Document:

exhibit10-1.htm

  

  

 

  

Exhibit 10.1

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT, dated as of July 26, 2014, (the “Agreement”), is by and between Acxiom Corporation, a Delaware corporation (the “Company”) and Scott E. Howe (the “Executive”).

 

WHEREAS, the Company desires to continue the employment of the Executive as Chief Executive Officer and President of the Company and the Executive desires to continue to hold such positions under the terms and conditions of this Agreement; and

 

WHEREAS, the parties desire to enter into this Agreement setting forth the terms and conditions of the employment relationship between the Executive and the Company.

 

NOW, THEREFORE, intending to be legally bound hereby, the parties agree as follows:

 

1.           Employment.  The Company hereby continues to employ the Executive and the Executive hereby continues to accept employment with the Company upon the terms and subject to the conditions set forth herein.

 

2.           Term.

 

(a)            Subject to termination pursuant to Section 9, the term of the employment by the Company of the Executive pursuant to this Agreement (as the same may be extended, the “Term”) will commence on July 26, 2014 (the “Effective Date”) and terminate on July 25, 2017.

 

(b)            Commencing on July 26, 2017 and on each subsequent anniversary thereof, the Term will be automatically extended for a period of one (1) additional year following the expiration of the applicable Term unless the Company or the Executive elect not to extend the Term by notifying the other party of such non-renewal in writing not later than one hundred and eighty (180) days before any such date (the “Notice of Non-Renewal”).

 

3.           Position.  During the Term, the Executive will serve as Chief Executive Officer and President of the Company, performing duties commensurate with such positions, and will perform such additional duties as the Board of Directors of the Company (the “Board”) will determine.  The Executive will report directly to the Board.  The Executive agrees to serve, without any additional compensation, as a director of the Company and as a member of the board of directors and/or as an officer of any subsidiary of the Company.  If the Executive’s employment is terminated for any reason, whether such termination is voluntary or involuntary, the Executive will resign as a director of the Company (and as a director and/or officer of any of its subsidiaries), such resignation to be effective no later than the date of termination of the Executive’s employment with the Company.

 

4.           Duties.  During the Term, the Executive will devote his full time and attention during normal business hours to the business and affairs of the Company and its subsidiaries (the “Business”); provided, however, that the Executive will be permitted to devote reasonable periods of time to charitable and community activities, so long as such activities do not interfere with the performance of the Executive’s responsibilities under this Agreement.  In addition, following notice and with the consent of the Board (not to be unreasonably withheld), Executive shall be permitted to serve on the Boards of Directors (or similar governing bodies) of up to three other for-profit entities, only one of which may have publicly traded securities, provided such services do not materially interfere with Executive’s ability to serve as Chief Executive Officer of the Company.  The Company acknowledges and agrees that the Company’s Board of Directors has consented in accordance with this Section 4 to Executive’s service on the Boards of Directors listed on Exhibit A hereto.

 

  

  

  

5.           Salary and Bonus.

 

   (a)            For purposes of this Agreement, the “Initial Fiscal Year” will mean the period commencing on April 1, 2014 and ending on March 31, 2015.  A “Fiscal Year” will mean the Initial Fiscal Year and any other fiscal year of the Company during the Term of the Agreement.

 

(b)           During the Initial Fiscal Year, the Company will pay the Executive a base salary at an annual rate of $650,000.  During the Term of this Agreement, within 90 days following the end of each Fiscal Year, the Board (or the Compensation Committee of the Board (the “Compensation Committee”)) will, in good faith, review the Executive’s annual base salary and may increase (but not decrease) such amount as it may deem advisable (such annual rate of salary, as the same may be increased, the “Base Salary”).  The Base Salary will be payable to the Executive in substantially equal installments in accordance with the Company’s normal payroll practices.

 

(c)           During each Fiscal Year, the Executive will be eligible for a target cash bonus opportunity of 100% of then-current Base Salary and a maximum cash bonus opportunity of 200% of then-current Base Salary.  The Executive’s entitlement to such cash bonus, if any, will be determined promptly by the independent members of the Board (or by the Compensation Committee) based on the terms of the executive bonus program then in effect, including the Board’s (or the Compensation Committee’s) good faith determination as to whether pre-determined performance targets of the Company have been achieved following a review of the Company’s year-end audited financial statements.  All such performance targets will be determined by the independent members of the Board (or by the Compensation Committee) after consulting with Executive.  Payments will be made in accordance with the terms of the relevant plan, or, if different, in accordance with the terms of this Agreement.

 

(d)           Promptly following the date hereof, the Company will reimburse the Executive for reasonable legal expenses up to an amount of $25,000 incurred by him in connection with the drafting and negotiation of this Agreement.

 

6.           Long-Term Incentive Awards.

 

(a)           During the Term of this Agreement, within 90 days following the end of each Fiscal Year, the independent members of the Board of Directors (or the Compensation Committee) will in good faith consider the grant of long-term equity incentive awards to the Executive.

 

(b)           Notwithstanding any provision to the contrary in any equity incentive plan or related award agreement relating to any equity incentive award granted to the Executive, solely with respect to the Executive (i) any definition of competitive business activities (including “any activity which competes with any activity of the Company and/or its subsidiaries and affiliated companies” or acting “in competition with or acting against the interests of the Company”) shall be deemed to be the activities that would result in a violation of Section 12(b) hereof, (ii) the activities that would be deemed to constitute “disclosing or misusing any confidential information or

 

  

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 material concerning the Company” shall be deemed to be the activities that would result in a violation of Section 7 of the Acxiom Corporation Associate Agreement; (iii) the activities that would be deemed to constitute “any attempt, directly or indirectly, to solicit the trade or business of any current or prospective customer of the Company” shall be deemed to be the activities that would result in a violation of Section 12(a)(i) hereof, (iv) the activities that would be deemed to constitute “any attempt, directly or indirectly, to induce any associate of the Company to be employed or perform services elsewhere” shall be deemed to be the activities that would result in a violation of Section 12(a)(ii) hereof; and (v) any forfeiture provisions contained therein requiring the payment of proceeds of equity gains to the Company shall refer solely to the amount of after-tax proceeds actually received by the Executive.  In determining after-tax proceeds in clause (v) of this Section 6(d), any tax deduction or loss arising from such forfeiture will be taken into account.

 

(c)           The parties intend that any equity incentive awards contemplated by this Section 6 and the payments and benefits provided thereunder be exempt from or comply with the requirements of Section 409A of the Code to the maximum extent possible, whether pursuant to the short-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4), the exclusion applicable to stock options under Treasury Regulation Section 1.409A-1(b)(5), or otherwise.  Notwithstanding any other provision of this Agreement or any other plan or agreement to the contrary, all equity incentive awards contemplated by this Section 6 shall be interpreted, operated, and administered in a manner consistent with such intentions.

 

7.          Vacation, Holidays and Sick Leave; Life Insurance.  During the Term, the Executive will be entitled to paid vacation in accordance with the Company’s standard vacation accrual policies for its senior executive officers as may be in effect from time to time; provided, that the Executive will during each Fiscal Year be entitled to at least four (4) weeks of such vacation.  During the Term, the Executive will also be entitled to participate in all applicable Company employee benefits plans as may be in effect from time to time for the Company’s senior executive officers.

 

8.          Business Expenses.  The Executive will be reimbursed for all reasonable business expenses incurred by him in connection with his employment following timely submission by the Executive of receipts and other documentation in accordance with the Company’s normal expense reimbursement policies.

 

9.          Termination of Employment.  The Executive’s employment by the Company pursuant to this Agreement will not be terminated before the end of the Term hereof, except as set forth in this Section 9.

 

(a)            By Mutual Consent.  The Executive’s employment pursuant to this Agreement may be terminated at any time by the mutual written agreement of the Company and the Executive.

 

(b)            Death.  The Executive’s employment pursuant to this Agreement will be terminated upon the death of the Executive, in which event the Executive’s spouse or heirs will receive (i) all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination (as defined in Section 9(j) hereof), (ii) any other unpaid benefits (including death benefits) to which they are entitled under any plan, policy

 

  

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or program of the Company applicable to the Executive as of the Date of Termination, (iii) in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated, and (iv) the amount of any target cash bonus for the Fiscal Year in which the Date of Termination occurs, pro-rated based on the portion of the applicable Fiscal Year that the Executive worked for the Company.  The amounts referred to in clauses (i) through (iii) above will be paid to the Executive when the same would have been paid to the Executive (whether or not the Term will have expired during such period), and the amount referred to in clause (iv) will be paid to the Executive within sixty (60) days following the Date of Termination.

 

(c)            Disability.  The Executive’s employment pursuant to this Agreement may be terminated by delivery of written notice to the Executive by the Company (a “Notice of Termination”) in the event that the Executive is unable to perform the essential functions of his regular duties and responsibilities, with or without reasonable accommodation, due to a Disability that has lasted (or can reasonably be expected to last) for a period of ninety (90) consecutive days, or for a total of ninety (90) days or more in any consecutive one hundred and eighty (180) day period.  “Disability” means a physical or mental impairment of Executive as certified in a written statement from a licensed physician selected or approved in good faith by the Board (or any committee of the Board comprised solely of independent directors).  If the Executive’s employment is terminated pursuant to this Section 9(c), the Executive will be entitled to receive (i) all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, (ii) any other unpaid benefits (including disability benefits) to which he is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination, (iii) in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated, and (iv) the amount of any target cash bonus for the Fiscal Year in which the Date of Termination occurs, pro-rated based on the portion of the applicable Fiscal Year that the Executive worked for the Company.  The amounts referred to in clauses (i) through (iii) above will be paid to the Executive when the same would have been paid to the Executive (whether or not the Term will have expired during such period), and the amount referred to in clause (iv) will be paid to the Executive within sixty (60) days following the Date of Termination.

 

(d)            By the Company for Cause.  The Executive’s employment pursuant to this Agreement may be terminated by delivery of a Notice of Termination upon the occurrence of any of the following events (each of which will constitute “Cause” for termination):  (i) the willful failure by the Executive to substantially perform his duties or follow the reasonable and lawful instructions of the Board; provided, that the Executive will be allowed to cure such failure within thirty (30) days of delivery to the Executive by the Company of written demand for performance, which such written demand will specifically identify the manner in which the Company believes he has not substantially performed his duties;  (ii) the engaging by the Executive in intentional misconduct, or the Executive’s gross negligence, that is materially injurious to the Company, monetarily or otherwise; (iii) the conviction of, or pleading guilty or nolo contendere to, any felony; or (iv) the Executive’s material breach of the provisions of this Agreement (including, but not limited to, Section 12) or of any material employment policy of the Company, which, if

 

  

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curable, is not cured within thirty (30) days of delivery to the Executive by the Company of written notice thereof, which such notice shall specify in reasonable detail the manner in which the Company believes the Executive has breached this Agreement.  If the Executive’s employment is terminated pursuant to this Section 9(d), the Executive will be entitled to receive all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, any other unpaid benefits to which he is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination and no more.

 

(e)            By the Company Without Cause.  The Executive’s employment pursuant to this Agreement may be terminated by the Company at any time without Cause by delivery of a Notice of Termination.  If the Executive’s employment is terminated pursuant to this Section 9(e), the Executive will be entitled to receive (i) all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, (ii) in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated, (iii) a bonus payment based on the extent to which the performance goals relating to such bonus are ultimately achieved, pro-rated based on the portion of the Fiscal Year that the Executive worked for the Company, and payable on the date when such bonus otherwise would have been paid absent termination of employment, (iv) an amount equal to two hundred percent (200%) of the sum of (A) the Executive’s Base Salary at the then-current rate of Base Salary plus (B) his average annual cash bonus for the two Fiscal Years preceding the Fiscal Year or termination, and (v) any other unpaid benefits to which the Executive is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination.  The amounts referred to in clauses (i), (ii) and (iv) above will be paid to the Executive immediately following the expiration of the Severance Delay Period, in accordance with the Company’s normal payroll policies and procedures.  Additionally, if the Executive’s employment is terminated pursuant to this Section 9(e), notwithstanding anything contained in any equity plan or grant documents, the Executive shall also receive solely with respect to Performance Units:  (i) the number of Performance Units, if any, that were earned during a completed performance period but remain unvested, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Date of Termination and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture, payment for which shall be processed immediately following the expiration of the Severance Delay Period; and (ii) the number of Performance Units, if any, for performance periods that are ongoing as of the Date of Termination and for which at least one year of the performance period has elapsed as of the Date of Termination, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Date of Termination and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture, with the settlement of such performance units to occur after the completion of the applicable performance period based upon the Company’s actual performance as determined following the completion of the applicable performance periods in accordance with the terms of the Performance Unit grant documents and with payment to be made as soon as administratively practicable after the end of the performance period stated in the

 

  

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applicable grant documents and at the time the Executive would have received payment had the Executive remained employed.  “Performance Unit” shall mean any equity incentive awards (including, for the avoidance of doubt, performance stock appreciation rights) granted by the Company to the Executive that are earned based upon achievement of performance measures during a performance period as defined by the accompanying grant documents.  As a condition to receiving such payments, the Executive agrees to execute, deliver and not revoke a general release in the form attached as Exhibit B prior to the expiration of the Severance Delay Period.  “Severance Delay Period” shall mean the period beginning on the Date of Termination and ending on the thirtieth day thereafter.  Notwithstanding the foregoing, in the event that the Executive’s “separation from service” (as such term is defined under Treasury Regulation 1.409A-1(h)) occurs in connection with an exit incentive program or other employment termination program offered to a group or class of employees, as defined under the Older Worker Benefit Protection Act, 29 U.S.C. Section 626, the Severance Delay Period shall mean the period beginning on the Date of Termination and ending on the sixtieth day thereafter.

 

(f)            By the Executive for Good Reason.  The Executive’s employment pursuant to this Agreement may be terminated by the Executive by written notice of his resignation (“Notice of Resignation”) delivered to the Company within thirty (30) days of the occurrence of any of the following (each of which will constitute “Good Reason” for resignation):  (1) a material reduction by the Company in the Executive’s title or position, or a material reduction by the Company in the Executive’s authority, duties or responsibilities (including, without limitation, Executive no longer serving on the Company’s board of directors or if he is not the Chief Executive Officer of the Company’s ultimate parent entity following a Change in Control), or the assignment by the Company to the Executive of any duties or responsibilities that are materially inconsistent with such title, position, authority, duties or responsibilities, (2) a reduction in Base Salary; or (3) any material breach of this Agreement by the Company (collectively, a “Good Reason Event”); provided, that, if any Good Reason Event is curable, the Company will be allowed to cure such Good Reason Event within thirty (30) days of delivery to the Company by the Executive of his Notice of Resignation, which such Notice of Resignation will specifically identify the Good Reason Event which the Executive believes has occurred.  For avoidance of doubt, “Good Reason” will exclude the death or Disability of the Executive.  If the Company fails to cure the Good Reason Event within the thirty (30) day cure period, then the Executive must terminate employment within thirty (30) days thereafter.  If the Executive does not terminate employment during such thirty (30) day period, then the Executive will be deemed to have waived his right to terminate employment based upon such Good Reason Event and will not receive any payments under this Section 9(f).  If the Executive resigns for Good Reason pursuant to this Section 9(f), the Executive will be entitled to receive (i) all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, (ii) in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated, (iii) a bonus payment based on the extent to which the performance goals relating to such bonus are ultimately achieved, pro-rated based on the portion of the Fiscal Year that the Executive worked for the Company, and payable on the date when such bonus otherwise would have been paid absent termination of employment, (iv) an amount equal to two hundred percent (200%) of the sum of (A) the Executive’s Base Salary at the then-current rate of Base Salary plus (B) his average annual cash bonus for the two Fiscal Years preceding the Fiscal Year or termination, and (v) any other unpaid benefits to which the Executive is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination.  The amounts referred to in clauses (i), (ii) and (iv) above will be paid to the Executive immediately following the expiration of the Severance Delay Period in

 

  

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accordance with the Company’s normal payroll policies and procedures.  Additionally, if the Executive resigns for Good Reason pursuant to this Section 9(f), notwithstanding anything contained in any equity plan or grant documents, the Executive shall also receive solely with respect to Performance Units:  (x) the number of Performance Units, if any, that were earned during a completed performance period but remain unvested, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Date of Termination and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture, payment for which shall be processed immediately following the expiration of the Severance Delay Period; and (y) the number of Performance Units, if any, for performance periods that are ongoing as of the Date of Termination and for which at least one year of the performance period has elapsed as of the Date of Termination, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Date of Termination and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture, with the settlement of such performance units to occur after the completion of the applicable performance period based upon the Company’s actual performance as determined following the completion of the applicable performance periods in accordance with the terms of the Performance Unit grant documents and with payment to be made as soon as administratively practicable after the end of the performance period stated in the applicable grant documents and at the time the Executive would have received payment had the Executive remained employed.  As a condition to receiving such payments, the Executive agrees to execute, deliver and not revoke a general release in the form attached as Exhibit B prior to the expiration of the Severance Delay Period.  Notwithstanding the foregoing, in the event that the Executive’s “separation from service” (as such term is defined under Treasury Regulation 1.409A-1(h)) occurs in connection with an exit incentive program or other employment termination program offered to a group or class of employees, as defined under the Older Worker Benefit Protection Act, 29 U.S.C. Section 626, the Severance Delay Period shall mean the period beginning on the Date of Termination and ending on the sixtieth day thereafter.

 

(g)           Non-Renewal by the Company.  The Executive’s employment may be involuntarily terminated at the end of the Term by the Company by delivery of a Notice of Non-Renewal consistent with the provisions of Sections 2(b) and 18.  If the Executive’s employment is involuntarily terminated as described in the preceding sentence, this shall be treated as a termination by the Company without Cause, and the provisions of Section 9(e) shall apply.

 

(h)           By the Executive Without Good Reason.  The Executive’s employment pursuant to this Agreement may be terminated by the Executive at any time by delivery of a Notice of Resignation to the Company.  If the Executive’s employment is terminated pursuant to this Section 9(h), the Executive will receive all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, any other unpaid benefits to which the Executive is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination (including, without limitation, in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated) and no more.

 

  

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(i)           Following a Change in Control.

 

(i)           If within twenty-four (24) months following a Change in Control, the Executive is (x) terminated without Cause by delivery of a Notice of Termination, or (y) resigns for Good Reason (as defined and qualified in Section 9(f) above) by delivery of a Notice of Resignation, then the Executive will be entitled to receive (i) all Base Salary and benefits to be paid or provided to the Executive under this Agreement through the Date of Termination, (ii) in the event the Date of Termination occurs after the completion of any Fiscal Year, but prior to the date any cash bonus related to such Fiscal Year has been determined or paid to the Executive, the amount of any cash bonus related to such Fiscal Year ending before the Date of Termination that the Executive would have otherwise been entitled to had Executive not terminated, (iii) a bonus payment based on the extent to which the performance goals relating to such bonus are ultimately achieved, pro-rated based on the portion of the Fiscal Year that the Executive worked for the Company, and payable on the date when such bonus otherwise would have been paid absent termination of employment, (iv) an amount equal to three hundred percent (300%) of the sum of (A) Executive’s Base Salary at the then-current rate of Base Salary plus (B) his average annual cash bonus for the two Fiscal Years preceding the Fiscal Year or termination, (v) notwithstanding anything to the contrary in any equity incentive plan or agreement or the related award agreements, all options, restricted stock awards, restricted stock unit awards and any other equity awards (other than any Performance Units), which are then outstanding, to the extent not then vested, shall vest, and (vi) any other unpaid benefits to which the Executive is otherwise entitled under any plan, policy or program of the Company applicable to the Executive as of the Date of Termination.  The amounts referred to in clauses (i) through (vi) above will collectively be referred to as the “Change in Control Severance Amount.”  The Change in Control Severance Amounts described in clauses (i), (ii) and (iv) will be paid to the Executive in a lump sum immediately following the expiration of the Severance Delay Period.  The Executive agrees to execute, deliver and not revoke a general release in the form attached as Exhibit B prior to the expiration of the Severance Delay Period.  Payments pursuant to this Section 9(i) will be made in lieu of, and not in addition to, any payment pursuant to any other paragraph of this Section 9.

 

(ii)           Upon the consummation of a Change in Control, whether or not the Executive’s employment is terminated, the Executive shall earn and become 100% vested in a prorated portion of any Performance Units for performance periods that are ongoing as of the Change in Control and for which at least one year of the performance period has elapsed as of the Change in Control as calculated pursuant to the following sentence, notwithstanding anything contrary in any equity incentive plan or agreement, including without limitation, the plan document or the related award agreements and grant documents.  The amount of the prorated Performance Units will be determined in accordance with the terms of the Performance Unit grant documents based upon the Company’s performance as of the date of the Change in Control as if the performance period had been completed, and then multiplied by a fraction, the numerator of which is the full number of calendar months that have elapsed since the beginning of the performance period and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture.  Additionally, in the event of a Change in Control, whether or not the Executive’s employment is terminated, the Executive shall become 100% vested in a prorated portion of Performance Units that were earned during a completed performance period but remain unvested as calculated pursuant to the following sentence,

 

  

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notwithstanding anything to the contrary in any equity incentive plan or agreement, including without limitation, the plan document or the related award agreements and grant documents.  The amount of prorated Performance Units will be determined based upon the number of Performance Units, if any, that were earned during the completed performance period but remain unvested, and then multiplied by a fraction, the numerator of which is the full number of calendar months that have elapsed since the beginning of the performance period and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture.

 

(iii)           In the event Executive is terminated without Cause, or resigns for Good Reason, following the public announcement of a Board-approved agreement to effect a Change in Control but prior to the consummation of such Change in Control, then in addition to those payments made pursuant to Sections 9(e) or (f), as applicable, Executive shall be entitled to certain additional payments pursuant to this Section 9(i)(iii) in the event such publicly announced Change in Control is consummated (or if such publicly announced Change in Control is terminated by the Board to accept a superior proposal, if such superior proposal constituting a Change in Control is consummated).  In such case, (i) the Executive shall be entitled to receive an amount equal to one hundred percent 100% of the sum of (A) the Executive’s Base Salary at the rate of Base Salary in effect on the Executive’s Date of Termination plus (B) his average annual cash bonus for the two Fiscal Years preceding the Fiscal Year or termination; (ii) with respect to any unvested equity awards (other than Performance Units) that Executive forfeited upon his termination of employment (without receiving payment therefor) but that would have vested on or prior to Executive’s termination with Good Reason following a Change in Control had Executive remained employed with the Company until the Change in Control (such equity, “Unvested Equity”), Executive shall be entitled to receive a payment in an amount equal to the value of such Unvested Equity, calculated with reference to the value of the Company’s common stock implied by the Change in Control price of such stock; and (iii) with respect to any Performance Units held by Executive at the Date of Termination (and not previously forfeited), a payment in an amount equal to the difference between the amount that would have been paid on account of such Performance Units pursuant to Section 9(i)(ii) had Executive remained employed with the Company until the date of a Change in Control and the amount that has actually been paid on account of such Performance Units as of the date of the Change in Control pursuant to Section 9(e) or 9(f), as applicable.  The additional payments set forth in subsections (i) to (iii) of this Section 9(i)(iii) shall be paid in a lump sum on the later of (x) the expiration of the original Severance Delay Period applicable to Executive’s actual termination, or (y) contemporaneously with the closing of the Change in Control (or as soon as administratively practicable thereafter).  For the avoidance of doubt, a payment shall be made under this Section 9(i)(iii) only as a result of a Change in Control described in Section 9(k)(iii) and shall not include a “Non-Qualifying Transaction.”

 

(j)           Date of Termination.  The Executive’s Date of Termination will be (i) if the Executive’s employment is terminated pursuant to Section 9(b), the date of his death, (ii) if the Executive’s employment is terminated pursuant to Section 9(c), Section 9(d) or Section 9(e), the date on which a Notice of Termination is given, (iii) if the Executive’s employment is terminated pursuant to Section 9(f), the later of the date specified in the Notice of Resignation or the date on which Executive actually terminates employment following the expiration of the cure period set forth in Section 9(f), or such earlier date as the Company shall determine, (iv) if the Executive’s employment

 

  

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is terminated pursuant to Section 9(g), the date that is the last day of the then-current Term, (v) if the Executive’s employment is terminated pursuant to Section 9(h), the date specified in the Notice of Resignation or such earlier date as the Company shall determine (provided that the Executive will deliver such Notice of Resignation to the Company not less than thirty (30) days before the Date of Termination specified therein) and (vi) if the Executive’s employment is terminated pursuant to Section 9(i), the date specified in the Notice of Termination or the Notice of Resignation, as applicable, or such earlier date as the Company shall determine.

 

(k)           For the purposes of this Agreement, a “Change in Control” will mean any of the following events:

 

(i)           An acquisition of any securities of the Company entitled to vote generally in the election of directors (the “Voting Securities”) by any “person” (as the term person is used for purposes of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) immediately after which such person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of thirty percent (30%) or more of the combined voting power of the then outstanding Voting Securities; provided, however, that in determining whether a Change in Control has occurred, Voting Securities that are acquired in a “Non-Control Acquisition” (as hereinafter defined) will not constitute an acquisition that would cause a Change in Control.  A “Non-Control Acquisition” will mean (i) an acquisition by an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any corporation or other person of which a majority of its voting power or its equity securities or equity interest is owned directly or indirectly by the Company (a “Subsidiary”), (ii) any acquisition by or directly from the Company or any Subsidiary, or (iii) an acquisition pursuant to a Non-Qualifying Transaction (as defined in Section 9(j)(iii) below);

 

(ii)           The individuals who, on the Effective Date, constitute the Board of Directors of the Company (the “Incumbent Directors”) cease for any reason to constitute at least a majority of such board, provided, that, any person becoming a director after the Effective Date and whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board of Directors will be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to the election or removal of directors (“Election Contest”) or other actual or threatened solicitation of proxies or consents by or on behalf of any “person” (such term for purposes of this definition being as defined in Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) and 14(d)(2) of the 1934 Act) other than the Board of Directors (“Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest, will be deemed an Incumbent Director; or

 

(iii)           Consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company (a “Reorganization”), or the sale or other disposition of all or substantially all of the Company’s assets (a “Sale”) or the acquisition of assets or stock of another corporation (an “Acquisition”), unless immediately following such Reorganization, Sale or Acquisition:

 

(A)            The stockholders of the Company immediately before such Reorganization, Sale or Acquisition, beneficially own, directly or indirectly, immediately following such Reorganization, Sale or Acquisition, more than fifty percent (50%) of the combined voting power of the outstanding Voting Securities of the Company resulting from such Reorganization, Sale or Acquisition (including, without limitation, a corporation

 

  

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which as a result of such transaction owns the Company or all or substantially all of the Company’s assets or stock either directly or through one or more subsidiaries, the “Surviving Corporation”) in substantially the same proportion as their ownership of the Voting Securities immediately before such Reorganization, Sale or Acquisition;

 

(B)            The individuals who were members of the Incumbent Board immediately before the execution of the agreement providing for such Reorganization, Sale or Acquisition constitute at least a majority of the members of the board of directors of the Surviving Corporation; and

 

(C)            No person (other than the Company, any Subsidiary, any employee benefit plan (or any trust forming a part thereof) maintained by the Company, the Surviving Corporation or any Subsidiary, or any person who, immediately before such Reorganization, Sale or Acquisition, had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Voting Securities), has Beneficial Ownership of thirty percent (30%) or more of the combined voting power of the Surviving Corporation’s then outstanding Voting Securities;

 

Any Reorganization, Sale or Acquisition which satisfies all of the criteria specified in subparts (A), (B) and (C) of this Section 9(j) above will be deemed to be a “Non-Qualifying Transaction.”

 

Notwithstanding the foregoing, a “Change in Control” will not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities of the Company as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities outstanding, increased the proportional number of shares Beneficially Owned by the Subject Person.

 

(iv)           Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

Notwithstanding the foregoing, to the extent that (i) any payment under this Agreement is payable solely upon or following the occurrence of a Change in Control and (ii) such payment is treated as “deferred compensation” for purposes of Section 409A of the Code, a Change in Control shall mean a “change in the ownership of the Company,” a “change in the effective control of the Company,” or a “change in the ownership of a substantial portion of the assets of the Company” as such terms are defined in Section 1.409A-3(i)(5) of the Treasury Regulations.

 

(1)           Delay of Payment Required by Section 409A of the Code.  It is intended that (i) each payment or installment of payments provided under this Agreement will be a separate “payment” for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) that the payments will satisfy, to the greatest extent possible, the exemptions from the application of Section 409A of the Code, including those provided under Treasury Regulations 1.409A-1(b)(4) (regarding short-term deferrals), 1.409A-1(b)(9)(iii) (regarding the two-times, two-year exception), and 1.409A-1(b)(9)(v) (regarding reimbursements and other separation pay).  Notwithstanding anything to the contrary in this Agreement, if (i) on the date the Executive’s employment with the Company terminates or at such other time that is relevant under Section 409A of the Code, the Company determines that the Executive is a “specified employee” (as such term is defined under Treasury Regulation 1.409A-1(i)(1)) of the Company and (ii) the Company determines that any payments to be provided to the Executive

 

  

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pursuant to this Agreement are or may become subject to the additional tax under Section 409A(a)(1)(B) of the Code or any other taxes or penalties imposed under Section 409A of the Code if provided at the time otherwise required under this Agreement, then such payments will be delayed until the date that is six (6) months after the date of the Executive’s “separation from service” (as such term is defined under Treasury Regulation 1.409A-1(h)) with the Company or, if earlier, the date of the Executive’s death.  Any payments delayed pursuant to this Section 9(1) will be made in a lump sum on the first day of the seventh month following the Executive’s “separation from service” (as such term is defined under Treasury Regulation 1.409A-1(h)) or, if earlier, the date of the Executive’s death and any remaining payments required to be made under this Agreement will be paid upon the schedule otherwise applicable to such payments under the Agreement.

 

10.          Representations.

 

(a)           The Company represents and warrants that this Agreement has been authorized by all necessary corporate action of the Company and is a valid and binding agreement of the Company enforceable against it in accordance with its terms.

 

(b)           The Executive represents and warrants that he is not a party to any agreement or instrument which would prevent him from entering into or performing his duties in any way under this Agreement.

 

11.          Assignment; Binding Agreement.  This Agreement is a personal contract and the rights and interests of the Executive hereunder may not be sold, transferred, assigned, pledged, encumbered, or hypothecated by him, except as otherwise expressly permitted by the provisions of this Agreement.  This Agreement will inure to the benefit of and be enforceable by the Executive and his personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees arid legatees.  If the Executive should die while any amount would still be payable to him hereunder had the Executive continued to live, all such amounts, unless otherwise provided herein, will be paid in accordance with the terms of this Agreement to his devisee, legatee or other designee or, if there is no such designee, to his estate.

 

12.          Confidentiality; Non-Solicitation; Non-Competition.

 

(a)         Non-Solicitation.

 

(i)           The Executive specifically acknowledges that the Confidential Information described in this Section 12 includes confidential data pertaining to current and prospective customers of the Company, that such data is a valuable and unique asset of the Company’s business and that the success or failure of the Company’s specialized business is dependent in large part upon the Company’s ability to establish and maintain close and continuing personal contacts and working relationships with such customers, and to develop proposals which are specifically designed to meet the requirements of such customers.  Therefore, the Executive agrees that during the Term of this Agreement, and for a period of one (1) year after the Date of Termination, he will not, except on behalf of the Company or with the Company’s express written consent, solicit, either directly or indirectly, on his own behalf or on behalf of any other person or entity, any customers or targeted potential customers with whom he had contact before the Date of Termination to take any action which could reasonably be expected to adversely affect the Company.

 

  

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(ii)           The Executive specifically acknowledges that the Confidential Information described in this Section 12 also includes confidential data pertaining to current and prospective employees and agents of the Company, and the Executive further agrees that during the Term of this Agreement, and for a period of one (1) year after the Date of Termination, the Executive will not directly or indirectly solicit, induce or attempt to induce, on his own behalf or on behalf of any other person or entity, the services of any person who is an employee of the Company or solicit any of the Company’s employees, consultants or agents to terminate their employment or agency with the Company or take any other actions which would otherwise cause the Company’s employees, consultants or agents to violate any Company policy, program or plan.

 

(iii)           The Executive specifically acknowledges that the Confidential Information described in this Section 12 also includes confidential data pertaining to current and prospective vendors and suppliers of the Company, and the Executive agrees that during the Term of this Agreement, and for a period of one (1) year after the Date of Termination, the Executive will not directly or indirectly solicit, on his own behalf or on behalf of any other person or entity, any vendor or supplier of the Company for the purpose of terminating or changing (in an adverse manner) such vendor’s or supplier’s relationship or agency with the Company.

 

(iv)           For purposes of this Section 12(a), references to the Company mean the Company or any existing or future subsidiary of the Company and any other entities that directly or indirectly, through one or more intermediaries, control, are controlled by or are under common control with the Company.

 

(b)           Non-Competition.  The Executive covenants and agrees that during the Term of this Agreement, and for a period of one (1) year after the Date of Termination, he will not engage in or carry on, directly or indirectly, as an individual, principal, owner, employee, agent, associate, consultant, director or in any other capacity, a business competitive with that conducted by the Company at the Date of Termination (including any businesses in active development by the Company as of the Date of Termination).  To “engage in or carry on” will mean to have ownership in such business (excluding ownership of up to $250,000 of the outstanding shares of a publicly-traded company) or to consult, work in, direct or have responsibility for any area of such business, including but not limited to the following areas:  operations, technology strategy, sales, marketing, product planning, research, design or development.

 

(c)           The parties intend that each of the covenants contained in this Section 12 will be construed as a series of separate covenants, one for each state of the United States, each county of each state of the United States, and each foreign jurisdiction in which the Company does business or is preparing to do business.  Except for geographic coverage, each such separate covenant will be deemed identical in terms to the covenant contained in the preceding subsections of this Section 12.  If, in any judicial proceeding, a court will refuse to enforce any of the separate covenants (or any part thereof) deemed included in those subsections, then such unenforceable covenant (or such part) will be deemed eliminated from this Agreement for the purpose of those proceedings to the extent necessary to permit the remaining separate covenants (or portions thereof) to be enforced.  In the event that the provisions of this Section 12 should ever be deemed to exceed the time or geographic limitations, or the scope of this covenant is ever deemed to exceed that which is permitted by applicable law, then such

 

  

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provisions will be reformed to the maximum time, geographic limitations or scope, as the case may be, permitted by applicable law.  The unenforceability of any covenant in this Section 12 will not preclude the enforcement of any other of said covenants or provisions of any other obligation of the Executive or the Company hereunder, and the existence of any claim or cause of action by the Executive or the Company against the other, whether predicated on the Agreement or otherwise, will not constitute a defense to the enforcement by the Company of any of said covenants.

 

13.          Ownership of Developments; Trade Secrets of Others.  All copyrights, patents, trade secrets, or other intellectual property rights associated with any idea, concepts, techniques, inventions, processes, or works of authorship developed or created by the Executive during the course of his work for the Company or its clients, including with respect to the services to be provided hereunder (collectively, the “Work Product”), will belong exclusively to the Company and will, to the extent possible, be considered a work made by the Executive for hire for the Company within the meaning of Title 17 of the United States Code.  To the extent the Work Product may not be considered work made by the Executive for hire for the Company, the Executive agrees to assign, and automatically assign at the time of creation of the Work Product, without any requirement of further consideration, any right, title, or interest the Executive may have in such Work Product.  Upon the request of the Company, the Executive will take further actions, including execution and delivery of instruments of conveyance, as may be appropriate to give full and proper effect to such assignment.  The Executive represents that he is not bound by, and covenants that he will not enter into, any agreements, either written or oral, which are in conflict with this Agreement.  For purposes of this Section 13, the references to the Company mean the Company or any existing or future subsidiary of the Company and any other entities that directly or indirectly, through one or more intermediaries, control, are controlled by or are under common control with the Company.

 

14.          Company Remedies. The Executive acknowledges and agrees that the restrictions and covenants contained in this Agreement are reasonable and necessary to protect the legitimate interests of the Company and that the services to be rendered by him hereunder are of a special, unique and extraordinary character.  To that end, in the event of any breach by the Executive of Section 12 or Section 13 hereof, the Executive agrees that the Company would be entitled to injunctive relief, which entails that (i) it would be difficult to replace the Executive’s services; (ii) the Company would suffer irreparable harm that would not be adequately compensated by monetary damages and (iii) the remedy at law for any breach of any of the provisions of Section 12 or Section 13 may be inadequate.  The Executive further acknowledges that legal counsel of his choosing has reviewed this Agreement, that the Executive has consulted with such counsel, and that he agrees to the terms herein without reservation.  Accordingly, the Executive specifically agrees that the Company will be entitled, in addition to any remedy at law or in equity, and to the extent consistent with Section 409A of the Code, to (i) retain any and all payments not yet paid to him under this Agreement in the event of any material breach by him of his covenants under Sections 12 and 13 hereunder, (ii) in the event of such material breach, seek monetary damages and (iii) obtain preliminary and permanent injunctive relief and specific performance for any actual or threatened violation of Section 12 or Section 13 of this Agreement.  This provision with respect to injunctive relief will not, however, diminish the right to claim and recover damages, or to seek and obtain any other relief available to it at law or in equity, in addition to injunctive relief.

 

  

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15.          Parachute Payments. Any provision of the Agreement to the contrary notwithstanding, if any payments or benefits the Executive would receive from the Company pursuant to the Agreement or otherwise (collectively, the “Payments”) would, either separately or in the aggregate, (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Payments will be equal to the Reduced Amount (defined below), The “Reduced Amount” will be either (1) an amount equal to the largest portion of the Payments that would result in no portion of any of the Payments (after reduction) being subject to the Excise Tax or (2) the entire amount of the Payments, whichever amount after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes), results in the Executive’s receipt, on an after-tax basis, of the greatest amount of the Payments.  If a reduction in the Payments is to be made so that the amount of the Payments equals the Reduced Amount, (x) the Payments will be paid only to the extent permitted under the Reduced Amount alternative, and the Executive will have no rights to additional payments and/or benefits constituting the Payments, and (y) reduction in payments and/or benefits will occur in the following order and in a manner intended to comply with Section 409A of the Code (as determined by the Company):  (1) reduction or elimination of cash severance benefits that are subject to Section 409A of the Code; (2) reduction or elimination of cash severance benefits that are not subject to Section 409A of the Code; (3) cancellation or elimination of accelerated vesting of equity awards (other than stock options); (4) cancellation of accelerated vesting of stock options; (5) reduction or elimination of any remaining Payments that are subject to Section 409A of the Code; and (6) reduction or elimination of any remaining Payments that are not subject to Section 409A of the Code.  In the event that acceleration of vesting of equity award compensation is to be reduced or eliminated, such acceleration of vesting will be cancelled in the reverse order of the date of grant of the Executive’s equity awards.  In no event will the Company or any stockholder be liable to the Executive for any amounts not paid as a result of the operation of this Section 15.  All computations and determinations called for by this Section 15 shall be made by tax counsel or a nationally recognized accounting firm appointed by the Company (the “Tax Advisor”).  If the Tax Advisor so engaged by the Company is serving as accountant or auditor for the acquirer, the Company will appoint another Tax Advisor to make the determinations required hereunder.  The Company will bear all expenses with respect to the determinations by the Tax Advisor required to be made hereunder.  The Tax Advisor engaged to make the determinations hereunder will provide its preliminary calculations, together with detailed supporting documentation, to the Company and the Executive within fifteen (15) days before the consummation of the Change in Control (if requested at that time by the Company or the Executive) or such other reasonable time as requested by the Company or the Executive.  No portion of the Payments shall be taken into account which in the opinion of the Tax Advisor does not constitute a “parachute payment” within the meaning of Code Section 280G(b)(2), including by reason of Code Section 280G(b)(4)(A).  The Executive shall have the right to review and submit such calculation and supporting documentation to his own tax consultant for review.  If the Executive’s tax consultant disagrees with such calculations and such objection is submitted to the Tax Advisor in writing in reasonable detail within five (5) business days of the provision of the preliminary calculation, the Tax Advisor shall be obligated to consider any issues raised by the Executive’s tax consultant in good faith before making any final determination hereunder.  Any good faith determinations of the Tax Advisor made hereunder will be final, binding and conclusive upon the Company and the Executive.

 

  

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16.          Entire Agreement.  This Agreement and the equity incentive plans and agreements referenced herein contain all the understandings between the parties hereto pertaining to the matters referred to herein, and supersede any other undertakings and agreements, whether oral or in writing, previously entered into by them with respect thereto, including the employment agreement between the parties effective July 26, 2011.  To the extent that any term or provision of any other document or agreement executed by the Executive with or for the Company during the Term of this Agreement, including, without limitation, Sections 4, 8, 9, 10 and 12 of the Acxiom Corporation Associate Agreement, conflicts or is inconsistent with this Agreement, the terms and conditions of this Agreement shall prevail and supersede such inconsistent or conflicting term or provision, except to the extent, if any, expressly provided otherwise in such other document or agreement with specific reference to this Agreement (it being understood that the Executive’s obligations under Sections 4, 9, and 10 of the Acxiom Corporation Associate Agreement are superseded in whole by the Executive’s obligations under this Agreement).  The Executive represents that, in executing this Agreement, he does not rely and has not relied upon any representation or statement not set forth herein made by the Company with regard to the subject matter or effect of this Agreement or otherwise and that the Executive has been represented by counsel selected by the Executive.

 

17.          Amendment, Modification or Waiver.  No provision of this Agreement may be amended or waived, unless such amendment or waiver is agreed to in writing, signed by the Executive and by a duly authorized officer of the Company.  No waiver by any party hereto of any breach by another party hereto of any condition Or provision of this Agreement to be performed by such other party will be deemed a waiver of a similar or dissimilar condition or provision at the same time, any prior time or any subsequent time.

 

18.          Notices. Any notice to be given hereunder will be in writing and will be deemed given when delivered personally, sent by courier or registered or certified mail, postage prepaid, return receipt requested, addressed to the party concerned at the address indicated below or to such other address as such party may subsequently give notice hereunder in writing.  Any notice to be given hereunder other than to the Company may also be sent by email, provided that if the copies of such notices required hereunder are sent by email, notices to such persons shall be also be delivered personally or by mail as set forth herein:

 

	
To the Executive at:

	
Scott E. Howe  

 

 

Phone:  (206) 618-5819

E-mail:  scotthowe@live.com

 

	  
	
With a copy to:

	
David McShea

Perkins Coie LLP

1201 Third Avenue, 48th Floor

Seattle, WA 98101-3099

Phone:  (206) 359-8000

Email:  DMcShea@perkinscoie.com

 

	  
	
To the Company at:

	
Acxiom Corporation

601 East Third Street

Little Rock, AR 72201

Attention:  Senior Vice President – Legal

 

	  

 

  

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With a copy to:

	
Brian W. Berglund

Bryan Cave LLP

1700 Lincoln Street, Suite 4100

Denver, CO 80203-4541

Phone:  (303) 866-00264

Email:  bwberglund@bryancave.com

 

	  
	  	  	  

Any notice delivered personally or by courier under this Section 18 will be deemed given on the date delivered and any notice sent by email, or registered or certified mail, postage prepaid, return receipt requested, will be deemed given on the date transmitted by email, or five days after post-marked if sent by U.S. mail.

 

19.           Severability.  If any provision of this Agreement or the application of any such provision to any party or circumstances will be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement or the application of such provision to such person or circumstances other than those to which it is so determined to be invalid and unenforceable, will not be affected thereby, and each provision hereof will be validated and will be enforced to the fullest extent permitted by law.

 

20.           Governing Law.  This Agreement will be governed by and construed under the internal laws of the State of Delaware, without regard to its conflict of laws principles.

 

21.           Jurisdiction and Venue.  This Agreement will be deemed performable by all parties in, and venue will exclusively be in the state or federal courts located in the State of Delaware.  The Executive and the Company hereby consent to the personal jurisdiction of these courts and waive any objections that such venue is objectionable or improper.

 

22.           Headings.  All descriptive headings of sections and paragraphs in this Agreement are intended solely for convenience, and no provision of this Agreement is to be construed by reference to the heading of any section or paragraph.

 

23.           Withholding.  All payments to the Executive under this Agreement will be reduced by all applicable withholding required by federal, state or local law.

 

24.           Counterparts.  This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

25.           409A.

 

(a)           Notwithstanding any other provision to the contrary, a termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of “deferred compensation” (as such term is defined in Section 409A of the Code and the Treasury Regulations promulgated thereunder) upon or following a termination of employment unless such termination is also a “separation from service” from the Company within the meaning of Section 409A of the Code and Section 1.409A-1(h) of the Treasury Regulations and, for purposes of any such provision of this Agreement, references to a “separation,” “termination,” “termination of employment” or like terms shall mean “separation from service.”

 

  

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(b)           Notwithstanding any other provision to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Section 409A of the Code and the Treasury Regulations promulgated thereunder be subject to offset by any other amount unless otherwise permitted by Section 409A of the Code.

 

(c)           For the avoidance of doubt, any payment due under this Agreement within a period following the Executive’s termination of employment or other event, shall be made on a date during such period as determined by the Company in its sole discretion.

 

(d)           It is intended that the Agreement, to the extent practicable, comply and be interpreted in accordance with Section 409A of the Code, and the Company shall, as necessary, adopt such conforming amendments as are necessary to comply with Section 409A of the Code without reducing the benefits payable hereunder without the express written consent of the Executive.

 

(e)           To the extent that any reimbursement, fringe benefit or other, similar plan or arrangement in which the Executive participates during the term of Executive’s employment under this Agreement or thereafter provides for a “deferral of compensation” within the meaning of Section 409A of the Code, (i) the amount eligible for reimbursement or payment under such plan or arrangement in one calendar year may not affect the amount eligible for reimbursement or payment in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid), (ii) subject to any shorter time periods provided herein or the applicable plans or arrangements, any reimbursement or payment of an expense under such plan or arrangement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (iii) any such reimbursement or payment may not be subject to liquidation or exchange for another benefit, all in accordance with Section 1.409A-3(i)(1)(iv) of the Treasury Regulations.

 

(f)           By accepting this Agreement, the Executive hereby agrees and acknowledges that the Company does not make any representations with respect to the application of Section 409A of the Code to any tax, economic or legal consequences of any payments payable to the Executive hereunder.  Further, by the acceptance of this Agreement, the Executive acknowledges that (i) the Executive has obtained independent tax advice regarding the application of Section 409A of the Code to the payments due to the Executive hereunder, (ii) the Executive retains full responsibility for the potential application of Section 409A of the Code to the tax and legal consequences of payments payable to the Executive hereunder and (iii) the Company shall not indemnify or otherwise compensate the Executive for any violation of Section 409A of the Code that my occur in connection with this Agreement.

 

[Signature Page Follows]

 

  

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IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement effective as of date set forth above.

 

 

 

	 	
 ACXIOM CORPORATION

 

	 
	 	 	 
	 	 By: 	 
	 	 Name: 	 
	 	 Title: 	 
	 	 	 
	 	
 

EXECUTIVE

	 
	 	
 

 

	 
	 	 Scott E. Howe	 

 

                                                             

                                                              

                                                            

 

  

19

  

 

 

 

 

 

 

	 	             EXHIBIT A	 
	 	 	 
	 	          Current Boards of Directors	 

 

 

Blue Nile

 

Health123

 

  

A-1

  

 

EXHIBIT B

 

Form of General Release

 

This Release (this “Release”), dated as of _________, is made by and among Scott E.  Howe (the “Executive”) and Acxiom Corporation and all of its subsidiaries (collectively, the “Company”).

 

WHEREAS, the parties hereto entered into that certain Employment Agreement dated as of ____________, 2011 (the “Agreement”);

 

WHEREAS, the Executive’s employment with the Company has been terminated in a manner described in Section _____ of the Agreement;

 

WHEREAS, pursuant to Section ____ of the Agreement, it is a condition precedent to the Company’s obligation to make the payments under Section _____, that the Executive executes and delivers this Release.

 

             NOW THEREFORE, for good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows:

 

1.           Executive Release.  The Executive, ON BEHALF OF HIMSELF, HIS SPOUSE, ATTORNEYS, HEIRS, EXECUTORS, ADMINISTRATORS, AGENTS, ASSIGNS AND ANY TRUSTS, PARTNERSHIPS AND OTHER ENTITIES UNDER HIS CONTROL AND ANY OTHER PERSON CLAIMING BY, THROUGH OR UNDER THE EXECUTIVE (TOGETHER, THE “EXECUTIVE PARTIES”), HEREBY GENERALLY RELEASES AND FOREVER DISCHARGES the Company, its respective predecessors, successors and assigns and its respective past and present stockholders, members, directors, officers, employees, agents, representatives, principals, insurers and attorneys (together the “Company Parties”) from any and all claims, demands, liabilities, suits, damages, losses, expenses, attorneys’ fees, obligations or causes of action, KNOWN OR UNKNOWN, CONTINGENT OR NON-CONTINGENT of any kind and every nature whatsoever, and WHETHER OR NOT ACCRUED OR MATURED, which any of them have or may have, arising out of or relating to any transaction, dealing, relationship, conduct, act or omission, OR ANY OTHER MATTERS OR THINGS OCCURRING OR EXISTING AT ANY TIME PRIOR TO AND INCLUDING THE EXECUTION DATE OF THIS RELEASE (including, but not limited to, any claim against the Company Parties based on, relating to or arising under wrongful discharge, breach of contract (whether oral or written), tort, fraud (but excluding fraudulent inducement into signing this Release), defamation, negligence, promissory estoppel, retaliatory discharge, Title VII of the Civil Rights Act of 1964, as amended, any other civil or human rights law, the Age Discrimination in Employment Act of 1967, Americans with Disabilities Act, Section 409A of the Internal Revenue Code or 1986, as amended (the “Code”) or any other applicable provisions of the Code, Employee Retirement Income Security Act of 1974, as amended, or any other federal, state or local law relating to employment or discrimination in employment) arising out of or relating to the Executive’s employment by the Company or his services as an officer or employee of the Company or any of its subsidiaries, or otherwise relating to the termination of such employment or the Agreement (collectively, “Claims”); provided, however, such general release will not limit or release the Company Parties from their respective obligations (i) under the Agreement that expressly survive termination of employment or by their terms are required to be or only capable of being performed following the Date of Termination under the Agreement, (ii) under the Company’s benefit plans and agreements that expressly survive termination of employment, including without

 

  

B-1

  

 

limitation the Company’s equity incentive plans, (iii) in respect of the Executive’s services as an officer or director of the Company or any of its subsidiaries, pursuant to any director and officer indemnification agreements or insurance policies, or the certificates of incorporation or by-laws (or like constitutive documents) of the Company or any of its subsidiaries [in effect as of the date hereof or as provided by law] or [(iv) insert at the time of termination a description of any other agreements with the Company that expressly survive the Executive’s termination].  The Executive, ON BEHALF OF HIMSELF AND THE EXECUTIVE PARTIES, hereby represents and warrants that no other person or entity has initiated or, to the extent within his control, will initiate any such proceeding on his or their behalf.

 

2.            Non-Disparagement.  The Executive agrees that, for a period of one (1) year following the date hereof, the Executive shall not, in any communications with the press or other media or any customer, client or supplier of the Company or any of its subsidiaries, make any statement which disparages or is derogatory of the Company or any of its subsidiaries or any of their respective directors or senior officers; provided, however, that this Section 2 shall apply to the Executive only for so long as the Company, its subsidiaries and their respective directors and senior officers refrain from making any such communication which disparages or is derogatory of the Executive.

 

3.            Acknowledgement of Waiver of Claims under ADEA.  The Executive acknowledges that he is waiving and releasing any rights he may have under the Age Discrimination in Employment Act of 1967 and that this waiver and release is knowing and voluntary.  The Executive acknowledges that the consideration given for this waiver and release is in addition to anything of value to which the Executive was already entitled.  The Executive further acknowledges that (a) he has been advised that he should consult with an attorney prior to executing this Release, (b) he has been given twenty-one (21) days within which to consider this Release before executing it and (c) he has been given seven (7) days following the execution of this Release to revoke this Release.

 

4.            Acknowledgment.  The parties hereto acknowledge that they understand the terms of this Release and that they have executed this Release knowingly and voluntarily.  The Executive acknowledges that, in consideration for the covenants and releases contained herein, he will receive the payments as described in Section ____of the Agreement, and that he would not receive such payment without the execution of this Release.

 

5.            Severability.  All provisions of this Release are intended to be severable.  In the event any provision or restriction contained herein is held to be invalid or unenforceable in any respect, in whole or in part, such finding shall in no way affect the validity or enforceability of any other provision of this Release.  The parties hereto further agree that any such invalid or unenforceable provision shall be deemed modified so that it shall be enforced to the greatest extent permissible under law, and to the extent that any court or arbitrator of competent jurisdiction determines any restriction herein to be unreasonable in any respect, such court or arbitrator may limit this Release to render it reasonable in the light of the circumstances in which it was entered into and specifically enforce this Release as limited.

 

  

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6.            Specific Performance.  If a court of competent jurisdiction determines that the Executive has breached or failed to perform any part of this Release, the Executive agrees that the Company will be entitled to seek injunctive relief to enforce this Release.

 

7.            Governing Law.  This Release shall be governed by and construed in accordance with the laws of the State of Delaware without regard to its conflict of laws principles.

 

8.            Jurisdiction and Venue.  This Release will be deemed performable by all parties in, and venue will exclusively be in the state and federal courts located in, the State of Delaware.  The Executive hereby consents to the personal jurisdiction of these courts and waives any objection that such venue in objectionable or improper.

 

[Signature Page Follows]

 

  

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IN WITNESS WHEREOF, the Executive has hereunto set his hands, as of the day and year first above written.

 

 

	 	 	 	 
	 	 	 Scott E. Howe, individually	 

 

 

 

 

  

B-4Unassociated Document

 

Exhibit 10.2

 

ACXIOM CORPORATION

 

2010 EXECUTIVE OFFICER SEVERANCE POLICY

 

 

SECTION 1

 

PURPOSE

 

The purpose of the Policy is to provide Severance Benefits for the Executive Officers of the Company.

 

 

SECTION 2

 

DEFINITIONS

 

 As used herein, the following words and phrases shall have the following meanings:

 

 2.1 “Actual Cash Bonus” shall mean a cash bonus payment based on the extent to which the performance goals relating to such bonus are ultimately achieved, pro-dated based on the portion of the Fiscal Year the Participant worked for the Company.

 

 2.2 “Affiliate” shall mean, with respect to any person or entity, any entity directly or indirectly controlled by, controlling or under common control with such person or entity.  Notwithstanding the foregoing, for purposes of determining whether an Executive Officer has had a Separation from Service, Section 1.409A-1(h)(3) of the Treasury Regulations shall determine whether an Affiliate is a “service recipient” under Code Section 409A.

 

 2.3 “Annual Salary Amount” shall mean a Participant’s annual base salary in effect on the Termination Date (or in the case of a Change in Control Termination, if greater, immediately before any reduction in such base salary giving rise to Good Reason), without reduction for any pre-tax contributions to benefit plans or state or federal taxes. Base salary does not include bonuses, commissions, premium pay, cost of living allowances or income from stock options, stock grants or other incentives.

 

2.4 “Average Annual Cash Bonus” shall mean the average annual cash bonus for the two Fiscal Years preceding the Termination Date.

 

2.5 “Board” shall mean the Board of Directors of the Company.

 

2.6 “Cash Severance Benefit” shall mean any severance benefit paid in cash due to a Qualifying Separation from Service in accordance with the terms of the Policy.

 

2.7 “Cause” for termination by the Company of the Participant’s employment shall mean: (i) the willful failure by Participant to substantially perform his or her duties or follow the reasonable and lawful instructions of his or her supervisor; provided, that the Participant will be allowed to cure such failure within thirty (30) days of delivery to the Participant by the Company of written demand for performance, which such written demand will specifically identify the manner in which the Company believes he or she has not substantially performed his duties; (ii) the engaging by the Participant in willful misconduct, or the Participant’s gross negligence, that is materially injurious to the Company, monetarily or otherwise;  (iii) the conviction of, or pleading guilty or nolo contendere to, any felony or a fraud; or (iv) the Participant’s material breach of the provisions of this Policy or of any material employment policy of the Company, which, if curable, is not cured within thirty (30) days of delivery to the Participant by the Company of written notice thereof.

 

  

  

  

2.8 “Change in Control” shall mean the occurrence during the term of the Policy of any one of the following events:

 

(i)        An acquisition of any securities of the Company entitled to vote generally in the election of directors (the “Voting Securities”) by any “person” (as the term person is used for purposes of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) immediately after which such person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of thirty percent (30%) or more of the combined voting power of the then outstanding Voting Securities; provided, however, that in determining whether a Change in Control has occurred, Voting Securities that are acquired in a “Non-Control Acquisition” will not constitute an acquisition that would cause a Change in Control. A “Non-Control Acquisition” will mean (i) an acquisition by an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any corporation or other person of which a majority of its voting power or its equity securities or equity interest is owned directly or indirectly by the Company (a “Subsidiary”), (ii) any acquisition by or directly from the Company or any Subsidiary, or (iii) an acquisition pursuant to a Non-Qualifying Transaction (as defined in Section 2.6(iii) below);

 

(ii)       The individuals who, on the Effective Date, constitute the Board of Directors of the Company (the “Incumbent Directors”) cease for any reason to constitute at least a majority of such board, provided that, any person becoming a director after the Effective Date and whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board of Directors will be an Incumbent Director; provided however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to the election or removal of directors (“Election Contest”) or other actual or threatened solicitation of proxies or consents by or on behalf of any “person” (such term for purposes of this definition being as defined in Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) and 14(d)(2) of the 1934 Act) other than the Board of Directors (“Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest, will be deemed an Incumbent Director; or

 

(iii)      Consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company (a “Reorganization”), or the sale or other disposition of all or substantially all of the Company’s assets (a “Sale”) or the acquisition of assets or stock of another corporation (an “Acquisition”), unless immediately following such Reorganization, Sale or Acquisition:

 

(A)       The stockholders of the Company immediately before such Reorganization, Sale or Acquisition, beneficially own, directly or indirectly, immediately following such Reorganization, Sale or Acquisition, more than fifty percent (50%) of the combined voting power of the outstanding Voting Securities of the Company resulting from such Reorganization, Sale or Acquisition (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets or stock either directly or through one or more subsidiaries, the “Surviving Corporation”) in substantially the same proportion as their ownership of the Voting Securities immediately before such Reorganization, Sale or Acquisition;

 

(B)       The individuals who were members of the Incumbent Board immediately before the execution of the agreement providing for such Reorganization, Sale or Acquisition constitute at least a majority of the members of the board of directors of the Surviving Corporation; and

 

(C)       No person (other than the Company, any Subsidiary, any employee benefit plan (or any trust forming a part thereof) maintained by the Company, the Surviving Corporation or any Subsidiary, or any person who, immediately before such Reorganization, Sale or Acquisition, had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Voting Securities), has Beneficial Ownership of thirty percent (30%) or more of the combined voting power of the Surviving Corporation’s then outstanding Voting Securities;

 

Any Reorganization, Sale or Acquisition which satisfies all of the criteria specified in subparts (A), (B) and (C) of this Section 2.6(iii) above will be deemed to be a “Non-Qualifying Transaction.” Notwithstanding the foregoing, a “Change in Control” will not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities of the Company as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities outstanding, increased the proportional number of shares Beneficially Owned by the Subject Person.

 

  

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(iv)    Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

Notwithstanding the foregoing, to the extent that (i) any payment under this Policy is payable solely upon or following the occurrence of a Change in Control and (ii) such payment is treated as “deferred compensation” for purposes of Code Section 409A, a Change in Control shall mean a “change in the ownership of the Company,” a “change in the effective control of the Company,” or a “change in the ownership of a substantial portion of the assets of the Company” as such terms are defined in Section 1.409A-3(i)(5) of the Treasury Regulations.

 

2.9 “Change in Control Termination” shall mean a Participant’s Separation from Service (i) initiated by the Company other than for Cause within the two years following a Change in Control or (ii) initiated by the Participant for Good Reason within two years following a Change in Control.

 

2.10 “Code” shall mean the Internal Revenue Code of 1986, as amended.

 

2.11 “Company” shall mean Acxiom Corporation and successors and, when used in relation to the Participant’s employment includes all wholly owned subsidiaries of Acxiom Corporation.  For purposes of this Policy, the terms “employ,” “employee” and “employment” shall be construed to refer to the provision of services by the Participant to the Company, irrespective of whether the Participant is classified as an employee of the Company under the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.  Notwithstanding the foregoing, for purposes of determining whether an Executive Officer has had a Separation from Service, Section 1.409A-1(h)(3) of the Treasury Regulations shall determine whether a subsidiary is a “service recipient” under Code Section 409A.

 

2.12 “Effective Date” of the Policy is November 9, 2010 and as amended herein on May 20, 2014. 

 

2.13  “Equity Severance Benefit” shall mean any benefit resulting in the vesting of outstanding non-qualified stock options, restricted stock, restricted stock units or any other equity award (other than Performance Units) granted by the Company, due to a Qualifying Separation from Service in accordance with the terms of the Policy.

 

2.14 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.

 

2.15 “Executive Officer” shall mean as of a particular day, the officers of the Company designated as executive officers for purposes of Section 16 of the Securities Exchange Act of 1934 most recently by the Board, other than any “executive officer” who has an employment agreement with the Company that is in effect on that day.

 

2.16 “Fiscal Year” shall mean the period of time from April 1 of one year to March 31 of the following year and which is the annual period used by the Company for financial reporting purposes. 

 

2.17 “Good Reason” for a Participant’s Separation from Service shall mean the occurrence (without the Participant’s express written consent) of any one of the following acts by the Company, or failures by the Company to act, following the occurrence of a Change in Control:

 

 (i) a reduction by the Company in the Participant’s title or position, or a material reduction by the Company in the Participant’s authority, duties or responsibilities, or the assignment by the Company to the Participant of any duties or responsibilities that are materially inconsistent with such title, position, authority, duties or responsibilities; (ii) a reduction in Annual Salary Amount; or (iii) the Company’s requiring the Participant to relocate his office location more than fifty (50) miles from his office location at the time of the Change in Control. For avoidance of doubt, “Good Reason” will exclude the death or Permanent Disability of the Participant.

 

  

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Notwithstanding the foregoing, the occurrence of an event that would otherwise constitute Good Reason hereunder shall cease to be an event constituting Good Reason if (i) the Participant fails to provide the Company with notice of the occurrence of any of the foregoing within the ninety-day period immediately following the occurrence of such event, (ii) the Participant fails to provide the Company with a period of at least thirty days from the date of such notice to cure such event prior to providing a Notice of Termination for Good Reason or (iii) the Termination Date specified in the Notice of Termination delivered to Company is not within thirty days following the day on which the thirty-day period set forth in the preceding clause (ii) expires; provided, that the thirty-day notice period required by clause (ii)  shall end two days prior to the second anniversary of the Change in Control in the event that the second anniversary of the Change in Control would occur during such thirty-day period.

 

 2.18 “Notice of Termination” shall mean a notice that indicates the specific provisions in this Policy relied upon as the basis for any Separation from Service and sets forth in reasonable detail the facts and circumstances claimed to provide a basis for a Participant’s Separation from Service under the provision so indicated.  No purported Separation from Service with or without Cause or for Good Reason shall be effective without a Notice of Termination.

 

2.19 “Participants” shall mean Executive Officers of the Company who meet the eligibility requirements of Section 3 of the Policy.

 

2.20 “Performance Unit” shall mean any equity incentive awards granted by the Company to Executive Officers that are earned based upon achievement of performance measures during a performance period as defined by the accompanying grant documents.

 

2.21 “Performance Unit Benefit” shall mean any benefits payable for earned or unearned, unvested Performance Units in accordance with the terms of this Policy.

 

2.22 “Permanent Disability” shall mean (i) that a Participant is eligible to receive long-term disability benefits under the disability plan in which the Participant participates as of the Termination Date, or (ii) if there is no such plan as of the Termination Date, that the Participant has been substantially unable to perform his or her duties, services and responsibilities to the Company, with a reasonable accommodation if necessary, by reason of a physical or mental infirmity for 180 consecutive days, or for a total of 180 days or more in any consecutive 360 day period as certified by a physician selected by the Policy Administrator.

 

2.23 “Policy” shall mean the Acxiom Corporation, Inc. 2010 Executive Severance Policy as set forth in this document.

 

2.24 “Policy Administrator” shall mean the Compensation Committee of the Board or other person or group designated by the Company to serve as Policy Administrator.

 

2.25 “Qualifying Separation from Service” shall mean a Participant’s Separation from Service that (i) is involuntary and initiated by the Company without Cause at any time other than during the period specified in the Change in Control Termination definition; or (ii) meets the definition of a Change in Control Termination.  For the avoidance of doubt, a Separation from Service will not constitute a Qualifying Separation from Service and no Severance Benefits shall be payable to a Participant should the Participant’s Separation from Service be (a) initiated by the Company for Cause, (b) by reason of Permanent Disability, (c) by reason of the Participant’s death, or (d) initiated by the Participant; provided, however, that in the case of a Change in Control Termination, a Separation from Service initiated by the Participant for Good Reason will be considered a Qualifying Separation from Service.

 

  

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 2.26 “Release of Claims” shall mean the agreement that a Participant must execute in order to receive Severance Benefits under the Policy, which shall be approved by the Policy Administrator and shall contain, among such other terms and conditions determined by the Policy Administrator, typical post separation terms and a mutual general release of: (i) all claims that the Participant may have against the Company and any of its Affiliates relating to the employment and termination of employment of the Participant, including, but not limited to, any claims for bonus payments pursuant to the Company’s bonus plan or otherwise and (ii) all claims that the Company and any of its Affiliates may have against the Participant relating to the employment and termination of employment of the Participant, excluding any claim arising from Participant’s contractual obligations or restrictions (whether contained herein, in equity grant agreements, or elsewhere) that are intended to extend beyond the termination of employment (including, but not limited to, non-competition, non-solicitation, confidentiality and clawback provisions) and any matters relating to a violation of law or that could otherwise result in Company liability.  The Release of Claims will also contain an agreement by the Participant to be bound by the terms of Section 4.5 hereof.

 

 2.27 “Separation from Service” shall mean an Executive Officer’s cessation of services to the Company and/or its Affiliates.  For purposes of this Policy, an Executive Officer is treated as continuing in employment with the Company while the Executive Officer is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the Executive Officer retains a right to reemployment with the Company under an applicable statute or by contract.  A leave of absence shall constitute a bona fide leave of absence only if there is (i), to the extent applicable, a right to reemployment under an applicable statute or by contract or (ii) a reasonable expectation an Executive Officer will return to perform services for the Company following such leave.  For purposes of this Policy and the application of Section 409A, if the period of leave exceeds six months and an Executive Officer does not retain a right to reemployment under an applicable statute or by contract, the Executive Officer will be deemed to have a Separation from Service on the first date immediately following such six-month period.  For purposes of this Policy, an Executive Officer shall be deemed to have experienced a Separation from Service on any date that it is reasonably anticipated that the Executive Officer would perform no further services or that the Executive Officer’s level of bona fide services performed for the Company will decrease to a level equal to twenty percent or less of the average level of services rendered by the Executive Officer during the thirty-six-month period ending on such date or the full period of services rendered by the Executive Officer for the Company if the Executive Officer has been providing services to the Company for less than thirty-six months as of such date.  Whether a Separation from Service has occurred will be determined in accordance with Treasury Regulation 1.409A-1(h), or any successor thereto.

 

2.28 “Severance Benefits” shall mean one or more of the following as provided by the Policy following a Qualifying Separation from Service:  (i) Cash Severance Benefit, (ii) Equity Severance Benefit or (iii) Performance Unit Benefit.

 

 2.29 “Severance Delay Period” shall mean the period beginning on the Termination Date and ending on the thirtieth day thereafter.  Notwithstanding the foregoing, in the event that the Participant's Separation from Service occurs in connection with an exit incentive program or other employment termination program offered to a group or class of employees, as defined under the Older Worker Benefit Protection Act, 29 U.S.C. Section 626, the Severance Delay Period shall mean the period beginning on the Termination Date and ending on the sixtieth day thereafter.

 

2.30 “Termination Date” shall mean the date of a Participant’s Separation from Service with the Company as determined in accordance with Section 5.

 

 

  

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SECTION 3

 

ELIGIBILITY

 

 3.1 Commencement of Participation. Each Executive Officer shall automatically be a Participant in the Policy as of the Effective Date. Each individual who is designated by the Board as an Executive Officer following the Effective Date shall automatically be a Participant in the Policy as of the date of such designation.  As a condition to any Executive Officer’s participation in the Policy he or she must acknowledge termination of any other employment agreements or severance arrangements with the Company.  Additionally, the Policy Administrator may require as a condition of participation or continued participation that any Participant execute documents agreeing to be bound by any clawback policy adopted by the Board from time to time.

 

3.2 Duration of Participation.

 

(a) A Participant shall cease to be a Participant if he or she ceases to be an Executive Officer. To avoid any doubt, the Board shall have full discretion to add or remove Executive Officers.

 

(b) A Participant entitled to Severance Benefits under the terms of this Policy shall remain a Participant in the Policy until the full amount of the Severance Benefits have been paid to him or her, subject to the Restrictions provided in Section 4.5.

 

3.3 Eligibility for Severance Benefits.

 

 (a) Subject to Section 3.3(b), a Participant shall be entitled to receive Severance Benefits from the Company as specified in Section 4.

 

 (b) No Severance Benefits will be provided to a Participant unless the Participant has properly executed and delivered to the Company a Release of Claims and that Release of Claims has become irrevocable as provided therein prior to the expiration of the Severance Delay Period.  Such Release of Claims shall not be accepted by the Company unless it is executed on or after the Participant’s Termination Date.

 

(c) Subject to Section 1.409A – 1(h)(3) of the Treasury Regulations, for purposes of determining a Participant’s and the Company’s rights and obligations under the Policy, the transfer of employment of a Participant from the Company to one of its Affiliates, or from such an Affiliate to the Company, in each case whether before or after the Change in Control, shall not constitute a Separation from Service for purposes of the Policy.

 

(d)  To the extent consistent with Code Section 409A, a participant is not entitled to any Severance Benefits if his or her employment is terminated by the Company in connection with a sale, divestiture, or other disposition of all or a portion of the stock or assets of the Company or any of its Affiliates that does not constitute a Change in Control (a “Transaction”) if: (i) the Participant is offered a position with the counterparty to the Transaction (or an Affiliate of such counterparty); and (ii) the Policy Administrator determines that the cash compensation to be provided to the Participant in such position is comparable to the Participant’s then current cash compensation. For clarification purposes, this Section 3.3(d) is intended solely to limit, and not to expand, the benefits provided for elsewhere in this Policy.

 

3.4 Death of a Participant.

 

If a Participant whose employment terminates in a Qualifying Separation from Service dies after his or her Termination Date but before the Participant receives the Severance Benefits to which he or she is entitled, the payment will be made to the Participant’s surviving spouse or, if the Participant does not have a surviving spouse, to the Participant’s estate;  provided, however,  that no Severance Benefit will be paid pursuant to this Section 3.4 unless the surviving spouse or the executor of the Participant’s estate, or any or all of the foregoing, upon the request of the Policy Administrator, properly execute and deliver to the Company a Release of Claims on behalf of the Participant that has become irrevocable as provided therein prior to the expiration of the Severance Delay Period.

 

  

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SECTION 4

 

BENEFITS

 

4.1 Qualifying Separation from Service Other Than a Change in Control Termination.

 

(a) In the event a Participant has a Qualifying Separation from Service other than a Change in Control Termination, and the Policy Administrator determines that he or she is entitled to a Cash Severance Benefit, such Participant will be eligible to receive a Cash Severance Benefit in an amount equal to such Participant’s Annual Salary Amount, Average Annual Cash Bonus, and Actual Cash Bonus..

 

(b)  Notwithstanding anything contained in any equity plan or grant documents, in the event Participant has a Qualifying Separation from Service other than a Change in Control Termination, and the Policy Administrator determines that he or she is entitled to a Performance Unit Benefit, such Participant will be eligible to receive: (i) the number of Performance Units, if any, that were earned during a completed performance period but remain unvested, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Termination Date and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture; (ii) the number of  Performance Units, if any, for performance periods that are ongoing as of the Termination Date and for which at least one-year of the performance period has elapsed as of the Termination Date, multiplied by a fraction, the numerator of which is the full number of calendar months that elapsed between the beginning of the performance period and the Termination Date and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture, with the settlement of such performance units to occur after the completion of the applicable performance period based upon the Company’s actual performance as determined following the completion of the applicable performance periods in accordance with the terms of the Performance Unit grant documents.

 

4.2 Change in Control and Performance Unit Benefit.

 

In the event of a Change in Control, whether or not accompanied by a Qualifying Separation from Service, if the Policy Administrator determines that a Participant is entitled to a Performance Unit Benefit, a Participant shall earn and become 100% vested in a prorated portion of any Performance Units for performance periods that are ongoing as of the Change in Control and for which at least one-year of the performance period has elapsed as of the Change in Control as calculated pursuant to the following sentence, notwithstanding anything contrary in any equity incentive plan or agreement, including without limitation, the 2005 Equity Plan or the related award agreements. The amount of the prorated Performance Units will be determined in accordance with the terms of the Performance Unit grant documents based upon the Company’s performance as of the date of the Change in Control as if the performance period had been completed, and then multiplied by a fraction, the numerator of which is the full number of calendar months that have elapsed since the beginning of the performance period and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture. Additionally, in the event of a Change in Control, whether or not accompanied by a Qualifying Separation from Service, if the Policy Administrator determines that a Participant is entitled to a Performance Unit Benefit, a Participant shall become 100% vested in a prorated portion of Performance Units that were earned during a completed performance period but remain unvested as calculated pursuant to the following sentence, notwithstanding anything to the contrary in any equity incentive plan or agreement, including without limitation, the

 

  

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2005 Equity Plan, or the related award agreements.  The amount of prorated Performance Units will be determined based upon the number of Performance Units, if any, that were earned during the completed performance period but remain unvested, and then multiplied by a fraction, the numerator of which is the full number of calendar months that have elapsed since the beginning of the performance period and the denominator of which is the number of months between the beginning of the performance period and when the award would fully vest and no longer be subject to forfeiture.

 

4.3 Change in Control Termination.

 

 (a) In the event of a Change in Control Termination, if the Policy Administrator determines that a Participant is entitled to a Cash Severance Benefit, such Participant will be eligible to receive an amount of cash equal to Participant’s Actual Cash Bonus, one and one half times such Participant’s Annual Salary Amount and one and one half times such Participant’s Average Annual Cash Bonus.  Notwithstanding the forgoing, any reduction in the Annual Salary Amount taken by the Company or any of its Affiliates that (i) forms a basis of a Participant’s Separation from Service for Good Reason or (ii) is taken following the provision of a Notice of Termination and would constitute Good Reason shall be disregarded in calculating the payments and benefits to be provided pursuant to this Section 4.3.

 

 (b) In the event of a Change in Control Termination, if the Policy Administrator determines that a Participant is entitled to an Equity Severance Benefit, then a Participant’s unvested outstanding non-qualified stock options, restricted stock, restricted stock units and any other equity awards (other than Performance Units) granted prior to the date of the Change in Control and outstanding as of the Termination Date (“Stock Awards”) shall vest, notwithstanding anything to the contrary in any equity incentive plan or agreement, including without limitation, the 2005 Equity Plan, or the related award agreements.  Stock Awards shall include any awards covering the securities of a successor company and any rights to cash of an equivalent value (as of the Change in Control) substituted for equity awards of the Company.

 

 4.4 Form and Time of Payment

 

(a) In the Event of a Qualifying Separation from Service other than a Change in Control Termination, the Cash Severance Benefit, other than the Actual Cash Bonus, shall be paid in twenty-four semi-monthly payments in accordance with the Company’s normal payroll cycle, less any applicable state and federal taxes required to be withheld, with such payments commencing on the normal payroll cycle occurring immediately following the expiration of the Severance Delay Period.  The Actual Cash Bonus shall be payable on the date when such bonus otherwise would be paid absent a termination of employment and following expiration of the Severance Delay Period. As a condition to receiving such payments, the Participant must execute the Release of Claims and let expire any period during which the Participant may revoke such Release of Claims pursuant to the terms of the Release of Claims prior to the expiration of the Severance Delay Period.

 

(b) In the Event of a Qualifying Separation from Service other than a Change in Control Termination, payment of any Performance Unit Benefit in accordance with Section 4.1(b)(i) shall be processed within thirty (30) days following the expiration of the Severance Delay Period, and any payment of any Performance Unit Benefit in accordance with Section 4.1(b)(ii) will be made as soon as administratively practicable after the end of the performance period stated in the applicable grant documents and at the time the Participant would have received payment had the Participant remained employed.  As a condition to receiving such benefits, the Participant must execute the Release of Claims and let expire any period during which the Participant may revoke such Release of Claims pursuant to the terms of the Release of Claims prior to the expiration of the Severance Delay Period.

 

(c) In the event of a Change in Control only, payment of any Performance Unit Benefit in accordance with Section 4.2 shall be processed within thirty (30) days after the Change in Control.

 

  

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(d) In the event of a Change in Control Termination only, any Cash Severance Benefit, other than the Actual Cash Bonus, shall be paid in a lump sum, less any applicable state and federal taxes required to be withheld, on the normal payroll cycle occurring immediately following the expiration of the Severance Delay Period.  The Actual Cash Bonus shall be payable on the date when such bonus otherwise would be paid absent a termination of employment and following expiration of the Severance Delay Period. As a condition to receiving such payments, the Participant must execute the Release of Claims and let expire any period during which the Participant may revoke such Release of Claims pursuant to the terms of the Release of Claims prior to the expiration of the Severance Delay Period.

 

(e) In the event of a Change in Control Termination only, any Equity Severance Benefit shall be processed within thirty (30) days following the expiration of the Severance Delay Period.  As a condition to receiving such Equity Severance Benefit, the Participant must execute the Release of Claims and let expire any period during which the Participant may revoke such Release of Claims pursuant to the terms of the Release of Claims prior to the expiration of the Severance Delay Period.

 

(f) It is intended that (i) each payment or installment of payments provided under this Policy is a separate “payment” for purposes of Code Section 409A and (ii) that the payments satisfy, to the greatest extent possible, the exemptions from the application of Code Section 409A including those exceptions provided under Treasury Regulations 1.409A-1(b)(4) (regarding short-term deferrals), 1.409A-1(b)(9)(iii) (regarding the two-times, two year exception), and 1.409A-1(b)(9)(v) (regarding reimbursements and other separation pay).  Notwithstanding anything to the contrary in this Policy, if the Company determines (i) that on the date of an Executive Officer’s Separation from Service or at such other time that the Company determines to be relevant, the Executive Officer is a “specified employee” (as such term is defined under Treasury Regulation 1.409A-1(i)(1)) of the Company and (ii) that any payments to be provided to the Executive Officer pursuant to this Policy are or may become subject to the additional tax under Code Section 409A(1)(B) or any other taxes or penalties under Code Section 409A (“Section 409A Taxes”) if provided at the time otherwise required under this Policy, then such payments shall be delayed until the date that is six months after the date of the Executive Officer’s Separation from Service with the Company, or if earlier, the Executive Officer’s death.  Any payments delayed pursuant to this Section 4.4(f) shall be made in a lump sum on the first day of the seventh month following the Executive Officer’s Separation from Service or, if earlier, the Executive Officer’s death and any remaining payments shall be made in accordance with the Policy.

 

4.5 Benefits Conditional

 

(a) Anything in this Policy to the contrary notwithstanding, all payments and benefits for each Participant eligible according to Sections 4.1, 4.2 and 4.3 are conditional upon such Participant’s compliance with the Restrictions on Competitive Employment and Restrictions Against Solicitation and Inducement described below (collectively the “Restrictions”). Until such Restrictions are completely satisfied, the Participant shall be a constructive trustee of such payments and benefits and shall return them to the Company promptly if he/she violates any aspect of such Restrictions.

 

(b) During employment, and for a period of 12 months following a Qualifying Separation from Service, the Participant will not (as an individual, principal, agent, employee, consultant, director or otherwise), directly or indirectly in any territory in which the Company and/or any of its Affiliates does business and/or markets its products and services, engage in activities competitive with, nor render services to any firm or business engaged or about to become engaged in the Business of the Company (collectively, “Restrictions on Competitive Employment”). The Business of the Company includes, but is not limited to, information management products, marketing solutions and other services related to customer acquisition, growth and retention, including data collection, data integration technology and services, database services, information technology outsourcing, consulting and analytics services and

 

  

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consumer privacy products and services, or any other significant business in which the Company or any of its subsidiaries is engaged in, in each case where such products or services are competitive with products or services offered by the Company or any of its subsidiaries that constitute more than five percent (5%) of the Company’s revenues in any of its eight (8) preceding fiscal quarters. In addition, the Participant will not have an equity interest in any such firm or business other than as a 1% or less shareholder of a public corporation.

 

(c) During employment and for a period of 12 months following a Qualifying Separation from Service, the Participant will not, directly or indirectly, on the Participant’s own behalf or on behalf of any other person or entity, do any of the following (collectively, “Restrictions Against Solicitation and Inducement”): (i) solicit or contact any customer or targeted potential customer of the Company and/or its Affiliates upon whom he/she called or solicited or with whom he/she became acquainted after commencement of employment with the Company and/or its Affiliates; (ii) induce or attempt to induce, any employees, agents or consultants of the Company and/or its Affiliates to do anything from which he or she is restricted by reason of this Policy or any agreement between the Participant and the Company that restricts the Participant against solicitation or inducement; (iii) offer or aid others to offer employment to, otherwise solicit the services of, or solicit to terminate their employment or agency with the Company any employees, agents, or consultants of the Company and/or its Affiliates; or (iv) provide services to any customer, solicit any vendor or supplier of the Company for the purpose of either providing products or services to do a business competitive with the Company, or otherwise interfere with or disrupt or attempt to disrupt any contractual or potential contractual relationship between any customer, vendor or supplier and the Company and/or its Affiliates.

 

(d) The Restrictions applicable to Participants are effective for the time stated in this Policy and do not affect and are not affected by any other similar restrictions that may apply or may in the future apply to such Participant pursuant to any other plan, agreement or other arrangement.   Any other similar obligations under other agreements, including the Associate Agreement and any Equity grant agreements, entered into between a Participant and Company shall remain in effect and the Participant shall remain bound by the terms of this Policy as well as such other agreements or obligations. Furthermore, the Release of Claims will contain the restrictions and covenants contained in this Section 4.5 (modified if necessary to comply with appropriate state law) and a provision that the restrictions and covenants contained in this Policy and the Release of Claims are reasonable and necessary to protect the legitimate interests of the Company and that the services rendered by the Participant were of a special, unique and extraordinary character. The Release of Claims will also contain a provision that the Company will be entitled to injunctive relief, which entails that (i) it would be difficult to replace the Participant’s services; (ii) the Company would suffer irreparable harm that would not be adequately compensated by monetary damages and (iii) the remedy at law for any breach of any of the restrictions and covenants contained in this Policy and the Release of Claims may be inadequate. The Participant will further agree and acknowledge in the Release of Claims that the Company will be entitled, in addition to any remedy at law or in equity, to obtain preliminary and permanent injunctive relief and specific performance for any actual or threatened violation of any of the restrictive covenants contained in this Policy and the Release of Claims. This provision with respect to injunctive relief will not, however, diminish the right to claim and recover damages, or to seek and obtain any other relief available to it at law or in equity, in addition to injunctive relief.

 

(e) Notwithstanding anything contained herein, any amounts paid or payable to a Participant pursuant to this Policy or otherwise by the Company, including any equity compensation granted to the Participant, may be subject to forfeiture or repayment to the Company pursuant to any clawback policy as adopted by the Board  from time to time and applicable to Executive Officers of the Company to the extent permitted by Code Section 409A, and Participant will be bound by any such policy while an Executive Officer and will agree to continue to be bound in the Release of Claims.

 

 4.6 Exclusive Payments; No Mitigation

 

  

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 Severance Benefits under this Policy are not intended to duplicate benefits such as (i) workers’ compensation wage replacement benefits, disability benefits, and pay-in-lieu-of-notice, (ii) severance pay, or similar benefits under other benefit plans, severance programs or agreements, or employment contracts, or (iii) applicable laws, such as the WARN Act. Should such other benefits be payable, a Participant’s benefits under this Policy will be reduced accordingly or, alternatively, benefits previously paid under this Policy will be treated as having been paid to satisfy such other benefit obligations in either case to the extent permitted by Code Section 409A.  In either case, the Policy Administrator will determine how to apply this provision and may override other provisions in this Policy in doing so.

 

SECTION 5

 

TERMINATION OF EMPLOYMENT

 

 5.1 Written Notice Required. Any purported Separation from Service for Cause, without Cause or for Good Reason, whether by the Company or by the Participant, shall be communicated by written Notice of Termination to the other.

 

 5.2 Termination Date. In the case of the Participant’s death, the Participant’s Termination Date shall be his or her date of death.  In the case of Permanent Disability, the Termination Date shall be the date established by Company according to standard policy and procedure.  In all other cases, the Participant’s Termination Date shall be the date specified in the Notice of Termination; provided however, that upon a Participant’s Separation from Service for Good Reason, the date specified in the Notice of Termination must comply with the provisions of Section 2.14.

 

  

 

SECTION 6

 

EFFECT OF SECTIONS 280G AND 4999 OF THE CODE

 

Notwithstanding anything contained in this Policy to the contrary, if any payment or benefit a Participant would receive from the Company pursuant to the Policy or otherwise ("Payment") would (i) constitute a "parachute payment" within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then the Payment will be equal to the Reduced Amount (defined below).  The "Reduced Amount" will be either (1) the largest portion of the Payment that would result in no portion of the Payment (after reduction) being subject to the Excise Tax or (2) the entire Payment, whichever amount after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes), results in the Participant’s receipt, on an after-tax basis, of the greatest amount of the Payment.  If a reduction in the Payment is to be made so that the Payment equals the Reduced Amount, (x) the Payment will be paid only to the extent permitted under the Reduced Amount alternative, and the Participant will have no rights to an additional payments and/or benefits constituting the Payment.  In no event will the Company or any stockholder be liable to a Participant for any amounts not paid as a result of the operation of this Section 6.  No portion of any Payment shall be taken into account which in the opinion of tax counsel does not constitute a “parachute payment” within the meaning of Code Section 280G(b)(2), including by reason of Code Section 280G(b)(4)(A).

 

To the extent permitted by Code Section 409A, unless Participant shall have given prior written notice specifying a different order to the Company to effectuate the Reduced Amount, the Company shall reduce or eliminate the Payments by (i) first reducing or eliminating those payments or benefits which are payable in cash and (ii) then reducing or eliminating non-cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the furthest in time from the Change in Control. Any notice given by Participant pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing Participant’s rights and entitlements to any benefits or compensation. 

 

  

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SECTION 7

 

SUCCESSORS TO COMPANY

 

 This Policy shall bind any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, in the same manner and to the same extent that the Company would be obligated under this Policy if no succession had taken place. In the case of any transaction in which a successor would not by the foregoing provision or by operation of law be bound by this Policy, the Company shall require such successor expressly and unconditionally to assume and agree to perform the obligations of the Company under this Policy, in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

 

 

 

SECTION 8

 

DURATION, AMENDMENT AND PLAN TERMINATION

 

 8.1 Duration. This Policy shall continue in effect until terminated in accordance with Section 8.2. If a Change in Control occurs, this Policy shall continue in full force and effect and shall not terminate or expire until after all Participants who have become or may become entitled as a result of the Change in Control to Equity Severance Benefits, Performance Unit Benefits and/or Cash Severance Benefits hereunder shall have received such payments in full.

 

8.2 Amendment and Termination. Prior to a Change in Control, the Policy may be amended or modified in any respect, and may be terminated, in any such case by the Committee or the Board; provided, however, that no such amendment, modification or termination that would adversely affect the benefits or protections hereunder of any individual who is a Participant as of the date such amendment, modification or termination is adopted shall be effective (i) as to a Participant for whom a Qualifying Separation from Service of the Participant has already occurred; (ii) if a Change in Control occurs within one year after such adoption; or (iii) from or after the occurrence of a Change in Control and for twenty-seven (27) months thereafter.  Any attempted amendment, modification or termination within one year prior to a Change in Control that would adversely affect the benefits or protections hereunder will be null and void ab initio as it relates to all such individuals who were Participants prior to such adoption (it being understood, however, that the hiring, termination of employment, promotion or demotion of any employee of the Company or any of its Affiliates prior to a Change in Control shall not be construed to be an amendment, modification or termination of the Policy).  Any amendment, modification or termination that accelerates the payment of any benefit hereunder shall be deemed to not adversely affect the benefits or protections hereunder of any individual.

 

 8.3 Form of Amendment. The form of any amendment or termination of the Policy in accordance with Section 8.2 hereof shall be a written instrument approved by the Committee or the Board certifying that the amendment or termination has been approved by the Committee or the Board, respectively.

 

 

  

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SECTION 9

 

MISCELLANEOUS

 

 9.1 Administration.

 

(a) The Policy will be interpreted by the Policy Administrator in accordance with the terms of the Policy and their intended meanings. The Policy Administrator shall have the discretion, in his or her sole judgment, to (i) make any findings of fact needed in the administration of the Policy, (ii) interpret or construe ambiguous, unclear or implied (but omitted) terms, (iii) establish rules and regulations for administering the Policy and (iv) take such other action as he or she deems necessary or appropriate. The validity of any such action or determination by the Policy Administrator will not be given de novo review if challenged in court, by arbitration or any other forum and will be upheld unless clearly arbitrary or capricious. All actions and all determinations made in good faith by the Policy Administrator shall be final, binding and conclusive upon all persons claiming any interest in or under the Policy. Benefits under the Policy will be paid only if the Policy Administrator decides in his or her discretion that a claimant is entitled to them.

 

 (b) The Policy Administrator shall establish a claims procedure in accordance with ERISA and shall set forth such claims procedure in the summary plan description of the Policy.

 

 9.2 Employment Status. This Policy does not constitute a contract of employment or impose on Company any obligation to: (a) retain any Participant as an employee or maintain any compensation level (except as otherwise provided herein), (b) not change the status of any Participant’s employment, (c) not change any employment policies of the Company, or (d) not change or continue the status of any Participant’s employment as an Executive Officer.

 

 9.3 Withholding of Taxes. The Company shall withhold from any amounts payable under this Policy all federal, state, local or other taxes that are legally required to be withheld.

 

 9.4 No Effect on Other Benefits. Equity Severance Benefits, Performance Unit Benefits and Cash Severance Benefits shall not be counted as compensation for purposes of determining benefits under other benefit plans, programs, policies and agreements, except as required by law or to the extent expressly provided therein or herein.

 

 9.5 Validity and Severability. The invalidity or unenforceability of any provision of the Policy shall not affect the validity or enforceability of any other provision of the Policy, which shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

 9.6 Settlement of Claims. The Company’s obligation to make the payments provided for in this Policy and otherwise to perform its obligations hereunder shall not be affected by any circumstances, including, without limitation, any set-off, counterclaim, defense, recoupment, or other right which the Company may have against a Participant or others except as may be specifically permitted by Code Section 409A.

 

 9.7 Unfunded Obligation. All Equity Severance Benefits, Performance Unit Benefits and Cash Severance Benefits provided under this Policy shall constitute an unfunded obligation of the Company.  Cash payments shall be made, as due, from the general funds of the Company. This Policy shall constitute solely an unsecured promise by the Company to provide such benefits to Participants to the extent provided herein. This Policy does not provide the substantive benefits under such other employee benefit plans, and nothing in this Policy shall restrict the Company’s ability to amend, modify or terminate such other employee benefit plans (whether before or after a Change in Control (but subject to Section 2.14 following a Change in Control)).

 

  

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 9.8 Governing Law. It is intended that the Policy be an “employee welfare benefit plan” within the meaning of Section 3(1) of ERISA, and the Policy shall be administered in a manner consistent with such intent. The Policy and all rights thereunder shall be governed and construed in accordance with ERISA and, to the extent not preempted by federal law, with the laws of the state of Arkansas, wherein venue shall lie for any dispute arising hereunder.  In addition, this Policy shall only cover certain employees of the Company who are members of a “select group” of management or highly compensated employees within the meaning of Section 201(2), 301(a)(3), and 401(a)(1) of ERISA.  The Company shall have the authority to take any and all actions necessary or desirable in order for the Policy to satisfy the requirements set forth in ERISA and the regulations thereunder applicable to plans maintained for employees who are members of a select group of management or highly compensated employees.  This Policy shall also be subject to all applicable non-U.S. laws as to Participants employed by subsidiaries of the Company located outside of the United States. Without limiting the generality of this Section 9.9, it is intended that the Policy comply and be interpreted in accordance with Section 409A of the Code, and, the Board shall, as necessary, adopt such conforming amendments as are necessary to comply with Section 409A of the Code without reducing the Equity Severance Benefits, Performance Unit Benefits or Cash Severance Benefits due to Participants hereunder.  Notwithstanding any other provision of this Policy, to the extent applicable, any amendment, modification or termination of the Policy, and the acceleration of any payments hereunder in connection thereto, shall be made in accordance with Code Section 409A and the Treasury Regulations promulgated thereunder, including Treasury Regulation 1.409A-3(j)(4)(ix).

 

 9.9 Assignment. This Policy shall inure to the benefit of and shall be enforceable by a Participant’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. A Participant’s rights under this Policy shall not otherwise be transferable or subject to lien or attachment.

 

 9.10 Enforcement. This Policy is intended to constitute an enforceable contract between the Company and each Participant subject to the terms hereof.

 

 

  

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