Exhibit 10.37

 

April 1, 2005

 

VIA HAND DELIVERY

 

Paul Rioux

[Address omitted]

 

Re: New Employment Terms

 

Dear Paul:

 

As you know, the Employment Term of your Employment Agreement with LeapFrog
Enterprises, Inc. (“Leapfrog” or the “Company”) dated April 1, 2002 expired
effective as of March 31, 2005, and that agreement is no longer in effect. This
letter agreement (the “Agreement”) sets forth the new terms of your continued
employment with LeapFrog, which are effective as of the expiration of your
previous employment agreement. These new employment terms do not affect or alter
your separate role as a member of the Company’s Board of Directors (the
“Board”).

 

No Interruption of Employment Service

 

Your employment with the Company has continued, under the terms of this
Agreement, effective as of April 1, 2005, without any interruption in your
employment service.

 

Employment Position, Duties, Work Schedule and Reporting Relationship

 

You have assumed the new position of Advisor to the Company’s Chief Executive
Officer (“CEO”). In this position, you will report directly to the CEO, who will
specify your work duties and responsibilities. You are required to make yourself
available, and to provide upon the CEO’s request, an average of eight hours of
work per week. You are not required to work in the Company’s offices, unless
specifically requested by the CEO. The Company currently anticipates that this
position, and your employment relationship, will continue until no later than
June 30, 2005, and that your employment relationship will terminate effective as
of that date.

 

Compensation and Benefits

 

Your monthly base salary will be $3,333.33, less payroll deductions and
withholdings. You will be paid semi-monthly on the Company’s normal payroll
schedule. Because your position is classified as an exempt salaried position,
you will not be eligible for additional compensation or overtime pay if you work
more than eight hours in a week. In addition, you will not be eligible for any
bonus or incentive compensation, or for any severance compensation or benefits.

 

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Paul Rioux

April 1, 2005

Page 2

 

Because of your reduced work schedule, you are no longer eligible to participate
in the Company’s group health insurance benefits under the terms of the benefit
plans. However, you will be eligible to continue your Company group health
insurance benefits pursuant to federal COBRA law at your own expense. Enclosed
with this letter is written information concerning COBRA continuation coverage.
In addition, you will accrue paid sick leave and accrual of vacation on a
pro-rated basis.

 

Compliance with Company Rules and Proprietary Information Agreement; Other
Activities

 

As a condition of your employment, you are required to abide by Company policies
and procedures, including but not limited to the Company’s Code of Business
Conduct and Ethics which you signed on June 25, 2004 (copy enclosed), and to
comply with your Proprietary Information and Inventions Agreement (“Proprietary
Information Agreement”) which you signed on June 25, 2004 (copy enclosed).

 

You may engage in outside employment or business activities during your
continued employment with the Company, so long as such other employment or
activities do not compete or conflict with the interests of Company.

 

At-Will Employment Relationship

 

Your employment relationship is at-will. This means that both you and the
Company can terminate your employment at any time, with or without cause, and
with or without advance notice. In addition, the Company retains the discretion
to change your employment terms, including but not limited to compensation,
benefits, position, work schedule, and reporting relationship.

 

This Agreement, together with its enclosures, forms the complete and exclusive
statement of your agreement with Company concerning the subject matter hereof.
It supersedes any other agreements or promises made to you by anyone, whether
oral or written. Except for those changes expressly reserved to the Company’s
discretion in this letter, this Agreement can only be modified in a written
agreement signed by you and the CEO.

 

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Paul Rioux

April 1, 2005

Page 3

 

Please sign and date this letter and return it to me to indicate your
understanding and agreement to these new terms of employment. We look forward to
continuing our productive and enjoyable work relationship.

 

Sincerely,

/s/ Laura Dillard

Laura Dillard

Vice President, Human Resources

 

Understood and Accepted:

/s/ Paul Rioux

Paul Rioux

4/1/05

Date

 

Enclosures:   

Code of Business Conduct and Ethics

Proprietary Information and Inventions Agreement