Compensation; Reimbursement. (a) During the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000, payable semi-monthly. Such Base Salary will be reviewed at least annually and may be increased by the Board or the Board's designee (excluding the Employee if he should be a member of the Board at the time of such determination) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced. (b) The Employee shall be eligible to receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year of the Employment Period based upon his achievement of performance criteria mutually agreed upon by the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar year. (c) During the Employment Period and to the extent available to senior executive officers of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of the Company. Notwithstanding anything to the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start Date. (d) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers. (e) Subject to approval by the Compensation Committee of the Board of Directors of the Company, the Company shall grant the Employee, on or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee, which ISO Agreement shall contain all of the terms and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider the Employee for future annual or other grants of stock options and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officers. (f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur: (i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction; (ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date. (g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company. (h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Samples: Employment Agreement (Opus360 Corp)
Compensation; Reimbursement. (a) During the Employment PeriodTerm of Employment, the Company Corporation (or at the CompanyCorporation's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual base salary (the "Base Salary") of not less than Three Hundred Fifty Thousand Dollars ($175,000350,000), payable semi-monthly. Such Base Salary will be reviewed at least annually and may be increased by in installments as is the Board or the Board's designee (excluding the Employee if he should be a member policy of the Board Corporation with respect to employees of the Corporation at substantially the time of such determination) same employment level as the Employee, but in its sole discretionno event less frequently than once per month. Effective as of any such increaseThereafter, the Base Salary as so increased shall be considered subject to increase at the new Base Salary for all purposes option and in the sole discretion of this Agreement and may not thereafter be reducedthe Board of Directors of the Corporation based on the performance of Employee.
(b) The As of December of each calendar year during the Term of Employment, Employee shall be eligible entitled to receive an annual bonus as determined by the Board of no less than one hundred fifty thousand dollars ($150,000) during each calendar year Directors of the Employment Period based upon his achievement of performance criteria mutually agreed upon by the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be Corporation based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar yearEmployee's performance.
(ci) During the Employment Period and to the extent available to senior executive officers Term of the CompanyEmployment, the Employee shall be entitled to participate in all medical insurance coverage (the cost of which shall be paid by the Company's benefit plans, pension Corporation) and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and to such other fringe benefits enjoyed by other senior executive officers as are made available from time to time to the employees of the CompanyCorporation at substantially the same employment level as the Employee, including, without limitation, four weeks paid vacation. Notwithstanding anything In lieu of participation in any corporate sponsored medical insurance plan of the Corporation, and whether or not the Corporation provides such a plan, Employee shall have the right to convert his current medical insurance coverage to an individual policy and to maintain such policy or one essentially equivalent thereto and to have the contrary contained Corporation pay the premium therefor (up to a maximum annual premium of $7,500) during the Term of Employment it being agreed and understood that Employee may elect to terminate any such individual policy and participate in this Section 5(c), a corporate sponsored medical insurance plan at no any time during the Term of Employment Period shall at the long-term disability coverage Corporation's expense and life insurance benefits that the Company provides without regard to the Employee be reduced premium therefor.
(ii) Upon the termination of the Employee's employment hereunder pursuant to a level below that being provided Constructive Termination or a Termination Without Cause, Employee shall have the right to continue his current individual medical insurance policy, or convert his current corporate sponsored medical insurance coverage to an individual policy, and to maintain such policy or one essentially equivalent thereto and to have the Employee as Corporation pay the premium therefor (up to a maximum annual premium of $7,500) for a period of twenty-four months after the Start Date.termination of
(d) The Company Corporation shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers of the CompanyCorporation, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company Corporation in the performance of his duties hereunder upon presentation by the Employee to the Company Corporation of appropriate vouchers.
(e) Subject to approval During the Term of Employment, the Corporation shall provide Employee with a monthly automobile allowance (or an automobile leased in the Corporation's name with the rental payment paid by the Compensation Committee Corporation) not to exceed Eight Hundred and Fifty Dollars ($850.00) per month, to cover the cost of the Board of Directors of the Company, the Company shall grant the Employee, on 's purchase or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value lease of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee, which ISO Agreement shall contain all of the terms and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereaftercar. The Company Corporation shall at least once each year commencing in 2001 consider the reimburse Employee for future annual or other grants of stock options and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officers.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred taxes (but not penalties or interest) due and payable to Employee as a result of an exercise receipt of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge said automobile allowance or use of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the CompanyCorporation's leased automobile hereunder.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Compensation; Reimbursement. (a) During the Employment PeriodTerm, the Company (or or, at the Company's option, any subsidiary or affiliate thereofof the Company) shall pay to the Employee Executive an annual salary (the "Base Salary") of not less than $175,000180,000, payable semi-monthlyin accordance with the Company' normal payroll practices. Such Base Salary will shall be reviewed at least annually and may be increased periodically by the Board or the Board's designee (excluding the Employee if he should be a member of Directors at their convenience, but no less frequently than annually, for increase by the Board at of Directors in their sole discretion and in accordance with the time of such determination) in its sole discretionCompany's established policies. Effective as of any such increaseAt a minimum, the Base Salary shall be adjusted by the annual change in the United States Consumer Price Index. Such Base as so increased adjusted shall be considered the new Base Salary than constitute Executive's "Base" for all purposes of this Agreement and may not thereafter be reducedAgreement.
(b) The Employee shall be eligible to receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year of the Employment Period based upon his achievement of performance criteria mutually agreed upon by the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar year.
(c) During the Employment Period Term and to the extent available to senior executive officers employees of the Company, the Employee Company (including any of its subsidiaries) shall be entitled to participate in all of the Company's benefit plans, pension pension, welfare and retirement plans, directors' and officers liability insurance, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other standard fringe benefits enjoyed maintained or sponsored by other senior executive officers of the Company. Notwithstanding anything to the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start Dateor its subsidiaries.
(dc) The Company shall promptly reimburse the EmployeeExecutive, in accordance with the practice from time to time for other senior executive officers published guidelines of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee Executive to the Company of appropriate vouchersreceipts and documentation. Additionally, during the Initial Term the Company shall reimburse the Executive for automobile expenses at the rate of $1,000 per month.
(d) Following the expiration or termination of the Term for any reason, the Executive shall have the right to maintain any (i) health and life insurance benefits provided by the Company to the extent provided under applicable law an (ii) any life insurance benefits provided byte Company so long as the Executive makes the premium payments relating to such life insurance and is allowed to do so per the respective life insurance company.
(e) Subject The Executive shall be entitled to approval participate in an equitable manner with other executive officers of the Company and its subsidiaries in such discretionary bonus payments or awards as may be authorized, declared, and paid by the Compensation Committee of the Board of Directors of to the Company's executives. More specifically, the Company shall grant will make the Employee, on or as soon as practicable after the Start Date, options Executive a participant in its Annual Incentive Plan (the "OptionsAIP") for senior management at a target incentive rate subject to purchasespecific parameters of performance as established by the Board of Directors for the AIP. Until such time as an AIP is approved by the Board of Directors, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO Executive shall be the maximum number permitted under the terms entitled to earn as an annual incentive up to 50% of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee, which ISO Agreement shall contain all of the terms and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider the Employee for future his annual or other grants of stock options and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officerssalary.
(f) Upon the first occurrence of Until and unless a Transaction Closing Date (as defined below) stock option plan specifically for the Company shall grant to Employee an option (is instituted, the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant Executive will participate, according to the terms and conditions thereof, in the company's stock option plan to the same degree as other executive employees of like grade and status. Upon establishment of a written Company stock option agreement between plan, the Company and Employee substantially in the form attached Executive will participate, according to the Original Agreement for the ISO or NSO, as applicable. Such option shallterms and conditions thereof, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) same degree as other Company employees of the Shares represented by the Transaction Option shall be immediately vested upon grant like grade and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Datestatus.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Compensation; Reimbursement. (a) During the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000190,000, payable semi-monthlyin such installments as is the policy of the Company with respect to its senior executive officers. Such Base Salary will be reviewed at least annually and may be increased by the Board or the Board's designee (excluding the Employee or, if he should such authority shall be a member of delegated by the Board at to the time of Compensation Committee thereof, then by such determinationCommittee) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced.
(b) The From time to time the Employee shall be eligible to may also receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year cash bonuses at the discretion of the Employment Period based upon his achievement of performance criteria mutually agreed upon by Board or the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar yearCompensation Committee.
(c) During the Employment Period and to the extent available to senior executive officers employees of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of employees at substantially the Company. Notwithstanding anything to same employment level as the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start DateEmployee.
(d) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers employees of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers.
(e) Subject to approval by The Employee shall maintain a suitable automobile for business use. During the Compensation Committee of the Board of Directors of the CompanyEmployment Period, the Company shall grant the Employee, on or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and pay the Employee a $400 per month car allowance towards the costs of leasing, using, insuring, repairing and maintaining such automobile.
(f) Following the "ISO Agreement"expiration or termination of this Agreement for any reason, the Employee shall have the right to maintain any (i) shall be prepared health and delivered life insurance benefits provided by the Company to the Employee, which ISO Agreement shall contain all of the terms extent provided under applicable law and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements"ii) shall be prepared and delivered any life insurance benefits provided by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider so long as the Employee for future annual or other grants of stock options and other equity awards on at least makes the same basis as premium payments relating to such options and equity awards are granted to other senior executive officerslife insurance.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Compensation; Reimbursement. (a) During the Employment PeriodTerm, the Company (or or, at the Company's option, any subsidiary or affiliate thereofof the Company) shall pay to the Employee Executive an annual salary (the "Base Salary") of not less than $175,000160,000, payable semi-monthlyin accordance with the Company' normal payroll practices. Such Base Salary will shall be reviewed at least annually and may be increased periodically by the Board or the Board's designee (excluding the Employee if he should be a member of Directors at their convenience, but no less frequently than annually, for increase by the Board at of Directors in their sole discretion and in accordance with the time of such determination) in its sole discretionCompany's established policies. Effective as of any such increaseAt a minimum, the Base Salary shall be adjusted by the annual change in the United States Consumer Price Index. Such Base as so increased adjusted shall be considered the new Base Salary than constitute Executive's "Base" for all purposes of this Agreement and may not thereafter be reducedAgreement.
(b) The Employee shall be eligible to receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year of the Employment Period based upon his achievement of performance criteria mutually agreed upon by the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar year.
(c) During the Employment Period Term and to the extent available to senior executive officers employees of the Company, the Employee Company (including any of its subsidiaries) shall be entitled to participate in all of the Company's benefit plans, pension pension, welfare and retirement plans, directors' and officers liability insurance, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other standard fringe benefits enjoyed maintained or sponsored by other senior executive officers of the Company. Notwithstanding anything to the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start Dateor its subsidiaries.
(dc) The Company shall promptly reimburse the EmployeeExecutive, in accordance with the practice from time to time for other senior executive officers published guidelines of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee Executive to the Company of appropriate vouchersreceipts and documentation. Additionally, during the Initial Term the Company shall reimburse the Executive for office expenses at the rate of $500 per month.
(d) Following the expiration or termination of the Term for any reason, the Executive shall have the right to maintain any (i) health and life insurance benefits provided by the Company to the extent provided under applicable law an (ii) any life insurance benefits provided byte Company so long as the Executive makes the premium payments relating to such life insurance and is allowed to do so per the respective life insurance company.
(e) Subject The Executive shall be entitled to approval participate in an equitable manner with other executive officers of the Company and its subsidiaries in such discretionary bonus payments or awards as may be authorized, declared, and paid by the Compensation Committee of the Board of Directors of to the Company's executives. More specifically, the Company shall grant will make the Employee, on or as soon as practicable after the Start Date, options Executive a participant in its Annual Incentive Plan (the "OptionsAIP") for senior management at a target incentive rate subject to purchasespecific parameters of performance as established by the Board of Directors for the AIP. Until such time as an AIP is approved by the Board of Directors, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO Executive shall be the maximum number permitted under the terms entitled to earn as an annual incentive up to 50% of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee, which ISO Agreement shall contain all of the terms and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider the Employee for future his annual or other grants of stock options and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officerssalary.
(f) Upon the first occurrence of Until and unless a Transaction Closing Date (as defined below) stock option plan specifically for the Company shall grant to Employee an option (is instituted, the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant Executive will participate, according to the terms and conditions thereof, in the company's stock option plan to the same degree as other executive employees of like grade and status. Upon establishment of a written Company stock option agreement between plan, the Company and Employee substantially in the form attached Executive will participate, according to the Original Agreement for the ISO or NSO, as applicable. Such option shallterms and conditions thereof, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) same degree as other Company employees of the Shares represented by the Transaction Option shall be immediately vested upon grant like grade and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Datestatus.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Compensation; Reimbursement. (a) During the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000190,000, payable semi-monthlyin such installments as is the policy of the Company with respect to its senior executive officers. Such Base Salary will be reviewed at least annually and may be increased by the Board or the Board's designee (excluding the Employee or, if he should such authority shall be a member of delegated by the Board at to the time of Compensation Committee thereof, then by such determinationCommittee) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced.
2 (b) The From time to time the Employee shall be eligible to may also receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year cash bonuses at the discretion of the Employment Period based upon his achievement of performance criteria mutually agreed upon by Board or the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar yearCompensation Committee.
(c) During the Employment Period and to the extent available to senior executive officers employees of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of employees at substantially the Company. Notwithstanding anything to same employment level as the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start DateEmployee.
(d) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers employees of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers.
(e) Subject to approval by The Employee shall maintain a suitable automobile for business use. During the Compensation Committee of the Board of Directors of the CompanyEmployment Period, the Company shall grant the Employee, on or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and pay the Employee a $550 per month car allowance towards the costs of leasing, using, insuring, repairing and maintaining such automobile.
(f) Following the "ISO Agreement"expiration or termination of this Agreement for any reason, the Employee shall have the right to maintain any (i) shall be prepared health and delivered life insurance benefits provided by the Company to the Employee, which ISO Agreement shall contain all of the terms extent provided under applicable law and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements"ii) shall be prepared and delivered any life insurance benefits provided by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider so long as the Employee for future annual or other grants of stock options and other equity awards on at least makes the same basis as premium payments relating to such options and equity awards are granted to other senior executive officerslife insurance.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Samples: Employment Agreement (Aht Corp)
Compensation; Reimbursement. (a) During the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000250,000, payable semi-monthly. Such Base Salary will be reviewed at least annually and may be increased by the Board or the Board's designee (excluding the Employee if he should be a member of the Board at the time of such determination) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced.
(b) The Employee shall be eligible to receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000100,000) during each calendar year of the Employment Period (pro-rated for partial calendar years of employment by the Company for calendar years after 2000) based upon his achievement of performance criteria mutually agreed upon by the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President Chief Executive Officer of the Company for such calendar year.
(c) During the Employment Period and to the extent available to senior executive officers of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of the Company. Notwithstanding anything to the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start Date.
(d) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers.
(e) Subject to approval by the Compensation Committee of the Board of Directors of the Company, the The Company shall grant the Employee, on or as soon as practicable after the Start Datedate of grant, options (i) an option (the "OptionsISO") to purchase, in purchase up to 21,945 shares (as adjusted pursuant to the aggregate, 700,000 shares Stock Option Agreements (as defined below)) of common stock of the Company (the "Common Stock") which is based on pursuant to the fair market value terms and conditions of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee Employee, the form of which is attached hereto as Exhibit A (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee), which ISO Agreement shall contain all of the terms and conditions of the ISO, and (ii) an option (the "NSO" and together with the ISO, "Options") to purchase up to 983,055 shares (as adjusted pursuant to the Stock Option Agreements) of Common Stock pursuant to the terms and conditions of a written option agreement between the Company and the Employee Employee, the form of which is attached hereto as Exhibit B (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee), which NSO Agreement shall contain all of the terms and conditions of the NSO. 200,000 of Options to purchase 140,000 shares shall vest on the date of Common Stock shall be vested immediately upon grant and the balance remaining 805,000 of the Options shall vest over three years, 6/36 of such balance amount shall vest on the six month anniversary of the date of grant and 1/36 of such balance amount shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider the Employee for future annual or other grants of stock options and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officers.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Samples: Employment Agreement (Opus360 Corp)
Compensation; Reimbursement. (a) During the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000, payable semi-monthlyin such installments as is the policy of the Company with respect to its senior executive officers. Such Base Salary will be reviewed at least annually and may be increased 2 by the Board or the Board's designee (excluding the Employee or, if he should such authority shall be a member of delegated by the Board at to the time of Compensation Committee thereof, then by such determinationCommittee) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall be considered the new Base Salary for all purposes of this Agreement and may not thereafter be reduced.
(b) The From time to time the Employee shall be eligible to may also receive an annual bonus of no less than one hundred fifty thousand dollars ($150,000) during each calendar year cash bonuses at the discretion of the Employment Period based upon his achievement of performance criteria mutually agreed upon by Board or the Employee and the Company. The performance criteria for the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established for the President of the Company for such calendar yearCompensation Committee.
(c) During the Employment Period and to the extent available to senior executive officers employees of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of employees at substantially the Company. Notwithstanding anything to same employment level as the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start DateEmployee.
(d) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers employees of the Company, for all reasonable and necessary traveling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers.
(e) Subject to approval by The Employee shall maintain a suitable automobile for business use. During the Compensation Committee of the Board of Directors of the CompanyEmployment Period, the Company shall grant the Employee, on or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and pay the Employee a $600 per month car allowance towards the costs of leasing, using, insuring, repairing and maintaining such automobile.
(f) Following the "ISO Agreement"expiration or termination of this Agreement for any reason, the Employee shall have the right to maintain any (i) shall be prepared health and delivered life insurance benefits provided by the Company to the Employee, which ISO Agreement shall contain all of the terms extent provided under applicable law and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements"ii) shall be prepared and delivered any life insurance benefits provided by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider so long as the Employee for future annual or other grants of stock options and other equity awards on at least makes the same basis as premium payments relating to such options and equity awards are granted to other senior executive officerslife insurance.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSO, as applicable. Such option shall, to the extent permitted under applicable law, be an ISO. The right to purchase twenty percent (20%) of the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafter. The "Transaction Closing Date" shall be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the Company.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
Appears in 1 contract
Samples: Employment Agreement (Aht Corp)
Compensation; Reimbursement. (a) During Commencing on February 16, 1998, and continuing during the Employment Period, the Company (or at the Company's option, any subsidiary or affiliate thereof) shall pay to the Employee an annual salary (the "Base Salary") of not less than $175,000190,000, payable semi-monthlyin such installments as is the policy of the Company with respect to its senior executive officers. Such Base Salary will be reviewed at least annually and may be increased by the Board or the Board's designee (excluding the Employee or, if he should such authority shall be a member of delegated by the Board at to the time of Compensation Committee thereof, then by such determinationCommittee) in its sole discretion. Effective as of any such increase, the Base Salary as so increased shall The Employee will be considered the new Base Salary reimbursed $600 per month for all purposes of this Agreement and may not thereafter be reducedcar allowance.
(b) The Employee shall will be eligible to receive an participate in the Employer's annual bonus program in accordance with the provisions of no less than one hundred fifty thousand dollars ($150,000) during each calendar year of the Employment Period based upon his achievement of performance criteria mutually agreed upon by that plan. The bonus opportunity for the Employee and the Company. The performance criteria for is up to 30% of base salary, prorated in the first year of the Employment Period shall be satisfied in the event that the Company achieves gross revenue of $15 million for calendar year 2000. With respect to subsequent calendar years, it is expected that the performance criteria will be based on increasing gross revenue targets to be agreed upon within thirty (30) days after each anniversary of this Employment Agreement and that such targets shall be consistent with and no higher than the performance targets established employment for the President Employee's date of hire. Payment of bonus is dependent upon company performance and the Company for such calendar yearEmployee's individual performance of pre-established goals, and is payable in cash.
(c) Following the expiration or termination of this Agreement for any reason, the Employee shall have the right to maintain any (i) health and life insurance benefits provided by the Company to the extent provided under applicable law and (ii) any life insurance benefits provided by the Company so long as the Employee makes the premium payments relating to such life insurance.
(d) During the Employment Period and to the extent available to senior executive officers employees of the Company, the Employee shall be entitled to participate in all of the Company's benefit plans, pension and retirement plans, life insurance, hospitalization and surgical and major medical coverages, sick leave, vacation and holiday policies, long-term disability coverage and such other fringe benefits enjoyed by other senior executive officers of employees at substantially the Company. Notwithstanding anything to same employment level as the contrary contained in this Section 5(c), at no time during the Employment Period shall the long-term disability coverage and life insurance benefits that the Company provides to the Employee be reduced to a level below that being provided to the Employee as of the Start DateEmployee.
(de) The Company shall reimburse the Employee, in accordance with the practice from time to time for other senior executive officers employees of the Company, for all reasonable and necessary traveling travelling expenses, disbursements and other reasonable and necessary incidental expenses incurred by him for or on behalf of the Company in the performance of his duties hereunder upon presentation by the Employee to the Company of appropriate vouchers.
(ef) Subject to approval The Company shall reimburse the Employee for reasonable relocation expenses incurred by the Compensation Committee Employee in order to relocate to the greater New York City metropolitan area (the "Relocation Expenses"), including expenses relating to housing search visits to the greater New York City metropolitan area for the Employee and the Employee's spouse, temporary living expenses in the greater New York metropolitan area through May 16, 1998, packing and moving of the Board Employee's and the Employee's family's goods, closing costs in connection with the purchase of Directors a house upon relocation to the greater New York City metropolitan area and real estate commissions incurred in connection with the sale of the Employee's house in Winchester, Massachusetts; provided that the Company shall not be obligated to reimburse the Employee more than $55,000 in the aggregate for all Relocation Expenses, excluding housing search visits to the greater New York City metropolitan area. All Relocation Expenses shall be approved in advance by another officer of the Company. The Employee shall be fully relocated to the greater New York City metropolitan area as of May 16, 1998. Prior to May 16, 1998, the Company shall grant the Employee, on or as soon as practicable after the Start Date, options (the "Options") to purchase, in the aggregate, 700,000 shares of common stock of the Company (the "Common Stock") which is based on the fair market value of a share of Common Stock on the date of grant. A portion of the Options shall qualify for federal income tax purposes as "incentive stock options" (the "ISO") (the number of options that will qualify as the ISO shall be the maximum number permitted under the terms of the Company's 2000 Stock Option Plan), and the remainder shall not qualify for federal tax purposes as "incentive stock options" (the "NSO"). A written option agreement between the Company and the Employee (the "ISO Agreement") shall be prepared and delivered by the Company to the Employee, which ISO Agreement shall contain all of the terms and conditions of the ISO, and a written option agreement between the Company and the Employee (the "NSO Agreement" and together with the ISO Agreement, the "Stock Option Agreements") shall be prepared and delivered by the Company to the Employee, which NSO Agreement shall contain all of the terms and conditions of the NSO. Options to purchase 140,000 shares of Common Stock shall be vested immediately upon grant and the balance of the Options shall vest over three years, 6/36 of such balance shall vest on the six month anniversary of the date of grant and 1/36 of such balance shall vest each month thereafter. The Company shall at least once each year commencing in 2001 consider reimburse the Employee for future annual or other grants of stock options the expenses incurred by the Employee in connection with the Employee's trips to and other equity awards on at least the same basis as such options and equity awards are granted to other senior executive officers.
(f) Upon the first occurrence of a Transaction Closing Date (as defined below) the Company shall grant to Employee an option (the "Transaction Option") to purchase up to 300,000 shares of the Company's common stock ("Shares") pursuant to the terms of a written option agreement between the Company and Employee substantially in the form attached to the Original Agreement for the ISO or NSOfrom Winchester, as applicable. Such option shall, to the extent permitted under applicable law, be an ISOMassachusetts. The right to purchase twenty percent (20%) Employer will grant an additional "gross-up-payment" of all expenses paid which are not tax deductible under the Shares represented by the Transaction Option shall be immediately vested upon grant and the right to purchase the remaining eighty percent (80%) of such Shares shall vest with respect to 1/6 of such Shares on the date which is six months after the date of grant and with respect to 1/36 of such Shares each month thereafterInternal Revenue Code. The "Transaction Closing Dategross-up-payment" shall will be the date of consummation of the first of any of the following (each, a "Transaction") to occur:
(i) an acquisition by the Company of equity or assets of another company in a single transaction, the aggregate purchase price of which is not less than the greater of fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction;
(ii) an investor makes an equity investment in the Company where the aggregate purchase price of which is not less than fifteen percent (15%) of the value of the Company's common stock outstanding as of the Transaction Closing Date without giving effect to the Transaction. In the event that the grant of the Transaction Option would result in the total number of employee stock options issued by the Company and outstanding as of the Transaction Closing Date, stated calculated as a percentage of the outstanding common or common equivalent shares of stock as of the Transaction Closing Date after giving effect to the Transaction and any other grants of options to be issued applicable expenses based on the Transaction Closing Date (the "Option Percentage") exceeding 23%, Employee shall be granted as of the Transaction Closing Date an option to purchase that number of shares that results in the Option Percentage equaling 22.5% as of the Transaction Closing Date after giving effect to the Transaction and the Transaction Option Grant, and the remainder of the Transaction Option shall be granted with the same terms as are set forth above in this paragraph (g), on the date which is ninety (90) days after the Transaction Closing Date.
(g) Within 30 days after a Transaction Closing Date has occurred, which if the Transaction is of the type defined in subparagraph (f)(i) above has resulted in the Company having no less than $70 million in cash on its balance sheet immediately after the Transaction Closing Date, at Employee's option, annualized base salary at the Company will make a loan to Employee of not in excess of $1,000,000 for purposes of funding time the payment by Employee of federal, state and local income tax liabilities incurred as a result of an exercise of options then held by Employee and vested as of such date, provided that such loan shall be secured by a promissory note from Employee to the Company which shall be full recourse to Employee and shall be further secured by a pledge of the stock purchased through the exercise of such options; both the promissory note and pledge agreement shall be in form and substance satisfactory to the CompanyEmployee's move is completed.
(h) The Employee authorizes the Company to deduct from any amounts payable to him hereunder such sums as may be required to be deducted or withheld under the provisions of any federal, state or local law or regulation now in effect or hereafter put into effect during the term of this Agreement, including, without limitation, social security and income withholding taxes.
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