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July 18, 1997
Michael A. Lubin
767 Third Avenue
New York, N.Y. 10017
Dear Mike:
This letter (this "Letter Agreement") will confirm the
understanding between you and Lubin Delano & Company ("Lubin Delano"), on the
one hand and Salant Corporation, a Delaware corporation (together with all of
its subsidiaries and affiliates, "Salant") on the other hand, concerning your
separation of employment with Salant. Salant and you have mutually agreed as
follows:
1. Cancellation of Employment, Employment Agreement and Stock
Options. Subject to the Effective Date (as defined below), your employment with
Salant will end on July 31, 1997 (the "Separation Date"). As of the Separation
Date (i) the Employment Agreement dated February 11, 1997 (the "Employment
Agreement"), (ii) the Salant Corporation 1993 Stock Plan Nonstatutory Employee
Stock Option Agreement dated October 10, 1995 and, to the extent not therefore
exercised, all options thereunder, and (iii) the Letter Agreement dated December
1, 1995 between Salant and Lubin Delano (the "Lubin Delano Agreement") shall
each be considered null and void. At 6:00 P.M. eastern standard time, on
December 31, 1997, the Salant Corporation 1993 Stock Plan Nonstatutory Employee
Stock Option Agreement dated February 11, 1997 and all options thereunder (the
"1997 Options"), to the extent not therefore exercised, shall be considered null
and void.
2. Effective Date. The term "Effective Date" means the date that
Salant receives this Letter Agreement executed by you and you have not revoked
this Letter Agreement pursuant to Paragraph 16 herein. In the event that (i) you
fail to sign and return this Letter Agreement on or prior to August 15, 1997 or
(ii) you revoke the Letter Agreement pursuant to Paragraph 16 herein, the
Effective Date and this Letter Agreement shall be null and void.
3. Monetary Obligations. Subject to the Effective Date and your
continued performance and compliance with the terms of this Letter Agreement (i)
Salant shall continue to pay you your salary in effect on the date hereof and
pay Lubin Delano its consulting fee pursuant to the Lubin Delano Agreement, in
each case until July 31, 1997 and (ii) on the Effective Date Salant shall pay to
Lubin Delano a one-time lump sum payment of $368,149. Salant shall reimburse
Lubin Delano within ten (10) business days following submission thereof for
actual business expenses incurred by you or it on or prior to July 31, 1997 in
connection with the performance by you or Lubin Delano of services for Salant in
an amount not to exceed $_______. Until April 30, 1998 you agree to make
yourself available to Salant by phone for consultation from time to time.
4. Non-Disclosure and Covenant Not to Compete. (a) Both you and
Lubin Delano agree not to communicate with any person or entity, including
without limitation, any of Salant's creditors, customers, suppliers, licensors,
licensees or employees or any member of the press, about any proprietary or
confidential aspect of the business, prospects, operations or financial
condition of Salant, unless such communication is (i) authorized in writing by
the Board of Directors of Salant or any successor to Salant, or (ii) legally
required in the written opinion of counsel; provided that in the event you or
Lubin Delano are so required to disclose such confidential information, you or
Lubin Delano as the case may be, will give Salant at least ten (10) days' notice
(or shorter, but prompt, notice to the extent you are required to respond to
legal process in fewer than ten (10) days) prior to any disclosure of
confidential information, setting forth the reasons for the disclosure of the
confidential information, and you will not oppose any appropriate protective
order sought by Salant. Notwithstanding anything contained herein to the
contrary, you and Lubin Delano understand that Salant may be legally required to
disclose the existence and terms of this Letter Agreement.
(b) You covenant and agree that if at any time while the 1997
Options remain outstanding, you or Lubin Delano engage or take part in, whether
as owner, principal, agent, partner, officer, employee, independent contractor,
consultant, shareholder, licensor or otherwise, alone or in association with any
other person, either directly or indirectly, carry on, render services to or
own, share in the earnings of, or invest in the stocks, convertible bonds or
other convertible securities of, or be interested in any way in any business
competing with the businesses of Salant or its subsidiaries, as in existence on
the date hereof, without the written consent of the Board of Directors of Salant
(other than a passive investment in a business which is competitive with or
similar to any of the businesses of Salant if the investment is in securities
which are listed on a national securities exchange or NASDAQ and the investment
in any class of securities does not exceed 2% of the outstanding shares of such
class or 2% of the aggregate outstanding principal amount of such class, as the
case may be) the 1997 Options shall immediately be considered null and void. In
addition, until April 30, 1998, you covenant and agree that you will not,
directly or indirectly, (i) hire any person who is employed by Salant as of July
1, 1997 whose annual compensation on such date is equal to or greater than
$100,000 or (ii) solicit, induce, entice or hire any such person to leave the
employment of Salant.
5. Future Employment. You agree that you will neither seek nor
accept employment with Salant or any other company affiliated with Salant at any
time in the future. You understand and agree that by entering into this
Agreement, you waive the right to reinstatement of employment with Salant.
6. Proprietary Documents. All written materials, records and
documents made by you or coming into your possession during your employment by
Salant concerning the business or affairs of Salant are the sole property of
Salant and, prior to the Separation Date, you shall deliver the same to Salant.
7. Company Property. You agree that prior to the Separation
Date you will return any and all of
Salant's credit cards, cars, keys, office equipment, computers and any and all
other property of Salant.
8. Cooperation. You hereby agree that, at the request of Salant,
from time to time, on a reasonable basis, you will be available to Salant, its
counsel and accountants to discuss any aspects of Salant's businesses,
prospects, operations or financial condition with which you are familiar. Salant
agrees to reimburse you for all out-of-pocket expenses reasonably incurred by
you in connection with any activities you undertake at Salant's request.
9. Further Actions. From and after the date of this Letter
Agreement, you and Lubin Delano, on the one hand, and Salant, on the other hand,
shall, at the other party's request , execute and deliver all documents and
instruments and take such other action as the other party may reasonably request
in order to effect the transactions contemplated by this Letter Agreement. Each
of Salant and Lubin Delano represents and warrants that this Letter Agreement
has been duly and validly authorized, executed and delivered by it, and
constitutes a valid and binding obligation of each of Salant and Lubin Delano
enforceable in accordance with its terms.
10. Releases. (a) Effective as of the date hereof, but excluding
any liabilities or obligations of Salant arising under this Letter Agreement,
you hereby, on behalf of yourself, your heirs, administrators, executors,
forever release and discharge Salant and all other affiliates, divisions,
subsidiaries and each of their predecessors, successors, assigns, agents,
directors, officers, employees, representatives, attorneys, and all persons
acting by, through, under or in concert with any of them (collectively referred
to in this Paragraph 10 as "Salant") from any and all charges, claims, demands,
judgments, actions, causes of action, damages, expenses, costs, attorneys' fees,
and liabilities of any kind whatsoever, whether known or unknown, vested or
contingent, in law, equity or otherwise (collectively referred to as "Causes of
Action"), which you ever had, now have, or may hereafter have against Salant for
or on account of any matter, cause or thing whatsoever which has occurred at any
time up to the date of this Letter Agreement, including without limitation of
the generality of the foregoing, any and all rights or claims which are related
to your employment and separation from employment by Salant, and any and all
rights or claims which you have or may have under any law, rule or regulation,
including without limitation, Title VII of the Civil Rights Act of 1964, as
amended; the Civil Rights Act of 1991, as amended; the Age Discrimination in
Employment Act of 1967, as amended; the Employee Retirement Income Security Act,
as amended; 42 U.S.C. '1981, as amended; the Older Workers Benefit Protection
Act; the Americans with Disabilities Act; the Family and Medical Leave Act of
1993; or other state or municipal statutes or ordinances which regulate
employment; and the laws of contracts, torts, including but not limited to
intentional infliction of emotional distress, and other subjects. The release
set forth herein is in consideration of the receipt of the sum stated herein
which you acknowledge is in addition to anything of value to which you are
otherwise entitled. Nothing in this Letter Agreement shall be deemed an
admission of liability by Salant relating in any way to your employment by
Salant, the terms of your separation, or the obligations of Salant with respect
to any of the foregoing. Notwithstanding the foregoing, nothing in this Letter
Agreement shall be deemed to affect in any way (i) your or Lubin Delano's right
to seek indemnification or contribution from Salant in the event you or Lubin
Delano are hereafter the subject of any third-party claim or derivative claim on
behalf of Salant arising out of or relating to any act or omission by you or
Lubin Delano during the course of your employment by Salant or Lubin Delano's
engagement by Salant, to the extent such right would have otherwise existed or
(ii) any rights or assets which you may have with respect to pension, 401(K)
plan or other qualified plan under the Employment Retirement Income Security Act
of 1974 or under the Comprehensive Budget Reconciliation Act of 1985.
(b) Effective as of the date hereof, but excluding any of your
liabilities or obligations arising under this Letter Agreement, Salant, on
behalf of itself, its affiliates, and subsidiaries and their respective
successors and assigns, forever releases and discharges you, and your respective
heirs, administrators, executors, relatives, affiliates, subsidiaries,
predecessors, successors, assigns, representatives, attorneys, and all persons
acting by, through, under or in concert with any of them (collectively referred
to in the paragraph 10(b) as "you") from any and all Causes of Action, which
Salant or any one or more of them ever had, now has, or may hereafter have
against you for or on account of any matter, cause or thing whatsoever which has
occurred at any time up to the date of this Letter Agreement, including without
limitation of the generality of the foregoing, any and all rights or claims
which are related to your employment and separation from employment from Salant,
and any and all rights or claims which Salant or any of the foregoing persons
has or may have under any law, rule or regulation, state or municipal statutes
or ordinances, and the laws of contracts, torts and other subjects. The release
set forth herein is in consideration of the execution and delivery of this
Letter Agreement by you which Salant acknowledges is in addition to anything of
value to which it is otherwise entitled. Nothing in this Letter Agreement shall
be deemed an admission of liability by you or any of the foregoing persons
relating in any way to your relationship with Salant, the terms of your
separation, or your obligations that you or any of the foregoing persons with
respect to any of the foregoing. Notwithstanding anything contained herein to
the contrary, you are not released and Salant reserves its rights in law, equity
or otherwise, from any and all Causes of Action which are a result of or
predicted on conduct described in Section 2(b) of the Employment Agreement.
11. Entire Agreement; Amendments. This Letter Agreement embodies
the entire agreement and understanding between you and Salant and supersedes all
prior agreements and understandings relating to the subject matter hereof. No
amendment, waiver, modification or discharge of any of the terms of this Letter
Agreement shall be valid unless in writing and signed by the party against which
enforcement is sought.
12. Successors and Assigns. This Letter Agreement shall be binding
upon and inure to the benefit of the successors, assigns, representatives,
affiliates, parents, subsidiaries, heirs, executors and administrators of the
parties hereto and their officers, directors, stockholders, employees, servants
and agents.
13. Governing Law; Submission to Jurisdiction. The validity,
performance and enforcement of this Letter Agreement shall be governed by the
internal laws of the State of New York. For purposes of any action or proceeding
involving this Agreement, you, Lubin Delano and Salant hereby expressly submit
to the jurisdiction of all federal and state courts of competent jurisdiction
sitting within the area comprising the Southern District of New York on the date
of this Letter Agreement and consent to service of any process or papers by
registered mail or by personal service within or without the State of New York.
14. Headings. The headings of the various sections hereof are
for convenience of reference only
and will not modify any of the terms or provisions of this Letter Agreement.
15. Method of Notice. All notices or other communications required
to be given pursuant to this Letter Agreement shall be in writing and shall be
mailed, by registered or certified mail, return receipt requested, and shall be
addressed as follows:
a) if to Salant:
Salant Corporation
1114 Avenue of the Americas
New York, New York 10036
Attn: Todd M. Kahn
Vice President and General Counsel
b) if to Michael A. Lubin or Lubin Delano
Michael A. Lubin
c/o Lubin, Delano & Company
767 Third Avenue
New York, N.Y. 10017
Any party may, from time to time, change its address for future notices and
other communications hereunder by giving notice in the manner described herein
to the other party hereto.
16. Revocation Period. YOU UNDERSTAND THAT YOU HAVE TWENTY-ONE (21)
DAYS WITHIN WHICH TO CONSIDER AND SIGN THIS AGREEMENT AND THAT YOU MAY REVOKE
THIS AGREEMENT BY WRITTEN NOTICE SENT IN ACCORDANCE WITH PARAGRAPH 15 HEREIN,
ANY TIME BEFORE THE EXPIRATION OF SEVEN (7) DAYS FOLLOWING EXECUTION OF THIS
AGREEMENT.
THIS AGREEMENT SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION
PERIOD HAS EXPIRED.
17. Acknowledgement. YOU ACKNOWLEDGE THAT SALANT HAS ADVISED YOU
TO CONSULT WITH AN ATTORNEY PRIOR
TO THE EXECUTION OF THIS AGREEMENT. YOU FURTHER ACKNOWLEDGE THAT YOU HAVE HAD
THE
OPPORTUNITY TO ASK QUESTIONS ABOUT EACH AND EVERY PROVISION OF THIS
AGREEMENT AND THAT YOU FULLY UNDERSTAND THE EFFECT OF THE PROVISIONS CONTAINED
HEREIN UPON YOUR LEGAL RIGHTS. SALANT ACKNOWLEDGES THAT YOU HAVE CONSULTED WITH
AND BEEN ADVISED BY NIXON, HARGRAVE, DEVANS & DOYLE LLP CONCERNING THIS LETTER
AGREEMENT AND WAIVES ANY CONFLICT OF INTEREST THAT MAY ARISE OUT OF OR RELATE TO
SUCH REPRESENTATION OF YOU BY NIXON, HARGRAVE, DEVANS & DOYLE LLP.
Very truly yours,
SALANT CORPORATION
By:
Todd Kahn
Executive Vice President and
General Counsel
ACCEPTED AND AGREED TO as of _______________, 1997:
MICHAEL A. LUBIN
LUBIN, DELANO & COMPANY:
By:_________________________
Its
STATE OF ____________,
COUNTY OF
On ______________, 1997, before me personally came Michael A. Lubin to me known,
and known to me to be the individual(s) described in, and who executed the
foregoing Letter Agreement, and duly acknowledged to me that he executed the
same.
STATE OF ____________,
COUNTY OF
On ______________, 1997, before me personally came __________________ to me
known and known to me to be the _______________________ of Lubin, Delano &
Company, and who executed the foregoing Letter Agreement on behalf of Lubin,
Delano & Company, and duly acknowledged to me that he executed the same .