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Exhibit 10.5 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 Michael J. Bogda (the " Employee "). WITNESSETH:
WHEREAS, the Company and the Employee
entered into an employment agreement dated as of May 15, 2003,
which was amended and restated as of 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. 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 President and Chief Operating Officer, reporting
to the Chief Executive Officer of the Company (the " CEO ")
or such other officer as the Chief Executive Officer of BPI (the "
BPI CEO ") may direct.
As the Company’s President and Chief Operating Officer,
the Employee shall be responsible for managing and supervising, and
shall have responsibility for the day-to-day operation of, the
Company’s manufacturing and engineering functions and
facilities, including manufacturing and engineering activities
conducted by the Company on behalf of BPI or any Affiliate (as
defined below), and shall have responsibility for Quality and
Pharma Chemicals, as well as significant responsibilities with
respect to the Company’s budgeting, financial forecasting and
capital management activities, subject to the authority of the
Board of Directors of BPI (the " Board ") and the CEO. The
Employee shall have all of the powers, authority, duties and
responsibilities usually incident to the position and role of
President and Chief Operating Officer of companies that are
comparable in size, character, and performance to the Company and
shall perform such other reasonable duties, consistent with the
position of President and Chief Operating Officer as may lawfully
be assigned to the Employee by the Board, the CEO, or the BPI CEO.
(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
BPI CEO, 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 six hundred thousand dollars ($600,000), 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 sixty-five percent (65%) 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
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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
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
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Employee with the provisions of Sections 6 and 7 below,
relating to confidential information, non-solicitation and
disparaging remarks, the Company shall, as liquidated 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 Vice Presidents 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
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full year of employment); provided that, if the Compensable
Termination occurs 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 two and one-half (2
1 /2) 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
nonextension), 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 (30)
months following a Compensable Termination, the Company shall also
provide the Employee (and, as applicable, the Employee’s
covered dependents), at Company expense, with
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continuation coverage under the Company’s group health
plan(s) covering similarly situated executives. For 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 (30) months following the Employee’s
termination, the Company shall also provide the Employee (and, as
applicable, the Employee’s covered dependents), at
Company
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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 two and one-half (2
1 /2) 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 (30) 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:
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(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, BPI or an Affiliate,
(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:
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(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 or responsibilities 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 President and Chief Operating 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,
another officer to whom the Employee reports in accordance with
paragraph 3(a) above, 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
President and Chief Operating 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
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rights are granted to the Employee, the stock subject to such
rights shall be considered 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.
(e)
Disability (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 conditi
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