Document:

Change in Control Agreement

 
Exhibit 10.19

 
CHANGE IN CONTROL AGREEMENT

 
THIS CHANGE IN CONTROL AGREEMENT
(“Agreement”) is entered into effective as of December 18, 2002, by and between VARIAN, INC., a Delaware corporation (the “Company”)1, and Martin O’Donoghue, an employee of the Company (“Employee”). 
 
The Company’s Board of Directors (the “Board”) has determined that it is in the best interest of the Company and its
stockholders for the Company to agree to pay Employee termination compensation in the event Employee should leave the employ of the Company under the circumstances described below. The Board recognizes that the possibility of a proposal from a third
person, whether or not solicited by the Company, concerning a possible “Change in Control” of the Company (as such language is defined in Section 3(d)) will be unsettling to Employee. Therefore, the arrangements set forth in this Agreement
are being made to help assure a continuing dedication by Employee to Employee’s duties to the Company notwithstanding the proposal or occurrence of a Change in Control. The Board believes it imperative, should the Company receive any proposal
from a third party, that Employee, without being influenced by the uncertainties of Employee’s own situation, be able to assess and advise the Board whether such proposals are in the best interest of the Company and its stockholders, and to
enable Employee to take action regarding such proposals as the Board might determine to be appropriate. The Board also wishes to demonstrate to key personnel that the Company desires to enhance management relations and its ability to retain and, if
needed, to attract new management, and intends to ensure that loyal and dedicated management personnel are treated fairly. 
 
In view of the foregoing, the Company and Employee agree as follows: 
 

	 1.	  	 EFFECTIVE DATE AND TERM OF AGREEMENT. 

 
This Agreement is effective and binding on the Company and Employee as of the date hereof; provided, however, that, subject to
Section 2(d), the provisions of Sections 3 and 4 shall become operative only upon the Change in Control Date. 
 

	 2.	  	 EMPLOYMENT OF EMPLOYEE. 

 
(a) Except as provided in Sections 2(b), 2(c) and 2(d), nothing in this Agreement shall affect any right which Employee may otherwise have
to terminate Employee’s employment, nor shall anything in this Agreement affect any right which the Company may have to terminate Employee’s employment at any time in any lawful manner. 

1 “Company” shall include the Company, any successor to the Company’s business and/or assets, and any party which executes and delivers the agreement required by Section 6(e) or which
otherwise becomes bound by the terms and conditions of this Agreement by operation of law or otherwise. 
 

 
(b) In the
event of a Potential Change in Control, to be entitled to receive the benefits provided by this Agreement, Employee will not voluntarily leave the employ of the Company, and will continue to perform Employee’s regular duties and the services
specified in the recitals of this Agreement until the Change in Control Date. Should Employee voluntarily terminate employment prior to the Change in Control Date, this Agreement shall lapse upon such termination and be of no further force or
effect. 
 
(c) If Employee’s employment
terminates on or after the Change in Control Date, the Company will provide to Employee the payments and benefits as provided in Sections 3 and 4. 
 
(d) If Employee’s employment is terminated by the Company prior to the Change in Control Date but on or after a Potential Change in
Control Date, then the Company will provide to Employee the payments and benefits as provided in Sections 3 and 4 unless the Company reasonably demonstrates that Employee’s termination of employment neither (i) was at the request of a third
party who has taken steps reasonably calculated to effect a Change in Control nor (ii) arose in connection with or in anticipation of a Change in Control. Solely for purposes of determining the timing of payments and the provision of benefits in
Sections 3 and 4 under the circumstances described in this Section 2(d), Employee’s date of termination shall be deemed to be the Change in Control Date. 
 

	 3.	  	 TERMINATION FOLLOWING CHANGE IN CONTROL. 

 
(a) If a Change in Control shall have occurred, Employee shall be entitled to the benefits provided in Section 4 upon the subsequent
termination of Employee’s employment within the applicable period set forth in Section 4 unless such termination is due to Employee’s death, Retirement or Disability or is for Cause or is effected by Employee other than for Good Reason (as
such terms are defined in Section 3(d)). 
 
(b) If
following a Change in Control, Employee’s employment is terminated by reason of Employee’s death or Disability, Employee shall be entitled to death or long-term disability benefits from the Company no less favorable than the most favorable
benefits to which Employee would have been entitled had the death or Disability occurred at any time during the period commencing one (1) year prior to the Change in Control. 
 
(c) If Employee’s employment shall be terminated by the Company for Cause or by Employee other than for
Good Reason during the term of this Agreement, the Company shall pay Employee’s Base Salary through the date of termination at the rate in effect at the time notice of termination is given, and the Company shall have no further obligations to
Employee under this Agreement. 
 
(d) For purposes
of this Agreement: 
 
“Base Salary” shall
mean the annual base salary paid to Employee immediately prior to a 

 

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Change in Control, provided that such amount shall in no event be less than the annual base salary paid to Employee during the one (1) year
period immediately prior to the Change in Control. 
 
A “Change in Control” shall be deemed to have occurred if: 
 
(i) Any individual or group constituting a “person”, as such term is used in Sections l3(d) and l4(d)(2) of the Exchange Act (other than (A) the Company or any of its subsidiaries or (B) any
trustee or other fiduciary holding securities under an employee benefit plan of the Company or of any of its subsidiaries), is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing thirty percent (30%) or
more of the combined voting power of the Company’s outstanding securities then entitled ordinarily (and apart from rights accruing under special circumstances) to vote for the election of directors; or 
 
(ii) Continuing Directors cease to constitute at least a
majority of the Board; or 
 
(iii) there occurs a
reorganization, merger, consolidation or other corporate transaction involving the Company (a “Transaction”), in each case with respect to which the stockholders of the Company immediately prior to such Transaction do not, immediately
after the Transaction, own more than 50% of the combined voting power of the Company or other corporation resulting from such Transaction; or 
 
(iv) all or substantially all of the assets of the Company are sold, liquidated or distributed; 
 
provided, however, that a “Change in Control” shall not be
deemed to have occurred under this Agreement if, prior to the occurrence of a specified event that would otherwise constitute a Change in Control hereunder, the disinterested Continuing Directors then in office, by a majority vote thereof, determine
that the occurrence of such specified event shall not be deemed to be a Change in Control with respect to Employee hereunder if the Change in Control results from actions or events in which Employee is a participant in a capacity other than solely
as an officer, employee or director of the Company. 
 
“Change in Control Date” shall mean the date on which a Change in Control occurs. 
 
“Cause” shall mean: 
 
(i) The continued willful failure of Employee to perform Employee’s duties to the Company (other than any such failure resulting from
Employee’s incapacity due to physical or mental illness) after written notice thereof (specifying the particulars thereof in reasonable detail) and a reasonable opportunity to be heard and cure such failure are given to Employee by the Board or
a committee thereof; or 
 
(ii) The willful
commission by Employee of a wrongful act that caused or was 

 

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reasonably likely to cause substantial damage to the Company, or an act of fraud in the performance of Employee’s duties on behalf of
the Company; or 
 
(iii) The conviction of Employee
for commission of a felony in connection with the performance of Employee’s duties on behalf of the Company; or 
 
(iv) The order of a federal or state regulatory authority having jurisdiction over the Company or its operations or by a court of
competent jurisdiction requiring the termination of Employee’s employment by the Company. 
 
“Continuing Directors” shall mean the directors of the Company in office on the date hereof and any successor to any such director who was nominated or selected by a majority of the
Continuing Directors in office at the time of the director’s nomination or selection and who is not an “affiliate” or “associate” (as defined in Regulation 12B under the Exchange Act) of any person who is the beneficial
owner, directly or indirectly, of securities representing ten percent (10%) or more of the combined voting power of the Company’s outstanding securities then entitled ordinarily to vote for the election of directors. 
 
“Disability” shall mean Employee’s incapacity
due to physical or mental illness such that Employee shall have become qualified to receive benefits under the Company’s long-term disability plan as in effect on the date of the Change in Control. 
 
“Dispute” shall mean, in the case of termination of
Employee’s employment for Disability or Cause, that Employee challenges the existence of Disability or Cause, and in the case of termination of Employee’s employment for Good Reason, that the Company challenges the existence of Good Reason
for termination of Employee’s employment. 
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 
“Good Reason” shall mean: 
 
(i) The assignment of Employee to duties which are materially different from Employee’s duties immediately prior to the Change in Control and which result in a material reduction in
Employee’s authority and responsibility when compared to the highest level of authority and responsibility assigned to Employee at any time during the six (6) month period prior to the Change in Control Date; or 
 
(ii) A reduction of Employee’s total compensation as the
same may have been increased from time to time after the Change in Control Date other than (A) a reduction implemented with the consent of Employee or (B) a reduction that is generally comparable (proportionately) to compensation reductions imposed
on senior executives of the Company generally; or 
 
(iii) The failure to provide to Employee the benefits and perquisites, including participation on a comparable basis in the Company’s stock option, incentive, and other similar plans in which employees of the Company of
comparable title and salary grade participate, as 

 

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were provided to Employee immediately prior to a Change in Control, or with a package of benefits and perquisites that are substantially
comparable in all material respects to such benefits and perquisites provided prior to the Change in Control; or 
 
(iv) The relocation of the office of the Company where Employee is employed immediately prior to the Change in Control Date (the “CIC
Location”) to a location which is more than 50 miles away from the CIC Location or the Company’s requiring Employee to be based more than 50 miles away from the CIC Location (except for required travel on the Company’s business to an
extent substantially consistent with Employee’s customary business travel obligations in the ordinary course of business prior to the Change in Control Date); 
 
(v) The failure of the Company to obtain promptly upon any Change in Control the express written assumption
of an agreement to perform this Agreement by any successor as contemplated in Section 6(e); or 
 
(vi) The attempted termination of Employee’s employment for Cause on grounds insufficient to constitute a basis of termination for Cause under this Agreement; or 
 
(vii) The failure of the Company to promptly make any payment
into escrow when so required by Section 3(f). 
 
“Potential Change in Control” shall mean the earliest to occur of (a) the execution of an agreement or letter of intent, the consummation of the transactions described in which would result in a Change in Control, (b) the
approval by the Board of a transaction or series of transactions, the consummation of which would result in a Change in Control, or (c) the public announcement of a tender offer for the Company’s voting stock, the completion of which would
result in a Change in Control; provided, that no such event shall be a “Potential Change in Control” unless (i) in the case of any agreement or letter of intent described in clause (a), the transaction described therein is
subsequently consummated by the Company and the other party or parties to such agreement or letter of intent and thereupon constitutes a “Change in Control”, (ii) in the case of any Board-approved transaction described in clause (b), the
transaction so approved is subsequently consummated and thereupon constitutes a “Change in Control” or (iii) in the case of any tender offer described in clause (c), such tender offer is subsequently completed and such completion thereupon
constitutes a “Change in Control”. 
 
“Potential Change in Control Date” shall mean the date on which a Potential Change in Control occurs. 
 
“Retirement” shall mean Employee’s actual retirement after reaching the normal or early retirement date provided for in the
Company’s Retirement and Profit-Sharing Program as in effect on the date of Employee’s termination of employment. 
 
(e) Any termination of employment by the Company or by Employee shall be communicated by written notice, specify the date of termination,
state the specific basis for termination and set forth in reasonable detail the facts and circumstances of the termination in order to provide a basis for determining the entitlement to any payments under this Agreement. 
 

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(f) If within
thirty (30) days after notice of termination is given, the party to whom the notice was given notifies the other party that a Dispute exists, the parties will promptly pursue resolution of such Dispute with reasonable diligence; provided,
however, that pending resolution of any such Dispute, the Company shall pay 75% of any amounts which would otherwise be due Employee pursuant to Section 4 if such Dispute did not exist into escrow pending resolution of such Dispute and pay 25%
of such amounts to Employee. Employee agrees to return to the Company such amounts to which it is ultimately determined that he is not entitled. 
 

	 4.	  	 PAYMENTS AND BENEFITS UPON TERMINATION. 

 
(a) If within eighteen (18) months after a Change in Control, the Company terminates Employee’s employment other than by reason of
Employee’s death, Disability, Retirement or for Cause, or if Employee terminates Employee’s employment for Good Reason, then the Employee shall be entitled to the following payments and benefits: 
 
(i) The Company shall pay to Employee as compensation for
services rendered, no later than five (5) business days following the date of termination, a lump sum severance payment equal to 2.50 multiplied by the sum of (A) Employee’s Base Salary, (B) the highest annual bonus that was paid to Employee in
any of the three fiscal years ending prior to the date of termination under the Company’s Management Incentive Plan (the “MIP”) or Varian Associates, Inc.’s Management Incentive Plan, and (C) the highest cash bonus for a
performance period of more than one fiscal year that was paid to Employee in any of the three fiscal years ending prior to the date of termination under the MIP. 
 
(ii) The Company shall pay to Employee as compensation for services rendered, no later than five (5) business
days following the date of termination, a lump sum payment equal to a pro rata portion (based on the number of days elapsed during the fiscal year and/or other bonus performance period in which the termination occurs) of Employee’s target bonus
under the MIP for the fiscal year and for any other partially completed bonus performance period in which the termination occurs. 
 
(iii) All waiting periods for the exercise of any stock options granted to Employee and all conditions or restrictions of any restricted
stock granted to Employee shall terminate, and all such options shall be exercisable in full according to their terms, and the restricted stock shall be transferred to Employee as soon as reasonably practicable thereafter. 
 
(iv) Employee’s participation as of the date of
termination in the life, medical/dental/vision and disability insurance plans and financial/tax counseling plan of the Company shall be continued on the same terms (including any cost sharing) as if Employee were an employee of the Company (or
equivalent benefits provided) until the earlier of Employee’s commencement of substantially equivalent full-time employment with a new employer or twenty-four (24) months after the date of termination; provided, however, that after the
date of termination, Employee shall no longer be entitled to receive Company-paid executive physicals or, upon expiration of the applicable memberships, Company-paid airline memberships. In the 

 

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event Employee shall die before the expiration of the period during which the Company is required to continue Employee’s participation
in such insurance plans, the participation of Employee’s surviving spouse and family in the Company’s insurance plans shall continue throughout such period. 
 
(v) Employee may elect upon termination to purchase any automobile then in the possession of Employee and
subject to a lease of which the Company is the lessor by payment to the Company of the residual value set forth in the lease, without any increase for remaining lease payments during the term or other lease breakage costs. Employee may elect to have
any such payment deducted from any payments due the Employee hereunder. 
 
(vi) All payments and benefits provided under this Agreement shall be subject to applicable tax withholding. 
 
(b) Following Employee’s termination of employment for any reason, the Company shall have the unconditional right to reduce any
payments owed to Employee hereunder by the amount of any due and unpaid principal and interest on any loans by the Company to Employee and Employee hereby agrees and consents to such right on the part of the Company. 
 

	 5.	  	 GROSS-UP PAYMENT. 

 
(a) Notwithstanding anything herein to the contrary, if it is determined that any Payment would be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), or any interest or penalties with respect to such excise tax (such excise tax, together with any interest or penalties thereon, is herein referred to as an
“Excise Tax”), then Employee shall be entitled to an additional payment (a “Gross-Up Payment”) in an amount that will place Employee in the same after-tax economic position that Employee would have enjoyed if the Excise Tax had
not applied to the Payment. The amount of the Gross-Up Payment shall be determined by a nationally-recognized independent public accounting firm designated by agreement between Employee and the Company (the “Accounting Firm”). No Gross-Up
Payments shall be payable hereunder if the Accounting Firm determines that the Payments are not subject to an Excise Tax. 
 
“Payment” means (i) any amount due or paid to Employee under this Agreement, (ii) any amount that is due or paid to Employee
under any plan, program or arrangement of the Company and its subsidiaries and (iii) any amount or benefit that is due or payable to Employee under this Agreement or under any plan, program or arrangement of the Company and its subsidiaries not
otherwise covered under clause (i) or (ii) hereof which must reasonably be taken into account under Section 280G of the Code in determining the amount the “parachute payments” received by Employee, including, without limitation, any
amounts which must be taken into account under Section 280G of the Code as a result of (A) the acceleration of the vesting of any option, restricted stock or other equity award, (B) the acceleration of the time at which any payment or benefit is
receivable by Employee or (C) any contingent severance or other amounts that are payable to Employee. 
 

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(b) Subject to
the provisions of Section 5(c), all determinations required under this Section 5, including whether a Gross-Up Payment is required, the amount of the Payments constituting excess parachute payments, and the amount of the Gross-Up Payment, shall be
made by the Accounting Firm, which shall provide detailed supporting calculations both to Employee and the Company within fifteen days of the date reasonably requested by Employee or the Company on which a determination under this Section 5 is
necessary or advisable. The Company shall pay to Employee the initial Gross-Up Payment within 5 days of the receipt by Employee and the Company of the determination of the Accounting Firm. If the Accounting Firm determines that no Excise Tax is
payable by Employee, the Company shall cause its accountants to provide Employee with an opinion that the Accounting Firm has substantial authority under the Code not to report an Excise Tax on Employee’s Federal income tax return. Any
determination by the Accounting Firm shall be binding upon Employee and the Company. If the initial Gross-Up Payment is insufficient to cover the amount of the Excise Tax that is ultimately determined to be owing by Employee with respect to any
Payment (hereinafter an “Underpayment”), the Company, after exhausting its remedies under Section 5(c) below, shall promptly pay to Employee an additional Gross-Up Payment in respect of the Underpayment. 
 
(c) Employee shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment by the Company of a Gross-Up Payment. Such notice shall be given as soon as practicable after Employee knows of such claim and shall apprise the Company of the nature of
the claim and the date on which the claim is requested to be paid. Employee agrees not to pay the claim until the expiration of the thirty (30) day period following the date on which Employee notifies the Company, or such shorter period ending on
the date the Taxes with respect to such claim are due (the “Notice Period”). If the Company notifies Employee in writing prior to the expiration of the Notice Period that it desires to contest the claim, Employee shall: (i) give the
Company information reasonably requested by the Company relating to the claim; (ii) take such action in connection with the claim as the Company may reasonably request, including, without limitation, accepting legal representation with respect to
such claim by an attorney reasonably selected by the Company and reasonably acceptable to Employee; (iii) cooperate with the Company in good faith in contesting the claim; and (iv) permit the Company to participate in any proceedings relating to the
claim. Employee shall permit the Company to control all proceedings related to the claim and, at its option, permit the Company to pursue or forgo any and all administrative appeals, proceedings, hearings, and conferences with the taxing authority
in respect of such claim. If requested by the Company, Employee agrees either to pay the tax claimed and sue for refund or contest the claim in any permissible manner and to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate courts as the Company shall determine; provided, however, that, if the Company directs Employee to pay such claim and pursue a refund, the Company shall advance the
amount of such payment to Employee on an after-tax and interest-free basis (an “Advance”). The Company’s control of the contest related to the claim shall be limited to the issues related to the Gross-Up Payment and Employee shall be
entitled to settle or contest, as the case may be, any other issues raised by the Internal Revenue Service or other taxing authority. If the Company does not notify Employee in writing prior to the end of the Notice Period of its desire to contest
the claim, the Company shall pay to Employee an additional Gross-Up Payment in respect of the excess parachute payments that are 

 

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the subject of the claim, and Employee agrees to pay the amount of the Excise Tax that is the subject of the claim to the applicable taxing
authority in accordance with applicable law. 
 
(d)
If, after receipt by Employee of an Advance, Employee becomes entitled to a refund with respect to the claim to which such Advance relates, Employee shall pay the Company the amount of the refund (together with any interest paid or credited thereon
after Taxes applicable thereto). If, after receipt by Employee of an Advance, a determination is made that Employee shall not be entitled to any refund with respect to the claim and the Company does not promptly notify Employee of its intent to
contest the denial of refund, then the amount of the Advance shall not be required to be repaid by Employee and the amount thereof shall offset the amount of the additional Gross-Up Payment then owing to Employee. 
 
(e) The Company shall indemnify Employee and hold Employee
harmless, on an after-tax basis, from any costs, expenses, penalties, fines, interest or other liabilities (“Losses”) incurred by Employee with respect to the exercise by the Company of any of its rights under this Section 5, including,
without limitation, any Losses related to the Company’s decision to contest a claim or any imputed income to Employee resulting from any Advance or action taken on Employee’s behalf by the Company hereunder. The Company shall pay all legal
fees and expenses incurred under this Section 5, and shall promptly reimburse Employee for the reasonable expenses incurred by Employee in connection with any actions taken by the Company or required to be taken by Employee hereunder. The Company
shall also pay all of the fees and expenses of the Accounting Firm, including, without limitation, the fees and expenses related to the opinion referred to in Section 5(b). 
 

	 6.	  	 GENERAL. 

 
(a) Employee shall retain in confidence under the conditions of the Company’s confidentiality agreement with Employee any proprietary
or other confidential information known to Employee concerning the Company and its business so long as such information is not publicly disclosed and disclosure is not required by an order of any governmental body or court. If required, Employee
shall return to the Company any memoranda, documents or other materials proprietary to the Company. 
 
(b) While employed by the Company and following the termination of such employment (other than a termination of employment by Employee for
Good Reason or by the Company other than for Cause) for a period of two (2) years, Employee shall not, whether for Employee’s own account or for the account of any other individual, partnership, firm, corporation or other business organization,
intentionally solicit, endeavor to entice away from the Company or a subsidiary of the Company (each, a “Protected Party”), or otherwise interfere with the relationship of a Protected Party with, any person who is employed by a Protected
Party or any person or entity who is, or was within the then most recent twelve (12) month period, a customer or client of a Protected Party. 
 
Employee acknowledges that a breach of any of the covenants contained in this Section 6(b) may result in material irreparable injury to
the Company for which there is no adequate remedy at law, that it may not be possible to measure damages for such injuries precisely and 

 

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that, in the event of such a breach, any payments remaining under the terms of this Agreement shall cease and the Company may be entitled to
obtain a temporary restraining order and/or a preliminary or permanent injunction restraining Employee from engaging in activities prohibited by this Section 6(b) or such other relief as may be required to specifically enforce all of the covenants
in this Section 6(b). Employee agrees to and hereby does submit to in personam jurisdiction before each and every such court in the State of California, County of Santa Clara, for that purpose. This Section 6(b) shall survive any termination
of this Agreement. 
 
(c) If litigation is brought
by Employee to enforce or interpret any provision contained in this Agreement, the Company shall indemnify Employee for Employee’s reasonable attorney’s fees and disbursements incurred in such litigation and pay prejudgment interest on any
money judgment obtained by Employee calculated at the prime rate of interest in effect from time to time at the Bank of America, San Francisco, from the date that payment should have been made under the Agreement, provided that Employee shall not
have been found by the court in which such litigation is pending to have had no cause in bringing the action, or to have acted in bad faith, which finding must be final with the time to appeal therefrom having expired and no appeal having been
taken. 
 
(d) Except as provided in Section 4, the
Company’s obligation to pay to Employee the compensation and to make the arrangements provided in this Agreement shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, any setoff,
counterclaim, recoupment, defense or other right which the Company may have against Employee or anyone else. All amounts payable by the Company hereunder shall be paid without notice or demand. Employee shall not be required to mitigate the amount
of any payment provided for in this Agreement by seeking other employment. 
 
(e) The Company shall require any successor, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or substantially all of the business and/or assets of the Company, by
written agreement to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. 
 
(f) This Agreement shall inure to the benefit of and be
enforceable by Employee’s heirs, successors and assigns. If Employee should die while any amounts would still be payable to Employee hereunder if Employee had continued to live, all such amounts shall be paid in accordance with the terms of
this Agreement to Employee’s heirs, successors and assigns. 
 
(g) For the purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail,
return receipt requested, postage prepaid, addressed as follows: 
 

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	  If to Employee:
	  	  If to the Company:

	
	  Martin O’Donoghue
	  	  Varian, Inc.

	  	  	  3120 Hansen Way

	  	  	  Palo Alto, CA 94304-1030

	  	  	  Attn: Vice President, Human Resources

 
or to such other address
as either party furnishes to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt. 
 
(h) This Agreement shall constitute the entire agreement between Employee and the Company concerning the subject matter of this Agreement.

 
(i) The validity, interpretation, construction
and performance of this Agreement shall be governed by the laws of the State of California without giving effect to the provisions, principles or policies thereof relating to choice or conflict of laws. The invalidity or unenforceability of any
provision of this Agreement in any circumstance shall not affect the validity or enforceability of such provision in any other circumstance or the validity or enforceability of any other provision of this Agreement, and, except to the extent such
provision is invalid or unenforceable, this Agreement shall remain in full force and effect. Any provision in this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating or affecting the remaining provisions hereof in such jurisdiction, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. This Section 6(i) shall survive any termination of this Agreement. 
 
(j) This Agreement may be terminated by the Company pursuant to a resolution adopted by the Board at any time prior to a Potential Change
in Control Date. After a Change in Control Date or a Potential Change in Control Date, this Agreement may only be terminated with the consent of Employee. 
 
(k) No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by
either party which are not expressly set forth in this Agreement and this Agreement shall supersede all prior agreements, negotiations, correspondence, undertakings and communications of the parties, oral or written, with respect to the subject
matter hereof. 
 
(l) In the event that the Company
becomes party to a transaction that is intended to qualify for “pooling of interests” accounting treatment and, but for one or more of the provisions of this Agreement would so qualify, then this Agreement shall be interpreted so as to
preserve such accounting treatment, and to the extent that any provision of this Agreement would disqualify the transaction from pooling of interests accounting treatment, then such provision shall be null and void. All determinations to be made in
connection with the preceding sentence shall be made by the independent accounting firm whose opinion with respect to “pooling of 

 

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interests” treatment is required as a condition to the Company’s consummation of such transaction. 
 
IN WITNESS WHEREOF, the parties acknowledge that they have
read and understand the terms of this Agreement and have executed this Agreement to be effective as of December 18, 2002. 
 

	
	  VARIAN, INC.
	     	  EMPLOYEE

	
	              /s/    Arthur
W. Homan

	     	  /s/    Martin
O’Donoghue        

	  By:
	   	  Arthur W. Homan
	     	  Martin O’Donoghue

	  Title:
	   	  Vice President, General Counsel and Secretary
	     	  	  	  

 
 

12Terms of Employment - Walter Alessandrini

 
Exhibit 10.1

 
January 6, 2003 
 
 
TERMS OF EMPLOYMENT 
 
Dear Walter:

 
This letter confirms the terms of your
employment as the President and Chief Executive Officer of Avanex (the “Company”), which employment began on November 18, 2002. The position of President and Chief Executive Officer is a regular, exempt position of considerable
responsibility, integral to our continued business development and success. In this position you will be expected to devote your business time, attention and energies to the performance of your duties with the Company. 
 
The specific terms of your employment are as follows: 
 
Base Salary: Commencing on January 1, 2003, you will be compensated at
a bi-weekly rate of $11,538.46, paid every other Friday, in accordance with the Company’s normal payroll procedures. (This represents an equivalent annual rate of pay of $300,000.00). The first and last payment by the Company to you will be
adjusted, if necessary, to reflect a commencement or termination date other than the first or last working day of a pay period. 
 
Merit Bonus: You will be eligible for a merit-based bonus equal to up to 50% of your base salary upon the achievement of certain milestones to be
determined by the Compensation Committee and approved by the Board of Directors.  
 
Work Location: Your primary place of work will be our offices in Fremont, California. You may be expected to travel for business reasons from time to time as befits your position at the Company. The Company will
reimburse the reasonable costs of such travel in accordance with its standard policies in effect at the time. 
 
Reporting: You will report to the Company’s Board of Directors. 
 

 
Terms of Employment

Page 2 
 
Benefits: As a Company employee, you will be eligible to participate in the employee benefit plans currently and hereafter maintained by the
Company of general applicability to other employees of the Company, as they exist from time to time, including, without limitation, the Company’s group medical, dental, vision, disability, life insurance, and flexible-spending account plans,
subject to the terms of those plans. You will, however, not be eligible to accrue Paid Time Off or be subject to the provisions described in the Company’s Paid Time Off Policy. You may take reasonable vacation and personal time off as long as
your duties and responsibilities are fulfilled to the satisfaction of the Board of Directors The details regarding employee benefit plans will be provided at your orientation meeting with Human Resources. You should note that the Company reserves
the right to cancel or change the benefit plans and programs it offers to its employees at any time and for any reason. 
 
At-Will Employment: You should be aware that your employment with the Company is for no specified period and constitutes “at-will”
employment. This means that your employment relationship with the Company may be terminated at any time with or without notice, with or without good cause or for any or no cause, at either party’s option. You understand and agree that neither
your job performance nor promotions, commendations, bonuses or the like from the Company give rise to or in any way serve as the basis for modification, amendment, or extension, by implication or otherwise, of your at-will employment with the
Company. 
 
Conflict of Interest: You agree that, during the
term of your employment with the Company, you will not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Company is now involved or becomes involved during the term of
your employment, nor will you engage in any other activities that conflict with your obligations to the Company. 
 
In accepting this offer, you are representing to us that (a) you are not a party to any employment agreement or other contract or arrangement which prohibits your employment with the Company, (b) you
do not know of any conflict which would restrict your employment with the Company and (c) you have not and will not bring with you to your employment with the Company any documents, records or other confidential information belonging to former
employers. We ask that, if you have not already done so, you disclose to the Company any and all agreements relating to your prior employment that may affect your eligibility to be employed by the Company or limit the manner in which you may be
employed. 
 

Terms of Employment 
Page 3 
 
Employment, Confidential
Information, and Invention Assignment Agreement: As a condition of your employment with the Company, you must sign and comply with an 
 
Employment, Confidential Information, and Invention Assignment Agreement which requires, among other provisions, the assignment of patent rights to any
invention made during your employment at the Company and non-disclosure of proprietary information. As a Company employee, you will be required to sign an acknowledgment that you have read and understand the Company policies and procedures (as set
forth on the Company’s Outlook “Public Files” system or other similar electronic system that the Company may designate), and you will be expected to abide by all Company policies and procedures. 
 
Arbitration Agreement: As a condition of your employment, you are also
required to sign and comply with an Arbitration Agreement. Among other provisions, the Arbitration Agreement provides that in the event of certain disputes or claims relating to, arising out of or in connection with your employment relationship with
the Company, you and the Company agree that (i) those disputes between you and the Company shall be fully and finally resolved by binding arbitration, (ii) you are waiving any and all rights to have such disputes resolved in court by a judge or
jury; (iii) the arbitrator shall have the power to award any remedies available under applicable law, except attorneys’ fees and costs, which can be awarded to the prevailing party only if authorized by statute or contract, (iv) such disputes
shall be resolved by a neutral arbitrator, and (v) the Company shall pay for any administrative or hearing fees charged by the arbitrator.  
 
This letter, along with the other aforementioned employment-related agreements, set forth the terms of your employment with the Company and supersede in
their entirety any and all prior agreements and understandings concerning your employment relationship with the Company, whether written or oral. The terms of this letter may only be amended, canceled or discharged in writing signed by an authorized
representative of the Company and by you. 
 
Governing Law:
This letter shall be governed by the internal substantive laws, but not the choice of law rules, of the State of California. You hereby agree to exclusive personal jurisdiction and venue in the state and federal courts of the state of California.

 
Severability: In the event that any provision hereof
becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or void, this letter shall continue in full force and effect without such provision. 
 
To indicate your acceptance of the foregoing terms, please sign and date this letter in the space provided below and return
it to Human Resources. A duplicate original is enclosed for your records. 
 

 
Terms of Employment

Page 4 
 
We sincerely feel that Avanex can provide you with the opportunity to achieve rewarding results for both you and the Company, and we look forward to your
contributions. 
 
Sincerely, 
 
Margaret Quinn 
Vice President, Human Resources and Administration 
 
Accepted: /s/ Walter
Alessandrini                                      
                                        
                               Date:
1/9/03

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