EXECUTIVE IS EMPLOYED AS PRESIDENT, THE CHIEF
EXECUTIVE OFFICER) OF HIS ANTICIPATED VACATION DATES WITHIN A REASONABLE PERIOD,
AND SUCH VACATION DATES SHALL BE SUBJECT TO APPROVAL BY THE BOARD OF DIRECTORS
(OR CHIEF EXECUTIVE OFFICER DURING THE TIME EXECUTIVE IS EMPLOYED BY AS
PRESIDENT).
3.9
CELLULAR TELEPHONE.
THE COMPANY AGREES TO
PROVIDE EXECUTIVE WITH A CELLULAR TELEPHONE OF THE COMPANY'S SELECTION, AND TO
PAY NORMAL AND CUSTOMARY EXPENSES FOR THE BUSINESS USE OF THE TELEPHONE DURING
THE EMPLOYMENT PERIOD.
3.10
LIFE INSURANCE ENHANCEMENT.
THE COMPANY WILL
PROVIDE EXECUTIVE WITH AN ENHANCEMENT OF THE GROUP TERM LIFE INSURANCE AND
SUPPLEMENTAL GROUP TERM LIFE INSURANCE PLANS GENERALLY MADE AVAILABLE TO COMPANY
EMPLOYEES AS FOLLOWS:
THE COMPANY AGREES TO PAY THE PREMIUMS FOR AN INDIVIDUAL
TERM LIFE INSURANCE POLICY FOR EXECUTIVE, WITH A DEATH BENEFIT OF ONE MILLION
DOLLARS ($1,000,000), DURING THE EMPLOYMENT PERIOD.
EXECUTIVE UNDERSTANDS AND
AGREES THAT, AT THE END OF THE EMPLOYMENT PERIOD, THE COMPANY'S OBLIGATION TO
PAY PREMIUMS FOR THIS TERM LIFE POLICY SHALL CEASE; THAT HE MAY ELECT, SUBJECT
TO THE TERMS OF THE POLICY, TO ASSUME RESPONSIBILITY FOR SUCH PREMIUMS IN THE
EVENT HE DESIRES TO CONTINUE THAT TERM LIFE COVERAGE; AND
3
THAT, IF HE DOES NOT ASSUME PAYMENT OF SAID PREMIUMS, HIS TERM LIFE INSURANCE
WILL CEASE AS OF THE COMPLETION DATE.
3.11
EXPENSE REIMBURSEMENT.
DURING THE EMPLOYMENT
PERIOD, THE COMPANY SHALL REIMBURSE EXECUTIVE, IN ACCORDANCE WITH THE COMPANY'S
POLICIES AND PROCEDURES, FOR ALL PROPER EXPENSES INCURRED BY HIM IN THE
PERFORMANCE OF HIS DUTIES HEREUNDER.
3.12
LIVING EXPENSES. THE COMPANY AGREES TO PAY
EXECUTIVE'S REASONABLE, DULY DOCUMENTED TRAVEL, MEAL AND LODGING EXPENSES FOR
TRAVEL TO AND FROM MORGAN HILL, AND FOR LODGING AND MEALS IN MORGAN HILL, DURING
THE PERIOD COMMENCING ON THE START DATE AND ENDING ON THE DATE EXECUTIVE HE
RELOCATES TO MORGAN HILL (BUT NOT LATER THAN DECEMBER 31, 2003).
SUCH EXPENSE
REIMBURSEMENTS WILL BE GROSSED UP TO COVER ANY RELATED TAXES IF SUCH PAYMENTS
ARE DEEMED TAXABLE INCOME TO EXECUTIVE.
3.13
RELOCATION.
EXECUTIVE SHALL RELOCATE TO THE
MORGAN HILL/BAY AREA NOT LATER THAN DECEMBER 31, 2003.
THE COMPANY WILL
REIMBURSE EXECUTIVE FOR THE STANDARD AND REASONABLE COSTS OF RELOCATING
EXECUTIVE AND HIS FAMILY TO THE MORGAN HILL/BAY AREA.
THIS WILL INCLUDE THE
TRANSPORTATION OF HOUSEHOLD GOODS, STANDARD FEES AND COMMISSIONS RELATED TO THE
SALE OF EXECUTIVE'S CURRENT HOME (UP TO 6%) AND THE REASONABLE CLOSING COSTS
ASSOCIATED WITH THE PURCHASE OF A NEW HOME.
THE RELOCATION EXPENSE
REIMBURSEMENTS WILL BE GROSSED UP TO COVER ANY RELATED TAXES.
4.
TERMINATION.
4.1
DEATH OR DISABILITY.
EXECUTIVE'S EMPLOYMENT
SHALL TERMINATE AUTOMATICALLY UPON EXECUTIVE'S DEATH.
IF THE COMPANY DETERMINES
IN GOOD FAITH THAT THE DISABILITY OF EXECUTIVE HAS OCCURRED (PURSUANT TO THE
DEFINITION OF DISABILITY SET FORTH BELOW), IT MAY GIVE TO EXECUTIVE WRITTEN
NOTICE OF ITS INTENTION TO TERMINATE EXECUTIVE'S EMPLOYMENT.
IN SUCH EVENT,
EXECUTIVE'S EMPLOYMENT WITH THE COMPANY SHALL TERMINATE EFFECTIVE ON THE 30TH
DAY AFTER RECEIPT OF SUCH NOTICE BY EXECUTIVE, PROVIDED THAT, WITHIN THE 30 DAYS
AFTER SUCH