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EXHIBIT 10.53
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into effective as of
the 26th day of November, 1999 (the "Effective Date") between ALPHA
MICROSYSTEMS, a California corporation (the "Company") and Xxxxxx X. Xxxxxx (the
"Employee").
RECITALS
WHEREAS, the Company and Employee desire to enter into a contract for
the employment of Employee by the Company which shall provide compensation to
Employee in return for Employee's services to the Company;
WHEREAS, the Company further desires to provide certain compensation for
Employee in the event of his actual or constructive termination by the Company
as a result of a takeover or similar business reorganization or change in
control in order to encourage Employee to remain in the service of the Company
now and in the future when a takeover might be threatened or likely;
NOW, THEREFORE, in consideration of the mutual covenants and
representations contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows:
ARTICLE I
BASIC EMPLOYMENT
1.1 Employment. The Company agrees to employ Employee and Employee
hereby agrees to be employed by the Company to perform the duties described
below for the compensation specified in this Agreement, as it may be amended
from time to time, subject to and upon all the terms and conditions set forth
herein. During Employee's employment hereunder, Employee hereby agrees to use
his best efforts and to devote his full professional time, energy and ability in
order to assure the proper and efficient performance of his work for the
Company. At all times during Employee's employment hereunder, Employee shall not
render services of a business, professional or commercial nature to any other
person or firm, whether for compensation or otherwise, without the prior written
express authorization of the Board of Directors of the Company (the "Board"),
which authorization shall describe the nature and duration of such services and
shall name the person or firm to whom such services may be rendered.
1.2 Term. Employee's employment under this Agreement shall commence on
November 26, 1999, and shall be for an unspecified term until terminated by
Employee or Company pursuant to Article III below (the "Employment period").
1.3 Duties. Employee shall devote his full time, energy and talents to
serving as the Chief Financial Officer of the Company, and shall have such
duties as are typically expected of such officer, subject to the direction of
the President of the Company. The Employee will have
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such authority, power, responsibilities and duties as are inherent to his
position and necessary to carry out his responsibilities and the duties required
of him hereunder.
1.4 Basic Compensation. The Company hereby agrees to pay Employee a base
salary (the "Base Salary") at the weekly rate of Three Thousand Seventy Seven
Dollars ($3,077), which rate may be amended from time to time in accordance with
the provisions of this paragraph, payable with such frequency as is the custom
and practice of the Company, covering employment during the immediately
preceding period for all services rendered by Employee. The Company shall deduct
from any payment such social security insurance, federal, state and other taxes,
state disability insurance and other withholdings as may be required by law.
1.5 Bonus Compensation.
(a) In addition to Base Salary, Employee shall receive bonuses in
the form of cash, stock options, stock grants or other non-cash compensation
("Bonus Compensation") in accordance with the terms of this Section 1.5. The
Company shall deduct from any payment of Bonus Compensation social security
insurance, federal, state and other taxes, state disability insurance and other
withholdings as may be required by law.
(b) Provided that Employee commences his duties on or before
November 29, 1999 and continues in the employ of the Company through December
31, 1999, Employee shall receive a signing bonus in the amount of Fifty Thousand
Dollars ($50,000), to be delivered on or before December 31, 1999.
(c) For each fiscal year, Employee shall be eligible to receive a
discretionary bonus of up to thirty percent (30%) of the Base Salary if one
hundred percent (100%) of the plan achievement for fiscal year 2000 has been
met. The measurement factors and basis for payment for such bonus shall be
determined by the Compensation Committee of the Company's Board of Directors.
1.6 Vacation and Illness. Employee shall be entitled to paid vacation
and sick leave in accordance with the policies established from time to time by
the Company.
1.7 Benefits. During the Employment Period, Employee will be eligible to
participate in all retirement, stock option or other benefit plans available to
officers and employees of the Company. Employee shall also receive employee
group medical, dental and life insurance benefits in accordance with the
policies established from time to time by the Company. Employee will also be
eligible to participate in the following benefit plans, as they may be in effect
from time to time:
(a) Company's Executive Deferred Compensation Program;
(b) Company's Profit Sharing 401(k) Plan, beginning July 1, 2000;
and
(c) Company's Employee Stock Purchase Plan for the semi-annual
period beginning January 1, 2000.
1.8 Expenses. Employee shall be entitled to reimbursement for all
approved reasonable travel and other business expenses incurred by Employee in
connection with his
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services to the Company pursuant to the terms of this Agreement. All business
expenses for which Employee seeks reimbursement from the Company shall be
adequately documented by Employee in accordance with the Company's procedures
covering expense reimbursement and in compliance with the regulations of the
Internal Revenue Service.
ARTICLE II
PROPRIETARY INFORMATION
2.1 Non-Disclosure of Proprietary Information. Employee agrees that,
during and after his employment with the Company, Employee will regard and
preserve as confidential all trade secrets pertaining to the Company's business
that have been or may be obtained by Employee by reason of his employment, and
Employee will not directly or indirectly disclose to any third person or use for
the benefit of anyone other than the Company or use for his own benefit or
purposes, any inventions, designs, improvements, processes, techniques, methods,
ideas, discoveries, developments, formulae, compounds, specifications,
specialized knowledge, data, records, trade secrets, confidential information,
customer lists, customer data, sales data, sales programs, development programs,
acquisition programs, computer code or other secrets or proprietary information
of the Company which he has encountered or originated in the course of or
arising out of his employment with the Company. The parties hereto acknowledge
and agree that the subject matter of the provisions of this Section 2.1 is of a
unique and special nature such that such provisions may be specifically enforced
by a court of equity in addition to whatever other remedies the Company may have
at law.
2.2 Return of Documents and Materials. Employee agrees that any and all
documents and materials, including, without limitation, reports, drawings,
designs, tools, equipment, plans, proposals, marketing or sales plans,
specifications or materials made or prepared, in whole or in part, by Employee
or that may come into Employee's possession by reason of his employment are the
property of the Company and shall not be used by Employee in any way adverse or
competitive to the Company's interests. Employee acknowledges that Employee will
not deliver, reproduce or in any way allow such documents and materials to be
delivered or used by any third party without the specific written direction or
consent of the Company. The parties hereto acknowledge and agree that the
subject matter of the provisions of this Section 2.2 is of a unique and special
nature such that such provisions may be specifically enforced by a court of
equity in addition to other remedies the Company may have at law.
2.3 Ownership of Inventions. Employee agrees that all inventions,
discoveries, improvements, and innovations, whether patentable or not
(hereinafter collectively referred to as "Inventions" or "Invention" as may be
appropriate), conceived or made by Employee, either solely or in concert with
others, during the period of employment with the Company, whether or not made or
conceived during working hours, which (a) relate in any manner to the existing
or contemplated business or research activities of the Company, or (b) are
suggested by or result from Employee's work for the Company, or (c) result from
the use of the Company's time, materials or facilities, shall be the exclusive
property of the Company.
2.4 Assignment of Rights. Employee further agrees:
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(a) That Employee will promptly disclose in writing to the Company
all Inventions conceived or made by Employee, either solely or in concert with
others, during the period of employment by the Company; and
(b) That Employee hereby assigns to the Company Employee's entire
right, title and interest in all Inventions which are the property of the
Company pursuant to Section 2.3 and will, on request, execute specific
assignments to any of such Inventions; and that Employee will execute,
acknowledge and deliver such documents and take such further action considered
necessary by the Company at any time on its request during or subsequent to the
period of employment with the Company at the Company's expense, but without
charge by Employee to the Company, to obtain and defend letters patent and/or
copyrights in any and all countries and to vest title in such Inventions in the
Company or its assigns.
2.5 Statutory Right. Notwithstanding anything to the contrary herein
contained, in accordance with Section 2872 of the California Labor Code,
Employee hereby acknowledges that the provisions of this Agreement which relate
to the ownership of, and the assignment by Employee of Employee's right, title
and interest to, any Invention, will not be applicable to an Invention which is
proved to fully qualify under Section 2870 of the California Labor Code, a copy
of which Employee has read and is attached hereto as Exhibit A.
2.6 Non-Competition; Non-Solicitation. During the term of this
Agreement, (a) the Employee shall not directly or indirectly be employed or
retained by, or render any services for, or be financially interested in any
manner, in any person, firm or corporation engaged in any business which is
competitive in any way with any business in which the Company or any of its
affiliates is engaged (including any program of development or research), (b)
the Employee shall not divert or attempt to divert any business from the Company
or any affiliate, (c) the Employee shall not disturb or attempt to disturb any
business or employment relationships of the Company or any affiliate and (d)
Employee shall not make any derogatory and/or untruthful statements about the
Company or any of its affiliates. Notwithstanding the foregoing provisions of
this Section 2.6, the Employee shall be permitted to (i) invest in mutual funds
which are diversified, open-end management companies (as those terms are defined
in Section 5 of the Investment Company Act of 1940) that are registered under
such Act; (ii) invest in the outstanding stock of any corporation listed on the
New York Stock Exchange or American Stock Exchange or included in the National
Association of Securities Dealers Automated Quotation System (but only to the
extent that the Employee's interest in the stock of any such corporation does
not exceed 5% of the voting power of the outstanding stock of such corporation);
and (iii) purchase and hold any other investment to the extent the Board
consents in writing to such investment; and any investment described in clauses
(i), (ii) or (iii) next above shall not be considered to violate the
requirements of this Section 2.6.
2.7 Specific Performance. The parties hereto agree that the Company
would be damaged irreparably in the event any of the foregoing provisions of
this Article II were not performed by the Employee in accordance with their
respective terms or were otherwise breached and that money damages would be an
inadequate remedy for any such nonperformance or breach. Therefore, the Company
or its successors or assigns shall be entitled, in addition to any other rights
and remedies existing in their favor, to an injunction or injunctions to prevent
any breach or threatened breach of any such provisions and to enforce such
provisions specifically (without posting a bond or other security).
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ARTICLE III
TERMINATION
3.1 Termination of Employment. Notwithstanding anything in this
Agreement to the contrary, express or implied, this Agreement (and Employee's
employment) shall terminate immediately upon the occurrence of any of the
following: (a) written notice given at any time by Employee; (b) the death or
permanent disability (as defined below) of Employee; (c) written notice given at
any time by the Company. For purposes of this Agreement, the term "disability"
shall mean the inability of the Employee to continue to perform his duties under
this Agreement on a full-time basis as a result of mental or physical illness,
sickness or injury for a period of 90 days within any 12 month period, as
determined in the sole and absolute discretion of the Board. EMPLOYEE HEREBY
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, AND HIS EMPLOYMENT HEREUNDER, IS
TERMINABLE AT-WILL (i.e., WITH OR WITHOUT CAUSE) AT ANY TIME BY EITHER PARTY.
3.2 Rights and Payments Upon Termination. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination Date")
shall be as follows:
(a) the Employee's earned but unpaid Base Salary for the period
ending on his Termination Date; and
(b) the Employee's accrued but unpaid vacation pay for the period
ending with his Termination Date, as determined in accordance with the
Company's policy as in effect from time to time.
Except as may be otherwise expressly provided to the contrary in this Agreement,
nothing in this Agreement shall be construed as requiring the Employee to be
treated as employed by the Company following his Termination Date for purposes
of any employee benefit plan or arrangement in which he may participate at such
time.
3.3 Termination Upon Change-In-Control.
(a) Definition of Change-In-Control. For the purposes of this
Article III, each of the following shall be deemed to be a
"Change-In-Control":
(i) merger or consolidation of the Company in which the
Company is not the surviving entity.
(ii) sale of all or substantially all of the assets of the
Company.
(iii) the purchase by any person or entity of more than fifty
percent (50%) of the outstanding common stock of the Company.
(b) Termination. Employee shall be entitled to the severance
payments and other severance benefits set forth in Sections 3.3(c)
hereof if Employee is terminated under either of the following
circumstances:
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(i) if Employee delivers to the Company written notice of
resignation on or before the effective date of a
Change-In-Control (as defined in Section 3.3(a) hereinabove) that
Employee disapproves of the proposed Change-In-Control, which
resignation shall be effective upon the date of
Change-In-Control. Employee shall not be compelled to set forth
any reason or basis for Employee's resignation.
(ii) if Employee does not resign upon a Change-In-Control and
if within 180 days following a Change-In-Control, Employee is
either involuntarily terminated for a reason other than neglect
of duties or misconduct or Employee's responsibilities, duties,
or title as an employee of the Company are substantially changed
without Employee's consent, and as a result thereof, Employee
terminates his employment with the Company.
(c) Calculation of Severance Payment. Upon termination pursuant
to Section 3.3(b), the Employee shall be entitled to receive an amount
equal to his Base Salary for the Company's immediately preceding fiscal
year , payable in equal installments over a twelve-month period
beginning as soon as practicable after the Termination Date.
(d) Stock Option, Stock and Profit Sharing Plans. Upon
termination pursuant to Section 3.3(a), unless prohibited by the terms
of the applicable plan or applicable law, all of Employee's stock
options shall become fully vested.
3.4 Reduction for Withholding Taxes. With respect to any payment
made to the Employee under Article III, the Company shall deduct from
any such payment such social security insurance, state disability
insurance, and federal, state and other taxes and other withholdings as
may be required by law.
ARTICLE IV
MISCELLANEOUS
4.1 Miscellaneous. All notices provided for under this Agreement shall
be deemed to have been duly given if delivered by hand or, in the alternative,
if sent by registered or certified mail, with return receipt requested,
first-class postage prepaid, if to the Company, to Alpha Microsystems, 0000
Xxxxx Xxxxxxxx Xxxxxx, Xxxxx Xxx, XX 00000; Attention: President; if to
Employee, to Xxxxxx X. Xxxxxx, 000 Xxxxxxxx Xxxx Xxxx, Xxxxxx, XX 00000, or to
such other address with respect to each party as such party shall notify the
other in writing. Delivery of any such communications so made by mail shall be
deemed to be complete on the date of delivery as shown by the addressee's
registry or certification receipt.
4.2 Assignability. The Company may assign its interest in this
Agreement in connection with a merger or sale of all or substantially all of the
assets of the Company and the provisions of this Agreement shall inure to the
benefit of the successors and assigns of the Company. Employee may not assign or
transfer this Agreement, it being deemed personal to Employee only; provided,
however, that upon Employee's death, Employee's heirs, executors and/or
administrators may seek collection of any sums that may have been due Employee
as of Employee's death (it being hereby acknowledged and agreed that no further
payments pursuant to Section 3.3(c)shall be due after Employee's death). Subject
to the above, this Agreement shall
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be binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and assigns. The provisions
of this Section 4.2 shall survive the termination of this Agreement.
4.3 Entire Agreement; Amendments. This Agreement constitutes the entire
agreement between the parties pertaining to the subject matter herein and
supersedes all prior agreements, representations and understandings of the
parties including that offer letter dated November 9, 1999. No modification or
amendment to this Agreement shall be effective unless in a writing executed by
both parties.
4.4 Captions. Any captions to or headings of the articles, sections,
subsections, paragraphs or subparagraphs of this Agreement are solely for the
convenience of the parties, are not a part of this Agreement and shall not be
used for the interpretation of determination of the validity of this Agreement
or any provisions hereof.
4.5 Severability. In the event that any one or more provisions, clauses,
paragraphs, subclauses or subparagraphs contained in this Agreement shall for
any reason be held to be invalid, illegal, void or unenforceable, the same shall
not affect any other provision, paragraph, clause, subparagraph or subclause of
this Agreement, but this Agreement shall be construed as if such invalid,
illegal, void or unenforceable provision, clause, paragraph, subparagraph or
subclause had never been contained herein.
4.6 Waiver. The waiver by the Company or the Employee of any breach of
any term or condition of this Agreement shall not be deemed to constitute the
waiver of any other breach of the same or any other term or condition hereof.
4.7 Costs of Disputes. Each party shall bear his/its own costs in
connection with any controversy or dispute arising out of or relating to this
Agreement (or the breach thereof).
4.8 Survival of Agreement. Except as otherwise expressly provided in
this Agreement, the rights and obligations of the parties to this Agreement
shall survive the termination of the Employee's employment with the Company.
4.9 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
4.10 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.
4.11 Arbitration. To the fullest extent allowed by law, any controversy,
claim or dispute between the Employee and the Company (and/or any of its
directors, officers, employees or agents) relating to or arising out of the
Employee's employment or the cessation of the Employee's employment will be
submitted to final and binding arbitration in Orange County, California, for
determination in accordance with the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association as the exclusive
remedy for such controversy, claim or dispute. This means that both the Employee
and the Company give up all rights to a trial by jury. Possible disputes covered
by the above include (but are not limited to) wage, contract, tort,
discrimination, or other employment-related claims under laws known as
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Title VII of the Civil Rights Act, the California Fair Employment and Housing
Act, the Americans With Disabilities Act, the Age Discrimination in Employment
Act, and any other statutes or laws relating to an employee's relationship with
his employer. However, claims for workers' compensation benefits and
unemployment insurance (or any other claims where mandatory arbitration is
prohibited by law) are not covered by this arbitration agreement, and such
claims may be presented by the Employee or the Company to the appropriate court
or state agency as provided by California law. Judgment on any award issued by
the arbitrator may be entered in any court having jurisdiction thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to
be effective as of the Effective Date first above written.
"Company" ALPHA MICROSYSTEMS,
a California corporation
By:___________________________
Name:_________________________
Title:________________________
"Employee" ______________________________
Xxxxxx X. Xxxxxx
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