EXHIBIT 10.2

 

[CONFIDENTIAL TREATMENT HAS BEEN REQUESTED BY WJ COMMUNICATIONS, INC.
CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED AND HAVE BEEN
SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.]

 

WJ COMMUNICATIONS, INC.

401 RIVER OAKS PARKWAY

SAN JOSE, CALIFORNIA 95134

January 28, 2005

 

Wilfred K. Lau

2215 Red Oak Lane
Richardson, Texas 75082

 

 Re:                            Employment Agreement

 

 Dear Mr. Lau:

 

This letter agreement (this “Agreement”) sets forth the terms and conditions of
your employment with WJ Communications, Inc. (the “Company”), effective as of
the date first above written (the “Effective Date”).

 

1.                                       Employment and Services.  The Company
shall employ you as Senior Vice President-RFID of WJ Communications, Inc., for
the period beginning on the Effective Date and ending upon termination pursuant
to paragraph 4 (the “Employment Period”).  During the Employment Period, you
shall be located at the Company’s offices in Richardson, Texas, but you shall
also be required to travel to the Company’s principal headquarters from time to
time. Your responsibilities include the diligent and good faith pursuit of the
RFID business plan, operational site management for the Richardson, TX facility,
strategic RFID business development, and other special projects and assignments
as designated by the Company’s Chief Executive Officer. You will report directly
to the Chief Executive Officer and shall render such services to the Company and
its affiliates and subsidiaries as the Chief Executive Officer shall reasonably
designate from time to time.  You shall devote your best efforts and full time
and attention to the business of the Company.  You will also be a member of the
Company’s senior management staff and you will directly participate in the
weekly, senior management business, staff meetings and decision making
processes.  During the Employment Period, you agree not to sit on any for-profit
Boards (or comparable bodies) without the consent of the Chief Executive
Officer.

 

2.                                       Compensation.

 

a.                                       Annual Base Salary.  The Company shall
pay you an annual base salary (“Annual Base Salary”) of $175,000 during the
Employment Period, subject to annual review in each year of the Employment
Period thereafter (for any partial year during the Employment Period, the Annual
Base Salary shall be prorated based on the number of days during such year on
which you are

 

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employed by the Company).  The first such annual review will occur on or about
one year from the Effective Date.  Your Annual Base Salary may be increased in
years following the first year of employment but may not be decreased.  As used
herein, the term “Annual Base Salary” refers to the Annual Base Salary as so
increased.  Such Annual Base Salary shall be payable in installments in
accordance with the Company’s regular payroll practices, but no less frequently
than monthly.

 

b.                                      Bonus.  In addition, you will be
eligible to receive a quarterly bonus, to be paid as soon as practicable but not
later than the earlier of (i) one hundred twenty (120) days after the end of
such quarter or (ii) the date on which other members of senior management
receive their respective bonuses, if any.  In order to determine the amount of
such bonus, the Company shall determine appropriate business and financial
targets for each fiscal year for the Company and for you and your annual bonus
shall be based upon the extent to which the Company and you attain such
targets.  Your maximum total annual bonus shall be 50% of your Annual Base
Salary.  The determination of the appropriate business and financial targets
with respect to each subsequent fiscal year shall take place not later than
thirty (30) days following the receipt by the Board of Directors of the Company
from the Company’s senior management of the Company’s operating budget with
respect to such fiscal year.

 

c.                                       Equity.  You will be eligible to
participate in the Company’s Restricted Stock Incentive Program (or any current
or future similar such program) (the “Stock Program”), pursuant to which the
Company rewards exceptional performance through grants of the Company’s
restricted stock to employees.  Also, in the future, as approved by the
Company’s Board of Directors, you may be eligible for option grants based upon
the Company’s and your individual performance.

 

d.                                      Withholding.  Notwithstanding anything
herein to the contrary, there shall be deducted or withheld from all amounts
payable to you amounts for all federal, state, city or other taxes required by
applicable law to be so withheld or deducted and any other amounts authorized
for deduction by or required by law.

 

3.                                       Benefits.  During the Employment
Period, you shall be entitled to participate in the Company’s fringe benefit
plans for its senior management staff, subject to and in accordance with
applicable eligibility requirements, such as medical, dental, tax preparation,
401(k) (matching contributions of up to 3%), employee stock purchase program,
life and disability insurance plans and all other benefit plans generally
available to the Company’s senior executive officers, in each case, on terms and
at a cost to you, no less favorable than other members of the Company’s senior
management staff.  In addition, the Company will reimburse your reasonable
out-of-pocket expenses incurred in connection with the performance of your
duties hereunder, consistent with Company policy.  You shall be entitled to take
paid time off in accordance with the Company’s top management vacation, holiday
and illness policy.  As part of the senior management staff, you will also be
eligible for the executive medical reimbursement program, which supplements the
standard health plan available to the Company’s employees and provides for
payment of up to $5,000 per year for yourself and your family.

 

4.                                       Termination.  The Employment Period
shall terminate on the first to occur of (i) ninety (90) days following written
notice by you to the Company of your resignation without Good Reason (it being
understood that you will continue to perform your services hereunder during such
ninety (90) day period if requested, but the Company may terminate your services
sooner if it so elects), (ii) thirty (30) days following written notice by you
to the Company of your resignation with Good Reason (it being understood that
you will continue to perform your

 

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services hereunder during such thirty (30) day period provided that the Company
does not elect to terminate your employment sooner if it so elects), (iii) your
death or Disability, (iv) a vote of the Board of Directors of the Company
directing your termination for Cause, (v) a vote of the Board of the Company
directing your termination without Cause, or (vi) the third (3rd) anniversary of
the Effective Date (the “Scheduled Expiration Date”); provided, however, that
the Scheduled Expiration Date shall be automatically extended for successive
one-year periods unless, at least thirty (30) days prior to the then-current
Scheduled Expiration Date, either the Company or you shall give written notice
to the other of an intention not to extend the Employment Period.  In the event
of termination of the Employment Period pursuant to clause (ii) or (v) above,
the Company shall pay to you a series of monthly payments over the next twelve
(12) month period immediately following such termination.  Each monthly payment
shall be paid periodically in accordance with the Company’s regular payroll
practices (but no less frequently than monthly) and be equal to one-twelfth
(1/12th) of your Annual Base Salary as in effect immediately prior to the
termination of the Employment Period (the “Severance Benefit”).

 

Except as otherwise set forth in this paragraph 4 or pursuant to the terms of
employee benefit plans in which you participate pursuant to paragraph 3, you
shall not be entitled to any compensation or other payment from the Company in
connection with the termination of your employment hereunder.

 

For purposes of this Agreement, the following definitions will apply:  (a) “Good
Reason” shall mean the occurrence of any of the following without your consent
which shall remain uncured for a period of not less than forty-five (45) days
following your delivery of notice of such occurrence to the Company (it being
understood that your failure to deliver such notice in a timely manner shall
waive your rights to allege Good Reason):  (i) the assignment of you by the
Company to any duties materially inconsistent with, or a material diminution of,
your position, including duties, title, offices, or responsibilities, (ii) the
transfer of your principal place of employment to a geographic location more
than 50 miles from both your current personal residence and from the location of
your current principal place of employment; or (iii) any material breach of this
Agreement by the Company which is not cured within fifteen (15) days after the
Company has received written notice from you identifying the breach in
reasonable detail; (b) “Cause” shall mean any of the following acts or
circumstances:  (i) willful destruction by you of Company property having a
material value to the Company, (ii) fraud, embezzlement, theft, or comparable
dishonest activity committed by you against the Company, (iii) your conviction
of or entering a plea of guilty or nolo contendere to any crime constituting a
felony or any misdemeanor involving fraud, dishonesty or moral turpitude, (iv)
your breach, neglect, refusal, or failure to discharge, in each case, in any
material respect, your duties under this Agreement (other than due to
Disability) commensurate with your title and function or any Company policy or
your failure to comply with the lawful directions of the President and Chief
Executive Officer or Board of Directors, in any material respect, in any such
case that is not cured within fifteen (15) days after you have received written
notice thereof from the President and Chief Executive Officer or Board of
Directors of the Company, or (v) a willful and knowing material
misrepresentation to the President and Chief Executive Officer or the Board of
Directors of the Company; and (c) “Disability” shall mean that for a period of
three (3) consecutive months or an aggregate of four (4) months in any twelve
(12) month period you are incapable of substantially fulfilling the duties of
your positions as set forth in paragraph 1 because of physical, mental or
emotional incapacity, injury, sickness or disease. Any question as to the
existence or

 

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extent of the Disability upon which you and the Company cannot agree shall be
determined by a qualified, independent physician selected by the Company.  The
determination of any such physician shall be final and conclusive for all
purposes; provided, however, that you or your legal representatives shall have
the right to present to such physician such information as to such Disability as
you or they may deem appropriate, including the opinion of your personal
physician.

 

5.                                       Maintaining Confidential Information.

 

a.                                       Company Information.  You agree at all
times during the term of your employment and thereafter to hold in confidence,
and not to use, except for the benefit of the Company, or to disclose to any
person, firm or corporation without written authorization of the Chief Executive
Officer of the Company, any trade secrets, confidential knowledge, data or other
proprietary information relating to products, processes, know-how, designs,
formulas, developmental or experimental work, computer programs, data bases,
other original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to any business of the Company or
any of its clients, consultants, or licensees. We agree that it shall not be a
breach of this paragraph if you disclose information which becomes generally
known to and available for use by the public (other than as a result of your
acts or omissions to act).  The restrictive covenants contained in this
Section 5 shall not apply after the Employment Period if and to the extent the
Company fails to make any payment of Annual Base Salary, bonus, or Severance
Benefit to you then due, provided, further, that this limitation shall not apply
unless the Employment Period ends on or after the fourth anniversary of the
Effective Date; accordingly, you acknowledge and agree that the restrictive
covenants contained in the Non-Competition Agreement dated on the Effective Date
(the “Non-Competition Agreement”) will apply on the terms contained therein
without regard to the terms of this Agreement as the Non-Competition Agreement
was entered into in connection with the acquisition of your ownership interest
in Telenexus, Inc. and consideration was paid by us therefor.

 

b.                                      Former Employer Information.  You agree
that you will not, during your employment with the Company, improperly use or
disclose any proprietary information or trade secrets of your former or
concurrent employers or companies, if any, and that you will not bring onto the
premises of the Company any unpublished document or any property belonging to
your former or concurrent employers or companies, if any, unless consented to in
writing by such employers or companies.

 

c.                                       Third Party Information.  You recognize
that the Company has received and in the future will receive from third parties
their confidential or proprietary information subject to a duty on the Company’s
part to maintain the confidentiality of such information and to use it only for
certain limited purposes.  You agree that you owe the Company and such third
parties, during the term established by such third parties, a duty to hold all
such confidential or proprietary information conveyed to you and which has been
expressly described as being confidential pursuant to contract, in confidence
and not to disclose it to any person, firm or corporation (except as necessary
in carrying out your work for the Company consistent with the Company’s
agreement with such third party) or to use it for the benefit of anyone other
than for the Company or such third party (consistent with the Company’s
agreement with such third party) without the express written authorization of
the Chief Executive Officer of the Company.  The Company agrees to provide you
with a copy of any agreement with a third party, or any redacted portion of such
agreement relating to confidentiality, that does, or could reasonably be deemed
to, restrict your disclosures and activities hereunder.

 

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6.                                       Retaining and Assigning Inventions and
Original Works.

 

a.                                       Inventions and Original Works Retained
by You.  You have attached hereto, as Exhibit A, a list describing all
inventions, original works of authorship, developments, improvements, and trade
secrets which were made by you prior to your employment with the Company, which
belong to you, which reasonably relate to the Company’s business and products,
and which are not assigned to the Company.  If you have no such inventions or
original works, you will so indicate on the attached list.

 

b.                                      Inventions and Original Works Assigned
to the Company.  You agree that you will promptly make full written disclosure
to the Company, will hold in trust for the sole right and benefit of the
Company, and will assign to the Company all your right, title, and interest in
and to any and all inventions, original works of authorship, developments,
improvements or trade secrets which you have solely or jointly conceived or
developed or reduced to practice, or caused to be conceived or developed or
reduced to practice, during the period of time you have been in the employ of
the Company or which you may solely or jointly conceive or develop or reduce to
practice, during the period of time you shall be in the employ of the Company. 
You and the Company recognize, however, this provision does not apply to any
invention as to which you can prove the following (an “Excluded Invention”):

 

i.                                          It was developed entirely on your
own time; and

 

ii.                                       No equipment, supplies, facility or
trade secret of the Company was used in its development; and

 

iii.                                    It neither

 

(1)                                  relates at the time of its conception or
reduction to practice to the business of the Company or to the Company’s actual
or demonstrably anticipated research and development; nor

 

(2)                                  results from any work performed by you for
the Company.

 

You acknowledge that all original works of authorship which have been and will
be made by you (solely or jointly with others) within the scope of your
employment and which are protectable by copyright are “works made for hire,” as
that term is defined in the United States Copyright Act (17 USCA Section 101).

 

c.                                       Maintenance of Records.  You agree to
keep and maintain adequate and current written records of all inventions and
original works of authorship made by you (solely or jointly with others) during
the term of your employment with the Company.  The records will be in the form
of notes, sketches, drawings, and any other format that may be specified by the
Company in writing.  The records will be available to and remain the sole
property of the Company at all times.

 

d.                                      Inventions Assigned to the United
States.  You agree to assign to the United States government all your right,
title, and interest in and to any and all inventions, original works of
authorship, developments, improvements or trade secrets, other than with respect
to Excluded Inventions, whenever such full title is required to be in the United
States by a contract between the Company and the United States or any of its
agencies.

 

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e.                                       Obtaining Letters Patent and Copyright
Registrations.  You agree that your obligation to assist the Company to obtain
United States or foreign letters patent and copyright registrations covering
inventions and original works of authorship assigned hereunder to the Company
shall continue beyond the termination of your employment, but the Company shall
compensate you at a reasonable rate for time actually spent by you at the
Company’s request on such assistance.  If the Company is unable because of your
mental or physical incapacity or for any other reason to secure your signature
(after making a good faith and reasonable attempt to do so) to apply for or to
pursue any application for any United States or foreign letters patent or
copyright registrations covering inventions or original works of authorship
assigned to the Company as above, than you hereby irrevocably designate and
appoint the Company and its duly authorized officers and agents as your agent
and attorney in fact, to act for and in your behalf and stead, to execute and
further the prosecution and issuance of letters patent or copyright
registrations thereon with the same legal force and effect as if executed by
you.  You hereby waive and quitclaim to the Company any and all claims, of any
nature whatsoever, which you now or may hereafter have for infringement of any
patents or copyright resulting from any such application for letters patent or
copyright registration assigned hereunder to the Company.

 

f.                                         Exception to Assignments.  You will
advise the Company promptly in writing of any inventions, original works of
authorship, developments, improvements or trade secrets that you believe meet
the criteria in Subparagraphs 6b(i), (ii), and (iii) above for Excluded
Inventions; and you will at that time provide to the Company in writing all
evidence necessary to substantiate that belief.  You understand that the Company
will keep in confidence and will not disclose to third parties without your
consent any confidential information disclosed in writing to the Company
relating to Excluded Inventions that qualify under the foregoing Subparagraphs.

 

7.                                       Conflicting Employment.  You agree
that, during the term of your employment with the Company, you will not engage
in any other employment, occupation, consulting or other business activity
directly or indirectly related to the business in which the Company is now
involved or becomes involved during the term of your employment, nor will you
engage in any other activities that conflict with your obligations to the
Company.  If you wish to engage in any other employment during the time you are
engaged by the Company, you will first obtain the Company’s written consent
before accepting such additional employment.

 

8.                                       No Breach of Duty.  You represent that
your performance of all the terms of this Agreement and as an employee of the
Company does not, and to the best of your present knowledge and belief, will not
breach any agreement or duty to keep in confidence proprietary information
acquired by you in confidence or in trust prior to your employment by the
Company.  You have not entered into, and you agree you will not enter into, any
agreement either written or oral in conflict herewith.  You are not at the
present time restricted from being employed by the Company or entering into this
Agreement.

 

9.                                       Returning Company Documents.  You agree
that, at the time of leaving the employ of the Company, you will deliver to the
Company (and will not keep in your possession or deliver to anyone else) any and
all devices, records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any aforementioned items belonging to
the Company, its successors, affiliates or assigns.  In the event of the
termination of your employment, you agree to sign and deliver the “Termination
Certification” attached hereto as Exhibit B.

 

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10.                                 Non-Solicitation; Non-Competition.

 

a.                                       Non-Solicitation.  As a means
reasonably designed to protect the Company’s proprietary information, you agree
that, during the term of this Agreement and for a period of twelve (12) months
from the conclusion of the Employment Period, you will not directly or
indirectly, either as an individual on his own account or as a partner, joint
venturer, officer, director, stockholder, employee, agent, independent
contractor, or otherwise:

 

(i)                                     counsel, solicit, or attempt to induce
any person employed by the Company, whether that person is a full-time employee,
part-time employee, or independent contractor, to terminate his or her
employment or independent contractor relationship with the Company;

 

(ii)                                  employ any person formerly employed by the
Company, whether that person was a full-time employee, part-time employee, or
independent contractor; or

 

(iii)                               solicit to provide, or provide, any of the
Company’s customers or prospective customers with any product or service that
competes with any product or service sold or provided by the Company.

 

The restrictive covenants contained in this Section 10 shall not apply after the
Employment Period if and to the extent the Company fails to make any payment of
Annual Base Salary, bonus, or Severance Benefit to you then due, provided,
further, that this limitation shall not apply unless the Employment Period ends
on or after the fourth anniversary of the Effective Date; accordingly, you
acknowledge and agree that the restrictive covenants contained in the
Non-Competition Agreement will apply on the terms contained therein without
regard to the terms of this Agreement as the Non-Competition Agreement was
entered into in connection with the acquisition of your ownership interest in
Telenexus, Inc. and consideration was paid by us therefor.

 

b.                                      Non-Competition.  During the term of
your employment by the Company and for a period of twelve (12) months after the
conclusion of the Employment Period, you shall not, directly or indirectly,
either as an individual on his own account or as a partner, joint venturer,
officer, director, stockholder, employee, agent, independent contractor, or
otherwise:

 

(i)                                     engage in a Competitive Business (as
hereinafter defined);

 

(ii)                                  have any interest in any person, firm,
partnership, joint venture, or other business entity (collectively, an “Entity”)
which is engaged in a Competitive Business (except as a stockholder holding less
than one percent of the aggregate number of issued and outstanding shares of a
publicly traded company’s capital stock); or

 

(iii)                               provide financial or other assistance or act
as an agent of, consultant for or advisor to any Entity which is or is about to
become engaged in a Competitive Business.

 

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The restrictive covenants contained in this Section 10 shall not apply after the
Employment Period if and to the extent the Company fails to make any payment of
Annual Base Salary, bonus, or Severance Benefit to you then due, provided,
further, that this limitation shall not apply unless the Employment Period ends
on or after the fourth anniversary of the Effective Date; accordingly, you
acknowledge and agree that the restrictive covenants contained in the
Non-Competition Agreement will apply on the terms contained therein without
regard to the terms of this Agreement as the Non-Competition Agreement was
entered into in connection with the acquisition of your ownership interest in
Telenexus, Inc. and consideration was paid by us therefor.

 

“Competitive Business” shall mean the business of the sale, manufacture or
distribution of (i) any RFID product, (ii) any product set forth on Exhibit C
hereto (or any products that are substantially similar to those on such Exhibit
C) or which compete with those set forth on Exhibit C hereto, or (iii) any
integrated circuit, electronic component or semiconductor module product in the
field of wireless communications infrastructure, cable television networks and
distribution plant, RF identification readers and programmers, and wireless
networking for use in equipment used by telecommunications service providers to
receive and transmit information by electrical, electronic, optical, or
electro-optic means to and from other telecommunication service providers or
telecommunication service users in any industry and for any application.

 

c.                                       Scope of Restriction.  If, at the time
of enforcement of this paragraph 10, a court shall hold that the duration, scope
or area restrictions stated herein are unreasonable under circumstances then
existing, the parties hereto agree that the maximum duration, scope or area
reasonable under such circumstances shall be substituted for the stated
duration, scope or area.

 

d.                                      Equitable Relief.  You acknowledge that
the provisions contained in paragraphs 5, 6 and 10 hereof are reasonable and
necessary to protect the legitimate interests of the Company, that any breach or
threatened breach of such provisions will result in irreparable injury to the
Company and that the remedy at law for such breach or threatened breach would be
inadequate.  Accordingly, in the event of the breach by you of any of the
provisions of paragraphs 5, 6 and 10 hereof, the Company, in addition and as a
supplement to such other rights and remedies as may exist in its favor, may
apply to any court of law or equity having jurisdiction to enforce this
Agreement, and/or may apply for injunctive relief against any act than would
violate any of the provisions of this Agreement.  Such right to obtain
injunctive relief may be exercised, at the option of the Company, concurrently
with, prior to, after, or in lieu of, the exercise of any other rights or
remedies that the Company may have as a result of any such breach or threatened
breach.

 

11.                                 Survival.  Any termination of your
employment or of this Agreement shall have no effect on the continuing operation
of paragraphs 4, 5, 6, or 10 for the periods specified therein.

 

12.                                 Governing Law.  This Agreement and all
questions concerning the construction, validity and interpretation of this
Agreement shall be governed by and determined in accordance with the internal
law, and not the law of conflicts, of the State of Texas.

 

13.                                 Notices.  All demands, notices and
communications hereunder shall be in writing and shall be deemed to have been
duly given, if mailed, by registered or certified mail, return receipt
requested, or, if by other means, when received by the other party at the
address set forth herein, or such other address as may hereafter be furnished to
the other party by like notice. Notice or communication hereunder shall be
deemed to have been received on the date delivered to or received at the
premises of the addressee if delivered other than by mail, and in the case of
mail, three days

 

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after the depositing of the same in the United States mail as above stated (or,
in the case of registered or certified mail, by the date noted on the return
receipt).  Notices shall be addressed as follows:

 

 

If to the Executive:

 

Wilfred K. Lau

 

 

 

2215 Red Oak Lane

 

 

 

Richardson, Texas 75082

 

 

 

 

 

If to the Company:

 

WJ Communications, Inc.

 

 

 

401 River Oaks Parkway

 

 

 

San Jose, CA 95134

 

 

 

Attention:  Michael R. Farese

 

 

 

 

 

with a copy to:

 

Shumaker, Loop & Kendrick, LLP

 

 

 

101 East Kennedy Blvd.

 

 

 

Suite 2800

 

 

 

Tampa, Florida

 

 

 

Attention:  W. Thompson Thorn, III, Esquire

 

14.                                 Severability.  Any part, provision,
representation or warranty of this Agreement which is prohibited or which is
held to be void or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof.

 

15.                                 Successors and Assigns; Assignment of
Agreement.  This Agreement shall bind and inure to the benefit of and be
enforceable by the parties hereto.  As used in this Agreement, “Company” shall
mean the Company as hereinbefore defined and any successors to its businesses
and/or assets as aforesaid which assume and agree to perform this Agreement by
operation of law, or otherwise.  This Agreement is personal to you and without
the prior written consent of the Company shall not be assignable by you.

 

16.                                 Waiver; Amendment.  The failure of any party
to insist upon strict performance of a covenant hereunder or of any obligation
hereunder, irrespective of the length of time for which such failure continues,
shall not be a waiver of such party’s right to demand strict compliance in the
future. No consent or waiver, express or implied, to or of any breach or default
in the performance of any obligation hereunder, shall constitute a consent or
waiver to or of any other breach or default in the performance of the same or
any other obligation hereunder.  No term or provision of the Agreement may be
waived unless such waiver is in writing and signed by the party against whom
such waiver is sought to be enforced.  This Agreement shall not be modified
except in writing executed by all parties hereto.

 

17.                                 Entire Agreement.  This Agreement
constitutes the entire agreement between the parties hereto with respect to the
subject matter contemplated herein and supersedes all prior agreements, whether
written or oral, between the parties, relating to the subject matter hereof. 
Notwithstanding the foregoing, the parties acknowledge that they are parties to
the Non-Competition Agreement executed on the Effective Date and that the
Non-Competition Agreement applies to your activities as well and could apply for
a period longer than the restrictions on your activities set forth in this
Agreement.

 

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18.                                 Captions.  Titles or captions of paragraphs
contained in this Agreement are inserted only as a matter of convenience and for
reference, and in no way define, limit, extend or describe the scope of this
Agreement or the intent of any provision hereof.

 

19.                                 Counterparts.  For the purpose of
facilitating proving this Agreement, and for other purposes, this Agreement may
be executed simultaneously in any number of counterparts.  Each counterpart
shall be deemed to be an original, and all such counterparts shall constitute
one and the same instrument.

 

20.                                 Arbitration.  The parties to this Agreement
acknowledge and agree that any claim arising out of or relating to this
Agreement or the breach of this Agreement, including, without limitation, any
claims sounding in contract, tort, breach of contract, violation of statute, or
otherwise and including claims for which a party seeks an injunction or other
equitable relief, must be submitted and resolved by binding arbitration.  All
questions pertaining to the arbitrability of a particular claim or defense shall
be determined by the arbitrator or arbitrators.  Judgment upon the award
rendered by the arbitrator or arbitrators may be entered in any court having
jurisdiction thereof.  Any such arbitration will be administered in Dallas,
Texas by the American Arbitration Association under its Rules of the Commercial
Panel of the American Arbitration Association then in effect (and not the
Employment Dispute Resolution Rules).  The parties agree that if it becomes
necessary to arbitrate any claim arising out of or relating to this Agreement or
the breach of this Agreement after the date hereof, that they will not argue at
that time that resolution of any claims in such forum will cause an undue
hardship on them or their witnesses.  The award entered by the arbitrator will
be final and binding in all respects.

 

Please execute a copy of this letter Agreement in the space below and return it
to the undersigned at the address set forth above to confirm your understanding
and acceptance of the agreements contained herein.

 

 

Very truly yours,

 

 

 

WJ COMMUNICATIONS, INC.

 

 

 

By:

 

 

Name:

Michael R. Farese

 

Title:

President and Chief Executive Officer

 

 

 

Accepted and agreed to:

 

 

 

 

 

 

 

 

Wilfred K. Lau

 

 

 

10

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EXHIBIT A

 

LIST OF PRIOR INVENTIONS

AND ORIGINAL WORKS OF AUTHORSHIP

 

TITLE

 

DATE

 

IDENTIFYING NUMBER
OR BRIEF DESCRIPTION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Intellectual property associated with previously filed patent applications
benefiting Advanced IP Communications, Inc. and all modifications, extensions or
supplements thereto.

 

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EXHIBIT B

WJ COMMUNICATIONS, INC.

TERMINATION CERTIFICATION

 

This is to certify that I do not have in my possession, nor have I failed to
return, any devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, or reproductions of any aforementioned
items belonging to WJ Communications, Inc., its subsidiaries, affiliates,
successors or assigns (together, the “Company”).

 

I also agree, in compliance with the Employment Agreement, that for a period of
12 months after the date my employment with the Company concludes, I shall
comply with the restrictive covenants contained in paragraph 10 of the
Employment Agreement.

 

I further agree that, in compliance with the Employment Agreement, I will
preserve as confidential all trade secrets, confidential knowledge, data or
other proprietary information relating to products, processes, know-how,
designs, formulas, developmental or experimental work, computer programs, data
bases, other original works of authorship, customer lists, business plans,
financial information or other subject matter pertaining to any business of the
Company or any of its clients, consultants or licensees in accordance with
Section 5 of the Employment Agreement.

 

Date:

 

 

 

 

 

Employee’s Signature

 

 

 

 

 

 

Name of Employee (typed or printed)

 

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EXHIBIT C

 

LIST OF RESTRICTED PRODUCTS

 

1.                                       EXISTING CUSTOMER PRODUCTS (UNDER ANY
PRODUCT NAME WHATSOEVER) DEVELOPED BY TELENEXUS, INC. INCLUDING, WITHOUT
LIMITATION, THE FOLLOWING:

 

Area Antenna (***)

Stationary Reader (***)

Handheld Reader (***)

Advanced Reader (***)

*** Indicator (***)

RF Module (***)

Japanese Reader (***)

Rugged Reader (with PA) (***)

Multiplexer (***)

*** Reader (***)

RF Module with retrofit (***)

Specialty Reader (***)

Direct Sequence Reader (***)

Drop Box Antenna (***)

European Reader (***)

Junction Card/Highway System (***)

Tag 21 (***)

*** Reader (***)

*** Reader (***)

Service Center Programmer (***)

RF Module (with Antenna) (***)

RF Module (9 volt)/Class 0 Antenna (***)

Interface Board/Box (***)

Low Cost Reader (***)

Multiprotocol RF Module (***)

Antenna Interface Boards and Cables (***)

SCA Reader, Tag, and Antenna (***)

Tag-It™ Reader (***)

Multiprotocol Reader (***)

Digital Control Board (***)

Wave Reader (***)

DSP Module (***)

7/eleven Reader (***)

SMU Reader (***)

 

--------------------------------------------------------------------------------

***                           CONFIDENTIAL MATERIAL REDACTED PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT AND SEPARATELY FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION.

 

--------------------------------------------------------------------------------

 

Brazil Development (***)

Tracking Device (***)

*** Reader (***)

TaxMedCS (***)

*** Reader (***)

PCMCIA Multiprotocol Reader

Application software for above

 

2.                                       EXISTING TELENEXUS DEVELOPED PRODUCTS
(UNDER ANY PRODUCT NAME WHATSOEVER) INCLUDING, WITHOUT LIMITATION, THE
FOLLOWING:

 

IR 1000

IR 1500

RM 1000

DR 1000

AN 125

AN 110

AN 120

 

3.                                       TELENEXUS PRODUCTS CURRENTLY UNDER
DEVELOPMENT (UNDER ANY PRODUCT NAME WHATSOEVER) INCLUDING, WITHOUT LIMITATION,
THE FOLLOWING:

 

Class 3 Tags and Reader (***)

*** Products

IR 2000

IR 2500

SR 2000

RM 2000

DR 2000

DP 2000

 

4.                                       FUTURE RFID-BASED PRODUCTS (UNDER ANY
PRODUCT NAME WHATSOEVER) INCLUDING, WITHOUT LIMITATION, THE FOLLOWING:

 

IR 3000

IR 3500

SR 3000

RM 3000

DR 3000

DP 3000

 

--------------------------------------------------------------------------------

***                        CONFIDENTIAL MATERIAL REDACTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION.

 

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