OMNITURE, INC. AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT
Exhibit 10.1
This Amended and Restated Change of Control Agreement (the “Agreement”) is made and entered
into by and between Xxxxxxx Xxxxxxx (“Employee”) and Omniture, Inc. (the “Company”), effective as
of March 31, 2008 (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. This Agreement amends and restates the Change of Control Agreement dated June 7, 2006
between the Company and Employee.
5. Certain capitalized terms used in the Agreement are defined in Section 7 below.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto
agree 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
months prior to a Change of Control and ending on the later of (A) twelve (12) months following a
Change of Control, or (B) one month following the latest of the originally scheduled one-year,
two-year or four-year cliff vesting date on any of Employee’s Company stock options held by
Employee immediately prior to 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 herein) or (ii) the Company (or any parent or subsidiary of the Company)
terminates Employee’s employment for other than “Cause” (as defined herein), or (iii) Employee dies
or terminates employment due to becoming Disabled (as defined herein) and Employee, except in the
case of death, signs and does not revoke a standard release of claims with the Company in a form
acceptable to the Company (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 seventy-five percent 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 seventy-five percent of Employee’s target bonus for 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 then
unvested Employee’s outstanding stock options, stock appreciation rights, restricted stock units
and other Company equity compensation awards (the “Equity Compensation Awards”) shall immediately
vest and became 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) nine (9) 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 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.
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(b) Timing of Severance Payments. The severance payment to which Employee is entitled
shall be paid by the Company to Employee in cash and in full, not later than ten (10) calendar days
after the effective date of the Release. 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 Employee’s
designated beneficiary, if living, or otherwise to the personal representative of Employee’s
estate.
(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. Notwithstanding anything to the contrary in
this Agreement, if Employee is a “specified employee” within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”) and the final regulations and any other
guidance promulgated thereunder (“Section 409A”) at the time of Employee’s termination (other than
due to death), and the severance payable to Employee, if any, pursuant to this Agreement, when
considered together with any other severance payments or separation benefits which may be
considered deferred compensation under Section 409A (together, the “Deferred Compensation
Separation Benefits”) will not and could not under any circumstances, regardless of when such
termination occurs, be paid in full by the fifteenth day of the third month of the Company’s fiscal
year following Employee’s termination, then any portion of the Deferred Compensation Separation
Benefits that would otherwise have been payable within the first six (6) months following
Employee’s termination of employment, 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 termination of
employment. For these purposes, each severance payment is hereby designated as a separate payment
and will not collectively be treated as a single payment. 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 his termination but prior to the six (6) month anniversary of his termination, 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.
This provision is 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
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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
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 nine 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) (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 nine-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) during the nine 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) and the value of any welfare
plan reimbursements previously paid under Section 3(a)(iii).
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
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Company, if any, (i) constitute “parachute payments” within the meaning of Code Section 280G,
(ii) would be subject to the excise tax imposed by Code Section 4999, and (iii) the aggregate value
of such parachute payments, as determined in accordance with Code Section 280G 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 Code Section 280G(b)(3), then such
benefits shall be reduced to the extent necessary (but only to that extent) so that no portion of
such benefits will be subject to excise tax under Code Section 4999.
(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 Code Section 280G, (ii) would be
subject to the excise tax imposed by Code Section 4999, and (iii) the aggregate value of such
parachute payments, as determined in accordance with Code Section 280G 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 Code Section 280G(b)(3), 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 Code Section
280G 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 Code Section 280G, but will be
considered for other purposes of Code Section 280G (for instance, in determining whether Employee
is a “shareholder” under Treasury Regulation Section 1.280G-1 Q/A 15 and 17).
(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. The Company shall bear all
costs the Accountants may reasonably incur in connection with any calculations contemplated by this
Section 6.
7. Definition of Terms. The following terms referred to in this Agreement shall have
the following meanings:
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(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 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.
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(d) Good Reason. “Good Reason” means without Employee’s express written consent (i) a
material reduction of Employee’s duties, title, authority or responsibilities, relative to
Employee’s duties, title, authority or responsibilities as in effect immediately prior to such
reduction, or the assignment to Employee of such reduced duties, title, authority or
responsibilities; provided, however, that Employee may only resign for Good Reason
under this subsection 7(d)(i) in the period commencing six months following a Change of Control and
ending on the termination of the Change of Control Period; provided, further, that
such resignation for Good Reason may be on account of a material reduction in Employee’s duties,
title, authority or responsibilities effectuated at any time during the Change of Control Period,
including prior to the date that is six months following a Change of Control; (ii) a reduction by
the Company in the base salary of Employee as in effect immediately prior to such reduction; or
(iii) the relocation of Employee to a facility or a location more than thirty-five (35) miles from
such Employee ‘s then present location.
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
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) of
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this Agreement. 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.
(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.
(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.
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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 set forth below.
| COMPANY | OMNITURE, INC. | |||
| By: | /s/ Xxxxx X. Xxxxxxxxx | |||
| Title: | Chief Legal Officer | |||
EMPLOYEE
|
By: | /s/ Xxxxxxx X. Xxxxxxx | ||
| Title: | Chief Financial Officer | |||
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