Ex. 10.5
EMPLOYMENT AGREEMENT
This Employment Agreement is made and entered into by and between
iPrint, inc. (the "Company") and Xx Xxxxxx ("Employee") as of April 29, 1999
(the "Effective Date").
1. POSITION AND DUTIES: Employee shall be employed by the Company
as its Chief Marketing Officer, reporting to the Company's Chief Executive
Officer. As its Chief Marketing Officer, Employee agrees to devote his full
business time, energy and skill to his duties at the Company. These duties
shall include all those duties customarily performed by the Chief Marketing
Officer.
2. TERM OF EMPLOYMENT: Employee's employment with the Company will
be for no specified term, and may be terminated by Employee or the Company at
any time, with or without cause. Employee is requested to give Company two
(2) months advanced notice of departure. Upon the termination of Employee's
employment with the Company, for any reason, neither Employee nor the Company
shall have any further obligation or liability under this Agreement to the
other, except as set forth in paragraphs 6, 7, 8, 9, 10 14 and 15 below.
3. COMPENSATION: Employee shall be compensated by the Company,
while an employee, for his services as follows:
(a) BASE SALARY: As Chief Marketing Officer, Employee shall
be paid a monthly Base Salary of $12,500 per month ($150,000 on an annualized
basis), subject to applicable withholding, in accordance with the Company's
normal payroll procedures. The Base Salary may be reviewed and modified
periodically.
(b) BENEFITS: Employee shall have the right, on the same
basis as other members of senior management of the Company, to participate in
and to receive benefits under any of the Company's employee benefit plans, as
such plans may be modified from time to time. In addition, Employee shall be
entitled to the benefits afforded to other members of senior management under
the Company's vacation, holiday and business expense reimbursement policies.
(c) PERFORMANCE BONUSES. Employee shall have the
opportunity to earn a Performance Bonus. This Performance Bonus shall be
based upon the achievement of certain fiscal and performance-based objectives
as agreed to by Employee and the CEO. The Target Bonus for the first 12
fiscal months of Employee's employment shall be $50,000 (less applicable
withholdings). This Performance Bonus is guaranteed for the first year of
Employee's employment, and will be paid on a monthly basis ($4,166.67 per
month) so long as Employee remains employed by the Company.
(d) STOCK OPTIONS: Employee shall be granted the option to
purchase 250,000 shares of the Common Stock of the Company (the "Options"). The
Options shall vest over a four-year period as follows: 25% upon the first
anniversary of the Effective Date of this agreement and 2.0833% per month during
the succeeding thirty-six (36) month period. Except as
otherwise provided in this Agreement, such options shall be subject to the
terms of the Company's Stock Option Plan and the standard option agreements
provided pursuant to the plan. Options will be granted at .21 cents per share.
(e) RELOCATION EXPENSES. Employee will be reimbursed for
the following expenses incurred in connection with his relocation from
Connecticut to the San Francisco Bay Area:
(1) Reasonable travel expenses up to $2,400,
including airline flights, for bona fida travel between your Connecticut home
and the Bay Area through August 1, 1999;
(2) Temporary housing expenses up to $5,000 based
on rental receipts for lodging in the Bay Area through August 1, 1999; and
(3) Reasonable moving expenses based on bona fida
moving company receipts as of August 31, 1999. Three estimates must be
obtained, including one from a moving company recommended by Company. The
Company will reimburse expenses in an amount equivalent to the lowest
estimate obtained.
If, during the six months following the Effective Date of this
Agreement, either: (i) Employee voluntarily terminates his employment
relationship with the Company; or (ii) the Company terminates Employee's
employment relationship for "Cause" as defined in paragraph 5(a) of the
Agreement, Employee will reimburse the Company for all of the expenses paid
pursuant to this paragraph 3(e).
4. BENEFITS UPON TERMINATION: In the event of Employee's voluntary
termination from employment with the Company, or in the event that Employee's
employment terminates as a result of his death or disability (defined as the
inability to perform the essential functions of Employee's position for a
period of at least 180 days), Employee shall be entitled to no compensation
or benefits from the Company other than those earned under paragraph 3 above
through the date of his termination or in the case of any stock options,
vested through the date of his termination.
5. BENEFITS UPON OTHER TERMINATION. Employee agrees that his
employment may be terminated by the Company at any time, with or without
cause. In the event of the termination of Employee's employment by the
Company for the reasons set forth below, he shall be entitled to the
following:
(a) TERMINATION FOR CAUSE: If Employee's employment is
terminated by the Company for cause as defined below, Employee shall be
entitled to no compensation or benefits from the Company other than those
earned under paragraph 3, or in the case of any stock options, vested through
the date of his termination.
For purposes of this Agreement, a termination "for cause" occurs if
Employee is terminated for, but not limited to, any of the following reasons:
(1) theft, dishonesty, or falsification
of any employment or Company records;
(2) conviction of a felony or any act
involving moral turpitude;
(3) poor performance, as determined by
the Board in its sole discretion, based on reasonable business objectives,
after written notice from Company and a reasonable opportunity to correct
such poor performance.
(4) improper disclosure of the Company's
confidential or proprietary information;
(5) any intentional act by Employee that
has a material detrimental effect on the Company's reputation or business; or
(6) any material breach of this
Agreement, which breach, if curable, is not cured within thirty (30) days
following written notice of such breach from the Company.
(b) TERMINATION WITHOUT CAUSE: If Employee's employment is
terminated by the Company for any reason other than for cause, Employee shall
be entitled to the following separation benefits:
(i) all accrued compensation (including pro-rated
Performance Bonus) and benefits through the date of termination; and
(ii) in the event that Employee's employment is
terminated within one year following the Effective Date, Employee shall
receive:
(a) vesting in the Options described in
paragraph 3(d), above, as if Employee had remained employed by the Company
for one full year; and
(b) a lump sum payment equivalent to one
(1) week of Base Salary plus Monthly Bonus for each month of employment, less
applicable withholding; or
(iii) in the event that Employee's employment is
terminated on or after one year following the Effective Date, Employee shall
receive:
(a) additional vesting in the Options
described in paragraph 3(d), above, in the total amount of one-half of the
Options that were unvested as of the date of the termination; and
(b) a lump sum payment equivalent to
three (3) months of Base Salary, less applicable withholding.
6. EMPLOYEE NON-DISCLOSURE AND PROPRIETARY RIGHTS ASSIGNMENT
AGREEMENT: Employee agrees to abide by the terms and conditions of the
Company's standard Employee Non-Disclosure and Proprietary Rights Assignment
Agreement as executed by Employee and attached hereto as EXHIBIT A.
7. AGREEMENT NOT TO COMPETE UNFAIRLY: Employee agrees that in the
event of his termination at any time and for any reason, he shall not compete
with the Company in any unfair manner, including, without limitation, using
any confidential or proprietary information of the Company to compete with
the Company in any way.
8. NON-SOLICITATION: Employee agrees that for a period of two
years after the date of the termination of his employment for any reason, he
shall not, either directly or indirectly, solicit the services, or attempt to
solicit the services, of any employee of the Company to any other person or
entity.
9. DISPUTE RESOLUTION: In the event of any dispute or claim
relating to or arising out of this Agreement (including, but not limited to,
any claims of breach of contract, termination under Section 5.a.(3), wrongful
termination or age, sex, race or other discrimination), Employee and the
Company agree that all such disputes shall be fully and finally resolved by
binding arbitration conducted by the American Arbitration Association in San
Francisco, California in accordance with its National Employment Dispute
Resolution rules, as those rules are currently in effect (and not as they may
be modified in the future). Employee acknowledges that by accepting this
arbitration provision he is waiving any right to a jury trial in the event of
such dispute. Provided, however, that this arbitration provision shall not
apply to any disputes or claims relating to or arising out of the misuse or
misappropriation of trade secrets or proprietary information.
10. ATTORNEYS' FEES: The prevailing party shall be entitled to
recover from the losing party its attorneys' fees and costs incurred in any
action brought to enforce any right arising out of this Agreement.
11. INTERPRETATION: Employee and the Company agree that this
Agreement shall be interpreted in accordance with and governed by the laws of
the State of California.
12. SUCCESSORS AND ASSIGNS: This Agreement shall inure to the
benefit of and be binding upon the Company and its successors and assigns. In
view of the personal nature of the services to be performed under this
Agreement by Employee, he shall not have the right to assign or transfer any
of his rights, obligations or benefits under this Agreement, except as
otherwise noted herein.
13. ENTIRE AGREEMENT: This Agreement constitutes the entire
employment agreement between Employee and the Company regarding the terms and
conditions of his employment, with the exception of (i) the agreement
described in paragraph 6 and (ii) any stock option agreements between
Employee and the Company. This Agreement (including the documents described
in (i) and (ii) herein) supersedes all prior negotiations, representations or
agreements between Employee and the Company, whether written or oral,
concerning Employee's employment by the Company.
14. VALIDITY: If any one or more of the provisions (or any part
thereof) of this Agreement shall be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions (or any part thereof) shall not in any way be affected or impaired
thereby.
15. MODIFICATION: This Agreement may only be modified or amended by
a supplemental written agreement signed by Employee and the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date and year written below.
iPrint, inc.
Date: 26 APRIL 1999 By: /S/ ROYAL FARROS
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Its: CEO
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Date: 4/26/99 /S/ XX XXXXXX
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Xx Xxxxxx
