Document:

Exhibit 10.1

 

WJ Communications, Inc.

401
River Oaks Parkway

San
Jose, CA 95134

 

July 18, 2005

 

Personal
and Confidential 

 

Re:  Offer of Employment

 

Dear Mr. Knoch:

 

We are pleased to
offer you a position with WJ Communications, Inc., as Vice President of
Operations at a starting annual salary of $200,000/year.  In this position, you will report directly to
myself. Your responsibilities will include all functions associated with
operations of the Company, including sustaining engineering, quality and planning
groups.  You will also have duties and
responsibilities assigned to you from time to time by myself and by the Company’s
Board of Directors.

 

This offer letter
is not an employment contract, but is intended to describe the basic terms of
your employment.  The exact terms of your
employment will be as set forth in an Employment Agreement, which will contain
specific details regarding your compensation, benefits, and obligations as an
Officer of WJ Communications, and in the other documents described below.  We will prepare the Employment Agreement
within 30 days of your employment at WJ. 
Your employment package will include the following:

 

•                  You will
participate in the Top Management Incentive Bonus program, which provides a
target bonus up to a maximum of 60% of your base salary to be paid
quarterly.  Your actual bonus will depend
on two things: achievement of the Company’s revenue and profitability
objectives and achievement of certain individual objectives defined each
quarter.  You will be guaranteed $20,000
bonus for the year ending 2005 plan of your employment.

 

•                  You will receive
a sign-on bonus of $20,000, less applicable taxes, upon commencing employment.

 

•                  As part of
this offer, you will be granted an option to purchase 450,000 shares of WJ Communications, Inc.
Common Stock on or about the date you commence employment.  Your option to
purchase WJCI stock will be issued at fair market value per share on the date
you commence employment, in accordance with the WJ Communications, Inc.
2000 Employee Stock Incentive Plan.  This
option to purchase Common Stock will vest over a four-year period from the
commencement date of your employment in accordance with the vesting and
acceleration provisions set forth in your Employment Agreement.

 

•                  Upon
successful completion of outsourcing the fab, we will recommend to the Board
for approval to grant 75,000 shares of restricted stock upon successful
completion of that objective.

 

 

•                  During your
employment at WJ, you shall be entitled to participate in the Company’s fringe
benefit plans for its executives, subject to and in accordance with applicable
eligibility requirements, such as group medical, dental, and vision care
insurance, executive medical reimbursement (to cover deductibles, co-pays, and
other legitimate medical and dental costs not covered by insurance), tax
preparation, 401(k), employee stock purchase program, life and disability
insurance plans and all other benefit plans (other than severance and
equity-based plans or arrangements) generally available to the Company’s
executive officers.  In addition, the
Company will reimburse your reasonable out-of-pocket expenses incurred in
connection with the performance of your duties hereunder, consistent with
Company policy.  You shall be entitled to
take time off in accordance with the Company’s top management vacation policy.

 

•                  Upon commencing
employment you may elect to participate in the WJ Employees’ Investment Plan,
which enables you to invest pre-tax dollars into a qualified 401(k) plan. The
plan includes up to a 3% Company matching contribution.

 

•                  Also, upon
completion of your first 90 days with WJCI, you will be eligible to participate
in the WJ Communications, Inc. Employee Stock Purchase Plan, which enables
you to purchase shares of WJCI common stock at 15% less than the Fair Market
Value on either the first or last day of the Offering Period, whichever is
lower.

 

•                  Your Employment
Agreement will contain confidentiality and non-solicitation covenants by you
agreeing not to solicit employees of the Company or use or disclose the Company’s
confidential information or trade secrets during or after your employment with
the Company.

 

•                  Your Employment
Agreement will contain a provision in which you agree that the Company’s
intellectual property, including, but not limited to, intellectual property
developed by you in the course of your employment with the Company, is and
shall belong exclusively to the Company.

 

Please
understand that your employment is contingent upon successful passage of a drug
and alcohol screening test, employment and degree verifications, and criminal
background and reference checks, all of which are required by WJ Company
Policy.  It is also contingent upon our
mutual agreement as to the definitive documentation (including your Employment
Agreement) you will be required to execute and deliver with respect to your
employment.

 

We hope
you find this offer attractive and request a written reply from you by July 22,
2005.  We look forward to your joining
our staff and to a mutually profitable relationship.

 

	
  Sincerely,

  
	
  /s/ BRUCE DIAMOND

  	
   

  
	
  Bruce Diamond

  
	
  President and CEO

  
	
   

  
	
   

  
	
  I accept this offer and will commence employment as
  of August 8, 2005.

  
	
   

  
	
  Signed: /s/ MARK KNOCHExhibit 10.1

 

CUBIST PHARMACEUTICALS, INC.

 

AMENDED AND RESTATED

1997 EMPLOYEE STOCK PURCHASE PLAN

 

1.                                       Definitions.  As used in this 1997 Employee Stock Purchase
Plan of Cubist Pharmaceuticals, Inc., the following terms shall have the
meanings respectively assigned to them below:

 

(a)                                  Base Compensation means annual or annualized
base compensation, exclusive of overtime, bonuses, contributions to employee
benefit plans, or other fringe benefits.

 

(b)                                 Beneficiary
means the person designated as the Participating Employees’ beneficiary on the
Participating Employee’s Membership Agreement or other form provided by the
personnel department of the Company for such purpose or, if no such beneficiary
is named, the person to whom the Option is transferred by will or under the
applicable laws of descent and distribution.

 

(c)                                  Board
means the board of directors of the Company, except that, if and so long as the
board of directors of the Company has delegated pursuant to Section 4 its
authority with respect to the Plan to the Committee, then all references in
this Plan to the Board shall refer to the Committee acting in such capacity.

 

(d)                                 Code means the Internal Revenue Code of 1986,
as amended.

 

(e)                                  Committee means the Compensation Committee of
the Board.

 

(f)                                    Company means Cubist Pharmaceuticals, Inc., a
Delaware corporation.

 

(g)                                 Disability means, with respect to any
Participating Employee, that an independent medical doctor (selected by the
Company’s health or disability insurer) certifies that such Participating Employee
has for four (4) months, consecutive or non-consecutive, in any twelve-month
period been disabled in a manner which seriously interferes with the
performance of his or her responsibilities for the Company or applicable
Related Corporation.

 

(h)                                 Eligible Employee means a person who is
eligible under the provisions of Section 7 to receive an Option as of a
particular Offering Commencement Date.

 

(i)                                     Employer means, as to any particular Offering
Period, the Company and any Related Corporation which is designated by the
Board as a corporation whose Eligible Employees are to receive Options as of
that Offering Period’s Offering Commencement Date.

 

(j)                                     Market Value means, as of a particular date,
(i) if the Stock is listed on an exchange, the closing price of the Stock on
such date on such exchange, (ii) if the Stock is quoted through the National
Association of Securities Dealers, Inc. Automated Quotation (“NASDAQ”) National Market System or any
successor thereto, the closing price of the Stock on such date and (iii) if the
Stock is quoted through NASDAQ (but not on the National Market System) or
otherwise publicly traded, the average of the closing bid and asked prices of
the Stock on such date.

 

(k)                                  Membership Agreement means an agreement
whereby a Participating Employee authorizes an Employer to withhold payroll
deductions from his or her Base Compensation.

 

(l)                                     Offering Commencement Date means the first
business day of an Offering Period on which Options are granted to Eligible
Employees.

 

(m)                               Offering Period means a semi-annual period,
running from either January 1 to the next following June 30 or July 1
to the next following December 31, during which Options will be offered
under the Plan pursuant to a determination by the Board.

 

(n)                                 Offering Termination Date means the last
business day of an Offering Period, on which Options must, if ever, be
exercised.

 

 

(o)                                 Option means an option to purchase shares of
Stock granted under the Plan.

 

(p)                                 Option Shares means shares of Stock
purchasable under an Option.

 

(q)                                 Participating Employee means an Eligible
Employee to whom an Option is granted.

 

(r)                                    Plan means this 1997 Employee Stock Purchase
Plan of the Company, as amended from time to time.

 

(s)                                  Related Corporation means any corporation
which is or during the term of the Plan becomes a parent corporation of the
Company, as defined in Section 424(e) of the Code, or a subsidiary
corporation of the Company, as defined in Section 424(f) of the Code.

 

(t)                                    Retires means termination of employment with
the Company and all Related Corporations at or after attaining age 65.

 

(u)                                 Stock means the common stock, par value $0.001
per share, of the Company.

 

2.                                       Purpose of the Plan.  The Plan is intended to encourage ownership
of Stock by employees of the Company and any Related Corporations and to
provide an additional incentive for the employees to promote the success of the
business of the Company and any Related Corporations.  It is intended that the Plan shall be an “employee
stock purchase plan” within the meaning of Section 423 of the Code.

 

3.                                       Term of the Plan.  The Plan shall become effective on December 1,
1997 (the “Effective Date”), subject to the approval by the stockholders of the
Company on or prior to the first anniversary of the Effective Date.  No Option shall be granted under the Plan
after the date immediately preceding the tenth anniversary of the Effective
Date.

 

4.                                       Administration of the Plan.  The Plan shall be administered by the
Board.  The Board shall determine
semi-annually, on or before either December 15 and June 15, whether
to grant options under the Plan with respect to the Offering Period which would
otherwise begin as of January 1 and July 1, respectively.  The Board shall determine which (if any)
Related Corporations shall be Employers as of each Offering Commencement
Date.  Either such determination may in
the discretion of the Board apply to all subsequent Offering Periods until
modified or revoked by the Board.  The
Board shall have authority to interpret the Plan, to prescribe, amend and
rescind rules and regulations relating to the Plan, to determine the terms of
Options granted under the Plan, and to make all other determinations necessary
or advisable for the administration of the Plan.  All determinations of the Board under the
Plan shall be final and binding as to all persons having or claiming any
interest in or arising out of the Plan. 
The Board may delegate all or any portion of its authority with respect
to the Plan to the Committee, and thereafter, until such delegation is revoked
by the Board, all powers under the Plan delegated to the Committee shall be
exercised by the Committee.

 

5.                                       Termination and Amendment of Plan.  The Board may terminate or amend the Plan at
any time; provided, however, that the Board may
not, without approval by the holders of a majority of the outstanding shares of
Stock, increase the maximum number of shares of Stock purchasable under the
Plan or change the description of employees or classes of employees eligible to
receive Options.  Without limiting the
generality of the foregoing but subject to the foregoing proviso, the Board may
amend the Plan from time to time to increase or decrease the length of any
future Offering Periods (e.g., to a nine
month period) and to make all required conforming changes to the Plan.  No termination of or amendment to the Plan
may adversely affect the rights of a Participating Employee with respect to any
Option held by the Participating Employee as of the date of such termination or
amendment without his or her consent.

 

6.                                       Shares of Stock Subject to the Plan.  No more than an aggregate of 500,000 shares
of Stock may be issued or delivered pursuant to the exercise of Options granted
under the Plan, subject to adjustments made in accordance with Section 9.7.  Shares to be delivered upon the exercise of
Options may be either shares of Stock which are authorized but unissued or
shares of Stock held by the Company in its treasury.  If an Option expires or terminates for any
reason without having been exercised in full, the unpurchased shares subject to
the Option shall become available for other Options granted under the
Plan.  The Company shall, at all times
during which Options are outstanding, reserve and keep available shares of
Stock sufficient to satisfy such Options (or, if less, the maximum number still
available for issuance under the foregoing limit), and shall pay all fees and
expenses incurred by the Company in connection therewith.  In the event of any capital change in the
outstanding Stock as contemplated by Section 9.7, the number of shares of
Stock reserved and kept available by the Company shall be appropriately
adjusted.

 

7.                                       Persons Eligible to Receive Options.  Each employee of an Employer shall be granted
an Option on each Offering Commencement Date on which such employee meets all
of the following requirements:

 

(a)                                  The
employee is customarily employed by an Employer for more than twenty hours per
week and for more than five months per calendar year and, in the case of any
Offering Period after the first Offering Period under the Plan, has been
employed by one or more of the Employers for at least one week prior to the
applicable Offering Commencement Date.

 

 

(b)                                 The
employee will not, after grant of the Option, own Stock possessing five percent
or more of the total combined voting power or value of all classes of stock of
the Company or of any Related Corporation. 
For purposes of this paragraph (b), the rules of Section 424(d) of
the Code shall apply in determining the Stock ownership of the employee, and
Stock which the employee may purchase under outstanding options shall be
treated as Stock owned by the employee.

 

(c)                                  Upon
grant of the Option, the employee’s rights to purchase Stock under all employee
stock purchase plans (as defined in Section 423(b) of the Code) of the
Company and its Related Corporations will not accrue at a rate which exceeds
$25,000 of fair market value of the Stock (determined as of the grant date) for
each calendar year in which such option is outstanding at any time.  The accrual of rights to purchase Stock shall
be determined in accordance with Section 423(b)(8) of the Code.

 

8.                                       Offering Commencement Dates.  Options shall be granted on the first
business day of each semi-annual period, running from either January 1 to
the next following June 30 or July 1 to the next following December 31,
which is designated by the Board as an Offering Period.  Following designation by the Board of the
initial Offering Period under the Plan, all succeeding semi-annual periods
described above shall be deemed Offering Periods without need of further Board
action unless and until contrary action shall have been taken by the Board
prior to the beginning of what would otherwise be an Offering Period.

 

9.                                       Terms and Conditions of Options.

 

9.1                                 General. 
All Options granted on a particular Offering Commencement Date shall
comply with the terms and conditions set forth in Sections 9.2 through
9.11.  Subject to Sections 7(c) and 9.9,
each Option granted on a particular Offering Commencement Date shall entitle
the Participating Employee to purchase that number of shares equal to the
result of $25,000 (or such lesser amount as is selected by the Board, prior to
the applicable Offering Commencement Date, and applied uniformly during such
Offering Period) divided by the Market Value of one such share on the Offering
Commencement Date and then rounded down, if necessary, to the nearest whole
number.

 

9.2                                 Purchase Price.  The purchase price of Option Shares shall be
85% of the lesser of (a) the Market Value of the shares as of the Offering
Commencement Date or (b) the Market Value of the shares as of the Offering
Termination Date.

 

9.3                                 Restrictions on Transfer.

 

(a)                                  Options
may not be transferred otherwise than by will or under the laws of descent and
distribution.  An Option may not be
exercised by anyone other than the Participating Employee during the lifetime
of the Participating Employee.

 

(b)                                 The
Optionee shall agree in the Membership Agreement to notify the Company of any
transfer of Option Shares within two years of the Offering Commencement Date
for such Option Shares.  The Company
shall have the right to place a legend on all stock certificates representing
Option Shares instructing the transfer agent to notify the Company of any transfer
of such Option Shares.  The Company shall
also have the right to place a legend on all stock certificates representing
Option Shares setting forth or referring to the restriction on transferability
of such Option Shares.

 

9.4                                 Expiration. 
Each Option shall expire at the close of business on the Offering
Termination Date or on such earlier date as may result from the operation of Section 9.6.

 

9.5                                 Termination of Employment of Optionee.  If a Participating Employee ceases for any
reason (other than death or Retirement) to be continuously employed by an
Employer, whether due to voluntary severance, involuntary severance, transfer,
or disaffiliation of a Related Corporation with the Company, his or her Option
shall immediately expire, and the Participating Employee’s accumulated payroll
deductions shall be returned to the Participating Employee.  For purposes of this Section 9.5, a
Participating Employee shall be deemed to be employed throughout any leave of
absence for military service, illness or other bona fide purpose which does not
exceed the longer of ninety days or the period during which the Participating
Employee’s reemployment rights are guaranteed by statute (including without
limitation the Veterans Reemployment Rights Act or similar statute relating to
military service) or by contract.  If the
Participating Employee does not return to active employment prior to the
termination of such period, his or her employment shall be deemed to have ended
on the ninety-first day of such leave of absence (or such longer period
guaranteed by statute or by contract as provided above).

 

9.6                                 Retirement
or  Retirement or Death of Optionee.  If a Participating Employee Retires or dies,
the Participating Employee or, in the case of death, his or her Beneficiary
shall be entitled to withdraw the Participating Employee’s accumulated payroll
deductions, or to purchase shares on the Offering Termination Date to the
extent that the Participating Employee would be so entitled had he or she
continued to be employed by an Employer. 
The number of shares purchasable shall be limited by the amount of the
Participating Employee’s accumulated payroll deductions as of the date of his
or her Retirement or death.  Accumulated
payroll deductions shall be applied by the Company toward the purchase of
shares only if the Participating Employee or, in the case of death, his or her
Beneficiary submits to the Employer not later than the Offering Termination
Date a written request that the deductions be so applied.  Accumulated payroll deductions not withdrawn
or applied to the purchase of shares shall be delivered by the Company to the

 

 

Participating Employee or Beneficiary within a reasonable time after
the Offering Termination Date.

 

9.7                                 Capital Changes Affecting the Stock.  In the event that, between the Offering
Commencement Date and the Offering Termination Date with respect to an Option,
a stock dividend is paid or becomes payable in respect of the Stock or there
occurs a split-up or contraction in the number of shares of Stock, the number
of shares for which the Option may thereafter be exercised and the price to be
paid for each such share shall be proportionately adjusted.  In the event that, after the Offering
Commencement Date, there occurs a reclassification or change of outstanding
shares of Stock or a consolidation or merger of the Company with or into
another corporation or a sale or conveyance, substantially as a whole, of the
property of the Company, the Participating Employee shall be entitled on the
Offering Termination Date to receive shares of Stock or other securities
equivalent in kind and value to the shares of Stock he or she would have held
if he or she had exercised the Option in full immediately prior to such
reclassification, change, consolidation, merger, sale or conveyance and had
continued to hold such shares (together with all other shares and securities
thereafter issued in respect thereof) until the Offering Termination Date.  In the event that there is to occur a
recapitalization involving an increase in the par value of the Stock which
would result in a par value exceeding the exercise price under an outstanding
Option, the Company shall notify the Participating Employee of such proposed
recapitalization immediately upon its being recommended by the Board to the
Company’s shareholders, after which the Participating Employee shall have the
right to exercise his or her Option prior to such recapitalization; if the
Participating Employee fails to exercise the Option prior to recapitalization,
the exercise price under the Option shall be appropriately adjusted.  In the event that, after the Offering
Commencement Date, there occurs a dissolution or liquidation of the Company,
except pursuant to a transaction to which Section 424(a) of the Code applies,
each Option shall terminate, but the Participating Employee shall have the
right to exercise his or her Option prior to such dissolution or liquidation.

 

9.8                                 Payroll Deductions.  A Participating Employee may purchase shares
under his or her Option during any particular Offering Period by completing and
returning to the Company’s personnel department at least ten days prior to the
beginning of such Offering Period a Membership Agreement indicating a
percentage (which shall be a full integer between one and fifteen) of his or
her Base Compensation which is to be withheld each pay period.  Unless the Board decides otherwise prior to
the commencement of an Offering Period, all Participating Employees shall be
permitted, no more often than once per Offering Period, to change the
percentage of Base Compensation withheld during an Offering Period by
submitting an amended Membership Agreement to the Company’s personnel
department indicating a different percentage of Base Compensation to be
withheld.  Any such amended Membership
Agreement shall become effective at the time determined pursuant to rules
adopted by the Board from time to time. 
In addition, no more than once per Offering Period, the Participating
Employee may cancel his or her Agreement and withdraw all, but not less than
all, of his or her accumulated payroll deductions by submitting a written
request therefor to the Company’s personnel department no later than the close
of business on the last business day of the Offering Period.  The percentage of Base Compensation withheld
may also be changed from one Offering Period to another.

 

9.9                                 Exercise of Options.  On the Offering Termination Date the
Participating Employee may purchase the number of shares purchasable by his or
her accumulated payroll deductions, or, if less, the maximum number of shares
subject to the Option as provided in Section 9.1, provided that:

 

(a)                                  If
the total number of shares which all Optionees elect to purchase, together with
any shares already purchased under the Plan, exceeds the total number of shares
which may be purchased under the Plan pursuant to Section 6, the number of
shares which each Optionee is permitted to purchase shall be decreased pro rata based on the Participating Employee’s
accumulated payroll deductions in relation to all accumulated payroll
deductions otherwise to be applied to the purchase of shares as of that
Offering Termination Date.

 

(b)                                 If
the number of shares purchasable includes a fraction, such number shall be
adjusted to the next smaller whole number and the purchase price shall be
adjusted accordingly.

 

Accumulated payroll deductions not withdrawn prior to the Offering
Termination Date shall be automatically applied by the Company toward the
purchase of Option Shares or, to the extent in excess of the aggregate purchase
price of the shares then purchasable by the Participating Employee, refunded to
the Participating Employee, except that where such excess is less than the
purchase price for a single share of Stock on the Offering Termination Date,
such excess shall not be refunded but instead shall be carried over and applied
to the purchase of shares in the first following Offering Period (subject to
the possibility of withdrawal by the Participating Employee during such
Offering Period in accordance with the terms of the Plan).

 

9.10                           Delivery of Stock.  Except as provided below, within a reasonable
time after the Offering Termination Date, the Company shall deliver or cause to
be delivered to the Participating Employee a certificate or certificates for
the number of shares purchased by the Participating Employee.  A stock certificate representing the number
of Shares purchased will be issued in the participant’s name only, or if his or
her Membership Agreement so specifies, in the name of the employee and another
person of legal age as joint tenants with rights of survivorship.  If any law or applicable regulation of the
Securities and Exchange Commission or other body having jurisdiction in the
premises shall require that the Company or the Participating Employee take any
action in connection with the shares being purchased under the Option, delivery
of the certificate or certificates for such shares shall be postponed until the
necessary action shall have been completed, which action shall be taken by the
Company at its own expense, without unreasonable delay.  The Optionee shall have no rights as a
shareholder in respect of shares for which he or she has not

 

 

received a certificate.

 

9.11                           Return of Accumulated Payroll Deductions.  In the event that the Participating Employee
or the Beneficiary is entitled to the return of accumulated payroll deductions,
whether by reason of voluntary withdrawal, termination of employment,
Retirement, death, or in the event that accumulated payroll deductions exceed
the price of shares purchased, such amount shall be returned by the Company to
the Participating Employee or the Beneficiary, as the case may be, not later
than within a reasonable time following the Offering Termination Date
applicable to the Option Period in which such deductions were taken.  Accumulated payroll deductions held by the
Company shall not bear interest nor shall the Company be obligated to segregate
the same from any of its other assets.

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