Severance Plan, dated as of March 3, 2020, by and between Leslies Poolmart, Inc. and Paula Baker
Execution Copy November 4, 2019
LESLIES POOLMART, INC. EXECUTIVE SEVERANCE PAY PLAN
Leslies Poolmart Inc. (hereinafter the Company) hereby adopts the Leslies Poolmart, Inc. Executive Severance Pay Plan (the Plan), effective upon the date of its execution.
Section 1: Purpose; Definitions
1.1 Purpose. The purpose of the Plan is to provide severance pay to eligible executives of the Company in the circumstances and on the conditions specified. The Plan is an employee welfare benefit plan within the meaning of Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended, (hereinafter ERISA), Neither the receipt nor the amount of any severance payment is contingent, directly or indirectly, on an employees retirement. Severance payments are contingent, prospective payments that may be provided under the circumstances and conditions described.
a. Cause. With respect to any Participant, Cause means (i) the willful and continued failure by Participant to substantially perform their duties with the Company; (ii) conviction of any felony; (iii) conviction of any crime involving moral turpitude or dishonesty that causes, or is likely to cause, harm to the Company; (iv) participation in a fraud or willful act of dishonesty against the Company that causes, or is likely to cause, harm to the Company; (v) intentional and material damage to the Companys property; (vi) the Participants intentional failure to follow, or intentional conduct that violates the Companys written policies that are generally applicable to all officers of the Company or (vii) the Participants intentional violation of any term of agreement between the Participant and the Company, including non-disclosure and non-competition agreements, or any statutory duty the Participant owes to the Company.
b. Code. The Internal Revenue Code of 1986 as amended from time to time, or any successor thereto.
c. Compensation Committee. The Compensation Committee means the Compensation Committee of the Companys board of directors.
d. Covered Employer. For purposes of the Plan, the term Covered Employer is defined to mean the Company or one of the Companys subsidiaries.
e. Eligible Employee. An individual designated by the Company, who (i) is not eligible for severance benefits under any other plan, program, policy, procedure or agreement of or with the Company, (ii) incurs a Separation From Service without Cause, by action of the Company, other than as a result of death, total disability as contemplated by a long term disability plan of the Company, or any voluntary resignation or termination, and (iv) executes a Final Release, at the time of Separation From Service.
f. Final Release. A general release effective between or among the Company and the Participant, which is satisfactory in form and substance to the Company, as applicable, and for which the period has expired for the exercise of any revocation rights of the Participant with respect thereto.
g. Participant. Each Eligible Employee.
h. Plan Administrator. The Compensation Committee is the Plan Administrator. The Compensation Committee may delegate its authority under the Plan to such person(s) as it deems necessary or appropriate from time to time, and any such delegation shall carry with it the Plan Administrators discretionary authority.
i. Plan Year. The Plan Year is the 12-month period beginning each January 1 and ending the next following December 31.
j. Separation From Service. A termination of substantial services for the Company and any affiliate thereof within the contemplation of Code Sections 414(b) and 414(c). An individual will not be treated as having incurred a Separation From Service where the individuals level of future services for the Company and any affiliate is reasonably anticipated by the Employer to exceed 30% of the average level of bona fide services provided by that individual in any capacity for the prior 36 month period, or the prior period of services if less, but will be treated as having incurred a Separation From Service at any time when such reasonably anticipated level of future services is equal to or less than such 30% average level of prior services.
k. Senior Officer. An officer of the Company above the level of Vice President and Group Vice President.
l. Year of Service. A calendar year in which an individual is credited with not fewer than one thousand (1,000) hours of service, as determined under Department of Labor Regulation 2530.200b-2(b) and (c).
Execution Copy November 4, 2019
Section 2: Eligibility
Each individual is a Participant in the Plan as of the date the individual becomes a Senior Officer and satisfies all elements of the definition of an Eligible Employee. No other persons have any rights under the Plan or to receive any benefit under the Plan. No employee will be eligible to receive a benefit under the Plan unless the employee and the Company execute a Participation Agreement substantially in the form attached as Exhibit A to the Plan (or another form approved by the Compensation Committee). The executed Participation Agreement will constitute an agreement between the Company and the employee that binds both of them to the terms of the Plan and will bind their heirs, executors, administrators, successors, and assigns, both present and future.
Section 3: Plan Benefits
3.1 Benefits. A Participant is eligible to receive periodic severance payments based upon employment status at the time of a Separation From Service, in accordance with the applicable following schedule:
|Duration of |
3.2 Payment of Benefits. Plan benefits will be the Participants base pay amount, for the appropriate duration described in section 3.1, using the payroll date frequency in effect for the Participant as of the date the individual incurs a Separation From Service, as provided in this section 3.2.
a. Payment Timing. Payment of Plan benefits will commence on the 30th day following the Participants Separation From Service, provided the Participant has executed a Final Release (for which any revocation rights have expired) before the end of such 30 day period. Plan benefits with respect to the period from the date of Separation From Service until such payment commencement date will be accumulated and paid on the first business date which occurs after the expiration of such 60 day period, and remaining Plan benefits will be paid thereafter on normal payroll cycles (except as otherwise provided in section 5.3 with respect to certain death benefits).
b. No Final Release. If an otherwise Eligible Employee fails to execute a Final Release (for which any revocation rights have expired) before the end of the 30 day period described in section 3.2.a. above, such individual shall be ineligible for Plan benefits.
3.3 Deductions. The employer will effect all legally required deductions. All payments under the Plan will be subject to tax withholding or other withholding required or permitted by applicable law to the extent deemed necessary by the Administrator. The Participant will bear the cost of any taxes not withheld on benefits provided under the Plan, regardless of whether withholding is required.
Section 4: Financing Plan Benefits
All Plan benefits shall be paid directly by the Company or Designated Subsidiary out of its general assets. All Plan benefits are unfunded and unsecured until paid.
Section 5: Covenants
5.1 Generally. In consideration for the benefits provided under the Plan, each Participant will agree to the covenants set forth in this Section 5.
5.2 No Disparagement. The Participant will at no time make any derogatory, misleading or otherwise negative statement about the actions, performance or behavior of the Company or its officers, directors, employees and agents.
5.3 Cooperation. The Participant will cooperate with the Company in order to ensure an orderly transfer of his or her duties and responsibilities. In addition, the Participant will at all times, both before and after termination of employment, (a) provide reasonable cooperation in connection with any action or proceeding (or any appeal from any action or proceeding) that relates to events occurring during the Participants employment hereunder, provided that such cooperation does not materially interfere with the Participants then current employment, and (b) cooperate with the Company in executing and delivering documents requested by the Company, and taking any other actions, that are necessary or requested by the Company to assist the Company in patenting, copyrighting, or registering any programs, ideas, inventions, discoveries, patented or copyrighted material, or trademarks, and to vest title thereto in the Company.
5.4 Recoupment. If the Participant breaches any of the covenants set forth in this Section 5, the Company will have no further obligation to pay to the Participant any benefit under the Plan, and the Participant will be obligated to repay to the Company all benefits previously paid to, or on behalf of, the Participant under the Plan.
Execution Copy November 4, 2019
Section 6: Miscellaneous
5.1 Employment Rights. No provisions of the Plan and no action taken by the Company or the Administrator will give any person any right to be retained in the employ of the Company. The Plan does not constitute a contract of employment and the Company and Participant acknowledge that Participants employment is and will continue to be at-will, as defined under applicable law. Participation does not give any person the right to be rehired or retained.
5.2 Controlling Law. ERISA shall be controlling in all matters relating to the Plan. The provisions of this Plan are intended to be applied in a manner consistent with Code Section 409A, but neither the Company nor any affiliate thereof shall be liable for any determination by any person(s) that the arrangement or the administration thereof is subject to the tax provisions of Code Section 409A.
5.2 No Right To Assets. Participation in the Plan does not create, in favor of any Participant, any right or lien in or against any asset of the Company. Nothing contained in the Plan, and no action taken under its provisions, will create or be construed to create a trust of any kind, or a fiduciary relationship, between the Company and a Participant or any other person. The Companys promise to pay benefits under the Plan will at all times remain unfunded as to each Participant, whose rights under the Plan are limited to those of a general and unsecured creditor of the Company.
5.4 Interests Not Transferable. The interests of persons entitled to benefits under the Plan may not be sold, transferred, alienated, assigned nor encumbered; provided, however, that upon the death of a Participant in pay status under the Plan, the sum of any remaining scheduled benefit payments will be paid in a lump sum to the surviving spouse of the Participant, if any, or if none then to the estate of the Participant.
5.5 Headings. The headings of sections and subsections herein are for convenience of reference only and shall not be construed or interpreted as part of the Plan.
5.6 Severability. If any provision of the Plan shall be held to be illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if such illegal or invalid provision had never been contained in the Plan.
5.7 Administration. The Plan Administrator shall have the sole and final power, duty, discretion, authority and responsibility of directing and administering the Plan. All directions by the Plan Administrator shall be conclusive on all parties concerned. The Plan Administrator shall have the sole, absolute and final right and power to construe, interpret and administer the provisions of the Plan including, but not limited to, the power (i) to construe any ambiguity and interpret any provision of the Plan or supply any omission or reconcile any inconsistencies in such manner as it deems proper, (ii) to determine eligibility to become a Participant in the Plan in accordance with its terms, (iii) to decide all questions of eligibility for, and determine the amount, manner, and time of payment of, any benefits hereunder, and (iv) to establish uniform rules and procedures to be followed in any matters required to administer the Plan.
Section 6: Amendment and Termination
The Company reserves the right, in its sole discretion, to amend the Plan from time to time or to terminate the Plan, all without prior notice. No representation by anyone can extend the Companys severance pay policies to provide for severance payments that are not covered by the Plan.
Execution Copy November 4, 2019
Date: November 4, 2019
To: Paula Baker
Subject: Leslies Poolmart, Inc. 2019 Executive Severance Plan Participation Agreement
I am pleased to advise that you have been designated as an Eligible Employee for the purposes of the Leslies Poolmart, Inc. 2019 Executive Severance Plan, as amended from time to time (the Plan). A copy of the current plan document is enclosed).
This means that, upon your execution of this agreement, you will be eligible to receive the severance benefits described in the Plan in the event you experience a Separation From Service without Cause as defined under the Plan. If you have any questions, please contact me or Steve Weddell.
By signing the attached signature page and in consideration of the opportunity to participate in the Plan, you agree to be bound by the terms of the Plan, including the covenants set forth in Section 5 of the Plan. Your participation in the Plan does not confer any rights to continue in the employ of Leslies or any of its affiliates.
Please sign the attached signature page and return the original to Steve Weddell as soon as possible.
|/s/ Steven L. Ortega|
|Steven L. Ortega|
|Executive Chairman, Chief Executive Officer and President|
Execution Copy November 4, 2019
Leslies Poolmart, Inc. 2019 Executive Severance Plan
Agreement Signature Page
November 4, 2019
I, Paula Baker, have read the Leslies Poolmart, Inc. 2019 Executive Severance Plan and agree to its terms, and I agree to be bound by the terms of the covenants in Section 5 of the Plan. This agreement supersedes any and all prior agreements and communications, whether written or oral, between the Company and me regarding the subject matter of the Plan.
Please return to Steven Weddell, EVP and Chief Financial Officer by November 8, 2019.