form10q11062008f.htm


    
      

      

    

    Exhibit
10.7

    
 

    THE
BLACK & DECKER

    EXECUTIVE
SALARY CONTINUANCE PLAN

    


     

    The
purpose of The Black & Decker Executive Salary Continuance Plan is to
provide the continuation of salary and certain employee benefits for covered
executives during a transition period following separation of the executive’s
service with the Black & Decker Companies.

     

    SECTION
I. DEFINITIONS.

     

    The
following terms shall have the meanings set forth below:

     

    1.1.           “Black & Decker” means The
Black & Decker Corporation, a Maryland corporation, and its successors.
“Black & Decker Companies”
means Black & Decker and all of its subsidiaries and affiliates. “Black & Decker Company” means
Black & Decker or any of its subsidiaries and affiliates.

     

    1.2.           “Cause” means: (a) an
Employee’s willful and continued failure to substantially perform his duties
after written notice to the Employee specifying such failure, or (b) fraud,
misappropriation or willfully engaging in conduct that is demonstrably and
materially injurious to the property or business of a Black & Decker
Company, monetarily or otherwise, or (c) the commission of a
felony.

     

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

     

    1.4.           “Continuance Period”
means the period authorized in writing by the Chief Executive Officer but in no
event longer than a period beginning with the Employee’s Severance Date and
ending on the last day of the twenty-fourth month following the date of the
Employee’s Severance Date.

     

    1.5.           “Employee” means an
elected officer of Black & Decker (other than an Assistant Treasurer or
Assistant Secretary) or any other employee of a Black & Decker Company whose
participation in the Plan has been authorized in writing by the Chief Executive
Officer of Black & Decker.

     

    1.6.           “ERISA” means the
Employee Retirement Security Act of 1974, as it may be amended from time to
time.

     

    1.7.           “Manager of the Plan”
means the Senior Vice President-Human Resources and Corporate Initiatives of
Black & Decker.

     

    1.8.           “Plan” means The Black
& Decker Executive Salary Continuance Plan, as set forth herein, as it may
be amended from time to time.

     

    1.9.           “Plan Administrator”
means The Black & Decker Corporation Pension Management
Committee.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        
           

          
            1.10.         “Salary Continuance”
means payments made to an Employee pursuant to Section 2.1 below.

             

            1.11.         “Severance” means the
“separation from service” (as defined at Code §409A and the regulations
thereunder) of an Employee with the Black & Decker Companies by a Black
& Decker Company for any reason other than for Cause. An Employee shall not
be considered to have incurred a Severance if his separation from service is by
reason of: (a) termination by the Employee for any reason, including but not
limited to any change in job or job duties, compensation, benefits (including
participation in the Plan) or workplace for any reason, (b) the Employee’s
death, (c) a physical or mental condition that causes the Employee to be unable
substantially to perform his duties, including without limitation any condition
that entitles the Employee to benefits under any sick pay or disability income
policy or program of a Black & Decker Company, (d) the Employee’s retirement
as permitted by applicable law, or (e) termination by the Employee before the
Severance Date scheduled by the Black & Decker Company that employs the
Employee.

             

            1.12.         “Severance Date” means
the effective date of an Employee’s Severance.

             

          

        

      

    

     

    SECTION
2. BENEFITS.

     

    2.1.           Each
Employee who incurs a Severance shall be entitled to continue to receive his
base salary (as of the date of Severance) at normal payroll periods during the
Continuance Period, or until he obtains another position (including a position
with a Black & Decker Company), or until his death, whichever comes first;
provided, however, that if the salary payments exceed an amount that when
annualized exceeds the Code §401(a)(17) dollar limit for the year of the
Employee’s Severance Date, the excess amount of the payments for the first six
months following the Employee’s Severance Date shall be accumulated and paid to
the Employee in a single-sum payment on the date that is six months and one day
following the Employee’s Severance Date. If the Employee obtains another
position during the Continuance Period, the amount of Salary Continuance paid to
the Employee shall be reduced by the amount of gross compensation paid or
payable to the Employee or credited to his account or for his benefit in
connection with the other position.

     

    2.2.           No
Employee shall be eligible to receive Salary Continuance or any other benefits
under the Plan unless he first executes a valid and legally binding release in
writing, in a form and manner prescribed by the Manager of the Plan, releasing
the Black & Decker Companies and their employees, officers and directors
from claims and liabilities of any kind relating to the Employee’s
employment.

     

    2.3.           If
a Black & Decker Company is or should become obligated by law or by contract
to pay an Employee severance pay, salary continuance, notice pay, a termination
indemnity, or the like, or if a Black & Decker Company is or should become
obligated by law or by contract to provide advance notice of separation
(“Notice”) to an Employee, then, unless specifically provided otherwise in any
such law or contract, any Salary Continuance otherwise payable under the Plan to
the Employee shall be reduced by the amount of any such severance pay, salary
continuance, notice pay, termination indemnity, or the like, and by the amount
of any compensation received with respect to any Notice period (including any
Notice period that may

     

    
      
        
        

      

      
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    be
required under the Worker Adjustment and Retraining Notification Act) during
which the Employee is not required to work. If an Employee applies for and
receives unemployment compensation payments for any period of time for which
Salary Continuance is made, any Salary Continuance remaining to be made shall be
reduced by the amount of the unemployment compensation payments.

     

    2.4.           Each
Employee who incurs a Severance shall also be entitled to continue to receive
the employee benefits described below during the Continuance Period, or until he
obtains another position (including a position with a Black & Decker
Company), or until his death, whichever comes first; provided the Employee
continues to pay the required employee contribution for the coverage. Provided
the Employee was eligible for and received these employee benefits before the
Severance Date, and provided that the Black & Decker Company which employed
the Employee continues to provide such benefits to similarly situated employees,
and subject to such amendments and changes in such benefit plans, programs,
practices and policies as may be made from time to time, the benefits that will
be continued are: medical, dental, executive life insurance, tax preparation
expense reimbursement, automobile allowance, executive physical examination and
country club memberships.  Notwithstanding the foregoing, the amount
of any of these reimbursements or benefits that is available in any taxable year
of an Employee shall not affect the amount of reimbursements or benefits
available in a different taxable year, and any reimbursement payment shall be
made no later than the end of the year following the year the expense is
incurred.  If the Employee obtains another position prior to the end
of the Continuance Period, and if the position does not offer each of these
benefits, then the benefits that are not offered by the other position will be
continued during the Continuance Period until the benefits are offered by the
other position or until the Employee’s death, whichever occurs first, strictly
on a benefit-by-benefit basis. A benefit will not be continued after the
Employee obtains another position if that benefit is available in the other
position, even if the benefit offered by the other position is inferior to the
benefit offered before the Severance Date, or requires larger employee
contributions for the coverage.

     

    2.5.           All
other benefits, including vacation pay and short term and long term disability,
shall be discontinued on the Severance Date. Unless provided in an agreement
between the Employee and a Black & Decker Company, the Employee’s employment
shall be deemed to have terminated on his or her Severance Date for purposes of
any pension, profit-sharing, deferred compensation, stock option, restricted
stock, stock bonus or stock purchase plans, whether tax-favored or otherwise,
that is sponsored or administered by a Black & Decker Company and in which
the Employee participated prior to the Severance Date.

     

    SECTION
3. CLAIMS, OPERATION
AND INTERPRETATION.

     

    3.1.           The
Plan shall be interpreted, administered, and operated by the Manager of the Plan
and the Plan Administrator, each of whom shall have complete authority, in his
or their sole discretion, to interpret the Plan, to prescribe, amend, interpret
and rescind rules and regulations relating to the Plan, and to make all of the
determinations necessary or advisable for the administration of the Plan. It is
intended that the Plan comply with Code § 409A of the Code and the regulations
and guidance issued thereunder, and it shall be interpreted
accordingly.

     


    
      
        
          
             



        

         


      

      
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    3.2.           All
questions of any character whatsoever arising in connection with the
interpretation of the Plan or its administration or operation shall be submitted
to and settled and determined in an equitable and fair manner in accordance with
the procedure for claims and appeals described in Section 3.4. Subject to the
provisions of Section 7.4, any such settlement and determination shall be final
and conclusive, and shall bind and may be relied upon by the Black & Decker
Companies, each of the Employees, and all other parties in
interest.

     

    3.3.           The
Plan Administrator and the Manager of the Plan may delegate any of their duties
hereunder to such person or persons as they may designate from time to
time.

     

    3.4.           An
Employee shall file a written claim with the Manager of the Plan in order to
receive Salary Continuance or any other benefits under the Plan. The Manager of
the Plan shall, within 60 days after receipt of the written claim, send a
written notification to the Employee as to its disposition. In the event the
claim is wholly or partially denied, the written notification shall (a) state
the specific reason or reasons for the denial, (b) make specific reference to
pertinent Plan provisions on which the denial is based, (c) provide a
description of any additional material or information necessary for the Employee
to perfect the claim and an explanation of why such material or information is
necessary, and (d) set forth the procedure by which the Employee may appeal the
denial of his claim. In the event an Employee wishes to appeal the denial of his
claim, he may request a review of the denial by making application in writing to
the Plan Administrator within 60 days after receipt of the denial. The Employee
(or his duly authorized legal representative) may, upon written request to the
Plan Administrator, review any documents pertinent to his claim, and submit in
writing issues and comments in support of his position. Within 60 days after
receipt of a written appeal (unless the Plan Administrator determines that
special circumstances, such as the need to hold a hearing, require an extension
of time, but in no event more than 120 days after such receipt) the Plan
Administrator shall notify the Employee of the final decision. The final
decision shall be in writing and shall include specific reasons for the
decision, written in a manner calculated to be understood by the claimant, and
specific references to the pertinent Plan provisions on which the decision is
based. In the event the Employee wishes to appeal from the Plan Administrator’s
decision, the Employee may submit the claim to final and binding arbitration, in
accordance with Section 7.4, by giving written notice to the Plan Administrator
within 60 days after receipt of the Plan Administrator’s decision. No
arbitration for benefits under the Plan may be commenced unless and until the
Employee has submitted a written claim for benefits, has been notified that the
claim has been denied, has filed a written request for review of the denied
claim, and has been notified in writing that the denial of the claim has been
affirmed, all in accordance with the claims procedure described
above.

     

    SECTION
4. PLAN MODIFICATION
OR TERMINATION.

     

    4.1.           The
Plan may be modified or amended by Black & Decker, by action of the Board of
Directors, at any time with or without notice. Without limiting the foregoing,
the Plan may be modified or amended to increase, decrease or eliminate Salary
Continuance and benefits payable to any Employee who incurs a Severance after
such modification or amendment.

     

    4.2.           It
is the intention of Black & Decker to continue the Plan and to pay Salary
Continuance to all Employees who have incurred a Severance. However, Black &
Decker, by action of the Board of Directors, may for any reason terminate the
Plan, or the Chief Executive

     

    
      
        
        

      

      
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    Officer
of Black & Decker may withhold its application as to some or all Employees,
at any time or from time to time, in each case with or without
notice.

     

    4.3.           Any
modification, amendment, termination, withholding, extension or other action
shall only apply to Employees who incur a Severance after such action. No such
action shall reduce or eliminate the Salary Continuance of any Employee whose
Severance Date occurs on or before such action is
taken.  Notwithstanding the foregoing, the Plan may be amended at any
time, including retroactively, to conform the Plan to the provisions of Code §
409A of the Code and the regulations and guidance thereunder.  No such
amendment shall be considered prejudicial to any interest of any Employee
hereunder.

     

    SECTION
5. GOVERNMENT LAWS AND
REGULATIONS.

     

    5.1.           The
Plan, as a “severance pay arrangement” within the meaning of Section 3(2)(B)(i)
of ERISA, is intended to be excepted from the definitions of “employee pension
benefit plan” and “pension plan” in Section 3(2) of ERISA, and is intended to
meet the descriptive requirements of a plan constituting a “severance pay plan”
within the meaning of regulations published by the Secretary of Labor at Title
29, Code of Federal Regulations, Section 2510.3-2(b), and shall be interpreted
accordingly.

     

    5.2.           The
Plan and the rights of Employees to Salary Continuance and benefits under the
Plan shall be subject to all applicable governmental laws and regulations.
Notwithstanding any other provision of the Plan to the contrary, the Manager of
the Plan and the Plan Administrator may in his or their discretion make such
changes in the Plan as may be required to conform the Plan to all applicable
governmental laws and regulations.

     

    SECTION
6. EMPLOYEE
CONDUCT.

     

    
      6.1.           Notwithstanding
anything to the contrary, all of an Employee’s rights to Salary Continuance and
to benefits under the Plan will be forfeited if the Employee discloses
confidential information of a Black & Decker Company or if the Employee,
without the written consent of the Manager of the Plan, enters into competition
with a Black & Decker Company.

    

     

    6.2.           For
purposes of this Section 6, the Employee shall be deemed to be in competition
with a Black & Decker Company if the Employee, directly or indirectly,
solicits as a customer any company that is or was a customer of a Black &
Decker Company during the Employee’s employment, or that is or was a potential
customer of a Black & Decker Company with which a Black & Decker Company
has made or will make business contacts during the Employee’s employment;
provided, however, that solicitation of a company as a customer of any business
that is not in direct or indirect competition with any of the types of business
conducted by a Black & Decker Company within any of the same territories as
the Black & Decker Company shall not be prohibited hereby. In addition, an
Employee shall be deemed to be in competition with a Black & Decker Company
if the Employee directly or indirectly becomes an owner, officer, director,
operator, sole proprietor, partner, joint venturer, contractor or consultant, or
participates in or is connected with the ownership, operation, management or
control of any company in direct or indirect competition with any of the types
of businesses conducted by a Black & Decker Company within any of the same
territories as a Black & Decker Company;

     


    
      
        
           

          


        

         


      

      
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    provided,
however, that the ownership for investment of less than 5% of the outstanding
stock of any of the classes of stock issued by a publicly held company shall not
be prohibited hereby.

     

    6.3.           For
the purposes of this Section 6, the Employee shall be deemed to have disclosed
“confidential information” if the Employee fails to preserve as confidential and
uses, communicates, or discloses to any person, to the actual or potential
detriment of a Black & Decker Company, orally, in writing or by publication,
any information, regardless of when, where or how acquired, relating to or
concerning the affairs of a Black & Decker Company; provided, however, that
the foregoing obligations shall not apply to information that is or becomes
public through no fault of the Employee.

     

    6.4.           The
Plan Administrator shall have the absolute right to determine in its sole
discretion (a) whether or not an Employee’s employment was terminated for Cause,
and (b) whether or not an Employee has entered into competition with a Black
& Decker Company or has disclosed confidential information so as to cause a
forfeiture of the Employee’s rights and benefits hereunder.

     

    SECTION
7. GENERAL
PROVISIONS.

     

    7.1.           Nothing
in the Plan shall be deemed to give any Employee the right to be retained in the
employ of any Black & Decker Company or to interfere with the right of any
Black & Decker Company to discharge an Employee at any time and for any
lawful reason, with or without notice or cause. In addition, nothing in the Plan
shall restrict an Employee’s right to terminate his employment at any
time.

     

    7.2.           Except
as otherwise provided herein or by law, no right or interest of an Employee
under the Plan shall be assignable or transferable, in whole or in part, either
directly or by operation of law or otherwise, including without limitation by
execution, levy, garnishment, attachment, pledge, or any other manner; no
attempted assignment or transfer thereof shall be effective; and no right or
interest of an Employee under the Plan shall be liable for, or subject to, any
obligation or liability of an Employee. When a payment is due under the Plan to
an Employee and the Employee is unable to care for his affairs, payment may be
made directly to his legal guardian or personal representative.

     

    7.3.           Black
& Decker may, at any time and from time to time, without any Employee’s
consent, assign its interest in the Plan with respect to one or more Employees
to a Black & Decker Company, which shall assume all of Black & Decker’s
obligations hereunder with respect to such Employees and, upon such assignment,
the assignee shall be substituted for Black & Decker for all purposes under
the Plan with respect to such Employees. Any such assignment and assumption
shall constitute a novation and the assignee(s) shall be substituted
automatically for Black & Decker with respect to such Employees. Any such
assignee shall have the same rights as the assignor to further assign the
Plan.

     

    7.4.           Any
dispute or controversy arising out of or relating to the Plan (or to payor
benefits that may be provided under the Plan), as well as any dispute or
controversy arising out of or relating to the termination of an Employee’s
employment, including any claims based on federal, state or local laws
(including employment discrimination or wrongful dismissal laws),

     


    
      
        
          
             



        

         


      

      
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    shall be
settled exclusively by final and binding arbitration, conducted in Towson,
Maryland before a neutral arbitrator with expertise in employment law, including
ERISA, in accordance with the Employee Benefit Plan Claims Arbitration Rules of
the American Arbitration Association. In reaching a decision, the arbitrator
shall interpret, apply and be bound by the Plan and by applicable law. The
arbitrator shall apply the same standard of review in disputes relating to the
Plan or to Plan benefits as a court of competent jurisdiction would apply under
ERISA. The arbitrator shall have no authority to add to, detract from, or modify
the Plan or any law in any respect. The arbitrator may grant any remedy or
relief that may be necessary to make the injured party whole, provided that in
no event may the arbitrator grant any remedy or relief that a court of competent
jurisdiction could not grant, nor any relief greater than that sought by the
injured party. Judgment may be entered on the arbitrator’s award in any court of
competent jurisdiction.

     

    7.5.           The
Plan is unfunded. Except as provided in Section 7.3, the liability for Salary
Continuance and other benefits under the Plan are solely the responsibility of
Black & Decker. Salary Continuance shall be payable from Black &
Decker’s general assets, and no other company shall have any responsibility or
liability under the Plan. However, Black & Decker’s liabilities under the
Plan shall be discharged to the extent of any payment or benefit received by the
Employee from any other company made for that purpose and on Black &
Decker’s behalf or for its benefit.

     

    7.6.           If
any provision of the Plan shall be held void or unenforceable, the remainder of
the Plan shall remain in full force and effect, and the Plan shall be construed
as if such void or unenforceable provision were omitted; provided that in
interpreting this Plan the arbitrator shall replace such void or unenforceable
provision with an effective and legally permissible provision, the effect of
which shall be identical to, or as close as reasonably possible to, the effect
of the original provision.

     

    7.7.           As
used in this Plan, any reference to the masculine, feminine, or neuter gender
shall include all genders, the plural shall include the singular, and the
singular shall include the plural.

     

    Amendment
and Restatement adopted October 16, 2008

    


    


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