ADT 2008 Annual Report Download - page 61

Description Chief Executive Officer Named Executive Officers
Restrictive covenants: • Prohibited from soliciting • Prohibited from soliciting
customers and employees of customers and employees of
Tyco for one year from the Tyco for two years from the
date of termination. date of termination.
• Prohibited from competing • Prohibited from competing
with Tyco for one year from with Tyco for one year from
the date of termination (two the date of termination.
years with respect to a • Subject to confidentiality and
competing business that non-disparagement
generates more than 30% of covenants.
its gross revenues from the
security business).
• Subject to confidentiality and
non-disparagement
covenants.
Under Mr. Breen’s employment agreement, a change in control is treated as a termination for
‘‘Good Reason’’ if Mr. Breen chooses to terminate his employment within the 30-day period
commencing on the first anniversary of the change in control.
For the other named executive officers, the CIC Severance Plan generally defines ‘‘Cause’’ as
(i) substantial failure or refusal to perform duties and responsibilities of his or her job as required by
the Company, (ii) a material violation of any fiduciary duty owed to the Company, (iii) conviction of,
or entry of a plea of nolo contendere with respect to, a felony or misdemeanor, (iv) dishonesty,
(v) theft, or (vi) other egregious conduct, that is likely to have a materially detrimental impact on the
Company and its employees. Whether an executive’s termination is due to ‘‘Cause’’ under the CIC
Severance Plan is determined by the administrator of the CIC Severance Plan.
The CIC Severance Plan generally defines ‘‘Good Reason Resignation’’ as any retirement or
termination of employment by an executive that is not initiated by the Company and that is caused by
any one or more of the following events, provided the event occurs in the period beginning 60 days
before the change-in-control date and ending two years after that date:
• Without the executive’s written consent, the Company assigns the executive any duties
inconsistent in any material respect with his or her authority, duties or responsibilities, or any
other action by the Company which results in a significant diminution in such authority, duties
or responsibilities;
• Without the executive’s written consent, the Company makes a material change in the
geographic location at which the executive performs services to a location that is more than 60
miles from his or her existing principal place of employment;
• Without the executive’s written consent, the Company reduces the executive’s base compensation
and benefits, taken as a whole; or
• the Company fails to obtain a satisfactory agreement from any successor to assume and agree to
perform the Company’s obligations to the executive under the CIC Severance Plan.
If an executive remains employed for more than 150 days following the occurrence of any event set
forth above, any subsequent retirement or termination of employment by the executive that is not
initiated by the Company will not constitute a ‘‘Good Reason Resignation.’’ Whether an executive’s
termination is as a result of a ‘‘Good Reason Resignation’’ is determined by the administrator of the
CIC Severance Plan.
44 2009 Proxy Statement