EMPLOYMENT
AGREEMENT
August 26,
2008
Laura
Hunter
[Home
Address]
Dear
Laura:
I
am pleased to offer you the position of Vice President and General
Counsel of Obagi Medical Products, Inc. (the “Company”)
effective September 3, 2008 on the following terms:
You will perform the duties customarily
associated with this position with respect to the Company’s
operations on a full-time basis, and will report directly to the
Chief Financial Officer/Executive Vice President, Operations and
Administration
Salary : Your salary shall be $260,000 per
annum paid in accordance with the Company’s normal payroll
practices, and subject to standard payroll deductions and
withholdings.
Annual
Performance Bonus : You shall be entitled to an annual
performance bonus based on the achievement of certain benchmarks to
be set by the Board of Directors of the Company in its sole
discretion. You will be eligible for an annual
performance bonus of up to 40% of your base salary beginning in the
year 2008 as adjusted for performance in accordance with the
benchmarks to be established. No bonus is payable unless
you are employed by the Company on the day the Board approves
bonuses of the applicable year. All bonuses are
subject to Board approval and will be paid in accordance with the
Company’s normal payroll practices, subject to standard
payroll deductions and withholdings.
Sign On
Bonus
You will
also be eligible to receive a signing bonus of $10,000 to be paid
on 12/31/08. Within your first 30 days of employment,
you will meet with your manager to discuss goals to be
met
which will
enable you to receive your bonus. You will have to be employed full
time as of 12/31/08 to receive this bonus.
Stock
Options: You will
be eligible to receive a stock option grant of 40,000 shares,
subject to the stock option plan and Board Approval. The
grant of the stock options will be subject to the other terms and
provisions of the Company’s 2008 Stock Option Plan and Stock
Option Agreement and its subsequent amendments, and to the
satisfaction of all federal and state securities
laws. The exercise price of such options will be
determined at the end of day stock price on the date of
hire.
Benefits: You will be eligible to enroll in the
Company’s group life, medical, dental and vision plans on
September 3, 2008. Additional information regarding plan
options and benefit summaries is enclosed. You will also receive
all other benefits the Company provides to similarly situated
employees (e.g., health and dental insurance coverage).
Annual
Leave: You will be
eligible for the following annual leave:
3 Weeks
Vacation
4 Floating
days
6 Days of sick
leave
9
Holidays
The Company shall reimburse you for all other
reasonable, ordinary and necessary expenses incurred in the
performance of your duties (such reimbursement shall be conditioned
upon the submission of reasonable detailed receipts and/or invoices
substantiating such expenses).
Either
you or the Company may terminate your employment with or without
cause, at any time, for any reason whatsoever without advance
notice. This at-will employment relationship cannot be
changed except by in writing signed by the CEO of the
Company. Your signature below confirms your
understanding that your employment with Obagi is
“At-Will” at all times.
If
the Company terminates your employment for any reason, except for
cause, during the first year of your employment, you will receive
as your sole severance, your base salary for the greater of the
remaining term of the initial twelve months or 6 months, payable
semi-monthly, subject to standard payroll deductions and
withholdings. If the Company terminates your employment
for any reason, except for cause, after the first year of your
employment, you will receive as your sole severance, your base
salary for six (6) months payable semi-monthly, subject to standard
payroll deductions and withholdings. If the Company
terminates your employment, except for cause, after the first year
of your employment, but due to a change of control within twelve
months of the change of control, you will receive as your sole
severance, your base salary for twelve (12) months payable
semi-monthly, subject to standard payroll
deductions and
withholdings. These payments shall cease immediately if
you violate any provision of this Agreement, including the
provisions of Section G. If the Company exercises either
of these rights to terminate your employment, you will be paid all
earned wages upon termination, and no further compensation will be
owed to you other than the severance payment referred to
herein.
If
you voluntarily terminate your employment within the first year of
your employment, you will be required to reimburse the Company an
amount equal to your reimbursed relocation costs.
If
you voluntarily terminate your employment, if you die or become
physically or mentally disabled (subject to the Company’s
requirement to comply with all applicable laws), or if the Company
terminates your employment for cause, you will be paid all earned
wages upon termination, and no further compensation or including
severance benefits, will be owed to you. For purposes of
this Agreement, term
