Employment Agreement - Western Multiplex Corp. and Ihab Abu-Hakima
EMPLOYMENT AGREEMENT (the "Agreement") dated as of March 29, 2001
by and between Western Multiplex Corporation, a Delaware corporation (the
"Company") and Ihab Abu-Hakima (the "Executive").
WHEREAS, the Company considers it essential to its best interests
and the best interests of its stockholders to foster the continued employment of
Executive by the Company and Executive is willing to accept and continue
Executive's employment on the terms hereinafter set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein and for other good and valuable consideration, the parties
agree as follows:
1. Term of Employment; Executive Representation.
a. Employment Term. Executive's term of employment under
this Agreement shall commence on the date hereof and, subject to the terms
hereof, Executive and the Company agree and acknowledge that Executive's
employment with the Company constitutes "at-will" employment and that this
Agreement may be terminated at any time by the Company or Executive, subject to
the terms of Section 7 of this Agreement.
b. Executive Representation. Executive hereby represents
to the Company that the execution and delivery of this Agreement by Executive
and the Company and the performance by Executive of the Executive's duties
hereunder shall not constitute a breach of, or otherwise contravene, the terms
of any statute, law, regulation, or of any employment agreement or other
agreement or policy to which Executive is a party or otherwise bound.
a. While employed hereunder, Executive shall serve as the
Company's Vice-President, Business Development. In such position, Executive
shall have such duties and authority as shall be determined from time to time by
the chief executive officer of the Company (the "CEO").
b. While employed hereunder, Executive will devote
Executive's full business time and best efforts to the performance of
Executive's duties hereunder and will not engage in any other business,
profession or occupation for compensation or otherwise which would conflict with
the rendition of such services either directly or indirectly, without the prior
written consent of the CEO.
3. Base Salary. While employed hereunder, the Company shall pay
Executive a base salary (the "Base Salary") at the annual rate of $160,000,
payable in regular installments in accordance with the Company's usual payment
practices. Executive shall be entitled to such increases in Executive's Base
Salary, if any, as may be determined from time to
time in the sole discretion of the CEO or the board of directors of the Company
(the "Board"), as applicable.
4. Annual Bonus. With respect to each calendar year while
employed hereunder, Executive shall be eligible to earn an annual bonus award
(an "Annual Bonus") pursuant to an annual incentive plan to be established by
the Board; provided, however, that with respect to fiscal year 2001, Executive's
target Annual Bonus shall be equal to 40 percent of his then Base Salary.
5. Employee Benefits. The Company shall provide Executive during
the term of his employment hereunder with coverage under all employee pension
and welfare benefit programs, plans and practices in accordance with the terms
thereof, which the Company generally makes available to its senior executives.
In each calendar year, Executive shall also be entitled to two weeks' paid
vacation, and such number of days of sick leave as established under the
Company's policies as in effect from time to time, which shall be taken at such
times as are consistent with Executive's responsibilities hereunder.
6. Business Expenses. Executive is authorized to incur reasonable
expenses in carrying out his duties and responsibilities under this Agreement,
including, without limitation, expenses for travel and similar items related to
such duties and responsibilities. The Company will reimburse Executive for all
such expenses upon presentation by Executive from time to time of appropriately
itemized and approved (consistent with the Company's policy) accounts of such
7. Termination. The Executive's employment hereunder may be
terminated by either party at any time and for any reason; provided that
Executive will be required to give the Company at least 90 days advance written
notice of any resignation of Executive's employment (unless the Company waives
its right to receive such 90-day notice). Notwithstanding any other provision of
this Agreement, the provisions of this Section 7 shall exclusively govern
Executive's rights upon termination of employment with the Company and its
a. By the Company For Cause; By the Executive Without Good
(i) The Executive's employment hereunder may be terminated
by the Company for Cause (as defined below) at any time or by Executive without
Good Reason after 90 days prior written notice (unless the Company waives such
(ii) For purposes of this Agreement, "Cause" shall mean
(i) Executive's continued failure substantially to perform Executive's duties
hereunder (other than as a result of total or partial incapacity due to physical
or mental illness) for a period of 10 days following notice by the Company to
the Executive of such failure, (ii) dishonesty in the performance of Executive's
duties hereunder, (iii) an act or acts on Executive's part constituting (x) a
felony under the laws of the United States or any state thereof or (y) a
misdemeanor involving moral turpitude, (iv) Executive's willful malfeasance or
willful misconduct in connection with
Executive's duties hereunder or any act or omission which is materially
injurious to the financial condition or business reputation of the Company or
any of its subsidiaries or affiliates or (v) Executive's breach of the
provisions of Section 8 of this Agreement.
(iii) If Executive's employment is terminated by the
Company for Cause or by Executive without Good Reason, Executive shall be
entitled to receive:
(A) the Base Salary through the date of termination;
(B) any Annual Bonus earned but unpaid as of the date of
termination for any previously completed calendar year;
(C) reimbursement for any unreimbursed business expenses
properly incurred by Executive in accordance with Company policy
prior to the date of Executive's termination; and
(D) such Employee Benefits, if any, as to which Executive
may be entitled under the employee benefit plans of the Company
(the amounts described in clauses (A) through (D) hereof being
referred to as the "Accrued Rights").
Following such termination of Executive's employment by the
Company for Cause or by Executive without Good Reason, except as set forth in
this Section 7(a), Executive shall have no further rights to any compensation or
any other benefits under this Agreement.
b. Disability or Death.
(i) The Executive's employment hereunder shall terminate
upon Executive's death and if Executive becomes physically or mentally
incapacitated and is therefore unable for a period of six (6) consecutive months
or for an aggregate of nine (9) months in any twenty-four (24) consecutive month
period to perform Executive's duties (such incapacity is hereinafter referred to
as "Disability"). Any question as to the existence of the Disability of
Executive as to which Executive and the Company cannot agree shall be determined
in writing by a qualified independent physician mutually acceptable to Executive
and the Company. If Executive and the Company cannot agree as to a qualified
independent physician, each shall appoint such a physician and those two
physicians shall select a third who shall make such determination in writing.
The determination of Disability made in writing to the Company and Executive
shall be final and conclusive for all purposes of the Agreement.
(ii) Upon termination of Executive's employment hereunder
for either Disability or death, Executive or Executive's estate (as the case may
be) shall be entitled to receive:
(A) the Accrued Rights; and
(B) a pro rata portion of any Annual Bonus that the
Executive would have been entitled to receive pursuant to Section
4 hereof in such year based upon the percentage of the calendar
year that shall have elapsed through the date of
Executive's termination of employment, payable when such Annual
Bonus would have otherwise been payable had the Executive's
employment not terminated.
Following Executives termination of employment due to death or
Disability, except as set forth in this Section 7(b), Executive shall have no
further rights to any compensation or any other benefits under this Agreement.
c. By the Company Without Cause or Resignation by
Executive for Good Reason.
(i) The Executive's employment hereunder may be terminated
by the Company without Cause or by Executive's resignation for
(ii) For purposes of this Agreement, "Good Reason" shall
(x) the reduction by the Company of Executive's Base
Salary (other than as a result of a general salary reduction affecting all
Company employees); or
(y) any substantial and sustained diminution in
Executive's authority or responsibilities from those described in Section 2
Notwithstanding the foregoing, none of the events described in clauses (x) or
(y) of this Section 7(c)(ii) shall constitute Good Reason unless Executive shall
have notified the Company in writing describing the events which constitute Good
Reason and then only if the Company shall have failed to cure such event within
thirty (30) days after the Company's receipt of such written notice.
(iii) If Executive's employment is terminated by the
Company without Cause (other than by reason of death or Disability) or if
Executive resigns for Good Reason, Executive shall be entitled to receive:
(A) the Accrued Rights; and
(B) subject to Executive's continued compliance with the
provisions of Section 8, continued payment of the Base Salary
until twelve (12) months after the date of such termination;
provided that the aggregate amount described in this clause (B)
shall be reduced by the present value of any other cash severance
or termination benefits payable to Executive under any other
plans, programs or arrangements of the Company or its affiliates.
Following Executive's termination of employment by the Company
without Cause (other than by reason of Executive's death or Disability) or by
Executive's resignation for Good Reason, except as set forth in this Section
7(c), Executive shall have no further rights to any compensation or any other
benefits under this Agreement.
d. Notice of Termination. Any purported termination of
employment by the Company or by Executive (other than due to Executive's death)
shall be communicated by
written Notice of Termination to the other party hereto in accordance with
Section 10(h) hereof. For purposes of this Agreement, a "Notice of Termination"
shall mean a notice which shall indicate the specific termination provision in
this Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of employment under
the provision so indicated.
8. Nondisclosure of Confidential Information; Non-Competition.
(a) At any time during or after Executive's employment with the Company,
Executive shall not, without the prior written consent of the Company, use,
divulge, disclose or make accessible to any other person, firm, partnership,
corporation or other entity any Confidential Information (as hereinafter
defined) pertaining to the business of the Company or any of its subsidiaries,
except (i) while employed by the Company, in the business of and for the benefit
of the Company, or (ii) when required to do so by a court of competent
jurisdiction, by any governmental agency having supervisory authority over the
business of the Company, or by any administrative body or legislative body
(including a committee thereof) with jurisdiction to order Executive to divulge,
disclose or make accessible such information. For purposes of this Section 8(a),
"Confidential Information" shall mean non-public information concerning the
financial data, strategic business plans, and other non-public, proprietary and
confidential information of the Company, its subsidiaries, Ripplewood Holdings
L.L.C. or their respective affiliates as in existence as of the date of
Executive's termination of employment that, in any case, is not otherwise
available to the public (other than by Executive's breach of the terms hereof).
(b) As Vice-President, Business Development, Executive will
acquire knowledge of Confidential Information and trade secrets. Executive
acknowledges that the Confidential Information and trade secrets which the
Company has provided and will provide to him could play a significant role were
he to directly to indirectly be engaged in any business in Competition with the
Company or its subsidiaries. During the period of his employment hereunder and
for one year thereafter, Executive agrees that, without the prior written
consent of the Company, (A) he will not, directly or indirectly, either as
principal, manager, agent, consultant, officer, stockholder, partner, investor,
lender or employee or in any other capacity, carry on, be engaged in or have any
financial interest in (other than an ownership position of less than 5 percent
in any company whose shares are publicly traded), any business, which is in
Competition (as hereinafter defined) with the existing business of the Company
or its subsidiaries and (B) he shall not, on his own behalf or on behalf of any
person, firm or company, directly or indirectly, solicit or offer employment to
any person who has been employed by the Company or its subsidiaries at any time
during the 12 months immediately preceding such solicitation to the extent that
Executive would use or inevitably use Confidential Information or trade secrets
or that would otherwise constitute unfair competition.
(c) For purposes of this Section 8, a business shall be deemed to
be in Competition with the Company or its subsidiaries if it is engaged in or
has taken concrete steps toward engaging in the business of research and
development, designing, manufacturing, marketing, distributing, or servicing or
selling components as used in microwave radios, products and equipment, whether
in existence or in development, relating to microwave communications (including
unlicensed spread spectrum radio, licensed microwave radio,
wireless ethernet bridge, and fixed wireless (e.g., wireless local loop,
point-to-point, point-to-multipoint)), as carried on by the Company or its
affiliates as of the date of Executive's termination of employment, in all
cities, counties, states and countries in which the business of the Company or
its affiliates is then being conducted or its products are being sold.
(d) The results and proceeds of Executive's services hereunder,
including, without limitation, any works of authorship resulting from
Executive's services during Executive's employment with the Company and/or any
of the Company's affiliates and any works in progress, will be works-made-for
hire and the Company will be deemed the sole owner throughout the universe of
any and all rights of whatsoever nature therein, whether or not now or hereafter
known, existing, contemplated, recognized or developed, with the right to use
the same in perpetuity in any manner the Company determines in its sole
discretion without any further payment to Executive whatsoever. If, for any
reason, any of such results and proceeds will not legally be a work-for-hire
and/or there are any rights which do not accrue to the Company under the
preceding sentence, then Executive hereby irrevocably assigns and agrees to
assign any and all of Executive's right, title and interest thereto, including,
without limitation, any and all copyrights, patents, trade secrets, trademarks
and/or other rights of whatsoever nature therein, whether or not now or
hereafter known, existing, contemplated, recognized or developed, to the
Company, and the Company will have the right to use the same in perpetuity
throughout the universe in any manner the Company determines without any further
payment to Executive whatsoever. Executive will, from time to time as may be
requested by the Company, (i) during the term of Executive's employment without
further consideration, and (ii) thereafter at Executive's then current hourly
rate, do any and all things which the Company may deem useful or desirable to
establish or document the Company's exclusive ownership of any and all rights in
any such results and proceeds, including, without limitation, the execution of
appropriate copyright and/or patent applications or assignments. To the extent
Executive has any rights in the results and proceeds of Executive's services
that cannot be assigned in the manner described above, Executive unconditionally
and irrevocably waives the enforcement of such rights. This subsection is
subject to and will not be deemed to limit, restrict, or constitute any waiver
by the Company of any rights of ownership to which the Company may be entitled
by operation of law by virtue of the Company being Executive's employer. This
Section does not apply to an invention that qualifies as a nonassignable
invention Section 2870 of the California Labor Code, which applies to any
invention for which no equipment, supplies, facilities or Confidential
Information was used, which does not (i) relate to the business of the Company;
(ii) relate to the Company's actual or demonstrable anticipated research or
development or (iii) result from any work performed by Executive for the
Company. This confirms that Executive has been notified of his rights under
Section 2870 of the California Labor Code.
(e) Executive and the Company agree that the covenants contained
in this Section 8 are reasonable under the circumstances, and further agree that
if in the opinion of any court of competent jurisdiction such restraint is not
reasonable in any respect, such court shall have the right, power and authority
to excise or modify such provision or provisions of this covenant as to the
court shall appear not reasonable and to enforce the remainder of the covenant
as so amended. Executive agrees that any breach of the covenants contained in
this Section 8 would irreparably injure the Company. Accordingly, Executive
agrees that the Company may, in
addition to pursuing any other remedies it may have in law or in equity, cease
making any payments otherwise required by this Agreement and obtain an
injunction against Executive from any court having jurisdiction over the matter
restraining any further violation of this Agreement by Executive.
9. Specific Performance. Executive acknowledges and agrees that
the Company's remedies at law for a breach or threatened breach of any of the
provisions of Section 8 would be inadequate and, in recognition of this fact,
Executive agrees that, in the event of such a breach or threatened breach, in
addition to any remedies at law, the Company, without posting any bond, shall be
entitled to cease making any payments or providing any benefit otherwise
required by this Agreement and obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or
any other equitable remedy which may then be available.
a. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without regard
to conflicts of laws principles thereof.
b. Entire Agreement/Amendments. This Agreement contains
the entire understanding of the parties with respect to the employment of
Executive by the Company. There are no restrictions, agreements, promises,
warranties, covenants or undertakings between the parties with respect to the
subject matter herein other than those expressly set forth herein. This
Agreement may not be altered, modified, or amended except by written instrument
signed by the parties hereto. This Agreement supercedes all prior agreements and
understandings (including verbal agreements) between Executive and the Company
and/or its affiliates regarding the terms and conditions of Executive's
employment with the Company and/or its affiliates (collectively, the "Prior
c. No Waiver. The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be considered
a waiver of such party's rights or deprive such party of the right thereafter to
insist upon strict adherence to that term or any other term of this Agreement.
d. Severability. In the event that any one or more of the
provisions of this Agreement shall be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not be affected thereby.
e. Assignment. This Agreement shall not be assignable by
Executive. This Agreement may be assigned by the Company to a company which is a
successor in interest to substantially all of the business operations of the
Company. Such assignment shall become effective when the Company notifies the
Executive of such assignment or at such later date as may be specified in such
notice. Upon such assignment, the rights and obligations of the Company
hereunder shall become the rights and obligations of such successor company,
provided that any assignee expressly assumes the obligations, rights and
privileges of this Agreement.
f. Mitigation. Executive shall be required to mitigate the
amount of any payment provided for pursuant to this Agreement by seeking other
employment, taking into account the provisions of Section 8 of this Agreement.
Anything in this Agreement to the contrary notwithstanding, in the event that
Executive provides services for pay to anyone other than the Company or any of
its affiliates from the date Executive's employment hereunder is terminated
until twelve months thereafter, the amounts paid to Executive during such period
pursuant to this Agreement shall be reduced by the amounts of salary, bonus or
other compensation earned by Executive during such period as a result of
Executive's performing such services (regardless of when such earned amounts are
actually paid to Executive).
g. Successors; Binding Agreement. This Agreement shall
inure to the benefit of and be binding upon personal or legal representatives,
executors, administrators, successors, heirs, distributes, devises and legatees.
h. Notice. For the purpose of this Agreement, notices and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered or mailed by United
States registered mail, return receipt requested, postage prepaid, addressed to
the respective addresses set forth below Agreement, or to such other address as
either party may have furnished to the other in writing in accordance herewith,
except that notice of change of address shall be effective only upon receipt.
If to the Company:
Western Multiplex Corporation
1196 Borregas Ave.
Sunnyvale, California 94089
Attention: Vice President, Human Resources
If to Executive:
To the most recent address of Executive set forth in the personnel
records of the Company.
i. Withholding Taxes. The Company may withhold from any
amounts payable under this Agreement such Federal, state and local taxes as may
be required to be withheld pursuant to any applicable law or regulation.
j. Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
[Signatures on next page]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
WESTERN MULTIPLEX CORPORATION
By: /s/ Christina Rulo
Name: Christina Rulo
Title: Vice President of Human Resources
/s/ Ihab Abu-Hakima