Exhibit 10.2
April 14, 2009
Brian Towne
29743 Quail Run Dr.
Agoura Hills, CA 91301
Re:
Employment Agreement
Dear Brian:
DTS, Inc. (“DTS” or the
“Company”) is pleased to extend to you the following
employment Agreement. Unless otherwise set forth in this
Agreement, you acknowledge that your employment with DTS is
“at-will”.
Title:
Executive Vice
President, General Manager
Duties:
You agree to serve the Company
as its Executive Vice President,
General Manager. Your duties are as defined in
Company’s job description for the position or as otherwise
specified by the President and Chief Executive Officer of the
Company. During the Term of this Agreement, you will devote
full time to, and use your best efforts to advance, the business
and welfare of the Company.
Status:
Salary Exempt.
Effective Date:
April 14, 2009.
Base Salary:
$280,000 per year payable biweekly
and subject to payroll deductions as may be necessary or customary
in respect of the Company’s salaried employees in
general.
Bonus:
Participation in the bonus plan will
be on a level commensurate with other executives, and subject to
completion of individual and company milestone achievements per
mutual agreement on targets.
Stock Options:
All Stock options granted to you are
conditioned on Board of Directors approval and shall vest over four
consecutive 12-month periods as per your Stock Option
Agreement with the Company and administered under the
respective Company’s Stock Option Plan .
Vacation:
You shall be provided with One Hundred Sixty (160) hours of vacation, which shall be automatically
replenished upon use. However, vacation hours will not be
replenished during any period where you are not actively working
for the Company, until you have resumed actively working for at
least one full workweek.
Holidays:
Per Company’s
annual published schedule (commonly 12 days per year); plan is
subject to change. The salary includes holiday pay and you
are not entitled to any additional salary or compensation for work
on a holiday.
Severance:
Upon the
termination of this Agreement by the Company for other than good
cause, including constructive termination: (A) the Company
shall for a period of twelve (12) months; (I) pay to Employee
in monthly installments, as severance pay, Employee’s full
Salary, and (II) provide Employee the same level of benefits
Employee was receiving as of the time of termination of this
Agreement, unless otherwise required by law, (B) all options,
restricted stock, or other Company issued equity incentives granted
to you (incentive and nonstatutory) shall (I) immediately vest
and (II) where applicable, be exercisable for five
(5) years from such termination (but not in excess of the
specified maximum term of such option). Constructive Termination shall mean any material
failure by the Company to fulfill its obligations under this
Agreement which is not cured within thirty (30) days after receipt
of written notice from you specifying the nature of the failure,
including, but not limited to, (a) your removal, other than
removal as a result of a termination for cause or your voluntary
termination, as Executive Vice President, General manager of the
Company, (b) any material change by the Company in your
functions, duties or responsibilities from those in which you were
engaged under this Agreement without your consent, or (c) a
material, non-voluntary reduction in your base salary and
eligibility for bonus amounts.
Benefits:
The following are
the Company supplied Benefits as of the date of this Agree
ment. Benefit coverage is
subject to change at company election that may result in
elimination of benefits or increased co-pay. Unless otherwise
set forth below, eligibility begins the first day of the month
after hire date. Please see the applicable plan documents for
additional information. In the event of any conflict between
this description and the plan document, the plan document will
prevail.
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Insurance:
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Health
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Long Term Disability
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Dental
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Long Term Care
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Vision
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Section 125: Available for dependent and
health care.
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Life: $50,000 coverage
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401k Plan: Enrollment
dates 1/1 4/1, 7/1 & 10/1.
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ESPP: Enrollment — May and
November
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1
Death or Disability of Employee
. If you die or become disabled prior to
the termination of this Agreement, your employment under this
Agreement will automatically terminate upon your death or the
determination that you are disabled. “Disability”
means any physical or mental illness that renders you unable to
perform your agreed-upon services under this Agreement for ninety
(90) consecutive days or an aggregate of one-hundred twenty (120)
days, whether or not consecutive, during any consecutive twelve
(12)-month period. Disability shall be determined by a
licensed physician selected by the Company that is not affiliated
with you or the Company. In the event of your death or
disability, the amounts due you pursuant to this Agreement through
the date of your death or disability will be paid to you or your
beneficiaries.
Termination for Cause
. Your employment under this Agreement may
be terminated immediately by the Company for “good
cause”. Upon such termination you will be provided
notice specifying the reasons for the termination. You shall
have ten (10) business days from the date such termination to
cure such cause, if curable. Absent such cure within the cure
period, your employment shall be deemed terminated for good cause
on the date of your termination. The term “good
cause” is defined as any one or more of the following
occurrences:
(I)
Negligence or a material violation
by you of any duty or any other material or repetitive misconduct
or failure on your part;
(II)
Your conviction by, or entry of a
plea of guilty or nolo contendere in, a court of competent and
final jurisdiction for any crime punishable by imprisonment in the
jurisdiction involved; or
(III)
Your commission of an act of fraud,
prior to or subsequent to the date of this Agreement, upon the
Company.
(IV)
Failure to execute and deliver to
the Company any document(s) required by all employees of the
Company, or employees of a similar position, at the location you
are employed.
Nothing in this section or the availability of
termination for good cause is intended to alter the at-will status
of employment with the Company. Either you or the company may
terminate the employment relationship at any time, with or without
cause.
Employee’s Consideration for
Severance. As
consideration for receiving severance pay and benefits provided
hereunder, during the period that Employee is receiving severance
pay or benefits hereunder, Employee shall:
(I)
Consulting
. Be reasonably available, by
telephone, as a consultant to the Company on projects or task you
have previously been involved in. It is agreed that eight
(8) hours per week of consultation, by phone, shall be
reasonable.
(II)
Non-Compete
. You agree that for the
period commencing on the date of this Agreement and ending upon the
date of the last severance payment hereunder, Employee shall not,
directly or indirectly, as employee, agent, consultant,
stockholder, director, partner or in any other individual or
representative capacity, own, operate, manage, control, engage in,
invest in or participate in any manner in, act as a consultant or
advisor to, render services for (alone or in association with any
person, firm, corporation or entity), or otherwise assist, for
compensation or otherwise, any person or entity that engages in or
owns, invests in, operates, manages or controls any venture or
enterprise that is a direct competitor of DTS; provided, however,
that nothing contained in this Agreement shall be construed to
prevent you from investing in the stock of any competing
corporation listed on a national securities exchange or traded in
the over-the-counter market, but only if: (1) you are not
involved in the business of said corporation, and (2) if you
and your affiliates collectively do not own more than an aggregate
of 5% of the stock of such corporation, and (3) such
investment does not violate the Company’s Insider Trading
Policy.
(III)
Non-Solicitation
. You agree that you will not
interfere with or disrupt o
