Document:

AMENDED AND
RESTATED
CHANGE IN CONTROL
AGREEMENT 

THIS AMENDED AND RESTATED
CHANGE IN CONTROL AGREEMENT (the “Agreement”), dated as of November 20, 2014
(the “Effective Date”) and originally dated as of August 25, 2006, is between
THE CLOROX COMPANY, a Delaware corporation (the “Company”) and Donald Knauss
(the “Executive”). 

The Board of Directors of the
Company (the “Board”) believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened Change in Control and to encourage the
Executive’s full attention and dedication to the Company currently and in the
event of any threatened or pending Change in Control, and to provide the
Executive with compensation and benefits arrangements upon a Change in Control
which ensure that the compensation and benefits expectations of the Executive
will be satisfied and which are competitive with those of other corporations.
Therefore, in order to accomplish these objectives, the Board has caused the
Company to enter into this Agreement. 

NOW, THEREFORE, IT IS AGREED
AS FOLLOWS: 

1. Certain Definitions. 

(a) The “Annual Bonus” shall
mean the annual award the Executive receives in any year under the Company’s
Annual Incentive Plan (“AIP Plan”) and/or the Company’s Executive Incentive
Compensation Plan (“EIC Plan”) or any successors thereto.

(b) The “Average Annual Bonus”
shall mean the average Annual Bonus the Executive received for the three (3)
completed fiscal years immediately preceding the Date of Termination.

(c) The “Bonus Target” shall
mean the Annual Bonus that the Executive would have received in a fiscal year
under the AIP Plan and/or the EIC Plan, if the target goals had been achieved.
If the Executive’s AIP and/or EIC target award changed during the course of the
applicable fiscal year on account of a change in the Executive’s duties and
responsibilities, the Executive’s AIP and/or EIC target award for purposes of
this Agreement shall be calculated based on a weighted average of the
Executive’s specific target awards based on the period of time during which each
was in effect. 

(d) The “Change in Control
Date” shall mean the first date on which a Change in Control (as defined in
Section 2) occurs. Anything in this Agreement to the contrary notwithstanding,
if the Company either terminates the Executive’s employment without Cause or
acts in a manner that provides an Executive with the basis to resign for a Good
Reason, but in either case only if (1) (i) such termination or other act is made
at the request of a third party who has expressed an intent or taken action to
cause a Change in Control to occur and (ii) a Change in Control in fact occurs
on or before the first anniversary of the termination of Executive’s employment
that results in that third party being in control of the ownership of the
Company’s securities or business or being a member of a group that acquires
control of the ownership of the Company’s securities or business, or (2) such
termination or other act occurs either (i) on or before three months prior to
the occurrence of a Change in Control or (ii) with respect to a negotiated
transaction that results in a Change in Control, between the time of the signing
of a definitive agreement with respect to such transaction and the closing of
such transaction, then for all purposes of this Agreement the “Change in Control
Date” shall mean the date immediately prior to the date of such termination of
employment. (e) The “Date of Termination” shall mean (i) if
the Executive’s employment is terminated by the Company for Cause, the date of
receipt of the Notice of Termination for Cause or any later date specified
therein, as the case may be, (ii) if the Executive’s employment is terminated by
the Executive for Good Reason, the 30th day following receipt by the Company of
the Notice of Termination for Good Reason if the Company fails to cure the
problem during the 30-day cure period, or any later date specified in the Notice
of Termination for Good Reason, as the case may be, (iii) if the Executive’s
employment is terminated by the Company other than for Cause or Disability, the
date on which the Company notifies the Executive of such termination, (iv) if
the Executive’s employment is terminated by reason of death or Disability, the
date of death of the Executive or the Disability Effective Date, as the case may
be, and (v) if the Executive’s employment is terminated by Executive without
Good Reason (and not due to Disability), the date of receipt of the Notice of
Termination or any later date specified therein, as the case may be. 

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(f) “Disability” shall mean
that the Executive (i) is unable to engage in any substantial gainful activity
by reason of any medically determinable physical or mental impairment that can
be expected to result in death or can be expected to last for a continuous
period of not less than 12 months, or (ii) is receiving income replacement
benefits for a period of not less than three (3) months under the Company’s
accident and health plans by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months.

(g) The “Separation Period”
shall mean the period from the Date of Termination through the third anniversary
of the Date of Termination.

2. Change in Control.
For the purpose of this Agreement, a “Change in Control” shall mean:

(a) The acquisition by any
individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a
“Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of (i) 50% of either the total fair market value or the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”), or (ii) during a 12 month period ending on the date
of the most recent acquisition by such Person, 30% of the Outstanding Company
Voting Securities; provided, however, that for purposes of this subsection (a),
the following acquisitions shall not constitute a Change in Control: (i) any
acquisition directly from the Company, (ii) any acquisition by the Company,
including any acquisition which by reducing the number of shares outstanding, is
the sole cause for increasing the percentage of shares beneficially owned by any
such Person to more than the applicable percentage set forth above, (iii) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (iv)
any acquisition by any corporation pursuant to a transaction which complies with
clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or 

(b) Individuals who, as of the
date hereof, constitute the Board (the “Incumbent Board”) cease for any reason
within any period of 12 months to constitute at least a majority of the Board;
provided, however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board, shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or 

(c) Consummation by the
Company of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company or the
acquisition of assets of another corporation (a “Business Combination”), in each
case, unless, following such Business Combination, (i) more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries) is represented by Outstanding Company Common Stock and Outstanding
Company Voting Securities, respectively, that were outstanding immediately prior
to such Business Combination (or, if applicable, is represented by shares into
which such Outstanding Company Common Stock and Outstanding Company Voting
Securities were converted pursuant to such Business Combination) and such
ownership of common stock and voting power among the holders thereof is in
substantially the same proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Company Common Stock and Outstanding
Company Voting Securities, as the case may be, (ii) no Person (excluding any
employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination. 

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Notwithstanding any other
provision in this Section 2, any transaction defined in Section 2(a) through (c)
above that does not constitute a “change in the ownership or effective control”
of the Company, or “change in the ownership of a substantial portion of the
assets” of the Company within the meaning of Treasury Regulations 1.409A-3(a)(5) and 1.409A-3(i)(5) shall not be treated as a Change in
Control.

3. Severance Protection Period. 

(a) This Agreement became
effective on the Effective Date. After the Effective Date, this Agreement may be
amended, modified, suspended or terminated at any time by the Company; provided,
however, that no such action may become effective for one (1) year following the
date of such action without the prior written consent of Executive (or his legal
representative). The terms of this Agreement shall remain in effect until either
(i) the time that the Executive is no longer employed by the Company, if the
Severance Protection Period has not commenced for the Executive in the interim,
or (ii) if the Severance Protection Period has commenced at or before the time
that the Executive is no longer employed by the Company, the date as of which
all of the duties and obligations of the parties have been satisfied under this
Agreement. The terms and conditions of the Executive’s employment shall be as
set forth in the Amended and Restated Employment Agreement between the Executive
and the Company dated of November 20, 2014, as it may be amended from time to
time (the “Current Agreement”) during the term thereof. From and after the
Effective Date, this Agreement shall supersede the Current Agreement and any
other agreement between the parties, but only with respect to the specific
matter described further in Section 3(b) below. 

(b) This Agreement addresses
the terms and conditions under which Executive shall be entitled to severance
benefits in connection with certain separations from service with the Company
for the period commencing on the Change in Control Date and ending on the second
anniversary of the later of (i) the Change in Control Date or (ii) the date of
on which a Change in Control occurs (the “Severance Protection
Period”).

4. Termination of Employment. 

(a) Cause. The Company may terminate the Executive’s employment during the
Severance Protection Period with or without Cause. For purposes of this
Agreement, “Cause” shall mean: 

(i) the willful and continued
failure of the Executive to perform substantially the Executive’s duties with
the Company or one of its affiliates (other than any such failure resulting from
incapacity due to physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Board which
specifically identifies the manner in which the Board believes that the
Executive has not substantially performed the Executive’s duties, or

(ii) the willful engaging by
the Executive in illegal conduct or gross misconduct which is materially and
demonstrably injurious to the Company. 

For purposes of this
provision, no act or failure to act, on the part of the Executive, shall be
considered “willful” unless it is done, or omitted to be done, by the Executive
in bad faith or without reasonable belief that the Executive’s action or
omission was in the best interests of the Company. Any act, or failure to act,
based upon authority given pursuant to a resolution duly adopted by the Board or
based upon the advice of counsel for the Company shall be conclusively presumed
to be done, or omitted to be done, by the Executive in good faith and in the
best interests of the Company. The cessation of employment of the Executive
shall not be deemed to be for Cause unless and until there shall have been
delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters of the entire membership of the
Board at a meeting of the Board called and held for such purpose (after
reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the Board), finding that,
in the good faith opinion of the Board, the Executive is guilty of the conduct
described in subparagraph (i) or (ii) above, and specifying the particulars
thereof in detail. 

(b) Good Reason. Executive may terminate his employment with the Company during the
Severance Protection Period with or without Good Reason. The Executive’s
employment may be terminated by the Executive for Good Reason provided the
Executive delivers the written notice to the Company set forth in Section 4(c)
and the Company fails to cure the issue. For purposes of this Agreement, “Good
Reason” shall mean: 

(i) the assignment to the
Executive of any duties inconsistent in any material respect with the
Executive’s position (including
offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section
2(a) of the Current Agreement, or any other action by the Company which results
in a material diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive; 

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(ii) any failure by the
Company to comply with any of the material provisions of Executive’s
compensation plans, programs, agreements or arrangements as in effect
immediately prior to the Change in Control, which material provisions shall
consist of base salary, cash incentive compensation target bonus opportunity,
equity compensation opportunity in the aggregate, savings and retirement
benefits in the aggregate, and welfare benefits (including medical, dental,
life, disability and severance benefits) in the aggregate, other than an
isolated, insubstantial and inadvertent failure not occurring in bad faith and
which is remedied by the Company promptly after receipt of notice thereof given
by the Executive; 

(iii) the Company’s requiring
the Executive to be based at any office or location requiring the Executive’s commute to increase by more than 50
miles from his commute immediately prior to the Change in Control; 

(iv) any purported termination
by the Company of the Executive’s employment otherwise than as expressly
permitted by this Agreement; or 

(v) any material failure by
the Company to comply with and satisfy Section 10(c) of this Agreement.

Notwithstanding the above, a
failure by the Company’s stockholders to elect the Executive to the Board shall
not constitute Good Reason, but a failure by the Board to nominate the Executive
to the Board at any time shall constitute Good Reason. 

(c) Notice of Termination. 

(i) Any termination by the
Company for Cause shall be communicated by Notice of Termination for Cause to
the Executive given in accordance with Section 11(b) of this Agreement. For
purposes of this Agreement, a “Notice of Termination for Cause” means a written
notice which (X) indicates the specific termination provision in this Agreement
relied upon, (Y) to the extent applicable, sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive’s employment under the provision so indicated and (Z) if the Date of
Termination is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than thirty days after the giving
of such notice). The failure by the Company to set forth in the Notice of
Termination for Cause any fact or circumstance which contributes to a showing of
Cause shall not waive any right of the Company hereunder or preclude the Company
from asserting such fact or circumstance in enforcing the Company’s rights
hereunder. 

(ii) Any termination by the
Executive for Good Reason shall be communicated by Notice of Termination for Good Reason to
the Company within a period not to exceed 90 days of the initial existence of
the condition and given in accordance with Section 11(b) of this Agreement. For
purposes of this Agreement, a “Notice of Termination for Good Reason” means a
written notice which (X) indicates the specific termination provision in this
Agreement relied upon, (Y) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive’s employment under the provision so indicated and (Z) the
Executive’s intended Date of Termination if the Company does not cure the issue
(which date shall be not less than thirty days after the giving of such notice).
After receipt by the Company of the Notice of Termination for Good Reason, the
Company shall have at least 30 days during which it may remedy the condition and
thereby cure the event or circumstance constituting “Good Reason”. 

5. Obligations of the Company upon
Termination. 

(a) By the Executive for Good Reason; or by the
Company Other Than for Cause, Death or Disability. Subject to Section 5(c), if, during the
Severance Protection Period, the Company shall terminate the Executive’s
employment other than for Cause, death or Disability or the Executive shall
terminate employment for Good Reason: 

(i) the Company shall pay, or
cause to have paid or provided, to the Executive the aggregate of the following
amounts: A. the sum of (1) the Executive’s Annual Base Salary through the Date
of Termination to the extent not theretofore paid, (2) any accrued but unused
vacation pay, (3) reimbursement of any unpaid business expenses in accordance with the Company’s policy on business
expense reimbursement and (4) all unpaid accrued and vested benefits under all
pension, savings and other retirement benefit and deferred compensation plans
and all welfare benefit plans in which the Executive participated prior to such
termination (the sum of the amounts described in clauses (1), (2), (3) and (4)
shall be hereinafter referred to as the “Accrued Obligations”). The amounts
described in clauses (1), (2) and (3) above shall be paid in a lump sum in cash
within 30 days after the Date of Termination and the benefits described in
clause (4) above shall be provided in accordance with the terms of the
applicable plans. 

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B. an amount equal to the
following: 

	          	Average Annual	       X       	# of
      days in the current fiscal year	
	 	Bonus	 	through the Date
      of Termination	
	 			365	

provided, however, that, the
Company shall pay the Executive a retirement bonus in accordance with the terms
of the Company's AIP Plan, EIC Plan or any other plan adopted by the Company or
pay the amount calculated in accordance with this Section 5(a)(i)(B), whichever
is greater, but it shall not be obligated to pay both; and 

C. the amount equal to the
following: 

3     X       (Annual Base Salary +
Average Annual Bonus); and 

D. an amount equal to the
difference between (a) the actuarial equivalent of the aggregate benefits under
the Company’s qualified pension and profit-sharing plans (the “Retirement
Plans”) and any excess or supplemental pension and profit-sharing plans in which
the Executive participates (collectively, the “Nonqualified Plans”),
specifically including the Company SERP, which the Executive would have been
entitled to receive if the Executive’s employment had continued for the
Separation Period, assuming (to the extent relevant) that the Executive’s
compensation during the Separation Period would have been equal to the
Executive’s compensation as in effect immediately before the termination or, if
higher, on the Change in Control Date, and that employer contributions to the
Executive’s accounts in the Retirement Plans and the Nonqualified Plans during
the Separation Period would have been equal to the average of such contributions
for the three years immediately preceding the Date of Termination or, if higher,
the three years immediately preceding the Change in Control Date, and (b) the
actuarial equivalent of the Executive’s actual aggregate benefits (paid or
payable), if any, under the Retirement Plans and the Nonqualified Plans as of
the Date of Termination (the actuarial assumptions used for purposes of
determining actuarial equivalence shall be no less favorable to the Executive
than the most favorable of those in effect under the Retirement Plan and the
Nonqualified Plans on the Date of Termination and the date of the Change in
Control); 

(ii) For the Separation
Period, the Company shall 

A. if the Executive
participated in a Company self-insured medical plan (which does not satisfy the
requirements of Section 105(h)(2)) immediately prior to the Date of Termination,
pay to the Executive or cause to have paid on the Executive’s behalf the
Company’s portion of the premium payable under the Company’s group health plans
for providing health benefits (i.e., medical, dental and vision benefits) to the
Executive and to those family members covered through Executive under the
Company’s group health plans at the time of the commencement of the Separation
Period, such coverage to be provided under the group health plans in which
Executive and his covered family members are participating at the time of the
commencement of the Separation Period or elect in accordance with the Company’s
applicable established procedures (reduced by any amounts which Executive is
required to pay for such health benefit coverage as described in further detail
below). The Company shall pay or cause to have paid all amounts due under this
Section 5(a)(ii) in annual installments, with the first installment due or
credited within 30 days after the Date of Termination and subsequent
installments being made or credited on the anniversary thereof; provided,
however, that subsequent installments may be reduced or eliminated to the extent
that Executive becomes eligible for other health coverage through a subsequent
employer; or 

B. if paragraph A above is not
applicable (because the Executive participated in a health benefit program to
which Section 105(h) is not applicable, such as the Company’s HMO immediately
prior to the Date of Termination), continue benefits under such health plan on
the same basis as an employee of the Company, so long as such continued coverage
does not violate the Patient Protection and Affordable Care Act of 2010.

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The purpose of providing the
benefits pursuant to this Section 5(a)(ii) shall be to provide the Executive
and/or the Executive’s covered family members with continued health benefits at
least equal to those which would have been provided to them in accordance with
the Company’s health plans, programs, practices and policies if the Executive’s
employment had not been terminated or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other peer executives of
the Company and its affiliated companies and their families (in each case with
such contributions by the Executive as would have been required had the
Executive’s employment not been terminated); provided, however, that each
continued benefit under a health plan sponsored by the Company described herein
shall cease upon the earliest of: (i) three years from the Date of Termination;
(ii) the Executive’s 65th birthday; or (iii) the Executive’s eligibility for the
same type of health benefit (i.e., medical, dental or vision coverage) under a
subsequent employer’s group health plans. For purposes of determining
eligibility (but not the time of commencement of benefits) of the Executive for
retiree benefits pursuant to such plans, practices, programs and policies of the
Company, the Executive shall be considered to have remained employed during the
Separation Period and to have retired on the last day of such period. The
Separation Period shall not be subtracted from the period of months for which
the Executive is eligible for benefits under the Consolidated Omnibus Budget
Reconciliation Act of 1985; 

(iii) if the Executive was
entitled to receive financial planning and/or tax return preparation benefits
immediately before the Date of Termination, the Company shall continue to
provide the Executive with such financial planning and/or tax return preparation
benefits with respect to the calendar year in which the Date of Termination
occurs (including without limitation the preparation of income tax returns for
that year), on the same terms and conditions as were in effect immediately
before the Date of Termination (disregarding for all purposes of this clause
(iii) any reduction or elimination of such benefits that was the basis of a
termination of employment by the Executive for Good Reason); and

(iv) all awards granted to the
Executive prior to the Change in Control under the Company’s 2005 Stock
Incentive Plan or any successor plan thereto will become immediately fully
vested and any such awards constituting stock options will be immediately fully
exercisable in the event that the Executive’s termination occurs during the
Severance Protection Period.

To the extent any benefits
described in Section 5(a)(ii) and (iii) cannot be provided pursuant to the
appropriate plan or program maintained for employees, the Company shall provide
such benefits outside such plan or program at no additional cost (including
without limitation tax cost) to the Executive. 

(b) Cause; Other than for Good Reason. If the Executive’s employment shall be
terminated for Cause, or on account of death or Disability, during the Severance
Protection Period, this Agreement shall terminate without further obligations to
the Executive other than the obligation to pay to the Executive all Accrued
Obligations to the extent theretofore unpaid. If the Executive voluntarily
terminates employment during the Severance Protection Period, excluding a
termination for Good Reason, this Agreement shall terminate without further
obligations to the Executive, other than for the payment of all Accrued
Obligations to the extent theretofore unpaid. In such case, all Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination or as otherwise provided in the applicable benefit
plan as the case may be. 

(c) Specified Employee. Notwithstanding the foregoing, if the Executive
is a Specified Employee (as defined in Section 1.409A-1(i) of the Treasury
Department Regulations) on the Date of Termination and all payments subject to
Section 409A of the Internal Revenue Code (the “Code”) specified in Section 5(a)
are not made by March 15 of the year immediately following the Date of
Termination, the following shall apply: Such payments may be made to the extent
that the amount does not exceed two times the lesser of (i) the sum of the
Executive’s annualized compensation based upon the annual rate of pay for
services provided to the Company for the taxable year preceding the termination,
or (ii) the maximum amount that may be taken into account pursuant to Section
401(a)(17) of the Code ($260,000 in 2014) for the year in which the Executive
has terminated. Any amounts exceeding such limit, may not be made before the
earlier of the date which is six (6) months after the Date of Termination or the
date of death of the Executive. Furthermore, any payments pursuant to this
Section 5 shall be postponed until six (6) months following the end of the
consulting period so long as the Executive continues to work on a consulting
basis for the Company following termination and such consulting requires the
Executive to work more than 20% of his average hours worked during the 36 months
preceding his termination. Any payments that were scheduled to be paid during
the six (6) month period following the Executive’s Date of Termination, but
which were delayed pursuant to this Section 5(c), shall be paid without interest
on, or as soon as administratively practicable after, the first day following
the six (6) month anniversary of the Executive’s Date of Termination (or, if
earlier, the date of Executive’s death). Any
payments that were originally scheduled to be paid following the six (6) months
after the Executive’s Date of Termination, shall continue to be paid in
accordance to their predetermined schedule.

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(d) Release. The Executive shall have 21 days following termination (or such longer
period as may be required by law, but in no event greater than 60 days following
termination) in which to execute a General Release (“Release”) in a form
substantially equivalent to the attached Exhibit (which may be amended by the
Company, from time to time, to conform to applicable law) and seven days in
which to revoke the Release after its execution. If the Executive does not
execute, or having executed, effectively revokes the Release, the Company will
not be obligated to provide any benefits or payments of any kind to the
Executive. If the condition of providing a release by the Executive could cause
the payment of any amount or provision of any benefit subject to such release to
be paid or provided in either of two taxable years of the Executive, such amount
or benefit shall be paid or provided in the later such taxable year. 

6. Non-exclusivity of Rights.
Nothing in this Agreement shall prevent or limit the Executive’s continuing or
future participation in any plan, program, policy or practice provided by the
Company or any of its affiliated companies and for which the Executive may
qualify by the express terms of such plan, program or policy, nor shall anything
herein limit or otherwise affect such rights as the Executive may have under any
contract or agreement with the Company or any of its affiliated companies.
Amounts which are vested benefits or which the Executive is otherwise entitled
to receive under any plan, policy, practice or program of or any contract or
agreement with the Company or any of its affiliated companies at or subsequent
to the Date of Termination shall be payable in accordance with such plan,
policy, practice or program or contract or agreement except as explicitly
modified by this Agreement. 

7. Full Settlement.
The Company’s obligation to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action which
the Company may have against the Executive or others. 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 specifically provided in Section
5(a)(ii), such amounts shall not be reduced whether or not the Executive obtains
other employment. 

8. Parachute Limitation.

(a) Notwithstanding any other
provision of this Agreement, in the event that any amount or benefit that may be
paid or otherwise provided to or in respect of the Executive by or on behalf of
the Company or any affiliate, whether pursuant to this Agreement or otherwise
(collectively, “Covered Payments”), is or may become subject to the tax imposed
under Section 4999 of the Code (or any successor provision or any comparable
provision of state, local or foreign law) (“Excise Tax”), then the portion of
the Covered Payments that would be treated as “excess parachute payments” under
Code Section 280G (“Covered Parachute Payments”) shall be reduced so that no
amount of the Covered Parachute Payments, in the aggregate, are subject to the
Excise Tax, if and only if, taking into account all applicable federal, state,
local and foreign income and employment taxes, the Excise Tax, and any other
applicable taxes, results in the receipt by the Executive, on an after-tax
basis, of a greater amount of Covered Payments than if not so reduced. In the
event that it is determined that the amount of any Covered Payments will be
reduced in accordance with this Section 8(a), the same independent tax
professional experienced in the completion of the calculations described in this
Section 8 (“Tax Professional”) making the determinations described in Section
8(b) below shall designate which of the Covered Payments shall be reduced and to
what extent in a manner that maximizes the Executive’s economic benefit of the
Covered Payments. In the event that it is determined that a reduction of the
Covered Payments would not result in a greater after-tax amount of benefits
under this Agreement to the Executive, then no reduction shall be made under
this Section 8(a).

(b) The determination of (i)
whether an event described in Section 280G(b)(2)(A)(i) of the Code has occurred,
(ii) the value of any Covered Parachute Payments, (iii) whether any reduction in
the Covered Payments is required under Section 8(a), and (iv) the amount of any
such reduction, shall be made initially by the Tax Professional. The Tax
Professional shall be selected by the Executive, or if the Executive fails to
select a Tax Professional within thirty (30) days following the Date of
Termination, by the Committee (as constituted prior to the occurrence of any
Change in Control). For purposes of making the calculations required by this
Section 8, the Tax Professional may make reasonable assumptions and
approximations concerning applicable taxes and may rely on reasonable, good
faith interpretations concerning the application of the Code, and other
applicable legal authority. The Company and the Executive shall furnish to the Tax Professional such information and
documents as the Tax Professional may reasonably request in order to make a
determination under this Section 8. The Company shall bear and be solely
responsible for all costs the Tax Professional may reasonably incur in
connection with any calculations contemplated by this Section 8.

7

(c) If, notwithstanding any
reduction described in Section 8(a), the IRS determines that the Executive is
liable for the Excise Tax as a result of the receipt of any Covered Payments,
then the Executive shall be obligated to pay back to the Company, within thirty
(30) days after a final IRS determination or in the event that the Executive
challenges the final IRS determination, a final judicial determination, a
portion of the Covered Payments equal to the “Repayment Amount.” The Repayment
Amount shall be the smallest such amount, if any, as shall be required to be
paid to the Company so that the Executive’s net after-tax proceeds with respect
to the Covered Payments (after taking into account the payment of the Excise Tax
and all other applicable taxes imposed on such benefits) shall be maximized. The
Repayment Amount shall be zero if a Repayment Amount of more than zero would not
result in the Executive’s net after-tax proceeds with respect to the Covered
Payments being maximized. If the Excise Tax is not eliminated pursuant to this
Section 8(c), the Executive shall pay the Excise Tax.

(d) Notwithstanding any other
provision of this Section 8, if (i) there is a reduction in the payments to the
Executive as described in this Section 8, (ii) the IRS later determines that the
Executive is liable for the Excise Tax, the payment of which would result in the
maximization of the Executive’s net after-tax proceeds (calculated as if the
Executive’s benefits had not previously been reduced), and (iii) the Executive
pays the Excise Tax, then the Company shall pay to the Executive those payments
which were reduced pursuant to this Section 8 as soon as administratively
possible after the Executive pays the Excise Tax (but not later than 30 days
after notice by the Executive to the Company thereof) so that the Executive’s
net after-tax proceeds with respect to the payment of the Covered Payments are
maximized.

9. Post Termination
Obligations. 

(a) Proprietary Information Defined. “Proprietary Information” is all information and
any idea in whatever form, tangible or intangible, pertaining in any manner to
the business of the Company or any of its affiliated companies, or to its
clients, consultants, or business associates, unless: (i) the information is or
becomes publicly known through lawful means; (ii) the information was rightfully
in the Executive’s possession or part of his general knowledge prior to his
employment by the Company; or (iii) the information is disclosed to the
Executive without confidential or proprietary restriction by a third party who
rightfully possesses the information (without confidential or proprietary
restriction) and did not learn of it, directly or indirectly, from the Company.

(b) General Restrictions on Use of Proprietary
Information. The Executive agrees
to hold all Proprietary Information in strict confidence and trust for the sole
benefit of the Company and not to, directly or indirectly, disclose, use, copy,
publish, summarize, or remove from Company’s premises any Proprietary
Information (or remove from the premises any other property of the Company),
except (i) during his employment to the extent necessary to carry out the
Executive’s responsibilities under this Agreement, (ii) after termination of his
employment as specifically authorized in writing by the Board, and (iii)
pursuant to a subpoena. 

(c) Non-Solicitation and Non-Raiding. To forestall the disclosure or use of
Proprietary Information in breach of Section 9(b), and in consideration of this
Agreement, Executive agrees that for a period of two (2) years after termination
of his employment, he shall not, for himself or any third party, directly or
indirectly (i) divert or attempt to divert from the Company (or any of its
affiliated companies) any business of any kind in which it is engaged,
including, without limitation, the solicitation of its customers as to products
which are directly competitive with products sold by the Company at the time of
the Executive’s termination, or interference with any of its suppliers or
customers, or (ii) solicit for employment any person employed by the Company, or
by any of its affiliated companies, during the period of such person’s
employment and for a period of three months after the voluntary termination of
such person’s employment with the Company. 

(d) Contacts with the Press. Following termination, the Executive will
continue to abide by the Company’s policy that prohibits discussing any aspect
of Company business with representatives of the press without first obtaining
the permission of the Company’s Public Relations Department. 

8

(e) Non-Disparagement. The Executive agrees that he will not do or say
anything that could reasonably be expected to disparage or impact negatively the
name or reputation in the marketplace of the Company or any of its
employees, officers, directors, stockholders, members, principals or
assigns. Nothing herein shall preclude the Executive from complying with
applicable disclosure requirements, responding truthfully to any legal process
or truthfully testifying in a legal or regulatory proceeding, provided that, to
the extent permitted by law, the Executive promptly informs the Company of any
such obligation prior to participating in any such proceedings. The Company
likewise agrees that it will not release any information or make any statements,
and its officers, directors and other representatives who may reasonably be
viewed as speaking on its behalf shall not do or say anything that could
reasonably be expected to disparage or impact negatively the name or reputation
in the marketplace of the Executive. Nothing herein shall preclude the Company
from complying with applicable disclosure requirements, responding truthfully to
any legal process or truthfully testifying in a legal or regulatory proceeding,
provided that to the extent permitted by law, the Company will promptly inform
the Executive in advance if they have reason to believe such response or
testimony will directly relate to the Executive. 

(f) Remedies. Nothing in this Section 9 is intended to limit any remedy of the Company
under the California Uniform Trade Secrets Act (California Civil Code Section
3426), or otherwise available under law. Furthermore, the Executive and the
Company agree that the covenants contained in this Section 9 are reasonable and
enforceable under the circumstances, and further agree that if in the opinion of
any court of competent jurisdiction any such covenant is not enforceable in any
respect, such court will have the right, power and authority to sever or modify
any provision or provisions of such covenants as to the court appear
unenforceable and to enforce the remainder of the covenants as so amended. The
Executive also acknowledges and agrees that the remedy at law available to the
Company for breach of any of the Executive’s obligations under this Section 9
would be inadequate, and that damages flowing from such a breach may not readily
be susceptible to being measured in monetary terms, so therefore the Executive
acknowledges, consents and agrees that, in addition to any other rights and
remedies that the Company may have at law, in equity or under this Agreement
(subject to the limitation set forth in Section 9(g) below), upon adequate proof
of the Executive’s violation of any such provision of this Section 9, the
Company will be entitled to immediate injunctive relief and may obtain a
temporary order restraining any threatened or further breach, without the
necessity of proof of actual damage or posting of any bond. The provisions of
this Section 9(f) shall apply with like force against the Company with respect
to any remedy available to the Executive for enforcement of Section
9(e). 

(g) No Deferral or Withholding by the
Company. In no event shall an
asserted violation of the provisions of this Section 9 constitute a basis for
deferring or withholding any amounts otherwise payable to the Executive pursuant
to this Agreement. 

10. 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 otherwise than by will or the laws of descent and
distribution. The rights of Executive under 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 will require
any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to 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. As used in this Agreement, “Company”
shall mean the Company as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise. 

11. Miscellaneous. 

(a) This Agreement shall be
governed by and construed in accordance with the laws of the State of
California, without reference to principles of conflict of laws. The captions of
this Agreement are not part of the provisions hereof and shall have no force or
effect. 

9

(b) All notices or other
communications required or permitted hereunder shall be made in writing. Notice
shall be effective on the date of delivery if delivered by hand upon receipt or
if delivered by use of the recipient’s Company e-mail address upon receipt, on
the first business day following the date of dispatch if delivered utilizing
next day service by a recognized next day courier to the applicable address set
forth below, or if mailed, three (3) business days after having been mailed,
postage prepaid, by certified or registered mail, return receipt requested, and
addressed to the applicable address set forth below. Notice given by facsimile
shall be effective upon written confirmation of receipt of the facsimile.

If to the
Executive: 

To the residence address for
the Executive last shown on the Company’s payroll records. 

	               	If to the Company:
	 	 
	 	The
      Clorox Company
	 	1221
      Broadway
	 	Oakland, California 94612
	 	Attention: General Counsel
	 	Fax: [	           	]

or to such other address as
either party shall have furnished to the other in writing in accordance
herewith. 

(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 Federal, state, local or
foreign taxes as shall be required to be withheld pursuant to any applicable law
or regulation. 

(e) This Agreement may not be
modified or amended in a manner adverse to the interests of the Executive except
as provided in Section 3(a) above, or with respect to the Executive, by an
instrument in writing signed by the Executive consenting to such modification or
amendment. By an instrument in writing similarly executed, either party may
waive compliance by the other party with any provision of this Agreement that
such other party was or is obligated to comply with or perform, provided,
however, that such waiver shall not operate as a waiver of, or estoppel with
respect to, any other or subsequent failure. No failure to exercise and no delay
in exercising any right, remedy, or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, or power
hereunder preclude any other or further exercise thereof or the exercise of any
other right, remedy, or power provided herein or by law or in equity.

(f) Except as provided in
Section 6 above, the terms of this Agreement are intended by the parties to be
the final expression of their agreement regarding the provision of benefits to
be paid by the Company to Executive in connection with certain types of
termination of employment in connection with the occurrence of a Change in
Control. Except as permitted in Section 6 above, the terms of this Agreement may
not be contradicted by evidence of any prior or contemporaneous agreement and no
extrinsic evidence whatsoever may be introduced in any judicial, administrative,
or other legal proceeding involving the Agreement. 

(g) In the event of any
inconsistency between (a) this Agreement and (b) any other plan, program,
practice or agreement in which the Executive participates or is a party, this
Agreement shall control. 

12. Executive Acknowledgment.
The Executive acknowledges (a) that he has consulted with or has had the
opportunity to consult with independent counsel of his own choice concerning
this Agreement and has been advised to do so by the Company, and (b) that he has
read and understands the Agreement, is fully aware of its legal effect, and has
entered into it freely based on his own judgment. 

13. Survival.
The Executive’s rights under Sections 5, 8, 14, 16 and this Section 13 shall
survive any termination of the Executive’s employment and the term of this
Agreement. 

10

14. Arbitration and Injunctive Relief.

(a) Any controversy between
the Executive or the Executive’s heirs or estate and the Company or any employee
of the Company, including but not limited to, those involving the construction
or application of any of the terms, provisions or conditions of
this Agreement or otherwise arising out of or related to this Agreement, shall
be settled by arbitration before a single arbitrator in accordance with the then
current commercial arbitration rules of the American Arbitration
Association, and judgment on the
award rendered by the arbitrator may be entered by any court having jurisdiction
thereof. The location of the arbitration shall be San Francisco, California if
the Executive’s current or most recent location of employment with the Company
is or was located in Alameda County, California. If it is or was elsewhere, the
arbitration shall be held at the city nearest to the Executive’s last location
of employment with the Company which has an office of the American Arbitration
Association. The arbitrator shall award attorney’s fees to the Executive to the
extent that the Executive prevails in the arbitration
proceeding.

(b) Notwithstanding the other
provisions of this Section 14 or any other provision of this Agreement to the
contrary, no claim or controversy for injunctive or equitable relief
contemplated by or allowed under applicable law pursuant to Section 9 of this
Agreement will be subject to arbitration under this Section 14, but will instead
be subject to determination in a court of competent jurisdiction in the State of
California, County of Alameda, which court shall apply California law without
reference to the conflict of laws provisions thereof. 

15. Section 409A.
To the extent applicable, it is intended that this Agreement and any payment
made hereunder shall comply with the requirements of Section 409A of the Code,
and any related regulations or other guidance promulgated with respect to such
Section by the U.S. Department of the Treasury or the Internal Revenue Service
(“Section 409A”). Any provision that would cause the Agreement or any payment
hereof to fail to satisfy Section 409A shall have no force or effect until
amended to the minimum extent required to comply with Section 409A, which
amendment may be retroactive to the extent permitted by Section 409A.

16. Indemnification.
The Company agrees to indemnify the Executive and hold him harmless to the
fullest extent permitted by the Company’s certificate of incorporation, bylaws
and applicable law against and in respect to any and all actions, suits,
proceedings, claims, demands, judgments, costs, expenses, losses, and damages
resulting from the Executive’s good faith performance of his duties and
obligations with the Company. The Company shall insure the Executive under any
contract of directors and officers liability insurance, insuring members of the
Board, during his employment and tenure as a Board member and thereafter for so
long as he may be subject to liability for such acts or omissions in the
performance of his duties and obligations to the Company. 

17. Counterparts.
This Agreement may be executed in several counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same instruments. One or more counterparts of this Agreement may be delivered by
facsimile, with the intention that delivery by such means shall have the same
effect as delivery of an original counterpart thereof. 

18. Severability.
If any one or more of the provisions contained in this Agreement, or any
application thereof, shall be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein and all other applications thereof shall not in any way be affected or
impaired thereby. This Agreement shall be construed and enforced as if such
invalid, illegal or unenforceable provision has never comprised a part hereof,
and the remaining provisions hereof shall remain in full force and effect and
shall not be affected by the invalid, illegal or unenforceable provision or by
its severance herefrom. In lieu of such invalid, illegal or unenforceable
provisions there shall be added automatically as a part hereof a provision as
similar in terms and economic effect to such invalid, illegal or unenforceable
provision as may be possible and be valid, legal and enforceable. 

11

The parties have duly executed
this Agreement as of the Effective Date that appears at the beginning of this
Agreement. 

	THE
      CLOROX COMPANY	       	EXECUTIVE
	The
      Company		
	 
	By:	/s/ Robert W. Matschullat		/s/ Donald R. Knauss
	Name:  	Robert W. Matschullat	 	Donald R. Knauss
	Title: 	Lead Director, The Clorox Board of
      Directors	 	Executive Chairman, The Clorox Board of
      Directors

12

EXHIBIT 

EXHIBIT
GENERAL RELEASE 

This document is an important one.
You should review it carefully and, if you agree to it, sign at the end on the
line indicated. 

You have 21 days to sign this
Release, during which time you are advised to consult with an attorney regarding
its terms. 

After signing this Release, you
have seven days to revoke it. Revocation should be made in writing and delivered
so that it is received by the Corporate Secretary of The Clorox Company, 1221
Broadway, Oakland, CA 94612 no later than 4:30 p.m. Pacific time on the seventh
day after signing this Release. If you do revoke this Release within that time
frame, you will have no rights under it. This Release shall not become effective
or enforceable until the seven day revocation period has expired.

The agreement for payment of
consideration in paragraph 2 will not become effective until the seven day
revocation period has passed. 

This GENERAL RELEASE is entered into
between The Clorox Company (hereinafter referred to as “Employer”) and Donald R.
Knauss (hereinafter referred to as “Executive”). Defined terms used in this
General Release not defined herein shall have the meaning set forth in the
Agreement (as defined below). Employer and Executive agree as set forth herein,
including as follows: 

1. Executive’s regular employment
with Employer will terminate as of _________________, 20_. Executive is ineligible for
reemployment or reinstatement with Employer.

2. Upon Executive’s acceptance of the
terms set forth herein, the Employer agrees to provide the Executive with
compensation and benefits set forth in Section 5 of the Change in Control
Severance Agreement (the “Agreement”), which compensation and benefits shall be
provided subject to the terms and conditions of the
Agreement, a copy of which is attached to this General Release.

13

3. (a) In consideration of the
Employer providing Executive this compensation, Executive and Executive’s heirs,
assignees and agents agree to release the Employer, all affiliated companies,
agents and employees and each of their successors and assigns (hereinafter
referred to as “Releasees”) fully and finally from any claims, liabilities,
demands or causes of action which Executive may have or claim to have against
the Releasees at present or in the future, except for the following: (i) claims
for vested benefits under the terms of an employee compensation or benefit plan,
program or arrangement sponsored by the Company, (ii) claims for workers’
compensation benefits under any of the Company’s workers’ compensation insurance
policies or funds, (iii) claims related to Executive’s COBRA rights, and (iv)
claims for indemnification to which Executive is or may become entitled,
including but not limited to claims submitted to an insurance company providing
the Company with directors and officers liability insurance. The claims released
may include, but are not limited to, any tax obligations as a result of the
payment of consideration referred to in paragraph 2, and claims arising under
federal, state or local laws prohibiting discrimination in employment, including
the Age Discrimination in Employment Act (ADEA) or claims growing out of any
legal restrictions on the Employer’s right to terminate its employees. Claims of
discrimination, wrongful termination, age discrimination, and any claims other
than for vested benefits are hereby released.

(b) By signing this document,
Executive agrees not to file a lawsuit to assert such claims. Executive also
agrees that if Executive breaches this provision, Executive will be liable for
all costs and attorneys’ fees incurred by any Releasee resulting from such
action. 

14

4. By signing this document,
Executive is also expressly waiving the provisions of California Civil Code section 1542, which provides
as follows: 

“A general release does not
extend to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor.” 

By signing this document,
Executive agrees and understands that Executive is releasing unknown as well as
known claims related to Executive’s employment in exchange for the compensation
set forth above. 

5. Except and until public
disclosure is required under applicable law, Executive agrees to maintain in
complete confidence the terms of this Release, except as it may be necessary to
comply with a legally compelled request for information. 

6. Executive’s execution of
this General Release and the absence of an effective revocation of such General
Release by Executive shall constitute Executive’s resignation from all offices,
directorships and other positions then held with the Employer or any of its
affiliates, and any other position held for the benefit of or at the request of
the Employer or any of its affiliates, and Executive hereby agrees that this
General Release constitutes such resignation. Executive also agree to execute a
confirmatory letter of resignation if requested.

7. Executive hereby
acknowledges and agrees that all personal property and equipment furnished to or
prepared by the Executive in the course of or incident to his employment, belong
to the Employer and shall, if physically returnable, be promptly returned to the
Employer upon termination of his employment. “Personal property” includes,
without limitation, all books, manuals, records, reports, notes, contracts,
lists, blueprints, and other documents, computer media or materials, or copies
thereof, and Proprietary Information. Following termination, the Executive will not retain any written or other
tangible material containing any Proprietary Information (as defined in the Agreement). 

15

8. The provisions of this
General Release are severable and in the event that a court of competent
jurisdiction determines that any provision of this General Release is in
violation of any law or public policy, in whole or in part, only the portions of
this General Release that violate such law or public policy shall be stricken.
All portions of this General Release that do not violate any statute or public
policy shall not be affected thereby and shall continue in full force and
effect. Further, any court order striking any portion of this General Release
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intent of the Employer and Executive under this General
Release.

9. Executive agrees to
indemnify and hold Employer harmless from and against any tax obligations for
which Executive may become liable as a result of this Release and/or payments
made pursuant to the Agreement, other than tax obligations of the Employer
resulting from the nondeductibility of any payments made pursuant to this
Release or the Agreement.

10. Agreeing to this Release shall not be deemed or construed by either party
as an admission of liability or
wrongdoing by either party.

11. This
Release, the Agreement and the plans of The Clorox Company referred to in the
Agreement set forth the entire agreement between Executive and the Employer with
respect to the subject matter hereof. This Release and the Agreement are not
subject to modification except in writing executed by both of the parties. The
Clorox Company plan documents of plans referred to in the Agreement may be
amended in accordance with the provisions of those plans.

16

12. Executive acknowledges
that (i) Executive has consulted with or has had adequate opportunity to consult with independent counsel of
Executive’s own choice concerning the Agreement and this Release, (ii)
Executive has been advised by the Company to consult with independent counsel of
Executive’s own choice regarding the Agreement and this Release, (iii) Executive
is fully aware of the legal effect of the Agreement and this Release, and (iv)
Executive agreed to enter into the Agreement, and is likewise entering into this
Release, freely based on Executive’s own judgment. 

Executive acknowledges by
signing below that Executive has not relied upon any representations, written or
oral, not set forth in this Release. 

	EXECUTIVE

 
	Signature

 
	Name

 
	Date

	THE CLOROX COMPANY

 
	Signature

 
	Name

 
	Date

17ex10-4.htm

 

Exhibit 10.6

 

BRIDGELINE DIGITAL, INC.

AMENDED AND RESTATED STOCK INCENTIVE PLAN

 

Restricted Stock Agreement

 

Bridgeline Digital, Inc. (the “Company”) hereby awards to you (the “Stockholder”) shares of Common Stock of the Company as follows: 

 

	  	
Name of Stockholder:
	
_______________________

	 	 	 
	  	
Total Number of Shares Awarded:
	
_______________________

	 	 	 
	  	
Purchase Price per Share:
	
_______________________

	 	 	 
	  	
Award Date:
	
_______________________

	 	 	 
	  	
Vesting Commencement Date:
	
_______________________

	 	 	 
	  	
Number of Shares Subject to Vesting Schedule:
	
_______________________

	 	 	 
	  	
Vesting Schedule:

 

     Each [Month/Quarter] Anniversary of Vesting 

     Commencement Date:

 

     _____ Years from Grant Date:
	
 

 

 

____ Shares Vest

 

All Shares Vested

	 	 	 
	  	
Expiration Date:
	
_______________________

 

By your signature and the signature of the Company’s representative below, you and the Company agree that this Award is made under and governed by the terms of the Company’s Amended and Restated Stock Incentive Plan and this Restricted Stock Agreement (this “Agreement”), which includes the Incorporated Terms and Conditions attached to and made a part of this Agreement. 

 

	STOCKHOLDER:	BRIDGELINE DIGITAL, INC.
	 	 
	
________________________________
	
By: ____________________________________

	
[Signature]
	
 

	
________________________________
	
Title: ___________________________________

	
[Printed Name]
	
 

	
________________________________
	
 

	[Address]	 
	________________________________	 

 

 

 

 

 

BRIDGELINE DITIGAL, INC.

 

Restricted Stock Agreement

under the Amended And Restated Stock Incentive Plan

 

Incorporated Terms and Conditions

 

 

1.     Issuance of Shares. On the terms and conditions set forth in this Agreement, the Company is issuing to the Stockholder on the Award Date, at the purchase price per share set forth on the signature page of this Agreement (the “Purchase Price”), the number of Shares of the Company’s Common Stock set forth on the signature page of this Agreement. The award of the Shares is made pursuant to and is governed by the Company’s Amended and Restated Stock Incentive Plan (the “Plan”), the terms of which are incorporated into this Agreement by this reference. Unless the context otherwise requires, capitalized terms used herein without definitions shall have the respective meanings assigned to them in the Plan. By signing this Agreement, the Stockholder acknowledges receipt of a copy of the Plan.

 

2.     Repurchase of Unvested Shares; Purpose and Waiver.

 

(a)     Repurchase of Shares if Service Terminates. If the Stockholder’s Service to the Company terminates for any reason (including, without limitation, death, disability, termination or voluntary resignation), the Company shall have the right and option but not the obligation (the “Purchase Option”) to purchase any of the Shares which have not vested in accordance with this Section 2 (the “Unvested Shares”) as of the effective date of such termination (the “Termination Date”) at a price per Share equal to the Purchase Price. Through and including the Termination Date, the Shares shall vest on a cumulative basis as provided on the vesting schedule set forth on the signature page of this Agreement. Notwithstanding the foregoing, the Board may, in its discretion, accelerate the date on which any portion of the Shares become vested.

 

(b)     Purpose and Waiver. The purpose of the Award of the Shares to the Stockholder is to encourage the Stockholder to enter into and/or maintain a continuing and long-term relationship with the Company. It is not a purpose of this Award to reward the Stockholder for the completion of any specific project or of any discrete period of Service which may fall between consecutive vesting periods. By signing this Agreement, the Stockholder hereby waives any claim to any Unvested Shares that are subject to repurchase upon the exercise of the Purchase Option.

 

 

2

 

 

3.      Custody of Stock Certificates.

 

(a)      Delivery. Upon the execution of this Agreement, the Stockholder shall deliver to the Company one or more stock transfer powers, satisfactory in form and substance to the Company and duly executed in blank by the Stockholder, sufficient to transfer the Unvested Shares to the Company in the event that the Company exercises the Purchase Option. As soon as practicable after receipt of such stock transfer powers, the Company shall deliver such stock transfer powers, together with the certificate or certificates representing the Shares, to the Treasurer of the Company, as custodian (the “Custodian”). The certificate or certificates so delivered to the Custodian shall be held by the Custodian for the benefit and in favor of the Stockholder, subject to the provisions of this Section 3. Notwithstanding the escrow, the Stockholder shall retain the right to vote and enjoy all other rights and incidents of ownership of the Shares represented by said certificates. The Custodian shall issue a receipt to the Stockholder evidencing the delivery of the stock certificates and transfer powers. The Custodian shall arrange to keep any stock certificates and stock transfer powers delivered to him or her under this Section 3 in a secure place and shall keep true and accurate records of all such certificates and powers.

 

(b)      Concerning the Custodian. The Company shall indemnify and hold harmless the Custodian against any and all costs or expenses (including attorneys’ fees expenses), judgments, fines, losses, claims, damages, liabilities and amounts paid in settlement in connection with any claim, action, suit, proceeding or investigation arising out of or pertaining to this Agreement. Any person succeeding to the office of Treasurer shall succeed to and assume the rights and obligations of Custodian hereunder.

 

(c)      Release. Following the close of each vesting date, upon the written request of the Stockholder, the Custodian shall deliver to the Stockholder stock certificates and stock transfer powers executed by the Stockholder representing such number of Shares as have ceased to be Unvested Shares hereunder as of such vesting date. The Stockholder shall execute such additional stock transfer powers and take such additional action as the Custodian shall request to enable the Custodian to maintain possession of stock certificates and stock transfer powers duly executed by the Stockholder representing the remainder of the Shares. After all of the Shares have vested, or at such time as the Company may elect in writing to waive the Purchase Option, the Custodian shall deliver to the Stockholder any stock certificates and stock transfer powers executed by the Stockholder representing Shares remaining in the possession of the Custodian. 

 

4.      Exercise of Purchase Option and Closing.

 

(a)      Exercise. The Company may exercise the Purchase Option by delivering or mailing to the Stockholder and to the Custodian, in accordance with Section 12(d), written notice of exercise within 90 days after the Termination Date. Such notice shall specify the number of Shares to be purchased. The Company may exercise the Purchase Option in whole or in part. If and to the extent the Purchase Option is not so exercised before the close of such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period, and the Unvested Shares with respect to which the Purchase Option is not exercised shall immediately cease to be Unvested Shares for any purpose under this Agreement.

 

 

3

 

 

(b)      Closing of the Repurchase. Within 15 days after the Company’s exercise of its Purchase Option pursuant to subsection (a) above, (i) the Custodian shall deliver to the Company the certificates and stock powers representing the Shares which the Company has elected to purchase under its Purchase Option; (ii) the Company shall mail or deliver to the Stockholder a check in the amount payable to the Stockholder hereunder for such Shares; and (iii) the Custodian shall mail or deliver to the Stockholder any certificates and stock transfer powers held by the Custodian representing Shares not purchased by the Company.

 

(c)      Company as Owner. After the Company exercises its Purchase Option pursuant to subsection (a) above, the Company shall not pay any dividend to the Stockholder on account of the Shares purchased by the Company pursuant to the Purchase Option or permit the Stockholder to exercise any of the privileges or rights of a stockholder with respect to such Shares, but shall, insofar as permitted by law, treat the Company as the owner of such Shares.

 

(d)      Cancellation of Indebtedness. Notwithstanding any provision of this Section 4 to the contrary, the amount payable to the Stockholder hereunder may be paid, at the option of the Company, in cancellation of all or a portion of any outstanding indebtedness of the Stockholder to the Company, in cash, by check or in combination of any of the foregoing.

 

(e)     No Disclosure Duties. The Company shall have no duty or obligation to disclose to the Stockholder, and the Stockholder shall have no right to be advised of, any material information regarding the Company or any of its subsidiaries or Affiliates, at any time prior to, upon or in connection with the exercise of the Purchase Option by the Company. 

 

(f)     Purchase Option Assignable. The Company’s Purchase Option under this Section 4 shall be freely assignable in whole or in part.

 

5.      Restrictions on Transfer. 

 

(a)      Unvested Shares Not Transferable. The Stockholder shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively “transfer”), any of the Unvested Shares, or any interest therein, except in compliance with Section 5(b)(iv) below.

 

(b)     Effect of Prohibited Transfer. Any transfer of Shares in violation of this Agreement shall be void. The Company shall not be required (i) to transfer on its books any of the Shares which shall have been transferred in violation of this Agreement or (ii) to treat as the owner of such Shares or pay dividends to any transferee to whom any such Shares shall have been so transferred.

 

 

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6.     Securities Law Restrictions on Resale. 

 

(a)     Stockholder’s Representations and Agreements. The Stockholder represents and agrees that (i) unless and until registered under Securities Act, the Shares will be of an illiquid nature and will be deemed to be “restricted securities” for purposes of the Securities Act; (ii) the Shares are being acquired for investment, and not with a view to the sale or distribution thereof; and (iii) such Shares may not be sold except in compliance with the registration requirements of the Securities Act or an exemption therefrom. 

 

(b)     Legends on Certificates. Unless the Shares have been registered under the Securities Act, each certificate evidencing any of the Shares shall bear a legend referring to the restrictions on transfer imposed by the Securities Act, and any applicable state securities laws, as well as the following legend:

 

The shares represented by this certificate have been issued pursuant to the terms of the Bridgeline Digital, Inc. Amended and Restated Stock Incentive Plan and may not be sold, pledged, transferred, assigned or otherwise encumbered in any manner except as is set forth in the terms of the Restricted Stock Agreement.

 

(c)     Removal of Legends. If, in the opinion of counsel to the Company, any legend placed on a stock certificate representing Shares issued under this Agreement is no longer required, then the holder of such certificate shall be entitled to exchange such certificate for a certificate representing the same number of Shares but without such legend.

 

(d)     Lock-up Agreement. The Stockholder agrees that, in the event that the Company effects any underwritten public offering of Common Stock registered under the Securities Act, neither the Shares nor any interest in the Shares may be sold, offered for sale, pledged or otherwise disposed of, directly or indirectly (including through the granting of options or any hedging transactions), without the prior written consent of the managing underwriter(s) of the offering, for the same period of time after the execution of an underwriting agreement in connection with such offering, and on the same terms, that all of the Company’s then directors and executive officers agree to be restricted.

 

7.      No Retention Rights. Nothing in the Plan or this Agreement confers upon the Stockholder any right to continue in the Service of the Company for any period of specific duration or shall be construed to interfere with or otherwise restrict in any way the rights of the Company or of the Stockholder, which rights are expressly reserved by each, to terminate the Stockholder’s Service at any time and for any reason, with or without cause.

 

 

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8.      Taxes. As a condition to the issuance of any Shares hereunder, the Stockholder hereby agrees that, if the Company in its discretion determines that it is or could be obligated to withhold any tax in connection with the issuance, vesting or transfer of such Shares, the Company may, in its discretion, withhold the appropriate amount of tax (i) in cash from the Stockholder’s wages or other remuneration or (ii) in kind from the Shares or other property otherwise deliverable to the Stockholder. The Stockholder further agrees that, if the Company has not previously withheld an amount sufficient to satisfy the withholding obligation of the Company, the Stockholder will on demand make reimbursement in cash for the amount underwithheld or, if permitted by the Board, provide such cash or other security as the Board deems adequate to meet the liability or potential liability of the Company for the withholding of tax, and to augment such cash or other security from time to time in any amount reasonably deemed necessary by the Board to preserve the adequacy of such cash or other security. The Stockholder understands that any election under Section 83(b) of the Code with regard to the Restricted Stock must be made within thirty (30) days of the Award Date and that, in the event of such election, the Stockholder will so notify the Company in writing on or before such date.

 

9.     Amendments. The Board may at any time or times amend the Plan or this Agreement for the purpose of satisfying the requirements of any changes in applicable laws or regulations or for any other purpose which at the time may be permitted by law. No termination or amendment of the Plan or amendment of this Agreement shall, without the Stockholder’s consent, materially adversely affect the Stockholder’s rights under this Agreement.

 

10.      Adjustments for Stock Splits, Stock Dividends, Etc. If from time to time while this Agreement remains in force and effect there is any stock split-up, stock dividend, stock distribution or other reclassification of the Common Stock of the Company, (a) any and all new, substituted or additional securities to which the Stockholder is entitled by reason of his or her ownership of Shares shall be immediately subject to the restrictions on transfer and other provisions of this Agreement in the same manner and to the same extent as such Shares and (b) appropriate adjustment shall be made to the Purchase Price.

 

11.     Consistency with Plan. If there is any inconsistency between the provisions of this Agreement and the provisions of the Plan, the latter shall control.

 

12.      Miscellaneous.

 

(a)     Severability; Governing Law. If any provisions of this Agreement shall be determined to be illegal or unenforceable by any court of law, the remaining provisions shall be severable and enforceable in accordance with their terms. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without giving effect to the principles of the conflicts of laws thereof.

 

 

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(b)     Injunctive Relief. It is acknowledged that it will be impossible to measure the damages that would be suffered by the Company if the Stockholder fails to comply with the provisions of this Agreement and that, in the event of any such failure, the Company will not have an adequate remedy at law. The Company shall, therefore, be entitled to obtain specific performance of each of the Stockholder’s obligations hereunder and to obtain immediate injunctive relief. The Stockholder shall not urge, as a defense to any proceeding for such specific performance or injunctive relief, that the Company has an adequate remedy at law.

 

(c)     Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, successors and permitted assigns.

 

(d)     Notices. All notices required or permitted hereunder shall be in writing and be effective upon personal delivery, upon deposit with the United States Post Office, by registered or certified mail, postage prepaid, or upon deposit with a recognized express overnight courier service, addressed, if to the Company, to its principal executive office at the time, Attention: President, and if to the Stockholder, to the address shown beneath his or her signature on the signature page of this Agreement, or at such other address or addresses as either party shall designate to the other in accordance with this Section 12(d).

 

(e)     Entire Agreement. This Agreement, together with the Plan, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, whether oral or written, of the parties hereto concerning the subject matter hereof.

 

(f)     Waivers. Any provision contained in this Agreement may be waived, either generally or in any particular instance, by the Board, but no such waiver shall operate to the detriment of the Stockholder without the Stockholder’s consent.

 

 

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