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**Exhibit 10.1**

 

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**EMPLOYMENTAGREEMENT**

 

**THIS EMPLOYMENT AGREEMENT**(this “**Agreement**”)is by and between **Vyyo Inc**., aDelaware corporation (the “**Company**”), and **Walter Ungerer**(“**Ungerer**”).

 

                                                In connection with Ungerer’s employmentwith the Company, the Company and Ungerer desire to enter into this Agreementaccording to the terms and conditions set forth below.

 

                                                **NOW, THEREFORE,** the parties hereto hereby agree asfollows:

 

1.                                      **EmploymentDuties**.

 

                                                a.                                      **General**.  The Company hereby agrees to employ Ungerer,and Ungerer hereby agrees to accept employment with the Company, on the termsand conditions set forth below, which change shall be effective as of September1, 2007 (the “Effective Date”).

 

                                                b.                                      **Company’sDuties**.  The Company shall allow Ungererto, and Ungerer shall, perform responsibilities normally incident to his positionof Executive Vice President, Corporate Strategy and Investor Relations, commen­suratewith his background, education, experience and professional standing.  The Company shall provide Ungerer with suchoffice equipment, supplies, customary services and cooperation suitable for theperformance of his duties.

 

                                                c.                                       **Ungerer’sDuties**.  Ungerer shall devote such timeas necessary to fully perform his services as Executive Vice President, CorporateStrategy and Investor Relations and shall report directly to the Company’s ChiefExecutive Officer. The parties acknowledge that Ungerer will perform his dutiesfrom the Company’s facility in Norcross, Georgia, and shall be required to travelto the Company’s other facilities and other locations as the Company’s businessdictates.

 

2.                                      **Term**.  The initial term of this Agreement is twoyears (the “**Initial****Term**”).  There­after, this Agreement may be renewed byUngerer and the Company on such terms as the parties may agree to inwriting.  Absent written notice oftermination of this Agreement given by one party to the other party not lessthan 30 days prior to the end of the Initial Term or any Renewal Term (asdefined below), this Agreement will be automatically renewed for a one-yearextension (each such extension a “**Renewal Term**”and the Initial Term together with any and all Renewal Terms, the “**Term**”).  Notwithstandingthe foregoing, this Agreement is subject to earlier termination as providedherein.

 

 

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3.                                      **Compensation**.  Ungerer shall be compensated as follows:

 

                                                a.                                      **Salary**.  Ungerer shall receive an annual salary of TwoHundred Ten Thousand Dollars ($210,000). The Company agrees to review the salary on or before December 31, 2008,and thereafter at the end of each calendar year during the Term based upon Ungerer’sservices and the financial results of the Company, and to make such changes asmay be determined appropriate in the sole discretion of the Company’sCompensation Committee or Board of Directors. Ungerer’s annual salary shall be payable on a semi-monthly basis, inaccordance with the Company’s usual payroll practices.

 

                                                b.                                      **BonusCompensation**.  During eachcalendar year in the Initial Term, Ungerer may become eligible to participatein the Company’s bonus programs based on performance objectives to be agreed toby Ungerer and the Company’s Chief Executive Officer.  Any bonus earned by Ungerer in a particularcalendar year will be paid by the Company in the manner and time period agreedto by the parties.  The bonus shall beprorated should Ungerer’s employment terminate prior to a full calendar year.

 

                                                c.                                       **StockOptions**.  The Company’s management willrecommend to the Company’s Board of Directors or Compensation Committee that Ungererbe granted a stock option to purchase 30,000 shares of the Company’s capitalstock at the next regularly scheduled quarterly meeting.  If approved, the stock options would begranted with an exercise price equal to fair market value of the Company’scommon stock on the date of grant and would be governed by the terms of anoption agreement setting forth the vesting schedule of such shares (equalmonthly installments over 48 months).  Ifthere is any conflict between this Agreement and the terms of the option agreement,the terms of the option agreement will control.

 

                                                d.                                      **PaidTime-Off**.  Ungerershall accrue paid time-off in accordance with the terms of the Company’s paidtime-off policy.  Ungerer shall becompensated at his usual rate of base compen­sation during any such paidtime-off.  Ungerer shall be entitled topaid holi­days as generally given by the Company and shall receive sick leaveor disability leave in accordance with the terms of the Company’s standard sickleave or disability leave policy.

 

                                                e.                                       **Benefits**.  Ungerer shall be entitled to participate inany group plans or programs maintained by the Company for any employeesrelating to group health, disability, life insurance and other related benefitsas in effect from time to time subject to the terms and conditions of suchplans. Ungerer shall also be entitled to director and officer insurance in suchamounts and coverage and such indemnification provisions as are afforded otherofficers and directors of the Company.  Theforegoing benefits shall be paid by the Company.

 

                                                f.                                        **Expenses**.  The Company shall reim­burse Ungerer for hisnormal and reasonable expenses incurred for travel, entertainment and similaritems in promoting and carrying out the Company’s business in accordance withthe Company’s general policy as adopted from time to time.  In addition, Ungerer shall be reimbursed forthe reasonable costs associated with cellular telephone usage and shall beentitled to reimbursement for such reasonable continuing professionaleducation, memberships and certifications as are deemed normal and appropriatefor executive officers as determined by the Company.  As a condition of

 

 

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paymentor reimbursement, Ungerer agrees to provide the Company with copies of allavailable invoices and receipts, and otherwise account to the Company insufficient detail to allow the Company to claim an income tax deduction forsuch paid item, if such item is deductible. Reimbursements shall be made on a monthly or more frequent basis in accordancewith the Company’s reimbursement policies then in effect.

 

4.                                      **Confidentialityand Competitive Activities**.  Ungerer agrees to execute the Company’s currentform of  employee proprietary informationand inventions agreement, which will include provisions related toconfidentiality of Company information, assignment of inventions,non-competition and non-solicitation of customers and employees.

 

5.                                      **Termination**.

 

                                                a.                                      **Terminationwithout Cause; Voluntary Termination**.  The Company may terminate this Agreement and Ungerer’semployment hereunder without Cause (as defined below) and with or without priorreview or warning by providing 60 days prior written notice to Ungerer.  Ungerer may volun­tarily terminate his employ­mentat any time upon 60 days’ prior written notice to the Company.

 

                                                b.                                      **Terminationfor Cause**.  The Companymay immedi­ately terminate Ungerer’s employment at any time for Cause.  Termin­ation for Cause shall be effectivefrom the receipt of written notice thereof to Ungerer­ specifying the groundsfor termination.  “**Cause**”shall be deemed to include:  (i) Ungerer’swillful misconduct, or failure to perform, his material duties provided that Ungereris given written notice setting forth with reasonable specificity suchmisconduct or failure and Ungerer fails to correct such behavior within 30 daysfollowing receipt of notice; (ii) Ungerer’s conviction of a felony offense orconviction for any unlawful act which would be materially detrimental to theCompany’s reputation, or a material act of dishonesty, moral turpitude, fraud,embezzlement, misappropriation or financial dishonesty against the Company; or(iii) Ungerer’s breach of any material provision of this Agreement, includinghis obligations under Section 8(a), or breach of his employee proprietaryinformation agreement. The Company’s exercise of its rights to terminate with Causeshall be without prejudice to any other remedies it may be entitled at law, inequity or under this Agreement.

 

                                                c.                                       **TerminationUpon Death or Disability**.  ThisAgree­ment shall automatic­ally terminate upon Ungerer’s death.  In addition, if any disability or incapacityof Ungerer to perform his duties as the result of any injury, sickness, orphysical, mental or emotional condition continues for a period of 30 days(excluding any accrued paid time-off) out of any 120 calendar day period, the Companymay terminate Ungerer’s employ­ment upon written notice.  Payment of salary to Ungerer during any sickleave shall only be to the extent that Ungerer has accrued paid time-off.

 

6.                                      **SeverancePayment Upon Termination of Employment**.  The severance payment set forth below shallbe in addition to any amounts owed to Ungerer as earned but unpaid wagesthrough the date of termination and accrued but unused vacation through thedate of termination.

 

 

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                                                a.                                      **TerminationWithout Cause**.  If theCompany terminates this Agreement without Cause prior to the end of the InitialTerm, the Company shall pay Ungerer a severance payment equal to six months ofhis annual salary (without bonus), payable over such period in accordance withthe Company’s usual payroll practices.  Forthe avoidance of doubt, the six months of severance provided for in thisSection 6(a) shall include the 60 days of notice required by Section 5(a)regarding termination without Cause.

 

                                                b.                                      **Executionof Release**.  Ungereragrees that Ungerer’s right to receive any severance payment is conditioned onthe prior execution by Ungerer of a binding general release (in such form asthe Company may determine) of any and all claims against the Company and anyaffiliates, and their respective officers, directors, employees or otheragents.

 

7.                                      **CompensationUpon a Change of Control**.

 

                                                a.                                      **Changeof Control Termination**.  Upona Change of Control Termination (as defined below), Ungerer shall be entitledto the following compensation:

 

                                                                                                (i)                                     **CashPayment**.  In lieu of any severancepayment described above in Section 6, payment in cash of an amount equal to thesum of one times Ungerer’s then current annual salary as in effect for thecalendar year in which the Change of Control Termination occurs, payable inaccordance with the Company’s usual payroll practices.

 

                                                                                                (ii)                                  **StockOptions**.  Any stock options granted to Ungererthat are outstanding immediately prior to but are not vested as of the date ofthe Change of Control Termination shall become 100% vested as of the date ofthe Change of Control Termination.

 

                                                                                                (iii)                               **Benefits**.  For a period of one year following Ungerer’sdate of termination, the continuation of the same or comparable life, health,disability, vision, hospitalization, dental and other insurance coverage as Ungererwas receiving immediately prior to the Change of Control.

 

                                                b.                                      **Offerof Employment with Successor**.  If upon a Change of Control Ungerer isoffered employment by the Company’s successor with responsibilities substantiallysimilar to that contemplated by this Agreement and Ungerer does not accept suchoffer, 33.3% of the stock options granted to Ungerer that are outstandingimmediately prior to but are not vested as of the date of the Change of Controlshall become vested as of the date of the Change of Control.

 

                                                c.                                       **Employmentwith Successor**.  If upon aChange of Control Ungerer accepts employment with the Company’s successor withresponsibilities substantially similar to that contemplated by this Agreement,33.3% of the stock options granted to Ungerer that are outstanding immediatelyprior to but are not vested as of the date of the Change of Control shallbecome vested as of the date of the Change of Control. If Ungerer terminateshis employment for Good Reason (as defined below) with the Company’s successoron or after the 6-month anniversary of commencement of such employment, allremaining stock options granted to Ungerer that are outstanding immediatelyprior to but are not vested as of the date of his termination for Good Reason shallbecome vested as of the date of such termination.

 

 

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                                                d.                                      For thepurposes of this Section, “**Change of Control**”means the occurrence of any of the following events:

 

                                                                                                (i)                                     any “person”(as such term is used in Sections 13(d) and 14(d) of the Securities ExchangeAct of 1934, as amended) becomes the “beneficial owner” (as defined in Rule13d-3 under said Act), directly or indirectly, of securities of the Companyrepresenting 50% or more of the then outstanding shares of the Company’s commonstock or the total voting power represented by the Company’s then outstandingvoting securities (other than pursuant to a Business Combination which iscovered by clause (iii) below);

 

                                                                                                (ii)                                  theconsummation of the sale or other disposition (including in whole or in partthrough licensing arrangement(s)) of all or substantially all of the Company’sassets, other than sales, other dispositions or licenses of assets made to aparent or a wholly-owned subsidiary of the Company, or an entity under commoncontrol with the Company;

 

                                                                                                (iii)                               theconsummation of a reorganization, merger, statutory share exchange orconsolidation or similar transaction involving the Company or the acquisitionof assets or stock of another entity by the Company or any of its subsidiaries,or a series of related such transactions (each, a “**BusinessCombination**”), in each case unless following such BusinessCombination (A) the voting securities of the Company outstanding immediatelyprior thereto continue to represent (either by remaining outstanding or bybeing converted into voting securities of the surviving entity or any entity (a“**Parent**”) that, as a result of suchtransaction, owns the Company or the surviving entity or all or substantiallyall of the Company’s or surviving entity’s assets directly or through one ormore subsidiaries) at least 50% of the total voting power represented by the Company’svoting securities or such surviving entity or Parent outstanding immediatelyafter such Business Combination; and (B) no person (excluding any entityresulting from such Business Combination or a Parent or any employee benefitplan (or related trust) of the Company or such entity resulting from suchBusiness Combination or Parent) beneficially owns, directly or indirectly, 50%or more of, respectively, the then-outstanding shares of common stock of theentity resulting from such Business Combination or the total voting power ofthe then-outstanding voting securities of such entity, except to the extentthat the ownership in excess of 50% existed prior to the Business Combination; or

 

                                                                                                (iv)                              approval by theCompany’s stockholders of a complete liquidation or dissolution of the Companyother than in the context of a transaction or series of related transactionsthat would not constitute a Change of Control under clause (iii) above.

 

                                                e.                                       For thepurposes of this Section, a “**Change of ControlTermination**” shall mean a termination of employment within one yearfollowing a Change of Control where the Company or a party effecting a Changeof Control of the Company terminates Ungerer’s employment without Cause, otherthan as the result of Ungerer’s death or disability.

 

 

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                                                f.                                        For thepurposes of this Section, “**Good Reason**”shall exist if Ungerer terminates his employment within 60 days of theoccurrence of any of the following:  (i)a material adverse change in his position or title; or (ii) a reduction in hisbase salary from that provided in this Agreement unless the reduction affectsall employees generally.

 

8.                                      **CorporateOpportunities**.

 

                                                a.                                      **Duty toNotify**.  In the event that during theTerm Ungerer shall become aware of any material and significant businessopportunity directly related to any of the Company’s significant businesses, Ungerershall promptly notify the Company’s Board of Directors of suchopportunity.  Ungerer shall not appropriatefor himself or for any other person other than the Company, or any affiliate ofthe Company, any such opportunity unless, as to any particular opportunity, theBoard of Directors fails to take appropriate action within 90 days.  Ungerer’s duty to notify the Company and torefrain from appropriating all such opportunities for 90 days shall neither belimited by, nor shall such duty limit, the application of the general law of Georgiarelating to the fiduciary duties of an agent or employee.

 

                                                b.                                      **Failureto Notify**.  In theevent that Ungerer fails to notify the Company of, or so appropriates, any suchopportunity without the express written consent of the Company, Ungerer shallbe deemed to have violated the provisions of this Section notwith­standing (i)the capacity in which Ungerer shall have acquired such opportunity; or (ii) theprobable success in the Company’s hands of such opportunity.

 

9.                                      **Miscellaneous**.

 

                                                a.                                      **EntireAgreement**.  ThisAgreement constitutes the entire agreement and understanding between theparties with respect to the subject matters herein, and supersedes and replacesany prior agreements and understandings, whether oral or written between themwith respect to such matters.  Theprovisions of this Agreement may be waived, altered, amended or repealed inwhole or in part only upon the written consent of both parties to thisAgreement.

 

                                                b.                                      **NoImplied Waivers**.  The failureof either party at any time to require performance by the other party of anyprovision hereof shall not affect in any way the right to require such per­form­anceat any time thereafter, nor shall the waiver by either party of a breach of anyprovision hereof be taken or held to be a waiver of any subsequent breach ofthe same provision or any other provision.

 

                                                c.                                       **PersonalServices**.  It isunderstood that the services to be performed by Ungerer hereunder are personalin nature and the obligations to perform such services and the conditions andcovenants of this Agreement cannot be assigned by Ungerer.  This Agreement shall inure to the benefit ofand bind the successors and assigns of the Company.

 

                                                d.                                      **Severability**.  If for any reason any provision of thisAgreement shall be determined to be invalid or inoperative, the validity andeffect of the other provisions hereof shall not be affected thereby.

 

 

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                                                e.                                       **ApplicableLaw**.  This Agreement shall begoverned by and construed in accordance with the laws of the State of Georgiawithout regard to conflict of law principles.

 

                                                f.                                        **Notices**.  All notices, requests, demands, instruc­tionsor other communications required or permitted to be given under this Agreementshall be in writing and shall be deemed to have been duly given upon delivery,if delivered personally, or if given by prepaid telegram, or mailedfirst-class, postage prepaid, registered or certified mail, return receiptrequested, shall be deemed to have been given 72 hours after such delivery, ifaddressed to the other party at the addresses as set forth on the signature pagebelow.  Either party hereto may changethe address to which such communications are to be directed by giving writtennotice to the other party hereto of such change in the manner above provided.

 

 

 

 

 

 

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

 

 
| **VYYO INC.**                        | ** **                              | **WALTER UNGERER**                   |
|--------------------------------------|-----------------------------------------|--------------------------------------|
| 188 Inverness Drive  West, Suite 140 |                                    | 6625 The Corners  Parkway, Suite 100 |
| Englewood, Colorado 80112            |                                    | Norcross, Georgia 30092              |
|                                 |                                    |                                 |
|                                 |                                    |                                 |
| By:                                  | /s/ Wayne H. Davis                      |                                 | /s/ Walter Ungerer |   |
|                                 | Wayne H. Davis, Chief Executive Officer |                                 | (Signature) |
|                                 |                                    |                                 |
| Date: November 8, 2007               |                                    | Date: November 8, 2007               |

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

****SIGNATURE PAGE TO UNGERER EMPLOYMENTAGREEMENT****

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