Exhibit 10.1
EMPLOYMENT
AGREEMENT
This Employment Agreement (the “
Agreement ”), entered into and effective as of October
14, 2008 (the “ Effective Date ”), is by and
between Orthofix Inc., a Minnesota corporation (the “
Company ”), and Bradley R. Mason, an individual (the
“ Executive ”).
PRELIMINARY
STATEMENTS
A.
Breg, Inc., a California corporation and affiliate of the
Company, and the Executive are parties to an Employment Agreement,
entered into as of November 20, 2003 (as amended on November 20,
2007, the “ Prior Agreement ”), which Prior
Agreement expires December 31, 2008.
B.
The Company and the Executive are also parties to
a Second Amended and Restated Performance Accelerated Stock Options
Agreement, dated as of the date hereof (as amended or modified from
time to time, the “ PASO Agreement
”).
C.
The Company and the Executive desire
to enter into this Agreement to memorialize the terms of their
relationship and in order for the Company to retain the long-term
services of the Executive and the Executive desires to render such
services, upon the terms and conditions contained
herein.
D.
The Company and the Executive agree and acknowledge that
pursuant to this Agreement the Executive will receive consideration
and other benefits over and above that which he would otherwise be
entitled to receive as compensation for services performed for the
Company.
E.
The Company is a subsidiary of Orthofix International N.V., a
corporation organized under the laws of the Netherlands Antilles
(the “ Parent ”), for whom Executive will also
perform services as contemplated hereby, and under certain
compensation plans of which Executive shall be eligible to receive
compensation, and Parent is agreeing to provide such compensation
and guarantee the Company’s payment obligations
hereunder.
F.
Capitalized terms used herein and not otherwise defined have the
meaning for them set forth on Exhibit A attached hereto and
incorporated herein by reference.
The parties, intending to be legally bound,
hereby agree as follows:
I. EMPLOYMENT
AND DUTIES
1.1
Duties . The Company hereby employs
the Executive as an employee, and the Executive agrees to be
employed by the Company, upon the terms and conditions set forth
herein. While serving as an employee of the Company, the
Executive shall serve as Group President, North America of the
Parent. The Executive shall report to such senior
executive(s) as the Company shall determine from time to time and
shall have such power and authority and perform such duties,
functions and responsibilities as are associated with and incident
to such positions, and as the Board may from time to time require
of him; provided , however , that such authority,
duties, functions and responsibilities are commensurate with the
power, authority, duties, functions and responsibilities generally
performed by chief operating officers of companies which are
similar in size and nature to, and the financial position of, the
Parent Group. The Executive also agrees to serve, if
elected, as an officer or director of Parent or any other direct or
indirect subsidiary of the Parent, in each such case at no
compensation in addition to that provided for in this Agreement,
but the Executive serves in such positions solely as an
accommodation to the Company and such positions shall grant him no
rights hereunder (including for purposes of the definition of Good
Reason).
1.2
Services . During the Term (as
defined in Section 1.3), and excluding any periods of vacation,
sick leave or disability, the Executive agrees to devote his full
business time, attention and efforts to the business and affairs of
the Company. During the Term, it shall not be a
violation of this Section 1.2 for the Executive to (a) serve on
civic or charitable boards or committees (but not corporate
boards), (b) deliver lectures or fulfill speaking engagements or
(c) manage personal investments, so long as such activities do not
interfere with the performance of the Executive’s
responsibilities in accordance with this Agreement. The
Executive must request the Board’s prior written consent to
serve on a corporate board, which consent shall be at the
Board’s reasonable discretion and only so long as such
service does not interfere with the performance of his
responsibilities hereunder.
1.3
Term of Employment . The term
of this Agreement shall commence on the Effective Date and shall
continue until 11:59 p.m. Eastern Time on April 1, 2010 (the
“ Initial Term ”) unless sooner terminated or
extended as provided hereunder. This Agreement shall
automatically renew for an additional one-year period on April 1,
2010 (such extension, the “ Renewal Term ”),
unless either party gives the other party written notice of its or
his election not to extend such employment at least 180 days prior
to April 1, 2010. Further, if a Change of Control occurs
when less than two full years remain in the Initial Term or during
any Renewal Term, this Agreement shall automatically be extended
for two years only from the Change of Control Date and thereafter
shall terminate on the second anniversary of the Change of Control
Date in accordance with its terms. The Initial Term,
together with any Renewal Term or extension as a result of a Change
of Control, are collectively referred to herein as the “
Term .” In the event that the Executive
continues to be employed by the Company (or any other member of the
Parent Group) after the Term, unless otherwise agreed by the
parties in writing, such continued employment shall be on an
at-will, month-to-month basis upon terms agreed upon at such time
without regard to the terms and conditions of this Agreement and
this Agreement shall be deemed terminated at the end of the Term,
regardless of whether such employment continues at-will, other than
Articles VI and VII, which shall survive the termination or
expiration of this Agreement for any reason.
II. COMPENSATION
2.1
General . The base salary and
Incentive Compensation (as defined in Section 2.3.) payable to the
Executive hereunder, as well as any stock-based compensation,
including stock options, stock appreciation rights and restricted
stock grants, shall be determined from time to time by the Board
and paid pursuant to the Company’s customary payroll
practices or in accordance with the terms of the applicable
stock-based Plans (as defined in Section 2.4). The
Company shall pay the Executive in cash, in accordance with the
normal payroll practices of the Company, the base salary and
Incentive Compensation set forth below. For the
avoidance of doubt, in providing any compensation payable in stock,
the Company may withhold, deduct or collect from the compensation
otherwise payable or issuable to the Executive a portion of such
compensation to the extent required to comply with applicable tax
laws to the extent such withholding is not made or otherwise
provided for pursuant to the agreement governing such stock-based
compensation.
2.2
Base Salary . The Executive
shall be paid a base salary of no less than $29,166.66 per month
($350,000 on an annualized basis) while he is employed by the
Company during the Term; provided , however , that
nothing shall prohibit the Company from reducing the base salary as
part of an overall cost reduction program that affects all senior
executives of the Parent Group and does not disproportionately
affect the Executive, so long as such reductions do not reduce the
base salary to a rate that is less than 90% of the minimum base
salary amount set forth above (or, if the minimum base salary
amount has been increased during the Term, 90% of such increased
amount). The base salary shall be reviewed annually by
the Board for increase (but not decrease, except as permitted
above) as part of its annual compensation review, and any increased
amount shall become the base salary under this
Agreement.
2.3
Bonus or other Incentive Compensation
. With respect to each fiscal year of the Company during
the Term, the Executive shall be eligible to receive annual bonus
compensation in an amount based on reasonable goals for the earning
of such compensation as may be determined by the Board from time to
time (the “ Goals ”). Amounts that
may be earned upon attainment of all reasonably achievable annual
Goals will be targeted to equal not less than 60% of the annual
base salary in such fiscal year. The amount of any
actual payment under the Bonus Plan will depend upon the
achievement (or not) of the various performance metrics comprising
the Goals, with an opportunity to earn maximum annual bonus
compensation of not less than 90% of annual base salary in such
fiscal year under Parent’s Executive Annual Incentive Plan or
any successor plan or as may be determined by the Board from
time-to-time (the “ Bonus Plan
”). Amounts will be less than either such target
if the Goals are not met as set forth under the terms of the
plan. Amounts payable under the Bonus Plan shall be
determined by the Board and shall be payable following such fiscal
year and no later than two and one-half months after the end of
such fiscal year. In addition, the Executive shall be
eligible to receive such additional bonus or incentive compensation
as the Board may establish from time to time in its sole
discretion. Any bonus or incentive compensation under
this Section 2.3 under the Bonus Plan or otherwise is referred to
herein as “ Incentive Compensation
.” Stock-based compensation shall not be
considered Incentive Compensation under the terms of this Agreement
unless the parties expressly agree otherwise in writing.
2.4
Stock Compensation . The
Executive shall be eligible to receive stock-based compensation,
whether stock options, stock appreciation rights, restricted stock
grants or otherwise, under the Parent’s 2004 Long Term
Incentive Plan or other stock-based compensation plans as Parent
may establish from time to time (collectively, the “
Plans ”). The Executive shall be considered
for such grants no less often than annually as part of the
Board’s annual compensation review, but any such grants shall
be at the sole discretion of the Board.
III. EMPLOYEE
BENEFITS
3.1
General . Subject only to any
post-employment rights under Article V, so long as the Executive is
employed by the Company pursuant to this Agreement, he shall be
eligible for the following benefits to the extent generally
available to senior executives of the Company or by virtue of his
position, tenure, salary and other qualifications. Any
eligibility shall be subject to and in accordance with the terms
and conditions of the Company’s benefits policies and
applicable plans (including as to deductibles, premium sharing,
co-payments or other cost-splitting arrangements).
3.2
Savings and Retirement Plans
. The Executive shall be entitled to participate in, and
enjoy the benefits of, all savings, pension, salary continuation
and retirement plans, practices, policies and programs available to
senior executives of the Company.
3.3
Welfare and Other Benefits . The Executive
and/or the Executive’s eligible dependents, as the case may
be, shall be entitled to participate in, and enjoy the benefits of,
all welfare benefit plans, practices, policies and programs
provided by the Company (including without limitation, medical,
prescription, drug, dental, disability, salary continuance, group
life, dependent life, accidental death and travel accident
insurance plans and programs) and other benefits (including,
without limitation, executive physicals and tax and financial
planning assistance) at a level that is available to other senior
executives of the Company.
3.4
Vacation . The Executive shall
be entitled to four weeks paid vacation per 12-month
period.
3.5
Expenses . The Executive
shall be entitled to receive prompt reimbursement for all
reasonable business-related expenses incurred by the Executive in
performing his duties under this
Agreement. Reimbursement of the Executive for such
expenses will be made upon presentation to the Company of expense
vouchers that are in sufficient detail to identify the nature of
the expense, the amount of the expense, the date the expense was
incurred and to whom payment was made to incur the expense, all in
accordance with the expense reimbursement practices, policies and
procedures of the Company.
3.6
Key Man Insurance . The
Company shall be entitled to obtain a “key man” or
similar life or disability insurance policy on the Executive, and
neither the Executive nor any of his family members, heirs or
beneficiaries shall be entitled to the proceeds
thereof. Such insurance shall be available to offset any
payments due to the Executive pursuant to Section 5.1 of this
Agreement due to his death or Disability.
IV. TERMINATION
OF EMPLOYMENT
4.1
Termination by Mutual Agreement
. The Executive’s employment may be terminated at
any time during the Term by mutual written agreement of the Company
and the Executive.
4.2
Death . The
Executive’s employment hereunder shall terminate upon his
death.
4.3
Disability . In
the event the Executive incurs a Disability for a continuous period
exceeding 90 days or for a total of 180 days during any period of
12 consecutive months, the Company may, at its election, terminate
the Executive’s employment during the Term by delivering a
Notice of Termination (as defined in Section 4.8) to the Executive
30 days in advance of the date of termination.
4.4
Good Reason . The Executive may terminate his
employment at any time during the Term for Good Reason by
delivering a Notice of Termination to the Company 30 days in
advance of the date of termination; provided ,
however , that the Executive agrees not to terminate his
employment for Good Reason until the Executive has given the
Company at least 30 days’ in which to cure the circumstances
set forth in the Notice of Termination constituting Good Reason and
if such circumstances are not cured by the 30
th day, the Executive’s employment shall
terminate on such date. If the circumstances
constituting Good Reason are remedied within the cure period to the
reasonable satisfaction of the Executive, such event shall no
longer constitute Good Reason for purposes of this Agreement and
the Executive shall thereafter have no further right hereunder to
terminate his employment for Good Reason as a result of such
event.
Unless the
Executive provides written notification of an event described in
the definition of Good Reason within 90 days after the Executive
has actual knowledge of the occurrence of any such event, the
Executive shall be deemed to have consented thereto and such event
shall no longer constitute Good Reason for purposes of this
Agreement.
4.5
Termination without Cause . The
Company may terminate the Executive’s employment at any time
during the Term without Cause by delivering to the Executive a
Notice of Termination 30 days in advance of the date of
termination; provided that as part of such notice the Company may
request that the Executive immediately tender the resignations
contemplated by Section 4.9 and otherwise cease performing his
duties hereunder. The Notice of Termination need not
state any reason for termination and such termination can be for
any reason or no reason. The date of termination shall
be the date set forth in the Notice of Termination.
4.6
Cause . The Company may terminate the
Executive’s employment at any time during the Term for Cause
by delivering a Notice of Termination to the Executive. The Notice
of Termination shall include a copy of a resolution duly adopted by
the affirmative vote of not less than a majority of the entire
membership of the Board, at a meeting of the Board
called and held for such purpose, finding that in the good faith
opinion of the Board an event constituting Cause has occurred and
specifying the particulars thereof. A Notice of
Termination for Cause may not be delivered unless in conjunction
with such Board meeting the Executive was given reasonable notice
and the opportunity for the Executive, together with the
Executive’s counsel, to be heard before the Board prior to
such vote. If the event constituting Cause for
termination is other than as a result of a breach or violation by
the Executive of any provision of Article VI and only if the event
constituting Cause is curable, then the Executive shall have 30
days from the date of the Notice of Termination to cure such event
described therein to the reasonable satisfaction of the Board in
its sole discretion and, if such event is cured by the Executive
within the cure period, such event shall no longer constitute Cause
for purposes of this Agreement and the Company shall thereafter
have no further right to terminate the Executive’s employment
for Cause as a result of such event. The Executive shall
have no other rights under this Agreement to cure an event that
constitutes Cause. Unless the Company provides written
notification of an event described in the definition of Cause
within 90 days after the Company knows or has reason to know of the
occurrence of any such event, the Company may not terminate the
Executive for Cause unless such event is recurring or
uncurable. Knowledge shall mean actual knowledge of the
Board or the Company’s senior executives.
4.7
Voluntary Termination
. The Executive may voluntarily terminate his employment
at any time during the Term by delivering to the Company a Notice
of Termination 30 days in advance of the date of termination (a
“ Voluntary Termination ”). For purposes of this
Agreement, a Voluntary Termination shall not include a termination
of the Executive’s employment by reason of death or for Good
Reason, but shall include voluntary termination upon retirement in
accordance with the Company’s retirement policies. A
Voluntary Termination shall not be considered a breach or other
violation of this Agreement.
4.8
Notice of Termination
. Any termination of employment under this Agreement by
the Company or the Executive requiring a notice of termination
shall require delivery of a written notice by one party to the
other party (a “ Notice of Termination ”). A
Notice of Termination must indicate the specific termination
provision of this Agreement relied upon and the date of
termination. It must also set forth in reasonable detail the facts
and circumstances claimed to provide a basis for such termination,
other than in the event of a Voluntary Termination or termination
without Cause. The date of termination specified in the
Notice of Termination shall comply with the time periods required
under this Article IV, and may in no event be earlier than the date
such Notice of Termination is delivered to or received by the party
getting the notice. If the Executive fails to include a
date of termination in any Notice of Termination he delivers, the
Company may establish such date in its sole
discretion. No Notice of Termination under Section 4.4
or 4.6 shall be effective until the applicable cure period, if any,
shall have expired without the Company or the Executive,
respectively, having corrected the event or events subject to cure
to the reasonable satisfaction of the other party. The
terms “termination” and “termination of
employment,” as used herein are intended to mean a
termination of employment which constitutes a “separation
from service” under Section 409A.
4.9
Resignations
. Upon ceasing to be an employee of the Company for any
reason, or earlier upon request by the Company pursuant to Section
4.5, the Executive agrees to immediately tender written
resignations to the Company with respect to all officer and
director positions he may hold at that time with any member of the
Parent Group.
V. PAYMENTS
ON TERMINATION
5.1
Death; Disability; Resignation for Good
Reason; Termination without Cause . If at any time
during the Term the Executive’s employment with the Company
is terminated pursuant to Section 4.2, 4.3, 4.4 or 4.5, the
Executive shall be entitled to the following only:
(a) any
unpaid base salary and accrued unpaid vacation then owing through
the date of termination or Incentive Compensation that is as of
such date actually earned or owing under Article II, but not yet
paid to the Executive, which amounts shall be paid to the Executive
within 30 days of the date of termination; provided, however, the
Executive shall be entitled to receive the pro rata amount of any
Bonus Plan Incentive Compensation for the fiscal year of his
termination of employment (based on the number of business days he
was actually employed by the Company during the fiscal year in
which the termination of employment occurs) that he would have
received had his employment not been terminated during such year.
Nothing in the foregoing sentence is intended to give the Executive
greater rights to such Incentive Compensation than a pro rata
portion of what he would ordinarily be entitled to under the Bonus
Plan Incentive Compensation that would have been applicable to him
had his employment not been terminated, it being understood that
Executive’s termination of employment shall not be used to
disqualify Executive from or make him ineligible for a pro rata
portion of the Bonus Plan Incentive Compensation to which he would
otherwise have been entitled. The pro rata portion of
Bonus Plan Incentive Compensation shall, subject to Section
7.16, be paid at the time such Incentive Compensation is
paid to senior executives of the Company (“ Severance
Bonus Payment Date ”).
(b) a
one-time lump sum severance payment in an amount equal to 100% of
the Executive’s Base Amount. The lump sum
severance payment shall be paid within 30 days after the date of
termination, subject, in the case of termination other than as a
result of the Executive’s death, to Section 7.16.
(c) all
stock options, stock appreciation rights or similar stock-based
rights previously granted to the Executive shall vest in full and
be immediately exercisable and any risk of forfeiture included in
restricted or other stock grants previously made to the Executive
shall immediately lapse. In addition, if the
Executive’s employment is terminated pursuant to Section 4.4
or 4.5, the Executive shall have until the latest date that each
stock option or stock appreciation right would otherwise expire by
its original terms had the Executive’s employment not
terminated (but in no event later than 10 years from the original
grant date of the stock option or stock appreciation right) to
exercise any outstanding stock options or stock appreciation
rights. The vesting and extension of the exercise period
set forth in this Section 5.1(c) shall occur notwithstanding any
provision in any Plans or related grant documents which provides
for a lesser vesting or shorter period for exercise upon
termination by the Company without Cause (which for this purpose
shall include a termination by the Executive for Good Reason),
notwithstanding anything to the contrary in any Plans or grant
documents; provided, however , and for the avoidance of
doubt, nothing in this Agreement shall be construed as or imply
that this Agreement does or can grant greater rights than are
allowed under the terms and conditions of the
Plans. Neither this Section 5.1(c) nor any other
provision of this Agreement (including as it relates to a Change of
Control or any other termination event or rights accruing on
termination) shall apply to the stock options represented by the
PASO Agreement and the termination of the Executive under this
Agreement shall create no rights greater or different than those
expressly set forth in the PASO Agreement.
(d) to
the fullest extent permitted by the Company’s then-current
benefit plans, continuation of coverage (including family coverage)
under basic employee group benefits that are welfare benefits (such
as group health and group life benefits), but not pension,
retirement, profit-sharing, severance or similar compensatory
benefits, for the Executive and the Executive’s eligible
dependents substantially similar to coverage they were receiving or
which they were entitled to immediately prior to the termination of
the Executive’s employment for the lesser of 12 months after
termination or until the Executive secures coverage from new
employment and the period of COBRA health care continuation
coverage provided under Section 4980B of the Code shall run
concurrently with the foregoing 12-month period. In
order to receive such benefits, the Executive or his eligible
dependents must continue to make any required co-payments,
deductibles, premium sharing or other cost-splitting arrangements
the Executive was otherwise paying immediately prior to the date of
termination and nothing herein shall require the Company to be
responsible for such items. If Executive is a
“specified employee” under Section 409A, the full cost
of the continuation or provision of employee group welfare benefits
(other than medical or dental benefits) shall be paid by Executive
until the earliest to occur of (i) Executive’s death or (ii)
the first day of the seventh month following Executive’s
termination of employment, and such cost shall be reimbursed by the
Company to, or on behalf of, Executive in a lump sum cash payment
on the earlier to occur of Executive’s death or the first day
of the seventh month following Executive’s termination of
employment, except that, as provided above, Executive shall not
receive reimbursement for any required co-payments, deductibles,
premium sharing or other cost-splitting arrangements the Executive
was otherwise paying immediately prior to the date of
termination.
(e) payment
or reimbursement to the Executive of the costs and expenses of any
executive outplacement firm selected by the Executive in an amount
not to exceed $25,000 during the 24-month period following his date
of termination. The Executive shall provide the Company
with reasonable documentation of such costs and
expenses.
In the event
the Executive’s termination is pursuant to Section 4.2, in
lieu of a lump sum payment, the Executive’s heirs,
beneficiaries, or personal representatives, as applicable, shall
receive (i) salary-related portions of the Base Amount on regular
payroll dates of the Company until the first anniversary of the
date of termination of the Executive and (ii) Incentive
Compensation-related portions of the Base Amount on the dates that
such Incentive Compensation is actually paid by the Company to its
senior executives. Further, any payments by the Company
under Section 5.1(b) above pursuant to a termination under Section
4.2 or 4.3 shall be reduced by any payments received by the
Executive pursuant to any of the Company’s employee welfare
benefit plans providing for payments in the event of death or
Disability.
5.2
Termination for Cause; Voluntary Termination . If
at any time during the Term the Executive’s employment with
the Company is terminated pursuant to Section 4.6 or 4.7, the
Executive shall be entitled to only the following:
(a) any
unpaid base salary and accrued unpaid vacation then owing through
the date of termination or Incentive Compensation that is as of
such date actually earned or owing under Article II, but not yet
paid to the Executive, which amounts shall be paid to the Executive
within 30 days of the date of termination. Nothing in
this provision is intended to imply that the Executive is entitled
to any partial or pro rata payment of Incentive Compensation on
termination unless the Bonus Plan expressly provides as much under
its specific terms.
(b) with
respect to any stock-based compensation such as stock options,
stock appreciation rights or restricted stock grants:
(i) in
the event of a (A) Voluntary Termination on or prior to March 31,
2010 or (B) termination for Cause, whatever rights, if any, that
are available to the Executive upon such a termination pursuant to
the Plans or any award documents related to any stock-based
compensation such as stock options, stock appreciation rights or
restricted stock grants. For the avoidance of doubt, in
the event of a Voluntary Termination on or prior to March 31, 2010
or any termination for Cause, this Agreement does not grant any
greater rights (regarding vesting, exercise or otherwise) with
respect to stock options, stock appreciation rights or
restricted stock grants than is provided for in the Plans or the
award documents.
(ii) in
the event of a Voluntary Termination after March 31, 2010 only, all
stock options, stock appreciation rights or similar stock-based
rights previously granted to the Executive shall vest in full and
be immediately exercisable and any risk of forfeiture included in
restricted or other stock grants previously made to the Executive
shall immediately lapse. In addition, if the
Executive’s employment is terminated in accordance with
Section 4.7 after March 31, 2010, the Executive shall have until
the latest date that each stock option or stock appreciation right
would otherwise expire by its original terms had the
Executive’s employment not terminated (but in no event later
than 10 years from the original grant date of the stock option or
stock appreciation right) to exercise any outstanding stock options
or stock appreciation rights. The vesting and extension
of the exercise period set forth in this Section 5.2(b)(ii) shall
occur notwithstanding any provision in any Plans or related grant
documents which provides for a lesser vesting or shorter period for
exercise upon a Voluntary Termination, notwithstanding anything to
the contrary in any Plans or grant documents; provided,
however , and for the avoidance of doubt, nothing in this
Agreement shall be construed as or imply that this Agreement does
or can grant greater rights than are allowed under the terms and
conditions of the Plans.
5.3
Termination following Change of Control . The
Executive shall have no specific right to terminate this Agreement
or right to any severance payments or other benefits solely as a
result of a Change of Control or Potential Change of
Control. However, if during a Change of Control Period
during the Term, (a) the Executive terminates his employment with
the Company pursuant to Section 4.4, or (b) the Company terminates
the Executive’s employment pursuant to Section 4.5, the lump
sum severance payment under Section 5.1 shall be increased from
100% of the Base Amount to 150% times the Base Amount and the
period for continuation of benefits under Section 5.1 shall be
increased to 18 months from 12 months. The terms and
rights with respect to such payments shall otherwise be governed by
Section 5.1. No other rights result from termination
during a Change of Control Period; provided , however
, that nothing in this Section 5.3 is intended to limit or impair
the rights of the Executive under the Plans or any documents
evidencing any stock-based compensation awards in the event of a
Change of Control if such Plans or award documents grant greater
rights than are set forth herein.
5.4
Release . The Company’s obligation to pay
or provide any benefits to the Executive following termination
(other than in the event of death pursuant to Section 4.2) is
expressly subject to the requirement that he execute and not breach
or rescind a release relating to employment matters and the
circumstances surrounding his termination in favor of the members
of the Parent Group and their officers, directors and related
parties and agents, in a form acceptable to the Company at the time
of termination of employment.
5.5
Other Benefits . Except as expressly provided
otherwise in this Article V, the provisions of this Agreement shall
not affect the Executive’s participation in, or terminating
distributions and vested rights under, any pension, profit-sharing,
insurance or other employee benefit plan of the Parent Group to
which the Executive is entitled pursuant to the terms of such
plans, or expense reimbursements he is otherwise entitled to under
Section 3.5.
5.6
No Mitigation . It will be difficult, and may be
impossible, for the Executive to find reasonably comparable
employment following the termination of the Executive’s
employment, and the protective provisions under Article VI
contained herein will further limit the employment opportunities
for the Executive. In addition, the Company’s
severance pay policy applicable in general to its salaried
employees does not provide for mitigation, offset or reduction of
any severance payment received thereunder. Accordingly,
the parties hereto expressly agree that the payment of severance
compensation in accordance with the terms of this Agreement will be
liquidated damages, and that the Executive shall not be required to
seek other employment, or otherwise, to mitigate any payment
provided for hereunder.
5.7
Limitation; No Other Rights . Any amounts due or
payable under this Article V are in the nature of severance
payments or liquidated damages, or both, and the Executive agrees
that such amounts shall fully compensate the Executive, his
dependents, heirs and beneficiaries and the estate of the Executive
for any and all direct damages and consequential damages that they
do or may suffer as a result of the termination of the
Executive’s employment, or both, and are not in the nature of
a penalty. Notwithstanding the above, no member of the
Parent Group shall be liable to the Executive under any
circumstances for any consequential, incidental, punitive or
similar damages. The Executive expressly acknowledges
that the payments and other rights under this Article V shall be
the sole monies or other rights to which the Executive shall be
entitled to and such payments and rights will be in lieu of any
other rights or remedies he might have or otherwise be entitled
to. In the event of any termination under this Article
V, the Executive hereby expressly waives any rights to any other
amounts, benefits or other rights, including without limitation
whether arising under current or future compensation or severance
or similar plans, agreements or arrangements of any
