Exhibit 10.14


 


THE SHERIDAN GROUP, INC.


 


Change-of-Control Incentive Plan


 


Key Management Employees


 


The Sheridan Group, Inc. (the “Company”) proposes to
adopt this Change-of-Control Incentive Plan (the “Plan”) for its key management
employees, providing for payment of the Severance Benefits described below in
the event of certain terminations of employment following a change of
control.  Any acquiror will be required
to assume the Plan.


 


Severance
Benefits:  During the period of eighteen (18) months
following a Change of Control, each Covered Employee will be entitled to
payment by the Successor Employer of Severance Compensation following any
termination of such Covered Employee’s employment as a result of (a) such
Covered Employee’s termination of his or her employment for Good Reason or (b)
the Successor Employer’s termination of such Covered Employee’s employment
without Cause.


 


Defined
Terms:


 


“Applicable
Period” means
eighteen (18) months.


 


“Board” means the Board of Directors of the
Successor Employer.


 


“Cause” means:


 


(i)            the Covered Employee shall have
committed an act of fraud, embezzlement or misappropriation against the
Successor Employer, including, but not limited to, the offer, payment,
solicitation or acceptance of any unlawful bribe or kickback with respect to
the Successor Employer’s business; or


 


(ii)           the Covered Employee shall have been
convicted by a court of competent jurisdiction of, or pleaded guilty or nolo
contendere to, any felony or any crime involving moral turpitude; or


 


(iii)          the Covered Employee shall have
refused, after explicit written notice, to obey any lawful resolution of or
direction by the Board which is consistent with the duties incident to his or
her employment; or


 


 

















 


 


(iv)          the Covered Employee shall have been
chronically absent from work (excluding vacations, illnesses or leaves of
absence approved by the Board); or


 


(v)           the Covered Employee shall have
failed to perform the duties incident to his or her employment with the
Successor Employer on a regular basis, and such failure shall have
continued for a period of twenty (20) days after written notice to the Covered
Employee specifying such failure in reasonable detail (other than as a result
of the Covered Employee’s Disability); or


 


(vi)          the Covered Employee shall have
engaged in the unlawful use (including being under the influence) or possession
of illegal drugs on the Successor Employer’s premises.


 


“Change
of Control” means
(i) the sale or other transfer of all or substantially all of the assets of the
Company or its subsidiaries in a single transaction or series of related
transactions, (ii) the merger or consolidation of the Company with any other
entity, a majority of whose voting securities are owned by any persons or
persons other than the holders of a majority of the currently-outstanding
voting securities of the Company, and (iii) the sale or other transfer of a
majority of the outstanding voting securities of the Company in a single
transaction or series of related transactions.


 


“Covered Employees” means the following employees of the Company or any
of its subsidiaries, so long as they are so employed at the time of the closing
of a Change of Control:


 


Robert M. Jakobe


William P. Walters


Patricia A. Stricker


Douglas R. Ehmann


Robert M. Moore


Gary J. Kittredge


David C. Hewitt


J. Kenneth Garner


 


“Disability” means that an independent medical doctor
(selected by the Successor Employer’s health or disability insurer) shall have
certified that the Covered Employee has for 180 days, consecutive or
non-consecutive, in any twelve (12) month period been physically or mentally
disabled in a manner which seriously interferes with his or her ability to
perform the duties incident to his or her employment.  Any refusal by a Covered 


 


 


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Employee to submit to a medical examination for the
purpose of certifying Disability shall be deemed to constitute conclusive
evidence of such Covered Employee’s Disability.


 


“Good
Reason” means the
occurrence of any of the events or conditions described in subparagraphs (i) -
(iv) of this definition, without the Covered Employee’s express written
consent, which is not corrected within twenty (20) days after delivery by the
Covered Employee of written notice thereof to the Successor Employer:


 


                (i)            a
material reduction in the Covered Employee’s status, title, position, scope of
authority or responsibilities, or the assignment to the Covered Employee of any
duties or responsibilities which are materially inconsistent with such status,
title, position, authority or responsibilities;


 


(ii)           involuntary relocation of the Covered
Employee;


 


(iii)          any removal of the Covered Employee
from or failure to reappoint him or her to any of his or her positions held on
the date of the Change of Control, except in connection with the termination of
his or her employment by the Successor Employer for Cause or by the Covered
Employee other than for Good Reason, or as a result of the Covered Employee’s
death or Disability; or


 


                (iv)          a
material reduction by the Successor Employer in the Covered Employee’s
compensation or benefits as in effect on the date of the Change of Control.


 


“Incentive
Bonuses” means
any management incentive bonus paid to a Covered Employee, in accordance with
an incentive bonus plan adopted by the Board or maintained by the Company and
its subsidiaries, but excluding any “Retention Bonus” or other similar amount
payable into such Covered Employee’s Deferred Compensation Plan.


 


“Severance
Compensation”
means:


 


(i)            severance payments, in accordance
with the Successor Employer’s then current payroll practices, at an annual rate
equal to the sum of (1) the Covered Employee’s base salary in effect on the
date of the Change of Control plus (2) the average of the Incentive
Bonuses earned by the Covered Employee for the two fiscal years immediately
preceding the date of his or her termination of employment, for the Applicable
Period;


 


 


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(ii)           continued coverage during the
Applicable Period under the health insurance plan maintained by the Successor
Employer for its full-time, salaried employees;


 


(iii)          payment of any expense reimbursements
for expenses incurred in the performance of the Covered Employees’ duties prior
to termination of his or her employment; and


 


(iv)          immediate vesting (to the extent not
previously vested) of the Covered Employee’s deferred compensation account in
accordance with the Company’s Deferred Compensation Plan.


 


“Successor
Employer” means
the entity continuing the business of the Company and its subsidiaries, or a
part thereof, and employing the Covered Employee following a Change of Control.


 


Other
Terms:


 


At Will
Employment:  Each of the Covered Employees is an at-will
employee of the Company or one of its subsidiaries, and his or her employment
may be terminated at any time by such Covered Employee’s or by his or her
employer’s giving the other party written notice of termination.  Nothing contained in this Plan is intended
to create for any of the Covered Employees any right to continued employment
with the Company, any of its subsidiaries, or any Successor Employer, or
employment in the same position or on the same terms as those currently in
effect.


 


Arbitration of Disputes:  Any controversy or claim between any Covered
Employee and a Successor Employer arising out of or relating to this Plan or
the breach thereof shall, to the extent permitted by law, be settled by
arbitration in any forum and form agreed upon by the Covered Employee and the
Successor Employer, or in the absence of such an agreement, under the auspices
of the American Arbitration Association (“AAA”) in Baltimore, Maryland in
accordance with the Employment Dispute Resolution Rules of the AAA, including,
but not limited to, the rules and procedures applicable to the selection of
arbitrators, except that the Successor Employer shall pay all administrative
fees and arbitrator’s fees and expenses related to such arbitration.  Notwithstanding the foregoing, this
provision shall not preclude any party from pursuing a court action for the
sole purpose of obtaining a temporary restraining order or a preliminary
injunction in circumstances in which such relief is appropriate, provided that
any other relief shall be pursued through an arbitration proceeding as provided
herein.


 


 


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Severability:  If any provision of this Plan is or becomes
invalid, illegal or unenforceable in any respect under any law, the validity,
legality and enforceability of the remaining provisions hereof shall not in any
way be affected or impaired.


 


Waivers:  No delay or omission by any Covered
Employee, by the Company or any of its subsidiaries, or by any Successor
Employer in exercising any right, power or privilege hereunder shall impair
such right, power or privilege, nor shall any single or partial exercise of any
such right, power or privilege preclude any further exercise thereof or the
exercise of any other right, power or privilege.


 


Assignment; Rights of Parties:  The rights and obligations of the Company,
its subsidiaries, each of the Covered Employees and each Successor Employer
shall inure to the benefit of, and shall be binding upon, the successors and
assigns of each of them.


 


GOVERNING  LAW.  THIS
PLAN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF MARYLAND, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW.


 


 


 


 


 


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THE
SHERIDAN GROUP, INC.


 


FIRST AMENDMENT

TO

CHANGE-OF-CONTROL INCENTIVE PLAN

(Key Management Employees)


 


WHEREAS, on May 12, 2003 The Sheridan Group, Inc., a
Maryland corporation (the “Company”), adopted a Change-of-Control Plan
(the “Plan”) for its key management employees; and


 


WHEREAS, the directors of the Company, by written
consent dated as of August __, 2003, have approved and authorized this First
Amendment to the Plan, pursuant to which the section of the Plan entitled “Other
Terms” shall be amended as set forth herein;


 


NOW THEREFORE, the “Other  Terms” section
of the Plan is hereby amended by adding the following new sub-section, “Amendment;
Termination”, after the sub-section entitled “Assignment; Rights
of Parties” and before the sub-section entitled “GOVERNING  LAW”:


 


1.             The
“Defined  Terms” section of the Plan is hereby amended by adding
the following new definition in appropriate alphabetical order:


 


“First Change of Control” means the first Change of Control to occur after the
date of adoption of the Plan.


 


2.             The
“Other  Terms” section of the Plan is hereby amended by adding the
following new sub-section, “Amendment; Termination”, after the
sub-section entitled “Assignment; Rights of Parties” and before
the sub-section entitled “GOVERNING  LAW”:


 


“Amendment; Termination:  The Board may, by action(s) duly approved in
accordance with the Company’s By-Laws and applicable law, amend or terminate
the Plan at any time (or, in the case of amendments, from time to time) after
the date of completion of the First Change of Control, provided that no
such amendment or termination shall, without the prior written consent of the
Covered Employee(s) so affected, adversely affect any of the rights or benefits
to which any of the Covered Employees is entitled under the Plan immediately
following the completion of the First Change of Control (including all rights
to payments and benefits upon a subsequent termination of the employment of
such Covered Employee(s)).”


 


3.             Except as expressly
set forth above, all of the terms and provisions of the Plan shall remain in
full force and effect and all references to the Plan shall hereinafter be
deemed to be references to the Plan as amended by this First Amendment.


 


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