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Exhibit 8
MICROWAVE POWER DEVICES, INC.
00 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
As of December 2, 1999
Mr. Xxxxxx Xxxxx
c/o Microwave Power Devices, Inc.
00 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Dear Xx. Xxxxx:
Microwave Power Devices, Inc., a Delaware corporation (the "Company"),
hereby agrees to employ you and you hereby agree to accept such employment under
the following terms and conditions:
1. TERM OF EMPLOYMENT.
(a) Except for earlier termination as provided in Section
9 below, your employment under this Agreement shall be for an initial term
commencing on the date hereof (the "Effective Date") and terminating on December
31, 2002 (the "Initial Term"),
(b) After the Initial Term, this Agreement shall be
automatically renewed for successive renewal terms of one year each, unless
prior to the end of any such renewal term either party shall have given to the
other party at least 90 days' prior written notice of its intention not to renew
this Agreement.
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2. COMPENSATION.
(a) You shall be compensated for all services rendered by
you under this Agreement at the rate of $300,000 per annum (such salary, as it
may from time to time be increased, is hereinafter referred to as the "Base
Salary"), payable in such manner as is consistent with the Company's payroll
practices for executive employees. Prior to each anniversary of the Effective
Date, the Board of Directors shall review your performance, the earnings of the
Company during the prior year and the Company's economic prospects for the
coming year and shall consider in its sole discretion whether to increase the
Base Salary payable to you hereunder.
(b) With respect to the Company's fiscal year ending
December 31, 2000, and with respect to each subsequent fiscal year of the
Company during the term of this Agreement, you shall be eligible to receive an
incentive bonus in accordance with the terms of the Company's Executive
Incentive Bonus Plan, if any, adopted by the Compensation Committee of the Board
of Directors with respect to such fiscal year.
(c) As of the date hereof you have been granted stock
options to purchase up to 300,000 shares of the Company's Common Stock at an
exercise price of $7.00 per share pursuant to the Company's 1999 Stock Option
Plan. You shall also be eligible for future stock option grants as determined by
the Compensation Committee of the Board of Directors.
3. DUTIES.
(a) You shall serve as the Chairman of the Board,
President and Chief Executive Officer of the Company, subject to the direction
and control of the Board of Directors
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of the Company. You shall also be a member of the Board of Directors of the
Company. Your principal office shall be located in the vicinity of Long Island,
New York.
(b) You shall devote such of your business time, energies
and attention to the business and affairs of the Company and its subsidiaries as
may be reasonably required to enable you to fulfill the responsibilities of
Chief Executive Officer of the Company.
(c) You shall, except as otherwise provided herein, be
subject to the Company's rules, practices and policies applicable to the
Company's senior executive employees.
4. BENEFITS. You shall be entitled to such benefits, if any, as
are generally provided by the Company to its senior executive employees
including, without limitation, personal leave, sick leave, and holiday leave to
the extent such leaves are provided to all senior executive employees. You also
shall have the benefit of any life and medical insurance plans, pensions and
other similar plans as the Company may have or may establish from time to time
for its senior executive employees. The foregoing, however, shall not be
construed to require the Company to establish any such plans or to prevent the
Company from modifying or terminating any such plans, and no such action or
failure thereof shall affect this Agreement. In addition, you shall be entitled
to twenty work days' paid vacation per year. The Company shall also provide you
with the use of a luxury automobile and $5,000 per year for personal tax and
financial planning services.
5. [***] The Company will reimburse you for reasonable expenses,
including travel expenses, incurred by you in connection with the business of
the Company upon the presentation by you of appropriate substantiation for such
expenses.
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6. RESTRICTIVE COVENANTS.
(a) During such time as you shall be employed by the
Company, and for a period of two years thereafter, you shall not, without the
written consent of the Board of Directors, directly or indirectly become
associated with, render services to invest in, represent, advise or otherwise
participate as an officer, employee, director, stockholder, partner, agent of or
consultant for, any business which is conducted in any of the jurisdictions in
which the Company's business is conducted and which is competitive with the
business in which the Company is engaged at the time your employment with the
Company ceases; provided, however, that: (1) nothing herein shall prevent you
from acquiring up to 3% of the securities of any company listed on a national
securities exchange or quoted on the NASDAQ quotation system, provided your
involvement with any such company is solely that of a stockholder; and (2) if
your employment hereunder shall be terminated by the Company without Just Cause
(as defined below) therefor having been given by you, then the foregoing
noncompetition agreement shall, at the election of the Company, be effective for
a period of up to two years after such termination provided the Company shall
pay you during such period at a per annum rate equal to your Base Salary in
effect at the time of such termination. In the event the Company is making
payments to you pursuant to clause (2) of the immediately preceding sentence,
the Company shall have the right to terminate such payments at any time upon 30
days' prior written notice to you, in which event the foregoing noncompetition
agreement shall terminate on the 30th day following your receipt of such notice.
(b) The parties hereto intend that the covenant contained
in this Section 6 shall be deemed a series of separate covenants for each
country, state, county and city in
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which the Company's business is conducted. If, in any judicial proceeding, a
court shall refuse to enforce all the separate covenants deemed included in this
Section 6 because, taken together, they cover too extensive a geographic area,
the parties intend that those of such covenants (taken in order of the
countries, states, counties and cities therein which are least populous) which
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 of this Section 6.
7. CONFIDENTIALITY, NON-INTERFERENCE AND PROPRIETARY INFORMATION.
(a) CONFIDENTIALITY. In the course of your employment by
the Company hereunder, you will have access to confidential or proprietary data
or information of the Company and its operations. You will not at any time
divulge or communicate to any person nor shall you direct any Company employee
to divulge or communicate to any person (other than to a person bound by
confidentiality obligations similar to those contained herein and other than as
necessary in performing your duties hereunder) or use to the detriment of the
Company or for the benefit of any other person, any of such data or information.
The provisions of this Section 7(a) shall survive your employment hereunder,
whether by the normal expiration thereof or otherwise. The term "confidential or
proprietary data or information" as used in this Agreement shall mean
information not generally available to the public including, without limitation,
personnel information, financial information, customer lists, supplier lists,
trade secrets, information regarding operations, systems, services, knowhow,
computer and any other processed or collated data, computer programs, pricing,
marketing and advertising data.
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(b) NON-INTERFERENCE. You agree that you will not at any
time after the termination of your employment by the Company, for your own
account or for the account of any other person, tortiously interfere with the
Company's relationship with any of its suppliers, customers or employees.
(c) PROPRIETARY INFORMATION AND DISCLOSURE. You agree
that you will at all times promptly disclose to the Company (which, for the
purposes of this Section 7, shall include the Company and any subsidiaries and
affiliates of the Company), in such form and manner as the Company may
reasonably require, any inventions, improvements or procedural or methodological
innovations, programs methods, forms, systems, services, designs, marketing
ideas, products or processes (whether or not capable of being trade-marked,
copyrighted or patented) conceived or developed or created by you during or in
connection with your employment hereunder and which relate to the business of
the Company and any subsidiaries or affiliates ("Intellectual Property"). You
agree that all such Intellectual Property shall be the sole property of the
Company. You further agree that you will execute such instruments and perform
such acts as may reasonably be requested by the Company to transfer to and
perfect in the Company all legally protectible rights in such Intellectual
Property.
(d) RETURN OF PROPERTY. All written materials, records
and documents made by you or coming into your possession during your employment
concerning any products, processes or equipment, manufactured, used, developed,
investigated or considered by the Company or otherwise concerning the business
or affairs of the Company, shall be the sole property of the Company, and upon
termination of your employment, or upon request of the Company during your
employment, you shall promptly deliver same to the Company. In addition, upon
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termination of your employment, or upon request of the Company during your
employment, you will deliver to the Company all other Company property in your
possession or under your control, including, but not limited to, financial
statements, marketing and sales data, patent applications, drawings and other
documents, and all Company credit cards and automobiles.
8. EQUITABLE RELIEF. With respect to the covenants contained in
Sections 6 and 7 of this Agreement, you agree that any remedy at law for any
breach of said covenants may be inadequate and that the Company shall be
entitled to specific performance or any other mode of injunctive and/or other
equitable relief to enforce its rights hereunder or any other relief a court
might award.
9. EARLIER TERMINATION. Your employment hereunder shall terminate
prior to the expiration of the Initial Term (or any renewal term, in the event
of renewal) on the following terms and conditions:
(a) This Agreement shall terminate automatically on the
date of your death.
(b) This Agreement shall be terminated if you are unable
to perform your duties hereunder for 90 days (whether or not continuous) during
any period of 360 consecutive days by reason of physical or mental disability.
The disability shall be deemed to have occurred on the 90th day of your absence
or lack of adequate performance.
(c) This Agreement shall terminate immediately upon the
Company's sending you written notice terminating your employment hereunder for
"Just Cause," which shall mean (i) an act or acts of fraud or dishonesty by you
which results in the personal enrichment of
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you or another person or entity at the expense of the Company; (ii) your
admission, confession or conviction of (X) any felony (other than third degree
vehicular infractions), or (Y) of any other crime or offense involving misuse or
misappropriation of money or other property; (iii) your continued material
breach of any obligations under this Agreement 30 days after the Company has
given you notice thereof in reasonable detail, if such breach has not been cured
by you during such period; or (iv) your gross negligence or willful misconduct
with respect to your duties or gross misfeasance of office.
(d) This Agreement shall terminate immediately upon the
Company's sending you written notice terminating your employment hereunder
(without Just Cause therefor having been given by you) for any reason or for no
reason. In the event of any termination of this Agreement pursuant to this
Section 9(d), or in the event the Company gives you notice pursuant to Section
1(b) of its intention not to renew this Agreement, the Company's sole obligation
to you shall be (i) to pay you one year's worth of Base Salary in effect as of
the date of termination of your employment hereunder, (ii) to pay you the
amount, if any, you would have been entitled to receive pursuant to Section 2(b)
of this Agreement with respect to the fiscal year of the Company in which your
employment was terminated and (iii) to continue for one year the benefits
provided in the second sentence and in the last sentence of Section 4 of this
Agreement. The amounts payable pursuant to clauses (i) and (ii) of the
immediately preceding sentence shall be paid to you as and when such amounts
would have been due had your employment continued. In addition, in the event of
the termination of this Agreement pursuant to this Section 9(d), or in the event
the Company gives you notice pursuant to Section 1(b) of its intention not to
renew this Agreement, you shall be credited with one year's additional vesting
for all stock options then held by you.
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Compensation under this Section 9(d) shall not be payable in the event you
receive compensation under Section 4 of the Change of Control Agreement.
(e) Except as specifically set forth in Section 9(d)
above, upon termination or non-renewal of this Agreement, the Company's
obligations hereunder shall cease.
10. CHANGE OF CONTROL. You shall be entitled to the payments and
benefits provided in (i) the Change of Control Agreement attached hereto as
Exhibit A (the "Change of Control Agreement") and (ii) the Parachute Gross Up
Agreement attached hereto as Exhibit B.
11. REPRESENTATION AND WARRANTY. The execution, delivery and per-
formance of this Agreement by you will not conflict with or result in a
violation of any agreement to which you are a party or any law, regulation or
court order applicable to you.
12. ENTIRE AGREEMENT; MODIFICATION. This Agreement constitutes the
full and complete understanding of the parties with respect to your employment
arrangements. No representations, inducements, promises, agreements or
understandings, oral or otherwise, have been made by either party to this
Agreement, or anyone acting on behalf of either party, which are not set forth
herein, and any others are specifically waived. This Agreement may not be
modified or amended except by an instrument in writing signed by the party
against which enforcement thereof may be sought.
13. SEVERABILITY [***] or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining
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terms and provisions of this Agreement or affecting the validity or
enforceability of any of the terms or provisions of this Agreement in any other
jurisdiction.
14. WAIVER OF BREACH. The waiver of either party of a breach of
any provision of this Agreement, which waiver must be in writing to be
effective, shall not operate as or be construed as a waiver of any subsequent
breach.
15. NOTICES. All notices hereunder shall be in writing and shall
be sent by express mail or by certified or registered mail, postage prepaid,
return receipt requested, if to you, to your residence as listed in the
Company's records, and if to the Company, to its address set forth at the head
of this Agreement, attention of Secretary with a copy to Proskauer Rose LLP,
0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of Xxxxxxx X. Xxxxx, Esq.
16. ASSIGNABILITY; BINDING EFFECT. This Agreement shall not be
assignable by you without the written consent of the Board of Directors of the
Company. This Agreement shall be binding upon and inure to the benefit of you,
your legal representatives, heirs and distributees, and shall be binding upon
and inure to the benefit of the Company, its successors and assigns.
17. GOVERNING LAW. All questions pertaining to the validity,
construction, execution and performance of this Agreement shall be construed and
governed in accordance with the laws of the State of New York, without regard to
the conflicts or choice of law provisions thereof.
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18. HEADINGS. The headings of this Agreement are intended solely
for convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
19. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
20. DISPUTES. In the event of any dispute under this Agreement,
the nonprevailing party shall pay all legal fees and expenses of the prevailing
party.
If this letter correctly sets forth our understanding, please sign the
duplicate original in the space provided below and return it to the Company,
whereupon this shall constitute the employment agreement between you and the
Company effective and for the term as stated herein.
MICROWAVE POWER DEVICES, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
Controller
Agreed as of the date
first above written:
/s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
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