will be governed by and
construed and enforced in accordance with the laws of the state of Minnesota
applicable to contracts made and to be performed in such state without giving
effect to the principles of conflicts of laws thereof.
18.
WITHHOLDING. ALL AMOUNTS PAYABLE TO THE EXECUTIVE AS COMPENSATION
HEREUNDER SHALL BE SUBJECT TO ALL CUSTOMARY WITHHOLDING, PAYROLL AND OTHER
TAXES.
THE COMPANY SHALL BE ENTITLED TO DEDUCT OR WITHHOLD FROM ANY AMOUNTS
PAYABLE TO THE EXECUTIVE ANY FEDERAL, STATE, LOCAL OR FOREIGN WITHHOLDING TAXES,
EXCISE TAX, OR EMPLOYMENT TAXES IMPOSED WITH RESPECT TO THE EXECUTIVE'S
COMPENSATION OR OTHER PAYMENTS OR THE EXECUTIVE'S OWNERSHIP INTEREST IN THE
COMPANY (INCLUDING, WITHOUT LIMITATION, WAGES, BONUSES, DIVIDENDS, THE RECEIPT
OR EXERCISE OF EQUITY OPTIONS AND/OR THE RECEIPT OR VESTING OF RESTRICTED
EQUITY).
19.
Section 409A Compliance.
(A)
COMPLIANCE.
IT IS THE INTENTION OF THE PARTIES TO THIS
EMPLOYMENT AGREEMENT THAT NO PAYMENT OR ENTITLEMENT PURSUANT TO THIS EMPLOYMENT
AGREEMENT WILL GIVE RISE TO ANY ADVERSE TAX CONSEQUENCES TO THE EXECUTIVE UNDER
SECTION 409A OF THE CODE.
THE EMPLOYMENT AGREEMENT SHALL BE INTERPRETED TO THAT
END AND, CONSISTENT WITH THAT OBJECTIVE AND NOTWITHSTANDING ANY PROVISION HEREIN
TO THE CONTRARY, THE COMPANY AND THE EXECUTIVE SHALL, TO THE EXTENT NECESSARY TO
COMPLY WITH SECTION 409A OF THE CODE, AGREE TO ACT REASONABLY AND IN GOOD FAITH
TO MUTUALLY REFORM THE PROVISIONS OF THIS EMPLOYMENT AGREEMENT TO AVOID THE
APPLICATION OF OR EXCISE TAX UNDER SECTION 409A OF THE CODE.
TO THIS END, THE
PARTIES AGREE THAT THE SEVERANCE BENEFITS PAYABLE UNDER THIS EMPLOYMENT
AGREEMENT WILL BE PAID ONLY UPON A "SEPARATION FROM SERVICE" (WITHIN THE MEANING
OF SECTION 409A OF THE CODE) THAT OCCURS COINCIDENT WITH OR FOLLOWING THE DATE
OF TERMINATION.
NOTWITHSTANDING ANY OTHER PROVISION HEREIN, IF THE EXECUTIVE IS
A "SPECIFIED EMPLOYEE", AS DEFINED IN, AND PURSUANT TO, REG.
SECTION 1.409A-1(I) OR ANY
10
SUCCESSOR REGULATION, ON THE DATE OF TERMINATION, ANY PAYMENT PROVIDED HEREUNDER
THAT IS DESIGNATED AS BEING "SUBJECT TO SECTION 19" SHALL BE MADE TO THE
EXECUTIVE NO EARLIER THAN
(I) THE DATE WHICH IS SIX (6) MONTHS FROM THE DATE OF
TERMINATION; OR (II) THE DATE OF THE EXECUTIVE'S DEATH (THE "DELAY PERIOD").
IF
ANY PAYMENT TO THE EXECUTIVE IS DELAYED PURSUANT TO THE FOREGOING SENTENCE ALL
PAYMENTS DUE DURING THE DELAY PERIOD WILL BE PAID TO THE EXECUTIVE OR HIS ESTATE
IN A LUMP SUM ON THE FIRST BUSINESS DAY FOLLOWING THE EXPIRATION OF THE
SIX-MONTH PERIOD REFERRED TO IN THE PRIOR SENTENCE OR THE DATE OF THE
EXECUTIVE'S DEATH, AS APPLICABLE, AND ALL REMAINING AMOUNTS SHALL BE PAID IN
ACCORDANCE WITH THE NORMAL PAYMENT DATES SPECIFIED IN THIS EMPLOYMENT AGREEMENT.
(B)
PAYMENT PERIOD.
WHENEVER A PAYMENT UNDER THIS AGREEMENT SPECIFIES
A PAYMENT PERIOD WITH REFERENCE TO A NUMBER OF DAYS (E.G., "PAYMENT SHALL BE
MADE WITHIN NINETY (90) DAYS FOLLOWING THE DATE OF TERMINATION), THE ACTUAL DATE
OF PAYMENT WITHIN THE SPECIFIED PERIOD SHALL BE WITHIN THE SOLE DISCRETION OF
THE COMPANY.
(C)
REIMBURSEMENT.
WITH