Amended & Restated Employment Agreeement



 






Exhibit 10.5




AMENDED & RESTATED EMPLOYMENT AGREEMENT




     The parties to this Amended and Restated Employment Agreement (this “Agreement”), dated as of
March 14, 2005, are Artesyn Technologies, Inc., a Florida corporation (the “Company”), and Joseph
M. O’Donnell (the “Executive”). The Company and the Executive currently are parties to an
Employment Agreement dated January 1, 2000 (the “Existing Employment Agreement”). The Executive is
presently the President and Chief Executive Officer of the Company and the parties wish to provide
for the continued employment of the Executive in such positions, from and after the date of this
Agreement (the “Effective Date”), subject to the terms provided herein. The parties intend that
the Existing Employment Agreement be updated by this Agreement to reflect the current employment
terms and compensation arrangements between the Company and the Executive that have been adopted
and approved by the Company’s Board of Directors (the “Board”) (or, as applicable, the Compensation
and Stock Option Committee of the Board (the “Compensation Committee”)) consistent with the
Existing Employment Agreement and the Company’s practices and policies.



     Accordingly, the parties, intending to be legally bound, agree that the Existing Employment
Agreement is amended and restated in its entirety as follows:



     1. Employment.



     1.1 General. The Company hereby employs the Executive in the positions and
capacities of President and Chief Executive Officer, and the Executive hereby accepts such
employment, subject to the terms and conditions herein contained. In such capacities, the
Executive agrees faithfully to perform (i) all duties delineated in the By-laws of the Company
relating to his positions as President and Chief Executive Officer, (ii) such duties and
responsibilities as are customary for an executive with similar titles and positions at similar
publicly-traded companies and (iii) such additional duties (consistent with his positions as
President and Chief Executive Officer) as may reasonably be assigned to the Executive from time to
time by the Board of Directors of the Company (the “Board”). The Executive shall report directly
and regularly to the Board. The Executive shall from time to time during the Employment Term (as
defined in Section 4 hereof), communicate and consult with such member(s) of the Board as is
designated by the Board. Subject to the foregoing, the Executive shall not be required to report
to or take direction from any particular individual.



     1.2 Boards and Committees. The Company shall cause the Executive, during the
Employment Term, to continue to be renominated for election to the Board. The Executive will
serve, if appointed, on any committee(s) of the Board, and on any board(s) of directors and/or
committee(s) of any subsidiaries of the Company, all without further compensation.



     1.3 Full-Time Position. The Executive hereby agrees that, during the Employment Term
he shall devote all of his business time, attention and skills to the business and affairs of



 









 





the Company and its subsidiaries, except during vacation time as provided by Section 3.4 hereof and
any periods of illness. The Executive agrees that, during the Employment Term, he will not seek
employment with another entity. Subject to the foregoing, nothing in this Agreement shall restrict
the Executive from (i) managing his personal investments, personal business affairs and other
personal matters, (ii) serving on the boards of directors of companies that do not compete directly
or indirectly with the Company, (iii) serving on civic or charitable boards or committees or (iv)
delivering lectures, fulfilling speaking engagements or teaching at educational institutions;
provided that none of such activities, either singly or in the aggregate, interfere with
the performance of his duties under this Agreement. The Executive must receive approval of the
Board prior to assuming any other directorships. It is hereby acknowledged that the Executive has
received the necessary approvals to serve as a member of the Board of Directors of Parametric
Technology Corporation.



     2. Compensation.



     2.1 Salary. Subject to the terms and conditions herein contained, during the
Employment Term, the Company shall pay to the Executive, and the Executive shall accept, for all
services to be rendered by him pursuant to this Agreement (including, but not limited to, any
services that may be rendered by him to any subsidiary of the Company and any services that may be
rendered by him as a member of the Board or the board of any such subsidiary or any committee(s)
thereof) a base salary of $560,000 per annum, and subject to increases, if any, as may be approved
from time to time by the Board or the Compensation Committee in its discretion (such amount,
together with any applicable increases, shall be referred to herein as the “Base Salary”). The
Executive’s Base Salary shall be payable in such installments as are in effect from time to time in
accordance with the regular payroll practices of the Company.



     2.2 Incentive Payment. In addition to his Base Salary, the Executive shall be
entitled to receive an incentive payment in respect of each calendar year during the Employment
Term (an “Incentive Payment”) as such may be awarded pursuant to, and in accordance with, the terms
of the Company’s Executive Incentive Plan, as then in effect. For purposes of this Agreement, a
payment of one hundred eighty-two percent (182%) of the Base Salary, or such higher percentage as
may be approved from time to time by the Board or the Compensation Committee in its discretion, is
hereinafter referred to as the “Maximum Incentive Payment.”



     2.3 Equity Compensation. The Company agrees that the Executive shall, at the sole
discretion of the Compensation Committee, be eligible for an annual grant of stock options or other
award of equity compensation under the terms of any stock incentive plan maintained by the Company,
as then in effect.



     3. Additional Benefits.



     3.1 Expenses. The Company shall reimburse the Executive (upon the submission by him
of reasonably itemized accounts therefor), or advance to the Executive, where appropriate, an
amount for such costs and expenses as the Executive shall reasonably incur (including, among other
things, business travel and business entertainment expenses) in connection with the



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performance by him of his duties hereunder in accordance with the Company’s policy with
respect thereto as in effect from time to time during the Employment Term. In addition, the
Executive shall be entitled to, and the Company shall provide, reimbursement of amounts paid by him
for the annual planning and preparation of his tax returns in an amount reasonable and customary
for executives of similar status.



     3.2
General Fringe Benefits. The Executive shall be entitled to, and the Company shall
provide, such fringe benefits of the Company, including, but not limited to, participation in
employee health and benefit plans and the Company’s purchase of health and/or disability insurance,
which the Company may from time to time generally offer its senior executive officers during the
Employment Term and for which the Executive is eligible. In addition, the Executive shall be
entitled to, and the Company shall provide, an annual executive physical exam and participation in
the medical executive reimbursement plan (MERP), on a basis consistent with the terms, conditions
and administration of such plan, and a non-accountable pre-tax car allowance of $900 per month,
subject to increases, if any, as may be approved from time to time by the Board or the Compensation
Committee in its discretion.



     3.2.1 Life Insurance/Supplemental Retirement. In order to provide a supplemental
retirement benefit for the Executive, the Company shall pay, as they become due, the premiums on
the following two (2) whole life insurance policies on the life of the Executive, each policy
having a face amount of $250,000: (i) Northwestern Mutual Life Policy No. 12 758 004 (whole life
policy with adjustable term protection), which policy currently has, the Executive hereby
represents, an annual premium of $14,705.00, and (ii) Northwestern Mutual Life Policy No. 11 882
114 (whole life policy paid-up at age 100), which policy currently has, the Executive hereby
represents, an annual premium of $5,295.00. The quarterly premiums shall be timely paid by the
Company upon submission of the quarterly premium payment vouchers therefor.



     3.2.2 Other Insurance Matters. The Executive hereby agrees that the Company may
continue, renew and/or purchase term or other insurance (whether group or individual) on his life
pursuant to which the Company is or shall be, as the case may be, the beneficiary and further
agrees to take all reasonable actions, including undergoing a physical examination, requested by
the Company in order to facilitate its continuing, renewing and/or obtaining such insurance.



     3.3 Employee-Managed Time Off. The Executive shall be entitled to twenty-eight (28)
days of employee-managed time off annually during the Employment Term. The Executive shall provide
the Board with reasonable prior notice of his planned vacation(s). To the extent under the
Company’s Employee-Managed Time Off Plan the Executive has accrued carry-over hours, the Executive
shall be entitled to such accrual, or the economic equivalent paid in a lump sum upon his
termination for any reason, in an amount not to exceed 800 hours.



     3.4 Other Benefits. Nothing in this Agreement shall prevent the Company from, or
obligate the Company to, increase compensation (including without limitation any Base Salary or
Incentive Payment), any other payments or any other benefits to the Executive, or from deciding to
provide the Executive with any benefits in addition to those provided for herein. Subject to the
foregoing, the Compensation Committee, will review the Executive’s compensation annually.



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     4. Term of Employment. The Executive’s employment hereunder shall commence on the
Effective Date and shall continue through December 31, 2005; provided, however,
that commencing on December 31, 2005 and on each December 31 thereafter (each, a “Renewal Date”),
the term of the Executive’s employment hereunder shall automatically be extended for one (1)
additional year unless, not later than 60 days prior to a Renewal Date, the Executive or the
Company shall have given written notice to the other that he or it does not wish to extend this
Agreement. The Executive’s employment under this Agreement shall be subject to earlier termination
under Section 5.



     The period of such employment is herein referred to as the “Employment Term”. The scheduled
expiration of the Employment Term shall not be deemed to be a termination of the Employment Term
hereunder, except as provided in Section 5.6.5 hereof.



     5. Termination.



     5.1 Death. The Employment Term shall terminate automatically in the event of the
Executive’s death during the Employment Term and upon such termination, the obligations, duties and
liabilities of the Company to the Executive shall solely be as set forth in Section 5.6.1 hereof.



     5.2 Disability. In the event of the Executive’s failure to perform his duties by
reason of his becoming Disabled (as defined herein) during the Employment Term, the Company shall
have the option to terminate the Employment Term, by giving written notice of such termination to
the Executive, which notice shall specify the effective date of termination. Upon such
termination, the Executive shall have no further duties hereunder (except as set forth in Section 7
hereof) and the obligations, duties and liabilities of the Company to the Executive shall solely be
as set forth in Section 5.6.1 hereof. For purposes of this Agreement, the term “Disabled” shall
mean the inability of the Executive, for medical reason(s) certified by a physician selected by the
Company and reasonably satisfactory to the Executive, to substantially perform his duties hereunder
for an aggregate of at least 180 days during any period of 365 consecutive days.



     5.3 By the Company for Cause. The Company may, at its option, terminate the
Employment Term, for any of the following reasons (each a “Cause”), upon five (5) business days’
prior written notice to the Executive that a meeting of the Board will be held to consider such
action, at which meeting the Executive and his counsel shall be afforded an opportunity to be heard
(a “Hearing”). Upon such termination, the Executive shall have no further duties hereunder (except
as set forth in Section 7 hereof) and the obligations, duties and liabilities of the Company to the
Executive shall solely be as set forth in Section 5.6.2 hereof:



     5.3.1 Violation of Law. If the Executive is convicted of a felony under Federal or
state law, the Board may terminate the Employment Term by written notice to the Executive, which
termination shall be effective, if not rescinded, immediately after the date of the Hearing.



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     5.3.2 Failure to Perform. If, without the prior express written consent of the Board,
the Executive fails to perform, in any material respect, any of his duties or obligations under
Sections 1.1, 1.2, 1.3, 7.2, 7.3 or 7.4 hereof (other than as a result of being Disabled as to
which Section 5.2 hereof could apply), and if such failure continues for more than thirty (30) days
after a Hearing is held in respect thereof, then the Board may terminate the Employment Term
immediately after said thirty (30) day period; provided, however, that if such
failure is incapable of being cured, in the good faith determination of the Board, the Employment
Term shall terminate immediately after the date of the Hearing.



     The parties hereto acknowledge and agree that matters of the business judgment of the
Executive or the economic performance of the Company or any segment thereof shall not be factors in
determining Cause, except to the extent that they involve gross negligence or willful misconduct.



     5.3.3 Other Actions. If, without the prior express written consent of the Board, the
Executive takes actions or omits to take actions in connection with his duties and/or
responsibilities hereunder that constitute willful misconduct or gross negligence and such actions
or omissions adversely affect the business, reputation, or financial or other condition of the
Company, the Board may terminate the Employment Term by written notice to the Executive, which
termination shall be effective immediately after the date of the Hearing.



     The parties hereto acknowledge and agree that matters of the business judgment of the
Executive or the economic performance of the Company or any segment thereof shall not be
factors in determining Cause, except to the extent that they involve gross negligence or willful
misconduct.



     5.4 By the Company Without Cause. In addition (and without prejudice) to its right to
terminate the Employment Term under the provisions of Section 5.3 hereof, the Company may, at its
option, terminate the Employment Term for any reason whatsoever by giving written notice of
termination to the Executive from the Board, specifying the date of termination. Upon such
termination, the Executive shall have no further duties hereunder (except as set forth in Section 7
hereof) and the obligations, duties and liabilities of the Company to the Executive shall solely be
as set forth in Section 5.6.3 hereof.



     5.5 By the Executive For “Substantial Breach.” As used herein, “Substantial Breach”
shall mean the Company’s material breach of this Agreement, including but not limited to, without
the Executive’s consent, the assignment to the Executive of positions or duties materially
inconsistent with the provisions of this Agreement, a material diminution of the Executive’s
position, authority, responsibilities or benefits to which he is then entitled hereunder, any
reduction of the compensation provided for in Section 2.1 and 2.2 hereof, the relocation of
corporate headquarters further than a fifty mile radius from the present headquarters, or the
Company’s common stock no longer being publicly traded under The Nasdaq Stock Market or a national
stock exchange. In the event that the Executive wishes to terminate the Employment Term due to a
Substantial Breach by the Company, the Executive shall send a written notice to the Company
notifying the Company of the breach within one hundred twenty (120) days of such



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breach. If such breach is not corrected within thirty (30) days after receipt of such notice,
then the Executive may, in his sole discretion, elect to terminate the Employment Term by giving
written notice of such election to the Company, and upon receipt by the Company of such an
election, the Employment Term shall terminate. Upon such termination, the Executive shall have no
further duties hereunder (except as set forth in Section 7 hereof) and the obligations, duties and
liabilities of the Company to the Executive shall solely be as set forth in section 5.6.3 hereof.



     5.6 Payments Upon Termination. In the event that the Employment Term is terminated
hereunder, the Company shall pay to the Executive the following amounts and any amounts due under
Section 3.3 hereof, and the Company shall thereupon have no liability or other obligation of any
kind or character under or in connection with this Agreement (the effective date of any such
termination is hereinafter referred to as the “Termination Date”):



     5.6.1 Death or Disability. In the event that the Employment Term is terminated
pursuant to Section 5.1 or Section 5.2 hereof, the Company shall pay to the Executive or to the
Executive’s executor, administrator, beneficiary or personal representative (the “Representative”),
as the case may be, the following:



     (i) the Base Salary due and owing through the Termination Date, payable in accordance with the
Company’s regular payroll practices;



     (ii) the Base Salary from the Termination Date through one year from the date thereof, payable
in accordance with the Company’s then regular payroll practices; provided, however, that
any Company-funded disability or life insurance or substantially similar disability or death
benefits payable to the Executive or to his Representative, as the case may be, (excluding life
insurance provided under Section 3.2.1 hereof) solely an account of such death or disability shall
offset payments of Base Salary under this subsection (ii) if such insurance and/or benefit amounts
are payable prior to the due date(s) of such payment(s) hereunder; and further provided, that any
life insurance proceeds shall not be utilized to offset any payments made to the Executive on
account of any disability; and



     (iii) the Maximum Incentive Payment.



     In addition, the Executive or his Representative, as the case may be, shall, to the extent
allowable under the law, COBRA limits or the provisions of the applicable plan, continue to receive
during such twelve (12) month period following the Termination Date all benefits and service
credits for benefits under medical, insurance and other employee benefit plans and programs
described in Sections 3.2 and 3.4 hereof and to which he was entitled at the Termination Date
(collectively, the “Benefits”).



     5.6.2 By the Company for Cause. In the event that the Employment Term is terminated
pursuant to Section 5.3 hereof, the Company shall pay to the Executive his Base Salary due and
owing to him through the Termination Date payable in accordance with the Company’s regular payroll
practices.



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     5.6.3 By the Company without Cause or By the Executive for Substantial Breach. In the
event that the Employment Term is terminated pursuant to Section 5.4 or Section 5.5 hereof, the
Company shall pay to the Executive (i) the balance of the Base Salary and Maximum Incentive Payment
due and owing through the Termination Date payable in accordance with the Company’s regular payroll
practices; (ii) an amount equal to two times the sum of the Base Salary and Maximum Incentive
Payment, payable in twenty-four (24) equal monthly installments after the Termination Date, in
accordance with the Company’s then regular payroll practices, provided, however,
that the last twelve (12) payments shall not be paid by the Company if the Executive is found to be
in breach of Section 7 hereof; and (iii) the costs and expenses of outplacement related services
which the Executive shall reasonably incur in an amount not to exceed $45,000 (upon the submission
by him of reasonably itemized invoices therefor).



     In addition, the Executive shall continue to receive, to the extent allowable by law, the
Benefits during the period set forth in clause (ii) above. To the extent such Benefits under COBRA
cannot be provided by law after a period of eighteen (18) months, the Company will reimburse the
Executive an amount equivalent to the cost of such Benefits under COBRA to the Executive for the
remaining six (6) month period.



     5.6.4 Effect of Change of Control.



     (a) Payment Upon Termination.



     If a Change of Control (as hereinafter defined) occurs prior to a termination of the
Employment Term, then in the event of the subsequent termination of the Employment Term pursuant to
section 5.4 or Section 5.5 hereof, the Company shall, in lieu of the amount otherwise payable under
Section 5.6.3 hereof, immediately upon the Termination Date, pay to the Executive a lump-sum
payment equal to (i) the sum of the Executive’s Base Salary and the Maximum Incentive Payment
multiplied by three (3), and (ii) the value of the Benefits to which the Executive would otherwise
be entitled if such Benefits were continued for a period of three (3) years after the Termination
Date (which, if the Executive and the Company cannot agree on such value, shall be conclusively
determined by Watson Wyatt & Company within fifteen (15) days of the Termination Date).
Notwithstanding the foregoing, the Executive shall not be entitled to receive any payments under
Section 5.6.4 hereof, in the event the Company sells its Power Conversion business but still
continues to own at least fifty one (51%) percent interest in its Communications Products business.



     In order for the Executive to become entitled to the payments pursuant to this subsection (a)
as a result of a termination pursuant to Section 5.5 hereof, he shall be required to provide the
notice referred to in such Section.



     (b) Change of Control Defined. A “Change of Control” shall be deemed to have occurred
upon any of the following events:



     (i) The consummation of any of the following transactions: (A) a merger, recapitalization or
other business combination of the Company with or into another corporation, or an acquisition



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of securities or assets by the Company, pursuant to which the Company is not the continuing or
surviving corporation or pursuant to which all or substantially all of the shares of the Company’s
common stock are converted into cash, securities of another corporation or other property, other
than a transaction in which the holders of the Company’s common stock immediately prior to such
transaction (including any preliminary or other transactions relating to such transaction) shall
continue to own at least 50% of the total voting power of the then-outstanding securities of the
surviving or continuing corporation immediately after such transaction, (B) any sale, lease,
exchange, or other transfer (in one transaction or a series of related transactions) of all, or
substantially all, of the assets of the Company or (C) the liquidation or dissolution of the
Company, except in connection with the voluntary or involuntary declaration of bankruptcy or
insolvency under applicable Federal and/or state law;



     (ii) A transaction in which any Person (as such term is used in Sections 13(d)(3) and
14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), corporation or
other entity (other than the Company, an affiliate of the Company, or any profit-sharing, employee
ownership or other employee benefit or similar plan sponsored by the Company or any of its
subsidiaries, or any trustee of or fiduciary with respect to any such plan when acting in such
capacity, or any group comprised solely of such entities): (A) shall purchase common stock (or
securities convertible into common stock) representing at least 40% of the total voting power of
the then-outstanding securities of the Company for cash, securities or any other consideration
pursuant to a tender offer or exchange offer, or (B) shall become the “beneficial owner” (as such
term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly (in one transaction
or a series of related transactions), of securities of the Company representing 50% or more of the
total voting power of the then-outstanding securities of the Company ordinarily (and apart from the
rights accruing under special circumstances) having the right to vote in the election of the
Company’s directors; or



     (iii) If, during any period of two (2) consecutive years, individuals who at the beginning of
such period constituted the entire Board and any new director whose election by the Board or
nomination for election by the Company’s stockholders was approved by a vote of at least a majority
of the directors then still in office who either were directors at the beginning of the period or
whose election or nomination for election by the stockholders was previously so approved, cease for
any reason to constitute a majority thereof.



     (c) Certain Additional Payments by the Company.



     (i) Anything in this Agreement to the contrary notwithstanding, in the event it shall be
determined that any payment or distribution to or for the benefit of the Executive (whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Company, any person whose actions result in a Change in Control
or any Person affiliated with the Company or such Person, but determined without regard to any
additional payments required under this Section 5.6.4(c) (a “Payment”)) would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) or
any interest or penalties are incurred by the Executive with respect to such excise tax (such
excise tax, together with any such interest and penalties, are hereinafter



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collectively referred to as the “Excise Tax”), then the Executive shall be entitled to receive
an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive
of all taxes (including any interest or penalties imposed with respect to such taxes), including,
without limitation, any income taxes (and any interest and penalties imposed with respect thereto)
and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payments.



     (ii) Subject to the provisions of paragraph (ii) of this Section 5.6.4(c), all determinations
required to be made under this Section 5.6.4(c), including whether and when a Gross-Up Payment is
required and the amount of such Gross-up Payment and the assumptions to be utilized in arriving at
such determination, shall be made by a nationally recognized certified public accounting firm
designated by the Executive (the “Accounting Firm”), which shall provide detailed supporting
calculations both to the Company and the Executive within fifteen (15) business days after receipt
of notice from the Executive that there has been a Payment, or such earlier time as is requested by
the Company. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any
Gross-Up Payment, as determined pursuant to this Section 5.6.4(c), shall be paid by the Company to
the Executive within five (5) days of the receipt of the Accounting Firm’s determination. Any
determination by the Accounting Firm shall be binding upon the Company and the Executive. As a
result of the uncertainty in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will
not have been made by the Company should have been made (“Underpayment”) consistent with the
calculations required to be made hereunder. In the event that the Company exhausts its remedies
pursuant to paragraph (iii) of this Section 5.6.4(c) and the Executive thereafter is required to
make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to
or for the benefit of the Executive.



     (iii) The Executive shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of the Gross-Up Payment. Such
notification shall be given as soon as practicable but no later than ten (10) business days after
the Executive is informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The Executive shall not pay
such claim prior to the expiration of the thirty (30) day period following the date on which it
gives such notice to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to
the expiration of such period that it desires to contest such claim, the Executive shall:




(A) give the Company any information reasonably requested by the Company relating to such
claim;




(B) take such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including, without limitation, accepting



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legal representation with respect to such claim by an attorney reasonably selected by the
Company;




(C) cooperate with the Company in good faith in order effectively to contest such claim; and




(D) permit the Company to participate in any proceedings relating to such claim;



provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or
income tax (including interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the foregoing provisions of
this paragraph (iii) of Section 5.6.4(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forego any and all
administrative appeals, proceedings, hearings and conferences with the taxing authority in respect
of such claim and may, at its sole option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall determine; provided,
however, that if the Company directs the Executive to pay such claim and sue for a refund,
the Company shall advance the amount of such payment to the Executive, on an interest-free basis
and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with respect thereto) imposed with respect to such
advance or with respect to any imputed income with respect to such advance; and provided,
further, that any extension of the statute of limitations relating to payment of taxes for
the taxable year of the Executive with respect to which such contested amount is claimed to be due
is limited solely to such contested amount. Furthermore, the Company’s control of the contest shall
be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.



     (d) If, after the receipt by the Executive of an amount advanced by the
Company pursuant to paragraph (c) of this Section 5.6.4, the Executive becomes entitled
to receive any refund with respect to such claim, the Executive shall (subject to the
Company’s complying with the requirements of paragraph (iii) of this Section 5.6.4(c) promptly pay
to the Company the amount of such refund (together with interest paid or credited thereon after
taxes applicable thereto). If after the receipt by the Executive of an amount advanced by the
Company pursuant to paragraph (iii) of this Section 5.6.4(c), a determination is made that the
Executive shall not be entitled to any to any refund with respect to such claim and the Company
does not notify the Executive in writing of its intent to contest such denial of refund prior to
the expiration of thirty (30) days after such determination, then such advance shall be forgiven
and shall not be required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.



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     5.6.5 Non-Renewal By the Employer. If the Company shall give notice of non-renewal of
the Employment Term in accordance with the provisions of Section 4 hereof, the Company shall pay to
the Executive an amount equal to two times the sum of the Base Salary and the Maximum Incentive
Payment, payable in twenty-four (24) equal monthly installments after the end of the Employment
Term payable in accordance with the Company’s then regular payroll practices.



     The parties hereto hereby agree that, for the purposes of this Section 5.6.5, the Termination
Date shall be the date upon which the Executive’s employment hereunder is scheduled to expire
pursuant to Section 4 hereof, unless the parties hereto mutually agree to an earlier date.



     Upon the payment of the foregoing amount to the Executive, the Company shall have no liability
or other obligation of any kind or character under or in connection with this Agreement, except
with respect to Section 7 hereof.



     Following the Executive’s attainment of the age of 65 years, all obligations and liabilities
of the Company under this Section 5.6.5 in respect of its decision not to renew the Executive shall
forthwith terminate.



     6. Arbitration.



     6.1 General. Any dispute under this Agreement arising out of or relating to Section 5
hereof shall be settled by arbitration in accordance with this Section 6.



     6.2 Commencement. Either party may serve upon the other party written notice that the
dispute, specifying the nature thereof, shall be submitted to arbitration. Within ten (10) days
after the service of such notice, each of the parties shall designate a person as an arbitrator and
serve written notice of such appointment upon the other party. If either party fails within the
specified time to appoint such arbitrator, the other party (if such party shall timely designate an
arbitrator) shall be entitled to appoint both arbitrators. The two arbitrators so appointed shall
appoint a third arbitrator. If the two arbitrators appointed shall fail to agree upon a third
arbitrator within ten (l0) days after their appointment, then an application may be made by either
party hereto, upon written notice to the other party, to the American Arbitration Association, or
any successor thereto, or if the American Arbitration Association or its successor shall fail to
appoint a third arbitrator within ten (10) days after such request, then either party may apply,
with written notice to the other, to any court of competent jurisdiction for the appointment of a
third arbitrator, and any such appointment so made shall be binding upon both parties hereto.



     6.3 Applicable Rules and Procedures. The arbitration shall be conducted, to the
extent consistent with this Section 6, in accordance with the then prevailing rules and procedures
of the American Arbitration Association or its successor. The arbitrators shall have the right to
retain and consult experts and competent authorities skilled in the matters under arbitration, but
all consultations shall be made in the presence of both parties, who shall have full right to
cross-examine the experts and authorities. Unless otherwise agreed by the parties, any such
arbitration



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shall take place in Boca Raton, Florida, and shall be conducted in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.



     6.4 Decision. The arbitrators shall render their award, upon the concurrence of at
least two of their number, not later than thirty (30) days after the appointment of the third
arbitrator. Their decision and award shall be in writing, and counterpart copies shall be
delivered to each of the parties. Such decision of the arbitrators shall be final and binding upon
the parties hereto. In rendering their award, the arbitrators shall have no power to modify any of
the provisions of this Agreement, and the jurisdiction and power of the arbitrators are expressly
limited accordingly. Judgment may be entered on the award of the arbitrators and may be enforced
in any court having jurisdiction.



     Each of the parties hereto shall bear all of its/his own fees, costs and expenses, including
attorneys’ fees, incurred by it in connection with any arbitration proceeding pursuant to this
Section 6. Notwithstanding the foregoing, in the event any party fails to comply with the decision
of the arbitrators and the other party undertakes any action(s) or proceeding(s) to enforce such
compliance, all costs and expenses (including reasonable legal fees) incurred by the party seeking
to enforce such compliance shall be borne by the party failing to so comply.



     7. Non-disclosure; Non-compete; Availability.



     7.1 “Confidential Information” Defined. “Confidential Information” shall mean any and
all information (verbal and written) of the Company or any of its subsidiaries or with respect to
any of their activities including, but not limited to, information relating to the Company’s
technology; research; test procedures and results; manufacturing machinery and equipment;
manufacturing processes; financial information; products; identity of raw materials and services
used; purchasing; trade secrets; costs; pricing; engineering; customers and prospects; marketing;
and selling and servicing; provided, that Confidential Information shall not include
information of a general, non-proprietary nature generally known in the industry and Company
specific information that in such form is or becomes publicly available other than through improper
means in which the Executive participated or of which he has knowledge.



     7.2 Non-Disclosure of Confidential Information. The Executive hereby agrees that he
shall not, at any time during the Employment Term (other than as may be required in connection with
the performance by him of his duties hereunder) or thereafter, directly or indirectly, use,
communicate, disclose or disseminate any Confidential Information in any manner whatsoever (except
as may be required under legal process by subpoena or other court order), without the prior written
consent of the Company.



     7.3 Non-compete Covenant. The Executive hereby agrees that he shall not, during the
Employment Term and for a period of twelve (12) months after the Termination Date (as long as he is
entitled to and duly receives any payments due to him pursuant to Section 5.6.3 hereof), directly
or indirectly engage in any business (whether as owner, manager, operator, lender, partner,
stockholder, licensor, licensee, joint venturer, employee, consultant or otherwise) in which the
Company or any of its subsidiaries, as of the Termination Date, is engaged as a



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significant portion of its business (it is hereby agreed that (i) any business that constitutes at
least twenty (20%) percent of the Company’s prior fiscal year’s revenues and (ii) the Company’s
Power Conversion and Communications Products business areas shall automatically be deemed
“significant” hereunder) in any geographic area in which the Company or any of its subsidiaries
then is so engaged. Notwithstanding the foregoing, the Executive shall be permitted to own (as a
passive investment) not more than two (2%) percent of the economic interests of a person or entity;
provided, however, that said two (2%) percent limitation shall apply to the
aggregate holdings of the Executive and those of all other persons and entities with whom the
Executive has agreed to act for the purpose of acquiring, holding, voting or disposing of such
securities, except pursuant to a bona fide operating agreement in respect of such person or entity,
such as a stockholders’ agreement or partnership agreement. In the event of a termination of the
Employment Term as a result of a change in a “Change of Control”, the non-compete covenant
contained in this paragraph shall not apply to the Executive.



     7.4 Certain Activities. For purposes of clarification, but not of limitation, the
Executive hereby acknowledges and agrees that, in addition to the provisions of Section 7.3 above,
he shall not, during the period referred to therein, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any officer, employee, agent,
lessor, lessee, licensor, licensee, customer (including those that are being actively solicited to
become customers), creditor or supplier (each, a “Solicited Person”) of the Company or any of its
subsidiaries to discontinue or adversely alter his or its relationship with the Company or any of
its subsidiaries so that such person can start or develop a relationship with any other person in
which the Executive has an interest as referred to in Section 7.3 hereof. For purposes of this
Section 7.4, a Solicited Person shall be deemed to include any person or entity who was an officer,
employee, agent, lessor, lessee, licensor, licensee, customer, prospective customer, creditor or
supplier at any time during the six-month period prior to the termination of the Employment Term.



     7.5 Injunctive Relief, etc. The parties hereto hereby acknowledge and agree that (i)
the Company would be irreparably injured in the event of a breach by the Executive of any of his
obligations under this Section 7; (ii) monetary damages would not be an adequate remedy for any
such breach; and (iii) the Company shall be entitled to injunctive relief, in addition to any other
remedies that it may have, in the event of any such breach. It is hereby also agreed that the
existence of any claims that the Executive may have against the Company or any of its subsidiaries,
whether under this Agreement or otherwise, shall not be a defense to the enforcement by the Company
of any of its rights under this Section 7.



     If the Company shall commence an injunctive action against the Executive in a court of
competent jurisdiction, the Executive may commence an action in such court, in lieu of the
arbitration of claims under Section 6 hereof, and upon the Executive’s commencement of such action,
the provisions of Section 6 hereof shall be null and void and of no further effect.



     7.6 Scope of Restrictions. It is the intent of the parties hereto that the covenants
and restrictions contained in this Section 7 shall be enforced to the fullest extent permissible
under the laws and public policies of each jurisdiction in which enforcement is sought. The
Executive



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hereby acknowledges that said restrictions are reasonably necessary for the protection of the
Company. Accordingly, it is hereby agreed that if any provision of this Section 7 shall be
adjudicated to be invalid or unenforceable for any reason whatsoever, said provision shall be (only
with respect to the operation thereof in the particular jurisdiction in which such adjudication is
made) construed by limiting and reducing it so as to be enforceable to the fullest extent
permissible, without invalidating or limiting the remaining provisions of this Agreement or
affecting the validity or enforceability of said provision in any other jurisdiction.



     7.7 Non-exclusivity. The undertakings and obligations of the Executive contained in
this Section 7 shall be in addition to, and not in lieu of, any obligations which he may have with
respect to the subject matter hereof, whether by contract, as a matter of law or otherwise.



     7.8 Availability. Reasonably subject to his employment commitments elsewhere, the
Executive hereby agrees to make himself available to the Company after the termination of the
Employment Term, at such reasonable time or times as may be required by the Company in connection
with any pending or threatened litigation or governmental investigation involving the Company, not
to exceed five (5) days in any calendar quarter unless otherwise mutually agreed. The Company shall
advance or reimburse the Executive for any out-of-pocket expenses reasonably incurred by him in
fulfilling his obligations under this Section 7.8 upon the submission by him of reasonably itemized
accounts therefor, and shall pay the Executive a mutually agreed upon per diem fee for any days in
excess of two (2) hereunder, including reasonable preparation time.



     7.9 Survival of Provisions of Section 7. It is understood and agreed that the
provisions of this Section 7 shall survive the date of termination or expiration of the Employment
Term.



     8. Miscellaneous Provisions.



     8.1 Withholding. All payments required to be made to the Executive by the Company
hereunder shall be subject to any applicable withholding under applicable Federal, state and local
income tax laws. Any such withholding shall be based upon the most recent Form W-4 filed by the
Executive with the Company, and the Executive may from time to time revise such filing.



     8.2 Severability. If in any jurisdiction any term or provision hereof is adjudicated
to be invalid or unenforceable, (i) the remaining terms and provisions hereof shall be unimpaired,
(ii) any such invalidity or unenforceability in any jurisdiction shall not invalidate, limit or
render unenforceable such provision in any other jurisdiction and (iii) the invalid or
unenforceable term or provision shall, for purposes of such jurisdiction, be deemed replaced by a
term or provision that is valid and enforceable and that comes closest to expressing the intention
of the invalid or unenforceable term or provision.



     8.3 Indemnification. The Company shall indemnify the Executive to the fullest extent
permitted by applicable law for all amounts (including without limitation, judgments, fines,
settlement payments, costs, expenses and attorneys’ fees and expenses) reasonably incurred or paid
by the Executive in connection with any claim, action, suit, investigation or proceeding



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arising out of or relating to performance by the Executive of services for, or actions of the
Executive as (or the Executive’s serving in the position of) a director, officer or employee of,
the Company, any subsidiary or affiliate of the Company or any enterprise at the Company’s request,
and shall advance to the Executive (subject to the Executive’s undertaking to repay any advances if
it is determined that he is not entitled to them) the reasonable costs, including attorneys’ fees,
of defending any such notion. The provisions of this Section 8.3 shall survive the termination of
this Agreement.



     8.4 Execution in Counterparts. This Agreement may be executed in one or more
counterparts, and by each of the parties hereto in separate counterparts, each of which shall be
deemed to be an original but all of which taken together shall constitute one and the same
agreement, and this Agreement shall become effective when one or more counterparts has been signed
by each of the parties hereto and delivered to the other party hereto.



     8.5 Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed duly given when delivered by hand, or when delivered if mailed by
registered or certified mail or private courier service, postage prepaid, to the respective
addresses as follows:



     If to the Company, to:




		
	           	Artesyn Technologies, Inc.

7900 Glades Road — Suite 500

Boca Raton, FL 33434

Attn: Vice President — Chief Financial Officer





     If to the Executive, to:




		
	           	Joseph M. O’Donnell

3681 Carlton PlaceM

Boca Raton, Florida 33496





or to such other address(es) as either party hereto shall have designated by like notice to the
other Party hereto.



     8.6 Amendment. No provision of this Agreement may be modified, amended or discharged
in any manner, except by a written instrument executed by each of the parties hereto.



     8.7 Entire Agreement. This Agreement constitutes the entire agreement of the parties
hereto with respect to the subject matter hereof, and supersedes all prior agreements and
understandings of the parties hereto, oral and written, including all prior or existing employment
agreements. Each party hereby acknowledges and agrees that, other than as contained herein, no
other representations or warranties, oral or written, have been made, expressly or impliedly, by
the other party hereto.



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     8.8 Applicable Law. This Agreement shall be governed by the laws of the State of
Florida applicable to contracts made and to be wholly performed therein.



     8.9 Headings. The headings contained herein are for the sole purpose of convenience
of reference, and shall not in any way limit or affect the meaning or interpretation of any of the
terms or provisions of this Agreement.



     8.10 Non-assignability.



     8.10.1 By the Executive. Neither this Agreement nor any right, duty, obligation or
interest hereunder shall be assignable or delegable by the Executive without the Company’s prior
written consent; however, that the Executive may designate any of his beneficiaries to receive (and
such beneficiaries shall receive) any compensation, payments or other benefits payable hereunder
upon or after his death, or the foregoing may be transferred by the laws of descent or
distribution.



     8.10.2 By the Company. This Agreement and all of the Company’s rights and obligations
hereunder may be assigned or transferred by it through a merger, consolidation or other business
combination, including a Change of Control. Upon the occurrence of such a transaction any such
successor company resulting therefrom shall be deemed to be substituted for all purposes as the
Company hereunder.



     8.11 Binding Effect; Benefits. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective heirs, legal representatives, successors and
permitted assigns.



     8.12 Waiver. The failure of either of the parties hereto at any time to enforce any
provision of this Agreement shall not be deemed or construed to be a waiver of any such or any
other provision, nor to in any way affect the validity of this Agreement or any provision hereof or
the right of either of the parties hereto to thereafter enforce each and every provision of this
Agreement. No waiver of any breach of any of the provisions of this Agreement shall be effective
unless set forth in a written instrument executed by the party against whom or which enforcement of
such waiver is sought, and no waiver of any such breach shall be construed or deemed to be a waiver
of any other or subsequent breach.



     8.13 Capacity, etc. The Executive hereby represents and warrants to the Company and
the Company hereby represents and warrants to the Executive that: (i) he (or it) has full power,
authority and capacity to execute and deliver this Agreement, and to perform his (or its)
obligations hereunder, (ii) said execution, delivery and performance will not (and with the giving
of notice or lapse of time, or both, would not) result in the breach of any agreement or other
obligation to which he (or it) is a party or is otherwise bound and (iii) this Agreement is his (or
its) valid and binding obligation enforceable in accordance with its terms.



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     IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto as of
the date first above written.


	 	 	 	 	 
	 	ARTESYN TECHNOLOGIES, INC.

 	 
	 	By:  	/s/ Richard J. Thompson
 	 
	 	 	Vice President-Finance, Chief Financial Officer, and Secretary 	 
	 	 	 	 
	 



	 	 	 	 	 
	 	 	 
	 	                                         /s/ Joseph M. O’Donnell
 	 
	 	Joseph M. O’Donnell 	 
	 	 	 
	 





AGREED AND ACCEPTED:



/s/ Phillip A. O’Reilly






Phillip A. O’Reilly

Chairman – Compensation Committee




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