Document



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of Earliest Event Reported): December 13, 2018
 
 
REXNORD CORPORATION
(Exact name of registrant as specified in its charter)
 
Delaware
 
20-5197013
(State or Other Jurisdiction of Incorporation or Organization)
 
(I.R.S. Employer Identification No.)
 
 
 
511 West Freshwater Way, Milwaukee, Wisconsin
 
53204
(Address of Principal Executive Offices)
 
(Zip Code)

(414) 643-3739
(Registrant's telephone number, including area code)


 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o






Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers.

On December 13, 2018, Rexnord Corporation (the “Company”) entered into a letter agreement with Todd A. Adams, its President and Chief Executive Officer, providing for his continued employment with the Company (the “Letter Agreement”). The Letter Agreement replaces the Employment Agreement, dated November 9, 2012, as amended August 6, 2015, between Mr. Adams and the Company (the “Former Employment Agreement”).
The Letter Agreement provides for a three-year term through December 13, 2021, after which it will automatically renew for successive one-year terms unless, at least 90 days prior to the expiration of the then-current term, either party provides notice of an intent to terminate the Letter Agreement upon its then-current expiration date. The Letter Agreement requires the Company’s Board of Directors to continue to nominate Mr. Adams for re-election as a director so long as he continues to serve as the Company’s President and Chief Executive Officer. Mr. Adams’ base salary remains $965,000, and he continues to be eligible to participate in the Company’s incentive plans, with any and all amounts payable under the Letter Agreement and such plans subject to the Company’s recoupment, clawback or similar policies as may be in effect from time to time.
The other terms of the Letter Agreement are substantially similar to those under the Former Employment Agreement; however, severance and change in control benefits, which continue to provide for longer benefits and restriction periods than for other executive officers, are now payable under the Company’s Executive Severance Plan (the “Severance Plan”) and the Company’s Executive Change in Control Plan (the “Change in Control Plan”). Severance benefits will now be equal to the sum of his current base salary plus his annual target bonus multiplied by two, payable in installments over a 24-month period and he is eligible for continued participation, with related employer contributions, in the Company’s medical plans for 24 months. Post-employment restrictive obligations also continue for 24 months following termination of employment. In addition, he will continue to be eligible to receive any unpaid bonus earned with respect to any fiscal year ending on or prior to the date of termination and a pro-rated annual bonus for the fiscal year in which the termination occurs. Benefits payable on a change in control are unchanged; however, as discussed below, the accelerated vesting provisions applicable to long-term incentive awards in the Change in Control Plan were amended, with such change applicable to Mr. Adams and all other participants in the Change in Control Plan. For a discussion of severance and change in control benefits payable to Mr. Adams, and the Severance Plan and Change in Control Plan generally, please see “Executive Compensation-Employment-Related Agreements and Potential Payments upon Termination or Change in Control” in the definitive Proxy Statement for the Company’s fiscal 2019 annual meeting of stockholders, which was filed with the Securities and Exchange Commission on June 11, 2018. Consistent with the Former Employment Agreement, the Letter Agreement provides that the definition of “Good Reason” (in the context of a voluntary termination) in the Change in Control Plan will, if applied to Mr. Adams, also includes a failure by the Company to re-elect him as a member of the Company’s Board of Directors; such change only applies in the case of Mr. Adams.
The foregoing description of the Letter Agreement and related benefits does not purport to be complete and is qualified in its entirety by reference to the full text of the Letter Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Also on December 13, 2018, the Company’s Board of Directors amended the accelerated vesting provisions in the Change in Control Plan to provide that, in the event of a qualifying termination, unvested long-term incentive awards that vest and are earned depending on the attainment of certain performance criteria would vest and be earned at the greater of the (i) target performance level or (ii) actual performance measured through the date of the qualifying termination or, in the event of a qualifying termination prior to a change in control, the date of the change in control. The Change in Control Plan previously provided that such awards would vest at the target performance level. A copy of the Change in Control Plan, as amended, is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated by reference herein.






Item  9.01
Exhibits.

(d) Exhibits
 
Exhibit  No.
Description
10.1
10.2

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Rexnord Corporation has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized this 14th day of December, 2018.
 
 
 
REXNORD CORPORATION
 
 
 
By:
/S/    Patricia M. Whaley
 
Patricia M. Whaley
 
 
Vice President, General Counsel and Secretary
 



exhibit101adamsletteragr
Todd A. Adams December 13, 2018 Dear Todd, On behalf of the Board of Directors, the Company is pleased to provide you this letter agreement (“Letter Agreement”) to set forth certain terms and conditions relating to your continued employment with Rexnord Corporation (the "Company" or “Employer”) and your right to participate in certain benefit plans of the Employer. This Letter Agreement is effective on December 13, 2018 (the “Effective Date”) and the initial term will end on the third anniversary of the Effective Date (“Initial Term”). The term of this Letter Agreement shall be automatically extended thereafter for successive one (1) year periods unless, at least ninety (90) days prior to the end of the Initial Term or the then current succeeding one (1)-year extended term of this Letter Agreement, you or the Company has notified the other that the term hereunder shall terminate upon its expiration date. Position You will continue to serve as the President and Chief Executive Officer of the Company and shall report exclusively to the Company’s Board of Directors (the “Board”). You are expected to use your best efforts to perform your duties faithfully and efficiently, and to devote substantially all of your business time to the performance of your duties for the Company. However, such requirement will not prevent you from (1) participating in charitable, civic, educational, professional, community or industry affairs, or with prior approval of the Board, serving on the board of directors or advisory boards of other companies, and (2) managing your and your family’s personal investments, so long as such activities do not materially interfere with the performance of your duties for the Company. If the Board notifies you in writing that it has determined, in its good faith judgment, that your service on any board of directors or advisory board conflicts with your fiduciary duty to the Company (or creates any appearance thereof), then you shall resign from such other board as soon as reasonably practicable, considering any fiduciary duty that you owe to such other company. The Board shall nominate you for re-election as a member of the Board as long as you continue to serve as the President and Chief Executive Officer of the Company. Base Salary In consideration of your services, your salary will be $965,000 per year, subject to periodic review and may be increased from time to time by the Board (or a committee thereof), payable in accordance with the standard payroll practices of the Employer and subject to all applicable withholdings and deductions as required by law. The base salary as it may be increased from time to time shall constitute “Base Salary” for purposes of this Letter Agreement. Page 1 of 8


 
Annual Bonus You will continue to be eligible to participate in the Company's Management Incentive Compensation Plan (the "MICP") or such other annual bonus plan that the Employer establishes from time to time, in accordance with the terms of the MICP or such other plan. Your annual target bonus, measured against performance criteria to be determined by the Board (or a committee thereof), will be 125% of Base Salary with a maximum bonus opportunity of 250% of Base Salary, subject to periodic review and may be increased from time to time by the Board (or a committee thereof), The annual target bonus as it may be increased from time to time shall constitute “Annual Target Bonus” for purposes of this Letter Agreement. Equity Grants You will continue to be eligible to participate in the Rexnord Corporation Performance Incentive Plan or other such long-term incentive plans established by the Company. Your annual award will be determined in accordance with such plans and is contemplated to be comprised of a potential combination of various types of equity grants, such as options, restricted stock units or performance stock units. Any equity grants that you receive will be governed by the terms of the plan under which they are granted and the applicable grant agreement. Benefits You shall continue to be entitled to executive benefits and arrangements, including but not limited to group medical, dental and vision plans, wellness plans, disability benefit plans or programs, life insurance plans, retirement plans, deferred compensation plans, and company-provided automobiles or automobile allowances, subject to the terms and conditions of such plans and programs and on terms and conditions no less favorable than any other senior executive of the Company. You will be entitled to paid vacation in accordance with the Employer's policies in effect from time to time but in no event less than four (4) weeks per year (as pro-rated for partial years of employment). Stock Ownership Requirements You will be subject to the Rexnord Executive Officer Stock Ownership Guidelines or any successor stock ownership guidelines applicable to executives that are in place from time to time, as approved by the Board. Death or Disability Benefits If your employment is terminated due to death or Disability (as defined under the Company’s then-current long- term disability plan in which you participate), then the Company shall pay or provide you (or the legal representative of your estate in the case of your death), in addition to payment for any accrued but unpaid base salary, unused vacation, and unreimbursed expenses (collectively, “Accrued Obligations”), and any insurance proceeds or benefits you are entitled to under Company benefit plans, with: (1) any unpaid bonus earned with respect to any fiscal year ending on or preceding the date of termination, payable when bonuses are paid generally to senior executives for such year (“Accrued Bonus”); Page 2 of 8


 
(2) a pro-rated annual bonus for the fiscal year in which such termination occurs, the amount of which shall be based on actual performance under the applicable bonus plan (for this purpose determined at fiscal year-end, by treating Company financial performance goals for such fiscal year as the only performance goals applicable to you and without any exercise of negative discretion by the Committee) and a fraction, the numerator of which is the number of days elapsed during the performance year through the date of termination and the denominator of which is 365, which pro-rated bonus shall be paid when bonuses are paid generally to senior executives for such year ("Pro-Rated Bonus"); and (3) all unvested options and long-term incentive awards granted to you through the date of termination shall vest and any such vested awards granted shall be exercisable, in accordance with the terms of the plan under which they are granted and the applicable award agreement. Severance and Change in Control Benefits You are entitled to participate in the Rexnord Corporation Executive Severance Plan, as in effect on the date of this Letter Agreement (the "Severance Plan") and the Rexnord Corporation Executive Change in Control Plan, as in effect on the date of this Letter Agreement (the "Change in Control Plan") upon the terms and conditions of such plans as in effect on the date of this Letter Agreement, except as otherwise provided below. Severance Plan Upon your Qualifying Termination (as defined in the Severance Plan), you will receive salary continuation and subsidized COBRA benefits in accordance with the terms of such Severance Plan, except that:  Your Severance Pay will equal the product of (A) the sum of (1) your then current Base Salary plus (2) your Annual Target Bonus (B) multiplied by two (2), and will be paid over a period of 24 months;  Your Subsidized COBRA will continue for a period of 24 months;  The Restricted Services Obligation in Section 6.2, the Customer Non-Solicitation covenant in Section 6.3, and the Non-Solicitation of Employees covenant in Section 6.4 shall each continue for a period of 24 months after termination of employment;  Subsection (d) in the definition of Cause in Section 2.3, as it applies to you, shall be revised to read as follows: “An Executive's breach of any representation, warranty or covenant under this Plan, an award agreement or an employment agreement or other agreement with an Employer.” In addition to the benefits provided under the Severance Plan, upon a Qualifying Termination (as defined in the Severance Plan), you will also be eligible to receive payment for (1) any Accrued Obligations, (2) any Accrued Bonus, and (3) your Pro-Rated Bonus for the year of termination. In addition, your vested options shall continue to be exercisable until at least the earlier of (x) one year after the date of termination and (y) the expiration of the original scheduled term of such options. Change in Control Plan Page 3 of 8


 
Upon your Qualifying Termination (as defined in the Change in Control Plan), you will receive the Base Salary continuation benefit and accelerated equity award vesting in accordance with the terms of such Change in Control Plan, except that:  Your CIC Severance Pay will equal the product of (A) the sum of (1) your then current Base Salary plus (2) your Annual Target Bonus (B) multiplied by two (2);  Your Subsidized COBRA will continue for a period of 24 months;  The Restricted Services Obligation in Section 5.2, the Customer Non-Solicitation covenant in Section 5.3, and the Non-Solicitation of Employees covenant in Section 5.4 shall continue for a period of two (2) years after termination of employment;  The definition of Good Reason, as it applies to you, shall be revised by inserting the following text after the end of subsection (c): (d) Failure by the Company to elect or re-elect you as a member of the Board;  Subsection (d) in the definition of Cause in Section 2.4, as it applies to you, shall be revised to read as follows: “An Executive's breach of any representation, warranty or covenant under this Plan, an award agreement or an employment agreement or other agreement with an Employer.” In addition to the benefits provided under the Change in Control Plan, upon a Qualifying Termination (as defined in the Change in Control Plan), you will also be eligible to receive payment for (1) any Accrued Obligations, (2) any Accrued Bonus, and (3) your Pro-Rated Bonus for the year of termination. Conditions to Receive Termination Benefits Your right to receive any of the benefits provided hereunder upon termination of employment for any reason (other than the Accrued Obligations), including but not limited to any benefits provided under the Severance Plan and Change in Control Plan, shall be subject to the terms and conditions set forth in the Severance Plan and Change in Control Plan, respectively, except that the General Release shall be substantially in the form of Exhibit A. No Duplication of Benefits This Letter Agreement replaces any agreement that you have with the Employer relating to your employment or any agreement or plan providing severance or change in control benefits, including but not limited to any employment agreement, any retention and change in control agreement, the Rexnord LLC Severance Pay Plan, the Employment Agreement dated November 9, 2012 and the Amendment to Employment Agreement dated August 6, 2015 between you and the Company. Page 4 of 8


 
Executive Covenants You will be subject to the Rexnord Code of Business Conduct and Ethics (the “Code”) and a Confidentiality Agreement, both of which you signed when your employment began. Among other things, the Code and Confidentiality Agreement require you to safeguard confidential information such as information regarding product design, manufacturing processes, supply sources, customer identification, pricing, sales distribution and marketing and prohibit you from soliciting customer or employees for a period of two years following your departure from the Employer. In addition, if you have received an equity grant, these restrictive obligations, as well as a non-compete covenant, are required by the Equity Award Agreement(s) that you executed in consideration for the equity grants that you received. Finally, you will be subject to the same restrictive obligations by virtue of your participation in the Severance Plan and Change in Control Plan. Cooperation Following termination of your employment for any reason, you shall, upon reasonable advance notice, and to the extent it does not interfere with previously scheduled travel plans and does not unreasonably interfere with your other business activities or employment obligations, assist and cooperate with the Company with regard to any matter or project in which you were involved during your employment, including any litigation. The Company shall compensate you for reasonable expenses incurred in connection with such cooperation and assistance. Clawback Any amounts payable hereunder, including amounts payable under this letter or the plans referred to herein, are subject to the terms of the Company's recoupment, clawback or similar policies as may be in effect from time to time, as approved by the Board, as well as any similar provisions of applicable law, any of which could in certain circumstances require repayment or forfeiture of any cash or other property received under this letter. Assignment of Letter Agreement The Company shall assign this Letter Agreement to any successor to all or substantially all of the business or assets of the Company provided that the Company shall require such successor to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place and shall deliver a copy of such assignment to you. Governing Law This offer letter shall be governed by the laws of Wisconsin, without regard to conflict of law principles. Page 5 of 8


 
Contingencies This Letter Agreement is contingent upon your acceptance of the below terms. This Letter Agreement will be withdrawn if this condition is not satisfied. Sincerely, /s/ George Powers George Powers On behalf of Rexnord Acceptance of Terms of this Letter Agreement I have read, understood and accept all the terms of this Letter Agreement as set forth above and the terms of the Severance Plan and the Change in Control Plan, as attached hereto. I have not relied on any agreements or representations, express or implied, that are not set forth expressly in the foregoing Letter Agreement or the Severance Plan and Change in Control Plan, and this Letter Agreement supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to the subject matter of this Letter Agreement. I hereby consent to the terms of the above Letter Agreement, the Severance Plan and the Change in Control Plan, including but not limited to the confidentiality, nonsolicitation, noncompetition, nondisparagement and other similar terms of such Plans, and to the termination of my participation in any other severance or change in control plans of the Employer or any employment, severance or change in control agreement with the Employer. I also hereby consent to the termination of the Employment Agreement dated November 9, 2012 and the Amendment to Employment Agreement dated August 6, 2015 between me and the Company effective as of the date set forth below. Todd A. Adams Signed /s/ Todd A. Adams Date December 13, 2018 Page 6 of 8


 
EXHIBIT A GENERAL RELEASE OF ALL CLAIMS 1. For and in consideration of the promises made in the Letter Agreement between Rexnord Corporation (“Company”) and the undersigned “(Executive”) dated December 13, 2018 (“Letter Agreement”), the adequacy of which is hereby acknowledged, Executive , for himself, his heirs, administrators, legal representatives, executors, successors, assigns, and all other persons claiming through Executive, if any (collectively, “Releasers”), does hereby release, waive, and forever discharge the Company, the Company’s subsidiaries, parents, affiliates, related organizations, employees, officers, directors, attorneys, successors, and assigns (collectively, the “Releasees”) from, and does fully waive any obligations of Releasees to Releasers for, any and all liability, actions, charges, causes of action, demands, damages, or claims for relief, remuneration, sums of money, accounts or expenses (including attorneys’ fees and costs) of any kind whatsoever, whether known or unknown or contingent or absolute, which heretofore has been or which hereafter may be suffered or sustained, directly or indirectly, by Releasers in consequence of, arising out of, or in any way relating to Executive’s employment with the Company or any of its affiliates or the termination of Executive’s employment. The foregoing release and discharge, waiver and covenant not to sue includes, but is not limited to, all claims and any obligations or causes of action arising from such claims, under common law including wrongful or retaliatory discharge, breach of contract (including but not limited to any claims under the Employment Agreement between the Company and Executive, dated November 9, 2012, as amended by the Amendment to Employment Agreement dated August 6, 2015, as well as any claims under the Letter Agreement, and any claims under any stock option and restricted stock units agreements between Executive and the Company) and any action arising in tort including libel, slander, defamation or intentional infliction of emotional distress, and claims under any federal, state or local statute including Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1866 and 1871 (42 U.S.C. § 1981), the National Labor Relations Act, the Age Discrimination in Employment Act (ADEA), the Fair Labor Standards Act, the Americans with Disabilities Act of 1990, the Rehabilitation Act of 1973,), or the discrimination or employment laws of any state or municipality, or any claims under any express or implied contract which Releasers may claim existed with Releasees. This release and waiver does not apply to any claims or rights that may arise after the date Executive signs this General Release. The foregoing release does not apply to any claims of indemnification under a separate indemnification agreement with the Company or rights of coverage under directors and officers liability insurance. 2. Excluded from this release and waiver are any claims which cannot be waived by law, including but not limited to the right to participate in an investigation conducted by certain government agencies. Executive does, however, waive Executive’s right to any monetary recovery should any agency (such as the Equal Employment Opportunity Commission) pursue any claims on Executive’s behalf. Executive represents and warrants that Executive has not filed any complaint, charge, or lawsuit against the Releasees with any government agency or any court. 3. Executive agrees never to sue Releasees in any forum for any claim covered by the above waiver and release language, except that Executive may bring a claim under the ADEA to challenge this General Release or as otherwise provided in this General Release. If Executive violates this Page 7 of 8


 
General Release by suing Releasees, other than under the ADEA or as otherwise set forth in Section 1 hereof, Executive shall be liable to the Company for its reasonable attorneys’ fees and other litigation costs incurred in defending against such a suit. Nothing in this General Release is intended to reflect any party’s belief that Executive’s waiver of claims under ADEA is invalid or unenforceable, it being the interest of the parties that such claims are waived. 4. Executive acknowledges, agrees and affirms that he is subject to certain post-employment covenants, which covenants survive the termination of his employment and the execution of this General Release. 5. Executive acknowledges and recites that: (a) Executive has executed this General Release knowingly and voluntarily; (b) Executive has read and understands this General Release in its entirety; (c) Executive has been advised and directed orally and in writing (and this subparagraph (c) constitutes such written direction) to seek legal counsel and any other advice he wishes with respect to the terms of this General Release before executing it; (d) Executive’s execution of this General Release has not been coerced by any employee or agent of the Company; and (e) Executive has been offered twenty-one (21) calendar days after receipt of this General Release to consider its terms before executing it. 6. This General Release shall be governed by the internal laws (and not the choice of laws) of the State of Delaware, except for the application of pre-emptive Federal law. 7. Executive shall have seven (7) days from the date hereof to revoke this General Release by providing written notice of the revocation to the Company, by hand delivering, faxing or mailing notice to the Company to the attention of the General Counsel, upon which revocation this General Release shall be unenforceable and null and void and in the absence of such revocation this General Release shall be binding and irrevocable by Executive. PLEASE READ THIS AGREEMENT CAREFULLY. IT CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. Date: _________________, 20___ EXECUTIVE __________________________________________ Todd A. Adams Page 8 of 8


 
exhibit102executivechang
REXNORD CORPORATION EXECUTIVE CHANGE IN CONTROL PLAN Effective May 18, 2016 As amended through December 13, 2018 4811-1906-7992.2


 
Table of Contents Page ARTICLE 1 PURPOSE OF THE PLAN .............................................................................. 1 ARTICLE 2 DEFINITIONS ................................................................................................. 1 2.1 Accelerated Vesting ............................................................................................... 1 2.2 Base Salary............................................................................................................. 1 2.3 Board ...................................................................................................................... 1 2.4 Cause ...................................................................................................................... 1 2.5 Change in Control .................................................................................................. 2 2.6 CIC Severance Pay ................................................................................................ 3 2.7 Code ....................................................................................................................... 3 2.8 Company ................................................................................................................ 3 2.9 Disability ................................................................................................................ 3 2.10 Eligible Executive .................................................................................................. 3 2.11 Employer ................................................................................................................ 3 2.12 Executive................................................................................................................ 3 2.13 Good Reason .......................................................................................................... 3 2.14 Plan ........................................................................................................................ 4 2.15 Plan Administrator ................................................................................................. 4 2.16 Protection Period .................................................................................................... 4 2.17 Qualifying Termination ......................................................................................... 4 2.18 Subsidized COBRA ............................................................................................... 4 ARTICLE 3 ELIGIBILITY AND BENEFITS ..................................................................... 4 3.1 Eligibility for Benefits ........................................................................................... 4 3.2 CIC Severance Payment ........................................................................................ 4 3.3 Subsidized COBRA Coverage ............................................................................... 5 3.4 Accelerated Vesting ............................................................................................... 5 3.5 Death of Executive ................................................................................................. 6 3.6 Compliance with Code Section 409A .................................................................... 6 3.7 No Duplication of Benefits .................................................................................... 7 ARTICLE 4 CONDITIONS FOR PAYMENT AND RIGHT TO TERMINATE CIC SEVERANCE BENEFITS ....................................................................... 7 4.1 Conditions for Payment of Benefits ....................................................................... 7 -i- 4811-1906-7992.2


 
Table of Contents (continued) Page 4.2 Right to Terminate Severance Benefits ................................................................. 8 4.3 Clawback................................................................................................................ 8 ARTICLE 5 EXECUTIVE COVENANTS .......................................................................... 8 5.1 Reasonableness of Restrictions .............................................................................. 8 5.2 Restricted Services Obligation ............................................................................... 9 5.3 Customer Non-Solicitation .................................................................................... 9 5.4 Non-Solicitation of Employees .............................................................................. 9 5.5 Non-Disparagement ............................................................................................... 9 5.6 Non-Disclosure of Confidential Information ....................................................... 10 5.7 Return of Company Property ............................................................................... 10 5.8 Injunctive Relief................................................................................................... 10 ARTICLE 6 GENERAL RULES ....................................................................................... 11 6.1 Right to Withhold Taxes ...................................................................................... 11 6.2 Assignment .......................................................................................................... 11 6.3 Unfunded Plan ..................................................................................................... 11 6.4 Code Section 409A .............................................................................................. 11 6.5 Governing Laws; Other Obligations .................................................................... 11 ARTICLE 7 AMENDMENT AND TERMINATION ....................................................... 11 ARTICLE 8 ADMINISTRATION ..................................................................................... 13 8.1 Powers and Duties................................................................................................ 13 8.2 Finality of Action ................................................................................................. 13 8.3 Claim Procedure................................................................................................... 13 -ii- 4811-1906-7992.2


 
Rexnord Corporation Executive Change in Control Plan ARTICLE 1 PURPOSE OF THE PLAN The Rexnord Corporation Executive Change in Control Plan (the “Plan”) outlines certain benefits available to eligible Executives whose employment with the Company is involuntarily terminated in connection with a Change in Control under the conditions described below. The Board considers the maintenance of a sound management team to be essential to protecting and enhancing the best interests of the Company and its stockholders. The Company recognizes that the possibility of a Change in Control may exist from time to time, and that this possibility, and the uncertainty and questions it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its stockholders. Accordingly, the Board has determined that appropriate steps should be taken to encourage the continued attention and dedication of the Executives to their assigned duties without the distraction that may arise from the possibility of a Change in Control. ARTICLE 2 DEFINITIONS As used in the Plan, the following words and phrases shall have the following respective meanings: 2.1 Accelerated Vesting is defined in Section 3.4 of the Plan. 2.2 Base Salary means an Eligible Executive’s annual base salary in effect on the date of his or her Qualifying Termination. 2.3 Board means the Board of Directors of the Company. 2.4 Cause means any of the following: (a) An Executive’s willful and continued failure to perform substantially his or her duties owed to the Employer after a written demand for substantial performance is delivered to the Executive specifically identifying the nature of such unacceptable performance and is not cured by the Executive within a reasonable period, not to exceed 30 days; (b) An Executive is convicted of (or pleads guilty or no contest to) a felony or any crime involving moral turpitude; (c) An Executive has engaged in conduct that constitutes gross misconduct in the performance of his or her employment duties; or (d) An Executive's breach of any representation, warranty or covenant under this Plan, an award agreement or an employment agreement or other agreement or arrangement with an Employer. 4811-1906-7992.2


 
An act or omission by an Executive shall not be “willful” if conducted in good faith and with the Executive’s reasonable belief that such conduct is in the best interests of the Employer. 2.5 Change in Control means the occurrence of any of the following events: (a) 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 more than 50% of either (i) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) 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 purposes of this subsection (a), the following acquisitions shall not constitute a Change in Control: (1) any acquisition directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (1) and (2) of subsection (c) of this definition; (b) The cessation for any reason of individuals who, as of May 18, 2016, constitute the Board (the “Incumbent Board”) to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority 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; (c) The consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following such Business Combination, (1) 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 Business Combination beneficially own, directly or indirectly, more than 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 Business Combination (including, without limitation, a corporation which as a 4811-1906-7992.2


 
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 Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, and (2) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination 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 Business Combination; or (d) The approval by the stockholders of the Company of a complete liquidation or dissolution of the Company. 2.6 CIC Severance Pay is defined in Section 3.2 of the Plan. 2.7 Code means the Internal Revenue Code of 1986, as amended. 2.8 Company means Rexnord Corporation. 2.9 Disability means disability as defined under the Employer's then-current long term disability insurance plan in which the Executive participates. 2.10 Eligible Executive is defined in Section 3.1 of this Plan. 2.11 Employer means Rexnord Corporation or any of its subsidiaries that employs an Eligible Executive on the applicable date. 2.12 Executive means the Company's officers as designated in accordance with Rule 16a-1(f) under the Securities Exchange Act of 1934, members of the Company's Executive Council and any other executive, officer or key employee of an Employer designed by the Chief Executive Officer of the Company as eligible to participate in the Plan. 2.13 Good Reason means, without the express written consent of an Executive, the occurrence of any of the following events during a Protection Period: (a) An Executive's Base Salary or target annual bonus opportunity under the Company's Management Incentive Compensation Plan or other similar annual bonus plan of the Company or any other Employer is materially reduced; (b) An Executive’s duties or responsibilities are negatively and materially changed in a manner inconsistent with the Executive’s position (including status, offices, titles, and reporting responsibilities) or authority; or (c) The Company requires an Executive's principal office to be relocated more than 50 miles from its location as of the date immediate preceding a Change in Control. 4811-1906-7992.2


 
Notwithstanding the foregoing, Good Reason shall not exist unless the Executive provides the Board of Directors of the Company not less than 30 nor more than 90 days’ written notice, with specificity, of the grounds constituting Good Reason and an opportunity within such notice period for the Company to cure such grounds, and the Company fails to cure such grounds within the prescribed time period. Such notice shall be given within 90 days following the initial existence of such grounds constituting Good Reason for such notice and subsequent termination, if not so cured above, to be effective. 2.14 Plan means this Rexnord Corporation Executive Change in Control Plan. 2.15 Plan Administrator means the Compensation Committee of the Board or such other person or committee appointed from time to time by the Plan Administrator to administer the Plan. 2.16 Protection Period means the period commencing 90 days prior to the occurrence of a Change in Control and ending on the second anniversary of the date of the Change in Control. 2.17 Qualifying Termination means a termination of an Executive's employment with all Employers (i) involuntarily by the Company without Cause (and other than due to his or her death or Disability) or (ii) voluntarily by an Executive for Good Reason, and in either case only during a Protection Period. 2.18 Subsidized COBRA is defined in Section 3.3 of the Plan. ARTICLE 3 ELIGIBILITY AND BENEFITS 3.1 Eligibility for Benefits. An Executive (i) whose employment with the Employer ends due to a Qualifying Termination and (ii) who satisfies the "Conditions for Payment of Benefits" set forth in Article 4 below (an "Eligible Executive") shall be eligible for the benefits described in this Article 3. For avoidance of doubt, an Executive shall not be eligible to receive the benefits under the Plan if the Company, in its sole discretion, determines that the Executive’s employment is terminated due to a resignation or voluntary termination of employment, due to the Executive's death or Disability, for Cause or for any reason other than a Qualifying Termination. Further, for the avoidance of doubt, the provisions of this Article 3 shall not apply unless a Change in Control actually occurs. 3.2 CIC Severance Payment. An Eligible Executive shall receive a lump sum payment in the aggregate amount equal to the product of the Eligible Executive's Base Salary multiplied by 1.5 ("CIC Severance Pay"). The CIC Severance Pay will be paid within 10 business days after Executive’s Qualifying Termination or, in the event of a termination of employment occurring prior to the Change in Control, within 10 business days after the Change in Control; provided, unless the Change of Control occurring on or preceding such termination also meets the requirements of Section 409A(a)(2)(A)(v) of the Code and Treasury Regulation Section 1.409A-3(i)(5) (or any successor provision) thereunder, the amount payable to an Eligible Executive under this Section 3.2 shall be paid to such Eligible Executive in equal bi-weekly payroll installments over a period of 18 months, not in a lump sum, to the extent 4811-1906-7992.2


 
necessary to avoid the application of Section 409A(a)(1)(A) and (B) (and in the event that CIC Severance Pay is payable in installments, each installment payment shall be treated as a separate payment within the meaning of Code Section 409A). 3.3 Subsidized COBRA Coverage. Subject to the Eligible Executive’s continued co- payment of premiums, an Eligible Executive may continue participation for 18 months in the medical, dental and vision coverage under the Company’s health benefits plan which covers the Eligible Executive (and his or her eligible dependents) upon the same terms and conditions (except for the requirement of the Eligible Executive’s continued employment) in effect for active employees of the Employer ("Subsidized COBRA"). In the event the Eligible Executive obtains other employment that offers substantially similar or more favorable medical benefits, such continuation of Subsidized COBRA coverage by the Employer under this subsection shall immediately cease. The continuation of health benefits under this Section shall reduce the period of coverage and count against the Eligible Executive’s right to healthcare continuation benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA"). 3.4 Accelerated Vesting. The following terms shall apply to an Eligible Executive's options and other long-term incentive awards: (a) All of an Eligible Executive’s unvested options and other long-term incentive awards granted to the Eligible Executive through the date of termination shall vest upon the Qualifying Termination or, in the event of a Qualifying Termination prior to the Change in Control, upon the Change in Control (and if such options and awards would otherwise be forfeited and the Qualifying Termination occurs during the 90-day period preceding the Change in Control in the absence of a Change in Control, such awards shall remain outstanding for up to 90 days solely for the purpose of determining whether Eligible Executive becomes entitled to vest in such awards pursuant to this Section but otherwise shall not be payable or exercisable following the date on which they would have otherwise been forfeited (unless the Change in Control subsequently occurs during such 90-day period)) (the vesting described in this clause (a) being referred to as "Accelerated Vesting"); (b) All of the Eligible Executive's options shall continue to be exercisable following a Qualifying Termination until the earlier of (i) one year after the date of termination and (ii) the expiration of the original scheduled term of such options; (c) Any limitation on the acceleration of the vesting of options (that would otherwise be applicable pursuant to Section 7.5 of Rexnord Corporation Performance Incentive Plan or otherwise) to reduce or eliminate the effects of Section 280G and/or Section 4999 of the Code, shall not be implemented unless the after-tax amount the Eligible Executive receives would be increased (as compared to the after-tax amount the Eligible Executive would receive in the absence of such limitation on acceleration of vesting), and in such event such limitation on acceleration of vesting 4811-1906-7992.2


 
shall be implemented to the minimum extent necessary to maximize the Eligible Executive's after-tax amount, provided that the Eligible Executive shall determine the order in which such limitation on acceleration of vesting is applied or, solely if required to comply with Section 409A of the Code, the option acceleration limitation shall be applied in the reverse order of scheduled vesting dates (i.e., the option tranche that would have vested first in the absence of a Change in Control will be the last tranche to have its acceleration limited); and (d) All of an Eligible Executive’s unvested long-term incentive awards where the number of shares that are earned upon vesting or the amount of payment varies dependent upon attainment of a performance level will be deemed earned at the greater of: (i) the “target” performance level (i.e., 100% payout) or (ii) the actual performance measured through the date of the Qualifying Termination or, in the event of a Qualifying Termination prior to the Change in Control, upon the Change in Control. 3.5 Death of Executive. In the event of an Eligible Executive's death prior to receipt of all CIC Severance Pay, the balance of such benefits shall be paid in a lump sum to the Eligible Executive’s spouse, if any, or if none, to the Eligible Executive's estate. 3.6 Compliance with Code Section 409A. Notwithstanding the foregoing or any provision of the Plan to the contrary, to the extent that the CIC Severance Pay hereunder constitutes a "deferral of compensation" under a "nonqualified deferred compensation plan" under Code Section 409A and regulations thereunder and does not qualify as a "short-term deferral" under Treasury Regulation Section 1.409A-1(b)(4), the following provisions shall apply: (a) If such CIC Severance Pay is payable on account of an Executive’s “involuntary separation from service” as defined in Treasury Regulation Section 1.409A-1(n) (an "Involuntary Separation from Service"), the Executive shall receive such amount of his or her CIC Severance Pay during the 6-month period immediately following the date of termination as equals the lesser of: (x) such CIC Severance Pay amount due Executive under Section 4.2 during such 6-month period or (y) two multiplied by the compensation limit in effect under Section 401(a)(17) of the Code for the calendar year in which the date of termination occurs and as otherwise provided under Treasury Regulation Section 1.409A-1(b)(9)(iii) and shall be entitled to such of his or her CIC Severance Pay benefits as satisfy the exception under Treasury Regulation Section 1.409A-1(b)(9)(v) (the “Limitation Amount”). (b) To the extent that, upon such Involuntary Separation from Service, the amount of CIC Severance Pay that would have been payable to the Executive during the 6-month period following the last day of his or her employment exceeds the Limitation Amount, such excess shall be paid on 4811-1906-7992.2


 
the first regular bi-weekly payroll date following the expiration of such 6- month period. (c) If the Company reasonably determines that such employment termination is not an Involuntary Separation from Service, all CIC Severance Pay that would have been payable to the Executive under the Plan during the 6- month period immediately following the date of termination, but for such determination, shall be paid on the first regular bi-weekly payroll date immediately following the expiration of such 6-month period following the date of termination. (d) Any CIC Severance Pay payments that are postponed shall accrue interest at an annual rate (compounded monthly) equal to the short-term applicable federal rate (as in effect under Section 1274(d) of the Code on the last day of the Executive’s employment) plus 100 basis points, which interest shall be paid on the first regular bi-weekly payroll date immediately following the expiration of the 6-month period following the date of termination. 3.7 No Duplication of Benefits. Notwithstanding the provisions of Article 3 or any other provision of the Plan to the contrary, any benefits provided under this Plan to an Eligible Executive shall be in lieu of any termination or severance payments or benefits for which such Executive may be eligible under any plan of or agreement or arrangement with an Employer, including but not limited to the Rexnord LLC Severance Pay Plan or the Rexnord Corporation Executive Severance Plan. For avoidance of doubt, upon a Qualifying Termination, an Executive shall only be entitled to CIC Severance Pay and Subsidized COBRA under this Plan and shall not be entitled to severance benefits, change in control benefits or subsidized COBRA under another plan of or arrangement with an Employer. ARTICLE 4 CONDITIONS FOR PAYMENT AND RIGHT TO TERMINATE CIC SEVERANCE BENEFITS 4.1 Conditions for Payment of Benefits. An Executive who has a Qualifying Termination will not be eligible for CIC Severance Pay, Subsidized COBRA or Accelerated Vesting unless the Company determines that the Executive has satisfied all of the following conditions: (a) Consent to and compliance with the "Executive Covenants" in Article 5 below; (b) Delivery, within 21 days after presentation thereof by the Company to the Executive, to the Company of an executed Agreement and general release (the “General Release”) in the form determined by the Company, and which may be revised by the Company in its sole discretion; and (c) Delivery to the Company of a resignation from all offices, directorships and fiduciary positions with the Company, its affiliates and employee benefit plans. 4811-1906-7992.2


 
Notwithstanding the due date of any benefits or payments under Article 3, any amounts due following a Qualifying Termination under the Plan shall not be payable until after the expiration of any statutory revocation period applicable to the General Release without Executive having revoked such General Release which must occur by the 53rd day after the later of the Executive’s termination of employment or the Change in Control (the “Release Condition”) and any such amounts shall commence on the later of the applicable due date or five (5) business days after the Release Condition is satisfied, provided that, if the 60-day period following termination of employment spans two calendar years, then any payments and benefits subject to Code Section 409A shall commence on the later of the applicable due date or on a date during that portion of such 60-day period occurring in the calendar year following the year of termination of employment, provided that the Release Condition is satisfied. 4.2 Right to Terminate Severance Benefits. Notwithstanding anything in this Plan to the contrary, the Company shall have the right to terminate the benefits payable under this Plan at any time in the event that the Company determines that a former Executive receiving benefits under this Plan has breached any of the terms and conditions set forth in any agreement executed by the former Executive as a condition to receiving benefits under the Plan, including, but not limited to, the General Release, or violation of any non-disclosure, non-competition or non- solicitation or provisions contained in such other plans or agreements. 4.3 Clawback. The benefits under this Plan are subject to the terms of the Company's or any other Employer's recoupment, clawback or similar policies as may be in effect from time to time, as well as any similar provisions of applicable law, any of which could in certain circumstances require repayment or forfeiture of any cash or other property received under this Plan. ARTICLE 5 EXECUTIVE COVENANTS 5.1 Reasonableness of Restrictions. Each Executive shall acknowledge that he or she has had and will continue to have access to Confidential Information (as defined below), that such Confidential Information is of economic value to the Employer, that such Confidential Information would be of value to a competitor of the Employer in competing against the Employer, and that it would be unfair for the Executive to exploit such Confidential Information for the Executive’s personal benefit or for the benefit of a competitor. Each Executive shall further acknowledge that he or she has had and/or will have an opportunity to learn about, and develop relationships with, customers of the Employer and that the Employer have a legitimate interest in protecting relationships with such customers, and that it would be unfair for the Executive to exploit information the Executive has learned about such customers and relationships that the Executive has developed with such customers for the Executive’s personal benefit or for the benefit of a competitor. The Executive further acknowledges that the Employer currently markets and sells products and services to customers throughout the world and that the Executive’s job duties have included and/or will include contact with products that are marketed throughout the United States or, for an Executive employed outside the United States, the country in which the Executive is employed and that the Confidential Information to which the Executive has had and/or and will have access to, and the Executive’s customer knowledge and contacts and relationships, would be of value to a competitor in competing against the Employer 4811-1906-7992.2


 
anywhere in the country in which the Executive is employed. Accordingly, each Executive shall acknowledge that the protections provided to the Employer in this Article 5 are reasonable and necessary to protect the legitimate interests of the Employer and that abiding by the Executive’s obligations under this Article 5 will not impose an undue hardship on the Executive. 5.2 Restricted Services Obligation. For a period of two years following the end, for whatever reason, of an Executive’s employment with the Employer, the Executive shall agree not to directly or indirectly provide Restricted Services to any Competitor respecting its operations in the country in which the Executive was employed. For purposes of this Section, (i) “Restricted Services” means services of any kind or character comparable to those the Executive provided to the Employer during the one year period preceding the end of the Executive’s employment with the Employer, and (ii) “Competitor” means any business located in the country in which the Executive was employed that is engaged in the development and/or sale of any product line or service offering that is substantially similar (and thus competitive with) to a product line or service offering sold by the Employer for which the Executive had direct managerial responsibility during the last year of the term of the Executive’s employment with the Employer. Notwithstanding the foregoing, this Section 5.2 shall not apply to an Executive whose principal place of employment with an Employer is in the State of California. 5.3 Customer Non-Solicitation. For a period of two years following the end, for whatever reason, of the Executive's employment with the Employer, the Executive shall agree not to directly or indirectly attempt to sell or otherwise provide to any Restricted Customer any goods, products or services of the type or substantially similar to the type sold or otherwise provided by the Employer (and thus competitive with such goods, products or services) for which the Executive was employed during the twelve months prior to termination of the Executive’s employment. For purposes of this Section 5.3, “Restricted Customer” means any individual or entity (i) for whom/which the Employer provided goods, products or services, and (ii) with whom/which the Executive was the primary contact on behalf of the Company during the Executive’s last twelve months of employment or about whom/which the Executive acquired non-public information during the Executive’s last twelve months of employment that would be of benefit to the Executive in selling or attempting to sell such goods, products or services in competition with the Employer. 5.4 Non-Solicitation of Employees. During the term of the Executive’s employment with the Employer and for a period of one year thereafter, the Executive shall agree not to directly or indirectly encourage any employee of the Employer with whom the Executive has worked to terminate his or her employment with the Employer or solicit such an individual for employment outside the Employer in a manner which would end or diminish that employee’s services to the Employer. 5.5 Non-Disparagement. During the term of the Executive’s employment with the Employer and thereafter in perpetuity, the Executive shall not knowingly disparage, criticize, or otherwise make derogatory statements regarding the Employer or any of its affiliates, successors, directors, officers, customers or suppliers. During the term of the Executive’s employment with the Employer and thereafter in perpetuity, none of the Company, Rexnord LLC, or any other Employer nor any of their respective officers shall knowingly disparage, criticize, or otherwise make derogatory statements regarding the Executive. The restrictions of this Section 5.5 shall 4811-1906-7992.2


 
not apply to any statements that are made truthfully in response to a subpoena or other compulsory legal process. 5.6 Non-Disclosure of Confidential Information. (a) The Executive shall maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose, publish or otherwise misappropriate, or use for the Executive’s benefit or the benefit of any Person, or deliver to any Person any Confidential Information (as defined herein) or trade secrets of the Company. "Confidential Information" means any document, record, notebook, computer program or similar repository of or containing, any confidential or proprietary information of or relating to the Employer, including, without limitation, information with respect to the Employer’s operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment. Confidential Information shall be defined to exclude information which is or becomes public knowledge through no fault of the Executive, or which was known to the Executive before the start of the Executive’s earliest relationship with the Employer, or which is otherwise not subject to protection under applicable law. The Executive’s obligations under this Section 5.6 shall apply for so long as the Executive continues in the employment of the Employer and for two years following the termination of such employment, for whatever reason, as to any Confidential Information that does not constitute a trade secret under applicable law. As to any Confidential Information that does constitute a trade secret under applicable law, the Executive shall agree that the Executive's obligations under this Section 5.6 shall apply for so long as the item qualifies as a trade secret. (b) The Executive is advised that he or she may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and provided that such disclosure is solely for the purpose of reporting or investigating a suspected violation of the law, or (ii) in a complaint or other document filed in a lawsuit or other proceeding, provided that such filing is made under seal. Additionally, in the event the Executive files a lawsuit against the Employer for retaliation by the Employer against the Executive for reporting a suspected violation of law, the Executive has the right to provide trade secret information to the Executive's attorney and use the trade secret information in the court proceeding, although the Executive must file any document containing the trade secret under seal and may do not disclose the trade secret, except pursuant to court order. 5.7 Return of Company Property. All correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Employer’s customers, business plans, marketing strategies, products or processes, whether confidential or not, is the property of the Company (the “Company 4811-1906-7992.2


 
Property”). Accordingly, upon the Executive’s Termination of Employment for any reason, the Executive shall promptly deliver to the Company all such Company Property, including any and all copies of any such Company Property, and shall not make any notes of or relating to any information contained in any such Company Property. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought and shall assist such counsel in resisting or otherwise responding to such process. 5.8 Injunctive Relief. The Executive shall acknowledge that a breach of the covenants contained in this Article 5 will cause irreparable damage to the Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive shall agree that, in the event of an actual or threatened breach of any of the covenants contained in this Article 5, in addition to any other remedy which may be available at law or in equity, the Company shall be entitled to specific performance and injunctive relief. The Company acknowledges that a breach of the Company’s covenant contained in Section 5.5 will cause irreparable damage to the Executive, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Company agrees that, in the event of an actual or threatened breach of the Company’s covenant contained in Section 5.5, in addition to any other remedy which may be available at law or in equity, the Executive shall be entitled to specific performance and injunctive relief. ARTICLE 6 GENERAL RULES 6.1 Right to Withhold Taxes. The Employer shall withhold such amounts from payments under the Plan as it determines necessary to fulfill any country, federal, state, or local wage or compensation withholding requirements. 6.2 Assignment. Benefits under the Plan may not be assigned. 6.3 Unfunded Plan. The Employer will make all payments under the Plan, and pay all expenses of the Plan, from its general assets. Nothing contained in the Plan shall give any eligible Executive any right, title or interest in any property of the Employer. 6.4 Code Section 409A. It is intended that any amounts payable under the Plan shall comply with the provisions of Code Section 409A and the Treasury Regulations relating thereto so as not to subject an Executive to the payment of interest and tax penalty which may be imposed under Code Section 409A. In furtherance of this interest, anything to the contrary herein notwithstanding, no amounts shall be payable to an Eligible Executive before such time as such payment fully complies with the provisions of Code Section 409A and, to the extent that any regulations or other guidance issued under Code Section 409A after the date of this Agreement would result in the Executive being subject to payment of interest and tax penalty under Code Section 409A, the parties agree to amend this Agreement in order to bring this Agreement into compliance with Code Section 409A. In addition, solely for purposes of compliance with Code Section 409A, Qualifying Termination shall not be deemed to have occurred for purposes of the 4811-1906-7992.2


 
Plan unless such termination is also a separation from service (within the meaning of Treasury Regulation Section 1.409A-1(h) (applying the 20% default post-separation limit thereunder)) as an employee and references to a “termination” or “termination of employment” shall mean separation from service as an employee. 6.5 Governing Laws; Other Obligations. The provisions of the Plan shall be construed, administered and enforced in accordance with the laws of the State of Wisconsin and any applicable federal laws. The obligations and restrictions set forth in this Plan are in addition to and not in lieu of any obligations or restrictions imposed upon Executive under any other agreement or any other law or statute including, but not limited to, any obligations Executive may owe under any law governing trade secrets, any common law duty of loyalty, or any fiduciary duty. No time or geographic restriction provided above shall affect the availability or scope of protection afforded to the Company’s trade secrets. ARTICLE 7 AMENDMENT AND TERMINATION The Compensation Committee may modify, amend, or terminate the Plan at any time without prior notice, and the Company's Chief Executive Officer or Chief Human Resources Officer may also amend or modify the plan to reflect administrative or other changes that do not have a material effect on the amount of benefits provided under the Plan. However, the Company will pay or continue to pay benefits in accordance with the provisions of the Plan to the Executives whose employment is terminated prior to any modification, amendment or termination of the Plan. ARTICLE 8 ADMINISTRATION 8.1 Powers and Duties. The Plan Administrator shall have sole authority and discretion to administer and construe the terms of the Plan, subject to applicable requirements of law. Without limiting the foregoing, the Plan Administrator shall have power to: (a) Provide rules and regulations for the administration of the Plan and, from time to time, to amend or supplement such rules and regulations; (b) Construe the Plan, which construction shall be final and binding; (c) Correct any defect, supply any omission, or reconcile any inconsistency in the Plan in such manner and to such extent as it shall deem expedient to effect the purpose of the Plan; and (d) Delegate to such other parties as are appropriate all or any part of the responsibilities specifically required of the Plan Administrator under the terms of the Plan. No benefits shall be paid under the Plan unless the Plan Administrator, in its sole discretion, determines that an Eligible Executive is entitled to such benefits. 4811-1906-7992.2


 
8.2 Finality of Action. Except as provided in Section 9.3, the acts and determinations of the Compensation Committee and Company within the powers conferred by the Plan shall be final and conclusive for all purposes of the Plan. 8.3 Claim Procedure. An Executive who believes that he or she is entitled to benefits under the Plan in an amount greater than what the Executive is receiving or has received may file a claim within 12 months of his or her termination of employment for such benefits by writing directly to the corporate offices of the Company, located in Milwaukee, Wisconsin. Such claims shall be referred to a person designated by the Company, who shall prepare an appropriate written response. Every claim that is filed timely shall be answered in writing stating whether the claim is granted or denied. If the claim is denied, the reasons for denial and reference to the relevant plan provisions shall be set forth in a written notice to the claimant. Such notice shall also describe information necessary for the claimant to perfect an appeal and include an explanation of the Plan’s claim appeal procedure. Within 90 days of notice that a claim is denied, the claimant may file a written appeal to the Company, including any comments, statements or documents the claimant may wish to provide. Appeals shall be considered by the Compensation Committee or a committee of not less than three persons designated by the Compensation Committee, none of whom shall be the person who responded to the initial claim. In the event the claim is denied upon appeal, the Compensation Committee or its designee shall set forth in writing the reasons for denial and the relevant provisions of the Plan. The Company shall comply with any reasonable written request from a claimant for documents or information relevant to this claim prior to the filing of an appeal. * * * 4811-1906-7992.2