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-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KUQQrxLZ/I3UUyYcrKXDUw1ZFpP0UkBVcWnNnudS9bc2TfqbX2hYZTCsA5CFhIF8 CWoLHy91ZfyIetFNrwW2sQ== 0000950123-10-082831.txt : 20100901 0000950123-10-082831.hdr.sgml : 20100901 20100901060114 ACCESSION NUMBER: 0000950123-10-082831 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20100731 FILED AS OF DATE: 20100901 DATE AS OF CHANGE: 20100901 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BANK JOS A CLOTHIERS INC /DE/ CENTRAL INDEX KEY: 0000920033 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-APPAREL & ACCESSORY STORES [5600] IRS NUMBER: 363189198 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-23874 FILM NUMBER: 101051261 BUSINESS ADDRESS: STREET 1: 500 HANOVER PIKE CITY: HAMPSTEAD STATE: MD ZIP: 21074 BUSINESS PHONE: 4102392700 10-Q 1 c05556e10vq.htm FORM 10-Q Form 10-Q

United States
Securities and Exchange Commission

Washington, DC 20549

FORM 10-Q


þ		Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended July 31, 2010.


o		Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number 0-23874

Jos. A. Bank Clothiers, Inc.

(Exact name of registrant as specified in its charter)


Delaware		36-3189198
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer
		Identification Number)

500 Hanover Pike, Hampstead, MD		21074-2095
(Address of Principal Executive Offices)		(Zip Code)

410-239-2700
(Registrant’s telephone number including area code)

None
(Former name or former address, if changed since last report)

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 o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

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


Large accelerated filer o	Accelerated filer þ	Non-accelerated filer o	Smaller reporting company o
		(Do not check if smaller reporting company)

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:


Class		Outstanding as of August 25, 2010
Common Stock, $.01 par value		27,526,201

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES


	Page No.
Part I. Financial Information

Item 1. Unaudited Condensed Consolidated Financial Statements		3

Condensed Consolidated Statements of Income — Three and Six Months ended August 1, 2009 and July 31, 2010		3

Condensed Consolidated Balance Sheets — as of January 30, 2010 and July 31, 2010		4

Condensed Consolidated Statements of Cash Flows — Three and Six Months ended August 1, 2009 and July 31, 2010		5

Notes to Condensed Consolidated Financial Statements		6

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		14

Item 3. Quantitative and Qualitative Disclosures About Market Risk		22

Item 4. Controls and Procedures		22

Part II. Other Information		23

Item 1. Legal Proceedings		23

Item 1A. Risk Factors		23

Item 5. Other Information		24

Item 6. Exhibits		25

Signature		25

Exhibit Index		26

Exhibit 10.1
Exhibit 10.2
Exhibit 10.3
Exhibit 10.4
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2

PART I. FINANCIAL INFORMATION


Item 1.		Unaudited Condensed Consolidated Financial Statements

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(In Thousands Except Per Share Data)

(Unaudited)


	Three Months Ended						Six Months Ended
	August 1, 2009			July 31, 2010			August 1, 2009			July 31, 2010

Net sales	$	167,735		$	188,412		$	329,660		$	366,537

Cost of goods sold		64,558			70,082			128,029			134,891


Gross profit		103,177			118,330			201,631			231,646


Operating expenses:
Sales and marketing, including occupancy costs		67,684			73,748			132,629			144,267
General and administrative		14,811			17,175			29,471			33,911

Total operating expenses		82,495			90,923			162,100			178,178


Operating income		20,682			27,407			39,531			53,468

Other income (expense):
Interest income		92			159			161			274
Interest expense		(110	)		(5	)		(208	)		(95	)

Total other income (expense)		(18	)		154			(47	)		179


Income before provision for income taxes		20,664			27,561			39,484			53,647
Provision for income taxes		8,152			11,082			15,517			21,360


Net income	$	12,512		$	16,479		$	23,967		$	32,287


Per share information:
Earnings per share:
Basic	$	0.46		$	0.60		$	0.87		$	1.17
Diluted	$	0.45		$	0.59		$	0.86		$	1.16
Weighted average shares outstanding:
Basic		27,437			27,527			27,437			27,527
Diluted		27,781			27,827			27,769			27,823

See accompanying notes.

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In Thousands)


	January 30, 2010		July 31, 2010
	(Audited)		(Unaudited)

ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	21,853	$	89,495
Short-term investments		169,736		114,691
Accounts receivable, net		5,860		8,171
Inventories:
Finished goods		209,443		213,005
Raw materials		8,878		13,040

Total inventories		218,321		226,045
Prepaid expenses and other current assets		16,035		16,590


Total current assets		431,805		454,992

NONCURRENT ASSETS:
Property, plant and equipment, net		124,139		131,089
Other noncurrent assets		420		554

Total assets	$	556,364	$	586,635


LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable	$	18,225	$	32,158
Accrued expenses		85,256		72,644
Deferred tax liability — current		5,064		5,067

Total current liabilities		108,545		109,869

NONCURRENT LIABILITIES:
Deferred rent		51,853		49,535
Deferred tax liability — noncurrent		1,608		247
Other noncurrent liabilities		1,048		1,174

Total liabilities		163,054		160,825


COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ EQUITY:
Common stock		183		274
Additional paid-in capital		83,249		83,462
Retained earnings		309,823		342,019
Accumulated other comprehensive income		55		55

Total stockholders’ equity		393,310		425,810

Total liabilities and stockholders’ equity	$	556,364	$	586,635

See accompanying notes.

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited)


	Six Months Ended
	August 1, 2009			July 31, 2010

Cash flows from operating activities:
Net income	$	23,967		$	32,287
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		10,896			11,802
Loss on disposals of property, plant and equipment		66			91
Non-cash equity compensation		—			234
Increase (decrease) in deferred taxes		225			(1,358	)
Net (increase) in operating working capital and other components		(24,773	)		(17,988	)


Net cash provided by operating activities		10,381			25,068


Cash flows from investing activities:
Capital expenditures		(7,413	)		(12,471	)
Net (purchases) maturities of short-term investments		(64,879	)		55,045


Net cash provided by (used in) investing activities		(72,292	)		42,574


Cash flows from financing activities:		—			—


Net increase (decrease) in cash and cash equivalents		(61,911	)		67,642


Cash and cash equivalents — beginning of period		122,875			21,853


Cash and cash equivalents — end of period	$	60,964		$	89,495

See accompanying notes.

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

BASIS OF PRESENTATION

Jos. A. Bank Clothiers, Inc. (the “Company”) is a nationwide designer, manufacturer, retailer and direct marketer (through stores, catalog and Internet) of men’s tailored and casual clothing and accessories. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the fiscal year. In the opinion of management, the information contained herein reflects all adjustments necessary to make the results of operations for the interim periods a fair statement of the operating results for these periods. These adjustments are of a normal recurring nature.

The Company operates on a 52-53 week fiscal year ending on the Saturday closest to January 31. The following fiscal years ended or will end on the dates indicated and will be referred to herein by their fiscal year designations:


Fiscal year 2005		January 28, 2006
Fiscal year 2006		February 3, 2007
Fiscal year 2007		February 2, 2008
Fiscal year 2008		January 31, 2009
Fiscal year 2009		January 30, 2010
Fiscal year 2010		January 29, 2011

Each fiscal year noted above consists of 52 weeks except fiscal year 2006, which consisted of 53 weeks.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and therefore do not include all of the information and footnotes required by GAAP for comparable annual financial statements. Certain notes and other information have been condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for fiscal year 2009.

SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents — Cash and cash equivalents include bank deposit accounts, money market accounts and other highly liquid investments with original maturities of 90 days or less. At July 31, 2010, substantially all of the cash and cash equivalents were invested in U.S. Treasury bills with original maturities of 90 days or less and overnight federally-sponsored agency notes.

Short-term Investments — Short-term investments consist of investments in securities with maturities of less than one year, excluding investments with original maturities of 90 days or less. At July 31, 2010, short-term investments consisted solely of U.S. Treasury bills with remaining maturities ranging from three to ten months. These investments are classified as held-to-maturity and their market values approximate their carrying values.

Inventories — The Company records inventory at the lower of cost or market (“LCM”). Cost is determined using the first-in, first-out method. The Company capitalizes into inventory certain warehousing and freight delivery costs associated with shipping its merchandise to the point of sale. The Company periodically reviews quantities of inventories on hand and compares these amounts to the expected sales of each product. The Company records a charge to cost of goods sold for the amount required to reduce the carrying value of inventory to net realizable value.

Vendor Rebates — The Company receives credits from vendors in connection with inventory purchases. The credits are separately negotiated with each vendor. Substantially all of these credits are earned in one of two ways: a) as a fixed percentage of the purchase price when an invoice is paid or b) as an agreed-upon amount in the month a new store is opened. There are no contingent minimum purchase amounts, milestones or other contingencies that are required to be met to earn the credits. The credits described in a) above are recorded as a reduction to inventories in the Consolidated Balance Sheets as the inventories are purchased and the credits described in b) above are recorded as a reduction to inventories as new stores are opened. In both cases, the credits are recognized as reductions to cost of goods sold as the product is sold.

Landlord Contributions — The Company typically receives reimbursement from landlords for a portion of the cost of leasehold improvements for new stores and, occasionally, for renovations and relocations. These landlord contributions are initially accounted for as an increase to deferred rent and as an increase to prepaid expenses and other current assets when the related store is opened. When collected, the Company records cash and reduces the prepaid expenses and other current assets account. The collection of landlord contributions is presented in the Condensed Consolidated Statements of Cash Flows as an operating activity. The deferred rent is amortized over the lease term in a manner that is consistent with the Company’s policy to straight-line rent expense over the term of the lease. The amortization is recorded as a reduction to sales and marketing expense which is consistent with the classification of lease expense.

Gift Cards and Certificates — The Company sells gift cards and gift certificates to individuals and companies. The Company’s incentive gift certificates are used by various companies as a reward for achievement for their employees. The Company also redeems proprietary gift cards and gift certificates marketed by third-party premium/incentive companies. The Company records a liability when a gift card/certificate is purchased. As the gift card/certificate is redeemed, the Company reduces the liability and records revenue. Substantially all of the Company’s gift cards/certificates do not have expiration dates and they are all subject to state escheatment laws. Based on historical experience, gift cards/certificates redemptions after the escheatment due date are remote and the Company recognizes any income (also referred to as “breakage”) on these unredeemed gift cards/certificates on a specific identification basis at that time.

Recently Issued Accounting Standards — In June 2009, the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“ASC”) effective for financial statements issued for interim and annual periods ending after September 15, 2009. The ASC is an aggregation of previously issued authoritative GAAP in one comprehensive set of guidance organized by subject area. In accordance with the ASC, references to previously issued accounting standards have been replaced by ASC references. Subsequent revisions to GAAP will be incorporated into the ASC through Accounting Standards Updates (“ASU”).

In October 2009, the FASB issued ASU 2009-13, “Multiple-Deliverable Revenue Arrangements” (“ASU 2009-13”). ASU 2009-13 addresses revenue recognition of multiple-element sales arrangements. It establishes a selling price hierarchy for determining the selling price of each product or service, with vendor-specific objective evidence (“VSOE”) at the highest level, third-party evidence of VSOE at the intermediate level, and a best estimate at the lowest level. It replaces “fair value” with “selling price” in revenue allocation guidance. It also significantly expands the disclosure requirements for such arrangements. ASU 2009-13 will be effective prospectively for sales entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted. The Company is currently evaluating the impact ASU 2009-13 may have on its consolidated financial statements.

SUPPLEMENTAL CASH FLOW DISCLOSURE

The net changes in operating working capital and other components consist of the following:


	Six Months Ended
	August 1, 2009			July 31, 2010
	(In Thousands)

(Increase) decrease in accounts receivable	$	384		$	(2,311	)
(Increase) in inventories		(16,804	)		(7,724	)
(Increase) decrease in prepaids and other assets		3,323			(689	)
Increase in accounts payable		4,517			13,933
(Decrease) in accrued expenses		(15,317	)		(19,005	)
(Decrease) in deferred rent and other noncurrent liabilities		(876	)		(2,192	)


Net (increase) in operating working capital and other components	$	(24,773	)	$	(17,988	)

Interest and income taxes paid were as follows:


	Six Months Ended
	August 1, 2009		July 31, 2010
	(In Thousands)

Interest paid	$	155	$	92
Income taxes paid	$	25,946	$	37,793

As of August 1, 2009 and July 31, 2010, included in Property, plant and equipment, net and Accrued expenses in the Condensed Consolidated Balance Sheets are $0.9 million and $7.0 million, respectively, of accrued property, plant and equipment additions that have been incurred but not completely invoiced by vendors, and therefore, not paid by the respective period-ends. The net changes in these amounts are excluded from payments for capital expenditures and changes in accrued expenses in the Condensed Consolidated Statements of Cash Flows.

EARNINGS PER SHARE

Basic earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is calculated by dividing net income by the diluted weighted average common shares, which reflects the potential dilution of common stock equivalents. The weighted average shares used to calculate basic and diluted earnings per share are as follows:

Three Months Ended

Six Months Ended

August 1, 2009

July 31, 2010

August 1, 2009

July 31, 2010

(In Thousands)

Weighted average shares outstanding for basic EPS

27,437

27,527

27,437

27,527

Dilutive effect of common stock equivalents

344

300

332

296

Weighted average shares outstanding for diluted EPS

27,781

27,827

27,769

27,823

The Company uses the treasury stock method for calculating the dilutive effect of common stock equivalents. For the quarter and six months ended July 31, 2010 there were 63,600 restricted stock units that were anti-dilutive, which were excluded from the calculation of diluted shares. For the quarter and six months ended August 1, 2009, there were no anti-dilutive common stock equivalents.

On June 17, 2010, the Company’s Board of Directors declared a stock split in the form of a 50% stock dividend which was distributed on August 18, 2010 to stockholders of record as of July 30, 2010. All share and per share amounts of common shares included in this Quarterly Report on Form 10-Q have been adjusted to reflect this stock dividend.

INCOME TAXES

Income taxes are accounted for under the asset and liability method in accordance with FASB ASC 740, “Income Taxes,” (“ASC 740”), formerly SFAS No. 109, “Accounting for Income Taxes”. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Consolidated Statements of Income in the period that includes the enactment date.

The Company accounts for uncertainties in income taxes pursuant to ASC 740, formerly FASB Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes”, which clarifies the accounting for uncertainty in income taxes recognized in the financial statements under SFAS 109. The Company recognizes tax liabilities for uncertain income tax positions (“unrecognized tax benefits”) pursuant to ASC 740 where an evaluation has indicated that it is more likely than not that the tax positions will not be sustained in an audit. The Company estimates the unrecognized tax benefits as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company reevaluates these uncertain tax positions on a quarterly basis or when new information becomes available to management. The reevaluations are based on many factors, including but not limited to, changes in facts or circumstances, changes in tax law, successfully settled issues under audit, expirations due to statutes of limitations, and new federal or state audit activity. The Company also recognizes accrued interest and penalties related to these unrecognized tax benefits which are included in the provision for income taxes in the Condensed Consolidated Statements of Income.

The effective income tax rate for the second quarter of fiscal year 2010 was 40.2% as compared with 39.5% for the second quarter of fiscal year 2009. For the first six months of fiscal year 2010, the effective tax rate was 39.8% as compared with 39.3% for the same period of fiscal year 2009. The increases for the second quarter and first six months of fiscal year 2010 are largely related to higher state taxes.

The Company files a federal income tax return and state and local income tax returns in various jurisdictions. The Internal Revenue Service (“IRS”) has audited tax returns through fiscal year 2005, including its examination of the tax return for fiscal year 2005 in fiscal year 2008. No significant adjustments were required to the fiscal year 2005 tax return as a result of the examination by the IRS. In November 2009, the IRS began an examination of the Company’s tax returns for fiscal years 2007 and 2008, which continues to be in progress. The Company believes it has made its best estimate in recording its provision for income taxes in accordance with ASC 740, (formerly FASB Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes”). For the years before fiscal year 2006, the majority of the Company’s state and local income tax returns are no longer subject to examinations by taxing authorities.

In 2010, significant proposed changes to U.S. income tax rules were announced as part of the 2011 budget proposals. The proposed changes could influence the Company’s future income tax expense and/or the timing of income tax deductions. The impact of the proposed changes on our business operations and financial statements remains uncertain. However, as the possibility of enactment progresses, we will continue to monitor current developments and assess the potential implications of these tax law changes on our business.

SEGMENT REPORTING

The Company has two reportable segments: Stores and Direct Marketing. The Stores segment includes all Company-owned stores excluding factory stores (“Full-line Stores”). The Direct Marketing segment includes the Company’s catalog call center and Internet operations. While each segment offers a similar mix of men’s clothing to the retail customer, the Stores segment also provides complete alterations, while the Direct Marketing segment provides certain limited alterations.

The accounting policies of the segments are the same as those described in the summary of significant policies. The Company evaluates performance of the segments based on “four wall” contribution, which excludes any allocation of overhead from the corporate office and the distribution centers (except order fulfillment costs, which are allocated to Direct Marketing), interest and income taxes.

The Company’s segments are strategic business units that offer similar products to the retail customer by two distinctively different methods. In the Stores segment, a typical customer travels to the store and purchases men’s clothing and/or alterations and takes the purchases with him or her. The Direct Marketing customer receives a catalog in his or her home and/or office and/or visits our Internet web site and places an order by phone, mail, fax or online. The merchandise is then shipped to the customer.

Segment data is presented in the following tables (In Thousands):

Three months ended July 31, 2010


	Stores		Direct Marketing		Corporate and Other			Total

Net sales ^(a)	$	169,784	$	15,638	$	2,990		$	188,412
Depreciation and amortization		5,075		113		758			5,946
Operating income (loss)^(b)		40,230		6,160		(18,983	)		27,407
Capital expenditures ^(c)		4,936		872		2,685			8,493

Three months ended August 1, 2009


	Stores		Direct Marketing		Corporate and Other			Total

Net sales ^(a)	$	151,040	$	13,917	$	2,778		$	167,735
Depreciation and amortization		4,824		9		630			5,463
Operating income (loss) ^(b)		30,860		5,570		(15,748	)		20,682
Capital expenditures ^(c)		1,922		182		367			2,471

Six months ended July 31, 2010


	Stores		Direct Marketing		Other			Total

Net sales ^(a)	$	329,596	$	30,974	$	5,967		$	366,537
Depreciation and amortization		10,144		228		1,430			11,802
Operating income (loss) ^(b)		78,085		12,481		(37,098	)		53,468
Capital expenditures ^(c)		7,340		919		4,212			12,471

Six months ended August 1, 2009


	Stores		Direct Marketing		Other			Total

Net sales ^(a)	$	294,811	$	29,343	$	5,506		$	329,660
Depreciation and amortization		9,604		20		1,272			10,896
Operating income (loss) ^(b)		58,356		12,022		(30,847	)		39,531
Capital expenditures ^(c)		5,900		846		667			7,413


(a)		Stores net sales represent all Full-line Store sales. Direct Marketing net sales represent catalog call center and Internet sales. Net sales from segments below the GAAP quantitative thresholds are attributable primarily to three operating segments of the Company. Those segments are factory stores, franchise stores and regional tailor shops. None of these segments have ever met any of the quantitative thresholds for determining reportable segments and are included in “Corporate and Other.”


(b)		Operating income (loss) for the Stores and Direct Marketing segments represents profit before allocations of overhead from the corporate office and the distribution centers, interest and income taxes (“four wall” contribution). Total Company shipping costs to customers of approximately $3.2 million and $2.0 million for the second quarters of fiscal years 2010 and 2009, respectively, and approximately $5.5 million and $3.7 million for the first six months of fiscal years 2010 and 2009, respectively, which primarily related to the Direct Marketing segment, were recorded to “Sales and marketing, including occupancy costs” in the Condensed Consolidated Statements of Income. Operating income (loss) for “Corporate and Other” consists primarily of costs included in general and administrative costs. Total operating income represents profit before interest and income taxes.

(c)		Capital expenditures include payments for property, plant and equipment made for the reportable segment.

LEGAL MATTERS

Massachusetts Laborers’ Annuity Fund (“MLAF”) was the lead plaintiff in a class action filed in the United States District Court for the District of Maryland against the Company, Robert N. Wildrick, R. Neal Black and David E. Ullman (Roy T. Lefkoe v. Jos. A. Bank Clothiers, Inc., et al., Civil Action Number 1:06-cv-01892-WMN) (the “Class Action”). The Class Action was initially instituted on July 24, 2006. On behalf of purchasers of the Company’s stock between December 5, 2005 and June 7, 2006 (the “Class Period”), the Class Action purported to make claims under Sections 10(b) and 20(a) and Rule 10b-5 of the Securities Exchange Act of 1934, based on the Company’s disclosures during the Class Period. The Class Action sought unspecified damages, costs and attorneys’ fees.

In late October 2009, the Company and MLAF agreed to settle the Class Action for an amount that is within the limits of the Company’s insurance coverage. The settlement did not have any impact on the Company’s financial statements. The Stipulation of Settlement (the “Stipulation”) entered into by the Company and MLAF includes a statement that, at the time of the settlement, the substantial discovery completed did not substantiate any of the claims asserted against the individual defendants. By Order dated July 8, 2010 and filed on July 20, 2010, the court approved the settlement of the Class Action in accordance with the Stipulation and dismissed the Class Action with prejudice.

On November 12, 2009, Casey J. Stewart, a former employee of the Company, on behalf of himself and all others similarly situated, filed a Complaint against the Company in the United States District Court for the Northern District of California (Case number CV 09 5348 PJH) alleging racial discrimination by the Company with respect to hiring and terms and conditions of employment. Pursuant to a Motion to Transfer Venue filed by the Company, the Complaint is now pending in the United States District Court for the Eastern District of California as Case number 2:10-cv-00481-GEB-DAD. The Complaint seeks, among other things, certification of the case as a class action, declaratory and injunctive relief, an order mandating corrective action, reinstatement, back pay, front pay, general damages, exemplary and punitive damages, costs and attorneys’ fees. The Company intends to defend this lawsuit vigorously.

The Company is also a party to routine litigation matters that are incidental to its business. From time to time, other legal matters in which the Company may be named as a defendant are expected to arise in the normal course of the Company’s business activities. The resolution of the Company’s litigation matters cannot be accurately predicted and there is no estimate of costs or potential losses, if any. Accordingly, the Company cannot determine whether its insurance coverage would be sufficient to cover such costs or potential losses, if any, and has not recorded any provision for cost or loss associated with these actions. It is possible that the Company’s consolidated financial statements could be materially impacted in a particular fiscal quarter or year by an unfavorable outcome or settlement of any of these actions.

INCENTIVE STOCK OPTION AND OTHER EQUITY PLANS

On March 30, 2010, the Board of Directors approved, subject to stockholder approval, the Jos. A. Bank Clothiers, Inc. 2010 Equity Incentive Plan (the “Equity Incentive Plan”). The Equity Incentive Plan was approved by stockholders at the Company’s 2010 annual meeting of stockholders on June 17, 2010.

The principal purposes of the Equity Incentive Plan are to promote the interests of the Company and its stockholders by providing employees, directors and consultants with appropriate incentives and rewards to encourage them to enter into and continue in the employ or service of the Company or its subsidiaries, to acquire a proprietary interest in the long-term success of the Company and to reward the performance of individuals in fulfilling their personal responsibilities for long-range and annual achievements. In addition, the Equity Incentive Plan is designed to permit the grant of performance-based awards in compliance with the requirements of Section 162(m) of the Internal Revenue Code (“Section 162m”). The Equity Incentive Plan reserves 1.5 million shares of the Company’s common stock for issuance pursuant to awards to be granted under the Equity Incentive Plan.

Under the Equity Incentive Plan, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and stock and cash-based awards. The Company accounts for awards under this plan in accordance with FASB ASC 718, “Share-Based Payment” (“ASC 718”), which requires the compensation cost resulting from all share-based awards to be recognized in the financial statements. The amount of compensation is measured based on the grant-date fair value of the awards and is recognized over the vesting period of the awards.

During the second quarter of fiscal year 2010, the Company granted 86,100 restricted stock units under this plan to certain of its officers and to the members of the Board of Directors with an aggregate grant date fair value of approximately $3.4 million. The grants to the officers are intended to qualify under Section 162(m). The vesting of awards to both the officers and directors is subject to service conditions being met, ranging from one to three years. Additionally, the vesting of awards to officers is subject to performance conditions being met such as, among other things, the attainment of certain annual earnings and performance goals in fiscal year 2010. For these officer awards (which represents approximately $2.5 million of the aggregate grant date fair value), the Company estimates the probability that such goals will be attained based on results-to-date at each interim quarter-end and records compensation cost for these awards based on the awards projected to vest.


Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the unaudited consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q and with the Company’s audited financial statements and notes thereto included in its Annual Report on Form 10-K for fiscal year 2009.

Overview — For the second quarter of fiscal year 2010, the Company’s net income was $16.5 million, an increase of 31.7% as compared with $12.5 million for the second quarter of fiscal year 2009. The Company earned $0.59 per diluted share in the second quarter of fiscal year 2010, as compared with $0.45 per diluted share in the second quarter of fiscal year 2009. As such, diluted earnings per share increased 31.1% as compared with the prior year period. The results of the second quarter of fiscal year 2010, as compared to the second quarter of fiscal year 2009, were primarily driven by:

• 12.3% increase in net sales, driven by a 12.4% increase in the Stores segment sales and a 12.4% increase in the Direct Marketing segment sales;

• 9.2% increase in comparable store sales;

• 130 basis point increase in gross profit margins due mainly to higher merchandise gross margins primarily as a result of higher initial mark-ups driven primarily by improved sourcing; and

• 130 basis point decrease in sales and marketing costs as a percentage of sales driven primarily by the leveraging of occupancy, Stores and Direct Marketing payroll and benefits and advertising and marketing costs, partially offset by higher other variable selling costs as a percentage of sales.

As of the end of the second quarter of fiscal year 2010, the Company had 487 stores, consisting of 463 Company-owned Full-line Stores, 10 Company-owned factory stores, including 3 new factory concept stores, and 14 stores owned and operated by franchisees. The Company opened 17 stores and closed 3 stores in the first six months of fiscal year 2010. In the past five years, the Company has opened over 200 stores. Specifically, there were 56 new stores opened in fiscal year 2005, 52 new stores opened in fiscal year 2006, 48 new stores opened in fiscal year 2007, 40 new stores opened in fiscal year 2008 and 14 new stores opened in fiscal year 2009. The lower number of store openings in fiscal year 2009 compared to previous years was due primarily to the impact of the national economic crisis that occurred during late 2008 and into 2009, including but not limited to a resulting lack of quality real estate opportunities.

The Company expects to open approximately 35 to 40 stores in fiscal year 2010, including the 17 stores opened in the first six months of fiscal year 2010. This range includes approximately five stores the Company plans to open under its new Company-owned factory store concept of which three were opened during the second quarter of fiscal year 2010. The increase in store openings over fiscal year 2009 is primarily the result of the emergence of quality real estate opportunities in the marketplace and the Company’s desire to return to its more normal store expansion pace. In the future, the Company believes that it can grow the chain to approximately 600 Full-line Stores and 50 to 75 factory stores in the United States depending on the performance of the Company over the next several years and the outcome of the initial factory store test phase.

Capital expenditures in fiscal year 2010 are expected to be approximately $30 to $35 million, primarily to fund the opening of approximately 35 to 40 new stores, the renovation and/or relocation of several stores, the expansion of the Company’s distribution and office space, expenditures related to new business initiatives including tuxedo rentals and factory stores and the implementation of various systems projects. The capital expenditures include the cost of the construction of leasehold improvements for new stores and the renovation or relocation of several stores, of which approximately $4 to $5 million is expected to be reimbursed through landlord contributions.

For fiscal year 2010, the Company expects inventories to increase over fiscal year 2009 as a result of new store openings, sales growth and new business initiatives such as factory stores.

Critical Accounting Policies and Estimates — In preparing the consolidated financial statements, a number of assumptions and estimates are made that, in the judgment of management, are proper in light of existing general economic and company-specific circumstances. For a detailed discussion of the application of these and other accounting policies, see Note 1 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for fiscal year 2009.

Inventory. The Company records inventory at the lower of cost or market (“LCM”). Cost is determined using the first-in, first-out method. The estimated market value is based on assumptions for future demand and related pricing. The Company reduces the carrying value of inventory to net realizable value where cost exceeds estimated selling price less costs of disposal.

Management’s sales assumptions regarding sales below cost are based on the Company’s experience that most of the Company’s inventory is sold through the Company’s primary sales channels, with virtually no inventory being liquidated through bulk sales to third parties. The Company’s LCM reserve estimates for inventory that have been made in the past have been very reliable as a significant portion of its sales (over two-thirds in fiscal year 2009) are of classic traditional products that are part of on-going programs and that bear low risk of declines in value below cost. These products include items such as navy and gray suits, navy blazers, white and blue dress shirts, etc. To limit the need to sell significant amounts of product below cost, all product categories are closely monitored in an attempt to identify and correct situations in which aging goals have not been, or are reasonably likely to not be achieved. In addition, the Company’s strong gross profit margins enable the Company to sell substantially all of its products at levels above cost.

To calculate the estimated market value of its inventory, the Company periodically performs a detailed review of all of its major inventory classes and stock-keeping units and performs an analytical evaluation of aged inventory on a quarterly basis. Semi-annually, the Company compares the on-hand units and season-to-date unit sales (including actual selling prices) to the sales trend and estimated prices required to sell the units in the future, which enables the Company to estimate the amount which may have to be sold below cost. Substantially all of the units sold below cost are sold in the Company’s factory stores, through the Company’s Internet web site or on clearance at the Full-line Stores, typically within 24 months of purchase. The Company’s costs in excess of selling price for units sold below cost totaled $1.4 million and $1.2 million in fiscal year 2008 and fiscal year 2009, respectively. The Company reduces the carrying amount of its current inventory value for product in its inventory that may be sold below its cost. If the amount of inventory which is sold below its cost differs from the estimate, the Company’s inventory valuation adjustment could change.

Asset Valuation. Long-lived assets, such as property, plant and equipment subject to depreciation, are reviewed for impairment to determine whether events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset. The asset valuation estimate is principally dependent on the Company’s ability to generate profits at both the Company and store levels. These levels are principally driven by the sales and gross profit trends that are closely monitored by the Company. While the Company performs a quarterly review of its long-lived assets to determine if an impairment exists, the fourth quarter is typically the most significant quarter to make such a determination since it provides the best indication of performance trends in the individual stores. There were no asset valuation charges in either the first six months of fiscal year 2010 or the first six months of fiscal year 2009.

Lease Accounting. The Company uses a consistent lease period (generally, the initial non-cancelable lease term plus renewal option periods provided for in the lease that can be reasonably assured) when calculating amortization of leasehold improvements and in determining straight-line rent expense and classification of its leases as either an operating lease or a capital lease. The lease term and straight-line rent expense commence on the date when the Company takes possession and has the right to control the use of the leased premises. Funds received from the lessor intended to reimburse the Company for the costs of leasehold improvements are recorded as a deferred rent resulting from a lease incentive and amortized over the lease term as a reduction to rent expense.

While the Company has taken reasonable care in preparing these estimates and making these judgments, actual results could and probably will differ from these estimates. Management believes any difference in the actual results from the estimates will not have a material effect upon the Company’s financial position or results of operations. These estimates, among other things, were discussed by management with the Company’s Audit Committee.

Recently Issued Accounting Standards — In June 2009, the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Codification (“ASC”) effective for financial statements issued for interim and annual periods ending after September 15, 2009. The ASC is an aggregation of previously issued authoritative GAAP in one comprehensive set of guidance organized by subject area. In accordance with the ASC, references to previously issued accounting standards have been replaced by ASC references. Subsequent revisions to GAAP will be incorporated into the ASC through Accounting Standards Updates (“ASU”).

Results of Operations

The following table is derived from the Company’s Condensed Consolidated Statements of Income and sets forth, for the periods indicated, the items included in the Condensed Consolidated Statements of Income expressed as a percentage of net sales.


	Percentage of Net Sales						Percentage of Net Sales
	Three Months Ended						Six Months Ended
	August 1, 2009			July 31, 2010			August 1, 2009			July 31, 2010

Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of goods sold		38.5			37.2			38.8			36.8
Gross profit		61.5			62.8			61.2			63.2
Sales and marketing expenses		40.4			39.1			40.2			39.4
General and administrative expenses		8.8			9.1			8.9			9.3
Total operating expenses		49.2			48.3			49.2			48.6
Operating income		12.3			14.5			12.0			14.6
Total other income		—			0.1			—			—
Income before provision for income taxes		12.3			14.6			12.0			14.6
Provision for income taxes		4.9			5.9			4.7			5.8

Net income		7.5	%		8.7	%		7.3	%		8.8	%

Net Sales — Net sales increased 12.3% to $188.4 million in the second quarter of fiscal year 2010, as compared with $167.7 million in the second quarter of fiscal year 2009. Net sales for the first six months of fiscal year 2010 increased 11.2% to $366.5 million, as compared with $329.7 million in the first six months of 2009. The sales increases were primarily related to increases in Stores sales of 12.4% and 11.8% for the second quarter and first six months of fiscal year 2010, respectively, including comparable store sales increases of 9.2% and 9.8% for the second quarter and first six months of fiscal year 2010, respectively. Comparable store sales include merchandise sales generated in all Company-owned stores that have been open for at least thirteen full months. The 9.2% increase in comparable store sales for the second quarter of fiscal year 2010 was led by increased traffic (as measured by number of transactions), partially offset by lower dollars per transaction and items per transaction. The 9.8% increase in comparable store sales for the first six months of fiscal year 2010 was led by increased traffic and higher items per transaction, partially offset by lower dollars per transaction.

Direct Marketing sales increased 12.4% and 5.6% for the second quarter and the first six months of fiscal year 2010, respectively, driven by increases in sales in the Internet channel, which represents the major portion of this reportable segment, and increases in sales through the catalog call center. The increases in the Internet channel were primarily the result of higher website traffic.

Of the major product categories, tailored clothing including suits, sportcoats, blazers and other and dress shirts generated strong unit sales growth during the second quarter and first six months of fiscal year 2010, while sportswear category units grew more modestly during these periods.

The following table summarizes store opening and closing activity during the respective periods.


	Three Months Ended										Six Months Ended
	August 1, 2009				July 31, 2010						August 1, 2009				July 31, 2010
			Square					Square					Square					Square
	Stores		Feet*		Stores			Feet*			Stores		Feet*		Stores			Feet*

Stores open at the beginning of the period		463		2,104		476			2,142			460		2,091		473			2,131
Stores opened		4		17		14			55			7		30		17			66
Stores closed		—		—		(3	)		(9	)		—		—		(3	)		(9	)

Stores open at the end of the period		467		2,121		487			2,188			467		2,121		487			2,188


*		Square feet is presented in thousands and excludes the square footage of the Company’s franchise stores.

Gross profit — The Company’s gross profit represents net sales less cost of goods sold. Cost of goods sold primarily includes the cost of merchandise, the cost of tailoring and freight from vendors to the distribution center and from the distribution center to the stores. This gross profit classification may not be comparable to the classification used by certain other entities. Some entities include distribution (including depreciation), store occupancy, buying and other costs in cost of goods sold. Other entities (including the Company) exclude such costs from gross profit, including them instead in general and administrative and/or sales and marketing expenses.

Gross profit totaled $118.3 million or 62.8% of net sales in the second quarter of fiscal year 2010, as compared with $103.2 million or 61.5% of net sales in the second quarter of fiscal year 2009, an increase in gross profit dollars of $15.1 million and an increase in the gross profit margin (gross profit as a percent of net sales) of 130 basis points. Gross profit totaled $231.6 million or 63.2% of net sales for the first six months of fiscal year 2010, as compared with $201.6 million or 61.2% of net sales for the first six months of fiscal year 2009, an increase in gross profit dollars of $30.0 million and an increase in the gross profit margin of 200 basis points. The increases in the gross profit margin was mainly due to higher merchandise gross margins primarily as a result of higher initial mark-ups as compared to the prior year period driven primarily by improved sourcing. In addition, the improvement in merchandise gross margins was due in part to a change in the product mix with a lower proportion of clearance items sold as compared to fiscal year 2009. As stated in the Company’s Annual Report on Form 10-K for fiscal year 2009, the Company is subject to certain risks that may affect its gross profit, including risks of doing business on an international basis, increased costs of raw materials and other resources and changes in economic conditions. The Company expects to continue to be subject to these gross profit risks in the future. Additionally, the Company’s gross margin may be negatively impacted during the development phase of some of its new business initiatives such as the newly-launched tuxedo rental business and the factory store concept.

Sales and Marketing Expenses — Sales and marketing expenses consist primarily of a) Full-line Store, factory store and Direct Marketing occupancy, payroll and benefits, selling and other variable selling costs (which include such costs as shipping costs to customers and credit card processing fees) and b) total Company advertising and marketing expenses. Sales and marketing expenses increased to $73.7 million or 39.1% of sales in the second quarter of fiscal year 2010 from $67.7 million or 40.4% of sales in the second quarter of fiscal year 2009. Sales and marketing expenses increased to $144.3 million or 39.4% of sales in the first six months of fiscal year 2010 from $132.6 million or 40.2% of sales in the first six months of fiscal year 2009. The decrease as a percentage of sales for the second quarter and the first six months of fiscal year 2010 was driven primarily by the leveraging of occupancy costs and Stores and Direct Marketing payroll and benefits costs, partially offset by higher other variable selling costs as a percentage of sales. Additionally, the decrease as a percentage of sales for the second quarter was also driven by the leveraging of the Company’s advertising and marketing costs. The overall improved leverage was achieved primarily as a result of cost control initiatives and strong sales growth.

The increase in sales and marketing expenses relates primarily to the strong sales growth and the opening of 24 new stores and the closing of four stores since the end of the second quarter of fiscal year 2009. For the second quarter of fiscal year 2010, the increase of approximately $6.0 million consists of a) $2.2 million related to additional Stores and Direct Marketing payroll and benefits costs, b) $1.6 million related to additional other variable selling costs, c) $1.1 million related to additional occupancy costs, and d) $1.1 million related to advertising and marketing expenses. For the first six months of fiscal year 2010, the increase of approximately $11.7 million consists of a) $4.1 million related to additional Stores and Direct Marketing payroll and benefits costs, b) $2.9 million related to advertising and marketing expenses, c) $2.8 million related to additional other variable selling costs, and d) $1.9 million related to additional occupancy costs. The Company expects sales and marketing expenses to increase for the remainder of fiscal year 2010 as compared to fiscal year 2009 primarily as a result of opening new stores (35 to 40 stores) in fiscal year 2010, the full year operation of stores that were opened during fiscal year 2009, an increase in advertising expenditures, driven both by volume and price increases, and costs related to new business initiatives.

General and Administrative Expenses — General and administrative expenses (“G&A”), which consist primarily of corporate and distribution center costs, were $17.2 million and $14.8 million for the second quarter of fiscal year 2010 and the second quarter of fiscal year 2009, respectively. G&A expenses were $33.9 million for the first six months of fiscal year 2010 compared to $29.5 million for the first six months of fiscal year 2009. As a percent of net sales, G&A expenses were 9.1% and 8.8% for the second quarters of fiscal years 2010 and 2009, respectively, and 9.3% and 8.9% for the first six months of fiscal years 2010 and 2009, respectively. The increases as a percentage of sales were driven primarily by higher professional fees and higher other corporate overhead costs.

For the second quarter of fiscal year 2010, the increase of approximately $2.4 million was due to a) $0.6 million of higher corporate compensation costs (which include all company incentive compensation) and group medical costs, b) $0.4 million of higher professional fees, c) $1.1 million of higher other corporate overhead costs, and d) $0.3 million of higher distribution center costs. For the first six months of fiscal year 2010, the increase of approximately $4.4 million was due to a) $1.8 million of higher corporate compensation costs and group medical costs, b) $0.8 million of higher professional fees, c) $1.4 million of higher other corporate overhead costs, and d) $0.4 million of higher distribution center costs. Growth in the Stores and Direct Marketing segments may result in further increases in G&A expenses in the future.

Other Income (Expense) — Other income (expense) for the second quarter and the first six months of fiscal year 2010 was $0.2 million of income compared to less than $0.1 million of expenses for the second quarter and the first six months of fiscal year 2009. The improvements over fiscal year 2009 were due primarily to higher average cash and cash equivalents and short-term investment balances during the fiscal year 2010 period and lower financing fees in fiscal year 2010 due to the expiration of the Company’s credit facility in the first quarter of fiscal year 2010.

Income Taxes — The effective income tax rate for the second quarter of fiscal year 2010 was 40.2% as compared with 39.5% for the second quarter of fiscal year 2009. For the first six months of fiscal year 2010, the effective tax rate was 39.8% as compared with 39.3% for the same period of fiscal year 2009. The increases for the second quarter and first six months of fiscal year 2010 are largely related to higher state taxes.

Seasonality — The Company’s net sales, net income and inventory levels fluctuate on a seasonal basis and therefore the results for one quarter are not necessarily indicative of the results that may be achieved for a full fiscal year. The increased customer traffic during the holiday season and the Company’s increased marketing efforts during this peak selling time have resulted in sales and profits generated during the fourth quarter being a substantial portion of annual sales and profits as compared to the other three quarters. Seasonality is also impacted by growth as more new stores have historically been opened in the second half of the year. During the fourth quarters of fiscal years 2007, 2008 and 2009, the Company generated approximately 35%, 36% and 36%, respectively, of its annual net sales and approximately 53%, 52% and 50%, respectively, of its annual net income.

Liquidity and Capital Resources — The Company’s principal sources of liquidity are its cash from operations, cash and cash equivalents and short-term investments. These sources of liquidity are used for the Company’s ongoing cash requirements. During the past several years and through the first quarter of fiscal year 2010, the Company maintained a $100 million credit facility with a maturity date of April 30, 2010. Based on the Company’s cash and short-term investment positions, and projected cash needs and market conditions, the Company elected not to negotiate a renewal or replacement of the credit facility. As a result, the credit facility expired on April 30, 2010 in accordance with its terms.

The following table summarizes the Company’s sources and uses of funds as reflected in the Condensed Consolidated Statements of Cash Flows (In Thousands):


	Six Months Ended
	August 1, 2009			July 31, 2010

Cash provided by (used in):
Operating activities	$	10,381		$	25,068
Investing activities		(72,292	)		42,574
Financing activities		—			—

Net increase (decrease) in cash and cash equivalents	$	(61,911	)	$	67,642

The Company’s cash and cash equivalents consist primarily of U.S. Treasury bills with original maturities of 90 days or less and overnight federally-sponsored agency notes. The Company’s short-term investments consist of U.S. Treasury bills with remaining maturities of less than one year, excluding investments with original maturities of 90 days or less. At July 31, 2010, the Company’s cash and cash equivalents balance was $89.5 million and its short-term investments were $114.7 million, for a total of $204.2 million, as compared with a cash and cash equivalents balance of $61.0 million and short-term investment of $64.9 million, for a total of $125.9 million at August 1, 2009. The Company’s cash and cash equivalents balance was $21.9 million and short-term investments were $169.7 million, for a total of $191.6 million at the end of fiscal year 2009. The Company had no debt outstanding at July 31, 2010, August 1, 2009 or at the end of fiscal year 2009. The significant changes in sources and uses of funds through July 31, 2010 are discussed below.

Cash provided by the Company’s operating activities of $25.1 million in the first six months of fiscal year 2010 was primarily impacted by net income of $32.3 million and depreciation and amortization of $11.8 million, partially offset by an increase in operating working capital and other operating items of $18.0 million. The increase in operating working capital and other operating items included an increase in inventory of $7.7 million related largely to new store openings and the launch of its factory store initiative. In addition, the increase in operating working capital and other operating items included a reduction in accrued expenses totaling $19.0 million (excluding accrued property, plant and equipment) related primarily to the payment of income taxes and incentive compensation that had been accrued at the end of fiscal year 2009, partially offset by an increase in accounts payable of $13.9 million due primarily to the timing of payments to vendors. Accrued expenses represent all other short-term liabilities related to, among other things, vendors from whom invoices have not been received, employee compensation, federal and state income taxes and unearned gift cards and gift certificates. Accounts payable represent all short-term liabilities for which the Company has received a vendor invoice prior to the end of the reporting period. The increase in operating working capital and other operating items also included an increase in accounts receivable of $2.3 million due to higher credit card receivables from transactions through American Express, MasterCard and Visa as a result of increased sales near the end of the second quarter of fiscal year 2010 as compared with the end of the fourth quarter of fiscal year 2009.

Cash provided by investing activities of $42.6 million for the first six months of fiscal year 2010 relates to $55.0 million of net maturities of short-term investments, partially offset by approximately $12.5 million of payments for capital expenditures, as described below.

For fiscal year 2010, the Company expects to spend approximately $30 to $35 million on capital expenditures, primarily to fund the opening of approximately 35 to 40 new stores, the renovation and/or relocation of several stores, the expansion of the Company’s distribution and office space, expenditures related to new business initiatives including tuxedo rentals and factory stores and the implementation of various systems projects. The capital expenditures include the cost of the construction of leasehold improvements for new stores and several stores to be renovated or relocated, of which approximately $4 to $5 million is expected to be reimbursed through landlord contributions. These amounts are typically paid by the landlords after the completion of construction by the Company and the receipt of appropriate lien waivers from contractors. The Company spent approximately $12.5 million on capital expenditures in the first six months of fiscal year 2010 largely related to partial payments for the 17 stores opened during the first six months of the fiscal year, plus expenditures related to the expansion of its distribution and office space and expenditures related to the tuxedo rental initiative. In addition, capital expenditures for the period include payments for property, plant and equipment additions accrued at year-end fiscal year 2009 related to stores opened in fiscal year 2009. For the stores opened and renovated in the first six months of fiscal year 2010, the Company negotiated approximately $1.6 million of landlord contributions. The table below summarizes the landlord contributions that were negotiated and collected related to the stores opened in fiscal years 2010 and 2009.


					Amounts
			Amounts		Collected		Amounts
			Collected in		YTD in		Outstanding
	Negotiated		Fiscal Year		Fiscal Year		July 31,
	Amounts		2009		2010		2010
	(In Thousands )
Full Fiscal Year 2009 Store Openings (14 Stores)	$	2,829	$	2,170	$	637	$	22
First Six Months of Fiscal Year 2010 Store Openings (17 Stores)		1,641		—		185		1,456

	$	4,470	$	2,170	$	822	$	1,478

The outstanding amounts of the landlord contributions for the stores opened and renovated in fiscal year 2009 and fiscal year 2010 are primarily expected to be received within the next 12 months.

For fiscal year 2010, the Company expects inventories to increase over fiscal year 2009 to support new store openings, sales growth and new business initiatives such as factory stores.

Management believes that the Company’s cash from operations, existing cash and cash equivalents and short-term investments will be sufficient to fund its planned capital expenditures and operating expenses through at least the next 12 months.

Off-Balance Sheet Arrangements — The Company has no off-balance sheet arrangements other than its operating lease agreements.

Disclosures about Contractual Obligations and Commercial Commitments

The Company’s principal commitments are non-cancellable operating leases in connection with its retail stores, certain tailoring facilities and equipment. Under the terms of certain of the retail store leases, the Company is required to pay a base annual rent, plus a contingent amount based on sales (“contingent rent”). In addition, many of these leases include scheduled rent increases. Base annual rent and scheduled rent increases are included in the contractual obligations table below for operating leases, as these are the only rent-related commitments that are determinable at this time.

The following table reflects a summary of the Company’s contractual cash obligations and other commercial commitments for the periods indicated, including amounts paid in the first six months of fiscal year 2010 unless otherwise indicated.


	Payments Due by Fiscal Year
	(In Thousands)
							Beyond
	2010		2011-2013		2014-2015		2015		Total^(f)

Operating leases ^{(a) (b)}	$	56,878	$	168,932	$	77,148	$	68,799	$	371,757
Inventory Purchase Commitments ^(c)		146,309		9,828		—		—		156,137
Related Party Agreement ^(d)		825		825		—		—		1,650
License agreement ^(e)		165		495		330		—		990


(a)		Includes various lease agreements for stores to be opened and equipment placed in service subsequent to

		July 31, 2010.

(b)		Excludes contingent rent and other lease costs.

(c)		Represents the value of expected future inventory purchases for which purchase orders have been issued to vendors as of July 31, 2010.

(d)		Relates to consulting agreement with the Company’s current Chairman of the Board to consult on matters of strategic planning and initiatives.

(e)		Related to an agreement with David Leadbetter, a golf professional, which allows the Company to produce golf and other apparel under his name.

(f)		Obligations related to unrecognized tax benefits and related penalties and interest of $0.9 million have been excluded from the above table as the amount to be settled in cash and the specific payment dates are not known.

Cautionary Statement

This Quarterly Report on Form 10-Q includes and incorporates by reference certain statements that may be deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward-looking statements so long as such information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the information. When used in this Quarterly Report on Form 10-Q, the words “estimate,” “project,” “plan,” “will,” “anticipate,” “expect,” “intend,” “outlook,” “may,” “believe,” and other similar expressions are intended to identify forward-looking statements and information.

Actual results may differ materially from those forecast due to a variety of factors outside of the Company’s control that can affect the Company’s operating results, liquidity and financial condition. Such factors include risks associated with economic, weather, public health and other factors affecting consumer spending, including negative changes to consumer confidence and other recessionary pressures, higher energy and security costs, the successful implementation of the Company’s growth strategy, including the ability of the Company to finance its expansion plans, the mix and pricing of goods sold, the effectiveness and profitability of new concepts, the market price of key raw materials such as wool and cotton, seasonality, merchandise trends and changing consumer preferences, the effectiveness of the Company’s marketing programs, the availability of suitable lease sites for new stores, doing business on an international basis, the ability to source product from its global supplier base, legal matters and other competitive factors. The identified risk factors and other factors and risks that may affect the Company’s business or future financial results are detailed in the Company’s filings with the Securities and Exchange Commission, including, but not limited to, those described under “Risk Factors” in the Company’s Annual Report on Form 10-K for fiscal year 2009 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q. These cautionary statements qualify all of the forward-looking statements the Company makes herein. The Company cannot assure you that the results or developments anticipated by the Company will be realized or, even if substantially realized, that those results or developments will result in the expected consequences for the Company or affect the Company, its business or its operations in the way the Company expects. The Company cautions you not to place undue reliance on these forward-looking statements, which speak only as of their respective dates. The Company does not undertake an obligation to update or revise any forward-looking statements to reflect actual results or changes in the Company’s assumptions, estimates or projections.


Item 3.		Quantitative and Qualitative Disclosures About Market Risk

At July 31, 2010, the Company was not a party to any derivative financial instruments. The Company does business with all of its product vendors in U.S. currency and does not have direct foreign currency risk. However, a devaluation of the U.S. dollar against the foreign currencies of its suppliers could have a material adverse effect on the Company’s product costs and resulting gross profit. The Company currently invests substantially all of its excess cash in short-term investments, primarily in U.S. Treasury bills with original maturities of less than one year, overnight federally-sponsored agency notes and money market accounts, where returns effectively reflect current interest rates. As a result, market interest rate changes may impact the Company’s net interest income or expense. The impact will depend on variables such as the magnitude of rate changes and the level of excess cash balances. A 100 basis point change in interest rates would have changed net interest income by approximately $1.4 million in fiscal year 2009.


Item 4.		Controls and Procedures

Limitations on Control Systems. Because of their inherent limitations, disclosure controls and procedures and internal control over financial reporting (collectively, “Control Systems”) may not prevent or detect all failures or misstatements of the type sought to be avoided by Control Systems. Also, projections of any evaluation of the effectiveness of the Company’s Control Systems to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management, including the Company’s Chief Executive Officer (the “CEO”) and Chief Financial Officer (the “CFO”), does not expect that the Company’s Control Systems will prevent all errors or all fraud. A Control System, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the Control System are met. Further, the design of a Control System must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all Control Systems, no evaluation can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Reports by management, including the CEO and CFO, on the effectiveness of the Company’s Control Systems express only reasonable assurance of the conclusions reached.

Disclosure Controls and Procedures. The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Management, with the participation of the CEO and CFO, has evaluated the effectiveness, as of July 31, 2010, of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, the CEO and CFO have concluded that the Company’s disclosure controls and procedures were effective as of July 31, 2010.

Changes in Internal Control over Financial Reporting. There were no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Section 240.13a-15 of the Exchange Act that occurred during the Company’s last fiscal quarter (the Company’s fourth quarter in the case of an annual report) that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION


Item 1.		Legal Proceedings


Item 1A.		Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed under the caption “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for fiscal year 2009, which could materially affect the Company’s business, financial condition or future results. The risks described in the Company’s Annual Report on Form 10-K are not the only risks facing the Company. Additional risks and uncertainties, including those not currently known to the Company or that the Company currently deems to be immaterial also could materially adversely affect the Company’s business, financial condition and/or operating results. There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for fiscal year 2009.


Item 5.		Other Information

Amended and Restated Employment Agreement of R. Neal Black

On August 30, 2010, the Company entered into an Amended and Restated Employment Agreement (the “Employment Agreement”) with R. Neal Black pursuant to which Mr. Black is employed as the Company’s Chief Executive Officer for a term expiring on January 26, 2013, subject to earlier termination as provided in the Employment Agreement, at a current annual base salary of $775,000. Beginning in fiscal year 2011, Mr. Black’s base salary will be increased at least once each fiscal year in an amount not less than the percentage increase in the consumer price index over the most recently reported 12-month period, provided, however, that in the event the Company does not grant base salary increases generally for other employees of the Company in any particular fiscal year, Mr. Black shall not be entitled to a base salary increase for that fiscal year. Mr. Black is entitled to an annual bonus opportunity of up to 400% of his base salary, based upon the achievement of annual performance goals. If earned, the bonus may be payable in cash or a combination of cash and equity, as determined by the Compensation Committee, provided that not less than 150% of base salary shall be payable as a cash bonus. Mr. Black is entitled to a car allowance of $1,600 per month and other benefits as are, from time to time, generally provided by the Company to senior management employees.

Under the Employment Agreement, in the event that Mr. Black’s employment is terminated by the Company without “cause” or by Mr. Black for “good reason” or within 90 days following a “change of control” (each as defined in the Employment Agreement), Mr. Black will be entitled to be paid $1,550,000 plus, if applicable, any cash bonus payable for the last full bonus year. If Mr. Black’s employment is not renewed or continued for at least one additional year following the end of the term, Mr. Black will be entitled to payment of $775,000 plus, if applicable, any cash bonus due for the last full bonus year and the vesting of any earned but unvested restricted stock units. The Employment Agreement also provides for the acceleration of certain payments following certain other termination events. In any of the foregoing events, the Company would have no further obligation to continue any other benefits past the date of termination. Mr. Black will be subject to certain non-compete restrictions following the term of his employment with the Company.

The Employment Agreement is filed as Exhibit 10.1 to this Quarterly Report on Form 10-Q. The foregoing summary description is qualified in its entirety by reference to the full text of the Employment Agreement incorporated by reference herein.

Indemnification Agreements

On August 30, 2010, the Company entered into indemnification agreements with each of Robert B. Hensley, Executive Vice President for Human Resources, Real Estate and Loss Prevention and Charles. D. Frazer, Senior Vice President, General Counsel and Secretary (each, an “Indemnification Agreement”). The Indemnification Agreements are in the same form the Company entered into with each of the Company’s directors (including R. Neal Black) and David E. Ullman, the Company’s Chief Financial Officer. Each of the Indemnification Agreements provides the indemnitee with a contractual right to indemnification, and to the advancement of expenses, if, by reason of his status as a present or former director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that he is or was serving in such capacity at the request of the Company, such indemnitee is, or is threatened to be, made a party to or a witness in any threatened, pending or completed proceeding, subject to the terms, limitations and conditions set forth in the Indemnification Agreement. The rights under the Indemnification Agreement are in addition to any rights the parties may have under law, the Company’s certificate of incorporation and the Company’s bylaws.

The Indemnification Agreements with Messrs. Hensley and Frazer are filed as Exhibits 10.2 and 10.3, respectively, to this Quarterly Report on Form 10-Q. The foregoing summary description is qualified in its entirety by reference to the full text of the Indemnification Agreements incorporated by reference herein.


Item 6.		Exhibits


Exhibits

	10.1	Amended and Restated Employment Agreement, dated August 30, 2010, by and between R. Neal Black and Jos. A. Bank Clothiers, Inc.
	10.2	Indemnification Agreement dated August 30, 2010 between JoS. A. Bank Clothiers, Inc. and Robert B. Hensley.
	10.3	Indemnification Agreement dated August 30, 2010 between JoS. A. Bank Clothiers, Inc. and Charles D. Frazer.
	10.4	Seventh Amendment, dated as of June 17, 2010 to Amended and Restated Employment Agreement, dated May 15, 2002, by and between Charles D. Frazer and Jos. A. Bank Clothiers, Inc.
	31.1	Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2	Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1	Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	Jos. A. Bank Clothiers, Inc. (Registrant)
Dated: September 1, 2010	/s/ DAVID E. ULLMAN
	David E. Ullman
	Executive Vice President, Chief Financial Officer (Principal Financial and Accounting Officer and Duly Authorized Officer)

Exhibit Index


Exhibits

	10.1	Amended and Restated Employment Agreement, dated August 30, 2010, by and between R. Neal Black and Jos. A. Bank Clothiers, Inc.
	10.2	Indemnification Agreement dated August 30, 2010 between JoS. A. Bank Clothiers, Inc. and Robert B. Hensley.
	10.3	Indemnification Agreement dated August 30, 2010 between JoS. A. Bank Clothiers, Inc. and Charles D. Frazer.
	10.4	Seventh Amendment, dated as of June 17, 2010 to Amended and Restated Employment Agreement, dated May 15, 2002, by and between Charles D. Frazer and Jos. A. Bank Clothiers, Inc.
	31.1	Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2	Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1	Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EX-10.1 2 c05556exv10w1.htm EXHIBIT 10.1 Exhibit 10.1

EXHIBIT 10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT, dated as of the 30^th day of August, 2010, between JOS. A. BANK CLOTHIERS, INC. (“Employer” or “Company”) and R. NEAL BLACK (“Executive”),

WITNESSETH THAT:

WHEREAS, Employer and Executive are the sole parties to that certain Employment Agreement, dated as of September 9, 2008 (the “Original Employment Agreement”); and

WHEREAS, Employer and Executive have determined to amend and restate the Original Employment Agreement in its entirety,

NOW THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, the receipt and adequacy of which are hereby acknowledged, Employer and Executive do hereby amend and restate the Original Employment Agreement in its entirety and agree as follows:

1. Employment of Executive

Employer hereby agrees to employ Executive, and Executive hereby agrees to be in the employ of Employer, upon the terms and conditions hereinafter set forth. This Agreement is a contract for personal services of Executive and services pursuant hereto may only be performed by Executive.

2. Employment Period

The term of Executive’s employment under this Agreement (the “Employment Period”) commenced December 21, 2008 and shall, subject to earlier termination as provided in Section 5, continue through January 26, 2013.

3. Duties and Responsibilities

3.1 General. During the Employment Period, Executive (i) shall have the title of Chief Executive Officer of the Company and (ii) shall devote substantially all of his business time and expend his best efforts, energies and skills to the business of the Company. The preceding sentence shall not be construed to prohibit Executive from continuing to devote more than an insignificant amount of time, in accordance with his past practice, to management of his investments, serving on boards of directors, performing consulting services on his own time (except for retail department stores where the consulting services are focused on the men’s clothing business or for specialty men’s stores) and participation in civic and philanthropic activities.

Executive shall perform such duties, consistent with his status as Chief Executive Officer, as he may be assigned from time to time by Employer’s Board of Directors (the “Board”). Executive shall have such authority, discretion, power and responsibility, and shall be entitled to an office, secretarial and administrative assistance (at least one secretary and/or administrative assistant of his selection) and other facilities and conditions of employment, as are customary or appropriate to his position. Without limitation of the generality of the foregoing, but subject to any applicable legal requirements, Executive, within the general guidelines adopted from time to time by the Board, shall have the power, without further approval of the Board, to hire, fire and establish the terms of employment (including all compensation and bonus arrangements) of all employees of, and consultants and other advisers to, the Company (other than the Chairman of the Board). Executive shall also serve without additional compensation as a director of the Employer and, if he should so desire, as a director of any subsidiaries of the Company. At the request of the Board, Executive shall also serve without additional compensation as a director of any subsidiaries of the Employer. Executive agrees to resign any and all such directorships concurrently with the expiration or other termination of his employment hereunder. Notwithstanding anything to the contrary contained herein, in the event Employer shall acquire another company or enterprise (or the business or operations thereof) (an “acquisition”), “Company” shall mean the subsidiary or division of Employer responsible for the operations of the entity “Jos. A. Bank Clothiers” as it exists immediately prior to an acquisition (such subsidiary or division being hereinafter referred to as “Clothiers”) and all corporations, associations, companies, partnerships, firms and other enterprises controlled by Clothiers. Following an acquisition, the entity which will own or control Clothiers is herein referred to as “Holding” and the “Board” referred to herein shall be the Board of Directors of Holding. In the event of an acquisition, Executive shall remain Chief Executive Officer of Clothiers and shall report to the chief executive officer of Holding. Executive shall not, unless otherwise determined by the chief executive officer of Holding, become the chief executive officer of, or have any responsibilities with respect to, the acquired entity.

3.2 Location of Executive Offices. The Company will maintain its principal executive offices at a location in the Baltimore, Maryland metropolitan area.

4. Compensation and Related Matters

4.1 Base Salary. Employer shall pay to Executive during the Employment Period an annual base salary (the “Base Salary”) in accordance with this Section 4.1. Prior to the date on which base salary increases, if any, go into effect generally for other employees of the Company, the Base Salary in Fiscal 2010 shall be $750,000. In the event base salary increases go into effect generally for other employees of the Company in Fiscal 2010, the Base Salary on and after the date of such increases shall be $775,000. Beginning in Fiscal 2011, the Compensation Committee of the Board (the “Compensation Committee”) shall increase the Base Salary at least once each fiscal year on the date on which general salary increases within the Company, if any, for such year take effect (the “Annual Increase Date”). The annual increase shall be in an amount not less than the percentage increase in the consumer price index over the most recently reported 12-month period. In the event the Compensation Committee fails to so increase the Base Salary in any such fiscal year by the Annual Increase Date, the Base Salary shall automatically be increased on such date by an amount equal to the percentage increase in the consumer price index over the most recently reported 12-month period. Notwithstanding anything to the contrary contained herein, in the event the Company does not grant base salary increases generally for other employees of the Company in any particular fiscal year, Executive shall not be entitled to a Base Salary increase for that fiscal year. The Base Salary shall be payable in installments in accordance with the Company’s policy on payment of executives in effect from time to time. All references in this Agreement to “fiscal year” or to a particular “Fiscal Year” shall be references to the fiscal year of the Company.

4.2 Annual Bonus. For Fiscal 2010 and for each fiscal year thereafter that begins during the Employment Period (each such fiscal year, a “Bonus Year”), Executive shall be entitled to receive a bonus of up to 400% of the Base Salary (each, a “Bonus”) based upon attainment of annual quantitative and qualitative performance goals for the Company. In the event of an acquisition, the Bonus performance goals shall be determined with respect to the operations of Clothiers only. If earned, the Bonus may be payable in cash or a combination of cash and equity, provided that not less than 150% of Base Salary shall be payable as a cash Bonus to the extent earned. The Bonus, or portion thereof, payable in cash (the “Cash Bonus”) and the portion of the Bonus payable in equity, if any, (the “Equity Bonus”) shall be determined by the Compensation Committee not later than 90 days following the beginning of each Bonus Year. The earned Equity Bonus, if any, equal to the first 100% of Base Salary shall vest on the later to occur of (a) the first anniversary of the equity grant date or (b) the date on which the Compensation Committee shall determine the degree to which the performance goals have been met. One-half of any additional earned Equity Bonus shall vest on each of the second and third anniversaries of the grant date. The performance goals shall be established by the Compensation Committee in consultation with Executive as soon as possible following the beginning of each Bonus Year, but in no event later than 90 days following the beginning of each Bonus Year. It is the intention of the parties hereto that the Bonus shall meet the criteria for “performance-based compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (“Code”). The relationship between the size of each Bonus and degree of attainment of performance objectives shall be discretionary with the Compensation Committee. The Bonus earned for any Bonus Year shall be payable promptly following the determination thereof after the end of the Bonus Year, but in no event later than two and one-half (2¹/2) months following the end of each Bonus Year. Notwithstanding anything to the contrary contained herein or in the Employer’s Bonus Plan, in the event (y) the Employment Period shall end for any reason whatsoever on a day prior to payment to Executive of a Bonus for the last full Bonus Year contained within the Employment Period, and (z) Executive would have been entitled to receive a Bonus for such last full Bonus Year had the Employment Period not ended — then Employer shall pay to Executive the Cash Bonus for such last full Bonus Year as and when such Cash Bonus would have been paid had the Employment Period not ended.

4.3 Car Allowance. Employer shall pay to Executive throughout the Employment Period a car allowance equal to $1,600 per month, which shall be in lieu of any expense reimbursement related to a car purchased or leased, repairs, insurance, or gas, oil or mileage charges.

4.4 Other Benefits. Throughout the Employment Period, subject to, and to the extent Executive is eligible under their respective terms, Executive shall be entitled to receive such fringe benefits as are, or are from time to time hereafter, generally provided by Employer to Employer’s senior management employees (other than those provided under or pursuant to separately negotiated individual employment agreements or arrangements) under any pension or retirement plan, disability plan or insurance, group life insurance, medical and dental insurance, travel accident insurance, stock option, phantom stock or other similar plan or program of employer. Executive’s Base Salary shall (where applicable) constitute the compensation on the basis of which the amount of Executive’s benefits under any such plan or program shall be fixed and determined. If, during the Employment Period, any plan or program in which Executive participates shall be amended so as to result in overall reduction of Executive’s benefits, or shall be terminated without being replaced by a new plan or program providing for benefits equivalent overall to those provided for Executive prior thereto, the Company shall make arrangements, in addition to any such amended or terminated plan or program, for Executive to participate in a plan or program so as to provide benefits to Executive at least equivalent overall to those provided to Executive prior to such amendment or termination, such benefits to be provided through a plan or program of insurance if commercially available.

4.5 Expense Reimbursement. Employer shall reimburse Executive for all business expenses, including car rental expense while traveling on Employer business, reasonably incurred by him in the performance of his duties under this Agreement and consistent with past practice upon his presentation, not less frequently than monthly, of signed, itemized accounts of such expenditures, all in accordance with Employer’s procedures and policies as adopted and in effect from time to time and applicable to its senior management employees.

4.6 Vacations. Executive shall be entitled to 20 business days of vacation during each calendar year, which shall accrue in accordance with the Company’s vacation policy in effect from time to time for its senior executive officers, with reasonable carry-over allowances, which vacations shall be taken at such time or times as shall not unreasonably interfere with Executive’s performance of his duties under this Agreement. Upon termination of Executive’s employment pursuant to Section 5 herein, for any reason whatsoever, Employer shall pay Executive, in addition to any termination compensation provided for under Section 6 herein, an amount equivalent to Executive’s per diem compensation at the then-current Base Salary rate multiplied by the number of unused vacation days, including any carry-over, accrued by Executive as of the date of termination.

5. Termination of Employment Period

5.1 Termination without Cause. Employer or Executive may, by delivery of not less than 60 days’ notice to the other at any time during the Employment Period, terminate the Employment Period without cause.

5.2 By Employer for Cause. Employer may, at any time during the Employment Period by notice to Executive in accordance with and only after full compliance with the procedure set forth herein terminate the Employment Period “for cause” effective immediately. For the purposes hereof, “for cause” means:

(i) the conviction of Executive in a court of competent jurisdiction of a crime constituting a felony in such jurisdiction involving money or other property of Employer or any of its affiliates or any other felony or offense involving moral turpitude; or

(ii) the willful (a) commission of an act not approved of or ratified by the Board involving a material conflict of interest or self-dealing relating to any material aspect of the Company’s business or affairs; or (b) commission of an act of fraud or misrepresentation (including the omission of material facts), provided that such acts relate to the business of the Company and would materially and negatively impact upon the Company; or (c) material failure of Executive to obey directions of the Board that are consistent with Executive’s status as Chief Executive Officer; however, for the purposes of this subsection 5.2 (ii), the refusal of Executive to comply with an order or directive of anyone other than the majority of the Board, or the refusal of Executive to perform an act which is contrary to his duties, responsibilities and/or authority as Chief Executive Officer or is unlawful shall not constitute “for cause”. In the event of an act or omission as provided for in this subsection 5.2 (ii), Employer shall provide Executive with a written notice of intent to terminate the Employment Period “for cause”, setting forth, with reasonable particularity, the reasons and acts or omissions constituting “cause” under this subsection, and shall provide Executive with at least thirty (30) calendar days after such notice to cure or eliminate the problem or violation giving rise to such cause or any longer period as reasonably needed by Executive, provided that it is susceptible of cure or elimination and Executive is proceeding diligently and in good faith to cure such violation. In the event and only after the Executive fails to cure the problem or violation within the period provided for herein, Employer may exercise its rights to terminate the Employment Period in accordance with the procedure set forth below.

Termination “for cause” shall be effected only if (A) Employer has delivered to Executive of a written notice of termination “for cause”, setting forth, with reasonable particularity, the reasons for such “for cause” termination, (B) Employer has provided Executive with, on at least ten (10) business days’ prior written notice, in the case of a termination pursuant to subsection 5.2(ii), the opportunity, together with Executive’s counsel, to be heard before Employer’s Board, said hearing to occur at such reasonable time and place that is mutually convenient to Executive, his counsel, and Employer, and (C) the Board (after such notice and opportunity to be heard has been provided to Executive in the case of a termination pursuant to subsection 5.2(ii)) adopts a resolution concurred in by not less than majority of all of the directors of Employer then in office, including at least two-thirds of all of the directors who are not officers of Employer, that Executive was guilty of conduct constituting “for cause” hereunder, which conduct has not been cured (if applicable), and specifying the particulars thereof in detail.

5.3 By Executive for Good Reason. Executive may, at any time during the Employment Period by notice to Employer, terminate the Employment Period under this Agreement for “good reason” effective immediately. For the purposes hereof, “good reason” means any material breach by Employer of any provision of this Agreement which, if susceptible of being cured, is not cured within 30 days of delivery of notice thereof to Employer by Executive; it being agreed, however, that the cure period applicable to any failure timely to pay (or any reduction in) compensation or benefits paid or payable to Executive pursuant to the provisions of Section 4 hereof shall be limited to seven days after delivery of notice thereof to Employer. Without limitation of the generality of the foregoing, each of the following shall be deemed to be a material breach of this Agreement by Employer: (x) any failure timely to pay (or any reduction in) compensation (including benefits) paid or payable to Executive pursuant to the provisions of Section 4 hereof; (y) any reduction in the duties, responsibilities or perquisites of Executive as provided in Section 3.1 hereof and (z) any transfer of the Company’s principal executive offices outside the geographic area described in Section 3.2 hereof or requirement that Executive principally perform his duties in other than such office. The parties acknowledge and agree that as of the date hereof, no event has occurred giving Executive “good reason” to terminate the Employment Period. The parties further acknowledge that a material breach owing to the failure to timely pay compensation or benefits to Executive was never intended to include an administrative or ministerial lapse by Employer resulting in an inadvertent delay of such payment and that the foregoing seven day cure period will serve to permit the Employer to correct such a lapse.

5.4 By Executive for a Change of Control. Executive may terminate the Employment Period under this Agreement as a result of a “change of control” of Clothiers (at any time prior to an acquisition) or Holding (at anytime following an acquisition) (the “Entity”) immediately upon notice to Employer given not more than ninety (90) days following the date upon which Executive becomes aware of such change in control.

For purposes of this Agreement, a “change of control” shall, as more fully set forth in the Original Employment Agreement, generally be deemed to have occurred in the event (a) any person is or becomes the beneficial owner of a majority of the outstanding securities of the Entity; (b) any person is or becomes the beneficial owner of 30% or more of the outstanding securities of the Entity combined with a change in a majority of the members of the Board; or (c) of a merger, consolidation or liquidation of the Entity or a sale of all or substantially all of such the Entity’s assets.

5.5 Disability. During the Employment Period, if, as a result of physical or mental incapacity or infirmity (including alcoholism or drug addiction), Executive shall be unable to perform his material duties under this Agreement for (i) a continuous period of at least 180 days, or (ii) periods aggregating at least 270 days during any period of 12 consecutive months (each a “Disability Period”), and at the end of the Disability Period there is no reasonable probability that Executive can promptly resume his material duties hereunder pursuant hereto, Executive shall be deemed disabled (the “Disability”) and Employer, by notice to Executive, shall have the right to terminate the Employment Period for Disability at, as of or after the end of the Disability Period. The existence of the Disability shall be determined by a reputable, licensed physician mutually selected by Employer and Executive, whose determination shall be final and binding on the parties; provided, that if Employer and Executive cannot agree upon such physician, such physician shall be designated by the then acting President of the Baltimore City Medical Society, and if for any reason such President shall fail or refuse to designate such physician, such physician shall, at the request of either party, be designated by the American Arbitration Association. Executive shall cooperate in all reasonable respects to enable an examination to be made by such physician.

5.6 Death. The Employment Period shall end on the date of Executive’s death.

6. Termination Compensation; Non-Compete

6.1 Termination Without Cause, for Good Reason or Change of Control. If the Employment Period is terminated by Employer pursuant to the provisions of Section 5.1 or by Executive pursuant to the provisions of Sections 5.3 or 5.4 hereof, Employer will pay to Executive, (a) on the last day of the Employment Period a lump sum of $1,550,000, plus (b) if applicable, the earned Cash Bonus for the last full Bonus Year contained in the Employment Period pursuant to Section 4.2. Employer shall have no obligation to continue any other benefits provided for in Section 4 past the date of termination.

6.2 Certain Other Terminations. If the Employment Period is terminated (a) by Employer pursuant to the provisions of Section 5.2 at any time prior to, or more than 90 days after, a change of control of the Company, (b) by Executive pursuant to Section 5.1, (c) as a result of a Disability pursuant to the provisions of Section 5.5, or (d) as a result of the death of Executive pursuant to the provisions of Section 5.6., Employer shall pay to Executive, (x) within 60 days after the date of termination, a lump sum equal to any unpaid annual Base Salary through the date of termination, (y) in the case of termination for Disability or by death pursuant to the provisions of Section 5.5 or 5.6, when due pursuant to the provisions of Section 4.2 the earned Cash Bonus for the Bonus Year in which the date of termination occurred (assuming any personal goals not related to Company-wide performance were met) multiplied by a fraction, the numerator of which shall be the number of days of the Employment Period within the Bonus Year and the denominator of which shall be 365 and (z) if applicable, the earned Cash Bonus for the last full Bonus Year contained in the Employment Period pursuant to Section 4.2. Employer shall have no obligation to continue any other benefits provided for in Section 4 past the date of termination.

6.3 Expiration with Severance.

6.3.1 If (a) Employer fails to offer to Executive at least a one year renewal or extension of the Employment Period on its then current terms by no later than August 1 of the last year of the Employment Period and (b) the Employment Period shall thereafter expire on its then stated expiration date ((a) and (b) collectively, a “Term Expiration”), Employer will pay to Executive, (y) on the date of termination, a lump sum of $775,000 and (z) if applicable, the earned Cash Bonus for the Bonus Year ending on the stated expiration date of the Employment Period pursuant to and at the time otherwise payable under Section 4.2. Employer shall have no obligation to continue any other benefits provided in Section 4 past the date of termination.

6.3.2 Pursuant to the Jos. A. Bank Clothiers, Inc. 2010 Equity Incentive Plan (the “Equity Incentive Plan”), Employer has granted to Executive, and may in the future grant to Executive, the opportunity to earn certain performance-based Restricted Stock Units (“RSUs”), including, without limitation, the grant made pursuant to that certain CEO Performance Restricted Stock Unit Award Agreement, dated June 17, 2010 (the “June 2010 Agreement”). Notwithstanding anything to the contrary contained in the Equity Incentive Plan or in any award agreement providing for the grant and vesting of performance-based RSUs to Executive pursuant thereto (including, but not limited to the June 2010 Agreement) (each, an “Award Agreement”), for purposes of each Award Agreement, if the Executive is then willing and able to continue his employment with the Company on the then current terms and/or execute a new agreement providing terms and conditions substantially similar to those in this Employment Agreement and continue providing such services at the time of the Term Expiration, such Term Expiration shall be deemed a termination of this Employment Agreement (and Executive’s employment) by Employer without cause and (a) if the Term Expiration occurs on the last day of the Performance Period or after the end of the Performance Period but, in either case, prior to the Certification Date, upon certification by the Compensation Committee or the Board of Directors of the Earned Award on the Certification Date, Executive will be credited with such Earned Award and shall be deemed to have fully vested in such Earned Award on the First Vesting Date and (b) if the Term Expiration occurs on or after the Certification Date, Executive will be deemed to have fully vested in such Earned Award, and all vesting restrictions will lapse upon the termination of this Agreement.

The timing of any RSU payments hereunder shall be subject to the provisions of the June 2010 Agreement, including, without limitation, Sections 3 and 13 thereof, and any provisions in future Award Agreements addressing the timing of payments and matters under Section 409A of the Internal Revenue Code, as applicable. Capitalized terms used in this Section 6.3.2 but not defined in this Agreement will have those definitions attributed to them in the Award Agreement(s). This Section 6.3.2 shall be deemed an amendment of the June 2010 Agreement.

6.4 No Other Termination Compensation. Executive shall not, except as set forth in this Section 6 and in Section 4.6, be entitled to any compensation following termination of the Employment Period, except as may be otherwise provided in any equity award (e.g. stock options or restricted stock units) granted by Employer to Executive.

6.5 Mitigation. Executive shall not be required to mitigate the amount of any payments or benefits provided for hereunder upon termination of the Employment Period by seeking employment with any other person, or otherwise, nor shall the amount of any such payments or benefits be reduced by any compensation, benefit or other amount earned by, accrued for or paid to Executive as the result of Executive’s employment by or consultancy or other association with any other person.

6.6 Non-compete. For the purposes of this Agreement, “not compete” (or words of similar effect) shall mean that Executive shall not, directly or indirectly (a) engage in any activities that are in competition with the Company in any geographic area within 50 miles of the location of any Company store (owned or franchised) as of the date of termination of Executive (b) engage in any catalog business that focuses on the sale of men’s clothing, (c) solicit any customer of the Company or (d) solicit any person who is then employed by the Company or was employed by the Company within one year of such solicitation to (i) terminate his or her employment with the Company, (ii) accept employment with anyone other than the Company, or (iii) in any manner interfere with the business of the Company. If the Employment Period is terminated (x) by Executive pursuant to the provisions of Section 5.4 hereof; (y) by Employer pursuant to the provisions of Section 5.1 hereof; or (z) by Executive pursuant to the provisions of Section 5.3 hereof, Executive shall not compete with the Company for a period of two years from the date of termination. If the Employment Period is terminated by the Employer pursuant to the provisions of Section 5.2, Executive shall not compete with the Company for a period of six months from the date of termination. If the Employment Period expires and Executive is entitled to severance pursuant to Section 6.3, Executive shall not compete with the Company for a period of one year from the date of expiration. Executive acknowledges and agrees that in the event of any violation or threatened violation by Executive by his obligations under this section, Employer shall be entitled to injunctive relief without any necessity to post bond. Executive acknowledges and agrees that the Company’s catalog business is competitive with retail store businesses offering similar product lines.

6.7 Section 409A. It is the intent of this Agreement to comply with the requirements of Section 409A of the Code, and any ambiguities herein will be interpreted and this agreement will be administered to so comply.

(i) Termination Payments. If any compensation to be paid to Executive under Section 6 is “nonqualified deferred compensation” subject to Code Section 409A, such compensation shall be paid no earlier than the date of Executive’s “separation from service” from the Company within the meaning of Code Section 409A(a)(2)(A)(i). If the Executive is a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i) at the time of the Executive’s termination of employment, any nonqualified deferred compensation subject to Section 409A that would otherwise have been payable as a result of, and within the first six (6) months following, the Executive’s “separation from service”, and not by reason of another event under Section 409A(a)(2)(A), will become payable six (6) months and one (1) day following the date of the Executive’s separation from service or, if earlier, the date of Executive’s death.

(ii) Reimbursements. Consistent with the requirements of Section 409A of the Code, to the extent that any reimbursement or in-kind benefit provided to Executive under Sections 4.5 and 8.2 is taxable, unless stated otherwise: (i) reimbursements and in-kind benefits will be provided only during the employee’s employment with the Employer; (ii) the expenses eligible for reimbursement or the in-kind benefits provided in any given calendar year will not affect the expenses eligible for reimbursement or the in-kind benefits provided in any other calendar year; (iii) the reimbursement of an eligible expense must be made no later than the last day of calendar year following the calendar year in which the expense was incurred; and (iv) the right to reimbursements or in-kind benefits cannot be liquidated or exchanged for any other benefit.

7. Indemnification

The Company shall indemnify and hold Executive harmless from and against any expenses (including attorneys’ fees of the attorneys selected by Executive to represent him, which shall be advanced as incurred), judgments, fines and amounts paid in settlement incurred by him by reason of his being made a party or threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal administrative or investigative, by reason of any act or omission to act by Executive during or before the Employment Period or otherwise by reason of the fact that he is or was a director or officer of Employer of any subsidiary or affiliate included as a part of the Company, to the fullest extent and in the manner set forth and permitted by the General Corporation Law of the State of Delaware and any other applicable law as from time to time in effect. The provisions of this Section 7 shall survive any termination of the Employment Period or any deemed termination of this Agreement.

8. Miscellaneous

8.1 Notices. All notices required or permitted to be given hereunder shall be in writing and shall be (a) sent by certified mail-return receipt requested, postage prepaid, (b) personally delivered (via overnight delivery or otherwise), or (c) transmitted by facsimile. Notices shall be deemed delivered as follows: (a) three days after deposit with the United States Postal Service by certified mail; (b) one business day after deposit with a nationally-recognized overnight delivery service; (c) on the date of delivery when sent by local, commercial delivery service; or (d) on the date of transmission if sent by facsimile during the hours of 9:00 a.m. to 5:00 p.m. on a business day, or on the next following business day if sent by facsimile other than during such time. Notwithstanding anything to the contrary contained herein, notices shall be deemed to have been given when received or refused by the party to which or whom it was sent or delivered and any writing actually received by the party to which or whom it is addressed (regardless of the means of delivery) shall be sufficient notice hereunder. Notices shall be addressed as follows, provided that either party may, at any time, in the manner set forth for giving notices to the other, establish a different address to which notices to it or him shall be sent:


If to Employer:		Jos. A. Bank Clothiers, Inc.
		500 Hanover Pike
		Hampstead, Maryland 21704
		Attn: Chief Financial Officer

With copy to:		Jos. A. Bank Clothiers, Inc.
		500 Hanover Pike
		Hampstead, Maryland 21704
		Attn: General Counsel

If to Executive:		Mr. R. Neal Black
		2 Calvary Court
		Lutherville, Maryland 21093

8.2 Legal Fees. The Company shall pay the reasonable legal fees and expenses incurred by Executive in connection with preparation, negotiation, executive and delivery of this Agreement (not to exceed $5,000), as well as such fees and expenses incurred in connection with any amendment or modification hereof or enforcement of Executive’s rights hereunder.

8.3 Taxes. Employer is authorized to withhold (from any compensation or benefits payable hereunder to Executive) such amounts for income tax, social security unemployment compensation and other taxes as shall be necessary or appropriate in the reasonable judgment of Employer to comply with applicable laws and regulations.

8.4 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Maryland, without regard to any conflicts of law jurisprudence. Executive hereby consents to the jurisdiction of the state courts of the State of Maryland and the United States District Court for District of Maryland over all claims arising under this Agreement.

8.5 Arbitration. Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in Baltimore, Maryland in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitration award in any court having jurisdiction; PROVIDED, HOWEVER, that Executive shall be entitled to seek specific performance of his right to be paid until expiration of the Employment Period during the pendency of any arbitration.

8.6 Headings. All descriptive headings in this Agreement are inserted for convenience only and shall be disregarded in construing or applying any provision of this Agreement.

8.7 Counterparts. This Agreement may be executed by facsimile and/or in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

8.8 Severability. If any provision of this Agreement, or any part thereof, is held to be unenforceable, the remainder of such provision and this Agreement, as the case may be, shall nevertheless remain in full force and effect.

8.9 Entire Agreement and Representations. This Agreement contains the entire agreement and understanding between Employer and Executive with respect to the subject matter hereof. No representations or warranties of any kind or nature relating to the Company or its several businesses, or relating to the Company’s assets, liabilities, operations, future plans or prospects have been made by or on behalf of Employer to Executive. This Agreement supersedes any prior agreement between the parties relating to the subject matter hereof.

8.10 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors, heirs (in the case of Executive) and assigns.

8.11 Termination of Prior Employment Agreements. Effective upon the commencement of the Employment Period, Employer and Executive hereby terminate that certain Employment Agreement, dated as of December 21, 1999, as amended, pursuant to which Executive was employed by Employer. This Agreement amends and restates in its entirety the Original Employment Agreement, which, except as otherwise set forth in Section 5.4, shall hereafter have no further force or effect.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.


EMPLOYER:		EXECUTIVE:
JOS. A. BANK CLOTHIERS, INC.

By:	/s/ SIDNEY H. RITMAN	/s/ R. NEAL BLACK

	Sidney H. Ritman, Chairman	R. NEAL BLACK
	Compensation Committee

EX-10.2 3 c05556exv10w2.htm EXHIBIT 10.2 Exhibit 10.2

EXHIBIT 10.2

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (“Agreement”) is made this 30^th day of August, 2010, by and between Jos. A. Bank Clothiers, Inc., a Delaware corporation (the “Company”), and Robert B. Hensley (“Indemnitee”).

WHEREAS, at the request of the Company, Indemnitee currently serves as an officer of the Company and may, therefore, be subjected to claims, suits or proceedings arising as a result of his service; and

WHEREAS, as an inducement to Indemnitee to continue to serve as such officer, the Company has agreed to indemnify and to advance expenses and costs incurred by Indemnitee in connection with any such claims, suits or proceedings, to the maximum extent permitted by law; and

WHEREAS, the parties by this Agreement desire to set forth their agreement regarding indemnification and advance of expenses;

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

Section 1. Definitions. For purposes of this Agreement:

(a) “Change in Control” means a change in control of the Company occurring after the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if, after the Effective Date (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 15% or more of the combined voting power of all of the Company’s then-outstanding securities entitled to vote generally in the election of directors without the prior approval of at least two-thirds of the members of the Board of Directors in office immediately prior to such person’s attaining such percentage interest; (ii) the Company is a party to a merger, consolidation, sale of assets, plan of liquidation or other reorganization not approved by at least two-thirds of the members of the Board of Directors then in office, as a consequence of which members of the Board of Directors in office immediately prior to such transaction or event constitute less than a majority of the Board of Directors thereafter; or (iii) at any time, a majority of the members of the Board of Directors are not individuals (A) who were directors as of the Effective Date or (B) whose election by the Board of Directors or nomination for election by the Company’s stockholders was approved by the affirmative vote of at least two-thirds of the directors then in office who were directors as of the Effective Date or whose election for nomination for election was previously so approved.

(b) “Corporate Status” means the status of a person as a present or former director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company. As a clarification and without limiting the circumstances in which Indemnitee may be serving at the request of the Company, service by Indemnitee shall be deemed to be at the request of the Company if Indemnitee serves or served as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise (i) of which a majority of the voting power or equity interest is owned directly or indirectly by the Company or (ii) the management of which is controlled directly or indirectly by the Company.

(c) “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification and/or advance of Expenses is sought by Indemnitee.

(d) “Effective Date” means the date set forth in the first paragraph of this Agreement.

(e) “Expenses” means any and all reasonable and out-of-pocket attorneys’ fees and costs, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, ERISA excise taxes and penalties and any other disbursements or expenses incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in or otherwise participating in a Proceeding. Expenses shall also include Expenses incurred in connection with any appeal resulting from any Proceeding including, without limitation, the premium, security for and other costs relating to any cost bond, supersedeas bond or other appeal bond or its equivalent.

(f) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement or of other indemnitees under similar indemnification agreements), or (ii) any other party to or participant or witness in the Proceeding giving rise to a claim for indemnification or advance of Expenses hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

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(g) “Proceeding” means any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other proceeding, whether brought by or in the right of the Company or otherwise and whether of a civil (including intentional or unintentional tort claims), criminal, administrative or investigative (formal or informal) nature, including any appeal therefrom, including those pending or completed on or before the Effective Date. If Indemnitee reasonably believes that a given situation may lead to or culminate in the institution of a Proceeding, such situation shall also be considered a Proceeding.

Section 2. Services by Indemnitee. Indemnitee will serve as an officer of the Company. However, this Agreement shall not impose any independent obligation on Indemnitee or the Company to continue Indemnitee’s service to the Company. This Agreement shall not be deemed an employment contract between the Company (or any other entity) and Indemnitee.

Section 3. General. The Company shall indemnify, and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) otherwise to the maximum extent permitted by Delaware law in effect on the Effective Date and as amended from time to time; provided, however, that no change in Delaware law shall have the effect of reducing the benefits available to Indemnitee hereunder based on Delaware law as in effect on the Effective Date. The rights of Indemnitee provided in this Section 3 shall include, without limitation, the rights set forth in the other sections of this Agreement, including any additional indemnification permitted by Section 145 (including subsection (f)) of the Delaware General Corporation Law (the “DGCL”).

Section 4. Proceedings Other Than Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4 if, by reason of his Corporate Status, he is, or is threatened to be, made a party to or a witness in any threatened, pending, or completed Proceeding, other than a Proceeding by or in the right of the Company. Pursuant to this Section 4, Indemnitee shall be indemnified against all judgments, penalties, fines and amounts paid in settlement and all Expenses actually and reasonably incurred by him or on his behalf in connection with a Proceeding by reason of his Corporate Status if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and, with respect to a criminal Proceeding, had no reasonable cause to believe his conduct was unlawful.

Section 5. Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 5 if, by reason of his Corporate Status, he is, or is threatened to be, made a party to or a witness in any threatened, pending or completed Proceeding brought by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 5, Indemnitee shall be indemnified against all amounts paid in settlement and all Expenses actually and reasonably incurred by him or on his behalf in connection with such Proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and except that no indemnification shall be made in respect of any Proceeding where the Indemnitee has been adjudged to be liable to the Company.

Section 6. Court-Ordered Indemnification. Notwithstanding any other provision of this Agreement, the Court of Chancery of the State of Delaware or the court in which such action or suit was brought may determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for any claim, issue or matter.

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Section 7. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provision of this Agreement, and without limiting any such provision, to the extent that Indemnitee was or is, by reason of his Corporate Status, made a party to (or otherwise becomes a participant in) any Proceeding and is successful, on the merits or otherwise, in the defense of such Proceeding, Indemnitee shall be indemnified for all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee under this Section 7 for all Expenses actually and reasonably incurred by him or on his behalf in connection with each such claim, issue or matter, allocated on a reasonable and proportionate basis. For purposes of this Section 7 and, without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

Section 8. Advance of Expenses for a Party. If, by reason of Indemnitee’s Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall, without requiring a preliminary determination of Indemnitee’s ultimate entitlement to indemnification hereunder, advance all reasonable Expenses incurred by or on behalf of Indemnitee in connection with such Proceeding within ten days after the receipt by the Company of a statement or statements requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall set forth in reasonable detail the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by a written undertaking by or on behalf of Indemnitee, in substantially the form attached hereto as Exhibit A or in such form as may be required under applicable law as in effect at the time of the execution thereof, to reimburse the portion of any Expenses advanced to Indemnitee relating to any claim, issue or matter in the Proceeding as to which it is ultimately determined that the Indemnitee is not entitled to be indemnified and which has not been successfully resolved as described in Section 7 of this Agreement. To the extent that Expenses advanced to Indemnitee do not relate to a specific claim, issue or matter in the Proceeding, such Expenses shall be allocated on a reasonable and proportionate basis. The undertaking required by this Section 8 shall be an unlimited general obligation by or on behalf of Indemnitee and shall be accepted without reference to Indemnitee’s financial ability to repay such advanced Expenses and without any requirement to post security therefor.

Section 9. Indemnification and Advance of Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is or may be, by reason of his Corporate Status, made a witness or otherwise required to participate in any Proceeding, whether instituted by the Company or any other party, and to which Indemnitee is not a party, he shall be advanced all reasonable Expenses and indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith within ten days after the receipt by the Company of a statement or statements requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall set forth in reasonable detail the Expenses incurred by Indemnitee.

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Section 10. Procedure for Determination of Entitlement to Indemnification.

(a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. Indemnitee may submit one or more such requests from time to time and at such time(s) as Indemnitee deems appropriate in his sole discretion. The officer of the Company receiving any such request from Indemnitee shall, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification.

(b) Upon written request by Indemnitee for indemnification pursuant to Section 10(a) above, a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall promptly be made in the specific case: (i) if a Change in Control shall have occurred, by Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee, which Independent Counsel shall be selected by the Indemnitee and approved by the Board of Directors in accordance with Section 145(d)(3) of the DGCL, which approval will not be unreasonably withheld or delayed; or (ii) if a Change in Control shall not have occurred, (A) by the Board of Directors by a majority vote of a quorum consisting of Disinterested Directors, (B) by a majority vote of a committee of Disinterested Directors designated by a majority of Disinterested Directors even if less than a quorum, (C) if Independent Counsel has been selected by the Board of Directors in accordance with Section 145(d)(3) of the DGCL and approved by the Indemnitee, which approval shall not be unreasonably withheld or delayed, by Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee or (D) if so directed by the Board of Directors, by the stockholders of the Company. If it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten days after such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination in the discretion of the Board of Directors or Independent Counsel if retained pursuant to clause (ii)(B) of this Section 10(b). Any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company shall indemnify and hold Indemnitee harmless therefrom.

Section 11. Presumptions; Effect of Certain Proceedings; No Imputed Knowledge; Pleading.

(a) In making any determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 10(a) of this Agreement, and the Company shall have the burden of proof to overcome that presumption in connection with the making of any determination contrary to that presumption.

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(b) The knowledge and/or actions, or failure to act, of any other director, officer, employee or agent of the Company or any other director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise shall not be imputed to Indemnitee for purposes of determining any other right to indemnification under this Agreement.

(c) In any Proceeding with respect to entitlement to indemnification, the Company shall have the burden of pleading with particularity or providing a detailed writing setting forth the alleged factual basis for each defense to Indemnitee’s claim for indemnification and, without limiting the generality of the foregoing, the pleading or writing filed by the Company objecting to the granting of indemnification shall be verified and shall set forth a detailed statement of the time and place of any act, omission or statement by Indemnitee, or others, which allegedly supports any such defense.

Section 12. Remedies of Indemnitee.

(a) If (i) a determination is made pursuant to Section 10(b) of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advance of Expenses is not timely made pursuant to Section 8 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10(b) of this Agreement within 60 days after receipt by the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to Section 7 of this Agreement within ten days after receipt by the Company of a written request therefor, or (v) payment of indemnification pursuant to any other section of this Agreement or the charter or Bylaws of the Company is not made within ten days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication by the Court of Chancery of the State of Delaware or in any other court of competent jurisdiction of his entitlement to such indemnification or advance of Expenses. Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence a proceeding seeking an adjudication or an award in arbitration within 180 days following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 12(a); provided, however, that the foregoing time limit shall not apply to a proceeding brought by Indemnitee to enforce his rights under Section 7 of this Agreement. Except as set forth herein, the provisions of Delaware law (without regard to its conflicts of laws rules) shall apply to any such arbitration. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

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(b) In any judicial proceeding or arbitration commenced pursuant to this Section 12, Indemnitee shall be presumed to be entitled to indemnification or advance of Expenses, as the case may be, under this Agreement and the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be. If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 12, Indemnitee shall not be required to reimburse the Company for any advances pursuant to Section 8 of this Agreement until a final determination is made with respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed). The Company shall, to the fullest extent not prohibited by law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all of the provisions of this Agreement.

(c) If a determination shall have been made pursuant to Section 10(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 12, absent a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification.

(d) In the event that Indemnitee, pursuant to this Section 12, seeks a judicial adjudication of or an award in arbitration to enforce his rights under, or to recover damages for breach of, this Agreement, Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Company for, any and all Expenses actually and reasonably incurred by him or on his behalf in such judicial adjudication or arbitration. If it shall be determined in such judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advance of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be paid on a reasonable and proportionate basis.

(e) Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to be charged for judgments under Delaware law for amounts which the Company pays or is obligated to pay for the period commencing with the date on which the Company was requested to advance expenses in accordance with Section 8 of this Agreement or to make the determination of entitlement to indemnification under Section 12(a) above and ending on the date such payment is made to Indemnitee by the Company.

Section 13. Defense of the Underlying Proceeding.

(a) Indemnitee shall notify the Company promptly in writing upon being served with any summons, citation, subpoena, complaint, indictment, request or other document relating to any Proceeding which may result in the right to indemnification or the advance of Expenses hereunder and shall include with such notice a description of the nature of the Proceeding and a summary of the facts underlying the Proceeding. The failure to give any such notice shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advance of Expenses under this Agreement unless the Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance policy is materially and adversely prejudiced thereby, and then only to the extent the Company is thereby actually so prejudiced.

-7-

(b) Subject to the provisions of the last sentence of this Section 13(b) and of Section 13(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which may give rise to indemnification hereunder; provided, however, that the Company shall notify Indemnitee of any such decision to defend within 15 calendar days following receipt of notice of any such Proceeding under Section 13(a) above. The Company shall not, without the prior written consent of Indemnitee, which shall not be unreasonably withheld or delayed, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of such Proceeding, which release shall be in form and substance reasonably satisfactory to Indemnitee, or (iii) would impose any Expense, judgment, fine, penalty or limitation on Indemnitee. This Section 13(b) shall not apply to a Proceeding brought by Indemnitee under Section 12 of this Agreement.

(c) Notwithstanding the provisions of Section 13(b) above, if in a Proceeding to which Indemnitee is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval shall not be unreasonably withheld or delayed, that he may have separate defenses or counterclaims to assert with respect to any issue which may not be consistent with other defendants in such Proceeding, (ii) Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval shall not be unreasonably withheld or delayed, that an actual or apparent conflict of interest or potential conflict of interest exists between Indemnitee and the Company, or (iii) if the Company fails to assume the defense of such Proceeding in a timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of Indemnitee’s choice, subject to the prior approval of the Company, which shall not be unreasonably withheld or delayed, at the expense of the Company. In addition, if the Company fails to comply with any of its obligations under this Agreement or in the event that the Company or any other person takes any action to declare this Agreement void or unenforceable, or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of Indemnitee’s choice, subject to the prior approval of the Company, which shall not be unreasonably withheld or delayed, at the expense of the Company (subject to Section 12(d) of this Agreement), to represent Indemnitee in connection with any such matter.

Section 14. Non-Exclusivity; Survival of Rights; Subrogation.

(a) The rights of indemnification and advance of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation or Bylaws of the Company, any agreement or a resolution of the Board of Directors or of the stockholders entitled to vote generally in the election of directors, or otherwise. Unless consented to in writing by Indemnitee, no amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or repeal, regardless of whether a claim with respect to such action or inaction is raised prior or subsequent to such amendment, alteration or repeal. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right or remedy shall be cumulative and in addition to every other right or remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion of any right or remedy hereunder, or otherwise, shall not prohibit the concurrent assertion or employment of any other right or remedy.

-8-

(b) In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

Section 15. Coordination of Payments. The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

Section 16. Exception to Right of Indemnification or Advance of Expenses. Notwithstanding any other provision of this Agreement, Indemnitee shall not be entitled to indemnification or advance of Expenses hereunder if the Proceeding was brought by Indemnitee unless: (i) the Proceeding was brought to enforce indemnification under this Agreement, and then only to the extent in accordance with and as authorized by Section 12 of this Agreement, or (ii) the Company’s Certificate of Incorporation or Bylaws, a resolution of the Board of Directors or of the stockholders entitled to vote generally in the election of directors or an agreement approved by the Board of Directors to which the Company is a party expressly provide otherwise.

Section 17. Insurance. The Company will use its reasonable best efforts to acquire directors and officers liability insurance, on terms and conditions deemed appropriate by the Board of Directors, with the advice of counsel, covering Indemnitee or any claim made against Indemnitee by reason of his Corporate Status and covering the Company for any indemnification or advance of Expenses made by the Company to Indemnitee for any claims made against Indemnitee by reason of his Corporate Status. Without in any way limiting any other obligation under this Agreement, the Company shall indemnify Indemnitee for any payment by Indemnitee arising out of the amount of any deductible or retention and the amount of any excess of the aggregate of all judgments, penalties, fines, settlements and Expenses incurred by Indemnitee in connection with a Proceeding over the coverage of any insurance referred to in the previous sentence. The purchase, establishment and maintenance of any such insurance shall not in any way limit or affect the rights or obligations of the Company or Indemnitee under this Agreement except as expressly provided herein, and the execution and delivery of this Agreement by the Company and the Indemnitee shall not in any way limit or affect the rights or obligations of the Company under any such insurance policies. If, at the time the Company receives notice from any source of a Proceeding to which Indemnitee is a party or a participant (as a witness or otherwise) the Company has director and officer liability insurance in effect, the Company shall give prompt notice of such Proceeding for itself and on behalf of the Indemnitee to the insurers in accordance with the procedures set forth in the respective policies.

-9-

Section 18. Duration of Agreement; Binding Effect.

(a) This Agreement shall continue until and terminate on the later of (i) the date that Indemnitee shall have ceased to serve as a director, officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company and (ii) the date that Indemnitee is no longer subject to any actual or possible Proceeding (including any rights of appeal thereto and any Proceeding commenced by Indemnitee pursuant to Section 12 of this Agreement).

(b) The indemnification and advance of Expenses provided by, or granted pursuant to, this Agreement shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company, and shall inure to the benefit of Indemnitee and his spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.

(c) The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

(d) The Company and Indemnitee agree herein that a monetary remedy for breach of this Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which he may be entitled. Indemnitee shall further be entitled to such specific performance and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertakings in connection therewith. The Company acknowledges that, in the absence of a waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company hereby waives any such requirement of such a bond or undertaking.

-10-

Section 19. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

Section 20. Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. One such counterpart signed by the party against whom enforceability is sought shall be sufficient to evidence the existence of this Agreement.

Section 21. Headings. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

Section 22. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

Section 23. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed or (ii) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed:

(a) If to Indemnitee, to the address set forth on the signature page hereto.

(b) If to the Company, to:


		Jos. A. Bank Clothiers, Inc.
		Attn:		Charles D. Frazer
				Senior Vice President-General Counsel
		500 Hanover Pike
		Hampstead, Maryland 21074-2095
		United States of America

or to such other address as may have been furnished in writing to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

-11-

Section 24. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflicts of laws rules.

Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.


COMPANY: JOS. A. BANK CLOTHIERS, INC.,
By:	/s/ CHARLES D. FRAZER
	Name:	Charles D. Frazer
	Title:	Senior Vice President-General Counsel


	INDEMNITEE
	/s/ ROBERT B. HENSLEY
	Name:	Robert B. Hensley
	Address:	500 Hanover Pike Hampstead, MD 21704

-12-

EXHIBIT A

FORM OF UNDERTAKING TO REPAY EXPENSES ADVANCED

To: The Board of Directors of Jos. A. Bank Clothiers, Inc.

Re: Undertaking to Repay Expenses Advanced

Ladies and Gentlemen:

This undertaking is being provided pursuant to that certain Indemnification Agreement dated the _____ day of , 2009, by and between Jos. A. Bank Clothiers, Inc., a Delaware corporation (the “Company”), and the undersigned Indemnitee (the “Indemnification Agreement”), pursuant to which I am entitled to advance of expenses in connection with [ ] (the “Proceeding”).

Terms used herein and not otherwise defined shall have the meanings specified in the Indemnification Agreement.

I am subject to the Proceeding by reason of my Corporate Status or by reason of alleged acts or omissions by me in such capacity. In consideration of the advance by the Company of Expenses incurred by me in connection with the Proceeding (the “Advanced Expenses”), I hereby agree that if, in connection with the Proceeding, it is ultimately determined that I am not entitled to be indemnified, then I shall promptly reimburse the portion of the Advanced Expenses relating to the claims, issues or matters in the Proceeding as to which I am not entitled to indemnification and which have not been successfully resolved as described in Section 7 of the Indemnification Agreement. To the extent that Advanced Expenses do not relate to a specific claim, issue or matter in the Proceeding, I agree that such Expenses shall be allocated on a reasonable and proportionate basis.

IN WITNESS WHEREOF, I have executed this Undertaking on this _____ day of , 20_____.

A-1

EX-10.3 4 c05556exv10w3.htm EXHIBIT 10.3 Exhibit 10.3

EXHIBIT 10.3

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (“Agreement”) is made this 30^th day of August, 2010, by and between Jos. A. Bank Clothiers, Inc., a Delaware corporation (the “Company”), and Charles D. Frazer (“Indemnitee”).

WHEREAS, the parties by this Agreement desire to set forth their agreement regarding indemnification and advance of expenses;

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

Section 1. Definitions. For purposes of this Agreement:

(d) “Effective Date” means the date set forth in the first paragraph of this Agreement.

-2-

-3-

-4-

Section 10. Procedure for Determination of Entitlement to Indemnification.

Section 11. Presumptions; Effect of Certain Proceedings; No Imputed Knowledge; Pleading.

-5-

Section 12. Remedies of Indemnitee.

-6-

Section 13. Defense of the Underlying Proceeding.

-7-

Section 14. Non-Exclusivity; Survival of Rights; Subrogation.

-8-

-9-

Section 18. Duration of Agreement; Binding Effect.

-10-

(a) If to Indemnitee, to the address set forth on the signature page hereto.

(b) If to the Company, to:


		Jos. A. Bank Clothiers, Inc.
		Attn:		David E. Ullman
				Executive Vice President-Chief Financial Officer
		500 Hanover Pike
		Hampstead, Maryland 21074-2095
		United States of America

or to such other address as may have been furnished in writing to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

-11-

Section 24. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflicts of laws rules.

Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.


COMPANY: JOS. A. BANK CLOTHIERS, INC.,
By:	/s/ DAVID E. ULLMAN
	Name:	David E. Ullman
	Title:	Executive Vice President-Chief Financial Officer

INDEMNITEE
/s/ CHARLES D. FRAZER
Name: Charles D. Frazer
Address: 500 Hanover Pike Hampstead, MD 21704

-12-

EXHIBIT A

FORM OF UNDERTAKING TO REPAY EXPENSES ADVANCED

To: The Board of Directors of Jos. A. Bank Clothiers, Inc.

Re: Undertaking to Repay Expenses Advanced

Ladies and Gentlemen:

Terms used herein and not otherwise defined shall have the meanings specified in the Indemnification Agreement.

IN WITNESS WHEREOF, I have executed this Undertaking on this _____ day of , 20_____.

A-1

EX-10.4 5 c05556exv10w4.htm EXHIBIT 10.4 Exhibit 10.4

EXHIBIT 10.4

SEVENTH AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS SEVENTH AMENDMENT (this “Amendment”) is made as of the 17^th day of June, 2010 to that certain AMENDED AND RESTATED EMPLOYMENT AGREEMENT, dated as of May 15, 2002, as amended (collectively, the “Employment Agreement”), by and between CHARLES D. FRAZER (“Employee”) and JOS. A. BANK CLOTHIERS, INC. (“Employer”).

FOR GOOD AND VALUABLE CONSIDERATION, the receipt and adequacy of which are hereby acknowledged, Employer and Employee, being the sole parties to the Employment Agreement, hereby amend the Employment Agreement and agree as follows:

1. Subject to earlier termination as otherwise set forth in the Employment Agreement, the last day of the Employment Period shall be January 28, 2012.

2. Effective on the day on which general salary increases, if any, become effective for other employees of the Employer for fiscal 2010, Employee’s Base Salary shall be $280,000.

Except as specifically amended hereby, the Employment Agreement shall remain in full force and effect according to its terms. To the extent of any conflict between the terms of this Amendment and the terms of the remainder of the Employment Agreement, the terms of this Amendment shall control and prevail. Capitalized terms used but not defined herein shall have those respective meanings attributed to them in the Employment Agreement. This Amendment shall hereafter be deemed a part of the Employment Agreement for all purposes.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written.

JOS. A. BANK CLOTHIERS, INC.

EX-31.1 6 c05556exv31w1.htm EXHIBIT 31.1 Exhibit 31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002

I, R. Neal Black, certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Jos. A. Bank Clothiers, 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(s) 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

The registrant’s other certifying officer(s) 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.


Date: September 1, 2010	/s/ R. Neal Black
	R. Neal Black
	President, Chief Executive Officer and Director

EX-31.2 7 c05556exv31w2.htm EXHIBIT 31.2 Exhibit 31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002

I, David E. Ullman, certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Jos. A. Bank Clothiers, 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(s) 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

	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.


Date: September 1, 2010	/s/ David E. Ullman
	David E. Ullman
	Chief Financial Officer

EX-32.1 8 c05556exv32w1.htm EXHIBIT 32.1 Exhibit 32.1

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Jos. A. Bank Clothiers, Inc. (the “Company”) on Form 10-Q for the period ended July 31, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, R. Neal Black, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 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.


September 1, 2010	/s/ R. Neal Black
	R. Neal Black
	President, Chief Executive Officer and Director

EX-32.2 9 c05556exv32w2.htm EXHIBIT 32.2 Exhibit 32.2

Exhibit 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Jos. A. Bank Clothiers, Inc. (the “Company”) on Form 10-Q for the period ended July 31, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David E. Ullman, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 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.


September 1, 2010	/s/ David E. Ullman
	David E. Ullman
	Chief Financial Officer

-----END PRIVACY-ENHANCED MESSAGE-----

/s/ R. Neal Black

/s/ CHARLES D. FRAZER

R. Neal Black,

CHARLES D. FRAZER

President-Chief Executive Officer