Exhibit 10.1

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into effective as of
June 18, 2020 (the “Effective Date”), by and between DASAN Zhone Solutions,
Inc., a Delaware corporation (the “Company”), and Philip John Yim (“Executive”).

 

WHEREAS, the Company desires to set forth the terms on which Executive is
engaged by the Company as its Chief Operating Officer, and Executive desires to
be so engaged by the Company in such position, on the terms and conditions set
forth and described herein.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements herein contained, the parties agree as follows:

 

1. Employment.

 

(a)Position and Duties.  The Company hereby agrees to employ Executive, and
Executive hereby agrees to serve, subject to the provisions of this Agreement,
as an employee of the Company in the position of Chief Operating Officer.
Executive shall perform all services and acts necessary to fulfill the duties
and responsibilities of his position and shall render such services on the terms
set forth herein and shall report to the Company’s Chief Executive Officer (the
“Supervising Officer”).  In the event of the Supervising Officer's
unavailability or incapacity, Executive shall report to the Company's Board of
Directors (the “Board of Directors”). In addition, Executive shall have such
other executive and managerial powers and duties with respect to the Company as
may reasonably be assigned to him by the Supervising Officer, to the extent
consistent with his position and status as set forth above. Executive hereby
consents to serve as an officer of the Company or any subsidiary or affiliate
thereof without any additional salary or compensation, if so requested by the
Supervising Officer.  

 

(b)Time Commitment.  Executive agrees to devote substantially all of his
business time, attention and energies to the performance of the duties assigned
hereunder, and to perform such duties diligently, faithfully and to the best of
his abilities. Subject to the terms of Section 11 below, this shall not preclude
Executive from devoting time to personal and family investments or serving on
community and civic boards, or participating in industry associations, provided
such activities do not interfere with his duties to the Company, as determined
in good faith by the Supervising Officer or the Board of Directors.  Executive
agrees that he will not join any additional boards, other than community and
civic boards (which do not interfere with his duties to the Company), without
the prior approval of the Supervising Officer or the Board of Directors.
Executive shall be subject to and comply with the policies and procedures
generally applicable to officers of the Company to the extent the same are not
inconsistent with any term of this Agreement.

 

2. Place of Performance.  Executive shall perform his duties and conduct his
business at the principal executive offices of the Company or remotely with the
consent of the Supervising Officer, except for required travel on the Company’s
business.

 

3. Compensation.

 

(a) Salary. The Company shall pay to Executive a base salary of $300,000 per
year (the “Annual Salary”).  Executive’s Annual Salary may be reviewed on at
least an annual basis by the Board of Directors or its Compensation Committee,
and shall be payable in accordance with the Company’s regular payroll practices.

 

(b) Bonus.  In addition to Executive’s Annual Salary, Executive shall be
eligible to participate in a performance-based annual bonus program, to be
earned and paid quarterly in equal installments.  Executive’s target bonus at
full accomplishment of the Company’s goals will be $22,500 per
quarter.  Executive’s actual bonus will be based upon the overall results of the
Company compared to the quarterly performance metrics as set forth in the annual
operating plan approved by the Board of Directors for each year.  The annual
bonus plan and the final payout will be approved by the Board of Directors or
its Compensation Committee and is subject to change.  

 

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Exhibit 10.1

(c)Equity Awards.  (i)Executive has been previously granted  options to purchase
shares of the Company’s common stock (the “Option”).   The Option will continue
to vest over four-years, subject to Executive’s continued employment through
each applicable vesting date.  The Option shall be subject to the terms and
conditions of the equity plan and/or any stock option agreement pursuant to
which the Option was granted.  The Option shall continue to be granted pursuant
to the Company’s 2017 Incentive Award Plan (the “2017 Plan”).  In addition, in
the event Executive’s employment is terminated pursuant to Section 7(a)(iv) or
(v) following a “Change in Control” (as such term is defined in the 2017 Plan),
the vesting of all of Executive’s outstanding Equity Awards (as defined below)
shall fully accelerate on the date of such termination. For purposes of this
Agreement, “Equity Award” means all stock options, restricted stock and such
other awards granted to Executive pursuant to the Company’s stock option and
equity incentive award plans or agreements and any shares of stock issued upon
exercise thereof. The Executive will be provided six (6) months from the date of
such termination to exercise all vested “Equity Awards”.  After the six (6)
months period all unexercised “Equity Awards” will cancel.

 

(d)Relocation Expenses.

 

(i)In connection with the Company's planned relocation of its headquarters (the
"Headquarters Relocation"), and in furtherance of Executive’s relocation of his
principal place of residence to the location to which the Company's headquarters
is so relocated, the Company shall pay for or reimburse Executive in accordance
with the Company’s written expense reimbursement policies and procedures as then
in effect for up to a total amount to be agreed upon in writing at the time the
Headquarters Relocation has been implemented, which shall include (A) the
movement of Executive’s reasonable household goods, (B) reimbursement for round
trip tickets for house hunting trips for Executive, his spouse and/or his
dependent children, (C) reimbursement for transportation for Executive, his
spouse and his dependent children, and (D) reasonable and customary realtor
costs incurred by Executive in connection with the purchase of Executive’s
residence (collectively, the “Relocation Reimbursement”).  In addition, the
Company shall pay to Executive a tax gross-up (the “Tax Gross-Up”) for any
federal, state, local or foreign income and employment taxes Executive is
required to pay resulting from the Relocation Reimbursement and from the Tax
Gross-Up, which Tax Gross-Up shall be paid in accordance with Treasury
Regulation Section 1.409A-3(i)(1)(v).  All amounts eligible for the Relocation
Reimbursement must be incurred by and paid to Executive during the term of his
employment and within twelve (12) months following the completion of the
Headquarters Relocation.  The Relocation Reimbursement and the Tax Gross-Up
shall be paid to Executive within forty five (45) days following the Company’s
receipt of a written request for such reimbursement, but subject to receipt by
the Company of supporting receipts and/or documentation and/or receipts in form
and substance reasonably acceptable to the Company.  If Executive voluntarily
terminates his employment without Good Reason prior to the first anniversary of
the Headquarters Relocation, Executive shall repay to the Company a pro rata
portion of the Relocation Reimbursement and any Tax Gross-Up based on the number
of days elapsed in the one-year period ending on the first anniversary of the
Effective Date.  The Company will have the right to offset such amounts against
any compensation otherwise payable to Executive on the date of Executive’s
termination of employment.

(ii) Housing and Automobile Allowance.  During the term of Executive's
employment and in coordination of the Headquarters Relocation the Company will
provide a maximum of six (6) months temporary housing and automobile allowance
from the commencement of Executive’s relocation.  The Company shall pay for or
reimburse Executive on a monthly basis in accordance with the Company’s written
expense reimbursement policies and procedures for reasonable housing and
automobile expenses in the Plano, Texas area.

 

4. Business Expenses. During the term of Executive's employment, the Company
will reimburse Executive for all ordinary and necessary business expenses
incurred by him in connection with his employment upon timely submission by the
Executive of receipts and other documentation in conformance with the Company’s
written expense reimbursement policies and procedures as then in effect. This
includes monthly cell phone expenses.

 

5. Vacation, Holidays and Sick Leave. During the term of Executive's employment,
Executive shall be entitled to paid vacation, paid holidays and sick leave in
accordance with the Company’s standard policies for its officers.

 

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Exhibit 10.1

6. Benefits. During the term of Executive's employment, Executive shall be
eligible to participate fully in all health benefits, insurance programs,
pension and retirement plans and other employee benefit and compensation
arrangements (collectively, the “Employee Benefits”) available to officers of
the Company generally.

 

7. Termination of Employment.

 

(a) Notwithstanding any provision of this Agreement to the contrary, the
employment of Executive hereunder shall terminate on the first to occur of the
following dates:

 

(i) the date of Executive’s death or adjudicated incompetency;

 

(ii) the date on which Executive shall have experienced a Disability (as defined
below), and the Company terminates Executive’s employment on account of
Disability;

 

(iii) the date on which Executive’s employment is terminated by the Company for
Cause (as defined below);

 

(iv) the date on which Executive’s employment is terminated by the Company for
any reason other than the reasons set forth in (i) through (iii) above;

 

(v) the date on which Executive resigns his employment for Good Reason (as
defined below); or

 

(vi) the date on which Executive resigns his employment for a reason other than
Good Reason.

 

(b) For purposes of this Agreement, “Disability” shall mean an illness, injury
or other incapacitating condition as a result of which Executive is
substantially unable to perform the services required to be performed under this
Agreement for (i) one hundred eighty (180) consecutive days; or (ii) a period or
periods aggregating more than two hundred forty (240) days in any period of
twelve (12) consecutive months. In the event the Company seeks to terminate
Executive’s employment due to Disability, the Company shall give notice to
Executive of the termination of Executive’s employment for Disability. Executive
agrees to submit to such medical examinations as may be necessary to determine
whether a Disability exists, pursuant to such reasonable requests made by the
Company from time to time. Any determination as to the existence of a Disability
shall be made by a physician approved by the Board of Directors and by Executive
(or, if Executive is unable to give such approval, by Executive’s
representative), which approval shall not be unreasonably withheld by the Board
of Directors or Executive.

 

(c) For purposes of this Agreement, “Cause” shall mean the occurrence of any of
the following events:

 

(i) Executive’s willful or continual failure to substantially perform his duties
with the Company or any subsidiary or affiliate, or any failure to carry out, or
comply with, in any material respect any lawful and reasonable directive of the
Supervising Officer or the Board of Directors consistent with the terms of this
Agreement, which failure continues for fifteen (15) days following Executive’s
receipt of written notice from the Supervising Officer or the Board of Directors
stating with specificity the duties the Supervising Officer or the Board of
Directors has reasonably determined Executive to have willfully or continually
failed to substantially perform or such failure;

 

(ii) Executive’s conviction of, guilty plea to, or entry of a nolo contendere
plea to a felony or a crime of moral turpitude or commission of an act of fraud,
embezzlement or misappropriation against the Company or any subsidiary or
affiliate;

 

(iii) Executive’s engagement in willful or reckless misconduct that has caused
or is reasonably likely to cause demonstrable and material financial injury to
the Company or any subsidiary or affiliate; or

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Exhibit 10.1

 

(iv) Executive’s willful and material breach of this Agreement, which breach
remains uncured (if capable of being cured) for fifteen (15) days following
Executive’s receipt of written notice from the Supervising Officer or the Board
of Directors stating with specificity those provisions of this Agreement which
Executive has breached.

 

For purposes of Sections 7(c)(i), (iii) and (iv), an act on Executive’s part
shall not be deemed “willful,” “reckless,” or “continual” if done by Executive
in good faith and with reasonable belief that the act was in the best interest
of the Company.

 

(d) For purposes of this Agreement, “Good Reason” shall mean the occurrence of
any of the following events without the Executive’s consent:

 

(i) a material diminution in Executive’s base compensation;

 

(ii) a material diminution in Executive’s authority, duties or responsibilities;

(iii) a material change in the geographic location at which Executive must
perform his duties; provided that the requirement that Executive relocate to the
San Francisco Bay Area in connection with his commencement of employment or to
another location within the United States in connection with the Headquarters
Relocation shall not constitute “Good Reason” for purposes of this Agreement; or

(iv) any other action or inaction that constitutes a material breach by the
Company of its obligations to Executive under this Agreement.

Notwithstanding the foregoing, Good Reason shall only exist if Executive shall
have provided the Company with ninety (90) days written notice of the initial
occurrence of any of the foregoing events or conditions, and the Company fails
to eliminate the conditions constituting Good Reason within thirty (30) days
after receipt of written notice of such event or condition from Executive.
Executive’s termination by reason of resignation from employment with the
Company for Good Reason shall be treated as involuntary.  Executive’s
resignation from employment with the Company for Good Reason must occur within
six (6) months following the initial existence of the act or failure to act
constituting Good Reason.  

 

8. Compensation in Event of Termination.  The Company and Executive acknowledge
that Executive’s employment is and shall continue to be at-will, as defined
under applicable law, and that Executive’s employment with the Company may be
terminated by either party at any time for any or no reason, with or without
notice.  If Executive’s employment terminates for any reason, Executive shall
not be entitled to any payments, benefits, damages, awards or compensation other
than as provided in this Agreement.  Executive’s employment under this Agreement
shall be terminated immediately on the death of Executive.  Upon termination of
Executive's employment for any reason, the Company shall have no further
obligation to Executive except to pay the amounts set forth in this Section 8.

 

(a) In the event Executive’s employment is terminated pursuant to Sections
7(a)(i), (ii), (iii) or (vi), Executive or his estate, conservator or designated
beneficiary, as the case may be, shall be entitled to payment of any earned but
unpaid Annual Salary through the date of termination, as well as any accrued
vested benefits and unreimbursed business expenses to which Executive is
entitled. Following any such termination, neither Executive nor his estate,
conservator or designated beneficiary shall be entitled to receive any other
payment provided for hereunder with respect to any period after such
termination, except as Executive may otherwise be entitled pursuant to any
employee benefit plan.

 

(b) In the event Executive’s employment is terminated pursuant to Section
7(a)(iv) or (v), Executive shall be entitled to receive, as his sole and
exclusive remedy, (i) payment of any earned but unpaid Annual Salary through the
date of termination, as well as any accrued vested benefits and unreimbursed
business expenses to which Executive is entitled, (ii) a lump sum payment equal
to the sum of (x) the greater of (A) six (6) months of Executive’s Annual Salary
as in effect immediately prior to the date of termination, or (B) $150,000, plus
(y) an amount equal to the bonus earned by Executive pursuant to Section 4(b)
for the calendar quarter in which the

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Exhibit 10.1

date of termination occurs to be determined based on actual performance for such
quarter, which amount shall be paid in exchange for a standard release of
claims, and (iii) if the Executive elects COBRA continuation coverage of medical
and/or dental benefits and payments for the six (6) months following the date of
termination, Company will pay such COBRA employee premiums only after the
Executive has signed and returned all required COBRA Election forms within the
time frame outlined in the applicable COBRA packet.  The Executive’s COBRA
packet will be mailed to his home address upon termination.  For continuation
coverage of benefits other than medical or dental (e.g. vision or EAP) or for
continuation of medical or dental coverage beyond such six (6) month period, the
Executive must submit premium payments, at his own expense, per the COBRA
provisions outlined in the applicable COBRA packet.

 

Executive will not receive the severance in this Section 8(b) if he does not
sign the release of claims within fifty (50) days following his date of
termination, or he revokes the release.  The severance will be paid on the
eighth (8th) day following the effective date of the release; provided that,
subject to Section 8(d), in no event will the severance be paid beyond the date
specified in the first section of Section 8(c) below.

 

(c)This Agreement is not intended to provide for any deferral of compensation
subject to Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), and, accordingly, the severance payments payable under Section 8(b)(ii)
shall be paid no later than the later of:  (i) the fifteenth (15th) day of the
third month following Executive’s first taxable year in which such severance
benefit is no longer subject to a substantial risk of forfeiture, and (ii) the
fifteenth (15th) day of the third month following the first taxable year of the
Company in which such severance benefit is no longer subject to a substantial
risk of forfeiture, as determined in accordance with Code Section 409A and any
Treasury Regulations and other guidance issued thereunder. To the extent
applicable, this Agreement shall be interpreted in accordance with Code Section
409A and Department of Treasury regulations and other interpretive guidance
issued thereunder.  To the extent that any provision in this Agreement is
ambiguous as to its compliance with Section 409A of the Code, the provision
shall be read in such a manner that no payments payable under this Agreement
shall be subject to an “additional tax” as defined in Section 409A(a)(1)(B) of
the Code.  Each series of installment payments made under this Agreement is
hereby designated as a series of “separate payments” within the meaning of
Section 409A of the Code.  For purposes of this Agreement, all references to
Executive’s “termination of employment” shall mean Executive’s “separation from
service” (as defined in Treasury Regulation Section 1.409A-1(h)).

(d)Notwithstanding anything to the contrary in this Agreement, if at the time of
Executive’s termination of employment with the Company Executive is a “specified
employee” as defined in Code Section 409A, as determined by the Company in
accordance with Code Section 409A, to the extent that the payments or benefits
under this Agreement are subject to Code Section 409A and the delayed payment or
distribution of all or any portion of such amounts to which Executive is
entitled under this Agreement is required in order to avoid a prohibited
distribution under Code Section 409A(a)(2)(B)(i), then such portion shall be
paid or distributed to Executive during the thirty (30) day period commencing on
the earlier of (i) the date that is six (6) months following Executive’s
termination of employment with the Company, (ii) the date of Executive’s death,
or (iii) the earliest date as is permitted under Code Section 409A.

9. Representations.

 

(a) The Company represents and warrants that this Agreement has been authorized
by all necessary corporate action of the Company and is a valid and binding
agreement of the Company enforceable against the Company in accordance with its
terms.  

 

(b) The Executive represents and warrants that he is not a party to any
agreement or instrument which would prevent him from entering into or performing
his duties in any way under this Agreement.

 

10. Confidentiality; Assignment of Inventions.  Executive has entered into the
Company’s standard Employee Innovations and Proprietary Rights Assignment
Agreement, a copy of which is attached hereto as Exhibit A (the “Proprietary
Rights Agreement”), which Proprietary Rights Agreement is incorporated herein by
reference, and hereby agrees to comply with the terms and conditions thereof
during the term of Executive's employment and thereafter in accordance with its
terms.

 

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Exhibit 10.1

11. Noncompetition; Nonsolicitation.

 

(a)Noncompetition.  Except as may otherwise be approved by the Supervising
Officer or the Board of Directors, during the term of Executive's employment,
Executive shall not have any ownership interest (of record or beneficial) in, or
have any interest as an employee, salesman, consultant, officer or director in,
or otherwise aid or assist in any manner, any firm, corporation, partnership,
proprietorship or other business that engages in any county, city or part
thereof in the United States and/or any foreign country in a business which
competes directly or indirectly (as determined by the Supervising Officer or the
Board of Directors) with the Company’s business or the business of its
subsidiaries and affiliates in such county, city or part thereof, so long as the
Company, its subsidiaries or affiliates, or any successor in interest of the
Company to the business and goodwill of the Company or its subsidiaries or
affiliates, remains engaged in such business in such county, city or part
thereof or continues to solicit customers or potential customers therein;
provided, however, that Executive may own, directly or indirectly, solely as an
investment, securities of any entity which are traded on any national securities
exchange if Executive (i) is not a controlling person of, or a member of a group
which controls, such entity; or (ii) does not, directly or indirectly, own one
percent (1%) or more of any class of securities of any such entity.

(b)Customers and Suppliers.  Executive recognizes that he will possess
Proprietary Information (as such term is defined in the Proprietary Rights
Agreement) about the customers or suppliers of the Company and its subsidiaries
and affiliates.  Executive recognizes that the Proprietary Information he will
possess about these customers or suppliers may not be generally known, is of
substantial value to the Company and its subsidiaries in developing its business
and in securing and retaining customers, and will be acquired by him because of
his business position with the Company and its subsidiaries and
affiliates.  Executive agrees that, during the term of Executive's employment
and for a period of nine (9) months beyond the termination of Executive's
employment, he will not, directly or indirectly, influence or attempt to
influence customers or suppliers of the Company or any of its subsidiaries or
affiliates to divert their business to any competitor of the Company, and that
he will not convey any such Proprietary Information or trade secrets about the
customers or suppliers of the Company and its subsidiaries or affiliates to any
other person.

 

(c) Employees.  Executive recognizes that he will possess Proprietary
Information about other employees of the Company and its subsidiaries and
affiliates relating to their education, experience, skills, abilities,
compensation and benefits, and inter-personal relationships with customers of
the Company and its subsidiaries and affiliates.  Executive recognizes that the
Proprietary Information he will possess about these other employees is not
generally known, is of substantial value to the Company and its subsidiaries in
developing its business and in securing and retaining customers, and will be
acquired by him because of his business position with the Company and its
subsidiaries and affiliates.  Executive agrees that, during the term of
Executive's employment and for a period of nine (9) months beyond termination of
Executive's employment, he will not, directly or indirectly, induce, solicit or
recruit any employee of the Company or its subsidiaries or affiliates for the
purpose of being employed by him or by any competitor of the Company on whose
behalf he is acting as an agent, representative or employee, and that he will
not convey any such Proprietary Information or trade secrets about other
employees of the Company and its subsidiaries or affiliates to any other person.

 

(d) Reasonableness of Relief; Blue Penciling. Executive acknowledges and agrees
that the covenants and agreements contained herein are reasonable and valid in
geographic and temporal scope and in all other respects and are reasonably
necessary to protect the Company.  If any court determines that any of the
covenants and agreements contained herein, or any part thereof, is unenforceable
because of the duration or geographic scope of such provision, such court shall
have the power to reduce the duration or scope of such provision, as the case
may be, and, in its reduced form, such provision shall then be enforceable to
the maximum extent permitted by applicable law.

 

12. Rights and Remedies upon Breach. In the event Executive breaches, or
threatens to commit a breach of, any of the provisions of this Agreement, the
Company and its subsidiaries, affiliates, successors or assigns shall have the
following rights and remedies, each of which shall be independent of the others
and severally enforceable, and each of which shall be in addition to, and not in
lieu of, any other rights or remedies available to the Company or its
subsidiaries, affiliates, successors or assigns at law or in equity under this
Agreement or otherwise:

 

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Exhibit 10.1

(a) Specific Performance. The right and remedy to have each and every one of the
covenants in this Agreement specifically enforced and the right and remedy to
obtain injunctive relief, it being agreed that any breach or threatened breach
of any of the nonsolicitation or other restrictive covenants and agreements
contained herein would cause irreparable injury to the Company and its
subsidiaries, affiliates, successors or assigns and that money damages would not
provide an adequate remedy at law to the Company and its subsidiaries,
affiliates, successors or assigns.

 

(b) Accounting. The right and remedy to require Executive to account for and pay
over to the Company and its subsidiaries, affiliates, successors or assigns, as
the case may be, all compensation, profits, monies, accruals, increments or
other benefits derived or received by Executive that result from any transaction
or activity constituting a material breach of this Agreement, except that
Executive shall be required to account for and pay over the aforementioned
compensation, profits, monies, accruals, increments or other benefits only
pursuant to an award rendered by an arbitrator and entered in a court of
competent jurisdiction, as set forth in Paragraph 22 herein, which finds that
Executive materially breached this Agreement and owes the Company such amounts
as a result of the material breach.

(c) Cessation of Payments.  The right to cease all severance payments to
Executive hereunder.

 

(d)Enforceability in all Jurisdictions.  Executive intends to and hereby confers
jurisdiction to enforce each and every one of the covenants and agreements
contained herein upon the courts of any jurisdiction within the geographic scope
of such covenants and agreements. If the courts of any one or more of such
jurisdictions hold any such covenant or agreement unenforceable by reason of the
breadth or such scope or otherwise, it is the intention of Executive and the
Company that such determination shall not bar or in any way affect the Company’s
or any of its subsidiaries’, affiliates’, successors’ or assigns’ right to the
relief provided above in the courts of any other jurisdiction within the
geographic scope of such covenants and agreements, as to breaches of such
covenants and agreements in such other respective jurisdictions, such covenants
and agreements as they relate to each jurisdiction being, for this purpose,
severable into diverse and independent covenants and agreements.

(e)Whistleblower Provision. Nothing herein is intended to or shall prevent
Executive from communicating directly with, cooperating with, or providing
information to, any federal, state or local government regulator, including, but
not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity
Futures Trading Commission, or the U.S. Department of Justice. Executive
acknowledges that the Company has provided Employee with the following notice of
immunity rights in compliance with the requirements of the Defend Trade Secrets
Act: (i) Executive shall not be held criminally or civilly liable under any
Federal or State trade secret law for the disclosure of proprietary information
of the Company that is made in confidence to a Federal, State, or local
government official or to an attorney solely for the purpose of reporting or
investigating a suspected violation of law, (ii) Executive shall not be held
criminally or civilly liable under any Federal or State trade secret law for the
disclosure of proprietary information of the Company that is made in a complaint
or other document filed in a lawsuit or other proceeding, if such filing is made
under seal and (iii) if Executive files a lawsuit for retaliation by the Company
for reporting a suspected violation of law, Executive may disclose the
proprietary information to my attorney and use the proprietary information in
the court proceeding, if Executive files any document containing the proprietary
information under seal, and does not disclose the proprietary information,
except pursuant to court order.

 

13. Binding Agreement. This Agreement is a personal contract and the rights and
interests of the Executive hereunder may not be sold, transferred, assigned,
pledged, encumbered, or hypothecated by him. This Agreement shall inure to the
benefit of and be enforceable by the Executive and his personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die while any amount would still
be payable to him hereunder had the Executive continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to his devisee, legatee or other designee or, if there
is no such designee, to his estate. This Agreement shall be binding upon and
shall by its terms automatically be assigned to any successor in interest to the
Company in a change in control, including but not limited to any entity that
acquires substantially all of the assets, capital stock or operations of the
Company.

 

14. Return of Company Property. Executive agrees that following the termination
of his employment for any reason, he shall return all property of the Company,
its subsidiaries, affiliates and any divisions thereof he

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Exhibit 10.1

may have managed which is then in or thereafter comes into his possession,
including, but not limited to, documents, contracts, agreements, plans,
photographs, books, notes, electronically stored data and all copies of the
foregoing as well as any materials or equipment supplied by the Company to
Executive.

 

15. Entire Agreement. This Agreement, together with the Proprietary Rights
Agreement, contains all the understandings between the parties hereto pertaining
to the matters referred to herein, and supersedes all undertakings and
agreements, whether oral or in writing, previously entered into by them with
respect thereto. Executive represents that, in executing this Agreement, he does
not rely and has not relied upon any representation or statement not set forth
herein made by the Company with regard to the subject matter, bases or effect of
this Agreement or otherwise.

 

16. Amendment or Modification, Waiver. No provision of this Agreement may be
amended or waived unless such amendment or waiver is agreed to in writing,
signed by Executive and by a duly authorized officer of the Company. The failure
of either party to this Agreement to enforce any of its terms, provisions or
covenants shall not be construed as a waiver of the same or of the right of such
party to enforce the same. Waiver by either party hereto of any breach or
default by the other party of any term or provision of this Agreement shall not
operate as a waiver of any other breach or default.

 

17. Notices. Any notice to be given hereunder shall be in writing and shall be
deemed given when delivered personally, sent by courier or fax or registered or
certified mail, postage prepaid, return receipt requested, addressed to
Executive at the most recent address on the Company’s payroll records and to the
Company at the address indicated below or to such other address as either party
may subsequently give notice of hereunder in writing:

 

To the Company at:

 

DASAN Zhone Solutions, Inc.

1350 South Loop Rd., Suite 130

Alameda, CA 94502

Attention:  Chief Executive Officer

 

Any notice delivered personally or by courier under this Section 17 shall be
deemed given on the date delivered and any notice sent by telecopy or registered
or certified mail, postage prepaid, return receipt requested, shall be deemed
given on the date telecopied or mailed.

 

18. Severability. In the event that any one or more of the provisions of this
Agreement shall be held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remainder of the Agreement shall not in any
way be affected or impaired thereby. Moreover, if any one or more of the
provisions contained in this Agreement shall be held to be excessively broad as
to duration, activity or subject, such provisions shall be construed by limiting
and reducing them so as to be enforceable to the maximum extent allowed by
applicable law.

 

19. Survivorship. The respective rights and obligations of the parties
hereunder, including but not limited to Executive’s obligations under Sections
10, 11 and 12, shall survive any termination of this Agreement to the extent
necessary to the intended preservation of such rights and obligations.

 

20. Each Party the Drafter. This Agreement and the provisions contained in it
shall not be construed or interpreted for or against any party to this Agreement
because that party drafted or caused that party’s legal representative to draft
any of its provisions.

 

21. Governing Law; Venue. This contract shall be governed by the laws of the
State of California as they are applied to contracts between California
residents to be performed completely within California.  The parties irrevocably
submit to the non-exclusive jurisdiction of the Superior Court of the State of
California, Santa Clara County, and the United States District Court for the
Northern District of California, Branch nearest to Palo Alto, California, in any
action to enforce an arbitration award or any other suit brought
hereunder.  Each party hereby agrees that any such court shall have in personam
jurisdiction over it and consents to service of process in any manner authorized
by California law.

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Exhibit 10.1

 

22. Binding Arbitration.  Except as provided in Section 12(a) of this Agreement,
any dispute, claim or controversy based on, arising out of or relating to
Executive’s employment or this Agreement shall be settled by final and binding
arbitration in Palo Alto, California, before a single neutral arbitrator in
accordance with the employment arbitration rules (the “Rules”) of the Judicial
Arbitration and Mediation Services/Endispute (“JAMS”), and judgment on the award
rendered by the arbitrator may be entered in any court having jurisdiction.
Arbitration may be compelled pursuant to the California Arbitration Act (Code of
Civil Procedure §§ 1280 et seq.).  If the parties are unable to agree upon an
arbitrator, one shall be appointed by the AAA in accordance with its
Rules.  Subject to Section 23 below, each party shall pay the fees of its own
attorneys, the expenses of its witnesses and all other expenses connected with
presenting its case.  Other costs of the arbitration, including the cost of any
record or transcripts of the arbitration, JAMS’s administrative fees, the fee of
the arbitrator, and all other fees and costs, shall be borne by the
Company.  This Section 22 is intended to be the exclusive method for resolving
any and all claims by the parties against each other for payment of damages
under this Agreement or relating to Executive’s employment; provided, however,
that Executive shall retain the right to file administrative charges with or
seek relief through any government agency of competent jurisdiction, and to
participate in any government investigation, including but not limited to (a)
claims for workers’ compensation, state disability insurance or unemployment
insurance; (b) claims for unpaid wages or waiting time penalties brought before
the California Division of Labor Standards Enforcement; provided, however, that
any appeal from an award or from denial of an award of wages and/or waiting time
penalties shall be arbitrated pursuant to the terms of this Agreement; and (c)
claims for administrative relief from the United States Equal Employment
Opportunity Commission and/or the California Department of Fair Employment and
Housing (or any similar agency in any applicable jurisdiction other than
California); provided, further, that Executive shall not be entitled to obtain
any monetary relief through such agencies other than workers’ compensation
benefits or unemployment insurance benefits.  This Agreement shall not limit
either party’s right to obtain any provisional remedy, including, without
limitation, injunctive or similar relief, from any court of competent
jurisdiction as may be necessary to protect their rights and interests pending
the outcome of arbitration, in any court of competent jurisdiction pursuant to
California Code of Civil Procedure § 1281.8 or any similar statute of an
applicable jurisdiction.  Seeking any such relief shall not be deemed to be a
waiver of such party’s right to compel arbitration.  Both Executive and the
Company expressly waive their right to a jury trial.

 

23. Attorney Fees. In the event that any dispute between the Company and
Executive should result in arbitration, the arbitrator may award to one or more
of the Prevailing Persons (as defined below) such reasonable attorney fees,
costs and expenses, as determined by the arbitrator. Any judgment or order
enforcing such arbitration may, in the discretion of the court entering such
judgment or order contain, a specific provision providing for the recovery of
attorney fees and costs incurred in enforcing such judgment or order and an
award of prejudgment interest from the date of the breach at the maximum rate of
interest allowed by law. For the purposes of this Section 23:

 

(a) “attorney fees” shall include, without limitation, attorney fees incurred in
the following:

 

(i) arbitration;

 

(ii) post-arbitration order or judgment motions;

 

(iii) contempt proceedings;

 

(iv) garnishment, levy, and debtor and third party examinations;

 

(v) discovery; and

 

(vi) bankruptcy litigation;

 

(b) “Prevailing Person” shall mean any person who is determined by the
arbitrator in the proceeding to have prevailed or who prevails by dismissal,
default or otherwise.

 

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Exhibit 10.1

24. Headings. All descriptive headings of sections and paragraphs in this
Agreement are intended solely for convenience, and no provision of this
Agreement is to be construed by reference to the heading of any section or
paragraph.

 

25. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

 

26.Code Section 409A.  

(a)Any reimbursement of expenses or in-kind benefits payable under this
Agreement shall be made in accordance with Treasury Regulation Section
1.409A-3(i)(1)(iv) and shall be paid on or before the last day of Executive’s
taxable year following the taxable year in which Executive incurred the
expenses.  The amount of expenses reimbursed or in-kind benefits payable in one
year shall not affect the amount eligible for reimbursement or in-kind benefits
payable in any other taxable year of Executive’s, and Executive’s right to
reimbursement for such amounts shall not be subject to liquidation or exchange
for any other benefit.

(b)In the event that the amounts payable under Section 8(b)(ii) are subject to
Section 409A of the Code and the timing of the delivery of Executive’s release
could cause such amounts to be paid in one or another taxable year, then
notwithstanding the payment timing set forth in such Section, such amounts shall
not be payable until the later of (i) the payment date specified in such section
or (ii) the first business day of the taxable year following the Executive’s
“separation from service.”

27.Withholding.  All applicable withholding taxes shall be deducted from any
payments to Executive hereunder.  

(Signature Page Follows)

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Exhibit 10.1

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

 

 

DASAN Zhone Solutions, Inc

 

EXECUTIVE

 

 

 

By: /s/ Il Yung Kim

 

By: /s/ Philip John Yim

Name: Il Yung Kim

 

Name: Philip John Yim

Title:   Chief Executive Officer

 

Title:  Chief Operating Officer

 

 

 

11