Exhibit 10.32


 


AMENDED AND RESTATED


EMPLOYMENT AND
NONCOMPETITION AGREEMENT


 


THIS
AMENDED AND RESTATED EMPLOYMENT AND NONCOMPETITION AGREEMENT (the “Agreement”)
is made and entered into as of February 8, 2005, by and among Avocent
Huntsville Corp., an Alabama corporation (“AHC” or “Employer”), Avocent
Corporation, a Delaware corporation, and Stephen M. Daly (the
“Employee”).


 


RECITALS


 


WHEREAS, Employee, AHC, and Avocent Utah Corp. (formerly known as
Soronti, Inc.) entered into that certain Employment and Noncompetition
Agreement dated November 4, 2003 (the “Original Employment Agreement”) in
connection with the acquisition by AHC of Soronti, Inc. (now known as
Avocent Utah Corp.) on November 4, 2003 (the “Soronti Acquisition Date”);
and


 


WHEREAS,
Avocent Corporation and its affiliates including Avocent International Ltd.,
Avocent Huntsville Corp., Avocent Redmond Corp., Avocent Utah Corp., and OSA
Technologies, Inc. (Avocent Corporation and its affiliates are
collectively referred to in this Agreement as “Avocent”) are engaged in the
business of designing, manufacturing, and selling connectivity solutions for
enterprise data centers, service providers, and financial institutions; and


 


WHEREAS,
Employee, Employer, and Avocent Corporation now wish to amend and restate the
Original Employment Agreement with this Amended and Restated Employment and
Noncompetition Agreement.


 


AGREEMENT


 


THE
PARTIES HERETO AGREE AS FOLLOWS:


 


1.                                       DUTIES. 
During the term of this Agreement, the Employee agrees to be employed by
Employer and to serve Avocent as its Senior Vice President of Corporate
Strategy.  The Employee shall devote such
of his business time, energy, and skill to the affairs of Avocent and Employer
as shall be necessary to perform the duties of Senior Vice President of
Corporate Strategy.  The Employee shall
report to the Chief Executive Officer of the Employer and Avocent Corporation
and to the Boards of Directors of the Employer and Avocent Corporation, and at
all times during the term of this Agreement, the Employee shall have powers and
duties at least commensurate with his position as Senior Vice President of
Corporate Strategy of Avocent Corporation.


 


2.                                       TERM OF EMPLOYMENT.


 


2.1                                 DEFINITIONS.  For purposes of this Agreement the following
terms shall have the following meanings:


 


(a)                                  “TERMINATION
FOR CAUSE” shall mean termination by the Employer or Avocent Corporation of the
Employee’s employment with the Employer or Avocent by reason of the Employee’s
willful dishonesty towards, fraud upon, or deliberate injury or attempted


 


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injury to, the
Employer or Avocent or by reason of the Employee’s willful material breach of
this Agreement which has resulted in material injury to the Employer or
Avocent.


 


(b)                                 “TERMINATIONS
OTHER THAN FOR CAUSE” shall mean termination by the Employer or Avocent
Corporation of the Employee’s employment with the Employer or Avocent (other
than in a Termination for Cause) and shall include any constructive termination
of the Employee’s employment by reason of material breach of this Agreement by
the Employer or Avocent, such constructive termination to be effective upon
thirty (30) days written notice from the Employee to the Employer of such
constructive termination.


 


(c)                                  “VOLUNTARY
TERMINATION” shall mean termination by the Employee of the Employee’s
employment with the Employer or Avocent other than (i) constructive
termination as described in subsection 2.1(b), (ii) “Termination Upon a Change in Control” as described in Section 2.1(e),
and (iii) termination by reason of the Employee’s disability or death as
described in Sections 2.5 and 2.6.


 


(d)                                 “TERMINATION
UPON A CHANGE IN CONTROL” shall mean (i) a termination by the Employee of
the Employee’s employment with the Employer or Avocent within six (6) months
following any “Change in Control” or (ii) any termination by the Employer
or Avocent Corporation of the Employee’s employment with the Employer or
Avocent (other than a Termination for Cause) within eighteen (18) months
following any “Change in Control.”


 


(e)                                  “CHANGE IN
CONTROL” shall mean, after the date of this Agreement, any one of the following
events:


 


(i)                                     Any person
(other than Avocent Corporation) acquires beneficial ownership of Employer’s or
Avocent Corporation’s securities and is or thereby becomes a beneficial owner
of securities entitling such person to exercise twenty-five percent (25%) or
more of the combined voting power of Employer’s or Avocent Corporation’s then
outstanding stock.  For purposes of this
Agreement, “beneficial ownership” shall be determined in accordance with
Regulation 13D under the Securities Exchange Act of 1934, or any similar
successor regulation or rule; and the term “person” shall include any natural
person, corporation, partnership, trust or association, or any group or
combination thereof, whose ownership of Employer’s or Avocent Corporation’s
securities would be required to be reported under such Regulation 13D, or
any similar successor regulation or rule.


 


(ii)                                  Within any
twenty-four (24) month period, the individuals who were Directors of Avocent
Corporation at the beginning of any such period, together with any other
Directors first elected as directors of Avocent Corporation pursuant to
nominations approved or ratified by at least two-thirds (2/3) of the Directors
in office immediately prior to any such election, cease to constitute a
majority of the Board of Directors of Avocent Corporation.


 


(iii)                               Avocent
Corporation’s stockholders approve:


 


(1)                                  any
consolidation or merger of Avocent Corporation in which Avocent Corporation is
not the continuing or surviving corporation or pursuant to which shares of
Avocent Corporation common stock would be converted into cash, securities or
other property, other than a merger or consolidation of Avocent Corporation in
which the holders of Avocent Corporation’s common stock immediately prior to the
merger or consolidation have


 


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substantially the same
proportionate ownership and voting control of the surviving corporation
immediately after the merger or consolidation; or


 


(2)                                  any sale, lease,
exchange, liquidation or other transfer (in one transaction or a series of
transactions) of all or substantially all of the assets of Avocent Corporation.


 


Notwithstanding
subparagraphs (e)(iii)(1) and (e)(iii)(2) above, the term “Change
in Control” shall not include a consolidation, merger, or other reorganization
if upon consummation of such transaction all of the outstanding voting stock of
Avocent Corporation is owned, directly or indirectly, by a holding company, and
the holders of Avocent Corporation’s common stock immediately prior to the
transaction have substantially the same proportionate ownership and voting
control of such holding company after such transaction.


 


2.2                                 BASIC
TERM.  The term of employment of the
Employee by the Employer shall be for the period beginning on the date of this
Agreement, and ending on December 31, 2007, unless terminated earlier
pursuant to this Section 2.  At any
time before December 31, 2007, the Employer and the Employee may by mutual
written agreement extend the Employee’s employment under the terms of this
Agreement for such additional periods as they may agree.


 


2.3                                 TERMINATION FOR
CAUSE.  Termination For
Cause may be effected by the Employer at any time during the term of this
Agreement and shall be effected by thirty (30) days written notification to the
Employee from the Boards of Directors of Employer and Avocent Corporation
stating the reason for termination.  Upon
Termination For Cause, the Employee immediately shall be paid all accrued
salary, bonus compensation to the extent earned, vested deferred compensation,
if any (other than pension plan or profit sharing plan benefits which will be
paid in accordance with the applicable plan), any benefits under any plans of
Employer or Avocent in which the Employee is a participant to the full extent
of the Employee’s rights under such plans, accrued vacation pay and any
appropriate business expenses incurred by the Employee in connection with his
duties hereunder, all to the date of termination, but the Employee shall not be
paid any other compensation or reimbursement of any kind, including without
limitation, severance compensation.


 


2.4                                 TERMINATION
OTHER THAN FOR CAUSE.  Notwithstanding
anything else in this Agreement, the Employer may effect
a Termination Other Than For Cause at any time upon giving thirty (30) days
written notice to the Employee of such termination.  Upon any Termination Other Than For Cause,
the Employee shall immediately be paid all accrued salary, bonus compensation
to the extent earned, vested deferred compensation, if any (other than pension
plan or profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of Employer or Avocent in which
the Employee is a participant to the full extent of the Employee’s rights under
such plans, accrued vacation pay and any appropriate business expenses incurred
by the Employee in connection with his duties hereunder, all to the date of
termination, and all severance compensation provided in Section 4.2, but
no other compensation or reimbursement of any kind.


 


2.5                                 TERMINATION BY
REASON OF DISABILITY.  If, during the
term of this Agreement, the Employee, in the reasonable judgment of the Board
of Directors of Avocent Corporation, has failed to perform his duties under
this Agreement on account of illness or physical


 


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or
mental incapacity, and such illness or incapacity continues for a period of
more than six (6) consecutive months, the Employer shall have the right to
terminate the Employee’s employment hereunder by delivery of written notice to
the Employee at any time after such six month period and payment to the
Employee of all accrued salary, bonus compensation to the extent earned,
additional bonus compensation in an amount equal to the average annual bonus
earned by the Employee as an employee of Avocent Corporation and its affiliates
and predecessors in the two (2) years immediately preceding the date of
termination, vested deferred compensation, if any (other than pension plan or
profit sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of Employer or Avocent in which the
Employee is a participant to the full extent of the Employee’s rights under
such plans (including having the vesting of any awards granted to the Employee
under any AHC or Avocent stock option plans fully accelerated), accrued
vacation pay and any appropriate business expenses incurred by the Employee in
connection with his duties hereunder, all to the date of termination, with the
exception of medical and dental benefits which shall continue through the
expiration of this Agreement, but the Employee shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
severance compensation.


 


2.6                                 TERMINATION BY
REASON OF DEATH.  In the event of the
Employee’s death during the term of this Agreement, the Employee’s employment
shall be deemed to have terminated as of the last day of the month during which
his death occurs and the Employer shall pay to his estate or such beneficiaries
as the Employee may from time to time designate all accrued salary, bonus
compensation to the extent earned, vested deferred compensation, if any (other
than pension plan or profit sharing plan benefits which will be paid in
accordance with the applicable plan), any benefits under any plans of Employer
or Avocent in which the Employee is a participant to the full extent of the
Employee’s rights under such plans (including having the vesting of any awards
granted to the Employee under any AHC or Avocent stock option plans fully
accelerated), accrued vacation pay and any appropriate business expenses
incurred by the Employee in connection with his duties hereunder, all to the
date of termination, but the Employee’s estate shall not be paid any other
compensation or reimbursement of any kind, including without limitation,
severance compensation.


 


2.7                                 VOLUNTARY
TERMINATION.  Notwithstanding anything
else in this Agreement, the Employee may effect a
Voluntary Termination at any time upon giving thirty (30) days written notice
to the Employer of such termination.  In
the event of a Voluntary Termination, the Employer shall immediately pay all
accrued salary, bonus compensation to the extent earned, vested deferred
compensation, if any (other than pension plan or profit sharing plan benefits
which will be paid in accordance with the applicable plan), any benefits under
any plans of Employer or Avocent in which the Employee is a participant to the
full extent of the Employee’s rights under such plans, accrued vacation pay and
any appropriate business expenses incurred by the Employee in connection with
his duties hereunder, all to the date of termination, but no other compensation
or reimbursement of any kind, including without limitation, severance
compensation.


 


2.8                                 TERMINATION
UPON A CHANGE IN CONTROL.  In the event
of a Termination Upon a Change in Control, the Employee shall immediately be
paid all accrued salary, bonus compensation to the extent earned, vested
deferred compensation, if any (other than pension plan or profit sharing plan
benefits which will be paid in accordance with the applicable plan), any
benefits under any plans of Employer or Avocent in which the Employee is a
participant to the full extent of the Employee’s rights under such plans
(including having the vesting of any awards


 


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granted
to the Employee under any AHC or Avocent stock option plans fully accelerated),
accrued vacation pay and any appropriate business expenses incurred by the
Employee in connection with his duties hereunder, all to the date of
termination, and all severance compensation provided in Section 4.1, but
no other compensation or reimbursement of any kind.


 


2.9                                 REIMBURSEMENT OF RELOCATION
EXPENSES.  If Employee is terminated for
any reason (other than a Termination for Cause as defined in Section 2.1(a) or
a Voluntary Termination as defined in Section 2.1(c)) at any time prior to
September 1, 2007, Avocent agrees reimburse Employee for the reasonable
moving and relocation expenses actually incurred by Employee in relocating from
Huntsville, Alabama, to the Salt Lake City, Utah, area in an amount not to
exceed Fifty Thousand Dollars ($50,000).


 


3.                                       SALARY, BENEFITS AND BONUS COMPENSATION.


 


3.1                                 BASE SALARY.  Effective January 1, 2005, as payment
for the services to be rendered by the Employee as provided in Section 1
and subject to the terms and conditions of Section 2, the Employer agrees
to pay to the Employee a “Base Salary” at the rate of $180,000.00 per annum,
payable in equal bi-weekly installments. 
The Base Salary for each calendar year (or proration thereof) beginning January 1,
2005 shall be determined by the Board of
Directors of Avocent Corporation upon a recommendation of the Compensation Committee of Avocent
Corporation (the “Compensation Committee”), which shall authorize an increase
in the Employee’s Base Salary in an amount which, at a minimum, shall be equal
to the cumulative cost-of-living increment on the Base Salary as reported in
the “Consumer Price Index for All Urban
Consumers (CPI-U), All Items Index” for South Urban Size A, published by the
U.S. Department of Labor (using July 1, 2004, as the base date for
computation prorated for any partial year).  The Employee’s Base Salary shall
be reviewed annually by the Board of Directors and the Compensation Committee
of Avocent Corporation.


 


3.2                                 BONUSES.  The Employee shall be eligible to receive a
bonus for each calendar year (or portion thereof) during the term of this
Agreement and any extensions thereof, with the actual amount of any such bonus
to be determined in the sole discretion of the Board of Directors of Avocent
Corporation based upon its evaluation of the Employee’s performance during such
year.  All such bonuses shall be payable
during the last month of the fiscal year or within forty-five (45) days after
the end of the fiscal year to which such bonus relates.  All such bonuses shall be reviewed annually
by the Compensation Committee of
Avocent Corporation.


 


3.3                                 ADDITIONAL
BENEFITS.  During the term of this
Agreement, the Employee shall be entitled to the following fringe benefits:


 


(a)                                  THE EMPLOYEE
BENEFITS.  The Employee shall be eligible
to participate in such of Avocent’s benefits and deferred compensation plans as
are now generally available or later made generally available to executive
officers or Avocent, including, without limitation, stock option plans, Section 401(k)
plan, profit sharing plans, deferred compensation plan, annual physical
examinations, dental and medical plans, personal catastrophe and disability
insurance, retirement plans and supplementary executive retirement plans, if any.  For purposes of establishing the length of
service under any benefit plans or programs of AHC or Avocent, the Employee’s
employment with the Employer (or any successor) will be deemed to have
commenced on the date that Employee first commenced employment with AHC, which
was October 9, 2002.


 


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(b)                                 VACATION.  The Employee shall be entitled to vacation in
accordance with the Avocent Corporation’s vacation policy but in no event less
than three (3) weeks during each year of this Agreement.


 


(c)                                  LIFE
INSURANCE.  For the term of this
Agreement and any extensions thereof, the Employer shall at its expense procure
and keep in effect term life insurance on the life of the Employee, payable to
such beneficiaries as the Employee may from time to time designate, in an
aggregate amount equal to three times the Employee’s Base Salary.  Such policy shall be owned by the Employee or
by any person or entity with an insurable interest in the life of the Employee.


 


(d)                                 REIMBURSEMENT
FOR EXPENSES.  During the term of this
Agreement, the Employer or Avocent Corporation shall reimburse the Employee for
reasonable and properly documented out-of-pocket business and/or entertainment
expenses incurred by the Employee in connection with his duties under this
Agreement in accordance with Avocent’s standard reimbursement policies.


 


4.                                       SEVERANCE COMPENSATION.


 


4.1                                 SEVERANCE
COMPENSATION IN THE EVENT OF A TERMINATION UPON A CHANGE IN CONTROL.  In the event of a Termination Upon a Change in
Control, the Employee shall be paid as severance compensation his Base Salary
(at the rate payable at the time of such termination) for a period of twelve
(12) months from the date of such Termination Upon a Change in Control, on the
dates specified in Section 3.1, and the Employee shall also be paid an
amount equal to the average annual bonus earned by the Employee as an employee
of Avocent Corporation and its affiliates and predecessors in the two (2) years
immediately preceding the date of termination. 
Notwithstanding anything in this Section 4.1 to the contrary, the
Employee may in the Employee’s sole discretion, by delivery of a notice to the
Employer within thirty (30) days following a Termination Upon a Change in
Control, elect to receive from the Employer a lump sum severance payment by
bank cashier’s check equal to the present value of the flow of cash payments
that would otherwise be paid to the Employee pursuant to this Section 4.1.  Such present value shall be determined as of
the date of delivery of the notice of election by the Employee and shall be
based on a discount rate equal to the interest rate of 90-day U.S.
Treasury bills, as reported in The Wall Street Journal
(or similar publication), on the date of delivery of the election notice.  If the Employee elects to receive a lump sum
severance payment, Avocent Corporation shall cause the Employer to make such
payment to the Employee within ten (10) days following the date on which
the Employee notifies the Employer of the Employee’s election.  The Employee shall also be entitled to have
the vesting of any awards granted to the Employee under any AHC or Avocent
stock option plans fully accelerated. 
The Employee shall be provided with medical plan benefits under any
health plans of Avocent or Employer in which the Employee is a participant to
the full extent of the Employee’s rights under such plans for a period of
twelve (12) months from the date of such Termination Upon a Change in Control
(even if Employee elects to receive a lump sum severance payment).


 


4.2                                 SEVERANCE
COMPENSATION IN THE EVENT OF A TERMINATION OTHER THAN FOR CAUSE.  In the event of a Termination Other Than for
Cause, the Employee shall be paid as severance compensation his Base Salary (at
the rate payable at the time of such termination) for a period of twelve (12)
months from the date of such termination, on the dates 


 


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specified
in Section 3.1, and Employee shall also be paid an amount equal to the
average annual bonus earned by the Employee as an employee of Avocent
Corporation and its affiliates and predecessors in the two (2) years
immediately preceding the date of termination. 
Notwithstanding anything in this Section 4.2 to the contrary, the
Employee may in the Employee’s sole discretion, by delivery of a notice to the
Employer within thirty (30) days following a Termination Other Than for Cause,
elect to receive from the Employer a lump sum severance payment by bank cashier’s
check equal to the present value of the flow of cash payments that would
otherwise be paid to the Employee pursuant to this Section 4.2.  Such present value shall be determined as of
the date of delivery of the notice of election by the Employee and shall be
based on a discount rate equal to the interest rate on 90-day U.S.
Treasury bills, as reported in The Wall Street Journal
(or similar publication), on the date of delivery of the election notice.  If the Employee elects to receive a lump sum
severance payment, Avocent Corporation shall cause the Employer to make such
payment to the Employee within ten (10) days following the date on which
the Employee notifies the Employer of the Employee’s election.  The Employee shall also be entitled to have
the vesting of any awards granted to the Employee under any AHC or Avocent
stock option plans fully accelerated. The Employee shall be provided with
medical plan benefits under any health plans of Avocent or Employer in which
the Employee is a participant to the full extent of the Employee’s rights under
such plans for a period of twelve (12) months from the date of such Termination
Other Than for Cause (even if Employee elects to receive a lump sum severance
payment).


 


4.3                                 NO SEVERANCE
COMPENSATION UNDER OTHER TERMINATION.  In
the event of a Voluntary Termination, Termination For
Cause, termination by reason of the Employee’s disability pursuant to Section 2.5,
termination by reason of the Employee’s death pursuant to Section 2.6, the
Employee or his estate shall not be paid any severance compensation.


 


5.                                       NON-COMPETITION OBLIGATIONS.  Unless waived or reduced by the Employer or
Avocent, during the term of this Agreement, including any extensions or
renewals hereof, and (i) for
a period of twenty-four (24) months after the termination of this Agreement for
any reason that occurs prior to the fifth (5th) anniversary of the
Soronti Acquisition Date, or (ii) for
a period of twelve (12) months after the termination of this Agreement for any
reason that occurs after the fifth (5th) anniversary of the Soronti
Acquisition Date, the Employee will not, without the Employer’s and Avocent
Corporation’s prior written consent, directly or indirectly, alone or as a
partner, joint venturer, officer, director, employee, consultant, agent,
independent contractor or stockholder of any company or business, engage in any
business activity in the United States, Canada, Europe, or Asia which is
substantially similar to or in direct competition with any of the business
activities of or services provided by the Employer or Avocent at such
time.  Notwithstanding the foregoing, the
ownership by the Employee of not more than five percent (5%) of the shares of
stock of any corporation having a class of equity securities actively traded on
a national securities exchange or on The Nasdaq Stock Market shall not be
deemed, in and of itself, to violate the prohibitions of this Section 5.


 


6.                                       MISCELLANEOUS.


 


6.1                                 PAYMENT
OBLIGATIONS.  If litigation after a
Change in Control shall be brought to enforce or interpret any provision
contained herein, the Employer and Avocent Corporation, to the extent permitted
by applicable law and the Employer’s and Avocent Corporation’s Articles of
Incorporation and Bylaws, each hereby indemnifies the Employee for the Employee’s
reasonable attorneys’ fees and disbursements incurred in such litigation.


 


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6.2                                 GUARANTEE.  Avocent Corporation hereby unconditional and
irrevocable guarantees all payment obligations of the Employer under this
Agreement, including, without limitation, the Employer’s obligations under
Sections 2, 3, 4, and 6 hereof.


 


6.3                                 WITHHOLDINGS.  All compensation and benefits to the Employee
hereunder shall be reduced by all federal, state, local,
and other withholdings and similar taxes and payments required by applicable
law.


 


6.4                                 WAIVER.  The waiver of the breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach of the same or other provision hereof.


 


6.5                                 ENTIRE
AGREEMENT; MODIFICATIONS.  Except as otherwise
provided herein, this Agreement represents the entire understanding among the
parties with respect to the subject matter hereof, and this Agreement
supersedes any and all prior understandings, agreements (including the Original
Employment Agreement), plans and negotiations, whether written or oral with
respect to the subject matter hereof, and
any understandings, agreements or obligations respecting any past or future
compensation, bonuses, reimbursements or other payments to the Employee from
the Employer or Avocent Corporation; provided, however, that (i) the
Noncompetition Agreement dated November 4, 2004 among Avocent Corporation,
AHC, and Employee and (ii) the terms and conditions of the Confidential Information, Invention
Assignment, Noncompetition and Arbitration Agreement with AHC (then known as
Bear River Digital Corporation) relating to confidential information and
assignment of inventions (but not the other provisions thereof) shall remain in
full force in effect.  All modifications
to the Agreement must be in writing and signed by the party against whom
enforcement of such modification is sought.


 


6.6                                 NOTICES.  All notices and other communications under
this Agreement shall be in writing and shall be given by hand delivery or first
class mail, certified or registered with return receipt requested, and shall be
deemed to have been duly given upon hand delivery to an officer of the Employer
or the Employee, as the case may be, or upon three (3) days after mailing
to the respective persons named below:


 


	
  If to the
  Employer/Avocent:

  	
  Avocent
  Corporation

  
	
   

  	
  4991
  Corporate Drive

  
	
   

  	
  Huntsville,
  AL 35805

  
	
   

  	
  ATTN:
  President

  
	
   

  	
   

  
	
  With copy
  to:

  	
  Avocent
  Corporation

  
	
   

  	
  9911 Willows
  Road N.E.

  
	
   

  	
  Redmond, WA
  98052

  
	
   

  	
  ATTN:
  General Counsel

  
	
   

  	
   

  
	
  If to the
  Employee:

  	
  Stephen M.
  Daly

  



 


Any
party may change such party’s address for notices by notice duly given pursuant
to this Section 6.6.


 


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6.7                                 HEADINGS.  The Section headings herein are intended
for reference and shall not by themselves determine the construction or
interpretation of this Agreement.


 


6.8                                 GOVERNING LAW;
VENUE.  This Agreement shall be governed
by and construed in accordance with the laws of the State of Alabama.  The Employee, the Employer, and Avocent Corporation
each hereby expressly consents to the exclusive venue of the state and federal
courts located in Huntsville, Alabama, for any lawsuit arising from or relating
to this Agreement.


 


6.9                                 ARBITRATION.  Any controversy or claim arising out of or
relating to this Agreement, or breach thereof, shall be settled by arbitration
in Huntsville, Alabama, in accordance with the Rules of the American
Arbitration Association, and judgment upon any proper award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.  There shall be three (3) arbitrators,
one (1) to be chosen directly by each party at will, and the third
arbitrator to be selected by the two (2) arbitrators so chosen.  To the extent permitted by the Rules of
the American Arbitration Association, the selected arbitrators may grant
equitable relief.  Each party shall pay
the fees of the arbitrator selected by him and of his own attorneys, and the
expenses of his witnesses and all other expenses connected with the
presentation of his case.  The cost of
the arbitration including the cost of the record or transcripts thereof, if
any, administrative fees, and all other fees and costs shall be borne equally
by the parties.


 


6.10                           SEVERABILITY.  If a court or other body of competent jurisdiction
determines that any provision of this Agreement is excessive in scope or
otherwise invalid or unenforceable, such provision shall be adjusted rather
than voided, if possible, and all other provisions of this Agreement shall be
deemed valid and enforceable to the extent possible.


 


6.11                           SURVIVAL OF
EMPLOYER’S OBLIGATIONS.  The Employer’s
and Avocent Corporation’s obligations hereunder shall not be terminated by
reason of any liquidation, dissolution, bankruptcy, cessation of business, or
similar event relating to the Employer or Avocent Corporation.  This Agreement shall not be terminated by any
merger or consolidation or other reorganization of the Employer or Avocent
Corporation.  In the event any such
merger, consolidation or reorganization shall be accomplished by transfer of
stock or by transfer of assets or otherwise, the provisions of this Agreement
shall be binding upon and inure to the benefit of the surviving or resulting
corporation or person.  This Agreement
shall be binding upon and inure to the benefit of the executors,
administrators, heirs, successors and assigns of the parties; provided,
however, that except as herein expressly provided, this Agreement shall not be
assignable either by the Employer (except to an affiliate of the Employer
(including Avocent Corporation) in which event the Employer shall remain liable
if the affiliate fails to meet any obligations to make payments or provide
benefits or otherwise) or by the Employee.


 


6.12                           COUNTERPARTS.  This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one and the same
Agreement.


 


6.13                           INDEMNIFICATION.  In addition to any rights to indemnification
to which the Employee is entitled to under the Employer’s or Avocent
Corporation’s Articles of Incorporation and Bylaws, the Employer and Avocent
Corporation shall indemnify the Employee at all times during and after the term
of this Agreement to the maximum extent permitted under the corporation laws of
the State of Delaware and any other applicable state law, and shall pay the
Employee’s expenses in defending any civil or criminal action, suit, or proceeding
in advance of the final


 


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disposition of such
action, suit, or proceeding, to the maximum extent permitted under such
applicable state laws.


 


6.14                           INDEMNIFICATION
FOR SECTION 4999 EXCISE TAXES.  In
the event that it shall be determined that any payment or other benefit paid by
the Employer or Avocent Corporation to or for the benefit of the Employee under
this Agreement or otherwise, but determined without regard to any additional
payments required under this Amendment (the “Payments”) would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code (the “Excise
Tax”), then the Employer and Avocent Corporation shall indemnify the Employee
for such Excise Tax in accordance with the following:


 


(a)  The Employee shall be entitled to receive an
additional payment from the Employer and/or Avocent Corporation equal to (i) one
hundred percent (100%) of any Excise Tax actually paid or finally or payable by
the Employee in connection with the Payments, plus (ii) an additional
payment in such amount that after all taxes, interest and penalties incurred in
connection with all payments under this Section 2(a), the Employee retains
an amount equal to one hundred percent (100%) of the Excise Tax.


 


(b)  All determinations required to be made under
this Section shall be made by the Avocent Corporation’s primary
independent public accounting firm, or any other nationally recognized
accounting firm reasonably acceptable to the Avocent Corporation and the
Employee (the “Accounting Firm”). 
Avocent Corporation shall cause the Accounting Firm to provide detailed
supporting calculations of its determinations to the Employer and the
Employee.  All fees and expenses of the
Accounting Firm shall be borne solely by the Employer.  For purposes of making the calculations required
by this Section, the Accounting Firm may make reasonable assumptions and
approximations concerning applicable taxes and may rely on reasonable, good
faith interpretations concerning the application of Sections 280G and 4999 of
the Internal Revenue Code, provided the Accounting Firm’s determinations must
be made with substantial authority (within the meaning of Section 6662 of
the Internal Revenue Code). The payments to which the Employee is entitled
pursuant to this Section shall be paid by the Employer and/or Avocent
Corporation to the Employee in cash and in full not later than thirty (30)
calendar days following the date the Employee becomes subject to the Excise
Tax.


 


Signature page follows


 


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


 


	
   

  	
  AVOCENT
  HUNTSVILLE CORP.:

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John R.
  Cooper

  	
   

  
	
   

  	
  Its:

  	
  Chairman and
  CEO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  AVOCENT
  CORPORATION:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John R.
  Cooper

  	
   

  
	
   

  	
  Its:

  	
  Chairman and
  CEO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
  /s/ Stephen M. Daly

  	
   

  
	
   

  	
  Stephen M. Daly

  
					



 


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