Exhibit 99.3
Executive Retention and Severance
Agreement
This
Executive Retention and Severance Agreement (the
“Agreement” ) is made and entered
into as of June 26, 2009 (the "Effective Date"
), by and between Move, Inc. and Robert J. Krolik
(the
" Executive "). Capitalized terms used in this
Agreement shall have the meanings set forth in Section 4,
below.
1.
Purpose . The purpose of this Agreement is (i) to encourage
Executive to remain in the employ of the Company (as defined in
Section 4.3) and to continue to devote Executive's full attention
to the success of the Company and (ii) to provide specified
benefits to Executive in the event of a Termination Upon Change of
Control or a Termination in Absence of Change of Control, as such
terms are defined in Section 4 of this Agreement.
2.
Termination Upon Change of Control . In the event of
Executive's Termination Upon a Change of Control, provided that
Executive complies with Section 5.2 below and provides the
transition services that the Company may request as described in
Section 5.3 below, Executive shall receive the following payments
and benefits:
2.1
Accrued Salary and Vacation, and Benefits . Executive shall
receive all salary and accrued vacation (less applicable
withholding) earned through the conclusion of the transition period
(or termination date if there is no transition period requested by
the Company), and the benefits, if any, under Company benefit plans
to which Executive may be entitled pursuant to the terms of such
plans. In addition, the Company shall pay 100% of the Executive's
COBRA premiums for the same or reasonably equivalent medical
coverage he had on the date of his termination for a period not to
exceed the earlier of one (1) year following termination or until
Executive becomes eligible for medical insurance coverage at a new
employer.
2.2
Cash Severance Payment . Executive shall receive a lump sum
payment in an amount equal to twelve (12) months of Executive's
base salary (less applicable withholding), paid within five (5)
business days after the conclusion of the transition period (or
after the termination date if there is no transition period
requested by the Company).
2.3
Cash Bonus Payment . Executive shall receive a payment in an
amount (the " Minimum Bonus Payment ") equal to fifty
percent (50%) of Executive's "Target Bonus" for the year in which
Executive's termination date occurs. In addition, if Executive's
termination date occurs in the second half of the year (i.e., after
June 30th), and all financial performance criteria established in
Executive's bonus plan are achieved by the Company for the full
year in which Executive's termination date occurs, then the Company
will pay Executive an additional amount (the " Contingent
Bonus Payment ") equal to (i) a pro rata portion of
Executive's Target Bonus prorated based on the number of days
Executive is employed by the Company during such year, less (ii)
the Minimum Bonus Payment. " Target Bonus " means the
total bonus amount Executive would be entitled to receive for the
entire year assuming achievement of 100% of the financial and
non-financial objectives established in Executive's bonus plan (but
not including any additional bonus amount payable for over
achievement of objectives). The Minimum Bonus Payment shall be paid
in a lump sum within five (5) business days after the conclusion of
the transition period (or after the termination date if there is no
transition period requested by the Company) without regard to the
actual satisfaction of any performance criteria. The Contingent
Bonus Payment, if any, shall be paid in a lump sum within sixty
(60) days after the end of the year in which Executive’s
termination date occurs.”
2.4
Stock Award Acceleration . Immediately prior to
the effective date of the Change of Control, 100% of all
outstanding stock options granted and restricted stock described in
the letter from Seven Berkowitz dated June __, 2009 (the “
Letter ”), (collectively the "
Outstanding Equity "), shall vest. In addition, all
Outstanding Equity consisting of stock options shall be exercisable
by Executive for a period of one year following the end of such
transition period (if any) or one (1) year following termination if
the Company requests no transition period.
3.
Termination in Absence of Change of Control . In the event
of Executive's Termination in Absence of a Change of Control,
provided that Executive complies with Section 5.2 below and
performs the transition services that the Company may request as
described in Section 5.3 below, Executive shall receive the
following payments and benefits:
3.1
Basic Severance Compensation . Executive shall receive all
salary and accrued vacation (less applicable withholding) earned
through the conclusion of the transition period (or termination
date if there is no transition period requested by the Company),
and the benefits, if any, under Company benefit plans to which
Executive may be entitled pursuant to the terms of such plans. In
addition, the Company shall pay 100% of the Executive's COBRA
premiums for the same or reasonably equivalent medical coverage he
had on the date of his termination for a period not to exceed the
earlier of one (1) year following termination or until Executive
becomes eligible for medical insurance coverage at a new
employer.
3.2
Cash Severance Payment. Executive shall receive an amount
equal to twelve (12) months of Executive's base salary (less
applicable withholding), paid within five (5) business days after
the conclusion of the transition period (or termination date if
there is no transition period requested by the Company.)
3.3
Cash Bonus Payment . Executive shall receive a payment in an
amount (the " Minimum Bonus Payment ") equal to fifty
percent (50%) of Executive's "Target Bonus" for the year in which
Executive's termination date occurs. In addition, if Executive's
termination date occurs in the second half of the year (i.e., after
June 30th), and all financial performance criteria established in
Executive's bonus plan are achieved by the Company for the full
year in which Executive's termination date occurs, then the Company
will pay Executive an additional amount (the " Contingent
Bonus Payment ") equal to (i) a pro rata portion of
Executive's Target Bonus prorated based on the number of days
Executive is employed by the Company during such year, less (ii)
the Minimum Bonus Payment. " Target Bonus " means the
total bonus amount Executive would be entitled to receive for the
entire year assuming achievement of 100% of the financial and
non-financial objectives established in Executive's bonus plan (but
not including any additional bonus amount payable for over
achievement of objectives). The Minimum Bonus Payment shall be paid
in a lump sum within five (5) business days after the conclusion of
the transition period (or after the termination date if there is no
transition period requested by the Company) without regard to the
actual satisfaction of any performance criteria. The Contingent
Bonus Payment, if any, shall be paid in a lump sum within sixty
(60) days after the end of the year in which Executive's
termination date occurs. Payments under this section shall be less
applicable withholding.
3.4
Stock Award Acceleration . Upon Executive's termination
date, 100% of all outstanding stock options granted by the Company
to Executive described in the Letter (collectively the "
Outstanding Options ") shall vest. In addition, all
Outstanding Options, including the accelerated options described
above, shall be exercisable by Executive for a period of one (1)
year following the end of such transition period (if any) or one
year following termination if the Company requests no transition
period.
4.
Definitions . Capitalized terms used, but not previously
defined, in this Agreement shall have the meanings set forth in
this Section 4.
4.1
"Cause" means (a) your willful and continued failure to
perform substantially your duties with the Company (other than any
such failure resulting from incapacity due to physical or mental
illness, and specifically excluding any failure by you, after
reasonable efforts, to meet performance expectations), for thirty
(30) days after a written demand for substantial performance is
delivered to you by the Chief Executive Officer of Move which
specifically identifies the manner in which the Chief Executive
Officer believes that you have not substantially performed your
duties, or (b) your willful engagement in illegal conduct or gross
misconduct which is materially and demonstrably injurious to the
Company. For purposes of this provision, no act or failure to act,
on the part of you, shall be considered "willful" unless it is
done, or omitted to be done, by you in bad faith without reasonable
belief that your action or omission was in the best interests of
the Company.
4.2
"Change of Control" means (a) any "person" (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the “ Exchange Act ”)),
other than a trustee or other fiduciary holding securities of the
Company under an employee benefit plan of the Company, becomes the
"beneficial owner" (as defined in Rule 13d-3 promulgated under the
Exchange Act), directly or indirectly, of securities of the Company
representing 50% or more of (A) the outstanding shares of common
stock of the Company or (B) the combined voting power of the
Company's then-outstanding securities; (b) the Company is party to
a merger or consolidation, or series of related transactions, which
results in the voting securities of the Company outstanding
immediately prior thereto failing to continue to represent (either
by remaining outstanding or by being converted into voting
securities of the surviving or another entity) at least fifty (50%)
percent of the combined voting power of the voting securities of
the Company or such surviving or other entity outstanding
immediately after such merger or consolidation; (c) the sale or
disposition of all or substantially all of the Company's assets (or
consummation of any transaction, or series of related transactions,
having similar effect), unless at least fifty (50%) percent of the
combined voting power of the voting securities of the entity
acquiring those assets is held by persons who held the voting
securities of the Company immediate prior to such transaction or
series of transactions; (d) there occurs a change in the
composition of the Board of Directors of the Company within a
two-year period, as a result of which fewer than a majority of the
directors are Incumbent Directors; (e) the dissolution or
liquidation of the Company, unless after such liquidation or
dissolution all or substantially all of the assets of the Company
are held in an entity at least fifty (50%) percent of the combined
voting power of the voting securities of which is held by persons
who held the voting securities of the Company immediately prior to
such liquidation or dissolution; or (f) any transaction or series
of related transactions that has the substantial effect of anyone
or more of the foregoing.
4.3
"Company" means Move, Inc., any successor thereto and,
following a Change of Control, any successor or owner of
substantially all the business and/or assets of Move,
Inc.
4.4
"Diminution of Responsibilities" means the occurrence of any
of the following conditions, without Executive’s consent and
which condition is not cured by the Company within thirty
(30) days after notice by Executive specifying the condition
(which notice must be given no later than 90 days after the initial
occurrence of such event): (a) a reduction by the Company of
Executive’s duties, responsibilities, authority or reporting
relationship such that Executive no longer serves in a substantive,
senior executive role for the Company comparable in stature to
Executive’s current role, or no longer reports to the chief
executive officer of the Company; (b) a material reduction in
Executive’s base salary or the percentage of his base salary
on which his target bonus is based, provided that a reduction in
base salary that is the result of a general reduction in salary in
an amount similar to reductions for other similarly situated
Company executives shall not constitute a “Diminution of
Responsibilities”; (c) a material reduction in benefits
(other than future option grants), provided that a reduction in
benefits that is the result of a general reduction in benefits in
an amount similar to reductions for other similarly situated
Company employees shall not constitute a “Diminution of
Responsibilities”; (d) the Company’s requiring
Executive to be based at any office or location more than 50 miles
from the Company’s headquarters in Campbell, California; or
(e) a material breach by the Company of the terms of this
Agreement or the Letter to you.
4.5
"Disability" means the inability to engage in the
performance of Executive's duties by reason of a physical or mental
impairment which constitutes a permanent and total disability in
the opinion of a qualified physician.
4.6
"Incumbent Director" means a director who (1) is a director
of the Company as of the Effective Date, (2) is elected, or
nominated for election, to the Board of Directors of the Company
with the affirmative votes of at least a majority of the Incumbent
Directors at the time of such election or nomination, or (3) was
not elected or nominated in connection with an actual or threatened
proxy contest relating to the election of directors to the
Company.
4.7
"Termination in Absence of Change of Control"
means:
a) any
termination of employment of Executive by the Company without Cause
(i) that occurs prior to the date that the Company first publicly
announces it has entered into a definitive agreement or that the
Company's Board of Directors has endorsed a tender offer for the
Company's stock that in either case if consummated would result in
a Change of Control (even though consummation is subject to
approval or requisite tender by the Company's stockholders and
other conditions and contingencies), (ii) that occurs after the
Company announces that any definitive agreement or tender offer
referred to in clause (i) has been terminated and before it
announces it has entered into another such definitive agreement or
the Board of Directors has endorsed another tender offer, or (iii)
that occurs more than twelve (12) months following the consummation
of any transaction or series of related transactions that result in
a Change of Control; or
(b) any
resignation by Executive based on a Diminution of Responsibilities
that occurs within one-hundred and eighty (180) days following the
occurrence of one of the conditions that constitutes a Diminution
of Responsibilities, but only where such Diminution of
Responsibilities occurs: (i) prior to the date that the Company
first publicly announces it has entered into a definitive agreement
or that the Company's Board of Directors has endorsed a tender
offer for the Company's stock that if consummated would result in a
Change of Control (even though consummation is subject to approval
or requisite tender by the Company's stockholders and other
conditions and contingencies), (ii) after the Company announces
that any definitive agreement or tender offer referred to in clause
(i) has been terminated and before it announces it has entered into
another such definitive agreement or the Board of Directors has
endorsed another tender offer, or (iii) more than twelve (12)
months following the consummation of any transaction or series of
related transactions that result in a Change of Control.
Notwithstanding anything to the contrary herein,
the term Termination in Absence of Change of Control shall not
include termination of the employment of Executive (1) by the
Company for Cause; (2) as a result of the voluntary termination of
employment by Executive for reasons other than a Diminution of
Responsibilities; or (3) that is a Termination Upon a Change of
Control.
4.8
"Termination Upon Change of Control" means:
(a) any
termination of the employment of Executive by the Company without
Cause during the period commencing on or after the date that the
Company first publicly announces that it has signed a definitive
agreement or that the Company's Board of Directors has endorsed a
tender offer for the Company's stock that in either case when
consummated would result in a Change of Control (even though
consummation is subject to approval or requisite tender by the
Company's stockholders and other conditions and contingencies) and
ending at the earlier of the date on which the Company publicly
announces that such definitive agreement or tender offer has been
terminated without a Change of Control or on the date which is
twelve (12) months following the consummation of any transaction or
series of transactions that results in a Change of Control;
or
(b) any
resignation by Executive based on a Diminution of Responsibilities
where (i) such Diminution of Responsibilities occurs during the
period commencing on or after the date that the Company first
publicly announces that it has signed a definitive agreement that
when consummated would result in a Change of Control (even though
consummation is subject to approval or requisite tender by the
Company's stockholders and other conditions and contingencies) and
ending on the date which is twelve (12) months following the
consummation of the transaction or series of transactions that
results in the Change of Control, and (ii) such resignation occurs
within one-hundred and eighty (180) days following such Diminution
of Responsibilities.
Notwithstanding anything to the contrary herein,
the term Termination Upon Change of Control shall not include any
termination of the employment of Executive (1) by the Company for
Cause; (2) as a result of the voluntary termination of employment
by Executive for reasons other than a Diminution of
Responsibilities; or (3) that is a Termination in Absence of Change
of Control.
5. No
Other Benefits; Release; Transition Period; Termination Under Other
Circumstances.
5.1
No Other Benefits Payable . Executive shall be entitled to
no other compensation, benefits, or other payments from the Company
as a result of any termination of employment.
5.2
Release of Claims . The Company may condition payment of the
cash severance in Sections 2 or 3 of this Agreement upon the
delivery by Executive of a signed mutual release of known and
unknown claims related to Executive's employment in the form
attached hereto as Exhibit A; provided that upon receipt of such
mutual release, the Company uses its best efforts to execute such
mutual release.
5.3
Transition Period . In the event that the Company
or the Executive gives notice to the other party of its intention
to terminate Executive’s employment with the Company under
circumstances that would constitute a Termination Upon a Change of
Control or Termination in Absence of a Change of Control (the
“Termination Notice”), the Company shall have the
right, exercisable by notice to Executive given at any time prior
to ten (10) days after its receipt or delivery of the
Termination Notice, to request that Executive remain employed by
the Company for such period as the Company may elect, but in no
event longer than one hundred eighty (180) days following its
receipt or delivery of the Termination Notice. If Executive agrees
to such transition period (by giving notice to the Company within
five (5) d
