Exhibit 10.11
ALIEN TECHNOLOGY
CORPORATION
STAVRO PRODROMOU EMPLOYMENT
AGREEMENT
This Agreement is entered into as of
February 27, 2006 by and between Alien Technology Corporation (the
“Company”) and Stavro Prodromou
(“Executive”).
1. Duties and Scope of
Employment .
(a) Positions and Duties .
Executive will continue in his current position as President and
Chief Executive Officer (“CEO”) of the Company.
Executive will render such business and professional services in
ways and at times that are mutually acceptable.
(b) Obligations . During the
employment term, Executive will devote Executive’s full
business efforts and time to the Company. Executive shall work
exclusively for the Company during the term of employment, provided
however, that Executive may participate in outside activities, as
long as such activities do not interfere with the obligations
described hereunder, are not for competitors and are consistent and
in compliance with the Company’s conflict of interest policy,
but only to the extent Executive obtains prior approval from the
Board of Directors (the “Board”) of the Company (which
approval will not be unreasonably withheld).
2. At-Will Employment . At
will employment may be terminated by Executive or the Company, at
any time. Executive shall not be required without his consent to
work outside the San Francisco Bay Area.
3. Term of Agreement . This
Agreement will have a term of thirty-six (36) months,
commencing on January 2, 2006 (the “Effective
Date”).
4. Compensation .
(a) Total Cash Compensation .
As of the Effective Date, the Executive will be paid an annual base
salary equal to $300,000 (the “Base Salary”). The Base
Salary will be paid periodically in accordance with the
Company’s normal payroll practices and be subject to the
usual, required withholdings. In addition, the Executive will
receive a bonus of up to 100% of Base Salary upon achievement of
milestones mutually agreed with the Compensation Committee, which
will be paid quarterly.
(b) Options . During the
employment term, the Executive’s options will continue to
vest in accordance with the current vesting schedules in the
Executive’s option agreements and subject to the acceleration
described under Section 8 below. In addition, if there is a
change of control transaction during the period of employment,
Executive shall be entitled to receive the vesting acceleration
benefits set forth in the agreements governing Executive’s
outstanding equity awards, provided, that no other condition shall
be required for acceleration.
5. Employee Benefits . During
the term of employment, Executive will be eligible to participate
in accordance with the terms of all Company employee benefit plans,
policies, and arrangements that are applicable to other employees
of the Company; as such plans, policies, and arrangements may exist
from time to time, subject to the continued benefits described in
Section 8 below.
6. Expenses . The Company
will reimburse Executive for all reasonable travel, entertainment,
and other expenses incurred by Executive in the furtherance of the
performance of Executive’s duties hereunder, in accordance
with the Company’s expense reimbursement policy as in effect
from time to time, provided that travel will be first
class.
7. Termination of Employment
. In the event Executive’s employment with the Company
terminates for any reason, the Executive shall be entitled to
(a) all Base Salary accrued up to the effective date of
termination, (b) all pay for accrued, unused vacation that the
Company is legally obligated to pay Executive, if any, (c) all
benefits or compensation accrued prior to termination, as provided
under the terms of any employee benefit and compensation agreements
or plans applicable to the Executive, (d) exercise outstanding
stock options in accordance with the terms of the agreements
governing such equity awards, and (e) all business expenses
required to be reimbursed under the Company’s expense
reimbursement policy to the Executive with respect to business
expenses incurred prior to termination. For up to 12 months after
termination, Executive may retain laptop (subject to
Company’s security measures), office, cell phone, support,
voicemail. In addition, if the termination is by the Company
without Cause (as defined in the 1997 Stock Plan Senior Executive
Stock Option Agreement) or by the Executive for Good Reason (as
defined in Section 11 below), he shall be entitled to the
amounts and benefits specified in Section 8; provided,
however, that the amounts specified in Section 8 will be
reduced by amounts that Executive is eligible to receive as
severance under any other Company plan, policy, or
practice.
8. Severance .
(a) Termination Without Cause or
Resignation for Good Reason . In the event that during the term
of the Agreement, the Company terminates Executive’s
employment without Cause or Executive resigns for Good Reason,
Executive shall receive: (i) lump sum payment of
Executive’s Base Salary for the balance of the term of the
Agreement (ii) lump sum payment of Executive’s bonus
pursuant to Executive’s bonus plan in effect on such date
(iii) full acceleration of unvested equity compensation
granted pursuant to Executive’s August 22, 2002
employment letter, and (iv) reimbursement for COBRA premiums
for Executive and Executive’s eligible dependents, payable
when such premiums are due, provided Executive elects to continue
medical coverage under applicable law for the balance of the term
of the Agreement.
(b) Termination Without Cause or
Good Reason . If Executive resigns for reasons other than Cause
or Good Reason, Executive shall receive, in lieu of the payments
specified in (a) above: (i) lump sum payment of
Executive’s Base Salary for a period of 6 months,
(ii) pro-rated payment of Executive’s bonus pursuant to
Executive’s bonus plan in effect on such date, and
(iii) reimbursement for COBRA premiums for Executive and
Executive’s eligible dependents, payable when such premiums
are due, provided Executive elects to continue medical coverage
under applicable law for a period of 6 months following
termination.
(c) Termination for Cause .
If Executive’s employment with the Company terminates for
Cause by the Company, then, except as provided in Section 7,
(i) all further vesting of Executive’s outstanding
equity awards will terminate immediately, (ii) all payments
of
-2-
Compensation by the Company to Executive
hereunder will terminate immediately and (iii) Executive will
not be eligible for severance or change of control benefits in
accordance with this Agreement.
(d) Termination due to Death or
Disability . If Executive’s employment terminates by
reason of death or Disability (as defined in Section 11),
then, Executive will be entitled to receive benefits only in
accordance with the Company’s then established plans,
programs, and practices.
(e) 409A Compliance .
Notwithstanding subsections 8(a) and (b), to comply with Internal
Revenue Code Section 409A and only if the Company goes public
prior to Executive’s termination, during the first six months
after termination, Executive’s severance benefits will
accrue, payable in a lump sum payment on the second day of the
seventh month after termination.
(f) Additional Requirements .
In addition, the severance payments and accelerated vesting will be
subject to applicable tax withholding and to (i) Executive
signing and not revoking a separation agreement and release of
claims satisfactory to the Company and (ii) Executive
continuing to comply with the non-solicitation, non-compete, and
non-disparagement agreements with the Company described under
“Non-Solicitation, Non-Competition and
Non-Disparagement” below.
(g) Sole Right to Severance .
This Agreement is intended to represent Executive’s sole
entitlement to severance payments and benefits in connection with
the termination of his employment.
9. Conditions to Acceptance of
Agreement .
(a) Release of Claims . The
receipt of any benefits under this Agreement and the
Executive’
