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Exhibit 10.4(j)
EXECUTIVE EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is dated as of ______________,
1998, and is entered into by and between Hamid Shokrgozar ("Executive") and
Bowmar Instrument Corporation, an Indiana corporation, including its divisions
Bowmar Technologies and White Microelectronics ("Bowmar").
WHEREAS, Bowmar desires to continue Executive's employment as the
President and Chief Executive Officer of the White Microelectronics division of
Bowmar ("White") through January 1, 1998 and thereafter employ Executive as the
President and Chief Executive Officer of Bowmar, and the Executive desires to be
employed in those capacities;
WHEREAS, Bowmar desires to facilitate organizational discussions
pertaining to corporate affiliations by removing personal employment security
issues from the process and providing severance benefits which will best serve
its interest in retaining key employees; and
WHEREAS, Executive will report to the Bowmar Board of Directors;
NOW THEREFORE, Executive and Bowmar hereby agree that Executive will
render services to Bowmar on the following terms and conditions:
1. Employment/Director Consideration. Upon the terms and subject to the
conditions contained herein, Executive hereby agrees to provide full-time
services to Bowmar as its President and Chief Executive Officer. During the term
hereof, Executive agrees to devote his best efforts to the business of Bowmar,
and shall perform his duties in a diligent, trustworthy, business-like manner,
all for the purpose of advancing the business of Bowmar. Executive shall not
work for or receive compensation from any other entity for services performed or
to be performed by him during the term of this Agreement, except with the prior
written consent of
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Bowmar's Board of Directors. Executive will be considered for election to
Bowmar's Board of Directors at its meeting scheduled on April 30, 1998. If
Executive is not elected as a member of the Board of Directors at that meeting,
he may elect to terminate his employment with Bowmar and will be paid the
termination benefits set forth in Section 7(b)(i) to (v).
2. Duties. Executive shall perform the duties of President and Chief
Executive Officer of White and President and Chief Executive Officer of Bowmar
in accordance with the policies and practices of Bowmar, as they may be amended
from time to time. Those duties may be changed or modified in the discretion of
Bowmar's Board of Directors.
3. Term of Agreement. This Agreement shall be effective beginning on
October 1, 1997 and shall continue until September 30, 1999, except as provided
herein. It shall thereafter renew automatically for another two-year term,
unless thirty (30) or more days prior to such renewal date either of the parties
notifies the other in writing of its intention not to renew.
4. Base Salary and Benefits. Effective January 2, 1998, Bowmar shall
pay Executive a base salary of One Hundred Eighty Thousand Dollars ($180,000)
per annum, payable in bi-weekly installments, less applicable tax withholding
and salary deductions ("Base Salary"). Executive shall be entitled to
participate in the fringe benefit programs generally available to senior
executives of Bowmar, as they may be modified from time to time.
5. Incentive Compensation. Executive shall be eligible to receive
incentive compensation in accordance with the terms of the White
Microelectronics/Bowmar Bonus Plan as it may be amended. Thereafter, Executive
shall participate in the Bowmar incentive compensation plan or White
Microelectronics Bonus Plan, as they may be amended, as determined by Bowmar's
Board of Directors ("Incentive Compensation").
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6. Stock Options. During the term of this Agreement, Executive shall
participate in Bowmar's Employee Stock Option Plan in accordance with the terms
and conditions of the Plan, as it may be amended.
7. Termination and Termination Benefits. The Executive's employment
hereunder shall terminate under the following circumstances:
(a) Termination by Bowmar For Cause. Bowmar may terminate the
employment of Executive for cause at any time upon written notice to Executive
specifying the cause for termination. For purposes of this Section, "for cause"
shall mean discharge resulting from a determination by Bowmar that the Executive
has: (i) been convicted of a criminal offense involving dishonesty, fraud,
theft, embezzlement, breach of trust or moral turpitude; (ii) performed an act
or failed to act, which, if he were prosecuted and convicted, would constitute a
crime or offense involving money or property of Bowmar; (iii) violated the
provisions of Section 8 pertaining to confidential information; or (iv)
willfully refused to perform the duties reasonably assigned to Executive and
consistent with his status as President and Chief Executive Officer of White and
Chief Executive Officer of Bowmar, provided however that this Section 7(a)(iv)
shall not apply following a Change in Control as defined in Section 7(d).
In the event of Executive's termination by Bowmar under this
Section 7(a), Bowmar shall have no further obligation to Executive except for
any amounts earned by, or accrued for, Executive under any employee benefit
plans in which the Executive is then a participant, earned and unpaid salary,
accrued and unused vacation pay, and any rights of Executive under any bonus or
stock option agreement, which right has been earned by Executive at the time of
such termination pursuant to the terms of such plan or agreement. Executive
shall not be entitled to any further Base Salary, Incentive Compensation,
Severance Pay, fringe
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benefits, additional stock options, or any other compensation or benefits,
except as otherwise provided herein. A termination by Bowmar under this Section
7(a) shall not prejudice any remedy to which Bowmar may be entitled, either at
law or in equity or under this Agreement.
(b) Termination by Bowmar Without Cause. Executive's
employment under this Agreement may be terminated without cause at any time by
Bowmar upon written notice to Executive and, upon such termination, Executive
shall be entitled to the following benefits:
(i) Severance Payment. Bowmar will pay Executive a
single, lump sum "Severance Payment" which shall be the greater of: (a)
Executive's Base Salary for the remaining term of this Agreement or (b) an
amount equal to twelve months of Executive's total current Base Salary and
Incentive Compensation paid for the calendar year immediately preceding the
termination, less all applicable taxes and other withholding.
(ii) Benefit Continuation. Bowmar will continue
benefit contributions (medical, dental, disability and life) on behalf of
Executive for the greater of: (a) the remaining term of this Agreement; or (b)
twelve (12) months; provided, however, that benefits will be terminated if
Executive becomes eligible for such benefits through reemployment or otherwise.
In the event that Bowmar is unable to continue such contributions or secure
replacement coverage, then it shall pay to Executive the premium cost for such
coverage. Executive shall not participate in any other Bowmar benefit plans
except for any amounts earned by, or accrued for, Executive under any employee
benefit plans in which the Executive is then a participant, earned and unpaid
salary and accrued and unused vacation pay and any rights of Executive under any
bonus or stock option agreement, which right has been earned by Executive at the
time of such termination pursuant to the terms of such plan or agreement.
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(iii) Outplacement Assistance. Bowmar will provide
executive-level outplacement services to Executive at the outplacement provider
of his choice for a period not to exceed twelve (12) months in the maximum
amount of $25,000.
(iv) Attorneys' Fees. Bowmar will reimburse Executive
for all reasonable attorneys' fees incurred in connection with enforcing the
terms of this Agreement following termination of employment in the maximum
amount of $25,000, except as otherwise provided in Section 14.
(v) Stock Options. All Bowmar stock options
previously granted to Executive will vest immediately upon termination and
Executive shall have a period of twelve (12) months thereafter to exercise said
options.
(c) Termination by Executive Without Cause. Executive may
terminate this Agreement at any time upon thirty (30) days' prior written notice
to Bowmar. In the event of such termination, Bowmar shall have no further
obligations to Executive under this Agreement except for any amounts earned by,
or accrued for, Executive under any employee benefit plans in which the
Executive is then a participant, earned and unpaid salary and accrued and unused
vacation pay and any rights of Executive under any bonus or stock option
agreement, which right has been earned by Executive at the time of such
termination pursuant to the terms of such plan or agreement. Executive shall not
after termination be entitled to Base Salary, Incentive Compensation, Severance
Pay, fringe benefits, additional stock options, or any other compensation or
benefits. Bowmar may, in its sole discretion, accept Executive's resignation and
terminate his employment prior to the expiration of the thirty (30) day notice
period and pay Executive's compensation for the notice period (or remaining term
thereof).
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(d) Termination of Executive Following a Change in Control. In
the event that a Change in Control occurs when the remaining term of this
Agreement is less than eighteen (18) months, then this Agreement shall be
automatically renewed for a period of eighteen (18) months following the
effective date of the Change in Control. For purposes of this Agreement, a
"Change in Control" shall mean: any sale of all or substantially all of the
assets of Bowmar; or merger or consolidation involving Bowmar, unless the
stockholders of Bowmar receive in the transaction, with respect to their stock
in Bowmar, stock or other securities representing a majority in voting interest
of the acquiring entity's equity securities; or any sale of a majority voting
interest of the outstanding stock of Bowmar by the holders thereof in a single
transaction or series of related transactions. For a period of eighteen (18)
months following the effective date of a Change in Control, the Executive may
terminate the Agreement by written notice to Bowmar's Board of Directors (or its
successor) subsequent to the occurrence of any of the following events:
(i) Notice of termination or a material change in the
nature or scope of Executive's responsibilities, title, authority, reporting
relationship, powers, functions or duties from the responsibilities, title,
authority, reporting relationship, powers, functions or duties exercised by the
Executive immediately prior to the Change in Control; or
(ii) A decrease in the total annual compensation or
benefits payable to Executive other than as a result of a decrease in
incentive-based compensation payable to the Executive and to all other executive
officers of Bowmar on the basis of Bowmar's financial performance;
(iii) A requirement imposed by Bowmar that Executive
relocate to an office that is more than fifty (50) miles distant from the office
at which he is employed or the
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home at which he resides immediately prior to the Change in Control or an
increase in Executive's business travel; or
(iv) Failure of Bowmar's successor to assume its
obligations hereunder following a Change in Control.
In the event the Executive terminates this Agreement under the
terms of this Section 7(d), he shall be paid a lump-sum amount equal to one and
one-half (1-1/2) times Executive's combined current Base Salary and Incentive
Compensation paid for the calendar year immediately preceding the termination,
as well as the additional benefits set forth in Section 7(b), less all
applicable taxes and other withholding. In the event of such termination, Bowmar
shall have no further obligations to Executive under this Agreement except for
any amounts earned by, or accrued for, Executive under any employee benefit
plans in which the Executive is then a participant, earned and unpaid salary and
accrued and unused vacation pay and any rights of Executive under any bonus or
stock option agreement, which right has been earned by Executive at the time of
such termination pursuant to the terms of such plan or agreement.
(e) Non-Renewal Severance Payment. In the event that Bowmar
gives notice of its intention not to renew this Agreement in accordance with
Section 3, it shall, upon the termination of Executive's employment, pay
Executive in a single lump sum an amount equal to the Severance Payment set
forth in Section 7(b)(i), and provide the other benefits set forth in Sections
7(b)(ii) to (v). Bowmar shall have no further obligations to Executive except
for any amounts earned by, or accrued for, Executive under any employee benefit
plans in which the Executive is then a participant, earned and unpaid salary and
accrued and unused vacation pay and any rights of Executive under any bonus or
stock option agreement, which right has been
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earned by Executive at the time of such termination pursuant to the terms of
such plan or agreement.
(f) Illness, Incapacity, or Death. In the event of illness or
incapacity of Executive, Bowmar shall continue Executive's Base Salary for a
period of ninety (90) days or such time as the Executive is eligible for
consideration for long-term disability benefits, whichever occurs last. If
Executive is unable to perform the essential elements of his job due to illness
or incapacity for a period greater than ninety (90) days, Bowmar may elect, in
its sole determination, to terminate this Agreement with no further obligation
to Executive, except for any amounts earned by, or accrued for, Executive under
any employee benefit plans in which the Executive is then a participant, earned
and unpaid salary and accrued and unused vacation pay and any rights of
Executive under any bonus or stock option agreement, which right has been earned
by Executive at the time of such termination pursuant to the terms of such plan
or agreement. If Executive should die during the term of this Agreement,
Executive's heir shall be paid by Bowmar a total amount equal to ninety (90)
days' Base Salary, be entitled to whatever rights the heir may have under
Executive's stock option plan and be granted applicable COBRA rights; Bowmar's
remaining obligations hereunder shall terminate as of the end of the month in
which Executive's death occurs.
8. Confidential Information. In view of the fact that Executive's work
for Bowmar will bring him into close contact with many confidential affairs and
plans of Bowmar not readily available to the public, Executive agrees to keep
secret and retain in the strictest confidence all confidential matters of
Bowmar, including, without limitation, trade "know-how," secrets, customer and
prospect lists, pricing policies, prices, costs, operational and development
methods, and other business affairs of Bowmar (but excluding all information in
the public domain)
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learned by him heretofore or hereafter, and not to disclose them to anyone
outside of Bowmar, either during or after his employment with Bowmar, except in
the course of performing his duties hereunder or with Bowmar's express written
consent. Executive further agrees to deliver promptly to Bowmar, on termination
of his employment, or at any time Bowmar may so request, all memoranda, notes,
records, reports, manuals, drawings, blueprints, computer records and other
documents (and all copies thereof) relating to Bowmar's business and all
property associated therewith, which he may then possess or have under his
control. Executive acknowledges and understands that his obligations with
respect to confidential information shall survive the termination of this
Agreement.
9. Violation of Covenants. If Executive violates any of his covenants
under Section 8, Executive agrees and acknowledges that such violation or
threatened violation will cause irreparable injury to Bowmar and that Bowmar
will be entitled to injunctive relief without the necessity of proving actual
damages.
10. Automobile Allowance. Bowmar shall pay an automobile allowance to
Executive in the amount of $850.00 per month, as it may be changed from time to
time, during the term of this Agreement.
11. Vacation. Bowmar will provide Executive with annual paid vacation
consistent with the policies of Bowmar applicable to senior executive staff, as
they may be changed from time-to-time.
12. Company Expenses. During the term of this Agreement, Bowmar will
reimburse Executive for reasonable authorized business expenses incurred on
behalf of Bowmar in accordance with Bowmar policies, as they may be amended.
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13. Assistance with Litigation. Executive shall make himself available,
upon the request of Bowmar or its counsel, to testify or otherwise assist in
litigation, arbitration or other disputes involving Bowmar during and following
the termination of this Agreement, so long as Executive receives reimbursement
for his reasonable out-of-pocket expenses. Executive will also make himself
available to the attorneys representing Bowmar for such purposes as they
reasonably deem necessary, including but not limited to, the review of
documents, discussion of the cases and preparation for trial. This Agreement is
not intended to and shall not be construed so as to in any way limit or affect
the testimony which Executive gives in any such litigation; it is understood and
agreed Executive will at all times testify fully, truthfully and accurately,
whether in deposition, trial or otherwise.
14. Arbitration. Any dispute, controversy, or claim arising out of or
relating to this Agreement or breach thereof, or arising out of or relating in
any way to the employment of Executive or the termination thereof, shall be
submitted to arbitration in Phoenix, Arizona, in accordance with the National
Rules for the Resolution of Employment Disputes of the American Arbitration
Association. Judgment upon the award rendered by the arbitrator may be entered
in any court in the State of Arizona, or in any other court of competent
jurisdiction. In reaching his or her decision, the arbitrator shall have no
authority to ignore, change, modify, add to or delete from any provision of this
Agreement, but is instead limited to interpreting this Agreement. The fees and
expenses of the arbitrator shall initially be shared equally by the parties and
the prevailing party shall be entitled to recover its fees and expenses incurred
in connection with the arbitration.
15. Governing Law. This Agreement has been entered into and shall be
interpreted in accordance with the laws of the State of Arizona.
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16. Entire Agreement. This Agreement constitutes the entire agreement
between the parties respecting the employment of Executive and there are no
representations, warranties or commitments other than those set forth herein.
This Agreement may be amended or modified only by an instrument in writing
executed by both of the parties hereto. This is an integrated agreement.
17. Effect of Agreement. This Agreement shall be binding upon the
parties and their respective heirs, executors, administrators, successors and
assigns. Executive shall not assign any rights or duties under this Agreement
without the written consent of the Bowmar Board of Directors. In the event of a
merger, sale, transfer, consolidation or reorganization involving Bowmar, this
Agreement shall continue in force and become an obligation of Bowmar or
successor entity.
18. Severability. If any provision of this Agreement as applied to
either party or to any circumstances shall be adjudged by a court or arbitration
to be void, voidable or unenforceable, the same shall in no way affect any other
provision of this Agreement. In case this Agreement, or any one or more of the
provisions hereof, shall be held to be invalid, illegal or unenforceable within
any governmental jurisdiction or subdivision thereof, this Agreement or any such
provision thereof shall not as a consequence thereof be deemed to be invalid,
illegal or unenforceable in any other governmental jurisdiction or subdivision
thereof.
19. Waiver. The waiver by either party of any term or condition of this
Agreement or any breach thereof shall not constitute a waiver of any other term
or condition or breach of this Agreement, nor shall it constitute a waiver of
the same term or condition in the future.
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20. Notices. Any notice or communication required or permitted to be
given to the parties hereto shall be delivered personally or be sent by United
States registered or certified mail, postage prepaid and return receipt
requested, and addressed or delivered as follows, or such other address as the
party addressed may be substituted by prior written notice pursuant to this
section:
(a) If to Executive: Hamid Shokrgozar
White Microelectronics/
Bowmar Instrument Corporation
3601 E. University Drive
Phoenix, AZ 85034-7217
(b) If to Bowmar: Chairman, Board of Directors
Bowmar Instrument Corporation
3601 E. University Drive
Phoenix, Arizona 85034-7217
with a copy to: Joseph T. Clees, Esq.
Bryan Cave
2800 North Central Avenue, Ste. 2100
Phoenix, Arizona 85004-1098
21. Representations by Executive. Executive represents and warrants
that he is not a party to or bound by any agreement or covenant that would
prohibit, restrict or inhibit in any way the full performance of his duties for
Bowmar under this Agreement. Executive further acknowledges that he has been
given the opportunity to consult with legal counsel regarding this Agreement.
22. Captions. Captions of this Agreement are inserted for convenience
and do not constitute a part hereof.
23. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original and all of which together shall
constitute one and the same Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement, effective
as of the day and year first written above.
BOWMAR INSTRUMENT CORPORATION
By:
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Title: Chairman of the Board
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HAMID SHOKRGOZAR
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