Termination Upon Disability


The Termination Upon Disability clause generally operates either automatically or at the discretion of the employer. Disability is usually defined as some period, either cumulative or continuous (or both), of physical or mental disability that materially impacts the duties of the Executive. The termination may or may not include an advance written notice and a period to remedy the disability.

Clause examples use similar language, but differ significantly in the amount of time defining disability. Also, when clause examples explicitly addressed compensation, they differed widely. Some examples provide severance upon a termination due to disabilities where others provide no additional compensation and require the Executive to reimburse the Company for any disability payments.

Standard Clause

Termination Upon Disability. This Agreement shall terminate automatically upon the Disability of the Executive.

Disability. Disability means the Executive is unable to perform the duties set forth in this Agreement for a period of [twelve consecutive weeks], or [90] cumulative business days in [any 12-month] period, as a result of physical or mental illness or loss of legal capacity.

Clause Alternatives

Alternative 1 - Automatic Termination

Termination Upon Disability. This Agreement shall terminate automatically upon the Disability of the Executive.

Alternative 2 - Optional Termination

Termination Upon Disability. The Company may terminate this agreement upon the Disability of the Executive.

Alternative 3 - Merged Termination and Definition

Disability. If, as a result of Executive's incapacity due to physical or mental illness, Executive shall have been absent from his duties hereunder on a full-time basis for one hundred eighty (180) calendar days in the aggregate in any twelve (12) month period, the Company may terminate Executive's employment.

Examples from EDGAR

Termination on Account of Death or Disability; Non-Qualifying Termination.
(i) In the event of any termination of Executive's employment other than a Qualifying Termination (for example, on account of death or Disability), the Executive shall not be entitled to any additional payments or benefits from the Company under this Agreement, other than payments or benefits with respect to the Accrued Rights.
(ii) For purposes of this Agreement, the Executive shall be deemed to have a "Disability" in the event of the Executive's absence for a period of 180 consecutive business days as a result of incapacity due to a physical or mental condition, illness or injury that is determined to be total and permanent by a physician mutually acceptable to the Company and the Executive or the Executive's legal representative (such acceptance not to be unreasonably withheld) after such physician has completed an examination of the Executive. The Executive agrees to make himself available for such examination upon the reasonable request of the Company, and the Company shall be responsible for the cost of such examination.
Amended and Restated Employment Agreement, August 17, 2011, [First Solar Inc.]

Termination for Disability. The Company may terminate the Executive's employment because of the Disability of the Executive and thereafter the Company shall pay to the Executive (or his successors) his unpaid Salary through the Employment Termination Date and any Stock Options which have not vested as of the Employment Termination Date shall be terminated.

"Disability" of the Executive means that, as a result of the Executive's incapacity due to physical or mental illness, the Executive shall have been absent from his duties on a full time basis for thirty (30) days in any three (3) month period. If the Executive is prevented from performing his duties because of Disability, upon request by the Company, the Executive shall submit to an examination by a physician selected by the Company, at the Company's expense, and the Executive shall also authorize his personal physician to disclose to the selected physician all of the Executive's medical records.

Executive Employment Agreement, August 16, 2011, [Arcis Resources Corp]