This Employment
Agreement (this “Agreement”), dated as of June 1,
2009, between Coinstar, Inc., a Delaware corporation
(“Employer”), and John Harvey
(“Employee”);
WHEREAS, Employer
and Employee wish to document certain understandings and
agreements; and
WHEREAS, Employer
desires to employ Employee upon the terms and conditions set forth
herein; and
WHEREAS, Employee
is willing to provide services to Employer upon the terms and
conditions set forth herein;
NOW, THEREFORE,
for and in consideration of the foregoing premises and for other
good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, Employer and Employee hereby agree
as follows:
1. CHIEF
FINANCIAL OFFICER
Employer will
employ Employee and Employee will provide services to Employer as
its Chief Financial Officer (“CFO”).
Employee will
devote all of his productive time, ability, attention and effort to
Employer’s business and will skillfully serve its interests
during the Term (as defined below).
Employee’s
term of employment as CFO under this Agreement shall begin as of
the effective date of this Agreement and shall continue until
terminated pursuant to Section 2 of this Agreement (the
“Term”).
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JOHN HARVEY
EMPLOYMENT AGREEMENT 6-1-09
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During the Term,
Employer agrees to pay or cause to be paid to Employee, and
Employee agrees to accept in exchange for the services rendered
hereunder by him, the following compensation:
Employee’s
compensation as CFO shall consist, in part, of an annual base
salary of three hundred sixty thousand dollars ($360,000) before
all customary payroll deductions. Such annual base salary shall be
paid in substantially equal installments and at the same intervals
as other officers of Employer are paid. Employee’s salary
shall be reviewed by Employer’s Compensation Committee as
appropriate to determine in its discretion whether it is
appropriate to increase the base salary.
Employee shall be
eligible for cash bonuses consistent with the existing program for
executive officers, provided performance targets applicable to such
bonuses are met, and, provided further, any such bonus shall be
pro-rated in the event of a termination without Cause.
During the Term,
Employee will be entitled to participate, subject to and in
accordance with applicable eligibility requirements, in fringe
benefit programs as shall be provided from time to time by, to the
extent required, action of Employer’s Board of
Directors.
Employment of
Employee pursuant to this Agreement may be terminated as follows,
but in any case, the provisions of Section 4 hereof shall
survive the termination of this Agreement and the termination of
Employee’s employment hereunder:
With or without
Cause (as defined below), Employer may terminate the employment of
Employee at any time during the term of employment upon giving
Notice of Termination (as defined below).
Employee may
terminate his employment at any time, for any reason, upon giving
Notice of Termination.
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JOHN HARVEY
EMPLOYMENT AGREEMENT 6-1-09
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2.3 Automatic
Termination
This Agreement and
Employee’s employment hereunder shall terminate automatically
upon the death or total disability of Employee. The term “
total disability ” as used herein shall mean
Employee’s inability to perform the duties set forth in
Section 1 hereof for a period or periods aggregating 180
calendar days in any 12-month period as a result of physical or
mental illness, loss of legal capacity or any other cause beyond
Employee’s control, unless Employee is granted a leave of
absence by the Employer. Employee and Employer hereby acknowledge
that Employee’s ability to perform the duties specified in
Section 1 hereof is of the essence of this Agreement.
Termination hereunder shall be deemed to be effective (a) at
the end of the calendar month in which Employee’s death
occurs or (b) immediately upon a determination by the Employer
of Employee’s total disability, as defined herein.
2.4
Termination in Connection With a Change in Control
Concurrent with
the commencement of Employee’s employment hereunder as CFO,
Employee and the Company shall enter into a Change of Control
Agreement, in the form attached hereto as Exhibit A.
Notwithstanding Sections 3.1 and 3.2 of this Agreement and in
full substitution therefor, if Employee’s employment
terminates under circumstances described in the Change of Control
Agreement, Employee’s rights upon termination will be
governed by the terms of the Change of Control Agreement and his
right to termination payments under this Employment Agreement shall
cease.
The term “
Notice of Termination ” shall mean at least
30 days’ written notice of termination of
Employee’s employment, during which period Employee’s
employment and performance of services will continue;
provided , however , that Employer may, upon notice
to Employee and without reducing Employee’s compensation
during such period, excuse Employee from any or all of his duties
during such period. The effective date of the termination of
Employee’s employment hereunder shall be the date on which
such 30-day period expires.
In the event of
termination of the employment of Employee during the Term, all
compensation and benefits set forth in this Agreement shall
terminate except as specifically provided in this
Section 3:
3.1
Termination by Employer
If Employer
terminates Employee’s employment without Cause during the
Term, Employee shall be entitled to receive (a) termination
payments equal to twelve (12) months’ annual base
salary, (b) any unpaid annual base salary which has accrued
for services already performed as of the date termination of
Employee’s employment becomes effective and
(c) a
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JOHN HARVEY
EMPLOYMENT AGREEMENT 6-1-09
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pro-rated cash
bonus consistent with Section 1.4(b). All amounts payable
pursuant to this Section 3.1 (or pursuant to Section 3.2)
shall be reduced for applicable deductions and tax withholding. If,
as a result of the termination of Employee’s employment
without Cause, Employee and Employee’s spouse and dependent
children are eligible for and timely (and properly) elect to
continue coverage under Employer’s group health plan(s) in
accordance with Code Section 4980B(f) (“COBRA”),
Employer shall pay the premium for such coverage for a period of
twelve (12) months following the date of Employee’s
termination or until Employee is no longer entitled to COBRA
continuation coverage under Employer’s group health plan(s),
whichever period is the shorter. All other Employer benefits cease
on the date of termination without Cause. If Employee is terminated
by Employer for Cause during the Term, Employee shall not be
entitled to receive any of the foregoing benefits, other than those
set forth in Section 3.1(b) above.
3.2
Termination by Employee
In the case of the
termination of Employee’s employment by Employee, Employee
shall not be entitled to any payments hereunder, other than those
set forth in Section 3.1(b) hereof if such termination occurs
during the Term.
All amounts
payable pursuant to Section 3.1(b) and 3.2 hereof shall be
paid to Employee at the same time such amounts would have been paid
to Employee had Employee’s employment not been terminated (or
at such earlier time as is required by law). All amounts payable
pursuant to Section 3.1(a) hereof shall be paid to Employee in
twelve (12) equal monthly installments, beginning with the
month following the month containing the date of Employee’s
termination and continuing for eleven (11) consecutive months
thereafter. For purposes of Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”), each
such installment shall be treated as a separate payment.
Wherever reference
is made in this Agreement to termination being with or without
Cause, “ Cause ” is limited to the occurrence of
one or more of the following events:
(a) Failure
or refusal to carry out the lawful duties of Employee described in
Section 1 hereof or any directions of the Board of Directors
of Employer, which directions are reasonably consistent with the
duties herein set forth to be performed by Employee;
(b) Violation
by Employee of a state or federal criminal law involving the
commission of a crime against Employer or a felony;
(c) Current
use by Employee of illegal substances; deception, fraud,
misrepresentation or dishonesty
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