(I)
A CHANGE OF CONTROL (AS DEFINED BELOW) OCCURS DURING THE TERM OF
THIS AGREEMENT OR ANY EXTENSION THEREOF, AND
(II)
(A) EMPLOYEE'S EMPLOYMENT IS TERMINATED IN ANTICIPATION OF A
CHANGE OF CONTROL, OR (B) EMPLOYEE IS EMPLOYED BY THE COMPANY OR AN AFFILIATE
THEREOF AT THE TIME SUCH CHANGE OF CONTROL OCCURS, AND AT ANY TIME DURING THE
TWO-YEAR PERIOD FOLLOWING SUCH CHANGE OF CONTROL,
(1)
EMPLOYEE IS GIVEN NOTICE OF NON-RENEWAL OF THIS AGREEMENT PURSUANT
TO SECTION 2 HEREOF, OR HIS EMPLOYMENT IS TERMINATED BY THE COMPANY OR AN
AFFILIATE OR SUCCESSOR THEREOF FOR ANY REASON OTHER THAN FOR DEATH, DISABILITY
OR CAUSE, OR
(2)
EMPLOYEE TERMINATES HIS EMPLOYMENT DURING THE WINDOW PERIOD, AS
HEREINAFTER DEFINED, FOR ANY REASON OTHER THAN DEATH OR DISABILITY, OR EMPLOYEE
TERMINATES HIS EMPLOYMENT FOR GOOD REASON,
the Company (or its successors) shall pay Employee, or his beneficiary in the
event of his subsequent death, subject to applicable federal and state income,
social security and other employment tax withholding, an amount (the "Change of
Control Payment") equal to .99 times Employee's Total Compensation in effect at
the date of termination of employment.
The Change of Control Payment is in lieu of and not in addition to any payments
provided for under Section 6 of this Agreement, but the Change of Control
Payment is in addition to the payment for Employee's covenant not to compete
provided for under Section 9(f) of this Agreement.
The Change of Control
Payment shall be paid in a lump sum at the time of termination without any
reduction for commutation to present value.
(B)
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN THE
EVENT IT SHALL BE DETERMINED THAT ANY PAYMENT OR DISTRIBUTION TO OR FOR THE
BENEFIT OF THE EMPLOYEE (WHETHER PAID OR PAYABLE OR DISTRIBUTED OR DISTRIBUTABLE
PURSUANT TO THE TERMS OF THIS AGREEMENT OR OTHERWISE, BUT DETERMINED WITHOUT
REGARD TO ANY ADDITIONAL PAYMENTS REQUIRED UNDER THIS SECTION 7(B) (A
"PAYMENT")) WOULD BE SUBJECT TO THE EXCISE TAX IMPOSED BY SECTION 4999 OF THE
CODE OR ANY INTEREST OR PENALTIES ARE INCURRED BY THE EMPLOYEE WITH RESPECT TO
SUCH EXCISE TAX (SUCH
6
EXCISE TAX, TOGETHER WITH ANY SUCH INTEREST AND PENALTIES, ARE HEREINAFTER
COLLECTIVELY REFERRED TO AS THE "EXCISE TAX"), THEN THE EMPLOYEE SHALL BE
ENTITLED TO RECEIVE (TO THE EXTENT NOT PAID DIRECTLY BY THE COMPANY AS
WITHHOLDING TAXES) AN ADDITIONAL PAYMENT (A "GROSS-UP PAYMENT") IN AN AMOUNT
SUCH THAT AFTER PAYMENT BY THE EMPLOYEE OF ALL TAXES (INCLUDING ANY INTEREST OR
PENALTIES IMPOSED WITH RESPECT TO SUCH TAXES) WITH RESPECT TO PAYMENTS
INCLUDING, WITHOUT LIMITATION, ANY INCOME TAXES (AND ANY INTEREST AND PENALTIES
IMPOSED WITH RESPECT THERETO) AND EXCISE TAX IMPOSED UPON THE GROSS-UP PAYMENT,
THE EMPLOYEE RETAINS AN AMOUNT OF THE GROSS-UP PAYMENT EQUAL TO THE EXCISE TAX
IMPOSED UPON THE PAYMENTS.
ALL DETERMINATIONS REQUIRED TO BE MADE UNDER THIS SECTION 7(B), INCLUDING
WHETHER AND WHEN A GROSS-UP PAYMENT IS REQUIRED AND THE AMOUNT OF SUCH GROSS-UP
PAYMENT AND THE ASSUMPTIONS