Document:

ntap-ex1057_210.htm

Exhibit 10.57

May 28, 2020 

 

Henri Richard 

 

Dear Henri: 

 

This letter confirms the agreement between NetApp, Inc. (“NetApp” or the “Company”) and you regarding the terms of your mutual separation from the Company (the “Agreement”). Your employment will end by mutual agreement on June 5, 2020 (your “Retirement Date”). Until your Retirement Date, you have agreed to assist with an orderly transition of your duties. 

 

	
1. 
	
Separation Benefits. In consideration for you signing and not revoking this Agreement, the representations you make in this Agreement, and your complying with its terms, you will receive a lump sum payment in the amount of $300,000, less applicable taxes, deductions and withholding and any amounts you owe to the Company. You agree that the foregoing shall constitute the entire amount of consideration provided to you under this Agreement, and that you will not seek any further compensation for any other claimed damage, costs or attorneys’ fees from NetApp at any time for any reason. 

 

	
2. 
	
Executive Compensation Plan. To the extent not paid as of the Retirement Date, you will be eligible to receive payment of the amount earned under your fiscal 2020 incentive compensation award, less applicable taxes, deductions and withholdings, in accordance with the terms and conditions approved by the Compensation Committee of the Company’s Board of Directors under the Company’s Executive Compensation Plan (the “ECP”). 

 

	
3. 
	
Stock Options, Restricted Stock Units (RSUs) and Performance-Based RSUs (PBRSUs). For purposes of clarification, you will receive vesting of that portion of your outstanding PBRSUs with a performance period ending on April 24, 2020, with payout based on actual performance of the Company relative to the metrics set forth in the award agreement governing such PBRSUs. The vesting of your outstanding PBRSUs with performance periods ending after April 24, 2020 will be governed by the terms of the applicable grant agreement, including with respect to its provisions regarding eligibility to vest on a pro-rata basis in connection with a Retirement (as such term is defined in the applicable grant agreement). The parties acknowledge and agree that your separation constitutes a Retirement for purposes of the applicable PBRSU grant agreement. Except as provided herein, your stock options, RSUs, and PBRSUs that are not eligible to vest in connection with your Retirement will stop vesting on your Retirement Date. 

 

Stock Administration will send a Closing Statement to your mailing address on file with NetApp. The Closing Statement will identify any stock options available for exercise and the deadline to exercise those options [and the portion of any PBRSUs that are eligible to vest due to your Retirement]. You must exercise any vested options that are exercisable by the “Last Date to Exercise” on the Closing Statement. If the Last Date to Exercise falls on a weekend or Holiday, you must complete your transaction on or before the business day immediately preceding the Last Date to Exercise. If you have any questions or do not receive the statement within two (2) weeks of your Retirement Date, it is your responsibility to contact NetApp Stock Administration at stockadmin@netapp.com or (408) 822-4034. Any stock options and RSUs as of your Retirement Date and PBRSUs that are not eligible to vest in connection with your Retirement (also as of the Retirement Date) will be cancelled. 

 

	
4. 
	
Continuation of Health Benefits. Your health benefits will continue until the last day of June 2020. After that date, you may elect to continue your health insurance coverage under COBRA, 

 

Exhibit 10.57

		
assuming you are eligible for COBRA continuation. NetApp does not determine your eligibility for COBRA. 

 

	
5. 
	
Return of Company Property. By the Retirement Date, you will return to the Company all Company documents (and all copies thereof) and other Company property and materials in your possession, or your control, including, but not limited to, Company files, notes, memoranda, correspondence, lists, drawings, records, plans and forecasts, financial information, personnel information, customer and customer prospect information, sales and marketing information, product development and pricing information, specifications, computer-recorded information, tangible property, credit cards, entry cards, identification badges and keys, and any material of any kind which contain or embody any proprietary or confidential material of the Company (and all reproductions thereof). You agree to return all Company electronic equipment with all Company files, including but not limited to Company email, intact. You further confirm that you have cancelled all accounts for your benefit, if any, in the Company’s name, including, but not limited to, credit cards, telephone charge cards, cellular phone and/or pager accounts and computer accounts. Separation Benefits will not be provided until all Company property is returned. By executing this Agreement, you are confirming in writing that you have returned all Company property as described in this paragraph. This paragraph is a material part of this Agreement. You acknowledge and understand that failure to comply with this paragraph constitutes a material breach of this Agreement. 

 

	
6. 
	
Maintaining Confidential Information. You agree not to disclose any confidential information you acquired while an employee of the Company to any other person or entity, or use such information in any manner that is detrimental to the Company’s interests, per NetApp’s Proprietary Information and Inventions Agreement or similar agreement (“PIIA”), which you signed when you were hired, and you further agree to honor the terms of the PIIA, including those terms which survive your employment with the Company. 

 

However, nothing in this Agreement prohibits you from reporting an event that you reasonably and in good faith believe is a violation of the law to the relevant law enforcement agency (such as the Securities and Exchange Commission, Equal Employment Opportunity Commission or Department of Labor), or from cooperating in an investigation conducted by such a government agency. You are hereby provided notice that under the 2016 Defend Trade Secrets Act, (1) no individual will be held criminally or civilly liable under Federal or State trade secret law for the disclosure of a trade secret (as defined in the Economic Espionage Act) that (A) is made in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and made solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal so that it is not made public; and (2) an individual who pursues a lawsuit for retaliation by an employer for reporting a suspected violation of the law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal, and does not disclose the trade secret, except as permitted by court order. This Agreement also does not prevent the disclosure of factual information relating to claims of sexual assault, sexual harassment, harassment or discrimination based on sex, or retaliation for filing a claim of sexual assault. 

 

You agree to keep confidential and not disclose any negotiations and discussions resulting in this Agreement; provided however, that you may discuss this matter in confidence with your spouse/domestic partner, attorney or accountant, so long as those parties agree to be bound by this confidentiality agreement. 

 

Exhibit 10.57

 

These paragraphs are a material part of this Agreement. You acknowledge and understand that failure to comply with these paragraphs, or any of them, constitute a material breach of this Agreement. 

 

	
7. 
	
Cooperation with the Company. You agree to cooperate fully with the Company in its defense or prosecution of or other participation in any administrative, judicial or other proceeding arising from any charge, complaint, action for protection of intellectual property, or other action which has been or may be filed, including, without limitation, including, but not limited to the currently pending claims captioned Smith v. NetApp, Inc., et al. Smith v. NetApp, Inc. et al., and Sorokunov v. NetApp, Inc. 

 

	
8. 
	
Non-Disparagement. You agree that, at all times, you shall not make any false, disparaging or derogatory statements to any media outlet, industry group, financial institution or current or former employee, consultant, client, customer of the Company or other person or entity regarding the Company, or any of its directors, officers, employees, agents, or representatives, or about the Company’s products, services, technologies, business affairs and/or financial condition. Nothing in this section prevents you from initiating or participating in any government investigation and testifying truthfully under oath pursuant to subpoena or other legal process. 

 

	
9. 
	
Non-Solicitation of Company Employees, Contractors or Consultants. You will not for a period of one year immediately after the end of your employment, directly or indirectly, individually or on behalf of any person or entity, solicit or induce or assist in any manner in the solicitation or inducement of any employee, contractor or consultant of the Company or any affiliate company, to: 

 

	
 
	
a. 
	
render services to you or for your benefit or for the benefit of another person or entity; and/or 

	
 
	
b. 
	
terminate his or her employment or engagement by the Company or affiliated company. 

 

As part of this restriction, subject to applicable laws, you will not provide any Proprietary Information (as defined in the PIIA) regarding an employee of the Company in connection with a third party considering that employee for employment. This restriction shall not apply to general and non-targeted communications that advertise employment opportunities. You understand that this restriction shall also not apply to communications with employees of the Company as part of your performance of duties for the Company (such as bona fide hiring and firing decisions affecting Company personnel). 

 

Where required by applicable law to be enforceable, the foregoing restrictions shall be limited to employees, contractors, and consultants with whom you had material business-related contact or dealings or as to whom you performed supervisory responsibilities or received Proprietary Information about in the last two years of employment with the Company (or such shorter period of time if you have been employed with the Company for less than two years). 

 

California Exception: If you reside in California and are subject to its laws, then you may not for a period of one year after your Retirement Date, either directly or indirectly solicit or attempt to solicit, as that term is defined pursuant to California law, any employee, independent contractor, or consultant of the Company to terminate his or her relationship with the Company in order to become an employee, consultant, independent contractor or re-seller to or for any other person or entity outside the Company. As part of this restriction, subject to California law, you 

 

Exhibit 10.57

will not provide any Proprietary Information regarding an employee of the Company in connection with a third party considering that employee for employment. This restriction shall not apply to general and non-targeted communications that advertise employment opportunities, unsolicited requests for employment or references so long as they do not disclose Proprietary Information, or communications with employees of the Company as part of the performance of duties for the Company (such as bona fide hiring and firing decisions affecting Company personnel). 

 

	
10. 
	
Acknowledgment of Payment of Wages. By your Retirement Date, you will have received your final paycheck which will include a final payment for wages through your Retirement Date, bonuses (if any), employee stock purchase plan reimbursement, accrued but unused vacation pay and any similar payments due from NetApp, less applicable taxes, deductions and withholdings, if applicable, as of the Retirement Date. You acknowledge that NetApp does not owe you any other amounts, except any payment under the NetApp ECP in accordance with paragraph 2 herein, payment of any PBRSUs in accordance with paragraph 3 herein, and any valid unreimbursed business expenses that you will submit to the Company. ECP payment will be made at the time as all such payments under the plan. Requests for reimbursement of business expenses must be made within 21 days from your Retirement Date. By signing this Agreement, you also expressly agree that the Company may deduct from your separation payment check any amounts owed to the Company as of your Retirement Date, including but not limited to repayment of expenses, vacation and other benefits advanced to you by the Company. 

 

	
11. 
	
General Release. You understand that by signing this Agreement, you are agreeing not to sue, or otherwise file any claim against, the Company or any of its employees or other agents for any reason whatsoever based on anything that has occurred as of the date you sign this Agreement.

 

	
 
	
a. 
	
On behalf of yourself and your heirs and assigns, you hereby generally release and forever discharge the “Releasees” hereunder, consisting of the Company, and each of its owners, shareholders, affiliates, divisions, predecessors, successors, assigns, agents, directors, officers, partners, employees, attorneys and insurers, and all persons acting by, through, under or in concert with them, or any of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, loss, cost or expense, of any nature whatsoever, known or unknown, fixed or contingent (hereinafter called “Claims”), which you now have or may hereafter have against the Releasees, or any of them, by reason of any matter, cause or thing whatsoever from the beginning of time to the date hereof, including, without limiting the generality of the foregoing, any Claims arising out of, based upon, or relating to your hire, employment, remuneration or resignation by the Releasees, or any of them, including any Claims arising under Title VII of the Civil Rights Act of 1964, as amended; the Equal Pay Act, as amended; the Fair Labor Standards Act, as amended; the Employee Retirement Income Security Act, as amended; the California Fair Employment and Housing Act, as amended; the California Labor Code; and/or any other waiveable local, state or federal law governing discrimination in employment, the payment of wages and employment benefits, and all claims for attorneys’ fees costs and expenses. 

 

Notwithstanding the generality of the foregoing, you do NOT release the following claims:

 

	
 
	
i. 
	
Claims for unemployment compensation or any state disability insurance benefits pursuant to the terms of applicable state law

 

Exhibit 10.57

	
 
	
ii. 
	
Claims for workers’ compensation insurance benefits under the terms of any workers’ compensation insurance policy or fund of the Company, though you acknowledge that you did not suffer any workplace or work-related injury during the term of your employment that you have not already reported to the Company; 

	
 
	
iii. 
	
Claims to continued participation in certain of the Company’s group benefit plans pursuant to the terms and conditions of the federal law known as COBRA; 

	
 
	
iv. 
	
Claims to any benefit entitlements vested as of the date of your employment termination, pursuant to written terms of any Company employee benefit plan; 

v. Claims for statutory indemnity; 

	
 
	
vi. 
	
The right to file a charge with or report a claim or concern to the National Labor Relations Board, Equal Employment Opportunity Commission, Securities and Exchange Commission, the Occupational Safety and Health Administration and other similar government agencies. However, you agree that with respect to any non-waiveable Claims brought before any government agency, you waive your right (if any) to any monetary or other recovery should any government agency or other third party pursue any claims on your behalf, either individually, or as part of any collective action; 

vii. Claims to enforce this Agreement; 

	
 
	
viii. 
	
The right to testify in an administrative, legislative, or judicial proceeding concerning alleged criminal conduct or alleged sexual harassment on the part of the Company or its agents or employees, if you have been required or requested to attend the proceeding pursuant to a court order, subpoena, or written request from an administrative agency or the legislature; and 

ix. Claims that may not be released, waived or compromised by private agreement. 

 

	
 
	
b. 
	
YOU ACKNOWLEDGE THAT YOU ARE FAMILIAR WITH THE PROVISION OF CALIFORNIA CIVIL CODE SECTION 1542, OR COMPARABLE APPLICABLE STATE STATUTE, WHICH PROVIDES AS FOLLOWS: 

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY. 

 

BEING AWARE OF SAID CODE SECTION, YOU HEREBY EXPRESSLY WAIVE ANY RIGHTS YOU MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT. 

 

	
 
	
c. 
	
In accordance with the Older Workers Benefit Protection Act of 1990, you should be aware of the following: 

 

	
 
	
i.
	
You have the right to consult with an attorney and are hereby advised in writing to consult with an attorney of your choice prior to signing this Agreement; 

	
 
	
ii.
	
You are, through this Agreement, releasing the Releasees from any and all claims you may have against them, including but not limited to claims for age discrimination under the Age Discrimination in Employment Act of 1967 (29 U.S.C. § 621, et seq.); 

 

Exhibit 10.57

	
 
	
iii.
	
You understand that rights or claims under the Age Discrimination in Employment Act of 1967 (29 U.S.C. § 621, et seq.), that may arise after the date this Agreement is signed, are not waived; 

	
 
	
iv.
	
You have the opportunity of a full twenty-one (21) days from the date of this Agreement, or the day you were presented with this Agreement, whichever is later, to consider this Agreement before signing it, and if you have not availed yourself of that full time period, you have failed to do so knowingly and voluntarily; and 

	
 
	
v.
	
You have seven (7) days after signing this Agreement to communicate in writing any revocation of this Agreement to the Sr. Vice President of Human Resources of the Company, for receipt within seven (7) days of acceptance, and this Agreement will not be effective, and you will not receive any of the Separation Benefits, until that revocation period has expired. 

 

	
12. 
	
Severability. The provisions of this Agreement are severable. If any provision is held to be invalid or unenforceable, it shall not affect the validity or enforceability of any other provision. 

 

	
13. 
	
Choice of Law/Venue. The Parties agree that all controversies arising out of this Agreement will be governed by the law of the state in which you were last employed by the Company. The prevailing party in any such action shall be entitled to recover costs and attorneys’ fees. 

 

	
14. 
	
Voluntary and Knowing Agreement. You represent that you have thoroughly read and considered all aspects of this Agreement, that you understand all of its provisions, and that you are voluntarily entering into said Agreement. 

 

	
15. 
	
Attorneys’ Fees and Costs. You and the Company each agree to bear your own attorneys’ fees and costs and expenses incurred, and to be incurred, in connection with any Claim and the negotiation, execution and implementation of this Agreement. 

 

	
16. 
	
Arbitration of Disputes. Any controversy, dispute, or claim between the Parties to this Agreement, including any claim arising out of, in connection with, or in relation to the formation, interpretation, performance or breach of this Agreement; as well as all disputes arising out of or relating to the employment relationship including, but not limited to, claims arising under statute, regulation, contract or common law, shall be resolved exclusively by arbitration, before a single arbitrator, in accordance with the Employment Arbitration Rules and Mediation Procedures of the American Arbitration Association (“AAA”) then in effect, and not by a court or jury trial. AAA rules may be found at www.adr.org or by using an internet search engine (such as google.com or bing.com). If you, for any reason, want the Company to provide you with a copy of these rules, the request should be made within thirty (30) days of the execution of this Agreement. The arbitration shall be held within 45 miles of where you were last employed by the Company. Arbitration under this Agreement is governed by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.) and evidences a transaction involving commerce. 

 

	
 
	
a. 
	
This Agreement does not prevent you from filing a complaint or charge with the Equal Employment Opportunity Commission or National Labor Relations Board, and it does not apply to claims for workers’ compensation or unemployment insurance benefits. 

	
 
	
b. 
	
The arbitrator will be selected by mutual agreement of the Parties or, if the Parties cannot agree, by alternatively striking names from a list of arbitrators supplied by the AAA in accordance with the AAA’s rules. Each party will pay his/her/its own attorneys’ fees, subject to any remedies a party may be entitled to under applicable law. However, in accordance with applicable law, the Company will pay the arbitrator’s and arbitration 

 

Exhibit 10.57

	
 
		
fees. The award of the arbitrator shall be set forth in writing and shall be final and binding. Judgment upon any award may be entered in any court having jurisdiction. 

	
 
	
c. 
	
Without waiving any other rights and remedies under this Paragraph, either you or the Company may apply for provisional equitable relief from a court of competent jurisdiction when an arbitration award may be ineffectual without such provisional relief. Nothing in this Paragraph shall preclude or excuse a party from bringing an administrative claim before any agency in order to fulfill the party’s obligation to exhaust administrative remedies before making a claim in arbitration. 

	
 
	
d. 
	
Before submission of the written claim for arbitration, the Parties shall submit the matter to non-binding mediation before a mutually selected neutral mediator. The Company shall pay the reasonable fees of the mediator and the expenses associated with the mediation. JAMS, Judicate West, or some comparable independent mediation service shall be used to provide the mediator and the rules under which the mediation shall be conducted. In the event the claim is not resolved through the mediation process, the claim shall be submitted to binding arbitration, as provided herein. 

 

	
17. 
	
Entire Agreement; Amendment. This Agreement sets forth the entire Agreement between you and the Company and supersedes any and all prior oral and written agreements or understandings between you and the Company concerning the subject matter, including, but not limited to, the Change of Control Severance Agreement entered into between you and the Company dated June 23, 2019, except the PIIA which you signed at the start of your employment which shall remain in full force and effect. This Agreement may not be altered, amended or modified, except by a further written document signed by you and the Company. 

 

You will be provided the opportunity to sign this document electronically if you so choose. Alternately you may date and sign a hard copy of this document in the places indicated below and return it to: 

 

NetApp 

7301 Kit Creek Rd 

P.O. Box 13917 

Research Triangle Park, NC 27709 

Attn: HR – People Operations 

 

Your deadline to sign this Agreement is 21 days from the Retirement Date. 

 

Respectfully, 

 

s/ Debra McCowan

Debra McCowan

Sr. VP, Human Resources

 

Accepted and agreed to on May 28, 2020

 

		
	
Signed by
	
/s/ Henri Richard

	
 
	
Henri Richardntap-ex1058_211.htm

Exhibit 10.58

March 19, 2020 

 

César Cernuda 

 

Dear César: 

 

We are pleased to offer you the position of President with NetApp, Inc. (“NetApp” or the "Company"). In this exempt position, you will report to George Kurian, our Chief Executive Officer (CEO) and the date you commence employment at NetApp (your “Start Date”) shall be no later than July 1, 2020. Your formal appointment as President by the Board of Directors will follow the acceptance of this offer and will be publicly announced at a mutually agreeable date. 

 

CASH COMPONENTS 

 

Base Compensation 

Your annual base salary will be $800,000, less applicable tax withholdings and deductions. 

 

Incentive Compensation 

In addition to your base compensation, following the date you commence employment at NetApp (your “Start Date”), you will be eligible to earn an annual cash incentive compensation payout in accordance with the Executive Compensation Plan, as amended from time to time (the “Plan”). For your position, the annual target incentive compensation payout is 130% of your eligible earnings for the applicable fiscal year as defined in the Plan, beginning in NetApp’s fiscal year 2021 (FY21). Target incentives do not constitute a promise of payment. Your actual annual payout may be higher or lower than the target based on the overall Company performance and your individual performance and is subject to, and governed by, the Plan and the terms and conditions approved by the Compensation Committee (the “Compensation Committee”) of our Board of Directors (the “Board”). 

 

Sign-on Bonus 

You will also receive a $1,000,000 sign-on bonus (less applicable tax withholdings and deductions), payable within 30 days of your Start Date. You understand and agree that this bonus is an advance payment given to you in consideration for your commitment to remain employed by NetApp following your Start Date. Therefore, you also understand and agree that if you voluntarily terminate your employment with NetApp you will be required to reimburse NetApp certain amounts based on your date of voluntary termination. Specifically you understand and agree that if you voluntarily terminate your employment with NetApp: a) prior to or on the six month anniversary of the Start Date, you will be required to reimburse 100% of the dollar value of all compensation, including equity compensation (which dollar value shall be based on the thirty (30) day trailing average stock price as of the date of termination), paid to you by NetApp since your Start Date, excluding your base salary; b) on or after six (6) months from your Start Date and until the twelve (12) month anniversary of your Start Date, you will be required to reimburse NetApp $2,000,000; and (c) after twelve (12) months but prior to twenty-four (24) months from your Start Date, you will be required to reimburse NetApp $1,000,000. You agree to reimburse NetApp by December 31 of the calendar year of your voluntary termination. 

 

EQUITY COMPONENTS 

 

Initial Equity 

Following the commencement of your employment, you will receive a grant of service-based restricted stock units (Initial RSUs) with a dollar value of $2,500,000. The dollar value this grant will be converted to shares based on the 30-day trailing stock price average on or about the applicable grant date which shall be on or about the 15th of the month following your Start Date. You will be informed of the exact 

 

Exhibit 10.58

number of shares to which you are entitled within 3 business days of the grant date. The vesting commencement date of this grant will be on or about the 15th of the month following the month of your Start Date. Eighty percent (80%) of the Sign-on RSUs shall vest on December 31, 2020, and the remaining twenty percent (20%) shall vest on the one year anniversary of the vesting commencement date, subject to continued employment with the Company through the applicable vesting dates. 

 

New Hire Equity 

In addition, you will receive a grant of service-based restricted stock (New Hire RSUs) with a dollar value of $3,000,000. The dollar value of this grant will be converted to shares based on the 30-day trailing stock price average on or about the applicable grant date which shall be on or about the 15th of the month following your Start Date. You will be informed of the exact number of shares to which you are entitled within 3 business days of the grant date. The vesting commencement date of this grant will be on or about the 15th of the month following the month of your Start Date. The New Hire RSUs will vest at the rate of 50% on the first anniversary of the vesting commencement date, and 50% on the second anniversary of the vesting commencement date, subject to continued employment with the Company through the applicable vesting dates. 

 

Long Term Incentive Equity 

You will also receive a long-term equity grant with an aggregate dollar value of $6,500,000. The dollar value of this grant will be converted to shares based on the 30-day trailing stock price average on or about the applicable grant date which shall be on or about the 15th of the month following your Start Date. You will be informed of the exact number of shares to which you are entitled within 3 business days of the grant date. Sixty percent (60%) of this equity grant, or $3,900,000, will be in the form of Performance-Based Restricted Stock Units (PBRSUs) that will be eligible to vest at the end of the three (3) year performance period, or the end of Fiscal Year 2023, in accordance with the terms and performance conditions approved by the Compensation Committee. Forty percent (40%), or $2,600,000, will be in the form of service-based restricted stock units (RSUs) that will vest at the rate of 50% on the first anniversary of the vesting commencement date, and 50% on the second anniversary of the vesting commencement date, subject to continued employment with the Company through the applicable vesting dates. The vesting commencement date of this grant will be on or about the 15th of the month following the month of your Start Date. 

 

Sales Performance Equity

In your position as President, you will also be entitled to a unique equity grant in the form of Sales Performance-Based Restricted Stock Units (SPBRSUs) with an aggregate dollar value of $3,000,000. The dollar value of this grant will be converted to shares based on the 30-day trailing stock price average on or about the applicable grant date which shall be on or about the 15th of the month following your Start Date. You will be informed of the exact number of shares to which you are entitled within 3 business days of the grant date. Fifty percent (50%) of the SPBRSUs will be eligible to vest on the date the Compensation Committee certifies that the Company achieved not less than 97% of the Fiscal Year 2021 (FY21) Annual Bookings Plan approved by the Board, and the remaining 50% shall be eligible to vest on the date the Compensation Committee certifies that the Company achieved not less than 100% of the Fiscal Year 2022 (FY22) Annual Bookings Plan approved by the Board. 

 

Each equity grant described in this letter shall be subject to the terms and conditions of the Company’s 1999 Stock Plan and the terms and conditions of the applicable equity grant agreement. 

 

TARGET EARNINGS 

 

Your total target earnings for FY22 will be benchmarked against our peer group for executive compensation and will be based upon the Company’s performance and your individual performance and 

 

Exhibit 10.58

shall be subject to the review and approval of the Compensation Committee. Based on current market data, it is anticipated that the total target value of your equity grant for FY22, including service-based and performance-based equity, will be approximately $7,000,000. 

 

SEVERANCE BENEFITS 

 

Severance Entitlement 

The Compensation Committee has also approved a special severance package for you should you accept employment at NetApp. In the event you are terminated from the Company for any reason other than for Cause (as defined below), and the Change of Control Severance Agreement has not been triggered, subject to your execution of a release in favor of the Company, you will be entitled to eighteen (18) months of your base salary and target incentive bonus in effect on the date of your termination. For purposes of this section, “Cause” shall mean (a) your continued intentional and demonstrable failure to perform your duties customarily associated with your position as an employee of the Company (other than any such failure resulting from your mental or physical disability) after you have received a written demand of performance from the Company which specifically sets forth the factual basis for the Company’s belief that you have not devoted sufficient time and effort to the performance of your duties and have failed to cure such non-performance within thirty (30) days after receiving such notice (it being understood that if you are in good-faith performing your duties, not achieving results the Company deems satisfactory for your position, it will not be considered to be grounds for your termination for “Cause”); (b) your conviction of, or plea of nolo contendere to, a felony that the Board reasonably believes has had or will have a material detrimental effect on the Company’s reputation or business; or (c) your commission of an act of fraud, embezzlement, misappropriation, willful misconduct or violation of policy, or breach of fiduciary duty against, the Company. 

 

Change of Control Severance Agreement 

You are also eligible to enter into a Change of Control Severance Agreement entitling you to certain benefits in the event of your termination following a change of control of the Company. This benefit is exclusive of, and not coincident with, the Severance Entitlement referenced above. The form of agreement can be found at filed with the SEC at https://www.sec.gov/Archives/edgar/data/1002047/000156459019020164/ntap-ex101_40.htm. 

 

HEALTH AND WELFARE BENEFITS 

 

Executive Physical Benefit 

Our medical insurance plan with Anthem includes an Executive Physical Benefit—once per calendar year, payable at 100% up to a maximum of $2,500 whether an in-network or out-of-network physician is used. You will receive additional details regarding this benefit from the HR Benefits Team. 

 

Vacation

As President, you will not accrue any annual vacation. You are permitted to take vacation at your convenience in any number of days you require, provided that the vacation day(s) does not unreasonably interfere with the performance of your job. 

 

Generally Available Benefits 

As an employee of the Company, you are eligible for NetApp benefits, including medical, dental and life insurance, as of your hire date. The Company reserves the right to modify, amend or terminate any employee benefits at any time for any reason. During the course of your employment with NetApp, your employment benefits will be administered in compliance with applicable employment and labor laws. 

 

 

Exhibit 10.58

Non-Qualified Deferred Compensation Plan 

Thirty (30) days after you are hired, you are eligible for enrollment in the NetApp Non-Qualified Deferred Compensation Plan. The objective of the Non-Qualified Deferred Compensation Plan is to provide you with an opportunity to defer income (annual base and/or incentive compensation) on a pre-tax basis. You will receive additional details on this Plan from the HR Benefits Team within 30 days of your hire date. 

This offer is binding on NetApp and you and can be terminated by NetApp only under the following conditions: 1) items 1 a 5 of paragraph 5 of the General Terms and Conditions (below) are not met; 2) you have legal obligations to a third party that you have not disclosed to us that prevent you from performing the full duties of the position being offered to you; or 3) prior to your Start Date, (A) you engage in personal or professional conduct that would cause reputational harm to NetApp if NetApp were to become your employer or B) you become physically or mentally incapable of performing the duties of the position being offered to you. 

 

GENERAL TERMS AND CONDITIONS 

 

During your period of employment with the Company, NetApp will provide a corporate sponsored housing located within fifteen (15) miles of NetApp’s Corporate Headquarters. NetApp will also be responsible for payment of all your NetApp business related travel including travel from your ordinary place of residence to be booked through NetApp’s corporate travel service in accordance with NetApp policies and procedures. 

 

As an employee of NetApp, you are required to sign and agree to the Code of Conduct which includes the Company’s Insider Trading Policy. You are considered an “Insider” under that policy and as a result, you are required to abide by all obligations under that policy including, but not limited to, the restrictions on trading set forth in the policy. 

 

As a technology leader, NetApp develops and works with sensitive technologies controlled under various United States export laws and associated federal regulations. You confirm that you are not a citizen or permanent resident of Cuba, Iran, North Korea, Sudan or Syria. You agree that you will comply with all U.S. and other countries’ export control laws, applicable export control licensing requirements, and NetApp’s export compliance policies and procedures. Unless otherwise authorized by the U.S. Government and NetApp, you will not export or re-export directly or indirectly export-controlled technology, software, information, and hardware to any country prohibited under the U.S. export control laws, including Cuba, Iran, North Korea, Sudan and Syria.

 

We will work with you to obtain appropriate documentation to authorize you to work in the United States. Within three (3) days of your Start Date you will provide the Company with a completed Form I-9 (U.S. Employment Verification Eligibility), which you will receive on your Start Date, and the legally-required proof of your identity and authorization to work only in the United States. 

 

This offer of employment is contingent upon your satisfactorily completing, agreeing to, signing, and otherwise fulfilling the following NetApp documents and associated clearance processes (as determined in NetApp’s sole discretion). 

 

	
 
	
1.
	
NetApp Code of Conduct & Conflicts of Interest Certification 

	
 
	
2.
	
NetApp Insider Trading Policy & Consent 

	
 
	
3.
	
NetApp Proprietary Information & Inventions Agreement and Disclosure 

	
 
	
4.
	
NetApp Deemed Export Disclosure Form 

	
 
	
5.
	
Director and Officer Questionnaire 

 

 

Exhibit 10.58

We are of the understanding that: (i) you have already disclosed to us any potential legal obligations (by contract with a prior employer or otherwise) that might prevent or prohibit you from performing the duties of the position that you are being offered, (ii) you have had the opportunity to seek legal advice if it was necessary to address or evaluate your obligations in this regard, (iii) that you can represent to the Company that you are under no legal obligations that would prohibit you from performing the duties of the position being offered to you, and that (iv) you will not, in the performance of your duties to the Company, breach any non-disclosure, proprietary rights, non-competition, (other than potential legal obligations previously or simultaneously disclosed in accordance to item (i) in this paragraph) non-solicitation or other covenant in favor of any third party. 

 

The Company does not want you to bring with you any confidential or proprietary material of any former employee or to violate any other obligation to your former employers. 

 

Employment with NetApp is for no specific period of time. Notwithstanding anything set forth in this letter, either NetApp or you are free to terminate the employment relationship at any time for any reason, with or without notice or cause. This is the full and complete agreement between NetApp and you on this term. Although your job duties, title, compensation and benefits, as well as the Company's policies and procedures, may change from time-to-time, the "at-will" nature of your employment and your residence or office location may only be changed in an express writing signed by the CEO of the Company and you. 

 

This letter sets forth the terms of your employment with NetApp and supersedes any prior representations or agreements, whether written or oral. This offer will expire at midnight Pacific Time on Monday March 23rd. Please electronically sign the offer letter on or prior to the expiration date of this offer. 

We look forward to having you join us. Shortly you will receive a “Welcome” email with login instructions asking you to log in to the NetApp Pre-Boarding tool. The tool provides a preview of NetApp’s values and culture and contains important forms that you must complete before your start date. Please log on to www.netapp.com before your start date to catch up on news, press releases and other information related to the Company. If you have any questions, please call me with any questions at 408.822.3226. 

 

You have the opportunity to make a significant mark in the technology industry by leading the successful transformation of an important institution, its culture, capabilities, position in the market, strategy and results. We believe that NetApp’s position as a steward of customers’ most important digital asset, data, and the differentiated position we already have in the hybrid cloud can be the source of enormous value creation. And we believe that as you reflect on your career in future years, you will remember this opportunity as the one where you had the most impact, learned the most and had the most fun. 

 

Sincerely,

 

		
	
/s/ Debra C. McCowan

Debra C. McCowan 

Chief Human Resources Officer 

NetApp, Inc. 
	
 

 

I have read, agree to and accept this employment offer and all terms set forth therein: 

 

		
	
/s/ César Cernuda

César Cernuda

 
	
March 23, 2020

Date

 

My Start Date will be: No later than July 1st 2020

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