Document:

Exhibit
10.25

 

3COM CORPORATION

 

MANAGEMENT RETENTION
AGREEMENT

 

Amended and Restated as of December
16, 2002

 

This Management Retention Agreement (the “Agreement”) is made and
entered into by and between Bruce Claflin (the “Employee”) and 3Com Corporation
(the “Company”), amended and restated effective as of December 16, 2002.

 

R E C I T A L S

 

A.                                   It
is expected that the Company from time to time will consider the possibility of
an acquisition by another company or other change of control, including pursuant
to a reorganization of the Company resulting in the remaining Company being
materially diminished in size.  The
Board of Directors of the Company (the “Board”) recognizes that such
consideration can be a distraction to the Employee and can cause the Employee
to consider alternative employment opportunities.  The Board has determined that it is in the best interests of the
Company and its stockholders to assure that the Company will have the continued
dedication and objectivity of the Employee, notwith­standing the possibility,
threat or occurrence of a Change of Control (as defined below) of the Company.

 

B.                                     The
Board believes that it is in the best interests of the Company and its
stockholders to provide the Employee with an incentive to continue his employment
and to motivate the Employee to maximize the value of the Company upon a Change
of Control for the benefit of its stockholders.

 

C.                                     The
Board believes that it is imperative to provide the Employee with benefits upon
a Change of Control which provides the Employee with enhanced financial
security and provides incentive and encouragement to the Employee to remain
with the Company notwithstanding the possibility of a Change of Control.

 

D.                                    Certain
capitalized terms used in the Agreement are defined in Section 5 below.

 

E.                                      Employee
and the Company are parties to an Employment Agreement dated December 22, 2000
(as in effect from time to time, the “Employment Agreement”).  References in the Employment Agreement to
the “Management Retention Agreement” shall be deemed to refer to the Management
Retention Agreement as in effect from time to time.

 

The parties hereto agree as follows:

 

1.                                       Term
of Agreement.  This Agreement shall
terminate upon the date that all obliga­tions of the parties hereto with
respect to this Agreement have been satisfied.

 

 

2.                                       At-Will
Employment.  The Company and the
Employee acknowledge that the Employee’s employment is and shall continue to be
at-will, as defined under applicable law, and may be terminated by either party
at any time, with or without cause.  If
the Employee’s employment terminates for any reason, including (without
limitation) any termination prior to a Change of Control, the Employee shall
not be entitled to any payments, benefits, damages, awards or compensation other
than as provided by this Agreement, or as may otherwise be available in
accordance with the Company’s established employee plans or pursuant to other
written agree­ments with the Company.

 

3.                                       Change
of Control Benefits.

 

(a)                                  Benefits.  Upon a Change of Control of the Company
occurring while Employee is still employed by the Company, then subject to
Employee entering into a mutual release of claims with the Company in
substantially the form attached hereto as Exhibit A, the Company shall provide
Employee with the following benefits:

 

(i)                                     Lump-Sum
Payment.  A lump-sum cash payment in
an amount equal to two hundred percent (200%) of the Employee’s Annual
Compensation;

 

(ii)                                  Continued
Employee Benefits.  At any time when
Employee’s employment terminates, voluntarily or involuntarily, for any or no
reason, following a Change of Control, the Company shall provide Company-paid
health, dental, vision, long-term disability and life insurance coverage at the
same level of coverage as was provided to such Employee immedi­ately prior to
the termination of employment and at the same ratio of Company premium payment
to Employee premium payment as was in effect immediately prior to the
termination of employment (the “Company-Paid Coverage”).  If such coverage included the Employee’s
dependents immedi­ately prior to the Change of Control, such dependents shall
also be covered at Company expense. 
Company-Paid Coverage shall continue until the earlier of (i) two
years from the date of termination, or (ii) the date upon which the
Employee and his dependents become covered under another employer’s group
health, dental, vision, long-term disability or life insurance plans that
provide Employee and his dependents with comparable benefits and levels of
coverage.  For purposes of Title X of
the Consolidated Budget Reconciliation Act of 1985 (“COBRA”), the date of the
“qualifying event” for Employee and his or her dependents shall be the date
upon which the Company-Paid Coverage commences, and each month of Company-Paid
Coverage provided hereunder shall offset a month of continuation coverage
otherwise due under COBRA.

 

(iii)                               Pro-Rated
Bonus Payment.  A lump-sum cash
payment equal to 100% of such Employee’s target bonus as in effect for the
fiscal year in which the Change of Control occurs, pro-rated by multiplying
such bonus amount by a fraction, the numerator of which shall be the number of
days prior to occurrence of the Change of Control during such fiscal year, and
the denominator of which shall be three-hundred and sixty-five; provided,
however, that if Employee remains with the Company through the end of the
fiscal year in which the Change of Control occurs, then the Company may
subtract the amount previously paid to Employee pursuant to this paragraph from
the annual target bonus amount otherwise payable to Employee on account of such
fiscal year.

 

2

 

(iv)                              Equity
Compensation Accelerated Vesting. 
One Hundred percent (100%) of the unvested portion of any stock option,
restricted stock or other Company equity compensation held by the Employee
shall automatically be accelerated in full so as to become completely vested.

 

(v)                                 Extension
of Stock Option Post-Termination Exercisability.  The post-termination exercise period of any outstanding Company
stock options held by Employee shall be extended to the lesser of (A) one year
from the date of Employee’s termination, or (B) the original option term.

 

(b)                                 Termination
Prior to a Change of Control; Voluntary Termination Without Good Reason or
Involuntary Termination For Cause, Death or Disability Within 3 Months After a
Disposition.  In the event (i) the
Employee’s employment is terminated for any reason prior to a Change of
Control, or (ii) within three months after a Disposition (A) Employee
voluntarily terminates his employment and such termination is not a Voluntary
Termination for Good Reason, (B) Employee is involuntarily terminated for
Cause, or (C) Employee’s employment terminates due to his death or Disability
(as defined herein), then the Employee shall be entitled to receive severance
and any other benefits only as may then be estab­lished under the Company’s
existing severance and benefits plans or pursuant to other written agreements
with the Company.

 

(c)                                  No
Dual Benefits.  In the event that
Employee receives benefits pursuant to Section 3 hereof, he shall not be
entitled to receive severance benefits pursuant to the Employment Agreement.

 

4.                                       Golden
Parachute Excise Tax Full Gross-Up. 
In the event that the benefits provided for in this Agreement or
otherwise payable to the Employee constitute “parachute payments” within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”) and will be subject to the excise tax imposed by Section 4999 of
the Code, then the Employee shall receive (i) a payment from the Company
sufficient to pay such excise tax, plus (ii) an additional payment from
the Company sufficient to pay the excise tax and federal and state income and
employment taxes arising from the payments made by the Company to Employee
pursuant to this sentence.  Unless the
Company and the Executive otherwise agree in writing, the determination of
Executive’s excise tax liability and the amount required to be paid under this
Section 4 shall be made in writing by the Company’s independent auditors
who are primarily used by the Company immedi­ately prior to the Change of
Control (the “Accountants”).  For
purposes of making the calculations required by this Section 4, the
Accountants may make reasonable assumptions and approximations concerning
applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of Sections 280G and 4999 of the Code.  The Company and the Employee shall furnish
to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section.  The Company shall bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Section 4.

 

5.                                       Definition
of Terms.  The following terms
referred to in this Agreement shall have the following meanings:

 

3

 

(a)                                  Annual
Compensation.  “Annual Compensation”
shall mean an amount equal to the sum of (i) the Employee’s Company annual
base salary as in effect immediately preceding the Change of Control, and
(ii) 100% of  the Employee’s Target
Bonus.

 

(b)                                 Target
Bonus.  “Target Bonus” shall mean
Employee’s annual bonus, assum­ing 100% “on target” satisfaction of any
objective or subjective performance milestones.

 

(c)                                  Cause.  “Cause” shall mean (i) an act of
personal dishonesty taken by the Employee in connection with his
responsibilities as an employee and intended to result in substantial personal
enrichment of the Employee, (ii) Employee being convicted of a felony,
(iii) a willful act by the Employee which constitutes gross misconduct and
which is injurious to the Company, (iv) following delivery to the Employee
of a written demand for performance from the Company which describes the basis
for the Company’s reasonable belief that the Employee has not substan­tially
performed his duties, continued violations by the Employee of the Employee’s
obligations to the Company which are demonstrably willful and deliberate on the
Employee’s part.

 

(d)                                 Change
of Control.  “Change of Control”
means the occurrence of any of the following events:

 

(i)                                     Any
Person becomes the “beneficial owner” as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (“Beneficial Owner”), directly or
indirectly, of securities of the Company representing fifty percent (50%) or
more of the total voting power represented by the Company’s then outstanding
voting securities; or

 

(ii)                                  the
consummation of the sale or disposition by the Company of all or substantially
all the Company’s assets; or

 

(iii)                               The
consummation of a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the
voting securi­ties of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation; or

 

(iv)                              A
change in the composition of the Board occurring within a two-year period, as a
result of which fewer than a majority of the directors are Incumbent
Directors.  “Incumbent Directors” shall
mean directors who either (A) are directors of the Company as of the date
upon which this Agreement was entered into, or (B) are elected, or
nominated for election, to the Board with the affirmative votes of at least a
majority of those directors whose election or nomi­nation was not in connection
with any transaction described in subsections (i), (ii), or (iii) above, or in
connection with an actual or threatened proxy contest relating to the election
of directors to the Company; or

 

(v)                                 The
earliest of (i) three (3) months following the closing of a Disposi­tion; (ii)
Employee’s involuntary termination by the Company other than for Cause, death
or

 

4

 

Disability following the closing of a Disposition, or
(iii) Employee’s Voluntary Termination for Good Reason following the closing of
a Disposition.

 

(e)                                  Covered
Business Unit.  “Covered Business
Unit” shall mean the Business Connectivity Company, the Business Networks
Company or CommWorks (or their successor business units).

 

(f)                                    Disability.  “Disability” shall mean that the Employee
has been unable to perform his Company duties as the result of his incapacity
due to physical or mental illness, and such in­ability, at least 26 weeks after
its commencement, is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Employee or the
Employee’s legal representative (such Agreement as to acceptability not to be unreasonably
withheld).  Termina­tion resulting from
Disability may only be effected after at least 30 days’ written notice by the
Company of its inten­tion to terminate the Employ­ee’s employ­ment.  In the event that the Employee resumes the
performance of substantially all of his duties hereunder before the termination
of his employment becomes effective, the notice of intent to terminate shall
automatically be deemed to have been revoked.

 

(g)                                 Disposition.  “Disposition” shall mean that one of the
following shall have occurred with respect to any two of the three Covered
Business Units, either in one or more separate transac­tions:

 

(i)                                     any
Person (other than the Company or its affiliates) becomes the Beneficial Owner,
directly or indirectly, of securities of a Covered Business Unit representing
fifty percent (50%) or more of the total voting power represented by the
Covered Business Unit’s then outstanding voting securities; or

 

(ii)                                  the
consummation of the sale or disposition by the Company of all or substantially
all of a Covered Business Unit’s assets; or

 

(iii)                               the
consummation of a merger or consolidation of a Covered Business Unit with any
other corporation, other than a merger or consolidation which would result in
the voting securi­ties of the Covered Business Unit outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Covered Business Unit or such surviving entity outstanding immediately
after such merger or consolidation; or

 

(iv)                              the
spin-off to the stockholders of the Company, by means of a dividend or exchange
offer, of eighty percent (80%) or more of the voting stock of a Covered
Business Unit; or

 

(v)                                 the
divestiture or liquidation of a Covered Business Unit.

 

(h)                                 Person.  “Person” shall have the same meaning
accorded to such term in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended.

 

5

 

(i)                                     Voluntary
Termination for Good Reason. 
“Voluntary Termination for Good Reason” shall mean the Employee
voluntarily resigns after the occurrence of any of the following:
(i) without the Employee’s express written consent, a material reduc­tion
of the Employee’s duties, title, authority or responsibilities, relative to the
Employee’s duties, title, authority or responsibilities as in effect
immediately prior to such reduction, or the assignment to Employee of such
reduced duties, title, authority or responsibilities; provided, however, that a
reduction in duties, title, author­ity or responsibilities solely by virtue of
the consummation of a Disposition (as, for example, when the Company’s Chief
Executive Officer remains as such following a Disposition) shall not by itself
constitute grounds for a “Voluntary Termination for Good Reason;”
(ii) without the Employee’s express written consent, a material reduction
of the facilities and perquisites (including office space and loca­tion)
available to the Employee immediately prior to such reduc­tion, other than a
reduction generally applicable to all senior management of the Company;
(iii) a reduction by the Company in the base salary of the Employee as in
effect immediately prior to such reduction; (iv) a material reduction by
the Company in the aggregate level of employee benefits, including bonuses, to
which the Employee was entitled immediately prior to such reduction with the
result that the Employee’s aggregate benefits package is materially reduced
(other than a reduction that generally applies to Company employees);
(v) the relocation of the Employee to a facil­ity or a location more than
thirty-five (35) miles from the Employee’s then present location, without the
Employee’s express written consent; or (vi) any act or set of facts or
circumstances which would, under California case law or statute constitute a
constructive termination of the Employee.

 

6.                                       Non-Solicitation.  In consideration for the Change of Control
benefits Employee is to receive herein Employee agrees that he will not, at any
time during the one year following his termi­nation date on or following a
Change of Control, directly or indirectly solicit any individuals to leave the
Company’s (or any of its subsidiaries’) employ for any reason or interfere in
any other manner with the employment relationships at the time existing between
the Company (or any of its subsidi­aries) and its current or prospective
employees.

 

7.                                       Successors.

 

(a)                                  Company’s
Successors.  Any successor to the
Company (whether direct or indirect and whether by purchase, merger,
consolidation, liquidation or otherwise) to all or substan­tially all of the
Company’s business and/or assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement
in the same manner and to the same extent as the Company would be required to
perform such obligations in the absence of a succession.  For all purposes under this Agreement, the
term “Company” shall include any successor to the Company’s business and/or
assets which executes and delivers the assumption agreement described in this
Section 7(a) or which becomes bound by the terms of this Agreement by operation
of law.

 

(b)                                 Employee’s
Successors.  The terms of this
Agreement and all rights of the Employee hereunder shall inure to the benefit
of, and be enforceable by, the Employee’s personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees.

 

6

 

8.                                       Notice.

 

(a)                                  General.  Notices and all other communications contem­plated
by this Agree­ment shall be in writing and shall be deemed to have been duly
given when personally delivered or one day following mailing via Federal
Express or similar overnight courier service. 
In the case of the Employee, mailed notices shall be addressed to him at
the home address which he most recently communicated to the Company in writing.  In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be
directed to the attention of its Secretary.

 

(b)                                 Notice
of Termination.  Any termination by
the Company for Cause or by the Employee pursuant to a Volun­tary Termination
for Good Reason shall be communicated by a notice of termination to the other
party hereto given in accordance with Section 8(a) of this Agreement.  Such notice shall indicate the specific termina­tion
provision in this Agreement relied upon, shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination under
the provision so indicated, and shall specify the termination date (which shall
be not more than 30 days after the giving of such notice).  The failure by the Employee to include in
the notice any fact or circumstance which contributes to a showing of Voluntary
Termination for Good Reason shall not waive any right of the Employee hereunder
or preclude the Employee from asserting such fact or circumstance in enforcing
his rights hereunder.

 

9.                                       Miscellaneous
Provisions.

 

(a)                                  No
Duty to Mitigate.  The Employee
shall not be required to mitigate the value of any benefits contemplated by
this Agreement, nor shall any such benefits be reduced by any earnings or
benefits that the Employee may receive from any other source.

 

(b)                                 Waiver.  No provision of this Agreement shall be
modified, waived or discharged unless the modification, waiver or discharge is
agreed to in writing and signed by the Employee and by two authorized officers
of the Company (other than the Employee). 
No waiver by either party of any breach of, or of compliance with, any
condition or provision of this Agreement by the other party shall be considered
a waiver of any other condition or provision or of the same condition or
provision at another time.

 

(c)                                  Whole
Agreement.  This Agreement, the
Employment Agreement and the agreements specified in Section 8 of the
Employment Agreement (as in effect from time to time) (together, the
“Agreement”) represent the entire agreement and understanding between the
Company and Employee concerning Employee’s employment relationship with the
Company, and supersede and replace any and all prior agreements and
understandings concerning Employee’s employment relationship with the Company,
including the offer letter to Employee dated June 16, 1998.

 

(d)                                 Choice
of Law.  The validity,
interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of California.

 

7

 

(e)                                  Severability.  The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.

 

(f)                                    Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.

 

8

 

IN WITNESS WHEREOF, each of the parties has executed
this Agreement.

 

	
  COMPANY

  	
   

  	
   

  	
  3COM
  CORPORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  ERIC BENHAMOU

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chairman

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  MARK D. MICHAEL

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:  S.V.P., General Counsel & Secretary

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EMPLOYEE

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  BRUCE L. CLAFLIN

  
							

 

9

 

EXHIBIT A

 

MUTUAL RELEASE OF CLAIMS

 

This Mutual Release of Claims (“Release”) is made by and between 3Com
Corporation, Inc. (the “Company”) and
                                                   (“Employee”).

 

RECITALS

 

WHEREAS, the Company and Employee (collectively referred to as “the
Parties”) have agreed that Employee is to receive certain benefits pursuant to
the agreement to which this Release is attached as Exhibit A (the
“Management Retention Agreement”);

 

NOW THEREFORE, in connection with the promises made herein and in the
Management Retention Agreement, the Company and Employee hereby agree as
follows:

 

1.                                       Confidential
Information.  Employee shall
continue to maintain the confidentiality of all confidential and proprietary
information of the Company and shall 
continue to comply with the terms and conditions of the Confidential
Information and Invention Assignment Agreement previously entered into by and
between the Company and Employee.

 

2.                                       Payment
of Salary.  The Company represents
and Employee acknowledges and represents that the Company has paid (or will pay
pursuant to the terms of the applicable plan or program and the Management
Retention Agreement) all salary, wages, bonuses, commissions, accrued vacation
and expense reimbursements and any and all other benefits due to Employee
through the date of signing of this Release.

 

3.                                       Release
of Claims. Employee agrees that the severance benefits provided pursuant to
the Management Retention Agreement represent settlement in full of all
outstanding obligations owed to Employee by the Company or any subsidiary of
the Company.  Employee and the Company,
on behalf of themselves and their respective heirs, agents, representatives,
immediate family members, executors, assigns, directors, employees, attorneys,
investors, shareholders, administrators, affiliates, divisions, subsidi­aries,
parents, predecessor and successor corpora­tions, hereby fully and forever
release each other and their respective heirs, agents, representatives,
immediate family members, executors, assigns, directors, employees, attorneys,
investors, shareholders, administrators, affiliates, divisions, subsidi­aries,
parents, predecessor and successor corpora­tions and agree not to sue or
otherwise institute or cause to be instituted any legal or administrative
proceedings concerning any claim, duty, obligation or cause of action relating
to any matters of any kind, whether presently known or unknown, suspected or
unsuspected, that Employee or the Company may possess against each other from
any omissions, acts or facts that have occurred up until and including the
Effective Date of this Release including, without limitation,

 

(a)                                  any
and all claims relating to or arising from Employee’s relationship with the
Company or any subsidiary of the Company and the termination of that
relationship;

 

 

(b)                                 any
and all claims relating to, or arising from, Employee’s right to purchase, or
actual purchase of shares of stock of the Company or any subsidiary of the
Company, including, without limitation, any claims for fraud,
misrepresentation, breach of fiduciary duty, breach of duty under applicable
state corporate law, and securities fraud under any state or federal law;

 

(c)                                  any
and all claims for wrongful discharge of employment; termination in violation
of public policy; discrimination; breach of contract, both express and implied;
breach of a covenant of good faith and fair dealing, both express and implied;
promissory estoppel; negligent or intentional infliction of emotional distress;
negligent or intentional misrepresentation; negligent or intentional
interference with contract or prospec­tive economic advantage; unfair business
practices; defamation; libel; slander; negligence; personal injury; invasion of
privacy; false imprisonment; and conversion;

 

(d)                                 any
and all claims for violation of any federal, state or municipal stat­ute,
including, but not limited to, Title VII of the Civil Rights Act of 1964,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967,
the Americans with Disabilities Act of 1990, the Fair Labor Standards Act, the
Employee Retirement Income Security Act of 1974, The Worker Adjustment and
Retraining Notification Act, Older Workers Benefit Protection Act; the
California Fair Employment and Housing Act, and the California Labor Code and
all amendments to each such Act as well as the regulations issued thereunder;

 

(e)                                  any
and all claims for violation of the federal, or any state, constitution;

 

(f)                                    any
and all claims arising out of any other laws and regulations relating to
employment or employment discrimination; and

 

(g)                                 any
and all claims for attorneys’ fees and costs.

 

Notwithstanding anything to the contrary in this Section 3, nothing in
this Release is intended to relieve the Company of its obligations under
California Labor Code section 2802 or any other federal or state statute or
common law principle of similar effect, and the release set forth under this
Section 3 does not  extend to any
obligations incurred under such statutes or principles or this Release.  Employee and the Company agree that the
release set forth in this Section 3 shall otherwise be and remain in effect in
all respects as a complete general release as to the matters released.

 

4.                                       Acknowledgment
of Waiver of Claims under ADEA. 
Employee acknowledges that he is waiving and releasing any rights he may
have under the Age Discrimination in Employment Act of 1967 (“ADEA”) and that
this waiver and release is knowing and voluntary.  Employee and the Company agree that this waiver and release does
not apply to any rights or claims that may arise under the ADEA after the
Effective Date of this Release.  Employee
acknowledges that the consid­eration given for this waiver and Release is in
addition to anything of value to which Employee was already entitled.  Employee further acknowledges that he has
been advised by this writing that (a) he should consult with an attorney prior
to executing this Release; (b) he has at least twenty-one (21) days within
which to consider this Release; (c) he has seven (7) days following the
execution of this Release by the Parties to revoke the Release; and (d) this
Release shall not be effective until the revocation period has expired.  Any revocation should be in writing and
delivered to a member of

 

2

 

the Board of Directors by close of business on the
seventh day from the date that Employee signs this Release.

 

5.                                       Civil
Code Section 1542.  Employee and the
Company represent that they are not aware of any claim other than the claims
that are released by this Release. 
Employee and the Company acknowledge that they have been advised by
legal counsel and are familiar with the provisions of California Civil Code
Section 1542, which provides as follows:

 

A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

 

Employee and the Company, being aware of said code section, agree to
expressly waive any rights they may have thereunder, as well as under any other
federal or state statute or common law principles of similar effect.

 

6.                                       No
Pending or Future Lawsuits. 
Employee and the Company represent to each other that they have no
lawsuits, claims, or actions pending in their name, or on behalf of any other
person or entity, against each other or any other person or entity referred to
herein.  Employee and the Company also
represent to each other that as of the Effective Date, they do not have any
basis for, and do not intend to bring any claims on their behalf or on behalf
of any other person or entity against each other or any other person or entity
referred to herein.

 

7.                                       No
Cooperation.  Employee agrees that
he will not counsel or assist any attorneys or their clients in the
presentation or prosecution of any lawsuits, disputes, claims, charges, or
complaints by any third party against the Company (including any subsidiary of
the Company, and/or any officer, director, employee, agent, representative,
shareholder or attorney of the Company or any subsidiary in his, her or its
capacity as such on behalf of the Company or any subsidiary) unless under a
subpoena, court order or otherwise required by law to do so.

 

8.                                       Tax
Consequences.  The Company makes no
representations or warranties with respect to the tax consequences of the
payment of any sums to Employee under the terms of the Management Retention
Agreement and this Release.  Employee
agrees and understands that he is responsible for payment, if any, of local,
state and/or federal taxes on the sums paid thereunder by the Company and any
penalties or assessments thereon.

 

9.                                       Costs.  The Parties shall each bear their own costs,
expert fees, attorneys’ fees and other fees incurred in connection with this
Release.

 

10.                                 Authority.  The Company represents and warrants that the
undersigned has the authority to act on behalf of the Company and to bind the
Company and all who may claim through it to the terms and conditions of this
Release.  Employee represents and
warrants that he has the capacity to act on his own behalf and on behalf of all
who might claim through him to bind them to

 

3

 

the terms and conditions of this Release.  Each Party warrants and represents that
there are no liens or claims of lien or assignments in law or equity or
otherwise of or against any of the claims or causes of action released herein.

 

11.                                 No
Representations.  Each Party
represents that it has had the opportunity to consult with an attorney, and has
carefully read and understands the scope and effect of the provisions of this
Release.  Neither party has relied upon
any representations or statements made by the other party hereto which are not
specifically set forth in this Release.

 

12.                                 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 Release shall continue in full force and effect
without said provision.

 

13.                                 Entire
Agreement.  This Release, the
Management Retention Agreement and the Confidential Information and Invention
Assignment Agreement previously entered into by and between the Company and
Employee represent the entire agreement and understanding between the Company
and Employee concern­ing the subject matter herein, and supersede and replace
any and all prior agreements and understandings.

 

14.                                 No
Oral Modification.  This Release may
only be amended in writing signed by Employee and a duly authorized officer
(other than Employee) of the Company.

 

15.                                 Effective
Date.  This Release is effective
eight days after it has been signed by both Parties (the “Effective Date”).

 

16.                                 Counterparts.  This Release may be executed in counter­parts,
and each counterpart shall have the same force and effect as an original and
shall constitute an effective, binding agree­ment on the part of each of the
undersigned.

 

17.                                 Voluntary
Execution of Release.  This Release
is executed voluntarily and without any duress or undue influence on the part
or behalf of the Parties hereto, with the full intent of releasing all
claims.  The Parties acknowledge that:

 

(a)                                  They
have read this Release;

 

(b)                                 They
have been represented in the preparation, negotiation, and execution of this
Release by legal counsel of their own choice or that they have voluntarily
declined to seek such counsel;

 

(c)                                  They
understand the terms and consequences of this Release and of the releases it
contains;

 

(d)                                 They
are fully aware of the legal and binding effect of this Release.

 

4

 

IN WITNESS WHEREOF, the Parties have executed this Release on the
respective dates set forth below.

 

 

	
   

  	
  3Com Corporation

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE, an individual

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:Exhibit
10.26

 

3COM CORPORATION

 

MANAGEMENT RETENTION
AGREEMENT

 

Amended and Restated as of December
16, 2002

 

This Management
Retention Agreement (the “Agreement”) is made and entered into by and between
Dennis Connors (the “Employee”) and 3Com Corporation (the “Company”), amended
and restated effective as of December 16, 2002.

 

R E C I T A L S

 

A.                                   It
is expected that the Company from time to time will consider the possibility of
an acquisition by another company or other change of control, or a reorganization
of the Company resulting in the remaining Company being materially diminished
in size.  The Board of Directors of the
Company (the “Board”) recognizes that such consideration can be a distraction
to the Employee and can cause the Employee to consider alternative employment
opportunities.  The Board has determined
that it is in the best interests of the Company and its stockholders to assure
that the Company will have the continued dedication and objectivity of the
Employee, notwithstanding the possibility, threat or occurrence of a Change of
Control or Disposition (both as defined below) of the Company.

 

B.                                     The
Board believes that it is in the best interests of the Company and its
stockholders to provide the Employee with an incentive to continue his employment
and to motivate the Employee to maximize the value of the Company upon a Change
of Control or Disposition for the benefit of its stockholders.

 

C.                                     The
Board believes that it is imperative to provide the Employee with severance
benefits upon Employee’s termination of employment following a Change of
Control or Disposition which provides the Employee with enhanced financial
security and provides incentive and encouragement to the Employee to remain
with the Company notwithstanding the possibility of a Change of Control or
Disposition.

 

D.                                    Certain
capitalized terms used in the Agreement are defined in Section 5 below.

 

The parties hereto
agree as follows:

 

1.                                       Term
of Agreement.  This Agreement shall
terminate upon the date that all obligations of the parties hereto with respect
to this Agreement have been satisfied.

 

2.                                       At-Will
Employment.  The Company and the
Employee acknowledge that the Employee’s employment is and shall continue to be
at-will, as defined under applicable law, and

 

1

 

may be terminated by
either party at any time, with or without cause.  If the Employee’s employment terminates for any reason, including
(without limitation) any termination prior to a Change of Control or Disposition,
the Employee shall not be entitled to any payments, benefits, damages, awards
or compensation other than as provided by this Agreement, or as may otherwise
be available in accordance with the Company’s established employee plans or
pursuant to other written agreements with the Company.

 

3.                                       Change
of Control or Disposition Severance Benefits.

 

(a)          Involuntary
Termination other than for Cause, Death or Disability or Voluntary Termination
for Good Reason Following A Change of Control or Disposition.  If, within twelve (12) months following a
Change of Control or Disposition, Employ­ee’s employment is terminated (i)
involuntarily by the Company other than for Cause, death or Disability or (ii)
by the Employee pursuant to a Voluntary Termination for Good Reason, then,
subject to Employee entering into a standard form of mutual release of claims
with the Company in substantially the form attached hereto as Exhibit A, the
Company shall provide Employee with the benefits in subclauses (i) – (v) below
upon such termination.  Notwithstanding
the foregoing, in the event of a Change of Control due to a BU Disposition (as
defined in Section 5(d)(v) below), (A) if the Employee is offered a management
position (with substantially similar compensation and benefits as the position
held by the Employee with the Company at the time of the BU Disposition) with
the business unit or the successor to the business unit subject to the BU
Disposition, then the Employee shall not be entitled to receive the below
benefits, or (B) if the Employee is offered a Section 16 executive officer
position within the Company at substantially similar compensation and other
benefits, then, with respect to such offered position, a Voluntary Termination
for Good Reason shall not have occurred and the Employee shall not be entitled
to receive the below benefits.

 

(i)                                     Lump-Sum
Payment.  A lump-sum cash payment in
an amount equal to one hundred percent (100%) of the Employee’s Annual
Compensation;

 

(ii)                                  Continued
Employee Benefits. The Company shall provide Company-paid health, dental,
vision, long-term disability and life insurance coverage at the same level of
coverage as was provided to such Employee immediately prior to the termination
of employment and at the same ratio of Company premium payment to Employee
premium payment as was in effect immediately prior to the termination of
employment (the “Company-Paid Coverage”). 
If such coverage included the Employee’s dependents immediately prior to
the Change of Control or Disposition, such dependents shall also be covered at
Company expense.  Company-Paid Coverage
shall continue until the earlier of (i) two years from the date of
termination, or (ii) the date upon which the Employee and his dependents
become covered under another employer’s group health, dental, vision, long-term
disability or life insurance plans that provide Employee and his dependents
with comparable benefits and levels of coverage.  For purposes of Title X of the Consolidated Budget Reconciliation
Act of 1985 (“COBRA”), the date of the “qualifying event” for Employee and his
or her dependents shall be the date upon which the Company-Paid Coverage
commences, and each month of Company-Paid Coverage provided hereunder shall
offset a month of continuation coverage otherwise due under COBRA.

 

2

 

(iii)                               Pro-Rated
Bonus Payment.   A lump-sum cash
payment equal to 100% of such Employee’s target bonus as in effect for the
fiscal year in which the Change of Control or Disposition occurs, pro-rated by
multiplying such bonus amount by a fraction, the numerator of which shall be
the number of days prior to occurrence of the Change of Control or Disposition
during such fiscal year, and the denominator of which shall be three-hundred
and sixty-five.

 

(iv)                              Equity
Compensation Accelerated Vesting. 
One hundred percent (100%) of the unvested portion of any stock option,
restricted stock or other Company equity compensation held by the Employee
shall automatically be accelerated in full so as to become completely vested.

 

(v)                                 Extension
of Stock Option Post-Termination Exercisability.  The post-termination exercise period of any outstanding Company
stock options held by Employee shall be extended to the lesser of (A) one year
from the date of Employee’s termination, or (B) the original option term.

 

(b)                                 Voluntary
Resignation; Termination For Cause. 
If the Employee’s employment terminates by reason of the Employee’s
voluntary resignation (and is not a Voluntary Termination for Good Reason), or
if the Employee is terminated for Cause, then the Employee shall not be
entitled to receive severance or other benefits except for those (if any) as
may then be established under the Company’s then existing severance and
benefits plans or pursuant to other written agreements with the Company.

 

(c)                                  Disability;
Death.  If the Employee’s employment
with the Company terminates as a result of the Employee’s Disability, or if
Employee’s employment is terminated due to the death of the Employee, then the
Employee shall not be entitled to receive severance or other benefits except
for those (if any) as may then be established under the Company’s then existing
severance and benefits plans or pursuant to other written agreements with the
Company.

 

(d)                                 Termination
Apart from Change of Control or Disposition.  In the event the Employee’s employment is terminated for any
reason, either prior to the occurrence of a Change of Control or Disposition or
after the twelve (12) month period following a Change of Control or Disposition,
then the Employee shall be entitled to receive severance and any other benefits
only as may then be established under the Company’s existing sever­ance and
benefits plans or pursuant to other written agreements with the Company.

 

4.                                       Golden
Parachute Excise Taxes.

 

(a)                                  Parachute
Payments of Less than 3.59 x Base Amount. In the event that the benefits
provided for in this agreement or otherwise payable to Employee
(a) constitute “parachute payments” within the meaning of Section 280G of
the Internal Revenue Code of 1986, as amended (the “Code”), (b) would be
subject to the excise tax imposed by 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 proposed Treasury Regulations thereunder (or
the final Treasury Regulations, if

 

3

 

they have then been adopted) is less than the product
obtained by multiplying 3.59 by Employee’s “base amount” within the meaning
of  Code Section 280G(b)(3), then such
benefits shall be reduced to the extent necessary (but only to that extent) so
that no portion of such benefits will be subject to excise tax under Section
4999 of the Code.

 

(b)                                 Parachute
Payments Equal to or Greater than 3.59 x Base Amount. In the event that the
benefits provided for in this agreement or otherwise payable to Employee
(a) constitute “parachute payments” within the meaning of Section 280G of
the Code, (b) would be subject to the excise tax imposed by 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 proposed
Treasury Regulations thereunder (or the final Treasury Regulations, if they
have then been adopted) is equal to or greater than the product obtained by
multiplying 3.59 by Employee’s “base amount” within the meaning of  Code Section 280G(b)(3), then the Employee
shall receive (i) a payment from the Company sufficient to pay such excise
tax, plus (ii) an additional payment from the Company sufficient to pay
the excise tax and federal and state income and employment taxes arising from
the payments made by the Company to Employee pursuant to this sentence.

 

(c)                                  280G
Determinations.  Unless the Company
and the Employee otherwise agree in writing, the determination of Employee’s
excise tax liability and the amount required to be paid or reduced under this
Section 4 shall be made in writing by the Company’s independent auditors who
are primarily used by the Company immediately prior to the Change of Control or
Disposition (the “Accountants”).  For
purposes of making the calculations required by this Section 4, the
Accountants may make reasonable assumptions and approximations concerning
applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of Sections 280G and 4999 of the Code.  The Company and the Employee shall furnish
to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section.  The Company shall bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Section 4.

 

5.                                       Definition
of Terms.  The following terms
referred to in this Agreement shall have the following meanings:

 

(a)                                  Annual
Compensation.  “Annual Compensation”
shall mean an amount equal to the sum of (i) the Employee’s Company annual
base salary as in effect immediately preceding the Change of Control or
Disposition, and (ii) 100% of  the
Employee’s Target Bonus.

 

(b)                                 Target
Bonus.  “Target Bonus” shall mean
Employee’s annual bonus, assuming 100% “on target” satisfaction of any
objective or subjective performance milestones.

 

(c)                                  Cause.  “Cause” shall mean (i) an act of
personal dishonesty taken by the Employee in connection with his
responsibilities as an employee and intended to result in substantial personal
enrichment of the Employee, (ii) Employee being convicted of a felony,
(iii) a willful act by the Employee which constitutes gross misconduct and
which is injurious to the Company, (iv) following delivery to the Employee
of a written demand for performance from the Company which describes the basis
for the Company’s reasonable belief that the Employee has not

 

4

 

substantially performed his duties, continued
violations by the Employee of the Employee’s obligations to the Company which
are demonstrably willful and deliberate on the Employee’s part.

 

(d)                                 Change
of Control.  “Change of Control”
means the occurrence of any of the following events:

 

(i)                                     Any
Person becomes the “beneficial owner” (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Company representing fifty
percent (50%) or more of the total voting power represented by the Company’s
then outstanding voting securities; or

 

(ii)                                  The
consummation of the sale or disposition by the Company of all or substantially
all the Company’s assets; or

 

(iii)                               The
consummation of a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation; or

 

(iv)                              A
change in the composition of the Board occurring within a two-year period, as a
result of which fewer than a majority of the directors are Incumbent
Directors.  “Incumbent Directors” shall
mean directors who either (A) are directors of the Company as of the date
upon which this Agreement was entered into, or (B) are elected, or
nominated for election, to the Board with the affirmative votes of at least a
majority of those directors whose election or nomination was not in connection
with any transaction described in subsections (i), (ii), or (iii) above, or in
connection with an actual or threatened proxy contest relating to the election
of directors to the Company; or

 

(v)                                 The
sale or disposition (other than to an affiliate of the Company or pursuant to a
spin-off or similar transaction) including, but not limited to, a sale of
assets or sale of stock, by the Company of all or substantially all of a
Covered Business Unit or comparable business unit for which the Employee
primarily works (a “BU Disposition”).

 

(e)                                  Covered
Business Unit.  “Covered Business
Unit” shall mean the Business Connectivity Company, the Business Networks
Company or CommWorks (or their successor business units).

 

(f)                                    Disability.  “Disability” shall mean that the Employee
has been unable to perform his Company duties as the result of his incapacity
due to physical or mental illness, and such in­ability, at least 26 weeks after
its commencement, is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Employee or the
Employee’s legal representative (such Agreement as to acceptability not to be
unreasonably withheld).  Termina­tion
resulting from Disability may only be effected after at least 30 days’ written
notice by the

 

5

 

Company of its inten­tion to terminate the Employ­ee’s
employ­ment.  In the event that the
Employee resumes the performance of substantially all of his duties hereunder
before the termination of his employment becomes effective, the notice of
intent to terminate shall automatically be deemed to have been revoked.

 

(g)                                 Disposition.  “Disposition” shall mean that one of the
following shall have occurred with respect to any two of the three Covered
Business Units, either in one or more separate transac­tions:

 

(i)                                     any
Person (other than the Company or its affiliates) becomes the Beneficial Owner,
directly or indirectly, of securities of a Covered Business Unit representing
fifty percent (50%) or more of the total voting power represented by the Covered
Business Unit’s then outstanding voting securities; or

 

(ii)                                  the
consummation of the sale or disposition by the Company of all or substantially
all of a Covered Business Unit’s assets; or

 

(iii)                               the
consummation of a merger or consolidation of a Covered Business Unit with any
other corporation, other than a merger or consolidation which would result in
the voting securi­ties of the Covered Business Unit outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Covered Business Unit or such surviving entity outstanding immediately
after such merger or consolidation; or

 

(iv)                              the
spin-off to the stockholders of the Company, by means of a dividend or exchange
offer, of eighty percent (80%) or more of the voting stock of a Covered
Business Unit; or

 

(v)                                 the
divestiture or liquidation of a Covered Business Unit.

 

(h)                                 Person.  “Person” shall have the same meaning
accorded to such term in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended.

 

(i)                                     Voluntary
Termination for Good Reason. 
“Voluntary Termination for Good Reason” shall mean the Employee
voluntarily resigns after the occurrence of any of the following:
(i) without the Employee’s express written consent, a material reduc­tion
of the Employee’s duties, title, authority or responsibilities, relative to the
Employee’s duties, title, authority or responsibilities as in effect
immediately prior to such reduction, or the assignment to Employee of such
reduced duties, title, authority or responsibilities; provided, however, that a
reduction in duties, title, authority or responsibilities solely by virtue of
the consummation of a Change of Control or Disposition (as, for example, when
the Company’s Senior Vice-President of Marketing remains as such following a
Change of Control or Disposition) shall not by itself constitute grounds for a
“Voluntary Termination for Good Reason;” (ii) without the Employee’s
express written consent, a material reduction of the facilities and perquisites
(including office space and location) available to

 

6

 

the Employee immediately prior to such reduc­tion,
other than a reduction generally applicable to all senior management of the
Company; (iii) a reduction by the Company in the base salary of the
Employee as in effect immediately prior to such reduction; (iv) a material
reduction by the Company in the aggregate level of employee benefits, including
bonuses, to which the Employee was entitled immediately prior to such reduction
with the result that the Employee’s aggregate benefits package is materially
reduced (other than a reduction that generally applies to Company employees);
(v) the relocation of the Employee to a facil­ity or a location more than
thirty-five (35) miles from the Employee’s then present location, without the
Employee’s express written consent; or (vi) any act or set of facts or
circumstances which would, under California case law or statute constitute a
constructive termination of the Employee.

 

6.                                       Non-Solicitation.
In consideration for the severance benefits Employee is to receive herein, if
any, Employee agrees that he or she will not, at any time during the one year
following his or her termination date, directly or indirectly solicit any
individuals to leave the Company’s (or any of its subsidiaries’) employ for any
reason or interfere in any other manner with the employment relationships at
the time existing between the Company (or any of its subsidiaries) and its
current or prospective employees.

 

7.                                       Successors.

 

(a)                                  Company’s
Successors.  Any successor to the
Company (whether direct or indirect and whether by purchase, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company’s business and/or assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement
in the same manner and to the same extent as the Company would be required to
perform such obligations in the absence of a succession.  For all purposes under this Agreement, the
term “Company” shall include any successor to the Company’s business and/or
assets which executes and delivers the assumption agreement described in this
Section 7(a) or which becomes bound by the terms of this Agreement by
operation of law.

 

(b)                                 Employee’s
Successors.  The terms of this
Agreement and all rights of the Employee hereunder shall inure to the benefit
of, and be enforceable by, the Employee’s personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees.

 

8.                                       Notice.

 

(a)                                  General.  Notices and all other communications contem­plated
by this Agreement shall be in writing and shall be deemed to have been duly
given when personally delivered or one day following mailing via Federal
Express or similar overnight courier service. 
In the case of the Employee, mailed notices shall be addressed to him at
the home address which he most recently communicated to the Company in
writing.  In the case of the Company,
mailed notices shall be addressed to its corporate headquarters, and all
notices shall be directed to the attention of its Secretary.

 

7

 

(b)                                 Notice
of Termination.  Any termination by
the Company for Cause or by the Employee pursuant to a Volun­tary Termination
for Good Reason shall be communicated by a notice of termination to the other
party hereto given in accordance with Section 8(a) of this Agreement.  Such notice shall indicate the specific
termina­tion provision in this Agreement relied upon, shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination under the provision so indicated, and shall specify the termination
date (which shall be not more than 30 days after the giving of such
notice).  The failure by the Employee to
include in the notice any fact or circumstance which contributes to a showing
of Voluntary Termination for Good Reason shall not waive any right of the
Employee hereunder or preclude the Employee from asserting such fact or
circumstance in enforcing his rights hereunder.

 

9.                                       Miscellaneous
Provisions.

 

(a)                                  No
Duty to Mitigate.  The Employee
shall not be required to mitigate the value of any benefits contemplated by
this Agreement, nor shall any such benefits be reduced by any earnings or
benefits that the Employee may receive from any other source.

 

(b)                                 Waiver.  No provision of this Agreement shall be
modified, waived or discharged unless the modification, waiver or discharge is
agreed to in writing and signed by the Employee and by two authorized officers
of the Company (other than the Employee). 
No waiver by either party of any breach of, or of compliance with, any
condition or provision of this Agreement by the other party shall be considered
a waiver of any other condition or provision or of the same condition or
provision at another time.

 

(c)                                  Whole
Agreement.  No agreements,
representations or understandings (whether oral or written and whether express
or implied) which are not expressly set forth in this Agreement have been made
or entered into by either party with respect to the subject matter hereof.  This Agreement represents the entire
understanding of the parties hereto with respect to the subject matter hereof
and supersedes all prior arrangements and understandings regarding same.

 

(d)                                 Choice
of Law.  The validity,
interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of California.

 

(e)                                  Severability.  The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.

 

(f)                                    Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument.

 

8

 

IN WITNESS WHEREOF, each
of the parties has executed this Agreement, in the case of the Company by its
duly authorized officers.

 

	
  COMPANY

  	
   

  	
   

  	
  3COM
  CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  BRUCE L. CLAFLIN

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:  

  	
  President &
  CEO

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  MARK D. MICHAEL

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title: 

  	
   S.V.P., General Counsel & Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EMPLOYEE

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  DENNIS CONNORS

  
							

 

9

 

EXHIBIT A

 

MUTUAL RELEASE OF CLAIMS

 

This Mutual Release of
Claims (“Release”) is made by and between 3Com Corporation, Inc. (the
“Company”) and
                                                       (“Employee”).

 

RECITALS

 

WHEREAS, the
Company and Employee (collectively referred to as “the Parties”) have agreed
that Employee is to receive certain severance benefits pursuant to the
agreement to which this Release is attached as Exhibit A (the
“Management Retention Agreement”);

 

NOW THEREFORE, in
connection with the promises made herein and in the Management Retention
Agreement, the Company and Employee hereby agree as follows:

 

1.                                       Confidential
Information.  Employee shall
continue to maintain the confidentiality of all confidential and proprietary
information of the Company and shall 
continue to comply with the terms and conditions of the Confidential
Information and Invention Assignment Agreement previously entered into by and
between the Company and Employee.

 

2.                                       Payment
of Salary.  The Company represents
and Employee acknowledges and represents that the Company has paid (or will pay
pursuant to the terms of the applicable plan or program and the Management
Retention Agreement) all salary, wages, bonuses, commissions, accrued vacation
and expense reimbursements and any and all other benefits due to Employee
through the date of signing of this Release.

 

3.                                       Release
of Claims. Employee agrees that the severance benefits provided pursuant to
the Management Retention Agreement represent settlement in full of all
outstanding obligations owed to Employee by the Company or any subsidiary of
the Company.  Employee and the Company,
on behalf of themselves and their respective heirs, agents, representatives,
immediate family members, executors, assigns, directors, employees, attorneys,
investors, shareholders, administrators, affiliates, divisions, subsidiaries,
parents, predecessor and successor corpora­tions, hereby fully and forever
release each other and their respective heirs, agents, representatives,
immediate family members, executors, assigns, directors, employees, attorneys,
investors, shareholders, administrators, affiliates, divisions, subsidiaries,
parents, predecessor and successor corpora­tions and agree not to sue or
otherwise institute or cause to be instituted any legal or administrative
proceedings concerning any claim, duty, obligation or cause of action relating
to any matters of any kind, whether presently known or unknown, suspected or
unsuspected, that Employee or the Company may possess against each other from
any omissions, acts or facts that have occurred up until and including the
Effective Date of this Release including, without limitation,

 

(a)                                  any
and all claims relating to or arising from Employee’s relationship with the
Company or any subsidiary of the Company and the termination of that
relationship;

 

 

(b)                                 any
and all claims relating to, or arising from, Employee’s right to purchase, or
actual purchase of shares of stock of the Company or any subsidiary of the
Company, including, without limitation, any claims for fraud,
misrepresentation, breach of fiduciary duty, breach of duty under applicable
state corporate law, and securities fraud under any state or federal law;

 

(c)                                  any
and all claims for wrongful discharge of employment; termination in violation
of public policy; discrimination; breach of contract, both express and implied;
breach of a covenant of good faith and fair dealing, both express and implied;
promissory estoppel; negligent or intentional infliction of emotional distress;
negligent or intentional misrepresentation; negligent or intentional
interference with contract or prospec­tive economic advantage; unfair business
practices; defamation; libel; slander; negligence; personal injury; invasion of
privacy; false imprisonment; and conversion;

 

(d)                                 any
and all claims for violation of any federal, state or municipal stat­ute,
including, but not limited to, Title VII of the Civil Rights Act of 1964,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967,
the Americans with Disabilities Act of 1990, the Fair Labor Standards Act, the
Employee Retirement Income Security Act of 1974, The Worker Adjustment and
Retraining Notification Act, Older Workers Benefit Protection Act; the
California Fair Employment and Housing Act, and the California Labor Code and
all amendments to each such Act as well as the regulations issued thereunder;

 

(e)                                  any
and all claims for violation of the federal, or any state, constitution;

 

(f)                                    any
and all claims arising out of any other laws and regulations relating to
employment or employment discrimination; and

 

(g)                                 any
and all claims for attorneys’ fees and costs.

 

Notwithstanding
anything to the contrary in this Section 3, nothing in this Release is intended
to relieve the Company of its obligations under California Labor Code section
2802 or any other federal or state statute or common law principle of similar
effect, and the release set forth under this Section 3 does not  extend to any obligations incurred under
such statutes or principles or this Release. 
Employee and the Company agree that the release set forth in this
Section 3 shall otherwise be and remain in effect in all respects as a complete
general release as to the matters released.

 

4.                                       Acknowledgment
of Waiver of Claims under ADEA. 
Employee acknowledges that he is waiving and releasing any rights he may
have under the Age Discrimination in Employment Act of 1967 (“ADEA”) and that
this waiver and release is knowing and voluntary.  Employee and the Company agree that this waiver and release does
not apply to any rights or claims that may arise under the ADEA after the
Effective Date of this Release. 
Employee acknowledges that the consideration given for this waiver and
Release is in addition to anything of value to which Employee was already
entitled.  Employee further acknowledges
that he has been advised by this writing that (a) he should consult with an
attorney prior to executing this Release; (b) he has at least twenty-one
(21) days within which to consider this Release; (c) he has seven (7) days
following the execution of this Release by the Parties to revoke the Release;
and (d) this Release shall not be

 

2

 

effective until the
revocation period has expired.  Any
revocation should be in writing and delivered to a member of the Board of
Directors by close of business on the seventh day from the date that Employee
signs this Release.

 

5.                                       Civil
Code Section 1542.  Employee and the
Company represent that they are not aware of any claim other than the claims
that are released by this Release. 
Employee and the Company acknowledge that they have been advised by
legal counsel and are familiar with the provisions of California Civil Code
Section 1542, which provides as follows:

 

A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

 

Employee and the
Company, being aware of said code section, agree to expressly waive any rights
they may have thereunder, as well as under any other federal or state statute
or common law principles of similar effect.

 

6.                                       No
Pending or Future Lawsuits. 
Employee and the Company represent to each other that they have no
lawsuits, claims, or actions pending in their name, or on behalf of any other
person or entity, against each other or any other person or entity referred to
herein.  Employee and the Company also
represent to each other that as of the Effective Date, they do not have any
basis for, and do not intend to bring any claims on their behalf or on behalf
of any other person or entity against each other or any other person or entity
referred to herein.

 

7.                                       No
Cooperation.  Employee agrees that
he will not counsel or assist any attorneys or their clients in the
presentation or prosecution of any lawsuits, disputes, claims, charges, or
complaints by any third party against the Company (including any subsidiary of
the Company, and/or any officer, director, employee, agent, representative,
shareholder or attorney of the Company or any subsidiary in his, her or its
capacity as such on behalf of the Company or any subsidiary) unless under a
subpoena, court order or otherwise required by law to do so.

 

8.                                       Tax
Consequences.  The Company makes no
representations or warranties with respect to the tax consequences of the
payment of any sums to Employee under the terms of the Management Retention
Agreement and this Release.  Employee
agrees and understands that he is responsible for payment, if any, of local,
state and/or federal taxes on the sums paid thereunder by the Company and any
penalties or assessments thereon.

 

9.                                       Costs.  The Parties shall each bear their own costs,
expert fees, attorneys’ fees and other fees incurred in connection with this
Release.

 

10.                                 Authority.  The Company represents and warrants that the
undersigned has the authority to act on behalf of the Company and to bind the
Company and all who may claim through

 

3

 

it to the terms and
conditions of this Release.  Employee
represents and warrants that he has the capacity to act on his own behalf and
on behalf of all who might claim through him to bind them to the terms and conditions
of this Release.  Each Party warrants
and represents that there are no liens or claims of lien or assignments in law
or equity or otherwise of or against any of the claims or causes of action
released herein.

 

11.                                 No
Representations.  Each Party
represents that it has had the opportunity to consult with an attorney, and has
carefully read and understands the scope and effect of the provisions of this
Release.  Neither party has relied upon
any representations or statements made by the other party hereto which are not
specifically set forth in this Release.

 

12.                                 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 Release shall continue in full force and effect
without said provision.

 

13.                                 Entire
Agreement.  This Release, the
Management Retention Agreement and the Confidential Information and Invention
Assignment Agreement previously entered into by and between the Company and
Employee represent the entire agreement and understanding between the Company
and Employee concern­ing the subject matter herein, and supersede and replace
any and all prior agreements and understandings.

 

14.                                 No
Oral Modification.  This Release may
only be amended in writing signed by Employee and a duly authorized officer
(other than Employee) of the Company.

 

15.                                 Effective
Date.  This Release is effective
eight days after it has been signed by both Parties (the “Effective Date”).

 

16.                                 Counterparts.  This Release may be executed in counter­parts,
and each counterpart shall have the same force and effect as an original and
shall constitute an effective, binding agreement on the part of each of the
undersigned.

 

17.                                 Voluntary
Execution of Release.  This Release
is executed voluntarily and without any duress or undue influence on the part
or behalf of the Parties hereto, with the full intent of releasing all
claims.  The Parties acknowledge that:

 

(a)                                  They
have read this Release;

 

(b)                                 They
have been represented in the preparation, negotiation, and execution of this
Release by legal counsel of their own choice or that they have voluntarily
declined to seek such counsel;

 

(c)                                  They
understand the terms and consequences of this Release and of the releases it
contains;

 

(d)                                 They
are fully aware of the legal and binding effect of this Release.

 

4

 

IN WITNESS WHEREOF, the
Parties have executed this Release on the respective dates set forth below.

 

 

	
   

  	
  3Com Corporation

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE, an
  individual

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

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