EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of September
1, 1999, by and among METRON TECHNOLOGY B.V., a limited liability company
organized under the laws of the Netherlands ("MTBV"), METRON TECHNOLOGY
CORPORATION, a California corporation ("Employer"), and XXXXXX X. XXXXX
("Executive"), a California resident.
RECITALS
MTBV is the sole shareholder of Employer and Employer desires to employ
Executive on the terms and conditions set forth herein;
Executive desires to accept such employment with Employer pursuant to the
terms and conditions of this Agreement; and
MTBV intends to reconfirm the appointment of Executive as a Managing Director
A;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
1. EFFECTIVE TIME; EMPLOYMENT AND SERVICE
1.1 EFFECTIVE TIME. This Agreement is to be effective as of September
1, 1999, (the "Effective Time") and shall continue in effect until
Executive's employment terminates pursuant to the provisions of Section 3
herein.
1.2 EMPLOYMENT WITH EMPLOYER. Employer agrees that it will employ
Executive as its President and Chief Executive Officer or in such other
capacity as determined by Employer's Officers to whom the Executive reports
or Employer's Supervisory Board of Directors. MTBV agrees that it has elected
Executive as a member of the Board of Directors of Employer.
1.3 APPOINTMENT WITH MTBV. In view of Executive's employment with
Employer, and his appointment as a Class A (or similar description) Managing
Director by resolution of the General Meeting of Shareholders of MTBV, the
parties now wish to confirm the terms and conditions of his service as a
Managing Director as provided herein. The term of Executive's appointment as
a Managing Director of MTBV shall be determined by the General Meeting of
Shareholders of MTBV. To the extent permitted under Dutch corporate law, as a
Managing Director of MTBV, Executive shall perform such duties and
responsibilities as may be determined from time to time by MTBV's General
Meeting of Shareholders or MTBV's Supervisory Board (the "MTBV Supervisory
Board"), as the case may be.
1.4 RESPONSIBILITIES FOR EMPLOYER. During the term of this Agreement,
Executive shall have such responsibilities as may be assigned to him by
Employer's Officer (or Officers) to whom the Executive reports, or Employer's
Supervisory or Managing Board of Directors. Executive's duties shall be
performed at Employer's Burlingame, California office or at such other
location as Employer and Executive mutually agree; provided, however, that,
in the
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performance of his duties, Executive shall be required to travel at such
times and to such places as Employer or MTBV may reasonably request from time
to time.
1.5 EXCLUSIVE SERVICES. Executive agrees to devote his full time,
attention and energy to performing his duties and responsibilities to
Employer and MTBV. Executive further agrees that he will not engage in any
business activity in competition with Employer or MTBV nor make preparations
to do so, and agrees not to engage in any outside employment or consulting
without written authorization from MTBV's Supervisory Board. The foregoing,
however, shall not preclude Executive from engaging in the following
activities, provided that they do not unreasonably interfere or conflict with
Executive's responsibilities to Employer and MTBV: (1) engaging in
appropriate civic, charitable or religious activities; (2) devoting a
reasonable amount of time to private investments; (3) serving on the boards
of directors of nonprofit entities; or (4) serving on the Board of Directors
of a for-profit entity with the prior written consent of Employer's Chief
Executive Officer.
2. COMPENSATION, BENEFITS AND PERQUISITES
2.1 BASE SALARY. During the period this Agreement is in effect,
Employer shall pay Executive an annual base salary of $295,000.00, less
standard deductions and withholdings. MTBV, acting through the MTBV
Supervisory Board or its Compensation Committee, as the case may be, shall
review Executive's base salary at least annually and may in its sole
discretion increase (but not decrease, unless such decrease is done on an
equitable pro-rata basis for all of Employer's executives, including its CEO)
such salary to reflect performance, appropriate industry data and other
factors. Employer and MTBV shall not be obligated to provide any such salary
increases.
2.2 BONUSES.
(a) Executive shall be entitled to participate in the annual
incentive compensation plans for MTBV's senior management pursuant to the
terms of these plans. Generally, any such compensation shall be paid out of a
pool funded by a percentage of the annual pretax income of MTBV calculated
before income taxes and performance incentive compensation. MTBV shall have
the sole discretion to change or eliminate its annual incentive compensation
plans, to determine the amount placed into the pool, to determine whether
Executive is entitled to any compensation under these plans, and to determine
the amount of any such compensation.
(b) In addition, any such compensation shall be considered earned
as of the last day of Employer's fiscal year provided that Executive has
remained employed on a full-time basis by Employer through that date.
Notwithstanding the foregoing, if Executive is terminated without Cause (as
defined in Section 3.4(a) herein), or resigns for Good Reason (as defined in
Section 3.4(b) herein) during the term of this Agreement, for the fiscal year
in which his employment terminates, Employer shall pay Executive the bonus to
which he would otherwise have been entitled had he been employed as of the
last day of such fiscal year multiplied by a fraction, the numerator of which
is the number of days elapsed in the fiscal year up to and including the date
of his termination of employment, and the denominator of which is 365.
2.
(c) In the event of Executive's death or Disability (as such term
is defined in Section 3.4(c) herein) during the term of this Agreement, for
the fiscal year in which his death or Disability occurs, Employer shall pay
Executive's estate (in the event of Executive's death) or the Executive (in
case of his Disability) the bonus to which he would otherwise have been
entitled had he been employed as of the last day of such fiscal year
multiplied by a fraction, the numerator of which is the number of days
elapsed in the fiscal year up to and including the date of his death, or, in
the case of Disability, the last day of active employment, and the
denominator of which is 365.
(d) If Executive is awarded any such compensation, it will be paid
in one lump sum as soon as practicable after the annual audit of Employer's
financial statements are complete and Employer has completed the necessary
calculations of the amounts, if any, which are due. Any such compensation
shall be subject to standard withholdings.
2.3 VACATIONS. Executive shall accrue three weeks of annual vacation
with full pay in accordance with the policies applicable to executive
employees of Employer who are located in the United States. Executive may
accrue up to a maximum of 30 days vacation, at which point further accrual
stops until accrued vacation is used, unless otherwise agreed to in writing
between Executive and Employer.
2.4 EMPLOYEE BENEFITS. Executive shall be entitled to participate in
Employer's benefits and perquisites in accordance with Employer's policies
which it now or in the future makes generally available to all of its
executives. Executive shall pay any contributions which are generally
required of its executives to receive any such benefits. Such perquisites may
include but not necessarily be limited to, use of and reimbursement for
cellular/car phone, professional organizational dues and professional
developmental seminars. It is anticipated that the MTBV Supervisory Board
will annually review Executive's benefits package and may, in its discretion,
increase (but not decrease unless such decrease is done on an equitable pro
rata basis for Employer's executives including its CEO) such perquisites.
2.5 EXPENSES. During the term of his employment hereunder, Executive
shall be entitled to receive prompt reimbursement from Employer or MTBV (in
accordance with their policies and procedures for executive employees and on
submission of written documentation of such expenses suitable to Employer or
MTBV) for all reasonable travel and other expenses incurred by Executive in
connection with his services hereunder. For airline flights of four hours or
more in duration, Executive is entitled to fly business class and be
reimbursed for such expenses. Executive will make reasonable efforts to use
frequent flyer benefits derived from business travel on Employer's behalf to
upgrade from coach class to business class when feasible. Employer reserves
the right to require Executive to fly coach class (regardless of trip length
or duration) in any quarter in which MTBV reasonably expects to report a net
loss, provided that such a requirement is generally applicable to all of
Employer's executives.
2.6 INDEMNIFICATION.
(a) Except to the extent modified below in (b), Employer, with
regard to Executive's performance of services on behalf of Employer as an
employee, officer, director, or
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agent, and MTBV as an employee, officer, director, or agent, with regard to
Executive's performance of services on behalf of MTBV, agree, to the fullest
extent authorized or permitted by MTBV's charter documents and applicable
law, to fully indemnify Executive and to hold him harmless from and against
all claims, damages, judgments, losses, liabilities, fees and expenses
incurred by him or threatened against him in connection with his performance
of services hereunder and to make advances to him for the payment of legal
fees, witness fees, expenses and costs related thereto. MTBV and Employer
also agree to pay any damages, judgments, fines and amounts paid in
settlement and any other amounts that Executive becomes legally obligated to
pay because of any claim or claims made against or by Executive in connection
with any threatened, pending or completed action, suit or proceeding to which
Employee is entitled to indemnification pursuant to the terms of this Section
2.8(a), PROVIDED, HOWEVER, Employee shall not settle any such proceeding
without the express written consent of the Supervisory Board of MTBV. MTBV
and Employer agree to use their best efforts to include Executive in the
coverage of any errors and omissions and/or directors and officers insurance
policies, if any, obtained by MTBV or Employer for officers and directors of
MTBV and Employer, respectively.
(b) The indemnification provisions of Section 2.8(a) shall not
apply with respect to the obligations of MTBV or Employer to indemnify
Executive in the following events:
- to the extent that Executive is indemnified pursuant to any
insurance purchased and maintained by or on behalf of MTBV
and/or Employer pursuant to the provisions of Section
2.8(a) of this Agreement and any resulting obligations are
actually paid on behalf of or reimbursed to Executive
pursuant to such insurance;
- on account of Executive's acts or omissions that involve
intentional misconduct or would constitute Cause under
Section 3.4(a) herein;
- on account of violations of the provisions of Section 4 of
this Agreement;
- on account of acts or omissions of Executive that Executive
believed or reasonably should have known at the time of the
act or omission to be contrary to the best interests of
MTBV and Employer or its shareholders or that involve the
absence of good faith on the part of Executive;
- with respect to any transaction from which Executive
derived an improper personal benefit;
- on account of acts or omissions that show a reckless
disregard by Executive for his duties to MTBV or Employer
or their shareholders in circumstances in which Executive
was aware, or should have been aware, in the ordinary
course of performing an
4.
officer's duties, of a risk of serious injury to MTBV,
Employer or their shareholders;
- on account of acts or omissions that constitute an
unexcused pattern of inattention that amounts to an
abdication of Executive's duties to MTBV, Employer or their
shareholders;
- on account of acts or omissions that constitute a violation
of Section 16 of the Securities and Exchange Act of 1934; or
- if indemnification is unlawful.
(c) CONTINUATION OF INDEMNITY. MTBV's and Employer's indemnity
obligations contained herein shall continue during the period Employee is a
director, officer, employee or other agent of MTBV or the Employer,
respectively (or is or was serving at the request of MTBV or Employer as a
director, officer, employee or other agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise)
and shall survive the termination of Executive's employment with Employer and
continue thereafter so long as Executive shall be subject to any possible
claim or threatened, pending or completed action, suit or proceeding, by
reason of the fact that Executive was serving in the capacity referred to
herein and to the extent he would otherwise be entitled to indemnification
pursuant to Section 2.8(a).
(d) EXPENSES. Upon request, MTBV or Employer may advance, prior to
the final disposition of any proceeding covered by this Section 2.6
(excluding any proceedings instituted by Executive or Employer under Sections
5.9 and 5.10 herein), such advance not to be unreasonably withheld or
delayed, all reasonable expenses incurred by Executive in connection with
such proceeding upon receipt of an undertaking by or on behalf of Executive
to repay said amounts if it shall be determined ultimately that Executive is
not entitled to be indemnified under the provisions of this Agreement,
applicable law, MTBV's Articles of Association or Employer's Charter
Documents, or otherwise.
3. TERMINATION OF EXECUTIVE'S EMPLOYMENT
3.1 TERMINATION OF EMPLOYMENT. Executive's employment by Employer under
this Agreement may be terminated by Employer or Executive at any time, with
or without cause. Executive's appointment as a Managing Director of MTBV may
be terminated by the General Meeting of Shareholders of MTBV as permitted by
the Articles of Association of MTBV and Netherlands law. Executive agrees to
give ninety (90) days' written notice if he intends to resign without Good
Reason.
3.2 SEVERANCE BENEFITS UPON TERMINATION BY EMPLOYER WITHOUT CAUSE, UPON
RESIGNATION BY EXECUTIVE FOR GOOD REASON OR DISABILITY. If this Agreement is:
(1) terminated by Employer without Cause; or (2) terminated by the Executive
for Good Reason; or (3) terminated by Employer as a result of Executive's
Disability; and if Executive provides the
5.
Company with a signed general release of all claims, a form of which is set
forth in Exhibit A, Employer shall provide Executive with the following
severance benefits only:
(a) Continuation of Executive's final base salary for a period of
twelve (12) months after Executive's termination date. These payments will be
made on the Company's standard payroll dates and will deduct standard
deductions and withholdings. To the extent, if any, Executive receives
disability insurance benefits during this salary continuation period,
Executive agrees to tender those payments to Employer.
(b) To the extent permitted by federal COBRA law and by Employer's
current group health insurance policies, Executive will be eligible to
continue his health insurance benefits. Employer will pay the cost of
continuing such benefits for a period of twelve (12) months after Executive's
termination date. Should Executive become eligible for such health care
benefits through another employer, any such payments under this provision
shall immediately cease. Executive agrees to notify Employer immediately if
he becomes eligible for such benefits; and
(c) In the event Executive's employment is terminated because of
his Disability, Executive also shall be entitled to receive the pro-rata
bonus as specified in Section 2.2(c) herein.
3.3 NO BENEFITS IF TERMINATED BY EMPLOYER FOR CAUSE, UPON RESIGNATION
BY EMPLOYEE WITHOUT GOOD REASON, OR UPON DEATH. If Executive's employment is
terminated for Cause by Employer, or if Executive resigns without Good
Reason, or if this Agreement is terminated by Executive's death, Executive
shall not be entitled to receive any severance benefits whatsoever, provided,
however, that in the event of Employee's death, his estate shall be entitled
to the pro-rata bonus as specified in Section 2.2(c) herein.
3.4 DEFINITIONS.
(a) DEFINITION OF "CAUSE." For purposes of this Article 3, "Cause"
shall mean the following: (i) indictment or conviction of, or a plea of nolo
contendere to, any felony or any misdemeanor involving moral turpitude; (ii)
commission of an act of fraud, theft or embezzlement of property of MTBV or
any of its subsidiaries or commission of similar acts involving dishonesty or
moral turpitude that are materially injurious to MTBV or any of its
subsidiaries; (iii) Executive's failure to devote substantially all of his
working time and efforts during normal business hours to the business of MTBV
and its subsidiaries except as otherwise permitted by this Agreement or to
comply with the covenants contained in Sections 4.1 or 4.2 of this Agreement;
(iv) knowingly providing materially misleading information concerning MTBV or
any of its subsidiaries to MTBV, the MTBV Managing Board or Supervisory
Board, its General Meeting of Shareholders, any shareholder holding 10% or
more of MTBV stock, any governmental body or regulatory agency or to any
lender or other financing source or proposed financing source of MTBV or its
subsidiaries; or (v) any other failure by Executive to substantially perform
his material duties as an employee of Employer under this Agreement or as a
Managing Director of MTBV (excluding nonperformance resulting from
Executive's disability) which failure is not cured within thirty (30) days
after written notice from the XXXX
0.
Supervisory or Managing Board, in the case of Executive's duties to MTBV, or
from the Employer, in the case of Executive's duties to Employer, specifying
the act(s) of nonperformance or within such longer period (but no longer than
sixty (60) days in any event) as is reasonably required to cure such
nonperformance.
(b) DEFINITION OF "GOOD REASON." "Good Reason" shall mean: (i) a
material adverse change in the responsibilities, authority, title or office
of Executive resulting in the substantial diminution of his position; (ii)
except for decreases made on an equitable pro rata basis for Employer's
executives located in the United States, a diminution in Employee's annual
base salary below the amount stated in Section 2.1 or as same may be
increased from time to time; (iii) except for changes made on an equitable
pro rata basis for Employer's executives located in the United States, the
failure by Employer to continue to provide Executive with benefits
substantially similar to those enjoyed by executives of Employer; (iv)
Employer's requiring of Executive to be based anywhere other than a location
which is within a 50-mile radius of the Company's existing office in
Burlingame, California; or (v) any other material breach by Employer of this
Agreement; excluding for all of these purposes an isolated, insubstantial or
inadvertent action not taken in bad faith which is remedied by Employer
promptly after notice thereof is given by Executive.
(c) DEFINITION OF "DISABILITY." "Disability" shall have the same
meaning provided in Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended, except for that section's reference to "12 months," which time
period shall instead be ninety (90) days.
3.5 MERGER, TRANSFER OF ASSETS OR DISSOLUTION. This Agreement shall not
be terminated by a voluntary or involuntary dissolution of Employer or MTBV
or the transfer of all or substantially all the stock or assets of Employer
or MTBV or the merger of Employer or MTBV with or into another entity.
4. CONFIDENTIALITY AND TRADE SECRETS
4.1 PROPRIETARY INFORMATIONS AND INVENTIONS AGREEMENT. Executive agrees
to abide by all of Employer's policies and procedures and further agrees to
sign and abide by the terms of Employer's Proprietary Information and
Inventions Agreement, attached hereto as Exhibit B.
4.2 NONSOLICITATION OBLIGATIONS. Executive agrees that for two (2)
years following the termination of his employment, he will not, either
directly or through others, solicit, attempt to solicit, or induce any
employee, consultant or independent contractor of Employer or MTBV to
terminate his or her relationship with these entities in order to become an
employee, consultant or independent contractor to or for any other person or
business entity. Executive also agrees that in order to protect MTBV and
Employer's confidential and proprietary information, for two (2) years
following the termination of his employment, he will not, either directly or
through others, render services to, contract with, or attempt to solicit
business from any principal, customer or prospective customer of Employer or
MTBV for products or services offered by Employer or MTBV at the time of
Executive's termination of employment.
7.
4.3 SCOPE OF RESTRICTIONS. If the scope of the restrictions in this
section are determined by a court of competent jurisdiction to be too broad
to permit enforcement of such restrictions to their full extent, then such
restrictions shall be construed or rewritten ("Blue-lined") so as to be
enforceable to the maximum extent permitted by law, and Executive hereby
consents, to the extent he may lawfully do so, to the judicial modification
of the scope of such restrictions in any proceeding brought to enforce them.
5. MISCELLANEOUS
5.1 AMENDMENT. This Agreement may be amended only in writing signed by
each of the parties.
5.2 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to its subject matter and supersedes all
prior agreements and understandings, oral or written, between the parties;
all prior agreements regarding the subject matter of this Agreement are
hereby terminated, including Executive's previous employment agreement.
5.3 NO ASSIGNMENT BY EXECUTIVE. Executive acknowledges that the
services to be rendered by him are unique and personal. Accordingly,
Executive may not delegate or assign any of his obligations under this
Agreement.
5.4 SUCCESSORS AND ASSIGNS. Subject to Section 5.3, the provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto, any successor to or assign of Employer or MTBV, and upon Executive's
heirs and the personal representative of Executive or Executive's estate.
5.5 NOTICES. Any notice or other communication required or permitted
hereunder shall be sufficient if given in writing, (i) by hand-delivery, (ii)
by express courier, (iii) by first class mail, certified or registered with
return receipt requested or (iv) by facsimile transmission with written
confirmation sent the same day by first class mail, certified or registered
with return receipt requested, which shall be addressed as follows (or to
such other address as a party may specify by notice duly given in accordance
with this Section 5.5):
If to Employer:
Metron Technology Corporation
0000 Xxx Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Vice President, Finance
8.
If to MTBV:
Metron Technology B.V.
c/o FSI International, Inc.
000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Chairman, Supervisory Board
of Directors
If to Executive:
Xxxxxx X. Xxxxx
0000 Xxxxxxx Xxxxxx, 0X
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Any notice so sent shall be deemed effectively made on the day of actual
delivery to the recipient (if by hand or express courier), on the fifth
business day following mailing (if by airmail) or on the next business day
following transmission (if by telefax with written confirmation).
5.6 WAIVER OF BREACH. Any waiver by either party of compliance with any
provision of this Agreement by the other party shall not operate or be
construed as a waiver of any other provision of this Agreement, or of any
subsequent breach by such party of a provision of this Agreement. No waiver
by MTBV shall be valid unless in writing and signed by the Chairman of the
MTBV Supervisory Board.
5.7 SEVERABILITY. If any one or more of the provisions (or portions
thereof) of this Agreement shall for any reason be held by a final
determination of a court of competent jurisdiction to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions (or portions of the provisions) of this
Agreement, and the invalid, illegal or unenforceable provisions shall be
deemed replaced by a provision that is valid, legal and enforceable and that
comes closest to expressing the intention of the parties hereto.
5.8 GOVERNING LAW. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of California, without giving effect to
conflict of law principles. Executive hereby expressly agrees that the
intention of the parties is that Executive will remain a resident of
California and will perform all or substantially all of his services as an
employee of Employer hereunder and as a Managing Director of MTBV in and from
the United States and not The Netherlands. Accordingly, the parties hereby
expressly exclude application of Netherlands law to this Agreement, including
in particular but without limitation all Netherlands laws regarding
employment, termination of employment and employee benefits. Executive hereby
irrevocably consents to such exclusion and waives any and all claims or
causes of action that he might otherwise assert against MTBV, its
subsidiaries, officers, directors and shareholders based on, or arising out
of, any provision of Netherlands law.
9.
5.9 DISPUTE RESOLUTION. Unless otherwise prohibited by law, all
disputes, claims, and causes of action (including but not limited to any
claims of statutory discrimination of any type), in law or equity, arising
from or relating to this Agreement or its enforcement, performance, breach,
or interpretation, or to Executive's employment with Employer or service with
MTBV, or the termination of that employment or service, shall be resolved
solely and exclusively by final, binding and confidential arbitration through
Judicial Arbitration & Mediation Services/Endispute, Inc. ("JAMS") under the
then existing JAMS employment arbitration rules. Employer shall be
responsible for paying any and all fees and costs necessary to initiate such
arbitration proceedings, subject to final apportionment by the Arbitrator.
Executive understands and agrees that this provision waives his right to a
jury trial on these claims. This arbitration shall be held in the San
Francisco Bay Area. Nothing in this section is intended to prevent either
party from obtaining injunctive relief in court to prevent irreparable harm
pending the conclusion of any such arbitration.
5.10 ATTORNEYS' FEES. In the event of litigation between Executive and
Employer arising under Section 5.9 herein, the prevailing party shall be
entitled to reimbursement from the non-prevailing party for its reasonable
attorneys' fees and costs of suit in addition to such other relief as may be
granted.
5.11 HEADINGS. The headings of articles and sections herein are
included solely for convenience and reference and shall not control the
meaning or interpretation of any of the provisions of this Agreement.
5.12 COUNTERPARTS. This Agreement may be executed by either of the
parties hereto in counterparts, each of which shall be deemed to be an
original, but all such counterparts shall constitute a single instrument.
10.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective as of the date set forth above.
METRON TECHNOLOGY B.V.
By: /s/ X.X. Xxxxxxxx
_____________________________
Xxxx Xxxxxxxx
Chairman of the Supervisory Board
METRON TECHNOLOGY CORPORATION
By: /s/ Xxxxx X. Xxxxx
_____________________________
Xxxxx X. Xxxxx
Vice President, Finance
EXECUTIVE
/s/ X. Xxxxx
_________________________________
Xxxxxx X. Xxxxx
11.
