PLANTRONICS, INC.
CHANGE OF CONTROL SEVERANCE
AGREEMENT
This Change of Control Severance Agreement (the
“Agreement”) is made and entered into by and between
____________ (“Executive”) and Plantronics, Inc., a
Delaware corporation (the “Company”), effective as of
____________ (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 Compensation Committee of the Board of
Directors of the Company (the “Committee”) recognizes
that such consideration can be a distraction to Executive and can
cause Executive to consider alternative employment
opportunities. The Committee 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 of the Company.
2. The Committee
believes that it is in the best interests of the Company and its
stockholders to provide Executive with an incentive to continue his
or her 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 Committee
believes that it is imperative to provide Executive 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 6
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 an initial term
of two (2) years commencing on the Effective Date (the
“Initial Term”). On the second anniversary
of the Effective Date, this Agreement will renew automatically for
an additional one (1) year term (the “Additional Term”)
unless either party provides the other party with written notice of
non-renewal at least sixty (60) days prior to the date of automatic
renewal. Notwithstanding the foregoing sentence, if a
Change of Control occurs at any time during either the Initial Term
or an Additional Term, the term of this Agreement will extend
automatically through the date that is twenty-four (24) months
following the effective date of the Change of
Control. If Executive becomes entitled to benefits under
Section 3 or Section 4 during the term of this Agreement, the
Agreement will not terminate until all of the obligations of the
parties hereto with respect to this Agreement have been
satisfied.
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. If
Executive’s employment terminates for any reason, including
(without limitation) any termination that occurs other than during
the period that is on or within twenty-four (24) months after a
Change of Control as provided herein, Executive will not be
entitled to any payments, benefits, damages, awards or compensation
other than as provided by this Agreement or as provided in any
employment agreement entered into between the Company and
Executive, and the payment of accrued but unpaid wages, as required
by law, and any unreimbursed reimbursable expenses.
3. Change of
Control . In the event of a Change of Control, and
subject to Executive’s continued employment with the Company
through the effective date of such Change of Control, all
outstanding equity awards will vest according to the vesting
schedule specified in the 2003 Stock Option Plan.
(a) Termination
without Cause or Resignation for Good Reason in Connection with a
Change of Control . If the Company terminates
Executive’s employment with the Company without Cause or if
Executive resigns from such employment for Good Reason, and such
termination occurs on or within twenty-four (24) months after a
Change of Control, and Executive signs and does not revoke a
release of claims with the Company (in a form reasonably acceptable
to the Company) and provided that such release of claims becomes
effective no later than sixty (60) days following the termination
date or such earlier date required by the release agreement (such
deadline, the “Release Deadline”), then subject to this
Section 4, Executive will receive the following:
(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 a lump-sum payment
(less applicable withholding taxes) equal to the sum of (A) 100% 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, (B) 100% of
Executive’s quarterly target incentive bonus, and (C) 100% of
Executive’s annual target incentive bonus.
(iii) Continued
Employee Benefits . If Executive elects continuation
coverage pursuant to the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended (“COBRA”) or the California
Continuation Benefits Replacement Act, as amended
(“Cal-COBRA”) for periods of coverage beyond that
permitted by COBRA for Executive and Executive’s eligible
dependents, within the time period prescribed pursuant to COBRA ,
or Cal-COBRA, as applicable, the Company will reimburse Executive
for the COBRA (or, if applicable, Cal-COBRA) premiums for such
coverage (at the coverage levels in effect immediately prior to
Executive’s termination) until the earlier of (A) a period
twelve (12) months from the last date of employment of the
Executive with the Company, or (B) the date upon which Executive
and/or Executive’s eligible dependents becomes
covered under similar plans. COBRA reimbursements will
be made by the Company to Executive consistent with the
Company’s normal expense reimbursement policy.
(iv) Equity
Awards . Any equity awards (including, without
limitation, any awards of stock options, restricted stock,
restricted stock units, and/or performance shares or units)
outstanding as of the date of such termination will vest in full as
to 100% of the unvested portion of the award.
(1) If the release of
claims does not become effective by the Release Deadline, Executive
will forfeit any rights to severance or benefits under this
Agreement. In no event will severance payments or
benefits be paid or provided until the release of claims actually
becomes effective. In the event the termination occurs
at a time during the calendar year where the release of claims
could become effective in the calendar year following the calendar
year in which Executive’s termination occurs (whether or not
it actually becomes effective in the following year), then any
severance payments or benefits under this Agreement that would be
considered Deferred Compensation Severance Benefits (as defined in
Section 4(f)(i)) will be paid on the first payroll date to occur
during the calendar year following the calendar year in which such
termination occurs, or, if later, (i) the date the release of
claims actually becomes effective, (ii) such time as required by
the payment schedule applicable to each payment or benefit as set
forth in Section 4(a)(ii)), or (iii) such time as required by this
Section 4(f).
(2) Unless otherwise
required by Section 4(f), the Company will pay any severance
payments in a lump-sum payment payable within thirty (30) days
following Executive’s termination date; provided, however,
that no severance or other benefits will be paid or provided until
the release of claims discussed in Section 4(a) becomes effective
and irrevocable, and any severance amounts or benefits otherwise
payable between Executive’s termination date and the date
such release becomes effective and irrevocable will be paid on the
date the release becomes effective and irrevocable. If
Executive should die before all of the severance amounts have been
paid, such unpaid amounts will be paid in a lump-sum payment
promptly following such event to Executive’s designated
beneficiary, if living, or otherwise to the personal representative
of Executive’s estate.
(b) Voluntary
Resignation; Termination for Cause . If
Executive’s employment with the Company terminates (i)
voluntarily by Executive (other than for Good Reason during the
period that is on or within twenty-four (24) months after 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.
(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 or her death,
then Executive will not be entitled to receive any other 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.
(d) Termination not
in Connection with a Change of Control . In the
event Executive’s employment is terminated for any reason
other than as provided in Section 4(a), then Executive will be
entitled to receive severance and any other benefits only as may
then be established under the Company’s existing written
severance and benefits plans and practices or pursuant to other
written agreements with the Company.
(e) Exclusive
Remedy . In the event of a Change of Control, or a
termination of Executive’s employment as set forth in Section
4(a) of this Agreement, the provisions of Section 3 and Section 4,
as applicable, 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 or contract, in equity,
or under this Agreement (other than the payment of accrued but
unpaid wages, as required by law, and any unreimbursed reimbursable
expenses). Executive will be entitled to no benefits,
compensation or other payments or rights upon a Change of Control
or a termination of employment following a Change of Control other
than those benefits expressly set forth in Section 3 or Section 4
of this Agreement.
(i) Notwithstanding
anything to the contrary in this Agreement, no severance payable to
Executive, if any, pursuant to this Agreement, when considered
together with any other severance payments or separation benefits
that are considered deferred compensation under Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”)
and the final regulations and any guidance promulgated thereunder
(“Section 409A”) (together, the “Deferred
Compensation Separation Benefits”) will be payable until
Executive has a “separation from service” within the
meaning of Section 409A.
(ii) Notwithstanding
anything to the contrary in this Agreement, if Executive is a
“specified employee” within the meaning of Section 409A
at the time of Executive’s termination (other than due to
death), then the Deferred Compensation Separation Benefits that are
payable within the first six (6) months following Executive’s
separation from service, 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 separation from
service. All subsequent Deferred Compensation Separation
Benefits, if any, will be payable in accordance with the payment
schedule applicable to each payment or
benefit. Notwithstanding anything herein to the
contrary, if Executive dies following Executive’s separation
from service but prior to the six (6) month anniversary of the
separation, then any payments delayed in accordance with this
paragraph will be payable in a lump sum as soon as administratively
practicable after the date of Executive’s death and all other
Deferred Compensation Separation Benefits will be payable in
accordance with the payment schedule applicable to each payment or
benefit. Each payment and benefit payable under this
Agreement is intended to constitute separate payments for purposes
of Section 1.409A-2(b)(2) of the Treasury Regulations.
(iii) Any amount paid
under this Agreement that satisfies the requirements of the
“short-term deferral” rule set forth in Section
1.409A-1(b)(4) of the Treasury Regulations will not constitute
Deferred Compensation Separation Benefits for purposes of clause
(i) above.
(iv) Any amount paid
under this Agreement that qualifies as a payment made as a result
of an involuntary separation from service pursuant to Section
1.409A-1(b)(9)(iii) of the Treasury Regulations that do not exceed
the Section 409A Limit (as defined below) will not constitute
Deferred Compensation Separation Benefits for purposes of clause
(i) above.
(v) The foregoing
provisions are 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 a
