EMPLOYMENT SEPARATION
AGREEMENT
This Employment Separation Agreement (this
“Agreement”) is effective as of November
12, 2008, 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 Nancy Lurker,
residing
at (the
“Executive”), pursuant to which the aforementioned
parties agree:
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In connection
with Executive’s acceptance of that certain offer of
employment letter dated October 24, 2008 (the “Offer
Letter”) and contingent upon Executive’s successful
completion of any pre-employment screening requirements set forth
in the Offer Letter and execution of the Company’s
Confidentiality, Non-Solicitation and Covenant Not to Compete
Agreement, the Company shall employ the Executive as Chief
Executive Officer of the Company, which employment shall terminate
upon notice by either party, for any reason.
Executive understands and agrees that Executive’s
employment with the Company is at will and can be terminated at any
time by either party, and for any or no reason.
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Compensation and Benefits Payable Upon
Involuntary Termination without Cause or Resignation for Good
Reason or Change of Control .
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Triggering Event . In further consideration for
Executive’s employment, Executive will receive the
compensation and benefits set forth in Section 2(b) if the
requirements set forth in Subsections (i or ii) and Subsection iii
(hereinafter referred to as the “Triggering Event”) are
met:
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i.
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Executive’s employment is terminated
involuntarily by the Company at any time for reasons other than
death, Total Disability or Cause, or Executive resigns from
employment for Good Reason; or
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ii.
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Executive’s employment is terminated in
connection with a Change of Control (as defined in Section 6(c);
and
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iii.
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As of the 30th
day following her termination date, Executive has executed the
Agreement and General Release in substantially the form attached to
this Agreement or in such form as may be provided by the Company
(the “Release”), provided that Release does not release
Executive’s rights and benefits as vested under ERISA or wage
and hour laws of New Jersey, any applicable revocation period has
expired and Executive has not revoked the Release during such
revocation period.
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Compensation and Benefits
. Following the
occurrence of a Triggering Event, the Company will provide the
following compensation and benefits to Executive:
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i.
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The Company
will pay Executive a lump sum payment equal to the product of: (a)
eighteen (18) times Executive’s Base Monthly Salary
(excluding incentives, bonuses, and other compensation), plus the
actual amount paid to Executive under any cash-based incentive or
bonus plan in which Executive participates with respect to the last
full fiscal year of Executive’s participation in such plan
prior to the date of termination of Executive’s employment
with the Company if the Triggering Event occurs on or before
November 18, 2010; or (b) twenty-four (24) times
Executive’s Base Monthly Salary (excluding incentives,
bonuses, and other compensation) , plus the average of the annual
amounts paid to Executive under any cash-based incentive or bonus
plan in which Executive participates with respect to the last three
(3) full
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fiscal years of
Executive’s participation in such plan prior to the date of
termination of Executive’s employment with the Company (or,
if Executive’s number of full fiscal years of participation
in any such plan prior to the date of termination of
Executive’s employment is less than three (3), the average of
the annual amounts paid to Executive over the number of full fiscal
years of Executive’s participation in such plan prior the
date of termination of Executive’s employment) if the
Triggering Event occurs after November 18, 2010.
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The Company
will reimburse Executive for the cost of the premiums for COBRA
group health continuation coverage under the Company’s group
health plan paid by Executive for coverage during the period
beginning following Executive’s termination date and ending
on the earlier of either: (A) eighteen (18) months if
the Triggering Event occurs on or before November 18, 2010
or twenty-four (24) months if the Triggering Event occurs
after November 18, 2010; or (B) the date on which Executive becomes
eligible for other group health coverage, 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 amount of the COBRA premium
eligible for reimbursement during one year shall not affect the
amount of COBRA premium eligible for reimbursement in any other
year, and the right to reimbursement shall not be subject to
liquidation or exchange for another benefit.
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Delay of
Payment to Comply with Code Section 409A
. Notwithstanding
anything herein to the contrary, if at the time of
Executive’s termination of employment with the Company,
Executive is a “specified employee” within the meaning
of Code Section 409A and the regulations promulgated thereunder,
then the Company shall delay the commencement of such payments
(without any reduction) by a period of six (6) months after
Executive’s termination of employment. Any
payments that would have been paid during such six (6) month period
but for the provisions of the preceding sentence shall be paid in a
lump sum to Executive six (6) months and one (1) day after
Executive’s termination of employment. The 6-month
payment delay requirement of this Section 2(c) shall apply only to
the extent that the payments under this Section 2 are otherwise
subject to Code Section 409A. With respect to payments
or benefits under this Agreement that are subject to Code Section
409A, whether Executive has had a termination of employment shall
be determined in accordance with Code Section 409A and applicable
guidance issued thereunder.
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3.
Other Compensation and Benefits .
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Except as may
be provided under this Agreement, any benefits to which Executive
may be entitled pursuant to the plans, policies and arrangements of
the Company shall be determined and paid in accordance with the
terms of such plans, policies and arrangements, and Executive shall
have no right to receive any other compensation or benefits, or to
participate in any other plan or arrangement, following the
termination of Executive’s employment by either party for any
reason.
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Notwithstanding
any provision contained herein to the contrary, in the event of any
termination of employment, the Company shall pay Executive her
earned, but unpaid, base salary within ten (10) days of
Executive’s termination date and shall reimburse Executive
for any accrued, but unpaid, reasonable business expenses, in each
case, earned or accrued as of
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