EXHIBIT 10.22
SEVERANCE AND CHANGE IN CONTROL
AGREEMENT
Hing Chu
Address on File
Dear Hing:
This Severance and Change in Control
Agreement (this “Agreement”) amends the employment
letter agreement dated May 8, 2001 (the “Prior
Agreement”), by and between Atheros Communications, Inc. (the
“Company”) and you. This Agreement supersedes any
provisions in the Prior Agreement relating to severance payments
and benefits, including payments and benefits upon termination in
the event of a change in control of the Company.
Severance.
If the Company terminates your
employment other than for Cause (as defined below) prior to a
Change of Control (as defined below) or more than 12 months
following a Change of Control, and provided that you sign and do
not revoke within the time period specified by the Company a
standard release of claims in a form mutually acceptable to the
Company and you, then you will receive the following: (a) a
lump sum severance payment within 30 days following your
termination equal to six months of your base salary at the highest
rate in effect during your employment with the Company, and
(b) if you properly elect to continue the Company’s
group health plan coverage under COBRA, the continuation of your
health coverage for you and your enrolled dependents at no cost to
you for six months following the effective date of termination. You
will be able to continue your health benefits beyond six months at
your own expense as allowed under the Company’s health
plans.
Change In Control:
In the event of a Change of Control
(as defined below), if your employment is terminated without Cause
(as defined below) or you terminate your employment for Good Reason
(as defined below), in either case within 12 months following the
Change of Control, and provided that you sign and do not revoke
within the time period specified by the Company (or its successor)
a standard release of claims in a form mutually acceptable to the
Company (or its successor) and you, then you shall receive the
following: (a) a lump sum severance payment within 30 days
following your termination equal to 12 months of your base salary
at the highest rate in effect during your employment with the
Company; (b) if you properly elect to continue the
Company’s group health plan coverage under COBRA,
continuation by the Company (or its successor) of your health
coverage for you and your enrolled dependents at no cost to you for
12 months following the effective date of termination (you will be
able to continue your health benefits beyond 12 months at your own
expense as allowed under the Company’s health plans);
(c) if not already paid to you at the time of termination,
your earned cash incentive bonus under the Company’s bonus
plan in effect for the calendar year immediately prior to the
termination, as determined by the Board of Directors, payable at
the time of termination or the time at which the Board of Directors
has determined the amount of the bonus, whichever is later;
(d) your baseline target annual cash incentive bonus under the
Company’s bonus plan in effect during the calendar year of
the termination, pro rated for the portion of the then current
calendar year prior to the date of termination, payable within 30
days after the date of your termination; and (e) all of your
unvested stock options and restricted stock units granted by the
Company to you prior to the Change of Control and that have been
assumed or substituted by the acquiring company, shall become fully
vested as of the date of termination, and (f) the period in
which vested stock options may be exercised will be extended to the
earlier of one year following your termination date or the original
expiration date of the option grant.
“Change of Control”
means: (a) any merger, acquisition or similar transaction or
series of related transactions in which the Company is not the
surviving entity, except for a transaction the principal purpose of
which is to change the jurisdiction in which the Company is
incorporated, (b) the sale, transfer or other disposition of
all or substantially all of the assets of the Company, or
(c) any reverse merger or acquisition in which the Company is
the surviving entity but in which more than fifty percent
(50%) of the Company’s outstanding voting stock is
transferred to holders different from those who held the stock
immediately prior to such merger.
“Cause” means
(a) intentional and material dishonesty in the performance of
your duties for the Company; (b) conduct (including conviction
of or plea of nolo contendere to a felony) which has a direct and
material adverse effect on the Company or its reputation;
(c) failure to materially perform your reasonable duties or
comply with your obligations under this Agreement or the
Company’s Confidential Information and Invention Assignment
Agreement after receipt of written notice specifying the failure,
if you do not re
