Common use of Retention Payment Clause in Contracts

Retention Payment. Subject to your compliance with Sections 6 and 7 of this letter agreement, if you remain an active full-time employee of the Company, Parent or any of their respective subsidiaries through the expiration of the 6-month period beginning on the day following the Closing Date (as defined in the Merger Agreement) (the “Vesting Date”), you will receive a cash payment equal to (i) the aggregate amount described in Section 6.2(a) of the Employment Agreement, determined as if your employment with the Company was terminated by the Company without Cause as of the Closing plus (ii) an amount equal to the portion of the premiums the Company would need to pay to provide you with the benefits under Sections 6.2(b) and (c) for the 12 month period following the Vesting Date, based on the premium costs in effect as of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the Retention Bonus. The aggregate of these amounts will be paid to you in a lump sum on the third business day following the Release Effective Date (as defined below). You hereby agree that, notwithstanding anything contained in the Employment Agreement or any other agreement between you and the Company providing for severance or separation payments or benefits, you may either receive payment of amounts set forth in Section 2(a) or in Section 4, but in no event shall you be entitled to receive payment of both amounts; furthermore, you shall not be entitled to any severance or separation payments or benefits under the Employment Agreement (including under Sections 5 and 6 thereof) or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliates, and all of your rights to such payments and benefits under the Employment Agreement and any such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided herein. If you continue to be employed by Parent or its subsidiaries following the Vesting Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiaries, as determined by Parent; provided, however, that you shall not receive credit for your service with Parent or the Company, or any of their respective subsidiaries, for the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefits.

Retention Payment. Subject to your compliance with Sections 6 and 7 of this letter agreement, if you remain an active full-time employee of Provided that Employee remains continuously employed by the Company, Parent or any of their respective subsidiaries Company through the expiration earlier of (i) forty-five (45) days after the 6Change in Control Date, or (ii) September 30, 2024 (the “Retention Period”), the Company shall provide Employee, in a single lump-month period beginning on the day following the Closing Date sum payment, an amount equal to one hundred twenty-five thousand dollars (as defined in the Merger Agreement$125,000) (the “Vesting DateRetention Payment”), you will receive a cash payment equal to (i) less applicable deductions and withholdings, on the aggregate amount described in Section 6.2(a) first normal payroll date that occurs on or after the final day of the Employment month in which the Retention Period ends. For purposes of this Agreement, the date upon which the Change in Control closes shall be referred to as the “Change in Control Date.” When and whether the Company has “closed” a Change in Control shall be determined as if your employment by the release of shares or the cash wires funding the payments for the Change in Control. The Retention Payment will not be earned by Employee until the final day of the Retention Period, subject to Employee remaining employed and complying with Employee’s obligations under this Agreement and the Undertaking during the Retention Period. In the event that the Company terminates Employee’s Employment without Cause or Employee resigns from Employment with the Company was terminated by for Good Reason within twelve (12) months after the Company without Cause as final day of the Closing plus (ii) an amount equal to the portion of the premiums the Company would need to pay to provide you with the benefits under Sections 6.2(b) and (c) for the 12 month period following the Vesting DateRetention Period, based on the premium costs in effect as of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the Retention Bonus. The aggregate Payment shall be deducted from the amount of these amounts will any Severance Benefits to be paid to you in a lump sum on the third business day following the Release Effective Date (as defined belowEmployee under Section 1(g)(i). You hereby agree thatThe provisions of this Section 1 amend, notwithstanding anything contained supersede, replace and terminate in its or their entirety any and all provisions of the Employment Original Agreement that govern or any other agreement between you and the Company providing for severance pertain to, or separation payments or benefits, you may either receive payment of amounts otherwise set forth in Section 2(a) any terms or in Section 4conditions relating to, but in no event shall you be entitled to receive payment any termination of both amounts; furthermore, you shall not be entitled to Employment or any severance or separation payments other payments, or benefits under the Employment Agreement vesting acceleration or other benefits, to which Employee may be eligible (including under Sections 5 and 6 thereofif at all) upon, after or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliates, and all of your rights to such payments and benefits under the Employment Agreement and in connection with any such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided herein. If you continue to be employed by Parent or its subsidiaries following the Vesting Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiaries, as determined by Parent; provided, however, that you shall not receive credit for your service with Parent or the Company, or any of their respective subsidiaries, for the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefitstermination.

Retention Payment. Subject to your compliance with Sections 6 and 7 of this letter agreement, if you remain an active full-time employee of the Company, Parent or any of their respective subsidiaries through the expiration of the 6-month period beginning on the day following the Closing Date (as defined in the Merger Agreement) (the “Vesting Date”), you will receive a cash payment equal to (i) the aggregate amount described in Section 6.2(a7.2(a) of the Employment Agreement, determined as if your employment with the Company was terminated by the Company without Cause as of the Closing plus (ii) an amount equal to the portion of the premiums the Company would need to pay to provide you with the benefits under Sections 6.2(b) and (cSection 7.2(b) for the 12 month period following the Vesting Date, based on the premium costs in effect as of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the Retention Bonus. The aggregate of these amounts will be paid to you in a lump sum on the third business day following the Release Effective Date (as defined below). You hereby agree that, notwithstanding anything contained in the Employment Agreement or any other agreement between you and the Company providing for severance or separation payments or benefits, you may either receive payment of amounts set forth in Section 2(a) or in Section 4, but in no event shall you be entitled to receive payment of both amounts; furthermore, you shall not be entitled to any severance or separation payments or benefits under the Employment Agreement (including under Sections 5 6 and 6 7 thereof) or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliates, and all of your rights to such payments and benefits under the Employment Agreement and any such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided herein. If you continue to be employed by Parent or its subsidiaries following the Vesting Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiaries, as determined by Parent; provided, however, that you shall not receive credit for your service with Parent or the Company, or any of their respective subsidiaries, for the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefits.

Retention Payment. (a) If you remain an active full-time employee of the Company, Parent or any of their respective Affiliates through the first anniversary of the Closing, you will receive cash payments equal to (i) the Severance Amount, determined as if your employment with the Company was terminated by the Company without Cause as of the Closing, which will be paid to you in a lump sum on the third business day following the first anniversary of the Closing plus (ii) subject to your compliance with Section 7 of this Agreement, an amount equal to $1,150,500 (the “First Retention Payment”), which will be paid to you in a lump sum on the third business day following the applicable Release Effective Date (as defined below). (b) Subject to your compliance with Sections 6 and Section 7 of this letter agreementAgreement, if you remain an active full-time employee of the Company, Parent or any of their respective subsidiaries Affiliates through the expiration of the 6-month period beginning on the day following the Closing Date (as defined in the Merger Agreement) (the “Vesting Transition Date”), you will receive a cash payment equal to $1,100,000 (i) the aggregate amount described in Section 6.2(a) of the Employment Agreement, determined as if your employment with the Company was terminated by the Company without Cause as of the Closing plus (ii) an amount equal to the portion of the premiums the Company would need to pay to provide you with the benefits under Sections 6.2(b) and (c) for the 12 month period following the Vesting Date, based on the premium costs in effect as of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the “Second Retention BonusPayment”). The aggregate of these amounts Second Retention Payment will be paid to you in a lump sum on the third business day following the applicable Release Effective Date Date. (as defined below). c) You hereby agree that, notwithstanding anything contained in the Employment CIC Agreement or any other agreement between you and the Company providing for severance or separation payments or benefits, the aggregate payments you may either receive payment of amounts set forth under this Agreement shall not exceed $3,500,000 (other than, in Section 2(a) or in Section 4, but in no the event shall you be are entitled to receive payment the Termination Compensation, any compensation or benefits under Section 6(d) of both amountsthe CIC Agreement that are in excess of the Severance Amount); furthermore, you shall not be entitled to any severance or separation payments or benefits under the Employment CIC Agreement (including under Sections 5 and 6 Section 6(d) thereof) or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliatesAffiliates applicable to you currently or at the time of Closing (excluding, and all for the avoidance of doubt, your rights to such payments under Sections 8 and benefits under 9 of the Employment CIC Agreement). Notwithstanding the generality of the foregoing, the CIC Agreement shall terminate and be of no further effect upon the first anniversary of the Closing (other than Sections and 9 of the CIC Agreement and any other provisions necessary to give effect to and enforce such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided hereinsection). If you continue to be employed by Parent or and its subsidiaries Affiliates following the Vesting Transition Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiariesAffiliates, as determined by Parent; provided, however, that you shall not receive credit for your service with Parent or the Company, or any of their respective subsidiaries, for the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefitsin good faith.

Retention Payment. (a) Subject to your compliance with Sections 6 Section 5, you shall receive a payment (the “Retention Payment”) equal to $1.1 million, less all applicable taxes and 7 of this letter agreementwithholdings, if so long as you remain an active full-time employee employed in the role of Executive Chairman through September 30, 2015; provided that such date (i) may be extended to no later than December 31, 2015 by the CompanyCompany if the Company is in the midst of a process (e.g., Parent negotiations on a letter of intent, term sheet or any of their respective subsidiaries through the expiration of the 6-month period beginning on the day following the Closing Date purchase or merger agreement) with a potential acquirer that may result in a Change in Control (as defined below) and (ii) shall be accelerated to (A) the date on which the Company executes a definitive agreement that contemplates a transaction that, if consummated, would result in a Change in Control or (B) the date on which a Board Change (as defined below) occurs or (C) thirty (30) days after the Board determines to terminate the strategic review process, whichever is earlier. (b) Notwithstanding the foregoing, in the Merger Agreement) (the “Vesting Date”), you will receive a cash payment equal to (i) the aggregate amount described in Section 6.2(a) of the Employment Agreement, determined as if event that your employment with ends earlier than September 30, 2015 (or the Company was terminated extended date pursuant to Section 3(a)(i)) as a result of a termination by the Company without Cause as Cause, your death or Disability, you shall be entitled to the Retention Payment. (c) Subject to Sections 5 and 18(b), the Retention Payment shall be paid within sixty (60) days of the Closing plus Departure Date, except in the event that the termination occurs as a result of a Board Change in which event the Retention Payment will be made in a manner consistent with the Executive Severance Agreement dated March 2010 between you and Town Sports International, LLC (iithe “Prior Agreement”) an amount equal to the as follows: (i) that portion of the premiums Retention Payment equal to that portion of severance under the Company Prior Agreement that would need to pay to provide you with the benefits under Sections 6.2(b) and (c) for the 12 month period following the Vesting Date, based on the premium costs in effect as have been exempt from Section 409A of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the Retention Bonus. The aggregate of these amounts will Code shall be paid to you in a lump sum on within sixty (60) days of the third business day following Departure Date and (ii) the Release Effective Date (remainder will be paid in monthly installments as defined below). You hereby agree that, notwithstanding anything contained provided in the Employment Prior Agreement or and, if applicable, subject to the six (6) month delay described in that Prior Agreement and Section 18(b) below. (d) In the event of any other agreement between you and termination, including a resignation or a termination by the Company providing for severance or separation payments or benefits, you may either receive payment of amounts set forth in Section 2(a) or in Section 4, but in no event shall you be entitled to receive payment of both amounts; furthermorewith Cause, you shall not be entitled to any severance or separation payments or benefits under the Employment Agreement (including under Sections 5 and 6 thereof) or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliates, and all of your rights to such payments and benefits under the Employment Agreement and any such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided herein. If you continue to be employed by Parent or its subsidiaries following the Vesting Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiaries, as determined by Parent; provided, however, that you shall not receive credit for your service with Parent Retention Payment or the Company, or any of their respective subsidiaries, for other benefits described in Section 6 below (the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefits“Transition Benefits”).

Retention Payment. Subject In consideration for this Agreement and the mutual covenants and promises contained herein, including the Employee’s agreement to your compliance with Sections 6 be bound by the restrictive covenants set forth in Paragraphs 11 and 7 12 of this letter agreementAgreement, if you remain an active full-time employee the Company shall pay or cause to be paid to the Employee on the first anniversary of the CompanyEffective Time, Parent or any of their respective subsidiaries through the expiration of the 6-month period beginning on the day following the Closing Date (as defined in the Merger Agreement) $2,605,649 (the “Vesting DateRetention Payment”), you will receive a cash payment equal to (i) the aggregate amount described in Section 6.2(a) of the Employment Agreement, determined as if your employment with the Company was terminated by the Company without Cause as of the Closing plus (ii) an amount equal to the portion of the premiums the Company would need to pay to provide you with the benefits under Sections 6.2(b) and (c) for the 12 month period following the Vesting Date, based on the premium costs in effect as of the Closing and assuming for this purpose that your employment terminated on the Vesting Date and that you timely elected to receive all such benefits, plus (iii) the Retention Bonus. The aggregate of these amounts will be paid to you in a lump sum on the third business day following the Release Effective Date (as defined below). You hereby agree that, notwithstanding anything contained in the Employment Agreement or any other agreement between you and the Company providing for severance or separation payments or benefits, you may either receive payment of amounts set forth in Section 2(a) or in Section 4, but in no event shall you be entitled to receive payment of both amounts; furthermore, you shall not be entitled to any severance or separation payments or benefits under the Employment Agreement (including under Sections 5 and 6 thereof) or under any other plan, program, policy, agreement or arrangement maintained by the Company, Parent or any of their respective affiliates, and all of your rights to such payments and benefits under the Employment Agreement and any such other plan, program, policy, agreement or arrangement will immediately terminate, in each case, except as otherwise provided herein. If you continue to be employed by Parent or its subsidiaries following the Vesting Date, you shall be eligible for severance benefits under either the applicable severance policy of Parent or one of its subsidiaries, as determined by Parent; provided, however, that you the Retention Payment shall not receive credit for your be subject to the Employee’s continued employment and service to the Company through the first anniversary of the Effective Time. Within five (5) business days of the Effective Time, the Company shall pay to a grantor (“rabbi”) trust of which the Employee is the sole beneficiary (subject to the claims of the Company’s creditors, as required pursuant to applicable Internal Revenue Service guidance to prevent the imputation of income to the Employee prior to distribution from the trust) the Retention Payment. The parties agree that the amount of the Retention Payment is an estimated amount based on certain reasonable assumptions with Parent respect to the projected cost of various types of insurance coverage and certain other benefits. The parties agree that the amount of the Retention Payment will be adjusted immediately prior to the Effective Time as necessary and mutually agreed to by the parties to take into account changes in the applicable IRS discount rate and any changes in the insurance premiums or the Companycosts of such other benefits prior to the Effective Time. Notwithstanding the foregoing or anything contained herein to the contrary, if the Employee’s employment ceases due to a termination by the Company without Cause, a resignation by the Employee due to an Adverse Change, the Employee’s Disability, or the Employee’s death, the Retention Payment shall be paid in a lump sum within 60 days of the Employee’s termination date, subject to a six-month delay as described in Subparagraph 7.1.6 which may be required under section 409A of the Code. In addition, the parachute tax gross-up provision of Section 6(c) of the Existing Agreement shall apply with respect to any excise tax imposed on the Employee under Code section 4999 as a result of their respective subsidiaries, the Merger; provided that any parachute tax gross-up payment hereunder shall be paid no later than the end of the calendar year next following the calendar year in which the Employee or Company (as applicable) remits the taxes for which the periods of employment that precede the Closing Date for any purpose under such policy, including eligibility, vesting or calculation of benefitsparachute tax gross-up payment is being made.