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Exhibit 10.11
TERMINATION AGREEMENT
This Termination Agreement is executed November 10, 1996 between COHU,
INC., a Delaware corporation ("Company") and Xxxx X. Xxxxx ("Executive") in
light of the following facts:
A. Executive is a key and critically important member of the management of
Company upon whose continuing services Company is and will depend for its future
growth and prosperity.
B. Company desires to assure itself of the uninterrupted and unimpaired
performance of services by Executive in the future. In particular, Company
desires that there will be no interference with those services or Executive's
loyalty to Company which result from any actual or proposed change of control of
Company. Company believes that the interest of Company and its shareholders will
best be served by providing Executive with economic assurances which will
relieve him of worry about his economic interests in the event of any proposed
change of control and thereby permit him to devote his uninterrupted attention
to the performance of his duties to Company.
NOW, THEREFORE, IT IS AGREED:
1. "Event" Defined. The term "Event" as used in this Agreement shall mean any
one or a combination of the following:
a. A sale by Company of all or substantially all of its assets,
whether for money, securities or other consideration.
b. A merger or consolidation of Company with or into any other
corporation or business entity (excepting only a wholly owned subsidiary of
Company) without regard to whether Company or other party to such transaction is
the surviving corporation.
c. The acquisition of beneficial ownership of a majority of the
outstanding voting stock of Company by any person or entity or affiliated group
of persons and/or entities without regard to whether such stock is held directly
of indirectly.
d. A change in the identities of a majority of the directors of
Company occurring within a period of thirty (30) consecutive months resulting in
whole or in part from the election at one or more meetings of shareholders of
persons who are not listed in the Company's proxy statement as management
nominees.
e. Any other agreement, happening or device which has substantially
the same effect on control of Company as any of the foregoing.
2. "Termination" Defined. The term "Termination" as used in this Agreement
shall mean any one or a combination of the following:
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a. The discharge of Executive by Company or its successor in interest as
the operator of all or substantially all of the business assets of Company for
any reason whatsoever, excepting only discharge by reason of the following:
(i) Death of Executive;
(ii) The mental or physical disability of Executive continuing for a
period exceeding nine months, which prevents Executive from performing a major
portion of his duties;
(iii) For cause consisting of the commission by Executive of a
criminal act related to the performance of his duties, the furnishing of
proprietary confidential information of Company to a competitor or a potential
competitor except in the bona fide belief that such action was for the benefit
and best interests of Company;
(iv) Habitual intoxication by alcohol or drugs during working hours;
(v) Habitual neglect of duties not corrected following written notice
from Company specifying details thereof;
(vi) Required retirement of Executive at or after the Company's normal
retirement age for senior executives, in accordance with established policies
applied on a nondiscriminating basis.
b. Resignation of Executive following the occurrence of one or more
of the following:
(i) Relocation of the principal place at which Executive's duties are
performed to a location outside the County of San Diego, California;
(ii) A reduction in Executive's compensation;
(iii) A change in the benefits or perquisites provided to Executive
which is deemed materially adverse by Executive;
(iv) A change in Executive's responsibilities, authorities or
functions which is deemed materially adverse by Executive;
(v) A change in Executive's work conditions which is deemed
materially adverse by Executive.
3. Payment. In the event that a termination occurs concurrently with or within
five (5) years following an Event, forthwith upon such Termination occurring,
Company or its successor in interest shall pay to Executive a sum equal to the
largest sum of money which would not result in there being an "Excess Parachute
Payment" as defined in Section 280G of the Internal Revenue Code as amended to
the date of this Agreement. This payment shall be in addition to any and all
other benefits to which Executive may be entitled in connection with such
termination, including but not limited to, payment for accrued and unused
vacation or sick pay.
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4. Consideration. This contract is for the purpose of inducing Executive to
continue his employment with Company and is in consideration of the services
rendered by Executive to Company from and after the date of this Agreement,
which consideration Company hereby acknowledges is fair and adequate.
5. Complete Agreement. This constitutes the complete agreement between the
parties with respect to its subject matter. It shall not be amended or rescinded
except by a further written agreement executed by both parties.
6. Successors. This contract shall inure to the benefit of Executive, his
heirs, personal representatives and assigns and shall bind Company and its
successors.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written, in accordance with a resolution made and
instructions given by the Board of Directors of Cohu, Inc. at a meeting held May
7, 1996.
COHU, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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President & CEO
/s/ Xxxx X. Xxxxx
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EXECUTIVE
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