CONFIDENTIAL
SEVERANCE AGREEMENT
THIS AGREEMENT is entered into as of , by and
between (the "Executive") and Avant! Corporation, a
Delaware corporation (the "Company").
1. CONSEQUENCES OF CERTAIN TERMINATIONS.
Unless otherwise defined in this section, each capitalized term used in this
Agreement shall have the meaning assigned to it in the Company's 1995 Stock
Option/Stock Issuance Plan in effect on the date of this Agreement (the "PLAN").
Without limiting any other rights which the Executive or the Company may have in
such event, upon any involuntary termination of the Executive's employment
(including but not limited to a Constructive Termination as defined below) that
occurs within six months after a Change in Control (as defined below) (a CHANGE
IN CONTROL TERMINATION), and subject to section 2 below, the Company shall pay
to the Executive a cash termination payment equal to three (3) years of the
Executive's annual base salary in effect (a) on the date of termination or (b)
immediately prior to the Change in Control (whichever is greater), in addition
to any other payments, benefits or other rights to which the Executive may then
be entitled.
For all purposes under this Agreement, "CHANGE IN CONTROL" shall mean the
occurrence of any of the following events after the date of this Agreement:
(a) The consummation of a merger or consolidation of the Company with
or into another entity or any other corporate reorganization, if
more than 50% of the combined voting power of the continuing or
surviving entity's securities outstanding immediately after such
merger, consolidation or other reorganization is owned by persons
who were not stockholders of the Company immediately prior to
such merger, consolidation or other reorganization;
(b) The sale, transfer, exchange or other disposition of all or
substantially all of the Company's assets;
(c) A change in the composition of the Company's Board of Directors
(the "Board") as a result of which fewer than a majority of the
directors are directors who EITHER (A) had been directors of the
Company on the date 24 months prior to the date of the event that
may constitute a Change in Control (the "ORIGINAL DIRECTORS" or
(B) were elected, or nominated for election, to the Board with
the affirmative votes of at least a majority of the aggregate of
the original directors who were still in office at the time of
the election or nomination and the directors whose election or
nomination was previously so approved; or,
(d) Any transaction as a result of which any person is the
"beneficial owner"(as defined in rule 13d-3 under the Securities
Exchange Act of 1934, as amended) (the "EXCHANGE ACT")), directly
or indirectly, of securities of the Company representing at least
50% of the total voting power represented by the Company's then
outstanding voting securities. For purpose of this subsection
(d), the term "person" shall have the same meaning as when used
in sections 13(d) and 14(d) of the Exchange Act but shall exclude
(A) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or of a parent or subsidiary
of the Company and (B) a corporation owned directly or indirectly
by the stockholders of the Company in substantially the same
proportions as their ownership of the common stock of the
Company.
A transaction shall in no event constitute a Change in Control if its sole
purpose is to change the state of the Company's incorporation or to create a
holding company that will be owned in substantially the same proportions by the
persons who held the Company's securities immediately before such transaction.
For all purposes under this Agreement, "CONSTRUCTIVE TERMINATION" shall be
deemed to have occurred, on written notice by Executive to the Company, upon:
(I) any refusal by Executive to relocate the Executive's principal place of
employment to a location requested by the Company that is more than 25 miles
from Executive's current principal place of employment; (ii) any adverse change
in Executive's compensation; (iii) any material adverse change in Executive's
position, job responsibilities or reporting lines; or (iv) any activity by the
Company that constitutes constructive termination of employment under applicable
law. Without limiting the events which may constitute a material adverse change
in the Executive's position, job responsibilities or reporting lines under this
definition, such a material adverse change shall conclusively be deemed to have
occurred upon any material diminution or other material adverse change in the
size or business functions or responsibilities of any Company department or
group of Company employees reporting to Executive at the time of a Change in
Control, or in the extent or nature of Executive's authority with respect to
such functions or responsibilities or the employees who perform them.
2. MISCELLANEOUS PROVISIONS
(a) NO RIGHT TO EMPLOYMENT. Notwithstanding this Agreement, either party
may terminate the Executive's employment at any time and for any reason, or for
no reason, upon written notice to the other party; provided, however, that any
Change in Control Termination shall be subject to all of the consequences
described in section 1 above.
(b) NOTICE. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered mail, return receipt
requested and postage prepaid. In the case of the Executive, mailed notices
shall be addressed to the Executive at the home address shown below on this
Agreement or at the home address which the Executive most recently communicated
to the Company in writing. In the case of the Company, mailed notices shall be
addressed to its corporate headquarters, and all notices shall be addressed to
the attention of its Secretary.
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(c) WAIVER. No provision of this Agreement shall be modified, waived or
discharged unless the modification, waiver or discharge is agreed to in writing
and signed by the Executive and by an authorized officer of the Company (other
than the Executive). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.
(d) WHOLE AGREEMENT; MODIFICATIONS. No agreements, representations or
understanding (whether oral or written and whether express or implied) which are
not expressly set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof. This Agreement contains
the entire understanding of the parties with respect to the subject matter
hereof. A modification of this Agreement shall be valid only if it is made in
writing and executed by both parties hereto.
(e) WITHHOLDING TAXES. All payments made under this Agreement shall be subject
to reduction to reflect taxes or other charges required to be withheld by law.
(f) CHOICE OF LAW. The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of California (except
their provisions governing the choice of law).
(g) SEVERABILITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision hereof, which shall remain in full force and effect.
(h) COMPANY'S SUCCESSORS. This Agreement shall be binding upon any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets. For all purposes under this Agreement, the
term "COMPANY" shall include any successor to the Company's business and/or
assets which becomes bound by this Agreement.
(I) EXECUTIVE'S SUCCESSORS. This Agreement and all right of the Executive
hereunder shall inure to the benefit of, and be enforceable by, the Executive's
personal or legal representatives, executors, heirs, distributees, devisees and
legatees.
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(j) NO ASSIGNMENT. The rights of any person to payments or benefits under this
Agreement shall not be made subject to option or assignment, either by voluntary
or involuntary assignment or by operation of law, including (without limitation)
bankruptcy, garnishment, attachment, or other creditor's process, and any action
in violation of this paragraph shall be void.
(k) COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
(l) CONFIDENTIALITY. The Executive agrees that the Executive will not disclose
the existence or the terms of this Agreement to anyone other than the
Executive's spouse, tax advisor, or legal advisor. In the event the Executive
breaches this confidentiality obligation, this Agreement may be immediately
terminated by the Company.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company, by its duly authorized officer, as of the day and year first
above written,
/s/
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Signature of Executive
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Printed name of Executive
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Executive's Mailing Address
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AVANT! CORPORATION
/s/
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Xxxxxx X. Xxx
Chairman, President, and Chief Executive
Officer
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