FOR
GOOD REASON (AS DEFINED BELOW), THE COMPANY SHALL PAY THE EMPLOYEE, FROM THE
DATE OF TERMINATION, IN ADDITION TO ANY PAYMENTS TO WHICH THE EMPLOYEE IS
ENTITLED UNDER THE COMPANY'S SEVERANCE PAY PLAN, TWELVE (12) MONTHS OF BASE
SALARY AT THE EMPLOYEE'S ANNUAL BASE SALARY LEVEL IN EFFECT AT THE TIME OF SUCH
TERMINATION OR IMMEDIATELY PRIOR TO THE SALARY REDUCTION THAT SERVES AS THE
BASIS FOR TERMINATION FOR GOOD REASON.
EMPLOYEE WILL ALSO BE ENTITLED TO
PAYMENT OF AN AMOUNT OF CASH EQUAL TO $20,000.
THE AGGREGATE BASE SALARY AND
OTHER CASH AMOUNT PAYABLE SHALL BE PAID BY THE COMPANY TO THE EMPLOYEE IN ONE
LUMP SUM ON THE FIRST DAY FOLLOWING THE SIX (6) MONTH
3
ANNIVERSARY OF THE DATE OF THE EMPLOYEE'S TERMINATION.
FOR PURPOSES OF THIS
AGREEMENT, THE TERM "TERMINATION" WHEN USED IN THE CONTEXT OF A CONDITION TO, OR
TIMING OF, PAYMENT HEREUNDER SHALL BE INTERPRETED TO MEAN A "SEPARATION FROM
SERVICE" AS THAT TERM IS USED IN SECTION 409A OF THE CODE.
(B)
EMPLOYEE WILL ALSO BE ENTITLED TO TWELVE
(12) MONTHS OF HEALTH BENEFITS CONTINUATION IF TERMINATED UNDER CIRCUMSTANCES
DESCRIBED IN SUBPART (A) ABOVE.
TO THE EXTENT ANY SUCH BENEFITS CANNOT BE
PROVIDED TO THE EMPLOYEE ON A NON-TAXABLE BASIS AND THE PROVISION THEREOF WOULD
CAUSE ANY PART OF THE BENEFITS TO BE SUBJECT TO ADDITIONAL TAXES AND INTEREST
UNDER SECTION 409A OF THE CODE, THEN THE PROVISION OF SUCH BENEFITS SHALL BE
DEFERRED TO THE EARLIEST DATE UPON WHICH SUCH BENEFITS CAN BE PROVIDED WITHOUT
BEING SUBJECT TO SUCH ADDITIONAL TAXES AND INTEREST.
(C)
SOLELY FOR PURPOSES OF THIS AGREEMENT,
"CAUSE" SHALL INCLUDE:
I.
THE CONVICTION OF A FELONY, A CRIME OF
MORAL TURPITUDE OR FRAUD OR HAVING COMMITTED FRAUD, MISAPPROPRIATION OR
EMBEZZLEMENT IN CONNECTION WITH THE PERFORMANCE OF HIS DUTIES HEREUNDER,
II.
WILLFUL AND REPEATED FAILURES TO
SUBSTANTIALLY PERFORM HIS ASSIGNED DUTIES; OR
III.
A VIOLATION OF ANY PROVISION OF THIS
AGREEMENT OR EXPRESS SIGNIFICANT POLICIES OF THE COMPANY.
(D)
SOLELY FOR PURPOSES OF THIS AGREEMENT,
TERMINATION FOR "GOOD REASON" SHALL MEAN TERMINATION OF EMPLOYMENT BY THE
EMPLOYEE WITHIN NINETY (90) DAYS AFTER:
I.
BEING DEMOTED, OR
II.
BEING GIVEN NOTICE OF A REDUCTION IN HIS
OR HER ANNUAL BASE SALARY (OTHER THAN A REDUCTION OF NOT MORE THAN 10%
APPLICABLE TO ALL SENIOR OFFICERS OF THE COMPANY).
(E)
THE COMPANY'S OBLIGATION TO PROVIDE
CONTINUING SALARY AND HEALTH INSURANCE BENEFITS UNDER THIS SECTION 3 SHALL BE
CONTINGENT UPON THE FOLLOWING:
I.
EMPLOYEE'S EXECUTION OF A RELEASE IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, WHICH RELEASES ANY AND ALL CLAIMS
(OTHER THAN AMOUNTS TO BE PAID TO EMPLOYEE AS EXPRESSLY PROVIDED FOR UNDER THIS
AGREEMENT) THE EMPLOYEE HAS OR MAY HAVE AGAINST THE COMPANY OR ITS
4
SUBSIDIARIES, AGENTS, OFFICERS, DIRECTORS, SUCCESSORS OR ASSIGNS ARISING UNDER
ANY PUBLIC POLICY, TORT, CONTRACT OR COMMON LAW OR ANY PROVISION OF STATE,
FEDERAL OR LOCAL LAW, INCLUDING, BUT NOT LIMITED TO, THE PENNSYLVANIA HUMAN
RELATIONS ACT, THE AMERICANS WITH DISABILITIES ACT, TITLE VII