Document:

Form of restricted stock unit grant agmt. for members of the Board

 Exhibit 10.4 
 Director RSU Agreement 
 Grant Tracking ID # ____ 
 SUN MICROSYSTEMS, INC. 
 2007 OMNIBUS
INCENTIVE PLAN 
 RESTRICTED STOCK UNIT AGREEMENT 
 You (“Grantee”) have been granted restricted stock units (“RSUs”) relating to shares of common stock, $.001 par value per share (the “Stock”), of Sun Microsystems, Inc., a Delaware
corporation (“Sun”), subject to the vesting conditions set forth in this Award Agreement. Additional terms and conditions of the grant are set forth in this Award Agreement and in Sun’s 2007 Omnibus Incentive Plan (the
“Plan”). 
 Grant Date:
                    , 200       
 Name of Grantee:                                 

 Number of RSUs Covered by the Grant:
                     
 Vesting Start Date:
                     
 Vesting Schedule:

 In the event that the Schedule set forth below would result in vesting of a fractional number of RSUs, the number of RSUs that will vest
will be rounded down to the nearest whole share, and the last scheduled vesting tranche will be rounded up, to the extent necessary, so that the full number of RSUs will have vested. 
  

			
	 Vesting Date
	  	Number of RSUs that vest, as
		  	a fraction of the number of
		  	RSUs granted
		
	 The one-year anniversary of the Vesting Start Date
	  	20%
		
	 The two-year anniversary of the Vesting Start Date
	  	20%
		
	 The three-year anniversary of the Vesting Start Date
	  	20%
		
	 The four-year anniversary of the Vesting Start Date
	  	20%
		
	 The five-year anniversary of the Vesting Start Date
	  	20%

  

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 By signing this Award Agreement below and returning it to: 
 Global Stock Plan Services 
 Sun Microsystems 
 SCA 22-120 
 4220 Network Circle 
 Santa Clara, CA 95054 
 within 60 days of the Grant Date, you agree to all of the terms and conditions described in the Award
Agreement and in the Plan, a copy of which may be viewed along with the Plan prospectus on Sun’s intranet at http://stockplans.central. You acknowledge that you have carefully reviewed the Plan and agree that the Plan will control in the event
any provision of this Award Agreement should appear to be inconsistent. If you do not sign and return this Award Agreement within the 60-day period, this Award Agreement and grant of RSUs will be null and void. 
  

			
	By:	 	 
		
	Name:	 	 
		
	Date:	 	 
		 	

 This is not a stock certificate or a negotiable instrument. 
  

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 SUN MICROSYSTEMS, INC. 
 2007 OMNIBUS INCENTIVE PLAN 
 RESTRICTED STOCK UNIT AGREEMENT 
  

			
		
	RSU Transferability	  	This grant is an award of RSUs in the number of units set forth on the first page of this Award Agreement, subject to the vesting conditions described in this Award Agreement. Your RSUs may
not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the RSUs be made subject to execution, attachment or similar process.
		
	Definitions	  	Capitalized terms used but not defined in this Award Agreement are defined in the Plan, and have the meanings set forth in the Plan.
		
	Vesting	  	Your RSUs vest as to the number of units indicated in the Vesting Schedule and on the Vesting Dates shown on the first page of this Award Agreement, provided you are in Service on each of the
Vesting Dates and meet the applicable vesting requirements set forth in this Award Agreement. Except as specifically provided in this Award Agreement, or as may be provided in other agreements between you and Sun, no additional RSUs will vest after
your Service has terminated for any reason.
		
	Share Delivery Pursuant to Vested RSUs	  	Shares of Stock underlying vested RSUs will be delivered to you by Sun as soon as practicable following the applicable Vesting Dates, but in no event beyond 2 1
/2 months after the end of the calendar year in which the shares otherwise would have been delivered. The purchase price for the vested shares of Stock is
considered paid by your services to Sun.
		
	Forfeiture of Unvested RSUs	  	Except as specifically provided in this Award Agreement, or as may be provided in other agreements between you and Sun, no additional RSUs will vest after your Service has terminated for any
reason. In the event that your Service terminates for any reason, you will forfeit to Sun all of the RSUs that have not yet vested or with respect to which all applicable restrictions and conditions have not lapsed.
		
	Death	  	If your Service terminates because of your death, the RSUs granted under this Award Agreement will automatically vest as to the number of RSUs that would have vested if you had remained in
Service for the twelve-month period immediately following your death.

  

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	Disability	  	If your Service terminates because of your Disability, the RSUs granted under this Award Agreement will automatically vest as to the number of RSUs that would have vested if you had remained
in Service for the twelve-month period immediately following your Disability.
		
	Termination For Cause	  	If your Service is terminated for Cause, then you shall immediately forfeit all your rights to the RSUs granted under this Award Agreement.
		
	Withholding Taxes	  	Regardless of any action Sun takes with respect to any income tax, social insurance, payroll tax, payment on account or other tax-related withholding with respect to this Award Agreement
(“Tax-Related Items”), you acknowledge that the ultimate liability for all Tax-Related Items is your responsibility and that Sun:
		
		  	 •        is not making any representations and is not committing to take any actions regarding
any Tax-Related Items, including, but not limited to, the grant of the RSUs, the vesting of the RSUs, the delivery of shares of Stock upon vesting of the RSUs, the subsequent sale of shares of Stock acquired upon vesting of the RSUs, and the receipt
of any dividends; and

		
		  	 •        does not commit to structure the terms of the grant or any aspect of the RSUs to
reduce or eliminate your liability for Tax-Related Items.

		
		  	Before any Tax-Related Items become due, you will pay or make adequate arrangements satisfactory to Sun to satisfy those Tax-Related Items. If permissible under local law, you authorize Sun
to withhold all applicable Tax-Related Items legally payable by you by one or a combination of the following:
		
		  	 •        withholding from cash compensation paid to you by Sun;

		
		  	 •        withholding proceeds from the sale of shares of Stock acquired upon vesting of the
RSUs;

		
		  	 •        arranging for the sale of shares of Stock acquired upon vesting of the RSUs; and/or

  

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		  	 •        withholding shares of Stock otherwise deliverable to you, provided that Sun only
withholds the number of shares of Stock necessary to satisfy the minimum withholding amount or such other amount as determined by Sun not to result in negative accounting consequences, rounding up to the nearest whole share of
Stock.

		
		  	If the obligation for Tax-Related Items is satisfied by withholding a number of shares of Stock as described herein, you will be deemed to have been issued the full number of shares of Stock
to which you are entitled pursuant to the vesting of the RSUs even though a portion of those shares of Stock will be withheld for the purpose of satisfying the Tax-Related Items.
		
		  	Further, if you have relocated to a different jurisdiction between the date of grant and the date of any taxable event, you acknowledge that Sun may be required to withhold or account for
Tax-Related Items in more than one jurisdiction.
		
		  	Finally, you will pay to Sun any amount of Tax-Related Items that Sun may be required to withhold or account for as a result of your participation in the Plan or any aspect of the RSUs that
cannot be satisfied by any of the means described in the preceding paragraph. Sun may refuse to deliver shares of Stock to you if you fail to meet your obligations for the Tax-Related Items, as described in this section.
		
	Nature of Grant	  	In accepting the RSUs, you acknowledge that:
		
		  	 •        the Plan was established voluntarily by Sun, it is discretionary in nature and it may
be modified, amended, suspended or terminated by Sun at any time, unless otherwise provided in the Plan and this Award Agreement;

		
		  	 •        the grant of the RSUs is voluntary and occasional and does not create any contractual
or other right to receive future RSUs, or benefits in lieu of RSUs even if RSUs have been granted repeatedly in the past;

		
		  	 •        all decisions with respect to future grants of RSUs, if any, will be at the sole
discretion of Sun;

		
		  	 •        your participation in the Plan is voluntary;

  

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		 	 •        the RSUs and any shares or Stock acquired under the Plan are extraordinary items that
do not constitute compensation of any kind for Service of any kind rendered to Sun;

		
		 	 •        the RSUs and any shares of Stock acquired under the Plan are not part of normal or
expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or welfare or retirement benefits or
similar payments and in no event should be considered as compensation for, or relating in any way to, past services for Sun;

		
		 	 •        the RSUs will not be interpreted to form an employment contract or relationship with
Sun or any Affiliate or Subsidiary;

		
		 	 •        the future value of the underlying shares of Stock is unknown and cannot be predicted
with certainty;

		
		 	 •        in consideration of the grant of the RSUs, no claim for compensation or damages may
be made as a result of the termination of the RSUs or from a reduction in value of the RSUs or shares of Stock acquired upon vesting of the RSUs as a result of your termination of Service (for any reason whatsoever and whether or not in breach of
local labor laws) and you irrevocably release Sun from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by accepting this Award Agreement, you have
irrevocably waived your entitlement to pursue such a claim;

		
		 	 •        Sun is not providing any tax, legal or financial advice, nor is Sun making any
recommendations regarding your participation in the Plan; and

		
		 	 •        you should consult with personal tax, legal and financial advisors regarding
participation in the Plan before taking any action related to the Plan.

  

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	Stockholder Rights	  	You do not have any of the rights of a stockholder with respect to the RSUs unless and until the shares of Stock relating to the RSUs have been delivered to you (or an appropriate book entry
has been made). In the event of a cash dividend on outstanding Stock, you will be entitled to receive a cash payment for each of your RSUs. Sun may, in its sole discretion, require that dividends will be reinvested in additional RSUs at Fair Market
Value on the dividend payment date, subject to vesting and delivered at the same time as the related RSUs.
		
	Forfeiture of Rights	  	To the extent permitted by applicable law, you agree that while you are a Service Provider and for a period of twelve months immediately following your termination of Service, you shall not,
directly or indirectly, solicit, induce, recruit or encourage any employees of Sun to leave their employment, either for yourself or any other person or entity. If you should take any of the actions described in the preceding sentence, Sun shall
have the right to cause a forfeiture of your rights, including, but not limited to, the right to cause:
		
		  	 •        a forfeiture of the RSUs subject to this Award Agreement; and

		
		  	 •        with respect to the period commencing twelve months prior to and ending twelve months
following your termination of Service:

		
		  	 •        a forfeiture of any shares of Stock acquired by you upon the vesting of the RSUs; and

		
		  	 •        a forfeiture of any gain recognized by you upon the sale of shares of Stock acquired
by you upon the vesting of the RSUs.

		
	Adjustments	  	In the event of a recapitalization, a stock split, a stock dividend or a similar change in Sun stock, including any change described in the Plan, the number of RSUs covered by this grant will
be adjusted in accordance with the terms of the Plan. The RSUs will be subject to the terms of the agreement of merger, liquidation or reorganization in the event Sun is subject to such corporate activity.
		
	Applicable Law and Venue	  	This Award Agreement will be interpreted and enforced under the laws of the State of Delaware, United States of America, without giving effect to the conflict of laws principles of that
State. Any suit, action or other legal proceeding that is commenced to resolve any matter arising

  

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		  	under or relating to this Award Agreement or the Plan shall be commenced only in a court in the State of Delaware and the parties to this Award Agreement consent to the exclusive jurisdiction
of such court. To the extent applicable, you agree to waive your rights to a jury trial for any claim or cause of action based upon or arising out of this Award Agreement or the Plan or any dealings between you and Sun relating to the subject matter
of this Award Agreement or the Plan.
		
	Data Privacy Notice and Consent	  	You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this Award Agreement by and
among, as applicable, Sun and any Subsidiary or Affiliate for the exclusive purpose of implementing, administering and managing your participation in the Plan.
		
		  	You understand that Sun and any Subsidiary or Affiliate may hold certain personal information about you, including, but not limited to, your name, home address and telephone number,
date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Stock or directorships held in Sun, details of all RSUs or any other entitlement to shares of Stock awarded, canceled, exercised,
vested, unvested or outstanding in your favor, for the purpose of implementing, administering and managing the Plan (“Data”).
		
		  	You understand that Data will be transferred to any third parties assisting Sun with the implementation, administration and management of the Plan, that these recipients may be located
in your country or elsewhere, and that the recipient’s country may have different data privacy laws and protections than your country. You understand that you may request a list with the names and addresses of any potential recipients of the
Data by contacting your local human resources representative. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your
participation in the Plan, including any requisite transfer of Data as may be required to a broker or other third party with whom you may elect to deposit any shares of Stock acquired under the Plan. You understand that Data will be held only as
long as is necessary to implement, administer

  

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		  	and manage your participation in the Plan. You understand that you may, at any time, view Data, request additional information about the storage and processing of Data, require any
necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative. You understand, however, that refusing or withdrawing your consent may affect your
ability to participate in the Plan. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.
		
	Consent to Electronic Delivery and Participation	  	Sun may, in its sole discretion, decide to deliver any documents related to your participation in the Plan, including statutory materials related to the Plan and future grants of restricted
stock units under the Plan, by electronic or hard copy means or request your consent to participate in the Plan by electronic or hard copy means. You hereby consent to receive such documents by electronic or hard copy delivery and, if requested, to
agree to participate in the Plan through an on-line or electronic system established and maintained by Sun or a third-party designated by Sun. Additionally, by accepting this grant of RSUs, you agree that Sun may deliver the Plan prospectus and
Sun’s annual report to you in an electronic format. The Plan prospectus is located at http://stockplans.central.
		
	Language	  	If you have received this Award Agreement or any other Plan document translated into a language other than English and if the translated version is different from the English version, the
English version will control, unless otherwise prescribed by local law.
		
	The Plan	  	The text of the Plan is incorporated in this Award Agreement by reference.
		
		  	This Award Agreement and the Plan constitute the entire understanding between you and Sun regarding this grant of RSUs. Any prior agreements, commitments or negotiations concerning this grant
are superseded.
		
	Business Days	  	To the extent the expiration of a relevant period occurs on a day on which Sun is not scheduled to conduct business (e.g., a Saturday, Sunday or a U.S. federal holiday), the expiration
of the relevant period will occur on Sun’s last business day preceding that date.

  

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	Severability	  	The provisions of this Award Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions
shall be binding and enforceable.
		
	Additional Terms and Conditions	  	If you relocate to another country, any special terms and conditions applicable to RSUs granted in such country may apply to you, to the extent Sun determines that the application of such
terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.
		
		  	In addition, Sun reserves the right to impose other requirements on the RSUs and any shares of Stock acquired under the Plan, to the extent Sun determines it is necessary or advisable in
order to comply with local law or facilitate the administration of the Plan, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

  

 - 10 -Form of Change of Control Agreement - executive officers

 Exhibit 10.13 
 August 1, 2008 
 [name] 
 [address] 
 Dear [name]: 
 Sun
Microsystems, Inc. (the “Company”), considers it essential to the best interests of its stockholders to attract top executives and to foster the continuous employment of key management personnel. In this connection, the Board of Directors
of the Company (the “Board”) recognizes that the possibility of a change of control may exist and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of
management personnel to the detriment of the Company and its stockholders. 
 The Board has determined that appropriate steps should be taken
to ensure the continuity of management and to foster objectivity in the face of potentially disturbing circumstances arising from the possibility of a change of control of the Company, although no such change is now contemplated. In order to induce
you to remain in the employ of the Company and in consideration of your further services to the Company, the Company agrees that effective as of [date], you shall receive the severance benefits from the Company, set forth in this letter
agreement (“Agreement”) in the event you Separate from Service with the Company and all related entities (collectively, “Sun”) subsequent to a Change of Control of the Company (as defined in Section 2(d) hereof) under the
circumstances described below. This Agreement supersedes and replaces prior agreements and/or policies related to severance benefits payable to you following a Change of Control of the Company (including the letter agreement between you and the
Company dated                 , 200_ as specified in Section 11 of such agreement). 
 1. Term of Agreement. This Agreement shall commence on the date hereof and shall continue in effect until the earlier of (i) your Separation from Service other than within twelve (12) months of a
Change of Control; (ii) such time as you no longer are a Corporate Executive Officer of the Company (and thereby no longer a member of the ‘Executive Leadership Team’) other than within twelve (12) months of a Change of Control;
(iii) the Company’s satisfaction of all of its obligations under this Agreement; or (iv) the execution of a written agreement between the Company and you terminating this Agreement. 
 2. Definitions. As used in this Agreement: 
  

	 	(a)	“Annual Compensation” means the total of: 

  

	 	(i)	one year of base salary, at the highest base salary rate that you were paid by the Company in the 12-month period prior to the date of your Separation from Service (the
“Look-Back Period”); 

  

	 	(ii)	100% of the greatest On Target annual bonus target for which you were eligible within the Look-Back Period; and 

  

	 	(iii)	100% of the greatest On Target Commission for which you were eligible within the Look-Back Period. 

  

 1 

	 	(b)	“Beneficial Owner” has the meaning ascribed to such term in Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). 

  

	 	(c)	“Cause” means (i) any act of personal dishonesty taken by you in connection with your responsibilities as an employee and intended to result in
substantial personal enrichment to you; (ii) use, possession, sale, or distribution of illegal substances; (iii) your acknowledgment or conviction of, fraud or any crime in which the Board reasonably believes has or could have a material
detrimental effect on the Company’s reputation or business; (iv) conduct endangering, or likely to endanger, the health or safety of another employee, or (v) falsifying or misrepresenting information on Company records.

  

	 	(d)	“Change of Control” of the Company means and includes each and all of the following occurrences: 

  

	 	(i)	The stockholders of the Company approve a merger or consolidation of the Company with any other corporation, 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 or its parent company) more than fifty percent
(50%) of the total voting power represented by the voting securities of the Company or such surviving entity, or its parent company, outstanding immediately after such merger or consolidation, or the stockholders of the Company approve a plan
of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all the Company’s assets. 

  

	 	(ii)	The acquisition by any Person as Beneficial Owner, 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. 

  

	 	(iii)	A change in the composition of the Board as a result of which fewer than a majority of the directors are “Incumbent Directors.” “Incumbent Directors” shall mean
directors who either (A) are directors of the Company as of the date hereof or (B) are elected, or nominated for election, to the Board with the affirmative votes (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 election as a director without objection to such nomination) of at least three-quarters of the Incumbent Directors at the time of such election or nomination (but shall not include an individual
whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors of the Company). 

 Any other provision of this Section 2 notwithstanding, the term Change in Control shall not include either of the following events undertaken at the election of the Company: 
  

	 	(x)	Any transaction, the sole purpose of which is to change the state of the Company’s incorporation; or 

  

 2 

	 	(y)	A transaction, the result of which is to sell all or substantially all of the assets of the Company to another corporation (the “surviving corporation”); provided that the
surviving corporation is owned directly or indirectly by the stockholders of the Company immediately following such transaction in substantially the same proportions as their ownership of the Company’s Common Stock immediately preceding such
transaction; and provided, further, that the surviving corporation expressly assumes this Agreement. 

  

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

  

	 	(f)	“Company” means Sun Microsystems, Inc., a Delaware corporation, and any successor as provided in Section 8 hereof. 

  

	 	(g)	“Disability” means that, at the time you Separate from Service, you have been unable to perform the duties of your position for a period of 180 consecutive
days as the result of your incapacity due to physical or mental illness. 

  

	 	(h)	“Good Reason” means the occurrence of one of the following without your express written consent (i) a significant reduction of your duties, position or
responsibilities, or your removal from such position and responsibilities, unless you are offered a comparable position (i.e., a position of equal or greater organizational level, duties, authority, compensation, title and status); (ii) a
reduction by the Company in your base compensation (base salary and target bonus) as in effect immediately prior to such reduction; (iii) a material reduction by the Company in the kind or level of employee benefits to which you are entitled
immediately prior to such reduction with the result that your overall benefits package is significantly reduced; (iv) you are requested to relocate (except for office relocations that would not increase your one way commute by more than 50
miles); or (v) the failure of the Company to obtain the assumption of this Agreement pursuant to Section 8. 

  

	 	(i)	“Key Employee” means an employee who is determined by the Company to be a Key Employee in accordance with Section 409A of the Code.

  

	 	(j)	“Person” has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d) and 14(d) thereof, including a group
as defined in Section 13(d) of the Exchange Act but excluding the Company and any subsidiary and any employee benefit plan sponsored or maintained by the Company or any subsidiary (including any trustee of such plan acting as Trustee).

  

	 	(k)	“Separation from Service” or “Separates from Service” means a termination of employment with Sun that the Company determines is a
Separation from Service in accordance with Section 409A of the Code. 

  

	 	(l)	“Severance Payment” means the payment of severance compensation as provided in Section 3 of this Agreement. 

  

 3 

 3. Compensation Upon Separation from Service Following a Change of Control. If you Separate from Service on
account of (i) an involuntary termination without Cause or (ii) a voluntary termination for Good Reason, within twelve (12) months after a Change in Control, then subject to (x) your signing and not revoking a separation
agreement and release of claims in a form reasonably satisfactory to the Company and (y) Sections 4 and 5 below: 
  

	 	(a)	You will be entitled to a Severance Payment in an amount computed as follows: 

  

	 	(i)	A lump sum payment, paid in accordance with subsection (c) below, equal to two and one-half (2-1 /2) times your Annual Compensation; plus 

  

	 	(ii)	The same percentage of Company-paid health and group-term life insurance benefits as were provided to you and your family under plans of the Company as of the Change of Control for
a total of twenty-four (24) months, provided that all payments be made prior to December 31 of the second year following the year in which you Separate from Service. Notwithstanding the foregoing, the Company may, at its option, satisfy
any requirement that the Company provide coverage under any plan by instead providing coverage under a separate plan or plans providing coverage that is no less favorable. 

  

	 	(b)	The Company agrees that, in addition to the payments and benefits provided under Section 3(a), all outstanding unvested stock options, restricted stock, performance shares and
stock appreciation rights previously granted to you under any Company equity or long-term incentive plan or program (a “Company Incentive Plan”) (including any stock options, restricted stock, performance shares and stock appreciation
rights assumed by the Company in connection with its acquisition of another entity) shall immediately be 100% vested upon such Separation from Service. You shall be entitled to exercise any stock options or stock appreciation rights until the
expiration of three months following your Separation from Service (or until such later date as may be applicable under the terms of the award agreement governing the stock option or stock appreciation right upon termination of employment), subject
to the maximum full term of the stock option or stock appreciation right. In addition, the Company agrees that all restricted stock units, performance-based restricted stock units, and long-term incentive cash programs (“Long-Term
Incentives”) previously granted to you under any Company Incentive Plan shall immediately be 100% vested upon such Separation from Service; however, the issuance or payment of such restricted stock units, performance-based restricted stock
units or Long-Term Incentives shall be governed by your applicable grant or award agreement. Notwithstanding the immediately preceding sentence, in no event will the 100% vesting apply to restricted stock units, performance-based restricted
stock units or Long-Term Incentives if the 100% vesting would cause adverse tax consequences under Code Sec. 409A. 

  

	 	 (c)
	 If you are not a Key Employee, all payments made to you under subsection (a) shall be made on the forty-fifth (45
th) calendar day following your Separation from Service (or as soon as administratively practicable thereafter), provided that your separation
agreement and release of claims referenced above must be effective and not revocable on the date payment is to be made in order to receive payments under subsection (a). If you are a Key Employee, all payments made to you under subsection
(a) shall be made as soon as administratively practicable following the six-month anniversary of the date of your Separation from Service, provided that no Severance Payment shall be made to you if the separation agreement and release of claims
referenced above have not become effective as of the six-month anniversary of the date of your Separation from Service. 

  

 4 

	 	 
Notwithstanding anything contained in subsections (a) and (b) above, the Company shall have no obligation to make any payment or offer any benefits
to you under this Section 3 if you Separate from Service prior to a Change in Control or if you Separate from Service within twelve (12) months after a Change in Control for Cause, death, Disability, retirement or voluntary resignation
other than for Good Reason or if you Separate from Service for any reason after twelve (12) months following a Change in Control. 

 4. Parachute Payments. In the event that any payment or benefit received or to be received by you in connection with your Separation from Service with the Company (collectively, the “Severance Parachute Payments”) would
(i) constitute a parachute payment within the meaning of Section 280G of the Code or any similar or successor provision to 280G and (ii) but for this Section 4, be subject to the excise tax imposed by Section 4999 of the
Code or any similar or successor provision to Section 4999 (the “Excise Tax”), then such Severance Parachute Payments shall be reduced to the largest amount which would result in no portion of the Severance Parachute Payments being
subject to the Excise Tax. In the event any reduction of benefits is required pursuant to this Agreement, you shall be allowed to choose which benefits hereunder are reduced (e.g., reduction first from the Severance Payment, then from the vesting
acceleration). Any determination as to whether a reduction is required under this Agreement and as to the amount of such reduction shall be made in writing by the independent public accountants appointed for this purpose by the Company (the
“Accountants”) prior to, or immediately following, the Change of Control, whose determinations shall be conclusive and binding upon you and the Company for all purposes. If the Internal Revenue Service (the “IRS”) determines that
the Severance Parachute Payments are subject to the Excise Tax, then the Company or any related corporation, as their exclusive remedy, shall seek to enforce the provisions of Section 5 hereof. Such enforcement of Section 5 below shall be
the only remedy, under any and all applicable state and federal laws or otherwise, for your failure to reduce the Severance Parachute Payments so that no portion thereof is subject to the Excise Tax. The Company or related corporation shall reduce
the Severance Parachute Payments in accordance with this Section 4 only upon written notice by the Accountants indicating the amount of such reduction, if any. The Company shall bear all costs the Accountants may reasonably incur in connection
with any calculations contemplated by this Agreement. 
 5. Remedy. If, notwithstanding the reduction described in Section 4 hereof, the IRS
determines that you are liable for the Excise Tax as a result of the receipt of a Severance Parachute Payment, then you shall, subject to the provisions of this Agreement, be obligated to pay to the Company (the “Repayment Obligation”) an
amount of money equal to the Repayment Amount (defined below). The “Repayment Amount” with respect to the Severance Parachute Payments shall be the smallest such amount, if any, as shall be required to be paid to the Company so that your
net proceeds with respect to any Severance Parachute Payments (after taking into account the payment of the Excise Tax imposed on such Severance Parachute Payments) shall be maximized. Notwithstanding the foregoing, the Repayment Amount with respect
to the Severance Parachute Payments shall be zero if a Repayment Amount of more than zero would not eliminate the Excise Tax imposed on such Severance Parachute Payment. If the Excise Tax is not eliminated through the performance of the Repayment
Obligation, you shall pay the Excise Tax. The Repayment Obligation shall be performed within thirty (30) days of either (i) your entering into a binding agreement with the IRS as to the amount of your Excise Tax liability or (ii) a
final determination by the IRS or a decision by a court of competent jurisdiction requiring you to pay the Excise Tax with respect to the Severance Parachute Payments from which no appeal is available or is timely taken. 
 6. No Mitigation. You shall not be required to mitigate the amount of any payment provided for in Section 3 hereof by seeking other employment or otherwise,
nor shall the amount of such payment be reduced by reason of compensation or other income you receive for services rendered after your Separation from Service from the Company. 
 7. Exclusive Remedy. In the event of your Separation from Service on account of an involuntary termination without Cause or a voluntary termination for Good Reason within twelve (12) months following a
Change of Control, the provisions of Section 3 are intended to be and are exclusive and in lieu of any other rights or remedies to which you or the Company may otherwise be entitled (including any contrary provisions in any employment agreement
you may have with the Company), whether at law, tort or contract, in equity, or under this Agreement. 
  

 5 

 8. Company’s Successors. The Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, to expressly assume and agree to perform the obligations under this Agreement in the same manner and to the same extent that the Company
would be required to perform if no such succession had taken place. As used in this Section 8, Company includes any successor to its business or assets as aforesaid which executes and delivers this Agreement or which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law. 
 9. Notice. Notices and all other communications provided for in this Agreement
shall be in writing and shall be deemed to have been duly given when personally delivered or five (5) days after deposit with postal authorities transmitted by United States registered or certified mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth on the first or last page of this Agreement, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt. 
 10. Amendment or Waiver. No provisions of this Agreement may be amended, modified, waived or
discharged unless you and the Company agree to such amendment, modification, waiver or discharge in writing. No amendment, modification, waiver or discharge of this Agreement shall result in the accelerated payment of any Severance Payment provided
for in Section 3. No waiver by either party at any time of the breach of, or lack of compliance with, any conditions or provisions of this Agreement shall be deemed a waiver of the provisions or conditions hereof. 
 11. Sole Agreement. This Agreement represents the entire agreement between you and the Company with respect to the matters set forth herein and supersedes and
replaces any prior agreements in their entirety. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter of this Agreement will be made by either party which are not set forth expressly herein. No
future agreement between you and the Company may supercede this Agreement, unless it is in writing and specifically makes reference to this Section 11. 
 12. Employee’s Successors. This Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you
should die while any amounts are still payable to you hereunder, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee, or other designee or, if there be no such
designees, to your estate. 
 13. Funding. This Agreement shall be unfunded. Any payment made under the Agreement shall be made from the
Company’s general assets. 
 14. Waiver. No waiver by either party of any breach of, or of compliance with, any condition or provision of this
Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time. 
 15.
Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement. 
 16.
Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect. 
 17. Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable income and employment taxes. 
  

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 18. Applicable Law. This Agreement shall be interpreted and enforced in accordance with the laws of the State of
California (with the exception of its conflict of laws provisions). This Agreement is intended to comply with Section 409A of the Code and the regulations promulgated thereunder. 
 19. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument. 
 If the foregoing conforms to your understanding, please indicate your agreement to the terms hereof by signing where indicated below and returning one
copy of this Agreement to the undersigned. 
 IN WITNESS WHEREOF, this Agreement is executed effective as of the date set forth above.

  

	
	Sincerely,
	
	SUN MICROSYSTEMS, INC.
	
	  
	Michael A. Dillon
	Executive Vice President, General Counsel and Secretary

 ACCEPTED AND AGREED TO AS OF THE 
 DATE FIRST SET FORTH ABOVE: 
  

	
	
	  
	[name]

  

 7

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