***Confidential***Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under theExchange Act) of 20% or more of either (A) the then-outstanding shares of common stock of theCompany (the “Outstanding Company Common Stock”) or (B) the combined voting power of thethen-outstanding voting securities of the Company entitled to vote generally in the election ofdirectors (the “Outstanding Company Voting Securities”); *provided, however,*that, for purposes ofthis Section 1(d), the following acquisitions shall not constitute a Change of Control: (i) anyacquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisitionby any employee benefit plan (or related trust) sponsored or maintained by the Company or anyAffiliated Company or (iv) any acquisition by any corporation pursuant to a transaction thatcomplies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C).          (2) Individuals who, as of the date hereof, constitute the Board (the“Incumbent Board”) cease for any reason to constitute at least a majority of the Board;*provided,however,*that any individual becoming a director subsequent to the date hereof whose election,or nomination for election by the Company’s shareholders, was approved by a vote of at least amajority of the directors then comprising the Incumbent Board shall be considered as thoughsuch individual were a member of the Incumbent Board, but excluding, for this purpose, anysuch individual whose initial assumption of office occurs as a result of an actual orthreatenedelection contest with respect to the election or removal of directors or other actual orthreatenedsolicitation of proxies or consents by or on behalf of a Person other than the Board.          (3) Consummation of a reorganization, merger, statutory share exchange orconsolidation or similar corporate transaction involving the Company, a sale or otherdispositionof all or substantially all of the assets of the Company, or the acquisition of assets orstock ofanother entity by the Company or any of its subsidiaries (each, a “Business Combination”), ineach case unless, following such Business Combination, (A) all or substantially all of theindividuals and entities that were the beneficial owners of the Outstanding Company CommonStock and the Outstanding Company Voting Securities immediately prior to such BusinessCombination beneficially own, directly or indirectly, more than 60% of the then-outstandingshares of common stock and the combined voting power of the then-outstanding voting securitiesentitled to vote generally in the election of directors, as the case may be, of thecorporationresulting from such Business Combination (including, without limitation, a corporation that,as aresult of such transaction, owns the Company or all or substantially all of the Company’sassetseither directly or through one or more subsidiaries) in substantially the same proportions astheirownership immediately prior to such Business Combination of the Outstanding CompanyCommon Stock and the Outstanding Company Voting Securities, as the case may be, (B) noPerson (excluding any employee benefit plan (or related trust) of the Company or suchcorporation resulting from such Business Combination) beneficially owns, directly orindirectly,20% or more of, respectively, the then-outstanding shares of common stock of the corporationresulting from such Business Combination or the combined voting power of the then-outstandingvoting securities of such corporation, except to the extent that such ownership existed priorto theBusiness Combination, and (C) at least a majority of the members of the board of directors ofthecorporation resulting from such Business Combination were members of the Incumbent Board atthe time of the execution of the initial agreement or of the action of the Board providing forsuchBusiness Combination; or
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***Confidential***          (4) Approval by the shareholders of the Company of a complete liquidation or dissolution ofthe Company.          **Section 2.****Employment Period.** The Company hereby agrees to continue the Executive inits employ or in the employ of a subsidiary of the Company, as the case may be, subject to theterms and conditions of this Agreement, for the period commencing on the Effective Date and endingon the second anniversary of the Effective Date (the “Employment Period”). The Employment Periodshall terminate upon the Executive’s termination of employment for any reason.          **Section 3.****Terms of Employment****.**          (a)**Position and Duties**. (1) During the Employment Period, (A) theExecutive’s position (including status, offices, titles and reporting requirements),authority, duties and responsibilities shall be at least commensurate in all material respects with themost significant of those held, exercised and assigned at any time during the 120-day periodimmediately preceding the Effective Date and (B) the Executive’s services shall be performedat the office where the Executive was employed immediately preceding the Effective Date or at anyother location less than 30 miles from such office.          (2) During the Employment Period, and excluding any periods of vacation and sick leave towhich the Executive is entitled, the Executive agrees to devote reasonable attention and timeduring normal business hours to the business and affairs of the Company and, to the extentnecessary to discharge the responsibilities assigned to the Executive hereunder, to use theExecutive’s reasonable best efforts to perform faithfully and efficiently such responsibilities.During the Employment Period, it shall not be a violation of this Agreement for the Executive to(A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfillspeaking engagements or teach at educational institutions and (C) manage personal investments, solong as such activities do not significantly interfere with the performance of the Executive’sresponsibilities as an employee of the Company in accordance with this Agreement. It is expresslyunderstood and agreed that, to the extent that any such activities have been conducted by theExecutive prior to the Effective Date, the continued conduct of such activities (or the conduct ofactivities similar in nature and scope thereto) subsequent to the Effective Date shall notthereafter be deemed to interfere with the performance of the Executive’s responsibilities to theCompany.          (b)**Compensation**. (1) **Base Salary****.**During the Employment Period, theExecutive shall receive an annual base salary (the “Annual Base Salary”) at an annual rate atleast equal to 12 times the highest monthly base salary paid or payable, including any basesalary that has been earned but deferred, to the Executive by the Company and the AffiliatedCompanies in respect of the 12-month period immediately preceding the month in which theEffective Date occurs. The Annual Base Salary shall be paid at such intervals as the Companypays executive salaries generally. During the Employment Period, the Annual Base Salary shallbe reviewed at least annually, beginning no more than 12 months after the last salary increaseawarded to the Executive prior to the Effective Date. Any increase in the Annual Base Salaryshall not serve to limit or reduce any other obligation to the Executive under this Agreement.
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***Confidential***The Annual Base Salary shall not be reduced after any such increase and the term “Annual BaseSalary” shall refer to the Annual Base Salary as so increased.          (2) **Annual Bonus****.**In addition to the Annual Base Salary, the Executive shallparticipate in a bonus program during the Employment Period and have a bonus opportunitywhich is no less favorable than the bonus opportunity for other employees of his level at theCompany and its Affiliated Companies.          (3) **Incentive, Savings and Retirement Plans****.**During the EmploymentPeriod, the Executive shall be entitled to participate in all cash incentive, equityincentive, savings and retirement plans, practices, policies, and programs applicable generally to otherpeer executives of the Company and the Affiliated Companies, but in no event shall such plans,practices, policies and programs provide the Executive with incentive opportunities (measuredwith respect to both regular and special incentive opportunities, to the extent, if any, thatsuch distinction is applicable), savings opportunities and retirement benefit opportunities, ineach case, less favorable, in the aggregate, than the most favorable of those provided by theCompany and the Affiliated Companies for the Executive under such plans, practices, policies andprograms as in effect at any time during the 120-day period immediately preceding theEffective Date or, if more favorable to the Executive, those provided generally at any time after theEffective Date to other peer executives of the Company and the Affiliated Companies.          (4) **Welfare Benefit Plans****.**During the Employment Period, the Executiveand/or the Executive’s family, as the case may be, shall be eligible for participation in andshall receive all benefits under welfare benefit plans, practices, policies and programs provided bythe Company and the Affiliated Companies (including, without limitation, medical, prescription,dental, disability, employee life, group life, accidental death and travel accident insuranceplans and programs) to the extent applicable generally to other peer executives of the Company andthe Affiliated Companies, but in no event shall such plans, practices, policies and programsprovide the Executive with benefits that are less favorable, in the aggregate, than the most favorableof such plans, practices, policies and programs in effect for the Executive at any time duringthe 120-day period immediately preceding the Effective Date or, if more favorable to theExecutive, those provided generally at any time after the Effective Date to other peer executives of theCompany and the Affiliated Companies. If, on or prior to the Executive’s Date of Termination,the Executive has attained at least age 50 with at least 20 years of service with the Company(including all cumulative service, notwithstanding any breaks in service) the Executive shallbe entitled to retiree medical and life insurance benefits at least equal to those that wereprovided to peer executives of the Company and the Affiliated Companies and their dependents (taking intoaccount any required employee contributions, co-payments and similar costs imposed on theexecutives and the executives’ dependents and the tax treatment of participation in the plans,programs, practices and policies by the executives and the executives’ dependents) inaccordance with the retiree medical plans, programs, practices and policies of the Company and theAffiliated Companies in effect as of the Date of Termination.          (5) **Expenses****.**During the Employment Period, the Executive shall be entitledto receive prompt reimbursement for all reasonable expenses incurred by the Executive inaccordance with the most favorable policies, practices and procedures of the Company and theAffiliated Companies in effect for the Executive at any time during the 120-day period
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***Confidential***immediately preceding the Effective Date or, if more favorable to the Executive, as in effectgenerally at any time thereafter with respect to other peer executives of the Company and theAffiliated Companies.          (6) **Fringe Benefits****.**During the Employment Period, the Executive shall beentitled to fringe benefits, including, without limitation, tax and financial planningservices, payment of club dues, and, if applicable, use of an automobile and payment of relatedexpenses, in accordance with the most favorable plans, practices, programs and policies of the Companyand the Affiliated Companies in effect for the Executive at any time during the 120-day periodimmediately preceding the Effective Date or, if more favorable to the Executive, as in effectgenerally at any time thereafter with respect to other peer executives of the Company and theAffiliated Companies.          (7) **Office and Support Staff****.**During the Employment Period, the Executiveshall be entitled to an office or offices of a size and with furnishings and otherappointments, andto exclusive personal secretarial and other assistance, at least equal to the most favorableof the foregoing provided to the Executive by the Company and the Affiliated Companies at any timeduring the 120-day period immediately preceding the Effective Date or, if more favorable tothe Executive, as provided generally at any time thereafter with respect to other peer executivesof the Company and the Affiliated Companies.          (8) **Vacation****.**During the Employment Period, the Executive shall be entitledto paid vacation in accordance with the most favorable plans, policies, programs and practicesof the Company and the Affiliated Companies as in effect for the Executive at any time during the120-day period immediately preceding the Effective Date or, if more favorable to theExecutive, as in effect generally at any time thereafter with respect to other peer executives of theCompany and the Affiliated Companies.          **Section 4.****Termination of Employment****.**          (a) **Death or Disability****.**The Executive’s employment shall terminateautomatically if the Executive dies during the Employment Period. If the Company determinesin good faith that the Disability (as defined herein) of the Executive has occurred during theEmployment Period (pursuant to the definition of “Disability”), it may give to the Executivewritten notice in accordance with Section 13(b) of its intention to terminate the Executive’semployment. In such event, the Executive’s employment with the Company shall terminateeffective on the 30th day after receipt of such notice by the Executive (the “DisabilityEffective Date”), *provided*that, within 30 days after such receipt, the Executive shall not havereturned to full-time performance of the Executive’s duties. “Disability” means the absence of theExecutive from the Executive’s duties with the Company on a full-time basis for 180consecutive business days as a result of incapacity due to mental or physical illness that is determinedto be total and permanent by a physician selected by the Company or its insurers and acceptable tothe Executive or the Executive’s legal representative.          (b) **Cause****.**The Company may terminate the Executive’s employment duringthe Employment Period for Cause. “Cause” means:
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***Confidential***     (1) the willful and continued failure of the Executive to perform substantially theExecutive’s duties (as contemplated by Section 3(a)(1)(A)) with the Company or any AffiliatedCompany (other than any such failure resulting from incapacity due to physical or mentalillness or following the Executive’s delivery of a Notice of Termination for Good Reason), after awritten demand for substantial performance is delivered to the Executive by the Board or theChief Executive Officer of the Company that specifically identifies the manner in which theBoard or the Chief Executive Officer of the Company believes that the Executive has notsubstantially performed the Executive’s duties, or     (2) the willful engaging by the Executive in illegal conduct or gross misconduct thatis materially and demonstrably injurious to the Company.For purposes of this Section 4(b), no act, or failure to act, on the part of the Executive shallbe considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith orwithout reasonable belief that the Executive’s action or omission was in the best interests of theCompany. Any act, or failure to act, based upon authority given pursuant to a resolution dulyadopted by the Board or upon the instructions of the Chief Executive Officer of the Company or asenior officer of the Company or based upon the advice of counsel for the Company shall beconclusively presumed to be done, or omitted to be done, by the Executive in good faith and in thebest interests of the Company. The cessation of employment of the Executive shall not be deemed tobe for Cause unless and until there shall have been delivered to the Executive a copy of aresolution duly adopted by the affirmative vote of not less than three-quarters of the entiremembership of the Board (excluding the Executive, if the Executive is a member of the Board) at ameeting of the Board called and held for such purpose (after reasonable notice is provided to theExecutive and the Executive is given an opportunity, together with counsel for the Executive, tobe heard before the Board), finding that, in the good faith opinion of the Board, the Executive isguilty of the conduct described in Section 4(b)(1) or 4(b)(2), and specifying the particularsthereof in detail.          (c) **Good Reason****.**The Executive’s employment may be terminated by the Executive forGood Reason or by the Executive voluntarily without Good Reason. “Good Reason” means:     (1) the assignment to the Executive of any duties inconsistent in any respect with theExecutive’s position (including status, offices, titles and reporting requirements),authority, duties or responsibilities as contemplated by Section 3(a), or any other diminution in suchposition (or removal from such position), authority, duties or responsibilities (whether ornot occurring solely as a result of the Company’s ceasing to be a publicly traded entity orbecoming a subsidiary or a division of a publicly traded entity), excluding for this purpose anisolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by theCompany promptly after receipt of notice thereof given by the Executive;     (2) any failure by the Company to comply with any of the provisions of Section 3(b),other than an isolated, insubstantial and inadvertent failure not occurring in bad faith andthat is remedied by the Company promptly after receipt of notice thereof given by the Executive;
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***Confidential***     (3) the Company’s requiring the Executive (i) to be based at any office or locationother than as provided in Section 3(a)(l)(B), (ii) to be based at a location other than theprincipal executive offices of the Company if the Executive was employed at such location immediatelypreceding the Effective Date, or (iii) to travel on Company business to a substantiallygreater extent than required immediately prior to the Effective Date;     (4) the failure by the Company to pay to the Executive any portion of any installmentof deferred compensation, or lump sum under any deferred compensation program of theCompany within 7 days after the Executive provides the Company with written notice of thefailure to pay such compensation when it is due;     (5) the failure by the Company to provide the Executive with the number of paidvacation days and holidays to which the Executive was entitled as of the Effective Date;     (6) any purported termination by the Company of the Executive’s employmentotherwise than as expressly permitted by this Agreement;     (7) any failure by the Company to comply with and satisfy Section 12(c);     (8) if the Company (or the entity effectuating a Change of Control) continues to existand be a company registered under the Securities Exchange Act of 1934, as amended, after theEffective Date and continues to have in effect an equity-compensation plan, the failure of theCompany to grant to the Executive equity-based compensation with respect to a number ofshares of common stock of the Company (or the entity effectuating the Change of Control) atleast as great as the average annual percentage of the outstanding common stock of the Companywith respect to which the Executive received such equity-based compensation during the threecalendar years immediately prior to the Effective Date, which equity-based compensation is onterms, including pricing relative to the market price at the time of grant, that is at leastas favorable to the Executive as the terms of the grant last made to the Executive prior to theEffective Date;     (9) failure to include the Executive in any program or plan of benefits (including, butnot limited to stock option and deferred compensation plans), and failure to provide theExecutive similar levels of benefit amounts or coverage, which benefits are either provided orotherwise offered to peer executives following the Effective Date;     (10) the Executive’s termination of employment for Disability.For purposes of this Section 4(c), any good faith determination of Good Reason made by theExecutive shall be conclusive. Anything in this Agreement to the contrary notwithstanding, atermination by the Executive for any reason pursuant to a Notice of Termination given during the90-day period immediately following the first anniversary of the occurrence of a Change in Control(other than a Change in Control occurring solely under Section 1(d)(3) of this Agreement where allor substantially all of the individuals and entities that were the beneficial owners of theOutstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior toa Business Combination beneficially own, directly or indirectly, more than 50% of thethen-outstanding shares of common stock following the Business Combination) shall be deemed to be atermination for Good Reason for all purposes of this
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***Confidential***Agreement. The Executive’s mental or physical incapacity following the occurrence of an eventdescribed above shall not affect the Executive’s ability to terminate employment for Good Reason.          (d) **Notice of Termination****.**Any termination by the Company for Cause, orby the Executive for Good Reason, shall be communicated by Notice of Termination to the otherparty hereto given in accordance with Section 13(b). “Notice of Termination” means a writtennotice that (1) indicates the specific termination provision in this Agreement relied upon,(2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed toprovide a basis for termination of the Executive’s employment under the provision soindicated, and (3) if the Date of Termination (as defined herein) is other than the date of receipt ofsuch notice, specifies the Date of Termination (which Date of Termination shall be not more than 30days after the giving of such notice). The failure by the Executive or the Company to setforth in the Notice of Termination any fact or circumstance that contributes to a showing of GoodReason or Cause shall not waive any right of the Executive or the Company, respectively,hereunder or preclude the Executive or the Company, respectively, from asserting such fact orcircumstance in enforcing the Executive’s or the Company’s respective rights hereunder.          (e) **Date of Termination****.**“Date of Termination” means (1) if theExecutive’s employment is terminated by the Company for Cause, or by the Executive for GoodReason, the date of receipt of the Notice of Termination or any later date specified in theNotice of Termination, (which date shall not be more than 30 days after the giving of such notice),as the case may be, (2) if the Executive’s employment is terminated by the Company other than forCause or Disability, the Date of Termination shall be the date on which the Company notifiesthe Executive of such termination, and (3) if the Executive’s employment is terminated by reasonof death or Disability, the Date of Termination shall be the date of death of the Executive orthe Disability Effective Date, as the case may be.          **Section**5. **Obligations of the Company upon Termination****.**          (a) **Good Reason, Death: Other Than for Cause****.**If, during the Employment Period, theCompany terminates the Executive’s employment other than for Cause or the Executive resigns forGood Reason or if the Executive’s employment is terminated as a result of the Executive’s death:     (1) the Company shall pay to the Executive (or the Executive’s estate or beneficiary, in theevent of the Executive’s death), in a lump sum in cash within 30 days after the Date ofTermination (or, if required by Section 409A of the Code to avoid the imposition of additionaltaxes, on the date which is six (6) months following the Date of Termination), the aggregate ofthe following amounts:     (A) the sum of (i) the Executive’s Annual Base Salary through the Date of Termination to theextent not theretofore paid, and (ii) any compensation previously deferred by the Executive(together with any accrued interest or earnings thereon) and any accrued vacation pay, in eachcase, to the extent not theretofore paid (the sum of the amounts described in subclauses (i) and(ii) the “Accrued Obligations”); and
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***Confidential***     (B) the amount equal to the product of (i) three and (ii) the amount of base salary and cashbonus paid to the Executive by the Company as reflected on the Executive’s W-2 in the tax yearimmediately preceding the year in which the Date of Termination occurs or the Change of Controloccurs, whichever is greater (in the case of death or resignation for Good Reason by reason of theExecutive’s Disability, reduced (but not below zero) by any death or disability benefits that theExecutive or the Executive’s estate or beneficiaries are entitled to pursuant to plans orarrangements of the Company), provided that if the Executive was not employed by the Company duringsuch entire tax year, item (ii) shall refer to the amount of base salary and cash bonus as agreedto in Executive’s offer of employment letter;     (2) for three years after the Executive’s Date of termination (or such shorter period asrequired by Section 409A of the Code to avoid the imposition of additional taxes), the Companyshall continue benefits to the Executive and/or the Executive’s dependents at least equal tothose that were provided to them (taking into account any required employee contributions, co-payments and similar costs imposed on the Executive and the Executive’s dependents and taxtreatment of participation in plans, programs, practices and policies by the Executive and theExecutive’s dependents) in accordance with the plans, programs, practices, and policiesdescribed in Section 3(b)(4) as of the Date of Termination or, if more favorable to theExecutive, as in effect generally at any time thereafter with respect to other peer executives of theCompany and the Affiliated Companies and their dependents; provided, however, that, if the Executivebecomes reemployed with another employer and is eligible to receive such benefits underanother employer provided plan, the medical and other welfare benefits described herein shallbe secondary to those provided under such other plan during such applicable period ofeligibility. The eligibility of the Executive and the Executive’s dependents, if any, for “COBRA”continuation coverage under Section 4980B of the Code shall begin on the date that thecoverage described in this Section 5(a)(2) ceases to be provided. For purposes of determiningeligibility(but not the time of commencement of benefits) of the Executive for retiree medical and lifeinsurance benefits pursuant to such plans, practices, programs and policies, the Executiveshall be considered to have remained employed until three years after the Date of Termination and tohave retired on the last day of such period in order to determine age and service; and     (3) to the extent not theretofore paid or provided, the Company shall timely pay orprovide to the Executive any Other Benefits (as defined in Section 6).          (b) **Cause; Other Than for Good Reason****.**If the Executive’s employment is terminatedfor Cause during the Employment Period, the Company shall provide to the Executive (1) theExecutive’s Annual Base Salary through the Date of Termination, (2) the amount of any compensationpreviously deferred by the Executive, and (3) the Other Benefits, in each case, to the extenttheretofore unpaid, and shall have no other severance obligations under this Agreement. If theExecutive voluntarily terminates employment during the Employment Period, excluding a terminationfor Good Reason, the Company shall provide to the Executive the Accrued Obligations and the timelypayment or delivery of the Other Benefits, and shall have no other severance obligations underthis Agreement. In such case, all the Accrued Obligations shall be paid to the Executive in a lumpsum in cash within 30 days of the Date of Termination.          **Section 6.****Non-exclusivity of Rights****.**Nothing in this Agreement shall prevent orlimit the Executive’s continuing or future participation in any plan, program, policy or
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***Confidential***practice provided by the Company or the Affiliated Companies and for which the Executive mayqualify, nor, subject to Section 13(f), shall anything herein limit or otherwise affect such rightsas the Executive may have under any other contract or agreement with the Company or the AffiliatedCompanies. Amounts that are vested benefits or that the Executive is otherwise entitled to receiveunder any plan, policy, practice or program of or any other contract or agreement with the Companyor the Affiliated Companies at or subsequent to the Date of Termination (“Other Benefits”) shall bepayable in accordance with such plan, policy, practice or program or contract or agreement, exceptas explicitly modified by this Agreement. In the event that the Executive’s employment isterminated by reason of the Executive’s Disability (or death), with respect to the provision of theOther Benefits, the term “Other Benefits” shall include, and the Executive (or the estate orbeneficiary of the Executive, in the event of the Executive’s death) shall be entitled after theDisability Effective Date (or upon the Executive’s death) to receive, disability (or death)benefits and other benefits at least equal to the most favorable of those generally provided by theCompany and the Affiliated Companies to disabled executives (or to the estates and beneficiaries ofdeceased executives) and/or their families in accordance with such plans, programs, practices andpolicies relating to disability (or death), if any, as in effect generally with respect to otherpeer executives and their families at any time during the 120-day period immediately preceding theEffective Date or, if more favorable to the Executive and/or the Executive’s family, as in effectat any time thereafter generally with respect to other peer executives of the Company and theAffiliated Companies and their families. Notwithstanding the foregoing, if the Executive receivespayments and benefits pursuant to Section 5(a) of this Agreement, the Executive shall not beentitled to any severance pay or benefits under any severance plan, program or policy of theCompany and the Affiliated Companies, unless otherwise specifically provided therein in a specificreference to this Agreement.          **Section 7.****Full Settlement****.**The Company’s obligation to make the payments providedfor in this Agreement and otherwise to perform its obligations hereunder shall not be affected byany set-off, counterclaim, recoupment, defense, or other claim, right or action that the Companymay have against the Executive or others. In no event shall the Executive be obligated to seekother employment or take any other action by way of mitigation of the amounts payable to theExecutive under any of the provisions of this Agreement, and such amounts shall not be reducedwhether or not the Executive obtains other employment. The Company agrees to pay as incurred(within 10 days following the Company’s receipt of an invoice from the Executive), to the fullextent permitted by law, all legal fees and expenses that the Executive may reasonably incur as aresult of any contest (regardless of the outcome thereof) by the Company, the Executive or othersof the validity or enforceability of, or liability under, any provision of this Agreement or anyguarantee of performance thereof (including as a result of any contest by the Executive about theamount of any payment pursuant to this Agreement), plus, in each case, interest on any delayedpayment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the InternalRevenue Code of 1986, as amended (the “Code”).          **Section 8.****Certain Additional Payments by the Company****.**(a) Anything in this Agreementto the contrary notwithstanding and except as set forth below, in the event it shall be determinedthat any Payment would be subject to the Excise Tax, then the Executive shall be entitled toreceive an additional payment (the “Gross-Up Payment”) in an amount such that, after payment bythe Executive of all taxes (and any interest or penalties imposed with respect to such taxes),including, without limitation, any income taxes (and any interest and penalties imposed
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***Confidential***with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Executive retains anamount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. The Company’sobligation to make Gross-Up Payments under this Section 8 shall not be conditioned upon theExecutive’s termination of employment.          (b) Subject to the provisions of Section 8(c), all determinations required to bemade under this Section 8, including whether and when a Gross-Up Payment is required, theamount of such Gross-Up Payment and the assumptions to be utilized in arriving at suchdetermination, shall be made by Deloitte and Touche LLP, or such other nationally recognizedcertified public accounting firm as may be designated by the Executive (the “AccountingFirm”).The Accounting Firm shall provide detailed supporting calculations both to the Company and theExecutive within 15 business days of the receipt of notice from the Executive that there hasbeena Payment or such earlier time as is requested by the Company. In the event that theAccountingFirm is serving as accountant or auditor for the individual, entity or group effecting theChangeof Control, the Executive may appoint another nationally recognized accounting firm to makethe determinations required hereunder (which accounting firm shall then be referred to as theAccounting Firm hereunder). All fees and expenses of the Accounting Firm shall be bornesolely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 8, shallbe paid by the Company to the Executive within 5 days of the receipt of the Accounting Firm’sdetermination. Any determination by the Accounting Firm shall be binding upon the Companyand the Executive. As a result of the uncertainty in the application of Section 4999 of theCode at the time of the initial determination by the Accounting Firm hereunder, it is possible thatGross-Up Payments that will not have been made by the Company should have been made (the“Underpayment”), consistent with the calculations required to be made hereunder. In the eventthe Company exhausts its remedies pursuant to Section 8(c) and the Executive thereafter isrequired to make a payment of any Excise Tax, the Accounting Firm shall determine the amountof the Underpayment that has occurred and any such Underpayment shall be promptly paid bythe Company to or for the benefit of the Executive.          (c) The Executive shall notify the Company in writing of any claim by theInternal Revenue Service that, if successful, would require the payment by the Company of theGross-Up Payment. Such notification shall be given as soon as practicable, but no later than10 business days after the Executive is informed in writing of such claim. The Executive shallapprise the Company of the nature of such claim and the date on which such claim is requestedto be paid. The Executive shall not pay such claim prior to the expiration of the 30-dayperiod following the date on which the Executive gives such notice to the Company (or such shorterperiod ending on the date that any payment of taxes with respect to such claim is due). Ifthe Company notifies the Executive in writing prior to the expiration of such period that theCompany desires to contest such claim, the Executive shall:     (1) give the Company any information reasonably requested by the Company relatingto such claim,     (2) take such action in connection with contesting such claim as the Company shallreasonably request in writing from time to time, including, without limitation, acceptinglegal representation with respect to such claim by an attorney reasonably selected by the Company,
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***Confidential***     (3) cooperate with the Company in good faith in order effectively to contest suchclaim, and     (4) permit the Company to participate in any proceedings relating to such claim;*provided, however,*that the Company shall bear and pay directly all costs and expenses (includingadditional interest and penalties) incurred in connection with such contest, and shall indemnifyand hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax(including interest and penalties) imposed as a result of such representation and payment of costsand expenses. Without limitation on the foregoing provisions of this Section 8(c), the Companyshall control all proceedings taken in connection with such contest, and, at its sole discretion,may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences withthe applicable taxing authority in respect of such claim and may, at its sole discretion, eitherdirect the Executive to pay the tax claimed and sue for a refund or contest the claim in anypermissible manner, and the Executive agrees to prosecute such contest to a determination beforeany administrative tribunal, in a court of initial jurisdiction and in one or more appellatecourts, as the Company shall determine; *provided, however,*that, if the Company directs theExecutive to pay such claim and sue for a refund, the Company shall advance the amount of suchpayment to the Executive, on an interest-free basis, and shall indemnify and hold the Executiveharmless, on an after-tax basis, from any Excise Tax or income tax (including interest orpenalties) imposed with respect to such advance or with respect to any imputed income inconnection with such advance; and *provided, further,*that any extension of the statute oflimitations relating to payment of taxes for the taxable year of the Executive with respect towhich such contested amount is claimed to be due is limited solely to such contested amount.Furthermore, the Company’s control of the contest shall be limited to issues with respect to whichthe Gross-Up Payment would be payable hereunder, and the Executive shall be entitled to settle orcontest, as the case may be, any other issue raised by the Internal Revenue Service or any othertaxing authority.          (d) If, after the receipt by the Executive of an amount advanced by theCompany pursuant to Section 8(c), the Executive becomes entitled to receive any refund withrespect to such claim, the Executive shall (subject to the Company’s complying with therequirements of Section 8(c)) promptly pay to the Company the amount of such refund (togetherwith any interest paid or credited thereon after taxes applicable thereto). If, after thereceipt by he Executive of an amount advanced by the Company pursuant to Section 8(c), a determinationis made that the Executive shall not be entitled to any refund with respect to such claim andthe Company does not notify the Executive in writing of its intent to contest such denial ofrefund prior to the expiration of 30 days after such determination, then such advance shall beforgiven and shall not be required to be repaid and the amount of such advance shall offset, to theextent thereof, the amount of Gross-Up Payment required to be paid.          (e) Notwithstanding any other provision of this Section 8, the Company may,in its sole discretion, withhold and pay over to the Internal Revenue Service or any otherapplicable taxing authority, for the benefit of the Executive, all or any portion of anyGross-Up Payment, and the Executive hereby consents to such withholding.
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***Confidential***          (f) **Definitions****.**The following terms shall have the following meanings for purposesof this Section 8.          (i) “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code, together withany interest or penalties imposed with respect to such excise tax.          (ii) A “Payment” shall mean any payment or distribution in the nature of compensation (withinthe meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paidor payable pursuant to this Agreement or otherwise.          **Section 9.****Covenants of Executive****.**          (a) **Confidential Information****.**The Executive shall hold in a fiduciarycapacity for the benefit of the Company all secret or confidential information, knowledge ordata relating to the Company or the Affiliated Companies, and their respective businesses, whichinformation, knowledge or data shall have been obtained by the Executive during theExecutive’s employment by the Company or the Affiliated Companies and which information, knowledge ordata shall not be or become public knowledge (other than by acts by the Executive orrepresentatives of the Executive in violation of this Agreement). After termination of theExecutive’s employment with the Company, the Executive shall not, without the prior writtenconsent of the Company or as may otherwise be required by law or legal process, communicateor divulge any such information, knowledge or data to anyone other than the Company and thosepersons designated by the Company. In no event shall an asserted violation of the provisionsof this Section 9 constitute a basis for deferring or withholding any amounts otherwise payableto the Executive under this Agreement.          (b) **Non-Competition****.**In consideration for the protections provided to theExecutive under this Agreement, the Executive agrees that from the Date of Termination untilthe first anniversary thereof (the “Covenant Period”), the Executive will not, directly orindirectly, own, manage, operate, control or participate in the ownership, management,operation or control of, or be connected as an officer, employee, partner, director or otherwise with,or (other than through the ownership of not more than five percent (5%) of the voting stock ofany publicly held corporation) have any financial interest in, or aid or assist anyone else in theconduct of, a business which at the time of such termination competes with a businessconducted by the Company or any group, division or subsidiary of the Company (“Company Group”) as ofthe Date of Termination. Notwithstanding the foregoing, the Executive’s employment by abusiness that competes with the business of the Company, or the retention of the Executive asa consultant by any such business shall not violate this Section 9(b) if the Executive’s dutiesand actions for the business are solely for groups, divisions or subsidiaries that are not engagedin a business that competes with a business conducted by the Company. No business shall bedeemed to be a business conducted by the Company unless the Company was engaged in thebusiness as of the Date of Termination and continues to be engaged in the business and atleast twenty-five percent (25%) of the Company’s consolidated gross sales and operating revenues, ornet income, is derived from, or at least twenty-five percent (25%) of the Company’sconsolidated assets are devoted to, such business and no business shall be deemed to compete with abusiness conducted by the Company unless at least twenty-five percent (25%) of the consolidated grosssales and operating revenues, or net income, of any consolidated group that includes the
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***Confidential***business, is derived from, or at least twenty-five percent (25%) of the consolidated assets of anysuch consolidated group are devoted to, such business.          (c) **Non-Solicitation****.**During the Covenant Period, the Executive shall notsolicit on the Executive’s behalf or on behalf of any other person the services, as employee,consultant or otherwise of any person who on the Date of Termination is employed by theCompany Group, whether or not such person would commit any breach of his contract of servicein leaving such employment, except for any employee (i) whose employment is terminated bythe Company or any successor thereof prior to such solicitation of such employee, (ii) whoinitiates discussions regarding such employment without any solicitation by the Executive,(iii) who responds to any public advertisement unless such advertisement is designed totarget, or has the effect of targeting, employees of the Company, or (iv) who is initially solicited fora position other than by the Executive and without any suggestion or advice from the Executive.Nothing herein shall restrict businesses that employ the Executive or retain the Executive asan executive from soliciting from time to time employees of the Company, if (A) such solicitationoccurs in the ordinary course of filling the business’s employment needs, and (B) thesolicitation is made by persons at the business other than the Executive who have not become aware of theavailability of any specific employees as a result of the advice of the Executive          (d) **Continuation of Employment****.**The Executive agrees not to voluntarilyterminate employment with the Company (other than as a result of an event that wouldconstitute Good Reason that is at the request of a third party that has taken steps reasonably calculatedto effectuate a Change of Control or otherwise arose in connection with or in anticipation of aChange of Control) from such time as the Company has entered into an agreement that wouldresult in a Change of Control until the Change of Control; *provided,*that such provision shallcease to apply upon the termination of such agreement or if the Change of Control has notoccurred within one year following the execution of such agreement.          **Section 10.****Arbitration****.**Any dispute or controversy arising under or in connectionwith this Agreement shall be settled exclusively by arbitration in accordance with the rules ofthe American Arbitration Association then in effect. Judgment may be entered on the arbitrator’saward in any court having jurisdiction; *provided, however,*that the Executive shall be entitled toseek specific performance of the Executive’s right to be paid any amounts or provided with anybenefits due to the Executive hereunder during the pendency of any dispute or controversy arisingunder or in connection with this Agreement.          **Section 11. [Intentionally Omitted]**          **Section 12.****Successors****.**(a) This Agreement is personal to the Executive, and, withoutthe prior written consent of the Company, shall not be assignable by the Executive other than bywill or the laws of descent and distribution. This Agreement shall inure to the benefit of and beenforceable by the Executive’s legal representatives.          (b) This Agreement shall inure to the benefit of and be binding upon the Company and itssuccessors and assigns. Except as provided in Section 12(c), without the prior written consent ofthe Executive this Agreement shall not be assignable by the Company.
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***Confidential***          (c) The Company will require any successor (whether direct or indirect, by purchase, merger,consolidation or otherwise) to all or substantially all of the business and/or assets of theCompany to assume expressly and agree to perform this Agreement in the same manner and to the sameextent that the Company would be required to perform it if no such succession had taken place.“Company” means the Company as hereinbefore defined and any successor to its business and/orassets as aforesaid that assumes and agrees to perform this Agreement by operation of law orotherwise.          **Section 13.****Miscellaneous****.**(a) This Agreement shall be governed by and construed inaccordance with the laws of the State of Pennsylvania, without reference to principles of conflictof laws. The captions of this Agreement are not part of the provisions hereof and shall have noforce or effect. This Agreement may not be amended or modified other than by a written agreementexecuted by the parties hereto or their respective successors and legal representatives.          (b) All notices and other communications hereunder shall be in writing andshall be given by hand delivery to the other party or by registered or certified mail, returnreceipt requested, postage prepaid, addressed as follows:     if to the Executive:at the most recent address on record at the Company.     if to the Company:Mylan Inc.