FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
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EX-10.18 3 dex1018.htm FIRST AMENDMENT TO EMPLOYMENT AGREEMENT First Amendment to Employment Agreement
Exhibit 10.18
FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT
This First Amendment to Employment Agreement effective as of January 1, 2009 is between AuthenTec, Inc., a Delaware corporation (the “Company”), and Larry Ciaccia (“Employee”) and modifies that Employment Agreement entered into between the parties and having an effective date of March 21, 2005 (the “Agreement”). AuthenTec and Employee agree as follows:
| 1. | Paragraph 2.(b)(ii)(B) is deleted from the Agreement in its entirety and replaced with: |
| “(B) | If the Company terminates Employee’s employment Without Cause pursuant to Section 2(b)(i)(C) or Employee terminates his employment in accordance with Section 2(b)(i)(D), the Company shall provide Employee with the following: |
| (I) | An amount equal to nine (9) months (not including accrued vacation) of Employee’s Base Compensation, payable in accordance with the Company’s payroll practices and a continuation of the additional insurance benefits described herein for such nine month period. |
Payment in an aggregate amount equal to nine (9) months of the COBRA costs associated with continuation of benefits under the Company’s player healthcare benefit plans (medical, dental, prescription) in which Employee participated immediately prior to Employee’s termination of employment. Payment will be made to the Employee as part of Employee’s final paycheck.
The foregoing amounts will be paid within sixty (60) days after Employee’s termination of employment.
| (II) | The assignment, at Employee’s option, of life and disability insurance policies insuring Employee, provided that, notwithstanding paragraph (I) above, Employee shall thereafter be responsible for any premium payments and transfer of any vested funds or other benefits under any of the Company’s ERISA or other benefit plans and such assignment shall only be permitted if allowed under the forms of the applicable insurance policy.” |
| 2. | The following paragraph will be inserted as a new Paragraph 2.(b)(iii)(D): |
| “(D) | Notwithstanding the foregoing provisions of this subsection, no stock option may be exercised after the end of the original maximum term of the option.” |
| 3. | The following paragraph will be inserted as a new Paragraph 4.(g): |
| “(g) | Compliance with Section 409A. |
| (i) | If the Company determines in good faith that any provision of this Agreement would cause Employee to incur an additional tax, penalty, or interest under Section 409A (“Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”), the Compensation Committee and Employee shall use reasonable efforts to reform such provision, if possible, in a mutually agreeable fashion to maintain to the maximum extent practicable the original intent of the applicable provision without violating the provisions of Section 409A or causing the imposition of such additional tax, penalty, or interest under Section 409A. The preceding provision, however, shall not be construed as a guarantee by the Company of any particular tax effect to Employee under this Agreement |
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| (ii) | For purposes of Section 409A, the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments. |
| (iii) | With respect to any reimbursement of expenses of, or any provision of in-kind benefits to, Employee, as specified under this Agreement, such reimbursement of expenses or provision of in-kind benefits shall be subject to the following conditions: (1) the expenses eligible for reimbursement or the amount of in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year, except for any medical reimbursement arrangement providing for the reimbursement of expenses referred to in Section 105(b) of the Code; (2) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (3) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit. |
| (iv) | “Termination of employment,” or words of similar import, as used in this Agreement means, for purposes of any payments under this Agreement that are payments of deferred compensation subject to Section 409A, the Employee’s “separation from service” as defined in Section 409A. |
| (v) | If a payment obligation under this Agreement or other compensation arrangement arises on account of Employee’s separation from service while Employee is a “specified employee” (as defined under Section 409A and determined in good faith by the Compensation Committee), any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) that is scheduled to be paid within six (6) months after such separation from service shall accrue without interest and shall be paid within 15 days after the end of the six-month period beginning on the date of such separation from service or, if earlier, within 15 days after the appointment of the personal representative or executor of Employee’s estate following his death.” |
| 4. | Paragraphs 4(g) and 4(h) in the original Agreement shall be renumbered as 4(h) and 4(i) respectively. |
IN WITNESS WHEREOF, the parties have executed this First Amendment to Employment Agreement as of the date first written above.
| THE COMPANY | EMPLOYEE | |||||||||
| AuthenTec, Inc. | ||||||||||
| By: | /s/ F. Scott Moody | /s/ Larry Ciaccia | ||||||||
| Name: | F. Scott Moody | Larry Ciaccia | ||||||||
| Title: | Chief Executive Officer | |||||||||
| Date: | 12/19/08 | Date: 12/19/08 | ||||||||
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