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WEB.COM GROUP, INC. AMENDED AND RESTATED EXECUTIVE SEVERANCE BENEFIT PLAN

Employee Benefits Plan Agreement

WEB.COM GROUP, INC.

 

AMENDED AND RESTATED

 

EXECUTIVE SEVERANCE BENEFIT PLAN | Document Parties: WEB.COM GROUP, INC. You are currently viewing:
This Employee Benefits Plan Agreement involves

WEB.COM GROUP, INC.

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Title: WEB.COM GROUP, INC. AMENDED AND RESTATED EXECUTIVE SEVERANCE BENEFIT PLAN
Date: 3/6/2009
Industry: Software and Programming     Sector: Technology

WEB.COM GROUP, INC.

 

AMENDED AND RESTATED

 

EXECUTIVE SEVERANCE BENEFIT PLAN, Parties: web.com group  inc.
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Exhibit 10.6

 

WEB.COM GROUP, INC.

 

AMENDED AND RESTATED

 

EXECUTIVE SEVERANCE BENEFIT PLAN

 

Section 1.       INTRODUCTION.

 

The Web.com Group, Inc. Executive Severance Benefit Plan (the “ Plan ”) was established effective April 6, 2005, and amended and restated on October 23, 2007 and December 11, 2008.  The purpose of the Plan is to provide for the payment of severance benefits to certain executive employees of Web.com Group, Inc. (the “ Company ”) upon the termination of their employment under specified circumstances.  This Plan shall supersede any executive severance benefit plan, policy or practice previously maintained by the Company for any Eligible Employee (as defined in Section 2(a)(1) below).  This Plan document is also the Summary Plan Description for the Plan.

 

Section 2.       ELIGIBILITY FOR BENEFITS.

 

(a)       General Rules.   Subject to the requirements set forth herein, the Company will grant severance benefits under the Plan to Eligible Employees.

 

(1)       Definition of “ Eligible Employee .” For purposes of this Plan, Eligible Employees shall be those employees of the Company who are approved for participation in the Plan by the Company’s Board of Directors (the “ Board ”) as listed in APPENDIX A hereto.  The determination of whether an employee is an Eligible Employee shall be made by the Board, in its sole discretion, and such determination shall be binding and conclusive on all persons.  If an employee who is deemed an Eligible Employee by the Board has an individually negotiated employment agreement with the Company relating to severance benefits that is in effect on his or her termination date, the provisions of that agreement relating to severance benefits shall be superseded by the terms of this Plan; provided, however , that all other remaining provisions of that agreement shall remain in effect.

 

(2)       Release of Claims.   To be eligible to receive benefits under the Plan, an Eligible Employee must execute a general waiver and release in substantially the form attached hereto as EXHIBIT A , EXHIBIT B or EXHIBIT C , as appropriate, within the time provided therein, and such release must become effective in accordance with its terms, but in all cases the release must become effective within 60 days following the date of the Eligible Employee’s “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)).  The Company, in its sole discretion, may modify the form of the required release to comply with applicable law and shall determine the form of the required release, which may be incorporated into a termination agreement or other agreement with the Eligible Employee.  Such release shall include non-competition and non-solicitation provisions as deemed appropriate by the Company in its sole discretion.

 

(3)       Return of Property.   To be eligible to receive benefits under the Plan, an Eligible Employee must return all Company property which he or she has had in his or her possession at any time, including but not limited to any materials which contain or embody any proprietary or confidential information of the Company and any computers, mobile telephones or other physical property.

 

1.


(b)       Exceptions to Benefit Entitlement.   An employee, including an employee who otherwise is an Eligible Employee, will not receive benefits under the Plan if the employee is terminated for Cause (as defined herein), if the employee resigns without Good Reason (as defined herein), or if the employee’s employment is terminated as a result of the employee’s death or disability, in each case as determined by the Company in its sole discretion.

 

Section 3.       AMOUNT OF BENEFIT.

 

(a)       Termination without Cause or Resignation for Good Reason.   If at any time the Company terminates an Eligible Employee’s employment without Cause (as defined herein), or the Eligible Employee resigns for Good Reason (as defined herein), and such termination constitutes a “separation from service” (as defined above), the Company shall provide the Eligible Employee with the following severance benefits:

 

(1)        A cash severance benefit in an amount equal to the sum of (i) six (6) months of the Eligible Employee’s Base Salary (as defined herein) and (ii) 50% of the greater of (A) 80% of the Eligible Employee’s Target Bonus (as defined herein) for the year in which the termination occurs and (B) the prior year’s Target Bonus actually earned by the Eligible Employee, subject to withholdings and deductions, which aggregate amount shall be paid in the form of substantially equal installments on the Company’s regular payroll dates for the first six (6) months following the date of the Eligible Employee’s termination; provided, however , no payments shall be made prior to the effective date of the Eligible Employee’s release of claims.  On the first regular payroll date following the effective date of the Eligible Employee’s release of claims, the Company will pay the Eligible Employee the payments that would have been paid on and through such date pursuant to the prior sentence but for the delay pending the effectiveness of the release, with the balance of the payments paid thereafter on the original schedule;

 

(2)        Acceleration of the vesting of the unvested shares of common stock held by the Eligible Employee that were issued pursuant to his or her compensatory equity awards and the unvested shares of common stock subject to unexercised stock options then held by the Eligible Employee such that the shares that would have vested under such awards had the Eligible Employee remained employed by the Company for six (6) months following the termination of the Eligible Employee’s employment shall vest and, in the case of options, become immediately exercisable (or, if no shares would vest during such time under a specific award due to a cliff vesting provision, then the number of shares vesting and becoming exercisable pursuant to this paragraph shall equal the product of (i) the total number of shares subject to the award and (ii) a fraction, the numerator of which is six (6) and the denominator of which is the total number of months in the vesting schedule), with such vesting occurring as of the date of the Eligible Employee’s termination (such acceleration of vesting, the “ 6 Month Acceleration ”);

 

(3)        Extension of the post-termination exercise period of all non-statutory stock options then held by the Eligible Employee so that such options, to the extent vested, are exercisable until the earlier of (i) the original term expiration date for such award and (ii) the first anniversary of the Eligible Employee’s termination date; and

 

2.


(4)        Provided that the Eligible Employee is eligible to continue coverage under a health, dental, or vision   plan sponsored by the Company under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“ COBRA ”) at the time of the Eligible Employee’s termination and timely elects such continuation of coverage under COBRA, the Company will pay COBRA premiums on behalf of the Eligible Employee for a period of up to six (6) months following the Eligible Employee’s termination of employment (but in no event longer that the date on which the Eligible Employee ceases to be eligible for COBRA).  Upon the conclusion of such period of insurance premium payments made by the Company, the Eligible Employee will be responsible for the entire payment of premiums required under COBRA for the duration of the COBRA period.  No provision of this Plan will affect the continuation coverage rules under COBRA, except that the Company’s payment of any applicable insurance premiums will be credited as payment by the Eligible Employee for purposes of the Eligible Employee’s payment required under COBRA.  Therefore, the period during which an Eligible Employee may elect to continue the Company’s health, dental, or vision plan coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Eligible Employee, and all other rights and obligations of the Eligible Employee under COBRA (except the obligation to pay insurance premiums that the Company pays in accordance with the foregoing) will be applied in the same manner that such rules would apply in the absence of this Plan.  For purposes of this Section 3(a)(3), (i) references to COBRA shall be deemed to refer also to analogous provisions of state law and (ii) any applicable insurance premiums that are paid by the Company shall not include any amounts payable by the Eligible Employee under an Internal Revenue Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Eligible Employee.

 

(b)       Termination without Cause or Resignation for Good Reason Following a Change of Control.   If the Company terminates an Eligible Employee’s employment without Cause, or the Eligible Employee resigns for Good Reason, at any time during the period commencing on the effective date of a Change of Control (as defined herein) and ending eighteen (18) months following the effective date of the Change of Control, and provided such termination constitutes a separation from service, then the Eligible Employee shall be entitled to the benefits set forth in Section 3(a); provided, however , that in lieu of the 6 Month Acceleration, the vesting (and, in the case of options, exercisability) of each then-unvested equity award held by the Eligible Employee shall be accelerated as to that number of shares equal to the greater of (1) the 6 Month Acceleration and (2) fifty percent (50%) of the then-unvested shares subject to such award, with such accelerated vesting (and exercisability) effective as of the date of the Eligible Employee’s termination of employment.  In the event of a termination of employment on the effective date of a Change of Control, the vesting in Section 3(c) shall apply first and the vesting in this Section 3(b) shall apply second.

 

(c)       Single Trigger Vesting.

 

(1)        Immediately prior to a Change of Control, and subject to the Eligible Employee’s continued employment with the Company through such time, 25% of the then-unvested shares subject to each then-outstanding equity award (or such lesser number as then remain unvested) held by the Eligible Employee shall become fully vested, and, as applicable, exercisable.

 

3.


(2)        In addition, in the event of a Change of Control in which either (i) the acquiring or surviving entity does not agree to assume or otherwise continue an Eligible Employee’s outstanding equity awards, or (ii) the acquiring or surviving entity does assume or otherwise continue the Eligible Employee’s outstanding equity awards but such awards cease to cover shares of common stock that are readily tradable on an established securities market, then 100% of the shares subject to each then-outstanding unvested equity award held by the Eligible Employee shall become fully vested, and, as applicable, exercisable.

 

(d)       Definitions.

 

(1)        For purposes of this Plan, “ Cause ” shall mean (A) conviction of any felony or any crime involving moral turpitude or dishonesty; (B) perpetration of a material fraud or act of dishonesty against the Company; (C) in the event of a termination prior to a Change of Control, persistent, willful and material breach of the Eligible Employee’s duties that has not been cured within 30 days after written notice from the Company’s Board of Directors of such breach; or (D) material breach of any Proprietary Information and Inventions Agreement between the Eligible Employee and the Company that has not been cured within thirty (30) days after written notice from the Company’s Board of Directors, or has cause irreparable damage incapable of cure.

 

(2)        For purposes of this Plan, “ Good Reason ” shall mean the Eligible Employee’s resignation from all positions he or she then-holds with the Company if (A) (I) there is a material adverse change in the Eligible Employee’s position causing such position to be of materially reduced stature or responsibility, (II) there is a material reduction of the Eligible Employee’s base compensation, or (III) the Eligible Employee is required to relocate his or her primary work location to a facility or location that would increase the Eligible Employee’s one way commute distance by more than twenty (20) miles from the Eligible Employee’s primary work location as of immediately prior to such change, (B) the Eligible Employee provides written notice to the Company’s General Counsel within the 60-day period immediately following such material change or reduction, (C) such material change or reduction is not remedied by the Company within thirty (30) days following the Company’s receipt of such written notice and (D) the Eligible Employee’s resignation is effective not later than ninety (90) days after the expiration of such thirty (30) day cure period.

 

(3)       Change of Control. For purposes of the Plan, a “ Change of Control ” shall mean any of the following in connection with which the Eligible Employee receives cash or readily marketable securities in exchange for all or substantially all of the Eligible Employee’s shares of capital stock of the Company: (A) a sale, lease or other disposition in one transaction or a series of transactions, of all or substantially all of the assets of the Company, (B) a merger or consolidation in which the Company is not the surviving entity or if the Company is the surviving entity, as a result of which the shares of the Company’s capital stock are converted into or exchanged for cash, securities of another entity, or other property, unless (in any case) the holders of the Company’s outstanding shares of capital stock immediately before such transaction own more than fifty percent (50%) of the combined voting power of the outstanding securities of the surviving entity immediately after the transaction, (C) the Company’s stockholders approve a plan or proposal to liquidate or dissolve the Company or (D) a person or group hereafter acquires beneficial ownership of more than fifty percent (50%) of the outstanding voting securities of the Company (all within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended, and the regulations promulgated thereunder).

 

4.


(4)       For purposes of calculating Plan benefits, “ Base Salary ” shall mean the Eligible Employee’s base pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of variable compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding the Eligible Employee’s termination (ignoring any reduction in Base Salary that is the basis for the Eligible Employee’s resignation for Good Reason, as applicable).

 

(5)        For purposes of calculating Plan benefits, “ Target Bonus ” shall mean the Eligible Employee’s target bonus amount as most recently determined for the year of termination by the Company, generally (but not necessarily) expressed as a percentage of Base Salary.

 

(e)       Other Employee Benefits.   All other benefits (such as life insurance, disability coverage, and 401(k) plan coverage) terminate as of the Eligible Employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

 

(f)       Certain Reductions.   The Company shall reduce an Eligible Employee’s severance benefits, in whole or in part, by any other severance benefits, pay in lieu of notice, or other similar benefits payable to the Eligible Employee by the Company that become payable in connection with the Eligible Employee’s termination of employment pursuant to (i) any applicable legal requirement, including, without limitation, the Worker Adjustment and Retraining Notification Act (the “ WARN Act ”), or (ii) any Company policy or practice providing for the Eligible Employee to remain on the payroll for a limited period of time after being given notice of the termination of the Eligible Employee’s employment.  The benefits provided under this Plan are intended to satisfy, in whole or in part, any and all statutory obligations that may arise out of an Eligible Employee’s termination of employment, and the Plan Administrator shall so construe and implement the terms of the Plan.  In the Company’s sole discretion, such reductions may be applied on a retroactive basis, with severance benefits previously paid being recharacterized as payments pursuant to the Company’s statutory obligation.

 

Section 4.       LIMITATIONS ON PAYMENTS.

 

(a)       Taxes and Offsets.   All payments under the Plan will be subject to applicable withholding for federal, state and local taxes.  If an Eligible Employee is indebted to the Company at his or her termination date, the Company reserves the right to offset any severance payments under the Plan by the amount of such indebtedness.  In no event shall payment of any Plan benefit be made prior to the Eligible Employee’s separation from service or prior to the effective date of the release described in Section 2(a)(2).

 

(b)       Best After Tax.   If any payment or benefit (including payments and benefits pursuant to this Agreement) that an Eligible Employee would receive in connection with a Change of Control from the Company or otherwise (“ Payment ”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “ Code ”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “ Excise Tax ”), then the Company shall cause to be determined, before any amounts of the Payment are paid to the Eligible Employee, which of the following two alternative forms of payment would maximize the Eligible Employee’s after-tax proceeds: (i) payment in full of the entire amount of the Payment (a “ Full Payment ”), or (ii) payment of only a part of the Payment so that the Eligible Employee receives the largest payment possible without the imposition of the Excise Tax (a “ Reduced Payment ”), whichever amount results in the Participant ’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax.  For purposes of determining whether to make a Full Payment or a Reduced Payment, the Company shall cause to be taken into account all applicable federal, state and local income and employment taxes and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes).  If a Reduced Payment is made, (i) the Payment shall be paid only to the extent permitted under the Reduced Payment alternative, and the Eligible Employee shall have no rights to any additional payments and/or benefits constituting the Payment, and (ii) reduction in payments and/or benefits shall occur in the following order: (1) reduction of cash payments; (2) cancellation of accelerated vesting of equity awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction of other benefits paid to the Eligible Employee.  In the event that acceleration of compensation from the Eligible Employee’s equity awards is to be reduced, such acceleration of vesting shall be canceled in the reverse order of the date of grant.

 

5.


The independent professional firm engaged by the Company for general tax audit purposes as of the day prior to the effective date of the Change of Control shall make all determinations required to be made under this Section 4(b).  If the firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting the Change of Control, the Company shall appoint a nationally recognized independent professional firm to make the determinations required hereunder.  The Company shall bear all expenses with respect to the determinations by such firm required to be made hereunder.

 

The firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and the Eligible Employee within fifteen (15) calendar days after the date on which the Eligible Employee’s right to a Payment is triggered (if requested at that time by the Company or the Eligible Employee) or such other time as requested by the Company or the Eligible Employee.  If the firm determines that no Excise Tax is payable with respect to a Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and the Eligible Employee with an opinion reasonably acceptable to the Eligible Employee that no Excise Tax will be imposed with respect to such Payment.  Any good faith determinations of the firm made hereunder shall be final, binding and conclusive upon the Company and the Eligible Employee.

 

(c)       Code Section 409A.   If the Company (or, if applicable, the successor entity thereto) determines that the severance payments and benefits provided under the Plan (the “ Plan Payments ”) constitute “deferred compensation” under Code Section 409A (together, with any state law of similar effect, “ Section 409A ”) and an Eligible Employee is a “specified employee” of the Company or any successor entity thereto, as such term is defined in Section 409A(a)(2)(B)(i) (a “ Specified Employee ”) on his or her separation from service, then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A, the timing of the Plan Payments shall be delayed as follows:  on the earlier to occur of (i) the date that is six months and one day after the date of his or her separation from service or (ii) the date of the Eligible Employee’s death (such earlier date, the “ Delayed Initial Payment Date ”), the Company (or the successor entity thereto, as applicable) shall (A) pay to the Eligible Employee a lump sum amount equal to the sum of the Plan Payments that the Eligible Employee would otherwise have received through the Delayed Initial Payment Date (including reimbursement for any premiums paid by the Eligible Employee for health insurance coverage under COBRA) if the commencement of the payment of the Plan Payments had not been delayed pursuant to this Section 4(c) and (B) commence paying the balance of the Plan Payments in accordance with the applicable payment schedules set forth in Section 3 above.  It is intended that (i) each installment of the Plan Payments provided under this Plan is a separate “payment” for purposes of Section 409A, (ii) all of the Plan Payments satisfy, to the greatest extent possible, the exemptions from the application of Section 409A provided under of Treasury Regulation 1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9), and this Plan will be construed to the greatest extent possible as consistent with those provisions.

 

6.


Section 5.       REEMPLOYMENT.

 

In the event of an Eligible Employee’s reemployment by the Company during the period of time in respect of which Plan Payments have been paid, the Company, in its sole discretion, may require such Eligible Employee to repay to the Company all or a portion of such Plan Payments as a condition of reemployment.

 

Section 6.       RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION.

 

(a)       Exclusive Discretion.   The Plan Administrator (set forth in Section 11(d)) shall have the exclusive discretion and authority to establish rules, forms, and procedures for the administration of the Plan and to construe and interpret the Plan and to decide any and all questions of fact, interpretation, definition, computation or administration arising in connection with the operation of the Plan, including, but not limited to, the eligibility to participate in the Plan and amount of benefits paid under the Plan.  The rules, interpretations, computations and other actions of the Plan Administrator shall be binding and conclusive on all persons.

 

(b)       Amendment or Termination.   The Company reserves the right to amend or terminate this Plan (including Appendix A) or the benefits provided hereunder at any time prior to a Change of Control; provided, however, that no such amendment or termination shall affect the right to any unpaid benefit of any Eligible Employee whose termination date has occurred prior to amendment or termination of the Plan.  Any purported amendment or termination of this Plan (and the exhibits and appendices heret


 
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