial statements included in the 2022 Annual Report on Form 10-K.

The application of these accounting policies requires that we make estimates and assumptions about future events and apply judgments that affect the reported amounts of assets, liabilities, net revenues, expenses, contingent assets and liabilities and related disclosures. These estimates, assumptions and judgments are based on historical experience, current trends and other factors believed to be reasonable under the circumstances. Management evaluates these estimates and assumptions on an ongoing basis. Because our business cycle is relatively short (i.e., from the date that inventory is received until that inventory is sold and the trade accounts receivable is collected), actual results related to most estimates are known within a few months after any balance sheet date. Several of the estimates and assumptions we are required to make relate to future events and are therefore inherently uncertain, especially as it relates to events outside of our control. If actual results ultimately differ from previous estimates, the revisions are included in results of operations when the actual amounts become known. Refer to Note 1 to the Company's financial statements in this Form 10-Q for considerations of macroeconomic conditions and other recent developments.

27 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

The accounting policies that involve the most significant estimates, assumptions and management judgments used in preparation of the financial statements, or are the most sensitive to change from outside factors, are discussed within "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates" in the 2022 Annual Report on Form 10-K. There have been no material changes in these policies disclosed in the 2022 Annual Report on Form 10-K.

Recently Issued and Adopted Accounting Standards

Refer to Note 1 to the Company's financial statements in this Form 10-Q for additional information regarding recently issued and adopted accounting standards.

Cautionary Statement on Forward-looking Statements

From time to time, the Company may make oral or written statements, including statements in this quarterly report, that constitute “forward-looking statements” within the meaning of the federal securities laws. These include statements concerning plans, objectives, projections and expectations relating to the Company’s operations or economic performance and assumptions related thereto. Forward-looking statements are made based on management’s expectations and beliefs concerning future events impacting the Company and therefore involve a number of risks and uncertainties. Forward-looking statements are not guarantees, and actual results could differ materially from those expressed or implied in the forward-looking statements. In addition, the forward-looking statements in this report are made as of the date of this filing, and the Company does not undertake, and expressly disclaims any duty, to update such statements, whether as a result of new information, new developments, or otherwise, except to the extent that disclosure may be required by law.

Potential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this report include, but are not limited to: macroeconomic conditions, including inflation, rising interest rates, recessionary concerns, fluctuating foreign currency exchange rates and distress in global credit and banking markets, as well as ongoing global supply chain disruptions, labor challenges, the COVID-19 pandemic and geopolitical events, continue to adversely impact global economic conditions and have had, and may continue to have, a negative impact on the Company’s business, results of operations, financial condition and cash flows (including future uncertain impacts); the level of consumer demand for apparel; supply chain and shipping disruptions, which could continue to result in shipping delays, an increase in transportation costs and increased product costs or lost sales; reliance on a small number of large customers; the COVID-19 pandemic continues to negatively affect the Company’s business and could continue to result in supply chain disruptions, reduced consumer traffic and purchasing, closed factories and stores, and reduced workforces (including future uncertain effects); intense industry competition; the ability to accurately forecast demand for products; the Company’s ability to gauge consumer preferences and product trends, and to respond to constantly changing markets; the Company’s ability to maintain the images of its brands; increasing pressure on margins; e-commerce operations through the Company’s direct-to-consumer business; the financial difficulty experienced by the retail industry; possible goodwill and other asset impairment; the ability to implement the Company’s business strategy; the stability of manufacturing facilities and foreign suppliers; fluctuations in wage rates and the price, availability and quality of raw materials and contracted products; the reliance on a limited number of suppliers for raw material sourcing and the ability to obtain raw materials on a timely basis or in sufficient quantity or quality; disruption to distribution systems; seasonality; unseasonal or severe weather conditions; the Company's and its vendors’ ability to maintain the strength and security of information technology systems; the risk that facilities and systems and those of third-party service providers may be vulnerable to and unable to anticipate or detect data security breaches and data or financial loss; ability to properly collect, use, manage and secure consumer and employee data; foreign currency fluctuations; disruption and volatility in the global capital and credit markets and its impact on the Company's ability to obtain short-term or long-term financing on favorable terms; the impact of climate change and related legislative and regulatory responses; legal, regulatory, political and economic risks; changes to trade policy, including tariff and import/export regulations; compliance with anti-bribery, anti-corruption and anti-money laundering laws by the Company and third-party suppliers and manufacturers; changes in tax laws and liabilities; the costs of compliance with or the violation of national, state and local laws and regulations for environmental, consumer protection, employment, privacy, safety and other matters; continuity of members of management; labor relations; the ability to protect trademarks and other intellectual property rights; the ability of the Company’s licensees to generate expected sales and maintain the value of the Company’s brands; the Company maintaining satisfactory credit ratings; restrictions on the Company’s business relating to its debt obligations; volatility in the price and trading volume of the Company’s common stock; anti-takeover provisions in the Company’s organizational documents; and fluctuations in the amount and frequency of our share repurchases. Many of the foregoing risks and uncertainties will be exacerbated by any continued worsening of the global business and economic environment.

More information on potential factors that could affect the Company's financial results are described in detail in the Company’s 2022 Annual Report on Form 10-K and in other reports and statements that the Company files with the Securities and Exchange Commission ("SEC").

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 28

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in the Company's market risk exposures set forth under Item 7A in our 2022 Annual Report on Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

(a) Disclosure Controls and Procedures. As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive and principal financial officers, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rule 13(a)-15(e) of the Securities Exchange Act of 1934 (the "Exchange Act")). Based on such evaluation, our principal executive and principal financial officers concluded that our disclosure controls and procedures were effective and operating to provide reasonable assurance that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and to provide reasonable assurance that such information is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure.

(b) Internal Control Over Financial Reporting. There have been no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) during the period to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

29 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is involved in various claims and lawsuits arising in the normal course of business, none of which, in the opinion of management, is expected to have a material adverse effect on our results of operations or financial condition.

ITEM 1A. RISK FACTORS

Careful consideration of the risk factors set forth under Part I, Item 1A, “Risk Factors,” of our 2022 Annual Report on Form 10-K should be made. There have been no material changes to the risk factors from those disclosed in Part I, Item 1A of our 2022 Annual Report on Form 10-K.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

First quarter fiscal 2023	Total number of shares purchased	Weighted average price paid per share		Total number of shares purchased as part of publicly announced program (1)	Dollar value of shares that may yet be purchased under the program
January 1 - January 28	—	$	—	—	$	62,044,756
January 29 - February 25	—	—		—	62,044,756
February 26 - April 1	—	—		—	62,044,756
Total	—	$	—	—

(1) The Company has a share repurchase program which authorizes the repurchase of up to $200.0 million of the Company's outstanding Common Stock through open market or privately negotiated transactions. The program does not have an expiration date but may be suspended, modified or terminated at any time without prior notice.

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 30

ITEM 6. EXHIBITS

3.2	Bylaws of Kontoor Brands, Inc., as amended through April 20, 2023 (incorporated by reference to Exhibit 3.2 to the Company's Form 8-K filed with the SEC on April 21, 2023)
10.42+	Kontoor Brands, Inc. 2019 Stock Compensation Plan Amendment No. 1
10.43+	Form of Award Certificate for Performance-Based Restricted Stock Units (2023 Form)
31.1	Certification of Scott H. Baxter, President, Chief Executive Officer and Chair of the Board, pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Rustin Welton, Executive Vice President and Chief Financial Officer, pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Scott H. Baxter, President, Chief Executive Officer and Chair of the Board, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Rustin Welton, Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
+	Management contract or compensatory plan or arrangement

Our SEC file number for documents filed with the SEC pursuant to the Securities Exchange Act of 1934, as amended, is 001-38854.

31 Kontoor Brands, Inc. Q1 FY23 Form 10-Q

SIGNATURES

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 thereunto duly authorized.

	KONTOOR BRANDS, INC.
	(Registrant)
Date: May 4, 2023	By:	/s/ Rustin Welton
		Rustin Welton
		Executive Vice President and Chief Financial Officer (Principal Financial Officer)
	By:	/s/ Denise Sumner
		Denise Sumner
		Vice President and Chief Accounting Officer (Principal Accounting Officer)

Kontoor Brands, Inc. Q1 FY23 Form 10-Q 32

EX-3.2

As Amended as of April 20, 2023 BYLAWS OF KONTOOR BRANDS, INC. (A North Carolina Corporation) ARTICLE I MEETINGS OF SHAREHOLDERS Section 1. Place of Meeting. Meetings of shareholders shall be held at such geographic location, within or without the State of North Carolina, as may be fixed from time to time by the Board of Directors or, in the case of a special meeting, the Secretary. If no such geographic location is so fixed by the Board of Directors or the Secretary, as applicable, meetings of the shareholders shall be held at the principal executive office of the Corporation wherever situated. Section 2. Annual Meeting. The annual meeting of the shareholders for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held, commencing with the year 2020, at such time and on such date as the Board of Directors shall determine. Section 3. Special Meetings. Special meetings of shareholders may be called at any time solely by the Chairman of the Board of Directors or the Board of Directors acting pursuant to a resolution adopted by a majority of the Board of Directors. Section 4. Adjournment. Adjournment or adjournments of any annual or special meeting may be taken, including one at which directors are to be elected, for such period as the shareholders present and entitled to vote shall direct. Section 5. Notice of Meetings. Written notice (conforming to the provisions of Section 1 of Article IV of these Bylaws) of every meeting of the shareholders shall be given by the Secretary, in the case of an annual meeting, and by or at the direction of the person or persons authorized to call the meeting, in the case of a special meeting, to each shareholder of record entitled to vote at the meeting, no fewer than 10 nor more than 60 days prior to the day named for the meeting, unless a greater period of notice is by law required in a particular case. When a meeting is adjourned, it shall not be necessary to give any notice of the adjourned meeting or of the business to be transacted at an adjourned meeting, other than by announcement at the meeting at which such adjournment is taken, unless the Board of Directors fixes a new record date for the adjourned meeting or the North Carolina Business Corporation Act requires notice of the business to be transacted and such notice has not previously been given. If the Corporation solicits proxies generally with respect to a meeting of its shareholders, it need not give notices of the meeting, or any material that accompanies the notice, to any shareholder not entitled to vote at the meeting. Section 6. Quorum of Shareholders. A meeting of shareholders duly called shall not be organized for the transaction of business unless a quorum is present. The presence, in person or by proxy, of the holders of a majority of the outstanding shares entitled to cast a vote on the particular matter to be acted upon shall constitute a quorum for the purposes of consideration and action on the matter. The shareholders present at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum. To the extent a quorum is present with respect to consideration and action on a particular matter or matters but a quorum is not present as to another matter or other matters, consideration and action on the matter or matters for which a quorum is present may occur and, after such consideration and action, the meeting may be adjourned for purposes of the consideration of and action on the matter or matters for which a quorum is not present. If a meeting cannot be organized because a quorum has not attended, those present may adjourn the meeting to such time and place as they may determine; provided, however, that (i) in the case of any meeting called for the election of directors, those who attend the second of such adjourned meetings, although less than a quorum as fixed in this Section, shall nevertheless constitute a quorum for the purpose of electing directors and (ii) in the case of a meeting that has been previously adjourned for one or more periods aggregating at least 15 days because of an absence of a quorum, although less than a quorum as fixed in the North Carolina Business Corporation Act or in these Bylaws, shall nevertheless constitute a quorum for the purpose of acting upon any matter set forth in the notice of the Exhibit 3.2

2 meeting if the notice states that those shareholders who attend the adjourned meeting shall nevertheless constitute a quorum for the purpose of acting upon the matter. Section 7. Shareholders’ List. After a record date is fixed for a meeting, the Secretary of the Corporation shall prepare an alphabetical list of the names of all the Corporation’s shareholders who are entitled to notice of the shareholders’ meeting. Such list shall be arranged by voting group (and within each voting group by class or series of shares) and shall show the address of and number of shares held by each shareholder. The shareholders’ list shall be made available for inspection by any shareholder beginning two business days after notice of the meeting is given for which the list was prepared and continuing through the meeting, at the Corporation’s principal office or at such other place identified in the meeting notice in the city where the meeting will be held. The Corporation shall make the shareholders’ list available at the meeting, and any shareholder or his agent or attorney is entitled to inspect the list at any time during the meeting or any adjournment. Section 8. Organization. At every meeting of the shareholders, the Chairman of the Board of Directors, or in his or her absence, the director designated by the vote of the majority of the directors present at such meeting, shall act as chairman of the meeting and the Secretary, or in his or her absence, a person appointed by the Chairman, shall act as secretary of the meeting. Section 9. Voting. (a) Voting Rights. Except as otherwise provided in the Articles, or by law, every shareholder of record shall have the right, on each matter submitted to a vote at a meeting of the shareholders, to one vote for every share standing in his or her name on the books of the Corporation. Holders of fractional shares shall not be entitled to any vote in respect thereof. Every shareholder may vote either in person or by proxy. (b) Proxies. At all meetings of shareholders, shareholders entitled to vote may attend and vote either in person or by proxy. Every proxy appointment form shall be executed or authenticated by the shareholder, or by the shareholder’s duly authorized attorney-in-fact, and shall be filed with, or transmitted to, the Secretary of the Corporation or its designated agent in writing or by electronic transmission. An appointment of a proxy, unless coupled with an interest (as defined in Section 55-7-22 of the North Carolina Business Corporation Act), shall be revocable at will, notwithstanding any other agreement or any provision in the proxy appointment form to the contrary, but the revocation of a proxy shall not be effective until notice thereof has been given to the Secretary of the Corporation or its designated agent in writing or by electronic transmission. No unrevoked appointment of proxy shall be valid after 11 months from the date of its execution, authentication or transmission, unless a longer time is expressly provided therein. A proxy shall not be revoked by the death or incapacity of the maker unless, before the vote is counted or the authority is exercised, written notice of such death or incapacity is given to the Secretary of the Corporation or its designated agent. A shareholder shall not sell his or her vote or execute a proxy to any person for any sum of money or anything of value. (c) Ballot. No vote by the shareholders need be by ballot, except, in elections of directors, upon demand made by a shareholder entitled to vote at the election before the voting begins. (d) Required Vote. Except as otherwise specified in the Articles of Incorporation of the Corporation, these Bylaws or provided by law, all matters shall be decided by the vote of the holders of a majority of the shares cast at a meeting at which a quorum shall be present, though such majority be less than a majority of all the outstanding shares entitled to vote thereon. The shareholders present at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum. (e) Shares Owned by the Corporation. Shares of its own capital stock belonging to the Corporation (other than shares of its own capital stock, if any, held by it in a fiduciary capacity) shall not be voted, directly or indirectly, at any meeting, and shall not be counted in determining the total number of outstanding shares for voting purposes at any given time. (f) Shares Owned by Other Corporations. Except as otherwise required by law, shares in this Corporation owned by another corporation may be voted by any officer or agent of the latter or by proxy appointed by any such officer or agent, unless some other person, by resolution of its Board of Directors or a provision of its charter or Bylaws, a copy of which resolution or provision certified to be correct by one of its officers has been filed with the Secretary

3 of this Corporation, shall be appointed its general or special proxy, in which case such person shall be entitled to vote such shares. (g) Shares Jointly Held or Held by Fiduciaries. Shares in this Corporation held by two or more persons jointly or as tenants in common, as fiduciaries or otherwise (including a partnership), may be voted by any one or more of such persons, either in person or by proxy. If the persons are equally divided upon whether the shares held by them shall be voted or upon the manner of voting the shares, the voting of the shares shall be divided equally among the persons without prejudice to the rights of the joint owners or the beneficial owners thereof among themselves. If there has been filed with the Secretary of the Corporation a copy, certified by an attorney at law to be correct, of the relevant portions of the agreement under which the shares are held or the instrument by which the trust or estate was created or the order of court appointing them or of an order of court directing the voting of the shares, the persons specified as having such voting power in the latest document so filed, and only those persons, shall be entitled to vote the shares but only in accordance therewith. (h) Telephonic Meetings. Unless otherwise restricted by the Articles of Incorporation of the Corporation or these Bylaws, shareholders may participate in any meeting of shareholders by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence at the meeting. Section 10. Determination of Shareholders of Record. The Board of Directors may fix a time prior to the date of any meeting of shareholders, or prior to any other date, including, but not limited to, the date fixed for the payment of any dividend or distribution, as a record date for the determination of the shareholders entitled to notice of, and to vote at, any such meeting or entitled to receive payment of any such dividend or distribution or as a record date for any other purpose, provided that the record date shall be not more than 70 days prior to the date of the meeting or action requiring a determination of shareholders. A determination of shareholders entitled to notice of or to vote at a meeting of shareholders is effective for any adjournment of the meeting unless the Board of Directors fixes a new record date, which it must do if the meeting is adjourned to a date more than 120 days after the date fixed for the original meeting. Only such shareholders as shall be shareholders of record on the date so fixed shall be entitled to notice of, and to vote at, such meeting, or to receive payment of such dividend or distribution, or to such other rights as are involved, notwithstanding any transfer of any shares on the books of the Corporation after any record date fixed as aforesaid. Unless a record date is fixed by the Board of Directors: (1) the record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the tenth day next preceding the day on which notice is given or, if notice is waived, at the close of business on the day immediately preceding the day on which the meeting is held, (2) the record date for determining shareholders entitled to express consent or dissent to corporate action in writing without a meeting, when prior action by the Board of Directors is not necessary, shall be the close of business on the day on which the first written consent or dissent is filed with the Secretary of the Corporation, and (3) the record date for determining shareholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. Section 11. Procedure for Notice of Shareholder Nominations and Proposals. Nominations of persons for election to the Board of Directors or the proposal of other business to be transacted by the shareholders at an annual meeting of shareholders may be made only (1) pursuant to the Corporation’s notice of meeting (or any supplement thereto), (2) by or at the direction of the Board of Directors or any committee thereof or (3) as may be provided in the certificate of designations for any class or series of preferred stock or (4) by any shareholder of the Corporation who is a shareholder of record at the time of giving of notice provided for in Section 10 of this Article I and at the time of the annual meeting, who shall be entitled to vote at the meeting and who complies with the procedures set forth in this Section 11, and, except as otherwise required by law, any failure to comply with these procedures shall result in the nullification of such nomination or proposal. For nominations or other business to be properly brought before an annual meeting of shareholders by a shareholder pursuant to clause (4) of the preceding paragraph, the shareholder must have given timely notice thereof in writing to the Secretary of the Corporation, and any such proposed business (other than the nominations of persons for election to the Board of Directors) must constitute a proper matter for shareholder action. To be timely, a shareholder’s notice shall be delivered to, or mailed and received by, the Secretary of the Corporation at the principal executive offices of the Corporation not less than 90 days nor more than 120 days prior to the first

4 anniversary of the preceding year’s annual meeting of shareholders (or, in the case of the first annual meeting, not less than 90 days nor more than 120 days prior to such meeting); provided, however, that in the event that the date of the annual meeting is advanced more than 30 days prior to such anniversary date or delayed more than 70 days after such anniversary date, then to be timely, such notice must be received by the Corporation no earlier than 120 days prior to such annual meeting and no later than the later of 70 days prior to the date of the meeting or the 10th day following the day on which public announcement of the date of the meeting was first made by the Corporation. In no event shall the adjournment or postponement of any meeting, or any announcement thereof, commence a new time period (or extend any time period) for the giving of a shareholder’s notice as described above. A shareholder’s notice to the Secretary shall set forth (1) as to each person whom the shareholder proposes to nominate for election or reelection as a director: (i) all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934 (as amended (together with the rules and regulations promulgated thereunder, the “Exchange Act”)), including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected; and (ii) a reasonably detailed description of any compensatory payment or other financial agreement, arrangement or understanding that such person has with any other person or entity other than the Corporation, including the amount of any payment or payments received or receivable thereunder, in each case in connection with candidacy or service as a director of the Corporation; (2) as to any other business that the shareholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend these Bylaws, the text of the proposed amendment), the reasons for conducting such business and any material interest in such business of such shareholder and the beneficial owner, if any, on whose behalf the proposal is made; and (3) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the proposal is made: (i) the name and address of such shareholder (as they appear on the Corporation’s books) and any such beneficial owner; (ii) for each class or series, the number of shares of capital stock of the Corporation that are held of record or are beneficially owned by such shareholder and by any such beneficial owner; (iii) a description of any agreement, arrangement or understanding between or among such shareholder and any such beneficial owner, any of their respective affiliates or associates, and any other person or persons (including their names) in connection with the proposal of such nomination or other business; (iv) a description of any agreement, arrangement or understanding (including, regardless of the form of settlement, any derivative, long or short positions, profit interests, forwards, futures, swaps, options, warrants, convertible securities, stock appreciation or similar rights, hedging transactions and borrowed or loaned shares) that has been entered into by or on behalf of, or any other agreement, arrangement or understanding that has been made, the effect or intent of which is to create or mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, such shareholder or any such beneficial owner or any such nominee with respect to the Corporation’s securities; (v) a representation that the shareholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to bring such nomination or other business before the meeting; (vi) a representation as to whether such shareholder or any such beneficial owner intends or is part of a group that intends to (a) deliver a proxy statement and/or form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding capital stock required to approve or adopt the proposal or to elect each such nominee and/or (b) otherwise to solicit proxies from shareholders in support of such proposal or nomination; (vii) any other information relating to such shareholder, beneficial owner, if any, or director nominee or proposed business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with the solicitation of proxies in support of such nominee or proposal pursuant to Section 14 of the Exchange Act; and (viii) such other information relating to any proposed item of business as the Corporation may reasonably require to determine whether such proposed item of business is a proper matter for shareholder action.

5 Section 1. Powers and Election. ARTICLE II BOARD OF DIRECTORS (a) Powers. The business and affairs of the Corporation shall be managed by the Board of Directors, and all powers of the Corporation, except as otherwise provided by law, by the Articles of Incorporation of the Corporation, or by these Bylaws, shall be exercised by the Board of Directors. (b) Election. Directors shall be elected by the shareholders in accordance with Article SEVENTH of the Articles of Incorporation of the Corporation. Section 2. Qualifications. Directors shall be natural persons but need not be residents of the State of North Carolina or shareholders in the Corporation. A director may also be a salaried officer or employee of the Corporation. If any person elected as a director shall, within 30 days after notice of his or her election fail to accept such office, either in writing or by attending a meeting of the Board of Directors, the Board of Directors may declare his or her office vacant. The Board of Directors or a committee of the Board of Directors appointed pursuant to Article III of these Bylaws shall not nominate for election or reelection as a director any candidate who has not agreed to tender, promptly following the meeting at which he or she is elected or reelected as a director, an irrevocable resignation that will be effective upon (a) the failure of such director to receive the number of votes required for reelection at the next annual meeting of shareholders at which he or she stands for reelection, and (b) the acceptance of such director’s resignation by the Board of Directors. Section 3. Number and Term of Office. The number of directors of the Corporation, and the classes thereof, shall be determined in accordance with Article SEVENTH of the Articles of Incorporation of the Corporation. Section 4. Resignations. Any director of the Corporation may resign at any time by giving written notice to the Board of Directors, to the Chairman, to the President, or to the Secretary of the Corporation. Such resignation shall take effect when it is communicated unless it specifies in writing a later effective date or subsequent event upon which it will become effective. In the event that a director fails to receive the number of votes required for reelection to the Board of Directors, the Nominating and Governance Committee of the Board of Directors will make a recommendation to the Board of Directors as to whether the Board of Directors should accept the director’s resignation tendered pursuant to Section 2 of this Article II, reject such resignation or take such other action as the Committee may recommend. The Board of Directors will act on the Committee’s recommendation and publicly disclose its decision and the rationale behind such decision within ninety (90) days after certification of the election results. Section 5. Removal. Directors may be removed solely in accordance with Section (D) of Article SEVENTH of the Articles of Incorporation of the Corporation. Section 6. Vacancies. Vacancies in the Board of Directors, whether occurring because of death, resignation, removal, increase in the number of directors, or because of some other reason, may be filled solely in accordance with Section (E) of Article SEVENTH of the Articles of Incorporation of the Corporation and this Section. The Board of Directors shall not fill a vacancy on the Board of Directors or a newly created directorship with any candidate who has not agreed to tender, promptly following his or her appointment to the Board of Directors, an irrevocable resignation that will be effective upon the occurrence of the events set forth in both of the following clauses (a) and (b): (a) the failure of such director to receive the number of votes required for reelection at the next annual meeting of shareholders at which he or she stands for reelection, and (b) the acceptance of such director’s resignation by the Board of Directors. Section 7. Place of Meeting. The meetings of the Board of Directors may be held at such place, within the State of North Carolina or elsewhere, as a majority of the directors may from time to time determine, or as may be designated in the notice calling the meeting.

6 Section 8. Regular Meetings. Regular meetings of the Board of Directors shall be held on such dates and at such times as shall be designated from time to time by resolution of the Board of Directors and at such geographic location as may be designated in the notice calling the meeting. At such meetings the directors shall transact such business as may properly be brought before the meeting. Section 9. Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board of Directors, by the President, or by a majority of the directors, and shall be held at such time and place as shall be designated in the notice for the meeting. Section 10. Notice of Meetings; Adjournment. Notice, in accordance with the provisions of Article IV, Section 1 of these Bylaws, of each special meeting shall be given, by or at the direction of the person authorized to call such meeting, to each director, at least six hours prior to the commencement of the meeting. Notice of regular meetings need not be given. When a meeting is adjourned, it shall not be necessary to give any notice of the adjourned meeting, or of the business to be transacted at an adjourned meeting, other than by an announcement at the meeting at which such adjournment is taken. Section 11. Quorum. A majority of the directors in office shall be necessary to constitute a quorum for the transaction of business, and the acts of a majority of the directors present at a meeting at which a quorum is present shall be the acts of the Board of Directors. Section 12. Organization. At every meeting of the Board of Directors, the Chairman of the Board of Directors, or in his or her absence, the director designated by the vote of the majority of the directors present at such meeting, shall preside, and the Secretary, or, in his or her absence, any person appointed by the Chairman or such other designated director, shall act as secretary. Section 13. Action By Consent of Directors Without a Meeting. Any action required or permitted to be taken at a meeting of the Board of Directors or any Board committee may be taken without a meeting if, prior or subsequent to the action, a consent in writing setting forth the action so taken shall be signed by all of the directors or the members of the committee, as the case may be, and shall be filed with the Secretary of the Corporation. A consent may be given by any means permitted by the North Carolina Business Corporation Act. Section 14. Participation in Board Meetings By Conference Telephone or Other Electronic Technology. One or more directors may participate in a meeting of the Board of Directors or of any Board committee by means of conference telephone or other electronic technology by means of which all persons participating in the meeting can hear each other, and all directors so participating shall be deemed present in person at the meeting. Section 15. Compensation of Directors. Each director who is not a salaried officer or employee of the Corporation or its subsidiaries shall be compensated for his or her services as a member of the Board of Directors or any committee thereof in such manner as the Board of Directors by resolution shall from time to time provide. Directors shall also be reimbursed by the Corporation for all reasonable expenses incurred in traveling to and from the place of each meeting of the Board of Directors or any such committee. ARTICLE III Committees Section 1. Executive Committee. The Board of Directors may, by resolution adopted by a majority of the whole Board, delegate the Chairman of the Board, and one or more additional directors to constitute an Executive Committee which, to the extent provided in such resolution, shall have and exercise the authority of the Board of Directors in the management of the business of the Corporation, except that such Executive Committee shall not have any power or authority as to the following: (i) the authorization or approval of distributions, except according to a formula or method, or within limits, prescribed by the Board of Directors; (ii) the approval of, or the proposal to shareholders of, any action requiring approval of shareholders under the North Carolina Business Corporation Act; (iii) the filling of vacancies in the Board of Directors or any of its committees; (iv) the amendment of the Articles of Incorporation of the Corporation; (v) the adoption, amendment or repeal of the Bylaws; (vi) the amendment or repeal of any resolution of the Board of Directors that by its terms is amendable or repealable only by the Board of

7 Directors; (vii) the approval of a plan of merger not requiring shareholder approval; and (viii) action on matters committed by the Bylaws or resolution of the Board of Directors to another committee of the Board of Directors. The Executive Committee shall keep regular minutes of its proceedings and report the same to the Board of Directors at each regular meeting. Section 2. Other Committees. The Board of Directors may, at any time and from time to time, appoint one or more other committees, consisting of one or more directors, to perform such duties and make such investigations and reports as the Board of Directors shall by resolution determine, except that any such committee shall be subject to the same restrictions on power and authority as the Executive Committee set forth in Section 1 of this Article III. Such committees shall determine their own organization and times and places of meeting, unless otherwise directed by such resolution. Section 3. Term. Each committee of the Board of Directors and the members thereof shall serve at the pleasure of the Board of Directors. ARTICLE IV Notice - Waiver Section 1. Notice – What Constitutes. Whenever, under the provisions of the North Carolina Business Corporation Act or of the Articles of Incorporation of the Corporation or of these Bylaws or otherwise, written notice is required to be given to any person, it may be given to such person, either personally or by sending a copy thereof by either of the following methods: (i) by first class or express mail or courier service, charges prepaid to his or her postal address appearing on the books of the Corporation, or supplied by him or her to the Corporation for the purpose of notice. Notice pursuant to this clause (i) shall be deemed to have been given to the person entitled thereto when deposited in the United States mail or with the courier service for delivery to that person; or (ii) by facsimile transmission, e-mail or other electronic communication to his or her facsimile number or address for e-mail or other electronic communications supplied by him or her to the Corporation for the purpose of notice. Notice pursuant to this clause (ii) shall be deemed given to the person entitled thereto when sent. Such notice shall specify the place, day, and hour of the meeting, and, in the case of a special meeting of shareholders, the general nature of the business to be transacted. Section 2. Waiver in Writing. Whenever, under the provisions of the North Carolina Business Corporation Act or of the Articles of Incorporation of the Corporation or of these Bylaws or otherwise, any written notice is required to be given, a waiver thereof in writing, signed by the person or persons entitled to such notice and delivered to the Corporation for inclusion in the minutes or filing with the corporate records, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Except in the case of a special meeting of shareholders, neither the business to be transacted at nor the purpose of the meeting need be specified in the waiver of notice of such meeting. Section 3. Waiver by Attendance. The presence of a person, either in person or by proxy, at any meeting shall constitute a waiver of notice of such meeting, except where a person attends a meeting for the express purposes of objecting, at the beginning of the meeting, to the transaction of any business because the meeting was not lawfully called or convened. Section 4. Notice Not Required. The giving of notice required under these Bylaws is not required to be given to any shareholder with whom the Corporation has been unable to communicate for more than 24 consecutive months, if such communications to the shareholder are returned unclaimed or the shareholder has otherwise failed to provide the Corporation with a current address. Whenever the shareholder provides the Corporation with a current address, notice shall be given to that shareholder as required under these Bylaws. Section 5. Bulk Mail. Notice of any regular or special meeting of the shareholders or any other notice required by the North Carolina Business Corporation Act, the Articles, or these Bylaws to be given to all shareholders or to all

8 holders of a class or a series of shares, may be given by any class of post-paid mail if the notice is deposited in the United States mail at least 20 days prior to the day named for the meeting or any corporate or shareholder action specified in the notice. ARTICLE V Officers and Agents Section 1. Officers. The officers of the Corporation may include a Chairman of the Board of Directors, a President, a Secretary, a Treasurer, and may include one or more Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, a Controller, and such other officers and assistant officers as the Board of Directors may from time to time determine. Section 2. Qualifications. Any two or more offices may be held by the same person, provided that no person may act in more than one capacity where action of two or more officers is required. It shall not be necessary for the officers to be directors. The Board of Directors may secure the fidelity of any or all of the officers by bond or otherwise, as provided for by this Article V. Section 3. Election and Term of Office. The officers of the Corporation shall be elected or appointed by the Board of Directors at its annual meeting, but the Board of Directors may elect or appoint officers or fill any vacancies among the officers at any other meeting. Subject to earlier termination of office as herein provided, each officer shall hold office for one year and until his or her successor shall have been duly elected or appointed and qualified. Section 4. Resignations. Any officer may resign at any time by giving written notice to the Board of Directors, or to the Chairman, or to the President, or to the Secretary, of the Corporation. Any such resignation shall take effect when it is communicated unless it specifies in writing a later effective time. Section 5. Removal of Officers. Any officer or agent of the Corporation may be removed with or without cause by the Board of Directors, the appointing officer or any other officer if authorized by these Bylaws or the Board of Directors, but such removal shall be without prejudice to the contract rights, if any, of the persons so removed. Election or appointment of an officer or agent shall not of itself create contract rights. Section 6. Vacancies. The Board of Directors shall have the power to fill any vacancies in any office occurring for whatever reason. Section 7. The Chairman of the Board of Directors. Unless otherwise determined by the Board of Directors, the Chairman of the Board of Directors shall be the chief executive officer of the Corporation and shall have general supervision over the business and operations of the Corporation, subject, however, to the control of the Board of Directors. The Chairman of the Board of Directors shall serve as Chairman of the Executive Committee, subject, however, to the control of the Board of Directors. He or she shall, if present, preside as Chairman at all meetings of the shareholders and of the directors. He or she shall be, ex officio, a member of all standing committees of the Board of Directors except the Audit, Compensation and Corporate Governance and Nominating Committees. The Chairman shall be authorized to sign, execute, and acknowledge, in the name of the Corporation, deeds, mortgages, bonds, contracts, and other instruments authorized by the Board of Directors, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the Corporation. He or she shall have such other powers and perform such further duties as may be assigned to him or her by the Board of Directors. Section 8. The President. Unless the Board of Directors has determined that the President shall serve as the chief executive officer of the Corporation with general supervision over the business and operations of the Corporation (subject, however, to the control of the Board of Directors), the President shall be the chief operating officer of the Corporation and shall be authorized to sign, execute, and acknowledge, in the name of the Corporation, deeds, mortgages, bonds, contracts, and other instruments authorized by the Board of Directors, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the Corporation; and in general, he or she shall perform duties incident to the office of President, and such other duties as from time to time may be assigned to him or her by the Board of Directors or by the Chairman. If the President is serving as a director, then during the absence or disability of the Chairman of the Board, he or she shall preside at all meetings of the shareholders or the Board of Directors.

9 Section 9. The Vice Presidents. Each Vice President shall have such powers and shall perform such duties as may be assigned to him or her by the senior officers of the Corporation or by the Board of Directors. The Board of Directors may designate one or more Vice Presidents as Executive Vice Presidents or Senior Vice Presidents, or make such other designations of Vice Presidents as it may deem appropriate. Section 10. The Secretary. The Secretary shall record all the votes of the shareholders and of the directors and the minutes of the meetings of the shareholders and of the Board of Directors in a book or books to be kept for that purpose; he or she shall see that notices of meetings of the Board of Directors and shareholders are given and that all records and reports are properly kept and filed by the Corporation as required by law; in general, he or she shall perform all duties incident to the office of Secretary, and such other duties as may from time to time be assigned to him or her by the Board of Directors, the Chairman or the President. Section 11. Assistant Secretaries. In the absence or disability of the Secretary, any Assistant Secretary may perform all the duties of the Secretary, and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Secretary. The Assistant Secretaries shall perform such other duties as from time to time may be assigned to them respectively by the Board of Directors, the Chairman, the President or the Secretary. Section 12. The Treasurer. The Treasurer shall perform all duties commonly incident to that office (including, but without limitation, the care and custody of the funds and securities of the Corporation which from time to time may come into his or her hands and the deposit of the funds of the Corporation in such banks or trust companies as the Board of Directors may authorize or direct) and, in addition, such other duties as the Board of Directors from time to time may prescribe. Section 13. Assistant Treasurers. In the absence or disability of the Treasurer, any Assistant Treasurer may perform all the duties of the Treasurer, and, when so acting, shall have all the powers of and be subject to all the restrictions upon the Treasurer. The Assistant Treasurers shall perform such other duties as from time to time may be assigned to them respectively by the Board of Directors, the Chairman, the President or the Treasurer. Section 14. Compensation of Officers and Others. The compensation of all officers shall be fixed from time to time by the Board of Directors or a Committee thereof or by the Chairman. No officer shall be precluded from receiving such compensation by reason of the fact that he or she is also a director of the Corporation. Additional compensation, fixed as above provided, may be paid to any officers and/or employees for any year, based on the success of the operations of the Corporation during such year. Section 15. Agents and Employees. The Chairman, the President or any officer or employee of the Corporation authorized by the Chairman or the President may appoint or employ such agents and employees as shall be requisite for the proper conduct of the business of the Corporation, and may fix their compensation and the terms of their employment. ARTICLE VI Borrowing, Deposits, Proxies, Etc. Section 1. Borrowing, etc. No officer or officers, agent or agents, employee or employees of the Corporation shall have any power or authority to borrow money on its behalf, to pledge its credit, or to mortgage or pledge its real or personal property, except within the scope and to the extent of the authority delegated by resolution of the Board of Directors. Authority may be given by the Board of Directors for any of the above purposes and may be general or limited to specific instances. Section 2. Deposits. All funds of the Corporation shall be deposited from time to time to the credit of the Corporation in such banks, trust companies, or other depositaries, as the Board of Directors may approve or designate, and all such funds shall be withdrawn only upon the authority of such one or more officers or employees as the Board of Directors shall from time to time determine. Section 3. Voting of Shares and Proxies. Subject always to the specific directions of the Board of Directors, any share or shares of stock issued by any other corporation and owned or controlled by the Corporation may be voted by any officer of the Corporation at any shareholders’ meeting of such other corporation or by execution of a written

10 consent to action. Unless otherwise ordered by the Board of Directors, any officer of the Corporation may appoint an attorney or attorneys (who may be or include such officer himself), in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as a shareholder or otherwise in any other corporation any of whose shares or other securities are held by or for the Corporation, at meetings of the holders of the shares or other securities of such other corporation, or, in connection with the ownership of such shares or other securities, to consent in writing to any action by such other corporation, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its seal such written proxies or other instruments as he or she may deem necessary or proper in the circumstances. Section 4. Execution of Instruments. Except as otherwise authorized by the Board of Directors, any note, mortgage, evidence of indebtedness, contract, or other instrument of writing, or any assignment or endorsement thereof, executed or entered into between the Corporation and any other person, co-partnership, association or corporation, when signed by any one of the Chairman, the President, a Vice President, the Treasurer and the Secretary shall be held to have been properly executed for and on behalf of the Corporation. ARTICLE VII Corporate Records - Inspection Section 1. Records to be Kept. The Corporation shall keep an original or duplicate record of the proceedings of the shareholders and of the directors, and a copy of these Bylaws, including all amendments or alterations thereto, to date, certified by the Secretary of the Corporation. It shall also keep at its registered office, its principal place of business wherever located, any actual place of business of the Corporation, or at the office of the Transfer Agent or Registrar of the Corporation, a share register giving the names of the shareholders, in alphabetical order, and showing their respective addresses, the number and classes of shares held by each. It shall also keep appropriate, complete, and accurate books and records of account, which may be kept at its registered office or at its principal place of business. Any books, minutes or other records may be in written form or any other form capable of being converted into written form within a reasonable time. Section 2. Inspection. Every shareholder shall, upon written verified demand stating the purpose thereof, have a right to examine, in person or by agent or attorney, at any reasonable time or times, for any proper purpose, the share register, books and records of account, and records of the proceedings of the shareholders and directors, and to make copies or make extracts therefrom. ARTICLE VIII Share Certificates, Transfer Section 1. Share Certificates. Unless otherwise determined by the Board of Directors, the shares of the Corporation shall be represented by share certificates. Share certificates shall contain the matters required by law, and shall be signed by any two or more of the Chairman of the Board, the President, a Vice President, the Treasurer and the Secretary. Where such certificate is signed by a Transfer Agent or a Registrar, the signature of any corporate officer upon such certificate, and the corporate seal if one is affixed, may be a facsimile, engraved or printed. In case any officer who has signed, or whose facsimile signature has been placed upon, any share certificate shall have ceased to be such officer because of death, resignation, or otherwise, before the certificate is issued, it may be issued by the Corporation with the same effect as if the officer had not ceased to be such at the date of its issue. Every shareholder of record shall be entitled to a share certificate representing the shares owned by him or her, but a share certificate shall not be issued by the Corporation to any shareholder until the shares represented thereby have been fully paid. The Board of Directors may determine that any or all classes and series of shares, or any part thereof, shall be uncertificated shares, in which case the Corporation shall send to the registered owner thereof a written notice containing such information as is required by law. Section 2. Transfer of Shares. Transfers of share certificates and the shares represented thereby shall be made only on the books of the Corporation by the owner thereof, or by his or her attorney thereunto authorized, by a power of attorney duly executed and filed with the Secretary or a Transfer Agent of the Corporation, and on surrender of the

11 share certificate or certificates. In the case of uncertificated shares, the transfer of shares shall be made upon receipt of such documentation as the Corporation may require. Section 3. Transfer Agent and Registrar; Regulations. The Corporation may, if and whenever the Board of Directors may so determine, maintain in the State of North Carolina or any other state, or in both, one or more transfer offices or agencies, each in charge of a Transfer Agent or Agents designated by the Board of Directors, where the shares of the Corporation shall be directly transferable, and also one or more registry offices, each in charge of a Registrar or Registrars designated by the Board of Directors, where such shares shall be so registered, and no certificates for shares of the Corporation in respect of which a Transfer Agent and Registrar shall have been designated shall be valid unless countersigned by such Transfer Agent and registered by such Registrar. The Board of Directors may also make such additional rules and regulations as it may deem expedient concerning the issue, transfer, and registration of share certificates of the Corporation. Section 4. Lost, Destroyed, and Mutilated Certificates. The holder of any share certificate of the Corporation shall immediately notify the Corporation of any loss, destruction, or mutilation thereof, and the Board of Directors may, in its discretion, by either special or standing resolution, provide for and cause the issuance to him or her of a new share certificate or certificates, in the case of mutilation upon surrender of the mutilated certificate, or, in case of loss or destruction of the certificate, upon such proof of loss or destruction and such reasonable notice by publication and/or the deposit of a bond in such form and in such sum and with such surety or sureties, as in such resolution the Board of Directors may direct. ARTICLE IX Amendments to Bylaws These Bylaws may be amended, altered, or repealed, or new Bylaws may be adopted, solely pursuant to Article TWELFTH of the Articles of Incorporation of the Corporation.

EX-10.42

-1- 4861-2267-0144.2 2019 STOCK COMPENSATION PLAN As Amended and Restated as of February 20, 2023 ARTICLE I. PURPOSE AND HISTORY 1.1. Purpose. The purpose of the Kontoor Brands, Inc. 2019 Stock Compensation Plan (as may be amended from time to time, the “Plan”) is to strengthen the ability of Kontoor Brands, Inc. (the “Company”) to attract, motivate, and retain employees and directors of superior ability, to more closely align the interests of such persons with those of the Company’s shareholders and to promote the success of the Company’s business. 1.2. History. The Plan was adopted by the Board and approved by its shareholders in connection with the separation of the Company from V.F. Corporation on May 22, 2019. The Plan is being amended and restated as of February 20, 2023 to incorporate certain enhancements and other updates. ARTICLE II. GENERAL DEFINITIONS In addition to terms defined in other Articles of the Plan, the following are defined terms for purposes of the Plan: 2.1. “Agreement” The written instrument (which may be in electronic form) evidencing the grant to a Participant of an Award. Each Participant may be issued one or more Agreements from time to time, evidencing one or more Awards. 2.2. “Award” Any award granted under this Plan. 2.3. “Board” The Board of Directors of the Company. 2.4. “Change in Control” A change in control shall be deemed to have occurred if, after the date of grant of a given Award, (i) any “Person” (as such term is used in §13(d) and §14(d) of the Exchange Act), except for (A) those certain trustees under Deeds of Trust dated August 21, 1951 and under the Will of John E. Barbey, deceased (a “Trust” or the “Trustee”), and (B) any employee benefit plan of the Company or any Subsidiary, or any entity holding voting securities of the Company for or pursuant to the terms of any such plan (a “Benefit Plan” or the “Benefit Plans”), acquires beneficial ownership of Company voting securities and thereupon is the beneficial owner, directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the Company’s then outstanding securities; (ii) there occurs a contested proxy solicitation of the Company’s shareholders that results in the contesting party obtaining the ability to vote securities representing 30% or more of the combined voting power of the Company’s then outstanding securities; (iii) there is consummated a sale, exchange, transfer or other disposition of substantially all of the assets of the Company to another entity, except to an entity controlled directly or indirectly by the Company, or a merger, consolidation or other reorganization of the Company in which the voting securities of the Company outstanding Exhibit 10.42

-2- 4861-2267-0144.2 immediately prior to such event do not represent (either by remaining outstanding or by being converted into voting securities of a surviving or parent entity) at least 50% or more of the combined voting power of the outstanding voting securities of the Company or such surviving or parent entity (without a concentration of beneficial ownership that would trigger a change in control under clause (i) applying that provision to any surviving or parent entity), or a plan of liquidation or dissolution of the Company other than pursuant to bankruptcy or insolvency laws is adopted and implementation of such plan has commenced; or (iv) during any period of two consecutive years or less (commencing on or after the date of grant of a given Award), individuals who at the beginning of such period constituted the Board, together with all new directors whose election or nomination during such period (other than any new director whose initial assumption of office during such period followed an actual or threatened election contest in which such new director challenged an incumbent or Board-approved nominee) was approved by a vote of at least two-thirds of the directors then still in office who were directors either at the beginning of the period or previously so approved (together, the “Continuing Directors”), cease for any reason to constitute at least a majority of the Board. Notwithstanding the foregoing, a Change in Control shall not be deemed to have occurred for purposes of this Plan (x) in the event of a sale, exchange, transfer or other disposition of substantially all of the assets of the Company to, or a merger, consolidation or other reorganization involving the Company and, an entity controlled by one or more officers of the Company (separately from their role as Company officers) or in which such officers have, directly or indirectly, at least a 5% equity or ownership interest unrelated to any interest in the Company, or in a transaction otherwise commonly referred to as a “management leveraged buyout.” Notwithstanding the foregoing, the Board may, by resolution adopted by a majority of the Board and by at least two-thirds of the Continuing Directors who were in office at the date a Change in Control occurred, declare that a Change in Control in clause (i) or (ii) has become ineffective for purposes of this Plan if the following conditions then exist: (x) the declaration is made within 120 days of the Change in Control; and (y) no person, except for (A) the Trusts, and the Benefit Plans, either is the beneficial owner, directly or indirectly, of securities of the Company representing 10% or more of the combined voting power of the Company’s outstanding securities or has the ability or power to vote securities representing 10% or more of the combined voting power of the Company’s then outstanding securities. If such a declaration shall be properly made, the Change in Control shall be ineffective ab initio. 2.5. “Code” The Internal Revenue Code of 1986, as amended, and applicable regulations and rulings and guidance issued thereunder. 2.6. “Committee” The Talent and Compensation Committee of the Board (or a designated successor to such committee), the composition and governance of which is established in the Committee’s Charter as approved from time to time by the Board and subject to other corporate governance documents of the Company. No action of the Committee shall be void or deemed to be without authority due to the failure of any member, at the time the action was taken, to meet any qualification standard set forth in the Committee Charter or this Plan. 2.7. “Common Stock” The common stock of the Company as described in the Company’s Articles of Incorporation, or such other stock as shall be substituted therefor.

-3- 4861-2267-0144.2 2.8. “Company” Kontoor Brands, Inc., a North Carolina corporation, or any successor to the Company. 2.9. “Date of Grant” The date on which the granting of an Award is authorized by the Committee, or such later date as is specified by the Committee or by a provision in this Plan applicable to the Award. 2.10. “Director” A member of the Board who is not an Employee. 2.11. “Disposition” Any sale, transfer, encumbrance, gift, donation, assignment, pledge, hypothecation, or other disposition of an Award, whether similar or dissimilar to those previously enumerated, whether voluntary or involuntary, and whether during the Participant’s lifetime or upon or after his or her death, including, but not limited to, any disposition by operation of law, by court order, by judicial process, or by foreclosure, levy or attachment. A transfer or forfeiture of an Award to the Company is not a Disposition. 2.12. “Employee” Any employee of the Company or a Subsidiary. 2.13. “Exchange Act” The Securities Exchange Act of 1934, as amended, and applicable regulations and rulings issued thereunder. 2.14. “Fair Market Value” Unless otherwise determined in good faith by the Committee or under procedures established by the Committee, the average of the reported high and low sales price of the Common Stock on the date on which Fair Market Value is to be determined (or if there was no reported sale on such date, the next preceding date on which any reported sale occurred) on the principal exchange or in such other principal market on which the Common Stock is trading. 2.15. “Full-Value Award” An Award relating to shares other than (i) Stock Options that are treated as exercisable for shares under applicable accounting rules and (ii) Awards for which the Participant pays the grant-date Fair Market Value of the shares covered by the Award directly or by electively giving up a right to receive a cash payment from the Company or a Subsidiary of an amount equal to the grant-date Fair Market Value of such shares. 2.16. “Incentive Award” An Award granted under Article IX denominated in cash and earnable based on performance measured over a specified performance period. 2.17. “Incentive Stock Option” A Stock Option intended to satisfy the requirements of Section 422(b) of the Code. 2.18. “Non-qualified Stock Option” A Stock Option other than an Incentive Stock Option. 2.19. “Participant” An Employee or Director selected by the Committee to receive an Award; such person remains a Participant until all obligations of the Company and of such person or his or her beneficiaries relating to the Award have been fulfilled or otherwise ended.

-4- 4861-2267-0144.2 2.20. “Replacement Plan” The Kontoor Brands, Inc. 1996 Stock Compensation Plan (a VF Corporation Plan Assumed by Kontoor Brands, Inc. Relating to Kontoor Employee Awards), under which equity awards have been granted by the Company in replacement of certain awards granted by VF Corporation prior to the spinoff by VF Corporation of the Company completed on May 22, 2019. The Replacement Plan, which is attached to this Plan as Appendix B, constitutes a sub-plan under this Plan. 2.21. “Restricted Awards” Restricted Stock and Restricted Stock Units. 2.22. “Restricted Stock” Common Stock that is subject to restrictions and awarded to Participants under Article VIII of this Plan and any Common Stock purchased with or issued in respect of dividends and distributions on the Restricted Stock. 2.23. “Restricted Stock Units” Stock Units that may be subject to a risk of forfeiture or other restrictions and awarded to Participants under Article VIII of this Plan, including Stock Units resulting from deemed reinvestment of dividend equivalents on Restricted Stock Units. 2.24. “Retirement” Unless otherwise specified in a Participant’s Award documents, employment separation from the Company or any of its Subsidiaries after attaining age 55 and at least 10 years of service with the Company and/or any of its Subsidiaries, provided that an employment separation at a time there exists grounds for the Company to terminate the Employee for cause (as defined by the Committee) will not constitute a Retirement. Unless otherwise determined by the Committee, service with a predecessor company (i.e., VF Corporation (prior to the spinoff of the Company) or a company acquired by the Company or a Subsidiary) shall be counted towards the calculation of an employee’s years of service with the Company and/or its Subsidiaries for purposes of this Plan. With respect to any Director Award, “Retirement” means termination of service to the Company as a Director. 2.25. “Rule 16b-3” Rule 16b-3 under the Exchange Act or any successor thereto. 2.26. “Securities Act” The Securities Act of 1933, as amended, and applicable regulations and rulings issued thereunder. 2.27. “Service Provider” A person providing services to the Company or a subsidiary in a capacity other than as an Employee or Director (for example, a consultant or advisor), provided that Awards other than those under Article IX may be granted only to a natural person who qualifies as an “employee” within the meaning of General Instruction A.1 (a)(1) to Form S-8 (or a successor provision) under the Securities Act. 2.28. “Stock Appreciation Right” An Award granted under Section 7.5. 2.29. “Stock Option” An award of a right to acquire Common Stock pursuant to Article VII 2.30. “Stock Units” An unfunded obligation of the Company, the terms of which are set forth in Section 8.6.

-5- 4861-2267-0144.2 2.31. “Subsidiary” Any majority-owned business organization of the Company or its direct or indirect subsidiaries, including but not limited to corporations, limited liability companies, partnerships and any “subsidiary corporation” as defined in Section 424(f) of the Code that is a subsidiary of the Company. 2.32. “Substitute Award” An Award granted in assumption of or in substitution for an award of a company or business acquired by the Company or a Subsidiary or affiliate or with which the Company or a Subsidiary or affiliate combines. ARTICLE III. SHARES OF COMMON STOCK SUBJECT TO THE PLAN 3.1. Common Stock Authorized. Subject to the provisions of this Article and Article XI, the total aggregate number of shares of Common Stock that may be delivered pursuant to Awards shall not exceed 7.5 million shares plus shares that are reserved and available for awards assumed by the Company under the Replacement Plan. Each share delivered in connection with a Full-Value Award, and each share delivered or deemed to be delivered in connection with Stock Options or other non-Full-Value Awards, shall be counted against this limit as one share in accordance with Section 3.2. 3.2. Share Counting Rules. For purposes of the limitations specified in Section 3.1, the Committee may adopt reasonable counting procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or substitute awards) and make adjustments in accordance with this Section 3.2. Shares shall be counted against those reserved to the extent that such shares have been delivered and are no longer subject to a risk of forfeiture, except that shares withheld to pay the exercise price or taxes upon exercise of a Stock Option (including a Stock Appreciation Right) or upon the vesting or settlement of any Award shall be deemed to be delivered for purposes of the limit set forth in Section 3.1. Accordingly, to the extent that an Award under the Plan (including the Replacement Plan) is canceled, expired, forfeited, or otherwise terminated without delivery of shares to the Participant (and without delivery of cash in the case of an Award that was settleable potentially in shares or cash), the shares retained by or returned to the Company will not be deemed to have been delivered under the Plan. An Award that can be settled only in cash shall not count against the shares reserved under the Plan. The Committee may determine that Awards may be outstanding that relate to more shares than the aggregate remaining available under the Plan so long as Awards will not in fact result in delivery (or deemed delivery) and vesting of shares in excess of the number then available under the Plan. In addition, in the case of any Substitute Award, shares delivered or deliverable in connection with such Substitute Award shall not be counted against the number of shares reserved under the Plan. 3.3. Shares Available. The shares of Common Stock to be delivered under this Plan shall be made available from authorized and unissued shares of Common Stock. ARTICLE IV. ADMINISTRATION OF THE PLAN 4.1. Committee. The Plan generally shall be administered by the Committee, subject to this Article IV. The Committee may act through subcommittees, including for purposes of

-6- 4861-2267-0144.2 perfecting exemptions under Rule 16b-3 under the Exchange Act, in which case the subcommittee shall be subject to and have authority under the charter applicable to the Committee, and the acts of the subcommittee shall be deemed to be acts of the Committee hereunder. The foregoing notwithstanding, the Board may perform any function of the Committee under the Plan, including for purposes of approving grants of Awards to Directors. In any case in which the Board is performing a function of the Committee under the Plan, each reference to the Committee herein shall be deemed to refer to the Board, except where the context otherwise requires. The Committee may otherwise act through with members of the Committee abstaining or recusing themselves to ensure compliance with regulatory requirements or to promote effective governance, as determined by the Committee. 4.2. Powers. The Committee has discretionary authority to determine the Employees and Directors to whom, and the time or times at which, Awards shall be granted. The Committee also has authority to determine the amount of shares of Common Stock that shall be subject to each Award and the terms, conditions, and limitations of each Award, subject to the express provisions of this Plan. The Committee shall have the discretion to interpret this Plan and to make all other determinations necessary for Plan administration. The Committee has authority to prescribe, amend and rescind any rules and regulations relating to this Plan, subject to the express provisions of this Plan. All Committee interpretations, determinations, and actions shall be in the sole discretion of the Committee and shall be binding on all parties, including beneficiaries. The Committee may correct any defect or supply any omission or reconcile any inconsistency in this Plan or in any Agreement in the manner and to the extent it shall deem expedient to carry it into effect, and it shall be the sole and final judge of such expediency. The Committee may specify that any Award will be settled in cash rather than by delivery of shares. To the fullest extent authorized under applicable provisions of the North Carolina Business Act, the Committee may delegate to officers or managers of the Company or any subsidiary or affiliate, or committees thereof, the authority, subject to such terms as the Committee shall determine, to perform such functions, including administrative functions, as the Committee may determine, to the extent that such delegation (i) will not result in the loss of an exemption under Rule 16b-3(d) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company, (ii) will not result in a related-person transaction with an executive officer required to be disclosed under Item 404(a) of Regulation S-K (in accordance with Instruction 5.a.ii thereunder) under the Exchange Act, and (iii) is permitted under other applicable laws and regulations. 4.3. Agreements. Awards shall be evidenced by an Agreement and may include any terms and conditions not inconsistent with this Plan, as the Committee may determine. 4.4. No Liability. The Committee and each member thereof, and any person acting pursuant to authority delegated by the Committee, shall be entitled, in good faith, to rely or act upon any report or other information furnished to him or her by any officer or other employee of the Company or any subsidiary, the Company’s independent certified public accountants, or any executive compensation consultant, legal counsel or other professional retained by the Company to assist in the administration of the Plan. Members of the Committee, any person acting pursuant to authority delegated by the Committee, and any officer or employee of the Company or a subsidiary or affiliate acting at the direction or on behalf of the Committee or a delegee shall not be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan, any Award or any Agreement, and any such person shall, to the extent

-7- 4861-2267-0144.2 permitted by law, be fully indemnified and protected by the Company with respect to any such action, determination, or interpretation. ARTICLE V. ELIGIBILITY 5.1. Participation. Participants shall be selected by the Committee from the Employees, Directors and Service Providers. Such designation may be by individual or by class. 5.2. Incentive Stock Option Eligibility. A Director shall not be eligible for the grant of an Incentive Stock Option. In addition, no Employee shall be eligible for the grant of an Incentive Stock Option who owns (within the meaning of Section 422(b) of the Code), or would own immediately before the grant of such Incentive Stock Option, directly or indirectly, stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company or any Subsidiary. ARTICLE VI. TYPES OF AWARDS; MINIMUM VESTING 6.1. Award Types. The types of Awards under this Plan are Stock Options as described in Article VII, Restricted Awards (Restricted Stock and Restricted Stock Units) as described in Article VIII, and Incentive Awards as described in Article IX. The Committee may, in its discretion, permit holders of Awards under this Plan to surrender outstanding Awards in order to exercise or realize the rights under other Awards subject to the restriction on repricing set forth in Section 13.2. 6.2. Minimum Vesting Requirements. Other provisions of the Plan notwithstanding, Awards (other than Awards that can be settled only in cash) shall vest no earlier than the first anniversary of the date on which the Award is granted; provided, however, that the following Awards shall not be subject to this minimum vesting requirement: any (i) Substitute Award; (ii) shares of Common Stock delivered in lieu of fully vested cash awards at the election of the Participant; (iii) Awards to non-employee Directors that vest at or after the earlier of the one-year anniversary of the date of grant or the next annual meeting of stockholders that is at least 50 weeks after the immediately preceding year’s annual meeting; and (iv) any other Awards as designated by the Committee relating to not more than five percent (5%) of the aggregate shares reserved for grant under Section 3.1 (as adjusted under Section 11.1); and provided further that the foregoing restriction does not apply to the Committee’s discretion to provide for accelerated exercisability or vesting of any Award in cases of death, disability or a Change in Control, in the terms of the Award Agreement or otherwise. In the case of Awards subject to the minimum vesting requirement and having proportionate vesting over a specified period, the proportionate vesting shall not apply during the initial year (so, for example, monthly vesting in the first year is not permitted for such Awards under the Plan).

-8- 4861-2267-0144.2 ARTICLE VII. STOCK OPTIONS 7.1. Exercise Price. The exercise price of Common Stock under each Stock Option shall be not less than 100 percent of the Fair Market Value of the Common Stock on the Date of Grant, other than Stock Options issued as Substitute Awards. 7.2. Term. Stock Options may be exercised as determined by the Committee, provided that Stock Options may in no event be exercised later than ten years from the Date of Grant. During the Participant’s lifetime, only the Participant may exercise an Incentive Stock Option. The Committee may amend the terms of an Incentive Stock Option at any time to include provisions that have the effect of changing such Incentive Stock Option to a Non-qualified Stock Option, or vice versa (to the extent any such change is permitted by applicable law, and subject to Section 13.1 except that the change in tax treatment of the Stock Option shall not be deemed to be materially adverse to the Participant for purposes of Section 13.1). 7.3. Method of Exercise. Upon the exercise of a Stock Option, the exercise price shall be payable in full in cash or an equivalent acceptable to the Committee. At the discretion of the Committee and provided such payment can be effected without causing the Participant to incur liability under Section 16(b) of the Exchange Act or causing the Company to incur additional expense under applicable accounting rules, the Committee may permit the exercise price to be paid by assigning and delivering to the Company shares of Common Stock previously acquired by the Participant or may require that, or permit the Participant to direct that, the Company withhold shares from the Stock Option shares having a value equal to the exercise price (or portion thereof to be paid through such share withholding). Any shares so assigned and delivered to the Company or withheld by the Company in payment or partial payment of the exercise price shall be valued at the Fair Market Value of the Common Stock on the exercise date. In addition, at the request of the Participant and to the extent permitted by applicable law, the Company in its discretion may approve arrangements with a brokerage firm under which such brokerage firm, on behalf of the Participant, shall pay to the Company the exercise price of the Stock Options being exercised, and the Company, pursuant to an irrevocable notice from the Participant, shall promptly deliver the shares being purchased to such firm. 7.4. Other Stock Option Terms. No dividend equivalent rights may be granted with respect to a Stock Option entitling the Participant to the economic benefit of dividends paid prior to the exercise of the Stock Option on the Common Stock underlying the Stock Option. With respect to Incentive Stock Options, the aggregate Fair Market Value (determined at the Date of Grant) of the Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year (under all stock option plans of the Company and its Subsidiaries) shall not exceed $100,000, or such other amount as may be prescribed under the Code. If any Stock Option intended to be an Incentive Stock Option fails to so qualify, including under the requirement set forth in this Section 7.4, such Stock Option (or the affected portion of the Stock Option) shall be deemed to be a Non-qualified Stock Option and shall be exercisable in accordance with the Plan and the Stock Option’s terms. 7.5. Stock Appreciation Rights. A Stock Option may be granted with terms requiring the exercise price to be paid by means of the Company withholding shares subject to the Stock

-9- 4861-2267-0144.2 Option upon exercise, in which case such Award may be designated as a “Stock Appreciation Right.” The Committee may, at the time of grant, specify that the Fair Market Value of the Stock Option shares deliverable upon exercise of such Award will be paid in cash in lieu of delivery of shares, such that the Award is a cash-settled Stock Appreciation Right. ARTICLE VIII. RESTRICTED AWARDS 8.1. Types of Award. The Committee, in its discretion, is authorized to grant Restricted Awards either as Service Awards or Performance Awards. As used herein, the term “Service Award” refers to any Restricted Award described in Section 8.2 and the term “Performance Award” refers to any Restricted Award described in Section 8.3. Restricted Stock shall be nontransferable until such time as all of the restrictions underlying the Award have been satisfied, except to the extent permitted under Section 12.5. 8.2. Service Award. The Committee may grant shares of Restricted Stock or Restricted Stock Units to a Participant subject to forfeiture upon an interruption in the Participant’s continuous service with the Company or a Subsidiary within a period specified by the Committee. The period during which Restricted Stock Units are subject to a risk of forfeiture may be shorter than the period during which settlement of the Restricted Stock Units is deferred. The foregoing notwithstanding, Stock Units granted with no minimum vesting period, as permitted on a limited basis under Section 6.2, shall be deemed to be Service Awards. 8.3. Performance Award. The Committee may grant Restricted Stock or Restricted Stock Units to a Participant subject to or upon the attainment of a performance objective based on such measure or measures of performance as the Committee may specify. In establishing the level of performance objective to be attained, the Committee may disregard or offset the effect of such items of income or expense and other factors as determined by the Committee. Notwithstanding attainment of the applicable performance objective or any provisions of this Plan to the contrary, the Committee shall have the power (which it may retain or may relinquish in the Agreement or other document), in its sole discretion, to impose service requirements required to be fulfilled by the Participant during the performance period or subsequent to the attainment of the performance objective. 8.4. Delivery. If a Participant, with respect to a Service Award, continuously remains in the employ of the Company or a Subsidiary for the period specified by the Committee, or, with respect to a Performance Award, if and to the extent that the Participant fulfills the requirements of the performance objective and any service requirements as may be imposed by the Committee, the related risk of forfeiture of shares awarded to such Participant as Restricted Stock shall lapse and any retained share certificates or other evidence of ownership shall be delivered to such Participant without any restrictions promptly after the applicable event, and the related risk of forfeiture applicable to Restricted Stock Units shall end and such Restricted Stock Units shall then and thereafter be settled in accordance with the terms of such Restricted Stock Units (including any elective deferral of settlement permitted by the Committee). The foregoing notwithstanding, the Committee may determine that any restrictions (and/or deferral period, to the extent permitted under Section 12.10) applicable to a Restricted Award shall be deemed to end or have ended on an accelerated basis at the time of the Participant’s death while employed or serving as a Director

-10- 4861-2267-0144.2 or upon the Participant’s termination of employment or service due to disability or Retirement or following a Change in Control, subject to Section 6.2. 8.5. Shareholder Rights. Except as otherwise provided in this Plan, each Participant shall have, with respect to all shares of Restricted Stock, all the rights of a shareholder of the Company, including the right to vote the Restricted Stock; provided, however, that, unless the Committee has provided for a different equitable treatment of dividends and distributions payable with respect to the Restricted Stock, all such dividends and distributions shall be retained by the Company and reinvested in additional shares of Common Stock to be issued in the name of the Participant. Any shares of Common Stock acquired as a result of reinvestment of such dividends or distributions shall also be Restricted Stock subject to the terms and conditions of this Plan (and if any other treatment of dividends and distributions is approved by the Committee, the amounts to be paid or credited to the Participant shall be subject to the same vesting terms and risk of forfeiture, including any performance conditions, as applied to the original Award; this requirement may not be altered by the Committee). A Participant shall have no rights of a shareholder relating to Restricted Stock Units or Stock Units until such time as shares are issued or delivered in settlement of such Restricted Stock Units or Stock Units. 8.6. Stock Units; Deferral of Receipt of Restricted Stock. A Stock Unit, whether or not restricted, shall represent the conditional right of the Participant to receive delivery of one share of Common Stock at a specified future date, subject to the terms of the Plan and the applicable Agreement. Until settled, a Stock Unit shall represent an unfunded and unsecured obligation of the Company with respect to which a Participant has rights no greater than those of a general creditor of the Company. Unless otherwise specified by the Committee, each Stock Unit will carry with it the right to crediting of an amount equal to dividends and distributions paid on a share of Common Stock (“dividend equivalents”), which amounts will be deemed reinvested in additional Stock Units, at the Fair Market Value of Common Stock at the dividend payment date. Such additional Stock Units (or any alternative form of crediting dividend equivalents) will be subject to the same risk of forfeiture (this requirement may not be altered by the Committee), other restrictions, and deferral of settlement as applied to the original Stock Units. Unless the Committee determines to settle Stock Units in cash, Stock Units shall be settled solely by issuance or delivery of shares of Common Stock. The Committee may, in its sole discretion and subject to compliance with Code Section 409A, permit Participants to convert their Restricted Stock into an equivalent number of stock units as of the date on which all applicable restrictions pertaining to the Restricted Stock would either lapse or be deemed satisfied (the “Vesting Date”), or by means of an exchange of the Restricted Stock for Restricted Stock Units before the Vesting Date. Any such request for conversion must (a) be made by the Participant at a time a valid deferral may be elected under Code Section 409A and (b) specify a distribution date that is valid under Code Section 409A and in any case is no earlier than the earlier of (i) the Participant’s termination of employment or (ii) the first anniversary of the Vesting Date. ARTICLE IX. INCENTIVE AWARDS The Committee, in its discretion, is authorized to grant Incentive Awards, which shall be Awards denominated as a cash amount and earnable based on achievement of a Performance

-11- 4861-2267-0144.2 Objective. The Committee may specify that an Incentive Award shall be settled in cash or in shares of Common Stock. ARTICLE X. FORFEITURE AND EXPIRATION OF AWARDS 10.1. Termination of Employment or Service. Subject to the express provisions of this Plan (including Section 6.2) and the terms of any applicable Agreement, the Committee, in its discretion, may provide for the forfeiture or continuation of any Award for such period and upon such terms and conditions as are determined by the Committee in the event that a Participant ceases to be an Employee or Director. In the absence of Committee action or except as otherwise provided in an Agreement, the following rules shall apply: (a) With respect to Stock Options granted to Employees, Stock Options shall be exercisable only so long as the Participant is an employee of the Company or a Subsidiary, except that (1) in the event of Retirement, the Stock Options shall continue to vest according to the original schedule, but no Stock Options may be exercised after the expiration of the earlier of the remaining term of such Stock Options or 36 months following the date of Retirement (in such case, Incentive Stock Options will become Non-Qualified Stock Options three months following Retirement); (2) in the event of permanent and total disability, the Stock Options shall continue to vest according to the original schedule, but no Stock Options may be exercised after the expiration of the earlier of the remaining term of such Stock Option or 36 months following the date of permanent and total disability; (3) in the event of death while an Employee, Stock Options held at the time of death by the Participant shall vest and become immediately exercisable and may be exercised by the estate or beneficiary of such Participant until the expiration of the earlier of the remaining term of such Stock Options or 36 months following the date of death; (4) in the event of the Participant’s voluntary separation of employment (other than a Retirement) or involuntary separation of employment by the Company for cause (as defined by the Committee), the Stock Options shall terminate and be forfeited as of the date of separation of employment; (5) in the event of the Participant’s involuntary separation of employment not for cause (as defined by the Committee) with severance pay (other than severance pay paid in a lump sum), the Stock Option shall continue to vest according to the original schedule, but no Stock Options may be exercised after the earlier of the remaining term of the Option or the end of the period of the Participant’s receipt of severance pay, if any, from the Company; and (6) in the event of an involuntary separation of employment without severance pay or if severance pay is paid in a lump sum, the Stock Option shall not be exercisable after the date of separation of employment; any portion of a Stock Option that is not vested at the time of permanent and total disability or any separation of employment and that would not vest and become exercisable during the period the Stock Option will remain outstanding under this Section 10.1(a) shall terminate and be forfeited as of the time of permanent and total disability or separation of employment, unless otherwise determined by the Committee within 45 days after such event; and (b) With respect to Restricted Awards granted to Employees, in the event of a Participant’s voluntary or involuntary separation before the expiration of the employment period specified by the Committee with respect to Service Awards, or before the fulfillment of the performance objective and any other restriction imposed by the Committee with respect to Performance Awards, any shares of Restricted Stock shall be returned to the Company and any

-12- 4861-2267-0144.2 Restricted Award shall be deemed to have been forfeited by the Participant as of the date of such separation. 10.2. Leave of Absence. With respect to an Award, the Committee may, in its sole discretion, determine that any Participant who is on leave of absence for any reason shall be considered to still be in the employ of the Company, provided that the Committee may, in its sole discretion, also determine that rights to such Award during a leave of absence shall be limited to the extent to which such rights were earned or vested when such leave of absence began or that vesting will be tolled during such leave of absence. 10.3. Additional Forfeiture Provisions. The Committee may condition a Participant’s right to receive a grant of an Award, to exercise the Award, to receive a settlement or distribution with respect to the Award, to retain cash, Stock, other Awards, or other property acquired in connection with an Award, or to retain the profit or gain realized by a Participant in connection with an Award, upon compliance by the Participant with specified conditions that protect the business interests of the Company and its subsidiaries and affiliates from harmful actions of the Participant or otherwise conform to high standards of corporate governance, including but not limited to (i) conditions providing for such forfeitures in the event that Company financial statements are restated due to misconduct if the Participant bears substantial responsibility for such misconduct or if the restated financial information would have adversely affected the level of achievement of performance measures upon which the earning or value of the Participant’s Award was based; and (ii) conditions relating to non-competition, confidentiality of information relating to or possessed by the Company, non-solicitation of customers, suppliers, and employees of the Company, cooperation in litigation, non-disparagement of the Company and its subsidiaries and affiliates and the officers, directors and affiliates of the Company and its subsidiaries and affiliates, and other restrictions upon or covenants of the Participant, including during specified periods following termination of employment or service to the Company. Accordingly, an Award may include terms providing for a recoupment, “clawback” or forfeiture from the Participant of the profit or gain realized by a Participant in connection with an Award, including cash or other proceeds received upon sale of Stock acquired in connection with an Award. References in the Plan or an Agreement to lapse of restrictions or risk of forfeiture do not apply to the additional forfeiture provisions authorized under this Section 10.3, unless the lapse of the forfeiture provisions under this Section 10.3 is specifically stated. ARTICLE XI. ADJUSTMENT PROVISIONS 11.1. Share Adjustments. If the number of outstanding shares of Common Stock is increased, decreased or exchanged for a different number or kind of shares or other securities, or if additional, new or different shares or other securities are distributed with respect to such shares of Common Stock or other securities, through merger, consolidation, sale of all or substantially all of the assets of the Company, reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split, spinoff or other distribution with respect to such shares of Common Stock or other securities, an appropriate adjustment in order to preserve the benefits or potential benefits intended to be made available to the Participants may be made, in the discretion of the Committee, in all or any of the following (i) the maximum number and kind of shares provided in Section 3.1; (ii) the number and kind of shares or other securities subject to then outstanding

-13- 4861-2267-0144.2 Awards; (iii) the price for each share or other unit of any other securities subject to then outstanding Awards; and (iv) the terms of performance goals based on per share metrics or otherwise affected by such events. The Committee may also make any other adjustments, or take such action as the Committee, in its discretion, deems appropriate in order to preserve the benefits or potential benefits intended to be made available to the Participants. In furtherance of the foregoing, in the event of an equity restructuring, as defined in FASB ASC Topic 718, that affects the Common Stock, a Participant shall have a legal right to an adjustment to the Participant’s Award that will preserve without enlarging the value of the Award, with the manner of such adjustment to be determined by the Committee in its discretion, and subject to any limitation on this right set forth in the applicable Award Agreement. Any fractional share resulting from such adjustment may be eliminated. In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards (including performance criteria) in recognition of unusual or nonrecurring events (including events described in this Section 11.1) affecting the Company, any Subsidiary or any business unit, or the financial statements of the Company or any Subsidiary, or in response to changes in applicable laws, regulations, accounting principles, tax rates or business conditions or in view of the Committee’s assessment of the business strategy of the Company, any Subsidiary or business unit thereof, performance of comparable organizations, economic and business conditions, personal performance of a Participant, and any other circumstances deemed relevant, subject to the limitation in Section 12.15. If, in a transaction triggering an adjustment hereunder, public shareholders of the Company receive cash for their equity interest in the Company, an adjustment providing for cancellation of an Award in exchange for a cash payment based solely on the then intrinsic value of the Award shall be deemed to meet the requirements of this Section 11.1. Adjustments determined by the Committee shall be final, binding and conclusive. 11.2. Corporate Changes. Subject to Article XIII, upon (i) the dissolution or liquidation of the Company; (ii) a reorganization, merger or consolidation (other than a merger or consolidation effecting a reincorporation of the Company in another state or any other merger or consolidation in which the shareholders of the surviving Company and their proportionate interests therein immediately after the merger or consolidation are substantially identical to the shareholders of the Company and their proportionate interests therein immediately prior to the merger or consolidation) of the Company with one or more corporations, following which the Company is not the surviving Company (or survives only as a subsidiary of another Company in a transaction in which the shareholders of the parent of the Company and their proportionate interests therein immediately after the transaction are not substantially identical to the shareholders of the Company and their proportionate interests therein immediately prior to the transaction); (iii) the sale of all or substantially all of the assets of the Company; or (iv) the occurrence of a Change in Control, subject to the terms of any applicable Agreement, the Committee serving prior to the date of the applicable event may, to the extent permitted in Section 3.1 of this Plan (and subject to any applicable restriction on repricing under Section 13.2), in its discretion and without obtaining shareholder approval, take any one or more of the following actions with respect to any Participant: (a) accelerate the vesting and exercise dates of any or all outstanding Awards; (b) eliminate any and all restrictions with respect to outstanding Restricted Awards;

-14- 4861-2267-0144.2 (c) determine the level of achieved performance, projected full-performance period performance, or other specified level of performance to be deemed to be the level of achievement of the performance objective for any Performance Award; (d) pay cash to any or all holders of Stock Options in exchange for the cancellation of their outstanding Stock Options and cash out all outstanding Stock Units or Restricted Awards, provided that payment of consideration equivalent to the consideration received by shareholders, net of any exercise price payable with respect to the Award, shall be sufficient payment for the cash-out of an Award (for clarity, if a Stock Option had an exercise price in excess of such consideration, the Stock Option could be cancelled with no payment to the Participant); (e) modify the vesting terms of continuing, assumed or replaced awards to provide for vesting upon a Participant’s subsequent termination not for cause or voluntary termination for good reason; (f) grant new Awards to any Participants; or (g) make any other adjustments or amendments to outstanding Awards or determine that there shall be substitution of replacement or new awards by such successor employer Company or a parent or subsidiary company thereof, with appropriate adjustments as to the number and kind of shares or units subject to such awards and prices. 11.3. Binding Determination. Adjustments under Sections 11.1 and 11.2 shall be made by the Committee, and its determination as to what adjustments shall be made and the extent thereof shall be final, binding and conclusive. 11.4. Potential Limit on Payments to Avoid Excise Tax. Notwithstanding any other provision of this Plan to the contrary, if any payments or benefits paid by the Company pursuant to this Plan, including any accelerated vesting or similar provisions (“Plan Payments”), would cause some or all of the Plan Payments or any other payments made to or benefits received by a Participant in connection with a change in ownership or effective control, or a change in the ownership of a substantial portion of assets, in each case as defined in 26 C.F.R. s. 1.280G-1 (such payments or benefits, together with the Plan Payments, the “Total Payments”) to be subject to the tax (“Excise Tax”) imposed by Code Section 4999 but for this Section 11.4, then, except to the extent the Participant has in place an agreement or other arrangement that would provide a more favorable result to such Participant, the Total Payments shall be delivered either (i) in full or (ii) in an amount such that the value of the aggregate Total Payments that the Participant is entitled to receive shall be One Dollar ($1.00) less than the maximum amount that the Participant may receive without being subject to the Excise Tax, whichever of (i) or (ii) results in the receipt by the Participant of the greatest benefit on an after-tax basis (taking into account applicable federal, state and local income taxes and the Excise Tax). To the extent a reduction in the Total Payments is required pursuant to clause (ii) in the preceding sentence, payments or benefits included in the Total Payments shall be reduced or eliminated by applying the following principles, in order: (1) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (2) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and

-15- 4861-2267-0144.2 (3) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro rata among the payments or benefits included in the Total Payments (on the basis of the relative present value of the parachute payments). ARTICLE XII. GENERAL PROVISIONS 12.1. No Right to Employment. Nothing in this Plan or in any Agreement or instrument executed pursuant to this Plan shall confer upon any Participant (i) any right to continue in the employ of the Company or a Subsidiary or affect the Company’s or a Subsidiary’s right to terminate the employment of any Participant at any time with or without cause, or (ii) any right to continue to serve as a Director of the Company or affect any party’s right to remove such Participant as a Director. 12.2. Securities Requirements. The Company shall not be obligated to issue or transfer shares of Common Stock pursuant to an Award unless all applicable requirements imposed by federal and state laws, regulatory agencies, and securities exchanges upon which the Common Stock may be listed have been fully complied with. As a condition precedent to the issuance of shares pursuant to the grant or exercise of an Award, the Company may require the Participant to take any reasonable action to meet such requirements. 12.3. No Right to Stock. No Participant and no beneficiary or other person claiming under or through such Participant shall have any right, title or interest in any shares of Common Stock allocated or reserved under this Plan or subject to any Award except as to such shares of Common Stock, if any, that have been issued or transferred to such Participant or other person entitled to receive such Common Stock under the terms of the Award. 12.4. Withholding. The Company or a Subsidiary, as appropriate, shall have the right to deduct from all Awards paid in cash any federal, state, or local taxes as required by law to be withheld with respect to such cash payments. In the case of Awards paid or payable in Common Stock, the Participant or other person receiving such Common Stock may be required to pay to the Company or a Subsidiary, as appropriate, the amount of any such taxes which the Company or Subsidiary is required to withhold with respect to such Common Stock. Also, at the discretion of the Committee and provided such withholding can be effected without causing the Participant to incur liability under Section 16(b) of the Exchange Act, the Committee may require or permit the Participant to elect (i) to have the Company or Subsidiary withhold from the shares of Common Stock to be issued or transferred to the Participant the number of shares necessary to satisfy the Company’s or Subsidiary’s obligation to withhold taxes, such determination to be based on the shares’ fair market value as of the date the Participant becomes subject to income taxation with respect to the Award, (ii) deliver sufficient shares of Common Stock (based upon the fair market value at the date of withholding) to satisfy the withholding obligations, or (iii) deliver sufficient cash to satisfy the withholding obligations. Participants who elect to use such a stock withholding feature must make the election at the time and in the manner prescribed by the Committee. If shares of Common Stock are used to satisfy the withholding obligation, then the Fair Market Value of such shares may not exceed the total maximum statutory tax withholding obligations associated

-16- 4861-2267-0144.2 with the transaction to the extent needed for the Company or its Subsidiary to avoid an accounting charge. 12.5. No Disposition. No Award under this Plan may be the subject of any Disposition (excluding shares of Common Stock with respect to which all restrictions have lapsed), other than by will or the laws of descent or distribution or, if permitted by the Company, pursuant to a valid beneficiary designation. Any attempted Disposition in violation of this provision shall be void and ineffective for all purposes. Notwithstanding the foregoing, the Committee may, in its sole discretion, permit a Participant to transfer an Award other than an Incentive Stock Option, for estate-planning purposes, to (a) a member or members of the Participant’s immediate family, (b) a trust, the beneficiaries of which consist exclusively of members of the Participant’s immediate family, (c) a partnership, the partners of which consist exclusively of members of the Participant’s immediate family, or (d) any similar entity created for exclusive benefit of members of the Participant’s immediate family; provided, however, that (i) such Disposition must be not for value, and (ii) no such transfer is authorized for an Award if and to the extent that such authorization would trigger tax penalties or taxation of the Award earlier than the delivery of cash or non - forfeitable shares to the Participant (or, if later, the lapse of the substantial risk of forfeiture of delivered shares). 12.6. Severability; Construction. If any provision of this Plan is held to be illegal or invalid for any reason, then the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Plan shall be construed and enforced as if the illegal or invalid provision had never been included herein. Headings and subheadings are for convenience only and not to be conclusive with respect to construction of this Plan. 12.7. Governing Law. All questions arising with respect to the provisions of this Plan shall be determined by application of the laws of the State of North Carolina, except as may be required by applicable federal law. 12.8. Other Deferrals. Subject to Section 12.10, the Committee may permit selected Participants to elect to defer payment of Awards in accordance with procedures established by the Committee including, without limitation, procedures intended to defer taxation on such deferrals until receipt (including procedures designed to avoid incurrence of liability under Section l 6(b) of the Exchange Act). Any deferred payment, whether elected by the Participant or specified by an Agreement or by the Committee, may require forfeiture in accordance with stated events, as determined by the Committee. 12.9. Awards to Participants Outside the United States. The Committee may modify the terms of any Award under the Plan made to or held by a Participant who is then resident or primarily employed outside of the United States in any manner deemed by the Committee to be necessary or appropriate in order that such Award shall conform to laws, regulations and customs of the country in which the Participant is then resident or primarily employed, or so that the value and other benefits of the Award to the Participant, as affected by foreign tax laws and other restrictions applicable as a result of the Participant’s residence or employment abroad, shall be comparable to the value of such an Award to a Participant who is resident or primarily employed in the United States. The Committee is authorized to adopt subplans to achieve the purposes of this Section 12.9. An Award may have terms under this Section 12.9 that are inconsistent with the

-17- 4861-2267-0144.2 express terms of the Plan, including authorizing cash payments in lieu of issuance or delivery of shares, so long as such modifications will not contravene any applicable law or regulation or result in actual liability under Section 16(b) for the Participant whose Award is granted with or modified to provide such terms. 12.10. Compliance with Code Section 409A. Other provisions of the Plan notwithstanding, the terms of any Award that is deemed to be a deferral for purposes of Code Section 409A and that is held by an employee subject to United States federal income taxation (a “409A Award”), including any authority of the Company and rights of the Participant with respect to the 409A Award, shall be limited to those terms permitted under Section 409A, and any terms not permitted under Section 409A shall be automatically modified and limited to the extent necessary to conform with Section 409A. Terms of Awards shall be interpreted in a manner that, according to the character of the Award, results in an exemption from Code Section 409A or compliance with Code Section 409A. 409A Awards and Non-409A Awards will be subject to the Company’s “Compliance Rules Under Code Section 409A,” attached to this Plan as Appendix A. 12.11. No Loans to Participants; No Reload Awards. No credit shall be extended to Participants in the form of personal loans in connection with Awards, whether for purposes of paying the exercise price or withholding taxes or otherwise. Any amount due and payable to the Company by a Participant shall be immediately due and shall be paid as promptly as practicable. No term of an Award shall provide for automatic “reload” grants of additional Awards upon exercise of an Stock Option or otherwise as a term of an Award. 12.12. Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board nor its submission to the shareholders of the Company for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other incentive arrangements, apart from the Plan, as it may deem desirable, and such other arrangements may be either applicable generally or only in specific cases. 12.13. Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation (excluding awards of Restricted Stock). With respect to any payments not yet made to a Participant or obligations to deliver shares pursuant to an Award, nothing contained in the Plan or any Award shall give any such Participant any rights that are greater than those of a general creditor of the Company; provided that the Committee may authorize the creation of trusts and deposit therein cash, share, other Awards or other property, or make other arrangements to meet the Company’s obligations under the Plan. Such trusts or other arrangements shall be consistent with the “unfunded” status of the Plan unless the Committee otherwise determines with the consent of each affected Participant. 12.14. Section 83(b) Election; Participant to Give Notice of Disqualifying Disposition. If a Participant makes an election under Section 83(b) of the Code (to include in gross income in the year of grant the amounts specified in Code Section 83(b)) or under a similar provision of the laws of a jurisdiction outside the United States, then the Participant shall immediately notify the Company of such election and provide evidence to the Company that such election has been made. If any Participant shall make any disposition of shares delivered pursuant to the exercise of an Incentive Stock Option under the circumstances described in Code Section 421(b) (relating to

-18- 4861-2267-0144.2 certain disqualifying dispositions), the Participant shall notify the Company of such disposition within ten days thereof. 12.15. Certain Limitations Relating to Accounting Treatment of Awards. Other provisions of the Plan notwithstanding, the Committee’s authority under the Plan is limited to the extent necessary to ensure that any Award of a type that the Committee has intended to be “share- based equity” (and not a “share-based liability”) subject to fixed accounting with a measurement date at the time the award is initiated under FASB ASC Topic 718 shall not be deemed a share- based liability (subject to “variable” accounting) or subject to a measurement date later than the time the Award is initiated solely due to the existence of such authority, unless the Committee specifies otherwise in the Award Agreement or makes a decision during the life of the Award with explicit acknowledgment that the default accounting treatment under this Section 12.15 will be changed. 12.16. No Fractional Shares. No fractional shares or other securities may be issued or delivered pursuant to this Plan, and the Company may determine whether fractional shares will be rounded up to the nearest whole share; whether cash, other securities or other property will be paid or transferred in lieu of any fractional shares or other securities; or whether such fractional shares or other securities or any rights to fractional shares or other securities will be canceled, terminated or otherwise eliminated without compensation therefor; provided that, if the Company does not determine otherwise, fractional shares will be rounded up to the nearest whole share. 12.17. Limitations on Actions. Any legal action or proceeding with respect to this Plan, any Award or any award agreement, must be brought within one year (365 days) after the day the complaining party first knew or should have known of the events giving rise to the complaint. ARTICLE XIII. AMENDMENT AND TERMINATION 13.1. Amendments; Suspension; Termination. The Board may at any time amend, suspend (and if suspended, may reinstate) or terminate this Plan; provided, however, that the Board may not, without approval of the shareholders of the Company, amend this Plan so as to (a) increase the number of shares of Common Stock subject to this Plan except as permitted in Article XI or (b) reduce the exercise price for shares of Common Stock covered by Stock Options granted hereunder below the applicable price specified in Article VII of this Plan or (c) make a material revision to the Plan within the meaning of Section 303A.08 of the Listed Company Manual of the New York Stock Exchange as then in effect. The Committee is authorized to amend the Plan to the extent such action is within the scope of the Committee’s authority under its Charter, and subject to all other requirements that would apply if the Plan were being amended by action of the Board. The Committee is authorized to amend outstanding Awards, except as limited by the Plan. The foregoing notwithstanding, no amendment to the Plan or an Award Agreement or other action that materially and adversely affects a the rights of a Participant under an outstanding Award may be made or taken without the consent of such Participant. The authority of the Committee to waive or modify an Award term after the Award has been granted does not permit waiver or modification of a term that would be mandatory under the Plan for any Award newly granted at the date of the waiver or modification. Unless earlier terminated by action of the Board of Directors, the authority of the Committee to make grants under the Plan will terminate on the date that is ten years after

-19- 4861-2267-0144.2 the latest date upon which shareholders of the Company have approved the Plan (including approval of the Plan as amended and restated). 13.2. Restriction on Repricing. Without the approval of shareholders, the Committee will not amend or replace previously granted Stock Options (including Stock Appreciation Rights) in a transaction that constitutes a “repricing,” which for this purpose means any of the following or any other action that has the same effect:  Lowering the exercise price of a Stock Option after it is granted;  Any other action that is treated as a repricing under generally accepted accounting principles;  Canceling a Stock Option at a time when its exercise price exceeds the fair market value of the underlying Stock, in exchange for another Stock Option, a Restricted Award, other equity or other cash or property (such an action will be considered a repricing regardless of whether a replacement Award is delivered simultaneously with the cancellation, regardless of whether it is treated as a repricing under generally accepted accounting principles, and regardless of whether it is voluntary on the part of the Participant); provided, however, that the foregoing transactions shall not be deemed a repricing if pursuant to an adjustment authorized under Section 11.1. ARTICLE XIV. DATE OF PLAN ADOPTION; EFFECTIVENESS; PLAN TERMINATION 14.1. Date of Plan Adoption. This Plan was adopted by the Board on April 29, 2019 and approved by the Company’s shareholder on April 29, 2019. This Plan shall become effective upon completion of the spinoff of the Company by VF Corporation, and thereafter shall continue in effect with respect to Awards granted before termination of the Committee’s authority to grant new Awards under Section 13.1 (including authority to modify Awards to the fullest extent permitted under the Plan) until all outstanding Awards have been settled, terminated or forfeited and the Company and Participants have no further obligations or rights with respect to such Awards.

-20- 4861-2267-0144.2 Appendix A Compliance Rules Under Code Section 409A 1. General Rules for Section 409A Compliance. The following rules will apply to the 2019 Stock Compensation Plan (the “Plan”). Capitalized terms used herein have the definitions as set forth in the Plan. If so designated by the Committee, these Compliance Rules may be applied to any other specified, agreement or arrangement. (a) 409A Awards and Deferrals. Other provisions of the Plan notwithstanding, the terms of any 409A Award, including any authority of the Company and rights of the Participant with respect to the 409A Award, shall be limited to those terms permitted under Section 409A, and any terms not permitted under Section 409A shall be automatically modified and limited to the extent necessary to conform with Section 409A but only to the extent that such modification or limitation is permitted under Code Section 409A and the regulations and guidance issued thereunder. The following rules will apply to Awards: (i) Elections. If a Participant is permitted to elect to defer compensation and in lieu thereof receive an Award, or is permitted to elect to defer any payment under an Award, such election will be permitted only at times and otherwise in compliance with Section 409A. (ii) Changes in Distribution Terms. The Committee may, in its discretion, require or permit on an elective basis a change in the distribution terms applicable to 409A Awards (and Non-409A Awards that qualify for the short-term deferral exemption under Section 409A) in accordance with, and to the fullest extent permitted by, applicable guidance of the Internal Revenue Service under Code Section 409A. (iii) Exercise and Distribution. Except as provided in Section 1(a)(iv) hereof, no 409A Award shall be exercisable (if the exercise would result in a distribution) or otherwise distributable to a Participant (or his or her beneficiary) except upon the occurrence of one or more of the following (or a date related to the occurrence of one of the following), which must be specified in a written document governing such 409A Award and otherwise meet the requirements of Treasury Regulation§ 1.409A-3. (A) Specified Time. A specified time or a fixed schedule; (B) Separation from Service. The Participant’s separation from service (within the meaning of Treasury Regulation§ 1.409A-l(h) and other applicable rules under Code Section 409A); provided, however, that if the Participant is a “specified employee” under Treasury Regulation§ 1.409A-1(i), settlement under this Section l(a)(iii)(B) that otherwise would occur within six months after a separation from service shall instead occur at the expiration of the six-month period following separation from service under Section 409A(a)(2)(B)(i). During such six-month delay period, no acceleration of settlement

-21- 4861-2267-0144.2 may occur, except (1) acceleration may occur in the event of death of the Participant, (2), if the distribution date was specified as the earlier of separation from service or a fixed date and the fixed date falls within the delay period, the distribution shall be triggered by the fixed date, and (3) acceleration may be permitted otherwise if and to the extent permitted under Section 409A. In the case of installments, this delay shall not affect the timing of any installment otherwise payable after the six-month delay period. With respect to any 409A Award, a reference in any agreement or other governing document to a “termination of employment” that triggers a distribution shall be deemed to mean a “separation from service” within the meaning of Treasury Regulation§ 1.409A-l(h); (C) Death. The death of the Participant. Unless a specific time otherwise is stated for payment of a 409A Award upon death, such payment shall occur at a time compliant with Code Section 409A; (D) Disability. The date the Participant has experienced a 409A Disability (as defined below); and (E) 409A Change in Control. The occurrence of a 409A Change in Control (as defined below). (iv) No Acceleration. The exercise or distribution of a 409A Award may not be accelerated prior to the time specified in accordance with Section 1(a)(iii) hereof, except in the case of one of the following events: (A) Unforeseeable Emergency. The occurrence of an Unforeseeable Emergency, as defined below, but only if the net amount payable upon such settlement does not exceed the amounts necessary to relieve such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the settlement, after taking into account the extent to which the emergency is or may be relieved through reimbursement or compensation from insurance or otherwise or by liquidation of the Participant’s other assets (to the extent such liquidation would not itself cause severe financial hardship), or by cessation of deferrals under the Plan. Upon a finding that an Unforeseeable Emergency has occurred with respect to a Participant, any election of the Participant to defer compensation that will be earned in whole or part by services in the year in which the emergency occurred or is found to continue will be immediately cancelled; (B) Domestic Relations Order. The 409A Award may permit the acceleration of the exercise or distribution time or schedule to an individual other than the Participant as may be necessary to comply

-22- 4861-2267-0144.2 with the terms of a domestic relations order (as defined in Section 414(p)(l)(B) of the Code); (C) Conflicts of Interest. Such 409A Award may permit the acceleration of the settlement time or schedule as may be necessary to comply with an ethics agreement with the Federal government or to comply with a Federal, state, local or foreign ethics law or conflict of interest law in compliance with Treasury Regulation§ 1.409A-3(j)(4)(iii); and (D) Change. The Committee may exercise the discretionary right to terminate the Plan upon or within 12 months after a 409A Change in Control or otherwise to the extent permitted under Treasury Regulation § 1.409A-3(j)(4)(ix), or accelerate settlement of such 409A Award in any other circumstance permitted under Treasury Regulation§ 1.409A-3. (v) Definitions. For purposes of this Section 1, the following terms shall be defined as set forth below: (A) “409A Change in Control” shall be deemed to have occurred if, in connection with any event defined as a change in control relating to a 409A Award under any applicable Company document, there occurs a change in the ownership of the Company, a change in effective control of the Company, or a change in the ownership of a substantial portion of the assets of the Company, as defined in Treasury Regulation§ 1.409A-3(i)(5). (B) “409A Disability” means an event which results in the Participant being (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii), by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company or its subsidiaries. (C) “Unforeseeable Emergency” means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Code Section 152, without regard to Code Sections 152(b) (1), (b)(2), and (d)(1)(B)) of the Participant, loss of the Participant’s property due to casualty, or similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the

-23- 4861-2267-0144.2 Participant, and otherwise meeting the definition set forth in Treasury Regulation § 1.409A-3(i)(3). (vi) Time of Distribution. In the case of any distribution of a 409A Award, if the timing of such distribution is not otherwise specified in the Plan or an Award agreement or other governing document, the distribution shall be made within 60 days after the date at which the settlement of the Award is specified to occur. In the case of any distribution of a 409A Award during a specified period following a settlement date, the maximum period shall be 90 days, and the Participant shall have no influence (other than deferral elections permitted under Section 409A) on any determination as to the tax year in which the distribution will be made during any period in which a distribution may be made. (vii) Determination of “Specified Employee”. For purposes of a distribution under Section l(a)(iii)(B), status of a Participant as a “specified employee” shall be determined annually under the Company’s administrative procedure for such determination for purposes of all plans subject to Code Section 409A. (viii) Non-Transferability. The provisions of the Plan notwithstanding, no 409A Award or right relating thereto shall be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment by creditors of the Participant or the Participant’s beneficiary. (ix) Limitation on Setoffs. If the Company has a right of setoff that could apply to a 409A Award, such right may only be exercised at the time the 409A Award would have been distributed to the Participant or his or her beneficiary, and may be exercised only as a setoff against an obligation that arose not more than 30 days before and within the same year as the distribution date if application of such setoff right against an earlier obligation would not be permitted under Code Section 409A. (x) 409A Rules Do Not Constitute Waiver of Other Restrictions. The rules applicable to 409A Awards under this Section 1(a) constitute further restrictions on terms of Awards set forth elsewhere in this Plan. (b) Separate Payments. Unless otherwise specified in the applicable Award agreement, each vesting tranche of an Award shall be deemed to be a separate payment for purposes of Code Section 409A, and any portion of a vesting tranche that would vest on a pro rata basis in the event of a separation from service for the period from the date of separation in a given fiscal year to December 31 of that year and the portion that would vest pro rata for the period from the beginning of a calendar year to the end of the Company’s fiscal year, and any remaining portion of such vesting tranche that would not so vest, each shall be deemed to be a separate payment for purposes of Code Section 409A. (c) Distributions Upon Vesting. In the case of any Non-409A Award providing for a distribution upon the lapse of a substantial risk of forfeiture, if the timing of such distribution is not otherwise specified in the Plan or an Award agreement or other governing document, the distribution shall be made not later than the 15th day of the third month after the end of the fiscal year in which the substantial risk of forfeiture lapsed, and if a determination is to be made promptly

-24- 4861-2267-0144.2 following the end of a performance year (as in the case of performance shares) then the determination of the level of achievement of performance and the distribution shall be made between the start of the subsequent fiscal year and the 15th day of the third month of such subsequent fiscal year. In all cases, the Participant shall have no influence (aside from any deferral election permitted under Section 409A) on any determination as to the tax year in which the distribution will be made. (d) Limitation on Adjustments. Any adjustment under the Plan shall be implemented in a way that complies with applicable requirements under Section 409A so that Non-409A Awards do not, due to the adjustment, become 409A Awards, and otherwise so that no adverse consequences under Section 409A result to Participants. (e) Release or Other Termination Agreement. If the Company requires a Participant to execute a release, non-competition, or other agreement as a condition to receipt of a payment upon or following a termination of employment, the Company will supply to the Participant a form of such release or other document not later than the date of the Participant’s termination of employment (if not date for such action otherwise is specified in documents relating thereto), which must be returned within the minimum time period required by law (or 21 days if no minimum period is so prescribed) and must not be revoked by the Participant within the applicable time period for revocation (if any) in order for the Participant to satisfy any such condition. If any amount constituting a deferral of compensation under Section 409A payable during a fixed period following termination of employment is subject to such a requirement and the fixed period would begin in one Participant tax year and end in the next tax year, the Company, in determining the time of payment of any such amount, will not be influenced by the timing of any action of the Participant including execution of such a release or other document and expiration of any revocation period. In such cases, the Company will pay any such amount in the subsequent tax year within the fixed period. (f) Special Disability Provision. Unless otherwise provided in an applicable Award agreement or other governing document, in case of a disability of a Participant, (i) for any Award or portion thereof that constitutes a short-term deferral for purposes of Section 409A, the Company shall determine whether the Participant’s circumstances are such that the Participant will not return to service, in which case such disability will be treated as a termination of employment for purposes of determining the time of payment of such Award or portion thereof then subject only to service-based vesting, and (ii) for any Award or portion thereof that constitutes a 409A Award, the Company shall determine whether there has occurred a “separation from service” as defined under Treasury Regulation § 1.409A-1(h) based on Participant’s circumstances, in which case such disability will be treated as a separation from service for purposes of determining the time of payment of such Award or portion thereof then subject only to service-based vesting. In each case, the Participant shall be accorded the benefit of vesting that would result in the case of disability in the absence of this provision, so that the operation of this provision, intended to comply with Section 409A, will not disadvantage the Participant. The Company’s determinations hereunder will be made within 30 days after the disability arises or there occurs a material change in the Participant’s condition that constitutes the disability. In the case of any short-term deferral, if (i) circumstances arise constituting a disability but not constituting a termination of employment, (ii) the Award would provide for vesting upon a termination due to disability, and (iii) the Award would not qualify as a short-term deferral if the Participant were then permitted to elect the time

-25- 4861-2267-0144.2 at which to terminate employment due to the disability, then only the Company will be entitled to act to terminate Participant’s employment due to disability. (g) Limit on Authority to Amend. The authority to adopt amendments under Section 10(e) does not include authority to take action by amendment that would have the effect of causing Awards to fail to meet applicable requirements of Section 409A. (h) Scope and Application of this Provision. For purposes of the Plan and this Appendix, references to a term or event (including any authority or right of the Company or a Participant) being “permitted” under Section 409A mean that the term or event will not cause the Participant to be deemed to be in constructive receipt of compensation relating to the Award prior to the distribution of cash, shares or other property (and the lapse of any applicable substantial risk of forfeiture) or to be liable for payment of interest or a tax penalty under Section 409A. 2. Deferral Election Rules. If a participant in the Plan or any other plan, program or other compensatory arrangement (a “plan”) of the Company is permitted to elect to defer awards or other compensation, any such election relating to compensation deferred under the applicable plan must be received by the Company prior to the date specified by or at the direction of the administrator of such plan (the “Administrator,” which in most instances will be the head of Human Resources for the Company). If the deferral constitutes a deferral of compensation for purposes of Code Section 409A, any such election to defer shall be subject to the rules set forth below, subject to any additional restrictions as may be specified by the Administrator. Under no circumstances may a Participant elect to defer compensation to which he or she has attained, at the time of deferral, a legally enforceable right to current receipt of such compensation. (a) Initial Deferral Elections. Any initial election to defer compensation (including the election as to the type and amount of compensation to be deferred and the time and manner of settlement of the deferral) must be made (and shall be irrevocable) no later than December 31 of the year before the participant’s services are performed that will result in the earning of the compensation, except for initial deferral elections otherwise permitted under Treasury Regulation § 1.409A-2(a). (b) Further Deferral Elections. In the case of any election to further defer an amount that is deemed to be a deferral of compensation subject to Code Section 409A (to the extent permitted under Company plans, programs and arrangements), such further deferral election shall comply with Treasury Regulation§ 1.409A-2(b).

-26- 4861-2267-0144.2 Appendix B Kontoor Brands, Inc. 1996 Stock Compensation Plan (A VF Corporation Plan Assumed by Kontoor Brands, Inc. Relating to Kontoor Employee Awards) May 22, 2019 Kontoor Brands, Inc. (“Kontoor”) has assumed certain rights and obligations of VF Corporation (“VF”) with regards to equity awards that were outstanding under VF’s 1996 Stock Compensation Plan (the “VF Plan”) at May 22, 2019, the date of consummation of VF’s spinoff transaction by which Kontoor became separated from VF (the “Spinoff’). This document constitutes an amendment to the VF 1996 Stock Compensation Plan insofar as it relates to such rights and obligations assumed by Kontoor. As used herein, the term “Plan” refers to the Plan as assumed by Kontoor and amended hereby, while “VF Plan” refers to the VF 1996 Stock Compensation Plan as in effect prior to the Spinoff. Effective at the time of the Spinoff, Kontoor assumed rights and obligations under the VF Plan relating to equity awards held by persons who, immediately after the Spinoff, continued as employees of Kontoor and its subsidiaries. However, for clarity, Kontoor did not assume rights and obligations relating to equity awards held by persons (i) who immediately after the Spinoff continued as employees of VF and its post-Spinoff subsidiaries, (ii) who had, prior to the Spinoff, ceased to be employees or directors of VF and its then subsidiaries (including Kontoor), and (iii) whose equity awards under the VF Plan resulted from service as non-employee directors of VF, Kontoor or other VF subsidiaries. (1) Name of Plan: Kontoor Brands, Inc. 1996 Stock Compensation Plan (a VF Corporation Plan Assumed by Kontoor Brands, Inc. Relating to Kontoor Employee Awards). (2) References in Plan: The following specifies the meaning of certain references in Plan provisions. However, in all cases, if the context otherwise requires, the provision will be interpreted so as to preserve the substantive rights of all parties (Kontoor, VF and participants) to the fullest extent possible. (a) References to “VF Corporation,” “VF” or the “Company” refer to Kontoor, except that, in the case of Plan-related events prior to the Spinoff, such references are to VF. Kontoor constituted a subsidiary of VF prior to the Spinoff. (b) Accordingly, definitions of “Directors” in Plan Section 2.10 and “Employees” in Plan Section 2.12 mean Directors of Kontoor and Employees of Kontoor and its subsidiaries, except references to events relating to such a person prior to the Spinoff include events occurring at a time the person was serving as a Director or Employee of VF or its subsidiaries.

-27- 4861-2267-0144.2 (c) References to the “Committee” are to the Kontoor Talent and Compensation Committee (and any successor committee) at times from and after the Spinoff, and to the VF Talent and Compensation Committee (and any predecessor committee) at times prior to the Spinoff. (3) Other Affected Plan Provisions: (a) Articles III - IX and related provisions: Kontoor has no authority to make new grants under the Plan, other than the replacement of awards outstanding at the time of the Spinoff through the assumption and conversion of those awards. However, Kontoor retains full authority to modify outstanding awards under the Plan. (b) Section 3.1: A total of 2,514,253 shares of Kontoor Common Stock are reserved under the Plan, representing only the shares subject to equity awards outstanding at the time of the Spinoff that have been assumed by Kontoor and converted into equity awards relating to Kontoor Common Stock, together with such number of additional shares deliverable in connection with dividend equivalent rights under such Plan awards. For clarity, such number of shares represents one share reserved and available for each share subject to an assumed and converted Stock Option or Full- Value Award. (Note: The counting of Full-Value Awards as three shares against the Plan reserve under Plan Section 3.1 is discontinued, because no new equity awards will be granted under the Plan; shares will be recaptured from Plan Awards based on provisions of the 2019 Stock Award and Incentive Plan on a one-share-for-one-share basis). (c) Section 5.3: Annual award limits are adjusted to 4,851,125 shares of Kontoor Common Stock for Stock Options (previously under the VF Plan this limit was 2 million Stock Options) and 1,940,451 shares of Kontoor Common Stock for Full-Value Awards (previously under the VF Plan this limit was 800,000 Restricted Awards). (d) Section 2.4 (Definition of “Change in Control”): The Spinoff and events relating thereto do not constitute a Change in Control for purposes of any award assumed under the Plan. Only events relating to Kontoor from and after the Spinoff potentially will give rise to a Change in Control. (e) Section 2.24 (Definition of “Retirement”): Service with VF and its subsidiaries other than Kontoor prior to the Spinoff will be treated as service with a predecessor company. Attachment: The VF 1996 Stock Compensation Plan, as amended and restated and in effect at the date of the Spinoff

EX-10.43

KONTOOR BRANDS, INC. AWARD CERTIFICATE Performance-Based Restricted Stock Units (“PRSUs”) for Fiscal Years [20__]- [20__] (the “Performance Cycle”) under the 2019 Stock Compensation Plan Target PRSUs Awarded: __________ To: ________________ (the “Participant”) I am pleased to advise you that you have been awarded the opportunity to earn from 0% to [200%] of the number of Performance-Based Restricted Stock Units set forth above under the 2019 Stock Compensation Plan (the “Plan”) of Kontoor Brands, Inc. (the “Company”) for the Performance Cycle commencing at the beginning of fiscal [20__] and ending on the final day of fiscal [20__] under the terms and conditions set forth in the attached Appendix. The actual number of shares of the Company’s Stock, if any, that you may receive at the end of the Performance Cycle will depend, among other things as described in the Appendix, on the level of achievement over the Performance Cycle of specified performance goals set by the Talent and Compensation Committee of the Company’s Board of Directors. KONTOOR BRANDS, INC. Grant Date: __________ By: [Name] [Title] Exhibit 10.43

Page 2 KONTOOR BRANDS, INC. APPENDIX TO PRSUs AWARD CERTIFICATE Terms and Conditions Relating to Performance-Based Restricted Stock Units (“PRSUs”) 1. Opportunity to Earn PRSUs. The Participant has been designated as having the opportunity to earn Performance-Based Restricted Stock Units (“PRSUs”) under the Kontoor Brands, Inc. (the “Company”) 2019 Stock Compensation Plan, as it may be amended (the “Plan”), for the three-fiscal-year Performance Cycle specified in the Award Certificate (the “Performance Cycle”). Subject to the terms and conditions of the Plan and this Agreement, the Participant will have the opportunity to earn from 0% to [200%] of the targeted number of PRSUs (the “Target PRSUs”) for the Performance Cycle. The number of Target PRSUs shall be the number set forth on the Award Certificate plus additional cash or PRSUs resulting from Dividend Equivalents and adjustments, as specified in Section 3(c). 2. Incorporation of Plan by Reference; Certain Restrictions. (a) PRSUs that may be earned by the Participant represent Stock Units under the Plan, a copy of which has been made available to Participant. All of the terms, conditions, and other provisions of the Plan are hereby incorporated by reference into this document. Except as otherwise provided herein, capitalized terms used in this document but not defined herein shall have the same meanings as in the Plan. If there is any conflict between the provisions of this document and the provisions of the Plan, the provisions of the Plan shall govern. (b) Until PRSUs have become earned in accordance with Section 4, PRSUs shall be subject to a risk of forfeiture as provided in this document. Until such time as the PRSUs have become settled by delivery of shares in accordance with Section 6, PRSUs will be nontransferable, as provided in the Plan and Section 3(d). The Participant is subject to the Company’s Code of Business Conduct and related policies on insider trading restricting the Participant’s ability to sell shares of the Company’s Common Stock received in settlement of PRSUs, which may include “blackout” periods during which Participant may not engage in such sales. 3. General Terms of PRSUs. (a) Each PRSU represents a conditional right of the Participant to receive, and a conditional obligation of the Company to deliver, one share of the Company’s Common Stock, at the times specified hereunder and subject to the terms and conditions of the Plan and this document. (b) Not later than the March 15 immediately following the end of the Performance Cycle (the “Settlement Deadline”), the Committee will make a final determination of the extent to which the performance goals for that Performance Cycle were achieved and the number of PRSUs earned for that Performance Cycle in accordance with Section 4. The date on which the Committee makes such final determination is the “Determination Date.”

Page 3 (c) An account (an “Account”) will be maintained for the Participant for purposes of this Agreement and the Plan, to which the initial number of Target PRSUs for each Performance Cycle initially shall be credited. Unless otherwise determined by the Administrator (as defined herein) (subject to Section 12.1 of the Plan), dividend equivalents (“Dividend Equivalents”) will be paid or credited on PRSUs that have been earned as follows: (i) At the time of settlement of PRSUs under Section 6, the Administrator shall determine the aggregate amount of regular cash dividends that would have been payable to the Participant, based on record dates for dividends since the beginning of the Performance Cycle (or, if later, the date on which the Participant has been selected to participate in the Performance Cycle and has had a target and range and performance goal(s) established for PRSUs (the “Participation Date”)), if the earned PRSUs then to be settled had been outstanding shares of Common Stock at such record date (without compounding of dividends but adjusted to account for splits and other extraordinary corporate transactions). Such aggregate cash amount will be withheld to cover withholding taxes applicable at the settlement date, with any amount in excess of such tax withholding amount converted to a number of shares (or deferred shares, if applicable) by dividing such excess amount by the Fair Market Value of a share of Common Stock at the settlement date. "Administrator" means the officers and employees of the Company responsible for the day-to-day administration of the Plan and to which other authority may be delegated under Section 4.2 of the Plan. Unless otherwise specified by the Committee, the Administrator shall be the Kontoor Brands, Inc. Pension Plan Committee. (ii) If the Company declares and pays a dividend or distribution on Common Stock in the form of additional shares of Common Stock, or there occurs a forward split of Common Stock, then the number of PRSUs credited to the Participant's Account and potentially earnable hereunder as of the payment date for such dividend or distribution or forward split shall be automatically adjusted by multiplying the number of PRSUs credited to the Account or potentially earnable as of the record date for such dividend or distribution or split by the number of additional shares of Common Stock actually paid as a dividend or distribution or issued in such split in respect of each outstanding share of Common Stock. (iii) If the Company declares and pays a dividend or distribution on Common Stock that is not a regular cash dividend and not in the form of additional shares of Common Stock, or if there occurs any other event referred to in Article XI of the Plan, the Committee may determine to adjust the number of PRSUs credited to the Participant's Account and potentially earnable hereunder (including provision for the earning of property or other forms of compensation than Common Stock), in order to prevent dilution or enlargement of the Participants' rights with respect to PRSUs. (iv) PRSUs and other rights to compensation that result from a stock dividend or split under Section 3(c)(ii) or an adjustment under Section 3(c)(iii) shall be subject to the same vesting terms (including earning based on achievement of the Performance Goal) and risk of forfeiture as applied to the related PRSUs originally granted. The Committee may vary the manner and terms of crediting Dividend Equivalents during or following the end of the Performance Cycle, for administrative convenience or any other reason, provided that the Committee determines that any alternative manner and terms result in equitable treatment of Participant and subject to the provisions of Section 3(c). The number of Target PRSUs and the terms of PRSUs will be subject to adjustment upon the occurrence of certain extraordinary corporate events specified in Section 3(c) and otherwise in accordance with Section 4(a), such adjustments to be made by the Committee in order to prevent dilution or enlargement of Participant’s opportunity to earn incentive

Page 4 compensation under this Agreement. Thus, the percentage of Target PRSUs earned under Section 4 will include the additional cash or PRSUs resulting from the crediting of Dividend Equivalents. (d) Unless otherwise determined by the Committee, neither the Participant nor any beneficiary shall have the right to, directly or indirectly, alienate, assign, transfer, pledge, anticipate or encumber (except by reason of death) any PRSU, Account or Account balance, or other right hereunder, nor shall any such PRSU, Account or Account balance or other right be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment by creditors of the Participant or any beneficiary, or to the debts, contracts, liabilities, engagements or torts of the Participant or any beneficiary or transfer by operation of law in the event of bankruptcy or insolvency of the Participant or any beneficiary, or any legal process.. 4. Earning of PRSUs. (a) PRSUs for the Performance Cycle will be earned as follows: The Performance Goal set forth herein must be achieved at the levels specified by the Committee in order for PRSUs to be earned for the Performance Cycle. Performance shall be based on the Company’s ability to achieve the [annual] growth targets for [Adjusted Earnings Per Share and Revenue] [Insert Performance Goals] performance goals, as defined and interpreted by the Committee, by the end of the Performance Cycle, and further subject to the Committee’s discretion to impose a modifier such as total shareholder return and/or to impose or modify performance terms and condition(s)). The Committee also may provide for adjustments to the Performance Goal, the Performance Cycle and other terms of Awards to reflect changes in accounting rules, corporate structure or other circumstances of the Company, for the purpose of preventing dilution or enlargement of the Participants’ opportunity to earn PRSUs hereunder, and subject to Section 12.15 of the Plan. The Committee may adjust upward or downward the number of PRSUs earned, in its discretion (subject to Section 12.15 of the Plan), in light of such considerations as the Committee may deem relevant, but in accordance with a standard that the number of earned PRSUs shall correlate to the performance achieved by the efforts of management (including the Participant) as intended at the time of setting of the Performance Goal. To determine the number of PRSUs earned, the growth targets achieved will be averaged together. For this purpose, the designation of target performance, the achievement of which is required for the earning of the Target PRSUs, and threshold and maximum performance and the corresponding number of PRSUs deemed earned (with the maximum level of performance corresponding to the earning of [200%] of the target number of PRSUs), have been (or will be) specified by the Committee for the fiscal years in the Performance Cycle. Performance and the percentage of Target PRSUs earned will be interpolated, if the performance achieved is between threshold and target or between target and maximum. The Committee retains complete discretion in setting the financial goals and related terms that are incorporated into this Performance Goal. (b) At the Determination Date, at which time the Committee will have determined whether and the extent to which the Performance Goals designated by the Committee in accordance with this Section 4 have been achieved and made other determinations authorized hereunder, any PRSUs that are determined to have not been earned shall cease to be earnable and shall be immediately and automatically forfeited and cancelled.

Page 5 5. Effect of Termination of Employment. (a) Forfeiture of PRSUs. Upon Participant’s Termination of Employment (as defined below) prior to the end of the Performance Cycle, the Participant’s unearned PRSUs relating to the Performance Cycle shall cease to be earnable and shall be immediately and automatically forfeited and cancelled, except to the extent otherwise provided herein. “Termination of Employment” means the Participant's termination of employment with the Company or any of its Subsidiaries or affiliates in circumstances in which, immediately thereafter, the Participant is not employed by the Company or any of its Subsidiaries or affiliates; provided, however, that in the case of any PRSUs that constitute a deferral of compensation for purposes of Code Section 409A, Termination of Employment shall mean a "separation from service" as defined in Treasury Regulation § l.409A- l(h). The date of Termination of Employment will be determined without giving effect to any period during which severance payments may be made to the Participant, unless otherwise specifically provided herein. (b) Exceptions. Notwithstanding the provisions of Section 5(a) herein, the following provisions shall apply in the event of Participant’s Retirement, Early Retirement, death, Disability (as defined herein), involuntary separation by the Company not for Cause (as defined herein) or, at or after a Change in Control, voluntary resignation for Good Reason prior to the end of the Performance Cycle: (i) Retirement. In the event of Participant’s Termination of Employment due to Retirement (as defined herein), the Participant shall be entitled to receive settlement of the total number of PRSUs actually earned for the Performance Cycle, determined in accordance with Section 3(b) as if the Participant had continued employment throughout the Performance Cycle; provided that PRSUs that have not been held for the minimum vesting period under Section 6.2 of the Plan will not be earnable and will be cancelled as of the date of Termination of Employment. “Retirement” shall mean a Termination of Employment when the aggregate of Participant’s age plus years of service equals at least 65, provided that, unless the Committee determines otherwise, (A) in no event shall a Termination of Employment be deemed a Retirement unless Participant at the date of his or her Termination of Employment is at least age 55 and has at least two years of service; and (B) a Termination of Employment shall not be deemed a Retirement unless the Participant provides at least six (6) months’ written notice of his or her intent to retire to the Company prior to his or her date of Termination of Employment in form acceptable to the Committee. Any deferral election filed by the Participant in accordance with such procedures as were established by the Company shall be effective and apply to the time of settlement of the PRSUs. (ii) Early Retirement. In the event of Participant’s Termination of Employment due to Early Retirement (as defined herein), the Participant shall be entitled to receive settlement of a Pro Rata Portion (as defined herein) of the total number of PRSUs that would have been actually earned for the Performance Cycle in accordance with Section 3(b), assuming for this purpose that Participant had continued employment throughout the Performance Cycle. The proration date shall be date of Participant’s Termination of Employment. For the purposes herein, “Early Retirement” shall mean a Termination of Employment when the aggregate of the Participant’s age plus years of service equals at least 62, provided that, unless the Committee determines otherwise, (A) in no event shall a Termination of Employment be deemed an Early Retirement unless the Participant at the date of his or her Termination of Employment is at least age 55 and has at least two years of service; and (B) a Termination of Employment shall not be deemed an Early Retirement unless the Participant provides at least six (6) months’ written notice of his or her intent to retire to the Company prior to his or her date of Termination of Employment in form acceptable to the Committee. "Pro Rata Portion" means a portion of a specified number of

Page 6 PRSUs earned in the Performance Cycle assuming continued employment throughout the Performance Cycle, such portion determined by multiplying such number of earned PRSUs by a fraction, the numerator of which is the number of calendar days from the beginning of the Performance Cycle until the applicable proration date and the denominator of which is the number of calendar days in the Performance Cycle. The settlement of PRSUs for any such Performance Cycle shall occur promptly (and in any event not later than the Settlement Deadline) following completion of that Performance Cycle. Any deferral election filed by Participant shall be effective and apply at the time of settlement of the PRSUs. (iii) Death or Disability. If Termination of Employment is due to the Participant's death or Disability, the Participant shall be entitled to receive settlement of the total number of PRSU s the Participant actually earned for the Performance Cycle in accordance with Section 3(b) as if the Participant had continued employment throughout the Performance Cycle. “Disability” means (A), if the Participant has an employment agreement or similar agreement with the Company or any Subsidiary (an “Employment Agreement”) defining "Disability," the definition under such Employment Agreement, or (B) if the Participant has no Employment Agreement defining "Disability," the Participant's incapacity due to physical or mental illness resulting in the Participant's absence from his or her duties with the Company on a full-time basis for 26 consecutive weeks, and, within 30 days after written notice of termination has been given by the Company, the Participant has not returned to the full-time performance of his or her duties. Any deferral election filed by the Participant shall have no effect on the time of settlement of the PRSUs. (iv) Involuntary Termination By the Company Not for Cause Prior to a Change in Control. If Termination of Employment is an involuntary separation by the Company not for Cause prior to a Change in Control, the Participant shall be entitled to receive settlement of a Pro Rata Portion of the total number of PRSUs that would have been actually earned for the Performance Cycle in accordance with Section 3(b), assuming for this purpose that the Participant had continued in employment throughout the Performance Cycle. “Cause” means (A), if the Participant has an Employment Agreement defining "Cause," the definition under such Employment Agreement, or (B) if the Participant has no Employment Agreement defining "Cause," the Participant's gross misconduct, meaning (1) the Participant's willful and continued refusal substantially to perform his or her duties with the Company (other than any such refusal resulting from his or her incapacity due to physical or mental illness), after a demand for substantial performance is delivered to the Participant by the Board that specifically identifies the manner in which the Board believes that the Participant has refused to perform his or her duties, or (2) the willful engaging by the Participant in misconduct materially and demonstrably injurious to the Company. For purposes of this definition, no act or failure to act on the Participant's part shall be considered "willful" unless done, or omitted to be done, by the Participant not in good faith and without reasonable belief that his or her action or omission was in the best interest of the Company. For this purpose, the proration date (used to calculate the Pro Rata Portion) shall be the earlier of (x) the last day of the payroll period with respect to which a severance payment in the nature of salary continuation will be made and (y) the last day of the Performance Cycle. If no severance payments are to be made, the applicable proration date shall be the date of Termination of Employment. The foregoing notwithstanding, PRSUs that have not been held for the minimum vesting period under Section 6.2 of the Plan will not be earnable and will be canceled as of the date of Termination of Employment. The settlement of PRSUs shall occur promptly (and in any event not later than the Settlement Deadline) following completion of the applicable Performance Cycle. Any deferral election filed by the Participant shall have no effect on the time of settlement of the PRSUs.

Page 7 (v) At or Following a Change in Control, Involuntary Termination By the Company Not for Cause or by Participant for Good Reason. If Termination of Employment occurs at or after a Change in Control and is an involuntary separation by the Company not for Cause or a resignation by the Participant for Good Reason, the Participant shall be entitled to receive settlement of the total number of PRSUs the Participant is deemed to have earned in accordance with this Section 5(b)(v), promptly (and in any event within 30 days) following the date of Termination of Employment (subject to the final paragraph of this Section 5(b)). The amount of the settlement shall assume that the Participant has remained with the Company through the completion of the Performance Cycle and that the performance achieved by the Company with respect to the applicable Performance Goal(s) for the Performance Cycle is the average of the performance achieved for the completed year(s) in the Performance Cycle if greater than 100% (i.e., the performance required to earn at least the Target PRSUs), or, if such average is less than 100%, the performance achieved shall be deemed to be the average of the actual performance for the completed year(s) in such Performance Cycle (if any) together with performance for years not yet complete being deemed to be 100% of target performance. Any deferral election filed by the Participant shall have no effect on the time of settlement of the PRSUs. The foregoing provisions notwithstanding, in the case of any PRSUs that constitute a deferral of compensation for purposes of Code Section 409A: (i) if such PRSUs would be settled at a date related to a Termination of Employment (other than due to death) under this Section 5 or in connection with a permitted elective deferral of the PRSUs, such settlement date would be within six months after the Termination of Employment, and the Participant is a "Specified Employee" at the date of Termination of Employment under Code Section 409A, then the settlement date will be delayed until the date six months after Termination of Employment; (ii) if a fiscal year ends in December, any settlement required to follow such fiscal year end shall occur only on or after January l; and (iii) if a Change in Control occurs but in connection therewith no event has occurred that constitutes a change in the ownership of the Company, a change in effective control of the Company, or a change in the ownership of a substantial portion of the assets of the Company (as defined in Treasury Regulation § l.409A-3(i)(5)), then the time of settlement under Section 5(b)(v) shall not be as specified therein but shall instead be at the applicable time under Section 5(b)(iv) (for clarity, the amount of PRSUs earned nevertheless will be determined under Section 5(b)(v)). It is intended that PRSUs that are not electively deferred hereunder constitute short-term deferrals under Treasury Regulation§ l.409A-l(b)(4) to the maximum extent possible, unless otherwise specifically designated by the Company. (c) Termination at or After End of Performance Cycle. Upon the Participant's Termination of Employment at or after the end of the Performance Cycle, all PRSUs resulting from the Performance Cycle shall be settled in accordance with Section 6 as promptly as practicable after the Determination Date, except that, if the Participant has timely filed an irrevocable election to defer settlement of PRSUs following a Termination of Employment due to Retirement or Early Retirement, such PRSUs shall be settled in accordance with such deferral election. (d) Release. Any settlement of PRSU s following Termination of Employment may be delayed by the Committee if the Participant's Employment Agreement or any policy of the Committee then in effect conditions such settlement or severance payments upon the Company receiving a full and valid release of claims against the Company. In such case, the Company shall supply the form of release to the Participant by the date of Termination of Employment, and Participant must sign the release and not revoke it by such date as may be specified by the Company but in no event later than 52 days after Termination of Employment. If such 52-day period would begin in one calendar year and end in the next, then settlement shall only occur in the latter calendar year.

Page 8 6. Settlement of PRSUs. (a) Settlement If PRSUs Not Deferred. Not later than the Settlement Deadline following the end of the Performance Cycle, the Committee shall settle all PRSUs earned in respect of the Performance Cycle, other than PRSU s deferred under Section 6(b) or settled as specified in Section 5, by issuing and/or delivering to the Participant one share of Common Stock for each PRSU being settled. Such issuance or delivery shall occur as promptly as practicable after the Determination Date for the Performance Cycle. (b) Deferral of PRSUs. If and to the extent authorized by the Committee, at any time on or before such date as may be specified by the Administrator in compliance with Code Section 409A, the Participant may elect to defer settlement of PRSUs to a specified date (i) later than the Determination Date for the Performance Cycle to which the PRSUs relate or (ii) later than Termination of Employment due to Retirement, as specified by the Participant; provided, however, that an optional deferral shall be subject to such additional restrictions and limitations as the Committee or Administrator may from time to time specify, including for purposes of ensuring that the Participant will not be deemed to have constructively received compensation in connection with such deferral. Unless otherwise specified by the Committee not later than the Participation Date, dividend equivalents shall accrue on deferred PRSUs and shall be paid in cash annually to the Participant at an annual payment date set by the Administrator, without interest or compounding. (c) Creation of Rabbi Trust. If and to the extent authorized by the Committee, the Company may create one or more trusts and deposit therein Common Stock or other property for delivery to the Participant in satisfaction of the Company's obligations hereunder. Any such trust shall be a "rabbi" trust that shall not jeopardize the status of the Participant's rights hereunder as "unfunded" deferred compensation for federal income tax purposes. (d) Settlement of PRSUs at the End of the Deferral Period. Not later than 15 days after the end of any elective period of deferral or immediately in the case of a deferral period ending immediately prior to a Change in Control, the Company will settle all PRSUs then credited to the Participant's Account by issuing and/or delivering to the Participant one share of Common Stock for each PRSU being settled. Any deferral period will end on an accelerated basis immediately prior to a Change in Control, except as limited under the final paragraph of Section 5(b) and Section 6(b). (e) Manner of Settlement. The Committee or Administrator may, in its or his or her sole discretion, determine the manner in which shares of Common Stock shall be delivered by the Company, including the manner in which fractional shares shall be dealt with; provided, however, that no certificate shall be issued representing a fractional share. In furtherance of this authority, PRSUs may be settled by the Company issuing and delivering the requisite number of shares of Common Stock to a member firm of the New York Stock Exchange that is also a member of the National Association of Securities Dealers, as selected by the Company from time to time, which shares shall be deposited by such member firm in a separate brokerage account for the Participant. If there occurs any delay between the settlement date and the date shares are issued or delivered to the Participant, a cash amount equal to any dividends or distributions the record date for which fell between the settlement date and the date of issuance or delivery of the shares shall be paid to the Participant together with the delivery of the shares. (f) Settlement of PRSUs Held by Non-US Residents. Other provisions of the Plan and this Plan (including Section 6(e) above) notwithstanding, PRSUs credited to the Account of the Participant, if the Participant resides in or is subject to income tax laws of a country other than the United States, may be settled in cash, in the discretion of the Committee. The cash amount payable in settlement of each PRSU

Page 9 shall equal the Fair Market Value of a share at the date of not more than five business days before the date of settlement. The Committee is authorized to vary the terms of participation of such foreign Participant in any other respect (including in ways not consistent with the express provisions of the Plan) in order to conform to the laws, regulations and business customs of a foreign jurisdiction. (g) Certificates. Whenever Common Stock is to be delivered hereunder, the Company shall deliver to the Participant or the Participant’s beneficiary one or more certificates representing the shares of Common Stock, registered in the name of the Participant, the beneficiary, or in such other form of registration as instructed by the Participant, except that the Committee may provide for alternative methods of delivery for administrative convenience. The obligation of the Company to deliver Common Stock hereunder is conditioned upon compliance by the Participant and by the Company with all applicable Federal and state securities and other laws and regulations. 7. Tax Withholding. Participant shall be responsible for payment of any federal, state, foreign or local taxes of any amount required to be paid with respect to the grant or settlement of the PRSUs and any Dividend Equivalents or otherwise in connection with the PRSUs. Unless otherwise determined by the Committee, the Company will withhold from cash payable as Dividend Equivalents and from the shares deliverable in settlement of PRSUs cash plus the number of shares having an aggregate Fair Market Value the sum of which shall equal applicable governmental tax withholding requirements, but with share withholding rounded to the nearest whole share. 8. Binding Effect; Integration; Amendment. The terms and conditions set forth in this document shall be binding upon the heirs, executors, administrators and successors of the parties. The Award Certificate, this document, and the Plan constitute the entire agreement between the parties with respect to the PRSUs and supersede any prior agreements or documents with respect thereto. No amendment, alteration, suspension, discontinuation or termination of this document that may impose any additional obligation upon the Company or materially adversely affect the rights of the Participant with respect to the PRSUs shall be valid unless in each instance such amendment, alteration, suspension, discontinuation or termination is expressed in a written instrument duly executed in the name and on behalf of the Company and, if the Participant’s rights are materially adversely affected thereby, by the Participant. 9. PRSUs subject to Forfeiture Policy for Equity and Incentive Awards. The PRSUs subject to this Award Certificate are subject to the Company’s Forfeiture Policy for Equity and Incentive Awards or other forfeiture or recoupment policies or arrangements, each as in effect from time to time and as applicable to the Participant. Such policies or arrangements impose conditions that may result in forfeiture of such PRSUs or the proceeds to the Participant resulting from such PRSUs (a so-called “clawback”) in certain circumstances if the Company’s financial statements are required to be restated as a result of misconduct or upon the occurrence of other events as described in such policies or arrangements. 10. Miscellaneous. (a) No Promise of Continued Employment. The PRSUs and the granting thereof shall not constitute or be evidence of any agreement or understanding, express or implied, that the Participant has a right to continue as an employee or service provider of the Company for any period of time, or at any particular rate of compensation.

Page 10 (b) Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws (but not the law of conflicts of laws) of the State of North Carolina and applicable federal law. (c) Unfunded Obligations. The grant of the PRSUs and any provision for distribution in settlement of the Participant’s Account hereunder shall be by means of bookkeeping entries on the books of the Company and shall not create in the Participant any right to, or claim against any, specific assets of the Company, nor result in the creation of any trust or escrow account for Participant. With respect to the Participant’s entitlement to any distribution hereunder, the Participant shall be a general creditor of the Company. (d) Notices. Any notice to be given the Company under this Agreement shall be addressed to the Company at its principal executive offices, in care of the Vice President–Human Resources, and any notice to the Participant shall be addressed to the Participant at the Participant’s address as then appearing in the records of the Company. (e) Shareholder Rights. The Participant and any beneficiary shall not have any rights with respect to shares (including voting rights) covered by this Agreement prior to the settlement and distribution of the shares as specified herein.

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 15 U.S.C. SECTION 10A, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott H. Baxter, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Kontoor Brands, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2023	/s/ Scott H. Baxter
	Scott H. Baxter
	President, Chief Executive Officer and Chair of the Board

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 15 U.S.C. SECTION 10A, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Rustin Welton, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Kontoor Brands, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2023	/s/ Rustin Welton
	Rustin Welton
	Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Kontoor Brands, Inc. (the “Company”) on Form 10-Q for the period ending April 1, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Scott H. Baxter, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 4, 2023	/s/ Scott H. Baxter
	Scott H. Baxter
	President, Chief Executive Officer and Chair of the Board

EX-32.2

Exhibit 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Kontoor Brands, Inc. (the “Company”) on Form 10-Q for the period ending April 1, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Rustin Welton, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 4, 2023	/s/ Rustin Welton
	Rustin Welton
	Executive Vice President and Chief Financial Officer

XML

Cover - shares	3 Months Ended
	Apr. 01, 2023	Apr. 28, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 01, 2023
Entity Transition Report	false
Entity File Number	001-38854
Entity Registrant Name	KONTOOR BRANDS, INC.
Entity Incorporation, State or Country Code	NC
Entity Tax Identification Number	83-2680248
Entity Address, Address Line One	400 N. Elm Street
Entity Address, City or Town	Greensboro
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27401
City Area Code	336
Local Phone Number	332-3400
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	KTB
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		56,078,513
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001760965
Current Fiscal Year End Date	--12-31

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Current assets
Cash and cash equivalents	$ 52,677	$ 59,179	$ 193,630
Accounts receivable, net	224,024	225,858	276,037
Inventories	660,089	596,836	432,891
Prepaid expenses and other current assets	102,757	100,396	82,495
Total current assets	1,039,547	982,269	985,053
Property, plant and equipment, net	104,999	104,465	101,380
Operating lease assets	55,116	51,029	47,759
Intangible assets, net	13,173	13,361	14,248
Goodwill	209,904	209,627	211,504
Other assets	220,831	221,510	229,110
TOTAL ASSETS	1,643,570	1,582,261	1,589,054
Current liabilities
Short-term borrowings	7,255	7,280	239
Current portion of long-term debt	12,500	10,000	2,500
Accounts payable	163,871	206,262	266,974
Accrued liabilities	197,203	196,989	198,777
Operating lease liabilities, current	21,241	19,898	22,563
Total current liabilities	402,070	440,429	491,053
Operating lease liabilities, noncurrent	32,472	31,506	26,511
Other liabilities	81,796	76,950	98,257
Long-term debt	827,944	782,619	789,143
Commitments and contingencies
Total liabilities	1,344,282	1,331,504	1,404,964
Equity
Preferred Stock, no par value; shares authorized, 90,000,000; no shares outstanding at March 2023, December 2022 and March 2022	0	0	0
Common Stock, no par value; shares authorized, 600,000,000; shares outstanding of 55,933,661 at March 2023; 55,516,872 at December 2022 and 56,276,243 at March 2022	0	0	0
Additional paid-in capital	251,108	243,696	224,721
Retained earnings	116,185	86,726	43,066
Accumulated other comprehensive loss	(68,005)	(79,665)	(83,697)
Total equity	299,288	250,757	184,090
TOTAL LIABILITIES AND EQUITY	$ 1,643,570	$ 1,582,261	$ 1,589,054

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Statement of Financial Position [Abstract]
Preferred stock, no par value (in USD per share)	$ 0	$ 0	$ 0
Preferred stock, shares authorized (in shares)	90,000,000	90,000,000	90,000,000
Preferred stock, shares outstanding (in shares)	0	0	0
Common stock, no par value (in USD per share)	$ 0	$ 0	$ 0
Common stock, shares authorized (in shares)	600,000,000	600,000,000	600,000,000
Common stock, shares outstanding (in shares)	55,933,661	55,516,872	56,276,243

XML

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Income Statement [Abstract]
Net revenues	$ 667,123	$ 679,743
Costs and operating expenses
Cost of goods sold	380,422	375,122
Selling, general and administrative expenses	191,752	196,400
Total costs and operating expenses	572,174	571,522
Operating income	94,949	108,221
Interest expense	(10,273)	(8,023)
Interest income	419	469
Other expense, net	(2,226)	(222)
Income before income taxes	82,869	100,445
Income taxes	16,573	19,635
Net income	$ 66,296	$ 80,810
Earnings per common share
Basic (in USD per share)	$ 1.19	$ 1.43
Diluted (in USD per share)	$ 1.16	$ 1.40
Weighted average shares outstanding
Basic (in shares)	55,646	56,321
Diluted (in shares)	56,940	57,836

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 66,296	$ 80,810
Other comprehensive income
Net change in foreign currency translation	8,323	(3,615)
Net change in defined benefit pension plans	(35)	6
Net change in derivative financial instruments	3,372	12,668
Total other comprehensive income, net of related taxes	11,660	9,059
Comprehensive income	$ 77,956	$ 89,869

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
OPERATING ACTIVITIES
Net income	$ 66,296	$ 80,810
Adjustments to reconcile net income to cash (used) provided by operating activities:
Depreciation and amortization	9,127	9,862
Stock-based compensation	1,002	5,730
Provision for doubtful accounts	1,877	1,757
Other	2,642	3,422
Changes in operating assets and liabilities:
Accounts receivable	2,851	9,990
Inventories	(59,903)	(70,183)
Accounts payable	(42,965)	54,109
Income taxes	12,237	12,201
Accrued liabilities	(11,259)	(34,642)
Other assets and liabilities	5,473	1,777
Cash (used) provided by operating activities	(12,622)	74,833
INVESTING ACTIVITIES
Property, plant and equipment expenditures	(6,463)	(2,885)
Capitalized computer software	(5,483)	(2,112)
Other	149	(31)
Cash used by investing activities	(11,797)	(5,028)
FINANCING ACTIVITIES
Borrowings under revolving credit facility	178,000	0
Repayments under revolving credit facility	(128,000)	0
Repayments of term loan	(2,500)	0
Repurchases of Common Stock	0	(22,513)
Dividends paid	(26,808)	(26,033)
Shares withheld for taxes, net of proceeds from issuance of Common Stock	(3,619)	(11,102)
Other	(57)	(298)
Cash provided (used) by financing activities	17,016	(59,946)
Effect of foreign currency rate changes on cash and cash equivalents	901	(1,551)
Net change in cash and cash equivalents	(6,502)	8,308
Cash and cash equivalents – beginning of period	59,179	185,322
Cash and cash equivalents – end of period	$ 52,677	$ 193,630

XML

Consolidated Statements of Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss
Balance, beginning (in shares) at Jan. 01, 2022		56,381,000
Balance, beginning at Jan. 01, 2022	$ 148,138	$ 0	$ 218,259	$ 22,635	$ (92,756)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	80,810			80,810
Stock-based compensation, net (in shares)		387,000
Stock-based compensation, net	(5,371)		6,462	(11,833)
Other comprehensive income (loss)	9,059				9,059
Dividends on Common Stock	(26,033)			(26,033)
Repurchase of common stock (in shares)		(492,000)
Repurchases of Common Stock	$ (22,513)			(22,513)
Balance, ending (in shares) at Apr. 02, 2022	56,276,243	56,276,000
Balance, ending at Apr. 02, 2022	$ 184,090	$ 0	224,721	43,066	(83,697)
Balance, beginning (in shares) at Dec. 31, 2022	55,516,872	55,517,000
Balance, beginning at Dec. 31, 2022	$ 250,757	$ 0	243,696	86,726	(79,665)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	66,296			66,296
Stock-based compensation, net (in shares)		417,000
Stock-based compensation, net	(2,617)		7,412	(10,029)
Other comprehensive income (loss)	11,660				11,660
Dividends on Common Stock	$ (26,808)			(26,808)
Balance, ending (in shares) at Apr. 01, 2023	55,933,661	55,934,000
Balance, ending at Apr. 01, 2023	$ 299,288	$ 0	$ 251,108	$ 116,185	$ (68,005)

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Consolidated Statements of Equity (Parenthetical) - $ / shares	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Statement of Stockholders' Equity [Abstract]
Dividends on Common Stock (in USD per share)	$ 0.48	$ 0.46

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BASIS OF PRESENTATION

3 Months Ended

Apr. 01, 2023

Accounting Policies [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

Description of Business

Kontoor Brands, Inc. ("Kontoor," the "Company," "we," "us" or "our") is a global lifestyle apparel company headquartered in the United States ("U.S."). The Company designs, produces, procures, markets, distributes and licenses apparel, footwear and accessories, primarily under the brand names Wrangler® and Lee®. The Company's products are sold in the U.S. through mass merchants, specialty stores, mid-tier and traditional department stores, company-operated stores and online. The Company's products are also sold internationally, primarily in the Europe and Asia-Pacific regions, through department, specialty, company-operated, concession retail and independently-operated partnership stores and online.

Fiscal Year

The Company operates and reports using a 52/53-week fiscal year ending on the Saturday closest to December 31 of each year. Accordingly, this Form 10-Q presents the first quarter of the Company's fiscal year ending December 30, 2023 ("fiscal 2023"), which is a 52-week fiscal year. For presentation purposes herein, all references to periods ended March 2023, December 2022 and March 2022 correspond to the fiscal periods ended April 1, 2023, December 31, 2022 and April 2, 2022, respectively.

Macroeconomic Environment and Other Recent Developments

Macroeconomic conditions, including inflation, rising interest rates, recessionary concerns, fluctuating foreign currency exchange rates and distress in global credit and banking markets, as well as ongoing global supply chain disruptions, labor challenges and the COVID-19 pandemic, continue to adversely impact global economic conditions, as well as the Company's operations. Additionally, the conflict between Russia and Ukraine continues to cause disruption in the surrounding areas and greater uncertainty in the global economy. The Company considered the impact of these developments on the assumptions and estimates used when preparing these quarterly financial statements including, but not limited to, our allowance for doubtful accounts, inventory valuations, liabilities for variable consideration, deferred tax valuation allowances, fair value measurements including asset impairment evaluations, the effectiveness of the Company’s hedging instruments and expected compliance with all applicable financial covenants in our Credit Agreement (as defined in Note 7 to the Company's financial statements). These assumptions and estimates may change as new events occur and additional information is obtained regarding the impact of the above conditions. Such future changes may have an adverse impact on the Company's results of operations, financial position and liquidity.

Basis of Presentation - Interim Financial Statements

The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and do not include all of the information and notes required by generally accepted accounting principles in the U.S. ("GAAP") for complete financial statements. In the opinion of management, the accompanying financial statements contain all normal and recurring adjustments necessary to fairly state the financial position, results of operations and cash flows of the Company for the interim periods presented. Operating results for the three months ended March 2023 are not necessarily indicative of results that may be expected for any other interim period or for fiscal 2023. The unaudited financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the Securities and Exchange Commission on March 1, 2023 ("2022 Annual Report on Form 10-K").

Recently Adopted Accounting Standards

In September 2022, the Financial Accounting Standards Board issued Accounting Standards Update 2022-04, "Disclosure of Supplier Finance Program Obligations," which requires entities that use supplier finance programs in connection with the purchase of goods and services to disclose key terms of the programs, outstanding confirmed amounts as of period end, a description of where those obligations are presented in the balance sheet and an annual rollforward of obligations. This guidance was adopted by the Company during the first quarter of 2023, except for the requirement to include a rollforward of obligations which is effective beginning in 2024 with early adoption permitted. Refer to Note 6 to the Company's financial statements for additional information related to supplier finance program obligations.

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REVENUES

3 Months Ended

Apr. 01, 2023

Revenue from Contract with Customer [Abstract]

REVENUES

REVENUES

Disaggregation of Revenue

The following tables present revenues disaggregated by channel and geography. Revenues from licensing arrangements are included within the U.S. or Non-U.S. Wholesale channels, based on the respective region where the licensee sells the product. Direct-to-Consumer revenues include sales at company-operated Wrangler® and Lee® branded full-price and outlet stores, digital sales at www.wrangler.com and www.lee.com and sales from international concession arrangements.

Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

	Three Months Ended March 2023
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	337,676	$	135,299	$	3,228	$	476,203
Non-U.S. Wholesale	51,919		66,005		10		117,934
Direct-to-Consumer	33,552		39,345		89		72,986
Total	$	423,147	$	240,649	$	3,327	$	667,123
Geographic revenues
U.S.	$	365,129	$	149,690	$	3,317	$	518,136
International	58,018		90,959		10		148,987
Total	$	423,147	$	240,649	$	3,327	$	667,123

	Three Months Ended March 2022
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	330,652	$	136,806	$	2,527	$	469,985
Non-U.S. Wholesale	52,819		91,051		501		144,371
Direct-to-Consumer	28,952		36,363		72		65,387
Total	$	412,423	$	264,220	$	3,100	$	679,743
Geographic revenues
U.S.	$	354,393	$	150,116	$	2,599	$	507,108
International	58,030		114,104		501		172,635
Total	$	412,423	$	264,220	$	3,100	$	679,743

Contract Balances and Performance Obligations

The following table presents information about contract balances recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Accounts receivable, net	$	224,024	$	225,858	$	276,037
Contract assets (a)	5,317		5,050		4,311
Contract liabilities (b)	1,392		1,057		1,787

(a) Included within "prepaid expenses and other current assets" in the Company's balance sheets.

(b) Included within "accrued liabilities" in the Company's balance sheets.

For the three months ended March 2023 and March 2022, revenue recognized that was included in contract liabilities as of December 2022 and December 2021, respectively, was not significant.

As of March 2023, the Company has contractual rights under its licensing agreements to receive $52.2 million of fixed consideration related to the future minimum guarantees through December 2028. As of March 2023, there were no arrangements with any

transaction price allocated to remaining performance obligations other than (i) contracts for which the Company has applied the practical expedients and (ii) fixed consideration related to future minimum guarantees. For the three months ended March 2023, revenue recognized from performance obligations satisfied, or partially satisfied, in prior periods was not significant. The variable consideration under these arrangements is not disclosed as a remaining performance obligation as the licensing arrangements qualify for the sales-based royalty exemption.

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BUSINESS SEGMENT INFORMATION

3 Months Ended

Apr. 01, 2023

Segment Reporting [Abstract]

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

The Company has two reportable segments:

•Wrangler — Wrangler® branded denim, apparel, footwear and accessories.

•Lee — Lee® branded denim, apparel, footwear and accessories.

The Company considers its chief executive officer to be its chief operating decision maker. The chief operating decision maker allocates resources and assesses performance based on the global brand operating results of Wrangler® and Lee®, which are the Company's operating and reportable segments.

In addition, we report an "Other" category to reconcile segment revenues and segment profit to the Company's operating results, but the Other category does not meet the criteria to be considered a reportable segment. Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

Accounting policies utilized for internal management reporting at the individual segments are consistent with those disclosed in the Company's 2022 Annual Report on Form 10-K. Corporate and other expenses and interest income and expense are not controlled by segment management and therefore are excluded from the measurement of segment profit.

The following table presents financial information for the Company's reportable segments and income before income taxes:

	Three Months Ended March
(In thousands)		2023		2022
Segment revenues:
Wrangler		$	423,147	$	412,423
Lee		240,649		264,220
Total reportable segment revenues		663,796		676,643
Other revenues		3,327		3,100
Total net revenues		$	667,123	$	679,743
Segment profit:
Wrangler		$	71,107	$	75,388
Lee		39,573		52,230
Total reportable segment profit		$	110,680	$	127,618
Corporate and other expenses		(18,064)		(19,982)
Interest expense		(10,273)		(8,023)
Interest income		419		469
Profit related to other revenues		107		363
Income before income taxes		$	82,869	$	100,445

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ACCOUNTS RECEIVABLE

3 Months Ended

Apr. 01, 2023

Receivables [Abstract]

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE

Allowance for Doubtful Accounts

The following table presents a rollforward of the allowance for doubtful accounts:

	Three Months Ended March
(In thousands)		2023		2022
Balance, December		$	9,918	$	11,705
Provisions for expected credit losses		1,877		1,757
Accounts receivable balances written off		(560)		(153)
Other (1)		233		(284)
Balance, March		$	11,468	$	13,025

(1) Other primarily includes the impact of foreign currency translation and recoveries of amounts previously written off, none of which were individually significant.

Sale of Trade Accounts Receivable

The Company is party to an agreement with a financial institution to sell selected trade accounts receivable on a nonrecourse basis. Under this agreement, up to $377.5 million of the Company’s trade accounts receivable may be sold to the financial institution and remain outstanding at any point in time. The Company removes the sold balances from "accounts receivable, net" in its balance sheet at the time of sale. The Company does not retain any interests in the sold trade accounts receivable but continues to service and collect outstanding trade accounts receivable on behalf of the financial institution.

During the three months ended March 2023 and March 2022, the Company sold total trade accounts receivable of $359.7 million and $355.5 million, respectively. As of March 2023, December 2022 and March 2022, $256.3 million, $246.0 million and $227.0 million, respectively, of the sold trade accounts receivable had been removed from the Company's balance sheets but remained outstanding with the financial institution.

The funding fees charged by the financial institution for this program are reflected in the Company's statements of operations within "other expense, net" and were $3.0 million and $0.6 million for the three months ended March 2023 and March 2022, respectively. Net proceeds of this program are reflected as operating activities in the Company's statements of cash flows.

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INVENTORIES

3 Months Ended

Apr. 01, 2023

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

The following table presents components of "inventories" recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Finished products	$	577,143	$	509,554	$	346,160
Work-in-process	32,857		34,316		40,310
Raw materials	50,089		52,966		46,421
Total inventories	$	660,089	$	596,836	$	432,891

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Supply Chain Financing	3 Months Ended
	Apr. 01, 2023
Supply Chain Financing [Abstract]
Supply Chain Financing	SUPPLY CHAIN FINANCINGThe Company facilitates a voluntary Supply Chain Finance ("SCF") program with its financial institutions that allows certain suppliers the option to sell or assign their rights to receivables due from the Company, enabling the suppliers to receive payment from the financial institutions sooner than our negotiated payment terms. Participation in the SCF program is based on terms and conditions negotiated directly between the suppliers and the financial institutions. The Company agrees to commercial terms with suppliers independent of their participation in the SCF program, and thus their participation has no impact on our payment terms. The Company is not a party to the agreements between our suppliers and the financial institutions, and has no economic interest in our suppliers' decision to participate in the SCF program. For suppliers who participate in the SCF program, they have sole discretion to determine which invoices, if any, are to be sold to the financial institutions. All amounts payable to suppliers who participate in the SCF program are included within "accounts payable" in the Company's balance sheets, and the Company's associated payments to the suppliers are included in operating activities in the Company's statements of cash flows. At March 2023, December 2022 and March 2022, accounts payable included total outstanding balances of $23.9 million, $24.7 million and $16.7 million, respectively, due to suppliers that participate in the SCF program.

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT

3 Months Ended

Apr. 01, 2023

Debt Disclosure [Abstract]

SHORT-TERM BORROWINGS AND LONG-TERM DEBT

SHORT-TERM BORROWINGS AND LONG-TERM DEBT

Short-term Borrowings

At March 2023, December 2022 and March 2022, the Company had $24.9 million, $24.8 million and $10.0 million, respectively, of international lines of credit with various banks, which are uncommitted and may be terminated at any time by either the Company or the banks. There was a total outstanding balance of $7.1 million under these arrangements at both March 2023 and December 2022, and no outstanding balance at March 2022. In addition, short-term borrowings included other debt of $0.2 million at March 2023, December 2022 and March 2022.

Long-term Debt

The following table presents the components of "long-term debt" as recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Revolving Credit Facility	$	50,000	$	—	$	—
Term Loan A	395,586		397,954		397,559
4.125% Notes, due 2029	394,858		394,665		394,084
Total long-term debt	840,444		792,619		791,643
Less: current portion	(12,500)		(10,000)		(2,500)
Long-term debt, due beyond one year	$	827,944	$	782,619	$	789,143

Credit Facilities

On November 18, 2021, the Company completed a refinancing pursuant to which it issued $400.0 million of Notes (as defined below) and amended and restated its senior secured Credit Agreement (the “Credit Agreement”). The Credit Agreement provides for (i) a five-year $400.0 million term loan A facility (“Term Loan A”), with quarterly mandatory repayments which commenced in March 2023 and (ii) a five-year $500.0 million revolving credit facility (the “Revolving Credit Facility”) (collectively, the “Credit Facilities”) with the lenders and agents party thereto.

Term Loan A had an outstanding principal amount of $397.5 million at March 2023, and $400.0 million at both December 2022 and March 2022, which is reported net of unamortized deferred financing costs. As of March 2023, interest expense on Term Loan A was being recorded at an effective annual interest rate of 4.3%, including the amortization of deferred financing costs and the impact of the Company’s interest rate swap.

The Revolving Credit Facility may be used to borrow funds in both U.S. dollar and certain non-U.S. dollar currencies, and has a $75.0 million letter of credit sublimit. As of March 2023, the Company had $50.0 million of outstanding borrowings under the Revolving Credit Facility and $11.7 million of outstanding standby letters of credit issued on behalf of the Company, leaving $438.3 million available for borrowing against this facility.

The interest rate per annum applicable to the Credit Agreement is an interest rate benchmark elected by the Company based on the currency and term of the borrowing plus an applicable margin, as defined therein.

The Credit Agreement contains certain affirmative and negative covenants customary for financings of this type as well as customary events of default. In addition, the Credit Agreement contains financial covenants which require compliance with (i) a total leverage ratio not to exceed 4.50 to 1.00 as of the last day of any test period, with an allowance for up to two elections to increase the limit to

5.00 to 1.00 in connection with certain material acquisitions, and (ii) a consolidated interest coverage ratio as of the last day of any test period to be no less than 3.00 to 1.00. As of March 2023, the Company was in compliance with all covenants and expects to maintain compliance with the applicable covenants for at least one year from the issuance of these financial statements.

Senior Notes

On November 18, 2021, the Company entered into an indenture (the “Indenture”) by and among the Company and certain subsidiaries of the Company named as guarantors therein (the “Guarantors”), pursuant to which it issued $400.0 million of unsecured senior notes due November 2029 (the “Notes”) through a private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended. The Notes bear interest at a fixed rate of 4.125% per annum, payable in cash in arrears on May 15 and November 15 of each year.

The Notes had an outstanding principal amount of $400.0 million at March 2023, December 2022 and March 2022, which is reported net of unamortized deferred financing costs. As of March 2023, interest expense on the Notes was being recorded at an effective annual interest rate of 4.3%, including the amortization of deferred financing costs.

The Notes are guaranteed on a senior unsecured basis by the Company’s existing and future domestic subsidiaries (other than certain excluded subsidiaries) that are borrowers under or guarantors of the Credit Facilities or certain other indebtedness. The Indenture governing the Notes contains customary negative covenants for financings of this type. The Indenture does not contain any financial covenants. As of March 2023, the Company was in compliance with the Indenture and expects to maintain compliance with the applicable covenants for at least one year from the issuance of these financial statements.

Refer to Note 10 in the Company's 2022 Annual Report on Form 10-K for additional information regarding the Company’s debt obligations.

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FAIR VALUE MEASUREMENTS

3 Months Ended

Apr. 01, 2023

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Certain assets and liabilities measured and reported at fair value are classified in a three-level hierarchy that prioritizes the inputs used in the valuation process. Categorization within the valuation hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The hierarchy is based on the observability and objectivity of the pricing inputs, as follows:

•Level 1 — Quoted prices in active markets for identical assets or liabilities.

•Level 2 — Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable data through corroboration with observable market data. Inputs would normally be (i) quoted prices in active markets for similar assets or liabilities, (ii) quoted prices in inactive markets for identical or similar assets or liabilities or (iii) information derived from or corroborated by observable market data.

•Level 3 — Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be the Company's own data and judgments about assumptions that market participants would use in pricing the asset or liability.

Recurring Fair Value Measurements

The following tables present financial assets and financial liabilities that are measured and recorded in the Company's financial statements at fair value on a recurring basis:

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
March 2023
Financial assets:
Cash equivalents:
Money market funds	$	25,798	$	25,798	$	—	$	—
Time deposits	2,079		2,079		—		—
Foreign currency exchange contracts	20,377		—		20,377		—
Interest rate swap agreements	8,946		—		8,946		—
Investment securities	46,641		46,641		—		—
Financial liabilities:
Foreign currency exchange contracts	3,230		—		3,230		—
Deferred compensation	48,539		—		48,539		—

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
December 2022
Financial assets:
Cash equivalents:
Money market funds	$	20,097	$	20,097	$	—	$	—
Time deposits	2,194		2,194		—		—
Foreign currency exchange contracts	15,565		—		15,565		—
Interest rate swap agreements	11,357		—		11,357		—
Investment securities	43,131		43,131		—		—
Financial liabilities:
Foreign currency exchange contracts	2,307		—		2,307		—
Deferred compensation	44,589		—		44,589		—

The Company's cash equivalents include money market funds and short-term time deposits that approximate fair value based on Level 1 measurements. The fair value of derivative financial instruments, which consist of foreign currency exchange contracts and interest rate swap agreements, is determined based on observable market inputs (Level 2), including spot and forward exchange rates for foreign currencies and observable interest rate yield curves for interest rate swap agreements. Investment securities are held in the Company's deferred compensation plans as an economic hedge of the related deferred compensation liabilities and are comprised of mutual funds that are valued based on quoted prices in active markets (Level 1). Liabilities related to the Company's deferred compensation plans are recorded at amounts due to participants, based on the fair value of the participants’ selection of hypothetical investments (Level 2).

Additionally, at March 2023, the carrying value of the Company's long-term debt was $840.4 million compared to a fair value of $785.5 million. At December 2022, the carrying value of the Company's long-term debt was $792.6 million compared to a fair value of $718.0 million. The fair value of long-term debt is a Level 2 estimate based on quoted market prices or values of comparable borrowings.

All other financial assets and financial liabilities are recorded in the Company's financial statements at cost. These other financial assets and financial liabilities include cash held as demand deposits, accounts receivable, short-term borrowings, accounts payable, and accrued liabilities. At March 2023 and December 2022, their carrying values approximated fair value due to the short-term nature of these instruments.

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

3 Months Ended

Apr. 01, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

Summary of Derivative Financial Instruments

The Company enters into derivative contracts with external counterparties to hedge certain foreign currency transactions. The notional amount of all outstanding foreign currency exchange contracts was $321.3 million at March 2023, $322.3 million at December 2022 and $287.5 million at March 2022, consisting primarily of contracts hedging exposures to the euro, Mexican peso, Canadian dollar, British pound, Polish zloty and Swedish krona. Foreign currency exchange contracts have maturities up to 20 months.

During 2019, the Company entered into "floating to fixed" interest rate swap agreements to mitigate exposure to volatility in reference rates on the Company's future interest payments. The notional amount of the interest rate swap agreements was $300.0 million at March 2023, December 2022 and March 2022. Because these interest rate swap agreements meet the criteria for hedge accounting, all related gains and losses are deferred within accumulated other comprehensive loss ("AOCL") and are being amortized through April 18, 2024.

The Company's outstanding derivative financial instruments met the criteria for hedge accounting at the inception of the hedging relationship. At each reporting period, the Company assesses whether the hedging relationships continue to be highly effective in offsetting changes in cash flows of hedged items. If the Company determines that a specific hedging relationship has ceased to be highly effective, it would discontinue hedge accounting. All designated hedging relationships were determined to be highly effective as of March 2023.

The following table presents the fair value of outstanding derivatives on an individual contract basis:

	Fair Value of Derivatives with Unrealized Gains						Fair Value of Derivatives with Unrealized Losses
	March		December		March		March		December		March
(In thousands)	2023		2022		2022		2023		2022		2022
Derivatives designated as hedging instruments:
Foreign currency exchange contracts	$	20,361	$	15,565	$	11,041	$	(2,914)	$	(2,307)	$	(1,073)
Interest rate swap agreements	8,946		11,357		4,309		—		—		—
Derivatives not designated as hedging instruments:
Foreign currency exchange contracts	16		—		131		(316)		—		(2)
Total derivatives	$	29,323	$	26,922	$	15,481	$	(3,230)	$	(2,307)	$	(1,075)

The Company records and presents the fair value of all derivative assets and liabilities in the Company's balance sheets on a gross basis, even though certain derivative contracts are subject to master netting agreements. If the Company were to offset and record the asset and liability balances of its derivative contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Company's balance sheets would be adjusted from the current gross presentation to the net amounts.

The following table presents a reconciliation of gross to net amounts for derivative asset and liability balances:

	March 2023				December 2022				March 2022
(In thousands)	Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability
Gross amounts presented in the balance sheet	$	29,323	$	(3,230)	$	26,922	$	(2,307)	$	15,481	$	(1,075)
Gross amounts not offset in the balance sheet	(1,449)		1,449		(1,629)		1,629		(938)		938
Net amounts	$	27,874	$	(1,781)	$	25,293	$	(678)	$	14,543	$	(137)

The following table presents the location of derivatives in the Company's balance sheets, with current or noncurrent classification based on maturity dates:

(In thousands)	March 2023		December 2022		March 2022
Prepaid expenses and other current assets	$	18,046	$	14,183	$	9,424
Accrued liabilities	(2,683)		(1,218)		(838)
Other assets	11,277		12,739		6,057
Other liabilities	(547)		(1,089)		(237)

Cash Flow Hedges

The following tables present the pre-tax effects of cash flow hedges included in the Company's statements of operations and statements of comprehensive income:

	Gain (Loss) on Derivatives Recognized in AOCL
(In thousands)	Three Months Ended March
Cash Flow Hedging Relationships		2023		2022
Foreign currency exchange contracts		$	10,337	$	7,325
Interest rate swap agreements		(309)		9,095
Total		$	10,028	$	16,420

	Gain (Loss) Reclassified from AOCL into Income
(In thousands)	Three Months Ended March
Location of Gain (Loss)		2023		2022
Net revenues		$	(171)	$	(132)
Cost of goods sold		5,992		2,301
Other expense, net		160		(103)
Interest expense		2,101		(1,266)
Total		$	8,082	$	800

Other Derivative Information

Any contracts that are not designated as hedges are recorded at fair value in the Company's balance sheets. Changes in the fair values of derivative contracts not designated as hedges are recognized directly in earnings. There were no significant amounts recognized in earnings for the ineffective portion of any hedging relationships or changes in the fair values of derivative contracts not designated as hedges during the three months ended March 2023 and March 2022.

At March 2023, AOCL included $28.3 million of pre-tax net deferred gains for foreign currency exchange contracts and interest rate swap agreements that are expected to be reclassified to earnings during the next 12 months. The amounts ultimately reclassified to earnings will depend on rates in effect when outstanding derivative contracts are settled.

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ACCUMULATED OTHER COMPREHENSIVE LOSS

3 Months Ended

Apr. 01, 2023

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE LOSS

ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table presents deferred components of AOCL in equity, net of related taxes:

(In thousands)	March 2023		December 2022		March 2022
Foreign currency translation	$	(99,139)	$	(107,462)	$	(96,740)
Defined benefit pension plans	2,208		2,243		(2,171)
Derivative financial instruments	28,926		25,554		15,214
Accumulated other comprehensive loss	$	(68,005)	$	(79,665)	$	(83,697)

The following tables present changes in AOCL, net of related tax impact:

	Three Months Ended March 2023
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2022	$	(107,462)	$	2,243	$	25,554	$	(79,665)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	8,323		—		10,292		18,615
Reclassifications to net income of previously deferred (gains) losses	—		(35)		(6,920)		(6,955)
Net other comprehensive income (loss)	8,323		(35)		3,372		11,660
Balance, March 2023	$	(99,139)	$	2,208	$	28,926	$	(68,005)

	Three Months Ended March 2022
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2021	$	(93,125)	$	(2,177)	$	2,546	$	(92,756)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	(3,615)		—		13,814		10,199
Reclassifications to net income of previously deferred (gains) losses	—		6		(1,146)		(1,140)
Net other comprehensive income (loss)	(3,615)		6		12,668		9,059
Balance, March 2022	$	(96,740)	$	(2,171)	$	15,214	$	(83,697)

The following table presents reclassifications out of AOCL:

(In thousands)		Three Months Ended March
Details About Accumulated Other Comprehensive Loss Reclassifications	Affected Line Item in the Financial Statements
			2023		2022
Defined benefit pension plans:
Net change in deferred gains (losses) during the period	Selling, general and administrative expenses		$	46	$	(8)
Total before tax			46		(8)
Income taxes	Income taxes		(11)		2
Net of tax			35		(6)
Gains (losses) on derivative financial instruments:
Foreign currency exchange contracts	Net revenues		$	(171)	$	(132)
Foreign currency exchange contracts	Cost of goods sold		5,992		2,301
Foreign currency exchange contracts	Other expense, net		160		(103)
Interest rate swap agreements	Interest expense		2,101		(1,266)
Total before tax			8,082		800
Income taxes	Income taxes		(1,162)		346
Net of tax			6,920		1,146
Total reclassifications for the period, net of tax			$	6,955	$	1,140

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STOCK-BASED COMPENSATION

3 Months Ended

Apr. 01, 2023

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

On April 1, 2023, the Company made its annual grant of equity awards under the Kontoor Brands, Inc. 2019 Stock Compensation Plan, including approximately 230,000 shares of performance-based restricted stock units ("PRSUs”) to employees, approximately 180,000 shares of time-based restricted stock units ("RSUs") to employees, and approximately 20,000 shares of RSUs to nonemployee members of the Board of Directors. The fair market value of Kontoor Common Stock at the date the awards were granted was $48.39 per share and was used to value the RSUs and Director RSUs.

Each PRSU entitles the employee to receive a potential final payout ranging from zero to two shares of Kontoor Common Stock at the end of a three-year performance period. The number of shares earned by participants, if any, is based on achievement of performance goals set by the Talent and Compensation Committee of the Board of Directors. The actual number of shares earned may also be adjusted upward or downward by 25%, subject to a 0% floor, of the target award based on how Kontoor’s total shareholder return (“TSR”) over a three-year period compares to the TSR for companies included in a Company-selected peer group. Shares earned related to the 2023 grants will be issued to participants following the conclusion of the three-year performance period.

Each employee RSU entitles the holder to one share of Kontoor Common Stock and typically vests over a three-year period. Each RSU granted to a nonemployee member of the Board of Directors vests upon grant and will be settled in one share of Kontoor Common Stock one year from the date of grant.

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INCOME TAXES

3 Months Ended

Apr. 01, 2023

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The effective income tax rate for the three months ended March 2023 was 20.0% compared to 19.5% in the 2022 period. The three months ended March 2023 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 0.2%. The three months ended March 2022 included a net discrete tax benefit primarily related to stock-based compensation which decreased the effective income tax rate by 1.1%. The effective tax rate without discrete items for the three months ended March 2023 was 20.2% compared to 20.6% in the 2022 period. The decrease was primarily due to changes in our jurisdictional mix of earnings.

During the three months ended March 2023, the amount of net unrecognized tax benefits and associated interest increased by $0.3 million to $15.3 million. Management believes that it is reasonably possible that the amount of unrecognized tax benefits may decrease by $2.5 million within the next 12 fiscal months due to settlements of audits and expiration of statutes of limitations, all of which would reduce income tax expense.

On April 5, 2023, the Company was granted a tax holiday from local income taxes in a foreign jurisdiction through 2031. The associated tax effects, including approximately $5.5 million of tax expense related to the remeasurement of deferred tax assets in this jurisdiction, will be reflected in the second quarter of 2023.

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EARNINGS PER SHARE

3 Months Ended

Apr. 01, 2023

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

The calculations of basic and diluted earnings per share ("EPS") are based on net income divided by the basic weighted average number of common shares and diluted weighted average number of common shares outstanding, respectively.

The following table presents the calculations of basic and diluted EPS:

	Three Months Ended March
(In thousands, except per share amounts)		2023		2022
Net income		$	66,296	$	80,810
Basic weighted average shares outstanding		55,646		56,321
Dilutive effect of stock-based awards		1,294		1,515
Diluted weighted average shares outstanding		56,940		57,836
Earnings per share:
Basic earnings per common share		$	1.19	$	1.43
Diluted earnings per common share		$	1.16	$	1.40

For the three months ended March 2023 and March 2022, an immaterial number of shares were excluded from the dilutive earnings per share calculations because the effect of their inclusion would have been anti-dilutive.

For the three months ended March 2023, a total of 0.6 million shares of PRSUs were excluded from the calculations of diluted earnings per share as the units were not considered to be contingent outstanding shares. For the three months ended March 2022, an immaterial number of shares of PRSUs were excluded from the calculations of diluted earnings per share as the units were not considered to be contingent outstanding shares.

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LEASES

3 Months Ended

Apr. 01, 2023

Leases [Abstract]

LEASES

LEASES

The Company enters into operating leases for retail stores, operational facilities, vehicles and certain equipment, with terms expiring at various dates through 2033. Most leases have fixed rentals, with many of the real estate leases requiring additional payments for real estate taxes and occupancy-related costs.

The following table presents supplemental cash flow and non-cash information related to operating leases:

	Three Months Ended March
(In thousands)		2023		2022
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows		$	7,639	$	8,418
Right-of-use operating assets obtained in exchange for new operating leases - non-cash activity		$	1,406	$	1,259

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RESTRUCTURING

3 Months Ended

Apr. 01, 2023

Restructuring and Related Activities [Abstract]

RESTRUCTURING

RESTRUCTURING

The Company generally incurs restructuring charges related to cost optimization of business activities, primarily related to severance and employee-related benefits. No restructuring charges were recognized during the three months ended March 2023 and March 2022.

All of the $4.5 million restructuring accrual reported in the Company's balance sheet at March 2023 is expected to be paid out within the next 12 months and was classified within "accrued liabilities." All of the $10.7 million restructuring accrual reported in the Company's balance sheet at December 2022 was classified within "accrued liabilities."

The following table presents activity in the restructuring accrual for the three-month period ended March 2023:

(In thousands)	Total
Accrual at December 2022	$	10,695
Cash payments	(6,227)
Adjustments to accruals	(79)
Currency translation	160
Balance, March 2023	$	4,549

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SUBSEQUENT EVENT	3 Months Ended
	Apr. 01, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENT	SUBSEQUENT EVENTOn April 20, 2023, the Board of Directors declared a regular quarterly cash dividend of $0.48 per share of the Company's Common Stock. The cash dividend will be payable on June 20, 2023, to shareholders of record at the close of business on June 9, 2023.

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BASIS OF PRESENTATION (Policies)

3 Months Ended

Apr. 01, 2023

Accounting Policies [Abstract]

Fiscal Year

Fiscal YearThe Company operates and reports using a 52/53-week fiscal year ending on the Saturday closest to December 31 of each year. Accordingly, this Form 10-Q presents the first quarter of the Company's fiscal year ending December 30, 2023 ("fiscal 2023"), which is a 52-week fiscal year. For presentation purposes herein, all references to periods ended March 2023, December 2022 and March 2022 correspond to the fiscal periods ended April 1, 2023, December 31, 2022 and April 2, 2022, respectively.

Basis of Presentation - Interim Financial Statements

Basis of Presentation - Interim Financial Statements

The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and do not include all of the information and notes required by generally accepted accounting principles in the U.S. ("GAAP") for complete financial statements. In the opinion of management, the accompanying financial statements contain all normal and recurring adjustments necessary to fairly state the financial position, results of operations and cash flows of the Company for the interim periods presented. Operating results for the three months ended March 2023 are not necessarily indicative of results that may be expected for any other interim period or for fiscal 2023. The unaudited financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the Securities and Exchange Commission on March 1, 2023 ("2022 Annual Report on Form 10-K").

Recently Adopted Accounting Standards

Recently Adopted Accounting Standards

In September 2022, the Financial Accounting Standards Board issued Accounting Standards Update 2022-04, "Disclosure of Supplier Finance Program Obligations," which requires entities that use supplier finance programs in connection with the purchase of goods and services to disclose key terms of the programs, outstanding confirmed amounts as of period end, a description of where those obligations are presented in the balance sheet and an annual rollforward of obligations. This guidance was adopted by the Company during the first quarter of 2023, except for the requirement to include a rollforward of obligations which is effective beginning in 2024 with early adoption permitted. Refer to Note 6 to the Company's financial statements for additional information related to supplier finance program obligations.

Fair Value Measurements

Certain assets and liabilities measured and reported at fair value are classified in a three-level hierarchy that prioritizes the inputs used in the valuation process. Categorization within the valuation hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The hierarchy is based on the observability and objectivity of the pricing inputs, as follows:

•Level 1 — Quoted prices in active markets for identical assets or liabilities.

•Level 2 — Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable data through corroboration with observable market data. Inputs would normally be (i) quoted prices in active markets for similar assets or liabilities, (ii) quoted prices in inactive markets for identical or similar assets or liabilities or (iii) information derived from or corroborated by observable market data.

•Level 3 — Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be the Company's own data and judgments about assumptions that market participants would use in pricing the asset or liability.

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REVENUES (Tables)

3 Months Ended

Apr. 01, 2023

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following tables present revenues disaggregated by channel and geography. Revenues from licensing arrangements are included within the U.S. or Non-U.S. Wholesale channels, based on the respective region where the licensee sells the product. Direct-to-Consumer revenues include sales at company-operated Wrangler® and Lee® branded full-price and outlet stores, digital sales at www.wrangler.com and www.lee.com and sales from international concession arrangements.

Other includes sales and licensing of Rock & Republic®, other company-owned brands and private label apparel.

	Three Months Ended March 2023
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	337,676	$	135,299	$	3,228	$	476,203
Non-U.S. Wholesale	51,919		66,005		10		117,934
Direct-to-Consumer	33,552		39,345		89		72,986
Total	$	423,147	$	240,649	$	3,327	$	667,123
Geographic revenues
U.S.	$	365,129	$	149,690	$	3,317	$	518,136
International	58,018		90,959		10		148,987
Total	$	423,147	$	240,649	$	3,327	$	667,123

	Three Months Ended March 2022
(In thousands)	Wrangler		Lee		Other		Total
Channel revenues
U.S. Wholesale	$	330,652	$	136,806	$	2,527	$	469,985
Non-U.S. Wholesale	52,819		91,051		501		144,371
Direct-to-Consumer	28,952		36,363		72		65,387
Total	$	412,423	$	264,220	$	3,100	$	679,743
Geographic revenues
U.S.	$	354,393	$	150,116	$	2,599	$	507,108
International	58,030		114,104		501		172,635
Total	$	412,423	$	264,220	$	3,100	$	679,743

Contract Assets and Liabilities

The following table presents information about contract balances recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Accounts receivable, net	$	224,024	$	225,858	$	276,037
Contract assets (a)	5,317		5,050		4,311
Contract liabilities (b)	1,392		1,057		1,787

(a) Included within "prepaid expenses and other current assets" in the Company's balance sheets.

(b) Included within "accrued liabilities" in the Company's balance sheets.

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BUSINESS SEGMENT INFORMATION (Tables)

3 Months Ended

Apr. 01, 2023

Segment Reporting [Abstract]

Financial Information for Reportable Segments

The following table presents financial information for the Company's reportable segments and income before income taxes:

	Three Months Ended March
(In thousands)		2023		2022
Segment revenues:
Wrangler		$	423,147	$	412,423
Lee		240,649		264,220
Total reportable segment revenues		663,796		676,643
Other revenues		3,327		3,100
Total net revenues		$	667,123	$	679,743
Segment profit:
Wrangler		$	71,107	$	75,388
Lee		39,573		52,230
Total reportable segment profit		$	110,680	$	127,618
Corporate and other expenses		(18,064)		(19,982)
Interest expense		(10,273)		(8,023)
Interest income		419		469
Profit related to other revenues		107		363
Income before income taxes		$	82,869	$	100,445

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ACCOUNTS RECEIVABLE (Tables)

3 Months Ended

Apr. 01, 2023

Receivables [Abstract]

Rollforward of the Allowance for Doubtful Accounts

The following table presents a rollforward of the allowance for doubtful accounts:

	Three Months Ended March
(In thousands)		2023		2022
Balance, December		$	9,918	$	11,705
Provisions for expected credit losses		1,877		1,757
Accounts receivable balances written off		(560)		(153)
Other (1)		233		(284)
Balance, March		$	11,468	$	13,025

(1) Other primarily includes the impact of foreign currency translation and recoveries of amounts previously written off, none of which were individually significant.

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INVENTORIES (Tables)

3 Months Ended

Apr. 01, 2023

Inventory Disclosure [Abstract]

Components of Inventories

The following table presents components of "inventories" recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Finished products	$	577,143	$	509,554	$	346,160
Work-in-process	32,857		34,316		40,310
Raw materials	50,089		52,966		46,421
Total inventories	$	660,089	$	596,836	$	432,891

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT (Tables)

3 Months Ended

Apr. 01, 2023

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

The following table presents the components of "long-term debt" as recorded in the Company's balance sheets:

(In thousands)	March 2023		December 2022		March 2022
Revolving Credit Facility	$	50,000	$	—	$	—
Term Loan A	395,586		397,954		397,559
4.125% Notes, due 2029	394,858		394,665		394,084
Total long-term debt	840,444		792,619		791,643
Less: current portion	(12,500)		(10,000)		(2,500)
Long-term debt, due beyond one year	$	827,944	$	782,619	$	789,143

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FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Apr. 01, 2023

Fair Value Disclosures [Abstract]

Classes of Financial Assets and Financial Liabilities Measured and Recorded at Fair Value on Recurring Basis

The following tables present financial assets and financial liabilities that are measured and recorded in the Company's financial statements at fair value on a recurring basis:

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
March 2023
Financial assets:
Cash equivalents:
Money market funds	$	25,798	$	25,798	$	—	$	—
Time deposits	2,079		2,079		—		—
Foreign currency exchange contracts	20,377		—		20,377		—
Interest rate swap agreements	8,946		—		8,946		—
Investment securities	46,641		46,641		—		—
Financial liabilities:
Foreign currency exchange contracts	3,230		—		3,230		—
Deferred compensation	48,539		—		48,539		—

			Fair Value Measurement Using
(In thousands)	Total Fair Value		Level 1		Level 2		Level 3
December 2022
Financial assets:
Cash equivalents:
Money market funds	$	20,097	$	20,097	$	—	$	—
Time deposits	2,194		2,194		—		—
Foreign currency exchange contracts	15,565		—		15,565		—
Interest rate swap agreements	11,357		—		11,357		—
Investment securities	43,131		43,131		—		—
Financial liabilities:
Foreign currency exchange contracts	2,307		—		2,307		—
Deferred compensation	44,589		—		44,589		—

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

3 Months Ended

Apr. 01, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The following table presents the fair value of outstanding derivatives on an individual contract basis:

	Fair Value of Derivatives with Unrealized Gains						Fair Value of Derivatives with Unrealized Losses
	March		December		March		March		December		March
(In thousands)	2023		2022		2022		2023		2022		2022
Derivatives designated as hedging instruments:
Foreign currency exchange contracts	$	20,361	$	15,565	$	11,041	$	(2,914)	$	(2,307)	$	(1,073)
Interest rate swap agreements	8,946		11,357		4,309		—		—		—
Derivatives not designated as hedging instruments:
Foreign currency exchange contracts	16		—		131		(316)		—		(2)
Total derivatives	$	29,323	$	26,922	$	15,481	$	(3,230)	$	(2,307)	$	(1,075)

The following table presents a reconciliation of gross to net amounts for derivative asset and liability balances:

	March 2023				December 2022				March 2022
(In thousands)	Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability
Gross amounts presented in the balance sheet	$	29,323	$	(3,230)	$	26,922	$	(2,307)	$	15,481	$	(1,075)
Gross amounts not offset in the balance sheet	(1,449)		1,449		(1,629)		1,629		(938)		938
Net amounts	$	27,874	$	(1,781)	$	25,293	$	(678)	$	14,543	$	(137)

The following table presents the location of derivatives in the Company's balance sheets, with current or noncurrent classification based on maturity dates:

(In thousands)	March 2023		December 2022		March 2022
Prepaid expenses and other current assets	$	18,046	$	14,183	$	9,424
Accrued liabilities	(2,683)		(1,218)		(838)
Other assets	11,277		12,739		6,057
Other liabilities	(547)		(1,089)		(237)

Pre-Tax Effects of Cash Flow Hedges Included in the Statement of Operations and Statements of Comprehensive Income (Loss)

The following tables present the pre-tax effects of cash flow hedges included in the Company's statements of operations and statements of comprehensive income:

	Gain (Loss) on Derivatives Recognized in AOCL
(In thousands)	Three Months Ended March
Cash Flow Hedging Relationships		2023		2022
Foreign currency exchange contracts		$	10,337	$	7,325
Interest rate swap agreements		(309)		9,095
Total		$	10,028	$	16,420

	Gain (Loss) Reclassified from AOCL into Income
(In thousands)	Three Months Ended March
Location of Gain (Loss)		2023		2022
Net revenues		$	(171)	$	(132)
Cost of goods sold		5,992		2,301
Other expense, net		160		(103)
Interest expense		2,101		(1,266)
Total		$	8,082	$	800

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ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables)

3 Months Ended

Apr. 01, 2023

Equity [Abstract]

Deferred Components of AOCL in Equity, Net of Related Taxes, and Changes in AOCL

The following table presents deferred components of AOCL in equity, net of related taxes:

(In thousands)	March 2023		December 2022		March 2022
Foreign currency translation	$	(99,139)	$	(107,462)	$	(96,740)
Defined benefit pension plans	2,208		2,243		(2,171)
Derivative financial instruments	28,926		25,554		15,214
Accumulated other comprehensive loss	$	(68,005)	$	(79,665)	$	(83,697)

The following tables present changes in AOCL, net of related tax impact:

	Three Months Ended March 2023
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2022	$	(107,462)	$	2,243	$	25,554	$	(79,665)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	8,323		—		10,292		18,615
Reclassifications to net income of previously deferred (gains) losses	—		(35)		(6,920)		(6,955)
Net other comprehensive income (loss)	8,323		(35)		3,372		11,660
Balance, March 2023	$	(99,139)	$	2,208	$	28,926	$	(68,005)

	Three Months Ended March 2022
(In thousands)	Foreign Currency Translation		Defined Benefit Pension Plans		Derivative Financial Instruments		Total
Balance, December 2021	$	(93,125)	$	(2,177)	$	2,546	$	(92,756)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	(3,615)		—		13,814		10,199
Reclassifications to net income of previously deferred (gains) losses	—		6		(1,146)		(1,140)
Net other comprehensive income (loss)	(3,615)		6		12,668		9,059
Balance, March 2022	$	(96,740)	$	(2,171)	$	15,214	$	(83,697)

Reclassification Out of AOCL

The following table presents reclassifications out of AOCL:

(In thousands)		Three Months Ended March
Details About Accumulated Other Comprehensive Loss Reclassifications	Affected Line Item in the Financial Statements
			2023		2022
Defined benefit pension plans:
Net change in deferred gains (losses) during the period	Selling, general and administrative expenses		$	46	$	(8)
Total before tax			46		(8)
Income taxes	Income taxes		(11)		2
Net of tax			35		(6)
Gains (losses) on derivative financial instruments:
Foreign currency exchange contracts	Net revenues		$	(171)	$	(132)
Foreign currency exchange contracts	Cost of goods sold		5,992		2,301
Foreign currency exchange contracts	Other expense, net		160		(103)
Interest rate swap agreements	Interest expense		2,101		(1,266)
Total before tax			8,082		800
Income taxes	Income taxes		(1,162)		346
Net of tax			6,920		1,146
Total reclassifications for the period, net of tax			$	6,955	$	1,140

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EARNINGS PER SHARE (Tables)

3 Months Ended

Apr. 01, 2023

Earnings Per Share [Abstract]

Schedule of Earnings Per Share

The following table presents the calculations of basic and diluted EPS:

	Three Months Ended March
(In thousands, except per share amounts)		2023		2022
Net income		$	66,296	$	80,810
Basic weighted average shares outstanding		55,646		56,321
Dilutive effect of stock-based awards		1,294		1,515
Diluted weighted average shares outstanding		56,940		57,836
Earnings per share:
Basic earnings per common share		$	1.19	$	1.43
Diluted earnings per common share		$	1.16	$	1.40

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LEASES (Tables)

3 Months Ended

Apr. 01, 2023

Leases [Abstract]

Supplemental Cash Flow and Non-Cash Information Related to Operating Leases

The following table presents supplemental cash flow and non-cash information related to operating leases:

	Three Months Ended March
(In thousands)		2023		2022
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows		$	7,639	$	8,418
Right-of-use operating assets obtained in exchange for new operating leases - non-cash activity		$	1,406	$	1,259

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RESTRUCTURING (Tables)

3 Months Ended

Apr. 01, 2023

Restructuring and Related Activities [Abstract]

Activity in Restructuring

The following table presents activity in the restructuring accrual for the three-month period ended March 2023:

(In thousands)	Total
Accrual at December 2022	$	10,695
Cash payments	(6,227)
Adjustments to accruals	(79)
Currency translation	160
Balance, March 2023	$	4,549

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REVENUES - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 667,123	$ 679,743
U.S.
Disaggregation of Revenue [Line Items]
Revenue	518,136	507,108
International
Disaggregation of Revenue [Line Items]
Revenue	148,987	172,635
Wholesale | U.S.
Disaggregation of Revenue [Line Items]
Revenue	476,203	469,985
Wholesale | International
Disaggregation of Revenue [Line Items]
Revenue	117,934	144,371
Direct-to-Consumer
Disaggregation of Revenue [Line Items]
Revenue	72,986	65,387
Operating Segments
Disaggregation of Revenue [Line Items]
Revenue	663,796	676,643
Operating Segments | Wrangler
Disaggregation of Revenue [Line Items]
Revenue	423,147	412,423
Operating Segments | Wrangler | U.S.
Disaggregation of Revenue [Line Items]
Revenue	365,129	354,393
Operating Segments | Wrangler | International
Disaggregation of Revenue [Line Items]
Revenue	58,018	58,030
Operating Segments | Wrangler | Wholesale | U.S.
Disaggregation of Revenue [Line Items]
Revenue	337,676	330,652
Operating Segments | Wrangler | Wholesale | International
Disaggregation of Revenue [Line Items]
Revenue	51,919	52,819
Operating Segments | Wrangler | Direct-to-Consumer
Disaggregation of Revenue [Line Items]
Revenue	33,552	28,952
Operating Segments | Lee
Disaggregation of Revenue [Line Items]
Revenue	240,649	264,220
Operating Segments | Lee | U.S.
Disaggregation of Revenue [Line Items]
Revenue	149,690	150,116
Operating Segments | Lee | International
Disaggregation of Revenue [Line Items]
Revenue	90,959	114,104
Operating Segments | Lee | Wholesale | U.S.
Disaggregation of Revenue [Line Items]
Revenue	135,299	136,806
Operating Segments | Lee | Wholesale | International
Disaggregation of Revenue [Line Items]
Revenue	66,005	91,051
Operating Segments | Lee | Direct-to-Consumer
Disaggregation of Revenue [Line Items]
Revenue	39,345	36,363
Other
Disaggregation of Revenue [Line Items]
Revenue	3,327	3,100
Other | U.S.
Disaggregation of Revenue [Line Items]
Revenue	3,317	2,599
Other | International
Disaggregation of Revenue [Line Items]
Revenue	10	501
Other | Wholesale | U.S.
Disaggregation of Revenue [Line Items]
Revenue	3,228	2,527
Other | Wholesale | International
Disaggregation of Revenue [Line Items]
Revenue	10	501
Other | Direct-to-Consumer
Disaggregation of Revenue [Line Items]
Revenue	$ 89	$ 72

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REVENUES - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 224,024	$ 225,858	$ 276,037
Contract assets	5,317	5,050	4,311
Contract liabilities	$ 1,392	$ 1,057	$ 1,787

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REVENUES - Additional Information (Details) $ in Millions	Apr. 01, 2023 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining performance obligation	$ 52.2

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BUSINESS SEGMENT INFORMATION - Additional Information (Details)	3 Months Ended
	Apr. 01, 2023 segment
Segment Reporting [Abstract]
Number of reportable segments	2

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BUSINESS SEGMENT INFORMATION - Financial Information for Reportable Segments (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Segment Reporting Information [Line Items]
Total net revenues	$ 667,123	$ 679,743
Total reportable segment profit	94,949	108,221
Interest expense	(10,273)	(8,023)
Interest income	419	469
Income before income taxes	82,869	100,445
Operating Segments
Segment Reporting Information [Line Items]
Total net revenues	663,796	676,643
Total reportable segment profit	110,680	127,618
Operating Segments | Wrangler
Segment Reporting Information [Line Items]
Total net revenues	423,147	412,423
Total reportable segment profit	71,107	75,388
Operating Segments | Lee
Segment Reporting Information [Line Items]
Total net revenues	240,649	264,220
Total reportable segment profit	39,573	52,230
Corporate and other expenses
Segment Reporting Information [Line Items]
Corporate and other expenses	(18,064)	(19,982)
Other
Segment Reporting Information [Line Items]
Total net revenues	3,327	3,100
Total reportable segment profit	$ 107	$ 363

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ACCOUNTS RECEIVABLE - Rollforward of the Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 9,918	$ 11,705
Provisions for expected credit losses	1,877	1,757
Accounts receivable balances written off	(560)	(153)
Other	233	(284)
Ending balance	$ 11,468	$ 13,025

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ACCOUNTS RECEIVABLE - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022	Dec. 31, 2022
Receivables [Abstract]
Maximum amount of accounts receivable sold at any point in time (up to)	$ 377.5
Sale of accounts receivable	359.7	$ 355.5
Accounts receivable removed related to sale of accounts receivable	256.3	227.0	$ 246.0
Funding fee	$ 3.0	$ 0.6

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INVENTORIES (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Inventory Disclosure [Abstract]
Finished products	$ 577,143	$ 509,554	$ 346,160
Work-in-process	32,857	34,316	40,310
Raw materials	50,089	52,966	46,421
Total inventories	$ 660,089	$ 596,836	$ 432,891

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Supply Chain Financing (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Supply Chain Financing [Abstract]
Accounts payable, trade	$ 23.9	$ 24.7	$ 16.7

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Short-term Borrowings (Details) - USD ($)	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Short-term Debt [Line Items]
Short-term borrowings	$ 7,255,000	$ 7,280,000	$ 239,000
Other short-term borrowings	200,000	200,000	200,000
International borrowing arrangements
Short-term Debt [Line Items]
Debt capacity	24,900,000	24,800,000	10,000,000
Short-term borrowings	$ 7,100,000	$ 7,100,000	$ 0

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022	Nov. 18, 2021
Debt Instrument [Line Items]
Total long-term debt	$ 840,444	$ 792,619	$ 791,643
Less: current portion	(12,500)	(10,000)	(2,500)
Long-term debt, due beyond one year	827,944	782,619	789,143
Term Loan A | Term Loan
Debt Instrument [Line Items]
Total long-term debt	395,586	397,954	397,559
Revolving Credit Facility
Debt Instrument [Line Items]
Total long-term debt	50,000	0	0
Senior Notes | 4.125% Senior Notes, due 2029
Debt Instrument [Line Items]
Debt instrument, interest rate, stated percentage				4.125%
Total long-term debt	$ 394,858	$ 394,665	$ 394,084

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Credit Facilities (Details)		3 Months Ended
	Nov. 18, 2021 USD ($)	Apr. 01, 2023 USD ($) election	Dec. 31, 2022 USD ($)	Apr. 02, 2022 USD ($)
Debt Instrument [Line Items]
Debt instrument, leverage ratio, number of elections to increase the limit (up to) | election		2
Maximum
Debt Instrument [Line Items]
Leverage ratio		4.50
Debt instrument, leverage ratio, limit increase		5.00
Minimum
Debt Instrument [Line Items]
Debt instrument, interest coverage ratio		3.00
Revolving Credit Facility
Debt Instrument [Line Items]
Debt instrument, term	5 years
Debt capacity	$ 500,000,000
Long-term debt, gross		$ 50,000,000
Remaining borrowing capacity		438,300,000
Letter of Credit
Debt Instrument [Line Items]
Debt capacity		75,000,000
Long-term line of credit		11,700,000
4.125% Senior Notes, due 2029 | Senior Notes
Debt Instrument [Line Items]
Debt instrument, face amount	$ 400,000,000
Long-term debt, gross		$ 400,000,000	$ 400,000,000	$ 400,000,000
Effective annual interest rate		4.30%
Term Loan | Term Loan A
Debt Instrument [Line Items]
Debt instrument, term	5 years
Debt capacity	$ 400,000,000
Long-term debt, gross		$ 397,500,000	$ 400,000,000	$ 400,000,000
Effective annual interest rate		4.30%

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SHORT-TERM BORROWINGS AND LONG-TERM DEBT - Senior Notes (Details) - 4.125% Senior Notes, due 2029 - Senior Notes - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022	Nov. 18, 2021
Debt Instrument [Line Items]
Debt instrument, face amount				$ 400.0
Debt instrument, interest rate, stated percentage				4.125%
Long-term debt, gross	$ 400.0	$ 400.0	$ 400.0
Effective annual interest rate	4.30%

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FAIR VALUE MEASUREMENTS - Classes of Financial Assets and Financial Liabilities Measured and Recorded at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Cash equivalents:
Money market funds	$ 25,798	$ 20,097
Time deposits	2,079	2,194
Foreign currency exchange contracts	29,323	26,922	$ 15,481
Investment securities	46,641	43,131
Financial liabilities:
Foreign currency exchange contracts	3,230	2,307	$ 1,075
Deferred compensation	48,539	44,589
Level 1
Cash equivalents:
Money market funds	25,798	20,097
Time deposits	2,079	2,194
Investment securities	46,641	43,131
Financial liabilities:
Deferred compensation	0	0
Level 2
Cash equivalents:
Money market funds	0	0
Time deposits	0	0
Investment securities	0	0
Financial liabilities:
Deferred compensation	48,539	44,589
Level 3
Cash equivalents:
Money market funds	0	0
Time deposits	0	0
Investment securities	0	0
Financial liabilities:
Deferred compensation	0	0
Foreign currency exchange contracts
Cash equivalents:
Foreign currency exchange contracts	20,377	15,565
Financial liabilities:
Foreign currency exchange contracts	3,230	2,307
Foreign currency exchange contracts | Level 1
Cash equivalents:
Foreign currency exchange contracts	0	0
Financial liabilities:
Foreign currency exchange contracts	0	0
Foreign currency exchange contracts | Level 2
Cash equivalents:
Foreign currency exchange contracts	20,377	15,565
Financial liabilities:
Foreign currency exchange contracts	3,230	2,307
Foreign currency exchange contracts | Level 3
Cash equivalents:
Foreign currency exchange contracts	0	0
Financial liabilities:
Foreign currency exchange contracts	0	0
Interest rate swap agreements
Cash equivalents:
Foreign currency exchange contracts	8,946	11,357
Interest rate swap agreements | Level 1
Cash equivalents:
Foreign currency exchange contracts	0	0
Interest rate swap agreements | Level 2
Cash equivalents:
Foreign currency exchange contracts	8,946	11,357
Interest rate swap agreements | Level 3
Cash equivalents:
Foreign currency exchange contracts	$ 0	$ 0

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FAIR VALUE MEASUREMENTS - Additional Information (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 840,444	$ 792,619	$ 791,643
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt, fair value	$ 785,500	$ 718,000

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Derivative [Line Items]
Cash flow hedge gains to be reclassified during the next 12 months	$ 28.3
Foreign currency exchange contracts
Derivative [Line Items]
Notional amount	$ 321.3	$ 322.3	$ 287.5
Term of contract (up to)	20 months
Interest rate swap agreements
Derivative [Line Items]
Notional amount	$ 300.0	$ 300.0	$ 300.0

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Outstanding Derivatives on an Individual Contract Basis (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Fair Value of Derivatives with Unrealized Gains
Total derivatives	$ 29,323	$ 26,922	$ 15,481
Fair Value of Derivatives with Unrealized Losses
Total derivatives	(3,230)	(2,307)	(1,075)
Designated as Hedging Instrument | Foreign currency exchange contracts
Fair Value of Derivatives with Unrealized Gains
Derivatives designated as hedging instruments:	20,361	15,565	11,041
Fair Value of Derivatives with Unrealized Losses
Derivatives designated as hedging instruments:	(2,914)	(2,307)	(1,073)
Designated as Hedging Instrument | Interest rate swap agreements
Fair Value of Derivatives with Unrealized Gains
Derivatives designated as hedging instruments:	8,946	11,357	4,309
Fair Value of Derivatives with Unrealized Losses
Derivatives designated as hedging instruments:	0	0	0
Not Designated as Hedging Instrument | Foreign currency exchange contracts
Fair Value of Derivatives with Unrealized Gains
Derivatives not designated as hedging instruments:	16	0	131
Fair Value of Derivatives with Unrealized Losses
Derivatives not designated as hedging instruments:	$ (316)	$ 0	$ (2)

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Reconciliation of Gross to Net Amounts for Derivative Asset and Liability Balances (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Derivative Asset
Gross amounts presented in the balance sheet	$ 29,323	$ 26,922	$ 15,481
Gross amounts not offset in the balance sheet	(1,449)	(1,629)	(938)
Derivative Asset	27,874	25,293	14,543
Derivative Liability
Gross amounts presented in the balance sheet	(3,230)	(2,307)	(1,075)
Gross amounts not offset in the balance sheet	1,449	1,629	938
Derivative Liability	$ (1,781)	$ (678)	$ (137)

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Location of Derivative in the Balance Sheets, with Current and Noncurrent Classification (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	$ 29,323	$ 26,922	$ 15,481
Foreign currency exchange contracts	(3,230)	(2,307)	(1,075)
Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	18,046	14,183	9,424
Accrued liabilities
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	(2,683)	(1,218)	(838)
Other assets
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	11,277	12,739	6,057
Other liabilities
Derivatives, Fair Value [Line Items]
Foreign currency exchange contracts	$ (547)	$ (1,089)	$ (237)

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Cash Flow Hedging Relationships (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Derivative [Line Items]
Gain (Loss) on Derivatives Recognized in AOCL	$ 10,028	$ 16,420
Foreign currency exchange contracts
Derivative [Line Items]
Gain (Loss) on Derivatives Recognized in AOCL	10,337	7,325
Interest rate swap agreements
Derivative [Line Items]
Gain (Loss) on Derivatives Recognized in AOCL	$ (309)	$ 9,095

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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Location of Gain (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Derivative [Line Items]
Gain (Loss) Reclassified from AOCL into Income	$ 8,082	$ 800
Net revenues
Derivative [Line Items]
Gain (Loss) Reclassified from AOCL into Income	(171)	(132)
Cost of goods sold
Derivative [Line Items]
Gain (Loss) Reclassified from AOCL into Income	5,992	2,301
Other expense, net
Derivative [Line Items]
Gain (Loss) Reclassified from AOCL into Income	160	(103)
Interest expense
Derivative [Line Items]
Gain (Loss) Reclassified from AOCL into Income	$ 2,101	$ (1,266)

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Additional Information (Details) shares in Thousands	3 Months Ended
	Apr. 02, 2022 shares
Common Stock
Accumulated Other Comprehensive Income (Loss) [Line Items]
Repurchase of common stock (in shares)	492

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Deferred Components of AOCL in Equity, Net of Related Taxes (Details) - USD ($) $ in Thousands	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022	Jan. 01, 2022
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	$ 299,288	$ 250,757	$ 184,090	$ 148,138
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	(68,005)	(79,665)	(83,697)	(92,756)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	(99,139)	(107,462)	(96,740)	(93,125)
Defined benefit pension plans:
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	2,208	2,243	(2,171)	(2,177)
Gains (losses) on derivative financial instruments:
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated other comprehensive loss	$ 28,926	$ 25,554	$ 15,214	$ 2,546

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Changes in AOCL, Net of Related Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning	$ 250,757	$ 148,138
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	18,615	10,199
Reclassifications to net income of previously deferred (gains) losses	(6,955)	(1,140)
Total other comprehensive income, net of related taxes	11,660	9,059
Balance, ending	299,288	184,090
Accumulated Other Comprehensive Loss
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning	(79,665)	(92,756)
Total other comprehensive income, net of related taxes	11,660	9,059
Balance, ending	(68,005)	(83,697)
Foreign Currency Translation
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning	(107,462)	(93,125)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	8,323	(3,615)
Reclassifications to net income of previously deferred (gains) losses	0	0
Total other comprehensive income, net of related taxes	8,323	(3,615)
Balance, ending	(99,139)	(96,740)
Defined benefit pension plans:
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning	2,243	(2,177)
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	0	0
Reclassifications to net income of previously deferred (gains) losses	(35)	6
Total other comprehensive income, net of related taxes	(35)	6
Balance, ending	2,208	(2,171)
Gains (losses) on derivative financial instruments:
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning	25,554	2,546
Other comprehensive income (loss) due to gains (losses) arising before reclassifications	10,292	13,814
Reclassifications to net income of previously deferred (gains) losses	(6,920)	(1,146)
Total other comprehensive income, net of related taxes	3,372	12,668
Balance, ending	$ 28,926	$ 15,214

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Reclassification Out of AOCL (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Selling, general and administrative expenses	$ 191,752	$ 196,400
Net revenues	667,123	679,743
Cost of goods sold	380,422	375,122
Other expense, net	2,226	222
Interest expense	(10,273)	(8,023)
Total before tax	82,869	100,445
Income taxes	(16,573)	(19,635)
Net income	66,296	80,810
Reclassification Out of AOCL
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net income	6,955	1,140
Reclassification Out of AOCL | Defined benefit pension plans:
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Selling, general and administrative expenses	46	(8)
Total before tax	46	(8)
Income taxes	(11)	2
Net income	35	(6)
Reclassification Out of AOCL | Gains (losses) on derivative financial instruments:
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total before tax	8,082	800
Income taxes	(1,162)	346
Net income	6,920	1,146
Reclassification Out of AOCL | Gains (losses) on derivative financial instruments: | Foreign currency exchange contracts
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net revenues	(171)	(132)
Cost of goods sold	5,992	2,301
Other expense, net	160	(103)
Reclassification Out of AOCL | Gains (losses) on derivative financial instruments: | Interest rate swap agreements
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest expense	$ 2,101	$ (1,266)

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STOCK-BASED COMPENSATION (Details)	3 Months Ended
	Apr. 01, 2023 $ / shares shares
Performance-based restricted stock units (PRSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance Period	3 years
Performance-based restricted stock units (PRSUs) | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Actual number of shares adjustment	0.00%
Performance-based restricted stock units (PRSUs) | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Actual number of shares adjustment	25.00%
Performance-based restricted stock units (PRSUs) | Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	230,000
Vesting period	3 years
Performance-based restricted stock units (PRSUs) | Employee | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Payout (in shares)	0
Performance-based restricted stock units (PRSUs) | Employee | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Payout (in shares)	2
Restricted stock units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair market value (in USD per share) | $ / shares	$ 48.39
Restricted stock units (RSUs) | Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	180,000
Payout (in shares)	1
Vesting period	3 years
Restricted stock units (RSUs) | Nonemployee | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	20,000
Payout (in shares)	1
Vesting period	1 year

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INCOME TAXES (Details) - USD ($) $ in Millions		3 Months Ended
	Apr. 05, 2023	Apr. 01, 2023	Apr. 02, 2022
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Effective income tax rate		20.00%	19.50%
Tax increase (reduction) due to discrete items		0.20%	1.10%
Effective income tax rate without discrete items		20.20%	20.60%
Decrease in unrecognized tax benefits and associated interest		$ 0.3
Net unrecognized tax benefits and interest, if recognized, would reduce the annual effective tax rate		15.3
Possible decrease in unrecognized income tax benefits		$ 2.5
Subsequent Event
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]
Tax holiday, amount	$ 5.5

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EARNINGS PER SHARE - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Earnings Per Share [Abstract]
Net income	$ 66,296	$ 80,810
Basic weighted average shares outstanding (in shares)	55,646	56,321
Dilutive effect of stock-based awards (in shares)	1,294	1,515
Diluted weighted average shares outstanding (in shares)	56,940	57,836
Earnings per share:
Basic earnings per common share (in USD per share)	$ 1.19	$ 1.43
Diluted earnings per common share (in USD per share)	$ 1.16	$ 1.40

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EARNINGS PER SHARE - Additional Information (Details) - shares	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock options excluded from computation of earnings per share (in shares)	0	0
Performance-based restricted stock units (PRSUs)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock options excluded from computation of earnings per share (in shares)	600,000	0

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LEASES (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Leases [Abstract]
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows	$ 7,639	$ 8,418
Right-of-use operating assets obtained in exchange for new operating leases - non-cash activity	$ 1,406	$ 1,259

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RESTRUCTURING - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022	Dec. 31, 2022
Restructuring and Related Activities [Abstract]
Charges	$ 0	$ 0
Restructuring reserve	$ 4,549		$ 10,695

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RESTRUCTURING - Activity in Restructuring (Details) $ in Thousands	3 Months Ended
	Apr. 01, 2023 USD ($)
Restructuring Reserve [Roll Forward]
Amounts recorded in accrued liabilities, beginning	$ 10,695
Cash payments	(6,227)
Adjustments to accruals	(79)
Currency translation	160
Amounts recorded in accrued liabilities. ending	$ 4,549

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SUBSEQUENT EVENT (Details)	Apr. 20, 2023 $ / shares
Subsequent Event | Dividend Declared
Subsequent Event [Line Items]
Dividends payable (in USD per share)	$ 0.48