PAID TO EXECUTIVE UNDER THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, UNDER SECTION 409A OF THE CODE AND APPLICABLE ADMINISTRATIVE
GUIDANCE AND REGULATIONS.
SECTION 409A GOVERNS PLANS AND ARRANGEMENTS THAT
PROVIDE "NONQUALIFIED DEFERRED COMPENSATION" (AS DEFINED UNDER THE CODE) WHICH
MAY INCLUDE, AMONG OTHERS, NONQUALIFIED RETIREMENT PLANS, BONUS PLANS, STOCK
OPTION PLANS, EMPLOYMENT AGREEMENTS AND SEVERANCE AGREEMENTS.
THE COMPANY
RESERVES THE RIGHT (BUT IS NOT REQUIRED) TO PROVIDE COMPENSATION AND BENEFITS
UNDER ANY PLAN OR ARRANGEMENT IN AMOUNTS, AT TIMES AND IN A MANNER THAT
MINIMIZES TAXES, INTEREST OR PENALTIES AS A RESULT OF SECTION 409A. IN ADDITION,
IN THE EVENT ANY BENEFITS OR AMOUNTS PAID HEREUNDER ARE DEEMED TO BE SUBJECT TO
SECTION 409A, INCLUDING PAYMENTS UNDER SECTION 4, EXECUTIVE CONSENTS TO THE
COMPANY ADOPTING SUCH CONFORMING AMENDMENTS AS THE COMPANY OR EXECUTIVE DEEMS
NECESSARY, IN ITS OR HIS REASONABLE DISCRETION, TO COMPLY WITH SECTION 409A
(INCLUDING, BUT NOT LIMITED TO, DELAYING PAYMENT UNTIL SIX (6) MONTHS FOLLOWING
TERMINATION OF EMPLOYMENT).
ANY INSTALLMENT PAYMENTS MADE TO EXECUTIVE UNDER
THIS AGREEMENT ARE TO BE TREATED AS A SERIES OF SEPARATE PAYMENTS IN ACCORDANCE
WITH THE SECTION 409A RULES.
THE COMPANY AND EXECUTIVE AGREE THAT THEY WILL
COOPERATE IN GOOD FAITH TO ENSURE THAT ALL COMPENSATION PAID TO EXECUTIVE BY THE
COMPANY, WHETHER DIRECTLY OR INDIRECTLY, FULLY COMPLIES WITH SECTION 409A AND
THE REGULATIONS PROMULGATED THEREUNDER SO THAT EXECUTIVE IS NEVER SUBJECT TO ANY
TAX, INTEREST OR PENALTIES UNDER SECTION 409A.
I.
REGISTRATION.
THE COMPANY WILL USE
ITS BEST EFFORTS TO FILE WITH THE SECURITIES AND EXCHANGE COMMISSION AND
THEREAFTER MAINTAIN THE EFFECTIVENESS OF ONE OR MORE REGISTRATION STATEMENTS
REGISTERING UNDER THE SECURITIES ACT OF 1933, AS AMENDED, THE OFFER AND SALE OF
SHARES BY THE COMPANY TO EXECUTIVE PURSUANT TO STOCK OPTIONS OR OTHER
EQUITY-BASED AWARDS GRANTED TO EXECUTIVE UNDER COMPANY PLANS AND THIS AGREEMENT.
J.
ASSISTANTS.
CONSISTENT WITH THE
COMPANY'S PAYROLL POLICIES, THE COMPANY WILL ENGAGE AS FULL-TIME EMPLOYEES ON
EXECUTIVE'S BEHALF, HELEN FLETCHER AS AN EXECUTIVE ASSISTANT (OR HER REPLACEMENT
AS SELECTED BY EXECUTIVE IN HIS SOLE DISCRETION) AND ROBERT LUM AS A DRIVER (OR
HIS REPLACEMENT AS SELECTED BY EXECUTIVE IN HIS SOLE DISCRETION).
4.
TERMINATION OF EMPLOYMENT.
EXECUTIVE'S
EMPLOYMENT HEREUNDER MAY BE TERMINATED PRIOR TO THE END OF THE TERM UNDER THE
FOLLOWING CIRCUMSTANCES:
(A)
TERMINATION BY EXECUTIVE FOR OTHER THAN
GOOD REASON.
EXECUTIVE MAY TERMINATE HIS EMPLOYMENT HEREUNDER FOR ANY REASON OR
NO REASON UPON 45 DAYS' PRIOR WRITTEN NOTICE TO THE COMPANY REFERRING TO THIS
SECTION 4(A); PROVIDED, HOWEVER, THAT A TERMINATION OF EXECUTIVE'S EMPLOYMENT
FOR "GOOD REASON" SHALL NOT CONSTITUTE A TERMINATION BY EXECUTIVE FOR OTHER THAN
GOOD REASON PURSUANT TO THIS SECTION 4(A).
IN THE EVENT EXECUTIVE TERMINATES
HIS EMPLOYMENT FOR OTHER THAN GOOD REASON, EXECUTIVE SHALL BE ENTITLED ONLY TO
THE FOLLOWING COMPENSATION AND BENEFITS (COLLECTIVELY, THE "STANDARD TERMINATION
PAYMENTS"):
(I)
ANY ACCRUED BUT UNPAID BASE SALARY (AS DETERMINED PURSUANT TO
SECTION 3(A)) FOR SERVICES RENDERED TO THE TERMINATION DATE, PAYABLE ON THE NEXT
REGULAR PAYDAY FOLLOWING THE TERMINATION DATE;
6
(II)