Exhibit 10.1
EVERGREEN SOLAR, INC.
CHANGE OF CONTROL SEVERANCE AGREEMENT
This Change of Control Severance
Agreement (the “Agreement”) is made and entered into by
and between Rodolfo Archbold (“Executive”) and
Evergreen Solar, Inc. (the “Company”), effective as of
July 30, 2007 (the “Effective Date”).
RECITALS
1. It is expected that the
Company from time to time will consider the possibility of an
acquisition by another company or other change of control. The
Board of Directors of the Company (the “Board”)
recognizes that such consideration can be a distraction to
Executive and can cause Executive to consider alternative
employment opportunities. The Board has determined that it is in
the best interests of the Company and its stockholders to assure
that the Company will have the continued dedication and objectivity
of Executive, notwithstanding the possibility, threat or occurrence
of a Change of Control (as defined herein) of the Company.
2. The Board believes that it is
in the best interests of the Company and its stockholders to
provide Executive with an incentive to continue his employment and
to motivate Executive to maximize the value of the Company upon a
Change of Control for the benefit of its stockholders.
3. The Board believes that it is
imperative to provide Executive with certain benefits upon a Change
of Control and with certain severance benefits upon
Executive’s termination of employment following a Change of
Control. These benefits will provide Executive with enhanced
financial security and incentive and encouragement to remain with
the Company notwithstanding the possibility of a Change of
Control.
4. Certain capitalized terms
used in the Agreement are defined in Section 7 below.
AGREEMENT
NOW, THEREFORE, in consideration of
the mutual covenants contained herein, the parties hereto agree as
follows:
1. Term of Agreement .
This Agreement will have a term of three (3) years commencing
on the Effective Date. On the third anniversary of the Effective
Date, and on each annual anniversary of the Effective Date
thereafter, this Agreement automatically will renew for an
additional one (1)-year term unless either party provides the other
party with written notice of non-renewal at least thirty
(30) days prior to the date of automatic renewal.
2. At-Will Employment .
The Company and Executive acknowledge that Executive’s
employment is and will continue to be at-will, as defined under
applicable law, except as may otherwise be specifically provided
under the terms of any written formal employment agreement between
the Company and Executive (an “Employment Agreement”).
If Executive’s employment terminates for any reason,
including (without limitation) any termination not set for in
Section 4
hereof,
Executive will not be entitled to any payments, benefits, damages,
awards or compensation other than as provided by this Agreement or
under Executive’s Employment Agreement.
3. Acceleration of Vesting
on Change of Control . Upon the consummation of a Change of
Control (i) Executive’s outstanding equity awards,
including without limitation stock options and restricted stock,
will immediately vest and become exercisable or become released
from the Company’s repurchase or reacquisition right as to
(A) that number of unvested shares that would have vested
during the period between the equity awards’ most recent
vesting date (or grant date if no vesting date has been reached)
and the Change of Control if the equity awards had been granted
with a monthly vesting schedule and (B) that number of
unvested shares that would have otherwise vested during the last
twelve (12) months of each equity awards’ vesting
schedule, and (ii) all performance targets for all of
Executive’s performance-based equity awards will be deemed
fully achieved on the first anniversary of the Change of Control if
Executive is employed on such date.
4. Severance Benefits
.
(a)
Termination without Cause or Resignation for Good Reason in
Connection with a Change of Control . If the Company or its
Affiliates terminate Executive’s employment with the Company
or its Affiliates, respectively, without Cause or Executive resigns
from such employment for Good Reason within twelve (12) months
following a Change of Control, and Executive signs and does not
revoke a separation agreement and release of claims with the
Company (in a form acceptable to the Company), then Executive will
receive the following severance from the Company:
(i)
Accrued Compensation . The Company will pay Executive all
accrued but unpaid vacation, expense reimbursements, wages, and
other benefits due to Executive under any Company-provided plans,
policies, and arrangements.
(ii)
Severance Payment . Executive will receive monthly severance
payments (less applicable withholding taxes) for twelve
(12) months following Executive’s termination equal to
(A) one-twelfth of Executive’s annual base salary as in
effect immediately prior to Executive’s termination date or
(if greater) at the level in effect immediately prior to the Change
of Control, and (B) one-twelfth of Executive’s target
bonus for the year of Executive’s termination. Subject to
Section 5, the Company will pay the severance payments to
which Executive is entitled as salary continuation on the same
basis and timing as in effect immediately prior to the Change of
Control.
(iii)
Equity . All of Executive’s outstanding equity awards,
including without limitation stock options and restricted stock,
will immediately vest and become exercisable or become released
from the Company’s repurchase or reacquisition right.
(iv)
Continued Employee Benefits . Executive will receive
Company-paid coverage for a period of twelve (12) months for
Executive and Executive’s eligible dependents under the
Company’s Benefit Plans.
For purposes of this
Section 4(a), if Executive’s employment with the Company
or one of its Affiliates terminates, he will not be determined to
have been terminated without Cause, if he
continues to remain employed by the Company or one of its
Affiliates (e.g., upon transfer from one Affiliate to another);
provided, however, that the parties understand and acknowledge that
any such termination could potentially result in Executive’s
ability to resign for Good Reason.
(b)
Voluntary Resignation; Termination for Cause . If
Executive’s employment with the Company or its Affiliates
terminates (i) voluntarily by Executive (other than for Good
Reason within twelve (12) months following a Change of
Control) or (ii) for Cause by the Company, then Executive will
not be entitled to receive severance or other benefits except for
those (if any) as may then be established under the Company’s
then existing severance and benefits plans and practices or
pursuant to other written agreements with the Company, including,
without limitation, any Employment Agreement.
(c)
Disability; Death . If the Company terminates
Executive’s employment as a result of Executive’s
Disability, or Executive’s employment terminates due to his
death, then Executive will not be entitled to receive severance or
other benefits except for those (if any) as may then be established
under the Company’s then existing written severance and
benefits plans and practices or pursuant to other written
agreements with the Company, including, without limitation, any
Employment Agreement.
(d)
Exclusive Remedy . In the event of a termination of
Executive’s employment as set forth in Section 4(a), the
provisions of this Section 4 are intended to be and are
exclusive and in lieu of any other rights or remedies to which
Executive or the Company may otherwise be entitled, whether at law,
tort, contract, or in equity. Executive will be entitled to no
benefits, compensation or other payments or rights upon termination
of employment following a Change of Control other than those
benefits expressly set forth in this Section 4.
5. Code
Section 409A .
(a)
Distributions . Notwithstanding anything to the contrary in
this Agreement, if Executive is a “specified employee”
within the meaning of Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”) and the final
regulations and any guidance promulgated thereunder
(“Section 409A”) at the time of Executive’s
termination, and the severance payable to Executive, if any,
pursuant to this Agreement, when considered together with any other
severance payments or separation benefits which may be considered
deferred compensation under Section 409A (together, the
“Deferred Compensation Separation Benefits”) will not
and could not under any circumstances, regardless of when such
termination occurs, be paid in full by the fifteenth day of the
third month of the Company’s fiscal year following
Executive’s termination, then only that portion of the
Deferred Compensation Separation Benefits which do not exceed the
Section 409A Limit (as defined below) may be made within the
first six (6) months following Executive’s termination
of employment in accordance with the payment schedule applicable to
each such payment or benefit. For these purposes, each severance
payment and benefit is hereby designated as a separate payment and
will not collectively be treated as a single payment. Any portion
of the Deferred Compensation Separation Benefits in excess of the
Section 409A Limit shall accrue and, to the extent such
portion of the Deferred Compensation Separation Benefits would
otherwise have been payable within the first six (6) months
following Executive’s termination of employment, will become
payable on the first payroll date that occurs on or after the date
six (6) months and one (1) day following the date of
Executive’s termination of employment. All subsequent
Deferred Compensation Separation Benefits, if any, will be payable
in accordance with the payment schedule applicable to each payment
or benefit.
(b)
Amendment . This provision is intended to comply with the
requirements of Section 409A so that none of the severance payments
and benefits to be provided hereunder will be subject to the
additional tax imposed under Section 409A, and any ambiguities
herein will be interpreted to so comply. The Company and Executive
agree to work together in good faith to consider amendments to this
Agreement and to take such reasonable actions which are necessary,
appropriate or desirable to avoid imposition of any additional tax
or income recognition prior to actu
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