EXHIBIT 10.1

CEO

HI/FN, INC.

SEVERANCE AND CHANGE OF CONTROL AGREEMENT

        This Severance and Change of Control Agreement (the “Agreement”) is made
and entered into by and between [Executive Name] (“Executive”) and Hi/fn, Inc.,
a Delaware corporation (the “Company”), effective as of [DATE], 2005 (the
“Effective Date”).

RECITALS

    1.        It is possible that the Company could terminate Executive’s
employment with the Company. The Board of Directors of the Company (the “Board”)
recognizes that such consideration can be a distraction to Executive and can
cause Executive to consider alternative employment opportunities. The Board has
determined that it is in the best interests of the Company and its stockholders
to assure that the Company will have the continued dedication and objectivity of
Executive, notwithstanding the possibility, threat or occurrence of such a
termination.

    2.        The Board believes that it is in the best interests of the Company
and its stockholders to provide Executive with an incentive to continue his or
her employment and to motivate Executive to maximize the value of the Company
for the benefit of its stockholders.

    3.        The Board believes that it is imperative to provide Executive with
certain severance benefits upon certain terminations of Executive’s employment
with the Company. These benefits will provide Executive with enhanced financial
security and incentive and encouragement to remain with the Company.

    4.        Certain capitalized terms used in the Agreement are defined in
Section 6 below.

AGREEMENT

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

    1.        Term of Agreement. This Agreement will have an initial term of
three (3) years commencing on the Effective Date. Notwithstanding the previous
sentence, in the event of a Change of Control within three years of the
Effective Date, the term of this Agreement will extend through the one-year
anniversary of such Change of Control.

    2.        At-Will Employment. The Company and Executive acknowledge that
Executive’s employment is and will continue to be at-will, as defined under
applicable law, except as may otherwise be specifically provided under the terms
of any written formal employment agreement or offer letter between the Company
and Executive (an “Employment Agreement”). If Executive’s employment terminates
for any reason, Executive will not be entitled to any payments, benefits,
damages, awards or compensation other than as provided by this Agreement,
including any payments or benefits Executive would have otherwise been entitled
to under his or her Employment Agreement.

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    3.        Severance Benefits.

    (a)        Involuntary Termination other than for Cause, Death or Disability
Prior to a Change of Control or after Twelve Months Following a Change of
Control. If the Company (or any parent or subsidiary of the Company employing
Executive) terminates Executive’s employment with the Company (or any parent or
subsidiary of the Company) for a reason other than Cause, Executive becoming
Disabled or Executive’s death, any of which occur prior to a Change of Control
or after twelve (12) months following a Change of Control, then, subject to
Section 4, Executive will receive the following severance from the Company:

    (i)        Accrued Compensation. Executive will be entitled to receive all
accrued vacation, expense reimbursements and any other benefits due to Executive
through the date of termination of employment in accordance with the Company’s
then existing employee benefit plans, policies and arrangements.

    (ii)        Severance Payment. Executive will be paid continuing payments of
severance pay at a rate equal to Executive’s base salary rate, as then in
effect, for twelve (12) months from the date of such termination, to be paid
periodically in accordance with the Company’s normal payroll policies.

    (iii)        Continued Executive Benefits. Executive will receive
Company-paid coverage during the twelve (12) month period following such
termination for Executive and Executive’s eligible dependents under the
Company’s Benefit Plans.

    (iv)        Payments or Benefits Required by Law. Executive will receive
such other compensation or benefits from the Company as may be required by law
(for example, “COBRA” coverage under Section 4980B of the Internal Revenue Code
of 1986, as amended (the “Code”)).

    (b)        Involuntary Termination other than for Cause, Death or Disability
within Twelve Months of a Change of Control. If within twelve (12) months
following a Change of Control (A) Executive terminates his or her employment
with the Company (or any parent or subsidiary of the Company) for Good Reason or
(B) the Company (or any parent or subsidiary of the Company) terminates
Executive’s employment for other than Cause, Executive becoming Disabled or
Executive’s death, then, subject to Section 4, Executive will receive the
following severance from the Company:

    (i)        Accrued Compensation. Executive will be entitled to receive all
accrued vacation, expense reimbursements and any other benefits due to Executive
through the date of termination of employment in accordance with the Company’s
then existing employee benefit plans, policies and arrangements.

    (ii)        Severance Payment. Executive will be paid continuing payments of
severance pay at a rate equal to Executive’s base salary rate, as then in
effect, for twenty-four (24) months from the date of such termination, to be
paid periodically in accordance with the Company’s normal payroll policies.

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    (iii)        Options and Restricted Stock. 50% of the unvested shares
subject to all of Executive’s outstanding rights to purchase or receive shares
of the Company’s common stock (including, without limitation, through awards of
stock options, stock appreciation rights, restricted stock units or similar
awards) whether acquired by Executive on, before or after the date of this
Agreement and 50% any of Executive’s shares of Company common stock subject to a
Company right of repurchase or forfeiture upon Executive’s termination of
employment for any reason whether acquired by Executive on, before or after the
date of this Agreement, will immediately vest upon such termination. In all
other respects, such awards will continue to be subject to the terms and
conditions of the plans, if any, under which they were granted and any
applicable agreements between the Company and Executive.

    (iv)        Continued Executive Benefits. Executive will receive
Company-paid coverage during the twenty-four (24) month period following such
termination for Executive and Executive’s eligible dependents under the
Company’s Benefit Plans.

    (v)        Payments or Benefits Required by Law. Executive will receive such
other compensation or benefits from the Company as may be required by law (for
example, “COBRA” coverage under Section 4980B of the Code).

    (c)        Termination due to Death or Disability. If Executive’s employment
with the Company (or any parent or subsidiary of the Company) is terminated due
to Executive’s death or Executive’s becoming Disabled, then Executive or
Executive’s estate (as the case may be) will (i) receive the earned but unpaid
base salary through the date of termination of employment, (ii) receive all
accrued vacation, expense reimbursements and any other benefits due to Executive
through the date of termination of employment in accordance with
Company-provided or paid plans, policies and arrangements, and (iii) not be
entitled to any other compensation or benefits from the Company except to the
extent required by law (for example, “COBRA” coverage under Section 4980B of the
Code).

    (d)        Other Terminations. If Executive voluntarily terminates
Executive’s employment with the Company or any parent or subsidiary of the
Company (other than for Good Reason within twelve (12) months of a Change of
Control) or if the Company (or any parent or subsidiary of the Company employing
Executive) terminates Executive employment with the Company (or any parent or
subsidiary of the Company) for Cause, then Executive will (i) receive his or her
earned but unpaid base salary through the date of termination of employment,
(ii) receive all accrued vacation, expense reimbursements and any other benefits
due to Executive through the date of termination of employment in accordance
with established Company plans, policies and arrangements, and (iii) not be
entitled to any other compensation or benefits (including, without limitation,
accelerated vesting of any equity awards) from the Company except to the extent
provided under agreement(s) relating to any equity awards or as may be required
by law (for example, “COBRA” coverage under Section 4980B of the Code).

    (e)        Exclusive Remedy. In the event of a termination of Executive’s
termination of employment with the Company (or any parent or subsidiary of the
Company), the provisions of this Section 3 are intended to be and are exclusive
and in lieu of any other rights or remedies to which Executive or the Company
may otherwise be entitled (including any contrary provisions in the Employment
Agreement), whether at law, tort or contract, in equity, or under this
Agreement.

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  Executive will be entitled to no benefits, compensation or other payments or
rights upon termination of employment other than those benefits expressly set
forth in this Section 3.

    4.         Conditions to Receipt of Severance.

    (a)        Separation Agreement and Release of Claims. The receipt of any
severance pursuant to Section 3 will be subject to Executive signing and not
revoking a separation agreement and release of claims in a form reasonably
acceptable to the Company. No severance pursuant to Section 3 will be paid or
provided until the separation agreement and release agreement becomes effective.

    (b)        Nonsolicitation. The receipt of any severance benefits pursuant
to Section 3 will be subject to Executive not violating the provisions of
Section 7. In the event Executive breaches the provisions of Section 7, all
continuing payments and benefits to which Executive may otherwise be entitled
pursuant to Section 3 will immediately cease.

    (c)        Section 409A. Any cash severance to be paid pursuant to Sections
3(a)(ii) and 3(b)(ii) will not be paid during the six-month period following
Executive’s termination of employment, unless the Company reasonably determines
that paying such amounts immediately following Executive’s termination of
employment would not result the imposition of additional tax under Section 409A
of the Code (“Section 409A”), in which case such amounts shall be paid in
accordance with normal payroll practices. If no cash severance is paid to
Executive as a result of the previous sentence, on the first day following such
six-month period, the Company will pay Executive a lump-sum amount equal to the
cumulative amounts that would have otherwise been paid to Executive pursuant to
Sections 3(a)(ii) and 3(b)(ii). Thereafter, Executive will receive his cash
severance payments pursuant to Sections 3(a)(ii) and 3(b)(ii) in accordance with
the Company’s normal payroll practices.

    5.         Limitation on Payments. In the event that the severance and other
benefits provided for in this Agreement or otherwise payable to the Executive
(i) constitute “parachute payments” within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the “Code”) and (ii) but for this
Section 5, would be subject to the excise tax imposed by Section 4999 of the
Code, then the Executive’s severance benefits under Section 3 will be either:

  (a) delivered in full, or

  (b) delivered as to such lesser extent which would result in no portion of
such severance benefits being subject to excise tax under Section 4999 of the
Code,

whichever of the foregoing amounts, taking into account the applicable federal,
state and local income taxes imposed by Section 4999, results in the receipt by
Executive on an after-tax basis, of the greatest amount of severance benefits,
notwithstanding that all or some portion of such severance benefits may be
taxable under Section 4999 of the Code. Unless the Company and the Executive
otherwise agree in writing, any determination required under this Section 5
shall be made in writing by the Company’s independent public accountants (the
“Accountants”), whose determination shall be conclusive and binding upon the
Executive and the Company for all purposes. For purposes of making the
calculations required by this Section 5, the Accountants may make reasonable
assumptions and approximations concerning

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applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of Sections 280G and 4999 of the Code. The Company
and the Executive shall furnish to the Accountants such information and
documents as the Accountants may reasonably request in order to make a
determination under this Section. The Company shall bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Section 5.

    6.         Definition of Terms. The following terms referred to in this
Agreement will have the following meanings:

    (a)        Benefit Plans. “Benefit Plans” means plans, policies or
arrangements that the Company sponsors (or participates in) and that immediately
prior to Executive’s termination of employment provide Executive and/or
Executive’s eligible dependents with medical, dental, and/or vision benefits.
Benefit Plans do not include any other type of benefit (including, but not by
way of limitation, disability, life insurance or retirement benefits). A
requirement that the Company provide Executive and Executive’s eligible
dependents with coverage under the Benefit Plans will not be satisfied unless
the coverage is no less favorable than that provided to Executive and
Executive’s eligible dependents immediately prior to Executive’s termination of
employment. Notwithstanding any contrary provision of this Section 6(a), but
subject to the immediately preceding sentence, the Company may, at its option,
satisfy any requirement that the Company provide coverage under any Benefit Plan
by (i) reimbursing Executive’s premiums under COBRA after Executive has properly
elected continuation coverage under COBRA (in which case Executive will be
solely responsible for electing such coverage for Executive and Executive’s
eligible dependents), or (ii) instead providing coverage under a separate plan
or plans providing coverage that is no less favorable or by paying Executive a
lump sum payment sufficient to provide Executive and Executive’s eligible
dependents with equivalent coverage under a third party plan that is reasonably
available to Executive and Executive’s eligible dependents.

    (b)        Cause. “Cause” means (i) a failure by Executive to substantially
perform Executive’s duties as an employee, other than a failure resulting from
the Executive’s complete or partial incapacity due to physical or mental illness
or impairment, (ii) a willful act by Executive that constitutes misconduct,
(iii) circumstances where Executive intentionally or negligently imparts
material confidential information relating to the Company or its business to
competitors or to other third parties other than in the course of carrying out
Executive’s duties, (iv) a material violation by Executive of a federal or state
law or regulation applicable to the business of the Company, (v) a willful
violation of a material Company employment policy or the Company’s insider
trading policy, (vi) any act or omission by Executive constituting dishonesty
(other than a good faith expense account dispute) or fraud, with respect to the
Company or any of its affiliates, or any other misconduct which is injurious to
the financial condition of the Company or any of its affiliates or is injurious
to the business reputation of the Company or any of its affiliates, (vii)
Executive’s failure to cooperate with the Company in connection with any
actions, suits, claims, disputes or grievances against the Company or any of its
officers, directors, employees, shareholders, affiliates, divisions,
subsidiaries, predecessor and successor corporations, and assigns, whether or
not such cooperation would be adverse to Executive’s own interest, or (viii)
Executive’s conviction or plea of guilty or no contest to a felony.

    (c)        Change of Control. “Change of Control” means the occurrence of
any of the following:

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    (i)        the sale, lease, conveyance or other disposition of all or
substantially all of the Company’s assets to any “person” (as such term is used
in Section 13(d) of the Securities Exchange Act of 1934, as amended), entity or
group of persons acting in concert;

    (ii)         any person or group of persons becoming the “beneficial owner”
(as defined in Rule 13d-3 under said Act), directly or indirectly, of securities
of the Company representing 50% or more of the total voting power represented by
the Company’s then outstanding voting securities;

    (iii)        a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation that 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 or its controlling entity) at
least 50% of the total voting power represented by the voting securities of the
Company or such surviving entity (or its controlling entity) outstanding
immediately after such merger or consolidation; or

    (iv)        a contest for the election or removal of members of the Board
that results in the removal from the Board of at least 50% of the incumbent
members of the Board.

    (d)        Disability. “Disability” will mean that Executive has been unable
to perform the principal functions of Executive’s duties due to a physical or
mental impairment, but only if such inability has lasted or is reasonably
expected to last for at least six (6) months. Whether Executive has a Disability
will be determined by the Board based on evidence provided by one or more
physicians selected by the Board.

    (e)        Good Reason. “Good Reason” means (without Executive’s consent)
(i) a material reduction in Executive’s title, authority, status, or
responsibilities, unless the Executive is provided with a comparable position
(i.e. a position of equal or greater organizational level, duties, authority,
compensation and status), (ii) the reduction of Executive’s aggregate base
salary and target bonus opportunity as in effect immediately prior to such
reduction (other than a reduction applicable to executives generally), or (iii)
a relocation of Executive’s principal place of employment by more than fifty
(50) miles.

    7.        Non-Solicitation. For a period beginning on the Effective Date and
ending twelve (12) months after Executive ceases to be employed by the Company,
Executive, directly or indirectly, whether as employee, owner, sole proprietor,
partner, director, member, consultant, agent, founder, co-venturer or otherwise,
will not: (i) solicit, induce or influence any person to leave employment with
the Company; or (ii) directly or indirectly solicit business from any of the
Company’s customers and users on behalf of any business that directly competes
with the principal business of the Company.

    8.        Litigation. Executive agrees to cooperate with the Company
beginning on the Effective Date and thereafter (including following Executive’s
termination of employment for any

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reason), by making himself or herself reasonably available to testify on behalf
of the Company or any of its affiliates in any action, suit, or proceeding,
whether civil, criminal, administrative, or investigative, and to assist the
Company, or any affiliate, in any such action, suit, or proceeding, by providing
information and meeting and consulting with the Board or its representatives or
counsel, or representatives or counsel to the Company, or any affiliate as
reasonably requested. The Company agrees to reimburse Executive for all expenses
actually incurred in connection with his or her provision of testimony or
assistance.

    9.        Successors.

    (a)        The Company’s Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, merger, consolidation, liquidation
or otherwise) to all or substantially all of the Company’s business and/or
assets will assume the obligations under this Agreement and agree expressly to
perform the obligations under this Agreement in the same manner and to the same
extent as the Company would be required to perform such obligations in the
absence of a succession. For all purposes under this Agreement, the term
“Company” will include any successor to the Company’s business and/or assets
which executes and delivers the assumption agreement described in this Section
9(a) or which becomes bound by the terms of this Agreement by operation of law.

    (b)        The Executive’s Successors. The terms of this Agreement and all
rights of Executive hereunder will inure to the benefit of, and be enforceable
by, Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.

    10.         Notice.

    (a)         General. Notices and all other communications contemplated by
this Agreement will be in writing and will be deemed to have been duly given
when personally delivered or when mailed by U.S. registered or certified mail,
return receipt requested and postage prepaid. In the case of Executive, mailed
notices will be addressed to him or her at the home address which he or she most
recently communicated to the Company in writing. In the case of the Company,
mailed notices will be addressed to its corporate headquarters, and all notices
will be directed to the attention of its President.

    (b)        Notice of Termination. Any termination by the Company for Cause
or as a result of a voluntary resignation will be communicated by a notice of
termination to the other party hereto given in accordance with Section 10(a) of
this Agreement. Such notice will indicate the specific termination provision in
this Agreement relied upon, will set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination under the provision so
indicated, and will specify the termination date (which will be not more than
thirty (30) days after the giving of such notice).

    11.         Miscellaneous Provisions.

    (a)        No Duty to Mitigate. Executive will not be required to mitigate
the amount of any payment contemplated by this Agreement, nor will any such
payment be reduced by any earnings that Executive may receive from any other
source.

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    (b)        Waiver. No provision of this Agreement will be modified, waived
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by Executive and by an authorized officer of the Company
(other than Executive). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
will be considered a waiver of any other condition or provision or of the same
condition or provision at another time.

    (c)        Headings. All captions and section headings used in this
Agreement are for convenient reference only and do not form a part of this
Agreement.

    (d)        Entire Agreement. This Agreement constitutes the entire agreement
of the parties hereto and supersedes in their entirety all prior
representations, understandings, undertakings or agreements (whether oral or
written and whether expressed or implied) of the parties with respect to the
subject matter hereof, including (without limitation) the Employment Agreement).
No future agreements between the Company and Executive may supersede this
Agreement, unless they are in writing and specifically mention this Section
11(d).

    (e)        Choice of Law. The laws of the State of California (without
reference to its choice of laws provisions) will govern the validity,
interpretation, construction and performance of this Agreement.

    (f)        Severability. The invalidity or unenforceability of any provision
or provisions of this Agreement will not affect the validity or enforceability
of any other provision hereof, which will remain in full force and effect.

    (g)        Withholding. All payments made pursuant to this Agreement will be
subject to withholding of applicable income and employment taxes.

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

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        IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
set forth below.

COMPANY HI/FN, INC.   By: __________________________________   Title:
_________________________________

EMPLOYEE CHRISTOPHER G. KENBER   By: __________________________________   Title:
CHIEF EXECUTIVE OFFICER

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