Rosetta Stone 2014 Annual Report Download - page 157

calendar year end shall be forfeited unless otherwise provided in the Company’s vacation and sick leave policy.
(iv) Notwithstanding anything to the contrary contained above, the Company shall be entitled to terminate or
reduce any employee benefit enjoyed by Executive pursuant to the provisions of this Section 3(g), but only if such
reduction is part of an across-the-board reduction applicable to all executives of the Company who are entitled to such
benefit and is permissible under the Code and the Employee Retirement Income Security Act of 1974, as amended.
(e) Sign On Bonus. Executive shall receive a one-time cash signing bonus in the amount of $75,000, subject to taxes
and applicable withholdings, payable on the first payroll following hire date. If Executive voluntarily terminates employment with
Rosetta Stone, without Good Reason, or if the Executive is terminated by the Company for Cause, as defined below, within twelve
(12) months of receiving the cash signing bonus, the Executive agrees to reimburse the Company 100% of the cash signing bonus
within 30 days of the effective date of termination.
4. Employment Term.
Unless Executive’s employment under this Agreement is sooner terminated as a result of Executive’s resignation or termination
in accordance with the provisions of Section 5 below, Executive’s term of employment (“Service Term”) under this Agreement shall
commence on the date hereof and shall continue for a period of one (1) year, and at the end of each day it shall renew and extend
automatically for an additional day so that the remaining Service Term is always one year; provided, however, that either party may
terminate this Agreement pursuant to Section 5 below for any reason.
5. Termination.
Executive’s employment with the Company shall cease upon the first of the following events to occur:
(a) Immediately upon Executive’s death.
(b) Upon thirty (30) days’ prior written notice by Executive to the Company of Executive’s voluntary retirement at age
65 or older.
(c) Upon thirty (30) days’ prior written notice by the Company to Executive of the Executive’s termination due to
Disability. “Disability” means (i) Executive is unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of
not less than twelve (12) months, or (ii) Executive is, by reason of any medically determinable physical or mental impairment that can
be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income
replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the
Company. A determination of Disability may be made by a physician selected or approved by the Chief Executive Officer and, in this
respect, Executive shall submit to an examination by such physician upon request by the Chief Executive Officer. Any such
termination for disability shall be only as expressly permitted by the Americans with Disabilities Act and any other applicable laws.