EXHIBIT 10.9
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") dated as of March 27, 2000
by and between Western Multiplex Corporation, a Delaware corporation (the
"Company") and Xxxxxx X. Xxxxxxxxx (the "Executive").
WHEREAS, the Company considers it essential to its best interests
and the best interests of its stockholders to xxxxxx the continued employment
of Executive by the Company during the term of this Agreement and Executive
is willing to accept and continue Executive's employment on the terms
hereinafter set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein and for other good and valuable consideration, the parties
agree as follows:
1. Term of Employment; Executive Representation.
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a. Employment Term. Executive's term of employment under
this Agreement shall commence on the date hereof and, subject to the terms
hereof, Executive and the Company agree and acknowledge that Executive's
employment with the Company constitutes "at-will" employment and that this
Agreement may be terminated at any time by the Company or Executive, subject
to the provisions of Section 7 of this Agreement.
b. Executive Representation. Executive hereby represents to
the Company that the execution and delivery of this Agreement by Executive
and the Company and the performance by Executive of the Executive's duties
hereunder shall not constitute a breach of, or otherwise contravene, the
terms of any employment agreement or other agreement or policy to which
Executive is a party or otherwise bound.
2. Position.
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a. While employed hereunder, Executive shall serve as the
Company's Vice President of Access Products. In such position, Executive
shall have such duties and authority as shall be determined from time to time
by the Company. Executive shall report to the Company's President (or other
position that is equivalent or more senior).
b. While employed hereunder, Executive will devote
Executive's full business time and best efforts to the performance of
Executive's duties hereunder and will not engage in any other business,
profession or occupation for compensation or otherwise which would conflict
with the rendition of such services either directly or indirectly, without
the prior written consent of the Company; provided that nothing herein shall
preclude Executive from continuing to serve on the board of directors or
trustees of any business corporation or any charitable organization on which
he currently serves and which is identified on Exhibit A hereto or, subject
to the prior approval of the Company, from accepting appointment to any
additional directorships or trusteeships, provided in each case, and in the
aggregate, that such activities do not interfere with the performance of
Executive's duties hereunder or conflict with Section 8.
3. Annual Compensation.
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a. Base Salary. While employed hereunder, the Company shall
pay Executive a base salary (the "Base Salary") at the annual rate of
$144,000, payable in regular installments in accordance with the Company's
usual payment practices. The Company shall review Executive's Base Salary at
least annually, and Executive shall be entitled to such increases in
Executive's Base Salary, if any, as may be determined from time to time in
the sole discretion of the Company.
b. Annual Bonus. With respect to each calendar year while
employed hereunder, Executive shall be eligible to earn an annual bonus award
(an "Annual Bonus") pursuant to an annual incentive plan to be established by
the Company (the "Bonus Plan"); provided, however, that the Executive's
minimum Annual Bonus opportunity shall be based on a minimum percentage of
Base Salary (the "Minimum Target"), which shall not be less than such minimum
percentage of base salary that other similarly situated employees of the
Company may be eligible to earn pursuant to the Bonus Plan; and provided,
further, that with respect to the Annual Bonus payable in respect of calendar
year 2000, Executive's Minimum Target shall not be less than 15% of
Executive's Base Salary, and his Annual Bonus shall not be less than 22.5% of
Executive's Base Salary. A copy of the Company's existing annual incentive
plan is attached as Exhibit B hereto.
4. Equity Arrangements.
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a. Restricted Stock. The Company shall sell to Executive
200,000 shares of the Company's Common Stock. The price per share shall be
$0.50 and shall be paid by a promissory note provided by the Company (which
shall be at the minimum interest rate allowed by the Internal Revenue Service
and the interest on promissory note shall accrue). The stock purchase shall
be subject to the terms of the Subscription and Employee Stockholder's
Agreement attached as Exhibit C hereto, the terms of which shall be
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consistent with this Agreement and with such terms as may be provided to
other similarly situated executives of the Company.
b. Stock Option. The Company shall provide Executive with
an option to purchase 200,000 shares of the Company's common stock. The
exercise price per share shall be $.50 and the vesting schedule (and all
other terms) shall be as set forth in the Stock Option Agreement attached as
Exhibit D hereto, which terms shall be consistent with this Agreement.
5. Employee Benefits. The Company shall provide Executive during
the term of his employment hereunder with coverage under all employee pension
and welfare benefit programs, plans and practices in accordance with the
terms thereof, which the Company generally makes available to its senior
executives. Executive shall also be entitled to such number of paid vacation
(which shall not be less than four weeks) and sick leave in each calendar
year as established under the Company's policies as in effect from time to
time, which shall be taken at such times as are consistent with Executive's
responsibilities hereunder.
6. Business Expenses. Executive is authorized to incur
reasonable expenses in carrying out his duties and responsibilities under
this Agreement, including, without limitation, expenses for travel and
similar items related to such duties and responsibilities. The Company will
reimburse Executive for all such expenses upon presentation by Executive from
time to time of appropriately itemized and approved (consistent with the
Company's policy) accounts of such expenditures.
7. Termination. The Executive's employment hereunder may be
terminated by either party at any time and for any reason; provided that
Executive will be required to give the Company at least 90 days advance
written notice of Executive's resignation from employment with the Company
for any reason (other than for death or Permanent Disability); provided,
further, however, that Executive shall only be required to give the Company
at least 30 days' advance written notice of Executive's resignation from
employment for Good Reason (but only as defined in Section 7(c)(ii)(x) and
(y)) following the expiration of the 30-day cure period provided to the
Company pursuant to Section 7(c)(i) of this Agreement. Notwithstanding any
other provision of this Agreement, the provisions of this Section 7 shall
exclusively govern Executive's rights upon termination of employment with the
Company and its affiliates.
a. By the Company For Cause for Cause or Resignation By the
Executive Without Good Reason.
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(i) The Executive's employment hereunder may be terminated by
the Company for Cause (as defined below) or upon 90 days prior written
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notice, by Executive without Good Reason. Notwithstanding the foregoing,
none of the events described in clauses (i) or (v) of Section 7(a)(ii) shall
constitute Cause unless the Company shall have notified Executive in writing
describing the events which constitute Cause and then only if Executive shall
have failed to cure such event within thirty (30) days after Executive's
receipt of such written notice.
(ii) For purposes of this Agreement, "Cause" shall mean (i)
the Executive's willful and continued failure to perform his or her duties
with respect to the Company or its subsidiaries after demand by his or her
superior for substantial performance is made or delivered, (ii) willful
misconduct by the Executive involving material dishonesty or breach of trust
in connection with the Executive's employment, (iii) conviction for any
felony or misdemeanor involving moral turpitude, (iv) any material breach
of the Executive's restrictive covenants as provided in Section 8 of this
Agreement, or (v) material violation of any written Company policy.
(iii) If Executive's employment is terminated by the Company
for Cause or by Executive without Good Reason, Executive shall be entitled to
receive:
(A) the Base Salary through the date of termination;
(B) any Annual Bonus earned but unpaid as of the date of
termination.
(C) reimbursement for any unreimbursed business expenses
properly incurred by Executive in accordance with Company policy
prior to the date of Executive's termination;
(D) such Employee Benefits, if any, as to which Executive may
be entitled under the employee benefit plans of the Company; and
(E) any accrued but unused vacation pay (the amounts
described in clauses (A) through (E) hereof being referred to as
the "Accrued Rights").
Following such termination of Executive's employment by the Company
for Cause, except as set forth in this Section 7(a), Executive shall have no
further rights to any compensation or any other benefits under this
Agreement.
b. Disability or Death.
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(i) The Executive's employment hereunder shall terminate upon
Executive's death and if Executive becomes physically or mentally
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incapacitated and is therefore unable for a period of six (6) consecutive
months or for an aggregate of nine (9) months in any twenty-four (24)
consecutive month period to perform Executive's duties (such incapacity is
hereinafter referred to as "Disability"). Any question as to the existence
of the Disability of Executive as to which Executive and the Company cannot
agree shall be determined in writing by a qualified independent physician
mutually acceptable to Executive and the Company. If Executive and the
Company cannot agree as to a qualified independent physician, each shall
appoint such a physician and those two physicians shall select a third who
shall make such determination in writing. The determination of Disability
made in writing to the Company and Executive shall be final and conclusive
for all purposes of the Agreement.
(ii) Upon termination of Executive's employment hereunder for
either Disability or death, Executive or Executive's estate (as the case may
be) shall be entitled to receive:
(A) the Accrued Rights; and
(B) a pro rata portion of any Annual Bonus that the Executive
would have been entitled to receive pursuant to Section 3(b) hereof
in respect of the year in which the date of Executive's termination
of employment occurs, based upon the percentage of the calendar
year that shall have elapsed through the date of Executive's
termination, payable when such Annual Bonus would have otherwise
been payable had the Executive's employment not terminated.
Following Executives termination of employment due to death or
Disability, except as set forth in this Section 7(b), Executive shall have no
further rights to any compensation or any other benefits under this
Agreement.
c. By the Company Without Cause or Resignation by Executive
for Good Reason.
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(i) The Executive's employment hereunder may be terminated by
the Company without Cause or by Executive's resignation for Good Reason.
Notwithstanding the foregoing, none of the events described in clauses (x)
or (y) of Section 7(c)(ii) shall constitute Good Reason unless Executive
shall have notified the Company in writing describing the events which
constitute Good Reason and then only if the Company shall have failed to cure
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such event within thirty (30) days after the Company's receipt of such
written notice.
(ii) For purposes of this Agreement, "Good Reason" shall
mean: (x) a reduction in the Executive's Base Salary (other than any
reduction that is proportionally the same as a general salary reduction
affecting at least the majority of salaried employees of the Company), (y) a
material and adverse reduction in the Executive's duties and
responsibilities, (z) a transfer of the Executive's primary workplace by more
than fifty (50) miles from the current workplace, other than as approved by
Executive. The Company hereby acknowledges that Executive's current
workplace shall be Petaluma, California.
(iii) If Executive's employment is terminated by the Company
without Cause (other than by reason of death or Disability) or if Executive
resigns for Good Reason, Executive shall be entitled to receive:
(A) the Accrued Rights; and
(B) a pro rata portion of any Annual Bonus that the Executive
would have been entitled to receive pursuant to Section 3(b) hereof
in respect of the year in which the date of Executive's termination
of employment occurs, based upon the percentage of the calendar
year that shall have elapsed through the date of Executive's
termination, payable when such Annual Bonus would have otherwise
been payable had the Executive's employment not terminated;
(C) subject to Executive's continued compliance with the
provisions of Section 8, continued payment of the Base Salary and
Annual Bonus until twelve (12) months after the date of such
termination; provided, that the aggregate amount described in this
clause (C) shall be reduced by the present value of any other cash
severance or termination benefits payable to Executive under any
other plans, programs or arrangements of the Company or its
affiliates; and
(D) subject to Executive's continued compliance with the
provisions of Section 8, continuation of such Employee Benefits (as
described in Section 5 hereof), if any, as to which Executive may
be entitled under the employee benefits plans of the Company until
twelve (12) months after the date of such termination.
Notwithstanding the foregoing, if Executive's resigns for Good
Reason or Executive's employment is terminated by the Company without Cause
following a reduction in Executive's Base Salary (other than any reduction
that is proportionally the same as a general salary reduction affecting at
least the majority of salaried employees of the Company), the Base Salary and
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Annual Bonus for the purpose of Section 7(c)(iii) shall be based on the Base
Salary prior to such reduction.
Following Executive's termination of employment by the Company
without Cause (other than by reason of Executive's death or Disability) or by
Executive's resignation for Good Reason, except as set forth in this Section
7(c), Executive shall have no further rights to any compensation or any other
benefits under this Agreement.
d. Notice of Termination. Any purported termination of
employment by the Company or by Executive (other than due to Executive's
death) shall be communicated by written Notice of Termination to the other
party hereto in accordance with Section 10(h) hereof. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which shall indicate
the specific termination provision in this Agreement relied upon and shall
set forth in reasonable detail the facts and circumstances claimed to provide
a basis for termination of employment under the provision so indicated.
8. Nondisclosure of Confidential Information; Non-Competition.
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a. At any time during or after Executive's employment with
the Company, Executive shall not, without the prior written consent of the
Company, use, divulge, disclose or make accessible to any other person, firm,
partnership, corporation or other entity any Confidential Information (as
hereinafter defined) pertaining to the business of the Company or any of its
subsidiaries, except (i) while employed by the Company, in the business of
and for the benefit of the Company, or (ii) when required to do so by a court
of competent jurisdiction, by any governmental agency having supervisory
authority over the business of the Company, or by any administrative body or
legislative body (including a committee thereof) with jurisdiction to order
Executive to divulge, disclose or make accessible such information. For
purposes of this Section 8(a), "Confidential Information" shall mean non-
public information concerning the financial data, strategic business plans,
and other non-public, proprietary and confidential information of the
Company, its subsidiaries, Ripplewood Holdings L.L.C. or their respective
affiliates as in existence as of the date of Executive's termination of
employment that, in any case, is not otherwise available to the public (other
than by Executive's breach of the terms hereof).
b. As Vice President of Access Products, Executive will
acquire knowledge of Confidential Information and trade secrets. Executive
acknowledges that the Confidential Information and trade secrets which the
Company has provided and will provide to him could play a significant role
were he to directly or indirectly be engaged in any business in Competition
with the Company or its subsidiaries. During the period of his employment
hereunder and for one year thereafter, Executive agrees that, without the
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prior written consent of the Company, (A) he will not, directly or
indirectly, either as principal, manager, agent, consultant, officer,
stockholder, partner, investor, lender or employee or in any other capacity,
carry on, be engaged in or have any financial interest in (other than an
ownership position of less than 5 percent in any company whose shares are
publicly traded), any business, which is in Competition (as hereinafter
defined) with the Business (as hereinafter defined) and (B) he shall not, on
his own behalf or on behalf of any person, firm or company, directly or
indirectly, solicit for employment any person who has been employed by the
Company or its subsidiaries at any time during the 12 months immediately
preceding such solicitation, in either case to the extent that Executive
would use or inevitably use Confidential Information or trade secrets or that
would otherwise constitute unfair competition.
c. For purposes of this Section 8, a business shall be
deemed to be in Competition with the Business if it is primarily engaged in
or has taken concrete steps toward engaging in the business of research and
development, designing, manufacturing, marketing, distributing, or servicing
or selling components as used in microwave radios, products and equipment,
whether in existence or in development, relating to microwave communications
(including unlicenced spread spectrum radio, licensed microwave radio,
wireless Ethernet bridge, and fixed wireless (e.g., wireless local loop,
point-to-point, point-to-multipoint)), as carried on by the Company or its
affiliates as of the date of Executive's termination of employment, in all
cities, counties, states and countries in which the business of the Company
or its affiliates is then being conducted or its products are being sold.
d. The results and proceeds of Executive's services
hereunder, including, without limitation, any works of authorship resulting
from Executive's services during Executive's employment with the Company
and/or any of the Company's affiliates and any works in progress, will be
works-made-for hire and the Company will be deemed the sole owner throughout
the universe of any and all rights of whatsoever nature therein, whether or
not now or hereafter known, existing, contemplated, recognized or developed,
with the right to use the same in perpetuity in any manner the Company
determines in its sole discretion without any further payment to Executive
whatsoever. If, for any reason, any of such results and proceeds will not
legally be a work-for-hire and/or there are any rights which do not accrue to
the Company under the preceding sentence, then Executive hereby irrevocably
assigns and agrees to assign any and all of Executive's right, title and
interest thereto, including, without limitation, any and all copyrights,
patents, trade secrets, trademarks and/or other rights of whatsoever nature
therein, whether or not now or hereafter known, existing, contemplated,
recognized or developed, to the Company, and the Company will have the right
to use the same in perpetuity throughout the universe in any manner the
Company determines without any further payment to Executive whatsoever.
Executive will, from time to time as may be requested by the Company, (i)
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during the term of Executive's employment without further consideration, and
(ii) thereafter at Executive's then current hourly rate, do any and all
things which the Company may deem useful or desirable to establish or
document the Company's exclusive ownership of any and all rights in any such
results and proceeds, including, without limitation, the execution of
appropriate copyright and/or patent applications or assignments. To the
extent Executive has any rights in the results and proceeds of Executive's
services that cannot be assigned in the manner described above, Executive
unconditionally and irrevocably waives the enforcement of such rights. This
subsection is subject to and will not be deemed to limit, restrict, or
constitute any waiver by the Company of any rights of ownership to which the
Company may be entitled by operation of law by virtue of the Company being
Executive's employer. This Section does not apply to an invention that
qualifies as a nonassignable invention under Section 2870 of the California
Labor Code, which applies to any invention for which no equipment, supplies,
facilities or Confidential Information was used, which does not (i) relate to
the business of the Company; (ii) relate to the Company's actual or
demonstrable anticipated research or development or (iii) result from any
work performed by Executive for the Company. This confirms that Executive
has been notified of his rights under Section 2870 of the California Labor
Code.
e. Executive and the Company agree that this covenant not to
compete is a reasonable covenant under the circumstances, and further agree
that if in the opinion of any court of competent jurisdiction such restraint
is not reasonable in any respect, such court shall have the right, power and
authority to excise or modify such provision or provisions of this covenant
as to the court shall appear not reasonable and to enforce the remainder of
the covenant as so amended. Executive agrees that any breach of the
covenants contained in this Section 8 would irreparably injure the Company.
Accordingly, Executive agrees that the Company may, in addition to pursuing
any other remedies it may have in law or in equity, cease making any payments
otherwise required by this Agreement and obtain an injunction against
Executive from any court having jurisdiction over the matter restraining any
further violation of this Agreement by Executive.
f. Executive agrees to sign the Company's standard
Employment, Confidential Information and Invention Agreement, which is
attached as Exhibit E; provided that this Agreement shall control over any
contrary or inconsistent terms in Exhibit E.
9. Specific Performance. Executive acknowledges and agrees that
the Company's remedies at law for a breach or threatened breach of any of the
provisions of Section 8 would be inadequate and, in recognition of this fact,
Executive agrees that, in the event of such a breach or threatened breach, in
addition to any remedies at law, the Company, without posting any bond, shall
be entitled to cease making any payments or providing any benefit otherwise
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required by this Agreement and obtain equitable relief in the form of
specific performance, temporary restraining order, temporary or permanent
injunction or any other equitable remedy which may then be available.
10. Miscellaneous.
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a. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
regard to conflicts of laws principles thereof.
b. Entire Agreement/Amendments. This Agreement contains the
entire understanding of the parties with respect to the employment of
Executive by the Company. There are no restrictions, agreements, promises,
warranties, covenants or undertakings between the parties with respect to the
subject matter herein other than those expressly set forth herein. This
Agreement may not be altered, modified, or amended except by written
instrument signed by the parties hereto. This Agreement supercedes all prior
agreements and understandings (including verbal agreements) between Executive
and the Company and/or its affiliates regarding the terms and conditions of
Executive's employment with the Company and/or its affiliates
c. No Waiver. The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be
considered a waiver of such party's rights or deprive such party of the right
thereafter to insist upon strict adherence to that term or any other term of
this Agreement.
d. Severability. In the event that any one or more of the
provisions of this Agreement shall be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions of this Agreement shall not be affected thereby.
e. Assignment. This Agreement shall not be assignable by
Executive. This Agreement may be assigned by the Company to a company which
is a successor in interest to substantially all of the business operations of
the Company. Such assignment shall become effective when the Company
notifies the Executive of such assignment or at such later date as may be
specified in such notice. Upon such assignment, the rights and obligations
of the Company hereunder shall become the rights and obligations of such
successor company, provided that any assignee expressly assumes the
obligations, rights and privileges of this Agreement.
f. Mitigation. Executive shall be required to mitigate the
amount of any payment provided for pursuant to this Agreement by seeking
other employment (which is acceptable to Executive, in his good faith
determination), taking into account the provisions of Section 8 of this
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Agreement. Anything in this Agreement to the contrary notwithstanding, in
the event that Executive provides services for pay to anyone other than the
Company or any of its affiliates from the date Executive's employment
hereunder is terminated until twelve months thereafter, the amounts paid to
Executive during such period pursuant to Section 7(c)(iii)(C) to this
Agreement shall be reduced by the amounts of salary, bonus or other
compensation earned by Executive during such period as a result of
Executive's performing such services (regardless of when such earned amounts
are actually paid to Executive).
g. Successors; Binding Agreement. This Agreement shall
inure to the benefit of and be binding upon personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devises and legatees.
h. Notice. For the purpose of this Agreement, notices and
all other communications provided for in the Agreement shall be in writing
and shall be deemed to have been duly given when delivered or mailed by
United States registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth below Agreement, or to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be
effective only upon receipt.
If to the Company:
Western Multiplex Corporation
0000 Xxxxxxxx Xxx.
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxxx
If to Executive:
To the most recent address of Executive set forth in the personnel
records of the Company.
i. Withholding Taxes. The Company may withhold from any
amounts payable under this Agreement such Federal, state and local taxes as
may be required to be withheld pursuant to any applicable law or regulation.
j. Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
k. Arbitration/Attorney's Fees. Any dispute between the
parties regarding this Agreement shall be resolved by a single arbitrator,
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who is qualified to practice law in California, in accordance with the
employment dispute resolution rules of the America Arbitration Association
then in effect. The arbitrator shall have the authority to grant any relief
available under applicable law. The arbitrator's decision shall be final and
binding on the parties and shall be the exclusive remedy for all such
disputes, except that either party may bring an action in court to compel
arbitration under this Agreement, to enforce an arbitration award in any
court having competent jurisdiction, and to obtain temporary injunctive
relief pending final judgment based on the arbitrator's award. The
arbitration shall take place in Sonoma County, California unless otherwise
agreed by the parties. In any legal action, arbitration or other proceeding
between the parties, the prevailing party shall be entitled to recover
reasonable attorneys' fees and costs.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
WESTERN MULTIPLEX CORPORATION
By: /s/Xxxx Xxxxxxxxx
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Name: Xxxx Xxxxxxxxx
Title: President
EXECUTIVE:
/s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
0000 Xxxxxxxxxx Xxxxx
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Xxxxx Xxxx, XX 00000
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Address of Executive
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