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EXHIBIT (10)(k)
LANDAUER, INC.
EXECUTIVE SPECIAL SEVERANCE PLAN
This document constitutes an amendment and restatement of the
Landauer, Inc. Executive Special Severance Plan (the "Plan"). Both (i) the
provisions of this amendment and restatement that are intended to cause the
Plan to comply with section 409A of the Internal Revenue Code of 1986, as
amended (the "Code"), and (ii) the second paragraph of Section 11 of the
Plan, shall be conclusively deemed to be not adverse to the interests of
any Employee and shall be effective December 31, 2009. All other
amendments included in this amendment and restatement shall be effective
120 days after Employees are notified of such amendments.
The Plan is intended to secure the continued services and ensure the
continued dedication and objectivity of the Employees (as defined in
Section 1(g)) in the event of any threat or occurrence of, or negotiation
or other action that could lead to, or create the possibility of, a Change
in Control (as defined in Section 1(d)) of the Company, by providing to
such Employees certain protections so that such Employees need not be
hindered or distracted by personal uncertainties and risks created by any
such possible Change in Control. The purpose of the Plan is to provide
benefits to a group of employees of the Company and its participating
affiliates that constitutes a "select group of management or highly
compensated employees" within the meaning of Department of Labor Regulation
Subsection 2520.104-24.
1. DEFINITIONS. As used in the Plan, the following terms shall
have the respective meanings set forth below:
(a) "Average Prior Bonus" means the bonus determined by multiplying
(A) the average of the percentages of annual base salary representing the
Employee's annual bonus for each of the three fiscal years immediately
preceding the fiscal year in which the Termination Date occurs by (B) the
Employee's highest annual base salary from the Company and its affiliated
companies in effect during the 12-month period prior to the Termination
Date.
(b) "Board" means the Board of Directors of the Company.
(c) "Cause" means:
(1) a material breach by an Employee of those duties and
responsibilities of the Employee which do not differ in any material
respect from the duties and responsibilities of the Employee during
the 90-day period immediately prior to a Change in Control (other
than as a result of incapacity due to physical or mental illness)
which is demonstrably willful and deliberate on the Employee's part,
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of the Company and which is not
remedied in a reasonable period of time after receipt of written
notice from the Company specifying such breach;
(2) the commission or conviction of a felony or any act
involving fraud, embezzlement, theft or misrepresentation; or
(3) any gross or willful misconduct of the Employee resulting
in substantial loss to the Company or substantial damage to the
Company's business or reputation.
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(d) "Change in Control" means:
(1) the acquisition by any individual, entity or group (a
"Person"), including any "person" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or
more of either (i) the then outstanding shares of common stock of the
Company (the "Outstanding Common Stock") or (ii) the combined voting
power of the then outstanding securities of the Company entitled to
vote generally in the election of directors (the "Outstanding Voting
Securities"); excluding, however, the following: (A) any acquisition
directly from the Company (excluding any acquisition resulting from
the exercise of an exercise, conversion or exchange privilege unless
the security being so exercised, converted or exchanged was acquired
directly from the Company), (B) any acquisition by the Company, (C)
any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled
by the Company, or (D) any acquisition by any corporation pursuant to
a transaction which complies with clauses (i), (ii) and (iii) of
subsection (3) of this Section 1(d); provided further, that for
purposes of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained by
the Company or any corporation controlled by the Company) shall
become the beneficial owner of 30% or more of the Outstanding Common
Stock or 30% or more of the Outstanding Voting Securities by reason
of an acquisition by the Company, and such Person shall, after such
acquisition by the Company, become the beneficial owner of any
additional shares of the Outstanding Common Stock or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at
least a majority of such Board; provided that any individual who
becomes a director of the Company subsequent to the date hereof whose
election, or nomination for election by the Company's stockholders,
was approved by the vote of at least a majority of the directors then
comprising the Incumbent Board shall be deemed a member of the
Incumbent Board; and provided further, that any individual who was
initially elected as a director of the Company as a result of an
actual or threatened solicitation by a Person other than the Board
for the purpose of opposing a solicitation by any other Person with
respect to the election or removal of directors, or any other actual
or threatened solicitation of proxies or consents by or on behalf of
any Person other than the Board shall not be deemed a member of the
Incumbent Board;
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(3) the consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially
all of the assets of the Company (a "Corporate Transaction");
excluding, however, a Corporate Transaction pursuant to which (i) all
or substantially all of the individuals or entities who are the
beneficial owners, respectively, of the Outstanding Common Stock and
the Outstanding Voting Securities immediately prior to such Corporate
Transaction will beneficially own, directly or indirectly, more than
60% of, respectively, the outstanding shares of common stock, and the
combined voting power of the outstanding securities entitled to vote
generally in the election of directors, as the case may be, of the
corporation resulting from such Corporate Transaction (including,
without limitation, a corporation which as a result of such
transaction owns the Company or all or substantially all of the
Company's assets either directly or indirectly) in substantially the
same proportions relative to each other as their ownership,
immediately prior to such Corporate Transaction, of the Outstanding
Common Stock and the Outstanding Voting Securities, as the case may
be, (ii) no Person (other than: the Company; any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company; the corporation resulting from
such Corporate Transaction; and any Person which beneficially owned,
immediately prior to such Corporate Transaction, directly or
indirectly, 30% or more of the Outstanding Common Stock or the
Outstanding Voting Securities, as the case may be) will beneficially
own, directly or indirectly, 30% or more of, respectively, the
outstanding shares of common stock of the corporation resulting from
such Corporate Transaction or the combined voting power of the
outstanding securities of such corporation entitled to vote generally
in the election of directors and (iii) individuals who were members
of the Incumbent Board will constitute at least a majority of the
members of the board of directors of the corporation resulting from
such Corporate Transaction; or
(4) the consummation of a plan of complete liquidation or
dissolution of the Company.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Company" means Landauer, Inc., a Delaware corporation.
(g) "Current Bonus" means an annual bonus for the fiscal year in
which the Change in Control occurs in an amount equal to the greater of (A)
the Employee's target annual bonus for such year and (B) the annual bonus
payable under the terms of the annual bonus plan in effect immediately
prior to the Change in Control based upon the Company's actual performance
for such fiscal year.
(h) "Employee" means any person who is employed by the Company in
an executive or officer position and who is designated by the Plan
Administrator, in his or her sole discretion, as a participant in the Plan
from time to time; PROVIDED, HOWEVER, that the Plan Administrator may not
revoke such a designation (i) without giving such person 120 days advance
notice of such revocation, (ii) when the Company is aware that a person has
taken steps reasonably calculated to effect a Change in Control, or (iii)
following a Change in Control, unless such Employee's Termination Period
has expired. The Plan Administrator, in his or her sole discretion, shall
designate each Employee as a Benefit Level I Employee, a Benefit Level II
Employee or a Benefit Level III Employee for purposes of the Plan. The
Plan Administrator may, in his or her sole discretion, change any such
designation; PROVIDED, HOWEVER, that the Plan Administrator may not change
a designation in a manner that is adverse to the interests of an Employee
(x) without giving such Employee 120 days advance notice of such change,
(y) when the Company is aware that a person has taken steps reasonably
calculated to effect a Change in Control, or (z) following a Change in
Control, unless such Employee's Termination Period has expired.
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(i) "Good Reason" means, without an Employee's express written
consent, the occurrence of any of the following events after a Change in
Control:
(i) a significant adverse change in the nature or scope of
the Employee's authority, powers, functions, duties or
responsibilities as in effect immediately prior to such Change in
Control;
(ii) a reduction by the Company in the Employee's rate of
annual base salary or bonus opportunity as in effect immediately
prior to such Change in Control or as the same may be increased from
time to time thereafter;
(iii) a change in the Employee's primary employment location to
a location that is more than 50 miles from the primary location of
the Employee's employment at the time of such Change in Control;
(iv) the failure of the Company to continue in effect any
employee benefit plan or compensation plan in which the Employee is
participating immediately prior to such Change in Control, unless the
Employee is permitted to participate in other plans providing the
Employee with substantially comparable benefits, or the taking of any
action by the Company which would adversely affect the Employee's
participation in or materially reduce the Employee's benefits under
any such plan; or
(v) the failure of the Company to obtain from any successor
or transferee of the Company an express written and unconditional
assumption of the Company's obligations under the Plan, as further
described in Section 16 of the Plan.
For purposes of the Plan, an isolated, insubstantial and inadvertent action
taken in good faith and which is remedied by the Company promptly after
receipt of written notice thereof given by the Employee shall not
constitute Good Reason.
(j) "Nonqualifying Termination" means the termination of an
Employee's employment (i) by the Company for Cause, (ii) by the Employee
for any reason other than Good Reason, (iii) as a result of the Employee's
death, (iv) by the Company due to the Employee's absence from his or her
duties with the Company on a full-time basis for at least 180 consecutive
days as a result of the Employee's incapacity due to physical or mental
illness, or (v) in connection with a sale of assets by the Company or one
of its affiliates if the Employee is offered comparable employment (as
determined by the Administrator) by the purchaser of such assets or one of
its affiliates; PROVIDED, HOWEVER, that employment shall not be deemed
comparable if such purchaser does not agree to honor the terms of the Plan
with respect to such Employee for the duration of such Employee's
Termination Period or to provide other severance benefits that, in the
aggregate, are at least as favorable as those provided under the Plan.
Notwithstanding anything contained in this Section 1(j), if an Employee
voluntarily terminates his or her employment for any reason during the
"Window Period" (hereinafter defined), such termination shall not
constitute a Nonqualifying Termination.
(k) "Separation from Service" means a "separation from service" as
defined in Treasury Regulation Section 1.409A-1(h).
(l) "Severance Period" means (i) with respect to a Benefit Level I
Employee, the period commencing on the Termination Date and ending on the
third anniversary of the Termination Date, (ii) with respect to a Benefit
Level II Employee, the period commencing on the Termination Date and ending
on the second anniversary of the Termination Date and (iii) with respect to
a Benefit Level III Employee, the period commencing on the Termination Date
and ending on the first anniversary of the Termination Date.
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(m) "Termination Date" with respect to an Employee means the date
during the Termination Period on which the Employee incurs a Separation
from Service other than by reason of a Nonqualifying Termination.
(n) "Termination Period" with respect to an Employee means the
period commencing upon a Change in Control and ending on the earlier to
occur of (i) the date which is two years following such Change in Control
and (ii) the Employee's death.
(o) "Window Period" means the 30-day period commencing one year
after the date of a Change in Control.
2. VESTING OF EQUITY AWARDS UPON A CHANGE IN CONTROL; EXERCISE
PERIOD. Immediately upon a Change in Control, all stock options and other
equity awards, if any, granted by the Company to an Employee that are not
otherwise exercisable or vested shall become exercisable, or become vested,
in full. With respect to any and all stock options granted by the Company
to an Employee, each such option shall remain exercisable following the
Employee's termination of employment until and including the earlier to
occur of (i) the date which is one year after the Employee's termination of
employment and (ii) the expiration date of the term of the option (as set
forth in the written agreement relating to such option).
3. PAYMENTS AND BENEFITS UPON SEPARATION FROM SERVICE. If during
the Termination Period an Employee incurs a Separation from Service, other
than by reason of a Nonqualifying Termination, and the Employee (or the
Employee's executor or other legal representative in the case of the
Employee's death or disability following such termination) executes a
general release and noncompetition, nonsolicitation, intellectual property
and confidentiality agreement in a form reasonably acceptable to the
Company in its sole discretion (the "Release and Noncompetition
Agreement"), within 60 days following the Termination Date and has not
revoked the Release and Noncompetition Agreement, the Company shall provide
to the Employee, as compensation for services rendered to the Company, and
in consideration of the general release and the covenants set forth in the
Release and Noncompetition Agreement, the benefits described in paragraphs
(a), (b) and (c) of this Section 3. In addition, if the employment of an
Employee shall terminate for any reason, then the Employee shall be
entitled to the following without regard to whether a Release and
Noncompetition Agreement is executed: (i) a cash amount (subject to any
applicable payroll or other taxes required to be withheld pursuant to
Section 6) equal to the sum of the Employee's full annual base salary from
the Company and its affiliated companies through the Termination Date, and
any accrued vacation pay, in each case to the extent not theretofore paid,
and (ii) the benefits provided under the terms of any employee benefit plan
in which the Employee participates including, without limitation, the
Company's Supplemental Key Executive Retirement Plan or the Company's
Non-Qualified Excess Plan.
(a) The Company shall pay to the Employee (or the Employee's
beneficiary or estate, as the case may be) a lump sum cash amount (subject
to any applicable payroll or other taxes required to be withheld pursuant
to Section 6) equal to the sum of (1) and (2) below:
(1) notwithstanding anything to the contrary contained in the
Company's annual bonus plan in effect at the time of the Employee's
Separation from Service, either (A) the Current Bonus if such
Separation from Service occurs in the same fiscal year of the Company
as the fiscal year in which the Change in Control occurs, or (B) the
Average Prior Bonus if such Separation from Service occurs in a
fiscal year of the Company that is subsequent to the fiscal year in
which the Change in Control occurs, in either case multiplied by a
fraction, the numerator of which is the number of days in the fiscal
year in which the Employee's Separation from Service occurs through
the Termination Date and the denominator of which is 365 or 366, as
applicable; plus
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(2)
(i) with respect to a Benefit Level I Employee, the sum of
(A) three times the Employee's highest annual base salary from the
Company and its affiliated companies in effect during the 12-month
period prior to the Termination Date and (B) three times the greater
of (1) the Employee's target annual bonus in effect immediately prior
to the Change in Control or immediately prior to the Termination
Date, whichever is higher, and (2) an annual bonus equal to the
Average Prior Bonus;
(ii) with respect to a Benefit Level II Employee, the sum of
(A) two times the Employee's highest annual base salary from the
Company and its affiliated companies in effect during the 12-month
period prior to the Termination Date and (B) two times the greater of
(1) the Employee's target annual bonus in effect immediately prior to
the Change in Control or immediately prior to the Termination Date,
whichever is higher, and (2) an annual bonus equal to the Average
Prior Bonus; and
(iii) with respect to a Benefit level III Employee, the sum of
(A) one times the Employee's highest annual base salary from the
Company and its affiliated companies in effect during the 12-month
period prior to the Termination Date and (B) one times the greater of
(1) the Employee's target annual bonus in effect immediately prior to
the Change in Control or immediately prior to the Termination Date,
whichever is higher and (2) an annual bonus equal to the Average
Prior Bonus.
Subject to the following sentence, the amount described above shall be paid
within 30 days following the date of execution of the Release and
Noncompetition Agreement, except with respect to any payment of the Current
Bonus, which shall be paid to the Employee at such time as annual bonuses
are paid to other employees of the Company who are eligible to receive an
annual bonus. Notwithstanding the foregoing, if an Employee is a
"specified employee" (as that term is used in Section 409A of the Code and
regulations and other guidance issued thereunder), on his or her
Termination Date, then (A) no such payment shall be made before the
six-month anniversary of such Termination Date, and (B) all such payments
shall be paid within 30 days after such six-month anniversary; PROVIDED,
HOWEVER, that if such Participant dies or becomes "disabled" (within the
meaning of Section 409A(a)(2)(C)(i) of the Code) prior to such six-month
anniversary, then such payments shall be made within ninety (90) days
following the date on which he or she dies or becomes disabled, as
applicable.
(b) For the period commencing on the Termination Date and ending on
the earlier of (i) the expiration of the Employee's Severance Period and
(ii) the date on which the Employee becomes eligible to participate in and
receive medical, dental and life insurance benefits under a plan or
arrangement sponsored by another employer having benefits substantially
equivalent to the benefits provided pursuant to this Section 3(b), the
Company shall continue the Employee's medical, dental and life insurance
coverage upon the same terms and otherwise to the same extent as such
coverage shall have been in effect immediately prior to the Change in
Control or, if more favorable to the Employee, to the same extent as such
coverage shall have been in effect immediately prior to the Employee's
Termination Date, and the Company and the Employee shall share the costs of
the continuation of such medical, dental and life insurance coverage in the
same proportion as such costs were shared immediately prior to the Change
in Control or, if more favorable to the Employee, immediately prior to the
Employee's Termination Date.
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(c) During the Employee's Severance Period, the Employee shall be
entitled to outplacement services to be provided by a firm selected by the
Company. The maximum payments to be made by the Company during the
Severance Period for outplacement services with respect to a Benefit Level
I Employee shall be $30,000, with respect to a Benefit Level II Employee
shall be $25,000 and with respect to a Benefit Level III Employee shall be
$15,000. Payments shall be made directly to the outplacement firm upon
submission of proper documentation to the Company. If an Employee elects
not to use such outplacement services, the Employee will not be entitled to
any cash payment in lieu thereof.
4. CERTAIN ADDITIONAL PAYMENTS; REDUCTION OF PAYMENTS.
(a) Anything in the Plan to the contrary notwithstanding, in the
event it shall be determined that any payment or distribution by the
Company or its affiliated companies to or for the benefit of the Employee
(whether paid or payable or distributed or distributable pursuant to the
terms of the Plan or otherwise, but determined without regard to any
additional payments required under this Section 4) (a "Payment") would be
subject to the excise tax imposed by Section 4999 of the Code or any
interest or penalties are incurred by the Employee with respect to such
excise tax (such excise tax, together with any such interest and penalties,
are hereinafter collectively referred to as the "Excise Tax"), then the
Employee shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Employee of all taxes
(including any interest and penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and
penalties imposed with respect thereto) and the Excise Tax imposed upon the
Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the
foregoing provisions of this Section 4(a), if it shall be determined that
the Employee is entitled to a Gross-Up Payment, but that the Employee,
after taking into account the Payments and the Gross-Up Payment, would not
receive a net after-tax benefit (taking into account both income taxes and
any Excise Tax) which is at least ten percent (10%) greater than the net
after-tax proceeds to the Employee resulting from an elimination of the
Gross-Up Payment and a reduction of the Payments, in the aggregate, to an
amount (the "Reduced Amount") that is one dollar less than the smallest
amount that would give rise to any Excise Tax, then no Gross-Up Payment
shall be made to the Employee and the Payments, in the aggregate, shall be
reduced to the Reduced Amount.
(b) Subject to the provisions of Section 4(c), all determinations
required to be made under this Section 4, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be
made by the Company's public accounting firm (the "Accounting Firm") which
shall provide detailed supporting calculations both to the Company and the
Employee within fifteen (15) business days of the receipt of notice from
the Employee that there has been a Payment, or such earlier time as is
requested by the Company. In the event that the Accounting Firm is serving
as accountant or auditor for the individual, entity or group effecting the
Change in Control, the Employee shall appoint another nationally recognized
public accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm
hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to
this Section 4, shall be paid by the Company to the Employee within five
(5) days of the receipt of the Accounting Firm's determination. If the
Accounting Firm determines that no Excise Tax is payable by the Employee,
it shall furnish the Employee with a written opinion that failure to report
the Excise Tax on the Employee's applicable federal income tax return would
not result in the imposition of a negligence or similar penalty. Any
determination by the Accounting Firm shall be binding upon the Company and
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the Employee. As a result of the uncertainty in the application of Section
4999 of the Code at the time of the initial determination by the Accounting
Firm hereunder, it is possible that Gross-Up Payments which will not have
been made by the Company should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event that the
Company exhausts its remedies pursuant to Section 4(c) and the Employee
thereafter is required to make a payment of any Excise Tax, the Accounting
Firm shall determine the amount of the Underpayment that has occurred and
any such Underpayment shall be promptly paid by the Company to or for the
benefit of the Employee.
(c) The Employee shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than ten (10) business days after
the Employee is informed in writing of such claim and shall apprise the
Company of the nature of such claim and the date on which such claim is
requested to be paid. The Employee shall not pay such claim prior to the
expiration of the 30-day period following the date on which the Employee
gives such notice to the Company (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If the
Company notifies the Employee in writing prior to the expiration of such
period that it desires to contest such claim, the Employee shall:
(i) give the Company any information reasonably requested by
the Company relating to such claim,
(ii) take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any proceedings
relating to such claim;
PROVIDED, HOWEVER, that the Company shall bear and pay directly all costs
and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Employee
harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result
of such representation and payment of costs and expenses. Without
limitation on the foregoing provisions of this Section 4(c), the Company
shall control all proceedings taken in connection with such contest and, at
its sole option, may pursue or forgo any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in respect
of such claim and may, at its sole option, either direct the Employee to
pay the tax claimed and sue for a refund or contest the claim in any
permissible manner, and the Employee agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; PROVIDED FURTHER, that if the Company directs the Employee to
pay such claim and sue for a refund, the Company shall advance the amount
of such payment to the Employee on an interest-free basis and shall
indemnify and hold the Employee harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect
thereto) imposed with respect to such advance or with respect to any
imputed income with respect to such advance; and PROVIDED FURTHER, that any
extension of the statute of limitations relating to payment of taxes for
the taxable year of the Employee with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder
and the Employee shall be entitled to settle or contest, as the case may
be, any other issue raised by the Internal Revenue Service or any other
taxing authority.
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(d) If, after the receipt by the Employee of an amount advanced by
the Company pursuant to Section 4(c), the Employee becomes entitled to
receive, and receives, any refund with respect to such claim, the Employee
shall (subject to the Company's complying with the requirements of Section
4(c) promptly pay to the Company the amount of such refund (together with
any interest paid or credited thereon after taxes applicable thereto). If,
after the receipt by the Employee of an amount advanced by the Company
pursuant to Section 4(c), a determination is made that the Employee shall
not be entitled to any refund with respect to such claim and the Company
does not notify the Employee in writing of its intent to contest such
denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.
5. PLAN ADMINISTRATION; CLAIMS PROCEDURE.
(a) The Plan shall be interpreted and administered by the person or
persons appointed by the Board from time to time to administer the Plan
(the "Plan Administrator"), who shall have complete authority, in his or
her sole discretion subject to the express provisions of the Plan, to make
all determinations necessary or advisable for the administration of the
Plan. All questions arising in connection with the interpretation of the
Plan or its administration shall be submitted to and determined by the Plan
Administrator in a fair and equitable manner.
(b) The Plan Administrator may from time to time delegate any of
his or her duties hereunder to such person or persons as the Plan
Administrator may designate. The Plan Administrator is empowered, on
behalf of the Plan, to engage accountants, legal counsel and such other
persons as the Plan Administrator deems necessary or advisable for the
performance of his or her duties under the Plan. The functions of any such
persons engaged by the Plan Administrator shall be limited to the specified
services and duties for which they are engaged, and such persons shall have
no other duties, obligations or responsibilities under the Plan. Such
persons shall exercise no discretionary authority or discretionary control
respecting the administration of the Plan. All reasonable fees and
expenses of such persons shall be borne by the Company.
(c) If any Employee or other person believes he is entitled to
benefits in an amount greater than those, which he is receiving or has
received, he may file a written claim with the Secretary of the Company.
Such claim shall state the nature of the claim, the facts supporting the
claim, the amount claimed, and the address of the claimant. The secretary
of the Company shall review the claim and shall, within 90 days after
receipt of the claim, give written notice by registered or certified mail
to the claimant of the Secretary's decision with respect to the claim. If
special circumstances require an extension of time, the claimant shall be
so advised in writing within the initial 90-day period and in no event
shall such an extension exceed 90 days. The notice of the Company's
decision with respect to the claim shall be written in a manner designed to
be understood by the claimant and, if the claim is wholly or partially
denied, set forth the specific reasons for the denial, specific references
to the pertinent Plan provisions on which the denial is based, a
description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary, and an explanation of the claim review procedure
under the Plan. The Company shall also advise the claimant that he or his
duly authorized representative may request a review of the denial by the
President of the Company by filing with the Company within 60 days after
notice of the denial has been received by the claimant, a written request
for such review. The claimant shall be informed that he may have
reasonable access to pertinent documents and submit comments in writing to
the President within the same 60-day period. If a request is so filed,
review of the denial shall be made by the President within 60 days after
receipt of such request unless special circumstances require an extension,
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and the claimant shall be given written notice of the President's final
decision. If special circumstances require an extension of time, the
claimant shall be so advised in writing within the initial 60-day period
and in no event shall such an extension exceed 60 days. The notice of the
President's final decision shall include specific reasons for the decision
and specific references to the pertinent Plan provisions on which the
decision is based and shall be written in a manner designed to be
understood by the claimant.
6. WITHHOLDING TAXES. The Company may withhold from all payments
due under the Plan to each Employee (or his or her beneficiary or estate)
all taxes which, by applicable federal, state, local or other law, the
Company is required to withhold therefrom.
7. AMENDMENT AND TERMINATION. The Company shall have the right,
in its sole discretion, pursuant to action by the Board, to approve the
amendment or termination of the Plan, which amendment or termination shall
not become effective until the date fixed by the Board for such amendment
or termination, which date, in the case of an amendment which would be
adverse to the interests of any Employee or in the case of termination,
shall be at least 120 days after notice thereof is given by the Company to
the Employees in accordance with Section 18 hereof; PROVIDED, HOWEVER, that
no such action shall be taken by the Board during any period when the Board
has knowledge that any person has taken steps reasonably calculated to
effect a Change in Control until, in the opinion of the Board, such person
has abandoned or terminated its efforts to effect a Change in Control; and
PROVIDED FURTHER, that with respect to an Employee, on and after a Change
in Control, in no event shall the Plan be amended in a manner adverse to
the interests of such Employee or terminated prior to the end of such
Employee's Termination Period.
8. REIMBURSEMENT OF EXPENSES; INTEREST ON LATE PAYMENTS.
(a) If any contest or dispute shall arise under the Plan involving
termination of the Employee's employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance with the
terms hereof, the Company shall reimburse the Employee, on a current basis,
for all legal fees and expenses, if any, incurred by the Employee in
connection with such contest or dispute, together with interest thereon at
a rate equal to the prime rate, as published under "Money Rates" in THE
WALL STREET JOURNAL from time to time, plus 300 basis points, but in no
event higher than the maximum legal rate permissible under applicable law
(the "Interest Rate"), such interest to accrue from the date the Company
receives the Employee's written statement for such fees and expenses
through the date of payment thereof; PROVIDED, HOWEVER, that in the event
the resolution of any such contest or dispute includes a finding denying,
in total, the Employee's claims in such contest or dispute, the Employee
shall be required to reimburse the Company, over a period of 12 months from
the date of such resolution, for all sums advanced to the Employee pursuant
to this Section 8(a).
(b) With respect to any and all payments that are required to be
made by the Company to an Employee pursuant to the Plan and that are not
made within the time period specified herein, the Company shall pay to the
Employee interest on such payments at the Interest Rate. Such interest
shall accrue from the due date of the required payment through the date on
which such payment is made to the Employee.
(c) For the avoidance of doubt and to ensure compliance with
Section 409A of the Code, (i) reimbursements under this Section 8 shall be
made promptly, but in any event on or before the last day of the taxable
year following the taxable year in which the relevant expense is incurred,
(ii) the amount of expenses eligible for reimbursement during a taxable
year may not affect the expenses eligible for reimbursement in any other
taxable year, and (iii) this Section 8 shall only be applicable to expenses
incurred during the lifetime of the Employee or within 10 years thereafter.
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9. ENTIRE AGREEMENT. Subject to Section 10(a) hereof, any amount
paid pursuant to the Plan shall be paid in lieu of any other amount of
severance relating to salary or bonus continuation, any other continuation
of medical, dental or life insurance coverage (other than coverage required
by the Consolidated Omnibus Budget Reconciliation Act of 1985) or any other
outplacement services to be received by the Employee upon termination of
employment of the Employee under any severance plan, policy or arrangement
of the Company. Subject to the foregoing, the rights of, and benefits
payable to, an Employee pursuant to the Plan are in addition to any rights
of, or benefits payable to, an Employee under any other employee benefit
plan or compensation program of the Company. All rights of an Employee
under any such plan or program shall be determined in accordance with the
provisions of such plan or program.
10. OFFSET; MITIGATION.
(a) If the Company is obligated by law or contract to pay severance
pay, notice pay or other similar benefits, or if the Company is obligated
by law or by contract to provide advance notice of separation ("Notice
Period"), then any payments hereunder shall be reduced by the amount of any
such severance pay, notice pay or other similar benefits, as applicable,
and by the amount of any severance pay, notice pay or other similar
benefits received during any Notice Period.
(b) In no event shall an Employee be obligated to seek other
employment or to take other action by way of mitigation of the amounts
payable and the benefits provided to such Employee under any of the
provisions of the Plan, and such amounts and benefits shall not be reduced
whether or not such Employee obtains other employment, except as otherwise
provided in Section 3(c) hereof.
11. UNFUNDED PLAN. The Plan shall not be funded. No Employee
entitled to benefits hereunder shall have any right to, or interest in, any
specific assets of the Company, but an Employee shall have only the rights
of a general creditor of the Company to receive benefits on the terms and
subject to the conditions provided in the Plan.
Upon a Change in Control, the Company shall establish a trust for the
purpose of providing the benefits under the Plan. Any such trust shall be
established in such manner so as to be a "grantor trust" of which the
Company is the grantor, within the meaning of section 671 et. seq. of the
Code. The Company shall deposit in such trust assets sufficient to satisfy
the Company's obligations under the Plan, assuming, for these purposes,
that each Employee will be entitled to benefits hereunder. Such trust
shall not permit a reversion of any assets to the Company; PROVIDED,
HOWEVER, that if an Employee's Termination Period expires and such
Employee's employment has not been terminated, then an amount equal to the
amount that would have been necessary to satisfy any obligations to such
Employee may revert to the Company. The existence of any such trust shall
not relieve the Company of its liabilities under the Plan, but the
obligations of the Company under the Plan shall be deemed satisfied to the
extent paid from the trust.
12. PAYMENTS TO MINORS, INCOMPETENTS AND BENEFICIARIES. Any
benefit payable to or for the benefit of a minor, an incompetent person or
other person incapable of giving a receipt therefor shall be deemed paid
when paid to such person's guardian or to the party providing or reasonably
appearing to provide for the care of such person, and such payment shall
fully discharge the Company, the Plan Administrator and all other parties
with respect thereto. If an Employee shall die while any amounts would be
payable to the Employee under the Plan had the Employee continued to live,
all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of the Plan to such person or persons appointed
in writing by the Employee to receive such amounts or, if no person is so
appointed, to the estate of the Employee.
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13. NON-ASSIGNABILITY. None of the payments, benefits or rights of
any Employee shall be subject to any claim of any creditor, and, in
particular, to the fullest extent permitted by law, all such payments,
benefits and rights shall be free from attachment, garnishment, trustee's
process or any other legal or equitable process available to any creditor
of such Employee. Except as otherwise provided herein or by law, no right
or interest of any Employee under the Plan shall be assignable or
transferable, in whole or in part, either directly or by operation of law
or otherwise, including without limitation by execution, levy, garnishment,
attachment or pledge; no attempted assignment or transfer thereof shall be
effective; and no right or interest of any Employee under the Plan shall be
subject to any obligation or liability of such Employee.
14. NO RIGHTS TO CONTINUED EMPLOYMENT. Neither the adoption of the
Plan, nor any amendment hereof, nor the creation of any fund, trust or
account, nor the payment of any benefits, shall be construed as giving any
Employee the right to be retained in the service of the Company, and all
Employees shall remain subject to discharge to the same extent as if the
Plan had not been adopted.
15. ARBITRATION. Except as otherwise provided in Section 6 of the
Release and Noncompetition Agreement, any dispute or controversy between
the Company and the Employee, whether arising out of or relating to the
Plan, the breach of the provisions of the Plan, or otherwise, shall be
settled by arbitration in Chicago, Illinois administered by the American
Arbitration Association, with any such dispute or controversy arising under
the Plan being so administered in accordance with its Commercial Rules then
in effect, and judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. The arbitrator shall
have the authority to award any remedy or relief that a court of competent
jurisdiction could order or grant, including, without limitation, the
issuance of an injunction. However, either party may, without
inconsistency with this arbitration provision, apply to any court having
jurisdiction over such dispute or controversy and seek interim provisional,
injunctive or other equitable relief until the arbitration award is
rendered or the controversy is otherwise resolved. Except as necessary in
court proceedings to enforce this arbitration provision or an award
rendered hereunder, or to obtain interim relief, neither a party nor an
arbitrator may disclose the existence, content or results of any
arbitration hereunder without the prior written consent of the Company and
the Employee. The Company and the Employee acknowledge that the Plan
evidences a transaction involving interstate commerce. Notwithstanding any
choice of law provision included in the Plan, the United States Federal
Arbitration Act shall govern the interpretation and enforcement of this
arbitration provision.
16. SUCCESSORS; BINDING AGREEMENT. The Plan shall inure to the
benefit of and be binding upon the beneficiaries, heirs, executors,
administrators, successors and assigns of the parties, including each
Employee, present and future, and any successor to the Company or one of
its subsidiaries. The Plan shall not be terminated by any merger or
consolidation of the Company whereby the Company is or is not the surviving
or resulting corporation or as a result of any transfer of all or
substantially all of the assets of the Company. In the event of any such
merger, consolidation or transfer of assets, the provisions of the Plan
shall be binding upon the surviving or resulting corporation or the person
or entity to which such assets are transferred. The Company agrees that
concurrently with any merger, consolidation or transfer of assets referred
to in this Section 16, it will cause any surviving or resulting corporation
or transferee unconditionally to assume all of the obligations of the
Company hereunder.
17. HEADINGS. The headings and captions herein are provided for
reference and convenience only, shall not be considered part of the Plan
and shall not be employed in the construction of the Plan.
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18. NOTICES. Any notice or other communication required or
permitted pursuant to the terms hereof shall have been duly given when
delivered or mailed by United States mail, first class, postage prepaid,
addressed to the intended recipient at his, her or its last known address.
19. EFFECTIVE DATE. The Plan shall be effective as of the date
hereof and shall remain in effect unless and until terminated by the Board
pursuant to Section 7 hereof.
20. EMPLOYMENT WITH SUBSIDIARIES. For purposes of the Plan,
employment with the Company shall include employment with any corporation
or other entity in which the Company has a direct or indirect ownership
interest of 50% or more of the total combined voting power of the then
outstanding securities of such corporation or other entity entitled to vote
generally in the election of directors.
21. GOVERNING LAW; VALIDITY. The Plan shall be governed by, and
construed and enforced in accordance with, the internal laws of the State
of Illinois (without regard to principles of conflicts of laws) to the
extent not preempted by Federal law, which shall otherwise control. If any
provision of the Plan shall be held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provision hereof,
and the Plan shall be construed and enforced as if such provision had not
been included.
22. COMPLIANCE WITH SECTION 409A OF CODE. The Plan is intended to
comply with the provisions of section 409A of the Code, and shall be
interpreted and construed accordingly. The Company shall have the
discretion and authority to amend the Plan at any time to satisfy any
requirements of section 409A of the Code or guidance provided by the U.S.
Treasury Department to the extent applicable to the Plan. Notwithstanding
the foregoing, in no event shall the Company, any of its employees, or any
member of the Board have any liability for any taxes imposed in connection
with a failure of the Plan to comply with Section 409A of the Code.
IN WITNESS WHEREOF, the Company has caused the Plan to be adopted as
of the 12th of November, 2009.
LANDAUER, INC.
By: /s/ Katherine E. Bober
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