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EXECUTIVE EMPLOYMENT AGREEMENT

Employment Agreement

EXECUTIVE EMPLOYMENT AGREEMENT | Document Parties: Kintera, Inc You are currently viewing:
This Employment Agreement involves

Kintera, Inc

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Title: EXECUTIVE EMPLOYMENT AGREEMENT
Governing Law: California     Date: 8/9/2007
Industry: Software and Programming     Sector: Technology

EXECUTIVE EMPLOYMENT AGREEMENT, Parties: kintera  inc
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Exhibit 10.3

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (“Agreement”), dated August 1, 2007 (“Effective Date”), is between Kintera, Inc., a Delaware corporation (the “Company”) and Richard LaBarbera (“Executive”).

WHEREAS, the Company and Executive have previously executed an Offer Letter dated January 23, 2006 (the “Offer Letter”) regarding the terms of Executive’s employment with the Company.

WHEREAS, the Company and Executive desire this Agreement to be to be the final, complete, and exclusive statement of the terms of Executive’s employment by the Company, superseding the terms of such Offer Letter.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1. POSITION, RESPONSIBILITIES, AND TERM

a. Position. Executive is employed by the Company to render services to the Company in the position of President and Chief Executive Officer. Executive shall perform such duties and responsibilities as are normally related to such position in accordance with the standards of the industry and any additional duties now or hereafter assigned to Executive by the Company’s Board of Directors (“Board”) (“Services”). Executive shall abide by the rules, regulations, and practices as adopted or modified from time to time in the Company’s sole discretion. Executive will devote Executive’s full time efforts to the provision of Services under this Agreement.

b. Other Activities. Except upon the prior written consent of the Company, Executive will not, during the term of this Agreement: (i) be employed elsewhere; (ii) engage, directly or indirectly, in any other business activity (whether or not pursued for pecuniary advantage) that might interfere with Executive’s duties and responsibilities hereunder or create a conflict of interest with the Company; or (iii) acquire any interest of any type in any other business which is in competition with the Company, provided, however, that the foregoing shall not be deemed to prohibit the Executive from acquiring solely as an investment up to five percent (5%) of the outstanding equity interests of any publicly-held company.

c. No Conflict. Executive represents and warrants that Executive’s execution of this Agreement and performance of Services under this Agreement will not violate any obligations Executive may have to any other employer, person or entity, including any obligations to keep in confidence proprietary information, knowledge, or data acquired by Executive in confidence or in trust prior to becoming an employee of the Company.

 


d. Term of Employment . Unless earlier terminated in accordance with Section 3, the term of this Agreement shall be for a period of three (3) years after the Effective Date of this Agreement (“Term”). Where the Agreement is terminated on or after the expiration of the Term, the Company shall pay to Executive all compensation to which Executive is entitled up through the effective date of termination according to its normal payroll practices, and the Company shall not have any further obligations under this Agreement.

e. Housing Allowance . Until the earlier of the date on which Executive ceases to be employed by the Company or December 31,2009, the Company will continue to reimburse Executive for documented costs and expenses actually incurred by Executive directly in connection with his maintenance of a residence in San Diego, provided that Executive does not sell his primary residence in Pleasonton, CA (the “Primary Residence”). The maximum yearly amount for reimbursable expenses covered by this paragraph shall not exceed $18,000 for calendar year 2007; $20,000 for calendar year 2008; and $22,000 for calendar year 2009. All such reimbursements (and limits thereto) shall be increased (“grossed-up”) to the extent necessary to cover any personal income taxes Executive incurs by reason of such payments. Any amounts paid hereunder shall reduce the amounts available under Section 1(f) below.

f. Relocation . In the event that Executive (a) sells the Primary Residence in connection with the relocation of his primary residence to San Diego County or (b) acquires property in San Diego County to serve as his new principal residence (the “New Residence”), the Company will cease making the payments under 1(e) above, but instead shall reimburse Executive for the following (provided that in no event shall the aggregate of all such relocation reimbursements exceed $96,000 , after reductions to the extent paid pursuant to 1(e)), subject to Section 1(g) as follows: (i) either (x) the real estate commissions on the sale of the Primary Residence (not to exceed 4% of the sale price of the Primary Residence) or (y) the portion of the purchase price of the New Residence attributable to real estate commissions (not to exceed 4% of the purchase price of the New Residence); (ii) the shipping cost of household goods through an approved relocation service; and (iii) hotel and mileage or one way airfare for Executive and Executive’s family on the day of move.

g. Refund Provision. Executive hereby agrees to refund to the Company 100% of all payments that were made to you or on your behalf in connection with your relocation (but not you housing allowance), should Executive resign or if Executive’s employment is terminated for Cause during the twelve month period following the sale of the Primary Residence.

 

2. COMPENSATION AND BENEFITS

h. Base Salary. In consideration of the Services to be rendered under this Agreement, the Company shall pay Executive a gross salary at the rate of Three Hundred Thirty Thousand Dollars ($330,000) per year, less applicable withholdings (“Base Salary”). The Base Salary shall be paid in accordance with the Company’s normal payroll practices. Executive’s Base Salary will be reviewed from time to time in accordance with the established procedures of the Company for adjusting salaries for similarly situated employees and may be adjusted in the sole discretion of the Company.

 


i. Annual Bonus. In further consideration of the Services to be rendered under this Agreement, Executive shall be eligible to receive an annual bonus of up to seventy percent (70%) of Executive’s Base Salary based on achievement of goals and objectives established by the Company (“Annual Bonus”). Executive must remain employed with the Company through the end of the calendar year at issue in order to be eligible to receive the Annual Bonus, and the Annual Bonus will be paid to Executive on or before March 15 of the calendar year following any calendar year in which Executive earns an Annual Bonus. Executive’s Annual Bonus will be reviewed from time to time in accordance with the established procedures of the Company for adjusting bonuses for similarly situated employees and may be adjusted in the sole discretion of the Company.

j. Employment Benefits Plans. In further consideration of the Services to be rendered under this Agreement, Executive will be entitled to participate in pension, profit sharing and other retirement plans, incentive compensation plans, group health, hospitalization and disability or other insurance plans, and other employee welfare benefit plans generally made available to other similarly-situated employees of the Company, in accordance with the benefit plans established by the Company, and as may be amended from time to time in the Company’s sole discretion.

k. Vacation . Executive shall be eligible to receive paid vacation subject to the policies and procedures in the Company’s Employee Handbook, as may be amended from time to time in the Company’s sole discretion.

l. Expenses. The Company will pay or reimburse Executive for all normal and reasonable travel and entertainment expenses incurred by Executive in connection with Executive’s responsibilities to the Company upon submission of proper vouchers and documentation in accordance with the Company’s expense reimbursement policy.

 

3. AT-WILL EMPLOYMENT

The employment of Executive shall be “at-will” at all times. The Company or Executive may terminate Executive’s employment with the Company at any time, without any advance notice, for any reason or no reason at all, notwithstanding anything to the contrary contained in or arising from any statements, policies or practices of the Company relating to the employment, discipline or termination of its employees. Following the termination of Executive’s employment, the Company shall pay to Executive all compensation to which Executive is entitled up through the date of termination. Thereafter, all obligations of the Company under this Agreement shall cease other than those set forth in Section 4.

 


4. COMPANY TERMINATION OBLIGATIONS

a. Termination by Company for Cause. Where the Company terminates Executive’s employment for Cause, all obligations of the Company under this Agreement shall cease, other than those set forth in Section 3. For purposes of this Agreement, “Cause” shall mean: (i) the Executive’s theft, dishonesty, or falsification of any Company documents or records; (ii) the Executive’s improper use or disclosure of the Company’s confidential or proprietary information; (iii) any action by the Executive which has a detrimental effect on the Company’s reputation or business; (iv) the Executive’s failure or inability to perform adequately any reasonable assigned duties as determined by the Company; (v) any violation by the Executive of any material agreement (including this Agreement) between the Executive and the Company, which breach is not cured to the extent that the applicable agreement provides for a cure period, or any breach of any material Company policy or material statutory duty to the Company; or (vi) the Executive’s conviction (including any plea of guilty or nolo contendere) of any felony or crime involving moral turpitude or dishonesty.

b. Termination by Company without Cause. Where the Company terminates Executive’s employment without Cause, and Executive’s employment is not terminated due to death or Disability (as defined below), Executive will be eligible to receive: (i) continued payment of Executive’s then-monthly Base Salary for twelve (12) months according to the Company’s normal payroll practices, less applicable withholdings and any renumeration received by Executive because of Executive’s employment or self-employment during the twelve (12) month period; and (ii) continued eligibility to participate in medical, life, dental and disability insurance coverage for Executive and his eligible dependents to the extent permitted under the applicable plans of the Company as in effect on the date of such termination, at the Company’s expense for twelve (12) months, provided , however , that after such termination Executive shall continue to pay premiums in respect to such coverage to the same extent as was the case immediately prior to such termination. Executive’s eligibility to receive the severance set forth in this Section 4(b) is conditioned on Executive having first signed a release agreement in the form attached as Exhibit A . Upon satisfaction of the Company’s obligations under this Section 4(b), all other obligations of the Company under this Agreement shall cease.

c. Termination without Cause or Resignation for Good Reason in Connection with Change in Control. Notwithstanding anything to the contrary in this Agreement, if within the period two months prior to and two years following a “Change in Control” Executive voluntarily resigns for “Good Reason” or Executive’s employment is terminated by the Company without Cause, and Executive’s employment is not terminated due to death or Disability, then in lieu of receiving the amounts set forth in Section 4(b) hereof, the Executive will be eligible to receive: (i) in a lump sum in immediately available funds within fifteen (15) business days after the date of termination, an amount equal to the sum of (A) Executive’s annual Base Salary in effect at the time of termination and (B) the maximum Annual Bonus for which Executive is eligible at the time of termination, calculated based upon the bonus period in which the termination occurs; (ii) continued eligibility to participate in medical, life, dental and disability insurance coverage for

 


Executive and his eligible dependents to the extent permitted under the applicable plans of the Company as in effect on the date of such termination, at the Company’s expense for twelve (12) months; and (iii) any unvested shares of restricted stock, unvested options or other equity-based compensation awards held by Executive automatically shall become 100% vested. Executive’s eligibility to receive the severance set forth in this Section 4(c) is conditioned on Executive having first signed a release agreement in the form attached as Exhibit A . Upon satisfaction of the Company’s obligations under this Section 4(c), all other obligations of the Company under this Agreement shall cease.

1. For purposes of Section 4(c),”Good Reason” shall mean any one or more of the following: (i) without the Executive’s express written consent, the relocation of the principal place of the Executive’s Service to a location that is more than fifty (50) miles from the Executive’s principal place of Service immediately prior to the date of the Change in Control; (ii) any failure by the Company to pay, or any reduction by the Company of the Executive’s Base Salary in effect immediately prior to the date of the Change in Control; (iii) any failure by the Company to (1) continue to provide to the Executive a package of welfare benefit plans that, taken as a whole, provide substantially similar benefits to those to which the Executive was entitled immediately prior to the Change in Control (except that the Executive’s contributions may be increased to the extent of any cost increases imposed by third parties) or (2) provide the Executive with all other fringe benefits (or their equivalent) from time to time in effect for the benefit of any employee of the Company; or (iv) a change in Executive’s position with the Company which materially reduces Executive’s level of responsibility.

2. For purposes of Section 4(c), the term “Change in Control” shall have the meaning set forth in the Company’s 2003 Equity Incentive Plan.

d. Termination Due to Disability. Executive’s employment shall terminate automatically if Executive becomes Disabled. Executive shall be deemed Disabled if Executive is unable for medical reasons to perform Executive’s essential job duties for either ninety (90) consecutive calendar days or one hundred twenty (120) business days in a twleve (12) month period and, within thirty (30) days after a notice of termination is given to Executive, Executive has not returned to work. If Executive’s employment is terminated by the Company due to Executive’s Disability, all obligations of the Company under this Agreement shall cease, other than those set forth in Section 3.

e. Termination Due to Death. Executive’s employment shall terminate automatically upon Executive’s death. If Executive’s employment is terminated due to Executive’s death, all obligations of the Company under this Agreement shall cease, other than those set forth in Section 3.

f. Executive’s Resignation . Where Executive resigns Executive’s employment undercircumstances other than those governed by Section 4(c), all obligations of the Company under this Agreement shall cease, other than those set forth in Section 3.

 


g. Delayed Payments . In the event that Section 409A (“409A”) of the Internal Revenue Code of 1986, as amended (the “Code”), applies to any compensation with respect to Executive’s termination, payment of that compensation shall be delayed if Executive is a “specified employee,” as defined in 409A(a)(2)(B)(i), and such delayed payment is required by 409A. Such delay shall last six (6) months from the date of Executive’s termination. On the day following the end of such six-month period, the Company shall make a catch-up payment to Executive equal to the total amount of such payments that would have been made during the six-month period but for this Section 4(g).

 

5. EXECUTIVE TERMINATION OBLIGATIONS

a. Return of Property. Executive agrees that all property (including without limitation all equipment, tangible proprietary information, documents, records, notes, contracts and computer-generated materials) furnished to or created or prepared by Executive incident to Executive’s employment belongs to the Company and shall be promptly returned to the Company upon termination of Executive’s employment.

b. Resignation and Cooperation. Upon termination of Executive’s employment, Executive shall be deemed to have resigned from all offices and directorships then held with the Company, including, without limitation, his position as a member of the Board. Following any termination of employment, Executive shall cooperate with the Company in the winding up of pending work on behalf of the Company and the orderly transfer of work to other employees. Executive shall also cooperate with the Company in the defense of any action brought by any third party against the Company that relates to Executive’s employment by the Company.

c. Continuing Obligations. Executive understands and agrees that Executive’s obligations under Sections 6 and 12 herein (including Exhibit B ) shall survive the termination of Executive’s employment for any reason and the termination of this Agreement.

 

6. INVENTIONS AND PROPRIETARY INFORMATION

Executive has previously signed and agrees to be bound by the terms of the Employee Innovations and Proprietary Rights Assignment Agreement, which is attached as Exhibit B (“Proprietary Information Agreement”).

 

7. AMENDMENTS; WAIVERS; REMEDIES

This Agreement may not be amended or waived except by a writing signed by the parties hereto. Failure to exercise any right under this Agreement shall not constitute a waiver of such right. Any waiver of any breach of this Agreement shall not operate as a waiver of any subsequent breaches. All rights or remedies specified for a party herein shall be cumulative and in addition to all other rights and remedies of the party hereunder or under applicable law.

 


8. ASSIGNMENT; BINDING EFFECT

a. Assignment. The performance of Executive is personal hereunder, and Executive agrees that Executive shall have no right to assign and shall not assign or purport to assign any rights or obligations under this Agreement. This Agreement may be assigned or transferred by the Company; and nothing in this Agreement shall prevent the consolidation, merger or sale of the Company or a sale of any or all or substantially all of its assets.

b. Binding Effect. Subject to the foregoing restriction on assignment by Executive, this Agreement shall inure to the benefit of and be binding upon each of the parties; the affiliates, officers, directors, agents, successors and assigns of the Company; and the heirs, devisees, spouses, legal representatives and successors of Executive.

 

9. NOTICES

All notices or other communications required or permitted hereunder shall be made in writing and shall be deemed to have been duly given if delivered: (a) by hand; (b) by a nationally recognized overnight courier service; or (c) by United States first class registered or certified mail, return receipt requested, to the principal address of the other party, as set forth below. The date of notice shall be deemed to be the earlier of (i) actual receipt of notice by any permitted means, or (ii) five business days following dispatch by overnight delivery service or the United States Mail. Executive shall be obligated to notify the Company in writing of any change in Executive’s address. Notice of change of address shall be effective only when done in accordance with this paragraph.

Company’s Notice Address:

Kintera, Inc.

9605 Scranton Road, Suite 200

San Diego, California 92121

Executive’s Notice Address:

1619 Orvieto Court

Pleasanton, CA 94566

 

10. SEVERABILITY

If any provision of this Agreement shall be held by a court or arbitrator to be invalid, unenforceable, or void, such provision shall be enforced to the fullest extent permitted by law, and the remainder of this Agreement shall remain in full force and effect. In the event that the time period or scope of any provision is declared by a court or arbitrator of competent

 


jurisdiction to exceed the maximum time period or scope that such court or arbitrator deems enforceable, then such court or arbitrator shall reduce the time period or scope to the maximum time period or scope permitted by law.

 

11. TAXES

All amounts paid under this Agreement shall be paid less all applicable state and federal tax withholdings and any other withholdings required by any applicable jurisdiction.

 

12. GOVERNING LAW; VENUE

a. This Agreement shall be governed by and construed in accordance with the laws of the State of California , and Executive hereby expressly consents to the personal jurisdiction of the state and federal courts located in San Diego, California for any lawsuit arising from or relating to this Agreement.

b. The parties agree that any dispute, controversy or claim, whether based on contract, tort, statute, discrimination, retaliation or otherwise, relating to, arising from or connected in any manner to this Agreement, or to the alleged breach of this Agreement, or arising out of or relating to Executive’s employment or termination of employment, shall, upon timely written request of either party be submitted to and resolved by binding arbitration. The arbitration shall be conducted in San Diego, California. The arbitration shall proceed in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association (“AAA”) in effect at the time the claim or dispute arose, unless other rules are agreed upon by the parties. Unless otherwise agreed to by the parties in writing, the arbitration shall be conducted by one arbitrator who is a member of the AAA and who is selected pursuant to the methods set out in the National Rules for Resolution of Employment Disputes of the AAA. Any claims received after the applicable/relevant statute of limitations period has passed shall be deemed null and void. The award of the arbitrator shall be a reasoned award with findings of fact and conclusions of law. Either party may bring an action in any court of competent jurisdiction to compel arbitration under this Agreement, to enforce an arbitration award and to vacate an arbitration award. However, in actions seeking to vacate an award, the standard of review to be applied by said court to the arbitrator’s findings of fact and conclusions of law will be the same as that applied by an appellate court reviewing a decision of a trial court sitting without a jury. The Company will pay the fees of the arbitrator to the extent required by law. Each party will pay its own attorneys’ fees and other costs incurred by their respective attorneys.

 

13. INTERPRETATION

This Agreement shall be construed as a whole, according to its fair meaning, and not in favor of or against any party. Sections and section headings contained in this Agreement are for

 


reference purposes only, and shall not affect in any manner the meaning or interpretation of this Agreement. Whenever the context requires, references to the sing


 
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