Exhibit 10.5
CELEBRATE EXPRESS, INC.
FORM OF SEVERANCE AGREEMENT
This Severance Agreement (the “
Agreement ”) is dated as of MARCH 13, 2008 by
and between DENNIS EVERHART, KRISTOPHER GALVIN and LISA
TUTTLE (“ Employee ”) and Celebrate Express,
Inc., a Washington corporation (the “ Company
”).
1. At-Will
Employment . The Company and Employee acknowledge
that Employee’s employment is and shall continue to be
at-will, as defined under applicable law, and that Employee’s
employment with the Company may be terminated by either party at
any time for any or no reason. If Employee’s employment
terminates for any reason, Employee shall not be entitled to any
payments, benefits, damages, award or compensation other than as
provided in this Agreement or under applicable law. The rights and
duties created by this Section 1 may not be modified in any
way except by a written agreement executed by Employee and the
Chief Executive Officer of the Company.
The
rights, benefits and obligations set forth herein supercede and
replace any and all agreements between the Company and Employee
regarding post-termination benefits and any other benefits or
payments to Employee from the Company in connection with the
termination of employment.
2. Severance
Benefits . Employee shall be entitled to receive
severance benefits upon termination of employment only as set forth
in this Section 2:
(a)
Voluntary Termination . If Employee
voluntarily terminates his/her employment with the Company (under
circumstances other than a Constructive Termination), then Employee
shall not be entitled to receive payment of any severance benefits.
Employee will receive payment(s) for all salary, sales-related
compensation (as applicable) and unpaid vacation accrued as of the
date of Employee’s termination of employment and
Employee’s benefits will be continued under the
Company’s then existing benefit plans and policies in
accordance with such plans and policies in effect on the date of
termination and in accordance with applicable law.
(b)
Termination Resulting from a Change in Control
. If, in connection with or within 6 months following a
Change in Control (as defined below) that occurs during the term of
this Agreement, Employee’s employment is terminated
(1) by the Company or its successor without Cause, or
(2) by Employee under circumstances constituting a
Constructive Termination ((1) and (2) collectively being referred
to as an “ Change in Control Termination ”),
Employee will be entitled to receive payment of severance benefits
as described below:
(i) Employee
shall be entitled to a lump sum cash payment equal to SIX
months of the employee’s regular base salary, reduced for
applicable taxes, within 10 days of termination.
(ii) Employee’s
entitlement to any benefits under this Section 2(b) is
conditioned upon Employee’s (A) execution and delivery
to the Company of a general release of
claims
in a form reasonably satisfactory to the Company, and
(B) resignation from all of Employee’s positions with
the Company and its Board of Directors and any committees thereof
on which Employee serves, in a form satisfactory to the
Company.
(c)
Termination for Cause . If Employee’s
employment is terminated for Cause, then Employee shall not be
entitled to receive payment of any severance benefits. Employee
will receive payment(s) for all salary and unpaid vacation accrued
as of the date of Employee’s termination of employment and
Employee’s benefits will be continued under the
Company’s then existing benefit plans and policies in
accordance with such plans and policies in effect on the date of
termination and in accordance with applicable law.
3. Definitions
.
(a)
Cause . For purposes of this Agreement,
“ Cause ” for Employee’s termination will
exist at any time after the happening of one or more of the
following events:
(i) Employee’s
willful misconduct or gross negligence in performance of his/her
duties to the Company, including Employee’s refusal to comply
in any material respect with the reasonable legal directives of the
Company’s Chief Exe
