DemandTec Inc. 50 First Street, Suite 307; San Francisco, CA 94105 July 20, 2001
Exhibit 10.7
DemandTec Inc.
00 Xxxxx Xxxxxx, Xxxxx 000; Xxx Xxxxxxxxx, XX 00000
00 Xxxxx Xxxxxx, Xxxxx 000; Xxx Xxxxxxxxx, XX 00000
July 20, 2001
Xxxx Xxxxxxx
Dear Xxxx:
DemandTec, Inc. (the “Company”) is pleased to offer you employment on the following terms:
1. Position.
The Company will employ you in a full-time position. Your initial
title will be
Executive Vice President and Chief Financial Officer, and you will initially report to me. By
signing this letter agreement, you confirm to the Company that you have no contractual commitments
or other legal obligations that would prohibit you from performing your duties for the Company.
2. Cash
Compensation. The Company will pay you a starting salary at the rate of $200,000 per
year, payable in accordance with the Company’s standard payroll schedule. In addition, you will be
paid a signing bonus of $50,000 less applicable withholdings at the first payroll date following
your commencement of employment. For purposes of any merit increases to your base salary after your
first year of employment, we will treat you as having a base salary $250,000.
3. Employee Benefits. AS a regular employee of the Company, you will be
eligible to participate in a number of Company-sponsored benefits. In addition, you will be
entitled to paid vacation in accordance with the Company’s vacation policy, as in effect from time
to time. In addition, the Company shall reimburse you for the business related expenses of
maintaining a cell phone, home fax and home internet connection upon
presentation of appropriate supporting documentation, all in accordance with the Company’s generally applicable policies.
4. Stock Options. Subject to the approval of the Company’s Board of Directors, you will be granted
an option to purchase 385,000 shares of the Company’s Common Stock, which represents 1.73% of the
currently outstanding capital stock of the Company on a fully diluted basis. The exercise price per
share will be equal to the fair market value per share on the date the option is granted or on your
first day of employment, whichever is later. The option will be subject to the terms and conditions
applicable to options granted under the Company’s 1999 Equity Incentive Plan (the “Plan”), as
described in the Plan and the applicable Stock Option Agreement. The option will be immediately
exercisable, but the purchased shares
Xxxx Xxxxxxx
July 20, 2001
Page 2
July 20, 2001
Page 2
will be subject to repurchase by the Company at the exercise price in the event that your
service terminates for any reason before you vest in the shares. You will vest in 1/8th of the
option shares after six months of continuous service, and the balance will vest in equal monthly
installments of 1/48th over the next 42 months of continuous service, as described in
the applicable Stock Option Agreement.
If the Company is subject to a Change in Control (as defined in the Plan) and you are subject
to a Constructive Termination within 12 months after that Change
in Control, then you will
be vested in an additional number of your then unvested option shares
as of the date of your
termination of employment as set forth in the table below. The
percentage of shares accelerated shall be calculated separately for each of your options.
| Year in which Change in Control | Percentage of Unvested Shares | |||
| Occurs Following Grant Date | Accelerated | |||
Year 1 |
50% | |||
Year 2 |
66.66% | |||
Year 3 |
73% | |||
Year 4 |
100% |
“Constructive Termination” means either (a) that your service is terminated by the Company
without Cause or (b) that you resign because (i) you have been assigned to duties which reflect a
material adverse change in your authority or responsibility with the Company or any successor, (ii)
the annual rate of your base salary was reduced by the Company, or (iii) the Company has relocated
your principal place of work by a distance of 35 miles or more, “Cause” means (a) any breach of
the Proprietary Information and Inventions Agreement between you and
the Company; (b) conviction
of, or a plea of “guilty” or “no contest” to, a felony under the laws of the United States or any
State or any crime involving moral turpitude; (c) your participation in any fraud against the
Company; or (d) your intentional damage to any material property of the Company or other gross
misconduct. The foregoing, however, is not an exclusive list of all acts or omissions that the
Company may consider as grounds for discharging any person in its service.
5. Severance Pay. If the Company terminates your employment prior to your completion of 4 years of
service for any reason other than Cause or permanent disability, then the Company will continue to
pay your base salary for a period of six months following the termination of your employment and
you will be vested in an additional number of shares under all of your Company options as if you
had been employed for an additional six months. Your base salary will be paid at the rate in effect
at the time of the termination of your employment and in accordance with the Company’s standard
payroll procedures. If you elect to continue your health insurance coverage under COBRA following
the termination of your employment, then the Company will pay your monthly premium under COBRA
until the earliest of (a) the close of the six-month period following the termination of your
employment, (b) the expiration of your continuation coverage under COBRA or (c) the date when you
receive
substantially equivalent health insurance coverage in connection with new employment or
self-employment. However, this Paragraph 5 will cot apply unless you (a) have executed a general
reiease (in a form
Xxxx Xxxxxxx
July 20, 2001
Page 3
July 20, 2001
Page 3
prescribed
by the Company) of all known and unknown claims that you may then have against
the Company or persons affiliated with the Company and (b) have agreed not to prosecute any legal
action or other proceeding based on those claims.
6. Proprietary Information and Inventions Agreement. Like all Company employees, you
will be required, as a condition to your employment with the Company, to sign the Company’s
standard Employee Proprietary Information and Inventions Agreement a copy of which is attached
hereto as Exhibit. A.
7. Employment
Relationship. Employment with the Company is for no specific period of time. Your
employment with the Company will be “at will,” meaning that either you or the Company may terminate
your employment at any time and for any reason, with or without cause. Any contrary representations
that may have been made to you are superseded by this offer. This is the full and complete
agreement between you and the Company on this term. Although your job duties, title, compensation
and benefits, as well as the Company’s personnel policies and procedures; may change from time to
time, the “at will” nature of your employment may only be changed in an express written agreement
signed by you and the Chief Executive Officer of the Company.
8. Outside Activities. While you render services to the Company, you agree that you will not engage
in any other employment, consulting or other business activity without the written consent of the
Company. While you render services to the Company, you also will not
assist any person or entity in
competing with the Company, in preparing to compete with the Company
or in hiring any employees or
consultants of the Company.
9. Withholding
Taxes. All forms of compensation referred to in this letter agreement are subject to
reduction to reflect applicable withholding and payroll taxes and other deductions required by law.
10. Entire
Agreement. This letter agreement supersedes and replaces any prior understandings or
agreements, whether oral or written, between you and the Company regarding the subject matter
described in this letter agreement.
* * * * *
We hope that you find the foregoing terms acceptable. You may indicate your agreement with
these terms and accept this offer by signing and dating both the enclosed duplicate original of
this letter agreement and the enclosed Employee Proprietary Information and Inventions Agreement
and returning them to me. This offer, if not accepted, will expire at the close of business on July
___, 2001. As required by law, your employment with the Company is contingent upon your providing
legal proof of your identify and authorization to work in the United
States. Your employment is
also contingent upon your starting work with the Company on or before
August 1, 2001.
Xxxx Xxxxxxx
July 20, 2001
Page 4
July 20, 2001
Page 4
If you
have any question, please call me at (000) 000-0000.
| Very truly yours, | ||||
| DemandTec, Inc. | ||||
| /s/ Xxx Xxxxxxxx | ||||
| BY: Xxx Xxxxxxxx | ||||
| Title: President and Chief Executive Officer | ||||
I have read and accept this employment offer:
| /s/ Xxxx Xxxxxxx | ||||
| Signature of Xxxx Xxxxxxx | ||||
Dated:
|
7/30/01 | |||
Attachment
Exhibit A: Employee Proprietary Information and Inventions Agreement
February 11, 2005
Xx. Xxxx Xxxxxxx
Dear Xxxx:
We are pleased to inform you that on February 11, 2005, the Board of Directors of DemandTec,
Inc. (the “Company”) approved the following provisions for accelerated vesting of your option
shares. The following terms apply to all of your options granted or to be granted to you during
your employment with the Company, as well as any shares that you may have already purchased under
options previously granted to you (collectively, the “Options”).
1. Accelerated Vesting of Shares. The Company hereby agrees that, in the event that a Change
in Control occurs while you remain employed with the Company, then you will vest in that percentage
of your then unvested shares under each of the Options determined pursuant to the table below as of
the date of the Change in Control and the Company’s repurchase right shall lapse as to a
corresponding number of shares purchasable under each such Option. The percentage of shares
accelerated shall be calculated separately for each of your options. Any shares remaining unvested
under each of the Options after the date of the Change in Control shall vest and the Company’s
repurchase right shall lapse in equal monthly installments over the subsequent 12 months. The
Company hereby agrees that, in the event that a Change in Control occurs while you remain employed
with the Company and you are subject to an Involuntary Termination within 12 months after that
Change in Control, then you will vest in all of your shares under each of the Options such that you
are then fully vested and the Company’s repurchase right shall lapse as to all such shares.
| Year in which Change in | ||
| Control Occurs Following | Percentage of Unvested | |
| Grant Date | Shares Accelerated | |
| Year 1 | 50% | |
| Year 2 | 66.66% | |
| Year 3 | 75% | |
| Year 4 | 100% |
2. Severance. The first sentence in the section entitled “Severance” of your offer letter
dated July 20, 2001 (the “Offer Letter”) is hereby amended to read as follows: “If the Company
terminates your employment for any reason other than Cause or permanent disability,
then the Company will pay you a lump sum severance benefit in an amount equal to your base
Xx. Xxxx Xxxxxxx
February 11, 2005
Page 2
February 11, 2005
Page 2
salary for six months and you will be vested in an additional number of shares under all of your
Company options as if you had been employed for an additional six months.” Except as so modified,
the Offer Letter shall remain in full force and effect.
3. Definitions. For all purposes hereunder, the following terms shall be defined as specified
below:
A. “Cause” shall mean (a) any breach of the Proprietary Information and Inventions Agreement
between you and the Company; (b) conviction of, or a plea of “guilty” or “no contest” to, a felony
under the laws of the United States or any State or any crime involving moral turpitude; (c) your
participation in any fraud against the Company; or (d) your intentional damage to any material
property of the Company or other gross misconduct.
B. “Change in Control” shall mean (i) a sale, lease or other disposition of all or
substantially all of the assets of the Company, (ii) a merger or consolidation in which the Company
is not the surviving corporation, or (iii) a reverse merger in which the Company is the surviving
corporation but the shares of 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.
C. “Involuntary Termination” shall mean the termination of your Service by reason of: your
involuntary discharge by the Company (or the Parent or Subsidiary employing you) for reasons other
than Cause; or your voluntary resignation following the date that (i) you have been assigned to
duties which reflect a material adverse change in your authority or responsibility with the Company
or any successor, (ii) the annual rate of your base salary was reduced by the Company, or (iii) the
Company has relocated your principal place of work by a distance of 35 miles or more.
D. Capitalized terms not defined herein shall have the meaning ascribed to such terms in the
Plan.
4. Entire Agreement. This Agreement supersedes all prior agreements (whether verbal or
written) between you and the Company relating to the subject matter of acceleration of vesting of
option shares on an acquisition or other change in control of the Company. This Agreement
supplements the Offer Letter with respect to your rights to severance benefits in connection with a
termination of employment. Each of the option agreements evidencing Options previously granted to
you shall remain in full force and effect except to the extent necessary to give effect to the
terms of this Agreement.
5. Miscellaneous. This Agreement shall be binding upon the Company, its successors and
assigns (including, without limitation, the surviving entity or successor party resulting from the
Change in Control) and shall be construed and interpreted under the laws of the State of
California.
Xx. Xxxx Xxxxxxx
February 11, 2005
Page 3
February 11, 2005
Page 3
Please indicate your acceptance of the foregoing by signing the enclosed copy of this letter
and returning it to the Company.
| Very truly yours, Demandtec, Inc. |
||||
| By: | /s/ Xxx Xxxxxxxx | |||
| Name: | Xxx Xxxxxxxx | |||
| Title: | President & CEO | |||
Accepted and Agreed to:
/s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx
Xxxx Xxxxxxx
2/11/05
Date
Date
December 2, 2005
Xx. Xxxx Xxxxxxx
Dear Xxxx:
We are pleased to inform you that on December 2, 2005, the Board of Directors of DemandTec,
Inc. (the “Company”) approved the following amendment and restatement of the letter agreement dated
February 11, 2005, between you and the Company (the “Prior Agreement”).
1. General Rule on Accelerated Vesting. Except as provided in Section 2 below, the following
terms apply to all of the options granted or to be granted to you during your employment with the
Company, as well as any shares that you may have already purchased under options previously granted
to you (collectively, the “Options”). The Company hereby agrees that, in the event that a Change
in Control occurs while you remain employed with the Company, then you will vest in that percentage
of your then unvested shares under each of the Options determined pursuant to the table below as of
the date of the Change in Control and the Company’s repurchase right shall lapse as to a
corresponding number of shares purchasable under each such Option. The percentage of shares
accelerated shall be calculated separately for each of your options. Any shares remaining unvested
under each of the Options after the date of the Change in Control shall vest and the Company’s
repurchase right shall lapse in equal monthly installments over the subsequent 12 months. The
Company hereby agrees that, in the event that a Change in Control occurs while you remain employed
with the Company and you are subject to an Involuntary Termination within 12 months after that
Change in Control, then you will vest in all of your shares under each of the Options such that you
are then fully vested and the Company’s repurchase right shall lapse as to all such shares.
| Year in which Change in | ||
| Control Occurs Following | Percentage of Unvested | |
| Grant Date | Shares Accelerated | |
| Year 1 | 50% | |
| Year 2 | 66.66% | |
| Year 3 | 75% | |
| Year 4 | 100% |
2. Special Rule for December 2, 2005 Option. Section 1 above will apply to the option granted
to you on December 2, 2005 (the “2005 Option”), except as provided in this Section 2. If the
Company, within 60 days after December 1, 2005, receives a bona fide
Xx. Xxxx Xxxxxxx
December 2, 2005
Page 2
December 2, 2005
Page 2
term sheet with respect to the
acquisition (by merger, consolidation or otherwise) of the Company and such term sheet results in a
Change in Control while you remain employed with the Company, then you will vest in 25% of the then
unvested shares subject to the 2005 Option as of the date of such Change in Control and the
Company’s repurchase right will lapse as to a corresponding number of shares purchasable under the
2005 Option. Any shares remaining unvested under the 2005 Option after the date of such Change in
Control will vest, and the Company’s repurchase right will lapse, in equal monthly installments
over the subsequent 12 months. If such Change in Control occurs and you are subject to an
Involuntary Termination within 12 months after such Change in Control, then you will vest in all of
your shares under the 2005 Option such that you are then fully vested and the Company’s repurchase
right will lapse as to all such shares. In the event of a Change in Control that does not result
from a bona fide term sheet received within 60 days after December 1, 2005, Section 1 above will
apply to the 2005 Option.
3. Severance. Paragraph 5 of your offer letter dated July 20, 2001 (the “Offer Letter”) is
hereby amended in its entirety to read as follows:
“5. Severance Pay. If a Change in Control occurs while you remain employed
with the Company and you are subject to a Constructive Termination within 12 months
after that Change in Control, then the Company will pay you a lump sum severance
benefit in an amount equal to your base salary for six months. If the Company
terminates your employment for any reason other than Cause or permanent disability,
and if the preceding sentence does not apply, then the Company will pay you a lump
sum severance benefit in an amount equal to your base salary for six months and you
will be vested in an additional number of shares under all of your Company options
as if you had been employed for an additional six months. In either case, you will
be entitled to continuation of coverage under the medical, dental, life and
disability insurance programs maintained by Company to the extent such continuation
thereunder is permitted under the terms of the insurance contracts governing such
programs for a period of six months after the date of termination or Constructive
Termination or, in the alternative, reimbursement for all premiums paid to maintain
medical and dental coverage under the continuation coverage provisions of the
Consolidated Omnibus Budget Reconciliation Act of 1985 for a period of six months
after the date of termination or Constructive Termination. However, this Paragraph
5 will not apply unless you (a) have executed a general release (in a form
prescribed by the Company) of all known and unknown claims that you may then have
against the Company or persons affiliated with the Company and (b) have agreed not
to prosecute any legal action or other proceeding based on those claims.”
Except as so modified, the Offer Letter shall remain in full force and effect.
4. Definitions. For all purposes hereunder, the following terms shall be defined as specified
below:
Xx. Xxxx Xxxxxxx
December 2, 2005
Page 3
December 2, 2005
Page 3
A. “Cause” shall mean (a) any breach of the Proprietary Information and Inventions Agreement
between you and the Company; (b) conviction of, or a plea of “guilty” or “no contest” to, a felony
under the laws of the United States or any State or any crime involving moral turpitude; (c) your
participation in any fraud against the Company; or (d) your intentional damage to any material
property of the Company or other gross misconduct.
B. “Change in Control” shall mean (i) a sale, lease or other disposition of all or
substantially all of the assets of the Company, (ii) a merger or consolidation in which the Company
is not the surviving corporation, or (iii) a reverse merger in which the Company is the surviving
corporation but the shares of 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.
C. “Involuntary Termination” shall mean the termination of your Service by reason of: your
involuntary discharge by the Company (or the Parent or Subsidiary employing you) for reasons other
than Cause; or your voluntary resignation following the date that (i) you have been assigned to
duties which reflect a material adverse change in your authority or responsibility with the Company
or any successor, (ii) the annual rate of your base salary was reduced by the Company, or (iii) the
Company has relocated your principal place of work by a distance of 35 miles or more.
D. Capitalized terms not defined herein shall have the meaning ascribed to such terms in the
Company’s 1999 Equity Incentive Plan.
5. Entire Agreement. This Agreement supersedes all prior agreements (whether verbal or
written) between you and the Company relating to the subject matter of acceleration of vesting of
option shares on an acquisition or other change in control of the Company, including (without
limitation) the Prior Agreement. This Agreement supplements the Offer Letter with respect to your
rights to severance benefits in connection with a termination of employment. Each of the option
agreements evidencing Options granted to you shall remain in full force and effect except to the
extent necessary to give effect to the terms of this Agreement.
6. Miscellaneous. This Agreement shall be binding upon the Company, its successors and
assigns (including, without limitation, the surviving entity or successor party resulting from the
Change in Control) and shall be construed and interpreted under the laws of the State of
California.
Xx. Xxxx Xxxxxxx
December 2, 2005
Page 4
December 2, 2005
Page 4
Please indicate your acceptance of the foregoing by signing the enclosed copy of this letter
and returning it to the Company.
| Very truly yours, DemandTec, Inc. |
||||
| By: | /s/ Xxx Xxxxxxxx | |||
| Name: | Xxx Xxxxxxxx | |||
| Title: | President & CEO | |||
Accepted and Agreed to:
/s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx
Xxxx Xxxxxxx
12/2/05
Date
Date
