Exhibit 10.13
EMPLOYMENT AGREEMENT
OF ▇▇▇▇▇▇ ▇▇▇▇
WITH
PHASECOM, INC.
THIS EMPLOYMENT AGREEMENT (this "Agreement"), made and entered into as
of the 1st day of January, 2000, by and between PHASECOM, INC., a Delaware
corporation (hereinafter the "Corporation"), and ▇▇▇▇▇▇ ▇▇▇▇ (hereinafter
"Gilo").
RECITALS
A. The Corporation has employed Gilo as Chief Executive Officer
and Chairman of the Board.
B. In connection with Gilo's employment with the Corporation, the
Corporation and Gilo desire to enter into this Employment Agreement according to
the terms and conditions set forth below.
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 the position of Chief
Executive Officer and Chairman of the Board, commensurate with his background,
education, experience and professional standing. The Corporation shall provide
Gilo with such office equipment, supplies, customary services and cooperation
suitable for the performance of his duties.
▇. ▇▇▇▇'▇ DUTIES. Unless otherwise agreed to by the parties, Gilo shall
serve as Chief Executive Officer and Chairman of the Board of the Corporation.
Gilo shall devote approximately thirty (30) hours per week to the business of
the Corporation, and shall not become engaged to render similar services on
behalf of any other entity while employed hereunder which is in any way
competitive to the Corporation, without the consent of the Corporation's Board
of Directors. Gilo shall report directly to the Corporation's Board of
Directors. Gilo's duties shall be performed primarily in Woodside and/or
Cupertino, California.
2. TERM. The initial term of this employment is three (3) years.
Thereafter, this Agreement may be renewed by Gilo and the Corporation on such
terms as the parties may agree
to in writing. Absent written notice to the contrary, given at least thirty (30)
days prior to the end of the initial three (3) year employment term, this
Agreement will be automatically renewed for consecutive one (1) year extensions.
Should the term of employment not be renewed after the expiration of the first
three (3) year term, Gilo shall be entitled to eighteen (18) months salary as
severance, in exchange for a release as to any and all claims Gilo may have
against the Corporation.
3. COMPENSATION. Gilo shall be compensated as follows:
a. FIXED SALARY. Gilo shall receive a fixed annual salary of Three
Hundred Fifty Thousand Dollars ($350,000). The Corporation agrees to review the
fixed salary on, or before, January 1, 2001, and thereafter at the end of each
calendar year during the employment term based upon Gilo's services and the
financial results of the Corporation, and to make such increases as may be
determined appropriate in the sole discretion of the Corporation's Compensation
Committee or Board of Directors.
b. PAYMENT. Gilo's fixed salary shall be payable on a semi-monthly
basis, in accordance with the Corporation's usual payroll practices.
c. BONUS COMPENSATION. During the Employment Term, Gilo shall
participate in each bonus plan adopted by the Corporation's Board of Directors.
Commencing in 2000, Gilo shall be entitled to receive an annual bonus equal to
(i) fifteen percent (15%) of his annual base salary should the 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 annual base salary should the Corporation meet its Yearly Plan; and
(iii) ninety percent (90%) of his annual base salary should the 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%). For purposes of this Section, the meeting of the Yearly Plan shall be
based upon the actual revenues set forth by management and the Compensation
Committee for each applicable year (each compared to the revenues and other
items projected in the Yearly Plan). Gilo 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 this Corporation, or its Compensation
Committee. The bonus shall be prorated should Gilo's employment terminate prior
to the full calendar year.
d. STOCK OPTIONS. Gilo shall be eligible for stock options that may be
awarded by the Corporation, from time to time, in recognition of Gilo's
contribution to the Corporation's success.
e. VACATION. Gilo shall accrue paid vacation at the rate of thirty (30)
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
paid holidays as generally given by the
Corporation. Gilo shall receive sick leave or disability leave in accordance
with the terms of the Corporation's standard sick leave or disability leave
policy.
f. 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. Gilo shall
also be entitled to Director and Officer ("D&O") insurance in such amounts and
coverage and such indemnification provisions as are afforded other officers and
directors of the Corporation. Benefits under this Section 3.f. will be paid by
the Corporation.
g. 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 the Corporation in accordance with
the Corporation's general policy as adopted by the Corporation's management from
time to time. In addition, Gilo shall be reimbursed for the reasonable costs
associated with one cellular telephone and shall be entitled reimbursement for
such reasonable continuing professional education, memberships and
certifications as are deemed normal and appropriate for Chief Executive Officers
and Chairmen of the Boards. As a condition of payment or 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.
4. 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.
5. 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. 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 after any termination of this Agreement. 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 5 may result in
irreparable injury to the Corporation which would not be fully compensable by
way of money damages.
6. TERMINATION.
a. GENERAL. The Corporation may terminate this Agreement without cause,
on ninety (90) days 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 any of the Corporation's subsidiaries, or their business, to
competitors 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 by the
Corporation without cause pursuant to Section 6.a. (above), the Corporation
shall pay ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ 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) eighteen (18) months
of his then-current salary without bonus, subject to tax withholding amounts.
If this Agreement is terminated by the Corporation for cause pursuant to
Section 6.b, the Corporation shall pay to ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ 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 Gilo
may have against the Corporation. There shall be a nine (9) month severance
in the event that this Agreement is terminated voluntarily by Gilo. During
the time period for which Gilo is receiving severance pay, he shall remain as
a full-time employee of the Corporation in a non-policy making role, and his
options shall continue to vest.
7. 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 any of the Corporation's significant businesses, Gilo shall promptly
notify the Corporation's Chairman of the Board 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 Corporation, 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.
8. 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.
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, instructions 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.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
PHASECOM, INC. ▇▇▇▇▇▇ ▇▇▇▇
a Delaware corporation ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇., ▇▇▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇ Broad /s/ ▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇ Broad, Chairman of (Signature)
the Compensation Committee