The
purpose of the Plan is to enable the Employer to offer certain protections
to
employees if their employment with the Employer is terminated without Cause
or
for Good Reason in connection with a Change in Control. Accordingly, to
accomplish this purpose, the Board has adopted the Plan, effective as of March3, 2008.
Unless
otherwise expressly provided in Section 2.3
or
unless otherwise agreed to between the Company and a Participant on or after
the
date hereof, Participants covered by the Plan shall not be eligible to
participate in any other severance or termination plan, policy or practice
of
the Employer that would otherwise apply under the circumstances described
herein. The Plan is intended to fall within the definition of an “employee
welfare benefit plan” under Section 3(1) of ERISA. Important administrative
provisions of (and information about) the Plan and important information about
a
Participant’s rights under the Plan and applicable law are contained in Article
VIII. This Plan document shall constitute both the Plan document and summary
plan description and shall be distributed to Participants in this form.
Capitalized terms and phrases used herein shall have the meanings ascribed
thereto in Article I.
ARTICLE
I
DEFINITIONS
For
purposes of the Plan, capitalized terms and phrases used herein shall have
the
meanings ascribed in this Article.
1.1“Affiliate”
shall
mean (i) any subsidiary corporation of the Company within the meaning of Section
424(f) of the Code, (ii) any corporation, trade or business (including, without
limitation, a partnership or limited liability company) which is directly or
indirectly controlled 50% or more (whether by ownership of stock, assets or
an
equivalent ownership interest or voting interest) by the Company, or (iii)
any
other entity which is designated as an Affiliate by the Board.
1.2“Base
Salary”
shall
mean a Participant’s annual base compensation rate for services paid by the
Employer to the Participant at the time immediately prior to the Participant’s
termination of employment, as reflected in the Employer’s payroll records or, if
higher, the Participant’s annual base compensation rate immediately prior to a
Change in Control. Base Salary shall not include commissions, bonuses, overtime
pay, incentive compensation, benefits paid under any qualified plan, any group
medical, dental or other welfare benefit plan, non-cash compensation or any
other additional compensation but shall include amounts reduced pursuant to
a
Participant’s salary reduction agreement under Section 125, 132(f)(4) or 401(k)
of the Code, if any, or a nonqualified elective deferred compensation
arrangement, if any, to the extent that in each such case the reduction is
to
base salary.
1.3“Board”
shall
mean the Board of Directors of the Company.
1.4“Bonus”shall
mean the Participant’s annual bonus for the fiscal year in which a Change in
Control shall occur, as in effect immediately prior to the Change in Control,
as
set forth under the Participant’s individual employment agreement with the
Employer or in any written bonus plan, program or arrangement approved by the
Board or the Compensation
Committee of the
Board.
With respect to any Bonus that is based on a range and/or subject to the
achievement of a performance goal(s), the Bonus shall be deemed to be the
Participant’s target level bonus without regard to the actual level of
performance (whether individual performance or company performance) achieved.
Notwithstanding the foregoing, Bonus shall not include any bonus to be paid
upon
the completion of any specified milestone or project or upon the occurrence
of a
specified event.
1.5“Cause”
shall
mean the occurrence of any of the following:
(a) the
continued failure by the Participant to substantially perform his or her duties
after receipt of notice from the Employer requesting such
performance;
(b) the
criminal conviction by plea or after trial of having engaged in criminal
misconduct (including embezzlement and fraud) which is demonstrably injurious
to
the Employer, monetarily or otherwise;
(c) the
conviction of the Participant for a felony;
(d) gross
negligence on the part of the Participant affecting the Employer; or
(e) failure
of the Participant to adhere to the Employer’s written policies or to cooperate
in any investigation or inquiry involving the Employer.
1.6“Change
in Control”
shall
have the meaning set forth in Appendix
A
hereto.
1.7 “COBRA”
shall
mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended.
1.8“Code”
shall
mean the Internal Revenue Code of 1986, as amended.
1.9“Code
Section 409A”
shall
mean Section 409A of the Code together with the treasury regulations and other
official guidance promulgated thereunder.
1.10“Committee”shall
mean the Compensation Committee of the Board or such other committee appointed
by the Board from time to time to administer the Plan.
1.11“Company”
shall
mean Take-Two Interactive Software, Inc., a Delaware corporation, and any
successor as provided in Article VI hereof.
2
1.12 “Completed
Year of Service”
shall
mean each full twelve (12) consecutive month period of service with the Employer
commencing on the Participant’s most recent date of hire by the Employer and any
anniversary thereof. Any prior periods of service shall be disregarded in
calculating Completed Years of Service.
1.13“Continuation
Period”
shall
mean a period commencing on the date of a Participant’s termination of
employment until the earliest of:
(A)
(i)
in the case of a Tier 1 Employee, a period eighteen (18) months from the date
of
termination; (ii) in the case of a Tier 2 Employee, twelve (12) months from
the
date of termination; and (iii) in the case of a Tier 3 Employee, six (6) months
from the date of termination;
(B)
the
date
the Participant becomes eligible for coverage under the health insurance plan
of
a subsequent employer; and
(C)
the
date
the Participant or the Participant’s eligible dependents, as the case may be,
cease to be eligible under COBRA.
1.14 “Continued
Health Coverage”
shall
mean the benefit set forth in Section 2.2(b)
below.
1.15“Delay
Period”
shall
mean the period commencing on the date the Participant incurs a Separation
from
Service from the Employer until the earlier of (A) the six (6)-month anniversary
of the date of such Separation from Service and (B) the date of the
Participant’s death.
1.16“Disability”
shall
mean a Participant’s disability that would qualify as such under the Employer’s
long-term disability plan without regard to any waiting periods set forth in
such plan.
1.18“Employer”
shall
mean the Company and any Affiliate.
1.19“Equity
Vesting”
shall
mean the benefit set forth in Section 2.2(c)
below.
1.20“ERISA”
shall
mean the Employee Retirement Income Security Act of 1974, as
amended.
1.21“Exchange
Act”shall
mean the Securities Exchange Act of 1934, as amended.
1.22“Foreign
Participant”
shall
mean any Participant who
on
the
date of the Change in Control is
employed
or residing in any country other than the United States. The Company’s
management, with the approval of the chairman of the Compensation Committee
of
the
Board,
may at
any time prior to a Change in Control
adopt
special guidelines and provisions for Foreign Participants to comply with the
applicable laws of such other countries.
3
1.23“Good
Reason”
shall
mean the occurrence of any of the following events on or following a Change
in
Control without the Participant’s express written consent, provided the
Participant gives notice to the Employer of the Good Reason event within ninety
(90) days after the Participant has knowledge of the Good Reason event and
such
events are not fully corrected in all material respects by the Employer within
thirty (30) days following receipt of the Participant’s written
notification:
(a) a
material diminution in
the
Participant’s Base
Salary;
(b) a
material diminution in the Participant’s authority, duties or
responsibilities;
(c) a
material diminution in the authority, duties, or responsibilities of the
supervisor to whom the Participant is required to report, including a
requirement that the Participant report to a corporate officer or an employee
instead of reporting directly to the Board;
(d) a
material diminution in the budget over which the Participant retains
authority;
(e) a
relocation of the Participant’s principal business location to an area outside a
50 mile radius of the Participant’s principal business location immediately
prior to the Change in Control;
(f) any
other
action or inaction that constitutes a material breach by the Employer of the
Plan or of an employment agreement between the Employer and the Participant;
or
(g) if
the
Participant has an Individual Severance Agreement that defines “good reason” (or
words of like import), then the occurrence of any event that constitutes good
reason under the Participant’s Individual Severance Agreement.
1.24“Individual
Severance Agreement”
shall
mean an approved, executed, written agreement between the Employer and the
Participant that has not expired or been replaced prior to the termination
of
the Participant’s employment and that provides for specific severance for the
Participant in connection with a termination of employment.
1.25“Participant”
shall
mean any Tier 1 Employee, Tier 2 Employee, Tier 3 Employee or Tier 4 Employee
who is employed on the date of the Change in Control. The tier for each
Participant shall be determined by the Employer in its sole and absolute
discretion. Notwithstanding the foregoing or anything in the Plan to the
contrary, any individual who is providing services to the Company pursuant
to
the Management Agreement between the Company and ZelnickMedia Corporation dated
March 30, 2007, as amended from time to time, shall not be eligible to be a
Participant in the Plan.
1.26“Plan”
shall
mean the Take-Two Interactive Software, Inc. Change in Control Employee
Severance Plan.
4
1.27“Separation
from Service”
shall
mean termination of a Participant’s employment with the Employer, provided that
such termination constitutes a separation from service within the meaning of
Code Section 409A. All references in the Plan to a “resignation,”“termination,”“termination of employment” or like terms shall mean Separation from
Service.
1.28 “Separation
Pay Limit”
shall
mean two (2) times the lesser of (i) a Participant’s annualized compensation
based on such Participant’s annual rate of pay for the taxable year of such
Participant preceding the taxable year in which such Participant incurs a
Separation from Service, and (ii) the maximum amount that may be taken into
account under a tax qualified plan pursuant to Code Section 401(a)(17) for
the
year in which such Participant incurs a Separation from Service.
1.29“Severance
Benefits”
shall
mean collectively, the Severance Payments, the Continued Health Coverage and
the
Equity Vesting.
1.30“Severance
Payments”
shall
mean the payments set forth in Section 2.2(a) below.
1.31“Severance
Period”shall
mean (i) in the case of a Tier 1 Employee, a period eighteen (18) months from
the date of termination; (ii) in the case of a Tier 2 Employee, twelve (12)
months from the date of termination; (iii) in the case of a Tier 3 Employee,
six
(6) months from the date of termination; and (iv) in the case of a Tier 4
Employee, two (2) weeks for every Completed Year of Service, up to a maximum
of
26 weeks from the date of termination.
1.32“Specified
Employee”shall
mean a Participant who, as of the date of his or her Separation from Service,
is
deemed to be a “specified employee” within the meaning of that term under
Section 409A(a)(2)(B) of the Code and using the identification methodology
selected by the Employer from time to time in accordance therewith, or if none,
the default methodology set forth therein.
1.33“Tier
1 Employee”
shall
mean the Chief Executive Officer of the Employer and any officer who is subject
to Section 16 of the Exchange Act, and any other employee of the Employer as
designated by the Company.
1.34“Tier
2 Employee”
shall
mean any Senior Vice President or Studio Head of the Employer, and any other
employee of the Employer as designated by the Company.
1.35“Tier
3 Employee”
shall
mean any Vice President of the Employer, and any other employee of the Employer
as designated by the Company.
1.36“Tier
4 Employee”
shall
mean an employee of the Employer who is not a Tier 1 Employee, Tier 2 Employee
or Tier 3 Employee.
5
ARTICLE
II
SEVERANCE
BENEFITS
2.1Eligibility
for Severance Benefits.
(a)Qualifying
Event for a Tier 1 Employee, Tier 2 Employee or Tier 3 Employee.
In the
event that during the period commencing on the date of the Change in Control
and
ending twelve (12) months thereafter, the employment of a Tier 1 Employee,
Tier
2 Employee or Tier 3 Employee is terminated by the Employer without Cause or
by
the Participant for Good Reason, then the Employer shall pay or provide the
Participant with the Severance Benefits.
(b)Qualifying
Event for a Tier 4 Employee.
In the
event that during the period commencing on the date of the Change in Control
and
ending twelve (12) months thereafter, the employment of a Tier 4 Employee is
terminated by the Employer without Cause, then the Employer shall pay or provide
the Participant with the Severance Benefits.
(c)Non-Qualifying
Events.
A
Participant shall not be entitled to Severance Benefits under the Plan if the
Participant’s employment is terminated (i) by the Employer for Cause, (ii) by a
Tier 1 Employee, Tier 2 Employee or Tier 3 Employee for any reason other than
for Good Reason, (iii) by a Tier 4 Employee for any reason, or (iv) on account
of the Participant’s death or Disability.
2.2Amount
of Severance Benefits.
Unless
otherwise determined by the Committee at the time of termination, in the event
that a Participant becomes entitled to benefits pursuant to
Section 2.1
hereof,
the Employer shall pay or provide the Participant with the Severance Benefits
as
follows:
(a)Severance
Payment.
Subject
to the provisions of Sections 2.3
through
2.9, during the applicable Severance Period the Employer shall pay to the
Participant an amount determined as follows:
Tier
1 Employees
1.5
times the Participant’s Base Salary plus Bonus
Tier
2 Employees
1.0
times the Participant’s Base Salary plus Bonus
Tier
3 Employees
0.5
times the Participant’s Base Salary plus Bonus
Tier
4 Employees
2
weeks of the Participant’s Base Salary for every Completed Year of
Service, up to a maximum of 26
weeks
Such
amount shall be payable in installments in accordance with the Employer’s normal
payroll practices (but off employee payroll). Notwithstanding the foregoing
or
anything in the Plan to the contrary, payment of the foregoing amounts shall
be
subject to Section 7.8(b)
hereof; provided, that with respect to any Participant for who Section 1.23(g)
of the Plan does not apply, the six-month delay set forth in Section 7.8(b)
shall only be applied to amounts in excess of the Separation Pay
Limit.
6
(b)Continued
Health Coverage.
Subject
to the provisions of Sections 2.3
through
2.9 and a timely election pursuant to COBRA by a Tier 1 Employee, Tier 2
Employee or Tier 3 Employee, during the applicable Continuation Period the
Company shall pay the full cost for continued coverage pursuant to COBRA, for
the Participant and the Participant’s eligible dependents, under the Employer’s
group health plans in which the Participant participated immediately prior
to
the date of termination of the Participant’s employment. Following the
applicable Continuation Period, the Participant shall be entitled to such
continued coverage for the remainder of the COBRA period on a full self-pay
basis to the extent eligible under COBRA. For the avoidance of doubt, Tier
4
Employees shall not be entitled to the benefit provided under the first sentence
of this Section 2.2(b), but shall be entitled to continued coverage pursuant
to
COBRA under the Employer’s group health plans in which the Participant
participated immediately prior to the date of termination of the Participant’s
employment on a full self-pay basis to the extent eligible and subject to the
Participant’s timely election pursuant to COBRA.
(c)Accelerated
Vesting of Equity Awards.
Subject
to the provisions of Sections 2.3
and 2.4
and Sections 2.6 through 2.9, to the extent not vested immediately prior to
a
Change in Control, all stock based awards granted to the Participant prior
to
the Change in Control under the Company’s 2002 Stock Option Plan or Incentive
Stock Plan, each as amended, or any successor plan(s) thereto, that are
outstanding as of the date of the Change in Control shall become fully vested
as
of the effective date of the Participant’s termination.
Any
stock option, stock appreciation right or similar award that provides for a
Participant elected exercise shall become fully exercisable and will remain
exercisable for the applicable period following termination specified in the
applicable equity plan and/or the applicable award agreement. In the case of
restricted stock or similar awards that are not subject to a Participant elected
exercise, the Company shall remove any restrictions (other than restrictions
required by Federal securities law) or conditions in respect of such award
as of
the effective date of the Participant’s termination. For the avoidance of doubt,
this Section shall apply to any equity awards that, in connection with a Change
in Control, are given in replacement of the equity awards held by the
Participant immediately prior to the Change in Control.
2.3Effect
of Prior Agreements. In
the
event that a Participant is entitled to severance payments and benefits upon
termination under an Individual Severance Agreement, the Participant shall
be
entitled to, on a benefit-by-benefit basis, severance payments and benefits
equal to the greater of the Severance Benefits hereunder and the applicable
payments and benefits provided under such Individual Severance Agreement;
provided that the foregoing shall not otherwise affect the Participant’s rights
under the Plan or such Individual Severance Agreement. Notwithstanding
anything herein to the contrary, if a Participant has an Individual Severance
Agreement that provides for severance payments to be paid in a single lump
sum,
then in lieu of the Severance Payments to be paid to the Participant under
Section 2.2(a) above, the Participant shall receive an amount equal to the
sum
of the Base Salary plus Bonus (if applicable) that the Participant would have
otherwise received during the applicable Severance Period paid in a single
lump
sum on the 60th
day
following the date the Participant’s employment terminates, subject to Sections
2.4 through 2.9 and Section 7.8(b)
hereof; provided, that with respect to any Participant for who Section 1.23(g)
of the Plan does not apply, the six-month delay set forth in Section 7.8(b)
shall only be applied to amounts in excess of the Separation Pay
Limit.
7
2.4No
Duty to Mitigate/Set-off.
No
Participant entitled to receive Severance Benefits hereunder shall be required
to seek other employment or to attempt in any way to reduce any amounts payable
to the Participant by the Employer pursuant to the Plan and, except as provided
in Sections 2.2(b)
hereof,
there shall be no offset against any amounts due to the Participant under the
Plan on account of any remuneration attributable to any subsequent employment
that the Participant may obtain or otherwise. The amounts payable hereunder
shall not be subject to setoff, counterclaim, recoupment, defense or other
right
which the Employer may have against the Participant. In the event of the
Participant’s breach of any provision hereunder, including without limitation,
Sections 2.5
(other
than as it applies to a release of claims under the Age Discrimination in
Employment Act, as amended), 2.7
and 2.8
hereof,
the Company shall be entitled to recover any payments previously made to the
Participant hereunder. Severance Benefits shall be reduced (offset) by any
amounts payable under any statutory entitlement (including notice of
termination, termination pay and/or severance pay) of the Participant upon
a
termination of employment, including, without limitation, any payments related
to an actual or potential liability under the Worker Adjustment and Retraining
Notification Act (WARN) or similar state or local law.
2.5Release
Required.
Any
amounts payable pursuant to the Plan shall be conditioned upon the Participant’s
execution and non-revocation, within sixty (60) days following the effective
date of termination, of a release in the form attached as Appendix
B
hereto
(with such changes thereon as are legally necessary at the time of execution
to
make it enforceable).
The
Company shall provide the release to the Participant within seven (7) days
following the Participant’s date of termination. The Participant will be
required to sign the release within 45 days after the date it is provided to
him
or her and not revoke it within the seven (7) day period following the date
on
which it is signed. All payments delayed pursuant to this Section 2.5, except
to
the extent delayed pursuant to Section 7.8(b), shall be paid to the Participant
in a lump sum on the first Company payroll date on or following the
60th
day
after the Participant’s date of termination, and any remaining payments due to
the Participant under the Plan shall be paid or provided in accordance with
the
normal payment dates specified for them herein.
2.6Code
Section 280G.
(a)
Notwithstanding anything in the Plan to the contrary, in the event that any
payment or distribution by the Company to or for the benefit of a Participant,
whether paid or payable or distributed or distributable pursuant to the terms
of
the Plan or pursuant to any other plan, arrangement or agreement with the
Employer or its affiliates, would be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise
Tax”),
then
the amounts of the Severance Benefits payable under the Plan (each a
“Payment”)
shall
be automatically reduced to an amount one dollar ($1) less than an amount that
would subject the Participant to the Excise Tax; provided, however, that the
foregoing reduction shall be made only if and to the extent that such reduction
would result in an increase in the aggregate Payment to be provided, determined
on a net after-tax basis (taking into account the Excise Tax, imposed, any
tax
imposed by any comparable provision of state law, and any applicable federal,
state and local income taxes). Notwithstanding the foregoing, if a Participant
has a right to a gross-up payment with respect to the Excise Tax pursuant to
an
employment agreement or other arrangement or plan, the foregoing reduction
shall
not apply to amounts payable to the Participant and the terms of such employment
agreement or other arrangement or plan shall control.
8
(b) All
determinations required to be made under this Section 2.6,
including whether an Excise Tax is payable by the Participant and the amount
of
such Excise Tax shall be made by a nationally recognized accounting firm or
actuarial, benefits or compensation consulting firm (with experience in
performing the calculations regarding the applicability of Section 280G of
the
Code and the Excise Tax) (the “Accountant”)
selected by the Company. The Company shall be responsible for all charges of
the
Accountant.
2.7Restrictive
Covenants.
By
accepting the Severance Benefits under the Plan, each Tier 1 Employee, Tier
2
Employee and Tier 3 Employee who is a Participant is deemed to acknowledge
that
the restrictive covenants (including, without limitation, confidentiality and
non-competition) in any other agreement with the Employer previously signed
by
such Participant shall not be affected by the Plan and that the restrictive
covenants therein shall continue to apply after a Change in Control or a
termination of employment after a Change in Control in accordance with the
terms
of such restrictive covenants. As a condition to receiving Severance Benefits,
such Participant shall be required to acknowledge and agree that the payment
of
Severance Benefits is subject to the enforcement of such restrictive
covenants.
2.8Cooperation.
By
accepting the Severance Benefits under the Plan, subject to the Participant’s
other commitments, the Participant agrees to be reasonably available to
cooperate (but only truthfully) with the Employer and provide information as
to
matters which the Participant was personally involved, or has information on,
during the Participant’s employment with the Employer and which are or become
the subject of litigation or other dispute.
2.9Application
of the Plan to Foreign Participants.
Notwithstanding anything in the Plan to the contrary, the Severance Benefits
provided hereunder to Foreign Participants shall be reduced by any statutory
benefit that the Participant is entitled to receive upon a termination of
employment in accordance with applicable law. For the avoidance of doubt, the
provisions of the Plan shall not limit a Foreign Participant’s rights to receive
any statutory benefit that the Participant is entitled to receive upon a
termination of employment in accordance with applicable law.
ARTICLE
III
UNFUNDED
PLAN
3.1Unfunded
Status.
The Plan
shall be “unfunded” for the purposes of ERISA and the Code and Severance
Payments shall be paid out of the general assets of the Employer as and when
Severance Payments are payable under the Plan. All Participants shall be solely
unsecured general creditors of the Employer. If the Employer decides in its
sole
discretion to establish any advance accrued reserve on its books against the
future expense of the Severance Payments payable hereunder, or if the Employer
decides in its sole discretion to fund a trust under the Plan, such reserve
or
trust shall not under any circumstances be deemed to be an asset of the
Plan.
9
ARTICLE
IV
ADMINISTRATION
OF THE PLAN
4.1Plan
Administrator.
The
general administration of the Plan on behalf of the Employer (as plan
administrator under Section 3(16)(A) of ERISA) shall be placed with the
Committee.
4.2Reimbursement
of Expenses of Plan Committee.
The
Employer may, in its sole discretion, pay or reimburse the members of the
Committee for all reasonable expenses incurred in connection with their duties
hereunder, including, without limitation, expenses of outside legal
counsel.
4.3Action
by the Plan Committee.
Decisions of the Committee shall be made by a majority of its members attending
a meeting at which a quorum is present (which meeting may be held
telephonically), or by written action in accordance with applicable law. Subject
to the terms of the Plan and provided that the Committee acts in good faith,
the
Committee shall have complete authority to determine a Participant’s
participation and Severance Benefits under the Plan, to interpret and construe
the provisions of the Plan, and to make decisions in all disputes involving
the
rights of any person interested in the Plan.
4.4Delegation
of Authority.
Subject
to the limitations of applicable law, the Committee may delegate any and all
of
its powers and responsibilities hereunder to other persons by formal resolution
filed with and accepted by the Board. Any such delegation shall not be effective
until it is accepted by the Board and the persons designated, and may be
rescinded at any time by written notice from the Committee to the person to
whom
the delegation is made.
4.5Retention
of Professional Assistance.
The
Committee may employ such legal counsel, accountants and other persons as may
be
required in carrying out its work in connection with the Plan.
4.6Accounts
and Records.
The
Committee shall maintain such accounts and records regarding the fiscal and
other transactions of the Plan and such other data as may be required to carry
out its functions under the Plan and to comply with all applicable
laws.
4.7Indemnification.
The
Committee, its members and any person designated pursuant to Section 4.4 above
shall not be liable for any action or determination made in good faith with
respect to the Plan. The Employer shall, to the fullest extent permitted by
law,
indemnify and hold harmless each member of the Committee and each director,
officer and employee of the Employer for liabilities or expenses they and each
of them incur in carrying out their respective duties under the Plan, other
than
for any liabilities or expenses arising out of such individual’s willful
misconduct or fraud.
10
ARTICLE
V
AMENDMENT
AND TERMINATION
5.1Amendment
and Termination.
The
Company reserves the right to amend or terminate, in whole or in part, any
or
all of the provisions of the Plan by action of the Board (or a duly authorized
committee thereof) at any time, provided that in no event shall any amendment
reducing the Severance Benefits provided hereunder or any Plan termination
be
effective prior to the eighteen (18) month anniversary of the Effective Date,
and further provided that the Company shall not amend or terminate the Plan
at
any time after (i) the occurrence of a Change in Control or (ii) the date the
Company enters into a definitive agreement which, if consummated, would result
in a Change in Control, unless the potential Change in Control is abandoned
(as
publicly announced by the Company), in either case until eighteen (18) months
after the occurrence of a Change in Control, provided that all Severance
Benefits under the Plan have been paid.
ARTICLE
VI
SUCCESSORS
For
purposes of the Plan, the Company shall include any and all successors or
assignees, whether direct or indirect, by purchase, merger, consolidation or
otherwise, to all or substantially all the business or assets of the Company
and
such successors and assignees shall perform the Company’s obligations under the
Plan, in the same manner and to the same extent that the Company would be
required to perform if no such succession or assignment had taken place. In
the
event the surviving corporation in any transaction to which the Company is
a
party is a subsidiary of another corporation, then the ultimate parent
corporation of such surviving corporation shall cause the surviving corporation
to perform the Plan in the same manner and to the same extent that the Company
would be required to perform if no such succession or assignment had taken
place. In such event, the term “Company,” as used in the Plan, shall mean the
Company, as hereinbefore defined and any successor or assignee (including the
ultimate parent corporation) to the business or assets which by reason hereof
becomes bound by the terms and provisions of the Plan.
ARTICLE
VII
MISCELLANEOUS
7.1Minors
and Incompetents.
If the
Committee shall find that any person to whom Severance Benefits are payable
under the Plan is unable to care for his or her affairs because of illness
or
accident, or is a minor, any Severance Benefits due (unless a prior claim
therefore shall have been made by a duly appointed guardian, committee or other
legal representative) may be paid to the spouse, child, parent, or brother
or
sister, or to any person deemed by the Committee to have incurred expense for
such person otherwise entitled to the Benefits, in such manner and proportions
as the Committee may determine in its sole discretion. Any such Severance
Benefits shall be a complete discharge of the liabilities of the Employer,
the
Committee and the Board under the Plan.
7.2Limitation
of Rights.
Nothing
contained herein shall be construed as conferring upon a Participant the right
to continue in the employ of the Employer as an employee in any other capacity
or to interfere with the Employer’s right to discharge him or her at any time
for any reason whatsoever.
11
7.3Payment
Not Salary.
Any
Severance Benefits payable under the Plan shall not be deemed salary or other
compensation to the Participant for the purposes of computing benefits to which
he or she may be entitled under any pension plan or other arrangement of the
Employer maintained for the benefit of its employees, unless such plan or
arrangement provides otherwise.
7.4Severability.
In case
any provision of the Plan shall be illegal or invalid for any reason, said
illegality or invalidity shall not affect the remaining parts hereof, but the
Plan shall be construed and enforced as if such illegal and invalid provision
never existed.
7.5Withholding.
The
Employer shall have the right to make such provisions as it deems necessary
or
appropriate to satisfy any obligations it may have to withhold federal, state
or
local income or other taxes incurred by reason of payments pursuant to the
Plan.
In lieu thereof, the Company and/or the Employer shall have the right to
withhold the amounts of such taxes from any other sums due or to become due
from
the Company and/or the Employer to the Participant upon such terms and
conditions as the Committee may prescribe.
7.6Non-Alienation
of Benefits.
The
Severance Benefits payable under the Plan shall not be subject to alienation,
transfer, assignment, garnishment, execution or levy of any kind, and any
attempt to cause any Severance Benefits to be so subjected shall not be
recognized.
7.7Governing
Law.
To the
extent legally required, the Code and ERISA shall govern the Plan and, if any
provision hereof is in violation of any applicable requirement thereof, the
Company reserves the right to retroactively amend the Plan to comply therewith.
To the extent not governed by the Code and ERISA, the Plan shall be governed
by
the laws of the State of New York, without reference to rules relating to
conflicts of law.
7.8Code
Section 409A.
(a)General.
Although the Company makes no guarantee with respect to the tax treatment of
payments hereunder and shall
not
be responsible in any event with regard to non-compliance with Code Section
409A, the
Plan
is intended to either comply with, or be exempt from, the requirements of Code
Section 409A. To the extent that the Plan is not exempt from the requirements
of
Code Section 409A, the Plan is intended to comply with the requirements of
Code
Section 409A and shall be limited, construed and interpreted in accordance
with
such intent. Accordingly, the Company reserves the right to amend the provisions
of the Plan at any time and in any manner without the consent of Participants
solely to comply with the requirements of Code Section 409A and to avoid the
imposition of an excise tax under Code Section 409A on any payment to be made
hereunder, provided that there is no reduction in the Severance Benefits
hereunder. Notwithstanding the foregoing, in no event whatsoever shall the
Employer be liable for any additional tax, interest or penalty that may be
imposed on a Participant by Code Section 409A or any damages for failing to
comply with Code Section 409A.
12
(b)Separation
from Service; Specified Employees.
A
termination of employment shall not be deemed to have occurred for purposes
of
any provision of the Plan providing for the payment of any amounts or benefits
upon or following a termination of employment unless such termination is also
a
Separation from Service. If a Participant is deemed on the date of termination
to be a Specified Employee, then with regard to any payment that is specified
as
subject to this Section, such payment shall not be made prior to the expiration
of the Delay Period. All payments delayed pursuant to this
Section 7.8(b)
(whether
they would have otherwise been payable in a single lump sum or in installments
in the absence of such delay) shall be paid to the Participant in a single
lump
sum on the first Company payroll date on or following the first day following
the expiration of the Delay Period, and any remaining payments and benefits
due
under the Plan shall be paid or provided in accordance with the normal payment
dates specified for them herein.
7.9Non-Exclusivity.
The
adoption of the Plan by the Company shall not be construed as creating any
limitations on the power of the Company to adopt such other supplemental
retirement income arrangements as it deems desirable, and such arrangements
may
be either generally applicable or limited in application.
7.10Non-Employment.
The Plan
is not an agreement of employment and it shall not grant the Participant any
rights of employment.
7.11Headings
and Captions.
The
headings and captions herein are provided for reference and convenience only.
They shall not be considered part of the Plan and shall not be employed in
the
construction of the Plan.
7.12Gender
and Number.
Whenever
used in the Plan, the masculine shall be deemed to include the feminine and
the
singular shall be deemed to include the plural, unless the context clearly
indicates otherwise.
7.13Communications.
All
announcements, notices and other communications regarding the Plan will be
made
by the Employer in writing.
ARTICLE
VIII
WHAT
ELSE A PARTICIPANT NEEDS
TO
KNOW ABOUT THE PLAN
8.1Claims
Procedure. Any
claim
by a Participant with respect to eligibility, participation, contributions,
benefits or other aspects of the operation of the Plan shall be made in writing
to a person designated by the Committee from time to time for such purpose.
If
the designated person receiving a claim believes, following consultation with
the Chairman of the Committee, that the claim should be denied, he or she shall
notify the Participant in writing of the denial of the claim within ninety
(90)
days after his or her receipt thereof. This period may be extended an additional
ninety (90) days in special circumstances and, in such event, the Participant
shall be notified in writing of the extension, the special circumstances
requiring the extension of time and the date by which the Committee expects
to
make a determination with respect to the claim. If the extension is required
due
to the Participant’s failure to submit information necessary to decide the
claim, the period for making the determination will be tolled from the date
on
which the extension notice is sent until the date on which the Participant
responds to the Plan’s request for information.
13
If
a
claim is denied in whole or in part, or any adverse benefit determination is
made with respect to the claim, the Participant will be provided with a written
notice setting forth (a) the specific reason or reasons for the denial making
reference to the pertinent provisions of the Plan or of Plan documents on which
the denial is based, (b) a description of any additional material or information
necessary to perfect or evaluate the claim, and explain why such material or
information, if any, is necessary, and (c) inform the Participant of his or
her
right to request review of the decision. The notice shall also provide an
explanation of the Plan’s claims review procedure and the time limits applicable
to such procedure, as well as a statement of the Participant’s right to bring a
civil action under Section 502(a) of ERISA following an adverse benefit
determination on review. If a Participant is not notified (of the denial or
an
extension) within ninety (90) days from the date the Participant notifies the
Plan Administrator, the Participant may request a review of the application
as
if the claim had been denied.
A
Participant may appeal the denial of a claim by submitting a written request
for
review to the Committee, within
sixty (60) days
after
written notification of denial is received. Receipt of such denial shall be
deemed to have occurred if the notice of denial is sent via first class mail
to
the Participant’s last
shown
address on the books of the Employer. Such
period may be extended by the Committee for good cause shown. The claim will
then be reviewed by the Committee. In connection with this appeal, the
Participant (or his or her duly authorized representative) may (a) be provided,
upon written request and free of charge, with reasonable access to (and copies
of) all documents, records, and other information relevant to the claim, and
(b)
submit to the Committee written comments, documents, records, and other
information related to the claim. If the Committee deems it appropriate, it
may
hold a hearing as to a claim. If a hearing is held, the Participant shall be
entitled to be represented by counsel.
The
review by the Committee will take into account all comments, documents, records,
and other information the Participant submits relating to the claim. The
Committee will make a final written decision on a claim review, in most cases
within sixty (60) days after receipt of a request for a review. In some cases,
the claim may take more time to review, and an additional processing period
of
up to sixty (60) days may be required. If that happens, the Participant will
receive a written notice of that fact, which will also indicate the special
circumstances requiring the extension of time and the date by which the
Committee expects to make a determination with respect to the claim. If the
extension is required due to the Participant’s failure to submit information
necessary to decide the claim, the period for making the determination will
be
tolled from the date on which the extension notice is sent to the Participant
until the date on which the Participant responds to the Plan’s request for
information.
14
The
Committee decision on the claim for review will be communicated to the
Participant in writing. If an adverse benefit determination is made with respect
to the claim, the notice will include: (a) the specific reason(s) for any
adverse benefit determination, with references to the specific Plan provisions
on which the determination is based; (b) a statement that the Participant is
entitled to receive, upon request and free of charge, reasonable access to
(and
copies of) all documents, records and other information relevant to the claim;
and (c) a statement of the Participant’s right to bring a civil action under
Section 502(a) of ERISA. A Participant may not start a lawsuit to obtain
benefits until after he or she has requested a review and a final decision
has
been reached on review, or until the appropriate timeframe described above
has
elapsed since the Participant filed a request for review and the Participant
has
not received a final decision or notice that an extension will be necessary
to
reach a final decision. These procedures must be exhausted before a Participant
(or any beneficiary) may bring a legal action seeking payment of benefits.
In
addition, no lawsuit may be started more than two years after the date on which
the applicable appeal was denied. If there is no decision on appeal, no lawsuit
may be started more than two years after the time when the Committee should
have
decided the appeal. The law also permits the Participant to pursue his or her
remedies under Section 502(a) of ERISA without exhausting these appeal
procedures if the Plan has failed to follow them.
8.2Plan
Interpretation and Benefit Determination. This
Section 8.2 shall only apply with respect to Tier 4 Employees. The Committee
(or, where applicable, any duly authorized delegee of the Committee) shall
have
the exclusive right, power, and authority, in its sole and absolute discretion,
to administer, apply and interpret the Plan and any other documents, and to
decide all factual and legal matters arising in connection with the operation
or
administration of the Plan.
Without
limiting the generality of the foregoing, the Committee (or, where applicable,
any duly authorized delegee of the Committee) shall have the sole and absolute
discretionary authority to:
(a) take
all
actions and make all decisions (including factual decisions) with respect to
the
eligibility for, and the amount of, benefits payable under the
Plan;
(b) formulate,
interpret and apply rules, regulations and policies necessary to administer
the
Plan;
(c) decide
questions, including legal or factual questions, relating to the calculation
and
payment of benefits, and all other determinations made, under the
Plan;
(d) resolve
and/or clarify any factual or other ambiguities, inconsistencies and omissions
arising under the Plan or other Plan documents; and
(e) process,
and approve or deny, benefit claims and rule on any benefit
exclusions.
All
determinations made by the Committee (or, where applicable, any duly authorized
delegee of the Committee) with respect to any matter arising under the Plan
shall be final and binding on the Employer, the Participant, any beneficiary,
and all other parties affected thereby.
8.3Statement
of Participants Rights Under ERISA.
Participants
in the Plan are entitled to certain rights and protections under ERISA. ERISA
provides that all Participants in the Plan shall be entitled to:
15
(a)Receive
Information About the Plan and Plan Benefits.
(i) Examine,
without charge, at the Committee’s office and at other specified locations, such
as worksites, all documents governing the Plan, including insurance contracts,
and a copy of the latest annual report (Form 5500 Series), if any, filed by
the
Plan with the U.S. Department of Labor and available at the Public Disclosure
Room of the Employee Benefits Security Administration.
(ii) Obtain,
upon written request to the Committee, copies of documents governing the
operation of the Plan, including insurance contracts, and copies of the latest
annual report (Form 5500 Series), if any, and updated summary plan description.
The Committee may make a reasonable charge for the copies.
(iii) Receive
a
summary of the Plan’s annual financial report (if any). The Committee is
required by law to furnish each Participant with a copy of this summary annual
report.
(b)Prudent
Actions by Plan Fiduciaries.
In
addition to creating rights for Participants in the Plan, ERISA imposes duties
upon the people who are responsible for the operation of the employee benefit
plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a
duty to do so prudently and in the interest of Participants and other Plan
beneficiaries. No one, including the Employer or any other person, may fire
a
Participant or otherwise discriminate against a Participant in any way to
prevent a Participant from obtaining a welfare benefit or exercising a
Participant’s rights under ERISA.
(c)Enforce
a Participant’s Rights.
(i) If
a
Participant’s claim for a welfare benefit is denied or ignored, in whole or in
part, a Participant has a right to know why this was done, to obtain copies
of
documents relating to the decision without charge, and to appeal any denial,
all
within certain time schedules.
(ii) Under
ERISA, there are steps a Participant can take to enforce the above rights.
For
instance, if a Participant requests a copy of Plan documents or the latest
annual report from the Plan and does not receive them within 30 days, a
Participant may file suit in a Federal court. In such a case, the court may
require the Committee to provide materials and pay the Participant up to $110
per day until the Participant receives the materials, unless the materials
were
not sent because of reasons beyond the control of the Committee. If a
Participant has a claim for benefits which is denied or ignored, in whole or
in
part, after a Participant has exhausted the Plan’s claim and review procedures
described above, a Participant may file suit in a state or Federal court. If
a
Participant is discriminated against for asserting a Participant’s rights, a
Participant may seek assistance from the U.S. Department of Labor, or a
Participant may file suit in a Federal court. The court will decide who should
pay court costs and legal fees. If a Participant is successful, the court may
order the person that the Participant has sued to pay these costs and fees.
If a
Participant loses, the court may order the Participant to pay these costs and
fees, for example, if it finds the Participant’s claim is
frivolous.
16
(d)Assistance
with Your Questions.
If a
Participant has any questions about the Plan, the Participant should contact
the
Committee. If a Participant has any questions about this statement or about
the
Participant’s rights under ERISA, or if a Participant needs assistance in
obtaining documents from the Committee, the Participant should contact the
nearest office of the Employee Benefits Security Administration, U.S. Department
of Labor, listed in the Participant’s telephone directory or the Division of
Technical Assistance and Inquiries, Employee Benefits Security Administration,
U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C.20210.
A Participant may also obtain certain publications about a Participant’s rights
and responsibilities under ERISA by calling the publications hotline of the
Employee Benefits Security Administration.
8.4Plan
Document.
This
document shall constitute both the Plan document and summary plan description
and shall be distributed to all Participants in this form.
8.5Other
Important Facts.
OFFICIAL
NAME OF THE PLAN:
Take-Two
Interactive Software, Inc. Change in Control Employee Severance
Plan
The
Committee keeps records of the Plan and is responsible for the administration
of
the Plan. The Committee will also answer any questions a Participant may have
about the Plan.
Service
of legal process may be made upon the Committee (at the address above) or the
Company’s General Counsel.
No
individual may, in any case, become entitled to additional benefits or other
rights under the Plan after the Plan is terminated. Under no circumstances,
will
any benefit under the Plan ever vest or become nonforfeitable.
17
APPENDIX
A
CHANGE
IN CONTROL
A
“Change
in Control” shall be deemed to have occurred if any of the following shall have
occurred:
(a) upon
any
“person” as such term is used in Sections 13(d) and 14(d) of the
Exchange
Act (other than the Company, any trustee or other fiduciary holding securities
under any employee benefit plan of the Company, or any company owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of common stock of the Company), becoming the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly
or
indirectly, of securities of the Company representing 50% or more of: (A) the
then outstanding shares
of
common stock of the Company or (B) the combined voting power of the Company’s
then outstanding securities;
(b) during
any period of two consecutive years individuals who at the beginning of such
period constitute the Board and any new director (other than a director
designated by a person who has entered into an agreement with the Company to
effect a transaction described in paragraph (a), (c), or (d) of this Section
or
any a director whose initial assumption of office is in connection with an
actual or threatened election or other proxy contest, including but not limited
to a consent solicitation, relating to the election of directors to the Board)
whose election by the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds of the directors
then
still in office who either were directors at the beginning of the two-year
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority of the
Board;
(c) a
merger
or consolidation of the Company or a subsidiary with any other corporation,
other than a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities
of
the surviving entity) more than 50% of the combined voting power of the voting
securities of the Company or such surviving entity or such surviving entity’s
parent outstanding immediately after such merger or consolidation;
or
(d) upon
the
approval by the stockholders of the Company of a plan of an agreement for the
sale or disposition by the Company of all or substantially all of the Company’s
assets other than the sale or disposition of all or substantially all of the
assets of the Company to a person or persons who beneficially own, directly
or
indirectly, at least 50% or more of the combined voting power of the outstanding
voting securities of the Company at the time of the sale.
Only
one
Change in Control may occur under the Plan.
A
- 1
APPENDIX
B
AGREEMENT
AND
RELEASE
Take-Two
Interactive Software, Inc. (“Company”)
and
[name]
(“Employee”),
agree
to the terms and conditions set forth below:
1. Employee’s
employment with the Company is terminated as of ________________ ___, 20__
(the
“Termination
Date”).
Employee acknowledges that the Termination Date is the termination date of
[his/her] employment
for purposes of participation in and coverage under all benefit plans and
programs sponsored by or through the Company. Employee acknowledges and agrees
that the Company shall not have any obligation to rehire Employee, nor shall
the
Company have any obligation to consider [him/her]
for
employment, after the Termination Date.
2. In
exchange for the general release in paragraph 4 below and other promises
contained herein, and in accordance with the terms of the Take-Two
Interactive Software, Inc. Change in Control Employee Severance Plan
(“Severance
Plan”),
which
Employee hereby acknowledges receiving, including
without limitation, Section 7.8(b) of the Severance Plan to the extent
applicable, Employee will receive (collectively, the “Severance
Benefits”):
(a) [ADD
FOR
ALL PARTICIPANTS AS APPLICABLE]
a
Severance Payment (as defined in the Severance Plan) in the total gross amount
of $[amount]
(the
“Severance
Payment”),
which
shall be paid in accordance with the Company’s normal payroll practices (but off
employee payroll) [IF
CONTINUATION PAYMENTS
- in
substantially equal installments for a period of [For Tier 1 Employee - eighteen
(18) months] [For Tier 2 Employee - twelve (12) months] [For Tier 3 Employee
-
six (6) months] [For Tier 4 Employee - _______ weeks1 ]
from
the Termination Date [IF
LUMP SUM PAYMENT REQUIRED PURSUANT TO SECTION 2.3 OF THE SEVERANCE
PLAN
- in a
single cash lump sum payment on the sixtieth (60th)
day
following the Termination Date], subject to all applicable payroll withholding
deductions; and
(b) [ADD
FOR
TIER 1, 2 AND 3 EMPLOYEES AS APPLICABLE]
the
Continued Health Coverage (as defined in the Severance Plan) applicable to
Tier
[1/2/3] Employees pursuant to Section 2.2(b) of the Severance Plan.
3. Employee
hereby agrees and acknowledges that the Severance Benefits exceed any payment,
benefit or other thing of value to which Employee might otherwise be entitled
under any policy, plan or procedure of Company or its parent or affiliates
or
pursuant to any prior agreement or contract with Company or its parent or
affiliates.
1
Insert two (2) weeks for every Completed Year of Service (as defined in the
Severance Plan) by the employee, up to a maximum of 26 weeks.
B
- 1
4. (a) In
exchange for the Severance Benefits and other valuable consideration, Employee,
for [himself/herself]
and
for
[his/her]
heirs,
executors, administrators and assigns (referred to collectively as “Releasors”),
forever releases and discharges Company and any and all of Company’s parent
companies, partners, subsidiaries, affiliates, successors and assigns and any
and all of its and their past and/or present officers, directors, partners,
agents, employees, representatives, counsel, employee benefit plans and their
fiduciaries and administrators, successors and assigns (referred to collectively
as the “Releasees”),
from
any and all claims, demands, causes of action, fees and liabilities of any
kind
whatsoever, whether known or unknown, which Releasors ever had, now have or
may
have against Releasees by reason of any actual or alleged act, omission,
transaction, practice, conduct, occurrence or other matter up to and including
the date Employee signs this Agreement and
Release.
(b) Without
limiting the generality of the foregoing, this Agreement and
Release is intended to and shall release Releasees from any and all claims,
whether known or unknown, that Releasors ever had, now have or may have against
Releasees arising out of Employee’s employment with Company or any of the
Releasees, the terms and conditions of such employment and/or the termination
of
such employment, including but not limited to: any claim under the Age
Discrimination in Employment Act, as amended (“ADEA”),
and/or the Older Workers Benefit Protection Act which laws prohibit
discrimination on account of age; (ii) any claim under Title VII of the
Civil Rights Act of 1964, as amended, which, among other things, prohibits
discrimination/retaliation on account of race, color, religion, sex, and
national origin; (iii) any claim under the Americans with Disabilities Act
(“ADA”)
or
Sections 503 and 504 of the Rehabilitation Act of 1973, each as amended;
(iv) any claim under the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”);
(v) any claim under the Family and Medical Leave Act; (vi) any claim
or other action under the National Labor Relations Act, as amended; (vii) any
claim under the Workers’ Adjustment and Retraining Notification Act;
(viii) any claim under the New York State Human Rights Law, the New York
Executive Law, the New York Labor Law, the New York City Administrative Code
or
any other applicable state or local labor or human rights laws; (ix) the
Sarbanes-Oxley Act of 2002; (x) any other claim of discrimination,
harassment or retaliation in employment (whether based on federal, state or
local law, regulation, or decision; (xi) any other claim (whether based on
federal, state or local law, statutory or decisional) arising out of the terms
and conditions of Employee’s employment with and termination from the Company
and/or the Released Parties; (xii) any claims for wrongful discharge,
whistleblowing, constructive discharge, promissory estoppel, detrimental
reliance, negligence, defamation, emotional distress, compensatory or punitive
damages, and/or equitable relief; (xiii) any claims under federal, state,
or local occupational safety and health laws or regulations, all as amended;
and
(xiv) any claim for attorneys' fees, costs, disbursements and/or the
like.
By
virtue of the foregoing, Employee agrees that [he/she]
has
waived any damages and other relief available to [him/her]
(including, without limitation, money damages, equitable relief and
reinstatement) under the claims waived in this paragraph 4. Notwithstanding
anything herein to the contrary, the sole matters to which this Agreement of
Release does not apply are: (i)
claims
to the Severance Benefits, (ii) claims under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended, (iii) claims arising after the date
Employee signs this Agreement and Release,
(iv)
claims to vested accrued benefits under the Employer’s 401(k) or other tax
qualified retirement plans in accordance with the terms of such plans and
applicable law, (v) claims
relating to any rights of indemnification under the Company’s organizational
documents or otherwise, (vi) [or
claims
relating to any outstanding stock options or other equity-based award on the
Termination Date,]
or (vii)
claims relating to an approved, executed, agreement between the Company and
Employee that provides for specific severance in connection with a termination
of employment which such agreement has not expired or been replaced prior to
the
termination of the Employee’s employment. Employee acknowledges that Employee
has been informed that Employee might have specific rights and/or claims under
the ADEA. Employee specifically waives such rights and/or claims under the
ADEA
to the extent such rights and/or claims arose on or prior to the date this
Agreement of Release is executed by Employee.
B
- 2
5. Employee
agrees that at no time will [he/she]
engage
in any form of conduct or make any statements or representations that disparage
or otherwise impair the reputation, goodwill or commercial interests of the
Releasees. Nothing in this Agreement and Release shall prohibit or restrict
Employee from: (i) making any disclosure of information, as required by law,
in
a proceeding or lawsuit in which the Company is a party, or additionally in
any
other civil proceeding or lawsuit upon ten (10) business days prior written
notice to the Company; (ii) providing information to, or testifying or otherwise
assisting in an investigation or proceeding brought by any federal regulatory
or
law enforcement agency or legislative body or the Company’s designated legal,
compliance, or human resources officers; (iii) filing, testifying, participating
or otherwise assisting in a proceeding relating to an alleged violation of
any
federal, state or municipal law relating to fraud or any rule or regulation
of
the Securities and Exchange Commission; or (iv) challenging the validity of
this
Agreement and Release as it applies to a release of claims under
ADEA.
6. Employee
agrees to make [himself/herself]
reasonably available at times and for durations reasonably acceptable to both
parties to assist the Company with respect to any issues wherein the Company
considers Employee’s knowledge or expertise reasonably beneficial. The Company
will reimburse Employee for all reasonable out of pocket expenses that incurred
while [he/she]
is
engaged in such activity. Employee will also cooperate fully with the Company
in
the defense or prosecution of any claims or actions now in existence or which
may be brought in the future against or on behalf of the Company which relate
to
events or occurrences that transpired while the Employee was employed by the
Company. Employee’s full cooperation in connection with such claims or actions
shall include, but not be limited to, being available to meet with counsel
to
prepare for discovery or trial and to act as a witness on behalf of the Company
at mutually convenient times. Employee shall also cooperate fully with the
Company in connection with any such investigation or review of any federal,
state or local regulatory authority as any such investigation or review relates
to events or occurrences that transpired while Employee was employed by the
Company. The Company shall pay for any reasonable out-of-pocket expenses
incurred by Employee in connection with [his/her]
performance of the obligations pursuant to this paragraph 6. Employee’s
performance under this paragraph 6 following the Termination Date shall be
subject to [his/her]
then
current employment obligations.
7. Employee
represents that [he/she]
has
returned (or will return) to Company all property belonging to Company,
including but not limited to electronic devices (e.g., Blackberry and/or laptop
computer), keys, card access to buildings and office floors, and business
information and documents.
B
- 3
8. If
any
provision of this Agreement and Release is held to be illegal, void, or
unenforceable, such provision shall be of no force or effect. However, the
illegality or unenforceability of such provision shall have no effect upon,
and
shall not impair the enforceability of, any other provision of this Agreement
and
Release. Further, to the extent any provision of this Agreement and Release
is
deemed to be overbroad or unenforceable as written, such provision shall be
given the maximum effect permissible under law.
9. This
Agreement and
Release represents the entire understanding between the parties hereto with
respect to the subject matter hereof, and may not be changed or modified except
by a written agreement signed by both of the parties hereto after the Effective
Date of this Agreement and
Release. In the event of any conflict between any of the provisions of this
Agreement and
Release and the provisions of the Severance Plan, the terms of the Severance
Plan shall govern.
10. Except
as
may be preempted by federal law, this Agreement and
Release shall
be
governed by the laws of the State of New York, without regard to conflict
of
laws principles, and the parties in any action arising out of this Agreement
and
Release shall
be
subject to the personal jurisdiction and venue of the federal and state courts,
as applicable, in the County of New York, State of New York.
11. The
parties agree that this Agreement and Release and its terms are confidential
and
shall be accorded the utmost confidentiality. Employee
hereby agrees to keep confidential and not disclose the terms and conditions
of
this Agreement to any person or entity without the prior written consent of
the
Company, except to Employee’s accountants, attorneys and/or spouse, provided
that they also agree to maintain the confidentiality of this Agreement. Employee
shall be responsible for any disclosure by them. Employee further represent
that
Employee has not disclosed the terms and conditions of this Agreement to anyone
other than Employee’s attorneys, accountants and/or spouse. This Section 10 does
not prohibit disclosure of this Agreement by any party if required by law,
provided that if Employee is required to make such disclosure the Employee
has
given the Company prompt written notice of any legal process and cooperated
with
the Company’s efforts to seek a protective order.
12. Employee
acknowledges that during the course of Employee’s employment with the Company,
Employee has had access to information relating to the Company, its divisions,
subsidiaries, or related entities and its/their business that is not generally
known by persons not employed by the Company and that could not easily be
determined or learned by someone outside of the Company (“Confidential
Information”).
Such
information is confidential or proprietary and may include but not be limited
to
customer or client contact lists, trade secrets, patents, copyrighted materials,
proprietary computer software and programs, products, systems analyses, lists
of
suppliers and supplier contracts, internal policies and marketing strategies,
financial information relating to the Company and its employees, and other
documents and information that provide the Company with a competitive advantage
and that could not be easily determined or learned or obtained by someone
outside the Company. Employee further acknowledges that: (i) such confidential
and proprietary information is the exclusive, unique, and valuable property
of
the Company, its divisions, subsidiaries and/or related entities; (ii) the
businesses of the Company depend on such confidential and proprietary
information; and (iii) the Company wishes to protect such confidential and
proprietary information by keeping it confidential for the use and benefit
of
the Company, its subsidiaries, divisions, and/or related entities. Employee
agrees not to disclose or use such Confidential Information at any time in
the
future, except if authorized by the Company in writing or if required in
connection
with a subpoena or other legal process or investigation by any governmental,
regulatory or self-regulatory agency or in connection with any legal proceeding
brought against Employee, or in connection with a proceeding to enforce this
Agreement.
B
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13. Employee
agrees that for a period of six (6) months following Employee’s termination of
employment with the Company (the “Restricted
Period”),
Employee will not, directly or indirectly, individually or on behalf of any
other person, firm, corporation or other entity, solicit, induce, hire or retain
any employee of the Company to leave the employ of the Company or to accept
employment or retention as an independent contractor with, or render services
to
or with any other person, firm, corporation or other entity unaffiliated with
the Company or take any action to assist or aid any other person, firm,
corporation or other entity in identifying, soliciting, hiring or retaining
any
such employee (provided Employee may serve as a reference after he is no longer
employed by the Company but not with regard to any entity with which he is
affiliated or from which he is receiving compensation). Furthermore, during
the
Restricted Period, Employee will not (i) solicit or induce any customer or
client of the Company to purchase goods or services offered by the Company
from
another person, firm, corporation or other entity or assist or aid any other
persons or entity in identifying or soliciting any such customer or client,
(ii)
encourage any customer, client, supplier or other business relationship of
the
Company to terminate or alter such relationship, (iii) encourage any prospective
customer or supplier not to enter into a business relationship with the Company,
or (iv) impair or attempt to impair any relationship, contractual or otherwise,
written or oral, between the Company and any customer, supplier or other
business relationship.
14. Employee
acknowledges and agrees that the Company will suffer irreparable damage if
any
of the provisions of paragraphs 5, 12 or 13 of this Agreement and Release are
breached and that the Company’s remedies at law for a breach of such provisions
would be inadequate and, in recognition of this fact, Employee agrees that,
in
the event of such a breach, in addition to any remedies at law, the Company
will
be entitled to obtain equitable relief in the form of specific performance,
temporary restraining order, a temporary or permanent injunction or any other
equitable remedy which may then be available.
15. This
Agreement and
Release is binding upon, and shall inure to the benefit of, the parties and
their respective heirs, executors, administrators, successors and
assigns.
16. Employee
acknowledges that [he/she]:
(a) has
carefully read this Agreement and
Release in its entirety; (b) has had an opportunity to consider the terms of
this Agreement and
Release [insert
only if employees are over 40: and
the
disclosure information attached hereto as
Exhibit I (which is provided pursuant to the Older Workers Benefit Protection
Act)]
for at
least [twenty-one (21)] [forty-five (45)] days; (c) is hereby advised by Company
in writing to consult with an attorney of [his/her]
choice
in connection with this Agreement and
Release; (d) fully understands the significance of all of the terms and
conditions of this Agreement and
Release and has discussed them with an attorney of [his/her]
choice,
or has had a reasonable opportunity to do so; and (e) is signing this Agreement
and
Release voluntarily and of [his/her]
own free
will and agrees to abide by all the terms and conditions contained
herein.
B
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17. Employee
may accept this Agreement and
Release by signing it before a notary public and delivering it to [INSERT
NAME AND ADDRESS OF CONTACT]
on or
before the [twenty-first (21st)]
[forty-fifth (45th)]
day
after [he/she]
receives
this Agreement and
Release. Notwithstanding the foregoing, Employee may not sign this Agreement
and
Release before [his/her]
last day
of employment and this Agreement and
Release will not be accepted or effective if signed before the Termination
Date.
After signing this Agreement and
Release, Employee shall have seven (7) days (the “Revocation
Period”)
to
revoke [his/her]
decision
by indicating [his/her]
desire
to do so in writing delivered to [INSERT
NAME]
at the
above address by no later than the last day of the Revocation Period. If the
last day of the Revocation Period falls on a Saturday, Sunday or holiday, the
last day of the Revocation Period will be deemed to be the next business day.
Provided Employee does not revoke this Agreement and
Release during the Revocation Period, the Effective Date of this Agreement
and
Release shall be the later of the eighth (8th)
day
after Employee signs this Agreement and
Release or the
day
after
the last day of the Revocation Period (the “Effective
Date”).
Dated:
______________
(signature)
[Employee]
TAKE-TWO
INTERACTIVE SOFTWARE, INC.
Accepted
by:__________________________
Dated:_____________________
Name:_______________________________
B
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6
Dates Referenced Herein and Documents Incorporated by Reference
