(i)
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Executive’s base salary and accrued bonus and certain other benefits historically received by Executive such as automobile allowance, life insurance and Non-qualified Deferred Compensation Plan contributions, through the termination of Executive’s employment. Such payment shall be made not later than 30 days from the date of termination and in no event shall Executive have any ability to select the year in which this payment shall be made.
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(ii)
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A lump sum payment equal to two times the sum of Executive’s base salary as in effect immediately preceding the Change in Control plus the average of the cash bonus amounts paid to Executive for each of the two fully-completed fiscal years immediately preceding the fiscal year in which the Change in Control occurs. Such payment shall be made not later than 30 days from the date of termination and in no event shall Executive have any ability to select the year in which this payment shall be made.
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(iii)
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Continued participation in medical and dental plans, with benefits substantially similar to those of LSI in effect prior to the Change in Control, for twenty-four months beginning on the later of the effective date of the Change in Control or termination of Executive’s employment. In no event shall any payments or reimbursements be made to Executive pursuant to such plans after the end of the year following the calendar year in which a claim on behalf of Executive’s account has occurred.
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(i)
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Any person (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including a “group” as defined in Section 14(d) of the Exchange Act) is or becomes the beneficial owner (as defined under Rule 13d-3 under the Exchange Act), directly or indirectly, of LSI securities representing more than 25% of the combined voting power of LSI’s then-outstanding securities;
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(ii)
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During any one year period individuals who at the beginning of such period constitute the Board and any new director whose election to the Board or nomination for election by LSI’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to constitute at least a majority of the Board;
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(iii)
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A reorganization, merger or consolidation of LSI in each case, unless, following such reorganization, merger or consolidation, all or substantially all of the individuals and entities who were the beneficial owners (as defined under Rule 13d-3 under the Exchange Act) of LSI’s outstanding voting securities immediately prior thereto beneficially own, directly or indirectly, more than 75% of the combined voting power of LSI’s then-outstanding voting securities entitled to vote generally in the election of directors of the reorganized, merged or consolidated company in substantially the same proportions as their ownership immediately prior to such reorganization, merger or consolidation; or
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(iv)
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A liquidation, dissolution, sale or other disposition of all or substantially all of the assets of LSI other than in a transaction in which all or substantially all of the individuals and entities who were the beneficial owners (as defined under Rule 13d-3 under the Exchange Act) of LSI’s outstanding voting securities immediately prior to such sale or other disposition beneficially own, directly or indirectly, substantially all of the combined voting power of LSI’s then-outstanding voting securities entitled to vote generally in the election of directors of the acquiror of such assets (either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such sale or other disposition.
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(i)
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Executive is assigned any duties which are materially inconsistent with the position and status of an executive of LSI, or there occurs a substantial alteration in the nature, status or prestige of Executive’s official position resulting in a material decrease in authority or responsibilities from those in effect immediately prior to a Change in Control;
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(ii)
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Executive’s salary is decreased materially, or the Executive’s benefits or opportunities under any employee benefit or incentive plan or program are materially reduced; or
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(iii)
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Executive’s principal office location is relocated materially, which in this case shall be defined as more than fifty miles from the Executive’s then office location prior to the Change in Control.
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(i)
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Payment to Specified Employee: If a payment obligation under the Agreement is made to an Executive upon his or her separation from service while he or she is a “specified employee” (as defined under Section 409A of the Code and determined in good faith by the Compensation Committee), any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1) after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12) that is scheduled to be paid within six (6) months after such separation from service shall accrue interest and shall be paid on the first day of the seventh month following separation from service.. During the 6-month delay period, interest shall accrue at the prime rate of interest published in the Midwest edition of The Wall Street Journal on the date of Executive’s separation from service. Accordingly, subject to the requirements of Section 409A of the Code, an Executive may not receive his or her Change in Control Benefits payment until 6 months after separation from service.
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(ii)
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Compliance Intended: This Policy is intended not to result in the imposition of any tax, interest charge or other assessment, penalty or addition under Section 409A of the Code. In addition to any specific references to Section 409A of the Code in this Policy, all terms and conditions of this Policy are intended, and shall be interpreted and applied to the greatest extent possible in such manner as may be necessary, to comply with or be exempt from the provisions of Section 409A of the Code and any rules, regulations or other regulatory guidance issued under Section 409A of the Code. However, LSI does not guarantee any particular tax effect to Executive. LSI shall not be liable to Executive for any payment made under this Agreement that is determined to result in an additional tax, penalty, or interest under Section 409A of the Code, nor for reporting in good faith any payment made under this Agreement as an amount includible in gross income under Section 409A of the Code.
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