Exhibit 10.5

 

LOGO [g556778g02l56.jpg]    Serena Software, Inc.

June 20, 2013

Greg Hughes

c/o Serena Software, Inc.

1850 Gateway Drive, 4th Floor

San Mateo CA 94404

Dear Greg:

We are pleased to inform you that the board of directors (“Board”) of Serena
Software, Inc. (“Serena”) has approved the following modifications to your
original offer letter of employment with Serena.

You will be eligible to receive an annual cash incentive bonus based on an
annual target bonus equal to 100% of your base salary for a period of twelve
(12) months. For fiscal year 2014, the annual cash incentive plan is governed by
the terms of the FY 2014 Executive Annual Incentive Plan. Your actual bonus
payout will be subject to the achievement of our annual EBITA (earnings before
interest, taxes and amortization) target under our fiscal year 2014 operating
plan as revised on June 5, 2013. Achievement of less than 95% of the EBITA
target will result in no payout, achievement of 95% of the EBITA target will
result in a 50% payout, achievement of 100% of the EBITA target will result in a
100% payout and achievement of 105% of the EBITA target will result in a 150%
payout of the applicable target bonus amount. Bonus payouts are capped at 150%
of your applicable target bonus. For fiscal year 2014, your applicable target
bonus will be $375,000, which reflects a proration of your annual target bonus
based on your expected period of service during the fiscal year. If a Change in
Control should occur prior to the end of fiscal year 2014 and you are employed
by Serena immediately prior to the Change in Control, Serena will pay you 100%
of your target bonus under the FY2014 Executive Annual Incentive Plan
immediately prior to the Change in Control.

You will be granted 250,000 additional restricted stock units under Serena’s
Amended and Restated 2006 Stock Incentive Plan (“Stock Plan”) pursuant to the
terms of Serena’s standard Restricted Stock Unit Agreement (Retention Award).
Subject to your continued employment on the applicable vesting event, 100% of
the restricted stock units will vest upon the first to occur of (a) the 3rd
anniversary of the date of grant, (b) a Change in Control, or (c) an Initial
Public Offering. If the vesting event is a Change in Control, each restricted
stock unit that you hold, including all restricted stock units that were
previously awarded to you and unvested as of the date of this letter, will be
cancelled immediately prior to such Change in Control in consideration for a
payment equal to the per share consideration received by the holders of the
Serena’s common stock in such Change in

 

 

1850 Gateway Drive, 4th Floor San Mateo California 94404    T 650.481.3400 F
650.481.3700 www.serena.com   

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Greg Hughes

June 20, 2013

 

Control; provided, that the aggregate payment that you will be entitled to
receive with respect to the cancellation of all of your restricted stock units
in such Change in Control will not be more than $1,250,000. The aggregate
payment to be made in consideration of the cancellation of your restricted stock
units in connection with a Change in Control will be subject to the same terms
and conditions as apply to the payment of the per share consideration made to
holders of Serena common stock, including any indemnity escrow or earn out
provisions, and shall be made net of all required taxes and withholdings.

In addition, Serena shall set aside a discretionary bonus pool through which
additional awards may be granted by the compensation committee of the Board of
Directors at the time of a Change in Control. You will be eligible to
participate in this discretionary pool, with the amount of any such award to be
determined by the compensation committee in its sole discretion and, if
applicable, paid to you by Serena at or immediately prior to the Change in
Control.

Silver Lake Partners and Serena shall use commercially reasonable best efforts
to obtain stockholder approval in accordance with the terms of Section 280G of
the Internal Revenue Code in connection with any “change in ownership or
effective control” of Serena or any “change in the ownership of a substantial
portion of the assets of Serena” prior to or at a Change in Control.

For purpose of this letter, the terms “Cause,” “Good Reason” and “Change in
Control” are defined in the Stock Plan.

Employment with Serena is on an at-will basis. You are free to terminate your
employment for any reason at any time with or without prior notice. Similarly,
Serena can terminate your employment relationship with or without cause or
notice.

This letter modifies the terms of your original offer of employment with Serena,
and supersedes any previous verbal commitments. The terms of this letter may
only be changed by written amendment to this letter.

 

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Greg Hughes

June 20, 2013

 

Your experience and talents are important to our company. Please call me with
any questions you may have.

Sincerely,

 

/s/ Karen King Karen M. King Director of Serena Software, Inc. and

Managing Director of Silver Lake Technology Associates II, L.L.C.,

as General Partner of Silver Lake Partners II, L.P.

 

Accepted:  

/s/ Greg Hughes

  Greg Hughes Date:  

June 20, 2013

 

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