Classmates.com 2010 Annual Report Download - page 318

“ separation from service ” means Employee’s cessation of employee status with the Company by reason of Employee’s death,
resignation, dismissal or other termination event and shall be deemed to occur at such time as the level of bona fide services Employee
is to render as such an employee (or as a non-employee consultant) permanently decreases to a level that is not more than twenty
percent (20%) of the average level of services Employee rendered as an employee during the immediately preceding thirty-six (36)
months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such
determination of Employee’s separation from service shall, however, be made in accordance with the applicable standards of the
Treasury Regulations issued under Section 409A of the Code.
(e) Code Section 409A Deferral Period. Notwithstanding any provision in this Agreement to the contrary (other than Section 7
(f) below), no payment or distribution under this Agreement which constitutes an item of deferred compensation under Section 409A of the Code
and becomes payable by reason of Employee’
s termination of employment with the Company will be made to Employee until Employee incurs a
separation from service (as such term is defined above and determined in accordance with Treasury Regulations issued under Section 409A of
the Code) in connection with such termination of employment. For purposes of this Agreement, each amount to be paid or benefit to be
provided Employee shall be treated as a separate identified payment or benefit for purposes of Section 409A of the Code. In addition, no
payment or benefit which constitutes an item of deferred compensation under Section 409A of the Code and becomes payable by reason of
Employee’s separation from service will be made to Employee prior to the earlier of (i) the first day of the seventh (7th) month measured from
the date of such separation from service or (ii) the date of Employee’s death, if Employee is deemed at the time of such separation from service
to be a “specified employee” (as determined pursuant to Code Section 409A and the Treasury Regulations thereunder) and such delayed
commencement is otherwise required in order to avoid a prohibited distribution under Code Section 409A(a)(2). Upon the expiration of the
applicable deferral period, all payments and benefits deferred pursuant to this Section 7(e) (whether they would have otherwise been payable in a
single sum or in installments in the absence of such deferral) shall be paid or provided to Employee in a lump sum on the first day of the seventh
(7th) month after the date of Employee’s separation from service or, if earlier, the first day of the month immediately following the date the
Company receives proof of Employee’s death. Any remaining payments or benefits due under this Agreement will be paid in accordance with
the normal payment dates specified herein.
(f) Provisions Applicable to “Specified Employee”. Notwithstanding Section 7(e) above, the following provisions shall also
be applicable to Employee if Employee is a “specified employee” at the time of Employee’s separation of service:
(i) Any payments or benefits which become due and payable to Employee during the period beginning with the date of
Employee’s separation from service and ending on March 15 of the following calendar year and otherwise qualify for the short-term
deferral exception to Code Section 409A shall not be subject to the holdback provisions of Section 7(e) and shall accordingly be paid as
and when they become due and payable under this Agreement in accordance with such short-term deferral exception to Code
Section 409A.
(ii) The remaining portion of the payments and benefits to which Employee becomes entitled under this Agreement, to
the extent they do not in the aggregate exceed the dollar limit described below and are otherwise scheduled to be paid no later than the
last day of the second calendar year following the calendar year in which Employee’s separation from service occurs, shall not be
subject to the holdback provisions of Section 7(e) and shall be paid to Employee as they become due and payable under this
Agreement. For purposes of this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of
(i) Employee’s annualized compensation (based on Employee’s annual rate of pay for the calendar year preceding the
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