VMware 2009 Annual Report Download - page 117

(d) a material breach of this letter agreement.
In order for you to invoke a termination due to Good Reason following a Change in Control, as described above, (A) you must provide written
notice to the senior officer of VMware’s Human Resources group of your intention to terminate due to such condition within 90 days of the
initial existence of such condition and provide VMware with 30 days from receipt of the notice to remedy such condition, and (B) VMware must
fail to remedy such condition within the 30 day cure period.
The intent of the parties is that payments and benefits under this letter agreement comply with or be exempt from Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”), and the regulations and guidance promulgated thereunder (collectively “Section 409A”) and,
accordingly, to the maximum extent permitted, this letter agreement shall be interpreted to be in compliance therewith. If any provision of this
letter agreement (or of any award of compensation, including equity compensation or benefits) would cause you to incur any additional tax or
interest under Section 409A, the Company shall, after consulting with and receiving your approval (which shall not be unreasonably withheld),
reform such provision; provided that the Company agrees to maintain, to the maximum extent practicable, the original intent and economic
benefit to you of the applicable provision without violating the provisions of Section 409A.
A termination of employment shall not be deemed to have occurred for purposes of any provision of this letter agreement providing for the
payment of any amounts or benefits that are considered nonqualified deferred compensation under Section 409A upon or following a termination
of employment unless such termination is also a “separation from service” within the meaning of Section 409A and, for purposes of any such
provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If
you are deemed on the date of termination to be a
“specified employee” within the meaning of that term under Section 409A(a)(2)(B), then with
regard to any payment or the provision of any benefit that is considered nonqualified deferred compensation under Section 409A payable on
account of a “separation from service,” such payment or benefit shall be made or provided at the date which is the earlier of (i) the expiration of
the six (6)-month period measured from the date of such “separation from service” and (ii) the date of your death (the “Delay Period”).
Upon the
expiration of the Delay Period, all payments and benefits delayed pursuant to this paragraph (whether they would have otherwise been payable in
a single sum or in installments in the absence of such delay) shall be paid or reimbursed to you in a lump sum with interest at the prime rate as
published in the Wall Street Journal on the first business day of the Delay Period, and any remaining payments and benefits due under this letter
agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
All expenses or other reimbursements provided herein that are taxable income to you shall in no event be paid later than the end of the calendar
year next following the calendar year in which you incur such expense. With regard to any provision herein that provides for reimbursement of
costs and expenses or in-kind benefits, except as permitted by Section 409A, (i) the right to reimbursement or in-kind benefits shall not be
subject to liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, of in-kind benefits, provided
during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year,
provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Code
Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall
be made on or before the last day of your taxable year following the taxable year in which the expense occurred. Any tax gross-up payment as
provided herein shall be made in any event no later than the end of the calendar year immediately following the calendar year in which you remit
the related taxes, and any reimbursement of expenses incurred due to a tax audit or litigation shall be made no later than the end of the calendar
year
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