Change in Control Agreement
If (a) your Service (as defined in the 2009 Plan) to the Company is terminated by the Company other than for death, disability or Cause (as defined in the 2009 Plan) within the three-month period prior to or the twelve-month period following a Change in Control (as defined in Section 2(g) of the 2009 Plan), or (b) the Acquiror (as defined in the 2009 Plan) in such Change in Control does not either (i) assume the Companys rights and obligations with respect to an Award or (ii) substitute such for such Award a substantially equivalent (A) award to purchase the Acquirors (or its subsidiarys) stock or (B) cash award, then 100% of any unvested shares underlying your Existing Awards and any Future Awards shall immediately vest and, as applicable, become exercisable upon the later to occur of such termination and such Change in Control.
If any payment or benefit pursuant to this Agreement or otherwise that you would receive in connection with a Change in Control (a Transaction Payment) would (i) constitute a parachute payment within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the Code), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the Excise Tax), then the Company shall cause the following: (1) payment in full of the entire amount of the Transaction Payments (a Full Payment), or (2) payment of only a part of the Transaction Payments so that you receive the largest payment possible without the imposition of the Excise Tax (a Reduced Payment), whichever amount results in your receipt, on an after-tax basis, of the greater amount of the Transaction Payment notwithstanding that all or some portion of the Transaction Payment may be subject to the Excise Tax. For purposes of determining whether to make a Full Payment or a Reduced Payment, the Company shall cause to be taken into account all applicable federal, state and local income and employment taxes and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes). If a Reduced Payment is made, (x) the Transaction Payment shall be paid only to the extent permitted under the Reduced Payment alternative, and you shall have no rights to any additional payments and/or benefits constituting the Transaction Payment, and (y) reduction in payments and/or benefits shall occur in the following order: (1) reduction of cash payments (if any); (2) cancellation of accelerated vesting of equity awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction of other benefits (if any) paid to you; provided that in each case, the reduction of payments and benefits shall be implemented in a manner that does not violate Section 409A of the Code. In the event that acceleration from your equity awards is to be reduced, such acceleration of vesting shall be canceled in the reverse order of the date of grant. The Company shall appoint a nationally recognized independent registered public accounting firm or law firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations required to be made hereunder. The firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and you within fifteen (15) calendar days after the date on which your right to a Transaction Payment is triggered (if requested at that time by the Company or you) or such other time as reasonably requested by the Company or you. If firm determines that no Excise Tax is payable with respect to the Transaction Payments, either before or after the application of the Reduced Amount, it shall furnish the Company with an opinion reasonably acceptable to the Company that no Excise Tax will be imposed with respect to such Transaction Payments. Any good faith determinations of the firm made hereunder shall be final, binding and conclusive upon you.
Nothing in this Agreement changes the nature of your employment. Your employment with the Company continues to be at will; it is for no specified term, and may be terminated by you or the Company at any time, with or without cause or advance notice.
In consideration for the foregoing protections, by counter-signing the Agreement to which this is attached you reaffirm and agree that: (1) for a period ending one year after the Date of Termination for any reason (the Noncompetition Period), you will not directly or indirectly other than on behalf of the Company, without the prior written consent of the Company, engage (whether as an employee, agent, consultant, advisor, independent contractor, proprietor, partner, officer, director or otherwise), or have any ownership interest in (except for passive ownership of five percent (5%) or less of any entity whose securities have been registered under the Securities Act of 1933 or Section 12 of the Securities Exchange Act of 1934), or participate in the financing, operation, management or control of, that portion of any firm, partnership, corporation, entity or business that engages or participates in a competing business purpose; and (2) during the Noncompetition Period, you will not without the written consent of the Company, directly or indirectly through another entity, induce or attempt to induce any employee of the Company and its subsidiaries to leave the employ of the Company or a Company subsidiary, or in any way interfere with the relationship between the Company or a Company subsidiary and any employee thereof and will not induce or attempt to induce any customer, supplier, client, broker, licensee or other business relation of the Company or its subsidiaries to cease doing business, or to alter in any manner its business relationship, with the Company or its subsidiaries. By signing the Agreement, both parties signify their intent for the non-compete to be enforceable to the maximum extent allowable by law. This Agreement shall be governed in all aspects by the laws of the State of Washington.