A CONTROLLING EQUITY
INTEREST, PROVIDED, HOWEVER, THAT (I) THE COMPANY SHALL INDEMNIFY EXECUTIVE FROM
LIABILITIES IN CONNECTION WITH SERVING IN ANY SUCH POSITION TO THE SAME EXTENT
AS HIS INDEMNIFICATION RIGHTS PURSUANT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION, BYLAWS AND APPLICABLE DELAWARE LAW, AND (II) SUCH SERVICE SHALL
NOT MATERIALLY DETRACT FROM THE RESPONSIBILITIES OF EXECUTIVE TO THE COMPANY AS
SET FORTH HEREIN OR HIS ABILITY TO PERFORM SUCH RESPONSIBILITIES.
3.
COMPENSATION.
(A)
BASE SALARY.
DURING THE TERM, THE COMPANY WILL PAY TO EXECUTIVE AN ANNUAL
BASE SALARY OF NOT LESS THAN $1,025,000 ("BASE SALARY"), WHICH WILL BE PAYABLE
IN ARREARS IN ACCORDANCE WITH THE COMPANY'S NORMAL PAYROLL PROCEDURES IN THE
AMOUNT OF $39,423.08 PER BI-WEEKLY PAY PERIOD, AND WILL BE REVIEWED ANNUALLY BY
THE BOARD AND WILL BE SUBJECT TO INCREASES AT THE DISCRETION OF THE BOARD OR AN
AUTHORIZED COMMITTEE OR REPRESENTATIVE THEREOF.
AFTER ANY SUCH INCREASE, THE
TERM "BASE SALARY" AS UTILIZED IN THIS AGREEMENT WILL THEREAFTER REFER TO THE
ADJUSTED AMOUNT.
(B)
SIGN-ON BONUS.
(I)
IF EXECUTIVE'S EMPLOYMENT WITH THE COMPANY IS TERMINATED FOR ANY REASON
PRIOR TO THE FIRST ANNIVERSARY OF THE EFFECTIVE DATE, EXECUTIVE WILL REPAY TO
THE COMPANY THE RELOCATION AND SIGNING BONUS (AS DEFINED IN THE PRIOR AGREEMENT)
IN ACCORDANCE WITH THE COMPANY'S STANDARD SIGN-ON BONUS AGREEMENT.
(II)
THE COMPANY GRANTED TO THE EXECUTIVE ON THE EFFECTIVE DATE (A) AN OPTION
TO PURCHASE THREE HUNDRED THOUSAND (300,000) SHARES OF COMPANY COMMON STOCK (THE
"COMMON STOCK") WITH AN EXERCISE PRICE EQUAL TO THE FAIR MARKET VALUE OF THE
COMMON STOCK AT THE CLOSE OF MARKET ON THE EFFECTIVE DATE, WHICH VEST OVER FOUR
YEARS AT A RATE OF 25% OF THE STOCK SUBJECT THERETO ON EACH ANNIVERSARY OF THE
EFFECTIVE DATE; AND (B) TWO HUNDRED FIFTY THOUSAND (250,000) RESTRICTED STOCK
UNITS, WHICH VEST OVER THREE YEARS AT A RATE OF 33.33% OF THE UNITS AWARDED
HEREIN ON EACH ANNIVERSARY OF THE EFFECTIVE DATE (COLLECTIVELY, THE "SIGN-ON
EQUITY GRANTS").
SUBJECT TO THE PROVISIONS OF THIS SUBSECTION, THE SIGN-ON
EQUITY GRANTS SHALL BE GOVERNED BY AND SHALL BE SUBJECT TO THE RULES OF THE
EQUITY AND OTHER LONG-TERM INCENTIVE PROGRAMS OF THE COMPANY UNDER WHICH SUCH
GRANTS ARE AUTHORIZED, AND OF THE AWARD AGREEMENTS PURSUANT TO WHICH SUCH GRANTS
ARE MADE.
(C)
INCENTIVE BONUS.
DURING THE TERM, EXECUTIVE WILL BE ELIGIBLE TO RECEIVE AN
ANNUAL INCENTIVE BONUS AS DETERMINED UNDER THE COMPANY'S ANNUAL BONUS PROGRAM
(AS MAY BE AMENDED FROM TIME TO TIME) ESTABLISHED BY THE BOARD.
THE ANNUAL
INCENTIVE BONUS FOR EXECUTIVE WILL BE NOT LESS THAN 125% OF EXECUTIVE'S BASE
SALARY (THE "TARGET BONUS") AND THE MAXIMUM ANNUAL INCENTIVE BONUS WILL BE
2
200% OF EXECUTIVE'S BASE SALARY, BASED ON ACHIEVEMENT OF FINANCIAL GOALS AS
AGREED TO IN WRITING BY THE BOARD.
NOTWITHSTANDING THE FOREGOING, EXECUTIVE'S
ANNUAL INCENTIVE BONUS FOR (I) THE PERIOD BEGINNING ON THE EFFECTIVE DATE AND
ENDING ON JUNE 19, 2008 ("PERIOD 1") WAS NO LESS THAN THE GREATER OF (A) 50% OF
THE TARGET BONUS OR (B) THE