AMENDED AND RESTATED
EMPLOYMENT SEPARATION AGREEMENT
This Amended and Restated Employment Separation
Agreement (this “Agreement”), dated as of December 31,
2008, is entered into by and between PDI, Inc., a Delaware
corporation (the “Company”), having its principal place
of business at 1 Route 17 South, Saddle River, New Jersey 07458,
and Mr. Jeffrey E. Smith, residing
at (the
“Executive”).
WHEREAS, the Company and Executive previously
entered into an Employment Separation Agreement, effective as of
May 15, 2006 (the “Prior Agreement”); and
WHEREAS, the Company and Executive desire to
amend and restate the Prior Agreement to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986,
as amended and the regulations promulgated thereunder (the
“Code”), and to make certain other clarifying changes,
with this Agreement to supersede the Prior Agreement in its
entirety.
NOW, THEREFORE, in consideration of the premises
and mutual agreements herein contained, the parties hereby agree as
follows:
1.
Employment .
In
connection with the Executive’s acceptance of that certain
offer of employment letter dated May 5, 2006 and contingent upon
the Executive’s appointment by the Company’s Board of
Directors (the “Board”), the Company shall employ the
Executive as Executive Vice President, Chief Financial Officer and
Treasurer commencing on or about May 15, 2006 which employment
shall terminate upon notice by either party, for any
reason. Executive understands and agrees that his
employment with the Company is at will and can be terminated at any
time by either party, and for any or no reason.
2.
Termination Benefits .
a. In
further consideration for Executive’s agreement to execute
the PDI Confidentiality, Non-Solicitation and Covenant Not to
Compete Agreement (the “Confidentiality Agreement”),
the Company agrees that if it terminates the Executive’s
employment without Cause (as defined below) or if the Executive
terminates his employment as provided for in Section 2b. hereof,
and, in each instance, as of the 30 th day following his termination, the Executive has
executed the PDI Agreement and General Release given to him upon
such termination (the “Release”), any applicable
revocation period has expired and Executive has not revoked the
Release during such revocation period, then:
|
|
If the
Executive terminates his employment before May 15, 2007 ,
the Executive shall be paid a lump sum payment equal to (y) the
product of twelve (12) times his Base Monthly Salary, plus (z) the
average annual cash incentive compensation paid to the Executive
during the three years immediately preceding the termination
date, or such shorter period if applicable. For purposes of the
average calculation, any amount paid for 2006 will be annualized.
The sum of (y) and (z) is referred to herein as the
“Severance Payment”.
|
|
|
If such
termination occurs after May 15, 2007 the Executive shall be
paid a lump sum payment equal to (y) the product of eighteen (18)
times his Base Monthly Salary, plus (z) the average cash incentive
compensation paid to the Executive during the most recent three
years immediately preceding the termination date
for
|
|
|
which such
incentive compensation was paid, or such shorter period, For
purposes of the average calculation, any amount paid for 2006 will
be annualized. The sum of (y) and (z) is referred to herein as the
“Severance Payment”. Subject to Section 2(d)
below, such payment shall be made within forty-five (45) days after
Executive’s termination date.
|
b. In
the event that the Company is obligated to pay the Executive the
Severance Payment, in addition to such payment the Company shall
reimburse Executive for the cost of the premiums for the
continuation of the Executive’s health and welfare benefits
under the Company’s group health plan under COBRA for up to
twelve (12) months (the “COBRA Benefit”), provided that
no reimbursement shall be paid unless and until Executive submits
proof of payment acceptable to the Company within 90 days after
Executive incurs such expense. Any reimbursements of the
COBRA premium that are taxable to the Executive shall be made on or
before the last day of the year following the year in which the
COBRA premium was incurred, the
|
