EXHIBIT 10.9
COMPENSATION DEFERRAL AGREEMENT
This Compensation Deferral Agreement, dated as of December 30, 2004, is
by and between XXXXXX MICRO INC., a Delaware corporation (the "Company"), and
XXXXX XXXXX ("Executive").
1. DEFERRAL OF BASE SALARY. During and in respect of the period commencing on
January 1, 2005 and ending on December 31, 2005 (the "Compensation Period"),
Executive elects to defer receipt of 5.0% of the base salary otherwise payable
to him (the "Deferred Salary"). The Deferred Salary, with earnings thereon
calculated pursuant to Section 4 hereof, shall be paid to Executive as provided
in Section 5 hereof.
2. DEFERRAL OF ANNUAL BONUS. Executive elects not to defer any amount
otherwise payable to Executive pursuant to the Company's Executive Incentive
Award Plan with respect to the Compensation Period.
3. ADJUSTMENT TO DEFERRED SALARY. During the Compensation Period, the amount
of Deferred Salary shall be increased by the "Company Match", which is the
amount of Executive's base salary which the Company would have contributed to
the Xxxxxx Micro 401(k) Investment Savings Plan or the Xxxxxx Micro Supplemental
Investment Savings Plan if Executive had elected to contribute at least 5% of
his base salary to such plans. The Company Match, with earnings thereon
calculated pursuant to Section 4 hereof, shall be paid to Executive as provided
in Section 5 hereof.
4. EARNINGS. Subject to Section 6 hereof, the Deferred Salary and Company
Match shall be increased or decreased, as the case may be, by the imputed
earnings or losses which would have accrued to such amounts had they been
deferred pursuant to the Xxxxxx Micro Supplemental Investment Savings Plan from
the dates payment or credit would, but for this Agreement, be made, to the most
recent date prior to the date of actual payment practicable to permit the
calculations of the amount due to be made and payment to be processed
("Earnings"). For purposes of determining Earnings, Executive may choose in the
manner designated by the Company from time to time, and in such proportions as
he may determine (provided that the allocations shall be in 5% increments),
among any or all of the investment options provided by the Xxxxxx Micro
Supplemental Investment Savings Plan.
5. PAYMENT OF DEFERRED SALARY. Subject to Section 6 hereof, the Deferred
Salary, Company Match and Earnings thereon shall be paid to Executive in
accordance with the most recent Executive Deferred Compensation Distribution and
Investment Election Form on file with the Company, provided that the date of the
said form is at least one year prior the distribution date. The Company shall
withhold from such payment all federal, state, city or other taxes as are
legally required to be withheld.
6. SOURCE OF PAYMENTS. The obligations of the Company under this Agreement
represents an unsecured, unfunded promise to pay benefits to Executive and/or
Executive's beneficiaries, and shall not entitle Executive or such beneficiaries
to a preferential claim to any asset of the Company. All payments of Deferred
Salary, Company match and Earnings shall be paid in cash from the general funds
of the Company no special or separate fund shall be established and no other
segregation of
assets shall be made to assure the payment of such deferred amounts. Executive
shall have no right, title, or interest whatever in or to any investments which
the Company may make to aid it in meeting its obligation hereunder. Nothing
contained in this Agreement, and no action taken pursuant to its provisions,
shall create or be construed to create a trust of any kind or a fiduciary
relationship between the Company and Executive or any other person. To the
extent Executive has or acquires any rights to receive payments from the
Company, such rights shall be no greater than the right of an unsecured
creditor.
7. NEW COMPANY COMPENSATION DEFERRAL PLAN. Notwithstanding Section 4 or 5
hereof, in the event that the Company adopts a plan pursuant to which executives
of the Company my elect to defer payment of compensation, the determination of
Earnings and the terms and conditions of payment of Deferred Salary and Deferred
Bonuses Shall be governed by and subject to the terms and conditions of such
plan.
8. GENERAL PROVISIONS. The Agreement shall be binding upon and inure to the
benefit of the Company and its successors and assigns, and Executive, his
designees, and his estate. Neither Executive, his designees, nor his estate
shall commute, pledge, encumber, sell or otherwise dispose of the right to
receive the payments provided for in this Agreement, which payments and the
rights thereto are expressly declared to be nontransferable and nonassignable.
This Agreement shall be governed by the laws of the State of California without
reference to principles of conflicts of laws. This Agreement represents the
entire agreement between Executive and the Company with respect to the subject
matter hereof, and this Agreement may not be amended or modified except by a
writing signed by the parties hereto, provided that nothing herein shall affect
Executive's rights under, or right to become covered by, any employee benefit
program provided by the Company to its executive employees generally.
IN WITNESS WHEREOF, the parties have executed this Agreement, to be
effective as of the day and year first written above.
XXXXX XXXXX XXXXXX MICRO INC.
/s/ Xxxxx Xxxxx Dec. 30/04 By: /s/ Xxxxxx Xxxxx
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Date Title: Sr. Dir. Compensation & Benefits
Date: 12-30-04
