Exhibit 10.29
EMPLOYMENT AGREEMENT
November 10, 1997
CONFIDENTIAL
Xxxxxxx X. Xxxxxx
c/o Avid Technology, Inc.
Metropolitan Technology Park
Xxx Xxxx Xxxx
Xxxxxxxxx, XX 00000
Dear Xxxx:
Continuity of management of Avid Technology, Inc. ("Avid") is a critical
factor to the continued growth and success of Avid. The Avid Board of Directors
believes that it is in the best interest of the Company to reinforce and
encourage the continued attention and dedication of key members of management to
their assigned duties.
In consideration of the mutual promises contained in this letter, it is
hereby agreed that Avid shall provide to you, and that you shall receive from
Avid, the benefits set forth in this letter (the "Agreement") if your employment
with Avid, and its subsidiaries, is terminated during the term of this
Agreement.
1. PURPOSE
This Agreement establishes certain special arrangements relating to the
termination of your employment with Avid for any reason other than: (i)
your becoming totally and permanently disabled under the Avid long-term
disability plan or policy, or (ii) your death.
2. TERM OF AGREEMENT
This Agreement shall become effective on the date hereof (the "Effective
Date") and shall terminate one year thereafter. The term shall be
automatically extended for successive one-year periods after the first
anniversary, unless 30 days' advance written notice is given by you or by
Avid terminating this Agreement as of any anniversary date.
3. TERMINATION OF EMPLOYMENT
Your employment may be terminated in accordance with any of the following
paragraphs, but only upon one (1) month's advance written notice (which
period shall be referred to in this Agreement as the "Notice Period"). The
expiration of the Notice Period shall be your "Date of Termination."
(a) INVOLUNTARY TERMINATION WITHOUT CAUSE. Avid may terminate your
employment without Cause (as defined below). In such an event, you shall
continue to receive your full base salary during the Notice Period. Upon
your Date of Termination, you shall be entitled to those benefits provided
under Section 4.
(b) INVOLUNTARY TERMINATION FOR CAUSE. Avid may terminate your employment
for "Cause" by written notice setting forth the Cause for termination.
"Cause" means a willful engaging in gross misconduct materially and
demonstrably injurious to Avid or the willful and continued failure by you
substantially to perform your duties with the Company (other than any such
failure resulting from your incapacity due to physical or mental illness)
after a written demand for substantial performance is delivered to you by
the Board of Directors which specifically identifies the manner in which
the Board believes that you have not substantially performed your duties.
"Willful" means an act or omission in bad faith and without reasonable
belief that such act or omission was in or not opposed to the best
interests of Avid. Upon your Date of Termination, you shall be entitled
only to those benefits provided under Section 5.
(c) VOLUNTARY TERMINATION WITHOUT GOOD REASON. You may voluntarily
terminate your employment without Good Reason (as defined below). In such
an event, you shall continue to receive your full base salary and
Employment Benefits during the Notice Period provided you satisfactorily
perform your duties during the Notice Period, unless you are relieved of
those duties by Avid. Upon your Date of Termination, you shall be entitled
only to those benefits provided under Section 5.
(d) VOLUNTARY TERMINATION WITH GOOD REASON. You may voluntarily terminate
your employment with Good Reason. "Good Reason" shall mean a significant
diminution in your duties or responsibilities or any acquisition of Avid
that results in your no longer serving as Chief Executive Officer of an
independent public company. In such an event, you shall continue to
receive your full base salary and Employment Benefits during the Notice
Period. provided you satisfactorily perform your duties during the Notice
Period, unless you are relieved of those duties by Avid. Upon your Date of
Termination, you shall be entitled to those benefits provided under
Section 4.
4. SPECIAL SEVERANCE BENEFITS
If your employment with Avid is involuntarily terminated by Avid without
Cause pursuant to Section 3(a) or by you for Good Reason pursuant to
Section 3(d), then you shall receive the following benefits as long as you
continue to comply with your obligations under Section 8 of this Agreement
and any Invention and Nondisclosure Agreement (or similar agreement)
between you and the Company:
(a) Your base salary shall be continued in effect for a period of twelve
(12) months from your Date of Termination (hereinafter called your
"Severance Pay Period"). Avid will also pay you, during the thirteenth
through twenty-fourth months following termination, on a semi-monthly
basis, the amount by which your monthly base salary at the Date of
Termination exceeds your monthly compensation from your new employer;
(b) You will receive incentive compensation payments in an aggregate
amount equal to your target award for the calendar year immediately
preceding the calendar year in which your Date of Termination occurs,
payable in equal semi-monthly installments during the 12 months following
the Date of Termination. You shall have no right to any pro-rated
incentive compensation in respect of the year of termination;
(c) Notwithstanding any provision to the contrary in any Avid stock plan,
or under the terms of any grant, award agreement or form for exercising
any right under any such plan, any stock options or restricted stock
awards held by you as of the Date of Termination shall become exercisable
or vested, as the case may be, as to an additional number of shares equal
to the number that would have been exercisable or vested as of the end of
the 12 month period immediately following the Date of Termination. Nothing
in this Agreement shall be construed to extend the time period within
which any option may be exercised beyond the period specified in the
applicable stock plan or under the terms of any grant, award agreement or
form for exercising any right under any such plan;
(d) During the Severance Pay Period, in the event you elect to continue to
participate in the Company's medical and dental plans to the extent
permitted under COBRA, the Company shall pay the cost of such
participation;
(e) You shall be entitled to full executive outplacement assistance with
an agency selected by Avid; and
(f) If you do not find employment in Massachusetts following such
termination, Avid shall reimburse you for relocation expenses back to
California or Minnesota, as you may elect.
5. BENEFITS UPON VOLUNTARY TERMINATION WITHOUT GOOD REASON OR TERMINATION
FOR CAUSE.
Upon your termination for Cause in accordance with Section 3(b) or your
termination without Good Reason in accordance with Section 3(c), all
benefits under this Agreement will be void. In such an event, you shall be
eligible for the benefits (if any) provided in accordance with the plans
and policies of Avid which are then applicable to employees of Avid
generally.
6. CONFIDENTIALITY.
The provisions of the Employee Invention and Non-Disclosure Agreement
between you and Avid shall continue in full force and effect following any
termination of employment.
7. RELATIONSHIP TO CHANGE-IN-CONTROL AGREEMENT, ETC.
(a) In the event you become entitled to any benefits under any
Change-in-Control Employment Agreement between you and Avid, such
Change-in-Control Employment Agreement shall control and this Agreement
shall be void and of no further force or effect.
(b) Except as expressly set forth in Section 7(a), this Agreement
supersedes all prior agreements with Avid related to the subject matter
hereof (including all provisions of the letter agreement dated April 3,
1996 other than Sections 5(a), 5(b) and the language of Section 7 through
and including clause (i) thereof, which shall survive), and the special
severance benefits provided under this Agreement are to be provided
instead of any other Avid severance arrangements. Avid's severance
policies and practices are superseded except to the extent incorporated
herein. Notwithstanding the foregoing, nothing contained in this Agreement
shall have any affect upon your rights under any tax qualified "pension
benefit plan", as such term is defined in the Employee Retirement Income
Security Act of 1974, as amended (ERISA); or any other "welfare benefit
plan" as defined in ERISA, including by way of illustration and not
limitation, any medical surgical or hospitalization benefit coverage or
long-term disability benefit coverage; or under any deferred compensation
or equity incentive arrangement, including by way of illustration and not
limitation, any stock incentive plan, non-qualified pension plan, or
phantom stock plan.
8. COVENANT NOT TO COMPETE AND NOT TO SOLICIT.
(a) During the term of this Agreement, and for a period of two (2) years
following the termination of your employment for any reason, you agree you
will not engage in any business (whether as an owner, partner, officer,
director, employee, consultant or otherwise, except as the holder of not
more than 1% of the outstanding stock of a publicly-held company) that
competes or plans to compete with Avid in the business of the development,
manufacture, promotion, distribution or sale of digital film, video or
audio editing, special effects or newsroom automation systems or products
or any other business in which Avid is engaged or plans to engage at the
time of your termination. Without limiting the foregoing, during such
period you shall not be employed by or otherwise serve as a consultant to
Abekas, Accom, Adobe, Carlton Communications, Chyron, Data Translation,
Discreet Logic, DVision, FAST Technology, Hewlett-Packard, Immix, InSync,
Kodak, Lightworks, Macromedia, Matrox, Media 100, Metacreations, MGI,
Newsmaker, Newstar, Panasonic/Matsushita, Philips, Pinnacle Systems, Play
Systems, Pluto Technologies International, Progressive Networks, Quantel,
XXXXX, Scitex, Sonic Solutions, SONY, Softimage/Microsoft, Tektronix,
Transoft, Truevision, VDONet or VXtreme, or any of their subsidiaries and
affiliates.
(b) You also agree that, for a period of two (2) years from the date of
your termination, you will not, either directly or indirectly through an
agency, new employer or otherwise, solicit the employment of (or solicit
to engage as an independent contractor or consultant) any person who at
any time during the one year preceding such solicitation was an employee
or independent contractor of Avid or any Avid affiliate.
(c) If any restriction in this Section 8 is found by any court of
competent jurisdiction to be unenforceable because it extends for too long
a period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may
be enforceable.
(d) The restrictions contained in this Section 8 are necessary for the
protection of the business and good will of Avid and are considered by you
to be reasonable for such purpose. You agree that any breach of this
Section 8 will cause Avid substantial and irrevocable damage and,
therefore, in the event of any such breach, in addition to such other
remedies which may be available, Avid shall have the right to seek
specific performance and injunctive relief.
9. NOTICE.
Notice required or permitted under this Agreement shall be in writing and
shall be deemed to have been given when delivered or mailed by the United
States certified mail, return receipt requested, postage prepaid, in a
properly addressed envelope. Notices to Avid shall be addressed to the
Corporate Secretary.
10. MODIFICATION; SUCCESSORS.
No provision of this Agreement may be waived, modified, or discharged
except pursuant to a written instrument signed by you and Avid. This
agreement is binding upon any successor to all or substantially all
business or assets of Avid.
11. INDEMNIFICATION.
The Company will indemnify you to the extent set forth in the Certificate
of Incorporation and By-laws of the Company for all acts or omissions
occurring during the period of your employment.
12. VALIDITY; COUNTERPARTS
This agreement shall be governed by and construed under the laws of the
Commonwealth of Massachusetts. The validity or enforceability of any
provision hereof shall not affect the validity or enforceability of any
other provision hereof. This Agreement may be executed in one or more
counterparts, each of which together will constitute one and the same
instrument.
Accepted and Agreed Sincerely,
as of November 10, 1997 Avid Technology, Inc.
By: /S/ Xxxxxx Xxxxxxxxx
/S/ Xxxxxxx X. Xxxxxx -------------------------
------------------------- Name: Xxxxxx Xxxxxxxxx
Xxxxxxx X. Xxxxxx Title: Sr. Vice President - Human Resources
