Common use of Compensation Upon a Change in Control Clause in Contracts

Compensation Upon a Change in Control. If the Executive is an employee of the Company at the moment immediately prior to a Change in Control of the Company, the Executive shall be entitled to receive the compensation set forth below. (a) The Company shall pay to the Executive, not later than the third business day following the date of any Change in Control of the Company, a lump sum severance payment (the "Severance Payment") equal to two (2) times the Base Amount (as defined below). For purposes of this Section 7.2(a), the Base Amount shall mean the Executive's then Annual Compensation (as defined below) during the calendar year period preceding the calendar year in which the Change in Control of the Company occurs. For purposes of determining Annual Compensation in the preceding sentence, there shall be included (i) all Base Compensation and bonuses paid or payable to the Executive by the Company with respect to the preceding calendar year, (ii) all grants of restricted shares of common stock, par value $.01 per share, of the Company (the "Shares"), if any, with respect to such preceding calendar year, which Shares shall be valued based on their date of grant Fair Market Value (as defined in Section 10.2 of the Company's 1998 Incentive Plan or any other plan or agreement pursuant to which they are issued), and (iii) the fair market value of any other property or rights given or awarded to the Executive by the Company with respect to such preceding calendar year. (b) Any Shares now or hereafter issued to the Executive pursuant to any restricted Share grant shall vest immediately prior to the date of a Change in Control of the Company and no longer be subject to repurchase or any other forfeiture restrictions. (c) The Company shall maintain in full force and effect for the Executive's continued benefit for 18 months following a Change in Control of the Company, all life, accident, medical and dental insurance benefit plans and programs or arrangements in which the Executive was entitled to participate immediately prior to the date of a Change in Control of the Company; provided that the Executive's continued participation is possible under the general terms and provisions of such plans and programs. In the event that the Executive's participation in any such plan or program is barred, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive was entitled to receive under such plans and programs. At the end of the period of coverage, the Executive shall have the option to have assigned to him at no cost to the Executive and with no apportionment of prepaid premiums, any assignable insurance policy owned by the Company and relating specifically to the Executive. (i) The Executive shall be entitled to receive additional compensation in the form of cash equal to, on the date of a Change in Control of the Company and with respect to each Option to purchase Shares held by the Executive whether or not such Option has vested or is exercisable on such date (an "Option"), the number of Shares underlying the Option, multiplied by the amount, if any, that the exercise price of the Option or the Closing Share Value (as defined below), whichever is less, exceeds the Initial Share Value (as defined below). (ii) With respect to each Option, in the event that the Closing Share Value is greater than the exercise price of such Option, then the Executive can (1) retain the Option, or (2) forfeit the Option and receive, in exchange therefor, a cash payment equal to the number of Shares underlying the Option multiplied by the amount that the Closing Share Value exceeds the exercise price of the Option. (iii) For purposes of this subsection (d), the "Initial Share Value" of an Option shall mean the average of the Closing Prices of the Shares for the period commencing on the 180th day prior to the date of the Change in Control of the Company and ending on the 150th day prior to the date of the Change in Control of the Company, and the "Closing Share Value" shall mean the Closing Price of the Shares on the date of the Change in Control of the Company. For purposes of this subsection (d), the "Closing Price" of a Share on any date shall mean the last sale price, regular way, or, in case no such sale takes place on such date, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Shares are listed or admitted to trading or, if the Shares are not listed or admitted to trading on any national securities exchange, the last quoted price, or if not so quoted, the average of the highest bid and lowest ask prices in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System or, if such system is no longer used, the principal other automated quotation system that may then be in use or, if the Shares are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making the market in the Shares as such person is selected from time to time by the Board of Directors of the Company or, if there are no professional market makers making a market in the Shares, then the value as determined in good faith judgement of the Board of Directors of the Company.