Exhibit 10.2
August 27, 2008
Mr. Anil Gupta
[Address]
Dear Anil:
On behalf of Adaptec, Inc., I am pleased to offer you the
position of Vice President and General Manager, reporting to me. I
am confident that you will provide the senior leadership that will
continue to enhance our customer and stockholder value.
We are confident you will make a major contribution to our
success and are looking forward to having you join us.
EMPLOYMENT
AGREEMENT
Adaptec, Inc., a Delaware corporation (hereinafter, "
Adaptec "), is acquiring Aristos Logic Corporation, a
Delaware corporation (hereinafter " Aristos ") (the "
Acquisition "), pursuant to the merger of Merger Sub
(as hereafter defined) with and into Aristos (the "Merger") to be
effected pursuant to the Agreement and Plan of Merger dated on or
about August 27, 2008 (as may be amended from time to time) (the "
Merger Agreement ") by and among Adaptec, Aristos,
and Ariel Acquisition Corp., a wholly-owned acquisition subsidiary
of Adaptec ("Merger Sub'). It is a material inducement and
condition to Adaptec's execution and delivery of the Merger
Agreement and its willingness to complete the Acquisition that you,
Anil Gupta (the " Employee ") enter into this
employment agreement (the " Agreement "). This
Agreement becomes effective upon the closing of the Acquisition
(the " Effective Date "). If you accept this offer,
and the contingencies of this offer are satisfied, on the Effective
Date you will become an employee of Adaptec or its subsidiary (at
Adaptec's sole election), on the following terms. If you do not
accept this offer prior to the time the Merger Agreement is entered
into, your employment with Aristos will be viewed as a voluntary
resignation, and your employment will terminate immediately prior
to the Effective Date, and you will not be entitled to any
severance from Adaptec or Aristos. This Agreement supersedes the
terms of Employee's Aristos Logic employment agreements.
1.
DUTIES AND RESPONSIBILITIES : Employee will be employed by
Adaptec in the position of Vice President and General Manager,
reporting to Adaptec's Chief Executive Officer (hereinafter, "
CEO "). Employee's duties and responsibilities will
be assigned by Adaptec's CEO or his designee. Employee's duties and
responsibilities may be altered, modified and changed as Adaptec's
CEO deems appropriate.
2.
COMPENSATION : Employee's base salary will be $267,586 per
year. Adaptec's CEO and Compensation Committee of the Board of
Directors may increase Employee's base salary from time to time as
they deem appropriate. In addition, Employee will be eligible to
participate in the Performance Incentive Plan at a targeted amount
of 50% of annual base salary. That plan has a variable payout based
upon Aristos Logic's product lines performance, as well as the
performance of Employee. The performance targets for Adaptec and/or
Aristos Logic's product lines and Employee which shall serve as the
basis for awarding Employee an incentive bonus shall be established
by Adaptec's CEO and Board of Directors, in their sole discretion,
prior to the beginning of Adaptec's FY'09 Q3 and at the beginning
of the each subsequent Fiscal Year. It is within the sole
discretion of Adaptec's CEO or his designee to determine whether
Employee achieved all or part of the targets established as well as
the resulting bonus amount to be awarded. All bonus plans,
including all performance targets and all other aspects and
conditions of those plans, shall be established by and subject to
change and modification by Adaptec's CEO and Board of Directors in
their sole discretion.
3.
STOCK OPTIONS :
In accordance with Adaptec Stock Option Plan, the
Compensation Committee of our Board of Directors approved that
Employee be granted an option to purchase 40,000 shares of Adaptec
stock. The Option shall be an "Incentive Stock Option" to the
maximum limit allowable under the 2004 Plan and IRS regulations.
Any portion of this Option in excess of the 2004 Plan and IRS
limitations shall be deemed to be a Non-Qualified Stock Option. The
exercise price of the Option shall be the fair market value of
Adaptec's common stock on the date of grant, tentatively scheduled
for September 2, 2008 (the date you actively join Adaptec's
payroll). These options will cliff vest at 33% on September 2,
2009, and vest quarterly thereafter at 8.375% and will be fully
vested at the end of three years, subject to Employee's continued
service. Employee will also receive 75,000 shares of
performance-based restricted stock awards that vest upon on the
completion of specific performance goals to be determined by
Employee and CEO, and approved by the Compensation Committee of
Adaptec's Board of Directors. As deemed appropriate by Adaptec's
CEO and Board of Directors, Employee may receive additional grants
under the 2004 Equity Incentive Plan. Any such future grants will
vary in number given and in vesting schedules.
4.
BENEFITS : Employee shall be eligible for all benefits
normally and regularly provided to Adaptec's executive staff as may
be in effect from time to time, if any, in accordance with the
rules established from time to time for individual participation in
any such plans. In addition, Employee will be entitled to receive
the following benefits: a $650 per month automobile allowance and a
company-paid annual physical examination.
5.
EMPLOYEE'S AT-WILL EMPLOYMENT : Employee understands and
agrees that his employment relationship with Adaptec is for an
INDEFINITE PERIOD and is on an AT-WILL basis. This
means that Employee is free to terminate his employment with
Adaptec at any time with or without cause or notice and that
Adaptec is similarly entitled to terminate Employee's employment at
any time with or without cause or notice. Employee understands and
agrees that the AT-WILL nature of his employment with
Adaptec will be maintained throughout the time he is employed by
Adaptec and can only be changed by an express written employment
contract specifically prepared for Employee and signed by Adaptec's
CEO. If Employee's employment is terminated for any reason,
Employee shall not be entitled to any payments, benefits, damages,
awards or compensation other than as expressly and specifically
required by Section 10 of this Agreement.
6.
OUTSIDE ACTIVITIES : During Employee's employment with
Adaptec, he agrees to devote his full productive time, energies and
abilities to the proper and efficient management of Adaptec's
business. Without express, prior written authorization from
Adaptec's CEO, Employee shall not, directly or indirectly, during
the term of his employment: (1) render services of a business,
professional or commercial nature, to any other person, firm,
entity, or business, whether for compensation or otherwise; or (2)
engage in any activity competitive with or adverse to Adaptec's
business or welfare, whether alone, or as an owner, shareholder or
partner, or as an officer, director, employee, advisor, contractor
or consultant; or (3) serve as a Director of a for-profit
company.
7.
PROTECTION OF ADAPTEC'S CONFIDENTIAL AND PROPRIETARY INFORMATION
AND TRADE SECRETS : During Employee's employment with Adaptec
as well as at all times following his termination thereof, Employee
agrees to abide by and comply with the Aristos Employee Invention
and Confidentiality Agreement (the "EICA") which he entered into
and the Employee Proprietary Information Agreement (the "EPIA"), a
copy of which is attached hereto as Exhibit B and
incorporated herein .
8.
TERMINATION OF EMPLOYMENT : Employee's employment with
Adaptec is at-will and may be terminated by Employee or by Adaptec
at any time for any reason as follows:
(a)
Employee may terminate employment upon written notice to Adaptec
for "Good Reason," as defined below (an " Involuntary
Termination " );
(b)
Employee may terminate employment upon written notice to Adaptec at
any time in Employee's discretion without Good Reason ( "
Voluntary Termination " );
(c)
Adaptec may terminate Employee's employment upon written notice to
Employee at any time following a determination that there is
"Cause," as defined below, for such termination ( "
Termination for Cause " );
(d)
Adaptec may terminate Employee's employment upon written notice to
Employee at any time without Cause for such termination ( "
Termination without Cause " );
(e)
Employee's employment will automatically terminate upon Employee's
death or upon Employee's disability as determined by Adaptec ( "
Termination for Death or Disability " ); provided that
"disability" shall mean Employee's complete inability to perform
Employee's job responsibilities for a period of ninety (90)
consecutive days or ninety (90) days in the aggregate in any twelve
(12) month period.
9.
DEFINITIONS . As used in this Agreement, the following terms
have the following meanings:
(a)
" Cause " means Employee's (i) neglect or poor
performance of duties, if not remedied to the satisfaction of the
CEO after written notice has been given to the Employee by the CEO
or his or her designee; (ii) willful and deliberate malfeasance or
gross negligence in the performance of duties and responsibilities;
(iii) commission of any act of fraud, gross misconduct or
dishonesty with respect to Adaptec; (iv) conviction of, or plea of
guilty or "no contest" to, a felony, a serious violation of the law
or a crime involving moral turpitude, fraud, or misappropriation of
funds; (v) breach or violation of this Agreement or any proprietary
information and inventions or confidentiality agreement with
Adaptec, including the EICA and the EPIA; or (vi) refusal or
unwillingness to follow the lawful directions of the CEO or the
Board.
(b)
" Change of Control " means (i) any "person" (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act)
(other than Adaptec, a subsidiary or an Adaptec employee benefit
plan, including any trustee of such plan acting as trustee) is or
becomes the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of Adaptec
representing fifty percent (50%) or more of either the then
outstanding shares of the common stock of Adaptec or the combined
voting power of Adaptec's then outstanding securities; (ii) a
change in the composition of the Board occurring within a two-year
period, as a result of which fewer than a majority of the directors
are Incumbent Directors. " Incumbent Directors " shall mean
directors who either (I) are directors as of the date hereof, or
(II) are elected, or nominated for election, to the Board with the
affirmative votes of at least a majority of the Incumbent Directors
at the time of such election or nomination (but shall not include
an individual whose election or nomination is in connection with an
actual or threatened proxy contest relating to the election of
directors to Adaptec); (iii) the consummation of a merger or
consolidation of Adaptec with any other corporation, other than a
merger or consolidation which would result in the voting securities
of Adaptec outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty
percent (50%) of the then outstanding shares of the common stock of
Adaptec and the combined voting power of Adaptec's then outstanding
securities; or (iv) the consummation of the sale or disposition by
Adaptec of all or substantially all Adaptec's assets.
(c)
" Good Reason " means Employee terminates employment
within sixty (60) days following the occurrence of any of the
following taken without Employee's written consent (i) a material
reduction in Employee's duties or responsibilities from those in
effect prior to a Change of Control; (ii) a requirement by Adaptec
that Employee relocate Employee's principal office to a facility
more than twenty-five (25) additional commuting miles from
Adaptec's current headquarters; or (iii) a material reduction in
Employee's annual base salary and target incentive compensation by
5% (other than in connection with a general decrease in the salary
of all similarly situated employees of Adaptec); provided that
Employee has given notice to any successor entity following such
action and a thirty (30) day opportunity to cure.
10.
SEPERATION PAYMENTS AND BENEFITS . Upon termination of
Employee's employment with Adaptec for any reason, Employee will
receive payment for all unpaid salary and vacation accrued as of
the date of termination of employment, and benefits will be
continued under Adaptec's then existing benefit plans and policies
for so long as provided under the terms of such plans and policies
and as required by applicable law. Under certain circumstances and
conditioned upon Employee's execution of a release and waiver of
claims (acceptable to, and in such form and substance as provided
by, Adaptec) against Adaptec, its officers and directors, Employee
will also be entitled to receive the payments and benefits as set
forth below; provided, however, that Employee shall not be entitled
to the payments and benefits set forth below in the event
Employee's termination occurs following the three-year anniversary
of the Effective Date.
(a)
In the event of Employee's Voluntary Termination, Termination
for Cause, or Termination for Death or Disability , Employee
will not be entitled to any cash or other severance benefits or any
accelerated vesting of Adaptec equity awards Employee may then
hold.
(b)
In the event of Adaptec's termination of Employee which
constitutes a Termination without Cause , Employee will be
entitled to (i) a lump sum payment in an amount equal to nine
(9) months of Employee's then current annual base salary plus,
for each year of Employee's service with Aristos Logic and Adaptec
in excess of three years, an additional week of base salary not to
exceed eight additional weeks of base salary, (ii) provided
Employee becomes eligible and timely elects to continue Employee's
health coverage under COBRA, reimbursement for any COBRA payments
made by Employee with respect to Employee and Employee's legal
dependents in the nine (9) months following the date of
termination, and (iii) outplacement services through the use of a
company or consultant to be chosen by Employer in an amount not to
exceed $5,000 (to be paid by Adaptec directly to the outplacement
service provider). Any severance payment made pursuant to this
section shall be paid within thirty (30) days following the date of
Employee's termination, or at a later date if so required pursuant
to Section 409A(2)(B) of the Internal Revenue Code of 1986 (the "
Code "), as amended.
(c)
In the event of Employee's Involuntary Termination or Adaptec's
termination of Employee which constitutes a Termination without
Cause, in each case occurring within one (1) year following a
Change of Control, in lieu of the payments and benefits pursuant to
Section 10(b), Employee will be entitled to (i) a lump sum payment
in an amount equal to nine (9) months of Employee's then
current annual base salary plus, for each year of Employee's
service with Aristos Logic and Adaptec in excess of three years, an
additional week of base salary not to exceed eight additional weeks
of base salary, (ii) a lump sum payment in an amount equal to
Employee's then-applicable annual target bonus opportunity, (iii)
provided Employee becomes eligible and timely elects to continue
Employee's health coverage under COBRA, reimbursement for any COBRA
payments made by Employee with respect to Employee and Employee's
legal dependents in the nine (9) months following the date of
termination, (iv) outplacement services through the use of a
company or consultant to be chosen by Employer in an amount not to
exceed $5,000 (to be paid by Adaptec directly to the outplacement
service provider) (but to be paid in no event later than March 15
of the year following the year in which the termination occurs) and
(v) accelerated vesting with respect to one hundred percent (100%)
of any then-unvested shares subject to all Adaptec equity awards
then held by Employee. Any severance payment made pursuant to this
section shall be paid within thirty (30) days following the date of
Employee's termination, or at a later date if so required pursuant
to Section 409A(2)(B) of the Code.
11. OTHER PAYMENTS . Adaptec expressly acknowledges and
agrees that, pursuant to the Merger Agreement, Employee shall be
entitled to certain payments under (i) the Management Liquidation
Pool (as such term is defined in the Merger Agreement), to be paid
pursuant to the terms of the Merger Agreement and Section 2.3 of
the Company Disclosure Schedule, and the Bonus, Benefits, Waiver
and Release Agreement (the "BBWRA") attached hereto as Exhibit
A and incorporated herein, and (ii) the Special Employee Bonus
Pool (as such term is defined in the Merger Agreement), to be paid
pursuant to the terms of the Merger Agreement and in Section 3.9 of
the Company Disclosure Schedule (collectively, the "Other
Payments"). Adaptec further acknowledges and agrees that the terms
of the Merger Agreement and the BBWRA shall exclusively govern
Employee's rights to the Other Payments, and such rights shall not
be affected by the terms of this Agreement. Without limiting the
foregoing, for purposes of clarity, the terms of this Agreement
(including, without limitation, the variances with respect to the
definitions of "Cause" and "Good Reason" as set forth herein from
those in the BBWRA) shall not affect Employees' rights to receive
the Bonus under the BBWRA.
12.
NON-SOLICITATION . Employee agrees that for a period of
twelve (12) months immediately following a termination of
employment for any reason, Employee shall not either directly or
indirectly solicit, induce, recruit or encourage any of Adaptec's
employees to leave their employment, or take away such employees,
or attempt to solicit, induce, recruit, encourage, or take away
employees of Adaptec, either for Employee or any other person or
entity. Employee further agrees not to otherwise interfere with the
relationship of Adaptec or any of its subsidiaries or affiliates
with any person who, to Employee's knowledge, is employed by or
otherwise engaged to perform services for Adaptec or its
subsidiaries or affiliates (including, but not limited to, any
independent sales representatives or organizations) or who is, or
was within the then most recent prior twelve-month period, a
customer or client of Adaptec, or any of its subsidiaries.
13.
COOPERATION . Both during employment with Adaptec and
following termination, Employee shall cooperate fully with Adaptec
in the defense of any action or proceeding brought by any third
party against Adaptec that relates in any way to Employee's acts or
omissions while employed by Adaptec. Such cooperation shall
include, but not be limited to, Employee making himself available
to Adaptec and its counsel for interviews and to provide testimony
by declaration, deposition, and/or trial as requested by Adaptec's
counsel.
14.
FINAL AND BINDING ARBITRATION . The parties agree that any
controversy or claim arising out of or relating to this Agreement,
or the breach thereof, shall be submitted to the American
Arbitration Association (" AAA ") and that a neutral
arbitrator will be selected in a manner consistent with its
National Rules for the Resolution of Employment Disputes. The
arbitration proceedings will allow for discovery according to the
rules set forth in the National Rules for the Resolution of
Employment Disputes (the " Rules "). All arbitration
proceedings shall be conducted in Santa Clara County,
California.
Except as provided by the Rules, arbitration shall be the sole,
exclusive and final remedy for any dispute between Employee and
Adaptec. Accordingly, except as provided for by the Rules, neither
Employee nor Adaptec will be permitted to pursue court action
regarding claims that are subject to arbitration. The parties
expressly waive any entitlement to have such controversies decided
by a court or a jury. In addition to the right under the Rules to
petition the court for provisional relief, Employee agrees that any
party may also petition the court for injunctive relief where
either party alleges or claims a violation of this Agreement in
particular Section 7 of this Agreement.
Adaptec will cover all of Employee's legal expenses incurred by
Employee to enforce this Agreement following a Change of Control,
payable within ten (10) days of Employee's submission of evidence
of incurring Employee's incurring such expenses as a result of a
refusal to pay benefits under this Agreement.
15. . PAYMENT OF
TAXES : All payments made to Employee under this Agreement
shall be subject to all applicable federal and state income,
employment and payroll taxes. Employee is responsible for
legally mandated payroll deductions and withholdings.
16. RETURN
OF ADAPTEC EQUIPMENT AND PROPERTY . At the time of Employee's
termination of employment with Adaptec, Employee agrees to return
to Adaptec all Adaptec property and equipment, including but not
limited to, computers, printers, computer diskettes, software,
files, records, computations, reports, studies, manuals, notebooks,
documents, correspondence, customer lists, lists of potential
customers, and any and all other confidential information or
records and other similar items relating to Adaptec's business,
whether prepared by Employee or otherwise coming into Employee's
possession.
17.
ENTIRE AGREEMENT : Except as otherwise set forth herein,
this Agreement supersedes any and all other agreements or
understandings, including, but not limited to, any provision of any
equity plan or agreement with respect to vesting of awards granted
following the Effective Date, whether oral, implied or in writing,
between the parties hereto with respect to the subject matters
covered herein, and contains all of the covenants and agreements
between the parties with respect to such matters in their entirety.
Each party to this Agreement acknowledges that no representations,
inducements, promises or agreements, orally or otherwise, have been
made by any party, or anyone acting on behalf of any party, which
are not embodied herein, and that no other agreement, statement or
promise not contained in this Agreement shall be val
