Document:

Exhibit
10.1

October 30, 2006

Rich Rowley

Dear Rich:

On behalf of Adobe Systems
Incorporated, I am pleased to offer you the position of Vice President,
Corporate Controller and Chief Accounting Officer, reporting to me, based in
San Jose. We recognize that employees are at the core of our success, and we
look forward to having you join the other highly qualified and motivated
individuals who work at Adobe.

Compensation: The base compensation for this Exempt
position will be $23,333.33 per month ($280,000.00 annually).

Stock Options: Adobe inspires employees to contribute at peak
performance and share in the success of the company and you will be
offered the opportunity to purchase 50,000 shares of Common Stock under the
Adobe Equity Incentive Plan. These shares and the price at which you would be
able to purchase them are subject to the approval of the Board of Directors and
to the terms of the Plan. A schedule outlining the vesting provisions is
included for your information.

Performance
Share Program: You will
also have the opportunity to participate in Adobe’s Performance Share Program
subject to the approval of the Board of Directors.  The proposed target award of 5,000
performance shares will vest after the completion of Adobe’s fiscal year 2007
based on the achievement of specific performance metrics outlined in the
attached Program Summary.  Based on
achievement of the performance metrics, you could earn between 0% and 150% of
your target award.

Annual Incentive Plan (AIP)
Bonus: You will also
qualify for an Annual Incentive Plan (AIP) bonus of up to 40% of your annual
base salary per year. The AIP period for FY 2007 is defined as December 4, 2006
through the last U.S. business day in November 2007. If you start prior to
FY2007, you will also be eligible to receive a prorated bonus for the remainder
of the FY2006 AIP period if the Company achieves its budgeted operating profit
and revenue during that fiscal year and your individual goals are achieved.

Profit Sharing: Eligible employees participate in a corporate
profit sharing plan, which pays up to 10% of your base salary.  The profit sharing period for Q4 2006 is
defined as September 4, 2006 through November 30, 2006. If you are hired after
the Q4 2006 start date, you are eligible to receive a prorated bonus if you are
employed for the remainder

 

of the Q4 2006 period and
the Company achieves its budgeted operating profit during that fiscal quarter.

Benefits: Upon your date of hire, you will be eligible
to take advantage of our comprehensive benefits package, which includes your
choice of medical and dental plans, vision care, life insurance and disability
coverage as well as health care, dependent care reimbursement accounts, and
much more. You may also participate in Adobe’s 401(k) Retirement Savings Plan
and the Employee Stock Purchase Plan. A benefit summary outlining all of our
benefits is included with this offer letter.

Contingencies:
You must sign the
Employee Inventions and Proprietary Rights Assignment Agreement as a condition
of your employment. This offer is contingent upon successful completion of a
background check.

This offer is also
contingent upon your providing us with the information requested in the Export
Control Questionnaire within seven days of receipt of this offer to allow us to
determine if you require an export license. If so, this offer is contingent
upon the receipt of any export license or any other approval that may be
required under the United States export control laws and regulations.

This offer is also
contingent upon obtaining the necessary work authorization. Adobe will apply
for the appropriate visa on your behalf. Attached is a checklist of the
necessary items to begin obtaining your required visa.

In accordance with the
requirements of the Immigration Reform and Control Act of 1986, you will be
required to provide verification of your identity and legal right to work in
the United States. Employment with Adobe is for no specified period and may be
terminated by you or the company at any time, for any reason or no reason. This
letter, along with any agreements relating to proprietary rights between you
and Adobe, set forth the terms of your employment with Adobe and supersede any
prior representations or agreements, whether written or oral. This letter may
not be modified or amended except by a written agreement, signed by Adobe and
by you.

Upon acceptance of our
offer, please sign and return this letter and the enclosed documents to the
Human Resources Department in the envelope provided ASAP. We appreciate the
prompt return of the requested documents so we will be able to have your
information ready when you arrive. (In order to have your systems set up for
your first day, all documents must be received 5 full business days prior to
your start date.) If you have any questions regarding the details of this
offer, please contact me. This offer will be valid until November 6, 2006.

To officially welcome you to
Adobe, we’d like to invite you to attend Adobe’s New Employee Orientation,
which is held in the San Jose office each Monday from 9:30am-4:15pm.  Once we receive your signed paperwork, we’ll
send you a confirmation email that will outline the details of the orientation,
including which day you are scheduled to attend.

Rich, welcome to the Adobe
team. We’re proud of the energizing culture and environment here, and are
confident you will soon discover why it’s simply better at Adobe. We look
forward to your contributions to Adobe’s ongoing success.

 

 

	
  Sincerely,

  
	
   

  
	
  /s/ Randy Furr

  	
   

  
	
   

  
	
  Randy Furr

  
	
  Chief Financial
  Officer and Executive VP

  

 

I accept this offer and I
understand that I am required to sign and return the enclosed Employee
Inventions and Proprietary Rights Assignment Agreement and the Export Control
Questionnaire before starting employment with Adobe Systems.

	
  /s/ Rich Rowley

  	
   

  
	
  Signature

  
	
  October 31, 2006

  	
   

  
	
  Accept Date

  
	
  November 13,
  2006

  	
   

  
	
  Start Date

  
			

 

RF/jk

Enclosures:

Employee Input Sheet
Form W4
Employee Inventions and Proprietary
Rights Assignment Agreement
Employment Eligibility Verification
Export Control Questionnaire

cc: Human ResourcesExhibit 10.2

ADOBE SYSTEMS INCORPORATED

EXECUTIVE SEVERANCE PLAN

IN THE
EVENT OF A CHANGE OF CONTROL

Adobe Systems Incorporated, a Delaware corporation
(the “Company”) has adopted this Executive Severance Plan (the “Plan”),
effective as of December 12, 2006,
for the benefit of certain key employees of the Participating Company Group.

The
Company considers it essential to the best interests of its stockholders to
take reasonable steps to retain its key management personnel.  Further, the Board of Directors of the
Company (the “Board”) recognizes that the uncertainty and questions which might
arise among management in the context of a Change of Control of the Company
could result in the departure or distraction of management personnel to the
detriment of the Company and its stockholders.

The
Board has determined, therefore, that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of its members
of management of the Company to their assigned duties without distraction in
the face of potentially disturbing circumstances arising from any possible
Change of Control of the Company.

The
Company hereby adopts this Executive Severance Plan In the Event of a Change of
Control for the benefit of its employees who are eligible as provided in the
Plan.

Section 1.               Definitions.

1.1           “Accounting Firm”
shall mean KPMG LLP or, if such firm is unable or unwilling to perform the
calculations required under this Plan, such other national accounting firm as
shall be designated by agreement between the Participant to whom Section 4.1
applies and the Company.

1.2           “Base Salary”
means the Participant’s annual base salary as in effect during the last
regularly scheduled payroll period immediately preceding such Participant’s
Date of Termination.  Base Salary does
not include any bonuses, commissions, fringe benefits, overtime, car
allowances, other irregular payments or any other compensation except base
salary.

1.3           “Cause” shall
mean (a) with respect to Group I Participants (i) felony conviction; or (ii)
willful disclosure of material trade secrets or other material confidential
information related to the business of a Participating Company; or (iii)
willful and continued failure substantially to perform the same duties as in
effect prior to the Change of Control for the Participating Company (other than
any such failure resulting from physical or mental incapacity or any actual or
anticipated failure resulting from a resignation for Good Reason) after a
written demand for substantial performance is delivered by the Chief Executive
Officer or the President of the Company, which demand identifies the specific
actions which the Chief Executive Officer or the President of the Company
believes constitute willful and continued failure substantially to perform
duties, and which performance is not substantially corrected within ten (10)
days of receipt of such demand.  For
purposes of the previous sentence, no act or failure to act shall be deemed “willful”
unless done, or omitted to be done, with willful malfeasance or gross
negligence and without reasonable belief that action or omission was not
materially adverse to

 

the best interest
of the Participating Company Group; and (b) with respect to Group II
Participants (i) theft, dishonesty or falsification of any employment or
Participating Company Group records, (ii) improper disclosure of a
Participating Company’s confidential or proprietary information, (iii) any
intentional act by such Participant which has a material detrimental effect on
the Participating Company Group’s reputation or business, (iv) failure to
perform any reasonably assigned duties, which failure is not cured with in
thirty (30) days following written notice of such failure from the
Participating Company, (v) gross misconduct or (vi) felony conviction.

1.4           “Change of Control”
shall mean a Change of Control of the Company of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Exchange Act, whether or not the Company is then
subject to such reporting requirement; provided, however, that anything in this
Plan to the contrary notwithstanding, a Change of Control shall be deemed to
have occurred if:

(a)           any individual,
partnership, firm, corporation, association, trust, unincorporated organization
or other entity or person, or any syndicate or group deemed to be a person
under Section 14(d)(2) of the Exchange Act, is or becomes the “beneficial owner”
(as defined in Rule 13d-3 of the General Rules and Regulations under the
Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company’s then
outstanding securities entitled to vote in the election of directors of the
Company;

(b)           during any period of
two (2) consecutive years (not including any period prior to the Effective
Date), individuals who at the beginning of such period constituted the Board
and any new directors, whose election by the Board or nomination for election
by the Company’s stockholders was approved by a vote of at least three-fourths
(3/4ths) of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved (the “Incumbent Directors”),
cease for any reason to constitute a majority thereof;

(c)           there occurs a
reorganization, merger, consolidation or other corporate transaction involving
the Company (a “Transaction”), in each case
with respect to which the stockholders of the Company immediately prior to such
Transaction do not, immediately after the Transaction, own securities
representing more than 50% of the combined voting power of the Company, a
parent of the Company or other corporation resulting from such Transaction
(counting, for this purpose, only those securities held by the Company’s
stockholders immediately after the Transaction that were received in exchange
for, or represent their continuing ownership of, securities of the Company held
by them immediately prior to the Transaction);

(d)           all or substantially
all of the assets of the Company are sold, liquidated or distributed; or

(e)           there is a “Change of
Control” or a “change in the effective control” of the Company within the
meaning of Section 280G of the Code and the Regulations.

 2
 

 

1.5           “Change of Control
Date” shall mean the date on which the Change of Control occurs.  Notwithstanding the first sentence of this
definition, if a Participant’s employment with the Participating Company Group
terminates prior to the Change of Control Date and it is reasonably
demonstrated that such termination (a) was at the request of the third party
who has taken steps reasonably calculated to effect the Change of Control or
(b) otherwise arose in connection with or in anticipation of the Change of
Control, then “Change of Control Date” shall mean the date immediately prior to
the date of such Participant’s termination of employment.

1.6           “Code” shall
mean the Internal Revenue Code of 1986, as amended, and any successor
provisions thereto.

1.7           “Committee”
means the Executive Severance Plan Administrative Committee responsible for
administering the Plan as provided in Section 5.

1.8           “Common Stock”
shall mean the common stock of the Company.

1.9           “Company”
means Adobe Systems Incorporated, a Delaware Corporation, and, except in
determining under Section 1.4 hereof whether or not any Change of Control has
occurred, shall include any successor to its business and/or assets.

1.10         “Date
of Termination” means the date of a Participant’s termination of employment
with the Participating Company Group as determined in accordance with Section
3.6.

1.11         “Disability” shall
mean a Participant’s (a) incapacity due to physical or mental illness which
causes such Participant’s absence from the full-time performance of his or her
duties with the Participating Company Group for six (6) consecutive months and
(b) such Participant’s failure to return to full-time performance of his or her
duties for the Participating Company Group within thirty (30) days after
written Notice of Termination due to Disability is given to a Participant.  Any question as to the existence of
Disability upon which a Participant and the Participating Company Group cannot
agree shall be determined by a qualified independent physician selected by the
Participant (or, if such Participant is not able to select a physician, such
selection shall be made by any adult member of the Participant’s immediate
family), and approved by the Participating Company Group.  The determination of such physician made in
writing to the Participating Company Group shall be final and conclusive for
all purposes of this Plan.

1.12         “Effective Date”
means December 12, 2001.

1.13         “Equity Awards”
shall mean options, restricted stock, bonus stock or other grants or awards
which consist of, or relate to, equity securities of the Company and which have
been granted to Participant’s under the Equity Plans.  For purposes of this Plan, Equity Awards
shall also include any securities acquired upon the exercise of an option,
warrant or similar right that constitutes an Equity Award.

1.14         “Equity Plans”
shall mean the Adobe Systems Incorporated 1994 Stock Option Plan, the Adobe
Systems Incorporated 1994 Amended Performance and Restricted Stock Plan, the
Adobe Systems Incorporated 1999 Nonstatutory Stock Option Plan, the Adobe
Systems

 3
 

 

Incorporated 2003
Equity Incentive Plan, the Adobe Systems Incorporated 2005 Special Purpose
Equity Incentive Plan, and any other equity-based incentive plan or
arrangement adopted or assumed by the Company, and any future equity-based
incentive plan or arrangement adopted or assumed by the Company, but shall not
include the Adobe Systems Incorporated 1997 Employee Stock Purchase Plan or any
other plan intended to be qualified under Section 423 of the Code.

1.15         “ERISA” means the
Employee Retirement Income Security Act of 1974, as amended.

1.16         “Exchange Act”
shall mean the Securities Exchange Act of 1934, as amended, and any successor
provisions thereto.

1.17         “Good Reason”
shall mean a Participant’s resignation of employment during the Term as a
result of any of the following:

(a)           A meaningful and
detrimental alteration in such Participant’s position, titles, or the nature or
status of responsibilities (including reporting responsibilities) from those in
effect immediately prior to the Change of Control Date;

(b)           A reduction by the
Participating Company Group in such Participant’s Base Salary as in effect
immediately prior to the Change of Control Date or as the same may be increased
from time to time thereafter; a failure by the Participating Company Group to
increase such Participant’s salary at a rate commensurate with that of other similarly
situated key executives of the Participating
Company Group; or a reduction in the target incentive opportunity percentage
used to determine such Participant’s Target Bonus below the percentage in
effect immediately prior to the Change of Control Date;

(c)           The relocation of the
office of the Participating Company where such Participant is primarily employed
immediately prior to the Change of Control Date (the “COC
Location”) to a location which is more than fifty (50) miles
away from the COC Location or the Participating Company’s requiring such
Participant to be based more than fifty (50) miles away from the COC Location (except
for required travel on the Participating Company’s business to an extent
substantially consistent with the Participant’s customary business travel
obligations in the ordinary course of business prior to the Change of Control
Date);

(d)           The failure by the
Participating Company Group to continue in effect any compensation plan in
which such Participant participated prior to the Change of Control Date or made
available to such Participant after the Change of Control Date, unless an
equitable arrangement (embodied in an ongoing substitute or alternative plan)
has been made with respect to such plan in connection with the Change of
Control, or the failure by the Participating Company Group to continue such
Participant’s participation therein on at least as favorable a basis, both in
terms of the amount of benefits provided and the level of participation
relative to other participants, as existed on the Change of Control Date;

(e)           The failure by the
Participating Company Group to continue to provide such Participant with
benefits at least as favorable in the aggregate to those enjoyed by such
Participant under the Participating Company Group’s retirement, savings, life
insurance, medical, health and accident, disability, and fringe benefit plans
and programs in which such

 4
 

 

Participant was participating in immediately prior to
the Change of Control Date; or the failure by the Participating Company Group
to provide such Participant with the number of paid vacation days to which he
or she was entitled on the basis of years of service with the Participating
Company Group in accordance with the Participating Company Group’s normal
vacation policy in effect immediately prior to the Change of Control;

(f)            The failure by the
Participating Company Group to pay or provide to such Participant with any
material item of compensation or benefits promptly when due;

(g)           The failure of the
Participating Company Group to obtain an agreement from any successor to assume
and agree to perform the obligations of this Plan, as contemplated in Section
9.1 hereof or, if the business for which such Participant’s services are
principally performed is sold at any time after a Change of Control, the
failure of the Participating Company Group to obtain such an agreement from the
purchaser of such business;

(h)           A
material breach by the Participating Company Group of the provisions of this
Plan;

 provided, however, that an event described above in clause (a), (b),
(d), (e), (f) or (h) shall not constitute Good Reason unless it is communicated
by such Participant to the Company in writing and is not corrected by the
Company in a manner which is reasonably satisfactory to such Participant
(including full retroactive correction with respect to any monetary matter)
within 10 days of the Company’s receipt of such written notice.

1.18         “Group I Participant”
shall mean each senior management employee of a Participating Company who (i)
is on the U.S. payroll, (ii) is not a party to any other retention and/or
severance agreement with the Participating Company Group that is not otherwise
waived in accordance with Section 3.9, and (iii) on the Change of Control Date,
is classified as a Vice President (or any more senior role) of a Participating
Company.

1.19         “Group II Participant”
shall mean each senior management-level employee of a Participating Company who
(i) is on the U.S. payroll, (ii) is not a party to any other retention and/or
severance agreement with the Participating Company Group that is not otherwise
waived in accordance with Section 3.9, and (iii) who on the Change of Control
Date, is classified as a Director, Senior Director, or such other position,
which is determined by the Company prior to the Change of Control as equivalent
thereto.

1.20         “Involuntary
Termination” shall mean (i) a Participant’s involuntary termination of
employment with the Participating Company Group during the Term other than for
death, Disability or Cause or (ii) a Participant’s resignation of
employment with the Participating Company Group during the Term for Good
Reason.

1.21         “Notice of Termination”
means the notice specified in Section 3.6.

1.22         “Participating Company
Group” means the Company and any present or future United States parent
and/or United States direct or indirect subsidiary corporations of the Company
that have been designated by the Board as a “Participating Company” for
purposes of this Plan (all of which along with the Company being individually
referred to as a “Participating

 5
 

 

Company” and
collectively referred to as the “Participating Company Group”).  For purposes of this Plan, a parent or
subsidiary corporation shall be defined in Sections 424(e) and 424(f) of the
Code and shall include entities related to the Company by similar ownership
levels that are not corporations.

1.23         “Participant”
shall mean each Group I Participant and each Group II Participant.

1.24         “Plan” means this
Adobe Systems Incorporated Executive Severance Plan In the Event of a Change of
Control.

1.25         “Plan Year” means
the calendar year and the last day of such year is December 31.

1.26         “Reference Bonus”
shall mean the greater of (a) the Target Bonus applicable to a Participant for
the year in which such Participant’s Involuntary Termination occurs or (b) the
highest Target Bonus applicable to such Participant in any of the three years
ending prior to the Change of Control Date.

1.27         “Reference Salary”
shall mean the greater of (a) the annual rate of a Participant’s Base Salary
from the Participating Company Group in effect immediately prior to the date of
such Participant’s Involuntary Termination or (b) the annual rate of a
Participant’s Base Salary from the Participating Company Group in effect at any
point during the three-year period ending on the Change of Control Date.

1.28         “Regulations”
shall mean the proposed, temporary and final regulations under Section 280G of
the Code or any successor provision thereto.

1.29         “Severance Benefits”
means those benefits provided to a Participant under this Plan on account of a
Change of Control, as determined in accordance with Section 3.2, 3.3 and 3.4
after the execution of a release of claims as required by Section 10.

1.30         “Severance Multiple”
shall mean (a) with respect to Group I Participants, the sum of (i) two (2)
plus (ii) one twelfth (1/12th)
for each completed year of service with the Participating Company Group (not in
excess of twelve (12) years), and (b) with respect to Group II Participants,
the sum of (i) one (1) plus (ii) one twelfth (1/12th) for each completed year of service with
the Participating Company Group (not in excess of six (6) years).

1.31         “Target Bonus”
shall mean an amount equal to (i) a Participant’s Base Salary multiplied by
such Participant’s target incentive opportunity percentage under the
Participating Company’s Annual Incentive Plan and Profit Sharing Plan (or any
successor plans then in effect), and (ii) 
target commissions.

1.32         “Term” shall mean
the period of a Participant’s employment that commences on the Change of
Control Date and shall continue until the second anniversary of the Change of
Control Date.

 6
 

 

Section 2.               Employment
During the Term.  During the Term,
the following terms and conditions shall apply to a Participant’s employment
with the Participating Company Group:

2.1           Titles; Reporting
and Duties.  A Participant’s
position, title, nature and status of responsibilities and reporting
obligations shall be no less favorable than those that such Participant enjoyed
immediately prior to the Change of Control Date.

2.2           Base Salary and
Bonus.  A Participant’s Base Salary
and annual bonus opportunity may not be reduced, and such Participant’s Base
Salary shall be periodically reviewed and increased in the manner commensurate
with increases awarded to other similarly situated employees of the
Participating Company Group.

2.3           Incentive
Compensation.  A Participant shall be
eligible to participate in each long-term incentive plan or arrangement
established by the Participating Company Group for its employees at such
Participant’s level of seniority in accordance with the terms and provisions of
such plan or arrangement and at a level consistent with the Participating
Company Group’s practices applicable to each Participant prior to the Change of
Control Date.

2.4           Benefits.  A Participant shall be eligible to
participate in all retirement, welfare and fringe benefit plans and
arrangements that the Participating Company Group provides to its employees in
accordance with the terms of such plans and arrangements, which shall be no
less favorable to such Participant, in the aggregate, than the terms and
provisions available to other similarly situated employees of the Participating
Company Group.

2.5           Location.  A Participant shall continue to be employed
at a business location in the metropolitan area in which such Participant was
employed prior to the Change of Control Date and the amount of time that such
Participant is required to travel for business purposes will not be increased
in any significant respect from the amount of business travel required of such
Participant prior to the Change of Control Date.

Section 3.               Severance
Benefits.  In the event of a
Participant’s Involuntary Termination, the terminated Participant shall be
entitled to the following:

3.1           Payment of Wages and
Accrued Vacation.  The Company shall
pay to such terminated Participant within five (5) days of the date of such
Involuntary Termination the full amount of any earned but unpaid Base Salary
through the Date of Termination at the rate in effect at the time of the Notice
of Termination, plus a cash payment (calculated on the basis of such Participant’s
Base Salary) for all unused vacation time which such Participant may have
accrued as of the Date of Termination.

3.2           Payment
of Cash Severance.  Subject to
execution of a release of claims as described in Section 10 below, the
terminated Participant will receive the following cash benefits:

(a)           The Company shall pay
to such terminated Participant within five (5) days of the Date of Termination
a pro rata portion of the Participant’s Target Bonus for the year in which such
Involuntary Termination occurs, calculated on the assumption that all
performance targets have been or will be achieved.

 7
 

 

(b)           In addition, the
Company shall pay to such terminated Participant in a cash lump sum, within
eight (8) days following the date such terminated Participant executes the
release described in Section 10 (or on the Date of Termination, if later) an
amount equal to the product of (a) the sum of such terminated Participant’s
Reference Salary and Reference Bonus, multiplied by (b) such terminated
Participant’s Severance Multiple.  This
severance payment shall be in lieu of any other cash severance payments which
such terminated Participant is entitled to receive under any other severance
pay and/or retention plan or arrangement sponsored by any Participating
Company.

3.3           Vesting
and Exercise of Equity Awards. 
Subject to execution of a release of claims as described in Section 10
below, and notwithstanding anything to the contrary contained in an applicable
Equity Award, all Equity Awards granted to a terminated Participant under the
Equity Plans (except performance share unit awards, which shall continue to be
governed by their current terms) shall vest in full and become exercisable,
upon the Participant’s Involuntary Termination during the Term.  Notwithstanding anything in this Plan to the
contrary, in no event shall the vesting and exercisability provisions
applicable to a terminated Participant under the terms of an Equity Award be
less favorable to such Participant than the terms and provisions of such awards
in effect on the Change of Control Date.

3.4           Benefits
Continuation.  Subject to execution
of a release of claims as described in Section 10 below, and subject to the
terminated Participant and/or his or her eligible dependents electing continued
medical insurance coverage in accordance with the applicable provisions of
federal law (commonly referred to as “COBRA”),
the Company shall pay the terminated Participant’s COBRA premiums for the
duration of such COBRA coverage, or for the period of years equal to the Participant’s
Severance Multiple, whichever is less. 
If the terminated Participant’s medical coverage immediately prior to
the Date of Termination included the terminated Participant’s dependents, the
Company paid COBRA premiums shall include the premiums necessary for such
dependents as have elected COBRA coverage. 
Notwithstanding the above, in the event the terminated Participant
becomes covered under another employer’s group health plan (other than a plan
which imposes a preexisting condition exclusion unless the preexisting
condition exclusion does not apply) during the period provided in this Section
3.4, the Company shall cease payment of the COBRA premiums.

3.5           Other
Benefit Plans.  A terminated
Participant’s participation and rights in other benefit plans as may be
provided by the Participating Company Group at the time of his/her Involuntary
Termination shall be governed solely by the terms and conditions of such plans,
if any.

3.6           Date
and Notice of Termination.  Any
termination of a Participant’s employment by a Participating Company or by such
Participant during the Term shall be communicated by a notice of termination to
the other party hereto (the “Notice of Termination”).  The Notice of Termination shall indicate the
specific termination provision in this Plan relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Participant’s employment under the provision so
indicated.  The date of a Participant’s
termination of employment with the Participating Company Group shall be
determined as follows:  (i) if employment
is terminated by the Participating Company Group in an Involuntary Termination,
five (5) days after the date the Notice of Termination is provided by

 8
 

 

the Participating Company Group, (ii) if
employment is terminated by the Participating Company Group for Cause, the
later of the date specified in the Notice of Termination or ten (10) days
following the date such notice is received by the Participant, and (iii) if the
basis of a Participant’s Involuntary Termination is such Participant’s
resignation for Good Reason, the Date of Termination shall be ten (10) days
after the date such Participant’s Notice of Termination is received by the
Company.

3.7           No
Mitigation or Offset.  A terminated
Participant shall not be required to mitigate the amount of any payment
provided for in this Plan by seeking other employment or otherwise, nor shall
the amount of any payment or benefit provided for in this Plan be reduced by
any compensation earned by such a terminated Participant as the result of
employment by another employer or by retirement benefits paid by the
Participating Company Group or another employer after the Date of Termination
or otherwise.

3.8           Withholding.  Amounts paid to a Participant hereunder shall
be subject to all applicable federal, state and local withholding taxes.

3.9           Waiver
of Any Other Participating Company Retention/Severance Agreement.  A terminated Participant may elect, in his or
her sole discretion, to waive each and every prior retention and/or severance
agreement entered into between a Participating Company and such terminated
Participant in order to participate and receive the Severance Benefits provided
under this Plan. Such waiver shall be in writing in such form as may reasonably
be specified by the Committee and shall be filed with the Company in accordance
with such rules and procedures as may be reasonably established by the
Committee

3.10         Application
of Section 409A.  Notwithstanding any
other provision of this Plan, to the extent the Committee determines in good
faith that (a) one or more of the payments or benefits received or to be
received by a Participant pursuant to the Plan would constitute deferred
compensation subject to the rules of Code Section 409A, and (b) that
the Participant is a “specified employee” under Code Section 409A, then only to
the extent required to avoid the Participant’s incurrence of any additional tax
or interest under Section 409A of the Code, such payment or benefit will be
delayed until the date which is six (6) months after the Participant’s “separation
of service” within the meaning of Code Section 409A.

Section
4.               Limitation
on Payment of Benefits.

4.1           Parachute
Payments.  In the event that it is
determined by the Accounting Firm that any amount payable to a Participant
under this Plan, alone or when aggregated with any other amount payable or
benefit provided to such Participant pursuant to any other plan or arrangement
of the Participating Company Group, would constitute an “excess parachute
payment” within the meaning of Section 280G of the Code, then notwithstanding
the other provisions of this Plan, the amounts payable will not exceed the
amount which produces the greatest after-tax benefit to the Participant.  For purposes of the foregoing, the greatest
after-tax benefit will be determined within thirty (30) days of the occurrence
of such payment to the Participant, in the Participant’s sole and absolute
discretion.  To aid the Participant in
making the determination called for under this Section 4.1, the Company
shall request a determination in writing by the Accounting Firm.  As soon as practicable thereafter, the
Accounting Firm shall determine and report to the Company and the Participant
the amount of such payments and

 9
 

 

benefits
which would produce the greatest after-tax benefit to the Participant.  For the purposes of such determination, the
Accounting Firm may rely on reasonable, good faith interpretations concerning
the application of Sections 280G and 4999 of the Code.  The Company and the Participant shall furnish
to the Accounting Firm such information and documents as the Accounting Firm
may reasonably request in order to make their required determination.  The Company shall bear all fees and expenses
the Accounting Firm may reasonably charge in connection with its services
contemplated by this Section. 
Notwithstanding the time limit above, Participant shall have no less
than ten (10) days following receipt of the Accounting Firm’s report to make
the determination called for by this Section 4.1.

4.2           Non-Duplication
of Benefits.  Notwithstanding any
other provision in the Plan to the contrary, the benefits provided hereunder
shall be in lieu of any other severance plan and/or retention agreement
benefits provided by any Participating Company and the Severance Benefits and
other benefits provided under this Plan shall be reduced by any severance paid
or provided to a Participant by a Participating Company under any other plan or
arrangement.

4.3           Indebtedness
of Participant.  If a Participant is
indebted to the Participating Company Group at his or her Date of Termination,
the Company reserves the right to offset any benefits under this Plan by the
amount of such indebtedness.

Section 5.               Plan
Administration, Amendment and Termination.

5.1           Plan Administrative
Committee.

(a)           Administration by
the Committee.  The Plan shall be
administered by the Committee.

(b)           Committee
Members.  Except as otherwise
provided in Section 5.1(c) below, the Committee shall be composed of those
individuals at the Company who hold the titles of Vice President and General
Counsel, and Vice President Human Resources, or titles functionally equivalent
thereto, and another employee of the Company as shall be appointed by the
Board.  The designation of an individual
as holding such title or position shall constitute automatic appointment to the
Committee and the resignation or other termination of employment or change to a
different position by a Committee member shall constitute automatic resignation
from the Committee.

(c)           Notwithstanding the
foregoing, upon a Change of Control, a majority of the Committee Members shall
be comprised of persons who were members of the Committee prior to the Change
of Control or who are elected to serve as additional Adobe Members as provided
below (the “Adobe Members”).  This shall be accomplished by retaining a
majority of those persons who were Committee Members prior to the Change of
Control, regardless of whether such members’ job titles have changed or they
would otherwise be deemed to have automatically resigned their membership on
the Committee.  In the event that a
majority of the members of the Committee prior to the Change of Control are
unwilling or unable to continue to serve as members of the Committee, the
members of the Committee shall, by majority vote, elect sufficient additional
Adobe Members, so that a majority of the Committee Members are Adobe
Members.  Such additional Adobe Members
shall be persons who were employed by the Company prior to the Change of
Control.

 10
 

 

(d)           The Committee Members
shall not receive compensation for their services on the Committee.  The Participating Company Group shall
indemnify and hold harmless the Committee Members from and against all
liabilities, claims, demands and costs, including reasonable attorneys’ fees
and expenses of legal proceedings, incurred by the Committee which arise as a
result of membership on the Committee.

5.2           Committee
Powers and Responsibilities.  The
Committee shall have all powers necessary to enable it properly to carry out
its duties with respect to the complete control of the administration of the
Plan.  Not in limitation, but in
amplification of the foregoing, the Committee shall have the power and authority
in its discretion to:

(a)           Construe the Plan to
determine all questions that shall arise as to interpretations of the Plan’s
provisions, including determination of which individuals are eligible for
Severance Benefits, the amount of Severance Benefits to which any employee may
be entitled, the determination of which type of Participant any individual is
(i.e., Group I Participant or Group II Participant) and all other matters
pertaining to the Plan;

(b)           Adopt amendments to the
Plan document which are deemed necessary or desirable bring these documents
into compliance with all applicable laws and regulations, including but not
limited to Code Section 409A and the guidance thereunder; and

(c)           Establish procedures
for determining who the Adobe Members of the Committee shall be after a Change
of Control and/or for electing additional Adobe Members of the Committee
pursuant to Section 5.1.  For
purposes of this Section 5.2(c), only those persons who were members of
the Committee prior to the Change of Control shall be authorized to vote.

5.3           Decisions
of the Committee.  Decisions of the
Committee made in good faith upon any matter within the scope of its authority
shall be final, conclusive and binding upon all persons, including Participants
and their legal representatives.  Any
discretion granted to the Committee shall be exercised in accordance with such
rules and policies as may be established by the Committee from time to time.

5.4           Plan
Amendment.  The Plan may be amended
by the Committee as provided by Section 5.2(b) and may also be amended by
resolution of the Board of Directors of the Company (i) for the purposes
specified in Section 5.2(b), (ii) to increase the amount and/or type of
Severance Benefits provided by the Plan, and (iii) to extend the Plan
termination date as provided in Section 5.5. 
Except as otherwise provided in this Section 5.4 the Plan may not be
amended prior to its termination, or, in the event the Plan is extended as
provided in this section 5.4,  the date
on which it would have terminated under Section 5.5 had it not been extended.

5.5           Plan
Termination.  This Plan shall
terminate automatically five (5) years from the
Effective Date unless extended by the Company or unless a Change of Control
shall have occurred prior thereto, in which case the Plan shall terminate following
the later of the date which is at least twenty-four (24) months after the
occurrence of a Change of Control or the payment of all Severance Benefits due
under the Plan.

Section
6.               Claims
for Benefits.  Any person who
believes he or she is entitled to benefits under this Plan may submit a claim
for benefits.  The claim must be in
writing and should state

 11
 

 

the
claimant’s reasons for claiming these benefits. 
The claims should be sent to the Executive Severance Plan Administrative
Committee of Adobe Systems Incorporated. 
If the claim is denied, in whole or in part, written notice of the
denial will be provided within ninety (90) days of initial receipt of the
claim.  Such notice will include an
explanation of the factors on which the denial is based and what, if any,
additional information is needed to support the claim.  Further review of the claim may be obtained
by filing a written request for review. 
An individual whose claim for benefits is denied may file a request for
review with the Committee within sixty (60) days.  After receiving a request for review, the
Committee will render a final decision within sixty (60) days, unless
circumstances require an extension of an additional sixty (60) days for the
review.  In this case, the Committee will
notify the claimant in writing of the need for an extension.  The Committee’s decision will be in writing,
setting forth the specific reasons for the decision, as well as specific
references to the Plan provisions upon which the decision is based.

Section
7.               Legal
Fees and Expenses.  The Company shall
pay or reimburse a Group I Participant for all costs and expenses (including,
without limitation, court costs and reasonable legal fees and expenses which
reflect common practice with respect to the matters involved) incurred by such
Group I Participant as a result of any claim, action or proceeding (a) arising
out of such Group I Participant’s termination of employment during the Term,
(b) contesting, disputing or enforcing any right, benefits or obligations under
this Plan or (c) arising out of or challenging the validity, advisability or
enforceability of this Plan or any provision thereof.  The payments or reimbursements provided for
herein shall be paid by the Participating Company Group promptly (but in no event
more than five (5) business days) following receipt of a written request for
payment or reimbursement, as the case may be.

Section
8.               Miscellaneous.

8.1           No
Contract of Employment.  Nothing in
this Plan shall be construed as giving any Participant any right to be retained
in the employ of the Participating Company Group or shall affect the terms and
conditions of a Participant’s employment with the Participating Company Group
prior to the commencement of the Term.

8.2           ERISA
Plan.  This Plan is intended to be
(a) an employee welfare plan as defined in Section 3(1) of ERISA and (b) a “top-hat”
plan maintained for the benefit of a select group of management or highly
compensated employees of the Participating Company Group.

8.3           Source
of Payments.  All payments provided
under this Plan, other than payments made pursuant to any other Participating
Company Group employee benefit plan which provides otherwise, shall be paid in
cash from the general funds of the Participating Company Group, and no special
or separate fund shall be established, and no other segregation of assets made,
to assure payment.  To the extent that
any person acquires a right to receive payments from the Participating Company
Group hereunder, such right shall be no greater than the right of an unsecured
creditor of the Participating Company Group.

8.4           Notice.  For the purpose of this Plan, notices and all
other communications provided for in this Plan shall be in writing and shall be
deemed to have been duly given when delivered or mailed by overnight courier or
United States registered mail, return receipt requested, postage prepaid,
addressed to the Executive Severance Plan Administrative Committee, Adobe
Systems Incorporated, 345 Park Avenue, San Jose, California 95110-2704,

 12
 

 

with
a copy to the General Counsel of the Company, or to a Participant at the
address set forth in the Participating Company Group’s payroll records or to
such other address as either party may have furnished to the other in writing
in accordance herewith, except that notice of change of address shall be
effective only upon receipt.

8.5           Nonalienation
of Benefits.  No benefit under the
Plan may be assigned, transferred, pledged as security for indebtedness or
otherwise encumbered by any Participant or subject to any legal process for the
payment of any claim against a Participant.

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

8.7           Headings.  The headings contained in this Plan are
intended solely for convenience of reference and shall not affect the rights of
the parties to this Plan.

8.8           Governing
Law.  This Plan shall be governed by
and construed in accordance with the laws of the State of California to the
extent such laws are not preempted by ERISA.

Section
9.               Successors;
Binding Agreement.

9.1           Assumption
by Successor.  The Company will
require any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business or assets of the
Company expressly to assume and to agree to perform the obligations under this
Plan 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; provided, however, that
no such assumption shall relieve the Company of its obligations hereunder.  As used in this Section 9, the “Company”
shall include the Company as defined in Section 1.9 and any successor to its
business and/or assets which assumes and agrees to perform the obligations
arising under this Plan by operation of law or otherwise.

9.2           Enforceability;
Beneficiaries.  This Plan shall be
binding upon and inure to the benefit of each Participant (and such Participant’s
personal representatives and heirs) and the Company and any organization which
succeeds to substantially all of the business or assets of the Company, whether
by means of merger, consolidation, acquisition of all or substantially all of
the assets of the Company or otherwise, including, without limitation, as a
result of a Change of Control or by operation of law.  This Plan shall inure to the benefit of and
be enforceable by each Participant’ personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees.  If a Participant should die
while any amount would still be payable hereunder if such Participant had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Plan to such Participant’s devisee,
legatee or other designee or, if there is no such designee, to such Participant’s
estate.

Section
10.             Release
of Claims.  No Severance Benefits
shall be paid to a Participant under this Plan unless and until the Participant
shall, in consideration of the payment of such Severance Benefits, execute a
release of claims in a form satisfactory to the Committee; provided, however,

 13
 

 

that
such release shall not apply to any right a Participant may have to be
indemnified by the Company.

	
   

  	
   

  	
  Adobe Systems Incorporated

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: September
  25, 2006

  	
  By:

  	
  /s/ Randy Furr

  	
   

  
	
   

  	
   

  	
  Randy Furr

  
	
   

  	
   

  	
  Executive Vice
  President and

  
	
   

  	
   

  	
  Chief Financial
  Officer

  

 

 14

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