Exhibit 10.1
CHANGE OF CONTROL AGREEMENT
This Change of Control Agreement
(this “Agreement”) is made and effective as of the last
date signified on the signature page hereto, by and between
Affiliated Computer Services, Inc. (the “Company”) and
,
(the “Executive ” ). This Agreement
replaces and supersedes that certain severance agreement by and
between the Company and the Executive, dated as of
, as the same may have been amended from time to time.
The Company has determined that both
the Executive’s performance and the Company’s ability
to retain the Executive as an employee will be significantly
enhanced if the Executive is provided with fair and reasonable
protection from a Change of Control of the Company. Accordingly,
the Company and the Executive agree as follows:
1. Defined Terms .
Unless otherwise indicated, capitalized terms used in this
Agreement shall have the meanings set forth herein or in
Schedule A .
2. Effective Date; Term
. This Agreement shall be effective on the effective date hereof
and shall remain in effect until (a) the Company terminates
this Agreement by giving the Executive at least one (1) year
advance written notice of termination or (b) the effective
date of any termination of the Executive’s employment with
the Company, whether voluntary, involuntary, or for Cause, and
regardless of the reason for such termination. Notwithstanding the
foregoing, this Agreement shall, if in effect on the date of a
Change of Control, remain in effect for such time following a
Change of Control as may be necessary to give effect to the terms
of the Agreement.
3. Change of Control
Benefits . Upon a Change of Control, the Executive shall be
entitled to the benefits provided herein.
(a) Change of Control Payments
. Within two (2) business days after a Change of Control, the
Company shall pay the Executive a lump sum amount, in cash, equal
to:
(i) three (3) times the sum
of:
(A) the Executive’s per annum
base salary in effect on the date of the Change of Control
(“Base Salary”), and
(B) the Executive’s bonus for
the immediately preceding fiscal year; and
(ii) the Executive’s target
bonus for the current fiscal year multiplied by a fraction, the
numerator of which shall be the number of days the Executive was
employed by the Company in the fiscal year in which the Change of
Control occurs and the denominator of which shall be 365.
(b) Continued Benefits . Until
the earlier of the third anniversary of the termination of the
Executive’s employment with the Company after a Change of
Control or the date on which the Executive becomes employed by a
new employer, the Company shall, at its expense, provide the
Executive with medical, dental, life insurance, disability and
accidental death and dismemberment benefits (“Insurance
Benefits”) at the highest level provided to the Executive
immediately prior to the Change of Control, provided ,
however , that if the Executive becomes employed by a new
employer which maintains Insurance Benefits that either (i) do
not cover the Executive with respect to a pre-existing condition
which was covered under the Company’s Insurance Benefits, or
(ii) do not cover the Executive for a designated waiting
period, the Executive’s coverage under the Company’s
Insurance Benefits shall continue, without limitation, until the
earlier of the end of the applicable period of noncoverage under
the new employer’s Insurance Benefits or the third
anniversary of the Change of Control.
(c) Payment of Accrued But Unpaid
Amounts . Within two (2) business days after a Change of
Control or such other timeframe as required under applicable law,
rule or regulation, the Company shall pay the Executive
(i) any unpaid portion of compensation previously earned by
the Executive; and (ii) all compensation previously deferred
by the Executive but not yet paid.
(d) Post-Retirement Welfare
Benefits . For purposes of determining the Executive’s
eligibility for post-retirement benefits under any welfare benefit
plan (as defined in Section 3(1) of the Employee Retirement
Income Security Act of 1974, as amended) maintained by the Company
immediately prior to the Change of Control and in which the
Executive then participated, the Executive shall be credited with
the excess of three (3) years of participation in the applicable
plan and three (3) years of age over the actual years of
participation and age credited to the Executive on the date of the
Change of Control. If, after taking into account the credited
participation and age, the Executive would have been eligible for
post-retirement benefits, the Executive shall receive, commencing
on the date of the Change of Control, post-retirement benefits
based on the terms and conditions of the applicable plans in effect
immediately prior to the Change of Control.
(e) Effect on Existing Plans .
All Change of Control provisions applicable to the Executive and
contained in any plan, program, agreement or arrangement maintained
on or after the date hereof by the Company (including, but not
limited to, any stock option, restricted stock or pension plan)
shall remain in effect for such period after the date of a Change
of Control as is necessary to carry out such provisions and provide
the benefits payable thereunder, and may not be altered in a manner
which adversely affects the Executive without the Executive’s
prior written approval.
(f) Outplacement Counseling .
The Company shall reimburse all reasonable expenses incurred by the
Executive for professional outplacement services by qualified
consultants selected by the Executive for a period of
12 months following a Change of Control.
4. Mitigation . The
Executive shall not be required to seek other employment after a
Change of Control and any compensation earned from other employment
shall not reduce the amounts otherwise payable under this
Agreement.
5. Gross-up .
(a) In the event it shall be
determined that any payment, benefit or distribution (or
combination thereof) by the Company, or any trust established by
the Company for the benefit of its employees, to or for the benefit
of the Executive (whether payable pursuant to the terms of this
Agreement (a “Payment”)) would be subject to the excise
tax imposed by Section 4999 of the Internal Revenue Code and any
interest or penalties are incurred by the Executive with respect to
such excise tax (the excise tax, together with interest and
penalties thereon, hereinafter collectively referred to as the
“Excise Tax”), the Executive shall be entitled to
receive an additional payment (a “Gross-up Payment”) in
an amount such that after payment by the Executive of all taxes,
including, without limitation, any income taxes and the Excise Tax
imposed upon the Gross-up Payment, the Executive retains an amount
of the Gross-up Payment equal to the Excise Tax imposed upon the
Payments.
(b) Subject to the provisions of
Section 5(c) , all determinations required to be made
under this Section 5 , including whether and when a
Gross-up Payment is required and the amount of such Gross-up
Payment and the assumptions to be utilized in arriving at such
determination, shall be made by a nationally recognized certified
public accounting firm as may be designated by the Executive (the
“Accounting Firm”). All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Gross-up
Payment, as determined pursuant to this Section 5 ,
shall be paid by the Company to the Executive within five
(5) days after the receipt of the Accounting Firm’s
determination. If the Accounting Firm determines that no Excise Tax
is payable by the Executive, it shall so indicate to the Executive
in writing. Any determination by the Accounting Firm shall be
binding upon the Company and the Executive.
(c) The Executive shall notify the
Company in writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the Company of a
Gross-up Payment. Such notification shall be given no later than
ten (10) business days after the Executive is informed in
writing of such claim and shall apprise the Company of the nature
of the claim and the date of requested payment. The Executive shall
not pay the claim prior to the expiration of the thirty
(30) day period following the date on which it gives notice to
the Company. If the Company notifies the Executive in writing prior
to the expiration of the period that it desires to contest such
claim, the Executive shall:
(i) give the Company any information
reasonably requested by the Company relating to such claim;
(ii) take such action in connection
with contesting such claim as the Company shall reasonably request
in writing from time to time, including,
without
limitation, accepting legal representation with respect to such
claim by an attorney reasonably selected by the Company;
(iii) cooperate with the Company in
good faith in order to effectively contest such claim; and
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