EMPLOYMENT OFFER LETTER DATED MARCH 23, 2010 BETWEEN GEEKNET, INC. AND JASON BAIRD
Exhibit
10.3
EMPLOYMENT
OFFER LETTER DATED MARCH 23, 2010 BETWEEN GEEKNET, INC. AND ▇▇▇▇▇
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March
23, 2010
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▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇
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Dear
▇▇▇▇▇,
I am
pleased to offer you the position of Chief Operations Officer at Geeknet, Inc.
(the “Company”). In this position you will report to ▇▇▇▇▇
▇▇▇▇▇▇▇▇, the Company’s President, Chief Executive Officer and
Director.
In
conjunction with this position, you will receive the following:
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Annual Base
Salary: You will receive an annual base salary of two hundred fifty
thousand dollars ($250,000.00), minus applicable tax
withholdings. Such compensation shall be paid bi-monthly in
accordance with normal Company payroll practices. I am sure you
recognize that the quotation of an annual salary rate is for purposes of
communication and is not intended to imply a specific condition or length
of employment.
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Discretionary
Bonus: Your Fiscal Year 2010 discretionary bonus will
range to the pro rata portion of fifty (50%) percent of your annual base
salary corresponding to the percentage of time during which you were a
Company employee, minus applicable withholding taxes, and will be based
upon Fiscal Year 2010 performance objectives, which were approved by the
Company’s Board of Directors. The awarding of a discretionary
bonus is in recognition of performance and should not be construed as
conferring upon you the right to continued employment with the Company or
to a future discretionary bonus.
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Stock
Option Plan: If you
accept this offer of employment, subject to approval by the Company’s
Board of Directors you will be granted a stock option (“Option”) to
purchase two hundred fifty thousand (250,000) shares of the Company’s
common stock. This Option is expected to be granted on
the last business day of the month in which your employment with the
Company begins. The Option price shall be the NASDAQ Global Market
Official Closing Price on the date of grant. This Option will vest
according to the following plan schedule: 25% vested after one year and
1/48th per month thereafter. You will be responsible for any taxes
associated with exercising the Option shares. The granting of
Options is wholly discretionary in nature, in recognition of performance
or anticipated performance, and does not create any obligation on the part
of the Company to maintain your employment through any part of the vesting
schedule or to grant additional options in the
future.
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Employee
Benefits: You will receive and be eligible to participate in the
Company’s normal employee benefits package, including health insurance
(medical, dental and vision insurance), life and disability insurances,
flexible spending account program as well as our 401(k) retirement
plan. You will also receive 15 working days of paid time off
(PTO) per year accrued bi-monthly on the basis of your length of
employment from your date of hire in a regular, full-time
position.
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March 23,
2010
Page
Two
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Other
Benefits: Geeknet, Inc. will also provide the following
in relation to your employment:
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Movement
of your household goods and personal effects from London, U.K. to the
Mountain View, CA area. This includes paying the cost of
storage for such household goods and personal effects in the Mountain View
area for up to six (6) months from the date you start working in Mountain
View;
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Short
term housing for you and your family for up to six (6) months from the
date you start working in Mountain View. Geeknet will provide
accommodations in up to a 2 bedroom dwelling for you and your family
during this time in Geeknet’s corporate
apartment;
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Rental
car for up to three (3) months from the date you start working in Mountain
View;
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Up
to two (2) house hunting trips for you and your family to secure housing
in the Mountain View area. Each trip includes roundtrip air
transportation for you and your family members; rental car, meals and
lodging for up to seven (7) days in the Mountain View
area;
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Reimbursement
of up to $2,000 in attorney’s fees associated with the review of Geeknet’s
employment documents (i.e., offer letter, employment
agreement);
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The
expenses paid on your behalf by Geeknet, Inc. associated with your relocation to
the Mountain View area (namely the cost of the movement of the household goods
and personal effects, short term housing, rental car, house hunting trips and
reimbursement of attorney’s fees) shall be immediately repayable to Geeknet if
you voluntarily resign or are terminated for Cause (as defined in the Employment
Agreement) on or before June 30, 2011. The aforementioned
expenses must be incurred in 2010 and the reimbursement or any payment made by
the Company must take place before March 15, 2011.
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Timeline:
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Provided
that you agree to the terms hereof, we expect the following timeline will apply
to your hiring and onboarding process:
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15
April: Start date with
Geeknet
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15
April - 23 April: Work in Mountain
View
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26
April - 14 May: Work from
London
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17
May - 31 May: Holiday, Transition from London, transition and
move to US (for the avoidance of doubt, you will be paid your normal
salary during the period and this will not be deemed to be using any of
your PTO days noted above)
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1
June: Arrive and begin work in Mountain
View
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At Will
Employment
Subject
to Section 7 of the Employment Agreement of evendate herewith attached hereto as
Exhibit A (the “Agreement”), your employment with Geeknet, Inc. is “at will” and
may be terminated by you or the Company at any time for any reason or no reason,
as permitted by law.
Entire
Agreement
This
offer of employment, and the Agreement constitute the entire agreement of the
parties hereto as to the subject matter herein and supersede and replace all
prior or contemporaneous agreements whether written or oral. Any
conflict between the provisions of this offer letter and the Agreement shall be
resolved in favor of the Agreement (including without limitation with respect to
stock options and other benefits). This
offer letter may not be amended or altered in any way by oral
statements. Terms of this offer are
confidential.
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March 23,
2010
Page
Three
Effectiveness of
Offer
This
offer of employment shall remain in effect until close of business on Friday,
March 26, 2010.
Additional
Requirements
At the
commencement of your employment, you will be required to sign Company policy
documents on a variety of topics, including confidentiality, conflict of
interest, business conduct and ethics. This offer is contingent on you
satisfactorily passing a background investigation and completion of reference
checks.
The
Immigration Reform Control Act requires employers to verify eligibility of all
personnel for employment in the United States. Enclosed is the
Eligibility Verification Form (INS form I-9), which specifies which documents
you are required to produce to establish such eligibility. Please
complete Part A of the I-9 and bring it and the required documentation with you
when you report for work on your first day.
At
Geeknet, Inc., we depend on the commitment, enthusiasm and skills of our team
members to lead the Company’s growth. Each person has both the luxury
and the duty to contribute to the future success of the Company in the most
meaningful way he or she can. We therefore expect you to play a key
role in the growth and success of our business. I look forward to
having you on the team and to working with you to carry out the vision and
mission of Geeknet, Inc.
Acceptance
Your
signature at the bottom of this page indicates your acceptance of this offer of
employment. Please sign and return a copy to me via fax (▇▇▇)
▇▇▇-▇▇▇▇ and/or mail.
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Sincerely
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I
accept this offer:
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/s/
▇▇▇▇▇ ▇▇▇
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/s/ ▇▇▇▇▇ ▇▇▇▇▇
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24 MARCH, 2010
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Date
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Sr.
Director, Human Resources
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Start
Date: April 15, 2010
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This
Employment Agreement (the “Agreement”) is made and entered into by and between
▇▇▇▇▇ ▇▇▇▇▇ (“Executive”) and Geeknet, Inc. (the “Company”), effective as of
March 23, 2010 (the “Effective Date”).
1. Duties and Scope of
Employment.
(a) Position and
Duties. Executive will serve as Chief Operations Officer of
the Company. Executive will render such business and professional
services in the performance of Executive’s duties, consistent with Executive’s
position within the Company, as will reasonably be assigned by the Company’s
President and Chief Executive Officer (“CEO”). The CEO may modify
Executive’s job title and duties as it deems necessary and appropriate in light
of the Company’s needs and interests from time to time. The period of
Executive’s employment under this Agreement is referred to herein as the
“Employment Term.”
(b) Obligations. Executive
will perform Executive’s duties faithfully and to the best of Executive’s
ability and will devote Executive’s full business efforts and time to the
Company. For the duration of the Employment Term, Executive agrees
not to actively engage in any other employment, occupation or consulting
activity for any direct or indirect remuneration without the prior approval of
the CEO.
2. At-Will
Employment. The Company and Executive acknowledge that
Executive’s employment is and will continue to be at-will, as defined under
applicable law. If Executive’s employment terminates for any reason,
including (without limitation) any termination prior to or following a Change of
Control, Executive will not be entitled to any acceleration of Award vesting or
severance pay based on termination of employment other than as provided by this
Agreement.
3. Compensation.
(a) Base
Salary. As of the Effective Date, the Company will pay
Executive an annual salary of Two Hundred Fifty Thousand Dollars and Zero Cents
($250,000.00) as compensation for Executive’s services (the “Base
Salary”). The Base Salary will be paid periodically in accordance
with the Company’s normal payroll practices and be subject to the usual,
required withholdings. Executive’s salary will be subject to review
and adjustments will be made based upon the Company’s normal performance review
practices for similarly situated employees, subject to Section 9(d)
below.
(b) Discretionary
Bonus. Executive will receive an annual discretionary bonus of
up to Fifty Percent (50%) of Executive’s Base Salary, less applicable
withholdings, upon achievement of performance objectives to be determined by the
Board in its sole discretion, pro-rata according to the length of employment
during the bonus period. For the avoidance of doubt, current
Company practice is to pay such bonus, if any, on a quarterly basis. Executive
will be eligible to participate in the Company’s Named Executive Officer Bonus
Policy and Plan.
(c) Equity. Executive
will be eligible to receive awards of stock options, restricted stock,
restricted stock units, stock appreciation rights, performance units and
performance shares or other equity awards (“Awards”) pursuant to any plans or
arrangements the Company may have in effect from time to time. For
the avoidance of doubt, the Offer Letter includes a one-time Award as described
therein. The Board or its committee will determine in its discretion
whether Executive will be granted any additional Awards and the terms of any
such Award in accordance with the terms of any applicable plan or arrangement
that may be in effect from time to time.
4. Employee
Benefits. Executive will be entitled to participate in the
employee benefit plans currently and hereafter maintained by the Company of
general applicability to other senior executives of the Company. The
Company reserves the right to cancel or change the benefit plans and programs it
offers to its employees at any time.
5. Vacation. Executive
will be entitled to paid vacation in accordance with the Company’s vacation
policy, with the timing and duration of specific vacations mutually and
reasonably agreed to by the parties hereto. Upon Executive’s
termination of employment, Executive will be entitled to receive Executive’s
accrued but unpaid vacation through the date of Executive’s
termination.
6. Expenses. The
Company will reimburse Executive for reasonable travel, entertainment or other
expenses incurred by Executive in the furtherance of or in connection with the
performance of Executive’s duties hereunder, in accordance with the Company’s
expense reimbursement policy as in effect from time to time.
7. Severance
Benefits.
(a) Termination for other than
Cause, Death or Disability Prior to a Change of Control or after Twelve Months
Following a Change of Control. If prior to a Change of Control
or after twelve (12) months following a Change of Control, the Company (or any
parent or subsidiary of the Company) terminates Executive’s employment other
than for Cause, death or Disability, then, subject to Section 7(c) below,
Executive will receive the following severance from the Company:
(i) Severance
Payment. Executive will receive: (A) continuing payments of
severance pay (less applicable withholding taxes) for a period of three (3)
months from the date of such termination equal to the pro-rata portion of
Executive’s Base Salary (as in effect immediately prior to Executive’s
termination) and (B) Executive’s quarterly bonus under the Company’s Named
Executive Officer Bonus Policy and Plan for the entire quarter in which such
termination occurred based on the achievement of the performance goals under
such plan and the quarterly bonus that would have otherwise been
earned.
(ii) Post-Termination Exercise
Period. Executive’s outstanding Awards will remain exercisable
for at least ninety (90) days following the date of such termination or such
longer period as prescribed in the respective stock plan and agreement for each
Award. Notwithstanding the foregoing, in no event may the Award be
exercised after its expiration date as provided in the respective agreement for
each Award.
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(iii) Continued Employee
Benefits. Executive will receive Company-paid coverage for a
period of three (3) months for the cost of continuation coverage for Executive
and Executive’s eligible dependents under the Company’s Benefit
Plans.
(b) Termination for other than
Cause, Death or Disability or Constructive Termination Within Twelve Months
Following a Change of Control. If within twelve (12) months
following a Change of Control, (i) the Company (or any parent or subsidiary of
the Company) terminates Executive’s employment other than for Cause, death or
Disability, or (ii) upon Executive’s Constructive Termination with the Company
(or any parent or subsidiary of the Company), then, subject to Section 7(c)
below, Executive will receive the following severance from the
Company:
(i) Severance
Payment. Executive will receive: (A) continuing payments of
severance pay (less applicable withholding taxes) for a period of six (6) months
from the date of such termination equal to the pro-rata portion of Executive’s
Base Salary (as in effect immediately prior to Executive’s termination) and (B)
Executive’s quarterly bonus under the Company’s Named Executive Officer Bonus
Policy and Plan for the entire quarter in which such termination occurred based
on the achievement of performance goals under such plan and the quarterly bonus
that would have otherwise been earned.
(ii) Accelerated
Vesting. If Executive holds unvested Awards, then the unvested
portion of each Award that would normally vest over the six (6) months following
termination will immediately vest and become exercisable. The Awards
will remain exercisable, to the extent applicable, following the termination for
the period prescribed in the respective stock plan and agreement for each
Award.
(iii) Post-Termination Exercise
Period. Executive’s outstanding Awards will remain exercisable
for at least ninety (90) days following the date of such termination or such
longer period as prescribed in the respective stock plan and agreement for each
Award. Notwithstanding the foregoing, in no event may the Award be
exercised after its expiration date as provided in the respective agreement for
each Award.
(iv) Continued Employee
Benefits. Executive will receive Company-paid coverage for a
period of six (6) months for the cost of continuation coverage for Executive and
Executive’s eligible dependents under the Company’s Benefit Plans.
(c) Separation and Release of
Claims Agreement. The receipt of any severance payments or
benefits pursuant to this Agreement is subject to the Executive signing and not
revoking a separation and release of claims agreement in a form reasonably
acceptable to the Company (the “Release”), which must become effective no later
than the 60th day
following the Executive’s termination of employment (the “Release Deadline”),
and if not, the Executive will forfeit any right to severance payments or
benefits under this Agreement. To become effective, the Release must
be executed by the Executive and any revocation periods (as required by statute,
regulation, or otherwise) must have expired without the Executive having revoked
the Release. In addition, no severance payments or benefits will be
paid or provided until the Release actually becomes effective. In the
event the Executive’s termination of employment occurs at a time during the
calendar year where the Release Deadline could occur in the calendar year
following the calendar year in which Executive’s termination occurs, then any
severance payments or benefits under this Agreement that would be considered
Deferred Compensation Separation Benefits (as defined in Section 7(h)) will be
paid on the first payroll date to occur during the calendar year following the
calendar year in which such termination occurs, or such later time as required
by (i) the payment schedule applicable to each payment or benefit as set forth
in Section 7(a) and 7(b), (ii) the date the Release becomes effective,
or (iii) Section 7(h).
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(d) Timing of Severance
Payments. The Company will pay the severance payments to which
Executive is entitled as salary continuation with the same timing as in effect
immediately prior to Executive’s termination of employment. If
Executive should die before all amounts have been paid, such unpaid amounts will
be paid in a lump sum payment (less any withholding taxes) to Executive’s
designated beneficiary, if living, or otherwise to the personal representative
of Executive’s estate.
(e) Voluntary Resignation;
Termination due to Death or Disability. If Executive’s
employment with the Company (or any parent or subsidiary of the Company)
terminates voluntarily by Executive (except upon Constructive Termination
following a Change of Control), or due to Executive’s death or Disability, then
(i) all vesting will terminate immediately with respect to Executive’s
outstanding Awards, (ii) all payments of compensation by the Company to
Executive hereunder will terminate immediately (except as to amounts already
earned through the date of termination), and (iii) Executive will not be
entitled to receive severance or other benefits except for those benefits (if
any) which do not concern acceleration of Award vesting or severance pay based
on termination of employment as may then be established under other Company
policies or programs, if any.
(f) Termination for
Cause. If Executive’s employment with the Company terminates
for Cause by the Company (or any parent or subsidiary of the Company), then (i)
all vesting will terminate immediately with respect to Executive’s outstanding
Awards, (ii) all payments of compensation by the Company to Executive hereunder
will terminate immediately (except as to amounts already earned as of the date
Executive receives written notification of Executive’s termination for Cause),
and (iii) Executive will not be entitled to receive severance or other benefits
except for those benefits (if any) which do not concern acceleration of Award
vesting or severance pay based on termination of employment as may then be
established under other Company policies or programs, if any.
(g) Exclusive
Remedy. In the event of a termination of Executive’s
employment with the Company (or any parent or subsidiary of the Company), the
provisions of this Section 7 are intended to be and are exclusive and in lieu of
any other rights or remedies to which Executive or the Company may otherwise be
entitled, whether at law, tort or contract, in equity, or under this
Agreement. Executive will be entitled to no severance or other
benefits upon termination of employment with respect to acceleration of Award
vesting or severance pay other than those benefits expressly set forth in this
Section 7.
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(h) Section
409A.
(i) Notwithstanding
anything to the contrary in this Agreement, if Executive is a “specified
employee” within the meaning of Section 409A at the time of Executive’s
termination, then, if required, the severance and benefits payable to Executive
pursuant to this Agreement (other than due to death), if any, and any other
severance payments or separation benefits which may be considered deferred
compensation under Section 409A (together, the “Deferred Compensation Separation
Benefits”), which are otherwise due to Executive on or within the six (6) month
period following Executive’s termination will accrue during such six (6) month
period and will become payable in a lump sum payment on the date six (6) months
and one (1) day following the date of Executive’s termination of employment or
the date of Executive’s death, if earlier. All subsequent Deferred
Compensation Separation Benefits, if any, will be payable in accordance with the
payment schedule applicable to each payment or benefit.
(ii) Any
amount paid under this Agreement that qualifies as a payment made as a result of
an involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii)
of the Treasury Regulations that does not exceed the Section 409A Limit (as
defined below) will not constitute Deferred Compensation Separation Benefits for
purposes of clause (i) above.
(iii) The
foregoing provisions are intended to comply with the requirements of Section
409A so that none of the severance payments and benefits to be provided
hereunder will be subject to the additional tax imposed under Section 409A, and
any ambiguities herein will be interpreted to so comply. Executive
and the Company agree to work together in good faith to consider amendments to
this Agreement and to take such reasonable actions which are necessary,
appropriate or desirable to avoid imposition of any additional tax or income
recognition prior to actual payment to Executive under Section
409A.
8. Limitation on
Payments. In the event that the severance and other benefits
provided for in this Agreement or otherwise payable to Executive (i) constitute
“parachute payments” within the meaning of Section 280G of the Internal Revenue
Code of 1986 (“Code”) and (ii) but for this Section 8, would be subject to the
excise tax imposed by Section 4999 of the Code, then Executive’s severance
benefits will be either:
(a) delivered
in full, or
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(b)
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delivered
as to such lesser extent which would result in no portion of such
severance benefits being subject to the excise tax under Section 4999 of
the Code,
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whichever
of the foregoing amounts, taking into account the applicable federal, state and
local income taxes and the excise tax imposed by Section 4999, results in the
receipt by Executive on an after-tax basis, of the greatest amount of severance
benefits, notwithstanding that all or some portion of such severance benefits
may be taxable under Section 4999 of the Code. If a reduction in the
severance and other benefits constituting “parachute payments” is necessary so
that no portion of such severance benefits is subject to the excise tax under
Section 4999 of the Code, the reduction shall occur in the following order
unless the Company determines in writing a different order: (1) reduction
of the severance payments under Sections 7(a)(i) or 7(b)(i); (2) cancellation of
accelerated vesting of Awards; and (3) reduction of continued employee
benefits. In the event that acceleration of vesting of Award
compensation is to be reduced, such acceleration of vesting shall be cancelled
in the reverse order of the date of grant of Executive’s Awards.
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Unless
the Company and Executive otherwise agree in writing, any determination required
under this Section 8 will be made in writing by an independent firm immediately
prior to Change of Control (the “Firm”), whose determination will be conclusive
and binding upon Executive and the Company for all purposes. For
purposes of making the calculations required by this Section 8, the Firm
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code. The Company and
Executive will furnish to the Firm such information and documents as the Firm
may reasonably request in order to make a determination under this
Section. The Company will bear all costs the Firm may reasonably
incur in connection with any calculations contemplated by this Section
8.
9. Definition of
Terms. The following terms referred to in this Agreement will
have the following meanings:
(a) Benefit
Plans. For purposes of this Agreement, “Benefit Plans” means
plans, policies or arrangements that the Company sponsors (or participates in)
and that immediately prior to Executive’s termination of employment provide
Executive and/or Executive’s eligible dependents with medical, dental and vision
benefits. Benefit Plans do not include any other type of benefit
(including, but not by way of limitation, disability, life insurance or
retirement benefits). A requirement that the Company provide Executive and
Executive’s eligible dependents with coverage under the Benefit Plans will not
be satisfied unless the coverage is no less favorable than that provided to
senior executives of the Company at any applicable time during the period
Executive is entitled to receive severance pursuant to Section 7. The
Company may, at its option, satisfy any requirement that the Company provide
coverage under any Benefit Plan by (i) reimbursing Executive’s premiums
under Title X of the Consolidated Budget Reconciliation Act of 1985, as
amended (“COBRA”) after Executive has properly elected continuation coverage
under COBRA (in which case Executive will be solely responsible for electing
such coverage for Executive’s eligible dependents), or (ii) providing
coverage under a separate plan or plans providing coverage that is sufficient to
provide Executive and Executive’s eligible dependents with equivalent coverage
that is reasonably available to Executive and/or Executive’s eligible
dependents.
(b) Cause. “Cause”
is defined as a determination by the Company of any of the following: (i) any
material act of personal dishonesty involving Executive in connection with
Executive’s material responsibilities as an employee of the Company which
results in harm to the Company; (ii) Executive’s conviction of, or plea of
guilty or nolo contendere to, a felony;
(iii) a willful act by Executive which constitutes gross misconduct and which is
injurious to the Company; (iv) continued violations by Executive of Executive’s
obligations as an employee of the Company which are demonstrably willful and
deliberate on Executive’s part after there has been delivered to Executive a
written demand for performance from the Company which describes the basis for
the Company's belief that Executive has not substantially performed Executive’s
duties (unless such violation by its nature cannot be cured, in which case
notice and an opportunity to cure shall not be required); or (v) Executive’s
arrest for any crime involving fraud, embezzlement or any other act of moral
turpitude.
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(c) Change of
Control. “Change of Control” means the occurrence of any of
the following events:
(i) the
acquisition by any one person, or more than one person acting as a group (for
these purposes, persons will be considered to be acting as a group if they are
owners of a corporation that enters into a merger, consolidation, purchase or
acquisition of stock, or similar business transaction with the Company),
(“Person”) that or is or becomes the owner, directly or indirectly, of
securities of the Company representing more than fifty percent (50%) of the
total voting power represented by the Company’s then outstanding securities (the
“Voting Securities”); provided, however, that for purposes of this subsection
(i), the acquisition of additional securities by any one Person, who is
considered to own more than fifty percent (50%) of the total voting power of the
securities of the Company shall not be considered a Change of Control;
or
(ii) a
change in the ownership of a substantial portion of the Company’s assets which
occurs on the date that any Person acquires (or has acquired during the twelve
(12) month period ending on the date of the most recent acquisition by such
person or persons) assets from the Company that have a total gross fair market
value equal to or more than fifty percent (50%) of the total fair market value
of all of the assets of the Company immediately prior to such acquisition or
acquisitions; provided, however, that for purposes of this Section 9(c)(ii) the
following shall not constitute a change in the ownership of a substantial
portion of the Company’s assets: (1) a transfer to an entity that is controlled
by the Company’s shareholders immediately after the transfer; or (2) a transfer
of assets by the Company to: (A) a shareholder of the Company (immediately
before the asset transfer) in exchange for or with respect to the Company’s
securities; (B) an entity, fifty percent (50%) or more of the total value or
voting power of which is owned, directly or indirectly, by the Company; (C) a
Person, that owns, directly or indirectly, fifty percent (50%) or more of the
total value or voting power of all the outstanding stock of the Company; or (D)
an entity, at least fifty percent (50%) of the total value or voting power of
which is owned, directly or indirectly, by a Person described in subsection
(C). For purposes of this Section 9(c)(ii), gross fair market value
means the value of the assets of the Company, or the value of the assets being
disposed of, determined without regard to any liabilities associated with such
assets.
Notwithstanding the foregoing, a transaction shall not
constitute a Change of Control if: (i) its sole purpose is to change the
state of the Company’s incorporation; (ii) its sole purpose is to create a
holding company that will be owned in substantially the same proportions by the
persons who held the Company’s securities immediately before such transaction;
or (iii) it does not constitute a change in control event under Treasury
Regulation 1.409A-3(i)(5)(v) or (vii).
(d) Constructive
Termination. “Constructive Termination” means Executive’s
resignation within thirty (30) days following the expiration of any Company cure
period (discussed below) following the occurrence of one or more of the
following events without Executive’s consent: (i) the assignment to Executive of
any duties or the reduction of Executive’s duties, including without limitation
if Executive is no longer a direct report to the Company’s Chief Executive
Officer, either of which results in a material diminution in Executive’s
authority, duties or responsibilities with the Company in effect immediately
prior to such assignment, or the removal of Executive from such position and
responsibilities, unless Executive is provided with comparable authority, duties
or responsibilities; provided, however, it being understood that a
new position within a larger combined company does not constitute
“Constructive Termination” if it is in the same
area of operations and involves similar scope of management responsibility
notwithstanding that Executive may not retain as senior a position overall
within the larger combined company as Executive’s prior position; (ii) a
material reduction of Executive’s Base Salary; (iii) a material change in the
geographic location at which Executive must perform services (for purposes of
this Agreement, the relocation of Executive to a facility or a location less
than fifty (50) miles from Executive’s then-present location shall not be
considered a material change in geographic location); or (iv) any material
breach by the Company of any material provision of this
Agreement. Executive will not resign for Constructive Termination
without first providing the Company with written notice of the acts or omissions
constituting the grounds for “Constructive Termination” within ninety (90) days
of the initial existence of the grounds for “Constructive Termination” and a
reasonable cure period of not less than thirty (30) days following the date of
such notice.
-7-
(e) Disability. “Disability”
will mean that Executive has been unable to perform Executive’s Company duties
as the result of Executive’s incapacity due to physical or mental illness, and
such inability, at least twenty-six (26) weeks after its commencement, is
determined to be total and permanent by a physician selected by the Company or
its insurers and acceptable to Executive or Executive’s legal representative
(such Agreement as to acceptability not to be unreasonably
withheld). Termination resulting from Disability may only be effected
after at least thirty (30) days’ written notice by the Company of its intention
to terminate Executive’s employment. In the event that Executive
resumes the performance of substantially all of Executive’s duties hereunder
before the termination of Executive’s employment becomes effective, the notice
of intent to terminate will automatically be deemed to have been
revoked.
(f) Section 409A
Limit. For purposes of this Agreement, “Section 409A Limit”
means the lesser of two (2) times: (i) Executive’s annualized compensation based
upon the annual rate of pay paid to Executive during the Company’s taxable year
preceding the Company’s taxable year of Executive’s termination of employment as
determined under Treasury Regulation 1.409A-1(b)(9)(iii)(A)(1) and any Internal
Revenue Service guidance issued with respect thereto; or (ii) the maximum
amount that may be taken into account under a qualified plan pursuant to
Section 401(a)(17) of the Code for the year in which Executive’s employment
is terminated.
10. Successors.
(a) The Company’s
Successors. Any successor to the Company (whether direct or
indirect and whether by purchase, merger, consolidation, liquidation or
otherwise) to all or substantially all of the Company’s business and/or assets
will assume the obligations under this Agreement and agree expressly to perform
the obligations under this Agreement in the same manner and to the same extent
as the Company would be required to perform such obligations in the absence of a
succession. For all purposes under this Agreement, the term “Company”
will include any successor to the Company’s business and/or assets which
executes and delivers the assumption agreement described in this Section 10(a)
or which becomes bound by the terms of this Agreement by operation of
law. The failure of the Company to obtain the assumption of this
Agreement by any successor will constitute a material breach of a material part
of this Agreement.
-8-
(b) Executive’s
Successors. The terms of this Agreement and all rights of
Executive hereunder will inure to the benefit of, and be enforceable by,
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.
11. Notice.
(a) General. Notices
and all other communications contemplated by this Agreement will be in writing
and will be deemed to have been duly given when personally delivered or when
mailed by U.S. registered or certified mail, return receipt requested and
postage prepaid. In the case of Executive, mailed notices will be
addressed to Executive at the home address which Executive most recently
communicated to the Company in writing. In the case of the Company,
mailed notices will be addressed to its corporate headquarters, and all notices
will be directed to the attention of the CEO.
(b) Notice of
Termination. Any termination by the Company for Cause or by
Executive for Constructive Termination or as a result of a voluntary resignation
by Executive will be communicated by a notice of termination to the other party
hereto given in accordance with Section 11(a) of this Agreement. Such
notice will indicate the specific termination provision in this Agreement relied
upon, will set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination under the provision so indicated, and will
specify the termination date (which will be not more than thirty (30) days after
the giving of such notice). The failure by Executive to include in
the notice any fact or circumstance which contributes to a showing of
Constructive Termination will not waive any right of Executive hereunder or
preclude Executive from asserting such fact or circumstance in enforcing
Executive’s rights hereunder.
12. Arbitration.
(a) Arbitration. In
consideration of Executive’s employment with the Company, its promise to
arbitrate all employment-related disputes, and
Executive’s receipt of the compensation, pay raises and other benefits paid to
Executive by the Company, at present and in the future, Executive agrees that
any and all controversies, claims, or disputes with anyone (including the
Company and any employee, officer, director, shareholder or benefit plan of the
Company in their capacity as such or otherwise) arising out of, relating to, or
resulting from Executive’s employment with the Company or termination thereof,
including any breach of this Agreement, will be subject to binding arbitration
under the Arbitration Rules set forth in California Code of Civil Procedure
Section 1280 through 1294.2, including Section 1281.8 (the “Act”), and
pursuant to California law. The Federal Arbitration Act shall also
continue to apply with full force and effect, notwithstanding the application of
procedural rules set forth under the Act.
(b) Dispute
Resolution. Disputes that Executive agrees to
arbitrate, and thereby agrees to waive any right to a trial by jury, include any
statutory claims under local, state, or federal law, including, but not
limited to, claims under Title VII of the Civil Rights Act of 1964, the
Americans with Disabilities Act of 1990, the Age Discrimination in Employment
Act of 1967, the Older Workers Benefit Protection Act, the Sarbanes Oxley Act,
the Worker Adjustment and Retraining Notification Act, the California Fair
Employment and Housing Act, the Family and Medical Leave Act, the California
Family Rights Act, the California Labor Code, Claims of harassment,
discrimination, and wrongful termination, and any statutory or common law
claims. Executive further understands that this Agreement to
arbitrate also applies to any disputes that the Company may have with
Executive.
-9-
(c) Procedure. Executive
agrees that any arbitration will be administered by the Judicial Arbitration
& Mediation Services, Inc. (“JAMS”), pursuant to its Employment Arbitration
Rules & Procedures (the “JAMS Rules”). The arbitrator shall have
the power to decide any motions brought by any party to the arbitration,
including motions for summary judgment and/or adjudication, motions to dismiss
and demurrers, and motions for class certification, prior to any arbitration
hearing. The arbitrator shall have the power to award any remedies
available under applicable law, and the arbitrator shall award attorneys’ fees
and costs to the prevailing party, except as prohibited by law. The
Company will pay for any administrative or hearing fees charged by the
administrator or JAMS, except that Executive shall pay any filing fees
associated with any arbitration that Executive initiates, but only so much of
the filing fee as Executive would have instead paid had Executive filed a
complaint in a court of law. Executive agrees that the arbitrator
shall administer and conduct any arbitration in accordance with California law,
including the California Code of Civil Procedure, and that the arbitrator shall
apply substantive and procedural California law to any dispute or claim, without
reference to the rules of conflict of law. To the extent that the
JAMS Rules conflict with California law, California law shall take
precedence. The decision of the arbitrator shall be in
writing. Any arbitration under this Agreement shall be conducted in
Santa ▇▇▇▇▇ County, California.
(d) Remedy. Except
as provided by the Act, arbitration shall be the sole, exclusive, and final
remedy for any dispute between Executive and the Company. Accordingly, except as provided by
the Act and this Agreement, neither Executive nor the Company will be permitted
to pursue court action regarding claims that are subject to
arbitration. Notwithstanding, the arbitrator will not have the
authority to disregard or refuse to enforce any lawful Company policy, and the
arbitrator will not order or require the Company to adopt a policy not otherwise
required by law which the Company has not adopted.
(e) Administrative
Relief. Executive is not prohibited from pursuing an
administrative claim with a local, state, or federal administrative body or
government agency that is authorized to enforce or administer laws related to
employment, including, but not limited to, the Department of Fair Employment and
Housing, the Equal Employment Opportunity Commission, the National Labor
Relations Board, or the Workers’ Compensation Board. However,
Executive may not pursue court action regarding any such claim, except as
permitted by law.
(f) Voluntary Nature of
Agreement. Executive acknowledges and agrees that Executive is
executing this Agreement voluntarily and without any duress or undue influence
by the Company or anyone else. Executive further acknowledges and
agrees that Executive has carefully read this Agreement and that Executive has
asked any questions needed for Executive to understand the terms, consequences
and binding effect of this Agreement and fully understands it, including that
EXECUTIVE
IS WAIVING EXECUTIVE’S RIGHT TO A JURY TRIAL. Finally,
Executive agrees that Executive has been provided an opportunity to seek the
advice of an attorney of Executive’s choice before signing this
Agreement.
-10-
13. Miscellaneous
Provisions.
(a) No Duty to
Mitigate. Executive will not be required to mitigate the
amount of any payment contemplated by this Agreement, nor will any such payment
be reduced by any earnings that Executive may receive from any other
source.
(b) Amendment. No
provision of this Agreement will be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by
Executive and by an authorized officer of the Company (other than Executive)
that is expressly designated as an amendment to this Agreement.
(c) Waiver. No
waiver by either party of any breach of, or of compliance with, any condition or
provision of this Agreement by the other party will be considered a waiver of
any other condition or provision or of the same condition or provision at
another time.
(d) Headings. All
captions and section headings used in this Agreement are for convenient
reference only and do not form a part of this Agreement.
(e) Entire
Agreement. The Offer Letter of evendate herewith and this
Agreement constitute the entire agreement of the parties hereto as to the
subject matter herein and supersedes and replaces all prior or contemporaneous
agreements whether written or oral including. Executive acknowledges
and agrees that this Agreement encompasses all the rights of Executive to any
acceleration of Award vesting or severance pay based on termination of
employment and Executive hereby agrees that he or she has no such rights except
as stated herein, and Executive agrees that any such rights, whether in an
employment agreement, offer letter, stock option agreement, stock option plan or
other agreement, are hereby waived.
(f) Choice of
Law. The validity, interpretation, construction and
performance of this Agreement will be governed by the laws of the State of
California (with the exception of its conflict of laws provisions).
(g) Severability. The
invalidity or unenforceability of any provision or provisions of this Agreement
will not affect the validity or enforceability of any other provision hereof,
which will remain in full force and effect.
(h) Withholding. All
payments made pursuant to this Agreement will be subject to all applicable
withholdings, including all applicable income and employment taxes, as
determined in the Company’s reasonable judgment.
(i) Counterparts. This
Agreement may be executed in counterparts, each of which will be deemed an
original, but all of which together will constitute one and the same
instrument.
IN
WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of
the Company by its duly authorized officer, as of the day and year set forth
below.
-11-
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COMPANY
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GEEKNET,
INC.
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By:
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/s/ ▇▇▇▇▇ ▇▇▇
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Title:
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Sr Director, Human
Resources
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EXECUTIVE
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇
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||
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Title:
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▇▇▇▇▇ ▇▇▇▇▇
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March 24, 2010
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||||
-12-
Amendment
to the March 23, 2010 Offer Letter (“Amendment”)
This
Amendment by and between ▇▇▇▇▇ ▇. ▇▇▇▇▇ and Geeknet, Inc. hereby amends that
certain Offer Letter dated March 23, 2010 (“Offer Letter”).
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1.
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The
first and second sentences of the paragraph titled “Stock Option Plan” are
hereby deleted and replaced as
follows:
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“If
you execute this Amendment, you will be granted, as of the date of
commencement of your employment, a stock option (“Option”) to purchase two
hundred fifty thousand (250,000) shares of the Company’s common
stock. This Option has been approved by the Compensation
Committee of the Company’s Board of
Directors.”
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2.
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The
second sentence of the paragraph titled “Entire Agreement” hereby deleted
and replaced as follows:
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“Any
conflict between the provisions of this offer letter and the Agreement
shall be resolved in favor of this offer
letter.”
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2.
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All
other provisions of the Offer Letter remain in full force and
effect. This Amendment, the Offer Letter and the Employment
Agreement dated March 23, 2010 constitute the entire understanding of the
parties on the subject matter
hereof.
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Geeknet,
Inc.
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/s/
▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇
▇. ▇▇▇▇▇
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/s/▇▇▇▇
▇▇▇▇▇▇
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05
MAY 2010
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Name
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Date
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General
Counsel
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||||
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Title
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||||
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May
5, 2010
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Date
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