AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit
10.9
AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
This Amendment to Executive Employment Agreement (the “Amendment”) is made and entered into as
of December 24, 2008 (the “Effective Date”), by and between Cavium Networks, Inc., a Delaware
corporation (the “Company”) and Xxxx Xxx (“Executive”).
RECITALS
A. The Company retains the services of Executive pursuant to that certain Executive Employment
Agreement dated January 2, 2001 (the “Employment Agreement”).
B. The Company and Executive wish to amend the Employment Agreement to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended.
AGREEMENT
Section 5.1 of the Employment Agreement is hereby amended and restated in its entirety to read
as follows:
5.1 Severance Payments and Benefits. If the Company terminates Executive’s employment Not
For Cause (as defined below), or Executive is constructively terminated (as defined below),
and such termination results in a “separation from service” with the Company within the
meaning of Treasury Regulation Section 1.409A-1(h) (without regard to any possible
alternative definition thereunder) (a “Covered Termination”), the Company will pay Executive
all compensation due and owing through the date of the Covered Termination, and Executive
shall receive the following severance payments and benefits; provided, however, that such
severance and benefits are conditioned on Executive’s execution of a release agreement in a
form satisfactory to the Company within sixty (60) days following the date of the Covered
Termination.
Section 5.1.1 of the Employment Agreement is hereby amended and restated in its entirety to
read as follows:
5.1.1 Termination. The Company will continue to pay to Executive a sum equal to fourteen
thousand five hundred eighty-three dollars ($14,583) per month for a period of
twelve (12) months from the date of the Covered Termination (the “Severance Payments”).
Section 5.1.2 of the Employment Agreement is hereby amended and restated in its entirety to
read as follows:
5.1.2 Health Insurance. Within the time prescribed by law, upon termination of Executive’s
employment, Executive shall elect under the Federal COBRA law to continue to receive his
health insurance benefits under the Company’s group health insurance then in effect. The
Company shall reimburse Executive for the payment of such benefits for a period of twelve
(12) months after Executive’s termination, if terminated Not For Cause provided that
Executive makes the appropriate COBRA
election (the “COBRA Benefits”). If COBRA or similar
benefits are not available by law, then the Company shall reimburse Executive up to one
thousand dollars ($1,000) per month for twelve (12) months after termination Not For Cause
for health insurance and/or benefits (the “Non-COBRA Benefits”).
Section 6.3 of the Employment Agreement is hereby amended and restated in its entirety to read
as follows:
6.3 Cooperation in Pending Work. Following any termination of Executive’s employment,
Executive shall reasonably cooperate with Company in all matters relating to the winding up
of pending work on behalf of Company and the orderly transfer of work to other employees of
Company; provided, however, that Executive shall not be required to provide a level of
services to the Company that would cause Executive to avoid having a “separation from
service” with the Company within the meaning of Treasury Regulation Section 1.409A-1(h).
Executive shall also cooperate in the defense of any action brought by any third party
against Company that relates in any way to
Executive’s acts or omissions while employed by Company. The Company shall reimburse the
Executive for his reasonable out-of-pocket costs incurred to cooperate and pay Executive an
hourly rate based upon his base salary.
A new Section 18 is hereby inserted to read as follows:
18. Application of Section 409A. All payments provided hereunder are intended to
constitute separate payments for purposes of Treasury Regulation Section 1.409A-2(b)(2). If
Executive is a “specified employee” of the Company or any affiliate thereof (or any
successor entity thereto) within the meaning of Section 409A(a)(2)(B)(i) of the Internal
Revenue Code of 1986, as amended (the “Code”) on the date of a Covered Termination, then the
Severance Payments and Non-COBRA Benefits shall be delayed until the earlier of: (i) the
date that is six (6) months after the date of the Covered Termination, or (ii) the date of
Executive’s death (such date, the “Delayed Payment Date”), and the Company (or the successor
entity thereto, as applicable) shall (A) pay to Executive a lump sum amount equal to the sum
of the Severance Payments and Non-COBRA Benefits that otherwise would have been paid to
Executive on or before the Delayed Payment Date, without any adjustment on account of such
delay, and (B) continue the Severance Payments and Non-COBRA Benefits in accordance with any
applicable payment schedules set forth for the balance of the period specified herein. The
COBRA Benefits are not intended to be delayed pursuant to Section 409A(a)(2)(B)(i) of the
Code and are intended to be paid pursuant to the exception provided by Treasury Regulation
Section 1.409A-1(b)(9)(v)(B).
In Witness Whereof, the Company and Executive have executed this Amendment on the
dates set forth below, to be effective immediately as of the Effective Date.
| Cavium Networks, Inc. | ||||
By:
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/s/ Art Xxxxxxxx
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Its:
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CFO
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Date:
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12-24-08
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| Executive | ||||
| /s/ Xxxx Xxx | ||||
| Date: 12-24-08 | ||||
