EXHIBIT 10.1
SENIOR MANAGEMENT
CHANGE OF CONTROL AGREEMENT BETWEEN
XXXX XXXXXX AND
SPSS INC.
THIS CHANGE OF CONTROL AGREEMENT, dated as of May 1, 1998 (the
"Agreement"), is by and between SPSS Inc., a Delaware corporation having its
principal offices at 000 X. Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 ("SPSS" or
the "Company"), and Jack_Noonan, a senior management employee of SPSS (the
"Employee").
WHEREAS, the Employee is presently serving as the President and Chief
Executive Officer of SPSS; and
WHEREAS, SPSS desires to continue the Employee's services as President and
Chief Executive Officer and to provide the Employee with the benefits set forth
herein in consideration of the Employee's continued employment, and the Employee
is willing to continue his employment as an employee of SPSS and enter into this
Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and
conditions contained herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. Certain Defined Terms.
(a) "Cause" shall mean material nonperformance by the Employee of the
Employee's duties or material injury or harm to the Company or its successor
caused by the Employee.
(b) "Change of Control," as used herein, shall mean any one or more of the
following: (i) the accumulation, by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) not previously owning common stock of the
Company, of Fifteen Percent (15%) or more of the shares of the then outstanding
common stock of SPSS (the "Outstanding Common Stock"), (ii) a merger or
consolidation of SPSS in which SPSS does not survive as an independent public
company, (iii) a sale of all or substantially all of the assets of SPSS, (iv) a
triggering event under any Rights Agreement of SPSS, as such agreement may exist
from time to time, or (v) a liquidation or dissolution of SPSS; provided,
however, that the following acquisitions shall not constitute a Change of
Control for the purposes of this
subsection (a): (i) any acquisition of common stock or securities convertible
into common stock directly from SPSS, or (ii) any acquisition of common stock or
securities convertible into common stock by any employee benefit plan (or
related trust) sponsored or maintained by SPSS.
(c) "Constructive Termination," as used herein, shall mean (i) a reduction,
for a reason other than Cause, in annualized cash compensation by 20% or more
(compared to the cash compensation which the Employee received in the fiscal
year immediately preceding the year of the Effective Date of a Change of
Control) which occurs during any twelve month period beginning on or after the
Effective Date of any Change of Control referred to above and ending on or prior
to the later of (x) the second anniversary date of the Effective Date of any
Change of Control referred to above or (y) the last day of vesting for any SPSS
options then held by the Employee which options have not vested as of the
Effective Date of any Change of Control referred to above; or (ii) any action
(an "Action"), for a reason other than Cause, by SPSS which results in a
diminution in any material respect of the Employee's position, authority, duties
or responsibilities as the same existed immediately prior to the Effective Date
of the Change of Control referred to above. Further, in order for it to be a
Constructive Termination, either (i) or (ii) above must be followed within
ninety (90) days with the resignation of the Employee.
A change in the Employee's title or a transfer to a different division or
subsidiary, whether publicly or privately held, shall not in and of itself
constitute an Action. Rather, the focus turns on the substance of the Employee's
duties.
(d) "Effective Date," as used herein, shall mean the first date during
which a Change of Control (as defined in Section 1(b)) occurs.
2. Change of Control in a Transaction with a Private Company. In the event
a Change of Control occurs as the result of a transaction between SPSS and a
company whose common stock is not publicly traded on a domestic national stock
exchange, the NASDAQ national market, or their respective successors or
equivalents (a "Private Company"), the Employee shall have the rights and
benefits set forth below:
(a) Continued Employment. If upon the occurrence of Change of Control
between SPSS and a Private Company, the Employee is hired for at least a
one-year period, with an employment package equal to or greater than the larger
of (i) the total cash compensation received by the Employee in the immediately
preceding full fiscal year or (ii) two times the Employee's base salary received
in the immediately preceding fiscal year, all of Employee stock options shall
vest on the Effective Date on which the Change of Control occurs and shall be
cashed out at the transaction value on the occurrence of the transaction with
the Private Company on or within ninety (90) days following a Change of Control.
If Employee shall be hired with an employment package equal to or greater than
the larger of (i) the total cash compensation received by Employee in the
preceding fiscal year or (ii) two times the Employee's base salary received in
the immediately preceding fiscal year, Employee
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shall receive an employment agreement which provides for the following upon
involuntary termination without cause or Constructive Termination after the
Effective Date of the Change of Control and within two (2) years after the
Change of Control: (1) a severance package equal to the greater of (i) the
aggregate cash compensation received in the immediately preceding fiscal year or
(ii) two times the Employee's base salary received in the immediately preceding
fiscal year; and (2) in the event of a Constructive Termination, the option to
terminate employment while still receiving the severance package referred to in
2(a)(1) above. If Employee is hired for a period of less than one year, the
provisions of Constructive Termination apply.
(b) Involuntary Termination; Constructive Termination Upon a Change of
Control. If upon the occurrence of Change of Control between SPSS and a Private
Company, there is either an involuntary termination of Employee without Cause or
Constructive Termination, the vesting of all Employee stock options shall be
accelerated to the Effective Date on which the Change of Control occurs and
shall be cashed out at the transaction value on the occurrence of the
transaction with the Private Company on or within ninety (90) days from the
occurrence of the Change of Control. Employee shall receive a one (1) year
severance package equal to the greater of (i) the Employee's cash compensation
received in the fiscal year immediately preceding the year of the Effective Date
of a Change of Control or (ii) two times the Employee's base salary received in
the fiscal year immediately preceding the year of the Effective Date of a Change
of Control.
(c) Voluntary Resignation. If upon the occurrence of Change of Control
between SPSS and a Private Company, Employee voluntarily resigns, all of
Employee's unvested SPSS stock options shall be forfeited and all of Employee's
vested options shall be cashed out at the transaction value on the occurrence of
the transaction with the Private Company on or within ninety (90) days following
a Change of Control.
3. Change of Control in a Transaction With a Public Company. In the event a
Change of Control occurs between SPSS and a company whose common stock is
publicly traded on the domestic national stock exchange, the NASDAQ national
market, or their respective successors and equivalents (a "Public Company"), the
Employee shall have the rights and benefits set forth below:
(a) Continued Employment. If upon the occurrence of a Change of Control
between SPSS and a Public Company, the Employee is hired for at least a one-year
period, with an employment package equal to or greater than the larger of (i)
the total cash compensation received by the Employee in the immediately
preceding year or (ii) two times the Employee's base salary received in the
immediately preceding fiscal year, all of Employee's stock options shall either
(i) vest on the Effective Date on which the Change of Control occurs and shall
be cashed out at the transaction value on or within ninety (90) days following a
Change of Control; or (ii) shall be converted into stock options of the
acquiring Public Company on substantially equivalent economic terms
("Replacement Options"). If Replacement Options are granted, they shall continue
to vest at the same rate as under the
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SPSS Option Plan prior to the Change of Control. If Employee shall be hired for
at least a one-year period, by the acquiring Public Company with an employment
package equal to or greater than the larger of (i) the total cash compensation
which Employee received in the fiscal year immediately preceding the year of the
Effective Date of a Change of Control or (ii) two times the Employee's base
salary received in the immediately preceding fiscal year, Employee shall receive
an employment agreement which provides the following upon the occurrence of an
involuntary termination without Cause or Constructive Termination after the
Effective Date of the Change of Control and within two (2) years after the
Change of Control: (1) a severance package equal to the greater of (i) the
aggregate cash compensation received in the immediately preceding fiscal year or
(ii) two times the Employee's base salary received in the immediately preceding
fiscal year; (2) immediate accelerated vesting of all previously unvested
Replacement Options; and (3) in the event of a Constructive Termination, the
option to terminate employment while still receiving the severance package
referred to in 3(a)(i) above. If Employee is hired for a period less than one
year, the provisions of Constructive Termination apply.
If a Constructive Termination or an involuntary Termination without Cause
occurs two (2) years or more after the Effective Date of a Change of Control,
the vesting of all previously unvested Replacement Options shall be accelerated
to the date on which the Employee is subject to a Constructive Termination or
involuntary termination.
(b) Involuntary Termination/Constructive Termination Upon a Change of
Control. If, upon the occurrence of a Change of Control between SPSS and a
Public Company there is either an involuntary termination of an Employee without
Cause or a Constructive Termination of Employee, (i) the vesting of all of
Employee's stock options shall be accelerated to the Effective Date on which the
Change of Control occurs, and shall be cashed out at the Change of Control
transaction value or must be exercised by Employee within ninety (90) days from
the occurrence of a Change of Control (if there is a Change of Control with no
transaction) and (ii) Employee shall receive a one (1) year severance package
equal to the greater of (A) the cash compensation received by Employee in the
fiscal year immediately preceding the year of the Effective Date of a Change of
Control or (B) two times the Employee's base salary received in the fiscal year
immediately preceding the year of the Effective Date of a Change of Control.
(c) Voluntary Resignation on Change of Control. If upon the occurrence of a
Change of Control between SPSS and a Public Company, Employee voluntarily
resigns, at the time of the Effective Date of the Change of Control, all
unvested SPSS stock options held by Employee shall be forfeited, and all vested
options shall be cashed out at the Change of Control transaction value or must
be exercised by Employee within ninety (90) days from the occurrence of such
Change of Control (if there is a Change of Control with no transaction).
4. Health and Welfare Benefits. Notwithstanding the rights and obligations
as outlined in Sections 2 or 3 above, if Employee is involuntarily terminated
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without Cause or is subject to a Constructive Termination on or after the
Effective Date of a Change of Control or within the later of two (2) years
following the Effective Date of a Change of Control in addition to the benefits
set forth above in Sections 2 and 3, the Employee shall continue to receive, at
the cost of the employer, the same health and welfare benefits (in effect at any
time one hundred twenty (120) days prior to the Effective Date of a Change of
Control), but only to the extent each plan which governs the benefits permits
participation by terminated employees, for a period of eighteen (18) months
following the date of involuntary termination without Cause or Constructive
Termination.
5. Non-Compete.
(a) Employee hereby covenants and agrees that during the period of time he
collects a severance package, he shall not (i) directly or indirectly (whether
through a partnership of which the Employee is a partner or through any other
individual or entity in which Employee has any interest, legal or equitable),
engage in any business competitive with the business of SPSS (ii) directly or
indirectly (whether through a partnership of which Employee is a partner or
through any other individual or entity in which Employee has any interest, legal
or equitable), solicit or otherwise engage with any customers or clients of
SPSS, in any transactions which are in direct competition with the software
business of SPSS which SPSS did or could have engaged in with those customers or
clients, or (iii) directly or indirectly (whether through a partnership of which
Employee is a partner or through any other individual or entity in which
Employee has any interest, legal or equitable), assist any person in the
development, programming, servicing, maintenance, manufacture, sale, licensing,
distribution or marketing (including, without limitation, giving away software)
of software and related products in competition with SPSS' products, in each
case in the United States of America or any country where SPSS, or its
subsidiaries or affiliates are doing business with respect to SPSS products and
services and in each case excluding passive investment interests of less than
two percent (2%) in corporations whose stock is registered under the Securities
Exchange Act of 1934, as amended.
(b) Employee understands that a breach by him of this Section 5 may cause
substantial injury to SPSS, which may be irreparable and/or in amounts difficult
or impossible to ascertain, and that in the event Employee breaches this Section
5, SPSS shall have, in addition to all other remedies available in the event of
a breach of this Agreement, the right to injunctive or other equitable relief.
Further, Employee acknowledges and agrees that the restrictions and commitments
set forth in this Agreement are necessary to protect SPSS' legitimate interests
and are reasonable in scope, area and time, and that if, despite this
acknowledgment and agreement, at the time of the enforcement of any provision of
this Agreement a court of competent jurisdiction shall hold that the period or
scope of such provision is unreasonable under the circumstances then existing,
the maximum reasonable period or scope under such circumstances shall be
substituted for the period or scope stated in such provision.
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(c) Should Employee breach this Section 5, all severance payments shall
cease immediately, and SPSS shall be entitled to pursue all other available
legal or equitable remedies.
(d) For purposes of Section 5, where the context admits, the term "SPSS"
includes SPSS Inc., its subsidiaries and all of their respective affiliated
entities and their successors and assigns.
6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois applicable to agreements made
and to be performed in Illinois, without giving effect to conflicts of law
principles.
7. Headings. The section headings of this Agreement are for reference only
and are to be given no effect in the construction or interpretation of this
Agreement. 8. Severability. If any part or provision of this Agreement shall be
declared invalid or unenforceable by a court of competent jurisdiction, said
provision or part shall be ineffective to the extent of such invalidity or
unenforceability only, without in any way affecting the remaining parts or
provisions of this Agreement.
9. Waiver. Any party may waive compliance by another party with any of the
provisions of this Agreement. No waiver of any provision shall be construed as a
waiver of any other provision. Any waiver must be in writing.
10. Binding Effect; Assignment. This Agreement shall be binding on and
inure to the benefit of the parties and their respective successors and
permitted assigns. Nothing in this Agreement shall create or be deemed to create
any third party beneficiary rights in any person or entity (including any
employee or person engaged by SPSS in any capacity) not a party to this
Agreement. SPSS will require any successor (whether direct or indirect, by
merger, purchase, consolidation or otherwise) of SPSS to make an express
assumption of the obligations hereunder and cause any successor (whether direct
or indirect, by merger, purchase, consolidation or otherwise) of SPSS to agree
to perform all parts and provisions under this Agreement in the same manner and
to the same extent that SPSS would be required to perform it if no such
succession had taken place.
11. Counterparts. This Agreement may be signed in any number of
counterparts and all such counterparts shall be read together and construed as
but one and the same document.
12. Notices. All notices and other communications under this Agreement
shall be in writing and shall be deemed given when delivered personally, one day
after sent by recognized overnight courier, or five (5) days after deposit in
the United States mail, postage prepaid, registered or certified mail, return
receipt requested, to the parties at the following addresses (or to such other
address as a party may have specified by notice duly given to the other party in
accordance with this provision):
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If to the Employee:
At the Employee's then current business or residence address as shown on
the records of SPSS, with a copy to such other person as the Employee may have
specified by notice duly given to SPSS in accordance with this provision.
If to SPSS:
SPSS Inc.
000 X. Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chairman
With a copy to:
Xxxx & Xxxxxxx
000 X. Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
IN WITNESS WHEREOF the parties have executed this Agreement on the date
first written above.
Employee
/s/XXXX XXXXXX
Xxxx Xxxxxx
SPSS Inc.
By:/s/XXXXXX XXX
Name: Xxxxxx Xxx
Its: Chairman
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