OF ANY ACTION BY
THE COMPANY WHICH WOULD DIRECTLY OR INDIRECTLY MATERIALLY REDUCE ANY OF SUCH
BENEFITS OR DEPRIVE THE EMPLOYEE OF ANY MATERIAL FRINGE BENEFITS, OR THE FAILURE
BY THE COMPANY TO PROVIDE THE EMPLOYEE WITH THE NUMBER OF PAID VACATION DAYS TO
WHICH HE/SHE IS ENTITLED ON THE BASIS OF YEARS OF SERVICE WITH THE COMPANY IN
ACCORDANCE WITH THE COMPANY'S NORMAL VACATION POLICY, PROVIDED THAT THIS
PARAGRAPH (VI) SHALL NOT APPLY TO ANY PROPORTIONAL ACROSS-THE-BOARD REDUCTION OR
ACTION SIMILARLY AFFECTING ALL EXECUTIVES OF THE COMPANY AND ALL EXECUTIVES OF
ANY PERSON IN CONTROL OF THE COMPANY; OR
(VII)
THE FAILURE OF THE COMPANY TO OBTAIN A SATISFACTORY AGREEMENT FROM
ANY SUCCESSOR TO ASSUME AND AGREE TO PERFORM THIS AGREEMENT, AS CONTEMPLATED IN
SECTION 15 HEREOF, OR ANY OTHER MATERIAL BREACH BY THE COMPANY OF ITS
OBLIGATIONS CONTAINED IN THIS AGREEMENT.
(F)
THE EMPLOYEE'S RIGHT TO SALARY AND BENEFITS CONTINUATION SHALL
ACCRUE UPON THE OCCURRENCE OF EITHER OF THE EVENTS SPECIFIED IN (I) OR (II) OF
SECTION 3(D) AND SHALL CONTINUE AS PROVIDED, NOTWITHSTANDING THE TERMINATION OR
EXPIRATION OF THIS AGREEMENT PURSUANT TO SECTION 1 HEREOF. THE EMPLOYEE'S
SUBSEQUENT EMPLOYMENT, DEATH OR DISABILITY FOLLOWING THE EMPLOYEE'S TERMINATION
OF EMPLOYMENT IN CONNECTION WITH A CHANGE OF CONTROL SHALL NOT AFFECT THE
COMPANY'S OBLIGATION TO CONTINUE MAKING SALARY AND BENEFITS CONTINUATION
PAYMENTS. THE EMPLOYEE SHALL NOT BE REQUIRED TO MITIGATE THE AMOUNT OF ANY
PAYMENT PROVIDED FOR IN THIS SECTION 3 BY SEEKING EMPLOYMENT OR OTHERWISE. THE
RIGHTS TO SALARY AND BENEFITS CONTINUATION SHALL BE IN ADDITION TO WHATEVER
OTHER BENEFITS THE EMPLOYEE MAY BE ENTITLED TO UNDER ANY OTHER AGREEMENT OR
COMPENSATION PLAN, PROGRAM OR ARRANGEMENT OF THE COMPANY; PROVIDED, THAT THE
EMPLOYEE SHALL NOT BE ENTITLED TO ANY SEPARATE OR ADDITIONAL SEVERANCE PAYMENTS
PURSUANT TO THE COMPANY'S SEVERANCE PLAN AS THEN IN EFFECT AND GENERALLY
APPLICABLE TO SIMILARLY SITUATED EMPLOYEES. THE COMPANY SHALL BE AUTHORIZED TO
WITHHOLD FROM ANY PAYMENT TO THE EMPLOYEE, HIS/HER ESTATE OR HIS/HER
BENEFICIARIES HEREUNDER ALL SUCH AMOUNTS, IF ANY, THAT THE COMPANY MAY
REASONABLY DETERMINE IT IS REQUIRED TO WITHHOLD PURSUANT TO ANY APPLICABLE LAW
OR REGULATION.
4.
TERMINATION OF EMPLOYEE FOR CAUSE.
(A)
UPON OR FOLLOWING A CHANGE OF CONTROL, THE COMPANY MAY AT ANY TIME
TERMINATE THE EMPLOYEE'S EMPLOYMENT FOR CAUSE. TERMINATION OF EMPLOYMENT BY THE
7
COMPANY FOR "CAUSE" SHALL MEAN TERMINATION UPON:
(I) THE
WILLFUL AND CONTINUED FAILURE BY THE EMPLOYEE TO SUBSTANTIALLY PERFORM HIS/HER
DUTIES WITH THE COMPANY (OTHER THAN (A) ANY SUCH FAILURE RESULTING FROM
EMPLOYEE'S DISABILITY OR (B) ANY SUCH ACTUAL OR ANTICIPATED FAILURE RESULTING
FROM EMPLOYEE'S TERMINATION OF HIS/HER EMPLOYMENT FOR GOOD REASON), AFTER A
WRITTEN DEMAND FOR SUBSTANTIAL PERFORMANCE IS DELIVERED TO THE EMPLOYEE BY THE
BOARD OF DIRECTORS WHICH SPECIFICALLY IDENTIFIES THE MANNER IN WHICH THE BOARD
OF DIRECTORS BELIEVES THAT THE EMPLOYEE HAS NOT SUBSTANTIALLY PERFORMED HIS/HER
DUTIES, AND WHICH FAILURE HAS NOT BEEN CURED WITHIN THIRTY DAYS (30) AFTER SUCH
WRITTEN DEMAND; OR (II) THE WILLFUL AND CONTINUED ENGAGING BY