Exhibit 10.9
EMPLOYMENT
AGREEMENT
This EMPLOYMENT AGREEMENT
(“Agreement”) is entered into as of May 10, 2006,
by and between Services Acquisition Corp. International (the
“Company”) (to be renamed Jamba, Inc. upon consummation
of the merger between JJC Acquisition Company and Jamba Juice
Company, pursuant to that certain Agreement and Plan of Merger,
dated as of March 10, 2006, by and among the Company, JJC
Acquisition Company and Jamba Juice Company (the “Merger
Agreement”)), and Karen Kelley, an individual resident of the
State of California (the “Employee”). Capitalized terms
used herein but not otherwise defined herein shall have their
respective meanings as set forth in the Merger
Agreement.
In consideration of the mutual
representations, warranties, covenants and agreements contained in
this Agreement, the parties hereto agree as follows:
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1)
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Employment;
Term; Compensation .
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a)
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Employment . Employee’s employment with the Company,
and this Agreement, will only become effective upon Closing of the
Merger Agreement. Upon Closing (such date of Closing referred to as
the “Effective Date”), the Company agrees to employ the
Employee as an employee of the Company, and the Employee agrees to
accept such employment and serve as an employee of the Company,
subject to the terms and conditions of this Agreement.
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b)
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Term .
The period during which the Employee shall serve as an employee of
the Company shall commence on the Effective Date and, unless
earlier terminated pursuant to this Agreement, shall expire on the
third anniversary of the Effective Date (the “Initial
Term”) provided that this Agreement shall automatically
extend for one or more additional twelve month periods (each an
“Additional Term,” the Initial Term and any Additional
Term, collectively referred to as the “Term”) unless
either party delivers written notice of cancellation to the other
party at least 120 days prior to expiration of the then current
term.
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c)
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Duties and
Responsibilities . During
the Term, the Employee shall have such authority and responsibility
and perform such duties as may reasonably be assigned to the
Employee from time to time at the direction of the Board of
Directors of the Company (the “Board”), and in the
absence of such assignment, such duties customary to
Employee’s position as are necessary to the business and
operations of the Company. During the Term, the Employee’s
employment shall be full time in the Company’s (or Jamba
Juice Company’s) San Francisco bay area support center. The
Employee shall perform Employee’s duties honestly,
diligently, competently, in good faith and in the best interests of
the Company and shall use Employee’s best efforts to promote
the interests of the Company.
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d)
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Compensation . In consideration of the Employee’s
services hereunder and compliance with the restrictive covenants
and other obligations imposed on the Employee in this Agreement,
the Employee shall be paid compensation
(“Compensation”) as follows:
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(i)
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an annual base
salary of $265,000 (the “Salary”), payable in
accordance with the Company’s customary payroll practices,
which Salary will be reviewed annually by the Compensation
Committee of the Board;
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(ii)
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a target bonus
of up to 50% of Employee’s Salary for the 2007 fiscal year of
Jamba Juice Company, based on targets reasonably established by the
Board (or the appropriate committee thereof) and communicated to
Employee within 90 days following the Effective Date. Thereafter
any annual bonus shall be as determined in good faith by the
Compensation Committee of the Board. The payment of any such
bonuses will be made within 90 days after the close of the Jamba
Juice Company fiscal year, but in no event prior to receipt by the
Company of its annual audited financial statements;
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(iii)
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(A) an
initial option grant of 175,000 shares, made at the Effective Date,
with a strike price equal to the fair market value of the
Company’s common stock at the date of grant as defined in the
Company’s 2006 Employee, Director and Consultant Stock Plan
(the “Plan”) (the “Initial Option Grant”).
Following the Initial Option Grant, any other grants of options or
restricted stock to the Employee, and the terms and conditions
thereof, will be determined by the Board (or appropriate committee
thereof), and (B) an initial restricted stock grant of 27,500
shares with equal annual vesting over a four year period (the
“Initial Restricted Stock Grant”). Following the
Initial Option Grant and Initial Restricted Stock Grant, any other
grants of options or restricted stock to the Employee, and the
terms and conditions thereof, will be determined by the Board (or
appropriate committee thereof); and
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(iv)
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all options and
restricted stock granted pursuant to Id) (iii) above shall be
100% vested upon termination without cause pursuant to
Section 2)b or a Change of Control that occurs prior to the
first anniversary of the Effective Date. For purposes of this
Agreement Change of Control is defined as (a) a sale of
substantially all of the assets of the Company, (b) a merger
of or consolidation with an unaffiliated third party in which the
Company is not the surviving corporation (c) a reverse merger
with an unaffiliated third party in which the Company is the
surviving corporation but the shares of common stock of the Company
outstanding immediately preceding the merger are converted by
virtue of the merger into other property, or (d) an
acquisition by any person, entity or group within the meaning of
Section 13 (d) or 14(d) of the Securities Exchange Act of
1934, as amended (“Exchange Act”) or any comparable
successor provisions (excluding any employee benefit plan, or
related trust, sponsored or maintained by the company) of the
beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act, or comparable successor rule) of securities
of the Company representing at least fifty percent (50%) of
the combined voting power entitled to vote in the election of
directors of the Board. All options and restricted stock granted
pursuant to Id) (iii) above shall also be governed by the
terms of the Plan.
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e)
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Benefits . Employee shall be entitled to participate, in
any vacation, relocation, retirement, deferred compensation,
medical, prescription drug, dental, vision, disability, employee
life, group life, accidental death or travel accident insurance
benefits or any other benefit that the Company may adopt for the
benefit of similarly situated executive employees, in accordance
with the terms of such plan.
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f)
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Expense
Reimbursement. The
Company shall reimburse Employee for all authorized expenses
reasonably incurred or paid by Employee in connection with the
performance of Employee’s services under this Agreement upon
presentation of expense statement or vouchers and such other
supporting information as the Company may from time to time
reasonably require or request.
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g)
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No Other
Compensation or Benefits; Payment . The compensation and benefits specified in
this Section 1 of this Agreement shall be in lieu of any and
all other compensation and benefits. Payment of all compensation
and benefits to Employee hereunder shall be made in accordance with
the relevant Company policies in effect from time to time,
including normal payroll practices, and shall be subject to all
applicable employment and withholding taxes.
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a)
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Death,
Disability and Cause . At
any time during the Term, the Company shall have the right to
terminate the Term and to discharge the Employee for Cause (as
herein defined) effective upon delivery of written notice to the
Employee. Upon any such termination by the Company for Cause, the
Employee or the Employee’s legal representatives shall be
entitled to that portion of the unpaid Compensation through the
date of termination, and the Company shall have no further
obligations hereunder from and after the date of such termination.
Termination for “Cause” shall mean termination because
of (i) the Employee’s breach of any of the
Employee’s covenants contained in Sections 3, 4, 5 and/or 8
of this Agreement or breach of any representation or warranty in
this Agreement, (ii) the Employee’s failure or refusal
to perform any of the reasonably assigned duties or
responsibilities required to be performed by the Employee under the
terms of this Agreement, provided that the Employee has first
received from a duly authorized representative of the Board written
notice that describes in detail such failure or refusal and that
the Employee be given a period of thirty 30 days after receipt to
correct or cure such failure or refusal, provided that the
occurrence of a second violation similar in nature to a prior
violation which was cured following notice from the Company shall
constitute “Cause” immediately upon notice without any
further opportunity to cure, (iii) the Employee’s gross
negligence or willful misconduct in the performance of the
Employee’s duties hereunder, (iv) the Employee’s
commission of an act of dishonesty affecting the Company or the
commission of an act constituting fraud or a felony, , (v) the
Employee’s death or (vi) the Employee’s inability
to perform any of the Employee’s duties or responsibilities
as provided in this Agreement due to the Employee’s physical
or mental disability or illness extending for, or reasonably
expected to extend for, greater than sixty (60) days (as
determined in good faith by the Board). If the Employee shall
resign or otherwise terminate the Employee’s employment with
the Company, either expressly or by abandonment, the Employee shall
be deemed for purposes of this Agreement to have been terminated
for Cause.
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b)
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Without Cause
. At any time during the Term, the
Company shall have the right to terminate the Term and to discharge
the Employee without Cause effective upon delivery of written
notice to the Employee. Upon any such termination by the Company
without Cause, the Employee shall be entitled to receive any unpaid
portion of the Employee’s Compensation and un-reimbursed
expenses in accordance with Section 1(f) payable when and as
the same would have been due and payable hereunder but for such
termination. If the Company terminates Employee’s employment
without Cause at any time during the Term, then the Company shall
also
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continue to pay Employee, as
severance, Salary for a period of twelve (12) months following
the date of termination (“Severance Period”). In
addition, if at any time during the Severance Period the Employee
was entitled to receive a bonus as set forth in this Agreement, the
Company shall also pay to Employee the bonus to which Employee.
would have been entitled had Employee remained employed with the
Company. All benefits shall, unless otherwise provided by Company
policy applicable to its employees generally or otherwise required
by law, terminate on the date of termination.
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c)
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Notwithstanding
any other provision with respect to the timing of payments under
this Section 2, if, at the time of the Employee’s
termination, the Employee is deemed to be a “specified
employee” (within the meaning of Section 409A of the
Code, and any successor statute, regulation and guidance thereto)
of the Company, then only to the extent necessary to comply with
the requirements of Section 409A of the Code, any payments to
which the Employee may become entitled under this Section 2
which are subject to Section 409A of the Code (and not
otherwise exempt from its application) will be withheld until the
first business day of the seventh month following the termination
of the Employee’s employment, at which time the Employee
shall be paid an aggregate amount equal to six months of payments
otherwise due to the Employee under the terms of this
Section 2, as applicable. After the first business day of the
seventh month following the termination of the Employee’s
employment and continuing each month thereafter, the Employee shall
be paid the regular payments otherwise due to the Employee in
accordance with the terms of this Section 2, as
applicable.
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a)
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In
consideration of the foregoing, the Employee agrees that during the
Term and for a period of one (1) year following termination of
the Term for any or no reason, the Employee shall not directly or
indirectly:
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i)
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induce any
customer, franchisee or licensee of any of the Employer Companies
(as herein defined) to patronize any business that is directly or
indirectly in competition with the Protected Business (as herein
defined) conducted by any of the Employer Companies;
(B) canvass or solicit from any person or entity which is a
franchisee or licensee of the Protected Business conducted by any
of the Employer Companies, any such competitive business; or
(C) request or advise any customer, supplier, franchisee or
licensee of the Protected Business conducted by any of the Employer
Companies to withdraw, curtail or cancel any such customer’s,
franchisee’s or licensee’s business with any of the
Employer Companies; and/or
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ii)
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employ or
engage any person who serves in a managerial capacity who is then
employed or engaged by any of the Employer Companies or who was
within the six-month period prior thereto employed or engaged by
any of the Employer Companies, or in any manner seek to induce any
employee or independent contractor of any of the Employer Companies
to leave its, his or her employment or engagement.
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b)
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“Protected Business”
Defined . As used in this
Agreement, the term “Protected Business” means the
business of owning, operating, franchising or licensing any
business that provides any or all of the following:
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i)
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the retailing
of fruit smoothies, juices, blended beverages and healthy
snacks;
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or
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ii)
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the wholesale
sale or distribution of fruit smoothies, juices,
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