19, 2007.
J.
VACATION PAY.
MR. IMBRIANI ACKNOWLEDGES THAT HE HAS BEEN PAID
FOR ALL ACCRUED AND UNUSED VACATION TIME FOR THE CALENDAR YEAR 2006 AND THAT HE
IS NOT ENTITLED TO ANY ADDITIONAL VACATION PAY FOR CALENDARS YEARS 2007 AND
2008.
K.
CONSULTING SERVICES AGREEMENT.
IN EXCHANGE FOR ENTERING INTO
THIS TRANSITION AGREEMENT, THE COMPANY HEREBY AGREES TO ENTER INTO A CONSULTING
SERVICES AGREEMENT, ATTACHED HERETO AS APPENDIX C AND MADE A PART HEREOF.
IN
ACCORDANCE WITH THE CONSULTING SERVICES AGREEMENT, THE COMPANY FURTHER AGREES TO
PAY MR. IMBRIANI'S CONSULTING FEES OF SEVENTY THOUSAND DOLLARS ($70,000) IN A
SINGLE LUMP SUM PAYMENT ON OR BEFORE DECEMBER 30, 2006.
L.
LEGAL FEES.
WITHIN 30 DAYS OF THE PRESENTATION OF PROPER
INVOICES, THE COMPANY AGREES TO PAY UP TO A MAXIMUM OF THREE THOUSAND DOLLARS
($3,000) OF REASONABLE LEGAL FEES AND EXPENSES DUE MORGAN, LEWIS & BOCKIUS LLP,
IN CONNECTION WITH THE LEGAL ADVICE MR. IMBRIANI RECEIVED CONCERNING THIS
TRANSITION AGREEMENT, THE GENERAL RELEASE AND THE CONSULTING AGREEMENT.
MORGAN,
LEWIS & BOCKIUS LLP IS AN INTENDED THIRD PARTY BENEFICIARY OF THIS SECTION 2.L.
M.
GROSS-UP PAYMENTS PURSUANT TO INTERNAL REVENUE CODE.
(I)
IF ANY PAYMENT OR DISTRIBUTION BY THE COMPANY TO OR FOR THE
BENEFIT OF MR. IMBRIANI, WHETHER PAID UNDER THIS AGREEMENT OR OTHERWISE, (A
"PAYMENT") WOULD BE SUBJECT TO THE EXCISE TAX IMPOSED BY CODE SECTION 4999, OR
ANY INTEREST OR PENALTIES WITH RESPECT TO SUCH EXCISE TAX (SUCH EXCISE TAX,
TOGETHER WITH ANY SUCH INTEREST AND PENALTIES, ARE HEREINAFTER COLLECTIVELY
REFERRED TO AS THE "EXCISE TAX"), THEN MR. IMBRIANI SHALL BE ENTITLED TO RECEIVE
AN ADDITIONAL PAYMENT (A "GROSS-UP PAYMENT") IN AN AMOUNT SUCH THAT, AFTER MR.
IMBRIANI PAYS ALL TAXES OF ANY NATURE (INCLUDING ANY INTEREST OR PENALTIES
IMPOSED WITH RESPECT TO SUCH TAXES AND ANY EXCISE TAX IMPOSED UPON THE GROSS-UP
PAYMENT), MR. IMBRIANI SHALL RETAIN AN AMOUNT OF THE GROSS-UP PAYMENT EQUAL TO
THE EXCISE TAX IMPOSED UPON THE PAYMENT.
(II)
SUBJECT TO THE PROVISIONS OF SUBPARAGRAPH (V)BELOW, ALL
DETERMINATIONS REQUIRED TO BE MADE UNDER THIS SUBSECTION, INCLUDING WHETHER A
GROSS-UP PAYMENT IS REQUIRED AND THE AMOUNT OF SUCH GROSS-UP PAYMENT, SHALL BE
MADE BY THE AN ACCOUNTANT DESIGNATED BY THE COMPANY (THE "ACCOUNTANT").
THE
COMPANY SHALL REQUEST THE ACCOUNTANT TO PROVIDE DETAILED SUPPORTING CALCULATIONS
TO THE MR. IMBRIANI BY JANUARY 15, 2007.
ANY DETERMINATION BY THE ACCOUNTANT
SHALL BE BINDING UPON THE COMPANY AND MR. IMBRIANI.
(III)
THE INITIAL GROSS-UP PAYMENT, IF ANY, AS DETERMINED PURSUANT TO
THIS SECTION, SHALL BE PAID TO IMBRIANI WITHIN FIVE (5) DAYS OF THE RECEIPT OF
THE ACCOUNTANT'S DETERMINATION.
IF THE ACCOUNTANT DETERMINES THAT NO EXCISE TAX
IS PAYABLE BY MR. IMBRIANI, IT SHALL FURNISH MR. IMBRIANI WITH AN OPINION, ON
WHICH HE MAY RELY IN FILING HIS FEDERAL AND STATE INCOME TAX RETURNS, THAT THAT
THERE IS SUBSTANTIAL AUTHORITY THAT MR. IMBRIANI IS NOT REQUIRED TO REPORT ANY
EXCISE TAX ON HIS FEDERAL INCOME TAX RETURN.
(IV)
IF MR. IMBRIANI IS REQUIRED TO PAY ANY EXCISE TAX