AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
This AMENDED AND
RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) dated
as of the 15th day of July 2008, between Barr Laboratories, Inc., a
Delaware corporation having its principal executive offices at 225
Summit Avenue, Montvale, New Jersey 07645-1523 (the “
Company ”), and Christine A. Mundkur (the “
Employee ”).
WHEREAS, the
Company and the Employee entered into an employment agreement dated
as of February 1, 2001, which was amended and restated as of
February 19, 2003 and August 19, 2005 (as so amended and
restated, the “ Prior Agreement ”);
WHEREAS, the
Company and the Employee wish to amend and restate the Prior
Agreement;
WHEREAS, the
Company wishes to assure itself of the services of the Employee and
provide an inducement for the Employee to remain in its employ;
and
WHEREAS, the
Employee is willing to remain in the employ of the Company on the
terms and conditions hereafter set forth.
NOW, THEREFORE,
the Company and the Employee hereby agree that, effective as of the
date first stated above, the Prior Agreement is amended and
restated in its entirety to read as follows:
1. Employment.
The Company agrees to employ the Employee, and the Employee agrees
to serve in the employ of the Company, during the term of this
Agreement on the terms and conditions hereafter set
forth.
2. Term. The
term of this Agreement shall commence on July 15th, 2008 (the
“ Commencement Date ”) and shall terminate at 5
P.M. (E.S.T.) on December 31, 2009 unless sooner terminated in
accordance with the terms of this Agreement or extended as
hereinafter provided. The term of this Agreement shall be extended,
without further action by the Company or the Employee, on the date
(the “ Extension Effective Date ”) that is six
(6) months before December 31, 2009 and on the date (also
an “ Extension Effective Date ”) that is six
(6) months before each subsequent December 31, for
successive periods of twelve (12) months each, unless the
Company, BPI or an Affiliate shall have given written notice to the
Employee, or the Employee shall have given written notice to the
Company, in the manner set forth in paragraph 13(e) or
(f) below, prior to the Extension Effective Date in question,
that the term of this Agreement that is in effect at the time such
written notice is given is not to be extended or further extended,
as the case may be.
3.
Position and Responsibilities; Place of Performance
.
(a) Throughout
the term of this Agreement, the Employee agrees to serve in the
employ of the Company, and the Company agrees to employ the
Employee, as its Chief Executive Officer, reporting to the Chief
Executive Officer of BPI (the “ CEO ”). As the
Company’s Chief Executive Officer, the Employee shall be the
most senior officer of the
Company and
shall have effective supervision, control and policy-making
authority over, and responsibility for, the strategic direction and
general leadership and management of the business and affairs of
the Company, including, without limitation, all aspects of its
global generics business, including strategic planning, research
and development, regulatory affairs, operations, quality, and sales
and marketing, and shall provide leadership for the Company to
continue to support the proprietary business in the areas of
formulation, regulatory affairs, and product supply, subject only
to the authority of the CEO and the Board of Directors of BPI (the
“ Board ”), and shall have all of the powers,
authority, duties and responsibilities usually incident to the
position and role of Chief Executive Officer in companies that are
comparable in size, character and performance to the
Company.
(b) In
connection with the Employee’s employment by the Company, the
Employee shall be based at the principal executive offices of the
Company in the greater New York City metropolitan area, including
Montvale, New Jersey, and the Employee agrees to travel, to the
extent reasonably necessary to perform the Employee’s duties
and obligations under this Agreement, to Company facilities and
other destinations elsewhere at the Company’s
expense.
(c) During
the term of this Agreement, the Employee shall serve the Company on
an exclusive basis (it being understood that the Employee’s
engaging in activities on behalf of BPI or an Affiliate shall be
deemed serving the Company for this purpose) and shall devote all
the Employee’s business time, attention, skill and efforts to
the faithful performance of the Employee’s duties hereunder;
provided that the Employee may engage in community service and
charitable activities or such other activities as approved by the
CEO and the Board that do not materially interfere with the
performance of the Employee’s duties and responsibilities
hereunder.
4.
Compensation . For all services rendered by the Employee in
any capacity during the term of this Agreement, and for the
Employee’s undertakings with respect to confidential
information, non-solicitation and disparaging remarks set forth in
Sections 6 and 7 below, the Employee shall be entitled to the
following:
(a) a
salary, payable in installments not less frequent than monthly, at
the annual rate of seven hundred thousand dollars ($700,000), with
such increases in such rate, if any, as the Board or a committee of
the Board may approve from time to time during the term of this
Agreement in accordance with the Company’s regular
administrative practices applicable to senior officers from time to
time during the term of this Agreement (the Employee’s annual
salary rate as increased from time to time during the term of this
Agreement being hereafter referred to as the “ Base
Salary ”);
(b) participation
in the Company’s annual executive incentive or bonus plan as
in effect from time to time, with the opportunity to receive, for
each fiscal year of the Company that begins or ends during the term
of this Agreement, a target award of seventy-five percent (75%) of
the Base Salary earned during such year (or such higher amount as
the Board or a committee of the Board may determine, in its
discretion, up to a maximum of the lesser of (i) one hundred
percent (100%) of Base Salary earned during such year or
(ii) three percent (3%) of the Company’s pre-tax and
pre-bonus net operating income for such year), in accordance with
the terms and conditions of such incentive or bonus plan, it being
understood that any award for the
- 2 -
fiscal year of
the Company in which the term of this Agreement terminates pursuant
to the terms hereof shall be prorated based on the portion of such
fiscal year that coincides with the term of this Agreement and
shall be made at the same time as awards (if any) are made to other
participants with respect to such fiscal year. The Company will pay
the Employee’s annual incentive bonus for each year at the
same time as annual incentive bonus payments for such year (if any)
are made to other participants with respect to such fiscal year,
and in all events within the two and one half (2
1 / 2
) months following the end of the
calendar year in which the bonus is earned. Annual incentive
bonuses are intended to qualify for the short-term deferral
exception to Section 409A of the Internal Revenue Code of
1986, as amended (the “ Code ”);
(c) participation
in the stock incentive plan applicable to Company officers as from
time to time in effect, subject to the terms and conditions of such
plan;
(d) the
business and personal use of an automobile at Company expense
including, without limitation, payment or reimbursement of
automobile insurance and maintenance expenses, or a cash allowance
in lieu thereof, in accordance with the Company’s automobile
policy applicable to similarly situated senior officers;
and
(e) participation
in all health, welfare, savings and other employee benefit and
fringe benefit plans (including vacation pay plans or policies and
life and disability insurance plans) in which other senior officers
of the Company participate during the term of this Agreement,
subject in all events to the terms and conditions of such plans as
in effect from time to time. Nothing in this paragraph
(e) shall preclude the Company, BPI or an Affiliate from
amending or terminating any such plan at any time prior to a Change
in Control or Potential Change in Control. The plans covered by
this paragraph (e) shall not include the annual incentive or
stock incentive plans, which are covered by paragraphs (b) and
(c) above.
5.
Termination of Employment .
(a)
Termination by the Company, BPI or an Affiliate without Good
Cause or by the Employee for Good Reason; Non-Renewal
Termination .
(i) If the
Employee’s employment with the Company is terminated by the
Company, BPI or an Affiliate without Good Cause (except as an
incident of assigning the rights to Employee’s services to a
Permitted Assignee in accordance with paragraph 13(d) below) when
the Employee is willing and able to continue performing service, or
is terminated by the Employee for Good Reason, in either case
during the term of this Agreement and other than at the expiration
of the term of this Agreement as the same may have been extended in
accordance with the provisions of Section 2 above (any such
employment termination being hereafter referred to as a “
Compensable Termination ”), the Company shall pay the
Employee, in accordance with normal payroll practices, the portion
of the Employee’s Base Salary accrued through the date of the
Compensable Termination and any other amounts to which the Employee
is entitled by law or pursuant to the terms of any compensation or
benefit plan or arrangement in which the Employee participated
prior to the Compensable Termination and, in addition, subject to
all of the provisions of this Section 5, Section 14 below, and
further subject to compliance by the Employee with the provisions
of Sections 6 and 7 below, relating to confidential information,
non-solicitation and disparaging remarks, the Company shall, as
liquidated
- 3 -
damages or
severance pay or both (whichever characterization(s) will serve to
validate the payments), and as additional consideration for the
Employee’s undertakings under Sections 6 and 7 below,
pay the Employee the following:
(A) the
Employee’s annual bonus for the fiscal year of the Company
preceding the fiscal year of the Company in which the Compensable
Termination occurs, if unpaid at the time of the Compensable
Termination. Such annual bonus shall be paid at the same time as
bonuses (if any) for such preceding fiscal year are paid to other
officers, and in all events within the first two and one half
(2 1
/ 2 ) months
of the fiscal year in which the Compensable Termination occurs. The
amount of such bonus shall be determined by the Board or a
committee of the Board on a basis consistent with the prior bonus
determinations with respect to the Employee or, in the event a
Change in Control or Potential Change in Control (as defined in
Section 11 below) occurred before the Compensable Termination,
consistent with the bonus determinations with respect to the
Employee prior to the Change in Control or Potential Change in
Control. If the Board or a committee of the Board made no bonus
determinations with respect to the Employee before the Compensable
Termination or, if applicable, before the Change in Control or
Potential Change in Control, the amount of such bonus shall be
determined on a basis consistent with the Board’s or Board
committee’s bonus determinations with respect to other senior
officers of the Company before the Compensable Termination or, if
applicable, before the Change in Control or Potential Change in
Control; and
(B) a prorated
annual bonus for the fiscal year of the Company in which the
Compensable Termination occurs, payable at the same time as bonuses
(if any) for such fiscal year are paid to other officers, and in
all events within the first two and one half (2
1 / 2
) months of the fiscal year
following the fiscal year in which the Compensable Termination
occurs. Such prorated annual bonus shall be determined by
multiplying the “Applicable Average Bonus” as defined
below in this subparagraph 5(a)(i)(B) by a fraction, the numerator
of which shall be the number of days elapsed in such fiscal year
through (and including) the date on which the Compensable
Termination occurs and the denominator of which shall be the number
three hundred sixty-five (365). For purposes of this Agreement, the
“ Applicable Average Bonus ” means the highest
of (I) the average annual bonus (including any portion of the
bonus that is deferred) awarded to the Employee during the three
(3)-year period immediately preceding the Compensable Termination
or, if the Employee was employed by the Company for less than three
(3) years before the Compensable Termination, during the
period of the Employee’s employment by the Company prior to
the Compensable Termination (annualizing any bonus awarded for less
than a full year of employment), (II) the average annual bonus
(including any portion of the bonus that is deferred) awarded to
the Employee during the three (3) fiscal years of the Company
that precede the fiscal year in which the Compensable Termination
occurs or during the portion of such three (3) fiscal years in
which the Employee was employed by the Company (annualizing any
bonus awarded for less than a full year of employment); provided
that, if the Compensable Termination occurs
- 4 -
after a Change
in Control or Potential Change in Control, the Applicable Average
Bonus shall not be less than the average annual bonus (including
any portion of the bonus that is deferred) awarded to the Employee
during the three (3) years preceding the date on which the
Change in Control or Potential Change in Control occurred or during
the portion of such three (3) years in which the Employee was
employed by the Company (annualizing any bonus awarded for less
than a full year of employment); or (III) the Employee’s
target bonus (based on the greatest of (i) the
Employee’s target bonus percentage and Base Salary rate as
specified in Section 4 above, (ii) the Employee’s
approved target bonus percentage and Base Salary rate in effect on
the date of the Compensable Termination, or (iii) the
Employee’s approved target bonus percentage and Base Salary
rate in effect on the date of notice of such Compensable
Termination, whichever is greater); and
(C) an amount of
money (the “ Severance Payment ”) equal to three
(3) times the Employee’s “Annual Cash
Compensation” as hereafter defined, unless the Severance
Payment is payable solely on account of the Employee’s
resignation for Good Reason pursuant to subparagraph 5(d)(v) below
(relating to the Company, BPI or an Affiliate giving the Employee
notice of non-extension), in which case the Severance Payment shall
be equal to one and one-quarter (1 1 / 4
) times the Employee’s
“Annual Cash Compensation” as hereafter defined. Except
as otherwise provided hereafter in this subparagraph 5(a)(i)(C) and
Section 14, seventy-five percent (75%) of the Severance
Payment shall be paid in a lump sum within ten (10) days after
the date of the Compensable Termination. The twenty-five percent
(25%) balance of the Severance Payment shall be paid in six
(6) equal monthly installments, one (1) of which shall be
paid at the end of each of the first six (6) months after the
date of the Compensable Termination, provided, in the case of each
of such six (6) installments, that the Employee has not accepted
full-time or regular part-time employment with or regularly served
as a consultant to a for-profit pharmaceutical company prior to the
date for payment of such installment, it being understood and
agreed that the foregoing condition shall not be violated by the
Employee’s serving as a member of a board of directors of a
for-profit pharmaceutical company or by his/her performing
consulting services on an ad hoc basis for such a
company. If a Change in Control occurs that is a “change in
control event” within the meaning of Code Section 409A
and Treasury Regulation §1.409A-3(i)(5)(i) (or any similar or
successor provisions) (either before or after the Compensable
Termination and in accordance with Treasury Regulation
§1.409A-3(c)), the Severance Payment (or, in the case of such
a “change in control event” that occurs after the
Compensable Termination, any portion thereof that remains unpaid at
the time such “change in control event” occurs) shall
be paid in a lump sum within ten (10) days after the
Compensable Termination (or, in the case of such a “change in
control event” that occurs after the Compensable Termination,
within ten (10) days after the “change in control
event” occurs), and the two (2) preceding sentences of
this subparagraph shall not apply. For thirty-six (36) months
following a Compensable Termination, the Company shall also provide
the Employee (and, as applicable, the Employee’s covered
dependents), at Company expense, with continuation coverage under
the Company’s group health plan(s) covering similarly
situated executives. For
- 5 -
purposes of
this Section 5, the Employee’s “ Annual Cash
Compensation ” shall mean the sum of (I) the
Employee’s highest Base Salary ( i.e., one
(1) year’s salary at its highest rate), plus
(II) the “Applicable Average Bonus” as defined in
subparagraph 5(a)(i)(B) above.
(ii) If the term
of this Agreement as the same may have been extended in accordance
with the provisions of Section 2 above is not extended or
further extended because the Company, BPI or an Affiliate gives
written notice of non-extension to the Employee as provided in
Section 2 above, and there is not Good Cause for termination
of the Employee’s employment at the time of giving such
notice, and the Employee does not thereafter resign for Good Reason
during the term of this Agreement as permitted by paragraph 5(d)(v)
below, and the Employee is willing and able to renew or execute a
new agreement providing terms and conditions substantially similar
to those in this Agreement and to continue providing such services,
then the Company shall pay the Employee, subject to fulfillment by
the Employee of the Employee’s obligations under this
Agreement during the balance of the term and the Employee’s
compliance with the provisions of Sections 6 and 7 below,
relating to confidential information, non-solicitation and
disparaging remarks, as non-renewal compensation, and as additional
consideration for the Employee’s undertakings under this
Agreement, including Sections 6 and 7 below, an amount of
money (the “ Non-Renewal Payment ”) equal to one
and one quarter (1 1 / 4
) times the Employee’s Annual
Cash Compensation as defined in subparagraph 5(a)(i)(C) above, in
addition to any other amounts to which the Employee may be entitled
hereunder (including without limitation the Employee’s annual
bonus pursuant to paragraph 4(b) above for the fiscal year of the
Company in which the Employee’s employment terminates and any
amounts to which the Employee may be entitled under Section 8,
9 or 10 below) or by law or pursuant to the terms of any
compensation or benefit plan or arrangement in which the Employee
participated before the Employee’s employment terminated.
Except as otherwise provided hereafter in this subparagraph
5(a)(ii), seventy-five percent (75%) of the Non-Renewal Payment
shall be paid in a lump sum within ten (10) days after the
date on which the Employee’s employment terminates, subject
to paragraph 5(f) and Section 14. The twenty-five percent
(25%) balance of the Non-Renewal Payment shall be paid in six
(6) equal monthly installments one (1) of which shall be
paid at the end of each of the first six (6) months after the
date on which the Employee’s employment terminates. If a
Change in Control occurs that is a “change in control
event” within the meaning of Code Section 409A and
Treasury Regulation §1.409A-3(i)(5)(i) (or any similar or
successor provisions) (either before or after the Employee’s
termination and in accordance with Treasury Regulation
§1.409A-3(c)), the Non-Renewal Payment (or, in the case of
such a “change in control event” that occurs after the
Employee’s termination, any portion thereof that remains
unpaid at the time such “change in control event”
occurs) shall be paid in a lump sum within ten (10) days after
the date on which the Employee’s employment terminates (or,
in the case of such a “change in control event” that
occurs after the Employee’s termination, within ten
(10) days after the “change in control event”
occurs), and the two (2) preceding sentences of this
subparagraph shall not apply. For thirty-six (36) months following
the Employee’s termination, the Company shall also provide
the Employee (and, as applicable, the Employee’s covered
dependents), at
- 6 -
Company
expense, with continuation coverage under the Company’s group
health plan(s) covering similarly situated executives.
(iii) The
foregoing provisions of (including any payments under) this
paragraph 5(a) shall be in lieu of any severance pay that may be
payable under any plan or practice of the Company, any other
Subsidiary or Affiliate, or BPI (as such terms are defined in
Section 11 below), or by law (including the WARN Act or any
similar state or foreign law), but shall be in addition to (and not
in lieu of) any payments to which the Employee may be entitled
under Sections 8, 9 and 10 below. Subparagraphs 5(a)(i)(C) and
5(a)(ii) above are intended to be mutually exclusive, and in no
event shall such subparagraphs, either individually or
collectively, be construed to require the Company to pay an amount
of money in excess of three (3) times the Employee’s
Annual Cash Compensation under such subparagraphs, either
individually or collectively, in addition to continuation coverage
under the Company’s group health plan(s) covering similarly
situated executives provided by the Company to the Employee (and,
as applicable, the Employee’s covered dependents), at Company
expense, for thirty-six (36) months.
(iv) The Employee
shall not be required to mitigate the amount of any payment or
benefit provided for in this Agreement (including but not limited
to any payment provided for above in this paragraph 5(a)) by
seeking other employment or otherwise, nor shall any compensation
earned by the Employee in other employment or otherwise reduce the
amount of any payment or benefit provided for in this Agreement,
except as provided in subparagraphs 5(a)(i)(C) and 5(a)(ii)
above.
(v) A Compensable
Termination shall not include a termination of employment by reason
of the Employee’s death.
(b)
Termination by the Company, BPI or an Affiliate for Good Cause
or by the Employee without Good Reason . If, during the term of
this Agreement, the Employee’s employment by the Company is
terminated by the Company, BPI or an Affiliate for Good Cause or by
the Employee without Good Reason, the Employee shall not be
entitled to receive any compensation under Section 4 above
accruing after the date of such termination or any payment under
paragraph 5(a) above. However, any obligations of the Company under
Sections 8, 9 and 10 shall not be affected by such termination
of employment. The provisions of this paragraph 5(b) shall be in
addition to, and not in lieu of, any other rights and remedies the
Company may have at law or in equity or under any other provision
of this Agreement in respect of such termination of employment.
However, if during the term of this Agreement the Employee’s
employment is terminated by the Employee without Good Reason and
the Employee gives the Company at least one hundred twenty
(120) days’ advance notice of such termination, then the
Employee shall not have any obligation or liability under this
Agreement on account of such termination of employment, but the
Employee’s obligations under Section 6 and 7 hereof
shall not be affected by such termination of employment.
(c)
Good Cause Defined . For purposes of this Agreement, the
Company, BPI and the Affiliates shall have “ Good
Cause ” to terminate the Employee’s employment by
the Company during the term of this Agreement only if:
- 7 -
(i) (A) the
Employee fails to substantially perform the Employee’s duties
hereunder for any reason or to devote substantially all the
Employee’s business time exclusively to the affairs of the
Company (including Company activities on behalf of the other
Affiliates or BPI), other than by reason of a medical condition
that prevents the Employee from substantially performing the
Employee’s duties hereunder even with a reasonable
accommodation by the Company, and (B) such failure is not
discontinued within a reasonable period of time, in no event to
exceed thirty (30) days, after the Employee receives written
notice from the Company, BPI or an Affiliate of such failure;
or
(ii) the Employee
commits an act of dishonesty resulting or intended to result
directly or indirectly in gain or personal enrichment at the
expense of the Company, BPI or an Affiliate, or engages in conduct
that constitutes a felony in the jurisdiction in which the Employee
engages in such conduct; or
(iii) the Employee
is grossly negligent or engages in willful misconduct or
insubordination in the performance of the Employee’s duties
hereunder; or
(iv) the Employee
materially breaches the Employee’s obligations under
Section 6 or paragraph 7(a) below, relating to confidential
information and non-solicitation.
In addition, the
Employee’s employment shall be deemed to have terminated for
Good Cause if, after the Employee’s employment has
terminated, facts and circumstances arising during the course of
the Employee’s employment are discovered that would have
justified a termination for Good Cause under subparagraphs 5(c)(ii)
or (iv) above.
Any foregoing
provision of this paragraph 5(c) to the contrary notwithstanding,
the Company, BPI and the Affiliates shall not have “Good
Cause” to terminate the Employee’s employment within
three (3) years after a Change in Control or Potential Change
in Control (as such terms are defined in Section 11 below)
unless (A) the Employee’s act or omission is willful and
has a material adverse effect upon the Company or BPI, (B) the
Board gives the Employee (I) written notice warning of its
intention to terminate the Employee for Good Cause if the specified
act or omission alleged to constitute Good Cause is not
discontinued and, if curable, cured, and (II) a reasonable
opportunity after receipt of such written notice, but in no event
less than two (2) weeks, to discontinue and, if curable, cure
the conduct alleged to constitute Good Cause, and (C) the
Employee fails to discontinue and, if curable, cure the act or
omission in question; provided that clauses (B) and
(C) of this sentence shall not apply with respect to conduct
on the part of the Employee that constitutes a felony in the
jurisdiction in which the Employee engages in such conduct, and,
provided further, that this sentence shall not apply to conduct
involving moral turpitude. For all purposes of this Agreement, no
act, or failure to act, on the Employee’s part shall be
deemed “willful” unless done, or omitted to be done, by
the Employee intentionally and in bad faith ( i.e. , without
reasonable belief that the Employee’s action or omission was
in furtherance of the interests of the Company, BPI or a Subsidiary
or Affiliate).
(d)
Good Reason Defined . For purposes of this Agreement, the
Employee shall have “ Good Reason ” to terminate
employment during the term of this Agreement only if:
- 8 -
(i) the Company
fails to pay or provide any amount or benefit that the Company is
obligated to pay or provide under Section 4 above or
Section 8, 9, or 10 below and the failure is not remedied
within thirty (30) days after the Company receives written
notice from the Employee of such failure; or
(ii) the Employee
is assigned duties, responsibilities, or reporting relationships
not contemplated by Section 3 above without the
Employee’s consent, or the Employee’s duties or
responsibilities or power or authority contemplated by
Section 3 above are limited in any respect materially
detrimental to the Employee, and in either case the situation is
not remedied within thirty (30) days after the Company
receives written notice from the Employee of the situation;
or
(iii) the Employee
is removed from, or not elected or reelected to, the office, title
or position of Chief Executive Officer of the Company, and the
Company, BPI and the Affiliates do not have Good Cause for doing
so; or
(iv) the Company,
BPI or an Affiliate relocates the Employee’s office outside
of either the Company’s principal executive offices or the
greater New York City metropolitan area without the
Employee’s written consent (given in a personal rather than
representative capacity) and the situation is not remedied within
thirty (30) days after the Company receives written notice
from the Employee of the situation; or
(v) the Company,
BPI or an Affiliate gives the Employee written notice, in the
manner set forth in paragraph 13(f) below, prior to any Extension
Effective Date, that the term of this Agreement that is in effect
at the time such written notice is given is not to be extended or
further extended, as the case may be; provided that the giving of
such written notice to the Employee shall constitute Good Reason
only if and when the Employee shall have performed such of the
Employee’s duties and responsibilities for such period of
time, in no event to exceed ninety (90) days after the giving
of such notice, as the CEO or the Board may reasonably request in
writing to transition the Employee’s duties and
responsibilities; or
(vi) a Change in
Control occurs and as a result thereof either (A) equity
securities of BPI cease to be publicly-traded, or (B) the
Employee is not elected or designated to serve as the sole Chief
Executive Officer of the Company or its survivor in the Change in
Control; or
(vii) a Change in
Control or Potential Change in Control occurs and (A) the
dollar value of the stock optioned to the Employee annually
thereafter is less than the average annual dollar value of the
stock that was optioned to the Employee during the four
(4) years prior to the Change in Control or Potential Change
in Control, or (B) the material terms of such options
(including without limitation vesting schedules) are less favorable
to the Employee than the material terms of the options that were
granted to the Employee during the four (4) years prior to the
Change in Control or Potential Change in Control, and in either
case (A) or (B) the situation is not remedied within
thirty (30) days after the Company receives written notice
from the Employee of the situation. For purposes of (A) and
(B) of this subparagraph 5(d)(vii), if free-standing stock
appreciation rights are granted to the Employee, the stock subject
to such rights shall be considered
- 9 -
stock that is
optioned to the Employee, and if alternative stock appreciation
rights (a/k/a tandem stock appreciation rights) are granted to the
Employee, the stock appreciation rights shall be considered terms
of the options to which they are alternative/tandem; or
(viii) the Company
or a Permitted Assignee attempts to assign any of its rights or
obligations under this Agreement other than in accordance with
paragraph 13(d) below and does not remedy the situation within
thirty (30) days after the Company receives written notice
from the Employee of the situation; or
(ix) the Company,
BPI or any Subsidiary or Affiliate materially breaches the terms of
this Agreement.
In no event shall
the Employee’s continued employment after any of the
foregoing constitute the Employee’s consent to the act or
omission in question, or a waiver of the Employee’s right to
terminate employment for Good Reason hereunder on account of such
act or omission, except as provided in the following sentence. With
respect to any act, omission, or occurrence that is alleged to
occur after the Commencement Date and prior to a Change in Control
or Potential Change in Control, the Employee must provide the
Company with written notice of any one (1) or more of the
conditions set forth in this definition of Good Reason within six
(6) months of the initial existence of the condition for such
condition to constitute Good Reason. Such notice shall not excuse
the Employee from continuing to perform the duties and
responsibilities assigned to the Employee until such time as the
Employee terminates employment. Notwithstanding the foregoing, this
notice requirement shall not apply to acts or omissions alleged to
constitute Good Reason that arise after a Change in Control or
Potential Change in Control.
(i)
Notwithstanding any provision of this Agreement to the contrary,
(A) if during the term of this Agreement as the same may be
extended from time to time pursuant to Section 2 above, a
medical condition prevents the Employee, even with a reasonable
accommodation by the Company, from substantially performing the
Employee’s duties hereunder (it being understood that a
transitory illness, such as a cold or flu, that prevents the
Employee from substantially performing the Employee’s duties
hereunder during a brief period is not such a medical condition),
then until the date, if any, on which the Employee recovers from
such medical condition (the “ Evaluation Period
”), the Company may terminate the Employee’s employment
only pursuant to subparagraph 5(e)(ii) below (a “
Disability Termination ”) or for willful misconduct
constituting Good Cause under paragraph 5(c) above, and (B) if
any notice of nonextension of the term of this Agreement was given
before the Evaluation Period, or is given during the Evaluation
Period, whether by the Company, BPI or an Affiliate or the
Employee, pursuant to Section 2 above, and, but for this
clause (B), the term of this Agreement would expire during the
Evaluation Period as a result of such notice of nonextension having
been given, then the term of this Agreement will automatically be
extended without action by any party until the Employee recovers
from such medical condition. For purposes of this paragraph 5(e),
the Employee will be deemed to recover from a medical condition
only if and when the Employee both (I) has been able to
substantially perform the Employee’s duties hereunder (either
with or without a
- 10 -
reasonable
accommodation by the Comp
|