OPTICAL COATING LABORATORY, INC.
CHANGE IN CONTROL AGREEMENT
AGREEMENT made this 20th day of November 1997, between OPTICAL COATING
LABORATORY, INC., having its principal place of business at 0000 Xxxxxxxxxx
Xxxxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000 ("Employer"), and ("Employee").
1. Employment. In addition to the policies and procedures published
from time to time by Employer in its Employee Handbook, Employer hereby
agrees to employ Employee, and Employee hereby agrees to be employed by
Employer, subject to the terms and provisions herein. As used herein, the
phrase "employment term" refers to the entire period of employment of
Employee by Employer hereunder.
2. Duties of Employee. Employee shall serve in such capacities and
shall do and perform all such services, acts or things necessary and
appropriate in the course of his or her employment as reasonably required
from time to time by Employer. Employee shall devote his or her knowledge,
skill, working time and energy to the performance of his or her duties in
an efficient, trustworthy and businesslike manner. Employee shall not
directly or indirectly render any services of a business, commercial or
professional nature during the employment term to any other person or
organization, whether for compensation or otherwise, that would conflict
with the rendition of services under this agreement without the prior
written consent of Employer.
3. Compensation of Employee. As compensation for his or her
services hereunder, Employee shall receive a base salary of $____________
DOLLARS) per year payable in equal installments no less than weekly during
the employment term. Employee's salary may be increased in an amount
determined in the sole discretion of Employer. Employee shall also be
entitled to participate in such other retirement, bonus and other benefits
as may be available to other employees of his or her status and rank with
Employer and which shall be commensurate with his or her rank, experience
and record.
4. Expenses. Employee is authorized to incur reasonable business
expenses necessary in the performance of his or her duties hereunder,
including travel, meal and lodging expenses, provided such expenses have
been incurred in conformity with Employer's policy prevailing from time to
time for all such business expenses. Employee shall provide Employer
documentary evidence in form reasonably required by Employer to confirm the
propriety of such expenses and to enable Employer, to the extent possible,
to deduct such expenses for federal and state income tax purposes.
5. Termination by Employee after Occurrence of a Hostile Change in
Control. Employee shall have the right to terminate his or her employment
any time during the period beginning three (3) months after the occurrence
of a Change in Control and ending twelve (12) months after the occurrence
of such Change in Control. If Employee terminates his or her employment
during such time period, Employee shall be paid an amount equal to the
lesser of (i) eighteen (18) months of Employee's maximum salary in effect
within twelve (12) months of termination, or (ii) the maximum amount
payable under Section 280G of the Internal Revenue Code of 1986, as the
same may be amended from time to time (the "Code"), without any portion of
such amount being classified as an "excess parachute payment" within the
meaning of Section 280G(b)(1) of the Code, after taking into account all
other "parachute payments" within the meaning of Section 280G(b)(2) of the
Code.
6. Termination or Constructive Dismissal by Employer after
Occurrence of Change in Control. Except in the case of a Termination for
Cause, if any time within two (2) years after the occurrence of a Change in
Control either (i) Employer terminates Employee's employment or (ii)
Employee terminates his or her employment following a Constructive
Dismissal by Employer, then Employee shall be paid an amount equal to the
lesser of (A) thirty-six (36) months of Employee's maximum salary in effect
within twelve (12) months of termination, or (B) the maximum amount payable
under Section 280G of the Code, without any portion of such amount being
classified as an "excess parachute payment" within the meaning of Section
280G(b)(1) of the Code, after taking into account all other "parachute
payments" within the meaning of Section 280G(b)(2) of the Code. If
Employee is entitled to payment under this subparagraph 5, Employee shall
not be entitled to payment under subparagraph 6.
7. Time of Payment. Employer shall pay any amounts due to Employee
hereunder upon termination of Employee's employment.
8. No other Severance Payments. If Employee receives a payment
under either subparagraphs 5 or 6, Employee shall not be entitled to any
severance payments that might otherwise be payable to Employee.
9. Acceleration of Unvested Stock Options. Upon a Hostile Change in
Control or a Change in Control as defined herein, all unvested outstanding
stock options held by Employee shall be immediately exercisable.
10. Certain Definitions. For Purposes of this agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any person who or which,
together with all Affiliates and Associates of such person, shall be the
owner, beneficial or otherwise, of at least twenty percent (20%) of the
shares of Common Stock of Employer then outstanding, but shall not include
Employer, any subsidiary of Employer, any employee benefit plan of Employer
or of any subsidiary of Employer, or any person or entity organized,
appointed or established by Employer for or pursuant to the terms of any
such plan.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended and in
effect on the date of this Agreement.
(c) "Continuing Director" shall mean (i) any member of the Board
of Directors of Employer, while such person is a member of the Board, and
who was a member of the Board prior to the date of this Agreement, or (ii)
any person who subsequently becomes a member of the Board, while such
person is a member of the Board, if such person's nomination for election
or reelection to the Board is recommended or approved by a majority of the
Continuing Directors.
(d) "Constructive Dismissal by Employer" shall occur if Employer
demotes Employee, reduces Employee's duties, decreases Employee's benefits
or compensation, or relocates Employee to a location outside of the
community where Employee is employed as of the date of the Change in
Control.
(e) "Change in Control" shall mean the occurrence of any of the
events described in subparagraph (i), or (ii), or below:
(i) The acquisition of more than fifty percent (50%) of the
shares of Common Stock of Employer then outstanding by an
Acquiring Person, alone or together with such person's Affiliates
or Associates, including any such acquisitions pursuant to a
"reorganization" within the meaning of Section 181 of the
California Corporations Code; or
(ii) The failure of a majority of the members of the
Board of Directors of Employer to be Continuing Directors.
(f) "Hostile Change in Control" shall mean the acquisition of
more than twenty percent (20%) of the shares of Common Stock of Employer
then outstanding by an Acquiring Person, alone or together with such
person's Affiliates or Associates, including any such acquisitions pursuant
to a "reorganization" within the meaning of Section 181 of the California
Corporations Code, and (B) the adoption by Employer's Board of Directors of
a resolution (i) disapproving the acquisition in subparagraph 10(f), or
(ii) declaring operative the provisions of this Agreement pertaining to a
Hostile Change in Control.
(g) "Termination for Cause" shall mean a termination of the
Employee's employment for a willful breach of duty in the course of his or
her employment, or in the case of his or her habitual neglect or continued
incapacity to perform his or her duty.
11. Effect of Employer's Merger, Transfer of Assets or Dissolution.
This Agreement shall not be terminated by any merger or consolidation where
Employer is not the consolidated or surviving corporation, transfer of
substantially all of the assets of Employer, or voluntary or involuntary
dissolution of Employer. In the event of any such merger, consolidation or
transfer of assets, the surviving corporation or the transferee of
Employer's assets shall be bound by the provisions of this Agreement, and
Employer shall take all actions necessary to insure that such corporation
or transferee is bound by the provisions of this Agreement.
12. Arbitration. Any controversy between Employer and Employee
involving the construction or application of any of the terms, provisions
or conditions of this Agreement, any claim hereunder, or any claim
pertaining to any covenant of good faith and fair dealing or any other duty
implied by law, shall on the written request of either party served on the
other be submitted to arbitration, and such arbitration shall proceed and
be governed by the provisions of the California Arbitration Act. Employer
and Employee shall, within fourteen (14) days after such notice, each
appoint one person to hear and determine the dispute, and the two
appointees, within fourteen (14) days after appointment of both of them,
shall jointly select a third impartial arbitrator whose decision shall be
final and conclusive upon both parties. The arbitrators shall not have the
power to alter, amend or modify the terms of this agreement. The decision
of the arbitrators shall be final and binding. The costs of arbitration,
including the reasonable attorney's fees of the prevailing party, shall be
borne by the losing party. Arbitration as provided herein shall be the
exclusive means to resolve any of the controversies referred to in this
paragraph 8.
13. Notices. Any notices to be given hereunder by either party to
the other may be effected by personal delivery in writing or by mail,
registered or certified, postage prepaid with return receipt requested.
Mail notices shall be addressed to the parties at the address of Employer
appearing above or at the address of Employee appearing beneath his or her
signature below, but each party may change his or her address by written
notice in accordance with this paragraph. Notices delivered personally
shall be deemed communicated as of actual receipt; mail notices shall be
deemed communicated as of two days after mailing.
14. Partial Invalidity. If any provision of this Agreement is held
by a court of competent jurisdiction to be invalid, void or unenforceable,
the remaining provisions shall nevertheless continue in full force without
being impaired or invalidated in any way.
15. Agreement Supersedes Any Inconsistent Prior Agreements or
Understandings. The terms of this Agreement supersede any inconsistent
prior promises, policies, representations, understandings, arrangements or
agreements between the parties.
16. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of California.
OPTICAL COATING LABORATORY, INC.
By
EMPLOYEE:
Signature Date
Address:
Optical Coating Laboratory, Inc.
Change in Control Agreement
