Exhibit 10.1
July 30, 2007
Mr. John Herzing
Dear John:
This letter sets forth the substance of your voluntary termination from Exar Corporation (the “Company”) in consideration of certain compensation and benefits described below:
Effective July 31, 2007 (the “Termination Date”), you will resign as Vice President, Worldwide Sales, and your employment with the Company will end on that date.
| | (a) | The Company will pay for your COBRA benefits from August 1, 2007 through October 31, 2007. |
| | (b) | The COBRA benefits are limited to medical, dental and vision coverage for you. |
| | (a) | Base Salary.In addition to your regular pay and accrued vacation through your Termination Date, you will receive a one-time payment of twelve (12) weeks of your base pay, amounting to $55,384.62, subject to any applicable withholding taxes. |
| | (b) | Stock Options.Any stock options or other stock awards that are vested as of your Termination Date may be exercised no later than October 31, 2007, which is three (3) months after your Termination Date. |
| | (c) | Other Compensation or Benefits.You acknowledge that, except as expressly provided in this Agreement, you will not receive from the Company any additional compensation (including, but not limited to salary or bonuses, severance, stock, stock options, or other benefits) after the Termination Date. |
You agree that, within ten (10) business days of the Termination Date, you will submit your final documented expense reimbursement statement reflecting all business expenses you incurred through the Termination Date, if any, for which you seek reimbursement. The Company will reimburse you for these expenses pursuant to its regular business practice. Pursuant to its regular business practice, the Company will reimburse you for documented business expenses incurred during the employment term, provided that these expenses have been pre-approved by the President and CEO in writing.
| 5. | Return of Company Property |
On the Termination Date, you agree to return to the Company all Company documents (and all copies thereof) and other Company property that you have had in your possession at any time, including, but not limited to, Company files, notes, drawings, records, business plans and forecasts, financial information, specifications, training materials, computer-recorded information, tangible property including, but not limited to, computers, credit cards, entry cards, identification badges and keys, and any materials of any kind that contain or embody any proprietary or confidential information of the Company (and all reproductions thereof).
| 6. | Proprietary Information Obligations |
You acknowledge your continuing obligations under your Proprietary Rights and Non-Disclosure Agreement attached hereto as Exhibit A. You agree not to use or disclose any confidential or proprietary information of the Company without prior written authorization form a duly authorized representative of the Company.
You agree that for one (1) year following the Termination Date you will not, either directly or through others, (i) solicit or attempt to solicit any employee, consultant, or independent contractor of the Company in order to become an employee consultant or independent contractor to or for any other person or entity, or (ii) solicit business from any of the Company’s or any of its subsidiaries’ customers and users on behalf of any business that directly competes with the Company or any of its subsidiaries.
The provisions of this Agreement will be held in strictest confidence by you and the Company and will not be publicized or disclosed in any manner whatsoever; provided, however, that (a) you may disclose this Agreement to your immediate family; (b) the parties may disclose this Agreement in confidence to their respective attorneys, accountants, auditors, tax prepares, and financial advisors; (c) the Company may disclose this Agreement as necessary to fulfill standard or legally required corporate reporting or disclosure requirements; and (d) the parties may disclose this Agreement insofar as such disclosure may be necessary to enforce its terms or as otherwise required by law. In particular, and without limitation, you will not disclose the provisions of this Agreement to any current or former Company employee or any other Company personnel.
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In exchange for the consideration under this Agreement to which you would not otherwise be entitled, you on behalf of yourself and your respective heirs, family members, executors and assigns hereby release, acquit and forever discharge the Company, and its past, present and future officers, directors, agents, employees, attorneys, shareholder, investors, administrators, divisions, subsidiaries, parents, predecessor and successor corporations, assigns and affiliates, of and from, and agree not to sue or otherwise institute or cause to be instituted any legal or administrative proceedings concerning any and all claims, liabilities, demands, causes of action, costs, expenses, attorneys’ fees, damages, indemnities and obligations of every kind and nature, in law, equity or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed, arising out of or in any way related to agreements, events, acts or conduct in any time prior to and including the execution date hereof, including but not limited to: (i) any and all such claims and demands directly or indirectly arising our of or in any way connected with your employment with the Company or your transition to Special Advisor; (ii) claims or demands related to salary, bonuses, commissions, stock, stock options, or any other ownership interests in the Company, vacation pay, fringe benefits, expense reimbursements, sabbatical benefits, severance benefits, or any other form of compensation; and (iii) claims pursuant to any federal, state, local law, statute or cause of action including, but not limited to, the federal Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991, as amended; the federal Age Discrimination in Employment Act of 1967, as amended (“ADEA”); the federal Americans with Disabilities Act of 1990; the Fair Labor Standards Act, as amended; the Employee Retirement Income Security Act of 1974, as amended; the worker Adjustment and Retraining Notification Act the California Fair Employment and Housing Act, as amended; Labor Code section 201,et seq. and section 970,et seq.; tort law; contract law; wrongful discharge; discrimination; fraud; defamation; harassment; emotional distress; and breach of the implied covenant of good faith and fair dealing.
You acknowledge that you are knowingly and voluntarily waiving and releasing any rights you may have under the ADEA, as amended. You also acknowledge that the consideration given for the waiver and release in the preceding paragraph is in addition to anything of value to which you were already entitled. You further acknowledge that you have been advised by this writing, as required by the ADEA, that: (a) your waiver and release do not apply to any rights or claims that may arise after the execution date of this Agreement; (b) you should consult with and attorney prior to executing this Agreement; (c) you have twenty-one (21) days to consider this Agreement (although you may choose to voluntarily execute this Agreement earlier); (d) you have seven (7) days following the execution of this Agreement by the parties to revoke the Agreement; and (e) this Agreement will not be effective until the date upon which the revocation period has expired, which will be the eighth (8th) day after this Agreement is executed by you (“Effective Date”).
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In granting the release herein, you acknowledge that you understand that you have read and understand Section 1542 of the California Civil Code, which reads as follows:
“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.”
You hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to the release of unknown or unsuspected claims that you may have against the Company.
You agree to refrain from making any negative comments concerning the Company’s business, products or services, officers, employees and directors and to refrain from any, defamation, libel or slander of the Company and its respective officers, directors, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor corporations, and assigns or tortuous interference with the contracts and relationships of the Company and its respective officers, directors, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor corporations and assigns.
| 13. | No Pending or Future Lawsuits |
You represent that you have no lawsuits, claims or actions pending in your name, or on behalf of any other person or entity against the Company or any other person or entity referred to herein. You also represent that you do not intend to bring any claims on your behalf or on behalf of any other person or entity against the Company or any other person or entity referred to herein.
| 14. | No Admission of Liability |
You understand and acknowledge that this Agreement constitutes a compromise and settlement of disputed claims. No action taken by the Company, either previously or in connection with this Agreement shall be deemed or construed to be (i) an admission of the truth or falsity of any claims heretofore made or (ii) an acknowledgement or admission by the Company of any fault or liability whatsoever to either you or to any third party.
| 15. | Arbitration and Equitable Relief |
| | (a) | Except as provided in Section 15(d) below, you and the Company agree that to the extent permitted by law, any dispute or controversy arising out of, relating to, |
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| | or in connection with this Agreement, or the interpretations, validity, construction, performance, breach or termination thereof will be settled by arbitration to be held in the County of Santa Clara, California, in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “Rules”). The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction. |
| | (b) | The arbitrator will apply California law to the merits of any dispute or claim (with the exception of its conflict of laws provisions). You hereby expressly consent to the personal jurisdiction of the state and federal courts located in California for any action or proceeding arising from or relating to this Agreement and/or relating to any arbitration in which the parties are participants. |
| | (c) | The Company will pay the direct costs and expenses of the arbitration. The Company and you each will pay your own counsel fees and expenses. |
| | (d) | The Company or you may apply to any court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as necessary to enforce the provisions of this Agreement, without breach of this arbitration agreement and without abridgement of the powers of the arbitrator. |
| | (e) | You understand that nothing in this Section 15 modifies your at-will status. Either the Company or you can terminate the employment relationship at any time, with or without cause. |
YOU HAVE READ AND UNDERSTAND THIS SECTION 15, WHICH DISCUSSES ARBITRATION. YOU UNDERSTAND THAT BY SIGNING THIS AGREEMENT, YOU AGREE TO THE EXTENT PERMITTED BY LAW, TO SUBMIT ANY FUTURE CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF YOUR RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EXECUTIVE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE FOLLOWING CLAIMS:
ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIES; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND DEFAMATION;
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ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, AND ANY LAW OF ANY STATE; AND
ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
| 16. | Cooperation with Company |
After the employment term, you will cooperate fully with the Company in connection with any and all existing or future litigation, arbitrations, mediations or investigations brought by or against the Company or any of its affiliates in which the Company reasonably deems your cooperation necessary or desirable. You agree to provide advice, assistance and information, including offering and explaining evidence, providing sworn statements, participating in discovery and trial preparation and testimony as may reasonably be deemed necessary or desirable by the Company relating to its position in any such legal proceedings. You will act in good faith to furnish the information and cooperation required by this Section 16 and the Company will act in good faith so that the requirement to furnish such information and cooperation does not create and undue hardship for you. The Company will reimburse your for reasonable out-of-pocket expenses incurred by you as a result of your cooperation, within ten (10) days of the presentation of appropriate documentation thereof, in accordance with the Company’s standard reimbursement policies and procedures.
This Agreement, including Exhibit A, constitutes the complete, final and exclusive embodiment of the entire agreement between you and the Company with regard to the subject matter hereof. It supersedes any and all agreements entered into by and between you and the Company with respect to your employment relationship with the Company. It is entered into without reliance on any promise or representation, written or oral, other than those expressly contained herein. It may not be modified except in a writing signed by you and a duly authorized officer of the Company. Each party has carefully read this Agreement, has been afforded the opportunity to be advised of its meaning and consequences by his or its perspective attorneys, and signed the same of his or its own free will.
You represent that you have had the opportunity to consult with an attorney, and have carefully read and understood the scope and effect of the provisions of this Agreement. Neither party has relied upon any representations or statements made by the other party hereto which are not specifically set forth in this Agreement.
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In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision.
This Agreement may only be amended in writing signed by you and the President and CEO.
This Agreement may be executed in counterparts, and each counterpart shall have the same force and effect as an original and shall constitute an effective, binding agreement on the part of each of the undersigned.
| 22. | Successors and Assigns |
This Agreement will bind the heirs, personal representatives, successors and assigns of each party, and will inure to the benefit of each party, its heirs, personal representatives, successors and assigns.
This Agreement will be deemed to have been entered into and will be construed and enforced in accordance with the laws of the State of California as applied to contracts made and to be performed entirely within California.
If this Agreement is acceptable to you, please sign below and on Exhibit A and return the originals of both to me.
Sincerely,
| | |
| Exar Corporation |
| |
| By: | | /s/ Richard L. Leza |
| Name: | | Richard L. Leza |
| Title: | | Interim President and CEO |
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| UNDERSTOOD AND AGREED: |
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/s/ John Herzing |
| John Herzing |
| |
| Date: | | July 30, 2007 |
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