EXHIBIT 10.25
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
OF ▇▇▇▇▇▇ ▇▇▇▇
WITH
DSP TELECOM, INC.
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement"), made
and entered into effective as of this 1st day of November, 1996, by and
between DSP TELECOM, INC., a California corporation (hereinafter the
"Corporation"), and ▇▇▇▇▇▇ ▇▇▇▇ (hereinafter "Gilo").
RECITALS
A. On August 1, 1994, Gilo and the Corporation entered into an
Employment Agreement (the "Employment Agreement"), as amended and restated as
of December 15, 1995, for the provision by Gilo of certain services to the
Corporation.
B. The Corporation and Gilo desire to amend and restate the Employment
Agreement according to the terms and conditions set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. EMPLOYMENT DUTIES.
a. GENERAL. The Corporation hereby agrees to employ Gilo, and
Gilo hereby agrees to accept employment with the Corporation, on the terms
and conditions hereinafter set forth.
b. CORPORATION'S DUTIES. The Corporation shall allow Gilo to,
and Gilo shall, perform responsibilities normally incident to his position as
Chairman, subject to his election by the shareholders as a Director, but
otherwise as the immediate superior to the Chief Executive Officer of the
Corporation, commensurate with his background, education, experience and
professional standing. The Corporation shall provide Gilo with a private
office, stenographic help, office equipment, supplies, customary services and
cooperation suitable for the performance of his duties. These duties shall
be performed primarily in Santa Clara, California.
▇. ▇▇▇▇'▇ DUTIES. Unless otherwise agreed to by the parties,
Gilo shall serve as the Chairman of the Board of the Corporation's parent,
DSP Communications, Inc. ("DSPC"), a Delaware corporation. Gilo shall devote
at least twenty (20) hours per week on
average to the work of the Corporation. Gilo shall report directly to DSPC's
Board of Directors. Gilo's service for DSPC's subsidiaries, including,
without limitation, the Corporation, DSP Telecommunications, Ltd , CTP
Systems, Ltd, DSPC Israel, Ltd, DSPC Japan, Inc., and CTP Systems, Inc. shall
be credited to the twenty (20) hour requirement. ▇▇. ▇▇▇▇ shall inform the
Board of any other positions that he takes with any other corporation.
2. TERM. This Agreement shall terminate December 31, 2001, unless (a)
extended as set forth herein, or (b) terminated sooner under the terms of
this Agreement. Thereafter, this Agreement may be renewed by Gilo and the
Board of Directors of this Corporation on such terms as the parties may agree
to in writing. Absent written notice to the contrary, thirty (30) days prior
to the end of the employment term, this Agreement will be renewed for
consecutive one (1) year extensions. As used herein, the term "employment
term" refers to the entire period of employment of Gilo hereunder, including
any extensions.
3. COMPENSATION. Gilo shall be compensated as follows:
a. FIXED SALARY. Gilo shall receive a fixed annual salary of
Three Hundred Thousand Dollars ($300,000). The Corporation agrees to review
the fixed salary following the end of each twelve (12) month period during
the employment term based upon Gilo's services and the Corporation's
financial results during the calendar year, and to make such increases as may
be determined appropriate in the discretion of the Corporation's Board of
Directors.
b. PAYMENT. Gilo's fixed salary shall be payable on a
semi-monthly basis.
c. BONUS COMPENSATION. During the employment term, Gilo shall
participate in each bonus plan adopted by the Corpor-ation's Board of
Directors. Commencing in 1996, Gilo shall be entitled to receive an annual
bonus equal to (i) twenty-five percent (25%) of his base salary should this
Corporation meet eighty percent (80%) of its plan as presented to the Board
in January of each year, during the term of Gilo's employment ("Yearly
Plan"); (ii) fifty percent (50%) of his base salary should this Corporation
meet its Yearly Plan; and (iii) one hundred percent (100%) of his base salary
should this Corporation meet one hundred twenty percent (120%) of its Yearly
Plan, with the bonus prorated if the Yearly Plan is met between eighty
percent (80%) and one hundred percent (100%); or between one hundred percent
(100%) and one hundred twenty percent (120%). The meeting of the Yearly Plan
for purposes of this Section shall be based upon the actual revenues and
earnings per share for each applicable year (each weighted fifty percent
(50%)) compared to the revenues and
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earnings per share projected in the Yearly Plan (with each item weighted
fifty percent (50%)) and no item shall be counted if it is not at least
eighty percent (80%) met.
d. VACATION. Gilo shall accrue paid vacation at the rate of
twenty-five (25) days for each twelve (12) months of employment. Gilo shall
be compensated at his usual rate of compensation during any such vacation.
Gilo shall be entitled to ten (10) paid holidays during each twelve (12)
months of employment.
e. BENEFITS. During the employment term, Gilo and his dependents
shall be entitled to participate in any group plans or programs maintained by
the Corporation for any employees relating to group health, disability, life
insurance and other related benefits as in effect from time to time. The
level of benefits shall be based on the salary payable to Gilo. The
Corporation shall provide Gilo with Director and Officer Insurance, if
reasonably available to the Corporation, and all of its officers and
directors. Gilo shall in no event receive less insurance coverage than that
available to any other employee. The Corporation shall, at a minimum, keep in
full force and effect its indemnification agreement previously entered into
with Gilo.
4. EXPENSES. The Corporation shall reimburse Gilo for his normal and
reasonable expenses incurred for travel, entertainment and similar items in
promoting and carrying out the business of DSPC in accordance with the
Corporation's general policy as adopted by the Corporation's management from
time to time. As a condition of reimbursement, Gilo agrees to provide the
Corporation with copies of all available invoices and receipts, and otherwise
account to the Corporation in sufficient detail to allow the Corporation to
claim an income tax deduction for such paid item, if such item is deductible.
Reimbursements shall be made on a monthly, or more frequent, basis. The
Corporation shall also reimburse Gilo for all professional membership dues
incurred, if any; all technical books purchased by Gilo; and all moving and
relocation expenses, incurred by Gilo at the Corporation's request.
5. CONFIDENTIALITY AND COMPETITIVE ACTIVITIES. Gilo agrees that
during the employment term he is in a position of special trust and
confidence and has access to confidential and proprietary information about
the Corporation's business and plans. Gilo agrees that he will not directly
or indirectly, either as an employee, employer, consultant, agent, principal,
partner, stockholder, corporate officer, director, or in any similar
individual or representative capacity, engage or participate in any business
that is in competition, in any manner whatsoever, with the Corporation.
Notwithstanding anything in the foregoing to the contrary, Gilo shall be
allowed to invest as a shareholder in publicly traded companies, or through a
venture capital firm or an investment pool.
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For purposes of this Section 5, the term "Corporation" shall also mean
DSPC or any of its subsidiaries.
6. TRADE SECRETS.
a. SPECIAL TECHNIQUES. It is hereby agreed that the Corporation
has developed or acquired certain products, technology, unique or special
methods, manufacturing and assembly processes and techniques, trade secrets,
special written marketing plans and special customer arrangements, and other
proprietary rights and confidential information and shall during the
employment term continue to develop, compile and acquire said items (all
hereinafter collectively referred to as the "Corporation's Property"). It is
expected that Gilo will gain knowledge of and utilize the Corporation's
Property during the course and scope of his employment with the Corporation,
and will be in a position of trust with respect to the Corporation's Property.
b. CORPORATION'S PROPERTY. It is hereby stipulated and agreed
that the Corporation's Property shall remain the Corporation's sole property.
In the event that Gilo's employment is terminated, for whatever reason, Gilo
agrees not to copy, make known, disclose or use, any of the Corporation's
Property without the Corporation's prior written consent which shall not be
unrea-sonably withheld. In such event, Gilo further agrees not to endeavor
or attempt in any way to interfere with or induce a breach of any prior
proprietary contractual relationship that the Corporation may have with any
employee, customer, contractor, supplier, representative, or distributor for
nine (9) months. Gilo agrees upon termination of employment to deliver to the
Corporation all confidential papers, documents, records, lists and notes
(whether prepared by Gilo or others) comprising or containing the
Corporation's Property. Gilo recognizes that violation of covenants and
agreements contained in this Section 6 may result in irreparable injury to
the Corporation which would not be fully compensable by way of money damages.
c. COVENANT NOT TO COMPETE. For a period of one (1) year from
the date of any termination of Gilo's employment with the Corporation,
provided that he has sold substantially all of his stock in the Corporation,
Gilo shall not, directly or indirectly, either as an employee, employer,
consultant, agent, principal, partner, stockholder, corporate officer,
Director, or in any other individual or representative capacity, engage or
participate in any activities within the State of California, which are the
same as, or competitive with, the activities in which the Corporation is
presently engaged.
d. CORPORATION DEFINED. For purposes of this Section 6, the term
"Corporation" shall also mean DSPC and any of its subsidiaries.
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7. TERMINATION.
a. GENERAL. The Corporation may terminate this Agreement without
cause, by written notice. Gilo may voluntarily terminate his employment
hereunder upon ninety (90) days' advance written notice to the Corporation.
b. TERMINATION FOR CAUSE. The Corporation may immediately
terminate Gilo's employment at any time for cause. Termination for cause
shall be effective from the receipt of written notice thereof to Gilo
specifying the grounds for termination and all relevant facts. Cause shall
be deemed to include: (i) material neglect of his duties or a significant
violation of any of the provisions of this Agreement, which continues after
written notice and a reasonable opportunity (not to exceed thirty (30) days)
in which to cure; (ii) fraud, embezzlement, defalcation or conviction of any
felonious offense; or (iii) intentionally imparting confidential information
relating to the Corporation or DSPC or their business to com-petitors or to
other third parties other than in the course of carrying out his duties
hereunder. The Corporation's exercise of its rights to terminate with cause
shall be without prejudice to any other remedy it may be entitled at law, in
equity, or under this Agreement.
c. TERMINATION UPON DEATH OR DISABILITY. This Agreement shall
automatically terminate upon Gilo's death. In addition, if any disability or
incapacity of Gilo to perform his duties as the result of any injury,
sickness, or physical, mental or emotional condition continues for a period
of thirty (30) business days (excluding any accrued vacation) out of any one
hundred twenty (120) calendar day period, the Corporation may terminate
Gilo's employment upon written notice. Payment of salary to Gilo during any
sick leave shall only be to the extent that Gilo has accrued sick leave or
vacation days. Gilo shall accrue sick leave at the same rate generally
available to the Corporation's employees.
▇. ▇▇▇▇▇▇▇▇▇ PAY. If this Agreement is terminated without cause
pursuant to Section 7.a. (above), the Corporation shall pay ▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇/consulting fee equal to the full amount of the compensation that
he could have expected under this Agreement, as and when payable under this
Agreement, without deduction except for tax withholding amounts, through the
end of the term, during which Gilo shall remain as a consultant to the
Corporation. The Corporation shall pay ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ fee equal to his
monthly salary at his then-current rate of fixed salary compensation,
multiplied by the number six (6) if this Agreement is terminated pursuant to
Section 7.b (i) (above) or if Gilo or the Corporation elects not to renew
this Agreement. The Corporation shall pay ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ fee equal to his
monthly salary at his then-current rate of fixed salary compensation,
multiplied by the lesser of the number eighteen (18) or the number of months
left in the original term of this Agreement as set forth
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herein plus eight (8), if Gilo voluntarily elects to terminate his
employment, unless the Corporation successfully claims that a termination in
accordance with Section 7. b(ii) and (iii) is in order, or if Gilo or the
Corporation elects not to renew this Agreement. There shall be no severance
in the event that this Agreement is terminated in accordance with Section 7.b
(ii) and (iii).
8. CORPORATE OPPORTUNITIES.
a. DUTY TO NOTIFY. In the event that Gilo, during the employment
term, shall become aware of any material and significant business opportunity
directly related to the Corporation's digital signal processing business or
the Corporation's wireless PBX business, or such other businesses that become
significant for the Corporation, Gilo shall promptly notify the Corporation's
Directors of such opportunity. Gilo shall not appropriate for himself or for
any other person other than the Corporation, or any affiliate of the
Corporation, any such opportunity unless, as to any particular opportunity,
the Board of Directors of the Corporation fails to take appropriate action
within thirty (30) days. Gilo's duty to notify the Corporation and to
refrain from appropriating all such opportunities for thirty (30) days shall
neither be limited by, nor shall such duty limit, the application of the
general law of California relating to the fiduciary duties of an agent or
employee.
b. FAILURE TO NOTIFY. In the event that Gilo fails to notify the
Corporation of, or so appropriates, any such opportunity without the express
written consent of the Board of Directors, Gilo shall be deemed to have
violated the provisions of this Section notwithstanding the following:
i. The capacity in which Gilo shall have acquired such
opportunity; or
ii. The probable success in the Corporation's hands of such
opportunity.
c. CORPORATION DEFINED. For purposes of this Section 8, the term
"Corporation" shall also mean DSPC or any of its subsidiaries.
9. MISCELLANEOUS.
a. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding between the parties with respect to the subject
matters herein, and supersedes and replaces any prior agreements and
understandings, whether oral or written between them with respect to such
matters. The provisions of this Agreement may be waived, altered, amended or
repealed in whole or in part only upon the written consent of both parties to
this Agreement.
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b. NO IMPLIED WAIVERS. The failure of either party at any time
to require performance by the other party of any provision hereof shall not
affect in any way the right to require such performance at any time
thereafter, nor shall the waiver by either party of a breach of any provision
hereof be taken or held to be a waiver of any subsequent breach of the same
provision or any other provision.
c. PERSONAL SERVICES. It is understood that the services to be
performed by Gilo hereunder are personal in nature and the obligations to
perform such services and the conditions and covenants of this Agreement
cannot be assigned by Gilo. Subject to the foregoing, and except as otherwise
provided herein, this Agreement shall inure to the benefit of and bind the
successors and assigns of the Corporation.
d. SEVERABILITY. If for any reason any provision of this
Agreement shall be determined to be invalid or inoperative, the validity and
effect of the other provisions hereof shall not be affected thereby, provided
that no such severability shall be effective if it causes a material
detriment to any party.
e. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, applicable
to contracts between California residents entered into and to be performed
entirely within the State of California.
f. NOTICES. All notices, requests, demands, instruc-tions or
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given upon
delivery, if delivered personally, or if given by prepaid telegram, or mailed
first-class, postage prepaid, registered or certified mail, return receipt
requested, shall be deemed to have been given seventy-two (72) hours after
such delivery, if addressed to the other party at the addresses as set forth
on the signature page below. Either party hereto may change the address to
which such communications are to be directed by giving written notice to the
other party hereto of such change in the manner above provided.
g. MERGER, TRANSFER OF ASSETS, OR DISSOLUTION OF THE CORPORATION.
This Agreement shall not be terminated by any dissolution of the Corporation
resulting from either merger or consolidation in which the Corporation is not
the consolidated or surviving corporation or a transfer of all or
substantially all of the assets of the Corporation. In such event, the
rights, benefits and obligations herein shall automatically be assigned to
the surviving or resulting corporation or to the transferee of the assets.
h. CONFLICT. The parties acknowledge that Pezzola & ▇▇▇▇▇▇, A
Professional Corporation ("P&R") is counsel to each of them. The parties
have been made aware of the
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conflict and advised to seek independent counsel. Gilo acknowledges that P&R
advised the Corporation and not Gilo. Gilo hereby acknowledges the conflict
and waives it as to P&R's participation in this Agreement. The Corporation
acknowledges the conflict and waives it as to P&R's participation in this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
DSP TELECOM, INC.
a California corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ Hod /s/ ▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇ HOD, Chief Executive ▇▇▇▇▇▇ ▇▇▇▇
Officer ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇