Exhibit 10.2
EMPLOYMENT
AGREEMENT
This EMPLOYMENT AGREEMENT is
effective as of March 3, 2009 by and between SHEILA TAN (the
“ Executive ”) and Align Technology, Inc.,
a Delaware corporation (the “ Company ”), with
effect as of the date resolved by the Board of Directors of Align
Technology, Inc. in a meeting held February 26, 2009,
that Executive’s appointment as an executive officer of the
Company is effective.
1.
Duties and Scope of Employment .
(a)
Position . For the term of the Executive’s
employment under this Agreement (“ Employment ”), the Company agrees
to employ the Executive in the position of Vice President,
Marketing and Chief Marketing Officer. The Executive shall
report to the Chief Executive Officer (the “
CEO ”). The
Executive accepts such employment and agrees to discharge all of
the duties normally associated with said position, and to
faithfully and to the best of Executive’s abilities perform
such other services consistent with Executive’s position as
Vice President, Marketing and Chief Marketing Officer as may from
time to time be assigned to Executive by the CEO.
(b)
Obligations to the Company . During the term of the
Executive’s Employment, the Executive shall devote
Executive’s full business efforts and time to the
Company. The Executive agrees not to actively engage in any
other employment, occupation or consulting activity for any direct
or indirect remuneration without the prior approval of the CEO,
provided, however, that the Executive may, without the approval of
the CEO, serve in any capacity with any civic, educational or
charitable organization. The Executive may own, as a passive
investor, no more than one percent (1%) of any class of the
outstanding securities of any publicly traded
corporation.
(c)
No Conflicting Obligations . The Executive represents
and warrants to the Company that Executive is under no obligations
or commitments, whether contractual or otherwise, that are
inconsistent with Executive’s obligations under this
Agreement. The Executive represents and warrants that the
Executive will not use or disclose, in connection with the
Executive’s employment by the Company, any trade secrets or
other proprietary information or intellectual property in which the
Executive or any other person has any right, title or interest and
that the Executive’s employment by the Company as
contemplated by this Agreement will not infringe or violate the
rights of any other person or entity. The Executive
represents and warrants to the Company that the Executive has
returned all property and confidential information belonging to any
prior employers.
2.
Cash and Incentive Compensation .
(a)
Salary . The Company shall pay the Executive as
compensation for the Executive’s services a base salary at a
gross annual rate of $275,000, payable in accordance with the
Company’s standard payroll schedule. The compensation
specified in this Subsection (a), together with any adjustments by
the Company from time to time, is referred to in this Agreement as
“Base Salary.”
(b)
Target Bonus . The Executive shall be eligible to
participate in an annual bonus program that will provide the
Executive with an opportunity to earn a potential annual bonus
equal to 60% of the Executive’s Base Salary. The amount
of the bonus shall be based upon the performance of the Executive,
as set by the individual performance objectives described in this
Subsection, and the Company in each calendar year, and shall be
paid by no later than January 31 of the following year,
contingent on the Executive remaining employed by the Company as of
such date. The Executive’s individual performance
objectives and those of the Company’s shall be set by the CEO
after consultation with the Executive by no later than
March 31, of each calendar year. Any bonus awarded or
paid to the Executive will be subject to the discretion of the
Board.
(c)
Incentive Awards . The Executive shall be eligible for
an annual incentive stock option grant and/or restricted stock unit
award subject to the approval of the Board in all respects,
including the terms described herein. The per share exercise
price of the option will be equal to the per share fair market
value of the common stock on the date of grant, as determined by
the Board of Directors. The term of such option shall be ten
(10) years, subject to earlier expiration in the event of the
termination of the Executive’s Employment. The
Executive shall vest in accordance with the vesting provisions
approved by the Compensation Committee of the Board of Directors,
which vesting is currently 25% of the option shares after the first
twelve (12) months of continuous service and shall vest in the
remaining option shares in equal monthly installments over the next
three (3) years of continuous service. Each restricted
stock unit award currently vests 25% on the one year anniversary of
the date of grant with 25% vesting yearly thereafter. The grant of
each such option and/or restricted stock unit shall be subject to
the other terms and conditions set forth in the Company’s
2005 Incentive Plan and in the Company’s standard form of
stock option agreement and restricted stock unit agreement, as
applicable.
3.
Vacation and Executive Benefits . During the term of
the Executive’s Employment, the Executive shall be eligible
to accrue 17 days vacation per year on a pro-rata basis throughout
the year, in accordance with the Company’s standard policy
for senior management, including provisions with respect to maximum
accrual, as it may be amended from time to time. During the
term of the Executive’s Employment, the Executive shall be
eligible to participate in any employee benefit plans maintained by
the Company for senior management, subject in each case to the
generally applicable terms and conditions of the plan in question
and to the determinations of any person or committee administering
such plan, and to the right of the Company to make changes in such
plans from time to time.
4.
Business Expenses . During the term of the
Executive’s Employment, the Executive shall be authorized to
incur necessary and reasonable travel, entertainment and other
business expenses in connection with her duties hereunder.
The Company shall reimburse the Executive for such expenses upon
presentation of an itemized account and appropriate supporting
documentation, all in accordance with the Company’s generally
applicable policies.
5.
Term of Employment .
(a)
Basic Rule . The Company agrees to continue the
Executive’s Employment, and the Executive agrees to remain in
Employment with the Company, from the commencement date set forth
in Section 1(d) until the date when the Executive’s
Employment terminates pursuant to Subsection (b) below.
The Executive’s Employment with the Company shall be
“at will,” and either the Executive or the Company may
terminate the Executive’s Employment at any time, for any
reason, with or without Cause. Any contrary representations,
which may have been made to the Executive shall be superseded by
this Agreement. This Agreement shall constitute
the
full and
complete agreement between the Executive and the Company on the
“at will” nature of the Executive’s Employment,
which may only be changed in an express written agreement signed by
the Executive and a duly authorized officer of the
Company.
(b)
Termination . The Company may terminate the
Executive’s Employment at any time and for any reason (or no
reason), and with or without Cause, by giving the Executive notice
in writing. The Executive may terminate the Executive’s
Employment by giving the Company fourteen (14) days advance notice
in writing. The Executive’s Employment shall terminate
automatically in the event of Executive’s death or Permanent
Disability. For purposes of this Agreement, “Permanent
Disability” shall mean that the Executive has become so
physically or mentally disabled as to be incapable of
satisfactorily performing the essential functions of
Executive’s position and duties under this Agreement for a
period of one hundred eighty (180) consecutive calendar
days.
(c)
Rights Upon Termination . Except as expressly provided
in Section 6, upon the termination of the Executive’s
Employment pursuant to this Section 5, the Executive shall
only be entitled to the compensation, benefits and reimbursements
described in Sections 2, 3 and 4 for the period preceding the
effective date of the termination. The payments under this
Agreement shall fully discharge all responsibilities of the Company
to the Executive.
(d)
Termination of Agreement . The termination of this
Agreement shall not limit or otherwise affect any of the
Executive’s obligations under Section 7.
6.
Termination Benefits .
(a)
General Release Agreement . Any other provision of
this Agreement notwithstanding, Subsections (b), (c) or
(d) below shall not apply unless the Executive (i) has,
within the time prescribed by the Company, executed a General
Release Agreement in a form prescribed by the Company by which the
Executive waives and releases with irrevocable effect all known and
unknown claims that the Executive may then have against the Company
or persons affiliated with the Company which are waivable under
applicable law, and (ii) pursuant to such General Release
Agreement has agreed not to prosecute any legal action or other
proceeding based upon any of such claims to the full extent
permissible under applicable law, and (iii) pursuant to such
General Release Agreement has acknowledged Executive’s
continuing obligations under this Agreement and the Proprietary
Information and Inventions Agreement referenced below.
(b)
Termination without Cause . If, during the term of
this Agreement, and not in connection with a Change of Control as
addressed in Subsection (c) below, the Company terminates
Executive’s Employment without Cause or the Executive resigns
for Good Reason, then:
(i)
as of the date of termination of Employment, Executive shall
immediately conditionally vest in an additional number of shares
under all outstanding options and restricted stock units as if the
Executive had performed twelve (12) additional months of service,
subject to Executive’s execution of the General Release
Agreement described above with irrevocable effect and suspension of
exercise rights with respect to such conditionally vested shares
until such execution;
(ii)
the Company shall pay the Executive, in a lump sum upon the
effectiveness of the General Release to be executed by Executive in
accordance with Section 6(a) above, an amount equal
to: (x) the then current year’s Target Bonus
prorated for the number of
days of Executive is employed in
said year; (y) one year’s Base Salary; and (z) the
greater of the then current year’s Target Bonus or the actual
prior year’s bonus. The Executive’s Base Salary
shall be paid at the rate in effect at the time of the termination
of Employment.
(c)
Upon a Change of Control . In the event of the occurrence of
a Change in Control while the Executive is employed by the
Company:
(i)
the Executive shall immediately vest in an additional number of
shares under all outstanding options and restricted stock units as
if the Executive had performed twelve (12) additional months of
service; and
(ii)
if within twelve (12) months following the occurrence of the Change
of Control, one of the following events occurs:
(A) the Executive’s
employment is terminated by the Company without Cause;
or
(B) the Executive resigns for
Good Reason
then the Executive shall
immediately conditionally vest as to all shares under all
outstanding options and restricted stock units, subject to
Executive’s execution of the General Release Agreement
described above with irrevocable effect and suspension of exercise
rights with respect to
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