exv10wp






Exhibit 10(p)




NORTHROP GRUMMAN CORPORATION




JANUARY 2010 CHANGE IN CONTROL SEVERANCE PLAN



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NORTHROP GRUMMAN CORPORATION




JANUARY 2010 CHANGE IN CONTROL SEVERANCE PLAN



Article 1. Establishment, Term, and Purpose




     1.1 Establishment of the Plan. Northrop Grumman Corporation (hereinafter referred to as the
“Company”) established a change in control severance plan known as the “Northrop Grumman
Corporation January 2010 Change in Control Severance Plan” (the “Plan”). The Plan is effective
January 1, 2010 (the “Effective Date”). The Plan supersedes the Northrop Grumman Corporation
January 2009 Change-in-Control Severance Plan in its entirety.



     1.2 Term of the Plan. This Plan will commence on the Effective Date and shall continue in
effect through December 31, 2010. However, at the end of such initial term and, if extended, at the
end of each additional year thereafter, the term of this Plan shall be extended automatically for
one (1) additional year, unless the Committee delivers written notice at least six (6) months prior
to the end of such term, or extended term, to each Participant that this Plan will not be extended
(a “Non-Renewal Notice”), and if such notice is timely given this Plan will terminate at the end of
the term then in progress; provided, however, that (i) this provision for automatic extension shall
have no application following a Change in Control of the Company and (ii) a Non-Renewal Notice
shall not be effective if delivered during the Protected Period corresponding to a Change in
Control. Delivery of a Non-Renewal Notice shall not constitute a repudiation or breach of this Plan
and shall not trigger any Participant’s right to benefits hereunder.



     However, in the event a Change in Control occurs during the initial or any extended term, this
Plan will remain in effect for the longer of: twenty-four (24) months beyond the month in which
such Change in Control occurred; or (ii) until all obligations of the Company hereunder have been
fulfilled, and until all benefits required hereunder have been paid to Participants. Any subsequent
Change in Control (“Subsequent Change in Control”) that occurs during the original or any extended
term shall also continue the term of this Plan until the later of: (i) twenty-four (24) months
beyond the month in which such Subsequent Change in Control occurred; or (ii) until all obligations
of the Company hereunder have been fulfilled, and until all benefits required hereunder have been
paid to Participants; provided, however, that if a Subsequent Change in Control occurs, it shall
only be considered a Change in Control under this Plan if it occurs no later than twenty-four (24)
months after the immediately preceding Change in Control or Subsequent Change in Control.



     1.3 Purpose of the Plan. The purpose of this Plan is to provide for continuity in the
management of the Company by offering certain key employees of the Company employment protection
and financial security in the event of a Change in Control of the Company.



     1.4 ERISA. This Plan is intended as (i) a pension plan within the meaning of Section 3(2) of
ERISA, and (ii) an unfunded pension plan maintained by the Company for a select group of management
or highly compensated employees within the meaning of



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Department of Labor Regulation 2520.104-23
promulgated under ERISA, and Sections 201, 301, and 401 of ERISA.



Article 2. Definitions




     Whenever used in this Plan, the following terms shall have the meanings set forth below and,
when the meaning is intended, the initial letter of the word is capitalized:




	 	(a)	 	“Base Salary” means the salary of record paid to a Participant by the Company
as annual salary (whether or not deferred), but excludes amounts received under
incentive or other bonus plans.
	 
	 	(b)	 	“Beneficial Owner” shall have the meaning ascribed to such term in Rule 13d-3
of the General Rules and Regulations under the Exchange Act.
	 
	 	(c)	 	“Beneficiary” in the event of a Participant’s death means the Participant’s
devisee, legatee, or other designee, or if there is no such designee, the Participant’s
estate.
	 
	 	(d)	 	“Board” means the Board of Directors of the Company.
	 
	 	(e)	 	“Cause” means the occurrence of either or both of the following:






	 	(i)	 	The Participant’s conviction for committing an act of fraud,
embezzlement, theft, or other act constituting a felony (other than traffic
related offenses or as a result of vicarious liability); or
	 
	 	(ii)	 	The willful engaging by the Participant in misconduct that is
significantly injurious to the Company. However, no act, or failure to act, on
the Participant’s part shall be considered “willful” unless done, or omitted to
be done, by the Participant not in good faith and without reasonable belief
that his or her action or omission was in the best interest of the Company.






	 	(f)	 	“Change in Control” of the Company shall be deemed to have occurred as of the
first day that any one or more of the following conditions shall have been satisfied:






	 	(i)	 	Any Person (other than those Persons in control of the Company
as of the Effective Date, or other than a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any affiliate of
the Company or a successor) becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing twenty-five percent (25%)
or more of either (1) the then-outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”) or (2) the combined voting
power of the then-outstanding voting securities of the Company entitled to vote
generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that for purposes of this clause (i): (A)
“Person” or “group” shall not include




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	 	 	 	underwriters acquiring newly issued
voting securities (or securities convertible into voting securities) directly
from the Company with a view towards distribution, (B) creditors of the Company
who become
stockholders of the Company in connection with any bankruptcy of the Company
under the laws of the United States shall not, by virtue of such bankruptcy,
be deemed a “group” or a single Person for the purposes of this clause (i)
(provided that any one of such creditors may trigger a Change in Control
pursuant to this clause (i) if such creditor’s ownership of Company
securities equals or exceeds the foregoing threshold), and (C) an
acquisition shall not constitute a Change in Control if made by an entity
pursuant to a transaction that is covered by and does not otherwise
constitute a Change in Control under clause (iii) below;






	 	(ii)	 	On any day after the Effective Date (the “Measurement Date”),
Continuing Directors cease for any reason to constitute either: (1) if the
Company does not have a Parent, a majority of the Board; or (2) if the Company
has a Parent, a majority of the Board of Directors of the Controlling Parent. A
director is a “Continuing Director” if he or she either:






	 	(1)	 	was a member of the Board on the applicable
Initial Date (an “Initial Director”); or
	 
	 	(2)	 	was elected to the Board (or the Board of
Directors of the Controlling Parent, as applicable), or was nominated
for election by the Company’s or the Controlling Parent’s stockholders,
by a vote of at least two-thirds (2/3) of the Initial Directors then in
office.






	 	 	 	A member of the Board (or Board of Directors of the Controlling Parent, as
applicable) who was not a director on the applicable Initial Date shall be
deemed to be an Initial Director for purposes of clause (2) above if his or
her election, or nomination for election by the Company’s or the Controlling
Parent’s stockholders, was approved by a vote of at least two-thirds (2/3)
of the Initial Directors (including directors elected after the applicable
Initial Date who are deemed to be Initial Directors by application of this
provision) then in office.
	 
	 	 	 	“Initial Date” means the later of (1) the Effective Date or (2) the date
that is two (2) years before the Measurement Date.
	 
	 	(iii)	 	Consummation of a reorganization, merger, statutory share
exchange or consolidation or similar corporate transaction involving the
Company or any of its subsidiaries, a sale or other disposition of all or
substantially all of the assets of the Company, or the acquisition of assets or
stock of another entity by the Company or any of its subsidiaries (each, a
“Business Combination”), in each case unless, following such Business




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	 	 	 	Combination, (1) all or substantially all of the individuals and entities that
were the Beneficial Owners of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities immediately prior to such
Business Combination Beneficially Own, directly or indirectly, more than
sixty percent (60%) of the then- outstanding shares of common stock and the
combined voting power of the then-outstanding voting securities entitled to
vote generally in the election of directors, as the case may be, of the
entity resulting from such Business Combination (including, without
limitation, an entity that, as a result of such transaction, is a Parent of
the Company or the successor of the Company) in substantially the same
proportions as their ownership immediately prior to such Business
Combination of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities, as the case may be, (2) no Person (excluding any
entity resulting from such Business Combination or a Parent of the Company
or any successor of the Company or any employee benefit plan (or related
trust) of the Company or such entity resulting from such Business
Combination or a Parent of the Company or the successor entity) Beneficially
Owns, directly or indirectly, twenty-five percent (25%) or more of,
respectively, the then-outstanding shares of common stock of the entity
resulting from such Business Combination or the combined voting power of the
then-outstanding voting securities of such entity, except to the extent that
the ownership in excess of twenty-five percent (25%) existed prior to the
Business Combination, and (3) a Change in Control is not triggered pursuant
to clause (ii) above with respect to the Company (including any successor
entity) or any Parent of the Company (or the successor entity).
	 
	 	(iv)	 	A complete liquidation or dissolution of the Company other than
in the context of a transaction that does not constitute a Change in Control of
the Company under clause (iii) above.






	 	 	 	Notwithstanding the foregoing, in no event shall a transaction or other event that
occurred prior to the Effective Date constitute a Change in Control. Notwithstanding
anything in clause (iii) above to the contrary, a change in ownership of the Company
resulting from creditors of the Company becoming stockholders of the Company in
connection with any bankruptcy of the Company under the laws of the United States
shall not trigger a Change in Control pursuant to clause (iii) above.
	 
	 	(g)	 	“Code” means the United States Internal Revenue Code of 1986, as amended.
	 
	 	(h)	 	“Committee” means the Compensation Committee of the Board, or any other
committee appointed by the Board to perform the functions of the Compensation
Committee.
	 
	 	(i)	 	“Company” means Northrop Grumman Corporation, a Delaware corporation
(including, for purposes of determining whether a Participant is employed by the





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	 	 	 	Company, any and all subsidiaries specified by the Committee), or any successor thereto
as provided in Article 10. Notwithstanding any other provision of this Plan to the
contrary, the term “Company” shall mean, for the following purposes, the
Company and any entity with respect to which the Company, directly or indirectly,
has majority voting control (the “NGC Group”): (i) with respect to determining a
Participant’s total Base Salary, bonus and other compensation; (ii) the Participant
shall not have a termination of employment, including a Qualifying Termination,
unless he or she is no longer employed by any member of the NGC Group (any transfer
of a Participant from one member of the NGC Group to another member of the NGC Group
shall not cause the Participant to cease being covered by this Plan); and (iii) with
respect to any reference to a benefit or compensation plan or program maintained by
the Company.






	 	(j)	 	“Controlling Parent” means the Company’s Parent so long as a majority of the
voting stock or voting power of that Parent is not Beneficially Owned, directly or
indirectly through one or more subsidiaries, by any other Person. In the event that the
Company has more than one “Parent,” then “Controlling Parent” shall mean the Parent of
the Company the majority of the voting stock or voting power of which is not
Beneficially Owned, directly or indirectly through one or more subsidiaries, by any
other Person.
	 
	 	(k)	 	“Disability” with respect to a particular Participant means disability as
defined in the Company’s long-term disability plan in which the Participant
participates at the relevant time or, if the Participant does not participate in a
Company long-term disability plan at the relevant time, as such term is defined in the
Company’s principal long-term disability plan that generally covers the Company’s
senior-level executives at that time.
	 
	 	(l)	 	“Effective Date” means January 1, 2010.
	 
	 	(m)	 	“Effective Date of Termination” means the date on which a Qualifying
Termination occurs.
	 
	 	(n)	 	‘“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	 	(o)	 	“Exchange Act” means the United States Securities Exchange Act of 1934, as
amended.
	 
	 	(p)	 	“Good Reason” means, without the Participant’s express written consent, the
occurrence of any one or more of the following:






	 	(i)	 	A material and substantial reduction in the nature or status of
the Participant’s authorities or responsibilities (when such authorities and/or
responsibilities are viewed in the aggregate) from their level in effect on the
day immediately prior to the start of the Protected Period, other than (A) an
inadvertent act that is remedied by the Company promptly after receipt of
notice thereof given by the Participant, and/or (B) changes in the




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	 	 	 	nature or
status of the Participant’s authorities or responsibilities that, in the
aggregate, would generally be viewed by a nationally-recognized executive
placement firm resulting in the participant having not materially
and substantially fewer authorities and responsibilities (taking into
consideration the Company’s industry) when compared to the authorities and
responsibilities applicable to the position held by the Participant
immediately prior to the start of the Protected Period. For the purpose of
the preceding test, the Participant and the Company shall mutually agree on
a nationally-recognized consulting firm; provided that, if agreement cannot
timely be reached, the Company and the Participant shall each timely choose
a nationally recognized firm and representatives of these two firms shall
promptly choose a third firm, which third firm will make the determination
referred to in the preceding sentence. The written opinion of the firm thus
selected may be admitted in any arbitration pursuant to Section 9.4 and
shall be conclusive as to this issue.
	 
	 	 	 	In addition, if the Participant is a vice president, the Participant’s loss
of vice-president status will constitute “Good Reason”; provided that the
loss of the title of “vice president” will not, in and of itself, constitute
Good Reason if the Participant’s lack of a vice president title is generally
consistent with the manner in which the title of vice president is used
within the Participant’s business unit or if the loss of the title is the
result of a promotion to a higher level office. For the purposes of the
preceding sentence, the Participant’s lack of a vice-president title will
only be considered generally consistent with the manner in which such title
is used if most persons in the business unit with authorities, duties, and
responsibilities comparable to those of the Participant immediately prior to
the commencement of the Protected Period do not have the title of
vice-president.






	 	(ii)	 	A reduction by the Company in the Participant’s Base Salary as
in effect on the Effective Date or as the same shall be increased from time to
time.
	 
	 	(iii)	 	A material reduction in the aggregate value of the
Participant’s level of participation in any of the Company’s short and/or
long-term incentive compensation plans (excluding stock-based incentive
compensation plans), employee benefit or retirement plans, or policies,
practices, or arrangements in which the Participant participates immediately
prior to the start of the Protected Period provided; however, that a reduction
in the aggregate value shall not be deemed to be “Good Reason” if the reduced
value remains substantially consistent with the average level of other
employees who have positions commensurate with the position held by the
Participant immediately prior to the start of the Protected Period.
	 
	 	(iv)	 	A material reduction in the Participant’s aggregate level of
participation in the Company’s stock-based incentive compensation plans from
the level in effect immediately prior to the start of the Protected Period;
provided,





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	 	 	 	however, that a reduction in the aggregate level of participation
shall not be deemed to be “Good Reason” if the reduced level of participation
remains substantially consistent with the average level of participation of
other employees who have positions commensurate with the position held by
the Participant immediately prior to the start of the Protected Period.






	 	(v)	 	The failure of the Company to obtain a satisfactory agreement
from any successor to the Company to assume and agree to perform this Plan, as
required in Article 10.
	 
	 	(vi)	 	Any purported termination by the Company of the Participant’s
employment that is not effected pursuant to a Notice of Termination satisfying
the requirements of Section 4.8 and for purposes of this Plan, no such
purported termination shall be effective.
	 
	 	(vii)	 	The Participant is informed by the Company that his or her
principal place of employment for the Company will be relocated to a location
that is greater than fifty (50) miles away from the Participant’s principal
place of employment for the Company at the start of the corresponding Protected
Period; provided that, if the Company communicates an intended effective date
for such relocation, in no event shall Good Reason exist pursuant to this
clause (vii) more than ninety (90) days before such intended effective date.
	 
	 	(viii)	 	The Company or any successor company repudiates or breaches any of the
provisions of this Plan.






	 	 	 	The Participant’s right to terminate employment for Good Reason shall not be
affected by the Participant’s incapacity due to physical or mental illness. The
Participant’s continued employment shall not constitute a consent to, or a waiver of
rights with respect to, any circumstances constituting Good Reason herein.
	 
	 	(q)	 	“Key Employee” means an employee treated as a “specified employee” as of his or
her Separation from Service under Code section 409A(a)(2)(B)(i) of the Company or its
affiliate (i.e., a key employee (as defined in Code section 416(i) without regard to
paragraph (5) thereof)) if the Company’s stock is publicly traded on an established
securities market or otherwise. The Company shall determine in accordance with a
uniform Company policy which individuals are Key Employees as of each December 31 in
accordance with IRS regulations or other guidance under Code section 409A, provided
that in determining the compensation of individuals for this purpose, the definition of
compensation in Treas. Reg. § 1.415(c)-2(d)(3) shall be used. Such determination shall
be effective for the twelve (12) month period commencing on April 1 of the following
year.
	 
	 	(r)	 	“Parent” means an entity that Beneficially Owns a majority of the voting stock
or voting power of the Company, or all or substantially all of the Company’s assets,
directly or indirectly through one or more subsidiaries.




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	 	(s)	 	“Participant” means an employee of the Company who fulfills the eligibility and
participation requirements, as provided in Article 3.
	 
	 	(t)	 	“Person” shall have the meaning ascribed 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) thereof.
	 
	 	(u)	 	“Plan” means this Northrop Grumman Corporation January 2010 Change In Control
Severance Plan.
	 
	 	(v)	 	“Qualifying Termination” has the meaning given to such term in Section 4.3(a).
	 
	 	(w)	 	“Separation from Service” or “Separate from Service” means a “separation from
service” within the meaning of Section 409A of the Code.
	 
	 	(x)	 	“Severance Benefits” means the payments and/or benefits provided in Section
4.4.





Article 3. Participation




     3.1 Eligible Employees. Individuals eligible to participate in this Plan shall include such
employees of the Company as may be determined by the Committee in its sole discretion.



     3.2 Participation. Subject to the terms of this Plan, the Committee or its delegate may, from
time to time select from all eligible employees those who shall participate in this Plan. The
Committee or its delegate also may, from time to time and by written notice to the affected
Participant(s), remove any previously selected Participant(s) from continued participation in this
Plan; provided that any removal of a Participant shall not be effective if it occurs after the
commencement of the Protected Period (as such term is defined in Section 4.3(b)).



Article 4. Severance Benefits




     4.1 Right to Severance Benefits. A Participant shall be entitled to receive from the Company
Severance Benefits, as described in Section 4.4, if the Participant has incurred a Qualifying
Termination.



     A Participant shall not be entitled to receive Severance Benefits if his or her employment
terminates (regardless of the reason) before the Protected Period (as such term is defined in
Section 4.3(b)) corresponding to a Change in Control of the Company or more than twenty-four (24)
months after the date of a Change in Control of the Company.



     4.2 Services During Certain Events. In the event a Person begins a tender or exchange offer,
circulates a proxy to stockholders of the Company, or takes other steps seeking to effect a Change
in Control, the Participant shall not voluntarily leave the employ of the Company and shall
continue to render services until the later of (i) the date such Person has abandoned or terminated
his or her or its efforts to effect a Change in Control, and (ii) the date that is six (6) months
after a Change in Control has occurred. Notwithstanding the foregoing, the Company may terminate
the Participant’s employment for Cause at any time, and the Participant may terminate his or her
employment at any time after the Change in Control for Good Reason.



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4.3 Qualifying Termination.





	 	(a)	 	Subject to Sections 4.3(c), 4.3(d), 4.5, 4.6 and 4.7, the occurrence of any one
or more of the following events within the Protected Period corresponding to a Change
in Control of the Company, or within twenty-four (24) calendar months following the
date of a Change in Control of the Company shall constitute a “Qualifying Termination”:






	 	(i)	 	An involuntary termination of the Participant’s employment by
the Company for reasons other than Cause; or
	 
	 	(ii)	 	A voluntary termination of employment by the Participant for
Good Reason.






	 	 	 	If more than one of the events set forth in this Section 4.3(a) occurs, such events
shall constitute but a single Qualifying Termination and the Participant shall be
entitled to but a single payment of the Severance Benefits.






	 	(b)	 	The “Protected Period” corresponding to a Change in Control of the Company
shall be a period of time determined in accordance with the following:






	 	(i)	 	If the Change in Control is triggered by a tender offer for
shares of the Company’s stock or by the offeror’s acquisition of shares
pursuant to such a tender offer, the Protected Period shall commence on the
date of the initial tender offer and shall continue through and including the
date of the Change in Control; provided that in no case will the Protected
Period commence earlier than the date that is six (6) months prior to the
Change in Control.
	 
	 	(ii)	 	If the Change in Control is triggered by a merger,
consolidation, or reorganization of the Company with or involving any other
corporation, the Protected Period shall commence on the date that serious and
substantial discussions first take place to effect the merger, consolidation,
or reorganization and shall continue through and including the date of the
Change in Control; provided that in no case will the Protected Period commence
earlier than the date that is six (6) months prior to the Change in Control.
	 
	 	(iii)	 	In the case of any Change in Control not described in clause
(i) or (ii) above, the Protected Period shall commence on the date that is six
(6) months prior to the Change in Control and shall continue through and
including the date of the Change in Control.






	 	(c)	 	Notwithstanding anything else contained herein to the contrary, a Participant’s
termination of employment on account of reaching mandatory retirement age, as such age
may be defined from time to time in policies adopted by the Company prior to the
commencement of the Protected Period, and consistent with applicable law, shall not be
a Qualifying Termination.




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	 	(d)	 	Notwithstanding anything else contained herein to the contrary, the termination
of a Participant’s employment (or other events giving rise to Good Reason) shall not
constitute a Qualifying Termination if there is objective evidence that, as of the
commencement of the Protected Period, the Participant had specifically been identified
by the Company as an employee whose employment would be terminated as part of a
corporate restructuring or downsizing program that commenced prior to the Protected
Period and such termination of employment was expected at that time to occur within six
(6) months.
	 
	 	(e)	 	Notwithstanding anything else contained herein to the contrary (other than
those provisions that contain an express exception to this Section 4.3(e)), a
Participant’s Severance Benefits under this Plan shall be reduced by the severance
benefits (including, without limitation, any other change in control severance benefits
and any other severance benefits generally) that the Participant may be entitled to
under any other plan, program, agreement or other arrangement with the Company
(including, without limitation, any such benefits provided for by an employment
agreement, a current or any prior Northrop Grumman Corporation Special Agreement, a
current or any prior Severance Plan for Elected and Appointed Officers of Northrop
Grumman Corporation, or under any predecessor Northrop Grumman Corporation
Change-In-Control Severance Plan); provided that (i) if the Participant is otherwise
entitled to receive Severance Benefits under this Plan and under a Northrop Grumman
Corporation Special Agreement (version January 2010 or later), benefits shall be paid
under the Northrop Grumman Corporation Special Agreement rather than under this Plan
and (ii) if the Participant is otherwise entitled to receive Severance Benefits under
this Plan and severance benefits under the Severance Plan for Elected and Appointed
Officers of Northrop Grumman Corporation (version October 2009 or later), benefits
shall be paid under this Plan rather than under such plan. For purposes of the
foregoing, any cash severance benefits payable to the Participant under any other plan,
program, agreement or other arrangement with the Company shall offset the cash
severance benefits otherwise payable to the Participant under this Plan on a
dollar-for-dollar basis. For purposes of the foregoing, non-cash severance benefits to
be provided to the Participant under any other plan, program, agreement or other
arrangement with the Company shall offset any corresponding benefits otherwise to be
provided to the Participant under this Plan or, if there are no corresponding benefits
otherwise to be provided to the Participant under this Plan, the value of such benefits
shall offset the cash severance benefits otherwise payable to the Participant under
this Plan on a dollar-for-dollar basis. If the amount of other benefits to be offset
against the cash severance benefits otherwise payable to the Participant under this
Plan in accordance with the preceding two sentences exceeds the amount of cash
severance benefits otherwise payable to the Participant under this Plan, then the
excess may be used to offset other non-cash severance benefits otherwise to be provided
to the Participant under this Plan on a dollar-for-dollar basis. For purposes of this
Section 4.3(e), the Company shall reasonably determine the value of any non-cash
benefits.






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     4.4 Description of Severance Benefits. In the event that a Participant becomes entitled
to receive Severance Benefits, as provided in Sections 4.1 and 4.3, the Company shall pay to the
Participant and provide him or her with the following:




	 	(a)	 	An amount equal to two (2) times the highest rate of the Participant’s
annualized Base Salary in effect at any time in the two (2) year period ending on the
Effective Date of Termination.
	 
	 	(b)	 	An amount equal to two (2) times the Participant’s target annual bonus
established under the Company’s Annual Incentive Plan (or any successor bonus program)
for the fiscal year in which the Change in Control of the Company occurs (the “Bonus
Amount”). Special bonuses or bonus enhancements that would otherwise be included for
purposes of the calculation pursuant to the first sentence of this Section 4.4(b), but
that are related to a merger, acquisition, consolidation, reorganization, spin-off or
similar event and that are not part of the Company’s customary on-going program of
Annual Incentive Plan (or any successor bonus program) bonuses shall be excluded for
purposes of such calculation.
	 
	 	(c)	 	An amount in settlement of the Participant’s bonus opportunity under the
Company’s Annual Incentive Plan (or a successor bonus program) for the fiscal year in
which the Effective Date of Termination occurs, such amount determined as follows:






	 	(i)	 	Subject to clause (iii) below, if the Effective Date of
Termination occurs in the fiscal year in which the Change in Control of the
Company occurs, then such amount shall equal the sum of:






	 	(A)	 	the greater of (X) or (Y) multiplied by a
fraction, the numerator of which is the number of days completed in the
fiscal year through the date of the Change in Control of the Company
and the denominator of which is three hundred sixty-five (365), where
(X) is the Participant’s target annual bonus established under the
Company’s Annual Incentive Plan (or any successor bonus program) for
that fiscal year and (Y) is the amount of bonus that the Participant
would be entitled to under the Company’s Annual Incentive Plan (or any
successor bonus program) for that fiscal year assuming that the
Participant’s employment had not terminated and based on performance
through the date of the Change in Control of the Company relative to
the pre-approved performance goals for that year; plus
	 
	 	(B)	 	the Participant’s Bonus Amount multiplied by a
fraction, the numerator of which is the number of days completed in the
fiscal year following the date of the Change in Control of the Company
through the Effective Date of Termination and the denominator of which
is three hundred sixty-five (365).




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	 	(ii)	 	Subject to clause (iii) below, if the Effective Date of
Termination occurs in a fiscal year following the fiscal year in which the
Change in Control of the Company occurs, then such amount shall equal the
Participant’s Bonus Amount multiplied by a fraction, the numerator of which is
the number of days completed in the fiscal year in which the Effective Date of
Termination occurs through the Effective Date of Termination and the
denominator of which is three hundred sixty-five (365).
	 
	 	(iii)	 	If the Participant’s bonus opportunity for the fiscal year in
which the Effective Date of Termination occurs is covered by the Company’s
Incentive Compensation Plan (or similar successor bonus program designed to
comply with the performance-based compensation exception under Section 162(m)
of the Code), then the Participant’s amount determined pursuant to clause (i)
or (ii) above, as applicable, shall not exceed the maximum bonus the
Participant would have been entitled to receive under the Company’s Incentive
Compensation Plan for that fiscal year, assuming the Participant had been
employed through the date bonuses are paid under such plan for that year, and
otherwise calculated under the terms of such plan based on actual performance
for that fiscal year (but without giving effect to any discretion of the plan
administrator to reduce the bonus amount from the maximum otherwise determined
in accordance with such plan).






	 	(d)	 	A continuation of the Participant’s medical coverage, dental coverage, and
group term life insurance (the “Welfare Benefits”) for the Participant, his or her
spouse, and his or her eligible dependents for the two (2) years following the
Participant’s Effective Date of Termination; provided that such continuation of
coverage shall run concurrently with COBRA continuation or similar state law
continuation periods; and provided further that the continuation of such coverage shall
be discontinued prior to the end of the two (2) year period in the event the
Participant has available substantially similar benefits from a subsequent employer, as
reasonably determined by the Committee. Except as provided in the next sentence, such
benefits shall be provided to the Participant at the same premium cost, and at the same
coverage level, as in effect as of the Participant’s Effective Date of Termination.
However, in the event the premium cost and/or level of coverage shall change for all
employees of the Company, the cost and/or coverage level, likewise, shall change for
each Participant in a corresponding manner. The continuation of coverage for the period
contemplated by this Section 4.4(d) shall be coordinated with and paid secondary to any
benefits that the Participant, his or her spouse, or his or her dependent receives from
another employer or from Medicare (following the Participant’s, his or her spouse’s,
and/or his or her dependent’s entitlement to Medicare benefits) to the maximum extent
permissible under relevant law. Notwithstanding the foregoing provisions of this
Section 4.4(d), if the Participant is eligible to commence benefits under the Company’s
Special Officer Retiree Medical Plan (“SORMP”) as of the Effective Date of Termination,
then the Participant shall receive medical and dental continuation coverage pursuant to
the SORMP instead of the continuation




13









 






	 	 	 	coverage contemplated by the foregoing provisions of this Section 4.4(d). Any other
continuation of medical, dental, or group term life insurance that the Participant
may otherwise be entitled to upon or following his or her Effective Date of
Termination in accordance with the express terms of a Company welfare benefit plan
shall not give rise to an offset pursuant to Section 4.3(e) and shall not be deemed
to duplicate the benefits of the continuation coverage contemplated by this Section
4.4(d).






	 	 	 	The Welfare Benefits provided pursuant to this Section 4.4(d) shall, to the maximum
extent possible, be provided in such a manner that results in such Welfare Benefits
(and any costs and premiums thereof) being excluded from the Participant’s income
for federal and state income tax purposes.
	 
	 	 	 	However, to the extent the Welfare Benefits provided pursuant to this Section 4.4(d)
are, or ever become, taxable to the Participant and to the extent the Welfare
Benefits continue beyond the period in which the Participant would be entitled (or
would, but for this Plan, be entitled) to COBRA continuation coverage if the
Participant elected such coverage and paid the applicable premiums, the Company
shall administer such provision of Welfare Benefits consistent with the following
additional requirements as set forth in Treas. Reg. § 1.409A-3(i)(1)(iv): (A) the
Participant’s eligibility for Welfare Benefits in one year will not affect the
Participant’s eligibility for Welfare Benefits in any other year, (B) any
reimbursement of eligible expenses will be made on or before the last day of the
year following the year in which the expense was incurred, and (C) the Participant’s
right to Welfare Benefits is not subject to liquidation or exchange for another
benefit.
	 
	 	(e)	 	A lump-sum cash amount equal to (i) minus (ii), with (i) and (ii) determined as
follows:






	 	(i)	 	equals the actuarial present value equivalent of the aggregate
benefits accrued by the Participant as of his or her Effective Date of
Termination under the qualified defined benefit pension plan or plans in which
the Participant participates (the “qualified plan”), and under any and all
supplemental defined benefit retirement plans in which the Participant
participates, calculated as if the Participant’s employment continued for two
(2) full years following the Participant’s Effective Date of Termination (i.e.,
the Participant receives two (2) additional years of vesting and benefit
accruals, including, in the case of a Participant in a cash balance plan, two
years of projected post-termination interest credits based on the interest rate
in effect at termination, and his or her age is also increased two (2) years
from his or her age as of his or her Effective Date of Termination); provided,
however, that for purposes of determining “Final Average Pay” under such plans,
the Participant’s actual pay history as of the Effective Date of Termination
shall be used; and




14









 






	 	(ii)	 	equals the actuarial present value equivalent of the aggregate
benefits payable to the Participant as of his or her Effective Date of
Termination under the qualified plan and under any and all supplemental defined
benefit retirement plans in which the Participant participates, calculated
assuming that the Participant retired and went into pay status under the terms
of such plans on or as soon as possible after his or her Effective Date of
Termination.






	 	 	 	The intent of this Section 4.4(e) is that the qualified plan and any supplemental
defined benefit retirement plan benefits will be paid in the normal course under the
terms of those plans, with the additional benefits payable as a result of the
imputation of age and service under this provision being paid from this Plan. The
Participant shall also be entitled to an additional two (2) years of age and service
to count towards eligibility under one or more of the Company retiree medical
programs for which the Participant would have been eligible absent any such
termination.
	 
	 	(f)	 	Reimbursement by the Company for the costs of all reasonable outplacement
services obtained by the Participant within the one (1) year period after the Effective
Date of Termination; provided, however, that the total reimbursement shall be limited
to an amount equal to fifteen percent (15%) of the Participant’s Base Salary as of the
Effective Date of Termination. All such expenses shall be reimbursed as soon as
practicable, but in no event later than the end of the year following the year the
Participant Separates from Service.





     4.5 Termination for Total and Permanent Disability. Termination of a Participant’s employment
due to Disability is not a Qualifying Termination. However, if immediately prior to the condition
or event leading to, or the commencement of, the Disability of the Participant, the Participant
would have experienced a Qualifying Termination if he or she had terminated at that time, then upon
termination of his or her employment for Disability he or she shall be entitled to the benefits
provided by this Plan for a Qualifying Termination.



     4.6 Termination for Retirement or Death. Termination of a Participant’s employment due to
retirement or death is not a Qualifying Termination. However, if immediately prior to the
Participant’s retirement (but not death), the Participant would have experienced a Qualifying
Termination if he or she had terminated at that time, then upon his or her retirement he or she
shall (subject to Section 4.3(c)) be entitled to the benefits provided by this Plan for a
Qualifying Termination.



     4.7 Termination for Cause or by a Participant Other Than for Good Reason. Termination of a
Participant’s employment by the Company for Cause or by the Participant other than for Good Reason
does not constitute a Qualifying Termination.



     4.8 Notice of Termination. Any termination by the Company for Cause or by a Participant for
Good Reason shall be communicated by a Notice of Termination. For purposes of this Plan, a “Notice
of Termination” shall mean a written notice which shall indicate the specific termination provision
in this Plan relied upon, and shall set forth in reasonable detail the facts



15









 




and circumstances claimed to provide a basis for termination of the Participant’s employment
under the provision so indicated.





			
	Article 5.	 	Form and Timing of Severance Benefits; Tax Withholding; Funding of Rabbi Trust





     5.1 Form and Timing of Severance Benefits. The Severance Benefits described in Section
4.4(a), 4.4(b), and 4.4(e) shall be paid in cash to the Participant in a single lump sum as soon as
practicable following the Participant’s Separation from Service, but in no event beyond thirty (30)
days from such date. Notwithstanding the foregoing, if the Participant is a Key Employee, the lump
sum payment shall be made on or within thirty (30) days after the first day of the seventh month
following the Participant’s Separation from Service (or, if earlier, the first day of the month
after the Participant’s death). The Severance Benefit described in Section 4.4(c) shall be paid in
a single lump sum in the year following the year in which the Participant’s Separation from Service
occurs; provided that if the Participant is a Key Employee, such payment shall be made no earlier
than six months after the Participant’s Separation from Service (or, if earlier, the date of the
Participant’s death).



     5.2 Withholding of Taxes. The Company shall be entitled to withhold from any amounts payable
under or pursuant to this Plan all taxes as legally shall be required (including, without
limitation, any United States Federal taxes, and any other state, city, or local taxes).



     5.3 Funding of Rabbi Trust. To the extent the Company is obligated to make a contribution to
any rabbi trust, pursuant to the express terms of such trust, upon or with respect to a Protected
Period or the occurrence of a Change in Control, the Company shall make such required contribution
in accordance with the terms of such trust.




			
	Article 6.	 	Excise Tax Limitation





     Notwithstanding anything contained in this Plan to the contrary, if upon or following a Change
in Control, the tax imposed by Section 4999 of the Code or any similar or successor tax (the
“Excise Tax”) applies, solely because of the Change in Control, to any payments, benefits and/or
amounts received by the Participant as Severance Benefits or otherwise, including, without
limitation, any fees, costs and expenses paid under Article 9 of this Plan and/or any amounts
received or deemed received, within the meaning of any provision of the Code, by the Participant as
a result of (and not by way of limitation) any automatic vesting, lapse of restrictions and/or
accelerated target or performance achievement provisions, or otherwise, applicable to outstanding
grants or awards to the Participant under any of the Company’s incentive plans, including without
limitation, the 2001 Long-Term Incentive Stock Plan and the 1993 Long Term Incentive Stock Plan
(collectively, the “Total Payments”), then the Total Payments shall be reduced (but not below zero)
so that the maximum amount of the Total Payments (after reduction) shall be one dollar ($1.00) less
than the amount which would cause the Total Payments to be subject to the Excise Tax; provided that
such reduction to the Total Payments shall be made only if the total after-tax benefit to the
Participant is greater after giving effect to such reduction than if no such reduction had been
made. If such a reduction is required, the Company shall reduce or eliminate the Total Payments by
first reducing or eliminating any cash severance benefits, then by reducing or eliminating any
accelerated vesting of stock options,



16









 




then by reducing or eliminating any accelerated vesting of other equity awards, then by
reducing or eliminating any other remaining Total Payments, in each case in reverse order beginning
with the payments which are to be paid the farthest in time from the Change in Control. The
preceding provisions of this Article 6 shall take precedence over the provisions of any other plan,
arrangement or agreement governing the Participant’s rights and entitlements to any benefits or
compensation.





			
	Article 7.	 	The Company’s Payment Obligation





     7.1 Payment of Obligations Absolute. Except as provided in Sections 4.3(e) and 5.2 and in
Article 6, the Company’s obligation to make the payments and the arrangements provided for herein
shall be absolute and unconditional, and shall 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 or anyone else. All amounts payable by the Company hereunder shall
be paid without notice or demand. Each and every payment made hereunder by the Company shall be
final, and the Company shall not seek to recover all or any part of such payment from the
Participant or from whomsoever may be entitled thereto, for any reasons whatsoever, except as
otherwise provided in Article 6 or Article 9; provided that this Section does not preclude the
Company from pursuing causes of action that it otherwise might have against the Participant.



     Participants shall not be obligated to seek other employment in mitigation of the amounts
payable or arrangements made under any provision of this Plan, and the obtaining of any such other
employment shall in no event effect any reduction of the Company’s obligations to make the payments
and arrangements required to be made under this Plan, except to the extent provided in Section
4.4(d).



     7.2 Contractual Right to Benefits. This Plan establishes and vests in each Participant a
contractual right to the benefits to which he or she is entitled hereunder. The Company expressly
waives any ability, if possible, to deny liability for any breach of its contractual commitment
hereunder upon the grounds of lack of consideration, accord and satisfaction or any other defense.
In any dispute arising after a Change in Control as to whether the Participant is entitled to
benefits under this Plan, there shall be a presumption that the Participant is entitled to such
benefits and the burden of proving otherwise shall be on the Company. However, nothing herein
contained shall require or be deemed to require, or prohibit or be deemed to prohibit, the Company
to segregate, earmark, or otherwise set aside any funds or other assets, in trust or otherwise, to
provide for any payments to be made or required hereunder.



     7.3 Pension Plans; Duplicate Benefits. All payments, benefits and amounts provided under this
Plan shall be in addition to and not in substitution for any pension rights under the Company’s
tax-qualified pension plan, supplemental retirement plans, nonqualified deferred compensation
plans, and any disability, workers’ compensation or other Company benefit plan distribution that a
Participant is entitled to at his or her Effective Date of Termination. Notwithstanding the
foregoing, this Plan shall not create an inference that any duplicate payments shall be required.
No payments made pursuant to this Plan shall be considered compensation for purposes of any such
benefit plan; provided that any amount paid pursuant to Section 4.4(c) shall not be subject to such
limitation. Payment of a Participant’s



17









 




accrued and unpaid Base Salary and accrued vacation pay through the Participant’s Effective
Date of Termination shall be deemed to not duplicate any benefit contemplated by this Plan and
shall not result in an offset pursuant to Section 4.3(e). Any acceleration of vesting, lapse of
restrictions and/or payout occasioned by a Change in Control pursuant to the provisions of any
long-term incentive plan and/or individual award agreement under such a long-term incentive plan
shall be deemed to not duplicate any benefit contemplated by this Plan and shall not result in an
offset pursuant to Section 4.3(e).





			
	Article 8.	 	Trade Secrets; Non-Solicitation and Non-Disparagement





     By accepting participation in this Plan and again by receiving any benefits provided for by
this Plan, each Participant shall be deemed to, and does, agree as follows:




	 	(a)	 	In the course of performing his or her duties for the Company, the Participant
will receive, and acknowledges that he or she has received, confidential information,
including without limitation, information not available to competitors relating to the
Company’s existing and contemplated financial plans, products, business plans,
operating plans, research and development information, and customer information, all of
which is hereinafter referred to as “Trade Secrets.” The Participant agrees that he or
she will not, either during his or her employment or subsequent to the termination of
his or her employment with the Company, directly or indirectly disclose, publish or
otherwise divulge any Trade Secret of the Company or any of its affiliates to anyone
outside the Company, or use such information in any manner which would adversely affect
the business or business prospects of the Company, without prior written authorization
from the Company to do so. The Participant further agrees that if, at the time of the
termination of his or her employment with the Company, he or she is in possession of
any documents or other written or electronic materials constituting, containing or
reflecting Trade Secrets, the Participant will return and surrender all such documents
and materials to the Company upon leaving its employ. The restrictions and protection
provided for in this Section 8(a) shall be in addition to any protection afforded to
Trade Secrets by law or equity and in addition to any protection afforded to Trade
Secrets by any other agreement between the Participant and the Company.
	 
	 	(b)	 	For a period of one year following the termination of the Participant’s
employment with the Company, the Participant shall not, directly or indirectly through
aid, assistance or counsel, on the Participant’s own behalf or on behalf of another
person or entity (i) contact, solicit or offer to hire any person who was, within a
period of six months prior to the termination of the Participant’s employment with the
Company, employed by the Company or one of its subsidiaries, or (ii) by any means issue
or communicate any private or public statement that may be critical or disparaging of
the Company or any of its affiliates, or any of their respective products, services,
officers, directors or employees.




18









 












			
	Article 9.	 	Claims Procedures





     9.1 Committee Review. Any Participant or Beneficiary of a deceased Participant (such
Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Committee a
written claim for a determination with respect to the amounts distributable to such Claimant from
this Plan. Such claim shall be delivered to the Committee in care of the Company in accordance with
the notice provisions of Section 11.5. If such a claim relates to the contents of a notice received
by the Claimant, the claim must be made within sixty (60) days after such notice was received by
the Claimant. All other claims must be made within two hundred and seventy (270) days of the date
on which the event that caused the claim to arise occurred. The claim must state with particularity
the determination desired by the Claimant.



     9.2 Notification of Decision. The Committee shall consider a Claimant’s claim pursuant to
Section 9.1 within a reasonable time, but no later than ninety (90) days after receiving the claim.
If the Committee determines that special circumstances require an extension of time for processing
the claim, written notice of the extension shall be furnished to the Claimant prior to the
termination of the initial ninety (90) day period. In no event shall such extension exceed a period
of ninety (90) days from the end of the initial period. The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the Committee expects to
render the benefit determination. The Committee shall notify the Claimant in writing:




	 	(a)	 	that the Claimant’s requested determination has been made, and that the claim
has been allowed in full; or
	 
	 	(b)	 	that the Committee has reached a conclusion contrary, in whole or in part, to
the Claimant’s requested determination, and such notice must set forth in a manner
calculated to be understood by the Claimant:






	 	(i)	 	the specific reason(s) for the denial of the claim, or any part
of it;
	 
	 	(ii)	 	specific reference(s) to pertinent provisions of this Plan upon
which such denial was based;
	 
	 	(iii)	 	a description of any additional material or information
necessary for the Claimant to perfect the claim, and an explanation of why such
material or information is necessary;
	 
	 	(iv)	 	a statement that the Claimant is entitled to receive, upon
request and free of charge, reasonable access to and copies of, all documents,
records and other information relevant (as defined in applicable ERISA
regulations) to the Claimant’s claim for benefits; and
	 
	 	(v)	 	a statement of the Claimant’s right to seek arbitration
pursuant to Section 9.4.





     9.3 Pre and Post-Change in Control Procedures. With respect to claims made prior to the
occurrence of a Change in Control, a Claimant’s compliance with the foregoing



19









 




provisions of this Article 9 is a mandatory prerequisite to a Claimant’s right to commence
arbitration pursuant to Section 9.4 with respect to any claim for benefits under this Plan. With
respect to claims made upon and after the occurrence of a Change in Control, the Claimant may
proceed directly to arbitration in accordance with Section 9.4 and need not first satisfy the
foregoing provisions of this Article 9.




     9.4 Arbitration of Claims. All claims or controversies arising out of or in connection with
this Plan, that the Company may have against any Claimant, or that any Claimant may have against
the Company or against its officers, directors, employees or agents acting in their capacity as
such, shall, subject to the initial review provided for in the foregoing provisions of this Article
9 that are effective with respect to claims brought prior to the occurrence of a Change in Control,
be resolved through arbitration as provided in this Section 9.4. The decision of an arbitrator on
any issue, dispute, claim or controversy submitted for arbitration, shall be final and binding upon
the Company and the Claimant and that judgment may be entered on the award of the arbitrator in any
court having proper jurisdiction. The arbitrator shall review de novo any claim previously
considered by the Committee pursuant to Section 9.1.



     All expenses of such arbitration, including the fees and expenses of the counsel for the
Participant, shall be advanced and borne by the Company; provided, however, that if it is finally
determined that the Claimant did not commence the arbitration in good faith and had no reasonable
basis therefore, the Claimant shall repay all advanced fees and expenses and shall reimburse the
Company for its reasonable legal fees and expenses in connection therewith.



     Except as otherwise provided in this procedure or by mutual agreement of the parties, any
arbitration shall be administered: (1) in accordance with the then-current Model Employment
Arbitration Procedures of the American Arbitration Association (“AAA”) before an arbitrator who is
licensed to practice law in the state in which the arbitration is convened; or (2) if locally
available, the Judicial Arbitration & Mediation Services, Inc. (“JAMS”), in accordance with the
JAMS procedures then in effect. The party who did not initiate the claim can designate between JAMS
or AAA (the “Tribunal”). The arbitration shall be held in the city in which the Claimant is or was
last employed by the Company in the nearest Tribunal office or at a mutually agreeable location.
Pre-hearing and post-hearing procedures may be held by telephone or in person as the arbitrator
deems necessary.



     The arbitrator shall be selected as follows: if the parties cannot agree on an arbitrator, the
Tribunal (JAMS or AAA) shall then provide the names of nine (9) available arbitrators experienced
in business employment matters along with their resumes and fee schedules. Each party may strike
all names on the list it deems unacceptable. If more than one common name remains on the list of
all parties, the parties shall strike names alternately until only one remains. The party who did
not initiate the claim shall strike first. If no common name remains on the lists of the parties,
the Tribunal shall furnish an additional list or lists until an arbitrator is selected.



     The arbitrator shall interpret this Plan, any applicable Company policy or rules and
regulations, any applicable substantive law (and the law of remedies, if applicable) of the state
in which the claim arose, or applicable federal law. In reaching his or her decision, the
arbitrator shall have no authority to change or modify any lawful Company policy, rule or
regulation, or



20









 




this Plan. The arbitrator, and not any federal, state or local court or agency, shall have
exclusive and broad authority to resolve any dispute relating to the interpretation, applicability,
enforceability or formation of this Plan, including but not limited to, any claim that all or any
part of this Plan is voidable.




     The arbitrator shall have authority to entertain a motion to dismiss and/or motion for summary
judgment by any party and shall apply the standards governing such motions under the Federal Rules
of Civil Procedure.



     Each party shall have the right to take the deposition of one individual and any expert
witness(es) designated by another party. Each party shall also have the opportunity to obtain
documents from another party through one request for production of documents. Additional discovery
may be had only when the arbitrator so orders upon a showing of substantial need. Any disputes
regarding depositions, requests for production of documents or other discovery shall be submitted
to the arbitrator for determination.



     Each party shall have the right to subpoena witnesses and documents for the arbitration
hearing by requesting a subpoena from the arbitrator. Any such request shall be served on all other
parties, who shall advise the arbitrator in writing of any objections that the party may have to
issuance of the subpoena within ten (10) calendar days of receipt of the request.



     At least thirty (30) calendar days before the arbitration, the parties must exchange lists of
witnesses, including any expert(s), and copies of all exhibits intended to be used at the
arbitration.




			
	Article 10.	 	Successors and Assignment





     10.1 Successors to the Company. The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) of all or substantially all of the
business and/or assets of the Company or of any division or subsidiary thereof (the business and/or
assets of which constitute at least fifty percent (50%) of the total business and/or assets of the
Company) to expressly assume and agree to perform the Company’s obligations under this Plan in the
same manner and to the same extent that the Company would be required to perform them if such
succession had not taken place.



     10.2 Assignment by the Participant. This Plan shall inure to the benefit of and be
enforceable by each Participant’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, and legatees. If a Participant dies while any amount
would still be payable to him or her hereunder had he or she continued to live, all such amounts,
unless otherwise provided herein, shall be paid to the Participant’s Beneficiary in accordance with
the terms of this Plan.




			
	Article 11.	 	Miscellaneous





     11.1 Employment Status. Except as may be provided under any other written agreement between a
Participant and the Company, the employment of the Participant by the Company is “at will,” and,
prior to the effective date of a Change in Control, may be terminated by either the Participant or
the Company at any time, subject to applicable law.



21









 





     11.2 Gender and Number. Except where otherwise indicated by the context, any masculine term
used herein also shall include the feminine, the plural shall include the singular, and the
singular shall include the plural.



     11.3 Severability. In the event that any provision of this Plan shall be held illegal or
invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this
Plan, and this Plan shall be construed and enforced as if the illegal or invalid provision had not
been included. Further, the captions of this Plan are not part of the provisions hereof and shall
have no force and effect.



     11.4 Modification. No provision of this Plan may be modified, waived, or discharged unless as
to a Participant such modification, waiver, or discharge is agreed to in writing and signed by each
affected Participant and by an authorized member of the Committee or its designee, or by the
respective parties’ legal representatives and successors.



     11.5 Notice. For purposes of this Plan, notices, including a Notice of Termination, and all
other communications provided for in this Plan shall be in writing and shall be deemed to have been
duly given when delivered or on the date stamped as received by the U.S. Postal Service for
delivery by certified or registered mail, postage prepaid and addressed: (i) if to the Participant,
to his or her latest address as reflected on the records of the Company, and (ii) if to the
Company: Northrop Grumman Corporation, 1840 Century Park East, Los Angeles, California 90067, Attn:
Chief Human Resources Officer, or to such other address as the Company may furnish to the
Participant in writing with specific reference to this Plan and the importance of the notice,
except that notice of change of address shall be effective only upon receipt.



     11.6 Applicable Law. To the extent not preempted by the laws of the United States, the laws
of the State of California shall be the controlling law in all matters relating to this Plan. Any
statutory reference in this Plan shall also be deemed to refer to all applicable final rules and
final regulations promulgated under or with respect to the referenced statutory provision.




22