Document:

exv10w2

 

Exhibit 10.2

June 22, 2007

Steven Moore

2083 Tenth Avenue

San Francisco, CA 94116

Dear Steven:

It is our pleasure to formally invite you to join the staff of Pixelworks Inc. as Chief Financial
Officer and Vice President of Finance to be located in San Jose, California. Our employment offer
is subject to Pixelworks’ normal personnel policies and our comprehensive benefit program. As
discussed, the following items outline the terms of our offer.

You will report to Hans Olsen, Chief Executive Officer and President. This is an Exempt position
and your starting compensation will be as follows: bi-weekly rate of $9,423.08 equivalent to
$245,000 on an annual basis.

We want you to share in the success of the company through stock participation. We are offering you
200,000 shares of stock options at the closing market price on your date of hire, subject to the
Board of Directors approval, pursuant to the Company’s 2006 Stock Incentive Plan and the terms and
conditions of the Stock Option Agreement. Stock options will vest at a rate of 25% per year; the
full details will be outlined in your stock agreement documentation.

You will also be eligible to participate in the 2007 Senior Management Bonus Plan, and subject to
the terms and conditions as described in the plan document.

In the event of a Change of Control of the Company, you are subject to the terms and conditions as
stated in your Change of Control Agreement as attached (Appendix A).

Pixelworks pays bi-weekly, with pay dates every other Thursday. Paychecks will include wages due
through the two-week period (Sunday through Saturday) prior to the pay date. Should payday fall on
a holiday, it will be paid on the previous workday.

Pixelworks extends this offer to you based solely on your skills, accomplishments and growth
potential and not on any confidential or proprietary information you may have belonging to others,
including your prior employers. We request that you not disclose to Pixelworks any such
information, in the form of documents or otherwise.

Enclosed is our Non Disclosure Agreement, all employees are required to sign this document prior to
commencement of work. As with any new hire, under the Immigration Reform and Control Act of 1986
we will be required to confirm your eligibility to work in the United States within three days of
your hire date.

Pixelworks is an at-will employer, and your employment will not be for any specific period of time.
You are free to quit and the Company is free to terminate employment at any time, with or without
cause. It is further understood that this at-will employment relationship can only be changed in a
formal written employment contract signed by the Chief Executive Officer.

224 Airport Parkway, Suite 400 • San Jose, CA 95110 • Tel: 408.200.9200 • Fax: 408.200.9299

www.pixelworks.com

 

 

Pixelworks Offer Letter for: Steven L. Moore

June 22, 2007

Page 2

Please indicate your acceptance of this offer by signing and returning a copy of this letter
to our Human Resources department as soon as possible. Please note, we require receipt of this
offer letter signed by you and completed Non Disclosure Agreement (enclosed) prior to placing you
on the Pixelworks payroll. This offer will expire on June 30, 2007.

Finally, we request that you maintain confidentiality of the terms and conditions of this offer.

We sincerely hope you find this employment offer attractive and look forward to welcoming you to
the Pixelworks team. If you find that we can be of further assistance, please feel free to contact
us with any questions.

Sincerely,

/s/ Hans H. Olsen

Hans H. Olsen

President and Chief Executive Officer

I accept this contingent offer of employment with Pixelworks Inc. and agree to the terms and
conditions as stated above. I agree to commence employment on July 18, 2007 (date of
hire).

	 	 	 	 	 
	Signed:

	 	/s/ Steven L. Moore	 	 
	 

	 	 

Steven L. Moore
	 	 

Please send a copy of your signed offer letter in an envelope marked Confidential to:

Human Resources

Pixelworks Inc.

224 Airport Parkway, Suite 400

San Jose, CA 95110

Fax: (408) 200-9299

 

 

Exhibit A to Offer Letter for: Steven L. Moore

Change in Control Provisions.

     1. Termination by Company During Control Change Window. If Executive is terminated by Company
or its successor-in-interest without Cause during a Control Change Window, then Acceleration shall
take place as of the termination time and date.

     2. Definitions.

          2.1 “Acceleration.” “Acceleration” shall mean that the first allowed exercise date of
Executive’s subject options, and the vesting date of all other subject rights to equity (stock or
stock units or other equity-related rights of whatever description) shall be reset to immediately
prior to the time in question. Rights and options shall be “subject” if they are granted, or
committed subject to board action, in the agreement or letter to which these provisions attach, and
if they would otherwise first become exercisable, or vest, in a window beginning at the time in
question and ending at the end of the defined Acceleration Period.

          2.2 “Acceleration Period.” The “Acceleration Period” will be equal to twelve months.

          2.3 “Cause.” “Cause” shall have the same meaning as in Executive’s Severance Agreement.

          2.4 “Company.” “Company” shall mean Pixelworks, Inc.

          2.5 “Control Change.” A “Control Change” is the sale of substantially all Company’s assets
to, or acquisition of a majority of Company’s voting stock or entry into a voting or common control
agreement covering a majority of the company’s voting stock by, an entity (or a set of entities
under effective common control) in which those controlling the acquiring entity or entities are not
the same as those who have majority ownership and effective control of Company before the sale,
acquisition, or agreement date (as the case may be.)

          2.6 “Control Change Window.” A “Control Change Window” begins on the date a binding agreement
is signed to effect a Control Change, and ends on the earlier of 1) the date that agreement
terminates without a Control Change, or 2) three years after the date of closing of the Control
Change.

          2.7 “Executive.” “Executive” shall mean the Pixelworks employee to whom rights in Pixelworks
equity are granted under the agreement or letter to which these terms are attached.exv10w3

 

Exhibit 10.3

SEVERANCE AGREEMENT

     This Severance Agreement (the “Agreement”) is made and entered into June 22, 2007, by and
between Steve Moore (the “Executive”) and Pixelworks, Inc., an Oregon corporation (“Company”).

RECITALS

     A. Executive has been offered the position of CFO of the Company, and Company wishes to offer
him the position. Executive will begin no later than July 18, 2007.

     B. Company wishes to provide additional security to Executive through provision of a Severance
Benefit, as described herein, after the date on which this Agreement becomes operative.

AGREEMENT

     NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which the parties
acknowledge, the parties agree as follows:

          1. Termination by Company without Cause. In the event Company terminates Executive’s
employment without Cause, as that term is defined below, then upon Executive’s satisfaction of the
Release of Claims requirement stated in Paragraph 4 below, Company shall provide Executive with the
following severance benefits: (a) Twelve (12) months of base salary, if Executive is terminated
before January 18, 2008; (b) Six (6) months plus the length of time remaining between the
termination date and July 18, 2008, of base salary, if Executive is terminated between January 18,
2008 and July 17, 2008 inclusive; (c) Six (6) months of base salary, if Executive is terminated
after July 17, 2008, and (b) in the event Executive is eligible for and properly elects to continue
his group health benefits through COBRA, the Company shall pay Executive an amount equal to the
premium cost to continue such benefits for twelve (12) months. The severance benefits shall be
payable in a lump sum on or before the first regularly scheduled pay date following Executive’s
satisfaction of the Release of Claims requirement stated in Paragraph 4 below. All payments to
Executive shall be reduced by such amounts as are required to be withheld by law. Severance
benefits shall not be owed if termination of Executive’s employment with Company occurs due to
Executive’s death, disability, Executive’s resignation, or Company’s termination of Executive for
Cause.

          2. Cause Definition. “Cause” shall mean any one or more of the following: (i) a
material act of dishonesty, fraud, or misconduct by the Executive that is in connection with
Executive’s responsibilities as an Executive of the Company; (ii) Executive’s commission of acts
constituting a felony which the Board reasonably believes has had or will have a material
detrimental effect on the Company’s reputation or business; or (iii) repeated willful failure by
the Executive to perform Executive’s duties as an employee of the Company after there has been delivered to the Executive a written demand
for performance from the Company which describes the basis for the Company’s

 

 

belief that the
Executive has not substantially performed Executive’s duties and had a 30-day opportunity to cure,
no cure having been made. 

          3. At-Will Employment. The Company and the Executive acknowledge that the Executive’s
employment is and shall continue to be at-will, as defined under applicable law. The severance
benefits in this Agreement shall be in lieu of the severance benefits in the Offer Letter and in
lieu of any other severance benefits or policies maintained by Company that may otherwise be
applicable to Executive.

          4. Execution of Release As a condition of receiving the severance benefits, Executive
shall, on or before forty-five (45) days after Company delivers the release to Executive, enter
into and not revoke a general release of claims against the Company, its subsidiaries and
affiliates, satisfactory to Company. The release shall be substantially in the form attached
hereto as Exhibit A, with such modifications as Company determines to be reasonably necessary or
desirable to ensure effective release of all claims.

          5. Notices. Notices and all other communications contemplated by this Agreement shall
be in writing and shall be deemed to have been duly given when personally delivered or when mailed
by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of
the Executive, mailed notices shall be addressed to Executive at the home address which Executive
most recently communicated to the Company in writing. In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be directed to the
attention of its Secretary.

          6. Arbitration. Any dispute or controversy arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity, construction, performance, breach,
or termination thereof, shall be settled by binding arbitration before a single arbitrator to be
held in Portland, Oregon, in accordance with the National Rules for the Resolution of Employment
Disputes then in effect of the American Arbitration Association (the “Rules”). The decision of the
arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may
be entered on the arbitrator’s decision in any court having jurisdiction. The arbitrator shall
apply Oregon law to the merits of any dispute or claim, without reference to conflicts of law
rules.

          7. Integration. This Agreement replaces the severance provisions of the Offer Letter.
Except as expressly stated in this paragraph, the Offer Letter remains in effect according to its
terms. This Agreement and the Offer Letter represent the entire agreement and understanding
between the parties as to the subject matter herein and supersede all prior or contemporaneous
agreements, whether written or oral.

          8. Severability. The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other provision hereof, that
can be given effect without the invalid or unenforceable provisions of the Agreement.

Page 2
— Severance Agreement

 

 

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by
its duly authorized officer, as of the day and year first above written.

	 	 	 	 	 
	 	PIXELWORKS, INC.

 	 
	 	By:  	Hans H. Olsen
 	 

	 	 	 	 	 	 	 
	 

	 	Title:
	 	President and Chief Executive Officer	 	 
	 

	 	 	 	 

	 	 

	 	 	 	 	 
	 	EXECUTIVE

 	 
	 	/s/ Steven L. Moore
 	 
	 	Steven L. Moore 	 
	 	 	 
	 

Page 3 — Severance Agreement

 

 

Exhibit A to Severance Agreement of Steven L. Moore

RELEASE OF CLAIMS

This Document Affects Important Legal Rights You May Have.

Please Read It Carefully Before Signing.

     For and in consideration of the severance benefits described in the Severance Agreement dated
as of June 22, 2007 between Pixelworks, Inc. (the “Company”), and Steve Moore (the “Executive”),
and for other good and valuable consideration, Executive hereby releases the Company, its
divisions, affiliates, subsidiaries, parents, branches, predecessors, successors, assigns,
officers, directors, trustees, employees, agents, shareholders, members, administrators,
representatives, attorneys, insurers and fiduciaries, past, present and future (the “Released
Parties”) from any and all claims of any kind that Executive now has or may have against the
Released Parties, whether known or unknown to Executive, by reason of facts that have occurred on
or prior to the date that Executive has signed this Release. Such released claims include, without
limitation, any and all claims for other severance benefits pursuant to any Company severance pay
policy, and any and all claims under federal, state or local laws pertaining to employment,
including the Age Discrimination in Employment Act, 29 U.S.C. Section 621 et seq., Title VII of the
Civil Rights Act of 1964, as amended, 42 U.S.C. Section 2000e et seq., the Fair Labor Standards
Act, as amended, 29 U.S.C. Section 201 et seq., the Americans with Disabilities Act, as amended, 42
U.S.C. Section 1981 et seq., the Family Medical Leave Act of 1992, 29 U.S.C. Section 2601 et seq.,
and any and all state or local laws regarding employment discrimination and/or federal, state or
local laws of any type or description regarding employment, including but not limited to any claims
arising from or derivative of my employment with the Company and its subsidiaries, as well as any
and all claims under state contract or tort law.

[* * * To be completed if Executive is over age 40 on date of termination]. In accordance with the
Age Discrimination in Employment Act and Older Workers’ Benefit Protection Act (collectively, the
“Act”), Executive acknowledges that: (1) s/he has been, and hereby is, advised in writing to
consult with an attorney prior to executing this Release; (2) s/he is aware of certain rights to
which s/he may be entitled under the Act; (3) as consideration for executing this Release,
Executive has received additional benefits and compensation of value to which s/he would otherwise
not be entitled; (4) by signing this Release, s/he will not waive rights or claims under the Act
which may arise after the execution of this Release; (5) Executive has been given a period of at
least 21 days from                      to consider this offer; (6) in the event s/he has not executed
this Release on or before                     , the offer shall expire; (7) in the event Executive
signs the Release prior to 21 days, s/he does so voluntarily; (8) any changes to the terms of the
Agreement, whether material or immaterial shall not re-start the 21-day consideration period; (9)
Executive has a period of seven days from the date of execution in which to revoke this Release by
written notice to                                         ; (10) in the event Executive does not exercise
his/her right to revoke this Release, the Release shall become effective on the date (the
“Effective Date”) immediately following the seven-day waiting period described above.

Page 4 — Severance Agreement

 

 

     Executive has read this release carefully, acknowledges that s/he has been given at least 21
days to consider all of its terms, and have been advised to consult with an attorney and any other
advisors of his or her choice prior to executing this Release, and Executive fully understands that
by signing below s/he is voluntarily giving up any right which Executive may have to sue or bring
other claims against the Released Parties. Finally, Executive has not been forced or pressured in
any manner whatsoever to sign this Release, and Executive agrees to all of its terms voluntarily.

     This Release is final and binding and may not be changed or modified except in a writing
signed by an authorized representative of the parties. If any part of this Release is held invalid,
the invalidity shall not affect other parts of the Release that can be given effect without the
invalid parts.

     The severance check will be mailed to Executive’s last home address on file with Company.

	 	 	 	 	 	 	 
	 

	 	 	 	Date:	 	 
	 

	 	 	 	 	 	 
	Steven L. Moore
	 	 	 	 	 	 

Page 5 — Severance Agreement

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