OF THE CODE.
ANY PAYMENTS THAT QUALIFY FOR THE
"SHORT-TERM DEFERRAL" EXCEPTION OR ANOTHER EXCEPTION UNDER SECTION 409A OF THE
CODE SHALL BE PAID UNDER THE APPLICABLE EXCEPTION.
FOR PURPOSES OF THE
LIMITATIONS ON NONQUALIFIED DEFERRED COMPENSATION UNDER SECTION 409A OF THE
CODE, EACH PAYMENT OF COMPENSATION UNDER THIS AGREEMENT SHALL BE TREATED AS A
SEPARATE PAYMENT OF COMPENSATION FOR PURPOSES OF APPLYING THE SECTION
12
409A OF THE CODE DEFERRAL ELECTION RULES AND THE EXCLUSION UNDER SECTION 409A OF
THE CODE FOR CERTAIN SHORT-TERM DEFERRAL AMOUNTS.
ALL PAYMENTS OF DEFERRED
COMPENSATION TO BE MADE UPON A TERMINATION OF EMPLOYMENT UNDER THIS AGREEMENT
MAY BE MADE ONLY UPON A "SEPARATION FROM SERVICE" UNDER SECTION 409A OF THE
CODE.
IN NO EVENT MAY EXECUTIVE, DIRECTLY OR INDIRECTLY, DESIGNATE THE CALENDAR
YEAR OF ANY PAYMENT UNDER THIS AGREEMENT.
B.
IN-KIND BENEFITS AND REIMBURSEMENTS.
NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, ALL REIMBURSEMENTS
AND IN-KIND BENEFITS PROVIDED UNDER THIS AGREEMENT SHALL BE MADE OR PROVIDED IN
ACCORDANCE WITH THE REQUIREMENTS OF SECTION 409A OF THE CODE, INCLUDING, WHERE
APPLICABLE, THE REQUIREMENT THAT (I) ANY REIMBURSEMENT IS FOR EXPENSES INCURRED
DURING EXECUTIVE'S LIFETIME (OR DURING A SHORTER PERIOD OF TIME SPECIFIED IN
THIS AGREEMENT); (II) THE AMOUNT OF EXPENSES ELIGIBLE FOR REIMBURSEMENT, OR IN
KIND BENEFITS PROVIDED, DURING A CALENDAR YEAR MAY NOT AFFECT THE EXPENSES
ELIGIBLE FOR REIMBURSEMENT, OR IN KIND BENEFITS TO BE PROVIDED, IN ANY OTHER
CALENDAR YEAR; (III) THE REIMBURSEMENT OF AN ELIGIBLE EXPENSE WILL BE MADE NO
LATER THAN THE LAST DAY OF THE CALENDAR YEAR FOLLOWING THE YEAR IN WHICH THE
EXPENSE IS INCURRED; AND (IV) THE RIGHT TO REIMBURSEMENT OR IN KIND BENEFITS IS
NOT SUBJECT TO LIQUIDATION OR EXCHANGE FOR ANOTHER BENEFIT.
C.
DELAY OF PAYMENTS.
NOTWITHSTANDING ANY OTHER
PROVISION OF THIS AGREEMENT TO THE CONTRARY, IF EXECUTIVE IS CONSIDERED A
"SPECIFIED EMPLOYEE" FOR PURPOSES OF SECTION 409A OF THE CODE (AS DETERMINED IN
ACCORDANCE WITH THE METHODOLOGY ESTABLISHED BY THE COMPANY AS IN EFFECT ON THE
DATE OF TERMINATION), ANY PAYMENT THAT CONSTITUTES NONQUALIFIED DEFERRED
COMPENSATION WITHIN THE MEANING OF SECTION 409A OF THE CODE THAT IS OTHERWISE
DUE TO EXECUTIVE UNDER THIS AGREEMENT DURING THE SIX (6) MONTH PERIOD FOLLOWING
HIS SEPARATION FROM SERVICE (AS DETERMINED IN ACCORDANCE WITH SECTION 409A OF
THE CODE) ON ACCOUNT OF HIS SEPARATION FROM SERVICE SHALL BE ACCUMULATED AND
PAID TO EXECUTIVE ON THE FIRST BUSINESS DAY OF THE SEVENTH MONTH FOLLOWING HIS
SEPARATION FROM SERVICE (THE "DELAYED PAYMENT DATE").
IF EXECUTIVE DIES DURING
THE POSTPONEMENT PERIOD, THE AMOUNTS AND ENTITLEMENTS DELAYED ON ACCOUNT OF
SECTION 409A OF THE CODE SHALL BE PAID TO THE PERSONAL REPRESENTATIVE OF HIS
ESTATE ON THE FIRST TO OCCUR OF THE DELAYED PAYMENT DATE OR THIRTY (30) DAYS
AFTER THE DATE OF EXECUTIVE'S DEATH.
12.
MISCELLANEOUS.
A.
GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
B.
ENTIRE AGREEMENT/AMENDMENTS.
THIS AGREEMENT