MYERS INDUSTRIES, INC. Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On
Under the Severance Plan, if a Covered Officer's employment is terminated by the Company other than for Cause or is terminated by the Covered Officer for Good Reason, but not in connection with a Change in Control, each as defined in the Severance Plan, and provided the Covered Officer delivers an effective release of claims as required, the Covered Officer will be entitled to the following severance benefits (the "Severance Benefits"):
(a) a single lump sum payment in an amount equal to any accrued obligations, plus
(1) for the President/Chief Executive Officer, one and one-half(1.5) times his or her Base Salary in effect on the Termination Date (or, if such Base Salary has decreased during the one-year period ending on the Termination Date, at the highest rate in effect during such period);
(2) for a Covered Officer other than the President/Chief Executive Officer, one (1) times his or her Base Salary in effect on the Termination Date (or if such Base Salary has decreased during the one-year period ending on the Termination Date, at the highest rate in effect during such period); or
(3) for a Covered Officer other than the President/Chief Executive Officer who had entered into a Severance and Change in Control Agreement with the Company that was effective on the day preceding the Effective Date but was superseded by this Plan, one (1) times (A) his or her Base Salary in effect on the Termination Date (or if such Base Salary has decreased during the one-year period ending on the Termination Date, at the highest rate in effect during such period), and (B), his or her Target Bonus, plus the pro rata portion of the Target Bonus for the period commencing on the first day of the Fiscal Year in which the employment of the Covered Officer is terminated and ending on the Termination Date;
(b) health care coverage, disability coverage, life insurance coverage, and outplacement services for one year;
(c) any other amounts or benefits provided under any Company benefit plan, policy, practice, program, contract or arrangement; and
(d) all outstanding stock options, restricted stock, restricted stock units, or similar awards granted to the Covered Officer under the Company's long-term incentive plan or any successor or replacement equity-based incentive plan will be subject to the terms and conditions of the respective award or option agreement.
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If within 90 days prior to a Change in Control or 180 days following a Change in Control, a Covered Officer's employment is terminated by the Company without Cause or by the Covered Officer for Good Reason, and provided that the Covered Officer delivers an effective release of claims as required, the Covered Officer will be entitled to the following payments and benefits (the "Change in Control Benefits") in lieu of Severance Benefits:
(a) a single lump sum payment in an amount equal to any accrued obligations plus the pro rata portion of the Covered Officer's target annual bonus for the period commencing on the first day of the fiscal year in which the employment of the Covered Officer is terminated and ending on the termination date, plus
(1) for the President/Chief Executive Officer, two (2) times (A) his or her Base Salary in effect on the Termination Date (or, if such Base Salary has decreased during the one (1) year period ending on the Termination Date, at the highest rate in effect during such period), plus (B) his or her Target Bonus;
(2) for a Covered Officer other than the President/Chief Executive Officer or a Group President, one and one-half (1.5) times (A) his or her Base Salary in effect on the Termination Date (or if such Base Salary has decreased during the one (1) year period ending on the Termination Date, at the highest rate in effect during such period), plus (B) his or her Target Bonus;
(3) for a Covered Officer other than the President/Chief Executive Officer or a Group President who had entered into a Change in Control Agreement with the Company that was effective on the day preceding the Effective Date but was superseded by this Plan, two (2) times (X) his or her Base Salary in effect on the Termination Date (or if such Base Salary has decreased during the one (1) year period ending on the Termination Date, at the highest rate in effect during such period), plus (Y) his or her Target Bonus; or
(4) for a Group President, one (1) times (A) his or her Base Salary in effect on the Termination Date (or if such Base Salary has decreased during the one (1) year period ending on the Termination Date, at the highest rate in effect during such period), plus (B) his or her Target Bonus.
(b) health care coverage for up to 18 months, disability and life insurance coverage for one year, and outplacement services for one year;
(c) any other amounts or benefits provided under any Company benefit plan, policy, practice, program, contract or arrangement; and
(d) all outstanding stock options, restricted stock, restricted stock units, or similar awards granted to the Covered Officer under the Company's long-term incentive plan or any successor or replacement equity-based incentive plan will be subject to the terms and conditions of the respective award or option agreement.
Payment of any Severance Benefits or Change in Control Benefits under the Severance Plan is contingent upon a Covered Officer's compliance with the Non-Competition and Non-Disclosure Agreement between the Company and the Covered Officer, the continued effectiveness of which is a condition to participation in the Severance Plan. Each Covered Officer acknowledges and reaffirms that during the term of the Severance Plan and for the period set forth in the Non-Competition and Non-Disclosure Agreement, the Covered Officer shall not compete with the Company under the terms more fully set forth in the Non-Competition and Non-Disclosure Agreement.
If amounts payable to a Covered Officer, either alone or together with other payments and benefits that the Covered Officer has the right to receive from the Company or any of its Affiliates, would constitute a "parachute payment" under Section 280G of the Internal Revenue Code of 1986, as amended ("Code"), then such payments and benefits shall be reduced by the amount, if any, that is the minimum necessary to result in no portion of the payments or benefits constituting a parachute payment under Section 280G of the Code. To the extent that the Covered Officer has been employed in the Covered Officer's current position for less than three full calendar years, such payments and benefits shall be reduced as so described only if the Company's then
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current independent registered public accounting firm determines that such reduction would result in the Covered Officer retaining, on an after-tax basis (taking into account federal, state and local income taxes, employment, social security and Medicare taxes, the imposition of the excise tax imposed by Section 4999 of Code or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest or penalties, are collectively referred to as the "Excise Tax"), and all other taxes, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied (or is likely to apply) to the Covered Officer's taxable income for the tax year in which the transaction which causes the application of Section 280G of the Code occurs, or such other rate(s) as the accounting firm determines to be likely to apply to the Covered Officer in the relevant tax year(s) in which any of the payments and benefits is expected to be made taxable) a larger amount as a result of such reduction than the Covered Officer would receive, on a similar after tax basis, if the Covered Officer received all of such payments and benefits.
The foregoing summary of the Severance Plan is not complete and is qualified in its entirety by reference to the full and complete terms of the Severance Plan, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number Description
10.1 Senior Officer Severance Plan
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