Exhibit 10.1
AMENDED AND
RESTATED
EMPLOYMENT
AGREEMENT
This Amended and Restated Employment Agreement
(the “ Agreement ”), entered into and effective
as of July 1, 2009 (the “ Effective Date ”), is
by and between Orthofix Inc., a Minnesota corporation (the “
Company ”), and Michael Simpson, an individual (the
“ Executive ”).
PRELIMINARY
STATEMENTS
A. The
Company and the Executive are parties to an Amended and Restated
Employment Agreement, entered into and effective as of December 6,
2007 (the “ Prior Agreement ”), but desire to
further amend and restate the Prior Agreement in its entirety to
memorialize the terms of their relationship in order to retain the
continued services of the Executive.
B.
The Executive desires to render
such services, upon the terms and conditions contained
herein.
C.
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 was entitled to receive under
the Prior Agreement and over and above that which he would
otherwise be entitled to receive as compensation for services
performed for the Company.
D.
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.
E.
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 and the Prior Agreement is hereby amended and restated
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 the President – Orthopedics North
America of the Company, and be appointed to serve as the President
– Orthopedics North America, of the Parent. The
Executive 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 similarly-situated executives
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).
Exhibit 10.1
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 July 1, 2011 (the “
Initial Term ”) unless sooner terminated or extended
as provided hereunder. This Agreement shall
automatically renew for additional one-year periods on July 1, 2011
and on each and every July 1 thereafter (each 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 six months prior to the next July 1
renewal date. 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 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 (except as expressly provided herein)
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, plus specified provisions
of Articles IV and V to the extent they relate to termination of
employment after expiration of the Term, 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.
Exhibit 10.1
2.2
Base Salary . The Executive shall be paid a base
salary of no less than $24,166.67 per month ($290,000 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
annual Goals will be targeted to equal not less than 50% 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 60% 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
or nothing if the Goals are not met as set forth under the terms of
the Bonus 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 Amended and Restated 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.
Exhibit 10.1
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 4
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.
Exhibit 10.1
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 or after 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 or after 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 or after 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 or after 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.
Exhibit 10.1
4.7
Voluntary Termination . The Executive may
voluntarily terminate his employment at any time during or after
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 payment and benefits set forth below
only. If at any time after 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 payment and benefits set forth in (a), (b) and the
specified provisions of (c) only.
Exhibit 10.1
(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 ”) but in no event later than two and
one-half months after the end of such fiscal year.
(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 of the
Executive’s signing the release described in Section 5.4 and
the expiration of any applicable revocation period, 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 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 4.2,
4.3, 4.4 or 4.5 during or after the Term, the Executive shall have
until the earlier of (i) five (5) years from the date of
termination, or (ii) 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 to exercise any outstanding stock options or
stock appreciation rights that were granted prior to June 30,
2009. For any new stock options awarded after June 29,
2009, if the Executive’s employment is terminated pursuant to
Section 4.2, 4.3, 4.4 or 4.5 during or after the Term, the
Executive shall have until the earlier of (i) two (2) years from
the date of termination, or (ii) 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
to exercise any vested and outstanding stock options or stock
appreciation rights that were granted after June 29,
2009. 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; provided,
further , and for the avoidance of doubt, the first sentence of
this Section 5.1(c) shall not apply to a termination of employment
after the Term.
Exhibit 10.1
(d) to
the fullest extent permitted by the Company’s then-current
benefit plans, continuation of health, dental, vision and life
insurance coverage (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 $12,500 during the 12-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 twelve-month 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, but in no event later than two and one-half
months after the end of such fiscal year. 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.
Exhibit 10.1
5.2
Termination for Cause; Voluntary Termination . If
at any time during or after 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) 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. This Agreement does
not grant any greater rights with respect to such items than
provided for in the Plans or the award documents in the event of
any termination for Cause or a Voluntary Termination.
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 or after 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% of the Base
Amount and, for a termination of employment described in (a) and
(b) during the Term, 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. The Company shall deliver
such release to the Executive within three business days following
his termination of employment and the Executive shall be obligated
to sign and return the release to the Company within 45 days of
receipt of such release to receive any benefits or payments
following termination.
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 member of the
Parent Group (including as a result of changes in (or of) control
or similar transactions), unless Executiv
