Document:

exv10wxjy

 

EXHIBIT 10(j)

[THIS AGREEMENT IS SUBJECT TO ARBITRATION]

EMPLOYMENT AGREEMENT FOR CHIEF TECHNOLOGY OFFICER

     THIS AGREEMENT is made and entered into as of the 22 day of May, 1996, by and between
Interphase Corporation (the “Corporation”), and Felix Diaz (“Executive”).

     WHEREAS, the Corporation desires to enter into an employment relationship with Executive on
certain terms and conditions as set forth herein; and

     WHEREAS, Executive is willing to accept such employment;

     NOW, THEREFORE, the parties hereto, in consideration of the mutual covenants and promises
hereinafter contained, do hereby agree as follows:

     1. Employment. The Corporation hereby
employs Executive and Executive hereby accepts the employment, on the terms and conditions
hereinafter set forth. Executive’s general duties and
responsibilities as chief Technology
Officer. Executive agrees to review and comply with all policies and procedures in the
Corporation’s Employee Handbook.

     2. Term. Executive’s employment with the Corporation will be at-will, and thus,
either party may terminate the relationship at any time for any reason, subject to the termination
provisions in paragraphs 6 and 7. Executive understands and agrees that no employee or agent of
the Corporation, other than the Corporation’s Chief Executive Officer, has any authority to enter
into any agreement for employment for any specified period of time or to make any agreement
contrary to the at-will

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER— Page 1 

 

 

relationship and that any such modifications or agreements must be in writing and signed by
the Chief Executive Officer of the Corporation.

     3. Salary
and Other Compensation. As compensation for the services to be rendered by
Executive to the Corporation pursuant to this Agreement, Executive shall be paid the following
compensation and other benefits:

     a.
Salary: $10,000.00 per month, less deductions as may be required by law,
payable in semi-monthly installments. The Corporation reserves the right to: (i) make
periodic increases or decreases in Executive’s salary, in the sole discretion of the
Corporation; (ii) make deductions from Executive’s pay to satisfy any outstanding
obligations; and/or (iii) make deductions from Executive’s pay to satisfy any losses
resulting from unlawful activities.

     b. Signing Bonus: Executive shall be paid a ten thousand dollar ($10,000.00) signing
bonus as consideration for his agreement to abide by the covenant not to compete provisions
and nondisclosure requirements contained in paragraphs 4 and 5 of this Agreement.

     c. Stock Options: The Corporation shall, in accordance with the Corporation’s Amended
and Restated Stock Option Plan, grant to Executive a qualified stock option to purchase
10,000 shares of common stock of the Corporation as consideration for his agreement to abide
by the covenant not to compete provisions and nondisclosure requirements contained in
paragraphs 4 and 5 of this Agreement.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER—Page 2

 

 

     d. Bonus: Executive shall be eligible for an annual bonus of up to thirty
thousand dollars ($30,000.00) based upon the guidelines contained in the Corporation’s
Executive Bonus Plan; less deductions as may be required by law. The Corporation reserves
the right to: (i) make periodic increases or decreases in Executive’s bonus, in the sole
discretion of the Corporation; (ii) make deductions from Executive’s bonus to satisfy any
outstanding obligations and/or (iii) make deductions from Executive’s bonus to satisfy any
losses resulting from unlawful activities.

     e.
Office Furnishings: The Corporation agrees to provide office space and
furnishings to Executive commensurate with the Corporation’s decor and culture.

     f. Executive Benefit Plans: Executive shall be allowed to participate, to the
extent he may be eligible, in any profit sharing, stock options,
retirement, insurance or
other Executive benefit plan maintained by the Corporation. Executive must comply with all
requirements regarding purchasing the Corporation’s Common Stock and exercising stock
options, including, without limitation, requirements promulgated by the Corporation and the
Security and Exchange Commission. In this regard, Executive must
report to the Corporation
any activity such as selling, purchasing or exercising the Corporation’s Common Stock
and/or stock options. Any questions regarding reporting requirements should be directed to
the Corporation’s Chief Financial Officer.

     EMPLOYMENT AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 3

 

 

     g. Vacations and Leave: Executive shall be entitled to three (3) weeks of
vacation per year and six (6) sick days per year, and any other paid leave benefits
provided for in the Corporation’s Employee Handbook.

     4. Non-Disclosure
of Confidential Information. Executive acknowledges that in
and as a result of his employment by the Corporation, he will be making use of, acquiring, and/or
adding to confidential information of a special and unique nature and value relating to such
matters as the Corporation’s patents, copyrights, proprietary information, trade secrets, systems,
product developments, procedures, manuals, confidential reports, lists of customers (which are
deemed for all purposes confidential and proprietary), as well as the nature and type of services
rendered by the Corporation, the equipment and methods used and preferred by the Corporation’s
customers, and the fees paid by them. Executive further agrees that if a third party (e.g.,
vendors, customers and manufacturers) contracts with the Corporation the information obtained or
received from a third party including, but not limited to its patents, copyrights, proprietary
information, trade secrets, systems, product development, procedures, manuals, and confidential
reports will be treated in the same manner and subject to the same protection as other Confidential
Trade Secret Information (as hereinafter defined) of the Corporation.

As a material inducement to the Corporation to enter into this Agreement and to pay
Executive the compensation and benefits stated herein and as a condition of employment and
continued employment, Executive shall keep confidential all such

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER— Page 4

 

 

confidential and proprietary information which Executive learns or acquires as a result of
his employment with the Corporation. By way of example, “Confidential Trade Secret Information” may
consist of any idea, process, design, concept, formula, pattern, device, development, customer
information or compilation of information which is used in the Corporation’s business, which gives
the Corporation an advantage over a competitor who does not know or
use it.

     Executive
agrees that the appropriate remedy for any breach of this paragraph 4 is a suit for
injunctive relief and specific performance in any court of competent jurisdiction. Executive agrees
that damages for use of any identified Confidential Trade Secret Information in violation of this
paragraph 4 shall be 100% of the gross amount of revenue derived from unauthorized use of such
information.

     5. Covenants
Not to Compete. Executive acknowledges that the service he/she is to
render to the Corporation are of a special and unusual character with
a unique value to the
Corporation, the loss of which cannot adequately be compensated by damages in action at law.
Accordingly, Executive agrees that during the term of his/her employment and for a period of one (1)
year from the date this Agreement is terminated, for whatever reason:

     a. Executive shall not, directly or indirectly, without the express written
consent of the Corporation, solicit or induce, or attempt to solicit or induce, any
employee of the Corporation, current or future, to leave or cease their relationship
with the Corporation, for any reason
whatsoever, or hire any current or future employee of the Corporation.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 5

 

 

     b. Executive shall not, directly or indirectly, without the express written content
of the Corporation: (i) engage in any business or activity that is competitive with the
business of the Corporation; and/or (ii) be employed by, or provide competitive services or
assistance to, a “Competing Business” (hereinafter defined) which would potentially
involve, directly or indirectly, the use and/or disclosure of the Corporation’s
Confidential Trade Secret Information, as defined in paragraph 4. For purposes of this
Agreement, a Competing Business means any person or firm that offers services or products
that are directly competitive with those marketed, offered for sale and/or under any stage
of development by the Corporation as of the date of Executive’s separation from employment.
If Executive desires to work for a Competing Business in an area that is not competitive
with the business of the Corporation, Executive must give written notice to the Chief
Executive Officer and obtain his approval that the employment will not violate the terms
and conditions of this paragraph 5 before beginning employment with the Competing Business.

     c. Executive will not solicit or attempt to solicit the Corporation’s existing or
prospective customers to purchase services or products that are competitive with those
marketed, offered for sale and/or under any stage of development by the Corporation as of
the date of Executive’s separation from the Corporation. For purposes of the

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 6

 

 

Agreement, existing customers shall mean those persons or firms that the Corporation has
made a sale to in the twelve (12) months preceding Executive’s separation from employment;
prospective customers shall mean those persons or firms that the Corporation has solicited
and/or negotiated to sell the Corporation’s products or services to within the twelve (12)
months preceding Executive’s separation from the Corporation.

     d. In the event that, notwithstanding the foregoing, any of the provisions of this
paragraph 5 shall be held to be invalid or unenforceable, the remaining provisions thereof
shall nevertheless continue to be valid and enforceable as though the invalid or
unenforceable parts had not been included therein. In the event that any provision of this
paragraph 5 relating to the time period and/or the areas of restriction and/or related
aspects shall be declared by a court of competent jurisdiction to exceed the maximum
restrictiveness such court deems reasonable and enforceable, the time period and/or areas
of restriction and/or related aspects deemed reasonable and enforceable by the court shall
become and thereafter be the maximum restriction in such regard, and the restriction shall
remain enforceable to the fullest extent deemed reasonable by such court.

     e. Executive agrees that the appropriate remedy for any breach of this paragraph 5 is
a suit for injunctive relief and specific performance

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 7

 

 

in any court of competent jurisdiction. Executive agrees that the Corporation also
has the right to seek damages for any breach of this paragraph 5, and that the
damages for breach of this paragraph shall be 100% of the gross amount of revenue
derived from the breach of the covenant in this paragraph 5. The Corporation has
sole discretion regarding whether to seek a remedy for breach of this paragraph in a
Court of competent jurisdiction and/or through arbitration procedures outlined in
paragraph 8.

1.
Termination. This Agreement will terminate as follows:

     a. Death. Executive’s employment hereunder shall automatically terminate upon
his death.

     b. Disability. The Corporation may terminate the Executive’s employment hereunder in
the event of the Executive’s Disability (as hereinafter defined). For purposes of this
Agreement, “Disability” shall mean that, as a result of the Executive’s incapacity due to
illness or injury, Executive shall have been absent from his duties
under this Agreement on
a substantially full-time basis for a period of three (3) or more consecutive months, and
thereafter, within thirty (30) days after the Corporation notifies Executive in writing
that it intends to replace him, Executive shall not have returned to the performance of such
duties on a full-time basis. Should Executive be diagnosed as permanently disabled by his
treating physician, the Corporation can terminate his
employment without waiting for the expiration of the three-month period.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 8

 

 

Without
limiting the foregoing, until the Corporation terminates
Executive’s employment
hereunder on account of Disability, the Executive shall receive his full compensation as
provided in Paragraph 3 of this Agreement.

     c. By Executive. Executive may resign at any time upon thirty (30) days notice to the
Chief Executive Officer of the Corporation.

     d. By the Corporation.

     (1) The Corporation may terminate Executive for any reason or no
reason upon thirty (30) days written notice to Executive.

     (2) The Corporation may terminate Executive immediately for overt
misconduct. For purposes of this Agreement, “Overt Misconduct” means
willful violation of any rule or regulation that may be established from
time to time for the conduct of the Corporation’s business, for neglect
of the interests of the Corporation, breach of fiduciary duty involving
personal profit, willful violation of any law, rule, regulation (other
than traffic violations or similar minor offenses), or material breach of
any provision of this Agreement.

2. Payments
Upon Termination. Payments to Executive upon termination shall be as
follows:

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 9

 

 

     a. Upon Death. Executive’s estate shall be entitled to his earned, but unpaid base salary, pro
rata bonus, and to exercise vested stock options as of the date of death.

     b. Upon Disability. Executive shall be entitled to his earned, but unpaid base salary, pro
rata bonus, and to exercise vested stock options through the effective date of termination.

     c. Upon Resignation by Executive. In the event of any resignation by Executive, Executive
shall be entitled to his earned, but unpaid salary and to exercise vested stock options
through the effective date of the resignation.

     d. Upon Termination for Overt Misconduct. Executive shall be entitled to his earned but
unpaid base salary and to exercise vested stock options through the effective date of
termination for Overt Misconduct.

     e. Upon Termination by the Corporation for Other than Overt Misconduct. If the Corporation
terminates Executive’s employment for any reason other than Overt Misconduct, Executive
will be eligible for three (3) months’ severance pay at his base annual rate. Eighty
percent of this severance payment will be allocated to Executive’s agreement to abide by
the convenant not to compete provisions and nondisclosure requirements contained in
paragraphs 4 and 5 of this Agreement. Executive will be entitled to the severance payment
only if he executes a general release of all claims against the Corporation.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 10

 

 

     3.
Arbitration. Subject to the provisions of paragraphs 4 and 5, Executive and
Corporation agree that all Disputes, as defined in Article
I of the Alternative Dispute Resolution Procedure (the “ADR Procedure”), regarding the
termination of employment or other covered Dispute shall be resolved exclusively in accordance
with the Corporation’s ADR Procedure. The parties, however, agree that the ADR
Procedure does not apply to claims for unemployment compensation benefits or claims by the
Corporation for injunctive relief, specific performance, and/or damages as provided for in
paragraphs 4 and 5 of this Agreement. Executive represents, warrants and agrees that (a)
Executive has received, read and understands the Corporations ADR Procedure; (b) Executive must
file a claim, if any,
under the ADR Procedure within one-hundred and eighty(180) days of being notified of the
termination or other adverse employment decision; (c) arbitration may be compelled and enforced
under the Federal Arbitration Act; (d) any arbitration award is final and binding
upon both Executive and the Corporation; (e) the ADR Procedure shall survive the
employer-employee relationship and applies to any Dispute whether it is asserted during or after
Executive’s separation of employment; and (f) the ADR Procedure does not alter the parties’
“at-will” employment relationship.

     4. Resignation
Upon Termination. In the event of separation of Executive’s
employment with the Corporation, Executive hereby agrees to resign from all positions held
in the Corporation, including, without limitation, any position of director, officer,
agent, trustee, or consultant of the Corporation.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 11

 

 

     5. Waiver.
A party’s failure to insist on compliance or enforcement of any
provision of this Agreement, shall not affect the validity or enforceability or constitute
a waiver of future enforcement of that provision or of any other provision of this
Agreement by that party or any other party.

     6. Governing
Law. This Agreement shall in all respects be subject to, and governed
by, the laws of the State of Texas.

     7. Sererability. The invalidity or unenforceability of any provision in the
Agreement shall not in any way affect the validity or enforceability of any other provision
and this Agreement shall be construed in all respects as if such invalid or unenforceable
provision had never been in the Agreement.

     8. Notice.
Any and all notices required or permitted herein shall be deemed
delivered if delivered personally or if mailed by
registered or certified mail to the Corporation at its principal place of business and to
Executive at the address hereinafter set forth following Executive’s signature, or at such
other address or addresses as either party may hereafter designate in writing to the other.

     9. Assignment. This Agreement, together with any amendments hereto, shall be binding upon
and shall inure to the benefit of the parties hereto and their respective successors,
assigns, heirs and personal representatives, except that the rights and benefits of either
of the parties under this Agreement may not be assigned without the prior written consent
of the other party.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 12

 

 

     10. Amendments.  This Agreement may be amended at any time by mutual consent of the
parties hereto, with any such amendment to be invalid unless in writing, signed by the
Corporation and Executive.

     11. Entire Agreement. This Agreement contains the entire agreement and
understanding by and between Executive and the Corporation with respect to the employment
of Executive, and no representations, promises, agreements, or understandings, written or
oral, relating to the employment of Executive by the Corporation not contained herein shall
be of any force or effect.

     12. Burden and Benefit. This Agreement shall be binding upon, and shall inure to the benefit
of, the Corporation and Executive, and their respective heirs, personal and legal representatives,
successors, and assigns.

     13. References to Gender and Number Terms. In construing this Agreement, feminine
or number pronouns shall be substituted for those masculine in form and vice versa, and
plural terms shall be substituted for singular and singular for plural in any place which
the context so requires.

     14. Headings. The various headings in this Agreement are inserted for convenience
only and are not part of the Agreement.

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 13

 

 

     IN WITNESS WHEREOF, the Corporation and Executive have duly executed this Agreement as of the
day and year first above written.

	 	 	 	 	 	 	 	 	 
	INTERPHASE CORPORATION:	 	 	 	EXECUTIVE’S NAME	 	 
	 
	 	 	 	 	 	 	 	 
	By:
	 	/s/ R. Stephen Polley	 	 	 	/s/ Felix V. Diaz	 	 
	 

	 	 

R. Stephen Polley
	 	 	 	 

Felix Diaz
	 	 
	 
	 	 	 	 	 	 	 	 
	Its:

	 	Chairman, C.E.O. & President	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Address for Notice Purposes:	 	 	 	Address for Notice Purposes:	 	 
	 
	 	 	 	 	 	 	 	 
	Interphase Corporation	 	 	 	 	 	 
	13800 Senlac Road	 	 	 	 	 	 
	Dallas, Texas 75234	 	 	 	 	 	 

EMPLOYMENT
AGREEMENT FOR CHIEF TECHNOLOGY OFFICER — Page 14exv10wxky

 

Exhibit 10(k)

[THIS AGREEMENT IS SUBJECT TO ARBITRATION]

EMPLOYMENT, CONFIDENTIALITY, AND NON-COMPETITION AGREEMENT

     This “Agreement” is between the “Company,” Interphase Corporation, and Thomas N. Tipton,
Jr., “Executive.” The Company is organized under the laws of the State of Texas. Its
principal place of business is located at 2901 North Dallas Parkway, Suite 200, Plano, TX 75093.

Background Statement

     The Company enables rapid platform design and integration for the global voice and data
communications markets through custom and off-the-shelf communications equipment, embedded software
development suites, and systems integration and consulting services for telecom and enterprise
networks. Executive desires to be employed or continue to be employed by the Company. The Company
desires to employ Executive, provided that as an express, prior condition of such employment,
Executive enters into this Agreement with the Company.

     This Agreement sets forth the terms of Executive’s employment. The parties agree that this
Agreement is supported by valuable consideration, that mutual promises and obligations have been
undertaken by the parties to it, and that the agreement is entered into voluntarily by the parties.

Statement of Agreement

	1.	 	Duties. Executive shall devote Executive’s best efforts to the business of the Company.
Executive shall perform such duties and responsibilities customary to the position of Chief
Financial Officer and Vice President of Finance, including those described on Exhibit A to
this Agreement. Executive shall also perform those duties assigned by the Company from time
to time.
	 
	2.	 	Terms. The “initial term” of employment under this Agreement shall terminate six (6) months
after the date of this Agreement. The initial term of this Agreement shall automatically
renew for successive six (6) month periods, referred to as “successor terms,” unless either
party gives thirty (30) days written notice of its intention not to renew prior to the
expiration of the initial or any successor term or Executive is terminated for cause.

Page 1

 

	3.	 	Terminable Only For Cause. This Agreement may be terminated by the Company prior to the
expiration of the initial term or any successor term as follows:

	 	(a)	 	Due to the death of Executive;
	 
	 	(b)	 	Due to a physical or mental disability which prevents Executive from performing
the essential functions of his full duties for a period of ninety (90) consecutive days
during the term of this Agreement, as determined in good faith by a physician
reasonably acceptable to the Company; or,
	 
	 	(c)	 	For Cause, which is (i) fraud, misappropriation, embezzlement, dishonesty, or
other act of material misconduct against the Company or any affiliate of the Company;
(ii) failure to perform specific and lawful directives of Executive’s superiors; (iii)
violation of any rules or regulations of any governmental or regulatory body, which is
materially injurious to the financial condition of the Company; (iv) conviction of or
plea of guilty or nolo contendere to a felony; (v) violation of the provisions of 8, 9,
10, 11, 13, or 16; or, (vi) substantial failure to perform the duties and
responsibilities of Executive under this Agreement.

	 	 	In the event of termination under this paragraph, Executive shall be entitled only to
Executive’s base salary earned through the date of termination. No accrued but unpaid
bonuses or commissions shall be due to Executive.

	4.	 	Termination Without Cause or Nonrenewal. In the event the Company gives Executive thirty
days written notice of its intention not renew a term of this Agreement, or if Executive is
terminated without cause after the expiration of the initial term, the Executive shall receive
an amount equal to six-months severance pay based on the Executive’s base salary at the time
of termination, payable in bi-monthly or bi-weekly installments as dictated by the regular pay
dates of the Company. No accrued but unpaid bonuses or commissions shall be due to Executive
under this Paragraph. No other severance payment or benefits shall be due Executive other
than those provided for under this Agreement. Notwithstanding anything stated herein to the
contrary, in the event Executive becomes employed during the period in which the Executive is
eligible to receive post-employment payments under this Paragraph, any amounts received by
Executive in the form of compensation, salary, or other payments shall be offset or shall
reduce any amounts or liability owed by the Company to the Executive under this Paragraph.

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	5.	 	Compensation. Employer shall pay and provide benefits to Executive according to the
provisions of Executive’s compensation plan described in the attached Exhibit B.
Executive’s compensation plan shall be reviewed on a periodic basis. The Company reserves
the right, and Executive hereby authorizes Company, to make deductions from Executive’s pay
or bonuses to satisfy any outstanding obligations of Executive to the Company. The Company
may offset against the final payment of wages or bonuses owed to Executive any amounts due
the Company from Executive.
	 
	6.	 	Changes in Position, Location, or Compensation. If the Company transfers, promotes, or
reassigns Executive to another position or geographic area, or both parties agree to a change
in compensation or benefits during a term of this Agreement or upon the renewal of a term of
this Agreement, an updated employment agreement may be substituted by agreement of the parties
but is not required. Mutually-agreeable changes in compensation or benefits shall be effected
by amendment to and incorporation of a modified Exhibit B, initialed by the parties or their
authorized representative. All provisions, promises, terms or conditions not modified by an
amendment of 
Exhibits A—C shall remain in effect and shall not be deemed revoked or
modified beyond the changes set forth in one or more amended Exhibits.
	 
	7.	 	Executive Representation/Warranty. Executive represents that Executive is not a party to any
agreement with a third party, or limited by a court order, containing a non-competition
provision or other restriction which would preclude Executive’s employment with Company or any
of the services which Executive will provide on the Company’s behalf.
	 
	8.	 	Duty of Loyalty. Executive acknowledges the common law duties of reasonable care, loyalty,
and honesty which arise out of the principal/agent relationship of the parties. While
employed and thereafter for whatever term the law may impose, Executive shall not engage in
any activity to the detriment of the Company. By way of illustration and not as a limitation,
Executive shall not discuss with any customer or potential customer of the Company any plans
by Executive or any other Executives of the Company to leave the employment of the Company and
compete with the Company.
	 
	9.	 	Company Documents. Executive agrees and acknowledges that Executive holds as the Company’s
property all memoranda, books, papers, letters, and other data, including duplicates, relating
to the Company’s business and affairs (“Company Documents”). This includes Company Documents
created or used by Executive or otherwise coming into Executive’s possession in connection
with the performance of Executive’s job duties. All Company Documents in the possession,
custody, or control of Executive shall be returned to the Company at the time of termination
of employment.

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Confidential Information and Non-Competition

	10.	 	In exchange for the mutual promises and obligations contained in this Agreement, and
contemporaneous with its execution or soon thereafter, Employer promises to deliver to
Executive or permit Executive to acquire, be exposed to, and/or have access to material, data,
and information of the Company and/or its customers or clients that is confidential,
proprietary and/or a trade secret (“Confidential Information”). At all times, both during and
after the termination of employment, the Executive shall keep and retain in confidence and
shall not disclose, except as required in the course of the Executive’s employment with the
Company, to any person, firm or corporation, or use for the Executive’s own purposes, any
Confidential Information. For the purposes of this paragraph, such information shall include,
but is not limited to:

	 	1.	 	The Company’s standard operating procedures, processes, formulae, know-how,
scientific, technical, or product information, whether patentable or not, which is of
value to the Company and not generally known by the Company’s competitors;
	 
	 	2.	 	All confidential information obtained from third parties and customers
concerning their products, business, or equipment specifications;
	 
	 	3.	 	Confidential business information of the Company, including, but not limited
to, marketing and business plans, strategies, projections, business opportunities,
client identities or lists, sales and cost information, internal financial statements
or reports, profit, loss, or margin information, customer price information; and,
	 
	 	4.	 	Other information designated by the Company or deemed by law to be confidential
information.

	11.	 	Non-Competition. In consideration of the mutual promises contained in this Agreement,
the sufficiency of which is acknowledged by the parties, Executive agrees that during the term
of his employment and for a period of twelve (12) calendar months after termination of
employment from the Company (whether voluntary or involuntary), Executive shall not, directly
or indirectly, either as principal, agent, manager, employee, partner, shareholder, director,
officer, consultant or otherwise:

	 	1.	 	Become associated or affiliated with, employed by, or financially interested in
any business operation which competes in the business currently engaged in by Company.
(The phrase “business currently engaged in by the Company” includes, but is not limited
to, the type of activities in which the Company was engaged during Executive’s tenure,
such as designs and delivers high performance connectivity adapters for computer and
telecommunication networks.)

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	 	2.	 	Solicit or attempt to solicit the business or patronage of any person, firm,
corporation, partnership, association, department of government or other entity with
whom the Company has had any contact during a period of twelve (12) calendar months
preceding the date of this Agreement (“Customers”), or otherwise induce such Customers
to reduce, terminate, restrict or otherwise alter business relationships with the
Company in any fashion; or,
	 
	 	3.	 	In any way solicit or attempt to solicit the business or patronage of any
Customers.
	 
	 	4.	 	The parties intend the above restrictions on competition to be completely
severable and independent, and any invalidity or unenforceability of any one or more
such restrictions shall not render invalid or unenforceable any one or more
restrictions.

	12.	 	Limitations on Scope. In recognition of the broad geographic scope of the Company’s business
and the ease of competing with the Company in any part of the United States, the restrictions
on competition set forth herein are intended to cover the following geographic areas:

	 	1.	 	The geographic territory identified on the attached Exhibit C;
	 
	 	2.	 	The cities containing a facility or operation owned or managed by the Company;
and,
	 
	 	3.	 	A fifty (50) mile radius outside the boundary limits of each such city.

	   	    	The parties intend the above geographical areas to be completely severable and independent,
and any invalidity or unenforceability of this Agreement with respect to any one area shall
not render this Agreement unenforceable as applied to any one or more of the other areas.

	13.	 	Non-Solicitation of Employees. During employment and for a period of twelve (12) months
after termination, Executive agrees not to hire, employ, solicit, divert, recruit, or attempt
to induce, directly or indirectly, any existing or future employee of the Company to leave
their position with the Company or to become associated with a competing business.

Remedies for Breach

	14.	 	Company’s Right to Obtain an Injunction. Executive acknowledges that the Company will have
no adequate means of protecting its rights under Paragraphs 10, 11, 12, or 13 of this
Agreement other than be securing an injunction (a court order prohibiting the Executive from
violating the Agreement). Accordingly, the Executive agrees that the Company is entitled to
enforce this Agreement by obtaining a temporary, preliminary, and permanent injunction and any
other appropriate equitable relief. Executive acknowledges that the Company’s recovery of
damages will not be an adequate means to redress a breach of this Agreement. Nothing

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	 	 	contained in this paragraph, however, shall prohibit the Company from pursuing any remedies
in addition to injunctive relief, including recovery of damages. Executive expressly
acknowledges that the Company has sole discretion regarding whether to seek a remedy for
breaches of Paragraphs 10, 11, 12, or 13 in a court of competent jurisdiction or by
arbitration procedures outlined in paragraph 15.
	 
	15.	 	Arbitration. Executive and the Company agree that any unresolved dispute or controversy
involving a claim for monetary damages and/or declaratory or injunctive relief arising under
or in connection with this Agreement shall be settled exclusively by arbitration, conducted
before a single arbitrator in Dallas, Texas, according to the rules of the American
Arbitration Association then in effect. Judgment may be entered on the arbitrator’s award in
any court having jurisdiction. The direct expense of any arbitration proceeding shall be
borne by the Company. Notwithstanding the foregoing, nothing in this Paragraph is intended to
subject a claim by either party arising under Paragraphs 10, 11, 12, or 13 to mandatory
arbitration. Any claim arising under Paragraphs 10, 11, 12, or 13 shall be litigated in the
courts of the relevant jurisdiction and venue.

Inventions and Discoveries

	16.	 	Discoveries, Inventions, & Copyrights. Executive shall disclose promptly to the Company any
and all conceptions and ideas for inventions, improvements, and valuable discoveries, whether
patentable or not, which are conceived or made by the Executive, solely or jointly, during
Executive’s term of employment and which pertain to the business activities of the Company.
Executive hereby assigns and agrees to assign all his interest therein to the Company or to
its nominee. Whenever requested to do so by the Company, Executive shall execute any and all
applications, assignments, or other instruments which the Company shall deem necessary to
apply for and obtain Letters of Patent of the United States or any foreign country or to
otherwise protect the Company’s interest therein.

General Provisions

	17.	 	Condition to Seeking Subsequent Employment. Executive agrees to show a copy of this
Agreement to any Competitor with whom Executive interviews during the Executive’s employment
with the Company or with whom the Executive interviews within twelve (12) months following the
effective date of the termination of the Executive’s employment with the Company.
	 
	18.	 	Attorneys’ Fees. If any party shall obtain a final judgment of a court of competent
jurisdiction, subject to no further appeal, pursuant to which any other party shall be
determined to have breached its obligations hereunder or made any misrepresentations, such
prevailing party shall be entitled to recover, in addition to any award of damages, reasonable
attorneys’ fees, costs, and expenses incurred by such party in obtaining such judgment.

Page 6

 

	19.	 	Non-Disparagement and Confidentiality. Except as may be required by law or as consented
to in writing by an authorized officer or agent of the Company, Executive agrees not to make
any statements whatsoever, directly or indirectly, written or oral, which could reasonably
become public, which could be interpreted as embarrassing, disparaging, prejudicial, or in
any way detrimental or inimical to the interests of the Company. Furthermore, Executive
agrees to hold confidential and not to disclose, make public, or to communicate orally or in
writing to any person or entity (other than Executive’s significant other and immediate
family), directly or indirectly, the terms of this Agreement or any matters set forth
herein, except only: (a) as may be compelled by court orders; (b) as may be necessary to
enforce the terms of this Agreement; (c) to legal, accounting, and financial advisors; (d)
as may be necessary in connection with the application for or obtaining loans or credit; (e)
as may be necessary to comply with applicable laws and government regulations; or, (f) as
may be necessary or desirable in obtaining future employment.
	 
	20.	 	Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the
Company, its subsidiaries, affiliates, successors, and assigns.
	 
	21.	 	Nonwaiver. Any waiver by the Company of a breach of any provision of this Agreement must be
in writing and signed by the Company to be effective. Any waiver by the Company of a breach
of any provision of this Agreement shall not operate or be construed as a waiver by the
Company of any different or subsequent breach of this Agreement by Executive.
	 
	22.	 	Applicable Law. This Agreement shall be construed in accordance with and governed by the
laws of the State of Texas, without giving effect to the conflict of laws provisions thereof.
	 
	23.	 	Forum Selection Clause. Any and all causes of action for equitable relief relating to the
enforcement of this Agreement and not otherwise subject to the mandatory arbitration
provisions of Paragraph 15 may, in the Employer’s sole discretion, be brought in the
United States District Court for the Northern District of Texas or the Dallas County District
of the Texas State Courts. The parties agree that the provisions of this paragraph benefit
both Employer and Executive. Any and all causes of action by and between Employer and
Executive can be quickly and efficiently resolved in the agreed-upon forum, which will not
unduly burden either Employer or Executive, and which will substantially aid Employer and
Executive in providing the opportunity for uniform treatment with respect to any issues
relating to the covenants contained in this Agreement.
	 
	24.	 	Entire Agreement. This Agreement represents the entire agreement between the Company and the
Executive with respect to the subject matter hereof, supersedes all prior agreements dealing
with the same subject matter, and may not be changed except in a writing signed by the party
against whom enforcement of the Agreement, as so changed, is sought.
	 
	25.	 	Severability. The invalidity of any term or provision of this Agreement, including any term
or provision of paragraphs 10, 11, 12, or 13 shall not invalidate or otherwise affect any
other

Page 7

 

	 	 	term or provision of this Agreement.
	 	 	 
	26.	 	This agreement shall be effective December 19, 2005.

	 	 	 	 	 
	 	Interphase Corporation

 	 
	 	By:  	/s/ Gregory B. Kalush
 	 
	 	 	Gregory B. Kalush
 	 
	 	Its: President and Chief Executive Officer 	 
	 
	 	Executive

 	 
	 	/s/ Thomas N. Tipton, Jr.
 	 
	 	Thomas N. Tipton, Jr. 	 
	 	 	 
	 

Page 8

 

Exhibit A

Job Description

	 	 	 
	Job Title: CFO & VP of Finance

	 	Department: Executive
	Reports To: CEO

	 	FLSA Status: Exempt
	Prepared By: G. Kalush & D. Shute

	 	Approved By: G. Kalush & D. Shute
	Prepared Date: December 12, 2005

	 	Approved Date: December 12, 2005

SUMMARY

Overall responsibility for all aspects of Finance, Treasury, Accounting, and IT for Interphase on a
worldwide basis. This position holds the responsibility for the creating, gaining approval of and
implementing the financial strategy (and architecture) for the company, including the management of
the company’s controls, establishing effective measurements and review processes, participating in
the architecture of significant transactions (whether with key OEM customers, potential M&A
activities, or key strategic partnerships). This position is a key member of the executive team and
is an officer of the company, and as such will prepare for and be a key representative of
management at all Board meetings.

ESSENTIAL DUTIES AND RESPONSIBILITIES include the following. Other duties may be assigned.
Management reserves the right to change these duties at any time.

The CFO and VP of Finance position is responsible for establishing the financial architecture for
Interphase, a publicly traded company. This includes the establishment and implementation of all of
the company’s financial controls, preparation and interpretation of financial reports in accordance
with GAAP, all SEC reporting, safeguarding of the company’s assets, sound financial guidance in all
significant transactions (whether with key OEM customers, potential M&A activities, or key
strategic partnerships), treasury functions, and assisting the CEO with company strategy and
support as necessary. This position in a “right-hand” to the CEO, and as such must act in harmony
with the direction that the CEO sets for the company.

Responsible for coordinating and ensuring the efficient and effective creation (working with other
senior executives) of the company’s annual operating and strategic plans. This includes the
development of the all financial and accounting plans and policies of the company. Prepares
financial and economic analysis for operating plans of the organization, and helps coach peer
executives to a balanced, financially sound plan.

Maintains healthy, positive and honest relationships with the banking community, public audit
partners, Wall Street analysts and shareholders.

 

 

	 	 	 
	 	 	 
	 	Directs Finance and Accounting, Treasury, MIS, and Investor Relations, establishing benchmarked
goals and creative plans to achieve those goals for each responsibility.
	 
	 	 
	 
	 	Coordinates and directs all financial operations including: budgeting, tax, audit, SEC compliance,
legal counsel, cash management, care and custody of funds and other financial assets, and business
risk management (and insurance) programs.
	 
	 	 
	 
	 	Participates in any merger and acquisition decisions, and maps all due diligence processes. This
includes potentially related activities such as business divestitures, partnerships, joint
ventures, etc. This role is a key advisor-ship role to the CEO on behalf of the company.
	 
	 	 
	 
	 	Responsible for reviewing and approving all company contractual obligations including OEM
agreements, NDA agreements, etc.
	 
	 	 
	 
	 	Responsible for the creation and leadership of the company’s investor relations program, ensure
that the company is properly and honestly promoted in the market, this will include the joint
creation of the company’s “story” and the road shows and street relationships to deliver it.
	 
	 	 
	 
	 	Responsible for producing and publishing the company’s annual report.
	 
	 	 
	 
	 	In conjunction with CEO, creates the Delegation of Authority Matrix.
	 
	 	 
	 
	 	SUPERVISORY RESPONSIBILITIES
	 
	 	 
	 
	 	The CFO directs and leads subordinate managers including: the Corporate Controller, Financial
Planning & Analysis Manager, European Finance & HR Manager, Contracts Manager, and the IT Manager.
Responsible for the overall direction, coordination, and evaluation of these units. Carries out
supervisory responsibilities in accordance with the organization’s policies and applicable laws and
governmental regulations. Responsibilities include interviewing, hiring, and training employees;
planning, assigning, and directing work; appraising performance; rewarding and disciplining
employees; addressing complaints and resolving problems, and motivating team.
	 
	 	 
	 
	 	QUALIFICATIONS To perform this job successfully, the individual must be able to perform each
essential duty satisfactorily. The requirements listed below are representative of the knowledge,
skill, and/or ability required. Reasonable accommodations may be made to enable individuals with
disabilities to perform the essential functions.
	 
	 	 
	 
	 	EDUCATION and/or EXPERIENCE
	 
	 	 
	 
	 	Bachelor’s degree (B. A.) or equivalent; plus ten or more years related experience and/or training;
or equivalent combination of education and experience. Must have
strong leadership skills and the ability to inspire and motivate teams to perform well and meet
company objectives. Must have a current CPA license in good standing.
	 

 

 

	 	 	 
	 	LANGUAGE SKILLS
	 
	 	 
	 
	 	Ability to read, analyze, and interpret financial statements and reports, complex contracts and
legal documents. Ability to write speeches and articles for publication that conform to prescribed
style and format. Ability to effectively present information to customers, the Sr. Leadership
Team, the Board of Directors, our employees, public groups, and/or the media.
	 
	 	 
	 
	 	OTHER SKILLS AND ABILITIES
	 
	 	 
	 
	 	Must have excellent communication skills (reading, writing, speaking, and presentation),
understanding of business and finance-related concepts, analytical skills, creative thinking
skills, skills in tactfully addressing various tasks, and the ability to occasionally work under
pressure or in a deadline-oriented environment. Able to communicate and partner effectively with
employees at all levels, as well as with customers, analysts, investors, the Board of Directors and
the business community. Must be able to handle multiple tasks concurrently, prioritizing as
necessary. Must be very computer literate. Proficient with the Microsoft Suite of products to
create PowerPoint presentations, Word documents, Excel spreadsheets, and do email. Strong
knowledge of database and accounting computer application systems which supply the most accurate
financial information. Excellent analytical, mathematical, and organizational skills.
	 
	 	 
	 
	 	REASONING ABILITY
	 
	 	 
	 
	 	Ability to define problems, collect data, establish facts, draw valid conclusions. Ability to
interpret an extensive variety of technical instructions in mathematical or diagram form and deal
with several abstract and concrete variables.
	 
	 	 
	 
	 	PHYSICAL DEMANDS
	 
	 	 
	 
	 	The physical demands described here are representative of those that must be met by an employee to
successfully perform the essential functions of this job. Reasonable accommodations may be made to
enable individuals with disabilities to perform the essential functions.
	 
	 	 
	 
	 	While performing the duties of this job, the employee is regularly required to use hands to finger,
handle, or feel and talk or hear. The employee frequently is required to walk, sit, and reach with
hands and arms. The employee is occasionally required to stand. The employee must occasionally
lift and/or move up to 10 pounds. Specific vision abilities required by this job include close
vision and color vision.
	 
	 	 
	 
	 	WORK ENVIRONMENT
	 
	 	 
	 
	 	The work environment characteristics described here are representative of those an employee
encounters while performing the essential functions of this job. Reasonable accommodations may be
made to enable individuals with disabilities to perform the essential functions.
	 
	 	 
	 
	 	Normal Office Environment, though some travel may be required. A valid passport will
be necessary.
	 
	 	 
	 
	 	 	 

 

 

Initials
/s/ GBK

/s/ TNT

Exhibit A

 

 

Exhibit B

Compensation

Base Salary. $5,769.23 per pay period ($150,000/year on an annual basis), of which there
are 26 in each calendar year, less deductions as may be required by law or authorized by
Executive.

Key Talent Bonus. Executive shall be eligible for an annual bonus for FY2006 of $30,000
based upon the Corporation’s existing Executive Bonus Plan. This bonus will be tied to
Executive Incentive Targets (MBOs) for 2006. The bonus will be awarded based on achievement
of specific corporate objectives, as determined by the Company, and is subject to change
annually by the Board of Directors.

Equity. The Corporation shall, according to the Company’s Long-Term Stock Incentive Plan
and with the approval of the CEO and Board of Directors, grant to Executive 10,000 shares of
restricted stock of the Company. Executive’s right, title, and interest to any stock
conferred under the Employment Agreement shall be controlled and governed by terms and
conditions of the Company’s Long-Term Stock Incentive Plan. The per share price will be
determined as of the close of NASDAQ trading on Executive’s first day of employment in the
new role.

Executive Benefit Plans. Based on the plans in force at the time, and subject to change at
any time, the Executive will be provided with a comprehensive and competitive benefits
package including medical, dental, life, AD&D, and STD, all effective on promotion date.
Executive will be 401k eligible after 60 days of employment. The Executive shall be
eligible to participate in any benefit plan maintained by the Company, according to the
terms and conditions of those plans. The Executive will pay the same as all other Executive
and non-Executive employees for health premiums.

Severance Pay. 6 months package, subject to terms and conditions. Please refer to section
4, “Termination Without Cause or Nonrenewal”, on page 2 of the Employment Agreement.

Executive Disability Plan. The Executive is eligible to apply through Interphase for a
voluntary, individual Executive Disability Plan. If approved by the carrier for coverage,
the premiums will be paid for by the Executive.

Vacation and Leave. Executive shall be entitled to three (3) weeks of vacation per year,
accrued monthly, and six (6) sick days per year, and any other paid leave benefits provided
for in the Company’s Policy Guide.

Cell Phone & Computer. Executive will be furnished with a laptop and cell phone/PDA for
business purposes.

 

 

Office Furnishings. The Company agrees to provide office space and furnishings to Executive
commensurate with the Company’s decor and culture.

Initials:/s/ GBK

/s/ TNT

Exhibit B

 

 

Exhibit C

Designated Cities — Per Paragraph 11a of Employment, Confidentiality,

and Non-Compete Agreement.

The Continental United States

Initials:/s/ GBK

/s/ TNT

Exhibit C

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