Employment Agreement - Transmeta Corp. and Matthew R. Perry
March 21, 2002
Matthew R. Perry, Ph.D.
Austin, TX
Re: Offer of Employment as President and Chief Executive Officer
Dear Dr. Perry:
Transmeta Corporation ("Transmeta" or the "Company") is very pleased to
offer you a position as President and Chief Executive Officer of the Company,
and as a member of the Company's Board of Directors. On behalf of the Company
and its Board of Directors, I am delighted to welcome you and look forward to
working with you.
Your position would be full time, with an annual base salary of $330,000
and participation in the Company's executive bonus plan, with a target bonus of
50 percent of your base salary. In addition, you would receive a starting bonus
of $150,000 and certain relocation benefits, including home loan assistance in
an amount up to $1 million.
You would also be granted an option to purchase up to 2,000,000 shares
of Transmeta common stock at fair market value measured by the market closing
price on your starting date. Your stock option would be fully vested as to
200,000 of those shares, and your stock option as to the other 1.8 million
shares would vest over a four-year period as follows: the first 25 percent of
your option would vest upon your first anniversary with the Company, after which
the remaining 75 percent would vest monthly (at an approximate rate of 2.08
percent per month) over the next three years, unless and until your employment
relationship with the Company should terminate.
In the event that the Company were to experience a change of control
(including but not limited to an acquisition or merger), and in the further
event that your employment were terminated without cause or otherwise eliminated
as a result of that change of control, your stock option would accelerate such
that you would be entitled to exercise one half of the remaining unvested
portion of your stock option. This stock option is not a promise of compensation
and is not intended to create any employment obligation on the part of the
Company.
As an employee of Transmeta, you would also be eligible to participate
in several Company-sponsored benefits, including medical, dental, vision, life,
and short-term/long-term disability insurance, a Flexible Spending Plan, and a
401K Plan.
<PAGE>
Matthew R. Perry, Ph.D.
March 21, 2002
Page 2
This offer contemplates an at-will employment relationship, which can be
terminated by you or by Transmeta for any reason, with or without cause, without
further obligation or liability (except that Transmeta will pay you salary and
related compensation through the last date worked).
Your employment is also contingent upon (1) your executing the enclosed
Proprietary Information and Inventions Agreement, and (2) your providing the
legally required proof of identity and eligibility to work in the United States.
To confirm your acceptance of this offer, please sign and date one copy
of this letter and return it to me. Sign and retain the other copy for your
records. This letter, along with the other agreements referred to above, set out
the terms of your employment relationship with Transmeta. This agreement
supersedes any prior representations or agreements between you and Transmeta,
whether written or oral.
Congratulations on joining Transmeta. We all look forward to working
with you.
Very truly yours,
Hugh Barnes
President & Chief Operating Officer
Accepted By: /s/ Matthew R. Perry Date: March 27, 2002
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