Termination Without Cause or by Executive for Good Reason. In the event that prior to the expiration of the Term, Corporation terminates Executive’s employment with Corporation without Cause under Section 5.5 or Executive terminates his employment for Good Reason under Section 5.4, Executive will be entitled to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for the fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved on or before the date of termination, as determined by the Compensation Committee as provided in Section 2.2. Corporation also will continue to provide or will arrange to provide (at Corporation’s cost) Executive with medical and dental insurance benefits substantially similar to those to which Executive was entitled as of the date of termination for a period of 12 months following the date of termination; provided, however, that if Executive is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporation’s obligation to provide such medical and dental benefits will terminate automatically. In addition, to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (a) the portion of the Stock Option scheduled to vest in the year of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictions, in the amount of (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010, (ii) 54,000 shares of Common Stock if termination occurs on or after July 1, 2010, and on or prior to June 30, 2011, and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefits, and to accelerate vesting of the Stock Option and Restricted Stock Award as described above are expressly conditioned on (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries or affiliates, and (ii) the expiration of any applicable revocation period specified in such release without revocation of the release by Executive. Corporation’s obligation to provide medical and dental insurance benefits to Executive will terminate if Executive breaches a provision of Section 3.
Appears in 1 contract
Sources: Employment Agreement (Rentrak Corp)
Termination Without Cause or by Executive for Good Reason. In (a) The Company reserves the event that prior right to the expiration of the Term, Corporation terminates terminate Executive’s employment with Corporation without at any time. If, however, a Termination Date occurs (not including termination in the ordinary course on any applicable June 30 if the term of this Agreement is not automatically renewed which circumstance is covered by Section 4.6(b)) for any reason other than Cause under Section 5.5 or 4.5, termination by Executive terminates his employment for Good Reason under Section 5.44.7, Executive will be entitled death, or Disability (which is covered by Section 4.4), then Company shall have no further obligations under this Agreement except that Company shall pay to Executive:
(i) the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump sum to Accrued Base Obligations through the date of termination, payable promptly after the date of termination,
(ii) any unpaid Performance Bonus earned for any fiscal year ended before the Termination Date payable the later of (A) the date on which such Performance Bonus would be paid within absent termination and (B) a date no later than 30 days following termination. Executive will also be entitled to be paidafter the Termination Date,
(iii) the Performance Bonus, in a lump sum payable within 30 days following terminationif any is earned, all or a portion of the cash bonus described in Section 2.2 above for the fiscal year in which such termination occurs based on the extent Termination Date occurs, allocable to which and prorated for the period prior to termination, calculated by annualizing any short period before termination, calculated and payable when Performance Bonuses for the applicable performance measures for that fiscal year had been achieved on or before the date of termination, as determined by the are paid to all other Company senior executives,
(iv) Base Compensation Committee as provided in Section 2.2. Corporation also will continue to provide or will arrange to provide through and including: (at Corporation’s cost) Executive with medical and dental insurance benefits substantially similar to those to which Executive was entitled as of the date of termination for a period of 12 months following the date of termination; provided, however, that if Executive is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporation’s obligation to provide such medical and dental benefits will terminate automatically. In addition, to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (aA) the portion 12-month anniversary of the Stock Option scheduled to vest in the year of his termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictions, in the amount of (i) 36,000 shares of Common Stock if his termination occurs on or prior to before June 30, 20102006, (iiB) 54,000 shares the 15-month anniversary of Common Stock his termination if his termination occurs between July 1, 2006 and June 30, 2007, (C) the 18-month anniversary of his termination if his termination occurs between July 1, 2007 and June 30, 2008, and (D) the 24-month anniversary of his termination if his termination occurs on or after July 1, 20102008, in each case payable at the same times as paid under Section 3.1; and
(v) benefits as required by Section 3.3 of this Agreement during the same period that Base Compensation is due under Section 4.6(a)(iv); provided, however, if Executive, Executive’s spouse or Executive’s dependents are ineligible to participate in the Company benefit programs under Section 3.3, the Company shall arrange to provide Executive, Executive’s spouse and Executive’s dependents with the economic equivalent of such benefits which they otherwise would have been entitled to receive, and further provided that such benefits shall terminate upon the date or dates Executive receives coverage and benefits which are substantially similar, taken as a whole, without waiting period or pre-existing condition limitations, under the plans and programs of a subsequent employer.
(b) If this Agreement is terminated in the ordinary course on or prior any applicable June 30 because of a non-renewal notice given by the Company under Section 2.1, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the payments to which the Executive would be entitled under Section 4.6(a)(i), (ii), (iii), and (iv) and shall provide the benefits to which the Executive would be entitled under Section 4.6(a)(v). If this Agreement is terminated in the ordinary course on any applicable June 3030 because of a non-renewal notice given by the Executive under Section 2.1, 2011then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the payments to which the Executive would be entitled under Section 4.6(a)(i), (ii), and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefits, and to accelerate vesting of the Stock Option and Restricted Stock Award as described above are expressly conditioned on (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries or affiliates, and (ii) the expiration of any applicable revocation period specified in such release without revocation of the release by Executive. Corporation’s obligation to provide medical and dental insurance benefits to Executive will terminate if Executive breaches a provision of Section 3).
Appears in 1 contract
Termination Without Cause or by Executive for Good Reason. In (a) The Company reserves the event that prior right to the expiration of the Term, Corporation terminates terminate Executive’s employment with Corporation at any time. If, however, a Termination Date occurs due to Company terminating Executive without Cause or Executive terminating for Good Reason, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the amounts shown in Section 5.5 4.6(c).
(b) For the avoidance of doubt, Section 4.6(c) shall not apply to (i) termination in the ordinary course on any applicable June 30 if the term of this Agreement is not automatically renewed, which circumstance is covered by Section 4.6(d), (ii) termination for Cause which circumstance is covered by Section 4.5, (iii) termination by Executive without Good Reason which circumstance is covered by Section 4.7, (iv) termination by reason of death which circumstance is covered by Section 4.3, or (v) termination by reason of Disability which circumstance is covered by Section 4.4.
(c) If Company terminates Executive without Cause or Executive terminates his employment with Good Reason, then the Company shall pay to Executive:
(i) the Accrued Base Obligations through the Termination Date, payable promptly after the Termination Date,
(ii) any unpaid Performance Bonus earned for Good Reason under Section 5.4, Executive will be entitled to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for the any fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved ended on or before the Termination Date payable on the date on which such Performance Bonus would be paid absent termination,
(iii) Accrued Bonus Obligations,
(iv) any payments due under Section 4.12.
(d) If this Agreement is terminated in the ordinary course on any applicable June 30 because of termination, as determined a non-renewal notice given by the Compensation Committee Company under Section 2.1, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the same payments as provided in Section 2.2. Corporation also will continue to provide or will arrange to provide (at Corporation’s cost) Executive with medical and dental insurance benefits substantially similar to those to which the Executive was would be entitled as of the date of termination for a period of 12 months following the date of termination; providedunder Section 4.6(c)(i), however(ii), that if Executive and (iv). If this Agreement is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporation’s obligation to provide such medical and dental benefits will terminate automatically. In addition, to the extent not previously vested and as reflected terminated in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (a) the portion ordinary course on any applicable June 30 because of the Stock Option scheduled to vest in the year of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered a non-renewal notice given by the Restricted Stock Award Executive under Section 2.1, then Company shall vest and shares of Common Stock will have no further obligations under this Agreement except that Company shall pay to Executive the payments to which the Executive would be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictions, in the amount of (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010entitled under Section 4.6(c)(i), (ii) 54,000 shares of Common Stock if termination occurs on or after July 1, 2010, and on or prior to June 30, 2011, and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefits, and to accelerate vesting of the Stock Option and Restricted Stock Award as described above are expressly conditioned on (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries or affiliates, and (ii) the expiration of any applicable revocation period specified in such release without revocation of the release by Executive. Corporation’s obligation to provide medical and dental insurance benefits to Executive will terminate if Executive breaches a provision of Section 3iv).
Appears in 1 contract
Termination Without Cause or by Executive for Good Reason. In the event that prior to during the expiration of Employment Term the Term, Corporation terminates Executive’s employment with Corporation is terminated by the Company without Cause under Section 5.5 or the Executive terminates his employment for Good Reason under Section 5.4Reason, Executive will be entitled the Company shall pay to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump the sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for following amounts:
(A) all amounts fully earned pursuant to the fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved on or before terms of this Agreement, but unpaid hereunder through the date of termination, as determined by if any, in respect of Salary, any accrued but not yet paid Annual Performance Bonus owed for the Compensation Committee as provided in Section 2.2. Corporation also will continue year prior to provide Executive’s termination, vesting of any previously issued stock options or will arrange to provide (at Corporation’s cost) Executive with medical restricted stock, payment of life, health and dental disability insurance benefits substantially similar to those to which Executive was entitled as of the date of termination coverage for a period of 12 months five (5) years following the date of termination, and unreimbursed expenses; provided, however, that if Executive is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporationthe Company’s obligation to pay life, health and/or disability insurance shall terminate prior to such fifth year anniversary if Executive accepts other employment that would reasonably be expected to provide such medical insurance;
(B) a severance payment equal to three (3) times the Executive’s combined Salary and dental benefits actual bonus compensation for the preceding fiscal year will terminate automatically. In addition, be paid within five (5) days of the Executive’s last day of employment; and
(C) Anything in this Agreement to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (a) the portion of the Stock Option scheduled to vest in the year of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictionscontrary notwithstanding, in the amount of event it shall be determined that (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010, (ii) 54,000 shares of Common Stock if termination occurs on or after July 1, 2010, and on or prior to June 30, 2011, and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefitsaward, and to accelerate vesting benefit or distribution (or any acceleration of payment, award, benefit or distribution) by the Stock Option and Restricted Stock Award as described above are expressly conditioned on Company (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries affiliates) to or affiliatesfor the benefit of the Executive (whether pursuant to the terms of this Agreement or otherwise) the (“Payments”) would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), and (ii) the expiration reduction of the amounts payable to the Executive under this Agreement to the maximum amount that could be paid to the Executive without giving rise to the Excise Tax (the “Safe Harbor Cap”) would provide the Executive with a greater after-tax amount than if such amounts were not reduced, then the amounts payable to the Executive under this Agreement shall be reduced (but not below zero) to the Safe Harbor Cap. The reduction of the amounts payable hereunder, if applicable, shall be made to the extent necessary in the following order: (i) the acceleration of vesting of stock options with an exercise price that exceeds the then fair market value of the stock subject to the award; (ii) the payments under Section 6(g)(i)(B); (iii) all other payments under this Section 6(g)(i); and then (iv) the acceleration of vesting of restricted stock and stock options with an exercise price that does not exceed the then fair market value of the stock subject to the award. For purposes of reducing the Payments to the Safe Harbor Cap, only amounts payable under this Agreement (and no other Payments) shall be reduced. If the reduction of the amounts payable hereunder would not result in a greater after-tax result to the Executive, no amounts payable under this Agreement shall be reduced pursuant to this provision. All determinations required to be made under this Section 6(g)(i)(C) shall be made by the public accounting firm that is selected by the Executive within ten (10) business days following notice of termination (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the receipt of notice from the Company or the Executive that there has been a Payment, or such earlier time as is requested by the Company or the Executive. Notwithstanding the foregoing, in the event (i) the Board of Directors of the Company shall determine that the Accounting Firm is precluded from performing such services under applicable auditor independence rules; or (ii) the Accounting Firm is serving as accountant or auditor for the person(s) effecting the Change in Control (where applicable), the Board of Directors of the Company and the Executive shall mutually appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees, costs and expenses (including, but not limited to, the costs of retaining experts) of the Accounting Firm shall be borne by the Company. If payments are reduced to the Safe Harbor Cap or the Accounting Firm determines that no Excise Tax is payable by the Executive without a reduction in payments, the Accounting Firm shall provide a written opinion to the Executive to such effect, that the Executive is not required to report any Excise Tax on the Executive’s federal income tax return, and that the failure to report the Excise Tax, if any, on the Executive’s applicable federal income tax return will not result in the imposition of a negligence or similar penalty. The determination by the Accounting Firm shall be binding upon the Company and the Executive (except as provided below). If it is established pursuant to a final determination of a court or an Internal Revenue Service (the “IRS”) proceeding which has been finally and conclusively resolved, that Payments have been made to, or provided for the benefit of, the Executive by the Company, which are in excess of the limitations provided in this Section (referred to hereinafter as an “Excess Payment”), the Executive shall repay the Excess Payment to the Company on demand, together with interest on the Excess Payment at the applicable federal rate (as defined in Section 1274(d) of the Code) from the date of the Executive’s receipt of such Excess Payment until the date of such repayment. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the determination, it is possible that Payments which will not have been made by the Company should have been made (an “Underpayment”), consistent with the calculations required to be made under this Section. In the event that it is determined (i) by the Accounting Firm, the Company (which shall include the position taken by the Company, or together with its consolidated group, on its federal income tax return) or the IRS or (ii) pursuant to a determination by a court, that an Underpayment has occurred, the Company shall pay an amount equal to such Underpayment to the Executive within ten (10) days of such determination together with interest on such amount at the applicable federal rate from the date such amount would have been paid to the Executive until the date of payment. The Executive shall cooperate, to the extent the Executive’s expenses are reimbursed by the Company, with any reasonable requests by the Company in connection with any contests or disputes with the IRS in connection with the Excise Tax or the determination of the Excess Payment. Notwithstanding anything to the contrary in the foregoing provisions of this Section 6(g)(i)(C), (i) payment of the portion of any applicable revocation period specified in such release without revocation Underpayment that is taxes shall not be made later than December 31 of the release year next following the year in which the Excise Tax is remitted to the taxing authority; (ii) payment of the portion of any Underpayment that is interest or penalties incurred by Executivethe Executive with respect to such taxes shall not be made later than December 31 of the year next following the year in which the Executive incurs such interest or penalties, as applicable; and (iii) reimbursement of expenses incurred due to a tax audit or litigation addressing the existence or amount of a tax liability, whether federal, state, local or foreign, shall not be made later than the end of the year following the year in which the taxes that are the subject of the audit or litigation are remitted to the taxing authority, or where as a result of such audit or litigation no taxes are remitted, the end of the year following the year in which the audit is completed or there is a final nonapplicable settlement or other resolution of the litigation. Corporation’s obligation If the Underpayment is a deferral of compensation, the amount of interest and penalties eligible for payment or reimbursement in any year shall not affect the amount of such interest and penalties eligible for payment or reimbursement in any other year, nor shall such right to provide medical and dental insurance benefits payment or reimbursement be subject to Executive will terminate if Executive breaches a provision of Section 3liquidation or exchange for another benefit.
Appears in 1 contract
Termination Without Cause or by Executive for Good Reason. In the event that prior to during the expiration of Employment Term the Term, Corporation terminates Executive’s employment with Corporation is terminated by the Company without Cause under Section 5.5 or the Executive terminates his employment for Good Reason under Section 5.4Reason, Executive will be entitled the Company shall pay to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump the sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for following amounts:
(A) all amounts fully earned pursuant to the fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved on or before terms of this Agreement, but unpaid hereunder through the date of termination, as determined by if any, in respect of Salary, any accrued but not yet paid Annual Performance Bonus owed for the Compensation Committee as provided in Section 2.2. Corporation also will continue year prior to provide Executive’s termination, vesting of any previously issued stock options or will arrange to provide (at Corporation’s cost) Executive with medical restricted stock, payment of life, health and dental disability insurance benefits substantially similar to those to which Executive was entitled as of the date of termination coverage for a period of 12 months five (5) years following the date of termination, and unreimbursed expenses; provided, however, that if Executive is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporationthe Company’s obligation to pay life, health and/or disability insurance shall terminate prior to such fifth year anniversary if Executive accepts other employment that would reasonably be expected to provide such medical insurance;
(B) a severance payment equal to three (3) times the Executive’s combined Salary and dental benefits actual bonus compensation for the preceding fiscal year will terminate automatically. In addition, be paid within five (5) days of the Executive’s last day of employment; and
(C) Anything in this Agreement to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (a) the portion of the Stock Option scheduled to vest in the year of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictionscontrary notwithstanding, in the amount of event it shall be determined that (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010, (ii) 54,000 shares of Common Stock if termination occurs on or after July 1, 2010, and on or prior to June 30, 2011, and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefitsaward, and to accelerate vesting benefit or distribution (or any acceleration of payment, award, benefit or distribution) by the Stock Option and Restricted Stock Award as described above are expressly conditioned on Company (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries affiliates) to or affiliatesfor the benefit of the Executive (whether pursuant to the terms of this Agreement or otherwise) the (“Payments”) would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), and (ii) the expiration reduction of the amounts payable to the Executive under this Agreement to the maximum amount that could be paid to the Executive without giving rise to the Excise Tax (the “Safe Harbor Cap”) would provide the Executive with a greater after-tax amount than if such amounts were not reduced, then the amounts payable to the Executive under this Agreement shall be reduced (but not below zero) to the Safe Harbor Cap. The reduction of the amounts payable hereunder, if applicable, shall be made to the extent necessary in the following order: (i) the acceleration of vesting of stock options with an exercise price that exceeds the then fair market value of the stock subject to the award; (ii) the payments under Section 6(g)(i)(B); (iii) all other payments under this Section 6(g)(i); and then (iv) the acceleration of vesting of restricted stock and stock options with an exercise price that does not exceed the then fair market value of the stock subject to the award. For purposes of reducing the Payments to the Safe Harbor Cap, only amounts payable under this Agreement (and no other Payments) shall be reduced. If the reduction of the amounts payable hereunder would not result in a greater after-tax result to the Executive, no amounts payable under this Agreement shall be reduced pursuant to this provision. All determinations required to be made under this Section 6(g)(i)(C) shall be made by the public accounting firm that is retained by the Company as of the date immediately prior to the Change in Control (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the receipt of notice from the Company or the Executive that there has been a Payment, or such earlier time as is requested by the Company. Notwithstanding the foregoing, in the event (i) the Board of Directors of the Company shall determine prior to the Change in Control that the Accounting Firm is precluded from performing such services under applicable auditor independence rules; (ii) the Audit Committee of the Board of Directors of the Company determines that it does not want the Accounting Firm to perform such services because of auditor independence concerns; or (iii) the Accounting firm is serving as accountant or auditor for the person(s) effecting the Change in Control, the Board of Directors of the Company shall appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees, costs and expenses (including, but not limited to, the costs of retaining experts) of the Accounting Firm shall be borne by the Company. If payments are reduced to the Safe Harbor Cap or the Accounting firm determines that no Excise Tax is payable by the Executive without a reduction in payments, the Accounting Firm shall provide a written opinion to the Executive to such effect, that the Executive is not required to report any Excise Tax on the Executive’s federal income tax return, and that the failure to report the Excise Tax, if any, on the Executive’s applicable federal income tax return will not result in the imposition of a negligence or similar penalty. The determination by the Accounting Firm shall be binding upon the Company and the Executive (except as provided below). If it is established pursuant to a final determination of a court or an Internal Revenue Service (the “IRS”) proceeding which has been finally and conclusively resolved, that Payments have been made to, or provided for the benefit of, the Executive by the Company, which are in excess of the limitations provided in this Section (referred to hereinafter as an “Excess Payment”), the Executive shall repay the Excess Payment to the Company on demand, together with interest on the Excess Payment at the applicable federal rate (as defined in Section 1274(d) of the Code) from the date of the Executive’s receipt of such Excess Payment until the date of such repayment. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the determination, it is possible that Payments which will not have been made by the Company should have been made (an “Underpayment”), consistent with the calculations required to be made under this Section. In the event that it is determined (i) by the Accounting Firm, the Company (which shall include the position taken by the Company, or together with its consolidated group, on its federal income tax return) or the IRS or (ii) pursuant to a determination by a court, that an Underpayment has occurred, the Company shall pay an amount equal to such Underpayment to the Executive within ten (10) days of such determination together with interest on such amount at the applicable federal rate from the date such amount would have been paid to the Executive until the date of payment. The Executive shall cooperate, to the extent the Executive’s expenses are reimbursed by the Company, with any reasonable requests by the Company in connection with any contests or disputes with the IRS in connection with the Excise Tax or the determination of the Excess Payment. Notwithstanding anything to the contrary in the foregoing provisions of this Section 6(g)(i)(C), (i) payment of the portion of any applicable revocation period specified in such release without revocation Underpayment that is taxes shall not be made later than December 31 of the release year next following the year in which the Excise Tax is remitted to the taxing authority; (ii) payment of the portion of any Underpayment that is interest or penalties incurred by Executivethe Executive with respect to such taxes shall not be made later than December 31 of the year next following the year in which the Executive incurs such interest or penalties, as applicable; and (iii) reimbursement of expenses incurred due to a tax audit or litigation addressing the existence or amount of a tax liability, whether federal, state, local or foreign, shall not be made later than the end of the year following the year in which the taxes that are the subject of the audit or litigation are remitted to the taxing authority, or where as a result of such audit or litigation no taxes are remitted, the end of the year following the year in which the audit is completed or there is a final nonapplicable settlement or other resolution of the litigation. Corporation’s obligation If the Underpayment is a deferral of compensation, the amount of interest and penalties eligible for payment or reimbursement in any year shall not affect the amount of such interest and penalties eligible for payment or reimbursement in any other year, nor shall such right to provide medical and dental insurance benefits payment or reimbursement be subject to Executive will terminate if Executive breaches a provision of Section 3liquidation or exchange for another benefit.
Appears in 1 contract
Termination Without Cause or by Executive for Good Reason. In (a) The Company reserves the event that prior right to the expiration of the Term, Corporation terminates terminate Executive’s employment with Corporation at any time. If, however, a Termination Date occurs due to Company terminating Executive without Cause or Executive terminating for Good Reason, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the amounts shown in Section 5.5 4.6(c).
(b) For the avoidance of doubt, Section 4.6(c) shall not apply to (i) termination in the ordinary course on any applicable June 30 if the term of this Agreement is not automatically renewed, which circumstance is covered by Section 4.6(d), (ii) termination for Cause which circumstance is covered by Section 4.5, (iii) termination by Executive without Good Reason which circumstance is covered by Section 4.7, (iv) termination by reason of death which circumstance is covered by Section 4.3, or (v) termination by reason of Disability which circumstance is covered by Section 4.4.
(c) If Company terminates Executive without Cause or Executive terminates his employment with Good Reason, then the Company shall pay to Executive:
(i) the Accrued Base Obligations through the Termination Date, payable promptly after the Termination Date,
(ii) any unpaid Performance Bonus earned for Good Reason under Section 5.4, Executive will be entitled to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for the any fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved ended on or before the date of termination, as determined by the Compensation Committee as provided in Section 2.2. Corporation also will continue to provide or will arrange to provide (at Corporation’s cost) Executive with medical and dental insurance benefits substantially similar to those to which Executive was entitled as of Termination Date payable on the date of termination for a period of 12 months following the date of on which such Performance Bonus would be paid absent termination; provided, however, that if Executive is employed with another employer ,
(iii) Accrued Bonus Obligations,
(iv) amounts equal to Base Compensation through and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporation’s obligation to provide such medical and dental benefits will terminate automatically. In addition, to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, including (aA) the portion 15-month anniversary of the Stock Option scheduled to vest in the year of his termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictions, in the amount of (i) 36,000 shares of Common Stock if his termination occurs on or prior to before June 30, 20102007, (iiB) 54,000 shares the 18-month anniversary of Common Stock his termination if his termination occurs between July 1, 2007 and June 30, 2008, and (C) the 24-month anniversary of his termination if his termination occurs on or after July 1, 20102008, in each case payable at the same times as paid under Section 3.1, and
(v) health and medical benefits as required by Section 3.3 of this Agreement during the same period that amounts equal to Base Compensation are due under Section 4.6(c)(iv); provided, however, if Executive, Executive’s spouse or Executive’s dependents are ineligible to participate in the Company benefit programs under Section 3.3, the Company shall arrange to reimburse Executive for coverage reasonably comparable to that previously provided under Section 3.3, and on further provided that such benefits shall become secondary to primary coverage upon the date or prior to June 30dates Executive receives coverage and benefits which are substantially similar, 2011taken as a whole, and (iii) 72,000 shares if termination occurs on without waiting period or after July 1pre-existing condition limitations, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical plans and dental benefits, and to accelerate vesting of the Stock Option and Restricted Stock Award as described above are expressly conditioned on (i) Executive’s execution, within 30 days following termination of Executive’s employment, programs of a release subsequent employer.
(d) If this Agreement is terminated in the form attached to ordinary course on any applicable June 30 because of a non-renewal notice given by the Company under Section 2.1, then Company shall have no further obligations under this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims except that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries or affiliates, and (ii) the expiration of any applicable revocation period specified in such release without revocation of the release by Executive. Corporation’s obligation to provide medical and dental insurance benefits Company shall pay to Executive will terminate if the same payments as to which the Executive breaches a provision of Section 3.would be entitled under Section
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Termination Without Cause or by Executive for Good Reason. In the event that prior to during the expiration of Employment Term the Term, Corporation terminates Executive’s employment with Corporation is terminated by the Company without Cause under Section 5.5 or the Executive terminates his employment for Good Reason under Section 5.4Reason, Executive will be entitled the Company shall pay to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump the sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for following amounts:
(A) all amounts fully earned pursuant to the fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved on or before terms of this Agreement, but unpaid hereunder through the date of termination, as determined by if any, in respect of Salary, any accrued but not yet paid Annual Performance Bonus owed for the Compensation Committee as provided in Section 2.2. Corporation also will continue year prior to provide Executive’s termination, vesting of any previously issued stock options or will arrange to provide (at Corporation’s cost) Executive with medical restricted stock, payment of life, health and dental disability insurance benefits substantially similar to those to which Executive was entitled as of the date of termination coverage for a period of 12 months five (5) years following the date of termination, and unreimbursed expenses; provided, however, that if Executive is employed with another employer and is eligible to receive medical and dental insurance benefits under another employer-provided plan, Corporationthe Company’s obligation to pay life, health and/or disability insurance shall terminate prior to such fifth year anniversary if Executive accepts other employment that would reasonably be expected to provide such medical insurance;
(B) a severance payment equal to three (3) times the Executive’s combined Salary and dental benefits actual bonus compensation for the preceding fiscal year will terminate automatically. In addition, be paid within five (5) days of the Executive’s last day of employment; and
(C) Anything in this Agreement to the extent not previously vested and as reflected in the Stock Option Award Agreement and the Restricted Stock Unit Award Agreement, (a) the portion of the Stock Option scheduled to vest in the year of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered by the Restricted Stock Award shall vest and shares of Common Stock will be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictionscontrary notwithstanding, in the amount of event it shall be determined that (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010, (ii) 54,000 shares of Common Stock if termination occurs on or after July 1, 2010, and on or prior to June 30, 2011, and (iii) 72,000 shares if termination occurs on or after July 1, 2011, and on or prior to June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefitsaward, and to accelerate vesting benefit or distribution (or any acceleration of payment, award, benefit or distribution) by the Stock Option and Restricted Stock Award as described above are expressly conditioned on Company (i) Executive’s execution, within 30 days following termination of Executive’s employment, of a release (in the form attached to this Agreement as Appendix 6.2, with such modifications specifically in response to changes in applicable law as counsel for Corporation determines to be reasonably necessary or desirable to ensure effective release of all claims) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries affiliates) to or affiliatesfor the benefit of the Executive (whether pursuant to the terms of this Agreement or otherwise) the (“Payments”) would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), and (ii) the expiration reduction of the amounts payable to the Executive under this Agreement to the maximum amount that could be paid to the Executive without giving rise to the Excise Tax (the “Safe Harbor Cap”) would provide the Executive with a greater after-tax amount than if such amounts were not reduced, then the amounts payable to the Executive under this Agreement shall be reduced (but not below zero) to the Safe Harbor Cap. The reduction of the amounts payable hereunder, if applicable, shall be made to the extent necessary in the following order: the acceleration of vesting of stock options or restricted stock with an exercise price that exceeds the then fair market value of the stock subject to the award, the payments under Section 6(g)(i)(B) and all other payments under this Section 6(g)(i). For purposes of reducing the Payments to the Safe Harbor Cap, only amounts payable under this Agreement (and no other Payments) shall be reduced. If the reduction of the amounts payable hereunder would not result in a greater after-tax result to the Executive, no amounts payable under this Agreement shall be reduced pursuant to this provision. All determinations required to be made under this Section 6(g)(i)(C) shall be made by the public accounting firm that is retained by the Company as of the date immediately prior to the Change in Control (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the receipt of notice from the Company or the Executive that there has been a Payment, or such earlier time as is requested by the Company. Notwithstanding the foregoing, in the event (i) the Board of Directors of the Company shall determine prior to the Change in Control that the Accounting Firm is precluded from performing such services under applicable auditor independence rules; (ii) the Audit Committee of the Board of Directors of the Company determines that it does not want the Accounting Firm to perform such services because of auditor independence concerns; or (iii) the Accounting firm is serving as accountant or auditor for the person(s) effecting the Change in Control, the Board of Directors of the Company shall appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees, costs and expenses (including, but not limited to, the costs of retaining experts) of the Accounting Firm shall be borne by the Company. If payments are reduced to the Safe Harbor Cap or the Accounting firm determines that no Excise Tax is payable by the Executive without a reduction in payments, the Accounting Firm shall provide a written opinion to the Executive to such effect, that the Executive is not required to report any Excise Tax on the Executive’s federal income tax return, and that the failure to report the Excise Tax, if any, on the Executive’s applicable federal income tax return will not result in the imposition of a negligence or similar penalty. The determination by the Accounting Firm shall be binding upon the Company and the Executive (except as provided below). If it is established pursuant to a final determination of a court or an Internal Revenue Service (the “IRS”) proceeding which has been finally and conclusively resolved, that Payments have been made to, or provided for the benefit of, the Executive by the Company, which are in excess of the limitations provided in this Section (referred to hereinafter as an “Excess Payment”), the Executive shall repay the Excess Payment to the Company on demand, together with interest on the Excess Payment at the applicable federal rate (as defined in Section 1274(d) of the Code) from the date of the Executive’s receipt of such Excess Payment until the date of such repayment. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the determination, it is possible that Payments which will not have been made by the Company should have been made (an “Underpayment”), consistent with the calculations required to be made under this Section. In the event that it is determined (i) by the Accounting Firm, the Company (which shall include the position taken by the Company, or together with its consolidated group, on its federal income tax return) or the IRS or (ii) pursuant to a determination by a court, that an Underpayment has occurred, the Company shall pay an amount equal to such Underpayment to the Executive within ten (10) days of such determination together with interest on such amount at the applicable federal rate from the date such amount would have been paid to the Executive until the date of payment. The Executive shall cooperate, to the extent the Executive’s expenses are reimbursed by the Company, with any reasonable requests by the Company in connection with any contests or disputes with the IRS in connection with the Excise Tax or the determination of the Excess Payment. Notwithstanding anything to the contrary in the foregoing provisions of this Section 6(g)(i)(C), (i) payment of the portion of any applicable revocation period specified in such release without revocation Underpayment that is taxes shall not be made later than December 31 of the release year next following the year in which the Excise Tax is remitted to the taxing authority; (ii) payment of the portion of any Underpayment that is interest or penalties incurred by Executivethe Executive with respect to such taxes shall not be made later than December 31 of the year next following the year in which the Executive incurs such interest or penalties, as applicable; and (iii) reimbursement of expenses incurred due to a tax audit or litigation addressing the existence or amount of a tax liability, whether federal, state, local or foreign, shall not be made later than the end of the year following the year in which the taxes that are the subject of the audit or litigation are remitted to the taxing authority, or where as a result of such audit or litigation no taxes are remitted, the end of the year following the year in which the audit is completed or there is a final nonapplicable settlement or other resolution of the litigation. Corporation’s obligation If the Underpayment is a deferral of compensation, the amount of interest and penalties eligible for payment or reimbursement in any year shall not affect the amount of such interest and penalties eligible for payment or reimbursement in any other year, nor shall such right to provide medical and dental insurance benefits payment or reimbursement be subject to Executive will terminate if Executive breaches a provision of Section 3liquidation or exchange for another benefit.
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Termination Without Cause or by Executive for Good Reason. In (a) The Company reserves the event that prior right to the expiration of the Term, Corporation terminates terminate Executive’s employment with Corporation at any time. If, however, a Termination Date occurs due to Company terminating Executive without Cause or Executive terminating for Good Reason, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the amounts shown in Section 5.5 4.6(c).
(b) For the avoidance of doubt, Section 4.6(c) shall not apply to (i) termination in the ordinary course on any applicable June 30 if the term of this Agreement is not automatically renewed, which circumstance is covered by Section 4.6(d), (ii) termination for Cause which circumstance is covered by Section 4.5, (iii) termination by Executive without Good Reason which circumstance is covered by Section 4.7, (iv) termination by reason of death which circumstance is covered by Section 4.3, or (v) termination by reason of Disability which circumstance is covered by Section 4.4.
(c) If Company terminates Executive without Cause or Executive terminates his employment with Good Reason, then the Company shall pay to Executive:
(i) the Accrued Base Obligations through the Termination Date, payable promptly after the Termination Date,
(ii) any unpaid Performance Bonus earned for Good Reason under Section 5.4, Executive will be entitled to the amounts described in Section 6.1. Executive will also be entitled to $150,000 in cash in a lump sum to be paid within 30 days following termination. Executive will also be entitled to be paid, in a lump sum payable within 30 days following termination, all or a portion of the cash bonus described in Section 2.2 above for the any fiscal year in which such termination occurs based on the extent to which the applicable performance measures for that fiscal year had been achieved ended on or before the date of termination, as determined by the Compensation Committee as provided in Section 2.2. Corporation also will continue to provide or will arrange to provide (at Corporation’s cost) Executive with medical and dental insurance benefits substantially similar to those to which Executive was entitled as of Termination Date payable on the date of termination for a period of 12 months following on which such Performance Bonus would be paid absent termination,
(iii) Accrued Bonus Obligations,
(iv) amounts equal to Base Compensation through and including the date six months after the Termination Date, and
(v) health and medical benefits as required by Section 3.3 of terminationthis Agreement during the same period that amounts equal to Base Compensation are due under Section 4.6(c)(iv); provided, however, that if Executive is employed with another employer and is eligible Executive, Executive’s spouse or Executive’s dependents are ineligible to receive medical and dental insurance benefits under another employer-provided plan, Corporation’s obligation to provide such medical and dental benefits will terminate automatically. In addition, to the extent not previously vested and as reflected participate in the Stock Option Award Company benefit programs under Section 3.3, the Company shall arrange to reimburse Executive for coverage reasonably comparable to that previously provided under Section 3.3, and further provided that such benefits shall become secondary to primary coverage upon the date or dates Executive receives coverage and benefits which are substantially similar, taken as a whole, without waiting period or pre-existing condition limitations, under the plans and programs of a subsequent employer.
(d) If this Agreement and the Restricted Stock Unit Award Agreement, (a) the portion of the Stock Option scheduled to vest is terminated in the year ordinary course on any applicable June 30 because of termination and in the following year shall vest in full and any additional unvested portions shall be cancelled and (b) restricted stock units covered a non-renewal notice given by the Restricted Stock Award Company under Section 2.1, then Company shall vest and shares of Common Stock will have no further obligations under this Agreement except that Company shall pay to Executive the same payments as to which the Executive would be issued to Executive, subject to Sections 6.4 and 6.5 below, free of any restrictions, in the amount of (i) 36,000 shares of Common Stock if termination occurs on or prior to June 30, 2010entitled under Section 4.6(c)(i), (ii) 54,000 shares of Common Stock if termination occurs on or after July 1), 2010, and on or prior to June 30, 2011(iv), and (iii) 72,000 shares if termination occurs v). If this Agreement is terminated in the ordinary course on or after July 1, 2011, and on or prior to any applicable June 30, 2012, less any shares of Common Stock that had previously vested under the terms of the Restricted Stock Unit Award Agreement. Corporation’s obligations to make the $150,000 lump-sum payment, to provide medical and dental benefits, and to accelerate vesting of the Stock Option and Restricted Stock Award as described above are expressly conditioned on (i) Executive’s execution, within 30 days following termination of Executive’s employment, because of a release (in non-renewal notice given by the form attached to Executive under Section 2.1, then Company shall have no further obligations under this Agreement as Appendix 6.2, with such modifications specifically in response except that Company shall pay to changes in applicable law as counsel for Corporation determines Executive the payments to which the Executive would be reasonably necessary or desirable to ensure effective release of all claimsentitled under Section 4.6(c)(i) of any and all claims that Executive may hold through the date such release is executed against Corporation or any of its subsidiaries or affiliates, and (ii) the expiration of any applicable revocation period specified in such release without revocation of the release by Executive. Corporation’s obligation to provide medical and dental insurance benefits to Executive will terminate if Executive breaches a provision of Section 3).
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