EXHIBIT 10.21
EMPLOYMENT SEPARATION AND RELEASE AGREEMENT
This Employment Separation and Release Agreement (the "Agreement") is
entered into between Xxxxxxxx X. Xxxxxxxx ("Executive") and Cadence Design
Systems, Inc. ("Cadence", and together with Executive, the "Parties").
1. TERMINATION DATE. Executive's employment with Cadence will
terminate at the close of business on January 30, 2004 (the "Termination Date");
provided, however, that Executive will be relieved of her duties effective
January 8, 2004 (the "Relinquish Date") and Executive will no longer report to
work, or otherwise have access to Cadence's computer system, including her
email, and her employment location, following the Relinquish Date.
2. SALARY AND BENEFITS THROUGH TERMINATION DATE. For the period
ending on the Termination Date, Executive will be paid all accrued salary, and
will continue to receive all benefits and participate in all benefit programs
for which Executive was eligible prior to the Termination Date. Cadence and
Executive acknowledge that no bonuses will be paid for 2003. Upon the
Termination Date, Executive will be eligible to continue health insurance
coverage pursuant to COBRA. Except as provided by this Agreement, Executive will
not be entitled to any other compensation or benefits following the Termination
Date. Executive's funds invested in Cadence's Non-Qualified Deferred
Compensation Plan, if any, shall be treated in accordance with the terms of that
Plan.
3. CONSIDERATION FOR ACCEPTANCE OF AGREEMENT. In consideration of
Executive's acceptance of this Agreement and to resolve disputed issues between
Executive and Cadence, and provided that on the Termination Date Executive
executes a release in substantially the form of Section 4 of this Agreement,
Cadence will provide Executive with the following, to which Executive otherwise
would not be entitled:
a. a separation payment of $515,200.00 (minus gross
salary paid from January 8, 2004 through January 30,
2004), less payroll deductions and withholdings
required by law, and deductions requested by
Executive, payable on the Termination Date, provided
that the Executive has returned all confidential,
proprietary and sensitive information to Xxx Xxxxx,
Cadence's Senior Vice President, Human Resources and
Organizational Development, including, but not
limited, to all hard and soft copy Cadence documents,
materials and files in Executive's possession.
b. vesting on the Effective Date of all outstanding
options and restricted stock held by Executive, as
enumerated in the attached schedule at Exhibit A.
Executive will have the period of time following her
Termination Date that is provided in the applicable
stock option agreement(s) (each of which provides for
no less than 30 days following the Termination Date;
provided however, that in no event shall any option
be exercisable following its expiration date) to
exercise the vested but unexpired portions. Cadence
will cause any affiliate legend to be removed
promptly
from the certificates representing shares purchased
on exercise of any of Executive's outstanding
options.
c. If Executive elects to continue her medical, dental
and vision insurance coverage under COBRA, Cadence
shall pay Executive's monthly COBRA premium until
June 30, 2005.
4. MUTUAL RELEASE OF CLAIMS.
a. Except as provided in Section 4(f) below, Executive
irrevocably, fully and finally releases Cadence, its parent, subsidiaries,
predecessors, successors, affiliates, employees, directors, officers, agents and
executives ("Releasees") from all causes of action, claims, suits, demands or
other obligations or liabilities, whether known or unknown, suspected or
unsuspected, that Executive ever had or now has as of the time that Executive
signs this Agreement. Except as provided in Section 4(f) below, the claims
released include, but are not limited to, any claims arising from or related to
Executive's employment with Cadence and with Simplex Solutions, Inc. and the
termination of her employment with Cadence, the acquisition of Simplex
Solutions, Inc. by Cadence and the Executive's compensation, including stock
options and restricted stock Executive received in conjunction with that
acquisition, including, but not limited to, claims arising under Title VII of
the Civil Rights Act of 1964 (as amended), the Civil Rights Act of 1991, the Age
Discrimination in Employment Act of 1967, the Older Worker Benefits Protection
Act, the Americans with Disabilities Act, the Equal Pay Act, the Fair Labor
Standards Act, the California Fair Employment and Housing Act, the California
Labor Code, the Employee Retirement Income and Security Act of 1974 (except for
any vested right Executive has to benefits under an ERISA plan), the state and
federal Worker Adjustment and Retraining Notification Act, and the California
Business and Professions Code, any other local, state, federal, or foreign law
governing employment and the common law of contract and tort.
b. Except as provided in Section 4(f) below, Cadence
irrevocably, fully and finally releases Executive, as well as her heirs and
assigns, from all causes of action, claims, suits, demands or other obligations
or liabilities, whether known or unknown, suspected or unsuspected, that Cadence
ever had or now has as of the time that Cadence signs this Agreement. Except as
provided in Section 4(f) below, the claims released include, but are not limited
to, any claims arising from or related to Executive's employment with Cadence
and with Simplex Solutions, Inc. and the termination of her employment with
Cadence, the acquisition of Simplex Solutions, Inc. by Cadence and the
Executive's compensation, including stock options and restricted stock Executive
received in conjunction with that acquisition, any local, state, federal, or
foreign law governing employment and the common law of contract and tort.
c. The Parties each represent and warrant that neither
has filed any claim, charge or complaint against the each other. Executive
further warrants and represents that Executive has not filed any claim, charge
or complaint against a Releasee. Additionally, except as provided in Section
4(f) below, each Party intends that this release of claims cover all claims,
whether or not known to such Party.
d. Each Party recognizes the risk that, subsequent to
the execution of this Agreement, such Party may incur loss, damage or injury,
which such Party attributes to the
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claims encompassed by this release. Each Party expressly assumes this risk by
signing this Agreement and voluntarily and specifically waives any rights
conferred by 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 WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
e. Each Party represents and warrants that there has
been no assignment or other transfer of any interest in any claim by such Party
that is covered by this release.
f. Notwithstanding anything in this Agreement to the
contrary, this Section 4 shall not apply to (i) claims Executive may have
against Cadence under the Indemnity Agreement between Executive and Cadence,
which is attached hereto as Exhibit B, (ii) claims Cadence may have against the
Executive under Executive's Noncompetition Agreement dated April 24, 2002 (as
modified by Section 5(d) below) and (iii) claims Cadence may have against
Executive under Executive's Employee Proprietary Information and Inventions
Agreement dated April 22, 2002.
5. OBLIGATIONS.
a. On or prior to the Relinquish Date, Executive will
have returned all Cadence property pursuant to the
Executive's Exit Interview Checklist (such as
Executive's computer, Blackberry, cellular phone and
badge).
b. Executive specifically acknowledges her continuing
obligations under the Noncompetition Agreement, dated
April 24, 2002, (as modified by Section 5(d) below)
which is attached hereto as Exhibit C, and that
except as provided in Section 5(d), this Agreement is
not intended to alter or modify those continuing
obligations.
c. During Executive's employment, Executive has had
access to Cadence's confidential and/or proprietary
information, and such information belonging to third
parties that Cadence has an obligation to keep
confidential. Executive will continue to hold that
information in confidence and will not disclose or
use such information. Executive represents that
Executive has returned to Cadence all copies and
records in any form of such information. Executive
further affirms that Executive received, read and
understood Cadence's Code of Conduct while employed
with Cadence, and abided by it. Executive
specifically acknowledges her continuing obligations
under Executive's Employee Proprietary Information
and Inventions Agreement dated April 22, 2002 and her
Noncompetition Agreement dated April 24, 2002 (as
modified by Section 5(d) below).
d. Cadence acknowledges that Executive's continuing
obligations under Section 1 of the Noncompetition
Agreement, dated April 24, 2002, which is attached
hereto as Exhibit B, shall terminate on December 31,
2004.
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6. CONFIDENTIALITY OF TERMINATION DISCUSSIONS AND AGREEMENT. From
the date termination notice was given to Executive through the Effective Date of
this Agreement shall be called the Notice Period. During the Notice Period,
Executive will keep strictly confidential (both within and outside Cadence) the
discussions concerning her termination from Cadence, including the fact and
terms of this Agreement. During the Notice Period, Executive may only discuss
her termination from Cadence and the fact and terms of this Agreement with her
spouse and legal advisor, as long as Executive instructs those individuals to
maintain the confidentiality of that information and they agree to do so. After
Cadence issues an internal announcement regarding Executive's termination, in
substantially the form attached hereto as Exhibit D, both Parties agree that, to
the extent either Party discusses Executive's termination from Cadence, such
Party will say no more about Executive's termination than what is stated in such
announcement. After the Effective Date of this Agreement, Executive will
continue to keep confidential the fact and terms of this Agreement, including
the consideration to be provided to Executive under it, except that Executive
may disclose that information to (a) Executive's spouse, legal advisor, and tax
advisor, as long as Executive instructs those individuals to maintain the
confidentiality of that information and they agree to do so or (b) the extent
the information is otherwise publicly disclosed in a Securities and Exchange
Commission filing made by the Company. Notwithstanding the preceding, it will
not be a violation of this Section 6 for either Party to discuss Executive's
termination if such Party is required to do so by legal process or required or
requested to do so by an official investigative or judicial proceeding invoked
by a governmental agency, other than disclosures by Executive pursuant to an
investigative or judicial proceeding instigated by the actions of Executive.
7. NONDISPARAGEMENT. During the Notice Period, and thereafter,
the Parties agree not to criticize, denigrate, or make statements (whether oral
or written) that would otherwise reflect negatively on the reputation of
Executive, Releasees or Cadence's products, employment practices, compensation
policies and practices or business practices. Additionally, Cadence agrees to
instruct its executive officers and directors to comply with the preceding
sentence. The Parties further agree that neither will aid, assist, advise,
counsel, or testify on behalf of, any other person pursuing any claim, charge,
or complaint adverse to the Executive or Releasees, including, but not limited
to, Cadence and its executives, except to the extent either Party is required to
do so by legal process or required or requested to do so by an official
investigative or judicial proceeding invoked by a governmental agency (except in
the case of Executive, pursuant to an investigative or judicial proceeding
instigated by Executive). Executive and Cadence acknowledge that in the event of
a breach of this paragraph, such breach will cause irreparable harm to the other
Party. Executive warrants and agrees that in the event she breaches her
obligations as enumerated in this paragraph, the $515,200 paid by Cadence to the
Executive pursuant to this Agreement shall be immediately due and repayable by
Executive to Cadence as liquidated damages; provided, however, that factual
statements made by Executive as required by legal process or required or
requested by an official investigative or judicial proceeding invoked by a
governmental agency, other than statements made by Executive pursuant to an
investigative or judicial proceeding instigated by Executive, shall not, in and
of themselves, constitute a violation of this Section 7. Both Parties agree
that, in the event the other Party breaches its obligations under this
paragraph, the non-breaching Party shall be entitled to injunctive relief to
prevent further conduct in violation of this paragraph, and to an award of
judgment in the amount of all attorneys' fees necessarily and reasonably
incurred by such Party to secure such relief.
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8. CONTINUED COOPERATION. During the Notice Period, and following
the termination of employment, Executive shall fully cooperate with Cadence in
all matters relating to her employment, including, but not limited to, the
winding up of her pending work on behalf of Cadence and the orderly transfer of
any such pending work to other executives of Cadence as may be designated by
Cadence. In addition, Executive shall cooperate with Cadence, as requested by
Xxx Xxxxxxx, Chief Executive Officer of Cadence (or his successor(s)), Xx.
Xxxxxxx'x designees (or his successor(s)'s designees) or Cadence's Board of
Directors on matters relating to the work she performed at Cadence, including,
but not limited to, consulting with Cadence on matters related to customers,
marketing, research and development and any legal matters that may arise in the
future about which Executive has knowledge.
9. REVIEW OF AGREEMENT; REVOCATION OF ACCEPTANCE. Executive has
21 days in which to review and consider this Agreement, although Executive is
free to accept this Agreement anytime within that 21-day period. Executive is
advised to consult with an attorney about the Agreement. If Executive accepts
this Agreement, Executive will have an additional 7 days from the date that
Executive signs this Agreement to revoke that acceptance, which Executive may
effect by means of a written notice sent to X.X. Xxxxx XxXxxxxxx. If this 7-day
period expires without a timely revocation, this Agreement will become final on
the eighth day following the date of Executive's signature, which date will
become the "Effective Date" of this Agreement.
10. FULL SATISFACTION OF COMPENSATION OBLIGATIONS; ADEQUATE
CONSIDERATION. Executive agrees that the payments and benefits provided herein
are in full satisfaction of all obligations of Cadence to Executive arising out
of or in connection with Executive's employment through the Termination Date and
in Executive's offer letter, dated April 22, 2002, including, without
limitation, all compensation, salary, bonuses, reimbursement of expenses, and
benefits. Executive further acknowledges that the separation payment and the
vesting and acceleration of stock options and restricted stock grants provided
for in Section 3 of this Agreement constitute adequate consideration for the
covenants and releases given by the Executive in this Agreement.
11. ARBITRATION. All claims, disputes, questions, or controversies
arising out of or relating to this Agreement or to Executive's employment and
the termination of that employment with Cadence, including, without limitation,
the construction or application of any of the terms, provisions, or conditions
of this Agreement, will be resolved exclusively in final and binding arbitration
in accordance with the Arbitration Rules and Procedures, or successor rules then
in effect, of Judicial Arbitration & Mediation Services, Inc. ("JAMS"). The
arbitration will be held in the San Jose, California, metropolitan area, and
will be conducted and administered by JAMS. Executive and Cadence will select a
mutually acceptable, neutral arbitrator from among the JAMS panel of arbitrator.
Except as provided by this Agreement, the Federal Arbitration Act will govern
the administration of the arbitration proceedings. The arbitrator will apply the
substantive law (and the law of remedies, if applicable) of the State of
California, or federal law, as applicable, and the arbitrator is without
jurisdiction to apply any different substantive law. Executive and Cadence will
each be allowed to engage in adequate discovery, the scope of which will be
determined by the arbitrator consistent with the nature of the claim(s) in
dispute. The arbitrator will have the authority to entertain a motion to dismiss
and/or a motion for summary judgment by any party and will apply the standards
governing such motions under the Federal Rules of Civil Procedure. The
arbitrator will render a written award and supporting opinion that
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will set forth the arbitrator's findings of fact and conclusions of law.
Judgment upon the award may be entered in any court of competent jurisdiction.
Cadence will pay the arbitrator's fees, as well as all administrative fees,
associated with the arbitration. Each party will be responsible for paying their
own attorneys' fees and costs (including expert witness fees and costs, if any).
However, in the event a party prevails at arbitration on a statutory claim that
entitles the prevailing party to reasonable attorneys' fees as part of the
costs, then the arbitrator may award those fees to the prevailing party in
accordance with that statute.
12. NO ADMISSION OF LIABILITY. Nothing in this Agreement will
constitute or be construed in any way as an admission of any liability or
wrongdoing whatsoever by Cadence or Executive.
13. INTEGRATED AGREEMENT. This Agreement is intended by the
parties to be a complete and final expression of their rights and duties
respecting the subject matter of this Agreement, except that nothing in this
Agreement is intended to negate Executive's continuing obligations under
Cadence's Employee Proprietary Information and Inventions Agreement, dated April
22, 2002, and Executive's Noncompetition Agreement, dated April 24, 2002, (as
modified by Section 5(d)) or any other agreement governing the disclosure and/or
use of proprietary information, which Executive signed while working with
Cadence or its predecessors; nor to waive any of Executive's obligations under
state and federal trade secret laws.
14. MODIFICATION. This Agreement may not be modified unless such
modification is embodied in writing, signed by the party against whom the
modification is to be enforced.
15. SEVERABILITY. In the event that any part of this Agreement is
found to be void or unenforceable, all other provisions of the Agreement will
remain in full force and effect.
16. GOVERNING LAW. This Agreement will be governed and enforced in
accordance with the laws of the State of California without regard to its
conflict of laws provision.
EXECUTION OF AGREEMENT
The parties execute this Agreement to evidence their acceptance of it.
Dated: 12/24/03 By: /s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxxx X. Xxxxxxxx
CADENCE DESIGN SYSTEMS, INC.
Dated: 12/24/03 By: /s/ X.X. Xxxxx XxXxxxxxx
-------------------------------
X.X. Xxxxx XxXxxxxxx
Senior Vice President, General
Counsel and Secretary
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EXHIBIT B
INDEMNITY AGREEMENT
This Indemnity Agreement (this "Agreement"), dated as of April 1, 2003,
is made by and between Cadence Design Systems, Inc., a Delaware corporation (the
"Company"), and Xxxxxxxx Xxxxxxxx, Executive Vice President of the Company (the
"Indemnitee").
RECITALS
A. The Company is aware that competent and experienced persons
are increasingly reluctant to serve as directors or officers of corporations
unless they are protected by comprehensive liability insurance or
indemnification, due to increased exposure to litigation costs and risks
resulting from their service to such corporations, and due to the fact that the
exposure frequently bears no reasonable relationship to the compensation of such
directors and officers;
B. The statutes and judicial decisions regarding the duties of
directors and officers are often difficult to apply, ambiguous, or conflicting,
and therefore fail to provide such directors and officers with adequate,
reliable knowledge of legal risks to which they are exposed or information
regarding the proper course of action to take;
C. Plaintiffs often seek damages in such large amounts and the
costs of litigation may be so substantial (whether or not the case is
meritorious), that the defense and/or settlement of such litigation is often
beyond the personal resources of officers and directors;
D. The Company believes that it is unfair for its directors and
officers and the directors and officers of its subsidiaries to assume the risk
of large judgments and other expenses that may be incurred in cases in which the
director or officer received no personal profit and in cases where the director
or officer was not culpable;
E. The Company recognizes that the issues in controversy in
litigation against a director or officer of a corporation such as the Company or
a subsidiary of the Company are often related to the knowledge, motives and
intent of such director or officer, that the Indemnitee is usually the only
witness with knowledge of the essential facts and exculpating circumstances
regarding such matters and that the long period of time which usually elapses
before the trial or other disposition of such litigation often extends beyond
the time that the director or officer can reasonably recall such matters; and
may extend beyond the normal time for retirement for such director or officer
with the result that the Indemnitee, after retirement or in the event of the
Indemnitee's death, the Indemnitee's spouse, heirs, executors or administrators,
may be faced with limited ability and undue hardship in maintaining an adequate
defense, which may discourage such a director or officer from serving in that
position;
F. Based upon their experience as business managers, the Board of
Directors of the Company (the "Board") has concluded that, to retain and attract
talented and experienced individuals to serve as officers and directors of the
Company and its subsidiaries and to encourage such individuals to take the
business risks necessary for the success of the Company
and its subsidiaries, it is necessary for the Company to contractually
indemnify its officers and directors and the officers and directors of its
subsidiaries, and to assume for itself maximum liability for claims against such
persons in connection with their service;
G. The Company desires and has requested the Indemnitee to serve
or continue to serve as a director or officer of the Company and/or the
subsidiaries of the Company free from undue concern for claims for damages
arising out of or related to such services to the Company and/or the
subsidiaries of the Company; and
H. The Indemnitee is willing to serve, or to continue to serve,
the Company and/or the subsidiaries of the Company that the Indemnitee is
furnished the indemnity provided for herein.
AGREEMENT
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Definitions.
(a) Covered Person. For purposes of this Agreement, a
"covered person" shall include the Indemnitee and any heir, executor,
administrator or other legal representative of the Indemnitee following the
Indemnitee's death or incapacity.
(b) Expenses. For purposes of this Agreement, "expenses"
includes all direct and indirect costs of any type or nature whatsoever
(including, without limitation, all attorneys' fees and related disbursements
and other out-of-pocket costs) actually and reasonably incurred by the
Indemnitee in connection with either the investigation, defense or appeal of a
proceeding or establishing or enforcing a right to indemnification under this
Agreement, Section 145 of the Delaware General Corporation Law or otherwise.
(c) Proceeding. For the purposes of this Agreement,
"proceeding" means any threatened, pending, or completed action, suit or other
proceeding, whether civil, criminal, administrative, legislative, investigative
or any other type whatsoever, and including any of the foregoing commenced by or
on behalf of the Company, derivatively or otherwise.
(d) Subsidiary. For purposes of this Agreement,
"subsidiary" means any corporation of which more than 50% of the outstanding
voting securities is owned directly or indirectly by the Company, and one or
more other subsidiaries, or by one or more other subsidiaries.
2. Agreement to Serve. The Indemnitee agrees to serve and/or
continue to serve the Company and/or its subsidiaries in the Indemnitee's
present capacity, so long as the Indemnitee is duly appointed or elected or
until such time as the Indemnitee tenders a written resignation, provided,
however, that nothing contained in this Agreement is intended to create any
right to continued employment by Indemnitee.
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3. Maintenance of Liability Insurance.
(a) The Company hereby covenants and agrees that, so long
as the Indemnitee shall continue to serve as an officer or director of the
Company or any of its subsidiaries, and thereafter so long as the Indemnitee
shall be subject to any possible proceeding by reason of such service, the
Company, subject to Section 3(b), shall use reasonable efforts to obtain and
maintain in full force and effect directors' and officers' liability insurance
("D&O Insurance") in reasonable amounts from established and reputable insurers.
(b) Notwithstanding the foregoing, the Company shall have
no obligation to obtain or maintain D&O Insurance if the Company determines in
good faith that such insurance is not reasonably available, the premium costs
for such insurance are disproportionate to the amount of coverage provided, the
coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit, or the Indemnitee is covered by similar insurance
maintained by a subsidiary of the Company.
4. Mandatory Indemnification.
(a) Right to Indemnification. In the event a covered
person was or is made a party or is threatened to be made a party to or is
involved in any proceeding, by reason of the fact that the Indemnitee is or was
a director, officer or employee of the Company (including any subsidiary or
affiliate thereof or any constituent corporation or any of the foregoing
absorbed in any merger) or is or was serving at the request of the Company
(including such subsidiary, affiliate or constituent corporation) as a director,
officer or employee of another corporation, or of a partnership, joint venture,
trust or other entity, including service with respect to employee benefit plans,
such person shall be indemnified and held harmless by the Company to the fullest
extent permitted by applicable law, against all expenses, liability and loss
(including, without limitation, attorneys' fees, judgments, fines, ERISA excise
and other taxes and penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in connection therewith. Such
indemnification shall continue after the Indemnitee has ceased to serve in such
capacity and shall inure to the benefit of the Indemnitee's heirs, executors and
administrators; provided, however, that except for a proceeding pursuant to
Section 7, the Company shall indemnify any such person in connection with a
proceeding (or part thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board of Directors of the Company.
(b) Exception for Amounts Covered by Insurance.
Notwithstanding the foregoing, the Company shall not be obligated to indemnify a
covered person for expenses or liabilities of any type whatsoever (including,
but not limited to, judgments, fines, forfeitures, attorneys' fees, ERISA excise
taxes or penalties, and amounts paid in settlement) which have been paid
directly to such person by D&O Insurance.
(c) Partial Indemnification. If a covered person is
entitled under any provision of this Agreement to indemnification by the Company
for some or a portion of any expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines, forfeitures, attorneys' fees,
ERISA excise taxes or penalties, and amounts paid in settlement) incurred by the
Indemnitee in the investigation, defense, settlement or appeal of a proceeding
but
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not entitled, however, to indemnification for all of the total amount thereof,
the Company shall nevertheless indemnify such person for such total amount
except as to the portion thereof to which the Indemnitee is not entitled.
5. Mandatory Advancement of Expenses. The Company shall pay all
expenses incurred by a covered person, or in defending any such proceeding as
they are incurred in advance of its final disposition; provided, however, that
if the Delaware General Corporation Law then so requires, the payment of such
expenses incurred in advance of the final disposition of such proceeding shall
be made only upon delivery to the Company of an undertaking, by or on behalf of
such covered person, to repay all amounts so advanced if it should be determined
ultimately that such person is not entitled to the payment of such expenses by
the Company.
6. Notice and Other Indemnification Procedures.
(a) Promptly after receipt by a covered person of notice
of the commencement of or the threat of commencement of any proceeding, such
person shall, if such person believes that indemnification with respect thereto
may be sought from the Company under this Agreement, notify the Company of the
commencement or threat of commencement thereof.
(b) If, at the time of the receipt of a notice of the
commencement of a proceeding, the Company has D&O Insurance in effect, the
Company shall give prompt notice of the commencement of such proceeding to the
insurers in accordance with the procedures set forth in the respective policies.
The Company shall thereafter take all necessary or desirable action to cause
such insurers to pay, on behalf of the covered person, all amounts payable as a
result of such proceeding in accordance with the terms of such policies.
(c) In the event the Company shall be obligated to
advance the expenses for any proceeding against the covered person, the Company,
if appropriate, shall be entitled to assume the defense of such proceeding, with
counsel approved by the covered person (such approval not to be unreasonably
withheld or delayed), upon the delivery to the covered person of written notice
of its election so to do. After delivery of such notice, approval of such
counsel by the covered person and the retention of such counsel by the Company,
the Company will not be liable to the covered person under this Agreement for
any fees of counsel subsequently incurred by the covered person with respect to
the same proceeding, provided that (i) the covered person shall have the right
to employ separate counsel in any such proceeding at the covered person's
expense; and (ii) if (A) the employment of counsel by the covered person has
been previously authorized by the Company, (B) the Company shall not, in fact,
have employed counsel to assume the defense of such proceeding, or (C) it is
determined by legal counsel for the Company and the Indemnitee that a conflict
of interest exists requiring the Indemnitee to retain separate counsel, the fees
and expenses of the covered person's counsel shall be at the expense of the
Company.
7. Right of Indemnitee to Bring Suit. If a claim for
indemnification or advancement of expenses hereunder is not paid in full by the
Company within sixty days after a written claim has been received by the
Company, except in the case of a claim for an advancement of expenses, in which
case the applicable period shall be twenty days, the covered person may at any
time thereafter bring suit against the Company to recover the unpaid amount of
the claim. If
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successful in whole or in part in any such suit, or in a suit brought by the
Company to recover and advancement of expenses pursuant to the terms of an
undertaking, the covered person shall be entitled to be paid also the expense of
prosecuting or defending such suit. In any suit brought by a covered person to
enforce a right to indemnification hereunder (but not in a suit brought by a
covered person to enforce a right to an advancement of expenses) it shall be a
defense that indemnification is not permitted by applicable law. Further, in any
suit by the Company to recover an advancement of expenses pursuant to the terms
of an undertaking, the Company shall be entitled to recover such expenses upon a
final adjudication that indemnification is not permitted by applicable law.
Neither the failure of the Company (including its Board of Directors,
independent legal counsel or its stockholders) to have made a determination
prior to the commencement of such suit that indemnification of the covered
person is proper in the circumstances, nor an actual determination by the
Company (including its Board of Directors, independent legal counsel or its
stockholders) that indemnification is not proper, shall create a presumption
that the covered person is not entitled to indemnification or, in the case of
such a suit brought by a covered person, be a defense to such suit. In any suit
brought by a covered person to enforce a right to indemnification or to an
advancement of expenses hereunder, or by the Company to recover an advancement
of expenses pursuant to the terms of an undertaking, the burden of proving that
the covered person is not entitled to be indemnified, or to such advancement of
expenses, shall be on the Company.
8. Limitation of Actions and Release of Claims. No proceeding
shall be brought and no cause of action shall be asserted by or on behalf of the
Company or any subsidiary against the Indemnitee, the Indemnitee's spouse,
heirs, estate, executors or administrators after the expiration of one year from
the act or omission of the Indemnitee upon which such proceeding is based;
however, in a case where the Indemnitee fraudulently conceals the facts
underlying such cause of action, no proceeding shall be brought and no cause of
action shall be asserted after the expiration of one year from the earlier of
(i) the date the Company or any subsidiary of the Company discovers such facts,
or (ii) the date the Company of any subsidiary of the Company could have
discovered such facts by the exercise of reasonable diligence. Any claim or
cause of action of the Company or any subsidiary of the Company, including
claims predicated upon the negligent act or omission of the Indemnitee, shall be
extinguished and deemed released unless asserted by filing of a legal action
within such period. This Section 8 shall not apply to any cause of action which
has accrued on the date hereof and of which the Indemnitee is aware on the date
hereof, but as to which the Company has no actual knowledge apart from the
Indemnitee's knowledge.
9. Non-exclusivity. The provisions for indemnification and
advancement of expenses set forth in this Agreement shall not be deemed
exclusive of any other rights which the Indemnitee or any covered person may
have under any provision of law, the Company's Certificate of Incorporation or
Bylaws, the vote of the Company's shareholders or disinterested directors, other
agreements, or otherwise, both as to action in the Indemnitee's official
capacity and to action in another capacity while occupying the Indemnitee's
position as an officer, director or employee of the Company, and the
Indemnitee's right hereunder shall continue after the Indemnitee has ceased to
so act and shall inure to the benefit of any heir, executor, administrator or
other legal representative of the Indemnitee.
5
10. Interpretation of Agreement. It is understood that the parties
hereto intend this Agreement to be interpreted and enforced so as to provide
indemnification to the Indemnitee to the fullest extent now or hereafter
permitted by law.
11. Severability. If any provision or provisions of this Agreement
shall be held to be invalid, illegal or unenforceable for any reason whatsoever,
(i) the validity, legality and enforceability of the remaining provisions of the
Agreement (including, without limitation, all portions of any paragraphs of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall
not in any way be affected or impaired thereby, and (ii) to the fullest extent
possible, the provisions of this Agreement (including, without limitation, all
portions of any paragraphs of this Agreement containing any such provision held
to be invalid, illegal or unenforceable, that are not themselves invalid,
illegal or unenforceable) shall be construed so as to give effect to Section 10
hereof.
12. Modification and Waiver. No supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provision hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.
13. Successors and Assigns. The terms of this Agreement shall
bind, and shall inure to the benefit of, the successors and assigns of the
parties hereto.
14. Notice. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed duly
given (i) upon receipt, if delivered by hand, or (ii) on the third business day
after the mailing date, if mailed by certified or registered mail with postage
prepaid. Addresses for notice to either party are as shown on the signature page
of this Agreement, or as subsequently modified by written notice.
15. Governing Law. This Agreement shall be governed exclusively by
and construed according to the laws of the State of Delaware, as applied to
contracts between Delaware residents entered into and to be performed entirely
with Delaware.
16. Consent to Jurisdiction. The Company and the Indemnitee each
hereby irrevocably consent to the jurisdiction of the courts of the State of
Delaware for all purposes in connection with any action or proceeding which
arises out of or relates to this Agreement
The parties hereto have entered into this Indemnity Agreement effective
as of the date first above written,
CADENCE DESIGN SYSTEMS, NC.
By: /s/ X.X.Xxxxx XxXxxxxxx
------------------------------
RL. Xxxxx XxXxxxxxx
Sr. Vice President, General Counsel and
Secretary
6
INDEMNITEE
/s/ Xxxxxxxx Xxxxxxxx
----------------------------------------------
Name: Xxxxxxxx Xxxxxxxx
Address: _____________________________________
_____________________________________
7
EXHIBIT C
NONCOMPETITION AGREEMENT
NONCOMPETITION AGREEMENT
THIS NONCOMPETITION AGREEMENT (this "Agreement") is entered into as of
April 24, 2002, by and among Cadence Design Systems, Inc., a Delaware
corporation ("Parent"), Simplex Solutions, Inc., a Delaware corporation (the
"Company"), and Xx. Xxxxxxxx X. Xxxxxxxx ("Stockholder"). The Closing Date, as
defined in the Merger Agreement (as defined below), shall be the "Effective
Date" of this Agreement.
RECITALS
A. Parent and the Company are engaged in the research, design and
development of electronic design automation software and products, such products
containing hardware, software and both hardware and/or software products,
designs and solutions for, and all intellectual property embodied in the
foregoing, and in commercial electronic design services and/or maintenance
services, such services including all intellectual property embodied in the
foregoing (the "Business").
B. The Company has entered into an Agreement and Plan of Merger
with Parent and Zodiac Acquisition, Inc. ("Acquisition"), a wholly-owned
subsidiary of Parent (the "Merger Agreement"), dated as of April 24, 2002, which
provides (subject to the conditions set forth therein) for the merger of
Acquisition with and into the Company with the Company as the surviving
corporation (the "Merger"). As a result of the Merger, the Company will become a
wholly-owned subsidiary of Parent, and Stockholder will receive shares of common
stock of Parent in exchange for Stockholder's shares of capital stock of the
Company. Capitalized terms used but not defined herein shall have their
respective meanings set forth in the Merger Agreement.
C. As a condition and essential inducement to Parents and
Acquisition's willingness to enter into the Merger Agreement and in
consideration of the transactions contemplated by the Merger Agreement,
including Stockholder's receipt of Merger Consideration in the Merger,
Stockholder has agreed to the noncompetition, nonsolicitation, confidentiality
and other agreements set forth in this Agreement In addition, Stockholder has
been offered and, concurrently with the execution of this Agreement, has
accepted employment with Parent contingent upon closing of the transactions
contemplated by the Merger pursuant to the terms of a written employment
agreement ("Employment Agreement").
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants and agreements in the Merger Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Stockholder hereby covenants and agrees as follows:
1. NONCOMPETITION.
(a) During the period commencing at the Effective Date
and ending on the date that is three (3) years after the date on which the
Effective Date occurs, Stockholder shall
2
not, directly or indirectly (including, without limitation, through any
existing or future Affiliate (as defined below)), own, manage, operate, control,
enable (whether by license, sublicense, assignment or otherwise) or otherwise
engage or participate in, or be a securityholder, director, officer, employee,
partner' member, lender, guarantor or advisor of, or consultant to, any company,
limited liability company, partnership or other Person (as defined below) that,
directly or indirectly, (1) engages in the Business in the Business Area (as
defined below), (2) competes in the Business in the Business Area against Parent
or any of its existing or future Affiliates engaged in the Business, or (3)
markets, distributes or sells any products that are marketed, distributed or
sold, directly or indirectly through intermediaries, in the Business Area that
are competitive to Business products marketed sold or distributed by Parent or
any of its existing or future Affiliates. Without limiting the generality of the
foregoing, Stockholder shall not, directly or indirectly (including, without
limitation, through any existing or future Affiliate or any other Person in
which Stockholder has an interest):
(i) engage in research, development,
manufacture, licensing, marketing,
distribution or sale of any existing or
future products or services relating to the
Business;
(ii) have any interest in, own, manage, operate,
control, be a securityholder (except as
permitted by Section 1(b)), joint venturer,
officer, director, agent, lender,
representative, partner or securityholder
of, or consultant to, or otherwise engage or
invest or participate in, the Business or
any Person that takes any of the actions
described in clauses (1), (2) and (3) of
this subsection (a);
(iii) accept any business relating to the Business
from any existing or prospective Business
customer of Parent or any existing or future
Affiliate of Parent engaged in the Business,
or solicit or encourage any such customer to
terminate or adversely alter any
relationship with respect to the Business
much Person may have with Parent or any of
its existing or future Affiliates engaged in
the Business; or
(iv) market, sell, distribute, endorse or promote
any products or services that are
competitive with existing or future Business
products or services of Parent or any of its
existing or future Affiliates engaged in the
Business.
(b) Notwithstanding anything to the contrary set forth in
Section 1(a):
(i) Stockholder may own (solely as a passive
investor) securities in any publicly-held
company that may be engaged in the Business,
hut only to the extent Stockholder does not
own, of record or beneficially, more than an
aggregate of two percent (2%) of the
outstanding Securities of such company that
represent (either directly or upon
conversion or exchange of any other
securities) equity ownership thereof; and
3
(ii) In connection with Stockholder's employment
with any Person, Stockholder may engage in
activities that are encompassed within the
Business, provided (A) that the results of
Stockholder's activities are used by
Stockholder's employer solely for internal
purposes for The development of integrated
circuits to be manufactured by such employer
and not for sale, license or use by third
parties and (B) Stockholder a employer does
not compete with Parent or any existing or
future Affiliates of Parent in the Business.
(c) The restrictions set forth in this Section 1 shall
apply worldwide (the "Business Area").
(d) As used herein, "Affiliate" means, with respect to
any Person, any other Person directly or indirectly controlling, controlled by
or under direct or indirect common control with such first Person.
(e) As used herein, "Person" means an individual,
corporation, partnership, limited liability company, association, trust,
unincorporated organization or other legal entity, including any Governmental
Entity.
2. NONSOLICITATION OF EMPLOYEES. During the period commencing at
the Effective Date and ending on the date that is three (3) years alter the date
on which the Effective Date occurs, Stockholder shall not, either on his or her
own account or for any company, limited liability company, partnership, joint
venture or other Person (including, without limitation. through any existing or
future Affiliate), solicit any employee of Parent or any existing or future
Affiliate of Parent to leave his or her employment or induce or attempt to
induce any such employee to terminate or breach his or her employment agreement
with Parent or any existing or future Affiliate of Parent, if any.
Notwithstanding the foregoing, Stockholder may place general advertisements for
prospective employees, either on his or her own account or for any company, in
media and in other forms directed to the general public, including but not
limited to newspapers, television, radio and non-Business specific Internet job
boards; provided that the hiring of any employee of Parent or any of its
existing or future Affiliates responding thereto shall be deemed a solicitation
of such person.
3. NONSOLICITATION OF CUSTOMERS AND SUPPLIERS. During the period
commencing at the Effective Date and ending on the date that is three (3) years
after the date on which the Effective Date occurs, Stockholder shall not,
directly or indirectly (including, without limitation, through any existing or
future Affiliate), solicit, cause in any part or encourage any current or future
customer of or supplier to Parent or any existing or future Affiliate of Parent
to cease doing business in whole or in part with Parent or any such Affiliate
with respect to the Business.
4. CONFIDENTIALITY. Stockholder has entered into an Employee
Proprietary Information and Inventions Agreement with Parent. The provisions of
Section 1 of such agreement are hereby incorporated by reference herein.
4
5. STAY OF TIME. In the event a court of competent jurisdiction
or other Person mutually selected by the parties to resolve any dispute
(collectively a "Court") has determined that Stockholder has violated the
provisions of this Agreement, the running of the time period of such provisions
so violated shall be automatically suspended as of the date of such violation
and shall be extended for the period of time from the date such violation
commenced through the date that the Court determines that such violation has
permanently ceased.
6. INJUNCTIVE RELIEF. The remedy at law for any breach of this
Agreement is and will be inadequate, and in the event of a breach or threatened
breach by Stockholder of this Agreement, Parent and its existing and future
Affiliates, if any, shall be entitled to an injunction restraining Stockholder
from breaching or otherwise violating any provision of this Agreement. Nothing
herein contained shall be construed as prohibiting Parent and its existing and
future Affiliates, from pursuing any other remedies available to it or them for
such breach or threatened breach, including, without limitation, the recovery of
damages from Stockholder.
7. NOTICE. All notices and other communications pursuant to this
Agreement shall be in writing and shall be deemed given if delivered personally,
telecopied, sent by nationally-recognized overnight courier or mailed by
registered or certified mail (return receipt requested), postage prepaid, to the
parties at the addresses set forth below or to such other address as the party
to whom notice is to be given may have furnished to the other parties hereto in
writing in accordance herewith. Any such notice or communication shall be deemed
to have been delivered and received (a) in the case of personal delivery, on the
date of such delivery, (b) in the case of telecopier, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (c) in the case of a
nationally-recognized overnight courier in circumstances under which such
courier guarantees next business day delivery, on the next business day after
the date when sent and (d) in the case of mailing, on the fifth business day
following that on which the piece of mail containing such communication is
posted:
if to Parent or Acquisition, to:
Cadence Design Systems, Inc.
0000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopier: (000) 000-0000
Attention: General Counsel
with a copy to:
Xxxxxx. Xxxx & Xxxxxxxx LLP
Xxx Xxxxxxxxxx Xxxxxx Xxxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Telecopier: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
if to Stockholder, to:
5
Xx. Xxxxxxxx X. Xxxxxxxx
_________________________
_________________________
_________________________
or to such other address as the person to whom notice is given may have
previously furnished to the other, in writing in the manner set forth above. Any
party hereto may give any notice, request, demand, claim or other communication
hereunder using any other moans (including ordinary mail or electronic mail),
but no such notice, request, demand, claim or other communication shall be
deemed to have been duly given unless and until it actually is received by the
individual for whom it is intended.
8. SEPARATE COVENANTS. This Agreement shall be deemed to consist
of a series of separate covenants, one for each line of business included within
the Business as it may be conducted by Parent and its existing and future
Affiliates and its successors, if any, on or after the date hereof, and each
city, county, state, country or other region included within the Business Area.
The parties expressly agree that the character, duration and geographical scope
of this Agreement are reasonable in light of the circumstances as they exist on
the date upon which this Agreement has been executed. However, should a
determination nonetheless be made by a Court of competent jurisdiction at a
later date that the character, duration or geographical scope of this Agreement
is unreasonable in light of the circumstances as they then exist, then it is the
intention and the agreement of Parent and Stockholder that this Agreement shall
be construed by the Court in such a manner as to impose only those restrictions
on the conduct of Parent and Stockholder that are reasonable in light of the
circumstances as they then exist and as are necessary to assure Parent and its
existing and future Affiliates of the intended benefit of this Agreement. If, in
any proceeding, a Court shall refuse to enforce all of the separate covenants
deemed included herein because, taken together, they are more extensive than
necessary to assure Parent and its existing and future Affiliates of the
intended benefit of this Agreement, it is expressly understood and agreed among
the parties hereto that those of such covenants that, if eliminated, would
permit the remaining separate covenants to be enforced in such proceeding shall,
for the purpose of such proceeding, be deemed eliminated from the provisions
hereof.
9. SEVERABILITY. If any provision of this Agreement shall
otherwise contravene or be invalid under the laws of any state, country or other
jurisdiction where this Agreement is applicable but for such contravention or
invalidity, such contravention or invalidity shall not invalidate all of the
provisions of this Agreement but rather it shall be construed, insofar as the
laws of that state or other jurisdiction are concerned, as not containing the
provision or provisions contravening or invalid under the laws of that state or
jurisdiction, and the rights and obligations created hereby shall be construed
and enforced accordingly.
10. GOVERNING LAW; ARBITRATION.
(a) This Agreement shall be construed in accordance with
and governed by the internal laws (without reference to choice or conflict of
laws) of the State of Delaware.
(b) Each of the parties expressly agrees that to the
extent permitted by law and to the extent that the enforceability of this
Agreement is not thereby impaired, any and all
6
disputes, controversies or claims between Patent and Stockholder arising from or
relaxing to this Agreement, except for matters covered by Section 6 hereof,
shall be determined exclusively by final and binding arbitration before a single
arbitrator in accordance with then existing rules of the American Arbitration
Association ("AAA").
(c) The arbitration shall be held in the San Jose,
California metropolitan area, and shall be administered by the AAA. Under such
proceeding, the parties shall select a mutually acceptable, neutral arbitrator
from among the AAA panel of arbitrators. In the event the parties cannot agree
on an arbitrator, the Administrator of AAA shall appoint an arbitrator. Neither
party nor the arbitrator shall disclose the existence, content or results of any
arbitration hereunder without the prior written consent of all parties, except
as may be compelled by court order. Except as provided herein, the Federal
Arbitration Act shall govern the interpretation and enforcement of such
arbitration and all proceedings. The arbitrator shill apply the substantive law
(and the law of remedies, if applicable) of the State of Delaware, or Federal
law, if Delaware law is preempted, and the arbitrator is without jurisdiction to
apply any different substantive law. The parties agree that both parties will be
allowed to engage in adequate discovery, the scope of which will be determined
by the arbitrator, consistent with the nature of the claims in dispute. The
arbitrator shall have the authority to entertain a motion to dismiss and/or a
motion for summary judgment by any party and shall apply the standards governing
such motions under the Federal Rules of Civil Procedure. The arbitrator shall
render an award that shall include a written statement of opinion setting forth
the arbitrator's findings of fact and conclusions of law. Judgment upon the
award may be entered in any court having jurisdiction thereof. The parties
intend this arbitration provision to be valid, enforceable, irrevocable and
construed as broadly as possible.
(d) Costs of arbitration, except attorneys' fees or
expert fees that Stockholder may incur, shall be borne and paid by Parent. If
any party prevails on a statutory claim that entitles the prevailing party to
reasonable attorneys' fees (with or without expert fees), the arbitrator may
award reasonable attorneys' fees (with or without expert fees) to the prevailing
party in accord with such statute.
(e) Notwithstanding the foregoing provisions of this
Section 10, either Stockholder or Parent may seek and obtain otherwise available
injunctive relief in a court of competent jurisdiction for any violation this
Agreement that cannot be adequately remedied at law or in arbitration. Any such
injunctive proceedings shall be without prejudice to any rights Parent or
Stockholder may have under this Agreement to obtain relief in arbitration with
respect to such matters. The parties hereto hereby consent to the jurisdiction
of Sate and federal courts located in the State of Delaware for purposes of this
clause (e).
11. AMENDMENTS AND WAIVERS.
(a) This Agreement may be modified only by a written
instrument duly executed by each party hereto.
(b) No waiver by a party of any default,
misrepresentation or breach of a warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation or breach of a warranty or covenant hereunder or
7
affect in any way any rights arising by virtue of any prior or subsequent
occurrence. No failure or delay by a party hereto in exercising any right, power
or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided under applicable law.
12. ATTORNEYS' FEES. Should any litigation, arbitration or other
proceeding be commenced between the parties concerning this Agreement
(including, without limitation, the enforcement hereof and the rights and duties
of the parties hereunder), the party prevailing shall be entitled, in addition
to such other relief as may be granted, such party's attorneys' fees and
expenses in connection with such litigation, arbitration or other proceeding.
13. ENTIRE AGREEMENT. This Agreement, together with the Merger
Agreement and the ancillary documents referred to in the Merger Agreement and
executed in connection therewith, contains the entire understanding of the
parties, supersedes all prior and contemporaneous agreements and understandings
relating to the subject matter hereof.
14. COUNTERPARTS, FACSIMILE. This Agreement may be executed by the
parties in separate counterparts and by facsimile, each of which, when so
executed and delivered, shall be enforceable against the parties actually
executing such counterparts, and all of which, when taken as a whole, shall
constitute one and the same instrument.
15. SECTION HEADINGS AND REFERENCES. The headings of each Section,
subsection or other subdivision of this Agreement are for reference only and
shall not limit or control the meaning thereof. All references herein to a
Section arc references to a Section of this Agreement, unless otherwise
specified, and include all subparts thereof.
16. ASSIGNS. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, heirs, personal
representatives and permitted assigns. Neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason hereof nor any of
the documents executed in connection herewith may be assigned by any party
without the consent of the other parties; provided, however, that Parent may
assign its rights hereunder, without the consent of Stockholder, to any existing
or future Affiliate of Parent and to any Person that acquires or succeeds to all
or any part of the Business. No such assignment shall relieve the assigning
party of its obligations hereunder if such assignee does not perform such
obligations.
17. FURTHER ASSURANCES. From time to time, at Parent's request and
without further consideration, Stockholder shall execute and deliver such
additional documents and take all such further action as reasonably requested by
Parent to be necessary or desirable to make effective, in the most expeditious
manner possible, the terms of this Agreement.
18. EXPENSES. Each party hereto shall pay his, her or its own
expenses in connection with this Agreement.
19. TERM; TERMINATION. The term of this Agreement commences on the
Effective Date and shall terminate the earlier of either (i) three (3) years
from the Effective Date, or (2) in
8
the event Parent fails to pay any amounts due to Stockholder pursuant to Section
5 of the Employment Agreement within a reasonable time after either Parent
agrees or an arbitrator has determined in its written statement of opinion
delivered pursuant to Section 14 of the Employment Agreement that Stockholder
was terminated without cause (as defined in the Employment Agreement) or
Stockholder resigned with good reason (as defined in the Employment Agreement).
9
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed on its behalf as of the day and year first above written.
CADENCE DESIGN SYSTEMS, INC.
By: /s/ Xxxxxxx Xxxxxx
----------------------------
Name: Xxxxxxx Xxxxxx
Title: Sr. VP & CFO
SIMPLEX SOLUTIONS, INC.
By: /s/ Xxxx Xxxxxx
----------------------------
Name: Xxxx Xxxxxx
Title: CFO
STOCKHOLDER
By: /s/ Xxxxxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxxxxx X. Xxxxxxxx
10
EXHIBIT D
FORM OF ANNOUNCEMENT
To: All Cadence
From: Xxx Xxxxxxx
Re: Xxxxx Xxxxxxxx
Xxxxx has decided to step down from her position as Executive Vice President and
General Manager of the Design and Verification Division. This change is
effective immediately.
Since the formation earlier this year of the design and verification division,
we have made great strides in establishing our presence and technology in the
marketplace. [Additional internal communication items to be added.]
Since joining Cadence in 2002, Xxxxx has made many important contributions. As
Chief Marketing Officer, she rearchitected our marketing programs, and led
strategic planning and the Cadence Design Foundry business. As the first head of
the new Design and Verification division, she brought focus to our customers'
needs in this critical area, and zeal in establishing Cadence's solutions in
this space. And as a member of my executive team, she has made important
contributions to our technology roadmap, our merger and acquisitions strategy,
and our communications with our customers, investors and partners.
As we go into 2004, Xxxxx has decided that she wants to step back from an
operating role at Cadence, as she repositions herself to be a chief executive
officer. During the course of the New Year, while she identifies such an
opportunity, Xxxxx intends to spend time with her family and work with me as
needed to transition her responsibilities and duties. I am grateful for Penny's
contributions to Cadence, and I know that you will join me in wishing her luck
in her future endeavors.
