Exhibit 10.1


 


SEVERANCE AGREEMENT AND GENERAL RELEASE


 


This Severance Agreement and
General Release (including all Addenda hereto, the “Agreement”) is entered into
by and between 3Com Corporation, a Delaware corporation (“3Com” or the
“Company”) and Mark Slaven (the “Executive”). 
3Com and the Executive shall each individually be referred to herein as
a “Party” and together as the “Parties.”


 


WHEREAS, the Executive has
been employed with the Company as its Executive Vice President - Finance
(“EVP”) and Chief Financial Officer (“CFO”);


 


WHEREAS, the Parties have
mutually agreed that on or about August 13, 2004, following the filing of
the Company’s SEC Form 10-K for FY 2004, the Executive will step down as EVP
and CFO and will continue employment with the Company for a certain period in a
non-executive capacity in order to render services on various matters of
importance to 3Com;


 


WHEREAS, the Parties have
mutually agreed that the Executive’s employment with the Company will terminate
no later than December 31, 2004 in a manner that is amicable and
satisfactory to both Parties;


 


WHEREAS, the Executive may
be eligible to receive certain severance benefits as a result of his separation
from employment with the Company under the terms and conditions of his Management
Retention Agreement, as amended, and the Company’s Section 16 Officer
Severance Plan;


 


WHEREAS, the Executive
agrees to release the Company from any and all claims arising from or relating
to his employment with 3Com and the termination thereof;


 


NOW, THEREFORE, in
consideration of the mutual promises contained in this Agreement, the receipt
and sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:


 


1.                                       Transition of Employment Status.  The
Executive hereby agrees that his position as EVP and CFO will terminate
effective August 13, 2004 (“Transition Date”) and that he will use his
best efforts to fulfill his duties and responsibilities as EVP and CFO until
the Transition Date, including, without limitation, the completion and filing
of the Company’s SEC Form 10-K for FY 2004. 
Upon the Transition Date, the Executive will continue employment with
3Com in a non-executive capacity, the title and duties of which will be
determined by the Company’s Chief Executive Officer.  Effective as of the first regularly scheduled pay period
following the Transition Date, the Executive shall receive a base salary of
Three Thousand Nine Hundred and Six Dollars and Twenty-Five Cents ($3,906.25)
per semi-monthly pay period ($93,750.00 annualized), less all applicable taxes
and withholdings, commensurate with the 75% reduction in hours that the
Executive will be expected to work after the Transition Date in his
non-executive capacity.  The Company’s
payment and/or reimbursement of the Executive’s extended business commuting
expenses set forth in the letter agreement dated June 1, 2003 (as amended)
shall terminate effective as of the Transition Date.  3Com will reimburse the Executive for all authorized, reasonable
business and travel expenses incurred after the Transition Date in the course
of the Executive’s non-executive duties. 
The Executive shall not accrue any Personal Time Off (PTO) after the
Transition Date.  However, the Executive
shall continue to have the right to participate in the Company’s non-executive
benefits plans to the same extent and at the same levels that he is
participating as of the Transition Date. 
In addition, the Executive shall remain eligible to participate in the
Company’s 3Bonus program during the first half bonus period of the Company’s FY
2005 until his Termination Date in accordance with the terms and conditions of
the 3Bonus program.  The Executive’s
3Bonus award, if any, shall be calculated by applying the Company’s performance
multiplier for the first half of FY 2005 (to be determined at the Company’s
discretion based on the Company’s achievement of its corporate objectives and
financial measures) to the Executive’s full target bonus for the first half of
FY 2005.


 

















 


2.                                       Termination of Employment.  The
Executive agrees that his employment with the Company shall terminate effective
December 31, 2004 unless the Executive elects to terminate his employment
earlier than that date by providing at least fourteen (14) days’ advance
written notice to the Company’s Chief Executive Officer.  Upon the termination of the Executive’s
employment, the Executive will receive payment for all accrued, unused PTO at
his rate of pay immediately preceding the Transition Date.  The Executive’s last day of employment with
the Company shall be referred to herein as the “Termination Date”.


 


3.                                       Executive Severance Benefits.  In
consideration for and contingent upon his execution and non-revocation of this
Agreement, the Employee Agreement attached hereto as Addendum I, and the
Supplemental Release Agreement attached hereto as Addendum II (which shall be
executed no earlier than the Termination Date), the Company agrees to provide
the Executive with the following benefits:


 


a.                                       Severance Payment.  No
later than thirty (30) days following 3Com’s receipt of the Executive’s
executed copy of the Supplemental Release Agreement attached hereto as Addendum
II (which shall be executed no earlier than the Termination Date), the Company
shall make a lump sum severance payment to the Executive in the amount of Six
Hundred and Eighteen Thousand Seven Hundred and Fifty Dollars ($618,750.00),
less all applicable taxes and withholdings, payable via direct deposit through
the Company’s regular payroll practices. 
The gross amount of the severance payment shall include the Executive’s
annual base salary of Three Hundred and Seventy-Five Thousand Dollars
($375,000.00) and the Executive’s full annual target bonus of Two Hundred and
Forty-Three Thousand Seven Hundred and Fifty Dollars ($243,750.00).


 


b.                                      Benefits Continuation.  The
Executive is eligible to continue coverage for himself and his “qualified
beneficiaries” (as defined in Section 4980B of the federal Internal
Revenue Code, as amended) under the Company’s group medical, dental, and vision
insurance plans (“Health Care Plans”) in accordance with the Consolidated
Omnibus Budget Reconciliation Act of 1985 (“COBRA”), as amended.  If the Executive timely and properly elects
to continue coverage under the Company’s Health Care Plans, the Company shall
continue to pay the Company’s sponsored portion of the premiums for the
Executive’s elected coverage under the Health Care Plans until the earlier
of:  (1) the one (1) year anniversary of
the Executive’s Termination Date; or (2) the date upon which the Executive
(and/or his qualified beneficiaries) are covered under other group medical,
dental and/or vision insurance plans that provide Executive and/or his
qualified beneficiaries with comparable benefits and levels of coverage.  The Executive understands and agrees that he
is obligated to notify the Company’s Benefits Manager immediately of any such
comparable benefits and levels of coverage for himself and/or his qualified
beneficiaries.  The Executive shall be
responsible for the payment of the difference between the total insurance
premiums for the Executive’s elected coverage and the Company’s sponsored
portion in accordance with terms and procedures established by the Company at
its discretion.  Any such continuation
of coverage under the Health Care Plans shall be governed by COBRA and the
terms and conditions of the plan documents for the applicable Health Care
Plans.  The Executive understands and
agrees that if he elects to continue coverage for himself and/or his qualified
beneficiaries under the Health Care Plans after the one (1) year anniversary of
his Termination Date, the Executive shall be solely responsible to pay the full
amount of any and all premiums for such coverage.


 


c.                                       Life Insurance.  The
Company shall continue the Executive’s term life insurance coverage as of the
Termination Date and pay any and all premiums arising therefrom for the period
of one (1) year following the Executive’s Termination Date, subject to 3Com 


 


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obtaining a rider from the
Company’s life insurance carrier on commercially reasonable terms.


 


d.                                      Accelerated Vesting and Extended Exercise of
Stock Options.  Effective as of the Executive’s execution of
the Supplemental Release Agreement attached hereto as Addendum I (which shall
be executed no earlier than the Termination Date), all of the Executive’s
unvested stock options shall have their vesting accelerated by one year.  In addition, the exercise period for the
Executive’s vested stock options shall be extended to the earlier of:  (1) the one year anniversary of the
Executive’s Termination Date; or (2) the original term of the option
grant.  Except as provided in this
Section 3(d), the Executive’s stock options shall be governed by the terms
and conditions of the applicable plan documents and the Executive’s stock
option agreements.  The Executive
understands and agrees that he is required to make arrangements reasonably
satisfactory to the Company to facilitate the Company’s compliance with all
federal and state tax and withholding requirements as a condition to exercising
his vested stock options, and receiving his restricted stock and/or other
Company-issued equity compensation.


 


4.                                       Payment for Golden Parachute Excise Taxes.  In
the event that any severance benefits provided to the Executive pursuant to
Section 3 above (a) constitute “parachute payments” within the meaning of
Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”), (b) are subject to any excise tax imposed under Section 4999 of
the Code, and (c) the aggregate value of such parachute payments, as determined
in accordance with Section 280G of the Code and the applicable regulations
issued by the U.S. Department of the Treasury, is equal to or greater than the
product obtained by multiplying 3.59 by the Executive’s “base amount” as
defined by Section 280G(b)(3) of the Code, then the Executive shall
receive: (i) a payment from the Company sufficient to pay such excise tax; and
(ii) an additional payment from the Company sufficient to pay any excise tax and
the federal and state income and employment taxes arising from the payment made
by the Company pursuant to subsection (i) above.


 


5.                                       Release of Claims.   In
exchange for the executive severance benefits set forth in Section 3
above, the Executive hereby irrevocably and unconditionally releases 3Com and
its parents, subsidiaries, predecessors, successors, affiliates and joint
ventures, and all of their directors, officers, employees, representatives,
attorneys, agents, insurers, assigns, employee benefit programs (and the
trustees, administrators, fiduciaries, and insurers of such programs), and any
other persons acting by, through, under, or in concert with any of the persons
or entities identified above (the “Released Parties”) from all known and unknown
claims, promises, debts, obligations, causes of action, or similar rights of
any type, in law or in equity, that the Executive has, had or may have had
arising from or relating to his employment with 3Com and the termination
thereof (“Claims”).  The Executive
understands that the Claims that he is hereby releasing include, but are not
limited to:


 


a.               Any and all Claims that in any way arise from
or relate to the Executive’s employment with 3Com or the termination of that
employment, such as claims for compensation, bonuses, commissions, benefits,
reimbursements, lost wages, or unused accrued PTO;


 


b.              Any and all Claims that in any way arise from
or relate to the design or administration of any employee benefit program;


 


c.               Any and all Claims that arise from or relate
to any severance or similar benefits or to post-employment health or group
insurance benefits not expressly set forth in Section 3 above, including
without limitation any and all Claims to benefits or compensation under the
Executive’s Management Retention Agreement, as amended, and the Company’s
Section 16 Officer Severance Plan;


 


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d.              Any and all Claims based on a contract, any
employment or wrongful discharge claims or tort claims, and any and all Claims
based on a federal, state or local law, regulation or ordinance, including, but
not limited to, Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act, the Employee Retirement Income Security Act, the Worker
Adjustment Retraining and Notification Act, the Fair Labor Standards Act,
Massachusetts General Laws ch. 151B, all as may have been amended, and any
other federal, state, or local common law, statute, regulation, or ordinance of
any other type or kind.


 


The Executive understands
that he is hereby releasing Claims that he may not know about.  Notwithstanding anything to the contrary
contained in this Agreement, the Executive’s release of Claims under this
Section 4 does not constitute a waiver by the Executive of any rights or
benefits that he may have pursuant to (i) this Agreement, (ii) the Company’s
401(k) Plan, and (iii) to any right of indemnification or contribution against
the Company under applicable insurance policies, statutory law or Company
by-laws, if any, to the same extent available to any other officer of the
Company for any third-party claim against him arising from his employment as an
officer of the Company.


 


6.                                       Rights under the Age Discrimination in
Employment Act.  The Executive acknowledges that he has been
advised by this Agreement that (a) he should consult with an attorney of his
choosing prior to executing this Agreement or the Addenda attached hereto; (b)
he has been given twenty-one calendar (21) days within which to consider and
execute this Agreement and to the extent that he signs this Agreement prior to
the completion of that period he has waived the remainder of that period; (c)
that he has seven (7) calendar days following the execution of this Agreement
to revoke his signature; and (iv) the Effective Date of this Agreement shall be
the eighth (8th) calendar day following his execution of this
Agreement.


 


7.                                       No Assignment of Claims.  The
Executive expressly warrants that he has not assigned any Claim or Claims that
he has, had or may have had against any of the Released Parties to any other
person or entity.


 


8.                                       Tax Consequences.  The
Company makes no representations or warranties with respect to the tax
consequences of the provision of the executive severance benefits set forth in
Section 3 above.  The Executive
understands and agrees that the Company will apply the applicable,
supplemental, state and federal tax rates to the severance payments made
pursuant to Sections 3(a) and 3(b) above. 
The Executive further understands and agrees that he is solely
responsible for the payment, if applicable, of any other local, state, or
federal taxes or withholdings based on the provision of the executive severance
benefits by the Company and any penalties or assessments thereon and the
Executive hereby agrees to indemnify the Company for any such taxes or
withholdings, and any penalties, costs and/or attorneys’ fees arising
therefrom.


 


9.                                       Employment Agreement Restrictions.  The
Executive agrees that his obligations and the Company’s rights and remedies under
the Employment Agreement signed by the Executive, the terms and conditions of
which are expressly incorporated into this Agreement, shall remain in full
force and effect upon his execution of this Agreement and the Supplemental
Release Agreement, and after the Termination Date.  The Executive hereby warrants and represents that he is in
compliance with and has not violated the Employment Agreement.


 


10.                                 Cooperation.  The
Executive hereby agrees to cooperate with the Company and its legal counsel
(internal and external) as the Company may reasonably request at any time in
connection with any investigation or litigation relating to any matter in which
the Executive was involved during, or has material knowledge of as a result of,
his employment with the Company; provided, however, that the Company will
attempt to reasonably accommodate the Executive’s schedule and other
commitments.


 


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11.                                 Confidentiality.  The
Executive understands and agrees that this Agreement and each and every
provision contained herein, including without limitation the existence of this
Agreement and executive severance benefits, is confidential and shall not be
disclosed to any person or entity, for any reason, without the prior written
consent of the Company, unless required by law.  It is agreed, however, that the Executive may reveal the contents
of this Agreement to members of his immediate family, and to his legal and
financial advisors, subject to his securing their agreement to maintain the
confidentiality of such information.  If
the Executive is required by a government entity, a lawfully issued subpoena
and/or otherwise required by law to disclose the existence or terms of this
Agreement, the Executive agrees to notify the Company in writing no fewer than
ten (10) calendar days prior to the date of such disclosure.


 


12.                                 Return of Company Property.  The
Executive hereby agrees that he will return to 3Com all Company property and
equipment in his possession or control, including but not limited to all files,
documents, data and records (whether on paper or in tapes, disks, or other
machine-readable form), office equipment, credit cards, and employee
identification cards.  He further
warrants and confirms that he will leave intact all electronic Company
documents, including those that he developed or helped develop during his
employment.


 


13.                                 Entire Agreement.  This
Agreement and the Employee Agreement attached hereto as Addendum I contain all
the agreements and promises by and between 3Com and the Executive and supersede
any prior agreements or representations between them as to the subjects
covered, including, without limitation, the Executive’s offer letter,
Management Retention Agreement (as amended) the letter agreement regarding
reimbursement of business commuting expenses (as amended) and any agreements
arising under or relating to the Company’s equity compensation and welfare
benefit plans.  The Parties agree that
no covenants, agreements, representations, or warranties of any kind whatsoever
have been made by either Party, except as specifically set forth in this
Agreement and the Employee Agreement. 
Should any portion, term, or provision of this Agreement or the Employee
Agreement be declared or determined by any court or other tribunal to be
illegal, invalid or unenforceable, the validity of the remaining portions,
terms and provisions shall not be affected thereby, and the illegal, invalid or
unenforceable portion, term or provision shall be deemed not to be part of this
Agreement or the Employee Agreement, as applicable.  This Agreement is binding upon and will inure to the benefit of
the Executive and 3Com and their heirs, administrators, representatives,
executors, successors, and assigns.


 


14.                                 Voluntary Agreement.  The
Executive warrants that he has carefully read and understands the provisions of
this Agreement; that he has had sufficient time to consider the Agreement
before signing it; that he is entering into this Agreement knowingly and
voluntarily, intending that it will have binding legal effect; and that he has
been advised by 3Com to consult with an attorney of his own choice and at his
own expense concerning the terms of this Agreement prior to signing it.


 


15.                                 Waiver.  Any waiver by either Party of
any violation, breach of or default under any provision of this Agreement or
any other agreements provided for or incorporated herein, by the other Party
shall not construed as, or constitute, a continuing waiver of such provision,
or waiver of any other violation of, breach of or default under any other
provision of this Agreement or any other agreements provided for or
incorporated herein.


 


16.                                 Costs.  The Parties shall each bear
their own costs, attorneys’ fees and other expenses incurred in connection with
this Agreement. 


 


17.                                 Governing Law and Venue.  This
Agreement shall be governed by the laws of the Commonwealth of Massachusetts,
excluding its laws relating to the choice of laws.  The Parties hereby agree and consent to the jurisdiction of the
state and federal courts of the Commonwealth of Massachusetts as the exclusive
jurisdiction for settling any disputes arising hereunder.


 


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18.                                 Amendments.  This Agreement may not be
modified, amended, supplemented or superseded unless by means of a written
document signed by the Executive and the Company’s Chief Executive Officer or
General Counsel.


 


19.                                 Counterparts.  This
Agreement may be executed in counterparts, and each counterpart shall have the
same force and effect as an original and, taken together, shall constitute an
effective, binding agreement by the Parties.


 


WHEREFORE, the Parties have
read this Agreement, have carefully considered its provisions, have had an
opportunity to discuss it with their attorneys, and attest that they are fully
competent to execute this Agreement and that they fully understand and
knowingly accept its terms and conditions in their entirety and without
reservation.


 


 


	
  /s/
  Mark Slaven

  	
   

  	
  /s/
  Bruce L. Claflin

  	
   

  	
   

  
	
  Mark Slaven

  	
   

  	
  3Com Corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  July 21, 2004

  	
   

  	
  Bruce L. Claflin

  	
   

  
	
  Date

  	
   

  	
  Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  President and Chief
  Executive Officer

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  July 21, 2004

  	
   

  
	
   

  	
   

  	
  Date

  	
   

  



 


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ADDENDUM II


 


SUPPLEMENTAL RELEASE AGREEMENT


 


WHEREAS, 3Com Corporation
(“3Com” or the “Company”) and Mark Slaven (the “Executive”) have mutually
agreed that the Executive’s employment with 3Com has terminated effective
                        
(“Termination Date”);


 


WHEREAS, the Executive is
eligible to receive certain severance benefits as a result of his separation
from employment with the Company;


 


WHEREAS, the Executive
agrees to release the Company from any and all claims arising from or relating
to his employment with 3Com and the termination thereof;


 


NOW, THEREFORE, in
consideration of the mutual promises contained in this Agreement, the receipt
and sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:


 


1.                                       Termination of Employment.  The
Executive’s understands and agrees that his employment with the Company
terminated as of the Termination Date and that he has no further duties,
responsibilities, powers, or authority with respect to the Company, its
business or financial operations.


 


2.                                       Payment of Salary, Wages and Benefits.  The
Executive acknowledges and agrees that the Company has paid all salary, wages,
bonuses, accrued vacation and PTO, business expense reimbursements, and any and
all other compensation and benefits due to him by Company as a result of his
employment with the Company.


 


3.                                       Executive Severance Benefits.  Upon
the Executive’s execution and non-revocation of this Supplemental Release
Agreement, the Company shall provide the Executive with the executive severance
benefits set forth in Section 3 of the Severance Agreement and General
Release signed by the Executive on
                        .


 


4.                                       Release of Claims.  In
exchange for the executive severance benefits set forth in Section 3 of
the Severance Agreement and General Release, the Executive hereby irrevocably
and unconditionally releases 3Com and its parents, subsidiaries, predecessors,
successors, affiliates and joint ventures, and all of their directors,
officers, employees, representatives, attorneys, agents, insurers, assigns,
employee benefit programs (and the trustees, administrators, fiduciaries, and
insurers of such programs), and any other persons acting by, through, under, or
in concert with any of the persons or entities identified above (the “Released
Parties”) from all known and unknown claims, promises, debts, obligations,
causes of action, or similar rights of any type, in law or in equity, that the
Executive has, had or may have had arising from or relating to his employment
with 3Com and the termination thereof (“Claims”).  The Executive understands that the Claims that he is hereby
releasing include, but are not limited to:


 


a.               Any and all Claims that in any way arise from
or relate to the Executive’s employment with 3Com or the termination of that
employment, such as claims for compensation, bonuses, commissions, benefits,
reimbursements, lost wages, or unused accrued PTO;


 


b.              Any and all Claims that in any way arise from
or relate to the design or administration of any employee benefit program;


 


c.               Any and all Claims that arise from or relate
to any severance or similar benefits or to post-employment health or group
insurance benefits not expressly set forth in Section 3 of the Severance
Agreement and General Release, including without limitation any and 


 


7

















 


all Claims to benefits or
compensation under the Executive’s Management Retention Agreement, as amended,
and the Company’s Section 16 Officer Severance Plan;


 


d.              Any and all Claims based on a contract, any
employment or wrongful discharge claims or tort claims, and any and all Claims
based on a federal, state or local law, regulation or ordinance, including, but
not limited to, Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act, the Employee Retirement Income Security Act, the Worker
Adjustment Retraining and Notification Act, the Fair Labor Standards Act,
Massachusetts General Laws ch. 151B, all as may have been amended, and any
other federal, state, or local common law, statute, regulation, or ordinance of
any other type or kind.


 


The Executive understands
that he is hereby releasing Claims that he may not know about.  Notwithstanding anything to the contrary
contained in this Agreement, the Executive’s release of Claims under this
Section 4 does not constitute a waiver by the Executive of any rights or
benefits that he may have pursuant to (i) this Agreement, (ii) the Company’s
401(k) Plan, and (iii) any right of indemnification or contribution against the
Company under applicable insurance policies, statutory law or Company by-laws,
if any, to the same extent available to any other officer of the Company for
any third-party claim against him arising from his employment as an officer of
the Company.


 


5.                                       Covenant Not to Sue.  The
Executive expressly warrants and agrees that he has not as of the date of this
Supplemental Release Agreement filed or maintained and will not in the future
file or maintain any lawsuit, claim or action of any kind whatsoever against
the Released Parties nor will he cause or knowingly permit any such lawsuit,
claim or action to be filed or maintained on his behalf in any federal, state
or municipal court, administrative agency or other tribunal relating to any
Claim(s) released pursuant to Section 4 of this Agreement.  In the event that the Executive brings any
action in contravention of this covenant not to sue, he understands and agrees
that he shall be required to repay 3Com the consideration described in
Section 3(a) of the Severance Agreement and General Release, regardless of
the outcome of the legal action.


 


6.                                       Return of Company Property.  The
Executive hereby warrants and confirms that he has returned to 3Com all Company
property and equipment in his possession or control, including but not limited
to all files, documents, data and records (whether on paper or in tapes, disks,
or other machine-readable form), office equipment, credit cards, and employee
identification cards.  He further
warrants and confirms that he has left intact all electronic Company documents,
including those that he developed or helped develop during his employment.  To the extent that the Executive had
electronic Company documents in his possession or control through a personal
computer, he further warrants and certifies that he has permanently destroyed
all such files.


 


WHEREFORE, the Executive has
read this Supplemental Release Agreement, has carefully considered its
provisions, have had an opportunity to discuss it with an attorney, and attests
that he is fully competent to execute this Supplemental Release Agreement and
that he fully understands and knowingly accepts its terms and conditions in
their entirety and without reservation.


 


Dated as of this
                
day of
                         
2005.


 


 


	
   

  	
   

  
	
  Mark Slaven

  	
   

  



 


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