EXHIBIT 10.08
Xxxxx 0, 0000
Xxxxxxxxx X. Xxxxxx
000 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Dear Xxxxx:
On behalf of Affiliation Networks, Inc., I am pleased to offer you the position
of Vice President of Sales on the terms and conditions set forth below (the
"Agreement"), beginning on 17 March 1999 (the "Effective Date").
1. DUTIES. You will report to the President and CEO. As Vice President of
Sales, you will be responsible for all duties and responsibilities associated
with that position. In addition, you will be responsible for all services
requested of you by the Company, including its Board of Directors.
2. COMPENSATION AND BENEFITS.
(a) Compensation. As compensation for your services and for your
covenants and promises in this Agreement, the Company agrees to provide you with
the following:
(i) Base Compensation. A base salary of two hundred thousand
($200,000) annually, less payroll deductions and withholdings, payable biweekly.
(ii) Incentive Compensation. You will be eligible to earn an
additional quarterly bonus of $18,750 at plan ($75,000 annually), based upon
achievement of mutually agreed upon sales performance goals, which will be
provided to you during the first ninety (90) days of your employment. Your bonus
will be 100% guaranteed for the first two (2) quarters of full-time employment.
(iii) Equity Compensation. Subject to your acceptance of employment
with the Company and the approval of the Board of Directors of the Company, the
Company will sell to you two hundred thousand (200,000) shares (each a "Share"
and collectively "Shares") of the Company's Common Stock at a price of seven
cents ($.07) per Share. All of the Shares shall be subject to a right of
repurchase in favor of the Company (the "Repurchase Right") that shall be
exercisable for seven cents ($0.07) per Share within the ninety-day period
following termination of your employment with the Company. Shares shall be
released from the Repurchase Right in the following installments: fifty thousand
(50,000) of the Shares will be released from the Repurchase Right on the first
anniversary of the date you commence employment with the Company, and thereafter
monthly installments equal to the lesser of either (a) four thousand one hundred
sixty-seven (4,167) of the Shares, or (b) the remaining number of Shares subject
to the Repurchase Right, shall be released until the earlier of: (1) all of the
Shares are released from the Repurchase Right, or (2) the date your employment
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with the Company terminates. This offer to purchase the Company's Common Stock
is an integral component of the offer to you of employment by the Company, and
expires or is revoked when such offer of employment expires or is revoked.
Notwithstanding the foregoing, this offer to purchase Shares expires at midnight
on Friday, March 19, 1999.
(b) Benefits. You will also be eligible for standard Company
benefits. The Company offers a comprehensive benefit package including medical,
dental and vision coverage for you and your eligible dependents. In addition,
we will provide $50,000 in life insurance coverage, short and long term
disability plans, vacation and sick pay and paid holidays. The Company may
modify compensation and benefits from time to time as it deems necessary.
3. COMPANY POLICIES. As an Affiliation, Inc. employee, you will be
expected to abide by the Company's policies and procedures. As a condition of
your employment, you also agree to sign and comply with the Proprietary
Information Agreement attached hereto as Exhibit A which prohibits unauthorized
use or disclosure of Affiliation, Inc. proprietary information.
4. OTHER AGREEMENTS. By accepting this offer, you represent and warrant
that your performance of your duties for the Company will not violate any
agreements, obligations or understandings that you may have with any third party
or prior employer.
5. AT-WILL EMPLOYMENT. Your relationship with the Company is one of "at-
will employment," meaning either you or the Company can terminate the
relationship at any time, with or without notice or with or without cause. This
at-will employment relationship cannot be altered except in writing signed by a
Company officer.
6. SEVERANCE BENEFITS.
(a) Termination By The Company Without Cause or Termination By You For
Good Reason. In the event that your employment is terminated by the Company
without Cause or terminated by you with Good Reason, and if you provide the
Company with a signed general release of all claims in a form approved by the
Company, the Company shall provide you with continuation of your base salary for
a period of six (6) months after your termination date. Additionally, the
Company shall release from the Repurchase Right fifty thousand (50,000) of the
Shares beyond what you already have vested as of the date of termination. You
understand and agree that in the event of a termination of employment by the
Company without Cause or by you with Good Reason, you shall not be entitled to
any other severance pay, severance benefits, or any other compensation or
benefits other than as set forth in this paragraph.
(b) Termination By The Company With Cause Or Termination By You
Without Good Reason. If your employment is terminated by the Company at any
time with Cause, or by you without Good Reason, you shall not be entitled to any
severance pay, severance benefits, or any compensation or benefits from the
Company whatsoever.
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(c) Cause. For the purpose of this Agreement, "Cause" shall mean: (i)
conviction of any felony or of any crime involving moral turpitude, including
fraud and dishonesty; (ii) participation in any fraud or act of dishonesty
against the Company; (iii) material breach of your duties to the Company,
including but not limited to unsatisfactory performance of job duties or
violation of Company policy (as determined in good faith by the Company's Board
of Directors), which remains uncured for a period of ninety (90) days following
written notice by the Company; (iv) intentional damage to any material property
of the Company; (v) conduct by you which in the good faith and reasonable
determination of the Board of Directors of the Company, demonstrates gross
unfitness to serve; or (vi) material breach of your responsibilities to the
Company regarding Proprietary Information.
(d) Good Reason. For the purpose of this Agreement, "Good Reason"
shall mean: (i) substantial reduction of your rate of compensation in effect as
of the Effective Date of this Agreement; (ii) material reduction in your duties;
(iii) failure or refusal of a successor to the Company to assume the Company's
obligations under this Agreement in the event of a Change of Control as defined
herein; or (iv) material breach by the Company or any successor the Company of
any of the material provisions of this Agreement, which remains uncured for a
period of thirty (30) days following written notice by you.
(e) Change of Control. For the purpose of this Agreement, a "Change or
Control" shall mean: (a) a sale of substantially all of the assets of the
Company; (b) a merger or consolidation in which the Company is not the surviving
corporation (other than a merger or consolidation in which shareholders
immediately before the merger or consolidation have, immediately after the
merger or consolidation, equal or greater stock voting power); (c) a reverse
merger in which the company is the surviving corporation but the shares of the
Company's common stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether in the form of
securities, cash or otherwise (other than a reverse merger in which stockholders
immediately before the merger have, immediately after the merger, equal or
greater stock voting power); or (d) any transaction or series of related
transactions in which in excess of 50% of the Company's voting power is
transferred.
7. RETURN OF MATERIALS. At the termination of your employment with the
Company, you will promptly return to the Company, and will not take with you or
use, all items of any nature that belong to the Company, and all materials, in
any form, format, or medium (containing or relating to the Company's business).
8. RIGHT TO WORK. As required by law this offer of employment is subject
to satisfactory proof of your right to work in the United States.
9. ENTIRE AGREEMENT. This Agreement, including the attached Proprietary
Information Agreement, constitutes the complete, final and exclusive embodiment
of the entire Agreement between you and the Company with respect to the terms
and conditions of your employment. If you enter into this Agreement you are
doing so voluntarily, and without reliance on any promise, warranty or
representation, written or oral, other than those expressly contained herein.
This Agreement supersedes any other such promises, warranties, representations
or
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agreements. This Agreement may not be amended or modified except by a written
instrument signed by you and a duly authorized officer of the Company.
10. ENFORCEABILITY. If any provision of this Agreement is determined to
be invalid or unenforceable, in whole or in part, this determination will not
affect any other provision of this Agreement, and the Agreement, including the
invalid or unenforceable provisions, should be enforced insofar as possible to
achieve the intent of the parties.
11. CHOICE OF LAW. This Agreement will be deemed to have been entered
into and will be construed and enforced in accordance with the laws of the State
of California as applied to contracts made and to be performed entirely within
California.
This offer expires at the end of the day on March 7, 1999. If you choose
to accept our offer under the terms described above, please sign this Agreement
and the attachment and return both to me. If you accept our offer, would like
you to begin employment no later than Wednesday, March 17, 1999.
Xxxxx, I look forward to your favorable reply and to a productive and
enjoyable work relationship going forward.
Sincerely,
AFFILIATION NETWORKS, INC.
/s/ Xxxx Xxxx
-------------------------------
Xxxx Xxxx
CEO & President
Accepted and Agreed to as of
the Effective Date setforth above, by:
/s/ Xxxxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxxxx X. Xxxxxx
Start Date: 17 March 1999
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