Document:

exv10wxky

 

Exhibit 10(k)

CERNER CORPORATION EXECUTIVE DEFERRED

COMPENSATION PLAN

ARTICLE I

RESTATEMENT AND PURPOSE OF PLAN

          1.1 Plan Restatement. Cerner Corporation, a Delaware corporation, originally
established the Cerner Corporation Executive Deferred Compensation Plan effective August 1, 1999.
Pursuant to certain changes required by the American Jobs Creation Act of 2004 that relate to
nonqualified deferred compensation arrangements, Cerner hereby amends and restates this Plan
effective as of January 1, 2008.

          1.2 Purpose of Plan. The purpose of the Plan is to provide deferred compensation
benefits to certain Associates of Cerner who are members of a select group of management or highly
compensated Associates.

ARTICLE II

DEFINITIONS

          2.01 Account shall mean a memorandum account maintained by the Company for bookkeeping
purposes only, to which is credited or debited, as appropriate, the amount of an Executive’s
Deferral Contributions, Company Contributions (if any), Investment Return, forfeitures and
distributions.

          2.02 Associate shall mean an employee of the Company.

          2.03 Change of Control Event means the first to occur of any of the following:

          (a) Any one person, or more than one person acting as a group (as defined below) acquires
ownership of stock of the Company that, together with stock held by such person or group,
constitutes more than 50 percent of the total fair market value or total voting power of the stock
of the Company.

          (b) Either: (i) any one person, or more than one person acting as a group (as defined below),
acquires (or has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of the Company possessing 35 percent or
more of the total voting power of the stock of the Company; or (ii) a majority of members of the
Company’s board of directors is replaced during any 12-month period by directors whose appointment
or election is not endorsed by a majority of the members of the Company’s board of directors prior
to the date of the appointment or election.

          (c) Any one person, or more than one person acting as a group (as defined below), acquires (or
has acquired during the 12-month period ending on the date of the most

 

 

recent acquisition by such person or persons) assets from the Company that have a total gross
fair market value (“gross fair market value” means the value of the assets of the Company, or the
value of the assets being disposed of, determined without regard to any liabilities associated with
such assets) equal to or more than 40 percent of the total gross fair market value of all of the
assets of the Company immediately prior to such acquisition or acquisitions.

          (d) For purposes of this definition, persons will not be considered to be acting as a group
solely because they purchase or own stock, or purchase assets, of the same corporation at the same
time, or as a result of the same public offering. However, persons will be considered to be acting
as a group if they are owners of a corporation that enters into a merger, consolidation, purchase
or acquisition of stock or assets, or similar business transaction with the corporation. If a
person, including an entity or entity shareholder, owns stock in both corporations that enter into
a merger, consolidation, purchase or acquisition of stock or assets, or similar transaction, such
shareholder is considered to be acting as a group with other shareholders in a corporation (only
with respect to the ownership in that corporation in the case of an event described above in
paragraph (b) or only to the extent of the ownership in that corporation in the case of an event
described above in paragraph (c) prior to the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.

          2.04 Code shall mean the Internal Revenue Code of 1986 as from time to time amended.

          2.05 Committee shall mean the Committee selected by the Company to be responsible for
administering and interpreting the Plan as provided in Article X.

          2.06 Company shall mean Cerner Corporation.

          2.07 Company Contributions shall mean Performance Contributions (if any), Discretionary
Contributions (if any) and Matching Contributions (if any).

          2.08 Compensation shall mean the total salary, bonus and commissions payable to an Executive
by the Company in a given Year. Compensation shall include Deferral Contributions under the Plan
and shall include salary deferral contributions made to a retirement plan of the Employer intended
to qualify under Section 401(k) of the Code.

          2.09 Deferral Contribution shall mean the amount credited to an Executive’s Account for a
particular Year pursuant to the voluntary deferral election of the Executive.

          2.10 Designated Beneficiary shall mean the individual, individuals, trust or estate identified
by an Executive to receive any benefits payable hereunder on account of the death of the Executive.
Each such designation shall revoke any prior designation executed by the Executive. If no
beneficiary is effectively designated, then the Designated Beneficiary shall be the Executive’s
surviving spouse, but if there is no surviving spouse then the Designated Beneficiary shall be the
personal representatives of the Executive’s estate.

 

 

          2.11 Discretionary Contribution shall mean the amount, if any, allocated by the Company to an
Executive’s Account pursuant to Section 5.2.

          2.12 ERISA shall mean the Employee Retirement Income Security Act of 1974, as from time to
time amended.

          2.13 Executive shall mean an Associate who satisfies the requirements for participation in the
Plan under Article III and for whom an Account is maintained.

          2.14 Investment Election shall mean the election made by the Executive from time to time as
provided in Article VI which shall be used for purposes of crediting or debiting, as applicable, of
the Investment Return to the Executive’s Account.

          2.15 Investment Return shall mean the hypothetical investment return, which may include
earnings and losses, on the amounts credited to an Executive’s Account as determined under Article
VI.

          2.16 Matching Contributions shall mean the amount allocated to an Executive’s Account pursuant
to Section 5.1.

          2.17 Participation Agreement shall mean an agreement executed by an Executive by which the
Executive acknowledges acceptance of the terms and conditions of the Plan.

          2.18 Performance Contribution shall mean the amount, if any, allocated to an Executive’s
Account pursuant to Section 5.3.

          2.19 Permanent Disability shall mean an Executive: (a) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period of not less than 12
months, or (b) is, by reason of any medically determinable physical or mental impairment which can
be expected to result in death or can be expected to last for a continuous period of not less than
12 months, receiving income replacement benefits for a period of not less than three months under a
Company-sponsored accident or health plan covering Associates.

          2.20 Plan shall mean the Cerner Corporation Executive Deferred Compensation Plan as contained
herein and as from time to time amended.

          2.21 Separation from Service means an Executive’s death, retirement or other termination of
employment with the Company. A Separation from Service shall not occur if the Executive is on
military leave, sick leave or other bona fide leave of absence (such as temporary employment by the
government) if the period of such leave does not exceed six months, or if longer, as long as the
Executive’s right to reemployment with the Company is provided either by statute or by contract.
“Separation from Service” shall be interpreted in a manner consistent with Code Section
409A(a)(2)(A)(i) and the applicable Treasury regulations issued thereunder.

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          2.22 Specified Associate means an Associate that would be a “specified employee” as defined in
Section 409A(a)(2)(B)(i) of the Code and Department of Treasury regulations and other interpretive
guidance issued thereunder.

          2.23 Termination of Employment shall have the same meaning as Separation from Service.

          2.24 Unforeseeable Emergency means a severe financial hardship to an Executive resulting from
an illness or accident of the Executive, the Executive’s spouse or a dependent (as defined in Code
Section 152) of the Executive, loss of the Executive’s property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result of events beyond the control of
the Executive.

          2.25 Year shall mean the calendar year.

ARTICLE III

PARTICIPATION

          3.1 Designation by Company. Prior to the first day of each Year the Company shall
designate certain Associates as eligible Executives to make Deferral Contributions hereunder for
such Year; provided, however, that if an Associate becomes employed by the Company after the first
day of a Year or receives a promotion after the first day of the Year such that the Associate meets
the criteria set forth in Section 3.2, then the Company may designate such Associate as an
Executive eligible to make Deferral Contributions hereunder at any time during such Year. In
addition, at any time the Company determines to make Company Contributions hereunder, the Company
shall designate certain Associates as Executives eligible for allocations of specific types of such
Company Contributions.

          3.2 Criteria for Designation. An Associate must be a member of a select group of
management or highly compensated Associates within the meaning of ERISA as determined by the
Company in order to be designated by the Company as an Executive eligible to make Deferral
Contributions under the Plan or as an Executive eligible for allocation of any Company
Contributions under the Plan.

ARTICLE IV

DEFERRAL CONTRIBUTIONS

          4.1 Time of Election.

          (a) Deferral Contributions. An Executive’s election to make Deferral Contributions with
respect to services performed in a particular Year must be made prior to the first day of such
Year; provided, however, that if an Associate not previously eligible to make Deferral
Contributions is designated during a Year as eligible to make Deferral Contributions for such Year
then such Associate’s election to make Deferral Contributions must be made within 30

 

 

days after the Associate is designated as an eligible Executive by the Company and such newly
eligible Associate’s deferral election shall relate only to compensation earned after the date such
election in made. An eligible Executive must make a new election with respect to each Year for
which the Executive elects to make Deferral Contributions. All elections made by an Executive are
revocable until 4:00 p.m. on the last business day of the calendar year before the calendar year
for which the deferral election relates. Except as provided below in Sections 4.3 and 4.4, after
4:00 p.m. on such date, all standing elections become irrevocable for such upcoming year.

          (b) Company Contributions. An Executive must make an election as to the form (e.g., lump sum
or installments) of payment(s) attributable to Company Contributions, if any, made during a
particular Year before the first day of the Year in which such Company Contribution will be
allocated to the Executive’s Account.

          4.2 Method of Election. An election by an Executive to make Deferral Contributions
hereunder shall be made in writing on a form furnished by the Committee and shall be delivered to
the Committee prior to 4:00 p.m. on the last business day of the Year preceding the Year for which
the election relates, or, in the case of an Executive who first becomes eligible to make Deferral
Contributions during the Year, within 30 days after the associate first becomes eligible and prior
to the day such election is first effective.

          4.3 Change or Termination of Election. Once an election for Deferral Contributions
for a particular Year becomes irrevocable pursuant to Section 4.1, the Executive cannot change the
election to a greater or lesser amount during such Year nor can the Executive terminate the
election for a particular Year at any time during such Year; provided, however, the Committee may
permit the Executive to terminate during a Year the Executive’s election to make Deferral
Contributions if the Committee determines that the Executive has an Unforeseeable Emergency
resulting in a financial need that can be met by the termination of Deferral Contributions. The
Committee may also permit the Executive to terminate during a Year the Executive’s election to make
Deferral Contributions if the Executive becomes eligible to receive a hardship distribution
pursuant to Treasury regulations 1.401(k)-1(d)(3). To the extent any election to make Deferral
Contributions is canceled as provided for under this Section 4.3, such election must be canceled,
and not postponed or otherwise delayed, such that any later deferral election will be subject to
the election timing rules set forth above in Section 4.1.

          4.4 Mandatory Termination of Deferral Contributions. If a distribution is made to an
Executive on account of an Unforeseeable Emergency as provided in Section 8.3, then the Executive’s
current election (if any) to make Deferral Contributions shall terminate at the time of such
distribution, and the Executive may make no Deferral Contributions for the duration of the Year in
which such distribution is made.

          4.5 Default Election. If, for any particular year, an Executive fails to designate
the time at which the Executive’s Deferral Contributions for such Year are to be distributed, the
Executive shall be deemed to have made an election to receive such Year’s Deferral Contributions on
the first business day following six months after Executive’s Separation from Service.

5

 

          4.6 409A Transition Election. An Executive may amend his or her current election
relating to both timing and form of payment for all Deferral Contributions before December 31, 2008
or before any later date permitted under final Treasury Regulations or other applicable guidance
under Code Section 409A. An Executive will not, however, be permitted to, and the Plan will not
recognize any election to, change a timing or form election that either: (1) applies to payments
the Executive would otherwise receive during the year of the change, or (2) causes a Plan benefit
to be paid during the year of the change.

ARTICLE V

COMPANY CONTRIBUTIONS

          5.1 Company Matching Contribution. The Company may in its sole and absolute
discretion direct the Committee to allocate a contribution from time to time to the Accounts of
those Executives who have made Deferral Contributions during the applicable period. The amount of
any such Matching Contribution, and the applicable period for which it is allocated, shall be
determined by the Company in its sole and absolute discretion.

          5.2 Company Discretionary Contribution. The Company may in its sole and absolute
discretion direct the Committee to allocate a contribution from time to time in any amount or
amounts it determines to the Account of any Executive. The amount of any such Discretionary
Contribution allocated to the Account of any particular Executive, and the Executive or Executives
to whose accounts such allocations are made, shall be determined by the Company in its sole and
absolute discretion, and need not be uniform for all Executives.

          5.3 Company Performance Contribution. The Company may in its sole and absolute
discretion direct the Committee to allocate a Performance Contribution in such amount as the
Company determines in its sole and absolute discretion to the Account of any Executive.

ARTICLE VI

INVESTMENT RETURN

          6.1 Adjustments to Account. An Executive’s Account shall be adjusted as of the last
day of each Year to reflect the Investment Return applicable to the Executive’s Account for such
Year as determined by the Company. Such adjustment may be a net credit to the Executive’s Account,
in the case of net investment gain, or a net debit to the Executive’s Account, in the case of net
investment loss. In addition to the annual adjustment hereunder, the Executive’s Account shall be
adjusted at such other time or times as the Company may determine.

          6.2 Determination of Investment Return. The amount of the applicable Investment
Return shall be determined based upon the Executive’s Investment Election; provided, however, that
the Investment Return applicable to Company Contributions (if any)

 

 

shall be determined as if all Company Contributions are invested in common stock of the Company.

          6.3 Investment Election. An Executive’s Investment Election shall be an election by
the Executive among certain investment options designated from time to time by the Company which
investment options shall include common stock of the Company. The Executive’s Investment Election
will be used solely for purposes of determining the Investment Return applicable to the Executive’s
Account and does not give the Executive any right to receive any particular asset. The Executive’s
Investment Election shall be in whole percentages among one or more of the investment options, and
shall be made on a form furnished by the Committee. An Executive may complete a new Investment
Election form at any time. The Executive’s Investment Election form shall be effective
prospectively only and only after it is received by the Committee.

ARTICLE VII

VESTING

          7.1 Deferral Contributions. An Executive shall be fully vested at all times in the
amount of Deferral Contributions credited to the Executive’s Account subject to any adjustments for
Investment Return.

          7.2 Matching Contributions and Discretionary Contributions. Subject to the
provisions of Section 7.4 and Section 7.5, the Matching Contribution, if any, allocated to an
Executive’s Account in a given Year, and the Discretionary Contribution, if any, allocated to an
Executive’s Account in a given Year, as adjusted for Investment Return applicable to each such
particular contribution for a particular Year, shall vest from the initial date of allocation to
the Executive’s Account in accordance with the following schedule:

	 	 	 	 	 
	Number of Full Years of Employment After	 	 
	Year of Allocation	 	Cumulative Percentage Vested
	1

	 	 	20	%
	2

	 	 	40	%
	3

	 	 	60	%
	4

	 	 	80	%
	5

	 	 	100	%

          7.3 Performance Contributions. Subject to the provisions of Section 7.4 and Section
7.5, the Performance Contribution, if any, allocated to an Executive’s Account in a given Year, as
adjusted for Investment Return applicable thereto, shall vest from the initial date of allocation
to the Executive’s Account in accordance with the following schedule:

	 	 	 	 	 
	Number of Full Years of Employment After	 	 
	Year of Allocation	 	Cumulative Percentage Vested
	1

	 	 	0	%
	2

	 	 	0	%
	3

	 	 	100	%

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          7.4 Forfeiture Upon Breach of Agreement. Notwithstanding the provisions of Section
7.2 and Section 7.3, if the Committee determines that an Executive has breached the provisions of
the employment agreement between the Executive and the Company (including, without limitation,
provisions regarding confidentiality, non-competition or non-solicitation), then all Company
Contributions allocated to the Executive’s Account and the Investment Return applicable to such
Company Contributions shall be forfeited in full immediately upon such determination of breach
effective as of the date of such breach.

          7.5 Full Vesting Upon Death. Notwithstanding the provisions of Section 7.2 and
Section 7.3, if an Executive dies while employed by the Company then the entire amount of the
Executive’s Account at the time of the Executive’s death and thereafter shall become fully vested.

ARTICLE VIII

DISTRIBUTIONS

          8.1 Method of Payment. The method of payment to an Executive shall be either a lump
sum cash distribution or a designated number of annual installments. The Executive shall elect a
method of payment upon commencement of participation in the Plan. The Executive may change such
election at the time the Executive makes a new voluntary deferral election, but, unless the change
constitutes a subsequent election made in accordance with Section 8.4, any such change shall apply
only to Deferral Contributions and Company Contributions thereafter made and the Investment Return
applicable to such contributions. To the extent that an Executive makes an election to receive his
or her payments in the form of installments, such series of installments shall at all times be
treated as the right to a series of separate payments.

          8.2 Time of Payment.

          (a) Deferral Contributions. Subject to Sections 8.2(c) and 8.2(e) below and any subsequent
election as provided for in Section 8.4, payment of an Executive’s benefit with respect to the
Executive’s Deferral Contributions and the Investment Return applicable to such contributions shall
be made (in the case of a lump sum payment) or shall commence (in the case of installment payments)
upon the earlier or later of the applicable event or calendar year as elected by the Executive at
the time the Executive elects to make such Deferral Contributions; provided, however, in no event
shall such payment with respect to any Deferral Contributions and the Investment Return applicable
to such contributions be made or commence earlier than the first to occur of: (i) three years after
the date of the Executive’s election to make such Deferral Contributions, or, (ii) the Executive’s
Termination of Employment with the Company. To maximize an Executive’s opportunity for Subsequent
Elections under Section 8.4 in accordance with IRC Section 409A, all payments of the Executive’s
Deferral Contributions and

 

 

the Investment Return applicable thereto which are scheduled to be made within a particular Year
shall be made on the last business day of such Year.

          (b) Company Contributions. Subject to any subsequent election as provided for in Section 8.4,
payment of an Executive’s vested benefit with respect to Company Contributions (if any) and the
Investment Return applicable to such contributions shall be made (in the case of a lump sum
payment) or shall commence (in the case of installment payments) as soon as practicable within 90
days after the last day of the Year containing the second anniversary of the Executive’s
Termination of Employment.

          (c) Delay for Specified Associate. If: (i) the Executive has made an election to receive
payment of his or her Deferral Contributions and Investment Return applicable to such contributions
upon the Executive’s Termination of Employment, and (ii) the Executive is a Specified Associate,
then notwithstanding such Executive’s election, payment of such amounts shall be made or commence
no earlier than the first business day following the six-month anniversary of the date of the
Executive’s Termination of Employment.

          (d) Payment upon Death or Permanent Disability. Notwithstanding the preceding provisions in
Section 8.2 (a) and (b), if an Executive terminates employment with the Company on account of death
or Permanent Disability, then payment of the Executive’s vested benefit shall be made (in the case
of a lump sum payment) or shall commence (in the case of installment payments) as soon as
practicable following the Company’s determination of the Executive’s Permanent Disability or death.

          (e) Delay to Preserve Deduction. Notwithstanding an Executive’s entitlement to receive a
payment pursuant to this Plan in a particular year, the Committee shall delay any payment to an
Executive if the Committee reasonably anticipates that the Company’s deduction with respect to such
payment would be limited or eliminated by application of Internal Revenue Code Section 162(m);
provided, however, that any such delayed payment(s) must be made at the earliest of: i) the date
upon which the Committee reasonably anticipates that the deduction with respect to such payment
will not be limited or eliminated by application of Code Section 162(m), or ii) during the calendar
year in which the Executive Separates from Service.

          8.3 Distribution On Account of Unforeseeable Emergency. Notwithstanding the
preceding provisions of this Article VIII, if the Committee determines that the Executive has an
Unforeseeable Emergency, then upon the Executive’s request the Committee may determine that such
percentage of the Executive’s vested benefit as the Committee determines is necessary to satisfy
such Unforeseeable Emergency shall be distributed to the Executive. The circumstances that will
constitute an Unforeseeable Emergency will depend on the facts of each case, but in any case, the
amount distributed with respect to an emergency shall not exceed the amounts necessary to satisfy
such emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the
distribution, after taking into account the extent to which such hardship is or may be relieved
through reimbursement or compensation by insurance or otherwise or by liquidation of the
Executive’s assets (to the extent the liquidation of such assets would not itself cause severe
financial hardship).

9

 

          8.4 Subsequent Elections. The Committee may permit an Executive to later change his
or her election as to when payment of benefits under this Plan would be made or commence; provided,
however, that: (a) the subsequent election is made at least 12 months before it is to take effect;
(b) the change results in a deferral of payment of at least five years from the earliest date the
benefits, absent such a subsequent election, otherwise would have been paid or commenced; and (c)
where the Executive has elected payment after a specific number of years, the subsequent deferral
election is made at least 12 months before the initial payment was scheduled.

ARTICLE IX

DEATH OF EXECUTIVE

          In the event of the Executive’s death prior to distribution to the Executive of the
Executive’s benefits hereunder, or prior to the completion of the distribution of such benefits to
the Executive if distribution has commenced but has not been completed as of the date of the
Executive’s death, then the amount to be distributed to the Executive, or the remaining amount to
be distributed to the Executive if distribution to the Executive has commenced, shall instead be
distributed in a lump sum to the Executive’s Designated Beneficiary.

ARTICLE X

ADMINISTRATION

          10.1 Committee Authority. The Committee shall have the sole and absolute discretion
to interpret the Plan and administer the Plan in accordance with such interpretations and any such
interpretations shall be binding upon all interested persons. The Committee shall be authorized to
establish rules and procedures as it deems advisable or necessary for the administration of the
Plan. All decisions of the Committee shall be final, conclusive, and binding upon all persons
having any interest in the Plan. In the administration of the Plan, the Committee may, from time
to time: (a) delegate its duties, (b) employ agents and delegate to them such duties as it sees
fit, and (c) consult with legal counsel, who may be legal counsel to the Company.

          10.2 Claims Procedure. If an Executive believes that the Executive is being denied a
benefit which the Executive is entitled under the Plan, the Executive may file a written request
for such benefit with the Committee (in care of the Company at its principal place of business)
setting forth the Executive’s claim. Upon receipt of a claim, the Committee shall advise the
Executive that a reply will be forthcoming within ninety (90) days and shall deliver such reply
within such period, unless the Committee extends the reply period for an additional ninety (90)
days for reasonable cause. If the claim is denied in whole or in part, the Committee shall so
advise the Executive in writing setting forth: (a) the specific reason or reasons for such denial;
(b) the specific reference to pertinent provisions of the Plan on which such denial is based; (c) a
description of any additional material or information necessary for the Executive to perfect the
claim and an explanation why such material or such information is necessary; and (d) appropriate
information as to the steps to be taken if the Executive wishes to submit the claim for

 

 

review. Any request for review must be submitted in writing by the Executive to the Committee (in
care of the Company at its principal place of business) within sixty (60) days after the receipt by
the Executive of the denial of the Executive’s claim. The Executive or the Executive’s duly
authorized representative may, but need not, review the pertinent documents and submit issues and
comments in writing for consideration by the Committee. If the Executive does not request a review
of the Committee’s determination within such sixty (60) day period, the Executive shall be barred
and estopped from challenging the Committee’s determination. Within sixty (60) days after the
Committee’s receipt of a request for review, it will review the determination. After considering
all materials presented by the Executive, the Committee will render a written opinion, written in a
manner calculated to be understood by the Executive, setting forth the specific reasons for the
decision and containing specific references to the pertinent provisions of this Plan on which the
decision is based. If special circumstances require that the sixty (60) day time period be
extended, the Committee will so notify the Executive and will render the decision as soon as
possible, but no later than one hundred twenty (120) days after receipt of the request for review.

ARTICLE XI

MISCELLANEOUS

          11.1 Status of Executives. Executives have the status of general unsecured creditors
of the Company and the Plan constitutes only a promise by the Company to make benefit payments in
the future. Each Executive shall be required to sign the Participation Agreement consenting to the
provisions of the Plan.

          11.2 Non-Alienation of Executive’s Benefits. Except as required by law, no benefit
under this Plan shall be subject in any manner to alienation by anticipation, sale, transfer,
assignment, bankruptcy, pledge, attachment, charge or encumbrance of any kind, nor shall any
benefit under this Plan be subject in any manner to the debts or liabilities of any person, and any
attempt to so alienate or subject any such benefit at any time shall be void.

          11.3 Employment. The adoption of the Plan does not give any person any right to be
retained in the employ of the Company, and no rights granted under the Plan shall be construed as
creating a contract of employment. The right and power of the Company to dismiss or discharge any
person is expressly reserved.

          11.4 No Trust Relationship. Nothing contained herein and no actions taken pursuant
to the Plan shall create or be construed to create a trust of any kind or a fiduciary relationship
between the Company and any Executive. Neither the Company nor the Committee shall be considered a
trustee by reason of the Plan.

          11.5 Amendment and Termination. The Company can amend or terminate the Plan at any
time in its sole discretion; provided, however, no amendment or termination of the Plan shall
affect the rights of any Executive to benefits accrued under the Plan at the time of

11

 

such amendment or termination (though unless otherwise provided all such benefits shall continue to
be subject to the provisions of Article VII).

          11.6 Construction of Plan. The Plan shall be construed so that an Executive shall
not be deemed to be in constructive receipt or have any economic benefit with respect to any
Compensation deferred under the Plan until such Compensation is paid to the Executive and this Plan
shall not be deemed to be funded within the meaning of ERISA.

          11.7 Withholding of Taxes. The Company shall cause taxes to be withheld with respect
to Compensation deferred hereunder as required by law and the Company shall cause taxes to be
withheld from amounts distributed hereunder as required by law.

          11.8 Indemnity of Company. The Company indemnifies and holds harmless each member of
the Committee from and against any and all losses resulting from such member’s actions in such
member’s official capacity in the administration of the Plan.

          11.9 409A Compliance. This Plan is intended to meet the requirements of Section 409A
of the Code and may be administered in a manner that is intended to meet those requirements and
shall be construed and interpreted in accordance with such intent. Any provision of this Plan that
would cause the deferral or payment to fail to satisfy Section 409A of the Code may be amended (in
a manner that as closely as practicable achieves the original intent of this Plan) to comply with
Section 409A of the Code on a timely basis, which may be made on a retroactive basis, in accordance
with regulations and other guidance issued under Section 409A of the Code.

          11.10 Governing Law. The provisions of the Plan, except where otherwise required by
law, shall be governed, construed, enforced, and administered in accordance with the laws of the
State of Missouri.

          11.11 Headings. The headings in the Plan have been inserted for convenience only
and shall not affect the meaning or interpretation of the Plan.

          This
Plan is hereby amended and restated on this 3rd day of
December, effective as of
January 1, 2008, by a duly authorized officer of the Company.

	 	 	 	 	 	 	 	 	 
	 	 	CERNER CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	By:	 	/s/ Julia M. Wilson	 	 
	 	 	 	 	 	 	 
	 
	 	Title:	 	Chief People Officerexv10wxly

 

Exhibit 10(l)

CERNER CORPORATION

2005 ENHANCED SEVERANCE PAY PLAN

As Amended and Restated for I.R.C. § 409A Effective January 1, 2008

     SECTION 1. Introduction.

          (a) Purpose. Cerner Corporation and its United States-based wholly-owned subsidiaries
(“Cerner”) value the contributions of their Associates and take measures to create and maintain a
productive and fulfilling work environment. However, Cerner recognizes that business needs, an
Associate’s work performance or other reasons may require termination of employment. At any point
during an Associate’s employment, Cerner may choose to terminate the employment relationship.

          Because employment with Cerner is at-will, Cerner has no obligation to compensate any
Associate upon termination from his or her employment other than as may be provided in that
Associate’s Cerner Associate Employment Agreement or as specifically set forth in this 2005
Enhanced Severance Pay Plan (“Plan”). Cerner values its Associates and is interested in helping to
mitigate the financial hardship caused by business conditions or other factors necessitating a
termination.

          (b) Overview. Generally, this Plan provides enhanced Severance Benefits to Associates
upon either a (i) “Non-CIC Severance” or (ii) “CIC Severance”, as such terms are defined herein.
Cerner expressly reserves the right to amend or terminate this Plan, or the benefits provided
hereunder, at any time; provided, however, that no such amendment or termination shall occur with
respect to the CIC Severance Benefits after the occurrence of a Change in Control.

          (c) Summary Plan Description. This Plan document also constitutes the Summary Plan
Description for the Plan.

     SECTION 2. Definitions. 

          Certain capitalized terms used herein are defined parenthetically throughout this Plan and/or
defined in this Section 2.

          (a) Associate. “Associate” means an employee of Cerner.

          (b) Beneficial Ownership. “Beneficial Ownership”, “Beneficial Owner” or “Beneficially
Own” shall have the same meaning as such terms are used in Rule 13d-3 of the Exchange Act.

 

 

          (c) Board. “Board” means the Board of Directors of Cerner Corporation.

          (d) Cause. “Cause” means an Eligible Associate’s (i) material breach of his/her
Employment Agreement or material neglect of his/her duties and responsibilities thereunder, (ii)
fraud against Cerner, (iii) misappropriation of Cerner’s assets, (iv) embezzlement from Cerner, (v)
theft from Cerner, (vi) acts resulting in the arrest and indictment for a crime involving drug
abuse, violence, dishonesty or theft, or (vii) act or failure to take any action that results in a
violation of the Sarbanes-Oxley Act of 2002, or any related statutes, laws or regulations.

          (e) Change in Control. “Change in Control” means:

          (i) The acquisition by any “Person” (as the term “person” is used for purposes of
Section 13(d) or 14(d) of the Exchange Act) of Beneficial Ownership of thirty-five percent
(35%) or more of either: (A) the then outstanding shares of common stock of Cerner
Corporation (the “Outstanding Cerner Common Stock”), or (B) the combined voting power of the
then outstanding voting securities of Cerner Corporation entitled to vote generally in the
election of the Board’s directors (the “Outstanding Cerner Voting Securities”); provided,
however, that for purposes of this subsection (i), the following acquisitions shall not
constitute a Change in Control: (X) any acquisition directly from Cerner, (Y) any
acquisition by Cerner, or (Z) any acquisition by any Associate benefit plan (or related
trust) sponsored or maintained by Cerner Corporation or any corporation controlled by
Cerner; or

          (ii) Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a Board director subsequent to the date hereof whose
appointment or election, or nomination for election by Cerner’s shareholders, was approved
by a vote of at least a majority of the Board directors then comprising the Incumbent Board
shall be considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of office occurs
as a result of an actual or threatened election contest with respect to the election or
removal of Board directors or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board; or

          (iii) Consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of Cerner (a “Business Combination”),
in each case, unless, following such Business Combination, (A) all or substantially all of
the individuals and entities who were the Beneficial Owners, respectively, of the
Outstanding Cerner Common Stock and Outstanding Cerner Voting Securities immediately prior
to such Business Combination Beneficially Own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of Cerner Corporation resulting from such Business
Combination (including, without limitation, a corporation which as a result of such
transaction owns Cerner or all or substantially all of Cerner’s assets either

2

 

directly or through one or more subsidiaries) in substantially the same proportions as
their ownership, immediately prior to such Business Combination of the Outstanding Cerner
Common Stock and Outstanding Cerner Voting Securities, as the case may be, (B) no Person
(excluding any Associate benefit plan (or related trust) of Cerner or such corporation
resulting from such Business Combination) Beneficially Owns, directly or indirectly, 35% or
more of, respectively, the then outstanding shares of common stock of Cerner Corporation
resulting from such Business Combination or the combined voting power of the then
outstanding voting securities of such corporation except to the extent that such ownership
existed prior to the Business Combination, and (C) at least a majority of the members of the
Board resulting from such Business Combination were members of the Incumbent Board at the
time of the execution of the initial agreement, or of the action of the Board, providing for
such Business Combination; or

          (iv) Approval by the shareholders of Cerner Corporation of a complete liquidation or
dissolution of Cerner.

          (f) CIC Protected Period. “CIC Protected Period” means the period beginning on the
effective date of a Change in Control and ending on the one-year anniversary of such effective
date.

          (g) CIC Severance. “CIC Severance” means, at any time during the CIC Protected
Period, an Eligible Associate’s termination of employment with Cerner (or its successor), that that
also qualifies as a separation from service under Section 409A of the Code, due to (i) Cerner’s (or
its successor’s) termination without Cause of the Eligible Associate’s employment, or (ii) the
Eligible Associate’s resignation for Good Reason.

          (h) CIC Severance Benefits. “CIC Severance Benefits” means those severance benefits
set forth in Section 4(b) that, provided an Eligible Associate is entitled to receive such benefits
in accordance with Section 3, the Eligible Associate receives following a CIC Severance.

          (i) CIC Week of Severance Pay. A “CIC Week of Severance Pay” means an Eligible
Associate’s: (i) regular weekly base rate of pay in effect on the effective date of a CIC Severance
(prior to any reductions taken for payroll taxes, income tax withholdings, elective deferrals made
to or in connection with Cerner’s Associate benefit plans or Executive Deferred Compensation Plan,
and excluding any overtime, bonuses, commissions, premium pay, benefits, expense reimbursements,
etc.), plus (ii) the average annual cash bonus the Associate had received from Cerner during the
three (3) years preceding the CIC Severance (prior to any reductions taken for payroll taxes,
income tax withholdings, elective deferrals made to or in connection with Cerner’s Associate
benefit plans or Executive Deferred Compensation Plan, and excluding any overtime, bonuses,
commissions, premium pay, benefits, expense reimbursements, etc.), divided by 52 weeks. For
example, a CIC Week of Severance Pay for an Eligible Associate whose: (i) annual base salary
(excluding the pay and benefits listed above) is $52,000, and (ii) whose average annual cash bonus
received during the three (3) years preceding the CIC Severance is $15,600, would be $1,000
($52,000/52 weeks) plus $300 ($15,600/52 weeks), equaling a CIC Week of Severance Pay of $1,300.
Cerner’s cash bonus plan currently pays a bonus, if earned, following each fiscal quarter of
Cerner. When calculating the average annual

3

 

cash bonus, the actual cash bonus paid to the Associate (or earned but not yet paid for the
most recent full fiscal quarter preceding the CIC Severance) for the twelve (12) consecutive full
Cerner fiscal quarters immediately preceding the CIC Severance shall be included in the calculation
of the Associate’s average annual cash bonus for the three (3) years preceding the CIC Severance.
If the Associate has not been employed by Cerner for twelve (12) consecutive full Cerner fiscal
quarters immediately prior to the CIC Severance, the average annual cash bonus received by such
Associate shall be calculated based on the number of consecutive full fiscal quarters the Associate
has been employed by Cerner immediately prior to the CIC Severance and adjusted to equal a yearly
average. For avoidance of all doubt, the calculation of average annual cash bonus shall not
include any sales commissions or similar payments received by an Associate based on individual
sales or contracts signed with Cerner clients.

          (j) COBRA. “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended.

          (k) Code. “Code” means the Internal Revenue Code of 1986, as amended.

          (l) Eligible Associate. “Eligible Associate” means an individual who: (i) is a
permanent, full-time salaried Associate on the U.S. payroll of Cerner, as determined by Cerner’s
employment records; and (ii) has entered into an Employment Agreement. The determination of
whether an Associate is an Eligible Associate shall be made by the Plan Administrator, in its sole
discretion, and such determination shall be binding and conclusive on all persons. In no event
shall part-time Associates, interns or independent contractors be Eligible Associates.

          (m) Employment Agreement. “Employment Agreement” means an Eligible Associate’s then
current Cerner Associate Employment Agreement with Cerner.

          (n) Exchange Act. “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

          (o) Excess Severance Benefits. “Excess Severance Benefits” means any Severance
Benefits that exceed the limit provided in Treas. Reg. Section 1.409A-1(b)(9)(iii).

          (p) Good Reason. “Good Reason” means, without an Eligible Associate’s express written
consent: (i) a material adverse change in the Eligible Associate’s authority, duties or job
responsibilities (except for such subordination in duties and job responsibilities as may normally
be required due to Cerner’s change from an independent business entity to a subsidiary or division
of another corporate entity); or (ii) a reduction of 5% or more to an Eligible Associate’s annual
salary and cash bonus opportunity in effect prior to the Change in Control; provided, however, the
Eligible Associate must provide notice to Cerner (or its successors) within 30 days after the
adverse change or reduction and must give Cerner (or its successors) at least 30 days to remedy the
event or condition. In no event will an isolated, insubstantial and inadvertent action not taken
in bad faith and which is remedied by Cerner (or its successors) constitute Good Reason.

          (q) Non-CIC Severance. “Non-CIC Severance” means at any time, other than during a CIC
Protected Period, an Eligible Associate’s termination of employment with Cerner, that also
qualifies as a separation from service under Section 409A of the Code, by Cerner, other

4

 

than for Cause, due to reorganization, restructuring, unsatisfactory work performance (other
than where such unsatisfactory work performance is deliberate), or for other reasons as determined
by the Plan Administrator in its sole discretion to constitute a Non-CIC Severance. Without
limitation, the following events and reasons shall not constitute a Non-CIC Severance:

               (i) death;

               (ii) disability;

               (iii) voluntary resignation (regardless of the circumstances surrounding the Eligible
Associate’s decision to resign);

               (iv) retirement;

               (v) discharge by Cerner for any other work related reason other than redundancy or
unsatisfactory work performance (including, without limitation, absenteeism, misconduct, refusal to
transfer to an equivalent position that does not require relocation, failure to return to work
after an approved leave of absence, insubordination, violation of Cerner’s rules or policies,
dishonesty, deliberate unsatisfactory performance, etc.);

               (vi) entering military duty;

               (vii) CIC Severance; or

               (viii) Termination for Cause.

          (r) Non-CIC Severance Benefits. “Non-CIC Severance Benefits” means those severance
benefits set forth in Section 4(a) that, provided an Eligible Associate is entitled to receive such
benefits in accordance with Section 3, the Eligible Associate receives following a Non-CIC
Severance.

          (s) Plan Administrator. “Plan Administrator” means the person or entity specified as
such in Section 7.

          (t) Role Level. “Role Level” means an Eligible Associate’s designated category of
employment as specified by Cerner’s current employment classification hierarchy. In the event
Cerner changes its hierarchy structure, the Role Levels specified in this Plan shall refer to the
equivalent Role Level under any new classification scheme.

          (u) Severance Benefits. “Severance Benefits” means either CIC Severance Benefits or
Non-CIC Severance Benefits.

          (v) Specified Associate. “Specified Associate” means an Associate that would be a
“specified employee” as defined in Section 409A(a)(2)(B)(i) of the Code and Department of Treasury
regulations and other interpretive guidance issued thereunder.

          (w) Week of Severance Pay. “Week of Severance Pay” means an Eligible Associate’s
regular weekly base rate of pay in effect on the effective date of a Non-CIC

5

 

Severance (prior to any reductions taken for payroll taxes, income tax withholdings, elective
deferrals made to or in connection with Cerner’s Associate benefit plans or Executive Deferred
Compensation Plan, and excluding any overtime, bonuses, commissions, premium pay, benefits, expense
reimbursements, etc.). For example, a Week of Severance Pay for an Eligible Associate whose annual
base salary as of the Non-CIC Severance (excluding the pay and benefits listed above) is $52,000,
would be $1,000 ($52,000/52 weeks).

          (x) Year of Service. “Year of Service” means, with respect to an Eligible Associate,
each period of twelve (12) consecutive months of full-time employment by Eligible Associate with
Cerner beginning with the Associate’s full-time employment commencement date with Cerner and ending
with the day preceding the anniversary of such date in the next and all succeeding years. No
partial Years of Service shall be credited under this Plan nor will prorated Severance Benefits be
paid for any fractional Year of Service.

     SECTION 3. Entitlement for Severance Benefits

          (a) Entitlement. Subject to the exceptions set forth below in Section 3(b), an
Eligible Associate shall be entitled to receive either the Non-CIC Severance Benefits or the CIC
Severance Benefits described below in Section 4, upon experiencing a Non-CIC Severance or CIC
Severance, respectively, and provided that the following conditions are satisfied:

               (i) The Eligible Associate’s termination of employment with Cerner must have constituted
either a CIC Severance or Non-CIC Severance. In no event shall an Associate’s leave during one of
Cerner’s recognized leave programs constitute a termination of employment event under this Plan,

               (ii) Following or in connection with the Eligible Associate’s termination of employment,
the
Eligible Associate must comply with all transition assistance requests of Cerner, to Cerner’s
satisfaction, such as aiding in the location of files and documents, returning all Cerner property
and repaying any amounts owed Cerner, and

               (iii) With respect to and in connection with a Non-CIC Severance only, the Eligible Associate
has, after the Eligible Associate’s termination of employment, properly executed and delivered to
Cerner a Severance and Release Agreement with Cerner that provides for an irrevocable and complete
release of all present and future claims by Eligible Associate.

          (b) Exceptions to Severance Entitlement. An Eligible Associate will not receive
Severance Benefits under this Plan in the following circumstances, as determined in the Plan
Administrator’s sole discretion:

               (i) The Eligible Associate’s Associate Employment Agreement (or amendments or supplement
thereto) provides that none of the benefits provided under this Plan or any other broad-based
Cerner severance plan or policy shall apply to such Associate. In such a case, such Associate’s
severance benefits, if any, shall be governed by the terms of such Associate Employment Agreement
(as amended or supplemented).

6

 

               (ii) The Associate breaches the terms and conditions of his/her Cerner Associate Employment
Agreement (including, without limitation, violating the non-competition provisions thereof).

               (iii) With respect to Non-CIC Severance Benefits only: (a) the Eligible Associate’s
employment
termination is in connection with the sale, divesture or other disposition of the stock or assets
of any subsidiary, division or other operating unit of Cerner or any of its subsidiaries
(“Operating Unit”) (or part thereof) which does not constitute a Change in Control (a
“Transaction”), and the Eligible Associate is offered continued employment, or continues in
employment, with the divested Operating Unit (or part thereof) or the purchaser of the stock or
assets of the Operating Unit (or part thereof), or one of such purchaser’s affiliates (the
“Post-Transaction Employer”), as the case may be, on terms and conditions that would not constitute
Good Reason, and (b) Cerner obtains an agreement from the Post-Transaction Employer, enforceable by
the Eligible Associate, to provide (or Cerner agrees to provide) severance pay, if the Eligible
Associate accepts the offered employment or continues in employment with the Post-Transaction
Employer or its affiliates following the Transaction, at least equal to the severance pay set forth
in Section 4(a) payable upon a Non-CIC Severance termination of the Eligible Associate’s employment
with the Post-Transaction Employer or its affiliates within the six (6) month period following the
Transaction. For purposes of this Section 3(b)(iii), the term “Good Reason” shall have the meaning
ascribed to it in this Plan, but the term “Cerner” as it is used in such definition shall be deemed
to refer to the Post-Transaction Employer employing the Eligible Associate after the Transaction.
For avoidance of doubt, in the circumstances described in the first sentence of this Section
3(b)(iii), the Eligible Associate shall not be entitled to receive Non-CIC Severance Benefits under
Section 4(a) whether or not the Eligible Associate accepts the offered employment or continues in
employment. Except as to separate severance benefits Cerner may itself expressly agree to in
writing to provide in connection with a Transaction (as contemplated by subpart (b) of the first
sentence of this Section 3(b)(iii)), the provisions of this Section 3(b)(iii) do not create any
entitlement to Severance Benefits from Cerner in any circumstances whatsoever and are to be
construed solely as a limitation on such entitlement in the circumstances herein set forth.

     SECTION 4. Severance Benefits.

          (a) Non-CIC Severance Benefits: If the termination of an Eligible Associate’s
employment constitutes a Non-CIC Severance, Cerner shall pay the Eligible Associate an amount of
severance pay based on the Eligible Associate’s Role Level and Years of Service with Cerner as of
the effective date of such termination. The amount of such severance pay shall be equal to: (i) a
Week of Severance Pay for such Eligible Associate multiplied by (ii) that number set forth in the
matrix below that corresponds to the Eligible Associate’s Role Level and Years of Service with
Cerner.

7

 

Severance Matrix

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Role Level 4	 	 	 	Level 1	 	 	 	Levels 2 and 3	 	 	 	Levels 6
	Years of 	 	 	 	(V.P.’s –	 	Level 1	 	(Managers & Sr.	 	Levels 4 and	 	and 7
	Service 6  	 	Cabinet	 	nonCabinet)	 	(Directors)	 	Managers)	 	5 (Sr. Staff)	 	(Staff)
	>10 Years

	 	52 (Weeks)
	 	32 (Weeks)
	 	24 (Weeks)
	 	16 (Weeks)
	 	12 (Weeks)
	 	8 (Weeks)
	5-10 Years

	 	36 (Weeks)
	 	24 (Weeks)
	 	18 (Weeks)
	 	12 (Weeks)
	 	9 (Weeks)
	 	6 (Weeks)
	2-5 Years

	 	24 (Weeks)
	 	16 (Weeks)
	 	12 (Weeks)
	 	8 (Weeks)
	 	6 (Weeks)
	 	4 (Weeks)
	0-2 Years

	 	16 (Weeks)
	 	10 (Weeks)
	 	6 (Weeks)
	 	4 (Weeks)
	 	3 (Weeks)
	 	2 (Weeks)

          (b) CIC Severance Benefits. If the termination of an Eligible Associate’s employment
constitutes a CIC Severance, Cerner shall pay the Eligible Associate an amount of severance pay
based on the Eligible Associate’s Role Level and Years of Service with Cerner as of the effective
of such termination. The amount of such severance pay shall be equal to: (i) a CIC Week of
Severance Pay for such Eligible Associate multiplied by (ii) that number set forth in the matrix
above that corresponds to both the Eligible Associate’s Role Level and Years of Service with
Cerner, multiplied by 1.5.

          (c) Form of Payment.

               (i) Except with respect to Excess Severance Benefits, in the event of a Non-CIC Severance that
occurs before any Change in Control, Non-CIC Severance Benefits shall be paid in a lump sum or, if
the Plan Administrator elects, as salary continuation (without interest) on regularly scheduled
paydays of Cerner for the applicable severance period or some other method, but in no event shall
payments continue beyond the last day of the second calendar year following the calendar year the
Non-CIC Severance occurs.

               (ii) Subject to Section 4(c)(v) below, in the event of a CIC Severance, CIC Severance
Benefits
shall be paid in a lump sum as soon as practicable within 90 days of the CIC Severance.

               (iii) Subject to Section 4(c)(v) below, in the event of a Non-CIC Severance that occurs
after
any Change in Control, Non-CIC Severance Benefits shall be paid in a lump sum as soon as
practicable within 90 days of the Non-CIC Severance.

               (iv) Subject to Section 4(c)(v) below, all Excess Severance Benefits shall be paid in a
lump
sum as soon as practicable within 90 days of the CIC Severance or Non-CIC Severance.

               (v) If the Associate receiving any Severance Payment under this Plan is a Specified
Associate, then any payment that the Associate would otherwise have been paid under Section
4(c)(ii), (iii) or (iv) above shall be paid on the first day of the seventh month following the CIC
or Non-CIC Severance.

               (vi) Any Severance Benefits, including Excess Severance Benefits, that are subject to the
offset provisions of Section 6(c) of the Plan will be paid at the time and in the

8

 

form the Company determines would allow payment of such offset benefits to comply with Code
section 409A.

          (d) Withholding. All Severance Benefits made under this Plan will be subject to
applicable withholding for federal, state and local taxes. If any Eligible Associate is indebted
to Cerner at his or her termination date, Cerner reserves the right to offset any Severance
Benefits under this Plan by the amount of such indebtedness.

     SECTION 5. Employment.

          (a) No Modification of Associate Employment Agreements. This Plan shall not modify
any terms of an Eligible Associate’s Employment Agreement, including but not limited to the type of
employment relationship, the Associate’s obligations and continuing obligations set forth therein.

          (b) Limitation on Associate Rights. This Plan shall not give any Associate the right
to be retained in the service of Cerner or interfere with or restrict the right of Cerner to
terminate the employment of any Associate.

          (c) Changed Decisions. Cerner has the right to cancel or reschedule the effective
date of an Eligible Associate’s employment termination. An Eligible Associate will not be eligible
for any Severance Benefits under this Plan if the Eligible Associate’s employment termination is
canceled by Cerner, or if the Eligible Associate is offered an opportunity to return to work or
have his or her employment reinstated with Cerner.

     SECTION 6. Relation to Other Benefits and Pay

          (a) COBRA. Associates and their dependents covered under one or more of Cerner’s
group health plans may be eligible for continuation coverage pursuant to the federal COBRA law.
This Plan does not provide Associates or their dependents with any greater right to continuation
coverage than what the federal COBRA law requires.

          (b) Other Benefit Plans. Eligibility, coverage and benefits under other Cerner
benefit plans (e.g., any group life, disability, accidental death, retirement, stock plans, etc.)
are governed by the terms of those respective plans. This Plan does not provide Associates or
their beneficiaries and dependents with any greater eligibility, coverage or benefits than what
such plans provide.

          (c) Offset of Benefits. Except as may otherwise be specifically provided for in an
Associate’s Employment Agreement, the amount of any Severance Benefits paid under this Plan is in
lieu of, and not in addition to, any other severance an Eligible Associate may otherwise be
entitled to receive from Cerner, including under a Cerner Associate Employment Agreement or other
document. Notwithstanding the payment provisions of Section 4(c) and subject to the immediately
preceding sentence, the Company may, at its sole option and discretion, pay other severance
benefits according to the time and form specified in the plan or agreement to which the other
severance benefit applies, if the Company determines that doing so would allow both this Plan and
the other plan or agreement to operate in compliance with Code section 409A.

9

 

          (d) Integration with Other Payments. Severance Benefits paid under this Plan are not
intended to duplicate benefits such as pay-in-lieu of notice, severance pay, workers compensation
wage replacement, disability pay, or similar benefits or pay under other benefit plans, severance
programs, employment agreements, transaction documents or applicable laws, such as the WARN Act.
In the event such other pay or benefits is payable to an Eligible Associate, Severance Benefits
under this Plan will be reduced accordingly or, alternatively, pay or benefits previously paid
under this Plan will be treated as having been paid to satisfy other pay or benefit obligations.
In either case, the Plan Administrator, in its sole discretion, will determine how to apply this
provision and may override other provisions in the Plan in doing so. This provision, however,
shall not preclude an otherwise Eligible Associate from receiving any payments under a Cerner
Performance Plan (CPP) or any pay for accrued vacation under Cerner’s separate CPP or vacation
policy, as may be amended from time-to-time. CPP and pay for accrued vacation, if any, shall be
paid pursuant to the terms of those separate plans or policies.

          (e) Reemployment. If an Eligible Associate is reemployed by Cerner while Severance
Benefits are still payable under the Plan, all such Severance Benefits will cease, except as
otherwise specified by the Plan Administrator, in its sole discretion.

     SECTION 7. Plan Administration.

          (a) Plan Administrator. The Plan is administered by Cerner, which is the Plan
Administrator under the Employee Retirement Income Security Act of 1974 (“ERISA”). It is the
responsibility of the Plan Administrator to ensure that the Plan is administered in accordance with
its terms. It is also the responsibility of the Plan Administrator to explain any rights and
benefits that an Eligible Associate may have under the Plan and to answer any questions which an
Eligible Associate may have. The Plan Administrator maintains all documents which comprise the
Plan and annual filings, if any, which are prepared for the Plan. If you have any questions
regarding the Plan, you should review these available documents. The Plan Administrator may, but
is not required to, adopt rules and regulations of uniform applicability in its interpretation and
implementation of the Plan. The Plan Administrator may require each Eligible Associate to submit,
in such form as it shall deem reasonable and acceptable, proof of any information which the Plan
Administrator finds necessary or desirable for the proper administration of the Plan.

          (b) Exclusive Discretion. The Plan Administrator has full and complete discretionary
authority to determine eligibility for benefits under the Plan and to construe and interpret the
terms of the Plan. In making any decision or resolving any disputes, Cerner shall have full and
complete discretionary authority to (i) construe and interpret the provisions of the Plan and to
determine the right of any person to any interest in or eligibility for any benefit under the Plan,
and (ii) make any and all factual determinations necessary to determine the right of any person to
any interest in or eligibility for any benefit under the Plan; and, no person shall be entitled to
any benefit or interest under this Plan if Cerner decides in its discretion that there is no
entitlement to that benefit or interest. Decisions of Cerner shall be final, binding and
conclusive upon all parties.

10

 

     SECTION 8. Amendment or Termination

          Cerner, acting through its Chief Executive Officer, Chief Financial Officer, Chief Legal
Officer or Chief People Officer, has the right, in its nonfiduciary capacity, to amend the Plan or
to terminate it at any time, prospectively or retroactively, for any reason or no reason, without
notice, including discontinuing or eliminating benefits; provided, however, that no such amendment
or termination shall affect the right to any unpaid benefit of any Eligible Associate whose
termination date has occurred prior to such amendment or termination of the Plan and provided
further that no amendment or termination shall occur with respect to the CIC Severance Benefits
after the occurrence of a Change in Control.

     SECTION 9. Claims and Appeal Procedure

          (a) Initial Claim. If benefits under this Plan become due, the Plan Administrator
will notify you as to the amount of benefits you are entitled to, the duration of such benefit, the
time the benefit is to commence and other pertinent information concerning your benefit. If you
have been denied a benefit under the Plan, or if you feel that the benefit which has been given to
you is not accurate, you may file a claim with the Plan Administrator. If a claim for benefit is
denied by the Plan Administrator, the Plan Administrator shall provide you with written or
electronic notification of any adverse benefit determination within ninety (90) days after receipt
of the claim unless special circumstances require an extension of time for processing the claim.
If such an extension of time for processing is required, written or electronic notice indicating
the special circumstances and the date by which a final decision is expected to be rendered shall
be furnished to you. In no event shall the period of extension exceed one hundred eighty (180)
days after receipt of the claim. The notice of denial of the claim shall set forth:

               (i) The specific reason or reasons for the adverse determination;

               (ii) Reference to the specific plan provisions on which the determination is based;

               (iii) A description of any additional material or information necessary for you to perfect the
claim, and an explanation of why such material or information is necessary; and

               (iv) A description of the plan’s review procedures and the time limits applicable to such
procedures, including a statement of your right to bring a civil action under ERISA section 502(a)
following an adverse benefit determination on review.

          You (or your duly authorized representative) may review pertinent documents and submit issues
and comments in writing to the Plan Administrator. If you fail to appeal such action to the Plan
Administrator in writing within the prescribed period of time described in the next section, the
Plan Administrator’s adverse determination shall be final, binding and conclusive.

          (b) Appeal. In the event of an adverse benefit determination, you may appeal the
adverse determination by giving written notice to the Plan Administrator within 60 days after

11

 

receipt of the notice of adverse benefit determination. The Plan Administrator may hold a
hearing or otherwise ascertain such facts as it deems necessary and shall render a decision which
shall be binding upon both parties. The appeal procedure shall:

               (i) Provide you at least 60 days following receipt of a notification of an adverse benefit
determination within which to appeal the determination;

               (ii) Provide you the opportunity to submit written comments, documents, records, and other
information relating to the claim for benefits;

               (iii) Provide that you shall be provided, upon request and free of charge, reasonable access
to, and copies of, all documents, records, and other information relevant to your claim for
benefits; and

               (iv) Provide for a review that takes into account all comments, documents, records, and other
information submitted by you relating to the claim, without regard to whether such information was
submitted or considered in the initial benefit determination.

          The decision of the Plan Administrator shall be made within sixty (60) days after the receipt
by the Plan Administrator of the notice of appeal, unless special circumstances require an
extension of time for processing, in which case a decision of Cerner shall be rendered as soon as
possible but not later than one hundred twenty (120) days after receipt of the request for review.
If such an extension of time is required, written or electronic notice of the extension shall be
furnished to you prior to the commencement of the extension. The decision of the Plan
Administrator shall be provided in written or electronic form to you and shall include the
following:

               (i) The specific reason or reasons for the adverse determination;

               (ii) Reference to the specific plan provisions on which the benefit determination is based;

               (iii) A statement that you are entitled to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other information relevant to your
claim for benefits. Whether a document, record, or other information is relevant to a claim for
benefits shall be determined by reference to DOL Regulation Section 2560.503-1 (m)(8); and

               (iv) A statement describing any voluntary appeal procedures offered by the Plan and your right
to obtain the information about such procedures, and a statement of your right to bring an action
under ERISA section 502(a).

     SECTION 10. Statement of ERISA Rights

          The following statement is required by federal statute. Certain portions of this statement
may not apply to your particular situation or to this Plan.

12

 

          (a) Information About This Plan and Your Benefits. If you become a participant in the
Cerner Corporation Enhanced Severance Pay Plan you are entitled to certain rights and protections
under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan
participants shall be entitled to:

	 	•	 	Examine, without charge, at the Plan Administrator’s office and at other specified
locations, the Plan documents and, if any, copies of all documents filed by the Plan
with the U.S. Department of Labor, such as detailed annual reports and plan
descriptions.
	 
	 	•	 	Obtain copies of all Plan documents and other plan information upon written request
to the Plan Administrator. The Plan Administrator may make a reasonable charge for the
copies.
	 
	 	•	 	Receive a summary of the Plan’s annual financial report, if one is required to be
prepared. The Plan Administrator is required by law to furnish each participant with a
copy of this summary annual report if an annual report is required to be filed with the
Department of Labor.

          (b) Prudent Actions by Plan Fiduciaries. In addition to creating rights for plan
participants, ERISA imposes duties upon the people who are responsible for the operation of the
employee benefit plan. The people who operate your plan, called “fiduciaries” of the plan, have a
duty to do so prudently and in the interest of you and other plan participants and beneficiaries.
No one, including your employer or any other person, may fire you or otherwise discriminate against
you in any way to prevent you from obtaining a welfare benefit or exercising your rights under
ERISA.

          (c) Enforce Your Rights. If your claim for a Plan benefit is denied in whole or in
part you must receive a written explanation of the reason for the denial. You have the right to
have the Plan review and reconsider your claim. Under ERISA, there are steps you can take to
enforce the above rights. For instance, if you request materials from the Plan and do not receive
them within 30 days, you may file suit in a federal court. In such a case, the court may require
the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the
materials, unless the materials were not sent because of reasons beyond the control of the
administrator. If you have a claim for benefits which is denied or ignored, in whole or in part,
you may file suit in a state or federal court. If it should happen that plan fiduciaries misuse
the plan’s money, or if you are discriminated against for asserting your rights, you may seek
assistance from the U.S. Department of Labor, or you may file suit in a federal court. The court
will decide who should pay court costs and legal fees. If you are successful the court may order
the person you have sued to pay these costs and fees. If you lose, the court may order you to pay
these costs and fees, for example, if it finds your claim is frivolous.

          (d) Assistance with Your Questions. If you have any questions about this Plan, you
should contact the Plan Administrator. If you have any questions about this statement or about
your rights under ERISA, you should contact the nearest office of the Employee Benefits and
Security Administration, U.S. Department of Labor, listed in your telephone directory, or the
Division of Technical Assistance and Inquiries, Employee Benefits and Security

13

 

Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C.
20210.

     SECTION 11. Additional Information

          (a) Name and Address of Plan Sponsor and Plan Administrator. The name and address of
the Plan Sponsor and the Plan Administrator is:

Cerner Corporation

2800 Rockcreek Parkway

North Kansas City, MO 64117

EIN: 43-1196944

Telephone: (816) 201-1024

          (b) Type of Administration. The Plan is administered by Cerner Corporation.

          (c) Plan Number. The Plan number is 513.

          (d) Plan Year. The Plan Year ends on December 31.

          (e) Agent For Service of Legal Process. Service of legal process may be made upon the
Plan Sponsor (which is also the Plan Administrator) at the above address.

          (f) Plan Costs. Plan costs are paid by Cerner. The Plan is funded out of Cerner’s
general assets.

          (g) Insurance. Benefits provided by this Plan are not insured by the Pension Benefit
Guaranty Corporation under Title IV of ERISA because the insurance provisions under ERISA are not
applicable to the Plan.

     SECTION 12. Governing Law. 

          This Plan is an “employee welfare benefit plan” within the meaning of Section 3(1) of ERISA
and it shall be interpreted, administered, and enforced in accordance with that law. To the extent
that state law is applicable, the statutes and common law of the State of Missouri, excluding any
that mandate the use of another jurisdiction’s laws, shall apply. Without limiting the generality
of this Section 12, it is intended that the Plan comply with Section 409A of the Code, and, in the
event that this Plan is determined to be a “deferred compensation plan” within the meaning of
Section 409A(d)(1) of the Code, Cerner shall, as necessary, adopt such conforming amendments as are
necessary to comply with Section 409A of the Code.

     SECTION 13. Basis of Payments to and From the Plan

          The Plan shall be unfunded, and all cash payments under the plan shall be paid only from the
general assets of Cerner.

14

 

     SECTION 14. Limitation on IRC Section 280G Parachute
Payments

          In the event that any Severance Benefit payment to be made under this Plan would cause an
Eligible Associate to be liable for any excise tax under Code section 4999(a), the aggregate amount
of such Severance Benefit shall be reduced by the minimal amount necessary such that the Eligible
Associate is no longer subject to such excise tax.   Any determination or calculation made by
Cerner relating to this Section 14, including, but not limited to, any calculation of an Eligible
Associate’s “base amount” as defined in Code section 280G(b)(3), or an Eligible Associate’s
anticipated “parachute payment,” as defined in Code section 280G(b)(2), shall be final, conclusive
and binding on the Eligible Associate.

     SECTION 15. Construction. 

          Where the context so indicates, the singular will include the plural and vice versa. Titles
are provided herein for convenience only and are not to serve as a basis for interpretation or
construction of the Plan. Unless the context clearly indicates to the contrary, a reference to a
statute or document shall be construed as referring to any subsequently enacted, adopted, or
executed counterpart.

15

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