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Exhibit 10.120 RUSS BERRIE AND COMPANY, INC.
AMENDED AND RESTATED
CHANGE IN CONTROL SEVERANCE PLAN The purpose of this Amended
and Restated Change in Control Severance Plan (the "Plan") is to
enable Russ Berrie and Company, Inc., a New Jersey corporation (the
"Company"), to offer a form of income protection to "Participants"
(as defined in Section 7.5 below) in the event their
employment with the Company terminates under certain circumstances
due to a "Change in Control" (as defined in Section 7.2
below). Notwithstanding anything herein to the contrary, however,
if in connection with any sale of any substantial line of business
of the Company, a Participant employed within such line of business
is offered and accepts employment by the purchaser of such line of
business or its affiliates, no "termination" hereunder shall be
deemed to have occurred, no benefits shall be payable hereunder,
and the Participant shall cease to be a Participant hereunder.
ARTICLE I: BENEFITS 1.1 Eligibility for Benefits;
Benefits; Payment; and Rights of Participants . (a) If a
Participant’s employment with the Company is terminated by
the Company without "Cause" (as defined in Section 7.1 below)
or by the Participant for "Good Reason" (as defined in
Section 7.4 below) (each, a "Qualifying Termination") during
the period commencing six months prior to and ending two years
after a Change in Control, such Participant shall be paid the
applicable "Severance Benefit" (as defined below) and shall receive
the additional benefits described in this Article I. The term
"Severance Benefit" shall mean:
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(i)
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if the Qualifying Termination occurs during the six-month period
preceding or the one-year period following the Change in Control,
an amount equal to 150% of the Participant’s "Current Total
Annual Compensation" (as defined in Section 7.3 below);
and
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(ii)
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if the Qualifying Termination occurs during the second year
after the Change in Control, an amount equal to 75% of the
Participant’s Current Total Annual Compensation.
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(b) Any Participant entitled to a Severance Benefit (in
accordance with Section 1.1(a) above) whose Qualifying
Termination occurs within two years after a Change in Control shall
receive his Severance Benefit in the form of a lump-sum payment
within 30 business days after his employment with the Company
terminates; any Participant entitled to a Severance Benefit (in
accordance with Section 1.1(a) above) whose Qualifying
Termination occurs prior to a Change in Control shall receive his
Severance Benefit in the form of a lump-sum payment six months and
one day following his termination of employment with the Company,
provided that a Change in Control occurs during such period.
(c) Notwithstanding anything herein to the contrary, if the
Company determines in good faith that any Participant is a
"specified employee" within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended, and any regulations or
other guidance issued thereunder, or any successor similar
provision, regulations or guidance ("Section 409A") when payments
hereunder are due him, if all or any portion of such payments
(whether alone or in combination with payments from any other plan
maintained by the Company) would, in the good faith opinion of the
Company, subject such Participant to the excise tax and/or interest
provisions under Section 409A if paid in full within six
months of such Participant’s termination date, the Company
shall reduce the amounts payable to such Participant hereunder (and
from any other plan required to be aggregated with this Change in
Control Plan pursuant to Section 409A) to the maximum amount
payable under Section 409A in such six-month period, and all
remaining amounts otherwise payable to such Participant shall be
paid (in a lump sum, without interest) to such Participant on the
day which is six months and one day after the Participant’s
termination of employment. 1.2 Additional Benefits . A
Participant entitled to receive a Severance Benefit shall also
receive the following additional benefits: (a) The Company
shall cause options to purchase Company stock ("Stock Options")
held by a Participant that are not fully vested and exercisable on
the date of the Qualifying Termination to:
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(i)
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if the Qualifying Termination occurs during the six months
preceding or the first year following the Change in Control, become
fully vested and exercisable as of the date of such Qualifying
Termination (or, if later, as of the date on which the Change in
Control occurred); and
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(ii)
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if the Qualifying Termination occurs during the second year
following the Change in Control, become fully vested and
exercisable as of the date of such Qualifying Termination as to
those Stock Options that would otherwise have vested within one
year after the Qualifying Termination.
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(b) The Company shall cause unvested restricted shares of
Company stock (the "Restricted Shares") held by a Participant on
the date of the Qualifying Termination to:
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(i)
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if the Qualifying Termination occurs during the six months
preceding or the first year following the Change in Control, become
fully vested as of the date of such Qualifying Termination (or, if
later, as of the date on which the Change in Control occurred) as
to those Restricted Shares for which the vesting restrictions would
otherwise have lapsed within one year after the Qualifying
Termination; and
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(ii)
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if the Qualifying Termination occurs during the second year
after the Change in Control, become fully vested as of the date of
such Qualifying Termination as to those Restricted Shares for which
the vesting restrictions otherwise would have lapsed within six
months after the Qualifying Termination.
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(c) The Company shall for a period of 18 months (in
the case of a Qualifying Termination to which
Section 1.1(a)(i) applies) or one year (in the case of a
Qualifying Termination to which Section 1.1(a)(ii) applies)
following the Qualifying Termination continue to provide to the
Participant (i) use of an automobile or payment of an
automobile allowance in an amount sufficient to compensate the
Participant to substantially the same extent as if the Company
continued to provide the automobile and (ii) medical and other
insurance benefits, in each case to the extent and on substantially
the same basis as provided immediately prior to the Qualifying
Termination (disregarding any reduction described in
clause (B) of the definition of Good Reason). 1.3 Reduction
of Payments . If a Participant’s receipt of any payment
and/or non-monetary benefit under this Plan (including, without
limitation, the accelerated vesting of Stock Options and/or
Restricted Shares) (collectively, the "Plan Payments") would cause
him or her to become subject to the excise tax imposed under
Section 4999 of the Internal Revenue Code of 1986, as amended
(the "Code"), the Company shall reduce his or her Plan Payments to
the extent necessary to avoid the application of such excise tax if
(i) the required reduction does not exceed 10% of the
aggregate amount of the Plan Payments and (ii) as a result of
such reduction, the net benefits to the Participant of the Plan
Payments as so reduced (after payment of applicable income taxes)
exceeds the net benefit to the Participant of the Plan Payments
without such reduction (after payment of applicable income taxes
and excise taxes). If a reduction in Plan Payments to a Participant
in the amount permitted by clause (i) is insufficient to avoid
the application of such excise tax, then the provisions of
"Exhibit A," attached hereto and incorporated herein, shall
apply to that Participant. 1.4 Rights of Participants .
Nothing contained herein shall be held or construed to create any
liability or obligation on the Company to retain any Participant in
its service or in a corporate officer position. All Participants
shall remain subject to discharge or discipline to the same extent
as if the Plan did not exist. ARTICLE II: FUNDING 2.1
Funding . The Plan shall be funded out of the general assets
of the Company as and when benefits are payable under the Plan. All
Participants shall be solely general creditors of the Company.
ARTICLE III: ADMINISTRATION OF THE PLAN 3.1 Plan
Administrator . The general administration of the Plan shall be
placed with the Compensation Committee of the Board of Directors of
the Company (the "Board") or an administrative committee appointed
by the Board (the "Committee"). 3.2 Reimbursement of Expenses of
Committee . The Company shall pay or reimburse the members of
the Committee for all reasonable expenses incurred in connection
with their duties hereunder.
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3.3 Action by the Plan Committee . Decisions of the
Committee shall be made by a majority of its members attending a
meeting at which a quorum is present (which meeting may be held
telephonically), or by written action in accordance with applicable
law. No member of the Committee may act with respect to a matter
which involves only that member. 3.4 Delegation of Authority
. The Committee may delegate any and all of its powers and
responsibilities hereunder to other persons by formal resolution
filed with and accepted by the Board. Any such delegation shall not
be effective until it is accepted by the Board and the persons
designated and may be rescinded at any time by written notice from
the Committee to the person to whom the delegation is made. 3.5
Retention of Professional Assistance . The Committee may
employ such legal counsel, accountants and other persons as may be
required in carrying out its work in connection with the Plan, and
the Company shall pay the fees and expenses of such persons. 3.6
Accounts and Records . The Committee shall maintain such
accounts and records regarding the fiscal and other transactions of
the Plan, and such other data as may be required to carry out its
functions under the Plan and to comply with all applicable laws.
3.7 Compliance with Applicable Law . The Company shall be
deemed the administrator of the Plan for the purposes of any
applicable law and shall be responsible for the preparation and
filing of any required returns, reports, statements or other
filings with appropriate governmental agencies. The Company shall
also be responsible for the preparation and delivery of information
to persons entitled to such information under any applicable law.
3.8 Reimbursement of Expenses . If any contest or dispute
shall arise under this Plan involving termination of a
Participant’s employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance
with the terms hereof and the Participant prevails on the merits in
such contest or dispute, the Company shall, promptly after the date
a court issues a final order from which no appeal can be taken, or
with respect to which the time period to appeal has expired,
reimburse such Participant for all reasonable legal fees and
expenses, if any, paid by the Participant in connection with such
contest or dispute (together with interest in an amount equal to
the J.P. Morgan Chase Bank prime rate from time to time in effect,
such interest to begin to accrue on the dates Participant actually
paid such fees and expenses through the date of payment thereof).
ARTICLE IV: AMENDMENT 4.1 Amendment . The
Company reserves the right to amend, in whole or in part, any or
all of the provisions of this Plan by action of the Board at any
time; provided , that , no such amendment may reduce
the benefits and payments due to any Participant hereunder in the
event of a Qualifying Termination.
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ARTICLE V: SUCCESSORS 5.1 Successors . The
Company shall require any successor or assignee, whether direct or
indirect, by purchase or otherwise (and whether or not by operation
of law), to all or substantially all the business or assets of the
Company, 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 or assignment had taken
place, provided , that , no such assumption and
agreement shall be required from a successor or assignee that
becomes obligated for the Company’s obligations hereunder
through a merger, consolidation or otherwise by operation of law.
In such event, the term "Company," as used in this Plan, shall mean
the Company, as applicable, as hereinbefore defined and any
successor or assignee to the business or assets which by reason
hereof becomes bound by the terms and provisions of this Plan. Any
payment or benefit to which a Participant has become entitled under
this Plan which remains unpaid at the time of such
Participant’s death shall be paid to the estate of such
Participant when it becomes due. ARTICLE VI:
MISCELLANEOUS 6.1 No Duty to Mitigate/Set-off .
No Participant entitled to receive a Severance Benefit shall be
required to seek other employment or to attempt in any way to
reduce any amounts payable to him pursuant to this Plan. The
Severance Benefit payable hereunder shall not be reduced by any
compensation earned by the Participant as a result of employment by
another employer or otherwise. Subject to Section 6.5, the
Company’s obligations to pay the Severance Benefits
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