EXHIBIT 10.67

 

LIBERATE

 

 

April 11, 2003

 

Philip A. Vachon

______________

______________

 

 

Dear Phil:

 

We are pleased to offer you employment as President of Liberate International. 
Your annual salary will be $250,000 (USD), less applicable withholding.  Your
bonus will be determined by the Compensation Committee of Liberate’s Board of
Directors, with timing and criteria to be mutually agreed.  Your starting date
will be April 11, 2003.

 

As an employee of Liberate Technologies, you will be eligible to participate in
a number of company-sponsored benefits, including health and medical benefits. 
Subject to the approval of Liberate’s Board of Directors or its Compensation
Committee, Liberate will grant you an option to purchase 1.7 million shares of
Liberate common stock at the fair market value per share as determined by
Liberate’s Compensation Committee.  As a condition of your receipt of the option
grant, you will confirm your investment experience, your status as an
“accredited investor”, your receipt of all information you consider necessary
and appropriate to make an investment decision, and any other representations
appropriate under the securities laws.  The option will vest monthly in equal
increments upon the completion of each of the next 48 months of service.  The
option is granted outside of Liberate’s 1999 Equity Incentive Plan (the “Plan”)
and its related agreements, but will be governed by the terms of the Plan,
except that the Board and the Compensation Committee commit not to invoke
Article 18.1(b) of the Plan, so that Article 18 will apply only if Liberate’s
independent auditors (and if they are not able to perform this evaluation,
another nationally recognized accounting firm selected by Liberate) determines
that you would receive a greater after-tax benefit if it reduced any payment or
option vesting acceleration. Liberate will file an S-8 registration statement
covering the exercise of the option as soon as reasonably practical following
its filing of its delinquent public filings.

 

The option will vest fully in the event of a Change in Control (as defined in
the Employee Retention Agreement entered into concurrently herewith between you
and Liberate) of Liberate in which the acquiring or surviving entity fails
within ten days prior to the closing thereof to make a written offer to you of
continued employment for a period of at least one year that is located within 20
miles of your present location (which, for the first year of your employment
will be deemed to be London, Ontario, and thereafter, unless changed in writing
by the mutual agreement of the parties, will be deemed to be Redmond,
Washington) and has equal or greater: (i) responsibilities, title, and reporting
relationship in the surviving entity and parent; (ii) total compensation
(including salary, bonus and equity incentives); and (iii) office and support
arrangements, and staff.  As a condition of any such accelerated vesting, you
and Liberate will sign a mutual waiver of claims (as set forth in the Employee
Retention Agreement between the parties) at the time of the acceleration.  In
addition, in the event of a Change in Control that is followed within one year
by your Actual or Constructive Termination (as defined in the Employee Retention
Agreement), Liberate will pay you an amount equal to twice the sum of your total
taxable compensation received in the prior fiscal year, with a minimum of
$500,000 (USD)  and up to a maximum of $750,000 (USD).

 

Your employment with Liberate is not for a specific term and can be terminated
by you or by Liberate at any time for any reason, with or without cause.  (We do
ask employees, to the extent possible, to give us notice if they intend to
resign.)  Additionally, Liberate may take any other employment action at any
time for any reason.  This offer is contingent upon your executing Liberate’s
Proprietary Information Agreement, and providing legally required proof of your
identity and eligibility to work in the United States.

 

We make every effort to maintain a great and rewarding work environment.  If,
however, a dispute arises, you and we agree to waive trial before a judge or
jury and to arbitrate with the JAMS arbitration service any dispute relating

 

 

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to this agreement or to your recruitment, employment, or termination, except for
claims relating to worker’s compensation benefits, unemployment insurance, or
intellectual property rights.  The arbitrator’s decision will include written
findings of fact and law and will be final and binding except to the extent that
judicial review is required by law.  The American Arbitration Association’s
National Rules for the Resolution of Employment Disputes will govern the
arbitration, except that the arbitrator will allow discovery authorized by the
California Arbitration Act and any additional discovery necessary to vindicate a
claim or defense.  The arbitrator may award any remedy that would be available
from a court of law.  You may choose to hold the arbitration either in San Mateo
County, California or the county where you worked when the arbitrable dispute
first arose.  You and we will share the arbitration costs equally (except that
we will pay the arbitrator’s fee and any other cost unique to arbitration) and
each party will pay its own attorney’s fees except as required by law.  If
either of us files any legal action or proceeding about a non-arbitrable matter,
it will be instituted in a state or federal court located in Santa Clara or San
Mateo County, California, and we and you submit to the personal jurisdiction of,
and agree that venue is proper in, these courts.

 

To confirm your acceptance of this employment agreement, please sign and date
this letter in the space provided below and return it to Temre Jenkins.  A
duplicate original is enclosed for your records.  This letter and the
Proprietary Information Agreement set forth the terms of your employment with
Liberate.  This agreement supersedes any prior representations or agreements
between us, and it may be modified only by a document signed by you and by
Liberate’s Chief Executive Officer.  This offer, if not accepted, will expire on
April 21, 2003

 

Sincerely,

 

/s/ Mitchell Kertzman

 

Liberate Technologies

By:

 

Mitchell Kertzman

 

 

Chief Executive Officer

 

I agree to and accept employment with Liberate Technologies on the terms set
forth in this agreement.

 

 

/s/ Philip A. Vachon

 

4/14/03

Philip A. Vachon

 

Date

 

 

 

2

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