Exhibit 10.43
Palm, Inc.
SEVERANCE
AGREEMENT
This Severance Agreement was
previously entered into by and between Palm, Inc. (the
“Company”) and you,
, and is hereby amended and restated effective as of
,
the “Effective Date”). This amended and restated
Severance Agreement shall be referred to as this
“Agreement.” For purposes of this Agreement, the
“Company” shall include any parent or subsidiary of the
Company, unless the context clearly requires otherwise.
This Agreement is intended to
incentivize you to remain with the Company by providing you with
certain severance benefits in the event that your employment with
the Company terminates under certain circumstances. This Agreement
also is intended to provide you with enhanced financial security in
recognition of your past and future service to the
Company.
1. Eligibility for Severance
Benefits . You will be entitled to the payments and benefits
described in Section 2 only if either (i) the Company
terminates your employment for a reason other than Cause, death or
Disability or (ii) you terminate your employment with the
Company pursuant to a Voluntary Termination for Good Reason, and
you
(a) sign and deliver to the Company
a Release of Claims satisfactory to the Company, and
(b) comply with all of the terms of
this Agreement, including (but not limited to) Section 7
regarding Non-Disclosure, Non-Disparagement, Non-Solicitation and
Other Continuing Obligations;
provided, however, that in the event
you are employed by a subsidiary of the Company that is involved in
a Spin-Off (as defined in Section 8), then you shall not be
deemed to have been terminated for Cause and you shall not be
permitted to terminate pursuant to a Voluntary Termination for Good
Reason and receive the benefits described hereunder on account of
the Spin-Off, but rather such subsidiary shall be deemed to be a
successor of the Company (as determined under Section 8) and
this Agreement shall inure to the benefit of the parties described
in Section 8.
Notwithstanding the preceding, if
your termination of employment would qualify you for payments and
benefits under your Management Retention Agreement with the Company
dated as of even date herewith, you will receive neither the
payments nor the benefits described in Section 2. Instead, you
will receive the payments and benefits to which you are entitled
under your Management Retention Agreement.
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2. Severance Benefits . If
you meet the eligibility requirements described in Section 1,
you will receive the following:
(a) Cash Payments . You will
receive a cash payment equal to one hundred percent (100%) of
your annual base salary in effect immediately prior to the date of
your termination of employment (the “Termination Date”)
(or, in the case of a Voluntary Termination for Good Reason
pursuant to Section 4(c)(ii) of this Agreement, your annual
base salary in effect immediately prior to the reduction that
resulted in such Good Reason), less such deductions and
withholdings required by law or authorized by you. This payment
will be made in a lump sum on the Termination Date; provided,
however, to the extent provided under Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”),
if such payment exceeds the lesser of (i) two (2) times
the sum of your “annualized compensation” (as such term
is used in the regulations to Code Section 409A) based on the
annual rate of pay for services you provided to the Company for the
taxable year or (ii) two (2) times the maximum amount
that may be taken into account under a qualified plan pursuant to
Code Section 401(a)(17), then you will receive a lump sum
payment equal to the limit imposed by Section 409A (under
(i) or (ii) above, as applicable) on the Termination
Date. The sum in excess of the limit imposed by Section 409A
will be paid in a lump sum promptly following the six
(6) month anniversary of the Termination Date.
(b) Equity Award Vesting .
Except as expressly addressed in Sections 2(c) and 2(d) below, any
shares covered by Company equity awards, whether granted to you
before, on or after the Effective Date that are unvested and
unexpired on the Termination Date, except for equity awards that
vest with a contingency based on the achievement of a performance
objective or objectives or that have their vesting accelerate upon
the achievement of a performance objective or objectives, will
become vested and exercisable on the Termination Date if the shares
otherwise would have vested (solely by virtue of your continued
employment with the Company and not, directly or indirectly, due to
a Change of Control of the Company as defined in your Management
Retention Agreement) during the one-year (1-year) period commencing
on the Termination Date. Any equity awards that vest based on a
combination of one or more performance objectives all of which have
been met as of the Termination Date and a time-based vesting
schedule will be treated for purposes of this paragraph as if they
vested solely on a time-based vesting schedule. Any other unvested
equity awards will be forfeited on the Termination Date.
(c) Lapse of Restrictions on
Restricted Stock . Fifty percent (50%) of any shares of
stock that you have purchased from the Company that remain subject
to a right of repurchase on the Termination Date will vest on the
Termination Date and the Company’s right of repurchase will
terminate on that date, except for shares that vest and for which
the Company’s right of repurchase terminates with a
contingency based on the achievement of a performance objective or
objectives or that have their vesting accelerate and for which the
Company’s right of repurchase terminates upon the achievement
of a performance objective or objectives. Any shares of stock that
have a right of repurchase that lapses based on a combination of
one or more performance objectives all of which have been met as of
the Termination Date and a time-based vesting schedule will be
treated for purposes of this paragraph as if they vested solely on
a time-based vesting schedule.
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(d) Acceleration of Restricted
Stock Units . Fifty percent (50%) of any unvested
restricted stock units (also known as performance shares) with
respect to Company stock that are unvested and unexpired on the
Termination Date will vest and be paid on the Termination Date,
except for restricted stock units that vest with a contingency
based on the achievement of a performance objective or objectives
or that have their vesting accelerate upon the achievement of a
performance objective or objectives. Any restricted stock units
that vest based on a combination of one or more performance
objectives all of which have been met as of the Termination Date
and a time-based vesting schedule will be treated for purposes of
this paragraph as if they vested solely on a time-based vesting
schedule.
(e) Other Benefits . The
Company will provide you with medical, dental and vision benefits
coverage during the one-year (1-year) period beginning on the
Termination Date, but only if you elect continuation coverage under
the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”), within the time period prescribed
pursuant to COBRA. For the duration of the one-year (1-year)
period, the Company will pay the COBRA premiums otherwise payable
by you (and your eligible dependents). After the one-year (1-year)
period, you will be responsible for the payment of any COBRA
premiums. The Company will not reimburse you for any taxable income
imputed to you because the Company has paid your COBRA premiums (or
those of your eligible dependents).
(f) Accrued Wages and Paid Time
Off; Expenses . The Company will pay you: (i) any unpaid
base salary due for periods prior to the Termination Date,
(ii) all of your accrued and unused paid time off
(“PTO”) through the Termination Date, and
(iii) following your submission of proper expense reports, the
total unreimbursed amount of all expenses incurred by you in your
duties of employment with the Company that are reimbursable in
accordance with the Company’s then-existing policies. These
payments will be made promptly upon your employment termination and
within the period of time mandated by law.
3. Other Terminations of
Employment . If your employment with the Company is terminated
by the Company for Cause, death or Disability, or if you
voluntarily terminate your employment other than pursuant to a
Voluntary Termination for Good Reason, you will not be entitled to
receive any of the payments or benefits described in Section 2
of this Agreement. However, you may be eligible for benefits as may
separately be provided under another of the Company’s
severance and benefit plans and policies on the Termination Date.
In addition, the Company will pay you: (i) any unpaid base
salary due for periods prior to the Termination Date, (ii) all
of your accrued and unused PTO through the Termination Date, and
(iii) following your submission of proper expense reports, the
total unreimbursed amount of all expenses incurred by you in your
duties of employment with the Company that are reimbursable in
accordance with the Company’s then-existing policies. These
payments will be made promptly upon your employment termination and
within the period of time mandated by law.
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4. Definition of Terms . The
following terms used in this Agreement shall have the following
meanings:
(a) Cause .
“Cause” means: (i) your willful dishonesty or
fraud with respect to the business affairs of the Company;
(ii) your intentional falsification of any employment or
Company records; (iii) your misappropriation of or intentional
damage to the business or property of the Company, including (but
not limited to) the improper use or disclosure of the confidential
or proprietary information of the Company (excluding
misappropriation or damage that results in a loss of little or no
consequence to the business or property of the Company);
(iv) your conviction (including any plea of guilty or nolo
contendere) of a felony that, in the judgment of the Board of
Directors of Palm, Inc. (the “Board”) (excluding you)
or its Compensation Committee, materially impairs your ability to
perform your duties for the Company or adversely affects the
Company’s reputation or standing in the community; or
(v) your refusal to perform any assigned duties reasonably
expected of a person in your position after your receipt of written
notice by the Chief Executive Officer or Executive Chairman of
Palm, Inc. of such refusal and a reasonable opportunity to cure (as
described below).
You shall be given written notice by
the Company of its intention to terminate you for Cause, which
notice (i) shall state with particularity the grounds on which
the proposed termination for Cause is based and (ii) shall be
given no later than ninety (90) days after the occurrence of
the event giving rise to such grounds (or ninety (90) days
after such later date as represents the actual knowledge by an
executive officer of Palm, Inc. (excluding you) of such grounds).
The termination shall be effective upon your receipt of such
notice; provided, however, that with respect to subsection
(v) hereof, you shall have thirty (30) days after
receiving such notice in which to cure any refusal to perform (to
the extent such cure is possible). If you fail to cure such failure
to perform within such thirty-day (30-day) period, your employment
with the Company shall thereupon be terminated for
Cause.
(b) Disability .
“Disability” means that you have been unable to perform
your duties as an employee of the Company a
