CALPINE CORPORATION
Employment Agreement
This Employment Agreement (this 'Agreement') has been entered into,
effective as of August 1, 1999, between CALPINE CORPORATION, a Delaware
corporation (the 'Company'), and Xxxxxx X. Xxxxx ('Executive') to provide for
the employment of Executive on the terms and conditions set forth herein.
WHEREAS, Executive has served as Senior Vice President-Finance of the
Company since January 1998; and
WHEREAS, the Company wishes to assure itself of the continued employment
efforts of Executive for the period provided in this Agreement, and Executive is
willing to continue to serve in the employ of the Company on a full-time basis
for said period upon the terms and conditions hereinafter provided.
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
intending to be legally bound, the Company and Executive agree as follows:
1. Definitions. The capitalized terms in this Agreement shall have the
meanings set forth in this Agreement or in Appendix A hereto.
2. Employment. The Company hereby employs Executive, and Executive
hereby accepts such employment by the Company, upon the terms and
conditions herein provided.
3. Term of Employment. Executive's employment with the Company
pursuant to this Agreement shall commence on August 1, 1999 and shall
continue through July 31, 2004, unless such employment is sooner terminated
or subsequently extended as hereinafter provided. The Company and Executive
may agree to extend the Employment Period beyond the initial term upon the
terms and conditions of this Agreement or upon other terms, but neither the
Company nor Executive is under any obligation to do so. The period during
which this Agreement continues in effect shall constitute the 'Employment
Period'.
4. Positions and Responsibilities.
(a) Position. During the Employment Period, Executive shall serve
as the Company's Senior Vice President-Finance and shall be
responsible for leading the Company's project and corporate finance
affairs, reporting to the Executive Vice President and Chief Financial
Officer (CFO) of the Company.
(b) Duties. During the Employment Period, and subject to the
control of the Executive Vice President and CFO, Executive shall have
general executive powers and active management and supervision over
the project and corporate finance affairs of the Company and shall
perform such other executive and/or administrative duties consistent
with the office of Senior Vice President-Finance as from time to time
may be assigned to Executive by the Executive Vice President and CFO,
but subject to the conditions in this Agreement. Executive shall
devote substantially Executive's full business time and attention to,
and exert Executive's best efforts in, the performance of Executive's
duties hereunder, so as to promote the business of the Company.
Executive agrees that, during Executive's employment with the Company,
Executive will not provide consulting services to or become an
employee of, any other firm or person engaged in a business in any way
competitive with the Company.
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5. Compensation. For all services rendered by Executive pursuant to
this Agreement, the Company shall pay Executive, and Executive agrees to
accept, the salary, bonuses and other benefits described below in this
Section 5.
(a) Salary. The Company shall pay Executive an annual base salary
('Base Salary') as determined by the Executive Vice President and CFO
in accordance with this Section 5, payable at periodic intervals in
accordance with the Company's payroll practices for salaried
employees. Executive's Base Salary as of the effective date hereof is
two hundred and seventy thousand dollars ($270,000.00) per annum. In
accordance with Section 5(c) hereof, the amount of the Base Salary
shall be reviewed by the Executive Vice President and CFO and approved
by the Board of Directors, if required, on at least an annual basis,
and any increases will be effective as of the date determined
appropriate by the Executive Vice President and CFO. Executive's Base
Salary may be increased for any reason, including to reflect inflation
or such other adjustments as the Executive Vice President and CFO may
deem appropriate; provided, however, that Executive's Base Salary, as
currently in effect as stated above or as so increased, may not be
subsequently decreased, except with the prior written consent of
Executive.
(b) Bonuses. In addition to Base Salary, Executive shall be
entitled to receive, for each fiscal year of the Company ending with
or within the Employment Period, an annual bonus ('Bonus'), whether
pursuant to a formal bonus or incentive plan or program of the
Company. or otherwise. Subject to this Section 5(b) and Section 5(c)
hereof, such Bonus shall be based on such criteria as are in good
faith deemed appropriate by the Executive Vice President and CFO. Any
Bonus earned by Executive for service or performance rendered in any
fiscal year within the Employment Period shall be paid to Executive in
accordance with the applicable plan or program and the Company's
policies governing such matters. For the year ending December 31, 1999
and for all future years hereunder, Executive shall be entitled to
participate in and receive a Bonus in accordance with the terms and
conditions set forth in the Company's Annual Management Incentive Plan
provided, however, that the target bonus for Executive as set forth in
the current Annual Management Incentive Plan shall be fifty percent
(50%). In the event of Executive's death or Disability during the
Employment Period, the Company shall pay to Executive or Executive's
estate the pro rata portion of the Bonus that Executive would have
earned in respect of the portion of the year prior to Executive's
death or Disability.
(c) Annual Compensation Review. Notwithstanding anything herein
to the contrary, Executive's compensation, consisting of salary, bonus
and stock option grants, shall be reviewed annually by the Executive
Vice President and CFO.
(d) Life Insurance. During the Employment Period, the Company
shall provide to Executive a life insurance policy in accordance with
the terms of the current policy maintained by the Company for
Executive, as further described in Section 8(b).
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(e) Health Care. During the Employment Period, Executive shall be
eligible to participate in any health insurance programs and medical
plans available to officers or employees of the Company.
(f) Participation in Benefit and Equity Compensation Plans.
During the Employment Period, Executive shall be eligible to receive
all benefits, including those under equity participation and bonus
programs, to which key employees are or become eligible under such
plans or programs as may be established by the Company. In addition to
any other plans or programs established by the Company, Executive
shall be entitled to participate in the Company's 1996 Stock Incentive
Plan and any similar or replacement plan or program (the 'Stock Option
Program').
(g) 401(k) Plan Benefits. In addition to the other benefits to
which Executive shall be entitled to under this Agreement, Executive
shall be entitled to participate in the Company's 401(k) Plan and
shall be entitled to receive the full benefit of contributions to be
made by the Company for the benefit of Executive under the terms of
the 401(k) Plan.
6. Vacation. During the Employment Period, Executive shall be entitled
to vacation in accordance with the Company's Vacation Policy in effect for
executives. In no event shall such entitlement be less than twenty (20)
business days in each year, with full salary. Furthermore, Executive shall
accrue paid vacation benefits during the Employment Period in accordance
with the Company's Vacation Policy in effect for executives.
7. Indemnification. The Company shall indemnify Executive pursuant to
the provisions of the Company's Articles of Incorporation and Bylaws to the
fullest extent of California law and all other applicable law, and shall
provide Executive with indemnification pursuant to the Company's standard
indemnification agreement and any director's and officer's liability
insurance policy maintained by the Company.
8. Benefits Payable Upon Disability or Death.
(a) Disability Benefits. In the event of the Disability of
Executive, the Company shall continue to pay Executive the salary
payable to Executive in accordance with Section 5 hereof during the
period of Executive's Disability; provided, however, that, in the
event that Executive is disabled for a continuous period exceeding six
(6) calendar months, the Company may elect at the expiration of this
six (6) month period to terminate this Agreement and pay Executive the
greater of (i) Executive's available monthly benefits from any
existing Company-sponsored long-term disability plan; or (ii) sixty
seven percent (67%) of the salary provided in Section 5(a) for the
duration of the Employment Period.
(b) Death Benefits. In the event of Executive's death during
Executive's Disability or otherwise during the Employment Period, the
Company shall cause payment to be made to Executive's most recently
designated beneficiary (which, absent specific designation of a
beneficiary for purposes of this provision, shall be Executive's most
recently designated beneficiary under the Company's group life
insurance program) a sum equal to three (3) times Executive's Base
Salary. This obligation of the Company shall be discharged to the
extent benefits are actually paid pursuant to the Company's group life
insurance program, with the balance of said obligation to be
discharged either by a cash payment from the Company, or, if the
Company so elects, by supplementary life insurance policies to be
obtained and maintained by the Company.
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9. Severance Benefits.
(a) Termination of Employment. In the event Executive's
employment terminates for any reason, except as provided in Section
9(b) in connection with a Change of Control, then Executive shall be
entitled to receive severance benefits as follows:
(i) Voluntary Resignation. If Executive's employment
terminates by reason of Executive's voluntary resignation (and
such termination is not an Involuntary Termination or a
termination for Cause), then Executive shall not be entitled to
receive severance or other benefits except for those (if any) to
which Executive may be entitled under this Agreement or any
separate agreement with the Company or as may then be established
under the Company's then existing severance and benefit plans and
policies at the time of such termination.
(ii) Involuntary Termination Other Than For Cause. If
Executive's employment is terminated as a result of an
Involuntary Termination other than for Cause, then the following
severance benefits shall be paid or otherwise provided to
Executive: (A) the Company shall pay to Executive in the form of
a lump sum payment, in cash, a severance payment equal to the
lesser of (I) three (3) times Executive's Base Salary or (II)
Executive's Base Salary multiplied by the sum of (x) the number
of years (or any portion thereof, calculated on a daily basis)
remaining under this Agreement had Executive's employment not
been terminated, plus (y) an additional one-half year, however,
in no event shall such payment equal less than 100% of
Executive's Base Salary, which shall be paid to Executive within
ten (10) days after the date of termination; (B) until the
earlier of (I) the date this Agreement would otherwise have
terminated had Executive's employment not been terminated (the
'Remaining Term') or (II) the expiration of the three (3) year
period measured from the date of Executive's termination of
employment. The Company shall at its sole cost and expense
provide Executive (and Executive's eligible dependents, if any)
with life, disability, and medical insurance benefits
substantially similar to those benefits that Executive (and
Executive's dependents) were receiving immediately prior to
Executive's termination of employment; provided, however, that
the benefits otherwise receivable by Executive pursuant to this
Section 9(a)(ii)(B) shall be reduced to the extent comparable
benefits are concurrently received by Executive (or Executive's
dependents) pursuant to a similar plan or program of another
employer, and any such other benefits actually received by
Executive (or Executive's dependents) must be reported to the
Company; and provided further, however, that the insurance
coverage provided by the Company pursuant to this Section
9(a)(ii)(B) shall be in lieu of any other continued coverage to
which Executive or Executive's dependents would otherwise, at
Executive's own expense, be entitled in accordance with the
requirements of Internal Revenue Code of 1986, as amended
('Code'), Section 4980B ('COBRA'), by reason of Executive's
termination of employment; (C) all stock options, warrants,
rights and other Company stock-related awards granted to
Executive by the Company that would otherwise have vested or
become exercisable at any time in the future shall become fully
vested and nonforfeitable upon the date of Executive's
termination of employment, the Company's repurchase rights, if
any, with respect to those vested shares shall immediately lapse,
and each such stock option, to the extent vested, shall remain
exercisable for the vested option shares until the expiration or
sooner termination of the option term in accordance with the
provisions of the agreement evidencing such option; and (D) the
Company shall pay or reimburse Executive for any and all expenses
incurred by Executive for outplacement services selected by the
Executive and approved by the Company, which approval will not be
unreasonably withheld, until the earlier of (I) the first
anniversary of the date of termination of employment or (II) the
date on which Executive commences employment with another
employer.
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(iii) Termination for Cause. If Executive's employment is
terminated for Cause, then Executive shall not be entitled to
receive any severance payments or other severance benefits under
this Section 9. Executive's benefits will be continued under the
Company's then existing benefit plans and policies in accordance
with such plans and policies in effect on the date of termination
and in accordance with the requirements of COBRA.
(b) Termination As a Result of a Change of Control. If
Executive's employment with the Company is terminated as a result of a
Change of Control then Executive shall be entitled to receive
severance benefits as follows:
(i) Voluntary Resignation. If as a result of a Change of
Control, Executive's Base Salary is reduced within twelve (12)
months of the Change of Control and, or, Executive's position is
relocated to a place more than one hundred (100) miles from the
Executive's current place of employment within six (6) months of
the Change of Control, and as a result of these changes
Executive's employment terminates by reason of voluntary
resignation (and such termination is not an Involuntary
Termination or a Termination for Cause), then the following
severance benefits shall be paid or otherwise provided to
Executive: (A) the Company shall pay to Executive in the form of
a lump sum payment, in cash, a severance payment equal to the
lesser of (I) two (2) times Executive's Base Salary or (II)
Executive's Base Salary multiplied by the sum of (x) the number
of years (or any portion thereof, calculated on a daily basis)
remaining under this Agreement had Executive's employment not
been terminated, plus (y) an additional one-half year, however,
in no event shall such payment equal less than 100% of
Executive's Base Salary, which shall be paid to Executive within
ten (10) days after the date of termination; (B) until the
earlier of (I) the date this Agreement would otherwise have
terminated had Executive's employment not been terminated (the
'Remaining Term') or (II) the expiration of the three (3) year
period measured from the date of Executive's termination of
employment. The Company shall at its sole cost and expense
provide Executive (and Executive's eligible dependents, if any)
with life, disability and medical insurance benefits
substantially similar to those benefits that Executive (and
Executive's dependents) were receiving immediately prior to
Executive's termination of employment; provided, however, that
the benefits otherwise receivable by Executive pursuant to this
subsection 9(b)(i)(B) shall be reduced to the extent comparable
benefits are concurrently received by Executive (or Executive's
dependents) pursuant to a similar plan or program of another
employer, and any such other benefits actually received by
Executive (or Executive's dependents) must be reported to the
Company; and provided further, however, that the insurance
coverage provided by the Company pursuant to this Section
9(b)(i)(B) shall be in lieu of any other continued coverage to
which Executive or Executive's dependents would otherwise, at
Executive's own expense, be entitled accordance with the
requirements of COBRA by reason of Executive's termination of
employment; and (C) all stock options, warrants, rights and other
Company stock-related awards granted to Executive by the Company
that would otherwise have vested or become exercisable at any
time in the future shall become fully vested and nonforfeitable
upon the date of Executive's termination of employment, the
Company's repurchase rights, if any, with respect to those vested
shares shall immediately lapse, and each such stock option, to
the extent vested, shall remain exercisable for the vested option
shares until the expiration or sooner termination of the option
term in accordance with the provisions of the agreement
evidencing such option.
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(ii) Involuntary Termination Other Than For Cause. If as a
result of a Change of Control and within twelve (12) months of a
Change of Control Executive's employment is terminated as a
result of an Involuntary Termination other than for Cause, then
the Company shall pay or otherwise provide to Executive the
severance benefits described in Section 9(a)(ii) hereof.
(iii) Termination for Cause. If Executive's employment is
terminated for Cause, then Executive shall not be entitled to
receive any severance payments or other severance benefits under
this Section 9. Executive's benefits will be continued under the
Company's then existing benefit plans and policies in accordance
with such plans and policies in effect on the date of
termination.
(iv) Involuntary Termination Other Than For Cause. If as a
result of a Change of Control and within twelve (12) months of a
Change of Control Executive's employment is terminated as a
result of an Involuntary Termination other than for Cause, then
the Company shall pay or otherwise provide to Executive the
severance benefits described in Section 9(a)(ii) hereof.
(c) Parachute Payments. If all or any portion of the amounts
payable to Executive under this Agreement or otherwise are subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code
(the 'Code') (or similar state tax and/or assessment), Company shall
pay to Executive an amount necessary to place Executive in the same
after tax position as Executive would have been in had no such excise
tax been imposed. The amount payable pursuant to the preceding
sentence shall be increased to the extent necessary to pay income and
excise taxes due on such amount. The determination of the amount of
any such additional amount shall be made by the independent accounting
firm then employed by the Company.
10. Nondisclosure of Proprietary Information and Company Documents and
Materials.
(a) Executive understands that the Company possesses and will
possess Proprietary Information which is important to its business.
All Proprietary Information is and shall be the sole property of the
Company. Executive understands that Executive's employment creates a
relationship of confidence and trust between the Company and Executive
with respect to Proprietary Information. At all times, both during
Executive's employment by the Company and after its termination,
Executive shall keep in confidence and trust and will not use or
disclose any Proprietary Information or anything relating to it
without the prior written consent of the Executive Vice President and
CFO, except as may be necessary in the ordinary course of performing
Executive's duties to the Company.
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(b) Executive understands that the Company possesses or will
possess Company Documents and Materials which are important to its
business. All Company Documents and Materials are and shall be the
sole property of the Company. Executive agrees that during Executive's
employment by the Company, Executive will not remove any Company
Documents and Materials from the business premises of the Company or
deliver any Company Documents and Materials to any person or entity
outside the Company, except as Executive is required to do in
connection with performing the duties of Executive's employment.
Executive agrees that, immediately upon the termination of Executive's
employment by Executive or by the Company for any reason, or during
Executive's employment if so requested by the Company, Executive will
return all Company Documents and Materials, apparatus, equipment and
other physical property, or any reproduction of such property,
excepting only (i) Executive's personal copies of records relating to
Executive's compensation; (ii) Executive's personal copies of any
materials previously distributed generally to stockholders of the
Company; and (iii) Executive's copy of this Agreement.
11. Non-Solicitation of Company Employees. During the term of this
Agreement and for a period of twelve (12) months thereafter, the Executive
agrees to not encourage or solicit any employee of the Company to leave the
Company for any reason or to accept employment with any other company. As
part of this restriction, the Executive agrees to not interview or provide
any input to any third party regarding any such person during the period in
question. However, this obligation shall not affect any responsibility the
Executive has with respect to the bona fide hiring and firing of Calpine
personnel.
12. Consulting. Executive and the Company may, but are not required
to, enter into an agreement pursuant to which Executive will provide
consulting services to the Company after the date of Executive's retirement
or termination. Any consulting fees paid to Executive will be in addition
to any retirement or severance payments.
13. Failure to Comply. If, for any reason other than Executive's
death, Disability or Involuntary Termination, Executive shall cease to
render services as required by this Agreement without the written consent
of the Company, or if Executive shall breach the provisions of Sections 10
or 11 hereof, then, Executive will thereby relinquish all rights to any
benefits hereunder, including future salary payments and death benefits,
and the Company shall reserve whatever rights, if any, it may have against
Executive under this Agreement or otherwise.
14. Successors. Any successor to the Company (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation
or otherwise) or to all or substantially all of the Company's business
and/or assets shall assume the obligations under this Agreement and shall
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. The terms of this Agreement and all of
Executive's rights hereunder shall inure to the benefit of, and be
enforceable by, Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
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15. Notice. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered or when mailed by U.S. registered or certified
mail, return receipt requested and postage prepaid. Mailed notices to
Executive shall be addressed to Executive at the home address from which
Executive most recently communicated to the Company in writing. In the case
of the Company, mailed notices shall be addressed to its corporate
headquarters, and all notice shall be directed to the attention of its
Secretary.
16. Miscellaneous Provisions.
(a) No Duty to Mitigate. Executive shall not be required to
mitigate the amount of any payment contemplated by this Agreement
(whether by seeking new employment or in any other manner), nor shall
any such payment be reduced by earnings that Executive may receive
from any other source.
(b) Waiver. No provision of this Agreement shall be modified,
waived or discharged unless the modification, waiver or discharge is
agreed to in writing and signed by Executive and by an authorized
officer or representative of the Company (other than Executive). No
waiver by either party of any breach of, or of compliance with, any
condition or provision of this Agreement by the other party shall be
considered a waiver of any other condition or provision or of the same
condition or provision of another time.
(c) Whole Agreement. No agreements, representations or
understandings (whether oral or written and whether express or
implied) which are not expressly set forth in this Agreement have been
made or entered into by either party with respect to the subject
matter hereof.
(d) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the
State of California.
(e) Severability. If any term or provision of this Agreement or
the application thereof to any circumstance shall, in any jurisdiction
and to any extent, be invalid or unenforceable, such term or provision
shall be ineffective as to such jurisdiction to the extent of such
invalidity of unenforceability without invalidating or rendering
unenforceable the remaining terms and provisions of this Agreement or
the application of such terms and provisions to circumstances other
than those as to which it is held invalid or unenforceable, and a
suitable and equitable term or provision shall be substituted therefor
to carry out, insofar as may be valid and enforceable, the intent and
purpose of the invalid or unenforceable term or provision.
(f) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement may be settled by arbitration in the
County of San Francisco, California, in accordance with the rules of
the American Arbitration Association then in effect. Such arbitration
proceedings shall be nonbinding and any claim with respect to this
Agreement, whether or not previously the subject of an arbitration
proceeding, may be brought in any court of competent jurisdiction.
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(g) Employment Taxes. All payments made pursuant to this
Agreement will be subject to withholding of applicable income and
employment taxes.
(h) Assignment by Company. The Company may assign its rights
under this Agreement to an affiliate, and an affiliate may assign its
rights under this Agreement to another affiliate of the Company;
provided, however, that if there is any such assignment, the Company
will guarantee all payments and the performance of all obligations
under this Agreement. In the case of any such assignment, the term
'Company' when used in a section of this Agreement shall mean the
corporation or other entity that actually employs Executive.
(i) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together
will constitute one and the same instrument.
16. Entire Agreement. This Agreement constitutes the entire agreement
between the Company and the Executive as of the date hereof and supersedes
any prior understandings, agreements, or representations by or between the
Company and the Executive, written or oral, to the extent that they have
related in any way to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement this
day and year first above written.
CALPINE CORPORATION: EXECUTIVE:
By: /s/ Xxx X. Xxxxxx /s/ Xxxxxx X. Xxxxx
--------------------------------- -----------------------------
Xxx X. Xxxxxx, Executive Xxxxxx X. Xxxxx
Vice President and Chief Financial Senior Vice President-Finance
Officer
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APPENDIX A
Definitions
Cause. 'Cause' shall mean (i) material breach of any material terms of this
Agreement, (ii) conviction of a felony, (iii) repeated unexplained or
unjustified absence, (iv) willful breach of fiduciary duty under this Agreement,
or (v) failure to meet the Company's standards of competence and job
performance.
Change of Control. 'Change of Control' shall mean the occurrence of any of
the following events:
(i) a change in ownership or control of the Company effected through
either of the following transactions:
(A) any 'person' (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
'Exchange Act')), other than the Company's current stockholder or a
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any corporation owned, directly or
indirectly, by the Company's stockholders in substantially the same
proportions as their ownership of the Company's stock, becomes the
'beneficial owner' (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing
fifty percent (50%) or more of the total combined voting power of the
Company's then outstanding securities pursuant to a tender or exchange
offer made directly to the Company's stockholders which the Board does
not recommend such stockholders to accept; or
(B) a change in the composition of the Board over a period of
thirty-six (36) consecutive months or less such that the majority of
the members of the Board ceases to be comprised of individuals who are
Continuing Members; for such purpose, a 'Continuing Member' shall mean
an individual who is a member of the Board on the date of this
Agreement and any successor of a Continuing Member who is elected to
the Board or nominated for such election by action of a majority of
Continuing Members then serving on the Board; or
(ii) either of the following stockholder-approved transactions to
which the Company is a party:
(A) a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at
least fifty percent (50%) of the total voting power represented by the
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; or
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(B) the sale, transfer or complete liquidation or dissolution of
the Company of all or substantially all of the Company's assets.
Company Documents and Materials. 'Company Documents and Materials' shall
mean documents or other media or tangible items that contain or embody
Proprietary Information or any other information concerning the business,
operations or plans of the Company, whether such documents, media or items have
been prepared by Executive or others.
Disability. 'Disability' shall mean the inability of Executive to perform
all the material duties of Executive's position as determined by an independent
physician selected with the approval of the Company and Executive.
Involuntary Termination. 'Involuntary Termination' shall mean termination
by the Company of Executive's employment for any reason other than for Cause,
and shall include Executive's voluntary resignation following (i) the material
breach by the Company of one or more of its obligations under this Agreement
which are not otherwise corrected within ten (10) days following Executive's
written notice to the Company of such breach, or the Executive's annual base
salary is materially reduced.
Proprietary Information. 'Proprietary Information' shall mean information
that was developed, created, or discovered by or on behalf of the Company, or
which became or will become known by, or was or is conveyed to the Company,
which has commercial value in the Company's business; including, but not limited
to, trade secrets, designs, technology, know-how, processes, data, ideas,
techniques, inventions (whether patentable or not), works of authorship,
formulas, business and development plans, customer lists, software programs and
subroutines, source and object code, algorithms, terms of compensation and
performance levels of Company employees, and other information concerning the
Company's actual or anticipated business, research or development, or which is
received in confidence by or for the Company from any other person.
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