Document:

Unitrin is a party to individual severance agreements

 EXHIBIT 10.11 
 January 1, 2002 
 CONFIDENTIAL 
 Dear: 
 Unitrin, Inc. (the “Company”) considers you to be a valued employee of the Employer (as defined below). In recognition of
the value of your continued services to the Employer, the Company’s shareholders and other relevant constituencies, the Company proposes the following agreement (the “Agreement”) to provide you with certain severance payments
and benefits if your employment terminates following a “Change in Control” (as defined below). 
 ARTICLE I 
 DEFINITIONS 
  

	1.1	Definitions 

 Whenever used in this Agreement, the following capitalized
terms shall have the meanings set forth in this Section, certain other capitalized terms being defined elsewhere in this Agreement: 
 (a)
“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of the Exchange Act. 
 (b)
“Annualized Compensation” shall mean your rate of annual base salary as in effect immediately prior to your Qualifying Termination, without regard to any decrease in such salary constituting an Enumerated Event. 
 (c) “Beneficial Owner” shall have the meaning ascribed to such term in Rule 13d-3 promulgated under the Exchange Act. 

 (d) “Board of Directors” shall mean the Board of Directors of the Company, or any
successor thereto. 
 (e) A “Change in Control” shall be deemed to have occurred if the event set forth in any one of the
following paragraphs shall have occurred: 
 (i) any Person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or any of its Subsidiaries or Affiliates) representing 25% or more of the combined voting power of the
Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in clause (A) of paragraph (iii) below; or 
 (ii) the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, on
the date hereof, constitute the Board of Directors and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of directors of the Company)
whose appointment or election by the Board of Directors or nomination for election by the Company’s shareholders was approved or recommended by a vote of at least two-thirds of the directors then still in office who either were directors on the
date hereof or whose appointment, election or nomination for election was previously so approved or recommended; or 
 (iii)
there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than (A) a merger or consolidation which results in the directors of the Company immediately
prior to such merger or consolidation continuing to constitute at least a majority of the board of directors of the Company, the surviving entity or any parent thereof or (B) a merger or consolidation effected to implement a recapitalization of
the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from
the Company or any of its Subsidiaries or Affiliates) representing 25% or more of the combined voting power of the Company’s then outstanding securities; or 
  

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 (iv) the shareholders of the Company approve a plan of complete liquidation or
dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the
Company’s assets immediately following which the individuals who comprise the Board of Directors immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed or any
parent thereof. 
 (f) “Company” shall mean Unitrin, Inc., a Delaware corporation, and any successor as provided in Article
IV. 
 (g) “Disability” shall mean a physical or mental condition entitling you to benefits under the applicable long-term
disability plan of the Company or any of its Subsidiaries or Affiliates, or if no such plan exists, causing you to be unable to substantially perform your duties with the Employer for at least 6 months in any 12-month period. 
 (h) Your “Employer” shall mean the Company or any Subsidiary or Affiliate of the Company by which you are employed. 
 (i) “Enumerated Event” shall mean the occurrence after any Change in Control, or prior to a Change in Control under the circumstances
described in clause (ii) of the second and third sentences of Section 2.1 hereof (treating all references in paragraphs (i) through (iv) below to a “Change in Control” as references to a “Potential Change in
Control”), of any one or more of the following events without your express written consent: 
 (i) a reduction in your
base salary as in effect immediately prior to the Change in Control, or a material reduction in the compensation and benefit plans, arrangements, policies and procedures, taken as a whole, provided to you from those, taken as a whole, provided to
you immediately prior to the Change in Control; 
 (ii) a material reduction in your job authority and responsibility;

 (iii) the Employer requires you to change the location of your job or office, so that you will be based at a location more
than thirty miles from the location of your job or office immediately prior to the Change in Control; 
 (iv) a successor
company fails or refuses to assume the Company’s obligations under this Agreement, as required by Article IV hereof (and for purposes of a termination of your 

  

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employment following an Enumerated Event described in this subsection (iv), the date on which any such succession becomes effective shall be deemed the Date
of Termination); or 
 (v) any purported termination of your employment which is not effected pursuant to the terms of
Section 7.5 hereof. 
 (j) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. 
 (k) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (l) “Just Cause” shall mean, with respect to a termination of your employment with the Employer, (a) fraud, misappropriation of or
intentional material damage to the property or business of the Company (including its Subsidiaries and Affiliates), which in any such case is materially injurious to the Company (including its Subsidiaries and Affiliates), monetarily or otherwise,
or (b) your conviction for the commission of a felony. 
 (m) “Person” shall have the meaning given in
Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the Company or any of its Subsidiaries or Affiliates, (ii) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any of its Subsidiaries or Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, (iv) a corporation owned, directly or
indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of stock of the Company, (v) any individual, entity or group whose ownership of securities of the Company is reported on Schedule 13G
pursuant to Rule 13d-1 promulgated under the Exchange Act (but only for so long as such ownership is so reported) or (vi) Singleton Group LLC or any successor in interest to such entity. 
 (n) A “Potential Change in Control” shall be deemed to occur in the event that (a) the Company enters into an agreement, the
consummation of which would result in a Change in Control, (b) the Company or any Person publicly announces an intention to take or to consider taking action which, if consummated, would constitute a Change in Control, (c) any Person becomes
the Beneficial Owner, directly or indirectly, of securities of the Company representing 15% or more of either the then outstanding shares of common stock of the Company or the combined voting power of the Company’s then outstanding securities
(not including in the securities beneficially owned by such Person any securities acquired directly from the Company or any of its Subsidiaries or Affiliates) or (d) the Board of Directors adopts a resolution to the effect that, for purposes of
this Plan, a Potential Change in Control has occurred. 
  

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 (o) “Qualifying Termination” shall mean a termination of employment pursuant to
Section 2.1 entitling you to a Severance Payment pursuant to the terms of this Agreement. 
 (p) “Severance Payment”
shall mean the payment described in Section 2.2. 
 (q) “Subsidiary” shall mean any entity more than 50% of the voting
securities of which are Beneficially Owned by the Company. 
 ARTICLE II 
 SEVERANCE PAYMENTS 
  

	2.1	Right to Severance Payment 

 You shall be entitled to receive a Severance
Payment from the Company in the amount provided in Section 2.2 if (x) there has been a Change in Control, (y) you are an active employee at the time of the Change in Control, and (z) within two years from and including the date
of the Change in Control, your employment is terminated by the Employer for any reason (other than Just Cause or your death or Disability), or you terminate your employment for any reason. In addition, if prior to a Change in Control (i) your
employment is terminated by the Employer for any reason (other than Just Cause or your death or Disability) or (ii) you terminate your employment following the occurrence of any Enumerated Event, and you reasonably demonstrate that such
termination or Enumerated Event, as the case may be, (a) occurred at the request of a Person who has indicated an intention or taken steps reasonably calculated to effect a Change in Control or (b) otherwise occurred in connection with, or
in anticipation of, a Change in Control (whether or not a Change in Control actually occurs), then for all purposes of this Agreement the termination of your employment shall be deemed to have occurred immediately following a Change in Control.
There shall be an irrebuttable presumption that (i) if your employment is terminated by the Employer for any reason (other than Just Cause or your death or Disability) within ninety (90) calendar days prior to the date of a Change in
Control, or (ii) if you terminate your employment following the occurrence of an Enumerated Event which occurs within ninety (90) calendar days prior to the date of a Change in Control, you will have made (in either case (i) or (ii))
the showing required by the preceding sentence. For purposes of subclause (y) above, you will still be considered to be an active employee if you are on sick leave, military leave or any other leave of absence approved by the Employer.

  

	2.2	Amount of Severance Payment 

 (a) If you become entitled to
a Severance Payment under this Agreement, the Company shall pay to you a lump sum payment equal to [2][3] times one year’s Annualized Compensation. 
  

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 (b) The Severance Payment otherwise calculated under this Section 2.2 shall be reduced (but not
below zero) by the amount of cash severance-type benefits to which you may be entitled pursuant to any other severance plan, agreement, policy or program of the Company or any of its Subsidiaries or Affiliates. Without limiting other payments which
would not constitute “cash severance-type benefits” hereunder, any cash settlement of stock options, accelerated vesting of stock options and retirement, pension and other similar benefits shall not constitute “cash severance-type
benefits” for purposes of this Section 2.2(b). 
  

	2.3	Gross-Up for Excise Taxes 

 (a) In the event that any
payment or benefit (within the meaning of Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (the “Code”)), to you or for your benefit paid or payable or distributed or distributable pursuant to the terms of
this Agreement or otherwise in connection with, or arising out of, your employment with the Company or any of its Subsidiaries or Affiliates or a Change in Control (a “Payment” or “Payments”), would be subject to
the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by you with respect to such excise tax (such excise tax, together with any such interest and penalties, collectively, the “Excise
Tax”), then the Company shall pay to you an additional payment (a “Gross-Up Payment”) in an amount such that after payment by you of all taxes (including any interest or penalties imposed with respect to such taxes and the
Excise Tax (other than interest and penalties imposed by reason of your failure to file timely a tax return or pay taxes shown due on your return) and after taking into account the phase out of itemized deductions and personal exemptions
attributable to the Gross-Up Payment), including any Excise Tax imposed upon the Gross-Up Payment, you retain an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. 
 (b) An initial determination as to whether a Gross-Up Payment is required pursuant to this Agreement and the amount of such Gross-Up Payment shall be made
at the Company’s expense by an accounting firm appointed by the Company prior to the Change in Control (the “Accounting Firm”). The Accounting Firm shall provide its determination (the “Determination”),
together with detailed supporting calculations and documentation to the Company and you within fifteen (15) calendar days of the date on which your right to a Severance Payment hereunder was triggered (if requested at that time by the Company
or you) or such other time as requested by the Company or by you (in either case provided that you believe in good faith that any of the Payments may be subject to the Excise Tax); provided that if the Accounting Firm determines that no Excise Tax
is payable by you with respect to a Payment or Payments, it shall furnish you with an opinion reasonably acceptable to you that no Excise Tax will be imposed with respect to any such Payment or Payments. Within ten (10) calendar days of the
delivery of the Determination to you, you shall have the right to dispute the Determination (the “Dispute”). The Gross-Up Payment, if any, as determined 

  

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pursuant to this Section 2.3(b) shall be paid by the Company to you within five (5) calendar days of the receipt of the Accounting Firm’s
Determination. The existence of any Dispute shall not in any way affect your right to receive the Gross-Up Payment, if any, in accordance with the Determination. If there is no Dispute, the Determination shall be binding, final and conclusive upon
the Company and you, subject to the application of Section 2.3(d). 
 (c) For purposes of determining whether any of the Payments will be
subject to the Excise Tax and the amount of such Excise Tax, (i) all of the Payments shall be treated as “parachute payments” (within the meaning of section 280G(b)(2) of the Code) unless, in the opinion of tax counsel (“Tax
Counsel”) reasonably acceptable to you and selected by the Accounting Firm, such payments or benefits (in whole or in part) do not constitute parachute payments, including by reason of section 280G(b)(4)(A) of the Code, (ii) all
“excess parachute payments” within the meaning of section 280G(b)(l) of the Code shall be treated as subject to the Excise Tax unless, in the opinion of Tax Counsel, such excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered (within the meaning of section 280G(b)(4)(B) of the Code) in excess of the Base Amount (as defined in section 280G(b)(3) of the Code) allocable to such reasonable compensation, or are otherwise not subject
to the Excise Tax, and (iii) the value of any noncash benefits or any deferred payment or benefit shall be determined by the Accounting Firm in accordance with the principles of sections 280G(d)(3) and (4) of the Code. For purposes of
determining the amount of the Gross-Up Payment, you shall be deemed to pay federal income tax at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes
at the highest marginal rate of taxation in the state and locality of your residence on the Date of Termination (or if there is no such date, then the date on which the Gross-Up Payment is calculated for purposes of this Section 2.3), net of
the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. 
 (d) As a result of the
uncertainty in the application of Sections 4999 and 280G of the Code, it is possible that a Gross-Up Payment (or a portion thereof) will be paid which should not have been paid (an “Excess Payment”) or a Gross-Up Payment (or a
portion thereof) which should have been paid will not have been paid (an “Underpayment”). An Underpayment shall be deemed to have occurred (i) upon notice (formal or informal) to you from any governmental taxing authority that
your tax liability (whether in respect of your current taxable year or in respect of any prior taxable year) may be increased by reason of the imposition of the Excise Tax on a Payment or Payments with respect to which the Company has failed to make
a sufficient Gross-Up Payment, (ii) upon a determination by a court, (iii) by reason of determination by the Company (which shall include the position taken by the Company, together with its consolidated group, on its federal income tax return)
or (iv) upon the resolution of any Dispute to your satisfaction. If an Underpayment occurs, you shall promptly notify the Company 

  

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and the Company shall promptly, but in any event at least ten (10) calendar days prior to the date on which the applicable government taxing authority has
requested payment, pay to you an additional Gross-Up Payment equal to the amount of the Underpayment plus any interest and penalties (other than interest and penalties imposed by reason of your failure to file timely a tax return or pay taxes shown
due on your return) imposed on the Underpayment. An Excess Payment shall be deemed to have occurred upon a “Final Determination” (as defined below) that the Excise Tax will not be imposed upon a Payment Payments (or portion thereof) with
respect to which you had previously received a Gross-Up Payment. A “Final Determination” shall be deemed to have occurred when you have received from the applicable government taxing authority a refund of taxes or other reduction in
your tax liability by reason of the Excise Payment and upon either (x) the date a determination is made by, or an agreement is entered into with, the applicable governmental taxing authority which finally and conclusively binds you and such
taxing authority, or in the event that a claim is brought before a court of competent jurisdiction, the date upon which a final determination has been made by such court and either all appeals have been taken and finally resolved or the time for all
appeals has expired or (y) the statute of limitations with respect to your applicable tax return has expired. If an Excess Payment is determined to have been made, the amount of the Excess Payment shall be treated as a loan by the Company to
you and you shall pay to the Company on demand (but not less than ten (10) calendar days after the determination of such Excess Payment and written notice has been delivered to you) the amount of the Excess Payment plus interest at an annual
rate equal to the Applicable Federal Rate provided for in Section 1274(d) of the Code from the date the Gross-Up Payment (to which the Excess Payment relates) was paid to you until the date of repayment to the Company. 
 (e) Notwithstanding anything contained in this Agreement to the contrary, in the event that, according to the Determination, an Excise Tax will be imposed
on any Payment or Payments, the Company shall pay to the applicable government taxing authorities, as Excise Tax withholding, the amount of the Excise Tax that the Company has actually withheld from the Payment or Payments. 
  

	2.4	No Duty of Mitigation 

 The Company acknowledges that it would be very
difficult and generally impracticable to determine your ability to, or extent to which you may, mitigate any damages or injuries you may incur by reason of the Change in Control. The Company has taken this into account in entering into this
Agreement and, accordingly, the Company acknowledges and agrees that you shall have no duty to mitigate any such damages and that you shall be entitled to receive your entire Severance Payment regardless of any income which you may receive from
other sources following your termination after any Change in Control. 
  

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	2.5	Time of Severance Payment 

 The Severance Payment to which you are entitled
shall be paid to you, in cash and in full, not later than ten (10) calendar days after the termination of your employment. If you should die before all amounts payable to you have been paid, such unpaid amounts shall be paid to your beneficiary
under this Agreement or, if you have not designated such a beneficiary in writing to the Company, to the personal representative(s) of your estate. 
  

	2.6	Life and Health Insurance Coverage 

 If you are entitled to receive a
Severance Payment under Section 2.1, the Company shall also provide you with the following additional benefits: 
 (a) Life insurance
coverage for you and your dependents having a face amount at least equal to the greater of (i) the amount in effect for you (in your case) and/or your dependents (in the case of your dependents) immediately prior to the Change in Control, or
(ii) the amount in effect for you (in your case) and/or your dependents (in the case of your dependents) immediately prior to the Date of Termination, such coverage to be provided under the same plan or plans under which you (in your case) or
your dependents (in the case of your dependents) were covered immediately prior to the Change in Control (or Date of Termination, as applicable) or substantially similar plan(s) established by the Company or any of its Subsidiaries or Affiliates
thereafter, and at no greater cost to you (in your case) or your dependents (in the case of your dependents) than was imposed pursuant to the plan(s) under which you (in your case) and/or your dependents (in the case of your dependents) were covered
immediately prior to the Change in Control (or Date of Termination, as applicable). This coverage will continue for the period hereinafter provided. 
 (b) Health insurance coverage (including any dental coverage) for you and your dependents under the same plan or plans under which you were covered immediately prior to the Change in Control (or, if more favorable, immediately prior to the
Date of Termination) or substantially similar plan(s) established by the Company or any of its Subsidiaries or Affiliates thereafter, and at no greater cost to you (in your case) or your dependents (in the case of your dependents) than was imposed
pursuant to the plan(s) under which you (in your case) and/or your dependents (in the case of your dependents) were covered immediately prior to the Change in Control (or Date of Termination, as applicable). This coverage will continue for the
period hereinafter provided. 
 (c) The benefits provided under this Section 2.6 shall continue for a period of [2][3] years following
the date of your Qualifying Termination; provided, however, that the benefits for medical coverage under the provisions of Section 2.6(b) shall end as of the date you become covered under any group health plan maintained by a subsequent
employer which provides benefits to you (and anyone 

  

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entitled to claim the benefits described in Section 2.6(b) under or through you) not materially less favorable than the benefits described in
Section 2.6(b), and which does not exclude any pre-existing condition that you or your dependents may have at that time. 
  

	2.7	Outplacement Services 

 If you are entitled to receive a Severance Payment
under Section 2.1, the Company shall also provide you with a full range of outplacement services provided for up to fifty-two (52) weeks by a reputable organization chosen by the Company. These outplacement services will be paid for by the
Company. 
  

	2.8	Withholding of Taxes 

 The Company or your Employer may withhold from any
amounts payable under this Agreement all federal, state, city or other taxes required by applicable law to be withheld. 
  

	2.9	No Setoff 

 The Company’s obligation to make Severance Payments to you
pursuant to this Agreement and otherwise to perform its obligations hereunder shall not be affected by any circumstances, including, but not limited to, any setoff, counterclaim, recoupment, defense or other right which the Company or any of its
Subsidiaries or Affiliates may have against you or others. 
  

	2.10	Benefits Under Other Plans 

 The benefits that you may be entitled to
receive pursuant to Sections 2.6 and 2.7 of this Agreement are not intended to be duplicative of any similar benefits to which you may be entitled from the Company or any of its Subsidiaries or Affiliates under any other severance plan, agreement,
policy or program maintained by the Company or any of its Subsidiaries or Affiliates. Accordingly, the benefits to which you are entitled under Sections 2.6 and 2.7 shall be reduced to take account of any other similar benefits to which you are
entitled from the Company or any of its Subsidiaries or Affiliates. 
 ARTICLE III 
 OTHER RIGHTS AND BENEFITS NOT AFFECTED 
  

	3.1	Other Benefits 

 This Agreement does not provide a pension for you nor
shall any payment hereunder be characterized as deferred compensation. Except as set forth in Sections 2.2(b) and 2.10, neither the provisions of this Agreement nor the Severance Payment provided for hereunder shall reduce any amounts otherwise
payable, or in any way diminish your rights as an employee, whether existing now or hereafter, under any benefit, incentive, 

  

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retirement, stock option, stock bonus or stock purchase plan or any employment agreement or other plan or arrangement not related to severance. Any such
other amounts or benefits payable shall be included, as necessary, for making any of the calculations required under Section 2.3. 
  

	3.2	Employment Status 

 This Agreement does not constitute a contract of
employment or impose on you any obligation to remain in the employ of the Employer, nor does it impose on the Company or any of its Subsidiaries or Affiliates any obligation to retain you in your present or any other position, or to change the
status of your employment as an employee at will. Nothing in this Agreement shall in any way require the Company or any of its Subsidiaries or Affiliates to provide you with any severance benefits prior to a Change in Control (except that the
foregoing shall not modify the second and third sentences of Section 2.1), nor shall this Agreement ever be construed in any way as establishing any policies or requirements of the Company or any of its Subsidiaries or Affiliates for the
termination of your employment or the payment of severance benefits to you if your employment terminates prior to a Change in Control, nor shall anything in this Agreement in any way affect the right of the Company or any of its Subsidiaries or
Affiliates in its absolute discretion to change prior to a Change in Control one or more benefit plans, including but not limited to pension plans, dental plans, health care plans, savings plans, bonus plans, vacation pay plans, disability plans,
and the like. 
 ARTICLE IV 
 SUCCESSOR TO COMPANY 
 The Company shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or
otherwise, to all or substantially all the business or assets of the Company, expressly and unconditionally to assume and agree to perform the Company’s obligations under this Agreement, in the same manner and to the same extent that the
Company would be required to perform if no such succession or assignment had taken place. In such event, the term “Company,” as used in this Agreement, shall mean the Company as herein before defined and any successor or assignee to the
business or assets which by reason hereof becomes bound by the terms and provisions of this Agreement. 
 ARTICLE V 
 LEGAL FEES AND EXPENSES 
 The Company shall pay as they
become due all legal fees, costs of litigation and other expenses incurred in good faith by you as a result of the Company’s refusal or failure to make the Severance Payment to which you become entitled under this Agreement, as a result of the
Company’s contesting the validity, enforceability or interpretation of this Agreement or of your right to benefits hereunder, or with regard to any Dispute (as 

  

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defined in Section 2.3(b)). You shall be conclusively presumed to have acted in good faith unless a court makes a final determination not otherwise
subject to appeal to the contrary. 
 ARTICLE VI 
 ARBITRATION 
 Except as otherwise provided in Section 2.3, you shall have the right and option (but not the obligation)
to elect (in lieu of litigation) to have any dispute or controversy arising under or in connection with this Agreement not otherwise resolved through the claims procedure set forth in Section 7.12, including any dispute under Section 2.3,
settled by arbitration, conducted before a panel of three arbitrators sitting in a location selected by you within fifty (50) miles from the location of your job with the Employer immediately prior to the Change in Control (determined without
regard to any relocation thereof which constitutes an Enumerated Event), in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the award of the arbitrator in any court having jurisdiction.
All expenses of such arbitration, including the fees and expenses of your counsel, shall be borne, and paid as incurred, by the Company; provided that the Company shall only be required to pay your fees and expenses if they are incurred in good
faith. You shall be conclusively presumed to have acted in good faith unless and until the arbitrator makes a final determination to the contrary. Notwithstanding any provision of this Agreement to the contrary, you shall be entitled to seek
specific performance of your right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement. 
 ARTICLE VII 
 MISCELLANEOUS 
  

	7.1	Applicable Law 

 To the extent not preempted by the laws of the United
States and in the interest of interpreting this Agreement in a uniform manner with other similar agreements being entered into by the Company with other of its and its Subsidiaries’ and Affiliates’ employees regardless of the jurisdiction
in which you are employed or any other factor, the laws of the State of Illinois shall be the controlling law in all matters relating to this Agreement, regardless of the choice-of-law rules of the State of Illinois or any other jurisdiction.

  

	7.2	Construction 

 No term or provision of this Agreement shall be construed so
as to require the commission of any act contrary to law, and wherever there is any conflict between any provision of this Agreement and any present or future statute, law, ordinance, or 

  

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regulation contrary to which the parties have no legal right to contract, the latter shall prevail, but in such event the affected provision of this
Agreement affected shall be curtailed and limited only to the extent necessary to bring such provision within the requirements of the law. 
  

	7.3	Severability 

 If a provision of this Agreement shall be held illegal or
invalid, the illegality or invalidity shall not affect the remaining parts of this Agreement and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included. 
  

	7.4	Headings 

 The Section headings in this Agreement are inserted only as a
matter of convenience, and in no way define, limit, or extend or interpret the scope of this Agreement or of any particular Section. 
  

	7.5	Termination Procedures and Compensation During Dispute 

 (a) Notice of Termination. After a Change in Control and during the Term, any purported termination of your employment (other than by reason of death) shall be communicated by a written Notice of Termination from the Employer to you
or by you to the Employer in accordance with Section 7.10 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied
upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of your employment under the provision so indicated. Further, a Notice of Termination for Just Cause is required to include a copy
of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership of the board of directors of the Employer at a meeting of such board of directors which was called and held for the purpose of
considering such termination (after reasonable notice to you and an opportunity for you, together with your counsel, to be heard before such board of directors) finding that, in the good faith opinion of such board of directors, you were guilty of
conduct set forth in clause (a) or (b) of the definition of Just Cause herein, and specifying the particulars thereof in detail. 
 (b) Date of Termination. “Date of Termination,” with respect to any purported termination of your employment after a Change in Control and during the Term, shall mean (i) if your employment is terminated for
Disability, thirty (30) days after Notice of Termination is given (provided that you shall not have returned to the full-time performance of your duties during such thirty (30) day period), and (ii) if your employment is terminated
for any other reason, the date specified in the Notice of Termination (which, in the case of a termination by the Company, shall not be less than thirty (30) days (except in the case of a 

  

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termination for Just Cause) and, in the case of a termination by you, shall not be less than fifteen (15) days nor more than sixty (60) days,
respectively, from the date such Notice of Termination is given). 
 (c) Dispute Concerning Termination. If within fifteen
(15) days after any Notice of Termination is given, or, if later, prior to the Date of Termination (as determined without regard to this Section 7.5(c)), the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, the Date of Termination shall be extended until the earlier of (i) the date on which the Term ends or (ii) the date on which the dispute is finally resolved, either by mutual written agreement of
the parties or by a final judgment, order or decree of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected); provided,
however, that the Date of Termination shall be extended by a notice of dispute given by you only if such notice is given in good faith and you pursue the resolution of such dispute with reasonable diligence. 
 (d) Compensation During Dispute. If a purported termination occurs following a Change in Control and during the Term and the Date of Termination is
extended in accordance with Section 7.5(c) hereof, the Company shall continue to pay you the full compensation in effect when the notice giving rise to the dispute was given (including, but not limited to, salary) and continue you as a
participant in all compensation, benefit and insurance plans in which you were participating when the notice giving rise to the dispute was given, until the Date of Termination, as determined in accordance with Section 7.5(c) hereof. Amounts
paid under this Section 7.5(d) are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement. 
  

	7.6	Assignability 

 Neither this Agreement nor any right or interest therein
shall be assignable or transferable (whether by pledge, grant of a security interest, or otherwise) by you, your beneficiaries or legal representatives, except by will or by the laws of descent and distribution. This Agreement shall be binding upon
and shall inure to the benefit of the Company, its successors and assigns, and you and shall be enforceable by them and your legal personal representatives. 
  

	7.7	Entire Agreement 

 This Agreement constitutes the entire agreement between
the Company and you regarding the subject matter hereof and supersedes all prior agreements, if any, understandings and arrangements, written or oral, between the Company and you with respect to the subject matter hereof. 
  

 14 

	7.8	Term 

 The term of this Agreement (the “Term”) shall commence on
the date hereof and shall continue in effect through December 31, 2003; provided, however, that commencing on January 1, 2003 and each January 1 thereafter, the Term shall automatically be extended for one additional year unless, not
later than September 30 of the preceding year, the Company or you shall have given notice not to extend the Term; and further provided, however, that if a Change in Control shall have occurred during the Term, the Term shall expire no earlier
than twenty-four (24) months beyond the month in which such Change in Control occurred. If you become entitled to Severance Payments hereunder, this Agreement shall continue and be effective until you (or the person(s) specified in
Section 2.5) shall have received in full all Severance Payments and other benefits to which you are entitled under this Agreement, at which time this Agreement shall terminate for all purposes. 
  

	7.9	Amendment 

 No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and the Company. No waiver by the Company or you at any time of any breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or any prior or subsequent time. No agreement or representations, written or oral, express or implied, with
respect to the subject matter hereof, have been made by either party which are not expressly set forth in this Agreement. 
  

	7.10	Notices 

 For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to have been duly given when personally delivered or sent by certified mail, return receipt requested, postage prepaid, addressed to the respective addresses last given by
each party to the other, provided that all notices to the Company or the Employer shall be directed to the attention of the Board of Directors with a copy to the General Counsel of the Company. All notices and communications shall be deemed to have
been received on the date of delivery thereof or on the third business day after the mailing thereof, except that notice of change of address shall be effective only upon actual receipt. No objection to the method of delivery may be made if the
written notice or other communication is actually received. 
  

	7.11	Administration 

 The Company has entered into agreements similar to this
Agreement herein with other employees of the Company and its Subsidiaries and Affiliates. These agreements, taken together, constitute a welfare benefit plan within the meaning of Section 3(1) of ERISA. The Administrator of such plan, within
the meaning of Section 3(16) of ERISA, and the Named Fiduciary thereof, within the meaning of Section 402 of ERISA, is the Company. 
  

 15 

	7.12	Claims 

 If you believe you are entitled to a benefit under this Agreement,
you may make a claim for such benefit by filing with the Company a written statement setting forth the amount and type of payment so claimed. The statement shall also set forth the facts supporting the claim. The claim may be filed by mailing or
delivering it to the Secretary of the Company. Within 90 calendar days after receipt of such a claim, the Company shall notify you in writing of its action on such claim and if such claim is not allowed in full, shall state the following in a manner
calculated to be understood by you: 
 (a) The specific reason or reasons for the denial; 
 (b) Specific reference to pertinent provisions of this Agreement on which the denial is based; 
 (c) A description of any additional material or information necessary for you to be entitled to the benefits that have been denied and an explanation of
why such material or information is necessary; and 
 (d) An explanation of this Agreement’s claim review procedure. 
 If you disagree with the action taken by the Company, you or your duly authorized representative may apply to the Company for a review of such action. Such application
shall be made within 60 calendar days after receipt by you of the notice of the Company’s action on your claim. The application for review shall be filed in the same manner as the claim for benefits. In connection with such review, you may
inspect any documents or records pertinent to the matter and may submit issues and comments in writing to the Company. A decision by the Company shall be communicated to you within 60 calendar days after receipt of the application (unless special
circumstances require an extension of time, but in no event more than 120 days after such receipt). The decision on review shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by
you, and specific references to the pertinent provisions of this Agreement on which the decision is based. 
  

	7.13	Individual Severance Agreement 

 This Agreement constitutes an individual
severance agreement for purposes of the Company’s Severance Plan (the “Severance Plan”). Accordingly, you will not be eligible to receive any severance payments or other benefits under the Severance Plan. 
  

 16 

 If this Agreement is acceptable to you, please sign the enclosed copy of this Agreement in the space provided below and
return it to me. 
 Sincerely, 
 Richard C. Vie 
 Chairman of the Board, President and CEO 
  

			
	ACCEPTED AND AGREED TO:
		
	By:	 	  
		 	

  

 17Unitrin, Inc. Severance plan

 EXHIBIT 10.12 
 UNITRIN, INC. 
 SEVERANCE PLAN 
 Unitrin, Inc. (the “Company”) hereby adopts, effective January 1, 2002, the Unitrin, Inc. Severance Plan (the
“Plan”) for the benefit of certain employees of the Company and its Subsidiaries and Affiliates, on the terms and conditions hereinafter stated. 
 The Plan, as set forth herein, is intended to help retain qualified employees, maintain a stable work environment and provide economic security to certain employees of the Company and its Subsidiaries and Affiliates
in the event of a Qualifying Termination following a Change in Control. 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” set forth under 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, (S) 2510.3-2(b). 
  

	Section	1. DEFINITIONS. As hereinafter used: 

 1.1
“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of the Exchange Act. 
 1.2
“Annual Compensation” shall mean: 
 (a) with respect to a Severed Employee who was a salaried employee
immediately prior to his or her Qualifying Termination, such Severed Employee’s rate of annual base salary as in effect immediately prior to such Severed Employee’s Qualifying Termination, without regard to any decrease in such salary
constituting Good Reason; 
 (b) with respect to a Severed Employee who was compensated primarily based on commissions
immediately prior to his or her Qualifying Termination, the total commissions earned by such Severed Employee with respect to the 12 full calendar month period ending immediately prior to such Severed Employee’s Qualifying Termination, without
regard to any decrease in the rate of such commissions constituting Good Reason; 
 (c) with respect to a Severed Employee who
was compensated based on an hourly rate of pay immediately prior to his or her Qualifying Termination, the total hourly wages earned by such Severed Employee with respect to the 12 full calendar month period ending immediately prior to such Severed
Employee’s Qualifying Termination, without regard to any decrease in the Severed Employee’s hourly rate of pay constituting Good Reason; 

 1.3 “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange
Act. 
 1.4 “Board” shall mean the Board of Directors of the Company, or any successor thereto. 
 1.5 “Cause” shall mean, with respect to a termination of the Employee’s employment with the Employer, (a) fraud,
misappropriation of or intentional material damage to the property or business of the Company (including its Subsidiaries and Affiliates), which in any such case is materially injurious to the Company (including its Subsidiaries and Affiliates),
monetarily or otherwise, or (b) the conviction of the Employee for the commission of a felony. 
 1.6 A “Change in
Control” shall be deemed to have occurred if the event set forth in any one of the following paragraphs shall have occurred: 
 (a) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the
Company or any of its Subsidiaries or Affiliates) representing 25% or more of the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction
described in clause (i) of paragraph (c) below; or 
 (b) the following individuals cease for any reason to constitute a
majority of the number of directors then serving: individuals who, on the date hereof, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest
relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s shareholders was approved or recommended by a vote of at least two-thirds of the directors then still
in office who either were directors on the date hereof or whose appointment, election or nomination for election was previously so approved or recommended; or 
 (c) there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other
corporation, other than (i) a merger or consolidation which results in the directors of the Company immediately prior to such merger or consolidation continuing to constitute at least a majority of the board of directors of the Company, the
surviving entity or any parent thereof or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or any of its Subsidiaries or Affiliates) representing 25% or more of the combined voting power of the
Company’s then outstanding securities; or 
  

 2 

 (d) the shareholders of the Company approve a plan of complete liquidation or dissolution
of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the
Company’s assets immediately following which the individuals who comprise the Board immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed or any parent
thereof. 
 1.7 “Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time. 
 1.8 “Disability” shall mean a physical or mental condition entitling the Employee to benefits under the applicable long-term disability
plan of the Company or any of its Subsidiaries or Affiliates, or if no such plan exists, causing the Employee to be unable to substantially perform his or her duties with the Employer for at least 6 months in any 12-month period. 
 1.9 “Employee” shall mean any person who is employed by the Employer on a full-time basis and whose compensation is reported on a Form
W-2. For purposes of this Plan, an Employee shall be considered to continue to be employed by the Employer on a full-time basis during sick leave, military leave or any other leave of absence approved by the Employer. 
 1.10 The “Employer” of an Employee shall mean the Company or any Subsidiary or Affiliate of the Company by which such Employee is
employed. 
 1.11 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to
time. 
 1.12 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
 1.13 “Good Reason” shall mean the occurrence of any one or more of the following events without the Employee’s express written
consent: 
 (a) a reduction in the Employee’s base salary, commission rate or hourly rate of pay, as applicable, as in
effect immediately prior to the Change in Control, or a material reduction in the compensation and benefit plans, arrangements, policies and procedures, taken as a whole, provided to the Employee from those, taken as a whole, provided to the
Employee immediately prior to the Change in Control; 
 (b) a material reduction in the Employee’s job authority and
responsibility; 
 (c) the Employer requires the Employee to change the location of his or her job or office, so that he or
she will be based at a location more than thirty miles from the location of his or her job or office immediately prior to the Change in Control; or 
  

 3 

 (d) a successor company fails or refuses to assume the Company’s obligations under
this Plan, as required by Section 5.4 hereof (and for purposes of a termination of an Employee’s employment for Good Reason as described in this subsection (d), the date on which any such succession becomes effective shall be deemed the
Employee’s Severance Date). 
 1.14 “Level I Employee” shall mean any Employee who is primarily compensated by
commissions with at least three continuous years of service with the Employer as of the date of such Employee’s Qualifying Termination. 
 1.15 “Level II Employee” shall mean any Employee who is not primarily compensated by commissions and whose Annual Compensation is greater than $150,000. 
 1.16 “Level III Employee” shall mean any Employee who is not primarily compensated by commissions and whose Annual Compensation is at
least $100,000 and not more than $150,000. 
 1.17 “Level IV Employee” shall mean any Employee who is not primarily
compensated by commissions and whose Annual Compensation is at least $50,000 and less than $100,000. 
 1.18 “Level V
Employee” shall mean any Employee who is not primarily compensated by commissions and whose Annual Compensation is less than $50,000. 
 1.19 “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (a) the Company or any of its
Subsidiaries or Affiliates, (b) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries or Affiliates, (c) an underwriter temporarily holding securities pursuant to an offering of
such securities, (d) a corporation owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of stock of the Company, (e) any individual, entity or group whose ownership of
securities of the Company is reported on Schedule 13G pursuant to Rule 13d-1 promulgated under the Exchange Act (but only for so long as such ownership is so reported) or (f) Singleton Group LLC or any successor in interest to such entity.

 1.20 “Plan Administrator” shall mean the committee appointed to administer the Plan. Such committee shall be selected by
the Board. Following a Change in Control, a person may be appointed to such committee only by a two-thirds majority of the individuals who were members of the Board immediately prior to such Change in Control. 
 1.21 A “Potential Change in Control” shall be deemed to occur in the event that (a) the Company enters into an agreement, the
consummation of which would result in a Change in Control, (b) the Company or any Person publicly announces an 

  

 4 

 
intention to take or to consider taking action which, if consummated would constitute a Change in Control, (c) any Person becomes the Beneficial Owner,
directly or indirectly, of securities of the Company representing 15% or more of either the then outstanding shares of common stock of the Company or the combined voting power of the Company’s then outstanding securities (not including in the
securities beneficially owned by such Person any securities acquired directly from the Company or any of its Subsidiaries or Affiliates) or (d) the Board adopts a resolution to the effect that, for purposes of this Plan, a Potential Change in
Control has occurred. 
 1.22 “Qualifying Termination” shall mean a termination of an Employee’s employment during the
2-year period immediately following a Change in Control, either (a) by the Employer without Cause or (b) by the Employee for Good Reason. A termination of employment will not be deemed to have occurred upon (i) the transfer of the
Employee to employment with a Subsidiary or Affiliate of the Company or (ii) the divestiture of a business with which the Employee is primarily associated if the Employee is offered comparable employment by the successor company. 
 1.23 “Severance Benefits” shall mean the payments and benefits provided to Severed Employees pursuant to Sections 2.1, 2.2, and 2.3
hereof. 
 1.24 “Severance Date” shall mean the date on which an Employee incurs a Qualifying Termination. 
 1.25 “Severance Weeks” means, for each Employee, one week for (a) each full year such Employee has been continuously employed by the
Employer, plus (without duplication), if there has been a break in such Employee’s employment with the Employer, (b) each full year of employment for which such Employee has received credit under any retirement plan or program maintained
by the Employer for employment prior to such break, but in no event less than four (4) weeks or more than twenty six (26) weeks (thirteen (13) weeks in the case of a Level I Employee). For purposes of calculating an Employee’s full
years of employment, (x) any partial year of employment of at least thirty five (35) weeks shall count as a full year of employment and (y) employment at one Employer shall count (without duplication) toward the number of years of
employment at another Employer, provided that (i) there is no break (other than as the result of vacation or sick leave, military leave or other approved leave of absence) in the employment between the two Employers or (ii) such Employee
has received credit under any retirement plan or program maintained by the Employer for such years of employment prior to such break. 
 1.26
“Severed Employee” shall mean an Employee who has incurred a Qualifying Termination. 
 1.27 “Subsidiary”
shall mean any entity more than 50% of the voting securities of which are Beneficially Owned by the Company. 
 Additional definitions are
set forth within the Plan and shall have the meanings ascribed to them in the Plan. 
  

 5 

	Section	2. BENEFITS. 

 2.1 The Company shall pay (or shall
cause the Severed Employee’s Employer to pay) to each Severed Employee a severance payment (the “Severance Payment”) equal to: 
 (a) in the case of a Level I Employee, the product of (i) one-fifty-second (1/52) of his or her Annual Compensation and (ii) his or her Severance Weeks. 
 (b) in the case of a Level II Employee, one year’s Annual Compensation plus the product of (i) one-fifty-second (1/52) of
his or her Annual Compensation and (ii) his or her Severance Weeks. 
 (c) in the case of a Level III Employee,
thirty-five-fifty seconds (35/52) of his or her Annual Compensation plus the product of (i) one-fifty-second (1/52) of his or her Annual Compensation and (ii) his or her Severance Weeks. 
 (d) in the case of a Level IV Employee, seventeen-fifty seconds (17/52) of his or her Annual Compensation plus the product of
(i) one-fifty-second (1/52) of his or her Annual Compensation and (ii) his or her Severance Weeks. 
 (e) in
the case of a Level V Employee, the product of (i) one-fifty-second (1/52) of his or her Annual Compensation and (ii) his or her Severance Weeks. 
 The Severance Payment shall be paid to such Severed Employee in a lump sum as soon as practicable following the Severed Employee’s Qualifying Termination. The Severance Payment that a Severed Employee receives under this Plan shall not
be taken into account for purposes of determining benefits under any other qualified or nonqualified plans of the Employer. 
 2.2 For a
period equal to a number of weeks (not to exceed fifty-two (52) in total) equal to the sum of (i) the Severed Employee’s Severance Weeks and (ii) in the case of (a) Level I Employees, eight (8) weeks, (b) Level II
and III Employees, fifty-two (52) weeks, (c) Level IV Employees, thirty-five (35) weeks, and (d) Level V Employees, seventeen (17) weeks (the “Welfare Benefit Continuation Period”), the Company shall provide (or
shall cause the Severed Employee’s Employer to provide) the Severed Employee and anyone entitled to claim under or through such Severed Employee with all Employer-provided benefits under any group health plan (including any dental coverage) and
life insurance plan of the Employer (as in effect immediately prior to such Severed Employee’s Severance Date or, if more favorable to the Severed Employee, immediately prior to the Change in Control) for which employees of the Employer are
eligible, to the same extent as if such Severed Employee had continued to be an employee of the Employer during the Welfare Benefit Continuation Period, at no greater cost to the Severed Employee than the cost to the Severed Employee immediately
prior to such date. 

  

 6 

 
To the extent that the Severed Employee’s participation in Employer benefit plans is not practicable, the Company shall arrange to provide, at the
Company’s sole expense, the Severed Employee and anyone entitled to claim under or through such Severed Employee with equivalent health and life insurance benefits under an alternative arrangement during the Welfare Benefit Continuation Period.
The coverage period for purposes of the group health continuation requirements of Section 4980B of the Code shall commence at the expiration of the Welfare Benefit Continuation Period. The benefits described in this Section 2.2 shall end
as of the date the Severed Employee becomes covered under any group health plan maintained by a subsequent employer which provides benefits to the Severed Employee (and anyone entitled to claim the benefits described in this Section 2.2 under
or through such Severed Employee) not materially less favorable than the benefits described in this Section 2.2, and which does not exclude any pre-existing condition that the Severed Employee or his or her dependents may have at that time.

 2.3 Outplacement. 
 (a) Each Level II and III Employee who is entitled to receive a Severance Payment under Section 2.1 shall also be entitled to receive outplacement services consisting of counseling, networking, spousal programs
and the use of a private office. Such outplacement services will be provided for a maximum of thirty-nine (39) weeks by a reputable organization selected by the Company. These outplacement services will be paid for by the Company. 

(b) Each Level IV Employee who is entitled to receive a Severance Payment under Section 2.1 shall also be entitled to receive
outplacement services consisting of counseling, group workshops and the use of a semi-private office. Such outplacement services will be provided for a maximum of twenty-six (26) weeks by a reputable organization selected by the Company. These
outplacement services will be paid for by the Company. 
 (c) Each other Employee who is entitled to receive a Severance
Payment under Section 2.1 shall also be entitled to receive outplacement services consisting of group workshops, resume writing assistance and help-line support. Such outplacement services will be provided for a maximum of eight (8) weeks
by a reputable organization selected by the Company. These outplacement services will be paid for by the Company. 
 2.4 In the event of a
claim by an Employee as to the amount or timing of any payment or benefit under the Plan, such Employee shall present the reason for his or her claim in writing to the Plan Administrator. The Plan Administrator shall, within 90 days after receipt of
such written claim, send a written notification to the Employee as to its disposition. In the event the claim is wholly or partially denied, such 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 or her 

  

 7 

 
claim. In the event an Employee wishes to appeal the denial of his or her claim, he or she may request a review of such denial by making application in
writing to the Plan Administrator within 60 days after receipt of such denial. Such Employee (or his or her duly authorized legal representative) may, upon written request to the Plan Administrator, review any documents pertinent to his or her
claim, and submit in writing issues and comments in support of his or her position. Within 60 days after receipt of a written appeal (unless special circumstances 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. 
 2.5 Any further dispute or controversy arising under or in
connection with this Plan with respect to an Employee shall be settled exclusively by arbitration at a location within fifty miles from the location of such Employee’s job with an Employer immediately prior to the Change in Control (determined
without regard to any relocation thereof which constitutes Good Reason) in accordance with the rules of the American Arbitration Association then in effect; provided, however, that the evidentiary standards set forth in this Agreement
shall apply. Judgment may be entered on the award of the arbitrator in any court having jurisdiction. Each party shall bear its own expenses of such arbitration. 
  

	 	2.6	Cap. 

 (a) Notwithstanding any other
provision of this Plan, in the event that any payment or benefit received or to be received by the Employee in connection with a Change in Control or the termination of the Employee’s employment (whether pursuant to the terms of this Agreement
or any other plan, arrangement or agreement with the Company, any Person whose actions result in a Change in Control or any Person Affiliated with the Company or such Person) (all such payments and benefits, including the Severance Benefits, being
hereinafter called “Total Payments”) would not be deductible (in whole or part), by the Company, Affiliate or Person making such payment or providing such benefit as a result of Section 280G of the Code, then, to the extent
necessary to make such portion of the Total Payments deductible (and after taking into account any reduction in the Total Payments provided by reason of Section 280G of the Code in such other plan, arrangement or agreement), the cash Severance
Payments shall first be reduced (if necessary, to zero), and all other Severance Payments shall thereafter be reduced (if necessary, to zero); provided, however, that the Employee may elect to have the noncash Severance Payments
reduced (or eliminated) prior to any reduction of the cash Severance Payments. 
 (b) For purposes of this limitation,
(i) no portion of the Total Payments the receipt or enjoyment of which the Employee shall have waived at such time and in such manner as not to constitute a “payment” within the meaning of Section 280G(b) of the Code shall be
taken into account, (ii) no portion of the Total Payments shall be taken into account which, in the opinion of tax counsel 

  

 8 

 
(“Tax Counsel”) reasonably acceptable to the Employee and selected by the accounting firm which was, immediately prior to the Change in
Control, the Company’s independent auditor (the “Auditor”), does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code, including by reason of Section 280G(b)(4)(A) of the
Code, (iii) the Severance Benefits shall be reduced only to the extent necessary so that the Total Payments (other than those referred to in clauses (i) or (ii)) in their entirety constitute reasonable compensation for services actually
rendered within the meaning of Section 280G(b)(4)(B) of the Code or are otherwise not subject to disallowance as deductions by reason of Section 280G of the Code, in the opinion of Tax Counsel, and (iv) the value of any noncash
benefit or any deferred payment or benefit included in the Total Payments shall be determined by the Auditor in accordance with the principles of Sections 280G(d)(3) and (4) of the Code. 
 (c) If it is established pursuant to a final determination of a court or an Internal Revenue Service proceeding that, notwithstanding the
good faith of the Employee and the Company in applying the terms of this Section 2.6, the Total Payments paid to or for the Employee’s benefit are in an amount that would result in any portion of such Total Payments being subject to the
Excise Tax, then, if such repayment would result in (i) no portion of the remaining Total Payments being subject to the Excise Tax and (ii) a dollar-for-dollar reduction in the Employee’s taxable income and wages for purposes of federal,
state and local income and employment taxes, the Employee shall have an obligation to pay the Company upon demand an amount equal to the sum of (i) the excess of the Total Payments paid to or for the Employee’s benefit over the Total
Payments that could have been paid to or for the Employee’s benefit without any portion of such Total Payments being subject to the Excise Tax; and (ii) interest on the amount set forth in clause (i) of this sentence at the rate
provided in Section 1274(b)(2)(B) of the Code from the date of the Employee’s receipt of such excess until the date of such payment. 
  

	Section	3. PLAN ADMINISTRATION. 

 3.1 The Plan shall be
interpreted, administered and operated by the Plan Administrator, which shall have complete authority, in its sole discretion subject to the express provisions of the Plan, to determine who shall be eligible for Severance Benefits, to interpret the
Plan, to prescribe, amend and rescind rules and regulations relating to it, and to make all other determinations necessary or advisable for the administration of the Plan. 
 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 by the Plan Administrator in an equitable and fair manner in accordance with the procedure for claims and appeals described in Section 2.4 hereof. 
 3.3 The Plan Administrator may delegate any of its duties hereunder to such person or persons from time to time as it may designate. 
  

 9 

 3.4 The Plan Administrator is empowered, on behalf of the Plan, to engage accountants, legal counsel and
such other personnel as it deems necessary or advisable to assist it in the performance of its duties under the Plan. The functions of any such persons engaged by the Plan Administrator shall be limited to the specified services and duties for which
they are engaged, and such persons shall have no other duties, obligations or responsibilities under the Plan. Such persons shall exercise no discretionary authority or discretionary control respecting the management of the Plan. All reasonable
expenses thereof shall be borne by the Company. 
  

	Section	4. PLAN MODIFICATION OR TERMINATION. 

 The Plan may
be amended by the Plan Administrator or terminated by the Board at any time; provided, however, that (a) no termination or amendment of the Plan may reduce the Severance Benefits to be paid or provided under the Plan to an
Employee if the Employee’s termination of employment with the Employer has occurred prior to such termination of the Plan or amendment of its provisions and (b) during the pendency of a Potential Change in Control and during the two-year
period following a Change in Control, the Plan may not be terminated or amended, if such amendment would be adverse to the interests of any Employee or his or her beneficiary, without the consent of such Employee or beneficiary. 
  

	Section	5. GENERAL PROVISIONS. 

 5.1 Except as otherwise
provided herein or by law, none of the payments, benefits or rights of any Employee shall be subject to any claim of any creditor, and, in particular, to the fullest extent permitted by law, all such payments, benefits and rights shall be free from
attachment, garnishment, trustee’s process, or any other legal or equitable process available to any creditor of such Employee. No Employee shall have the right to alienate, anticipate, commute, pledge, encumber or assign any of the benefits or
payments which he or she may expect to receive, contingently or otherwise, under this Plan. 
 5.2 Neither the establishment of the Plan, nor
any modification thereof, nor the creation of any fund, trust or account, nor the payment of any benefits shall be construed as giving any Employee, or any person whomsoever, the right to be retained in the service of the Employer, and all Employees
shall remain subject to discharge to the same extent as if the Plan had never been adopted. 
 5.3 If any provision of this Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and enforced as if such provisions had not been included. 
 5.4 The Company shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Company, expressly and unconditionally to 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 if no such succession or 

  

 10 

 
assignment had taken place. In such event, the term “Company,” as used in this Plan, shall mean the Company as herein before defined and any
successor or assignee to the business or assets which by reason hereof becomes bound by the terms and provisions of this plan. 
 5.5 The
headings and captions herein are provided for reference and convenience only, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan. 
 5.6 The Plan shall not be funded. No Employee shall have any right to, or interest in, any assets of the Company which may be applied by the Company to
the payment of benefits or other rights under this Plan. 
 5.7 Any benefit payable to or for the benefit of a minor, an incompetent person
or other person incapable of giving a receipt therefor shall be deemed paid when paid to such person’s guardian or to the party providing or reasonably appearing to provide for the care of such person, and such payment shall fully discharge the
Company, the Plan Administrator and all other parties with respect thereto. If a Severed Employee dies prior to the payment of all benefits due such Severed Employee, such unpaid amounts shall be paid to the executor, personal representative or
estate of such Employee. 
 5.8 The Severance Benefits that a Severed Employee may be entitled to receive pursuant to this Plan are not
intended to be duplicative of any similar benefits to which a Severed Employee may be entitled from the Company or any of its Subsidiaries or Affiliates under any other severance plan, agreement, policy or program maintained by the Company or any of
its Subsidiaries or Affiliates or to which the Company or any of its Subsidiaries or Affiliates is a party. Accordingly, the Company shall reduce the benefits to which a Severed Employee may be entitled under this Plan to take account of any other
similar benefits to which the Severed Employee is entitled from the Company or any of its Subsidiaries or Affiliates; provided, however, that if the amount of benefits to which such Severed Employee is entitled under such other severance plan,
agreement, policy or program is greater than the benefits to which the Severed Employee is entitled under this Plan, the Severed Employee will be entitled to receive the full amount of the benefits to which such Employee is entitled under such other
plan, agreement, policy or program. 
 5.9 Any notice or other communication required or permitted pursuant to the terms hereof shall have
been duly given when delivered or mailed by United States mail, first class, postage prepaid, addressed to the intended recipient at his, her or its last known address. 
 5.10 This Plan shall be construed and enforced according to the laws of the State of Illinois, without giving effect to its principles of conflicts of law, to the extent not preempted by federal law, which shall
otherwise control. 
  

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