{"id":38631,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/change-of-control-severance-agreement-lynuxworks-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"change-of-control-severance-agreement-lynuxworks-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/change-of-control-severance-agreement-lynuxworks-inc.html","title":{"rendered":"Change of Control Severance Agreement &#8211; LynuxWorks Inc."},"content":{"rendered":"<pre>                               LYNUXWORKS, INC.\n\n                     CHANGE OF CONTROL SEVERANCE AGREEMENT\n\n\n     This Change of Control Severance Agreement (the \"Agreement\") is made and\nentered into effective as of _________ ___, 2000 (the \"Effective Date\"), by and\nbetween _____________________ (the \"Employee\") and LynuxWorks, a California\ncorporation (the \"Company\").  Certain capitalized terms used in this Agreement\nare defined in Section 1 below.\n\n\n                                R E C I T A L S\n                                ---------------\n\n     A.  It is expected that the Company from time to time will consider the\npossibility of a Change of Control. The Board of Directors of the Company (the\n\"Board\") recognizes that such consideration can be a distraction to the Employee\nand can cause the Employee to consider alternative employment opportunities.\n\n     B.  The Board believes that it is in the best interests of the Company and\nits shareholders to provide the Employee with an incentive to continue his\nemployment and to maximize the value of the Company upon a Change of Control for\nthe benefit of its shareholders.\n\n     C.  In order to provide the Employee with enhanced financial security and\nsufficient encouragement to remain with the Company notwithstanding the\npossibility of a Change of Control, the Board believes that it is imperative to\nprovide the Employee with certain severance benefits upon the Employee's\ntermination of employment following a Change of Control.\n\n\n                                   AGREEMENT\n                                   ---------\n\n     In consideration of the mutual covenants herein contained and the continued\nemployment of Employee by the Company, the parties agree as follows:\n\n     1.  Definition of Terms.  The following terms referred to in this Agreement\n         -------------------                                                    \nshall have the following meanings:\n\n         (a) Cause. \"Cause\" shall mean (i) any act of personal dishonesty taken\n             -----     \nby the Employee in connection with his responsibilities as an employee which is\nintended to result in substantial personal enrichment of the Employee, (ii)\nEmployee's conviction of a felony which the Board reasonably believes has had or\nwill have a material detrimental effect on the Company's reputation or business,\n(iii) a willful act by the Employee which constitutes misconduct and is\ninjurious to the Company, and (iv) continued willful violations by the Employee\nof the Employee's obligations to the Company after there has been delivered to\nthe Employee a written demand for\n\n\n \nperformance from the Company which describes the basis for the Company's belief\nthat the Employee has not substantially performed his duties.\n\n         (b) Change of Control. \"Change of Control\" shall mean the occurrence of\n             -----------------\nany of the following events:\n\n             (i)   the approval by shareholders of the Company of a merger or\nconsolidation of the Company with any other corporation, other than a merger or\nconsolidation which would result in the voting securities of the Company\noutstanding immediately prior thereto continuing to represent (either by\nremaining outstanding or by being converted into voting securities of the\nsurviving entity) more than fifty percent (50%) of the total voting power\nrepresented by the voting securities of the Company or such surviving entity\noutstanding immediately after such merger or consolidation;\n\n             (ii)  the approval by the shareholders of the Company of a plan of\ncomplete liquidation of the Company or an agreement for the sale or disposition\nby the Company of all or substantially all of the Company's assets; or\n\n             (iii) any \"person\" (as such term is used in Sections 13(d) and\n14(d) of the Securities Exchange Act of 1934, as amended) becoming the\n\"beneficial owner\" (as defined in Rule 13d-3 under said Act), directly or\nindirectly, of securities of the Company representing 50% or more of the total\nvoting power represented by the Company's then outstanding voting securities.\n\n         (c) Compensation Continuation Period. \"Compensation Continuation\n             --------------------------------\nPeriod\" shall mean the period of time commencing with termination of the\nEmployee's employment as a result of Involuntary Termination at anytime within\ntwelve (12) months after a Change of Control and ending with the expiration of\nsix (6) months following the date of the Employee's termination.\n\n         (d) Involuntary Termination. \"Involuntary Termination\" shall mean (i)\n             -----------------------\nwithout the Employee's express written consent, a significant reduction of the\nEmployee's duties, position or responsibilities relative to the Employee's\nduties, position or responsibilities in effect immediately prior to such\nreduction, or the removal of the Employee from such position, duties and\nresponsibilities, unless the Employee is provided with comparable duties,\nposition and responsibilities; provided, however, that a reduction in duties,\nposition or responsibilities solely by virtue of the Company being acquired and\nmade part of a larger entity (as, for example, when the Chief Financial Officer\nof the Company remains as such following a Change of Control but is not made the\nChief Financial Officer of the acquiring corporation) shall not constitute an\n\"Involuntary Termination;\" (ii) without the Employee's express written consent,\na substantial reduction, without good business reasons, of the facilities and\nperquisites (including office space and location) available to the Employee\nimmediately prior to such reduction; (iii) a reduction by the Company of the\nEmployee's base salary as in effect immediately prior to such reduction; (iv) a\nmaterial reduction by the Company in the kind or level of employee benefits to\nwhich the Employee is entitled immediately prior to such reduction with the\nresult that the Employee's overall benefits package is significantly reduced;\n(v) without the Employee's express written consent, the relocation of the\n\n                                      -2-\n\n \nEmployee to a facility or a location more than thirty-five (35) miles from his\ncurrent location; (vi) any purported termination of the Employee by the Company\nwhich is not effected for Cause or for which the grounds relied upon are not\nvalid; or (vii) the failure of the Company to obtain the assumption of this\nAgreement by any successors contemplated in Section 5 below.\n\n         (e)  Termination Date. \"Termination Date\" shall mean the effective date\n              ----------------\nof any notice of termination delivered by one party to the other hereunder.\n\n     2.  Term of Agreement. This Agreement shall terminate upon the date that\n         -----------------\nall obligations of the parties hereto under this Agreement have been satisfied.\n\n     3.  At-Will Employment. The Company and the Employee acknowledge that the\n         ------------------    \nEmployee's employment is and shall continue to be at-will, as defined under\napplicable law. If the Employee's employment terminates for any reason, the\nEmployee shall not be entitled to any payments, benefits, damages, awards or\ncompensation other than as provided by this Agreement, or as may otherwise be\nestablished under the Company's then existing employee benefit plans or policies\nat the time of termination.\n\n     4.  Severance Benefits.\n         ------------------ \n\n         (a) Termination Following A Change of Control.\n             ----------------------------------------- \n\n             (i)  Involuntary Termination. If the Employee's employment with the\n                  -----------------------       \nCompany terminates as a result of an Involuntary Termination at any time within\ntwelve (12) months after a Change of Control, the Employee shall be entitled to\nreceive continuing payments of severance pay at a rate equal to the sum of: six\n(6) months of the Employee's base salary or target commission goal, if\napplicable, (as in effect immediately prior to the Change of Control). Such\nseverance payments shall be paid monthly in accordance with the Company's normal\npayroll practices during the Compensation Continuation Period. In addition,\nduring the Compensation Continuation Period, the Company shall continue to make\navailable to the Employee and Employee's spouse and dependents covered under any\ngroup health, life or other similar insurance plans of the Company on the date\nof such termination (the \"Covered Dependents\"), and pay for, to the same extent\nas paid prior to termination of employment, all group health, life and other\nsimilar insurance plans in which Employee or such Covered Dependents participate\non the date of the Employee's termination.\n\n             (ii) Other Termination. If the Employee's employment with the\n                  -----------------\nCompany terminates other than as a result of an Involuntary Termination at any\ntime within twelve (12) months after a Change of Control, then the Employee\nshall not be entitled to receive severance or other benefits hereunder, but may\nbe eligible for those benefits (if any) as may then be established under the\nCompany's then existing severance and benefits plans and policies at the\nTermination Date.\n\n         (b) Termination Apart from a Change of Control. If the Employee's\n             ------------------------------------------\nemployment with the Company terminates for any or no reason other than within\nthe twelve (12) months following a Change of Control, then the Employee shall\nnot be entitled to receive severance or other\n\n                                      -3-\n\n \nbenefits hereunder, but may be eligible for those benefits (if any) as may then\nbe established under the Company's then existing severance and benefits plans\nand policies at the time of such termination.\n\n         (c)   Accrued Wages and Vacation; Expenses. Without regard to the\n               ------------------------------------\nreason for, or the timing of, Employee's termination of employment: (i) the\nCompany shall pay the Employee any unpaid base salary due for periods prior to\nthe Termination Date; (ii) the Company shall pay the Employee all of the\nEmployee's accrued and unused vacation through the Termination Date; and (iii)\nfollowing submission of proper expense reports by the Employee, the Company\nshall reimburse the Employee for all expenses reasonably and necessarily\nincurred by the Employee in connection with the business of the Company prior to\nthe Termination Date. These payments shall be made promptly upon termination and\nwithin the period of time mandated by law.\n\n     5.  Option Acceleration.  If the Employee's employment with the Company\n         -------------------                                                \nterminates as a result of an Involuntary Termination at any time within twelve\n(12) months after a Change of Control, the vesting and exercisability of one\nhundred percent (100%) of any unvested options granted to the Employee by the\nCompany shall become vested and exercisable as of the date of the Employee's\nInvoluntary Termination.\n\n     6.  Successors.\n         ---------- \n\n         (a) Company's Successors.  Any successor to the Company (whether\n             --------------------                                        \ndirect or indirect and whether by purchase, lease, merger, consolidation,\nliquidation or otherwise) to all or substantially all of the Company's business\nand\/or assets shall assume the Company's obligations under this Agreement and\nagree expressly to perform the Company's obligations under this Agreement in the\nsame manner and to the same extent as the Company would be required to perform\nsuch obligations in the absence of a succession.  For all purposes under this\nAgreement, the term \"Company\" shall include any successor to the Company's\nbusiness and\/or assets which executes and delivers the assumption agreement\ndescribed in this subsection (a) or which becomes bound by the terms of this\nAgreement by operation of law.\n\n         (b) Employee's Successors. Without the written consent of the Company,\n             ---------------------\nEmployee shall not assign or transfer this Agreement or any right or obligation\nunder this Agreement to any other person or entity. Notwithstanding the\nforegoing, the terms of this Agreement and all rights of Employee hereunder\nshall inure to the benefit of, and be enforceable by, Employee's personal or\nlegal representatives, executors, administrators, successors, heirs,\ndistributees, devisees and legatees.\n\n     7.  Notices.\n         ------- \n\n         (a) General.  Notices and all other communications contemplated by\n             -------                                                       \nthis Agreement shall be in writing and shall be deemed to have been duly given\nwhen personally delivered or when mailed by U.S. registered or certified mail,\nreturn receipt requested and postage prepaid.  In the case of the Employee,\nmailed notices shall be addressed to him at the home address\n\n                                      -4-\n\n \nwhich he most recently communicated to the Company in writing. In the case of\nthe Company, mailed notices shall be addressed to its corporate headquarters,\nand all notices shall be directed to the attention of its Secretary.\n\n          (b)  Notice of Termination.  Any termination by the Company for Cause\n               ---------------------                                           \nor by the Employee as a result of a voluntary resignation or an Involuntary\nTermination shall be communicated by a notice of termination to the other party\nhereto given in accordance with this Section.  Such notice shall indicate the\nspecific termination provision in this Agreement relied upon, shall set forth in\nreasonable detail the facts and circumstances claimed to provide a basis for\ntermination under the provision so indicated, and shall specify the Termination\nDate (which shall be not more than 30 days after the giving of such notice).\nThe failure by the Employee to include in the notice any fact or circumstance\nwhich contributes to a showing of Involuntary Termination shall not waive any\nright of the Employee hereunder or preclude the Employee from asserting such\nfact or circumstance in enforcing his rights hereunder.\n\n     8.   Arbitration.\n          ----------- \n\n          (a)   Any dispute or controversy arising out of, relating to, or in\nconnection with this Agreement, or the interpretation, validity, construction,\nperformance, breach, or termination thereof, shall be settled by binding\narbitration to be held in Santa Clara County, California, in accordance with the\nNational Rules for the Resolution of Employment Disputes then in effect of the\nAmerican Arbitration Association (the \"Rules\"). The arbitrator may grant\ninjunctions or other relief in such dispute or controversy. The decision of the\narbitrator shall be final, conclusive and binding on the parties to the\narbitration. Judgment may be entered on the arbitrator's decision in any court\nhaving jurisdiction.\n\n          (b)   The arbitrator(s) shall apply California law to the merits of\nany dispute or claim, without reference to conflicts of law rules. The\narbitration proceedings shall be governed by federal arbitration law and by the\nRules, without reference to state arbitration law. Employee hereby consents to\nthe personal jurisdiction of the state and federal courts located in California\nfor any action or proceeding arising from or relating to this Agreement or\nrelating to any arbitration in which the parties are participants.\n\n          (c)   The Company and Employee shall each pay one-half of the costs\nand expenses of such arbitration, and each shall separately pay its counsel fees\nand expenses.\n\n          (d)   Employee understands that nothing in this Section modifies\nEmployee's at-will employment status. Either Employee or the Company can\nterminate the employment relationship at any time, with or without cause.\n\n          (e)   EMPLOYEE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES\nARBITRATION. EMPLOYEE UNDERSTANDS THAT SUBMITTING ANY CLAIMS ARISING OUT OF,\nRELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,\nVALIDITY, CONSTRUCTION, PERFORMANCE,\n\n                                      -5-\n\n \nBREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, CONSTITUTES A WAIVER OF\nEMPLOYEE'S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES\nRELATING TO ALL ASPECTS OF THE EMPLOYER\/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT\nLIMITED TO, THE FOLLOWING CLAIMS:\n\n          (i)   ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH\nOF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND\nFAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF\nEMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR\nINTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND\nDEFAMATION.\n\n          (ii)  ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL STATE OR\nMUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS\nACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT\nACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR\nSTANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE\nSECTION 201, et seq;\n\n          (iii) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS\nRELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.\n\n     9.  Miscellaneous Provisions.\n         ------------------------ \n\n         (a)  No Duty to Mitigate. The Employee shall not be required to\n              ------------------- \nmitigate the amount of any payment contemplated by this Agreement, nor shall any\nsuch payment be reduced by any earnings that the Employee may receive from any\nother source.\n\n         (b)  Waiver. No provision of this Agreement may be modified, waived or\n              ------\ndischarged unless the modification, waiver or discharge is agreed to in writing\nand signed by the Employee and by an authorized officer of the Company (other\nthan the Employee). No waiver by either party of any breach of, or of compliance\nwith, any condition or provision of this Agreement by the other party shall be\nconsidered a waiver of any other condition or provision or of the same condition\nor provision at another time.\n\n         (c)  Integration. This Agreement, the Employment Agreement dated July\n              -----------    \n____, 2000, and the stock option agreements representing the Options represent\nthe entire agreement and understanding between the parties as to the subject\nmatter herein and supersede all prior or contemporaneous agreements, whether\nwritten or oral.\n\n         (d)  Choice of Law. The validity, interpretation, construction and\n              ------------- \nperformance of this Agreement shall be governed by the internal substantive\nlaws, but not the conflicts of law rules, \n\n                                      -6-\n\n \nof the State of California.\n\n          (e)  Severability. The invalidity or unenforceability of any provision\n               ------------\nor provisions of this Agreement shall not affect the validity or enforceability\nof any other provision hereof, which shall remain in full force and effect.\n\n          (f)  Employment Taxes. All payments made pursuant to this Agreement\n               ----------------\nshall be subject to withholding of applicable income and employment taxes.\n\n          (g)  Counterparts. This Agreement may be executed in counterparts,\n               ------------\neach of which shall be deemed an original, but all of which together will\nconstitute one and the same instrument.\n\n     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the\ncase of the Company by its duly authorized officer, as of the day and year first\nabove written.\n\n\nCOMPANY:                                 LYNUXWORKS, INC.\n\n     \n                                         By:_________________________________\n\n                                         Title:______________________________\n    \n\nEMPLOYEE:                                ____________________________________ \n\n                                      -7-\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8098],"corporate_contracts_industries":[9510],"corporate_contracts_types":[9539,9551],"class_list":["post-38631","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-lynuxworks-inc","corporate_contracts_industries-technology__programming","corporate_contracts_types-compensation","corporate_contracts_types-compensation__severance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38631","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38631"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38631"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38631"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38631"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}