Document:

EXHIBIT 10.3

 

SYMPHONY TECHNOLOGY
GROUP, LLC

 

CONSULTING AGREEMENT

 

This
Consulting Agreement (the “Agreement”) is entered into as of May 15,
2006, by and between Symphony Technology Group, LLC (“STG”) a Delaware
limited liability corporation and Lawson Software, Inc., a Delaware corporation
with principal offices located at 380 St. Peter Street, St. Paul, Minnesota,
55102 (“Company”).

 

WHEREAS,
STG possesses certain knowledge and expertise relevant to Intentia
International AB (publ) (“Intentia”); and

 

WHEREA, effective April
24, 2006, Intentia became a majority owned subsidiary of the Company; and

 

WHEREAS, Intentia previously
obtained, and the Company desires to continue to obtain the benefit of STG’s
knowledge and expertise in the form of consulting services performed by STG,
and STG desires to provide such consulting services to the Company related to
Intentia business for the period ending May 31, 2006;

 

NOW, THEREFORE, in
consideration of the foregoing and the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

1.             Consulting Services. During the Term
of this Agreement (defined in Section 3 below), STG, through its employee, J.T.
Treadwell, shall provide advisory services to the Company, its affiliates and
subsidiaries, including, without limitation, Intentia, as specified in Exhibit A
attached to this Agreement and incorporated herein by reference (the “Services”).
It is understood and agreed that Mr. Treadwell shall have no decision-making
authority whatsoever with respect to the Company and that the Services
delivered hereunder shall be limited solely to recommendations and advice to
Company under the supervision of Company’s senior management with respect to
the matters referred to in Exhibit A. It is also understood and agreed
that Romesh Wadhwani will not personally perform any of the Services under this
Agreement. The Company anticipates that the Services will be close to full time
for the first three weeks of the Term, and then will ramp down to about
one-half time for the following few weeks, with the goal of completing most of
the Services by mid-July.

 

2.             Intellectual property rights arising from this
Agreement. All rights of ownership, copyright and other
intellectual property rights arising in any results, discoveries, inventions,
drawings or the like of technical, operational and economical nature, to the
extent developed by STG and/or Mr. Treadwell for Company under this Agreement
alone or together with the Company’s personnel as a part of the performance of
the Services (the “Work Product”) shall vest in the Company. STG may not
employ sub-contractors for the performance of this Agreement without the prior
written approval of Company.

 

3.             Term and Termination. This
Agreement shall be deemed effective for the period commencing on the first date
that Mr. Treadwell began providing Services to Company, May 15, 2006 (the “Effective
Date”), and shall continue for a period of three (3) months ending August
15, 2006 (collectively, the “Term”). Either party may terminate this
Agreement at any time during the Term by delivery of at least thirty (30) days
prior written notice to the other party.

 

4.             Confidentiality.

 

4.1           Confidential
Information; Nondisclosure. The parties acknowledge and agree that in the
course of delivering and receiving the Services hereunder, they may provide
each other with certain nonpublic information, documentation and material relating
to themselves and/or to their respective affiliates or customers, which information
would, by its nature, be understood by a reasonable person to be the

 

1

 

confidential or
proprietary business information of the party disclosing such information (the “Disclosing
Party”) or its affiliates or customers (collectively, the “Confidential Information”). The
party receiving another party’s Confidential Information, including such party’s
employees, affiliates, officers, directors, agents, attorneys, accountants,
auditors and other advisors (collectively, the “Receiving Party”) shall hold such Confidential Information of
the other party in strict confidence in substantially the same manner as it
uses to maintain its own Confidential Information but using no less than a
reasonable standard of care and shall use it solely in connection with
performance of its obligations under this Agreement. Notwithstanding the
foregoing, Company acknowledges and agrees that Mr. Treadwell is authorized to
communicate with members of the Company’s board of directors (“Board Members”)
on an ongoing and regular basis in the course of performance of the Services
hereunder, and that therefore no disclosure of Confidential Information by Mr.
Treadwell to any Board Member, whether individually or simultaneously, shall
constitute a breach of this Agreement. The Company shall have a right of
injunctive relief for any violations of this Section 4.1.

 

4.2           Exclusions. The term “Confidential Information” shall not include
information that:  (i) is or has become
publicly available without restriction through no fault of the Receiving Party;
(ii) is or has been received by the Receiving Party without restriction from a
third party lawfully in possession of such information; (iii) is independently
developed by the Receiving Party without reference to the Disclosing Party’s
Confidential Information; (iv) the Disclosing Party gives the Receiving Party
written authorization to disclose; (v) is or has been disclosed by the
Disclosing Party to a third party without a restriction on disclosure; or (vi)
is required to be disclosed by law or legal processes, provided, however, that
the Receiving Party provides the Disclosing Party with written notice prior to
any such required disclosure.

 

5.             Representations, Warranties, Indemnity and Release.

 

5.1           Representations and Warranties. Company hereby represents and warrants that
it has full right, power and authority to enter into this Agreement and to
obtain the Services from STG, has obtained all necessary, customary and
appropriate approvals in connection herewith, including, but not limited to
obtaining all necessary approvals and/or ratifications from its board of
directors and/or shareholders, as appropriate, and has otherwise complied with,
and shall at all times comply with, all applicable laws, regulations, policies
and procedures in connection herewith.

 

5.2           Indemnity. Company
hereby agrees to indemnify, defend and hold harmless STG, its officers,
partners, managers, employees, consultants and Affiliates, including without
limitation Mr. Treadwell, from and against any and all claims, liabilities,
damages, expenses, fines, penalties and costs of whatsoever nature (including
but not limited to reasonable attorneys’ fees and expenses) arising out of or
related to this Agreement and any continuation, renewal or extension thereof or
any amendment thereto, including but not limited to with respect to the Services
or Work Product, to the maximum extent allowed under law, except that the
foregoing indemnity obligation shall not extend to any claim to the extent
arising out of any fraudulent misrepresentation of STG or Mr. Treadwell. Company
hereby covenants and agrees that it will reimburse STG for, and pay over to
STG, any and all amounts that any indemnified entity hereunder pays or
otherwise becomes liable to pay by reason of providing Services to Company
promptly upon demand by STG for payment. For purposes of this Agreement, the
term “Affiliate” means any entity controlled by, controlling, or under common
control with STG.

 

5.3           Release. Company hereby, (i) releases STG, its personnel and
Affiliates, including without
limitation Mr. Treadwell, from all claims, liabilities, and expenses
relating to or arising out of this Agreement, the Services performed hereunder,
the Work Product and the access to Company Confidential Information by STG or
any other person or entity authorized hereunder, (2) covenants not to sue,
assert or seek to impose any liability on STG, its personnel or Affiliates, including without limitation Mr. Treadwell,
concerning any claim, cause of action or other matter released herein,
and (3) covenants not to assert reliance in any circumstance or manner upon the
Services and/or Work Product provided hereunder. The release and covenant
provisions of this Agreement will apply to the fullest extent of the law,
whether in contract, statute, tort (such as negligence), or otherwise. To
avoidance of doubt, the release and covenant provisions of this Agreement will
not apply, to the extent arising out of
(a) any fraudulent misrepresentation of STG or Mr. Treadwell or (b) any
intentional breach of the confidentiality obligations in Section 4 above.

 

2

 

6.             Expenses. Upon submission of proper
and complete receipts, Company shall reimburse STG for all reasonable expenses
incurred by STG in connection with delivery of the Services, including, but not
limited to, travel and lodging expenses incurred in connection with delivery of
the Services. All payments hereunder shall be invoiced in U.S. dollars and
shall be paid in U.S. dollars within thirty (30) calendar days of STG’s
delivery to Company of each invoice hereunder. The Company and its subsidiaries
shall not be obligated to pay any fees to STG or Mr. Treadwell for any Services
under this Agreement.

 

7.             DISCLAIMER OF WARRANTIES; LIMITATION OF LIABILITY

 

7.1           DISCLAIMER
OF WARRANTIES. EACH PARTY ON BEHALF OF ITSELF AND ITS RESPECTIVE OFFICERS,
EMPLOYEES AND AFFILIATES, INCLUDING WITHOUT LIMITATION MR. TREADWELL, DISCLAIMS
ALL WARRANTIES WITH REGARD TO THE SERVICES, WORK PRODUCT AND ANY OTHER
INFORMATION OR MATERIAL PROVIDED IN CONNECTION HEREWITH, EXPRESS OR IMPLIED,
INCLUDING THE WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT, ERROR-FREE OR
UNINTERRUPTED SERVICE, OR FITNESS FOR A PARTICULAR PURPOSE.

 

7.2           LIMITATION
OF LIABILITY. EXCEPT FOR CLAIMS REQUIRED TO BE INDEMNIFIED UNDER SECTION 5.2
ABOVE, IN NO OTHER EVENT SHALL STG, COMPANY OR ANY OF THE PARTY’S RESPECTIVE
OFFICERS, EMPLOYEES OR AFFILIATES, INCLUDING WITHOUT LIMITATION MR. TREADWELL, BE
LIABLE FOR ANY SPECIAL, PUNITIVE, INDIRECT OR CONSEQUENTIAL, INCIDENTAL,
DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS OF DATA, LOSS OF BUSINESS OR OTHER
LOSS (INCLUDING SUBSTITUTION OF SERVICES) ARISING OUT OF OR RELATING TO THIS
AGREEMENT EVEN IF PREVIOUSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND
REGARDLESS OF ITS NEGLIGENCE OR OTHER FAULT AND REGARDLESS OF WHETHER SUCH
LIABILITY SOUNDS IN CONTRACT, NEGLIGENCE, TORT, STRICT LIABILITY OR ANY OTHER
THEORY OF LEGAL LIABILITY. EXCEPT FOR CLAIMS REQUIRED TO BE INDEMNIFIED UNDER
SECTION 5.2 ABOVE, IN NO OTHER EVENT SHALL STG’S, COMPANY’S, ITS OFFICERS’,
EMPLOYEES’ OR ITS AFFILIATES’ (INCLUDING WITHOUT LIMITATION MR. TREADWELL’S) CUMULATIVE
LIABILTY HEREUNDER EXCEED THE AMOUNT PAID OR PAYABLE BY COMPANY TO STG FOR WORK
PERFORMED HEREUNDER IN THE TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE
CAUSE OF ACTION GIVING RISE TO ANY SUCH CLAIM.

 

8.             Miscellaneous.

 

8.1           Binding
Effect and Assignment. This Agreement shall be binding upon the parties
hereto, and their successors and assigns. Neither party may assign this
Agreement, its obligations hereunder to any third party, without the prior
written consent of the other party, which consent shall not be unreasonably
withheld, conditioned or delayed, and any assignment, delegation or subcontract
in violation of this provision shall be void and of no effect.

 

8.2           Independent
Contractors. The relationship between STG and Company is solely that of
independent contractors and not that of an agency, partnership, joint venture
or employment relationship, and nothing herein shall be deemed to authorize
either party to act for, represent or bind the other. All individuals who
provide Services to Company hereunder shall be employees, consultants or
subcontractors of STG, and none shall be considered employees of Company. STG
shall be responsible for payment of all withholding taxes, all other payroll
deductions and social insurance obligations with respect to such individuals.
Company shall not be responsible for the payment of workers’ compensation
insurance, disability benefits or any fringe benefits provided to Mr. Treadwell.

 

 8.3          Entire
Agreement; Section Headings; Counterparts; Facsimile. This Agreement, together
with Exhibit A hereto, constitutes the entire agreement between STG and Company
with respect to the transactions contemplated herein and the subject matter
hereof, and it supersedes and replaces all prior oral

 

3

 

or written agreements,
commitments or understandings with respect to the transactions contemplated
herein and the subject matter hereof. No amendment, modification or discharge
of this Agreement shall be valid or binding, unless set forth in writing and
duly executed and delivered by an authorized representative of both Company and
STG. The section headings contained in this Agreement are inserted for
convenience of reference only, shall not be deemed to be a part of this
Agreement for any purpose, and shall not in any way define or affect the
meaning, construction or scope of any of the provisions of this Agreement. To
facilitate execution, this Agreement may be executed in as many counterparts as
may be required, and all counterparts shall collectively constitute a single
Agreement. This Agreement may be delivered by facsimile.

 

8.4           Notices.
Any notice or other communication required or permitted under this Agreement
shall be given in writing to the other party via hand delivery, or certified
mail return receipt requested, or by internationally recognized overnight
delivery service. The parties by notice may designate another address or
individual to which a required notice may be directed. Notices shall be
effective upon receipt. Each notice sent or mailed in the manner described
above shall be deemed provided for all purposes at such time as it is delivered
to the addressee (with the return receipt or the delivery receipt being deemed
conclusive, but not exclusive, evidence of such delivery) or at such time as
delivery is refused by the addressee upon presentation.

 

	
  If to Company, to:

  	
   

  	
  And if to STG:

  
	
   

  	
   

  	
   

  
	
  Lawson Software, Inc.

  	
   

  	
  Symphony Technology
  Group

  
	
  380 St.
  Peter Street

  	
   

  	
  4015 Miranda Avenue, 2nd Floor

  
	
  St.
  Paul, Minnesota 55102

  	
   

  	
  Palo Alto, CA 84304, USA

  
	
  USA

  	
   

  	
  Attn: William Chisholm

  
	
  Attn: General Counsel

  	
   

  	
   

  
	
   

  	
   

  	
  With simultaneous copy
  to: Legal Dept.

  

 

8.5           Severability.
If any provision or provisions of this Agreement shall be held by a court of
competent jurisdiction to be contrary to law, or for any reason invalid,
unenforceable, void or voidable, such provision or provisions shall be deemed
to be null and void and the remainder of this Agreement shall, to the extent
practicable, remain in full force and effect. To the extent a provision of this
Agreement is in invalid, unenforceable, void or voidable, the parties agree to
negotiate in good faith to amend such to conform as nearly as possible, in
accordance with applicable law, to the intended purpose and intent of the
original provision.

 

8.6           Waiver.
No delay or failure on the part of either party hereto in exercising any right,
power or privilege under this Agreement shall impair any such right, power or
privilege or be construed as a waiver or any acquiescence thereto; nor shall
any single or partial exercise of any right, power, or privilege preclude any
other or further exercise thereof or the exercise of any other right, power, or
privilege. No waiver shall be valid against either party, unless made in
writing and signed by the party against whom enforcement of such waiver is
sought, and then only to the extent expressly specified therein.

 

8.7           Governing
Law. This Agreement shall be governed by substantive California law. Nothing
in this Agreement affects any statutory rights that cannot be waived or limited
by contract under applicable law.

 

8.8           Dispute
Resolution. All controversies, claims or disputes arising out of or
relating to this Agreement and/or the Services performed hereunder not
otherwise informally resolved by the parties will be subject to binding arbitration
by either party in accordance with the arbitration rules of the American Arbitration
Association. The arbitration proceedings shall take place in Palo Alto,
California. The arbitration panel shall consist of three arbitrators having
significant relevant industry experience shall be selected as follows:  one arbitrator by each of the parties and the
third by the two arbitrators so selected or, if such arbitrators cannot agree,
by the American Arbitration Association in accordance with the Rules and all
proceedings and filings shall be in English. The parties agree that the
arbitrators will have the power to decide any motions brought by any party to
the arbitration and that arbitration will be the sole, exclusive

 

4

 

and final remedy
for any dispute between STG and Company, and accordingly except as provided by
the above-reference rules neither party will be permitted to pursue court
action regarding claims that are subject to arbitration and thereby waive any
right to trial by jury.

 

8.9           Survival.
Unless otherwise expressly provided in this Agreement, termination of this
Agreement shall not relieve either party from any obligation it has to make any
payments to the other party as required under this Agreement. Sections 2, 4, 5,
7 and 8 of this Agreement shall survive termination of this Agreement for any
reason and remain in full force and effect.

 

8.10         Advice
of Counsel. EACH PARTY ACKNOWLEDGES THAT, IN EXECUTING THIS AGREEMENT, SUCH
PARTY HAS HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL,
AND HAS READ AND UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS
AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR
PREPARATION HEREOF.

 

 

ACCEPTED and AGREED as of the Effective Date:

 

	
  SYMPHONY
  TECHNOLOGY GROUP, LLC

  	
  LAWSON
  SOFTWARE, INC.

  
	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
  Bruce B.
  McPheeters

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
  Senior Vice President, Secretary
  &

  	
   

  
	
   

  	
   

  	
  General Counsel

  	
   

  
													

 

5

 

EXHIBIT A

 

SERVICES

 

 The Services
under this Agreement consist of work by Mr. Treadwell to provide the Company
project management and related services pertaining to the conversion of
Intentia’s financial information to U.S. GAAP, provided, however, that the
Company acknowledges and agrees that STG is not an accounting firm nor does it
hold itself out as such, that Mr. Treadwell is not an accountant, that his work
is of a consulting nature only, and that his work shall be submitted to and
reviewed and/or modified by the auditors and accountants expressly designated
by the Company’s Board of Directors for such purpose.

 

6Exhibit 10.3

 

[***] Certain information on this page has been omitted and filed
separately with the Securities and Exchange Commission. Confidential treatment
has been requested with respect to the omitted portions.

 

Ikanos
Communications, Inc.

2006 Sales Compensation Plan

For Vice President Worldwide Sales

 

Version 2.6

 

1.             Purpose

 

1.1.          Attraction,
retention and motivation. The goal of this plan is to attract, retain, and
motivate the best salespeople in the industry through clearly specified sales
goals and a pay-for-performance philosophy.

 

1.1.1.       Attraction.
Earn higher than the industry norm through the no-cap quarterly revenue-based and
margin-based commission and the no-cap annual revenue-based and margin-based commission
with multiplier.

 

1.1.2.       Retention.
Participants are rewarded with an Annual Commission paid after year end results
are final.

 

1.1.3.       Motivation.
OEM Design Win Incentives and Strategic Telco Win Incentives

 

1.2.          Communicate
the company goals. Another goal of the Plan is to communicate what the
company wants you to focus on:

 

1.2.1.       Exceeding
quarterly revenue targets

 

1.2.2.       Exceeding
quarterly margin targets

 

1.2.3.       Winning
strategic Telco tenders

 

1.2.4.       Winning
OEM designs and launching new products

 

1.2.5.       Teamwork
to meet above goals

 

1.3.          Pay
for performance. The company believes in pay for performance and rewards
sales performance with a no-cap revenue-based commission plan.

 

2.             Overview

 

The Ikanos 2006 Sales Compensation Plan is
composed of:

 

2.1.          Salary

 

2.2.          Performance
Pay

 

2.2.1.       Commission
based on meeting Quarterly Target Revenue and Target Margin Goals

 

2.2.2.       Annual
Commission based on exceeding Annual Target Revenue and Target Margin Goals

 

2.2.3.       Incentives
to win OEM designs and launch new products

 

2.2.4.       Incentives
to win strategic Telco tenders

 

2.3.          Stock
Options

 

2.4.          Benefits

 

2.5.          Car
Allowance

 

3.             Definitions

 

3.1.          Performance
Pay – Variable compensation calculated based on performance to goals and typically
paid on a quarterly and annual basis.

 

 

3.2.          FAE
– Field Applications Engineers

 

3.3.          Salary
– Compensation usually referred to as “Base Salary” paid on a regular basis.

 

3.4.          Commission
– Compensation that varies as a function of performance against assigned tasks
or goals.

 

3.5.          Benefits
– A form of compensation allocated to or for the purchase of employee benefits
such as company health care plan/s. In some cases, the employee may pay some
portion of the cost of these benefits

 

3.6.          Target
Customers – OEM’s, Distributors or Contract Manufacturers that purchase products
or services from Ikanos.

 

3.7.          Target
OEM Design Wins – Ikanos chipsets that have fulfilled a system vendor’s
specifications and have been designed into a specific end product.

 

3.8.          Target
Commission – Variable compensation amount limited to a specific time period.

 

3.9.          Quarterly
Target Revenue Goal – Quarterly revenue target toward which the effort of an
employee is directed.

 

3.10.        Annual
Target Revenue Goal - Fiscal year revenue target toward which the effort of an
employee is directed.

 

3.11.        Quarterly
Target Margin Quota - Quarterly margin target toward which the effort of an
employee is directed.

 

3.12.        Annual
Target Margin Quota - Fiscal year margin target toward which the effort of an
employee is directed

 

3.13.        Actual
Revenue – [***]

 

3.14.        Actual
Margin – Gross margin that has been reported by the company following any
necessary review or audit by the Company’s independent CPA’s.

 

3.15.        Teamwork
– Work and activities of a group of employees who individually contribute to
the productivity of the whole.

 

3.16.        Sales
Teams – A group of employees associated together in work or activities.

 

3.17.        Shared
Quota – a quota that is shared amongst two or more sales people.

 

3.18.        OEM
– Original Equipment Manufacturer that typically sells and supports equipment
to Telco’s.

 

4.             Eligibility

 

4.1.          Sales
managers, sales directors, sales operations managers and sales vice presidents
are eligible for commissions and incentives under this Plan while employed by
the Company.

 

4.2.          FAE’s
are eligible for incentives under this Plan while employed by the Company.

 

5.             Deadlines

 

5.1.          The
following Table 1 determines the deadlines involved in the calculation and
payment of your commissions and incentives.

 

5.2.          Adjustments
to your Plan Summary for Shared Quotas, OEM Design Win Targets, and Strategic
Telco Wins may be approved prior to the beginning of each quarter on the dates
below by the CEO.

 

5.3.          In
the event that OEM Design Win Claim Forms or Strategic Telco Win Claim Forms
are not submitted by the Plan participant before the deadline then the OEM
Design Win and/or the Strategic Telco Win shall not be paid for the current
quarter.

 

2

 

5.4.          Provided
that the Plan participants submit their Claim Forms, in the event of a delay in
disbursement of payment, you will be eligible for a recoverable draw for the amount
of 50% of your performance pay for that quarter.

 

Table 1. Deadlines

 

	
  Deadlines 2006

  	
   

  	
  Q1

  	
   

  	
  Q2

  	
   

  	
  Q3

  	
   

  	
  Q4

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sales -
  Adjustments to your Plan Summary for the following quarter

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sales –
  Last day to ship Products

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sales -
  OEM Design Win and Strategic Telco Win Claim Forms submitted from Sales to
  Finance

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Finance
  - Complete Review of Claims when submitted

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HR,
  Finance – PANs Completed

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HR – CEO
  signed off

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Payroll -
  Payments Disbursed

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  

 

6.             Salary

 

6.1.          The
Company will pay you a regular fixed salary paid in 26 (US employees) or 12
(international office employees) pay periods based on your Plan Summary.

 

7.             Commission on Revenue

 

7.1.          Target
Revenue. The Annual Operating Plan as published to the Ikanos Board of
Directors sets your Target Quarterly Revenue and your Target Annual Revenue at
the time the 2006 Sales Plan is approved. In the event that the Annual
Operating Plan revenue is increased your Plan Summary revenue target shall not
be increased. In the event that the Annual Operating Plan revenue is decreased,
you may be eligible for a change to your Plan Summary if approved by the Vice
President of Worldwide Sale and the CEO. The Plan Summary lists your Target
Quarterly Revenue and Target Annual Revenue. A copy of the Annual Operating
Plan is attached.

 

7.2.          Target
Commission. Your Plan Summary lists the dollar amounts of your Target
Quarterly Commission and your Target Annual Commission.

 

7.3.          Calculation
of Quarterly Revenue Commission. Quarterly Revenue Commission shall be calculated
as follows unless otherwise limited in your Plan Summary:

 

Quarterly Revenue Commission = (Actual
Quarterly Revenue/Target Quarterly Revenue)*Target Quarterly Revenue Commission

 

3

 

7.4.          Calculation
of Annual Revenue Commission. If your Actual Annual Revenue is over 100% of
your Target Annual Revenue, then you are eligible for the Annual Revenue
Commission. Annual Revenue Commission shall be calculated as follows:

 

Annual Revenue Commission = 2*((Actual Annual
Revenue/Target Annual Revenue)-1)*Target Annual Revenue Commission

 

7.5.          No
Cap on Commissions. Quarterly and Annual Commission on Revenue shall not be
capped.

 

8.             Commission on Margin

 

8.1.          Target
Margin. The Annual Operating Plan as published to the Ikanos Board of
Directors sets your Target Quarterly Margin and your Target Annual Margin at
the time the 2006 Sales Plan is approved. In the event that the Annual
Operating Plan revenue is increased your Plan Summary revenue target shall not
be increased. In the event that the Annual Operating Plan revenue is decreased,
you may be eligible for a change to your Plan Summary if approved by the Vice
President of Worldwide Sales and the CEO. The Plan Summary lists your Target
Quarterly Margin and Target Annual Margin

 

8.2.          Target
Margin Commission. Your Plan Summary lists the dollar amounts of your
Target Quarterly Margin Commission and your Target Annual Margin Commission.

 

8.3.          Calculation
of Quarterly Margin Commission. Quarterly Margin Commission shall be
calculated as follows:

 

Quarterly Margin Commission = (Actual
Quarterly Margin/Target Quarterly Margin)*Target Quarterly Margin Commission

 

8.4.          Calculation
of Annual Margin Commission. If your Actual Annual Margin is over 100% of
your Target Annual Margin, then you are eligible for the Annual Margin
Commission. Annual Margin Commission shall be calculated as follows:

 

Annual Margin Commission = 2*((Actual Annual
Margin/Target Annual Margin)-1)*Target Annual Margin Commission

 

8.5.          No
Cap on Commissions. Quarterly and Annual Commission on Revenue shall not be
capped.

 

9.             OEM Design Win Incentives

 

9.1.          Target
OEM Design Wins. If you believe you have earned an OEM Design Win Incentive
from one of your listed OEM Design Wins (listed in your Plan Summary), [***] AND,
depending on the region, shipments of at least [***] CO ports for Asia and
EU and [***] CO ports for North America or a minimum of [***] CPE ports regardless
of which region. Shipments must occur before the date of your claim. Lastly an
OEM Design Win Claim Form must be submitted prior to the dates specified in
Table 1 above.

 

9.2.          Target
OEM Design Win Incentive Amount. Your Plan Summary lists the dollar amount
of your OEM Design Win Incentive.

 

9.3.          Qualifying
OEM Design Wins. To qualify for an OEM Design Win Incentive, the OEM
customer and product must be listed on your Plan Summary before the beginning
of each quarter. Each OEM Design Win shall be assigned a weighting factor
measured in points and listed in your Plan Summary. Points shall be assigned in
reference to revenue and margin opportunity or by strategic significance.

 

9.4.          Claiming
OEM Design Win Incentive. If you believe you have earned an OEM Design Win
Incentive from one of your listed OEM Design Wins (listed in your Plan
Summary), then you must complete and submit as OEM Design Win Claim Form to the
VP of WW Sales AND shipments of at least [***] CO ports or at least [***] CPE
ports to a Target 

 

4

 

OEM Customer must occur before the date of your claim. Lastly an OEM
Design Win Claim Form must be submitted prior to the dates specified in Table 1
above.

 

9.5.          Late
Claim Forms. If you fail to submit your Claim Form on the dates specified
in Table 1 above, then your claim will not be included in that quarter’s
compensation. You may submit a new claim form in the following fiscal quarter
under this Plan. If you fail to submit your claim form in the fourth fiscal
quarter of this year, then your claim will not be included in this year’s
compensation calculations.

 

9.6.          Calculation
of OEM Design Win Incentive. OEM Design Win Incentives shall be calculated
as dollars per point times the Target OEM Design Win points. The dollars per
point and points per Target OEM Customer are listed in your Plan Summary.

 

9.7.          OEM
Design Win Not Achieved in the Quarter Specified. In the event that an OEM
Design Win is not achieved in the quarter specified in your plan summary, the
OEM Design Win rolls into the following quarter, except for Q4.

 

10.          Strategic Telco Win Incentive

 

10.1.        Target
Strategic Telco Customers. Your Plan Summary lists your Target Strategic
Telco Customers eligible for Strategic Telco Win Incentives. You may request to
have new Strategic Telco Win opportunities to be added to your list of targets
by submitting an amended Plan Summary to your immediate supervisor and the VP
of Sales for signature approval. If you have not obtained the appropriate signatures
on the amended Plan Summary by the end of the fiscal quarter for the following
quarter, your new Strategic Telco Win opportunities will not be included in
your compensation for the following quarter.

 

10.2.        Strategic
Telco Win Incentive Amount. Your Plan Summary also states the dollar amount
of your Strategic Telco Win Incentive.

 

10.3.        Qualifying
Strategic Telco Wins. To qualify for this Incentive, the Telco customer
must be listed on your Plan Summary before the beginning of each quarter. You
may request to have new Target Strategic Telco Win opportunities to be added to
your list of targets for the following quarter by submitting an amended Plan
Summary to your immediate supervisor and the VP of Worldwide Sales for
signature approval. If you have not obtained the required signatures on the
amended Plan Summary by the dates set in the Table 1 above in the appropriate
quarter, your requested new Target Strategic Telco Wins will NOT be included in
your compensation for the following quarter.

 

10.4.        Claiming
Strategic Telco Wins. If you believe you have earned a Strategic Telco Win
from one of your Strategic Telcos (as listed in your Plan Summary) then
complete and submit a Strategic Telco Win Claim Form to the VP of WW Sales
along with evidence which shall include, but is not limited to, any of the
following forms:

 

	
  •

  	
  Telco or OEM press release or Ikanos joint press release stating
  Ikanos has been selected by the Telco or OEM for the Telco deployment;

  
	
   

  	
   

  
	
  •

  	
  Official written communication from Telco or OEM to Ikanos stating
  that Ikanos has been selected by the Telco or OEM for the Telco deployment;

  
	
   

  	
   

  
	
  •

  	
  Official meeting minutes sent to all attendees of a CEO-to-CEO or
  CEO-to-GM meeting at either Telco or OEM where the customer CEO or GM
  officially states that Ikanos has been selected for the Strategic Telco
  deployment;

  
	
   

  	
   

  
	
  •

  	
  Official meeting minutes sent to all attendees of a VP-to-VP or
  VP-to-GM meeting at either Telco or OEM where the customer VP or GM
  officially states that Ikanos has been selected for the Strategic Telco
  deployment; or

  

 

5

 

	
  •

  	
  Written certification by Ikanos VP of Sales and CEO stating that the
  Strategic Telco has been won.

  

 

10.5.        Awarding
Strategic Telco Wins. Strategic Telco Win Incentives shall be awarded upon
claim forms signed by the Vice President of Human Resources and the CEO. Each
Strategic Telco Win may only be claimed once.

 

11.           Payment Process

 

11.1.        Operations
Sales Manager will provide to finance analyst and assistant controller a
summary commission worksheet signed by the VP of WW sales. This summary sheet
will list, by eligible sales personnel, the actual revenue by customer, quota,
percentage achieved, quarterly revenue commission payment, total design win
points, OEM design win incentive payment, and strategic telco incentive
payment.

 

11.2.        Finance
analyst and assistant controller will sign off on the summary commission
worksheet, after validating summaries from detail reports. After signing off,
finance analyst and assistant controller will obtain CFO and CEO signatures on
the summary commission worksheet.

 

11.3.        After
the summary commission worksheet has been signed, HR will complete requisite
personnel action notices (PANs) and attach originals of signed summary
worksheet. VP of HR will sign off on PANs and PANs and summaries will be
submitted to Finance for payment.

 

12.          Stock Options

 

12.1.        All
FAE’s, sales managers, sales directors, sales operations managers, and sales
vice presidents eligible under this Plan qualify for Stock Options at the date
of hire and also are eligible for consideration for additional stock options
based on their performance during the annual option grant process.

 

13.          Spot Bonus

 

13.1.        All
FAE’s, sales managers, sales directors and sales vice presidents are eligible
for spot bonuses in accordance with the Company’s bonus policy and practices.

 

14.          First quarter of employment guarantee

 

14.1.        From
your employment start date with the Company or any of its subsidiaries to end
of your first full fiscal quarter, your Performance Pay as defined in your Plan
Summary shall be paid at 100% (pro-rated for the numbers of calendar days you
were employed in that quarter).

 

15.          Other Duties

 

15.1.        From
time to time you may be assigned to perform other duties. These might include,
but are not limited to, such tasks as collecting market research data,
arranging press tours, participating in technical standards meetings, language
translation, and setting up trade show booths. Such duties are a normal part of
your job for which the company pays you a salary. Other duties may be assigned
by your supervisor.

 

16.          Employee Benefits

 

16.1.        You
will be eligible to participate in the company employee benefits programs - See
HR.

 

17.          Termination of Employment

 

17.1.        If
your employment is terminated (voluntary or involuntary), you will be eligible
for a pro-rated % of your target performance pay calculated as follows:

 

6

 

17.1.1.     (Days
worked in the quarter / Days in the quarter) * your Earned Quarterly Revenue
Commission. (Days are calendar days)

 

17.1.2.     No
payment for Annual Revenue Commission.

 

17.1.3.     OEM
Design Win Incentive Claim Forms and the evidence of the win must be submitted
before your last day of employment for OEM design wins occurring between the
first day of the quarter and the date your termination. The dollar amount shall
be calculated as specified in Section 8.5.

 

17.1.4.     Strategic
Win Incentive Claim Forms and the evidence of the win must be submitted before
your last day of employment for OEM design wins occurring between the first day
of the quarter and the date your termination. The dollar amount shall be
calculated as specified in Section 9.5.

 

18.          Changes to the Compensation Plan

 

18.1.        The
company may change, quotas, commissions, or any other part of this plan at any
time.

 

19.          With-Holding

 

19.1.        Commissions
paid to employees will be subject to all of the standard with-holding
requirements of the country from which they are paid.

 

20.          General
Provisions

 

20.1 This plan does not constitute an
employment agreement and does not replace Ikanos’ “at-will” employment policy. This
plan supersedes all prior plans.

 

21.          Approvals

 

 

	
   

  	
   

  	
   

  	
   

  
	
  Chris Smith, Vice President of Human Resources

  	
   

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Rajesh Vashist, President and CEO

  	
   

  	
  Date

  	
   

  

 

7

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