EXHIBIT 10.22
EMPLOYMENT AGREEMENT
DATED AS OF JANUARY 1, 2000
BY AND BETWEEN
PhaseCom Ltd., company number ▇▇-▇▇▇▇▇▇-▇, a company having an office and place
of business in Har Hotzvim, Jerusalem, Israel (the "Company")
AND
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, identity number 5036905 of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇
(the "Employee")
WHEREAS, the Company desires to employ the Employee as its Vice President of
Engineering and Chief Technical Officer, and to avail itself of the Employee's
talents and abilities; and
WHEREAS, the Employee desires to be employed by the Company, subject to the
terms and conditions set forth below.
NOW, THEREFORE, the parties hereby agree as follows:
1. EMPLOYMENT DUTIES
1.1. Employee shall perform the responsibilities of Vice President of
Engineering and Chief Technical Officer of the Company, and any
responsibilities incidental thereto.
1.2. Employee shall devote his full business time and attention to the
business of the Company, and shall not become engaged in any other
occupation whether for compensation or not while employed
hereunder, without the express written consent of the Company's
Board of Directors.
1.3. Employee's employment with the Company may require travel outside
Israel, and the Employee agrees to such travel as may be necessary
in order to fulfill his duties toward the Company.
1.4. Employee's position is a "senior managerial position", as defined
in the Work and Rest Hours Law, 1951, and requires a high level of
trust. Accordingly, the provisions of said law shall not apply to
Employee and Employee agrees that
he may be required to work beyond the regular working hours of
the Company, for no additional compensation other than as
specified in this Agreement.
1.5. Employee declares that the fulfillment of the undertakings
pursuant to this Agreement, his employment by the Company and the
use of information in his possession and of his abilities, does
not breach, and will not breach, any other agreement or
undertaking for the preservation of confidentiality and
non-competition to which he is a party. Employee agrees and
undertakes not to perform any act or to omit to perform any act
which may breach his fiduciary duty to the Company or which may
place him in a position of conflict of interest with the
objectives of the Company. In addition, Employee agrees and
undertakes to inform the Company promptly of any such matter which
may place him in such a situation of potential conflict of
interest.
2. TERM
This Employment Agreement commences as of January 1, 2000, and shall
continue for a period of thirty-six (36) months (the "Initial Term"),
unless sooner terminated in accordance with the terms of Section 9 below.
Upon the expiration of the Initial Term, this Employment Agreement shall
automatically renew for successive twelve (12) month periods (each twelve
month period shall be referred to as an "Extended Term"), unless sooner
terminated in accordance with the terms of Section 9 below.
3. COMPENSATION
3.1. FIXED SALARY. Employee shall receive a fixed monthly Gross Salary
of NIS 50,000 (Fifty Thousand New Israeli Shekels) (the "GROSS
SALARY"), payable on the first business day of each month for the
immediately preceding month.
Once every six months, starting July 1, 2000, the Gross Salary shall be
prospectively adjusted (the "Adjustment") to reflect the increases in the
Consumer Price Index published by the Israeli General Bureau of
Statistics (the "CPI") during the six month period preceding each
Adjustment, based on the last known CPI at the time of each Adjustment.
For the purpose hereof, the base CPI shall be the CPI for the month of
January, 2000, published on February 15, 2000. For the avoidance of
doubt, it is hereby clarified that such linkage shall be in lieu of any
other linkage or allowances with respect to the Cost of Living.
3.2. ANNUAL REVIEW. At the end of each calendar year during the Initial
Term and any Extended Term the Company and the Employee shall
conduct good faith negotiations with respect to the Employee's
Gross Salary, taking into account
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the nature of the Employee's position and the Company's business,
economic and financial situation.
3.3. BONUS. During the Initial Term and the Extended Term, Employee
shall participate in each bonus plan adopted by the Board of
Directors of PhaseCom, Inc., the Company's parent corporation
("Parent"). Commencing in 2000, Employee shall be entitled to
receive an annual bonus equal to (i) fifteen percent (15%) of his
annual base salary should Parent meet eighty percent (80%) of its
plan as presented to the Board in January of each year, during the
term of Employee's employment ("Yearly Plan"); (ii) fifty percent
(50%) of his annual base salary should Parent meet its Yearly
Plan; and (iii) ninety percent (90%) of his annual base salary
should Parent 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%).
For purposes of this Section, the meeting of the Yearly Plan shall
be based upon the actual revenues set forth by management and
Parent's Compensation Committee for each applicable year (each
compared to the revenues and other items projected in the Yearly
Plan). Employee shall be entitled to receive an additional annual
bonus based on his performance and that of the Company each year
as determined by the Board of Parent, or Parent's Compensation
Committee. The bonus shall be prorated should Employee's
employment terminate prior to the full calendar year.
3.4. VACATION. Employee shall accrue paid vacation at the rate of
twenty eight (28) days for each twelve (12) months of employment.
Employee may not accumulate his vacation days for more than twenty
four (24) months of employment. Notwithstanding the foregoing, no
later than December 31, 2000, the Company shall pay Employee the
pro-rata amount of the Gross Salary with respect to all vacation
days which were accrued by Employee for more than twenty four (24)
months as of the date of such payment.
3.5. SICK LEAVE. Employee shall be entitled to paid sick leave for up
to 30 days for every calendar year, which shall be accruable for
up to 90 days of paid sick leave.
Employee shall not be entitled to paid sick leave from the Company if
such payment was made as part of the disability insurance stated in
Section 3.6 below.
This sick leave shall not be redeemable, whether in the course of
Employee's employment with the Company or subsequent to the termination
thereof, regardless of reason.
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3.6. BENEFITS. During the term of Employee's employment, Employee shall
be entitled to Manager's Insurance (BITUACH MINHALIM) to be
registered on his name, in an amount equal to 15.83% of the Gross
Salary, which shall be paid monthly to said Manager's Insurance
Plan directly by the Company. The insurance shall be allocated as
follows: (i) 8.33% in respect of severance compensation, (ii) 5%
in respect of pension and (iii) up to 2.5% in respect of
disability. An additional 5% of the Gross Salary shall be deducted
by the Company from the monthly payment of Employee's salary as
Employee's contribution to said Manager's Insurance. Ownership of
the Manager's Insurance policy will be transferred to Employee
upon termination of his employment with the Company.
Notwithstanding the foregoing or anything in this agreement to the
contrary, in the event that the employment relationship between
Employee and the Company is terminated (a) by the Company for
Cause (as defined in Section 9.2 below), or (b) by the Employee,
other than in accordance with Section 9.1 below, Employee shall
immediately transfer and return to the Company the title and any
and all amounts accumulated in the Manager's Insurance on account
of severance pay.
3.7. EDUCATION FUND. The Company shall contribute to a Continuing
Education Fund (KEREN HISHTALMUT), to be chosen by the Company for
the benefit of Employee, in an amount equal to 7.5% of his Gross
Salary per month, subject to Employee's contribution of an
additional 2.5% of his Gross Salary per month. All tax obligations
related to the Education Fund shall be borne by the Employee.
3.8. RECREATION FUNDS. The Company shall provide and pay Employee
Recreation Funds (DMEI HAVRA'AH) at the rate required by law and
regulations.
3.9. AUTOMOBILE. The Company shall provide the Employee with an
automobile in such model and size as shall be determined by the
Board of Directors of the Company. The Company shall pay all
actual maintenance, gas and insurance expenses of the automobile.
All tax obligations related to the automobile shall be borne by
the Company.
3.10. TELEPHONE. The Company shall bear all expenses incurred in
connection with the maintenance of a dedicated telephone line in
the Employee's home, solely for the purpose of enabling the
Employee to conduct business affairs from his home. All tax
obligations related to the maintenance of such telephone line
shall be borne by the Company.
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3.11. MEDICAL EXAMINATION. The Employee shall be entitled to one medical
examination per each calendar year at the Company's cost and
expense, at a medical institution chosen in advance in
coordination with the Company.
4. EXPENSES
The Company shall reimburse Employee for his normal and reasonable
expenses incurred for travel, entertainment and similar items in
promoting and carrying out the business of the Company in accordance with
the Company's general policy, in effect from time to time. As a condition
of reimbursement, Employee agrees to provide the Company with copies of
all available invoices and receipts, and otherwise account to the Company
in sufficient detail to allow the Company to claim an income tax
deduction for such paid item, if item is deductible. Reimbursement shall
be made on a monthly, or more frequent, basis.
5. RESERVE DUTY
Immediately upon receipt of a notice of reserve duty, Employee shall
report such notice to the Company's Board of Directors. Upon Employee's
return from reserve duty, Employee shall deliver to the Company
appropriate confirmation of reserve duty served from his military unit,
against which the Company shall pay Employee his regular compensation
package with respect to the period served.
6. COVENANT NOT TO COMPETE
Employee agrees that he is and shall be in a position of special trust
and confidence and will have access to confidential and proprietary
information about the Company's business and plans. Employee 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 competitive with the Company's business or
with the Business of any parent of subsidiary of the Company, including
projects under consideration by the Company at the time of termination,
during the term of his employment for a period of twelve (12) months
after the termination of his employment, regardless of the reason for
such termination and regardless of whether such termination was initiated
by the Employee or by the Company.
7. CONFIDENTIALITY AND TRADE SECRETS
7.1. KNOW-HOW AND INTELLECTUAL PROPERTY. It is understood that the
Company has developed or acquired and will continue to develop or
acquire certain products, technology, unique or special methods,
manufacturing and assembly processes and techniques, trade
secrets, written marketing plans and
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customer arrangements, and other proprietary rights and
confidential information which are not in the public domain
(collectively referred to as the "COMPANY PROPERTY"). It is
expected that the Employee will gain knowledge of and utilize
the Company Property during the course and scope of his
employment with the Company, and will be in a position of trust
with respect to the Company Property. All inventions and
developments made by the Employee for the Company in the
context of his employment with the Company, and all
intellectual property rights contained therein, shall be deemed
Company Property. Employee agrees that all rights he has to any
technology, patents, copyrights, ideas in whatever form, and
any other intellectual property rights, which relate to the
Company Property are unconditionally assigned to and owned,
free of any third party rights or encumbrances, by the Company,
and the Employee agrees to cooperate with the Company and to
provide to it all details necessary to carry out any
registration or act, to sign any power of attorney or document
and to carry out any act to enable the Company, and only the
Company, to make use of all the Company Property, to duly
register the same, whether in Israel or abroad, should the
Company desire to do so, and/or to protect the same in any
other manner as the Company shall see fit. The Employee's
covenant to assist the Company in the acquisition and
enforcement of intellectual property rights and protections in
connection with the Company Property shall continue to apply
after he has ceased to be employed by the Company.
7.2. COMPANY PROPERTY. It is hereby stipulated and agreed that the
Company Property shall remain the sole property of the Company. It
is further stipulated and agreed by the parties, as a material
inducement for the Company having entered into this Agreement and
remaining a party hereto (subject to any early termination hereof
by the Company), that Employee shall be bound by the Company's
standard Employee Non-Disclosure Agreement.
7.3. EFFECT OF TERMINATION. In the event that Employee's employment is
terminated, for whatever reason, Employee agrees not to copy, make
known, disclose or use, any of the Company Property, and the
Employee shall continue to observe the provisions of the Employee
Non-Disclosure Agreement, which shall survive such termination.
Without derogating from the Company's rights under the law of
torts, Employee further agrees not to endeavor or attempt in any
way to interfere with or induce a breach of any relationship that
the Company may have with any employee, customer, contractor,
supplier, representative, or distributor for a period of eighteen
(18) months from the date of any termination of Employee's
employment with the
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Company for any reason whatsoever. Employee agrees, upon
termination of employment, to deliver to the Company all
confidential papers, documents, records, lists and notes
(whether prepared by Employee or others), in any media
whatsoever, comprising or containing the Company Property,
without retaining any copies thereof, and any other property of
the Company.
7.4. CONFIDENTIALITY. Employee will sign the Company's standard form of
Employee Non-Disclosure Agreement and Non-competition Agreement
(collectively, the "Confidentiality Agreements").
7.5. MATERIAL BREACH. It is hereby agreed that a breach of Sections 6
or 7 or the Confidentiality Agreements shall be considered as a
material breach of this Agreement.
8. CORPORATE OPPORTUNITIES
In the event that during the Employment Term, any business opportunity
related to the Company's business shall come to Employee's knowledge,
Employee shall promptly notify the Company's Board of Directors of such
opportunity. Employee shall not appropriate for himself or for any other
person other than the Company, any such opportunity, except with the
express written consent of the Board of Directors, in advance. Employee's
duty to notify the Company and to refrain from appropriating all such
opportunities shall neither be limited by, nor shall such duty limit, the
application of the general law of Israel relating to the fiduciary duties
of an agent or employee.
9. TERMINATION OF EMPLOYMENT
9.1. GENERAL. This Agreement may be terminated by either party, at any
time, without cause (during the Initial Term or during the
Extended Term), by giving the other party three (3) months'
advance written notice of its election to terminate this
Agreement.
9.2. TERMINATION FOR CAUSE. Notwithstanding Section 2 and Section 9.1
above, the Company may immediately terminate Employee's employment
at any time for Cause. Termination for Cause shall be effective
from the receipt of written notice thereof to Employee. "Cause"
means: (i) material neglect of his duties or a material breach or
violation of any of the provisions of this Agreement; (ii) fraud,
embezzlement, defalcation or conviction of any felonious offense;
or (iii) intentionally imparting confidential information relating
to the Company or Parent or their business to a third party, other
than in the course of carrying out Employee's duties hereunder.
The Company's exercise of its rights to
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terminate with Cause shall be without prejudice to any other
remedy it may be entitled at law or in equity, or nder this
Agreement.
9.3. TERMINATION UPON DEATH OR DISABILITY. This Agreement shall
automatically terminate upon Employee's death. In addition, if any
disability or incapacity of Employee to perform his duties as a
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 and twenty
(120) calendar day period, the Company may terminate Employee's
employment upon written notice. Payment of salary to Employee
during any sick leave shall only be to the extent that Employee
has accrued sick leave or vacation days.
9.4. PRIOR NOTICE PAYMENT. If this Agreement is terminated by the
Company without cause pursuant to Section 9.1 (above), or if after
the initial three (3) year term it is not renewed, the Company
shall pay Employee a prior notice fee equal to the greater of (a)
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; or (b) six (6) months of his then-current salary
without bonus, subject to tax withholding amounts. If this
Agreement is terminated by the Company for cause, pursuant to
Section 9.2 (above), the Company shall pay to Employee a prior
notice fee equal to three (3) months of his then-current salary
without bonus, subject to tax withholding amounts, in exchange for
a release as to any and all claims Employee may have against the
Company. There shall be no prior notice payment in the event that
this Agreement is terminated voluntarily by Employee. During the
time period that Employee is receiving the prior notice pay, he
shall remain as a non-employee consultant of the Company in a
non-policy making role.
10. MISCELLANEOUS
10.1. NO CONFLICTING AGREEMENTS. Employee declares that he is not bound
by any agreement, understanding or arrangement according to which
the execution of and compliance with this Agreement may constitute
a breach or default.
10.2. HEADINGS. The headings of the Sections and subsections of this
Agreement are for convenience of reference only and shall not
affect the meaning or interpretation of the contents of this
Agreement.
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10.3. SEVERABILITY. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect or limit the validity
or enforceability of the remaining provisions of this Agreement.
10.4. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which
together shall constitute one instrument.
10.5. 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, including but not limited to that certain
Employment Agreement dated May 17, 1994, by and between the
Company and Employee. 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.
10.6. 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.
10.7. PERSONAL SERVICES. It is understood that the services to be
performed by the Employee hereunder are personal in nature and the
obligations to perform such services and the conditions and
covenants of this Agreement cannot be assigned by Employee.
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 Company.
10.8. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Israel. In the event
of any controversy or claim arising out of or relating to this
Agreement, or breach thereof, the parties may apply solely to the
court having jurisdiction in Tel Aviv - Jaffa, Israel.
10.9. NOTICES. All notices, requests, demands, instructions or other
communications required or permitted to be given under this
Agreement or related to it 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
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deemed to have been given two (2) days 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.
10.10. MERGER, TRANSFER OF ASSETS, OR DISSOLUTION OF THE COMPANY. This
Agreement shall not be terminated by any dissolution of the
Company resulting from either (i) merger or consolidation in which
the Company is not the consolidated or surviving Company, or (ii)
a transfer of all or substantially all of the assets of the
Company. In each of such events, the rights, benefits, and
obligations herein shall be assigned to the surviving or resulting
Company, or to the transferee of the assets, as applicable.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
PHASECOM LTD. /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇
BY: /s/ ▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇
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NAME: ▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇
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TITLE: Vice President, Finance and Administration
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