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SALANT CORPORATION
1996 STOCK PLAN
SECTION 1. Establishment, Purpose, and Effective Date of Plan
1.1 Establishment. Salant Corporation, a Delaware corporation
(the "Company"), hereby establishes the "1996 STOCK PLAN" (the "Plan") for key
employees and directors. The Plan permits the grant of Stock Options, Stock
Appreciation Rights and Restricted Stock.
1.2 Purpose. The purpose of the Plan is to advance the interests
of the Company and its Subsidiaries and promote continuity of management by
encouraging and providing key employees and directors with the opportunity to
acquire an equity interest in the Company and to participate in the increase in
shareholder value as reflected in the growth in the price of the shares of the
Company's Stock and by enabling the Company to attract and retain the services
of key employees and directors upon whose judgment, interest, skills, and
special effort the successful conduct of its operations is largely dependent.
1.3 Effective Date. The Plan shall become effective on
May 15, 1996.
SECTION 2. Definitions; Construction
2.1 Definitions. Whenever used herein, the following
terms shall have their respective
meanings set forth below:
(a) "Act" means the Securities Exchange Act of
1934, as amended.
(b) "Board" means the Board of Directors of the
Company.
(c) A "Change in Control" means a change in control of
a nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A promulgated under
the Act, as amended; provided that, without limitation, such a
change in control shall be deemed to have occurred (i) if,
during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board (the
"Continuing Directors") cease for any reason to constitute at
least two-thirds thereof, unless the election or nomination for
election by the Company's stockholders of each new director was
approved by a vote of at least two-thirds of the directors then
in office who were then Continuing Directors, (ii) when the
Company acquires actual knowledge that any person (as such term
is used in Sections 13(d) and 14(d)(2) of the Act) (other than
an employee benefit plan of the Company or any Subsidiary, or
trustee thereof, acting on behalf of such plan) is or has become
the beneficial owner (as such term is defined in Rule 13d-3
promulgated under the Act) directly or indirectly, of securities
of the Company representing 25% or more of the outstanding
shares of the Company's capital stock entitled to vote generally
in the election of directors, (iii) upon any purchase pursuant
to a tender or exchange offer, which purchase results in a
person (as such term is used in Sections 13(d) and 14(d)(2) of
the Act) (other than an employee benefit plan of the Company or
any Subsidiary, or trustee thereof, acting on behalf of such
plan) beneficially owning, directly or indirectly, 25% or more
of the outstanding shares of the Company's capital stock
entitled to vote generally in the election of directors, (iv)
upon the approval by the Company's stockholders of (A) a merger
or consolidation of the Company with or into another corporation
(other than a merger or consolidation in which the Company is
the surviving corporation and which does not result in any
reclassification or reorganization of the Company's then
outstanding shares of common stock), (B) a sale or disposition
of all or substantially all of the Company's assets or (C) a
plan of liquidation or dissolution of the Company; provided,
however, that the acquisition of Stock by Apollo Apparel
Partners, Inc. shall not constitute a "Change of Control" under
this Plan.
(d) "Cause" - mean an Eligible Employee's (i)
commission of an act of fraud or intentional misrepresentation
or an act of embezzlement, misappropriation or conversion of
assets or opportunities of the Company or any Subsidiary, (ii)
intentional failure to perform reasonably assigned duties, (iii)
dishonesty or willful misconduct in the performance of duties,
(iv) involvement in a transaction in connection with the
performance of duties to the Company or any of its Subsidiaries
thereof which transaction is adverse to the interests of the
Company or any of its Subsidiaries and which is engaged in for
personal profit or (v) willful violation of any law, rule or
regulation in connection with the performance of duties (other
than traffic violations or similar offenses).
(e) "Change in Capitalization" means any increase or
reduction in the number of shares of Stock, or any change
(including, but not limited to, a change in value) in the shares
of Stock or exchange of shares of Stock for a different number
or kind of shares or other securities of the Company or any
other corporation or other entity, by reason of a
reclassification, recapitalization, merger, consolidation,
reorganization, spin-off, split-up, issuance of warrants or
rights or debentures, stock dividend, stock split or reverse
stock split, extraordinary dividend, property dividend,
combination or exchange of shares or otherwise.
(f) "Code" means the Internal Revenue Code of
1986, as amended.
(g) "Committee" means a committee of the Board
designated to administer the Plan which shall consist of two or
more members of the Board each of whom is "disinterested" within
the meaning of Rule 16b-3 under the Act and an Outside Director.
(h) "Company" means Salant Corporation,
a Delaware corporation.
(i) "Director Option" means an Option granted to
a Nonemployee Director pursuant to Section 6.
(j) "Disability" shall have the meaning assigned to the
terms "total disability" or "totally disabled" in the Salant
Corporation long-term disability program for salaried employees,
provided the Participant remains totally disabled for six
consecutive months; or, if the Company does not maintain a
long-term disability program, an individual shall have a
"Disability" if he is unable to engage in any substantial
activity by reason of any medically determinable, physical or
mental impairment that can be expected to result in death or
which has lasted or can be expected to last for a continuous
period of not less than 12 months.
(k) "Eligible Employee" means any person
designated by the Committee as eligible to
participate in the Plan pursuant to Section 3.1.
(l) "Employee Option" means an Option granted to
an Eligible Employee pursuant to Section 7.
(m) "Fair Market Value" means the mean between the
highest and lowest sale price of the Stock for the date in
question, as published in The Wall Street Journal for such date,
or, if no sale prices are quoted in The Wall Street Journal for
such date, for the next preceding date for which such sale
prices are quoted.
(n) "Nonemployee Director" means a director of
the Company who is not otherwise an
employee or consultant of the Company or any Subsidiary.
(o) "Option" means the right to purchase Stock at a
stated price for a specified period of time. For purposes of the
Plan an Option may be either (i) an "incentive stock option"
within the meaning of Section 422 of the Code or (ii) a
"nonstatutory stock option."
(p) "Option Price" means the price at which an
Option states Stock may be purchased.
(q) "Optionee" means a person to whom an Option
has been granted under the Plan.
(r) "Outside Director" means a member of the Board who
is an "outside director" within the meaning of Section 162(m) of
the Code and the regulations promulgated thereunder.
(s) "Participant" means an Eligible Employee or
Nonemployee Director who has been granted and, at the time of
reference, holds an Option or share of Restricted Stock.
(t) "Period of Restriction" means the period during
which the transfer of shares of Restricted Stock is restricted
pursuant to Section 10 of the Plan.
(u) "Restricted Stock" means Stock granted to an
Eligible Employee pursuant to
Section 10 of the Plan.
(v) "Retirement" shall have the meaning assigned to
such term in the Salant Corporation Retirement Plan, or if such
plan is not in effect, such term shall mean the termination of
employment with the Company by reason of the attainment of the
age which the Company, by policy or otherwise, has established
as the age at which salaried employees may or shall be required
to terminate their employment and receive retirement benefits.
(w) "Stock" means the Common Stock of the Company,
par value of $1.00 per share.
(x) "Stock Appreciation Right" means the right to
receive the increase in the value of Stock subject to an Option
in lieu of purchasing such Stock.
(y) "Subsidiary" means any present or future
subsidiary of the Company, as defined
in Section 424(f) of the Code.
2.2 Number. Except when otherwise indicated by the
context, the singular shall include the
plural, and the plural shall include the singular.
SECTION 3. Eligibility and Participation
3.1 Eligibility and Participation. Eligible Employees in the
Plan shall be selected by the Committee from among those officers and other key
employees of the Company and its Subsidiaries who, in the opinion of the
Committee, are in a position to contribute materially to the Company's continued
growth and development and to its long-term financial success. All Nonemployee
Directors shall participate in the Plan in accordance with Section 6.
SECTION 4. Stock Subject to Plan
4.1 Number. The total number of shares of Stock subject to
issuance under the Plan may not exceed 600,000; provided, however, that the
maximum number of shares of Stock subject to an Option (whether or not connected
with Stock Appreciation Rights) granted to any Eligible Employee may not exceed
150,000. The total number of shares of Stock that may be awarded under the Plan
and the maximum number of shares of Stock that may be awarded to any Eligible
Employee are subject to adjustment upon occurrence of any of the events
indicated in Subsection 4.4. The shares to be delivered under the Plan may
consist, in whole or in part, of authorized but unissued Stock or treasury
Stock, not reserved for any other purpose.
4.2 Unused Stock; Unexercised Rights. In the event any shares of
Stock are subject to an Option, which for any reason, expires or is terminated
unexercised as to such shares, or any shares of Stock, subject to a Restricted
Stock grant made under the Plan are reacquired by the Company pursuant to
Section 10 of the Plan, such shares again shall become available for issuance
under the Plan.
4.3 Exercise of Stock Appreciation Right. Whenever a Stock
Appreciation Right is exercised and payment of the amount determined in
Subsection 9.1(b) is made in cash, the shares of Common Stock allocable to the
portion of the Option surrendered may again be the subject of Options and Awards
hereunder. Whenever a Stock Appreciation Right is exercised and payment of the
amount determined in Subsection 9.1(b) is made in shares of Common Stock, no
shares of Common Stock with respect to which the Stock Appreciation Right is
exercised may again be the subject of Options and Awards hereunder.
4.4 Adjustment in Capitalization.
(a) In the event of a Change in Capitalization, the
Committee shall conclusively determine the appropriate
adjustments, if any, to the (i) maximum number and class of
shares of Stock or other securities with respect to which
Options or Restricted Stock may be granted under the Plan or to
any individual, (ii) the number and class of shares of Stock or
other securities which are subject to Director Options issuable
under Section 6; and (iii) the number and class of shares of
Stock or other securities which are subject to outstanding
Options or Awards granted under the Plan, and the purchase price
therefor, if applicable.
(b) Any such adjustment in the shares of Stock or other
securities subject to outstanding incentive stock options
(including any adjustments in the purchase price) shall be made
in such manner as not to constitute a modification as defined by
Section 424(h)(3) of the Code and only to the extent otherwise
permitted by Sections 422 and 424 of the Code.
(c) Any stock adjustment in the shares of Stock or
other securities subject to outstanding Director Options
(including any adjustments in the purchase price) shall be made
only to the extent necessary to preserve, without exceeding, the
value of such Director Option.
(d) If, by reason of a Change in Capitalization, a
grantee of Restricted Stock shall be entitled to, or an Optionee
shall be entitled to exercise an Option or Stock Appreciation
Rights with respect to, new, additional or different shares of
stock or securities, such new, additional or different shares
shall thereupon be subject to all of the conditions,
restrictions and performance criteria which were applicable to
the Restricted Stock, or shares of Stock or Stock Appreciation
Rights subject to the Option, as the case may be, prior to such
Change in Capitalization.
SECTION 5. Duration of Plan
5.1 Duration of Plan. The Plan shall remain in effect, subject
to the Board's right to earlier terminate the Plan pursuant to Subsection 13.3
hereof, until all Stock subject to it shall have been purchased or acquired
pursuant to the provisions hereof. Notwithstanding the foregoing, no Option or
Restricted Stock may be granted under the Plan on or after May 14, 2006.
SECTION 6. Option Grants for Nonemployee Directors.
6.1 Grant.
(a) Initial Grant. An initial grant of Director
Options shall be made to each
Nonemployee Director upon the date the individual becomes
a Nonemployee Director (an "Initial
Grant").
(b) Annual Grant. Director Options shall be granted in
each year that the Plan is in effect to (i) each Nonemployee
Director who participated in the Salant Corporation 1993 Stock
Plan (the "1993 Stock Plan") on each anniversary (or the next
business day if such anniversary is not a business day) of the
"First Initial Grant Date," as that term is defined in the 1993
Stock Plan, and (ii) each other Nonemployee Director on each
anniversary (or the next business day if such anniversary is not
a business day) of his Initial Grant (each an "Annual Grant");
provided, however, that no Annual Grant shall be made to a
Nonemployee Director unless such person has been a director of
the Company for at least six months prior to the date of grant.
6.2 Option Agreement. Each Director Option shall be evidenced by
an Option Agreement that shall reflect the Option Price, the duration of the
Option, the number of shares of Stock to which the Option pertains, all as
specified in this Section 6, and such other terms and conditions not
inconsistent with the provisions of this Plan as determined by the Board;
provided that such terms shall not vary the timing of awards of Director
Options, including provisions dealing with forfeitures or termination of such
Director Options.
Director Options shall be nonstatutory stock options.
6.3 Number of Shares. Each Initial Grant shall be in respect of
a number of shares of Stock equal to 1,000 (in each case adjusted
proportionately pursuant to Section 4.4), less any shares of Stock being made as
an "Initial Grant" at the same time pursuant to Section 6.1(a) of the 1993 Stock
Plan, and each Annual Grant shall be in respect of a number of shares of Stock
equal to 300 (in each case adjusted proportionately pursuant to Section 4.4),
less any shares of Stock being made as an "Annual Grant" at the same time
pursuant to section 6.1(b) of the 1993 Stock Plan.
6.4 Option Price. The Option Price for shares of Stock under
each Director Option shall be equal to 100% of the Fair Market Value of a share
of Stock on the date the Director Option is granted.
6.5 Duration of Director Options. Director Options shall
be for a term of ten years.
6.6 Vesting. Director Options shall be exercisable
in whole or in part at any time from the
date of grant thereof.
6.7 Amendments. Notwithstanding anything in this Plan to the
contrary, neither the provisions in this Section 6 nor any other provision of
the Plan to the extent it relates to Director Options may be amended more than
once every six months, other than to comport with changes in the Code, the
Employee Retirement Income Security Act of 1974, as amended, or the rules and
regulations thereunder, if such an amendment would cause any Nonemployee
Director to be other than a "disinterested" person within the meaning of Rule
16b-3 under the Act or would cause the provisions of the Plan relating to the
granting of Director Options to fail to qualify under Rule 16b-3(c)(2)(ii) of
the Act.
SECTION 7. Option Grants for Eligible Employees
7.1 Grant of Employee Options. Subject to the provisions of
Sections 4 and 5, Employee Options may be granted to Eligible Employees at any
time and from time to time as shall be determined by the Committee. The
Committee shall have complete discretion in determining whether to grant
Employee Options and, subject to Section 4.1, the number of Options granted to
each Eligible Employee. The Committee also shall determine whether an Employee
Option is to be an incentive stock option within the meaning of Section 422 of
the Code or a nonstatutory stock option. Nothing in this Section 7 of the Plan
shall be deemed to prevent the grant of nonstatutory stock options in excess of
the maximum established by Section 422 of the Code.
7.2 Option Agreement. Each Employee Option shall be evidenced by
an Option Agreement that shall specify the type of Option granted, the Option
Price, the duration of the Option, the number of shares of Stock to which the
Option pertains and such other provisions as the Committee shall determine.
7.3 Option Price. The Option Price for each Employee Option
shall be determined by, or in the manner specified by, the Committee; provided,
that no incentive stock option granted pursuant to the Plan shall have an Option
Price that is less than the Fair Market Value of the Stock on the date the
Option is granted (110% of Fair Market Value in the case of an incentive stock
option granted to any person who owns stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company or any
Subsidiary (a "Ten Percent Stockholder")).
7.4 Duration of Employee Options. Each Employee Option shall
expire at such time as the Committee shall determine at the time it is granted;
provided, however, that no Employee Option shall be exercisable later than the
tenth anniversary date of its grant (the fifth anniversary in the case of an
incentive stock option granted to a Ten Percent Stockholder).
7.5 Exercise of Employee Options. Employee Options granted under
the Plan shall be exercisable at such times and be subject to such restrictions
and conditions as the Committee shall in each instance approve, which need not
be the same for all Eligible Employees.
SECTION 8. Terms and Conditions Applicable to All Options.
8.1 Exercise. Options shall be exercised by an Optionee only by
a written notice delivered in person or by mail to the Secretary of the Company
at the Company's principal executive office, specifying the number of shares of
Stock with respect to which the Option is being exercised. If requested by the
Committee, the Optionee shall deliver the agreement evidencing the Option being
exercised to the Secretary of the Company who shall endorse thereon a notation
of such exercise and return such agreement to the Optionee. In addition, Options
may be exercised through a registered broker-dealer pursuant to such cashless
exercise procedures as are, from time to time, deemed acceptable by the
Committee.
8.2 Payment. The Option price upon exercise of any Option shall
be payable to the Company in full either (i) in cash or its equivalent, or (ii)
in the case of Employee Options, at the discretion of the Committee, and in the
case of Director Options, in all instances, by tendering shares of previously
acquired Stock having a Fair Market Value at the time of exercise equal to the
total Option Price or (iii) by a combination of (i) and (ii). The proceeds from
such a payment shall be added to the general funds of the Company and shall be
used for general corporate purposes.
8.3 Restrictions on Stock Transferability. The Committee may
impose such restrictions on any shares of Stock acquired pursuant to the
exercise of an Option under the Plan as it may deem advisable, including,
without limitation, restrictions under applicable Federal securities law, under
the requirements of any stock exchange upon which such shares of Stock are then
listed and under any blue sky or state securities laws applicable to such
shares.
8.4 Termination of Employment Due to Death or Disability. In the
event the employment of the Optionee is terminated by reason of death or
Disability, the Committee may provide in the Option Agreement, and in the event
the service as a Nonemployee Director is terminated by reason of death, the
Option Agreement shall provide, that any outstanding Options granted to the
Optionee shall become immediately exercisable and shall thereafter be fully
exercisable at any time prior to the expiration date of the Options or within
twelve months after the date of death or Disability, whichever period is the
shorter. In the event the employment of an Optionee who is an Employee is
terminated by reason of death or Disability and the Committee has made no
special provision in the Option Agreement, the rights under any then outstanding
Option granted to the Optionee pursuant to the Plan shall, to the extent not
then exercisable, terminate immediately and, to the extent then exercisable,
terminate upon the expiration date of the Option or sixty days after such date
of termination of employment, whichever first occurs.
8.5 Termination of Employment Due to Retirement. In the event
the employment of the Optionee is terminated by reason of Retirement, the rights
under any then outstanding Employee Option granted to the Optionee pursuant to
the Plan shall, to the extent not then exercisable, terminate immediately and,
to the extent then exercisable, terminate upon the expiration date of the Option
or three months after such date of termination of employment, whichever first
occurs, subject to such exceptions applicable only to Employee Options (which
shall be set forth in the Option Agreement) as the Committee may, in its sole
discretion, approve.
8.6 Termination of Employment Other than for Death, Disability
or Retirement. If the employment of the Optionee shall terminate for any reason
other than death, Disability or Retirement or, in the event the service of a
Nonemployee Director is terminated for any reason other than death, the rights
under any then outstanding Option granted to the Optionee pursuant to the Plan
shall, to the extent not then exercisable, terminate immediately and, to the
extent then exercisable, terminate upon the expiration date of the Option or
sixty days after such date of termination of employment or service, whichever
first occurs, subject to such exceptions applicable only to Employee Options
(which shall be set forth in the Option Agreement) as the Committee may, in its
sole discretion, approve. Notwithstanding the foregoing, if the employment of
the Optionee is terminated by the Company for Cause, any then outstanding Option
granted pursuant to the Plan to the Optionee shall terminate immediately upon
the termination of employment; provided, that the Committee may with respect to
Employee Options, in its sole discretion, waive, in whole or in part, the
automatic forfeiture of such Employee Options and may set forth such waiver or
condition in the Option Agreement or at any other time, including following the
termination of employment.
8.7 Nontransferability and Exercisability of Options. No Option
granted under the Plan may be sold, transferred, pledged, assigned or otherwise
alienated or hypothecated, otherwise than by will or by the laws of descent and
distribution. Further, all Options granted to an Optionee under the Plan shall
be exercisable during his lifetime only by such Optionee. Notwithstanding any
provision of the Plan to the contrary, no Option shall be exercisable prior to
the time a registration statement under the Securities Act of 1933 is effective
with respect to the shares of Stock issuable upon the exercise of such Option.
8.8 Modification. Subject to the terms of the Plan, the
Committee may modify outstanding Options or accept the surrender of outstanding
Options (to the extent not exercised) and grant new Options in substitution for
them. Notwithstanding the foregoing, no modification of an Option shall
adversely alter or impair any rights or obligations under the agreement granting
such Option without the Optionee's consent.
SECTION 9. Stock Appreciation Rights.
9.1 Stock Appreciation Rights. The Committee may, in its
discretion, in connection with the grant of an Employee Option, grant to the
Optionee Stock Appreciation Rights, the terms and conditions of which shall be
set forth in an Agreement. A Stock Appreciation Right shall cover the same
shares of Stock covered by the Option (or such lesser number of shares of Stock
as the Committee may determine) and shall, except as provided in this Section 9,
be subject to the same terms and conditions as the related Option. Stock
Appreciation Rights shall be subject to the following terms and provisions:
(a) A Stock Appreciation Right may be granted:
(i) either at the time of grant, or at any time thereafter
during the term of
the Option if related to a nonstatutory stock option; or
(ii) only at the time of grant if related to an
incentive stock option.
(b) A Stock Appreciation Right will entitle the holder
of the related Option, upon exercise of the Stock Appreciation
Right, to surrender such Option, or any portion thereof to the
extent unexercised, and to receive payment of an amount
determined by multiplying (i) the excess of the Fair Market
Value of a share of Stock on the date of exercise of such Stock
Appreciation Right over the purchase price of a share of Stock
under the related Option, by (ii) the number of shares as to
which such Stock Appreciation Right has been exercised.
Notwithstanding the foregoing, the Committee may limit in any
manner the amount payable with respect to any Stock Appreciation
Right by including such a limit in the agreement evidencing the
Stock Appreciation Right at the time it is granted.
(c) A Stock Appreciation Right will be exercisable at
such time or times and only to the extent that a related Option
is exercisable, and will not be transferable except to the
extent that such related Option may be transferable. A Stock
Appreciation Right granted in connection with an incentive stock
option shall be exercisable only if the Fair Market Value of a
share of Stock on the date of exercise exceeds the purchase
price of a share of Stock specified in the related Option.
(d) Upon the exercise of a Stock Appreciation Right,
the related Option shall be canceled to the extent of the number
of shares of Stock as to which the Stock Appreciation Right is
exercised, and upon the exercise of an Option granted in
connection with a Stock Appreciation Right, the Stock
Appreciation Right shall be canceled to the extent of the number
of shares of Stock as to which the Option is exercised or
surrendered.
(e) Stock Appreciation Rights shall be exercised by an
Optionee only by a written notice delivered in person or by mail
to the Secretary of the Company at the Company's principal
executive office, specifying the number of shares of Stock with
respect to which the Stock Appreciation Right is being
exercised. If requested by the Committee, the Optionee shall
deliver the agreement evidencing the Stock Appreciation Right
being exercised and the agreement evidencing any related Option
to the Secretary of the Company who shall endorse thereon a
notation of such exercise and return such agreement to the
Optionee.
(f) Payment of the amount determined under Subsection
(b) may be made in the discretion of the Committee, solely in
whole shares of Stock in a number determined at their Fair
Market Value on the date preceding the date of exercise of the
Stock Appreciation Right, or solely in cash, or in a combination
of cash and Stock. If the Committee decides to make full payment
in Stock and the amount payable results in a fractional share,
payment for the fractional share will be made in cash.
Notwithstanding the foregoing, no payment in the form of cash
may be made upon the exercise of a Stock Appreciation Right
pursuant to Subsection (b) to an individual who may be subject
to liability under Section 16(b) of the Exchange Act, unless the
exercise of such Stock Appreciation Right is made during the
period beginning on the third business day and ending on the
twelfth business day following the date of release for
publication of the Company's quarterly or annual statements of
sales and earnings.
(g) No Stock Appreciation Right may be exercised
before the date six months after
the date it is granted.
(h) Subject to the terms of the Plan, the Committee may
modify outstanding awards of Stock Appreciation Rights or accept
the surrender of outstanding awards of Stock Appreciation Rights
(to the extent not exercised) and grant new awards in
substitution for them. Notwithstanding the foregoing, no
modification of an award of Stock Appreciation Rights shall
adversely alter or impair any rights or obligations under the
agreement granting such Stock Appreciation Rights without the
Optionee's consent.
SECTION 10. Restricted Stock
10.1 Grant of Restricted Stock. Subject to the provisions of
Sections 4 and 5, the Committee, at any time and from time to time, may grant
shares of Restricted Stock under the Plan to such Eligible Employees and in such
amounts as it shall determine in its sole discretion. Each grant of Restricted
Stock shall be in writing.
10.2 Transferability. Except as provided in this Section 10, the
shares of Restricted Stock granted hereunder may not be sold, transferred,
pledged, assigned or otherwise alienated or hypothecated for such period of time
as shall be determined by the Committee and shall be specified in the Restricted
Stock grant, or upon earlier satisfaction of other conditions as specified by
the Committee in its sole discretion and set forth in the Restricted Stock
grant; provided that Restricted Stock granted to an individual who may be
subject to liability under Section 16(b) of the Exchange Act may not be sold for
at least six months after the date of grant.
10.3 Other Restrictions. The Committee may impose such other
restrictions on any shares of Restricted Stock granted to any Eligible Employee
pursuant to the Plan as it may deem advisable including, without limitation,
restrictions under applicable federal or state securities laws, and may legend
the certificates representing Restricted Stock to give appropriate notice of
such restrictions.
10.4 Certificate Legend. In addition to any legends placed on
certificates pursuant to Subsection 10.3 hereof, each certificate representing
shares of Restricted Stock granted pursuant to the Plan shall bear the following
legend:
"The sale or other transfer of the shares of stock
represented by this certificate, whether voluntary, involuntary
or by operation of law, is subject to certain restrictions on
transfer set forth in Salant Corporation's 1996 Stock Plan,
rules of administration adopted pursuant to such Plan and a
Restricted Stock grant dated . A copy of the Plan, such rules
and such Restricted Stock grant may be obtained from the
Secretary of Salant Corporation."
10.5 Removal of Restrictions. Except as otherwise provided in
this Section 10, shares of Restricted Stock covered by each Restricted Stock
grant made under the Plan shall become freely transferable by the Eligible
Employee after the last day of the Period of Restriction. Once the shares are
released from the restrictions, the Eligible Employee shall be entitled to have
the legend required by Subsection 10.4 removed from his Stock certificate.
10.6 Voting Rights. During the Period of Restriction,
Eligible Employees holding shares of
Restricted Stock granted hereunder may exercise full voting rights with
respect to those shares.
10.7 Dividends and Other Distributions. During the Period of
Restriction, Eligible Employees holding shares of Restricted Stock granted
hereunder shall be entitled to receive all dividends and other distributions
paid with respect to those shares while they are so held. If any such dividends
or distributions are paid in shares of Stock, the shares shall be subject to the
same restrictions on transferability as the shares of Restricted Stock with
respect to which they were paid.
SECTION 11. Beneficiary Designation.
11.1 Beneficiary Designation. Subject to Sections 8.7, 9.1(c)
and 10.2, each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of the Participant's death
before he or she receives any or all of such benefit. Each designation will
revoke all prior designations by the same Participant, shall be in a form
prescribed by the Committee and will be effective only when filed by the
Participant in writing with the Committee during the lifetime of the
Participant. In the absence of any such designation, benefits remaining unpaid
at the Participant's death shall be paid to the estate of the Participant.
SECTION 12. Rights of Employees and Directors
12.1 Employment. Nothing in the Plan shall interfere with or
limit in any way the right of the Company to terminate any Participant's
employment or service at any time nor confer upon any Participant any right to
continue in the employ or service of the Company.
12.2 Participation. No employee shall have a right to be
selected as an Eligible Employee or, having been so selected, to be selected
again as an Optionee or recipient of Restricted Stock. The preceding sentence
shall not be construed or applied so as to deny an employee any participation in
the Plan solely on the basis that the employee was a Participant in connection
with a prior grant of benefits under the Plan.
SECTION 13. Administration; Powers and Duties of the Committee
13.1 Administration. The Committee shall be responsible for the
administration of the Plan. The Committee, by majority action thereof, is
authorized to interpret the Plan, to prescribe, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions and assurances
deemed necessary or advisable to protect the interests of the Company, and to
make all other determinations necessary or advisable for the administration of
the Plan, but only to the extent not contrary to the express provisions of the
Plan. Determinations, interpretations, or other actions made or taken by the
Committee pursuant to the provisions of the Plan shall be final and binding and
conclusive for all purposes and upon all persons whomsoever. No member of the
Committee shall be personally liable for any action, determination or
interpretation made or taken with respect to the Plan and all members of the
Committee shall be fully indemnified by the Company with respect to any such
action, determination or interpretation.
13.2 Change in Control. Without limiting the authority of the
Committee as provided herein, the Committee, either at the time Employee Options
or shares of Restricted Stock are granted, or, if so provided in the applicable
Employee Option agreement or Restricted Stock grant, at any time thereafter,
shall have the authority to accelerate in whole or in part the exercisability of
Employee Options and/or the last day of the Period of Restriction upon a Change
in Control. The Employee Option agreements and Restricted Stock grants approved
by the Committee may contain provisions whereby, in the event of a Change in
Control, the acceleration of the exercisability of Employee Options and/or the
last day of the Period of Restriction may be automatic or may be subject to the
discretion of the Committee or may depend upon whether the Change in Control
shall be approved by a majority of the members of the Board or such other
criteria as the Committee may specify. Nothing herein shall obligate the
Committee to take any action upon a Change of Control.
13.3 Amendment, Modification and Termination of Plan. The Board
may at any time terminate, and from time to time may amend or modify the Plan,
provided, however, that no such action of the Board, without approval of the
stockholders, may:
(a) Increase the total amount of Stock which may be
issued under the Plan, except as provided in Subsections 4.1 and
4.3 of the Plan.
(b) Materially increase the cost of the Plan or
materially increase the benefits to Participants.
(c) Extend the period during which Options or
Restricted Stock may be granted.
(d) Extend the maximum period after the date of
grant during which Options may be exercised.
(e) Change the class of individuals eligible to
receive Options or Restricted Stock.
No amendment, modification or termination of the Plan shall in
any manner adversely affect any Options or Restricted Stock theretofore granted
to any Participant under the Plan, without the consent of that Participant.
SECTION 14. Tax Withholding
14.1 Tax Withholding. Whenever shares of Stock are to be issued
under the Plan, the Company shall have the power to require the recipient of the
Stock to remit to the Company an amount sufficient to satisfy federal, state and
local withholding tax requirements prior to issuance of the certificate for
shares of Stock.
SECTION 15. Requirements of Law.
15.1 Requirements of Law. The granting of Options or Restricted
Stock, and the issuance of shares of Stock upon the exercise of an Option shall
be subject to all applicable laws, rules and regulations, and to such approvals
by any governmental agencies or national securities exchanges as may be
required.
15.2 Governing Law. The Plan, and all agreements hereunder,
shall be construed in accordance with and governed by the laws of the State of
New York without giving effect to the choice of law principles thereof, except
to the extent that such law is preempted by federal law.