Rosetta Stone 2014 Annual Report Download - page 182

(b) Bonus Plan. Executive shall be eligible to receive a bonus in accordance with Company bonus policy to be
established by the Board from time to time. The bonus, if any, will be determined by the Board based upon the Company’s
achievement of financial performance goals and other objectives, as determined by the Board in good faith for each fiscal year of the
Company. The Company will pay Executive the bonus, if any, in accordance with the terms of the then-current Company bonus
policy. As of July 1, 2014, Executive will be able to participate in the annual bonus plan (the “Annual Bonus”) and be eligible to
receive an Annual Bonus target of seventy-five percent (75%) of his Annual Base Salary upon one hundred percent (100%)
achievement of annual objectives, prorated for the length of participation in 2014. For subsequent years, the Annual Bonus target as a
percentage of then-current Annual Base Salary, may be adjusted, but may not be less than seventy-five percent (75%) of the
Executive’s then-current Annual Base Salary.
(c) Equity. Executive shall be eligible to receive annual grants of stock options and other equity awards in accordance
with equity compensation arrangements established by the Board. The grants shall have such terms as are determined by the Board in
accordance with the current stock plan in place at time of grant.
(d) Benefits.
(i) Executive and, to the extent eligible, his dependents, shall be entitled to participate in and receive all benefits
under any welfare or pension benefit plans and programs made available to the Company’s senior level executives or to
its employees generally (including, without limitation, medical, disability and life insurance programs, accidental death
and dismemberment protection, leave and participation in retirement plans and deferred compensation plans), subject,
however, to the generally applicable eligibility, participation, and other provisions of the various plans and programs
and laws and regulations in effect from time to time.
(ii) The Company shall reimburse Executive for all reasonable, ordinary and necessary business, travel or
entertainment expenses incurred during the Service Term in the performance of his services hereunder in accordance
with the policies of the Company as they are from time to time in effect. Executive, as a condition precedent to
obtaining such payment or reimbursement, shall provide to the Company any and all statements, bills or receipts
evidencing the travel or out-of-pocket expenses for which Executive seeks payment or reimbursement, and any other
information or materials, which the Company may from time to time reasonably require. The Company shall reimburse
Executive the amount of such an expense in accordance with the Company’s expense reimbursement policy as in effect
from time to time, subject to Section 15.
(iii) Executive shall be allotted twenty-two (22) paid vacation days per annum which shall be provided pro rata
during the applicable year and seven (7) paid sick days and shall be entitled to medical, disability, family and other
leave in accordance with Company policies as in effect from time to time for senior executives. Paid vacation and sick
days not used by 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