Exhibit 10.23
SEVERANCE AGREEMENT
     THIS SEVERANCE AGREEMENT (this “Agreement”), dated as of November 28, 2005,
is made and entered by and between Novell, Inc., a Delaware corporation (the
“Company”), and Jeffrey M. Jaffe (the “Executive”).
WITNESSETH:
     WHEREAS, the Executive is a senior executive of the Company and is expected
to make major contributions to the short- and long-term profitability, growth
and financial strength of the Company;
     WHEREAS, the Board has determined that appropriate arrangements should be
taken to encourage the continued attention and dedication of Executive to his
assigned duties without distraction;
     WHEREAS, in consideration of the Executive’s employment with the Company,
the Company desires to provide Executive with certain compensation and benefits
set forth in this Agreement in order to ameliorate the financial and career
impact on Executive in the event the Executive’s employment with the Company is
terminated for a reason related to, or unrelated to, a Change in Control (as
defined below) of the Company;
     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter set forth and intending to be legally bound hereby,
the Company and the Executive agree as follows:
1. Certain Defined Terms. In addition to terms defined elsewhere herein, the
following terms have the following meanings when used in this Agreement with
initial capital letters:
     (a) “Base Pay” means the greater of (i) Executive’s annual base salary
rate, exclusive of bonuses, commissions and other Incentive Pay, as in effect
immediately preceding Executive’s Termination Date, or (ii) Executive’s highest
annual base salary rate, exclusive of bonuses, commissions and other Incentive
Pay, as in effect in any of the three (3) full calendar years preceding
Executive’s Termination Date.
     (b) “Board” means the Board of Directors of the Company.
     (c) “Cause”:
          (i) For purposes of Involuntary Termination Prior to a Change in
Control, means a determination by the Company’s Chief Executive Officer or
Senior Vice President-People, in either case with legal advice and consultation
of the

 

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Company’s Senior Vice President — General Counsel, acting in his authority as
the Company’s general counsel, that Executive has committed any of the following
acts:
               (A) continued violations of the Executive’s obligations which are
demonstrably willful or deliberate on the Executive’s part after there has been
delivered to the Executive a written demand for performance from the Company
which describes the basis for the Company’s belief that the Executive has
willfully or deliberately violated his obligations to the Company;
               (B) engaging in willful misconduct which is injurious to the
Company or any Subsidiary;
               (C) committing a felony, an act of fraud against or the
misappropriation of property belonging to the Company or any Subsidiary;
               (D) breaching, in any material respect, terms of any
confidentiality or proprietary information agreement between the Executive and
the Company; or
               (E) committing a material violation of the Company’s Code of
Business Ethics or Employee Conduct and Standards Policy, as either or both are
in effect from time to time by the Company.
          (ii) For purposes of Involuntary Termination Associated With a Change
in Control, means a determination by the Board that Executive has committed any
of the following acts:
               (A) the Executive has been convicted of a criminal violation
involving fraud, embezzlement or theft in connection with his duties or in the
course of her employment with the Company or any Subsidiary; or
               (B) the Executive has committed intentional wrongful disclosure
of secret processes or confidential information of the Company or any
Subsidiary; and any such act has been demonstrably and materially harmful to the
Company. For purposes of this subparagraph (B), no act on the part of the
Executive will be deemed “intentional” if it was due primarily to an error in
judgment or negligence, but will be deemed “intentional” if done by the
Executive not in good faith and without reasonable belief that the Executive’s
action was in the best interest of the Company.
Notwithstanding the foregoing, the Executive will not be deemed to have been
terminated for “Cause” under this subsection (ii) unless and until there has
been delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters of the members of the Board
then in office at a meeting of the Board, finding that, in the good faith
opinion of the Board, the Executive has committed an act constituting “Cause,”
as herein defined, and specifying the particulars thereof in detail. Prior to
any such determination, Executive shall be provided with reasonable notice of
such pending determination and Executive, together with his counsel (if the
Executive chooses to have counsel present at such meeting), shall be provided
with the opportunity

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to be heard before the Board makes any such determination. Nothing herein will
limit the right of the Executive or his beneficiaries to contest the validity or
propriety of any such determination.
     (d) “Change in Control” means the occurrence of any of the following
events:
          (i) the acquisition by any individual, entity or group (within the
meaning of section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 25% or more of the combined voting power of the then
outstanding Voting Stock of the Company; provided, however, that for purposes of
this Section 1(d)(i), the following acquisitions will not constitute a Change in
Control: (A) any issuance of Voting Stock of the Company directly from the
Company that is approved by the Incumbent Board (as defined in Section 1(d)(ii),
below), (B) any acquisition by the Company of Voting Stock of the Company,
(C) any acquisition of Voting Stock of the Company by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any Subsidiary, or
(D) any acquisition of Voting Stock of the Company by any Person pursuant to a
Business Combination that complies with clauses (A), (B) and (C) of
Section 1(d)(iii), below; and provided, further, that a Change in Control will
not occur if any Person becomes the beneficial owner of 25% or more of the
combined voting power of the Voting Stock of the Company solely as a result of
an issuance of Voting Stock described in clause (A) of this Section 1(d)(i) or
an acquisition of Voting Stock described in clause (B) of this Section 1(d)(i)
unless and until such Person thereafter acquires beneficial ownership of Voting
Stock of the Company that causes the aggregate percent of the combined voting
power of the Voting Stock of the Company then owned beneficially by such Person
to exceed the percent of the combined voting power of Voting Stock of the
Company owned beneficially by such Person immediately after such issuance or
acquisition described in clause (A) or (B) of this Section 1(d)(i);
          (ii) individuals who, as of the date hereof, constitute the Board (the
“Incumbent Board,” as modified by this Section 1(d)(ii)), cease for any reason
to constitute at least a majority of the Board; provided, however, that any
individual becoming a Director subsequent to the date hereof whose election, or
nomination for election by the Company’s stockholders, was approved by a vote of
at least two-thirds of the Directors then comprising the Incumbent Board (either
by a specific vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection to such
nomination) will be deemed to have then been a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest (within
the meaning of Rule 14a-11 of the Exchange Act) 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;
          (iii) consummation of a reorganization, merger or consolidation, a
sale or other disposition of all or substantially all of the assets of the
Company, or other transaction (each, a “Business Combination”), unless, in each
case, immediately following such Business Combination, (A) all or substantially
all of the individuals and

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entities who were the beneficial owners of Voting Stock of the Company
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of the combined voting power of the then outstanding
shares of Voting Stock of the entity resulting from such Business Combination
(including, without limitation, an entity which as a result of such transaction
owns the Company or all or substantially all of the Company’s assets either
directly or through one or more subsidiaries), (B) no Person (other than the
Company; such entity resulting from such Business Combination; any employee
benefit plan (or related trust) sponsored or maintained by the Company, any
Subsidiary or such entity resulting from such Business Combination; or any
Person who immediately prior to such Business Combination beneficially owned
directly or indirectly 25% or more of the combined voting power of the voting
stock of the Company and whose ownership of such Voting Stock did not result in
a Change in Control under Section 1(d)(i)) beneficially owns, directly or
indirectly, 25% or more of the combined voting power of the then outstanding
shares of Voting Stock of the entity resulting from such Business Combination,
and (C) at least a majority of the members of the Board of Directors of the
entity resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement or of the action of
the Board providing for such Business Combination; or
          (iv) approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company, except pursuant to a Business
Combination that complies with clauses (A), (B) and (C) of Section 1(d)(iii).
     (e) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of
1986, as amended.
     (f) “Code” means the Internal Revenue Code of 1986, as amended.
     (g) “Constructive Termination Associated With a Change in Control” means
the termination of the Executive’s employment with the Company by Executive as a
result of the occurrence of one of the following events as a result of a Change
in Control:
          (i) without the Executive’s express written consent, the failure to
elect or reelect or otherwise to maintain the Executive in the office or the
position, or an equivalent office or position, of or with the Company and/or a
Subsidiary (or any successor thereto by operation of law of or otherwise), as
the case may be, which the Executive held immediately prior to a Change in
Control, or the removal of the Executive as a Director of the Company and/or a
Subsidiary (or any successor thereto) if the Executive has been a Director of
the Company and/or a Subsidiary immediately prior to the Change in Control;
          (ii) without the Executive’s express written consent, the failure of
the Company to remedy any of the following within ten (10) business days after
receipt by the Company of written notice thereof from the Executive: (A) an
adverse change in the nature or scope of the authorities, powers, functions,
responsibilities or duties attached to the position with the Company and any
Subsidiary which the Executive held immediately prior to the Change in Control,
(B) a reduction in the aggregate of the Executive’s Base

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Pay and Incentive Pay, or (C) the termination or denial of the Executive’s
rights to Employee Benefits or a reduction in the scope or value thereof;
          (iii) without the Executive’s express written consent, a determination
by the Executive (which determination will be conclusive and binding upon the
parties hereto provided it has been made in good faith and in all events will be
presumed to have been made in good faith unless otherwise shown by the Company
by clear and convincing evidence) that a change in circumstances has occurred
following a Change in Control, including, without limitation, a change in the
scope of the business or other activities for which the Executive was
responsible immediately prior to the Change in Control, which has rendered the
Executive unable to carry out, has hindered the Executive’s performance of, or
has caused the Executive to suffer a reduction in, any of the authorities,
powers, functions, responsibilities or duties attached to the position held by
the Executive immediately prior to the Change in Control, which situation is not
remedied within ten (10) business days after written notice to the Company from
the Executive of such determination;
          (iv) without the Executive’s express written consent, the liquidation,
dissolution, merger, consolidation or reorganization of the Company or transfer
of all or substantially all of its business and/or assets, unless the successor
or successors (by liquidation, merger, consolidation, reorganization, transfer
or otherwise) to which all or substantially all of its business and/or assets
have been transferred (by operation of law or otherwise) assumes all duties and
obligations of the Company under this Agreement pursuant to Section 15(a);
          (v) without the Executive’s express written consent, a requirement by
the Company that the Executive have his principal location of work changed to
any location that is in excess of thirty-five (35) miles from the location
thereof immediately prior to the Change in Control, or that the Executive travel
away from his office in the course of discharging his responsibilities or duties
hereunder at least 20% more (in terms of aggregate days in any calendar year or
in any calendar quarter when annualized for purposes of comparison to any prior
year) than was required of the Executive in any of the three (3) full years
immediately prior to the Change in Control; or
          (vi) without limiting the generality or effect of the foregoing,
without the Executive’s express written consent, any material breach of this
Agreement by the Company or any successor thereto which is not remedied by the
Company within ten (10) business days after receipt by the Company of written
notice from the Executive of such breach.
In no event shall the termination of Executive’s employment with the Company on
account of the Executive’s death or Disability or because the Executive engaged
in conduct constituting Cause be deemed to be a Constructive Termination
Associated With a Change in Control.

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     (h) “Constructive Termination Prior to a Change in Control” means the
termination of Executive’s employment with the Company by the Executive as a
result of:
          (i) without the Executive’s express written consent, a comprehensive
and substantial reduction in all or most of the Executive’s primary duties,
authority and responsibilities compared to the Executive’s duties, authority and
responsibilities immediately prior to such reduction;
          (ii) without the Executive’s express written consent, a significant
reduction in the Executive’s Base Pay compared to the Executive’s Base Pay in
effect immediately prior to such reduction; provided, however, that a reduction
in the Executive’s Base Pay of less than twenty percent (20%) or a reduction in
the Executive’s Base Pay that is part of an overall reduction in compensation
also applied to other senior executives of the Company as a result of decreased
business performance by the Company or one of its business units, shall not
constitute a Constructive Termination Prior to a Change in Control; or
          (iii) without the Executive’s express written consent, the failure of
the Company to obtain the assumption of this Agreement by any successors.
In no event shall the termination of Executive’s employment with the Company on
account of the Executive’s death or Disability or because the Executive engaged
in conduct constituting Cause be deemed to be a Constructive Termination Prior
to a Change in Control.
     (i) “Disability” means the Executive becomes permanently disabled within
the meaning of, and begins actually to receive disability benefits pursuant to,
the long-term disability plan in effect for, or applicable to, the Executive.
     (j) “Employee Benefits” means the perquisites, benefits and service credit
for benefits as provided under any and all employee retirement income and
welfare benefit policies, plans, programs or arrangements in which the Executive
is entitled to participate, including, without limitation, any stock option,
performance share, performance unit, stock purchase, stock appreciation,
savings, pension, supplemental executive retirement, or other retirement income
or welfare benefit, deferred compensation, incentive compensation, group or
other life, health, medical/hospital or other insurance (whether funded by
actual insurance or self-insured by the Company or a Subsidiary), disability,
salary continuation, expense reimbursement and other employee benefit policies,
plans, programs or arrangements that may now exist or any equivalent successor
policies, plans, programs or arrangements that may be adopted hereafter by the
Company or a Subsidiary, providing perquisites, benefits and service credit for
benefits at least as great in the aggregate as are payable thereunder.
     (k) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

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     (l) “Incentive Pay” means the greater of: (i) Executive’s maximum Target
Bonus for which Executive was eligible during the period that includes the
Termination Date, or (ii) the highest aggregate bonus or incentive payment paid
to Executive during any of the three (3) full calendar years prior to his
Termination Date. For purposes of this definition, “Target Bonus” means the
annual bonus, incentive, commission or other sales incentive compensation, or
comparable incentive payment opportunity which, in the sole discretion of the
Company, is deemed to constitute a Target Bonus, in addition to Base Pay, for
which Executive was eligible to receive, but did not receive prior to his
Termination Date, in regard to services rendered in the year covered by
Executive’s Termination Date and is to be made pursuant to any bonus, incentive,
profit-sharing, performance, discretionary pay or similar agreement, policy,
plan, program or arrangement (whether or not funded) of the Company or a
Subsidiary, or any successor thereto. For purposes of this definition,
“Incentive Pay” does not include any stock option, stock appreciation, stock
purchase, restricted stock or similar plan, program, arrangement or grant, one
time bonus or payment (including, but not limited to, any sign-on bonus), any
amounts contributed by the Company for the benefit of Executive to any qualified
or nonqualified deferred compensation plan, whether or not provided under an
arrangement described in the prior sentence, or any amounts designated by the
parties as amounts other than Incentive Pay.
     (m) “Involuntary Termination Associated With a Change in Control” means the
termination of Executive’s employment related to a Change in Control: (i) by the
Company for any reason other than Cause, the Executive’s death or the
Executive’s Disability, or (ii) on account of a Constructive Termination
Associated with a Change in Control.
     (n) “Involuntary Termination Prior to a Change in Control” means the
termination of Executive’s employment unrelated to a Change in Control: (i) by
the Company for any reason other than Cause, the Executive’s death or the
Executive’s Disability, or (ii) on account of a Constructive Termination Prior
to a Change in Control.
     (o) “Key Employee” shall mean any employee or former employee of the
Company who is considered a key employee under section 409A(2)(B)(i) of the
Code, having an identification date for purposes of section 409A of December 31,
or any other party deemed a key Employee under applicable regulations issued
pursuant to sections 409A.
     (p) “Restricted Business” means,
          (i) if the Executive is entitled to severance benefits under this
Agreement on account of an Involuntary Termination Prior to a Change in Control,
(A) the design, development, manufacture, marketing or support of local or wide
area network products, computer operating systems, applications products,
software products or services that enable organizations to more effectively
conduct business using the Web, or any other software products of the type
designed, developed, manufactured, sold or supported by the Company or as
proposed to be designed, developed, manufactured, sold or supported by the
Company pursuant to a development project that is actually being

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pursued during the term of this Agreement; (B) any business that performs
technology and consulting services that help businesses develop and accelerate
their transition to Internet-based e-business solutions and processes, or
management services that assist businesses in improving their operating
processes; or (C) any business that competes directly or indirectly with the
hardware, software or consulting businesses of the Company.
          (ii) if the Executive is entitled to severance benefits under this
Agreement on account of an Involuntary Termination Associated With a Change in
Control, any business function with a direct competitor of the Company that is
substantially similar to the business function performed by the Executive with
the Company immediately prior to his Termination Date.
     (q) “Restricted Territory” means the counties, towns, cities or states of
any country in which the Company operates or does business.
     (r) “Severance Period” means the twelve (12) month period after the
Executive’s Termination Date.
     (s) “Subsidiary” means any Company controlled affiliate.
     (t) “Termination Date” means the last day of Executive’s employment with
the Company.
     (u) “Termination of Employment” means, except as provided in the following
sentence, the termination of Executive’s active employment relationship with the
Company on account of an Involuntary Termination Prior to a Change in Control or
an Involuntary Termination Associated With a Change in Control. For purposes of
the non-solicitation provision of Section 11 of the Agreement, the term
“Termination of Employment” shall mean the termination of Executive’s employment
relationship with the Company for any reason, including, but not limited to, the
Executive’s Involuntary Termination Prior to a Change in Control, Involuntary
Termination Associated With a Change in Control, voluntary termination,
termination on account of Disability, or termination by the Company for Cause.
     (v) “Voting Stock” means securities entitled to vote generally in the
election of directors.
2. Termination Prior to a Change in Control.
     (a) Involuntary Termination Prior to a Change in Control. In the event
Executive’s employment is terminated on account of an Involuntary Termination
Prior to a Change in Control, Executive shall be entitled to the benefits
provided in subsection (b) of this Section 2.
     (b) Compensation and Benefits Upon Involuntary Termination Prior to a
Change in Control. Subject to the provisions of Section 5 hereof, in the event a

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termination described in subsection (a) of this Section 2 occurs, the Company
shall pay and provide to the Executive after his Termination Date:
          (i) 150% of his Base Pay, payable in equal installments over the
Severance Period, consistent with the Company’s past payroll practices,
commencing with the first payroll period that occurs after the period during
which Executive’s right to revoke his acceptance to the terms of the Release has
expired. Notwithstanding the foregoing, the Company may determine, in its sole
discretion and at any time, to provide that the amounts payable under this
subsection (i) shall be paid to Executive in a lump sum, as opposed to
installments over the Severance Period; provided, however, that such discretion
shall not be exercised in a manner which will cause adverse income tax results
to Executive.
          (ii) Executive shall receive his pro rated Incentive Pay for the year
in which his Termination of Employment occurs. The pro rated Incentive Pay shall
be based on the Executive’s Incentive Pay for the year in which Executive’s
Termination Date occurs, multiplied by a fraction, the numerator of which is the
number of days during which Executive was employed by the Company in the year of
his termination and the denominator of which is 365. Such pro rated Incentive
Pay shall be paid to Executive in equal installments over the Severance Period,
consistent with the Company’s past payroll practices, commencing with the first
payroll period that occurs after the period during which Executive’s right to
revoke his acceptance to the terms of the Release has expired. Notwithstanding
the foregoing, the Company may determine, in its sole discretion and at any
time, to provide that the amounts payable under this subsection (ii) shall be
paid to Executive in a lump sum, as opposed to installments over the Severance
Period.
          (iii) For the Severance Period commencing the month immediately
following the month in which his Termination Date occurs, Executive shall
continue to receive the medical and dental coverage in effect on his Termination
Date (or generally comparable coverage) for himself and, where applicable, his
spouse and dependents, as the same may be changed from time to time for
employees generally, as if Executive had continued in employment during such
period; provided, however, that in the event that such continuation coverage
violates applicable law or results in a material adverse tax effect to the
Company or the Executive, the Company shall pay Executive cash in lieu of such
coverage in an amount equal to Executive’s after-tax cost of continuing
comparable coverage, where such coverage may not be continued by the Company (or
where such continuation would adversely affect the tax status of the plan
pursuant to which the coverage is provided). If the Executive does not receive
the cash payment described in the preceding sentence, the Company shall take all
commercially reasonable efforts to provide that the COBRA health care
continuation coverage period under section 4980B of the Code, shall commence
immediately after the foregoing twelve (12) month benefit period, with such
continuation coverage continuing until the earlier of (i) the end of the
applicable COBRA health care continuation coverage period or (ii) the date on
which Executive is covered by the medical and dental coverage of his successor
employer, if any.

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          (iv) With respect to any Company stock options held by the Executive
as of the date of such Involuntary Termination Prior to a Change in Control, the
Company shall accelerate the vesting of that portion of the Executive’s stock
options, if any, which would have vested and become exercisable within the one
(1) year period after the Executive’s Termination Date, such options, plus any
other options that previously became exercisable and have not expired or been
exercised, to remain exercisable, notwithstanding anything in any other
agreement governing such options, for the longer of (A) a period of six
(6) months after the Executive’s Termination Date, or (B) the period set forth
in the award agreement covering the option (the “Option Expiration Date”);
provided, however, that in no event will the option be exercisable beyond its
original term or, if not addressed in the grant agreement, then not later than
the latest date that will avoid adverse tax consequences to the Executive (if
such date is earlier than the Option Expiration Date).
          (v) With respect to any shares of Company common stock held by the
Executive that are, at the time of such Involuntary Termination Prior to a
Change in Control, subject to the Company’s repurchase right upon termination of
the Executive’s employment (“Restricted Stock”), the Company shall waive such
repurchase right as to the number of shares of Restricted Stock that would have
vested within the one (1) year period after the Executive’s Termination Date.
          (vi) To cover the cost of outplacement assistance services for
Executive that are actually provided by an outplacement agency selected by
Executive, for which the Company provides prior approval, with such approval not
to be unreasonably withheld, in an amount not to exceed twenty percent (20%) of
the Executive’s Base Pay.
          (vii) Executive shall receive any amounts earned, accrued or owing but
not yet paid to Executive as of his Termination Date, payable in a lump sum, and
any benefits accrued or earned in accordance with the terms of any applicable
benefit plans and programs of the Company.
3. Termination Associated With a Change in Control.
     (a) Involuntary Termination Associated With a Change in Control. In the
event Executive’s employment is terminated after, or in connection with, a
Change in Control, on account of (i) an Involuntary Termination Associated With
a Change in Control within the two year period after the Change in Control, or
(ii) an Involuntary Termination Associated With a Change in Control that occurs
(A) not more than six (6) months prior to the date on which a Change in Control
occurs or (B) following the commencement of any discussion with a third person
that ultimately results in a Change in Control, Executive shall be entitled to
the benefits provided in subsection (b) of this Section 3. If Executive is
entitled to benefits described in this Section 3 by reason of clause (a)(ii)
above, Executive shall receive the compensation and benefits described in
Section 2(b) above after his Termination of Employment, in accordance with the
provisions of Section 2(b), regardless of whether the Change in Control actually
occurs, and Executive shall receive the additional compensation and benefits
described in Section

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3(b) below only if the Change in Control is consummated and shall receive such
additional amounts after the consummation of the Change in Control, in
accordance with the provisions of Section 3(b) below. For purposes of subsection
3(a)(ii)(B) above, to be eligible to receive amounts described in Section 3(b)
below, the Change in Control must be consummated within the twelve (12) month
period following Executive’s Termination Date, except in circumstances pursuant
to which the consummation of the Change in Control is delayed, through no
failure of the Company or the third person, by a governmental or regulatory
authority or agency with jurisdiction over the matter, or as a result of other
similar circumstances. In such a circumstance, the remaining of the twelve
(12) month period shall be tolled and shall recommence upon termination of the
delaying event.
     (b) Compensation and Benefits Upon Involuntary Termination Associated With
a Change in Control. Subject to the provisions of Section 5 hereof, in the event
a termination described in subsection (a) of this Section 3 occurs, the Company
shall pay and provide to the Executive after his Termination Date:
          (i) Lump sum payment equal to (A) 2 times Base Pay, plus (B) 2 times
Incentive Pay. Payment shall be made in accordance with the Company’s normal
payroll practices but not later than the thirtieth day after Executive’s
Termination Date (or the end of the revocation period for the Release, if
later); provided, however, that if Executive is deemed by the Company to be a
Key Employee as of the Termination Date, such payment shall occur on the earlier
of the following: (x) six months following Executive’s Termination Date; or
(y) the date on which the Company determines payment may be made without causing
adverse tax consequences to Executive.
          (ii) Executive shall receive his pro rated Incentive Pay for the year
in which his Termination of Employment occurs. The pro rated Incentive Pay shall
be based on the Executive’s Incentive Pay for the year in which Executive’s
Termination Date occurs, multiplied by a fraction, the numerator of which is the
number of days during which Executive was employed by the Company in the year of
his termination and the denominator of which is 365. Such pro rated Incentive
Pay shall be paid to Executive in a lump sum in accordance with the Company’s
normal payroll practices but not later than the thirtieth day after Executive’s
Termination Date (or the end of the revocation period for the Release, if
later).
          (iii) For the Severance Period commencing the month immediately
following the month in which his Termination Date occurs, Executive shall
continue to receive the medical and dental coverage in effect on his Termination
Date (or generally comparable coverage) for himself and, where applicable, his
spouse and dependents, as the same may be changed from time to time for
employees generally, as if Executive had continued in employment during such
period; provided, however, that in the event that such continuation coverage
violates applicable law or results in a material adverse tax effect to the
Company or the Executive, the Company shall pay Executive cash in lieu of such
coverage in an amount equal to Executive’s after-tax cost of continuing
comparable coverage, where such coverage may not be continued by the Company (or
where such continuation would adversely affect the tax status of the plan
pursuant to which the

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coverage is provided). If the Executive does not receive the cash payment
described in the preceding sentence, the Company shall take all commercially
reasonable efforts to provide that the COBRA health care continuation coverage
period under section 4980B of the Code, shall commence immediately after the
foregoing twenty-four (24) month benefit period, with such continuation coverage
continuing until the earlier of (i) the end of the applicable COBRA health care
continuation coverage period or (ii) the date on which Executive is covered by
the medical and dental coverage of his successor employer, if any.
          (iv) Lump sum payment equal to the total amount that Executive would
have received under the Company’s 401(k) plan as a Company match if Executive
was eligible to participate in the Company’s 401(k) plan for the twenty-four
(24) month period after his Termination Date and he contributed the maximum
amount to the plan for the match. Payment shall be made in accordance with the
Company’s normal payroll practices but not later than the thirtieth day after
Executive’s Termination Date (or the end of the revocation period for the
Release, if later).
          (v) Lump sum payment equal to the total premiums that the Company
would have paid under Executive’s split-dollar life insurance policy, if any,
that is in effect immediately prior to his Termination Date, if Executive was
employed by the Company for the twenty-four (24) month period following
Executive’s Termination Date; provided, however, that if the remaining length of
the term of the split-dollar arrangement pursuant to which the Company must make
premium payments is less than the foregoing twenty-four (24) month period,
Executive shall only receive a lump sum payment equal to the remaining Company
premiums for the term of the arrangement. Payment shall be made in accordance
with the Company’s normal payroll practices but not later than the thirtieth day
after Executive’s Termination Date (or the end of the revocation period for the
Release, if later). Notwithstanding the foregoing, no payment shall be made to
Executive pursuant to this subsection (v) if on the Executive’s Termination
Date, either Executive does not have a split-dollar life insurance policy with
the Company or the Company has no obligations to make premium contributions to
Executive’s split-dollar life insurance policy.
          (vi) Lump sum payment equal to twenty percent (20%) of the Executive’s
Base Pay in order to cover the cost of outplacement assistance services for
Executive. Payment shall be made in accordance with the Company’s normal payroll
practices but not later than the thirtieth day after Executive’s Termination
Date (or the end of the revocation period for the Release, if later).
          (vii) Executive shall receive any amounts earned, accrued or owing but
not yet paid to Executive as of his Termination Date, payable in a lump sum, and
any benefits accrued or earned in accordance with the terms of any applicable
benefit plans and programs of the Company.
     (c) Notwithstanding any provision to the contrary in any applicable plan,
program or agreement, upon the occurrence of a Change in Control, all stock
options, Restricted Stock and other equity rights held by the Executive will
become fully vested

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and/or exercisable, as the case may be, on the date on which the Change in
Control occurs, and all stock options held by the Executive shall remain
exercisable, notwithstanding anything in any other agreement governing such
options, for the longer of (i) a period of twenty-four (24) months after the
Executive’s Termination Date, or (ii) the period set forth in the award
agreement covering the option (the “Option Expiration Date”); provided, however,
that in no event will the option be exercisable beyond its original term or, if
not addressed in the grant agreement, then not later than the latest date that
will avoid adverse tax consequences to the Executive (if such date is earlier
than the Option Expiration Date).
4. Termination of Employment on Account of Disability, Cause or Death.
Notwithstanding anything in this Agreement to the contrary, if Executive’s
employment terminates on account of Disability, Executive shall be entitled to
receive disability benefits under any disability program maintained by the
Company that covers Executive, and Executive shall not be considered to have
terminated employment under this Agreement and shall not receive benefits
pursuant to Sections 2 and 3 hereof. If Executive’s employment terminates on
account of Cause or because of his death, Executive shall not be considered to
have terminated employment under this Agreement and shall not receive benefits
pursuant to Sections 2 and 3 hereof.
5. Release. Notwithstanding the foregoing, no such payments shall be made or
benefits provided unless Executive executes, and does not revoke, the Company’s
standard written release, substantially in the form as attached hereto as Annex
A, (the “Release”), of any and all claims against the Company and all related
parties with respect to all matters arising out of Executive’s employment by the
Company (other than entitlements under the terms of this Agreement or under any
other plans or programs of the Company in which Executive participated and under
which Executive has accrued or become entitled to a benefit) or a termination
thereof.
6. Enforcement. Without limiting the rights of the Executive at law or in
equity, if the Company fails to make any payment or provide any benefit required
to be made or provided hereunder on a timely basis, the Company will pay
interest on the amount or value thereof at an annualized rate of interest equal
to the so-called composite “prime rate” as quoted from time to time during the
relevant period in the Eastern Edition of The Wall Street Journal. Such interest
will be payable as it accrues on demand. Any change in such prime rate will be
effective on and as of the date of such change.
7. Certain Additional Payments by the Company.
     (a) The provisions of this Section 7 shall apply notwithstanding anything
in this Agreement to the contrary. Subject to subsection (b) below, in the event
that it shall be determined that any payment, benefit provided or distribution
by the Company to or for the benefit of Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise (a “Payment”), would constitute an “excess parachute payment” within
the meaning of section 280G of the Code, the Company shall pay Executive an
additional amount (the “Gross-Up Payment”) such that the net amount retained by
Executive after deduction of any excise tax imposed under

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section 4999 of the Code, and any federal, state and local income tax,
employment tax, excise tax and other tax imposed upon the Gross-Up Payment,
shall be equal to the Payment. The right to each payment of such amount shall
vest as of the day on which the payment determination is made, and each such
payment shall be made on the thirtieth day following the vesting date.
     (b) Notwithstanding subsection (a), and notwithstanding any other
provisions of this Agreement to the contrary, if the net after-tax benefit to
Executive of receiving the Gross-Up Payment does not exceed the Safe Harbor
Amount (as defined below) by more than 10% (as compared to the net-after tax
benefit to Executive resulting from elimination of the Gross-Up Payment and
reduction of the Payments to the Safe Harbor Amount), then (i) the Company shall
not pay Executive the Gross-Up Payment and (ii) the provisions of subsection
(c) below shall apply. The term “Safe Harbor Amount” means the maximum dollar
amount of parachute payments that may be paid under section 280G of the Code
without imposition of an excise tax under section 4999 of the Code.
     (c) The provisions of this subsection (c) shall apply only if the Company
is not required to pay Executive a Gross-Up Payment as a result of subsection
(b) above. If the Company is not required to pay Executive a Gross-Up Payment as
a result of the provisions of subsection (b), the Company will apply a
limitation on the Payment amount as set forth in subsection (i) below (a
“Parachute Cap”) if the application of the Parachute Cap is beneficial to
Executive, according to the following provisions:
          (i) If subsection (ii) does not apply, the aggregate present value of
the Payments under Section 3 of this Agreement (“Agreement Payments”) shall be
reduced (but not below zero) to the Reduced Amount. The “Reduced Amount” shall
be an amount expressed in present value which maximizes the aggregate present
value of Agreement Payments without causing any Payment to be subject to the
limitation of deduction under section 280G of the Code. For purposes of this
Section 7, “present value” shall be determined in accordance with section
280G(d)(4) of the Code.
          (ii) It is the intention of the parties that the Parachute Cap apply
only if application of the Parachute Cap is beneficial to Executive. Therefore,
if the net amount that would be retained by Executive under this Agreement
without the Parachute Cap, after payment of any excise tax under section 4999 of
the Code, exceeds the net amount that would be retained by Executive with the
Parachute Cap, then the Company shall not apply the Parachute Cap to Executive’s
payments. In that event, neither the Parachute Cap nor the Gross-Up Payment will
apply to Executive.
     (d) All determinations to be made under this Section 7 shall be made by the
nationally recognized independent public accounting firm used by the Company
immediately prior to the Change in Control (“Accounting Firm”), which Accounting
Firm shall provide its determinations and any supporting calculations to the
Company and Executive within ten days of Executive’s termination date. If any
Gross-Up Payment is required to be made, the Company shall make the Gross-Up
Payment within ten days after receiving the Accounting Firm’s calculations. Any
such determination by the Accounting Firm shall be binding upon the Company and
Executive.

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     (e) All of the fees and expenses of the Accounting Firm in performing the
determinations referred to in this Section 7 shall be borne solely by the
Company.
8. No Mitigation Obligation. The Company hereby acknowledges that it will be
difficult and may be impossible for the Executive to find reasonably comparable
employment following the Termination Date. Accordingly, the payment of the
severance compensation by the Company to the Executive in accordance with the
terms of this Agreement is hereby acknowledged by the Company to be reasonable,
and the Executive will not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise, nor
will any profits, income, earnings or other benefits from any source whatsoever
create any mitigation, offset, reduction or any other obligation on the part of
the Executive hereunder or otherwise.
9. Legal Fees and Expenses. In the event of a Change in Control, it is the
intent of the Company that the Executive not be required to incur legal fees and
the related expenses associated with the interpretation, enforcement or defense
of the Executive’s rights under this Agreement by litigation or otherwise
because the cost and expense thereof would detract from the benefits intended to
be extended to the Executive hereunder. Accordingly, if a Change in Control
occurs and it should appear to the Executive that the Company has failed to
comply with any of its obligations under this Agreement or in the event that the
Company or any other person takes or threatens to take any action to declare
this Agreement void or unenforceable, or institutes any litigation or other
action or proceeding designed to deny, or to recover from, the Executive the
benefits provided or intended to be provided to the Executive under Section 3(b)
of the Agreement, the Company irrevocably authorizes the Executive from time to
time to retain counsel of the Executive’s choice, at the expense of the Company
as hereafter provided, to advise and represent the Executive in connection with
any such interpretation, enforcement or defense, including without limitation
the initiation or defense of any litigation or other legal action, whether by or
against the Company or any Director, officer, stockholder or other person
affiliated with the Company, in any jurisdiction. Notwithstanding any existing
or prior attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Executive’s entering into an attorney-client
relationship with such counsel, and in that connection the Company and the
Executive agree that a confidential relationship will exist between the
Executive and such counsel. Without respect to whether the Executive prevails,
in whole or in part, in connection with any of the foregoing, the Company will
pay and be solely financially responsible for any and all attorneys’ and related
fees and expenses incurred by the Executive in connection with any of the
foregoing; provided that, in regard to such matters, the Executive has not acted
frivolously, in bad faith or with no colorable claim of success. Such expenses
will be paid by the Company on the thirtieth day following its receipt of
adequate substantiation to support payment of the expense amount.
10. Confidentiality. The Executive hereby covenants and agrees that he will not
disclose to any person not employed by the Company, or use in connection with
engaging in competition with the Company, any confidential or proprietary
information (as defined below) of the Company. For purposes of this Agreement,
the term “confidential or proprietary information” will include all information
of any nature and in any form that is

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owned by the Company and that is not publicly available (other than by the
Executive’s breach of this Section 10) or generally known to persons engaged in
businesses similar or related to those of the Company. Confidential or
proprietary information will include, without limitation, the Company’s
financial matters, customers, employees, industry contracts, strategic business
plans, product development (or other proprietary product data), marketing plans,
consulting solutions and processes, and all other secrets and all other
information of a confidential or proprietary nature which is protected by the
Uniform Trade Secrets Act. For purposes of the preceding two sentences, the term
“Company” will also include any Subsidiary (collectively, the “Restricted
Group”). The foregoing obligations imposed by this Section 10 will not apply
(i) in the course of the business of and for the benefit of the Company, (ii) if
such confidential or proprietary information has become, through no fault of the
Executive, generally known to the public, or (iii) if the Executive is required
by law to make disclosure (after giving the Company notice and an opportunity to
contest such requirement).
11. Covenants Not to Compete and Not to Solicit. In the event of Executive’s
Termination of Employment, the Company’s obligations to provide severance pay as
provided in Sections 2 and 3 shall be expressly conditioned upon the Executive’s
covenants not to compete and not to solicit as provided herein. In the event the
Executive breaches his obligations to the Company as provided herein, the
Company’s obligations to make severance payments to Executive pursuant to
Sections 2 and 3 shall cease, without prejudice to any other remedies that may
be available to the Company.
     (a) Covenant Not to Compete.
          (i) If Executive is receiving compensation and benefits under Section
2(b) above, then for a period of nine (9) months following Executive’s
Termination Date, the Executive shall not directly or indirectly, engage in
(whether as employee, consultant, proprietor, partner, director or otherwise),
or have any ownership interest in, or participate in a financing, operation,
management or control of, any person, firm, corporation or business that is a
Restricted Business in a Restricted Territory without the prior written consent
of the Board. For this purpose, ownership of no more than 5% of the outstanding
Voting Stock of a publicly traded corporation shall not constitute a violation
of this provision.
          (ii) If Executive is receiving compensation and benefits under Section
3(b) above (or subsequently becomes entitled to severance under Section 3(b)
above because of a termination described in Section 3(a)(ii)), then for a period
of one (1) year following Executive’s Termination Date, the Executive shall not
directly or indirectly, engage in (whether as employee, consultant, proprietor,
partner, director or otherwise), or have any ownership interest in, or
participate in a financing, operation, management or control of, any person,
firm, corporation or business that is a Restricted Business in a Restricted
Territory without the prior written consent of the Board. For this purpose,
ownership of no more than 5% of the outstanding Voting Stock of a publicly
traded corporation shall not constitute a violation of this provision.

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     (b) Covenant Not to Solicit. The Executive shall not, for a period of two
(2) years after the Executive’s Termination Date for any reason: (i) solicit,
encourage or take any other action which is intended to induce any other
employee of the Company to terminate his employment with the Company; or
(ii) interfere in any manner with the contractual or employment relationship
between the Company and any such employee of the Company. The foregoing shall
not prohibit Executive or any entity with which Executive may be affiliated from
hiring a former employee of the Company, provided that such hiring results
exclusively from such former employee’s affirmative response to a general
recruitment effort.
     (c) Interpretation. The covenants contained herein are intended to be
construed as a series of separate covenants, one for each county, town, city and
state or other political subdivision of a Restricted Territory. Except for
geographic coverage, each such separate covenant shall be deemed identical in
terms to the covenant contained in the preceding subsections. If, in any
judicial proceeding, the court shall refuse to enforce any of the separate
covenants (or any part thereof) deemed included in such subsections, then such
unenforceable covenant (or such part) shall be deemed to be eliminated from this
Agreement for the purpose of those proceedings to the extent necessary to permit
the remaining separate covenants (or portions thereof) to be enforced.
     (d) Reasonableness. In the event that the provisions of this Section 11
shall ever be deemed to exceed the time, scope or geographic limitations
permitted by applicable laws, then such provisions shall be reformed to the
maximum time, scope or geographic limitations, as the case may be, permitted by
applicable laws.
12. Employment Rights. Nothing expressed or implied in this Agreement will
create any right or duty on the part of the Company or the Executive to have the
Executive remain in the employment of the Company or any Subsidiary prior to or
following any Change in Control.
13. Certain Tax Matters.
     (a) Withholding. The Company may withhold from any amounts payable under
this Agreement all federal, state, city or other taxes as the Company is
required to withhold pursuant to any applicable law, regulation or ruling.
     (b) Effect of Section 409A of the Code. The parties intend that the
provisions of this Agreement will operate in a manner that will avoid adverse
federal income tax consequences under Section 409A of the Code. Executive hereby
acknowledges and agrees that the Company may take any actions deemed necessary
in its sole discretion to avoid adverse federal income tax consequences under
section 409A of the Code and that such action may be taken without the consent
of Executive.
     (c) Time of Payment. If a payment is not made by the designated payment
date under this Agreement, the payment will be made in any event by the later of
(i) the end of the calendar year in which the designated payment date occurs or
(ii) the 15th day

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of the third calendar month following the designated payment date, or such other
date as may be permitted by section 409A of the Code and the regulations
thereunder.
14. Term of Agreement. This Agreement shall continue in full force and effect
for the duration of Executive’s employment with the Company; provided, however,
that after the termination of Executive’s employment during the term of this
Agreement, this Agreement shall remain in effect until all of the obligations of
the parties hereunder are satisfied or have expired.
15. Successors and Binding Agreement.
     (a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form
and substance reasonably satisfactory to the Executive, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent the
Company would be required to perform if no such succession had taken place. This
Agreement will be binding upon and inure to the benefit of the Company and any
successor to the Company, including without limitation any persons acquiring
directly or indirectly all or substantially all of the business or assets of the
Company whether by purchase, merger, consolidation, reorganization or otherwise
(and such successor will thereafter be deemed the “Company” for the purposes of
this Agreement), but will not otherwise be assignable, transferable or delegable
by the Company.
     (b) This Agreement will inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees. This Agreement will supersede the
provisions of any employment or other agreement between the Executive and the
Company that relate to any matter that is also the subject of this Agreement,
and such provisions in such other agreements will be null and void.
     (c) This Agreement is personal in nature and neither of the parties hereto
will, without the consent of the other, assign, transfer or delegate this
Agreement or any rights or obligations hereunder except as expressly provided in
Sections 15(a) and 15(b). Without limiting the generality or effect of the
foregoing, the Executive’s right to receive payments hereunder will not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest, or otherwise, other than by a transfer by the Executive’s will or by
the laws of descent and distribution and, in the event of any attempted
assignment or transfer contrary to this Section 15(c), the Company will have no
liability to pay any amount so attempted to be assigned, transferred or
delegated.
16. Notices. For all purposes of this Agreement, all communications, including
without limitation notices, consents, requests or approvals, required or
permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed by the recipient), or five
(5) business days after having been mailed by United States registered or
certified mail, return receipt requested, postage prepaid, or

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three (3) business days after having been sent by a nationally recognized
courier service for overnight/next-day delivery, such as FedEx, UPS, or the
United States Postal Service, addressed to the Company (to the attention of the
Secretary of the Company) at its principal executive office and to the Executive
at his principal residence, or to such other address as any party may have
furnished to the other in writing and in accordance herewith, except that
notices of changes of address will be effective only upon receipt.
17. Governing Law. The validity, interpretation, construction and performance of
this Agreement will be governed by and construed in accordance with the
substantive laws of the Commonwealth of Massachusetts, without giving effect to
the principles of conflict of laws of such Commonwealth.
18. Validity. If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid, unenforceable
or otherwise illegal, the remainder of this Agreement and the application of
such provision to any other person or circumstances will not be affected, and
the provision so held to be invalid, unenforceable or otherwise illegal will be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid or legal.
19. Miscellaneous.
     (a) Except as provided in subparagraph (b) below, no provision of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing signed by the Executive and the Company. No
waiver by either party hereto at any time of any breach by the other party
hereto or compliance with any condition or provision of this Agreement to be
performed by such other party will be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, expressed or implied with
respect to the subject matter hereof have been made by either party that are not
set forth expressly in this Agreement. References to Sections are to references
to Sections of this Agreement. Any reference in this Agreement to a provision of
a statute, rule or regulation will also include any successor provision thereto.
Whenever used herein, the masculine includes the feminine.
     (b) Notwithstanding any contrary provision of this Agreement, the Company
may modify benefits otherwise payable or to be provided under this Agreement
without obtaining the Executive’s consent to such modification to the extent
that the Company determines in its sole discretion that such modification is
necessary or appropriate in order to effect compliance with applicable law or
regulatory requirements. In particular, the Executive acknowledges and agrees
that the provisions of Section 409A of the Code may require delay in payment or
provision of benefits otherwise due under the terms of this Agreement until a
date that is at least six (6) months following the date of the Executive’s
separation from service with the Company, and may limit the permissible forms or
timing of severance benefits that may be provided under this Agreement.
20. Survival. Notwithstanding any provision of this Agreement to the contrary,
the parties’ respective rights and obligations under Sections 2, 3, 7, 9, 10,
and 11 will survive

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any termination or expiration of this Agreement or the termination of the
Executive’s employment for any reason whatsoever.
21. Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original but all of which together will
constitute one and the same agreement.
[SIGNATURE PAGE FOLLOWS]

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     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.

         
NOVELL, INC.
       
 
       
By:
       
/s/ Jack L. Messman
       
 
Name: Jack L. Messman
       
Title: Chairman and Chief Executive Officer
       
 
       
EXECUTIVE
       
/s/ Jeffrey M. Jaffe
       
 
       

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Annex A
SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE
     THIS SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE (the
“Agreement”) is made as of this                      day of
                    ,                     , by and between Novell, Inc. (the
“Company”) and                      (“Executive”).
     WHEREAS, Executive formerly was employed by the Company as
                    ;
     WHEREAS, Executive and Company entered into the Severance Agreement, dated
                                         , 200_, (the “Severance Agreement”)
which provides for certain benefits in the event that Executive’s employment is
terminated on account of a reason set forth in the Severance Agreement;
     WHEREAS, Executive and the Company mutually desire to terminate Executive’s
employment on an amicable basis, such termination to be effective
                                         ,                      (“Date of
Resignation”); and
     WHEREAS, in connection with the termination of Executive’s employment, the
parties have agreed to a separation package and the resolution of any and all
disputes between them.
     NOW, THEREFORE, IT IS HEREBY AGREED by and between Executive and the
Company as follows:
     1. (a) Executive, for and in consideration of the commitments of the
Company as set forth in paragraph 6 of this Agreement, and intending to be
legally bound, does hereby REMISE, RELEASE AND FOREVER DISCHARGE the Company,
its affiliates, subsidiaries and parents, and its officers, directors,
employees, and agents, and its and their respective successors and assigns,
heirs, executors, and administrators (collectively, “Releasees”) from all causes
of action, suits, debts, claims and demands whatsoever in law or in equity,
which Executive ever had, now has, or hereafter may have, whether known or
unknown, or which Executive’s heirs, executors, or administrators may have, by
reason of any matter, cause or thing whatsoever, from the beginning of
Executive’s employment to the date of this Agreement, and particularly, but
without limitation of the foregoing general terms, any claims arising from or
relating in any way to Executive’s employment relationship with the Company, the
terms and conditions of that employment relationship, and the termination of
that employment relationship, including, but not limited to, any claims arising
under the Age Discrimination in Employment Act, the Older Workers Benefit
Protection Act, Title VII of The Civil Rights Act of 1964, the Americans with
Disabilities Act, the Family and Medical Leave Act of 1993, the Employee
Retirement Income Security Act of 1974, [State Fair Employment Practice Law],
and any other claims under any federal, state or local common law, statutory, or
regulatory provision, now or hereafter recognized, and

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any claims for attorneys’ fees and costs. This Agreement is effective without
regard to the legal nature of the claims raised and without regard to whether
any such claims are based upon tort, equity, implied or express contract or
discrimination of any sort.
          (b) To the fullest extent permitted by law, and subject to the
provisions of paragraph 11 below, Executive represents and affirms that (i)
[other than                     ,] Executive has not filed or caused to be filed
on Executive’s behalf any claim for relief against the Company or any Releasee
and, to the best of Executive’s knowledge and belief, no outstanding claims for
relief have been filed or asserted against the Company or any Releasee on
Executive’s behalf; (ii) [other than                     ,] Executive has not
reported any improper, unethical or illegal conduct or activities to any
supervisor, manager, department head, human resources representative, agent or
other representative of the Company, to any member of the Company’s legal or
compliance departments, or to the ethics hotline, and has no knowledge of any
such improper, unethical or illegal conduct or activities; and (iii) Executive
will not file, commence, prosecute or participate in any judicial or arbitral
action or proceeding against the Company or any Releasee based upon or arising
out of any act, omission, transaction, occurrence, contract, claim or event
existing or occurring on or before the date of this Agreement.
     2. [The Company, for and in consideration of the commitments of the
Executive as set forth in this Agreement, and intending to be legally bound,
does hereby REMISE, RELEASE AND FOREVER DISCHARGE the Executive from all claims,
demands or causes of action arising out of facts or occurrences prior to the
date of this Agreement, but only to the extent the Company knows or reasonably
should know of such facts or occurrence and only to the extent such claim,
demand or cause of action relates to a violation of applicable law or the
performance of Executive’s duties with the Company; provided, however, that this
release of claims shall not in any case be effective with respect to any claim
by the Company alleging a breach of the Executive’s obligations under this
Agreement.]
[Note: Paragraph 2 only applies if Executive is receiving severance benefits on
account of an Involuntary Termination Associated With a Change in Control.]
     3. In consideration of the Company’s agreements as set forth in paragraph 6
herein, Executive agrees to be comply with the limitations described in
Sections 10 and 11 of the Severance Agreement.
     4. Executive further agrees and recognizes that Executive has permanently
and irrevocably severed Executive’s employment relationship with the Company,
that Executive shall not seek employment with the Company or any affiliated
entity at any time in the future, and that the Company has no obligation to
employ him in the future.
     5. Executive further agrees that Executive will not disparage or subvert
the Company, or make any statement reflecting negatively on the Company, its
affiliated corporations or entities, or any of their officers, directors,
employees, agents or representatives, including, but not limited to, any matters
relating to the operation or

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management of the Company, Executive’s employment and the termination of
Executive’s employment, irrespective of the truthfulness or falsity of such
statement.
     6. In consideration for Executive’s agreement as set forth herein, the
Company agrees:
[Note: The following severance benefits would apply if the Executive has an
Involuntary Termination Prior to a Change in Control.]
          (i) [to pay Executive 150% of Executive’s Base Pay (as defined in the
Severance Agreement) [for the Severance Period (as defined in the Severance
Agreement), payable in equal installments, consistent with the Company’s past
payroll practices, commencing with the first payroll period that occurs after
the period during which Executive’s right to revoke Executive’s acceptance to
the terms of this Agreement have expired.] or [, payable in a lump sum, within
thirty (30) days after Executive’s Date of Resignation (or the end of the
revocation period set forth in this Agreement, if later).]
          (ii) to pay Executive Executive’s pro rated Incentive Pay (as defined
in the Severance Agreement) for the year in which Executive’s Date of
Resignation occurs. Such pro rated Incentive Pay shall be paid to Executive [for
the Severance Period payable in equal installments, consistent with the
Company’s past payroll practices, commencing with the first payroll period that
occurs after the period during which Executive’s right to revoke Executive’s
acceptance to the terms of the Release has expired.] or [paid in a lump sum,
within thirty (30) days after Executive’s Date of Resignation (or the end of the
revocation period set forth in this Agreement, if later).]
          (iii) [for a period of twelve (12) months following Executive’s Date
of Resignation, Executive shall continue to receive the medical and dental
coverage in effect on Executive’s Date of Resignation (or generally comparable
coverage) for Executive and, where applicable, Executive’s spouse and
dependents, as the same may be changed from time to time for employees
generally, as if Executive had continued in employment during such period.] or
[pay Executive cash in a lump sum payment equal to Executive’s after-tax cost of
continuing comparable medical and dental coverage for the twelve (12) month
period following Executive’s Date of Resignation]. [The Company shall take all
commercially reasonable efforts to provide that the COBRA health care
continuation coverage period under section 4980B of the Code, shall commence
immediately after the foregoing twelve (12) month benefit period, with such
continuation coverage continuing until the earlier of (i) the end of the
applicable COBRA health care continuation coverage period or (ii) the date on
which Executive is covered by the medical and dental coverage of Executive’s
successor employer, if any.]
          (iv) with respect to any Company stock options held by the Executive
as of Executive’s Date of Resignation, the portion of Executive’s stock options,
if any, which would have vested and become exercisable within the one (1) year
period after the Executive’s Date of Resignation shall become vested and

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exercisable as of Executive’s Date of Resignation, such options, plus any other
options that previously became exercisable and have not expired or been
exercised, to remain exercisable, notwithstanding anything in any other
agreement governing such options, for the longer of (A) a period of six
(6) months after the Executive’s Date of Resignation, or (B) the period set
forth in the award agreement covering the option, subject in either case only to
the original term of the option. Any stock options held by Executive that are
not exercisable as of the Executive’s Date of Resignation shall terminate as of
the Executive’s Date of Resignation.
          (v) with respect to any shares of Company common stock that are held
by the Executive that are, at the time of Executive’s Date of Resignation,
subject to the Company’s repurchase right upon termination of the Executive’s
employment (“Restricted Stock”), to waive such repurchase right as to the number
of shares of Restricted Stock that would have become no longer subject to the
Company’s repurchase right within the one (1) year period after the Executive’s
Date of Resignation.
          (vi) pay the cost of outplacement assistance services for Executive
that are actually provided by an outplacement agency selected by Executive,
which the Company provides prior approval, with such approval not to be
unreasonably withheld, in an amount not to exceed twenty percent (20%) of the
Executive’s Base Pay.
          (vii) Executive shall receive any amounts earned, accrued or owing but
not yet paid to Executive as of Executive’s Date of Resignation, payable in a
lump sum, and any benefits accrued or earned in accordance with the terms of any
applicable benefit plans and programs of the Company.
Except as set forth in this Agreement, it is expressly agreed and understood
that Releasees do not have, and will not have, any obligations to provide
Executive at any time in the future with any payments, benefits or
considerations other than those recited in this paragraph, or those required by
law, other than under the terms of any benefit plans which provide benefits or
payments to former employees according to their terms.]
[Note: The following severance benefits would apply if the Executive has an
Involuntary Termination Associated With a Change in Control.]
          (i) [to pay to Executive a lump sum payment equal to (A) 2 times Base
Pay (as defined in the Severance Agreement), plus (B) 2 times Incentive Pay (as
defined in the Severance Agreement). Payment shall be made within thirty
(30) days after the effective date of Executive’s Date of Resignation (or the
end of the revocation period set forth in this Agreement, if later).
          (ii) to pay Executive Executive’s pro rated Incentive Pay (as defined
in the Severance Agreement) for the year in which Executive’s Date of

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Resignation occurs. Such pro rated Incentive Pay shall be paid to Executive in a
lump sum within thirty (30) days after the effective date of the termination (or
the end of the revocation period set forth in this Agreement, if later).
          (iii) [for a period of twenty-four (24) months following Executive’s
Date of Resignation, Executive shall continue to receive the medical and dental
coverage in effect on Executive’s Date of Resignation (or generally comparable
coverage) for Executive and, where applicable, Executive’s spouse and
dependents, as the same may be changed from time to time for employees
generally, as if Executive had continued in employment during such period] or
[pay Executive cash in a lump sum payment equal to Executive’s after-tax cost of
continuing comparable medical and dental coverage for the twenty-four (24) month
period following Executive’s Date of Resignation.] [The Company shall take all
commercially reasonable efforts to provide that the COBRA health care
continuation coverage period under section 4980B of the Code, shall commence
immediately after the foregoing twenty-four (24) month benefit period, with such
continuation coverage continuing until the earlier of (i) the end of the
applicable COBRA health care continuation coverage period or (ii) the date on
which Executive is covered by the medical and dental coverage of Executive’s
successor employer, if any.]
          (iv) to pay to Executive a lump sum payment equal to the total amount
that Executive would have received under the Company’s 401(k) plan as a Company
match if Executive was eligible to participate in the Company’s 401(k) plan for
the twenty-four (24) month period after Executive’s Date of Resignation and
Executive contributed the maximum amount to the plan for the match. Payment
shall be made within thirty (30) days after the Executive’s Date of Resignation
(or the end of the revocation period set forth in this Agreement, if later).
          (v) [to pay to Executive a lump sum payment equal to the total
premiums that the Company would have paid under Executive’s split-dollar life
insurance policy, if any, that is in effect immediately prior to Executive’s
Date of Resignation, if Executive was employed by the Company for the
twenty-four (24) month period following Executive’s Date of Resignation. Payment
shall be made within thirty (30) days after the effective date of Executive’s
Date of Resignation (or the end of the revocation period set forth in this
Agreement, if later)]. [Note: The foregoing only applies if Executive has a
split-dollar arrangement with the Company and the Company is required to make
premium contributions on Executive’s Date of Resignation. The total months
covered by the premiums will be reduced if the term of the policy is shorter
than that provided for Executive.]
          (vi) to pay to Executive a lump sum payment equal to twenty percent
(20%) of the Executive’s Base Pay in order to cover the cost of outplacement
assistance services for Executive. Payment shall be made within thirty (30) days
after the effective date of Executive’s Date of Resignation (or the end of the
revocation period set forth in this Agreement, if later).

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          (vii) Executive shall receive any amounts earned, accrued or owing but
not yet paid to Executive as of Executive’s Date of Resignation, payable in a
lump sum, and any benefits accrued or earned in accordance with the terms of any
applicable benefit plans and programs of the Company.
Except as set forth in this Agreement, it is expressly agreed and understood
that Releasees do not have, and will not have, any obligations to provide
Executive at any time in the future with any payments, benefits or
considerations other than those recited in this paragraph, or those required by
law, other than under the terms of any benefit plans which provide benefits or
payments to former employees according to their terms.]
     7. Executive understands and agrees that the payments, benefits and
agreements provided in this Agreement are being provided to him in consideration
for Executive’s acceptance and execution of, and in reliance upon Executive’s
representations in, this Agreement. Executive acknowledges that if Executive had
not executed this Agreement containing a release of all claims against the
Company, Executive would only have been entitled to the payments provided in the
Company’s standard severance pay plan for employees.
     8. Executive acknowledges and agrees that the Company previously has
satisfied any and all obligations owed to him under any employment agreement or
offer letter Executive has with the Company and, further, that this Agreement
supersedes any employment agreement or offer letter Executive has with the
Company, and any and all prior agreements or understandings, whether written or
oral, between the parties shall remain in full force and effect to the extent
not inconsistent with this Agreement, and further, that, except as set forth
expressly herein, no promises or representations have been made to him in
connection with the termination of Executive’s employment agreement, if any, or
offer letter, if any, with the Company, or the terms of this Agreement.
     9. Executive agrees not to disclose the terms of this Agreement to anyone,
except Executive’s spouse, attorney and, as necessary, tax/financial advisor.
Likewise, the Company agrees that the terms of this Agreement will not be
disclosed except as may be necessary to obtain approval or authorization to
fulfill its obligations hereunder or as required by law. It is expressly
understood that any violation of the confidentiality obligation imposed
hereunder constitutes a material breach of this Agreement.
     10. Executive represents that Executive does not presently have in
Executive’s possession any records and business documents, whether on computer
or hard copy, and other materials (including but not limited to computer disks
and tapes, computer programs and software, office keys, correspondence, files,
customer lists, technical information, customer information, pricing
information, business strategies and plans, sales records and all copies
thereof) (collectively, the “Corporate Records”) provided by the Company and/or
its predecessors, subsidiaries or affiliates or obtained as a result of
Executive’s prior employment with the Company and/or its predecessors,
subsidiaries or affiliates, or created by Executive while employed by or
rendering services to the

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Company and/or its predecessors, subsidiaries or affiliates. Executive
acknowledges that all such Corporate Records are the property of the Company. In
addition, Executive shall promptly return in good condition any and all Company
owned equipment or property, including, but not limited to, automobiles,
personal data assistants, facsimile machines, copy machines, pagers, credit
cards, cellular telephone equipment, business cards, laptops and computers. As
of the Date of Resignation, the Company will make arrangements to remove,
terminate or transfer any and all business communication lines including network
access, cellular phone, fax line and other business numbers.
     11. Nothing in this Agreement shall prohibit or restrict Executive from:
(i) making any disclosure of information required by law; (ii) providing
information to, or testifying or otherwise assisting in any investigation or
proceeding brought by, any federal regulatory or law enforcement agency or
legislative body, any self-regulatory organization, or the Company’s [designated
legal, compliance or human resources officers]; or (iii) filing, testifying,
participating in or otherwise assisting in a proceeding relating to an alleged
violation of any federal, state or municipal law relating to fraud, or any rule
or regulation of the Securities and Exchange Commission or any self-regulatory
organization.
     12. The parties agree and acknowledge that the agreement by the Company
described herein, and the settlement and termination of any asserted or
unasserted claims against the Releasees, are not and shall not be construed to
be an admission of any violation of any federal, state or local statute or
regulation, or of any duty owed by any of the Releasees to Executive.
     13. Executive agrees and recognizes that should Executive breach any of the
obligations or covenants set forth in this Agreement, the Company will have no
further obligation to provide Executive with the consideration set forth herein,
and will have the right to seek repayment of all consideration paid up to the
time of any such breach. Further, Executive acknowledges in the event of a
breach of this Agreement, Releasees may seek any and all appropriate relief for
any such breach, including equitable relief and/or money damages, attorney’s
fees and costs.
     14. Executive further agrees that the Company shall be entitled to
preliminary and permanent injunctive relief, without the necessity of proving
actual damages, as well as to an equitable accounting of all earnings, profits
and other benefits arising from any violations of this Agreement, which rights
shall be cumulative and in addition to any other rights or remedies to which the
Company may be entitled.
     15. This Agreement and the obligations of the parties hereunder shall be
construed, interpreted and enforced in accordance with the laws of the
Commonwealth of Massachusetts.
     16. Executive certifies and acknowledges as follows:

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          (a) That Executive has read the terms of this Agreement, and that
Executive understands its terms and effects, including the fact that Executive
has agreed to RELEASE AND FOREVER DISCHARGE the Company and each and everyone of
its affiliated entities from any legal action arising out of Executive’s
employment relationship with the Company and the termination of that employment
relationship;
          (b) That Executive has signed this Agreement voluntarily and knowingly
in exchange for the consideration described herein, which Executive acknowledges
is adequate and satisfactory to him and which Executive acknowledges is in
addition to any other benefits to which Executive is otherwise entitled;
          (c) That Executive has been and is hereby advised in writing to
consult with an attorney prior to signing this Agreement;
          (d) That Executive does not waive rights or claims that may arise
after the date this Agreement is executed;
          (e) That the Company has provided him with a period of [twenty-one
(21)] or [forty-five (45)] days within which to consider this Agreement, and
that Executive has signed on the date indicated below after concluding that this
Separation of Employment Agreement and General Release is satisfactory to him;
and
          (f) Executive acknowledges that this Agreement may be revoked by him
within seven (7) days after execution, and it shall not become effective until
the expiration of such seven (7) day revocation period. In the event of a timely
revocation by Executive, this Agreement will be deemed null and void and the
Company will have no obligations hereunder.
[SIGNATURE PAGE FOLLOWS]

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     Intending to be legally bound hereby, Executive and the Company executed
the foregoing Separation of Employment Agreement and General Release this
                     day of                     ,                     .

                     
 
          Witness:                           [Executive]                
 
                    NOVELL, INC.                
 
                   
By:
          Witness:        
 
                    Name:                 Title:                

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