Letter Agreement

Amendment 2 to Letter Agreement

Form of Change of Control Agreement

Amendment1 to form of Change of Control Agreement

 

 

1700 South Patterson Boulevard

Dayton, OH 45479

 

July 29, 2005

 

Mr. William R. Nuti

 

Dear Bill:

 

Upon execution by you, this letter will constitute your agreement (this “Agreement”) with NCR Corporation (“NCR” or the “Company”) regarding your service as the President and Chief Executive Officer (“CEO”) of the Company during the period from and after August 7, 2005 (or as soon as practicable thereafter) (the “Start Date”). The period of your employment with the Company is referred to herein as the “Engagement.”

 

Nature of the Engagement – During the Engagement, you will have the normal duties, responsibilities and authority attendant to the position of President and CEO of the Company, subject to the power of NCR’s Board of Directors (the “Board”) to expand or limit such duties, responsibilities and authority from time to time, but in all events you shall have the duties, responsibilities and authority commensurate with the position of a CEO of a public entity of similar capitalization from time to time. The Company will appoint you to serve as a member of the Board, and you agree to serve as a member of the Board for no additional compensation.

 

Annual Base Salary – As of the Start Date, you will be paid an annual base salary of $1,000,000. Your base salary will be reviewed by the Compensation and Human Resource Committee of the Board (the “Compensation Committee”) from time to time for increase, but not decrease. Your base salary will be paid in accordance with the Company’s usual payroll practices, and, if you elect, your paycheck will be automatically deposited in your bank account via our convenient Easipay plan.

 

Incentive Awards – You will be eligible to participate in the Management Incentive Plan for Executive Officers (“MIP”), which provides year-end incentive awards based on the success of NCR in meeting annual performance objectives. Your targeted incentive opportunity is 100% of your annual base salary ($1,000,000) (the “Target MIP”), and can range from 0% if the target objective is not met to a maximum award of 200% ($2,000,000) of your annual base salary. For calendar year 2005, your MIP award will be a guaranteed minimum of $500,000 (subject to upward adjustment at the discretion of the Board).


Stock Options – Effective as of the Start Date, the Company will grant you nonqualified options to purchase 650,000 shares of NCR common stock (the “Options”).

 

The Options will be subject to the existing standard terms and conditions determined by the Committee, and will include substantially identical restrictive covenants and penalty criteria as set forth in this Agreement, a ten-year term, and will vest as follows (except as described below):

 

(i) 250,000 of the Options (the “Incentive Options”) will vest in 25% increments on each of the first four anniversaries of the Start Date, subject to your continued employment with the Company on each such anniversary date, and

 

(ii) 400,000 of the Options (the “Performance Options”) have the potential to fully vest on December 31, 2008, subject to your continued employment with the Company on such date, and subject to the achievement of the performance goals set forth on Schedule A to this Agreement (the “Performance Goals”) over the 12 quarterly financial reporting periods beginning January 1, 2006 and ending December 31, 2008 (the “Performance Period”).

 

The Incentive Options shall fully vest and shall immediately become exercisable upon termination of your employment (i) due to your death or Permanent Disability (as defined below), (ii) by the Company without “Cause” (as defined in the CIC Plan) (and no provision in any equity grant or benefit program with regard to misconduct shall apply except to the extent “Cause” exists under this Agreement), (iii) by you for “Good Reason” (as defined below), or (iv) due to the failure of a successor to the Company to assume or replace the Incentive Options with equivalent value new stock options upon a Change in Control (as defined in the CIC Plan).

 

As indicated above, the Performance Options shall vest based on the extent to which the Performance Goals are met as of the end of the Performance Period, as follows (for purposes of clarity, the “Number of Performance Options Vested” below shall not be construed to be additive, and is set forth on a cumulative basis):

 

 

 

 

 

 

 

Level of Achievement of Performance Goal


  

Percentage of
Performance
Options Vested


 

 

Number of
Performance
Options
Vested


Below Threshold

  

0

%

 

0

Threshold

  

50

%

 

200,000

Target I

  

75

%

 

300,000

Target II

  

100

%

 

400,000

 

On a Change in Control (as defined in the CIC Plan), you shall be treated with regard to the Performance Options in the manner provided in the CIC Plan, but no less favorably than as provided therein as of the Start Date.

 

Once vested, the Options will be exercisable over the full ten-year term (subject to the termination provisions set forth in the terms and conditions of the Option grant); provided, however, that

 

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upon your termination of employment other than for Cause, your vested Options will remain exercisable for the lesser of (i) one year following your termination of employment or (ii) the remainder of the term of such Options.

 

The grant price of the Options will be equal to the fair market value of NCR common stock on the Start Date.

 

Salomon Smith Barney (“SSB”) is the record-keeper for NCR’s option plan, which is administered electronically. Your stock option agreement and a record of the Options will be maintained on the SSB website. You will need to accept the stock option agreement on-line before you can exercise the Options.

 

You agree to execute the Company’s standard form of stock option agreement with respect to the Options (the “Stock Option Agreements”), subject, however, to conforming the definitions of “cause” and “good reason” in the Stock Option Agreement with respect to the Incentive Options to the definitions hereunder and as otherwise provided herein.

 

Restricted Stock – Effective as of the Start Date, the Company will grant you 85,000 shares of restricted stock (the “Restricted Stock”). The Restricted Stock shall vest and any restrictions thereon shall lapse in 25% increments on each of the first four anniversaries of the Start Date; provided, however, that any unvested Restricted Stock shall fully vest and any restrictions thereon shall lapse upon termination of your employment (i) due to your death or Permanent Disability (as defined below), (ii) by the Company without “Cause” (as defined in the CIC Plan), (iii) by you for “Good Reason” (as defined below) or (iv) due to the failure of a successor to the Company to assume or replace the Restricted Stock with equivalent value new Restricted Stock upon a Change in Control (as defined below).

 

You agree to execute the Company’s standard form of restricted stock agreement with respect to the Restricted Stock (the “Restricted Stock Agreement”), subject, however, to conforming the definitions of “cause” and “good reason” in the Restricted Stock Agreement to the definitions hereunder and which Restricted Stock Agreement will include substantially identical restrictive covenants and penalty criteria as set forth in this Agreement.

 

Future Equity Awards – Subject to the provisions of this Agreement, you shall receive an additional equity award in February 2006 which is expected to have a minimum Black Scholes value of $2.5 million (the “Future Equity Award”), subject to your continued employment with the Company as of the grant date of the Future Equity Award. The Future Equity Award will be granted to you in conjunction with the Company’s normal annual grant process and will be based on an analysis of competitive data. The form and mix of the Future Equity Award will mirror the incentive structure for all senior officers of the Company and will likely include a mix of equity similar to the Restricted Stock, Incentive Options and Performance Options.

 

NCR Benefits – You will be entitled to participate in normal Company-provided benefits and perquisites at the level at least equal to other senior executive officers of the Company. As of the Start Date, you are automatically eligible for the Company’s core U.S. benefit coverage for yourself and your family, including Health Care Coverage (Cigna PPO Plan), Dental Care Coverage (Cigna Dental PPO Plan), Short-Term and Long-Term Disability Coverage, Life Insurance Coverage,

 

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and Accidental Death and Dismemberment Insurance Coverage. Additionally, you will be eligible to participate in the NCR Savings Plan (401(k)) and the NCR Employee Stock Purchase Plan. Information about each program will be provided. You may choose to waive participation in any of these plans.

 

Relocation – You will relocate to the Dayton, Ohio area as soon as practicable after the Start Date and in any event by no later than August 1, 2006. In connection with such relocation, the Company will reimburse you for all of the normal and customary relocation expenses you incur in accordance with the Company’s standard relocation policy in which you will participate. If you and your family do not relocate to the Dayton, Ohio area by August 1, 2006, this will constitute a material breach by you of the Agreement, and will be considered “Cause” for the Company to terminate your employment hereunder. Alternatively, the Company will have the option to retain your services under this Agreement, but the next applicable tranche of Restricted Stock granted to you hereunder that would have otherwise vested shall not vest and shall be forfeited to the Company. As part of your relocation expenses, the Company shall (i) pay or reimburse you for all your commuting to and from the Dayton, Ohio area on the Company airplane (provided, however, that this will not include more than one round-trip per week) and (ii) shall provide you with a $5,000 monthly allowance for your living expenses in the Dayton, Ohio area from the Start Date to the earlier of August 1, 2006 or your relocation to the Dayton, Ohio area (the “Relocation Period”) and any amounts pursuant to (i) or (ii) shall be fully grossed-up such that you will have no after tax cost.

 

Travel Expenses and Benefits – During the Engagement, NCR will permit you to use the corporate aircraft for business travel and for travel between any of your residences and the Company’s offices in Dayton, Ohio, and elsewhere as desirable. During the Relocation Period, use of the aircraft shall be covered by the prior paragraph. After the Relocation Period, you shall be permitted to use the Company’s aircraft for limited additional travel for personal use (including for security reasons) on an availability basis; provided, however, that the taxable imputed income to you attributed to such use in any calendar year, using the SIFL rates approved by the Internal Revenue Service, shall not exceed $35,000 (or such higher amount as approved by the Committee), without the prior approval of the Committee; and further provided, however, that the foregoing shall be pro-rated for calendar year 2006 after the end of the Relocation Period. The Company shall provide you a sufficient “gross-up” payment to cover all federal and Ohio state income taxes on your personal use of the corporate aircraft, payable by the Company upon notice of the payment and amount due, no later than the day such taxes are due.

 

Other Business Expenses – As a general matter, the Company will reimburse you for all reasonable expenses that you incur in the course of performing your duties under this Agreement that are consistent with the Company’s policies with respect to travel, entertainment and other business expenses. Reimbursement shall be subject to the Company’s customary requirements imposed upon executive level employees, with respect to reporting and documentation of such expenses.

 

Vacation – You will be eligible for five weeks of paid vacation during each calendar year of the Engagement (pro-rated for 2005 based on the Start Date).

 

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Change in Control – You will be entitled to participate in the CIC Plan effective as of the Start Date.

 

Severance – In the event of a Company initiated termination of your employment other than for “Cause” (as defined in the CIC Plan), or a voluntary termination for “Good Reason” (as defined below) you will receive cash severance payments totaling (x) one and one half (1.5) times your annual base salary and Target MIP (the “Severance Benefit”), payable in equal monthly installments, the number of which will be determined so that you receive the full Severance Benefit no later than two and one-half months after the start of the calendar year following the calendar year during which your termination of employment occurs, and (y) a pro-rated MIP, based on the achievement of applicable performance targets pursuant to the MIP for the year of your termination, and based on the number of days you are employed during the year of the termination of employment, payable when the MIP is otherwise payable by the Company, but in no event later than two and one-half months after the start of the calendar year following the calendar year during which your termination of employment occurs; provided, that you execute a release of claims substantially in the form attached as Schedule C hereto, with such changes as are necessary or appropriate to account for changes in law or regulation. In addition, during the 18-month period following your termination of employment other than for “Cause” or for “Good Reason” (if you are not otherwise employed during such period and covered under the group medical plan provided to employees of such subsequent employer), the Company agrees, if you so elect, that the Company will continue your (including your dependents) medical benefits under COBRA, to the same extent as during your employment, with your COBRA premiums paid by the Company.

 

The Company agrees to cooperate with you to amend this Agreement to the extent you deem necessary to avoid imposition of any additional tax under Section 409A of the Internal Revenue Code (and any Department of Treasury regulations promulgated thereunder), but only to the extent such amendment would not have a more than de minimis adverse effect on the Company.

 

Non-Competition – By signing this Agreement, you agree that during your employment with NCR and for an eighteen (18) month period after termination of employment for any reason (the “Restricted Period”), you will not yourself or through others, without the prior written consent of the Board, render services directly or indirectly to any Competing Organization involving the development, manufacture, marketing, advertising or services of any product, process, system or service of NCR’s during the last three years of your NCR employment.

 

For purposes of this Agreement, “Competing Organization” means any organization listed on Schedule B, as reasonably amended from time to time by the Compensation Committee, in consultation with you, as well as any subsidiaries of such companies that become stand-alone companies as a result of a spin-off, IPO or similar restructuring transaction after the date of the last update to Schedule B. The list of Competing Organizations on Schedule B hereto may be amended from time to time by the Compensation Committee by written notice to you, provided that (i) the number of companies shall not increase, (ii) any companies shall be from among those entities treated as “Competing Organizations” on the annual list prepared jointly by you and the Compensation Committee pursuant to the Company’s policies and (iii) the list of Competing Organizations shall not be changed in contemplation of your accepting an offer to join any company.

 

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Non-Solicitation/Non-Hire – By signing this Agreement, you agree that during the Restricted Period, you will not yourself or through others, without the prior written consent of the Board (i) directly or indirectly recruit, hire, solicit or induce, or attempt to induce, any exempt employee of NCR or its associated companies to terminate their employment with or otherwise cease their relationship with NCR or its associated companies (provided that you may serve as reference upon request with regard to a company with which you are not affiliated and this provision shall not be violated by general advertising not specifically targeted at employees of the Company), or (ii) canvass or solicit business of the same nature that NCR or its associated companies is selling or providing to any firm or company as of the date of your termination of employment with or from such particular firm or company.

 

Confidentiality and Non-Disclosure – You agree that during the term of your employment with the Company and thereafter, you will not, except as you deem necessary in good faith discretion to perform your duties hereunder or as required by applicable law, disclose to others or use, whether directly or indirectly, any Confidential Information regarding the Company. “Confidential Information” shall mean information about the Company, its subsidiaries and affiliates, and their respective clients and customers that is not available to the general public or generally known in the industry and that was learned by you in the course of your employment by the Company, including (without limitation) (i) any proprietary knowledge, trade secrets, ideas, processes, formulas, cell lines, sequences, developments, designs, assays and techniques, data, formulae, and client and customer lists and all papers, resumes, records (including computer records), (ii) information regarding plans for research, development, new products, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, suppliers and customers, (iii) information regarding the skills and compensation of other employees of Company and (iv) the documents containing such Confidential Information; provided, however, that any provision in any grant or agreement that limits confidential disclosure shall not apply to the extent such information is publicly filed with the Securities and Exchange Commission (the “SEC”). Your rolodex and similar address books shall not be deemed Confidential Information if and to the extent they contain only the names and contact information you have personally used while employed (or acquired prior to employment hereunder) and no other information that would otherwise be Confidential Information. You acknowledge that such Confidential Information is specialized, unique in nature and of great value to the Company, and that such information gives the Company a competitive advantage. Upon the termination of your employment for any reason whatsoever, you shall promptly deliver to the Company all documents, slides, computer tapes and disks (and all copies thereof) containing any Confidential Information.

 

Breach of Restrictive Covenants – You acknowledge and agree that the time, territory and scope of the post-employment restrictive covenants in this Agreement (the non-competition, non-solicitation, non-hire, confidentiality and non-disclosure covenants are hereby collectively referred to as the “Restrictive Covenants”) are reasonable and necessary for protection of the Company’s legitimate business interests, and you agree not to challenge the reasonableness of such restrictions. You acknowledge that you have been represented by counsel in this matter, and have had a full and fair opportunity to consider these restrictions prior to your execution of this Agreement. You further acknowledge and agree that you have received sufficient and valuable consideration in exchange for your agreement to the Restrictive Covenants, including but not limited to your salary, equity awards and benefits under this Agreement, the possibility of

 

6


“Severance” under this Agreement and all other consideration provided to you under this Agreement. Accordingly, if you materially breach any of the Restrictive Covenants, NCR will be released from all obligations it may have under this Agreement to provide you with “Severance.”

 

You further acknowledge and agree that if you breach the Restrictive Covenants, NCR will sustain irreparable injury and may not have an adequate remedy at law. As a result, you agree that in the event of your breach of any of the Restrictive Covenants, NCR may, in addition to its other remedies, bring an action or actions for injunction, specific performance, or both, and have entered a temporary restraining order, preliminary or permanent injunction, or order compelling specific performance.

 

Arbitration – Any controversy or claim related in any way to this Agreement (including, but not limited to, any claim of fraud or misrepresentation or any claim with regard to the CIC Plan), shall be resolved by arbitration on a de novo standard pursuant to this paragraph and the then current rules of the American Arbitration Association. The arbitration shall be held in Dayton, Ohio, before an arbitrator who is an attorney knowledgeable of employment law. The arbitrator’s decision and award shall be final and binding and may be entered in any court having jurisdiction thereof. The arbitrator shall not have the power to award punitive or exemplary damages. Issues of arbitrability shall be determined in accordance with the federal substantive and procedural laws relating to arbitration; all other aspects shall be interpreted in accordance with the laws of the State of Ohio. Each party shall bear its own attorneys’ fees associated with the arbitration and other costs and expenses of the arbitration shall be borne as provided by the rules of the American Arbitration Association; provided, however, that if you are the prevailing party, you shall be entitled to reimbursement for reasonable attorneys’ fees and expenses and arbitration expenses incurred in connection with the dispute. If any portion of this paragraph is held to be unenforceable, it shall be severed and shall not affect either the duty to arbitrate or any other part of this paragraph.

 

Legal Expenses – The Company will pay up to $25,000 for the reasonable legal advice expenses you incur in connection with the completion of this Agreement.

 

Defined Terms – For purposes of this Agreement, “Good Reason” shall be defined as defined in the CIC Plan, but shall also include (i) a diminution in your job title (other than temporarily while you are incapacitated); (ii) a material diminution or adverse change (other than temporarily while you are incapacitated) in your position, office or duties (including your removal from or non-re-election to the Board); or (iii) a material breach of this Agreement by the Company, which remains uncured, if curable, after more than ten (10) days after your providing written notice of such breach to the Company.

 

For purposes of this Agreement, “Permanent Disability” shall mean your absence from your duties with the Company on a full-time basis for 120 consecutive business days or 180 business days in any 12-month period as a result of your incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and which physician is acceptable to you or your legal representative.

 

Miscellaneous – This Agreement is personal to you and without the prior written consent of the Company shall not be assignable by you other than by will or the laws of descent and distribution.

 

7


You may designate one or more beneficiaries to whom any payments earned by and due to you will be made in the event of your death by completing such form as the Board or one of its committees authorizes for that purpose. In the absence of any such designation, any such payments will be made to your estate or personal representative. This Agreement shall inure to the benefit of and be enforceable by your legal representatives, and shall inure to the benefit of and be binding upon the Company and its successors; provided, however, that the Company may only assign this Agreement to an acquirer of all or substantially all of its assets and any such acquirer shall be required to deliver to you an assumption in writing of the Company’s obligations hereunder. This Agreement may be amended, modified or changed only by a written instrument executed by you and the Company.

 

You hereby represent and warrant to the Company that you are not party to any contract, understanding, agreement or policy, whether or not written, with any previous employer or otherwise, that would be breached by your entering into, or performing services under, this Agreement, or, if you are a party to such a contract, understanding, agreement or policy, you shall have obtained a written acknowledgement from your previous employer (or such other party or parties) such that your performance of services under this Agreement shall not be impeded in any manner (other than confidentiality, nonsolicitation and noninterference restrictions all as provided in your employment agreement with your prior employer), or otherwise be subject to any claim, action or litigation by your previous employer (or any other party or parties).

 

The Company hereby represents and warrants to you that the Company’s financial statements for 2003, 2004 and the quarters ending March 31 and June 30, 2005 that have been or, with regard to the June 30, 2005, quarter will be filed with the SEC are accurate in all material respects.

 

No provision of any restrictive covenant in any grant or other plan shall be any broader than those set forth in this Agreement.

 

Notwithstanding any other provision of this Agreement, the Company may withhold from any amounts payable hereunder, or any other benefits received pursuant hereto, such minimum federal, state and/or local taxes as shall be required to be withheld under any applicable law or regulation.

 

This Agreement reflects the entire agreement regarding the terms and conditions of your employment. Accordingly, it supersedes and completely replaces any prior oral or written communication on this subject. This Agreement is not an employment contract, and should not be construed or interpreted as containing any guarantee of continued employment or employment for a specific term. The employment relationship at NCR is by mutual consent (employment-at-will), and the Board or you may discontinue your employment with or without cause at any time and for any reason or no reason.

 

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Bill, if you will please countersign a copy of this letter agreement, it will constitute the terms of your service as President and CEO of the Company upon the terms and conditions described above.

 

Sincerely,

 

 

 

/s/ Linda Fayne Levinson

Linda Fayne Levinson

Chair, NCR Compensation and Human Resource Committee

 

Agreed and accepted this 29 day of July, 2005.

 

/s/ William R. Nuti

William R. Nuti

 

9

 

 

 

LETTER AGREEMENT DATED JULY 26, 2006 WITH WILLIAM R. NUTI

Exhibit 10.4

LOGO

 


 

 

 

 

 

  

1700 S. Patterson Boulevard

 

  

Dayton, OH 45479-0001

July 26, 2006

Mr. William R. Nuti

NCR Corporation

1700 South Patterson Boulevard

Dayton, OH 45479

Dear Mr. Nuti:

This will confirm that the paragraph captioned “Relocation” of the letter agreement between us dated July 29, 2005 is amended to: (a) delete the first four sentences and the first six words of the fifth sentence; (b) to substitute “NCR” for the words “the Company” at the beginning of the fifth sentence as amended by clause (a) hereof; and (c) to delete the words beginning with “from” and ending with “(the Relocation Period)” in clause (ii) of the fifth sentence. In addition, the paragraph captioned “Travel Expenses and Benefits” of such letter agreement is amended to: (w) insert the words “, subject to the terms of the prior paragraph,” after the first use of the word “and” in the first sentence of such paragraph; (x) delete the second sentence and the first four words of the third sentence of such paragraph; (y) capitalize the first use of the word “you” in the third sentence; and (z) delete the words following the second semicolon in the third sentence of such paragraph.

 

 

Sincerely,

 

NCR Corporation

 

/s/ Linda Fayne Levinson

Linda Fayne Levinson

Chair, NCR Compensation and Human Resource Committee

 

 

Agreed and accepted

 

This 26th day of July 2006

 

/s/ William R. Nuti

William R. Nuti

 

TOP OF PAGE

 

EXHIBIT 10.30.2

This memorializes an agreement reached between William Nuti

and NCR Corporation on December 12, 2008

December 18, 2008

Mr. William Nuti

NCR Corporation

1700 South Patterson Boulevard

Dayton, Ohio 45479

Dear Mr. Nuti:

This letter agreement documents the changes that constitute the second amendment (the “Second Amendment”) to the letter agreement between us dated July 29, 2008, as amended July 26, 2006 (the “Agreement”). This Second Amendment amends the Agreement as described below. All provisions of the Agreement not modified herein shall remain in full force and effect, except as the Compensation and Human Resource Committee of the NCR Corporation Board of Directors (the “Committee”) has otherwise modified as documented in the minutes of the Committee.

1. The first reference to “CIC Plan” in the fifth paragraph of the section captioned “Stock Options” shall be deleted in its entirety and the following shall be substituted in lieu thereof: “NCR Change-in-Control Severance Plan for Executive Officers as in effect on the Start Date (the “CIC Plan”).”

2. The section captioned “Relocation” shall be deleted in its entirety.

3. The section captioned “Travel Expenses and Benefits” shall be amended as follows:

 

 

a.

The first reference to “and,” in the first sentence of the section shall be deleted in its entirety and the following shall be substituted in lieu thereof: “, including”.

 

 

b.

The following shall be added at the end of the last sentence in the section: “; provided, however, effective January 1, 2008, the Company will no longer provide a gross up payment to cover any taxes related to your personal use of the corporate aircraft”.

4. The section captioned “Change in Control” shall be deleted in its entirety and the following shall be substituted in lieu thereof:

Change in Control – You will be entitled to participate in the Amended and Restated NCR Change in Control Severance Plan (or any successor plan if you elect to so participate)(the “Restated CIC Plan”), provided that no restrictions on your activities thereunder shall be any broader than as provided herein and

 

1


further provided that, if you are entitled to payment under the Restated CIC Plan as a result of the proviso in Section 4.1 thereof, you shall receive the annual incentive award under Section 4.2(b)(ii) thereof at the time you would have received the amount that would be due under (iv) of the section below entitled “Severance” (had your employment terminated under circumstances entitling you to severance benefits under that section of this Agreement), provided that the amount, if any, due thereunder in excess of the amount due hereunder shall not be paid until at least six (6) months after your “separation from service” (within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code)).

5. The section captioned “Severance” shall be deleted in its entirety and replaced with the following:

Severance – In the event of your “separation from service” (within the meaning of Section 409A of the Code) due to termination by the Company other than for “Cause” (as defined in the CIC Plan), or your voluntary termination for “Good Reason” (as defined below) you will be entitled to receive the following:

(i) Any unpaid base salary through the date of your termination, payable in accordance with the Company’s usual payroll practices.

(ii) The amount of any unpaid annual bonus under the MIP for any performance period completed prior to your termination, payable when the MIP is otherwise payable by the Company, but in no event later than two and one-half months after the end of the completed performance period.

(iii) A lump sum cash severance payment equal to one and one half (1.5) times your annual base salary and Target MIP (the “Severance Benefit”), payable on the first business day after the date that is six (6) months after your “separation from service” (within the meaning of Section 409A of the Code), together with interest from the date of separation from service to the date of payment at the applicable federal rate under Section 7872(f)(2)(A) of the Code in effect on the date of your separation from service. As used in this paragraph, “Target MIP” shall mean the target levels for the applicable year under the “Management Incentive Objectives” (or any successor objectives) the Compensation Committee may set in its exercise of downward discretion as provided in the MIP.

(iv) An annual incentive under the MIP, based on the achievement of applicable performance targets pursuant to the MIP for the year of your termination and taking into account the discretionary downward adjustments applicable to all senior executives in the MIP who did not terminate employment, pro-rated based on the number of days you are employed during the year of the termination of employment, payable when the MIP is otherwise

 

2


payable by the Company, but in no event later than two and one-half months after the start of the calendar year following the calendar year during which your termination of employment occurs (the “Pro-Rated MIP”). Upon payment of the Pro-Rated MIP, the Company shall have no further obligation to make any payment to you under the MIP for the year of termination.

(v) During the 18-month period following your “separation from service” (within the meaning of Section 409A of the Code) (if you are not otherwise employed during such period and covered under the group medical plan provided to employees of such subsequent employer), the Company agrees, if you so elect, that the Company will continue your (including your dependents) medical benefits under COBRA, to the same extent as during your employment, with your COBRA premiums paid by the Company.

Notwithstanding the foregoing, the Severance Benefit and the Pro-Rated MIP will only be paid to you if, within sixty (60) days after your “separation from service” (within the meaning of Section 409A of the Code), you execute a release of claims substantially in the form attached as Schedule C hereto, with such changes as are necessary or appropriate to account for changes in law or regulation and the release has become effective and irrevocable in accordance with its terms (taking into account any applicable revocation period set forth therein).

The Company agrees to cooperate with you to amend this Agreement to the extent you deem necessary to avoid imposition of any additional tax under Section 409A of the Code (and any Department of Treasury regulations promulgated thereunder), but only to the extent such amendment would not have a more than de minimis adverse effect on the Company.

6. Clause (i) of the second sentence of the second paragraph in the section captioned “Non-Competition” shall be deleted in its entirety and the following shall be substituted in lieu thereof: “(i) the number of companies shall not increase above the number of companies listed on Schedule B, as amended by the Second Amendment to this Agreement; provided, however, that subject to your consent, which will not be unreasonably withheld, the number of companies may be increased to no more than twelve in total”.

7. The section captioned “Arbitration” shall be amended as follows:

a. The following shall be added following the first reference to “CIC Plan”: “(or any successor plan”.

b. The following shall be added at the end of the sixth sentence: “at any time from the Start Date through your remaining lifetime (or, if longer, through the twentieth (20th) anniversary of the Start Date). To the extent that the reimbursement for reasonable attorneys’ fees and expenses and arbitration expenses is considered “deferred compensation” within the meaning

 

3


of Section 409A of the Code, then the reimbursement must be paid promptly, but no later than March 15 of the year following the calendar year in which you are declared the prevailing party, as determined by a ruling by the arbitrator.”

8. The section captioned “Legal Expenses” shall be amended to read in its entirety as follows: “The Company will reimburse you up to $15,000 for the reasonable legal advice expenses you incur in 2008 in connection with the amendment of this Agreement.”

9. The following section shall be added following the section captioned “Defined Terms”:

Section 409A – It is intended that the payments and benefits provided to you under this Agreement and the Restated CIC Plan shall either be exempt from the application of, or comply with, the requirements of Section 409A of the Code. This Agreement and the Restated CIC Plan shall be construed, administered, and governed in a manner that effects such intent. In particular, and without limiting the foregoing, any reimbursements or in-kind benefits provided under this Agreement that are taxable benefits (and that are not disability pay or death benefit plans within the meaning of Section 409A of the Code) shall be subject to the following rules: (i) any such reimbursements shall be paid no later than the end of the calendar year next following the calendar year in which the you incur the reimbursable expenses, (ii) the amount of reimbursable expenses and in-kind benefits that NCR is obligated to pay or provide in any given calendar year shall not affect the reimbursable expenses or in-kind benefits that NCR is obligated to pay or provide in any other calendar year, and (iii) your right to have NCR reimburse expenses and provide in-kind benefits may not be liquidated or exchanged for any other benefit. Further, any tax gross-up payment that NCR is obligated to provide under this Agreement shall be paid or reimbursed no later than the end of the calendar year following the calendar year in which the applicable taxes are remitted. Further, to the extent that any deferred compensation (within the meaning of Section 409A of the Code) is payable by the Company pursuant to this Agreement or the Restated CIC Plan during a designated period, you shall not have any right to designate the taxable year of payment of such deferred compensation.

10. The reference to “written communication” in the seventh paragraph of the section captioned “Miscellaneous” shall be deleted in its entirety and the following shall be substituted in lieu thereof: “written negotiations or other communication”.

11. The following sentence shall be added immediately following the second sentence in the seventh paragraph of the section captioned “Miscellaneous”: “Prior drafts of this Agreement or of any amendment hereto shall not be construed against either party to this Agreement.”

 

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12. Schedule B, as attached to the Agreement, shall be deleted in its entirety and replaced with Schedule B attached hereto.

Sincerely,

NCR Corporation

 

By:

 

/s/ Andrea Ledford

Name:

 

Andrea Ledford

Title:

 

Senior Vice President, Human Resources

 

Signed on January 22, 2009, as of December 12, 2008

Agreed and Accepted

January 21, 2009, as of December 12, 2008

 

/s/ William R. Nuti

William R. Nuti

 

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Top of the Document

EX-10.1 2 dex101.htm NCR CHANGE IN CONTROL SEVERANCE PLAN

Exhibit 10.1

 

NCR Change in Control Severance Plan

 

Introduction

 

The Board of Directors of NCR Corporation (the “Company”) recognizes that, from time to time, the Company may explore potential transactions that could result in a Change in Control of the Company. This possibility and the uncertainty it creates may result in the loss or distraction of certain key employees of the Company to the detriment of the Company and its shareholders.

 

The Board considers the avoidance of such loss and distraction to be essential to protecting and enhancing the best interests of the Company and its shareholders. The Board also believes that when a Change in Control is perceived as imminent, or is occurring, the Board should be able to receive and rely on disinterested service from employees regarding the best interests of the Company and its shareholders without concern that employees might be distracted or concerned by the personal uncertainties and risks created by the perception of an imminent or occurring Change in Control.

 

In addition, the Board believes that it is consistent with the Company’s employment practices and policies and in the best interests of the Company and its shareholders to treat fairly its employees whose employment terminates in connection with or following a Change in Control.

 

Accordingly, the Board has determined that appropriate steps should be taken to assure the Company of the continued employment and attention and dedication to duty of its employees and to seek to ensure the availability of their continued service, notwithstanding the possibility or occurrence of a Change in Control.

 

Therefore, in order to fulfill the above purposes, the Board has caused the Company to adopt this NCR Change in Control Severance Plan (the “Plan”).

 

The Plan is intended to comply with the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and other applicable laws.

 

The Plan is a sub-plan of the NCR Workforce Redeployment Plan, which is a component of the NCR Group Benefits Plan for Active Associates, plan number 502. To the extent the separation pay portion of the plan is a pension plan, it qualifies for exemption from Parts II, III and IV of ERISA as a plan maintained primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees under Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

 

ARTICLE I

ESTABLISHMENT OF PLAN

 

As of the Effective Date, the Company hereby establishes the NCR Corporation Change in Control Severance Plan, as set forth in this document.


ARTICLE II

DEFINITIONS

 

As used herein, the following words and phrases shall have the following respective meanings:

 

(a) Base Salary. The amount a Participant is entitled to receive as wages or salary on an annualized basis, excluding all bonus, overtime, health additive and incentive compensation, payable by the Company as consideration for the Participant’s services.

 

(b) Board. The Board of Directors of NCR Corporation.

 

(c) Cause. A termination for “Cause” shall have occurred where a Participant is terminated because of (A) the willful and continued failure of the Participant to perform substantially the Participant’s duties with the Company or any of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness) for a period of at least thirty (30) days after a written demand for substantial performance is delivered to the Participant by the Board or the Chief Executive Officer of the Company, specifically identifying the manner in which the Board or the Chief Executive Officer believes that the Participant has not substantially performed the Participant’s duties; or (B) the willful engaging by the Participant in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company. For purposes of this provision, no act or failure to act, on the part of the Participant, shall be considered “willful” unless it is done, or omitted to be done, by the Participant in bad faith or without reasonable belief that the Participant’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer (except if the Participant is the Chief Executive Officer) or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company. The termination of employment of the Participant shall not be deemed to be for Cause unless and until there shall have been delivered to the Participant a copy of a resolution duly adopted by the affirmative vote of a majority of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Participant and the Participant is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Participant is guilty of the conduct described in subsection (A) or (B) above, and specifying the particulars thereof in detail.

 

(d) Change in Control. The occurrence of any of the following events:

 

(i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of thirty percent (30%) or more of either (a) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (b) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for

 

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purposes of this subsection (i), the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (d) any acquisition pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of this Section 2(c); or

 

(ii) Individuals who, as of the date of this Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date of this Plan whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least two-thirds (2/3) of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

 

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another entity (a “Corporate Transaction”), in each case, unless, following such Corporate Transaction, (A) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction beneficially own, directly or indirectly, more than fifty percent (50%) of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a 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 Corporate Transaction of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; (B) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Corporate Transaction) beneficially owns, directly or indirectly, thirty percent (30%) or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Corporate Transaction; and (C) at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Corporate Transaction; or

 

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

 

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(e) Code. The Internal Revenue Code of 1986, as amended from time to time.

 

(f) Company. NCR Corporation and any successor thereto.

 

(g) Compensation Committee. The Compensation and Human Resource Committee of the Board.

 

(h) Date of Termination. As defined in Section 4.2(a).

 

(i) Disability. The absence of the Participant from the Participant’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Participant or the Participant’s legal representative.

 

(j) Effective Date. January 1, 2006.

 

(k) Employee. Any regular, full-time or part-time employee of the Company or its subsidiaries.

 

(l) Good Reason. With respect to any Participant, the occurrence of any of the following events without the Participant’s prior written consent:

 

(i) the assignment to the Participant of any duties inconsistent in any respect with the Participant’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, as in effect immediately prior to a Change in Control or any other diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Participant, provided that, with the exception of the Participant who is the Chief Executive Officer of the Company immediately prior to the Change in Control, a change in the individual(s) or position(s) to whom the Participant reports shall not by itself constitute Good Reason;

 

(ii) any reduction in the Participant’s Base Salary below the Required Base Salary,

 

(iii) the failure to pay incentive compensation to which the Participant is otherwise entitled under the terms of the Company’s Management Incentive Plan for Executive Officers (“MIP”) or Long Term Incentive Program (“LTIP”), or any successor incentive compensation plans, at the time at which such awards are usually paid or as soon thereafter as administratively feasible;

 

(iv) the reduction in Target Bonus or Maximum Bonus for a Participant under the MIP or any successor plan or the reduction in any LTIP Target Award or LTIP Maximum Award under the LTIP or any successor incentive compensation plan, other than in the case of a reduction in any LTIP Target Award or LTIP Maximum Award, such reduction is pursuant to an across-the-board reduction applicable to similarly situated executives of the Company;

 

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(v) the failure by the Company to continue in effect any equity compensation plan in which the Participant participates immediately prior to the Change in Control, unless a substantially equivalent alternative compensation arrangement (embodied in an ongoing substitute or alternative plan) has been provided to the Participant, or the failure by the Company to continue the Participant’s participation in any such equity compensation plan on substantially the same basis, in terms of the level of such Participant’s participation relative to other participants, as existed immediately prior to the Change in Control excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Participant;

 

(vi) Except as required by law, the failure by the Company to continue to provide to the Participant employee benefits substantially equivalent, in the aggregate, to those enjoyed by the Participant under the qualified and nonqualified employee benefit and welfare plans of the Company, including, without limitation, the pension, life insurance, medical, dental, health and accident, disability retirement, and savings plans, in which the Participant was eligible to participate immediately prior to the Change in Control, or the failure by the Company to provide the Participant with the number of paid vacation days to which such Participant is entitled under the Company’s vacation policy immediately prior to the Change in Control;

 

(vii) the Company’s requiring the Participant to be based at any office or location other than the principal place of the Participant’s employment in effect immediately prior to the Change in Control that is more than forty (40) miles distant from the location of such principal place of employment, or the Company’s requiring the Participant to travel on Company business to a substantially greater extent than required immediately prior to the Change in Control; or

 

(viii) any failure by the Company to comply with Article V.

 

(m) LTIP Maximum Award. With respect to any Participant, the higher of (x) the Participant’s maximum award under the LTIP or any successor plan for the year immediately prior to the Change in Control, provided that if no maximum award has been established for such year under such plan, the most recent year preceding the Change in Control in which such an award has been established or (y) the Participant’s maximum award under the LTIP or any successor plan in effect at any time after the Change in Control.

 

(n) LTIP Target Award. With respect to any Participant, the higher of (x) the Participant’s target award under the LTIP or any successor plan for the year immediately prior to the Change in Control, provided that if no target award has been established for such year under such plan, the most recent year preceding the Change in Control in which such an award has been established or (y) the Participant’s target award under the LTIP or any successor plan in effect at any time after the Change in Control.

 

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(o) Maximum Bonus. With respect to any Participant, the higher of (x) the Participant’s maximum bonus under the annual bonus plan applicable to the Participant immediately prior to the Change in Control, provided that if no maximum bonus has been established for such year under such plan, the year immediately preceding the year in which the Change in Control occurs or (y) the Participant’s maximum bonus under the annual bonus plan applicable to the Participant in effect at any time after the Change in Control

 

(p) Participant. An Employee who meets the eligibility requirements of Section 3.1.

 

(q) Plan. The NCR Corporation Change in Control Severance Plan.

 

(r) Plan Committee. The committee which shall have full power and authority to administer the Plan and may delegate to one or more officers and/or employees of the Company such duties in connection with the administration of the Plan as it may deem necessary, advisable or appropriate. Prior to a Change in Control, the Plan Committee shall consist of the members of the Compensation Committee; provided, however, that any time prior to a Change in Control, the Plan Committee may designate Incumbent Board members or individuals who were officers of the Company as of immediately prior to the Change in Control (“Incumbent Members”) to serve as the Plan Committee following the Change in Control. Once designated by the Plan Committee prior to a Change in Control to serve following a Change in Control, Incumbent Members may not be removed from the Plan Committee following the Change in Control.

 

(s) Required Base Salary. With respect to any Participant, the higher of (x) the Participant’s Base Salary as in effect immediately prior to the Change in Control and (y) the Participant’s highest Base Salary in effect at any time thereafter.

 

(t) Separation Benefit. The benefits payable in accordance with Section 4.2 of the Plan.

 

(u) Target Bonus. With respect to any Participant, the higher of (x) the Participant’s target bonus under the annual bonus plan applicable to the Participant immediately prior to the Change in Control, provided that if no target bonus has been established for such year under such plans, the year immediately preceding the year in which the Change in Control occurs or (y) the Participant’s target bonus under the annual bonus plan applicable to the Participant in effect at any time after the Change in Control.

 

(v) Tier Level. As defined in Section 3.1.

 

ARTICLE III

ELIGIBILITY

 

3.1 Participation. Each Employee who is designated by the Board as a “Section 16 officer” shall be eligible to be a Participant in the Plan. The Plan Committee may also designate any other Employee as a Participant. In the event the Plan Committee designates certain Participants by job title, position, function or responsibilities, an Employee who is appointed to such a position after the Effective Date of this Plan shall be eligible as a Participant upon the

 

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date he or she begins his or her duties in such position, unless otherwise determined by the Plan Committee. The Plan Committee shall designate each Participant in the Plan as a member of a specific tier for the purposes of calculating the Participants’ Separation Benefit under this Plan (“Tier Level”). Exhibit A, attached hereto and made a part hereof, sets forth the initial Participants and their respective Tier Levels, which may be amended from time to time in accordance with the terms of the Plan.

 

3.2 Duration of Participation. Subject to Article VI, an Employee shall cease to be a Participant in the Plan when he or she (i) ceases to be an Employee or (ii) ceases to be designated by the Board as a “Section 16 officer” or (iii) ceases to be designated by the Board as a Participant (unless, in the case of clause (ii), the Plan Committee specifically determines that the Employee shall remain a Participant). Notwithstanding the foregoing, a Participant who is entitled, as a result of ceasing to be an Employee under the circumstances set forth in Section 4.1, to payment of a Separation Benefit or any other amounts under the Plan shall remain a Participant in the Plan until the full amount of the Separation Benefit and any other amounts payable under the Plan have been paid to the Participant.

 

ARTICLE IV

SEPARATION BENEFITS

 

4.1 Right to Separation Benefit. Except as otherwise provided in Section 4.4 with respect to the benefits thereunder, which shall be provided regardless of whether a Participant incurs a termination of employment, a Participant shall be entitled to receive from the Company a Separation Benefit in the amount provided in Section 4.2 if, within the two year period following the Change in Control, (i) a Participant’s employment is terminated by the Company without Cause (other than by reason of the Participant’s death or Disability) or (ii) a Participant’s employment is terminated by the Participant for Good Reason; provided, that if the termination described in clause (i), or the event constituting Good Reason giving rise to the termination described in clause (ii), as applicable, occurs before such Change in Control but the Participant can reasonably demonstrate that such termination or event, as applicable, occurred at the request of a third party who had taken steps reasonably calculated to effect a Change in Control, the termination or event, as applicable, will be treated for all purposes of this Plan as having occurred immediately following the Change in Control. Notwithstanding the foregoing, in no event shall any benefits be provided to a Participant under this Plan unless the Participant has executed and not revoked a restrictive covenant and release agreement in the form attached hereto as Exhibit B.

 

4.2 Separation Benefits.

 

(a) In General. If a Participant’s employment is terminated in circumstances entitling him or her to a Separation Benefit as provided in Section 4.1, the Company shall pay such Participant a lump sum in cash, within thirty (30) days of the date such termination takes effect (the “Date of Termination”), a Separation Benefit equal to the product of (a) the sum of the Participant’s Required Base Salary and the Participant’s Target Bonus and (b) the Separation Multiplier shown in Table 1 as determined by the Participant’s designated Tier Level.

 

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Table 1

 

Tier Level


 

Separation Multiplier


I

 

300%

II

 

200%

III

 

100%

 

(b) Accrued Incentive Pay. In addition, if a Participant’s employment is terminated in circumstances entitling him or her to a Separation Benefit as provided in Section 4.1, the Company shall pay such Participant a lump sum in cash, within 30 days after the Date of Termination, in an amount equal to the sum of: (a) the amount of any unpaid annual bonus under the MIP or any successor plan or award under the LTIP or any successor plan for any completed performance period, (b) the product of (x) the Target Bonus and (y) a fraction, the numerator of which is the number of days in the bonus year in which the Date of Termination occurs through the Date of Termination and the denominator of which is 365, and (c) an award under the LTIP for each applicable performance cycle the year in which the Date of Termination occurs to the extent provided in the LTIP.

 

(c) Welfare and Other Benefits. In addition, during the Welfare Benefit Period or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall provide to a Participant entitled to a Separation Benefit, continued health care, dental and life insurance for the Participant and/or the Participant’s family at least equal to, and at the same cost to the Participant and/or the Participant’s family, as those that would have been provided to them in accordance with the plans, programs, practices and policies in effect as of immediately prior to a Change in Control or, if more favorable to the Participant, as in effect generally at any time thereafter with respect to other peer executives of the Company and its affiliates and their families; provided, however, that notwithstanding the Welfare Benefit Period, such medical and other welfare benefits shall terminate upon such time as the Participant becomes reemployed with another employer and is eligible to receive such benefits under another employer provided plan. For the purposes of this Section 4.2(b), the term “Welfare Benefit Period” shall mean (i) for Participants designated as Tier Level I, three years; (ii) for Participants designated as Tier Level II, two years; and (iii) for Participants designated as Tier Level III, one year; provided, however, that in no event will the Welfare Benefit Period for any Participant extend beyond December 31 of the year that is two years after the calendar year in which the Date of Termination occurs. By way of example, if the Date of Termination for a Participant designated as Tier Level I is March 1, 2006, the Welfare Benefit Period for such Participant will extend from March 1, 2006, through December 31, 2008. The Participant’s entitlement to COBRA continuation coverage under Section 4980B of the Code (“COBRA Coverage”) shall not be offset by the provision of benefits under this Section 4.2(c) and the period of COBRA Coverage shall commence at the end of the Welfare Benefit Period , during which the Participant receives benefits under this Section 4.2(c). A Participant entitled to a Separation Benefit will also be entitled to participate in the Company’s outplacement assistance

 

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program, provided by the Company’s selected outplacement services firm, as in effect under the Company’s policy applicable to the Participant on the date of the Change in Control, for a period of one (1) year following his or her Date of Termination. In addition, to the extent a Participant entitled to a Separation Benefit was eligible to receive financial counseling benefits under the Company’s policy in effect at the time of a Change in Control, such Participant shall be entitled to receive such financial counseling benefits for a period of one (1) year following his or her Date of Termination.

 

4.3 Other Benefits Payable. The Separation Benefit provided pursuant to Section 4.2 above shall be provided in addition to, and not in lieu of, all other accrued or vested or earned but deferred compensation, rights, options or other benefits which may be owed to a Participant upon or following termination, including but not limited to accrued vacation or sick pay, reimbursement for business expenses previously incurred, amounts or benefits payable under any bonus or other compensation plans, the MIP, the LTIP, stock option plan, stock ownership plan, stock purchase plan, life insurance plan, health plan, disability plan or similar or successor plan, other than any severance plan, program, agreement or arrangement, including but not limited to the NCR Workforce Redeployment Plan, unless such plan, program, agreement or arrangement has a specific reference to this Section 4.3. Stock options and other stock awards under the NCR Management Stock Plan will vest and become payable or exercisable upon the occurrence of a Change in Control to the extent provided in that plan.

 

4.4 Tax Gross-Up.

 

(a) Anything in this Plan to the contrary notwithstanding and except as set forth below, in the event it shall be determined that any Payment would be subject to the Excise Tax, then the Participant shall be entitled to receive an additional payment (the “Gross-Up Payment”) in an amount such that, after payment by the Participant of all taxes (and any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Participant retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions of this Section 4.4(a), if it shall be determined that the Participant is entitled to the Gross-Up Payment, but that the Parachute Value of all Payments does not exceed 110% of the Safe Harbor Amount, then no Gross-Up Payment shall be made to the Participant and the amounts payable under this Plan shall be reduced so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount. The reduction of the amounts payable hereunder, if applicable, shall be made by first reducing the payments under Section 4.2(a), unless an alternative method of reduction is elected by the Participant, and in any event shall be made in such a manner as to maximize the Value of all Payments actually made to the Participant. For purposes of reducing the Payments to the Safe Harbor Amount, only amounts payable under this Plan (and no other Payments) shall be reduced. If the reduction of the amount payable under this Plan would not result in a reduction of the Parachute Value of all Payments to the Safe Harbor Amount, no amounts payable under the Plan shall be reduced pursuant to this Section 4.4(a). Notwithstanding anything in this Plan to the contrary, the Company’s obligations under this Section 4.4 shall not be conditioned upon the Participant’s termination of employment. By way of example, in the event of a Change In Control which does not result in a Participant’s termination of employment or entitlement to a Separation Benefit under this Plan, but which causes the accelerated vesting of such Participant’s stock options under a separate plan giving rise to an Excise Tax, the Company’s obligations under this Section 4.4 shall apply with respect to such accelerated vesting.

 

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(b) Subject to the provisions of Section 4.4(c), all determinations required to be made under this Section 4.4, including whether and when a Gross-Up Payment is required, the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by the Company’s then current independent outside auditors, or such other nationally recognized certified public accounting firm as may be designated by the Plan Committee immediately prior to a Change In Control (the “Accounting Firm”). The Accounting Firm shall provide detailed supporting calculations both to the Company and the Participant within 15 business days of the receipt of notice from the Participant that there has been a Payment or such earlier time as is requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Plan Committee may appoint another nationally recognized accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 4.4, shall be paid by the Company to the Participant within 5 days of the receipt of the Accounting Firm’s determination. Any determination by the Accounting Firm shall be binding upon the Company and the Participant. As a result of uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been made by the Company should have been made (the “Underpayment”), consistent with the calculations required to be made hereunder. In the event the Company exhausts its remedies pursuant to Section 4.4(c) and the Participant thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of the Participant.

 

(c) The Participant shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment. Such notification shall be given as soon as practicable, but no later than 10 business days after the Participant is informed in writing of such claim. The Participant shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Participant shall not pay such claim prior to the expiration of the 30-day period following the date on which the Participant gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Participant in writing prior to the expiration of such period that the Company desires to contest such claim, the Participant shall:

 

(i) give the Company any information reasonably requested by the Company relating to such claim,

 

(ii) take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company,

 

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(iii) cooperate with the Company in good faith in order effectively to contest such claim, and

 

(iv) permit the Company to participate in any proceedings relating to such claim;

 

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest, and shall indemnify and hold the Participant harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Section 4.4(c), the Company shall control all proceedings taken in connection with such contest, and, at its sole discretion, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the applicable taxing authority in respect of such claim and may, at its sole discretion, either pay the tax claimed to the appropriate taxing authority on behalf of the Participant and direct the Participant to sue for a refund or contest the claim in any permissible manner, and the Participant agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that, if the Company pays such claim and directs the Participant to sue for a refund, the Company shall indemnify and hold the Participant harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties) imposed with respect to such payment or with respect to any imputed income in connection with such payment; and provided, further, that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Participant with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s control of the contest shall be limited to issues with respect to which the Gross-Up Payment would be payable hereunder, and the Participant shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

 

(d) If, after the receipt by the Participant of a Gross-Up Payment or payment by the Company of an amount on the Participant’s behalf pursuant to Section 4.4(c), the Participant becomes entitled to receive any refund with respect to the Excise Tax to which such Gross-Up Payment relates or with respect to such claim, the Participant shall (subject to the Company’s complying with the requirements of Section 4.4(c), if applicable) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after payment by the Company of an amount on the Participant’s behalf pursuant to Section 4.4(c), a determination is made that the Participant shall not be entitled to any refund with respect to such claim and the Company does not notify the Participant in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then the amount of such payment shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.

 

(e) Notwithstanding any other provision of this Section 4.4, the Company may, in its sole discretion, withhold and pay over to the Internal Revenue Service or any other applicable taxing authority, for the benefit of the Participant, all or any portion of any Gross-Up Payment, and the Participant hereby consents to such withholding.

 

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(f) Definitions. The following terms shall have the following meanings for purposes of this Section 4.4.

 

(i) “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.

 

(ii) “Parachute Value” of a Payment shall mean the present value as of the date of the change of control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.

 

(iii) A “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Participant, whether paid or payable pursuant to this Plan or otherwise.

 

(iv) The “Safe Harbor Amount” means 2.99 times the Participant’s “base amount,” within the meaning of Section 280G(b)(3) of the Code.

 

(v) “Value” of a Payment shall mean the economic present value of a Payment as of the date of the change of control for purposes of Section 280G of the Code, as determined by the Accounting Firm using the discount rate required by Section 280G(d)(4) of the Code.

 

4.5 Payment Obligations Absolute. Except as otherwise provided in Section 4.2(c), the Company’s obligation to make the payments provided for in this Plan and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against a Participant or others. In no event shall a Participant be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Participant under any of the provisions of this Plan, and such amounts shall not be reduced whether or not the Participant obtains other employment.

 

4.6 Section 409A. Notwithstanding the foregoing provisions of this Article IV, to the extent required in order to comply with Section 409A of the Code, amounts and benefits to be paid or provided under this Article IV shall be paid or provided to the Participants on the first business day after the date that is six months following the Participant’s Date of Termination.

 

ARTICLE V

SUCCESSOR TO COMPANY

 

This Plan shall bind any successor of or to the Company, its assets or its businesses (whether direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the same extent that the Company would be obligated under this Plan if no succession had taken place. In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Plan, the Company shall require

 

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such successor expressly and unconditionally to assume and agree to perform the Company’s obligations under this Plan, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. The term “Company,” as used in this Plan, shall mean the Company as hereinbefore defined and any successor or assignee to the business or assets which by reason hereof becomes bound by this Plan.

 

ARTICLE VI

DURATION, AMENDMENT AND TERMINATION

 

6.1 Duration. The Plan shall continue in effect from the Effective Date through December 31, 2007 (the “Termination Date”); provided, however, that, unless previously terminated, the Plan shall be automatically extended so as to terminate one year from the Termination Date, unless the Board determines, through a resolution duly adopted by a majority of the entire membership of the Board no later than ninety (90) days prior to the expiration of the then current term, that the Plan shall not be extended, in which event the Plan shall terminate at the expiration of the then current term. In the event that a Change of Control occurs within one year following a termination, the Plan shall not so terminate. If a Change in Control occurs, this Plan shall continue in full force and effect and shall not terminate or expire until after all Participants who become entitled to any payments hereunder shall have received such payments in full and all adjustments required to be made pursuant to Section 4.4 have been made.

 

6.2 Amendment and Termination. The Plan may be amended in any respect by resolution adopted by a majority of the Board; provided, however, in the event that a Change in Control occurs within one year following an amendment to the Plan that would adversely affect the rights or potential rights of Participants, the amendment will not be effective. In anticipation of or on or following a Change in Control, the Plan shall no longer be subject to amendment, change, substitution, deletion, revocation or termination in any respect which adversely affects the rights of Participants without the consent of each Participant so affected. For the avoidance of doubt, removal of a Participant as a Participant (other than as a result of the Participant ceasing to be an Employee) or a decrease in the Participant’s Tier Level shall be deemed to be an amendment of the Plan which adversely affects the right of the Participant.

 

6.3 Form of Amendment. The form of any amendment or termination of the Plan shall be a written instrument signed by a duly authorized officer or officers of the Company, certifying that the amendment or termination has been approved by the Board. An amendment of the Plan in accordance with the terms hereof shall automatically effect a corresponding amendment to all Participants’ rights and benefits hereunder. A termination of the Plan shall in accordance with the terms hereof automatically effect a termination of all Participants’ rights and benefits hereunder.

 

ARTICLE VII

MISCELLANEOUS

 

7.1 Determinations of the Plan Committee; Dispute Resolution. Any interpretation or construction of, or determination or action by, the Plan Committee with respect to the Plan and its administration shall be binding upon any and all parties and persons affected thereby, subject to the exclusive appeal procedure set forth herein, except for any interpretation

 

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or construction of, or determination or action by, the Plan Committee relating to whether a Participant has “Good Reason” to resign, which shall not be determined by the Plan Committee but instead shall be subject to de novo review. If any person eligible to receive benefits under the Plan, or claiming to be so eligible, believes he or she is entitled to benefits in an amount greater than those which he or she has received (a “Claimant”), he or she may file a claim in writing with the NCR Pension and Benefits Committee (“PBC”). The PBC shall review the claim and, within 90 days after the claim is filed, shall give written notice to the Claimant of the decision. If the claim is denied, the notice shall give the reason for the denial, the pertinent provisions of the Plan on which the denial is based, a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation of why such material or information is necessary, and an explanation of the claim review procedure under the Plan. Any person who has had a claim for benefits denied by the PBC shall have the right to request review by the Plan Committee. Such request must be in writing, and must be made within 60 days after such person is advised of the denial of benefits. If written request for review is not received within such 60 day period, the Claimant shall forfeit his or her right to review. The Plan Committee shall review claims that are appealed, and may hold a hearing if it deems necessary, and shall issue a written notice of the final decision. Such notice shall include specific reasons for the decision and specific references to the pertinent Plan provisions on which the decision is based. The decision shall be final and binding upon the Claimant and the Plan Committee and all other persons involved. Any dispute or controversy arising under or in connection with this Plan and not resolved through the foregoing process shall be settled exclusively by arbitration in the City of Dayton, Ohio, in accordance with the rules of the American Arbitration Association then in effect. In addition, and as an exclusive alternative to the filing of a claim with the PBC, a Claimant may seek to resolve a dispute or controversy by filing a claim in arbitration without first seeking the review of the PBC or Plan Committee. The arbitrator may award only those damages which are consistent with the terms of this Plan, and shall not have authority to award punitive damages. Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

 

7.2 Indemnification. If a Participant institutes any legal action in seeking to obtain or enforce, or is required to defend in any legal action the validity or enforceability of, any right or benefit provided by this Plan, the Company shall reimburse the Participant for all reasonable costs and expenses relating to such legal action, including reasonable attorney’s fees and expenses incurred by such Participant, unless a court or other finder of fact having jurisdiction thereof makes a determination that the Participant’s position was frivolous. In no event shall the Participant be required to reimburse the Company for any of the costs and expenses relating to such legal action. The Company’s obligations under this Section 7.2 shall survive the termination of this Plan.

 

7.3 Employment Status. This Plan does not constitute a contract of employment or impose on the Participant or the Company any obligation to retain the Participant as an Employee, to change the status of the Participant’s employment, or to change the Company’s policies or those of its Subsidiaries’ regarding termination of employment.

 

7.4 Validity and Severability. The invalidity or unenforceability of any provision of the Plan shall not affect the validity or enforceability of any other provision of the Plan, which shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

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7.5 Section 409A Savings Clause. If any compensation or benefits provided by this Plan may result in the application of Section 409A of the Code, the Company shall modify the Plan in the least restrictive manner necessary in order to exclude such compensation from the definition of “deferred compensation” within the meaning of such Section 409A or in order to comply with the provisions of Section 409A, other applicable provision(s) of the Code and/or any rules, regulations or other regulatory guidance issued under such statutory provisions and without any diminution in the value of the payments to the Participants.

 

7.6 Governing Law. The validity, interpretation, construction and performance of the Plan shall in all respects be governed by the laws of Maryland, without reference to principles of conflict of law, and to the extent not preempted by ERISA.

 

7.7 Trust. The Compensation Committee may establish a trust with a bank trustee, for the purpose of paying benefits under this Plan. If so established, the trust shall be a grantor trust subject to the claims of the Company’s creditors and shall, immediately prior to a Change in Control, be funded in cash or common stock of the Company or such other assets as the Compensation Committee deems appropriate with an amount equal to 120 percent of the aggregate benefits payable under this Plan (including without limitation any required Gross-Up Payments) assuming that all Participants in the Plan incurred a termination of employment entitling them to Separation Benefits immediately following the Change in Control.

 

7.8 Withholding. The Company may withhold from any amount payable or benefit provided under this Plan such Federal, state, local, foreign and other taxes as are required to be withheld pursuant to any applicable law or regulation.

 

IN WITNESS WHEREOF, the NCR Corporation Change in Control Severance Plan is adopted effective January 1, 2006.

 

NCR Corporation

By:

 

/s/ Christine Wallace


 

 

Christine Wallace, Senior Vice President,

Human Resources

 

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Exhibit A

Participants and Tier Levels

 

The following positions are the initial Participants, and their respective Tier Levels, under this Plan:

 

Participant


  

Tier Level


President and Chief Executive Officer

  

I

Senior Vice President and Chief Financial Officer

  

I

Senior Vice President, Financial Solutions Division

  

I

Senior Vice President, Retail Solutions Division

  

I

Senior Vice President, Teradata Division

  

I

Senior Vice President, Worldwide Customer Services

  

I

Senior Vice President, General Counsel and Secretary

  

II

Senior Vice President, Human Resources

  

II

Senior Vice President and Chief Administrative Officer

  

II

Vice President and General Manager, Systemedia Division

  

II

Vice President and General Manager, Payment Solutions

  

II

Vice President and Chief Communications Officer

  

II

 

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Exhibit B

Form of

GENERAL RELEASE

 

1.

In consideration of the payments and benefits to which                      (the “Participant”) is entitled from the NCR Corporation Change in Control Severance Plan (the “Plan”) as set forth on Schedule A hereto, the Participant for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasors”) does hereby irrevocably and unconditionally release, acquit and forever discharge NCR Corporation (the “Company”) and its subsidiaries, affiliates and divisions (the “Affiliated Entities”) and their respective predecessors and successors and their respective, current and former, trustees, officers, directors, partners, shareholders, agents, employees, consultants, independent contractors and representatives, including without limitation all persons acting by, through, under or in concert with any of them (collectively, “Releasees”), and each of them from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, remedies, actions, causes of action, suits, rights, demands, costs, losses, debts and expenses (including attorneys’ fees and costs) of any nature whatsoever, known or unknown, whether in law or equity and whether arising under federal, state or local law and in particular including any claim for discrimination based upon race, color, ethnicity, sex, age [(including the Age Discrimination in Employment Act of 1967)], national origin, religion, disability, or any other unlawful criterion or circumstance, relating to the Participant’s employment or termination thereof, which the Participant and Releasors had, now have, or may have in the future against each or any of the Releasees from the beginning of the world until the date hereof (the “Execution Date”).

 

2.

[The Participant acknowledges that: (i) this entire agreement is written in a manner calculated to be understood by him; (ii) he has been advised to consult with an attorney before executing this agreement; (iii) he was given a period of [forty-five][twenty-one] days within which to consider this agreement; and (iv) to the extent he executes this agreement before the expiration of the [forty-five][twenty one]-day period, he does so knowingly and voluntarily and only after consulting his attorney. The Participant shall have the right to cancel and revoke this agreement during a period of seven days following the Execution Date, and this agreement shall not become effective, and no money shall be paid hereunder, until the day after the expiration of such seven-day period. The seven-day period of revocation shall commence upon the Execution Date. In order to revoke this agreement, the Participant shall deliver to the Company, prior to the expiration of said seven-day period, a written notice of revocation. Upon such revocation, this agreement shall be null and void and of no further force or effect.]

 

3.

Notwithstanding anything else herein to the contrary, this Release shall not affect: the obligations of the Company set forth in the Plan or other obligations that, in each case, by their terms, are to be performed after the date hereof (including, without limitation, obligations to Participant under any stock option, stock award or agreements or obligations under any pension plan or other benefit or deferred compensation plan, all of which shall remain in effect in accordance with their terms); obligations to indemnify the Participant respecting acts or omissions in connection with the Participant’s service as a director, officer or employee of the Affiliated Entities; obligations with respect to insurance coverage under any of the Affiliated

 

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Entities’ (or any of their respective successors) directors’ and officers’ liability insurance policies; or any right Participant may have to obtain contribution in the event of the entry of judgment against Participant as a result of any act or failure to act for which both Participant and any of the Affiliated Entities are jointly responsible.

 

4.

The Participant agrees that for a period of eighteen months after the Date of Termination, without the prior written consent of the Chief Executive Officer of the Company, the Participant will not (1) render services directly or indirectly to any Competing Organization (as defined below) involving the development, manufacture, marketing, advertising or servicing of any product, process, system or service upon which the Participant worked or in which the Participant participated during the last three years of the Participant’s employment with the Company, (2) directly or indirectly recruit, hire, solicit or induce, or attempt to induce, any exempt employee of the Company to terminate his or her employment with or otherwise cease his or her relationship with the Company, (3) canvass or solicit business with any firm or company with whom the Participant worked during the preceding five years while employed by the Company, including customers of the Company, or (4) disclose to any third party any of the Company’s confidential, technical, marketing, business, financial or other information not publicly available. As used in this paragraph 4, “Competing Organization” means an organization identified by the Chief Executive Officer of the Company and set forth on Schedule B as such Schedule may be updated or augmented from time to time, provided that in no event shall any organizations be added to Schedule B in anticipation of, on or following a Change in Control. In the event that a Change in Control occurs within one year following the addition of any organizations to Schedule B, such organization shall not be considered to be a “Competing Organization” for any purpose. The Participant understands that if the Participant breaches this section, the Company may sustain irreparable injury and may not have an adequate remedy at law. As a result, the Participant agrees that in the event of the Participant’s breach of this section, the Company may, in addition to any other remedies available to it, bring an action or actions for injunction, specific performance, or both, and have entered a temporary restraining order, preliminary or permanent injunction, or order compelling specific performance.

 

5.

This Agreement shall be construed, enforced and interpreted in accordance with and governed by the laws of the State of Maryland, without reference to its principles of conflict of laws.

 

6.

It is the intention of the parties hereto that the provisions of this Agreement shall be enforced to the fullest extent permissible under all applicable laws and public policies, but that the unenforceability or the modification to conform with such laws or public policies of any provision hereof shall not render unenforceable or impair the remainder of the Agreement. Accordingly, if any provision shall be determined to be invalid or unenforceable either in whole or in part, this Agreement shall be deemed amended to delete or modify as necessary the invalid or unenforceable provisions to alter the balance of this Agreement in order to render the same valid and enforceable.

 

7.

This Agreement may not be orally canceled, changed, modified or amended, and no cancellation, change, modification or amendment shall be effective or binding, unless in writing and signed by both parties to the Agreement.

 

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8.

If the Participant institutes any legal action in seeking to obtain or enforce, or is required to defend in any legal action the validity or enforceability of, any right or benefit provided by the Plan, the Company shall reimburse the Participant for all reasonable costs and expenses relating to such legal action, including reasonable attorney’s fees and expenses incurred by such Participant, unless a court or other finder of fact having jurisdiction thereof makes a determination that the Participant’s position was frivolous. In no event shall the Participant be required to reimburse the Company for any of the costs and expenses relating to such legal action.

 

9.

Capitalized terms used but not defined herein shall have the meaning set forth in the Plan.

 

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IN WITNESS WHEREOF, the undersigned parties have executed this Agreement, which includes a release.

 

NCR CORPORATION

By:

 

 


[name]

 

 

[title]

 

 

PARTICIPANT

Voluntarily Agreed to and Accepted this      day of                      20    

 


[                    ]

 

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Schedule A

Benefits Payable to Participant

 

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Top of the Document

 

EX-10.15.1 5 dex10151.htm FIRST AMENDMENT TO THE NCR CHANGE IN CONTROL SEVERANCE PLAN

Exhibit 10.15.1

FIRST AMENDMENT TO NCR CORPORATION

CHANGE IN CONTROL SEVERANCE PLAN

WHEREAS, the NCR Corporation (the “Company”) has previously adopted the Company’s Change in Control Severance Plan (the “Plan”); and

WHEREAS, the Plan provides that the Compensation and Human Resource Committee of the Board of Directors of the Company (the “Compensation Committee”) may establish and fund a grantor trust upon the occurrence of a Change in Control (as defined in the Plan);

WHEREAS, the Pension Protection Act of 2006 (the “Act”) has recently been signed into law and is currently effective; and

WHEREAS, the Act imposes significant tax penalties on senior executives of companies that set aside assets, or participate in a plan that provides for the setting aside of assets, to fund deferred compensation plan benefits for current and former Section 16 officers and “covered employees” under Section 162(m) of the Code during specified periods; and

WHEREAS, the Board of Directors of the Company (the “Board”) wishes to minimize the risk that such penalties may be imposed; and

WHEREAS, the Board has determined that, in furtherance of these objectives, it is desirable to amend the Plan as permitted by Section 6.2 of the Plan; and

NOW THEREFORE, effective as of the date hereof, the Plan is hereby amended as follows:

 

 

1.

Section 7.7 is hereby amended to read in its entirety as follows:

Trust. The Compensation Committee may establish a trust with a bank trustee, for the purpose of paying benefits under this Plan. If so established, the trust shall be a grantor trust subject to the claims of the Company’s creditors and shall, immediately prior to a Change in Control, be funded in cash or common stock of the Company or such other assets as the Compensation Committee deems appropriate with an amount equal to 120 percent of the aggregate benefits payable under this Plan (including without limitation any required Gross-Up Payments) assuming that all Participants in the Plan incurred a termination of employment entitling them to Separation Benefits immediately following the Change in Control, provided, that, in the event that such funding would result in the imposition of taxes and penalties under Section 409A of the Code with respect to any current or former Section 16 officers or any “covered employees” within the meaning of Section 162(m) of the Code, the trust shall not be funded with respect to such individuals.


 

2.

Except as expressly modified hereby, the terms and provisions of the Plan shall remain in full force and effect.

 

NCR CORPORATION

By:

 

 

/s/ Peter Lieb

Name:

 

 

Peter Lieb

Title:

 

 

Senior Vice President,

 

 

General Counsel and Secretary