Exhibit 10.2
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”), made as of the
8 th day of April 2009 (the “Effective Date”), is entered into by Ocean Power
Technologies, Inc., a New Jersey corporation with a principal place of business
at 1590 Reed Road, Pennington, New Jersey 08534 (the “Company”), and Charles F.
Dunleavy, an individual with his primary residence at [address deleted] (the
“Employee”).
WHEREAS, the Company and the Employee entered into an Amended and Restated
Employment Agreement on October 23, 2003 (the “Prior Agreement”); and
WHEREAS, the Company and the Employee desire to amend and restate and supersede
the Prior Agreement in its entirety; and
WHEREAS, the Company desires to continue the employment of the Employee, and the
Employee desires to be employed by the Company pursuant to the terms of this
Agreement.
NOW THEREFORE, in consideration of the promises and mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
1. Term of Employment. The Company hereby agrees to employ the Employee, and the
Employee hereby agrees to accept employment with the Company pursuant to the
terms and conditions of this Agreement, for the period commencing on the
Effective Date and expiring on the day before the first anniversary thereof,
unless sooner terminated (the “Initial Term”). On the expiration of the Initial
Term and on each anniversary thereof, the Agreement shall renew automatically
for additional one-year periods (the “Renewal Term”), unless sooner terminated
or unless either party notifies the other party in writing of his or its

 

 

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intentions not to renew this Agreement not less than sixty (60) days prior to
the expiration of the then current term (“Notice of Nonrenewal”). A Notice of
Nonrenewal by the Company of its intent not to renew this Agreement shall
constitute “Good Reason” for termination of this Agreement by the Employee,
pursuant to Section 4(d) hereof. Upon a termination by either party for any
reason and at any time, the payments or other benefits stated in Section 5
hereof shall be the exclusive remedy available to the Employee under this
Agreement.
2. Position and Duties. The Employee shall serve as Senior Vice President and
Chief Financial Officer of the Company. The Employee shall be subject to the
supervision of, and shall have such authority and duties to the Company or its
subsidiaries or affiliates, as are reasonably delegated to him, by the Board of
Directors of the Company (the “Board”) and such duties and responsibilities
common to Senior Vice Presidents and Chief Financial Officers of companies of
like size and purpose. The Employee shall devote his full working time, energy
and skill (reasonable absences for vacations and illness excepted) to the
business of the Company during the term of this Agreement as is necessary to
perform the Employee’s duties faithfully, competently and diligently. The
Employee agrees to abide by the rules, regulations, instructions, personnel
practices and policies of the Company and any Company affiliate or subsidiary
for or with which the Employee conducts any business, as they may be changed,
amended or adopted from time to time. Upon approval by the Board, which approval
shall not be unreasonably withheld, the Employee may devote reasonable periods
of time to serving on the boards of directors of other companies or
organizations, so long as such service does not unreasonably interfere with his
duties to the Company and does not constitute a conflict of the Company’s
interests.

 

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3. Compensation. During the term of this Agreement, the Employee shall receive,
for all services rendered to the Company hereunder, the following salary,
compensation and benefits (hereinafter referred to as “Compensation”):
(a) Base Salary. Commencing on the Effective Date, the Employee shall be paid a
base salary at the annualized rate of Three Hundred Thousand Dollars ($300,000).
Base salary will be payable in accordance with the Company’s normal payroll
procedures. The Employee’s base salary shall be reviewed on an annual basis, and
positive adjustments may be made by the Compensation Committee of the Board (the
“Compensation Committee”) in its sole discretion. The base salary shall not be
subject to decrease without the written consent of the Employee.
(b) Bonuses. The Employee may be eligible for bonuses pursuant to any bonus
program designed for employees of the Company. Such bonuses, if any, shall be at
the sole discretion of the Compensation Committee.
(c) Incentive Compensation. The Employee may be eligible for incentive
compensation, including stock options and restricted stock grants, pursuant to
any incentive compensation program designed for employees of the Company. Such
incentive compensation, if any, shall be determined by the Compensation
Committee in the exercise of its sole discretion.
(d) Benefits. The Employee shall be eligible to participate in all benefits
programs, if any, that the Company establishes and makes available to its
employees and executives, in accordance with and subject to the terms and
conditions of such benefits programs. Such programs may include health and
dental insurance plans, long-term disability insurance plans, life insurance
plans, and other benefits made available to the Company’s employees from time to
time.

 

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(e) Reimbursement of Expenses. The Company shall reimburse the Employee for all
reasonable and necessary business-related expenses incurred or paid by the
Employee in the performance of the Employee’s duties, responsibilities or
services under this Agreement, provided that the Employee provides
documentation, receipts, vouchers, and/or such other supporting information as
the Company may request.
(f) Deductions. The Company shall deduct and withhold from the Employee’s
compensation all necessary or required taxes, including, but not limited to,
social security, withholding and otherwise, and any other applicable amounts
required by law or any taxing authority, as well as such other deductions
properly authorized in writing by the Employee.
(g) Absences. The Employee shall be entitled to a minimum of 20 days of paid
vacation time per calendar year, as well as sick leave, and such other absences
in accordance with and subject to the Company’s current policies and procedures
regarding such paid absences. Such policies may be amended, modified, or
rescinded in the Company’s sole discretion.
4. Termination. The employment of the Employee by the Company shall terminate
upon the occurrence of any of the following:
(a) The Company may terminate the Employee’s employment hereunder for Cause
immediately and with prompt notice to the Employee, which Cause shall be
determined in good faith by the Board. The Employee shall be provided a
reasonable opportunity to be heard by the Board, before his employment is
terminated for Cause hereunder. “Cause” for termination shall include the
following conduct of the Employee:
(i) Material breach of any provision of this Agreement by the Employee causing a
material detrimental effect on the Company;

 

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(ii) Material misconduct as an employee which has a material detrimental effect
on the Company, including: misappropriating any funds or property of the
Company, or attempting to willfully obtain any substantial personal profit from
any transaction in which the Employee has an interest which is adverse to the
interests of the Company;
(iii) Gross negligence or knowing refusal to perform the reasonable duties
assigned to the Employee under or pursuant to this Agreement;
(iv) Conviction of a felony or plea of no lo contendre to a felony;
(v) Acts of dishonesty or moral turpitude by the Employee that are materially
detrimental to the Company; or
(vi) Alcohol or drug use which impairs the Employee’s ability to perform his
duties hereunder.

 

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(b) Immediately upon the death of the Employee;
(c) Thirty days after the Disability of the Employee. As used in this Agreement,
the term “Disability” shall mean the inability of the Employee with reasonable
accommodation as may be required by State or Federal law, due to a physical or
mental disability, for a period of ninety (90) days, whether or not consecutive,
during any 360-day period to perform the services contemplated under this
Agreement. A determination of Disability shall be made by a physician
satisfactory to both the Employee and the Company, provided that if the Employee
and the Company do not agree on a physician, the Employee and the Company shall
each select a physician and these two together shall select a third physician,
whose determination as to Disability shall be binding on all parties;
(d) The Employee may terminate his employment hereunder for “Good Reason” if,
after written notice as provided below, the Company fails to cure the following
conduct:
(i) Material breach of any provision of this Agreement by the Company;
(ii) Failure to maintain the Employee in a position commensurate with that
referred to in Section 2 of this Agreement; or
(iii) The assignment to the Employee of any duties inconsistent with the
Employee’s position, authority, duties or responsibilities as contemplated by
Section 2 of this Agreement that results in a substantial diminution in the
Employee’s duties or responsibilities;
(iv) Relocation of the Employee’s main office more than 50 miles from
Pennington, New Jersey;
(v) Material reduction in the Employee’s base salary or a material adverse
change in the Employee’s eligibility for incentive compensation; or
(vi) The termination of the Employee’s employment without Cause by the giving by
the Company of a Notice of Nonrenewal, informing the employee of the Company’s
intent not to renew the Initial Term or any Renewal Term.

 

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Notwithstanding the occurrence of any such event or circumstance, such
occurrence shall not be deemed to constitute Good Reason unless (x) the Employee
gives the Company written notice of termination no more than 90 days after the
initial existence of such event or circumstance, (y) such event or circumstance
has not been fully corrected within 30 days of the Company’s receipt of such
notice and (z) the Employee’s termination of employment occurs within one year
following the Company’s receipt of such notice.
(e) At the election of the Employee, without Good Reason, upon not less than
thirty (30) days prior written notice of termination to the Company;
(f) At the election of the Company, without Cause, immediately upon thirty
(30) days prior written notice of termination to the Employee.
5. Effect of Termination. Upon termination of this Agreement at any time, the
payments and remedies stated in this Section 5 shall be exclusive and Employee
shall not be eligible for any further payment or other benefits from the
Company.
(a) Termination for Cause or at Election of the Employee without Good Reason. In
the event the Employee’s employment is terminated for Cause pursuant to
Section 4(a), or at the election of the Employee pursuant to Section 4(e), the
Company shall pay to the Employee the base salary and benefits due and owing to
him under Section 3 through the last day of the Employee’s actual employment by
the Company.

 

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(b) Termination for Death or Disability. If the Employee’s employment is
terminated by death or because of disability pursuant to Section 4(b) or 4(c),
the Company shall pay to the estate of the Employee or to the Employee, as the
case may be, the base salary and benefits that would otherwise be payable to the
Employee through the end of the month in which the termination of employment
because of death or disability occurs. In addition, the Company will make a
one-time payment of $10,000.00 to the estate of the Employee or to the Employee,
as the case may be. If the payment is made due to disability, the Employee will
be required to sign a release of claims as in Section 5(c) prior to receiving
the payment under this section.
(c) Termination by the Company Without Cause; Termination by the Employee for
Good Reason. If the Employee’s employment is terminated without Cause pursuant
to Section 4(f) or if the Employee terminates his own employment for Good Reason
pursuant to Section 4(d), and if, and only if, the Employee first executes a
general release drafted by and satisfactory to counsel for the Company releasing
the Company, along with its directors, officers, employees, agents and affiliate
company’s from any and all liability to the Employee (the “Release Agreement”),
the Company shall pay and provide to the Employee, or to his estate if he were
to die after termination and prior to such payment: (i) the Employee’s then
current base salary, as severance pay, for a period equal to the Severance
Period, as defined below, to be paid in a lump sum payment within thirty
(30) days of termination, and (ii) continuation of the Employee’s health,
medical and long term disability insurance during the Severance Period, as
defined below, at the Company’s expense, until such time as the Employee becomes
eligible for such coverage through a subsequent employer and only to the extent
permitted pursuant to the Company’s applicable benefit insurance policies (or,
if not so permitted, the Company shall reimburse the Employee for similar
coverage under COBRA). The payments pursuant to Section 5(c)(i) shall be paid
regardless of whether the Employee seeks or obtains any employment subsequent to
his employment with the Company. The payments under Section 5(c)(i) shall
commence 30 days following the Employee’s date of termination, provided that the
Employee has executed the Release Agreement and any waiting periods contained in
such release

 

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have expired prior to such 30th day following the date of termination.
Notwithstanding the foregoing, if the 30th day following the date of termination
occurs in the calendar year following the year of Employee’s termination of
employment, then the payments shall commence no earlier than January 1 of such
subsequent calendar year. In addition, regardless of whether the Employee signs
the Release Agreement, the Company shall pay to the Employee the salary and
benefits due and owing to him under Section 3 through the last day of the
Employee’s actual employment by the Company. The term “Severance Period” as used
herein shall mean a period of twelve (12) months. The payments under clause
(i) of this Section 5(c) shall be subject to the terms and conditions set forth
on Exhibit A hereto.
(d) Survival. The provisions of Sections 6, 7 and 8 of this Agreement shall
survive the termination of this Agreement.
6. Restrictive Covenants.
(a) During the term of this Agreement and for a period of one (1) year after the
termination or expiration thereof, the Employee will not directly or indirectly:
(i) as an individual proprietor, partner, stockholder, officer, employee,
director, joint venturer, investor, lender, or in any other capacity whatsoever
(other than as the holder of not more than one percent (1%) of the total
outstanding stock of a publicly held company), engage in the business of
developing, producing, marketing or selling services of the kind or type
developed or being developed, produced, marketed or sold by the Company while
the Employee was employed by the Company; or

 

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(ii) hire, engage, recruit, solicit or induce, or attempt to induce, any current
or prospective employee, officer, director, contractor or other business
associate of the Company to terminate their employment with, or otherwise cease
their business relationship with, the Company; or
(iii) solicit, divert or take away, or attempt to divert or to take away, the
business or patronage of any of the clients, customers or accounts, or
prospective clients, customers or accounts, of the Company which were contacted,
solicited or served by the Employee while employed by the Company.
(iv) For the purposes of these restrictions, the word “prospective” shall apply
to any individual or entity with which the Company has had substantive contact
within the twelve month period prior to any potential hiring, solicitation,
recruiting, diversion or otherwise. In addition a “current” employee shall
include any employee who was employed by the Company within the three (3) months
preceding any potential solicitation or hiring.

 

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(b) If any restriction set forth in this Section 6 is found by any court of
competent jurisdiction to be unenforceable because it extends for too long a
period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum period
of time, range of activities or geographic area as to which it may be
enforceable.
(c) The restrictions contained in Sections 6, 7 and 8 are necessary for the
protection of the business and goodwill of the Company and are considered by the
Employee to be reasonable for such purpose. The Employee agrees that any breach
of Sections 6, 7 or 8 will cause the Company substantial and irrevocable damage
and therefore, in the event of any such breach, in addition to such other
remedies which may be available, the Company shall have the right to seek
specific performance and injunctive relief in any court of competent
jurisdiction, regardless of any statement to the contrary herein.
7. Proprietary Information.
(a) The Employee agrees that all information and know-how, whether or not in
writing, of a private, secret or confidential nature concerning the Company’s
business or financial affairs (collectively, “Proprietary Information”) is and
shall be the exclusive property of the Company. By way of illustration, but not
limitation, Proprietary Information may include inventions, products, processes,
methods, techniques, formulas, compositions, compounds, projects, developments,
plans, research data, clinical data, financial data, personnel data, computer
programs, and customer and supplier lists. The Employee will not disclose any
Proprietary Information to others outside the Company or use the same for any
unauthorized purposes without written approval by an officer of the Company,
either during or after his employment, unless and until such Proprietary
Information has become public knowledge without fault by the Employee.

 

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(b) The Employee agrees that all files, letters, memoranda, reports, records,
data, sketches, drawings, laboratory notebooks, program listings, or other
written, photographic, or other tangible material containing Proprietary
Information, whether created by the Employee or others, which shall come into
his custody or possession, shall be and are the exclusive property of the
Company to be used by the Employee only in the performance of his duties for the
Company.
(c) The Employee agrees that his obligation not to disclose or use information,
know-how and records of the types set forth in paragraphs (a) and (b) above,
also extends to such types of information, know-how, records and tangible
property of customers of the Company or suppliers to the Company or other third
parties who may have disclosed or entrusted the same to the Company or to the
Employee in the course of the Company’s business.
(d) The Employee agrees that, immediately upon the termination of his employment
with the Company for any reason, he shall return all Proprietary Information and
other property of the Company that is in his possession or control.
8. Developments.
(a) The Employee will make full and prompt disclosure to the Company of all
inventions, improvements, discoveries, methods, developments, software, and
works of authorship, whether patentable or not, which are created, made,
conceived or reduced to practice by the Employee or under his direction or
jointly with others during his employment by the Company, whether or not during
normal working hours or on the premises of the Company (all of which are
collectively referred to as “Developments”).

 

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(b) The Employee agrees to assign and does hereby assign to the Company (or any
person or entity designated by the Company) all his right, title and interest in
and to all Developments and all related patents, patent applications,
copyrights, copyright applications, design rights (registered or unregistered)
and all rights of a similar or equivalent nature in any jurisdiction. However,
this Section 8(b) shall not apply to Developments which do not relate to the
present or planned business or research and development of the Company and which
are made and conceived by the Employee not during normal working hours, not on
the Company’s premises and not using the Company’s tools, devices, equipment or
Proprietary Information.
(c) The Employee agrees to cooperate fully with the Company, both during and
after his employment with the Company, with respect to the procurement,
maintenance and enforcement of copyrights and patents (both in the United States
and foreign countries) relating to Developments. The Employee shall sign all
papers, including, without limitation, copyright applications, patent
applications, declarations, oaths, formal assignments, assignment of priority
rights, and powers of attorney, which the Company may deem necessary or
desirable in order to protect its rights and interests in any Development. The
Employee unconditionally and irrevocably waives all moral rights he may have in
relation to the Developments.
9. Other Agreements. The Employee hereby represents that he is not bound by the
terms of any agreement with any previous employer or other party to refrain from
using or disclosing any trade secret or confidential or proprietary information
in the course of his employment with the Company or to refrain from competing,
directly or indirectly, with the business of such previous employer or any other
party. The Employee further represents that his performance of all the terms of
this Agreement and as an employee of the Company does not and will not breach
any agreement to keep in confidence proprietary information, knowledge or data
acquired by him in confidence or in trust prior to his employment with the
Company or otherwise violate any agreement or other obligation that the Employee
may have to any other party.

 

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10. Indemnification Agreement and Invention Assignment Confidentiality
Agreement. Nothing in this Agreement is intended to supercede: (i) the
Indemnification Agreement signed by the Employee on March 24, 1995; or (ii) any
stock option agreement between the Employee and the Company. The parties intend
to provide the Employee with the greatest level of protection under each of the
agreements. To the extent that the Employee is eligible for severance pay or
other post termination benefits pursuant to more than one agreement, the
provisions of this agreement shall supercede all other agreements (post
termination treatment of equity positions shall not be considered “severance”
for the purpose of this Section). Nothing herein is intended to supercede any
tights the Company may have pursuant to any invention assignment,
confidentiality, non-competition or non-solicitation agreement between the
Employee and the Company and it is intended that the Company shall receive the
greatest protection provided pursuant to any such agreement, this agreement or
common law.
11. Resolution of Disputes. Any disputes arising under or in connection with
this Agreement or otherwise arising pursuant to the Employee’s employment with
the Company shall be resolved by binding arbitration to be held in the State of
New Jersey, in accordance with the applicable arbitration rules of the American
Arbitration Association before a panel of three arbitrators. Judgment upon the
award rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. Each party shall bear his or its own costs of the
arbitration or, if applicable, litigation; however, the prevailing party shall
be reimbursed for his or its costs and expenses, including attorneys’ fees to
the extent the dispute involves rights arising under a statute providing costs
and fees to a prevailing party or to the extent such prevailing party has proven
a material breach of this Agreement by the other party. Nothing in this Section
shall in any way limit the Company’s right to seek injunctive or other equitable
relief in any court of competent jurisdiction, to enforce the provisions of
Sections 6, 7 and 8 hereof. Each party agrees to waive his or its right to a
trial by jury on any claims arising out of their relationship and agree that the
arbitrators shall be empowered to award damages to the same extent a court of
competent jurisdiction would have had.

 

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12. Notices. All notices required or permitted under this Agreement shall be in
writing and shall be deemed effective upon personal delivery or upon deposit in
the United States Post Office, by registered or certified mail, postage prepaid,
addressed to the other party at the address shown above, or at such other
address or addresses as either party shall designate to the other in accordance
with this Section 12.
13. Entire Agreement. This Agreement constitutes the entire agreement between
the parties and supersedes all prior agreements and understandings, whether
written or oral, relating to the subject matter of this Agreement, including but
not limited to the Original Agreement and the Change in Control Severance Pay
Agreement signed by the Employee on or about January 12, 2000, except as stated
to the contrary in Section 10.
14. Amendment. This Agreement may be amended or modified only by a writing
executed by both the Employee and a representative of the Company acting on
express authority from the Board.
15. Governing Law. This Agreement shall be construed, interpreted and enforced
in accordance with the laws of the State of New Jersey.
16. Successors and Assigns; Binding Agreement.
(a) This Agreement shall be binding upon and inure to the benefit of both
parties and their respective successors and assigns, including any corporation
with which or into which the Company may be merged or which may succeed to its
assets or business, provided however, that the obligations of the Employee are
personal and shall not be assigned by him. The Company specifically reserves the
right to assign its rights under this Agreement, including but limited to, any
covenants by the Employee contained in Sections 6, 7 and 8 hereof.

 

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(b) The Employer will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business or assets of the Employer, to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the Employer would
be required to perform it if no such succession had taken place, unless such
assumption occurs automatically by operation of law.
17. Acknowledgement. The Employee states and represents that he has had an
opportunity to fully discuss and review the terms of this Agreement with an
attorney. The Employee further states and represents that he has carefully read
this Agreement, understands the contents herein, freely and voluntarily assents
to all of the terms and conditions hereof, and signs his name as his own free
act.
18. No Waiver. No delay or omission by the Company in exercising any right under
this Agreement shall operate as a waiver of that or any other right. A waiver or
consent given by the Company on any one occasion shall be effective only in that
instance and shall not be construed as a bar or waiver of any right on any other
occasion.
19. Captions. The captions of the Sections of this Agreement are for convenience
of reference only and in no way define, limit or affect the scope or substance
of any Section of this Agreement.
20. Severability. In case any provision of this Agreement shall be invalid,
illegal or otherwise unenforceable, the validity, legality and enforceability of
the remaining provisions shall in no way be affected or impaired thereby.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year set forth above.

                          OCEAN POWER TECHNOLOGIES, INC.    
 
               
/s/ CHARLES F. DUNLEAVY
 
Charles F. Dunleavy
      By:   /s/ GEORGE W. TAYLOR
 
Name: George W. Taylor
Title: Executive Chairman    

 

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Exhibit A
Compliance with Section 409A
Subject to the provisions in this Exhibit A, any severance payments or benefits
under this Agreement shall begin only upon the date of Employee’s “separation
from service” (determined as set forth below) which occurs on or after the date
of termination of Employee’s employment. The following rules shall apply with
respect to distribution of the payments and benefits, if any, to be provided to
Employee under this Agreement:
(a) It is intended that each installment of the severance payments and benefits
provided under this Agreement shall be treated as a separate “payment” for
purposes of Section 409A of the Code and the guidance issued thereunder
(“Section 409A”). Neither the Company nor Employee shall have the right to
accelerate or defer the delivery of any such payments or benefits except to the
extent specifically permitted or required by Section 409A.
(b) If, as of the date of Employee’s “separation from service” from the Company,
Employee is not a “specified employee” (within the meaning of Section 409A),
then each installment of the severance payments and benefits shall be made on
the dates and terms set forth in this Agreement.
(c) If, as of the date of Employee’s “separation from service” from the Company,
Employee is a “specified employee” (within the meaning of Section 409A), then:
(i) Each installment of the severance payments and benefits due under this
Agreement that, in accordance with the dates and terms set forth herein, will in
all circumstances, regardless of when the separation from service occurs, be
paid within the short-term deferral period (as defined in Section 409A) shall be
treated as a short-term deferral within the meaning of Treasury
Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under
Section 409A; and
(ii) Each installment of the severance payments and benefits due under this
Agreement that is not described in this Exhibit A, paragraph (c)(i) above and
that would, absent this subparagraph, be paid within the six-month period
following Employee’s “separation from service” from the Company shall not be
paid until the date that is six months and one day after such separation from
service (or, if earlier, Employee’s death), with any such installments that are
required to be delayed being accumulated during the six-month period and paid in
a lump sum on the date that is six months and one day following Employee’s
separation from service and any subsequent installments, if any, being paid in
accordance with the dates and terms set forth herein; provided, however, that
the preceding provisions of this sentence shall not apply to any installment of
severance payments and benefits if and to the maximum extent that such
installment is deemed to be paid under a separation pay plan that does not
provide for a deferral of compensation by reason of the application of Treasury
Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary
separation from service). Any installments that qualify for the exception under
Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the
last day of Employee’s second taxable year following the taxable year in which
the separation from service occurs.

 

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(d) The determination of whether and when Employee’s separation from service
from the Company has occurred shall be made in a manner consistent with, and
based on the presumptions set forth in, Treasury Regulation Section 1.409A-1(h).
Solely for purposes of this Exhibit A, paragraph (d), “Company” shall include
all persons with whom the Company would be considered a single employer as
determined under Treasury Regulation Section 1.409A-1(h)(3).
(e) All reimbursements and in-kind benefits provided under this Agreement shall
be made or provided in accordance with the requirements of Section 409A to the
extent that such reimbursements or in-kind benefits are subject to Section 409A,
including, where applicable, the requirements that (i) any reimbursement is for
expenses incurred during Employee’s lifetime (or during a shorter period of time
specified in this Agreement), (ii) the amount of expenses eligible for
reimbursement during a calendar year may not affect the expenses eligible for
reimbursement in any other calendar year, (iii) the reimbursement of an eligible
expense will be made on or before the last day of the calendar year following
the year in which the expense is incurred and (iv) the right to reimbursement is
not subject to set off or liquidation or exchange for any other benefit.
(f) Notwithstanding anything herein to the contrary, the Company shall have no
liability to Employee or to any other person if the payments and benefits
provided hereunder that are intended to be exempt from or compliant with
Section 409A are not so exempt or compliant.

 

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