EXHIBIT 10.2
EMPLOYMENT TRANSITION AND
CONSULTING AGREEMENT
This Employment Transition and
Consulting Agreement (hereafter “Agreement”) is entered
into between Mr. Scot A. Griffin (the
“Executive”) and Tessera, Inc. (the
“Company”), effective eight days after the
Executive’s signature (the “Effective Date”),
unless he revokes his acceptance as provided in Section 3(c)
below.
WHEREAS, the Executive is Executive
Vice President, Micro-Electronics Technologies of the
Company;
WHEREAS, the Executive wishes to
resign his employment effective as of April 3, 2009 (the
“Termination Date”),
WHEREAS, the Company desires to
retain the Executive to provide consulting services to the Company
following the Termination Date and wishes to provide the Executive
with certain compensation and benefits in return for
Executive’s services; and
WHEREAS, the Company and the
Executive now wish to document the termination of their employment
relationship, the Executive’s future consulting relationship
with the Company and to fully and finally to resolve all matters
between them;
THEREFORE, in exchange for the good
and valuable consideration set forth herein, the adequacy of which
is specifically acknowledged, the Executive and the Company hereby
agree as follows:
1. Termination of Employment
. The Executive’s employment with the Company, including his
position as Executive Vice President, Micro-Electronics
Technologies of the Company (and any other positions he may hold
with the Company or any of its subsidiaries), will terminate on the
Termination Date.
2. Consulting Period
.
(a) Consulting Period .
During the period commencing on the Termination Date and ending on
July 3, 2009 (the “Consulting Period”), the
Executive will continue to provide services to the Company.
Notwithstanding the foregoing, the Executive may terminate the
Consulting Period (and his obligation to provide consulting
services), with or without cause, upon delivery of written notice
to the Company. The Consulting Period may be extended upon mutual
agreement of the Executive and the Chief Executive Officer of the
Company. The date on which the Consulting Period ends for any
reason is referred to herein as the “Consulting Period
Termination Date.”
(b) Status as Consultant .
During the Consulting Period, the Executive shall be an independent
contractor of the Company and not an employee and shall report to
the General Counsel of the Company.
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(c) Scope of Services During
Consulting Period . The Executive shall devote such percentage
of his business time and effort to the performance of his services
hereunder as may be mutually agreed upon by the General Counsel of
the Company and the Executive. The Executive shall, upon the
request or direction of the Chief Executive Officer or the General
Counsel of the Company, provide such additional information, advice
and assistance concerning matters that are within (i) the
scope of the Executive’s knowledge and expertise, including
intellectual property and competitive strategy and (ii) the
scope of work agreed upon by the General Counsel of the Company and
the Executive under this Agreement. The Executive’s advice
shall be of an advisory nature and the Company shall not have any
obligation to follow such advice. The Executive agrees to perform
the consulting services and any other obligations or activities
hereunder in accordance with (i) the terms of this Agreement,
(ii) all applicable laws, and (iii) all Company policies
and procedures provided to the Executive in connection with
Executive’s performance under this Agreement.
(d) Availability . The
Executive generally shall be available to provide services under
this Agreement during normal business hours (“normal business
hours” being 9:00 a.m. to 5:00 p.m. Pacific Time on any day
excluding Saturday, Sunday and any day which is a legal holiday
under the laws of the State of California or is a day on which
banking institutions located in California are authorized or
required by law or other governmental action to close). Executive
shall make himself available to, and shall, perform his consulting
services reasonably following the request by Company but at such
particular times and places and using such methods as Executive
determines. Executive shall fulfill his responsibilities under this
Agreement by providing such services by telephone and e-mail, as
Executive may reasonably determine The Company shall reasonably
accommodate the Executive’s schedule when requesting the
Executive’s assistance pursuant to this
Section 2(d).
3. Compensation and Severance
.
(a) Compensation on Termination
Date . On the Termination Date, the Company shall pay the
Executive all accrued wages through the Termination Date, including
accrued, unused vacation and any other benefits owed to the
Executive. The Executive shall submit all business expenses
incurred by him no later than the Termination Date, in accordance
with the Company’s travel and expense policies. The Company
shall promptly reimburse the Executive for all reasonable and
properly documented business expenses that are submitted by him in
accordance with the Company’s policies and this
Section 3(a). In addition, the Company will also, within
thirty (30) days after the Termination Date, reimburse the
Executive in an amount not to exceed $2,000 for the reasonable cost
of legal services he incurs for himself to obtain legal advice
concerning this Agreement, which expenses shall be submitted to the
Company with supporting documentation no later than twenty-one
(21) days after the Termination Date. Subject to the terms of
this Agreement, the Executive acknowledges and agrees that with his
final check, and the expense reimbursements described above, the
Executive will have received all monies, bonuses, commissions,
expense reimbursement, vacation pay, or other compensation he
earned or was due during his employment by the Company.
(b) Compensation During
Consulting Period .
(i) Consulting Fee . During
the Consulting Period, Executive shall be entitled to receive an
amount equal to the Executive’s base salary as in effect
immediately prior to the Termination Date, payable in accordance
with the Company’s standard payroll practices.
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(ii) Health Benefits . During
the Consulting Period, the Company shall pay the employer
contribution for medical, dental, and vision coverage for the
Executive and covered dependents (if COBRA coverage is elected).
The Executive acknowledges that, following the Termination Date,
the Executive shall not be eligible to participate in any plan or
program which, as a condition of eligibility for such plan or
program, requires the Executive to be an employee of the
Company.
(iii) Business Expenses .
During the Consulting Period, the Company shall reimburse the
Executive for reasonable and pre-approved out-of-pocket business
expenses incurred in connection with the performance of his
services hereunder, subject to (A) such policies as the
Company may from time to time establish, and (B) the Executive
furnishing the Company with evidence in the form of receipts
satisfactory to the Company substantiating the claimed
expenditures.
(iv) Stock Awards . During
the Consulting Period, all of the Executive’s stock options
and restricted stock awards (other than restricted stock awards the
vesting of which is solely performance-based) shall continue to
vest and be exercisable in accordance with the terms of the stock
option agreements and the equity plans pursuant to which such stock
options were issued. Following the Termination Date, the Executive
shall not be entitled to any additional grants of stock options or
restricted stock.
(c) Severance Benefits . Upon
the termination of the Consulting Period for any reason, the
Executive (or in the event of the Executive’s death, the
Executive’s estate or designated beneficiary) shall be
entitled to receive, in lieu of any severance benefits to which the
Executive may otherwise be entitled under any severance plan or
program of the Company, the benefits provided below:
(i) Unpaid Consulting
Compensation . On the Consulting Period Termination Date, the
Company shall pay the Executive all accrued but unpaid consulting
fees payable pursuant to Section 3(b)(i) above, and any unpaid
health benefits payable pursuant to Section 3(b)(ii) above.
The Executive shall submit all business expenses incurred by him no
later than the Consulting Period Termination Date, in accordance
with the Company’s travel and expense policies. The Company
shall promptly reimburse the Executive for all reasonable and
properly documented business expenses that are submitted by him in
accordance with the Company’s policies and this
Section 3(c)(i).
(ii) Severance Payment .
Within seven (7) business days of the Second Release Effective
Date (as defined below), the Company shall pay to the Executive a
severance payment of $247,500 (the “Severance
Payment”), less all applicable taxes and other authorized
withholding.
(iii) Health Benefits . The
Company shall pay the employer contribution for medical, dental,
and vision coverage for the Executive and covered dependents (if
COBRA coverage is elected) for nine (9) calendar months after
the Consulting Period Termination Date. The Executive will then be
responsible for paying the full cost of continuation coverage under
COBRA for the Executive and eligible dependents should the
Executive elect to continue coverage after such period. This
coverage will cease on the date the Executive becomes employed by
another employer offering substantial similar medical benefit
coverage, and the Executive will promptly notify the Company in
writing of the occurrence of such an event.
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(iv) Stock Awards
.
(A) The vesting and exercisability
of each of the Executive’s outstanding stock options shall be
accelerated as to the number of shares subject to such stock
options that would vest over the nine (9) month period
following the Consulting Period Termination Date had the Executive
remained continuously employed by the Company during such period,
with such acceleration to be effective as of the Consulting Period
Termination Date. Following the Consulting Period Termination Date,
the Executive’s stock options shall be exercisable in
accordance with the terms of the stock option agreements and the
equity plans pursuant to which such stock options were
issued.
(B) The vesting of each of the
Executive’s outstanding restricted stock awards (other than
restricted stock awards the vesting of which is solely
performance-based) shall be accelerated as to the number of shares
of restricted stock that would vest over the nine (9) month
period following the Consulting Period Termination Date had the
Executive remained continuously employed by the Company during such
period, with such acceleration to be effective as of the Consulting
Period Termination Date. Following the Consulting Period
Termination Date, for so long as the Executive continues to serve
as a consultant to the Company pursuant to the Consulting
Agreement, the Executive’s unvested restricted stock awards
(other than restricted stock awards the vesting of which is solely
performance-based) shall continue to vest in accordance with the
terms of the restricted stock agreements and the equity plans
pursuant to which such restricted stock awards were
issued.
(C) As of the Termination Date, all
of the Executive’s restricted stock awards the vesting of
which is solely performance-based shall cease to vest. All such
unvested shares of restricted stock shall automatically, and
without further action by either the Company or the Executive, be
forfeited or repurchased by the Company pursuant to the terms of
the restricted stock agreements and the equity plans pursuant to
which such stock awards were issued. These unvested shares are
currently held in escrow and will be automatically cancelled and
transferred to the Company. The aggregate repurchase price, if any,
for these shares will be paid to the Executive on the Termination
Date.
(v) General Release of Claims by
the Executive . The Executive’s right to receive any of
the payments or other compensation to be made to the Executive
pursuant to this Section 3(c) shall be contingent on Executive
providing to the Company (and failing to revoke) a full and
complete general release in the form attached hereto as Exhibit
A (the “Second Release”) dated as of the Consulting
Period Termination Date and the Executive’s failure to revoke
such Second Release within the time period provided therein. The
date on which the Second Release becomes effective shall be
considered the “Second Release Effective
Date”).
4. General Release of Claims by
the Executive .
(a) In consideration of the benefits
received under this Agreement, the Executive, on behalf of himself
and his executors, heirs, administrators, representatives and
assigns, hereby agrees to release and forever discharge the Company
and all predecessors, successors and their respective parent
corporations, affiliates, related, and/or subsidiary entities, and
all of their past and present investors, directors, shareholders,
officers, general or limited partners, executives, attorneys,
agents and representatives, and employee benefit plans in which the
Executive is or has been a participant by virtue of his employment
with the Company, from any and all claims, debts, demands,
accounts, judgments, rights, causes of action, equitable relief,
damages, costs, charges, complaints, obligations, promises,
agreements, controversies, suits, expenses, compensation,
responsibility and liability of every kind and character whatsoever
(including attorneys’ fees and costs), whether in law or
equity, known or unknown, asserted or
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unasserted, suspected or unsuspected
(collectively, “Claims”), which the Executive has or
may have had against such entities based on any events or
circumstances arising or occurring on or prior to the date hereof
or on or prior to the Termination Date, arising directly or
indirectly out of, relating to, or in any other way involving in
any manner whatsoever the Executive ‘s employment by the
Company or the separation thereof, and any and all claims arising
under federal, state, or local laws relating to employment,
including without limitation claims of wrongful discharge, breach
of express or implied contract, fraud, misrepresentation,
defamation, or liability in tort, claims of any kind that may be
brought in any court or administrative agency, any claims arising
under Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act, the Americans with Disabilities
Act, the Older Workers Benefit Protection Act, the Fair Labor
Standards Act, the Employee Retirement Income Security Act, the
Family and Medical Leave Act, the Worker Adjustment and Retraining
Notification Act, the California Fair Employment and Housing Act,
the California Family Rights Act, the California Labor Code and
similar state or local statutes, ordinances, and regulations.
Notwithstanding the generality of the foregoing, the Executive does
not release the following claims and rights:
(i) Claims for: (a) indemnity
pursuant to California law (including but not limited to Cal. Labor
Code Section 2802), (b) indemnity pursuant to written
indemnification agreements which have been entered into between
Executive and the Company and any of its affiliates,
(c) coverage under any of the Company’s insurance
policies for third party claims based on Executive’s
employment with the Company, or (d) indemnity pursuant to the
Company’s certificate of incorporation or its
by-laws;
(ii) The right to bring to the
attention of the Equal Employment Opportunity Commission claims of
discrimination, or any claim that the waiver of claims under the
Age Discrimination in Employment Act of 1967 (“ADEA”)
was not knowing or voluntary; provided, however, that the Employee
does release his right to secure any damages for alleged
discriminatory treatment;
(iii) Any claim
