Document:

Prepared by MERRILL CORPORATION

 

Exhibit 10.2

 

CHANGE OF CONTROL AGREEMENT

 

                THIS CHANGE OF CONTROL AGREEMENT (the

"Agreement") is made as of August 23, 2001 between DOT HILL SYSTEMS CORP., a [Delaware]

corporation (the "Company"), and James L. Lambert

("Employee").

 

                WHEREAS, in order to provide an incentive

for Employee to participate actively in the affairs and maximize the value of

the Company, the Company is willing to provide Employee with certain benefits

on the terms and conditions set forth below.

 

                NOW THEREFORE, for good and valuable

consideration, the sufficiency of which is hereby acknowledged, Employee and

the Company (each, a "Party," and collectively, the

"Parties") agree as follows:

 

1.             BENEFITS IN THE EVENT OF A CHANGE

OF CONTROL.  If

a Change of Control (defined below) occurs then, without further action by

Employee or the Company, Employee shall be entitled to the benefits set forth

below:

 

                (a)           As

of immediately prior to such Change of Control, the vesting applicable to all

options to purchase shares of the Company's capital stock ("Options")

and all shares of the Company's capital stock which are subject to the

Company's right to repurchase such shares ("Restricted Stock") held

by Employee as of the effective date of such Change of Control shall be

accelerated in full such that Employee shall have the right to exercise in

accordance with the terms thereof all or any portion of such Options

(notwithstanding any vesting schedule set forth in such Options) and any such

Company repurchase rights with respect to such Restricted Stock shall lapse in

full; and

 

                (b)           Employee

shall be entitled to a lump sum cash payment in an amount equal to one hundred

fifty percent (150%) of Employee's annual base salary in effect as of the date

of such Change of Control (the "Lump Sum Payment"), subject to

applicable withholdings as required by applicable law, payable on the Effective

Date specified in a Release delivered by Employee to the Company following such

Change of Control in the form attached to Employee's Employment Agreement with

the Company dated August 2, 1999 (the "Employment Agreement"). The

Lump Sum Payment provided for in this Section 1(a)(ii) shall be reduced by the

amount of any cash severance payment made to Employee by the Company pursuant

to paragraph 10 of the Employment Agreement. Any payments made pursuant to

paragraph 10 of the Employment Agreement shall be reduced by the amount of any

cash payments made hereunder.

 

2.             DEFINITION.  For purposes of

this Agreement, "Change of Control" shall mean: (1) a dissolution or

liquidation of the Company; (2) any sale or transfer of all or substantially

all of the assets of the Company; (3) any merger, consolidation or similar

transaction in which the holders of the Company's outstanding voting securities

immediately prior to such transaction do not hold, immediately following such

transaction, securities representing fifty percent (50%) or more of the

combined voting power of the outstanding securities of the surviving entity; or

(4) the acquisition by any person (within the meaning of Section 13(d)(3) or

Section 14 (d)(2) of the Securities Exchange Act of 1934, as amended (the

"Exchange Act"), in a single transaction or series of related

transactions, of beneficial ownership (within the meaning of Rule 13d 3 or any

successor rule or regulation promulgated under the Exchange Act) of securities

representing fifty percent (50%) or more of the combined voting power of the

then-outstanding securities of the Company, excluding in any case shares of

capital stock of the Company purchased from the Company in a transaction the

principal purpose of which is to raise capital for the Company.

 

3.             GOLDEN PARACHUTE TAXES.  In the event that

any payment or distribution by the Company, or the grant of any benefit by the

Company, to or for the benefit of Employee (whether paid or payable,

distributed or distributable or granted or to be granted pursuant to the terms

of this Agreement or otherwise) (collectively, "Benefits") would be

nondeductible by the Company for federal income tax purposes because of Section

280G of the Internal Revenue Code (the "Code") and/or would cause

Employee to be liable for an excise tax pursuant to Section 4999 of the Code,

then the Benefits paid, distributed or granted to Employee under this Agreement

shall equal (i) the full amount of such Benefits or (ii) the Reduced Amount (as

defined below), whichever of the foregoing amounts is determined by the Company

to result, on an after-tax basis, in the receipt by Employee of the greatest

amount of such Benefits, notwithstanding that all or some portion of the

Benefits may be taxable under Section 4999 of the Code. In making its

determination pursuant to the preceding sentence, the Company shall take into

account all applicable Federal, state, and local employment and income taxes,

as well as the excise tax imposed by Section 4999 of the Code. For purposes of

this Section 4, the "Reduced Amount" shall be the maximum amount

payable to Employee that would result in no portion of the Benefits being (i)

nondeductible by the Company under Section 280G of the Code or (ii) subject to

an excise tax liability under Section 4999 of the Code. Notwithstanding the

foregoing and any other provision contained herein, in the event (as a result

of Benefits to be received under this Agreement or any other plan or

arrangement between the Employee and the Company) of any required reduction, as

a result of Section 4999 of the Code, of Benefits to be received by Employee,

reduction shall be made from such other plan or arrangement prior to any

reduction relating to Benefits to be received by Employee under this Agreement.

 

4.             GENERAL PROVISIONS.

 

                (a)           This

Agreement shall be governed by the laws of the State of California (without

regard to principles of conflict of laws).

 

                (b)           Any

notice, demand or request required or permitted to be given by either the

Company or Employee pursuant to the terms of this Agreement shall be in writing

and shall be deemed given when delivered personally or deposited in the U.S.

mail, First Class with postage prepaid, and addressed to the parties at such

addresses as have been previously furnished by the Parties or such other

address as a Party may request by notifying the other in writing.

 

                (c)           The

rights and obligations of Employee under this Agreement may not be transferred or

assigned without the prior written consent of the Company.

 

                (d)           This

Agreement is meant to supplement the terms of stock option agreement(s) or

other agreement(s) pursuant to which Employee acquired the Options, as well as

any written employment agreement between the Company and Employee. To the

extent that the terms and conditions of this Agreement are inconsistent with

those found in such stock option agreement(s) or other agreement(s) (employment

or otherwise), the terms and conditions of this Agreement shall be controlling.

 

                (e)           Any

Party's failure to enforce any provision or provisions of this Agreement shall

not in any way be construed as a waiver of any such provision or provisions,

nor prevent any Party from thereafter enforcing each and every other provision

of this Agreement. The rights granted the Parties herein are cumulative and

shall not constitute a waiver of any Party's right to assert all other legal

remedies available to it under circumstances.

 

                (f)            Employee

agrees upon request to execute any further documents or instruments necessary

or desirable to carry out the purposes or intent of this Agreement.

 

                (g)           In

case any provision of this Agreement shall be invalid, illegal or

unenforceable, the validity, legality and enforceability of the remaining

provisions shall not in any way be affected or impaired.

 

                (h)           This

Agreement, in whole or in part, may be modified, waived or amended upon the

written consent of the Company and Employee.

 

                (i)            Notwithstanding

anything to the contrary herein, nothing contained in this Agreement shall in

any way alter Employee's rights under the Employment Agreement except for the

last sentence of paragraph 1(b) above.

 

                (j)            This

Agreement may be executed in one or more counterparts, each of which shall be

deemed an original, but all of which shall constitute one instrument.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT

BLANK]

 

 

 

                IN WITNESS WHEREOF,

the undersigned have set their hand as of the date first above written.

 

	

   

  	

   

  	

  EMPLOYEE

  	

   

  	

   

  	

   

  	

   

  	

  DOT HILL SYSTEMS CORP.

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  /s/ James L.

  Lambert

  	

   

  	

   

  	

   

  	

   

  	

  /s/ Benjamin

  Brussell

  
	

   

  	

   

  	

  James L.

  Lambert

  	

   

  	

   

  	

   

  	

   

  	

  By:  Benjamin Brussell

  
	

   

  	

   

  	

  23-Aug-01

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  Director,

  Chairman - Comp Committee

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  Title:Prepared by MERRILL CORPORATION

 

Exhibit 10.3

 

CHANGE OF CONTROL AGREEMENT

 

                THIS CHANGE OF CONTROL AGREEMENT

(the "Agreement") is made as of August 23, 2001 between DOT HILL SYSTEMS CORP., a [Delaware]

corporation (the "Company"), and Preston Romm ("Employee").

 

                WHEREAS, in order to

provide an incentive for Employee to participate actively in the affairs and

maximize the value of the Company, the Company is willing to provide Employee

with certain benefits on the terms and conditions set forth below.

 

                NOW THEREFORE, for

good and valuable consideration, the sufficiency of which is hereby

acknowledged, Employee and the Company (each, a "Party," and

collectively, the "Parties") agree as follows:

 

1.             BENEFITS IN THE EVENT OF A CHANGE

OF CONTROL.

 

                (a)           If a Change of Control (defined

below) occurs then, without further action by Employee or the Company, Employee

shall be entitled to the benefits set forth below:

 

                                (i) As of

immediately prior to such Change of Control, the vesting applicable to all

options to purchase shares of the Company's capital stock ("Options")

and all shares of the Company's capital stock which are subject to the

Company's right to repurchase such shares ("Restricted Stock") held

by Employee as of the effective date of such Change of Control shall be

accelerated in full such that Employee shall have the right to exercise in

accordance with the terms thereof all or any portion of such Options

(notwithstanding any vesting schedule set forth in such Options) and any such

Company repurchase rights with respect to such Restricted Stock shall lapse in

full; and

 

                                (ii) Employee shall

be entitled to a lump sum cash payment in an amount equal to one hundred

twenty-five percent (125%) of Employee's annual base salary in effect as of the

date of such Change of Control (the "Lump Sum Payment"), subject to

applicable withholdings as required by applicable law, payable on the Effective

Date specified in a Release delivered by Employee to the Company following such

Change of Control in the form attached hereto as Exhibit A.

 

2.             DEFINITION.  For purposes of this Agreement, "Change

of Control" shall mean: (1) a dissolution or liquidation of the Company;

(2) any sale or transfer of all or substantially all of the assets of the

Company; (3) any merger, consolidation or similar transaction in which the

holders of the Company's outstanding voting securities immediately prior to

such transaction do not hold, immediately following such transaction,

securities representing fifty percent (50%) or more of the combined voting

power of the outstanding securities of the surviving entity; or (4) the

acquisition by any person (within the meaning of Section 13(d)(3) or Section

14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange

Act"), in a single transaction or series of related transactions, of

beneficial ownership (within the meaning of Rule 13d-3 or any successor rule or

regulation promulgated under the Exchange Act) of securities representing fifty

percent (50%) or more of the combined voting power of the then-outstanding

securities of the Company, excluding in any case shares of capital stock of the

Company purchased from the Company in a transaction the principal purpose of

which is to raise capital for the Company.

 

 

3.             GOLDEN PARACHUTE TAXES.  In the event that any payment or distribution

by the Company, or the grant of any benefit by the Company, to or for the

benefit of Employee (whether paid or payable, distributed or distributable or

granted or to be granted pursuant to the terms of this Agreement or otherwise)

(collectively, "Benefits") would be nondeductible by the Company for

federal income tax purposes because of Section 280G of the Internal Revenue

Code (the "Code") and/or would cause Employee to be liable for an

excise tax pursuant to Section 4999 of the Code, then the Benefits paid,

distributed or granted to Employee under this Agreement shall equal (i) the

full amount of such Benefits or (ii) the Reduced Amount (as defined below),

whichever of the foregoing amounts is determined by the Company to result, on

an after-tax basis, in the receipt by Employee of the greatest amount of such

Benefits, notwithstanding that all or some portion of the Benefits may be

taxable under Section 4999 of the Code. In making its determination pursuant to

the preceding sentence, the Company shall take into account all applicable

Federal, state, and local employment and income taxes, as well as the excise

tax imposed by Section 4999 of the Code. For purposes of this Section 4, the

"Reduced Amount" shall be the maximum amount payable to Employee that

would result in no portion of the Benefits being (i) nondeductible by the

Company under Section 280G of the Code or (ii) subject to an excise tax

liability under Section 4999 of the Code. Notwithstanding the foregoing and any

other provision contained herein, in the event (as a result of Benefits to be

received under this Agreement or any other plan or arrangement between the

Employee and the Company) of any required reduction, as a result of Section

4999 of the Code, of Benefits to be received by Employee, reduction shall be

made from such other plan or arrangement prior to any reduction relating to

Benefits to be received by Employee under this Agreement.

 

4.             GENERAL PROVISIONS.

 

                (a)           This Agreement shall be governed by

the laws of the State of California (without regard to principles of conflict

of laws).

 

                (b)           Any

notice, demand or request required or permitted to be given by either the

Company or Employee pursuant to the terms of this Agreement shall be in writing

and shall be deemed given when delivered personally or deposited in the U.S.

mail, First Class with postage prepaid, and addressed to the parties at such

addresses as have been previously furnished by the Parties or such other

address as a Party may request by notifying the other in writing.

 

                (c)           The rights and obligations of

Employee under this Agreement may not be transferred or assigned without the

prior written consent of the Company.

 

                (d)           This

Agreement is meant to supplement the terms of stock option agreement(s) or

other agreement(s) pursuant to which Employee acquired the Options, as well as

any written employment agreement between the Company and Employee. To the

extent that the terms and conditions of this Agreement are inconsistent with

those found in such stock option agreement(s) or other agreement(s) (employment

or otherwise), the terms and conditions of this Agreement shall be controlling.

 

 

                (e)           Any

Party's failure to enforce any provision or provisions of this Agreement shall

not in any way be construed as a waiver of any such provision or provisions,

nor prevent any Party from thereafter enforcing each and every other provision

of this Agreement. The rights granted the Parties herein are cumulative and

shall not constitute a waiver of any Party's right to assert all other legal

remedies available to it under the circumstances.

 

                (f)            Employee agrees upon request to

execute any further documents or instruments necessary or desirable to carry

out the purposes or intent of this Agreement.

 

                (g)           In

case any provision of this Agreement shall be invalid, illegal or

unenforceable, the validity, legality and enforceability of the remaining

provisions shall not in any way be affected or impaired.

 

                (h)           This Agreement, in whole or in part,

may be modified, waived or amended upon the written consent of the Company and

Employee.

 

                (i)            This Agreement may be executed in

one or more counterparts, each of which shall be deemed an original, but all of

which shall constitute one instrument.

 

 

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT

BLANK]

 

 

 

                IN WITNESS WHEREOF,

the undersigned have set their hand as of the date first above written.

 

 

	

  EMPLOYEE

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  DOT HILL SYSTEMS CORP.

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

  /s/Preston

  Romm

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  /s/James L.

  Lambert

  
	

  Preston Romm

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  By:    James L. Lambert

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  President

  and Chief Executive Officer

  

 

 

 

EXHIBIT A

 

RELEASE AND WAIVER OF CLAIMS

 

                In consideration of the payments and other

benefits set forth in the Change of Control Agreement dated August 23, 2001,

between Dot Hill Systems Corp. (the "Company") and Preston Romm

("Employee"), to which this form is attached, Employee hereby

furnishes the Company with the following release and waiver.

 

                Employee hereby releases, and forever

discharges the Company, its officers, directors, agents, employees, stockholders,

successors, assigns and affiliates, of and from any and all claims,

liabilities, demands, causes of action, costs, expenses, attorneys' fees,

damages, indemnities and obligations of every kind and nature, in law, equity,

or otherwise, known and unknown, suspected and unsuspected, disclosed and

undisclosed, arising at any time prior to and including Employee's employment

termination date with respect to any claims relating to Employee's employment

and the termination of Employee's employment, including but not limited to,

claims pursuant to any federal, state or local law relating to employment,

including, but not limited to, discrimination claims, claims under the

California Fair Employment and Housing Act, and the Federal Age Discrimination

in Employment Act of 1967, as amended ("ADEA"), the Federal Americans

with Disabilities Act ("AD") or claims for wrongful termination,

breach of the covenant of good faith, contract claims, tort claims, and wage or

benefit claims, including but not limited to, claims for salary, bonuses,

commissions, stock, stock options, vacation pay, fringe benefits, severance pay

or any form of compensation.

 

                Employee also acknowledges that Employee has

read and understood Section 1542 of the California Civil Code which reads as

follows: "A general release does not extend to claims which the creditor

does not know or suspect to exist in his favor at the time of executing the

release, which if known by him must have materially affected his settlement

with the debtor." Employee hereby expressly waives and relinquishes all

rights and benefits under that section and any law of any jurisdiction of

similar effect with respect to any claims Employee may have against the

Company.

 

                Employee acknowledges that, among other

rights, Employee is waiving and releasing any rights Employee may have under

ADEA, that this waiver and release is knowing and voluntary, and that the

consideration given for this waiver and release is in addition to anything of

value to which Employee was already entitled as an employee of the

Company.  Employee further acknowledges

that Employee has been advised, as required by the Older Workers Benefit

Protection Act, that:  (a) the waiver and

release granted herein does not relate to claims which may arise after this release

and waiver is executed; (b) Employee has the right to consult with an attorney

prior to executing this release and waiver (although Employee may choose

voluntarily not to do so); and (c) if on the date of execution of this release

and waiver Employee is age 40 or older, then (I) Employee has twenty-one (21)

days from the date Employee receives this release and waiver, in which to

consider this release and waiver (although Employee may choose voluntarily to

execute this release and waiver earlier); and (II) Employee has seven (7) days

following the execution of this release and waiver to revoke Employee's consent

to this release and waiver. This release and waiver shall be effective as of

the date of execution hereof; provided that if on the date of execution of this

release and waiver Employee is age 40 or older, then this release and waiver

shall not be effective until the foregoing seven (7) day revocation period has

expired. The date as of which this release and waiver is effective as aforesaid

shall be deemed the "Effective Date" hereof.

 

 

	

  Date:

  	

   

  	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

   

  	

  Preston Romm

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}]]