OFFER OF EMPLOYMENTExecutive Employment Agreement |
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UNITED ONLINE INC | Theodore R. Cahall, Jr. | Classmates Online, Inc. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Search Executive Employment Agreement by:
Exhibit 10.15
July 21, 2005
Theodore R. Cahall, Jr.
25 Windward Hill
Oakland, CA 94618
Dear Ted,
This letter sets forth the terms and conditions of your employment with Classmates Online, Inc. and your appointment as an executive officer of United Online, Inc. (the “Company”).
1.
Position. You will serve in a full-time
capacity as Executive Vice President and Chief Operating Officer, Classmates
Online, Inc. You will also be designated as an executive officer of United
Online, Inc. with your title to initially be set at Executive Vice President,
Web Services, although this title may change as the Company’s business
evolves. Your employment with the Company will commence on August 9, 2005
(the “Commencement Date”). You will report to the Chief
Executive Officer of the Company.
2.
Salary and Benefits. You will be paid a salary
at the annual rate of $340,000, payable in bi-weekly installments in accordance
with the Company’s standard payroll practices, subject to any increases
as determined by the Board of Directors of the Company (the “Board of
Directors”) from time to time. You will be eligible to participate
in the Company’s employee benefits plans, including its 401(k)
plan. In addition, you will be entitled to participate in the
Company’s Exec-U-Care Medical Reimbursement Insurance Plan so long as
such plan is made generally available to the Company’s senior
executives. You will be entitled to 4 weeks of paid vacation each year,
pursuant to the Company’s standard vacation policy. The Company
will reimburse you for expenses incurred by you in connection with your
relocation from Oakland, California to the Seattle, Washington area to be
agreed upon.
3.
Bonus.
a.
Signing Bonus. Within seven (7) days
following the Commencement Date, you will receive a signing bonus (the
“Signing Bonus”) in an amount equal to $100,000. In the event
your employment with the Company is terminated prior to the one (1)-year
anniversary of the Commencement Date (i) by the Company “for cause”
(as defined below) or (ii) by you other than as a result of death,
“Disability” or for “good reason” (each term as defined
below), you will pay the Company the full amount of the Signing Bonus within
fourteen (14) days following the date of termination.
b.
Annual Bonus. For fiscal years 2005 and
2006, you will be eligible to participate in a bonus program with eligibility
for up to 100% of your annual base salary (prorated from the Commencement Date
for fiscal year 2005). The criteria for a bonus and the amount of such
bonus will be determined by the Board of Directors or a committee thereof.
4.
Stock Options; Restricted Stock Units.
a.
Stock Options. On or about the Commencement Date, you will be
granted an option to purchase 100,000 shares of the Company’s common
stock (the “Option”) with an exercise price equal to the fair
market value of the common stock on the date of grant. The Option will be
subject to the
standard terms and conditions of the applicable stock plan and the stock option agreement between you and the Company (copies of which have been provided to you) and the following four (4)-year vesting schedule based on your continued employment with the Company: 25% of the Option will vest on the one (1)-year anniversary of the Commencement Date and, thereafter, the remaining 75% will vest in equal monthly installments such that 100% will have vested by the four (4)-year anniversary of the Commencement Date.
b.
Restricted Stock Units. On August 15, 2005, you will be awarded
restricted stock units covering 100,000 shares of the Company’s common
stock (the “Restricted Stock Units”). The Restricted Stock
Units will be subject to the standard terms and conditions set forth in the
applicable stock plan and the restricted stock unit agreement between you and
the Company (copies of which have been provided to you) and the following four
(4)-year vesting schedule based on your continued employment with the Company:
25% of the underlying shares of the Company’s common stock will vest on
each one (1)-year anniversary of August 15, 2005 such that 100% will have
vested by the four (4)-year anniversary of such date. As more fully
addressed in the restricted stock unit agreement, outstanding restricted stock
units are entitled to receive regularly-scheduled cash dividends the Company
declares on its common stock. Dividends paid on Restricted Stock Units
are treated as ordinary income for tax purposes.
c.
Acceleration of Vesting. The standard provisions of the stock plan(s)
and related documents applicable to the Option and the Restricted Stock Units
will provide for certain vesting acceleration in the event of the termination
of your employment within the twelve (12)-month period following a change of
control of the Company.
5.
Policies; Procedures; Proprietary
Information and Inventions Agreement. As an employee of the Company, you will be expected
to abide by all of the Company’s policies and procedures. As a
condition of your employment, you agree to execute and abide by the terms of
the Proprietary Information and Inventions Agreement between you and the
Company, the Insider Trading Policy, the Code of Ethics and the Employee
Handbook.
6.
At Will Employment. Notwithstanding anything to
the contrary contained herein, your employment with the Company will be
“at will” and will not be for any specified term, meaning that
either you or the Company will be entitled to terminate your employment at any
time and for any reason, with or without cause. Any contrary
representations which may have been made to you are superseded by the terms set
forth in this paragraph. This is the full and complete agreement between
you and the Company on this subject. Although your job duties, title,
compensation and benefits, as well as the Company’s personnel policies
and procedures, may change from time to time, the “at will” nature
of your employment may only be changed in an express written agreement signed
by you and a duly authorized officer of the Company.
7.
Termination of Employment
a.
Termination by You. If you terminate your employment
with the Company for any reason, other than as a result of death or Disability or
for “good reason” (as defined below), all obligations of the
Company as set forth in this letter will cease, other than the obligation to
pay you for services rendered through the date of termination, to pay you for
any accrued but unused vacation days as of the date of termination, and to
fulfill its obligations with respect to your exercise of any vested stock
options in accordance with the terms of the applicable stock plan and option
agreement. If you terminate your employment with the Company for “good
reason” (as defined below), in addition to the foregoing,
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the Company will pay
you the Separation Payment subject to the conditions set forth in
Section 7(b) below. However, and notwithstanding the termination of
your employment by you, you will continue to be obligated to comply with the
terms of the Proprietary Information and Inventions Agreement and if
applicable, the noncompetition provision set forth in Section 9 below.
b.
Termination by the Company. If your employment is terminated by
the Company “without cause” (as defined below), and subject to the
signing of a standard mutually agreeable release of all employment-related
claims against the Company, its subsidiaries, and officers, directors, and
agents thereof, the Company will pay you a separation payment (the
“Separation Payment”) equal to (i) if such termination occurs prior
to the one (1)-year anniversary of the Commencement Date, an amount equal to
one year of your then current annual base salary (and, for the purpose of
clarification, the Company acknowledges that you will not be required to pay
back the Signing Bonus) or (ii) if such termination occurs after the one
(1)-year anniversary of the Commencement Date and prior to the two (2)-year
anniversary of the Commencement Date, an amount equal to one year of your then
current annual base salary plus the Annual Bonus (as defined
herein). For purposes of the immediately preceding sentence,
“Annual Bonus” means your then current annual base salary,
multiplied by the bonus percentage used to calculate the bonus awarded to you
for the immediately preceding year, and prorated through the date of
termination. This Separation Payment will be payable monthly on a pro
rata basis over twelve (12) months after such termination. Payment of
this Separation Payment will be contingent on your signing the standard release
of claims referred to above. Upon termination of your employment
“without cause,” other than the obligations set forth in the first
sentence of Section 7(a) above, the Company will have no further
obligation to you except pursuant to this paragraph.
If your employment is terminated by the Company “with cause” as defined below, the Company will have no further obligation to you under the terms of this letter, other than the obligations set forth in the first sentence of Section 7(a) above. However, and notwithstanding the termination of your employment by the Company “with cause” or “without cause,” or by you for “good reason,” you will continue to be obligated to comply with the terms of the Proprietary Information and Inventions Agreement and if applicable, the noncompetition provision set forth in Section 9 below.
You have the right decline to receive a portion of the benefits set forth under Sections 4 and 7 in the event that you determine that the provision of such benefits to you would result in a “parachute payment” as such term is defined in Section 280(G)(b)(2) of the Internal Revenue Code of 1986.
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