Document:

exv10w36

 

Exhibit 10.36

1060 East. Arques Ave.

Sunnyvale CA 94085

Ph: (408) 616-4000

Fax: (408) 830-9525

January 24, 2005

Steve Tirado

Dear Steve:

     On behalf of the Board of Directors (the “Board”) of Silicon Image, Inc. (the “Company”), it
is my pleasure to offer you the position of Chief Executive Officer and President of the Company.
The terms of our offer and the benefits provided by the Company are as follows:

     1. You will report to the Board, which will nominate and elect you to the Board as a Class I
director. While you are employed at the Company, you will abide by your duty of loyalty to the
Company, will perform your duties and follow the lawful directions of the Board in a diligent
manner, and will devote your full time, energy and attention to the interests of the Company,
subject to your devotion of time to manage your personal assets and investments, and to participate
in charitable, professional and community activities, provided such devotion of time does not
materially interfere with your service to the Company. You will receive an indemnification
agreement for your service as an officer and director of the Company consistent with
indemnification agreements in place with other members of the Board.

     2. Your annual base salary will be $475,000 per year. For the 2005 fiscal year, you will be
eligible to receive a cash bonus under an executive bonus program for the year to be proposed by
you and approved by the Compensation Committee of the Board. Such executive bonus program will
provide for a potential cash bonus to you of 70% of your annual base salary for the 2005 fiscal
year, provided that the actual bonus amount (which may be less than 70% of your annual base salary
for the 2005 fiscal year) will be determined by Company performance (as determined by the Company’s
2005 Annual Operating Plan) and whatever other factors the executive bonus program considers. Your
cash compensation will be subject to annual review by the Compensation Committee.

     3. You will be granted an option for 380,000 shares of common stock upon execution of this
letter agreement. In addition, on the first business day of 2006 you will be granted an option for
500,000 shares of common stock. The options will have an exercise price equal to the closing price
of our common stock on the Nasdaq Stock Market on their respective grant dates, and each option
will vest and become exercisable with respect to one-forty-eighth of the shares in such option each
month after the grant date of such option so long as you remain continuously

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employed by the Company as an employee, subject to the vesting acceleration provisions set
forth in Section 5 of this letter agreement.

     4. You will be eligible to participate in the other employee benefit plans and executive
compensation programs maintained by the Company applicable to other employees and key executives of
the Company, including without limitation stock option, stock purchase, incentive or other bonus
plans, life, disability, health, accident and other insurance programs, and similar plans or
programs. You will receive not less than three weeks of paid vacation each year.

     5. Upon any termination of your employment with the Company, you shall in all cases receive
(i) payment for all unpaid salary and vacation accrued through the date of your termination of
employment; (ii) reimbursement for expenses per existing Company policies; and (iii) continued
benefits in accordance with the terms of the Company’s then existing benefit plans and policies
and/or as required by applicable law; such payments and benefits are not included within the
separation benefits described below (but likewise will not operate to duplicate such separation
benefits either). In addition to the above benefits, you shall under certain circumstances, also
be entitled to receive separation benefits as set forth below; provided, that in order to receive
any separation benefits you must first execute a full unilateral release (including a waiver of
unknown claims and covenant not to sue) in favor of the Company and its directors, officers and
other related persons and an agreement not to solicit employees of the Company for a period of one
year following termination, each in the form then used by the Company for departing executives; and
further provided, however, that you will not be required to release any right to indemnification
that you may have under applicable law, the Company’s Certificate of Incorporation, the Company’s
bylaws or any indemnity agreement between you and the Company nor any rights related to your then
existing equity ownership in the Company. You will not be entitled to any other compensation,
award or damages with respect to your employment or termination.

      A. In the event of your voluntary termination (other than for Good Reason) or termination for
Cause (as defined below), you will not be entitled to any cash separation benefits or additional
vesting of shares of restricted stock or options.

	 	i.  	“Cause” means (i) conviction of, or plea of guilty
or no contest to, a felony under the laws of the United States or any
state thereof or any act of fraud, embezzlement or dishonesty, (ii)
breach of fiduciary duties not remedied within thirty days of written
notice, or (iii) material breach of this letter agreement or any other
written agreement with the Company not remedied within thirty days of
written notice.
	 
	 	ii.  	“Good Reason” means (i) any material reduction in
your job duties and responsibilities not approved in writing by you and
not restored within thirty days of written notice to the Board, (ii) your
failure to be elected at any time as a member of the Board, or (iii) any
demoting change in your job title as Chief Executive Officer and
President, reduction in annual base salary or potential cash bonus, or
requirement that your principal place of business be located more than 25
miles from the current location of the Company’s principal place of
business at 1060 East Arques Avenue, Sunnyvale, California not rescinded
within thirty days of written notice to the Board.

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           B. In the event the Company terminates your employment without Cause, or in the event of
termination by you for Good Reason or your termination due to death or disability, you shall be
entitled to (i) cash severance equal to your then current annual base salary, paid pro rata over
the next twelve months in accordance with normal payroll dates, (ii) reimbursement of COBRA
insurance premiums (if you elect COBRA coverage), for twelve months following your termination,
(iii) the calculated amount (if any) payable to the Chief Executive Officer under the executive
bonus program of the Company pro rata for the year in which such termination occurs, less
applicable deductions and withholdings and in accordance with the Company’s normal payroll
practices. Your right to receive COBRA insurance premiums shall terminate upon your commencement
of full-time employment with another company (which you shall promptly notify the Company of); and
(iv) twelve months of accelerated vesting under your Company stock options and restricted stock
awards (whether referred to above or otherwise granted in the future).

           C. No acceleration of vesting will be deemed to extend beyond the number of then-unvested
options or shares under a particular award at the time of acceleration. No additional vesting
shall occur following termination of service. Vested options will be exercisable for (i) three
months following the termination date in the case of your termination without Cause, termination by
you for Good Reason, your voluntary termination or termination for Cause, but in no event later
than the expiration date of the options, or (ii) twelve months following the termination date in
the case of termination due to death or disability.

     6. While we look forward to a long and profitable relationship, should you decide to accept
our offer, you will be an at-will employee of the Company, which means the employment relationship
can be terminated by either of us for any reason at any time. Any statements or representations to
the contrary (and any statements contradicting any provision in this letter) should be regarded by
you as ineffective. Further, your participation in any stock option or benefit program is not to
be regarded as assuring you of continuing employment for any particular period of time.

     7. This letter agreement constitutes the entire understanding and agreement of the parties
hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous
agreements or understandings, inducements or conditions, express or implied, written or oral,
between the parties with respect to such subject matter, including without limitation the April 1,
2004 letter agreement between you and the Company which the parties hereto agree is hereby
terminated and superceded by this letter agreement.

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     8. This offer will remain open until 11:59 p.m. on January 24, 2005. If you decide to accept
our offer, and I hope you will, please sign the enclosed copy of this letter agreement in the space
indicated below and return it to me. Your signature will acknowledge that you have read and
understood and agreed to the terms and conditions of this offer. Should you have anything else
that you wish to discuss, please do not hesitate to call me.

     We look forward to the opportunity to welcome you to the Company.

	 	 	 	 	 	 	 	 	 	 	 
	Silicon Image, Inc.

	 	 	 	Accepted	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By   /s/ Chris Paisley

	 	 	 	   /s/ Steve Tirado	 	 	 	 	 	 
	
	 	

	Chris Paisley
      	 	 	 	Steve
Tirado   	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:       Chairman of the Board
	 	 	 	Date    1/24/05	 	 	 	 	 	 
	
	 	

4exv10w37

 

Exhibit 10.37

1060 East. Arques Ave.

Sunnyvale CA 94085

Ph: (408) 616-4000

Fax: (408) 830-9525

February 8, 2005

Jimmy Garcia-Meza

Dear Jimmy:

          Silicon Image, Inc. (the “Company”) is pleased to confirm our offer of continued employment to
you. The terms of our offer and the benefits provided by the Company are as follows:

	 	1.  	You will report to the Chief Executive Officer in the position of Vice President,
Storage. By your signature below, you hereby concurrently resign from your other sales
positions at the Company.
	 
	 	2.  	Your annual base salary will be $275,000 per year, effective as of February 8, 2005.
You will be eligible to participate in 2005 Bonus Plan to be determined by the Compensation
Committee of the Board of Directors at a level appropriate to your position. We will also
recommend that the Compensation Committee grant you a stock option for 100,000 shares with
an exercise price equal to the closing price of our stock on the date of grant. Vesting
for this grant will occur at the end of each month based on the schedule below, provided
you continue to be employed by us.

	 	-  	1.2500% per month for each of the twelve (12) months beginning January
1, 2007 and ending December 31, 2007;
	 
	 	-  	5.0000% per month for each of the twelve (12) months beginning January
1, 2008 and ending December 31, 2008;
	 
	 	-  	2.0833% per month for each of the twelve (12) months beginning January
1, 2009 and ending December 31, 2009;

	 	3.  	You will be eligible to participate in the employee benefit plans and executive
compensation programs maintained by the Company applicable to other employees and key
executives of the Company, including, without limitation, retirement plans, savings or
profit-sharing plans, deferred compensation plans, supplemental retirement or
excess-benefit plans, stock option, stock purchase, incentive or other bonus plans, life,
disability, health, accident and other insurance programs, and similar plans or

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programs. You will be eligible for the applicable number of days of paid PTO per year,
per the PTO policy.

	 	4.  	Employment and Termination. Your employment with Silicon Image will be at-will and may
be terminated by you or by Silicon Image at any time for any reason as follows:

(a) You may terminate your employment upon written notice to the Board of Directors at
any time in your discretion (“Voluntary Termination”);

(b) Silicon Image may terminate your employment upon written notice for “Cause,” as
defined below, for such termination (“Termination for Cause”);

(c) Silicon Image may terminate your employment upon written notice to you at any time
without a determination that there is Cause for such termination (“Termination without
Cause”);

(d) Your employment will automatically terminate upon your death or upon your disability
as determined by the Board of Directors (“Termination for Death or Disability”);
provided that “disability” shall mean your complete inability to perform your job
responsibilities for a period of 180 consecutive days or 180 days in the aggregate in
any 12-month period;

(e) Your employment may be a “Termination in Connection with a Change in Control” if
there is a Change in Control and either (i) you are employed by Silicon Image on the
date of the Change in Control and continue your employment after the Change in Control
to aid in an orderly transition, if Silicon Image so requests (provided that you shall
not be required to continue your employment for more than three (3) months after the
Change in Control in order to satisfy such obligation), or (ii) Silicon Image terminates
your employment other than for Cause, death or Disability after Silicon Image begins
negotiations with a third party that culminates in a Change of Control and not more than
150 days prior to the Change in Control (in which case, for the purpose of interpreting
the vesting and exercisability provisions of your stock option grants, your termination
shall be deemed to occur on the date of the Change in Control).

Definitions used in this agreement:

“Cause” means willful gross misconduct, conviction of a felony or an act of material
personal dishonesty.

“Change in Control” means the closing of any transaction or series of related
transactions, including the acquisition of Silicon Image by another entity and any
reorganization, merger or consolidation, which results in the holders of Silicon Image’s
capital stock prior to the transaction or transactions holding less than fifty percent
(50%) of the outstanding voting power of Silicon Image after the transaction or
transactions, or which results in the sale of all or substantially all of the assets of
Silicon Image.

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Separation Benefits. Upon termination of your employment with Silicon Image for any
reason, you will receive payment for all unpaid salary and vacation accrued to the date
of your termination of employment; and your benefits will be continued under Silicon
Image’s then existing benefit plans and policies for so long as provided under the terms
of such plans and policies and as required by applicable law. Under certain
circumstances, you will also be entitled to receive severance benefits as set forth
below, but you will not be entitled to any other compensation, award or damages with
respect to your employment or termination.

(a) In the event of your Voluntary Termination or Termination for Cause, you will not be
entitled to any cash severance benefits or additional vesting of shares of restricted
stock or options.

(b) In the event of your Termination without Cause, you shall be entitled to severance
for six (6) months following your termination, at the rate of your Base Salary plus
target bonus for that year and in accordance with Silicon Image’s normal payroll
practices.

(c) In the event of your Termination in Connection with a Change in Control, your stock
option grant number 000808 dated April 5, 2001 (“Initial Stock Grant”) shall have a
vesting rate of twice the vesting rate set forth in the grant, provided, that in no
event shall the minimum aggregate number of shares vested be less than at least
one-quarter (1/4) of the aggregate number of shares granted; and you shall be entitled
to severance for six (6) months following your termination, at the rate of your Base
Salary plus target bonus for that year and in accordance with Silicon Image’s normal
payroll practices.. For example, if immediately prior to a Change of Control, your
Initial Stock Grant would have otherwise vested as to forty percent (40%) of the shares,
then upon such Change in Control such Initial Stock Grant shall instead be vested as to
eighty percent (80%) of the shares. For example, if immediately prior to a Change of
Control, your Initial Stock Grant would have otherwise vested as to none of the shares
subject to the grants, then upon such Change in Control, such Initial Stock Grant shall
instead be vested as to twenty-five percent (25%) of the shares. In addition, should
your employment continue following a Change in Control, all your stock options granted
prior to the Change in Control shall continue to vest at the vesting rate set forth in
the original grant.

(d) If your severance and other benefits provided for in this Section 8 constitute
“parachute payments” within the meaning of Section 280G of the Code and, but for this
subsection, would be subject to the excise tax imposed by Section 4999 of the Internal
Revenue Code, then your severance and other benefits under this Section 8 will be
payable, at your election, either in full or in such lesser amount as would result,
after taking into account the applicable federal, state and local income taxes and the
excise tax imposed by Section 4999, in your receipt on an after-tax basis of the
greatest amount of severance and other benefits.

(e) No payments due you hereunder shall be subject to mitigation or offset.In
consideration of and as a condition to receiving the severance set forth in this Section
4, concurrently with your termination of employment, you will execute an agreement in
form acceptable to the Company providing for a full unilateral release in favor of

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the Company and its directors, officers and other related persons. However, you will not be
required to release any right to indemnification that you may have under applicable law,
the Company’s bylaws or the Indemnity Agreement between you and the Company.

	 	5.  	During the term of your employment with the Company and for one year thereafter, you
will not, on behalf of yourself or any third party, solicit or attempt to induce any
employee of the Company to terminate his or her employment with the Company.
	 
	 	6.  	Should you decide to accept our offer, you will remain an at-will employee of the
Company, which means the employment relationship can be terminated by either of us for any
reason at any time. Any statements or representations to the contrary (and, indeed, any
statements contradicting any provision in this letter) should be regarded by you as
ineffective. Further, your participation in any stock option or benefit program is not to
be regarded as assuring you of continuing employment for any particular period of time.
	 
	 	7.  	This letter agreement constitutes the entire understanding and agreement of the parties
hereto with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements or understandings, inducements or conditions, express or
implied, written or oral, between the parties with respect to such subject matter,
including without limitation the letter agreement between you and the Company dated July
16, 1999. This agreement will be governed by the laws of the State of California without
reference to conflict of laws provisions. The parties agree that any dispute regarding the
interpretation or enforcement of this agreement shall be decided by confidential, final and
binding arbitration conducted by Judicial Arbitration and Mediation Services (“JAMS”) under
the then existing JAMS rules rather than by litigation in court, trial by jury,
administrative proceeding or in any other forum.
	 
	 	8.  	If you decide to accept our offer, and I hope you will, please sign the enclosed copy
of this letter agreement in the space indicated below and return it to me. Your signature
will acknowledge that you have read and understood and agreed to the terms and conditions
of this offer. Should you have anything else that you wish to discuss, please do not
hesitate to call me.

We look forward to the opportunity to continue working together.

Very truly yours,

Silicon Image, Inc.

	 	 	 	 	 
	By:

	 	/s/ Steve Tirado
	 	 
	
	 	 
	

	 	Steve Tirado, CEO	 	 

2/15/05

Acknowledged, Accepted and Agreed

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     /s/ Jimmy Garcia-Meza

Jimmy Garcia-Meza

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