Document:

exv10we

Exhibit 10(e)

AMENDMENT TO CREDIT AGREEMENT AND CONSENT

     This Amendment to Credit Agreement and Consent (this “Amendment”) is made and entered into as
of May __, 2011 but effective as of February 28, 2011, by and between VIDEO DISPLAY CORPORATION, a
Georgia corporation (“Parent”), LEXEL IMAGING SYSTEMS, INC. (“Lexel”), Z-AXIS, INC. (“Z-Axis”),
TELTRON TECHNOLOGIES, INC. (“Teltron”) and AYDIN DISPLAYS, INC. (“Aydin” and together with Lexel,
Z-Axis and Teltron, collectively, the “Subsidiaries”; and the Subsidiaries, together with Parent,
collectively, the “Borrowers”) and RBC BANK (USA), as administrative agent (the “Agent”), and RBC
BANK (USA), as a lender (“RBC”), and COMMUNITY & SOUTHERN BANK (“CSB”), as a lender (RBC and CSB,
the “Lenders”);

W I T N E S S E T H:

     WHEREAS, the Borrowers, FOX INTERNATIONAL, LTD., INC. (“Fox”), the Agent and the “Lenders have
made and entered into that certain Credit Agreement, dated as of December 23, 2010 (the “Original
Credit Agreement” and, as amended hereby, the “Credit Agreement”; capitalized terms used herein and
not otherwise defined shall have the meanings ascribed thereto in the Credit Agreement);

     WHEREAS, pursuant to the Original Credit Agreement, the Agent and Lenders have extended to the
Borrowers and Fox a credit facility consisting of (i) the Aggregate Revolving Loan Commitment in
the original principal amount of up to $17,500,000, (ii) the Term Loan A Commitment in the original
principal amount of up to $3,500,000, and (iii) the Term Loan B Commitment in the original
principal amount of up to $3,000,000;

     WHEREAS, Ronald D. Ordway (the “Guarantor”) has guaranteed a portion of the Borrowers’
Obligations pursuant to that certain Amended and Restated Unconditional Limited Guaranty Agreement,
dated as of December 23, 2010, from the Guarantor in favor of the Agent and the Lenders (as such
guaranty is amended, modified supplemented or restated from time to time, the “Guaranty”);

     WHEREAS, pursuant to a Stock Purchase Agreement, dated as of March 1, 2011, between the Parent
and FI ACQUISITION LLC (the “Intermediate Purchaser”) (the “Stock Purchase Agreement”), the Parent
will sale and transfer of all of the issued and outstanding stock of Fox owned by the Parent (the
“Fox Stock Transfer”) to the Intermediate Purchaser; and

     WHEREAS, pursuant to an Asset Purchase Agreement, dated as of March 1, 2011, between the
Intermediate Purchaser, Fox and FOX INTERNATIONAL CORPORATION, a Georgia corporation (“New Fox”)
(the “Asset Purchase Agreement”), Fox will sale and transfer all or substantially all of its assets
to New Fox, other than Fox’s real property in Cuyahoga County, Ohio (the “Fox Real Property”), and
New Fox will assume substantially all of the liabilities of Fox (the “New Fox Asset Transfer”); and

     WHEREAS, Fox will sale and transfer the Fox Real Property to SOUTHEASTERN
METRO SAVINGS LLC (“Southeastern”)
pursuant to an Agreement for Purchase and Sale of

 

 

 Real
Estate, dated as of March 1, 2011, between Fox and Southeastern (the “Real Estate Purchase
Agreement”) and related Limited Warranty Deed, dated as of March 1, 2011, from Fox to Southeastern
(the “Southeastern Real Property Transfer”), which Fox Real Property Transfer shall be subject to
the Mortgage on the Fox Real Property; and

     WHEREAS, in connection with the Fox Stock Transfer, the New Fox Asset Transfer and the
Southeastern Real Property Transfer, Borrowers desire to (i) obtain the release of Fox from its
liability for the Obligations and for its Collateral pledged to secure the same, except that the
Mortgage on Fox’s property shall remain in effect to secure the Obligations, and (ii) pay down and
permanently reduce the Aggregate Revolving Loan Commitment;

     WHEREAS, certain Defaults and Events of Default have also occurred and are continuing under
certain provisions of the Original Credit Agreement;

     WHEREAS, the Borrowers have asked the Agent and the Lenders to consent to the Fox Stock
Transfer, the New Fox Asset Transfer and the Southeastern Real Property Transfer and to waive such
continuing Defaults and Events of Default, and the Agent and the Lenders are willing to agree to
the same on the terms and conditions set forth herein;

     WHEREAS, the Borrowers also desire to amend certain provisions of the Credit Agreement, and
the Agent and the Lenders are willing to agree to the same on the terms and conditions set forth
herein;

     NOW THEREFORE, for and in consideration of the foregoing and for ten dollars ($10.00) and
other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
the parties hereto agree as follows:

ARTICLE 1.

Amendments to Credit Agreement

     Section 1.1 Definition Amendments. The following definitions in Section 1.1 of the Credit
Agreement are hereby amended in their entirety to read as follows:

“Aggregate Revolving Loan Commitment” means the combined Revolving Loan Commitments
of all Lenders, which shall initially be in the amount of (i) Fifteen Million and
00/100 Dollars ($15,000,000).

“EBITDA” means, as of any date of calculation, calculated on a consolidated basis
for Borrowers and in accordance with GAAP, net income from continuing operations
(excluding extraordinary gains or losses), plus interest expense, plus income tax
expense, plus depreciation and amortization, each for the Applicable Fiscal Period.

“Fixed Charge Coverage Ratio” means, as of any date of calculation, calculated on a
consolidated basis for Borrowers in accordance with GAAP, the sum of (i)
EBITDA, plus lease and rent expense associated with continuing operations, less

2

 

cash
income taxes, less any dividends and distributions, each for the Applicable Fiscal
Period, divided by (ii) the sum of lease and rent expense associated with continuing
operations, plus the current maturities of long term debt (excluding current
maturities of long term debt resulting from the maturity of the Revolving Loan and
required reductions in the Revolving Loan Commitments, and excluding that portion of
the current maturities of long term debt resulting from balloon payments in excess
of scheduled principal amortizations due to the maturity of amortizing term debt),
plus interest expense associated with continuing operations, each for the Applicable
Fiscal Period.

     Section 1.2 Amendment. Section 6.15(c) of the Credit Agreement is hereby amended in its
entirety to read as follows:

(c) Senior Funded Debt to EBITDA Ratio. The Borrowers shall maintain, on a
consolidated basis, a Senior Funded Debt to EBITDA Ratio of not more than (i) 3.75
to 1.00 for each fiscal quarter end through November 29, 2011, (ii) 3.50 to 1.00 for
each fiscal quarter end from November 30, 2011 through February 27, 2012, and (iii)
3.00 to 1.00 for each fiscal quarter end on and after February 28, 2012.

     Section 1.3 Amendment. Section 8.01 of the Credit Agreement is hereby amended as follows:
the “.” at the end of clause (l) is deleted and replace with “; or” and the following new clauses
(m) (n) and (o) are hereby added at the conclusion of Section 8.01 to read in their entirety as
follows:

(m) any of the Borrowers shall be deemed to have any liability or obligations in
respect of the obligations and liabilities of any of FOX INTERNATIONAL, LTD., INC.,
FI ACQUISITION LLC, FOX INTERNATIONAL CORPORATION, or SOUTHEASTERN METRO SAVINGS
LLC(“Southeastern”); or

(n) The Parent shall fail to provide to the Agent and the Lenders, by May 31, 2011,
with the Parent’s audited financial statements for its fiscal year ending February
28, 2011, including the unqualified audit opinion of Parent’s independent certified
public accountants, which financial statements and unqualified audit opinion shall
show Fox and its operations as “discontinued operations” and which financial
statements and unqualified audit opinion shall be in form and substance satisfactory
to the Agent and the Lenders.;

(o) Southeastern shall fail to provide to the Agent and the Lenders, by June 15,
2011, with evidence that the property transferred by Fox to Southeastern in Cuyahoga
County, Ohio is insured to the satisfaction of the Agent and Lenders, with the Agent
and the Lenders shown as a mortgagee and additional insured and loss payee on such
insurance policy, with 30 days notice of cancellation.

3

 

     Section 1.4 Amendment. Notwithstanding anything to the contrary in the Credit Agreement and
the other Loan Documents, Fox shall no longer be deemed a Subsidiary of Parent (nor shall the
Intermediate Purchaser, New Fox and Southeastern), and no Loan proceeds shall be advanced by any
Borrower to Fox, the Intermediate Purchaser, New Fox and/or Southeastern (unless such the same
constitutes an Investment permitted under Section 7.02 of the Credit Agreement).

     Section 1.5 Schedule. Schedule 2.01 to the Credit Agreement is hereby amended in its entirety
to read in the form attached hereto as Schedule 2.01.

     Section 1.6 Schedule. Schedule 5.13 to the Credit Agreement is hereby amended in its entirety
to read in the form attached hereto as Schedule 5.13.

ARTICLE 2.

Consent to Fox Sale

     Section 2.1 Consent. Notwithstanding anything to the contrary herein, but subject to
satisfaction of the conditions specified hereinafter in Article 6 hereof, the Agent and the Lenders
hereby (i) consent to the Fox Stock Transfer to the Intermediate Purchaser pursuant to the terms of
the Stock Purchase Agreement, (ii) consent to the New Fox Asset Transfer to New Fox pursuant to the
terms of the Asset Purchase Agreement, (iii) consent to the Southeastern Real Estate Transfer to
Southeastern pursuant to the terms of the Real Estate Purchase Contract, and (iv) agree that the
consummation of the Fox Stock Transfer, the New Fox Asset Transfer and the Southeastern Real Estate
Transfer, pursuant to the terms of the Stock Purchase Agreement, the Asset Purchase Agreement and
the Real Estate Purchase Contract, respectively, shall not constitute a Default or Event of Default
under the Credit Agreement and any of the other Loan Documents.

     Section 2.2 Prepayment. Upon satisfaction of the conditions specified hereinafter in Article 6
hereof, notwithstanding anything to the contrary in Section 2.03 of the Credit Agreement, the
Borrowers shall not be obligated to make prepayment of the Loans in excess of a $250,000 repayment
of the Revolving Loan (and related $2,500,000 reduction in the Aggregate Revolving Loan
Commitment); provided the $3,272,000 in Parent stock received by Parent from the Intermediate
Purchaser shall be held in treasury by Parent.

     Section 2.3 Modification of Credit Agreement and Loan Documents. Upon satisfaction of the
conditions specified hereinafter in Article 6 hereof, Fox shall no longer be deemed (and New Fox,
the Intermediate Purchaser and Southeastern) shall not be deemed) a “Borrower” for purposes of the
Credit Agreement, the Notes and the other Loan Documents and shall be released from its obligations
under the Credit Agreement, the Notes and the other Loan Documents; provided, however, that (i) Fox
and Southeastern, as the assignee of Fox, shall not be released from the Mortgage originally
executed by Fox in favor of the Agent and Lenders on its facility in Cuyahoga County, Ohio (the
“Fox Mortgage”), and (ii) Southeastern shall assume Fox’s obligations under the Fox Mortgage
pursuant to an assignment and assumption agreement in form and substance satisfactory to the Agent
and the Lenders (the “Fox Mortgage Assumption”).

4

 

ARTICLE 3.

Acknowledgment of Defaults

     Section 3.1 Acknowledgment of Default. Events of Default (the “Existing Defaults”) have
occurred under Section 8.01(b) the Credit Agreement as a result of the Borrowers’ failure to comply
with (i) Section 6.15(a) of the Credit Agreement (Fixed Charge Coverage Ratio) and (ii)
Section 6.15(c) of the Credit Agreement (Senior Funded Debt to EBITDA Ratio) for the fiscal
quarter ending February 28, 2011.

     Section 3.2 Acknowledgments. The execution, delivery and performance of this Amendment by the
Agent and the Lenders and the acceptance by the Agent and the Lenders of performance of each of the
Borrowers and the Guarantor hereunder and under the other Loan Documents executed and delivered in
connection herewith (a) shall not constitute a waiver or release by the Agent and the Lenders of
any Default or Event of Default that may now or hereafter exist under the Loan Documents, except
for the waiver of the Existing Defaults to the extent provided herein, (b) shall not constitute a
novation of the Loan Documents, as it is the intent of the parties to modify the Loan Documents as
expressly set out herein, and (c) except as expressly provided in this Amendment, shall be without
prejudice to, and is not a waiver or release of, the Agent’s and the Lenders’ rights at any time in
the future to exercise any and all rights conferred upon the Agent and the Lenders by the Loan
Documents or otherwise at law or in equity, including but not limited to the right to institute
foreclosure proceedings against the Collateral and/or institute collection, foreclosure or
arbitration proceedings against the Borrowers and/or the Guarantor and/or to exercise any right
against any other Person not a party to this Amendment.

ARTICLE 4.

Waivers

     Section 4.1 Waiver Covenant. Upon satisfaction of the conditions specified hereinafter in
Article 6, the Agent and the Lenders shall waive the Existing Defaults and shall not because of the
Existing Defaults,

     3.1.1 accelerate any of the Loans or demand accelerated payment of the same;

     3.1.2 require the payment of interest at the Default Rate set forth in the Loan
Documents; or

     3.1.3 exercise any other remedies under the Credit Agreement or under the other Loan
Documents.

     The Agent’s and the Lenders’ waiver of the Existing Defaults from such actions, subject to the
terms and conditions of this Amendment, is herein referred to as the “Waiver Covenant”. The
effectiveness of each term of the Waiver Covenant is expressly conditioned on the strict
satisfaction of each and every condition set forth in Article 6 of this Amendment. The Waiver
Covenant applies solely to the Existing Defaults and to no other Defaults or Events of Default,

5

 

whether now existing or hereinafter arising and whether now known to the Bank or the Borrowers
and/or the Guarantor.

     Section 4.2 Continued Compliance With the Loan Documents. Notwithstanding this Amendment,
each of Borrowers and Guarantor shall continue to perform and comply strictly with each and every
provision of the Loan Documents (as modified hereby), except for the Existing Defaults, which are
being waived by the Agent and the Lenders pursuant to this Amendment (but only upon strict
satisfaction of the conditions set forth in Article 6 hereof).

ARTICLE 5.

Release; Waivers by Borrowers and Guarantor

     Section 5.1 Release. In consideration of the accommodations and concessions made by the Bank
pursuant to this Amendment, each of the Borrowers and Guarantor does hereby irrevocably remise,
release, acquit, satisfy and forever discharge each of the Agent and the Lenders, and their
respective successors and assigns, all of their respective affiliates and subsidiaries, past,
present and future, and all of their respective shareholders, officers, directors, employees,
agents, attorneys, representatives and participants, from any and all manner of debts, accountings,
bonds, warranties, representations, covenants, promises, contracts, controversies, agreements,
claims, executions, counterclaims, demands and causes of action of any nature or type whatsoever,
whether at law or in equity, whether known or unknown, either now accrued or hereafter maturing,
which it now has or hereafter can, shall or may have by reason of any matter, claim or action
arising through the date hereof out of or relating to the administration, funding or existence of
the Obligations and/or the Loan Documents.

     Section 5.2 Waivers. Each of the Borrowers and the Guarantor acknowledges and agrees that each
of the Agent and the Lenders has all rights and remedies of a “secured party” under the UCC and all
rights and remedies provided by applicable law. Each of the Borrowers and the Guarantor waives any
additional right to notice of any Default or Event of Default or opportunity to cure any Default or
Event of Default. Notwithstanding anything to the contrary in the Credit Agreement, any security
agreement, any guaranty agreement or any other Loan Document to which it is a party, each of the
Borrowers and the Guarantor hereby irrevocably waives (i) any right to notification required under
UCC Section 11-9-611 of the disposition of any “Collateral” (as defined in the Credit Agreement and
as defined in any other Loan Document) or any other collateral in which the Borrowers or the
Guarantor has granted (or may hereafter grant) the Bank a Lien, (ii) any right to redeem, under UCC
Section 11-9-623, any “Collateral” (as defined in the Credit Agreement and as defined in any other
Loan Document) or any other collateral in which the Borrowers or the Guarantor has granted (or may
hereafter grant) the Agent and/or the Lenders a Lien, and (iii) any other right which the Borrowers
and the Guarantor may waive under the UCC (whether before or after default). Any notice required
to be given by the Agent and/or the Lenders to the Borrowers and/or the Guarantor (which may not
otherwise be waived under the UCC), may be given by the Agent and the Lenders in the shortest time
period permitted by the UCC, notwithstanding any provision of the Loan Documents requiring a longer
notice period; where “reasonable” notice is required under the UCC and cannot be waived, 10 days’
notice shall be deemed “reasonable” notice for purposes of the Credit

6

 

Agreement and each other Loan Document (except for circumstances described in UCC Section
11-9-611(d)).

     Section 5.3 Waiver of Trial by Jury. IN RECOGNITION OF THE HIGHER COSTS AND DELAY WHICH MAY
RESULT FROM A JURY TRIAL, THE PARTIES HERETO WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING
IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

     Section 5.4 Relief From Stay. (a) In entering into this Amendment, each of the Borrowers, the
Guarantor, the Agent and the Lenders hereby stipulate, acknowledge and agree that each of the Agent
and the Lenders gave up valuable rights and agreed to forbear from exercising legal remedies
available to it in exchange for the promises, representations, acknowledgments and warranties of
each of the Borrowers and the Guarantor as contained herein, and that each of the Agent and the
Lenders would not have entered into this Amendment but for such promises, representations,
acknowledgments, agreements, and warranties, all of which have been accepted by the Agent and the
Lenders in good faith, the breach of which by the Borrowers and/or the Guarantor in any way, at any
time, now or in the future, would admittedly and confessedly constitute cause for dismissal of any
such bankruptcy petition pursuant to 11 U.S.C. § 1112(b).

(b) As additional consideration for the Bank agreeing to forbear from immediately enforcing its
rights and remedies under this Amendment and in the Loan Documents, including but not limited to
the institution of foreclosure proceedings, each of the Borrowers and the Guarantor agrees that in
the event a bankruptcy petition under any Chapter of the Bankruptcy Code (11 U.S.C. §101, et seq.)
is filed by or against the Borrowers and/or the Guarantor at any time after the execution of this
Amendment, each of the Agent and the Lenders shall be entitled to the immediate entry of an order
from the appropriate bankruptcy court granting the Agent and the Lenders complete relief from the
automatic stay imposed by §362 of the Bankruptcy Code (11 U.S.C. §362) to exercise its foreclosure
and other rights, including but not limited to obtaining a foreclosure judgment and foreclosure
sale, upon the filing with the appropriate court of a motion for relief from the automatic stay
with a copy of this Amendment attached thereto. Each of the Borrowers and the Guarantor
specifically agrees (i) that upon filing a motion for relief from the automatic stay, each of the
Agent and the Lenders shall be entitled to relief from the stay without the necessity of an
evidentiary hearing and without the necessity or requirement of the Agent and the Lenders to
establish or prove the value of the Collateral, the lack of adequate protection of its interest in
the Collateral, or the lack of equity in the Collateral; (ii) that the lifting of the automatic
stay hereunder by the appropriate bankruptcy court shall be deemed to be “for cause” pursuant to
§362(d)(1) of the Bankruptcy Code (11 U.S.C. §362(d)(1)); (iii) that it will not

7

 

directly or indirectly oppose or otherwise defend against the Agent’s and/or the Lenders’ efforts
to gain relief from the automatic stay, and (iv) each of the Agent and the Lenders shall be
entitled to recover from the Borrowers and the Guarantor all of the Agent’s and the Lenders’ costs
and expenses (including the Bank’s attorneys fees) incurred in connection with any bankruptcy or
insolvency proceeding of any of them. This provision is not intended to preclude the Borrowers or
the Guarantor from filing for protection under any Chapter of the Bankruptcy Code. The remedies
prescribed in this paragraph are not exclusive and shall not limit the Agent’s and the Lenders’
rights under the Credit Agreement or under any other Loan Document or under any law.

(c) All of the above terms and conditions have been freely bargained for and are all supported by
reasonable and adequate consideration and the provisions herein are material inducements for the
Agent and the Lenders entering into this Amendment.

ARTICLE 6.

Conditions to Effectiveness 

     Section 6.1 Conditions. The amendments to the Credit Agreement set forth in this Amendment,
the Consent and the Waiver Covenant, shall become effective as of February 28, 2011 (the “Effective
Date”) after all of the conditions set forth in this Article hereof shall have been satisfied to
Agent’s and Lenders’ sole discretion.

     Section 6.2 Execution of Amendment. The Borrowers shall have executed and delivered this
Amendment.

     Section 6.3 Execution of Amendments to Revolving Notes. The Borrowers shall have executed and
delivered amendments to each of the Revolving Notes, which amendments shall be in form and
substance satisfactory to the Agent and the Lenders.

     Section 6.4 Confirmation of Ordway Guaranty. Guarantor shall have executed and delivered a
confirmation of his Guaranty agreement and other Loan Documents executed by him in favor of the
Agent and the Lenders, which confirmation shall be in form and substance satisfactory to the Agent
and the Lenders.

     Section 6.5 Borrowers’ and Guarantor’s Counsel’s Opinion. The Agent and the Lenders shall
have received the approving legal opinion of counsel to the Borrowers and Guarantor, in form and
substance satisfactory to the Agent and the Lenders.

     Section 6.6 Representations and Warranties. (a) As of the Effective Date, the representations
and warranties set forth in the Credit Agreement, and the representations and warranties set forth
in each of the Loan Documents, shall be true and correct in all material respects; (b) as of the
Effective Date, no Defaults or Events of Default shall have occurred and be continuing, other than
the Existing Defaults that are the subject of the Waiver Covenant; (c) the Bank shall have received
from the Borrower a certificate dated the Effective Date, certifying the matters set forth in
subsections (a) and (b) of this Section, which certificate shall be in form and substance
satisfactory to the Bank.

8

 

     Section 6.7 Fox Stock Transfer. Borrowers and the Intermediate Purchase shall have effected
the Fox Stock Transfer pursuant to the Stock Purchase Agreement, which agreement, and the other
documents in connection with the Fox Stock Transfer, shall be in form and substance satisfactory to
the Agent and the Lenders. Parent shall have received cash in the amount of at least $250,000 and
800,000 shares of stock of the Parent with a value of not less than $3,272,000 (which shall be held
in treasury by Parent as described herein).

     Section 6.8 New Fox Asset Transfer. Fox and New Fox shall have effected the New Fox Asset
Transfer pursuant to the Asset Purchase Agreement, between the Intermediate Purchase, Fox and New
Fox, which agreement, and the other documents in connection with New Fox Asset Transfer, shall be
in form and substance satisfactory to the Agent and the Lenders.

     Section 6.9 Southeastern Real Estate Transfer; Fox Mortgage Assumption. The Fox and
Southeastern shall have effected the Southeastern Real Estate Transfer pursuant to the Real Estate
Purchase Contract and a related Limited Warranty Deed, dated as of March 1, 2011, from Fox to
Southeastern, which agreement, and the other documents in connection with Southeastern Real Estate
Transfer (including, without limitation, the Fox Mortgage Assumption), shall be in form and
substance satisfactory to the Agent and the Lenders.

     Section 6.10 Fox Release. The Intermediate Purchaser, Fox, Southeastern and New Fox shall have
executed a mutual release agreement with the Agent and the Lenders, in form and substance
satisfactory to the Agent and the Lenders.

     Section 6.11 Revolving Loan Paydown. The Borrowers shall have paid to the Agent (for
distribution to the Lenders in accordance with their Applicable Percentages) at least $250,000 for
application the outstanding principal balance of the Revolving Loans.

     Section 6.12 Waiver Fee. The Borrowers shall have paid to the Agent (for distribution to the
Lenders in accordance with their Applicable Percentages) a waiver and amendment fee of $43,000,
which fee has been fully earned by the Lenders and is non-refundable in its entirety.

     Section 6.13 Expenses. The Borrowers shall have paid all costs and expenses of the Agent and
the Lenders in connection with the transactions contemplated hereby, including fees and expenses of
the Agent’s and the Lenders’ counsel, title insurance premiums and expenses, recording costs, and
any other out-of-pocket expenses of the Agent and the Lenders.

ARTICLE 7.

Miscellaneous

     Section 7.1 Entire Agreement; No Novation or Release. This Amendment, together with the Loan
Documents, as in effect on the Effective Date, reflects the entire understanding with respect to
the subject matter contained herein, and supersedes any prior agreements, whether written or oral.
This Amendment is not intended to be, and shall not be deemed or construed to be, a satisfaction,
novation or release of the Credit Agreement or any other Loan Document. Except as expressly amended
hereby, all representations, warranties, terms,

9

 

covenants and conditions of the Credit Agreement and the other Loan Documents shall remain
unamended and unwaived and shall continue in full force and effect.

     Section 7.2 Fees and Expenses. All fees and expenses of the Agent and Lenders incurred in
connection with the issuance, preparation and closing of the transactions contemplated hereby shall
be payable by the Borrowers promptly upon the submission of the bill therefor. If the Borrowers
shall fail to promptly pay such bill, the Agent and Lenders are authorized to pay such bill through
an Advance of funds under the Revolving Facility or by debiting the Borrowers’ accounts with the
Agent and Lenders to pay the same.

     Section 7.3 Choice of Law; Successors and Assigns. This Amendment shall be construed and
enforced in accordance with and governed by the internal laws (as opposed to the conflicts of laws
provisions) of the State of Georgia. This Amendment shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns. This Amendment may be
signed in multiple counterparts.

10

 

WITNESS the hand and seal of each of the undersigned as of the date first written above.

	 	 	 	 	 
	 	Agent:

RBC BANK (USA), as Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	RBC:

RBC BANK (USA), as a Lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	CSB:

COMMUNITY & SOUTHERN BANK, as a Lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

11

 

	 	 	 	 	 

	 	 	 	 	 
	 	BORROWERS:

VIDEO DISPLAY CORPORATION

 	 
	 	By:  	 	 
	 	 	Ronald D. Ordway, Chief Executive Officer 	 
	 	 	 	 
	 
	 	LEXEL IMAGING SYSTEMS, INC.

 	 
	 	By:  	 	 
	 	 	Ronald D. Ordway, Chief Executive Officer 	 
	 	 	 	 
	 
	 	Z-AXIS, INC.

 	 
	 	By:  	 	 
	 	 	Ronald D. Ordway, Chief Executive Officer 	 
	 	 	 	 
	 
	 	TELTRON TECHNOLOGIES, INC.

 	 
	 	By:  	 	 
	 	 	Ronald D. Ordway, Chief Executive Officer 	 
	 	 	 	 
	 
	 	AYDIN DISPLAYS, INC.

 	 
	 	By:  	 	 
	 	 	Ronald D. Ordway, Chief Executive Officer 	 
	 	 	 	 
	 

The Undersigned has executed this Amendment for the purposes of making, and being bound by, the
representations, warranties, covenants, waivers and releases applicable to the “Guarantor” herein.

	 	 	 	 	 
	 	 	 
	 	
 	 
	 	RONALD D. ORDWAY 	 
	 	 	 

12

 

	 	 	 	 	 

SCHEDULE 2.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

	 	 	 	 	 	 	 	 	 
	Lender	 	Revolving 

Commitment	 	 	Applicable 

Percentage	 
	 
	RBC Bank (USA)
	 	$	9,000,000	 	 	 	60.00	%
	Community & Southern
Bank
	 	$	6,000,000	 	 	 	40.00	%
	Total
	 	$	15,000,000	 	 	 	100.00	%

	 	 	 	 	 	 	 	 	 
	Lender	 	Term 

Loan A 

Commitment*	 	 	Applicable 

Percentage	 
	 
	RBC Bank (USA)
	 	$	2,100,000	 	 	 	60.00	%
	Community & Southern
Bank
	 	$	1,400,000	 	 	 	40.00	%
	Total
	 	$	3,500,000	 	 	 	100.00	%

	 	 	 	 	 	 	 	 	 
	Lender	 	Term 

Loan B 

Commitment*	 	 	Applicable 

Percentage	 
	 
	RBC Bank (USA)
	 	$	1,800,000	 	 	 	60.00	%
	Community & Southern
Bank
	 	$	1,200,000	 	 	 	40.00	%
	Total
	 	$	3,000,000	 	 	 	100.00	%

 

			
	*	 	Original Commitment; does not reflect any repayments to date.

13

 

SCHEDULE 5.13

SUBSIDIARIES

AND OTHER EQUITY INVESTMENTS

[AND EQUITY INTERESTS IN BORROWER]

	Part (a). 	 	 Subsidiaries.
	 
	Part (b). 	 	 Other Equity Investments.
	 
	Part (c). 	 	 Owners of Equity Interests in each Borrower.

14exv10w1

Exhibit 10.1

OM GROUP, INC.

EXECUTIVE SEVERANCE PLAN

This Executive Severance Plan, effective as of __________, 2011 (the “Effective Date”), of
OM Group, Inc. is for the benefit of certain employees of the Company and its Subsidiaries, on the
terms and conditions hereinafter stated. Each Subsidiary will be responsible for providing the
benefits to which its employees (who are designated as Eligible Employees) may become entitled
hereunder. The Company agrees unconditionally to guarantee the performance by, and obligation of,
each Subsidiary under this Plan.

This Plan, as set forth herein, is intended to help retain qualified and valued employees, maintain
a stable work environment, and provide economic security to Eligible Employees in the event of
certain terminations of employment. This 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 §
2510.3-2(b).

	1.	 	DEFINITIONS.

As used in this Plan:

	1.1	 	“Affiliate” means any company controlled by, controlling, or under common control
with, the Company.
	 
	1.2	 	“Annual Bonus” means, with respect to an Eligible Employee, an amount equal to the
Eligible Employee’s average actual annual cash bonus for the three most recently completed
fiscal years (or for such lesser period of time as the Eligible Employee has been employed by
the Employer).
	 
	1.3	 	“Base Salary” means, with respect to an Eligible Employee, the Eligible Employee’s
annual base salary as of the Severance Date.
	 
	1.4	 	“Board” means the Board of Directors of the Company.
	 
	1.5	 	“Cause” means, for purposes of a termination of an Eligible Employee’s employment
with the Company and its Affiliates: (A) the Eligible Employee’s commission of a felony
(other than felonious operation of a motor vehicle); (B) the Eligible Employee’s commission of
fraud, embezzlement or misappropriation of funds, in each case involving or against the
Company or any of its Subsidiaries or Affiliates; (C) the Eligible Employee’s commission of an
act or series of acts of dishonesty in the course of the Eligible Employee’s employment that
are materially inimical to the best interests of the Company or a Subsidiary, as determined by
action of the Board (taken by a majority of the full number of directors then in office) and,
if the act or acts are capable of being cured, the Eligible Employee fails to cure or take all
reasonable steps to cure within 30 days of notice from the Company to the Eligible Employee;
(D) the Eligible Employee’s

1

 

	 	 	engagement in Competitive Activity for more than 10 days after the Board has, by action of
the Board (taken by a majority of the full number of directors then in office), advised the
Eligible Employee in writing to cease such Competitive Activity; or (E) other than as a
result of Disability, the Eligible Employee consistently fails to perform his duties and
responsibilities as specified from time to time for 30 consecutive days after the Board has,
by action of the Board (taken by a majority of the full number of directors then in office),
advised him in writing of that failure.

	1.6	 	“CEO” means the Eligible Employee serving as the Chief Executive Officer of the
Company.
	 
	1.7	 	“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
from time to time.
	 
	1.8	 	“Code” means the Internal Revenue Code of 1986, as it may be amended from time to
time, including, without limitation, any rules and regulations promulgated thereunder, along
with Treasury and Internal Revenue Service interpretations thereof.
	 
	1.9	 	“Common Stock” means the shares of common stock, $0.01 par value per share, of the
Company or any security into which such shares of common stock may be changed by reason of any
transaction or similar event.
	 
	1.10	 	“Company” means OM Group, Inc., a Delaware corporation.
	 
	1.11	 	“Compensation Committee” means the Compensation Committee of the Board.
	 
	1.12	 	“Competitive Activity” means an Eligible Employee’s participation, without the prior
written consent of the Board, in the management of any business enterprise if such enterprise
engages in substantial and direct competition with the Company or any of its Subsidiaries or
Affiliates and such enterprise’s sales of any product or service competitive with any product
or service of the Company or any of its Subsidiaries or Affiliates amounted to 10% of such
enterprise’s net sales for its most recently completed fiscal year and the Company’s and its
Subsidiaries’ and Affiliates’ aggregate net sales of said product or service amounted to 10%
of the Company’s and its Subsidiaries’ and Affiliates’ aggregate net sales for the Company’s
most recently completed fiscal year; provided, however, that Competitive
Activity will not include (A) the mere ownership of securities in any such enterprise or the
exercise of rights appurtenant thereto or (B) participation in the management of any such
enterprise other than in connection with the competitive operations of such enterprise.
	 
	1.13	 	“Disability” means an Eligible Employee’s physical or mental incapacitation for a
period of 180 consecutive days such that the Eligible Employee cannot substantially perform
his duties of employment with the Employer on a full-time basis.
	 
	1.14	 	“Eligible Employee” means an Executive Officer of the Company who is designated as an
Eligible Employee by the Compensation Committee or its designee and who accepts participation
herein in such manner as shall be prescribed by the Company.

- 2 -

 

	1.15	 	“Employer” means, with respect to an Eligible Employee, the Company, or, if the
Eligible Employee is not employed by the Company, then the Subsidiary which employs the
Eligible Employee, or any successor thereto.
	 
	1.16	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	1.17	 	“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder, as such law, rules and regulations may be amended from time to
time.
	 
	1.18	 	“Executive Officer” means those Eligible Employees serving as executive officers, as
that term is defined in Rule 3b-7 under the Securities Exchange Act of 1934.
	 
	1.19	 	“Good Reason” means:

	 	(A)	 	for the CEO, the occurrence of any of the following events without the CEO’s
written consent:

	 	(1)	 	the CEO’s Base Salary is reduced from the highest level in
effect at any time;
	 
	 	(2)	 	the CEO is excluded from full participation in any incentive,
option, restricted stock or other compensatory plan that is generally available
to Executive Officers of the Company; provided, however, that
the CEO’s participation does not in any way guarantee payments under any such
plan;
	 
	 	(3)	 	the CEO determines in good faith that his responsibilities,
duties or authorities are materially reduced from that consistent with his
positions as Chairman of the Board and Chief Executive Officer (including
status, offices, titles and reporting requirements) and the reduction is not
cured within 30 days after he provides notice to the Board of his election to
terminate his employment based upon that reduction;
	 
	 	(4)	 	(a) the Board has adopted, explicitly or implicitly, a
strategic plan for the Company without the CEO’s approval that varies
materially from the strategic plan of the Company as that plan existed
immediately prior to the 60-day period, (b) the CEO notifies the Board in
writing of his disapproval of such strategic plan during the 60-day period, and
(c) less than 12 months prior to or contemporaneous with the adoption of such
strategic plan, two or more individuals have become directors of the Company by
any action other than the approval of at least two-thirds of the directors
comprising the Board (either by a specific vote or by approval of a proxy
statement of the Company in which each such person is named as a nominee for
director, without objection to such nomination), which action may, by way of
example and not limitation, be the result of an actual or threatened
solicitation of proxies or consents by or on behalf of a person other than the
Board. For purposes of this Section 1.19(A)(4), the term

- 3 -

 

	 	 	 	“60-day period” means the 60-day period prior to the CEO’s notice to the
Company under this Section 1.19(C) of the CEO’s notice to the Company and
the Employer of the initial existence of the condition(s) constituting Good
Reason;

	 	(5)	 	the CEO ceases for any reason (other than death, Disability or
voluntary resignation) to be a member of the Board; or
	 
	 	(6)	 	the Company has provided notice to the CEO of its determination
not to extend the term of the Amended and Restated Change in Control Agreement,
dated November 13, 2006, between the CEO and the Company; and

	 	(B)	 	for any Eligible Employee other than the CEO, the occurrence of any of the
following events without such Eligible Employee’s written consent:

	 	(1)	 	the assignment of any duties materially inconsistent with the
Eligible Employee’s position (including status, offices, titles and reporting
requirements and reporting structure), authority, duties or responsibilities,
or any other action by the Company which results in a diminution in such
position, authority, duties or responsibilities, excluding for this purpose an
isolated, insubstantial and inadvertent action not taken in bad faith and which
is remedied by the Company promptly after receipt of notice thereof given by
the Eligible Employee;
	 
	 	(2)	 	any material diminution in the Eligible Employee’s annual base
salary, employee benefits and opportunity to earn incentive and bonus
compensation, other than an isolated, insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by the Company promptly after the
receipt of notice thereof given by the Eligible Employee; or
	 
	 	(3)	 	the Company has provided notice to such Eligible Employee of
its determination not to extend the term of the Eligible Employee’s CIC
Agreement (as defined in Section 2.1 below).

	 	(C)	 	Notwithstanding the foregoing, in the case of both Section 1.19(A) and 1.19(B),
none of the circumstances described above may serve as the basis for Good Reason unless
(1) the Eligible Employee provides written notice to the Company and the Employer
within 60 days of the initial existence of the condition(s) constituting Good Reason
and (2) the Company and the Employer fail to cure such condition(s) within 30 days
after receipt from the Eligible Employee of such notice; provided that Good
Reason will cease to exist with respect to a condition two years following the initial
existence of such condition (but if the Eligible Employee does not claim Good Reason as
a result of a condition within such period, the Eligible Employee will not be deemed to
have waived the right to

- 4 -

 

	 	 	 	claim Good Reason upon the existence or occurrence of a subsequent (or similar)
condition).

	1.20	 	“Person” means any “person” as such term is used for purposes of Section 13(d) or
14(d) of the Exchange Act.
	 
	1.21	 	“Plan” means this Executive Severance Plan of OM Group, Inc., as set forth herein, as
it may be amended from time to time.
	 
	1.22	 	“Plan Administrator” means the person or persons appointed from time to time by the
Compensation Committee, which appointment may be revoked at any time by the Compensation
Committee.
	 
	1.23	 	“Pro Rata Bonus” means, with respect to an Eligible Employee, an amount equal to the
Eligible Employee’s Base Salary actually earned by the Eligible Employee for the portion of
the year in which the Severance Date occurs ending on the Severance Date multiplied by the
performance multiple actually used by the Compensation Committee to determine annual bonuses
for the Executive Officers for the year in which the Severance Date occurs pursuant to the
Compensation Committee’s then-standard practices.
	 
	1.24	 	“Section 409A” means Section 409A of the Code, and the rules, regulations and
guidance promulgated thereunder by the U.S. Department of the Treasury or the U.S. Internal
Revenue Service
	 
	1.25	 	“Severance” means (A) for any Eligible Employee, the involuntary termination of the
Eligible Employee’s employment by the Employer without Cause (other than due to death or
Disability), (B) for any Eligible Employee, a voluntary termination of the Eligible Employee’s
employment for Good Reason, or (C) for only the CEO serving as of the Effective Date, the
termination of that CEO’s employment due to death or Disability; provided,
however, that a Severance shall not occur by reason of the divestiture of a facility,
sale of a business or business unit, or the outsourcing of a business activity with which an
Eligible Employee is affiliated if (X) the Eligible Employee is provided comparable employment
(e.g., with a Base Salary and Annual Bonus at least equal to that in effect immediately prior
to such transfer of employment) by the entity which acquires such facility, business or
business unit or which succeeds to such outsourced business activity; and (Y) such entity
continues to cover the Eligible Employee under a severance program which provides severance
benefits no less favorable than this Plan for at least 12 months.
	 
	1.26	 	“Severance Date” means, with respect to an Eligible Employee, the date on which the
Eligible Employee incurs a Severance.
	 
	1.27	 	“Subsidiary” means a corporation, company or other entity (A) more than 50% of whose
outstanding shares or securities (representing the right to vote for the election of directors
or other managing authority) are, or (B) which does not have outstanding shares or securities
(as may be the case in a partnership, limited liability company, joint venture or
unincorporated association), but more than 50% of whose ownership interest representing

- 5 -

 

	 	 	the right generally to make decisions for such other entity is, now or hereafter, owned or
controlled, directly or indirectly, by the Company.

	2.	 	SEVERANCE BENEFITS.
	 
	2.1	 	General. Each Eligible Employee shall be entitled to severance payments and benefits
pursuant to the applicable provisions of this Section 2 if the Eligible Employee
incurs a Severance and the Eligible Employee is not otherwise entitled to receive payments and
benefits under any change in control severance agreement with the Company (a “CIC
Agreement”), as a result of the Severance; provided, however, that,
notwithstanding anything in this Plan to the contrary, upon an Eligible Employee becoming a
participant in this Plan, the Eligible Employee shall cease to participate in any other
severance plan, program, agreement or arrangement maintained by the Company or any Subsidiary
or Affiliate other than a CIC Agreement (and, to the extent required by Section 409A, the
payment terms under any such plan, program agreement or arrangement are hereby deemed to be
amended to be consistent with the payment terms hereinafter set forth).
	 
	2.2	 	Cash Payment. Each Eligible Employee who incurs a Severance shall be entitled to a
single lump sum cash payment, payable (subject to Section 9 of this Plan) on the
60th day following the Severance Date, in an amount equal to the sum of:

	 	(A)	 	Two times Base Salary in the case of the CEO, and one and a half times Base
Salary in the case of any Eligible Employee other than the CEO; and
	 
	 	(B)	 	Two times Annual Bonus in the case of the CEO, and one and a half times Annual
Bonus in the case of any Eligible Employee other than the CEO.

	2.3	 	Pro Rata Bonus. Each Eligible Employee who incurs a Severance more than 90 days after
the start of the Company’s fiscal year in which the Severance occurs shall be entitled to a
single lump sum cash payment of the Pro Rata Bonus, which payment will be payable (subject to
Section 9 of this Plan) in the year following the year in which the Severance Date occurs on
the same date that the annual cash bonus for the year in which the Severance Date occurs would
have been paid if the Eligible Employee had not incurred a Severance, but in any event not
later than March 15 of the calendar year following the calendar year in which the Severance
Date occurs.
	 
	2.4	 	Health Benefits. Each Eligible Employee who incurs a Severance shall be entitled to
continue as a plan participant in the Company’s health and dental insurance plans (the
“Health Plans”) in which he is enrolled on the Severance Date for, in the case of the
CEO, 24 months after the Severance Date and, in the case of any Eligible Employee other than
the CEO, 18 months after the Severance Date, subject in either case to the terms and
conditions of the Health Plans and to the determinations of any person or committee
administering such Health Plans; provided, however, that the benefits
otherwise receivable by the Eligible Employee pursuant to this Section 2.4 will be reduced to
the extent comparable benefits are actually received by the Eligible Employee from another
employer or employer group health plan during the period described in this sentence, and any
such benefits actually received by the Eligible Employee shall be reported by him to

- 6 -

 

	 	 	the Company. The Company reserves the right to modify, terminate or replace any Health
Plan, provided that any such modification, termination or replacement applies to the
Company’s employees generally and not just to one or more Eligible Employees. During the
period described in the first sentence of this Section 2.4, the Eligible Executive shall
make timely payments of any participant contributions in the amount that would be applicable
to the Eligible Employee if he was then enrolled in a similar level of Health Plans coverage
as an active Company employee. The Eligible Employee’s continued participation in the
Health Plans pursuant to this Section 2.4 shall satisfy the Health Plans’ obligation to
provide the Eligible Employee the right to continuation coverage under the Health Plans
pursuant to COBRA. If and to the extent that the benefits described in this Section 2.4 are
not or cannot be paid or provided under any policy, plan, program or arrangement of the
Company, then the Company will itself pay or provide for the payment to each Eligible
Employee, his dependents and beneficiaries, of such benefit.

	2.5	 	Equity Awards. In the case of each Eligible Employee who incurs a Severance,
notwithstanding the terms of any equity agreement: (A) all of the Eligible Employee’s
outstanding equity awards (including, without limitation, any stock options, stock
appreciation rights, restricted stock and restricted stock units) that have not vested by the
Severance Date will be forfeited; and (B) all of the Eligible Employee’s outstanding and
vested stock options as of the Severance Date will remain exercisable for three months after
the Severance Date (but in no event later than the date of expiration of the original term of
such stock options).
	 
	2.6	 	Outplacement Services. In the case of each Eligible Employee who incurs a Severance,
the Employer shall reimburse the Eligible Employee for third-party outplacement services, the
reasonable scope and provider of which are mutually acceptable to both the Eligible Employee
and the Employer, for a period of 12 months immediately following the Severance Date or, if
earlier, until the first acceptance by the Eligible Employee of an offer of employment;
provided, however, that in no case shall the Employer be required to reimburse
any amount in excess of $25,000 for outplacement services in the case of the CEO or $10,000
for outplacement services in the case of any Eligible Employee other than the CEO.
Notwithstanding anything herein to the contrary, all reimbursements pursuant to this
Section 2.6 shall be reimbursed by the Employer within 45 days (or, if applicable, on
the Permissible Payment Date) following the date on which the Employer receives the applicable
invoice from the applicable Eligible Employee (and approves such invoice) but in no event
later than December 31st of the third calendar year following the year in which the
Severance Date occurs.
	 
	2.7	 	Release. Notwithstanding the foregoing, as a condition to the payment or receipt of
any payment or benefit pursuant to the applicable provision of this Section 2, each
Eligible Employee shall be required to execute and not revoke (within the seven day revocation
period) an effective general waiver and release of claims agreement in favor of the Company
and its Subsidiaries and Affiliates, substantially in the form attached hereto as Exhibit
A, before the 60th day following the Eligible Employee’s Severance Date.

- 7 -

 

	3.	 	POTENTIAL PAYMENT AND BENEFIT REDUCTION.
	 
	3.1	 	Notwithstanding any other provisions in this Plan, in the event that any payment or benefit
received or to be received by an Eligible Employee (including, without limitation, any payment
or benefit received in connection with a Change in Control (as defined in the Company’s form
Amended and Restated Change in Control Agreement filed with the Company’s Annual Report on
Form 10-K for the year ended December 31, 2010 as Exhibit 10.33) or the termination of the
Eligible Employee’s employment, whether pursuant to the terms of this Plan or any other plan,
program, arrangement or agreement) (all such payments and benefits, together, the “Total
Payments”) would be subject (in whole or part), to any excise tax imposed under Section
4999 of the Code, or any successor provision thereto (the “Excise Tax”), then, after
taking into account any reduction in the Total Payments provided by reason of Section 280G of
the Code in such other plan, program, arrangement or agreement, the Employer will reduce the
Eligible Employee’s payments and/or benefits under this Plan, to the extent necessary so that
no portion of the Total Payments is subject to the Excise Tax (but in no event to less than
zero), in the following order: (A) the outplacement reimbursements described in Section
2.6; (B) the lump sum cash payment described in Section 2.2; and (C) the lump sum
cash payment described in Section 2.3 (the payments and benefits set forth in clauses
(A) through (C), together, the “Potential Payments”); provided,
however, that the Potential Payments shall only be reduced if (X) the net amount of
such Total Payments, as so reduced (and after subtracting the net amount of federal, state,
municipal and local income taxes on such reduced Total Payments and after taking into account
the phase out of itemized deductions and personal exemptions attributable to such reduced
Total Payments), is greater than or equal to (Y) the net amount of such Total Payments without
such reduction (but after subtracting the net amount of federal, state, municipal and local
income taxes on such Total Payments and the amount of Excise Tax to which the Eligible
Employee would be subject in respect of such unreduced Total Payments and after taking into
account the phase out of itemized deductions and personal exemptions attributable to such
unreduced Total Payments).
	 
	3.2	 	For purposes of determining whether and the extent to which the Total Payments will be
subject to the Excise Tax: (A) no portion of the Total Payments the receipt or enjoyment of
which the Eligible 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; (B) no portion of the Total Payments shall be taken into account which, in the
opinion of tax counsel (“Tax Counsel”) reasonably acceptable to the Eligible Employee
and selected by the accounting firm which was, immediately prior to the Severance Date, 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, without limitation,
by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion
of such Total Payments shall be taken into account which, in the opinion of Tax Counsel,
constitutes 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 set forth in Section
280G(b)(3) of the Code) that is allocable to such reasonable compensation; and (C) the value
of any non-cash benefit or any deferred

- 8 -

 

	 	 	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.

	3.3	 	At the time that payments are made under this Plan, the Employer shall provide the Eligible
Employee with a written statement setting forth the manner in which such payments were
calculated and the basis for such calculations, including, without limitation, any opinions or
other advice the Employer received from Tax Counsel, the Auditor, or other advisors or
consultants (and any such opinions or advice which are in writing shall be attached to the
statement). If the Eligible Employee objects to the Employer’s calculations, the Employer
shall pay to the Eligible Employee such portion of the Potential Payments (up to 100% thereof)
as the Eligible Employee determines is necessary to result in the proper application of this
Section 3. All determinations required by this Section 3 (or requested by
either the Eligible Employee or the Employer in connection with this Section 3) shall
be at the expense of the Employer. The fact that an Eligible Employee’s right to payments or
benefits may be reduced by reason of the limitations contained in this Section 3
shall not of itself limit or otherwise affect any other rights of the Eligible Employee under
this Plan.

	4.	 	PLAN ADMINISTRATION.

	4.1	 	The Plan Administrator shall administer this Plan and may interpret this Plan, prescribe,
amend and rescind rules and regulations under this Plan and make all other determinations
necessary or advisable for the administration of this Plan, subject to all of the provisions
of this Plan.
	 
	4.2	 	The Plan Administrator may delegate any of its duties hereunder to such person or persons
from time to time as it may designate.
	 
	4.3	 	The Plan Administrator is empowered, on behalf of this 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 this 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
this Plan. Such persons shall exercise no discretionary authority or discretionary control
respecting the management of this Plan. All reasonable expenses thereof shall be borne by the
Company.

	5.	 	CONFIDENTIALITY, NON-SOLICITATION AND NON-COMPETITION.
	 
	 	 	Upon becoming a participant in this Plan, each Eligible Employee acknowledges and agrees to
the provisions set forth in this Section 5.
	 
	5.1	 	Non-Disclosure.

	 	(A)	 	As a consequence of each Eligible Employee’s employment with the Company, the
Eligible Employee has received and will continue to receive and deal with, Confidential
Information (as defined below). The Confidential Information received or dealt with,
and to be received or dealt with, by the Eligible Employee

- 9 -

 

	 	 	 	is of such a value and nature that the Company will be irreparably damaged if the
Eligible Employee were to disclose any of the Confidential Information that he has
received or dealt with, or will receive or deal with, as a result of his employment
with the Company. All Confidential Information and other information regarding the
Company compiled or obtained by each Eligible Employee or furnished to him in
connection with his employment with the Company is Confidential Information. Each
Eligible Employee agrees not to use, disclose, disseminate or publish to any person,
firm or entity any Confidential Information at any time during or after his
employment with the Employer.

	 	(B)	 	For purposes of this Plan, “Confidential Information” is considered to include,
without limitation, operating policies and procedures, financial information, sales
information, the identity and lists of actual and potential customers with whom the
Company has contact, potential target entities of the Company, and any other
information relating to the business of the Company, all to the extent that such
information is not intended by the Company for dissemination publicly. “Confidential
Information” does not include information that: (1) is or later becomes publicly
available in a manner wholly unrelated to any breach of this Section 5.1 by an Eligible
Employee; (2) was rightfully possessed by an Eligible Employee prior to his receipt of
such information from the Company, excluding client information and other Confidential
Information that he has assigned to the Company; or (iii) is subsequently furnished
rightfully to an Eligible Employee by a third party not known by him to be under any
restriction on use or disclosure of such information
	 
	 	(C)	 	Each Eligible Employee agrees that, upon termination of his employment with the
Company, he will promptly return to the Company all Confidential Information relating
to the Company’s business that he possesses or has under his control, whether in
written, electronic or other form.

	5.2	 	No Solicitation. The Eligible Employee hereby agrees and covenants that during the
Eligible Employee’s employment with the Company or any of its Affiliates, and for a period of
24 months thereafter in the case of the CEO and 18 months thereafter in the case of any
Eligible Employee other than the CEO, so long as the Company and its Affiliates are not in
material breach of this Plan, the Eligible Employee shall not, directly or indirectly, on his
own behalf or with others: (A) induce or attempt to induce any employee of the Company or its
Affiliates who is (or was at any time during the most recent 90 days that the Eligible
Employee was employed by, or providing services to, the Company or its Affiliates) an
employee, officer, consultant or agent of the Company or its Affiliates (a “Protected
Employee”) to leave the employ of the Company and its Affiliates, or in any way interfere
with the relationship between the Company and its Affiliates and any Protected Employee,
except that it is specifically agreed by the Eligible Employee and the Company that this
Section 5.2 is not violated by any response by a Protected Employee to a publicly
announced job opening with the Eligible Employee or his subsequent employer whether such
announcement appears in newspapers, trade publications, web sites or similar public media; (B)
induce or attempt to induce any referral source, customer or other business relation of the
Company or its Affiliates not to

- 10 -

 

	 	 	do business with the Company and its Affiliates, or to cease doing business with the Company
and its Affiliates; or (C) solicit, divert or actively take away, or attempt to solicit,
divert or take away, for purposes of conducting a business substantially similar to the
business of the Company or its Affiliates, any individual, corporation, partnership or other
association or entity who, as of the Severance Date, both (X) had a business relationship
with the Company or its Affiliates or, to the Eligible Employee’s knowledge, was during the
90-day period preceding the Severance Date solicited in writing by the Company or its
Affiliates for business (whether or not he or it became an actual customer) and (Y) was
personally contacted by the Eligible Employee during such 90-day period; provided,
however, that the foregoing provisions of this Section 5.2 shall not
prohibit the Eligible Employee from participating in any response to an open bidding or
quote request of any customer of the Company or its Affiliates, or prohibit the Eligible
Employee from any solicitation that does not, directly or indirectly, divert business from
the Company and its Affiliates; and, provided further, that the Eligible Employee
and any subsequent employer may in the ordinary course of business compete with the Company
and its Affiliates for customers, properties or otherwise, without violating this
Section 5.2, provided that the Eligible Employee shall not attempt to induce
any entity with which the Company or its Affiliates has any existing business relationship
to terminate that business relationship prior to the termination of existing contracts or
orders with that entity.

	5.3	 	Non-Competition. Each Eligible Employee also acknowledges and agrees that, during
(A) the Eligible Employee’s employment with the Company or any of its Subsidiaries or
Affiliates and (B) and for a period of 24 months in the case of the CEO and 18 months in the
case of any Eligible Employee other than the CEO immediately following the Eligible Employee’s
Severance Date, the Eligible Employee shall not engage in any Competitive Activity.
	 
	5.4	 	Injunctive Relief. The Eligible Employee acknowledges that it is impossible to
measure in money the damages that will accrue to the Company and its Affiliates by reason of
the Eligible Employee’s failure to observe any of the obligations imposed on him by this
Section 5. Accordingly, if the Company or its Affiliates shall institute an action to
enforce the provisions hereof, the Eligible Employee hereby waives the claim or defense that
an adequate remedy at law is available to the Company or its Affiliates, and the Eligible
Employee agrees not to urge in any such action the claim or defense that such remedy at law
exists.
	 
	5.5	 	Severability. If a final determination is made by a court having competent
jurisdiction that the time or territory or any other restriction contained in Section
5.1, 5.2 or 5.3 is an unenforceable restriction on the Eligible Employee’s
activities, the provisions of such section(s) shall not be rendered void but shall be deemed
amended to apply such maximum time and scope and such other restrictions as such court may
judicially determine or otherwise indicate to be reasonable.

- 11 -

 

	6.	 	PLAN MODIFICATION OR TERMINATION.
	 
	 	 	Notwithstanding anything herein to the contrary, this Plan may be amended or terminated by
the Board or the Compensation Committee at any time with respect to some or all Eligible
Employees; provided, however, that no amendment, termination or suspension
of this Plan that would be adverse to the interests of any Eligible Employee will be
effective except upon one year’s prior written notice to the Eligible Employees unless the
adversely affected Eligible Employees consent to such amendment, termination or suspension
in writing, except that this Plan may be amended at any time and from time to time to comply
with any recapture or “clawback” policy of the Company adopted by the Board to comply with
Section 10D of the Securities Exchange Act of 1934 and any applicable rules or regulations
promulgated by the Securities and Exchange Commission or any national securities exchange or
national securities association on which the Common Stock may be traded, as determined by
the Plan Administrator.
	 
	7.	 	GENERAL PROVISIONS.
	 
	7.1	 	Subject to Section 2.1, if the Company or any Subsidiary or Affiliate is obligated by
law or by contract to pay severance pay, a termination indemnity, notice pay, or the like, or
if the Company or any Subsidiary or Affiliate is obligated by law to provide advance notice of
separation to an Eligible Employee (a “Notice Period”), then any payments to the
Eligible Employee pursuant to Section 2 shall be reduced by the amount of any such
severance pay, termination indemnity, notice pay or the like, as applicable, and by the amount
of any compensation received during any Notice Period.
	 
	7.2	 	Neither the establishment of this 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
Eligible Employee, or any person whomsoever, the right to be retained in the service of the
Company or any Subsidiary or Affiliate, and all Eligible Employees shall remain subject to
discharge to the same extent as if this Plan had never been adopted.
	 
	7.3	 	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.
	 
	7.4	 	The headings and captions herein are provided for reference and convenience only, shall not
be considered part of this Plan, and shall not be employed in the construction of this Plan.
Similarly, the use of the masculine gender with respect to pronouns herein is for purposes of
convenience and refers to either sex who may be an Eligible Employee. Unless otherwise
specified, all Section references herein are to this Plan. Any reference to a day or days
herein refers to a calendar day or days unless otherwise stated.
	 
	7.5	 	This Plan shall not be funded. No Eligible Employee shall have any right to, or interest in,
any assets of the Company (or any of its Subsidiaries or Affiliates) which may be applied by
the Company (or any of its Subsidiaries or Affiliates) to the payment of benefits or other
rights under this Plan. Nothing contained in this Plan, and no action taken pursuant to this
Plan, shall create or be construed to create a trust of any kind, or a

- 12 -

 

	 	 	fiduciary relationship, between the Company (or any of its Subsidiaries or Affiliates) and
any Eligible Employee or any other person. The rights of each Eligible Employee or each
Eligible Employee’s estate to benefits under this Plan shall be solely those of an unsecured
creditor of the Employer.

	7.6	 	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 or its last known address.
	 
	7.7	 	This Plan shall be construed and enforced according to the laws of the State of Ohio, without
reference to principles of conflicts of laws.
	 
	7.8	 	All benefits hereunder shall be reduced by applicable withholding and shall be subject to
applicable tax reporting, as determined by the Plan Administrator.
	 
	7.9	 	Following the Severance Date, if and to the extent requested by the Board, each Eligible
Employee, as applicable, agrees to (A) resign from the Board, and from all fiduciary positions
(including, without limitation, as trustee) and all other offices and positions he holds with
the Company and its Subsidiaries and Affiliates; provided, however, that if
the Eligible Employee refuses to tender his resignation after the Board has made such request,
then the Board will be empowered to tender the Eligible Employee’s resignation or remove the
Eligible Employee from such offices and positions; and (B) assign back to the Company all
stock or other equity securities of all Subsidiaries or Affiliates that he or she may own as a
result of the Company issuing such stock or equity securities to the Eligible Employee as a
nominee or Company-designee.
	 
	7.10	 	This Plan (including the provisions of Section 5 of this Plan) supersedes in their
entirety all of the Company’s prior severance plans, policies or agreements (except for the
CIC Agreements) in which any current Eligible Employee is a participant or to which any
current Eligible Employee is a party, if any, and all understandings between the Company and
such Eligible Employees with respect to the subject matter of this Plan.
	 
	8.	 	SUCCESSORS; BINDING AGREEMENT.
	 
	8.1	 	Successors of the Company. The Company shall require any successor (and its parent,
if applicable) who shall purchase all or substantially all of the business and/or assets of
the Company (whether direct or indirect, by purchase, merger, consolidation or otherwise) to
expressly assume and agree in writing to maintain this Plan in the same manner and to the same
extent that the Company would be required to maintain it; provided that no such
agreement shall be required if the successor (and its parent, if applicable) shall be or
remain so obligated by operation of law. As used in this Section 8.1, the “Company”
shall mean the Company as hereinbefore defined and any successor to its business and/or assets
as aforesaid which assumes and agrees to maintain this Plan or which otherwise becomes bound
by all the terms and provisions hereof by operation of law.
	 
	8.2	 	Eligible Employee’s Heirs, etc. This Plan shall inure to the benefit of and be
enforceable by each Eligible Employee’s personal or legal representatives, executors,
administrators, heirs, distributees, devisees and legatees. If an Eligible Employee should
die while any

- 13 -

 

	 	 	amounts or benefits would still be payable to the Eligible Employee hereunder as if the
Eligible Employee had continued to live, all such amounts and benefits, unless otherwise
provided herein, shall be paid or provided in accordance with the terms hereof to the
Eligible Employee’s designee or, if there be no such designee, to the Eligible Employee’s
estate. When a payment is due under this Plan to a severed Eligible Employee who is unable
to care for his affairs, payment may be made directly to the Eligible Employee’s legal
guardian or personal representative.

	8.3	 	Non-alienation. Except by will or intestacy as set forth in Section 8.2, no
right, benefit or interest of any Eligible Employee hereunder, shall be subject to
anticipation, alienation, sale, assignment, encumbrance, charge, pledge, hypothecation, or
set-off in respect of any claim, debt or obligation, or to execution, attachment, levy or
similar process, or assignment by operation of law. Any attempt, voluntary or involuntary, to
effect any action specified in the immediately preceding sentence shall, to the full extent
permitted by law, be null, void and of no effect.
	 
	9.	 	CONDITIONS TO PAYMENT, REIMBURSEMENT AND ACCELERATION.
	 
	9.1	 	General. Payments and benefits under this Plan are intended to comply with Section
409A to the extent subject thereto, and, accordingly, to the maximum extent permitted, this
Plan shall be interpreted and administered to be in compliance therewith.
	 
	9.2	 	Separation from Service. Notwithstanding anything contained herein to the contrary,
to the extent required in order to avoid accelerated taxation and/or tax penalties under
Section 409A, an Eligible Employee shall not be considered to have terminated employment with
the Employer for purposes of this Plan and no payments shall be due to the Eligible Employee
under this Plan until the Eligible Employee would be considered to have incurred a “separation
from service” from the Employer within the meaning of Section 409A.
	 
	9.3	 	Delay for Specified Employees. Notwithstanding any provisions of this Plan to the
contrary, if an Eligible Employee is a “specified employee” (within the meaning of Section
409A and determined pursuant to policies adopted by the Employer consistent with Section 409A)
at the time of the Eligible Employee’s separation from service and if any portion of the
payments or benefits to be received by the Eligible Employee upon separation from service
would be considered deferred compensation under Section 409A and cannot be paid or provided to
the Eligible Employee without his incurring taxes, interest or penalties under Section 409A,
amounts that would otherwise be payable pursuant to this Plan and benefits that would
otherwise be provided pursuant to this Plan, in each case, during the six-month period
immediately following the Eligible Employee’s separation from service will instead be paid or
made available on the earlier of (A) the date that is six months after the date of the
Eligible Employee’s separation from service and (B) the Eligible Employee’s death (the
applicable date, the “Permissible Payment Date”).
	 
	9.4	 	Reimbursements. With respect to any amount of expenses eligible for reimbursement
that is required to be included in an Eligible Employee’s gross income for federal income

- 14 -

 

	 	 	tax purposes, such expenses shall be reimbursed by the Employer within 60 days (or, if
applicable, on the Permissible Payment Date) following the date on which the Employer
receives the applicable invoice from the applicable Eligible Employee (and approves such
invoice) but in no event later than December 31st of the year following the year
in which the Eligible Employee incurs the related expenses. In no event shall the
reimbursements or in-kind benefits to be provided by the Employer in one taxable year affect
the amount of reimbursements or in-kind benefits to be provided in any other taxable year,
nor shall an Eligible Employee’s right to reimbursement or in-kind benefits be subject to
liquidation or exchange for another benefit.

	9.5	 	Separate Payments. Each payment under this Plan shall be considered a “separate
payment” and not one of a series of payments for purposes of Section 409A.
	 
	10.	 	CLAIMS, INQUIRIES, APPEALS.
	 
	10.1	 	Applications for Benefits and Inquiries. Any application for benefits, inquiries
about this Plan or inquiries about present or future rights under this Plan must be submitted
to the Plan Administrator in writing, as follows:

Vice President, Human Resources

(or General Counsel, if submitted by the Vice President, Human Resources)

c/o OM Group, Inc.

1500 Key Tower

127 Public Square

Cleveland, Ohio 44114

	10.2	 	Denial of Claims. In the event that any application for benefits is denied in whole
or in part, the Plan Administrator must notify the applicant, in writing, of the denial of the
application, and of the applicant’s right to review the denial. The written notice of denial
will be set forth in a manner designed to be understood by the employee, and will include
specific reasons for the denial, specific references to the Plan provision upon which the
denial is based, a description of any information or material that the Plan Administrator
needs to complete the review, and an explanation of this Plan’s review procedure.
	 
	 	 	This written notice will be given to the employee within 90 days after the Plan
Administrator receives the application, unless special circumstances require an extension of
time, in which case, the Plan Administrator has up to an additional 90 days for processing
the application. If an extension of time for processing is required, written notice of the
extension will be furnished to the applicant before the end of the initial 90-day period.
	 
	 	 	This notice of extension will describe the special circumstances necessitating the
additional time and the date by which the Plan Administrator is to render his decision on
the application. If written notice of denial of the application for benefits is not
furnished within the specified time, the application shall be deemed to be denied. The
applicant will then be permitted to appeal the denial in accordance with the review
procedure described below.

- 15 -

 

	10.3	 	Request for a Review. Any person (or that person’s authorized representative) for
whom an application for benefits is denied (or deemed denied), in whole or in part, may appeal
the denial by submitting a request for a review to the Plan Administrator within 60 days after
the application is denied (or deemed denied). The Plan Administrator will give the applicant
(or his representative) an opportunity to review pertinent documents in preparing a request
for a review and submit written comments, documents, records and other information relating to
the claim. A request for a review shall be in writing and shall be addressed to:

Vice President, Human Resources

(or General Counsel, if submitted by the Vice President, Human Resources)

c/o OM Group, Inc.

1500 Key Tower

127 Public Square

Cleveland, Ohio 44114

	 	 	A request for review must set forth all of the grounds on which it is based, all facts in
support of the request and any other matters that the applicant feels are pertinent. The
Plan Administrator may require the applicant to submit additional facts, documents or other
material as he may find necessary or appropriate in making his review.
	 
	10.4	 	Decision on Review. The Plan Administrator will act on each request for review
within 60 days after receipt of the request, unless special circumstances require an extension
of time (not to exceed an additional 60 days), for processing the request for a review. If an
extension for review is required, written notice of the extension will be furnished to the
applicant within the initial 60-day period. The Plan Administrator will give prompt, written
notice of his decision to the applicant. In the event that the Plan Administrator confirms
the denial of the application for benefits in whole or in part, the notice will outline, in a
manner calculated to be understood by the applicant, the specific Plan provisions upon which
the decision is based. If written notice of the Plan Administrator’s decision is not given to
the applicant within the time prescribed in this Section 10.4, the application will be
deemed denied on review.
	 
	10.5	 	Rules and Procedures. The Plan Administrator may establish rules and procedures,
consistent with this Plan and with ERISA, as necessary and appropriate in carrying out his
responsibilities in reviewing benefit claims. The Plan Administrator may require an applicant
who wishes to submit additional information in connection with an appeal from the denial (or
deemed denial) of benefits to do so at the applicant’s own expense.
	 
	10.6	 	Exhaustion of Remedies. No legal action for benefits under this Plan may be brought
until the claimant (A) has submitted a written application for benefits in accordance with the
procedures described by Section 10.1, (B) has been notified by the Plan Administrator
that the application is denied (or the application is deemed denied due to the Plan
Administrator’s failure to act on it within the established time period), (C) has filed a
written request for a review of the application in accordance with the appeal procedure
described in Section 10.3 and (D) has been notified in writing that the Plan
Administrator has denied the appeal (or the appeal is deemed to be denied due to the Plan

- 16 -

 

	 	 	Administrator’s failure to take any action on the claim within the time prescribed by
Section 10.4).

	11.	 	LEGAL FEES.
	 
	11.1	 	If any contest or dispute shall arise under or in connection with this Plan involving
termination of an Eligible Employee’s employment while this Plan is in effect or involving the
failure or refusal of the Employer or the Company to perform fully in accordance with the
terms of this Plan, and the Eligible Employee prevails in such contest or dispute with respect
to at least one material issue, then the Employer shall reimburse the Eligible Employee on a
current basis for all reasonable legal fees and related expenses, if any, incurred by the
Eligible Employee in connection with such contest or dispute, together with interest at a rate
equal to the prime rate as reported in The Wall Street Journal on the day of the
reimbursement, such interest to accrue 30 days from the date the Employer receives the
Eligible Employee’s statement for such fees and expenses through the date of payment thereof.

- 17 -

 

EXHIBIT A

WAIVER AND RELEASE OF CLAIMS Agreement

     ___________________ (“Employee”) and ________________ (“Employer”) hereby
acknowledge that Employee is being offered certain payments and benefits as part of the OM Group,
Inc. Executive Severance Plan (the “Plan”), and enter into this Waiver and Release of
Claims Agreement (this “Agreement”) pursuant to the following terms and conditions:

Severance Benefits

     1. In exchange for Employee’s promises in this Agreement, Employer agrees to tender to
Employee the severance amounts and benefits set forth in Section 2 of the Plan (the
“Severance Benefits”).

     2. Employee agrees that Employee will be entitled to receive the Severance Benefits only if
Employee accepts and does not revoke this Agreement, which requires Employee to release both known
and unknown claims.

     3. Employee agrees that the Severance Benefits tendered under the Plan constitute fair and
adequate consideration for the execution of this Agreement. Employee further agrees that Employee
has been fully compensated for all wages and fringe benefits, including, but not limited to, paid
and unpaid leave, due and owing, and that the Severance Benefits are in addition to payments and
benefits to which Employee is otherwise entitled.

Claims That Are Being Released

     4. Employee agrees that this Agreement constitutes a full and final release by Employee and
Employee’s descendants, dependents, heirs, executors, administrators, assigns, and successors, of
any and all claims, charges, and complaints, whether known or unknown, that Employee has or may
have to date against Employer and any of its parents, subsidiaries, or affiliated entities and
their respective officers, directors, shareholders, partners, joint venturers, employees,
consultants, insurers, agents, predecessors, successors, and assigns, arising out of or related to
Employee’s employment or the termination thereof, or otherwise based upon acts or events that
occurred on or before the date on which Employee signs this Agreement. To the fullest extent
allowed by law, Employee hereby waives and releases any and all such claims, charges, and
complaints in return for the Severance Benefits. This release of claims is intended to be as broad
as the law allows, and includes, but is not limited to, rights arising out of alleged violations of
any contracts, express or implied, any covenant of good faith or fair dealing, express or implied,
any tort or common law claims, any legal restrictions on Employer’s right to terminate employees,
and any claims under any federal, state, municipal, local, or other governmental statute,
regulation, or ordinance, including, without limitation:

	 	(a)	 	claims of discrimination, harassment, or retaliation under equal employment
laws such as Title VII of the Civil Rights Act of 1964, the Americans with Disabilities
Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection

- 18 -

 

	 	 	 	Act, the Rehabilitation Act of 1973, and the Equal Pay Act, and any and all other
federal, state, municipal, or local equal opportunity laws;

	 	(b)	 	claims of wrongful termination of employment; statutory, regulatory, and common
law “whistleblower” claims; claims for wrongful termination in violation of public
policy; or any other cause of action arising under or based on the common law of Ohio
or the public policy of the State of Ohio, including, but not limited to, intentional
infliction of emotional distress;
	 
	 	(c)	 	claims arising under the Employee Retirement Income Security Act of 1974,
except for any claims relating to vested benefits under Employer’s employee benefit
plans;
	 
	 	(d)	 	claims of violation of wage and hour laws, including, but not limited to,
claims for overtime pay, meal and rest period violations, and recordkeeping violations;
and
	 
	 	(e)	 	claims of violation of federal, state, municipal, or local laws concerning
leaves of absence, such as the Family and Medical Leave Act.

     5. If Employee has worked or is working in California, Employee expressly agrees to waive the
protection of Section 1542 of the California Civil Code, which provides:

	 	 	A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR

Claims That Are Not Being Released

     6. This release does not include any claims that may not be released as a matter of law, and
this release does not waive claims or rights that arise after Employee signs this Agreement.
Further, this release will not prevent Employee from doing any of the following:

	 	(a)	 	obtaining unemployment compensation, state disability insurance, or workers’
compensation benefits from the appropriate agency of the state in which Employee lives
and works, provided Employee satisfies the legal requirements for such benefits
(nothing in this Agreement, however, guarantees or otherwise constitutes a
representation of any kind that Employee is entitled to such benefits);
	 
	 	(b)	 	asserting any right that is created or preserved by this Agreement, such as
Employee’s right to receive the Severance Benefits or any vested deferred compensation
under Employer’s deferred compensation program;
	 
	 	(c)	 	filing a charge, giving testimony or participating in any investigation
conducted by the Equal Employment Opportunity Commission (the “EEOC”) or any
duly authorized agency of the United States or any state (however, Employee is hereby
waiving the right to any personal monetary recovery or other personal relief should the
EEOC (or any similarly authorized agency) pursue any class or individual charges in
part or entirely on Employee’s behalf); or

- 19 -

 

	 	(d)	 	challenging or seeking determination in good faith of the validity of this
waiver under the Age Discrimination in Employment Act (nor does this release impose any
condition precedent, penalties, or costs for doing so, unless specifically authorized
by federal law).

Additional Employee Covenants

     7. To the extent applicable, Employee confirms and agrees to Employee’s continuing obligations
under Section 5 of the Plan (entitled Confidentiality, Non-Solicitation and
Non-Competition) following termination of Employee’s employment with Employer.

Voluntary Agreement And Effective Date

     8. Employee understands and acknowledges that by signing this Agreement, Employee is agreeing
to all of the provisions stated in this Agreement, and has read and understood each provision.

     9. The parties understand and agree that:

	 	(a)	 	Employee will have a period of 45 calendar days in which to decide whether or
not to sign this Agreement, and an additional period of seven calendar days after
signing in which to revoke this Agreement. If Employee signs this Agreement before the
end of such 45-day period, Employee certifies and agrees that the decision is knowing
and voluntary and is not induced by Employer through (i) fraud, misrepresentation, or a
threat to withdraw or alter the offer before the end of such 45-day period or (ii) an
offer to provide different terms in exchange for signing this Agreement before the end
of such 45-day period.
	 
	 	(b)	 	In order to exercise this revocation right, Employee must deliver written
notice of revocation to ________________ on or before the seventh calendar day after
Employee executes this Agreement. Employee understands that, upon delivery of such
notice, this Agreement shall terminate and become null and void.
	 
	 	(c)	 	The terms of this Agreement will not take effect or become binding, and
Employee will not become entitled to receive the Severance Benefits, until that
seven-day period has lapsed without revocation by Employee. If Employee elects not to
sign this Agreement or revokes it within seven calendar days of signing, Employee will
not receive the Severance Benefits.
	 
	 	(d)	 	All amounts payable hereunder shall be paid in accordance with the applicable
terms of the Plan.

Governing Law

     10. This Agreement shall be governed by the substantive laws of the State of Ohio, without
regard to conflicts of law, and by federal law where applicable.

- 20 -

 

     11. If any part of this Agreement is held to be invalid or unenforceable, the remaining
provisions of this Agreement will not be affected in any way.

Consultation With Attorney

     12. Employee is hereby encouraged and advised to confer with an attorney regarding this
Agreement. By signing this Agreement, Employee acknowledges that Employee has consulted, or had
an opportunity to consult with, an attorney or a representative of Employee’s choosing, if any, and
that Employee is not relying on any advice from Employer or its agents or attorneys in executing
this Agreement.

     13. This Agreement was provided to Employee for consideration on ____________.

PLEASE READ THIS AGREEMENT CAREFULLY; IT CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

[Remainder of page intentionally left blank]

- 21 -

 

Employee certifies that Employee has read this Agreement and fully and completely understands and
comprehends its meaning, purpose, and effect. Employee further states and confirms that Employee
has signed this Agreement knowingly and voluntarily and of Employee’s own free will, and not as a
result of any threat, intimidation or coercion on the part of Employer or its representatives or
agents.

	 	 	 	 	 	 	 

	 	 	EMPLOYEE	 	 
	Date:                                        
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	EMPLOYER	 	 	 	 
	 
	 	 	 	 	 	 
	Date:                                        

	 	BY:

ITS:
	 	 
 

	 	 

STATE OF __________,

COUNTY OF __________, To Wit:

I, ______________________, a notary public in and for the County and State aforesaid, do hereby
certify that ____________________, whose name is affixed to the foregoing writing bearing date the
_______day of _________, 20__, has this day acknowledged the same before me in my said County and
State.

Given under my hand this _____day of __________, 20_.

______________________

                                                                 

               NOTARY PUBLIC

- 22 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}]]