Exhibit 10.3
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT
AGREEMENT by and between Art Technology Group, Inc., a Delaware
corporation (the “Company”), and Robert D. Burke (the
“Executive”) is made as of April 14, 2008 (the
“Effective Date”).
WHEREAS, the Company and the
Executive entered into a letter agreement of employment dated
December 4, 2002, which was amended by a letter agreement
dated March 28, 2003 (together, the “Initial
Agreement”);
WHEREAS, the Company and the
Executive amended and restated the Executive’s Initial
Agreement as of November 8, 2004 (the “Prior
Agreement”);
WHEREAS, the Company recognizes that,
as is the case with many publicly-held corporations, the
possibility of a change in control of the Company exists and that
such possibility, and the uncertainty and questions which it may
raise among key personnel, may result in the departure or
distraction of key personnel to the detriment of the Company and
its stockholders;
WHEREAS, the Board of Directors of
the Company (the “Board”) has determined that
appropriate steps should be taken to reinforce and encourage the
continued employment and dedication of the Company’s key
personnel without distraction from the possibility of a change in
control of the Company and related events and circumstances;
and
WHEREAS, the Company and the
Executive desire to amend and restate the Executive’s
employment agreement to include, among other provisions, certain
additional change in control protections for the Executive.
NOW, THEREFORE, in consideration of
the Executive remaining in the Company’s employ and other
good consideration, the receipt and sufficiency of which is
acknowledged by both parties, the Company and the Executive agree
as follows:
1. Key Definitions.
As used
herein, the following terms shall have the following respective
meanings:
1.1
“Change in Control” means an event or occurrence set
forth in any one or more of subsections (a) through
(d) below (including an event or occurrence that constitutes a
Change in Control under one of such subsections but is specifically
exempted from another such subsection):
(a)
the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”))
(a “Person”) of beneficial ownership of any capital
stock of the Company if, after such acquisition, such Person
beneficially owns (within the meaning of Rule 13d-3
promulgated under the Exchange Act) 50% or more of either
(i) the then-outstanding shares of
common
stock of the Company (the “Outstanding Company Common
Stock”) or (ii) the combined voting power of the
then-outstanding securities of the Company entitled to vote
generally in the election of directors (the “Outstanding
Company Voting Securities”); or
(b) such
time as the Continuing Directors (as defined below) do not
constitute a majority of the Board (or, if applicable, the Board of
Directors of a successor corporation to the Company), where the
term “Continuing Director” means at any date a member
of the Board (i) who was a member of the Board on the date of
the execution of this Agreement or (ii) who was nominated or
elected subsequent to such date by at least a majority of the
directors who were Continuing Directors at the time of such
nomination or election or whose election to the Board was
recommended or endorsed by at least a majority of the directors who
were Continuing Directors at the time of such nomination or
election; or
(c) the
consummation of a merger, consolidation, reorganization,
recapitalization or statutory share exchange involving the Company
or a sale or other disposition of all or substantially all of the
assets of the Company in one or a series of transactions (a
“Business Combination”), unless, immediately following
such Business Combination, each of the following two conditions is
satisfied: (i) all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company
Common Stock and Outstanding Company Voting Securities immediately
prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of Outstanding Company Common Stock and
the combined voting power of the then-outstanding securities
entitled to vote generally in the election of directors,
respectively, of the resulting or acquiring corporation in such
Business Combination (which shall include, without limitation, a
corporation which as a result of such transaction owns the Company
or substantially all of the Company’s assets either directly
or through one or more subsidiaries) (such resulting or acquiring
corporation is referred to herein as the “Acquiring
Corporation”) in substantially the same proportions as their
ownership, immediately prior to such Business Combination, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, respectively; and (ii) no Person (excluding the
Acquiring Corporation or any employee benefit plan (or related
trust) maintained or sponsored by the Company or by the Acquiring
Corporation) beneficially owns, directly or indirectly, 30% or more
of the then outstanding shares of common stock of the Acquiring
Corporation, or of the combined voting power of the
then-outstanding securities of such corporation entitled to vote
generally in the election of directors (except to the extent that
such ownership existed prior to the Business Combination); or
(d) the
approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.
1.2
“Change in Control Date” means the first date during
the Employment Term (as defined in Section 3 of the Agreement)
on which a Change in Control occurs. Anything in this Agreement to
the contrary notwithstanding, if (a) a Change in Control
occurs, (b) the Executive’s employment with the Company
is terminated prior to the date on which the Change in Control
occurs, and (c) it is reasonably demonstrated by the Executive
that such termination of employment (i) was at the request of
a third party who has taken steps reasonably calculated to effect a
Change in Control or (ii) otherwise arose in connection with or in
anticipation of a
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Change
in Control, then for all purposes of this Agreement the
“Change in Control Date” shall mean the date
immediately prior to the date of such termination of
employment.
1.3
“Cause” means:
(a) the
Executive’s willful and continued failure to substantially
perform his reasonable assigned duties as an officer of the Company
(other than any such failure resulting from incapacity due to
physical or mental illness or any failure after the Executive gives
notice of termination for Good Reason), which failure is not cured
within 30 days after a written demand for substantial
performance is received by the Executive from the Board which
specifically identifies the manner in which the Board believes the
Executive has not substantially performed the Executive’s
duties; or
(b) the
Executive’s commission of a felony (other than through
vicarious liability or involving vehicular offense) which is
materially and demonstrably injurious to the Company or a crime
involving fraud or embezzlement against the Company.
For purposes of this
Section 1.3, no act or failure to act by the Executive shall
be considered “willful” unless it is done, or omitted
to be done, in bad faith and without reasonable belief that the
Executive’s action or omission was in the best interests of
the Company.
1.4
“Good Reason” means the occurrence, without the
Executive’s written consent, of any of the events or
circumstances set forth in clauses (a) through
(j) below.
(a) a
change in the Executive’s titles of President and Chief
Executive Officer or the assignment to the Executive of duties
inconsistent in any material respect with the Executive’s
positions (including status, offices, titles and reporting
requirements), authority or responsibilities, or any other action
or omission by the Company which results in a material diminution
in such positions, authority or responsibilities;
(b) a
reduction in any aspect of the Executive’s compensation as
then may be in effect;
(c) the
failure by the Company to (i) continue in effect any material
compensation or benefit plan or program consistent with those
afforded to other senior executives of the Company (including
without limitation any life insurance, medical, health and accident
or disability plan and any vacation or automobile program or
policy) in which the Executive participates or which is applicable
to the Executive, (ii) continue the Executive’s
participation therein (or in such substitute or alternative plan)
on a basis not materially less favorable, both in terms of the
amount of benefits provided and the level of the Executive’s
participation relative to other participants, than the basis
existing immediately prior to the change, or (iii) award cash
bonuses to the Executive in amounts and in a manner substantially
consistent with past practice in light of the Company’s
financial performance;
(d)
any alteration in the Company’s 1996 Amended and Restated
Stock Option Plan in any manner that may exert an adverse impact on
the Executive for the grant of restricted stock awards, restricted
stock units or options to purchase shares of common stock of
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the
Company (the “Common Stock”) granted to the Executive
(the “Stock Awards”) as of the date of this
Agreement;
(e) a
change by the Company in the location at which the Executive
performs his principal duties for the Company to a new location
that is both (i) outside a radius of 35 miles from the
Executive’s principal residence immediately prior to that
change and (ii) more than 20 miles from the location at which
the Executive performed his principal duties for the Company
immediately prior to the change;
(f) a
material breach of this Agreement by the Company;
(g) a
requirement by the Company that the Executive travel on Company
business to a substantially greater extent than required
immediately prior to a Change in Control;
(h) the
failure of the Company to obtain the agreement from any successor
to the Company to assume and agree to perform this Agreement, as
required by Section 7.1;
(i) if,
as a result of a Change of Control, the Company no longer has a
publicly traded class of equity securities and/or is no longer
subject to reporting requirements under the Securities Exchange Act
of 1934; or
(j) any
failure of the Company to pay or provide to the Executive any
portion of the Executive’s compensation or benefits due under
any Company employee benefit plan within seven days of the date
such compensation or benefits are due.
For purposes of this Agreement, any
good faith determination of “Good Reason” made by the
Executive shall be conclusive, binding and final. The
Executive’s right to terminate his employment for Good Reason
shall not be affected by his incapacity due to physical or mental
illness.
1.5
“Disability” means the Executive’s absence from
the full-time performance of the Executive’s duties with the
Company for 180 consecutive calendar days as a result of incapacity
due to mental or physical illness which is determined to be total
and permanent by a physician selected by the Company or its
insurers.
2. Position and Duties. The
Executive will serve as President and Chief Executive Officer of
the Company. The Executive will render such business and
professional services in the performance of the Executive’s
duties consistent with the Executive’s position within the
Company and as reasonably assigned to the Executive by the Board.
During the Employment Term, the Executive will serve as a member of
the Board.
3. Employment Term. This Agreement,
and all rights and obligations of the parties hereunder, shall take
effect upon the Effective Date and shall continue in effect until
the Date of Termination (as defined below) (the “Employment
Term”). The Executive or the Company may terminate
Executive’s employment at any time, with or without Cause,
subject to the severance obligations described in Section 5.2
of the Agreement, except that the Company or Executive
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shall
communicate such termination by a written notice to the other party
hereto (the “Notice of Termination”), given in
accordance with Section 8 of the Agreement. Any Notice of
Termination shall: (a) indicate the specific termination
provision (if any) of this Agreement relied upon by the party
giving such notice; (b) to the extent applicable, set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive’s employment under the
provision so indicated; and (c) specify the Date of
Termination. The effective date of an employment termination (the
“Date of Termination”) shall be the close of business
on the date specified in the Notice of Termination (which date may
not be less than 15 days or more than 120 days after the date
of delivery of such Notice of Termination), in the case of a
termination other than one due to the Executive’s death, or
the date of the Executive’s death, as the case may be. In the
event the Company fails to satisfy the requirements of this
Section 3 regarding a Notice of Termination, the purported
termination of the Executive’s employment pursuant to such
Notice of Termination shall not be effective for purposes of this
Agreement. The failure by the Executive o
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