Re: EMPLOYMENT AGREEMENT
Dear [Employee Name]:
On behalf of [Company Name], a Delaware corporation (the “Company”), I am pleased to offer you the position of [Title] of the Company. Your employment by the Company shall be governed by the following terms and conditions (this “Agreement”):a asdf asdf asdf asd fasd
- Duties and Scope of Employment.
- Position. For the term of your employment under this Agreement (your “Employment”), the Company agrees to employ you in the position of [Title] [or in such other position as the Company subsequently may assign to you]. You will report to the Company’s [Board of Directors / CEO / CFO / CTO] [or to such other person as the Company subsequently may determine]. You will be working out of the Company’s office in the San Francisco Bay Area. You will perform the duties and have the responsibilities and authority customarily performed and held by an employee in your position or as otherwise may be assigned or delegated to you by the Company’s [Board of Directors / CEO / CFO / CTO] [,including but not limited to Duties and Responsibilities].
- Obligations to the Company. During your Employment, you shall devote your full business efforts and time to the Company. During your Employment, without the prior written approval of the Company’s Chief Executive Officer, [which approval shall not be unreasonably withheld,] you shall not render services in any capacity to any other person or entity and shall not act as a sole proprietor or partner of any other person or entity or own more than five percent of the stock of any other corporation. [Notwithstanding the foregoing, you may serve on corporate, civic or charitable boards or committees, deliver lectures, fulfill speaking engagements, teach at educational institutions, or manage personal investments without such advance written consent, provided that such activities do not individually or in the aggregate interfere with the performance of your duties under this Agreement.] You shall comply with the Company’s policies and rules, as they may be in effect from time to time during your Employment.
- No Conflicting Obligations. You represent and warrant to the Company that you are under no obligations or commitments, whether contractual or otherwise, that are inconsistent with your obligations under this Agreement. In connection with your Employment, you shall not use or disclose any trade secrets or other proprietary information or intellectual property in which you or any other person has any right, title or interest and your Employment will not infringe or violate the rights of any other person. You represent and warrant to the Company that you have returned all property and confidential information belonging to any prior employer.
- Commencement Date. You shall commence full-time Employment as soon as reasonably practicable and in no event later than [Absolute Start Date].
- Cash and Incentive Compensation.
- Salary. The Company shall pay you as compensation for your services an initial base [monthly] / [annual] salary at a gross rate of $[Rate]. Such [monthly] / [annual] salary shall be payable in accordance with the Company’s standard payroll procedures. The annual compensation specified in this subsection (a), together with any modifications in such compensation that the Company may make from time to time, is referred to in this Agreement as “Base Salary.” [The Board or any Compensation Committee of the Board shall review your Base Salary at least annually. Effective as of the date of any change to your Base Salary, the Base Salary as so changed shall be considered the new Base Salary for all purposes of this Agreement.]
- [Incentive Bonuses. You will be eligible to be considered for an annual incentive bonus each calendar year during the term of your employment under this Agreement based upon the achievement of certain objective or subjective criteria established by the Company’s Board of Directors (the “Board”) or any Compensation Committee of the Board. The target amount for any such annual incentive bonus will be up to [Incentive Bonus Target]% of your Base Salary. The determinations of the Board with respect to such bonus shall be final and binding. You shall not earn an incentive bonus unless you are employed by the Company on the date when such bonus is payable.]
- [Signing Bonus. The Company shall pay you a signing bonus of $[Signing Bonus] (the “Signing Bonus”) on or about the first day of your Employment, net of all applicable withholding taxes and other applicable deductions in accordance with the Company’s standard payroll practices.]
- [Up-Front Retention Bonus. The Company shall pay you a retention bonus of $[Retention Bonus] (the “Retention Bonus”) on or about the first day of your Employment, net of all applicable withholding taxes and other applicable deductions in accordance with the Company’s standard payroll practices. You will earn and be permitted to retain the full amount of the Retention Bonus if you are employed by the Company on the __-month anniversary of this Agreement. If you resign from the Company before such time, you will be required to immediately return the gross pre-tax amount of the Retention Bonus to the Company.]
- [Relocation. In order to assist you to move yourself and your household from [Current City] to the San Francisco Bay Area, the Company will reimburse you up to an amount that will not exceed $[Relocation Reimbursement Max] to cover your actual relocation expenses incurred for the following items: closing costs on the sale of your home in [Home's Location], transportation from [Current City] to the San Francisco Bay Area, storage of household goods and temporary housing in the San Francisco Bay Area (the “Relocation Payment”). The Relocation Payment shall be made to you net of all applicable withholding taxes and other applicable deductions in accordance with the Company’s standard payroll practices.] [You will earn and be permitted to retain the full amount of the Relocation Payment if you are employed by the Company on the __-month anniversary of this Agreement. If you resign from the Company before such time, you will be required to immediately return the gross pre-tax amount of the Relocation Payment to the Company.]
- [Sales Compensation. In addition to your Base Salary, you are eligible to participate in the Company’s [Sales Incentive Plan Name] (the “Sales Incentive Plan”), subject to your execution of an acknowledgment of the terms of your participation in the Sales Incentive Plan (such form will be included in the plan documents which will be provided to you shortly).]
- [Stock Options. Subject to the approval of the Company’s Board of Directors (the “Board”), the Company shall grant you a stock option covering [Option Shares] shares of the Company’s Common Stock (the “Option”). The Option shall be granted as soon as reasonably practicable after the date of this Agreement or, if later, the date you commence fulltime Employment. The exercise price per share will be equal to the fair market value per share on the date the Option is granted, as determined by the Company’s Board of Directors in good faith compliance with applicable guidance in order to avoid having the Option be treated as deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended. There is no guarantee that the Internal Revenue Service will agree with this value. You should consult with your own tax advisor concerning the tax risks associated with accepting an option to purchase the Company’s Common Stock. [The term of the Option shall be 10 years], subject to earlier expiration in the event of the termination of your services to the Company. [The Option shall be immediately exercisable, but the purchased shares shall be subject to repurchase by the Company at the exercise price in the event that your services to the Company terminate before the purchased shares become vested.] So long as your service status is continuous, the Option shall vest [and become exercisable] as follows: [# of option shares] of the total number of option shares shall vest [and become exercisable] on [Option Exerciseable Date] and 1/48th of the total Option shares shall vest [and become exercisable] in equal monthly installments thereafter. The Option will be an incentive stock option to the maximum extent allowed by the tax code and shall be subject to the other terms and conditions set forth in the Company’s [Stock Plan Name] (the “Stock Plan”) and in the Company's standard form of Stock Option Agreement (the “Stock Agreement”).]
- [Acceleration Benefit. [Acceleration if Not Assumed: If there is a Corporate Transaction that constitutes a Triggering Event and any outstanding Option held by you during your continuing service to the Company is to be terminated (in whole or in part) pursuant to the Stock Plan, the vesting and exercisability of each such Option shall accelerate such that the Option shall become vested and exercisable in full prior to the consummation of the Triggering Event at such time and on such conditions as the Administrator shall determine. The Administrator shall notify you that the Option will terminate at least five (5) days prior to the date on which the Option terminates. In order to be eligible for such acceleration of vesting benefit, you must execute the Company’s standard form of release of all claims agreement. For purposes of this paragraph, unless a capitalized term used in this paragraph has a meaning given to it elsewhere in this Agreement, such term shall have the meaning given to it in the Stock Plan or Stock Agreement.] OR [Single Trigger Acceleration: If there is a Corporate Transaction that constitutes a Triggering Event and irrespective of whether outstanding Options are being assumed, substituted, exchanged or terminated in connection with the transaction, the vesting and, if applicable, exercisability of each outstanding Award, Optioned Stock or Restricted Stock held by you during your continuing service to the Company shall accelerate such that the Options shall become vested and exercisable to the extent of ___% of the Shares then unvested, and any repurchase right of the Company applicable to Optioned Stock, Restricted Stock or shares issued upon exercise of an Award shall lapse as to ___% of the Shares subject to such repurchase right, in each case effective as of immediately prior to consummation of the Triggering Event. In order to be eligible for such acceleration of vesting benefit, you must execute the Company’s standard form of release of all claims agreement. For purposes of this paragraph, unless a capitalized term used in this paragraph has a meaning given to it elsewhere in this Agreement, such term shall have the meaning given to it in the Stock Plan. ] OR [Double Trigger Acceleration: If you are Involuntarily Terminated by the Successor Corporation in connection with or within __ month(s) following the consummation of a Corporate Transaction that constitutes a Triggering Event, then any Award, Optioned Stock or Restricted Stock assumed or substituted by the Successor Corporation that is held by you at the time of your service termination shall accelerate and, if applicable, become exercisable such that the Options shall become vested and exercisable as to the number of Shares that would otherwise have vested and been exercisable as of the date __ month(s) from the date of termination, and any repurchase right of the Company to which the Successor Corporation has succeeded as a result of the Triggering Event applicable Optioned Stock, Restricted Stock or shares issued upon exercise of an Award shall lapse as to the number of Shares as to which the repurchase right would otherwise have lapsed as of the date __ month(s) from the date of termination, in each case assuming you would have remained in Continuous Service Status for such __-month period. The acceleration of vesting and lapse of repurchase rights provided for in the previous sentence shall occur immediately prior to the effective date of termination of your Continuous Service Status. In order to be eligible for such acceleration of vesting benefit, you must execute the Company’s standard form of release of all claims agreement. For purposes of this paragraph, unless a capitalized term used in this paragraph has a meaning given to it elsewhere in this Agreement, such term shall have the meaning given to it in the Stock Plan.]
- Vacation/PTO and Employee Benefits. During your Employment, you shall be eligible to accrue up to 15 days of paid vacation / paid time off, pro-rated for the remainder of this calendar year, in accordance with the Company’s vacation / paid time off policy, as it may be amended from time to time. During your Employment, you shall be eligible to participate in the employee benefit plans maintained by the Company and generally available to similarly situated employees of the Company, subject in each case to the generally applicable terms and conditions of the plan in question and to the determinations of any person or committee administering such plan.
- Business Expenses. The Company will reimburse you for your necessary and reasonable business expenses incurred in connection with your duties hereunder upon presentation of an itemized account and appropriate supporting documentation, all in accordance with the Company’s generally applicable policies.
- Employment at Will. Your Employment shall be “at will,” meaning that either you or the Company shall be entitled to terminate your Employment at any time and for any reason, with or without Cause. Any contrary representations that may have been made to you shall be superseded by this Agreement. This Agreement shall constitute the full and complete agreement between you and the Company on the “at-will” nature of your Employment, which may only be changed in an express written agreement signed by you and a duly authorized officer of the Company.
- Rights Upon Termination. Except as expressly provided in Section 6, upon the termination of your Employment, you shall only be entitled to the compensation and benefits earned and the reimbursements described in this Agreement for the period preceding the effective date of the termination.
- Termination Benefits.
- General Release. Any other provision of this Agreement notwithstanding, subsections (b) and (c) below shall not apply unless and until (i) you have executed (and do not revoke) a full and complete general release of all claims in a form provided by the Company without alteration and (ii) you have returned all Company property.
- Severance Pay. If, during the term of this Agreement, the Company terminates your Employment for any reason other than Cause, death or Permanent Disability, then, in addition to the amounts payable in accordance with Section 5(b), the Company shall pay you severance pay at a rate equal to your Base Salary in effect at the time of termination of your Employment for a period of 3 month(s) following the termination of your Employment (the “Continuation Period”). Such severance pay shall be paid in accordance with the Company’s standard payroll procedures on the Company’s payroll dates and shall be subject to all applicable withholdings. Notwithstanding anything stated herein to the contrary, the severance provided in connection with your termination under this section is intended to be exempt from Code Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9)(iii); provided that, to the extent that such severance and any other payments paid to you in connection with your involuntary separation from service does not qualify or otherwise exceeds the limit set forth in Treasury Regulation Section 1.409A-1(b)(9)(iii)(A) or any similar limit promulgated by Treasury or the IRS, the portion of the severance that does not qualify or otherwise exceeds such limit, as determined by the Company in its sole discretion, shall be paid by no later than the fifteenth (15th) day of the third (3rd) month following the end of your first tax year in which your termination date occurs, or, if later, the fifteenth (15th) day of the third (3rd) month following the end of the Company's first tax year in which your termination date occurs, as provided in Treasury Regulation Section 1.409A-1(b)(4).
- Health Insurance. If subsection 6(b) above applies, and if you elect to continue and pay your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following the termination of your Employment, then the Company shall pay your monthly premium under COBRA until the earliest of (i) the end of the Continuation Period, (ii) the expiration of your continuation coverage under COBRA or (iii) the date when you receive substantially equivalent health insurance coverage in connection with new employment or self-employment.
- Definition of “Cause.” For all purposes under this Agreement, “Cause” shall mean:
- any [material] breach by you of this Agreement, the Confidential Information and Invention Assignment Agreement between you and the Company[, or any other written agreement between you and the Company, if such breach causes material harm to the Company ;]
- any [material] failure by you to comply with the Company’s written policies or rules, as they may be in effect from time to time during your Employment[, if such failure causes material harm to the Company ;]
- your repeated failure to follow reasonable and lawful instructions from the Company or the Chief Executive Officer of the Company and your failure to cure such condition after receiving 20 days advance written notice;
- commission, conviction of, or a plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State by you [if such felony is work-related, materially impairs your ability to perform services for the Company, or results in a material loss to the Company or material damage to the reputation of the Company ;]
- your misappropriation of funds or property of the Company;
- neglect of your duties; or
- any gross or willful misconduct by you [resulting in a material loss to the Company or material damage to the reputation of the Company.]
- Definition of “Permanent Disability.” For all purposes under this Agreement, “Permanent Disability” shall mean your inability to perform the essential functions of your position with or without reasonable accommodation for a period of 90 consecutive days because of your physical or mental impairment.
- Pre-Employment Conditions.
- Confidentiality Agreement. Your acceptance of this offer and commencement of employment with the Company is contingent upon the execution, and delivery to an officer of the Company, of the Company’s Confidential Information and Invention Assignment Agreement, a copy of which is enclosed for your review and execution (the “Confidentiality Agreement”), prior to or on your Start Date.
- Right to Work. For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided to us within three (3) business days of your Start Date, or our employment relationship with you may be terminated.
- [Verification of Information. This offer of employment is also contingent upon the successful verification of the information you provided to the Company during your application process, as well as a general background check performed by the Company to confirm your suitability for employment. By accepting this offer of employment, you warrant that all information provided by you is true and correct to the best of your knowledge, you agree to execute any and all documentation necessary for the Company to conduct a background check and you expressly release the Company from any claim or cause of action arising out of the Company’s verification of such information.]
- Company’s Successors. This Agreement shall be binding upon any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets. For all purposes under this Agreement, the term “Company” shall include any successor to the Company’s business or assets that becomes bound by this Agreement.
- Your Successors. This Agreement and all of your rights hereunder shall inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
- Miscellaneous Provisions.
- [Indemnification. The Company shall indemnify you to the maximum extent permitted by applicable law and the Company’s Bylaws with respect to your service and you shall also be covered under a directors and officers liability insurance policy paid for by the Company to the extent that the Company maintains such a liability insurance policy now or in the future.]
- [Legal Fees. The Company shall promptly pay all reasonable costs and expenses (including fees and disbursements of counsel) up to $[$ Legal Max] incurred by you in negotiating the terms and conditions of this Agreement.]
- Notice. Notices and all other communications contemplated by this Agreement shall be in writing and shall 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 your case, mailed notices shall be addressed to you at the home address that you most recently communicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters, and all notices shall be directed to the attention of its Secretary.
- Modifications and Waivers. No provision of this Agreement shall be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by you and by an authorized officer of the Company (other than you). No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time.
- Whole Agreement. [This Agreement supersedes the offer letter dated [Offer Letter Date].] No other agreements, representations or understandings (whether oral or written and whether express or implied) which are not expressly set forth in this Agreement have been made or entered into by either party with respect to the subject matter hereof. This Agreement and the Confidentiality Agreement contain the entire understanding of the parties with respect to the subject matter hereof.
- Withholding Taxes. All payments made under this Agreement shall be subject to reduction to reflect taxes or other charges required to be withheld by law.
- Choice of Law and Severability. This Agreement shall be interpreted in accordance with the laws of the State of California without giving effect to provisions governing the choice of law. If any provision of this Agreement becomes or is deemed invalid, illegal or unenforceable in any applicable jurisdiction by reason of the scope, extent or duration of its coverage, then such provision shall be deemed amended to the minimum extent necessary to conform to applicable law so as to be valid and enforceable or, if such provision cannot be so amended without materially altering the intention of the parties, then such provision shall be stricken and the remainder of this Agreement shall continue in full force and effect. If any provision of this Agreement is rendered illegal by any present or future statute, law, ordinance or regulation (collectively, the “Law”) then that provision shall be curtailed or limited only to the minimum extent necessary to bring the provision into compliance with the Law. All the other terms and provisions of this Agreement shall continue in full force and effect without impairment or limitation.
- No Assignment. This Agreement and all of your rights and obligations hereunder are personal to you and may not be transferred or assigned by you at any time. The Company may assign its rights under this Agreement to any entity that assumes the Company’s obligations hereunder in connection with any sale or transfer of all or a substantial portion of the Company’s assets to such entity.
- Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
We are all delighted to be able to extend you this offer and look forward to working with you. To indicate your acceptance of the Company’s offer, please sign and date this letter in the space provided below and return it to me, along with a signed and dated original copy of the Confidentiality Agreement, on or before [Return Date]. The Company requests that you begin work in this new position on or before [Absolute Start Date]. Please indicate the date (either on or before the aforementioned date) on which you expect to begin work in the space provided below (the “Start Date”).
Very truly yours,
Name: [Company Contact Name]
Title: [Company Contact Title]
ACCEPTED AND AGREED:
Anticipated Start Date: [Anticipated Start Date]
Attachment A: Confidential Information and Invention Assignment Agreement
CONFIDENTIAL INFORMATION AND
INVENTION ASSIGNMENT AGREEMENT