Exhibit 10.21
TIBCO Software Inc. Change in
Control and Severance Plan
Amended and Restated
December 10, 2008
1. Introduction. The purpose
of this TIBCO Software Inc. Change in Control and Severance Plan
(the “Plan”) is to provide assurances of specified
severance benefits to eligible employees of the Company whose
employment is subject to being involuntarily terminated (other than
for Cause, death or permanent disability) or terminated for Good
Reason under the circumstances described in the Plan, including but
not limited to following a Change in Control of the Company. The
Company recognizes that the potential of a Change in Control can be
a distraction to employees and can cause such employees to consider
alternative employment opportunities. The Plan is intended to
(i) assure that the Company will have continued dedication and
objectivity of its employees, notwithstanding the possibility,
threat or occurrence of a Change in Control and (ii) provide
the Company’s employees with an incentive to continue their
employment and to motivate its employees to maximize the value of
the Company prior to and following a Change in Control for the
benefit of its stockholders. This Plan is an “employee
welfare benefit plan,” as defined in Section 3(1) of the
Employee Retirement Income Security Act of 1974, as amended. This
document constitutes both the written instrument under which the
Plan is maintained and the required summary plan description for
the Plan.
2. Important Terms. To help
you understand how this Plan works, it is important to know the
following terms:
2.1
“Administrator” means the Company, acting
through its EVP, General Counsel & Secretary or any person
to whom the Administrator has delegated any authority or
responsibility pursuant to Section 7, but only to the extent
of such delegation.
2.2 “Base Pay”
means a Covered Employee’s regular straight-time salary as in
effect during the last regularly scheduled payroll period
immediately preceding the date on which the Severance Benefit
becomes payable. Base Pay does not include payments for overtime,
shift premium, incentive compensation, incentive payments, bonuses,
commissions or other compensation.
2.3 “Board” means
the Board of Directors of the Company.
2.4 “Cause” means
(i) an act of fraud or personal dishonesty undertaken by a
Covered Employee in connection with the Covered Employee’s
responsibilities as an employee that is intended to result in
substantial gain or personal enrichment of the Covered Employee at
the expense of the Company, (ii) a Covered Employee’s
conviction of, or plea of nolo contendere to, a felony,
(iii) a Covered Employee’s gross misconduct in
connection with the performance or failure of performance of a
material component of the Covered Employee’s responsibilities
as an employee that is materially injurious to the Company, or
(iv) a Covered Employee’s continued substantial
violations of his or her employment duties after the Covered
Employee has received a written demand for performance from the
Company which specifically sets forth the factual basis for the
Company’s belief that the Covered Employee has not
substantially performed such duties.
1
2.5 “Change in
Control” means (a) a sale of all or substantially
all of the Company’s assets, (b) any merger,
consolidation, or other business combination transaction of the
Company with or into another corporation, entity, or person, other
than a transaction in which the holders of at least a majority of
the shares of voting capital stock of the Company outstanding
immediately prior to such transaction continue to hold (either by
such shares remaining outstanding or by their being converted into
shares of voting capital stock of the surviving entity) a majority
of the total voting power represented by the shares of voting
capital stock of the Company (or the surviving entity) outstanding
immediately after such transaction, (c) the direct or indirect
acquisition (including by way of a tender or exchange offer) by any
person, or persons acting as a group, of beneficial ownership or a
right to acquire beneficial ownership of shares representing a
majority of the voting power of the then outstanding shares of
capital stock of the Company, (d) a contested election of
Directors, as a result of which or in connection with which the
persons who were Directors before such election or their nominees
cease to constitute a majority of the Board, or (e) a
dissolution or liquidation of the Company.
2.6 “Change in Control
Determination Period” means the time period beginning on
the date of the Change in Control and ending twelve months
following the Change in Control.
2.7 “Change in Control
Severance Benefit” means the compensation and other
benefits the Covered Employee will be provided pursuant to Section
4.
2.8 “Company”
means TIBCO Software Inc., a Delaware corporation, and any
successor by merger, acquisition, consolidation or otherwise that
assumes the obligations of the Company under the Plan.
2.9 “Covered
Employee” means an employee of the Company who has been
designated by the Administrator to participate in the Plan. Each
such designated employee is shown on Appendix A and/or Appendix B
attached hereto as a “Covered Employee.”
2.10 “Effective
Date” means July 10, 2005.
2.11 “ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
2.12 “Good
Reason” means without the Covered Employee’s
written consent, after (a) a material reduction in the Covered
Employee’s authority, status or responsibilities (including
reporting responsibilities) relative to the Covered
Employee’s authority, status or responsibilities in effect
immediately prior to such reduction where such reduction was
imposed without Cause; (b) a reduction in the Covered
Employee’s annualized Base Pay, without the Covered
Employee’s written consent (unless the Company also reduces
the Base Pay of substantially all other employees of the Company);
(c) a reduction in the kind or level of benefits (not
including Base Pay, target bonus or equity compensation) for which
the Covered Employee is eligible (unless the Company also reduces
the kind or level of benefits available to substantially all other
employees of the Company); or (d) the relocation of the
Covered Employee’s principal place of performing his or her
duties as an employee of the Company by more than thirty
(30) miles. Notwithstanding the foregoing, an event described
in this Section 2.11 shall not constitute Good Reason unless
it is communicated by the Covered Employee to the Company in
writing and is not corrected by the Company in a manner which is
reasonably satisfactory to such Covered Employee (including full
retroactive correction with respect to any monetary matter) within
10 days of the Company’s receipt of such written
notice.
2.13 “Involuntary
Termination” means a termination of employment of a
Covered Employee under the circumstances described in Sections 4.1
and 5.1.
2.14 “Plan” means
the TIBCO Software Inc. Change in Control and Severance Plan, as
set forth in this document, and as hereafter amended from time to
time.
2
2.15 “Severance
Benefit” means the compensation and other benefits the
Covered Employee will be provided pursuant to
Section 5.
2.16 “Target
Bonus” means, with respect to a Covered Employee, the
Covered Employee’s target bonus pursuant to the
Company’s Executive Incentive Compensation Plan or any other
applicable corporate bonus plan (a) at the rate in effect as
of the date of the Covered Employee’s termination, or at a
rate of 100% if no such rate is in effect as of the date of the
Covered Employee’s termination, or, if higher, at the rate in
effect as of any date within the twelve-month period preceding the
date of the Covered Employee’s termination and
(b) assuming one hundred percent (100%) achievement of
the Covered Employee’s and the Company’s objectives, if
any. Notwithstanding the foregoing, the Covered Employee’s
target bonus for purposes of the Plan shall be deemed to be the
amount received as a bonus by the Covered Employee for the
Company’s fiscal year preceding the date of the Covered
Employee’s termination if a target bonus has not been
established for the then current fiscal year and the Covered
Employee’s bonuses, if any, are discretionary and not
pursuant to any non-discretionary bonus plan or commission rate
established by the Company. The Covered Employee’s Target
Bonus shall not include amounts attributable to any other bonus,
including, but not limited to, any other discretionary bonuses such
as spot bonuses.
2.17 “Tier 1 Covered
Employee” means (a) with respect to the Change in
Control Severance Benefits provided pursuant to Section 4, any
employee of the Company designated as an employee under Tier 1 as
shown on Appendix A attached hereto and (b) with respect to
the Severance Benefits provided pursuant to Section 5, any
employee of the Company who, immediately prior to the Change of
Control, has the employee title designated under Tier 1 as shown on
Appendix B attached hereto.
2.18 “Tier 2 Covered
Employee” means (a) with respect to the Change in
Control Severance Benefits provided pursuant to Section 4, any
employee of the Company designated as an employee under Tier 2 as
shown on Appendix A attached hereto and (b) with respect to
the Severance Benefits provided pursuant to Section 5, any
employee of the Company who, immediately prior to the Change of
Control, has the employee title designated under Tier 2 as shown on
Appendix B attached hereto.
2.19 “Tier 3 Covered
Employee” means (a) with respect to the Change in
Control Severance Benefits provided pursuant to Section 4, any
employee of the Company designated as an employee under Tier 3 as
shown on Appendix A attached hereto and (b) with respect to
the Severance Benefits provided pursuant to Section 5, any
employee of the Company who, immediately prior to the Change of
Control, has the employee title designated under Tier 3 as shown on
Appendix B attached hereto.
2.20 “Tier 4 Covered
Employee” means any employee of the Company designated as
an employee under Tier 4 as shown on Appendix A attached
hereto.
3. Eligibility for Change in
Control Severance Benefits and Severance Benefits . An
individual is eligible for the Change in Control Severance Benefit
or the Severance Benefit under the Plan, in the amount set forth in
Section 4 or Section 5, respectively, only if he
or she is a Covered Employee on the date he or she experiences an
Involuntary Termination.
3
4. Change in Control Severance
Benefit.
4.1 Involuntary Termination
Following a Change in Control . If at any time within the
Change in Control Determination Period (i) a Covered Employee
terminates his or her employment with the Company (or any parent or
subsidiary of the Company) for Good Reason, or (ii) the
Company (or any parent or subsidiary of the Company) terminates
such Covered Employee’s employment for other than Cause,
death or permanent disability, then, subject to the Covered
Employee’s compliance with Section 7, the Covered
Employee shall receive the following Change in Control Severance
Benefit from the Company:
4.1.1 Change in Control Severance
Benefit .
4.1.1.1 Tier 1 Covered
Employee . If the Covered Employee is a Tier 1 Covered
Employee, he or she shall be entitled to receive a lump sum cash
payment equal to twelve (12) months of Base Pay and the
Covered Employee’s Target Bonus.
4.1.1.2 Tier 2 Covered
Employee . If the Covered Employee is a Tier 2 Covered
Employee, he or she shall be entitled to receive a lump sum cash
payment equal to nine (9) months of Base Pay and nine
(9) months of the Covered Employee’s Target
Bonus.
4.1.1.3 Tier 3 Covered
Employee . If the Covered Employee is a Tier 3 Covered
Employee, he or she shall be entitled to receive a lump sum cash
payment equal to six (6) months of Base Pay and six
(6) months of the Covered Employee’s Target
Bonus.
4.1.1.4 Tier 4 Covered
Employee . If the Covered Employee is a Tier 4 Covered
Employee, he or she shall be entitled to receive a lump sum cash
payment equal to three (3) months of Base Pay and three
(3) months of the Covered Employee’s Target
Bonus.
4.1.2 Continued Medical
Benefits . If the Covered Employee, and any spouse and/or
dependents of the Covered Employee (“Family Members”)
has medical and dental coverage on the date of Covered
Employee’s termination of employment under a group health
plan sponsored by the Company, the Company will reimburse Covered
Employee for the total applicable premium cost for medical and
dental coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1986, 29 U.S.C. Sections 1161-1168; 26 U.S.C.
Section 4980B(f), as amended, and all applicable regulations
(referred to collectively as “COBRA”) for Covered
Employee and his Family Members as follows:
4.1.2.1 Tier 1 Covered
Employee . For a period of up to twelve
(12) months.
4.1.2.2 Tier 2 Covered
Employee . For a period of up to nine
(9) months.
4.1.2.3 Tier 3 Covered
Employee . For a period of up to six
(6) months.
4.1.2.4 Tier 4 Covered
Employee . For a period of up to three
(3) months.
Notwithstanding the forgoing, the
Company shall have no obligation to reimburse the Covered Employee
for the premium cost of COBRA coverage beginning on or after the
date the Covered Employee and his Family Members first become
eligible to obtain comparable benefits from a subsequent
employer.
4
4.1.3 Equity Award Accelerated
Vesting.
4.1.3.1 Tier 1 Covered
Employee . Fifty (50) percent of each Tier 1 Covered
Employee’s outstanding and unvested equity compensation
awards, as determined on such Covered Employee’s date of
termination, shall automatically accelerate, all restrictions or
repurchase rights applicable thereto shall immediately lapse, and
any performance goals or other vesting criteria applicable thereto
shall be deemed achieved at target levels so as to become fully
vested and exercisable. The period over which such equity
compensation awards may be exercised shall be governed by the
applicable provisions of the Company’s Stock Plans and
related award agreements.
4.1.3.2 Tier 2 and Tier 3 Covered
Employees . Twenty-five (25) percent of each Tier 2
Covered Employee’s and each Tier 3 Covered Employee’s
outstanding and unvested equity compensation awards, as determined
on such Covered Employee’s date of termination, shall
automatically accelerate, all restrictions or repurchase rights
applicable thereto shall immediately lapse, and any performance
goals or other vesting criteria applicable thereto shall be deemed
achieved at target levels so as to become fully vested and
exercisable. The period over which such equity compensation awards
may be exercised shall be governed by the applicable provisions of
the Company’s Stock Plans and related award
agreements.
4.1.3.3 Tier 4 Covered
Employee . The acceleration of vesting upon a Change in Control
of each Tier 4 Covered Employee’s outstanding and unvested
equity compensation awards, as determined on such Covered
Employee’s date of termination, and the period over which
such equity compensation awards may be exercised shall be governed
by the applicable provisions of the Company’s Stock Plans and
related award agreements.
5. Severance
Benefit.
5.1 Involuntary Termination Other
Than During the Change in Control Determination Period . If at
any time after the Change in Control Determination Period
(i) a Covered Employee terminates his or her employment with
the Company (or any parent or subsidiary of the Company) for Good
Reason, or (ii) the Company (or any parent or subsidiary of
the Company) terminates such Covered Employee’s employment
for other than Cause, death or permanent di
