Under the Holt Severance Agreement, Good Reason is defined as the occurrence of
any one of the following: (i) the material diminution of her title, duties, authority or responsibilities, relative to the her duties, authority or responsibilities as in effect immediately prior to such reduction or the assignment to executive
of such reduced duties, authority or responsibilities (other than temporarily while physically or mentally incapacitated and unable to properly perform such duties, as determined by the Board in good faith); (ii) a material reduction of her target
compensation opportunity; (iii) an involuntary relocation of the principal place of employment by more than 50 miles or (iv) a material breach by the Company of a material agreement with her.
The Holt Severance Agreement provides that if, during the period beginning one year prior to a change of control (as defined below) and ending
one year following the change in control, Ms. Holt is terminated without Cause (as defined above) or if Ms. Holt voluntarily terminates her employment for Good Reason (as defined above), then (i) Ms. Holt will receive a lump sum
severance payment equal to three times annual base salary (as in effect on the day prior to the date of such termination); (ii) Ms. Holt will receive an annual cash bonus for the year of termination, payable at target level, but prorated for
the fiscal year based on her termination date; (iii) Ms. Holt is entitled to receive a receive a lump sum cash payment equal to the amount that the Company would have paid for her medical and dental coverage for the 24-month period following termination of employment at the same level of health and dental coverage she had in effect immediately prior to termination, and (iv) for all awards held by Ms. Holt under any of
our equity plans shall immediately vest and, if applicable, remain exercisable for a period of 24-months.
The Holt Severance Agreement defines a change of control as (i) a person acquiring 50% or more of the voting power of the
Company, (ii) a change in the composition of our Board during any 24-month period as a result of which less than a majority of the directors are incumbent directors (as defined in the
Agreement), (iii) a merger or consolidation of the Company (unless it still controls a majority of the voting stock), (iv) a complete liquidation or dissolution of the Company, or (v) a sale, disposition, lease, or exchange of all or
substantially all of the Companys assets.
By entering into the Holt Severance Agreement, Ms. Holt agreed to be subject to and
bound by the confidentiality, non-compete, non-disclosure and non-solicitation provisions therein.
The Holt Severance Agreement also provide that if payments that are triggered by a change of control would be subject to an excise tax under
Section 4999 of the Internal Revenue Code, as amended, then the payments either (i) would be reduced by the amount needed to avoid triggering the excise tax or (ii) would not be reduced, depending on which alternative left
Ms. Holt in the best after-tax position.
Executive Severance Agreement for
Former Executive Chairman of the Board
The Company entered into an Executive Severance Agreement with Mr. Miller on
September 7, 2015 (the Miller Severance Agreement) that provides for severance benefits that are similar in nature to the provisions in Ms. Holts agreement. In connection with Mr. Millers transition from
Chief Executive Officer and President to Executive Chairman, the Company and Mr. Miller further entered into a Letter Agreement (the Letter Agreement), effective August 9, 2021, which modifies certain provisions of the
Miller Severance Agreement.
Pursuant to the Letter Agreement, Mr. Miller continues to receive the remainder of his base salary
through August 9, 2022. In addition, Mr. Miller will be eligible for an annual cash bonus with respect to the 2023 fiscal year with a target payout of 150% of base salary and maximum annual bonus of 200% of his target bonus, which will be
prorated for purposes of the 2023 fiscal year.
Mr. Miller shall continue to become vested in his 2022 fiscal year and 2023 fiscal
year awards. As provided in the Miller Severance Agreement, all outstanding and unvested awards held by Mr. Miller will continue to vest and be exercisable for 24 months after termination of his services. Pursuant to the Letter Agreement,
Mr. Miller waived all rights to severance benefits, except for the continued vesting and exercisability of his outstanding awards, under the Miller Severance Agreement, although the other terms, including restrictive covenants, of the Miller
Severance Agreement remain in effect.
Severance for the Other Named Executive Officers
Messrs. Bchara, Lastinger and Prior are participants in the Severance Plan. Messrs. Bchara, Lastinger and Prior are eligible to receive salary
continuation payments for a specified number of months (the Severance Period), if the participant is terminated for any reason other than (i) resignation from employment, other than for good reason, (ii) cause (as defined in
the Severance Plan), (iii) death or (iv) disability (as defined in the Severance Plan). The Severance Period for Messrs. Bchara and Lastinger is 18-months, and the
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