This
Employment
Agreement (the “Agreement” )
is made and entered into effective as of December 18, 2008
(the “Effective Date” ), by and between
Dot Hill Systems
Corp. , a Delaware corporation (the
“Company” ), and Hanif Jamal (the
“Executive” ). The Company and the
Executive are hereinafter collectively referred to as the
“Parties” , and individually referred to
as a “Party” . This Agreement shall
replace and supersede that certain Change of Control Agreement
between Executive and the Company entered into on July 14,
2006 (the “ Prior Agreement
”).
A.
The Company desires assurance of the continued association and
services of the Executive in order to retain the Executive’s
experience, skills, abilities, background and knowledge, and is
willing to engage the Executive’s services on the terms and
conditions set forth in this Agreement.
B.
The Executive desires to continue to be in the employ of the
Company, and is willing to accept such continued employment on the
terms and conditions set forth in this Agreement.
C.
The Company and the Executive desire to amend and restate the Prior
Agreement in their entirety as set forth herein, effective as of
the date set forth above, and to set forth the terms and conditions
of Executive’s continued employment with the
Company.
In consideration
of the foregoing Recitals and the mutual promises and covenants
herein contained, and for other good and valuable consideration,
the Parties, intending to be legally bound, agree as
follows:
1.1 Term.
The Company hereby employs the Executive, and the Executive hereby
accepts employment by the Company, upon the terms and conditions
set forth in this Agreement, until the termination of the
Executive’s employment in accordance with Section 4
below, as applicable (the “Term” ). The
Executive shall be employed at will, meaning that either the
Company or the Executive may terminate this agreement and
Executive’s employment at anytime, for any reason or no
reason, with or without cause, without liability to the other save
for wages earned through the effective date of
termination.
1.2 Title.
The Executive shall have the title of Senior Vice President &
Chief Financial Officer ( “CFO” ) of the
Company and shall serve in such other capacity or capacities as the
Board of Directors of the Company (the
“Board” ) or the Company’s Chief
Executive Officer may from time to time prescribe with
Executive’s consent.
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1.3
Duties. The Executive shall do and perform all services, acts
or things necessary or advisable to manage and conduct the business
of the Company and which are normally associated with the position
of CFO, consistent with the bylaws of the Company and as required
by the Board and the Chief Executive Officer.
1.4 Policies
and Practices. The employment relationship between the Parties
shall be governed by the policies and practices established from
time to time by the Company and the Board.
1.5
Location. Unless the Parties otherwise agree in writing, during
the term of this Agreement, the Executive shall perform the
services Executive is required to perform pursuant to this
Agreement at the Company’s offices, located in Carlsbad,
California, or, with the consent of the Company and Executive, at
any other place at which the Company maintains an office; provided,
however, that the Company may from time to time require the
Executive to travel temporarily to other locations in connection
with the Company’s business.
2.
Loyal And Conscientious Performance;
Noncompetition.
2.1
Loyalty. During the Executive’s employment by the
Company, the Executive shall devote Executive’s full business
energies, interest, abilities and productive time to the proper and
efficient performance of Executive’s duties under this
Agreement. Notwithstanding the foregoing, Executive may engage in
personal, investment, civic, and charitable activities to the
extent they do not unreasonably interfere with Executive’s
performance of his duties under this Agreement or violate
paragraphs 2.2 or 2.3 of this Agreement.
2.2 Covenant
not to Compete. Except with the prior written consent of the
Board, the Executive will not, during the Term of this Agreement
engage in competition with the Company and/or any of its
Affiliates, either directly or indirectly, in any manner or
capacity, as adviser, principal, agent, affiliate, promoter,
partner, officer, director, employee, stockholder, owner, co-owner,
consultant, or member of any association or otherwise, in any phase
of the business of developing, manufacturing and marketing of
products or services which are in the same field of use or which
otherwise compete with the products or services or proposed
products or services of the Company and/or any of its Affiliates.
For purposes of this Agreement,
“Affiliate” means, with respect to any
specific entity, any other entity that, directly or indirectly,
through one or more intermediaries, controls, is controlled by or
is under common control with such specified entity. Ownership by
the Executive, as a passive investment, of less than two percent
(2%) of the outstanding shares of a capital stock of any
corporation with one or more classes of its capital stock listed on
a national or foreign securities exchange or publicly traded on the
Nasdaq Stock Market or in the over-the-counter market shall not
constitute a breach of this paragraph.
2.3 Agreement
not to Participate in Company’s Competitors. During the
Term the Executive agrees not to acquire, assume or participate in,
directly or indirectly, any position, investment or interest known
by Executive to be adverse or antagonistic to the Company, its
business or prospects, financial or otherwise or in any company,
person or entity that is, directly or indirectly, in competition
with the business of the Company or any of its Affiliates.
Ownership by the Executive, as a passive investment, of less than
two percent (2%) of the
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outstanding
shares of capital stock of any corporation with one or more classes
of its capital stock listed on a national or foreign securities
exchange or publicly traded on the Nasdaq Stock Market or in the
over-the-counter market shall not constitute a breach of this
paragraph.
3.
Compensation Of The
Executive.
3.1 Base
Salary. The Company shall pay the Executive a base salary of
Two Hundred Seventy Thousand dollars ($270,000) per year, less
payroll deductions and all required withholdings payable in regular
periodic payments in accordance with Company policy (the
“Base Salary” ). Such Base Salary shall
be prorated for any partial year of employment on the basis of a
365-day fiscal year.
3.2 Annual
Discretionary Bonus. In addition to the Executive’s Base
Salary, the Executive will be eligible to receive an annual bonus
pursuant to the Company’s Executive Compensation Plan. The
bonus amount the Executive will actually receive, if any, shall be
determined in the sole and absolute discretion of the Compensation
Committee of the Board by evaluating the Executive’s and the
Company’s performance against milestones and targets
established by the Compensation Committee in its sole and absolute
discretion and set forth in the Executive Compensation Plan. The
good faith determinations of the Compensation Committee with
respect to the amount or payment of any bonus shall be final and
binding. Any bonus that is earned by the Executive under the
Executive Compensation Plan, or any other bonus plan approved by
the Compensation Committee, shall be paid to the Executive during
the Company’s fiscal year immediately following the fiscal
year for which such bonus was earned.
3.3 Changes to
Compensation. The Executive’s compensation may be changed
from time to time by mutual agreement of the Executive and the
Company.
3.4 Employment
Taxes. All of the Executive’s compensation shall be
subject to customary withholding taxes and any other employment
taxes as are commonly required to be collected or withheld by the
Company.
3.5
Benefits. The Executive shall, in accordance with Company
policy and the terms of the applicable plan documents, be eligible
to participate in benefits under any executive benefit plan or
arrangement that may be in effect from time to time and is made
generally available to the Company’s executive or key
management employees, including but not limited to paid vacation
and medical insurance, provided that, the Executive shall receive
not less than four (4) weeks paid vacation per
year.
3.6 Stock Awards. The Company
may grant the Executive stock awards to purchase the
Company’s common stock at such times and on such terms as may
be decided from time to time by the Board, in its sole
discretion.
4.1
Termination. If the Executive’s employment is terminated
for any reason (either by the Company, by the Executive, or due to
the Executive’s death or disability), then the Company shall
pay to Executive or Executive’s heirs the Executive’s
Base Salary, any bonus awarded under Section 3.2 not
previously paid, and any accrued and unused vacation
benefits,
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each as earned
through the date of termination at the rate then in effect, less
standard deductions and withholdings, and the Company shall
thereafter have no further obligations to the Executive and/or the
Executive’s heirs under this Agreement.
5.
Change of Control
Bonus
5.1 Change of
Control Bonus Benefits. In the event that Executive continues
in employment with the Company through the effective date of a
Change of Control, the Company shall provide the Executive with the
following benefits hereunder:
(a) A lump sum cash payment equal to 125% of the
Executive’s annual Base Salary (the “ Change of
Control Cash Bonus ”). For purposes of calculating
the bonus amount to be paid pursuant this Section 5.1(a), the
Company shall use the Executive’s annual Base Salary as in
effect immediately prior to the Change of Control. Such payment
shall be subject to standard deductions and withholdings and paid
in accordance with the Company’s regular payroll policies and
practices in the first payroll period following the effective date
of the Change of Control; and
(b) As of immediately prior to the Change of Control, the
vesting of all unvested Company equity awards granted to Executive
shall accelerate immediately such that all equity awards will be
immediately fully vested and exercisable, if applicable.
5.2 Change of
Control. For purposes of this Agreement, “ Change
of Control ”
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