Document:

exv10w2

 

Exhibit 10.2

EXECUTIVE CHANGE IN CONTROL SEVERANCE AGREEMENT

     This Executive Change in Control Severance Agreement (this “Agreement”), is made as of June
30, 2005, by and between Advanced Energy Industries, Inc., a Delaware corporation (the “Company”),
and Hans-Georg Betz (the “Executive”), and shall become effective as of the day the Executive
commences his employment with the Company (the “Effective Date”) as its President and Chief
Executive Officer.

Recitals

     A. It is anticipated that the Executive shall commence service as President and Chief
Executive Officer of the Company in the Office of the President on August 1, 2005.

     B. The Board of Directors of the Company (the “Board”) acknowledges that consolidation within
the industries in which the Company operates is likely to continue and the potential for a change
in control of the Company, whether friendly or hostile, currently exists and from time to time in
the future will exist, which potential can give rise to uncertainty among the senior executives of
the Company. The Board considers it essential to the best interests of the Company to reduce the
risk of the Executive’s departure and/or the inevitable distraction of the Executive’s attention
from his duties to the Company, which are normally attendant to such uncertainties.

     C. The Executive confirms that the terms of this Agreement reduce the risks of his departure
and distraction of his attention from his duties to the Company and, accordingly, desires to enter
into this Agreement.

Agreement

     In consideration of the foregoing and the mutual covenants contained herein, the Company and
the Executive agree as follows:

     1. Definitions. Capitalized terms used herein shall have the meanings given to them
in Annex A attached hereto, except where the context requires otherwise.

     2. Term of Agreement.

         (a) This Agreement shall be effective as of the Effective Date and shall continue in effect
until the second anniversary of the Effective Date, provided, however, that the term of this
Agreement automatically shall be extended for one additional year effective as of each anniversary
of the Effective Date beginning with the second anniversary, unless either the Company or the
Executive provides written notice to the other that the term of this Agreement shall terminate on
the upcoming anniversary of the Effective Date, provided such notice is received by the receiving
party not less than ninety (90) days prior to the intended date of termination and provided further
that the Company shall not be entitled to deliver to the Executive such notice in the event of a
Change in Control or a Pending Change in Control. Notwithstanding the foregoing, this Agreement
shall terminate immediately upon (a) the Executive’s Voluntary Resignation, (b) the termination of
the Executive’s employment for Cause, or (c) the termination of the CIC Period.

 

 

         (b) “Voluntary Resignation” means the termination of the Executive’s employment upon his
voluntary resignation, which includes retirement.

         (c) “CIC Period” means the 30-day period commencing on the date that is six months following
the effective date of a Change in Control and ending on the date that is thirty (30) days
thereafter.

     3. At Will Employment; Reasons for Termination.

         (a) The Executive’s employment shall continue to be at-will, as defined under applicable law.
If the Executive’s employment terminates for any reason or no reason, the Executive shall not be
entitled to any compensation, benefits, damages, awards or other payments in respect of such
termination, except as provided in this Agreement or pursuant to the terms of any Applicable
Benefit Plan. “Applicable Benefit Plan” means any written employee benefit plan in effect and in
which the Executive participates as of the time of the termination of his employment.

         (b) The Executive’s employment shall be terminated upon the first to occur of the following:

               (i) the Executive’s Voluntary Resignation;

               (ii) termination by the Company for Cause;

               (iii) the Executive’s death or Long-Term Disability;

               (iv) termination by the Company without Cause;

               (v) termination by the Executive for Good Reason following a Change in Control; and

               (vi) termination by the Executive during the CIC Period.

         (c) The Executive’s termination shall be deemed to be an “Involuntary Termination,” if such
termination is effected (i) by the Company without Cause following a Change in Control or during a
Pending Change in Control, (ii) by the Executive for Good Reason following a Change in Control, or
(iii) by the Executive during the CIC Period.

         (d) “Cause” means any of the following:

               (i) the Executive’s (A) conviction of a felony; (B) commission of any other material act or
omission involving dishonesty or fraud with respect to the Company or any of its Affiliates or any
of the customers, vendors or suppliers of the Company or its Affiliates; (C) misappropriation of
material funds or assets of the Company for personal use; or (D) engagement in unlawful harassment
or unlawful discrimination with respect to any employee of the Company or any of its subsidiaries;

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               (ii) the Executive’s continued substantial and repeated neglect of his duties, after written
notice thereof from the Board, and such neglect has not been cured within 30 days after the
Executive receives notice thereof from the Board;

               (iii) the Executive’s gross negligence or willful misconduct in the performance of his duties
hereunder that is materially and demonstrably injurious to the Company; or

               (iv) the Executive’s engaging in conduct constituting a breach of his written obligations to
the Company in respect of confidentiality and/or the use or ownership of proprietary information.

         (e) “Good Reason” means any of the following:

               (i) a material reduction in the Executive’s duties, level of responsibility or authority,
other than (A) reductions solely attributable to the Company ceasing to be a publicly held company
or becoming a subsidiary or division of another company, or (B) isolated incidents that are
promptly remedied by the Company; or

               (ii) a reduction in the Executive’s Base Salary, without (A) the Executive’s express written
consent or (B) an increase in the Executive’s benefits, perquisites and/or guaranteed bonus, which
increase(s) have a value reasonably equivalent to the reduction in Base Salary; or

               (iii) a reduction in the Executive’s Target Bonus, without (A) the Executive’s express written
consent or (B) a corresponding increase in the Executive’s Base Salary; or

               (iv) a material reduction in the Benefits, taken as a whole, without the Executive’s express
written consent; or

               (v) the relocation of the Executive’s principal place of business to a location more than
thirty-five (35) miles from the Executive’s principal place of business immediately prior to the
Change in Control, without the Executive’s express written consent; or

               (vi) the Company’s (or its successor’s) material breach of this Agreement.

     4. Severance Benefits.

         (a) Compensation and Benefits Required by Law or Applicable Benefit Plan.
Notwithstanding anything to the contrary herein, the Executive or his estate shall be entitled to
any and all compensation, benefits, awards and other payments required by any Applicable Benefit
Plan, the COBRA Act or other applicable law, after taking into account the agreements set forth
herein.

         (b) No Payments Without Release. The Executive shall not be entitled to any of the
compensation, benefits or other payments provided herein in respect of the termination of his
employment, unless and until he has provided to the Company a full release of

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claims, substantially in the form of Appendix I attached hereto, which release shall
be dated not earlier than the date of the termination of his employment and shall release the
Company of any claims that the Executive may have in respect of his employment with the Company or
the termination thereof.

         (c) Voluntary Resignation or Termination for Cause.

               (i) In the event of the Executive’s Voluntary Resignation or termination of his employment by
the Company for Cause, the Executive shall not be entitled to any compensation, benefits, awards or
other payments in connection with such termination of his employment, except as provided in
paragraph (a) of this Section 4.

               (ii) The Executive shall not be deemed to have been terminated for Cause under this Agreement,
unless the following procedures have been observed: To terminate the Executive for Cause, the
Board must deliver to the Executive notice of such termination in writing, which notice must
specify the facts purportedly constituting Cause in reasonable detail. The Executive will have the
right, within 10 calendar days of receipt of such notice, to submit a written request for review by
the Board. If such request is timely made, within a reasonable time thereafter, the Board (with
all directors attending in person or by telephone) shall give the Executive the opportunity to be
heard (personally or by counsel). Following such hearing, unless a majority of the directors then
in office confirm that the Executive’s termination was for Cause, the Executive’s termination shall
be deemed to have been made by the Company without Cause for purposes of this Agreement.

         (d) Death or Long-Term Disability. In the event of the Executive’s death or Long-Term
Disability, the Executive (or his estate or personal representative) shall be entitled to receive
(i) the proceeds of any life insurance policy carried by the Company with respect to the Executive,
(ii) payments pursuant to any long-term disability insurance policy carried by the Company with
respect to the Executive, and (iii) within sixty (60) days following the Executive’s death or
Long-Term Disability, a lump-sum payment equal to six months’ salary, reduced by any proceeds or
payments remitted or to be remitted pursuant to clause (i) or (ii) above.

         (e) Termination by the Company without Cause and without a Change in Control. In the
event of the Executive’s termination without Cause, provided that a Change in Control has not
occurred and there is no Pending Change in Control, the Executive shall be entitled to receive:

               (i) within fifteen (15) calendar days after the Date of Termination, the Executive’s Accrued
Compensation and Pro-Rata Bonus through the date of termination; and

               (ii) within fifteen (15) calendar days after the Date of Termination, the amount in cash equal
to product of (A) 1.5 and (B) the sum of the Executive’s annual Base Salary and the Executive’s
Target Bonus in effect as of the Date of Termination; and

               (iii) for eighteen (18) months after the Date of Termination, or such longer period as may be
provided by the terms of any Applicable Benefit Plan, continuation

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of the benefits for the Executive and/or the Executive’s family that are being provided to the
Executive and/or the Executive’s family immediately prior to the Date of Termination, including the
welfare benefit plans, practices, policies and programs provided by the Company (including, without
limitation, medical, prescription, dental, disability, employee life, group life, accidental death
and travel accident insurance plans and programs) (collectively, the “Benefits”), as if the
Executive’s employment had not been terminated; provided, however, that if the Executive commences
employment with another employer during such eighteen (18) month period and is eligible to receive
medical or other welfare benefits under the new employer’s plan(s), the Benefits shall terminate as
of the date the Executive becomes eligible to receive such benefits; and

         (iv) an amount equal to the contributions to the Company’s retirement plans on behalf of the
Executive that would have been made for the benefit of the Executive if the Executive’s employment
had continued for eighteen (18) months after the Date of Termination, assuming for this purpose
that all benefits under any such retirement plans were fully vested and that the Executive’s
compensation during such eighteen (18) months were the same as it had been immediately prior to the
Date of Termination; and

         (v) reimbursement, up to $15,000, for outplacement services reasonably selected by the
Executive.

         (f) Involuntary Termination. In the event Executive’s employment is terminated under
circumstances constituting an Involuntary Termination, the Executive shall be entitled to receive:

               (i) within 15 calendar days after the Date of Termination, the Executive’s Accrued
Compensation and Pro-Rata Bonus through the Date of Termination; and

               (ii) within fifteen (15) calendar days after the Date of Termination, the amount in cash equal
to the product of (A) 2.625 and (B) the sum of the Executive’s annual Base Salary and the
Executive’s Target Bonus in effect as of the Date of Termination; and

               (iii) for twenty-seven (27) months after the Date of Termination, or such longer period as may
be provided by the terms of any Applicable Benefit Plan, continuation of the Benefits, as if the
Executive’s employment had not been terminated; provided, however, that if the Executive commences
employment with another employer during such twenty-seven (27) month period and is eligible to
receive medical or other welfare benefits under the new employer’s plan(s), the Benefits shall
terminate as of the date the Executive becomes eligible to receive such benefits;

               (iv) an amount equal to the contributions to the Company’s retirement plans on behalf of the
Executive that would have been made for the benefit of the Executive if the Executive’s employment
had continued for twenty-seven (27) months after the Date of Termination, assuming for this purpose
that all benefits under any such retirement plans were fully vested and that the Executive’s
compensation during such twenty-seven (27) months were the same as it had been immediately prior to
the Date of Termination; and

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               (v) reimbursement, up to $15,000, for outplacement services reasonably selected by the
Executive; provided that the Executive may not terminate his employment for Good Reason, unless he
has delivered prior written notice of his belief that Good Reason exists and the Company has not
fully remedied the situation (such that Good Reason no longer exists) within ten (10) business days
after receipt of such notice.

5. Effect on Option, Restricted Stock and Restricted Unit Agreements.

         (a) In the event Options held by the Executive are assumed by the surviving entity in
connection with a Change in Control, if an Involuntary Termination of Executive’s employment occurs
following the Change of Control before the end of the CIC Period, vesting of any and all assumed
Options held by the Executive shall be accelerated so that all unexpired Options then held by the
Executive shall be fully vested and exercisable immediately upon the Involuntary Termination.

         (b) In the event Restricted Stock and RSUs held by the Executive are assumed by the surviving
entity in connection with a Change in Control, if an Involuntary Termination of Executive’s
employment occurs following the Change of Control before the end of the CIC Period, vesting of any
and all assumed Restricted Stock and RSUs held by the Executive shall be accelerated so that all
Restricted Stock and RSUs then held by the Executive shall be fully vested and exercisable
immediately upon the Involuntary Termination.

         (c) The termination of the Executive’s employment by the Company without Cause during a
Pending Change in Control shall have no effect on the vesting of the Options, Restricted Stock or
RSUs then held by the Executive, and no shares of Common Stock shall be delivered to the Executive
in connection with the RSUs held by the Executive at the time of the termination of his employment
unless the Change in Control is effected within three (3) months following the Date of Termination.
If the Change in Control is effected, then the Options, Restricted Stock and RSUs held by the
Executive as of the Date of Termination shall be treated as if the Executive’s employment had not
been terminated and the Executive shall have rights as set forth under Section 5(a) above. If the
Change in Control is not effected within three (3) months following the Date of Termination, then
the Options, Restricted Stock and RSUs held by the Executive as of the Date of Termination shall be
treated as if the Executive’s employment had been terminated as of such three-month anniversary of
the Date of Termination.

         (d) In the event the Executive’s employment is terminated by the Company under any
circumstances other than those described in paragraphs (a) through (c) of this Section 5, the
effect of such termination of employment on the Options, Restricted Stock and/or RSUs then held by
the Executive shall be as set forth in the agreements representing such Options, Restricted Stock
and/or RSUs.

6. Certain Additional Payments by the Company.

         (a) Anything in this Agreement to the contrary notwithstanding and except as set forth below,
in the event it shall be determined that any Payment would be subject to the Excise Tax, then the
Executive shall be entitled to receive an additional payment (the “Gross-Up Payment”) in an amount
such that, after payment by the Executive of all taxes (and any interest or penalties imposed with
respect to such taxes), including, without limitation, any

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income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax
imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to
the Excise Tax imposed upon the Payments.

         (b) Subject to the provisions of Section 6(c), all determinations required to be made
under this Section 6, including whether and when a Gross-Up Payment is required, the amount
of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination,
shall be made by Deloitte & Touche, LLP, or such other nationally recognized certified public
accounting firm as may be designated by the Executive (the “Accounting Firm”). The Accounting Firm
shall provide detailed supporting calculations both to the Company and the Executive within 15
business days of the receipt of notice from the Executive that there has been a Payment or such
earlier time as is requested by the Company. In the event that the Accounting Firm is serving as
accountant or auditor for the individual, entity or group effecting the Change in Control, the
Executive may appoint another nationally recognized accounting firm to make the determinations
required hereunder (which accounting firm shall then be referred to as the Accounting Firm
hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company.
Any Gross-Up Payment, as determined pursuant to this Section 6, shall be paid by the
Company to the Executive within 5 days of the receipt of the Accounting Firm’s determination. Any
determination by the Accounting Firm shall be binding upon the Company and the Executive. As a
result of the uncertainty in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not
have been made by the Company should have been made (the “Underpayment”), consistent with the
calculations required to be made hereunder. In the event the Company exhausts its remedies
pursuant to Section 6(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be paid by the Company to or for the benefit of the Executive
within ten (10) business days after the Accounting Firm has given the Company notice of the amount
it has determined to be the Underpayment.

         (c) The Executive shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of the Gross-Up Payment.
Such notification shall be given as soon as practicable, but no later than 10 business days after
the Executive is informed in writing of such claim. The Executive shall apprise the Company of the
nature of such claim and the date on which such claim is requested to be paid. The Executive shall
not pay such claim prior to the expiration of the 30-day period following the date on which the
Executive gives such notice to the Company (or such shorter period ending on the date that any
payment of taxes with respect to such claim is due). If the Company notifies the Executive in
writing prior to the expiration of such period that the Company desires to contest such claim and
the Company has a good faith basis to contest the claim, the Executive shall:

               (i) give the Company any information reasonably requested by the Company relating to such
claim,

               (ii) take such action in connection with contesting such claim as the Company shall reasonably
request in writing from time to time, including, without

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limitation, accepting legal representation with respect to such claim by an attorney
reasonably selected by the Company,

               (iii) cooperate with the Company in good faith in order effectively to contest such claim, and

               (iv) permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses
(including additional interest and penalties) incurred in connection with such contest, and shall
indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties) imposed as a result of such representation and payment of costs
and expenses. Without limitation on the foregoing provisions of this Section 6(c), the
Company shall control all proceedings taken in connection with such contest, and, at its sole
discretion, may pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the applicable taxing authority in respect of such claim and may, at its sole
discretion, either direct the Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and the Executive agrees that he will, to the extent reasonably
requested by the Company, prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company
shall reasonably determine; provided, however, that, if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such payment to the
Executive, on an interest-free basis, and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or penalties) imposed with
respect to such advance or with respect to any imputed income in connection with such advance; and
provided, further, that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested amount is claimed to be
due is limited solely to such contested amount. Furthermore, the Company’s control of the contest
shall be limited to issues with respect to which the Gross-Up Payment would be payable hereunder,
and the Executive shall be entitled to settle or contest, as the case may be, any other issue
raised by the Internal Revenue Service or any other taxing authority.

         (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to
Section 6(c), the Executive becomes entitled to receive any refund with respect to such
claim, the Executive shall (subject to the Company’s complying with the requirements of Section
6(c)) pay to the Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto), within ten (10) business days after the Executive’s
receipt thereof (which receipt shall include without limitation the recordation by the applicable
taxing authority of any credit against the Executive’s taxes). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Section 6(c), a determination is
made that the Executive shall not be entitled to any refund with respect to such claim and the
Company does not notify the Executive in writing of its intent to contest such denial of refund
prior to the expiration of 30 days after such determination, then such advance shall be forgiven
and shall not be required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

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         (e) Notwithstanding any other provision of this Section 6, the Company may, in its
sole discretion, withhold and pay over to the Internal Revenue Service or any other applicable
taxing authority, for the benefit of the Executive, all or any portion of the Gross-Up Payment, and
the Executive hereby consents to such withholding.

     7. Mitigation. In no event shall the Executive be obligated to seek other employment
or take any other action by way of mitigation of the amounts payable to the Executive under any of
the provisions of this Agreement, and except as set forth in Section 4, such amounts shall
not be reduced whether or not the Executive obtains other employment.

     8. Successors.

         (a) This Agreement is personal to the Executive, and, without the prior written consent of the
Company, shall not be assignable by the Executive other than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

         (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

         (c) The Company shall 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 assume expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession had taken place.

     9. Miscellaneous.

         (a) The captions of this Agreement are not part of the provisions hereof and shall have no
force or effect. This Agreement constitutes the entire agreement and understanding of the parties
in respect of the subject matter hereof and supersedes all prior understanding, agreements, or
representations by or among the parties, written or oral, to the extent they relate in any away to
the subject matter hereof; provided, however, this Agreement shall have no effect on any
confidentiality agreements or assignment of inventions agreements between the parties. This
Agreement may not be amended or modified other than by a written agreement executed by the parties
hereto or their respective successors and legal representatives.

         (b) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

     if to the Executive:

Hans-Georg Betz

                                        

                                        

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     if to the Company:

Advanced Energy Industries, Inc.

1625 Sharp Point Drive

Fort Collins, CO 80525

Attention: Chairman of the Board

or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.

         (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.

         (d) The Company may withhold from any amounts payable under this Agreement such United States
federal, state or local or foreign taxes as shall be required to be withheld pursuant to any
applicable law or regulation.

         (e) The Executive’s or the Company’s failure to insist upon strict compliance with any
provision of this Agreement or the failure to assert any right the Executive or the Company may
have hereunder shall not be deemed to be a waiver of such provision or right or any other provision
or right of this Agreement.

         (f) All claims by the Executive for payments or benefits under this Agreement shall be
promptly forwarded to and addressed by the Compensation Committee and shall be in writing. Any
denial by the Compensation Committee of a claim for benefits under this Agreement shall be
delivered to the Executive in writing and shall set forth the specific reasons for the denial and
the specific provisions of this Agreement relied upon. The Compensation Committee shall afford the
Executive a reasonable opportunity for a review of the decision denying a claim and shall further
allow the Executive make a written demand upon the Company to submit the disputed matter to
arbitration in accordance with the provisions of paragraph (g) below. The Company shall
pay all expenses of the Executive, including reasonable attorneys and expert fees, in connection
with any such arbitration. If for any reason the arbitrator has not made his award within one
hundred eighty (180) days from the date of Executive’s demand for arbitration, such arbitration
proceedings shall be immediately suspended and the Company shall be deemed to have agreed to
Executive’s position. Thereafter, the Company shall, as soon as practicable and in any event
within 10 business days after the expiration of such 180-day period, pay Executive his reasonable
expenses and all amounts reasonably claimed by him that were the subject of such dispute and
arbitration proceedings.

         (g) Subject to the terms of paragraph (f) above, any dispute arising from, or relating to,
this Agreement shall be resolved at the request of either party through binding arbitration in
accordance with this paragraph (g). Within 10 business days after demand for arbitration
has been made by either party, the parties, and/or their counsel, shall meet to discuss the issues
involved, to discuss a suitable arbitrator and arbitration procedure, and to agree on arbitration
rules particularly tailored to the matter in dispute, with a view to the dispute’s

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prompt, efficient, and just resolution. Upon the failure of the parties to agree upon
arbitration rules and procedures within a reasonable time (not longer than 15 business days from
the demand), the Commercial Arbitration Rules of the American Arbitration Association shall be
applicable. Likewise, upon the failure of the parties to agree upon an arbitrator within a
reasonable time (not longer than 15 business days from demand), there shall be a panel comprised of
three arbitrators, one to be appointed by each party and the third one to be selected by the two
arbitrators jointly, or by the American Arbitration Association, if the two arbitrators cannot
decide on a third arbitrator. At least 30 days before the arbitration hearing (which shall be set
for a date no later than 60 days from the demand), the parties shall allow each other reasonable
written discovery including the inspection and copying of documents and other tangible items
relevant to the issues that are to be presented at the arbitration hearing. The arbitrator(s)
shall be empowered to decide any disputes regarding the scope of discovery. The award rendered by
the arbitrator(s) shall be final and binding upon both parties. The arbitration shall be conducted
in Larimer County in the State of Colorado. The Colorado District Court located in Larimer County
shall have exclusive jurisdiction over disputes between the parties in connection with such
arbitration and the enforcement thereof, and the parties consent to the jurisdiction and venue of
such court for such purpose.

         (h) This Agreement shall be governed by the laws of the State of Colorado, without giving
effect to any choice of law provision or rule (whether of the State of Colorado or any other
jurisdiction) that would cause the application of the laws of any jurisdiction other than the State
of Colorado.

         (i) If the Company determines that any payment obligation pursuant to this Agreement will
trigger tax obligations under Section 409A of the Code, then the parties shall use their
commercially reasonable efforts to structure an alternative payment mechanism consistent with the
parties’ objectives, to the extent reasonably practicable, that will not trigger such tax
obligations under Section 409A of the Code.

[Signature Page Follows]

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth in the
Preamble hereto.

	 	 	 	 	 
	 	 	 
	 	                                           /s/ Hans-Georg Betz
 	 
	 	Hans-Georg Betz 	 
	 	 	 
	 

	 	 	 	 	 
	 	Advanced Energy Industries, Inc.

 	 
	 	By:  	/s/ Michael El-Hillow
 	 
	 	 	Michael El-Hillow 	 
	 	 	Executive Vice President 	 
	 

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ANNEX A

DEFINITIONS

         (a) “Accounting Firm” means Deloitte & Touche, LLP, or such other nationally recognized
certified public accounting firm as may be designated by the Executive as set forth in Section
6 hereof.

         (b) “Accrued Compensation” means an amount including all amounts earned or accrued through the
Date of Termination but not paid as of the Date of Termination including (i) Base Salary, (ii)
reimbursement for reasonable and necessary expenses incurred by the Executive on behalf of the
Company during the period ending on the Date of Termination, (iii) vacation and sick leave pay (to
the extent provided by Company policy or applicable law), and (iv) incentive compensation (if any)
earned in respect of any period ended prior to the Date of Termination. It is expressly
understood that incentive compensation shall have been “earned” as of the time that the conditions
to such incentive compensation have been met, even if not calculated or payable at such time.

         (c) “Agreement” means this Executive Change in Control Severance Agreement, as set forth in
the Preamble hereto.

         (d) “Applicable Benefit Plan” means any written employee benefit plan in effect and in which
the Executive participates as of the time of the termination of his employment.

         (e) “Base Salary” means the Executive’s annual base salary at the rate in effect during the
last regularly scheduled payroll period immediately preceding the occurrence of the Change in
Control or termination of employment and does not include, for example, bonuses, overtime
compensation, incentive pay, fringe benefits, sales commissions or expense allowances.

         (f) “Benefits” means the benefits for the Executive and/or the Executive’s family that are
being provided to the Executive and/or the Executive’s family immediately prior to the Date of
Termination, including the welfare benefit plans, practices, policies and programs provided by the
Company (including, without limitation, medical, prescription, dental, disability, employee life,
group life, accidental death and travel accident insurance plans and programs) and, if applicable,
car allowance, as set forth in Section 4 hereof.

         (g) “Board” means the Board of Directors of the Company, as set forth in the Recitals hereto.

         (h) “Cause” means any of the following:

               (i) the Executive’s (A) conviction of a felony; (B) commission of any other material act or
omission involving dishonesty or fraud with respect to the Company or any of its Affiliates or any
of the customers, vendors or suppliers of the Company or its Affiliates; (C) misappropriation of
material funds or assets of the Company for personal use; or (D) engagement in unlawful harassment
or unlawful discrimination with respect to any employee of the Company or any of its subsidiaries;

A-i

 

               (ii) the Executive’s continued substantial and repeated neglect of his duties, after written
notice thereof from the Board, and such neglect has not been cured within 30 days after the
Executive receives notice thereof from the Board;

               (iii) the Executive’s gross negligence or willful misconduct in the performance of his duties
hereunder that is materially and demonstrably injurious to the Company; or

               (iv) the Executive’s engaging in conduct constituting a breach of his written obligations to
the Company in respect of confidentiality and/or the use or ownership of proprietary information.

         (i) “Change in Control” shall be deemed to occur upon the consummation of any of the following
transactions:

               (i) a merger or consolidation in which the Company is not the surviving entity, except for a
transaction the principal purpose of which is to change the state of the Company’s incorporation or
a transaction in which 50% or more of the surviving entity’s outstanding voting stock following the
transaction is held by holders who held 50% or more of the Company’s outstanding voting stock prior
to such transaction; or

               (ii) the sale, transfer or other disposition of all or substantially all of the assets of the
Company; or

               (iii) any reverse merger in which the Company is the surviving entity, but in which 50% or
more of the Company’s outstanding voting stock is transferred to holders different from those who
held the stock immediately prior to such merger; or

               (iv) the acquisition by any person (or entity), other than Douglas Schatz and/or any of his
affiliates or members of his immediate family, directly or indirectly of 50% or more of the
combined voting power of the outstanding shares of Common Stock.

         (j) “CIC Period” means the 30-day period commencing on the date that is six months following
the effective date of a Change in Control and ending on the date that is thirty (30) days
thereafter.

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

         (l) “Common Stock” means common stock, par value $0.001, of the Company.

         (m) “Company” means Advanced Energy Industries, Inc., a Delaware corporation, as set forth in
the Preamble hereto.

         (n) “Date of Termination” means (i) if the Executive’s employment is terminated for Cause, the
date of receipt by the Executive of written notice from the Board or the Chief Executive Officer
that the Executive has been terminated, or any later date specified therein, as the case may be,
(ii) if the Executive’s employment is terminated by the Company

A-ii

 

other than for Cause, death or Long-Term Disability, the date specified in the Company’s
written notice to the Executive of such termination, (iii) if the Executive’s employment is
terminated by reason of the Executive’s death or Long-Term Disability, the date of such death or
the effective date of such Long-Term Disability, (iv) if the Executive’s employment is terminated
by Executive’s resignation that constitutes Involuntary Termination under this Agreement, the date
of the Company’s receipt of the Executive’s notice of termination or any later date specified
therein.

         (o) “Effective Date” means the date set forth in the Preamble hereto.

         (p) “Executive” means the individual identified in the Preamble hereto.

         (q) “Excise Tax” means the excise tax imposed by Section 4999 of the Code, together with any
interest or penalties imposed with respect to such excise tax.

         (r) “Good Reason” means any of the following:

               (i) a material reduction in the Executive’s duties, level of responsibility or authority,
other than (A) reductions solely attributable to the Company ceasing to be a publicly held company
or becoming a subsidiary or division of another company, or (B) isolated incidents that are
promptly remedied by the Company; or

               (ii) a reduction in the Executive’s Base Salary, without (A) the Executive’s express written
consent or (B) an increase in the Executive’s benefits, perquisites and/or guaranteed bonus, which
increase(s) have a value reasonably equivalent to the reduction in Base Salary; or

               (iii) a reduction in the Executive’s Target Bonus, without (A) the Executive’s express written
consent or (B) an corresponding increase in the Executive’s Base Salary; or

               (iv) a material reduction in the Benefits, taken as a whole, without the Executive’s express
written consent; or

               (v) the relocation of the Executive’s principal place of business to a location more than
thirty-five (35) miles from the Executive’s principal place of business immediately prior to the
Change in Control, without the Executive’s express written consent; or

               (vi) the Company’s (or its successor’s) material breach of this Agreement.

         (s) “Gross-Up Payment” means an additional payment that the Executive is entitled to receive
for any Payment subject to the Excise Tax, as set forth in Section 6 hereof.

         (t) “Involuntary Termination” means the termination of Executive’s employment with the
Company:

A-iii

 

               (i) by the Company without Cause,

               (ii) by the Executive for Good Reason following a Change in Control, or

               (iii) by the Executive during the CIC Period;

	as set forth in Section 3 hereof.

         (u) “Long-Term Disability” is defined according to the Company’s insurance policy regarding
long-term disability for its employees.

         (v) “Parachute Value” of a Payment means the present value as of the date of the change of
control for purposes of Section 280G of the Code of the portion of such Payment that constitutes a
“parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm for purposes of
determining whether and to what extent the Excise Tax will apply to such Payment.

         (w) A “Payment” means any payment or distribution in the nature of compensation (within the
meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or
payable pursuant to this Agreement or otherwise.

         (x) “Pending Change in Control” means that one or more of the following events has occurred
and a Change in Control pursuant thereto is reasonably expected to be effected within 90 days of
the date as of the determination as to whether there is a Pending Change in Control: (i) the
Company executes a letter of intent, term sheet or similar instrument with respect to a transaction
or series of transactions, the consummation of which transaction(s) would result in a Change in
Control; (ii) the Board approves a transaction or series of transactions, the consummation of which
transaction(s) would result in a Change in Control; or (iii) a person makes a public announcement
of tender offer for the Common Stock, the completion of which would result in a Change in Control.
A Pending Change in Control shall cease to exist upon a Change in Control.

         (y) “Pro Rata Bonus” means an amount equal to 100% of the Target Bonus that the Executive
would have been eligible to receive for the Company’s fiscal year in which the Executive’s
employment terminates following a Change in Control, multiplied by a fraction, the numerator of
which is the number of days in such fiscal year through the Termination Date and the denominator of
which is 365.

         (z) “Restricted Stock” means Common Stock issued by the Company with vesting restrictions and
subject to an award agreement pursuant to a stock plan of the Company.

         (aa) “RSUs” mean restricted stock units granted by the Company pursuant to which the Company
has agreed to issue Common Stock upon the satisfaction of vesting and other conditions, which RSUs
are subject to an award agreement pursuant to a stock plan of the Company.

A-iv

 

         (bb) “Target Bonus” means the bonus which would have been paid to the Executive for full
achievement of the Company’s base business plan or budget and/or for the attainment of specific
performance objectives pertaining to the business of the Company or any of its specific business
units or divisions, or to individual performance criteria applicable to the Executive or his
position, which objectives have been established by the Board of Directors (or the Compensation
Committee thereof) for the Executive relating to such plan or budget for the year in question.
“Target Bonus” shall not mean the “maximum bonus” which the Executive might have been paid for
overachievement of such plan.

         (cc) “Underpayment” means Gross-Up Payments that have not been made by the Company and should
have been made, as set forth in Section 6 hereof.

         (dd) “Value” of a Payment means the economic present value of a Payment as of the date of the
change of control for purposes of Section 280G of the Code, as determined by the Accounting Firm
using the discount rate required by Section 280G(d)(4) of the Code.

         (ee) “Voluntary Resignation” means the termination of the Executive’s employment upon his
voluntary resignation, which includes retirement, as set forth in Section 3 hereof.

A-vexv4w03

 

Exhibit 4.03

CERTIFICATE OF AMENDMENT

OF

RESTATED CERTIFICATE OF INCORPORATION

OF

SYMANTEC CORPORATION

     Symantec Corporation, a Delaware corporation, does hereby certify that the following
amendments to the corporation’s Restated Certificate of Incorporation have been duly adopted in
accordance with the provisions of Section 242 of the Delaware General Corporation Law, with the
approval of such amendments by the corporation’s stockholders:

     Article 4.1 of the Restated Certificate of Incorporation is amended to read in its entirety
as follows:

Classes of Stock. The Corporation is authorized to issue three classes of stock to be
designated “Common Stock,” “Preferred Stock” and “Special Voting Stock.” Each share of
Common Stock and each share of Preferred Stock shall have a par value of $0.01. Each share
of Special Voting Stock shall have a par value of $1.00. The total number of shares which
the Corporation is authorized to issue is three billion one million and one (3,001,000,001).
Three billion (3,000,000,000) shares shall be Common Stock, one million (1,000,000) shares
shall be Preferred Stock and one (1) share shall be Special Voting Stock.

     Article 4.2 of the Restated Certificate of Incorporation is amended to read in its entirety
as follows:

Rights, Privileges and Restrictions. The rights, privileges and restrictions of the
Common Stock and the Special Voting Stock shall be set forth in this Article 4.

     Article 4.4 of the Restated Certificate of Incorporation is amended to read in its entirety
as follows:

Voting Rights.

4.4.1 General. Except as otherwise required by law or this Amended and Restated Certificate
of Incorporation, (i) each holder of record of Common Stock shall have one vote in respect
of each share of stock held by the holder of the books of the Corporation and (ii) the
holder of record of the share of Special Voting Stock shall have a number of votes equal to
the number of Exchangeable Non-Voting Shares (“Exchangeable Shares”) of Telebackup
Exchangeco Inc., an Alberta corporation, outstanding as of the

 

 

applicable record date (excluding Exchangeable Shares which are owned by the Corporation,
any of its subsidiaries or any person directly or indirectly controlled by or under common
control of the Corporation), in each case for the election of directors and on all matters
submitted to a vote of stockholders of the Corporation. For the purposes hereof, “control”
(including the correlative meanings, the terms “controlled by” and “under common control
of”) as applied to any person, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of that person through the
ownership of voting securities, by contract or otherwise.

4.4.2 Common Stock and Special Voting Stock Identical in Voting. In respect of all matters
concerning the voting of shares, the Common Stock and the Special Voting Stock shall vote as
a single class and such voting rights shall be identical in all respects.

4.4.3 Vacancies on the Board of Directors. Any vacancy in the Board of Directors occurring
because of the death, resignation or removal of a director elected by the holders of Common
Stock and Special Voting Stock shall be filled by the vote or written consent of the holders
of such Common Stock and Special Voting Stock or, in the absence of action by such holders,
such vacancy shall be filled by action of the remaining directors. A director elected by the
holders of Common Stock and Special Voting Stock may be removed from the Board of Directors
with or without cause by the vote or consent of the holders of such Common Stock and Special
Voting Stock, as provided by the Delaware General Corporation Law.

     Article 4.5 of the Restated Certificate of Incorporation is amended to read in its entirety
as follows:

Liquidation. In the event of any liquidation, dissolution or winding up of the corporation,
the holders of Common Stock shall be entitled to receive, pro rata, all of the remaining
assets of the Corporation available for distribution to its stockholders and the holders of
the Special Voting Stock shall not be entitled to receive any such assets.

     Article 4.6 of the Restated Certificate of Incorporation is amended to read in its entirety
as follows:

Dividends. The holders of shares of Common Stock shall be entitled to receive, when, as and
if declared by the Board of Directors, out of the assets of the Corporation which are by law
available therefor, dividends payable either in cash, in property or in shares of capital
stock and the holders of Special Voting Stock shall not be entitled to receive any such
dividends.

     Article 4.7 reading in its entirety as follows is hereby added to the Restated Certificate of
Incorporation:

Special Voting Stock.

4.7.1 Exercise of Voting Rights. The holder of the share of Special Voting Stock is
entitled to exercise the voting rights attendant thereto in such manner as such holder
desires.

 

 

4.7.2 Cancellation of Shares. At such time as the Special Voting Stock has no votes
attached to it because there are no Exchangeable Shares of Telebackup Exchangeco Inc.
outstanding which are not owned by the Corporation, any of its subsidiaries or any person
directly or indirectly controlled by or under common control of the Corporation, and there
are no shares of stock, debt, options or other agreements of Telebackup Exchangeco Inc.
which could give rise to the issuance of any Exchangeable Shares of Telebackup Exchangeco
Inc. to any person (other than the Corporation, any of its subsidiaries or any person
directly or indirectly controlled by or under common control of the Corporation), the
Special Voting Stock shall be automatically canceled.

 

 

     IN WITNESS WHEREOF, said corporation has caused this Certificate of Amendment to be signed by
its duly authorized officer this 1st day of July, 2005 and the foregoing facts stated herein are
true and correct.

	 	 	 	 	 
	 	 	SYMANTEC CORPORATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Arthur F. Courville
	 

	 	 	 	 
	 

	 	 	 	Arthur F. Courville
	 

	 	 	 	Senior Vice President, General Counsel
	 

	 	 	 	and Secretary

[SIGNATURE PAGE TO CERTIFICATE OF AMENDMENT OF RESTATED

CERTIFICATE OF INCORPORATION]

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