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2000 Contract=

 

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AMENDED & RESTATED EMPLOYMENT AGREEMENT

     The parti= es to this Amended and Restated Employment Agreement (this “Agreement”= ;), dated as of March 14, 2005, are Artesyn Te= chnologies, Inc., a Florida corporation (the “Company”), and Joseph M. O’Donnell (the “Executive”). The Company and the Executive currently are parti= es to an Employment Agreement dated January 1, 2000 (the “Existing Employment Agreement”). The Executive is presently the President and Chief Executive Officer of the Company and the parties wish to provide for = the continued employment of the Executive in such positions, from and after the date of this Agreement (the “Effective Date”), subject to the t= erms provided herein. The parties intend that the Existing Employment Agreement = be updated by this Agreement to reflect the current employment terms and compensation arrangements between the Company and the Executive that have b= een adopted and approved by the Company’s Board of Directors (the “Board”) (or, as applicable, the Compensation and Stock Option Committee of the Board (the “Compensation Committee”)) consiste= nt with the Existing Employment Agreement and the Company’s practices and policies.

     According= ly, the parties, intending to be legally bound, agree that the Existing Employm= ent Agreement is amended and restated in its entirety as follows:

     1. <= u>Employment.

     1.1 Ge= neral. The Company hereby employs the Executive in the positions and capacities of President and Chief Executive Officer, and the Executive hereby accepts such employment, subject to the terms and conditions herein contained. In such capacities, the Executive agrees faithfully to perform (i) all duties delineated in the By-laws of the Company relating to his positions as President and Chief Executive Officer, (ii) such duties and responsibilities as are customary for an executive with similar titles and positions at similar publicly-traded companies and (iii) such addition= al duties (consistent with his positions as President and Chief Executive Offi= cer) as may reasonably be assigned to the Executive from time to time by the Boa= rd of Directors of the Company (the “Board”). The Executive shall report directly and regularly to the Board. The Executive shall from time to time during the Employment Term (as defined in Section 4 hereof), communicate and consult with such member(s) of the Board as is designated by the Board. Subject to the foregoing, the Executive shall not be required to report to or take direction from any particular individual.

     1.2 Bo= ards and Committees. The Company shall cause the Executive, during the Employment Term, to continue to be renominated = for election to the Board. The Executive will serve, if appointed, on any committee(s) of the Board, and on any board(s) of directors and/or committe= e(s) of any subsidiaries of the Company, all without further compensation. =

     1.3 Fu= ll-Time Position. The Executive hereby agrees that, during the Employment Term = he shall devote all of his business time, attention and skills to the business= and affairs of

the Company and its subsidiaries, except during vac= ation time as provided by Section 3.4 hereof and any periods of illness. The Executive agrees that, during the Employment Term, he will not seek employm= ent with another entity. Subject to the foregoing, nothing in this Agreement sh= all restrict the Executive from (i) managing h= is personal investments, personal business affairs and other personal matters, (ii) serving on the boards of directors of companies that do not compe= te directly or indirectly with the Company, (iii) serving on civic or charitable boards or committees or (iv) delivering lectures, fulfilling speaking engagements or teaching at educational institutions; provided that none of such activities, either singly or in the aggregate, interfere = with the performance of his duties under this Agreement. The Executive must rece= ive approval of the Board prior to assuming any other directorships. It is hereby acknowledged that the Executive has received the necessary approvals to ser= ve as a member of the Board of Directors of Parametric Technology Corporation.=

     2. <= u>Compensation.

     2.1 Sa= lary. Subject to the terms and conditions herein contained, during the Employment Term, the Company shall pay to the Executive, and the Executive shall accep= t, for all services to be rendered by him pursuant to this Agreement (includin= g, but not limited to, any services that may be rendered by him to any subsidi= ary of the Company and any services that may be rendered by him as a member of = the Board or the board of any such subsidiary or any committee(s) thereof) a ba= se salary of $560,000 per annum, and subject to increases, if any, as may be approved from time to time by the Board or the Compensation Committee in its discretion (such amount, together with any applicable increases, shall be referred to herein as the “Base Salary”). The Executive’s= Base Salary shall be payable in such installments as are in effect from time to = time in accordance with the regular payroll practices of the Company.

     2.2 In= centive Payment. In addition to his Base Salary, the Executive shall be entitle= d to receive an incentive payment in respect of each calendar year during the Employment Term (an “Incentive Payment”) as such may be awarded pursuant to, and in accordance with, the terms of the Company’s Execu= tive Incentive Plan, as then in effect. For purposes of this Agreement, a paymen= t of one hundred eighty-two percent (182%) of the Base Salary, or such higher percentage as may be approved from time to time by the Board or the Compensation Committee in its discretion, is hereinafter referred to as the “Maximum Incentive Payment.”

     2.3 Eq= uity Compensation. The Company agrees that the Executive shall, at the sole discretion of the Compensation Committee, be eligible for an annual grant of stock options or other award of equity compensation under the terms of any = stock incentive plan maintained by the Company, as then in effect.

     3. <= u>Additional Benefits.

     3.1 Ex= penses. The Company shall reimburse the Executive (upon the submission by him of reasonably itemized accounts therefor), or adva= nce to the Executive, where appropriate, an amount for such costs and expenses as = the Executive shall reasonably incur (including, among other things, business travel and business entertainment expenses) in connection with the

performance by him of his duties hereun= der in accordance with the Company’s policy with respect thereto as in effect from time to time during the Employment Term. In addition, the Executive sh= all be entitled to, and the Company shall provide, reimbursement of amounts pai= d by him for the annual planning and preparation of his tax returns in an amount reasonable and customary for executives of similar status.

     3.2 Ge= neral Fringe Benefits. The Executive shall be entitled to, and the Company sh= all provide, such fringe benefits of the Company, including, but not limited to, participation in employee health and benefit plans and the Company’s purchase of health and/or disability insurance, which the Company may from = time to time generally offer its senior executive officers during the Employment Term and for which the Executive is eligible. In addition, the Executive sh= all be entitled to, and the Company shall provide, an annual executive physical exam and participation in the medical executive reimbursement plan (MERP), = on a basis consistent with the terms, conditions and administration of such plan, and a non-accountable pre-tax car allowance of $900 per month, subject to increases, if any, as may be approved from time to time by the Board or the Compensation Committee in its discretion.

     3.2.1 = Life Insurance/Supplemental Retirement. In order to provide a supplemental retirement benefit for the Executive, the Company shall pay, as they become due, the premiums on the following two (2) whole life insurance polici= es on the life of the Executive, each policy having a face amount of $250,000:= (i) Northwestern Mutual Life Policy No. 12 7= 58 004 (whole life policy with adjustable term protection), which policy currently has, the Executive hereby represents, an annual premium of $14,705.00, and (ii) Northwestern Mutual Life Policy No. 11 882 114 (whole life policy paid-up at age 100), which policy currently has, the Executive hereby represents, an annual premium of $5,295.00. The quarterly premiums shall be timely paid by the Company upon submission of the quarterly premium payment vouchers therefor.

     3.2.2 = Other Insurance Matters. The Executive hereby agrees that the Company may continue, renew and/or purchase term or other insurance (whether group or individual) on his life pursuant to which the Company is or shall be, as the case may be, the beneficiary and further agrees to take all reasonable acti= ons, including undergoing a physical examination, requested by the Company in or= der to facilitate its continuing, renewing and/or obtaining such insurance.

     3.3 Em= ployee-Managed Time Off. The Executive shall be entitled to twenty-eight (28) days of employee-managed time off annually during the Employment Term. The Executive shall provide the Board with reasonable prior notice of his planned vacatio= n(s). To the extent under the Company’s Employee-Managed Time Off Plan the Executive has accrued carry-over h= ours, the Executive shall be entitled to such accrual, or the economic equivalent paid in a lump sum upon his termination for any reason, in an amount not to exceed 800 hours.

     3.4 Ot= her Benefits. Nothing in this Agreement shall prevent the Company from, or obligate the Company to, increase compensation (including without limitation any Base Salary or Incentive Payment), any other payments or any other bene= fits to the Executive, or from deciding to provide the Executive with any benefi= ts in addition to those provided for herein. Subject to the foregoing, the Compensation Committee, will review the Executive’s compensation annually.

     4. <= u>Term of Employment. The Executive’s employment hereunder shall commenc= e on the Effective Date and shall continue through December 31, 2005; pr= ovided, however, that commencing on December 31, 2005 and on each December 31 thereafter (each, a “Renewal Date”), the term = of the Executive’s employment hereunder shall automatically be extended = for one (1) additional year unless, not later than 60 days prior to a Rene= wal Date, the Executive or the Company shall have given written notice to the o= ther that he or it does not wish to extend this Agreement. The Executive’s employment under this Agreement shall be subject to earlier termination und= er Section 5.

     The perio= d of such employment is herein referred to as the “Employment Term”.= The scheduled expiration of the Employment Term shall not be deemed to be a termination of the Employment Term hereunder, except as provided in Section 5.6.5 hereof.

     5. <= u>Termination.

     5.1 De= ath. The Employment Term shall terminate automatically in the event of the Executive’s death during the Employment Term and upon such terminatio= n, the obligations, duties and liabilities of the Company to the Executive sha= ll solely be as set forth in Section 5.6.1 hereof.

     5.2 Di= sability. In the event of the Executive’s failure to perform his duties by reas= on of his becoming Disabled (as defined herein) during the Employment Term, the Company shall have the option to terminate the Employment Term, by giving written notice of such termination to the Executive, which notice shall spe= cify the effective date of termination. Upon such termination, the Executive sha= ll have no further duties hereunder (except as set forth in Section 7 her= eof) and the obligations, duties and liabilities of the Company to the Executive shall solely be as set forth in Section 5.6.1 hereof. For purposes of = this Agreement, the term “Disabled” shall mean the inability of the Executive, for medical reason(s) certified by a physician selected by the Company and reasonably satisfactory to the Executive, to substantially perf= orm his duties hereunder for an aggregate of at least 180 days during any period of 365 consecutive days.

     5.3 By= the Company for Cause. The Company may, at its option, terminate the Employ= ment Term, for any of the following reasons (each a “Cause”), upon f= ive (5) business days’ prior written notice to the Executive that a meeting of the Board will be held to consider such action, at which meeting= the Executive and his counsel shall be afforded an opportunity to be heard (a “Hearing”). Upon such termination, the Executive shall have no further duties hereunder (except as set forth in Section 7 hereof) and= the obligations, duties and liabilities of the Company to the Executive shall solely be as set forth in Section 5.6.2 hereof:

     5.3.1 = Violation of Law. If the Executive is convicted of a felony under Federal or state law, the Board may terminate the Employment Term by written notice to the Executive, which termination shall be effective, if not rescinded, immediat= ely after the date of the Hearing.

     5.3.2 = Failure to Perform. If, without the prior express written consent of the Board,= the Executive fails to perform, in any material respect, any of his duties or obligations under Sections 1.1, 1.2, 1.3, 7.2, 7.3 or 7.4 hereof (other than as a result of being Disabled as to which Section 5.2 hereof could apply), and if such failure continues for more than thirty (30) days a= fter a Hearing is held in respect thereof, then the Board may terminate the Employment Term immediately after said thirty (30) day period; prov= ided, however, that if such failure is incapable of being cured, in the go= od faith determination of the Board, the Employment Term shall terminate immediately after the date of the Hearing.

     The parti= es hereto acknowledge and agree that matters of the business judgment of the Executive or the economic performance of the Company or any segment thereof shall not be factors in determining Cause, except to the extent that they involve gross negligence or willful misconduct.

     5.3.3 = Other Actions. If, without the prior express written consent of the Board, the Executive takes actions or omits to take actions in connection with his dut= ies and/or responsibilities hereunder that constitute willful misconduct or gro= ss negligence and such actions or omissions adversely affect the business, reputation, or financial or other condition of the Company, the Board may terminate the Employment Term by written notice to the Executive, which termination shall be effective immediately after the date of the Hearing. <= o:p>

     The parti= es hereto acknowledge and agree that matters of the business judgment of the Executive or the economic performance of the Company or any segment thereof shall not be factors in determining Cause, except to the extent that they involve gross negligence or willful misconduct.

     5.4 By= the Company Without Cause. In addition (and with= out prejudice) to its right to terminate the Employment Term under the provisio= ns of Section 5.3 hereof, the Company may, at its option, terminate the Employment Term for any reason whatsoever by giving written notice of termination to the Executive from the Board, specifying the date of termination. Upon such termination, the Executive shall have no further dut= ies hereunder (except as set forth in Section 7 hereof) and the obligation= s, duties and liabilities of the Company to the Executive shall solely be as s= et forth in Section 5.6.3 hereof.

     5.5 By= the Executive For “Substantial Breach.R= 21; As used herein, “Substantial Breach” shall mean the Company’s material breach of this Agreement, including but not limited to, without the Executive’s consent, the assignment to the Executive of positions or duties materially inconsistent with the provisions of this Agreement, a material diminution of the Executive’s position, authority, responsibilities or benefits to which he is then entitled hereunder, any reduction of the compensation provided for in Section 2.1 and 2.2 here= of, the relocation of corporate headquarters further than a fifty mile radius f= rom the present headquarters, or the Company’s common stock no longer bei= ng publicly traded under The Nasdaq Stock Market o= r a national stock exchange. In the event that the Executive wishes to terminate the Employment Term due to a Substantial Breach by the Company, the Executi= ve shall send a written notice to the Company notifying the Company of the bre= ach within one hundred twenty (120) days of such

breach. If such breach is not corrected within thirty (30) days after receipt of such notice, then the Executive may, in his sole discretion, elect to terminate the Employment Term by giving written notice of such election to the Company, and upon receipt by the Company of = such an election, the Employment Term shall terminate. Upon such termination, the Executive shall have no further duties hereunder (except as set forth in Section 7 hereof) and the obligations, duties and liabilities of the Company to the Executive shall solely be as set forth in section 5.6.3 here= of.

     5.6 Pa= yments Upon Termination. In the event that the Empl= oyment Term is terminated hereunder, the Company shall pay to the Executive the following amounts and any amounts due under Section 3.3 hereof, and the Company shall thereupon have no liability or other obligation of any kind or character under or in connection with this Agreement (the effective date of= any such termination is hereinafter referred to as the “Termination Date”):

     5.6.1 = Death or Disability. In the event that the Employment Term is terminated purs= uant to Section 5.1 or Section 5.2 hereof, the Company shall pay to the Executive or to the Executive’s executor, administrator, beneficiary = or personal representative (the “Representative”), as the case may= be, the following:

     (ithe Base Salary du= e and owing through the Termination Date, payable in accordance with the Company’s regular payroll practices;

     (ii) = ;the Base Salary from the Termination Date through one year from the date thereo= f, payable in accordance with the Company’s then regular payroll practic= es; provided, however, that any Company-funded disability or life insurance or substantially similar disability or death benefits payable to the Executive= or to his Representative, as the case may be, (excluding life insurance provid= ed under Section 3.2.1 hereof) solely an account of such death or disabil= ity shall offset payments of Base Salary under this subsection (ii) if such insurance and/or benefit amounts are payable prior to the due date(s) of su= ch payment(s) hereunder; and further provided, that any life insurance proceeds shall not be utilized to offset any payments made to the Executive on accou= nt of any disability; and

     (iii)&nbs= p;the Maximum Incentive Payment.

     In additi= on, the Executive or his Representative, as the case may be, shall, to the exte= nt allowable under the law, COBRA limits or the provisions of the applicable p= lan, continue to receive during such twelve (12) month period following the Termination Date all benefits and service credits for benefits under medica= l, insurance and other employee benefit plans and programs described in Sections 3.2 and 3.4 hereof and to which he was entitled at the Termination Date (collectively, the “Benefits”).

     5.6.2 By the Company for Cause. In the event t= hat the Employment Term is terminated pursuant to Section 5.3 hereof, the Company shall pay to the Executive his Base Salary due and owing to him thr= ough the Termination Date payable in accordance with the Company’s regular= payroll practices.

     5.6.3 By the Company without Cause or By the Execu= tive for Substantial Breach. In the event that the Employment Term is termin= ated pursuant to Section 5.4 or Section 5.5 hereof, the Company shall = pay to the Executive (i) the balance of the Ba= se Salary and Maximum Incentive Payment due and owing through the Termination = Date payable in accordance with the Company’s regular payroll practices; (ii) an amount equal to two times the sum of the Base Salary and Maxim= um Incentive Payment, payable in twenty-four (24) equal monthly installme= nts after the Termination Date, in accordance with the Company’s then reg= ular payroll practices, provided, however, that the last twelve (12) payments shall not be paid by the Company if the Executive is fou= nd to be in breach of Section 7 hereof; and (iii) the costs and expense= s of outplacement related services which the Executive shall reasonably incur in= an amount not to exceed $45,000 (upon the submission by him of reasonably item= ized invoices therefor).

     In additi= on, the Executive shall continue to receive, to the extent allowable by law, the Benefits during the period set forth in clause (ii) above. To the exte= nt such Benefits under COBRA cannot be provided by law after a period of eight= een (18) months, the Company will reimburse the Executive an amount equiva= lent to the cost of such Benefits under COBRA to the Executive for the remaining= six (6) month period.

     5.6.4 = Effect of Change of Control.

     (a) = Payment Upon Termination.

     If a Chan= ge of Control (as hereinafter defined) occurs prior to a termination of the Employment Term, then in the event of the subsequent termination of the Employment Term pursuant to section 5.4 or Section 5.5 hereof, the Com= pany shall, in lieu of the amount otherwise payable under Section 5.6.3 her= eof, immediately upon the Termination Date, pay to the Executive a lump-sum paym= ent equal to (i) the sum of the Executive̵= 7;s Base Salary and the Maximum Incentive Payment multiplied by three (3), and (ii) the value of the Benefits to which the Executive would otherwise = be entitled if such Benefits were continued for a period of three (3) yea= rs after the Termination Date (which, if the Executive and the Company cannot agree on such value, shall be conclusively determined by Watson Wyatt & Company within fifteen (15) days of the Termination Date). Notwithstan= ding the foregoing, the Executive shall not be entitled to receive any payments under Section 5.6.4 hereof, in the event the Company sells its Power Conversion business but still continues to own at least fifty one (51%) per= cent interest in its Communications Products business.

     In order = for the Executive to become entitled to the payments pursuant to this subsection (a) as a result of a termination pursuant to Section 5.5 hereof, he sh= all be required to provide the notice referred to in such Section. <= /span>

     (b) = Change of Control Defined. A “Change of Control” shall be deemed to have occurred upon any of the following events:

     (i) The consummation of any of the following transactions: (A) a merger, recapitalization or other business combina= tion of the Company with or into another corporation, or an acquisition

of securities or assets by the Company, pursuant to which the Company is not the continuing or surviving corporatio= n or pursuant to which all or substantially all of the shares of the CompanyR= 17;s common stock are converted into cash, securities of another corporation or other property, other than a transaction in which the holders of the Company’s common stock immediately prior to such transaction (includi= ng any preliminary or other transactions relating to such transaction) shall continue to own at least 50% of the total voting power of the then-outstand= ing securities of the surviving or continuing corporation immediately after such transaction, (B) any sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all, or substantially a= ll, of the assets of the Company or (C) the liquidation or dissolution of = the Company, except in connection with the voluntary or involuntary declaration= of bankruptcy or insolvency under applicable Federal and/or state law;

     (ii) = ;A transaction in which any Person (as such term is used in Sections 13(d= )(3) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), corporation or other entity (other than the Company, an affiliate of the Company, or any profit-sharing, employee owner= ship or other employee benefit or similar plan sponsored by the Company or any of its subsidiaries, or any trustee of or fiduciary with respect to any such p= lan when acting in such capacity, or any group comprised solely of such entitie= s): (A) shall purchase common stock (or securities convertible into common stock) representing at least 40% of the total voting power of the then-outstanding securities of the Company for cash, securities or any other consideration pursuant to a tender offer or exchange offer, or (B) sha= ll become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly (in one transaction or a series of related transactions), of securities of the Comp= any representing 50% or more of the total voting power of the then-outstanding = securities of the Company ordinarily (and apart from the rights accruing under special circumstances) having the right to vote in the election of the Company̵= 7;s directors; or

     (iii)&nbs= p;If, during any period of two (2) consecutive years, individuals who at the= beginning of such period constituted the entire Board and any new director whose elec= tion by the Board or nomination for election by the Company’s stockholders= was approved by a vote of at least a majority of the directors then still in of= fice who either were directors at the beginning of the period or whose election = or nomination for election by the stockholders was previously so approved, cea= se for any reason to constitute a majority thereof.

     (c) = Certain Additional Payments by the Company.

     (i) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution to or for the benefit of the Executive (whether paid or payabl= e or distributed or distributable pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose act= ions result in a Change in Control or any Person affiliated with the Company or = such Person, but determined without regard to any additional payments required u= nder this Section 5.6.4(c) (a “Payment”)) would be subject to t= he excise tax imposed by Section 4999 of the Internal Revenue Code of 198= 6, as amended (the “Code”) or any interest or penalties are incurr= ed by the Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter

collectively referred to as the “= Excise Tax”), then the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after pay= ment by the Executive of all taxes (including any interest or penalties imposed = with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imp= osed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

     (ii) = ;Subject to the provisions of paragraph (ii) of this Section 5.6.4(c), all determinations required to be made under this Section 5.6.4(c), includ= ing whether and when a Gross-Up Payment is required and the amount of such Gros= s-up Payment and the assumptions to be utilized in arriving at such determinatio= n, shall be made by a nationally recognized certified public accounting firm d= esignated by the Executive (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Executive with= in fifteen (15) business days after receipt of notice from the Executive = that there has been a Payment, or such earlier time as is requested by the Compa= ny. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 5.6.4(c), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm’s determinat= ion. Any determination by the Accounting Firm shall be binding upon the Company = and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by t= he Accounting Firm hereunder, it is possible that Gross-Up Payments which will= not have been made by the Company should have been made (“Underpayment”) consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuan= t to paragraph (iii) of this Section 5.6.4(c) and the Executive therea= fter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of= the Executive.

     (iii)&nbs= p;The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Compa= ny of the Gross-Up Payment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executi= ve is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be pa= id. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which it gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such period that it desires to contest s= uch claim, the Executive shall:

(A) = give the Company any information reasonably requested = by the Company relating to such claim;

(B) = take such action in connection with contesting such cl= aim as the Company shall reasonably request in writing from time to time, includin= g, without limitation, accepting

legal representation with respect to such claim by an attorney reasonably selected by the Company;

(C) = cooperate with the Company in good faith in order effectively to contest such claim; and

(D) = permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and= pay directly all costs and expenses (including additional interest and penaltie= s) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result= of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this paragraph (iii) of Section 5.6.4= (c), the Company shall control all proceedings taken in connection with such con= test and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct the Execut= ive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs the Executive to pay such claim and sue for a refund, the Company shall advance= the amount of such payment to the Executive, on an interest-free basis and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect ther= eto) imposed with respect to such advance or with respect to any imputed income = with respect to such advance; and provided, further, that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, = the Company’s control of the contest shall be limited to issues with resp= ect to which a Gross-Up Payment would be payable hereunder and the Executive sh= all be entitled to settle or contest, as the case may be, any other issue raise= d by the Internal Revenue Service or any other taxing authority.

     (d) = If, after the receipt by the Executive of an amount advanced by the Company pursuant to paragraph (c) of this Section 5.6.4, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to the Company’s complying with the requirem= ents of paragraph (iii) of this Section 5.6.4(c) promptly pay to the Company the amount of such refund (together with interest paid or credited thereon after taxes applicable thereto). If after the receipt by the Execut= ive of an amount advanced by the Company pursuant to paragraph (iii) of th= is Section 5.6.4(c), a determination is made that the Executive shall not= be entitled to any to any refund with respect to such claim and the Company do= es not notify the Executive in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) days after such determination, then such advance shall be forgiven and shall not be require= d to be repaid and the amount of such advance shall offset, to the extent thereo= f, the amount of Gross-Up Payment required to be paid.

     5.6.5 = Non-Renewal By the Employer. If the Company shall give n= otice of non-renewal of the Employment Term in accordance with the provisions of Section 4 hereof, the Company shall pay to the Executive an amount equ= al to two times the sum of the Base Salary and the Maximum Incentive Payment, payable in twenty-four (24) equal monthly installments after the end of the Employment Term payable in accordance with the Company’s then reg= ular payroll practices.

     The parti= es hereto hereby agree that, for the purposes of this Section 5.6.5, the = Termination Date shall be the date upon which the Executive’s employment hereunde= r is scheduled to expire pursuant to Section 4 hereof, unless the parties hereto mutually agree to an earlier date.

     Upon the payment of the foregoing amount to the Executive, the Company shall have no liability or other obligation of any kind or character under or in connecti= on with this Agreement, except with respect to Section 7 hereof.

     Following= the Executive’s attainment of the age of 65 years, all obligations a= nd liabilities of the Company under this Section 5.6.5 in respect of its decision not to renew the Executive shall forthwith terminate. <= /span>

     6. <= u>Arbitration.

     6.1 Ge= neral. Any dispute under this Agreement arising out of or relating to Section = ;5 hereof shall be settled by arbitration in accordance with this Section = ;6.

     6.2 Co= mmencement. Either party may serve upon the other party written notice that the dispute, specifying the nature thereof, shall be submitted to arbitration. Within ten (10) days after the service of such notice, each of the parties shall designate a person as an arbitrator and serve written notice of such appointment upon the other party. If either party fails within the specified time to appoint such arbitrator, the other party (if such party shall timely designate an arbitrator) shall be entitled to appoint both arbitrators. The= two arbitrators so appointed shall appoint a third arbitrator. If the two arbitrators appointed shall fail to agree upon a third arbitrator within te= n (l0) days after their appointment, then an application may be made by either par= ty hereto, upon written notice to the other party, to the American Arbitration Association, or any successor thereto, or if the American Arbitration Association or its successor shall fail to appoint a third arbitrator within ten (10) days after such request, then either party may apply, with written notice to the other, to any court of competent jurisdiction for the appointment of a third arbitrator, and any such appointment so made shall be binding upon both parties hereto.

     6.3 Ap= plicable Rules and Procedures. The arbitration shall be conducted, to the extent consistent with this Section 6, in accordance with the then prevailing rules and procedures of the American Arbitration Association or its success= or. The arbitrators shall have the right to retain and consult experts and competent authorities skilled in the matters under arbitration, but all consultations shall be made in the presence of both parties, who shall have= full right to cross-examine the experts and authorities. Unless otherwise agreed= by the parties, any such arbitration

shall= take place in Boca Raton, Florida,= and shall be conducted in accordance with the Commercial Arbitration Rules of t= he American Arbitration Association.

     6.4 De= cision. The arbitrators shall render their award, upon the concurrence of at least = two of their number, not later than thirty (30) days after the appointment= of the third arbitrator. Their decision and award shall be in writing, and counterpart copies shall be delivered to each of the parties. Such decision= of the arbitrators shall be final and binding upon the parties hereto. In rendering their award, the arbitrators shall have no power to modify any of= the provisions of this Agreement, and the jurisdiction and power of the arbitra= tors are expressly limited accordingly. Judgment may be entered on the award of = the arbitrators and may be enforced in any court having jurisdiction.

     Each of t= he parties hereto shall bear all of its/his own fees, costs and expenses, including attorneys’ fees, incurred by it in connection with any arbitration proceeding pursuant to this Section 6. Notwithstanding the foregoing, in the event any party fails to comply with the decision of the = arbitrators and the other party undertakes any action(s) or proceeding(s) to enforce su= ch compliance, all costs and expenses (including reasonable legal fees) incurr= ed by the party seeking to enforce such compliance shall be borne by the party failing to so comply.

     7. <= u>Non-disclosure; Non-compete; Availability.

     7.1 &#= 8220;Confidential Information” Defined. “Confidential Information” shall mean any and all information (verbal and written) of the Company or any of = its subsidiaries or with respect to any of their activities including, but not limited to, information relating to the Company’s technology; researc= h; test procedures and results; manufacturing machinery and equipment; manufacturing processes; financial information; products; identity of raw m= aterials and services used; purchasing; trade secrets; costs; pricing; engineering; customers and prospects; marketing; and selling and servicing; provided<= /u>, that Confidential Information shall not include information of a general, non-proprietary nature generally known in the industry and Company specific information that in such form is or becomes publicly available other than through improper means in which the Executive participated or of which he h= as knowledge.

     7.2 No= n-Disclosure of Confidential Information. The Executive hereby agrees that he shall = not, at any time during the Employment Term (other than as may be required in connection with the performance by him of his duties hereunder) or thereaft= er, directly or indirectly, use, communicate, disclose or disseminate any Confidential Information in any manner whatsoever (except as may be required under legal process by subpoena or other court order), without the prior written consent of the Company.

     7.3 No= n-compete Covenant. The Executive hereby agrees that he shall not, during the Employment Term and for a period of twelve (12) months after the Termination Date (as long as he is entitled to and duly receives any paymen= ts due to him pursuant to Section 5.6.3 hereof), directly or indirectly engage in any business (whether as owner, manager, operator, lender, partne= r, stockholder, licensor, licensee, joint venturer, employee, consultant or otherwise) in which the Company or any of its subsidiaries, as of the Termination Date, is engaged as a

significant portion of its business (it= is hereby agreed that (i) any business that constitutes at least twenty (20%) percent of the Company’s prior fisc= al year’s revenues and (ii) the Company’s Power Conversion and Communications Products business areas shall automatically be deemed “significant” hereunder) in any geographic area in which the Company or any of its subsidiaries then is so engaged. Notwithstanding the foregoing, the Executive shall be permitted to own (as a passive investment) not more than two (2%) percent of the economic interests of a person or ent= ity; provided, however, that said two (2%) percent limitation shall apply to the aggregate holdings of the Executive and those of all other per= sons and entities with whom the Executive has agreed to act for the purpose of acquiring, holding, voting or disposing of such securities, except pursuant= to a bona fide operating agreement in respect of such person or entity, such a= s a stockholders’ agreement or partnership agreement. In the event of a t= ermination of the Employment Term as a result of a change in a “Change of Control”, the non-compete covenant contained in this paragraph shall = not apply to the Executive.

     7.4 Ce= rtain Activities. For purposes of clarification, but not of limitation, the Executive hereby acknowledges and agrees that, in addition to the provision= s of Section 7.3 above, he shall not, during the period referred to therein, directly or indirectly, hire, offer to hire, entice away or in any other ma= nner persuade or attempt to persuade any officer, employee, agent, lessor, lessee, licensor, licensee, customer (includi= ng those that are being actively solicited to become customers), creditor or supplier (each, a “Solicited Person”) of the Company or any of = its subsidiaries to discontinue or adversely alter his or its relationship with= the Company or any of its subsidiaries so that such person can start or develop= a relationship with any other person in which the Executive has an interest as referred to in Section 7.3 hereof. For purposes of this Section 7= .4, a Solicited Person shall be deemed to include any person or entity who was = an officer, employee, agent, lessor, lessee, licen= sor, licensee, customer, prospective customer, creditor or supplier at any time during the six-month period prior to the termination of the Employment Term= .

     7.5 In= junctive Relief, etc. The parties hereto hereby acknowledge and agree that (i) the Company would be irreparably injured in the ev= ent of a breach by the Executive of any of his obligations under this Section = ;7; (ii) monetary damages would not be an adequate remedy for any such bre= ach; and (iii) the Company shall be entitled to injunctive relief, in addit= ion to any other remedies that it may have, in the event of any such breach. It= is hereby also agreed that the existence of any claims that the Executive may = have against the Company or any of its subsidiaries, whether under this Agreemen= t or otherwise, shall not be a defense to the enforcement by the Company of any = of its rights under this Section 7.

     If the Co= mpany shall commence an injunctive action against the Executive in a court of competent jurisdiction, the Executive may commence an action in such court,= in lieu of the arbitration of claims under Section 6 hereof, and upon the Executive’s commencement of such action, the provisions of Section&nb= sp;6 hereof shall be null and void and of no further effect. <= /p>

     7.6 Sc= ope of Restrictions. It is the intent of the parties hereto that the covenants= and restrictions contained in this Section 7 shall be enforced to the full= est extent permissible under the laws and public policies of each jurisdiction = in which enforcement is sought. The Executive

hereby acknowledges that said restrictions are reasona= bly necessary for the protection of the Company. Accordingly, it is hereby agre= ed that if any provision of this Section 7 shall be adjudicated to be inv= alid or unenforceable for any reason whatsoever, said provision shall be (only w= ith respect to the operation thereof in the particular jurisdiction in which su= ch adjudication is made) construed by limiting and reducing it so as to be enforceable to the fullest extent permissible, without invalidating or limi= ting the remaining provisions of this Agreement or affecting the validity or enforceability of said provision in any other jurisdiction.

     7.7 No= n-exclusivity. The undertakings and obligations of the Executive contained in this Section 7 shall be in addition to, and not in lieu of, any obligations which he may have with respect to the subject matter hereof, whether by contract, as a matter of law or otherwise.

     7.8 Av= ailability. Reasonably subject to his employment commitments elsewhere, the Executive hereby agrees to make himself available to the Company after the terminatio= n of the Employment Term, at such reasonable time or times as may be required by= the Company in connection with any pending or threatened litigation or governme= ntal investigation involving the Company, not to exceed five (5) days in any calendar quarter unless otherwise mutually agreed. The Company shall advanc= e or reimburse the Executive for any out-of-pocket expenses reasonably incurred = by him in fulfilling his obligations under this Section 7.8 upon the submission by him of reasonably itemized accounts ther= efor, and shall pay the Executive a mutually agreed upon per diem fee for any day= s in excess of two (2) hereunder, including reasonable preparation time.

     7.9 Su= rvival of Provisions of Section 7. It is understood and agreed that the provisions of this Section 7 shall survive the date of termination or expiration of the Employment Term.

     8. <= u>Miscellaneous Provisions.

     8.1 Wi= thholding. All payments required to be made to the Executive by the Company hereunder shall be subject to any applicable withholding under applicable Federal, st= ate and local income tax laws. Any such withholding shall be based upon the most recent Form W-4 filed by the Executive with the Company, and the Executive = may from time to time revise such filing.

     8.2 Se= verability. If in any jurisdiction any term or provision hereof is adjudicated to be invalid or unenforceable, (i) the remaining terms and provisions hereof shall be unimpaired, (ii) any such invalid= ity or unenforceability in any jurisdiction shall not invalidate, limit or rend= er unenforceable such provision in any other jurisdiction and (iii) the invalid or unenforceable term or provision shall, for purposes of such jurisdiction, be deemed replaced by a term or provision that is valid and e= nforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision.

     8.3 In= demnification. The Company shall indemnify the Executive to the fullest extent permitted by applicable law for all amounts (including without limitation, judgments, fi= nes, settlement payments, costs, expenses and attorneys’ fees and expenses) reasonably incurred or paid by the Executive in connection with any claim, action, suit, investigation or proceeding

arising out of or relating to performan= ce by the Executive of services for, or actions of the Executive as (or the Executive’s serving in the position of) a director, officer or employ= ee of, the Company, any subsidiary or affiliate of the Company or any enterpri= se at the Company’s request, and shall advance to the Executive (subject= to the Executive’s undertaking to repay any advances if it is determined that he is not entitled to them) the reasonable costs, including attorneys’ fees, of defending any such notion. The provisions of this Section 8.3 shall survive the termination of this Agreement.

     8.4 Ex= ecution in Counterparts. This Agreement may be executed in one or more counterparts, and by each of the parties hereto in separate counterparts, e= ach of which shall be deemed to be an original but all of which taken together shall constitute one and the same agreement, and this Agreement shall become effective when one or more counterparts has been signed by each of the part= ies hereto and delivered to the other party hereto.

     8.5 No= tices. All notices, requests, demands and other communications hereunder shall be = in writing and shall be deemed duly given when delivered by hand, or when delivered if mailed by registered or certified mail or private courier serv= ice, postage prepaid, to the respective addresses as follows: =

     If to the Company, to:

&n= bsp;

&n= bsp;

 &= nbsp;         

Artesyn Technologies, Inc.
7900 Glades RoadSuite 500
Boca Raton, FL 33434
Attn: Vice President — Chief Financial Officer

     If to the Executive, to:

&n= bsp;

&n= bsp;

 &= nbsp;         

Joseph M. O’Donnell
3681 C= arlton PlaceM
Boca Raton, Florida 33496

or to such other address(es) as either party hereto shall have designated by like notice to the other Pa= rty hereto.

     8.6 Am= endment. No provision of this Agreement may be modified, amended or discharged in any manner, except by a written instrument executed by each of the parties here= to.

     8.7 En= tire Agreement. This Agreement constitutes the entire agreement of the parti= es hereto with respect to the subject matter hereof, and supersedes all prior agreements and understandings of the parties hereto, oral and written, including all prior or existing employment agreements. Each party hereby acknowledges and agrees that, other than as contained herein, no other representations or warranties, oral or written, have been made, expressly or impliedly, by the other party hereto.

     8.8 Ap= plicable Law. This Agreement shall be governed by the laws of the State of Florida applicab= le to contracts made and to be wholly performed therein.

     8.9 He= adings. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.

     8.10 N= on-assignability.

     8.10.1 By the Executive. Neither this Agreement= nor any right, duty, obligation or interest hereunder shall be assignable or delegable by the Executive without the Company’s prior written consen= t; however, that the Executive may designate any of his beneficiaries to recei= ve (and such beneficiaries shall receive) any compensation, payments or other benefits payable hereunder upon or after his death, or the foregoing may be transferred by the laws of descent or distribution.

     8.10.2 By the Company. This Agreement and all o= f the Company’s rights and obligations hereunder may be assigned or transfe= rred by it through a merger, consolidation or other business combination, includ= ing a Change of Control. Upon the occurrence of such a transaction any such successor company resulting therefrom shall be = deemed to be substituted for all purposes as the Company hereunder.

     8.11 B= inding Effect; Benefits. This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and their respective heirs, legal representatives, successors and permitted assigns.

     8.12 W= aiver. The failure of either of the parties hereto at any time to enforce any provision of this Agreement shall not be deemed or construed to be a waiver= of any such or any other provision, nor to in any way affect the validity of t= his Agreement or any provision hereof or the right of either of the parties her= eto to thereafter enforce each and every provision of this Agreement. No waiver= of any breach of any of the provisions of this Agreement shall be effective un= less set forth in a written instrument executed by the party against whom or whi= ch enforcement of such waiver is sought, and no waiver of any such breach shal= l be construed or deemed to be a waiver of any other or subsequent breach. =

     8.13 C= apacity, etc. The Executive hereby represents and warrants to the Company and the Company hereby represents and warrants to the Executive that: (i) he (or it) has full power, authority and capa= city to execute and deliver this Agreement, and to perform his (or its) obligati= ons hereunder, (ii) said execution, delivery and performance will not (and with the giving of notice or lapse of time, or both, would not) result in t= he breach of any agreement or other obligation to which he (or it) is a party = or is otherwise bound and (iii) this Agreement is his (or its) valid and binding obligation enforceable in accordance with its terms.

     IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties here= to as of the date first above written.

 

 

 

 

 

 

ARTESYN TECHNOLOGIE= S, INC.
 

 

 

By:  

/s/ Richard J. Thompson  =

 

 

 

Vice President-Fina= nce, Chief Financial Officer, and Secretary 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

/s/ Joseph M. O’Donnell  

 

 

Joseph M. O’Donnell 

 

 

 

 

 

AGREED AND= ACCEPTED:

/s/ Phillip A. O’Reilly


Phillip A. O’Reilly
Chairman – Compensation Committee

17

        =             &nb= sp;            =             &nb= sp;         

 

 

        =    EXHIBIT 10.1

 

        =             &nb= sp;         EMPLOYMENT AGREEMENT

 

         AGREEMENT (the "Agreement"), dated as of this 1st day of January 2000,

by and between ARTESYN TECHNOLOGIES, INC., a Florida= corporation (the

"Company"), and JOSEPH M. O'DONNELL ("Executive").

 

         WHEREAS, the Company wishes to employ Executive as its President and=

Chief Executive Officer, and Executive wishes to be em= ployed by the Company in

such positions; and

 

         WHEREAS, the Board of Directors of the Company has authorized the

execution of this Agreement= .

 

         NOW, THEREFORE, in consideration of the mutual covenants and agreements

herein contained, the parti= es hereto hereby agree as follows:

 

         1.     &nb= sp; Employment.

        =           ----------

 

         1. 1 General. The Company hereby employs Executive in the positions = and

capacities of President and= Chief Executive Officer, and Executive hereby

accepts such employment, su= bject to the terms and conditions herein contained.

In such capacities, Executive agrees faithfully to per= form (i) all duties

delineated in the By-laws o= f the Company relating to his positions as President

and Chief Executive Officer= , (ii) such duties and responsibilities as are

customary for an executive = with similar titles and positions at similar

publicly-traded companies a= nd (iii) such additional duties (consistent with his

positions as President and = Chief Executive Officer ) as may reasonably be

assigned to Executive from = time to time by the Board of Directors of the Company

(the "Board"). Ex= ecutive shall. report directly and regularly to the Boar= d.

Executive shall from time to time during the Employmen= t Term (as defined in

Section 4 hereof), communicate and consult with such member(s) of the Board as

is designated by the Board.= Subject to the foregoing, Executive shall not be

required to report to or ta= ke direction from any particular individual.

 

         1.2 Boards and Committees. The Company shall cause Executive, during=

the Employment Term, to con= tinue to be renominated for election to the Board.<= /o:p>

Executive will serve, if appointed, on any committee(s= ) of the Board, and on any

board(s) of directors and/or committee(s) of any subsidiaries of the Company,

all without further compens= ation.

 

         1.3 Full-Time Position. Executive hereby agrees that, during the

Employment Term he shall devote all of his business ti= me, attention and skills

to the business and affairs= of the Company and its subsidiaries, except during

vacation time as provided by Section 3.4 hereof and any periods of illness.

Executive hereof agrees that, during the Employment Te= rm, he will not seek

employment with another ent= ity. Subject to the foregoing, nothing in this

Agreement shall restrict Executive from (i) managing his personal investments,

personal business affairs a= nd other personal matters, (ii) serving on the boards

of directors of companies t= hat do not compete directly or indirectly with the

Company, (iii) serving on civic or charitable boards or committees or (iv)

 

<PAGE>

 

delivering lectures, fulfil= ling speaking engagements or teaching at educational

institutions; provided that= none of such activities interfere with the

performance of his duties u= nder this Agreement. Executive must receive approval

of the Board prior to assum= ing any other directorships.

 

         2.     &nb= sp; Compensation.

        =           -------------

 

         2.1 Salary. Subject to the terms and conditions herein contained, th= e

Company shall, effective February 1, 2000, pay to Executive, and Executive shall

accept, for all services to= be rendered by him pursuant to this Agreement

(including, but not limited= to, any services that may be rendered by him to any

subsidiary of the Company a= nd any services that may be rendered by him as a

member of the Board or the = board of any such subsidiary or any committee(s)

thereof) a base salary of $= 522,000 per annum (the "Base Salary"), payable in

such installments as are in= effect from time to time in accordance with the

regular payroll practices o= f the Company.

 

         2.2 Incentive Payment. In addition to his Base Salary, Executive sha= ll

be entitled to receive an i= ncentive payment in respect of each calendar year

during the Employment Term = (an "Incentive Payment") as such may be awarded

pursuant to, and in accorda= nce with, the terms of the Company's Executive

Incentive Plan, as then in effect. For purposes of this Agreement, a payment of

one-hundred seventy (170%) = percent of the Base Salary is hereinafter referred to

as the "Maximum Incent= ive Payment."

 

         2.3 Stock Options. The Company hereby agrees that the Executive will= ,

at the sole discretion of t= he Compensation and Stock Option Committee, be

eligible for an annual gran= t of stock options under the terms of any stock

option plan, as then in eff= ect, at a price not less than 100% of the fair market

value of the Common Stock o= n the date of grant.

 

         3.     &nb= sp; Additional Benefits.

        =           -------------------

 

         3.1 Expenses. The Company shall reimburse Executive (upon the

submission by him of reason= ably itemized accounts therefor), or advance to=

Executive, where appropriate, an amount for such costs= and expenses as Executive

shall reasonably incur (inc= luding, among other things, business travel and

business entertainment expe= nses) in connection with the performance by him of

his duties hereunder in acc= ordance with the Company's policy with respect

thereto as in effect from t= ime to time during the Employment Term. In addition,

the Executive shall be enti= tled to, and the Company shall provide, a

non-accountable pre-tax car allowance of $900 per month and reimbursement of

amounts paid by him for the= annual planning and preparation of his tax returns

in an amount reasonable and customary for executives of similar status.

 

         3.2 General Fringe Benefits. Executive shall be entitled to, and the=

Company shall provide, such fringe benefits of the Com= pany, including, but not

limited to, participation in employee health and benefit plans and the Company's

purchase of health and/or disability insurance, which the Company may from time

to time generally offer its= senior executive officers during the Employment Term

and for which the Executive= is eligible. In addition, the Executive shall be

entitled to, and the Compan= y shall provide, an annual executive physical exam

 

        =             &nb= sp;            =        2

 

<PAGE>

 

and participation in the me= dical executive reimbursement plan (MERP), on a basis

consistent with the terms, conditions and administration of such plan.

 

         3.2.1 Life Insurance/Supplemental Retirement. In order to provide a<= o:p>

supplemental retirement ben= efit for Executive, the Company shall pay, as they

become due, the premiums on= the following two (2) whole life insurance policies

on the life of Executive, e= ach policy having a face amount of $250,000: (i)

Northwestern Mutual Life Policy No. 12 758 004 (whole = life policy with

adjustable term protection)= , which policy currently has, Executive hereby

represents, an annual premi= um of $14,705.00, and (ii) Northwestern Mutual Life

Policy No. 11 882 114 (whole life policy paid-up at age 100), which policy

currently has, Executive he= reby represents, an annual premium of $5,295.00. The

quarterly premiums shall be= timely paid by the Company upon submission of the

quarterly premium payment v= ouchers therefor.

 

         3.2.2 Other Insurance Matters. Executive hereby agrees that the Comp= any

may continue, renew and/or = purchase term or other insurance (whether group or

individual) on his life pur= suant to which the Company is or shall be, as the

case may be, the beneficiar= y and further agrees to take all reasonable actions,

including undergoing a phys= ical examination, requested by the Company in order

to facilitate its continuin= g, renewing and/or obtaining such insurance.

 

         3.3 Employee-Managed Time Off. Executive shall be entitled to

twenty-three (23) days of employee-managed time off annually during the

Employment Term. Executive = shall provide the Board with reasonable prior notice

of his planned vacation(s).= To the extent under the Company's Employee-Managed

Time Off Plan the Executive= has accrued carry-over hours, the Executive agrees

he will only be entitled to= such accrual, or the economic equivalent, in the

event of a Change of Contro= l (as defined in Section 5.6.4 hereof) and only in an

amount not to exceed 500 ho= urs.

 

         3.4 Other Benefits. Nothing in this Agreement shall prevent the Comp= any

from, or obligate the Compa= ny to, increase compensation (including without

limitation any Base Salary = or Incentive Payment), any other payments or any

other benefits to Executive= , or from deciding to provide Executive with any

benefits in addition to tho= se provided for herein. Subject to the foregoing, the

Compensation Committee, will review the Executive's compensation annually.

 

         4. Term of Employment. Executive's employment hereunder shall commen= ce

on January 1, 2000 and, subject to the provisions of Section 5 hereof, shall

continue through December 31, 2000; provided, however, that commencing on

December 31, 2000 and on each December 31 thereafter (each, a "Renewal Date"),

the term of Executive's emp= loyment hereunder shall automatically be extended for

one (1) additional year unl= ess, not later than 60 days prior to a Renewal Date,

Executive or the Company shall have given written noti= ce to the other that he or

it does not wish to extend = this Agreement.

 

         The period of such employment is herein referred to as the "Employment

Term". The scheduled expiration of the Employment Term shall not be deemed to be

a termination of the Employ= ment Term hereunder, except as provided in Section

5.6.5 hereof.

 

        =             &nb= sp;            =        3

 

<PAGE>

 

         5.     &nb= sp; Termination.

        =           -----------

 

         5.1 Death. The Employment Term shall terminate automatically in the<= o:p>

event of Executive's death = during the Employment Term and upon such termination,

the obligations, duties and= liabilities of the Company to Executive shall solely

be as set forth in Section = 5.6.1 hereof.

 

         5.2 Disability. In the event of Executive's failure to perform his

duties by reason of his bec= oming Disabled (as defined herein) during the

Employment Term, the Company shall have the option to terminate the Employment

Term, by giving written notice of such termination to Executive, which notice

shall specify the effective= date of termination. Upon such termination,

Executive shall have no further duties hereunder (exce= pt as set forth in Section

7 hereof) and the obligations, duties and liabilities = of the Company to

Executive shall solely be as set forth in Section 5.6.1 hereof. For purposes of

this Agreement, the term "Disabled" shall mean the inability of Executive, for<= /p>

medical reason(s) certified= by a physician selected by the Company and

reasonably satisfactory to Executive, to substantially perform his duties

hereunder for an aggregate = of at least 180 days during any period of 365

consecutive days.

 

         5.3 By the Company for Cause. The Company may, at its option, termin= ate

the Employment Term, for an= y of the following reasons (each a "Cause"), upon

five (5) business days' pri= or written notice to Executive that a meeting of the

Board will be held to consider such action, at which m= eeting Executive and his

counsel shall be afforded an opportunity to be heard (a "Hearing"). Upon such

termination, Executive shal= l have no further duties hereunder (except as set

forth in Section 7 hereof) = and the obligations, duties and liabilities of the

Company to Executive shall solely be as set forth in S= ection 5.6.2 hereof:

 

         5.3.1 Violation of Law. If Executive is convicted of a felony under<= o:p>

Federal or state law, the Board may terminate the Empl= oyment Term by written

notice to Executive, which termination shall be effective, if not rescinded,

immediately after the date = of the Hearing.

 

         5.3.2 Failure to Perform. If, without the prior express written cons= ent

of the Board, Executive fai= ls to perform, in any material respect, any of his

duties or obligations under Sections 1.1, 1.2, 1.3, 7.2, 7.3 or 7.4 hereof

(other than as a result of = being Disabled as to which Section 5.2 hereof could

apply), and if such failure continues for more than thirty (30) days after a

Hearing is held in respect thereof, then the Board may terminate the Employment

Term immediately after said thirty (30) day period; provided, however, that if

such failure is incapable o= f being cured, in the good faith determination of the

Board, the Employment Term shall terminate immediately= after the date of the

Hearing.

 

         The parties hereto acknowledge and agree that matters of the busines= s

judgment of Executive or the economic performance of the Company or any segment

thereof shall not be factor= s in determining Cause, except to the extent that

they involve gross negligen= ce or willful misconduct.

 

        =             &nb= sp;            =        4

 

<PAGE>

 

         5.3.3 Other Actions. If, without the prior express written consent o= f

the Board, Executive takes = actions or omits to take actions in connection with

his duties and/or responsib= ilities hereunder that constitute willful misconduct

or gross negligence and such actions or omissions adversely affect the business,

reputation, or financial or= other condition of the Company, the Board may

terminate the Employment Te= rm by written notice to Executive, which termination

shall be effective immediat= ely after the date of the Hearing.

 

         The parties hereto acknowledge and agree that matters of the busines= s

judgment of Executive or the economic performance of the Company or any segment

thereof shall not be factor= s in determining Cause, except to the extent that

they involve gross negligen= ce or willful misconduct.

 

         5.4 By the Company Without Cause. In addi= tion (and without prejudice)

to its right to terminate t= he Employment Term under the provisions of Section

5.3 hereof, the Company may= , at its option, terminate the Employment Term for

any reason whatsoever by gi= ving written notice of termination to Executive from

the Board, specifying the, = date of termination. Upon such termination, Executive

shall have no further duties hereunder (except as set forth in Section 7 hereof)

and the obligations, duties= and liabilities of the Company to Executive shall

solely be as set forth in S= ection 5.6.3 hereof.

 

         5.5 By Executive For Cause. As used herei= n, "Substantial Breach" shall

mean the Company's material= breach of this Agreement, including but not limited

to, without Executive's con= sent, the assignment to Executive of positions or

duties materially inconsist= ent with the provisions of this Agreement, a material

diminution of Executive's p= osition, authority, responsibilities or benefits to

which he is then entitled hereunder, any reduction of the compensation provided

for in Section 2.1 and 2.2 = hereof, the relocation of corporate headquarters

further than a fifty mile r= adius from the present headquarters, or the Company's

common stock no longer being publicly traded under The Nasdaq Stock Market o= r a

national stock exchange. In= the event of a Substantial Breach by the Company,

Executive may send a written notice to the Company not= ifying the Company of the

breach within one hundred t= wenty (120) days of such breach. If such breach is

not corrected within thirty= (30) days after receipt of such notice, then

Executive may, in his sole discretion, elect to termin= ate the Employment Term by

giving written notice of su= ch election to the Company, and upon receipt by the

Company of such an election, the Employment Term shall terminate. Upon such

termination, Executive shal= l have no further duties hereunder (except as set

forth in Section 7 hereof) = and the obligations, duties and liabilities of the

Company to Executive shall solely be as set forth in s= ection 5.6.3 hereof.

 

         5.6 Payments Upon Termination. In the eve= nt that the Employment Term is

terminated hereunder, the C= ompany shall pay to Executive the following amounts,

and the Company shall there= upon have no liability or other obligation of any

kind or character under or = in connection with this Agreement (the effective date

of any such termination is hereinafter referred to as the "Termination Date"):

 

        =             &nb= sp;            =        5

 

<PAGE>

 

         5.6.1 Death or Disability. In the event that the Employment Term is<= o:p>

terminated pursuant to Sect= ion 5.1 or Section 5.2 hereof, the Company shall pay

to Executive or to Executiv= e's executor, administrator, beneficiary or personal

representative (the "Representative"), as the case may be, the following:<= /p>

 

         (i) the Base = Salary due and owing through the Termination Date, payable

in accordance with the Comp= any's regular payroll practices;

 

         (ii) the Base Salary from the Termination= Date through one year from

the date thereof, payable in accordance with the Company's then regular payroll

practices; provided, howeve= r, that any Company-funded disability or life

insurance or substantially = similar disability or death benefits payable to

Executive or to his Representative, as the case may be, (excluding life

insurance provided under Se= ction 3.2.1 hereof) solely an account of such death

or disability shall offset = payments of Base Salary under this subsection (ii) if

such insurance and/or benef= it amounts are payable prior to the due date(s) of

such payment(s) hereunder; = and further provided, that any life insurance

proceeds shall not be utili= zed to offset any payments made to the Executive on

account of any disability; = and

 

         (iii) the Maximum Incentive Payment.=

 

         In addition, Executive or his Representative, as the case may be,

shall, to the extent allowa= ble under the law, COBRA limits or the provisions of

the applicable plan, contin= ue to receive during such twelve (12) month period

following the Termination D= ate all benefits and service credits for benefits

under medical, insurance an= d other employee benefit plans and programs described

in Sections 3.2 and 3.5 her= eof and to which he was entitled at the Termination

Date (collectively, the "Benefits").

 

        5.6.2 By the Company for Cause. In the ev= ent that the Employment Term is

terminated pursuant to Sect= ion 5.3 hereof, the Company shall pay to Executive

his Base Salary due and owi= ng to him through the Termination Date payable in

accordance with the Company= 's regular payroll practices.

 

        5.6.3 By the Company without Cause or By Executive for Cause. In the

event that the Employment T= erm is terminated pursuant to Section 5.4 or Section

5.5 hereof, the Company sha= ll pay to Executive (i) the balance of the Base

Salary and Maximum Incentive Payment due and owing thr= ough the Termination Date

payable in accordance with = the Company's regular payroll practices; (ii) an

amount equal to two times t= he sum of the Base Salary and Maximum Incentive

Payment, payable in twenty-four (24) equal monthly installments after the

Termination Date, in accordance with the Company's then regular payroll

practices, provided, howeve= r, that the last twelve (12) payments shall not be

paid by the Company if the Executive is found to be in breach of Section 7

hereof; and (iii) the costs= and expenses of outplacement related services which

Executive shall reasonably incur in an amount not to e= xceed $45,000 (upon the

submission by him or reason= ably itemized invoices therefore).

 

        =             &nb= sp;            =        6

 

<PAGE>

 

         In addition, Executive shall continue to receive, to the extent=

allowable by law, the Benef= its during the period set forth in clause (ii) above.

To the extent such Benefits under COBRA cannot be prov= ided by law after a period

of eighteen (18) months, the Company will reimburse the Executive an amount

equivalent to the cost of s= uch Benefits under COBRA to the Executive for the

remaining six (6) month per= iod.

 

         5.6.4    Effe= ct of Change of Control.

        =           ---------------------------

 

         (a)      Payment Upon Termination.

        =           ------------------------

 

         If a Change of Control (as hereinafter defined) occurs prior to a

termination of the Employme= nt Term, then in the event of the subsequent

termination of the Employme= nt Term pursuant to section 5.4 or Section 5.5

hereof, the Company shall, = in lieu of the amount otherwise payable under Section

5.6.3 hereof: (i) within ten (10) days after the Termination Date, pay to

Executive a lump-sum payment equal to the sum of the B= ase Salary and the Maximum

Incentive Payment multiplied by three (3) and (ii) to = the extent allowable under

the law, COBRA limits and t= he provisions of the applicable plan, maintain the

Benefits for a period of three (3)= years after the Termination Date. To the

extent such Benefits under = COBRA cannot be provided by law after a period of

eighteen (18) months, the C= ompany will reimburse the Executive an amount

equivalent to the cost of s= uch Benefits under COBRA to the Executive for the

remaining eighteen (18) mon= th period. Notwithstanding the foregoing, the

Executive shall not be entitled to receive any payments under Section 5.6.4

hereof, in the event the Co= mpany sells its Power Conversion business but still

continues to own at least f= ifty one (51%) percent interest in its Communications

Products business.

 

         In order for Executive to become entitled to the payments pursuant t= o

this subsection (a) as a re= sult of a termination pursuant to Section 5.5 hereof,

he shall provide the notice referred to in such Section no later than one

hundred twenty (120) days f= ollowing the Termination Date.

 

         (b)      Change of Control Defined. A "Change of Control" shall be<= o:p>

deemed to have occurred upo= n any of the following events:

 

         (i) The consummation of any of the follo= wing transactions: (A) a

merger, recapitalization or= other business combination of the Company with or

into another corporation, o= r an acquisition of securities or assets by the

Company, pursuant to which the Company is not the cont= inuing or surviving

corporation or pursuant to = which all shares of the Common Stock are converted

into cash, securities of an= other corporation or other property, other than a

transaction in which the ho= lders of the Common Stock immediately prior to such

transaction (including any preliminary or other transactions relating to such

transaction) will continue = to own at least 50% of the total voting power of the

then-outstanding securities= of the surviving or continuing corporation

immediately after such tran= saction, (B) any sale, lease, exchange, or other

transfer (in one transactio= n or a series of related transactions) of all, or

substantially all, of the a= ssets of the Company or (C) the liquidation or

dissolution of the Company,= except in connection with the voluntary or

involuntary declaration of bankruptcy or insolvency under applicable Federal

and/or state law;

 

        =             &nb= sp;                =    7

 

<PAGE>

 

         (ii) A transaction in which any Person (as such term is used in=

Sections 13 (d) (3) and 14 (d) (2) of the Securities Exchange Act of 1934, as

amended (the "Exchange Act"), corporation or other entity (other than the

Company, an affiliate of the Company, or any profit-sh= aring, employee ownership

or other employee benefit or similar plan sponsored by the Company or any of its

subsidiaries, or any truste= e of or fiduciary with respect to any such plan when

acting in such capacity, or= any group comprised solely of such entities): (A)

shall purchase Common stock= (or securities convertible into Common Stock)

representing at least 40% o= f the total voting power of the then-outstanding

securities of the Company f= or cash, securities or any other consideration

pursuant to a tender offer = or exchange offer, or (B) shall become the

"beneficial owner"= ; (as such term is defined in Rule 13d-3 under the Exchange

Act), directly or indirectly (in one transaction or a = series of related

transactions), of securitie= s of the Company representing 50% or more of the

total voting power of the then-outstanding securities of the Company ordinarily

(and apart from the rights = accruing under special circumstances) having the

right to vote in the electi= on of the Company's directors; or

 

         (iii) if, during any period of two (2) consecutive years, individuals

who at the beginning of suc= h period constituted the entire Board and any new

director whose election by = the Board or nomination for election by the Company's

stockholders was approved b= y a vote of at least a majority of the directors then

still in office who either = were directors at the beginning of the period or

whose election or nominatio= n for election by the stockholders was previously so

approved, cease for any rea= son to constitute a majority thereof.

 

(c)      Certain Additional Payments by the Company.

         ------------------------------------------

 

         (i) Anything in this Agreement to the co= ntrary notwithstanding, in the

event it shall be determine= d that any payment or distribution to or for the

benefit of the Executive (w= hether paid or payable or distributed or

distributable pursuant to t= he terms of this Agreement or any other plan,

arrangement or agreement wi= th the Company, any person whose actions result in a

Change in Control or any Person affiliated with the Co= mpany or such Person, but

determined without regard t= o any additional payments required under this Section

5.6.4(c) (a "Payment&q= uot;) would be subject to the excise tax imposed by Section

4999 of the Internal Revenue Code of 1986, as amended = (the "Code") or any

interest or penalties are i= ncurred by the Executive with respect to such excise

tax (such excise tax, toget= her with any such interest and penalties, are

hereinafter collectively re= ferred to as the "Excise Tax"), then the Executive

shall be entitled to receiv= e an additional payment (a "Gross-Up Payment") in an

amount such that after paym= ent by the Executive of all taxes (including any

interest or penalties impos= ed with respect to such taxes), including, without

limitation, any income taxe= s (and any interest and penalties imposed with

respect thereto) and Excise= Tax imposed upon the Gross-Up Payment, the Executive

retains an amount of the Gr= oss-Up Payment equal to the Excise Tax imposed upon

the Payments.

 

         (ii) Subject to the provisions of paragra= ph (ii) of this Section

5.6.4(c), all determinations required to be made under this Section 5.6.4(c),

including whether and when = a Gross-Up Payment is required and the amount of such

Gross-up Payment and the assumptions to be utilized in arriving at such

determination, shall be mad= e by a nationally recognized certified public

 

        =             &nb= sp;            =        8

 

<PAGE>

 

accounting firm designated = by the Executive (the "Accounting Firm"), which shall

provide detailed supporting calculations both to the Company and the Executive

within fifteen (15) busines= s days after receipt of notice from the Executive

that there has been a Payme= nt, or such earlier time as is requested by the

Company. All fees and expen= ses of the Accounting Firm shall be borne solely by

the Company. Any Gross-Up P= ayment, as determined pursuant to this Section

5.6.4(c), shall be paid by = the Company to the Executive within five (5) days of

the receipt of the Accounti= ng Firm's determination. Any determination by the

Accounting Firm shall be binding upon the Company and = the Executive. As a result

of the uncertainty in the application of Section 4999 of the Code at the time of

the initial determination b= y the Accounting Firm hereunder, it is possible that

Gross-Up Payments which will not have been made by the Company should have been

made ("Underpayment&qu= ot;) consistent with the calculations required to be made

hereunder. In the event tha= t the Company exhausts its remedies pursuant to

paragraph (iii) of this Sec= tion 5.6.4(c) and the Executive thereafter is

required to make a payment = of any Excise Tax, the Accounting Firm shall

determine the amount of the Underpayment that has occurred and any such

Underpayment shall be promptly paid by the Company to = or for the benefit of the

Executive.

 

         (iii) The Executive shall notify the Company in writing of any claim= by

the Internal Revenue Servic= e that, if successful, would require the payment by

the Company of the Gross-Up Payment. Such notification shall be given as soon as

practicable but no later th= an ten (10) business days after the Executive is

informed in writing of such= claim and shall apprise the Company of the nature of

such claim and the date on = which such claim is requested to be paid. The

Executive shall not pay such claim prior to the expira= tion of the thirty (30)

day period following the da= te on which it gives such notice to the Company (or

such shorter period ending = on the date that any payment of taxes with respect to

such claim is due). If the = Company notifies the Executive in writing prior to

the expiration of such peri= od that it desires to contest such claim, the

Executive shall:

 

         (A) give the Company any information reasonably requested by the

         Company relating to such claim;

 

         (B) take such action in connection with contesting such claim as the

         Company shall reasonably request in writing from time to time,<= /o:p>

         including, without limitation, accepting = legal representation with

         respect to such claim by an attorney reas= onably selected by the

         Company;

 

         (C) cooperate with the Company in good fa= ith in order effectively to

         con= test such claim; and

 

         (D) permit the Company to participate in = any proceedings relating to

         such claim;

 

provided, however, that the= Company shall bear and pay directly all costs and

expenses (including additio= nal interest and penalties) incurred in connection

with such contest and shall indemnify and hold the Executive harmless, on an

after-tax basis, for any Ex= cise Tax or income tax (including interest and

 

        =             &nb= sp;            =        9

 

<PAGE>

 

penalties with respect ther= eto) imposed as a result of such representation and

payment of costs and expens= es. Without limitation on the foregoing provisions of

this paragraph (iii) of Sec= tion 5.6.4(c), the Company shall control all

proceedings taken in connec= tion with such contest and, at its sole option, may

pursue or forego any and all administrative appeals, proceedings, hearings and

conferences with the taxing authority in respect of such claim and may, at its

sole option, either direct = the Executive to pay the tax claimed and sue for a

refund or contest the claim= in any permissible manner, and the Executive agrees

to prosecute such contest t= o a determination before any administrative tribunal,

in a court of initial juris= diction and in one or more appellate courts, as the

Company shall determine; provided, however, that if the Company directs the

Executive to pay such claim and sue for a refund, the Company shall advance the

amount of such payment to t= he Executive, on an interest-free basis and shall

indemnify and hold the Exec= utive harmless, on an after-tax basis, from any

Excise Tax or income tax (including interest or penalt= ies with respect thereto)

imposed with respect to such advance or with respect to any imputed income with

respect to such advance; an= d provided, further, that any extension of the

statute of limitations rela= ting to payment of taxes for the taxable year of the

Executive with respect to which such contested amount is claimed to be due is

limited solely to such cont= ested amount. Furthermore, the Company's control of

the contest shall be limite= d to issues with respect to which a Gross-Up Payment

would be payable hereunder = and the Executive shall be entitled to settle or

contest, as the case may be= , any other issue raised by the Internal Revenue

Service or any other taxing author= ity.

 

         (d) If, after the receipt by the Executive of an amount advanced by = the

Company pursuant to paragraph (c) of this Section 5.6.= 4, the Executive becomes

entitled to receive any ref= und with respect to such claim, the Executive shall

(subject to the Company's c= omplying with the requirements of paragraph (iii) of

this Section 5.6.4(c) promp= tly pay to the Company the amount of such refund

(together with interest pai= d or credited thereon after taxes applicable

thereto). If after the rece= ipt by the Executive of an amount advanced by the

Company pursuant to paragraph (iii) of this Section 5.6.4(c), a determination is

made that the Executive sha= ll not be entitled to any to any refund with respect

to such claim and the Compa= ny does not notify the Executive in writing of its

intent to contest such deni= al of refund prior to the expiration of thirty (30)

days after such determinati= on, then such advance shall be forgiven and shall not

be required to be repaid an= d the amount of such advance shall offset, to the

extent thereof, the amount = of Gross-Up Payment required to be paid.

 

         5.6.5 Non-Renewal By the Employer. If the Company shall give notice of

non-renewal of the Employme= nt Term in accordance with the provisions of Section

4 hereof, the Company shall pay to Executive an amount= equal to two times the

sum of the Base Salary and = the Maximum Incentive Payment, payable in twenty-four

(24) equal monthly installm= ents after the end of the Employment Term payable in

accordance with the Company= 's then regular payroll practices.

 

         The parties hereto hereby agree that, for the purposes of this Secti= on

5.6.5, the Termination Date shall be the date upon whi= ch Executive's employment

hereunder is scheduled to e= xpire pursuant to Section 4 hereof, unless the

parties hereto mutually agr= ee to an earlier date.

 

        =             &nb= sp;            =       10

 

<PAGE>

 

         Upon the payment of the foregoing amount to Executive, the Company

shall have no liability or = other obligation of any kind or character under or in

connection with this Agreem= ent, except with respect to Section 7 hereof.

 

         Following Executive's attainment of the age of 65 years, all

obligations and liabilities= of the Company under this Section 5.6.5 in respect

of its decision not to renew Executive shall forthwith terminate.

 

         6.     &nb= sp; Arbitration.

        =           -----------

 

         6.1 General. Any dispute under this Agreement arising out of or=

relating to Section 5 hereo= f shall be settled by arbitration in accordance with

this Section 6.<= /p>

 

         6.2 Commencement. Either party may serve upon the other party writte= n

notice that the dispute, sp= ecifying the nature thereof, shall be submitted to

arbitration. Within ten (10= ) days after the service of such notice, each of the

parties shall designate a disinterested arbitrator and serve written notice of

such appointment upon the o= ther party. If either party fails within the

specified time to appoint s= uch arbitrator, the other party (if such party shall

timely designate an arbitra= tor) shall be entitled to appoint both arbitrators.

The two arbitrators so appointed shall appoint a third arbitrator. If the two

arbitrators appointed shall= fail to agree upon a third arbitrator within ten

(l0) days after their appointment, then an application= may be made by either

party hereto, upon written = notice to the other party, to the American

Arbitration Association, or any successor thereto, or = if the American

Arbitration Association or its successor shall fail to appoint a third

arbitrator within ten (10) = days after such request. then either party may apply,=

with written notice to the = other, to any court of competent jurisdiction for the

appointment of a third arbi= trator, and any such appointment so made shall be

binding upon both parties h= ereto.

 

         6.3 Applicable Rules and Procedures. The arbitration shall be

conducted, to the extent co= nsistent with this Section 6, in accordance with the

then prevailing rules and p= rocedures of the American Arbitration Association or

its successor. The arbitrat= ors shall have the right to retain and consult

experts and competent autho= rities skilled in the matters under arbitration, but

all consultations shall be = made in the presence of both parties, who shall have

full right to cross-examine= the experts and authorities.

 

         6.4 Decision. The arbitrators shall render their award, upon the

concurrence of at least two= of their number, not later than thirty (30) days

after the appointment of th= e third arbitrator. Their decision and award shall be

in writing, and counterpart= copies shall be delivered to each of the parties.

Such decision of the arbitrators shall be final and bi= nding upon the parties

hereto. in rendering their award, the arbitrators shall have no power to modify

any of the provisions of th= is Agreement, and the jurisdiction and power of the

arbitrators are expressly l= imited accordingly. Judgment may be entered on the

award of the arbitrators an= d may, be enforced in any court having jurisdiction.

 

        =             &nb= sp;            =       11

 

<PAGE>

 

         Each of the parties hereto shall bear all of its/his own fees, costs=

and expenses, including att= orneys, fees, incurred by it in connection with any

arbitration proceeding purs= uant to this Section 6. Notwithstanding the

foregoing, in the event any= party fails to comply with the decision of the

arbitrators and the other p= arty undertakes any action(s) or proceeding(s) to

enforce such compliance, al= l costs and expenses (including reasonable legal

fees) incurred by the party= seeking to enforce such compliance shall be borne by

the party failing to so com= ply.

 

         7.     &nb= sp; Non-disclosure; Non-compete; Availability.

        =           -----------------------------------------

 

         7.1 "Confidential Information" Defined. "Confidential Information"

shall mean any and all info= rmation (verbal and written) of the Company or any of

its subsidiaries or with re= spect to any of their activities including, but not

limited to, information rel= ating to the Company's technology; research; test

procedures and results; manufacturing machinery and equipment; manufacturing

processes; financial inform= ation; products; identity of raw materials and

services used; purchasing; = trade secrets; costs; pricing; engineering; customers

and prospects; marketing; a= nd selling and servicing; provided, that Confidential

Information shall not include information of a general, non-proprietary nature

generally known in the indu= stry and Company specific information that in such

form is or becomes publicly available other than through improper means in which

Executive participated or of which he has knowledge.

 

         7.2 Non-Disclosure of Confidential Information. Executive hereby agr= ees

that he shall not, at any t= ime during the Employment Term (other than as may be

required in connection with= the performance by him of his duties hereunder) or

thereafter, directly or ind= irectly, use, communicate, disclose or disseminate

any Confidential Informatio= n in any manner whatsoever (except as may be required

under legal process by subp= oena or other court order), without the prior written

consent of the Company.

 

         7.3 Non-compete Covenant. Executive hereby agrees that he shall not,=

during the Employment Term = and, as long as he duly receives any payments due to

him pursuant to Section 5.6= .3 hereof, for a period of twelve (12) months

thereafter, directly or ind= irectly engage in any business (whether as owner,

manager, operator, lender, = partner, stockholder, licenser, licensee, joint

venturer, employee, consultant or otherwise) in which the Company or any of its<= /o:p>

subsidiaries, as of the Ter= mination Date, is engaged as a significant portion of

its business [it is hereby = agreed that (i) any business that constitutes at<= /o:p>

least twenty (20%) percent = of the Company's prior fiscal year's revenues and

(ii) the Company's Power Conversion, Communications Products and Repair and

Logistics business areas shall automatically be deemed "significant" hereunder

in any geographic area in w= hich the Company or any of its subsidiaries then is

so engaged. Notwithstanding= the foregoing, Executive shall be permitted to own

(as a passive investment) n= ot more than two (2%) percent of the economic

interests of a person or en= tity; provided, however, that said two (2%) percent

limitation shall apply to t= he aggregate holdings of Executive and those of all

other persons and entities = with whom Executive has agreed to act for the purpose

of acquiring, holding, voti= ng or disposing of such securities, except pursuant

to a bona fide operating ag= reement in respect of such person or entity, such as

a stockholders' agreement or partnership agreement. In the event of a

termination of the Employme= nt Term as a result of a change in a "Change of

 

          =             &nb= sp;            =     12

 

<PAGE>

 

Control", the non-compete covenant contained in t= his paragraph shall not apply

to the Executive.

 

         7.4 Certain Activities. For purposes of clarification, but not of

limitation, Executive hereb= y acknowledges and agrees that, in addition to the

provisions of Section 7.3 a= bove, he shall not, during the period referred to

therein, directly or indire= ctly, hire, offer to hire, entice away or in any

other manner persuade or at= tempt to persuade any officer, employee, agent,

lessor= , lessee, licenser, licensee, customer (including those that are being

actively solicited to become customers), creditor or supplier (each, a

"Solicited Person") of the Company or any of= its subsidiaries to discontinue or

adversely alter his or its relationship with the Company or any of its

subsidiaries so that such p= erson can start or develop a relationship with any

other person in which Execu= tive has an interest as referred to in Section 7.3

hereof. For purposes of this Section 7.4, a Solicited Person shall be deemed to

include any person or entit= y who was an officer, employee, agent, lessor,

lessee, licenser, licensee, customer, prospective customer, creditor or supplier

at any time during the six-= month period prior to the termination of the

Employment Term.=

 

         7.5 Injunctive Relief, etc. The parties hereto hereby acknowledge an= d

agree that (i) the Company would be irreparably injured in the event of a breach

by Executive of any of his = obligations under this Section 7; (ii) monetary

damages would not be an ade= quate remedy for any such breach; and (iii) the

Company shall be entitled to injunctive relief, in add= ition to any other

remedies that it may have, = in the event of any such breach. It is hereby also

agreed that the existence o= f any claims that Executive may have against the

Company or any of its subsidiaries, whether under this Agreement or otherwise,

shall not be a defense to t= he enforcement by the Company of any of its rights

under this Section 7.<= /o:p>

 

         If the Company shall commence an injunctive action against Executive= in

a court of competent jurisd= iction, Executive may commence an action in such

court, in lieu of the arbit= ration of claims under Section 6 hereof, and upon

Executive's commencement of such action, the provision= s of Section 6 hereof

shall be null and void and = of no further effect.

 

         7.6 Scope of Restrictions. It is the intent of the parties hereto th= at

the covenants and restricti= ons contained in this Section 7 shall be enforced to

the fullest extent permissi= ble under the laws and public policies of each

jurisdiction in which enfor= cement is sought. Executive hereby acknowledges that

said restrictions are reaso= nably necessary for the protection of the Company.

Accordingly, it is hereby agreed that if any provision= of this Section 7 shall

be adjudicated to be invali= d or unenforceable for any reason whatsoever, said

provision shall be (only wi= th respect to the operation thereof in the particular

jurisdiction in which such adjudication is made) construed by limiting and

reducing it so as to be enf= orceable to the fullest extent permissible, without

invalidating or limiting the remaining provisions of this Agreement or affecting

the validity or enforceabil= ity of said provision in any other jurisdiction.

 

         7.7 Non-exclusivity. The undertakings and obligations of Executive

contained in this Section 7= shall be in addition to, and not in lieu of, any

obligations which he may ha= ve with respect to the subject matter hereof, whether

by contract, as a matter of= law or otherwise.

 

        =             &nb= sp;            =       13

 

<PAGE>

 

         7.8 Availability. Reasonably subject to his employment commitments

elsewhere, Executive hereby= agrees to make himself available to the Company

after the termination of the Employment Term, at such reasonable time or times

as may be required by the C= ompany in connection with any pending or threatened

litigation or governmental investigation involving the Company, not to exceed

five (5) days in any calend= ar quarter unless otherwise mutually agreed. The

Company shall advance or reimburse Executive for any out-of-pocket expenses

reasonably incurred by him = in fulfilling his obligations under this Section 7.8

upon the submission by him = of reasonably itemized accounts therefor, and shal= l

pay Executive a mutually ag= reed upon per diem fee for any days in excess of two

(2) hereunder, including re= asonable preparation time.

 

         7.9 Survival of Provisions of Section 7. It is understood and agreed=

that the provisions of this= Section 7 shall survive the date of termination or

expiration of the Employmen= t Term.

 

         8.     &nb= sp; Miscellaneous Provisions.

        =           ------------------------

 

         8.1 Withholding. All payments required to be made to Executive by th= e

Company hereunder shall be subject to any applicable withholding under

applicable Federal, state a= nd local income tax laws. Any such withholding shall

be based upon the most rece= nt Form W-4 filed by Executive with the Company, and

Executive may from time to time revise such filing.

 

         8.2 Severability. If in any jurisdiction any term or provision hereo= f

is adjudicated to be invali= d or unenforceable, (i) the remaining terms and=

provisions hereof shall be unimpaired, (ii) any such invalidity or

unenforceability in any jurisdiction shall not invalidate, limit or render

unenforceable such provisio= n in any other jurisdiction and (iii) the invalid or

unenforceable term or provi= sion shall, for purposes of such jurisdiction, be

deemed replaced by a term or provision that is valid and enforceable and that

comes closest to expressing= the intention of the invalid or unenforceable term

or provision.

 

         8.3 Indemnification. The Company shall indemnify Executive to the

fullest extent permitted by applicable law for all amounts (including without

limitation, judgments, fine= s, settlement payments, costs, expenses and

attorneys' fees and expense= s) reasonably incurred or paid by Executive in

connection with any claim, = action, suit, investigation or proceeding arising out

of or relating to performan= ce by Executive of services for, or actions of

Executive as (or Executive's serving in the position o= f) a director, officer or

employee of, the Company, a= ny subsidiary or affiliate of the Company or any

enterprise at the Company's request, and shall advance to Executive (subject to

Executive's undertaking to repay any advances if it is determined that he is not

entitled to them) the reaso= nable costs, including attorneys fees, of defending

any such notion. The provis= ions of this Section 8.3 shall survive the

termination of this Agreeme= nt.

 

         8.4 Execution in Counterparts. This Agreement may be executed in one= or

more counterparts,  and by each of the parties hereto = in separate  counterparts,

each of which shall be deem= ed to be an original but all of which taken  together

 

        =             &nb= sp;            =       14

 

<PAGE>

 

shall constitute one and th= e same agreement, and this Agreement shall become

effective when one or more counterparts has been signed by each of the parties

hereto and delivered to the= other party hereto.

 

         8.5 Notices. All notices, requests, demands and other communications=

hereunder shall be in writi= ng and shall be deemed duly given when delivered by

hand, or when delivered if = mailed by registered or certified mail or private

courier service, postage pr= epaid, to the respective addresses as follows:

 

If to the Company, to:

 

        =           Artesyn Technologies, Inc.

        =           7900 Glades Road - Suite 500

        =           Boca Raton, = FL 33434

        =           Attn: Vice President - Chief Financial Officer

 

If to Executive, to:

 

        =           Joseph M. O'Donn= ell

        =           3681 Carlton Place

        =           Boca Raton, = Florida 33496

 

or to such other address(es) as either party hereto shall have designated by

like notice to the other Pa= rty hereto.

 

         8.6 Amendment. No provision of this Agreement may be modified, amend= ed

or discharged in any manner= , except by a written instrument executed by each of

the parties hereto.

 

         8.7 Entire Agreement. This Agreement constitutes the entire agreemen= t

of the parties hereto with = respect to the subject matter hereof, and supersedes

all prior agreements and understandings of the parties hereto, oral and written.

Each party hereto hereby acknowledges and agrees that,= other than as contained

herein, no other representa= tions or warranties, oral or written, have been made,

expressly or impliedly, by = the other party hereto.

 

         8.8 Applicable Law. This Agreement shall be governed by the laws of = the

State  of  Florida  applicable  to  contracts  made and to be  wholly  performed

therein.

 

         8.9 Headings. The headings contained herein are for the sole purpose= of

convenience of reference, a= nd shall not in any way limit or affect the meaning

or interpretation of any of= the terms or provisions of this Agreement.

 

         8.10     Non-assignability.

        =           -----------------

 

         8.10.1 By  Executive.  Neither  this  Agreement  nor any  right,  duty,

obligation or interest  hereunder  shall be assignable or delegable by Executive

without the  Company's  prior  written  consent;  however,  that  Executive  may

 

                =             &nb= sp;          15

 

<PAGE>

 

designate any of his benefi= ciaries to receive (and such beneficiaries shall

receive) any compensation, = payments or other benefits payable hereunder upon or

after his death, or the for= egoing may be transferred by the laws of descent or

distribution.

 

         8.10.2 By the Company. This Agreement and= all of the Company's rights

and obligations hereunder m= ay be assigned or transferred by it through a merger,

consolidation or other busi= ness combination, including a Change of Control. Upon

the occurrence of such a transaction, any such successor company resulting

therefrom shall be deemed to be substituted for all purposes as the Company

hereunder.

 

         8.11  Binding  Effect;=   Benefits.  This  Agreement  shall  inure to the

benefit of, and be binding = upon, the parties hereto and their respective&nb= sp; heirs,

legal representatives, succ= essors and permitted assigns.

 

         8.12 Waiver. The failure of either of the parties hereto at any time= to

enforce any provision of th= is Agreement shall not be deemed or construed to be a

waiver of any such or any o= ther provision, nor to in any way affect the validity

of this Agreement or any pr= ovision hereof or the right of either of the parties

hereto to thereafter enforc= e each and every provision of this Agreement. No

waiver of any breach of any= of the provisions of this Agreement shall be

effective unless set forth = in a written instrument executed by the party against

whom or which enforcement o= f such waiver is sought, and no waiver of any such

breach shall be construed o= r deemed to be a waiver of any other or subsequent

breach.

 

         8.13 Capacity, etc. Executive hereby represents and warrants to the<= o:p>

Company and the Company hereby represents and warrants= to Executive that: (i) he

(or it) has full power, aut= hority and capacity to execute and deliver this

Agreement, and to perform his (or its) obligations hereunder, (ii) said

execution, delivery and per= formance will not (and with the giving of notice or

lapse of time, or both, wou= ld not) result in the breach of any agreement or

other obligation to which h= e (or it) is a party or is otherwise bound and (iii)

this Agreement is his (or i= ts) valid and binding obligation enforceable in

accordance with its terms.<= o:p>

 

8.14 Entire Agreement. This Agreement constitutes the = entire agreement between

the parties hereto with res= pect to the subject matter hereof, and supersedes all

prior agreements, including= the Employment Agreement, dated June 24, 1994,

understandings, oral and wr= itten, among the parties hereto with respect to the

subject matter thereof.

 

         IN WITNESS WHEREOF, this Agreement has been executed and delivered b= y

the parties hereto as of th= e date first above written.

 

        =             &nb= sp;            =            ARTESYN TECHNOLOGIES, INC.

 

        =             &nb= sp;            =            BY: Richard J. Thomps= on

        =             &nb= sp;            =             &nb= sp;  --------------------------------

        =             &nb= sp;            =            TITLE:Vice Pr= esident, Chief

        =             &nb= sp;              =             &nb= sp;  Financial Officer

        =             &nb= sp;            =             &nb= sp;    ------------------------------

 

        =             &nb= sp;            =            Joseph M. O'Donn= ell

        =             &nb= sp;            =            ------------------------------

        =             &nb= sp;            =            Joseph M. O'Donn= ell

 

AGREED AND ACCEPTED:

 

Phillip A. O'Reil= ly

---------------------------------

Phillip A. O'Reil= ly

Chairman - Compensation Committee