EXHIBIT 10.12
PULITZER INC.
EXECUTIVE TRANSITION
PLAN
1. Purpose. The purpose of the Plan
is to establish equitable and comprehensive parameters for
providing severance protection to covered executives.
2. Definitions.
(a) “Accrued
Compensation” means, with respect to a Participant as of the
termination of the Participant’s employment with the Company
and its Affiliates, any previously earned and unpaid base salary or
commissions, accrued and unpaid bonus for the preceding year, and
additional entitlements under any employee plan, program or
arrangement of the Company or an Affiliate (other than the
Plan).
(b) “Affiliate” means
any entity at least 50% of the voting, capital or profits interests
of which is owned directly or indirectly by the Company.
(c) “Benefit
Continuation” means continuing coverage for a Participant
and, where applicable, the Participant’s covered spouse and
covered eligible dependents under each of the Company’s group
health and group life insurance plans for such period following the
termination of the Participant’s employment with the Company
and its Affiliates as is specified in Section 5 or 6 herein with
respect to such termination of employment (or, if sooner, until
corresponding coverage is obtained under a successor
employer’s plan) at the same benefit and contribution levels
in effect immediately prior to such termination of employment or,
to the extent not permitted by the plan or by applicable law, cash
payments sufficient to enable the Participant and/or the
Participant’s covered spouse and covered eligible dependents,
on an after tax basis, to obtain comparable individual coverage
through the end of such period. The continuing group health plan
coverage component of a Participant’s Benefit Continuation
will be made available in addition to and not in lieu of COBRA
continuation coverage.
(d) “Board” means the
Board of Directors of the Company.
(e) “Cause” means (1)
the commission of a felony involving moral turpitude, (2) the
willful and repeated failure or refusal to carry out the material
responsibilities of a Participant’s employment with the
Company or an Affiliate, or (3) any other willful misconduct or
pattern of behavior which has had or is reasonably likely to have a
significant adverse effect on the Company or an Affiliate, all as
determined by the Board acting in its sole discretion.
Notwithstanding the preceding sentence, if there is a written
employment agreement in effect between a Participant and the
Company or an Affiliate that defines the term “cause”
(or a term of like import) in a similar context, then, with respect
to that Participant, the term Cause, as used in such context
herein, shall have the meaning ascribed to such term under the
Participant’s employment agreement.
(f) “Change in Control”
means the occurrence of any of the following after June 30,
2001:
(i) any person (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (“Exchange Act”)) becomes the
beneficial owner (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 40% or more of the combined voting power
of the then outstanding voting securities of the Company, other
than (1) a person who is the beneficial owner of shares of Class B
Common Stock of the Company, or (2) as a result of
inheritance;
(ii) a consolidation, merger or
reorganization involving the Company, unless (1) the stockholders
of the Company immediately before such consolidation, merger or
reorganization own, directly or indirectly, at least a majority of
the combined voting power of the outstanding voting securities of
the corporation resulting from such consolidation, merger or
reorganization, (2) individuals who were members of the Board
immediately prior to the execution of the agreement providing for
such consolidation, merger or reorganization constitute a majority
of the board of directors of the surviving corporation or of a
corporation directly or indirectly beneficially owning a majority
of the voting securities of the surviving corporation, and (3) no
person beneficially owns more than 40% of the combined voting power
of the then outstanding voting securities of the surviving
corporation (other than a person who is (A) the Company or a
subsidiary of the Company, (B) an employee benefit plan maintained
by the Company, the surviving corporation or any subsidiary, or (C)
the beneficial owner of 40% or more of the combined voting power of
the outstanding voting securities of the Company immediately prior
to such consolidation, merger or reorganization);
(iii) individuals who, as of July 1,
2001, constitute the entire Board (the “Incumbent
Board”) cease for any reason to constitute a majority of the
Board, provided that any individual becoming a director subsequent
to July 1, 2001 whose election, or nomination for election by the
Company’s stockholders, was approved by a vote of at least
two-thirds of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of the
Incumbent Board;
(iv) approval by the stockholders of
the Company of a complete liquidation or dissolution of the
Company, or a sale or other disposition of all or substantially all
of the assets
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of the Company (other than to an
entity described in (f)(ii) above; or
(v) any other event or transaction
which the Board, acting in its discretion and with a view toward
carrying out the purposes of the Plan, designates is a Change in
Control.
Notwithstanding the foregoing, if
there is a written employment or other agreement in effect between
a Participant and the Company or an Affiliate that defines the term
“change in control” or a term of like import in a
similar context, then, for the purposes of applying the provisions
hereof with respect to that Participant, the term Change in
Control, as used in such context herein, shall have the meaning
ascribed to such term under such agreement.
(g) “Code” means the
Internal Revenue Code of 1986, as amended.
(h) “Committee” means
the Compensation Committee of the Board.
(i) “Company” means
Pulitzer Inc., a Delaware corporation, and any successor
thereto.
(j) “Disability” means
the inability of a Participant to substantially perform the
customary duties and responsibilities of the Participant’s
employment with the Company or an Affiliate for a period of at
least 120 consecutive days by reason of a physical or mental
incapacity which is expected to result in death or last
indefinitely.
(k) “ERISA” means the
Employee Retirement Income Security Act of 1974, as
amended.
(l) “Good Reason” means
the occurrence of any of the following without the written consent
of the Participant: (1) a material diminution by the Company or an
Affiliate of the Participant’s duties or responsibilities in
a manner which is inconsistent with his or her position or which
has or is reasonably likely to have a material adverse effect on
the Participant’s status or authority; (2) a material
diminution of a Participant’s working conditions (including,
without limitation, relocation by more than 50 miles of the
Participant’s principal place of business); (3) a reduction
by the Company or an Affiliate of a Participant’s rate of
salary or annual incentive opportunity or a breach by the Company
or any of its Affiliates of a material provision of any written
employment or other agreement with the Participant which is not
corrected within 15 days following notice thereof by the
Participant to the Company; or (4) any other event specified in the
Plan Certificate as constituting Good Reason. Notwithstanding the
preceding sentence, if there is a written employment agreement in
effect between a Participant and the Company or an Affiliate that
defines the term “good reason” (or a term of like
import) in a similar context, then, for the purpose of applying the
provisions hereof with respect to that Participant, the term Good
Reason as used in such similar context herein, shall have the
meaning ascribed to that term under such employment
agreement.
(m) “Participant” means
an individual who is designated as such in accordance with Section
4.
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(n) “Plan” means the
Pulitzer Inc. Executive Transition Plan the terms of which are set
forth herein.
(o) “Plan Certificate”
means a written agreement or certificate setting forth the rights
of a Participant under the Plan, which rights will be fixed by the
Committee or the Board in accordance with the provisions
hereof.
(p) “Pro Rata Cash
Bonus” means a Participant’s target annual bonus under
the Company’s executive incentive compensation plan for the
year in which his or her employment is terminated (or, if greater,
the actual annual bonus earned by the Participant under that plan
for such year) multiplied by a fraction, the numerator of which is
the number of days from the beginning of the fiscal year through
the termination date, and the denominator of which is the total
number of days in the fiscal year.
(q) “Total Cash
Compensation” means, as of the effective date of the
termination of a Participant’s employment with the Company
and its Affiliates, the sum of: (1) the Participant’s highest
annual rate of salary at any time during the preceding 24 months,
and (2) the Participant’s average annual cash incentive bonus
under the Company’s executive incentive compensation plan for
the preceding three fiscal years (or such lesser number of full
fiscal years of the Participant’s employment with the Company
and/or an Affiliate). If a Participant’s employment
terminates during the same fiscal year in which it begins, then the
bonus component of the Participant’s Total Cash Compensation
will be the Participant’s annualized target bonus for such
year.
3. Administration.
(a) The Committee. The Plan shall be
administered by the Committee. Subject to the provisions of the
Plan, the Committee, acting in its sole and absolute discretion,
shall have full power and authority to interpret, construe and
apply the provisions of the Plan and to take such actions as it
deems necessary or appropriate in order to carry out the provisions
of the Plan. A majority of the members of the Committee will
constitute a quorum. The Committee may act by the vote of a
majority of its members present at a meeting at which there is a
quorum or by unanimous written consent. The decision of the
Committee as to any disputed question, including questions of
construction, interpretation and administration of the Plan or any
Plan Certificate, shall be final and conclusive on all persons. The
Committee shall keep a record of its proceedings and acts and shall
keep or cause to be kept such books and records as may be necessary
in connection with the proper administration of the Plan. The
Committee may delegate to other persons, including, without
limitation, employees of the Company or an Affiliate, such duties
and functions as it deems appropriate in connection with the
administration of the Plan.
(b) Indemnification. The Company
shall indemnify and hold
