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EXHIBIT
10.52
EXECUTIVE SEVERANCE AND
NONCOMPETITION AGREEMENT
April 11, 2007
Merix Corporation
an Oregon corporation
PO Box 3000
Forest Grove, Oregon 97116
Merix Corporation
(“Merix”) considers the establishment and maintenance
of a sound and vital management to be essential to protecting and
enhancing the best interests of Merix and its shareholders. In this
connection, Merix recognizes that, as is the case with many
publicly held corporations, the possibility of a change of control
may exist and that such possibility, and the uncertainty and
questions that it may raise among management, may result in the
departure or distraction of management personnel to the detriment
of Merix and its shareholders. In order to induce Linda V Moore
(“Executive”) to remain employed by Merix in the face
of uncertainties about the long-term strategies of Merix and
possible change of control of Merix and their potential impact on
Executive’s position with Merix, this Agreement, which has
been approved by the Board of Directors of Merix, sets forth the
severance benefits that Merix will provide to Executive in the
event Executive’s employment by Merix is terminated under the
circumstances described in this Agreement. To induce Merix to enter
into this Agreement, Executive agrees to the covenants set forth in
Section 6 of this Agreement.
| 1. |
Employment Relationship. |
Executive is currently
employed by Merix as Vice President HR and General Counsel.
Executive and Merix acknowledge that either party may terminate
this employment relationship at any time and for any or no reason,
subject to the obligation of Merix to provide the severance
benefits specified in this Agreement in accordance with the terms
hereof.
In consideration for and as a
condition precedent to receiving the severance benefits outlined in
this Agreement, Executive agrees to execute and deliver to Merix a
Release of Claims in the form attached as Exhibit A (“Release
of Claims”) that will be delivered to Executive on the date
of Termination of Executive’s Employment (as defined in
Section 9.1).
| 3. |
Additional Compensation Upon Termination. |
In addition to unpaid salary
and other wages, if any, payable to Executive through the date of
Termination of Executive’s Employment, in the event of a
Termination of Executive’s Employment at any time other than
for Cause (as defined in Section 9.2 of this Agreement), death
or Disability (as defined in Section 9.4 of this Agreement),
and contingent upon Executive’s execution of the Release of
Claims and compliance with Section 11 of this Agreement,
Executive shall be entitled to the following benefits:
3.1 As severance pay and in
lieu of any other compensation for periods subsequent to the date
of Termination of Executive’s Employment, Merix shall pay
Executive, in a single payment after employment has ended and eight
days have passed following execution of the Release of Claims
without revocation, an amount in cash equal to one year of
Executive’s annual base pay at the rate in effect immediately
prior to the date of Termination of Executive’s
Employment.
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3.2 Executive is entitled to
extend coverage under any group health plan in which Executive and
Executive’s dependents are enrolled at the time of
Termination of Executive’s Employment under the COBRA
continuation laws for the 18-month statutory period, or for as long
as Executive remains eligible under COBRA. Merix will pay Executive
a lump sum payment in an amount equivalent to the reasonably
estimated cost Executive may incur to extend for a period of 18
months under the COBRA continuation laws Executive’s group
health and dental plan coverage in effect at the time of
Termination of Executive’s Employment. Executive may use this
payment, as well as any payment made under Section 3.1, for
such COBRA continuation coverage or for any other
purpose.
3.3 Executive shall be
entitled to a portion of the benefits under any annual cash
incentive plans in effect at the time of Termination of
Executive’s Employment equal to the greater of (a) 50
percent of Executive’s target benefit under such plan for the
year or (b) a prorated amount representing the portion of the
plan year during which Executive was a participant. For purposes of
this Agreement, Executive’s participation in any such plan
will be considered to have ended on Executive’s last day of
active employment. In making the proration calculation, the amount
of Executive’s award if Executive had been a participant for
the full incentive period shall be divided by the total number of
days in the incentive period, and the result multiplied by the
actual number of days Executive participated in the plan. The
payment amount shall be calculated at the end of the incentive
period and the amount shall not be due and payable by Merix to
Executive until the date that all awards are payable to other
eligible employees after the close of the incentive period, except
that Executive may elect at any time after Termination of
Executive’s Employment, by written notice to Merix, to
receive 50 percent of Executive’s target benefit instead of
the prorated amount, in which case the payment shall be made within
20 days of such election. If the applicable plan provides for a
greater payment for a participant whose employment terminates prior
to the end of an incentive period, the applicable plan payment
shall be made. Executive acknowledges that this Section 3.3
modifies and supersedes any payment provisions under any existing
or future bonus plan.
3.4 Merix will pay up to
$12,500 to a third-party outplacement firm selected by Executive to
provide career counseling assistance to Executive for a period of
one year following the date of Termination of Executive’s
Employment. Executive may elect to receive the $12,500 in cash in
lieu of payment to a third-party outplacement firm.
3.5 All outstanding stock
options, restricted stock, stock bonuses or other stock awards
shall be governed by the terms of the applicable agreement or
plan.
| 4. |
Additional Compensation Upon Termination Following a Change
of Control. |
In the event of a Termination
of Executive’s Employment other than for Cause, death or
Disability within 24 months following a Change of Control (as
defined in Section 9.3), or prior to a Change of Control at
the direction of a person who has entered into an agreement with
Merix, the consummation of which will constitute a Change of
Control, and contingent upon Executive’s execution of the
Release of Claims and compliance with Sections 5 and 11, Executive
shall be entitled to the following benefits, which benefits shall
be in addition to the benefits provided in
Section 3:
4.1 Merix shall pay
Executive, in a single payment within the later of (a) eight
days after the last day of employment, including employment during
the up-to-six-months-employment period referred to in
Section 5 if Merix or the surviving company has requested
Executive to continue employment during such period and
(b) eight days after execution of the Release of Claims
without revocation, an amount in cash equal to one year of
Executive’s annual base pay at the rate in effect immediately
prior to the date of Termination of Executive’s
Employment.
4.2 Executive shall be
entitled to receive an amount such that the amount payable pursuant
to Section 3.3 plus the amount payable pursuant to this
Section 4.2 equals 100 percent of the Executive’s target
benefit for the year under annual cash incentive plans in effect at
the time of Termination of Executive’s Employment. The amount
payable pursuant to Section 4.2 shall be paid on the same date
that the Section 4.1 payment is payable.
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4.3 Merix shall maintain in
full force and effect, at its sole cost and expense, for
Executive’s continued benefit for a period terminating 18
months after the date of Termination of Executive’s
Employment, a life insurance policy insuring Executive’s life
with coverage equal to two times Executive’s annual base pay
in effect immediately prior to Termination of Executive’s
Employment, provided that Executive’s continued participation
is possible under the general terms and provisions of such policy.
At Executive’s election, or if Executive’s continued
participation in such policy is barred, Merix shall make a lump-sum
payment to Executive equal to the total premiums that would have
been paid by Merix for such 18-month period. The maximum amount
that Merix shall be obligated to pay pursuant to this
Section 4.3 in premiums and payments to Executive shall be
$5,000.
4.4 The possibility of
forfeiture to Merix of all stock issued to Executive under all
Executive Stock Bonus Agreements shall immediately
lapse.
4.5 All outstanding stock
options held by Executive under all stock option and stock
incentive plans of Merix shall become immediately exercisable in
full and shall remain exercisable until the earlier of (a) two
years after Termination of Executive’s Employment or
(b) the option expiration date as set forth in the applicable
option agreement.
4.6 Notwithstanding any
provision in this Agreement, in the event that Executive would
receive a greater after-tax benefit from the Capped Benefit (as
defined in the next sentence) than from the payments pursuant to
this Agreement (the “Specified Benefits”), the Capped
Benefit shall be paid to Executive and the Specified Benefits shall
not be paid. The Capped Benefit is the Specified Benefits, reduced
by the amount necessary to prevent any portion of the Specified
Benefits from being “parachute payments” as defined in
Section 280G(b)(2) of the Internal Revenue Code of 1986, as
amended (“IRC”), or any successor provision. For
purposes of determining whether Executive would receive a greater
after-tax benefit from the Capped Benefit than from the Specified
Benefits, there shall be taken into account all payments and
benefits Executive will receive upon a Change in Control of Merix
(collectively, excluding the Specified Benefits, the “Change
of Control Payments”). To determine whether Executive’s
after-tax benefit from the Capped Benefit would be greater than
Executive’s after-tax benefit from the Specified Benefits,
there shall be subtracted from the sum of the before-tax Specified
Benefits and the Change of Control Payments (including the monetary
value of any non-cash benefits) any excise tax that would be
imposed under IRC § 4999 and all federal, state and local
taxes required to be paid by Executive in respect of the receipt of
such payments, assuming that such payments would be taxed at the
highest marginal rate applicable to individuals in the year in
which the Specified Benefits are to be paid or such lower rate as
Executive advises Merix in writing is applicable to
Executive.
4.7 If Executive’s
employment with Merix terminates for any reason prior to a Change
of Control, other than at the direction of a person who has entered
into an agreement with Merix, the consummation of which will
constitute a Change of Control, Executive shall not be entitled to
benefits under Section 4 of this Agreement.
Executive agrees that, if
requested by Merix or the surviving company following a Change of
Control, Executive will continue his or her employment with Merix
or the surviving company for a period of up to six months following
the Change of Control in any capacity requested by Merix or the
surviving company consistent with Executive’s areas of
professional expertise.
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