Exhibit 10.9
FORM OF EXECUTIVE SEVERANCE AGREEMENT
THIS EXECUTIVE SEVERANCE AGREEMENT ("Agreement") is effective as of the
______________, 2000 by and between Tvia, Inc., a California corporation
("Company"), and ____________________________ (the "Designated Officer") for the
purpose of setting forth the agreement between the Company and the Designated
Officer regarding certain severance payments, as more fully described herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereto agree as follows:
1. Definitions. The following terms shall have the meanings set forth below
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for all purposes of this Agreement.
"Cause" means the Designated Officer's: (1) conviction of a felony; (2)
gross negligence or gross misconduct in carrying out duties for the Company,
which causes material harm to the Company; or (3) violation of the Company's
Proprietary Information and Inventions Agreement (to which the Designated
Officer is a party).
"Change in Control" means:
(1) The consummation of a merger or consolidation of the Company with
or into another entity or any other corporate reorganization, if more than 50%
of the combined voting power of the continuing or surviving entity's
securities outstanding immediately after such merger, consolidation or other
reorganization is owned by persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization; or
(2) Any transaction (other than an issuance of shares by the Company
for cash) in or by means of which one or more persons acting in concert
acquire, in the aggregate, more than 50% of the combined voting power of the
Company's outstanding equity securities; or
(3) The sale, transfer or other disposition of all or substantially
all of the Company's assets other than in connection with a dissolution of the
Company.
A transaction shall not constitute a Change in Control if: (1) its sole
purpose is to change the state of the Company's incorporation; (2) its sole
purpose is to create a holding company that will be owned in substantially the
same proportions by the persons who held the Company's securities immediately
before such transaction; or (3) such transaction constitutes the Company's
initial public offering of its securities.
"Good Reason" means any of the following which is not cured within 15 days
after the Designated Officer's written notice to the Board of Directors that
Good Reason exists for one or more of the following specifically identified
reasons: (1) a material change, without the Designated Officer's consent, in
the Designated Officer's duties, offices, titles or reporting requirements; (2)
relocation of the Designated Officer's office more than 35 miles from its
present location; (3) reduction in the Designated Officer's base salary; or (4)
a material breach in the terms of the Designated Officer's employment agreement.
2. Benefits. The Designated Officer shall receive the benefits described below
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upon the events described below:
2.1 Change in Control without Subsequent Termination of Employment. Upon a
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Change in Control, twenty-five percent (25%) of the Designated Officer's
unvested options to purchase Company shares, determined as of the date of the
Change in Control, will immediately vest.
2.2 Change in Control with Subsequent Termination of Employment.
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(1) If within two years after the date of a Change in Control the
Designated Officer's employment with the Company is involuntarily terminated
(other than for Cause or upon his or her death, disability or retirement) or
if the Designated Officer resigns for Good Reason, he or she shall receive
[18] [9] months of then current monthly salary payable monthly.
(2) If within two years after the date of a Change in Control of the
Company, the Designated Officer's employment is involuntarily terminated
(other than for Cause) or if the Designated Officer resigns for Good Reason,
100% of his or her then remaining unvested options to purchase Company shares
will become vested on his or her termination date.
(3) The following are conditions to receipt of any benefits
described in this Section 2.2.
(a) The Designated Officer will be required to execute a
release of all claims arising out of his or her employment or the termination
thereof, including, but not limited to, any claim of discrimination under
state or federal law, but excluding claims for indemnification from the
Company under (i) any indemnification agreement with the Company, (ii) the
Company's certificate of incorporation and by-laws or (iii) applicable law and
claims for directors' and officers' insurance coverage.
(b) The Designated Officer shall not, without the Company's
written consent, directly or indirectly, alone or as a partner, member of a
joint venture, officer, director, employee, consultant, agent or stockholder
(other than as a less than 5% stockholder of a publicly traded company): (i)
solicit or encourage any of the Company's customers to cease or modify their
relationship with the Company, (ii) hire any of the Company's employees or
consultants in an unlawful manner or actively encourage employees or
consultants to leave the Company, or (iii) otherwise breach his or her
confidential information and trade secret obligations to the Company.
(4) The Designated Officer will be entitled to receive (a) benefits
payable to him or her under any other plan or agreement relating to
retirement, and (b) any COBRA benefits under the Company's medical or dental
plans, to the extent he or she is eligible, beginning on the date his or her
employment with the Company terminates.
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3. Effect of Reemployment. If the Company or an affiliate reemploys the
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Designated Officer during the period his or her compensation is being paid under
Section 4.2(1), the remaining portion of his or her salary payments under
Section 4.2(1) will be discontinued beginning on the first day of such
reemployment.
4. Basis of Payments. Payments under this Agreement will be paid in accordance
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with the Company's normal payroll practices, subject to all applicable federal
and state withholding taxes.
5. Modifications. No modification of this Agreement shall be valid unless made
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in writing and signed by the parties hereto.
6. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of California, exclusive of its choice of
law provisions.
IN WITNESS WHEREOF, the parties have executed this Agreement on _______ __,
2000.
TVIA, INC.,
a California corporation
By:
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Name:
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Title:
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DESIGNATED OFFICER
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