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Exhibit 9
CHANGE IN CONTROL AGREEMENT
AGREEMENT, made as of this 2nd day of December, 1999, by and between
Microwave Power Devices, Inc., a Delaware corporation (the "Company"), and
Xxxxxx Xxxxx, the Chairman of the Board, President and Chief Executive Officer
of the Company (the "Executive").
WITNESSETH:
WHEREAS, the Company believes that the establishment and maintenance of a
sound and vital management of the Company is essential to the protection and
enhancement of the interests of the Company and its stockholders;
WHEREAS, the Company also recognizes that the possibility of a Change in
Control of the Company (as defined in Section 1 hereof), with the attendant
uncertainties and risks, might result in the departure or distraction of key
employees of the Company to the detriment of the Company; and
WHEREAS, the Company has determined that it is appropriate to take steps to
induce key employees to remain with the Company, and to reinforce and encourage
their continued attention and dedication, when faced with the possibility of a
Change in Control of the Company.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto hereby agree as follows:
1. Change in Control Definition. A Change in Control shall mean the
occurrence of any of the following: (i) any person (as defined in Section
3(a)(9) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and as used in Sections 13(d) and 14(d)
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thereof), excluding the Company, any Affiliates (as hereinafter defined) of the
Company, or any employee benefit plan sponsored or maintained by the Company or
its Affiliates (including any trustee of any such plan acting in his capacity as
trustee), becoming the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act) of securities of the Company representing more than fifty percent
(50%) of the total combined voting power of the Company's then outstanding
securities; (ii) the merger, consolidation or other business combination of the
Company (a "Transaction"), other than a Transaction involving only the Company's
Affiliates or a Transaction immediately following which the stockholders of the
Company immediately prior to the Transaction continue to have a majority of the
voting power in the resulting entity; (iii) during any period of three (3)
consecutive years beginning on or after the date hereof, the persons who were
members of the Board of Directors of the Company (the "Board") immediately
before the beginning of such period (the "Incumbent Directors") ceasing (for any
reason other than death) to constitute at least a majority of the Board or the
board of directors of any successor to the Company, provided that, any director
who was not a director as of the date hereof shall be deemed to be an Incumbent
Director if such director was elected to the board of directors by, or on the
recommendation of or with the approval of, at least two-thirds of the directors
who then qualified as Incumbent Directors either actually or by prior operation
of the foregoing unless such election, recommendation or approval occurs as a
result of an actual or threatened election contest (as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act or any
successor provision) or other actual or threatened solicitation of proxies or
contests by or on behalf of a person other than a member of the Board; or (iv)
the approval by the stockholders of the Company of any plan of complete
liquidation of the Company or an agreement for the sale of all or substantially
all of the Company's assets, other than the sale of all or substantially all of
the
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assets of the Company to any of the Company's Affiliates. Only one Change in
Control may occur under this Agreement. For purposes of this Agreement, the term
"Affiliates" shall have the same meaning as set forth under the definition of
"affiliates" in Rule 405 of the Securities Act of 1933, as amended.
2. Term. This Agreement shall commence on the date hereof and shall expire
on the earlier of (i) three (3) years from the date hereof, or (ii) the date of
the death of the Executive, or (iii) the termination of the Executive's
employment with the Company (for any reason) prior to a Change of Control.
3. Effect of a Change in Control. If a Change in Control occurs
simultaneous with or prior to the expiration of this Agreement pursuant to
Section 2 hereof, then the Executive shall be entitled to the amounts and
benefits provided under Section 4 hereof regardless of whether or not, upon or
after a Change of Control, the Executive continues to be employed with the
Company. In the event the Executive continues to be employed with the Company
upon or after a Change in Control, any and all amounts and benefits provided to
the Executive under Section 4 hereof shall be in addition to, and not in lieu
of, any and all salary, amounts and benefits that Executive receives from the
Company in respect of such continued employment.
4. Payments upon a Change in Control. If pursuant to Section 3 above, the
Executive is entitled to amounts and benefits under this Section 4, the Company
shall pay or provide, as the case may be, the following items:
(a) within five (5) business days following a Change of Control, the
Company shall pay to the Executive in a lump sum an amount equal to two (2)
times the sum of (i) the
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Executive's then current annual salary plus (ii) the Executive's then current
annual targeted bonus pursuant to the terms of that certain Executive Incentive
Bonus Plan of the Company (as such plan may be modified from time to time.)
(b) upon the occurrence of a Change in Control, all outstanding stock
options granted by the Company to the Executive under the Company's stock option
plans (collectively, the "Plan") shall immediately vest and be exercisable
notwithstanding any provisions of the Plan to the contrary.
(c) within five (5) business days (or at such earlier time as required by
applicable law) following his termination of employment with the Company, the
Company shall pay to the Executive in a lump sum: (i) any earned but unpaid base
salary, (ii) any earned but unpaid bonus, (iii) accrued but unused vacation time
as of the date of termination, and (iv) incurred but unreimbursed business
expenses for the period prior to termination.
(d) for a period of twenty-four (24) months commencing on the date of the
Change of Control, subject to the Executive's continued copayment of premiums
which shall not exceed the level of copayments prior to such Change of Control,
the Company shall continue to pay the premiums to provide health benefits and
coverage for the Executive and his dependents under the Company's health plans
in effect prior to such Change of Control which cover senior executives. The
Company's obligation to pay premiums hereunder shall cease upon the Executive's
employment with any employer (other than due to self-employment) following a
Change of Control. Upon the expiration of such twenty-four (24) month period,
the Company shall offer COBRA continuation health coverage to the Executive and
his dependents in accordance with applicable law.
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5. No Duty to Mitigate/Set-off; Terminate Employment Agreement;
Severance. If pursuant to Section 4 hereof the Executive is entitled to payment,
the Executive will not be required to seek other employment or to attempt in any
way to reduce any amounts payable to the Executive by the Company pursuant to
this Agreement. Further, the amounts and benefits provided for in this Agreement
shall not be reduced by any compensation earned by the Executive or benefits
provided to the Executive as the result of employment by another employer or
otherwise. Notwithstanding anything herein to the contrary, if pursuant to
Section 4 hereof the Executive is entitled to payment: (i) the Executive's
Employment Agreement with the Company shall immediately terminate and the
Executive shall not be entitled to any payment with respect to such Employment
Agreement and (ii) the payment pursuant to Section 4 hereof shall be in lieu of
any other severance payments to which Executive may be entitled pursuant to any
severance plan of the Company or otherwise.
6. Successors; Binding Agreement. In addition to any obligations
imposed by law upon any successor to the Company, the Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to expressly assume and agree in writing to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it. This Agreement shall inure to the benefit of and be enforceable by
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the [***] while any
amount would still be payable to the Executive hereunder if the Executive had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to the executors,
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personal representatives or administrators of the Executive's estate. This
Agreement is personal to the Executive and neither this Agreement or any rights
hereunder may be assigned by the Executive.
7. Miscellaneous. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and such officer as may be specifically
designated by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or
provision shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. This Agreement
constitutes the entire Agreement between the parties hereto pertaining to the
subject matter hereof. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not expressly set forth in this Agreement. All
references to any law shall be deemed also to refer to any successor provisions
to such laws. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which together will
constitute one and the same instrument. If any provisions of this Agreement
shall be declared to be invalid or unenforceable, in whole or in part, such
invalidity or unenforceability shall not affect the remaining provisions hereof
which shall remain in full force and effect.
8. Notices. All notices under this Agreement shall be given in writing
and shall be either delivered personally or sent by certified or registered
mail, return [***] addressed to the other party at the appropriate address
first set forth above, or to such other address as such party shall designate
by written notice as aforesaid. Notices shall be deemed given when received or
two (2) days after mailing, whichever is earlier.
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9. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit,
bonus, incentive, equity or other plan or program provided by the Company and
for which the Executive may qualify. Amounts that are vested benefits or which
the Executive is otherwise entitled to receive under any plan or program of the
Company, at or subsequent to the date of termination shall be payable in
accordance with such plan or program, except as otherwise specifically provided
herein.
10. Not an Agreement of Employment. This is not an agreement assuring
employment and, subject to any other agreement between the Executive and the
Company, the Company reserves the right to terminate the Executive's employment
at any time with or without cause.
11. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without reference to rules
relating to conflicts of law.
IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.
MICROWAVE POWER DEVICES, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Controller
/s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
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