EXHIBIT 10.1
November 9, 2005
VIA PDF
Xxxxxxx Xxx
00000 XX 000xx Xxxxxx
Xxxxxxx, XX 00000
Re: Mutual Termination of Employment Agreement
Dear Xxxxxxx:
On behalf of the board of directors of Loudeye Corp., let me first express our
continued appreciation for all your efforts on behalf of Loudeye. As discussed
between you and Xxxx Xxxxxx over the past several days, you and Loudeye have
reached a mutual agreement to terminate your Employment Agreement dated December
5, 2003. You will remain as Chairman of the Board, now a non-employee position
on Loudeye's board of directors. The terms of the mutual agreement are as
follows:
1. SEVERANCE. You will be paid six months severance totaling $75,000
(subject to standard withholding deductions) as follows:
- On the November 15, November 30, December 15 and December 30,
2005 pay dates you will receive you regular semi-monthly
salary payment amounts as severance.
- On January 15, 2006, you will receive a one-time lump sum
payment equal to $53,333.33 ($75,000 less your severance from
November 9-November 30 ($9,166.67) and less your severance
from December 1-December 31 ($12,500)).
2. VACATION. You will not be paid any accrued vacation.
3. BENEFITS. Loudeye will continue to pay your benefits through
December 31, 2005.
4. VESTING. You will continue to vest in all outstanding stock options
in your capacity as a Loudeye director.
5. POINTS ON SALE. You will be entitled to the benefits of Section 3(f)
of the Employment Agreement regarding a Sale Bonus on the terms
stated in the Employment Agreement. For this purpose, you and
Loudeye agree that the mutual termination of your Employment
Agreement will be deemed a termination without Cause of the
Employment Agreement on November 8, 2005.
6. NON-EMPLOYEE DIRECTOR COMPENSATION. You will be entitled to receive
Loudeye's standard non-employee director compensation starting April
8, 2006.
7. DISCLOSURE. Loudeye will include disclosure of the foregoing in its
quarterly report on Form 10-Q for the quarter ended September 30,
2005, substantially as follows:
On November 9, 2005, Loudeye and Xxxxxxx Xxx mutually agreed to
terminate Mr. Bay's employment agreement dated December 5, 2003. Mr.
Bay will remain Chairman of the Board, now a non-employee position
on Loudeye's board of directors. Loudeye and Mr. Bay have agreed
that he will receive severance equal to six months of his prior
annual salary. Also, in the event that a Change of Control (as
defined in Mr. Bay's employment agreement) is consummated within six
months of November 8, 2005, Mr. Bay will be entitled to a bonus
provided for in the terminated employment agreement which is equal
to 1.5% of the difference in value between the consideration in the
Change of Control and Loudeye's market value as of April 1, 2003.
Mr. Bay will be entitled to receive Loudeye's standard non-employee
director compensation starting April 8, 2006.
If you are in agreement with the above, please sign below and fax a copy of the
countersigned letter to Xxxx Xxxxxxx at (000) 000-0000. You are welcome to seek
independent advice of counsel to assist you in review of this letter agreement.
Best regards,
Loudeye Corp.
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
President and CEO
Acknowledged and Agreed:
/s/ Xxxxxxx Xxx
-------------------
Xxxxxxx Xxx
cc: Xxxx Xxxxxx
Johan Liedgren
Xxxxx Xxxxxxxx
Xxx Xxxxxxx
Xxxx Xxxxxxx
