OF ITS INTENT NOT TO EXTEND THE EMPLOYMENT PERIOD AT LEAST SIXTY (60) DAYS PRIOR
TO EACH ANNIVERSARY OF THE EFFECTIVE DATE, THE EMPLOYMENT PERIOD SHALL BE
EXTENDED FOR AN ADDITIONAL YEAR, SO THAT AT ALL TIMES THE EMPLOYMENT PERIOD
SHALL BE FOR A PERIOD OF AT LEAST THREE (3) YEARS, UNLESS EARLIER TERMINATED AS
PROVIDED IN THIS AGREEMENT; PROVIDED, FURTHER, THAT IF A CHANGE IN CONTROL
OCCURS DURING THE EMPLOYMENT PERIOD, THE TERM OF THIS AGREEMENT SHALL CONTINUE
IN EFFECT FOR A PERIOD OF NOT LESS THAN THIRTY-SIX (36) MONTHS BEYOND
6
THE MONTH IN WHICH SUCH CHANGE IN CONTROL OCCURRED.
A DETERMINATION BY EITHER
PARTY NOT TO RENEW THE EMPLOYMENT PERIOD IN ACCORDANCE HEREWITH AND DELIVERY OF
A NOTICE OF SUCH NON-RENEWAL SHALL NOT BE DEEMED A BREACH OF THIS AGREEMENT.
THE EMPLOYMENT PERIOD SHALL TERMINATE AT CORPORATION'S REGULAR CLOSE OF BUSINESS
ON THE DATE OF TERMINATION (OR, IF THE DATE OF TERMINATION IS NOT A REGULAR
BUSINESS DAY, AT 6:00 P.M. PACIFIC TIME ON THE DATE OF TERMINATION).
(C)
TERMINATION BY CORPORATION.
CORPORATION MAY TERMINATE OFFICER'S
EMPLOYMENT HEREUNDER (I) FOR CAUSE (BUT ONLY IN ACCORDANCE WITH
SECTION 2(A)(I) AND ONLY AFTER THE REQUISITE BOARD VOTE HAS BEEN OBTAINED), OR
(II) WITHOUT CAUSE, OR (III) IN THE EVENT OF OFFICER'S DISABILITY.
FOR PURPOSES
OF THIS AGREEMENT, THE TERM "DISABILITY" SHALL MEAN A PHYSICAL OR MENTAL
IMPAIRMENT WHICH RENDERS OFFICER UNABLE TO PERFORM THE ESSENTIAL FUNCTIONS OF
HIS POSITION, EVEN WITH REASONABLE ACCOMMODATION WHICH DOES NOT IMPOSE AN UNDUE
HARDSHIP ON CORPORATION, FOR A PERIOD OF AT LEAST SIX (6) MONTHS.
EXCEPT AS
PROVIDED BELOW, THE DETERMINATION OF WHETHER A DISABILITY EXISTS SHALL BE MADE
BY A MEDICAL DOCTOR SELECTED BY CORPORATION AND OFFICER.
IF THE PARTIES CANNOT
AGREE ON A MEDICAL DOCTOR, EACH PARTY SHALL SELECT A MEDICAL DOCTOR AND THE TWO
DOCTORS SHALL SELECT A THIRD MEDICAL DOCTOR WHO SHALL BE THE APPROVED MEDICAL
DOCTOR FOR THIS PURPOSE.
(D)
TERMINATION BY OFFICER.
OFFICER MAY TERMINATE HIS EMPLOYMENT
HEREUNDER AT ANY TIME (I) FOR GOOD REASON (SUBJECT TO CORPORATION'S OPPORTUNITY
TO CURE, IF APPLICABLE, THE CIRCUMSTANCE(S) GIVING RISE TO GOOD REASON IN THE
TIME PERIOD SET FORTH IN SECTION 2(A)(III)), OR (II) PURSUANT TO A COVERED
RESIGNATION, OR (III) PURSUANT TO A VOLUNTARY TERMINATION OR UPON THIRTY (30)
DAYS' WRITTEN NOTICE OF TERMINATION TO CORPORATION, IN THE EVENT OF OFFICER'S
DISABILITY.
(E)
TERMINATION BY DEATH.
OFFICER'S EMPLOYMENT HEREUNDER SHALL
TERMINATE UPON OFFICER'S DEATH.
(F)
TERMINATIONS IN GENERAL.
ANY TERMINATION OF OFFICER'S EMPLOYMENT
PURSUANT TO SECTION 2(C), 2(D) OR 2(E) SHALL NOT BE DEEMED TO BE A BREACH OF
THIS AGREEMENT.
ANY TERMINATION OF OFFICER'S EMPLOYMENT PURSUANT TO
SECTION 2(C), 2(D) OR DUE TO OFFICER'S DISABILITY SHALL BE COMMUNICATED BY THE
TERMINATING PARTY BY A NOTICE OF TERMINATION.
3.
SALARY, BENEFITS AND BONUS COMPENSATION.
(A)
BASE SALARY.
DURING THE EMPLOYMENT PERIOD, CORPORATION AGREES TO
PAY TO OFFICER A BASE SALARY AT AN ANNUALIZED RATE OF $575,000.00 PER ANNUM
("BASE SALARY") PAYABLE IN ACCORDANCE WITH CORPORATION'S REGULAR PAYROLL
PRACTICES