**Exhibit 10.32**

 

[JNI LOGO]

 

JNI Corporation

10945 Vista Sorrento Parkway

San Diego, CA 92130

 

September 13, 2002

 

 

Paul Kim

 

Re:          Twelve-Month Retention Agreement

 

Dear Paul,

 

This letteroutlines JNI Corporation’s (“JNI”) Twelve-Month Retention Agreement (the“Agreement”) to be effective as of September 1, 2002, offered specifically toyou as a designated member of JNI’s senior management team by the Board ofDirectors.  JNI’s purpose in offeringyou this severance package is to ensure your continued full attention anddedication to the performance of your job duties and to provide you withcompensation upon an involuntary termination without Cause (as defined below)during the next twelve (12) months (September 1, 2002 through August 31, 2003,hereinafter referred to as the “Severance Period”).

 

1.                                       CurrentAgreements in Effect.  You continueto be employed by JNI as Chief Financial Officer on an at-will basis pursuantto the offer letter you signed dated September 18, 1999 (“Offer Letter”).  Nothing in this Agreement is intended to orshould be construed to contradict, modify or alter your at-will employmentrelationship with JNI.  You and JNI arealso parties to a Severance and Change of Control Agreement dated June 21, 2002(“Change of Control Agreement”), which provides for severance pay andaccelerated vesting of stock options if your employment terminates undercertain circumstances within twelve (12) months following a Change of Control(as that term is defined in the Change of Control Agreement).  Nothing in this Agreement is intended to orshould be construed to contradict, modify or alter the terms of the Change ofControl Agreement and the Change of Control Agreement shall continue in fullforce and effect.

 

2.                                       SeverancePackage.  Although you are employedat-will, in the event JNI terminates your employment without Cause during theSeverance Period and you are not eligible to receive the severance benefitsdescribed in the Change of Control Agreement, JNI agrees to provide you withthe following “Severance Package,” provided you comply with the conditions setforth in section 3 below:  a severancepayment equal to six (6) months of  yourbase salary then in effect, less all appropriate deductions, including federal,state and local income and employment taxes, payable in equal installments inaccordance with JNI’s regular payroll schedule.

 

3.                                       ConditionsTo Receive Severance Package.  TheSeverance Package described in section 2 above will be paid provided you meetthe following conditions: (a) you comply with all surviving provisions of anyconfidentiality or proprietary rights agreement signed by you in connectionwith your employment with JNI; (b) you execute a full general release, in aform acceptable to JNI, releasing all claims, known or unknown, that you mayhave against JNI, and any subsidiary or related entity, their officers,directors, shareholders, employees and agents, arising out of or any wayrelated to your employment or termination of employment with JNI or any acts,transactions or occurrences between you and JNI up through the date oftermination; and (c)  you are noteligible to receive the severance benefits described in the Change of ControlAgreement or any other plan, policy or agreement.

 

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4.                                       Definitionof Cause.  For purposes of thisAgreement, your employment will be considered terminated for “Cause” if thetermination is due to any of the following acts: (i) theft, dishonesty, orfalsification of any JNI records; (ii) improper disclosure of JNI’sconfidential or proprietary information or breach of JNI’s confidentiality orproprietary rights agreement; (iii) failure or inability to perform anyreasonably assigned duties after written notice and a reasonable opportunity tocure; or (iv) conviction of any criminal act that impairs your ability toperform your duties as an employee of JNI, as determined by JNI.

 

5.                                       NoOther Severance Benefits.  Youacknowledge and agree that the Severance Package provided pursuant to thisAgreement is in lieu of any other severance benefits for which you may beeligible under any other agreement, or any unearned or unvested incentivecompensation payments, and/or any other JNI severance plan or practice,including, but not limited to, any promises regarding severance set forth inthe Offer Letter, other than those severance benefits expressly set forth inthe Change of Control Agreement.  To theextent, however, you become eligible to receive the severance benefitsdescribed in the Change of Control Agreement, you shall not receive, nor beentitled to, the Severance Package described in this Agreement.  In no circumstance shall you receive theseverance benefits described in the Change of Control Agreement and  the Severance Package described in thisAgreement.

 

6.                                       GeneralProvisions.  If any provision ofthis Agreement is held by a court of competent jurisdiction to be invalid, voidor unenforceable, the remaining provisions shall nevertheless continue in fullforce and effect without being impaired or invalidated in any way.  In addition, the rights and obligations ofJNI under this Agreement shall inure to the benefit of and shall be bindingupon the successors and assigns of JNI. You shall not be entitled to assign any of your rights or obligationsunder this Agreement.  Finally, thisAgreement may be amended or modified only by a written instrument executed byboth parties hereto.  No oral waiver,amendment or modification will be effective under any circumstances whatsoever.

 

If the foregoing terms andconditions are entirely satisfactory to you, please date and sign below andreturn the original to me by September 20, 2002.

 

Sincerely,

 
| /s/ John C.  Stiska      |   |
|--------------------------|--------|
| By:  John C. Stiska |
| Chairman of  the Board   |

 

*     *     *

 

I have read this letteragreement in its entirely and agree to the terms and conditions containedherein.

 
| Dated: | 9/20/02 |     | /s/ Paul Kim |   |
|--------|---------|----------|--------------|--------|
|   |    | Paul Kim |
|        |         |          |              |        |  |

 

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