Exhibit 10.1
INFINERA
CORPORATION
AMENDED AND RESTATED CHANGE OF
CONTROL SEVERANCE AGREEMENT
This Amended and Restated Change of
Control Severance Agreement (the “Agreement”) is made
and entered into by and between «Name»
(“Executive”) and Infinera Corporation (the
“Company”), effective as of [DATE] (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 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 Board believes that it is
imperative to provide Executive with certain 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. This Agreement amends and
restates the Change of Control Severance Agreement dated
February 28, 2007 between the Company and
Executive.
5. 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 terminate upon the date that 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, 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 prior to a Change of Control,
Executive will not be entitled to any payments, benefits, damages,
awards or compensation other than as provided by this Agreement or
under his or her Employment Agreement.
3. Severance Benefits
.
(a) Involuntary Termination
Following a Change of Control . If (i) within twelve
(12) months following a Change of Control, (A) the
Company (or any parent or subsidiary of the Company) terminates
Executive’s employment without Cause, or (B) Executive
resigns his or her employment as a result of a Constructive
Termination, and (ii) Executive signs and does not revoke a
standard release of claims with the Company in a form acceptable to
the Company, then Executive will receive the following severance
from the Company:
(i) Severance Payment .
Executive will receive a lump sum severance payment (less
applicable withholding taxes) equal to twelve (12) months of
Executive’s base salary (as in effect immediately prior to
(A) the Change of Control, or (B) Executive’s
termination, whichever is greater).
(ii) Equity Awards
.
(1) Initial Equity Awards .
Fifty percent (50%) of the original total of each equity award
granted to Executive in connection with Executive’s initial
employment with the Company (the “Initial Awards”) will
immediately vest and, if applicable, become exercisable (that is,
in addition to the portion of any such Initial Awards that had
vested as of such termination, but in no event more than the
original amount of such Initial Awards), but only if Executive was
initially employed with the Company as a Vice President or other
executive officer. The Initial Awards will, to the extent
applicable, remain exercisable following Executive’s
termination for the period prescribed in the related award
agreement.
(2) Subsequent Equity Awards
. One hundred percent (100%) of the then unvested portion of
any equity awards granted to Executive following the Initial Awards
and while Executive was serving as an executive officer of the
Company (the “Subsequent Awards”) will immediately vest
and, if applicable, become exercisable. The Subsequent Awards will,
to the extent applicable, remain exercisable following
Executive’s termination for the period prescribed in the
related award agreements.
(iii) Continued Employee
Benefits . If Executive elects continuation coverage pursuant
to the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”) for Executive and Executive’s
eligible dependents, within the time period prescribed pursuant to
COBRA, the Company will reimburse Executive for the COBRA premiums
for such coverage (at the coverage levels in effect immediately
prior to Executive’s termination) until the earlier of
(A) a period of twelve (12) months from the last date of
employment of 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.
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(b) Timing of Severance
Payments . Subject to Section 3(f), 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. If Executive should die before all
amounts have been paid, such unpaid amounts will be paid in a
lump-sum payment (less any withholding taxes) to Executive’s
designated beneficiary, if living, or otherwise to the personal
representative of Executive’s estate.
(c) Voluntary Resignation;
Termination For Cause . If Executive’s employment with
the Company terminates (i) voluntarily by Executive (other
than as a result of a Constructive Termination) or (ii) for
Cause by the Company (or any parent or subsidiary of 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.
(d) 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 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.
(e) Exclusive Remedy . In the
event of a termination of Executive’s employment with the
Company (or any parent or subsidiary of the Company), the
provisions of this Section 3 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. Executive
will be entitled to no benefits, compensation or other payments or
rights upon termination of employment other than those benefits
expressly set forth in this Section 3.
(f) Section 409A
.
(i) 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 (other than due to death), then the 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
(together, the “Deferred Compensation Separation
Benefits”) that are 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. Notwithstanding
anything herein to the contrary, if Executive dies following his or
her termination but prior to the six (6) month anniversary of
his or her termination, 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.
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(ii) 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 shall not constitute Deferred Compensation
Separation Benefits for purposes of clause
(i) above.
(iii) 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 shall not constitute
Deferred Compensation Separation Benefits for purposes of clause
(i) above.
(iv) The foregoing provisions are
intended to comply with the
