EXHIBIT 10.25
Executive Change of Control Agreement – Full Double-Trigger
[Date]
[Name]
[Title]
Callidus Software Inc.
Dear                    :
This letter modifies any Stock Option Agreement or Restricted Stock Unit
Agreement or other agreement documenting any equity award (as applicable, any
“Equity Award Agreement”) or Employment Agreement you may now or hereafter have
with respect to the common stock of Callidus Software Inc. (the “Company”) and
any prior agreement between you and the Company regarding the Equity Award
Agreements including, without limitation, any prior change of control
agreement(s). This letter provides for accelerated vesting of your Callidus
stock options, restricted stock awards, restricted stock units and other
equity-based awards, as applicable (collectively, the “Equity Awards”) under the
conditions described below.
If, within 18 months after a “Change in Control,” your employment is terminated
by the Company without “Cause” or by you for “Good Reason,” you shall receive
100% vesting of your Equity Awards.
Section 409A. Notwithstanding anything to the contrary in this Agreement, if you
are determined to be a “specified employee” within the meaning of Section 409A
of the Internal Revenue Code, as amended (“Section 409A”) and the regulations
thereunder, as of the date of your “separation from service” as defined in
Treasury Regulation Section 1.409A-1(h) (or any successor regulation), and if
any payments or entitlements provided for in this Agreement constitute a
“deferral of compensation” within the meaning of Section 409A and therefore
cannot be paid or provided in the manner provided herein without subjecting you
to additional tax, interest or penalties under Section 409A, then any such
payment and/or entitlement which would have been payable during the first six
months following your “separation from service” shall instead be paid or
provided to you in a lump sum payment on the first business day immediately
following the six-month anniversary of your “separation from service”. If this
payment has had to be deferred in this way for six months after your separation
from service, then the lump sum payment will also include interest on the
deferred payment or payments at a per annum rate equal to the highest rate of
interest not exceeding 4% applicable to six-month money market accounts on the
date of such “separation from service” offered by the following institutions:
Citibank N.A., Wells Fargo Bank, N.A. or Bank of America. Except for the
foregoing interest payment, nothing in this Section shall increase the amount
due under this Agreement or otherwise from the Company to you. In addition, any
payments or benefits due hereunder upon a termination of your employment which
are a “deferral of compensation” within the meaning of Section 409A shall only
be payable or provided to you (or your estate) upon (or, to the extent provided
for in this paragraph, following the six-month anniversary of) your “separation
from service” as defined in Section 409A.
     For purposes of the above:
     (a) “Cause” means the occurrence of any one or more of the following:
     (i) any material act of misconduct or dishonesty by you in the performance
of your duties;
     (ii) any willful and material failure by you to perform your duties;
     (iii) any material breach of any employment agreement, confidentiality
agreement or proprietary information agreement;
     (iv) your conviction of (or pleading guilty or nolo contendere to) a
misdemeanor involving theft, embezzlement, dishonesty or moral turpitude or a
felony; provided that in the case of clauses (i) through (iii), you shall have a
period of 30 days from written notice by the Company to cure such action or
omission unless not reasonably susceptible of cure.

 

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     (b) “Good Reason” means:
     (i) any reduction in your base salary or annual target bonus;
     (ii) any material reduction in your other benefits;
     (iii) any material reduction in your duties, responsibilities, or
authority; or
     (iv) a requirement that you relocate to a location more than 35 miles from
your then current office location.
     (c) “Change in Control” means:
     (i) The acquisition by any “person” (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act) of “beneficial ownership” (as defined in
Rule 13d-3 under said Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented
by the Company’s then outstanding voting securities (it being understood that
securities owned by any person on the date hereof shall not be counted against
such limit with respect to such person); or
     (ii) A change in the composition of the Board of Directors of the Company
(the “Board”) occurring within a rolling 2 year period, as a result of which
fewer than a majority of the directors are Incumbent Directors. “Incumbent
Directors” shall mean directors who either (A) are members of the Board as of
the date hereof, or (B) are elected, or nominated for election, to the Board
with the affirmative votes of at least a majority of the Incumbent Directors at
the time of such election or nomination (but shall not include an individual not
otherwise an Incumbent Director whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election of directors
to the Board); or
     (iii) A merger or consolidation involving the Company other than a merger
or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
Surviving Entity (including the parent corporation of such Surviving Entity)) at
least fifty percent (50%) of the total voting power represented by the voting
securities of the Company or such Surviving Entity outstanding immediately after
such merger or consolidation, or a sale or disposition by the Company of all or
substantially all the Company’s assets.
The term “Surviving Entity” shall refer to the entity surviving the merger,
consolidation or sale of substantially all of the assets and continuing with the
assets or business of the Company in the case of a Change of Control event
described in clause (iii) above.
The modification to the terms of the vesting schedule of your Equity Awards as
described in this letter has been approved by the Board and is effective
immediately.
Sincerely,
[Insert Officer Name]
[Insert Officer Title]
AGREED AND ACCEPTED this ____ day of                     20__.

     
 
   
 
[Name]