David R. Odenath<\/p>\n
Legg Mason & Co., LLC<\/p>\n
Baltimore, MD<\/p>\n
Re: Severance Agreement and Release of Claims<\/p>\n
Dear David:<\/p>\n
This letter sets forth the terms pertaining to the termination of your
\nemployment by Legg Mason & Co., LLC, a subsidiary of Legg Mason, Inc.
\n(collectively “Legg Mason”), effective as of December 31, 2010 (the “Separation
\nDate”). We hope that your separation from Legg Mason can occur as smoothly as
\npossible for you and for Legg Mason.<\/p>\n
1. You will be paid through December 31, 2010 and you will receive your final
\npaycheck on that date. You will also receive any accrued but unused paid time
\noff to which you may be entitled, if any, at that time in a separate check. In
\naddition, you will be entitled to reimbursement for all reasonable business
\nexpenses incurred in pursuing your duties prior to the Separation Date.
\nEffective on the date hereof, you resign from all officer and director positions
\nyou hold with the Company and any of its subsidiaries, including your positions
\nas Senior Executive Vice President and Head of Americas of the Company, and will
\nbe employed until the Separation Date in a consulting capacity to assist with
\ntransition issues.<\/p>\n
Upon expiration of the revocation period described in Paragraph 7 below, and
\nin lieu of any additional monetary consideration and settlement of all amounts
\ndue under the letter agreement dated August 29, 2008 between you and Legg Mason
\n(the “Offer Letter”), Legg Mason will:<\/p>\n
(i) accelerate to the date of such expiration the vesting of all unvested
\nstock options and shares of restricted stock awarded to you on October 27, 2008;
\nand<\/p>\n
(ii) pay you, by direct deposit to the account to which your payroll checks 2. Furthermore, in exchange for the consideration in the form of your <\/p>\n If you are currently enrolled in Legg Mason medical, dental and\/or vision Under this Agreement, you will receive a COBRA subsidy consisting of 100% of 3. Except as expressly set forth in this Agreement, you will be entitled to 4. In connection with your employment with Legg Mason or its related 5. You agree not to disclose any information concerning the existence or 6. In exchange for the consideration provided by Legg Mason in Paragraphs 1 2<\/p>\n <\/p>\n your heirs, successors, assigns and any personal or legal representatives Notwithstanding the general release above, you do not waive any rights or This release does not prohibit you from filing a charge with any government 7. In accordance with the requirements of the ADEA, as amended by the OWBPA, a. Time to consider this Agreement<\/u>. You acknowledge that you have been b. Attorney counsel.<\/u> You are advised to consult with an attorney prior 3<\/p>\n <\/p>\n c. Revocation<\/u>. You acknowledge that you have a period of seven (7) d. When the terms become effective<\/u>. The terms of the Agreement shall 8. Both parties agree that neither this Agreement nor the payment of any 9. You agree that you will not disparage, defame, or otherwise represent in a 10. In the event that you bring a legal action, or any dispute, claim or 11. You acknowledge that you have been involved in several projects or tasks 4<\/p>\n <\/p>\n Mason, you shall be compensated for all time spent on such assistance at the 12. You agree that you will not directly or indirectly solicit any business Further, in consideration of the compensation terms set forth herein, you 13. You acknowledge that, at some point in the future, litigation may arise 14. You agree that the provisions of this Agreement constitute material 15. If any portion of this Agreement is deemed to be invalid by an 5<\/p>\n <\/p>\n 16. This Agreement sets forth the entire agreement and understanding between 17. Part of this Agreement is intended to be exempt from Section 409A of the 18. This Agreement will be interpreted and enforced in accordance with the You are advised to consult with an attorney prior to signing this Agreement. If you do not accept this proposal, Legg Mason will nevertheless proceed with I wish you the best of success and personal and professional fulfillment in Sincerely,<\/p>\n<\/td>\n<\/tr>\n \/s\/PATRICIA LATTIN<\/p>\n<\/td>\n<\/tr>\n Patricia Lattin<\/p>\n<\/td>\n<\/tr>\n Managing Director<\/p>\n<\/td>\n<\/tr>\n Head of Human Resources<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n 6<\/p>\n <\/p>\n Date Agreement was given to employee:<\/p>\n December 17, 2010<\/p>\n I ACKNOWLEDGE THAT I HAVE READ THIS AGREEMENT, UNDERSTAND IT AND VOLUNTARILY \/s\/DAVID ODENATH<\/p>\n<\/td>\n Signature<\/p>\n<\/td>\n 12-17-10<\/p>\n<\/td>\n Date<\/p>\n<\/td>\n 7<\/p>\n
\nare deposited, an amount equal to $3,936,000, minus applicable payroll
\ndeductions. Such payment shall be made on the first business day following the
\n8th calendar day after the date hereof (i.e.<\/em>, following expiration of
\nthe revocation period).<\/p>\n
\nagreement to the terms provided in this Agreement, you are eligible for
\nexecutive-level career transition services. These career transition services are
\nsubject to IRS rules applicable to reimbursements and in-kind benefits under
\nseparation pay plans. Information regarding career transition and outplacement
\nservices will be mailed to your home address within two (2) weeks after you have
\nsigned and executed this Agreement. Please contact us if you do not receive this
\ninformation. You will have three (3) months to make initial contact with the
\noutplacement services vendor.<\/p>\n
\n
\nplan, your current active coverage will end on December 31, 2010 and you will be
\neligible for COBRA continuation coverage for the maximum period of time
\nallowable by law, with subsidy as described below:<\/p>\n
\nyour applicable COBRA premium for twelve months (January 1, 2011 : December 31,
\n2011). This subsidy shall be paid directly on your behalf to Legg Mason153s COBRA
\nprovider. You will receive a COBRA Enrollment package within two weeks of your
\nseparation date. You must complete the Enrollment forms and return them to the
\nCOBRA administrator within 60 days in order to receive the COBRA subsidy and
\ncontinue your health benefits.<\/p>\n
\nno other benefits or further compensation from Legg Mason, except vested
\nbenefits or any other benefit required by law. All payments made to you shall be
\nless all applicable taxes and other deductions as required by law. You
\nacknowledge and agree that your unvested stock options and shares of restricted
\nstock not mentioned in paragraph 1 above will be forfeited on December 31, 2010
\nin accordance with their terms and, unless previously exercised, your vested
\nstock options will terminate 90 days after the Separation Date in accordance
\nwith their terms.<\/p>\n
\nentities, you had access to information of a nature not generally disclosed to
\nthe public. You agree to maintain the confidentiality of any non-public business
\ninformation obtained during your employment with Legg Mason or its related
\nentities, as well as to keep confidential any business, proprietary or trade
\nsecret information in your possession pertaining to Legg Mason or its related
\nentities. You also agree (i) to return promptly any books, notes, files,
\ndocuments, computer data, keys and passwords or other property in the same
\ncondition it was in at the time the property was issued to you that belongs to
\nLegg Mason or its related entities; and (ii) not to copy or take or retain in
\nyour possession any books, notes, e-mails, documents or property belonging to
\nLegg Mason or its related entities without my express written consent.<\/p>\n
\nterms of this Agreement to anyone other than your attorney, tax advisor and\/or
\nspouse. The foregoing limitation will expire upon the date that Legg Mason files
\nthis Agreement with the Securities and Exchange Commission in accordance with
\nthe Securities Exchange Act of 1934, as amended, and the rules promulgated
\nthereunder. This foregoing limitation does not bar you from disclosing the terms
\nof this Agreement in any governmental investigation, proceeding or hearing
\nconducted pursuant to law or as otherwise required by law.<\/p>\n
\nand 2 of this Agreement, you agree to release and forever discharge Legg Mason
\nas well as its stockholders, subsidiaries, and other related enterprises, and
\nall of those entities153 stockholders, directors, officers, employees, agents,
\ninsurers, employee benefit plans, fiduciaries, administrators, and successors
\n(past, present and future) (hereinafter “Legg Mason Releasees”) from any and all
\nrights, demands, causes of action, complaints, contracts and other claims
\nwhatsoever, in law or in equity, which you,<\/p>\n
\n
\nhave or may have against the Legg Mason Releasees, including all known, unknown,
\nundisclosed and unanticipated claims occurring before and including the
\neffective date of this Agreement. This includes, but is not limited to, rights
\nand claims which may arise out of or are in any way related to your employment
\nby Legg Mason and the termination of your employment or the Offer Letter and
\nfurther includes, without limitation, rights and claims under Title VII of the
\nCivil Rights Act of 1964, Section 1981 of the Civil Rights Act of 1866, the Age
\nDiscrimination in Employment Act (“ADEA”) as amended by the Older Worker
\nBenefits Protection Act (“OWBPA”), the Equal Pay Act, the National Labor
\nRelations Act, the Employee Retirement Income Security Act (“ERISA”) and any
\nemployee benefit plan sponsored by Legg Mason which is not subject to ERISA, the
\nAmericans with Disabilities Act, the Family and Medical Leave Act, the Maryland
\nHuman Relations Act, the Handicapped Persons Employment Protections Act, and any
\nother federal, state and local laws, regulations and ordinances prohibiting bias
\nand\/or employment discrimination. This also includes, but is not limited to,
\nclaims for violation of Legg Mason policies; wrongful, constructive, or
\nretaliatory discharge; breach of contract or covenant, oral and written, express
\nand implied; common law, and alleged torts; furthermore this includes a release
\nfor any costs or attorneys fees you may have incurred.<\/p>\n
\nclaims that may arise after your execution of this Agreement, claims that may
\narise as a result of this Agreement, or claims that may not be waived as a
\nmatter of law. You do not waive or release any rights and claims that you may
\nhave under the Age Discrimination in Employment Act, as amended, which arise
\nafter the effective date of this Agreement. You do not waive or release any
\nright to receive vested benefits under any retirement plan sponsored by Legg
\nMason. You do not waive rights to unemployment or workers153 compensation
\nbenefits.<\/p>\n
\nadministrative agency (such as the Equal Employment Opportunity Commission), or
\ntestifying, assisting or participating in an investigation, hearing or
\nproceeding conducted by such agency; however, you waive the right to receive any
\nindividualized relief, such as reinstatement, backpay, or other damages, in a
\nlawsuit or administrative action brought by any government agency or individual
\non your behalf. You agree that if there is any complaint filed in any court or
\narbitral forum in which you personally seek reinstatement, damages or other
\nremedies relating to any claim that is covered by this General Release, you will
\nimmediately file a dismissal with prejudice of such claim or remedy.<\/p>\n
\nthe following information is provided:<\/p>\n
\nprovided with a copy of this Agreement and have been given twenty one (21)
\nconsecutive days in which to review and consider the Agreement. You may sign and
\nreturn the Agreement sooner if you prefer.<\/p>\n
\nto signing this Agreement.<\/p>\n
\n
\ncalendar days following the signing of this Agreement to revoke this Agreement.
\nAny such revocation of the Agreement must be made by you and delivered to
\nPatricia Lattin, Legg Mason, 100 International Drive, Baltimore MD 21202, and
\nreceived prior to the end of the revocation period. Any revocation hereunder
\nshall not affect your termination from Legg Mason.<\/p>\n
\nbecome final and binding only upon expiration of the revocation period provided
\nin subparagraph 7(c) above. In other words, the effective date of this Agreement
\nwill be the 8th calendar day after you sign the Agreement, provided that you
\nhave not revoked the Agreement during the revocation period. No payments shall
\nbe made under this Agreement until the Agreement becomes final and binding upon
\nthe parties.<\/p>\n
\nbenefits is an admission by the Legg Mason Releasees of any liability,
\nwrongdoing or unlawful conduct of any kind.<\/p>\n
\nnegative light Legg Mason or its related entities and any of their officers or
\nemployees, services, products, or processes. Legg Mason agrees that the
\nexecutive officers of Legg Mason, Inc. shall not disparage, defame or otherwise
\nrepresent you in a negative light. In addition, if you discover that any
\nemployee of Legg Mason has disparaged, defamed or otherwise represented you in a
\nnegative light, Legg Mason shall instruct such employee(s) to cease and desist
\nsuch behavior. The limitations contained in this paragraph 9 do not bar you, a
\nLegg Mason executive officer or any Legg Mason employee from testifying,
\nassisting or participating in any governmental investigation, proceeding or
\nhearing conducted pursuant to any fair employment practices law or as otherwise
\nrequired by law.<\/p>\n
\ncontroversy relating to this Agreement, your employment or the termination
\nthereof, against any Legg Mason Releasees you agree that, at the option of Legg
\nMason, you will submit to arbitration. If you are associated in any capacity
\nwith a registered broker-dealer, you agree to arbitrate under the Constitution
\nand Rules of the Financial Industry Regulatory Authority, Inc. If you are not
\nassociated with a registered broker-dealer, or the FINRA Arbitration forum is
\nnot otherwise available to you, you agree to arbitrate pursuant to the
\nemployment arbitration rules of the American Arbitration Association.<\/p>\n
\nwhich may not have been completed as of the effective date of this Agreement,
\nand, if requested by Legg Mason, you will cooperate with Legg Mason in
\naccomplishing an orderly transition of your responsibilities, and will provide
\nreasonable assistance to Legg Mason in connection with matters that may arise
\nout of your performance of your duties and responsibilities during your
\nemployment for a period of up to twelve (12) months. Thereafter, if you are
\nasked to provide assistance to Legg<\/p>\n
\n
\nrate of pay of $350 per hour. You shall also be reimbursed for all reasonable
\nexpenses (including travel expenses) incurred by you when providing assistance
\nto Legg Mason under this paragraph 11 at anytime after the Separation Date.<\/p>\n
\nfrom any client of Legg Mason with whom you had substantial contact during your
\nemployment for the purpose of terminating or reducing any business that Legg
\nMason has with any such client. Your agreement not to solicit means that for
\ntwelve (12) months following your termination date, you will not initiate
\ncontact or communication of any kind for the purpose of inviting, encouraging or
\nrequesting any such client to (a) transfer an existing account from Legg Mason
\nto you or any third party or (b) surrender, redeem or terminate any product,
\nservice or relationship with Legg Mason.<\/p>\n
\nagree that during your employment with Legg Mason and for a period of twelve
\n(12) months following the termination of your employment for any reason that you
\nwill not, directly or indirectly, for yourself or on behalf of a third party,
\nsolicit or induce any employee of Legg Mason or its related entities to
\nterminate his\/her employment or to become employed elsewhere.<\/p>\n
\neither directly or tangentially relating to your employment at Legg Mason and
\nits related entities. You agree to appear without the need for a subpoena to
\nprovide deposition testimony and testify at trial and\/or arbitration in
\nconnection with any such litigation at reasonable times and locations. You also
\nagree to cooperate in providing documents and information necessary to assist in
\nthe defense or prosecution of any such case, including reasonable telephone
\ncalls and meetings with Legg Mason counsel. Reasonable travel and other
\nreasonable expenses will be reimbursed by Legg Mason if you are required to
\nprovide assistance under this paragraph 13 on or after your Separation Date.\n<\/p>\n
\ninducements to Legg Mason for the additional consideration being paid hereunder
\nand that any breach of the provisions of those paragraphs shall constitute a
\nmaterial breach of this Agreement entitling Legg Mason to a return of the
\nconsideration paid by Legg Mason, as well as to claim for any further damages
\ncaused by such breach. In addition, Legg Mason may seek injunctive relief to
\nprevent further breaches of those paragraphs.<\/p>\n
\nadministrative agency, court, arbitrator, or other person or body deciding a
\ndispute between the parties hereto, the parties intend and agree that the
\nportion of the Agreement that is deemed invalid shall be severed from the
\nAgreement, and that the remainder of the Agreement shall be valid and binding
\nand interpreted in such a manner as respects the wishes of the Parties as much
\nas possible; provided, however, that if such decision is made invalidating all
\nor any part of Paragraph 6 of this Agreement (other than the release and waiver
\nunder the Age Discrimination in Employment Act) due to a challenge, claim or
\nrequest submitted by you, then this entire Agreement shall be deemed null and
\nvoid and you will be obligated to return to Legg Mason all of the consideration
\n(defined as the market value of the accelerated stock and options described in
\nParagraph 1).<\/p>\n
\n
\nthe parties and supersedes any and all prior agreements or understandings
\npertaining to your employment or the termination thereof with the exception of
\nany confidentiality agreements between you and Legg Mason or its related
\nentities. This Agreement may be modified only in writing and shall be binding
\nupon and inure to the benefit of you, Legg Mason and the respective heirs,
\nexecutors, successors and assigns of each. Your signature to this Agreement will
\nconfirm that you are not relying upon any representations or statements made by
\nLegg Mason or any of its agents, except as set forth herein.<\/p>\n
\nInternal Revenue Code as a short-term deferral, and part of this Agreement is
\nintended to constitute a separation pay arrangement under applicable IRS rules.
\nNothing contained herein shall be deemed to alter the time or manner of any
\npayment, benefit or amount that is deemed to be deferred compensation that is
\nsubject to Section 409A of the Internal Revenue Code, if applicable. By signing
\nthis Agreement you acknowledge and agree that Legg Mason does not make any
\nrepresentations as to the tax consequences of any compensation or benefits
\nprovided hereunder (including, without limitation, under Section 409A of the
\nInternal Revenue Code, if applicable), and that you are solely responsible for
\nany and all income, excise or other taxes imposed on you with respect to any and
\nall compensation or other benefits provided to you.<\/p>\n
\nlaws of the State of Maryland.<\/p>\n
\nPlease sign and return the enclosed copy of this letter in the enclosed postage
\npaid envelope. While I hope that you will accept this offer promptly, it will
\nremain open for 21 days after your receipt of this letter. On the 22nd day
\nfollowing your receipt, the offer shall be deemed withdrawn if it was not
\naccepted during the 21 day period.<\/p>\n
\nthe termination of your employment on the Separation Date. You will not,
\nhowever, be provided with any of the benefits or compensation stated above.<\/p>\n
\nthe future.<\/p>\n\n\n
\n <\/td>\n \n \n <\/td>\n <\/td>\n<\/tr>\n \n <\/td>\n \n \n <\/td>\n <\/td>\n<\/tr>\n \n <\/td>\n \n \n <\/td>\n \n \n <\/td>\n \n
\n
\nSIGN AND ENTER INTO IT, INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS I HAVE
\nOR MIGHT HAVE AGAINST THE LEGG MASON RELEASEES EXISTING AS OF THE DATE THIS
\nAGREEMENT IS SIGNED.<\/p>\n\n\n
\n \n <\/td>\n<\/tr>\n \n \n <\/td>\n<\/tr>\n \n <\/td>\n <\/td>\n<\/tr>\n \n \n <\/td>\n<\/tr>\n \n \n <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
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