ADT 2010 Annual Report Download - page 64

consulting with the Company’s counsel, he reasonably believed that no law was being violated by
such acts; or
• Termination evidenced by a resolution adopted in good faith by at least two-thirds of the
members of the Board. Such resolution must conclude that Mr. Breen intentionally and
continually failed substantially to perform his reasonably assigned duties with the Company
(other than a failure resulting from his incapacity due to physical or mental illness or from the
assignment to Mr. Breen of duties that would constitute ‘‘Good Reason’’), which failure has
continued for a period of at least 30 days after a written notice of demand for substantial
performance, signed by a duly authorized member of the Board, has been delivered to
Mr. Breen specifying the manner in which Mr. Breen has failed substantially to perform; or
intentionally engaged in conduct which is demonstrably and materially injurious to the Company;
provided, however, Mr. Breen has been given a detailed notice of the termination under this
paragraph and he has been given the opportunity to be heard in person by the Board.
Mr. Breen’s employment agreement generally defines ‘‘Good Reason’’ as any of the following
events:
• Assignment to Mr. Breen of any duties inconsistent in any material respect with his position
(including titles and reporting relationships), authority, duties or responsibilities as contemplated
by the employment agreement, or any other action by the Company, which results in a
significant diminution in such position, authority, duties or responsibilities;
• Any failure by the Company to comply with any of the material provisions regarding Mr. Breen’s
base salary, bonus, annual equity incentive, benefits and perquisites, retirement benefit,
relocation, and other benefits and amounts payable to Mr. Breen under the agreement;
• Mr. Breen being required to relocate to a new principal place of employment more than 60
miles from his established principal place of employment with the Company;
• The delivery by the Company of a notice of non-renewal of his employment at the end of his
current employment period;
• The failure by the Company to elect or to re-elect Mr. Breen as a Director and as Chairman of
the Board, or the removal of Mr. Breen from either such position; or
• Any termination by Mr. Breen during the 30-day period immediately following the first
anniversary of the date of any change in control.
For the other named executive officers, the Severance Plan generally defines ‘‘Cause’’ as an
executive’s (i) substantial failure or refusal to perform duties and responsibilities of his or her job as
required by the Company; (ii) violation of any fiduciary duty owed to the Company; (iii) conviction of a
felony or misdemeanor; (iv) dishonesty; (v) theft; (vi) violation of Company rules or policy; or
(vii) other egregious conduct, that has or could have a serious and detrimental impact on the Company
and its employees. The administrator of the Severance Plan, in its sole and absolute discretion,
determines whether Cause exists.
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