Payments and Benefits If an Event occurs during the Term of this Agreement, then the Executive shall be entitled to receive from the Company or its successor (which includes any person acquiring all or substantially all of the assets of the Company) a cash payment and other benefits on the following basis (unless the Executive's employment by the Company is terminated voluntarily or involuntarily before the occurrence of the earliest Event to occur (the "First Event"), in which case the Executive shall be entitled to no payment or benefits under this Section 3):
(a) If at the time of, or at any time after, the occurrence of the First Event and before the end of the Transition Period, the employment of the Executive with the Company is voluntarily or involuntarily terminated for any reason (unless such termination is a voluntary termination by the Executive other than a Constructive Involuntary Termination or is on account of the death or Disability of the Executive or is a termination by the Company for Cause), the Executive (or the Executive's legal representative, as the case may be), subject to the limitations set forth in Sections 3(e) and 3(g),
(1) shall be entitled to receive from the Company or its successor, upon such termination of employment with the Company or its successor, a cash payment in an amount equal to three times the sum of (A) the Executive's then-current annual base salary and (B) the greater of (i) the Executive's annualized then-current year's bonus or (ii) the Executive's annual bonus in the year prior to the then-current year, such payment to be made to the Executive by the Company or its successor in a lump sum at the time of such termination of employment; and
(2) shall be entitled for three years after the termination of the Executive's employment with the Company to participate in any health, disability and life insurance plan or program in which the Executive was entitled to participate immediately before the First Event as if he were an employee of the Company during such three-year period; provided however, that if the Executive's participation in any such health, disability or life insurance plan or program of the Company is barred, the Company, at its sole cost and expense, shall arrange to provide the Executive with benefits substantially similar to those that the Executive would be entitled to receive under such plan or program as if he were not barred from participation.
(b) The payments provided for in this Section 3 shall be in addition to any salary or other remuneration otherwise payable to the Executive on account of employment by the Company or one or more of its subsidiaries or its successor (including any amounts received before such termination of employment for personal services rendered after the occurrence of the First Event) but shall be reduced by any severance pay which the Executive receives from the Company, its subsidiaries or its successor under any other policy or agreement of the Company in the event of involuntary termination of Executive's employment.
(c) The Company shall also pay to the Executive all legal fees and expenses incurred by the Executive as a result of such termination, including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement.
(d) If at any time from the date of the First Event until the end of the Transition Period,
(1) the Executive shall not be given substantially equivalent or greater title, duties, responsibilities and authority, in each case as compared with the Executive's status immediately before the First Event, other than for Cause or on account of Disability;
(2) the Executive's annual base salary or bonus formula shall be reduced from the Executive's annual base salary or bonus formula in effect immediately before the First Event;
(3) the Company shall fail to provide the Executive with benefits under the Company's pension, profit sharing, retirement, life insurance, medical, health and accident, disability, bonus and incentive plans and other employee benefit plans and arrangements that in the aggregate for all such plans and arrangements are at least as favorable to the Executive as those benefits covering the Executive immediately before the First Event or shall fail to provide the Executive with at least the number of paid vacation days to which the Executive was entitled immediately before the First Event;
(4) the Company shall have failed to obtain assumption of this Agreement by any successor as contemplated by Section 5(b) hereof;
(5) the Company shall require the Executive to relocate to any place other than a location within 30 miles of the location at which the Executive performed his primary duties immediately before the First Event or, if the Executive performed such duties at the Company's principal executive offices, the Company shall relocate its principal executive offices to any location other than a location within 30 miles of the location of the principal executive offices immediately before the First Event; or
(6) the Company shall require that the Executive travel on Company business to a substantially greater extent than required immediately before the First Event; then a termination of employment with the Company by the Executive thereafter shall constitute a "Constructive Involuntary Termination."
(e) Notwithstanding any provision of this Agreement to the contrary, except the last sentence of this Section 3(e), if the lump-sum cash payment due and the other benefits to which the Executive shall become entitled under Section 3(a), either alone or together with other payments in the nature of compensation to the Executive that are contingent on a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company or otherwise, would constitute a "parachute payment" as defined in Section 280G of the Code or any successor provision thereto, such lump-sum payment and/or such other benefits and payments shall be reduced (but not below zero) to the largest aggregate amount as will result in no portion thereof being subject to the excise tax imposed under Section 4999 of the Code (or any successor provision thereto) or being non-deductible to the Company for federal income tax purposes pursuant to Section 280G of the Code (or any successor provision thereto). The Executive in good faith shall determine the amount of any reduction to be made pursuant to this Section 3(e) and shall select from among the foregoing benefits and payments those which shall be reduced. No modification of, or successor provision to, Section 280G or Section 4999 after the date of this Agreement shall, however, reduce the benefits to which the Executive would be entitled under this Agreement in the absence of this Section 3(e) to a greater extent than they would have been reduced if Section 280G and Section 4999 had not been modified or superseded after the date of this Agreement, notwithstanding anything to the contrary provided in the first sentence of this Section 3(e).
(f) The Executive shall not be required to mitigate the amount of any payment or other benefit provided for in this Section 3 by seeking other employment or otherwise, nor (except as specifically provided in Section 3(a)(2) or 3(b)) shall the amount of any payment or other benefit provided for in this Section 3 be reduced by any compensation earned by the Executive as the result of employment by another employer after termination, or otherwise.
(g) Notwithstanding any other term of this Agreement, if (1) an Event has not yet occurred, (2) the Board of Directors of the Company desires to cause the Company to effect a transaction that will qualify as a pooling-of-interests transaction (a "Pooling Transaction") and (3) the independent certified public accountants for the Company advise the Board of Directors that they will be unable to render an opinion that such transaction will be treated as a Pooling Transaction solely because of the payments provided for in this Agreement (or in similar agreements with other employees of the Company), then the Executive agrees that upon the happening of any Event in connection with such Pooling Transaction he shall not be entitled to any payments under this Agreement as a result of such Event to the extent such payments would in the opinion of the Company's independent certified public accountants prevent them from providing the Company with a favorable opinion with respect to the treatment of the desired transaction as a Pooling Transaction.
(h) The obligations of the Company under this Section 3 shall survive the termination of this Agreement.
