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Exhibit 10.1
EMPLOYMENT AGREEMENT (the "Agreement") made as of August 9, 2001, by and
between NetSilicon, Inc., a Massachusetts corporation (the "Company"), and
Xxxxxxxxx Xxxxxxxx, VIII (the "Executive").
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WHEREAS, the Company wishes to secure the future services of the Executive
with the Company pursuant to the terms of this Agreement.
NOW, THEREFORE, the parties agree as follows:
1) TERM.
a) The Company hereby agrees to continue to employ the Executive and the
Executive hereby agrees to continue employment with the Company, in
the positions set forth in Section 2 below, for the Term (as defined
below), subject to the terms and conditions of this Agreement.
b) The term (the "Term") of this Agreement shall commence as of the date
hereof (the "Effective Date") and shall continue until terminated in
accordance with Section 4.
2) POSITION, DUTIES AND RESPONSIBILITIES.
a) During the Term, the Executive shall be employed by the Company and
shall serve the Company as its Chairman of the Board of Directors
("Chairman") and Chief Executive Officer ("CEO"). The Executive shall
have such duties and responsibilities as are incident to, or
reasonably requested in connection with, such positions, as well as
such other comparable duties and responsibilities as may be assigned
to him by the Company and/or the Company's Board of Directors ("BOD").
The Executive shall report to the BOD or to such comparable or higher
level of authority and responsibility within the Company as the BOD
may reasonably determine.
b) During the Term, the Executive shall serve the Company faithfully,
diligently and to the best of the Executive's ability, and shall
devote substantially all of his business time and efforts to such
service. The Executive also shall not engage in any other business
activity without the written consent of the Company, except that the
Executive may (i) carry on charitable, civic, or other not-for-profit
activities or (ii) manage his personal investments, provided that none
such activities conflict with the Executive's duties under this
Agreement and the Non-Disclosure, Proprietary Rights and
Non-Solicitation Agreement dated May 2, 2000 (the "Nondisclosure
Agreement"). If the Executive shall be elected to other offices of the
Company or any of its affiliates, and if the Executive shall in his
sole discretion accept in writing the election to such offices, he
shall serve in such positions without further compensation than
provided for in this Agreement. The Executive shall perform his
services under this Agreement at such locations as may be required by
the Company from time to time, but the Company will not require the
Executive to permanently relocate to an office more than 50 miles from
the Company's Waltham, Massachusetts office.
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c) The Executive agrees to comply with the policies and procedures of the
Company applicable to its U.S. employees generally from time to time
that are in force (which may be amended, revised or supplemented at
any time in the Company's and/or the BOD's sole discretion), provided,
however, that to the extent there is a conflict between the terms of
this Agreement and the policies and procedures of the Company, the
terms of this Agreement shall govern unless otherwise specified
herein.
3) COMPENSATION AND BENEFITS. During the term of this Agreement, the Company
shall pay the Executive as compensation for his performance of his duties
and obligations hereunder, the following:
a) BASE SALARY. During the Term, the Company shall pay to the Executive a
base salary at the rate of U.S. $20,833.33 per month ("Base Salary"),
subject to annual increase at the discretion of the BOD in accordance
with the Company's executive compensation practices, and payable in
accordance with the regular payroll practices of the Company as may be
modified or established from time to time.
b) INCENTIVE COMPENSATION. During the Term, the Executive shall be
eligible to receive additional quarterly incentive compensation (the
"Incentive Bonus"). The amount of the Incentive Bonus, if any, shall
be determined by the BOD's Compensation Committee (which may put in
place an Executive Incentive Plan), within a reasonable time after
submission of Executive's recommendations to the BOD's Compensation
Committee (the "Compensation Committee"). The Compensation Committee
may consider, among other things, the Executive's actual attainment of
specific goals as established by the BOD, and the Company's overall
performance. The BOD's Compensation Committee will make all
determinations regarding the Executive's eligibility for the quarterly
Incentive Bonus at its sole discretion. Subject to the provisions of
Section 4 herein, the Executive must be employed by the Company in
good standing (as determined by the BOD) as the Company's CEO and
Chairman to be eligible for any Incentive Bonus payments, which will
be subject to applicable taxes and payable in accordance with the
Company's normal bonus pay practices as may be established or modified
from time to time.
c) STOCK OPTIONS. The Executive has received certain stock options as
part of the Company's initial public offering, as well as additional
awards thereafter in accordance with Company option policy. The
Executive shall be eligible to receive additional stock option awards
as determined by the BOD in its sole discretion.
d) BENEFITS. Subject to any contribution therefor generally required of
senior executives of the Company, the Executive shall be eligible to
participate in all employee benefits plans, including the Company's
health and dental plans, as adopted by the BOD and in effect for
senior Company executives. Such participation shall be subject to (i)
the terms of the applicable plan documents, (ii) generally applicable
Company policies, and (iii) the discretion of the BOD or any
administrative or other committee provided for in or contemplated by
such plans.
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e) EXPENSES. The Company shall pay or reimburse the Executive for all
reasonable business expenses incurred or paid by the Executive in the
performance of his responsibilities hereunder in accordance with the
Company's prevailing policy and practice relating to reimbursements as
established, modified or amended from time to time. The Executive must
provide substantiation and documentation of these expenses to the
Company in order to receive reimbursement, as required pursuant to
Company policy.
f) VACATION. The Executive shall be entitled to accrue up to four (4)
weeks of vacation per calendar year, to be taken and paid in
accordance with Company policy.
4) TERMINATION OF EMPLOYMENT.
a) TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate the
Executive's employment and this Agreement for Cause (as defined in
Section 6(a)) upon written notice to the Executive and expiration of
any cure periods as set forth in Section 6(a). In the event of
termination for Cause, the Executive shall be entitled to no payments,
salary continuation, severance or other benefits, except for:
(i) Base Salary earned and accrued but unpaid through the date of
Executive's termination of employment;
(ii) any Incentive Bonus payment, as determined by the Compensation
Committee pursuant to Section 3(b) herein, for the quarter
previously ended prior to the Executive's termination. In
addition, in its sole discretion, the Compensation Committee may
provide an additional incentive bonus payment for the quarter in
which the Executive's termination of employment occurred;
(iii) payment for accrued but unused vacation time up to the
Executive's termination of employment;
(iv) statutory benefit continuation rights in accordance with the
Consolidated Omnibus Budget Reconciliation Act of 1985
("COBRA"), provided Executive makes the appropriate voluntary
contribution payments and subject to applicable law and the
requirements of the Company's health insurance plans then in
effect; and
(v) all expenses reimbursable to the Executive and unpaid as of the
date of Executive's termination of employment.
b) TERMINATION DUE TO DEATH OR PERMANENT DISABILITY. In the event of the
termination of the Executive's employment and this Agreement due to
the Executive's death or Disability (as defined in Section 6(c)), the
Executive, or the Executive's legal representative, shall be entitled
to no payments, salary continuation, severance or other benefits,
except for:
(i) Base Salary to the extent earned and accrued but unpaid through
the date of Executive's termination of employment, as well as a
one time lump sum cash payment equivalent to twelve (12) times
the Executive's monthly Base Salary, to be paid within a
reasonable time, not to exceed ninety (90) days, after the
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Executive's death or Disability. subject to any offset or
reduction as set forth in Section 4(b)(iv);
(ii) any Incentive Bonus payment, as determined by the Compensation
Committee pursuant to Section 3(b) herein, for the quarter
previously ended prior to the Executive's termination. In
addition, in its sole discretion, the Compensation Committee may
provide an additional incentive bonus payment for the quarter in
which the Executive's termination of employment occurred;
(iii) payment for accrued but unused vacation time up to the
Executive's termination of employment;
(iv) all benefits the Executive would otherwise receive upon a
Disability or upon death under any benefit plan covering the
Executive, PROVIDED, HOWEVER, that all such benefits that the
Executive receives or would otherwise receive upon a Disability
shall be offset against any other payments under Section 4(b)(i)
of this Section 4(b), such that any amount potentially owing to
the Executive under Section 4(b)(i) is reduced, but not less
than zero, by the monetary value of the benefits (referenced in
this subsection) received by the Executive;
(v) statutory benefit continuation rights in accordance with COBRA,
provided Executive makes the appropriate voluntary contribution
payments and subject to applicable law and the requirements of
the Company's health insurance plans then in effect;
(vi) all expenses reimbursable to the Executive and unpaid as of the
date of Executive's termination of employment; and
(vii) the Executive's unvested stock options shall vest immediately
and all of the Executive's stock options shall remain in full
force and effect and may be exercised at any time up to their
latest possible date of expiration as set out in each stock
option agreement entered into between the Executive and the
Company and applicable to such options (such option agreements
existing as of the date of this Agreement and the latest
possible date of expiration of the option contained in each such
option agreement as of the date of this Agreement are identified
in Exhibit A hereto) notwithstanding any provision contained in
any existing or future stock option agreement entered into
between the Executive and the Company (as such agreements may be
amended from time to time) or in the NetSilicon, Inc. Amended
and Restated 1998 Incentive and Non-Qualified Stock Option Plan
(as amended from time to time) or the NetSilicon, Inc. 2001
Stock Option and Incentive Plan (as amended from time to time)
that provides for either a lesser period of time within which to
exercise such options or forfeiture of any option granted
thereunder. In the event that any date of expiration contained
in any existing or future stock option agreement entered into
between the Executive and the Company shall be extended to a
later date in time, then the Executive's right to exercise
options pursuant to such stock option agreement shall be
extended to that later date in time.
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During the Term, the Company shall maintain disability insurance
policies, for which the Executive is eligible, comparable to the
insurance policies for which the other senior executives of the
Company are eligible.
c) TERMINATION WITHOUT CAUSE. In the event that the Executive's
employment and this Agreement is terminated by the Company without
Cause, the Executive shall be entitled to no payments, salary
continuation, severance or other benefits, except for:
(i) monthly severance payments in an amount equal to the Executive's
monthly Base Salary at the time of termination, for twenty-four
(24) months after the Executive's termination;
(ii) a bonus in the form of a lump sum cash payment equal to twelve
(12) times the Executive's monthly Base Salary at the rate
effective as of the Executive's last day of employment;
(iii) payment for accrued but unused vacation time up to the
Executive's termination of employment;
(iv) all expenses reimbursable to the Executive and unpaid as of the
date of Executive's termination of employment;
(v) if the Executive elects after the termination of his employment
and in accordance with COBRA to continue health coverage under
the same plans available to active Company employees, under the
same rules, restrictions and regulations applicable thereto, the
Company shall make premium payments on his behalf until the
earlier of (x) eighteen (18) months from the last day of the
Executive's employment or (y) the date on which the Executive
becomes ineligible to receive COBRA benefits;
(vi) outplacement employment services from a provider chosen by the
Company and the Executive for a period of two (2) years after
the date of termination up to an aggregate amount of $20,000;
and
(vii) the Executive's unvested stock options shall vest immediately
and all of the Executive's stock options shall remain in full
force and effect and may be exercised at any time up to their
latest possible date of expiration as set out in each stock
option agreement entered into between the Executive and the
Company and applicable to such options (such option agreements
existing as of the date of this Agreement and the latest
possible date of expiration of the option contained in each such
option agreement as of the date of this Agreement are identified
in Exhibit A hereto) notwithstanding any provision contained in
any existing or future stock option agreement entered into
between the Executive and the Company (as such agreements may be
amended from time to time) or in the NetSilicon, Inc. Amended
and Restated 1998 Incentive and Non-Qualified Stock Option Plan
(as amended from time to time) or the NetSilicon, Inc. 2001
Stock
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Option and Incentive Plan (as amended from time to time) that
provides for either a lesser period of time within which to
exercise such options or forfeiture of any option granted
thereunder. In the event that any date of expiration contained
in any existing or future stock option agreement entered into
between the Executive and the Company shall be extended to a
later date in time, then the Executive's right to exercise
options pursuant to such stock option agreement shall be
extended to that later date in time.
d) VOLUNTARY TERMINATION. The Executive may voluntarily terminate his
employment only upon sixty (60) days' written notice to the BOD
("Voluntary Termination"). In the event of a Voluntary Termination,
the Company may accelerate Executive's departure date (and terminate
this Agreement) and will have no obligation to pay Executive after his
actual departure date. In the event of a Voluntary Termination, the
Executive shall be entitled to no payments, salary continuation,
severance or other benefits, except for (i) those payments and
benefits as set forth in Section 4(a) and (ii) any of the Executive's
stock options due to vest within sixty (60) days of the Executive's
written notice of Voluntary Termination to the BOD, which shall vest
immediately.
e) TERMINATION BY THE EXECUTIVE FOR GOOD REASON. In the event the
Executive decides to terminate this Agreement and his employment for
Good Reason (as defined in Section 6(e)), the Executive must give
notice of such Good Reason to the Company and the BOD. If the basis
for such Good Reason is not cured (as determined by the BOD in good
faith) within thirty (30) days after the Company and the BOD receive
written notice specifying the basis of such Good Reason, this
Agreement, and the Executive's employment, shall terminate. In the
event of a termination by the Executive for Good Reason, the Executive
shall be entitled to the severance payments and benefits as set forth
in Section 4(c).
f) TERMINATION BY THE EXECUTIVE BY QUALIFIED RETIREMENT. The Executive
may terminate his employment as CEO, or as both CEO and Chairman, in
the event that the following eligibility criteria for retirement are
met: (i) the Executive attains the age of 62; (ii) the Executive
provides six (6) months' prior written notice to the BOD of his
intention to retire and the effective date of such retirement; (iii)
the Executive proposes a successor CEO for the Company; (iv) the BOD
selects and approves a successor CEO; and (v) a successor CEO accepts
such appointment ("Qualified Retirement"). The Company and/or BOD may
accelerate the Executive's effective date of Qualified Retirement. In
the event of a Qualified Retirement, the Company will have no
obligation to pay Executive after his effective date of retirement,
except as set forth in Subsections 1, 2 and 3 of this Section 4(f).
1. QUALIFIED RETIREMENT AS CEO AND CHAIRMAN. In the event the
Executive terminates his employment as CEO and Chairman by virtue
of a Qualified Retirement, the Executive shall be entitled to no
payments, salary continuation, severance or other benefits,
except for:
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(i) a bonus in the form of a lump sum cash payment equal to
twelve (12) times the Executive's monthly Base Salary at
the rate effective as of the Executive's last day of
employment;
(ii) the Executive's unvested stock options shall vest
immediately and all of the Executive's stock options shall
remain in full force and effect and may be exercised at any
time up to their latest possible date of expiration as set
out in each stock option agreement entered into between the
Executive and the Company and applicable to such options
(such option agreements existing as of the date of this
Agreement and the latest possible date of expiration of the
option contained in each such option agreement as of the
date of this Agreement are identified in Exhibit A hereto)
notwithstanding any provision contained in any existing or
future stock option agreement entered into between the
Executive and the Company (as such agreements may be
amended from time to time) or in the NetSilicon, Inc.
Amended and Restated 1998 Incentive and Non-Qualified Stock
Option Plan (as amended from time to time) or the
NetSilicon, Inc. 2001 Stock Option and Incentive Plan (as
amended from time to time) that provides for either a
lesser period of time within which to exercise such options
or forfeiture of any option granted thereunder. In the
event that any date of expiration contained in any existing
or future stock option agreement entered into between the
Executive and the Company shall be extended to a later date
in time, then the Executive's right to exercise options
pursuant to such stock option agreement shall be extended
to that later date in time; and
(iii) when the time period in Section 4(c)(v) concludes, the
Company will provide the Executive with health and dental
insurance comparable to that provided to the Company's
executive officers, to be selected and approved by the BOD
at its sole discretion, from the date on which the time
period in Section 4(c)(v) concludes until the Executive's
death.
2. QUALIFIED RETIREMENT AS CEO; EXECUTIVE REMAINS AS CHAIRMAN. In
the event the Executive terminates his employment as CEO by
virtue of a Qualified Retirement, but chooses to remain as the
Company's Chairman, the BOD may terminate this Agreement and
establish at its sole discretion a new salary and benefits
package for the Executive, commensurate with his duties as
Chairman. In addition, the Executive will be eligible for
severance payments and benefits as set forth in Section 4(f)(1).
3. EXECUTIVE RESIGNS AS CHAIRMAN; REMAINS AS CEO. If the Executive
resigns as Chairman, but chooses to remain as the Company's CEO,
this Agreement shall remain in full force and effect except that
the reference to the position as
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Chairman of the Board in Section 2(a) of this Agreement and all
other references and provisions relating to "Chairman" in this
Agreement shall be disregarded. Upon termination of the
Executive's employment as the Company's CEO, the Executive shall
receive the severance payments and benefits, if any, in
accordance with Section 4 of this Agreement.
g) CONSULTING/TRANSITIONAL SERVICES. In the event of a Voluntary
Termination or a Qualified Retirement as CEO, the Executive agrees to
provide for a period of three (3) months, or longer if agreed to by
the Executive, transitional and/or consulting services to the Company
as may reasonably be requested by the Company's new CEO and/or the BOD
from time to time. Such transitional and/or consulting duties may
include, but not be limited to, transitioning the Executive's duties
to the Company's new CEO; assisting the Company and/or the BOD in any
Company-related litigation; and assisting the Company and/or the BOD
with any other Company-related matters that may arise from time to
time. The Company shall pay the Executive an amount equal to the Base
Salary pursuant to Section 3(a) herein for any full-time transitional
and/or consulting services (or a pro-rated portion thereof for less
than full-time transitional and/or consulting services) provided to
the Company by the Executive under this Section 4(g).
h) EXECUTION OF RELEASE OF CLAIMS. In order to receive any of the
severance payments and benefits outlined in Section 4(b), 4(c), 4(e)
or 4(f), as the case may be, the Executive must execute a
comprehensive release of all claims in favor of NetSilicon and its
officers, directors, employees, shareholders, agents and/or
representatives.
i) CESSATION OF SEVERANCE PAYMENTS AND BENEFITS. If the Board in good
faith determines that the Executive breached in any material respect
his obligations under this Agreement or the Nondisclosure Agreement,
the Company may immediately cease payment of all severance and/or
benefits described in this Agreement. This cessation of severance
and/or benefits shall be in addition to, and not as an alternative to,
any other remedies in law or in equity available to the Company,
including the right to seek specific performance or an injunction.
5) CHANGE OF CONTROL. In the event of a Change of Control, the Executive's
unvested stock options shall vest immediately and all of the Executive's
stock options shall remain in full force and effect and may be exercised at
any time up to their latest possible date of expiration as set out in each
stock option agreement entered into between the Executive and the Company
and applicable to such options (such option agreements existing as of the
date of this Agreement and the latest possible date of expiration of the
option contained in each such option agreement as of the date of this
Agreement are identified in Exhibit A hereto) notwithstanding any provision
contained in any existing or future stock option agreement entered into
between the Executive and the Company (as such agreements may be amended
from time to time) or in the NetSilicon, Inc. Amended and Restated 1998
Incentive and Non-Qualified Stock Option Plan (as amended from time to
time) or the NetSilicon, Inc. 2001 Stock Option and Incentive Plan (as
amended from time to time) that provides for either a lesser period of time
within which to exercise such options or forfeiture of any option granted
thereunder. In the event that any date of expiration contained in any
existing or future stock
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option agreement entered into between the Executive and the Company shall
be extended to a later date in time, then the Executive's right to exercise
options pursuant to such stock option agreement shall be extended to that
later date in time.
6) DEFINITIONS.
For purposes of the Agreement, the following terms shall be defined as set
forth below:
a) "Cause", which will be determined by the BOD in good faith and at its
sole discretion, is defined as:
(i) the continued failure or refusal of the Executive substantially
to perform Executive's duties and obligations to the Company
(other than any such failure resulting from the Executive's
Disability) and which is not cured within fifteen (15) days of
notice thereof from the Company;
(ii) gross negligence in the performance of the Executive's duties,
willful misfeasance in connection with the Executive's work,
dishonesty, disloyalty, or a breach of fiduciary duty by the
Executive;
(iii) the commission by the Executive of an act of fraud,
embezzlement, misappropriation of any money or other assets or
property (whether tangible or intangible), or any other illegal
conduct in connection with the Executive's performance of his
duties;
(iv) the Executive's conviction of or pleading of nolo contendere to
a felony;
(v) disregard in any material respect of the rules or policies of
the Company, which, if curable, has not been cured within
fifteen (15) days after notice thereof from the Company;
(vi) engagement by the Executive in misconduct which is injurious in
any material respect to the Company; or
(vii) the commission of an act which constitutes unfair competition
with the Company or which induces any customer of the Company to
breach a contract with the Company, or the Executive's material
breach of this Agreement, the Nondisclosure Agreement, or any
other written agreement with the Company.
b) "Change of Control" means: (i) the merger or consolidation of the
Company with or into any other corporation or entity, or the merger or
consolidation of any other corporation or entity into or with the
Company, which results in the Company or those persons who are
shareholders of the Company as of the date hereof holding less than
50% in voting power of the outstanding capital stock of the surviving
corporation; (ii) any sale or transfer in a single transaction or
series of related transactions of all or substantially all of the
Company's assets as of the transaction date (or the date of the first
transaction in a series of related transactions); (iii) a third
"person," including a "group," becomes the "beneficial owner" (as
these terms are defined in Section 13(d) of the Securities Exchange
Act of 1934, as amended) of shares of the Company having more than 50%
of the voting power of the outstanding capital stock of the Company;
or (iv) any transaction or series of related transactions in which a
third "person," including a "group" (as these
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terms are defined in Section 13(d) of the Securities Exchange Act of
1934, as amended), appoints or elects a majority of the Board of
Directors of the Company.
c) "Disability" means the Executive's inability, for a period of ninety
(90) consecutive days, to perform, with or without a reasonable
accommodation (that does not subject the Company to an undue
hardship), the essential functions of his position by reason of mental
or physical impairment.
d) "Voluntary Termination" means a termination of employment during the
Term by the Executive on the Executive's own initiative other than a
termination for death or Disability under Section 4(b) or by Qualified
Retirement under Section 4(f).
e) "Good Reason" shall mean, without the Executive's approval,
i) a material diminution, without Cause (as defined in Section
6(a)), in the material responsibilities of the Executive;
ii) Executive's permanent relocation to an office more than 50 miles
from the Company's Waltham, Massachusetts office;
iii) failure by the Company to pay any material amount due under this
Agreement within fifteen (15) days after written notice thereof
from the Executive to the Company and the BOD; or
iv) any reduction of the Executive's Base Salary or material
benefits provided to the Executive as a whole that comprises a
material reduction in his total annual compensation, unless such
reduction is applicable to other senior executives of the
Company as part of a concessionary arrangement between those
executives and the Company and/or Board.
7) NONCOMPETITION AND NONSOLICITATION. As a condition of this Agreement, and in
consideration for the payments set forth herein, the Executive agrees that,
during the period of his employment by the Company and its subsidiaries and for
three (3) years after the termination of his employment, regardless of the
reasons for such termination, the Executive will not, directly or indirectly,
alone or as a partner, officer, director, employee, joint venturer, lender or
stockholder of any entity (other than as a shareholder of less than 1% of stock
of a publicly traded corporation), without the prior written consent of the
Company:
a) (i) accept employment with any business that competes with the
products or services being created, developed, manufactured, marketed,
distributed or sold by the Company, (ii) engage in any business or
activity that competes with the products or services being created,
developed, manufactured, marketed, distributed or sold by the Company,
and (iii) become an officer, director of, or maintain a consulting or
other professional relationship with, any business that competes with
the products or services being created, developed, manufactured,
marketed, distributed or sold by the Company.
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b) solicit the business of any customer, investor or partner of the
Company, or induce any such customer, investor or partner to terminate
their relationship with the Company.
8) INDEMNIFICATION. The Executive shall be entitled to indemnification from the
Company to the fullest extent permitted by the Company's Articles of
Organization, By-laws, shareholder resolutions and/or applicable law.
9) ENTIRE AGREEMENT; CONFLICTS. This Agreement, the Nondisclosure Agreement, any
stock option agreement between the Executive and the Company, and all promissory
notes between the Executive and the Company, contain the entire agreement
between NetSilicon and the Executive concerning the Executive's employment by
NetSilicon and supersedes all prior agreements, understandings, discussions,
negotiations and undertakings, whether written or oral, between them with
respect to the subject matter herein, provided, however, that to the extent
there is a conflict between the terms of this Agreement and the terms of any
stock option agreement or stock option plan, the terms of this Agreement shall
govern. The Executive and the Company (except as may be required in the course
of the Company doing business) agree to keep the terms of this Agreement
strictly confidential. The Executive represents that he is not bound by any
agreement or any other existing or previous business relationship that conflicts
with, or may conflict with, the performance of his obligations hereunder or
prevent the full performance of his duties and obligations hereunder.
10) AMENDMENTS OR WAIVER. This Agreement cannot be changed, modified or amended
without the consent in writing of both the Executive and the BOD. No waiver by
either the Company or the Executive at any time of any breach by the other party
of any condition or provision of this Agreement shall be deemed a waiver of a
similar or dissimilar condition or provision at the same or at any prior or
subsequent time. Any waiver must be in writing and signed by the Executive, an
authorized officer of the Company (other than the Executive), and the BOD.
11) SEVERABILITY. In the event that any provision or portion of this Agreement,
the Nondisclosure Agreement or the other agreements executed in connection with
the transactions contemplated hereby for any reason shall be determined to be
invalid or unenforceable for any reason, in whole or in part, such provisions
will be reformed to the extent possible so as to effectuate the intent of this
Agreement. In addition, the remaining provisions of this Agreement or such other
agreements shall be unaffected thereby and shall be construed, reformed and thus
remain in full force and effect to the fullest extent permitted by law.
12) SURVIVAL. The Executive agrees that Sections 4, 5, 6, 7, 8, 9, 10, 11, 13,
14, 15, 16 and 17, any agreements between the Executive and the Company
referenced herein, and such other provisions to the extent necessary to the
intended preservation of such rights and obligations, shall survive any
termination of this Agreement.
13) GOVERNING LAW AND JURISDICTION; ARBITRATION. This Agreement shall be
governed by and construed and interpreted in accordance with the laws of the
Commonwealth of Massachusetts without reference to principles of conflict of
laws. Any dispute, controversy or claim arising out of or in connection with
this Agreement shall be exclusively subject to arbitration before the American
Arbitration Association ("AAA") in Boston, Massachusetts, before a single
arbitrator in
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accordance with the AAA's then current Employment Arbitration Rules. Judgment
upon any arbitration award may be entered in any court of competent
jurisdiction. All parties shall cooperate in the process of arbitration for the
purpose of expediting discovery and completing the arbitration proceedings.
Nothing contained in this Section or elsewhere in this Agreement shall in any
way deprive either party of its right to obtain injunctive or other equitable
relief in a court of competent jurisdiction.
14) NOTICES; MISCELLANEOUS.
a) Any notice given to either party shall be in writing and shall be
deemed to have been given when delivered personally or sent by
certified or registered mail, postage prepaid, return receipt
requested, duly addressed to the party concerned, as follows:
If to the Company, to:
Chief Financial Officer
NetSilicon, Inc.
000 Xxxxxxxx Xxxx Xxxx, Xxxx. 000
Xxxxxxx, XX 00000
with a copy to:
Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP
000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Xx.
If to the Executive, to:
c/o Xxxxxx, Xxxxxx & Xxxxxx, LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx X. X'Xxxxxxx
b) The headings of the Sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the
meaning or construction of any provision of this Agreement.
c) This Agreement may be executed in two or more counterparts.
d) The Company shall make such deductions and withhold such amounts from
the payments and benefits made or provided to the Executive hereunder,
as may be required from time to time by applicable law, governmental
regulation or order.
15) ASSIGNMENT; SUCCESSORS. The Company may assign this Agreement. This
Agreement is personal in its nature and therefore the Executive cannot assign
this Agreement without the consent of the BOD. This Agreement will inure to the
benefit of the Company's or the
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Executive's successors and assigns, and such successor or assign shall discharge
and perform all the promises, covenants, duties and obligations of the Company
hereunder, and all references herein to "NetSilicon" or "Company" shall refer to
such successor.
16) WITHHOLDING.
a) Any payments made to the Executive pursuant to this Agreement
(including without limitation the acceleration of options pursuant to this
Agreement) shall be subject to all applicable federal, state and local taxes
and/or withholding.
b) If the Company in its discretion determines that it is obligated to
withhold any tax in connection with any payment under this Agreement, or in
connection with the acceleration of any option pursuant to this Agreement, the
Executive hereby agrees that the Company may withhold from any amounts paid, or
to be paid, under this Agreement, including the Executive's wages or other
remuneration, the appropriate amount of such tax (as permitted under applicable
law). The Executive further agrees that, if the Company does not withhold an
amount from the Executive's wages or other remuneration (including any
remuneration paid pursuant to this Agreement) sufficient to satisfy the
withholding obligation of the Company, the Executive will make reimbursement on
demand, in cash, for the amount underwithheld.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date first above written as an instrument under seal.
THE COMPANY EXECUTIVE
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxxxx Xxxxxxxx, VIII
------------------------------------ ---------------------------------
Signature
Title: Chairman, Compensation Committee
--------------------------------- ---------------------------------
Street Address
By: /s/ F. Xxxxx Xxxxxxx
--------------------------------------- ---------------------------------
City State Zip Code
Title: Compensation Committee Member
---------------------------------------
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Exhibit A
To
Employment Agreement
Between
NetSilicon, Inc, and Xxxxxxxxx Xxxxxxxx, VIII
Stock Option Agreements between NetSilicon, Inc. and Xxxxxxxxx Xxxxxxxx, VIII
Grant ID Agreement Date Expiration Date
-------------------------------------------------------------------------
0078 September 15, 1999 September 15, 2009
0079 September 15, 1999 September 15, 2009
0320 May 11, 2000 May 11, 2010
0321 May 11, 2000 May 11, 2010
00524 December 11, 2000 December 11, 2010
