Exhibit 10.78

 

Addendum To Employment Offer Letter

For Severance Benefits

 

The provisions of this Employment Offer Letter Addendum for Severance Benefits
(the “Addendum”) are incorporated into, and are made a part of, that employment
offer letter (the “Offer Letter”) by and between you,
                             and the Borland Software Corporation (“Borland”)
and these provisions are effective immediately. Capitalized terms used in this
Addendum are either defined herein or in Appendix A.

 

1.     Severance Benefits.

 

(a)     Termination of Employment Outside of the Change in Control Period. If
your employment is terminated as a result of an Involuntary Termination other
than during the Change in Control Period and you sign a release of claims (in a
form satisfactory to Borland, an example of which is attached hereto as Appendix
B), then you shall be entitled to payment of fifty percent (50%) of your annual
Base Salary, less applicable withholding. Such amount shall be payable in a lump
sum no later than five (5) days following expiration of any revocation period
required in connection with the release of claims; provided, however, if this
payment is subject to Section 409A and you are a “specified employee” (as
defined in Section 409A), this payment shall be made within five (5) days after
the six (6) month anniversary of the Termination Date (or such sooner date that
is permitted under Section 409A).

 

(b)     Termination of Employment During the Change in Control Period. If your
employment is terminated as a result of an Involuntary Termination during the
Change in Control Period and you sign a release of claims (substantially in the
form attached hereto as Appendix B), then you shall be entitled to the following
severance benefits:

 

(i)    Payment of one hundred percent (100%) of your annual Base Salary, less
applicable withholding. Such amount shall be payable in a lump sum no later than
five (5) days following expiration of any revocation period required in
connection with the release of claims; provided, however, if this payment is
subject to Section 409A and you are a “specified employee” (as defined in
Section 409A), this payment shall be made within five (5) days after the six
(6) month anniversary of the Termination Date (or such sooner date that is
permitted under Section 409A);

 

(ii)    All stock options and stock appreciation rights granted to you after
October 27, 2005 shall become fully vested and exercisable as of the Termination
Date to the extent such stock options and stock appreciation rights are
outstanding and unexercisable at the time of such termination; all stock subject
to a right of repurchase or forfeiture by Borland (or its successor) granted to
you after October 27, 2005 shall have such right of repurchase or forfeiture
lapse with respect to all of the shares; and any restricted stock unit awards or
other phantom stock awards shall become fully vested and the shares subject to
such awards shall be issued no later than five (5) days following expiration of
any revocation period required in connection with the release of claims (or
within five (5) days of any later date required to comply with Section 409A).

 

(c)     Continuing Medical Coverage. If your employment is terminated as a
result of an Involuntary Termination, whether or not a Change in Control Period,
and you sign a release of claims (in a form satisfactory to Borland, an example
of which is attached hereto as Appendix B), then you shall be entitled to
payment for your premiums for health (i.e., medical, vision and dental)
continuation coverage under COBRA; provided, however, that (i) you are eligible
for COBRA on the Termination Date and (ii) you elect continuation coverage
pursuant to COBRA, within the required time period. Borland shall continue to
provide you with health coverage pursuant to this paragraph until the earliest
of (i) the date you are no longer eligible to receive continuation coverage
pursuant to COBRA, (ii) twelve (12) months from the Termination Date or
(iii) the date on which you obtain comparable health coverage. You agree to
notify Borland promptly after you obtain alternative health coverage.

 

2.     Additional Terms. This Addendum is an amendment of your Offer Letter,
which amends and replaces the severance provisions of the Offer Letter. To the
extent other terms of your employment are not specifically addressed in this
Addendum, the terms of your Offer Letter shall continue to govern. For example,
the terms of your at-will employment and your obligation to arbitrate any
disputes shall continue and shall apply to this Addendum.

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3.     Mitigation. Except as otherwise specifically provided herein, you shall
not be required to mitigate damages or the amount of any payment provided under
this Addendum by seeking other employment or otherwise, nor shall the amount of
any payment provided for under this Addendum be reduced by any compensation you
earn as a result of your employment by another employer or by any retirement
benefits you receive after the Termination Date.

 

4.     Successors.

 

(a)     Borland’s Successors. Any successor to Borland (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of Borland’s business and/or assets shall
assume Borland’s obligations under this Addendum and agree expressly to perform
Borland’s obligations under this Addendum in the same manner and to the same
extent as Borland would be required to perform such obligations in the absence
of a succession. For all purposes under this Addendum, the term “Borland” shall
include any successor to Borland’s business and/or assets which acknowledges it
will be bound by the terms of this Addendum or which becomes bound by the terms
of this Addendum by operation of law.

 

(b)     Your Successors. Without the written consent of Borland, you shall not
assign or transfer this Addendum or any right or obligation under this Addendum
to any other person or entity. Notwithstanding the foregoing, the terms of this
Addendum and all you rights hereunder shall inure to the benefit of, and be
enforceable by, your personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.

 

5.     Notices. Notices and all other communications contemplated by this
Addendum shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. In your case, mailed notices shall be
addressed to you at the home address which you most recently communicated to
Borland in writing. In the case of Borland, mailed notices shall be addressed to
its corporate headquarters, and all notices shall be directed to the attention
of its General Counsel.

 

6.     Code Section 409A. The parties agree to amend this Addendum to the extent
necessary to avoid imposition of any additional tax or income recognition prior
to actual payment to you under Code Section 409A and any temporary or final
Treasury Regulations and Internal Revenue Service guidance thereunder.

 

7.     Miscellaneous Provisions.

 

(a)     Integration. This Addendum represents the entire agreement and
understanding between the parties as to the subject matter herein and supersede
all prior or contemporaneous agreements and provisions in other agreements
related to severance benefits, whether written or oral. With respect to any
conflict between this Addendum and any stock option agreement, stock issuance
agreement or other stock award agreement, this Addendum shall prevail. With
respect to any conflict between this Addendum and the Offer Letter or any other
employment related agreement, this Addendum shall prevail. For the avoidance of
doubt, with respect to any severance benefits provided for under your Offer
Letter, this Addendum shall supersede the provisions of your Offer Letter with
respect to severance benefits provided thereunder.

 

(b)     Choice of Law. The validity, interpretation, construction and
performance of this Addendum shall be governed by the internal substantive laws,
but not the conflicts of law rules, of the State of California.

 

(c)     Employment Taxes. All payments made pursuant to this Addendum shall be
subject to withholding of applicable income and employment taxes.

 

(d)     Non-Publication. The parties mutually agree not to disclose the terms of
this Addendum except to the extent that disclosure is mandated by applicable
law, standard or required corporate reporting, or disclosure is made to the
parties’ respective advisors and agents (e.g., attorneys, accountants) or
immediate family members.

 

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IN WITNESS WHEREOF, each of the parties has executed this Addendum, in the case
of Borland by its duly authorized officer, as of the day and year first above
written.

 

BORLAND SOFTWARE CORPORATION:        EXECUTIVE:                (Signature)     
  (Signature)

By:

          

By:

   

Title:

          

Title:

   

 

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APPENDIX A

 

The following definitions shall be in effect under the severance benefits
letter:

 

(a)     Base Salary. “Base Salary” means your annual base salary as in effect
during the last regularly scheduled payroll period immediately preceding the
effective date of your termination due to an Involuntary Termination.

 

(b)     Board. “Board” means the Board of Directors of Borland.

 

(c)     Change in Control. “Change in Control” means a change in ownership or
control of the Company effected through any of the following transactions:

 

(i)    there is consummated a merger, consolidation or other reorganization,
unless securities representing more than fifty percent (50%) of the total
combined voting power of the voting securities of the successor corporation are
immediately thereafter beneficially owned, directly or indirectly and in
substantially the same proportion, by the persons who beneficially owned the
Corporation’s outstanding voting securities immediately prior to such
transaction, or

 

(ii)    the sale, transfer or other disposition of all or substantially all of
the Corporation’s assets in complete liquidation or dissolution of the
Corporation other than a sale or disposition by the Corporation of all or
substantially all of the Corporation’s assets to an entity, at least fifty
percent (50%) of the combined voting power of the voting securities of which are
owned by stockholders of the Corporation in substantially the same proportions
as their ownership of the Corporation immediately prior to such sale, or

 

(iii)    the acquisition, directly or indirectly, by any person or related group
of persons (other than the Corporation or a person that directly or indirectly
controls, is controlled by, or is under common control with, the Corporation) of
beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of
securities possessing more than thirty percent (30%) of the total combined
voting power of the Corporation’s outstanding securities pursuant to a tender or
exchange offer made directly to the Corporation’s stockholders.

 

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred by virtue of the consummation of any transaction or series of
integrated transactions immediately following which the record holders of the
Common Stock immediately prior to such transaction or series of transactions
continue to have substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of the Corporation immediately
following such transaction or series of transactions.

 

(d)     Change in Control Period. “Change in Control Period” means the period
beginning either (i) two (2) months prior to the effective date of a Change in
Control and ending twelve (12) months after the effective date of a Change in
Control or (ii) two (2) months prior to the effective date of a Hostile Takeover
and ending twelve (12) months after the effective date of a Hostile Takeover.

 

(e)     COBRA. “COBRA” means the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended.

 

(f)     Code. “Code” means the Internal Revenue Code of 1986, as amended.

 

(g)     Constructively Terminated. “Constructively Terminated” means your
voluntary resignation following (A) a change in your position with the Company
(or any Parent or Subsidiary employing you) which materially reduces your duties
and responsibilities, (B) a reduction in your level of compensation (including
base salary, fringe benefits and target bonus under any corporate performance
based bonus or incentive programs) or (C) a relocation of your place of
employment by more than fifty (50) miles, provided and only if such change,
reduction or relocation is effected by the Corporation without your consent.

 

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(h)     Hostile Take-Over. “Hostile Take-Over” shall be deemed to occur in the
event of a change in ownership or control of the Company effected through either
of the following transactions:

 

(i)    a change in the composition of the Board such that the following
individuals cease for any reason to constitute a majority of the Board then
serving: individuals who, on the date hereof, constitute the members of the
Board and any new Board member (other than a Board member whose initial
assumption of office is in connection with an actual or threatened election
contest, including (but not limited to) a consent solicitation, relating to the
election of Board members) whose appointment or election by the Board or
nomination for election by the Corporation’s stockholders was approved or
recommended by a vote of at least two-thirds (2/3) of the Board members then
still in office who either were Board members on the date hereof or whose
appointment, election or nomination for election was previously so approved or
recommended, or

 

(ii)    the acquisition, directly or indirectly, by any person or related group
of persons (other than Borland or a person that directly or indirectly controls,
is controlled by, or is under common control with, Borland) of beneficial
ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
possessing more than thirty percent (30%) of the total combined voting power of
the Borland’s outstanding securities pursuant to a tender or exchange offer made
directly to the Borland’s stockholders which the Board does not recommend such
stockholders to accept.

 

(i)    Involuntary Termination. “Involuntary Termination” means any termination
of you by Borland which is not effected for Misconduct; (ii) any purported
termination of you by Borland which is effected for Misconduct but for which the
grounds relied upon are not valid; (iii) any voluntary termination by you as a
result of your being Constructively Terminated; or (iv) the failure of Borland
to obtain the assumption of this Addendum by any successors contemplated in
Section 4 of the Addendum.

 

(j)     Misconduct. “Misconduct” means (i) your willful and continued failure to
perform the duties and responsibilities of your position that is not corrected
within a thirty (30) day correction period that begins upon delivery to you of a
written demand for performance from Borland that describes the basis for
Borland’s belief that you have not substantially performed your duties; (ii) any
act of personal dishonesty taken by you in connection with your responsibilities
as an employee of Borland with the intention that such may result in substantial
personal enrichment for you; (iii) your conviction of, or plea of nolo contendre
to, a felony that Borland reasonably believes has had or will have a material
detrimental effect on Borland’s reputation or business, or (iv) your materially
breaching your Employee Confidentiality and Assignment of Inventions Agreement,
which breach is (if capable of cure) not cured within thirty (30) days after
Borland delivers written notice to you of the breach

 

(k)     Section 409A. “Section 409A” shall mean Section 409A of the Code.

 

(l)     Termination Date. “Termination Date” shall mean the effective date of
any notice of termination delivered by one party to the other hereunder.

 

 

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APPENDIX B

 

RELEASE OF CLAIMS

 

I understand that my employment with Borland Software Corporation (“Borland”)
terminated effective             ,             (the “Separation Date”). Borland
has agreed that if I choose to sign this Release of Claims (“Release”), Borland
will pay me certain severance benefits (minus standard withholdings and
deductions) pursuant to the terms of the Employment Offer Letter Addendum for
Severance Benefits letter between myself and Borland, dated             (the
“Agreement”). I understand that I am not entitled to such benefits unless I sign
this Release and it becomes fully effective. I understand that, regardless of
whether I sign this Release, Borland will pay me all of my accrued salary and
vacation through the Separation Date, to which I am entitled by law.

 

In consideration for the severance benefits I am receiving under the Agreement,
as described therein, I hereby generally and completely release Borland, its
directors, officers, employees, stockholders, partners, agents, attorneys,
predecessors, successors, parent and subsidiary entities, insurers, affiliates,
and assigns from any and all claims, liabilities and obligations, both known and
unknown, that arise out of or are in any way related to events, acts, conduct,
or omissions occurring prior to my signing this Agreement. This general release
includes, but is not limited to: (1) all claims arising out of or in any way
related to my employment with Borland or the termination of that employment or
the services I provided to Borland; (2) all claims related to my compensation or
benefits from Borland, including salary, bonuses, commissions, vacation pay,
expense reimbursements, severance pay, fringe benefits, stock options,
restricted stock awards, other equity compensation or any other ownership
interests in Borland; (3) all claims for breach of contract, wrongful
termination, and breach of the implied covenant of good faith and fair dealing;
(4) all tort claims, including claims for fraud, defamation, emotional distress,
and discharge in violation of public policy; and (5) all federal, state, and
local statutory claims, including claims for discrimination, harassment,
retaliation, attorneys’ fees, or other claims arising under the federal Civil
Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of
1990, the federal Age Discrimination in Employment Act of 1967 (as amended)
(“ADEA”), and the California Fair Employment and Housing Act (as amended).
Notwithstanding anything contained in this Release, nothing herein shall release
the parties’ rights under this Release and my right (if any) to indemnification
granted by any act or agreement of Borland, state or federal law or policy of
insurance or any claims for severance benefits under the Agreement.

 

In releasing claims unknown to me at present, I am waiving all rights and
benefits under Section 1542 of the California Civil Code, and any law or legal
principle of similar effect in any jurisdiction: “A general release does not
extend to claims which the creditor does not know or suspect to exist in his or
her favor at the time of executing the release, which if known by him or her
must have materially affected his or her settlement with the debtor.”

 

I understand this Release will not be effective until the ADEA Effective Date,
defined below. I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under the ADEA. I also acknowledge that the
consideration given for the waiver in the above paragraph is in addition to
anything of value to which I was already entitled. I have been advised by this
writing, as required by the ADEA that: (a) my waiver and release does not apply
to any claims that may arise after my signing of this Release; (b) I should
consult with an attorney prior to signing this Release; (c) I have twenty-one
(21) days within which to consider this Release (although I may choose to
voluntarily sign this Release earlier); (d) I have seven (7) days after I sign
this Release to revoke it; and (e) this Release will not be effective until the
eighth day after this Release has been signed by me (the “ADEA Effective Date”).

 

I accept and agree to the terms and conditions stated above:

 

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Date

    [Name]

 

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