Termination without cause by the company

A "Termination without cause" clause allows a company to terminate an employee's contract without needing to provide a specific reason. Typically, this clause requires the company to provide advance notice or compensation, such as severance pay, to the departing employee.

11 Termination without cause by the company examples

  • Description
    (b)    Termination without Cause by the Company. The Company may unilaterally terminate the employment of Executive at any time without Cause, as defined in Section 7, upon written notice. If Executive’s employment is terminated by the Company without Cause, then upon Executive’s signing (and non-revocation) of a separation agreement containing a plenary release of claims in a form acceptable to the Company (a “Release”), Executive shall be entitled to receive, in addition to all earned compensation through his Termination Date: (i) salary continuation at his then-current Base Salary for the greater of (A) twelve (12) months after the Termination Date or (B) the number of pay periods required by the Company’s Severance Pay Plan (the “Severance Payments”) and (ii) if, for the year in which Executive’s employment is terminated pursuant to this Section, the Company achieves the performance goals established in accordance with any incentive plan in which he participates, the Company shall pay Executive an amount equal to the bonus that he would have received had he been employed by the Company for the full year, multiplied by a fraction, the numerator of which is the number of calendar days Executive was employed in such year and the denominator of which is 365. Notwithstanding the foregoing, all Severance Payments not yet paid by March 15 of the calendar year following the Termination Date shall be paid in a lump sum on such March 15 or the first business day prior thereto. Upon a termination without Cause, Executive’s unvested long-term incentive awards will operate in accordance with the terms of their respective award agreements and governing equity plans.
    Document
    Enstar Group LTD (ESGR, ESGRO, ESGRP)
  • Description
    In the event that your continuous service with the Company terminates by reason of death, disability (as defined in the Stock Plan), termination without cause by the Company or termination for good reason (as such terms are defined in the Company’s Executive Separation Policy) by you prior to the end of the applicable performance cycles for the Supplemental LTIPs, you will be entitled to a prorated amount for each such Supplemental LTIP performance cycle that has not yet ended equal to the Supplemental LTIP payment that the Committee determines would have been paid to you had your employment continued through the end of the performance cycle, multiplied by a fraction, the numerator of which is the number of months of the performance cycle which have elapsed since the first day of the performance cycle to the end of the month in which your continuous service with the Company terminates by reason of death, disability, termination without cause by the Company or termination for good reason by you and the denominator of which is the total number of months in the performance cycle. The Supplemental LTIPs will not be payable in the event that a change in control occurs, except to the extent payable without a change in control or required under the Separation Policy.
    Document
    REPUBLIC SERVICES, INC. (RSG)
  • Description
    3.6  Termination Without Cause by the Company. If the Executive’s Continuous Service terminates as a result of termination without Cause by the Company, the Award shall become immediately vested with respect to 100% of the RSU’s subject to the Award.
    Document
    Orbital Infrastructure Group, Inc.
  • Description
    f.Effect of Termination upon Options. In the event that Executive's employment is terminated in a Termination Without Cause by the Company, in a Termination for Good Reason by the Executive, or pursuant to death or disability pursuant to Section 6(d) above, any stock options held by Executive at the time of such termination will be treated in accordance with the terms of the applicable Stock Option Award Agreement.
    Document
    KnowBe4, Inc.
  • Description
    (b) Termination by the Company Without Cause. Executive’s employment may also be terminated without Cause by the Company at any time. Upon Executive’s termination without Cause by the Company, the Company shall:     (i) Pay Executive the Accrued Compensation (as defined in Section 5(a) herein); and         (ii) Pay a “Severance Payment” (as defined hereinafter in this Section 5(b)).   The amount of the “Severance Payment” shall be determined as follows:     (iii) If termination occurs during the Initial Term, the Severance Payment shall be the amount equal to the greater of (a) three (3) times Executive’s Base Salary as of the termination date; and (b) three (3) times the total amount of Executive’s Bonus payments the Company paid Executive over the one (1) year prior to the termination date. All amounts due under this Section 5(b)(iii) shall be paid in substantially equal monthly installments over the course of the three (3) years following the termination date;         (iv) If termination occurs after the Initial Term, the Severance Payment shall be the amount equal to the greater of (a) one and one half (1.5) times Executive’s Base Salary as of the termination date; and (b) one and one half (1.5) times the total amount of Executive’s Bonus payments the Company paid Executive over the one (1) year prior to the termination date. All amounts due under this Section 5(b)(iv) shall be paid in substantially equal monthly installments over the course of eighteen (18) months following the termination date;
    Document
    Neuraxis, INC (NRXS)
  • Description
    The vesting of any performance share units or performance-based restricted stock or performance-based restricted stock unit awards shall vest according to the terms of the applicable award agreement in the case of Mr. Lawton’s termination due to death or disability or as a result of termination without cause by the Company or by Mr. Lawton for good reason.
    Document
    TRACTOR SUPPLY CO /DE/ (TSCO)
  • Description
    Upon Termination Without Cause by the Company or for Good Reason by you, the Company will (i) continue payment of your Base Salary for 12 months (which shall not be adjusted for any remaining employment term) and (ii) you will be entitled to COBRA benefits until the earlier of 12 months from the end of the month in which you are terminated or eligibility for benefits with another employer. You will also be entitled to your pro-rata target bonus for the year in which your termination occurs as well as any earned bonus for the prior year not yet paid. In addition, any unvested equity awards shall vest in full. Good Reason (including following a change in control) shall mean (i) reduction in your base salary, (ii) material reduction in responsibilities or job title, or (iii) Company requiring you to relocate more than 50 miles from the Company’s executive office.
    Document
    EzFill Holdings Inc (EZFL)
  • Description
    (b) Termination without Cause by the Company, Termination by Executive due to Material Breach of the Agreement by the Company, or due to the Death of Executive.  In the event: (a) the Company terminates Executive’s employment without Cause, (b) Executive terminates this Agreement following a material breach by the Company, or (c) the death of Executive at any time during the Term, Executive (or his estate) shall be entitled to receive the Accrued Rights and, subject to Executive’s (or his estate’s) execution,  delivery and non-revocation of a  release of claims in a form to be provided by the Company within thirty  (30) following the Termination Date,: (i) payment in a lump sum of Executive’s base salary through the remainder of the Term, payable on the next regularly scheduled payroll date following the thirtieth (30th) day after the Termination Date;  and (ii) the payments and benefits set forth in Sections 1(c)(ii), (iii) and (iv) of this Agreement.  Section 6(e) of the Employment Agreement shall continue to apply during the Term and is incorporated herein by reference.
    Document
    MAGELLAN HEALTH INC
  • Description
    Upon a termination without cause by the Company or for good reason, as those terms are defined in the CFO Employment Agreement, by Mr. Eisenstadt, a severance payment equal to his base salary plus any earned incentive compensation, as well as a continuation of Aytu’s portion of COBRA payments for a period of 12 months and vesting of any issued restricted stock units; and       ● Upon a change in control, as defined in the CFO Employment Agreement, a payment equal to one times the base salary and the target annual incentive bonus compensation for the then-current year, plus 12 months of COBRA payments and accelerated vesting of all stock options or stock based awards.  
    Document
    AYTU BIOPHARMA, INC (AYTU)
  • Description
    Upon a termination of Mr. Dwivedi’s termination without cause by the Company or resignation for good reason within one year of a change in control (the “Change in Control Period”), Mr. Dwivedi will be eligible to receive (a) a lump sum severance payment in an amount of cash equal to 1.0 times annual base salary, (b) a single lump sum payment equal to 100% of his target bonus, (c) Company paid COBRA continuation coverage until the earlier of twelve months, the date that coverage is resumed under similar plans, or the date that he ceases to be eligible for coverage, and (d) full vesting of his outstanding and unvested equity awards.
    Document
    Knightscope, Inc. (KSCP)
  • Description
    •In the event of involuntary termination without cause by the Company or for “good reason” by Mr. Mitchell, continued vesting of equity awards granted on or after March 31, 2023 for two years following the date of termination of employment.
    Document
    Macy's, Inc. (M)

What is termination without cause by the company?

Termination without cause refers to the ability of a company to end the employment relationship with an employee without providing a reason related to the employee’s performance or behavior. This is different from a termination with cause, where the employee is let go due to specific reasons such as misconduct or failure to meet job expectations. Termination without cause is typically allowed under employment contracts or labor laws, provided certain conditions, such as notice periods or severance payment, are met.

When should I use termination without cause by the company?

Termination without cause is often used when the company needs to make staffing changes due to business restructuring, economic downturns, mergers, or changes in strategic direction. It allows the company flexibility in managing its workforce while maintaining legal compliance. Employers should use this type of termination carefully, ensuring compliance with all relevant laws and contractual terms, and to avoid potential legal disputes or claims of wrongful dismissal.

How do I write a termination without cause by the company?

When writing a termination without cause, it is essential to include specific elements to ensure clarity and compliance with legal standards:

  1. Opening Statement: Clearly state that the decision is to terminate the employment without cause.

    Example: “This letter serves as notice of the termination of your employment with [Company Name], effective [termination date], without cause.”

  2. Details of Severance and Benefits: Outline any severance package, continuation of benefits, or outplacement services.

    Example: “You will receive a severance package equivalent to [X] weeks of your salary, and your benefits will continue for [X] months following your termination date.”

  3. Notice Period: Mention any notice period if applicable.

    Example: “In accordance with your employment contract, you are entitled to [X] weeks’ notice.”

  4. Return of Company Property: Request the return of any company property, if necessary.

    Example: “Please return all company property, including your laptop and access cards, by [specific date].”

  5. Final Settlement and HR Contact: Describe the process for final settlement of dues and the contact information for Human Resources for any further questions.

    Example: “Please contact [HR Contact Name] for assistance regarding final payments or other queries.”

  6. Closing Statement: Conclude with a professional closing and expressions of goodwill, if appropriate.

    Example: “We wish you success in your future endeavors and thank you for your contributions to the company.”

Which contracts typically contain termination without cause by the company?

Contracts that typically include provisions for termination without cause include:

  • Employment Contracts: These often specify the terms under which an employer may terminate the employment relationship without cause, along with any notice period and severance information.

  • Executive Contracts: High-level executive contracts usually contain detailed terms for termination without cause as part of broader compensation and benefits arrangements.

  • Collective Bargaining Agreements: These agreements might include clauses relating to termination without cause, particularly concerning unionized environments.

  • Temporary or Fixed-Term Contracts: While less common, these can include clauses that allow for early termination without cause, subject to penalties or compensation.

When drafting or reviewing such contracts, it is crucial to ensure that the terms align with applicable labor laws and regulatory requirements to avoid potential disputes.

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