Exhibit
10.1


 


CONFIDENTIAL


 


ASPEN
TECHNOLOGY, INC.


 


Executive
Retention Agreement


 


Aspen Technology, Inc., a Delaware corporation (the “Company”),
and  [Name of executive] (the “Executive”)
enter into this Executive Retention Agreement (the “Agreement”) dated July 31,
2009 (the “Effective Date”).


 


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


 


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


 


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


 


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


 


1.     Key
Definitions.


 


As used herein, the following terms shall have the following respective
meanings:


 


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


 


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


 





















 


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


 


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


 


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


 


2





















 


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


 


(d)           the
liquidation or dissolution of the Company.


 


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


 


1.3           “Cause”
means:


 


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


 


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


 


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


 


1.4           “Good
Reason” means the occurrence, without the Executive’s prior written
consent, of any of the events or circumstances set forth in clauses (a) through
(g) below.  Notwithstanding the
occurrence of any such event or circumstance, such occurrence shall not be
deemed to constitute Good Reason if, prior to the Date of Termination specified
in the Notice of Termination (each as defined in Section 3) given by the
Executive in respect thereof, such event or circumstance has been fully
corrected and the Executive has been reasonably compensated for any losses or
damages resulting therefrom (provided that such right of correction by the
Company shall apply only with respect to the first Notice of Termination for
Good Reason given by the Executive).


 


(a)           the
assignment to the Executive of duties inconsistent in any material respect with
the Executive’s position (including status, offices, titles and reporting


 


3





















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


For
purposes of this Agreement, any claim of “Good Reason” made by the Executive
shall be presumed to be correct unless the Company establishes by clear and
convincing


 


4





















 


evidence that Good
Reason does not exist. The Executive’s right to terminate the Executive’s
employment for Good Reason shall not be affected by the Executive’s incapacity
due to physical or mental illness.


 


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


 


2.     Term
of Agreement.  This Agreement shall take effect upon the
Effective Date and shall expire upon the first to occur of (a) the
expiration of the Term (as defined below) if a Change in Control has not
occurred during the Term, (b) the date 12 months after the Change in
Control Date, if the Executive is still employed by the Company as of such
later date, or (c) the fulfillment by the Company of all of its
obligations under Sections 4 and 5.2 and 5.3  if
the Executive’s employment with the Company terminates during the Term or
within 12 months following the Change in Control Date.  “Term” shall mean the period commencing as of
the Effective Date and continuing in effect through July 31, 2010; provided,
however, that commencing on August 1, 2010 and each
August 1 thereafter, the Term shall be automatically extended for one
additional year unless, not later than seven days prior to the scheduled
expiration of the Term (or any extension thereof), the Company shall have given
the Executive written notice that the Term will not be extended.


 


3.     Notice
of Termination.


 


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


 


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


 


5





















 


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


 


4.     Termination;
Benefits to Executive.


 


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


 


(a)           For
the 12 months following the Date of Termination (the “Severance Period”), the
Company shall pay to the Executive an amount equal to Executive’s then current
base salary, to be paid on the Company’s normal payroll cycle during the
Severance Period; provided that if any payments would otherwise be due on or
after March 15 of the calendar year next succeeding the year in which
termination occurs, then all payments that would otherwise be due after March 15
shall be paid to the Executive in a lump sum in the payroll period on or immediately
prior to March 15 of such next succeeding year.


 


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


 


6





















 


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


 


(i)            a
pro rata portion of the Executive’s target bonus for the then-current fiscal
year, and


 


(ii)           in
lieu of any further life, disability, and accident insurance benefits (not
including medical, dental or vision insurance) (the “Other Plans”), an amount
equal to the cost to the Executive of providing such benefits, to the extent
that the Executive is eligible to receive such benefits immediately prior to
the Notice of Termination, for the Severance Period.


 


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


 


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


 


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


 


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


 


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


 


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


 


(A)          the
sum of (1) the Executive’s base salary through the Date of Termination,
and (2) the amount of any compensation previously deferred by the


 


7





















 


Executive
(together with any accrued interest or earnings thereon) and any accrued
vacation pay, in each case to the extent not previously paid;


 


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


 


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


 


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


 


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


 


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


 


(v)           With
respect to the Executive’s equity-based awards, (1) all of the
then-unvested options to purchase shares of stock of the Company held by the
Executive shall become fully vested and immediately exercisable in full, and
shares of the Company received upon exercise of any options will no longer be
subject to a right of repurchase by the Company, (2) all of the restricted
stock then otherwise subject to repurchase by the Company shall be deemed to be
fully vested (i.e. no longer subject to a right of repurchase or restriction by
the Company), (3) all of the shares underlying restricted stock units then
otherwise subject to


 


8





















 


future
grant or award shall be fully granted, vested and distributed and no longer
subject to a right of repurchase by the Company or to any other performance
conditions, and (4) all then-vested and exercisable options (including for
the avoidance of doubt the options becoming exerciseable pursuant to this
paragraph) shall continue to be exercisable by the Executive for the Severance
Period (but not later than the original expiration date of such options).


 


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


 


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


 


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


 


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


 


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


 


(i)            The
Company shall pay the Executive, in a lump sum, in cash, within 60 days
after the Date of Termination, the sum of (A) the Executive’s base salary
through the Date of Termination and (B) the amount of any compensation
previously deferred by the Executive, in each case to the extent not previously
paid; and


 


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


 


9














 


4.3           Taxes.


 


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


 


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


 


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


 


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


 


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


 


(d)           Any
payments or other benefits otherwise due to the Executive following a Change in
Ownership or Control that could reasonably be characterized (as determined by
the Company) as Contingent Compensation Payments (the “Potential Payments”)
shall not be made until the dates provided for in this Section 4.3(d).  Within 10 days after each


 


10

















 


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


 


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


 


4.4           Mitigation.  For the avoidance of doubt, the Executive
shall not be required to mitigate the amount of any payment or benefits
provided for in this Section 4 by seeking other employment or
otherwise.  Further, the amount of any
payment or benefits provided for in this Section 4 shall not be reduced by
any compensation earned by the Executive


 


11





















 


as
a result of employment by another employer, by retirement benefits, by offset
against any amount claimed to be owed by the Executive to the Company or
otherwise.


 


4.5           Distributions.


 


(a)           Subject to this Section 4.5, payments or benefits
under Section 4 of this Agreement shall begin only upon the date of
Executive’s “separation from service” (determined as set forth below) which
occurs on or after the Date of Termination. 
The following rules shall apply with respect to distribution of the
payments and benefits, if any, to be provided to Executive under Section 4
of the Agreement, as applicable:


 


(i)            It
is intended that each installment of the payments and benefits provided under Section 4
of the Agreement shall be treated as a separate “payment” for purposes of  Section 409A of the Internal Revenue
Code of 1986, as amended, and the final Treasury regulations and guidance
issued thereunder (“Section 409A”). 
Neither the Company nor Executive shall have the right to accelerate or
defer the delivery of any such payments or benefits except to the extent
specifically permitted or required by Section 409A.


 


(ii)           If,
as of the date of Executive’s “separation from service” from the Company,
Executive is not a “specified employee” (each, for purposes of the Agreement,
within the meaning of Section 409A), then each installment of the payments
and benefits shall be made on the dates and terms set forth in Section 4
of the Agreement.


 


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


 


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


 


Each installment of the payments and benefits due under Section 4
of the Agreement that is not described in this Section 4.5(a)(iii)(A) and
that would, absent this subsection, be paid within the six-month period
following Executive’s separation from service from the Company shall not be
paid until the date that is six months and one day after such separation from
service (or, if earlier, Executive’s death), with any such installments that
are required to be delayed being accumulated during the six-month period and
paid in a lump sum on the date that is six months and one day following
Executive’s separation from service and any subsequent installments, if any,
being paid in accordance with the dates and terms set forth herein; provided,
however, that the preceding provisions of this sentence shall not apply to any
installment of payments and benefits if and to the maximum extent that that
such installment is deemed to be paid under a separation pay plan that does not
provide for a deferral of compensation by reason of the application of Treasury
Regulation Section 1.409A-1(b)(9)(iii) (relating to separation pay upon an
involuntary separation from service). 
Any installments that qualify for the exception under Treasury


 


12





















 


Regulation Section 1.409A-1(b)(9)(iii) must be paid no later
than the last day of Executive’s second taxable year following the taxable year
in which the separation from service occurs


 


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


 


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


 


5.     Disputes;
Expenses.


 


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


 


5.2           Expenses.  Subject to Section 4.5, the Company
agrees to pay as incurred, the expenses of one law firm to review and negotiate
this Agreement, and, to the fullest extent permitted by law, all legal,
accounting and other fees and expenses which the Executive may reasonably incur
as a result of any claim or contest (regardless of the outcome thereof) by the
Company, the Executive or others regarding the validity or enforceability of,
or liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Executive
regarding the amount of any payment or benefits pursuant to this Agreement),
plus in each case interest on any delayed payment at the applicable rate for
prejudgment interest then in effect in the Commonwealth of Massachusetts.


 


5.3           Compensation
During a Dispute.  Subject to Section 4.5,
if rights of the Executive to receive benefits under Section 4 (or the
amount or nature of the benefits to which he is entitled to receive) are the
subject of a dispute between the Company and the Executive, the Company shall
continue (a) to pay to the Executive the Executive’s base salary in effect
as of the Measurement Date and (b) to provide benefits to the Executive
and the Executive’s family at least equal to those which would have been
provided to them, if the Executive’s employment had not been terminated, in
accordance with the applicable Benefit Plans in effect on the Measurement Date,
until such dispute is resolved. 
Following the resolution of such dispute, the sum of the payments made
to the Executive under clause (a) of this Section 5.3 shall be
deducted


 


13





















 


from
any cash payment which the Executive is entitled to receive pursuant to Section 4;
and if such sum exceeds the amount of the cash payment which the Executive is
entitled to receive pursuant to Section 4, the excess of such sum over the
amount of such payment shall be repaid (without interest) by the Executive to
the Company within 120 days of the resolution of such dispute.


 


6.     Successors.


 


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


 


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


 


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


 


8.     Miscellaneous.


 


8.1           Non-Disclosure and Non-Competition and
Non-Solicitation.  The Executive acknowledges and reaffirms the
Executive’s obligations with respect to non-


 


14





















 


disclosure,
non-competition, and non-solicitation (and any other restrictions) reflected in
the Proprietary and Confidential Information and Non-Competition and
Non-Solicitation Agreement dated as of July 1, 2009 attached hereto.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


8.10         Entire
Agreement.  Except as set forth in
this Section 8.10, this Agreement sets forth the entire agreement of the parties
hereto in respect of the subject matter contained herein and supersedes all
prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer,
employee or representative of any party hereto in respect of the subject matter
contained herein; and any prior agreement of the parties hereto in respect of
the subject matter contained herein is hereby terminated and cancelled.  Notwithstanding the preceding sentence, the
agreement referenced in Section 8.1 remains in full force and effect.


 


15





















 


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


 


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


 


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


 


ASPEN
TECHNOLOGY, INC.


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Mark E. Fusco

  	
   

  
	
   

  	
  President &
  CEO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Name of executive]

  	
   

  
	
   

  	
   

  
	
  Address:

  	
   

  
	
   

  	
   

  



 


16

















 


Exhibit A


 


GENERAL RELEASE OF
CLAIMS


 


This General Release of
Claims (the “General Release”) is being executed by
                              
(“Employee”), for and in consideration of certain amounts payable under the
                                
(the “Agreement”) entered into between him and Aspen Technology, Inc. (the
“Company”), dated as of
                        .  Employee agrees as follows:


 


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


 


17

















 


of insurance maintained
by the Company; and (iv) any rights that the Employee has under the
Agreement.


 


Employee acknowledges
that he has been given at least twenty-one (21) days to consider this General
Release, and that the Company advised him to consult with an attorney of his
own choosing prior to signing this General Release. Employee understands that
he may revoke this General Release for a period of seven (7) days after he
signs this General Release by notifying the Company’s General Counsel, in
writing, and the General Release shall not be effective or enforceable until
the expiration of this seven (7) day revocation period.  Employee understands and agrees that by
entering into this General Release, he is waiving any and all rights or claims
he might have under the Age Discrimination in Employment Act, as amended by the
Older Workers Benefits Protection Act, and that he has received consideration
beyond that to which he was previously entitled.


 


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


 


ASPEN TECHNOLOGY, INC.


 


	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  



 


18