Benefits Upon a Change in Control. Reyn▇▇▇▇ ▇▇▇ognizes that the threat of a Change in Control would be of significant concern to Nevi▇. ▇▇e following provisions provide termination protection for Nevi▇ ▇▇ the event of a Change in Control. These provisions, among other purposes, are intended to fost▇▇ ▇▇▇ encourage Nevi▇'▇ ▇▇▇tinued attention and dedication to his duties in the event of such potentially disturbing and disruptive circumstances. Reyn▇▇▇▇, ▇▇erefore, agrees to do the following: (i) If Reyn▇▇▇▇ ▇▇▇minates Nevi▇'▇ ▇▇▇loyment for any reason other than a Discharge for Cause, or if Nevi▇ ▇▇▇minates his employment with Reyn▇▇▇▇ ▇▇▇untarily for any reason other than disability or retirement within the twenty-four (24) month period following a Change in Control, Nevi▇ ▇▇▇ll be entitled to receive from Reyn▇▇▇▇ ▇▇▇ following benefits: (A) A lump sum severance payment (the "Severance Payment"), in cash, equal to three (3) times the sum of (i) the higher of Nevi▇'▇ ▇▇▇ual Base Compensation in effect immediately prior to the occurrence of the event or circumstance upon which such termination of employment is based or in effect immediately prior to the Change in Control, and (ii) the average of Nevi▇'▇ ▇▇▇uses during the three (3) calendar years immediately preceding the year in which the date of termination occurs. (B) Nevi▇ ▇▇▇ll be entitled, during the period expiring on the earlier of Nevi▇'▇ ▇▇▇uring other employment or twenty-four (24) months from the date of such termination of employment (or such longer period as required by law), to continued coverage under the Reyn▇▇▇▇ sponsored medical benefits program in existence on such date of termination or, if such continued coverage is barred, Reyn▇▇▇▇ ▇▇▇ll provide equivalent medical benefit coverage through the purchase of insurance or otherwise. (C) For purposes of determining Nevi▇'▇ ▇▇▇efits under the Supplemental Plan, Nevi▇ ▇▇▇ll receive credit toward his Years of Service under the Supplemental Plan for the two (2) year period following such termination of employment. In addition, with respect to the two (2) year period following such termination of employment, Nevi▇'▇ ▇▇▇e Compensation shall be deemed to be increased by the annual economic range adjustment for Reyn▇▇▇▇' ▇▇laried employees announced in October of each year (or, if there is no such announced economic range adjustment in a given year, by an assumed five percent (5%) increase for that year) in order to calculate his highest earnings during five (5) consecutive years out of the last ten (10) years prior to retirement under the Supplemental Plan. (D) Nevi▇ ▇▇▇ll be reimbursed for up to $20,000 for outplacement fees if he chooses to seek other employment following his discharge by Reyn▇▇▇▇. ▇▇vi▇ ▇▇▇ll not be obligated to seek other employment in order to mitigate his damages resulting from his discharge. (E) In addition to all of the foregoing, Nevi▇ ▇▇▇ll be entitled to receive the payments required of Reyn▇▇▇▇ ▇▇▇er his then-existing deferred compensation agreement(s) with Reyn▇▇▇▇ ▇▇ accordance with the terms of such agreement(s). The benefits provided in this Section 8(e) shall be in lieu of any benefits provided under Section 8(d) of this Agreement. (ii) Notwithstanding any other provisions of this Agreement, in the event that any payment or benefit received or to be received by Nevi▇ ▇▇ connection with a Change in Control or
Appears in 1 contract
Benefits Upon a Change in Control. Reyn▇▇▇▇ ▇▇▇ognizes Reynolds recognizes that the threat of a Change in Control would be of significant b▇ ▇▇ ▇▇▇nificant concern to Nevi▇Employee. ▇▇e The following provisions provide termination protection for Nevi▇ ▇▇ Employee in the event of a Change in Control. These provisions, among other purposes, are intended to fostfoster and encourage Employee's continued attention and dedication ▇▇ ▇▇▇ encourage Nevi▇'▇ ▇▇▇tinued attention and dedication to his s duties in the event of such potentially disturbing and disruptive circumstances. Reyn▇▇▇▇Reynolds, ▇▇ereforetherefore, agrees to do the following:
(i) If Reyn▇▇▇▇ ▇▇▇minates Nevi▇'Employee's employment for any reason other tha▇ ▇ ▇▇▇loyment for any reason other than a Discharge ▇harge for Cause, or if Nevi▇ ▇▇▇minates Employee terminates his employment with Reyn▇▇▇▇ ▇▇▇untarily Reynolds voluntarily for any reason other than disability or retirement within retir▇▇▇▇▇ ▇▇thin the twenty-four (24) month period following a Change in Control, Nevi▇ ▇▇▇ll Employee shall be entitled to receive from Reyn▇▇▇▇ ▇▇▇ Reynolds the following benefits:
(A) A lump sum severance payment severanc▇ ▇▇▇▇▇▇t (the "Severance Payment"), in cash, equal to three (3) times the sum of (i) the higher of Nevi▇'▇ ▇▇▇ual Employee's annual Base Compensation in effect immediately prior to the occurrence of the event or circumstance upon which such termination of employment is based or in effect immediately prior to the Change in Control, and (ii) the average of Nevi▇'▇ ▇▇▇uses Employee's Bonuses during the three (3) calendar years immediately preceding the year in which the date of termination occurs.
(B) Nevi▇ ▇▇▇ll Employee shall be entitled, during the period expiring on the earlier of Nevi▇'▇ ▇▇▇uring his securing other employment or twenty-four (24) months from the date of such termination of employment (or such longer period as required by law), to continued coverage under the Reyn▇▇▇▇ Reynolds sponsored medical benefits program in existence on such date of termination d▇▇▇ ▇▇ ▇ermination or, if such continued coverage is barred, Reyn▇Reynolds shall provide equivalent medical benefit coverage through ▇▇▇ ▇▇▇ll provide equivalent medical benefit coverage through the purchase chase of insurance or otherwise.
(C) For purposes of determining Nevi▇'▇ ▇▇▇efits Employee's benefits under the Supplemental Plan, Nevi▇ ▇▇▇ll Employee shall receive credit toward his Years of Service under the Supplemental Plan for the two (2) year period following such termination of employment. In addition, with respect to the two (2) year period following such termination of employment, Nevi▇'▇ ▇▇▇e Employee's Base Compensation shall be deemed to be increased by the annual economic range adjustment for Reyn▇▇▇▇Reynolds' ▇▇laried salaried employees announced in October of each year (or, if there ▇▇ ▇▇▇re is no such announced economic range adjustment in a given year, by an assumed five percent (5%) increase for that year) in order to calculate his highest earnings during five (5) consecutive years out of the last ten (10) years prior to retirement under the Supplemental Plan.
(D) Nevi▇ ▇▇▇ll Employee shall be reimbursed for up to $20,000 for outplacement fees if he chooses to seek other employment following his discharge by Reyn▇▇▇▇Reynolds. ▇▇vi▇ ▇▇▇ll Employee shall not be obligated to seek other employment in order ▇▇ ▇▇▇▇r to mitigate his damages resulting from his discharge.
(E) In addition to all of the foregoing, Nevi▇ ▇▇▇ll Employee shall be entitled to receive the payments required of Reyn▇▇▇▇ ▇▇▇er Reynolds under his then-existing deferred compensation agreement(s) with Reyn▇▇▇▇ ▇▇ eynolds in accordance with the terms of such agreement(s), and th▇ ▇▇▇▇▇▇ment benefit provided for in Section 5 of this Agreement. The benefits provided in this Section 8(e7(e) shall be in lieu of any benefits provided under Section 8(d7(d) of this Agreement.
(ii) Notwithstanding any other provisions of this Agreement, in the event that any payment or benefit received or to be received by Nevi▇ ▇▇ Employee in connection with a Change in Control oror the termination of Employee's employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with Reynolds, any person whose actions result in a Change in Control o▇ ▇▇▇ ▇▇rson affiliated with Reynolds or such person) (all such payments and benefits, includin▇ ▇▇▇ ▇▇verance Payment, being hereinafter called "Total Payments") would be subject (in whole or part), to an excise tax pursuant to Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (the "Code") (such tax hereinafter referred to as the "Excise Tax"), then the Severance Payment shall be reduced to the extent necessary so that no portion of the Total Payments is subject to Excise Tax (after taking into account any reduction in the Total Payments provided by reason of Section 280G of the Code in such other plan, arrangement or agreement) if (A) the net amount of such Total Payments, as so reduced, (and after deduction of the net amount of federal, state and local income tax on such Total Payments), is greater than (B) the excess of (i) the net amount of such Total Payments, without reduction (but after deduction of the net amount of federal, state and local income tax on such Total Payments), over (ii) the amount of Excise Tax to which Employee would be subject in respect of such Total Payments. For purposes of determining whether and the extent to which the Total Payments will be subject to the Excise Tax, (i) no portion of the Total Payments the receipt or enjoyment of which Employee shall have effectively waived in writing prior to the date of this termination of employment shall be taken into account, (ii) no portion of the Total Payments shall be taken into account which in the opinion of tax counsel selected by Reynolds does not constitute a "parachute payment" within the mean▇▇▇ ▇▇ ▇ection 280G(b)(2) of the Code, (including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax, no portion of such Total Payment shall be taken into account which constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the base amount as defined in Section 280G(b)(3) of the Code allowable to such reasonable compensation, and (iii) the value of any non-cash benefit or any deferred payment or benefit included in the Total Payments shall be determined by Reynolds in accordance with the principles of Sections 280G(d)(3) ▇▇▇ (▇) of the Code. Prior to the fifth day following the date of Employee's termination of employment, Reynolds shall provide Employee with its calculation of the amount▇ ▇▇▇▇▇▇ed to in this Section and such supporting materials as are reasonably necessary for Employee to evaluate Reynolds' calculations. If Employee objects to Reynolds' calculations, he shall notify Reynolds of his objections ▇▇▇▇▇ ▇o the initial payment date set f▇▇▇▇ ▇▇ Section 7(e)(vi) hereof, and Reynolds shall pay to Employee such portion of the Severance Payme▇▇ (▇▇ ▇o one hundred percent (100%) thereof) as Employee determines is necessary to result in Employee's receiving the greater of clauses (A) and (B) of this Section.
(iii) Upon the occurrence of an Escrow Funding Event, Reynolds shall pay into an escrow account at the Escrow Agent an a▇▇▇▇▇ ▇▇ual to three (3) times the sum of (i) Employee's Base Compensation in effect immediately prior to the Escrow Funding Event and (ii) the average of Employee's Bonuses during the three (3) calendar years immediately preceding the year in which the Escrow Funding Event occurs. Subsequent to the delivery to the Escrow Agent of the Escrow Amount, Reynolds shall, in the event that either Employee's Base Compensat▇▇▇ ▇▇ ▇ncreased (or decreased) or he receives a Bonus that affects the amount described in Section 7(e)(i)(A), unless the Escrow Amount shall theretofore have been released pursuant to this subsection, recalculate the Escrow Amount as of the date such change in Base Compensation or receipt of Bonus occurs, treating the Escrow Funding Event as having occurred on such date. If the amount so calculated exceeds the fair market value of the Escrow Amount, Reynolds shall promptly (and in no event later than seven (7) days ▇▇▇▇ ▇▇ch date) pay to the Escrow Agent an amount in cash (or marketable securities or any combination thereof) equal to such excess. If the Escrow Amount so calculated is less than the fair market value of the Escrow Amount then held in the escrow account, the Escrow Agent, upon receipt of a written request from Reynolds, shall distribute to Reynolds such difference in cash; pr▇▇▇▇▇▇, however, that this sen▇▇▇▇▇ ▇▇all not apply after the occurrence of a Change in Control.
(iv) Unless the parties otherwise agree, Reynolds may withdraw the Escrow Amount when and only when two (2) ▇▇▇▇▇ ▇ave expired from the date of deposit and no proper demand pursuant to Section 7(e)(vi) below has been made during the time, or when the conditions requiring the deposit have ceased to exist for a period of ninety (90) days without a demand right having been created, or when Employee's right to a payment under this Section 7(e) has been forfeited, whichever occurs first. If, before the expiration of such period or forfeiture, there shall occur another Escrow Funding Event, Reynolds will not be required to make an additional deposit, but t▇▇ ▇▇▇ (2) year period shall then be measured from the date of the last such event. Notwithstanding a deposit with the Escrow Agent pursuant to subsection (iii) of this Section 7(e), Employee shall continue to be entitled to receive all of the benefits from Reynolds under this Agreement until a termination of employment sh▇▇▇ ▇▇▇▇r.
(v) Reynolds shall pay the charges of the Escrow Agent for its service▇ ▇▇▇▇▇ the Escrow Agreement, and Reynolds will be entitled to any interest or other income arising ▇▇▇▇ ▇▇▇ date of the deposit of the Escrow Amount until all payments have been made under the Escrow Agreement to Employee. All interest or other income arising from the Escrow Amount deposited with the Escrow Agent shall be paid monthly to Reynolds.
(vi) If Reynolds terminates Employee's employment ▇▇▇ ▇▇▇ reason but a Dis▇▇▇▇▇▇ ▇or Cause, or if Employee terminates his employment with Reynolds voluntarily for any reason other than disability or retir▇▇▇▇▇ ▇▇thin the twenty-four (24) month period following the date of a Change in Control, the Escrow Agent, upon written demand made on or after the tenth (10th) day following such termination of employment, shall pay the Escrow Amount in accordance with this Section and Employee shall no longer be subject to the restrictive provisions of Section 8 below, except for Section 8(e). Employee shall notify the Escrow Agent prior to the tenth (10th) day following his termination of employment as to whether he has accepted the determination of Reynolds of the amount of the Severance Payments pursuant to Section 7(e) (iii). If he has accepted such determination, Reynolds shall provide the Escrow Agent with Reynolds' written det▇▇▇▇▇▇▇▇on as set forth in Section 7(e) (iii) ▇▇▇ ▇▇▇ Escrow Agent shall pay to Employee all or a portion of the Escrow Amount as provided in such determination, and any remaining amount shall be paid to Reynolds. If Employee does not accept Reynolds' determination, Emp▇▇▇▇▇ ▇▇all provide to the Escrow Agen▇ ▇▇▇ ▇▇termination of the Severance Payment, and the Escrow Agent shall pay to Employee all or a portion of the Escrow Amount as provided in Employee's determination and any remaining amount shall be paid to Reynolds.
(vii) In the event that, following the creation of ▇ ▇▇▇▇▇d right pursuant to Section 7(e)(vi) above, Employee incurs any costs or expenses, including attorneys' fees, in the enforcement of rights under this Section 7(e) or under any plan for the benefit of employees of Reynolds, including without limitation the stock option plan, pens▇▇▇ ▇▇▇▇s, payroll-based stock ownership plan, tax deferred savings and protection plan, bonus arrangements, supplemental pension plan, deferred compensation agreements, incentive compensation plans, and life insurance and compensation program, then, unless Reynolds or the consolidated, surviving or transferee entity in th▇ ▇▇▇▇▇ of a consolidation, merger or sale of assets, is wholly successful in defending against the enforcement of such rights, Reynolds, or such consolidated, surviving or transferee entity, sh▇▇▇ ▇▇▇▇ptly pay to Employee all such costs and expenses.
Appears in 1 contract
Benefits Upon a Change in Control. Reyn▇▇▇▇ ▇▇▇ognizes that the threat of a Change in Control would be of significant concern to NeviHede▇▇. ▇▇e following provisions provide termination protection for NeviHede▇▇ ▇▇ the event of a Change in Control. These provisions, among other purposes, are intended to fost▇▇ ▇▇▇ encourage NeviHede▇▇'▇ ▇▇▇tinued attention and dedication to his duties in the event of such potentially disturbing and disruptive circumstances. Reyn▇▇▇▇, ▇▇erefore, agrees to do the following:
(i) If Reyn▇▇▇▇ ▇▇▇minates NeviHede▇▇'▇ ▇▇▇loyment for any reason other than a Discharge for Cause, or if NeviHede▇▇ ▇▇▇minates his employment with Reyn▇▇▇▇ ▇▇▇untarily for any reason other than disability or retirement within the twenty-four (24) month period following a Change in Control, NeviHede▇▇ ▇▇▇ll be entitled to receive from Reyn▇▇▇▇ ▇▇▇ following benefits:
(A) A lump sum severance payment (the "Severance Payment"), in cash, equal to three (3) times the sum of (i) the higher of NeviHede▇▇'▇ ▇▇▇ual Base Compensation in effect immediately prior to the occurrence of the event or circumstance upon which such termination of employment is based or in effect immediately prior to the Change in Control, and (ii) the average of NeviHede▇▇'▇ ▇▇▇uses during the three (3) calendar years immediately preceding the year in which the date of termination occurs.
(B) NeviHede▇▇ ▇▇▇ll be entitled, during the period expiring on the earlier of NeviHede▇▇'▇ ▇▇▇uring other employment or twenty-four (24) months from the date of such termination of employment (or such longer period as required by law), to continued coverage under the Reyn▇▇▇▇ sponsored ▇▇▇nsored medical benefits program in existence on such date of termination or, if such continued coverage is barred, Reyn▇▇▇▇ ▇▇▇ll provide equivalent medical benefit coverage through the purchase of insurance or otherwise.
(C) For purposes of determining Nevi▇'▇ ▇▇▇efits under the Supplemental Plan, Nevi▇ ▇▇▇ll receive credit toward his Years of Service under the Supplemental Plan for the two (2) year period following such termination of employment. In addition, with respect to the two (2) year period following such termination of employment, Nevi▇'▇ ▇▇▇e Compensation shall be deemed to be increased by the annual economic range adjustment for Reyn▇▇▇▇' ▇▇laried employees announced in October of each year (or, if there is no such announced economic range adjustment in a given year, by an assumed five percent (5%) increase for that year) in order to calculate his highest earnings during five (5) consecutive years out of the last ten (10) years prior to retirement under the Supplemental Plan.
(D) Nevi▇ ▇▇▇ll be reimbursed for up to $20,000 for outplacement fees if he chooses to seek other employment following his discharge by Reyn▇▇▇▇. ▇▇vi▇ ▇▇▇ll not be obligated to seek other employment in order to mitigate his damages resulting from his discharge.
(E) In addition to all of the foregoing, Nevi▇ ▇▇▇ll be entitled to receive the payments required of Reyn▇▇▇▇ ▇▇▇er his then-existing deferred compensation agreement(s) with Reyn▇▇▇▇ ▇▇ accordance with the terms of such agreement(s). The benefits provided in this Section 8(e) shall be in lieu of any benefits provided under Section 8(d) of this Agreement.
(ii) Notwithstanding any other provisions of this Agreement, in the event that any payment or benefit received or to be received by Nevi▇ ▇▇ connection with a Change in Control orcontinued
Appears in 1 contract