Obligations of the Company Upon Termination (a) By the Company Other Than for Cause, Death or Disability; By the Executive for Good Reason. Subject to Section 5, if, during the Employment Period, (x) the Company shall terminate the Executive’s employment other than for Cause, death or Disability or (y) the Executive shall terminate employment for Good Reason:
(i) the Company shall pay to the Executive the following amounts:
(A) a lump sum cash payment within 30 days after the Date of Termination equal to the aggregate of the following amounts: (1) the Executive’s Annual Base Salary and vacation pay through the Date of Termination, (2) the Executive’s accrued Annual Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs (other than any portion of such Annual Bonus that was previously deferred, which portion shall instead be paid in accordance with the applicable deferral election) if such bonus has not been paid as of the Date of Termination, and (3) the Executive’s business expenses that have not been reimbursed by the Company as of the Date of Termination that were incurred by the Executive prior to the Date of Termination in accordance with the applicable Company policy, in the case of each of clauses (1) through (3), to the extent not previously paid (the sum of the amounts described in clauses (1) through (3) shall be hereinafter referred to as the “Accrued Obligations”); and
(B) subject to the Executive’s delivery (and non-revocation) of an executed release of claims against the Company and its officers, directors, employees and affiliates in substantially the form attached hereto as Exhibit A (the “Release”), which Release must be delivered to the Company not later than 22 days after the Date of Termination (or such longer period of time permitted by the Company, but in no event later than the latest business day that is not more than two months after the end of the calendar year in which the Date of Termination occurs) (the “Release Deadline”), an amount equal to the sum of (x) the product of two times the Executive’s Annual Base Salary, plus (y) the product of 0.75 times the Executive’s Target Bonus as in effect for the fiscal year of the Company in which the Date of Termination occurs, payable in a lump sum within 30 days after the Date of Termination; and
(ii) if the Executive makes a timely election to receive COBRA coverage under Section 4980B of the Code, the Company will pay the cost of such coverage during the period it remains in effect, not to exceed 18 months following the Date of Termination (the benefits provided pursuant to this Section 4(a)(ii), the “Post-Employment Health Care Benefits”);
(iii) if the Date of Termination occurs on or after the second anniversary of the Effective Date, all remaining unvested shares of the Promotion Restricted Stock will vest. If the Date of Termination occurs prior to the second anniversary of the Effective Date, a number of the unvested shares of the Promotion Restricted Stock will vest equal to the sum of (i) 33,333 shares of Promotion Restricted Stock plus (ii) 33,333 shares of Promotion Restricted Stock multiplied by a fraction, the numerator of which is the number of days from the latest anniversary of the Effective Date through the date of termination, and the denominator of which is 365 (rounded down to the nearest whole share). Any shares of the Promotion Restricted Stock which are not vested as of the Date of Termination (after application of this Section 4(a)(iii)) shall be forfeited immediately upon the Date of Termination. The benefits provided pursuant to this Section 4(a)(iii) (the “Equity Award Vesting Benefits”) shall be subject to the Executive’s delivery of an executed Release prior to the Release Deadline (and non-revocation thereof); and
(iv) to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any other amounts or benefits required to be paid or provided or that the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies through the Date of Termination (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”). Notwithstanding the foregoing provisions of Section 4(a)(i), in the event that the Executive is a “specified employee” (within the meaning of Section 409A of the Code and with such classification to be determined in accordance with the methodology established by the applicable employer) (a “Specified Employee”), amounts and benefits (other than the Accrued Obligations) that are deferred compensation (within the meaning of Section 409A of the Code) that would otherwise be payable or provided under Section 4(a)(i) during the six-month period immediately following the Date of Termination shall instead be paid, with interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code (“Interest”), on the first business day after the date that is six months following the Date of Termination (the “409A Payment Date”). For the avoidance of doubt, the parties hereto acknowledge that the severance payments and benefits described in this Agreement are intended to be exempt from the operation of Section 409A of the Code and not “deferred compensation” within the meaning of Section 409A.
