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Exhibit 10
CONFIDENTIAL
COVENANT NOT TO COMPETE
THIS COVENANT NOT TO COMPETE (this "Covenant") is made and entered into
as of the 13th day of October, 1999 by and between (i) Intel Corporation, a
Delaware corporation ("Parent"), and (ii) Joseph M. Perl, Ph.D. (the
"Securityholder"), an individual residing in __________ and a shareholder and/or
option holder of DSP Communications, Inc., a Delaware corporation (the
"Company"), with respect to the following:
RECITALS
The following provisions are made a part of and form the basis for this
Covenant:
A. Concurrently herewith, the Company is being acquired by Parent in
exchange for the consideration set forth in, and in accordance with the other
terms and conditions of, that certain Agreement and Plan of Merger dated as of
October 13, 1999 by and among Parent, CWC Acquisition Subsidiary, a Delaware
Corporation and a wholly owned subsidiary of Parent ("Acquisition") and the
Company (the "Agreement").
B. An important factor in Parent's decision to enter into the Agreement
is the Securityholder's covenant not to be involved, for a specified period of
time, in any business that competes with the business conducted by the Company.
But for the Securityholder's agreement to execute this Covenant, Parent would
not have entered into the Agreement or the related transactions.
AGREEMENT
NOW, THEREFORE, in consideration of the premises, the covenants,
conditions, representations, and agreements contained herein and in the
Agreement, the consummation by Parent of the transactions contemplated by the
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Securityholder covenants and agrees with
Parent as follows:
1. Non-Competition
A. Subject to the terms of the Covenant, the Securityholder
agrees that, for a period commencing on the date hereof and continuing for a
period of twenty-one (21) months from the date hereof (the "Covenant Period"),
the Securityholder shall not directly or indirectly (whether for compensation or
otherwise) own, manage, operate or control, or join or participate in the
ownership, management, operation or control of, or furnish any capital to or be
connected in any manner with, any Competing Business (as hereinafter defined)
that is located in or doing business in the Designated Regions (as hereinafter
defined), either as a general or limited partner, proprietor, common or
preferred shareholder, officer, director, agent, employee, consultant, trustee,
affiliate, or otherwise. Nothing contained in this Covenant shall be construed
to prohibit the Securityholder from (i) purchasing or owning, as a passive
investment, up to four percent (4%) of the issued and outstanding shares of any
publicly traded class of securities of any corporation engaged in a Competing
Business, provided that the Securityholder does not render
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any advice of any kind to the management of such corporation or actively
participate in or control, directly or indirectly, any activities of such
corporation or otherwise participate in its business or operations, (ii) acting
as a passive investor of less than 40% of the total assets in any company
through a blind-pool or independently managed investment vehicle such as a
venture capital partnership; or (iii) publishing articles or other writings or
public speaking concerning the Company or its business (so long as not in
violation of any nondisclosure or other commitments to the Company and such
communications are not intended to nor would likely injure the interest of the
Company) or other businesses (whether or not similar to or competitive with the
Company's).
B. During the Covenant Period, the Securityholder without express
prior written approval of Parent, will not (i) solicit any customers of the
Company for or on behalf of any Competing Business or (ii) persuade or attempt
to persuade any customer, supplier, contractor or any other person or party to
cease doing business with the Company or to reduce the amount of business it
does with the Company.
C. During the Covenant Period, the Securityholder will not
knowingly solicit or induce any person who is an employee of the Company to
terminate any relationship such person may have with the Company nor shall the
Securityholder during such period directly or indirectly offer employment to or
compensate or cause any person with which the Securityholder may be affiliated
to offer employment to or compensate, any employee of the Company, or any person
who had been employed by the Company within sixty (60) days of such offer or
compensation (except Pezzola). Notwithstanding the foregoing however, the
Securityholder shall not be precluded from offering employment to or
compensating in any way, persons terminated by the Company with or without
cause. The Securityholder hereby represents and warrants that the Securityholder
has not entered into any agreement, understanding or arrangement with any
employee of the Company pertaining to any business in which the Securityholder
has participated or plans to participate, or to the employment, engagement or
compensation of any such employee.
2. Competing Business Defined. For purposes of this Agreement,
"Competing Business" has the following definition: Any business which consults,
designs, develops, manufactures, sells and or distributes any hardware and/or
software elements used in (i) chipsets for cellular and/or wireless applications
that utilize PDC, GSM, CDMA, TDMA and/or 3G technologies extending such
standards for such applications, (ii) cellular and/or wireless phone handsets
for cellular and/or wireless applications or (iii) cellular and/or wireless base
stations or infrastructure for cellular or other applications using CDMA
technology. Such hardware and/or software elements include, but are not limited
to DSPs, processors (including but not limited to ARM), baseband, analog mixed
signal and/or RF, or any combination thereof).
3. Designated Regions Defined; Related Acknowledgments. For purposes of
this Covenant, "Designated Regions" shall mean all counties, cities, states and
countries throughout the world in which the Company consults, designs, develops,
manufactures, sells and or distributes any hardware and/or software elements
used in (i) chipsets for cellular and/or wireless applications that utilize PDC,
GSM, CDMA, TDMA and/or 3G technologies extending such standards for such
applications, (ii) cellular and/or wireless phone handsets for cellular and/or
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wireless applications or (iii) cellular and/or wireless base stations or
infrastructure for cellular or other applications using CDMA technology. Such
hardware and/or software elements include, but are not limited to DSPs,
processors (including but not limited to ARM), baseband, analog mixed signal
and/or RF, or any combination thereof).The Securityholder hereby acknowledges
and agrees that the Company is conducting business in various places throughout
the world, and that any Competing Business throughout the world in such places
shall be competitive with the Company's business. The Securityholder also
expressly agrees that, should a court of competent jurisdiction determine that
the Designated Regions are broader than may be permitted under applicable law,
such court shall nevertheless enforce this Covenant in the broadest geographical
areas permitted by such applicable law as provided under Section 9 of this
Covenant.
4. Equitable Remedies. The Securityholder hereby acknowledges and agrees
that the obligations under this Covenant are such that Parent cannot adequately
be compensated by damages for breach of such obligations. As a result, the
Securityholder hereby acknowledges and agrees that, in the event of any breach
or threatened breach of this Covenant, Parent shall be entitled not only to
damages or other relief at law, but also to seek equitable relief to enforce the
breached obligations, including, without limitation, preliminary and permanent
injunctive relief (including temporary restraining orders).
5. Binding Agreement. This Covenant and all its terms, provisions, and
conditions shall be binding upon and inure to the benefit of each party to the
Covenant and his or its respective successors and permitted assigns, it being
agreed that only an express written amendment, termination or waiver of this
Covenant by Parent can relieve the Securityholder of his personal obligations
hereunder.
6. Cost and Expenses. If either party to this Covenant brings an action
against the other party to this Covenant to enforce his or its rights under this
Covenant, or for a determination thereof, the prevailing party shall be entitled
to recover his or its reasonable costs and expenses, including, without
limitation, reasonable attorneys' fees and costs, incurred in connection with
such action, including any appeal of such action.
7. Applicable Law. This Covenant shall be construed and enforced in
accordance with the laws of the State of California.
8. Captions. The section headings and captions contained in this
Covenant are for reference purposes and convenience only and shall not in any
way affect the meaning or interpretation of this Covenant.
9. Enforceability. If any provision of this Covenant shall be
determined, under applicable law, to be overly broad in duration, geographical
coverage, substantive scope, or otherwise, such provision shall be deemed
narrowed to the broadest term permitted by applicable law and shall be enforced
as so narrowed. If any provision of this Covenant nevertheless shall be
unlawful, void, or unenforceable, it shall be deemed severable from and shall in
no way affect the validity or enforceability of the remaining provisions of this
Covenant.
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10. Consideration. The Securityholder has been compensated for the
covenants provided herein by, among other things, the consummation of the
transactions called for by the Agreement for which the Securityholder received a
cash payment for securities of the Company.
11. Notice. Any notices hereunder shall be deemed to be properly given
if provided to the Securityholder at his/her address set forth below in the
manner provided in the Agreement.
12. Waiver. The waiver by either party to this Covenant of a breach of
any provision of the Covenant by the other party to this Covenant shall not
operate or be construed as a waiver of any subsequent breach of the same
provision or of any other provision of this Covenant.
13. Amendment. This Covenant may be altered, amended, or terminated only
by an instrument in writing executed by both parties hereto.
14. Counterparts. This Covenant may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15. Contingent Agreement: This Agreement shall become effective only
upon the consummation of the transactions contemplated by the Agreement.
16. Notice of Breach. Notwithstanding anything to the contrary contained
in this Covenant Not To Compete, no conduct, activity or action shall be deemed
to constitute a breach by the Securityholder of any provision of this Covenant
Not To Compete unless (i) the Parent shall have delivered to the Securityholder
a written notice describing, the conduct, activity or action that the Parent
believes to constitute a breach of this Covenant Not To Compete and (ii) the
Securityholder shall have failed to discontinue such conduct, activity or action
within 45 days after receiving such written notice.
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IN WITNESS WHEREOF, Parent and the Securityholder have caused this
Covenant to be duly executed as of the date set forth above.
JOSEPH M. PERL, Ph.D. INTEL CORPORATION, a Delaware corporation
By: /s/ Arvind Sodhani
/s/ JOSEPH M. PERL, PH.D. --------------------------------------
- ------------------------------ Name: Arvind Sodhani
Joseph M. Perl, Ph.D. -------------------------------------
Title: Treasurer
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Address for Notice Address for Notice
27644 Natoma Road Intel Corporation
Los Altos Hills, CA 94022 2200 Mission College Boulevard
Santa Clara, CA 95052
Fax: (408) 765-1859
Attn: General Counsel
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