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Exhibit 10.06
OMNEON VIDEO NETWORKS, INC.
AMENDED AND RESTATED LAWRENCE R. KAPLAN RETENTION
AGREEMENT
The agreement
entered into as of November 1, 2002 (the " Prior
Agreement ") by and between Omneon Video
Networks, Inc. (the " Company ") and Lawrence R.
Kaplan (" Executive ") is hereby amended and restated
on this th day
of April 2003 (the " Effective Date ") as
follows:
RECITALS
WHEREAS,
Executive is currently President and Chief Executive Officer of the
Company;
WHEREAS, The
Company and Executive are parties to the Prior Agreement dated as
of November 1, 2002 (the " Origination Date
");
WHEREAS, The
Company and Executive desire to amend and restate the Prior
Agreement to read as set forth in this agreement (the "
Agreement "). After the execution and delivery of
this Agreement the Prior Agreement shall have no further force or
effect;
WHEREAS, on
September 24, 1998, the Company and Executive entered into a
Loan Agreement (the " Loan Agreement ") which allowed
for maximum borrowings by Executive from the Company of up to an
aggregate principal amount of $480,000 (the " Loan
");
WHEREAS, as of
the Origination Date, the aggregate principal and interest amount
outstanding under the Loan was $180,000;
WHEREAS, the
Company's Board of Directors (the " Board ") believes
that it is in the best interests of the Company and its
stockholders to provide Executive with an incentive to continue his
employment with the Company; and
WHEREAS, in
order to provide Executive with enhanced financial security and
sufficient encouragement to remain with the Company, the Board
believes that it is imperative to provide Executive with certain
performance bonus opportunities and severance benefits upon
Executive's termination of employment,
NOW, THEREFORE,
based on the foregoing premises and in consideration of the
commitments set forth below, Executive and the Company agree as
follows:
1.
Duties and Scope of Employment
.
-
-
(a)
Positions and Duties . As of the Effective Date, Executive
will continue to serve as President and Chief Executive Officer of
the Company; provided, however, Executive will serve as Executive
Chairman of the Company if the Company hires a new Chief Executive
Officer following the Effective Date. Executive will render such
business and professional services in the performance of his
duties, consistent with Executive's position within the Company, as
shall reasonably be assigned to him by the Board. As Executive
Chairman, such duties will include, but not be limited to, shared
responsibility for the Company's high-level customer, partner and
industry relations, business development and strategic direction.
The period of Executive's employment under this Agreement is
referred to herein as the " Employment Term ."
(b)
Board Membership . During the Employment Term, Executive
will continue to serve as a member of the Board, subject to any
required Board and/or stockholder approval.
(c)
Obligations . During the Employment Term, Executive will
perform his duties faithfully and to the best of his ability and
will devote his full business efforts and time to the Company. For
the
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duration of the Employment Term, Executive agrees
not to actively engage in any other employment, occupation or
consulting activity for any direct or indirect remuneration without
the prior approval of the Board.
(d)
Loan Agreement . During the Employment Term, the Loan shall
continue to be governed by the terms and conditions of the Loan
Agreement. Executive agrees and acknowledges that he will not make
any additional loan draws under the Loan Agreement following the
Effective Date.
2.
At-Will Employment
. The parties agree that Executive's
employment with the Company will remain "at-will" employment and
may be terminated at any time with or without cause or notice.
Executive understands and agrees that neither his job performance
nor promotions, commendations, bonuses or the like from the Company
give rise to or in any way serve as the basis for modification,
amendment, or extension, by implication or otherwise, of his
employment with the Company.
3.
Compensation and Benefits
.
-
-
(a)
Base Salary . During the Employment Term, the Company will
pay Executive as compensation for his services a base salary at the
annualized rate of $195,000 (the " Base Salary "). The Base
Salary will be subject to annual review by the Board, will be paid
periodically in accordance with the Company's normal payroll
practices and be subject to the usual, required withholding.
(b)
Quarterly Bonuses . During each of the Company's fiscal
years during the Employment Term, Executive will be eligible to
receive quarterly bonuses based upon achievement of standard bonus
criteria established for other Company executives and dependent on
Executive's duties and responsibilities at the Company. Such bonus
opportunity shall be targeted at 15% of the Base Salary earned in
each applicable fiscal quarter and shall be paid within thirty
(30) days of the end of the applicable fiscal quarter.
Executive will also be entitled to participate in any other
management incentive programs that the Company provides to
similarly-situated executives.
(c)
Performance Bonus . In addition to the Base Salary and
contingent upon Executive remaining employed by the Company,
Executive shall receive a bonus payment of $5,000 per month in the
form of forgiveness of the Loan (the " Per Month Loan
Forgiveness ") for a period of three (3) years from
the Origination Date, subject to acceleration as provided in
Section 4 hereof.
(d)
Stock Option . Following the Effective Date, the Company
will recommend to the Board that Executive be granted a stock
option to purchase 2.5%, or 36,066,958 shares, of the Company's
fully-diluted shares of Common Stock (measured as of the Final
Closing (as defined in the Series A-1, A-2.1 and A-2.2
Preferred Stock Purchase Agreement dated October 29, 2002) of
the Company's Series A-1 Preferred Stock financing) at an
exercise price equal to the fair market value per share of the
Company's Common Stock on the date of grant (the "
Option "). Subject to the accelerated vesting
provisions set forth herein, the Option will vest as to 8,265,464
of the shares subject to the Option on March 31 st
, 2003, and as to 1 / 48
th of the shares subject to the Option
each month thereafter, subject to Executive's continued service to
the Company on the relevant vesting dates. The Option will be
subject to the terms, definitions and provisions of the Company's
Stock Plan (the " Stock Plan ") and the stock option
agreement by and between Executive and the Company (the " Option
Agreement "), both of which documents are incorporated herein
by reference.
(e)
Employee Benefits . During the Employment Term, Executive
will be entitled to continue to participate in the employee benefit
plans currently and hereafter maintained by the Company of general
applicability to other senior executives of the Company. The
Company reserves the right to cancel or change the benefit plans
and programs it offers to its employees at any time.
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4.
Severance
.
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(a)
Involuntary Termination During Severance Window . If, during
the "Severance Window" (as defined herein), Executive's employment
with the Company terminates for (i) "Good Reason" (as defined
herein) by Executive or (ii) other than for "Cause" (as
defined herein) by the Company, and Executive signs and does not
revoke a standard release of claims with the Company, then
(i) Executive shall b
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