EXHIBIT 10.16
AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT
This Amended and Restated Change of Control Agreement (the "COC
Agreement") is effective as of June 11, 2001 (the "COC Agreement Date") by and
between __________ (the "Employee") and Sybase, Inc., a Delaware corporation
(the "Company").
RECITALS
A. The Employee presently serves at the pleasure of the Board of
Directors of the Company (the "Board") as the
___________________________________ of the Company and performs significant
strategic and management responsibilities necessary to the continued conduct of
the Company's business and operations.
B. The Employee and the Company previously entered into a Statement of
Employment Terms dated ____________________ (which was amended
___________________) setting forth the benefits to which the Employee is
entitled upon a Change of Control (as defined below) of the Company.
C. The Board has determined that it remains in the best interests of the
Company and its stockholders to assure that the Company will have the continued
dedication and objectivity of the Employee, notwithstanding the possibility,
threat or occurrence of a Change of Control of the Company.
D. The Board believes that it is imperative to provide the Employee with
benefits following a Change of Control which are competitive in the market place
and which provide sufficient incentive and encouragement to the Employee to
remain with the Company, and the Board therefore has determined that it is in
the best interests of the Company to amend and restate the terms applicable upon
a Change of Control.
E. In order to accomplish the foregoing objectives, the Board has
directed the Company, upon execution of this COC Agreement by the Employee, to
agree to the terms provided herein.
F. Certain capitalized terms used in the COC Agreement are defined in
Section 3 below.
In consideration of the mutual covenants herein contained, and in
consideration of the continuing employment of Employee by the Company, the
parties agree as follows:
1. Term of Employment. The Company and the Employee acknowledge that the
Employee's employment is at will, as defined under applicable law, except as may
otherwise be provided under the terms of any written employment agreement
between the Company and Employee that is signed on behalf of the Company and now
or hereafter is in effect. If the
Employee's employment terminates for any reason, the Employee shall not be
entitled to any payments, benefits, damages, awards or compensation other than
as provided by this COC Agreement, together with any written employment
agreement then in effect between Employee and the Company, and as may otherwise
be available in accordance with the Company's established written employee plans
and written policies which are in effect at the time of termination.
2. Change of Control Benefits.
(a) Upon the occurrence of a Change of Control, and regardless of
whether Employee has been terminated, the Employee shall be entitled to receive
a payment in an amount equal to the sum of (A) twice the Employee's annual base
salary at the time of the Change of Control, plus (B) twice the average of (x)
the annual cash bonus, if any, received or deferred by the Employee in respect
of the most recently completed fiscal year (or, if such bonus, if any, has been
earned but not yet received or deferred, the annual cash bonus, if any, to be
received or deferred with respect to such fiscal year), and (y) the annualized
annual cash bonus that Employee is then eligible to receive for the Company's
fiscal year in effect on the date of the Change of Control (which shall be
calculated by annualizing the objective performance milestones based on the
completed fiscal quarters in such fiscal year, and by assuming 100% "on target"
satisfaction of any subjective performance milestones); provided, however, that
if such Change in Control occurs prior to the completion of the first fiscal
quarter, then Employee shall instead receive a payment in the amount described
in clause (A) above plus twice the average of the annual cash bonuses, if any,
received or deferred by the employee in respect of the two most recently
completed fiscal years (or, if such bonus, if any, has been earned but not yet
received or deferred with respect to the most recently completed fiscal year,
the average of the prior fiscal year's annual cash bonus and the annual cash
bonus, if any, to be received or deferred with respect to the most recently
completed fiscal year); provided further, however, notwithstanding the above, if
the amount calculated under Clause (B) above is less than two times the
Employee's target annual incentive compensation for the Company's fiscal year in
effect at the time of the Change of Control (the "Current Year"), then the
amount under Clause (B) shall instead be deemed to be two times the Employee's
target annual compensation for the Current Year. Any payments to which the
Employee is entitled pursuant to this section shall be paid in a lump sum within
thirty (30) days of the Change of Control. In addition, if within the eighteen
(18) month period following any Change of Control the Employee's employment
terminates for any reason other than Cause, the Company shall be obligated for
the twenty -four (24) month period following the date of termination to continue
to make available to the Employee and to pay for all health, dental, vision,
life, dependent life, long-term disability, accidental death and dismemberment
and other similar insurance plans existing on the date of termination, or to
provide comparable coverage. The Company shall "gross-up" Employee for any
income required to be imputed by virtue of providing the benefits set forth in
the preceding sentence, such that the net economic result to the Employee will
be as if such benefits were provided on a tax-free basis. In addition, any
outstanding stock option or restricted stock held by the Employee under the
Company's stock option plans, under the Company's subsidiaries' stock option
plans and under the stock option plans of corporations that have merged with or
into the Company shall automatically have its vesting accelerated (including,
for restricted stock, accelerated lapse of a right of repurchase by the Company)
as to 100% of the unvested portion of such option or restricted stock on the
date of termination.
(b) Termination Apart from Change of Control. Aside from the amounts
specified above payable in the event of a Change of Control, if the Employee's
employment is terminated for any reason, then the Employee shall be entitled to
receive severance and any other benefits only as may then be established under
the Company's existing written severance and benefit plans and written policies
and under any written employment agreement in effect at the time of such
termination.
3. Definition of Terms. The following terms referred to in this COC
Agreement shall have the following meanings:
(a) Change of Control. "Change of Control" shall mean the
occurrence of any of the following events:
(i) Any "person" (as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or
more of the total voting power represented by the Company's then outstanding
voting securities, whether by tender offer, or otherwise; or
(ii) A change in the composition of the Board, as a result
of which fewer than a majority of the directors are Incumbent Directors.
"Incumbent Directors" shall mean directors who either (A) are directors of the
Company as of the COC Agreement Date, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of the
Incumbent Directors at the time of such election or nomination (but shall not
include an individual whose election or nomination is in connection with an
actual or threatened proxy contest relating to the election of directors to the
Company); or
(iii) The consummation of a merger or consolidation of the
Company 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) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the liquidation of the Company the sale or disposition by
the Company of all or substantially all of the Company's assets.
(b) Cause. "Cause" shall mean (i) any act of personal dishonesty
taken by the Employee in connection with his or her responsibilities as an
employee and intended to result in substantial personal enrichment of the
Employee, (ii) the conviction of a felony, (iii) a willful act by the Employee
which constitutes gross misconduct and which is injurious to the Company, and
(iv) continued violations by the Employee of the Employee's obligations as an
employee of the Company which are demonstrably willful and deliberate on the
Employee's part after there has been delivered to the Employee a written demand
for performance from the Company which describes the basis for the Company's
belief that the Employee has not substantially performed his or her duties.
(c) Disability. "Disability" shall mean that the Employee has
been unable to
perform his or her duties as an employee of the Company as the result of
incapacity due to physical or mental illness, and such inability, at least 26
weeks after its commencement, is determined to be total and permanent by a
physician selected by the Company or its insurers and acceptable to the Employee
or the Employee's legal representative (such agreement as to acceptability not
to be unreasonably withheld). Termination resulting from Disability may only be
effected after at least 30 days' written notice by the Company of its intention
to terminate the Employee's employment. In the event that the Employee resumes
the performance of substantially all of his of her duties as an employee of the
Company before the termination of his or her employment becomes effective, the
notice of intent to terminate shall automatically be deemed to have been
revoked.
4. Excise Tax. In the event that the severance and other benefits
provided for in this COC Agreement or otherwise payable to the Employee (i)
constitute "parachute payments" within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code") and (ii) but for this
Section 4, would be subject to the excise tax imposed by Section 4999 of the
Code (the "Excise Tax"), then the Employee shall receive (a) a payment from the
Company sufficient to pay the Excise Tax plus (b) an additional payment from the
Company sufficient to pay the Excise Tax and federal and state income and
employment taxes arising from the payments made by the Company to the Employee
pursuant to this sentence. Unless the Company and the Employee otherwise agree
in writing, the determination of the Employee's Excise Tax liability and the
amount required to be paid under this Section 4 shall be made in writing in good
faith by the accounting firm serving as the Company's independent public
accountants immediately prior to the Change of Control (the "Accountants"), in
good faith consultation with the Employee. For purposes of making the
calculations required by this Section 4, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code. The Company and the Employee shall furnish to the
Accountants such information and documents as the Accountants may reasonably
request in order to make a determination under this Section. The Company shall
bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 4.
5. Successors.
(a) Company's Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) or to all or substantially all of the Company's
business and/or assets shall assume the obligations under this COC Agreement and
agree expressly to perform the obligations under this COC Agreement in the same
manner and to the same extent as the Company would be required to perform such
obligations in the absence of a succession. For all purposes under this COC
Agreement, the term "Company" shall include any successor to the Company's
business and/or assets which executes and delivers the assumption agreement
described in this subsection (a) or which becomes bound by the terms of this COC
Agreement by operation of law.
(b) Employee's Successors. The terms of this COC Agreement and
all rights of the Employee hereunder shall inure to the benefit of, and be
enforceable by, the Employee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and
legatees.
6. Notices. Notices and all other communications contemplated by this
COC Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered or when mailed by U.S. registered or certified mail,
return receipt requested and postage prepaid. In the case of the Employee,
mailed notices shall be addressed to him or her at the home address which he or
she most recently communicated to the Company in writing. In the case of the
Company, mailed notices shall be addressed to its corporate headquarters, and
all notices shall be directed to the attention of its Secretary.
7. Miscellaneous Provisions.
(a) No Duty to Mitigate. The Employee shall not be required to
mitigate the amount of any payment contemplated by this COC Agreement (whether
by seeking new employment or in any other manner), nor shall any such payment be
reduced by any earnings that the Employee may receive from any other source.
(b) Waiver. No provision of this COC Agreement shall be modified,
waived or discharged unless the modification, waiver or discharge is agreed to
in writing and signed by the Employee and by an authorized officer of the
Company (other than the Employee). No waiver by either party of any breach of,
or of compliance with, any condition or provision of this COC Agreement by the
other party shall be considered a waiver of any other condition or provision or
of the same condition or provision at another time.
(c) Entire Agreement. Except with respect to the terms of any
written employment agreement, if any, by and between the Company and Employee
that is signed on behalf of the Company, no agreements, representations or
understandings (whether oral or written and whether express or implied) which
are not expressly set forth in this COC Agreement have been made or entered into
by either party with respect to the subject matter hereof. This COC Agreement
supercedes in its entirety the ______, 19__ Statement of Employment Terms
between the parties and the Amendment thereto dated _______________.
(d) Choice of Law. The validity, interpretation, construction and
performance of this COC Agreement shall be governed by the laws of the State of
California.
(e) Severability. The invalidity or unenforceability of any
provision or provisions of this COC Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.
(f) Arbitration. Any dispute or controversy arising under or in
connection with this COC Agreement shall be settled exclusively by arbitration
in the County of Contra Costa, California, in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction. Punitive damages shall not
be awarded.
(g) No Assignment of Benefits. The rights of any person to
payments or benefits under this COC Agreement shall not be made subject to
option or assignment, either by voluntary or involuntary assignment or by
operation of law, including (without limitation) bankruptcy, garnishment,
attachment or other creditor's process, and any action in violation of this
subsection (g) shall be void.
(h) Employment Taxes. Subject to Section 4, all payments made
pursuant to this COC Agreement will be subject to withholding of applicable
income and employment taxes.
(i) Assignment by Company. The Company may assign its rights
under this COC Agreement to an affiliate, and an affiliate may assign its rights
under this COC Agreement to another affiliate of the Company or to the Company;
provided, however, that no assignment shall be made if the net worth of the
assignee is less than the net worth of the Company at the time of assignment. In
the case of any such assignment, the term "Company" when used in a section of
this COC Agreement shall mean the corporation that actually employs the
Employee.
(j) Counterparts. This COC Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.
IN WITNESS WHEREOF, each of the parties has executed this COC
Agreement, in the case of the Company by its duly authorized officer, as of the
COC Agreement Date.
SYBASE, INC.
By
- -------------------------------- --------------------------------
Employee Daniel R. Carl
Vice President, General Counsel and
Secretary