Exhibit 10.15
ALIEN TECHNOLOGY
CORPORATION
BOB EULAU EMPLOYMENT
AGREEMENT
This Agreement is entered into as of
February 22, 2006 by and between Alien Technology Corporation (the
“Company”) and Bob Eulau
(“Executive”).
1. Duties and Scope of
Employment .
(a) Positions and Duties .
Executive will serve as Executive Vice President and Chief
Financial Officer, reporting to the Chief Executive Officer (the
“CEO”). Executive will render such business and
professional services in the performance of his duties, consistent
with Executive’s position within the Company, as will
reasonably be assigned to him by the CEO. The period Executive is
employed by the Company under this Agreement is referred to herein
as the “Employment Term”.
(b) Obligations . During the
Employment Term, Executive will devote Executive’s full
business efforts and time to the Company. Executive shall work
exclusively for the Company during the Employment Term, provided
however, that Executive may participate in outside activities, as
long as such activities do not interfere with the obligations
described hereunder, are not for competitors and are consistent and
in compliance with the Company’s conflict of interest policy;
provided further, that Executive must obtain prior approval from
the Nominating Committee of the Company’s Board of Directors
for any Board memberships other than Portal Software, Inc. (which
approval will not be unreasonably withheld).
2. At-Will Employment .
Executive and the Company agree that Executive’s employment
with the Company constitutes “at-will” employment.
Executive and the Company acknowledge that this employment
relationship may be terminated at any time, upon written notice to
the other party, with or without Cause (as defined in
Section 10) or for any or no Cause, at the option either of
the Company or Executive. However, as described in this Agreement,
Executive may be entitled to severance benefits depending upon the
circumstances of Executive’s termination of
employment.
3. Term of Agreement . This
Agreement will remain in effect from the Executive’s initial
hire date, which will occur on or about March 2, 2006 (the
“Effective Date”), until his employment terminates and
both parties have satisfied all of their obligations under this
Agreement.
4. Compensation .
(a) Base Salary . As of the
Effective Date, the Executive will receive a regular base salary of
$9,615.38, which will be paid bi-weekly (this equates to an annual
salary of $250,000 and referred to herein as the “Base
Salary”) in accordance with the Company’s normal
payroll procedures and be subject to the usual, required
withholdings.
(b) Incentive Compensation .
The Executive will be eligible for an annual performance bonus with
a target amount of $250,000 based on the Company meeting its
planned
achievement targets, with upside
potential beyond that amount. In subsequent fiscal years,
Executive’s incentive compensation will be determined and
paid in the same manner and to the same level established by the
Company’s Compensation Committee and Board of Directors for
senior executives of the Company.
(i) Advance . In addition,
the Company agrees to pay Executive, within ten (10) days of
the Effective Date, the sum of $150,000 (“Bonus
Advance”), which will be an advance against Executive’s
first year performance bonus. In the event Executive’s first
year performance bonus is equal to or greater than $150,000, the
Company will be entitled to deduct the Bonus Advance against
amounts payable to Executive. Subject to the repayment obligations
described below, the Company will not seek reimbursement of the
Bonus Advance in the event Executive’s first year performance
bonus is less than $150,000.
(ii) Repayment . If, for any
reason, Executive’s employment by the Company is terminated
within 3 months of his initial start date, Executive agrees to
repay to the Company 100% of the Advance Bonus received by
Executive within 10 days of his termination date. If, for any
reason, Executive’s employment by the Company is terminated
after 3 months but before 6 months of Executive’s initial
start date, Executive agrees to repay to the Company 66.7% of the
Advance Bonus received by Executive within 10 days of his
termination date. If, for any reason, Executive’s employment
by the Company is terminated after 6 months but before 9 months of
Executive’s initial start date, Executive agrees to repay to
the Company 33.3% of the Advance Bonus received by Executive within
10 days of his termination date. In the event a Change of Control
(as defined in Section 10 below) occurs less than nine months
following Executive’s initial hire date, Executive will have
no obligation to repay any portion of the Advance Bonus.
(c) Options . The Company
will recommend at the first meeting of the Company’s Board of
Directors following Executive’s start date that the Company
grant Executive an option to purchase one million one hundred
thousand (1,100,000) shares of the Company’s Common
Stock at a price per share equal to the fair market value per share
of the Common Stock on the date of grant. Shares subject to such
option shall vest monthly over 48 months in equal monthly amounts
(with 1/48 th of such shares vesting each month,
commencing one month after the Effective Date), subject to
Executive’s continuing employment with the Company. This
option grant shall be subject to the terms and conditions of the
Company’s Senior Executive Stock Option Plan and Stock Option
Agreement (collectively the “Option Plan”). To the
extent possible under the Option Plan, the options shall be granted
as incentive stock options. No right to any stock is earned or
accrued until such time that vesting occurs, nor does the grant
confer any right to continue vesting or employment.
(d) Restricted Stock . The
Company will recommend at the first meeting of the Company’s
Board of Directors following Executive’s start date that the
Company grant Executive rights to purchase four hundred thousand
(400,000) shares of the Company’s Common Stock. Shares
subject to such rights shall vest quarterly over 4 years in equal
quarterly amounts (commencing one quarter after the Effective
Date), subject to Executive’s continuing employment with the
Company. This stock purchase right shall be subject to the terms
and conditions of the Company’s Senior Executive Stock Option
Plan and Stock Repurchase Right Agreement. No right to any stock is
earned or accrued until such life that vesting occurs, nor does the
grant confer any right to continue vesting or
employment.
-2-
5. Employee Benefits .
Executive will be eligible to participate in accordance with the
terms of all Company employee benefit plans, policies, and
arrangements that are applicable to other employees of the Company;
as such plans, policies, and arrangements may exist from time to
time, subject to the continued benefits described in Section 8
below. The Company may modify benefits from time to time as it
deems necessary. In addition, all officer compensation matters are
subject to Board Compensation Committee oversight.
6. Expenses . The Company
will reimburse Executive for all reasonable travel, entertainment,
and other expenses incurred by Executive in the furtherance of the
performance of Executive’s duties hereunder, in accordance
with the Company’s expense reimbursement policy as in effect
from time to time.
7. Termination of Employment
. In the event Executive’s employment with the Company
terminates for any reason, the Executive shall be entitled to
(a) all Base Salary accrued up to the effective date of
termination, (b) all pay for accrued, unused vacation that the
Company is legally obligated to pay Executive, if any, (c) all
benefits or compensation accrued prior to termination, as provided
under the terms of any employee benefit and compensation agreements
or plans applicable to the Executive, (d) exercise outstanding
stock options in accordance with the terms of the agreements
governing such equity awards, and (e) all business expenses
required to be reimbursed under the Company’s expense
reimbursement policy to the Executive with respect to business
expenses incurred prior to termination. For up to 12 months after
termination, Executive may retain his laptop (subject to the
Company’s security measures), cell phone, support and
voicemail. In addition, if the termination is by the Company
without Cause or by the Executive for Good Reason (as defined in
Section 10 below), he shall be entitled to the amounts and
benefits specified in Section 8; provided, however, that the
amounts specified in Section 8 will be reduced by amounts that
Executive is eligible to receive as severance under any other
Company plan, policy, or practice.
8. Severance .
( a)
Termination after Change of Control, Resignation for Good Reason
or Termination by Company Without Cause . In the event that
during the Employment Term, the Executive is terminated after a
Change of Control (as defined in Section 10 below), resigns
for Good Reason, or the Company terminates Executive’s
employment without Cause, Executive shall receive: (i) lump
sum payment of Executive’s Base Salary for twelve
(12) months, less applicable taxes (ii) a lump sum
payment of Executive’s bonus pursuant to his bonus plan in
effect on the termination date, (iii) full acceleration of
unvested equity compensation granted to Executive including,
without limitation, the options and restricted stock described in
Section 4(c) and (d) above, (iv) post termination
exercise of options for a period of twelve (12) months
following the date of Executive’s termination, and
(v) reimbursement for COBRA premiums, less Executive’s
normal monthly contribution, for Executive and Executive’s
eligible dependents, payable when such premiums are due, provided
Executive elects to continue medical coverage under applicable law
for a period of twelve (12) months, or until such date
Executive is no longer eligible for COBRA coverage or Executive
stops remitting normal monthly contribution.
(b) Resignation without Good
Reason or Termination for Cause . If Executive resigns without
Good Reason or if the Company terminates Executive’s
employment for
-3-
Cause, then, except as provided in
Section 7, (i) all further vesting of Executive’s
outstanding equity awards will terminate immediately, (ii) all
payments of Compensation by the Company to Executive hereunder will
terminate immediately and (iii) Executive will not be eligible
for severance or change of control benefits in accordance with this
Agreement.
(c) Termination due to Death or
Disability . If Executive’s employment terminates by
reason of death or Disability (as defined in Section 10
below), then, Executive will be entitled to receive benefits only
in accordance with the Company’s then established plans,
programs, and practices.
(d) 409A Compliance .
Notwithstanding subsections 8(a) and (b), to the extent required to
comply with Section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”), and only if the Company goes
public prior to Executive’s termination, during the first six
months after termination, Executive’s severance benefits will
accrue, payable in a lump sum payment on the second day of the
seventh month after termination.
(e) Sole Right to Severance .
This Agreement is intended to represent Executive’s sole
entitlement to severance payments and benefits in connection with
the termination of his employment.
9. Conditions to Receipt of
Severance . In the event that Executive becomes entitled to the
severance payments and accelerated vesting as described in
Section 8 above, such receipt of payments and accelerated
vesting will be conditioned on (i) such payments being subject
to all applicable tax withholding, (ii) Executive signing and
not revoking a separation agreement and release of claims similar
to the release set forth below, and (iii) Executive continuing
to comply with the non-solicitation, non-compete, and
non-disparagement agreements with the Company described under
“Non-Solicitation, Non-Competition and
Non-Disparagement” below.
(a) Release of Claims .
Executive acknowledges and agrees to execute a release identical in
substance to the release contained in this Section below, covering
the time period from the Effective Date through the last date of
employment under this Agreement; provided, however, the Parties
agree to modify the release to comply with any new laws which may
become applicable. If the Executive refuses to sign such a release,
the Executive shall be deemed to have failed to abide by the
material terms of this Agreement.
(b) Terms of Release . The
receipt of any severance benefits under this Agreement and the
Executive’s acceptance of the provisions of this Agreement
will be subject to the Executive agreeing that the foregoing
consideration represents settlement in full of all outstanding
obligations owed to Executive by the Company and its officers,
managers, supervisors, agents and employees. Executive, on behalf
of himself, his heirs, administrators, representatives, executors,
successors and assigns, and each of them, hereby release the
Company, its current and former stockholders, directors, officers,
employees, agents, attorneys, successors and assigns, and each of
them (the “Released Parties”) of and from any and all
claims, duties, obligations, actions
