EXHIBIT 10.39
July 21, 2008
Xxxxx Xxxxxxxxx
Re: Retention Agreement
Dear Xxxxx:
In recognition of your position as a key employee of NMS Communications
Corporation ("NMS" or "the Company") and in order to induce you to remain in the
employ of the Company, the Company desires to enter into this Agreement with you
to provide you with certain benefits in the event your employment is terminated
as a result of, or in connection with, a change of control of the Company.
Retention Bonus
As an inducement for your continuing your employment at the Company, the Company
is pleased to offer you a one-time lump sum bonus payment (the "Bonus") equal to
the greater of (i) $400,000 or (ii) one percent (1%) of the total gross
consideration received by the Company in connection with any Change in Control
(as defined below), less applicable withholding deductions. The consummation of
any Change in Control shall be referred to herein as a "Transaction". The Bonus
shall be paid in U.S. dollars, subject to the terms and conditions in this
letter.
o You shall continue to be an employee of the Company through the closing
date of any Transaction and, at the request of the Buyer in any
Transaction, you shall agree to be an employee of Buyer (or an affiliate
thereof) for a period of ninety (90) days following the closing date. You
shall perform your present responsibilities, overall company business
operations and related business activities, as requested by the Company,
from time-to-time in a manner consistent with your past high-level of
performance.
o The Company shall pay to you the Bonus within thirty (30) days following
the Closing Date. To avoid any doubt, the Bonus is not due or payable
based upon the signing of a purchase and sale agreement unless
contemporaneous with the closing of the Transaction.
o The payment of the Bonus will be subject to all required withholdings and
tax payments and is payable subject to the continued compliance by you
with the terms of the Employee Non-Compete and Confidentiality and
Agreement dated June 18, 2007. To the extent required by Section 409A of
the Internal Revenue Code, as amended, to avoid imposition of the 20%
additional tax, the Bonus may be delayed until at least six months after
the expiration of the Transition Period.
o This letter shall not be construed as changing your employment
relationship with the Company, nor shall it create any legal obligation
on your part or the Company's part to continue your employment at the
Company for any period of time.
o If before the Closing Date of any Transaction you cease working for the
Company on a full-time basis, you resign from your employment, the
Company terminates your employment with Cause (as defined below) or you
and the Company mutually terminate your employment, you shall not be
entitled to receive the Bonus. If the Company terminates your employment
without Cause, you shall be entitled to receive the Bonus with respect to
any Transaction which occurs within six (6) months of your termination.
This letter and the Severance Protection Agreement by and between you and the
Company, dated as of July 2, 2007, contains the entire agreement, and supersedes
and rescinds all pre-existing agreements, negotiations or arrangements, between
you and the Company relating to the subject matter herein. No one else is
authorized to make any representations or promises to you regarding the subject
matter herein, and this letter can only be modified by a written amendment that
is duly signed by the Company' President and CEO. In no event shall any email
communication be construed as an amendment to this letter.
For purposes of this letter agreement, "Change in Control" shall have the same
meaning as set forth in your Severance Protection Agreement. For purposes of
this letter agreement, termination of employment is for "Cause" if the
termination is by reason of any of the following:
(a) You intentionally and continually failed substantially to perform
your reasonably assigned duties with the Company (other than a
failure resulting from your incapacity due to death, physical or
mental illness) which failure continued for a period of at least
thirty (30) days after a written notice of demand for substantial
performance specifying the manner in which you have failed
substantially to perform, signed by a duly authorized officer of the
Company or
(b) You intentionally engaged in conduct which is demonstrably and
materially injurious to the Company; provided, however, that no
termination of your employment shall be for Cause unless (1) you have
received a copy of a written notice, signed by a duly authorized
officer of NMS, specifying and documenting the particulars of your
actions and (2) you shall have been provided an opportunity to be
heard in person by the Company's Compensation Committee.
This letter shall remain in effect through March 31, 2009. Thereafter, this
letter shall expire without any extension or renewal, provided, however, that if
at the time of expiration there is in existence a written purchase agreement for
the Transaction which has been signed by the Company and Buyer, then this letter
shall be automatically extended until closing the Transaction or if closing does
not occur upon expiration or termination of such purchase agreement. Except as
expressly stated in the immediately preceding sentence, this letter shall only
be extended or renewed by a signed written amendment as permitted in this
letter.
If you agree to this letter and desire to become eligible to receive the Bonus,
please confirm your acceptance by countersigning below and returning this letter
to me within five (5) days of the date first staled above in this letter.
Sincerely,
NMS Communications Corporation
By /s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
President and CEO
CONFIRMATION OF ACCEPTANCE:
Signature: /s/ Xxxxx Xxxxxxxxx
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Date: 7/18/08
