UNITECH TELECOM, INC.
EMPLOYMENT AND NON-COMPETITION AGREEMENT
This EMPLOYMENT AND NON-COMPETITION AGREEMENT ('Agreement'), dated as of
the 6th day of October, 1995, is entered into by and between Unitech Telecom,
Inc., a Delaware corporation ('Unitech'), and Ying Wu ('Employee').
RECITALS
A. Employee has been employed as an employee of StarCom Network Systems,
Inc., a New Jersey corporation ('StarCom'); and
B. Unitech, StarCom and certain other parties have entered into an
Agreement and Plan of Reorganization, dated as of October __, 1995, (the
'Reorganization Agreement'), which requires, among other things, that Employee
enter into this Agreement in connection with the merger of a wholly owned
subsidiary of Unitech into StarCom (the 'Merger') pursuant to which StarCom will
be the surviving corporation in the Merger and a wholly owned subsidiary of
Unitech (such surviving corporation being hereinafter referred to as 'StarCom'),
all as more fully described in the Reorganization Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED by and between the parties hereto as
follows:
1. EMPLOYMENT.
(a) EMPLOYMENT. During the Employment Term (as hereinafter defined)
Unitech hereby employs Employee as its Executive Vice President on and subject
to the terms and conditions set forth in this Agreement. Employee hereby agrees
to accept such employment, upon and subject to the terms and conditions set
forth in this Agreement. In addition, Unitech shall, subject to the Employee's
consent, cause Employee to be nominated and elected to Unitech's Board of
Directors and to StarCom's Board of Directors during the Employment Term.
(b) DUTIES. Effective upon the date hereof, Employee will perform all of
the services customarily associated with the position of Executive Vice
President during the Employment Term, including, without limitation, such
services on behalf of StarCom, subject to the policies established by and the
direction of the Board of Directors and Chief Executive Officer of Unitech.
Employee also agrees to perform such other duties and responsibilities
consistent with such position as the Board of Directors or the Chief Executive
Officer of Unitech may assign to him from time to time during the Employment
Term. During his Employment Term (as defined in subsection (c) below), Employee
shall carry out his duties
and responsibilities hereunder in a diligent and competent manner and shall
devote substantially all of his business time, attention and energy thereto.
(c) EMPLOYMENT TERM. Employee's employment hereunder (the 'Employment
Term') shall commence on the date hereof. Such employment shall be 'at will'
employment pursuant to applicable law. If Employee's employment terminates for
any reason other than (i) voluntary termination by Employee, (ii) termination as
a result of death or disability, or (iii) termination for Cause (as defined in
Section 5(a)), Employee shall be entitled to sixty (60) days notice of
termination.
(d) PLACE OF EMPLOYMENT. During the Employment Term, Employee shall
render his services at the principal executive offices of StarCom and, from time
to time as necessary, at another Unitech facility in the San Francisco Bay Area.
Employee shall do such traveling as shall be reasonably necessary in connection
with his duties and responsibilities hereunder. Employee shall not be required
to move his residence from New Jersey without Employee's consent.
(e) Employee agrees to devote substantially all of his business time,
attention and energy to the performance of his duties under this Agreement
during the Employment Term and shall perform such duties diligently, in good
faith and consistent with the best interests of Unitech. Notwithstanding the
foregoing, it is understood that the limited services to be provided to StarCom
Products, Inc. shall not be considered to be violative of this provision 1(e).
2. COMPENSATION.
(a) SALARY. During the Employment Term, Employee will receive a salary of
not less than $12,500 per month ($150,000 per annum), which shall be paid in
accordance with Unitech's normal payroll practice and shall be subject to review
based upon Unitech's normal performance review practices. Unless otherwise
specified herein, Unitech will make such deductions, withholdings and other
payments from all sums payable pursuant to this Agreement which Employee
requests or which are required by applicable law for taxes and other charges.
Unitech shall, in addition to Employee's salary, reimburse Employee for all
ordinary and necessary out-of-pocket expenses incurred by him in the performance
of his services under this Agreement, subject to and upon receipt by Unitech of
invoices or other documentation in support thereof in accordance with Unitech's
policies regarding reimbursement of expenses. Employee shall be entitled to
receive such bonus as shall be approved by the Board of Directors of Unitech in
each year during the Employment Term.
(b) BENEFIT PLANS. Employee will be entitled to participate in or receive
benefits under Unitech's or StarCom's employee benefit plans and policies as in
effect from time to time in which Employee is eligible to participate, subject
to the applicable
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terms and conditions of the particular benefit plan. These benefit plans may
include health care, life insurance, accidental death and disability, short- and
long-term disability, stock options, savings and/or bonus plans provided by,
through or on behalf of Unitech or StarCom. Unitech and/or StarCom may change,
amend, modify or terminate any benefit or bonus plan from time to time.
terms and conditions of the particular benefit plan. These benefit plans may
include health care, life insurance, accidental death and disability, short- and
long-term disability, stock options, savings and/or bonus plans provided by,
through or on behalf of Unitech or StarCom. Unitech and/or StarCom may change,
amend, modify or terminate any benefit or bonus plan from time to time.
3. CONFIDENTIALITY AND PROPRIETARY INFORMATION AGREEMENT. Concurrently
with the execution of this Agreement, Unitech and Employee will execute the
Confidentiality and Proprietary Information Agreement ('Confidentiality
Agreement') in the form attached hereto as Attachment 1.
4. COVENANT NOT TO COMPETE.
(a) NON-COMPETE. In consideration of the exchange of Unitech Common
Stock for all of the outstanding equity securities of StarCom as contemplated by
the Reorganization Agreement, Employee agrees that so long as he is an Employee
of Unitech and, in the case of Employee's termination of employment with Unitech
or StarCom, two (2) years from the date of termination, Employee will not
directly or indirectly engage in (whether as an employee, consultant,
proprietor, partner, director or otherwise), or have any ownership interest in,
or participate in the financing, operation, management or control of, any
person, firm, corporation or business that engages in a 'Restricted Business' in
a 'Restricted Territory' (as such terms are herein defined). It is agreed that
ownership of no more than 1% of the outstanding voting stock of a publicly
traded corporation shall not constitute a violation of this provision. It is
also agreed that this provision shall not apply if the Employee's termination of
employment with Unitech or StarCom is due to (i) a breach by Unitech of the
terms of this Agreement as adjudicated by a court of competent jurisdiction
(except for a failure of Unitech to pay Employee's salary as provided in Section
2(a) hereof which, for these purposes, will not require such adjudication) or
(ii) a final adjudication of Unitech as a bankrupt under any federal or state
law.
(b) NON-SOLICIT. Employee agrees that until the later to occur of
(i) the termination of Employee's agreement not to compete pursuant to
Section 4(a) above or (ii) 2 years following the termination of Employee's
employment with Unitech or StarCom, Employee shall not solicit, encourage, or
take any other action which is intended to induce any other employee of Unitech
or StarCom to terminate his employment with Unitech or StarCom.
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(c) SEVERABILITY. The parties intend that the covenants contained in
the preceding paragraphs shall be construed as a series of separate covenants,
one for each county, city, state and other political subdivision of the
Restricted Territory. Except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant contained in the
preceding paragraphs. If, in any judicial proceeding, a court shall refuse to
enforce any of the separate covenants (or any part thereof) deemed included in
said paragraphs, then such unenforceable covenant (or such part) shall be deemed
eliminated from this Agreement for the purpose of those proceedings to the
extent necessary to permit the remaining separate covenants (or portions
thereof) to be enforced by such court. It is the intent of the parties that the
covenants set forth herein be enforced to the maximum degree permitted by
applicable law.
(d) REFORMATION. In the event that the provisions of this Section 4
should ever be deemed to exceed the scope, time or geographic limitations of
applicable law regarding covenants not to compete, then such provisions shall be
reformed to the maximum scope, time or geographic limitations, as the case may
be, permitted by applicable laws.
(e) REMEDIES. The Employee hereby acknowledges that the covenants
and restrictions contained in this Section 4 are necessary for the protection
of Unitech's business and goodwill and are considered by the Employee to be
reasonable. Accordingly, the Employee hereby acknowledges and agrees that
any actual or threatened breach of any of the provisions of such Paragraph 4
may cause irreparable harm to Unitech and may not be remediable by an action
at law for damages and, therefore, Unitech shall be entitled to seek, as a
non-exclusive remedy, in any court of competent jurisdiction, all equitable
remedies therefor, including, without limitation, a temporary or permanent
injunction or specific performance of the provisions hereof, without the
necessity of showing any actual damage or that monetary damages would not
provide an adequate remedy at law or posting a bond therefor.
The Employee covenants and agrees that, if the Employee shall
violate the foregoing non-compete covenant, Unitech shall be entitled to an
accounting and repayment of all profits, compensation, commissions,
remunerations, benefits or other payments which the Employee directly or
indirectly has realized and/or may realize as a result of, growing out of or in
connection with any such violation. Such remedy shall be in addition to and not
in limitation of any injunctive relief or other rights or remedies to which
Unitech may be entitled at law or in equity or under this Agreement.
5. Employee agrees that he shall not knowingly and intentionally
interfere in any manner with the contractual or employment relationship between
Unitech or StarCom and any employee, supplier or customer of Unitech or StarCom.
6. DEFINITIONS. As used in this Agreement, the following terms shall
have the following meanings:
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(a) 'Cause' shall mean:
(i) Employee's continued failure to perform his duties and
responsibilities in good faith to the best of his ability after notice thereof
from Unitech to Employee;
(ii) Employee personally engaging in knowing and intentional
illegal conduct;
(iii) Employee being convicted of a felony, or
committing an act of dishonesty or fraud or misappropriating property;
(iv) Employee knowingly and intentionally breaching in any
material respect the terms of this Agreement or the Confidentiality Agreement;
or
(v) Employee's commencement of employment with another
employer while he is an employee of Unitech.
(b) 'Restricted Business' shall mean PHS-based wireless local loop,
optical multiplexers, and the intelligent networking business, including
products and/or services related to the StarCom Network Systems intelligent
services platform. Notwithstanding the foregoing, the Restricted Business shall
apply only to products and services relating to such businesses which are in
direct competition with Unitech and/or StarCom.
(c) 'Restricted Territory' shall mean the counties, cities and states
of the United States of America and the country of and each political
subdivision of Canada, Australia, Japan, Taiwan, People's Republic of China,
Hong Kong, Korea, Singapore, Thailand, each member nation of the European
Community or the European Free Trade Association, and all other geographic areas
throughout the world.
7. REPRESENTATIONS OF EMPLOYEE. Employee represents that:
(a) he (i) is familiar with the covenants not to compete and not to
solicit set forth in this Agreement, (ii) is fully aware of his obligations
hereunder, including, without limitation, the length of time, scope and
geographic coverage of these covenants, (iii) finds the length of time, scope
and geographic coverage of these covenants to be reasonable, and (iv) is
receiving specific, bargained-for consideration for his covenants not to compete
and not to solicit;
(b) the execution of this Agreement and the Confidentiality and
Proprietary Information Agreement, and the performance of Employee's obligations
hereunder and there-
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under, will not conflict with, or result in a violation or breach of, any
other agreement to which Employee is a party or any judgment, order or decree
to which Employee is subject.
8. ASSIGNMENT. This Agreement may not be assigned by Employee without
the written consent of Unitech. This Agreement may not be assigned by Unitech
without the written consent of Employee, except to an assignee who acquires all
or substantially all of the business of Unitech, whether by merger,
consolidation, sale of assets or otherwise. Unitech will require, as a
condition of any such assignment, that any such assignee assume and agree in
writing to perform this Agreement in the same manner and to the same extent that
Unitech would be required to perform if no such succession had taken place.
9. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement and
understanding between Employee and Unitech with respect to the subject matter
hereof, and supersedes any other negotiations, agreements, understandings,
representations or past or future practices, whether written or oral.
10. NOTICES. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing to the other party and shall
be deemed given on the date of delivery, if delivered, or five days after
mailing, if mailed first-class mail, certified, postage prepaid, to the
following addresses:
(a) If to Unitech:
Unitech Telecom, Inc.
333 Hegenberger Road, Suite 328
Oakland, CA 94621
Attention: President
with a copy to:
Wilson, Sonsini, Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304-1050
Attention: Marcia K. Sterling, Esq.
Carmen C. Chang, Esq.
(b) If to Employee:
_____________________________________
_____________________________________
_____________________________________
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(c) With a copy to:
_____________________________________
_____________________________________
_____________________________________
(or to such other address as any party hereto may designate by notice given as
herein provided).
11. GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of California without giving
effect to principles regarding conflict of laws.
12. AMENDMENTS. This Agreement shall not be changed or modified in whole
or in part except by an instrument in writing signed by each party hereto, nor
shall any covenant or provision of this Agreement be waived except by an
instrument in writing signed by the party against whom enforcement of such
waiver is sought.
13. EFFECTIVE DATE. This Agreement shall become effective upon the
Effective Time of the Merger.
14. ATTORNEYS' FEES. In the event of any legal action or proceeding to
enforce or interpret the provisions hereof, the prevailing party shall be
entitled to reasonable attorneys' fees, whether or not the proceeding results in
a final judgment.
15. COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which shall be an original, but all of which together shall constitute
one and the same agreement.
16. EFFECT OF HEADINGS. The section headings herein are for convenience
only and shall not affect the construction or interpretation of this Agreement.
17. DEFINITIONS. All capitalized terms used herein shall have the meaning
defined in the Reorganization Agreement, unless otherwise defined herein.
18. DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to either party upon any breach or default of the other
party hereto shall impair any such right, power or remedy of such non-defaulting
party, nor shall it be construed to be a waiver of any such breach or default,
nor an acquiescence therein, nor of nor in any similar breach or default
thereafter occurring; nor shall any waiver, single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring.
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19. INDEMNIFICATION. During and after the Employment Term, Unitech shall
defend, indemnify and hold Employee harmless from any claims, causes of action,
liabilities, damages, costs or expenses incurred by Employee based upon or in
connection with the performance of his services under this Agreement to the
fullest extent permitted by the laws of the State of Delaware and of the By-Laws
of Unitech (and of any such subsidiary). This provision will survive the
expiration or termination of the Employment Term.
20. BINDING EFFECT AND ASSIGNMENT. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors, heirs, personal representatives and
permitted assigns, but, except as otherwise specifically provided herein,
neither this Agreement nor any of the rights, interests or obligations of the
parties hereto may be assigned by any of the parties hereto without prior
written consent of the other.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
EMPLOYEE UNITECH TELECOM, INC.
By: /s/ Ying Wu By: /s/ Hong Liang Lu
-------------------------------- ------------------------------------
Name:
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Title: President
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** UNITECH EMPLOYMENT AND NON-COMPETITION AGREEMENT **
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Employment and Non-Competition Agreement - Unitech Telecom Inc. and Ying Wu
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