Exhibit 10.1
ACTIVIDENTITY
CORPORATION
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (the
“ Agreement ”) is made and entered into
as of August 1, 2008 by and between ActivIdentity Corporation,
a Delaware corporation (the “ Company” ),
and Jacques Kerrest (the “ Employee
”).
1.
Position . You will serve as the Chief Financial
Officer and Chief Operating Officer of the Company. You will
be responsible for all of the duties normally attributed to the
offices of the Chief Financial Officer and Chief Operating Officer
of similar publicly traded companies. Your office will be
located at the Company’s headquarters at 6623 Dumbarton
Circle, Fremont, California. Your service will commence on a
part-time basis on August 4, 2008 (the “ Effective
Date ”) and will commence on a full-time basis on
August 18, 2008. You will report to the Company’s
Chairman and Chief Executive Officer and shall perform such duties
as the Chairman and Chief Executive Officer may from time to time
require. You will be employed on an at-will basis, which
means that you may resign and the Company may terminate your
employment or change your job title and duties at any time for any
reason or for no reason.
You agree to the best of your
ability and experience that you will at all times loyally and
conscientiously perform all of the duties and obligations required
of you pursuant to the terms of this Agreement, and will do so to
the reasonable satisfaction of the Chairman and Chief Executive
Officer. During the term of your full-time employment, you
further agree that you will devote all of your business time and
attention to the business of the Company. The Company will be
entitled to all of the benefits and profits arising from or
incident to all such work services and advice. You will not
render commercial or professional services of any nature to any
person or organization, whether or not for compensation, without
the prior written consent of the Board of Directors.
You will not directly or indirectly engage or participate in any
business that is competitive in any manner with the business of the
Company. Nothing in this Agreement will prevent you from
accepting speaking or presentation engagements in exchange for
honoraria or from serving on boards or charitable organizations, or
from owning no more than one percent (1%) of the outstanding equity
securities of a corporation whose stock is listed on a national
stock exchange.
2.
Compensation
.
a.
Salary . You will be paid a monthly salary of
$27,083.33, which is equivalent to $325,000 on an annualized
basis. Your salary will be payable twice a month pursuant to
the Company’s regular payroll practices (or in the same
manner as other employees of the Company), and shall be subject to
the usual, required withholding of income and employment
taxes. Your annual salary of $325,000, together with any
increases thereto, shall be referred to as your “ Base
Salary .” Base Salary will be subject to annual
review by the Compensation Committee of the Board of Directors (the
“ Compensation Committee ”).
b.
Bonus . You will be eligible for a target bonus
(“ Target Bonus ”) equivalent to a
certain percentage of your Base Salary, which for fiscal 2008 has
been set at 65% of your Base Salary, with the potential for payment
of up to two times that amount in a given year for extraordinary
performance (the actual bonus amount for fiscal 2008 is expected to
be pro rated for a partial year). Your Target Bonus
percentage, the performance goals and objectives that your Target
Bonus will be based upon and ultimate determination of the Target
Bonus payment you receive will be determined by the Compensation
Committee.
c.
Equity Awards
. On the Effective Date, you
will be awarded the two stock options described below to purchase
650,000 and 700,000 shares of Company common stock,
respectively. The options will be exercisable at a price per
share equal to the last reported closing price of the
Company’s common stock on the day before the Effective Date,
as reported on the Nasdaq Global Market, and the options will be
granted outside of the Company’s stockholder-approved equity
compensation plans as an “inducement award,” but will
be subject to the terms and conditions of the Company’s 2004
Equity Incentive Plan as if granted thereunder.
(i)
The first option, which represents
the right to purchase up to 650,000 shares of common stock, (the
“ First Option ”) will vest with respect
to one-quarter of the underlying shares on the first anniversary of
the Effective Date and then with respect to the remaining shares
monthly thereafter over the next three years so that it is fully
vested on the fourth anniversary of the Effective Date. The
First Option will vest immediately if, following a Change of
Control (defined below), you are removed as Chief Financial Officer
or Chief Operating Officer and such removal is other than for Cause
(defined below).
(ii)
The second option, which represents
the right to purchase up to 700,000 shares of common stock, (the
“ Second Option ”) will vest only in the
event that the Company’s average closing price of its common
stock over a 90-day period, as reported on the Nasdaq Global
Market, is equal to or greater than $4.50 per share (the “
Stock Target ”). Once the Stock Target
has been satisfied, the Second Option will vest immediately with
respect to 350,000 shares and will then vest with respect to the
remaining shares monthly thereafter over the next 12 months,
provided that you continue to provide service to the Company during
that time. If the Stock Target is not achieved by the fourth
anniversary of the Effective Date, then the Second Option will be
forfeited in its entirety. The Second Option will vest
immediately if, following a Change of Control (defined below), you
are removed as Chief Financial Officer or Chief Operating Officer
and such removal is other than for Cause (defined
below).
(iii)
Both options will have a seven-year
term and will be treated as non-qualified under the Internal
Revenue Code.
3.
Employee Benefits
. You will be eligible to
participate in the employee benefits plan currently and hereafter
maintained by the Company of general applicability to other
senior
2
executives of the Company, including
the Company group health insurance, dental insurance and
401(k) plans. The Company reserves the right to cancel
or change the employee benefit plans and programs it offers to its
employees at any time. You will be given a copy of, and must
abide by, the Company’s employee handbook and employee
benefit plan documents which will describe more fully these and
other benefits of your employment, as well as the personal policies
and procedures which apply to employment with the
Company.
4.
Relocation and Expense
Reimbursement .
a.
Relocation
Reimbursement . You will
be entitled to reimbursement of all reasonable and properly
documented expenses, up to a reasonable limit to be mutually agreed
upon, incurred by you in connection with your relocation to the Bay
Area, which expenses may include moving expenses, temporary housing
and expenses relating the sale of your home in McLean.
b.
Expense Reimbursement
. You will be entitled to
reimbursement of all reasonable and properly documented expenses
incurred by you in the performance of your duties, in accordance
with the Company’s policies and procedures.
5.
Severance . In the absence of a Change of Control,
if your employment with the Company is terminated by the Company
without “ Cause ” (as defined below) or
you resign your employment for “ Good Reason
” (as defined below), then you shall be entitled to receive
the following severance benefits:
a.
You will receive 12 months’
Base Salary, plus the Target Bonus for that year, less applicable
withholding taxes (the “ Severance Payment
”).
b.
The
