exv10w31



 





Exhibit 10.31




Novell, Inc.

Letter of Understanding





			
	Date:	 	August 1, 2006






			
	To:	 	Tom Francese






			
	From:	 	Ron Hovsepian, President/CEO

Alan Friedman, Senior Vice President People






			
	Re:	 	Terms and Conditions of your Long-Term International Assignment





Dear Tom,




This Letter of Understanding (hereafter “Letter”) confirms the terms and conditions concerning your
International Assignment to the EMEA region on behalf of Novell, Inc. (“Novell”). This Letter is to
be read in conjunction with your Offer Letter dated August 31, 2005 and executed by you on
September 2, 2005 (the “Offer Letter”).



Your Home Location will remain Irving, Texas, Virtual Office Employee, U.S. with significant
travel around the EMEA region. The assignment is anticipated to be for two years, as agreed upon
between you and Ron Hovsepian, President and CEO (the “CEO”).



Your job title will be Senior Vice President, President Novell EMEA Operations, reporting to the
CEO. For the duration of this assignment, you will remain on the United States payroll and will
continue to receive your salary payment and benefits from the United States. Accordingly, your
current salary and benefits will remain in effect as listed in the Offer Letter and you remain
eligible to receive salary increases following periodic review by the CEO and the Novell
Compensation Committee of the Board of Directors. Host Country holidays and hours of operation
shall apply.



The Severance Agreement between you and Novell, Inc. dated October 3, 2005 (the “Severance
Agreement”) shall remain in effect unless otherwise agreed to by you to be modified in order to
comply with Internal Revenue Code section 409A.



RELOCATION BENEFITS:




Novell has secured the services of a relocation vendor, Hewitt Mobility to assist its employees
on international assignments. All relocation benefits are administered via Hewitt Mobility.
Janice Jones is the Relocation Consultant for Novell. Please contact her with any
relocation-related questions. She may be reached via email at Janice.Jones@novell.com or via phone
at 781-464-8189.



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You will receive the following relocation benefits for the duration of this assignment as outlined
in the Offer Letter.




	 	•	 	Per page two of the Offer Letter, an annual cash allowance of USD$250,000.00
GROSS (less applicable tax withholding), which is intended to compensate you for a portion
of your expenses associated with your housing, car, cost of living in the assignment
location, and the continuation of your residence in Texas.
	 
	 	•	 	Per page two of the Offer Letter, Novell will reimburse you for the cost of you
and your dependents to travel to or from the United States, up to a maximum reimbursement
of USD$24,000 NET (Novell pays applicable taxes) per year, subject to your submission of
receipts to Hewitt Mobility, Novell’s relocation vendor.
	 
	 	•	 	For the duration of the assignment, Novell will directly pay for the cost of
storing those of your household goods that currently are being stored by Hewitt Mobility in
the United States for the duration of the assignment. Novell will also pay the vendor
directly to move these goods out of storage and to a location designated by you. However,
once the goods are moved out of storage , any additional fees associated with accessing
these stored goods shall be at your own expense and must be paid directly by you to the
vendor.
	 
	 	•	 	Per page three of the Offer Letter, at the end of your assignment Novell will
reimburse you for the costs associated with your move back to the United States, up to a
maximum of USD$50,000 NET (Novell pays applicable taxes), provided you submit appropriate
documentation to receive reimbursement in accordance with Novell’s reimbursement policies.
	 
	 	•	 	If Novell requests and you agree to return to the United States for the purpose
of accepting a different position or assignment, you will be offered the core relocation
benefits package per the applicable Novell relocation policy at that time.
	 
	 	•	 	Novell will supply annual tax preparation in the US and in foreign locations
where required based on your work-days in such countries, including pre-assignment tax
consultation. All tax preparation and consultation shall be provided by a Certified Public
Accounting firm of Novell’s choosing (the “CPA firm”).





By entering into this agreement, you acknowledge and agree that the CPA firm is being retained to
provide professional services both to Novell and to you, and that Novell shall have the right to
review the underlying details of your tax returns to the extent reasonably necessary to ensure
compliance with Novell policies and programs.



Should you return to the U.S. at the end of the assignment, all relocation benefits including your
annual cash allowance of USD$250,000 GROSS, dependent travel reimbursement up to USD$24,000 NET,
and household goods storage will be terminated upon your return. The tax consultation and
preparation benefit will be terminated effective the tax year following your return to the U.S.,
provided there are no carry-over tax issues that need to be addressed.



STATUS AS AN AT-WILL EMPLOYEE:



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While your employment with Novell is for no particular duration and is at-will, meaning that Novell
or you may terminate the employment relationship at any time, with or without cause and with or
without prior notice, you will be entitled to receive certain severance benefits in accordance with
your severance agreement. However, it may be the case that the local law in any applicable EMEA
country may override this “at will” employment arrangement. If and only to the extent that local
law requires any notice of termination or post-employment benefits, such required benefits shall
offset any severance or separation pay or other benefits to which you may otherwise be entitled
under any Novell plan or agreement. Therefore, nothing contained in this Agreement is intended to
modify the “at-will” nature of your employment nor the terms and conditions of your severance
agreement.



NOVELL U.S. PROCESS & POLICIES APPLY:




During your assignment, you will remain on the U.S. payroll and U.S. benefits plans. As such, all
Novell, Inc. U.S. policies apply to you and your activities in the EMEA region. No medical,
dental, housing, car, pension or any other benefit of any kind shall be distributed or administered
or paid by any other Novell legal entity. You acknowledge and agree that you are not entitled to
any duplicate benefit to those you receive from Novell, Inc. U.S. and that you will not request
payment or reimbursement of a duplicate benefit, either from Novell or from the local country
entity. Similarly, all expense reports and requests for reimbursement of business related expenses
shall comply with Novell, Inc. procedures and policies and shall be entered using Novell’s expense
reimbursement process and must list an authorized U.S. based individual as the approving manager.
During business travel, all airline tickets, hotel reservations and car rental must be reserved and
purchased via Novell, Inc. Travel Department or the Host Country’s travel reservations and purchase
process. However, regardless of the method of purchase, all business travel airline tickets, hotel
reservations and car rental must be purchased pursuant to Novell, Inc.’s current business travel
policy.



PLEASE REVIEW:




By entering into this Agreement, it is not Novell’s intent to become subject to the law of any
foreign jurisdiction and the parties agree that neither party will assert that foreign law applies
or commence legal or equitable action so asserting. The parties explicitly agree and acknowledge
that this Agreement, and the provision of services under this Agreement, are intended to be
governed by the internal laws of the Commonwealth of Massachusetts.



CHANGES AMENDMENTS AND GAPS:




Any changes or amendments to this Letter – including this provision – not made in writing are
invalid.



The provisions of this Letter are subject at any time to revision to comport with Home Country or
other requirements, as determined by Novell in its sole discretion.



If any stipulations of this Letter are invalid or contain gaps, this shall not affect the validity
of



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the remaining provisions. The parties agree to replace any provisions, which are invalid or
contain gaps, with such stipulations that come closest to the economically intended effect.



(Remainder of Page Intentionally Left Blank)




Please signify acceptance of this offer by signing the “Acceptance and Acknowledgment” attached to
this Letter. Return the signed copies of these documents to Janice Jones in the Novell Human
Resources Department and retain any copies for your files.



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Signatures




All individuals below understand and agree to the contents of this letter.



	 	 	 	 	 
	 

	 	/s/ Tom Francese
	 	Aug. 23, 2006
	 

	 	 

Tom Francese
	 	Date
	 
	 	 	 	 
	 

	 	/s/ Ron Hovsepian
	 	August 24, 2006
	 

	 	 

Ron Hovsepian
	 	Date
	 
	 	 	 	 
	 

	 	/s/ Alan Friedman
	 	Aug. 2, 2006
	 

	 	 

Alan Friedman
	 	Date






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ACCEPTANCE AND ACKNOWLEDGEMENT




I accept the at-will international employment from Novell as set forth in the attached letter. I
understand and acknowledge that, unless local law provides to the contrary, my employment with
Novell is for no definite duration and is at-will, meaning that Novell or I may terminate the
employment relationship at any time, with or without prior notice.



I understand and agree that the terms and conditions set forth in this Letter, the Offer Letter,
the Severance Agreement and the Novell, Inc. Intellectual Property and Nondisclosure Agreement
executed by me (the “IP Agreement”) represent the entire agreement between Novell and me,
superseding all prior negotiations and agreements, whether written or oral. I understand that the
terms and conditions described in the above-listed documents are the terms and conditions of my
employment. No one other than Novell’s Senior Vice President of People or the CEO of Novell is
authorized to enter into any agreement with me which modifies the terms of the above-listed
documents, and any such modification must be in writing and signed by either such executive. In
addition, I understand that any promotions, increases in compensation and/or offers regarding other
positions must be in writing and signed by my manager and the appropriate individual in the Human
Resources Department As a condition of my continued at-will employment with Novell I understand and
agree that I will be required to abide by the Company’s policies and procedures.



	 	 	 
	/s/ Thomas M. Francese
 

Signature

	 	 
	 
	 	 
	Thomas M. Francese
 

Printed Name

	 	 
	 
	 	 
	Aug. 23, 2006
 

Date

	 	 







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