Exhibit 10.14
EMPLOYMENT AGREEMENT
OF ERAN PILOVSKY
WITH
PHASECOM, INC.
THIS EMPLOYMENT AGREEMENT (this "Agreement"), made and entered into
effective as of the 15th day of January, 2000, by and between PHASECOM, INC., a
Delaware corporation (hereinafter the "Corporation"), and ERAN PILOVSKY
(hereinafter "Pilovsky").
RECITALS
A. The Corporation has offered employment to Pilovsky as Vice
President, Finance and Chief Financial Officer.
B. In connection with Pilovsky's employment with the Corporation, the
Corporation and Pilovsky 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 Pilovsky,
and Pilovsky hereby agrees to accept employment with the Corporation, on the
terms and conditions hereinafter set forth.
b. CORPORATION'S DUTIES. The Corporation shall allow Pilovsky to, and
Pilovsky shall, perform responsibilities normally incident to the position of
Vice President, Finance and Chief Financial Officer, commensurate with his
background, education, experience and professional standing. The Corporation
shall provide Pilovsky with such office equipment, supplies, customary services
and cooperation suitable for the performance of his duties.
c. PILOVSKY'S DUTIES. Unless otherwise agreed to by the parties,
Pilovsky shall serve as Vice President, Finance and Chief Financial Officer of
the Corporation. Pilovsky shall devote all of his productive time, attention,
energy and skill 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 Chief Executive Officer or Chairman of the Board.
Pilovsky shall report directly
to the Chief Executive Officer of the Corporation. Pilovsky shall inform the
Chief Executive Officer of any other positions that he takes with any other
entity. Pilovsky's duties shall be performed primarily in Cupertino, California.
2. TERM. The initial term of this employment is three (3) years.
Thereafter, this Agreement may be renewed by Pilovsky 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 twelve (12) month extensions. Should the term of employment
not be renewed after the expiration of the first three (3) year term,
Pilovsky shall be entitled to six (6) months salary as severance, in exchange
for a release as to any and all claims Pilovsky may have against the
Corporation.
3. COMPENSATION. Pilovsky shall be compensated as follows:
a. FIXED SALARY. Pilovsky shall receive a fixed annual salary of Two
Hundred Fifty Thousand Dollars ($250,000). 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 Pilovsky'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.
b. PAYMENT. Pilovsky'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, Pilovsky shall
participate in each bonus plan adopted by the Corporation's Board of Directors.
Commencing in 2000, Pilovsky 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 Pilovsky'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). Pilovsky 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 Pilovsky's employment
terminate prior to the full calendar year.
d. STOCK OPTIONS. Pilovsky shall be eligible for stock options that may
be awarded
by the Corporation, from time to time, in recognition of Pilovsky's contribution
to the Corporation's success.
e. VACATION. Pilovsky shall accrue paid vacation at the rate of twenty
(20) days for each twelve (12) months of employment. Pilovsky shall be
compensated at his usual rate of compensation during any such vacation. Pilovsky
shall be entitled to paid holidays as generally given by the Corporation.
Pilovsky 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, Pilovsky 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. Pilovsky
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 Pilovsky 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, Pilovsky 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 Financial
Officers. As a condition of payment or reimbursement, Pilovsky 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. Pilovsky 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. Pilovsky 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, Pilovsky 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 Pilovsky 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 Pilovsky's employment is terminated, for whatever reason, Pilovsky
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,
Pilovsky 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. Pilovsky agrees upon termination of employment to deliver to the
Corporation all confidential papers, documents, records, lists and notes
(whether prepared by Pilovsky or others) comprising or containing the
Corporation's Property. Pilovsky 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 sixty (60) days written notice. Pilovsky may voluntarily terminate his
employment hereunder upon sixty (60) days' advance written notice to the
Corporation.
b. TERMINATION FOR CAUSE. The Corporation may immediately terminate
Pilovsky's employment at any time for cause. Termination for cause shall be
effective from the receipt of written notice thereof to Pilovsky 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 Pilovsky's death. In addition, if any disability or
incapacity of Pilovsky 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
Pilovsky's employment upon written notice. Payment of salary to Pilovsky during
any sick leave shall only be to the extent that Pilovsky has accrued sick leave
or vacation days. Pilovsky shall accrue sick leave at the same rate generally
available to the Corporation's employees.
d. SEVERANCE PAY. If this Agreement is terminated by the Corporation
without cause pursuant to Section 6.a. (above) the Corporation shall pay
Pilovsky a severance 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 Corporation for cause pursuant to Section
6.b, the Corporation shall pay to Pilovsky a severance 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 Pilovsky may have
against the Corporation. There shall be no severance in the event that this
Agreement is terminated voluntarily by Pilovsky. During the time period for
which Pilovsky 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 Pilovsky, during the employment
term, shall become aware of any material and significant business opportunity
directly related to any of the Corporation's significant businesses, Pilovsky
shall promptly notify the Corporation's Chairman of the Board of such
opportunity. Pilovsky 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.
Pilovsky'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 Pilovsky fails to notify the
Corporation of, or so appropriates, any such opportunity without the express
written consent of the Corporation, Pilovsky shall be deemed to have violated
the provisions of this Section notwithstanding the following:
i. The capacity in which Pilovsky 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 Pilovsky hereunder are personal in nature and the obligations to perform such
services and the conditions and covenants of this Agreement cannot be assigned
by Pilovsky. 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. ERAN PILOVSKY
a Delaware corporation 2802 Cowper Street
20400 Stevens Creek Blvd., Ste. 800 Palo Alto, CA 94306
Cupertino, CA 95014
By: /s/ Stephen P. Pezzola /s/ Eran Pilovsky
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Stephen P. Pezzola, General Counsel (Signature)