EXHIBIT 10.43
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 harmless each
member of the Committee and any employee or director of the Company or an
Affiliate to whom any duty or function relating to the administration of the
Plan is delegated from and against any loss, cost, liability (including any sum
paid in settlement of a claim with the approval of the Board), damage and
expense (including legal and other expenses incident thereto) arising out of
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or incurred in connection with the Plan, unless and except to the extent
attributable to such person's fraud or willful misconduct.
4. Participation.
(a) Eligibility to Participate. Senior executive officers and other
key executive or management employees of the Company or an Affiliate are
eligible to become Participants in the Plan. An eligible employee will become a
Participant if (and only if) he or she is designated as a Participant by the
Committee.
(b) Notice of Participation. The Company will provide written
notification to each eligible employee who is designated as a Participant in the
Plan. Subject to the provisions of the Plan, the Committee (or, where
applicable, the Board) will fix the terms and conditions of an individual's
participation in the Plan, which terms and conditions need not be the same for
each Participant. The terms and conditions applicable to a Participant will be
set forth in a separate Plan Certificate.
5. General Severance Protection. Subject to Section 9 (relating to
other agreements which may govern), the provisions of this Section 5 shall apply
upon the termination of a Participant's employment with the Company and its
Affiliates unless and except to the extent that Section 6 (relating to severance
protection upon termination of a Participant's employment in conjunction with a
Change in Control) specifically applies.
(a) Termination by the Company or an Affiliate without Cause. If a
Participant's employment is terminated by the Company or an Affiliate without
Cause, then, subject to Section 10 (relating to the execution and delivery of a
release of claims), the Participant shall be entitled to receive the following
payments and benefits:
(i) the Participant's Accrued Compensation;
(ii) the Participant's Pro Rata Cash Bonus;
(iii) an amount equal to the Participant's Total Cash Compensation
multiplied by 1.0 (or such greater multiplier, not to exceed 3.0, as may be set
forth in the Plan Certificate), which amount shall be payable to the Participant
in equal monthly or more frequent installments over a period of years equal in
number to the multiplier used to calculate such amount, or, if the Committee or
the Board so determines, in a single lump sum; and
(iv) Benefit Continuation for a period of years equal in number to
the multiplier under Section 5(a)(iii).
(b) Disability or Death. If a Participant's employment is terminated
by the Company or an Affiliate due to the Participant's Disability or if the
Participant's employment terminates by reason of death, then the Participant (or
the deceased Participant's beneficiary) shall be entitled to receive the
following payments and benefits:
(i) the Participant's Accrued Compensation;
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(ii) the Participant's Pro-Rata Cash Bonus; and
(iii) Benefit Continuation for a period of years equal in number
to the multiplier under Section 5(a)(iii) (exclusive of life insurance for a
deceased Participant).
(c) Termination by Company or an Affiliate for Cause or Voluntary
Termination by the Participant. If a Participant's employment is terminated by
the Company or an Affiliate for Cause or is voluntarily terminated by the
Participant (for any reason, including Good Reason, or no reason), the
Participant shall be entitled to receive his or her Accrued Compensation,
subject to set off for amounts owed by the Participant to the Company or an
Affiliate, and, except as otherwise specifically provided in his or her Plan
Certificate with respect to a termination by the Participant for Good Reason,
the Company and its Affiliates shall have no further obligation to the
Participant under the Plan.
6. Termination in Conjunction with a Change in Control. Subject to Section
9 (relating to other agreements which may govern), if a Change in Control
occurs, the provisions of this Section 6 will apply with respect to the
termination of a Participant's employment during the period beginning on the
date of the definitive agreement pursuant to which the Change in Control is
consummated and ending on the second anniversary of the Change in Control. If a
Participant is entitled to receive payments and benefits under this Section 6
due to a termination of employment in conjunction with a subsequent Change in
Control and if, with respect to such termination of employment, the Participant
receives payments or benefits under Section 5, then the payments and benefits to
which the Participant is entitled under this Section 6 will be reduced by the
payments and benefits which the Participant has received under Section 5.
(a) Termination by the Company or an Affiliate without Cause or by the
Participant for Good Reason. If a Participant's employment is terminated by the
Company or an Affiliate without Cause or by the Participant for Good Reason
(which, if so provided in his or her Plan Certificate, shall include a voluntary
termination by the Participant during a specified period following the Change in
Control), then, subject to Section 8 (relating to the avoidance of excise tax
liability) and Section 10 (relating to the execution and delivery of a release
of claims), the Participant shall be entitled to receive the following payments
and benefits:
(i) the Participant's Accrued Compensation;
(ii) the Participant's Pro-Rata Cash Bonus;
(iii) an amount equal to the Participant's Total Cash Compensation
multiplied by 1.5 (or such greater multiplier not to exceed 3.0 as may be set
forth in the Plan Certificate), which amount shall be payable in a lump sum in
cash within 10 business days following the date of the Participant's termination
of employment or, if later, the date of the Change in Control;
(iv) Benefit Continuation for a period of years equal in umber to
the multiplier under Section 6(a))(iii); and
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(v) if and to the extent the Committee or the Board so determines,
accelerated vesting and other pension enhancements under the Company's
Supplemental Executive Benefit Pension Plan.
(b) Disability or Death. If a Participant's employment is terminated
by the Company or an Affiliate due to the Participant's Disability, or if the
Participant's employment terminates by reason of death, then the Participant (or
the deceased Participant's beneficiary) shall be entitled to receive the
following payments and benefits:
(i) the Participant's Accrued Compensation;
(ii) the Participant's Pro-Rata Cash Bonus;
(iii) Benefit Continuation for a period of years equal in number
to the multiplier under Section 6(a)(iii) (exclusive of life insurance for a
deceased Participant);
(iv) if and to the extent the Committee or the Board so
determines, accelerated vesting and other benefit enhancements under the
Company's Supplemental Executive Benefit Pension Plan.
(c) Termination by the Company or an Affiliate for Cause or
Termination by the Participant without Good Reason. If a Participant's
employment is terminated by the Company or an Affiliate for Cause or is
voluntarily terminated by the Participant without Good Reason (as modified by
Section 6(a) above), the Participant shall be entitled to receive his or her
Accrued Compensation through the date of termination, subject to set off for
amounts owed by the Participant to the Company or an Affiliate, and neither the
Company nor any Affiliate shall have any further obligation to the Participant
under the Plan.
7. Effect of a Change in Control on Options and Other Equity-Based Awards.
All outstanding Company stock options and other Company equity-based awards held
by a Participant shall become fully vested immediately before the occurrence of
a Change in Control if (a) the Participant is then still employed by the Company
or an Affiliate; or (b) the Participant is entitled to payments and benefits
under Section 6(a) as a result of the termination of his or her employment
during the pre-Change in Control severance protection period described in
Section 6. If a Participant becomes vested in a stock option or other
equity-based award pursuant to part (b) of the preceding sentence, then, before
the Change in Control, the Company will either reinstate the option or award to
the extent it would otherwise not be vested, or make a cash payment to the
Participant equal to the intrinsic value of the non-vested portion of the option
or award based upon the then value per share of the Company's Common Stock. The
vesting and other terms and conditions of a Participant's stock options and
other equity-based awards will continue to govern except as otherwise
specifically provided by this Section 7.
8. 280G Limitation. If a Participant is entitled to receive payments and
benefits under the Plan and if, when combined with the payments and benefits the
Participant is entitled to receive under any other plan, program or arrangement
of the Company or an Affiliate, the Participant would be subject to excise tax
under Section 4999 of the Code, then, unless and except to the extent the Board
approves a gross-up or other remedial provision set forth in the
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Participant's Plan Certificate, the severance amounts otherwise payable to the
Participant under Section 6 of the Plan will be reduced by the minimum amount
necessary to ensure that the Participant will not be subject to such excise tax.
9. Effect of Other Agreements. Notwithstanding the provisions hereof or of
any Plan Certificate issued hereunder, the post-termination payment and benefit
provisions of a Participant's written employment or other agreement with the
Company or an Affiliate (if any) will govern (in lieu of the provisions hereof
or of such award) if and to the extent that, with respect to the Participant's
termination of employment, the provisions of such employment agreement would
provide greater payments or benefits to the Participant (or to the Participant's
covered dependents or beneficiaries). If any termination or severance payments
or benefits are made or provided to a Participant by the Company or any or its
Affiliates pursuant to a written employment or other agreement with the Company
or an Affiliate, such payments and benefits shall reduce the amount of the
comparable payments and benefits payable hereunder.
10. Release of Claims. Notwithstanding anything herein to the contrary, the
Committee or the Board may condition severance payments or benefits otherwise
payable under the Plan to a Participant (or beneficiary of a deceased
Participant) on the Participant's (or beneficiary's) execution and delivery of a
general release in favor of the Company, its Affiliates and their officers,
directors and employees, in such form as the Board or the Committee may specify.
Any payment or benefit that is so conditioned may be deferred until the
expiration of the seven day revocation period prescribed by the Age
Discrimination in Employment Act of 1967, as amended, or any similar revocation
period in effect on the effective date of the termination of the Participant's
employment.
11. No Duty to Mitigate/Set Off. Except as otherwise provided in the
Participant's employment or other agreement or in the Plan Certificate, a
Participant entitled to receive any payment or benefits hereunder shall not be
required to seek other employment or to attempt in any way to reduce any amounts
payable to him or her pursuant to the Plan and the payments and benefits payable
hereunder shall not be reduced by any compensation earned by the Participant as
a result of employment or consultancy with another person.
12. 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 general unsecured creditors of the Company. If the Company decides in its
sole discretion to establish any advance accrued reserve on its books against
the future expense of benefits payable hereunder, or if the Company decides in
its sole discretion to fund a trust under the Plan, such reserve or trust shall
not under any circumstances be deemed to be an asset of the Plan.
13. Amendment and Termination. The Board may amend or terminate the Plan
and, pursuant to its authority hereunder, the Board or the Committee may amend a
Participant's Plan Certificate, provided, however, that, any such action which
would have the effect of reducing or diminishing a Participant's entitlements
under the Plan or the Participant's Plan Certificate, as the case may be, shall
not be effective with respect to the Participant (a) if his or her employment
terminates before or within six months after the date such action is taken and
written notice thereof is furnished to the Participant, and/or (b) prior to the
second anniversary of a Change in Control if such action is taken (1) on the day
of or subsequent to the Change in Control, (2) prior
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to the Change in Control, but at the request of a third party participating
directly or indirectly in the Change in Control, or (3) otherwise in connection
with or in anticipation of the Change in Control.
14. Successors and Beneficiaries.
(a) Successors and Assigns of Company. The Company shall require any
successor or assignee, whether direct or indirect, by purchase, merger,
consolidation or otherwise, to all or substantially all the business or assets
of the Company, expressly and unconditionally to assume and agree to perform or
cause to be performed the Company's obligations under the Plan and each Plan
Certificate 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. In any
such event, the term "Company," as used in the Plan and each Plan Certificate,
shall mean the Company, as defined above and any such successor or assignee.
(b) Beneficiary of Deceased Participant. For the purposes hereof, a
deceased Participant's beneficiary will be the person or persons designated as
such in a written Plan beneficiary designation filed with the Committee, which
may be revoked or revised in the same manner at any time prior to the
Participant's death. In the absence of a properly filed written Plan beneficiary
designation or if no designated beneficiary survives the Participant, the
deceased Participant's estate will be deemed to be the Participant's beneficiary
hereunder.
15. Miscellaneous.
(a) Nonassignability. With the exception of a Participant's beneficiary
designation, no Participant or beneficiary may pledge, transfer or assign in any
way his or her right to receive payments under the Plan, and any attempted
pledge, transfer or assignment shall be void and of no force or effect.
(b) Legal Fees to Enforce Rights after a Change in Control. If,
following a Change in Control, the Company fails to comply with any of its
obligations under the Plan or any Plan Certificate or the Company takes any
action to declare the Plan or any Plan Certificate void or unenforceable or
institutes any litigation or other legal action designed to deny, diminish or to
recover from any Participant (or a deceased Participant's beneficiary) the
payments and benefits intended to be provided, then such Participant (or
beneficiary, as the case may be) shall be entitled to retain counsel of his or
her choice at the expense of the Company to represent such Participant (or
beneficiary, as the case may be) in connection with the good faith initiation or
defense of any litigation or other legal action, whether by or against the
Company or any director, officer, stockholder or other person affiliated with
the Company or any successor thereto in any jurisdiction.
(c) Not a Contract of Employment. The terms and conditions of the Plan
shall not be deemed to constitute a contract of employment between any
Participant and the Company or any of its Affiliates. Nothing in the Plan shall
be deemed to give any employee the right to be retained in the employ or other
service of the Company or any of its Affiliates or to interfere with the right
of the Company or any of its Affiliates to terminate his or her employment at
any time.
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(d) Governing Law. Subject to the applicable provisions of ERISA, the
Plan shall be governed by the laws of the State of Delaware, excluding its
conflict of law rules.
(e) Withholding. The Company and its Affiliates may withhold from any
and all amounts payable under the Plan such federal, state and local taxes as
may be required to be withheld pursuant to any applicable law or regulation.
PULITZER INC.
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