Exhibit 10.8

 

ALLIANT TECHSYSTEMS INC.

 

INCOME SECURITY PLAN

 

As Amended and Restated

Effective October 29, 2007

 

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CONTENTS

 

SECTION 1.

PURPOSE AND TERM

1

1.1

Purpose

1

1.2

Type of Plan

1

1.3

Term; Effect of Change in Control

1

 

 

 

SECTION 2.

DEFINITIONS

2

2.1

Definitions

2

 

 

 

SECTION 3.

UNPAID COMPENSATION AND SEVERANCE BENEFITS

7

3.1

Right to Unpaid Compensation and Severance Benefits

7

3.2

Severance Benefits for Tier 1 Participants and Tier 2 Participants

8

3.3

Severance Benefits for Tier 1 Participants

9

3.4

Severance Benefits for Tier 2 Participants

10

3.5

Termination Due to Disability or Death

11

3.6

Termination for Cause or by the Participant Without Good Reason

11

3.7

Notice of Termination

11

3.8

Payment of Severance Benefits

11

 

 

 

SECTION 4.

RELEASE AND RESTRICTIVE COVENANTS

11

4.1

Release

11

4.2

Restrictive Covenants

11

4.3

Services of Participant

11

 

 

 

SECTION 5.

TRUST

12

5.1

Establishment of Trust

12

5.2

Trust Assets

12

 

 

 

SECTION 6.

EXCISE TAXES

12

6.1

Gross-Up Payment

12

6.2

Payment Date

13

6.3

Controversies with Taxing Authorities

13

 

 

 

SECTION 7.

CLAIMS PROCEDURE

14

7.1

Original Claim

14

7.2

General Rules

14

 

 

 

SECTION 8.

RIGHTS TO SEVERANCE BENEFITS AND LEGAL FEES

15

8.1

Severance Benefits Payments

15

8.2

Legal Fees and Expenses

15

 

 

 

SECTION 9.

SUCCESSORS

15

9.1

Successors to the Company

15

9.2

Assignment by the Participant

16

 

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SECTION 10.

MISCELLANEOUS

16

10.1

Administration and Committee Powers

16

10.2

Employment Status

16

10.3

Entire Plan and Other Change in Control Plans

16

10.4

Notices

16

10.5

Includable Compensation

16

10.6

Tax Withholding

17

10.7

Severability

17

10.8

Amendment and Waiver

17

10.9

Applicable Law

17

10.10

Rules of Construction

17

 

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ALLIANT TECHSYSTEMS INC.

 

INCOME SECURITY PLAN

 

As Amended and Restated Effective October 29, 2007

 

SECTION 1.                                PURPOSE AND TERM

 

1.1                                 PURPOSE.  THE PURPOSE OF THIS INCOME
SECURITY PLAN (THIS “PLAN”) IS TO PROVIDE INCOME SECURITY PROTECTION TO CERTAIN
EXECUTIVES OF ALLIANT TECHSYSTEMS INC. (THE “COMPANY”) IN ORDER TO (A) ENSURE
THAT SUCH EXECUTIVES MAKE GOOD CORPORATE DECISIONS WITH RESPECT TO A POSSIBLE
CHANGE IN CONTROL (AS DEFINED IN SECTION 2.1) OF THE COMPANY, EVEN IF SUCH A
CHANGE IN CONTROL MAY HAVE ADVERSE PERSONAL CONSEQUENCES (SUCH AS THE LOSS OF
THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY), (B) MAXIMIZE STOCKHOLDER VALUE BY
KEEPING SUCH EXECUTIVES ENGAGED DURING PERIODS OF UNCERTAINTY RELATING TO A
POSSIBLE CHANGE IN CONTROL, AND (C) PROVIDE SUCH EXECUTIVES WITH THE ABILITY TO
TRANSITION TO NEW EMPLOYMENT IF THEIR EMPLOYMENT WITH THE COMPANY IS TERMINATED
AS A RESULT OF A CHANGE IN CONTROL.

 

1.2                                 TYPE OF PLAN.  THIS PLAN IS A SEVERANCE PAY
PLAN MAINTAINED PRIMARILY FOR THE BENEFIT OF A SELECT GROUP OF MANAGEMENT OR
HIGHLY COMPENSATED INDIVIDUALS WITHIN THE MEANING OF ERISA (AS DEFINED IN
SECTION 2.1). THIS PLAN WILL BE ADMINISTERED AND INTERPRETED (I) IN A MANNER
CONSISTENT WITH SUCH INTENT AND (II) IN ACCORDANCE WITH SECTION 409A OF THE CODE
(AS DEFINED IN SECTION 2.1) AND OTHER APPLICABLE TAX (AS DEFINED IN SECTION 2.1)
LAWS AND REGULATIONS, INCLUDING, WITHOUT LIMITATION, ANY REGULATIONS PROMULGATED
PURSUANT TO SECTION 409A OF THE CODE. NOTWITHSTANDING THE FOREGOING, NEITHER THE
COMPANY NOR ANY OF ITS OFFICERS, DIRECTORS, AGENTS OR AFFILIATES WILL BE
OBLIGATED, DIRECTLY OR INDIRECTLY, TO ANY PARTICIPANT FOR ANY TAXES THAT MAY BE
IMPOSED ON SUCH PARTICIPANT (A) ON ACCOUNT OF ANY AMOUNTS DUE OR PAID UNDER THIS
PLAN (EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN SECTION 6) OR (B) ON ACCOUNT OF
ANY FAILURE TO COMPLY WITH ANY PROVISION OF THE CODE.

 

1.3                                 TERM; EFFECT OF CHANGE IN CONTROL»

 

(A)                                  THIS PLAN IS EFFECTIVE ON MARCH 13, 2006
(THE “EFFECTIVE DATE”) AND WILL CONTINUE IN EFFECT UNTIL THIS PLAN IS TERMINATED
BY THE COMMITTEE (AS DEFINED IN SECTION 2.1). THE COMMITTEE MAY TERMINATE THIS
PLAN AT ANY TIME. IF A NOTICE TERMINATING THIS PLAN IS PROPERLY DELIVERED BY THE
COMMITTEE, THIS PLAN, ALONG WITH ALL CORRESPONDING RIGHTS, DUTIES AND COVENANTS,
WILL IMMEDIATELY TERMINATE; PROVIDED, HOWEVER, THAT IN THE EVENT A CHANGE IN
CONTROL OCCURS WITHIN 12 MONTHS AFTER RECEIPT OF SUCH NOTICE, SUCH TERMINATION
OF THE PLAN WILL BE DEEMED NULL AND VOID, AND THE PARTICIPATION OF THE
PARTICIPANTS IN THIS PLAN WILL NOT BE AFFECTED BY SUCH NOTICE (UNLESS SUCH
TERMINATION OF THIS PLAN OR PARTICIPATION BY ANY PARTICIPANT HEREIN IS REQUIRED
BY THE TERMS OF ANY FINAL ORDER OR A FEDERAL OR STATE COURT OR REGULATORY AGENCY
OF COMPETENT JURISDICTION).

 

(B)                                 NOTWITHSTANDING SECTION 1.3(A), IN THE EVENT
THAT A CHANGE IN CONTROL OCCURS DURING THE TERM OF THE PLAN, THE COMMITTEE MAY
NOT TERMINATE THE PLAN DURING THE

 

1

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PERIOD BEGINNING ON THE DATE OF SUCH CHANGE IN CONTROL THROUGH THE THIRD
ANNIVERSARY DATE OF THE CHANGE IN CONTROL. THIS PLAN WILL THEREAFTER
AUTOMATICALLY TERMINATE.

 

SECTION 2.                                DEFINITIONS

 

2.1                                 DEFINITIONS.  THE FOLLOWING CAPITALIZED
TERMS USED IN THIS AGREEMENT WILL HAVE THE MEANINGS SET FORTH BELOW:

 

(A)                                  “ANNUAL BASE SALARY” MEANS, AT ANY TIME,
THE THEN REGULAR ANNUAL RATE OF CASH COMPENSATION THAT A PARTICIPANT IS
RECEIVING AS ANNUAL SALARY, EXCLUDING ALL OTHER KINDS OF COMPENSATION.

 

(B)                                 “ANNUAL INCENTIVE PLAN” MEANS ANY INCENTIVE
COMPENSATION PLAN OF THE COMPANY WITH A PERFORMANCE PERIOD OF ONE YEAR OR LESS
(OTHER THAN AN EQUITY INCENTIVE PLAN) IN WHICH A PARTICIPANT PARTICIPATES ON THE
DATE OF ANY QUALIFYING TERMINATION OF SUCH PARTICIPANT, UNLESS THE COMMITTEE
OTHERWISE DETERMINES THAT SUCH PLAN IS A LONG-TERM CASH INCENTIVE PLAN.

 

(C)                                  “BENEFICIAL OWNER” OR “BENEFICIAL
OWNERSHIP” WILL HAVE THE MEANING GIVEN TO SUCH TERM IN RULE 13D-3 UNDER THE
EXCHANGE ACT.

 

(D)                                 “BOARD” OR “BOARD OF DIRECTORS” MEANS THE
BOARD OF DIRECTORS OF THE COMPANY.

 

(E)                                  “CAUSE” MEANS THE OCCURRENCE OF ANY OF THE
FOLLOWING:

 

(I)                                     THE PARTICIPANT WILLFULLY AND
CONTINUALLY FAILS TO SUBSTANTIALLY PERFORM HIS OR HER DUTIES OF EMPLOYMENT
(OTHER THAN BECAUSE OF A MENTAL OR PHYSICAL IMPAIRMENT) FOR A PERIOD OF AT LEAST
30 DAYS AFTER BEING GIVEN NOTICE OF SUCH FAILURE;

 

(II)                                  THE PARTICIPANT (A) ENGAGES IN ANY ACT OF
DISHONESTY, WRONGDOING OR MORAL TURPITUDE (WHETHER OR NOT A FELONY) OR
(B) VIOLATES THE COMPANY’S CODE OF CONDUCT OR A COMPANY POLICY, WHICH VIOLATION
HAS AN ADVERSE EFFECT UPON THE COMPANY; OR

 

(III)                               THE PARTICIPANT BREACHES HIS OR HER DUTY OF
LOYALTY OR COMMITS AN UNAUTHORIZED DISCLOSURE OF PROPRIETARY OR CONFIDENTIAL
INFORMATION OF THE COMPANY.

 

(F)                                    “CHANGE IN CONTROL” MEANS THE OCCURRENCE
OF ANY OF THE FOLLOWING:

 

(I)                                     THE ACQUISITION BY ANY PERSON OF
BENEFICIAL OWNERSHIP OF 40% OR MORE OF THE OUTSTANDING SHARES OF THE COMPANY’S
VOTING SECURITIES;

 

(II)                                  THE CONSUMMATION OF A REORGANIZATION,
MERGER OR CONSOLIDATION OF THE COMPANY OR SALE OR OTHER DISPOSITION OF ALL OR
SUBSTANTIALLY ALL OF THE ASSETS OF THE COMPANY (A “CORPORATE TRANSACTION”),
UNLESS SUCH CORPORATE TRANSACTION IS A

 

2

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TRANSACTION PURSUANT TO WHICH ALL OR SUBSTANTIALLY ALL OF THE PERSONS WHO ARE
THE BENEFICIAL OWNERS OF THE COMPANY IMMEDIATELY PRIOR TO THE CORPORATE
TRANSACTION WILL BENEFICIALLY OWN, DIRECTLY OR INDIRECTLY, 60% OR MORE OF THE
OUTSTANDING SHARES OF VOTING SECURITIES OF THE RESULTING OR COMBINED ENTITY;

 

(III)                               INDIVIDUALS WHO, AS OF THE EFFECTIVE DATE,
CONSTITUTE THE BOARD (THE “INCUMBENT BOARD”) CEASE FOR ANY REASON TO CONSTITUTE
AT LEAST A MAJORITY OF THE BOARD; PROVIDED, HOWEVER, THAT (A) ANY INDIVIDUAL WHO
BECOMES A MEMBER OF THE BOARD SUBSEQUENT TO THE EFFECTIVE DATE, 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
WILL BE DEEMED A MEMBER OF THE INCUMBENT BOARD AND (B) ANY INDIVIDUAL WHO IS
INITIALLY ELECTED AS A MEMBER OF THE BOARD AS A RESULT OF ANY ACTUAL OR
THREATENED SOLICITATION OF PROXIES OR CONSENTS BY OR ON BEHALF OF ANY PERSON
OTHER THAN THE BOARD WILL NOT BE DEEMED A MEMBER OF THE INCUMBENT BOARD;

 

(IV)                              APPROVAL BY THE STOCKHOLDERS OF THE COMPANY OF
A COMPLETE LIQUIDATION OR DISSOLUTION OF THE COMPANY; OR

 

(V)                                 ANY OTHER CIRCUMSTANCES (WHETHER OR NOT
FOLLOWING A CHANGE EVENT) WHICH THE BOARD DETERMINES TO BE A CHANGE IN CONTROL
FOR PURPOSES OF THIS PLAN AFTER GIVING DUE CONSIDERATION TO THE NATURE OF THE
CIRCUMSTANCES THEN PRESENTED AND THE PURPOSES OF THIS PLAN. ANY SUCH
DETERMINATION MADE BY THE BOARD WILL BE IRREVOCABLE EXCEPT BY VOTE OF A MAJORITY
OF THE MEMBERS OF THE BOARD WHO VOTED IN FAVOR OF MAKING SUCH DETERMINATION.

 

For purposes of this Section 2.1(f), a “Change in Control” will not result from
any transaction precipitated by the Company’s insolvency, appointment of a
conservator or determination by a regulatory agency that the Company is
insolvent.

 

(G)                                 “CHANGE EVENT” MEANS EITHER OF THE
FOLLOWING:

 

(I)                                     THE ACQUISITION BY ANY PERSON (OTHER
THAN THE COMPANY OR A SUBSIDIARY OR AN EMPLOYEE BENEFIT PLAN (INCLUDING ITS
TRUSTEE) OF THE COMPANY) OF BENEFICIAL OWNERSHIP, DIRECTLY OR INDIRECTLY, OF
SHARES OF VOTING SECURITIES OF THE COMPANY DIRECTLY OR INDIRECTLY REPRESENTING
15% OR MORE OF THE TOTAL NUMBER OF THE THEN OUTSTANDING SHARES OF THE COMPANY’S
VOTING SECURITIES (EXCLUDING THE SALE OR ISSUANCE OF ANY VOTING SECURITIES
DIRECTLY BY THE COMPANY, OR ANY TRANSACTION IN WHICH THE ACQUISITION OF SUCH
VOTING SECURITIES IS MADE BY SUCH PERSON FROM FIVE OR FEWER STOCKHOLDERS IN A
TRANSACTION OR TRANSACTIONS APPROVED IN ADVANCE BY THE BOARD); OR

 

(II)                                  THE PUBLIC ANNOUNCEMENT BY ANY PERSON OF
AN INTENTION TO ACQUIRE THE COMPANY THROUGH A TENDER OFFER, EXCHANGE OFFER OR
OTHER UNSOLICITED PROPOSAL.

 

(H)                                 “CODE” MEANS THE U.S. INTERNAL REVENUE CODE
OF 1986, AS AMENDED FROM TIME TO TIME.

 

3

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(I)                                     “COMMITTEE” MEANS THE PERSONNEL AND
COMPENSATION COMMITTEE OF THE BOARD, OR, IF NO PERSONNEL AND COMPENSATION
COMMITTEE EXISTS, THEN A COMMITTEE OF INDEPENDENT BOARD MEMBERS APPOINTED BY THE
BOARD TO ADMINISTER THIS PLAN.

 

(J)                                     “COMMON STOCK” MEANS THE COMMON STOCK,
PAR VALUE $.01 PER SHARE, OF THE COMPANY.

 

(K)                                  “DISABILITY” OR “DISABLED” WILL HAVE THE
MEANING GIVEN TO SUCH TERM IN THE COMPANY’S GOVERNING LONG-TERM DISABILITY PLAN
OR, IF NO SUCH PLAN EXISTS, SUCH TERM WILL MEAN TOTAL AND PERMANENT DISABILITY
AS DETERMINED UNDER THE RULES OF THE SOCIAL SECURITY ADMINISTRATION.

 

(L)                                     “ERISA” MEANS THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED FROM TIME TO TIME.

 

(M)                               “EQUITY INCENTIVE PLAN” MEANS ANY INCENTIVE
COMPENSATION PLAN OF THE COMPANY PROVIDING FOR THE GRANT OF STOCK AWARDS IN
WHICH A PARTICIPANT PARTICIPATES ON THE DATE OF ANY QUALIFYING TERMINATION OF
SUCH PARTICIPANT.

 

(N)                                 “EXCHANGE ACT” MEANS THE SECURITIES EXCHANGE
ACT OF 1934, AS AMENDED FROM TIME TO TIME.

 

(O)                                 “GROUP HEALTH PLAN” MEANS ANY GROUP HEALTH
PLAN GENERALLY AVAILABLE TO ALL EMPLOYEES OF THE COMPANY IN WHICH A PARTICIPANT
PARTICIPATES ON THE DATE OF ANY QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

(P)                                 “GOOD REASON” MEANS, WITHOUT A PARTICIPANT’S
EXPRESS WRITTEN CONSENT, THE OCCURRENCE AFTER A CHANGE EVENT OR A CHANGE IN
CONTROL, AS THE CASE MAY BE, OF ANY ONE OR MORE OF THE FOLLOWING:

 

(I)                                     A MATERIAL REDUCTION OF SUCH
PARTICIPANT’S AUTHORITIES, DUTIES OR RESPONSIBILITIES AS AN EXECUTIVE AND/OR
OFFICER OF THE COMPANY FROM THOSE IN EFFECT IMMEDIATELY PRIOR TO SUCH CHANGE
EVENT OR CHANGE IN CONTROL, OTHER THAN (A) AN INSUBSTANTIAL REDUCTION OR (B) A
SUBSTANTIAL REDUCTION THAT IS REMEDIED BY THE COMPANY WITHIN 30 DAYS AFTER
RECEIPT OF NOTICE THEREOF GIVEN BY THE PARTICIPANT WITHIN 90 DAYS AFTER SUCH
CIRCUMSTANCES FIRST ARISE;

 

(II)                                  THE COMPANY’S REQUIRING THE PARTICIPANT TO
BE BASED AT A LOCATION IN EXCESS OF 50 MILES FROM THE PARTICIPANT’S PRINCIPAL
JOB LOCATION IMMEDIATELY PRIOR TO SUCH CHANGE EVENT OR CHANGE IN CONTROL, UNLESS
SUCH REQUIREMENT IS WITHDRAWN BY THE COMPANY WITHIN 30 DAYS AFTER NOTICE THEREOF
GIVEN BY THE PARTICIPANT WITHIN 90 DAYS AFTER SUCH CIRCUMSTANCES FIRST ARISE;

 

(III)                               A MATERIAL REDUCTION BY THE COMPANY OF THE
PARTICIPANT’S ANNUAL BASE SALARY IN EFFECT IMMEDIATELY PRIOR TO SUCH CHANGE
EVENT OR CHANGE IN CONTROL, OR AS SUCH ANNUAL BASE SALARY HAS BEEN INCREASED
THEREAFTER, UNLESS SUCH REDUCTION IS REMEDIED BY THE COMPANY WITHIN 30 DAYS
AFTER NOTICE THEREOF GIVEN BY THE PARTICIPANT WITHIN 90 DAYS AFTER SUCH
CIRCUMSTANCES FIRST ARISE;

 

4

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(IV)                              THE FAILURE OF THE COMPANY TO CONTINUE IN
EFFECT, OR THE FAILURE TO CONTINUE THE PARTICIPANT’S PARTICIPATION ON
SUBSTANTIALLY THE SAME BASIS IN, ANY ANNUAL INCENTIVE PLAN, LONG-TERM CASH
INCENTIVE PLAN OR EQUITY COMPENSATION PLAN IN WHICH THE PARTICIPANT PARTICIPATES
IMMEDIATELY PRIOR TO SUCH CHANGE EVENT OR CHANGE IN CONTROL, WHERE THE RESULT IS
A MATERIAL REDUCTION IN THE PARTICIPANT’S TOTAL COMPENSATION, UNLESS SUCH
FAILURE IS REMEDIED BY THE COMPANY WITHIN 30 DAYS AFTER NOTICE THEREOF GIVEN BY
THE PARTICIPANT WITHIN 90 DAYS AFTER SUCH CIRCUMSTANCES FIRST ARISE ; AND

 

(V)                                 IF SUCH CHANGE IN CONTROL RESULTS IN A
SUCCESSOR TO THE COMPANY, THE FAILURE OF THE COMPANY TO OBTAIN A SATISFACTORY
AGREEMENT FROM SUCH SUCCESSOR TO ASSUME AND AGREE TO PERFORM THE COMPANY’S
OBLIGATIONS UNDER THIS PLAN, AS CONTEMPLATED BY SECTION 9.1, UNLESS SUCH FAILURE
IS REMEDIED WITHIN 30 DAYS AFTER NOTICE THEREOF GIVEN BY THE PARTICIPANT WITHIN
90 DAYS AFTER SUCH CIRCUMSTANCES FIRST ARISE.

 

Unless the Participant becomes Disabled, the Participant’s right to terminate
employment for Good Reason will not be affected by the Participant’s incapacity
due to physical or mental illness. The Participant’s continued employment will
not constitute consent to, or a waiver of rights with respect to, any action or
circumstance constituting Good Reason.

 

(Q)                                 “LONG-TERM CASH INCENTIVE PLAN” MEANS
(I) ANY CASH INCENTIVE COMPENSATION PLAN OF THE COMPANY WITH A PERFORMANCE
PERIOD OF MORE THAN ONE YEAR (OTHER THAN AN EQUITY INCENTIVE PLAN) OR (II) OR
ANY OTHER CASH INCENTIVE COMPENSATION PLAN THE COMMITTEE DETERMINES IS A
LONG-TERM CASH INCENTIVE PLAN (OTHER THAN AN EQUITY INCENTIVE PLAN), IN EACH
CASE IN WHICH A PARTICIPANT PARTICIPATES ON THE DATE OF ANY QUALIFYING
TERMINATION OF SUCH PARTICIPANT.

 

(R)                                    “NOTICE OF TERMINATION” MEANS A WRITTEN
NOTICE INDICATING THE SPECIFIC PROVISION IN THIS PLAN RELIED UPON FOR THE
TERMINATION OF EMPLOYMENT OF ANY PARTICIPANT. SUCH NOTICE WILL SET FORTH IN
REASONABLE DETAIL THE FACTS AND CIRCUMSTANCES CLAIMED TO PROVIDE THE BASIS FOR
SUCH TERMINATION PURSUANT TO SUCH PROVISION.

 

(S)                                  “PARTICIPANT” MEANS ANY OF THE TIER 1
PARTICIPANTS OR TIER 2 PARTICIPANTS.

 

(T)                                    “PERFORMANCE VESTING STOCK AWARD” MEANS
ANY STOCK AWARD THE VESTING AND PAYMENT OF WHICH IS BASED ON ACHIEVEMENT OF
PERFORMANCE GOALS RATHER THAN SOLELY ON THE CONTINUED EMPLOYMENT OF A
PARTICIPANT.

 

(U)                                 “PERQUISITES” MEANS ANY AUTOMOBILE
ALLOWANCE, FINANCIAL PLANNING SERVICES, EMPLOYMENT OUTPLACEMENT SERVICES OR
OTHER PERQUISITES PROVIDED TO A PARTICIPANT UNDER ANY BENEFIT PLAN OR PROGRAM OF
THE COMPANY THAT PROVIDES SPECIAL BENEFITS TO A SELECT GROUP OF MANAGEMENT OR
HIGHLY COMPENSATED EMPLOYEES IN WHICH SUCH PARTICIPANT PARTICIPATES ON THE DATE
OF ANY QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

(V)                                 “PERSON” WILL HAVE THE MEANING GIVEN TO SUCH
TERM IN SECTION 3(A)(9) OF THE EXCHANGE ACT AND USED IN SECTIONS 13(D) AND 14(D)
THEREOF (INCLUDING A “GROUP” AS DEFINED IN SECTION 13(D)).

 

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(W)                               “QUALIFIED 401(K) PLAN” MEANS ANY RETIREMENT
PLAN OF THE COMPANY WITH A VOLUNTARY ELECTIVE DEFERRAL ARRANGEMENT INTENDED TO
BE QUALIFIED UNDER SECTIONS 401(A) AND 401(K) OF THE CODE IN WHICH A PARTICIPANT
PARTICIPATES ON THE DATE OF ANY QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

(X)                                   “QUALIFYING TERMINATION” MEANS A
POST-CHANGE IN CONTROL QUALIFYING TERMINATION (AS DEFINED IN SECTION 3.1(A)) OR
A PRE-CHANGE IN CONTROL QUALIFYING TERMINATION (AS DEFINED IN SECTION 3.1(B)),
AS THE CASE MAY BE; PROVIDED, HOWEVER THAT A QUALIFYING TERMINATION WILL NOT
OCCUR UNLESS THE PARTICIPANT’S TERMINATION OF EMPLOYMENT QUALIFIES AS A
“SEPARATION FROM SERVICE” (WITHIN THE MEANING OF SECTION 409A OF THE CODE).

 

(Y)                                 “RETIREMENT PLAN” MEANS ANY “EMPLOYEE
PENSION BENEFIT PLAN” (WITHIN THE MEANING OF SECTION 3(2) OF ERISA) OF THE
COMPANY, INCLUDING, WITHOUT LIMITATION, ANY QUALIFIED 401(K) PLAN AND ANY SERP.

 

(Z)                                   “SERP” MEANS (I) THE COMPANY’S
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN, OR (II) ANY OTHER NON-QUALIFIED
SUPPLEMENTAL RETIREMENT PLAN OR AGREEMENT PURSUANT TO WHICH ANY PARTICIPANT IS
ENTITLED TO RECEIVE SUPPLEMENTAL RETIREMENT BENEFITS ON THE DATE OF ANY
QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

(AA)                            “SEVERANCE BENEFITS” MEAN THE SEVERANCE BENEFITS
PROVIDED FOR IN SECTION 3.2, 3.3 AND 3.4.

 

(BB)                          “STOCK AWARD” MEANS ANY EQUITY-BASED INCENTIVE
AWARD (INCLUDING ANY AWARD, WITHOUT LIMITATION, OF STOCK OPTIONS, STOCK
APPRECIATION RIGHTS, RESTRICTED STOCK OR RESTRICTED STOCK UNITS, OR ANY
PERFORMANCE VESTING STOCK AWARDS).

 

(CC)                            “TARGET LEVEL” MEANS THE “TARGET” PERFORMANCE
LEVEL (OR OTHER REASONABLY EXPECTED MEDIAN PERFORMANCE GOAL) ESTABLISHED FOR
PURPOSES OF ANY ANNUAL INCENTIVE PLAN, LONG-TERM CASH INCENTIVE PLAN OR
PERFORMANCE VESTING STOCK AWARD.

 

(DD)                          “TAX” OR “TAXES” MEANS ALL TAXES, CHARGES, FEES,
LEVIES OR OTHER ASSESSMENTS AND IMPOSITIONS OF ANY KIND, PAYABLE TO ANY
GOVERNMENTAL ENTITY, INCLUDING, WITHOUT LIMITATION, ALL NET INCOME, PROFITS,
GROSS INCOME, ALTERNATIVE MINIMUM, PAYROLL, EMPLOYMENT, SOCIAL SECURITY,
MEDICARE, UNEMPLOYMENT, WITHHOLDING, DISABILITY, WORKERS’ COMPENSATION, EXCISE,
OR OTHER TAXES OR FEES, ASSESSMENTS OR CHARGES OF ANY KIND WHATSOEVER,
INCLUDING, WITHOUT LIMITATION, ALL INTEREST AND PENALTIES THEREON, AND ADDITIONS
TO TAX OR ADDITIONAL AMOUNTS IMPOSED BY ANY TAXING AUTHORITY.

 

(EE)                            “TIER 1 PARTICIPANT” MEANS EACH OF THE CHIEF
EXECUTIVE OFFICER, CHIEF FINANCIAL OFFICER, CHIEF OPERATING OFFICER AND GENERAL
COUNSEL OF THE COMPANY.

 

(FF)                                “TIER 2 PARTICIPANT” MEANS (I) ANY EXECUTIVE
OFFICER OF THE COMPANY (OTHER THAN A TIER 1 PARTICIPANT) REQUIRED TO FILE
REPORTS OF BENEFICIAL OWNERSHIP WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO SECTION 16(A) OF THE EXCHANGE ACT AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER AND (II) ANY EMPLOYEE SELECTED BY THE COMMITTEE AS A
COVERED EMPLOYEE ELIGIBLE UNDER THIS PLAN (EMPLOYEES SELECTED BY THE

 

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COMMITTEE WILL BE REFERRED TO AS “SELECTED TIER 2 PARTICIPANTS”). THE COMMITTEE
WILL SELECT SELECTED TIER 2 PARTICIPANTS ANNUALLY AT THE MEETING IN WHICH IT
SETS EXECUTIVE COMPENSATION FOR THE NEXT FISCAL YEAR. SELECTED TIER 2
PARTICIPANTS WILL REMAIN ELIGIBLE AS A PARTICIPANT UNDER THIS PLAN FOR THE
FISCAL YEAR FOR WHICH THE COMMITTEE APPROVED ELIGIBILITY. DURING THE FISCAL
YEAR, THE COMMITTEE MAY CHANGE THE STATUS OF A SELECTED TIER 2 PARTICIPANT IF HE
OR SHE HAS A CHANGE IN EMPLOYMENT STATUS (EXAMPLES:  REMOVAL FROM ELIGIBILITY
BECAUSE OF A DEMOTION OR ADDED AS ELIGIBLE BECAUSE OF A PROMOTION).
NOTWITHSTANDING THE FOREGOING, A SELECTED TIER 2 PARTICIPANT MAY NOT LOSE
COVERED EMPLOYEE STATUS AS A SELECTED TIER 2 PARTICIPANT BY THE COMMITTEE IF HE
OR SHE WAS A PARTICIPANT AND WAS ELIGIBLE FOR BENEFITS UNDER SECTION 3.1, RIGHTS
TO UNPAID COMPENSATION AND SEVERANCE BENEFITS, FOR A CHANGE IN CONTROL
OCCURRENCE.

 

(GG)                          “UNPAID COMPENSATION” MEANS ANY OF THE FOLLOWING:

 

(I)                                     ANY UNPAID ANNUAL BASE SALARY, ACCRUED
VACATION PAY AND UNREIMBURSED BUSINESS EXPENSES OWED TO ANY PARTICIPANT THROUGH
THE DATE OF THE QUALIFYING TERMINATION OF SUCH PARTICIPANT;

 

(II)                                  ANY AMOUNT PAYABLE TO SUCH PARTICIPANT AS
OF THE DATE OF SUCH PARTICIPANT’S QUALIFYING TERMINATION UNDER ANY ANNUAL
INCENTIVE PLAN IN EFFECT FOR THE MOST RECENTLY COMPLETED FISCAL YEAR, TO THE
EXTENT NOT PREVIOUSLY PAID; AND

 

(III)                               ANY AMOUNT PAYABLE TO SUCH PARTICIPANT AS OF
THE DATE OF SUCH PARTICIPANT’S QUALIFYING TERMINATION UNDER ANY LONG-TERM CASH
INCENTIVE PLAN IN EFFECT FOR ANY COMPLETED PERFORMANCE PERIOD, TO THE EXTENT NOT
PREVIOUSLY PAID.

 

(HH)                          “VOTING SECURITIES” MEANS ANY SHARES OF CAPITAL
STOCK OF ANY ENTITY THAT ARE GENERALLY ENTITLED TO VOTE IN ELECTIONS FOR MEMBERS
OF THE BOARD OF DIRECTORS.

 

SECTION 3.                                UNPAID COMPENSATION AND SEVERANCE
BENEFITS

 

3.1                                 RIGHT TO UNPAID COMPENSATION AND SEVERANCE
BENEFITS.

 

(A)                                  SUBJECT TO THE TERMS AND CONDITIONS OF THIS
PLAN, A PARTICIPANT WILL BE ENTITLED TO RECEIVE FROM THE COMPANY ANY UNPAID
COMPENSATION AND THE SEVERANCE BENEFITS DESCRIBED IN SECTIONS 3.2, 3.3 AND 3.4
(AS APPLICABLE) IF (I) DURING THE TERM OF THIS PLAN, A CHANGE IN CONTROL OCCURS
AND (II) WITHIN 36 MONTHS THEREAFTER, THE PARTICIPANT’S EMPLOYMENT WITH THE
COMPANY IS TERMINATED BY THE COMPANY WITHOUT CAUSE OR VOLUNTARILY BY THE
PARTICIPANT FOR GOOD REASON, IN THE LATTER CASE WITHIN TWO YEARS AFTER THE
CIRCUMSTANCES COMPRISING GOOD REASON FIRST ARISE. THE TERMINATION OF A
PARTICIPANT’S EMPLOYMENT THAT ENTITLES THE PARTICIPANT TO SEVERANCE BENEFITS
PURSUANT TO THIS SECTION 3.1(A) IS REFERRED TO IN THIS PLAN AS A “POST-CHANGE IN
CONTROL QUALIFYING TERMINATION.”  A “POST-CHANGE IN CONTROL QUALIFYING
TERMINATION” WILL NOT INCLUDE A TERMINATION OF A PARTICIPANT’S EMPLOYMENT BY
REASON OF DEATH OR DISABILITY, THE COMPANY’S TERMINATION OF A PARTICIPANT’S
EMPLOYMENT FOR CAUSE OR A PARTICIPANT’S VOLUNTARY TERMINATION WITHOUT GOOD
REASON.

 

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(B)                                 SUBJECT TO THE TERMS AND CONDITIONS OF THIS
PLAN, A PARTICIPANT WILL ALSO BE ENTITLED TO RECEIVE FROM THE COMPANY ANY UNPAID
COMPENSATION AND THE SEVERANCE BENEFITS DESCRIBED IN SECTIONS 3.2, 3.3 AND 3.4
(AS APPLICABLE) IF (I) DURING THE TERM OF THIS PLAN, A CHANGE EVENT AND A CHANGE
IN CONTROL OCCUR AND (II) WITHIN 12 MONTHS AFTER SUCH CHANGE EVENT AND NO MORE
THAN 12 MONTHS PRIOR TO SUCH CHANGE IN CONTROL, SUCH PARTICIPANT’S EMPLOYMENT
WITH THE COMPANY IS TERMINATED BY THE COMPANY WITHOUT CAUSE OR VOLUNTARILY BY
THE PARTICIPANT FOR GOOD REASON, IN THE LATTER CASE WITHIN TWO YEARS AFTER THE
CIRCUMSTANCES COMPRISING GOOD REASON FIRST ARISE; PROVIDED, HOWEVER, THAT THE
PARTICIPANT WILL ONLY BE ENTITLED TO RECEIVE SUCH SEVERANCE BENEFITS IF THE
PARTICIPANT CAN DEMONSTRATE THAT SUCH TERMINATION BY THE COMPANY OR EVENT
CONSTITUTING GOOD REASON (A) OCCURRED AT THE SPECIFIC REQUEST OF A THIRD PARTY
WITH WHICH THE COMPANY HAD ENTERED INTO NEGOTIATIONS OR AN AGREEMENT REGARDING A
SUBSEQUENT CHANGE IN CONTROL OR (B) OTHERWISE OCCURRED IN CONNECTION WITH (OR IN
ANTICIPATION OF) SUCH CHANGE IN CONTROL. THE TERMINATION OF A PARTICIPANT’S
EMPLOYMENT THAT ENTITLES THE PARTICIPANT TO SEVERANCE BENEFITS PURSUANT TO THIS
SECTION 3.1(B) IS REFERRED TO IN THIS PLAN AS A “PRE-CHANGE IN CONTROL
QUALIFYING TERMINATION.”  A “PRE-CHANGE IN CONTROL QUALIFYING TERMINATION” WILL
NOT INCLUDE A TERMINATION OF A PARTICIPANT’S EMPLOYMENT BY REASON OF DEATH OR
DISABILITY, THE COMPANY’S TERMINATION OF A PARTICIPANT’S EMPLOYMENT FOR CAUSE OR
A PARTICIPANT’S VOLUNTARY TERMINATION WITHOUT GOOD REASON.

 

(C)                                  ANY UNPAID COMPENSATION WILL BE PAID IN
CASH TO A PARTICIPANT IN A SINGLE LUMP SUM WITHIN 30 DAYS AFTER THE DATE OF THE
QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

3.2                                 SEVERANCE BENEFITS FOR TIER 1 PARTICIPANTS
AND TIER 2 PARTICIPANTS.  IN THE EVENT THE COMPANY IS OBLIGATED TO PROVIDE
SEVERANCE BENEFITS TO ANY PARTICIPANT PURSUANT TO SECTION 3.1, SUCH PARTICIPANT
WILL RECEIVE THE FOLLOWING WITH PAYMENT AS PROVIDED IN THIS SECTION 3 UNLESS THE
PARTICIPANT HAS VALIDLY AND EFFECTIVELY ELECTED DEFERRAL OF ANY SUCH PAYMENT OR
AWARD UNDER ANOTHER PLAN (IN WHICH CASE THE PAYMENT OR AWARD WOULD BE MADE UNDER
THE TERMS OF THE OTHER PLAN):

 

(A)                                  THE CASH AMOUNT SUCH PARTICIPANT WOULD
RECEIVE UNDER THE ANNUAL INCENTIVE PLAN IN EFFECT FOR THE FISCAL YEAR IN WHICH
SUCH PARTICIPANT’S QUALIFYING TERMINATION OCCURS. IF SUCH QUALIFYING TERMINATION
OCCURS WITHIN THE FIRST THREE QUARTERS OF ANY FISCAL YEAR, SUCH CASH AMOUNT WILL
BE DETERMINED BASED ON THE ASSUMPTION THAT THE TARGET LEVEL OF PERFORMANCE UNDER
SUCH ANNUAL INCENTIVE PLAN HAD BEEN ACHIEVED. IF THE QUALIFYING TERMINATION
OCCURS IN THE FOURTH QUARTER OF ANY FISCAL YEAR, SUCH CASH AMOUNT WILL BE
DETERMINED BASED ON PROJECTED ACTUAL PERFORMANCE (UNLESS TARGET LEVEL
PERFORMANCE WOULD RESULT IN A LARGER CASH PAYMENT, IN WHICH EVENT THE AMOUNT OF
THE CASH PAYMENT WILL BE DETERMINED BASED ON THE ASSUMPTION THAT TARGET LEVEL
PERFORMANCE HAD BEEN ACHIEVED). IN EACH CASE, THE CASH AMOUNT WILL BE ADJUSTED
ON A PRO RATA BASIS TO REFLECT THE NUMBER OF DAYS THE PARTICIPANT WAS ACTUALLY
EMPLOYED DURING SUCH FISCAL YEAR.

 

(B)                                 THE CASH AMOUNT SUCH PARTICIPANT WOULD
RECEIVE UNDER ANY LONG-TERM CASH INCENTIVE PLAN IN EFFECT AT THE TIME SUCH
PARTICIPANT’S QUALIFYING TERMINATION OCCURS, ASSUMING THE TARGET LEVEL OF
PERFORMANCE UNDER SUCH LONG-TERM CASH INCENTIVE PLAN HAD BEEN ACHIEVED.

 

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(C)                                  ANY STOCK AWARDS OF THE PARTICIPANT (OTHER
THAN PERFORMANCE VESTING STOCK AWARDS) WILL BECOME IMMEDIATELY VESTED AND
PAYABLE IN FULL IN THE FORM OF STOCK ON THE DATE OF A QUALIFYING TERMINATION OF
THE PARTICIPANT AND WILL BE PAID, DISTRIBUTED OR TRANSFERRED TO THE PARTICIPANT
IN ACCORDANCE WITH THEIR TERMS.

 

(D)                                 ANY PERFORMANCE VESTING STOCK AWARDS OF THE
PARTICIPANT WILL BECOME IMMEDIATELY VESTED AND PAYABLE IN THE FORM OF STOCK ON
THE DATE OF A QUALIFYING TERMINATION OF SUCH PARTICIPANT, ASSUMING THE TARGET
LEVEL OF PERFORMANCE UNDER SUCH PERFORMANCE VESTING STOCK AWARD HAD BEEN
ACHIEVED AND WILL BE PAID, DISTRIBUTED OR TRANSFERRED TO THE PARTICIPANT IN
ACCORDANCE WITH THEIR TERMS.

 

(E)                                  A CASH AMOUNT, DETERMINED IN THE SOLE
DISCRETION OF THE COMMITTEE, WITH A VALUE EQUAL TO ANY PERQUISITES THAT WOULD
HAVE BEEN PROVIDED TO THE PARTICIPANT FOR A PERIOD OF ONE YEAR FOLLOWING THE
QUALIFYING TERMINATION OF SUCH PARTICIPANT.

 

3.3                                 SEVERANCE BENEFITS FOR TIER 1 PARTICIPANTS.
 IN THE EVENT THE COMPANY IS OBLIGATED TO PROVIDE SEVERANCE BENEFITS TO ANY
TIER 1 PARTICIPANT PURSUANT TO SECTION 3.1, SUCH TIER 1 PARTICIPANT WILL RECEIVE
(IN ADDITION TO THE SEVERANCE BENEFITS DESCRIBED IN SECTION 3.2) THE FOLLOWING:

 

(A)                                  A CASH AMOUNT EQUAL TO THE SUM OF: 
(I) THREE TIMES THE TIER 1 PARTICIPANT’S ANNUAL BASE SALARY IN EFFECT ON THE
DATE OF HIS OR HER QUALIFYING TERMINATION, PLUS (II) THREE TIMES THE TIER 1
PARTICIPANT’S THEN CURRENT BONUS OPPORTUNITY ESTABLISHED UNDER ANY ANNUAL
INCENTIVE PLAN, ASSUMING THE TARGET LEVEL OF PERFORMANCE UNDER SUCH ANNUAL
INCENTIVE PLAN HAD BEEN ACHIEVED.

 

(B)                                 A CASH AMOUNT EQUAL TO THREE TIMES THE
MAXIMUM MATCH (DETERMINED ON AN ANNUAL BASIS) THE TIER 1 PARTICIPANT WOULD HAVE
RECEIVED UNDER ANY QUALIFIED 401(K) PLAN FOR THE CALENDAR YEAR IN WHICH SUCH
TIER 1 PARTICIPANT’S QUALIFYING TERMINATION OCCURS, ASSUMING SUCH TIER 1
PARTICIPANT HAD (I) EARNED “RECOGNIZED COMPENSATION” DURING SUCH CALENDAR YEAR
EQUAL TO OR GREATER THAN THE MAXIMUM DOLLAR AMOUNT PERMITTED UNDER THE CODE AND
(II) DEFERRED INTO THE QUALIFIED 401(K) PLAN SUCH MAXIMUM DOLLAR AMOUNT FOR THE
CALENDAR YEAR.

 

(C)                                  A CASH AMOUNT, DETERMINED IN THE SOLE
DISCRETION OF THE COMMITTEE, WITH A VALUE EQUAL TO THE BENEFITS THAT WOULD HAVE
BEEN PROVIDED TO THE PARTICIPANT FOR A PERIOD OF THREE YEARS AFTER THE DATE OF
SUCH PARTICIPANT’S QUALIFYING TERMINATION UNDER THE GROUP HEALTH PLAN.

 

(D)                                 AN ADDITIONAL SUPPLEMENTAL RETIREMENT
BENEFIT EQUAL TO THE INCREASE TO THE TIER 1 PARTICIPANT’S BENEFIT UNDER ANY SERP
THAT WOULD HAVE OCCURRED IF THE AMOUNT OF SUCH TIER 1 PARTICIPANT’S BENEFIT
PAYABLE UNDER THE SERP WAS DETERMINED BASED ON THE ASSUMPTION THAT THE TIER 1
PARTICIPANT HAD BEEN CONTINUOUSLY EMPLOYED BY THE COMPANY FOR THE THREE-YEAR
PERIOD FOLLOWING THE DATE OF SUCH TIER 1 PARTICIPANT’S QUALIFYING TERMINATION
(WITH RESPECT TO BOTH THE TIER 1 PARTICIPANT’S AGE AND YEARS OF SERVICE);
PROVIDED, HOWEVER, THAT NEITHER THE TIME NOR THE FORM OF PAYMENT OF SUCH TIER 1
PARTICIPANT’S BENEFIT UNDER THE SERP WILL BE AFFECTED BY SUCH ADDITIONAL AGE AND
SERVICE

 

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CREDIT, AND SUCH SUPPLEMENTAL RETIREMENT BENEFIT WILL BE PAID AT THE TIME AND IN
THE FORM THE BENEFIT UNDER THE SERP IS PAID. IN DETERMINING THE AMOUNT OF SUCH
ADDITIONAL SUPPLEMENTAL RETIREMENT BENEFIT, A TIER 1 PARTICIPANT’S “RECOGNIZED
COMPENSATION” WILL BE DEEMED TO INCLUDE HIS OR HER ANNUAL BASE SALARY AND ANY
PAYMENTS RECEIVED BY THE TIER 1 PARTICIPANT PURSUANT TO ANY ANNUAL INCENTIVE
PLAN DURING THE YEAR PRECEDING HIS OR HER QUALIFYING TERMINATION.

 

3.4                                 SEVERANCE BENEFITS FOR TIER 2 PARTICIPANTS.
 IN THE EVENT THE COMPANY IS OBLIGATED TO PROVIDE SEVERANCE BENEFITS TO ANY
TIER 2 PARTICIPANT PURSUANT TO SECTION 3.1, SUCH TIER 2 PARTICIPANT WILL RECEIVE
(IN ADDITION TO THE SEVERANCE BENEFITS DESCRIBED IN SECTION 3.2) THE FOLLOWING:

 

(A)                                  A CASH AMOUNT EQUAL TO THE SUM OF:  (I) TWO
TIMES THE TIER 2 PARTICIPANT’S ANNUAL BASE SALARY IN EFFECT ON THE DATE OF HIS
OR HER QUALIFYING TERMINATION, PLUS (II) TWO TIMES THE TIER 2 PARTICIPANT’S THEN
CURRENT BONUS OPPORTUNITY ESTABLISHED UNDER ANY ANNUAL INCENTIVE PLAN, ASSUMING
THE TARGET LEVEL OF PERFORMANCE UNDER SUCH ANNUAL INCENTIVE PLAN HAD BEEN
ACHIEVED.

 

(B)                                 A CASH AMOUNT EQUAL TO TWO TIMES THE MAXIMUM
MATCH (DETERMINED ON AN ANNUAL BASIS) THE TIER 2 PARTICIPANT COULD HAVE RECEIVED
UNDER ANY QUALIFIED 401(K) PLAN FOR THE CALENDAR YEAR IN WHICH SUCH TIER 2
PARTICIPANT’S QUALIFYING TERMINATION OCCURS, ASSUMING SUCH TIER 2 PARTICIPANT
HAD (I) EARNED “RECOGNIZED COMPENSATION” DURING SUCH CALENDAR YEAR EQUAL TO OR
GREATER THAN THE MAXIMUM DOLLAR AMOUNT PERMITTED UNDER THE CODE AND
(II) DEFERRED INTO THE QUALIFIED 401(K) PLAN SUCH MAXIMUM DOLLAR AMOUNT FOR THE
CALENDAR YEAR.

 

(C)                                  A CASH AMOUNT, DETERMINED IN THE SOLE
DISCRETION OF THE COMMITTEE, WITH A VALUE EQUAL TO THE BENEFITS THAT WOULD HAVE
BEEN PROVIDED TO THE PARTICIPANT FOR A PERIOD OF TWO YEARS AFTER THE DATE OF
SUCH PARTICIPANT’S QUALIFYING TERMINATION UNDER THE GROUP HEALTH PLAN.

 

(D)                                 AN ADDITIONAL SUPPLEMENTAL RETIREMENT
BENEFIT EQUAL TO THE INCREASE TO THE TIER 2 PARTICIPANT’S BENEFIT UNDER ANY SERP
THAT WOULD HAVE OCCURRED IF THE AMOUNT OF SUCH TIER 2 PARTICIPANT’S BENEFIT
PAYABLE UNDER THE SERP WAS DETERMINED BASED ON THE ASSUMPTION THAT THE TIER 2
PARTICIPANT HAD BEEN CONTINUOUSLY EMPLOYED BY THE COMPANY FOR THE TWO-YEAR
PERIOD FOLLOWING THE DATE OF SUCH TIER 2 PARTICIPANT’S QUALIFYING TERMINATION
(WITH RESPECT TO BOTH THE TIER 2 PARTICIPANT’S AGE AND YEARS OF SERVICE);
PROVIDED, HOWEVER, THAT NEITHER THE TIME NOR THE FORM OF PAYMENT OF SUCH TIER 2
PARTICIPANT’S BENEFIT UNDER THE SERP WILL BE AFFECTED BY SUCH ADDITIONAL AGE AND
SERVICE CREDIT, AND SUCH SUPPLEMENTAL RETIREMENT BENEFIT WILL BE PAID AT THE
TIME AND IN THE FORM THE BENEFIT UNDER THE SERP IS PAID. IN DETERMINING THE
AMOUNT OF SUCH ADDITIONAL SUPPLEMENTAL RETIREMENT BENEFIT, A TIER 2
PARTICIPANT’S “RECOGNIZED COMPENSATION” WILL BE DEEMED TO INCLUDE HIS OR HER
ANNUAL BASE SALARY AND ANY PAYMENTS RECEIVED BY THE TIER 2 PARTICIPANT PURSUANT
TO ANY ANNUAL INCENTIVE PLAN DURING THE YEAR PRECEDING HIS OR HER QUALIFYING
TERMINATION.

 

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3.5                                 TERMINATION DUE TO DISABILITY OR DEATH.
 FOLLOWING A CHANGE IN CONTROL, IF A PARTICIPANT’S EMPLOYMENT WITH THE COMPANY
IS TERMINATED DUE TO DISABILITY OR DEATH, THE COMPANY WILL PAY ANY UNPAID
COMPENSATION THROUGH THE DATE OF SUCH TERMINATION TO THE PARTICIPANT OR HIS OR
HER DESIGNATED BENEFICIARIES (OR, IF THERE ARE NO SUCH DESIGNATED BENEFICIARIES,
TO THE PARTICIPANT’S ESTATE), RESPECTIVELY. THE PAYMENT OF ANY OTHER AMOUNTS OR
BENEFITS TO THE PARTICIPANT OR HIS OR HER BENEFICIARIES OR ESTATE WILL BE
DETERMINED IN ACCORDANCE WITH ANY ANNUAL INCENTIVE PLAN, LONG-TERM CASH
INCENTIVE PLAN, EQUITY INCENTIVE PLAN, THE COMPANY’S RETIREMENT, DISABILITY,
INSURANCE AND SURVIVORS’ BENEFITS PLANS AND PROGRAMS AND OTHER APPLICABLE PLANS
AND PROGRAMS OF THE COMPANY THEN IN EFFECT.

 

3.6                                 TERMINATION FOR CAUSE OR BY THE PARTICIPANT
WITHOUT GOOD REASON.  FOLLOWING A CHANGE IN CONTROL, IF A PARTICIPANT’S
EMPLOYMENT WITH THE COMPANY IS TERMINATED EITHER BY THE COMPANY FOR CAUSE OR
VOLUNTARILY BY SUCH PARTICIPANT WITHOUT GOOD REASON, THE COMPANY WILL PAY THE
PARTICIPANT (A) ANY UNPAID COMPENSATION THROUGH THE DATE OF SUCH TERMINATION,
PLUS (B) ALL OTHER AMOUNTS TO WHICH THE PARTICIPANT IS ENTITLED UNDER ANY
COMPENSATION PLANS OF THE COMPANY, AT THE TIME SUCH PAYMENTS ARE DUE. THE
COMPANY WILL HAVE NO FURTHER OBLIGATIONS TO SUCH PARTICIPANT UNDER THIS PLAN.

 

3.7                                 NOTICE OF TERMINATION.  ANY TERMINATION OF A
PARTICIPANT’S EMPLOYMENT BY THE COMPANY FOR CAUSE OR BY THE PARTICIPANT FOR GOOD
REASON WILL BE COMMUNICATED BY NOTICE OF TERMINATION TO SUCH PARTICIPANT OR THE
COMMITTEE, AS THE CASE MAY BE.

 

3.8                                 PAYMENT OF SEVERANCE BENEFITS.  THE
SEVERANCE BENEFITS DESCRIBED IN SECTIONS 3.2(A), (B) AND (E), SECTIONS 3.3(A),
(B) AND (C) AND SECTIONS 3.4(A), (B) AND (C) WILL BE PAID IN CASH TO A
PARTICIPANT IN A SINGLE LUMP SUM WITHIN 30 DAYS FOLLOWING THE DATE OF THE
QUALIFYING TERMINATION OF SUCH PARTICIPANT (OR, IF SUCH PARTICIPANT DIES BEFORE
PAYMENT IS MADE, TO THE PARTICIPANT’S DESIGNATED BENEFICIARIES OR ESTATE WITHIN
30 DAYS AFTER THE DATE OF SUCH PARTICIPANT’S DEATH).

 

SECTION 4.                                RELEASE AND RESTRICTIVE COVENANTS

 

4.1                                 RELEASE.  THE SEVERANCE BENEFITS ARE IN
CONSIDERATION OF A PARTICIPANT’S RELEASE OF ALL CLAIMS AGAINST THE COMPANY
PURSUANT TO AN AGREEMENT WITH TERMS SUBSTANTIALLY SIMILAR TO THE TERMS OF THE
SEPARATION AGREEMENT AND GENERAL RELEASE OF CLAIMS SET FORTH AS EXHIBIT A TO
THIS PLAN (THE “RELEASE”). IF A PARTICIPANT DOES NOT EXECUTE THE RELEASE OR IF
HE OR SHE EFFECTIVELY REVOKES IT, THE PARTICIPANT WILL NOT BE ENTITLED TO ANY
SEVERANCE BENEFITS.

 

4.2                                 RESTRICTIVE COVENANTS.  THE COMPANY’S
OBLIGATION TO PROVIDE THE SEVERANCE BENEFITS TO A PARTICIPANT WILL BE
CONDITIONED ON THE PARTICIPANT’S CONTINUING COMPLIANCE WITH THE CONFIDENTIALITY
AND NON-DISPARAGEMENT, NON-COMPETITION AND NON-SOLICITATION COVENANTS SET FORTH
IN THE RELEASE.

 

4.3                                 SERVICES OF PARTICIPANT.  THE COMPANY’S
OBLIGATION TO PROVIDE THE SEVERANCE BENEFITS TO A PARTICIPANT WILL BE
CONDITIONED UPON THE PARTICIPANT’S CONTINUING COMPLIANCE WITH THE COVENANTS TO
PROVIDE SERVICES TO THE COMPANY SET FORTH IN THE RELEASE.

 

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SECTION 5.                                TRUST

 

5.1                                 ESTABLISHMENT OF TRUST.  AT ANY TIME BUT IN
NO EVENT LATER THAN THE DATE OF A CHANGE IN CONTROL, THE COMPANY WILL ESTABLISH
A TRUST FUND (THE “TRUST”) FOR THE BENEFIT OF THE PARTICIPANTS TO SECURE THE
SEVERANCE BENEFITS TO BE PROVIDED UNDER THIS PLAN. THE COMPANY WILL FUND THE
TRUST WITH CASH OR WITH A LETTER OF CREDIT NOT LATER THAN SUCH DATE OF THE
CHANGE IN CONTROL, OR SUCH EARLIER DATE IF AUTHORIZED BY THE COMMITTEE.
NOTWITHSTANDING THE FOREGOING, ANY OBLIGATIONS OWED BY THE COMPANY UNDER THIS
PLAN ARE UNFUNDED AND UNSECURED LIABILITIES OF THE COMPANY. IN THE EVENT OF THE
COMPANY’S INSOLVENCY OR BANKRUPTCY, THE ASSETS OF THE TRUST WILL BE TREATED LIKE
OTHER CORPORATE ASSETS OF THE COMPANY AND WILL BE SUBJECT TO THE CLAIMS OF THE
COMPANY’S CREDITORS. CLAIMS FOR BENEFITS UNDER THIS PLAN WILL BE TREATED LIKE
ANY OTHER CLAIM BY THE COMPANY’S UNSECURED CREDITORS, WITH NO SPECIAL PREFERENCE
FOR PARTICIPANTS.

 

5.2                                 TRUST ASSETS.  INTEREST EARNED ON AMOUNTS
DEPOSITED BY THE COMPANY INTO THE TRUST WILL BE FOR THE ACCOUNT OF THE COMPANY,
AND, AFTER PAYMENT OF ALL CASH SEVERANCE BENEFITS TO THE PARTICIPANTS UNDER THIS
PLAN, ANY SURPLUS AMOUNT HELD IN THE TRUST WILL BE RETAINED BY THE COMPANY. IN
THE EVENT ANY PARTICIPANT WHO IS ELIGIBLE FOR SEVERANCE BENEFITS BECOMES SUBJECT
TO TAXES ON THE FULL AMOUNT HELD IN THE TRUST FOR SUCH PARTICIPANT’S BENEFIT,
THE COMPANY WILL DIRECTLY PAY ANY SUCH TAXES DUE FROM THE TRUST.

 

SECTION 6.                                EXCISE TAXES

 

6.1                                 GROSS-UP PAYMENT.

 

(A)                                  IN THE EVENT A PARTICIPANT BECOMES ENTITLED
TO RECEIVE PAYMENTS OF SEVERANCE BENEFITS UNDER THE PLAN, THE COMPANY WILL CAUSE
AN INDEPENDENT ACCOUNTING OR OTHER QUALIFIED FIRM (THE “TAX ADVISOR”) PROMPTLY
TO REVIEW, AT THE COMPANY’S SOLE EXPENSE, THE APPLICABILITY OF SECTION 4999 OF
THE CODE TO THOSE PAYMENTS. THE TAX ADVISOR WILL DETERMINE WHETHER THE PAYMENT
OF SEVERANCE BENEFITS OR ANY OTHER AMOUNTS BY THE COMPANY TO A PARTICIPANT OR
FOR A PARTICIPANT’S BENEFIT (WHETHER PAID OR PAYABLE PURSUANT TO THE TERMS OF
THIS PLAN OR OTHERWISE) (THE “TOTAL PAYMENTS”), WOULD BE SUBJECT TO THE EXCISE
TAX IMPOSED BY SECTION 4999 OF THE CODE, AND ANY INTEREST OR PENALTIES WITH
RESPECT TO SUCH EXCISE TAX (THE EXCISE TAX, TOGETHER WITH ANY SUCH INTEREST AND
PENALTIES, ARE COLLECTIVELY REFERRED TO HEREIN AS THE “EXCISE TAX”).

 

(B)                                 IF THE TAX ADVISOR DETERMINES THAT THE TOTAL
PAYMENTS WOULD BE SUBJECT TO ANY EXCISE TAX, THEN THE PARTICIPANT WILL BE
ENTITLED TO RECEIVE AN ADDITIONAL CASH PAYMENT (A “GROSS-UP PAYMENT”) EQUAL TO
AN AMOUNT SUCH THAT AFTER PAYMENT BY THE PARTICIPANT OF ALL EXCISE TAXES AND
OTHER TAXES (INCLUDING ANY INTEREST OR PENALTIES IMPOSED WITH RESPECT TO SUCH
TAXES) IMPOSED UPON THE GROSS-UP PAYMENT, THE PARTICIPANT WOULD RETAIN AN AMOUNT
OF THE GROSS-UP PAYMENT EQUAL TO THE EXCISE TAX IMPOSED UPON THE TOTAL PAYMENTS.
FOR PURPOSES OF DETERMINING THE AMOUNT OF ANY TAX PURSUANT TO THIS SECTION 6.1,
THE PARTICIPANT’S TAX RATE WILL BE DEEMED TO BE THE HIGHEST STATUTORY MARGINAL
FEDERAL AND STATE TAX RATE (ON A COMBINED BASIS AND INCLUDING THE PARTICIPANT’S
SHARE OF FICA AND MEDICARE TAXES) THEN IN EFFECT.

 

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(C)                                  NOTWITHSTANDING SECTION 6.1(B), IF THE TAX
ADVISOR DETERMINES THAT ANY TIER 2 PARTICIPANT IS ENTITLED TO A GROSS-UP
PAYMENT, BUT THAT THE AGGREGATE PRESENT VALUE OF THE TOTAL PAYMENTS (DETERMINED
PURSUANT TO SECTION 280G OF THE CODE AND APPLICABLE REGULATIONS PROMULGATED
THEREUNDER) DOES NOT EXCEED 110% OF THE GREATEST AMOUNT (THE “SAFE HARBOR
AMOUNT”) THAT COULD BE PAID TO ANY TIER 2 PARTICIPANT SUCH THAT THE RECEIPT OF
PAYMENTS UNDER THIS PLAN WOULD NOT GIVE RISE TO ANY EXCISE TAX, THEN NO GROSS-UP
PAYMENT WILL BE MADE TO SUCH TIER 2 PARTICIPANT. IN THIS CASE, THE AMOUNTS
PAYABLE UNDER THIS PLAN WILL BE REDUCED SO THAT THE AGGREGATE PRESENT VALUE OF
THE TOTAL PAYMENTS MADE TO THE TIER 2 PARTICIPANT IS REDUCED TO THE SAFE HARBOR
AMOUNT. IN THE EVENT THAT A CUT-BACK DESCRIBED IN THIS SECTION 6.1(C) IS
REQUIRED, AMOUNTS PAYABLE TO THE PARTICIPANT IN CASH SHALL BE REDUCED FIRST,
FOLLOWED BY A REDUCTION OF OTHER BENEFITS, AS DETERMINED BY THE TAX ADVISOR. IN
THE EVENT THAT THE TAX ADVISOR HAS NOT MADE A FINAL DETERMINATION AS TO WHETHER
A REDUCTION IN THE AGGREGATE PRESENT VALUE OF THE TOTAL PAYMENTS TO THE TIER 2
PARTICIPANT IS REQUIRED PURSUANT TO THIS SECTION 6.1(C) AS OF THE END OF THE
SIX-MONTH PERIOD FOLLOWING THE DATE PROVIDED IN SECTION 3.8 OF THIS PLAN, THE
COMPANY SHALL INITIALLY MAKE THE PAYMENT PROVIDED BY THIS AGREEMENT TO THE
TIER 2 PARTICIPANT AND HE OR SHE WILL BE REQUIRED TO REFUND TO THE COMPANY ANY
AMOUNTS ULTIMATELY DETERMINED NOT TO HAVE BEEN PAYABLE UNDER THE TERMS OF THIS
PLAN.

 

(D)                                 A PARTICIPANT WILL IN GOOD FAITH COOPERATE
WITH THE TAX ADVISOR IN MAKING THE DETERMINATION OF WHETHER A GROSS-UP PAYMENT
IS REQUIRED (INCLUDING, WITHOUT LIMITATION, PROVIDING THE TAX ADVISOR WITH
INFORMATION OR DOCUMENTATION AS REASONABLY REQUESTED BY THE TAX ADVISOR).

 

(E)                                  ANY DETERMINATION BY THE TAX ADVISOR
REGARDING WHETHER A GROSS-UP PAYMENT IS REQUIRED AND THE AMOUNT OF SUCH GROSS-UP
PAYMENT WILL BE CONCLUSIVE AND BINDING UPON THE PARTICIPANT AND THE COMPANY FOR
ALL PURPOSES.

 

6.2                                 PAYMENT DATE.  ANY GROSS-UP PAYMENT REQUIRED
TO BE MADE BY SECTION 6.1 WILL BE PAID TO PARTICIPANT WITHIN 30 DAYS OF A FINAL
DETERMINATION BY THE TAX ADVISOR THAT THE GROSS-UP PAYMENT IS REQUIRED;
PROVIDED, HOWEVER, THAT THE GROSS-UP PAYMENT WILL NOT BE PAID EARLIER THAN THE
PARTICIPANT’S “EARLIEST PAYMENT DATE,” WHICH DATE WILL BE THE LAST DAY OF THE
SIX-MONTH PERIOD FOLLOWING THE DATE OF THE PARTICIPANT’S QUALIFYING TERMINATION
(OR, IF SUCH PARTICIPANT DIES PRIOR TO THE END OF SUCH SIX-MONTH PERIOD, THE
DATE OF SUCH PARTICIPANT’S DEATH). IN ANY EVENT, PAYMENT OF ANY REQUIRED
GROSS-UP PAYMENT WILL BE MADE BY THE LATER OF (A) THE LAST DAY OF THE TAXABLE
YEAR IN WHICH THE PARTICIPANT’S EARLIEST PAYMENT DATE OCCURS OR (B) THE DATE
THAT IS TWO AND ONE-HALF MONTHS AFTER SUCH EARLIEST PAYMENT DATE.

 

6.3                                 CONTROVERSIES WITH TAXING AUTHORITIES.

 

(A)                                  THE COMPANY AND A PARTICIPANT WILL PROMPTLY
DELIVER TO EACH OTHER COPIES OF ANY WRITTEN COMMUNICATIONS (AND WRITTEN
SUMMARIES OF ANY ORAL COMMUNICATIONS) WITH ANY TAXING AUTHORITY REGARDING THE
APPLICABILITY OF SECTION 280G OR 4999 OF THE CODE TO ANY PORTION OF THE TOTAL
PAYMENTS. IN THE EVENT OF ANY CONTROVERSY WITH THE INTERNAL REVENUE SERVICE OR
OTHER TAXING AUTHORITY WITH REGARD TO THE APPLICABILITY OF SECTION 280G OR 4999
OF THE CODE TO ANY PORTION OF THE TOTAL PAYMENTS, THE COMPANY WILL HAVE THE
RIGHT (EXERCISABLE IN ITS SOLE DISCRETION) TO CONTROL THE RESOLUTION OF SUCH
CONTROVERSY AT

 

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ITS OWN EXPENSE. THE PARTICIPANT AND THE COMPANY WILL COOPERATE IN GOOD FAITH IN
THE RESOLUTION OF SUCH CONTROVERSY.

 

(B)                                 IF THE INTERNAL REVENUE SERVICE OR ANY OTHER
TAXING AUTHORITY MAKES A FINAL DETERMINATION THAT A GREATER EXCISE TAX SHOULD BE
IMPOSED UPON THE TOTAL PAYMENTS THAN IS DETERMINED BY THE TAX ADVISOR OR
REFLECTED IN THE PARTICIPANT’S TAX RETURN PURSUANT TO SECTION 6.2, THE
PARTICIPANT WILL BE ENTITLED TO RECEIVE FROM THE COMPANY THE FULL GROSS-UP
PAYMENT CALCULATED ON THE BASIS OF THE AMOUNT OF EXCISE TAX DETERMINED TO BE
PAYABLE BY THE INTERNAL REVENUE SERVICE OR SUCH OTHER TAXING AUTHORITY. SUCH
AMOUNT WILL BE PAID TO SUCH PARTICIPANT WITHIN 30 DAYS OF THE DATE OF SUCH FINAL
DETERMINATION BY THE INTERNAL REVENUE SERVICE OR SUCH OTHER TAXING AUTHORITY.

 

SECTION 7.                                CLAIMS PROCEDURE

 

7.1                                 ORIGINAL CLAIM.  ANY PARTICIPANT, FORMER
PARTICIPANT, OR BENEFICIARY OF SUCH PARTICIPANT OR FORMER PARTICIPANT, IF HE OR
SHE SO DESIRES, MAY FILE WITH THE COMMITTEE A WRITTEN CLAIM FOR SEVERANCE
BENEFITS UNDER THIS PLAN. WITHIN 90 DAYS AFTER THE FILING OF SUCH A CLAIM, THE
COMMITTEE WILL NOTIFY THE CLAIMANT IN WRITING WHETHER THE CLAIM IS UPHELD OR
DENIED (IN WHOLE OR IN PART), OR WILL FURNISH THE CLAIMANT A WRITTEN NOTICE
DESCRIBING SPECIFIC SPECIAL CIRCUMSTANCES REQUIRING A SPECIFIED AMOUNT OF
ADDITIONAL TIME (BUT NOT MORE THAN 180 DAYS FROM THE DATE THE CLAIM WAS FILED)
TO REACH A DECISION ON THE CLAIM. IF THE CLAIM IS DENIED IN WHOLE OR IN PART,
THE COMMITTEE WILL STATE IN WRITING:

 

(A)                                  THE SPECIFIC REASONS FOR THE DENIAL;

 

(B)                                 THE PERTINENT PROVISIONS OF THIS PLAN ON
WHICH THE DENIAL IS BASED; AND

 

(C)                                  ANY ADDITIONAL MATERIAL OR INFORMATION
NECESSARY FOR THE CLAIMANT TO PERFECT THE CLAIM, AND AN EXPLANATION OF WHY SUCH
MATERIAL OR INFORMATION IS NECESSARY.

 

7.2                                 GENERAL RULES.  THE FOLLOWING GENERAL RULES
WILL APPLY TO ALL CLAIMS FOR SEVERANCE BENEFITS:

 

(A)                                  NO INQUIRY OR QUESTION FROM A PARTICIPANT
REGARDING SEVERANCE BENEFITS WILL BE DEEMED TO BE A CLAIM, UNLESS MADE IN
ACCORDANCE WITH THE PROCEDURES DESCRIBED IN SECTION 7.1. THE COMMITTEE MAY
REQUIRE THAT ANY CLAIM FOR BENEFITS BE FILED ON FORMS TO BE FURNISHED TO THE
CLAIMANT UPON REQUEST.

 

(B)                                 ALL DECISIONS ON CLAIMS WILL BE MADE BY THE
COMMITTEE;

 

(C)                                  THE COMMITTEE MAY, IN ITS DISCRETION, HOLD
ONE OR MORE HEARINGS ON A CLAIM OR A REQUEST FOR A REVIEW OF A DENIED CLAIM;

 

(D)                                 A CLAIMANT MAY BE REPRESENTED BY A LAWYER OR
OTHER REPRESENTATIVE (AT THE CLAIMANT’S OWN EXPENSE), BUT THE COMMITTEE RESERVES
THE RIGHT TO REQUIRE THE CLAIMANT TO FURNISH WRITTEN NOTICE THAT SUCH LAWYER OR
OTHER REPRESENTATIVE IS AUTHORIZED TO REPRESENT THE CLAIMANT;

 

14

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(E)                                  THE DECISION OF THE COMMITTEE ON A CLAIM
WILL BE PROVIDED TO THE CLAIMANT IN WRITING. IF A DECISION OR NOTICE IS NOT
RECEIVED BY A CLAIMANT WITHIN THE TIME SPECIFIED, THE CLAIM OR REQUEST FOR A
REVIEW OF A DENIED CLAIM WILL BE DEEMED TO HAVE BEEN DENIED; AND

 

(F)                                    PRIOR TO FILING A CLAIM, THE CLAIMANT OR
HIS OR HER LAWYER OR OTHER REPRESENTATIVE WILL HAVE A REASONABLE OPPORTUNITY TO
REVIEW A COPY OF THIS PLAN AND ALL OTHER PERTINENT DOCUMENTS IN THE POSSESSION
OF THE COMPANY.

 

SECTION 8.                                RIGHTS TO SEVERANCE BENEFITS AND LEGAL
FEES

 

8.1                                 SEVERANCE BENEFITS PAYMENTS.

 

(A)                                  THIS PLAN ESTABLISHES IN A PARTICIPANT A
RIGHT TO THE SEVERANCE BENEFITS TO WHICH SUCH PARTICIPANT IS ENTITLED HEREUNDER,
SUBJECT TO THE CONDITIONS OF SECTION 4 AND TO THE COMMITTEE’S RIGHT TO TERMINATE
OR AMEND THIS PLAN IN ACCORDANCE WITH SECTION 1.3 AND 10.8. THE COMPANY’S
OBLIGATION TO MAKE THE PAYMENTS OR DISTRIBUTIONS WITH RESPECT TO SEVERANCE
BENEFITS WILL NOT BE AFFECTED BY ANY CIRCUMSTANCES (INCLUDING, WITHOUT
LIMITATION, ANY OFFSET, COUNTERCLAIM, RECOUPMENT, DEFENSE OR OTHER RIGHT WHICH
THE COMPANY MAY HAVE AGAINST THE PARTICIPANT). NOTWITHSTANDING THE FOREGOING
SENTENCE, THE COMPANY WILL HAVE NO OBLIGATION TO MAKE ANY PAYMENT TO ANY
PARTICIPANT UNDER THIS PLAN TO THE EXTENT (BUT ONLY TO THE EXTENT) THAT SUCH
PAYMENT IS PROHIBITED BY THE TERMS OF ANY FINAL ORDER OF A FEDERAL OR STATE
COURT OR REGULATORY AGENCY OF COMPETENT JURISDICTION. SUCH FINAL ORDER WILL NOT
AFFECT, IMPAIR OR INVALIDATE ANY PROVISION OF THIS PLAN NOT EXPRESSLY SUBJECT TO
SUCH ORDER.

 

(B)                                 A PARTICIPANT WILL NOT BE OBLIGATED TO SEEK
OTHER EMPLOYMENT IN MITIGATION OF THE SEVERANCE BENEFITS THE COMPANY IS REQUIRED
TO PROVIDE UNDER THIS PLAN, AND THE OBTAINING OF ANY SUCH OTHER EMPLOYMENT WILL
IN NO EVENT EFFECT ANY REDUCTION OF THE COMPANY’S OBLIGATIONS TO PROVIDE
SEVERANCE BENEFITS UNDER THIS PLAN.

 

8.2                                 LEGAL FEES AND EXPENSES.  THE COMPANY WILL
PAY ALL REASONABLE LEGAL FEES, COSTS OF LITIGATION, PREJUDGMENT INTEREST AND
OTHER EXPENSES THAT ARE INCURRED IN GOOD FAITH BY A PARTICIPANT AS A RESULT OF
(A) THE COMPANY’S REFUSAL TO PROVIDE THE SEVERANCE BENEFITS TO WHICH THE
PARTICIPANT BECOMES ENTITLED UNDER THIS PLAN, (B) THE COMPANY (OR ANY THIRD
PARTY) CONTESTING THE VALIDITY, ENFORCEABILITY OR INTERPRETATION OF THIS PLAN OR
(C) ANY CONFLICT BETWEEN THE PARTICIPANT AND THE COMPANY PERTAINING TO THIS
PLAN; PROVIDED, HOWEVER, THAT IF A COURT DETERMINES THAT THE PARTICIPANT’S
CLAIMS WERE BROUGHT WITHOUT A REASONABLE BELIEF IN THE MERITS OF SUCH CLAIMS,
THE COMPANY WILL HAVE NO OBLIGATIONS UNDER THIS SECTION 8.2.

 

SECTION 9.                                SUCCESSORS

 

9.1                                 SUCCESSORS TO THE COMPANY.  THE COMPANY WILL
REQUIRE ANY SUCCESSOR TO THE COMPANY (WHETHER DIRECT OR INDIRECT, BY PURCHASE,
MERGER, REORGANIZATION, CONSOLIDATION, ACQUISITION OF PROPERTY OR STOCK,
LIQUIDATION OR OTHERWISE) TO EXPRESSLY ASSUME AND AGREE TO PERFORM THIS PLAN IN
THE SAME MANNER AND TO THE SAME EXTENT THAT THE COMPANY WOULD BE REQUIRED TO
PERFORM IF NO SUCH SUCCESSION HAD TAKEN PLACE. REGARDLESS OF WHETHER SUCH AN
AGREEMENT TO SUCH EXPRESS ASSUMPTION IS OBTAINED, THIS PLAN WILL BE BINDING UPON
ANY SUCCESSOR

 

15

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IN ACCORDANCE WITH THE OPERATION OF LAW, AND SUCH SUCCESSOR WILL BE DEEMED TO BE
THE “COMPANY” FOR PURPOSES OF THIS PLAN.

 

9.2                                 ASSIGNMENT BY THE PARTICIPANT.  THIS PLAN
WILL INURE TO THE BENEFIT OF AND BE ENFORCEABLE BY THE PARTICIPANT’S PERSONAL OR
LEGAL REPRESENTATIVES OR DESIGNATED BENEFICIARIES. IF THE PARTICIPANT DIES WHILE
ANY AMOUNT WOULD STILL BE PAYABLE TO SUCH PARTICIPANT HAD HE OR SHE CONTINUED TO
LIVE, ALL SUCH AMOUNTS WILL BE PAID IN ACCORDANCE WITH THE TERMS OF THIS PLAN TO
SUCH PARTICIPANT’S DESIGNATED (OR, IF THERE ARE NO SUCH DESIGNATED
BENEFICIARIES, TO THE PARTICIPANT’S ESTATE).

 

SECTION 10.                          MISCELLANEOUS

 

10.1                           ADMINISTRATION AND COMMITTEE POWERS.  THIS PLAN
WILL BE ADMINISTERED BY THE COMMITTEE. THE COMMITTEE WILL HAVE FULL POWER,
DISCRETION AND AUTHORITY TO INTERPRET AND CONSTRUE THIS PLAN, AND THE
COMMITTEE’S INTERPRETATION AND CONSTRUCTION OF THIS PLAN WILL BE CONCLUSIVE AND
BINDING ON THE PARTICIPANTS, THE COMPANY AND ALL OTHER PERSONS.

 

10.2                           EMPLOYMENT STATUS.  THIS PLAN IS NOT, AND NOTHING
HEREIN WILL BE DEEMED TO CREATE, AN EMPLOYMENT CONTRACT BETWEEN THE PARTICIPANT
AND THE COMPANY. THE COMPANY MAY AT ANY TIME CHANGE ANY PARTICIPANT’S
COMPENSATION, TITLE, EMPLOYMENT RESPONSIBILITIES, JOB LOCATION AND ANY OTHER
ASPECT OF THE COMPANY’S EMPLOYMENT RELATIONSHIP WITH SUCH PARTICIPANT, OR
TERMINATE SUCH PARTICIPANT’S EMPLOYMENT PRIOR TO A CHANGE IN CONTROL (SUBJECT TO
SUCH TERMINATION BEING DETERMINED TO BE A PRE-CHANGE IN CONTROL QUALIFYING
TERMINATION PURSUANT TO SECTION 3.1(B)).

 

10.3                           ENTIRE PLAN AND OTHER CHANGE IN CONTROL PLANS.

 

(A)                                  THIS PLAN CONTAINS THE ENTIRE UNDERSTANDING
OF THE COMPANY AND THE PARTICIPANT WITH RESPECT TO THE SUBJECT MATTER HEREOF. IN
ADDITION, THE PAYMENT OF ANY SEVERANCE BENEFITS IN THE EVENT OF A PARTICIPANT’S
TERMINATION OF EMPLOYMENT WILL BE IN LIEU OF ANY SEVERANCE BENEFITS PAYABLE
UNDER ANY OTHER SEVERANCE PLAN, PROGRAM OR POLICY OF THE COMPANY TO WHICH THE
PARTICIPANT MIGHT OTHERWISE BE ENTITLED.

 

(B)                                 THIS PLAN COMPLETELY SUPERSEDES ANY AND ALL
PRIOR CHANGE IN CONTROL SEVERANCE AGREEMENTS, UNDERSTANDINGS OR PLANS
(INCLUDING, WITHOUT LIMITATION, THE INCOME SECURITY PLAN, AS IN EFFECT
IMMEDIATELY PRIOR TO THE EFFECTIVE DATE), ORAL OR WRITTEN, ENTERED INTO BETWEEN
THE COMPANY AND A PARTICIPANT.

 

10.4                           NOTICES.  ALL NOTICES, REQUESTS, DEMANDS, AND
OTHER COMMUNICATIONS HEREUNDER WILL BE SUFFICIENT IF IN WRITING AND WILL BE
DEEMED TO HAVE BEEN DULY GIVEN IF DELIVERED BY HAND OR IF SENT BY REGISTERED OR
CERTIFIED MAIL TO THE PARTICIPANT AT THE LAST ADDRESS HE OR SHE HAS FILED IN
WRITING WITH THE COMPANY, OR, IN THE CASE OF THE COMPANY, AT ITS PRINCIPAL
EXECUTIVE OFFICES.

 

10.5                           INCLUDABLE COMPENSATION.  SEVERANCE BENEFITS
PROVIDED HEREUNDER WILL NOT BE CONSIDERED “INCLUDABLE COMPENSATION,” “RECOGNIZED
COMPENSATION,” “RECOGNIZED EARNINGS” OR “FINAL AVERAGE EARNINGS” FOR PURPOSES OF
DETERMINING THE PARTICIPANT’S BENEFITS UNDER ANY OTHER PLAN OR PROGRAM OF THE
COMPANY, UNLESS OTHERWISE EXPRESSLY PROVIDED IN SUCH OTHER PLAN OR PROGRAM.

 

16

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10.6                           TAX WITHHOLDING.  THE COMPANY WILL WITHHOLD FROM
ANY AMOUNTS PAYABLE UNDER THIS PLAN ALL FEDERAL, STATE OR OTHER TAXES LEGALLY
REQUIRED TO BE WITHHELD.

 

10.7                           SEVERABILITY.  IN THE EVENT ANY PROVISION OF THIS
PLAN IS HELD ILLEGAL OR INVALID FOR ANY REASON, THE ILLEGALITY OR INVALIDITY
WILL NOT AFFECT THE REMAINING PARTS OF THIS PLAN, AND THIS PLAN WILL BE
CONSTRUED AND ENFORCED AS IF THE ILLEGAL OR INVALID PROVISION HAD NOT BEEN
INCLUDED.

 

10.8                           AMENDMENT AND WAIVER.

 

(A)                                  ANY PROVISION OF THIS PLAN MAY BE AMENDED
OR MODIFIED (WHICH MODIFICATION MAY INCLUDE THE TERMINATION OF ANY PARTICIPANT’S
PARTICIPATION IN THIS PLAN) BY THE COMMITTEE AT ANY TIME; PROVIDED, HOWEVER,
THAT (I) DURING THE PERIOD BEGINNING ON THE DATE OF A CHANGE IN CONTROL AND
ENDING ON THE THIRD ANNIVERSARY DATE OF SUCH CHANGE IN CONTROL, NO PROVISION OF
THIS PLAN MAY BE AMENDED OR MODIFIED (UNLESS SUCH MODIFICATION OR WAIVER IS
AGREED TO IN WRITING BY ANY AFFECTED PARTICIPANT) AND (II) IF A CHANGE EVENT
OCCURS DURING THE 12-MONTH PERIOD IMMEDIATELY PRIOR TO THE DATE OF A CHANGE IN
CONTROL, ANY AMENDMENT OR MODIFICATION TO THIS PLAN DURING SUCH 12-MONTH PERIOD
WILL BE DEEMED NULL AND VOID (UNLESS SUCH MODIFICATION OR AMENDMENT IS AGREED TO
IN WRITING BY ANY AFFECTED PARTICIPANT).

 

(B)                                 ANY PROVISIONS OF THIS AGREEMENT MAY BE
WAIVED IN WRITING BY THE COMPANY OR THE PARTICIPANT, AS THE CASE MAY BE.

 

10.9                           APPLICABLE LAW.  THE LAWS OF THE STATE OF
DELAWARE WILL BE THE CONTROLLING LAW IN ALL MATTERS RELATING TO THIS PLAN
WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS.

 

10.10                     RULES OF CONSTRUCTION.  CAPTIONS ARE PROVIDED IN THIS
PLAN FOR CONVENIENCE ONLY, AND SUCH CAPTIONS WILL NOT SERVE AS A BASIS FOR
INTERPRETATION OR CONSTRUCTION HEREOF. UNLESS OTHERWISE EXPRESSLY PROVIDED OR
UNLESS THE CONTEXT OTHERWISE REQUIRES, THE TERMS DEFINED IN THIS PLAN INCLUDE
THE PLURAL AND THE SINGULAR.

 

17

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Exhibit A

 

[FORM AGREEMENT for INCOME SECURITY PLAN]

 

SEPARATION AGREEMENT

 

AND

 

GENERAL RELEASE OF CLAIMS

 

This Separation Agreement and General Release of Claims (“Agreement” or “General
Release”) is made and entered into by and between [employee name], on behalf of
his/her agents, assigns, heirs, executors, administrators, attorneys and
representatives (“I,” “me,” “Employee”), and Alliant Techsystems Inc., a
Delaware corporation, [include new company name if applicable] any related
corporations or affiliates, subsidiaries, predecessors, successors and assigns,
present or former officers, directors, stockholders, board members, agents,
employees, and attorneys, whether in their individual or official capacities,
delegates, benefit plans and plan administrators, and insurers (“Company” or
“ATK”).

 

WHEREAS, ATK and I have mutually agreed that my employment shall terminate as
provided in this General Release. In consideration of my signing and complying
with this General Release, ATK agrees to provide me with certain payments and
other valuable consideration described below. Further, ATK and I desire to
resolve and settle any and all potential disputes or claims related to my
employment or termination of employment.

 

WHEREAS, this Separation Agreement and General Release is given in consideration
of benefits received pursuant to the Alliant Techsystems Inc. Income Security
Plan.

 

WHEREAS, ATK has expended significant time and money on promotion, advertising,
and the development of goodwill and a sound business reputation through which it
has developed a list of customers and spent time and resources to learn the
customers’ needs for ATK’s services and products. This information is valuable,
special and unique assets of ATK’s business, which I acknowledge constitutes
confidential information.

 

WHEREAS, ATK has expended significant time and money on technology, research,
and development through which it has developed products, processes, technologies
and services, that are valuable, special and unique assets of ATK’s business,
which I acknowledge constitute confidential information.

 

WHEREAS, the disclosure to or use by third parties of any of ATK’s confidential
or proprietary information, trade secrets, or my unauthorized use of such
information would seriously harm ATK’s business and cause monetary loss that
would be difficult, if not impossible, to measure.

 

THEREFORE, ATK and I mutually agree to the following terms and conditions:

 

A-1

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1.                                       Termination of Employment.  I
understand my employment with ATK is terminated effective [date].

 

(A)                                  FINAL PAYCHECK.  MY FINAL PAYCHECK WILL
INCLUDE (A) ALL SALARY EARNED THROUGH THE EFFECTIVE DATE OF THE TERMINATION OF
MY EMPLOYMENT WITH ATK, (B) ANY ACCRUED, BUT UNUSED VACATION/PTO, AND (C) ANY
CASH AMOUNTS COMPLETELY EARNED AND OWING UNDER ANY BONUS PLAN, BUT NOT YET PAID.

 

(B)                                 DEFERRED COMPENSATION.  ANY COMPENSATION I
DEFERRED UNDER THE ALLIANT TECHSYSTEMS INC. NONQUALIFIED DEFERRED COMPENSATION
PLAN (OR PREDECESSOR OR SUCCESSOR PLAN) SHALL BE PAID IN ACCORDANCE WITH MY
PRE-SELECTED DISTRIBUTION OPTIONS, IF APPLICABLE, AND THE TERMS OF THAT PLAN.

 

2.                                       Severance Benefits.  In exchange for
the promises contained herein, ATK will provide me with the severance benefits
contained in the ATK Income Security Plan and with any additional benefits
identified in this Paragraph 2 (together referred to as “Severance Benefits”):

 

(A)                                  SEVERANCE PAY.  I AM ELIGIBLE TO RECEIVE A
SINGLE LUMP-SUM SEVERANCE PAYMENT IN THE AMOUNT OF [$          ], WHICH IS MADE
UP OF [LIST THE AMOUNT AND CATEGORY OF COMPENSATION, EX:  BASE SALARY, ANNUAL
INCENTIVE BONUS, ETC…]. THIS SEVERANCE PAYMENT WILL BE SUBJECT TO ALL APPLICABLE
WITHHOLDINGS AND WILL BE TAXABLE AS PAYROLL WAGES. NO 401(K) DEDUCTIONS WILL BE
TAKEN FROM THE PAYMENT NOR IS IT PENSIONABLE EARNINGS (FOR EXAMPLE, IT IS NOT
“EARNINGS” OR “RECOGNIZED COMPENSATION”) FOR PURPOSES OF ANY ATK QUALIFIED OR
NON-QUALIFIED EMPLOYEE BENEFITS PLANS.

 

(B)                                 ADDITIONAL LUMP SUM.  I AM ELIGIBLE TO
RECEIVE A SINGLE LUMP-SUM PAYMENT IN THE AMOUNT OF [$          ] IN
CONSIDERATION OF CERTAIN PERQUISITES AND BENEFITS. THIS AMOUNT WILL BE SUBJECT
TO ALL APPLICABLE WITHHOLDINGS AND WILL BE TAXABLE AS PAYROLL WAGES. NO 401(K)
DEDUCTIONS WILL BE TAKEN FROM THE PAYMENT NOR IS IT PENSIONABLE EARNINGS (FOR
EXAMPLE, IT IS NOT “EARNINGS” OR “RECOGNIZED COMPENSATION”) FOR PURPOSES OF ANY
ATK QUALIFIED OR NON-QUALIFIED EMPLOYEE BENEFITS PLANS.

 

(C)                                  EQUITY AWARDS

 

(i)                                     Restricted Stock.  [I have xx shares of
restricted stock which will become nonforfeitable and free and clear of the
restrictions of the plan from which they were issued.]

 

(ii)                                  Performance Shares.  [Identify outstanding
performance shares. Provide details on grant, vesting and delivery. Include the
number of shares, proration, if any, and delivery.]

 

(iii)                               Stock Options.  [Identify status of stock
options. Provide details on the number of shares, the grant, vesting, and
exercisability.]

 

A-2

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(D)                                 INDEPENDENT CONSIDERATION.  I AM ONLY
ELIGIBLE FOR SEVERANCE BENEFITS BECAUSE I HAVE SIGNED AND NOT REVOKED THIS
GENERAL RELEASE. I ACKNOWLEDGE THAT I AM NOT OTHERWISE ENTITLED TO RECEIVE SUCH
ADDITIONAL AND VALUABLE CONSIDERATION. BY MY SIGNATURE ON THIS GENERAL RELEASE,
I WAIVE ALL RIGHTS TO ANY OTHER BENEFITS OR CASH PAYMENT. FURTHER, I AGREE THAT
THESE SEVERANCE BENEFITS ARE ADEQUATE CONSIDERATION FOR MY PROMISES HEREIN.

 

(E)                                  DELIVERY OF SEVERANCE PAY AND ADDITIONAL
LUMP SUM.  ATK WILL DELIVER TO ME THE CASH AMOUNTS UNDER PARAGRAPH 2(A) AND (B),
THE SEVERANCE PAY AND ADDITIONAL LUMP SUM, WITHIN 30 DAYS OF SIX MONTHS AFTER MY
TERMINATION DATE, PROVIDED THAT THE APPLICABLE RESCISSION PERIOD HAS ALSO
ELAPSED. THIS DELIVERY DATE MAY BE DELAYED FURTHER IF NECESSARY TO BE COMPLIANT
WITH SECTION 409A OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED FROM
TIME TO TIME.

 

3.                                       Post Employment Restrictions.

 

(a)                                  Confidentiality and Non-Disparagement.  I
acknowledge that in the course of my employment with ATK, I have had access to
confidential information and trade secrets. If I hold a U.S. Government issued
security clearance, I acknowledge my personal obligations to maintain the
confidentiality of information gained under that clearance. I agree to maintain
the confidentiality of ATK’s confidential information and trade secrets. I will
not disclose or otherwise make available to any person, company, or other party
confidential information or trade secrets. Further, I agree not to make any
disparaging or defamatory comments about any ATK employee, director, or officer,
the Company, or any aspect of my employment or termination from employment with
ATK.

 

(b)                                 Competition Restrictions.  From [date]
through [date – Tier 1 – 3 years, Tier 2 – 2 years], I agree I will not directly
or indirectly, engage in, nor own, manage, operate, join, control, consult with,
participate in the ownership, operation or control of, or be employed by any
person or entity that develops, manufactures, distributes, markets or sells
services or products competitive with those that ATK manufactures, markets or
sells to any customer anywhere in the world. If during this restricted period I
wish to obtain other non-competitive employment, I agree to meet and confer in
good faith with ATK, prior to accepting such employment. I will provide ATK with
the name of any potential future employer and give ATK the right to provide a
copy of this provision to said potential employer.

 

(c)                            Non-solicitation.  From [date] through [date –
Tier 1 – 3 years, Tier 2 – 2 years], I will not, directly or indirectly solicit
any of ATK’s employees for the purpose of hiring them or inducing them to leave
their employment with ATK, nor will I own manage, operate, join, control,
consult with, participate in the ownership, management, operation or control of,
or be employed by any person or entity that engages in the conduct proscribed by
this paragraph during the restricted period.

 

(d)                           Access.  I agree to be available to ATK for up to
thirty hours per month [if Tier 1 – for one year, if Tier 2 – for 6 months],
from my termination date to aid in transitioning information, supporting
customer’s needs or other requests of ATK.

 

A-3

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(e)                            Breach of Post-Employment Restrictions.  If I
breach any of my obligations under this Paragraph 3, then I will not be entitled
to, and shall return, 75 percent of the Severance Benefit provided in Paragraph
2. ATK will be entitled to attorney’s fees and costs incurred in seeking
injunctive relief and damages including collecting the repayment of applicable
consideration as specified above. Such action on the part of ATK will not in any
way affect the enforceability of my General Release of Claims provided in
Paragraph 5, which is adequately supported by the remaining Severance Benefits
provided in Paragraph 2.

 

4.                                       Return of ATK Property.  Prior to my
last day of employment, I agree to return all ATK property in my possession or
control including, but not limited to, confidential or proprietary information,
credit card, computer, documents, records, correspondence, identification badge,
files, keys, software, and equipment. Further, I agree to repay to ATK any
amounts that I owe for personal credit card expenses, wage advances, employee
store purchases, and used, but unaccrued, vacation/PTO time. These debts may be
withheld from my severance payment, if any.

 

5.                                       General Release of Claims.  Except as
stated in Paragraph 7, I hereby release and forever discharge ATK from all
claims and causes of action, whether I currently have knowledge of such claims
and causes of action, arising, or which may have arisen, out of or in connection
with my employment or termination of employment with ATK. This includes, but is
not limited to claims, demands or actions arising under any federal or state law
such as the Age Discrimination in Employment Act (“ADEA”), the Older Workers
Benefit Protection Act (“OWBPA”), Title VII of the Civil Rights Act of 1964
(“Title VII”), the Americans with Disabilities Act (“ADA”), the Family Medical
Leave Act (“FMLA”), the Employee Retirement Income Security Act of 1978
(“ERISA”), the Worker Adjustment Retraining and Notification Act (“WARN”), the
Fair Labor Standards Act (“FLSA”), the National Labor Relations Act (“NLRA”),
the Occupational Safety and Health Act (“OSHA”), the Rehabilitation Act, the
Minnesota Human Rights Act, and Minn. Stat. Chap. 181, all as amended.

 

This General Release includes any claims arising under state human rights or
fair employment practices act, or any other federal, state or local statute,
ordinance, regulation or order regarding conditions of employment, compensation
for employment, termination of employment, or discrimination or harassment in
employment on the basis of age, gender, race, religion, disability, national
origin, sexual orientation, or any other protected characteristic, and the
common law of any state.

 

I further understand that this General Release extends to all claims which I may
have as of this date against ATK based upon statutory or common law claims for
breach of contract, breach of employee handbooks or other policies, breach of
promises, fraud, wrongful discharge, defamation, emotional distress,
whistleblower claims, negligence, assault, battery, or any other theory, whether
legal or equitable.

 

I agree that this General Release includes claims for all damages available
under any theory of recovery, including, without limitation, any compensatory
damages (including all forms of back-pay or front-pay), attorneys’ fees,
liquidated damages, punitive damages, treble damages, emotional distress
damages, pain and suffering damages, consequential damages, incidental

 

A-4

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damages, statutory fines or penalties, and/or costs or disbursements. Except as
stated in Paragraph 7, I am completely and fully waiving any rights under the
above stated statutes, regulations, laws, or legal or equitable theories.

 

6.                                       Breach of General Release of Claims.
 If I breach any provision of the General Release of Claims provided in
Paragraph 5, then I will not be entitled to, and shall return, 25 percent of the
Severance Benefit provided in Paragraph 2. ATK will be entitled to attorney’s
fees and costs incurred in its defense including collecting the repayment of
applicable consideration. Such action on the part of ATK will not in any way
effect the enforceability of the Post-Employment Restrictions provided in
Paragraph 3, which are adequately supported by the remaining Severance Benefits
provided in Paragraph 2.

 

7.                                       Exclusions from General Release.  I am
not waiving my right to enforce the terms of this General Release or to
challenge the knowing and voluntary nature of this General Release under the
ADEA as amended; or my right to assert claims that are based on events that
happen after this General Release becomes effective. I agree that ATK reserves
any and all defenses, which it has or might have against any claims brought by
me. This includes, but is not limited to, ATK’s right to seek available costs
and attorneys’ fees, and to have any money or other damages that might be
awarded to me, reduced by the amount of money paid to me pursuant to this
General Release. Nothing in this General Release interferes with my right to
file a charge with the Equal Employment Opportunity Commission (“EEOC”), or to
participate in an EEOC investigation or proceeding. Nevertheless, I understand
that I have waived my right to recover any individual relief or money damages,
which may be awarded on such a charge.

 

8.                                       Right to Revoke.  This General Release
does not become effective for a period of fifteen (15) days after I sign it and
I have the right to cancel it during that time. Any decision to revoke this
General Release must be made in writing and hand-delivered to ATK or, if sent by
mail, postmarked within the fifteen (15) day time period and addressed to
[insert name] Alliant Techsystems Inc., 5050 Lincoln Drive, Edina, MN 55436. I
understand that if I decide to revoke this General Release, I will not be
entitled to any Severance Benefits.

 

9.                                       Unemployment Compensation Benefits.  If
I apply for unemployment compensation, ATK will not challenge my entitlement to
such benefits. I understand that ATK does not decide whether I am eligible for
unemployment compensation benefits, or the amount of the benefit.

 

10.                                 No Wrongdoing.  By entering into this
General Release, ATK does not admit that it has acted wrongfully with respect to
my employment or that I have any rights or claims against it.

 

11.                                 No Adequate Remedy at Law.  I acknowledge
and agree that my breach of the Post-Employment Restrictions provided in
Paragraph 3 would cause irreparable harm to the Company and the remedy at law
would be inadequate. Accordingly, if I violate such Paragraph, ATK is entitled
to injunctive relief in addition to any other legal or equitable remedies.

 

12.                                 Choice of Law and Venue.  The terms of this
General Release will be governed by the laws of Minnesota (without regard to
conflict of laws principles). Any legal action to enforce this General Release
shall be brought in a court of law in Hennepin County, Minnesota.

 

A-5

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13.                                 Severability.  If any of the terms of this
General Release are deemed to be invalid or unenforceable by a court of law, the
validity and enforceability of the remaining provisions of this General Release
will not in any way be affected or impaired thereby. In the event that any court
having jurisdiction of the parties should determine that any of the
post-employment restrictions set forth in Paragraph 3 of this Agreement are
overbroad or otherwise invalid in any respect, I acknowledge and agree that the
court so holding shall construe those provisions to cover only that scope,
duration or extent or those activities which may validly and enforceably be
restricted, and shall enforce the restrictions as so construed. The parties
acknowledge the uncertainty of the law in this respect and expressly stipulate
that this Agreement shall be construed in a manner which renders its provisions
valid and enforceable to the maximum extent (not exceeding its express terms)
possible under applicable law.

 

14.                                 No Assignment.  This General Release is
personal to me and I cannot assign it to any other person or entity. In the
event of my death before all payments due to me under the terms of this
Agreement have been made, then all such payments shall continue to be made to my
estate.

 

15.                                 Attorneys’ Fees. I understand that I am
responsible to pay my own costs and attorneys’ fees, if any, that I incurred in
consulting with an attorney about this General Release.

 

16.                                 Entire Agreement.  This General Release
constitutes the entire agreement between ATK and me regarding the subject matter
included in this document. I agree that there are no promises or understandings
outside of this General Release, except with respect to my continuing
obligations not to reveal ATK’s proprietary, confidential, and trade secret
information. This General Release supercedes and replaces all prior or
contemporaneous discussions, negotiations or General Releases, whether written
or oral, except as set forth herein. Any modification or addition to this
General Release must be in writing, signed by an officer of ATK and me.

 

17.                                 Eligibility and Opportunity to Review.

 

(a)                                  All employees who are eligible to
participate in the Alliant Techsystems Inc. Income Security Plan must execute a
release of claims in order to receive Severance Benefits.

 

(B)                                 I CERTIFY THAT I AM SIGNING THIS GENERAL
RELEASE VOLUNTARILY AND WITH FULL KNOWLEDGE OF ITS CONSEQUENCES. I UNDERSTAND
THAT I HAVE AT LEAST [USE EITHER: “TWENTY-ONE (21) DAYS” IF INDIVIDUAL
TERMINATION OR “FORTY-FIVE (45) DAYS” IF MORE THAN ONE PERSON BEING TERMINATED] 
FROM THE DATE I RECEIVED THIS GENERAL RELEASE TO CONSIDER IT, AND THAT I DO NOT
HAVE TO SIGN IT BEFORE THE END OF THE TWENTY-ONE (21) DAY PERIOD. I HAVE BEEN
ADVISED TO USE THIS TIME TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS
GENERAL RELEASE.

 

(C)                                  I UNDERSTAND THAT THE OFFER TO ACCEPT THIS
GENERAL RELEASE REMAINS OPEN FOR [USE “TWENTY-ONE (21)” OR USE “FORTY-FIVE (45)”
– SEE COMMENT IN (B) ABOVE] DAYS. IF I HAVE NOT SIGNED THIS GENERAL RELEASE
WITHIN [“TWENTY-ONE (21)” OR “FORTY-FIVE (45)” – SEE COMMENT IN (B) ABOVE] DAYS
OF RECEIVING IT, THEN THIS OFFER EXPIRES AND ATK WILL BE UNDER NO OBLIGATION TO
ACCEPT THIS GENERAL RELEASE OR TO PROVIDE ME ANY SEVERANCE BENEFITS.

 

A-6

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18.                                 Understanding and Acknowledgement. I
understand all of the terms in this General Release and I have not relied on any
oral statements or explanations by ATK. I have had adequate time to consult with
legal counsel and to consider whether to sign this General Release, and I am
signing it knowingly and voluntarily.

 

IN WITNESS WHEREOF, Employee has executed this General Release by his signature
below.

 

Date:

 

 

[Insert employee name]

 

 

 

 

 

 

 

 

Employee’s Signature

 

A-7

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