Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On
In the event an Eligible Employee is terminated without cause and not in connection with a Change in Control, and the Eligible Employee timely executes a release of claims and complies with applicable restrictive covenants, the Eligible Employee will be entitled to: (1) cash installment payments at the rate of the Eligible Employee's base salary as of the date of termination ("Severance") over a period of 24 months, 18 months or 12 months, as applicable, for a Tier 1, Tier 2 or Tier 3 Eligible Employee, respectively; (2) the Eligible Employee's target bonus under the Company's Annual Incentive Program prorated to reflect the Eligible Employee's time of employment during the year in which the termination without cause occurs, which is payable when annual bonuses are paid to the Company's active employees; and (3) subject to the Eligible Employee's election, continued health and welfare coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), at a cost to the employee of no greater than the cost during the Eligible Employee's active employment, for a period of 24 months, 18 months or 12 months, as applicable, to the Eligible Employee's Tier, or, if earlier, that date the Eligible Employee is eligible for health and welfare coverage from a subsequent employer.
In the event an Eligible Employee has a Qualifying Termination within eighteen months after a Change in Control, and the Eligible Employee timely executes a release of claims and complies with applicable restrictive covenants, the Eligible Employee will be entitled to: (1) a lump sum cash payment equal to the Eligible Employee's base salary and target annual bonus as of the date of termination multiplied by 2.5, 2.0 or 1.5, as applicable, for a Tier 1, Tier 2 or Tier 3 Eligible Employee, respectively;
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and (2) subject to the Eligible Employee's election, continued health and welfare coverage under COBRA, at a cost to the Eligible Employee of no greater than the cost during the Eligible Employee's active employment, for a period of 30 months, 24 months or 18 months, as applicable, to the Eligible Employee's Tier, or, if earlier, that date the Eligible Employee is eligible for health and welfare coverage from a subsequent employer.
The Severance Plan provides that equity and long-term incentive awards will be treated in accordance with the applicable plan and award agreement terms upon a termination of employment.
Severance benefits under the Severance Plan are subject to the Eligible Employee's compliance with non-solicitation restrictions for 24 months after termination for all Eligible Employees and non-competition restrictions that apply for 24 months after termination for Tier 1 and Tier 2 Eligible Employees and 18 months after termination for Tier 3 Eligible Employees.
Each of our named executive officers will be offered the opportunity to enter into a participation agreement under the Severance Plan and have been designated to be in the Tier indicated below:
Named Executive Officer Severance Plan "Tier"Paul A. Sarvadi 1Douglas S. Sharp 2A. Steve Arizpe 2Jay E. Mincks 2Daniel D. Herink 2
The foregoing description is only a summary of the Severance Plan and Participation Agreement and is qualified in its entirety by the Severance Plan and Participation Agreement, which are filed as Exhibits 99.1 and 99.2 to this Current Report.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
99.1 -Insperity, Inc. Executive Severance Plan, effective as ofDecember 30, 2019 . 99.2 - Participation Agreement toInsperity, Inc. Executive Severance Plan.
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