EXHIBIT 10.41.1
CHOLESTECH CORPORATION
FIRST AMENDMENT TO
CHANGE OF CONTROL SEVERANCE AGREEMENT
This First Amendment to the Change of Control Severance Agreement dated
as of June 14, 2001 (the "Agreement"), is made as of January 23, 2003 (the
"Amendment"), by and between Cholestech Corporation, a California corporation
(the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇ (the "Employee").
WHEREAS, the Company and the Employee desire to amend Section 1(d) and
Section 6 of the Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises set forth herein, the Company and the Employee agree as follows:
1. Section 1(d) is hereby amended to read in its entirety as
follows:
"Involuntary Termination. "Involuntary Termination" shall mean (i) the
failure of an acquiring corporation to offer the Employee the position of Chief
Executive Officer of the acquiring corporation following a Change of Control;
(ii) without the Employee's express written consent, a substantial reduction,
without good business reasons, of the facilities and perquisites (including
office space and location) available to the Employee immediately prior to such
reduction; (iii) without the Employee's express written consent, a reduction by
the Company of the Employee's base salary or target bonus as in effect
immediately prior to such reduction; (iv) without the Employee's express written
consent, a material reduction by the Company in the kind or level of employee
benefits to which the Employee is entitled immediately prior to such reduction
with the result that the Employee's overall benefits package is significantly
reduced; (v) without the Employee's express written consent, the relocation of
the Employee to a facility or a location more than fifty (50) miles from his
current location; (vi) any purported termination of the Employee by the Company
which is not effected for Cause or for which the grounds relied upon are not
valid; or (vii) the failure of the Company to obtain the assumption of this
Agreement by any successors contemplated in Section 7 below."
2. Section 6 is hereby amended to read in its entirety as
follows:
"Golden Parachute Excise Tax. In the event that the benefits provided
for in this Agreement or otherwise payable to the Employee constitute "parachute
payments" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code") that are subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then the Employee shall receive (i)
a one-time payment from the Company sufficient to pay such excise tax (the
"Excise Tax Gross-Up"), and (ii) an additional one-time payment from the Company
sufficient to pay the additional excise tax and federal and state income taxes
arising from the Excise Tax Gross-Up made by the Company to the Employee
pursuant to this Section (the "Additional Gross-Up"); provided, however, that
the Company shall only pay the Excise Tax Gross-Up and Additional Gross-Up if
the cumulative value of such payments to the Employee equals or exceeds $10,000.
In the event that such payments to the Employee is less than $10,000, then the
Employee's benefits hereunder shall
be either (x) delivered in full, or (y) delivered as to such lesser extent which
would result in no portion of such severance benefits being subject to the
Excise Tax, whichever of the foregoing amounts, taking into account the
applicable federal, state and local income and employment taxes and the Excise
Tax, results in the receipt by the Employee on an after-tax basis, of the
greatest amount of severance benefits, notwithstanding that all or some portion
of such benefits may be taxable under the Excise Tax. Unless the Company and the
Employee otherwise agree in writing, the determination of the Employee's excise
tax liability and the amount required to be paid under this Section 6 shall be
made in writing in good faith by the accounting firm serving as the Company's
independent public accountants immediately prior to the Change of Control (the
"Accountants"). In the event that the Excise Tax incurred by the Employee is
determined by the Internal Revenue Service to be greater or lesser than the
amount so determined by the Accountants, the Company and the Employee agree to
promptly make such additional payment, including interest and any tax penalties,
to the other party as the Accountants reasonably determine is appropriate. For
purposes of making the calculations required by this Section 6, the Accountants
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on interpretations concerning the application of the Code for which
there is a "substantial authority" tax reporting position. The Company and the
Employee shall furnish to the Accountants such information and documents as the
Accountants may reasonably request in order to make a determination under this
Section 6. The Company shall bear all costs the Accountants may reasonably incur
in connection with any calculations contemplated by this Section 6."
3. Except as amended as set forth above, the Agreement shall
continue in full force and effect and the parties thereto shall continue to
enjoy and be bound by all of their rights and obligations thereunder.
4. This Amendment shall be governed by and construed in
accordance with the laws of the State of California, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
5. This Amendment may be executed in one or more counterparts,
all of which shall be considered one and the same amendment, and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other party, it being understood that all parties need not
sign the same counterpart.
6. Capitalized terms not otherwise defined in this Amendment
shall have the meanings ascribed to them in the Agreement.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
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IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment to the Change of Control Severance Agreement as of the day and year
first above written.
CHOLESTECH CORPORATION
a California corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇
Chairman of the Board of Directors
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇
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