OMNITURE, INC. AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT
Exhibit 10.1
AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT
THIS AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT (this “Agreement”) is made and entered
into by and between Xxxxxxx X. Xxxxxxx (“Employee”) and Omniture, Inc. (the “Company”), effective as
of May 13, 2009 (the “Effective Date”).
RECITALS
1. It is expected that the Company from time to time will consider the possibility of an
acquisition by another company or other change of control. The Board of Directors of the Company
(the “Board”) recognizes that such consideration can be a distraction to Employee and can cause
Employee to consider alternative employment opportunities. The Board has determined that it is in
the best interests of the Company and its stockholders to assure that the Company will have the
continued dedication and objectivity of Employee, notwithstanding the possibility, threat or
occurrence of a Change of Control (as defined herein) of the Company.
2. The Board believes that it is in the best interests of the Company and its stockholders to
provide Employee with an incentive to continue his or her employment and to motivate Employee to
maximize the value of the Company upon a Change of Control for the benefit of its stockholders.
3. The Board believes that it is imperative to provide Employee with certain severance
benefits upon Employee’s termination of employment following a Change of Control. These benefits
will provide Employee with enhanced financial security and incentive and encouragement to remain
with the Company notwithstanding the possibility of a Change of Control.
4. The Company and Employee entered into an Amended and Restated Change of Control Agreement,
dated March 31, 2008 (amending and restating the original Change of Control Agreement between the
parties, dated June 7, 2006), which was later amended by the parties on December 18, 2008 (the
“Previous Agreement”). This Agreement amends and restates the Previous Agreement.
5. Certain capitalized terms used in this Agreement are defined in Section 7 below.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, including the mutual covenants contained
herein, the Company and Employee hereby agree that the Previous Agreement is hereby amended and
restated as follows:
1. Term of Agreement. This Agreement shall terminate upon the date that all of the
obligations of the parties hereto with respect to this Agreement have been satisfied.
2. At-Will Employment. The Company and Employee acknowledge that Employee’s
employment is and shall continue to be at-will, as defined under applicable law, except as may
otherwise be specifically provided under the terms of any written formal employment agreement or
offer letter between the Company and Employee (an “Employment Agreement”). If Employee’s
employment terminates for any reason, including (without limitation) any termination prior to a
Change of Control, Employee shall not be entitled to any payments, benefits, damages, awards or
compensation other than as provided by this Agreement or under his or her Employment Agreement, or
as may otherwise be available in accordance with the Company’s established employee plans.
3. Severance Benefits.
(a) Involuntary Termination other than for Cause, Voluntary Termination for Good Reason or
Death or Disability during the Change of Control Period. If within the period commencing three
(3) months prior to a Change of Control and ending twelve (12) months following a Change of Control
(the “Change of Control Period”), (i) Employee terminates his or her employment with the Company
(or any parent or subsidiary of the Company) for Good Reason (as defined below) or
(ii) the Company
(or any parent or subsidiary of the Company) terminates Employee’s employment for other than Cause
(as defined below), or (iii) Employee dies or terminates employment due to becoming Disabled (as
defined below) and Employee, except in the case of death, signs and does not revoke a standard
release of claims with the Company in the form attached hereto as Exhibit A (the
“Release”), then Employee shall receive the following severance from the Company:
(i) Severance Payment. Employee shall be entitled to receive a lump-sum severance
payment (less applicable withholding taxes) equal to one hundred percent (100%) of Employee’s
annual base salary (as in effect immediately prior to (A) the Change of Control or (B) Employee’s
termination, whichever is greater) plus an amount equal to Employee’s average annual bonus for the
two (2) fiscal years prior to the fiscal year in which the Change of Control or Employee’s
termination occurs, whichever is greater.
(ii) Equity
Compensation Acceleration. One hundred percent (100%) of the Employee’s
then unvested outstanding stock options, stock appreciation rights, restricted stock units
and other Company equity compensation awards (the “Equity Compensation Awards”) shall immediately
vest and become exercisable. Any Company stock options and stock appreciation rights shall
thereafter remain exercisable following Employee’s employment termination for the period prescribed
in the respective option and stock appreciation right agreements.
(iii) Continued Employee Benefits. Company-paid health, dental, vision, and life
insurance coverage at the same level of coverage as was provided to such Employee immediately prior
to the Change of Control and at the same ratio of Company premium payment to Employee premium
payment as was in effect immediately prior to the Change of Control (the “Company-Paid Coverage”).
If such coverage included Employee’s dependents immediately prior to the Change of Control, such
dependents shall also be covered at Company expense. Company-Paid Coverage shall continue until
the earlier of (i) twelve (12) months from the date of termination, or (ii) the date upon which
Employee and his dependents become covered under another employer’s group health, dental, vision,
long-term disability or life insurance plans that provide Employee and
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his dependents with comparable benefits and levels of coverage. For purposes of Title X of
the Consolidated Budget Reconciliation Act of 1985 (“COBRA”), the date of the “qualifying event”
for Employee and his or her dependents shall be the date upon which the Company-Paid Coverage
terminates.
(b) Release of Claims. The receipt of any severance pursuant to Section 3(a)
above will be subject to Employee signing and not revoking the Release and provided that the
Release becomes effective and irrevocable no later than sixty (60) days following the termination
date (such deadline, the “Release Deadline”). The Company shall provide the Release to Employee
within two (2) business days of termination. If the Release does not become effective by the
Release Deadline, Employee will forfeit any rights to severance payments or benefits under this
Agreement. In no event will severance payments or benefits be paid or provided until the Release
becomes effective and irrevocable.
(c) Voluntary Resignation; Termination for Cause. If Employee’s employment with the
Company terminates (i) voluntarily by Employee other than for Good Reason, or (ii) for Cause by the
Company, then Employee shall not be entitled to receive severance or other benefits except for
those (if any) as may then be established under the Company’s then existing severance and benefits
plans and practices or pursuant to other written agreements with the Company.
(d) Termination Outside of Change of Control Period. In the event Employee’s
employment is terminated for any reason, either prior to the Change of Control Period or after the
Change of Control Period, then Employee shall be entitled to receive severance and any other
benefits only as may then be established under the Company’s existing written severance and
benefits plans and practices or pursuant to other written agreements with the Company.
(e) Internal Revenue Code Section 409A.
(i) Notwithstanding anything to the contrary in this Agreement, no severance pay or benefits
to be paid or provided to Employee, if any, pursuant to this Agreement, when considered together
with any other severance payments or separation benefits that are considered deferred compensation
under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the final
regulations and any guidance promulgated thereunder (“Section 409A”) (together, the “Deferred
Compensation Separation Benefits”) will be paid or otherwise provided until Employee has a
“separation from service” within the meaning of Section 409A.
(ii) Any severance payments or benefits under this Agreement that would be considered Deferred
Compensation Severance Benefits will be paid on, or, in the case of installments, will not commence
until, the sixtieth (60th) day following Employee’s separation from service, or, if
later, such time as required by clause (iii) below. Any installment payments that would have been
made to Employee during the sixty (60) day period immediately following Employee’s separation from
service but for the preceding sentence will be paid to Employee on the sixtieth (60th)
day following Employee’s separation from service and the remaining payments shall be made as
provided in this Agreement. If Employee should die before all amounts have been paid, such unpaid
amounts shall be paid in a lump-sum payment (less any withholding taxes) to
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Employee’s designated beneficiary, if living, or otherwise to the personal representative of
Employee’s estate.
(iii) Notwithstanding anything to the contrary in this Agreement, if Employee is a “specified
employee” within the meaning of Section 409A at the time of Employee’s termination (other than due
to death), then the Deferred Compensation Separation Benefits that are payable within the first six
(6) months following Employee’s separation from service, will become payable on the first payroll
date that occurs on or after the date six (6) months and one (1) day following the date of
Employee’s separation from service. All subsequent Deferred Compensation Separation Benefits, if
any, will be payable in accordance with the payment schedule applicable to each payment or benefit.
Notwithstanding anything herein to the contrary, if Employee dies following Employee’s separation
from service, but prior to the six (6) month anniversary of the separation from service, then any
payments delayed in accordance with this paragraph will be payable in a lump sum as soon as
administratively practicable after the date of Employee’s death and all other Deferred Compensation
Separation Benefits will be payable in accordance with the payment schedule applicable to each
payment or benefit. Each payment and benefit payable under this Agreement is intended to
constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.
(iv) Any amount paid under this Agreement that satisfies the requirements of the “short-term
deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations will not constitute
Deferred Compensation Separation Benefits for purposes of clause (i) above.
(v) Any amount paid under this Agreement that qualifies as a payment made as a result of an
involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury
Regulations that does not exceed the Section 409A Limit will not constitute Deferred Compensation
Separation Benefits for purposes of clause (i) above. For purposes of this Agreement, “Section
409A Limit” will mean the lesser of two (2) times: (i) Employee’s annualized compensation based
upon the annual rate of pay paid to Employee during the Company’s taxable year preceding the
Company’s taxable year of Employee’s termination of employment as determined under Treasury
Regulation 1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect
thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant
to Section 401(a)(17) of the Code for the year in which Employee’s employment is terminated.
(vi) The foregoing provisions are intended to comply with the requirements of Section 409A so
that none of the severance payments and benefits to be provided hereunder will be subject to the
additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so
comply. The Company and Employee agree to work together in good faith to consider amendments to
this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to
avoid imposition of any additional tax or income recognition prior to actual payment to Employee
under Section 409A.
4. Coordination with Existing Agreements. In the event of a termination of Employee’s
employment within the Change of Control Period, the provisions of this Agreement are intended to
enhance, but not be additive, to any pre-existing written agreements between the Company and
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Employee. For example, if Employee’s employment agreement with the Company provides for a
specified cash payment upon a termination without cause, and severance payments are triggered under
both the employment agreement and this Agreement, Employee shall be entitled to the larger cash
payment provided in either agreement but shall not be entitled to the sum of the two cash payments.
The same principle applies to the other individual elements of severance provided herein including
equity compensation award accelerated vesting. Except as otherwise provided in this Section
4, the benefits provided to Employee under this Agreement are intended to be and are exclusive
and in lieu of any other rights or remedies to which Employee or the Company may otherwise be
entitled, whether at law, tort or contract, in equity, and including pursuant to the Company’s
other severance plans, arrangements or practices.
5. Conditional Nature of Severance Payments and Benefits.
(a) Noncompete. Employee acknowledges that the nature of the Company’s business is
such that if Employee were to become employed by, or substantially involved in, the business of a
competitor of the Company during the twelve (12) months following the termination of Employee’s
employment with the Company, it would be very difficult for Employee not to rely on or use the
Company’s trade secrets and confidential information. Thus, to avoid the inevitable disclosure of
the Company’s trade secrets and confidential information, Employee agrees and acknowledges that
Employee’s right to receive the severance payments and benefits set forth in Section 3(a)
above (to the extent Employee is otherwise entitled to such payments) shall be conditioned upon
Employee’s compliance in all respects with any covenant not to compete in effect between Employee
and the Company on the date of this Agreement during the twelve (12) months following the
termination of Employee’s employment with the Company.
(b) Remedy for Breach. Upon any breach by Employee of the covenant not to compete
referred to in Section 5(a) above during the twelve (12) months following the termination
of Employee’s employment with the Company, then, in addition to any other remedy that the Company
may otherwise have, all severance payments and benefits pursuant to this Agreement shall
immediately cease and any stock options or stock appreciation rights then held by Employee shall
immediately terminate and be without further force and effect, and Employee shall be required to
reimburse the Company any lump-sum severance payment previously paid under Section 3(a)(i)
above and the value of any welfare plan reimbursements previously paid under Section
3(a)(iii) above.
6. Golden Parachute Excise Tax.
(a) Parachute Payments of Less than 3.6 x Base Amount. In the event that the benefits
provided for in this Agreement or otherwise payable to Employee, including vesting acceleration
upon a change of control pursuant to Employee’s employment agreement with the Company, if any, (i)
constitute “parachute payments” within the meaning of Section 280G of the Code, (ii) would be
subject to the excise tax imposed by Section 4999 of the Code, and (iii) the aggregate value of
such parachute payments, as determined in accordance with Section 280G of the Code and the Treasury
Regulations promulgated thereunder is less than the product obtained by multiplying three and
six-tenths by Employee’s “base amount” within the meaning of Section 280G(b)(3) of the Code, then
such benefits shall be reduced to the extent necessary (but only to that
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extent) so that no portion of such benefits will be subject to excise tax under Section 4999
of the Code. Any reduction in payments and/or benefits required by this Section 6(a) will
occur in the following order: (i) reduction of cash payments; (ii) reduction of vesting
acceleration of equity awards; and (iii) reduction of other benefits paid or provided to Employee.
In the event that acceleration of vesting of equity awards is to be reduced, such acceleration of
vesting will be cancelled in the reverse order of the date of grant for Employee’s equity awards.
If two or more equity awards are granted on the same date, each award will be reduced on a pro-rata
basis.
(b) Parachute Payments Equal to or Greater than 3.6 x Base Amount. In the event that
the benefits provided for in this Agreement or otherwise payable to Employee, including vesting
acceleration upon a change of control pursuant to Employee’s employment agreement with the Company,
if any, (i) constitute “parachute payments” within the meaning of Section 280G of the Code, (ii)
would be subject to the excise tax imposed by Section 4999 of the Code, and (iii) the aggregate
value of such parachute payments, as determined in accordance with Section 280G of the Code and the
Treasury Regulations promulgated thereunder is equal to or greater than the product obtained by
multiplying three and six-tenths by Employee’s “base amount” within the meaning of Section
280G(b)(3) of the Code, then (A) the benefits shall be delivered in full, and (B) Employee shall
receive (1) a payment from the Company sufficient to pay the excise tax imposed on all parachute
payments except those arising from or related to any Equity Compensation Awards granted to Employee
on or after March 25, 2008, and (2) an additional payment from the Company sufficient to pay the
federal and state income and employment taxes and additional excise taxes arising from the payments
made to Employee by the Company pursuant to this clause (B). For purposes of determining whether a
payment is due to Employee under clause (B) of the previous sentence, any Equity Compensation
Awards granted to Employee on or after March 25, 2008 or any payment or benefit related to any such
award that is considered to be “contingent on change in ownership or control” within the meaning of
Section 280G of the Code will not be considered in determining whether and to what extent the
payments and benefits due to Employee constitute “parachute payments” within the meaning of Section
280G of the Code, but will be considered for other purposes of Section 280G of the Code (for
instance, in determining whether Employee is a “shareholder” under Treasury Regulation Section
1.280G-1 Q/A 15 and 17). Such tax gross up payments, if any, will be paid be no later than the end
of the calendar year immediately following the calendar year in which Employee remits the related
taxes.
(c) 280G Determinations. Unless the Company and Employee otherwise agree in writing,
the determination of Employee’s excise tax liability and the amount required to be paid or reduced
under this Section 6 shall be made in writing by the Company’s independent auditors who are
primarily used by the Company immediately prior to the Change of Control (the “Accountants”). For
purposes of making the calculations required by this Section 6, the Accountants may make
reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable,
good faith interpretations concerning the application of Code Sections 280G and 4999. The Company
and Employee shall furnish to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section 6. The Company
shall bear all costs the Accountants may reasonably incur in connection with any calculations
contemplated by this Section 6.
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7. Definition of Terms. The following terms referred to in this Agreement shall have
the following meanings:
(a) Cause. “Cause” shall mean (i) an act of personal dishonesty taken by Employee in
connection with his responsibilities as an employee and intended to result in substantial personal
enrichment of Employee, (ii) Employee being convicted of, or pleading nolo contendere to a felony,
(iii) a willful act by Employee which constitutes gross misconduct and which is injurious to the
Company, (iv) following delivery to Employee of a written demand for performance from the Company
which describes the basis for the Company’s reasonable belief that Employee has not substantially
performed his duties, continued violations by Employee of Employee’s obligations to the Company
which are demonstrably willful and deliberate on Employee’s part.
(b) Change of Control. “Change of Control” means the occurrence of any of the
following:
(i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing fifty percent (50%) or more of
the total voting power represented by the Company’s then outstanding voting securities; or
(ii) Any action or event occurring within a two-year period, as a result of which fewer than a
majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who
either (A) are directors of the Company as of the date hereof, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of the Incumbent Directors
at the time of such election or nomination (but shall not include an individual whose election or
nomination is in connection with an actual or threatened proxy contest relating to the election of
directors to the Company); or
(iii) The consummation of a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or
(iv) The consummation of the sale, lease or other disposition by the Company of all or
substantially all the Company’s assets.
(c) Disability. “Disability” shall mean that Employee has been unable to perform his
or her Company duties as the result of his incapacity due to physical or mental illness, and such
inability, at least twenty-six (26) weeks after its commencement, is determined to be total and
permanent by a physician selected by the Company or its insurers and acceptable to Employee or
Employee’s legal representative (such Agreement as to acceptability not to be unreasonably
withheld). Termination resulting from Disability may only be effected after at least thirty (30)
days’ written notice by the Company of its intention to terminate Employee’s employment. In the
event
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that Employee resumes the performance of substantially all of his or her duties hereunder
before the termination of his or her employment becomes effective, the notice of intent to
terminate shall automatically be deemed to have been revoked.
(d) Good Reason. “Good Reason” means Employee’s resignation within ninety (90) days
following the expiration of any Company cure period (discussed below) following the occurrence of
one or more of the following, without Employee’s express written consent:
(i) the assignment to Employee of any duties, or the reduction of Employee’s duties, either of
which results in a material diminution of Employee’s authority, duties, or responsibilities with
the Company in effect immediately prior to such assignment, or the removal of Employee from such
position and responsibilities;
(ii) a material reduction of Employee’s base salary as in effect immediately prior to such
reduction; or
(iii) a material change in the geographic location at which Employee must perform services (in
other words, Employee’s relocation to a facility or an office location more than a 35-mile radius
from Employee’s then present location).
Notwithstanding the foregoing, Employee agrees not to resign for Good Reason without first
providing the Company with written notice of the acts or omissions constituting the grounds for
Good Reason within ninety (90) days of the initial existence of the grounds for Good Reason and a
reasonable cure period of thirty (30) days following the date of such notice.
8. Successors.
(a) The Company’s Successors. Any successor to the Company (whether direct or
indirect and whether by purchase, merger, consolidation, liquidation or otherwise) to all or
substantially all of the Company’s business and/or assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement in the same manner
and to the same extent as the Company would be required to perform such obligations in the absence
of a succession. For all purposes under this Agreement, the term “Company” shall include any
successor to the Company’s business and/or assets which executes and delivers the assumption
agreement described in this Section 8(a) or which becomes bound by the terms of this
Agreement by operation of law.
(b) Employee’s Successors. The terms of this Agreement and all rights of Employee
hereunder shall inure to the benefit of, and be enforceable by, Employee’s personal or legal
representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
9. Notice.
(a) General. All notices and other communications required or permitted hereunder
shall be in writing, shall be effective when given, and shall in any event be deemed to be given
upon receipt or, if earlier, (a) five (5) days after deposit with the U.S. Postal Service or other
applicable postal service, if delivered by first class mail, postage prepaid, (b) upon delivery, if
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delivered by hand, (c) one (1) business day after the business day of deposit with Federal
Express or similar overnight courier, freight prepaid or (d) one (1) business day after the
business day of facsimile transmission, if delivered by facsimile transmission with copy by first
class mail, postage prepaid, and shall be addressed (i) if to Employee, at his or her last known
residential address and (ii) if to the Company, at the address of its principal corporate offices
(attention: Secretary), or in any such case at such other address as a party may designate by ten
(10) days’ advance written notice to the other party pursuant to the provisions above.
(b) Notice of Termination. Any termination by the Company for Cause or by Employee
for Good Reason or Disability or as a result of a voluntary resignation shall be communicated by a
notice of termination to the other party hereto given in accordance with Section 9(a)
above. Such notice shall indicate the specific termination provision in this Agreement relied
upon, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis
for termination under the provision so indicated, and shall specify the termination date (which
shall be not more than thirty (30) days after the giving of such notice). The failure by Employee
to include in the notice any fact or circumstance which contributes to a showing of Good Reason or
Disability shall not waive any right of Employee hereunder or preclude Employee from asserting such
fact or circumstance in enforcing his or her rights hereunder.
10. Miscellaneous Provisions.
(a) No Duty to Mitigate. Employee shall not be required to mitigate the amount of any
payment contemplated by this Agreement, nor shall any such payment be reduced by any earnings that
Employee may receive from any other source.
(b) 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 Employee and by
an authorized officer of the Company (other than Employee). 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.
(c) Headings. All captions and section headings used in this Agreement are for
convenient reference only and do not form a part of this Agreement.
(d) Entire Agreement. This Agreement, along with other written agreements relating to
the subject matter hereof between Employee and a duly authorized Company officer constitute the
entire agreement of the parties hereto and supersede in their entirety all prior representations,
understandings, undertakings or agreements (whether oral or written and whether expressed or
implied) of the parties with respect to the subject matter hereof, and, in particular, it replaces
and supersedes the Previous Agreement in its entirety.
(e) Choice of Law. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Utah. The Utah state courts in Utah
County, Utah and/or the United States District Court for the District of Utah in Salt Lake City
shall have exclusive jurisdiction and venue over all controversies in connection with this
Agreement.
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(f) 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.
(g) Withholding. All payments made pursuant to this Agreement will be subject to
withholding of applicable income and employment taxes.
(h) Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original, but all of which together will constitute one and the same instrument.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by its duly authorized officer, to be effective as of the Effective Date.
COMPANY |
OMNITURE, INC. |
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| By: | /s/ Xxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxxxx | |||
| Title: | Chief Legal Officer and Senior Vice President | |||
| EMPLOYEE | By: | /s/ Xxxxxxx X. Xxxxxxx | ||
| Xxxxxxx X. Xxxxxxx | ||||
| Chief Financial Officer and Executive Vice President |
||||
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