Exhibit 10.5
EMPLOYMENT
AGREEMENT
This Employment Agreement (this
“ Agreement ”) is made and entered into
effective as of the Initial Closing date set forth in the Share
Exchange Agreement dated October 24, 2008 by and between
Trans-India Acquisition Corporation, a Delaware corporation
(“TIL”), Solar Semiconductor Ltd., a Cayman Islands
company (“Solar Cayman”), Solar Semiconductor Private
Limited, a company formed under the laws of the Republic of India,
Solar Semiconductor, Inc., a California corporation, certain of
Solar Cayman’s stockholders, and the Stockholder’s
Representative (the “Exchange Agreement”) (the “
Effective Date ”) by and between TIL and Hari
Surapaneni (the “ Executive ”). TIL, together
with any parent or subsidiaries of TIL, are herein referred to as
the “ Company ”, and all such companies other
than TIL are herein referred to as the “ Related
Companies .”
WHEREAS , the Board of Directors of TIL (the “
Board ”) believes that it is in the best interests of
the Company and its stockholders to provide Executive with an
incentive to continue his employment.
NOW, THEREFORE
, In consideration of the mutual
covenants contained herein and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. Position and
Responsibilities . The Company hereby confirms
Executive’s position as President and Chief Executive Officer
of TIL. The Executive agrees to assume and discharge such
responsibilities as are commensurate with such position and as the
Board may direct. The Executive agrees to devote the necessary
time, skill and attention to the Executive’s duties and
responsibilities, and agrees to perform them faithfully, diligently
and competently. In addition, the Executive agrees to comply with
and be bound by the operating policies, procedures and practices of
the Company in effect from time to time during the
Executive’s employment. Nothing herein is intended to
restrict Executive from owning, directly or indirectly, any class
of securities of any other business entity, or from serving as a
director on the board of any other business entity; provided,
however, that Executive will not hold any interest in a private
company or more than one percent of the stock of any public company
which private or public company is in competition directly or
indirectly with the Company, as reasonably determined by the Board,
nor serve on the board of any business entity, which is in
competition, directly or indirectly with the Company, as reasonably
determined by the Board; and, provided further, that,
notwithstanding any provision of this Section 1, Executive
shall not be required to divest himself of any securities he
currently holds, directly or indirectly, nor be required to
terminate his service as a board member of any company or business
entity.
2. Compensation .
Executive will receive an annual salary of $300,000 ,
which will be paid semi-monthly in accordance with the
Company’s normal payroll procedures. Executive will be
eligible to receive aggregate annual bonuses equal to the product
of one hundred percent (100%) of Executive’s then annual
salary and a multiplier determined in accordance with a management
bonus plan which the Company will implement as soon as reasonably
practicable following the execution of this Agreement. Bonuses will
be evaluated and paid on no less than a semi-annual basis for the
six months ending March and September, commencing with the
six-months ending March 2009.
3. Other Benefits .
Executive will be entitled to receive the standard employee
benefits made available by the Company to its employees to the full
extent of Executive’s eligibility for such benefits. During
Executive’s employment, Executive shall be permitted, to the
extent eligible, to participate in any group medical, dental, life
insurance and disability insurance plans or similar benefit plan of
the Company that is available to employees generally. Participation
in any such plans shall be consistent with Executive’s rate
of compensation to the extent that compensation is a determinative
factor with respect to coverage under any such plan. Executive will
be allowed four (4) weeks of vacation each year plus all
recognized United States and Indian holidays. The Company shall
reimburse Executive for all reasonable expenses actually incurred
or paid by Executive in the performance of Executive’s
services on behalf of the Company, upon prior authorization and
approval in accordance with the Company’s then-current
written expense reimbursement policy as in effect from time to
time. In addition, Executive shall be entitled to reimbursement of
expenses commensurate with other similarly situated executives,
including but not limited to a chauffeur while in India, and a golf
club or country club membership, as appropriate. Executive will be
entitled to reimbursement for travel expenses in accordance with
Company policy, or for business class travel, at his
option.
4. Stock . In
connection with Executive’s previous employment with Solar
Cayman, Executive received an option to purchase Solar
Cayman’s Ordinary Shares, which option was exchanged pursuant
to the terms of the Exchange Agreement for an option to purchase
shares of TIL common stock on the same terms as the original option
to purchase Solar Cayman’s Ordinary Shares. Such TIL option
grant shall be subject to the terms and conditions of TIL’s
2008 Stock Option Plan and shall be designated as a nonstatutory
stock option for U.S. tax law purposes.
5. At-Will Employment
. The Company and Executive acknowledge that Executive’s
employment with TIL and/or any of the Related Companies is and will
continue to be at-will, as defined under applicable law.
Accordingly, any of Executive, TIL or any of the Related Companies
may terminate Executive’s employment relationship at any time
for any reason, with or without cause. If Executive’s
employment with TIL or any of the Related Companies terminates for
any reason, Executive will not be entitled to any severance
payments, stock vesting, or other benefits, damages, awards or
compensation other than as provided for in this
Agreement.
6. Severance Benefits
.
(a) Involuntary Termination
.
(i) Severance Payments . If,
at any time, (1) Executive terminates his employment with the
Company for Good Reason or (2) the Company terminates
Executive’s employment without Cause, then, subject to
Section 6(b) below, Executive will be entitled to receive
severance pay (less applicable withholding taxes) from the first
regular payroll date following the effective date of the Release
(as defined below) in accordance with the Company’s regular
payroll practices, for a period of forty-eight (48) months
minus the number of months from the Effective Date until the date
of Executive’s termination (the “Severance
Period”). The total severance payment will be equivalent to
Executive’s monthly base salary (as in effect immediately
prior to Executive’s termination), less applicable
withholding, for a period of forty-eight (48) months minus the
number of months from the Effective Date until the date of
Executive’s termination.
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(ii) Equity . If, at any
time, (a) Executive terminates his employment with the Company
for Good Reason or (b) the Company terminates
Executive’s employment without Cause, then, subject to
Section 6(b) below, all of Executive’s then outstanding
equity awards, including without limitation stock options and
restricted stock, shall immediately become fully vested and, if
applicable, exercisable as of the effective date of the Release (as
defined below).
(b) Release of Claims
Agreement . The receipt of any severance pay, equity award
vesting or other employee benefits pursuant to Section 6(a)
above will be subject to Executive signing and not revoking a
release of claims agreement with the Company in a form provided by
the Company and acceptable to Executive, which acceptance shall not
be unreasonably withheld (the “Release”). No severance
pay, equity award vesting or other benefits will be provided until
the Release becomes effective.
(c) Voluntary Resignation;
Termination For Cause . If Executive’s employment with
the Company terminates (i) voluntarily by Executive (except
upon a termination for Good Reason) or (ii) for Cause by the
Company, then Executive will not be entitled to receive severance
or other benefits except for those (if any) as may then be
established under other written agreements with TIL (or any of the
Related Companies).
(d) Disability; Death
.
(i) If, within the first two
(2) years following the Effective Date, the Company terminates
Executive’s employment as a result of Executive’s
Disability, or Executive’s employment terminates due to his
death, then neither Executive nor his estate will be entitled to
receive severance or other benefits except for those (if any) as
may then be established under the Company’s then existing
written severance and benefits plans and practices or pursuant to
other written agreements with the Company. However, if Executive
has already begun to receive severance payments pursuant to
Section 6(a) and if Executive should die before all amounts
have been paid, such unpaid amounts will be paid in a lump-sum
payment (less any withholding taxes) to Executive’s
designated beneficiary, if living, or otherwise to the personal
representative of Executive’s estate.
(ii) If, within the period from two
(2) years following the Effective Date until four
(4) years following the Effective date, the Company terminates
Executive’s employment as a result of Executive’s
Disability, or Executive’s employment terminates due to his
death, then Executive or his estate, as applicable, will be
entitled to receive the same severance benefits as Executive would
have received pursuant to Sections 6(a) hereof, subject to the
execution by Executive or his estate, as applicable, of the
required Release under Section 6(b) hereof.
(e) Exclusive Remedy . In the
event of a termination of Executive’s employment with the
Company, the provisions of this Section 6 are intended to be
and are exclusive and in lieu of any other rights or remedies to
which Executive or the Company may otherwise be entitled. Executive
will be entitled to no benefits, compensation or other payments or
rights upon termination of employment other than those benefits
expressly set forth in this Section 6, except as provided by
law or as set forth in other written agreements with the Company;
provided, however, that to the extent that the provisions of this
Agreement and any other written agreement shall conflict, then the
provisions of this Agreement shall apply.
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(f) Deferred Compensation .
Notwithstanding anything to the contrary in this Agreement, if
Executive is a “specified employee” within the meaning
of Section 409A of the Code and any final regulations and
guidance promulgated thereunder (“ Section 409A
”) at the time of Executive’s termination, then only
that portion of the severance and benefits payable to Executive
pursuant to this Agreement, if any, and any other severance
payments or separation benefits which may be considered deferred
compensation under Section 409A (together, the “Deferred
Compensation Separation Benefits”), which (when considered
together) do not exceed the Section 409A Limit (as defined
herein) may be made within the first six (6) months following
Executive’s termination of employment in accordance with the
payment schedule applicable to each payment or benefit. For these
purposes, each severance payment is hereby designated as a separate
payment and will not collectively be treated as a single payment.
Any portion of the Deferred Compensation Separation Benefits in
excess of the Section 409A Limit otherwise due to Executive on
or within the six (6) month period following Executive’s
termination will accrue during such six (6) month period and
will become payable in a lump sum payment on the date six
(6) months and one (1) day following the date of
Executive’s termination of employment. All subsequent
Deferred Compensation Separation Benefits, if any, will be payable
in accordance with the payment schedule applicable to each payment
or benefit. Notwithstanding anything herein to the contrary, if
Executive dies following termination but prior to the six
(6) month anniversary of Executive’s date of
termination, then any payments delayed in accordance with this
paragraph will be payable in a lump sum as soon as administratively
practicable after the date of Executive’s death and all other
Deferred Compensation Separation Benefits will be payable in
accordance with the payment schedule applicable to each payment or
benefit. It is the intent of this Agreement to comply with the
requirements of Section 409A so that none of the severance
payments and benefits to be provided hereunder will be subject to
the additional tax imposed under Section 409A, and any
ambiguities herein will be interpreted to so comply. The Company
and Executive agree to work together in good faith to consider
amendments to this Agreement and t
