Document:

Exhibit
10.8

 

ALLIANT TECHSYSTEMS INC.

 

INCOME SECURITY PLAN

 

As Amended and Restated

Effective October 29, 2007

 

 

CONTENTS

 

	
  SECTION 1.

  	
  PURPOSE AND TERM

  	
  1

  
	
  1.1

  	
  Purpose

  	
  1

  
	
  1.2

  	
  Type of Plan

  	
  1

  
	
  1.3

  	
  Term; Effect of Change in Control

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
  DEFINITIONS

  	
  2

  
	
  2.1

  	
  Definitions

  	
  2

  
	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
  UNPAID COMPENSATION AND
  SEVERANCE BENEFITS

  	
  7

  
	
  3.1

  	
  Right to Unpaid Compensation and
  Severance Benefits

  	
  7

  
	
  3.2

  	
  Severance Benefits for Tier 1
  Participants and Tier 2 Participants

  	
  8

  
	
  3.3

  	
  Severance Benefits for Tier 1
  Participants

  	
  9

  
	
  3.4

  	
  Severance Benefits for Tier 2
  Participants

  	
  10

  
	
  3.5

  	
  Termination Due to Disability or
  Death

  	
  11

  
	
  3.6

  	
  Termination for Cause or by the
  Participant Without Good Reason

  	
  11

  
	
  3.7

  	
  Notice of Termination

  	
  11

  
	
  3.8

  	
  Payment of Severance Benefits

  	
  11

  
	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
  RELEASE AND RESTRICTIVE
  COVENANTS

  	
  11

  
	
  4.1

  	
  Release

  	
  11

  
	
  4.2

  	
  Restrictive Covenants

  	
  11

  
	
  4.3

  	
  Services of Participant

  	
  11

  
	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
  TRUST

  	
  12

  
	
  5.1

  	
  Establishment of Trust

  	
  12

  
	
  5.2

  	
  Trust Assets

  	
  12

  
	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
  EXCISE TAXES

  	
  12

  
	
  6.1

  	
  Gross-Up Payment

  	
  12

  
	
  6.2

  	
  Payment Date

  	
  13

  
	
  6.3

  	
  Controversies with Taxing
  Authorities

  	
  13

  
	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
  CLAIMS PROCEDURE

  	
  14

  
	
  7.1

  	
  Original Claim

  	
  14

  
	
  7.2

  	
  General Rules

  	
  14

  
	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
  RIGHTS TO SEVERANCE
  BENEFITS AND LEGAL FEES

  	
  15

  
	
  8.1

  	
  Severance Benefits Payments

  	
  15

  
	
  8.2

  	
  Legal Fees and Expenses

  	
  15

  
	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
  SUCCESSORS

  	
  15

  
	
  9.1

  	
  Successors to the Company

  	
  15

  
	
  9.2

  	
  Assignment by the Participant

  	
  16

  

 

i

 

	
  SECTION 10.

  	
  MISCELLANEOUS

  	
  16

  
	
  10.1

  	
  Administration and Committee Powers

  	
  16

  
	
  10.2

  	
  Employment Status

  	
  16

  
	
  10.3

  	
  Entire Plan and Other Change in
  Control Plans

  	
  16

  
	
  10.4

  	
  Notices

  	
  16

  
	
  10.5

  	
  Includable Compensation

  	
  16

  
	
  10.6

  	
  Tax Withholding

  	
  17

  
	
  10.7

  	
  Severability

  	
  17

  
	
  10.8

  	
  Amendment and Waiver

  	
  17

  
	
  10.9

  	
  Applicable Law

  	
  17

  
	
  10.10

  	
  Rules of Construction

  	
  17

  

 

ii

 

ALLIANT TECHSYSTEMS INC.

 

INCOME SECURITY PLAN

 

As Amended and Restated Effective
October 29, 2007

 

SECTION 1.                                PURPOSE AND TERM

 

1.1                                 Purpose.
 The purpose of this Income Security Plan
(this “Plan”) is to provide income security protection to certain executives of
Alliant Techsystems Inc. (the “Company”) in order to (a) ensure that such
executives make good corporate decisions with respect to a possible Change in
Control (as defined in Section 2.1) of the Company, even if such a Change
in Control may have adverse personal consequences (such as the loss of the
executive’s employment with the Company), (b) maximize stockholder value
by keeping such executives engaged during periods of uncertainty relating to a
possible Change in Control, and (c) provide such executives with the
ability to transition to new employment if their employment with the Company is
terminated as a result of a Change in Control.

 

1.2                                 Type
of Plan.  This Plan is a severance
pay plan maintained primarily for the benefit of a select group of management
or highly compensated individuals within the meaning of ERISA (as defined in
Section 2.1). This Plan will be administered and interpreted (i) in a
manner consistent with such intent and (ii) in accordance with Section
409A of the Code (as defined in Section 2.1) and other applicable Tax (as
defined in Section 2.1) laws and regulations, including, without limitation,
any regulations promulgated pursuant to Section 409A of the Code. Notwithstanding
the foregoing, neither the Company nor any of its officers, directors, agents
or affiliates will be obligated, directly or indirectly, to any Participant for
any Taxes that may be imposed on such Participant (a) on account of any
amounts due or paid under this Plan (except as otherwise expressly provided in
Section 6) or (b) on account of any failure to comply with any
provision of the Code.

 

1.3                                 Term;
Effect of Change in Control»

 

(a)                                  This
Plan is effective on March 13, 2006 (the “Effective Date”) and will
continue in effect until this Plan is terminated by the Committee (as defined
in Section 2.1). The Committee may terminate this Plan at any time. If a notice
terminating this Plan is properly delivered by the Committee, this Plan, along
with all corresponding rights, duties and covenants, will immediately
terminate; provided, however, that in the event a Change in
Control occurs within 12 months after receipt of such notice, such termination
of the Plan will be deemed null and void, and the participation of the
Participants in this Plan will not be affected by such notice (unless such
termination of this Plan or participation by any Participant herein is required
by the terms of any final order or a federal or state court or regulatory
agency of competent jurisdiction).

 

(b)                                 Notwithstanding
Section 1.3(a), in the event that a Change in Control occurs during the
term of the Plan, the Committee may not terminate the Plan during the 

 

1

 

period beginning on the date of such Change in Control
through the third anniversary date of the Change in Control. This Plan will
thereafter automatically terminate.

 

SECTION 2.                                DEFINITIONS

 

2.1                                 Definitions.
 The following capitalized terms used in
this Agreement will have the meanings set forth below:

 

(a)                                  “Annual
Base Salary” means, at any time, the then regular annual rate of cash
compensation that a Participant is receiving as annual salary, excluding all
other kinds of compensation.

 

(b)                                 “Annual
Incentive Plan” means any incentive compensation plan of the Company with a
performance period of one year or less (other than an Equity Incentive Plan) in
which a Participant participates on the date of any Qualifying Termination of
such Participant, unless the Committee otherwise determines that such plan is a
Long-Term Cash Incentive Plan.

 

(c)                                  “Beneficial
Owner” or “Beneficial Ownership” will have the meaning given to such
term in Rule 13d-3 under the Exchange Act.

 

(d)                                 “Board”
or “Board of Directors” means the Board of Directors of the Company.

 

(e)                                  “Cause”
means the occurrence of any of the following:

 

(i)                                     the
Participant willfully and continually fails to substantially perform his or her
duties of employment (other than because of a mental or physical impairment)
for a period of at least 30 days after being given notice of such failure;

 

(ii)                                  the
Participant (A) engages in any act of dishonesty, wrongdoing or moral
turpitude (whether or not a felony) or (B) violates the Company’s Code of
Conduct or a Company policy, which violation has an adverse effect upon the
Company; or

 

(iii)                               the
Participant breaches his or her duty of loyalty or commits an unauthorized
disclosure of proprietary or confidential information of the Company.

 

(f)                                    “Change
in Control” means the occurrence of any of the following:

 

(i)                                     The
acquisition by any Person of Beneficial Ownership of 40% or more of the
outstanding shares of the Company’s Voting Securities;

 

(ii)                                  The
consummation of a reorganization, merger or consolidation of the Company or
sale or other disposition of all or substantially all of the assets of the
Company (a “Corporate Transaction”), unless such Corporate Transaction is a 

 

2

 

transaction pursuant to which all or substantially all
of the Persons who are the Beneficial Owners of the Company immediately prior
to the Corporate Transaction will beneficially own, directly or indirectly, 60%
or more of the outstanding shares of Voting Securities of the resulting or
combined entity;

 

(iii)                               Individuals
who, as of the Effective Date, constitute the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the Board; provided,
however, that (A) any individual who becomes a member of the Board
subsequent to the Effective Date, whose election (or nomination for election by
the Company’s stockholders) was approved by the vote of at least a majority of
the Directors then comprising the Incumbent Board will be deemed a member of
the Incumbent Board and (B) any individual who is initially elected as a
member of the Board as a result of any actual or threatened solicitation of
proxies or consents by or on behalf of any Person other than the Board will not
be deemed a member of the Incumbent Board;

 

(iv)                              Approval
by the stockholders of the Company of a complete liquidation or dissolution of
the Company; or

 

(v)                                 Any
other circumstances (whether or not following a Change Event) which the Board
determines to be a Change in Control for purposes of this Plan after giving due
consideration to the nature of the circumstances then presented and the
purposes of this Plan. Any such determination made by the Board will be
irrevocable except by vote of a majority of the members of the Board who voted
in favor of making such determination.

 

For purposes of this Section 2.1(f), a “Change in
Control” will not result from any transaction precipitated by the Company’s
insolvency, appointment of a conservator or determination by a regulatory
agency that the Company is insolvent.

 

(g)                                 “Change
Event” means either of the following:

 

(i)                                     The
acquisition by any Person (other than the Company or a subsidiary or an
employee benefit plan (including its trustee) of the Company) of Beneficial
Ownership, directly or indirectly, of shares of Voting Securities of the
Company directly or indirectly representing 15% or more of the total number of
the then outstanding shares of the Company’s Voting Securities (excluding the
sale or issuance of any Voting Securities directly by the Company, or any
transaction in which the acquisition of such Voting Securities is made by such
Person from five or fewer stockholders in a transaction or transactions
approved in advance by the Board); or

 

(ii)                                  The
public announcement by any Person of an intention to acquire the Company through
a tender offer, exchange offer or other unsolicited proposal.

 

(h)                                 “Code”
means the U.S. Internal Revenue Code of 1986, as amended from time to time.

 

3

 

(i)                                     “Committee”
means the Personnel and Compensation Committee of the Board, or, if no
Personnel and Compensation Committee exists, then a committee of independent
Board members appointed by the Board to administer this Plan.

 

(j)                                     “Common
Stock” means the common stock, par value $.01 per share, of the Company.

 

(k)                                  “Disability”
or “Disabled” will have the meaning given to such term in the Company’s
governing long-term disability plan or, if no such plan exists, such term will
mean total and permanent disability as determined under the rules of the Social
Security Administration.

 

(l)                                     “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.

 

(m)                               “Equity
Incentive Plan” means any incentive compensation plan of the Company
providing for the grant of Stock Awards in which a Participant participates on
the date of any Qualifying Termination of such Participant.

 

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

 

(o)                                 “Group
Health Plan” means any group health plan generally available to all
employees of the Company in which a Participant participates on the date of any
Qualifying Termination of such Participant.

 

(p)                                 “Good
Reason” means, without a Participant’s express written consent, the
occurrence after a Change Event or a Change in Control, as the case may be, of
any one or more of the following:

 

(i)                                     A
material reduction of such Participant’s authorities, duties or
responsibilities as an executive and/or officer of the Company from those in
effect immediately prior to such Change Event or Change in Control, other than
(A) an insubstantial reduction or (B) a substantial reduction that is
remedied by the Company within 30 days after receipt of notice thereof given by
the Participant within 90 days after such circumstances first arise;

 

(ii)                                  The
Company’s requiring the Participant to be based at a location in excess of 50
miles from the Participant’s principal job location immediately prior to such
Change Event or Change in Control, unless such requirement is withdrawn by the
Company within 30 days after notice thereof given by the Participant within 90
days after such circumstances first arise;

 

(iii)                               A
material reduction by the Company of the Participant’s Annual Base Salary in
effect immediately prior to such Change Event or Change in Control, or as such
Annual Base Salary has been increased thereafter, unless such reduction is
remedied by the Company within 30 days after notice thereof given by the
Participant within 90 days after such circumstances first arise;

 

4

 

(iv)                              The
failure of the Company to continue in effect, or the failure to continue the
Participant’s participation on substantially the same basis in, any Annual
Incentive Plan, Long-Term Cash Incentive Plan or Equity Compensation Plan in
which the Participant participates immediately prior to such Change Event or
Change in Control, where the result is a material reduction in the Participant’s
total compensation, unless such failure is remedied by the Company within 30
days after notice thereof given by the Participant within 90 days after such
circumstances first arise ; and

 

(v)                                 If
such Change in Control results in a successor to the Company, the failure of
the Company to obtain a satisfactory agreement from such successor to assume
and agree to perform the Company’s obligations under this Plan, as contemplated
by Section 9.1, unless such failure is remedied within 30 days after
notice thereof given by the Participant within 90 days after such circumstances
first arise.

 

Unless the Participant becomes Disabled, the
Participant’s right to terminate employment for Good Reason will not be
affected by the Participant’s incapacity due to physical or mental illness. The
Participant’s continued employment will not constitute consent to, or a waiver
of rights with respect to, any action or circumstance constituting Good Reason.

 

(q)                                 “Long-Term
Cash Incentive Plan” means (i) any cash incentive compensation plan of
the Company with a performance period of more than one year (other than an
Equity Incentive Plan) or (ii) or any other cash incentive compensation
plan the Committee determines is a Long-Term Cash Incentive Plan (other than an
Equity Incentive Plan), in each case in which a Participant participates on the
date of any Qualifying Termination of such Participant.

 

(r)                                    “Notice
of Termination” means a written notice indicating the specific provision in
this Plan relied upon for the termination of employment of any Participant. Such
notice will set forth in reasonable detail the facts and circumstances claimed
to provide the basis for such termination pursuant to such provision.

 

(s)                                  “Participant”
means any of the Tier 1 Participants or Tier 2 Participants.

 

(t)                                    “Performance
Vesting Stock Award” means any Stock Award the vesting and payment of which
is based on achievement of performance goals rather than solely on the
continued employment of a Participant.

 

(u)                                 “Perquisites”
means any automobile allowance, financial planning services, employment
outplacement services or other perquisites provided to a Participant under any
benefit plan or program of the Company that provides special benefits to a
select group of management or highly compensated employees in which such
Participant participates on the date of any Qualifying Termination of such
Participant.

 

(v)                                 “Person”
will have the meaning given to such term in Section 3(a)(9) of the
Exchange Act and used in Sections 13(d) and 14(d) thereof (including a “group”
as defined in Section 13(d)).

 

5

 

(w)                               “Qualified
401(k) Plan” means any Retirement Plan of the Company with a voluntary
elective deferral arrangement intended to be qualified under Sections 401(a)
and 401(k) of the Code in which a Participant participates on the date of any
Qualifying Termination of such Participant.

 

(x)                                   “Qualifying
Termination” means a Post-Change in Control Qualifying Termination (as
defined in Section 3.1(a)) or a Pre-Change in Control Qualifying Termination
(as defined in Section 3.1(b)), as the case may be; provided, however
that a Qualifying Termination will not occur unless the Participant’s
termination of employment qualifies as a “separation from service” (within the
meaning of Section 409A of the Code).

 

(y)                                 “Retirement
Plan” means any “employee pension benefit plan” (within the meaning of
Section 3(2) of ERISA) of the Company, including, without limitation, any
Qualified 401(k) Plan and any SERP.

 

(z)                                   “SERP”
means (i) the Company’s Supplemental Executive Retirement Plan, or
(ii) any other non-qualified supplemental retirement plan or agreement
pursuant to which any Participant is entitled to receive supplemental
retirement benefits on the date of any Qualifying Termination of such
Participant.

 

(aa)                            “Severance
Benefits” mean the severance benefits provided for in Section 3.2, 3.3
and 3.4.

 

(bb)                          “Stock
Award” means any equity-based incentive award (including any award, without
limitation, of stock options, stock appreciation rights, restricted stock or
restricted stock units, or any Performance Vesting Stock Awards).

 

(cc)                            “Target
Level” means the “target” performance level (or other reasonably expected
median performance goal) established for purposes of any Annual Incentive Plan,
Long-Term Cash Incentive Plan or Performance Vesting Stock Award.

 

(dd)                          “Tax”
or “Taxes” means all taxes, charges, fees, levies or other assessments
and impositions of any kind, payable to any governmental entity, including,
without limitation, all net income, profits, gross income, alternative minimum,
payroll, employment, social security, Medicare, unemployment, withholding,
disability, workers’ compensation, excise, or other taxes or fees, assessments
or charges of any kind whatsoever, including, without limitation, all interest
and penalties thereon, and additions to tax or additional amounts imposed by
any taxing authority.

 

(ee)                            “Tier 1
Participant” means each of the Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer and General Counsel of the Company.

 

(ff)                                “Tier 2 Participant” means (i) any
executive officer of the Company (other than a Tier 1 Participant) required to
file reports of beneficial ownership with the Securities and Exchange
Commission pursuant to Section 16(a) of the Exchange Act and the rules and
regulations promulgated thereunder and (ii) any employee selected by the
Committee as a covered employee eligible under this Plan (employees selected by
the 

 

6

 

Committee will be referred
to as “Selected Tier 2 Participants”). The Committee will select Selected Tier
2 Participants annually at the meeting in which it sets executive compensation
for the next fiscal year. Selected Tier 2 Participants will remain eligible as
a Participant under this Plan for the fiscal year for which the Committee
approved eligibility. During the fiscal year, the Committee may change the
status of a Selected Tier 2 Participant if he or she has a change in employment
status (examples:  removal from
eligibility because of a demotion or added as eligible because of a promotion).
Notwithstanding the foregoing, a Selected Tier 2 Participant may not lose
covered employee status as a Selected Tier 2 Participant by the Committee if he
or she was a Participant and was eligible for benefits under Section 3.1,
Rights to Unpaid Compensation and Severance Benefits, for a Change in Control
occurrence.

 

(gg)                          “Unpaid
Compensation” means any of the following:

 

(i)                                     Any
unpaid Annual Base Salary, accrued vacation pay and unreimbursed business
expenses owed to any Participant through the date of the Qualifying Termination
of such Participant;

 

(ii)                                  Any
amount payable to such Participant as of the date of such Participant’s
Qualifying Termination under any Annual Incentive Plan in effect for the most
recently completed fiscal year, to the extent not previously paid; and

 

(iii)                               Any
amount payable to such Participant as of the date of such Participant’s
Qualifying Termination under any Long-Term Cash Incentive Plan in effect for
any completed performance period, to the extent not previously paid.

 

(hh)                          “Voting
Securities” means any shares of capital stock of any entity that are
generally entitled to vote in elections for members of the board of directors.

 

SECTION 3.                                UNPAID COMPENSATION AND SEVERANCE BENEFITS

 

3.1                                 Right
to Unpaid Compensation and Severance Benefits.

 

(a)                                  Subject
to the terms and conditions of this Plan, a Participant will be entitled to
receive from the Company any Unpaid Compensation and the Severance Benefits
described in Sections 3.2, 3.3 and 3.4 (as applicable) if (i) during
the term of this Plan, a Change in Control occurs and (ii) within 36
months thereafter, the Participant’s employment with the Company is terminated
by the Company without Cause or voluntarily by the Participant for Good Reason,
in the latter case within two years after the circumstances comprising Good
Reason first arise. The termination of a Participant’s employment that entitles
the Participant to Severance Benefits pursuant to this Section 3.1(a) is
referred to in this Plan as a “Post-Change in Control Qualifying Termination.”  A “Post-Change in Control Qualifying
Termination” will not include a termination of a Participant’s employment by
reason of death or Disability, the Company’s termination of a Participant’s
employment for Cause or a Participant’s voluntary termination without Good
Reason.

 

7

 

(b)                                 Subject
to the terms and conditions of this Plan, a Participant will also be entitled
to receive from the Company any Unpaid Compensation and the Severance Benefits
described in Sections 3.2, 3.3 and 3.4 (as applicable) if (i) during the
term of this Plan, a Change Event and a Change in Control occur and
(ii) within 12 months after such Change Event and no more than 12 months
prior to such Change in Control, such Participant’s employment with the Company
is terminated by the Company without Cause or voluntarily by the Participant
for Good Reason, in the latter case within two years after the circumstances
comprising Good Reason first arise; provided, however, that the
Participant will only be entitled to receive such Severance Benefits if the
Participant can demonstrate that such termination by the Company or event
constituting Good Reason (A) occurred at the specific request of a third
party with which the Company had entered into negotiations or an agreement
regarding a subsequent Change in Control or (B) otherwise occurred in
connection with (or in anticipation of) such Change in Control. The termination
of a Participant’s employment that entitles the Participant to Severance
Benefits pursuant to this Section 3.1(b) is referred to in this Plan as a “Pre-Change
in Control Qualifying Termination.”  A “Pre-Change
in Control Qualifying Termination” will not include a termination of a
Participant’s employment by reason of death or Disability, the Company’s
termination of a Participant’s employment for Cause or a Participant’s
voluntary termination without Good Reason.

 

(c)                                  Any
Unpaid Compensation will be paid in cash to a Participant in a single lump sum
within 30 days after the date of the Qualifying Termination of such
Participant.

 

3.2                                 Severance
Benefits for Tier 1 Participants and Tier 2 Participants.  In the event the Company is obligated to
provide Severance Benefits to any Participant pursuant to Section 3.1,
such Participant will receive the following with payment as provided in this
Section 3 unless the Participant has validly and effectively elected deferral
of any such payment or award under another plan (in which case the payment or
award would be made under the terms of the other plan):

 

(a)                                  The
cash amount such Participant would receive under the Annual Incentive Plan in
effect for the fiscal year in which such Participant’s Qualifying Termination
occurs. If such Qualifying Termination occurs within the first three quarters
of any fiscal year, such cash amount will be determined based on the assumption
that the Target Level of performance under such Annual Incentive Plan had been
achieved. If the Qualifying Termination occurs in the fourth quarter of any
fiscal year, such cash amount will be determined based on projected actual
performance (unless Target Level performance would result in a larger cash
payment, in which event the amount of the cash payment will be determined based
on the assumption that Target Level performance had been achieved). In each
case, the cash amount will be adjusted on a pro rata basis to reflect the
number of days the Participant was actually employed during such fiscal year.

 

(b)                                 The
cash amount such Participant would receive under any Long-Term Cash Incentive
Plan in effect at the time such Participant’s Qualifying Termination occurs,
assuming the Target Level of performance under such Long-Term Cash Incentive
Plan had been achieved.

 

8

 

(c)                                  Any
Stock Awards of the Participant (other than Performance Vesting Stock Awards)
will become immediately vested and payable in full in the form of stock on the
date of a Qualifying Termination of the Participant and will be paid,
distributed or transferred to the Participant in accordance with their terms.

 

(d)                                 Any
Performance Vesting Stock Awards of the Participant will become immediately
vested and payable in the form of stock on the date of a Qualifying Termination
of such Participant, assuming the Target Level of performance under such
Performance Vesting Stock Award had been achieved and will be paid, distributed
or transferred to the Participant in accordance with their terms.

 

(e)                                  A
cash amount, determined in the sole discretion of the Committee, with a value
equal to any Perquisites that would have been provided to the Participant for a
period of one year following the Qualifying Termination of such Participant.

 

3.3                                 Severance
Benefits for Tier 1 Participants.  In the event the Company is obligated to
provide Severance Benefits to any Tier 1 Participant pursuant to
Section 3.1, such Tier 1 Participant will receive (in addition to the
Severance Benefits described in Section 3.2) the following:

 

(a)                                  A
cash amount equal to the sum of: 
(i) three times the Tier 1 Participant’s Annual Base Salary in
effect on the date of his or her Qualifying Termination, plus (ii) three
times the Tier 1 Participant’s then current bonus opportunity established
under any Annual Incentive Plan, assuming the Target Level of performance under
such Annual Incentive Plan had been achieved.

 

(b)                                 A
cash amount equal to three times the maximum match (determined on an annual
basis) the Tier 1 Participant would have received under any Qualified
401(k) Plan for the calendar year in which such Tier 1 Participant’s
Qualifying Termination occurs, assuming such Tier 1 Participant had
(i) earned “recognized compensation” during such calendar year equal to or
greater than the maximum dollar amount permitted under the Code and
(ii) deferred into the Qualified 401(k) Plan such maximum dollar amount
for the calendar year.

 

(c)                                  A
cash amount, determined in the sole discretion of the Committee, with a value
equal to the benefits that would have been provided to the Participant for a
period of three years after the date of such Participant’s Qualifying
Termination under the Group Health Plan.

 

(d)                                 An
additional supplemental retirement benefit equal to the increase to the
Tier 1 Participant’s benefit under any SERP that would have occurred if
the amount of such Tier 1 Participant’s benefit payable under the SERP was
determined based on the assumption that the Tier 1 Participant had been
continuously employed by the Company for the three-year period following the
date of such Tier 1 Participant’s Qualifying Termination (with respect to
both the Tier 1 Participant’s age and years of service); provided, however,
that neither the time nor the form of payment of such Tier 1 Participant’s
benefit under the SERP will be affected by such additional age and service 

 

9

 

credit, and such supplemental retirement benefit will
be paid at the time and in the form the benefit under the SERP is paid. In
determining the amount of such additional supplemental retirement benefit, a
Tier 1 Participant’s “recognized compensation” will be deemed to include
his or her Annual Base Salary and any payments received by the Tier 1
Participant pursuant to any Annual Incentive Plan during the year preceding his
or her Qualifying Termination.

 

3.4                                 Severance
Benefits for Tier 2 Participants.  In the event the Company is obligated to
provide Severance Benefits to any Tier 2 Participant pursuant to
Section 3.1, such Tier 2 Participant will receive (in addition to the
Severance Benefits described in Section 3.2) the following:

 

(a)                                  A
cash amount equal to the sum of: 
(i) two times the Tier 2 Participant’s Annual Base Salary in
effect on the date of his or her Qualifying Termination, plus (ii) two
times the Tier 2 Participant’s then current bonus opportunity established
under any Annual Incentive Plan, assuming the Target Level of performance under
such Annual Incentive Plan had been achieved.

 

(b)                                 A
cash amount equal to two times the maximum match (determined on an annual
basis) the Tier 2 Participant could have received under any Qualified
401(k) Plan for the calendar year in which such Tier 2 Participant’s
Qualifying Termination occurs, assuming such Tier 2 Participant had
(i) earned “recognized compensation” during such calendar year equal to or
greater than the maximum dollar amount permitted under the Code and
(ii) deferred into the Qualified 401(k) Plan such maximum dollar amount
for the calendar year.

 

(c)                                  A
cash amount, determined in the sole discretion of the Committee, with a value
equal to the benefits that would have been provided to the Participant for a
period of two years after the date of such Participant’s Qualifying Termination
under the Group Health Plan.

 

(d)                                 An
additional supplemental retirement benefit equal to the increase to the
Tier 2 Participant’s benefit under any SERP that would have occurred if
the amount of such Tier 2 Participant’s benefit payable under the SERP was
determined based on the assumption that the Tier 2 Participant had been
continuously employed by the Company for the two-year period following the date
of such Tier 2 Participant’s Qualifying Termination (with respect to both
the Tier 2 Participant’s age and years of service); provided, however,
that neither the time nor the form of payment of such Tier 2 Participant’s
benefit under the SERP will be affected by such additional age and service
credit, and such supplemental retirement benefit will be paid at the time and
in the form the benefit under the SERP is paid. In determining the amount of
such additional supplemental retirement benefit, a Tier 2 Participant’s “recognized
compensation” will be deemed to include his or her Annual Base Salary and any
payments received by the Tier 2 Participant pursuant to any Annual
Incentive Plan during the year preceding his or her Qualifying Termination.

 

10

 

3.5                                 Termination
Due to Disability or Death.  Following
a Change in Control, if a Participant’s employment with the Company is
terminated due to Disability or death, the Company will pay any Unpaid
Compensation through the date of such termination to the Participant or his or
her designated beneficiaries (or, if there are no such designated
beneficiaries, to the Participant’s estate), respectively. The payment of any
other amounts or benefits to the Participant or his or her beneficiaries or
estate will be determined in accordance with any Annual Incentive Plan,
Long-Term Cash Incentive Plan, Equity Incentive Plan, the Company’s retirement,
disability, insurance and survivors’ benefits plans and programs and other
applicable plans and programs of the Company then in effect.

 

3.6                                 Termination
for Cause or by the Participant Without Good Reason.  Following a Change in Control, if a
Participant’s employment with the Company is terminated either by the Company
for Cause or voluntarily by such Participant without Good Reason, the Company
will pay the Participant (a) any Unpaid Compensation through the date of
such termination, plus (b) all other amounts to which the Participant is
entitled under any compensation plans of the Company, at the time such payments
are due. The Company will have no further obligations to such Participant under
this Plan.

 

3.7                                 Notice
of Termination.  Any termination of a
Participant’s employment by the Company for Cause or by the Participant for
Good Reason will be communicated by Notice of Termination to such Participant
or the Committee, as the case may be.

 

3.8                                 Payment
of Severance Benefits.  The Severance
Benefits described in Sections 3.2(a), (b) and (e), Sections 3.3(a), (b) and
(c) and Sections 3.4(a), (b) and (c) will be paid in cash to a Participant in a
single lump sum within 30 days following the date of the Qualifying Termination
of such Participant (or, if such Participant dies before payment is made, to
the Participant’s designated beneficiaries or estate within 30 days after the
date of such Participant’s death).

 

SECTION 4.                                RELEASE AND RESTRICTIVE COVENANTS

 

4.1                                 Release.
 The Severance Benefits are in
consideration of a Participant’s release of all claims against the Company
pursuant to an agreement with terms substantially similar to the terms of the
Separation Agreement and General Release of Claims set forth as Exhibit A
to this Plan (the “Release”). If a Participant does not execute the Release or
if he or she effectively revokes it, the Participant will not be entitled to
any Severance Benefits.

 

4.2                                 Restrictive
Covenants.  The Company’s obligation
to provide the Severance Benefits to a Participant will be conditioned on the
Participant’s continuing compliance with the confidentiality and
non-disparagement, non-competition and non-solicitation covenants set forth in
the Release.

 

4.3                                 Services
of Participant.  The Company’s
obligation to provide the Severance Benefits to a Participant will be
conditioned upon the Participant’s continuing compliance with the covenants to
provide services to the Company set forth in the Release.

 

11

 

SECTION 5.                                TRUST

 

5.1                                 Establishment
of Trust.  At any time but in no
event later than the date of a Change in Control, the Company will establish a
trust fund (the “Trust”) for the benefit of the Participants to secure the
Severance Benefits to be provided under this Plan. The Company will fund the
Trust with cash or with a letter of credit not later than such date of the
Change in Control, or such earlier date if authorized by the Committee. Notwithstanding
the foregoing, any obligations owed by the Company under this Plan are unfunded
and unsecured liabilities of the Company. In the event of the Company’s
insolvency or bankruptcy, the assets of the Trust will be treated like other
corporate assets of the Company and will be subject to the claims of the
Company’s creditors. Claims for benefits under this Plan will be treated like
any other claim by the Company’s unsecured creditors, with no special
preference for Participants.

 

5.2                                 Trust
Assets.  Interest earned on amounts
deposited by the Company into the Trust will be for the account of the Company,
and, after payment of all cash Severance Benefits to the Participants under
this Plan, any surplus amount held in the Trust will be retained by the Company.
In the event any Participant who is eligible for Severance Benefits becomes
subject to Taxes on the full amount held in the Trust for such Participant’s
benefit, the Company will directly pay any such taxes due from the Trust.

 

SECTION 6.                                EXCISE TAXES

 

6.1                                 Gross-Up
Payment.

 

(a)                                  In
the event a Participant becomes entitled to receive payments of Severance
Benefits under the Plan, the Company will cause an independent accounting or
other qualified firm (the “Tax Advisor”) promptly to review, at the Company’s
sole expense, the applicability of Section 4999 of the Code to those payments. The
Tax Advisor will determine whether the payment of Severance Benefits or any
other amounts by the Company to a Participant or for a Participant’s benefit
(whether paid or payable pursuant to the terms of this Plan or otherwise) (the “Total
Payments”), would be subject to the excise Tax imposed by Section 4999 of the
Code, and any interest or penalties with respect to such excise Tax (the excise
Tax, together with any such interest and penalties, are collectively referred
to herein as the “Excise Tax”).

 

(b)                                 If
the Tax Advisor determines that the Total Payments would be subject to any
Excise Tax, then the Participant will be entitled to receive an additional cash
payment (a “Gross-Up Payment”) equal to an amount such that after payment by
the Participant of all Excise Taxes and other taxes (including any interest or
penalties imposed with respect to such taxes) imposed upon the Gross-Up
Payment, the Participant would retain an amount of the Gross-Up Payment equal
to the Excise Tax imposed upon the Total Payments. For purposes of determining
the amount of any Tax pursuant to this Section 6.1, the Participant’s Tax rate
will be deemed to be the highest statutory marginal federal and state Tax rate
(on a combined basis and including the Participant’s share of FICA and Medicare
Taxes) then in effect.

 

12

 

(c)                                  Notwithstanding
Section 6.1(b), if the Tax Advisor determines that any Tier 2 Participant
is entitled to a Gross-Up Payment, but that the aggregate present value of the
Total Payments (determined pursuant to Section 280G of the Code and applicable
regulations promulgated thereunder) does not exceed 110% of the greatest amount
(the “Safe Harbor Amount”) that could be paid to any Tier 2 Participant
such that the receipt of payments under this Plan would not give rise to any
Excise Tax, then no Gross-Up Payment will be made to such Tier 2
Participant. In this case, the amounts payable under this Plan will be reduced
so that the aggregate present value of the Total Payments made to the
Tier 2 Participant is reduced to the Safe Harbor Amount. In the event that
a cut-back described in this Section 6.1(c) is required, amounts payable to the
Participant in cash shall be reduced first, followed by a reduction of other
benefits, as determined by the Tax Advisor. In the event that the Tax Advisor
has not made a final determination as to whether a reduction in the aggregate
present value of the Total Payments to the Tier 2 Participant is required
pursuant to this Section 6.1(c) as of the end of the six-month period following
the date provided in Section 3.8 of this Plan, the Company shall initially make
the payment provided by this Agreement to the Tier 2 Participant and he or
she will be required to refund to the Company any amounts ultimately determined
not to have been payable under the terms of this Plan.

 

(d)                                 A
Participant will in good faith cooperate with the Tax Advisor in making the
determination of whether a Gross-Up Payment is required (including, without
limitation, providing the Tax Advisor with information or documentation as
reasonably requested by the Tax Advisor).

 

(e)                                  Any
determination by the Tax Advisor regarding whether a Gross-Up Payment is
required and the amount of such Gross-Up Payment will be conclusive and binding
upon the Participant and the Company for all purposes.

 

6.2                                 Payment
Date.  Any Gross-Up Payment required
to be made by Section 6.1 will be paid to Participant within 30 days of a final
determination by the Tax Advisor that the Gross-Up Payment is required; provided,
however, that the Gross-Up Payment will not be paid earlier than the
Participant’s “earliest payment date,” which date will be the last day of the
six-month period following the date of the Participant’s Qualifying Termination
(or, if such Participant dies prior to the end of such six-month period, the
date of such Participant’s death). In any event, payment of any required
Gross-Up Payment will be made by the later of (a) the last day of the
taxable year in which the Participant’s earliest payment date occurs or
(b) the date that is two and one-half months after such earliest payment
date.

 

6.3                                 Controversies
with Taxing Authorities.

 

(a)                                  The
Company and a Participant will promptly deliver to each other copies of any
written communications (and written summaries of any oral communications) with
any taxing authority regarding the applicability of Section 280G or 4999 of the
Code to any portion of the Total Payments. In the event of any controversy with
the Internal Revenue Service or other taxing authority with regard to the
applicability of Section 280G or 4999 of the Code to any portion of the Total
Payments, the Company will have the right (exercisable in its sole discretion)
to control the resolution of such controversy at 

 

13

 

its own expense. The Participant and the Company will
cooperate in good faith in the resolution of such controversy.

 

(b)                                 If
the Internal Revenue Service or any other taxing authority makes a final
determination that a greater Excise Tax should be imposed upon the Total
Payments than is determined by the Tax Advisor or reflected in the Participant’s
Tax return pursuant to Section 6.2, the Participant will be entitled to receive
from the Company the full Gross-Up Payment calculated on the basis of the
amount of Excise Tax determined to be payable by the Internal Revenue Service
or such other taxing authority. Such amount will be paid to such Participant
within 30 days of the date of such final determination by the Internal Revenue
Service or such other taxing authority.

 

SECTION 7.                                CLAIMS PROCEDURE

 

7.1                                 Original
Claim.  Any Participant, former
Participant, or beneficiary of such Participant or former Participant, if he or
she so desires, may file with the Committee a written claim for Severance
Benefits under this Plan. Within 90 days after the filing of such a claim, the
Committee will notify the claimant in writing whether the claim is upheld or
denied (in whole or in part), or will furnish the claimant a written notice
describing specific special circumstances requiring a specified amount of
additional time (but not more than 180 days from the date the claim was filed)
to reach a decision on the claim. If the claim is denied in whole or in part,
the Committee will state in writing:

 

(a)                                  the
specific reasons for the denial;

 

(b)                                 the
pertinent provisions of this Plan on which the denial is based; and

 

(c)                                  any
additional material or information necessary for the claimant to perfect the
claim, and an explanation of why such material or information is necessary.

 

7.2                                 General
Rules.  The following general rules
will apply to all claims for Severance Benefits:

 

(a)                                  No
inquiry or question from a Participant regarding Severance Benefits will be
deemed to be a claim, unless made in accordance with the procedures described
in Section 7.1. The Committee may require that any claim for benefits be filed
on forms to be furnished to the claimant upon request.

 

(b)                                 All
decisions on claims will be made by the Committee;

 

(c)                                  The
Committee may, in its discretion, hold one or more hearings on a claim or a
request for a review of a denied claim;

 

(d)                                 A
claimant may be represented by a lawyer or other representative (at the
claimant’s own expense), but the Committee reserves the right to require the
claimant to furnish written notice that such lawyer or other representative is
authorized to represent the claimant;

 

14

 

(e)                                  The
decision of the Committee on a claim will be provided to the claimant in
writing. If a decision or notice is not received by a claimant within the time
specified, the claim or request for a review of a denied claim will be deemed
to have been denied; and

 

(f)                                    Prior
to filing a claim, the claimant or his or her lawyer or other representative
will have a reasonable opportunity to review a copy of this Plan and all other
pertinent documents in the possession of the Company.

 

SECTION 8.                                RIGHTS TO SEVERANCE BENEFITS AND LEGAL FEES

 

8.1                                 Severance
Benefits Payments.

 

(a)                                  This
Plan establishes in a Participant a right to the Severance Benefits to which
such Participant is entitled hereunder, subject to the conditions of
Section 4 and to the Committee’s right to terminate or amend this Plan in
accordance with Section 1.3 and 10.8. The Company’s obligation to make the payments
or distributions with respect to Severance Benefits will not be affected by any
circumstances (including, without limitation, any offset, counterclaim,
recoupment, defense or other right which the Company may have against the
Participant). Notwithstanding the foregoing sentence, the Company will have no
obligation to make any payment to any Participant under this Plan to the extent
(but only to the extent) that such payment is prohibited by the terms of any
final order of a federal or state court or regulatory agency of competent
jurisdiction. Such final order will not affect, impair or invalidate any
provision of this Plan not expressly subject to such order.

 

(b)                                 A
Participant will not be obligated to seek other employment in mitigation of the
Severance Benefits the Company is required to provide under this Plan, and the
obtaining of any such other employment will in no event effect any reduction of
the Company’s obligations to provide Severance Benefits under this Plan.

 

8.2                                 Legal
Fees and Expenses.  The Company will
pay all reasonable legal fees, costs of litigation, prejudgment interest and
other expenses that are incurred in good faith by a Participant as a result of
(a) the Company’s refusal to provide the Severance Benefits to which the
Participant becomes entitled under this Plan, (b) the Company (or any
third party) contesting the validity, enforceability or interpretation of this
Plan or (c) any conflict between the Participant and the Company
pertaining to this Plan; provided, however, that if a court
determines that the Participant’s claims were brought without a reasonable
belief in the merits of such claims, the Company will have no obligations under
this Section 8.2.

 

SECTION 9.                                SUCCESSORS

 

9.1                                 Successors
to the Company.  The Company will
require any successor to the Company (whether direct or indirect, by purchase,
merger, reorganization, consolidation, acquisition of property or stock,
liquidation or otherwise) to expressly assume and agree to perform this Plan in
the same manner and to the same extent that the Company would be required to
perform if no such succession had taken place. Regardless of whether such an
agreement to such express assumption is obtained, this Plan will be binding
upon any successor 

 

15

 

in accordance with
the operation of law, and such successor will be deemed to be the “Company” for
purposes of this Plan.

 

9.2                                 Assignment
by the Participant.  This Plan will
inure to the benefit of and be enforceable by the Participant’s personal or
legal representatives or designated beneficiaries. If the Participant dies
while any amount would still be payable to such Participant had he or she
continued to live, all such amounts will be paid in accordance with the terms
of this Plan to such Participant’s designated (or, if there are no such
designated beneficiaries, to the Participant’s estate).

 

SECTION 10.                          MISCELLANEOUS

 

10.1                           Administration
and Committee Powers.  This Plan will
be administered by the Committee. The Committee will have full power,
discretion and authority to interpret and construe this Plan, and the Committee’s
interpretation and construction of this Plan will be conclusive and binding on
the Participants, the Company and all other Persons.

 

10.2                           Employment
Status.  This Plan is not, and
nothing herein will be deemed to create, an employment contract between the
Participant and the Company. The Company may at any time change any Participant’s
compensation, title, employment responsibilities, job location and any other
aspect of the Company’s employment relationship with such Participant, or
terminate such Participant’s employment prior to a Change in Control (subject
to such termination being determined to be a Pre-Change in Control Qualifying
Termination pursuant to Section 3.1(b)).

 

10.3                           Entire
Plan and Other Change in Control Plans.

 

(a)                                  This
Plan contains the entire understanding of the Company and the Participant with
respect to the subject matter hereof. In addition, the payment of any Severance
Benefits in the event of a Participant’s termination of employment will be in
lieu of any severance benefits payable under any other severance plan, program
or policy of the Company to which the Participant might otherwise be entitled.

 

(b)                                 This
Plan completely supersedes any and all prior change in control severance
agreements, understandings or plans (including, without limitation, the Income
Security Plan, as in effect immediately prior to the Effective Date), oral or
written, entered into between the Company and a Participant.

 

10.4                           Notices.
 All notices, requests, demands, and
other communications hereunder will be sufficient if in writing and will be
deemed to have been duly given if delivered by hand or if sent by registered or
certified mail to the Participant at the last address he or she has filed in
writing with the Company, or, in the case of the Company, at its principal
executive offices.

 

10.5                           Includable
Compensation.  Severance Benefits
provided hereunder will not be considered “includable compensation,” “recognized
compensation,” “recognized earnings” or “final average earnings” for purposes
of determining the Participant’s benefits under any other plan or program of
the Company, unless otherwise expressly provided in such other plan or program.

 

16

 

10.6                           Tax
Withholding.  The Company will
withhold from any amounts payable under this Plan all federal, state or other
Taxes legally required to be withheld.

 

10.7                           Severability.
 In the event any provision of this Plan
is held illegal or invalid for any reason, the illegality or invalidity will
not affect the remaining parts of this Plan, and this Plan will be construed
and enforced as if the illegal or invalid provision had not been included.

 

10.8                           Amendment
and Waiver.

 

(a)                                  Any
provision of this Plan may be amended or modified (which modification may
include the termination of any Participant’s participation in this Plan) by the
Committee at any time; provided, however, that (i) during
the period beginning on the date of a Change in Control and ending on the third
anniversary date of such Change in Control, no provision of this Plan may be
amended or modified (unless such modification or waiver is agreed to in writing
by any affected Participant) and (ii) if a Change Event occurs during the
12-month period immediately prior to the date of a Change in Control, any
amendment or modification to this Plan during such 12-month period will be
deemed null and void (unless such modification or amendment is agreed to in
writing by any affected Participant).

 

(b)                                 Any
provisions of this Agreement may be waived in writing by the Company or the
Participant, as the case may be.

 

10.9                           Applicable
Law.  The laws of the State of
Delaware will be the controlling law in all matters relating to this Plan
without giving effect to principles of conflicts of laws.

 

10.10                     Rules of
Construction.  Captions are provided
in this Plan for convenience only, and such captions will not serve as a basis
for interpretation or construction hereof. Unless otherwise expressly provided
or unless the context otherwise requires, the terms defined in this Plan
include the plural and the singular.

 

17

 

Exhibit
A

 

[FORM
AGREEMENT for INCOME SECURITY PLAN]

 

SEPARATION
AGREEMENT

 

AND

 

GENERAL
RELEASE OF CLAIMS

 

This
Separation Agreement and General Release of Claims (“Agreement” or “General
Release”) is made and entered into by and between [employee name], on behalf of
his/her agents, assigns, heirs, executors, administrators, attorneys and
representatives (“I,” “me,” “Employee”), and Alliant Techsystems Inc., a
Delaware corporation, [include new company name if applicable] any related
corporations or affiliates, subsidiaries, predecessors, successors and assigns,
present or former officers, directors, stockholders, board members, agents,
employees, and attorneys, whether in their individual or official capacities,
delegates, benefit plans and plan administrators, and insurers (“Company” or “ATK”).

 

WHEREAS, ATK
and I have mutually agreed that my employment shall terminate as provided in
this General Release. In consideration of my signing and complying with this
General Release, ATK agrees to provide me with certain payments and other
valuable consideration described below. Further, ATK and I desire to resolve
and settle any and all potential disputes or claims related to my employment or
termination of employment.

 

WHEREAS, this
Separation Agreement and General Release is given in consideration of benefits
received pursuant to the Alliant Techsystems Inc. Income Security Plan.

 

WHEREAS, ATK
has expended significant time and money on promotion, advertising, and the
development of goodwill and a sound business reputation through which it has
developed a list of customers and spent time and resources to learn the
customers’ needs for ATK’s services and products. This information is valuable,
special and unique assets of ATK’s business, which I acknowledge constitutes
confidential information.

 

WHEREAS, ATK
has expended significant time and money on technology, research, and
development through which it has developed products, processes, technologies
and services, that are valuable, special and unique assets of ATK’s business,
which I acknowledge constitute confidential information.

 

WHEREAS, the
disclosure to or use by third parties of any of ATK’s confidential or
proprietary information, trade secrets, or my unauthorized use of such
information would seriously harm ATK’s business and cause monetary loss that
would be difficult, if not impossible, to measure.

 

THEREFORE, ATK
and I mutually agree to the following terms and conditions:

 

A-1

 

1.                                       Termination
of Employment.  I understand my
employment with ATK is terminated effective [date].

 

(a)                                  Final
Paycheck.  My final paycheck will
include (a) all salary earned through the effective date of the termination of
my employment with ATK, (b) any accrued, but unused vacation/PTO, and (c) any
cash amounts completely earned and owing under any bonus plan, but not yet
paid.

 

(b)                                 Deferred
Compensation.  Any compensation I
deferred under the Alliant Techsystems Inc. Nonqualified Deferred Compensation
Plan (or predecessor or successor plan) shall be paid in accordance with my
pre-selected distribution options, if applicable, and the terms of that plan.

 

2.                                       Severance
Benefits.  In exchange for the
promises contained herein, ATK will provide me with the severance benefits
contained in the ATK Income Security Plan and with any additional benefits
identified in this Paragraph 2 (together referred to as “Severance Benefits”):

 

(a)                                  Severance
Pay.  I am eligible to receive a
single lump-sum severance payment in the amount of [$          ], which is made up of [list the
amount and category of compensation, ex: 
base salary, annual incentive bonus, etc...]. This severance payment will
be subject to all applicable withholdings and will be taxable as payroll wages.
No 401(k) deductions will be taken from the payment nor is it pensionable
earnings (for example, it is not “Earnings” or “Recognized Compensation”) for
purposes of any ATK qualified or non-qualified employee benefits plans.

 

(b)                                 Additional
Lump Sum.  I am eligible to receive a
single lump-sum payment in the amount of [$          ] in consideration of certain
perquisites and benefits. This amount will be subject to all applicable
withholdings and will be taxable as payroll wages. No 401(k) deductions will be
taken from the payment nor is it pensionable earnings (for example, it is not “Earnings”
or “Recognized Compensation”) for purposes of any ATK qualified or
non-qualified employee benefits plans.

 

(c)                                  Equity
Awards

 

(i)                                     Restricted
Stock.  [I have xx shares of
restricted stock which will become nonforfeitable and free and clear of the
restrictions of the plan from which they were issued.]

 

(ii)                                  Performance
Shares.  [Identify outstanding
performance shares. Provide details on grant, vesting and delivery. Include the
number of shares, proration, if any, and delivery.]

 

(iii)                               Stock
Options.  [Identify status of stock
options. Provide details on the number of shares, the grant, vesting, and
exercisability.]

 

A-2

 

(d)                                 Independent
Consideration.  I am only eligible
for Severance Benefits because I have signed and not revoked this General
Release. I acknowledge that I am not otherwise entitled to receive such
additional and valuable consideration. By my signature on this General Release,
I waive all rights to any other benefits or cash payment. Further, I agree that
these Severance Benefits are adequate consideration for my promises herein.

 

(e)                                  Delivery
of Severance Pay and Additional Lump Sum.  ATK will deliver to me the cash amounts under
paragraph 2(a) and (b), the Severance pay and additional lump sum, within 30
days of six months after my termination date, provided that the applicable
rescission period has also elapsed. This delivery date may be delayed further
if necessary to be compliant with Section 409A of the U.S. Internal Revenue
Code of 1986, as amended from time to time.

 

3.                                       Post
Employment Restrictions.

 

(a)                                  Confidentiality
and Non-Disparagement.  I acknowledge
that in the course of my employment with ATK, I have had access to confidential
information and trade secrets. If I hold a U.S. Government issued security
clearance, I acknowledge my personal obligations to maintain the
confidentiality of information gained under that clearance. I agree to maintain
the confidentiality of ATK’s confidential information and trade secrets. I will
not disclose or otherwise make available to any person, company, or other party
confidential information or trade secrets. Further, I agree not to make any
disparaging or defamatory comments about any ATK employee, director, or
officer, the Company, or any aspect of my employment or termination from
employment with ATK.

 

(b)                                 Competition
Restrictions.  From [date] through
[date – Tier 1 – 3 years, Tier 2 – 2 years], I
agree I will not directly or indirectly, engage in, nor own, manage, operate,
join, control, consult with, participate in the ownership, operation or control
of, or be employed by any person or entity that develops, manufactures,
distributes, markets or sells services or products competitive with those that
ATK manufactures, markets or sells to any customer anywhere in the world. If
during this restricted period I wish to obtain other non-competitive
employment, I agree to meet and confer in good faith with ATK, prior to
accepting such employment. I will provide ATK with the name of any potential
future employer and give ATK the right to provide a copy of this provision to
said potential employer.

 

(c)                            Non-solicitation.
 From [date] through [date – Tier 1 – 3
years, Tier 2 – 2 years], I will not, directly or indirectly solicit any of ATK’s
employees for the purpose of hiring them or inducing them to leave their
employment with ATK, nor will I own manage, operate, join, control, consult
with, participate in the ownership, management, operation or control of, or be
employed by any person or entity that engages in the conduct proscribed by this
paragraph during the restricted period.

 

(d)                           Access.
 I agree to be available to ATK for up to
thirty hours per month [if Tier 1 – for one year, if Tier 2 – for 6 months],
from my termination date to aid in transitioning information, supporting
customer’s needs or other requests of ATK.

 

A-3

 

(e)                            Breach
of Post-Employment Restrictions.  If
I breach any of my obligations under this Paragraph 3, then I will not be
entitled to, and shall return, 75 percent of the Severance Benefit provided in
Paragraph 2. ATK will be entitled to attorney’s fees and costs incurred in
seeking injunctive relief and damages including collecting the repayment of
applicable consideration as specified above. Such action on the part of ATK
will not in any way affect the enforceability of my General Release of Claims
provided in Paragraph 5, which is adequately supported by the remaining
Severance Benefits provided in Paragraph 2.

 

4.                                       Return
of ATK Property.  Prior to my last
day of employment, I agree to return all ATK property in my possession or
control including, but not limited to, confidential or proprietary information,
credit card, computer, documents, records, correspondence, identification
badge, files, keys, software, and equipment. Further, I agree to repay to ATK
any amounts that I owe for personal credit card expenses, wage advances,
employee store purchases, and used, but unaccrued, vacation/PTO time. These
debts may be withheld from my severance payment, if any.

 

5.                                       General
Release of Claims.  Except as stated
in Paragraph 7, I hereby release and forever discharge ATK from all claims and
causes of action, whether I currently have knowledge of such claims and causes
of action, arising, or which may have arisen, out of or in connection with my
employment or termination of employment with ATK. This includes, but is not
limited to claims, demands or actions arising under any federal or state law
such as the Age Discrimination in Employment Act (“ADEA”), the Older Workers
Benefit Protection Act (“OWBPA”), Title VII of the Civil Rights Act of 1964 (“Title
VII”), the Americans with Disabilities Act (“ADA”), the Family Medical Leave
Act (“FMLA”), the Employee Retirement Income Security Act of 1978 (“ERISA”),
the Worker Adjustment Retraining and Notification Act (“WARN”), the Fair Labor
Standards Act (“FLSA”), the National Labor Relations Act (“NLRA”), the
Occupational Safety and Health Act (“OSHA”), the Rehabilitation Act, the
Minnesota Human Rights Act, and Minn. Stat. Chap. 181, all as amended.

 

This General Release includes
any claims arising under state human rights or fair employment practices act,
or any other federal, state or local statute, ordinance, regulation or order
regarding conditions of employment, compensation for employment, termination of
employment, or discrimination or harassment in employment on the basis of age,
gender, race, religion, disability, national origin, sexual orientation, or any
other protected characteristic, and the common law of any state.

 

I further understand that this
General Release extends to all claims which I may have as of this date against
ATK based upon statutory or common law claims for breach of contract, breach of
employee handbooks or other policies, breach of promises, fraud, wrongful
discharge, defamation, emotional distress, whistleblower claims, negligence,
assault, battery, or any other theory, whether legal or equitable.

 

I agree that
this General Release includes claims for all damages available under any theory
of recovery, including, without limitation, any compensatory damages (including
all forms of back-pay or front-pay), attorneys’ fees, liquidated damages,
punitive damages, treble damages, emotional distress damages, pain and
suffering damages, consequential damages, incidental 

 

A-4

 

damages,
statutory fines or penalties, and/or costs or disbursements. Except as stated
in Paragraph 7, I am completely and fully waiving any rights under the above
stated statutes, regulations, laws, or legal or equitable theories.

 

6.                                       Breach
of General Release of Claims.  If I
breach any provision of the General Release of Claims provided in Paragraph 5,
then I will not be entitled to, and shall return, 25 percent of the Severance
Benefit provided in Paragraph 2. ATK will be entitled to attorney’s fees and
costs incurred in its defense including collecting the repayment of applicable
consideration. Such action on the part of ATK will not in any way effect the
enforceability of the Post-Employment Restrictions provided in Paragraph 3,
which are adequately supported by the remaining Severance Benefits provided in
Paragraph 2.

 

7.                                       Exclusions
from General Release.  I am not
waiving my right to enforce the terms of this General Release or to challenge
the knowing and voluntary nature of this General Release under the ADEA as
amended; or my right to assert claims that are based on events that happen
after this General Release becomes effective. I agree that ATK reserves any and
all defenses, which it has or might have against any claims brought by me. This
includes, but is not limited to, ATK’s right to seek available costs and
attorneys’ fees, and to have any money or other damages that might be awarded
to me, reduced by the amount of money paid to me pursuant to this General
Release. Nothing in this General Release interferes with my right to file a
charge with the Equal Employment Opportunity Commission (“EEOC”), or to participate
in an EEOC investigation or proceeding. Nevertheless, I understand that I have
waived my right to recover any individual relief or money damages, which may be
awarded on such a charge.

 

8.                                       Right
to Revoke.  This General Release does
not become effective for a period of fifteen (15) days after I sign it and I
have the right to cancel it during that time. Any decision to revoke this
General Release must be made in writing and hand-delivered to ATK or, if sent
by mail, postmarked within the fifteen (15) day time period and addressed to
[insert name] Alliant Techsystems Inc., 5050 Lincoln Drive, Edina, MN 55436. I
understand that if I decide to revoke this General Release, I will not be
entitled to any Severance Benefits.

 

9.                                       Unemployment
Compensation Benefits.  If I apply
for unemployment compensation, ATK will not challenge my entitlement to such
benefits. I understand that ATK does not decide whether I am eligible for
unemployment compensation benefits, or the amount of the benefit.

 

10.                                 No
Wrongdoing.  By entering into this
General Release, ATK does not admit that it has acted wrongfully with respect
to my employment or that I have any rights or claims against it.

 

11.                                 No
Adequate Remedy at Law.  I
acknowledge and agree that my breach of the Post-Employment Restrictions
provided in Paragraph 3 would cause irreparable harm to the Company and the
remedy at law would be inadequate. Accordingly, if I violate such Paragraph,
ATK is entitled to injunctive relief in addition to any other legal or
equitable remedies.

 

12.                                 Choice
of Law and Venue.  The terms of this
General Release will be governed by the laws of Minnesota (without regard to
conflict of laws principles). Any legal action to enforce this General Release
shall be brought in a court of law in Hennepin County, Minnesota.

 

A-5

 

13.                                 Severability.
 If any of the terms of this General
Release are deemed to be invalid or unenforceable by a court of law, the validity
and enforceability of the remaining provisions of this General Release will not
in any way be affected or impaired thereby. In the event that any court having
jurisdiction of the parties should determine that any of the post-employment
restrictions set forth in Paragraph 3 of this Agreement are overbroad or
otherwise invalid in any respect, I acknowledge and agree that the court so
holding shall construe those provisions to cover only that scope, duration or
extent or those activities which may validly and enforceably be restricted, and
shall enforce the restrictions as so construed. The parties acknowledge the
uncertainty of the law in this respect and expressly stipulate that this
Agreement shall be construed in a manner which renders its provisions valid and
enforceable to the maximum extent (not exceeding its express terms) possible
under applicable law.

 

14.                                 No
Assignment.  This General Release is
personal to me and I cannot assign it to any other person or entity. In the
event of my death before all payments due to me under the terms of this Agreement
have been made, then all such payments shall continue to be made to my estate.

 

15.                                 Attorneys’
Fees. I understand that I am responsible to pay my own costs and attorneys’
fees, if any, that I incurred in consulting with an attorney about this General
Release.

 

16.                                 Entire
Agreement.  This General Release
constitutes the entire agreement between ATK and me regarding the subject
matter included in this document. I agree that there are no promises or
understandings outside of this General Release, except with respect to my
continuing obligations not to reveal ATK’s proprietary, confidential, and trade
secret information. This General Release supercedes and replaces all prior or
contemporaneous discussions, negotiations or General Releases, whether written
or oral, except as set forth herein. Any modification or addition to this
General Release must be in writing, signed by an officer of ATK and me.

 

17.                                 Eligibility
and Opportunity to Review.

 

(a)                                  All
employees who are eligible to participate in the Alliant Techsystems Inc.
Income Security Plan must execute a release of claims in order to receive
Severance Benefits.

 

(b)                                 I
certify that I am signing this General Release voluntarily and with full
knowledge of its consequences. I understand that I have at least [use either: “twenty-one
(21) days” if individual termination or “forty-five (45) days” if more than one
person being terminated]  from the date I
received this General Release to consider it, and that I do not have to sign it
before the end of the twenty-one (21) day period. I have been advised to use
this time to consult with an attorney prior to executing this General Release.

 

(c)                                  I
understand that the offer to accept this General Release remains open for [use “twenty-one
(21)” or use “forty-five (45)” – see comment in (b) above] days. If I have not
signed this General Release within [“twenty-one (21)” or “forty-five (45)” –
see comment in (b) above] days of receiving it, then this offer expires and ATK
will be under no obligation to accept this General Release or to provide me any
Severance Benefits.

 

A-6

 

18.                                 Understanding
and Acknowledgement. I understand all of the terms in this General Release and
I have not relied on any oral statements or explanations by ATK. I have had
adequate time to consult with legal counsel and to consider whether to sign
this General Release, and I am signing it knowingly and voluntarily. 

 

IN WITNESS WHEREOF, Employee has executed
this General Release by his signature below.

 

	
  Date:

  	
   

  	
   

  	
  [Insert employee name]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Employee’s Signature

  

 

A-7Exhibit 10.9

 

	
  

  	
  

  PERFORMANCE AWARD AGREEMENT

  

 

 

1.        The Grant.  Alliant Techsystems Inc., a Delaware
corporation (the “Company”), hereby grants to you, on the terms and conditions
set forth in this Performance Award Agreement (this “Agreement”) and in the Alliant
Techsystems Inc. 2005 Stock Incentive Plan (the “Plan”), a Performance Award as
of the date, and for the number of Shares (the “Performance Shares”), which the
Company or its agent provided to you separately in writing through an
electronic notice and on-line award acceptance web page (the “Electronic
Notice and On-Line Award Acceptance”).

 

2.        Measuring Period.  The Measuring Period for purposes of
determining whether the Company will pay you the Performance Shares shall be fiscal years 2007 through 2009.

 

3.        Performance Goals.  The Performance Goals for purposes of
determining whether the Company will pay you the Performance Shares are set
forth in the Performance Accountability Chart, which the Company provided to
you separately in writing.

 

4.        Payment.  The Company will pay you the Performance
Shares if and to the extent that the Performance Goals are achieved, as set
forth in the Performance Accountability Chart and as determined by the
Personnel and Compensation Committee of the Company’s Board of Directors (the “Committee”)
in its sole discretion.

 

5.        Form and Timing of Payment. The Company
will pay you any shares payable pursuant to this Agreement in shares of common
stock of the Company (the “Shares”), with one Share issued for each Performance
Share earned.  The Company will pay you
the Performance Shares as soon as practicable after the Committee determines,
in its sole discretion, after the end of the Measuring Period, whether, and the
extent to which, the Performance Goals have been achieved, but in no event
later than 2 1⁄2 months after the end of the Measuring Period.

 

6.        Change in
Control.  After a
Change in Control (as defined in Appendix A to this Agreement), the Performance
Shares shall immediately be payable at the median performance level, but
prorated for your active service time with the Company during the Measuring
Period.  However, if you are or become a
participant in the Company’s Income Security Plan or any successor or
substitute plan (the “ISP”), the terms of payment of the Performance Shares
shall be governed by the provisions of the ISP.

 

7.        Forfeiture.  In the event of your termination of
employment prior to the end of the Measuring Period, other than by reason of death, Disability (as
defined in Appendix A to this Agreement), retirement, or voluntary or
involuntary layoff, all of your Performance Shares and rights to payment of any
Shares shall be immediately and irrevocably forfeited.  In the event of your termination of
employment prior to the end of the Measuring Period by reason of Disability,
retirement, or voluntary or involuntary layoff, you shall be entitled to
receive, after the end of the Measuring Period, the number of Shares determined
by the Committee pursuant to this Agreement, but prorated for your active
service time with the Company during the Measuring Period.  In the event of your death prior to the end
of the Measuring Period, your estate shall be entitled to receive, within a
practicable time after your death, payment of the Performance Shares at the median performance level, but prorated
for your active service time with the Company during the Measuring Period.  In the event you are reassigned to a position
and as a result you are no longer eligible for Performance Shares, you shall be
entitled to receive, after the end of the Measuring Period, the number of
Shares determined by the Committee pursuant to this Agreement, but prorated for
your service time as an eligible participant during the Measuring Period.

 

8.        Rights.  Nothing herein shall be deemed to grant you
any rights as a holder of Shares unless and until the Company actually issues
the Shares to you as provided herein.

 

9.        Income Taxes.  You are liable for any federal, state and
local income or other taxes applicable upon the grant of the Performance Shares,
the receipt of the Shares, or subsequent disposition of the Shares, and you
acknowledge that you should consult with your own tax advisor regarding the
applicable tax consequences.  Upon
payment of the Performance Shares and/or issuance of the Shares to you, the
Company will pay your required minimum statutory withholding taxes by
withholding Shares otherwise to be delivered upon the payment of the
Performance Shares with a Fair Market Value (as defined in the Plan) equal to
the amount of such taxes.  Alternatively,
if you notify the Company prior to the end of the Measuring Period, you may
elect to pay all or a portion of the minimum statutory withholding taxes by (a) delivering
to the Company Shares other than Shares issuable upon the payment of the
Performance Shares
with a Fair Market Value equal to the amount of such taxes or (b) paying
cash, provided that if you do not deliver such Shares or cash to the Company by
the second business day after the payment date of the Performance Shares, the
Company will pay your required minimum statutory withholding taxes by
withholding Shares otherwise to be delivered upon the payment of the
Performance Shares with a Fair Market Value equal to the amount of such taxes.

 

10.  Acknowledgment.  This Award of Performance Shares shall not be
effective until you agree to the terms and conditions of this Agreement and the
Plan, and acknowledge receipt of a copy of the Prospectus relating to the Plan,
by accepting this Award in writing or electronically as specified by the
Company or its agent in the Electronic Notice and On-Line Award Acceptance.

 

	
  ALLIANT TECHSYSTEMS INC.

  
	
  

  
	
  Daniel J. Murphy

  
	
  President & Chief
  Executive Officer

  

 

 

Alliant
Techsystems Inc. 2005 Stock Incentive Plan

 

Appendix A to Award Agreement

 

“Change in Control” means any of the following:

 

•                  The acquisition by any “person” or group of
persons (a “Person”), as such terms are used in Section 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other
than the Company or a “Subsidiary” (as defined below) or any Company employee
benefit plan (including its trustee)) of “beneficial ownership” (as defined in Rule 13d-3
under the Exchange Act) (“Beneficial Ownership”), directly or indirectly, of
securities of the Company representing, directly or indirectly, more than 50%
of the total number of shares of the Company’s then outstanding “Voting
Securities” (as defined below);

 

•                  consummation of a reorganization, merger or
consolidation of the Company, or the sale or other disposition of all or
substantially all of the Company’s assets (a “Business Combination”), in each
case, unless, following such Business Combination, the individuals and entities
who were the beneficial owners of the total number of shares of the Company’s outstanding
Voting Securities immediately prior to both (1) such Business Combination,
and (2) any “Change Event” (as defined below) occurring within 12 months
prior to such Business Combination, beneficially own, directly or indirectly,
more than 50% of the total number of shares of the outstanding Voting
Securities of the resulting corporation, or the acquiring corporation, as the
case may be, immediately following such Business Combination (including,
without limitation, the outstanding Voting Securities of any corporation which
as a result of such transaction owns the Company or all or substantially all of
the Company’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination, of the total number of shares of the Company’s
outstanding Voting Securities; or

 

•                  any other circumstances (whether or not
following a Change Event) which the Company’s Board of Directors (the “Board”)
determines to be a Change in Control for purposes of this Plan after giving due
consideration to the nature of the circumstances then represented and the
purposes of this Plan.  Any such
determination made by the Board shall be irrevocable except by vote of a
majority of the members of the Board who voted in favor of making such
determination.

 

For purposes of this definition, a “Change in
Control” shall not result from any transaction precipitated by the Company’s
insolvency, appointment of a conservator, or determination by a regulatory
agency that the Company is insolvent.

 

For purposes of this definition:

 

•                  “Change Event” means

 

(1)          the acquisition by any Person (other than the Company or a Subsidiary
or any Company employee benefit plan (including its trustee)) of Beneficial
Ownership, directly or indirectly, of securities of the Company directly or
indirectly representing 15% or more of the total number of shares of the
Company’s then outstanding Voting Securities (excluding the sale or issuance of
such securities directly by the Company, or where the acquisition of such
securities is made by such Person from five or fewer stockholders in a
transaction or transactions approved in advance by the Board);

 

 

(2)          the public announcement by any Person of an intention to acquire the
Company through a tender offer, exchange offer, or other unsolicited proposal;
or

 

(3)          the individuals who are members of the Board (the “Incumbent Board”) as
of the Grant Date set forth in the Award Agreement cease for any reason to
constitute at least a majority of the Board; provided, however, that if the
nomination for election of any new director was approved by a vote of a
majority of the Incumbent Board, such new director shall, for purposes of this
definition, be considered a member of the Incumbent Board.

 

•                  “Subsidiary” means a corporation as defined
in Section 424(f) of the Internal Revenue Code with the Company being
treated as the employer corporation for purposes of this definition.

 

•                  “Voting Securities” means any shares of the
capital stock or other securities of the Company that are generally entitled to
vote in elections for directors.

 

*               *               *               *

 

“Disability” means
that you have been determined to have a total and permanent disability either
by

 

•                  being eligible
for disability for Social Security purposes, or

 

•                  being totally
and permanently disabled under the Company’s long-term disability plan.

 

A-2

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