Exhibit 10.1

 

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EMPLOYMENT AGREEMENT

 

This Employment Agreement (this “Agreement”) is entered into as of
November 30, 2011 (the “Effective Date”) by and between Vitesse Semiconductor
Corporation, a Delaware corporation (“Vitesse”) and Martin Nuss (the
“Executive”).

 

In consideration of the foregoing and other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, Vitesse and Executive
hereby agree as follows:

 

1.                                       POSITION AND COMPENSATION

 

It is hereby agreed that Executive shall be employed by Vitesse as its Vice
President of Technology & Strategy. Executive shall be employed at a base salary
of $235,000 per year. Vitesse and Executive further agree that Executive’s base
salary shall be reviewed not less than once per year from the Effective Date of
this Agreement. Executive shall be eligible to participate in Vitesse’s bonus
plan for senior executives as from time to time in effect, subject to the terms
and conditions in the governing documents of such plan.

 

2.                                       EMPLOYEE STOCK INCENTIVE PLAN

 

(a)                                  Executive shall be eligible to receive
equity compensation awards under the Vitesse Semiconductor Corporation 2010
Incentive Plan (“2010 Incentive Plan”) as determined by the Board of Directors
of Vitesse or any duly authorized committee thereof (the “Board”) and consistent
with his position as Vice President of Technology & Strategy. Subject to
approval from Vitesse’s Compensation Committee, Executive may be eligible for
evergreen grants pursuant to Vitesse’s applicable policies and plan.

 

(b)                                 Acceleration of Vesting: In the event of a
Change of Control Event (as defined in the 2010 Incentive Plan) of the Company
(or its successor) and any involuntary termination other than For Cause (as
defined below) or Constructive Termination (as defined below) of Executive’s
employment within one year of such Change of Control Event, then, any vesting
associated with any equity compensation awards which Executive has been granted
prior to any such Change of Control Event shall be accelerated and shall
immediately become vested as though Executive had completed an additional two
(2) years of service with Vitesse, and shall be exercisable for an additional 90
days following the date of termination of Executive’s employment with the
Company.

 

(c)                                  “Constructive Termination” shall mean
Executive’s resignation for Good Reason; provided, however, that the term
Constructive Termination is applicable only to Section 2(b) of this Agreement,
and this Agreement shall not be deemed to establish or evidence that Executive’s
resignation for Good Reason constitutes a constructive termination, as that term
is used under California law.

 

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3.                                       BENEFITS

 

Employment benefits shall be provided to Executive in accordance with Vitesse’s
programs then available to its senior executives, as amended from time to time.
Executive will be eligible for sick leave as needed, subject to Vitesse’s
then-effective policies. Executive may participate in Vitesse’s Employee Stock
Purchase Plan, on the terms and conditions set out in such plan. Vitesse will
provide Executive with life insurance, with a benefit payable in the amount of
$280,000. Vitesse will provide Executive with long-term disability insurance,
with a benefit payable in the monthly amount of 60% of Executive’s monthly
salary, up to a limit of $10,000. Executive may, at his own expense, purchase
additional long-term disability insurance, with a benefit payable in the monthly
amount of 66.6% of Executive’s monthly salary, up to a limit of $15,000.
Executive shall also be eligible to participate in such health and other
voluntary insurance plans as may then be in effect for Vitesse employees.

 

4.                                       VACATION

 

Executive shall be entitled to three weeks of paid vacation per year. Unused
vacation time is subject to a limit on accrual and may be carried forward only
to the extent consistent with Vitesse’s then current policy with respect to
vacation time.

 

5.                                       TERMINATION OF EMPLOYMENT

 

Vitesse and Executive understand and agree that Executive’s employment may be
terminated under the circumstances and in accordance with the terms set forth
below:

 

(a)                                  By mutual agreement at any time with or
without notice; provided that such agreement must be stated in writing and
signed and dated by Executive and an authorized agent of Vitesse.

 

(b)                                 By either Vitesse or Executive at any time
and for any reason in writing, with or without prior notice.

 

(c)                                  By Vitesse For Cause. A termination of
employment “For Cause” is defined as termination by reason of (i) Executive’s
conviction of a felony or plea of guilty or nolo contendere to a felony;
(ii) Executive’s intentional failure or refusal to perform his employment duties
and responsibilities; (iii) Executive’s intentional misconduct that injures
Vitesse’s business; (iv) Executive’s intentional violation of any other material
provision of this Agreement or Vitesse’s code of business conduct and ethics; or
(v) as provided in Section 8 of this Agreement. Executive’s inability to perform
his duties because of death or Disability shall not constitute a basis for
Vitesse’s termination of Executive’s employment For Cause. Notwithstanding the
foregoing, Executive’s employment shall not be subject to termination For Cause
without Vitesse’s delivery to Executive of a written notice of intention to
terminate. Such notice must describe the reasons for the proposed employment
termination For Cause, and must be delivered to Executive at least fifteen (15)
days prior to the proposed termination date (the “Notice Period”). Executive
shall be provided an opportunity within the Notice Period to cure any such
breach (if curable) giving rise to the proposed termination, and shall be
provided an opportunity to be heard before the Board. Thereafter, the Board
shall deliver to Executive a written notice of termination after the expiration
of the Notice Period stating that a majority of the members of the Board have
found that Executive engaged in the conduct described in this Paragraph 5(c).

 

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(d)                                 Vitesse may terminate Executive’s employment
immediately upon his death or upon Vitesse’s provision to Executive of not less
than fifteen (15) days written notice to Executive that Vitesse has determined
that Executive is unable to continue to perform his job duties due to
Disability. “Disability” means a physical or mental impairment of Executive as
certified in a written statement from a licensed physician selected or approved
by the Board that renders Executive unable to perform his duties under this
Agreement (after reasonable accommodation, if necessary, by Vitesse that does
not impose an undue hardship on Vitesse) for one hundred and fifty (150)
consecutive days or for at least two hundred and ten (210) days (regardless of
whether such days are consecutive) during any period of three hundred sixty-five
(365) consecutive days, unless otherwise required by law. In conjunction with
determining the existence of a Disability, Executive consents to any reasonable
medical examinations (at Vitesse’s expense) that the Board determines are
relevant to a determination of Executive’s Disability, and agrees that Vitesse
is entitled to receive the written results of such examinations. To give effect
to this provision, Executive agrees to sign a written waiver of HIPAA rights in
conjunction with such examination(s). Executive agrees to waive any applicable
physician-patient privilege which may arise with respect to such examinations.

 

6.                                       SEVERANCE PAY

 

(a)                                  If Executive’s employment is terminated
(i) by mutual agreement, (ii) by Vitesse For Cause (iii) by Executive for other
than Good Reason (as defined below) or (iv) because of Executive’s Disability or
death, Executive (or Executive’s estate in the case of Executive’s death) shall
receive (A) Executive’s base salary and accrued, but unused, vacation pay
through Executive’s final day of employment, all of which shall be payable in a
lump sum on the date of termination of employment, and (B) any fully accrued and
unpaid bonus, if any has so accrued, but shall not be eligible to receive any
Severance Pay (as defined below) or any other bonus or other compensation,
unless agreed upon by both parties.

 

(b)                                 Benefits Payable Upon Certain Terminations.

 

(i)                                     If Executive’s employment is terminated
by Vitesse other than For Cause or by Executive for Good Reason and such
termination does not occur within the 12 month period following a Change in
Control Event, Executive shall receive (A) his base salary and accrued, but
unused, vacation pay through the termination date of his employment, all of
which shall be payable in a lump sum on the date of termination of employment,
and (B) 12 months of base salary. Base salary is defined at the rate prior to
any short-term salary reduction that may have occurred.

 

(ii)                                  If Executive’s employment is terminated by
Vitesse other than For Cause or by Executive for Good Reason and such
termination occurs within the 12 months period following a Change in Control
Event, Executive shall receive (A) his base salary and accrued, but unused,
vacation pay through the termination date of his employment, all of which shall
be payable in a lump sum on the date of termination of employment, (B) Severance
Pay, (C) Earned Bonus, (D) an additional bonus equal to fifty percent (50%) of
Executive’s maximum potential annual bonus for the fiscal year in which such
termination occurs; (E) cash payment (subject to applicable withholding) equal
to twelve (12) months of Executive’s medical and dental premiums in effect on
the day of termination pursuant to COBRA, and (F) acceleration of Vesting as
described in Section 2(b).

 

(iii)                               Executive’s right to receive any of the
benefits under Section 2(b) or under this Section 6 shall be conditioned upon
Executive’s execution of Vitesse’s then standard form of waiver and release of
claims.

 

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(c)                                  “Good Reason” means, without Executive’s
written consent, the occurrence of any of the following actions unless the
action is fully corrected (if possible) within fifteen (15) days after the Board
receives written notice from Executive of such action (which notice shall have
been provided by Executive within thirty (30) days of the occurrence of such
action), and provided that Executive actually terminates employment within
thirty (30) days following the end of such fifteen (15) day period: 
(i) Vitesse’s material reduction in Executive’s base salary; (ii) Vitesse’s
failure to pay Executive any material amount that is expressly required to be
paid under this Agreement; (iii) Vitesse’s material and adverse reduction of the
nature of Executive’s duties and responsibilities, disregarding mere changes in
title (for purposes of clarity, it is expressly agreed that if there is a Change
of Control Event (as defined below) and Executive is not offered the position of
Vice President of Technology & Strategy of the ultimate parent entity resulting
from the Change of Control Event on terms that are substantially equivalent to
the compensation paid to Vice Presidents of Technology & Strategy of similarly
sized technology companies, Executive shall have suffered a material and adverse
reduction of the nature of his duties and responsibilities); (iv) Vitesse’s
requirement that Executive perform his principal employment duties at an office
that is more than sixty (60) miles from Boulder, Colorado or (v) Vitesse
terminates this Agreement in accordance with Section 15 hereof (it being
understood by Executive that if prior to the termination date of this Agreement
Executive elects to terminate his employment for Good Reason based upon this
clause (v), Executive shall not have the right to set a termination date for his
employment prior to the termination date of this Agreement).

 

(d)                                 “Severance Pay” means nine (9) months of
Executive’s base salary, plus 1 week of base salary for every 12 months employed
by the Company. Base salary is defined at the rate prior to any short-term
salary reduction that may have occurred.

 

(e)                                  “Earned Bonus” means with respect to the
bonus plan applicable to Executive for the fiscal year when such termination
occurs (A) a pro-rata portion of Executive’s maximum potential annual bonus
(subject, however, to all threshold requirements in the bonus plan adopted by
Vitesse’s Board of Directors for the fiscal year in which such termination
occurs, including any performance standards or milestones that must be met
before any such bonus is payable), multiplied by (B) a pro-rata portion of the
fiscal year when such termination occurs (including the day of such
termination), and multiple by (C) a pro-rata portion of the bonus applicable to
any other goals satisfied by Executive, provided that the Board shall make a
good faith determination within 10 business days following Executive’s
Termination Date of the extent to which Executive either has satisfied such
goals as of such date or the extent to which he would have been reasonably
likely to have satisfied such goals during the fiscal year if Executive’s
employment had not otherwise terminated.

 

Example:

 

If

(A)                              Executive’s maximum bonus under the bonus plan
in effect at the time of Executive’s termination of employment was 50% of
Executive’s base salary;

(B)                                Executive’s employment is terminated 55 days
following the start of the fiscal year; and

(C)                                in making the determination of the amount of
the Earned Bonus the Board determines that Executive has satisfied 75% of
his/her bonus goals.

 

Then

Executive’s Earned Bonus = Executive’s base salary * 0.50 * 55/365 * 0.75.

 

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7.                                       EMPLOYMENT DUTIES

 

Executive will report to Vitesse’s Chief Executive Officer and shall perform all
duties assigned to him by the Chief Executive Officer. Executive’s duties may be
conveyed to him through a job description, or through other written or verbal
instructions from Vitesse’s Chief Executive Officer. Executive’s duties are
expected to involve travel from time to time to various locations and events,
and are expected to involve significant unpaid overtime. Executive will be
deemed an officer of Vitesse, and will be required to comply with and will be
subject to all SEC regulations applicable to officers pursuant to Section 16 of
the Securities Exchange Act of 1934.

 

8.                                       COMPLIANCE WITH VITESSE POLICIES AND
PROCEDURES

 

As a member of Vitesse management, Executive will be expected to comply with all
provisions of Vitesse’s Policies and Procedures and Employee Handbook, as
amended from time to time. Executive acknowledges, by signature on this
Agreement, that failure to comply with and ensure enforcement of Vitesse’s
policies and procedures and all federal and applicable state and local laws as
well as any applicable laws of any foreign country or political subdivision
thereof in the jurisdiction of which Vitesse conducts business, as such laws
relate to business operations, may result in immediate termination of employment
For Cause.

 

9.                                       CONFLICT OF INTEREST

 

Executive acknowledges that his position is a full-time position and agrees to
devote his entire productive time, ability and attention to Vitesse’s business.
Executive further agrees that while employed by Vitesse, he will not directly or
indirectly engage in outside employment, consulting or other business activities
unless he has obtained written consent from the Vitesse Board.

 

10.                                 NO SOLICITATION OF CUSTOMERS

 

Executive promises and agrees that during the term of this Agreement, Executive
will not, directly or indirectly, individually or as a consultant to, or as an
employee, officer, stockholder, director or other owner or participant in any
business, influence or attempt to influence customers, vendors, suppliers, joint
venturers, associates, consultants, agents, or partners of Vitesse, either
directly or indirectly, to divert their business away from Vitesse, to any
individual, partnership, firm, corporation or other entity then in competition
with the business of Vitesse, and he will not otherwise materially interfere
with any business relationship of Vitesse.

 

11.                                 SOLICITATION OF EMPLOYEES

 

Executive promises and agrees that during the term of this Agreement and for a
period of two (2) years thereafter, Executive will not, directly or indirectly,
individually or as a consultant to, or as an employee, officer, stockholder,
director or other owner of or participant in any business, solicit (or assist in
soliciting) any person who is then, or at any time within six (6) months prior
thereto was, an employee of Vitesse who earned annually $25,000 or more as an
employee of Vitesse during the last six (6) months of his or her own employment
to work for (as an employee, consultant or otherwise) any business, individual,
partnership, firm, corporation, or other entity whether or not engaged in
competitive business with Vitesse.

 

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12.                                 LIMITATION ON PAYMENTS

 

In the event that the severance and other benefits provided for in this
Agreement or otherwise payable to Executive (i) constitute “parachute payments”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the “Code”), and (ii) would be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then Executive’s benefits under
this Agreement shall be either (a) delivered in full, or (b) delivered as to
such lesser extent which would result in no portion of such benefits being
subject to the Excise Tax, whichever of the foregoing amounts, taking into
account the applicable federal, state and local income taxes and the Excise Tax,
results in the receipt by Executive on an after-tax basis, of the greatest
amount of benefits, notwithstanding that all or some portion of such benefits
may be taxable under Section 4999 of the Code. The payments or benefits subject
to any such reduction shall be reduced by Vitesse in its reasonable discretion
in the following order: (i) reduction of any payments and benefits otherwise
payable to Executive that are exempt from Section 409A of the Code, and
(ii) reduction of any other payments and benefits otherwise payable to Executive
on a pro-rata basis or such other manner that complies with Section 409A of the
Code, as determined by Vitesse.

 

Unless Vitesse and Executive otherwise agree in writing, any determination
required under this section shall be made in writing by Vitesse’s independent
public accountants (the “Accountants”), whose determination shall be conclusive
and binding upon Executive and Vitesse for all purposes. For purposes of making
the calculations required by this section, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of
Section 280G and 4999 of the Code. Vitesse and Executive shall furnish to the
Accountants such information and documents as the Accountants may reasonably
request in order to make a determination under this section. Vitesse shall bear
all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this section.

 

13.                                 SECTION 409

 

Vitesse makes no representations or warranties to Executive with respect to any
tax, economic or legal consequences of this letter or any payments or other
benefits provided hereunder, including without limitation under Section 409A of
the Code. However, the parties intend that this Agreement and the payments and
other benefits provided hereunder be exempt from the requirements of
Section 409A of the Code to the maximum extent possible, whether pursuant to the
short-term deferral exception described in Treasury Regulation
Section 1.409A-1(b)(4), the involuntary separation pay plan exception described
in Treasury Regulation Section 1.409A-1(b)(9)(iii), or otherwise. To the extent
Section 409A of the Code is applicable to this Agreement (and such payments and
benefits), the parties intend that this Agreement (and such payments and
benefits) comply with the deferral, payout and other limitations and
restrictions imposed under Section 409A of the Code. Notwithstanding any other
provision of this Agreement to the contrary, this Agreement shall be
interpreted, operated and administered in a manner consistent with such
intentions. Without limiting the generality of the foregoing, and
notwithstanding any other provision of this Agreement to the contrary, with
respect to any payments and benefits under this letter to which Section 409A of
the Code applies, all references in this letter to the termination of
Executive’s employment are intended to mean Executive’s “separation from
service,” within the meaning of Section 409A(a)(2)(A)(i) of the Code. In
addition, if Executive is a “specified employee,” within the meaning of
Section 409A(a)(2)(B)(i) of the Code, then to the extent necessary to avoid
subjecting Executive to the imposition of any additional tax under Section 409A
of the Code, amounts that would otherwise be payable under this Agreement during
the six-month period immediately following Executive’s “separation from
service,” within the meaning of Section 409A(a)(2)(A)(i) of the Code, will not
be paid to Executive during such period, but will instead be accumulated and
paid to Executive (or, in the event of Executive’s death, Executive’s estate) in
a lump sum on the first business day following the earlier of (a) the date that
is six months after Executive’s separation from service or (b) Executive’s
death. It is intended that each installment, if any, of any severance payments
shall be treated as a separate “payment” for purposes of Section 409A.

 

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14.                                 ARBITRATION

 

In the event of any dispute, controversy, or claim relating to or arising out of
Executive’s employment relationship with Vitesse; this Agreement or any alleged
breach, default, or misrepresentation in connection with any of the provisions
of this Agreement; or the termination of Executive’s employment with Vitesse for
any reason (including, but not limited to, any claims of breach of contract,
wrongful termination, or age, sex, race, national origin, sexual orientation,
religion, disability or other discrimination or harassment), Executive and
Vitesse agree that all such disputes shall be fully, finally, and exclusively
resolved by binding arbitration before a sole neutral arbitrator to the fullest
extent permitted by law. The arbitration will be conducted by JAMS in Ventura
County, California in accordance with its “Employment Arbitration Rules &
Procedures” or such later-adopted successor rules then in effect and shall be
subject to JAMS Policy on Employment Arbitration Minimum Standards of Procedural
Fairness. Information regarding the rules of JAMS and copies of such rules can
be found at http://www.jamsadr.com. The parties will select a neutral
arbitrator, or if they cannot agree on one, JAMS will select a neutral
arbitrator. The Company will pay any costs of arbitration, including the
arbitrator’s fees, that would not be borne by an individual filing an action in
court. Each party shall have the right to such discovery as is reasonably
necessary to develop and prosecute his, her, or its case. The parties agree that
in any proceeding with respect to such matters, each party shall bear its own
attorney’s fees and costs, unless the arbitrator otherwise orders. The
arbitrator may grant any relief that would be available in a court of competent
jurisdiction. The arbitrator will render a written decision that sets out his or
her findings and reasoning in sufficient detail to allow for review of the
decision. This is a mutual agreement; Executive and Vitesse are both required to
arbitrate all such disputes relating to or arising out of Executive’s employment
relationship with Vitesse. The parties acknowledge and agree that they are
hereby waiving any rights to trial by jury in any action, proceeding or
counterclaim brought by either of the parties against the other in connection
with any matter whatsoever arising out of or in any way connected with any of
the matters referenced in this section. Except with respect to actions seeking
injunctive relief pursuant to Code of Civil Procedure section 1281.8, Executive
and Vitesse both waive their rights to file an action in court with regard to
any matter referred to in this section. Judgment on the arbitrator’s award may
be entered in any court having jurisdiction.

 

15.                                 AT-WILL EMPLOYMENT

 

Vitesse agrees to employ Executive, and Executive agrees to serve Vitesse in
accordance with the terms of this Agreement. Executive’s employment shall be AT
WILL employment, meaning that Executive’s employment can be terminated by
Vitesse or by Executive at any time, with or without notice, for any reason or
for no reason. Such termination may, however, be subject to payment of a
Severance Package, as more particularly described in Section 6.

 

16.                                TERM

 

Subject to the provisions of Sections 5 and 15 herein, the Term of this
Agreement, shall be indefinite.

 

17.                                 PARTIAL INVALIDITY

 

It is the desire and intent of Vitesse and Executive that the provisions of this
Agreement be enforced to the fullest extent permissible under applicable
federal, state and municipal laws. Accordingly, if any specific provision or
portion of this Agreement is determined to be invalid or unenforceable within
the particular jurisdiction in which enforcement is sought, that portion of the
Agreement will be considered as deleted for the purposes of adjudication. All
other portions of this Agreement will be considered valid and enforceable within
that jurisdiction.

 

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18.                                 ENTIRE AGREEMENT

 

Vitesse and Executive understand and agree that this Agreement constitutes the
full and complete understanding and agreement between them regarding the terms
of Executive’s employment and supersedes all prior understandings,
representations, and agreements with respect to the employment. Vitesse and
Executive understand that the Vitesse SIP and the Compensation Adjustment forms
(if any) referred to in this Agreement shall be fully incorporated into this
Agreement by reference. The parties rights and obligations hereunder may not be
assigned without the consent of each party hereto, except that Vitesse may
assign its rights and obligations hereunder to any successor entity. Executive
agrees that following a Change in Control Event, “Vitesse” shall refer to any
successor entity.

 

19.                                 EXECUTIVE ACKNOWLEDGEMENT

 

Executive acknowledges that he has read and understands this Employment
Agreement and agrees to the terms and conditions contained herein. Executive
agrees that he has had the opportunity to confer with legal counsel of his
choosing regarding this Agreement. Executive further acknowledges that this
Agreement has not been executed by Executive in reliance upon any representation
or promise except those contained herein, and that Vitesse has made no guarantee
regarding Executive’s employment other than those specified in this Agreement.

 

20.                                 GOVERNING LAW

 

This Agreement shall be construed in accordance with and governed by the laws of
the State of California without regard to conflicts of law principles.

 

 

“EXECUTIVE”

 

 

 

 

1/18/2012

 

/s/ Martin Nuss

Dated

 

Martin Nuss

 

 

 

 

 

 

 

VITESSE SEMICONDUCTOR CORPORATION,
a Delaware Corporation

 

 

 

 

1/23/2012

 

/s/ Christopher Gardner

Dated

 

Christopher Gardner
Chief Executive Officer

 

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