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Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT
(the "Agreement"), dated as of December 8, 2006, is by and
between ARRIS GROUP, INC. , a Delaware corporation (the
"Company"), and Ronald M. Coppock ("Executive").
WHEREAS, Executive and the Company
are parties to a previous employment agreement dated as of
October 6, 2000 that expired on October 6, 2005; and
WHEREAS, Executive and the Company
desire to enter into a new written agreement providing for the
terms of Executive’s employment by the Company.
NOW, THEREFORE, in consideration
of the foregoing recitals and of the mutual covenants set forth
herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Employment .
Executive agrees to enter into the continued employment of the
Company, and the Company agrees to employ Executive, on the terms
and conditions set forth in this Agreement. Executive agrees during
the term of this Agreement to devote substantially all of his
business time, efforts, skills and abilities to the performance of
his duties as stated in this Agreement and to the furtherance of
the Company’s business.
Executive’s
initial job title will be President, Worldwide Sales and his duties
will be those as are designated by the Chief Executive Officer of
the Company. Executive further agrees to serve, without additional
compensation, as an officer or director, or both, of any
subsidiary, division or affiliate of the Company or any other
entity in which the Company holds an equity interest, provided,
however, that (a) the Company shall indemnify Executive from
liabilities in connection with serving in any such position to the
same extent as his indemnification rights pursuant to the
Company’s Certificate of Incorporation, By-laws and
applicable Delaware law, and (b) such other position shall not
materially detract from the responsibilities of Executive pursuant
to this Section 1 or his ability to perform such
responsibilities.
2. Compensation .
(a)
Base Salary . During the term of Executive’s
employment with the Company pursuant to this Agreement, the Company
shall pay to Executive as compensation for his services an annual
base salary of not less than $267,000 ("Base Salary").
Executive’s Base Salary will be payable in arrears in
accordance with the Company’s normal payroll procedures and
will be reviewed annually and subject to upward adjustment at the
discretion of the Chief Executive Officer and Compensation
Committee, but will not be lowered except in connection with
reductions applied to all executive officers.
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(b)
Incentive Bonus . During the term of Executive’s
employment with the Company pursuant to this Agreement,
Executive’s incentive compensation program shall be
determined by the Company in its discretion with a target bonus
equal to 60% of Base Salary, and allowing for payment of up to 150%
of target with respect to calendar year 2006 and 200% of target
with respect to calendar year 2007 and thereafter.
(c)
Executive Perquisites . During the term of Executive’s
employment with the Company pursuant to this Agreement, Executive
shall be entitled to receive such executive perquisites and fringe
benefits as are provided to the executives in comparable positions
and their families under any of the Company’s plans and/or
programs in effect from time to time and such other benefits as are
customarily available to executives of the Company and their
families, including without limitation vacations and life, medical
and disability insurance.
(d)
Tax Withholding . The Company has the right to deduct from
any compensation payable to Executive under this Agreement social
security (FICA) taxes and all federal, state, municipal or
other such taxes or charges as may now be in effect or that may
hereafter be enacted or required.
(e)
Expense Reimbursements . The Company shall pay or reimburse
Executive for all reasonable business expenses incurred or paid by
Executive in the course of performing his duties hereunder,
including but not limited to reasonable travel expenses for
Executive. As a condition to such payment or reimbursement,
however, Executive shall maintain and provide to the Company
reasonable documentation and receipts for such expenses.
3. Term . Unless
sooner terminated pursuant to Section 4 of this Agreement, and
subject to the provisions of Section 5 hereof, the term of
employment under this Agreement shall commence as of the date
hereof and shall continue for a period of one year. The term
automatically shall be extended by one day for each day of
employment hereunder. Notwithstanding the foregoing the term of
employment under this agreement shall terminate, if it has not
terminated earlier, without further action on the part of the
Company or Executive upon Executive’s 65th birthday.
4. Termination .
Notwithstanding the provisions of Section 3 hereof, but
subject to the provisions of Section 5 hereof,
Executive’s employment under this Agreement shall terminate
as follows:
(a)
Death . Executive’s employment shall terminate upon
the death of Executive; provided, however, that the Company shall
continue to pay (in accordance with its normal payroll procedures)
the Base Salary to Executive’s estate for a period of three
months after the date of Executive’s death.
(b)
Termination for Cause . The Company may terminate
Executive’s employment at any time for "Cause" (as
hereinafter defined) by delivering a written termination notice to
Executive. For purposes of this Agreement, "Cause" shall mean any
of: (i) Executive’s conviction of a felony or a crime
involving moral turpitude; (ii) Executive’s commission
of an
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act constituting fraud, deceit or material misrepresentation
with respect to the Company; (iii) Executive’s embezzlement
of funds or assets from the Company; (iv) Executive’s
addiction to any alcoholic, controlled or illegal substance or
drug; (v) Executive’s commission of any act or omission
which would give the Company the right to terminate
Executive’s employment under applicable law; or
(vi) Executive’s failure to correct or cure any material
breach of or default under this Agreement within ten days after
receiving written notice of such breach or default from the
Company.
(c)
Termination Without Cause . The Company may terminate
Executive’s employment at any time by delivering a written
termination notice to Executive.
(d)
Termination by Executive . Executive may terminate his
employment at any time by delivering ninety days prior written
notice to the Company; provided, however, that the terms,
conditions and benefits specified in Section 5 hereof shall
apply or be payable to Executive only if such termination occurs as
a result of a material breach by the Company of any provision of
this Agreement.
(e)
Termination Following Disability . In the event Executive
becomes mentally or physically impaired or disabled and is unable
to perform his material duties and responsibilities hereunder for a
period of at least ninety days in the aggregate during any one
hundred twenty consecutive day period, the Company may terminate
Executive’s employment by delivering a written termination
notice to Executive. Notwithstanding the foregoing, Executive shall
continue to receive his full salary and benefits under this
Agreement for a period of six months after the effective date of
such termination.
(f)
Payments . Following any expiration or termination of this
Agreement or Executive’s employment hereunder, and in
addition to any amounts owed pursuant to Section 5 hereof, the
Company shall pay to Executive all amounts earned by Executive
hereunder prior to the date of such expiration or termination.
5. Certain Termination
Benefits . Subject to Section 6(a) hereof, in the event
(i) the Company terminates Executive’s employment
without cause pursuant to Section 4(c) or (ii) Executive
terminates his employment pursuant to Section 4(d) after a material
breach by the Company (which the Company fails to cure within ten
days after written notice of such breach from Executive):
(a)
Base Salary and Bonus . The Company shall continue to pay to
Executive his Base Salary (as in effect as of the date of such
termination) and bonus based upon the assumption that Executive
would have fulfilled the requirements to earn his target bonus that
would have been payable hereunder to Executive from the date of
such termination for a period of twelve months following the
termination (and a prorate portion for any partial year).
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(b)
Stock . Subject to Section 10 hereof, on and as of the
effective date of the termination of employment, all of
Executive’s outstanding stock options and restricted stock
grants under the Company’s stock option and other benefit
plans shall immediately vest.
(c)
Life Insurance . The Company shall continue to provide
Executive with group and additional life insurance coverage for a
period of twelve months following termination.
(d)
Medical Insurance . The Company shall continue to provide
Executive and his family with group medical insurance coverage
under the Company’s Medical Plans (as the same may change
from time to time) or other substantially similar health insurance
for a period of twelve months following termination.
(e)
Group Disability . The Company shall continue to provide
Executive coverage under the Company’s group disability plan
for a period of twelve months following termination.
(f)
Section 409A . It is expressly contemplated by the
parties that this Agreement will conform to, and be interpreted to
comply with, Section 409A of the Internal Revenue Code of
1986, as amended (the "Code"). Unless expressly provided otherwise,
all of the payments due to Executive under this Section 5 will
be made within fifteen (15) days following the date of
termination; provided, however, that if under Section 409A of
the Code, such payments must be delayed to conform with the
applicable tax rules, the Company will defer any such payment until
no later than one day following the first date upon which such
payment may be made without incurring the tax imposed thereunder;
provided, further, that if Executive incurs any additional tax,
interest or penalties under Section 409A of the Code, the
Company will pay Executive an additional amount so that, after all
taxes on such amount, Executive has an amount equal to such
additional tax.
(g)
Offset . Any fringe benefits received by Executive in
connection with any other employment that are reasonably
comparable, but not necessarily as beneficial, to Executive as the
fringe benefits then being provided by the Company pursuant to this
Section 5, shall be deemed to be the equivalent of, and shall
terminate the Company’s responsibility to continue providing,
the fringe benefits then being provided by the Company pursuant to
this Section 5. The Company acknowledges that if
Executive’s employment with the Company is terminated,
Executive shall have no duty to mitigate damages.
(h)
General Release . Acceptance by Executive of any amounts
pursuant to this Section 5 shall constitute a full and complete
release by Executive of any and all claims Executive may have
against the Company, its officers, directors and affiliates,
including, but not limited to, claims he might have relating to
Executive’s cessation of employment with the Company;
provided, however, that there may properly be excluded from the
scope of such general release the following:
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(i)
claims that Executive may have against the Company for
reimbursement of ordinary and necessary business expenses incurred
by him during the course of his employment;
(ii)
claims that may be made by the Executive for payment of Base
Salary, fringe benefits or stock options properly due to him;
or
(iii)
claims respecting matters for which the Executive is entitled to be
indemnified under the Company’s Certificate of Incorporation
or Bylaws, respecting third party claims asserted or third party
litigation pending or threatened against the Executive.
Notwithstanding the foregoing, as a condition to the payment to
Executive of any amounts pursuant to this Section 5, Executive
shall execute and deliver to the Company a release in the customary
form then being used by the Company, which may include
non-disparagement and confidentiality agreements. In exchange for
such release, the Company shall, if Executive’s employment is
terminated without Cause, provide a release to Executive, but only
with respect to claims against Executive which are actually known
to the Company as of the time of such termination.
6. Effect of Change in
Control .
(a) If
within one year following a "Change of Control" (as hereinafter
defined), Executive terminates his employment with the Company for
Good Reason (as hereinafter defined) or the Company terminates
Executive’s employment for any reason other than Cause, death
or disability, the Company shall pay to Executive: (1) an
amount equal to one times the Executive’s Base Salary as of
the date of termination; (2) an amount equal to one times the
average annual cash bonus paid to Executive for the two fiscal
years immediately preceding the date of termination (and a prorate
portion for any partial year); (3) all benefits under the
Company’s various benefit
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