**Exhibit 10.2**

 

July 5, 2006

 

Mr. John McCormack

20791 Via Corta

San Jose, CA  95120

 

Dear Mr. McCormack:

 

We are pleased to offer you a position with Websense, Inc. Thisletter summarizes the offer’s terms and conditions.  This offer is contigent upon the successfulcompletion of a background check.

 

Websense agrees to employ you in the position of Senior Vice President, Product Development,beginning July 17, 2006.  Your beginningsalary while employed by Websense will be $10,576.92 biweekly.  An additional 25% of your basecompensation may be earned as part of a quarterly and year-end bonus, basedupon completion of our corporate objectives. Your job is exempt, which means you are not subject tothe minimum wage and overtime provisions of the Federal Fair Labor StandardsAct (FLSA).

 

Websensewill provide a relocation bonus of $150,000 upon hire, to be used toward thereimbursement of incremental expenses incurred by your move to San Diego.  This reimbursement is subject to payroll taxand withholding requirements.

 

Upon entering into a contract for the sale of your home in San Jose or thepurchase of a home in San Diego, Websense will provide a secondrelocation bonus of $175,000 to be used toward the reimbursement of incrementalrelocation expenses.  This reimbursementis subject to payroll tax and withholding requirements.

 

Websensewill directly pay the cost of transporting your personal belongings to SanDiego through our relocation program (estimated value per moving companyTBD).  These costs must be approved byWebsense’s Human Resources department before they are incurred.  In the event you need to move your householdgoods twice in a two year time frame (two years from your start of employmentat Websense), Websense will directly pay the cost of the two moves.

 

Should youterminate your employment with Websense within one year of joining, all movingexpenses must be repaid to the company.

 

----

 

In addition to your cash compensation, you will also receive anon-qualified stock option to purchase 200,000shares of Websense common stock subject to Board approval.  One quarter of your option will cliff vestone year after the grant date, with the remaining options vesting monthly forthe remaining three years.  Your optionexercise price is the closing price of Websense’s common stock on the day youremployment begins.

 

In the event the Company terminates your employment other than forCause as defined below, you will receive severance pay in the form of sixmonths of base salary paid in six equal monthly installments, less standarddeductions and withholdings.  Theseverance benefits are contingent upon you providing the Company with afully-effective waiver and release of claims in a form satisfactory to theCompany and your compliance with the Company’s standard non-competition andnon-solicitation requirements.

 

“Cause” for termination shall mean atermination of your employment by the Company based upon a good faithdetermination by the Company that one or more of the following has occurred: (a) yourcommission of a material act of fraud with respect to the Company, (b) yourintentional refusal or willful failure to carry out the reasonable instructionsof the Company, (c) your conviction of, or plea of nolo contendere to, atany time, a misdemeanor crime of moral turpitude or a felony (even if such hasoccurred prior to your employment with the Company), (d) your grossmisconduct in connection with the performance of your duties, or (e) yourmaterial breach of your obligations to the Company or any agreement between youand the Company.

 

If the Company determines that any cash severance payment benefitpayable to you fails to satisfy the distribution requirement of Section 409A(a)(2)(A) ofthe Internal Revenue Code of 1986, as amended (the “Code”), as a result of Section 409A(a)(2)(B)(i) ofthe Code, then the payment schedule will be modified as follows:  If acceleration of the benefit will avoidapplication of Section 409(a)(1) of the Code, then the Company willaccelerate the payment of the benefit to the minimum extent necessary so thatthe benefit is not subject to the provisions of Section 409A(a)(1) ofthe Code.  If acceleration of the benefitwould not avoid the application of Section 409A(a)(1) of the Code,however, then the Company will delay the benefit to the minimum extentnecessary so that the benefit is not subject to the provisions of Section 409A(a)(1) ofthe Code.  If any payments are delayed asa result of the previous sentence, all such delayed payments shall becomepayable in a lump sum on the first day they can be paid following thetermination date.  Thereafter, paymentswill resume in accordance with the payment schedule set forth in thisletter.  The Company may attachconditions to or adjust the severance amounts paid to preserve, as closely aspossible, the economic consequences that would have applied in the absence ofthese requirements; *provided, however*,that no such condition or adjustment shall result in the payments being subjectto Section 409A(a)(1) of the Code.

 

Included in your compensation is acomprehensive benefits package: life, long-term disability, dental, vision,medical insurance, an optional 401(k) savings plan, Employee StockPurchase 

 

2

----

 

Plan (ESPP) cafeteria (flex 125) plan,health club discount membership, and Employee Assistance Plan.  Websense, Inc.pays 90% of your health and dental premiums and 70% of the premiums for yourdependents.  You are eligible to participate in the Websense insuranceplans the first day of the month following your date of hire. Inaddition, you will receive fifteen days of accrued paid vacation per twelvemonth period, ten days of holiday pay and five days of sick leave per year.  It is understood that you will take a twoweek vacation in August of 2006. That time may be unpaid, or you may use as yet un-accrued vacation time.

 

As an employee of Websense, Inc., you will be required to complywith all company policies and procedures. In particular, you will be required to familiarize yourself with and tocomply with Websense, Inc.’s policy prohibiting unlawful harassment anddiscrimination and the policy concerning drugs and alcohol.  Violations of these policies may lead toimmediate termination of employment.  Allemployees are required to sign a proprietary invention agreement as a conditionof employment.  In addition, and inaccordance with the Federal Immigration Reform Act of 1986, our offer iscontingent upon your being able to furnish, on the first day you report towork, documents which verify both your identity and eligibility for employmentin the United States.  The list ofacceptable documents is included as an attachment to this letter.

 

Websense reserves the right to change or eliminate any or all of itsbenefits at any time.  Websense is an “atwill” employer.  This means that you mayterminate your employment at Websense at any time for any reason whatsoever,simply by notifying Human Resources. Likewise, Websense may terminate your employment at any time for anyreason whatsoever, with or without cause or advance notice.  This at will employment relationship cannotbe changed except in writing signed by the Chief Executive Officer ofWebsense.  The employment terms in thisletter supersede any other agreements or promises made to you by anyone,whether oral or written.

 

If this letter accurately reflects your understanding of thisemployment relationship, please sign below to indicate your acceptance, andreturn it to me no later than July 11, 2006.  If you would like to fax this letter back tome, please fax it to my confidential fax number: (858) 458-2953.  We look forward to having you join our team!

 

3

----

 

Sincerely,

 
| /s/ Susan Brown                                    |   |
|----------------------------------------------------|--------|
| Susan Brown, SPHR                                  |
| Vice President, Human Resources and Administration |
| Websense, Inc.                                |

 

 
| Accepted By:       |   |         |
|--------------------|--------|--------------|
|               |   |         |
| /s/ John McCormack |   | July 5, 2006 |
| John McCormack     |   | Date         |

 

4

----