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EXHIBIT 10.39
EMPLOYMENT AGREEMENT, DATED FEBRUARY 10, 1997,
BETWEEN THE COMPANY AND XXXXXXX XXXXXXXXX
AGREEMENT
This agreement is made between Xxxxxxx Xxxxxxxxx on behalf of himself
alone, and AG Associates, Inc., on behalf of itself, its parent companies,
affiliated companies, subsidiaries, and divisions, and the present and former
owners, directors, officers, employees, and agents of any of them ("AG").
1. AG agrees to employ Xxxxxxxxx, and Xxxxxxxxx agrees to be employed by AG, in
the position of Vice President, Finance and Chief Financial Officer on a
temporary basis. In the capacity of acting Vice President, Finance and Chief
Financial Officer, Xxxxxxxxx shall have those duties and responsibilities, and
that authority, set forth in Attachment A to this Agreement, which is attached
hereto and incorporated herein by reference.
2. This Agreement is effective February 10, 1997, and shall remain effective to
and including March 28, 1997, unless sooner terminated by either party. Both
parties have the unrestricted right to terminate this Agreement at any time,
with or without cause upon ten (10) days written notice to the other party.
3. During the term of this Agreement, Xxxxxxxxx agrees that he shall devote his
full time, attention and efforts to AG and its interests, and shall not be
employed in any capacity by any other person or entity without the express
written consent of AG.
4. AG agrees to pay Xxxxxxxxx the gross sum of Twenty-six Thousand Two Hundred
Fifty Dollars ($26,250) over the term of this Agreement, minus all applicable
federal, state, and local deductions. Said amount shall be paid in semi-monthly
installments pursuant to AG's normal payroll practices. In the event this
Agreement is terminated for any reason prior to March 28, 1997, Xxxxxxxxx shall
be owed, and AG shall pay Xxxxxxxxx, only the pro-rata portion of the contract
amount earned as of the date of termination.
5. AG will recommend to the Company's Board of Directors that Xxxxxxxxx be
granted the opportunity to purchase up to five thousand (5,000) shares of the
Company's Common Stock under our current Stock Option Plan, in the event he
remains employed to and including March 28, 1997. If granted by the Board in its
sole discretion, said option shall vest in its entirety on February 10, 1998,
and must be exercised in accordance with the AG Associates 1993 Stock Option
Plan.
6. In the event of any change in control of AG on or before February 10, 1998,
the options set forth in paragraph 5 shall vest immediately on the effective
date of the change in control. A "change in control" is defined as any person or
entity not currently holding at least a fifty-one percent (51%) interest in AG
obtaining at least a fifty-one percent (51%) interest.
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7. Xxxxxxxxx agrees that he shall not participate in or be entitled to
participate in any employee benefit, including any pension, retirement, or
savings plan, any form of health insurance, disability insurance, income
insurance, or any other benefit, and that the sole and exclusive consideration
owed Xxxxxxxxx under this Agreement is the compensation set forth in paragraph
4, and stock options set forth in paragraph 5, above.
8. Xxxxxxxxx shall be covered by AG's Directors and Officers Liability Insurance
Policy in accordance with the terms and condition of said policy, a copy of
which shall be made available for examination by Xxxxxxxxx upon Xxxxxxxxx'x
request.
9. AG agrees to indemnify Xxxxxxxxx in accordance with the terms and conditions
of the AG ASSOCIATES, INC. INDEMNIFICATION AGREEMENT executed between the
parties, a true and correct copy of which is attached hereto and incorporated
herein by reference as Attachment B.
10. The parties agree that in the event of any dispute between them arising out
of or connected with this Agreement, or otherwise arising out of or connected in
any way with Xxxxxxxxx'x employment, compensation, or termination of employment,
the sole and exclusive remedy for such dispute shall be final and binding
arbitration pursuant to the labor arbitration rules of the American Arbitration
Association conducted in Santa Xxxxx County, California.
11. THE PARTIES EXPRESSLY AGREE AND ACKNOWLEDGE THAT THEY HAVE READ AND
UNDERSTAND THIS ENTIRE AGREEMENT. THE PARTIES AGREE THAT THEY HAVE HAD ADEQUATE
OPPORTUNITY TO CONSULT WITH COUNSEL PRIOR TO SIGNING THIS AGREEMENT. THE PARTIES
AGREE THAT THE ONLY REPRESENTATIONS REGARDING THIS AGREEMENT, OR TO INDUCE ANY
PARTY TO SIGN THIS AGREEMENT, ARE CONTAINED IN THIS AGREEMENT. THE PARTIES SIGN
THIS AGREEMENT KNOWINGLY AND VOLUNTARILY.
DATED: February 10, 1997
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Xxxxxxx Xxxxxxxxx
AG ASSOCIATES, INC.
DATED: February 10, 1997 By
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Arnon Gat, Chief Executive Officer
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ATTACHMENT A
Xxxxxxx Xxxxxxxxx Agreement
February 10, 1997
- The CFO is expected to be a key contributor to the global business
activities such as strategic and business planning, the formulation and
execution of general business and quality management efforts, business
and management reviews including presentations to the Board of
Directors, and the continued development of AG Associates' presence in
the financial community.
- The CFO is responsible for all aspects of the accounting, finance,
treasury, and related administrative functions. These include the
following:
Accounting and Control -- Develop and apply sound accounting principles and
financial controls which will lead to providing timely and accurate financial
statements. Of particular importance is the development of financial reporting
that provides quality information to the functional management of the Company.
The financial information needs to meet the requirements for reporting to
various governmental agencies and investor groups, and meet the requirements for
acceptability by Certified Public Accountants auditing the Company. Cost
accounting is an area of particular visibility and working with Operations to
develop accurate cost identification and analysis along with efficient inventory
management will be an important task. This aspect of the position includes the
management of the Audit function and the CPA relationship.
Financial Planning and Analysis -- Review the financial planning and budgeting
framework, and lead the yearly budget planning process within the Company, as
well as arrange for a regular analysis of budget-to-actual performance within a
relevant departmental review process. This also will include the development of
a range of analytical tools and reports to support business decision making
within the Company, again with the emphasis on team solutions. Of particular
importance here is the enhancement of the business decision-making process
within the Company through visibility into financial ramifications and proactive
work with management to help achieve objectives.
Treasury -- Continue to develop and implement efficient cash management
strategies as well as the operational aspects of cash forecasting and
monitoring. In addition, the CFO is responsible for negotiating and securing
favorable Company credit lines and banking relationships, and for insuring
covenant compliance. You will provide leadership on all Company financing
initiatives. This could include international financing to support offshore
activities as well.
Management Information Systems -- Identify and implement Company-wide
information systems appropriate to support the future growth of the business. Of
particular importance is the optimization of system linkages to provide a highly
integrated approach to management, thus insuring the timely and accurate
information for analysis and business decision making.
Legal -- Interface with legal counsel and assume responsibility for all legal
issues, with the exception of labor/human resource-related issues, including
patents, litigation, contracts, etc., with a focus on successful and cost
effective results.
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External Relationships -- The CFO's involvement in the Company's external
relationships will be critical to the growth and development of our business.
You will be responsible for leading many aspects of these activities as a
knowledgeable and capable spokesperson for the business and a full participant
in various outside financial and business relationships for the Company. These
relationships include dealing with governmental agencies; bank and other debt
sources; equity investors; the financial community in the larger context -- Wall
Street, investment banks, technical analysts; customers, vendors, joint venture
partners; Certified Public Accounting firms; and legal and contractual parties.
Your leadership or active participation in contractual negotiations such as
licenses and joint ventures are a critical element of this position, as the
Company needs to have all its senior executives take a highly contributory role
in the growth of the business.
