Exhibit 10.1

 

SEVERANCE AGREEMENT AND RELEASE

 

Re: Yves Audebert and ActivIdentity Corporation

 

I, Yves Audebert (“Executive”) acknowledge that my employment with Activldentity
Corporation and its affiliates and subsidiaries (collectively, the “Company”)
terminated effective on November 14, 2008 (the “Separation Date”). This
Severance Agreement and Release (the “Release”) is in consideration of the
commitments made by the parties released hereby, all of which commitments are
set forth in this document.

 

Subject to the effectiveness of this Release pursuant to Section 10, the Company
agrees for the benefit of Executive:

 

1.             To pay a total of $142,500, equal to six months base salary,
which will be paid by wire transfer within three days following the
effectiveness of the Release (the “Severance Pay”), as described in Section l0
below.

 

The Company will also:

 

(i)            Pay to the Executive by wire transfer within three days following
the effectiveness of the Release an amount equal to $53,437.50 in satisfaction
of the Executive’s incentive bonus compensation for the calendar year 2008;

 

(ii)           Pay to the Executive by wire transfer within three days following
the effectiveness of the Release an amount equal to $12,056.88 in satisfaction
of waiting time penalties incurred for late payment of the Executive’s final
wages and accrued vacation;

 

(iii)          if Executive elects COBRA continuation coverage and provided that
Executive and Executive’s dependents remain eligible for COBRA continuation
coverage, the Company shall continue to pay for medical and dental insurance
premiums for coverage of Executive and Executive’s eligible dependents to the
same extent as if Executive remained employed until the earlier of (x) eighteen
(18) months from the Separation Date and (y) the date that Executive first
becomes eligible to receive such benefits through a new employer, and the
Executive is required to notify ActivIdentity when he becomes eligible to
receive such benefits through a new employer; provided, however, that if, during
the period of continuation coverage, any plan pursuant to which such benefits
are provided ceases to be exempt from the application of Section 409A of the
Internal Revenue Code of 1986, as amended (“Section 409A”) under Treasury
Regulation Section 1.409A-1(a)(5), then an amount equal to each such remaining
premium shall thereafter be paid to the Executive as currently taxable
compensation in substantially equal monthly installments over the remainder of
the continuation coverage period; or if such healthcare benefits are to be
provided in whole or in part through a self-funded plan, the benefits of which
are not fully-insured by a third-party insurer:

 

1

--------------------------------------------------------------------------------

 

(A) to the greatest extent applicable, such healthcare benefits shall be
construed to satisfy the exemption from Section 409A pursuant to Treasury
Regulation Section 1.409A-1(b)(9)(v)(B), and

 

(B) to the extent such healthcare benefits do not satisfy such exemption and/or
extend beyond the COBRA continuation period, determine, as of the date of the
Executive’s Separation from Service, the amount (the “Section 409A Healthcare
Coverage Payment”) equal to (x) the aggregate of the subsidized premiums which
would otherwise be paid or reimbursed by the Company in respect of such
benefits, minus (y) the value of any benefits provided, or to be provided, to
the Executive under subsection (A) above, and pay a lump sum cash payment equal
to the Section 409A Healthcare Coverage Payment to the Executive in lieu of such
subsidized premiums. In particular, all taxable expense reimbursement payments
and in kind benefits provided to the Executive shall be structured in compliance
with Code Section 409A and reimbursements shall be paid by the Company to the
Executive by no later than the end of the calendar year following the calendar
year in which the Executive incurs such expenses, and the Executive shall take
all actions necessary to claim all such reimbursements on a timely basis to
permit the Company to make all such reimbursement payments prior to the end of
said period.

 

(iv)          accelerate vesting on Executive’s outstanding unvested stock
options and outstanding unvested restricted stock units, which represent the
right to acquire a total of 326,042 and 36,731 additional shares of common
stock, respectively;

 

(v)           extend the exercise period of Executive’s options granted under
the 2004 Equity Incentive Plan (the “Plan”), so that all such vested options
remain exercisable until the earlier of eighteen (18) months from the Separation
Date or the date of termination of such options (e.g., 7 years from the grant
date);

 

(vi)           within ten (10) days after the date hereof (with the specific
date to be determined by the Company in its sole discretion), reimburse
Executive for outstanding unpaid business expenses incurred through the
Separation Date, subject to documentation in accordance with the Company’s
customary policy; provided, that with respect to any reimbursements or in-kind
benefits (including any continued healthcare benefits or any other fringe
benefits or reimbursements), such reimbursements or benefits shall be provided
in a manner that complies with Treasury Regulation Section 1.409A-3(i)(1)(iv),
including the following: (i) in no event shall such benefits or reimbursements
be provided later than the last day of the Executive’s taxable year following
the taxable year in which the expense was incurred or the obligation arose,
(ii) the amount of expenses eligible for reimbursement, or in-kind benefits
provided, during the Executive’s taxable year may not affect the expenses
eligible for reimbursement, or in-kind benefits provided, in any other taxable
year of the Executive, provided that any such expenses shall only be reimbursed
once, and (iii) the right to reimbursements or in-kind benefits is not subject
to liquidation or exchange for another benefit; and

 

(vii)         pay Executive within one week following the effectiveness of the
Release an amount representing an additional forty eight (48) hours of personal
time for the time period that his accrual was capped from 4/15/07 through
11/14/08 and an additional one hundred fifty eight (158.27) hours of vacation
time for the time period that the Executive’s accrual was capped from 1/31/08
through 11/14/08, which amount totals $28,261.06;

 

2

--------------------------------------------------------------------------------

 

2.             With the exception of the payment made pursuant to Section 1(ii),
which amount shall be paid without withholding and shall be reported on a
Form 1099, the Company shall undertake to make deductions, withholdings and tax
reports with respect to payments and benefits under this Release to the extent
that it reasonably and in good faith determines that it is required to make such
deductions, withholdings and tax reports. Payments under this Release shall be
in amounts net of any such deductions or withholdings. Nothing in this Release
shall be construed to require the Company to make any payments to compensate the
Executive for any adverse tax effect associated with any payments or benefits or
for any deduction or withholding from any payment or benefit.

 

3.             Executive agrees that, upon payment of the amounts set forth in
Sections 1(i), (ii) and (vii), the Company shall have paid him any and all
salary, other wages and vacation pay he is owed, if any; he acknowledges that no
such further payments or amounts are owed or will be owed with the exception of
any properly authorized business expenses incurred in reasonable amounts and
supported by documentary evidence that have not been reimbursed to Executive as
the result of any reimbursement requests submitted to the Company on or before
December 15, 2008.

 

4.             Except for the provisions of Section 1 of this Release and in
consideration for the payments and benefits described in Section 1, to which the
Executive acknowledges the Executive would not otherwise be entitled, the
Executive for himself and his heirs, agents, assigns, executors, successors and
each of them, voluntarily releases and forever discharges the Company, its
affiliated and released entities (including, without limitation, the Company’s
parent and subsidiary entities), its and their respective predecessors,
successors and assigns, its and their respective employee benefit plans and
fiduciaries of such plans, and the current and former officers, directors,
shareholders, employees, attorneys, accountants and agents of each of the
foregoing in their official and personal capacities (collectively referred to as
the “Releasees”) generally from all claims, demands, debts, damage and
liabilities of every name and nature, known or unknown (“Claims”) that, as of
the date when the Executive signs this Release, the Executive ever had, now
claims to have or ever claimed to have had against any or all of the Releasees.

 

This Release includes, without limitation, all Claims: relating to the
Executive’s employment with the Company and the termination of the Executive’s
employment; of wrongful discharge; of breach of contract; of retaliation or
discrimination under federal, state or local law, including, but not limited to,
Claims of discrimination or retaliation under Title VII of the Civil Rights Act
of 1964, Claims of disability discrimination or retaliation under the Americans
with Disabilities Act, Claims of discrimination or retaliation under the
California Fair Employment and Housing Act; Claims under the Older Worker
Benefit Protection Act; Claims under other federal or state statutes; of
defamation or other torts; of violation of public policy; for wages, bonuses,
incentive compensation, stock, stock options, vacation pay or any other
compensation or benefit; and for damages or other remedies of any sort,
including, without limitation, compensatory damages, punitive damages,
injunctive relief and attorney’s fees. Notwithstanding the foregoing, the
Executive does not release (a) any rights that cannot be waived, including,
without limitation, his right to indemnity pursuant to California Labor Code
Section 2802; (b) his right to future indemnity pursuant to the Company’s
by-laws and Delaware corporation law; and (c) his rights arising solely as a
stockholder of the Company.

 

3

--------------------------------------------------------------------------------

 

The Executive acknowledges that he is familiar with Section 1542 of the
California Civil Code, which reads as follows:

 

California Civil Code Section 1542

 

“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.”

 

The Executive agrees that he is releasing unknown claims and waiving all rights
that he may have under Section 1542 of the Civil Code of California or under any
statute or common law principle of similar effect.

 

5.             The Company voluntarily releases and discharges the Executive and
his heirs, successors, administrators, representatives and assigns from all
claims that it may have against the Executive as the result of his employment or
the discontinuance of his employment and that are based upon facts known, or
which in the exercise of reasonable diligence should have been known, to the
Company’s Board of Directors. Notwithstanding the foregoing, nothing herein
shall release or discharge any Claim by the Company against the Executive, or
the right of the Company to bring any action, legal or otherwise, against the
Executive as a result of any failure by him to perform his obligations under
this Agreement, or as a result of any acts of intentional misconduct or
recklessness.

 

The Company acknowledges that it is familiar with Section 1542 of the California
Civil Code, which reads as follows:

 

California Civil Code Section 1542

 

“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.”

 

The Company agrees that it is releasing unknown claims and waiving all rights
that it may have under Section 1542 of the Civil Code of California or under any
statute or common law principle of similar effect.

 

6.             Executive agrees that he will not make any written or oral
communications that are defamatory of the Company in any respect, including, but
not limited to, the Company’s business, technology, products, executives,
officers, directors, former executives, consultants or agents. The Company
agrees that its directors and officers will not make any written or oral
communications that could reasonably be considered to be defamatory of Executive
in any respect, including, but not limited to, the Executive’s work ethic, job
performance, and skill. The obligations of this Section 6 shall not in any way
affect Executive’s obligation or the obligations of the above-referenced persons
to testify truthfully in any legal proceeding.

 

7.             The Executive further acknowledges that during his employment, he
may have obtained confidential, proprietary and trade secret information,
including information relating to the Company’s products, plans, designs and
other valuable confidential information. The Executive

 

4

--------------------------------------------------------------------------------

 

agrees not to use or disclose any such confidential information unless required
by subpoena or court order, and further agrees to first give the Company written
notice of such subpoena or court order with reasonable advance notice to permit
the Company to oppose such subpoena or court order if it chooses to do so.

 

8.             This Release was either negotiated for Executive by a
representative of his own choosing or he, after having had a reasonable
opportunity to obtain a representative of his own choosing, elected to represent
himself in such negotiations. Both the Company and Executive are voluntarily
agreeing to this Release. It is agreed that the payments under this Release are
not an admission of any liability or obligation.

 

9.             Executive expressly states that he has read this Release and
understands all of its terms, that the preceding paragraphs recite the sole
consideration for this Release, and that this Release constitutes the entire
agreement with respect to any matters referred to in it. This Release supersedes
any and all other agreements between Executive and the Company regarding
Executive’s employment and the terms of separation. This Release may only be
amended in writing signed by Executive and an officer of the Company, and it is
executed voluntarily and with full knowledge of its significance.

 

10.           Executive has the opportunity to consider this Agreement for
twenty-one days before signing it. To accept this Agreement, Executive must
return a signed original of this Agreement so that it is received by the
undersigned at or before the expiration of this twenty-one day period. If
Executive signs this Agreement within less than twenty-one days of the date of
its delivery to Executive, Executive acknowledges by signing this Agreement that
such decision was entirely voluntary and that Executive had the opportunity to
consider this Agreement for the entire twenty-one day period.

 

For the period of seven days from the date when this Agreement becomes fully
executed, Executive has the right to revoke this Agreement by written notice to
the undersigned. For such a revocation to be effective, it must be delivered so
that it is received by the undersigned at or before the expiration of the
seven-day revocation period. This Agreement shall not become effective or
enforceable during the revocation period. This Agreement shall become effective
on the first business day following the expiration of the revocation period.

 

5

--------------------------------------------------------------------------------

 

11.           This Release will be interpreted pursuant to the laws of the State
of California, without regard to conflict of law principles.

 

 

 

Yves Audebert

 

 

 

Dated:

12/17/2008

 

/s/ Yves Audebert

 

 

 

 

 

 

 

 

 

 

Company

 

 

 

 

Dated:

12/17/2008

 

By:

/s/ JD Kerrest

 

 

 

Name: Jacques Kerrest

 

 

 

Title:   CFO/COO

 

6

--------------------------------------------------------------------------------