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SEPARATION AGREEMENT
THIS SEPARATION AGREEMENT
is made and entered into as of the 8th day of April, 2008
(“Effective Date”) by and between CONCURRENT
COMPUTER CORPORATION, a Delaware corporation
(“Concurrent”), and T. GARY TRIMM
(“Trimm”).
W
I T N E S S E T H :
WHEREAS, Trimm and
Concurrent entered into an Employment Agreement on June 24,
2004 and such agreement was amended on August 8, 2006
(“Employment Agreement”);
WHEREAS, upon a voluntary
termination by Trimm under the Employment Agreement, he is
entitled to continue to receive his salary and any accrued
and due bonus payments under the Employment Agreement only
through the date of his voluntary termination and any other
rights and benefits he may be entitled to under
Concurrent’s employee benefit plans as of such
date;
WHEREAS, Trimm for personal
reasons desires to resign from his position as Chief
Executive Officer and as a member of Concurrent’s Board
of Directors but has agreed to a flexible timetable pending
the search for a new Chief Executive Officer and to assist in
the transition to a new Chief Executive Officer;
WHEREAS, Concurrent’s
Board of Directors desires to provide Trimm with a transition
package so that he can transition his position and develop
and execute a communication plan to his direct reports and
others to maintain continuity and momentum for Concurrent
during the transition period; and
WHEREAS, Concurrent and
Trimm acknowledge and agree that (except as previously
stated) Trimm is not entitled to compensation and benefits
under his Employment Agreement when he voluntarily resigns as
Chief Executive Officer and that the compensation and
benefits payable under this Separation Agreement is
compensation and benefits which Trimm is not otherwise
entitled to receive under his Employment
Agreement;
WHEREAS, Concurrent and
Trimm desire for Trimm to execute a release of
claims;
NOW, THEREFORE, in
consideration of the premises and mutual covenants contained
herein and for other good and valuable consideration,
Concurrent and Trimm agree as follows:
1. Effective
immediately upon a new Chief Executive Officer assuming his
duties (the “Resignation Date”), Trimm hereby
resigns his position as Chief Executive Officer (and any
other positions he currently holds with Concurrent and its
affiliates) and as a member of Concurrent’s Board of
Directors, Trimm will remain an employee (but not an officer)
of Concurrent until the close of business on May 2, 2008 at
the rate of salary in effect on the Effective Date, at which
time he will incur a separation from service from Concurrent
within the meaning of Internal Revenue Code
(“Code”) § 409A.
2. Upon
Trimm’s separation from service, Trimm’s
compensation and benefits shall be as set forth in this
Separation Agreement and shall be payable to Trimm
conditioned upon (i) Trimm’s full and complete
compliance with the terms of this Agreement, including those
obligations set forth in paragraphs 8, 9, and 11, and
(ii) Trimm’s execution of and compliance with a
Full and Final Release of Claims in substantially the same
form as set forth in Exhibit A to this Agreement (regardless
of whether such terms are otherwise deemed enforceable) after
May 2, 2008 and before May 22, 2008.
3. Immediately
following his separation from service, Trimm will serve as a
consultant to Concurrent and in his role as a consultant will
be available to the new Chief Executive Officer and the Board
of Directors to consult on technical matters, customer
relations, employee relations, strategic issues or any other
matters pertinent to the success of Concurrent when requested
by the new Chief Executive Officer and the Board of
Directors.
(i) As
a consultant, Trimm will be paid a retainer fee of $10,000 per
calendar month (less applicable withholding) on the last day
of each calendar month for twelve (12) months beginning in May
2008 and ending in April 2009
(ii) Beginning
in May 2009, Trimm will be entitled to a monthly retainer fee
of $5,000 per calendar month (less applicable withholding)
payable on the last day of each calendar month for eighteen
(18) months and the last such payment shall be made on October
31, 2010.
(iii) If
Trimm dies before all retainer payments under this
§ 3 have been paid, any remaining retainer payments
shall continue to be made to Trimm’s estate at such time
and in the same amounts as such payments would have been paid
to Trimm had he survived.
4. Any
amounts owed to Trimm under the Concurrent annual incentive
plan for Concurrent’s 2008 fiscal year (ending June 30,
2008) will be calculated as of the end of such fiscal year
and will be prorated based on the number of days Trimm served
as Chief Executive Officer during the 2008 fiscal
year. Such amount (less applicable withholding)
will be paid to Trimm at the same time as payments are made
to employees of Concurrent and no later than August 31,
2008.
5. Except
as described in this §5, Concurrent will continue
coverage for Trimm and his eligible dependents under the
Concurrent hospitalization and medical plan during the period
beginning on the date Trimm separates from service and
continuing through the date Trimm reaches age 65
(“Coverage Period”). In order to obtain
the coverage, Trimm must pay the employee premium that would
be Trimm’s responsibility if he was still
employed. However, Concurrent and Trimm recognize
that under certain situations Concurrent may not be able to
provide coverage under the Concurrent hospitalization and
medical plan to Trimm and his eligible dependents for the
entire Coverage Period. To the extent Concurrent
cannot provide such coverage, Concurrent will assist Trimm in
obtaining coverage under other plans or arrangements wherein
Concurrent can obtain group rates or other financial
advantages for Trimm. To the extent such other
coverage is not available, Concurrent will (in full
satisfaction of its obligations under this §5) pay the
Economic Equivalent in cash to Trimm on the first day of each
calendar month during the Coverage Period for which such
coverage is not available. For purposes of this
paragraph, “Economic Equivalent” shall mean the
cost to Concurrent (determined at the time Concurrent ceases
to cover Trimm under the Concurrent hospitalization and
medical plan) for coverage under such plan for an employee
covered under such plan (reduced by the amount which is the
employee’s responsibility in accordance with the
applicable plan document). The amount paid to Trimm
as the Economic Equivalent will be “grossed-up”
(that is, Trimm will be paid any additional amount necessary
to make Trimm whole for additional income taxes, if any,
incurred by Trimm on cash amounts paid to him pursuant to this
paragraph).
6. As
of the Effective Date, Trimm has only the stock options and
restricted stock awards listed on Exhibit B to this Separation
Agreement (“Awards”). Notwithstanding
any contrary provision of an Award, each Award hereby is
amended as follows effective as of the Resignation
Date:
a. To
the extent the Award is not fully vested or restrictions have
not lapsed as of the Resignation Date, Trimm will continue to
vest and restrictions will lapse in accordance with the
schedule for such Award set forth in Exhibit B while he
continues to serve as a consultant for Concurrent, and such
Award will fully vest or restrictions will fully lapse on the
earliest of (i) the date for vesting or lapse of restrictions
in the applicable schedule set forth in Exhibit B, (ii) the
date of a change in control (as defined in the Concurrent
Computer Corporation Second Amended and Restated 2001 Stock
Option Plan) or (iii) October 31, 2010; provided Trimm
continues to perform services as a consultant through the
applicable date.
b. Each
Award which is a stock option shall be exercisable by Trimm
(or upon his death, by the person designated to exercise such
stock option Award after death under the applicable plan
document) until the earlier of (i) February 28, 2011, (ii) the
date the Award would otherwise cease to be exercisable by its
terms (as determined without regard to Trimm’s
separation from service) or (iii) the date which is 180 days
after Trimm’s death.
Except
for the vesting, lapse of restrictions and exercise period
changes as set forth in this § 6, each such Award
shall remain in full force and effect in accordance with its
terms as in effect before the Resignation Date.
7. Trimm
shall be reimbursed by Concurrent for any out of pocket
expenses he incurs while performing services as a consultant,
provided such reimbursements are made by Concurrent in
accordance with Concurrent’s standard expense
reimbursement policy for Concurrent’s employees, but in
no event shall any cost or expense be reimbursable to Trimm
after the end of the calendar year immediately following the
calendar year in which he incurs such cost or expense even if
reimbursement was permissible at a later date under
Concurrent’s policy. The expenses paid by
Concurrent during any taxable year of Trimm will not affect
the expenses paid by Concurrent in another taxable
year. This right to reimbursement is not subject to
liquidation or exchange for another benefit.
8. Trimm
agrees that during his employment and for the period
beginning on the date of his resignation from employment
through October 31, 2010, he shall not:
a. engage
in or provide any services in a senior managerial capacity to
or on behalf of any person or entity that competes with
Concurrent in the “real time” or
“video-on-demand” businesses anywhere in the
continental United States, which Trimm agrees is the primary
geographic area in which Concurrent competes in these
businesses and thus, by virtue of his responsibilities and
position as a senior executive with Concurrent;
b. solicit
or attempt to solicit, for the purpose of competing with
Concurrent in its “real time” or
“video-on-demand” businesses, any customers or
active prospects of Concurrent with whom Trimm had any
material business contact during the final twelve months of
his employment and during his service as a consultant;
or
c. recruit
or otherwise seek to induce any employees of Concurrent to
terminate their employment or violate any agreement with
Concurrent.
9. Trimm
agrees that he will not use for his own benefit nor reveal to
any person or entity any of the trade’s secrets of
Concurrent for so long as they remain trade
secrets. Trade secrets shall be defined as set
forth in the Georgia Trade Secrets Act. Trimm
further agrees that during the period of his employment, his
engagement as a consultant, and for a period of three years
following his engagement as a cons
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