HALYARD HEALTH, INC.
SEVERANCE PAY PLAN

Effective November 1, 2014

Amended and Restated October 25, 2017

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TABLE OF CONTENTS

ARTICLE    TITLE

I    NAME, PURPOSE AND EFFECTIVE DATE OF PLAN

II    DEFINITIONS

III    ELIGIBILITY AND PARTICIPATION

IV    SEVERANCE BENEFITS

V    PLAN ADMINISTRATION

VI    LIMITATIONS AND LIABILITIES

APPENDIX A - COVERED EMPLOYERS

        

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ARTICLE I

NAME, PURPOSE AND EFFECTIVE DATE OF PLAN

1.1
Name of the Plan. Halyard Health, Inc. (the “Corporation”) hereby establishes a
severance pay plan for its Employees, to be known as the Halyard Health, Inc.
Severance Pay Plan (the “Plan”) as set forth in this document. The Plan is
intended to qualify as an employee welfare benefit plan within the meaning of
Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”).

1.2
Purpose of the Plan. The purpose of the Plan is to provide Eligible Employees a
severance benefit in the event of involuntary termination of employment in
certain circumstances. The Plan is not intended as a replacement or substitution
for any agreement between a Participant and his or her Employer executed prior
or subsequent to the effective date of the Plan.

1.3
Effective Date. The Plan was effective as of November 1, 2014, and was amended
and restated as of October 25, 2017.

ARTICLE II

DEFINITIONS AND CONSTRUCTION

2.1
Definitions. When the following words and phrases appear in this Plan, they
shall have the respective meanings set forth below unless the context clearly
indicates otherwise.

(a)
Average Bonus Amount: The average of the annual cash incentive awards paid to
the Participant under MAAP, EOAAP, or other annual cash incentive plan
maintained by the Corporation or the Participant’s Employer, for the three years
prior to the year in which the Separation from Service occurs. If a Participant
received a prorated cash incentive award during any of the prior three years,
then for purposes of determining the Annual Bonus Amount the award for such year
will be deemed to be equal to the award the Participant would have received if
the award had not been prorated for that year. If a Participant did not
participate in the Bonus Program in each of the prior three years, then for
purposes of determining the Annual Bonus Amount, the Participant will be
presumed to have received an annual incentive award for each year in which he or
she did not participate in the Bonus Plan equal to the Participant’s target
award for the year in which the Separation of Service occurs.

(b)
Base Pay: A Participant’s base pay on his or her Termination Date, calculated
based upon the Participant’s then-current base salary or stated pay rate. If a
Participant is a full-time Employee, Base Pay will be calculated assuming a
40-hour work week. If a Participant is an Employee who works less than 40 hours
per week, Base Pay will be calculated assuming the Participant works his or her
regularly scheduled hours per week. Base Pay does not include overtime pay,

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disability pay, nonrecurring payments (such as reimbursements or relocation
expenses), annual incentive awards under the EOAAP, MAAP or other programs,
sales incentive awards, long-term incentive awards, or other remuneration. The
calculation of Base Pay shall be subject to any applicable Committee rule.

(c)
Board: The Board of Directors of the Corporation.

(d)
Cause: Any termination of employment which is classified by the Employer as
being for “cause,” including but not limited to a termination due to any of the
following: (i) Participant’s unsatisfactory performance of duties or inability
to meet the requirements of the position, unless classified by the Employer as a
Performance Termination; (ii) any habitual neglect of duty or misconduct of the
Participant in discharging any of his or her duties and responsibilities; (iii)
excessive unexcused, or statutorily unprotected absenteeism or inattention to
duties; (iv) failure or refusal to comply with the provisions of the Employer’s
personnel manual or any other rule or policy of the Employer; (v) misconduct,
including but not limited to, engaging in conduct which the Committee reasonably
determines to be detrimental to the Employer; (vi) disloyal, dishonest or
illegal conduct by the Participant; (vii) theft, fraud, embezzlement or other
criminal activity involving the Participant’s relationship with the Employer;
(viii) the Participant’s violation of any applicable statute, regulation, or
rule, or provision of any applicable code of professional ethics; (ix)
suspension, revocation, or other restriction of the Participant’s professional
license, if applicable; or (x) the Employer’s inability to confirm, to its sole
satisfaction, the references and/or credentials which the Participant provided
with respect to any professional license, educational background and employment
history.

(e)
COBRA: Medical continuation coverage elected under the provisions of the
Consolidated Omnibus Budget Reconciliation Act of 1985.

(f)
Code: The Internal Revenue Code of 1986, as amended from time to time, and as
construed and interpreted by valid regulations or rulings issued thereunder.

(g)
Committee: The Benefits Administration Committee is appointed to administer and
regulate the Plan as provided in Article V.

(h)
Comparable Position: Any position of employment offered to a Participant will be
considered a Comparable Position under this Plan unless, as determined by the
Committee in its sole discretion, such position would result in any of the
following changes for the Participant:

(i) With respect to all Participants, a change, by more than 50 miles, in the
geographic location at which the Participant must perform the services.
(ii) In addition, with respect to Tier I and Tier II Participants only, a
material diminution in the Participant’s Base Pay on the date of such offer, or
a material diminution of the Participant’s authority, duties or
responsibilities, including but not limited to situations where an Employee in
either a Tier I or Tier II position ceases to be in either a Tier I or Tier II
position.

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The Participant must provide notice to the Corporation of the existence of any
of the above conditions within a period not to exceed 90 days of the initial
offer of the non-Comparable Position to the Participant, and the Corporation
must be provided a period of at least 30 days following receipt of the notice
during which it may remedy the offer so that it constitutes a Comparable
Position. Any determination by the Committee as to whether a Participant has
been offered a Comparable Position shall be final and conclusive as to all
parties.
(i)
Corporation: Halyard Health, Inc.

        
(j)
Effective Date: November 1, 2014, or with respect to a particular company that
became a Subsidiary after that date, such later date on which such company
became a Subsidiary.

(k)
Eligible Employee: An hourly Employee not covered by a collective bargaining
unit, or salaried Employee, on the regular payroll of an Employer. For purposes
of this subsection, “on the regular payroll of an Employer” shall mean paid
through the payroll department of such Employer, and shall exclude (A) employees
classified by an Employer as intermittent or temporary, and (B) persons
classified by an Employer as independent contractors, regardless of how such
persons may be classified by any federal, state, or local, domestic or foreign,
governmental agency or instrumentality thereof, or court.

(l)
Employee: A person classified as a common law employee by an Employer.

(m)
Employer: The Corporation and each Subsidiary, other than any Subsidiary which
the Committee shall from time to time designate as a non-participating
Subsidiary for purposes of the Plan. A list of Subsidiaries excluded from the
definition of Employers is set forth in Appendix A.

(n)
EOAAP: The Corporation’s Executive Officer Achievement Award Program or any
successor plan.

(o)
MAAP: The Corporation’s Management Achievement Award Program or any successor
plan.

(p)
MAAP Eligible: Participants who as of their date of Separation from Service meet
the eligibility requirements to participate under MAAP.

(q)
Participant: An Eligible Employee who has met the eligibility requirements to
participate in the Plan pursuant to Article III.

(r)
Performance Termination: Any termination of employment with the Employer which
is classified by the Employer as for a Participant’s unsatisfactory performance
of duties, or inability to meet the requirements of the Participant’s position.
The termination of employment will be classified as a Performance Termination if
it is approved by the Participant’s team leader, the supervisor of the team
leader for the Participant and the applicable Human Resources Leadership Team
member, and also meets one of the following criteria:

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(i)
the Employee experiences an involuntary Separation from Service on the release
date determined by the Employer after the Employee’s team leader has offered the
Employee a choice of either entering into a Performance Improvement Plan or a
Performance Termination, and the Employee has elected a Performance Termination
rather than entering into a Performance Improvement Plan; or

(ii)
the Employee experiences an involuntary Separation from Service after the
Employee’s team leader had offered the Employee a choice of either entering into
a Performance Improvement Plan or a Performance Termination, the Employee
elected to enter into a Performance Improvement Plan, and had in the judgment of
the Employee’s team leader, subsequently failed to successfully improve his or
her performance to an acceptable level following completion of the Performance
Improvement Plan.

(s)
Plan: The Halyard Health, Inc. Severance Pay Plan.

(t)
Plan Year: A calendar year period beginning January 1 and ending December 31.

(u)
Prorated Final Year Bonus: Payment made to a Participant pursuant to Article IV
hereof equal to (i) the annual cash incentive award that would have been payable
to the Participant, for the year in which the Termination Date occurs, under the
EOAAP, MAAP or other annual cash incentive plan maintained by the Corporation or
the Participant’s Employer and in which the Participant was a participant on the
Termination Date, if the Participant had remained employed for the entire
calendar year, and assuming that performance was achieved at either (A) the
target level of performance or (B) the actual level of performance achieved by
the Corporation (or the Employer, any business unit, and/or the Participant, as
applicable) for such year, as provided for the Participant in Section 4.1(a),
multiplied by (ii) a fraction, the numerator of which is the number of days
worked by the Participant during such final year and the denominator of which is
365.

(v)
Qualifying Termination: A Participant’s Separation from Service under the
conditions described in Section 3.2.

(w)
Separation from Service: Termination of employment with the Employer within the
meaning of Code Section 409A. A Separation from Service will be deemed to have
occurred if the Employee’s services are reduced to an annual rate that is 20
percent or less of the services rendered, on average, during the immediately
preceding three years of employment (or if employed less than three years, such
lesser period). The Committee shall have the power to promulgate Committee Rules
and other guidelines in connection with the determination of a Separation from
Service, and any such determination by the Committee shall be final and
conclusive as to all parties.

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(x)
Severance Pay: Cash severance payment made to a Participant pursuant to Article
IV hereof and based on a Participant’s Base Pay.

(y)
Subsidiary: Any corporation, 50% or more of the voting shares of which are owned
directly or indirectly by the Corporation, which is incorporated under the laws
of one of the States of the United States.

(z)
Termination Date: The date of an Employee’s Separation from Service.

(aa)
Years of Service: A Participant shall be credited with a Year of Service for
each year commencing with the Participant’s amended service date, as maintained
by the Corporation’s Human Resources Information System, and ending on the
Employee’s Termination Date, rounded up to the nearest whole year for a partial
year of service in excess of six months, and rounded down to the nearest whole
year for a partial year less than or equal to six months (including, for
avoidance of doubt, service with Kimberly-Clark Corporation prior to the
spin-off of the Corporation from Kimberly-Clark Corporation). Years of Service
will not be credited in fractional amounts. Notwithstanding any provision in the
Plan to the contrary, an Employee’s credited Years of Service shall be reduced
to the extent such Years of Service have previously been used to calculate a
prior severance payment to the Participant.

2.2
Construction: Where appearing in the Plan the masculine shall include the
feminine and the plural shall include the singular, unless the context clearly
indicates otherwise. The words “hereof,” “herein,” “hereunder” and other similar
compounds of the word “here” shall mean and refer to the entire Plan and not to
any particular section or subsection.

ARTICLE III

ELIGIBILITY AND PARTICIPATION

3.1
Participation. An Eligible Employee shall become a Participant on the later of
the Effective Date or the first day actively employed by an Employer.

3.2
Eligibility. Each Participant who experiences an involuntary Separation from
Service for a reason (i) other than Cause; or (ii) after receiving an offer of a
Comparable Position pursuant to Section 3.3 (each, a “Qualifying Termination”),
shall be eligible to receive Severance Benefits. For the avoidance of doubt, a
Qualifying Termination shall not include, and Severance Benefits shall not be
paid to any Participant who:

(a)
does not experience a Separation from Service because the Employee accepts
another position (either a Comparable Position or any other position);

(b)
is terminated during a period in which such Participant is not actively at work
(i.e. has been on leave) for more than 25 weeks, except to the extent otherwise
required by law;

(c)
is terminated for Cause;

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(d)
voluntarily resigns or retires; or

(e)
dies or becomes subject to a disability.

3.3
Comparable Position. A Qualifying Termination shall not include, and Severance
Benefits shall not be paid to any Participant whose employment is involuntarily
terminated related to:

(a)
any separation or reorganization of the Corporation including, but not limited
to, a sale, spin-off or shutdown of a portion of the Corporation, including but
not limited to a portion of a plant or other location, if such Participant is
offered a Comparable Position with the successor entity,

(b)
the outsourcing of a Participant to a company other than an Employer, in which
such Participant is offered or continues in a Comparable Position,

(c)
any elimination of a job function, or transfer of a Participant’s position to
another location, in which such Participant is offered a Comparable Position
with the Corporation, or

(d)
any other circumstances involving an offer of a Comparable Position.

3.4    Duration. A Participant remains a Participant under the Plan until the
earliest of:

(a)
the date the Participant is no longer an Eligible Employee;

(b)
the Participant’s Termination Date;

(c)
the date the Subsidiary employing the Participant ceases to be an Employer; or

(d)
the date the Plan terminates.

3.5
Separation Agreement and Release. No Participant shall be entitled to receive
Severance Benefits hereunder unless such Participant executes a Separation
Agreement and Full and Final Release of Claims (the “Separation Agreement”), in
the form required by the Corporation, within the period specified for such
individual therein and such Participant does not revoke such Separation
Agreement in writing within the 7-day period following the date on which it is
executed. The Employer shall provide the Separation Agreement to the Participant
promptly following the Termination Date.

3.6
Continuing Obligations. A Participant shall retain in confidence any
confidential information known to the Participant concerning the Corporation and
its business so long as such information is not publicly disclosed by a
non-related party.

ARTICLE IV

SEVERANCE BENEFITS

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4.1
Severance Benefits. The decision to pay any Severance Benefits under this Plan,
or to increase or decrease the amount of Severance Benefits set forth below,
shall be in the sole discretion of the Committee and other authorized
individuals as authorized pursuant to Section 5.7 below. Any such increase or
decrease in the amount of Severance Benefits shall be final and conclusive as to
all parties. Subject to the exercise of such discretion, a Participant’s
Severance Benefits shall be determined as follows:

(a)
Each Participant who is eligible to receive Severance Benefits due to a
Qualifying Termination as provided in Article III above, but whose termination
of employment is not classified by the Employer as a Performance Termination,
shall receive the Severance Pay, Prorated Final Year Bonus, COBRA, Outplacement
Assistance services and Employee Assistance Program services (collectively, the
“Severance Benefits”) set forth below.

Provision
Tier I
(CEO)
Tier I
(Non-CEO Executive Officers)
Tier II
(Grades 3-5)
Other
MAAP-Eligible
(Grade 6)
Salaried
Exempt
Salaried
Non-Exempt
Product-ion
Non-Union
Severance Pay -Termination on or after 12 months employment
2 x the sum of annual Base Pay plus 3 year Average Bonus Amount
1.5 x the sum of annual Base Pay plus 3 year Average Bonus Amount
The sum of annual Base Pay plus 3 year Average Bonus Amount
2 weeks of Base Pay per Year of Service (26 weeks Base Pay minimum)
2 weeks of Base Pay per Year of Service (12 weeks Base Pay minimum)
1 week of Base Pay per Year of Service (6 weeks Base Pay minimum)
1 week of Base Pay per Year of Service (6 weeks Base Pay minimum)
Severance Pay – Termination within first 12 months employment

3 months Base Pay
3 months Base Pay
3 months Base Pay
3 months Base Pay
3 months Base Pay
6 weeks Base Pay
6 weeks Base Pay
Final Year Annual Bonus
Prorated Final Year Bonus (based on actual performance) if Separation from
Service is after March 31 of the performance year
Prorated Final Year Bonus (based on actual performance) if Separation from
Service is after March 31 of the performance year
Prorated Final Year Bonus (based on actual performance for an officer of the
Corporation elected by the Board, or based on target performance for all other
Tier II employees) if Separation from Service is after March 31 of the
performance year
Prorated Final Year Bonus (based on target) if Separation from Service is after
March 31 of the performance year
Prorated Final Year Bonus (based on target) if Separation from Service is after
March 31 of the performance year
N/A
N/A
COBRA

6 months
6 months
6 months
6 months
6 months
6 months
6 months
Outplace-ment Assistance

6 months
6 months
6 months
6 months
3 months
1 month
1 month
EAP

3 months
3 months
3 months
3 months
3 months
3 months
3 months

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(b)
Each Participant who is eligible to receive Severance Benefits due to a
Qualifying Termination as provided in Article III above, and whose termination
of employment is classified by the Employer as a Performance Termination, shall
receive, the Severance Benefits set forth below. Notwithstanding the foregoing,
any Participant who is elected by the Board shall not be eligible to receive a
benefit under this subsection 4.1(b).

Provision
Tier I
(Executive Officers)
Tier II
(Grades 3-5)
Other
MAAP-Eligible
(Grade 6)
Salaried
Exempt
Salaried
Non-Exempt
Production
Non-Union
Severance Pay – Performance Termination
N/A
6 months Base Pay
3 months Base Pay
3 months Base Pay
6 weeks Base Pay
N/A
COBRA 

N/A
6 months
6 months
6 months
6 months
N/A
Outplacement Assistance

N/A
6 months
6 months
3 months
1 month
N/A
EAP

N/A
3 months
3 months
3 months
3 months
N/A

(c)
Severance Pay and payment of any Prorated Final Year Bonus shall be paid as a
lump sum cash payment no later than 60 days following the Participant’s
Termination Date, subject to Section 6.6, provided that should any payments
under this Plan be delayed no interest will be owed to the Participant with
respect to such late payment. Notwithstanding the foregoing, any Prorated Final
Year Bonus that is based on actual performance shall be paid at the same time as
it was payable under the provisions of EOAAP or MAAP but no later than March 15
of the calendar year following the year in which the Termination Date occurs.

(d)
Participants receiving COBRA benefits shall be eligible to receive medical
continuation coverage under COBRA for the number of months provided above if the
Participant is otherwise eligible for, and timely elects, COBRA medical
continuation coverage, and the Employer will pay the applicable monthly premium
during such period. The Participant shall be responsible for any additional
months of COBRA coverage elected beyond the months of COBRA provided by the
Corporation under this Plan. If the Participant is otherwise eligible to enroll
in other applicable COBRA coverage (e.g. dental and/or the health care spending
accounts) and elects to do so, the Participant shall be responsible for and must
pay the COBRA premium for such coverage.

(e)
Participants receiving Outplacement Assistance services and EAP services as part
of their Severance Benefits will receive such services, for the number of months
provided above, under the terms and conditions of the Corporation’s or
Employer’s Outplacement Assistance Program and Employee Assistance Program in
place during such time.

(f)
The Severance Pay determined pursuant to subsection 4.1(a) and (b) above will be
offset by any amount paid to a Participant (but not less than zero) pursuant to

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the Worker Adjustment and Retraining Notification Act (“WARN”), or any similar
state law, in lieu of notice thereunder. The benefits provided under this Plan
are intended to satisfy any and all statutory obligations that may arise out of
an Eligible Employee's involuntary termination, and the Committee shall so
construe and implement the terms of the Plan.

(g)
If, at the time Severance Pay is to be made hereunder, a Participant is indebted
or obligated to an Employer or any affiliate, including, but not limited to, any
repayment under the Employer’s relocation program, then such Severance Benefits
shall be reduced by the amount of such indebtedness or obligation to the extent
allowable under applicable federal or state law; provided that the Employer may
in its sole discretion elect not to reduce the Severance Benefits by the amount
of such indebtedness or obligation and provided that any such election by the
Employer shall not constitute a waiver of its claim of such indebtedness or
obligation, in accordance with applicable law.

(h)
Notwithstanding any provision in the Plan to the contrary, Severance Benefits
for a Participant shall be reduced by the amount of any other severance payments
or benefits paid to the Participant, whether under any severance plan or offer
letter or other individual agreement, made by an Employer.

(i)
Severance Benefits hereunder shall not be considered “compensation” for purposes
of determining any benefits provided under any pension, savings, or other
benefit plan maintained by an Employer.

4.2
Withholding. A Participant shall be responsible for payment of any federal,
Social Security, state, local or other taxes on Severance Benefits under the
Plan. The Employer shall deduct from Severance Benefits any federal, Social
Security, state, local or other taxes which are subject to withholding, as
determined by the Employer, which may be at supplemental withholding rates.

4.3
Recovery of Overpayments. If it is determined that any amount paid to an
individual under this Plan should not have been paid or should have been paid in
a lesser amount, written notice thereof shall be given and such individual shall
promptly repay the amount of the overpayment to the Plan.  Notwithstanding the
foregoing, the Plan in all cases reserves the right to pursue collection of any
remaining overpayments if the above recovery efforts under this paragraph have
failed. 

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ARTICLE V

PLAN ADMINISTRATION

BENEFITS ADMINISTRATION COMMITTEE

5.1
Membership. The Committee shall consist of at least three persons who shall be
officers or directors of the Corporation or Eligible Employees. Members of the
Committee shall be appointed from time to time by, and shall serve at the
pleasure of, the Chief Human Resources Officer of the Corporation (the “CHRO”).
The CHRO shall appoint one of the members of the Committee to serve as chairman.
If the CHRO does not appoint a chairman, the Committee, in its discretion, may
elect one of its members as chairman. The Committee shall appoint a secretary
who may be but need not be, a member of the Committee. The Committee shall not
receive compensation for its services. Committee expenses shall be paid by the
Corporation.

5.2
Powers. The Committee shall have all such powers as may be necessary to
discharge its duties hereunder, including, but not by way of limitation, the
power to construe or interpret the Plan, to determine all questions of
eligibility hereunder, to adopt rules relating to coverage, and to perform such
other duties as may from time to time be delegated to it by the Board. Any
interpretations of this Plan by persons other than the Committee or individuals
or organizations to whom the Committee has delegated administrative duties shall
have no effect hereunder. The Committee may prescribe such forms and systems and
adopt such rules and methods and tables as it deems advisable. It may employ
such agents, attorneys, accountants, actuaries, medical advisors, or clerical
assistants (none of whom need be members of the Committee) as it deems necessary
for the effective exercise of its duties, and may delegate to such agents any
power and duties, both ministerial and discretionary, as it may deem necessary
and appropriate. Notwithstanding the foregoing, any claim which arises under any
other plan shall not be subject to review under this Plan, and the Committee's
authority under this Article V shall not extend to any matter as to which an
Administrator under such other plan is empowered to make determinations under
such plan. In administering the Plan, the Committee will be entitled, to the
extent permitted by law, to rely conclusively on all tables, valuations,
certificates, opinions and reports which are furnished to, or in accordance with
the instructions of, the Committee, or by accountants, counsel or other experts
employed or engaged by the Committee.

5.3
Procedures. The Committee may take any action upon a majority vote at any
meeting at which all members are present, and may take any action without a
meeting upon the unanimous written consent of all members. All action by the
Committee shall be evidenced by a certificate signed by the chairperson or by
the secretary to the Committee. The Committee shall appoint a secretary to the
Committee who need not be a member of the Committee, and all acts and
determinations of the Committee shall be recorded by the secretary, or under his
or her supervision. All such records, together with such other documents as may
be necessary for the administration of the Plan, shall be preserved in the
custody of the secretary.

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5.4
Rules and Decisions. All rules and decisions of the Committee shall be uniformly
and consistently applied to all Eligible Employees and Participants under this
Plan in similar circumstances and shall be conclusive and binding upon all
persons affected by them.

5.5
Books and Records. The records of the Employers shall be conclusive evidence as
to all information contained therein with respect to the basis for participation
in the Plan and for the calculation of Severance Benefits.

5.6
Claim Procedure. The Committee procedure for handling all claims hereunder and
review of denied claims shall be consistent with the provisions of ERISA. If a
claim for Plan benefits is denied, the Committee shall provide a written notice
within 90 days to the person claiming the benefits that contains the specific
reasons for the denial, specific references to Plan provisions on which the
Committee based its denial and a statement that the claimant may (a) request a
review upon written application to the Committee within 60 days, (b) may review
pertinent Plan documents and (c) may submit issues and comments in writing. If a
claim is denied because of incomplete information, the notice shall also
indicate what additional information is required. If additional time is required
to make a decision on the claim, the Committee shall notify the claimant of the
delay within the original 90-day period. This notice will also indicate the
special circumstances requiring the extension and the date by which a decision
is expected. This extension period may not exceed 90 days beyond the end of the
first 90-day period.

The claimant may request a review of a denied claim by writing the Committee.
The appeal must, however, be made within 60 days after the claimant's receipt of
notice of the denial of the claim. Pertinent documents may be reviewed by the
Participant in preparing an appeal, and issues and comments may be submitted in
writing. An appeal shall be reviewed by the Committee, and a written decision,
including reasons, shall be provided within 60 days. If additional time is
required to review the appeal, the Committee shall notify the claimant in a
written notice within the original 60 day period of its receipt of the appeal
and indicating that the decision will be delayed. A final decision on the appeal
shall be made within 120 days of the Committee's receipt of the appeal.

The Committee shall have all of the authority with respect to all aspects of
claims for benefits under the Plan, and it shall administer this authority in
its sole discretion.

5.7    Committee Discretion.

(a)
Any action on matters within the discretion of the Committee, including but not
limited to, the amount of Severance Benefits conferred upon a Participant, shall
be final and conclusive as to all parties. The Committee shall exercise all of
the powers, duties and responsibilities set forth hereunder in its sole
discretion. Notwithstanding anything in this Plan to the contrary, the Committee
shall have the sole discretion to interpret the operation and terms of the Plan,
including but not limited to, whether a Participant has experienced a Qualifying
Termination, whether a Participant’s termination is for Cause, whether a
Participant is offered a Comparable Position, and whether Severance Benefits
shall be payable to any Participant under this Plan.

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(b)
An increase or decrease in the amount of Severance Benefits for Eligible
Employees who are not elected by the Board, different than the amount set forth
in 4.1(a) and (b) above may be authorized in their sole discretion by (i) the
Committee, (ii) a Group President or Senior Vice President of the Corporation
with the endorsement of either the Senior Vice President Global Human Resources
or the Vice President Compensation and Benefits or (iii) the Chief Executive
Officer. Any such increase or decrease in the amount of Severance Benefits shall
be final and conclusive as to all parties.

(c)
An increase or decrease in the amount of Severance Benefits for Eligible
Employees who are elected by the Board, different than the amount set forth in
4.1(a) and (b) above, may be authorized in their sole discretion by the
Compensation Committee of the Board. Any such increase or decrease in the amount
of Severance Benefits shall be final and conclusive as to all parties.

 
5.8
Plan Amendments. The Board may from time to time modify, alter, amend or
terminate the Plan. Any action permitted to be taken by the Board under the
foregoing provision may be taken by the CHRO if such action:

(a)
is required by law, or

(b)
is estimated not to increase the annual cost of the Plan by more than
$5,000,000, or

(c)
is estimated not to increase the annual cost of the Plan by more than
$25,000,000 provided such action is approved and duly executed by the Chief
Executive Officer.

Any action taken by the Board or CHRO shall be made by or pursuant to a
resolution or action duly adopted by the Board or CHRO and shall be evidenced by
such resolution or by a written instrument executed by such persons as the Board
or CHRO shall authorize for that purpose.

The Board or CHRO also shall have the right to make any amendment retroactively
which is necessary to bring the Plan into conformity with the Code or which is
otherwise permitted by applicable law. Any such amendment will be binding and
effective for the Employer.

Any action which is required or permitted to be taken by the Board under the
provisions of this Plan may be taken by the Compensation Committee of the Board
or any other duly authorized committee of the Board designated under the By-Laws
of the Corporation.

The Board, the Compensation Committee or any duly authorized committee of the
Board, the Chief Executive Officer or the CHRO may authorize persons to carry
out its policies and directives subject to the limitations and guidelines set by
it, and delegate its authority under the Plan.

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5.9
Delegation of Duties. This Plan is sponsored by the Corporation. The Committee
reserves the right to delegate any and all administrative duties to one or more
individuals or organizations. Any reference herein to any other entity or
person, other than the Committee or any of its members, which is performing
administrative services shall also include any other third party administrators.
The responsibilities of any third party administrator may be governed, in part,
by a separate administrative services contract.

5.10
Funding. Severance Benefits shall be paid from the general assets of the
Employer.

ARTICLE VI

LIMITATIONS AND LIABILITIES

6.1
Non-Guarantee of Employment. Nothing contained in this Plan shall be construed
as a contract of employment between an Employer and a Participant, or as a right
of any Participant to continue in the employment of an Employer, or as a
limitation of the right of an Employer to discharge any Participant with or
without Cause. Nothing contained in this Plan shall affect the eligibility
requirements under any other plans maintained by the Employer, nor give any
person a right to coverage under any other Plan.

6.2
Non-Alienation. Except as otherwise provided herein, no right or interest of any
Participant or Beneficiary in the Plan shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
charge, attachment, garnishment, execution, levy, bankruptcy, or any other
disposition of any kind, either voluntary or involuntary, prior to actual
receipt of payment by the person entitled to such right or interest under the
provisions hereof, and any such disposition or attempted disposition shall be
void.

6.3
Applicable Law. This Plan is construed under, to the extent not preempted by
federal law, enforced in accordance with and governed by, the laws of the State
of Delaware. If any provision of this Plan is found to be invalid, such
provision shall be deemed modified to comply with applicable law and the
remaining terms and provisions of this Plan will remain in full force and
effect.

6.4
Notice. Any notice given hereunder is sufficient if given to a Participant by
the Employer, or if mailed to the Participant to the last known address of the
Participant as such address appears on the records of the Employer.

6.5
Service of Process. The Chair of the Committee shall be the designated recipient
of the services of process with respect to legal actions regarding the Plan.

6.6
No Guarantee of Tax Consequences. It is intended that the payments and benefits
provided under the Plan shall either be exempt from the application of, or
comply with, the requirements of Section 409A of the Code. The Plan shall be
construed in a manner that effects such intent. Nevertheless, the tax treatment
of the benefits provided under the Plan is not warranted or guaranteed. Neither
the Corporation or any other Employer nor its respective directors, officers,
employees or advisers (other than in his or her

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capacity as a Participant) shall be held liable for any taxes, interest,
penalties or other monetary amounts owed by any Participant or other taxpayer as
a result of the Plan.

Notwithstanding anything in the Plan to the contrary, to the extent that any
amount or benefit that would constitute non-exempt “deferred compensation” for
purposes of Section 409A of the Code (“Non-Exempt Deferred Compensation”) would
otherwise be payable or distributable under the Plan by reason of the occurrence
of the Participant’s termination of employment, such Non-Exempt Deferred
Compensation will not be payable or distributable to the Participant by reason
of such circumstance unless the circumstances giving rise to such termination of
employment meet any description or definition of “separation from service” in
Section 409A of the Code and applicable regulations (without giving effect to
any elective provisions that may be available under such definition). If this
provision prevents the payment or distribution of any Non-Exempt Deferred
Compensation, such payment or distribution shall be made on the date, if any, on
which an event occurs that constitutes a Section 409A-compliant “separation from
service.” Each payment of Severance Benefits pursuant to this Plan shall be
considered a separate payment, as described in Treas. Reg. Section
1.409A-2(b)(2), for purposes of Section 409A of the Code.

Whenever in this Plan a payment or benefit is conditioned on the Participant’s
execution of a Separation Agreement, the Separation Agreement must be executed
and all revocation periods shall have expired in accordance with terms set forth
therein, but in no case later than sixty (60) days after the Termination Date;
failing which such payment or benefit shall be forfeited. If such payment or
benefit constitutes Non-Exempt Deferred Compensation, then such payment or
benefit (including any installment payments) that would have otherwise been
payable during such 60-day period shall be accumulated and paid on the 60th day
after the Termination Date provided such release shall have been executed and
such revocation periods shall have expired. If such payment or benefit is exempt
from Section 409A of the Code, the Corporation may elect to make or commence
payment at any time during such 60-day period.

6.7
Limitation of Liability. Neither the Corporation or any other Employer nor the
Committee shall be liable for any act or failure to act which is made in good
faith pursuant to the provisions of the Plan, except to the extent required by
applicable law. It is expressly understood and agreed by each Eligible Employee
who becomes a Participant that, except for its or their willful misconduct or
gross neglect, neither the Corporation or any other Employer nor the Committee
shall be subject to any legal liability to any Participant, for any cause or
reason whatsoever, in connection with this Plan, and each such Participant
hereby releases the Corporation, its Subsidiaries, their officers and agents,
and the Committee, from any and all liability or obligation except as provided
in this paragraph.

6.8
Indemnification of the Committee. The Corporation shall indemnify the Committee
and each of its members and hold them harmless from the consequences of their
acts or conduct in their official capacity, including payment for all reasonable
legal expenses and court costs, except to the extent that such consequences are
the result of their own willful misconduct or breach of good faith.

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APPENDIX A

SUBSIDIARIES NOT PARTICIPATING IN THE HALYARD HEALTH, INC.
SEVERANCE PAY PLAN

 
 

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