|
Exhibit 10.1
CHANGE OF CONTROL AGREEMENT
This Change of Control Agreement (the
"Agreement") is made and entered into as of __________ (the
"Effective Date"), by and between Sycamore Networks, Inc., a
Delaware corporation (the "Company") and
___________("Executive").
RECITALS
The Company recognizes that the
possibility of a change of control or other event which may change
the nature and structure of the Company and that uncertainty
regarding the consequences of such events may adversely affect the
Company's ability to retain its key employees. The
Company also recognizes that Executive possesses an intimate and
essential knowledge of the Company upon which the Company may need
to draw for objective advice and continued services in connection
with any acquisition of the Company or other change of control that
is potentially advantageous to the Company's
stockholders. The Company believes that the existence of
this Agreement will serve as an incentive to Executive to remain in
the employ of the Company and will enhance its ability to call on
and rely upon Executive in connection with a change of control.
The Company and Executive desire to
enter into this Agreement in order to provide additional
compensation and benefits to Executive and to encourage Executive
to continue to devote his full attention and dedication to the
Company and to continue his employment with the Company.
1. Definitions. As used in this
Agreement, unless the context requires a different meaning, the
following terms shall have the meanings set forth herein:
1.1. "Cause" means:
1.1.1. The willful engaging by Executive in illegal
conduct or gross misconduct which is materially injurious to the
Company.
No termination of Executive for Cause following a Change of Control
shall be effective unless (i) the Company has delivered a written
statement to Executive which specifically identifies the matters
alleged to constitute Cause and which provides Executive with a
reasonable opportunity to cure the existence of such Cause and (ii)
a resolution is duly adopted by the affirmative vote of not less
than two-thirds (2/3) of the entire membership of the Board of
Directors of the Acquiror (as defined below) at a meeting of the
Board which was called and held for the purpose of considering the
termination of Executive for Cause (after reasonable notice to
Executive and an opportunity for Executive, together with
Executive's counsel, to be heard before the Board) finding that, in
the good faith opinion of the Board, Executive was guilty of
conduct constituting Cause hereunder and specifying the particulars
thereof in detail.
1.2. "Change of Control" means the occurrence, as
the result of a single transaction or through a series of
transactions, of any of the following events:
1.2.1. Any Person becomes the beneficial owner, directly
or indirectly, of securities of the Company representing
thirty-five percent (35%) or more of the combined voting power of
the Company's then outstanding voting securities, excluding any
Person who becomes such a Beneficial Owner in connection with a
transaction described in Section 1.2.3(i). "Person"
shall have the meaning given in Section 3(a)(9) of the Exchange
Act, as amended, as modified and used in Sections 13(d) and 14(d)
thereof, except that such term 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; or
1.2.2. Incumbent Directors cease at any time and for any
reason to constitute a majority of the number of directors then
serving on the Board. "Incumbent Directors" shall
mean directors who either (A) are directors of the Company as of
the date hereof 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 election contest,
including but not limited to a consent solicitation, relating to
the election of directors to the Board); or
1.2.3. there is consummated a merger or consolidation of
the Company or any direct or indirect subsidiary 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 to such merger or
consolidation continuing to represent (either by remaining
outstanding or by being converted into voting securities of the
surviving entity or any parent thereof (the
“Acquiror”)) at least a majority of the combined voting
power of the securities of the Company or the Acquiror outstanding
immediately after such merger or consolidation as appropriate, or
(ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which
no Person becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing thirty-five percent (35%) or
more of the combined voting power of the Company's then outstanding
voting securities; or
1.2.4. the stockholders of the Company approve a plan of
liquidation or dissolution of the Company or there is consummated
an agreement for the sale or disposition by the Company of all or a
substantial portion of the Company's assets, other than a sale or
disposition by the Company of all or a substantial portion of the
Company's assets to an entity, at least a majority of the combined
voting power of the voting securities of which are owned by
stockholders of the Company in substantially the same
proportions as their ownership of the Company immediately
prior to such sale.
1.3. "Constructive
Termination" means the termination by Executive of Executive's
employment following the occurrence of any of the following
conditions, without Executive's written consent:
1.3.1. Any material
diminution in Executive’s position, title or
responsibilities; or
1.3.2. Any required
relocation of Executive's primary work location by more than 35
miles; or
1.3.3. Any material
diminution in Executive's annual salary or bonus potential from
that in effect immediately prior to the Change of Control.
The Executive's right to terminate Executive's employment in a
Constructive Termination shall not be affected by Executive's
incapacity due to physical or mental illness. In
addition, in order for a Constructive Termination to take place
hereunder, Executive must provide notice to the Company of the
existence of the condition or circumstance described above within
ninety (90) days of the initial existence of the condition or
circumstance (or, if later, within ninety (90) days of Executive's
becoming aware of such condition or circumstance), and the Company
must have failed to cure such condition within thirty (30) days of
the receipt of such notice. Subject to the preceding sentence,
Executive's continued employment shall not constitute consent to,
or a waiver of rights with respect to, any event entitling
Executive to initiate a Constructive Termination
hereunder. It is the intention of the parties to this
Agreement that the definition of Constructive Termination comply,
and shall be construed in a manner so as to comply, with the safe
harbor "good reason" definition set forth in Treasury Regulation
1.409A-1(n)2(ii).
1.4. "Termination
Upon a Change of Control" means:
1.4.1. Any
termination of the employment of Executive by the Company (i)
without Cause prior to a Change of Control (whether or not such a
Change of Control ever occurs) if such termination was at the
request or direction of a person who has entered into an agreement
with the Company the consummation of which would constitute a
Change of Control, (ii) by Executive pursuant to a Constructive
Termination prior to a Change of Control (whether or not such a
Change of Control ever occurs) and the circumstance or event which
permits Constructive Termination occurs at the request or direction
of a person who has entered into an agreement with the Company the
consummation of which would constitute a Change of Control, or
(iii) Executive's employment is terminated by the Company without
Cause or by Executive pursuant to a Constructive Termination and
such termination or the circumstance or event which permits a
Constructive Termination is otherwise in connection with or in
anticipation of a Change of Control (whether or not such a Change
of Control ever occurs);
1.4.2. Any
termination of the employment of Executive by the Company without
Cause on or within the twenty four (24) month period following a
Change of Control;
1.4.3. Any
resignation by Executive due to an event constituting a
Constructive Termination, which resignation occurs on or
within the twenty four (24) month period following the date of any
Change of Control.
1.4.4. "Termination
Upon Change of Control" shall not include any termination of
Executive's employment (a) by the Company for Cause or due
to Executive's Disability; or (b) as a result of (i) the
voluntary termination of employment by Executive for a reason other
than Constructive Termination or (ii) Executive's
death. "Disability" shall be deemed the reason for the
termination by the Company of Executive's employment, if, as a
result of Executive's incapacity due to physical or mental illness,
Executive shall have been absent from the full time performance of
Executive's duties with the Company for a period of one hundred
twenty (120) days, the Company shall have given Executive a notice
of termination for Disability, and, within thirty (30) days after
such notice is given, Executive shall not have returned to the full
time performance of Executive's duties.
2. Position
and Duties. Executive shall continue to be an at-will
employee of the Company employed in his/her current position at
his/her then current salary rate. Executive shall also be entitled
to continue to participate in and to receive benefits on the same
basis as other executive or senior staff members under any of the
Company's employee benefit plans as in effect from time to
time. In addition, Executive shall be entitled to the
benefits afforded to other employees similarly situated under the
Company's vacation, holiday and business expense reimbursement
policies. Executive agrees to devote his/her full
business time, energy and skill to his/her duties at the
Company. These duties shall include, but not be limited
to, any duties consistent with Executive's position which may be
assigned to Executive from time to time.
3. Equity
Award Vesting Upon Change of Control. All op
|
