Exhibit 10.3
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 1st day of March, 1996 (the
"Commencement Date") between STANDARD MICROSYSTEMS CORPORATION, a
corporation duly organized and existing under and by virtue of the laws
of the State of Delaware and having an office at 00 Xxxxx Xxxxx,
Xxxxxxxxx, Xxxx Xxxxxx, Xxx Xxxx 00000, hereinafter referred to as
"SMC" and XXXXXX XXXXXXXX, residing at Xxxxx Xxxxxxxxxxx Xxxxx,
Xxxxxxxxx, Xxx Xxxx 00000, hereinafter referred to as the "Employee".
WITNESSETH:
WHEREAS, SMC is engaged, among other things, in the
business of developing, manufacturing, and selling integrated circuits
and board-level products for use in the electronics industry and
principally in connecting personal computers over local area networks;
and
WHEREAS, SMC has for many years employed the Employee
and desires to continue to employ him in an executive, research and/or
engineering capacity, upon the terms and conditions hereinafter in this
Agreement set forth, and the Employee is desirous of being so employed;
and
WHEREAS, SMC controls various corporations and other
enterprises, the corporations and other enterprises from time to time
controlled by SMC being referred to in this Agreement as "SMC
Affiliates"; and
WHEREAS, the Employee is, on the Commencement Date,
employed as an Executive Vice President of SMC,
NOW, THEREFORE, in consideration of the premises, and
the mutual covenants and conditions herein contained, the parties
hereto agree as follows:
FIRST: SMC agrees to employ the Employee and the
Employee agrees to be employed pursuant to this Agreement for a period
commencing on the Commencement Date and ending on the day preceding the
third anniversary of the Commencement Date; provided that SMC may
terminate such
employment on any earlier date by giving the Employee notice of the
effective date of such termination, which notice shall be accompanied
by SMC's check for an amount equal to one year's compensation at the
then current rate fixed pursuant to Paragraph THIRD (a) (less
appropriate tax deductions) payable to the Employee. The Employee shall
serve as an officer of SMC in such offices to which he may be elected
or appointed, and shall perform such other duties for SMC and SMC
Affiliates as shall be assigned to him from time to time during the
continuance of this Agreement by the Board of Directors, the Chairman
or the President of SMC. The Employee agrees to apply his experience
and skill to such problems as shall be presented to him from time to
time in connection with the business of SMC and SMC Affiliates. The
Employee may be required to spend a significant portion of his business
time traveling on behalf of SMC. However, if the Employee is assigned,
as provided in this paragraph, to conduct his principal activities or
have his headquarters at a location outside the Hauppauge, Long Island
area (hereby defined to include all points within fifty miles of
Hauppauge, Long Island, New York), the Employee may, within ninety days
thereafter, terminate this Agreement by notice given to SMC, in which
event SMC shall pay the Employee an amount equal to one year's
compensation at the then current rate fixed pursuant to Paragraph THIRD
(a).
SECOND: The Employee shall give his full time,
attention, best efforts and skill to SMC and the SMC Affiliates, shall
accept willingly and carry out the duties assigned to him in the
furtherance of the business of SMC and the SMC Affiliates and shall not
engage in any activity in conflict with the best interests of SMC and
the SMC Affiliates. In addition to the compensation set forth in
paragraph THIRD and in consideration for his services to SMC, SMC
agrees to make available to the Employee the benefits and privileges
regularly granted to other senior executives of SMC.
THIRD: (a) SMC shall pay to the Employee, and the
Employee agrees to accept as compensation for and in consideration of
the work to be performed hereunder by the Employee, a weekly salary at
the rate of $296,300 per annum during the term of this Agreement. The
rate of compensation shall be subject to annual increase, but not
reduction, in the discretion of the Board of Directors, after review
and recommendation by the Compensation Committee of the Board. Any such
increase shall be effective as of the first day of
the fiscal year for which such increase is approved, unless otherwise
determined by the Board.
(b) In addition, as bonus compensation to
the Employee, SMC shall pay to the Employee, not later than 120 days
after the end of each fiscal year of SMC included in the term of this
Agreement, such amount (if any), related to consolidated net income of
SMC, and/or a specified division of SMC for such year, before deduction
of federal and state income taxes and incentive compensation to
employees, as shall be determined in its discretion by the Compensation
Committee of the Board of Directors of SMC or, if there be no such
Compensation Committee, then by the Board of Directors of SMC. In
determining consolidated net income for the purpose of the preceding
sentence, such additions and subtractions from such income (as
determined by SMC's independent accountants or by SMC) shall be given
effect as such Compensation Committee or Board shall from time to time
in its discretion prescribe.
FOURTH: The Employee has executed a Patent and Trade
Secrets Agreement with SMC of even date herewith, the provisions of
which shall be deemed to be incorporated as part of this Agreement.
FIFTH: The Employee has executed a Severance Pay
Agreement with SMC dated January 20, 1988 and several extensions
thereof of which the latest is of even date herewith, the provisions of
which shall be deemed to be incorporated as part of this Agreement. The
rights and remedies under such Severance Pay Agreement are in addition
to, and not in limitation of, any rights or remedies which the Employee
may have under this Agreement, provided that in no event shall the
damages payable to the Employee under this Agreement and the severance
payments to which the Employee may be entitled under SectionE4.3(B) and
4.4(B) of such Severance Pay Agreement exceed the greater of (i) the
balance (if any) of remuneration which would have been payable to the
Employee under this Agreement, if all such remuneration were paid to
the Employee under this Agreement as and when due, or (ii) the
severance payments to which the Employee may be entitled under Section
4.3(B) or 4.4(B), as may be applicable, of such Severance Pay
Agreement; provided further that in the event that Section 4.7 of such
Severance Pay Agreement shall be applicable, such damages and payment
shall be so reduced as may be required under such Section 4.7.
SIXTH: Any notice or other communication given under
this Agreement to either party shall be in writing and shall be
delivered at or mailed to such party at the address of such party
appearing at the head of this Agreement; provided that either party may
by notice designate a changed address for such party. Any such notice
shall be deemed given (a)Eif mailed properly addressed, postage
prepaid, certified mail, return receipt requested, on the third
business day after mailing in Northport, New York or Hauppauge, New
York, or (b)Eif delivered otherwise than pursuant to (a), at the time
of actual delivery.
IN WITNESS WHEREOF, SMC has caused this Agreement to
be executed on its behalf by its representative, thereunto duly
authorized, and the Employee has executed this Agreement as of the day
and year first above written.
STANDARD MICROSYSTEMS CORPORATION
By:______________________________
Xxxx Xxxxxxx, Chairman
Xxxxxx Xxxxxxxx, Employee
