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EXHIBIT 10.28.1
EXECUTIVE OFFICER CHANGE IN CONTROL AGREEMENT
THIS AGREEMENT dated June 19, 2000 is made by and between PictureTel
Corporation, a Delaware Corporation, (the "Company") and Xxxxx Xxxxx, 00 Xxxxxx
Xxxx, Xxxxxxxxxx, XX 00000 ("Executive").
WHEREAS the Company considers it essential to the best interests of the
Company, its shareholders, and its employees generally to xxxxxx the continuous
employment of key management personnel; and
WHEREAS the Board of Directors of the Company (the "Board") recognizes
that, as is the case with many publicly held corporations, the possibility of a
Change in Control (as defined in the last Section hereof) exists and that such
possibility, and the uncertainty and questions that it may raise among the
Company's management, may result in the departure or distraction of management
personnel to the detriment of the Company and its shareholders; and
WHEREAS the Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of members of the
Company's management, including the Executive, to their assigned duties without
distraction in the face of potentially DISRUPTING circumstances arising from the
possibility of a Change in Control;
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained and other good and valuable consideration, the Company and the
Executive hereby agree as follows:
1.0 DEFINED TERMS. The definition of capitalized terms used in this
Agreement is provided in the last Section hereof.
2.0 TERM OF AGREEMENT. This Agreement shall commence on the date hereof and
shall continue in effect through December 31, 2001; provided, however, that
commencing on December 1, 2000 and each December 1st thereafter, the term of
this Agreement shall automatically be extended for one additional year unless,
not later than September 30th preceding that December 1st, the Company or the
Executive shall have given notice not to extend this Agreement or a Change in
Control shall have occurred prior to such September 30th; provided, however, if
a Change in Control shall have occurred during the term of this Agreement, this
Agreement shall continue in effect for a period of not less than thirty-six (36)
months beyond the date such Change in Control occurred.
3.0 COMPANY'S COVENANTS SUMMARIZED. In order to induce the Executive to
remain in the employ of the Company and in consideration of the Executive's
covenants set forth in Section 4.0 hereof, the Company agrees, under the
conditions described herein, to pay the Executive the "Severance Payments"
described in Section 6.1 hereof and the other payments and benefits described
herein in the event the Executive's employment with the Company is terminated
following a Change in Control and during the term of this Agreement. No amount
or benefit shall be payable under this Agreement unless there shall have been
(or, under the terms hereof, there shall be deemed to have been) a termination
of the Executive's employment with the Company following a Change in Control.
This Agreement shall not be construed as creating an express or implied contract
of employment prior to the date of a Change in Control and, except as otherwise
agreed in writing between the Executive and the Company, including the
Employment Agreement dated November 9, 1999, the Executive shall not have any
right to be retained in the employ of the Company.
4.0 THE EXECUTIVE'S COVENANTS. The Executive agrees that, subject to the
terms and conditions of this Agreement, in the event of a Potential Change in
Control during the term of this Agreement, the Executive will remain in the
employ of the Company until the earliest of (A) a date which is six (6) months
from the date of such Potential Change of Control, (B) the date of a Change in
Control, (C) the date of termination by the Executive of the Executive's
employment for Good Reason (determined by treating the Potential Change in
Control as a Change in Control in applying the definition of Good Reason), by
reason of death or Disability, or (D) the termination by the Company of the
Executive's employment for any reason.
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5.0 COMPENSATION OTHER THAN SEVERANCE PAYMENTS.
5.1 Following a Change in Control during the term of this Agreement, during
any period that the Executive fails to perform the Executive's full-time duties
with the Company as a result of incapacity due to physical or mental illness,
the Company shall pay the Executive's full salary to the Executive at the rate
in effect at the commencement of any such period, together with all compensation
and benefits payable to the Executive under the terms of any compensation or
benefit plan, program or arrangement maintained by the Company during such
period, until the Executive's employment is terminated by the Company for
Disability.
5.2 If the Executive's employment shall be terminated for any reason
following a Change in Control during the term of this Agreement, the Company
shall pay the Executive's full salary to the Executive through the Date of
Termination at the rate in effect at the time the Notice of Termination is
given, together with all compensation and benefits payable to the Executive
through the Date of Termination under the terms of any compensation or benefit
plan, program or arrangement maintained by the Company prior to the Date of
Termination.
5.3 If the Executive's employment shall be terminated for any reason
following a Change in Control during the term of this Agreement, the Company
shall pay the Executive's normal post-termination compensation and benefits to
the Executive as such payments become due. Such post-termination compensation
and benefits shall be determined under, and paid in accordance with, the
Company's retirement, insurance and other compensation or benefit plans,
programs and arrangements; provided however, that the Severance Payments under
Section 6.0 of this Agreement shall be the only severance paid following a
Change in Control during the term of this Agreement.
6.0 SEVERANCE PAYMENTS.
6.1 Subject to Section 6.2 hereof, the Company shall pay the Executive the
payments described in this Section 6.1 ("Severance Payments") upon the
termination of the Executive's employment following a Change in Control during
the term of this Agreement, in addition to the payments and benefits described
in Section 5.0 hereof, unless such termination is (A) by the Company for Cause,
(B) by reason of death or Disability, or (C) by the Executive without Good
Reason. The Executive's employment shall be deemed to have been terminated
following a Change in Control by the Company without Cause or by the Executive
with Good Reason if the Executive's employment is terminated prior to a Change
in Control without Cause at the direction (or action which constitutes a
direction) of a Person who has entered into an agreement with the Company the
consummation of which will constitute a Change in Control or if the Executive
terminates his employment with Good Reason prior to a Change in Control
(determined by treating a Potential Change in Control as a Change in Control in
applying the definition of Good Reason) if the circumstance or event which
constitutes Good Reason occurs at the direction (or action which constitutes a
direction) of such Person.
(i) Subsequent to the Date of Termination, the Company shall make cash
severance payments to the Executive over a twenty-four (24) month period in
substantially equal bi-weekly installments, in an amount equal to two (2)
times the sum of (a) the higher of the Executive's annual base salary in
effect immediately prior to the occurrence of the event or circumstance
upon which the Notice of Termination is based or in effect immediately
prior to the Change in Control, and (b) the higher of the highest annual
bonus paid to the Executive in the three years preceding the year in which
the Date of Termination occurs or paid in the three years preceding the
year in which the Change in Control occurs.
(ii) For a twenty-four (24) month period after the Date of Termination, the
Company shall arrange to provide the Executive with medical and dental
insurance benefits substantially similar to those which the Executive is
receiving immediately prior to the Notice of Termination (without giving
effect to any reduction in such benefits subsequent to a Change in Control
which reduction constitutes Good Reason). Benefits otherwise receivable by
the Executive pursuant to this Section 6.1(ii) shall be reduced to the
extent comparable benefits are actually received by or made available to
the Executive without cost during the twenty-four (24) month period
following the Executive's termination of employment (and any such benefits
actually received by the Executive shall be reported to the Company by the
Executive). If the benefits provided to the Executive under this Section
6.1(ii) shall result in a decrease, pursuant to Section 6.2, in the Change
in Control Payments and these Section 6.1(ii) benefits are thereafter
reduced pursuant to the immediately preceding sentence because of the
receipt of comparable benefits, the Company shall, at the time of such
reduction, pay to the Executive the lesser of (a) the amount of the
decrease made in the Severance Payments pursuant to Section 6.2, or (b) the
maximum amount which can be paid to the
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Executive without being, or causing any other payment to be, nondeductible
by reason of section 28OG of the Code.
6.2 Notwithstanding any other provisions of this Agreement, in the event
that any payment or benefit received or to be received by the Executive in
connection with a Change in Control or the termination of the Executive' s
employment (whether or not received pursuant to the terms of this Agreement)
(all such payments and benefits, including but not limited to the Severance
Payments, being hereinafter called the "Total Payments") would be subject in
whole or in part to the Excise Tax, then the Severance Payments shall be reduced
to the extent, but only to the extent, necessary so that no portion of the Total
Payments is subject to the Excise Tax; provided, that no such reduction shall be
effected unless the net amount of the Total Payments after such reduction in the
Severance Payments and after deduction of the net amount of federal, state and
local income taxes on such reduced Total Payments would be greater than the
excess of (a) the net amount of the Total Payments without such reduction in the
Severance Payments but after deduction of the net amount of federal, state and
local income taxes (other than the Excise Tax) on such unreduced Total Payments,
over (b) the Excise Tax to which the Total Payments are subject. The
determination as to whether a reduction in Severance Payments is to be made
under this Section 6.2 and, if so, the amount of any such reduction shall be
made by the Company's auditors or by such other firm of certified public
accountants, benefits consulting firm or legal counsel as the Board may
designate prior to the Change in Control.
The Company shall provide the executive with its calculations of the
amounts referred to in this Section 6.2 and such supporting materials as are
reasonably necessary for the Executive to evaluate the Company's calculations.
6.3 The Company also shall pay to the Executive all legal fees and expenses
incurred by the Executive as a result of a termination which entitles the
Executive to the Severance Payments (including all such fees and expenses, if
any, incurred in disputing any such termination or in seeking in good faith to
obtain or enforce any benefit or right provided by this Agreement or in
connection with any tax audit or proceeding to the extent attributable to the
application of section 4999 of the Code to any payment or benefit provided
hereunder). Such payments shall be made within five (5) business days after
delivery of the Executive's written requests for payment accompanied with such
evidence of fees and expenses incurred as the Company reasonably may require.
7.0 TERMINATION PROCEDURES AND COMPENSATION DURING DISPUTE.
7.1 NOTICE OF TERMINATION. After a Change in Control and during the term of
this Agreement, any purported termination of the Executive's employment (other
than by reason of death) shall be communicated by written Notice of Termination
from one party hereto to the other party hereto in accordance with Section 10.0
hereof. For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated. Further, a Notice of Termination for Cause is
required to include a copy of a resolution duly adopted by the affirmative vote
of not less than three-quarters (3/4) of the entire membership of the Board at a
meeting of the Board which was called and held for the purpose of considering
such termination (after reasonable notice to the Executive and an opportunity
for the Executive, together with the Executive's counsel, to be heard before the
Board) finding that, in the good faith opinion of the Board, the Executive was
guilty of conduct set forth in clause (i) or (ii) of the definition of Cause
herein, and specifying the particulars thereof in detail.
7.2 DATE OF TERMINATION. "Date of Termination", with respect to any
purported termination of the Executive's employment after a Change in Control
during the term of this Agreement, shall mean:
(A) If the Executive's employment is terminated for Disability, thirty (30)
days after Notice of Termination is given (provided that the Executive
shall not have returned to the full-time performance of the Executive's
duties during such thirty (30) day period), and
(B) If the Executive's employment is terminated for any other reason, the
date specified in the Notice of Termination (which, in the case of a
termination by the Company, shall not be less than thirty (30) days (except
in the case of a termination for Cause) and, in the case of a termination
by the Executive, shall not be less than fifteen (15) days nor more than
sixty (60) days, respectively, from the date such Notice of Termination is
given).
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7.3 DISPUTE CONCERNING TERMINATION. If within fifteen (15) days after any
Notice of Termination is given, or, if later, prior to the Date of Termination
(as determined without regard to this Section 7.3), the party receiving such
Notice of Termination notifies the other party that a dispute exists concerning
the termination, the Date of Termination shall be the date on which the dispute
is finally resolved, either by mutual written agreement of the parties, by
arbitrator's award, or, to the extent permitted by Section 14.0, by a final
judgment, order or decree of a court of competent jurisdiction on the
arbitrator's award (which is not appealable or with respect to which the time
for appeal therefrom has expired and no appeal has been perfected); provided
further that the Date of Termination shall be extended by a notice of dispute
only if such notice is given in good faith and the party giving such notice
pursues the resolution of such dispute with reasonable diligence.
7.4 COMPENSATION DURING DISPUTE. If a purported termination occurs
following a Change in Control and during the term of this Agreement and such
termination is disputed in accordance with Section 7.3 hereof, the Company shall
continue to pay the Executive the full compensation in effect when the notice
giving rise to the dispute was given (including, but not limited to, salary) and
continue the Executive as a participant in all compensation, benefit and
insurance plans in which the Executive was participating when the notice giving
rise to the dispute was given, until the dispute is finally resolved in
accordance with Section 7.3 hereof. Amounts paid under this Section 7.4 are in
addition to all other amounts due under this Agreement (other than those due
under Section 5.2 hereof) and shall not be offset against or reduce any other
amounts due under this Agreement.
8.0 NO MITIGATION. The Company agrees that, if the Executive's employment
by the Company is terminated during the term of this Agreement, the Executive is
not required to seek other employment or to attempt in any way to reduce any
amounts payable to the Executive by the Company pursuant to Section 6.0 or
Section 7.4. Further, the amount of any payment or benefit provided for in
Section 6.0 (other than Section 6.1(ii)) or Section 7.4 shall not be reduced by
any compensation earned by the Executive as the result of employment by another
employer, by retirement benefits, by offset against any amount claimed to be
owed by the Executive to the Company, or otherwise.
9.0 SUCCESSORS; BINDING AGREEMENT.
9.1 In addition to any obligations imposed by law upon any successor to the
Company, the Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and / or assets of the Company to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle the
Executive to compensation from the Company in the same amount and on the same
terms as the Executive would be entitled to hereunder if the Executive were to
terminate the Executive's employment for Good Reason after a Change in Control,
except that, for purposes of implementing the foregoing, the date on which any
such succession becomes effective shall be deemed the Date of Termination. In
any event this agreement shall be binding upon the Company and any successors or
assignee.
9.2 This Agreement shall inure to the benefit of and be enforceable by the
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive shall
die while any amount would still be payable to the Executive hereunder (other
than amounts which, by their terms, terminate upon the death of the Executive)
if the Executive had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Agreement to
the executors, personal representatives or administrators of the Executive's
estate.
10.0 NOTICES. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered in hand or when delivered or
mailed by United States certified mail, return receipt requested, postage
prepaid, addressed to the respective addresses set forth below, or to such other
address as either party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only upon
actual receipt:
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To the Company:
PictureTel Corporation
000 Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
To the Executive:
Xxxxx Xxxxx
00 Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
11.0 MISCELLANEOUS. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing and signed by the Executive and such officer as may be specifically
designated by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not expressly set forth in this Agreement. The laws of
the Commonwealth of Massachusetts shall govern the validity, interpretation,
construction and performance of this Agreement and the Agreement shall be an
instrument under seal. All references to sections of the Exchange Act or the
Code shall be deemed also to refer to any successor provisions to such sections.
Any payments provided for hereunder shall be paid net of any applicable
withholding required under federal, state or local law and any additional
withholding to which the Executive has agreed. The obligations of the Company
and the Executive under Sections 6.0, 7.0, 8.0 and 14.0 shall survive the
expiration of the term of this Agreement.
12.0 VALIDITY. The invalidity or unenforceability or any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect. In addition, if
any provision of this Agreement is held invalid or unenforceable by a court of
competent jurisdiction, then such provision shall be deemed modified to the
extent necessary to enable such provision to be valid and enforceable.
13.0 COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
14.0 SETTLEMENT OF DISPUTES; ARBITRATION. All claims by the Executive for
benefits under this Agreement shall be directed to the Board and shall be in
writing. Any denial by the Board of a claim for benefits under this Agreement
shall be delivered to the Executive in writing and shall set forth the specific
reasons for the denial and the specific provisions of this Agreement relied
upon. The Board then shall afford a reasonable opportunity to the Executive for
a review of the decision denying a claim and shall further allow the Executive
to appeal to the Board a decision of the Board within sixty (60) days after
notification by the Board that the Executive's claim has been denied. Any
further dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration in Boston, Massachusetts
in accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any court having
jurisdiction; provided, however, that the Executive shall be entitled to seek
specific performance of the Executive's right to be paid until the Date of
Termination during the pendency of any dispute or controversy arising under or
in connection with this Agreement in such arbitration or by a proceeding in the
federal court in Boston or the Massachusetts state court in Essex County.
15.0 DEFINITIONS. For purposes of this Agreement, the following terms shall
have the meanings indicated below:
(A) "Base Amount" shall have the meaning defined in section 28OG(b)(3) of
the Code.
(B) "Beneficial Owner" shall have the meaning defined in Rule 13d-3 under
the Exchange Act.
(C) "Board" shall mean the Board of Directors of the Company.
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(D) "Cause" for termination by the Company of the Executive's employment,
after any Change in Control, shall mean:
(i) the willful and continued failure by the Executive to
substantially perform the Executive's duties with the Company (other
than any such failure resulting from the Executive's incapacity due to
physical or mental illness or any such actual or anticipated failure
after the issuance of a Notice of Termination for Good Reason by the
Executive pursuant to Section 7.1) after a written demand for
substantial performance is delivered to the Executive by the Board,
which demand specifically identifies the manner in which the Board
believes that the Executive has not substantially performed the
Executive's duties, or
(ii)the willful engaging by the Executive in conduct which is
demonstrably and materially injurious to the Company or its
subsidiaries, monetarily or otherwise.
For purposes of clauses (i) and (ii) of this definition, no act, or failure
to act, on the Executive's part shall be deemed "Willful" unless done, or
omitted to be done, by the Executive not in good faith and without
reasonable belief that the Executive's act, or failure to act, was in the
best interest of the Company.
(E) A "Change in Control", shall be deemed to have occurred if the
conditions set forth in any one of the following paragraphs shall have been
satisfied:
(i) any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing twenty-five (25)
percent or more of the combined voting power of the Company's then
outstanding securities; or
(ii)during any period of not more than two consecutive years (not
including any period prior to the execution of this Agreement),
individuals who at the beginning of such period constitute the Board
and any new director (other than a director designated by a Person who
has entered into an agreement with the Company to effect a transaction
described in clause (i), (ii) or (iii) of this Section 15(E)) whose
election by the Board or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election
was previously so approved, cease for any reason to constitute a
majority thereof; or
(iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than
(a) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) sixty (60)
percent or more of the combined voting power of the voting securities
of the Company or such surviving entity outstanding immediately after
such merger or consolidation, or (b) a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no Person acquires twenty-five (25) percent or
more of the combined voting power of the Company's then outstanding
securities; or
(iv)the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all the Company's assets.
(F) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
(G) "Company" shall mean PictureTel Corporation and any successor to its
business and/or assets which assumes and agrees to perform this Agreement
by operation of law, or otherwise (except in determining, under Section
15(E) hereof, whether or not any Change in Control of the Company has
occurred in connection with such succession).
(H) "Date of Termination" shall have the meaning stated in Section 7.2
hereof.
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(I) "Disability" shall be deemed the reason for the termination by the
Company of the Executive's employment, if, as a result of the Executive's
incapacity due to physical or mental illness, the Executive shall have been
absent from the full-time performance of the Executive's duties with the
Company for a period of six (6) consecutive months, the Company shall have
given the Executive a Notice of Termination for Disability, and, within
thirty (30) days after such Notice of Termination is given, the Executive
shall not have returned to the full-time performance of the Executive's
duties.
(J) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
(K) "Excise Tax" shall mean any excise tax imposed under section 4999 of
the Code.
(L) "Executive" shall mean the individual named in the first paragraph of
this Agreement.
(M) "Good Reason" for termination by the Executive of the Executive's
employment shall mean the occurrence (without the Executive's express
written consent) of any one of the following acts by the Company, or
failures by the Company to act, unless, in the case of any act or failure
to act described in paragraph (i), (v), (vi), or (vii), below, such act or
failure to act is corrected prior to the Date of Termination specified in
the Notice of Termination given in respect thereof:
(i) the assignment to the Executive of any duties inconsistent with
the Executive's status as a senior executive officer of the Company or
a substantial adverse alteration in the nature or status of the
Executive's responsibilities from those in effect immediately prior to
the Change in Control;
(ii) a reduction by the Company in the Executive's annual base salary
as in effect on the date hereof or as the same may be increased from
time to time;
(iii) the relocation of the Company's principal executive offices to a
location more than thirty (30) miles] from the location of such
offices immediately prior to the Change in Control or the Company's
requiring the Executive to be based anywhere other than the Company's
principal executive offices, except for required travel on the
Company's business to an extent substantially consistent with the
Executive's present business travel obligations;
(iv)the failure by the Company, without the Executive's consent, to
pay to the Executive any portion of the Executive's current
compensation, or to pay to the Executive any portion of an installment
of deferred compensation under any deferred compensation program of
the Company, within seven (7) days of the date such compensation is
due;
(v) the failure by the Company to continue in effect any compensation
plan in which the Executive participates immediately prior to the
Change in Control which is material to the Executive's total
compensation, including but not limited to the Company's Equity
Incentive Plan and Employee Stock Purchase Plan or any substitute
plans adopted prior to the Change in Control, unless an equitable
arrangement (embodied in an ongoing substitute or alternative plan)
has been made with respect to such plan, or the failure by the Company
to continue the Executive's participation therein (or in such
substitute or alternative plan) on a basis not materially less
favorable, both in terms of the amount of benefits provided and the
level of the Executive's participation relative to other participants,
as existed at the time of the Change in Control;
(vi)the failure by the Company to continue to provide the Executive
with benefits substantially similar to those enjoyed by the Executive
under any of the Company's pension, life insurance, medical, health
and accident, or disability plans in which the Executive was
participating at the time of the Change in Control, the taking of any
action by the Company which would directly or indirectly materially
reduce any of such benefits or deprive the Executive of any material
fringe benefit enjoyed by the Executive at the time of the Change in
Control, or the failure by the Company to provide the Executive with
the number of paid vacation days to which the Executive is entitled on
the basis of years of service with the Company in accordance with the
Company's normal vacation policy in effect at the time of the Change
in Control; or
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(vii) any purported termination of the Executive's employment that is
not effected pursuant to a Notice of Termination satisfying the
requirements of Section 7.1; for purposes of this Agreement, no such
purported termination shall be effective.
The Executive's right to terminate the Executive's employment for Good
Reason shall not be affected by the Executive's incapacity due to
physical or mental illness. The Executive's continued employment shall
not constitute consent to, or a waiver of rights with respect to, any
act or failure to act constituting Good Reason hereunder.
(N) "Notice of Termination" shall have the meaning stated in Section 7.1
hereof.
(O) "Person" shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof;
however, a Person shall not include:
(i) the Company,
(ii)a trustee or other fiduciary holding securities under an employee
benefit plan of the Company, or
(iii) a Corporation owned, directly or indirectly, by the stockholders
of the Company in substantially the same proportions as their
ownership of stock of the Company.
(P) "Potential Change in Control', shall be deemed to have occurred if the
conditions set forth in any one of the following paragraphs shall have been
satisfied:
(i) the Company enters into an agreement, the consummation of which
would result in the occurrence of a Change in Control;
(ii)the Company or any Person publicly announces an intention to take
or to consider taking actions which, if consummated, would constitute
a Change in Control;
(iii) the Board adopts a resolution to the effect that, for purposes
of this Agreement, a Potential Change in Control has occurred.
(Q) "Severance Payments" shall mean those payments described in Section 6.1
hereof.
(R) "Total Payments" shall mean those payments described in Section 6.2
hereof.
PictureTel Corporation
By
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Name: Xxxxxx X. Xxxx
Title: Chairman of the Board of
Directors, President and
Chief Executive Officer
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Xxxxx Xxxxx
