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EXHIBIT 10.6
CIRRUS LOGIC, INC.
EMPLOYMENT AGREEMENT
This Agreement is entered into effective as of April 25, 2001, (the
"Effective Date") by and between Cirrus Logic, Inc., a Delaware corporation (the
"Company") and Xxxxx Xxxxxx (the "Employee").
WHEREAS, the Company desires to employ the Employee on a full-time
basis in the capacity of President and Chief Executive Officer of the Company,
and the Employee desires to accept such employment; and
WHEREAS, the parties desire and agree to enter into an employment
relationship by means of this Agreement;
NOW THEREFORE in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is mutually covenanted and
agreed by and among the parties as follows:
1. POSITION AND DUTIES. The Employee shall be employed as President
and Chief Executive Officer of the Company, reporting to the
Company's Board of Directors and assuming and discharging such
responsibilities as are commensurate with the Employee's position.
In performing his basic duties, the Employee shall work at the
Company's principal business office located in Austin, Texas. The
Employee acknowledges that frequent travel will be necessary in
carrying out his duties hereunder. The Employee shall perform his
duties faithfully and to the best of his ability and shall devote
his full business time and effort to the performance of his duties
hereunder.
2. COMPENSATION.
(a) BASE SALARY. For all services to be rendered by the
Employee to the Company while this Agreement is in
effect, the Employee shall receive an annual base
salary equal to $450,000 (the "Base Salary"), payable
bi-weekly in accordance with the Company's normal
payroll practices.
(b) EXECUTIVE VARIABLE COMPENSATION PROGRAM. The Employee
shall be eligible to participate in the Company's
Executive Variable Compensation Program ("VCP"). The
Employee's target payout under the VCP shall be one
hundred percent (100%) of his Base Salary.
(c) RESTRICTED STOCK. The outstanding $750,000 loan
secured by Employee's 90,000 shares of the Company's
common stock will become due and payable 180 days
following the Employee's termination of employment
with the Company for any reason.
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(d) RELOCATION: MOVING EXPENSES. Upon termination of the
Employee's employment with the Company for any
reason, the unpaid principal amount of the
outstanding $721,899 relocation loan shall bear
interest at the then "applicable federal rate" (as
defined in Section 1274(d) of the Internal Revenue
Code (or any successor provision). The relocation
loan will become due and payable 180 days following
the Employee's termination of employment with the
Company for any reason.
(e) TERMINATION BY REASON OF DEATH OR DISABILITY. In the
event of Employee's death during the term of this
Agreement, the Company shall pay the Employee's
estate all salary, bonuses and unpaid vacation
accrued as of the date of Employee's death and any
other benefits payable under the Company's then
existing benefit plans and policies in accordance
with such plans and policies in effect on the date of
death and in accordance with applicable law. In the
event that, during the term of this Agreement,
Employee is unable to perform his job due to death or
disability (as determined under the Company's
long-term disability insurance program) for six
months in any 12-month period, the Company may, at
its option, terminate the Employee's employment with
the Company, pursuant to Section 5 below, and such
termination shall entitle the Employee to all salary,
bonuses and unpaid vacation accrued as of the date of
such termination and any other benefits payable under
the Company's then existing benefit plans and
policies in accordance with such plans and policies
in effect on the date of such termination and in
accordance with applicable law. Notwithstanding
Section 2(d) above, in the event Employee's
employment is terminated as a result of his death or
disability, the Company will forgive his relocation
loan, subject to his or his estate's prompt payment
to the Company of any applicable income and
withholding taxes.
3. OTHER BENEFITS. The Employee and his legal dependents shall be
entitled to participate in the employee benefit plans and programs
of the Company, if any, to the extent that his position, tenure,
salary, age health and other qualifications make the Employee and
his legal dependents eligible to participate in such plans or
programs, subject to the rules and regulations applicable thereto.
The Company reserves the right to cancel or change the benefit
plans and programs it offers to its employees at any time. Employee
will be eligible for vacation and sick leave in accordance with the
policies in effect during the term of this Agreement and will
receive such other benefits as the Company generally provides to
its other employee of comparable position and experience.
4. EXPENSES. The Company shall reimburse the Employee for reasonable
travel, entertainment or other expenses incurred by the Employee in
the furtherance of or in connection with the performance of the
Employee's duties hereunder, in accordance with the Company's
expense reimbursement policy as in effect from time to time.
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5. TERMINATION. In the event (i) the Company terminates the Employee's
employment on or before the first anniversary of the Effective Date
other than for Cause, or (ii) any successor to the Company fails or
refuses to assume this Agreement in accordance with Section 7
below, the Employee shall the be entitled to receive a single,
lump-sum severance payment within fifteen (15) days of termination
equal to the Employee's then current annual base salary. In
addition, the Company shall pay to the Employee a lump-sum payment
in an amount equivalent to the reasonably estimated costs the
Employee may incur to extend for a period of twelve (12) months
under the COBRA continuation laws the Employee's group health and
dental plans coverage in effect on the date of such termination. In
addition, in such event the Employee will vest fully in all of his
outstanding stock options, which will remain exercisable for a
180-day period following such termination. For purposes of this
Agreement, the term "Cause" shall mean (i) gross negligence or
willful misconduct in the performance of duties to the Company
after one written warning detailing the concerns and offering the
Employee opportunities to cure; (ii) material and willful violation
of any federal or state law; (iii) commission of any act of fraud
with respect to the Company; (iv) conviction of a felony or any
crime causing material harm to the standing and reputation of the
Company; or (v) intentional and improper disclosure of the
Company's confidential or proprietary information. For purposes of
this Agreement, the determination of Cause shall be determined by
the Board in its sole and absolute discretion.
6. RIGHT OF ADVICE OF COUNSEL. The Employee acknowledges that he has
consulted with counsel and is fully aware of his rights and
obligations under this Agreement and of the tax consequences
thereof.
7. SUCCESSORS.
(a) COMPANY'S SUCCESSORS. Any successor to the Company
(whether direct or indirect and whether by purchase,
lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of the
Company's business and/or assets shall assume the
obligations under this Agreement and agree expressly
to perform the obligations under this Agreement in
the same manner and to the same extent as the Company
would be required to perform such obligations in the
absence of a succession. For all purposes under the
Agreement, the term "Company", shall include any
successor to the Company's business and/or assets
which executes and delivers the assumption agreement
described in this subsection (a) or which becomes
bound by the terms of this Agreement by operation of
law.
(b) EMPLOYEE'S SUCCESSORS. Without the written consent of
the Company, the Employee shall not assign or
transfer this Agreement or any right or obligation
under this Agreement to any other person or entity.
Notwithstanding the foregoing, the terms of this
Agreement and all rights of the Employee hereunder
shall inure to the benefit of, and be enforceable by,
the Employee's personal or legal representatives,
executors, administrators, successors, heirs
distributees, devisees and legatees.
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8. NOTICE CLAUSE.
(a) MANNER. Any notice hereby required or permitted to be
given shall be sufficiently given if in writing and
upon mailing by registered or certified mail, postage
prepaid, to either party at the address of such party
or such other address as shall have been designated
by written notice by such party to other party.
(b) EFFECTIVENESS. Any notice of other communication
required or permitted to be given under this
Agreement will be deemed given on the day when
delivered in person, or the third business day after
the day on which such notice was mailed in accordance
with Section 8(a).
9. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal substantive laws, but not the choice
of law rules, of the State of Texas.
10. SEVERABILITY. The invalidity or unenforceability of any provision
of this Agreement, or any terms hereof, shall not affect the
validity or enforceability of any other provision or term of this
Agreement.
11. INTEGRATION. Except as otherwise expressly provided other wise
herein, this Agreement represents the entire agreement and
understanding between the parties as to the subject matter herein
and supersedes all prior or contemporaneous agreements, whether
written or oral. No waiver, alteration, or modification of any of
the provisions of this Agreement shall be binding unless in writing
and signed by duly authorized representatives of the parties
hereto.
12. TAXES. All payments made pursuant to this Agreement shall be
subject to withholding of applicable income and employment taxes.
13. INDEMNIFICATION. In the event Employee is made, or threatened to be
made, a party to any legal action or proceeding, whether civil or
criminal, by reason of the fact that Employee is or was a director
or officer of the Company or serves or served any other corporation
fifty percent (50%) or more owned or controlled by the Company in
any capacity at the Company's request, Employee shall be
indemnified by the Company, and the Company shall pay Employee's
related expenses when and as incurred, all to the fullest extent
permitted by law.
14. ARBITRATION. Except for proceedings seeking injunctive relief,
including, without limitation, allegations of misappropriation of
trade secrets, copyright or patent infringements, or breach of any
anti-competition provisions of the Agreement, any controversy or
claim arising out of or in relation to this Agreement, or the
breach thereof, shall be settled by arbitration in accordance with
the commercial arbitration rules of the American Arbitration
Association ("AAA"), and judgement upon the
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award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. Arbitration of this Agreement shall include
all claims, regardless of whether the dispute arises during the
term of the Agreement, at the time of termination or thereafter.
Either party may initiate the arbitration proceedings, for which
the provision is herein made, by notifying the opposing party, in
writing, of its demand to arbitrate. In any such arbitration there
shall be appointed one arbitrator who shall be selected in
accordance with the AAA Commercial Arbitration Rules. The place of
arbitration shall be Austin, Texas. The parties agree that the
award of the arbitrator shall be the sole and exclusive remedy
between them regarding any claims, counterclaims, issues or
accountings presented or plead to the arbitrator; that the
arbitrator shall be the final judge of both law and fact in
arbitration of disputes arising out of or relating to this
Agreement, including the interpretation of the terms of this
Agreement. The parties further agree it shall be the sole and
exclusive duty of the arbitrator to determine the arbitrability of
issues in dispute and that neither party shall have recourse to the
court of such a determination.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by a duly authorized officer, as of the day and
year first above written.
CIRRUS LOGIC, INC.
By: /s/ XXXXXX X. XXXXXX
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Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President, Human
Resources, General Counsel and
Secretary
XXXXX XXXXXX
/s/ XXXXX XXXXXX
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