Exhibit 10.32

 

NATIONAL STARCH LLC

 

SEVERANCE PLAN FOR

 

FULL TIME AND PART TIME NON-UNION EMPLOYEES

 

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TABLE OF CONTENTS

 

ARTICLE I

PURPOSE AND EFFECTIVE DATE

1

1.1

Purpose

1

1.2

Effective Date

1

ARTICLE II

DEFINITIONS

2

2.0

 

2

2.1

Adjusted Service Date

2

2.1.1

 

2

2.1.2

 

2

2.1.3

 

2

2.1.4

 

3

2.1.5

 

4

2.2

Administrative Committee

4

2.3

Administrator

4

2.4

Base Compensation

4

2.5

Board

5

2.6

Cause

5

2.7

COBRA Coverage

5

2.8

Code

5

2.9

Company

5

2.10

Employee

5

2.11

Excess Severance Payment

5

2.12

ERISA

5

2.13

Former National Starch Employee

5

2.14

Group

6

2.15

Henkel Group

6

2.16

Involuntary Termination

6

2.16.1

 

6

2.16.2

 

6

2.16.3

 

6

2.16.4

 

6

2.16.5

 

6

2.16.6

 

6

2.16.7

 

7

2.17

Notice of Termination

7

2.18

Part-Time Employee

7

2.19

Participant

7

2.20

Payment Due Date

7

2.21

Plan

7

2.22

Plan Year

7

2.23

Prior Severance Payment

7

2.24

Release

8

2.25

§

8

2.26

Separation From Service

8

 

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2.26.1

Permanent, Significant Reduction In Hours Worked

8

2.27

Severance Payment

8

2.28

Shareholder

8

2.29

Specified Participant

8

2.30

Temporary Employee

9

2.31

Termination Date

9

2.32

Week’s Compensation

9

2.33

Year of Service

9

ARTICLE III

PARTICIPATION

10

3.1

Eligibility

10

3.2

Ineligible Salaried Employees

10

3.3

Sale of Business Rule

11

3.4

Death, Termination For Cause, or Resignation

12

3.5

Disability

12

ARTICLE IV

BENEFITS

13

4.1

Notice; Pay in Lieu of Notice

13

4.2

Additional Benefits - With Release

13

4.2.1

Severance Payment

13

4.2.2

Outplacement

14

4.2.3

Six Month Retiree Medical/COBRA Coverage Subsidy

14

4.3

Maximum Severance Payment

15

4.4

Specified Participant Rule

15

ARTICLE V

PLAN ADMINISTRATION

16

5.1

Operation of the Plan

16

5.2

External Audits

16

5.3

Named Fiduciary

16

5.4

Returned Checks

16

5.5

Fees and Expenses

16

5.6

Rules for Administering the Plan

16

ARTICLE VI

CLAIMS

18

6.1

General

18

6.2

Denial

18

6.3

Appeals

18

ARTICLE VII

PLAN AMENDMENTS

20

7.1

Amending Authority

20

7.1.1

 

20

7.1.2

 

20

7.2

Plan Termination

20

ARTICLE VIII

GENERAL

21

8.1

Summary Plan Description

21

8.2

Right of Setoff

21

8.3

Governing Law

21

8.4

Impact On Other Benefits

21

8.5

Tax Withholding

22

8.6

Section 409A

22

 

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ARTICLE I

 

PURPOSE AND EFFECTIVE DATE

 

1.1          Purpose.  The purpose of the National Starch LLC Severance Plan For
Full Time and Part-Time Non-Union Employees (the “Plan”) is to provide eligible
employees who are involuntarily terminated from employment by the Company with
the benefits set forth in this Plan.

 

1.2          Effective Date.  The Plan is effective on April 1, 2008.

 

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ARTICLE II

 

DEFINITIONS

 

2.0          The following words and phrases used in this Plan shall be given
the meanings stated unless different meanings are clearly required by the
context in which used.  The headings and titles of articles are given solely for
convenience of reference and shall not be deemed to modify or affect in any way
the text or meaning of the article or section to which appended.  Capitalized
nouns are used throughout the Plan text for the terms defined by this and other
Articles.  Pronouns, wherever used, shall be deemed to include both plural and
singular as well as masculine and feminine.

 

2.1          “Adjusted Service Date” means, unless otherwise provided in a
Benefit Schedule, the first day of an Employee’s employment with the Group;
adjusted to reflect breaks in service under rules promulgated by the
Administrator and the rules set out below.

 

2.1.1       To the extent provided in this Plan, or an agreement between a
member of the Group and a predecessor employer or an affiliate of such
predecessor employer, or a resolution of the Board, the Adjusted Service Date
may reflect service recognized by a predecessor employer that was not a member
of the Group at the time the service was performed.

 

2.1.2       Except as provided in subsection 2.1.4, below, if an Employee ceases
to be employed by the Group for the reasons stated under the Sale of Business
Rule of Section 3.3, and is subsequently reemployed by the Group, and the new
organization, immediately following the transaction, recognizes service
recognized by this Plan for purposes of severance, the Adjusted Service Date
shall be based on the date the Employee is reemployed.  Such prior service shall
not be used to determine the Adjusted Service Date or Years of Service.

 

2.1.3       If an Employee has received a Prior Severance Payment on account of
a prior termination of employment from a member of the Group or predecessor
employer,

 

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service used to determine such Prior Severance Payment shall not be used to
determine the Adjusted Service Date or Years of Service.  However, the
Administrator may use such service to determine the Adjusted Service Date and
Years of Service if the reemployed Employee pays to the Company an amount equal
to one hundred percent (100%) of such Prior Severance Payment prior to receipt
of a subsequent Notice of Termination or such shorter time period set by the
Administrator.

 

2.1.4       Notwithstanding the above, Service with a predecessor employer shall
be recognized to determine the Adjusted Service Date and Years of Service for
the Employee groups described, below:

 

Employee Group

 

Service Recognized

 

 

 

Employees who transferred to the books of the Company effective April 1, 2008
from Indopco, Inc. d/b/a National Starch and Chemical Company.

 

Pre-April 1, 2008 service recognized under the National Starch and Chemical
Company Severance Plan For Full Time and Part Time Non-Union Employees.

 

 

 

Employees who transfer to the books of the Company from ICI Group Services Inc.
on or after April 1, 2008 and prior to the date the Company ceases to be a
member of the Group in which Akzo Nobel N.V. is the ultimate parent.

 

Pre transfer service recognized under the ICI Severance Plan For Corporate Staff
or any successor severance plan.

 

 

 

Employees who transfer to the books of the Company from The Glidden Company on
or after April 1, 2008 and prior to the date the Company ceases to be a member
of the Group in which Akzo Nobel N.V. is the ultimate parent.

 

Pre transfer service recognized under the Termination and Cash Payment Plan of
ICI Paints or any successor severance plan.

 

 

 

“IT Employees” as that term is defined in the Master Implementation Agreement by
and between Akzo Nobel N.V. and

 

Pre-April 3, 2008 service recognized under the National Starch and Chemical
Company Severance Plan For Full Time and Part Time Non-Union Employees plus
service

 

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Henkel KGaA dated April 3, 2008, who transfer to the books of the Company after
April 2, 2008 and prior to April 1, 2010 from the Henkel Group.

 

with the Henkel Group on or after April 3, 2008 through the day prior to the
date of transfer to the Company from the Henkel Group.

 

 

 

Former National Starch Employees hired on or after April 1, 2008 and prior to
January 1, 2010 and did not receive a Prior Severance Payment from the Henkel
Group.

 

Pre-April 3, 2008 service recognized under the National Starch and Chemical
Company Severance Plan For Full Time and Part Time Non-Union Employees.

 

2.1.5       Service for any given period of time may only be counted once in
determining the Adjusted Service Date or Years of Service.

 

2.2          “Administrative Committee” means the committee appointed by the
Board to perform the duties of the Administrative Committee; provided that until
such time as the Company ceases to be a member of the Group of which Akzo Nobel
N.V. is the ultimate parent, the Administrative Committee shall be the Employee
Benefits Administration Committee of ICI American Holdings Inc.

 

2.3          “Administrator” means the Company or such persons designated by it
to assume the duties of the Administrator.

 

2.4          “Base Compensation” means the annualized base salary rate and, if
applicable, annualized sales commissions of a Participant determined as of the
Termination Date.  Base Compensation includes pre-tax employee contributions
under any qualified defined contribution plan with a Code
Section 401(k) arrangement, salary deferrals under any unfunded, nonqualified
plan maintained by the Company for management employees, and amounts deferred
(including employee premiums) under a flexible spending account established
pursuant to Section 125 of the Code.  Base Compensation does not include
overtime, shift differential, long term incentive award payments, short term
incentive bonuses or any other form of compensation which is not described in
the preceding sentences of this Section.

 

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2.5          “Board” means the Board of Managers of National Starch LLC.

 

2.6          “Cause” means termination of employment by action of the Company
for dishonesty, insubordination, flagrant violation of rules and regulations of
the Company, negligence, misconduct, or commission of a felony.

 

2.7          “COBRA Coverage” means federally-mandated health and dental
continuation coverage.  For purposes of this Plan, COBRA Coverage does not
include continuation coverage for a Code Section 125 Healthcare Spending
Account.

 

2.8          “Code” means the Internal Revenue Code of 1986, as amended.

 

2.9          “Company” means National Starch LLC.

 

2.10        “Employee” means any person in pay status with the Company who is a
common law employee of the Company and is identified in the human resources
information system, payroll system or other records of the Company as an
Employee.  Consultants, independent contractors and other individuals not
classified by the Company as Employees are not Employees.

 

2.11        “Excess Severance Payment” means the portion of any Severance
Payment that exceeds two (2) times the Code § 401(a)(17) limit in effect for the
calendar year in which the Participant’s Separation From Service occurs.

 

2.12        “ERISA” means the Employee Retirement Income Security Act of 1974,
as amended.

 

2.13        “Former National Starch Employee” means an Employee (other than an
IT Employee referenced in subsection 2.1.4) who was employed by Indopco, Inc.,
Ablestik Laboratories or Acheson Industries Inc. on April 3, 2008 when those
companies were sold by ICI American Holdings Inc. to an affiliate of Henkel
KGaA.

 

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2.14        “Group” means the Company, the ultimate parent of the Company, and
any entity in which the ultimate parent directly or indirectly holds at least a
fifty percent (50%) ownership interest, in value or voting power.  As of the
Effective Date, the ultimate parent was Akzo Nobel N.V.

 

2.15        “Henkel Group” means Indopco, Inc., Acheson Industries, Inc. and
Ablestik Laboratories or any successor thereto in which Henkel KGaA holds,
directly or indirectly, a fifty percent (50%) or more ownership interest.

 

2.16        “Involuntary Termination” means the involuntary termination of
employment from the Group by reason of the elimination of a job position or a
reduction in force subject to the rules of subsections 2.16.1 through 2.16.7
below.

 

2.16.1     A voluntary resignation is not an Involuntary Termination.

 

2.16.2     A termination of employment described in Section 3.3 or 3.4 is not an
Involuntary Termination.

 

2.16.3     A transfer of employment from one member of the Group to another is
not an Involuntary Termination.

 

2.16.4     A termination of employment for Cause is not an Involuntary
Termination.

 

2.16.5     A termination of employment initiated by the Company where the
Company in its sole discretion has determined that the Employee is unable to
perform his job satisfactorily is not an Involuntary Termination.

 

2.16.6     If an eligible Employee is offered a full time equivalent position by
a member of the Group prior to his Termination Date, is not required to
relocate, and refuses the position, such Employee’s subsequent termination of
employment by the Company is not an Involuntary Termination.

 

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2.16.7     If an Employee has a written contract of employment for a fixed term,
the termination of the Employee at the end of such fixed term is not an
Involuntary Termination.

 

2.17        “Notice of Termination” means the oral or written notice given to a
Participant specifying his Termination Date; provided that the Notice of
Termination need not specify the exact date so long as a “not earlier than date”
is specified in the notice.

 

2.18        “Part-Time Employee” means an Employee who is employed on a less
than full-time basis who is identified on the human resources information system
and other records of the Company in a classification that anticipates that the
Employee will be employed at twenty (20) or more hours per week on a continuous
basis as compared to a temporary or seasonal basis.

 

2.19        “Participant” means an Employee of the Company who satisfies the
eligibility criteria of Article III.

 

2.20        “Payment Due Date” means the date stated in the Release by which
payment must be made.  The Payment Due Date may not be later than the March 15
following the calendar year of the Termination Date.  If the Payment Due Date is
not stated in the Release, the Payment Due Date may be no later than fifteen
(15) days and two months following the Termination Date.

 

2.21        “Plan” means the National Starch LLC Severance Plan For Full Time
and Part-time Non-Union Employees.

 

2.22        “Plan Year” means the calendar year; provided that the initial Plan
Year shall be a short year beginning April 1 2008 and ending December 31, 2008.

 

2.23        “Prior Severance Payment” means a severance, separation or other
payment made to an Employee on account of a prior termination of employment from
the Company or the Group, or a predecessor employer, to the extent such payment
was based on service that would be

 

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recognized by this Plan to determine the Adjusted Service Date or Years of
Service if such payment had not been made.

 

2.24        “Release” means an irrevocable, binding release, in the form
prescribed by the Company, which must be executed by a Participant to receive
the benefits described in Section 4.2.

 

2.25        “§” means Section.

 

2.26        “Separation From Service” means the Participant’s termination of
employment with the Company and the Group by reason of death, retirement or
otherwise.  Except as otherwise provided in subsection 2.26.1, below, the
provisions of Treasury Regulations § 1.409A-1(h) shall be applied in determining
when a termination of employment has occurred.

 

2.26.1    Permanent, Significant Reduction In Hours Worked.  Separation From
Service will also occur on the date after which the Employer and the Participant
reasonably anticipate a permanent reduction in the level of bona fide services
to be provided by the Participant to the Group to a level that is forty nine
percent (49%) or less of the average level of bona fide services performed
during the twelve (12) months immediately preceding such date.

 

2.27        “Severance Payment” means the lump sum payment described in
Section 4.2

 

2.28        “Shareholder” means any entity that directly owns more than fifty
percent (50%) of the voting power and value of the Company.  On the Effective
Date, the Shareholder was ICI American Holdings Inc.

 

2.29        “Specified Participant” means a Participant who is a “specified
employee” within the meaning of Treasury Regulations § 1.409A-1(i) on his
Separation From Service.  The specified

 

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employee identification date is December 31 of the calendar year preceding the
calendar year of Separation From Service.

 

2.30        “Temporary Employee” means any Employee (other than a Part-Time
Employee) who is hired to perform seasonal, temporary, part-time or other
services on a less than full-time basis.

 

2.31        “Termination Date” means the date that a Participant’s employment is
terminated by the Company pursuant to the Notice of Termination.

 

2.32        “Week’s Compensation” means one fifty-second (1/52) of a
Participant’s Base Compensation.

 

2.33        “Year of Service” means a twelve (12) month period measured from a
Participant’s Adjusted Service Date and each anniversary thereof.

 

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ARTICLE III

 

PARTICIPATION

 

3.1          Eligibility.  Except as otherwise provided in this Article, every
full time and part-time non-union Employee of the Company shall be eligible for
a benefit under this Plan if he terminates employment with the Group by reason
of an Involuntary Termination.  Any Employee who becomes entitled to a benefit
under this Plan by reason of the preceding sentence is referred to as a
Participant.  Eligibility to participate shall end when the Employee ceases to
be a full time or part-time Employee of the Company or becomes ineligible by
reason of Section 3.2.

 

3.2          Ineligible Salaried Employees.  Even if the criteria of Section 3.1
are met, the following Employees are not eligible to participate in this Plan:

 

(i)            Temporary Employees;

 

(ii)           Employees who are members of a collective bargaining unit to
which this Plan has not been extended by a collective bargaining agreement;

 

(iii)          Employees entitled to a severance type payment under any other
plan, policy, arrangement, or agreement which would obligate the Company or
other member of the Group to make such payment;

 

(iv)          Leased employees within the meaning of Section 414(n) of the Code;

 

(v)           Nonresident aliens who are not performing services for the Group
in the United States;

 

(vi)          Any Employee who has agreed in writing that he is not eligible for
a benefit under this Plan or for severance benefits in general;

 

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(vii)         Any secondee or other Employee who has an enforceable right to
resume employment or to be recalled to employment with any member of the Group;

 

(viii)        Any individual who is a student working for the Company as an
intern or cooperative;

 

(ix)           Any Employee who has been seconded to the Company on an
international assignment from a non-U.S. member of the Group;

 

(x)            Any Employee who detassels corn or performs other agricultural
work; and

 

(xi)           Any consultant, independent contractor or other individual who is
not classified as an Employee by the Company without regard to any determination
by the Internal Revenue Service, Department of Labor or other governmental
agency, that such individual is a common law employee of the Company.

 

3.3          Sale of Business Rule.  In the case where an otherwise eligible
Employee is no longer employed by the Group because of the sale of the stock of
the Company or any member of the Group, but the Employee continues to be
employed by the Company, such Employee is not eligible for benefits under this
Plan.  In the case of the sale, lease, or other transfer of all or a portion of
the assets, products, services or operations of the Company to another
organization outside the Group, an otherwise eligible Employee is not eligible
for benefits under the Plan if either of the following occurs:

 

(i)            the Employee is employed by the new organization immediately
following the sale, transfer or lease or is so employed within a time period
specified in an agreement between the Company and the new organization; or

 

(ii)           the Company terminates the employment of an Employee who did not
accept an offer of employment from the new organization where the new
organization offered compensation which was comparable to the compensation
provided by the Company and

 

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did not require the Employee to relocate more than fifty (50) miles from his
place of employment as a condition of being employed by the new organization. 
If the Base Compensation offered by the new organization to such Employee is
equal or greater than Base Compensation provided by the Company, compensation is
deemed to be comparable for purposes of this clause (ii).

 

3.4          Death, Termination For Cause, or Resignation.  If an otherwise
eligible Employee who has been given a Notice of Termination dies, is terminated
for Cause, or resigns prior to his Termination Date, neither he nor his heirs or
assignees, shall be entitled to receive any benefits under this Plan.

 

3.5          Disability.  If an otherwise eligible Employee who has been given a
Notice of Termination is absent on his Termination Date by reason of a
disability, such Employee will not be entitled to benefits under this Plan,
unless he waives the right to any short-term or long-term disability benefits
payable after the Termination Date under any employee welfare benefit plan
maintained or sponsored by the Company or another member of the Group.

 

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ARTICLE IV

 

BENEFITS

 

4.1          Notice; Pay in Lieu of Notice.  A Participant shall be provided
advance oral or written notification of his Termination Date through a Notice of
Termination.  The Notice of Termination will provide a minimum period of two
weeks’ notice.  If the Termination Date set out in the Notice of Termination
occurs prior to the end of the minimum notice period, the Company shall pay the
Participant in lieu of such notice an amount equal to the Two Weeks’
Compensation he would be entitled to as minimum notice less the number of full
or partial Weeks’ Compensation attributable to the period of actual notice.  A
Notice of Termination is deemed delivered on the earlier of (i) the date it is
given orally; (ii) the date a written Notice of Termination is hand delivered,
or (iii) the third day following the deposit in the U.S. mail of a written
Notice of Termination.

 

4.2          Additional Benefits - With Release.  If a Participant executes a
binding, irrevocable Release by the date prescribed by the Company (which shall
not in any event be later than 2-1/2 months following the year in which the
Termination Date occurred), he shall be entitled to the benefits described in
this Section.

 

4.2.1       Severance Payment.  In addition to notice or pay in lieu of notice,
a Participant shall be paid a lump sum Severance Payment on or after his
Termination Date  but no later than the Payment Due Date.  The Severance Payment
will be equal to the greater of the Minimum Severance Payment or the amount
determined in accordance with the following formula:

 

Severance Payment = Two Weeks’ Compensation x Full Years of Service x Age Factor

 

The Age Factor is determined by the Participant’s age on his Termination Date
from the following table:

 

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Age on Termination Date

 

Factor

 

40 through 44 years inclusive

 

1.10

 

45 through 49 years inclusive

 

1.20

 

50 through 54 years inclusive

 

1.30

 

55 through 59 years inclusive

 

1.40

 

60 years or more

 

1.50

 

 

The Minimum Severance Payment is 12 Weeks’ Compensation, except that
Participants in Job Class 27 or above shall have a Minimum Severance Payment of
52 Weeks’ Compensation.  With respect to any Participant with less than 6 full
Years of Service, the Minimum Severance Payment will be reduced by the number of
weeks of notice or pay in lieu of notice given the Participant under
Section 4.1; provided that the Minimum Severance payment of 52 Week’s
Compensation for Job Class 27 may not be reduced below 46 weeks’ compensation.

 

4.2.2       Outplacement.  The Company will provide outplacement services to
Employees who are exempt from the Fair Labor Standards Act.  The amount and type
of outplacement services provided to an exempt Employee shall be determined by
the Company, consistent with the past practice of the Company; provided that in
no event will outplacement services be provided to a Participant after the last
day of the second taxable year following the taxable year of Separation From
Service.  For the avoidance of doubt, the proviso of the preceding sentence does
not create an obligation of the Company to provide outplacement services for
that period of time.

 

4.2.3       Six Month Retiree Medical/COBRA Coverage Subsidy.  If a Participant
executes a binding Release and timely elects COBRA Coverage, the Company shall
subsidize, for six months following the month in which the Termination Date
occurs, the difference between the amount normally charged to similarly situated
COBRA participants and the amount charged to active employees for the same level
of coverage.  If such a Participant is eligible for retiree medical and dental
benefits under a group health plan maintained by

 

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the Company and elects retiree medical and dental instead of COBRA Coverage, the
Company will subsidize the full cost of such coverage for six (6) months
following the Termination Date.

 

4.3          Maximum Severance Payment.  Notwithstanding any other provision of
this Plan, the Severance Payment may not exceed a maximum of 104 Weeks’
Compensation.

 

4.4          Specified Participant Rule.  Notwithstanding any other provision of
this Plan, the Excess Severance Payment due a Specified Participant shall be
paid no earlier than the first day of the seventh (7th) month following the
month of his Separation From Service.

 

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ARTICLE V

 

PLAN ADMINISTRATION

 

5.1          Operation of the Plan.  The Administrator shall carry out the
provisions of the Plan except to the extent its duties have been delegated to
persons designated by resolution of the Administrator except as otherwise
provided in this Plan.  The Administrator has the authority to appoint agents to
carry out its fiduciary responsibilities and to remove same.  The Administrator
shall establish the terms and conditions under which such agents serve, and
shall evaluate their performance.

 

5.2          External Audits.  The Administrator shall arrange for external
audits of Plan operations sufficient to meet requirements of law and generally
accepted business practice.

 

5.3          Named Fiduciary.  The Administrator is the “named fiduciary”
required by law with respect to operation of the Plan.

 

5.4          Returned Checks.  If any check payable to a Participant is returned
for any reason, the payment shall revert to the general assets of the Company
and the Participant shall forfeit all rights to such payment, unless a claim is
filed with the Administrator no later than three (3) years after the date the
check was drawn.

 

5.5          Fees and Expenses.  The Company shall pay the fees of third parties
providing services to the Plan.

 

5.6          Rules for Administering the Plan.  The Administrator, in its sole
discretion, may establish rules for the administration of the Plan, prescribe
appropriate forms, and adopt procedures for the handling and denial of claims. 
Except as specifically provided elsewhere in this Plan, the Administrator shall
have the exclusive right to interpret, construe, and implement the provisions of
the Plan.  The Administrator shall decide all questions concerning the Plan and
its administration, including without limitation, the determination of
eligibility for and the

 

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amount of any benefits.  The decisions and the records of the Administrator
shall be conclusive and binding upon the Participants and any other person
having any interest under this Plan.

 

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ARTICLE VI

 

CLAIMS

 

6.1          General.  The Administrator will notify Participants of all rights
and obligations under the Plan.  For purposes of this Article, an Employee
making a claim for a benefit shall be referred to as a “claimant.”  The claimant
shall file the claim with and in the manner prescribed by the Administrator. 
The Administrator shall make the initial determination concerning rights of the
claimant and the amount of benefits, if any, payable under this Plan.  Claims
submitted more than one (1) year after the Termination Date are automatically
denied.

 

6.2          Denial.  If the Administrator denies the claim for benefits under
the Plan in whole or in part, the Administrator will notify the claimant in
writing within ninety (90) days of receipt of the claim unless the Administrator
determines that special circumstances require an extension of time to process
the claim.  If an extension of time for processing the claim is required (not to
exceed an additional ninety (90) days beyond the initial 90-day period), the
Administrator will notify the claimant in writing within the initial ninety (90)
day period that extra time is needed.  The extension notice shall indicate the
special circumstances requiring an extension and the date by which the
Administrator expects to render its decision.  Any denial shall be written in a
manner calculated to be understood by the claimant and shall state (i) the
specific reason or reasons for denial; (ii) specific reference to pertinent Plan
provisions on which the denial is based; (iii) a description of any additional
material or information necessary for the claimant to perfect the claim; (iv) an
explanation of why such material or information is necessary; and (v) the steps
to be taken if the claimant wishes to submit his claim for review.

 

6.3          Appeals.  No claimant, or his duly authorized representative, whose
claim is denied in whole in part may, later than sixty (60) days after receipt
of the written notice of denial, (i) make written request for review by the
Administrative Committee; (ii) review, free of charge, documents, records and
other information relevant to the claim; (iii) submit issues and comments in
writing; and/or (iv) submit written evidence or documentation supporting his
claim.  The Administrative Committee shall make and notify claimant of its
decision no later than sixty (60) days after receiving a claimant’s request for
review and any written evidence or statements,

 

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unless the Administrative Committee determines that special circumstances
require additional time (not to exceed an additional sixty (60) days beyond the
initial sixty (60) day period) to review the denial.  If the Administrative
Committee determines that such special circumstances require an extension of
time, the Administrative Committee will notify the claimant in writing within
the initial sixty (60) day period.  The notice of extension shall describe the
special circumstances requiring the extension of time and the date by which the
Administrative Committee expects to render its decision.

 

In the case of a decision upholding the denial of the claim, the Administrative
Committee shall notify the claimant in writing of its decision and shall set
forth in a manner calculated to be understood by the claimant:

 

(i)                                     the specific reason or reasons for
upholding the denial of the claim;

 

(ii)           reference to specific Plan provisions on which the benefit
determination is based;

 

(iii)          a statement that the claimant is entitled, upon request and free
of charge, reasonable access to and copies of the documents, records and other
information relevant to a claim for benefits; and

 

(iv)          a statement of claimant’s rights to bring an action under
Section 502(a) of ERISA.

 

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ARTICLE VII

 

PLAN AMENDMENTS

 

7.1          Amending Authority.

 

7.1.1       Except as provided in subsection 7.1.2, below, the Board shall have
the power to amend the Plan.

 

7.1.2       No amendment may be made to the Plan without the consent of the
Board of Directors, or its equivalent, of the Shareholder the extent that such
amendment:

 

(i)            Provides a subsidy for any employee welfare benefit other than a
subsidy for COBRA Coverage or retiree medical and dental benefits;

 

(ii)           Extends the subsidy for COBRA Coverage beyond one hundred percent
(100%) of the cost of six (6) month’s coverage;

 

(iii)          Increases the Minimum Separation Payment above 12 Weeks’
Compensation;

 

(iv)          Changes the definition of Base Compensation used to calculate the
Payment formula in a manner that would increase the Severance Payment;

 

(v)           Allows the Severance Payment to exceed 104 Weeks’ Compensation; or

 

(vi)          Adds any change of control or similar provisions.

 

7.2          Plan Termination.  The Board may, in its sole discretion, determine
that it is no longer feasible to maintain the Plan.  Upon such a finding, the
Board may terminate the Plan.

 

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ARTICLE VIII

 

GENERAL

 

8.1          Summary Plan Description.  To the extent the summary plan
description or any other writing or any oral communication to an Employee
conflicts with this Plan, the Plan document will control.

 

8.2          Right of Setoff.  The Company may withhold from any pay, in lieu of
notice or Severance Payment when it is paid any and all amounts owed to the
Company by the Participant including, without limitation, the outstanding
balance on any loan to the Employee from the Company, the fair market value of
Company property in the possession of the Participant, and cash advances in
excess of reimbursable expenses.  If the Administrator determines that under
applicable law the above amounts cannot be withheld without the consent of the
Participant, no portion of the pay in lieu of notice or Severance Payment shall
be due under the Plan until the Participant provides such consent.  Without
limiting the foregoing, the Administrator may reduce the amount of any
Separation Payment before it is paid or made available in order to satisfy a
debt of the Participant to the Company or other member of the Group where such
debt is incurred in the ordinary course of the service relationship between the
Participant and the Company; provided that such offset does not exceed $5,000 in
a given year and the reduction is made at the same time and in the same amount
as the debt otherwise would have been due and collected from the Participant by
the Employer.

 

8.3          Governing Law.  The terms of this Plan shall be construed and
enforced to comply with ERISA, the Code and federal common law.  The provisions
of the Plan are intended to control over state law under the preemptive
authority of ERISA.  If any provision of this Plan shall be held illegal or
invalid for any reason, such determination shall not affect the remaining
provisions of this Plan.

 

8.4          Impact On Other Benefits.  Except as otherwise provided herein, any
amounts paid to a Participant under this Plan shall have no effect on the
Participant’s rights or benefits under any other employee benefit plan sponsored
by the Group.  Further, such amounts shall not be used to

 

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determine eligibility for or the amount of any benefit under any employee
benefit plan, policy, or arrangement sponsored by a member of the Group.

 

8.5          Tax Withholding.  The Company shall withhold federal, state, and
local taxes in such amounts as the Company, in its sole discretion, determines
necessary to meet any withholding obligations under the law.

 

8.6          Section 409A.  This Plan is intended to comply with the applicable
requirements of Code § 409A, as amended, and shall be limited, construed and
interpreted in accordance with such intent.  If any provision of this Plan would
cause a Participant to incur any additional tax or interest under Code § 409A,
including any regulations or other guidance issued by the Secretary of Treasury
and the Internal Revenue Service with respect thereto, the Company will use
commercially reasonable efforts to reform such provision.  Notwithstanding the
preceding, neither the Company nor any member of the Group will be liable to the
Participant for any additional taxes, interest or penalties resulting from a
failure to meet the requirements of Code § 409A.

 

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