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Exhibit
10.1
EXECUTION
COPY
TRANSITION
AGREEMENT
RECITALS
This Transition Agreement
(“Agreement”) is made by and between Phil Keenan
(“Employee”) and Polycom, Inc. (“Company”)
(jointly referred to as the “Parties”):
WHEREAS, Employee is employed
by the Company, pursuant to a letter agreement of
January 12,1998 between Employee and Accord Video
Telecommunications, as assumed by the Company on December 5,
2000 (the “Letter Agreement”);
WHEREAS, on June 27,
2007, the Company and Employee entered into a Proprietary
Information and Invention Agreement (the “Proprietary
Information Agreement”);
WHEREAS, on March 4,
2005, the Company and Employee entered into the Company’s
Indemnification Agreement (the “Indemnification
Agreement”);
WHEREAS, on
March 28,2001, the Company and Employee entered into a Change
of Control Severance Agreement (the “Change of Control
Agreement”), which was subsequently amended by the parties as
of May 10, 2006;
WHEREAS, the Company and
Employee have entered into certain written stock option agreements
to purchase common stock of the Company pursuant to certain Company
stock option plans (the “Stock Agreements”);
WHEREAS, the Company and
Employee have entered into certain written performance share
agreements to acquire common stock of the Company pursuant to
certain Company stock option plans(the “Performance
Agreements”);
WHEREAS, Employee will tender
his resignation from employment with the Company to be effective on
March 31, 2008, (the “Termination
Date”);
WHEREAS, after the execution
of this Agreement and before the Termination Date, Employee
acknowledges that his role with the Company will be Chief
Evangelist, reporting initially to Robert Hagerty and that such a
change in his duties will not constitute Good Reason under this
Agreement as such term is defined herein, or under any other
outstanding agreement, as such term is defined therein;
WHEREAS, the Parties wish to
resolve any and all disputes, claims, complaints, grievances,
charges, actions, petitions and demands that the Employee may have
against the Company as defined herein, including, but not limited
to, any and all claims arising out of, or related to,
Employee’s employment with, or separation from, the
Company;
NOW THEREFORE, in
consideration of the promises made herein, the Parties hereby agree
as follows:
COVENANTS
1.
Consideration.
(a) Transition Period.
Except as provided in Section 5 below, until the Termination
Date, the Company agrees to pay Employee his normal standard
compensation and benefits package, including the applicable
portion, of the annual incentive payment provided under the 2007
Management Bonus Plan, but only to the extent such incentive
payment is earned under the applicable provisions and performance
goals as pursuant to the 2007 Management Bonus Plan. Until the
Termination Date, except as specifically agreed herein, the Company
agrees not to change Employee’s title or demote Employee
without Cause (as defined in Section 6(c) below). The parties
acknowledge that in his role as Chief Evangelist, Employee will not
be an officer of the Company. In addition, the parties agree that
as of January 1, 2008, Employee will no longer report to
Robert Hagerty, but will instead report to the CMO of the Company
and his title and responsibility level will no longer be at the
vice president level in the Company, but at some lower
level.
(b) Resignation. On
the Termination Date, unless otherwise mutually agreed upon by the
parties, Employee will be deemed to have resigned voluntarily from
all Company positions held by him, without any further required
action by the Employee; provided however, if the Company requests,
Employee will execute any documents necessary to reflect his
resignation.
(c) Supplemental Release
Agreement. In consideration for the execution by Employee of a
Supplemental Separation Agreement and Release within ten
(10) business days after Employee’s Termination Date,
the form of which is attached hereto as Exhibit A (the
“Supplemental Agreement”), then as provided in the
Supplemental Agreement, the Company shall pay Employee the
consideration described in Section 2 of such Supplemental
Agreement in accordance with the terms and conditions
thereof.
2. Unemployment
Benefits. The Company agrees that Employee is entitled to apply
for unemployment benefits.
3. Stock. The terms of
the existing Performance Agreements and Stock Agreements including
the non-compete and non-solicit provisions thereof, shall continue
to govern the exercise and vesting of Employee’s options to
purchase common stock of the Company. If Employee has any questions
regarding his stock options, he may contact Stock Administration at
the Company.
4. Benefits.
Employee’s participation in all benefits and incidents of
employment (including the vesting of stock options and performance
shares) shall cease on the Termination Date. Employee will receive
payment of his accrued but unused vacation through the Termination
Date and, following his submission of proper expense reports, the
total unreimbursed amount of all expenses incurred by Employee in
connection with his employment with the Company that are
reimbursable in accordance with the Company’s
policies.
5. Termination of
Employment. This Agreement is intended to provide Employee with
the compensation, stock and benefits set out above for the full
duration of the transition period (i.e., through the Termination
Date). The Company shall in no event terminate Employee prior to
the
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Termination Date, other than for Cause.
For these purposes, a resignation by Employee for Good Reason shall
be a termination other than for Cause; provided however, Employee
acknowledges and agrees that any travel required for his position
does not invoke Good Reason.
(a) Termination for Cause
or Voluntary Termination without Good Reason prior to Termination
Date. If Employee’s employment is terminated by the
Company before the Termination Date, either for Cause or by
Employee without Good Reason, Employee will not receive any
compensation and benefits as contemplated under this Agreement and
the Supplemental Agreement.
(b) Cause. For
purposes of this Agreement, “Cause” means
(i) Employee’s continued failure to perform the duties
and responsibilities of his position (without regard to financial
milestones) that is not corrected within a thirty (30) day
correction period that begins upon delivery to Employee of a
written demand for performance from the Company that describes the
basis for the Company’s belief that Employee has not
substantially performed his duties; (ii) any act of personal
dishonesty taken by Employee in connection with his
responsibilities as an employee of the Company with the intention
or reasonable expectation that such may result in substantial
personal enrichment of Employee; (iii) Employee’s
conviction of, or plea of nolo contendre to, a felony that the
Company reasonably believes has had or will have a material
detrimental effect on the Company’s reputation or business,
or (iv) Employee materially breaching Employee’s
Proprietary Information Agreement, which breach is (if capable of
cure) not cured within thirty (30) days after the Company
delivers written notice to Employee of the breach.
(c) Good Reason. For
purposes of this Agreement, “Good Reason” means,
without the consent of the Employee, the Employee voluntarily
resigns following a (1) material reduction in the
Employee’s Base Salary; (2) material change in
Employee’s main office geographic location relative to
Employee’s current main office geographic location; or
(3) any other action or inaction that constitutes a material
breach of the terms of this Agreement. In addition, upon any such
voluntary termination the Employee must provide notice to the
Company of the existence of the one or more of the above Good
Reason conditions within 90 days of its initial existence and the
Company must be provided at least 30 days to remedy the
condition.
(d) Sole Right to
Severance Benefits. The Parties understand and acknowledge that
this Agreement and the Supplemental Agreement are intended to
represent Employee’s sole entitlement to severance payments
and benefits in connection with the termination of his employment.
To the extent Employee is entitled to receive severance payments or
benefits under any other Company program, including the Change of
Control Agreement, severance payments and benefits due Employee
under this Agreement and the Supplemental Agreement will be so
reduced so there will be no duplication of severance or
benefits.
6. Confidential
Information. Employee shall continue to comply with the terms
and conditions of the Proprietary Information Agreement, and
maintain the confidentiality of all of the Company’s
confidential and proprietary information. Employee shall also
return to the Company all of the Company’s property,
including all confidential and proprietary information, and all
documents and information that Employee obtained in connection with
his employment with the Company, on or before the Effective Date of
this Agreement.
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7. Payment of Salary.
Employee acknowledges and represents that the Company has paid all
salary, wages, bonuses, accrued vacation, paid time off, housing
allowances, relocation costs, interest, severance, stock, stock
options, outplacement costs, fees, commissions and any and all
other benefits and compensation due to Employee as of the Effective
Date.
8. Release of Claims.
Employee agrees that the foregoing consideration represents
settlement in full of all outstanding obligations owed to Employee
by the Company and its current and former officers, directors,
employees, agents, investors, attorneys, shareholders,
administrators, affiliates, divisions, subsidiaries, predecessor
and successor corporations and assigns (the
“Releasees”). Employee, on his own behalf, and on
behalf of his respective heirs, family members, executors, agents,
and assigns, hereby fully and forever releases the Company and the
other Releasees from, and agrees not to sue concerning, any claim,
duty, obligation or cause of action relating to any matters of any
kind, whether presently known or unknown, suspected or unsuspected,
that Employee may possess arising from any omissions, acts or facts
that have occurred up until and including the Effective Date of
this Agreement including, without limitation:
(a) any and all claims
relating to or arising from Employee’s employment with the
Company, or the termination of that employment;
(b) any and all claims
relating to, or arising from, Employee’s right to purchase,
or actual purchase of, shares of Company stock, including, but not
limited to, any claims for fraud, misrepresentation, breach of
fiduciary duty, breach of duty under applicable state corporate
law, and securities fraud under any state or federal
law;
(c) any and all claims under
the law of any jurisdiction, including, but not limited to,
wrongful discharge of employment; constructive discharge from
employment; termination in violation of public policy;
discrimination; breach of contract, both express and implied;
breach of a covenant of good faith and fair dealing, both express
and implied; promissory estoppel; negligent or intentional
infliction of emotional distress; negligent or intentional
misrepresentation; negligent or intentional interference with
contract or prospective economic advantage; unfair business
practices; defamation; libel; slander; negligence; personal injury;
assault; battery; invasion of privacy; false imprisonment; and
conversion;
(d) any and all claims for
violation of any federal, state or municipal statute, including,
but not limited to, Title VII of the Civil Rights Act of 1964; the
Civil Rights Act of 1991; the Age Discrimination in Employment Act
of 1967; the Americans with Disabilities Act of 1990; the Fair
Labor Standards Act; the Employee Retirement Income Security Act of
1974; the Worker Adjustment and Retraining Notification Act; the
Older Workers Benefit Protection Act; the Family and Medical Leave
Act; the Fair Credit Reporting Act; the California Family Rights
Act; the California Fair Employment and Housing Act; and the
California Labor Code;
(e) any and all claims for
violation of the federal, or any state, constitution;
(f) any and all claims
arising out of any other laws and regulations relating to
employment or employment discrimination;
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(g) any claim for any loss,
cost, damage, or expense arising out of any dispute over the
non-withholding or other tax treatment of any of the proceeds
received by Employee as a result of this Agreement; and
(h) any and all claims for
attorney fees and costs.
The Company agrees to and
does hereby generally release and forever discharge Employee from
any known claims that the Company may possess against Employee
arising from any omissions, acts or facts, and the Company agrees
not to sue concerning any known claim, duty, obligation or cause of
action relating to any matters of any kind that have occurred up to
and including the Effective Date of this Agreement. The Company
also agrees to generally release and forever discharge Employee
from any unknown claims that the Company may possess against
Employee arising from any omissions, acts or facts, but only for
such unknown claims that Employee would be entitled to
indemnification under the Indemnification Agreement. This release
does not extend to any obligations incurred under this
Agreement.
The Company and Employee
agree that the releases set forth in this section shall be and
remain in effect in all respects as a complete general release as
to the matters released. The releases do not extend to any
obligations incurred under this Agreement.
9. Acknowledgment of
Waiver of Claims under ADEA. Employee acknowledges that he is
waiving and releasing any rights he may have under the Age
Discrimination in Employment Act of 1967 (“ADEA”) and
that this waiver and release is knowing and voluntary. Employee and
the Company agree that this waiver and release does not apply to
any rights or claims that may arise under the ADEA after the
Effective Date of this Agreement. Employee acknowledges that the
consideration given for this waiver and release Agreement is in
addition to anything of value to which Employee was already
entitled. Employee further acknowledges that he has been advised by
this writing that (a) he should consult with an attorney
prior to executing this Agreement; (b) he has
forty-five (45) days within which to consider this Agreement;
(c) he has seven (7) days following the execution of this
Agreement by the parties to revoke the Agreement; and (d) this
Agreement will not be effective until the revocation period has
expired. Any revocation should be in writing and delivered to the
Chief Financial Officer at Polycom by close of business on the
seventh day from the date that Employee signs this
Agreement.
10. Civil Code
Section 1542. Employee represents that he is not aware of
any claims against the Company other than the claims that are
released by this Agreement. Employee acknowledges that he has been
advised by legal counsel and is familiar with the provisions of
California Civil Code Section 1542, or any similar provision
of Georgia law, which provides as follows:
A GENERAL RELEASE DOES NOT
EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR.
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Employee, being aware of said
code section, agrees to expressly waive any rights he may have
thereunder, as well as under any other statute or common law
principles of similar effect.
11. No Pending or Future
Lawsuits. Each Party represents that it has no lawsuits,
claims, or actions pending in its name, or on behalf of any other
person or entity, against the other Party. Each Party also
represents that it does not intend to bring any claims on its own
behalf or on behalf of any other person or entity against the other
Party.
12. Application for
Employment. Employee understands and agrees that, as a
condition of this Agreement, as of the Termination Date, he shall
not be entitled to any employment with the Company, its
subsidiaries, or any successor, and he hereby waives any alleged
right of employment or re-employment with the Company, its
subsidiaries or related companies, or any successor.
13. Confidentiality.
Employee agrees to use his best efforts to maintain in confidence
the contents and terms of this Agreement, (to the extent not
otherwise disclosed by the Company), including the consideration
for this Agreement (hereinafter collectively referred to as
“Settlement Information”). Employee agrees to take
every reasonable precaution to prevent disclosure of any Settlement
Information to third parties, and agrees that there will be no
publicity, directly or indirectly, concerning any Settlement
Information. Employee is permitted to take every precaution to
disclose Settlement Information only to those attorneys,
accountants, governmental entities, and family members who have a
reasonable need to know of such Settlement Information. The Parties
agree that if the Company proves that Employee breached this
confidentiality provision, the Company shall be entitled to an
award of its costs spent enforcing this provision, including all
reasonable attorney fees associated with the enforcement action,
without regard to whether the Company can establish actual damages
from Employee’s breach.
14. No Cooperation.
Employee agrees that he will not act in any manner that might
damage the business of the Company. The Parties acknowledge that
Employee’s employment with any of the Company’s
competitors shall not, in and of itself,
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