SEPARATION AGREEMENT
Exhibit
10.1
| January 3, 2007 |
Xx.
Xxxxxxxx Xxxxx
[Intentionally
omitted]
Dear
Narendra:
In
consideration for your long-term contributions to NetScout Systems, Inc.
(“NetScout”) and in connection with the termination of your employment
contemplated herein, this letter agreement outlines and confirms the terms
and
conditions of severance and other benefits being offered to you as a result
of
your separation from employment with NetScout.
1. Termination.
Your employment with NetScout will terminate as of 5:00 p.m. on January 19,
2007
(the “Separation Date”).
2. Advisor
to CEO.
Until the third anniversary of the date hereof, you will act as advisor to
the
current CEO of NetScout, Xxxx Xxxxxxx, at reasonable times by telephone or
in
person by mutual agreement, to respond to inquiries regarding matters in which
you were involved during your employment with NetScout. Your role as an advisor
shall immediately terminate if NetScout is sold, whether by merger, sale of
assets or otherwise, or if Xxxx Xxxxxxx ceases to serve as the CEO of
NetScout.
3. Severance
Payments and Benefits.
Until the day that you turn 65 years of age, provided that you (a) sign this
Agreement and (b) comply with the provisions of this Agreement (subject to
Section 12(a) below), NetScout will provide you with the following payments
and
benefits:
a) Severance.
NetScout will pay you severance of $16,208 per month, minus any withholdings
as
required by law. Such payments will be paid concurrently with NetScout’s
ordinary payroll, but no less than monthly. This severance will be paid to
you
no later than the 15th
day of each calendar month beginning on the month following your Separation
Date. In order to provide for a cost of living increase with respect to certain
benefits to be borne by you that the monthly payments under this Section 3(a)
are intended to cover, $4,443 of such monthly
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Xxxxxxxx Xxxxx
January
3, 2007
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2
payments will be adjusted on January 1, 2008 and, with respect to such adjusted amount, on January 1 of each following calendar year in which NetScout is required to make such payments by the percentage change in the Consumer Price Index (CPI-U), U.S. City Average, all items, published by the United States Bureau of Labor Statistics, during the immediately preceding calendar year. The foregoing notwithstanding, any adjustment due to the percentage change in the CPI-U shall not decrease any payments to be made pursuant to this Section.
b) Benefits.
NetScout will either (a) continue your coverage under NetScout’s group health,
dental and vision plans at no expense to you or (b) will pay for you to obtain
similar and comparable benefits.
c) Executive
Assistant and Office Space.
During the period in which you are providing advisory services under this
Agreement, NetScout will provide you with office space and provide you with
access to an executive assistant.
d) Section
409A Prohibited Payments.
In order to comply with Section 409A of the Internal Revenue Code of 1986,
as
amended (the “Code”),
for
the period from June 15, 2007 through June 30, 2007, NetScout will not make
any
payments to you that are taxable under the Code, and NetScout will make any
such
payments you were otherwise entitled to during such period under this Agreement
on July 1, 2007.
4. Other
Payments.
a) FY
2007 Bonus.
With respect to the period that you were employed by NetScout during its fiscal
year 2007, you will be eligible to receive a fiscal year 2007 year-end bonus
based on Company performance and other objectives as determined and awarded
by
the Board of Directors, which bonus shall be paid at the same time or times
as
other executive level officers of NetScout, other than from June 15, 2007
through June 30, 2007, but in no event later than December 31,
2007.
b) Vacation.
NetScout will pay you the balance of your vacation days accrued but not yet
taken as of the Separation Date, minus tax withholdings as required by
law.
5. Death
Before Age 65.
In the event that you die before the age of 65, until the date that you would
have turned 65:
a) NetScout
will pay the balance of the severance payments payable under Section 3(a) of
this Agreement to your wife (or in the event of your wife’s death, your estate)
in a lump sum on a net present value basis in a matter mutually agreed by
NetScout and Xx. Xxxxx’x survivors. NetScout will make such lump sum payment (i)
if you die before November 1 of the year of your death, not later than December
31 of such year, provided that NetScout will make such payment within thirty
(30) days after written notice of your death, or the death of your wife, if
such
notice is given prior to November 1 of such year or (ii) if you die on or after
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Xxxxxxxx Xxxxx
January
3, 2007
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3
November 1 of the year of your death, on the earliest date reasonably practicable in the following January.
b) NetScout
will continue to provide your wife and children with group health, dental and
vision benefits at no expense to them, to the extent they are eligible for
coverage under such group plans, or will pay for them to obtain similar and
comparable benefits for as long as they would have been eligible for coverage
if
you had continued to work as an employee of NetScout until you turned 65.
6. Confidential
Information; Return of Company Property.
You agree to treat as strictly confidential all proprietary and other
confidential information of NetScout, and to not at any time, without NetScout’s
prior written consent, reveal or disclose to any person outside of NetScout,
or
use for your own benefit or for the benefit of any other person or entity,
any
confidential information concerning NetScout’s business, clients, or employees.
Confidential information includes, without limitation, financial information,
reports, forecasts, intellectual property, trade secrets, know-how, software,
market or sales information and plans, client lists, business plans, prospects
and opportunities. All documents, records, materials, computers, software,
equipment, office entry keys, credit cards and other physical property, and
all
copies of the same that have come into your possession or been produced by
you
in connection with your employment, have been and remain the sole property
of
NetScout. You agree that you will return all such property to NetScout, or
certify its destruction, no later than the third anniversary of the date
hereof.
7. General
Release of Claims.
In consideration of the promises made in this Agreement, you on behalf of
yourself and your heirs, executors, administrators and assigns, hereby release
and forever discharge NetScout and its parents and affiliates, and each of
their
respective officers, directors, employees, agents, successors and assigns (the
“Released Parties”), from any and all suits, claims, demands, debts, sums of
money, damages, interest, attorneys’ fees, expenses, actions, causes of action,
judgments, accounts, promises, contracts, agreements, and any and all claims
of
law or in equity, whether now known or unknown, which you now have or ever
have
had against the Released Parties, or any of them, including, but not limited
to,
any claims under Title VII of the Civil Rights Act of 1964, the Americans With
Disabilities Act, the Age Discrimination in Employment Act of 1967, the Older
Workers Benefit Protection Act, the Family and Medical Leave Act, Mass. X.X.
x.
148 and 151B, and any other federal, state or local statute, regulation,
ordinance or common law creating employment-related causes of action, and all
claims related to or arising out of your employment or your separation from
employment with NetScout. Nothing in this General Release shall prevent you
from
seeking to enforce your rights under this Agreement and your rights under the
Indemnification Agreement between you and NetScout dated as of September 13,
2006.
8. Second
General Release of Claims.
You agree that, on your Separation Date, you will sign and deliver to NetScout
a
second General Release of Claims containing substantially the same provisions
of
Section 7 with such changes as may be necessary or deemed desirable by
Xx.
Xxxxxxxx Xxxxx
January
3, 2007
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NetScout because of changes in applicable law, releasing NetScout and its parents and affiliates, and each of their respective officers, directors, employees, agents, successors and assigns from any and all claims that may have arisen between the date you sign this Agreement and the third anniversary of the date hereof. Your eligibility to continue to receive the severance and benefits described in Section 3 is conditional upon your signing and delivering to NetScout this second General Release of Claims as provided in this Section 8. Nothing in this Second General Release shall prevent you from seeking to enforce your rights under this Agreement and your rights under the Indemnification Agreement between you and NetScout dated as of September 13, 2006.
9. Affirmation
of Continuing Obligations.
You hereby acknowledge and reaffirm your continuing obligations under the
Non-Competition Agreement dated January 15, 1999 between you and
NetScout.
10. Confidentiality
of Agreement.
Unless your public disclosure of this Agreement is required, you agree to keep
strictly confidential, not to make public and not to disclose to anyone in
any
manner the terms of this Agreement except to your immediate family or other
heirs entitled to a benefit hereunder, state and federal tax authorities, your
attorneys, tax preparers, accountants or other professional advisers, and as
may
be necessary to enforce this Agreement or upon court order.
11. CONSULTATION
WITH COUNSEL; TIME FOR SIGNING; REVOCATION.
YOU
HAVE THE RIGHT TO CONSULT WITH AN ATTORNEY OF YOUR OWN CHOICE PRIOR TO SIGNING
THIS AGREEMENT. YOU HAVE UNTIL TWENTY-ONE (21) DAYS FROM YOUR RECEIPT OF THIS
AGREEMENT TO DECIDE WHETHER TO SIGN IT. YOU WILL HAVE SEVEN (7) DAYS AFTER
SIGNING THIS AGREEMENT TO REVOKE YOUR SIGNATURE. IF YOU INTEND TO REVOKE YOUR
SIGNATURE, YOU MUST DO SO IN WRITING ADDRESSED AND DELIVERED TO ME PRIOR TO
THE
END OF THE 7-DAY REVOCATION PERIOD. THIS
AGREEMENT SHALL NOT BE EFFECTIVE, AND NEITHER NETSCOUT NOR YOU SHALL HAVE ANY
RIGHTS OR OBLIGATIONS HEREUNDER, UNTIL THE EXPIRATION OF THE 7-DAY REVOCATION
PERIOD.
12. General
Provisions.
a) Right
to Cure.
NetScout will provide you with written notice in the event that it determines
you have failed to comply with the provisions of this Agreement, and you shall
have 30 business days to cure any such noncompliance after delivery of such
written notice to you.
b) Severability.
You agree that if any of the provisions of this Agreement are declared or
determined by any court to be illegal or invalid, the validity of the remaining
parts, terms or provisions shall not be affected.
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Xxxxxxxx Xxxxx
January
3, 2007
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c) Enforcement;
Applicable Law; Jurisdiction.
This Agreement is intended to operate as a contract under seal and shall be
governed by and construed in accordance with the laws of the Commonwealth of
Massachusetts. You hereby agree that any dispute concerning or arising out
of
this Agreement shall be brought in any court of competent jurisdiction within
the Commonwealth of Massachusetts, and you hereby consent to jurisdiction in
such courts.
d) Entire
Agreement; No Representations.
This Agreement constitutes the entire agreement between you and NetScout
concerning the terms and conditions of your separation from employment with
NetScout and supersedes all prior and contemporaneous agreements,
understandings, negotiations and discussions, whether oral or written, between
you and NetScout, except as provided in Section 9 and except as provided under
the Indemnification Agreement between you and NetScout dated as of September
13,
2006. You agree that NetScout has not made any statements or promises to you
regarding the meaning or implication of any provision of this Agreement other
than as stated herein.
e) Modification
and Waiver.
This Agreement may be amended or modified only in a writing signed by you and
an
authorized representative of NetScout. The failure of you or NetScout at any
time to require the performance of any provision of this Agreement shall in
no
manner affect either party’s right at a later time to enforce the same
provision.
f) Section
409A.
It is the intention of the parties that no payment or entitlement pursuant
to
this Agreement will give rise to any adverse tax consequences to any person
pursuant to Section
409A of the Code. Notwithstanding any provision in this Agreement to the
contrary, this Agreement shall be interpreted, applied and to the minimum extent
necessary, amended, so that this Agreement does not fail to meet, and is
operated in accordance with, the requirements of Section 409A of the Code.
It is
the intent of the parties that any such amendment will give you substantially
the same economic value as contained in this Agreement. Any
reference in this Agreement to Section 409A of the Code shall also include
any
proposed, temporary or final regulations, or any other guidance, promulgated
with respect to such Section by the U.S. Department of the Treasury or the
Internal Revenue Service.
g) Successors
and Assigns.
All of the terms and conditions hereof shall be for and inure to the benefit
of
and shall bind the successors and assigns of NetScout. NetScout shall cause
any
successor to NetScout’s business (whether by merger, consolidation, sale of
assets or otherwise) to agree to be bound by NetScout’s obligations under this
Agreement, including, without limitation, this Section 12(g).
Xx.
Xxxxxxxx Xxxxx
January
3, 2007
Page
6
Please
indicate your understanding and acceptance of this Agreement by signing and
returning one copy to me. The other copy is for your records.
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Very
truly yours,
/s/
Xxxx Xxxxxxx
Xxxx
Xxxxxxx
CEO
NetScout
Systems, Inc.
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Accepted
and Agreed:
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/s/
Xxxxxxxx
Xxxxx
Xxxxxxxx
Xxxxx
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Dated:
January 3, 2007
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