Exhibit 1
[Proxim Letterhead]
August 1, 2003
Xxxxxxxx Xxxxx
000 Xxxxxxxxxx Xxxxxx., #0000
Xxx Xxxxxxxxx, XX 00000
Dear Xxx:
In accordance with your conversation with Xxxxx Xxxxxxx on June 5, 2003, this
letter (the "Agreement") sets forth the details of the transitioning of your
duties and the termination of your service with Proxim Corporation (the
"Company").
1. SEPARATION. The Company and you have agreed that your service to
the Company in the capacity of Chief Executive Officer of the Company ended
effective June 5, 2003 (the "Notice Date").
2. TRANSITION PERIOD. Between the Notice Date and August 5, 2003 (the
"Separation Date"), you will serve the Company in the capacity of a
non-executive employee and as Chairman of the Board of Directors. During the
period of time between the Notice Date and the Separation Date (such period, the
"Transition Period"), you will be responsible for working with the Company to
transition your current projects and duties to the appropriate individual(s)
designated by the Company. During the Transition Period, the Company will
continue to pay you your regular base salary and employee benefits as in effect
on the Notice Date. You will be expected to be reasonably available to the
Company during the Transition Period, working out of your principal office in
San Francisco (the "Office"). The Company will continue to reimburse you for the
rental cost of the Office through the Separation Date. However, the Company will
pay for the employment of your administrative assistant only through July 4,
2003; thereafter, any costs associated with the performance of her services will
be solely at your expense. During the Transition Period, you will continue to be
bound by, and you agree to comply with, all of the Company's written policies
and procedures, including but not limited to its policies on xxxxxxx xxxxxxx
that were previously applicable to you as Chief Executive Officer of the
Company.
You acknowledge and agree that the termination of your employment is
a termination by the Company without "cause" pursuant to Section 11.01(b) of the
Amended and Restated Employment and Co-Investment Agreement dated October 31,
1999 (as amended, the "Employment Agreement"). You further acknowledge and agree
that you have been provided with the required written notice at least sixty (60)
days in advance of the Separation Date in full satisfaction of the Company's
obligations pursuant to Section 11.01 of the Employment Agreement.
Xxxxxxxx Xxxxx
August 1, 2003
Page 2
3. SEPARATION DATE. At the conclusion of the Transition Period, you
will resign from all positions you then hold with the Company and any of its
affiliates, including but not limited to your membership on the Company's Board
of Directors (the "Board"), effective as of the Separation Date. On or before
the Separation Date, you will be paid for all accrued but unpaid salary and any
accrued but unused vacation time.
4. SEVERANCE BENEFITS. Although the Company has no obligation to
provide any severance benefits to you, provided you execute the general release
of all claims attached hereto as Exhibit A (the "Release") between August 5,
2003 and August 22, 2003, and do not revoke the Release, and provided further
that you comply with all of your obligations to the Company under this Agreement
and the Employment Agreement, on the effective date of the Release (i.e., when
it is no longer revocable by you), the Company will amend your outstanding stock
option agreement(s) (as listed on Exhibit B) to provide (a) that all of the
shares subject to such stock options shall be fully vested and exercisable as of
the Separation Date, and (b) that you may have until the one (1) year
anniversary of the Separation Date in which to exercise the stock options as to
any vested and unexercised shares.
5. HEALTH INSURANCE. As a result of the termination of your services
to the Company, your coverage under the Company's group health insurance
programs will terminate on August 31, 2003. You will have the opportunity to
elect continuation coverage under the Company's group health insurance programs
as permitted pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended ("COBRA") or, if applicable, state insurance laws. You will be
provided with information regarding, and an opportunity to elect, such coverage
shortly.
6. EQUITY BENEFITS. Exhibit B to this Agreement sets forth your right
to purchase shares of the Company's capital stock and all shares of the capital
stock of the Company held by you, in each case as of the Separation Date and
prior to any acceleration of vesting to which you may be entitled under this
Agreement. You acknowledge and agree that except as set forth in this Agreement
and in those stock agreements (which documents are incorporated herein by
reference) which govern your rights to the shares described on Exhibit B, you
have no other right, title, interest, or claim in or to any shares of the
Company's capital stock.
7. OTHER COMPENSATION OR BENEFITS. You acknowledge that, except as
expressly provided in this Agreement, you will have no entitlement to any
salary, vacation pay, commissions, bonuses, wages, compensation or other
benefits after the Separation Date.
Xxxxxxxx Xxxxx
August 1, 2003
Page 3
8. EXPENSE REIMBURSEMENTS. Subject to the provisions of Section 2
above, the Company will reimburse you for those business expenses reasonably
incurred by you in connection with your duties to the Company prior to the
Separation Date. Please submit your documented expense reimbursement request in
accordance with the Company's standard policy and the Company will reimburse you
for such appropriately submitted expenses prior to September 13, 2003.
9. RETURN OF COMPANY PROPERTY/LAPTOP COMPUTER. As a condition to the
receipt of any severance benefits offered pursuant to this Agreement, you are
required to return to the Company, no later than the Separation Date, all
Company documents (and all copies thereof) and other Company property (including
any confidential information or trade secrets) that you have had in your
possession at any time, other than Company documents provided to you that relate
to your employment relationship with the Company, such as benefit plans, Company
policies and the like. Notwithstanding the foregoing, the Company agrees that
you shall be permitted to keep the laptop computer that the Company previously
issued to you (the "Laptop") after the Company has had the opportunity to
reformat the Laptop's storage unit. Accordingly, on the Separation Date, and
contingent upon your providing the Company with the opportunity to reformat the
Laptop's storage unit, the Company shall transfer legal title to the Laptop to
you.
10. CONFIDENTIALITY. The provisions of this Agreement will be held in
strictest confidence by you and the Company and will not be publicized or
disclosed in any manner whatsoever; provided, however, that: (a) you may
disclose this Agreement in confidence to your immediate family; (b) the parties
may disclose this Agreement in confidence to their respective attorneys,
accountants, auditors, tax preparers, and financial advisors; (c) the Company
may disclose this Agreement as necessary to fulfill legally required corporate
reporting or disclosure requirements; and (d) the parties may disclose this
Agreement insofar as such disclosure may be necessary to enforce its terms or as
otherwise required by law.
11. CONFIDENTIAL INFORMATION; NON-SOLICITATION. You understand and
agree that this Agreement is not intended to modify or supersede your
obligations pursuant to (i) Sections 3.01 and 4.01 of the Employment Agreement,
(ii) the memorandum from Xxxx Xxxxxxxxx related to the "Use of Confidential
Information" executed by you on September 1, 2000, and (iii) the Employment,
Confidential Information and Invention Assignment Agreement executed by you on
January 9, 2002.
12. NONDISPARAGEMENT. During the Transition Period and thereafter,
(a) you agree not to disparage the Company or its officers, directors,
employees, shareholders and agents and (b) the Company agrees not to (and to
direct its officers, directors, employees, shareholders or agents not to)
disparage you.
Xxxxxxxx Xxxxx
August 1, 2003
Page 4
13. CONTINUING REPRESENTATIONS. This Agreement in no way modifies the
Company's ability to terminate your employment for "cause" pursuant to Section
11.01(a) of the Employment Agreement during the Transition Period.
14. MISCELLANEOUS. Any amounts payable to you pursuant to this
Agreement will be subject to applicable employment tax withholdings and other
lawful deductions. This Agreement constitutes the complete, final and exclusive
embodiment of the entire agreement between you and the Company with regard to
this subject matter, and it supersedes any prior understandings of agreements,
whether oral or written. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein.
This Agreement will be deemed to have been entered into and will be construed
and enforced in accordance with the laws of the State of California as applied
to contracts made and to be performed entirely within California. This Agreement
may be executed in counterparts, each of which shall be deemed an original, all
of which together shall constitute one and the same instrument. Facsimile
signatures shall suffice as originals.
If this Agreement is acceptable to you, please sign below and return the
original to me on or before August 22, 2003.
I wish you good luck in your future endeavors.
Sincerely,
PROXIM CORPORATION
By:
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Xxxxx Xxxxxxx, on behalf of the Board
Understood and Agreed:
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Xxxxxxxx Xxxxx
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Date
EXHIBIT A
GENERAL RELEASE OF ALL CLAIMS
I, Xxxxxxxx Xxxxx, understand and agree that my employment, and my
service in any capacity, with Proxim Corporation (the "Company") terminated on
August 5, 2003. In consideration for the benefits provided to me by the Company,
as described in the separation agreement (the "Agreement," incorporated by
reference herein) between the Company and me which I executed on August 21,
2003, which benefits I would not otherwise be entitled to, I hereby make the
following representations, warranties and affirmations:
1. I represent and warrant that at all times I have been in
compliance with the terms and conditions of the Agreement and all of my other
obligations to the Company. I expressly represent and warrant that I have
returned all of the Company's property, including but not limited to any
confidential or proprietary information, trade secrets and documents that have
been at any time in my possession; provided, however, that in accordance with
Section 9 of the Agreement, I shall be entitled to retain my "Laptop" (as
defined in the Agreement) after the Company has reformatted the storage unit,
copies of Company employee benefit plans, Company policies and the like. I
further represent and warrant that I have resigned as a member of the Company's
Board of Directors effective August 5, 2003.
2. I acknowledge and agree that I have received all salary, accrued
vacation, commissions, bonuses, wages, compensation or other such sums due to me
as of the Separation Date, other than the benefits, if any, to be provided to me
after the Separation Date pursuant to Sections 4 and 8 of the Agreement.
3. In consideration of the benefits to be provided to me by the
Company as set forth in the Agreement, I on behalf of myself, my agents,
attorneys, successors, assigns, heirs and executors hereby fully and forever
release and discharge the Company, and its current and former officers,
directors, shareholders, partners, members, investors, administrators,
employees, contractors, agents, attorneys, insurers, affiliates, successors,
predecessors, subsidiaries, assigns and fiduciaries in their individual and/or
representative capacities (collectively, the "Released Parties") from any and
all claims, suits, agreements, promises, damages disputes, controversies,
contentions, differences, judgments, debts, dues, sums of money, accounts,
reckonings, bonds, causes of action, bills, covenants, contracts, variances,
trespasses, extents, executions and demands of any kind whatsoever, which I or
my agents, attorneys, successors, assigns, heirs and executors ever had, now
have or may have against the Released Parties or any of them, in law, admiralty
or equity, for, upon, or by reason of, any matter, action, omission, course or
thing whatsoever occurring up to the date this Release is signed by me, arising
in connection with or in relationship to my employment or other service
relationship with the Company or its affiliates, the termination of any such
employment or service relationship and any applicable employment, compensatory
or equity arrangement with the Company or its respective affiliates (such
released claims are collectively referred to herein as the "Released Claims");
provided that such Released Claims shall not include (a) any claims to enforce
my rights
under, or with respect to, this Release or Sections 6.01(h) or 10.01 of the
Employment Agreement (as defined in the Agreement), or (b) any other rights to
indemnification (whether arising under the Company's Certificate of
Incorporation or Bylaws, any applicable law, or any Company resolution or
Company written policy, or (c) any rights under any Director and Officer
liability insurance policy or other insurance maintained by the Company for the
benefit or its directors or employees. I understand and agree that this Release
is a full and complete waiver of all claims, whether known or unknown by me,
including, but not limited to, any claims with respect to my entitlement to any
wages, bonuses, severance benefits or other forms of compensation; any claims
with respect to my purchase of, or right to purchase, any capital stock of the
Company; any claims of wrongful discharge, breach of contract, breach of the
covenant of good faith and fair dealing, violation of public policy, defamation,
personal injury, emotional distress; any claims under Title VII of the Civil
Rights Act of 1964, as amended, the Fair Labor Standards Act, the California
Fair Employment and Housing Act, the Equal Pay Act of 1963, the Americans With
Disabilities Act, California Labor Code Section 1197.5, the Civil Rights Act of
1991, the Age Discrimination in Employment Act of 1967, as amended, the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") as related to
severance benefits, any family and medical leave acts; and any claims under any
other federal, state, and local laws and regulations relating to employment or
employment discrimination. I agree that the benefits provided to me pursuant to
the Agreement are in full satisfaction and settlement of any such Released
Claims. I represent and warrant that I have not filed, and I will not file, any
lawsuit or institute any proceeding, charge, complaint or action asserting any
such claim before any federal, state, or local administrative agency or court
against any Released Party, concerning any event occurring prior to the signing
of this Release. Nothing in this Release, however, shall be construed as
prohibiting me from filing a charge or complaint with the Equal Employment
Opportunity Commission ("EEOC") or participating in an investigation or
proceeding conducted by the EEOC. I also hereby agree that nothing contained in
this Release shall constitute or be treated as an admission of liability or
wrongdoing by any of the Released Parties.
4. I represent that I am knowingly and voluntarily waiving any and
all rights that I currently may have arising under the Age Discrimination in
Employment Act of 1967, as amended. I understand that I have the right to
consult with an attorney before signing this Release. I also understand that I
may have twenty-one (21) days after my receipt of this Release within which I
may review and consider, discuss with an attorney of my own choosing, and decide
to execute or not execute it. I further understand that for a period of seven
(7) days after I sign this Release, I may revoke this release of all claims. In
order to revoke this Release, I must deliver to the Chief Executive Officer of
the Company, by no later than seven (7) days after I execute this Release, a
letter stating that I am revoking it. I understand and agree that if I revoke
this Release, I will have no right to receive, and the Company will have no
obligation to provide, any of the benefits described in the Agreement. If I do
not deliver such a letter, then this Release shall become effective upon the
expiration of the seventh day after I execute this Release (the "Effective
Date"). If I execute this Release prior the twenty-first (21st) day after its
delivery to me, I hereby acknowledge that my decision to execute this Release
prior to the expiration of such twenty-one (21) day period was entirely
voluntary.
5. I UNDERSTAND THAT MY RELEASE SET FORTH ABOVE INCLUDES A RELEASE OF
ALL KNOWN AND UNKNOWN CLAIMS. In giving this release, which includes claims
which may be unknown to me at present, I acknowledge that I have read and
understand Section 1542 of the California Civil Code which reads 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." I
hereby expressly waive and relinquish all rights and benefits under that section
and any law of any jurisdiction of similar effect with respect to my release of
any unknown or unsuspected claims I may have against the Released Parties.
6. If any one or more of the provisions of this Release, including,
without limitation, my obligations pursuant to any one or more provisions of the
Agreement, shall be or become invalid, illegal or unenforceable in any respect
or to any degree, the validity, legality and enforceability of the remaining
provisions of this Release (and the Agreement) shall not be affected thereby and
said illegal, unenforceable or invalid provisions shall be deemed not to be a
part of this Release.
7. This Release, including the Agreement, constitutes the complete,
final and exclusive embodiment of the entire agreement between the Company and
me with regard to this subject matter. This Release is entered into without
reliance on any promise or representation, written or oral, other than those
expressly contained herein, and it supersedes any other such promises,
warranties or representations. This Release will be deemed to have been entered
into and will be construed and enforced in accordance with the laws of the State
of California as applied to contracts made and to be performed entirely within
California.
9. I hereby represent and warrant that:
(a) I have been given at least twenty-one (21) days from
the date that this Release was delivered to me in which to
accept its terms;
(b) I have carefully read and fully understand all of the
terms of the Agreement;
(c) I have been advised in writing to consult with an
attorney of my choice prior to executing this Agreement,
and I have done so or knowingly declined to do so; and
(d) I knowingly and voluntarily agree to all of the terms
set forth in this Release with full appreciation that I am
forever foreclosed from pursuing any of the rights waived
herein.
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Xxxxxxxx Xxxxx
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Date
EXHIBIT B
EQUITY RIGHTS
