SUCH FIRST 60-DAY PERIOD).
AS A CONDITION TO THE CONTINUATION OF
CONSULTING FEE PAYMENTS PURSUANT TO THIS PARAGRAPH, CONSULTANT MUST EXECUTE A
SEPARATION AND GENERAL RELEASE AGREEMENT IN THE FORM ATTACHED HERETO AS EXHIBIT
B (THE "RELEASE"), WHICH MUST BECOME EFFECTIVE WITHIN 55 DAYS FOLLOWING THE DATE
OF TERMINATION; PROVIDED, HOWEVER, THAT IF CONSULTANT'S DATE OF TERMINATION
OCCURS ON OR AFTER NOVEMBER 1 OF A GIVEN CALENDAR YEAR, ANY SUCH PAYMENTS
(SUBJECT TO SECTION 10 HEREOF) SHALL COMMENCE TO BE PAID IN JANUARY OF THE
IMMEDIATELY FOLLOWING CALENDAR YEAR.
"DISABILITY" MEANS THAT, AS A RESULT OF
CONSULTANT'S INCAPACITY DUE TO PHYSICAL OR MENTAL ILLNESS, CONSULTANT HAS BEEN
BEEN SUBSTANTIALLY UNABLE TO PERFORM HIS DUTIES HEREUNDER FOR A CONTINUOUS
PERIOD OF 180 DAYS.
(C)
COMPANY'S TERMINATION OF THE AGREEMENT FOR CAUSE.
IN THE EVENT
THIS AGREEMENT IS TERMINATED BY THE COMPANY FOR CAUSE, CONSULTANT WILL BE
ENTITLED ONLY TO THE PAYMENTS DESCRIBED UNDER SECTION 7(A).
-3-
8.
INDEPENDENT CONTRACTOR.
AS AN INDEPENDENT CONTRACTOR OF THE
COMPANY, CONSULTANT WILL NOT BE ENTITLED TO ANY BENEFITS AVAILABLE TO EMPLOYEES
OF THE COMPANY.
THE COMPANY WILL REPORT PAYMENTS TO CONSULTANT ON AN IRS FORM
1099, AND CONSULTANT ACKNOWLEDGES THAT CONSULTANT WILL BE SOLELY RESPONSIBLE FOR
ANY FEDERAL, STATE OR LOCAL INCOME OR SELF-EMPLOYMENT TAXES ARISING WITH RESPECT
TO ANY FEES HEREUNDER AND THAT CONSULTANT HAS NO STATE LAW WORKERS' COMPENSATION
RIGHTS WITH RESPECT TO SERVICES UNDER THIS AGREEMENT.
AS AN INDEPENDENT
CONTRACTOR, CONSULTANT WILL NOT, DIRECTLY OR INDIRECTLY, ACT AS AN AGENT,
SERVANT OR EMPLOYEE OF THE COMPANY AND WILL NOT HAVE ANY AUTHORITY TO LEGALLY
BIND THE COMPANY OR HOLD HIMSELF OUT AS HAVING SUCH AUTHORITY.
CONSULTANT
AGREES TO OBSERVE ALL POLICIES AND RULES ESTABLISHED BY THE COMPANY FOR ITS
INDEPENDENT CONTRACTORS FROM TIME TO TIME.
9.
409A AND TERMINATION.
NOTWITHSTANDING THE FOREGOING, SOLELY TO
THE EXTENT
NECESSARY TO COMPLY WITH THE RESTRICTION IN SECTION 409A(A)(2)(B) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") CONCERNING PAYMENTS
TO "SPECIFIED EMPLOYEES" (AS DEFINED IN SECTION 409A OF THE CODE AND APPLICABLE
REGULATIONS THEREUNDER, "SECTION 409A") ANY PAYMENT ON ACCOUNT OF CONSULTANT'S
SEPARATION FROM SERVICE THAT WOULD OTHERWISE BE DUE HEREUNDER WITHIN SIX MONTHS
AFTER SUCH SEPARATION SHALL NONETHELESS BE DELAYED UNTIL THE FIRST BUSINESS DAY
OF THE SEVENTH MONTH FOLLOWING CONSULTANT'S DATE OF TERMINATION AND THE FIRST
SUCH PAYMENT SHALL INCLUDE THE CUMULATIVE AMOUNT OF ANY PAYMENTS THAT WOULD HAVE
BEEN PAID PRIOR TO SUCH DATE IF NOT FOR SUCH RESTRICTION, TOGETHER WITH INTEREST
ON SUCH CUMULATIVE AMOUNT DURING THE PERIOD OF SUCH RESTRICTION AT A RATE, PER
ANNUM, EQUAL TO THE APPLICABLE FEDERAL SHORT-TERM RATE (COMPOUNDED MONTHLY) IN
EFFECT UNDER SECTION 1274(D) OF THE CODE ON THE DATE OF TERMINATION.
NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, CONSULTANT SHALL NOT
BE CONSIDERED TO HAVE TERMINATED SERVICES WITH THE COMPANY FOR PURPOSES OF
SECTION 7 HEREOF UNLESS HE WOULD BE CONSIDERED TO HAVE INCURRED A "SEPARATION
FROM SERVICE" FROM THE COMPANY WITHIN THE MEANING OF SECTION 409A.
10.
CONFIDENTIAL INFORMATION, OWNERSHIP