Document:

Form of Employee Stock Purchase Plan

 Exhibit 10.26 
  

	
	Employee Stock Purchase Plan
	
	Knoll, Inc.
	
	 Effective             , 2004

  
  
  

	
	 This material is intended to
 aid in the implementation
of
 the Plan by providing an
 initial draft for review

by representatives of Knoll
 and its legal counsel.

 Contents 
  

			
		
	 Article 1. Purpose and Effective Date
	  	1
		
	 Article 2. Definitions
	  	1
		
	 Article 3. Administration
	  	5
		
	 Article 4. Number of Shares
	  	5
		
	 Article 5. Eligibility Requirements
	  	6
		
	 Article 6. Enrollment
	  	6
		
	 Article 7. Grant of Options on Enrollment
	  	7
		
	 Article 8. Payment
	  	7
		
	 Article 9. Purchase of Shares
	  	7
		
	 Article 10. Withdrawal from the Plan and Termination of Employment
	  	8
		
	 Article 11. Designation of Beneficiary
	  	9
		
	 Article 12. Miscellaneous
	  	9

  

 Knoll, Inc. 
 Employee Stock Purchase Plan 
  
 Article 1. Purpose and
Effective Date 
  
 1.1 The purpose of the Knoll, Inc.
Employee Stock Purchase Plan (the “Plan”) is to provide an opportunity for employees of Knoll, Inc. (the “Company”) and employees of the Participating Affiliates (as defined below) to purchase shares of common stock of the
Company (the “Purchase Rights”) in a way which is both convenient and on a basis more favorable than would otherwise be available. The Company believes that employee participation in ownership of the Company on this basis will be to the
mutual benefit of both the employee and the Company. 
  
 It is the
intent of the Company to have the Plan qualify as an “employee stock purchase plan” under Section 423 of the Internal Revenue Code, although the Company makes no undertakings nor representations to maintain such qualification. In addition,
this Plan document authorizes the grant of Options under a non-Code Section 423 plan which do not qualify under Section 423 of the United States Section 423 of the Internal Revenue Code pursuant to rules, procedures, or sub-plans adopted by the
Committee (as defined below) designated to achieve desired tax or other objectives. 
  
 1.2 It is intended that Purchase Periods will commence, if at all, at such times designated by the Committee. 
  
 1.3 The Plan shall be effective on             , 2004 (the “Effective
Date”) subject to the approval of the Company’s stockholders within one (1) year the date the Plan is approved by the Board. The Plan shall remain in effect in accordance with Section 12.7 of the Plan. 
  
 Article 2. Definitions 
  
 Whenever used in the Plan, the following terms shall have the meanings set forth below, and when the meaning is intended,
the initial letter of the word shall be capitalized: 
  

	 	2.1	“Account” means a recordkeeping account maintained for a Participant to which payroll deductions, if applicable, shall be credited. 

 

	 	2.2	“Affiliate” means any (i) Subsidiary and (ii) other entity in which the Company has an ownership interest greater than fifty percent (50%) voting securities
of such entity. 

  

	 	2.3	“Board” means the Board of Directors of the Company. 

	

  

 1 

	 	2.4	“Change in Control” shall be deemed to occur if: 

  

	 	(a)	Any person (as defined in Section 3(a)(9) of the Exchange Acts, and as used in Sections 13(d) and 14(d) thereof, including any “group” as defined in Section 13(d)(3)
thereof (a “Person”), but excluding the Company, any Subsidiary, Warburg, Pincus & Co., Warburg, Pincus Ventures, L.P. and any affiliates of either (excluding any “portfolio companies” owned directly or indirectly, in whole
or in part, by either (“Warburg”), and any employee benefit plan sponsored or maintained by the Company or any Subsidiary (including any trustee of such plan acting as trustee), becomes the beneficial owner of Shares of the Company having
at least 50% of the total number of votes that may be cast for the election of directors of the Company (the “Voting Shares”) provided, however, that such an event shall not constitute a Change in Control if the acquiring Person has
entered into an agreement with the Company approved by the Board which materially restricts the right of such Person to direct or influence the management or policies of the Company; 

  

	 	(b)	The shareholders of the Company shall approve, and there shall have been consummated, any merger of other business combination of the Company, sale of the Company’s assets or
combination of the foregoing transactions (a “Transaction”) other than a Transaction involving only the Company and one or more of its Subsidiaries, or a Transaction immediately following which the shareholders of the Company immediately
prior to the Transaction continue to have a majority of the voting power in the resulting entity; or 

  

	 	(c)	Within any 24-month period beginning on or after the Company’s Initial Public Offering (the “IPO”), the persons who were members of the Board on or immediately before
the beginning of such period (the “Incumbent Directors”) shall cease (for any reason other than death) to constitute at least a majority of members of the Board or the board of directors of any successor to the Company, provided that any
director who was not a director as of the IPO shall be deemed to be an Incumbent Director (A) if such director was elected to the Board by, or on the recommendation of or with the approval of, at least a majority of the directors who then qualified
as Incumbent Directors, either actually or by prior operation of this definition or (B) if such director was appointed at the direction of Warburg at a time when Warburg owned more than 50% of the Voting Shares. Notwithstanding the foregoing, no
Change in Control shall be deemed to have occurred for purposes of this Plan by reason of any decrease in the share ownership of Warburg, to the extent such decrease is attributable to such shareholder having distributed Shares owned by it directly
to one or more members of the Warburg investment group. Members of the Warburg investment group shall be limited to Warburg, partners of any entity which is included in the definition of the term “Warburg” and any other investment
partnership sponsored by Warburg, but shall not include any portfolio companies of any of them. For purpose of the Plan, “IPO Date” shall mean the day the Company’s Shares become publicly traded. 

	

  

 2 

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

  

	 	2.6	“Committee” means the Compensation Committee of the Board. The members of the Committee shall be appointed from time to time by and shall serve at the discretion of
the Board. 

  

	 	2.7	“Company” means Knoll, Inc. a Delaware corporation. 

  

	 	2.8	“Cut-Off Date” means the date established by the Committee from time to time by which enrollment forms must be received prior to an Enrollment Date.

  

	 	2.9	“Eligible Employee” means an Employee eligible to participate in the Plan in accordance with Article 5. 

  

	 	2.10	“Employee” means any active employee of the Company or a Participating Affiliate. 

  

	 	2.11	“Enrollment Date” means the first Trading Day of a Purchase Period. 

  

	 	2.12	“Exchange Act” means the United States Securities Exchange Act of 1934, as amended. 

  

	 	2.13	“Fair Market Value” shall mean, as of any date, the value of a Share determined as follows: 

  

	 	(a)	If the Shares are listed on any established stock exchange or a national market system, including without limitation the National Market System of the Association of Securities
Dealers, Inc. Automated Quotation System (“NASDAQ”), its Fair Market Value shall be the average of the high and low sale price for a Share (or the average of the closing bid and asked prices, if no sales were reported), as quoted on such
exchange (or the exchange with the greatest volume of trading in Common Stock) or system on the date of such determination, if such date is a Trading Day, or if such date is not a Trading Day, then on the Trading Day immediately preceding such date,
as reported in The Wall Street Journal or such other source as the Board deems reliable; or 

  

	 	(b)	If the Shares are quoted on NASDAQ (but not on the National Market system thereof) or is regularly quoted by a recognized securities dealer but selling prices are not reported, its
Fair Market Value shall be the average of the closing bid and asked prices for the Shares on the date of such determination, if such date is a Trading Day, or if such date is not a Trading Day, then on the Trading Day immediately preceding such
date, as reported in The Wall Street Journal or such other source as the Board deems reliable; or 

  

	 	(c)	In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Board. 

  

 3 

	 	2.14	“Grant Date” means a date on which an Eligible Employee is granted an option under the Plan pursuant to Article 7. 

  

	 	2.15	“Grant Price” means the Fair Market Value of a Share on the Grant Date for such option. 

  

	 	2.16	“Participant” means an Eligible Employee who has enrolled in the Plan pursuant to Article 6. 

  

	 	2.17	“Participating Affiliate” means an Affiliate which has been designated by the Committee in accordance with Section 3.2 of the Plan as covered by the Plan. In the
event the designated Affiliate is not a Subsidiary, it shall be designated for participation in the non-Code Section 423 portion of the Plan. 

  

	 	2.18	“Purchase Date” with respect to a Purchase Period means the last Trading Day in such Purchase Period. 

  

	 	2.19	“Purchase Date Price” means the Fair Market Value of a Share on the applicable Purchase Date. 

  

	 	2.20	“Purchase Period” means the purchase period designated by the Committee; provided, that each period shall, in no event, end later than twenty-seven (27) months from
the Grant Date.  

  

	 	2.21	“Purchase Price” means the price designated by the Committee, at which each Share may be purchased under any option, but in no event less than eighty-five percent
(85%) of the lesser of: 

  

	 	(i)	The Grant Price, as defined in Section 2.13; and 

  

	 	(ii)	The Purchase Date Price, as defined in Section 2.18. 

  

	 	2.22	“Rule 16b-3” means Rule 16b-3 under the Exchange Act. 

  

	 	2.23	“Shares” means Shares of the Company’s common stock. 

  

	 	2.24	“Subsidiary” means any corporation in an unbroken chain of corporations beginning with the Company if, as of the applicable Enrollment Date, each of the
corporations other than the last corporation in the chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in the chain. 

  

	 	2.25	“Trading Day” means any day the stock exchange in which the Company’s Shares are traded is open for trading. 

  

 4 

 Article 3. Administration 
  
 3.1 The Plan shall be administered by the Committee. The members of the Committee shall be appointed from time to
time by, and shall serve at the discretion of the Board. The Committee shall have the authority to delegate administrative duties to officers, directors, or Employees of the Company. 
  
 3.2 The Committee shall have the power, subject to and within the limits of the express provisions of the Plan, to
construe and interpret the Plan and options granted under it; to establish, amend, and revoke rules and regulations for administration of the Plan; to determine all questions of policy and expediency that may arise in the administration of the Plan;
to make any changes to the Plan or its operations to reduce or eliminate any unfavorable accounting consequences to the extent deemed appropriate by the Committee; and, generally, to exercise such powers and perform such acts as the Committee deems
necessary or expedient to promote the best interests of the Company, including, but not limited to, designating from time to time which Affiliates of the Company shall be Participating Affiliates. The Committee’s determinations as to the
interpretation and operation of this Plan shall be final and conclusive. 
  
 In exercising the powers described in the foregoing paragraph, the Committee may adopt special or different rule, procedures, or sub-plans with respect to the Plan including, but not limited to, rules which allow
employees of any foreign Participating Affiliate to participate in, and enjoy the tax benefits offered by the Plan. 
  
 3.3 The Plan provisions relating to the administration of the Plan may be amended by the Board from time to time as may be desirable to satisfy any
requirements of or under the federal securities and/or other applicable laws of the United States, or to obtain any exemption under such laws, or to reduce or eliminate any unfavorable accounting consequences. 
  
 Article 4. Number of Shares 
  
 4.1 Shares Reserved. No more than one million (1,000,000) Shares
shall be reserved for sale and have been authorized by the stockholders of the Company for issuance pursuant to the Plan. If any option granted under the Plan shall for any reason terminate without having been exercised, the Shares not purchased
under such option shall again become available for issuance under the Plan. 
  
 4.2 Adjustments. In the event of any change in corporate capitalization such as a stock split, or a corporate transaction such as any merger, consolidation, separation, including a spin-off, or other
distribution of stock or property of the Company, any reorganization (whether or not such reorganization comes within the definition of such term in Code Section 368) or any partial or complete liquidation of the Company, the Committee may make such
adjustments it deems appropriate to prevent dilution or enlargement of rights in the number and class of Shares which may be delivered under Section 4.1, in the number, class of and/or price of Shares available for purchase under the Plan, and in
the number of Shares which a Participant is entitled to purchase. 
  

 5 

 Article 5. Eligibility Requirements 
  
 5.1 Except as provided in Section 5.2, each Employee shall become eligible to participate in the Plan in accordance
with Article 6 on the first Enrollment Date on or following the later of: (a) the date such individual becomes an Eligible Employee; or (b) the Effective Date; provided, however, that the Committee may establish administrative rules requiring that
an Employee’s employment commences some minimum period (e.g., ninety (90) days) prior to the Grant Date to be eligible to participate with respect to the Purchase Period beginning on that Grant Date. Participation in the Plan is entirely
voluntary. 
  
 5.2 Any provision of this Plan to the
contrary notwithstanding, no Employee shall be granted an option, unless their participation is required as a matter of local law or regulation: 
  

	 	(a)	If, immediately after the grant, such Employee would own, and/or hold outstanding options to purchase stock possessing five percent (5%) or more of the total combined voting power
or value of all classes of stock of the Company or of any parent or subsidiary of the Company within the meaning of Section 423 of the Code; or 

  

	 	(b)	Which permits the Employee’s rights to purchase stock under all employee stock purchase plans, as defined in Section 423 of the Code, of the Company and its subsidiaries to
accrue at a rate which exceeds twenty-five thousand dollars ($25,000) of fair market value of the stock (determined at the time such option is granted) for each calendar year in which such stock option is outstanding at any time;

  

	 	(c)	If the Employee’s customary employment does not meet certain requirements for length of employment determined by the Committee from time to time; provided, however, that any
such requirement for length of employment shall comply with Section 423 of the Code; or 

  

	 	(d)	If the Employee is prohibited by the laws of the nation of their residence of employment from participating in the Plan. 

  
 Article 6. Enrollment 
  
 Any Eligible Employee may enroll in the Plan for any future Purchase Period by completing and signing an enrollment election
form or by such other means as the Committee shall prescribe and submitting such enrollment election to the Company or a Participating Affiliate on or before the Cut-Off Date with respect to such Purchase Period. 
  

 6 

 Article 7. Grant of Options on Enrollment 
  
 7.1 Enrollment by an Eligible Employee in the Plan as of an Enrollment Date will constitute the grant by the Company
to such Participant of an option on such Enrollment Date to purchase Shares from the Company pursuant to the Plan. 
  
 7.2 An option granted to a Participant pursuant to this Plan shall expire, if not sooner terminated in accordance with the Plan, on the earliest to
occur of: (a) the end of the Purchase Period in which such option was granted; (b) the completion of the purchase of Shares under the option under Article 9; or (c) the date on which participation of such Participant in the Plan terminates for any
reason. 
  
 7.3 An option granted to a Participant under
the Plan shall give the Participant a right to purchase on a Purchase Date the number of Shares which the funds accumulated in the Participant’s Account as of such Purchase Date will purchase at the applicable Purchase Price; provided, however,
that the Committee may, in its discretion, limit the number of Shares that may be purchased by each Participant in any Purchase Period. 
  
 Notwithstanding anything to the contrary herein, no Employee shall be granted an option under the Plan (or any other plan of the Company or a Subsidiary
intended to qualify under Section 423 of the Code) which would permit the Employee to purchase Shares under the Plan (and such other plan) in any calendar year with a Fair Market Value (determined at the time such option is granted) in excess of USD
25,000. 
  
 Article 8. Payment 
  
 The Committee may designate the time and manner for payment for Shares to be
purchased during the Purchase Period, including, but not limited to, payment by each Participant in cash or by certified check on a date designated by the Committee prior to the Purchase Date, or through payroll deductions, the terms and conditions
of which are designated by the Committee. 
  
 Payment amounts
shall be credited to a Participant’s Account under this Plan. Unless required to do so by law or regulation, all payment amounts may be used by the Company for any purpose and the Company shall have no obligation to segregate funds. Unless
mandated by law or regulation, no interest shall accrue on any payments by Participants. 
  
 Article 9. Purchase of Shares 
  
 9.1 Any option held by the Participant which was granted under this Plan and which remains outstanding as of a Purchase Date shall be deemed to have been exercised on such Purchase Date for the number of Shares which the funds
accumulated in the Participant’s Account as of the Purchase Date will purchase at the applicable Purchase Price (but not in excess of the number of Shares for which options have been granted to the Participant pursuant to Section 7.3). All
other Shares for which options have been granted which are not purchased on the last Purchase Date shall terminate. 
  

 7 

 9.2 If Shares are purchased by a Participant pursuant to Section 9.1, then, within a reasonable
time after the Purchase Date, the Company shall deliver or cause to be delivered to the Participant a certificate or certificates for the whole number of Shares purchased by the Participant unless the Company has made arrangements to have the Shares
held at a bank or other appropriate institution in noncertificated form. If any law or applicable regulation of the United States Securities and Exchange Commission or other body having jurisdiction shall require that the Company or the Participant
take any action in connection with the Shares being purchased under the option, delivery of the certificate or certificates for such Shares shall be postponed until the necessary action shall have been completed. 
  
 9.3 In the case of Participants employed by a Participating Affiliate,
the Committee may provide for Shares to be sold through the Affiliate to such Participants, to the extent consistent with Section 423 of the Code and other applicable laws. 
  
 9.4 If the total number of Shares for which options are or could be exercised on any Purchase Date in accordance with
this Article 9, when aggregated with all Shares for which options have been previously exercised under this Plan, exceeds the maximum number of Shares reserved in Section 4.1, the Company shall allocate the Shares available for delivery and
distribution in the ratio that the balance in each Participant’s Account bears to the aggregate balances of all Participants’ Accounts, and the remaining balance of the amount credited to the Participant’s Account of each Participant
under the Plan shall be returned to him/her as promptly as possible. 
  
 9.5 If a Participant or former Participant sells, transfers, or otherwise makes a disposition of Shares purchased pursuant to an option granted under the Plan within two (2) years after the date such option is granted or within one
(1) year after the date such Shares were transferred to the Participant, and if such Participant or former Participant is subject to United States federal income tax, then such Participant or former Participant shall notify the Company or
Participating Affiliate in writing of such sale, transfer, or other disposition within ten (10) days of the consummation of such sale, transfer, or other disposition. 
  
 Article 10. Withdrawal From the Plan and Termination of Employment 
  
 10.1 Withdrawal from the Plan. A Participant may withdraw from the Plan in full (but not in part) during any Purchase
Period by delivering a notice of withdrawal to the Company or a Participating Affiliate (in a manner prescribed by the Committee) at any time up to but not including the fifteen (15) days prior to the Purchase Date next following the date such
notice of withdrawal is delivered, or at such shorter time in advance of such Purchase Date as the Committee may permit. 
  
 If notice of withdrawal is timely received, all funds then accumulated in the Participant’s Account shall not be used to purchase Shares as of the
next following Purchase Date, but shall instead be distributed to the Participant as soon as administratively feasible. 
  
 A Participant who has withdrawn during a Purchase Period may not return funds to the Company or a Participating Affiliate during the same Purchase Period
and require the Company or Participating Affiliate to apply those funds to the purchase of Shares. Any Eligible Employee who has withdrawn from the Plan may, however, re-enroll in the Plan on the next subsequent Enrollment Date, if any. 

 

 8 

 10.2 Termination of Employment. Participation in the Plan terminates immediately when a
Participant ceases to be employed by the Company or a Participating Affiliate for any reason whatsoever or otherwise ceases to be an Eligible Employee, and such terminated Participant’s outstanding options shall thereupon terminate. 

 
 As soon as administratively feasible after termination of participation,
the Company or Participating Affiliate shall pay to the Participant or his/her beneficiary or legal representative any amounts accumulated in the Participant’s Account at the time of termination of participation. 
  
 10.3 Change in Control. In the event of a Change in Control, the
surviving, continuing, successor, or purchasing corporation or other business entity or parent thereof, as the case may be (the “Acquiring Corporation”), may, without the consent of any Participant, assume the Company’s rights and
obligations under the Plan. If the Acquiring Corporation elects not to assume the Company’s rights and obligations under the Plan, the Purchase Date of the then current Purchase Period shall be accelerated to a date before the date of the
Change in Control specified by the Board, but the number of shares of Stock subject to outstanding Purchase Rights shall not be adjusted. All Purchase Rights which are neither assumed by the Acquiring Corporation in connection with the Change in
Control nor exercised as of the date of the Change in Control shall terminate and cease to be outstanding effective as of the date of the Change in Control. 
  
 10.4 Leave of Absence. If a Participant takes a leave of absence without terminating employment, such Participant shall have the right, at the
commencement of the leave of absence and in accordance with procedures prescribed by the Committee, to elect to withdraw from the Plan in accordance with Section 10.1. To the extent determined by the Committee or required by Section 423 of the Code,
certain leaves of absence may be treated as cessations of employment for purposes of the Plan. 
  
 Article 11. Designation of Beneficiary 
  
 The Committee may permit each Participant under the Plan, from time to time, to name any beneficiary or beneficiaries (who may be named contingently or successively) to whom the amount in his/her Participant Account
is to be paid in case of his/her death before he/she receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Committee, and will be effective only
when filed by the Participant in writing with the Committee during the Participant’s lifetime. In the absence of any such designation, any Participant Account balance remaining unpaid at the Participant’s death shall be paid to the
Participant’s estate. 
  
 Article 12. Miscellaneous 
  
 12.1 Restrictions on Transfer. Options granted under the Plan to a
Participant may not be exercised during the Participant’s lifetime other than by the Participant. Neither amounts credited to a Participant’s Account nor any rights with respect to the exercise of an option or to receive Shares under the
Plan may be assigned, transferred, pledged, or otherwise disposed of in any way by the Participant other than by will or the laws of descent and distribution. Any such attempted assignment, transfer, pledge, or other disposition shall be without
effect, except that the Committee may treat such act as an election to withdraw from the Plan in accordance with Section 10.1. 
  

 9 

 12.2 Administrative Assistance. If the Committee in its discretion so elects, it may retain a
brokerage firm, bank, or other financial institution to assist in the purchase of Shares, delivery of reports, or other administrative aspects of the Plan. If the Committee so elects, each Participant shall (unless prohibited by applicable law) be
deemed upon enrollment in the Plan to have authorized the establishment of an account on his/her behalf at such institution. Shares purchased by a Participant under the Plan shall be held in the Account. 
  
 12.3 Withholding. The Company or any Participating Affiliate shall
have the power and the right to deduct or withhold, or require a Participant to remit to the Company or any Participating Affiliate, an amount sufficient to satisfy federal, state, and local taxes, domestic or foreign, income or social insurance
required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan. 
  
 12.4 Costs. All costs and expenses incurred in administering the Plan shall be paid by the Company, except that any stamp duties, transfer taxes,
and any brokerage fees applicable to participation in the Plan may be charged to the Participant Account of such Participant by the Company. 
  
 12.5 Equal Rights and Privileges. To the extent Eligible Employees are granted options pursuant to Code Section 423, such Eligible Employees shall
have equal rights and privileges with respect to the Plan so that the Plan qualifies as an “employee stock purchase plan” within the meaning of Section 423 or any successor provision of the Code and the related regulations. 
  
 12.6 Applicable Law. The Plan shall be governed by the substantive
laws (excluding the conflict of laws rules) of the State of Delaware. 
  
 12.7 Amendment and Termination. The Board may amend, alter, suspend, or terminate the Plan at any time; provided, however, that: (a) the Plan may not be amended in a way which will cause the Plan to fail to meet the requirements of
Code Section 423; and (b) no amendment which would amend or modify the Plan in a manner requiring stockholder approval under Section 423 of the Code, Rule 16b-3, or the requirements of any securities exchange on which the Shares are traded shall be
effective unless such stockholder approval is obtained. In addition, the Committee may amend the Plan as provided in Section 3.3, subject to the conditions set forth therein and in this Section 12.7. 
  
 If the Plan is terminated or suspended, the Board or Committee may elect to
terminate all outstanding options either prior to their expiration or upon completion of the purchase of Shares on the next Purchase Date, or may elect to permit options to expire in accordance with their terms (and participation to continue through
such expiration dates). If the options are terminated prior to expiration, all funds accumulated in Participants’ Accounts as of the date the options are terminated shall be returned to the Participants as soon as administratively feasible.

  
 12.8 No Right of Employment. Neither the grant nor the
exercise of any rights to purchase Shares under this Plan nor anything in this Plan shall impose upon the Company or a Participating Affiliate any obligation to employ or continue to employ any Employee. The right of the Company or Participating
Affiliate to terminate any Employee shall not be diminished or affected because any rights to purchase Shares have been granted to such Employee. 
  

 10 

 12.9 Rights as Shareholder. No Participant shall have any rights as a shareholder unless and until
certificates for Shares of common stock have been issued to him/her. 
  
 12.10 Governmental Regulation. The Company’s obligation to sell and deliver Shares of the Company’s common stock under this Plan is subject to the approval of any governmental authority required in connection with the
authorization, issuance, or sale of such Shares. 
  
 12.11
Gender. When used herein, masculine terms shall be deemed to include the feminine, except when the context indicates to the contrary. 
  
 12.12 Condition for Participation. As a condition to participation in the Plan, Eligible Employees agree to be bound by the terms of the Plan
(including, without limitation, the notification requirements of Section 9.6) and the determinations of the Committee. 
  
 12.13 Employees Based Outside of the United States. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in
other countries in which the Company and/or its Affiliates operate or have Eligible Employees, the Committee, in its sole discretion, shall have the power and authority to: 
  

	 	(a)	Determine which Affiliates shall be covered by the Plan; 

  

	 	(b)	Modify the terms and conditions to Eligible Employees outside the United States to comply with applicable foreign laws; 

  

	 	(c)	Adopt rules or procedures relating to the operation and administration of the Plan to accommodate the specific requirements of local laws and procedures. Without limiting the
generality of the foregoing, the Committee is specifically authorized to adopt rules and procedures regarding handling of payroll deductions, payment of interest, conversion of local currency, payroll tax, withholding procedures and handling of
stock certificates which vary with local legal requirements. 

  

	 	(d)	Adopt rules, procedures or sub-plans applicable to particular Affiliates or locations, which rules, procedures or sub-plans may be designed to be outside the scope of Code Section
423. The terms of such rules, procedures or sub-plans may take precedence over other provisions of this Plan, with the exception of Article 4, but unless otherwise expressly superseded by the terms of such rule, procedure or sub-plan, the provisions
of this Plan shall govern the operation of the Plan. To the extent inconsistent with the requirements of Code Section 423, such rules, procedures or sub-plans shall be considered part of the non-423 Plan, and the options granted thereunder shall not
be considered to comply with Section 423. 

  

	 	(e)	Take any action that it deems advisable to obtain approval or comply with any necessary local government regulatory exemptions or approvals. 

  
 Notwithstanding the above, the Committee may not take any actions hereunder,
and no option shall be granted, that would violate the Exchange Act, the Code, any securities law, or governing statute or any other applicable law. 
  

 11Change Of Control Agreement

 Exhibit 10(nn) 
  
 CHANGE IN CONTROL AGREEMENT  
  
 CHANGE IN CONTROL AGREEMENT (this “Agreement”) dated as of July 12, 2004, by and between MATERIAL SCIENCES
CORPORATION, a Delaware corporation (the “Company”), and Jeffrey J. Siemers (“Employee”) (capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in Section 9 hereof).

  
 W I T N E S
S E T H: 
  
 WHEREAS, in order to
induce Employee to continue employment with, and remain in the employment of the Company, the Company and Employee desire to enter into this Agreement to provide Employee with appropriate compensation in the event of a Change in Control. 

 
 NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants
and agreements herein contained and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties, intending legally to be bound, hereby agree as follows: 
  
 1. Term of Agreement. The term of this Agreement shall commence on
the date hereof and shall terminate on June 30, 2005; provided; however, that this Agreement shall automatically renew for successive one year terms unless either party delivers written notice to the other party at least 90 days in
advance of the expiration of the initial term or the applicable renewal term, as the case may be, to the effect that such party desires to terminate this Agreement as of the last day of the initial term or applicable renewal term, as the case may
be. The Company shall not terminate Employee’s employment by the Company in connection with or in anticipation of a Change in Control. 
  
 2. Post Change in Control Employment. 
  
 (a) Commencement of Employment Period. The Company hereby employs Employee, and Employee hereby accepts such employment, effective upon the
occurrence of a Change in Control (the “Effective Date”), upon the terms and conditions hereinafter set forth. 
  
 (b) Termination of Employment Period. The term of employment under this Agreement shall terminate upon the earliest to occur of the following
events (the date of such event being referred to as the “Termination Date,” except as more particularly defined in Section 9 or 4(e)): 
  
 (i) Employee’s death; 
  
 (ii) the Company’s termination of Employee’s employment by the Company as a result of Employee’s Disability; 

 (iii) the Company’s termination of Employee’s employment by the Company for
Cause or without Cause; 
  
 (iv) Employee’s
termination of Employee’s employment by the Company for Good Reason or without Good Reason; and 
  
 (v) the date specified in Section 2(b)(v) of attached Schedule A (the period commencing on the Effective Date and ending on such
date is referred to as the “Subject Period”); provided, however, that such period of employment may be extended by written agreement of the parties (it being understood that if no such written agreement is entered into
and Employee remains employed by the Company after the completion of the Subject Period, such employment shall be “at-will” unless different terms are established in writing). 
  
 (c) Notice of Termination. Any purported termination of Employee’s employment by the Company or by Employee
shall be communicated by to the other party hereto by a written notice which shall indicate the specific termination provision of this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Employee’s employment under the provision so indicated. 
  
 (d) Compensation During Employment Period. During the Employment Period, Employee shall be entitled to the following compensation: 
  
 (i) The Company shall pay to Employee a monthly base salary in an amount which is at least equal to
Employee’s highest base monthly salary in effect during the 12-month period immediately preceding the Effective Date. 
  
 (ii) The Company shall pay to Employee an annual cash bonus (the “Required Bonus”), payable within 45 days after each
anniversary of the Effective Date, in an amount which is at least equal the greater of (A) to the highest annual bonus paid to Employee in respect of any of the three fiscal years of the Company ended immediately preceding the Effective Date and (B)
the bonus which would otherwise be required to be paid to Employee under the MIP Plan for the applicable period. 
  
 (iii) The Company shall continue to provide all employee benefit programs and fringe benefits, including, without limitation, incentive,
savings, bonus, welfare benefit, reimbursement and retirement plans and the provision of Company automobiles, and permit Employee to participate therein at rates of participation and on terms and conditions which are at least equal to the most
favorable rates of participation and terms and conditions available to Employee at any time during the 120-day period immediately preceding the Effective Date. 
  

(iv) All cash compensation payable pursuant to this Section shall be subject to all withholding and deductions required by applicable
law. 
  

 -2- 

 3. Compensation Upon Termination of Employment Period. 
  
 (a) Death. If Employee’s employment by the Company is terminated
as a result of the occurrence of Employee’s death pursuant to Section 2(b)(i), the Company shall pay to Employee’s estate the compensation and other benefits, including the bonus described in Section 2(d)(ii) pro-rated for partial years of
service, unpaid deferred compensation and vacation pay, expressly provided under this Agreement through the Termination Date, as well as any death benefits available under any Company plan or policy. 
  
 (b) Disability. If Employee’s employment by the Company is
terminated by the Company as a result of the occurrence of Employee’s Disability pursuant to Section 2(b)(ii), the Company shall pay to Employee the compensation and other benefits, including the bonus described in Section 2(d)(ii) pro-rated
for partial years of service, unpaid deferred compensation and vacation pay, expressly provided under this Agreement through the Termination Date, as well as any disability benefits available under any Company plan or policy. 
  
 (c) Termination for Cause. If Employee’s employment by the
Company is terminated by the Company for Cause pursuant to Section 2(b)(iii), the Company shall pay to Employee the compensation and other benefits, including unpaid deferred compensation and vacation pay (but excluding the bonus described in
Section 2(d)(ii)), expressly provided under this Agreement through the Termination Date. 
  
 (d) Termination without Cause. If Employee’s employment by the Company is terminated by the Company without Cause pursuant to Section 2(b)(iii), the Company shall pay to Employee (i) the compensation and
other benefits, including unpaid deferred compensation and vacation pay (but excluding the bonus described in Section 2(d)(ii)), expressly provided under this Agreement through the Termination Date and (ii) a lump sum cash payment (the
“Severance Payment”) equal to the sum of: 
  
 (A) the product of (I) the number set forth in Section 3(d)(ii)(A) of attached Schedule A multiplied by (II) the sum (y) Employee’s annual base salary in effect at the Termination Date and (z) the Highest
Annual Bonus (as hereinafter defined); 
  
 (B) an
amount (the “Highest Annual Bonus”) equal to the greater of (I) the Required Bonus and (II) the annual bonus received by Employee during the most recent fiscal year of the Company, in each case prorated to reflect the partial year
for which Employee was employed by the Company from and after the most recent anniversary of the Effective Date; 
  
 (C) the amount the Company would have been required to contribute on behalf of Employee under its defined contribution plans had Employee
remained employed by the Company in the same status after the Termination Date for the duration of the Subject Period; and 
  
 In addition, (i) the Company, at its expense, shall continue to provide Employee with all employee benefit programs (other than welfare benefit programs)
and fringe benefits specified in Section 2(d)(iii) for the duration of the Subject Period, or until Employee’s death, whichever is the shorter period; (ii) the Company, at its expense (not to exceed the amount set forth in 
  

 -3- 

 Section 3(d) of attached Schedule A), shall provide Employee with outplacement services; and (iii) all stock
options, shares of restricted stock and other stock or stock based awards granted by the Company to Employee shall become fully vested, notwithstanding the terms and conditions thereof or any plans pursuant to which such grants or awards were made
(the provisions of this paragraph are referred to as the “Other Severance Benefits”). 
  
 (e) Termination by Employee. 
  
 (i) Except as set forth in Section 3(e)(ii), if Employee’s employment by the Company is terminated by Employee without Good Reason
pursuant to Section 2(b)(iv), the Company shall pay to Employee the compensation and other benefits, including unpaid deferred compensation and vacation pay (but excluding the bonus described in Section 2(d)(ii)), expressly provided under this
Agreement through the Termination Date. 
  
 (ii)
If Employee’s employment by the Company is terminated by Employee (A) without Good Reason within 30 days after the first year anniversary of the Effective Date pursuant to Section 2(b)(iv) or (B) for Good Reason at any time from and after the
Effective Date, the Company shall pay to Employee (I) the compensation and other benefits, including unpaid deferred compensation and vacation pay (but excluding the bonus described in Section 2(d)(ii)), expressly provided under this Agreement
through the Termination Date and (II) a lump sum cash payment equal to the Severance Payment. In addition, Employee shall be entitled to the Other Severance Benefits. 
  
 4. Additional Understandings. 
  
 (a) Timing of Certain Payments. The payments provided for in Section 3 shall be made not later than the 30th day
following the Termination Date. 
  
 (b) Retirement
Benefits. In addition to all other amounts payable to Employee under Section 3, following the termination of Employee’s employment by the Company, Employee shall be entitled to receive all benefits payable to Employee under any plan or
agreement relating to retirement benefits. 
  
 (c) No
Mitigation. Employee shall not be required to mitigate the amount of any payment provided for in Section 3 by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in Section 3 be reduced by any
compensation earned by Employee as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by Employee to the Company or otherwise. 
  

 -4- 

 (d) Excise Tax Gross-Up. 
  
 (i) In the event that Employee becomes entitled to the payments and benefits provided under Section 3 above
and/or any other payments or benefits in connection with a change in control or termination of Employee’s employment with the Company (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company,
any person whose actions result in a change in control or any person affiliated with the Company or such person) (collectively, the “Payments”), if any of the Payments will be subject to the tax (the “Excise Tax”)
imposed by Section 4999 of the Code, then (A) if the aggregate amount of the Payments is equal to or greater than 330% of the “base amount” as defined in Section 280G(b)(3) of the Code, then the Company shall pay to Employee, at least 30
days prior to the time payment of any such Excise Tax is due, an additional amount (the “Gross-Up Payment”) such that the net amount retained by Employee, after deduction of any Excise Tax and any federal and state and local income
tax imposed on the Gross-Up Payment, shall be equal to the Excise Tax imposed on the Payments; and (B) if the aggregate amount of the Payments is less than 330% of the “base amount,” then the aggregate present value of the payments made
pursuant to the terms of this Agreement alone without taking into account payments made pursuant to any other agreements between the Company and Employee shall be reduced so that the Payment equals 299.99% of the “base amount” (it being
understood that in no event shall the amount of the payment made pursuant to the terms of this Agreement be less than $0). 
  
 (ii) For purposes of determining whether any of the Severance Payments will be subject to the Excise Tax and the amount of such Excise
Tax, (A) the Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(l) of the Code shall be treated as
subject to the Excise Tax, unless, in the opinion of tax counsel selected by the Company’s independent auditors and reasonably acceptable to Employee, the Payments (in whole or in part) do not constitute parachute payments or excess parachute
payments or are otherwise not subject to the Excise Tax, (B) the amount of the Payments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (y) the total amount of the Payments or (z) the amount of excess parachute
payments within the meaning of Section 280G(b)(l) (after applying clause (A) above), and (C) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Company’s independent auditors in accordance with the
principles of Section 280G(d)(3) and (4) of the Code. 
  
 (iii) For purposes of determining the amount of the Gross-Up Payment, Employee shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be
made and state and local income taxes at the highest marginal rate of taxation in the state and locality of Employee’s residence on the Termination Date, net of the maximum reduction in federal income taxes which could be obtained from
deduction of such state and local taxes. 
  

 -5- 

 (iv) In the event that the Excise Tax is subsequently determined to be less than the
amount taken into account hereunder at the time of termination of Employee’s employment, Employee shall repay to the Company at the time that the amount of such reduction in Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax imposed on the Gross-Up Payment being repaid by Employee if such repayment results in a reduction in
Excise Tax and/or a federal and state and local income tax deduction) plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to exceed the amount taken
into account hereunder at the time of the termination of Employee’s employment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional
Gross-Up Payment in respect of such excess (plus any interest payable with respect to such excess) at the time that the amount of such excess is finally determined. 
  
 (e) Company Successors. The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it
if no such succession had taken place. Failure of the Company to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Employee to compensation from the Company
in the same amount and on the same terms as Employee would be entitled to hereunder if Employee terminated Employee’s employment by the Company for Good Reason, except that for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Termination Date. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise. 
  
 (f)
No Contract of Employment. This Agreement shall not be construed as creating an express or implied contract of employment and, subject to Section 1 and except as otherwise agreed in writing between the Company and Employee, Employee shall not
have any right to be retained in the employ of the Company. 
  
 5.
Confidential Information and Ownership of Property. 
  
 (a) Confidential Information. Employee agrees to use all Confidential Information solely in connection with the performance of services for or on behalf of the Company. Employee shall not, during the term of this Agreement, or at any
time after the termination of this Agreement, in any manner, either directly or indirectly, (i) disseminate, disclose, use or communicate any Confidential Information to any person or entity, regardless of whether such Confidential Information is
considered to be confidential by third parties, or (ii) otherwise directly or indirectly misuse any Confidential Information; provided, however, that (y) none of the provisions of this Section shall apply to disclosures made for valid
business purposes of the Company or (z) that Employee shall not be obligated to treat as confidential any Confidential Information that (I) was publicly known at the time of disclosure to Employee; 
  

 -6- 

 (II) becomes publicly known or available thereafter other than by means in violation of this Agreement or any other duty
owed to the Company or any of its Affiliates by any person or entity; or (III) is lawfully disclosed to Employee by a third party. Notwithstanding the foregoing, Employee shall be permitted to disclose Confidential Information to the extent required
to enforce Employee’s rights hereunder in any litigation arising under, or pertaining to, this Agreement provided that Employee shall give prior written notice to the Company of any such disclosure so that the Company may have an opportunity to
protect the confidentiality of such Confidential Information in such litigation. 
  
 (b) Ownership of Property. Employee agrees that all works of authorship developed, authored, written, created or contributed to during the term of this Agreement for the benefit of the Company, whether solely
or jointly with others, shall be considered works-made-for-hire. Employee agrees that such works shall be the sole and exclusive property of the Company (or its appropriate Affiliate) and that all right, title and interest therein or thereto,
including all intellectual property rights existing or obtained in connection therewith, shall likewise be the sole and exclusive property of the Company (or its appropriate Affiliate). Employee agrees further that, in the event that any work is not
considered to be work-made-for-hire by operation of law, Employee will immediately, and without further compensation, assign all of Employee’s right, title and interest therein to the Company (or its designated Affiliate), its successors and
assigns. At the request and expense of the Company, Employee agrees to perform in a timely manner such further acts as may be necessary or desirable to transfer, defend or perfect the Company’s ownership of such work and all rights incident
thereto. 
  
 6. Covenant Not to Compete. Employee covenants
and agrees that Employee shall not, during the term of Employee’s employment by the Company or any Affiliate thereof and for the Non-Compete Period, directly or indirectly own an interest in, operate, join, control, advise, work for, consult
to, have a financial interest which provides any control of, or participate in any corporation, partnership, proprietorship, firm, association, person, or other entity producing, designing, providing, soliciting orders for, selling, distributing,
consulting to, or marketing or re-marketing products, goods, equipment, or services competitive with or in substantially the same line of business as the Company or any Affiliate thereof, or any part thereof, as of the commencement of the
Non-Compete Period. This prohibition applies in the territory specified in Section 6 of attached Schedule A. This covenant does not prohibit the mere ownership of less than three percent (3%) of the outstanding stock of any publicly-traded
corporation as long as Employee is not otherwise in violation of this Agreement. 
  
 7. Covenant Against Solicitation of Employees. During the term of Employee’s employment by the Company and for the Non-Compete Period, Employee shall not employ employees or agents or former employees or
agents of the Company or its Affiliates or, directly or indirectly, solicit or otherwise encourage the employment of employees or agents or former employees or agents of the Company or its Affiliates; provided, however, that this
restriction shall not apply to former employees or agents (y) who, as of the date of termination of Employee’s employment by the Company, have not worked for any of the Company or its Affiliates during the twelve preceding months or (z) whose
employment by the Company or any Affiliate thereof was terminated by the Company. 
  

 -7- 

 8. Remedies. 
  
 (a) Employee Acknowledgements. Employee acknowledges (i) that the covenants contained in Sections 5, 6 and 7,
including, without limitation, the time and geographic limits (collectively, the “Restrictive Covenants”), are reasonable and appropriate and that Employee will not any claim to the contrary in any action brought by the Company or
its Affiliates to enforce any of such provisions and (ii) that should Employee violate any of the Restrictive Covenants, it will be difficult to determine the resulting damages to the Company and its Affiliates and, in addition to any other remedies
the Company and its Affiliates may have, (A) the Company and its Affiliates shall be entitled to temporary injunctive relief without being required to post a bond and permanent injunctive relief without the necessity of proving actual damage; and
(B) the Company shall have the right to offset against its obligation to make any payments to Employee under this Agreement or otherwise to the extent of any money damages incurred or suffered by the Company and its Affiliates. The Company may elect
to seek one or more of these remedies at its sole discretion on a case by case basis. Failure to seek any or all remedies in one case shall not restrict the Company from seeking any remedies in another situation. Such action by the Company shall not
constitute a waiver of any of its rights. 
  
 (b) Intent.
It is the parties’ intent that each of the Restrictive Covenants be read and interpreted with every reasonable inference given to its enforceability. However, it is also the parties’ intent that if any term, provision or condition of the
Restrictive Covenants is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions thereof shall remain in full force and effect and shall in no way be affected, impaired or invalidated. Finally,
it is also the parties’ intent that if a court should determine any of the Restrictive Covenants are unenforceable because of over-breadth, then the court shall modify said covenant so as to make it reasonable and enforceable under the
prevailing circumstances. 
  
 (c) Tolling. In the event of
any breach by Employee of any Restrictive Covenant, the running of the period of restriction shall be automatically tolled and suspended for the duration of such breach, and shall automatically recommence when such breach is remedied in order that
the Company shall receive the full benefit of Employee’s compliance with each of the Restrictive Covenants. 
  
 (d) Independent Enforcement. Employee agrees that the Restrictive Covenants shall be enforced independently of any other obligations between the
Company, on the one hand, and Employee, on the other, and that the existence of any other claim or defense shall not affect the enforceability of the Restrictive Covenants or the remedies provided herein. The Restrictive Covenants shall be in
addition to and shall not replace any other restrictive covenant agreement that Employee may currently have (or hereafter enter into) with the Company or any of its Affiliates. 
  
 (e) Survival. The provisions of this Section 8 shall survive the termination of this Agreement. 
  

 -8- 

 9. Certain Defined Terms. For purposes of this Agreement the following terms and phrases shall
have the following meanings: 
  
 “Affiliate”
means any person or entity who or which, directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, a specified person or entity (the term “control” for these purposes meaning
the ability, whether by ownership of shares or other equity interests, by contract or otherwise, to elect a majority of the directors of a corporation, to act as or select the managing or general partner of a partnership, or otherwise to select, or
have the power to remove and then select, a majority of those persons exercising governing authority over an entity). 
  
 “Cause”, with respect to the termination of Employee’s employment by the Company, means (i) the willful and continued refusal by
Employee to perform a lawful and reasonable order, direction or instruction of the Board of Directors within a reasonable period of time after a written demand for substantial performance is delivered to Employee by the Board of Directors which
demand specifically identifies the manner in which the Board believes that Employee has not substantially performed such an order, direction or instruction; or (ii) the willful misconduct by Employee in the performance of Employee’s duties to
the Company or the willful engaging by Employee in conduct which, in either case, is illegal or materially injurious to the Company. For purposes of this definition, no act, or failure to act, on Employee’s part shall be deemed
“willful” unless done, or omitted to be done, by Employee not in good faith and without reasonable belief that Employee’s action or omission was in the best interest of the Company. In addition, notwithstanding the foregoing,
Employee’s employment by the Company shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to Employee a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters
of the entire membership of the Board of Directors at a meeting of the Board of Directors called and held for such purpose (after reasonable notice to Employee and an opportunity for Employee, together with counsel, to be heard before the Board of
Directors), finding that in the good faith opinion of the Board of Directors, Employee was guilty of conduct set forth above in clauses (i) or (ii) of the first sentence of this definition and specifying the particulars thereof in detail.

  
 “Change in Control” means the occurrence of
any one of the following events: 
  
 (i) there is
an acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the combined
voting power of the then outstanding voting securities of Material Sciences Corporation entitled to vote generally in the election of directors; 
  
 (ii) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors of
Material Sciences Corporation and any new director (other than a director designated by a person who has entered into an agreement with Material Sciences Corporation to effect a transaction described in paragraphs (i) or (iii) of this definition)
whose election by the Board of Directors of Material Sciences Corporation or nomination for election by Material Sciences Corporation’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or 
  

 -9- 

 (iii) the closing of (A) a merger or consolidation of Material Sciences Corporation with
any other entity, other than a merger or consolidation which would result in the voting securities of Material Sciences Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or through the
surviving entity) at least 50% of the combined voting power of the voting securities of Material Sciences Corporation or such surviving entity outstanding immediately after such merger or consolidation, or (B) a complete liquidation of Material
Sciences Corporation or the sale or disposition by Material Sciences Corporation of all or 80% or more of its consolidated assets. 
  
 “Code” means the Internal Revenue Code of 1986, as amended. 
  
 “Confidential Information” means all software, trade secrets, work products created by Employee for the
Company or any of its Affiliates, know-how, ideas, techniques, theories, discoveries, formulas, plans, charts, designs, drawings, lists of current or prospective clients, business plans and proposals, current or prospective business opportunities,
financial records, research and development, marketing strategies and programs and reports and other proprietary information created or obtained by Employee for the benefit of the Company or any of its Affiliates during the course of employment by
the Company. 
  
 “Disability” means the inability
of Employee to perform substantially all Employee’s duties and responsibilities to the Company by reason of a physical or mental illness or infirmity for either (i) a continuous period of six months or (ii) 180 days during any consecutive
twelve-month period. 
  
 “Employment Period”
means the date commencing on the Effective Date and terminating on the Termination Date. 
  
 “MIP Plan” means the Management Incentive Plan adopted by the Company, as the same may be amended, modified, supplemented or restated from time to time (including any successor thereto or replacement
therefor). 
  
 “Exchange Act” means the
Securities Exchange Act of 1934, as amended. 
  
 “Good
Reason” means the occurrence, without the express written consent of Employee, of any one of the following events, unless such circumstances are fully corrected prior to the Termination Date specified in the applicable notice of termination
delivered pursuant to Section 2(b): 
  
 (i) the
assignment to Employee of any duties inconsistent with Employee’s position and status with the Company as set forth on attached Schedule A or a substantial adverse alteration in the nature or status of Employee’s employment
responsibilities from those in existence on the date hereof; 
  
 (ii) the relocation of Employee’s office or job location to a location not within seventy-five miles of Employee’s present office or job location, except for required travel on the Company’s business to
an extent substantially consistent with Employee’s present business travel obligations; 
  

 -10- 

 (iii) the failure by the Company to pay to Employee any portion of the compensation
required hereunder or under any compensation plan or program of the Company, within ten business days of the date such compensation is due; 
  
 (iv) the failure of the Company to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement, as
contemplated in Section 4(e) hereof; or 
  
 (v)
any purported termination of Executive’s employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Section 2. 
  
 “Non-Compete Period” means the period commencing on the date upon which Employee ceases to be employed by the Company or any Affiliate
thereof and terminating as specified on Section 9 of attached Schedule A thereafter. 
  
 “Termination Date” means 
  
 (i) if Employee’s employment is terminated for Disability, 30 days after Notice of Termination is given (provided that Employee shall not have returned to the full-time performance of Employee’s duties
during such 30 day period); and 
  
 (ii) if
Employee’s employment is terminated pursuant to Section 2(b) for any other reason (other than death or Disability), the date specified in the Notice of Termination (which, in the case of a termination for Cause shall not be less than 30 days,
and in the case of a termination for Good Reason shall not be less than 15 nor more than 60 days, respectively, from the date such Notice of Termination is given); 
  
 provided; however, that if prior to the Termination Date (as determined without regard to this provision), the party receiving
such Notice of Termination notifies the other party that a dispute exists concerning the termination, the Termination Date shall be the date on which the dispute is finally determined, either by mutual written agreement of the parties, by a binding
arbitration award, or by a final judgment, order or decree of a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected); provided;
further, however, that the Termination Date shall be extended by a notice of dispute only if such notice is given in good faith and the party giving such notice pursues the resolution of such dispute with reasonable diligence. During
the pendency of any such dispute, the Company will continue to pay Employee’s full compensation in effect when the notice giving rise to the dispute was given (including, but not limited to, base salary) and continue Employee as a participant
in all compensation, benefit and insurance plans in which Employee was participating when the notice giving rise to the dispute was given, until the dispute is finally resolved in accordance with this definition. Amounts paid under this paragraph
are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement. 
  

 -11- 

 10. Miscellaneous. 
  
 (a) Amendment. This Agreement may be amended, modified or supplemented but only in writing signed by each of the
parties hereto. 
  
 (b) Waivers. The failure of a party
hereto at any time or times to require performance of any provision hereof shall in no manner affect its right at a later time to enforce the same. No waiver by a party of any condition or of any breach of any term, covenant, representation or
warranty contained in this Agreement shall be effective unless in writing, and no waiver in any one or more instances shall be deemed to be a further or continuing waiver of any such condition or breach in other instances or a waiver of any other
condition or breach of any other term, covenant, representation or warranty. 
  
 (c) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS. 
  
 (d) Forum Selection and Consent to Jurisdiction. EACH OF THE
COMPANY AND EMPLOYEE AGREE THAT ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT BETWEEN OR AMONG SUCH PARTIES, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF ILLINOIS LOCATED IN
COOK COUNTY, ILLINOIS, OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS. EACH OF THE COMPANY AND EMPLOYEE HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS LOCATED IN COOK
COUNTY, ILLINOIS, OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS. EACH OF THE COMPANY AND EMPLOYEE HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. 
  
 (e) Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 
  
 (f) Interpretation. The headings preceding the text of Articles and Sections included in this Agreement are for convenience only and shall not be
deemed part of this Agreement or be given any effect in interpreting this Agreement. The use of the masculine, feminine or neuter gender herein shall not limit any provision of this Agreement. The use of the terms “including” or
“include” shall in all cases herein mean “including, without limitation” or “include, without limitation,” respectively. 
  

 -12- 

 (g) Assignment. This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. No assignment of any rights or obligations shall be made by any party without the written consent of each other party. 
  
 (h) No Third Party Beneficiaries. This Agreement is solely for the benefit of the parties hereto and, to the extent
provided herein, their respective affiliates, directors, officers, employees, agents, heirs and representatives, and no provision of this Agreement shall be deemed to confer upon other third parties any remedy, claim, liability, reimbursement, cause
of action or other right. 
  
 (i) Severability. If any
provision of this Agreement shall be held invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions hereof shall not be affected thereby, and there shall be deemed substituted for the provision at issue a
valid, legal and enforceable provision as similar as possible to the provision at issue. 
  
 (j) Remedies Cumulative. The remedies provided in this Agreement shall be cumulative and shall not preclude the assertion or exercise of any other rights or remedies available by law, in equity or otherwise.

  
 (k) Entire Understanding. This Agreement, together with
attached Schedule A, sets forth the entire agreement and understanding of the parties hereto with respect to the matters set forth herein and supersedes any and all prior agreements, arrangements and understandings among the parties;
provided, however, that any agreements and understandings between the Company and Employee relating to employment and severance shall continue in full force and effect until the occurrence of a Change in Control. 
  
 (l) Conflicts With Existing Agreements. Subject to Section 10(k), in
the event that any term or provision of this Agreement conflicts with or differs from any term or provision of other existing agreement, understanding or plan (the “Existing Agreements”) between the Company and Employee or to which
Employee is a participant, such term or provision of this Agreement shall govern for all purposes and respects. Except as expressly set forth herein, this Agreement does not constitute a waiver or modification of any provision of any Existing
Agreement. Except as expressly modified hereby, the Existing Agreements shall continue in full force and effect in accordance with the provisions thereof on the date hereof. 
  
 (m) Attorneys’ Fees and Other Costs. In the event a dispute arises between the parties hereto and suit is
instituted, the prevailing party or parties in such litigation shall be entitled to recover reasonable attorneys’ fees and other costs and expenses from the non-prevailing party or parties, whether incurred at the trial level or in any
appellate proceeding. Unless Employee otherwise elects, expenses incurred by Employee in connection with any dispute described in this Section will be paid by the Company in advance of the final disposition of such dispute within 20 days after
presentation by Employee of written documentation therefor reasonably satisfactory to the Company if Employee furnishes the Company a written undertaking to repay any amounts advanced if it is ultimately determined that Employee is not entitled to
attorneys’ fees and other costs pursuant to this Section (which written undertaking will provide that the Company shall be entitled to collect its attorneys’ fees and other out-of-pocket costs incurred in connection with the enforcement of
such undertaking). 
  

 -13- 

 (n) Notices. For the purpose of this Agreement, notices and all other communications provided for
in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to (i) the Company at 2200 East Pratt Boulevard, Elk
Grove Village, Illinois 60007-5995 and (ii) Employee at the address set forth on attached Schedule A, provided that all notices to the Company shall be directed to the attention of the Board of Directors, with a copy to the Vice President
Human Resources of the Company, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change in address shall be effective only upon receipt. 
  
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the day and year first above written. 
  

			
	 THE COMPANY:

	
	 MATERIAL SCIENCES CORPORATION,
a Delaware corporation

		
	 By:
	 	 /s/ Ronald L. Stewart

	 Name:
	 	 Ronald L. Stewart

	 Title:
	 	 President and Chief Executive Officer

	
	 EMPLOYEE:

		
	 	 	 /s/ Jeffrey J. Siemers

	 	 	 Jeffrey J. Siemers

  

 -14- 

 SCHEDULE A  
 Change in Control Agreement 
  

			
	Employee Name:	  	Jeffrey J. Siemers
		
	Employee Position:	  	Vice President, Chief Financial Officer and Secretary
		
	Section 2(b)(v):	  	12 months anniversary of Effective Date (duration of Employment Period)
		
	Section 3(d)(ii)(A):	  	1.0x (applicable multiple)
		
	Section 3(d):	  	$20,000 (maximum outplacement expenses)
		
	Section 6:	  	North America, including, without limitation, Canada, the United States and Mexico (territory)
		
	Section 9:	  	1.0 year (duration of Non-Compete Period)

  

 S-1

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