**Exhibit 10.14**

 
|  |   | 01/27/05 |
|--|--------|----------|

 

**THE SHERIDAN GROUP, INC.**

 

**Change-of-ControlIncentive Plan**

 

Key Management Employees

 

The Sheridan Group, Inc. (the “Company”) proposes toadopt this Change-of-Control Incentive Plan (the “Plan”) for its key managementemployees, providing for payment of the Severance Benefits described below inthe event of certain terminations of employment following a change ofcontrol.  Any acquiror will be requiredto assume the Plan.

 

**Severance Benefits**:  During the period of eighteen (18) monthsfollowing a Change of Control, each Covered Employee will be entitled topayment by the Successor Employer of Severance Compensation following anytermination of such Covered Employee’s employment as a result of (a) suchCovered Employee’s termination of his or her employment for Good Reason or (b)the Successor Employer’s termination of such Covered Employee’s employmentwithout Cause.

 

**Defined Terms:**

 

**“Applicable Period”** meanseighteen (18) months.

 

**“Board of Directors”** means theBoard of Directors of the Company.

 

**“Cause”** means:

 

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

 

(ii)           theCovered Employee shall have been convicted by a court of competent jurisdictionof, or pleaded guilty or nolocontendere to, any felony or anycrime involving moral turpitude; or

 

(iii)          theCovered Employee shall have refused, after explicit written notice, to obey anylawful resolution of or direction by the Successor Board which is consistentwith the duties incident to his or her employment; or

 

(iv)          theCovered Employee shall have been chronically absent from work (excludingvacations, illnesses or leaves of absence approved by the Successor Board); or

 

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

 

----

 

(vi)          theCovered Employee shall have engaged in the unlawful use (including being underthe influence) or possession of illegal drugs on the Successor Employer’spremises.

 

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

 

**“Covered Employees”** means thoseemployees of the Company or any of its subsidiaries, who:

 

(i)            fromtime to time have been designated as Covered Employees by the Board ofDirectors and with respect to whom that designation has not been revoked (the Boardof Directors shall have the right in its sole discretion to designate CoveredEmployees and to revoke that designation); and

 

(ii)           remain employed by the Company,

 

at the time of theclosing of a Change of Control.

 

**“Disability”**means that anindependent medical doctor (selected by the Successor Employer’s health ordisability insurer) shall have certified that the Covered Employee has for 180days, consecutive or non-consecutive, in any twelve (12) month period beenphysically or mentally disabled in a manner which seriously interferes with hisor her ability to perform the duties incident to his or her employment.  Any refusal by a Covered Employee to submitto a medical examination for the purpose of certifying Disability shall bedeemed to constitute conclusive evidence of such Covered Employee’s Disability.

 

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

 

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

 

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

 

(ii)           involuntaryrelocation of the Covered Employee;

 

2

----

 

(iii)          anyremoval of the Covered Employee from or failure to reappoint him or her to anyof his or her positions held on the date of the Change of Control, except inconnection with the termination of his or her employment by the SuccessorEmployer for Cause or by the Covered Employee other than for Good Reason, or asa result of the Covered Employee’s death or Disability; or

 

(iv)          amaterial reduction by the Successor Employer in the Covered Employee’scompensation or benefits as in effect on the date of the Change of Control.

 

**“Incentive Bonuses”**means anymanagement incentive bonus paid to a Covered Employee, in accordance with anincentive bonus plan adopted by the Successor Board or maintained by theCompany and its subsidiaries, but excluding any “Retention Bonus” or othersimilar amount payable into such Covered Employee’s Deferred Compensation Plan.

 

**“Severance Compensation”**means:

 

(i)            severancepayments, in accordance with the Successor Employer’s then current payrollpractices, at an annual rate equal to the sum of (1) the Covered Employee’sbase salary in effect on the date of the Change of Control plus (2) the averageof the Incentive Bonuses earned by the Covered Employee for the two fiscalyears immediately preceding the date of his or her termination of employment,for the Applicable Period;

 

(ii)           continuedcoverage during the Applicable Period under the health insurance planmaintained by the Successor Employer for its full-time, salaried employees;

 

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

 

(iv)          immediatevesting (to the extent not previously vested) of the Covered Employee’sdeferred compensation account in accordance with the Company’s DeferredCompensation Plan.

 

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

 

**“Successor Employer”** means theentity continuing the business of the Company and its subsidiaries, or a partthereof, and employing the Covered Employee following a Change of Control.

 

**Other Terms:**

 

**At Will Employment: **Each of the Covered Employees is an at-willemployee of the Company or one of its subsidiaries, and his or her employmentmay be terminated at any time by such

 

3

----

 

Covered Employee’s or by his or her employer’s givingthe other party written notice of termination. Nothing contained in this Plan is intended to create for any of theCovered Employees any right to continued employment with the Company, any ofits subsidiaries, or any Successor Employer, or employment in the same positionor on the same terms as those currently in effect.

 

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

 

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

 

**Waivers: **No delay or omission by any CoveredEmployee, by the Company or any of its subsidiaries, or by any SuccessorEmployer in exercising any right, power or privilege hereunder shall impairsuch right, power or privilege, nor shall any single or partial exercise of anysuch right, power or privilege preclude any further exercise thereof or theexercise of any other right, power or privilege.

 

**Amendment; Termination**:  The Successor Board may, by action(s) dulyapproved in accordance with the Company’s By-Laws and applicable law, amend orterminate the Plan at any time (or, in the case of amendments, from time totime) after the date of completion of the First Change of Control, providedthat no such amendment or termination shall, without the prior written consentof the Covered Employee(s) so affected, adversely affect any of the rights orbenefits to which any of the Covered Employees is entitled under the Planimmediately following the completion of the First Change of Control (includingall rights to payments and benefits upon a subsequent termination of theemployment of such Covered Employee(s)).

 

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

 

**GOVERNING LAW.  THIS PLAN SHALL BE GOVERNED BY AND CONSTRUEDIN ACCORDANCE WITH THE LAWS OF THE STATE OF MARYLAND, WITHOUT REFERENCE TOPRINCIPLES OF CONFLICTS OF LAW.**

 

4

----