The Company and each of Mr. Willoughby and Mr. Madden have also entered into
Executive Severance Agreements. Under these agreements, and in consideration for, among other things, the agreement by the executive to be bound by a restrictive covenant, in the event of the termination of the employment of the executive other than
for cause (including termination following a reduction in the executives base salary unless such reduction is part of, and proportionate with, a general reduction in officer compensation), the executive is entitled to a severance payment,
based on the executives years of service, up to a maximum of twice the executives salary and the bonus, if any, that the executive would have received for such fiscal year (based upon the executives targeted bonus amount and the
Companys actual results for such fiscal year), payable in monthly installments over a period not to exceed two years (based on the executives years of service). In addition, in the event of termination without cause, the executive is
entitled during the severance period to a continuation of benefits and to the accelerated vesting of all options then held by the executive, and the executive is considered a continuing employee of the Company for all purposes for which the
executives status as an employee of the Company would entitle the executive to some benefit, including the vesting of Performance Shares and Restricted Stock Units. The severance payment and benefits are reduced by any compensation or benefits
received by the executive from any subsequent employer.
Effective as of December 31, 2008, the Company and Mr. Willoughby and
Mr. Madden entered into an amendment to the existing Executive Severance Agreements and Change in Control Severance Agreements between the Company and such persons. The primary purpose of such amendment was to modify such agreements so that
they conform to Section 409A of the Internal Revenue Code. In addition, the amendment to the Executive Severance Agreement modified the calculation of the severance amount thereunder so that it is based on the highest annual rate of base salary
during the
12-month
period immediately prior to the qualifying termination.
For purposes of
providing quantitative disclosure of the foregoing, assuming that a qualifying triggering event occurred as of December 31, 2018: (i) Mr. Willoughby would have been entitled to receive aggregate cash payments of approximately $1,030,000
(payable over 24 months), other benefits with an estimated value of approximately $95,000, and up to 366,993 shares of the Companys stock valued at $1,882,674 based on the $5.13 closing price of the Companys stock on December 31,
2018, (and, in the event of a change in control, an additional amount of up to 57,036 shares of the Companys stock valued at $292,595 based on the $5.13 closing price of the Companys stock on December 31, 2018, plus, if applicable,
an additional payment to cover any excise tax liability) and (ii) Mr. Madden would have been entitled to receive aggregate cash payments of approximately $710,000 (payable over 24 months), other benefits with an estimated value of
approximately $95,000, and up to 173,625 shares of the Companys stock valued at $890,696 based on the $5.13 closing price of the Companys stock on December 31, 2018 (and, in the event of a change in control, an additional amount of
up to 33,272 shares of the Companys stock valued at $170,685 based on the $5.13 closing price of the Companys stock on December 31, 2018, plus, if applicable, an additional payment to cover any excise tax liability).
The Company and Mr. Hess entered into an agreement under which, and in consideration for, among other things, the agreement of such
individual to be bound by a restrictive covenant, in the event of the termination of his employment other than for cause (including termination following a reduction in his or her base salary unless such reduction is part of, and proportionate with,
a general reduction in officer compensation), he is entitled to a severance benefit of continuation of base salary, Restricted Stock Units and Performance Shares vesting and employee benefits for the twelve month period following termination. In
addition, upon a change in control, certain unvested Performance Shares and all unvested Restricted Stock Units held by such individual immediately vest.
For purposes of providing quantitative disclosure of the foregoing, assuming that a qualifying triggering event occurred as of
December 31, 2018: (i) Mr. Hess would have been entitled to receive aggregate cash payments of approximately $325,000 (payable over twelve months) and other benefits with an estimated value of approximately $35,000, and up to 31,048 shares
of the Companys stock valued at $159,276 based on
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