Exhibit 10.4
CHANGE IN CONTROL AGREEMENT
This agreement by and between Art
Technology Group, Inc., a Delaware corporation (the
“Company”) and [insert name] (the
“Executive”) is made as of April 14, 2008 (the
“Effective Date”).
WHEREAS, the Company recognizes that,
as is the case with many publicly-held corporations, the
possibility of a change in control of the Company exists and that
such possibility, and the uncertainty and questions which it may
raise among key personnel, may result in the departure or
distraction of key personnel to the detriment of the Company and
its stockholders;
WHEREAS, the Board of Directors of
the Company (the “Board”) has determined that
appropriate steps should be taken to reinforce and encourage the
continued employment and dedication of the Company’s key
personnel without distraction from the possibility of a change in
control of the Company and related events and circumstances;
and
WHEREAS, the Executive remains
employed by the Company on the first date on which a Change in
Control occurs.
NOW THEREFORE, in consideration of
the Executive remaining in the Company’s employ and other
good consideration, the receipt and sufficiency of which is
acknowledged by both parties, the Company and the Executive agree
as follows:
1. Key Definitions.
As used
herein, the following terms shall have the following respective
meanings:
“Accrued Obligations”
means, with respect to an Executive, the sum of (a) such
Executive’s base salary earned through the date of
termination of such Executive’s employment by the Company,
(b) the amount of any bonus that relates to a period completed
prior to such termination date and that was fully earned by such
Executive as of such termination date and (c) the amount of
any compensation previously earned but deferred by such Executive
(together with any accrued interest or earnings thereon) and any
accrued but unused vacation pay, in each case to the extent not
previously paid.
“Cause” means:
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a) |
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an Executive’s willful and continued failure to
substantially perform his or her reasonable assigned duties as an
employee of the Company (other than any such failures resulting
from incapacity due to physical or mental illness); or |
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b) |
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an Executive’s willful engagement in illegal conduct or
gross misconduct that is materially injurious to the Company. For
purposes of this definition, no act or |
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failure to act by an Executive shall be considered
“willful” unless it is done, or omitted to be done, in
bad faith and without reasonable belief that such Executive’s
action or omission was in the best interests of the Company. |
“Change in Control” means
an event or occurrence set forth in any one or more of subsections
(a) through (d) below (including an event or occurrence
that constitutes a Change in Control under one of such subsections
but is specifically exempted from another such subsection):
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a) |
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the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended) (a “Person”) of
beneficial ownership of any capital stock of the Company if, after
such acquisition, such Person beneficially owns (within the meaning
of Rule 13d-3 promulgated under such Act) fifty percent (50%)
or more of either (1) the then-outstanding shares of Common
Stock (the “Outstanding Common Stock”) or (ii) the
combined voting power of the then-outstanding securities of the
Company entitled to vote generally in the election of directors
(the “Outstanding Voting Securities”); provided,
however, that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change in Control: |
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(i) |
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any acquisition directly from the Company (excluding an
acquisition pursuant to the exercise, conversion or exchange of any
security exercisable for, convertible into or exchangeable for
Common Stock or voting securities of the Company, unless the Person
exercising, converting or exchanging such security acquired such
security directly from the Company or an underwriter or agent of
the Company), |
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(ii) |
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any acquisition by the Company, |
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(iii) |
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any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation
controlled by the Company, or |
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(iv) |
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any acquisition by any corporation pursuant to a transaction
that complies with clauses (i) and (ii) of subsection (c)
below; |
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b) |
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the occurrence of a change in the composition of the Board such
that the Continuing Directors do not constitute a majority of the
Board (or, if applicable, the Board of Directors of a successor
corporation to the Company), where the term “Continuing
Director” means at any date a member of the Board: |
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(i) |
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who was a member of the Board on the effective date of this
Agreement or |
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(ii) |
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who was nominated or elected subsequent to such date by at
least a majority of the directors who were Continuing Directors at
the time of such nomination or election or whose election to the
Board was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such
nomination or election; provided, |
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however, that there shall be excluded from this clause
(ii) any individual whose initial assumption of office
occurred as a result of an actual or threatened election contest
with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents, by or on
behalf of a person other than the Board; |
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c) |
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the consummation of a merger, consolidation, reorganization,
recapitalization or statutory share exchange involving the Company
or a sale or other disposition of all or substantially all of the
assets of the Company in one or a series of transactions (a
“Business Combination”), unless, immediately following
such Business Combination, each of the following two conditions is
satisfied: |
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(i) |
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all or substantially all of the individuals and entities who
were the beneficial owners of the Outstanding Common Stock and
Outstanding Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than
fifty percent (50%) of the then-outstanding shares of common stock
and the combined voting power of the then-outstanding securities
entitled to vote generally in the election of directors,
respectively, of the resulting or acquiring corporation in such
Business Combination (which shall include a corporation that as a
result of such transaction owns the Company or substantially all of
the Company’s assets either directly or through one or more
subsidiaries) (such resulting or acquiring corporation is referred
to herein as the “Acquiring Corporation”) in
substantially the same proportions as their ownership, immediately
prior to such Business Combination, of the Outstanding Common Stock
and Outstanding Voting Securities, respectively, and |
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(ii) |
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no Person (excluding the Acquiring Corporation or any employee
benefit plan (or related trust) maintained or sponsored by the
Company or by the Acquiring Corporation) beneficially owns,
directly or indirectly, thirty percent (30%) or more of the then
outstanding shares of common stock of the Acquiring Corporation, or
of the combined voting power of the then-outstanding securities of
such corporation entitled to vote generally in the election of
directors (except to the extent that such ownership existed prior
to the Business Combination); or |
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d) |
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approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company. |
“Change in Control Date”
means the first date on which a Change in Control occurs. Anything
in this Agreement to the contrary notwithstanding, if (a) a
Change in Control occurs, (b) an Executive’s employment
with the Company is terminated prior to the date on which the
Change of Control occurs, and (c) it is reasonably
demonstrated by such Executive that such termination of employment
(i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change in Control or
(ii) otherwise arose in connection with or in anticipation of
a Change of Control, then for all purposes of this Agreement the
“Change in
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Control
Date” shall mean, with respect to such Executive, the day
immediately preceding such termination date.
“Common Stock” means the
common stock, $0.01 par value per share, of the Company.
“General Release” means a
release of any and all claims against the Company and related
persons and entities in a form identical to or substantially the
same as the release attached as Appendix A hereto,
provided, however, that the Company reserves the right to change
any provision concerning the notice and revocation to conform to
legal requirements.
“Good Reason” means the
occurrence, without the Executive’s written consent, of any
of the following: (a) a material reduction in the
Executive’s base salary or target bonus, (b) the
relocation of the Executive’s principal place of work to a
location more than fifty (50) miles from the location
immediately prior to the Change in Control or (c) a material
dimunition in the Executive’s responsibilities. The
Executi
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