**Exhibit 10.38**

 

Keith Cornell

 

 

Re:          Compensationfor Board Service and Change of Control Agreement

 

Dear Keith**:**

 

Thank you for yourcontinuing service as a member of the Board of Directors of IntellisyncCorporation (“Intellisync” or the “Company”). As we have discussed, Intellisync would like you to continue yourservice on its Board of Directors and its committees, and has agreed tocontinue and extend certain benefits to you. Especially in light of recent legislation that has given rise to increasinginvolvement by our Board, Intellisync is pleased to offer you the benefitsdescribed in this letter.  Capitalizedterms are defined on Schedule 1, attached.

 

1.             Compensationfor Board Participation and for Attendance at Board and Committee Meetings.   For so long as you remain a non-employee memberof the Board, you shall receive compensation on the terms and conditions consistentwith similarly situated non-employee members of the Board as described on Schedule 2,attached.

 

2.             Accelerationof Vesting.  As you know, Intellisynchas periodically granted you options to purchase shares of its CommonStock.  Upon a Change of Control, youwill automatically receive accelerated vesting of all outstanding stock optionsthen held by you, and you shall be released from any outstanding Companyrepurchase options on any shares of Common Stock then held by you, includingshares purchased after the date of this letter.

 

3.             Successors.  Any successor to the Company (whether director indirect and whether by purchase, lease, merger, consolidation, liquidationor otherwise) to all or substantially all of the Company’s business and/orassets shall assume the obligations under this letter and agree expressly toperform the obligations under this letter in the same manner and to the sameextent as the Company would be required to perform such obligations in theabsence of a succession.  For allpurposes under this letter, the term “Company” shall include any successor tothe Company’s business and/or assets which executes and delivers the assumptionagreement described in this Section 3 or which becomes bound by the termsof this letter by operation of law.

 

4.             LawGoverning; Arbitration.  This lettershall be governed by and construed in accordance with the laws of the State ofCalifornia. Any dispute or controversy arising under or in connection with thisletter shall be settled exclusively in arbitration conducted in Santa ClaraCounty, California, in accordance with the rules of the AmericanArbitration Association then in effect. Judgment may be entered on the arbitrator’s award in any court havingjurisdiction.  Punitive damages shall notbe awarded.  In any arbitrationproceeding, the party determined to be the prevailing party will be entitled toreceive, in addition to any other award, its attorneys’ fees and expenses ofthe proceeding.

 

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5.             Employmentand Income Taxes.  All payments madepursuant to this letter will be subject to withholding of applicable employmentand income taxes, if any.

 

Ofcourse, each member of the Board serves at the pleasure of the stockholders andnothing in letter is intended to confer any rights upon you to remain a memberof the Board.  This letter supercedes andreplaces any previous agreements between you and the Company regarding thesubject matter hereof.

 

Byyour signature below, you indicate that you agree to the terms set out in thisletter.

 

Verytruly yours,

 

 

INTELLISYNCCorporation

 

 
| By:                       | /s/ KEITH KITCHEN |   |
|---------------------------|-------------------|--------|
| Keith Kitchen             |
| Chief Financial Officer   |
|                      |
|                      |
| ACKNOWLEDGED AND  AGREED: |
|                      |
|                      |
| /s/ KEITH CORNELL         |              |
| Keith Cornell             |
|                      |
|                      |
| Date:                     | 8/24/05           |   |
|                           |                   |        |  |

 

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# **SCHEDULE 1**

 

Definition ofTerms.  The followingterms referred to in this letter shall have the following meanings:

 

*“Changeof Control”* means the occurrence of any of the followingevents:

 

(a) Any “person” (as such term is used in Sections 13(d) and 14(d) of theSecurities Exchange Act of 1934, as amended), excluding existing beneficialowners as of the date of this letter, is or becomes the “beneficial owner” (asdefined in Section 13d-3 of said Act), directly or indirectly, ofsecurities of the Company representing 50% or more of the total voting powerrepresented by the Company’s then outstanding voting securities, excludingconversion of any convertible securities issued as of the date of this letter;

 

(b) The composition of the Board of Directors changes during any period of 36months that follows the date of this letter, such that individuals who, at thebeginning of the period, were members of the Board of Directors (the “ContinuingDirectors”), cease for any reason to constitute at least a majority thereof;unless at least 50% of the Continuing Directors has either (i) approvedthe election of the new Directors, (ii) if the election of the newDirectors is voted on by stockholders, recommended that the stockholders votefor approval, or (iii) otherwise determined that such change incomposition does not constitute a Change of Control, even if the ContinuingDirectors do not constitute a quorum of the whole Board (it being understoodthat this requirement shall not be capable of satisfaction unless there is atleast one Continuing Director); or

 

(c) The stockholders of the Company approve a merger or consolidation of theCompany with any other corporation, other than a merger or consolidation whichwould result in the voting securities of the Company outstanding immediatelyprior thereto continuing to represent (either by remaining outstanding or bybeing converted into voting securities of the surviving entity) at least 50% ofthe total voting power represented by the voting securities of the Company orsuch surviving entity outstanding immediately after such merger orconsolidation, or the stockholders of the Company approve a plan of complete liquidationof the Company or an agreement for the sale or disposition by the Company ofall or substantially all of the Company’s assets.

 

Any other provision ofthis schedule notwithstanding, the term Change of Control shall notinclude either of the following events undertaken at the election of theCompany:

 

(i) Any transaction, the sole purpose of which is to change the state of theCompany’s incorporation; or

 

(ii) A transaction, the result of which is to sell all or substantially all of theassets of the Company to another corporation (the “surviving corporation”)provided that the surviving corporation is owned directly or indirectly by thestockholders of the Company immediately following such transaction insubstantially the same proportions as their ownership of the Company’s commonstock immediately preceding such transaction.

 

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# **SCHEDULE 2**

 

### Schedule of Non-Employee Director Compensation

 

1.     Intellisync shall pay each non-employee Boardmember annual compensation in the amount of Twenty Thousand Dollars($20,000),  to be paid in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every yearthereafter; provided in each case that the Director’s service shall not haveterminated for any reason (including death or disability) prior to any suchquarterly payment date.

 

2.     Intellisync shall pay the non-employeeChairman of the Board an additional Fifteen Thousand Dollars ($15,000) to bepaid in equal quarterly installments, commencing on August 1, 2005, andcontinuing every year thereafter; provided in each case that the Director’sservice as Chairman of the Board shall not have terminated for any reason(including death or disability) prior to any such quarterly payment date.

 

3.     Intellisync shall pay the non-employee BoardCommittee Chairman of the Audit Committee an additional Twenty Thousand Dollars($20,000) annually to be paid in equal quarterly installments, commencing on August 1,2005, and continuing every year thereafter; provided in each case that theDirector’s service as Board Committee Chairman shall not have terminated forany reason (including death or disability) prior to any such quarterly paymentdate.

 

4.     Intellisync shall pay every othernon-employee Board Committee member of the Audit Committee an additional SevenThousand Five Hundred Dollars ($7,500) annually to be paid in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every year thereafter;provided in each case that the Director’s service as Board Committee membershall not have terminated for any reason (including death or disability) priorto any such quarterly payment date.

 

5.     Intellisync shall pay the non-employee BoardCommittee Chairman of the Compensation Committee an additional Seven ThousandFive Hundred Dollars ($7,500) annually to be paid in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every yearthereafter; provided in each case that the Director’s service as BoardCommittee Chairman shall not have terminated for any reason (including death ordisability) prior to any such quarterly payment date.

 

6.     Intellisync shall pay every othernon-employee Board Committee member of the Compensation Committee an additionalFive Thousand Dollars ($5,000) annually to be paid in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every yearthereafter; provided in each case that the Director’s service as BoardCommittee member shall not have terminated for any reason (including death ordisability) prior to any such quarterly payment date.

 

7.     Intellisync shall pay the non-employee BoardCommittee Chairman of the Nomination and Governance Committee an additionalSeven Thousand Five Hundred Dollars ($7,500) annually to be paid in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every yearthereafter; provided in each case that the Director’s service as BoardCommittee Chairman shall not have terminated for any reason (including death ordisability) prior to any such quarterly payment date.

 

8.     Intellisync shall pay every othernon-employee Board Committee member of the Nomination and Governance Committeean additional Five Thousand Dollars ($5,000) annually to be paid

 

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in equal quarterlyinstallments, commencing on August 1, 2005, and continuing every yearthereafter; provided in each case that the Director’s service as BoardCommittee member shall not have terminated for any reason (including death ordisability) prior to any such quarterly payment date.

 

9.     Intellisync shall pay the non-employee BoardCommittee Chairman of the Special Strategy Committee an additional TwentyThousand Dollars ($20,000) with Ten Thousand Dollars ($10,000) due upon theestablishment of the Committee, and the final Ten Thousand Dollars ($10,000) dueupon the termination of the Special Strategy Committee.

 

10.   Intellisync shall pay every othernon-employee Board Committee member of the Special Strategy Committee anadditional Ten Thousand Dollars ($10,000) with Five Thousand Dollars ($5,000)due upon the establishment of the Committee, and the final Five ThousandDollars ($5,000) due upon the termination of the Special Strategy Committee.

 

11.   Intellisync shall pay each non-employee Boardmember One Thousand Dollars ($1,000) cash upon adjournment of each regularlyscheduled Board meeting that such Board member attends in person and inentirety.

 

12.   Intellisync shall pay each non-employee Boardmember Five Hundred ($500) cash upon adjournment of each regularly scheduledBoard meeting that such Board member is either unable to attend in person, oris not required to attend in person, but otherwise attends telephonically andin entirety.

 

13.   Intellisync shall pay each non-employee BoardCommittee Chairperson or member cash in the amount shown in the following tableunder the columns titled “In Person” upon adjournment of each regularlyscheduled meeting of each Committee of the Board of Directors that such BoardCommittee member attends in person and in entirety or cash in the amount shownin the following table under the columns titled “By Phone” within a reasonabletime upon adjournment of each regularly scheduled meeting of each Committee ofthe Board of Directors that such Board Committee member is unable to attend inperson, or is not required to attend in person, but otherwise attendstelephonically and in entirety.  TheCorporation shall make reasonable efforts to schedule Committee meetingsimmediately prior to or after regularly scheduled Board meetings.

 
| ** **  | ** ** | **Audit Committee** | ** ** | **Compensation  Committee** | ** ** | **Nomination and  Governance  Committee** | ** ** | **Special Strategy  Committee** | ** ** |
|-------------|------------|---------------------|------------|-----------------------------|------------|-------------------------------------------|------------|---------------------------------|------------|
| ** **  | ** ** | **In  Person**      | ** ** | **By  Phone**               | ** ** | **In  Person**                            | ** ** | **By  Phone**                   | ** ** | **In  Person** | ** ** | **By  Phone** | ** ** | **In  Person** | ** ** | **By  Phone** | ** ** |
| Chairperson |       | $                   | 1,500      |                        | $          | 750                                       |       | $                               | 1,000      |   | $ | 750 |   | $ | 1,000 |   | $ | 750 |   | $ | 1,000 |   | $ | 750 |   |
| Member      |       | $                   | 1,000      |                        | $          | 500                                       |       | $                               | 750        |   | $ | 500 |   | $ | 750 |   | $ | 500 |   | $ | 750 |   | $ | 500 |   |

 

14.   Intellisync shall pay and reimburse thenon-employee Board members for reasonable expenses, including travel andlodging, in conjunction with Board and Committee meeting attendance, as well asfor activities and customer meetings as requested by Intellisync management.

 

Intellisyncreserves the right to change the compensation set forth in this schedule atany time, by resolution of the Board of Directors, or a duly authorizedcommittee thereof.

 

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