Exhibit 10.16
EMPLOYMENT AGREEMENT
OF MICHAEL CORWIN
WITH
PHASECOM, INC.
THIS EMPLOYMENT AGREEMENT (this "Agreement"), made and entered into
effective as of the 1st day of January, 2000, by and between PHASECOM, INC., a
Delaware corporation (hereinafter the "Corporation"), and MICHAEL CORWIN
(hereinafter "Corwin").
RECITALS
A. The Corporation has employed Corwin as Chief Operating Officer.
B. In connection with Corwin's employment with the Corporation, the
Corporation and Corwin 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 Corwin,
and Corwin hereby agrees to accept employment with the Corporation, on the terms
and conditions hereinafter set forth.
b. CORPORATION'S DUTIES. The Corporation shall allow Corwin to, and
Corwin shall, perform responsibilities normally incident to the position of
Chief Operating Officer, commensurate with his background, education, experience
and professional standing. The Corporation shall provide Corwin with such office
equipment, supplies, customary services and cooperation suitable for the
performance of his duties.
c. CORWIN'S DUTIES. Unless otherwise agreed to by the parties, Corwin
shall serve as Chief Operating Officer of the Corporation. Corwin 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. Corwin shall report directly to the Chief
Executive Officer of the Corporation. Corwin shall inform the Chief Executive
Officer of any other positions that he takes with any other entity. Corwin
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 Corwin 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, Corwin shall be entitled to eighteen (18) months
salary as severance, in exchange for a release as to any and all claims Corwin
may have against the Corporation.
3. COMPENSATION. Corwin shall be compensated as follows:
a. FIXED SALARY. Corwin shall receive a fixed annual salary of Two
Hundred Twenty-five Thousand Dollars ($225,000). 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 Corwin'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 Chief Executive Officer or Board of Directors.
b. PAYMENT. Corwin'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, Corwin shall
participate in each bonus plan adopted by the Corporation's Board of Directors.
Commencing in 2000, Corwin 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 Corwin'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). Corwin 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 Corwin's employment terminate
prior to the full calendar year.
d. STOCK OPTIONS. Corwin shall be eligible for stock options that may
be awarded by the Corporation, from time to time, in recognition of Corwin's
contribution to the Corporation's success.
e. VACATION. Corwin shall accrue paid vacation at the rate of twenty
(20) days for each twelve (12) months of employment. Corwin shall be compensated
at his usual rate of compensation during any such vacation. Corwin shall be
entitled to paid holidays as generally given by the Corporation. Corwin 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, Corwin 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. Corwin
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 Corwin 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, Corwin 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 Operating
Officers. As a condition of payment or reimbursement, Corwin 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. Corwin 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. Corwin 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, Corwin 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 Corwin 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 Corwin's employment is terminated, for whatever reason, Corwin 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, Corwin 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. Corwin
agrees upon termination of employment to deliver to the Corporation all
confidential papers, documents, records, lists and notes (whether prepared by
Corwin or others) comprising or containing the Corporation's Property. Corwin
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. Corwin 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
Corwin's employment at any time for cause. Termination for cause shall be
effective from the receipt of written notice thereof to Corwin 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 Corwin's death. In addition, if any disability or
incapacity of Corwin 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 Corwin's employment upon written notice. Payment of
salary to Corwin during any sick leave shall only be to the extent that Corwin
has accrued sick leave or vacation days. Corwin 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 Corwin 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 Corwin 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 Corwin may have
against the Corporation. There shall be a three (3) month severance in the
event that this Agreement is terminated voluntarily by Corwin. During the
time period for which Corwin 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 Corwin, during the employment
term, shall become aware of any material and significant business opportunity
directly related to any of the Corporation's significant businesses, Corwin
shall promptly notify the Corporation's Chairman of the Board of such
opportunity. Corwin 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.
Corwin'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 Corwin fails to notify the
Corporation of, or so appropriates, any such opportunity without the express
written consent of the Corporation, Corwin shall be deemed to have violated the
provisions of this Section notwithstanding the following:
I. The capacity in which Corwin 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 Corwin hereunder are personal in nature and the obligations to
perform such services and the conditions and covenants of this Agreement cannot
be assigned by Corwin. 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. MICHAEL CORWIN
a Delaware corporation 15 Shasta Lane
20400 Stevens Creek Blvd., Ste. 800 Menlo Park, CA
Cupertino, CA 95014
By: /s/ Davidi Gilo /s/ Michael Corwin
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Davidi Gilo, Chief (Signature)
Executive Officer