EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into
as of December 5, 1997 by and between EMCORE CORPORATION, a New Jersey
corporation ("Emcore"), and Xxxxxx Xxxxxxx (the "Executive") Emcore and the
Executive shall hereinafter collectively be referred to as the "Parties".
W I T N E S S E T H
WHEREAS, Emcore and the Executive, along with MicroOptical
Devices, Inc., a Delaware corporation ("MODE"), and certain other stockholders
of MODE, have entered into that certain Agreement and Plan of Merger of even
date herewith (the "Merger Agreement"), pursuant to which, for good and
valuable mutual consideration, MODE will merge with and into Emcore;
WHEREAS, pursuant to the Merger Agreement, the Executive will
receive 225,987 shares of common stock of Emcore in consideration for shares of
common stock, $0.001 par value per share, of MODE currently held by the
Executive;
WHEREAS, a condition to the consummation of the transactions
contemplated by the Merger Agreement, is the execution and delivery by the
Executive of this Agreement;
WHEREAS, Emcore desires to employ Executive on the terms and
conditions herein contained; and
WHEREAS, Executive is willing to enter into this Agreement
for employment with the duties outlined herein on a full-time basis;
WHEREAS, an important part of the Executive's duties will be
to develop goodwill for Emcore through personal contact with clients, employees
and others having business relations with Emcore, and there is a danger that
this goodwill, a proprietary asset of Emcore, may follow Executive when his
employment relationship with Emcore terminates.
NOW, THEREFORE, in consideration of the employment of
Executive by Emcore, Emcore and Executive agree as follows:
1. Term of the Agreement. Emcore shall employ Executive and
Executive shall accept employment with Emcore for the three (3) year period
commencing on
the date hereof (the "Commencement Date") and ending December 4, 2000 (the
"Employment Period"), subject, however, to prior termination as hereinafter
provided in Section 5. Thereafter, unless either Party provides the other
Party, no later than ninety (90) days prior to the end of the Employment
Period, with notice of its or his intention not to extend the Agreement and the
Employment Period as hereinafter set forth, this Agreement and the Employment
Period shall automatically be extended for subsequent one (1) year periods and
the provisions hereof shall remain applicable for each such subsequent period.
2. Executive's Title, Duties and Obligations. Executive shall
serve as Vice President Emcore West. Executive shall at all times report to the
President and Chief Executive Officer of Emcore, and shall be subject to the
policies established by the President and Chief Executive Officer, and the
Board of Directors, of Emcore and shall discharge his responsibilities in a
competent and faithful manner, consistent with sound business practices.
3. Devotion of Time to Emcore's Business.
a. Full-Time Efforts. During his employment with
Emcore, Executive shall devote all of his business time, attention and efforts
to the business of Emcore and MODE.
b. No Other Employment. During his employment with
Emcore, Executive shall not, whether directly or indirectly, render any
services of a commercial or professional nature to any other person or
organization, whether for compensation or otherwise, without the prior written
consent of Emcore, which shall not be unreasonably withheld, but shall be
subject to the provisions of 3(c) below.
c. Non-Competition. During his employment with
Emcore and for a period of one (1) year thereafter, Executive shall not,
directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, joint venturer, stockholder, corporate officer, director,
or in any other individual or representative capacity, (i) engage in any
business, activity or product design or development competitive with the
business of MODE, in the United States of America or any other country in which
Emcore or MODE conducted its business prior to the termination of the
Executive's employment with Emcore, or (ii) solicit, divert or take away, or
attempt to divert or to take away, the business or patronage of any of the
clients, customers or accounts which were contacted, solicited or served by
Executive while employed by Emcore or MODE. Notwithstanding anything to the
contrary set forth in this Agreement, Executive's obligations under this
Section 3.c. shall cease immediately upon (i) effective date of the termination
of this Agreement by the Employee for Good Reason (as defined in Section 5
below), (ii) the issuance of a final judgment by a court of competent
jurisdiction that Executive's employment hereunder was terminated without Good
Cause (as defined in Section 5 below) in the event that (a) the Parties are in
disagreement as to whether the Employee was terminated with or without Good
Cause and (b) Xx. Xxxxxx X. Xxxxxxxx was serving as the President and Chief
Executive
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officer of Emcore at the time of such termination, (iii) effective date of the
termination in the event that (a) the Parties are in disagreement as to whether
the Employee was terminated with or without Good Cause and (b) Xx. Xxxxxx X.
Xxxxxxxx was not serving as the President and Chief Executive Officer of Emcore
at the time of such termination or (iv) effective date of the termination of
this Agreement in the event that the Parties mutually agree that the Employee
was terminated without Good Cause.
d. Non-Solicitation of Employees. During his
employment with Emcore and for a period of one (1) year thereafter, Executive
shall not directly or indirectly, as a stockholder, investor, partner,
director, officer, employee or otherwise, (a) encourage, solicit or attempt to
induce any person employed by Emcore or MODE to terminate his or her employment
with Emcore or MODE or (b) hire or attempt to hire any person employed by
Emcore or MODE; provided, however, that this obligation shall not affect any
responsibility he may have as an employee of Emcore or MODE with respect to the
bona fide hiring and firing of Emcore personnel in the ordinary course of
business.
e. Exceptions. Notwithstanding the provisions of
this Section 3, nothing herein shall prohibit Executive from holding less than
five percent (5%) of the publicly-traded securities of any corporation.
f. Interpretation. The Parties agree that the
duration, range of activities and geographic scope of the non-competition
provision set forth in Section 3.c. are reasonable. In the event that any court
of competent jurisdiction determines that any of the duration, range of
activities or geographic scope, is unreasonable and that such provision is to
that extent unenforceable, the Parties agree that the provision shall remain in
full force and effect for the greatest time period, for the greatest number of
activities and in the greatest area that would not render it unenforceable. The
Parties intend that this non-competition provision shall be deemed to be a
series of separate covenants, one for each and every county of each and every
state of the United States of America and each and every political subdivision
of each and every country outside the United States of America where this
provision is intended to be effective.
g. Equitable Remedies. The restrictions contained in
this Section 3 are necessary for the protection of the business and goodwill of
Emcore and MODE and are considered by Executive to be reasonable for such
purpose. Executive agrees that any breach of Sections 3.b., 3.c. or 3.d. of
this Agreement is likely to cause Emcore and MODE substantial and irrevocable
damage and therefore, in the event of any such breach, Executive agrees that
Emcore, in addition to any other remedies which may be available, shall be
entitled to specific performance and other injunctive relief.
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4. Compensation and Benefits.
a. Base Compensation. During the term of this
Agreement, Emcore shall pay to Executive a base annual compensation of One
Hundred Twenty-Five Thousand Dollars ($125,000), less all required withholdings
(the "Base Salary") payable in accordance with Emcore's payroll policies.
Executive shall receive annual merit reviews and shall be considered for annual
raises based thereon. Parties will negotiate, in good faith, prior to end of
the Employment Period an increase to Executive's base salary effective as of
the first day of the first renewal period.
b. Performance Bonuses. Executive shall be entitled
to receive annual bonuses, payable no later than ninety (90) days after the end
of the applicable [calendar] [fiscal] year, up to an amount equal to fifty
percent (50%) of the Executive's Base Salary based upon the achievement of
certain performance objectives, as agreed upon in good faith by Emcore and the
Executive (the "Performance Bonus").
c. Benefits. During his employment with Emcore,
Executive will be entitled to receive all such health, medical, dental, life
insurance, disability insurance, stock grants, stock options and all other
benefits, as are provided to other executive officers of Emcore. Emcore
reserves the right to modify, amend or terminate any benefits listed above at
any time for any reason (provided such modification, amendment or termination
is applicable to all executives receiving such benefits) but shall, in any
case, provide reasonable health and disability benefits to Executive while
Executive is a full-time employee of Emcore. Further, Executive will have the
rights to participate in any vacation and savings plans implemented by Emcore
which are provided to other executive officers of Emcore.
d. Expense Reimbursement. Executive shall be
entitled to reimbursement from Emcore for all customary, ordinary and necessary
business expenses incurred by him in the performance of his duties hereunder,
provided that Executive shall furnish Emcore with reasonable and customary
vouchers, receipts and other details of such expenses within thirty (30) days
after they are incurred.
5. Termination of Employment.
a. Termination for Good Cause. Emcore may terminate
Executive's employment at any time for Good Cause as determined by the
President of Emcore, acting in good faith. For the purposes of this Agreement,
"Good Cause" shall mean gross misconduct, gross neglect of duties, acts
involving moral turpitude, material breach by Executive of Sections 3, 6, 7 or
8 of this Agreement, material breach by Executive of the terms of this
Agreement, any act or omission involving fraud, embezzlement, breach of
fiduciary duty, or misappropriation of any property or proprietary information
of Emcore or MODE by Executive. If Executive's employment is terminated by
Emcore with Good Cause, Executive shall be entitled to receive any unpaid
compensation accrued, and business
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expenses incurred (as set forth in to Section 4.d.), through the last day of
Executive's employment.
b. Termination without Good Cause. If Executive's
employment is terminated by Emcore without Good Cause, Executive shall be
entitled to receive (i) any unpaid compensation accrued, and business expenses
incurred (as set forth in Section 4.d.), through the last day of Executive's
employment, (ii) severance payments equal to his base compensation, payable on
Emcore's normal payroll dates, during the Employment Period, (iii) continuation
of medical, health, life insurance and disability insurance during the
Employment Period and (iv) acceleration of such number of options that would
have become vested and exercisable during the Employment Period (the "Severance
Payments").
c. Termination by Executive. Executive may terminate
this Agreement at any time, upon ninety (90) days' written notice to Emcore. If
Executive terminates this Agreement under this Section 5.c. with Good Reason,
Executive shall be entitled to receive the Severance Payments in accordance
with Section 5.b. above. If Executive terminates this Agreement under this
Section 5.c. without Good Reason, Executive shall only be entitled to any
unpaid compensation accrued, and business expenses incurred (as set forth in
Section 4.d.), through the last day of Executive's employment. For purposes of
this Agreement, "Good Reason" shall mean (a) material breach by Emcore or its
successor of the terms of the this Agreement, (b) material diminution in
Executive's duties and/or responsibilities hereunder, (c) termination of this
Agreement under Section 5.d. due to Executive becoming mentally or physically
Disabled (as defined in Section 5.d), or (d) requiring Executive to relocate
more than fifty (50) miles from Albuquerque, New Mexico.
d. Death or Disability. This Agreement shall
terminate if Executive dies or is mentally or physically Disabled. For the
purposes of this Agreement, "Disabled" shall mean a mental or physical
condition that renders Executive incapable of performing his duties and
obligations under this Agreement for three (3) or more consecutive months or
for a total of six (6) months during any twelve (12) consecutive months,
certified in writing by a physician mutually acceptable to the Parties. If this
Agreement is terminated under this Section 5.d., Executive or his estate shall
be entitled to any unpaid compensation accrued through the last day of
Executive's employment.
6. Nondisclosure and Nonuse of Confidential Information.
(a) Executive will not disclose or use at any time, either
during his or her employment with Emcore or for the next ten years thereafter,
any Confidential Information of which Executive is or becomes aware, whether or
not such information is developed by him or her, except to the extent that such
disclosure or use is directly related to and required by Executive's
performance of duties assigned to Executive by Emcore. Executive will take all
appropriate steps to safeguard Confidential Information and to protect it
against disclosure, misuse, copying, loss and theft.
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(b) As used in this Agreement, the term "Confidential
Information" shall mean information that is not generally known to the public
and that is used, developed or obtained by Emcore and/or MODE in connection
with their respective businesses, including but not limited to (i) products or
services, (ii) fees, costs and pricing structures, (iii) designs, (iv)
analysis, (v) drawings, photographs and reports, (vi) computer software,
including operating systems, applications and program listings, (vii) flow
charts, manuals and documentation, (viii) data bases, (ix) accounting and
business methods, (x) inventions, devices, new developments, methods and
processes, whether patentable or unpatentable and whether or not reduced to
practice, (xi) customers and clients and customer or client lists, (xii) other
copyrightable works, (xiii) all technology and trade secrets and (xiv) all
similar and related information in whatever form. Notwithstanding the
following, Confidential Information will not include (i) any information that
has been published in a form generally available to the public prior to the
date Executive proposes to disclose or use such information or (ii) information
that is widely known within Emcore's and/or MODE's industry, as applicable,
although not generally known to the public. Information will not be deemed to
have been published merely because individual portions of the information have
been separately published, but only if all material features comprising such
information have been published in combination.
7. Emcore's Ownership of Intellectual Property.
(a) In the event that Executive as part of his activities on
behalf of Emcore generates, authors or contributes to any invention, design,
new development, device, product, method or process (whether or not patentable
or reduced to practice or comprising Confidential Information), any
copyrightable work (whether or not comprising Confidential Information) or any
other form of Confidential Information relating directly or indirectly to
Emcore's business as now or hereinafter conducted (collectively, "Intellectual
Property"), Executive acknowledges that such Intellectual Property is the
exclusive property of Emcore and hereby assigns all right, title and interest
in and to such Intellectual Property to Emcore or its designees. Any
copyrightable work prepared in whole or in part by Executive will be deemed "a
work made for hire" under Section 201(b) of the 1976 Copyright Act, and Emcore
or its designees will own all of the rights comprised in the copyright therein.
Executive will promptly and fully disclose all Intellectual Property to Emcore
and will cooperate with Emcore to protect Emcore's interests in and rights to
such Intellectual Property (including, without limitation, providing reasonable
assistance in securing patent protection and copyright and trademark
registrations, in the defense in any judicial opposition or other proceeding in
respect of such registrations, and executing all documents as reasonably
requested by Emcore, whether such requests occur prior to or after termination
of Executive's employment with Emcore). In the event Emcore is unable, after
reasonable effort, to secure Executive's signature on any application for
letters patent, copyright or trademark registration or other documents
regarding any legal protection relating to Intellectual Property, whether
because of Executive's physical or mental incapacity or for any other reason
whatsoever, Executive hereby irrevocably designate and appoint Emcore
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and its duly authorized officers and agents as his agent and attorney-in-fact,
to act for and in Executive's behalf and stead to execute and file any such
application or applications or other documents and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent,
copyright or trademark registrations or any other legal protection thereon with
the same legal force and effect as if executed by Executive.
(b) Section 7(a) of this Agreement regarding Emcore's
ownership of Intellectual Property shall not apply to any invention for which
no equipment, supplies, facilities or trade secret information of Emcore was
used and which was developed entirely on Executive's own time, unless (i) the
invention relates to the business of Emcore or to Emcore's actual or
demonstrably anticipated research or development or (ii) the invention results
from any work performed by Executive for Emcore.
(c) Executive has attached hereto a complete list of
inventions which have been made or conceived or first reduced to practice by
Executive alone or jointly with others prior to Executive's employment with
Emcore which Executive desires to remove from the operation of this Agreement.
If no such list is attached to this Agreement, Executive represents that
Executive has not made, conceived or reduced to practice any such inventions
and improvements at the time of signing this Agreement.
8. Delivery of Materials Upon Termination of Employment. As
requested by Emcore from time to time and upon the termination of Executive's
employment with Emcore for any reason, Executive will promptly deliver to
Emcore upon request all copies and embodiments, in whatever form, of all
Confidential Information or Intellectual Property in Executive's possession or
within his or her control (including, but not limited to, written records,
notes, photographs, manuals, notebooks, documentation, program listings, flow
charts, magnetic media disks, diskettes, tapes and all other materials
containing any Confidential Information or Intellectual Property) irrespective
of the location or form of such material and, if requested by Emcore, will
provide Emcore with written confirmation that all such materials have been
delivered to Emcore.
9. Miscellaneous.
a. Representations and Agreements of Executive.
Executive represents and warrants that he is free to enter into this Agreement
and to perform the duties required hereunder, and that there are no employment
contracts or understandings, restrictive covenants or other restrictions,
whether written or oral, preventing the performance of his duties hereunder.
Executive further represents and warrants that he does not possess any
proprietary information with respect to any former employer which is subject to
an agreement or understanding, whether written or oral, between Executive and
such former employer which restricts Executive's use or disclosure of such
proprietary information.
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b. Governing Law. This Agreement shall be
interpreted, construed, governed and enforced according to the laws of the
State of New Mexico.
c. Amendments. No amendment or modification of the
terms or conditions of this Agreement shall be valid unless in writing and
signed by the parties hereto.
d. Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be construed, if possible, so as to be enforceable under applicable law,
else, such provision shall be excluded from this Agreement and the balance of
the Agreement shall be interpreted as if such provision were so excluded and
shall be enforceable in accordance with its terms.
e. Successors and Assigns. The rights and
obligations of Emcore under this Agreement shall inure to the benefit of and
shall be binding upon the successors and assigns of Emcore. Executive shall not
be entitled to assign any of his rights or obligations under this Agreement.
f. Non-Waiver. The waiver of any term or condition
of this Agreement shall not be deemed to constitute a waiver of any other term
or condition.
g. Notices. All notices required or permitted under
this Agreement shall be in writing and shall be deemed effective upon personal
delivery or two days after deposit in the United States Post Office, by
registered or certified mail, postage prepaid, addressed to the other party at
the address shown below such party's signature, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 5.h.
h. Entire Agreement. This Agreement, including the
exhibits attached hereto, constitutes the entire agreement between the parties
with respect to the matters contained herein and shall supercede all prior
agreements by and between Executive and MODE relating to the matters contained
herein.
i. Headings. The Section headings appearing in this
Agreement are for purposes of easy reference and shall not be considered a part
of this Agreement or in any way modify, amend, or affect its provisions.
j. Expenses. Emcore shall reimburse Executive for
all reasonable legal fees and related out-of-pocket expenses incurred by
Executive in enforcing his rights hereunder.
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IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date set forth above.
EMCORE CORPORATION
/s/ Xxxxxx X. Xxxxxxxx, Xx.
-----------------------------------------
By:
Title:
Address:
EXECUTIVE:
/s/ Xxxxxx Xxxxxxx
-----------------------------------------
Xxxxxx Xxxxxxx
Address:
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