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Exhibit 10.10
CEO TRANSITION AGREEMENT
This Agreement (the "Agreement")
is made and entered into effective as of December 12, 2006
(the "Effective Date"), by and between Allen Alley (the
"Executive") and Pixelworks, Inc., an Oregon corporation (the
"Company").
R E C I T A L S
A. Executive has elected to
step down as the Company’s CEO, remaining on the
Company’s Board of Directors as Chair, effective
December 31, 2006 (the "Employment End Date"). As of
January 1, 2007, Executive will no longer be an employee of
the Company.
B. The Company and Executive
wish to confirm certain transition agreements between them, and
enter into this Agreement for that purpose.
AGREEMENT
For good and valuable
consideration the receipt and sufficiency of which the parties
acknowledge, the parties agree as follows:
1. Confirmation of
Resignation . Executive tenders his resignation as CEO of, and
as an employee of, the Company effective as of the Employment End
Date. The Company accepts Executive’s resignation and,
accordingly, Executive’s employment with the Company shall
terminate as of the Employment End Date.
2. Public
Announcement . Executive and Company shall coordinate the
public announcement of his resignation as CEO, to be issued
December 13, 2006 before market open.
3. Recognition of Amounts
Due . On the Employment End Date, Company shall pay executive
the following amounts:
(a)
Pay and Bonus Accrued . Executive shall receive all base
salary and bonuses accrued and earned through the Employment End
Date. Settlement of bonuses due may be delayed to a date not later
than the date on which 2006 executive bonuses are otherwise paid to
senior executives of the Company.
(b)
Medical Severance Benefits . If Executive is eligible for
and properly elects COBRA continuation of his Company-provided
group health benefits, Company shall pay the premiums for such
continuation coverage for up to twelve (12) months following
the Employment End Date.
(c)
Accrued Vacation; Expenses . The Company shall pay the
Executive all of the Executive’s accrued and unused vacation
through the Termination Date; and following submission of proper
expense reports by the Executive, the Company shall reimburse the
Executive for all expenses reasonably and necessarily incurred by
the Executive in connection with the business of the Company prior
to the Employment End Date. These payments shall be made promptly
upon termination and within the period of time mandated by law.
Page 1 — CEO Transition Agreement (Allen Alley)
4. Founder Transition
Benefits . In special recognition of Executive’s status
as the founding CEO of the Company, Company further provides these
benefits. As a condition of receiving these benefits, Executive
agrees to execute on or after December 31, 2006 and within the
time reasonably provided by the Company, and not to thereafter
revoke, a general release of claims in a form both reasonable and
materially standard to the Company, provided that it shall not
release his rights under his option agreements, or agreements
signed essentially contemporaneously herewith and governing his
service on the Board of Directors, or his rights under his 2006
Indemnity Agreement with the Company.
(a)
Furnishings . Company will provide Executive with office
equipment and furnishings suitable to equip one executive office.
Executive shall be entitled to select such furnishings and
equipment from furnishings previously used by Company, and
identified by Company as surplus. Company shall arrange for their
delivery to, and installation in, an office location selected by
Executive, provided the location is within fifty miles of the
Company’s offices located in Tualatin, Oregon.
(b)
PixelStone . Company will use good faith and commercially
reasonable efforts to protect its signature sculpture known in the
Company as the "PixelStone," and if at any time the Company no
longer wishes to keep the "PixelStone" on public display at its
Company headquarters wherever those may then be located (or takes
it off public display at its Company headquarters and does not
return it to display within one year), the Company shall arrange at
its ex
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