EMPLOYMENT AGREEMENT
AGREEMENT dated as of December, 16, 1996 between CIDCO Incorporated, a Delaware
corporation (the "Company"), and Xxxx Xxxx (the "Employee").
WHEREAS, the Employee has been hired as a key
employee of the Company; and
WHEREAS, the Company is engaged in a highly
technical and competitive business.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and
for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
1. Employment and Term.
The Company hereby agrees to employ the Employee during the period commencing as
of the date hereof and continuing until this Agreement is terminated pursuant to
the terms hereof, to serve as the Company's Vice President Finance &
Administration and CFO in such other executive managerial position or positions
with the Company or its subsidiaries or affiliates as shall hereafter be
designated by the Board of Directors of the Company, to perform such managerial
duties consistent with the usual duties of an officer of his status. Such
employment shall, except as otherwise stated herein, be on the same terms and
conditions as Employee is currently employed by the Company. The Employee hereby
accepts such employment and agrees to devote his full business time exclusively
to the faithful and diligent performance of the duties provided herein and
agrees in connection with the performance of such duties to act in a manner
consistent with the primary objective of maximizing the profitability of the
Company.
2. Compensation.
(a)Salary. The Company shall compensate the Employee with a base salary
of at least $160,000 (representing the Employee's base salary for 1996), subject
to annual review by the Company's Compensation Committee, with a minimum annual
increase in 1997 and subsequent years to reflect the percentage increase in the
cost of living during the preceding year as reflected in the All Items Consumer
Price Index for all urban consumers in the San Francisco-Oakland-San Jose,
California area as published by the United States Bureau of Labor Statistics.
Payment shall be made in 26 installments.
(b)Benefits. The Employee shall be entitled to participate in such
pension plans, 401(k) plans, group health, accident or life insurance plans,
group medical and hospitalization plans, stock option plans, stock purchase
plans and other similar benefits, as may hereafter be available to the
executives of the Company. It is understood that, except as set forth herein,
the Company does not by reason of this Agreement obligate itself to make such
benefits available to its employees.
(c)Expenses. The Company shall pay or reimburse the Employee for all
expenses normally reimbursed by the Company and reasonably incurred by him in
furtherance of his duties hereunder including, without limitation, expenses for
traveling, meals, hotel accommodations and the like upon submission by him of
vouchers or an itemized list thereof prepared in compliance with such rules
relating thereto as the Board may, from time to time, adopt and as may be
required in order to permit such payments as proper deductions to the Company
under the Internal Revenue Code of 1986, as amended, and the rules and
regulations adopted pursuant thereto now or hereafter in effect.
(d)Vacations. During each year of employment (including the current year
ending December 31, 1996), the Employee shall be entitled to paid vacations for
an aggregate of the greater of (A) two weeks, or (B) such period as may be
provided from time to time in the Company's vacation policy. The Company shall
not pay the Employee any additional compensation for any vacation time not used
by the Employee.
(e)Bonuses. In addition to the foregoing, Employee may also receive
bonuses in such amounts, at such times and upon such terms as the Board may in
its sole discretion, without any obligation to do so, determine and award.
3. Termination.
(a) This Agreement shall be terminated upon the happening of any of the
following events: (i) whenever the Company or the Employee shall give written
notice terminating this Agreement; (ii) upon the death of the Employee; or (iii)
upon the Permanent Disability (as such term is defined in Section 3(d) hereof)
of the Employee.
(b) In the event that the Employee's employment with the Company is
terminated by the Company without Cause (as defined in Section 3(c) hereof) or
is terminated by the Employee for Good Reason (as defined in Section 3(e)
hereof), then for a period of six months following the date his employment is so
terminated, the Employee shall continue to receive the full amount of his then
current base salary, plus any cost of living increase granted to him by the
Company through the date of such termination of employment, plus all other
benefits to which the Employee is entitled pursuant to Section 2(b) hereof
(including, without limitation, continuation of the Employee's participation in
the Company's pension, 401(k) plan, insurance, medical, stock option, stock
purchase and other benefit plans as if the Employee's employment continued
throughout such six month period), provided, however, that if during such six
month period the Employee obtains reasonably comparable employment with another
employer, then the Employee's continuing base salary payments hereunder shall
cease upon the date of commencement of such comparable employment (but the
Employee's right to continued participation in Company benefits shall
nevertheless continue until the end of such six month period).
(c) For purposes hereof, "Cause" shall mean any of the following: (i)
the intentional failure, neglect or refusal of the employee to substantially
fulfill his material duties as an employee; (ii) a material breach of any
fiduciary duty or other material dishonesty by the employee with respect to the
Company or any affiliate thereof resulting in actual material harm to the
Company or such affiliate; or (iii) the conviction of the employee for a
fraudulent act or felony.
(d) For purposes hereof, "Permanent Disability" shall mean the total
incapacitation of the Employee so as to preclude performance of the duties of
his employment hereunder for an aggregate period of four months in any twelve
month period.
(e) For purposes hereof, "Good Reason" shall exist if the company shall:
(i) be in breach of or default under any material provision of this Agreement
and not cure such breach within 30 days of receiving notice of such breach from
the Employee; (ii) change the principal work location of the Employee without
the consent of the Employee, which consent may be withheld by the Employee for
any reason; (iii) materially change the duties of the Employee without the
Employee's consent, which consent may be withheld by the Employee for any
reason; (iv) reduce the Employee's base salary or benefits without the
Employee's consent, which consent may be withheld by the Employee for any
reason; or (v) become insolvent or bankrupt or file a voluntary or involuntary
petition in bankruptcy or make an assignment for the benefit of creditors or
consent to the appointment of a trustee or receiver.
4. Noncompetition and Nonintervention.
(a) While in the employ of the Company, the Employee agrees to devote
substantially all of his entire time, attention and energies to the performance
of the business of the Company and the Employee shall not, directly or
indirectly, alone or as a member of any partnership or other business
organization, or as a partner, officer, director, employee, stockholder,
consultant or agent of any other corporation, partnership or other business
organization, be actively engaged in or concerned with any other duties or
pursuits which interfere with the performance of his duties as an Employee of
the Company, or which, even if noninterfering, may be contrary to the best
interests of the Company.
(b) For a period of one year after the termination or cessation of the
Employee's employment with the Company for any reason (including termination of
employment by the Company without Cause), the Employee shall not, directly or
indirectly, alone or as a member of any partnership or other business
organization, or as a partner, officer, director, employee, stockholder,
consultant or agent of any corporation, partnership or business organization,
engage in any business activity which is directly or indirectly in competition
with the products or services being developed, manufactured, marketed, provided
or sold by the Company or which is directly or indirectly detrimental to the
business of the Company. For a period of eighteen months after the termination
or cessation of the Employee's employment with the Company for any reason
(including termination of employment by the Company without Cause) the Employee
shall not, directly or indirectly, alone or as a member of any partnership or
other business organization, or as a partner, officer, director, employee,
stockholder, consultant or agent of any corporation, partnership or business
organization (i) request or cause any customer of the Company to cancel or
terminate any business relationship with the Company, or (ii) solicit or
otherwise cause any employee of the Company to terminate such employee's
relationship with the Company. For the purposes of this Section 4(b), a business
shall be deemed to be in competition with the Company only if the products or
services of such business are substantially similar in function or capability to
the products or services then being developed, manufactured, marketed, provided
or sold by the Company, and are marketed to substantially the same type of user
as that to which the products and services of the Company are marketed or
proposed to be marketed.
5. Confidential Information.
(a) The Employee will not at any time, whether during or after the
termination or cessation of his employment, reveal to any person, association or
company any of the trade secrets or confidential information concerning the
organization, business or finances of the Company so far as they have come or
may come to his knowledge, except as may be required in the ordinary course of
performing his duties as an employee of the Company or except as may be in the
public domain through no fault of the Employee, and the Employee shall keep
secret all matters entrusted to him and shall not use or attempt to use any such
information in any manner which may injure or cause loss or may be calculated to
injure or cause loss whether directly or indirectly to the Company.
(b) The Employee agrees that during his employment he shall not make,
use or permit to be used any notes, memoranda, drawings, specifications,
programs, data or other materials of any nature relating to any matter within
the scope of the business of the Company or concerning any of its dealings or
affairs otherwise than for the benefit of the Company. The Employee shall not,
after the termination or cessation of his employment, use or permit to be used
any such notes, memoranda, drawings, specifications, programs, data or other
materials, it being agreed that any of the foregoing shall be and remain the
sole and exclusive property of the Company and that immediately upon the
termination or cessation of his employment the Employee shall deliver all of the
foregoing, and all copies thereof, to the Company, at its main office.
6. Patent and Copyright Assignment.
The Employee agrees to assign and transfer to the Company or its designee,
without any separate remuneration or compensation, his entire right, title and
interest in and to all Inventions and Works in the Field (as hereinafter
defined), together with all United States and foreign rights with respect
thereto, and at the Company's expenses to execute and deliver all appropriate
patent and copyright applications for securing United States and foreign patents
and copyrights on such Inventions and Works, and to perform all lawful acts,
including giving testimony, and to execute and deliver all such instruments,
that may be necessary or proper to vest all such Inventions and Works in the
Field and patents and copyrights with respect thereto in the Company, and to
assist the Company in the prosecution or defense of any interference which may
be declared involving any said patent applications or patents or copyright
applications or copyrights. For the purposes of this Agreement, the words
"Inventions and Works" shall include any discovery, process, design,
development, improvement, application, technique, program or invention, whether
practice or not, conceived or made by the Employee, individually or jointly with
others (whether on or off the Company's premises or during or after normal
working hours), on or after July 15, 1996 while in the employ of the Company,
provided, however, that no discovery, process, design, development, improvement,
application, technique, program or invention reduced to practice or conceived by
the Employee off the Company's premises and after normal working hours shall be
deemed to be included in the term "Inventions and Works" unless directly or
indirectly related to the business then being conducted by the Company or any
business which the Company is then actively exploring (collectively, the
"Field").
7. Binding Effect.
This Agreement shall inure to the benefit of and shall be binding upon the
parties hereto and the Company's successors or assigns (whether resulting from
any reorganization, consolidation or merger of the Company or any business to
which all or substantially all of the assets of the Company are sold) and the
Employee's heirs, executors and legal representatives.
8. Entire Agreement.
This Agreement contains the entire agreement and understanding of the parties
with respect to the subject matter hereof, supersedes all prior agreements and
understandings with respect thereto and cannot be modified, amended, waived or
terminated, in whole or in part, except in writing signed by the party to be
charged.
9. Right to Injunction.
The Employee acknowledges and agrees that the services rendered and to be
rendered to the Company by him are of a specialized and unique character and
that irreparable and immediate damage will result to the Company if Employee
fails to, refuses to or neglects to perform his agreements and obligations
hereunder. In the event of such a failure, refusal or neglect by the Employee,
the Company shall be entitled to injunctive relief or any other legal or
equitable remedies including the recovery, by appropriate action, of the amount
of the actual damage caused by the Company by any such failure, refusal or
neglect by the Employee. The remedies provided in this Agreement shall be deemed
cumulative and the exercise of one shall not preclude the exercise of any other
remedy at law or in equity for the same event or any other event.
10. Miscellaneous.
(a)Amendments. No amendment, modification or waiver of any of the terms
of this Agreement shall be valid unless made in writing and signed by the
Employee and the Company.
(b)Successors in Interest. All provisions of this Agreement shall
survive the termination or cessation of the Employee's employment with the
Company and shall be binding upon and inure to the benefit of and be enforceable
by and against the respective heirs, executors, administrators, personal
representatives, successors and assigns of either of the parties to this
agreement.
(c)Waiver. The waiver by the Company of a breach of this Agreement by
the Employee shall not operate or be construed as a waiver of any subsequent
breach by the Employee.
(d)Severability. If any provision of this Agreement shall contravene any
law or any particular state where the Employee shall perform services for the
Company, then this Agreement shall be first construed to be limited in scope and
duration so as to be enforceable in that state, and if still unenforceable,
shall then be construed as if such provision is not contained herein.
(e)Governing Law. This Agreement shall be governed by the laws of the
State of New York without regard to the conflict of laws principles thereof.
(f)Counterparts. This Agreement may be executed in two or more
counterparts, and by each party on separate counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as
of the date first above written.
CIDCO INCORPORATED
By: /s/Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
President and CEO
/s/Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
