Rosetta Stone 2010 Annual Report Download - page 127

compensation or other payments from the Company or any of its Subsidiaries or Executive's ownership interest in the Company,
including, but not limited to, wages, bonuses, dividends, the receipt or exercise of stock options and/or the receipt or vesting of
restricted stock.
(m) Waiver of Jury Trial. BOTH PARTIES TO THIS AGREEMENT AGREE THAT ANY ACTION, DEMAND, CLAIM OR
COUNTERCLAIM RELATING TO THE TERMS AND PROVISIONS OF THIS AGREEMENT, OR TO ITS BREACH, MAY BE
COMMENCED IN THE COMMONWEALTH OF VIRGINIA IN A COURT OF COMPETENT JURISDICTION. BOTH PARTIES TO THIS
AGREEMENT FURTHER AGREE THAT ANY ACTION, DEMAND, CLAIM OR COUNTERCLAIM SHALL BE RESOLVED BY A JUDGE
ALONE, AND BOTH PARTIES HEREBY WAIVE AND FOREVER RENOUNCE THAT RIGHT TO A TRIAL BEFORE A CIVIL JURY.
13. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding and except as set forth below, in the event it shall be
determined that any payment or distribution by, or benefit from, the Company or an Affiliate or any person who acquires ownership or
effective control or ownership of a substantial portion of the Company's assets (within the meaning of section 280G of the Code) or by
any Affiliate of such person, to or for the benefit of Executive (whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 13) (a
"Payment") would be subject to the excise tax imposed by section 4999 of the Code or any interest or penalties are incurred by
Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then Executive shall be entitled to receive an additional payment (a "Gross-Up Payment") in an amount
such that after payment by Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including
without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Any
Gross-Up Payment that the Company is required to make to reimburse Executive for federal, state and local taxes imposed upon
Executive, including the amount of additional taxes imposed upon Executive due to the Company's payment of the initial taxes on
such amounts, shall be made by the Company by the end of Executive's taxable year next following Executive's taxable year in which
Executive remits the related taxes to the taxing authority.
(b) Subject to the provisions of Section 13(c), all determinations required to be made under this Section 13, including
whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, shall be made by a nationally recognized accounting firm that is (i) not serving as accountant or auditor
for the person who acquires ownership or effective control or ownership of a substantial portion of the Company's assets (within the
meaning of section 280G of the Code) or any Affiliate of such person and (ii) agreed upon by the Company and Executive (the
"Accounting Firm"). The Accounting Firm shall provide detailed supporting calculations both to the Company and Executive within
15 business days after appointment by the Company and Executive and receipt of notice from Executive that there has been a
Payment, or such earlier time as is requested by the Company. All fees and expenses of the Accounting Firm shall be
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