Exhibit 10bb.
AMENDED AND RESTATED
CHANGE-IN-CONTROL AGREEMENT
December ,
2008
PERSONAL AND
CONFIDENTIAL
«First_Name»
«Last_Name»
«Job_Title»
«Company»
«Address»
Dear
«First_Name»:
Bristol-Myers Squibb Company (the
“Company”) considers it essential to the best interests
of its stockholders to foster the continued employment of key
management personnel. Our Board of Directors (the
“Board”) recognizes that the possibility of a change in
ownership or control of the Company may result in the departure or
distraction of key personnel to the detriment of the Company and
our stockholders. Therefore, the Board has determined to enter into
this agreement with you (i) to encourage and reinforce your
attention and dedication to your assigned duties without
distraction in the face of the disruptive circumstances that can
arise from a possible change in control of the Company,
(ii) to enhance our ability to retain you in those
circumstances, and (iii) to provide you with fair and
reasonable protection from the risks of a change in ownership and
control so that you will be in a position to help the Company
complete a transaction that would be beneficial to stockholders.
Accordingly, you and the Company have entered into a
Change-in-Control Agreement effective for the period from
January 1, 2008 through December 31, 2008 (the
“Prior CiC Agreement”). For purposes of complying with
Section 409A of the Internal Revenue Code, we have amended the
Prior CiC Agreement as permitted under Section 8(f) of the
Prior CiC Agreement. The Amended and Restated Change-in-Control
Agreement is as follows:
1. Term of Agreement and
Protected Period .
(a) Term of Agreement . This
Agreement shall be effective as of January 1, 2009 and shall
continue in effect through December 31, 2009, and commencing
on January 1, 2010, and each January 1 thereafter, this
Agreement shall be automatically extended for one additional year
unless, not later than December 1 of the year preceding the
renewal date, either party to this Agreement has given notice to
the other that the Agreement shall not be extended under this
Section 1(a); provided, however , that if a Change in
Control or Potential Change in Control (as defined below) have
occurred during the term of this Agreement, this Agreement shall
continue in effect until the later of 36 months beyond the month in
which the latest Change in Control occurred or the next
December 31 that is at least 18 months after the latest
occurrence of a Potential Change in Control. The foregoing
notwithstanding, this Agreement shall terminate upon your attaining
your Retirement Date.
(b) Protected Period . The
“Protected Period” is the period from the time of
occurrence of a Change in Control until the end of the 36th month
after the Change in Control, except that the introductory text to
Section 4 provides that certain events occurring before a
Change in Control shall be deemed to have occurred during the
Protected Period.
2. Change in Control and
Potential Change in Control .
(a) A “Change in
Control” shall be deemed to have occurred if, during the term
of this Agreement, on the earliest to occur of the following
dates:
(i) The date any Person (as defined
in Section 13(d)(3) of the Securities and Exchange Act) shall
have become the direct or indirect beneficial owner of thirty
percent (30%) or more of the then outstanding common shares of
the Company;
(ii) The date of consummation of a
merger or consolidation of the Company with any other corporation
other than (i) a merger or consolidation which would result in
the voting securities of the company outstanding immediately prior
thereto continuing to represent at least
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fifty one percent (51%) of the
combined voting power of the voting securities of the Company or
the surviving entity outstanding immediately after such merger or
consolidation, or (ii) a merger or consolidation effected to
implement a recapitalization of the Company in which no Person
acquires more than fifty percent (50%) of the combined voting
power of the Company’s then outstanding
securities;
(iii) The date the stockholders of
the Company approve a plan of complete liquidation of the Company
or an agreement for the sale or disposition by the Company of all
or substantially all the Company’s assets;
(iv) The date there shall have been
a change in the composition of the Board of Directors of the
Company within a two (2) year period such that a majority of
the Board does not consist of directors who were serving at the
beginning of such period together with directors whose initial
nomination for election by the Company’s stockholders or, if
earlier, initial appointment to the Board was approved by the vote
of two-thirds of the directors then still in office who were in
office at the beginning of the two (2) year period together
with the directors who were previously so approved.
The foregoing notwithstanding, a
Change in Control shall not include any event, circumstance or
transaction resulting from the actions of any entity or group which
is affiliated with you, unless the event, circumstance or
transaction is within six months following a Potential Change in
Control which resulted from the action of an entity or group not
affiliated with you. The term “Person” has the meaning
given in Section 3(a)(9) of the Exchange Act, as modified and
used in Sections 13(d) and 14(d) thereof; however, a Person shall
not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its subsidiaries,
(iii) an underwriter temporarily holding securities pursuant
to an offering of such securities, or (iv) a corporation
owned, directly or indirectly, by the stockholders of the Company
in substantially the same proportions as their ownership of stock
of the Company.
(b) A “Potential Change in
Control” shall be deemed to have occurred if, during the term
of this Agreement:
(i) The Company enters into a
written agreement, the consummation of which would result in a
Change in Control; or
(ii) The Company or any Person
publicly announces an intention to take or to consider taking
actions which, if consummated, would constitute a Change in
Control; or
(iii) Any Person who is or becomes
the Beneficial Owner, directly or indirectly, of securities of the
Company representing 10% or more of the combined voting power of
the Company’s then outstanding securities (except, if the
Beneficial Owner is an institutional investor eligible to file a
Schedule 13G in respect of the Company under Rule 13d-1(b), this
threshold shall be 15%), thereafter increases such Person’s
beneficial ownership of such securities by 5% or more;
or
(iv) The Board adopts a resolution
to the effect that, for purposes of this Agreement, a Potential
Change in Control has occurred.
3. Employee Covenants
.
You agree that, subject to the terms
and conditions of this Agreement, in the event of a Potential
Change in Control, you will remain in the employ of the Company or
a subsidiary until the date that is six months after the earliest
Potential Change in Control, except your commitment will end upon
(i) the occurrence of a Change in Control, (ii) your
Termination by reason of death , (iii) your Termination by the
Company for any reason, or (iv) any other Termination under
which you become entitled to severance and benefits under
Section 4(b) of this Agreement. A “Termination”
means your “separation from service” from the Company
and all subsidiaries within the meaning of Treasury Regulation
§ 1.409A-1(h).
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4. Termination and Resulting
Compensation and Benefits . The Agreement provides no
compensation or benefits in connection with Terminations which
occur at times other than during the Protected Period, except that,
if you are Terminated prior to a Change in Control by the Company
without Cause at the direction of a Person who has entered into an
agreement with the Company the consummation of which will
constitute a Change in Control, or if you Terminate with Good
Reason prior to a Change in Control (determined by treating a
Potential Change in Control as a Change in Control in applying the
definition of Good Reason) if the circumstance or event which
constitutes Good Reason occurs at the direction of such Person, and
if in each case the Change in Control occurs within one year after
your Termination, then your Termination shall be deemed to have
been during the Protected Period and following a Change in Control
and shall qualify for the compensation and benefits specified in
Section 4(b).
(a) Termination by the Company
for Cause, by You Without Good Reason, or by Reason of Death, and
Failure to Perform Duties Due to Disability . If during the
Protected Period you are Terminated by the Company for Cause, you
voluntarily Terminate without Good Reason, Termination occurs due
to your death, or you fail to perform your duties with the Company
as a result of Disability, the Company will have no obligation to
pay any compensation or benefits to you under this Agreement, but
the following obligations will apply:
(i) In the case of failure to
perform your duties due to Disability, you will be compensated on
terms at least as favorable as those of the Company’s
short-term and long-term disability plans as in effect immediately
prior to the Change in Control.
(ii) For any such Termination, you
will be paid your salary through the Date of Termination plus all
other compensation and benefits payable through the Date of
Termination under the terms of any compensation or benefit plan,
program or arrangement maintained by the Company during such
period, subject to Section 5. If any annual incentive
compensation was potentially earnable by you by performance in a
year that has been completed, and such year was completed at the
date of the Termination but the annual incentive compensation was
not yet determined or not yet paid, the Company will determine the
amount payable in good faith and with no exercise of negative
discretion except as is consistent with the exercise of such
negative discretion for other executives of the Company who have
not Terminated (taking into account practice in prior years in
determining such annual incentive awards); provided, however, that
this sentence will not apply in the case of a Termination by the
Company for Cause.
(iii) You will receive other
compensation and benefits accrued and owing but not yet paid at the
Date of Termination and any compensation and benefits as may be
provided under the Company’s retirement, insurance and other
compensation or benefit plans, programs and arrangements on terms
at least as favorable as those in effect immediately prior to the
Change in Control.
(b) Terminations Triggering
Severance Compensation and Benefits . In lieu of any other
severance compensation or benefits to which you may otherwise be
entitled under any plan, program, policy or arrangement of the
Company or any subsidiary, entitlement to which you hereby
expressly waive, the Company will pay you the payments described in
this Section 4(b) (the “Severance Payments”) upon
Termination during the Protected Period and during the term of this
Agreement, unless such termination is (i) by the Company for
Cause, (ii) by reason of death, (iii) due to your failure
to perform your duties with the Company as a result of Disability,
or (iv) by you without Good Reason. The compensation and
benefits provided under this Section 4(b) are as
follows:
(i) The Company will pay you the
amounts specified in Section 4(a)(ii).
(ii) In lieu of any further salary
payments to you and in lieu of any severance benefit otherwise
payable to you, the Company will pay you, in the form specified in
Section 5 (a lump sum to the extent permissible), a severance
payment, in cash, equal to 2.99 or, if less, the number of years,
including fractions, from your Date of Termination until you reach
your Retirement Date, times the sum of (i) the higher of your
annual base salary in effect immediately prior to the occurrence of
the event or circumstance upon which the Notice of
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Termination is based or your annual
base salary in effect immediately prior to the Change in Control,
and (ii) the aggregate amount of your target annual bonus
opportunity for the year in which the Notice of Termination was
given under the annual incentive plan applicable to you as in
effect immediately prior to the occurrence of the event or
circumstances giving rise to the Notice of Termination or, if
greater, your target annual bonus under the applicable plan for the
preceding year.
(iii) The Company will pay to you,
in the form specified in Section 5 (a lump sum to the extent
permissible), an amount, in cash, equal to the sum of (A) any
incentive compensation which has been earned, allocated or awarded
by you or to you for a completed calendar year or other measuring
period preceding the Date of Termination but has not yet been paid
(this shall not result, however, in duplication of payments under
Section 4(b)(i) and 4(a)(ii)), with any further service
requirement for the vesting of such compensation deemed met as of
the Date of Termination, and (B), in the case of any annual
incentive award contingent upon performance (i.e., a contingency
other than continued service), equal to the pro rata portion of
each authorized award or award opportunity for any performance
measurement period that was in effect at the Date of Termination,
calculated as to each such award assuming that any performance goal
or measurement will have been achieved (for the entire performance
period) at the level of the actual results achieved, if available,
or if not at the target level; provided, however, any additional
forfeiture conditions in the nature of a “clawback”
contained in any plan or award agreement shall continue to apply to
any payment under clause (A) or (B), and shall be deemed your
covenants to be performed following termination. For purposes of
clause (B), the pro rata portion shall be determined based on the
proportion of the performance period elapsed from the beginning of
such period until the Date of Termination, and any service, vesting
or other non-performance requirement relating to such an award,
including a service period that would have extended after the
performance period, will be deemed met; provided, however, that the
payment authorized by Section 4(b)(iii)(B) will be limited if
the terms of any award or other agreement specifically limit the
payment under this agreement (referring clearly to this agreement
or a predecessor change in control agreement).
(iv) In the case of restricted
stock, restricted stock units, options, stock appreciation rights
(“SARs”) and other equity awards, other than
performance-based awards governed by Section 4(b)(iii) above,
such awards shall be deemed fully vested and non-forfeitable (to
the extent not previously vested and non-forfeitable) and
restrictions on such awards shall automatically lapse as of the
Date of Termination (subject to Section 5), and options and
SARs and other exercisable awards will be immediately exercisable
in full at that date; provided, however, that (A) the enhanced
rights and benefits specified in this Section 4(b)(iv) will be
limited if and to the extent that the terms of any award or other
agreement specifically limit such enhanced rights and benefits
under this agreement (referring clearly to this agreement or a
predecessor change-in-control agreement), (B), if minimum vesting
requirements applicable to any award under the 2007 or 2002 Stock
Incentive Plan or other Company plan do not permit such accelerated
vesting, the Company will make a cash payment to you equal to the
fair market value (net of any exercise price) of such award at the
Date of Termination, whereupon such award will be canceled;
(C) any additional forfeiture conditions in the nature of a
“clawback” contained in any plan or award agreement
shall continue to apply, and shall apply to any payment under
clause (B), and shall be deemed your covenants to be performed
following termination; and (D) the acceleration of options and
SARs and other awards provided for hereunder is subject to the
limitations specified in Section 4(c).
(v) In addition to the retirement
benefits to which you are entitled under the Bristol-Myers Squibb
Company Retirement Income Plan (the “Retirement Plan”)
and the Bristol-Myers Squibb Company Benefit Equalization Plan
relating to the Retirement Plan (the “BEP”), or any
successor plans thereto, the Company will pay you an additional
amount (the “Additional Amount”) equal to the excess
of
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(x)
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the actuarial equivalent present
value of the retirement pension (determined as a straight life
annuity commencing at your Retirement Date) which you would have
accrued under the
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terms of the Retirement Plan and
BEP (without regard to any amendment to the Retirement Plan or BEP
made subsequent to a Change in Control which is adverse to you),
determined as if you (A) were fully vested thereunder, and
(B) had accumulated (after the Date of Termination) 36
additional months of age and service credit thereunder at your
highest annual rate of compensation (as such term is defined under
the BEP) during the 12 months immediately preceding the Date of
Termination (but in no event will you be deemed to have accumulated
additional service credit in excess of the maximums taken into
account under the Retirement Plan and BEP) (the “Additional
Age/Service Credit”)
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over
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(y)
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the
actuarial equivalent present value of the vested retirement pension
(determined as a straight life annuity commencing at your
Retirement Date) which you had then accrued pursuant to the
respective provisions of the Retirement Plan and BEP (the BEP
portion of such retirement pension being the “Base BEP
Benefit”).
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The Additional Amount will be paid,
in the form specified in Section 5 (a lump sum to the extent
permissible), as a cash amount following your Termination in
accordance with Section 5 hereof. If you have not attained age
55 with ten years of service credit as of the Date of Termination
(after taking into account the Additional Age/Service Credit), you
will receive the payments under this Section 4(b)(v) as though
you had attained age 55 with ten years of service credit as of the
Date of Termination, and without actuarial reduction to reflect the
fact that you have not attained age 55 with ten years of service as
of the Date of Termination. For purposes of this
Section 4(b)(v), “actuarial equivalent” will be
determined using the same methods and assumptions utilized under
the Retirement Plan immediately prior to the Date of
Termination.
(vi) For a 36-month period after the
Date of Termination (subject to Section 5), the Company will
arrange to provide you with life and health (including medical and
dental) insurance benefits substantially similar to those which you
are receiving immediately prior to the Notice of Termination
(without giving effect to any reduction in such benefits subsequent
to a Change in Control). Benefits otherwise receivable by you
pursuant to this Section 4(b)(vi) will be reduced to the
extent comparable benefits are actually received by or made
available to you without greater cost to you than as provided by
the Company during the 36-month period following your termination
of employment (and any such benefits actually received by you will
be reported to the Company by you).
(vii) Following the 36-month period
described in Section 4(b)(vi), you will be immediately
eligible to participate (although you may elect to defer
commencement of such participation to such later date as you will
determine) in the Company’s retiree medical plans, whether or
not you have satisfied any age and service requirements then
applicable. For purposes of determining the level of your
participation thereunder, you will be deemed to have accumulated 36
months of additional age and service credit; it being understood
that if your age and service credit (as augmented hereunder) do not
satisfy the minimum requirements for eligibility, you will be
eligible to participate at the level requiring the maximum
contribution requirement by an eligible retiree. Notwithstanding
the foregoing, in the event that the forgoing retiree benefits fail
to comply with the requirements of Section 409A of the Code,
then in lieu of receiving such benefits, you will be entitled to
receive cash payments from the Company that will equal the
Company’s cost of providing those benefits to you. Your first
payment in lieu of those retiree benefits will be made in the first
month following cessation of the coverage or payments in lieu of
coverage as provided under Section 4(b)(vi) hereof.
(viii) In addition to the vested
amounts, if any, to which you are entitled under the
Company’s Savings and Investment Program, including the
Company’s Benefit Equalization Plan for the Savings and
Investment Program, as of the Date of Termination, the Company will
pay you a lump sum amount (subject to Section 5) equal to the
value of the unvested portion, if any, of the employer matching
contributions credited to you under the Company’s Savings and
Investment Program, including the Company’s Benefit
Equalization Plan for the Savings and Investment Program (to the
extent such unvested portion is forfeited as a result of your
Termination).
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(ix) The Company will provide you
with (including reimbursements to you for) reasonable outplacement
services consistent with past practices of the Company prior to the
Change in Control.
(c) Excise Tax, Gross-Up and
Related Provisions . In the event you become entitled to any
amounts payable in connection with a Change in Control (whether or
not such amounts are payable pursuant to this Agreement) (the
“CiC Payments”), if any of such CiC Payments are
subject to the tax (the “Excise Tax”) imposed by
Section 4999 of the Code (or any similar federal, state or
local tax that may hereafter be imposed), the Company shall pay to
you at the time specified in Section 5 hereof an additional
amount (the “Gross-Up Payment”) such that the net
amount retained by you, after deduction of any Excise Tax on the
Total Payments (as hereinafter defined) and any federal, state and
local income tax (taking into account the loss of itemized
deductions) and employment tax and Excise Tax upon the payment
provided for by this Section 4(c), shall be equal to present
value of the Total Payments. If any portion of the Total Payments
would be subject to the imposition of the Excise Tax, and if a
reduction of any compensation or benefit under Section 4(b) by
an amount not exceeding 10% of the Safe Harbor Amount would avoid
the imposition of the Excise Tax on you, payments and benefits
payable pursuant to Section 4(b) of this Agreement shall be
reduced to the extent necessary (but not more than 10% of the Safe
Harbor Amount and only to the extent necessary) to result in no
imposition of the Excise Tax on you. This cut-back provision shall
apply to amounts and benefits payable hereunder which are
designated in writing by you prior to the applicable payment date
or, if no designation has been made, to payments and benefits
hereunder as determined by the Company so as to minimize the amount
of your compensation that is reduced (i.e., the payments that to
the greatest extent are parachute payments shall be reduced to the
extent authorized hereunder). “Safe Harbor Amount”
shall mean one dollar less than 300% of the “base
amount” as determined in accordance with
Section 280G(b)(3) of the Code.
For purposes of determining whether
any of the CiC Payments will be subject to the Excise Tax and the
amount of such Excise Tax:
(i) The Severance Payments and any
other payments or benefits received or to be received by you in
connection with a Change in Control or your termination of
employment (whether pursuant to the terms of this Agreement or any
other plan, arrangement or agreement with the Company, any Person
whose actions result in a Change in Control or any Person
affiliated with the Company or such Person) (which together
constitute the “Total Payments”) shall be treated as
“parachute payments” within the meaning of
Section 280G(b)(2) of the Code, and all “excess
parachute payments” within the meaning of
Section 280G(b)(1) of the Code shall be treated as subject to
the Excise Tax, unless in the opinion of nationally-recognized tax
counsel selected by the Company’s independent auditors and
reasonably acceptable to you (the “Tax Counsel”), such
payments or benefits (in whole or in part) do not constitute
parachute payments, or such excess parachute payments (in whole or
in part) represent reasonable compensation for services actually
rendered within the meaning of Section 280G(b)(4) of the Code
in excess of the base amount within the meaning of
Section 280G(b)(3) of the Code, or are otherwise not subject
to the Excise Tax;
(ii) The amount of the Total
Payments which shall be treated as subject to the Excise Tax shall
be equal to the lesser of (A) the total amount of the Total
Payments and (B) the amount of excess parachute payments
within the meaning of Section 280G(b)(1) of the Code (after
applying Section&
