THIS EMPLOYMENT AGREEMENT
(“Agreement”) is made and entered into as of this 3rd
day of March, 2008, by and between Desktop Interactive, Inc. d/b/a
InterClick.com, a Delaware corporation (the
“Corporation”) with offices at 257 Park Avenue South,
Suite 602, New York, NY 10010, and Andrew Katz, an individual
residing at 365 SE 6 th Avenue, Apt. 307, Delray Beach, FL 33483 (the
“Employee”), under the following
circumstances:
A. The
Corporation desires to secure the services of the Employee upon the
terms and conditions hereinafter set forth; and
B. The
Employee desires to render services to the Corporation upon the
terms and conditions hereinafter set forth.
C. The
Employee has been offered a position with the Company which is of
the nature that Employee will either generate or be entrusted with
information, ideas and materials pertaining to the Corporations
proprietary system ad serving systems.
NOW, THEREFORE, the parties mutually agree as
follows:
1.
Employment. The Corporation hereby employs the Employee and
the Employee hereby accepts employment as an employee of the
Corporation, subject to the terms and conditions set forth in this
Agreement.
2.
Duties. The Employee shall serve as the Chief Technology
Officer (CTO) of Interclick and shall devote his full time effort
to help the Corporation achieve its objectives and perform such
other tasks, consistent with his position, as may be, from time to
time, assigned to him by the Chief Executive Officer of the
Corporation. The Employee shall report directly to the Chief
Executive Officer of the Corporation. The Corporation
acknowledges that to meet the objectives will require the
Corporation to make a significant investment in equipment and
personnel.
3.
Term of Employment. Subject to Section 5 below, the term of
the Employee’s employment hereunder, unless sooner terminated
as provided herein (the “ Initial Term ”), shall
be for a period of one (1) year commencing on the date
hereof. The term of this Agreement shall automatically
be extended for additional terms of one (1) year each (each a
“ Renewal Term ”) unless either party gives
prior written notice of non-renewal to the other party no later
than sixty (60) days prior to the expiration of the Initial Term
(“ Non-Renewal Notice ”), or the then current
Renewal Term, as the case may be. For purposes of this Agreement,
the Initial Term and any term in accordance with Section 5
below are hereinafter collectively referred to as the “
Term .”
4.
Compensation of Employee .
(a) The
Corporation shall pay the Employee as compensation for his services
hereunder, in equal semi-monthly or bi-weekly installments during
the Term, the sum of $225,000 per annum (the “Base
Salary”), less such deductions as shall be required to be
withheld by applicable law and regulations. The Corporation shall
increase the Base Salary on an annual basis by the amount of 10%,
starting with the anniversary date of this contract (March 3,
2009), and each anniversary date thereafter (March 3, 2010,
etc).
(b) In
addition to the Base Salary set forth in Section 4(a) above, the
Employee shall be entitled to receive an annual discretionary bonus
in an amount to be determined by the Board of Directors of the
Corporation (the “Board”) in its sole
discretion. To the extent that for that year, the
Objectives are achieved and the Corporation achieves its
profitability projections the targeted discretionary bonus shall be
50% of the Employee’s Base Salary; provided, however, whether
such a bonus shall be payable and the actual amount of such bonus,
if any, shall be determined by the Board in its sole discretion.
The annual bonus, if any, is to be paid 50% in cash and 50% in
restricted stock.
(c) The
Corporation shall pay or reimburse the Employee for all reasonable
out-of-pocket expenses actually incurred or paid by the Employee in
the course of his employment, consistent with the
Corporation’s policy for reimbursement of expenses from time
to time.
(d) The
Employee shall be entitled to participate in such pension, profit
sharing, group insurance, hospitalization, and group health and
benefit plans and all other benefits and plans, including
perquisites, if any, as the Corporation provides to its
employees.
(e) In
addition to the Base Salary, bonus compensation and any previously
granted stock options, the Employee shall receive options to
purchase 200,000 shares of the Common Stock of interCLICK, Inc.
(the “Parent”), subject to execution of the
Parent’s standard stock option agreement. The
option agreement with respect to such options shall provide for
such options to vest twenty-five percent (25%) on each anniversary
of the date hereof. The exercise price per share for
such options shall be established by the Board and subject to
adjustment for dividends, splits, reclassifications and similar
transactions.
(f) The
Employee shall execute and deliver in favor of the Corporation a
confidentiality and invention acknowledgement in the form attached
hereto as Exhibit A.
(a) This
Agreement and the Employee’s employment hereunder shall
terminate upon the happening of any of the following
events:
(1) upon
the Employee’s death;
(2) in
the event the Employee, by reason of physical or mental incapacity,
shall be substantially unable to perform his duties hereunder for a
period of 180 days out of any 360 day period (such incapacity
deemed to be “Disability”), the Corporation shall have
an option, at any time thereafter, to terminate the
Employee’s employment hereunder as a result of such
Disability. Such termination will be effective ten (10)
days after the Board gives written notice of such termination to
the Employee, unless the Employee shall have returned to the full
performance of his duties prior to the effective date of the
notice. Upon such termination, the Employee shall be
entitled to any benefits as to which he and his dependents are
entitled by law, and except as otherwise expressly provided herein,
all obligations of the Corporation hereunder shall cease upon the
effectiveness of such termination other than payment of salary
earned through the date of Disability, provided that such
termination shall not affect or impair any rights the Employee may
have under any policy of long term disability insurance or benefits
then maintained on his behalf by the Corporation. The
Employee’s Base Salary shall continue to be paid during any
period of incapacity prior to and including the date on which the
Employee’s employment is terminated for
Disability;
(3) at
the Employee’s option, upon sixty (60) days prior written
notice to the Corporation. Upon receipt of such notice,
the Corporation shall have the option to accelerate the resignation
to a date prior to the expiration of the sixty (60) day
period;
(4) at
the Employee’s option, in the event of an act by the
Corporation, defined in Section 5(b), below, as constituting
“Good Reason” for termination by the
Employee;
(5) at
the Corporation’s option, in the event of an act by the
Employee, defined in Section 5(c), below, as constituting
“Cause” for termination by the Corporation;
and
(6) at
the Corporation’s option at any time without Cause by
providing the Employee with written notice of such termination,
which termination shall take effect ten (10) days after the date
such notice is provided or, at the sole discretion of the
Corporation, at any time prior to the expiration of such ten (10)
day period.
(b) For
purposes of this Agreement, “Good Reason” shall
mean: (i) a material diminution of Employee’s
authority or duties with the Corporation (other than as a result of
Employee’s incapacity or disability); (ii) a reduction in
Employee’s Base Salary; or (iii) if Employee must relocate
his principal office more than one hundred (100) miles from any
office that the Corporation is then maintaining for Employee as
Employee’s principal office. Prior to Employee
terminating his employment with the Corporation for “Good
Reason,” Employee must provide written notice to the
Corporation that such “Good Reason” exists and setting
forth, in detail, the grounds Employee believes constitutes such
“Good Reason.” If the Corporation does not cure the
grounds upon which Employee believes “Good Reason”
exists within thirty (30) days after being provided with notice by
Employee, then Employee’s employment shall be deemed
terminated.
(c) For
purposes of this Agreement, the term “Cause” shall
mean, (i) the willful or continued failure by the Employee to
substantially perform his duties, including, but not limited to,
acts of fraud, willful misconduct, gross negligence or other act of
dishonesty, (ii) a material violation or material breach of this
Agreement which is not cured within ten (10) days after receipt of
notice thereof, (iii) misappropriation of funds, properties or
assets of the Corporation by the Employee or any action which has a
materially adverse effect on the Corporation or its business, (iv)
the Employee’s conviction of or entering of a guilty plea or
a plea of no contest with respect to a felony or any crime
involving moral turpitude, fraud, larceny embezzlement, dishonesty,
(v) abuse of drugs or alcohol which impairs the Employee’s
ability to perform his duties as CTO, or (vi) a knowing violation
of the CAN-SPAM Act of 2003.
6.
Effects of Termination . In the event the
Employee’s employment is terminated pursuant to Section
5(a)(4) or (6) of this Agreement, then the Corporation shall
continue to pay the Employee his Base Salary as in effect on the
date of termination for a period of six (6) months and the
Corporation shall reimburse the Employee for the costs of obtaining
comparable medical benefits for six (6) months, unless the Employee
obtains other employment which provides for comparable medical
benefits as the Employee received while employed by the
Corporation. In the event the Employee’s
employment is terminated for any other reason, then the Employee
shall be entitled to receive his Base Salary through the effective
date of termination and the Corporation shall reimburse the
Employee for any reasonable expenses previously incurred for which
the Employee had not been reimbursed prior to the termination of
employment. The Employee acknowledges and agrees that prior to
receiving any payments which may be due under this Section 6, and
as a material condition thereof, the Employee shall, if requested
by the Corporation, sign and agree to be bound by a general release
of claims against the Corporation related to the Employee’s
employment (and termination of employment) with the Corporation in
such form as the Corporation may deem appropriate. Upon
the Employee’s termination of employment for any reason, upon
the request of the Board, he shall resign any memberships or
positions that he then holds with the Corporation.
7.
Disclosure of Confidential Information. The Employee
recognizes, acknowledges and agrees that he has had and will
continue to have access to secret and confidential information
regarding the Corporation, including but not limited to, its
products, formulae, patents, sources of supply, customer dealings,
data, know-how and business plans, provided such information is not
in or does not hereafter become part of the public domain, or
become known to others through no fault of the Employee. The
Employee acknowledges that such information is of great value to
the Corporation, is the sole property of the Corporation, and has
been and will be acquired by him in confidence. In consideration of
the obligations undertaken by the Corporation herein, the Employee
will not, at any time, during or after his employment hereunder,
reveal, divulge or make known to any person, any information
acquired by the Employee during the course of his employment, which
is treated as confidential by the Corporation, and not otherwise in
the public domain. The provisions of this Section 7 shall survive
the termination of the Employee’s employment
hereunder.
8.
Covenant Not To Compete or Solicit. Upon
execution of this Employment Agreement, the Employee and the
Corporation shall enter into that certain Non-Competition and
Confidentiality Agreement attached hereto in the form of Exhibit
A.
(a) The
Employee acknowledges that the services to be rendered by him under
the provisions of this Agreement are of a special, unique and
extraordinary character and that it would be difficult or
impossible to replace such services. Accordingly, the Employee
agrees that any breach or threatened breach by him of Sections 7 or
8 of this Agreement shall entitle the Corporation, in addition to
all other legal remedies available to it, to apply to any court of
competent jurisdiction to seek to enjoin such breach or threatened
breach without the Corporation having to plead or prove an
inadequate remedy at law or irreparable harm or post a bond. The
parties understand and intend that each restriction agreed to by
the Employee hereinabove shall be construed as separable and
divisible from every other restriction, that the unenforceability
of any restriction shall not limit the enforceability, in whole or
in part, of any other restriction, and that one or more or all of
such restrictions may be enforced in whole or in part as the
circumstances warrant. In the event that any restriction in this
Agreement is more restrictive than permitted by law in the
jurisdiction in which the Corporation seeks enforcement thereof,
such restriction shall be limited to the extent permitted by law.
The remedy of injunctive relief herein set forth shall be in
addition to, and not in lieu of, any other rights or remedies that
the Corporation may have at law or in equity.
(b) Neither
the Employee nor the Corporation may assign or delegate any of
their rights or duties under this Agreement without the express
written consent of the other; provided however that the Corporation
shall have the right to delegate its obligation of payment of all
sums due to the Employee hereunder, provided that such delegation
shall not relieve the Corporation of any of its obligations
hereunder.
(c) This
Agreement constitutes and embodies the full and complete
understanding and agreement of the parties with respect to the
Employee’s employment by the Corporation, supersedes all
prior understandings and agreements, whether oral or written,
between the Employee and the Corporation, and shall not be amended,
modified or changed except by an instrument in writing executed by
the party to be charged. The invalidity or partial invalidity of
one or more provisions of this Agreement shall not invalidate any
other provision of this Agreement. No waiver by either party of any
provision or condition to be performed shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same time or
any prior or subsequent time.
(d) This
Agreement shall inure to the benefit of, be binding upon and
enforceable against, the parties hereto and their respective
successors, heirs, beneficiaries and permitted assigns.
(e) The
headings contained in this Agreement are for convenience of
reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) All
notices, requests, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be
deemed to have been duly given when personally delivered, sent by
registered or certified mail, return receipt requested, postage
prepaid, or by private overnight mail service (e.g. Federal
Express) to the party at the address set forth above or to such
other address as either party may hereafter give notice of in
accordance with the provisions hereof. Notices shall be deemed
given on the sooner of the date actually received or the third
business day after sending.
(g) This
Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York without reference to
principles of conflicts of laws and each of the parties hereto
irrevocably consents to the jurisdiction and venue of the federal
and state courts located in the State of New York.
(h) This
Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one of the same instrument. The
parties hereto have executed this Agreement as of the date set
forth above.
(i)
Severability . The covenants of this Agreement
shall be construed as covenants independent of one another and as
obligations distinct from any other agreement between the
parties. Should any provision herein be held to be void
or unenforceable, the remaining provisions shall remain in full
force and effect, to be read and construed as if the void or
unenforceable provisions were originally deleted.
(a) Notwithstanding
anything to the contrary contained in this Agreement, if at the
time of the Employee’s separation from service within the
meaning of Section 409A of the Code, the Corporation
determines that the Employee is a “specified employee”
within the meaning of Section 409A(a)(2)(B)(i) of the Code,
then to the extent any payment or benefit that the Employee becomes
entitled to under this Agreement on account of the Employee’s
separation from
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