3. Treatment Upon Separation from Service.
(a) If Grantee has a separation from service (within the meaning of Treasury Regulation § 1.409A-1(h), hereinafter a Separation from Service) by reason of death or Disability (as defined in the applicable Company long-term disability policy as in effect at the time of Grantees disability) prior to the Vesting Date, the Award shall become fully vested as of the date of such Separation from Service.
(b) If Grantee has a Separation from Service other than as specified in Section 3(a) above or Section 4 below prior to the Vesting Date, the Award shall be immediately forfeited as of the date of such Separation from Service.
4. Treatment upon Change in Control. If Grantees employment is terminated by the Company without Cause (as defined in Section 4(a)), or Grantee resigns his or her employment for Good Reason (as defined in Section 4(b)), in either case, on or after a Change in Control, a prorated portion of the Award that would have vested on the Vesting Date shall vest at the target level of achievement. Such prorated portion shall equal the amount that would otherwise have vested on the Vesting Date multiplied by a fraction, the numerator of which is the number of days elapsed since the Grant Date through the date of termination or resignation, as applicable, and the denominator of which is 365. All portions of the Award that do not vest in accordance with this Section 4 shall terminate and be forfeited without consideration, effective on the Vesting Date.
(a) Cause means that the Company may terminate the Grantees employment if, in the reasonable determination of the Company, (i) the Grantee engages in conduct that materially violates the policies of the Company, (ii) the Grantee fails to perform the essential functions of his or her job (except for a failure resulting from a bona fide illness or incapacity) or fails to carry out the Companys reasonable directions issued by the Grantees supervisor, with respect to the Grantees material duties, (iii) the Grantee engages in embezzlement or misappropriation of corporate funds or other acts of fraud, dishonesty or self-dealing, or commits a felony or any significant violation or any material statutory or common law duty of loyalty to the Company, or (iv) the Grantee breaches a material provision of the Companys Separation Pay Plan. Notwithstanding the foregoing, to the extent a Grantee is party to an employment agreement, Participation Agreement, or other agreement with the Company that contains a definition of Cause or a term of similar effect, the definition set forth in such employment agreement, Participation Agreement or other agreement, and not the definition set forth in the Separation Pay Plan, shall control.
(b) Good Reason means that a Grantee will be considered to have Good Reason to resign his or her employment if (i) such Grantee is a party to an employment agreement, Participation Agreement or other pre-existing agreement with the Company that contains provisions for such Grantee to be entitled to severance payments or benefits based on a termination for Good Reason or a term of similar effect, and (ii) such Grantee fulfills the requirements set forth in the that employment agreement, Participation Agreement, or other agreement to, in fact, terminate for Good Reason (or a term of similar effect).
5. Withholding Taxes. Any amounts payable or otherwise provided under this letter are subject to withholding for applicable federal, state and local taxes or otherwise as required by law.