**Exhibit10.2**

 

 

September 20,2004

 

Patrick Reutens

 

Dear Patrick:

 

Silicon Image, Inc. (the “Company”)is pleased to confirm our offer to you with us, in the position of **Chief Legal Officer**. ** **The terms of our offer and thebenefits currently provided by the Company are as follows:

 

1.     Yourinitial annual base salary will be **$250,000**,payable in accordance with the Company’s normal payroll practices with suchpayroll deductions and withholdings as are required by law and subject toadjustment by the Board of Directors of the Company or a committee of the Boardof Directors of the Company (the “Board”).  In addition, you will be eligible toparticipate in regular health insurance, vacation and other employee benefitplans established by the Company for its employees from time to time. You willhave overall responsibility for the legal management of the Company and willreport directly to the Chief Executive Officer. You will be expected to devote your full working time and attention tothe business of the Company, and you will not directly or indirectly, engage orparticipate in any business that is competitive in any manner with the businessof the Company.  You will also beexpected to comply with and be bound by the Company’s operating policies,procedures and practices that are from time to time in effect during the termof your employment.

 

2.     Ahiring bonus of **$30,000** is to bepaid to you in two installment payments of $15,000. The first payment will bemade to you upon your commencement of employment with the Company. The secondpayment will be made to you upon the six-month anniversary (“Six MonthAnniversary”) of your employment with the Company, as long as you continueto be employed by the Company on the Six Month Anniversary. .

 

3*.**    *As an employee of theCompany you will have access to certain Company confidential information andyou may, during the course of your employment, develop certain information orinventions which will be the property of the Company.  To protect the interest of the Company, youwill need to sign the Company’s standard “Employee Inventions andConfidentiality Agreement” as a condition of your employment.  *We wish to impress uponyou that we do not wish you to bring any confidential or proprietary materialof any former employer or to violate any other obligations you may have to yourformer employer.*

 

4.     TheBoard will approve a grant to you, contingent on you consummating employmentwith the Company as Chief Legal Officer, of stock options to purchase **375,000 shares**of the Company’s Common Stock at an exerciseprice equal to the closing price on the date that you begin employment with theCompany.  Provided you continue to provide services to the Company, the stockoptions will become vested and exercisable with respect to 25% of the totalshares granted on the 12 month anniversary date of your employment commencementdate, and thereafter on the same date of each succeeding month an additional2.083% of the total shares granted under the stock option will become vestedand exercisable.

 

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5.     Upontermination of your employment with the Company for any reason, you willreceive payment for all unpaid salary and vacation accrued to the date of yourtermination of employment; and (except as provided in Section 5(b)(iv)below) your benefits will terminate pursuant to the terms of the Company’s thenexisting benefit plans and policies as provided under the terms of such plansand policies and as required by applicable law. Under certain circumstances, you will also be entitled to receiveSeverance Payments (as defined below), but you will not be entitled to anyother compensation, award or damages with respect to your employment ortermination.  A general release of claimsagreement, as provided to you by the Company, must be executed by you anddelivered to the Company in order for you to receive any Severance Payments.

 

a)         Inthe event of your voluntary termination or termination for Cause, you will notbe entitled to any severance benefits including, but not limited to SeverancePayments, or additional vesting of shares of restricted stock or options.

 

b)        Inthe event of your involuntary termination without Cause, you shall be entitledto (i) continue to receive your salary for six (6) months followingtermination, at the same rate of your base salary at the time of termination;(ii) six (6) months acceleration on the vesting of any options to purchaseshares of the Company’s common stock that you hold at the time of termination;(iii) any target bonus that you are eligible for at the time of termination,prorated for the portion of the fiscal year that you were employed and (iv)payment by the Company of your COBRA insurance premiums, should you electcoverage, for a period of the shorter of six (6) months following terminationor until you become employed at a new position (Items (i), (ii) (iii) and (iv)being collectively defined as “Severance Payments”); *provided however,*that in no event shallyou receive Severance Payments if you fail to execute and deliver to theCompany, a general release of claims, as provided to you by the Company.  Severance Payments, if any, shall be madeless applicable deductions and withholdings and in accordance with the Company’snormal payroll practices.

 

c)         “Cause” means (i) any material breach of this agreement,the Employee Inventions and Confidentiality Agreement between you and theCompany, or any other written agreement between you and the Company, if suchbreach causes harm to the Company; (ii) any gross negligence or willfulmisconduct by you in your performance of duties to the Company that causes harmto the Company, including (without limitation) repeated failure to follow thedirections of the person to whom you report; (iii) your repeated failure todiligently follow the lawful directions of the Board or your repeated failureto diligently perform your duties in a reasonable manner pursuant to thisagreement; (iv) your commission of a felony under the laws of the United Statesor any state thereof; (v) your commission of any act of fraud, embezzlement ordishonesty or breach of fiduciary duties; or (vi) your the abuse of alcohol orcontrolled substances that has a detrimental effect upon your performance ofyour duties under this agreement.  Atermination without Cause shall mean a termination for any reason other thanthose listed in clauses (i)-(vi) of the preceding sentence or death ordisability.

 

6.     Thisletter agreement constitutes the entire understanding and agreement of theparties hereto with respect to the subject matter hereof and supersedes allprior and contemporaneous agreements or

 

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understandings,inducements or conditions, express or implied, written or oral, between theparties with respect to such subject matter.

 

7.     Thisagreement will be governed by the laws of the State of California withoutreference to conflict of laws provisions.

 

8.     Youagree that any dispute regarding the interpretation or enforcement of thisagreement shall be decided by confidential, final and binding arbitrationconducted by Judicial Arbitration and Mediation Services (“JAMS”) underthe then existing JAMS rules rather than by litigation in court, trial by jury,administrative proceeding or in any other forum.

 

9.     Whilewe look forward to a long and profitable relationship, should you decide toaccept our offer, you will be an at-will employee of the Company, which meansthe employment relationship can be terminated by either of us for any reason atany time.  Any statements orrepresentations that have been or may be, made to you that are contrary, shouldbe regarded by you as ineffective. Further, your participation in any stock option or benefit program isnot to be regarded as assuring you of continuing employment for any particularperiod of time.

 

10.   Pleasenote that because of employer regulations adopted in the Immigration Reform andControl Act of 1986, within three business days of starting your new positionyou will need to present documentation demonstrating that you haveauthorization to work in the United States. If you have questions about this requirement, which applies to U. S.citizens and non-U.S. citizens alike, you may contact our Human Resourcedepartment.

 

11.   Pleasesign the enclosed copy of this letter in the space indicated and return it tothe Human Resource department.  Your signaturewill acknowledge that you have read and understood and agreed to the terms andconditions of this offer and the attached documents.  Should you have anything else that you wishto discuss, please do not hesitate to call.

 

We look forward to the opportunityto welcome you to Silicon Image, Inc.

 

Sincerely,

 

 
| /s/  David Lee                                     |   | 9/20/04 |   |   |
|----------------------------------------------------|--------|---------|--------|--------|
| David Lee                                          |
| Chief Executive Officer  and Chairman of the Board |
|                                               |
|                                               |
| Acknowledged, Accepted  and Agreed                 |

 

 
| /s/  Patrick Reutens |   | 9/20/04 |   | 10/22/04   |
|----------------------|--------|---------|--------|------------|
| Patrick Reutens      |   | Date    |   | Start Date |

 

Thisletter is simply for your information and is not to be construed as a contractof employment.

 

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