Exhibit 10.29

 

ASPEN TECHNOLOGY, INC.

 

Amended and Restated Executive Retention Agreement

 

Aspen Technology, Inc., a Delaware corporation (the “Company”), and [Name of
executive] (the “Executive”) enter into this Amended and Restated Executive
Retention Agreement (the “Agreement”) dated as of July      , 2014 (the
“Effective Date”).

 

WHEREAS, the Company and the Executive are currently party to an Amended and
Restated Executive Retention Agreement, dated July 31, 2009 (the “Current
Agreement”);

 

WHEREAS, the parties desire to further amend and restate the Current Agreement
as of the date hereof;

 

WHEREAS, the Company considers the establishment and maintenance of a sound and
vital management to be essential to protecting and enhancing the best interests
of the Company and its stockholders;

 

WHEREAS, the Company recognizes that, as is the case with many publicly-held
corporations, the possibility of a change in control of the Company exists and
that such possibility, and the uncertainty and questions which it may raise
among key personnel, may result in the departure or distraction of key personnel
to the detriment of the Company and its stockholders, and

 

WHEREAS, the Board of Directors of the Company (the “Board”) has determined that
it is in the best interests of the Company that appropriate steps should be
taken to reinforce and encourage the continued employment and dedication of the
Company’s key personnel without distraction, including distraction from the
possibility of a change in control of the Company and related events and
circumstances.

 

NOW, THEREFORE, as an inducement for and in consideration of the Executive
remaining in its employ and for other good and valuable consideration, the
parties agree that the Executive shall receive the severance benefits set forth
set forth below in the event the Executive’s employment with the Company is
terminated.

 

1.                      Key Definitions.  As used herein, the following terms
shall have the following respective meanings:

 

1.1               “Change in Control” means an event or occurrence set forth in
any one or more of subsections (a) through (d) below (including an event or
occurrence that constitutes a Change in Control under one of such subsections
but is specifically exempted from another such subsection) and that is (i) a
change in the ownership of the Company (as defined in Treasury Regulation
Section 1.409A-3(i)(5)(v)), (ii) a change in effective control of the Company
(as defined in Treasury Regulation Section 1.409A-3(i)(5)(vi)), or (iii) a
change in the ownership of a substantial portion of the assets of the Company
(as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)):

 

(a)                 the acquisition by an individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934) (a “Person”) of beneficial ownership of any capital stock of the Company
if, after such acquisition, such Person beneficially owns (within the meaning of
Rule 13d-3 promulgated under the Securities Exchange Act of 1934) 50% or more of
either (x) the then-outstanding shares of common stock of the Company (the
“Outstanding Company Common Stock”) or (y) the combined voting power of the

 

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then-outstanding securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting Securities”); provided
that for purposes of this subsection (1), the following acquisitions shall not
constitute a Change in Control:  (I) any acquisition directly from the Company
(excluding an acquisition pursuant to the exercise, conversion or exchange of
any security exercisable for, convertible into or exchangeable for common stock
or voting securities of the Company, unless the Person exercising, converting or
exchanging such security acquired such security directly from the Company or an
underwriter or agent of the Company), (II) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, (III) any acquisition by any corporation
pursuant to a Business Combination (as defined below) that complies with clauses
(x) and (y) of Section 1.1(c) or (IV) any acquisition by the Company; or

 

(b)                 such time as the Continuing Directors (as defined below) do
not constitute a majority of the Board (or, if applicable, the Board of
Directors of a successor corporation to the Company), where the term “Continuing
Director” means at any date a member of the Board (x) who was a member of the
Board on the date of the execution of this Agreement or (y) who was nominated or
elected subsequent to such date by at least a majority of the directors who were
Continuing Directors at the time of such nomination or election or whose
election to the Board was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election, provided that there shall be excluded from this clause (y) any
individual whose initial assumption of office occurred as a result of an actual
or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents, by
or on behalf of a person other than the Board; or

 

(c)                  the consummation of a merger, consolidation,
reorganization, recapitalization or share exchange involving the Company or a
sale or other disposition of all or substantially all of the assets of the
Company in one or a series of transactions (a “Business Combination”), unless,
immediately following such Business Combination, each of the following two
conditions is satisfied:  (x) all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company Common Stock
and Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
directors, respectively, of the resulting or acquiring corporation in such
Business Combination (which shall include a corporation that as a result of such
transaction owns the Company or substantially all of the Company’s assets either
directly or through one or more subsidiaries) (such resulting or acquiring
corporation is referred to herein as the “Acquiring Corporation”) in
substantially the same proportions as their ownership of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, respectively,
immediately prior to such Business Combination, excluding for all purposes of
this clause (x) any shares of common stock or other securities of the Acquiring
Corporation attributable to any such individual’s or entity’s ownership of
securities other than Outstanding Company Common Stock or Outstanding Company
Voting Securities immediately prior to the Business Combination); and (y) no
Person (excluding the Acquiring Corporation or any employee benefit plan (or
related trust)

 

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maintained or sponsored by the Company or by the Acquiring Corporation)
beneficially owns, directly or indirectly, 50% or more of the then-outstanding
shares of common stock of the Acquiring Corporation, or of the combined voting
power of the then-outstanding securities of such corporation entitled to vote
generally in the election of directors (except to the extent that such ownership
existed prior to the Business Combination); or

 

(d)                 approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

 

1.2               “Change in Control Date” means the first date during the Term
(as defined in Section 2) on which a Change in Control occurs.  Anything in this
Agreement to the contrary notwithstanding, if (a) a Change in Control occurs, or
shall have been announced or agreed to, (b)  the Executive’s employment with the
Company is subsequently terminated, and (c) if the date of termination is prior
to the date of the actual or scheduled Change of Control and it is reasonably
demonstrated by the Executive that such termination of employment (i) was at the
request of a third party who has taken steps reasonably designed to effect a
Change in Control or (ii) otherwise arose in connection with or in anticipation
of a Change in Control, such as, for example, as a condition thereto or in
connection with cost reduction or elimination of duplicate positions, then for
all purposes of this Agreement the “Change in Control Date” shall mean the date
immediately prior to the date of such termination of employment.

 

1.3               “Cause” means:

 

(a)                 the Executive’s willful and continued failure to
substantially perform the Executive’s reasonable assigned duties (other than any
such failure resulting from incapacity due to physical or mental illness,
approved leave of absence or any failure after the Executive gives notice of
termination for Good Reason), which failure is not cured within 30 days after a
written notice and demand for substantial performance is received by the
Executive from the Board of Directors of the Company which specifically
identifies the manner in which the Board of Directors believes the Executive has
not substantially performed the Executive’s duties; or

 

(b)                 the Executive’s willful engagement in illegal conduct or
gross misconduct which is materially and demonstrably injurious to the Company.

 

For purposes of this Section 1.3, no act or failure to act by the Executive
shall be considered “willful” unless it is done, or omitted to be done, in bad
faith and without reasonable belief that the Executive’s action or omission was
in the best interests of the Company.

 

1.4               “Good Reason” means the occurrence, without the Executive’s
prior written consent, of any of the events or circumstances set forth in
clauses (a) through (h) below.

 

(a)                 a material diminution in the Executive’s authority, duties,
responsibilities or reporting requirements in effect immediately prior to the
earliest to occur of (i) the Change in Control Date, (ii) the date of the
execution by the Company of the initial written agreement or instrument
providing for the Change in Control or (iii) the date of the adoption by the
Board of Directors of a resolution providing for the Change in Control (with the
earliest to occur of such dates referred to herein as the “Measurement Date”),
or any other action or omission by the Company which results in a material
diminution in such position, authority or responsibilities;

 

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(b)                 a reduction in the Executive’s annual base salary as in
effect on the Measurement Date or as the same was or may be increased thereafter
from time to time;

 

(c)                  the failure by the Company to (i) continue in effect any
material compensation or benefit plan or program (including without limitation
any life insurance, medical, health and accident or disability plan and any
vacation program or policy) (a “Benefit Plan”) in which the Executive
participates or which is applicable to the Executive immediately prior to the
Measurement Date, unless an equitable arrangement (embodied in an ongoing
substitute or alternative plan) has been made with respect to such plan or
program, (ii) continue the Executive’s participation therein (or in such
substitute or alternative plan) on a basis not materially less favorable, both
in terms of the amount of benefits provided and the level of the Executive’s
participation relative to other participants, than the basis existing
immediately prior to the Measurement Date or (iii) award cash bonuses to the
Executive in amounts and in a manner substantially consistent with past practice
in light of the Company’s financial performance;

 

(d)                 a change by the Company in the location at which the
Executive performs the Executive’s principal duties for the Company to a new
location that is both (i) outside a radius of 40 miles from the Executive’s
principal residence immediately prior to the Measurement Date and (ii) more than
30 miles from the location at which the Executive performed the Executive’s
principal duties for the Company immediately prior to the Measurement Date; or a
requirement by the Company that the Executive travel on Company business to a
substantially greater extent than required immediately prior to the Measurement
Date;

 

(e)                  the failure of the Company to obtain the agreement from any
successor to the Company to assume and agree to perform this Agreement, as
required by Section 6.1;

 

(f)                   a purported termination of the Executive’s employment
which is not effected pursuant to a Notice of Termination satisfying the
requirements of Section 3;

 

(g)                  any failure of the Company to pay or provide to the
Executive any portion of the Executive’s compensation or benefits due under any
Benefit Plan within seven days of the date such compensation or benefits are
due, or any material breach by the Company of this Agreement or any employment
agreement with the Executive; or

 

(h)                 any other material breach by the Company of any of its
obligations under this Agreement.

 

1.5               “Disability” means the Executive’s absence from the full-time
performance of the Executive’s duties with the Company for 180 consecutive
calendar days as a result of incapacity due to mental or physical illness which
is determined to be total and permanent by a physician selected by the Company
or its insurers and acceptable to the Executive or the Executive’s legal
representative.

 

2.                      Term of Agreement.  This Agreement shall take effect
upon the Effective Date and shall expire upon the first to occur of (a) the
expiration of the Term (as defined below) if a Change in Control has not
occurred during the Term, (b) the date 12 months after the Change in Control
Date, if the Executive is still employed by the Company as of such later date,
or (c) the fulfillment by the Company of all of its obligations under
Sections 4, 5.2 and 5.3 if the Executive’s employment with the Company
terminates during the Term or within 12 months following the Change in Control
Date.  “Term” shall mean the

 

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period commencing as of the Effective Date and continuing in effect through
July 31, 2015; provided, however, that commencing on August 1, 2015 and each
August 1 thereafter, the Term shall be automatically extended for one additional
year unless, not later than six months prior to the scheduled expiration of the
Term (or any extension thereof), the Company shall have given the Executive
written notice that the Term will not be extended.

 

3.                      Notice of Termination.

 

3.1               Any termination of the Executive’s employment by the Company
or by the Executive (other than due to the death of the Executive) shall be
communicated by a written notice to the other party hereto (the “Notice of
Termination”), given in accordance with Section 7.  Any Notice of Termination
shall: (i) indicate the specific termination provision (if any) of this
Agreement relied upon by the party giving such notice, (ii) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive’s employment under the
provision so indicated and (iii) specify the Date of Termination (as defined
below).  The effective date of an employment termination (the “Date of
Termination”) shall be the close of business on the date specified in the Notice
of Termination (which date may not be less than 30 days or more than 120 days
after the date of delivery of such Notice of Termination), in the case of a
termination other than one due to the Executive’s death, or the date of the
Executive’s death, as the case may be.  In the event the Company fails to
satisfy the requirements of Section 3 regarding delivery of a Notice of
Termination, the purported termination of the Executive’s employment pursuant to
such Notice of Termination shall not be effective for purposes of this
Agreement.

 

3.2               The failure by the Executive or the Company to set forth in
the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the Executive or
the Company, respectively, hereunder or preclude the Executive or the Company,
respectively, from asserting any such fact or circumstance in enforcing the
Executive’s or the Company’s rights hereunder.

 

3.3               Any Notice of Termination for Cause given by the Company must
be given within 30 days of the occurrence of the event(s) or
circumstance(s) which constitute(s) Cause.  Prior to any Notice of Termination
for Cause being given (and prior to any termination for Cause being effective),
the Executive shall be entitled to a hearing before the Board of Directors of
the Company at which the Executive may, at the Executive’s election, be
represented by counsel and at which the Executive shall have a reasonable
opportunity to be heard.  Such hearing shall be held on not less than 15 days’
prior written notice to the Executive stating the Board of Directors’ intention
to terminate the Executive for Cause and stating in detail the particular
event(s) or circumstance(s) which the Board of Directors believes constitutes
Cause for termination.  Any such Notice of Termination for Cause must be
approved by an affirmative vote of at least two-thirds of the members of the
Board of Directors.

 

3.4               Any Notice of Termination for Good Reason given by the
Executive must be given within 30 days of the occurrence of the event(s) or
circumstance(s) that constitute(s) Good Reason.  The Executive shall cooperate
in good faith with the Company, during the period from the date of delivery of
such Notice of Termination to the Date of Termination specified in such Notice
of Termination, to correct each of such events and circumstances. 
Notwithstanding the occurrence of any such event or circumstance, such
occurrence shall not be deemed to constitute Good Reason if, prior to the Date
of Termination specified in such Notice of Termination, each such event or
circumstance has been fully corrected and the Executive has been reasonably
compensated for any losses or damages resulting therefrom.  The Executive’s
right to terminate the Executive’s employment for Good Reason shall not be
affected by the Executive’s incapacity due to physical or mental illness.

 

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4.                      Termination; Benefits to Executive.

 

4.1               Termination Not Related to a Change in Control.  Subject to
Sections 4.5 and 8.1, if the Executive’s employment with the Company is
terminated by the Company without Cause and a Change in Control Date has not
occurred, then, provided that the Executive has delivered to the Company (and
the applicable revocation period has expired with respect to) a signed general
release substantially in the form attached hereto as Exhibit A (the “Release”)
during the 60 days following the Date of Termination, the Executive shall be
entitled to payments and benefits set forth below.  Unless delayed by
Section 4.5 or not payable under Section 8.1, the payments will begin (or for
lump sums will be made) in the first payroll period after the Release becomes
irrevocable, provided that if the sixtieth day falls in the calendar year
following the year of the Date of Termination, the payments will begin (or be
made) no earlier than the first payroll period of such later calendar year.  The
first payroll payment will include a make-up payment for the period that elapsed
between the Date of Termination and the payroll period in which payments begin.

 

(a)                 For the 12 months following the Date of Termination (the
“Severance Period”), the Company shall pay to the Executive (i) an amount equal
to Executive’s then-current base salary, to be paid on the Company’s normal
payroll cycle during the Severance Period and (ii) an amount equal to the pro
rata portion of the Executive’s target bonus for the then-current fiscal year,
to be paid in equal installments (subject to rounding) with the amounts paid
pursuant to the preceding clause (i); provided that if any payments would
otherwise be due on or after March 15 of the calendar year next succeeding the
year in which termination occurs, then all payments that would otherwise be due
after March 15 shall be paid to the Executive in a lump sum in the payroll
period on or immediately prior to March 15 of such next succeeding year.

 

(b)                 For the Severance Period or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy, the
Company shall continue to pay or provide benefits to the Executive and the
Executive’s family at least equal to those which would have been provided to
them if the Executive’s employment had not been terminated, in accordance with
the applicable medical, dental and vision plans (the “Benefit Plans”) in effect
on the Date of Termination or, if more favorable to the Executive and the
Executive’s family, in effect generally at any time thereafter with respect to
other peer executives of the Company and its affiliated companies
(notwithstanding the foregoing, to the extent such payments or benefits are
taxable and extend beyond the period of time during which the Executive would be
entitled (or would, but for such arrangement, be entitled) to COBRA continuation
coverage under a group health plan of the Company, the Company shall pay to the
Executive on a monthly basis an amount equal to the applicable COBRA premium for
such coverage).

 

(c)                  The Company shall pay to the Executive in a lump sum, in
cash, in lieu of any further life, disability, and accident insurance benefits
(not including medical, dental or vision insurance) (the “Other Plans”), an
amount equal to the cost to the Executive of providing such benefits (based on
the applicable premiums charged to the Company for such coverage under the Other
Plans), to the extent that the Executive is eligible to receive such benefits
immediately prior to the Notice of Termination, for the Severance Period.

 

(d)                 To the extent not previously paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
following the Executive’s termination of employment under any plan, program,
policy, practice, contract or agreement of the Company and its affiliated
companies, including any compensation previously deferred by the Executive
(together with any accrued interest or earnings thereon) and any accrued
vacation pay.

 

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(e)                  For purposes of determining eligibility (but not the time
of commencement of benefits) of the Executive for defined benefit
pension/retiree benefits, if any,  to which the Executive is entitled, the
Executive shall be considered to have remained employed by the Company through
the Severance Period.  For the avoidance of doubt, the foregoing shall not be
deemed to include a 401(k) Plan or similar benefit.

 

(f)                   The Company shall provide outplacement services through
one or more outside firms of the Executive’s choosing and reasonably acceptable
to the Company up to an aggregate of $45,000, with such services to extend until
the earlier of (i) 12 months following the termination of Executive’s employment
or (ii) the date the Executive secures full time employment.

 

4.2               Termination Related to a Change in Control.  Subject to
Sections 4.5 and 8.1, if a Change in Control Date occurs and the Executive’s
employment with the Company terminates within 12 months following the Change in
Control Date, the following provisions shall apply:

 

(a)                 Termination Without Cause or for Good Reason.  If the
Executive’s employment with the Company is terminated by the Company (other than
for Cause, Disability or death) or by the Executive for Good Reason within
12 months following the Change in Control Date, then, provided that Executive
has delivered to the Company (and the applicable revocation period has expired
with respect to) the Release within 60 days of the Date of Termination, the
Executive shall be entitled to the following payments and benefits paid on the
same timing described in Section 4.1:

 

(i)                    The Company shall pay to the Executive in a lump sum, in
cash, the aggregate of the following amounts:

 

(A)               the sum of (1) the Executive’s base salary through the Date of
Termination, and (2) any accrued vacation pay, in each case to the extent not
previously paid;

 

(B)               the sum of (1) 1.0 multiplied by the Executive’s annual base
salary, and (2) the higher of the Executive’s target bonus for the then-prior
fiscal year or the Executive’s target bonus for the then-current fiscal year;
provided, however, that if the Date of Termination is prior to the closing of
the Change in Control, then the amount set forth in this
Section 4.2(a)(i)(B)(1) shall be paid on the same schedule as set forth in
Section 4.1(a) and the amount set forth in Section 4.2(a)(i)(B)(2) shall be paid
on the same schedule as the amount set forth in Section 4.1(c)(i); and

 

(C)               in lieu of any further benefits under Other Plans, an amount
equal to the cost to the Executive of providing such benefits (based on the
applicable premiums charged to the Company for such coverage under the Other
Plans), to the extent that the Executive is eligible to receive such benefits
immediately prior to the Notice of Termination, for the Severance Period.

 

(ii)                 For the Severance Period, or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy, the
Company shall continue to pay or provide benefits to the Executive and the
Executive’s family at least equal to those which would have been provided to
them if the Executive’s employment had not been terminated, in accordance with
the applicable Benefit Plans in effect on the Measurement Date or, if more

 

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favorable to the Executive and the Executive’s family, in effect generally at
any time thereafter with respect to other peer executives of the Company and its
affiliated companies (notwithstanding the foregoing, to the extent such payments
are taxable and extend beyond the period of time during which the Executive
would be entitled (or would, but for such arrangement, be entitled) to COBRA
continuation coverage under a group health plan of the Company, the Company
shall pay to the Executive on a monthly basis an amount equal to the applicable
COBRA premium for such coverage).

 

(iii)              To the extent not previously paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
following the Executive’s termination of employment under any plan, program,
policy, practice, contract or agreement of the Company and its affiliated
companies.

 

(iv)             For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for defined benefit pension/retiree
benefits, if any,  to which the Executive is entitled, the Executive shall be
considered to have remained employed by the Company through the Severance
Period. For the avoidance of doubt, the foregoing shall not be deemed to include
a 401(k) Plan or similar benefit.

 

(v)                With respect to the Executive’s equity-based awards, (1) all
of the then-unvested options to purchase shares of stock of the Company held by
the Executive shall become fully vested and immediately exercisable in full, and
shares of the Company received upon exercise of any options will no longer be
subject to a right of repurchase by the Company, (2) all of the restricted stock
then otherwise subject to repurchase by the Company shall be deemed to be fully
vested (i.e., no longer subject to a right of repurchase or restriction by the
Company), (3) all of the shares underlying restricted stock units then otherwise
subject to future grant or award shall be fully granted, vested and distributed
and no longer subject to a right of repurchase by the Company or to any other
performance conditions, and (4) all then-vested and exercisable options
(including for the avoidance of doubt the options becoming exerciseable pursuant
to this paragraph) shall continue to be exercisable by the Executive for the
Severance Period (but not later than the original expiration date of such
options).

 

(vi)             The Company shall provide outplacement services through one or
more outside firms of the Executive’s choosing and reasonably acceptable to the
Company up to an aggregate of $45,000, with such services to extend until the
earlier of (i) 12 months following the termination of Executive’s employment or
(ii) the date the Executive secures full time employment.

 

(b)                 Resignation without Good Reason; Termination for Death or
Disability.  If the Executive voluntarily terminates the Executive’s employment
with the Company within 12 months following the Change in Control Date,
excluding a termination for Good Reason, or if the Executive’s employment with
the Company is terminated by reason of the Executive’s death or Disability
within 12 months following the Change in Control Date, then the Executive (or
the Executive’s estate, if applicable) shall be entitled to the following
payments and benefits:

 

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(i)                    The Company shall pay the Executive (or the Executive’s
estate, if applicable), in a lump sum, in cash, within 60 days after the Date of
Termination, the sum of (A) the Executive’s base salary through the Date of
Termination, and (B) any accrued vacation pay, in each case to the extent not
previously paid; and

 

(ii)                 To the extent not previously paid or provided, the Company
shall timely pay or provide to the Executive (or the Executive’s estate, if
applicable) any other amounts or benefits required to be paid or provided or
which the Executive is eligible to receive following the Executive’s termination
of employment under any plan, program, policy, practice, contract or agreement
of the Company and its affiliated companies, including any compensation
previously deferred by the Executive (together with any accrued interest or
earnings thereon).

 

(c)                  Termination for Cause.  If the Company terminates the
Executive’s employment with the Company for Cause within 12 months following the
Change in Control Date, then the Executive shall be entitled to the following
payments and benefits:

 

(i)                    the Company shall pay the Executive, in a lump sum, in
cash, within 60 days after the Date of Termination, the Executive’s base salary
through the Date of Termination, to the extent not previously paid; and

 

(ii)                 to the extent not previously paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
following the Executive’s termination of employment under any plan, program,
policy, practice, contract or agreement of the Company and its affiliated
companies.

 

4.3               Taxes.

 

(a)                 Notwithstanding any other provision of this Agreement,
except as set forth in Section 4.3(b), in the event that the Company undergoes a
“Change in Ownership or Control” (as defined below), the Company shall not be
obligated to provide to the Executive a portion of any “Contingent Compensation
Payments” (as defined below) that the Executive would otherwise be entitled to
receive to the extent necessary to eliminate any “excess parachute payments” (as
defined in Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended
(the “Code”)) for the Executive.  For purposes of this Section 4.3, the
Contingent Compensation Payments so eliminated shall be referred to as the
“Eliminated Payments” and the aggregate amount determined in accordance with
Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision) of the
Contingent Compensation Payments so eliminated shall be referred to as the
“Eliminated Amount.”

 

(b)                 Notwithstanding the provisions of Section 4.3(a), no such
reduction in Contingent Compensation Payments shall be made if (i) the
Eliminated Amount (computed without regard to this sentence) exceeds (ii) 110%
of the aggregate present value (determined in accordance with Treasury
Regulation Section 1.280G-1, Q/A-31 and Q/A-32 or any successor provisions) of
the amount of any additional taxes that would be incurred by the Executive if
the Eliminated Payments (determined without regard to this sentence) were paid
to the Executive (including, state and federal income taxes on the Eliminated
Payments, the excise tax imposed by Section 4999 of the Code payable with
respect to all of the Contingent Compensation Payments in excess of the
Executive’s “base amount” (as defined in Section 280G(b)(3) of the Code), and
any withholding taxes).  The override of such reduction in Contingent
Compensation Payments pursuant to this Section 4.3(b) shall be referred to as a
“Section 4.3(b) Override.”  For purpose of this paragraph, if any federal or
state income taxes would be

 

9

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attributable to the receipt of any Eliminated Payment, the amount of such taxes
shall be computed by multiplying the amount of the Eliminated Payment by the
maximum combined federal and state income tax rate provided by law.

 

(c)                  For purposes of this Section 4.3 the following terms shall
have the following respective meanings:

 

(i)                    “Change in Ownership or Control” shall mean a change in
the ownership or effective control of the Company or in the ownership of a
substantial portion of the assets of the Company determined in accordance with
Section 280G(b)(2) of the Code.

 

(ii)                 “Contingent Compensation Payment” shall mean any payment
(or benefit) in the nature of compensation that is made or made available (under
this Agreement or otherwise) to a “disqualified individual” (as defined in
Section 280G(c) of the Code) and that is contingent (within the meaning of
Section 280G(b)(2)(A)(i) of the Code) on a Change in Ownership or Control of the
Company.

 

(d)                 Any payments or other benefits otherwise due to the
Executive following a Change in Ownership or Control that could reasonably be
characterized (as determined by the Company) as Contingent Compensation Payments
(the “Potential Payments”) shall not be made until the dates provided for in
this Section 4.3(d).  Within 10 days after each date on which the Executive
first becomes entitled to receive (whether or not then due) a Contingent
Compensation Payment relating to such Change in Ownership or Control, the
Company shall determine and notify the Executive (with reasonable detail
regarding the basis for its determinations) (i) which Potential Payments
constitute Contingent Compensation Payments, (ii) the Eliminated Amount and
(iii) whether the Section 4.3(b) Override is applicable.  Within 30 days after
delivery of such notice to the Executive, the Executive shall deliver a response
to the Company (the “Executive Response”) stating either (A) that the Executive
agrees with the Company’s determination pursuant to the preceding sentence, or
(B) that the Executive disagrees with such determination, in which case the
Executive shall set forth (i) which Potential Payments should be characterized
as Contingent Compensation Payments, (ii) the Eliminated Amount, and (iii)
whether the Section 4.3(b) Override is applicable.  To the extent any Contingent
Compensation Payments are required to be treated as Eliminated Payments pursuant
to this Section 4.3(d), then the Potential Payments shall be reduced or
eliminated, as determined by the Company, in the following order: (A) any cash
payments, (B) any taxable benefits, (C) any nontaxable benefits, and (D) any
vesting of equity awards, in each case in reverse order beginning with payments
or benefits that are to be paid the farthest in time from the date that triggers
the applicability of the excise tax, to the extent necessary to maximize the
Eliminated Payments.  If the Executive states in the Executive Response that the
Executive agrees with the Company’s determination, the Company shall make the
Potential Payments to the Executive within three business days following
delivery to the Company of the Executive Response (except for any Potential
Payments which are not due to be made until after such date, which Potential
Payments shall be made on the date on which they are due).  If the Executive
states in the Executive Response that the Executive disagrees with the Company’s
determination, then, for a period of 10 days following delivery of the Executive
Response, the Executive and the Company shall use good faith efforts to resolve
such dispute.  If such dispute is not resolved within such 10-day period, such
dispute shall be settled exclusively by arbitration in Boston, Massachusetts, in
accordance with the rules of the American Arbitration Association then in
effect.  Judgment may be entered on the arbitrator’s award in any court having
jurisdiction.  The Company shall, within three business days following delivery
to the Company of the Executive Response, make to the Executive those Potential
Payments as to which there is no dispute between the Company and the Executive
regarding whether they should be made (except for any such

 

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Potential Payments which are not due to be made until after such date, which
Potential Payments shall be made on the date on which they are due).  The
balance of the Potential Payments shall be made within three business days
following the resolution of such dispute.  Subject to the limitations contained
in Sections 4.3(a) and (b) hereof, the amount of any payments to be made to the
Executive following the resolution of such dispute shall be increased by the
amount of the accrued interest thereon computed as set forth in Section 5.2.

 

(e)                  The provisions of this Section 4.3 are intended to apply to
any and all payments or benefits available to the Executive under this Agreement
or any other agreement or plan of the Company under which the Executive receives
Contingent Compensation Payments.

 

4.4               Mitigation.  For the avoidance of doubt, the Executive shall
not be required to mitigate the amount of any payment or benefits provided for
in this Section 4 by seeking other employment or otherwise.  Further, subject to
Section 8.1, the amount of any payment or benefits provided for in this
Section 4 shall not be reduced by any compensation earned by the Executive as a
result of employment by another employer, by retirement benefits, by offset
against any amount claimed to be owed by the Executive to the Company or
otherwise.

 

4.5               Distributions.

 

(a)                 Subject to this Section 4.5 and Section 8.1, payments or
benefits under Section 4.1 or 4.2 shall begin only upon the date of Executive’s
“separation from service” (determined as set forth below) which occurs on or
after the Date of Termination.  The following rules shall apply with respect to
distribution of the payments and benefits, if any, to be provided to Executive
under Section 4.1 or 4.2, as applicable:

 

(i)                    It is intended that each installment of the payments and
benefits provided under Section 4.1 or 4.2 shall be treated as a separate
“payment” for purposes of Section 409A of the Code and the final Treasury
regulations and guidance issued thereunder (“Section 409A”).  Neither the
Company nor Executive shall have the right to accelerate or defer the delivery
of any such payments or benefits except to the extent specifically permitted or
required by Section 409A.

 

(ii)                 If, as of the date of Executive’s “separation from service”
from the Company, Executive is not a “specified employee” (each, for purposes of
the Agreement, within the meaning of Section 409A), then each installment of the
payments and benefits shall be made on the dates and terms set forth in
Section 4.1 or 4.2.

 

(iii)              If, as of the date of Executive’s separation from service
from the Company, Executive is a specified employee, then:

 

(A)               Each installment of the payments and benefits due under
Section 4.1 or 4.2 that, in accordance with the dates and terms set forth
herein, will in all circumstances, regardless of when Executive’s separation
from service occurs, be paid within the short-term deferral period (as defined
under Section 409A) and shall be treated as a short-term deferral within the
meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent
permissible under Section 409A.

 

(B)               Each installment of the payments and benefits due under
Section 4.1 or

 

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4.2 that is not described in Section 4.5(a)(iii)(A) and that would, absent
Section 4.5(a)(iii)(A), be paid within the six-month period following the
Executive’s separation from service from the Company shall not be paid until the
date that is six months and one day after such separation from service (or, if
earlier, the Executive’s death), with any such installments that are required to
be delayed being accumulated during the six-month period and paid in a lump sum
on the date that is six months and one day following the Executive’s separation
from service and any subsequent installments, if any, being paid in accordance
with the dates and terms set forth herein; provided, however, that the preceding
provisions of this Section 4.5(a)(iii)(B) shall not apply to any installment of
payments and benefits if and to the maximum extent that that such installment is
deemed to be paid under a separation pay plan that does not provide for a
deferral of compensation by reason of the application of Treasury Regulation
Section 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary
separation from service).  Any installments that qualify for the exception under
Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the
last day of the Executive’s second taxable year following the taxable year in
which the separation from service occurs.

 

(b)                 The determination of whether and when Executive’s separation
from service from the Company has occurred shall be made and in a manner
consistent with, and based on the presumptions set forth in, Treasury Regulation
Section 1.409A-1(h).  Solely for purposes of this Section 4.5(b), “Company”
shall include all persons with whom the Company would be considered a single
employer under Section 414(b) and 414(c) of the Code.

 

(c)                  All reimbursements and in-kind benefits provided under the
Agreement shall be made or provided in accordance with the requirements of
Section 409A to the extent that such reimbursements or in-kind benefits are
subject to Section 409A, including, where applicable, the requirements that
(i) any reimbursement is for expenses incurred during the Executive’s lifetime
(or during a shorter period of time specified in the Agreement), (ii) the amount
of expenses eligible for reimbursement during a calendar year may not affect the
expenses eligible for reimbursement in any other calendar year, (iii) the
reimbursement of an eligible expense will be made on or before the last day of
the calendar year following the year in which the expense is incurred and
(iv) the right to reimbursement is not subject to set off or liquidation or
exchange for any other benefit.

 

5.                      Disputes; Expenses.

 

5.1              Disputes.  All claims by the Executive for benefits under this
Agreement shall be directed to and determined by the Board of Directors of the
Company and shall be in writing.  Any rejection by the Board of Directors of a
claim for benefits under this Agreement shall be delivered to the Executive in
writing and shall set forth the specific reasons for the rejection and the
specific provisions of this Agreement relied upon.

 

5.2               Expenses.  Subject to Sections 4.5 and 8.1, the Company agrees
to pay as incurred, the expenses of one law firm to review and negotiate this
Agreement, and, to the fullest extent permitted by law, all legal, accounting
and other fees and expenses which the Executive may reasonably incur as a result
of any claim or contest (regardless of the outcome thereof) by the Company, the
Executive or others regarding the validity or enforceability of, or liability
under, any provision of this Agreement or any guarantee of performance thereof
(including as a result of any contest by the Executive regarding the

 

12

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amount of any payment or benefits pursuant to this Agreement), plus in each case
interest on any delayed payment at the applicable rate for prejudgment interest
then in effect in the Commonwealth of Massachusetts.

 

5.3               Compensation During a Dispute.  Subject to Sections 4.5 and
8.1, if rights of the Executive to receive benefits under Section 4 (or the
amount or nature of the benefits to which the Executive is entitled to
receive) are the subject of a dispute between the Company and the Executive, the
Company shall continue (a) to pay to the Executive the Executive’s base salary
in effect as of the Measurement Date and (b) to provide benefits to the
Executive and the Executive’s family at least equal to those which would have
been provided to them, if the Executive’s employment had not been terminated, in
accordance with the applicable Benefit Plans in effect on the Measurement Date,
until such dispute is resolved.  Following the resolution of such dispute, the
sum of the payments made to the Executive under clause (a) of this Section 5.3
shall be deducted from any cash payment which the Executive is entitled to
receive pursuant to Section 4; and if such sum exceeds the amount of the cash
payment which the Executive is entitled to receive pursuant to Section 4, the
excess of such sum over the amount of such payment shall be repaid (without
interest) by the Executive to the Company within 120 days of the resolution of
such dispute.

 

6.                      Successors.

 

6.1               Successor to Company.  The Company shall require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business or assets of the Company expressly to
assume and agree to perform this Agreement to the same extent that the Company
would be required to perform it if no such succession had taken place.  Failure
of the Company to obtain an assumption of this Agreement at or prior to the
effectiveness of any succession shall be a breach of this Agreement and shall
constitute Good Reason if the Executive elects to terminate employment, except
that for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Date of Termination.  As used
in this Agreement, “Company” shall mean the Company as defined above and any
successor to its business or assets as aforesaid which assumes and agrees to
perform this Agreement, by operation of law or otherwise.

 

6.2               Successor to Executive.  This Agreement shall inure to the
benefit of and be enforceable by the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.  If the Executive should die while any amount would still
be payable to the Executive or the Executive’s family hereunder if the Executive
had continued to live, all such amounts, unless otherwise provided herein, shall
be paid in accordance with the terms of this Agreement to the executors,
personal representatives or administrators of the Executive’s estate.

 

7.                      Notice.  All notices, instructions and other
communications given hereunder or in connection herewith shall be in writing. 
Any such notice, instruction or communication shall be sent either (i) by
registered or certified mail, return receipt requested, postage prepaid, or
(ii) prepaid via a reputable nationwide overnight courier service, in each case
addressed to the Company, at Aspen Technology, Inc.; ATTN: General Counsel; 200
Wheeler Road; Burlington, MA 01803, and to the Executive at the Executive’s
address indicated on the signature page of this Agreement (or to such other
address as either the Company or the Executive may have furnished to the other
in writing in accordance herewith).  Any such notice, instruction or
communication shall be deemed to have been delivered five business days after it
is sent by registered or certified mail, return receipt requested, postage
prepaid, or one business day after it is sent via a reputable nationwide
overnight courier service.  Either party may give any notice, instruction or
other communication hereunder using any other means, but no such notice,
instruction or other communication shall be deemed to have been duly delivered
unless and until it actually is received by the party for whom it is intended.

 

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8.                      Miscellaneous.

 

8.1               Non-Disclosure and Non-Competition and Non-Solicitation.  The
Executive acknowledges and reaffirms the Executive’s obligations with respect to
non-disclosure, non-competition, and non-solicitation (and any other
restrictions) reflected in the Proprietary and Confidential Information and
Non-Competition and Non-Solicitation Agreement dated as of [Date]. 
Notwithstanding any other provision of this Agreement, in the event the
Executive is deemed by the Company to have violated Section 3(a) of such
Proprietary and Confidential Information and Non-Competition and
Non-Solicitation Agreement, the Company shall provide notice to the Executive
and, upon the deemed delivery of such notice pursuant to Section 7, all amounts
payable or benefits to be provided by the Company under Section 4 shall no
longer be due and payable or required to be provided.

 

8.2               Section 409A of the Code. This Agreement is intended to comply
with the provisions of Section 409A and the Agreement shall, to the extent
practicable, be construed in accordance therewith.  Terms defined in the
Agreement shall have the meanings given such terms under Section 409A if and to
the extent required in order to comply with Section 409A.

 

8.3               Not an Employment Contract.  The Executive acknowledges that
this Agreement does not constitute a contract of employment or impose on the
Company any obligation to retain the Executive as an employee and that this
Agreement does not prevent the Executive from terminating employment at any
time.

 

8.4               Employment by Subsidiary.  For purposes of this Agreement, the
Executive’s employment with the Company shall not be deemed to have terminated
solely as a result of the Executive continuing to be employed by a wholly-owned
subsidiary of the Company.

 

8.5               Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.

 

8.6               Injunctive Relief.  The Company and the Executive agree that
any breach of this Agreement by the Company is likely to cause the Executive
substantial and irrevocable damage and therefore, in the event of any such
breach, in addition to such other remedies which may be available, the Executive
shall have the right to specific performance and injunctive relief.

 

8.7               Governing Law.  The validity, interpretation, construction and
performance of this Agreement shall be governed by the internal laws of the
Commonwealth of Massachusetts, without regard to conflicts of law principles.

 

8.8               Waivers.  No waiver by the Executive at any time of any breach
of, or compliance with, any provision of this Agreement to be performed by the
Company shall be deemed a waiver of that or any other provision at any
subsequent time.

 

8.9              Counterparts.  This Agreement may be executed in counterparts,
each of which shall be deemed to be an original but both of which together shall
constitute one and the same instrument.

 

8.10        Tax Withholding.  Any payments provided for hereunder shall be paid
net of any applicable tax withholding required under federal, state or local
law.

 

8.11        Entire Agreement.  Except as set forth in this Section 8.10, this
Agreement sets forth the entire agreement of the parties hereto in respect of
the subject matter contained herein and supersedes all prior agreements,
promises, covenants, arrangements, communications, representations or
warranties,

 

14

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whether oral or written, by any officer, employee or representative of any party
hereto in respect of the subject matter contained herein; and any prior
agreement of the parties hereto in respect of the subject matter contained
herein is hereby terminated and cancelled.  Notwithstanding the preceding
sentence, the agreement referenced in Section 8.1 shall remain in full force and
effect.

 

8.12        Amendments.  This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Executive.

 

8.13        Executive’s Acknowledgements.  The Executive acknowledges that the
Executive: (a) has read this Agreement; (b) has been represented in the
preparation, negotiation, and execution of this Agreement by legal counsel of
the Executive’s own choice or has voluntarily declined to seek such counsel;
(c) understands the terms and consequences of this Agreement; and
(d) understands that the law firm of K&L Gates LLP is acting as counsel to the
Company in connection with the transactions contemplated by this Agreement, and
is not acting as counsel for the Executive.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year set forth above.

 

 

ASPEN TECHNOLOGY, INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

Name: [Name of executive]

 

 

 

Address:

 

 

 

 

 

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Exhibit A

 

GENERAL RELEASE OF CLAIMS

 

This General Release of Claims (the “General Release”) is being executed by
[Name of executive] (the “Executive”), for and in consideration of certain
amounts payable under the Amended and Restated Executive Retention Agreement
(the “Agreement”) entered into between the Executive and Aspen Technology, Inc.
(the “Company”), dated as of July     , 2014.  The Executive agrees as follows:

 

The Executive, on behalf of the Executive and the Executive’s agents, heirs,
executors, administrators, successors and assigns, hereby fully, forever,
irrevocably and unconditionally releases, remises and discharges the Company,
its officers, directors, stockholders, corporate affiliates, subsidiaries,
parent companies, agents and employees (each in their individual and corporate
capacities) (hereinafter, the “Released Parties”) from any and all claims,
charges, complaints, demands, actions, causes of action, suits, rights, debts,
sums of money, costs, accounts, reckonings, covenants, contracts, agreements,
promises, doings, omissions, damages, executions, obligations, liabilities, and
expenses (including attorneys’ fees and costs), of every kind and nature that
the Executive ever had or now has against the Released Parties, including, but
not limited to, any and all claims arising out of or relating to the Executive’s
employment with and/or separation from the Company, including, but not limited
to, all claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §
2000e et seq., the Americans With Disabilities Act of 1990, 42 U.S.C. § 12101 et
seq., the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the
Family and Medical Leave Act, 29 U.S.C. § 2601 et seq., the Worker Adjustment
and Retraining Notification Act (“WARN”), 29 U.S.C. § 2101 et seq., Section 806
of the Corporate and Criminal Fraud Accountability Act of 2002, 18 U.S.C.
1514(A), the Rehabilitation Act of 1973, 29 U.S.C. § 701 et seq., the Fair
Credit Reporting Act, 15 U.S.C. § 1681 et seq., the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., Employee Order 11246,
and Employee Order 11141, all as amended; all claims arising out of the
Massachusetts Fair Employment Practices Act, M.G.L. c. 151B, § 1 et seq., the
Massachusetts Civil Rights Act, M.G.L. c. 12, §§ 11H and 11I, the Massachusetts
Equal Rights Act, M.G.L. c. 93, § 102 and M.G.L. c. 214, § 1C, the Massachusetts
Labor and Industries Act, M.G.L. c. 149, § 1 et seq., the Massachusetts Privacy
Act, M.G.L. c. 214, § 1B, and the Massachusetts Maternity Leave Act, M.G.L. c.
149, § 105D, all as amended; all common law claims including, but not limited
to, actions in defamation, intentional infliction of emotional distress,
misrepresentation, fraud, wrongful discharge, and breach of contract, all claims
to any non-vested ownership interest in the Company, contractual or otherwise,
and any claim or damage arising out of the Executive’s employment with and/or
separation from the Company (including a claim for retaliation) under any common
law theory or any federal, state or local statute or ordinance not expressly
referenced above; provided, however, that (a) nothing in this General Release
prevents the Executive from filing a charge with, cooperating with, or
participating in any proceeding before the Equal Employment Opportunity
Commission or a state fair employment practices agency (except that the
Executive acknowledges that the Executive may not be able to recover any
monetary benefits in connection with any such claim, charge or proceeding); and
(b) this General Release does not include (i) any right to vested benefits to
which the Executive may be entitled under any Company benefit plan; (ii) any
rights the Executive may have under the terms of this General Release; (iii) any
right to indemnification arising out of the Executive’s employment with the
Company pursuant to any policy of insurance maintained by the Company; and
(iv) any rights that the Executive has under the Agreement.

 

The Executive acknowledges that the Executive has been given at least 21 days to
consider this General Release, and that the Company advised the Executive to
consult with an attorney of the Executive’s own choosing prior to signing this
General Release. The Executive understands that the Executive may revoke this
General Release for a period of seven days after the Executive signs this
General Release by notifying the Company’s General Counsel, in writing, and the
General Release shall

 

16

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not be effective or enforceable until the expiration of this seven-day
revocation period.  The Executive understands and agrees that by entering into
this General Release, the Executive is waiving any and all rights or claims the
Executive might have under the Age Discrimination in Employment Act, as amended
by the Older Workers Benefits Protection Act, and that the Executive has
received consideration beyond that to which the Executive was previously
entitled.

 

IN WITNESS WHEREOF, the parties hereto have executed this General Release as of
the day and year set forth below.

 

 

ASPEN TECHNOLOGY, INC.

 

 

 

 

 

By:

 

 

 

Title:

 

 

 

Date:

 

 

 

 

[NAME OF EXECUTIVE]

 

 

 

 

 

 

 

Date:

 

 

17

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