Exhibit 10.41
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
This FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this "Amendment") by
and between Xxxxx X. Xxxx ("Executive") and Proxim Corporation (the "Company")
is effective as of the Effective Date.
RECITALS
The Company desires to employ Executive exclusively as the Vice
Chairman of its Board of Directors, and in order to induce Executive to resign
from his current positions with the Company and accept his appointment as Vice
Chairman, the Company desires to provide Executive with the compensation and
other benefits on the terms and conditions set forth in this Amendment.
Executive is willing to accept such appointment and perform the
services for the Company resulting therefrom and resign from his current
positions with the Company and its subsidiaries, on the terms and conditions
hereinafter set forth.
It is therefore agreed by and between the parties as follows:
1. Original Agreements; Security Agreement. Except as expressly
set forth in this Amendment, the terms and provisions of each of (i) the
Employment Agreement dated as of January 16, 2002 by and between the Company and
Executive (the "Employment Agreement"), (ii) the Change of Control Severance
Agreement dated as of June 18, 1998 by and between Proxim, Inc. and Executive
(the "Severance Agreement," and, collectively with the Employment Agreement, the
"Original Agreements") and (iii) the Reimbursement and Security Agreement
entered into in March 2001 by and between the Company (as successor in interest)
and Executive (the "Security Agreement") shall remain in full force and effect.
References herein to the Employment Agreement shall be to the Employment
Agreement as amended hereby.
2. Appointment; Resignation; Effective Date.
a. Effective upon Executive's appointment to the position
of Vice Chairman of the Company's Board of Directors (the "Effective Date"),
Executive hereby (i) consents and agrees to such appointment and (ii) resigns
and withdraws from any and all other positions, offices, titles, roles and/or
duties held by him with or in the Company and any of its subsidiaries.
b. From and after the Effective Date, all references in the
Employment Agreement to Executive's "position" or "employment" or Executive's
status as "employed" (or comparable references) with the Company shall be with
respect to his position as Vice Chairman of the Company's Board of Directors,
and not with respect to any other position, office, title, role or duty.
Executive shall continue to serve as an employee of the Company.
c. In his position as Vice Chairman of the Company's Board
of Directors, Executive shall be responsible for advising and otherwise
supporting the Chairman as to the Company's wireless local area network (WLAN)
strategy and related business development and the prosecution of WLAN litigation
to which the Company is currently a party, and such other duties and
responsibilities as are reasonably assigned by the Chairman of the Company's
Board of Directors.
d. None of (i) the execution, delivery and/or performance
of this Amendment by the Company or Executive, (ii) any actions, events, facts
or circumstances proximately caused by or reasonably resulting therefrom, (iii)
Executive's appointment as the Company's Vice Chairman, or (iv) Executive's
resignation from any position, office, title, role or duty in or with the
Company or any of its subsidiaries shall constitute (a) the termination of
Executive's employment for any purpose under this Amendment or the Original
Agreements or (b) "Involuntary Termination," as defined in and for purposes of
the Severance Agreement.
e. Sections 9(c)(ii)(u) and 9(c)(ii)(v) of the Employment
Agreement are hereby deleted and Sections 9(c)(ii)(w) through (z) and the
corresponding cross-references in the last sentence of Section 9(c)(ii) are
relettered accordingly.
f. New Section 9(c)(ii)(v) (as relettered hereby) is hereby
amended to read as follows:
"(w) any material adverse reduction in, or material adverse
change of, Executive's duties and responsibilities made without Executive's
written consent; or"
g. The Company and Executive each acknowledge that "Good
Reason" exists for Executive's termination of employment under Section 9(c)(ii)
of the Employment Agreement as a result of the events listed in paragraph d.
above and that Executive may resign at any time for any reason or no reason
subsequent to the Effective Date and receive severance payments in accordance
with the provisions of Section 9(c)(iii) of the Employment Agreement, as amended
hereby.
3. Lump Sum Severance Payment. Notwithstanding anything to the
contrary in the Original Agreements, but subject to the other provisions of this
Section 3 of the Amendment, all payments or other benefits due Executive upon
the termination of his employment with the Company under the Original
Agreements, reduced by any amounts then owed to the Company by Executive, shall
be due and payable in full in a single lump sum payment on the date that is
thirty (30) days following such termination of employment. Executive
acknowledges and agrees that nothing in this Section 3 shall be read to impair
or prejudice the Company's security interest in said lump sum payment pursuant
to, inter alia, Sections 5, 6 and 7 of the Security Agreement. Executive further
acknowledges and agrees that all payments or other benefits due Executive upon
any termination of his employment with the Company under the Original Agreements
and this Amendment, including without limitation, the severance described above,
shall be retained by the Company and not paid to Executive to the extent
necessary to satisfy and
setoff amounts then owed by Executive to the Company, including, but not limited
to, Executive's obligations to the Company under the Security Agreement.
4. Option Award. Not later than 2 business days following the
date that Executive remits the proceeds of the home equity loan under Section 6
below, Executive shall be granted a nonqualified stock option (the "New Option")
to purchase 100,000 shares of the Company's common stock at the fair market
value on the date of grant. The New Option shall vest and become exercisable as
to 33 1/3% of the shares subject to the New Option on the first anniversary of
the date of grant, and the remaining 66 2/3% of the shares subject to the New
Option shall vest and become exercisable in equal monthly installments over the
subsequent two (2) year period; provided, however, that Executive must be
employed by the Company on the relevant vesting dates. The New Option shall not
permit the vesting of a fractional share. The New Option shall (i) have a
maximum term of ten (10) years from the date of grant (subject to earlier
expiration in the event of the termination of Executive's employment with the
Company), (ii) terminate with respect to any vested and unvested shares
immediately preceding any bankruptcy of Executive, (iii) otherwise contain
substantially the same terms and conditions as the Company's standard form of
stock option agreement and (iv) not be inconsistent with Section 9 of the
Employment Agreement, except that Section 9(c)(iii)(C) is hereby amended to
exclude the New Option from the definition of "Subsequent Options". The public
resale of shares subject to the New Option shall be registered on a Registration
Statement on Form S-8 to the extent permitted by applicable federal securities
laws.
5. Eligibility to Participate in Option Exchange Program.
Executive will be entitled to participate in any option exchange or repricing
program or any other similar plan or arrangement open to all or substantially
all of the Company's executive officers on the same terms and conditions as are
applicable to such officers. Executive acknowledges that he has not requested
nor has knowledge of any present intention of the Company's Board of Directors
to adopt or initiate such a program.
6. Agreement to Secure Home Equity Loan. As soon as practicable
following the Effective Date, but in no event greater than 75 days, Executive
will obtain a home equity loan with respect to his principal residence at 345
Hermosa, Menlo Park, California in an outstanding principal amount of not less
than $500,000 and remit the entire proceeds thereof to the Company to be applied
against amounts owed to the Company by Executive.
7. Term of Noncompete. In the event that the Effective Date shall
occur, notwithstanding anything in the Original Agreements to the contrary,
Section 10(b) of the Employment Agreement and Section 5(a) of the Severance
Agreement shall lapse one (1) year following the termination of Executive's
employment and, from and after that date, be of no further force or effect.
8. Miscellaneous. Sections 12(a) through (i) and (k) of the
Employment Agreement are incorporated herein by reference and applicable to this
Amendment as if fully set forth herein.
IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment
on December 9, 2002, to become effective as of the Effective Date.
PROXIM CORPORATION
By: /s/ Xxxxxxxx Xxxxx
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Name: Xxxxxxxx Xxxxx
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Title: Chief Executive Officer
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EXECUTIVE
/s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
