RECEIPT, EXECUTIVE SHALL NOT HAVE RETURNED TO FULL-TIME PERFORMANCE
OF HIS DUTIES.
FOR PURPOSES OF THIS AGREEMENT, "DISABILITY" SHALL MEAN A
PHYSICAL OR MENTAL IMPAIRMENT WHICH RENDERS EXECUTIVE UNABLE TO PERFORM THE
ESSENTIAL FUNCTIONS OF HIS POSITION, EVEN WITH REASONABLE ACCOMMODATION WHICH
DOES NOT IMPOSE AN UNDUE HARDSHIP ON THE COMPANY.
THE COMPANY RESERVES THE
RIGHT, IN GOOD FAITH, TO MAKE THE DETERMINATION OF DISABILITY UNDER THIS
AGREEMENT BASED UPON INFORMATION SUPPLIED BY EXECUTIVE AND/OR HIS MEDICAL
PERSONNEL, AS WELL AS INFORMATION FROM MEDICAL PERSONNEL (OR OTHERS) SELECTED BY
THE COMPANY OR ITS INSURERS.
4.2
TERMINATION BY COMPANY FOR CAUSE.
(A) THE
COMPANY MAY TERMINATE EXECUTIVE'S EMPLOYMENT FOR CAUSE.
FOR PURPOSES OF THIS
AGREEMENT, "CAUSE" SHALL MEAN THAT THE COMPANY, ACTING IN GOOD FAITH BASED UPON
THE INFORMATION THEN KNOWN TO THE COMPANY, DETERMINES THAT EXECUTIVE HAS ENGAGED
IN OR COMMITTED:
WILLFUL MISCONDUCT; GROSS NEGLIGENCE; THEFT, FRAUD OR OTHER
ILLEGAL CONDUCT; REFUSAL OR UNWILLINGNESS TO PERFORM HIS DUTIES; SEXUAL
HARASSMENT; CONDUCT WHICH REFLECTS ADVERSELY UPON, OR MAKING ANY REMARKS
DISPARAGING OF, THOMAS KINKADE, THE COMPANY, ITS BOARD, OFFICERS, DIRECTORS,
ADVISORS OR EMPLOYEES OR ITS AFFILIATES OR SUBSIDIARIES; INSUBORDINATION; ANY
WILLFUL ACT THAT IS LIKELY TO HAVE THE EFFECT OF INJURING THE REPUTATION,
BUSINESS OR A BUSINESS RELATIONSHIP OF THE COMPANY; CONDUCT OR BEHAVIOR
4
THAT IS IMMORAL; ANY VIOLATION OF ANY FIDUCIARY DUTY; SUBSTANDARD PERFORMANCE;
VIOLATION OF ANY DUTY OF LOYALTY; FAILURE TO RELOCATE TO THE MORGAN HILL/BAY
AREA WITHIN THE TIME FRAME SET FORTH IN SECTION 3.12 OF THIS AGREEMENT; AND
BREACH OF ANY OTHER TERM OF THIS AGREEMENT; PROVIDED, HOWEVER, THAT CAUSE SHALL
NOT INCLUDE ANY FAILURE BY EXECUTIVE TO PERFORM ANY SPECIFIC DUTIES IF SUCH
PERFORMANCE IS SUBJECT TO THE EXISTENCE OF OR SATISFACTION OF CONDITIONS, OR THE
OCCURRENCE OF EVENTS, THAT ARE NOT WITHIN EXECUTIVE'S CONTROL.
(B)
ANY TERMINATION FOR CAUSE SHALL BE AUTHORIZED BY THE BOARD OF DIRECTORS.
EXECUTIVE SHALL BE GIVEN WRITTEN NOTICE BY THE COMPANY OF THE INTENTION TO
TERMINATE HIS EMPLOYMENT HEREUNDER FOR CAUSE (A "CAUSE NOTICE").
EACH CAUSE
NOTICE SHALL STATE THE PARTICULAR ACTION(S) OR INACTION(S) GIVING RISE TO
TERMINATION FOR CAUSE.
IF THE BASIS FOR SUCH TERMINATION IS ONE THAT IS CAPABLE
OF BEING CURED, EXECUTIVE SHALL HAVE THIRTY (30) DAYS AFTER RECEIPT OF THE CAUSE
NOTICE TO CURE THE PARTICULAR ACTION(S) OR INACTION(S). IF EXECUTIVE EFFECTS A
CURE TO THE SATISFACTION OF THE BOARD OF DIRECTORS, EXERCISED IN THEIR GOOD
FAITH REASONABLE BUSINESS JUDGMENT, THE BOARD OF DIRECTORS SHALL PROVIDE WRITTEN
NOTICE OF THE RESCISSION OF THE CAUSE NOTICE, AND IT SHALL BE OF NO FURTHER
FORCE OR EFFECT.
IF THE BASIS FOR TERMINATION IS NOT ONE THAT IS CAPABLE OF
BEING CURED, THE CAUSE NOTICE SHALL SERVE AS THE NOTICE OF TERMINATION AND THE
TERMINATION DATE SPECIFIED THEREIN SHALL BE THE COMPLETION DATE FOR ALL OTHER
PURPOSES OF THIS AGREEMENT.
4.3
OTHER THAN CAUSE OR DEATH OR DISABILITY OR
GOOD REASON.
EITHER THE COMPANY OR EXECUTIVE MAY TERMINATE EXECUTIVE'S
EMPLOYMENT AT ANY TIME, WITH OR WITHOUT CAUSE