watchdog: basic configuration options don't work as expected

I run ubuntu 14.04 LTS and watchdog 5.13. My goal is to achieve following:

• run external check script every 30 seconds
• reboot if script fails during 300 seconds (e.g. 10 failed attempts in a row)

I am having issues with the most basic watchdog configuration:

$ cat /etc/watchdog.conf
watchdog-device = /dev/watchdog
watchdog-timeout = 300
interval = 30
test-binary = /usr/local/sbin/watchdog_check.sh
realtime = yes
priority = 1

$ cat /etc/default/watchdog
run_watchdog=1
run_wd_keepalive=1
watchdog_module="none"
watchdog_options="-c /etc/watchdog.conf --verbose"

According to syslog,

1. watchdog-timeout is being set to 254s (discussed here).
2. System reboots after first failure of test-binary.

Is it an expected behaviour or am I missing something?

P.S. At this moment I've implemented a 'wait until 10 failures' logic in my script itself.