A three bonus day at Coach…

images7.jpegYesterday, Coach (COH) announced that President and Chief Operating Officer Keith Monda would be stepping down at the end of June and that Limited Brands (LTD) executive Jerry Stritzke would be succeeding him. The release also noted that Reed Krakoff, Coach’s creative director, was extending his contract for another three years to 2014.

What the press release didn’t say is that Krakoff, who last time we footnoted him was using some of his Coach stock to buy a “significant townhouse in NYC” that caught fire a year later, will receive as much as $10 million in “extension bonuses” as long as he stays at Coach through July 2010. That part was in the 8K filed yesterday. The filing notes that if Krakoff is fired for cause or resigns for other than “good reason”, he’ll have to pay back that money. In addition to the extension bonuses, the filing also includes details on both “service bonuses” and “additional bonuses” for Krakoff. That’s three bonuses in the space of two paragraphs.

But perhaps even more interesting is that Krakoff’s current contract was not due to expire until July 2011, which raises the question of why extend it now. Was he being wooed by another company three years before his contract was set to expire at Coach? Yesterday’s filing also provides no information on what Monda will get upon his retirement, given the fact that as we footnoted here, Coach extended all three top executive’s contracts in September 2005. But going all the way back to the original contract seems to indicate that Monda, who plans to remain on Coach’s board, is likely to be paid through 2011.