Classmates.com 2003 Annual Report Download - page 72

1.1
The Company hereby agrees to employ Employee, and Employee hereby accepts such employment, on the terms and conditions
set forth herein, commencing the date hereof and continuing through February 9, 2008 (the "Term"), unless terminated earlier as
provided in Section 4 below. Employee's place of employment shall be the in the greater Los Angeles metropolitan area.
2. Duties of Employee .
2.1 Employee shall serve as the Chief Executive Officer and Chairman of the Company. In this capacity, Employee shall perform
such customary, appropriate and reasonable executive duties as are usually performed by the Chief Executive Officer and
Chairman, including such duties as are delegated to him from time to time by the Board of Directors of the Company or a
committee thereof (the "Board"). Employee shall report directly to the Company's Board.
2.2 Employee agrees to devote Employee's good faith, full time, attention, skill and efforts to the performance of his duties for the
Company during the Term; provided, however, that the Company acknowledges that Employee has certain responsibilities to
and involvement with other entities and agrees to allow Employee to continue his involvement with such entities without in
anyway jeopardizing his employment with the Company. This Agreement shall not be interpreted to prohibit Employee from
making passive personal investments or engaging in charitable and public service activities if those activities do not materially
interfere with the services required under this Agreement.
3. Compensation and Other Benefits .
3.1 Base Salary . During the Term, the Company shall pay to Employee a base salary per fiscal year equal to Employee's current
base salary (the "Base Salary"), with payments to be made in accordance with the Company's standard payment policy and
subject to such withholding as may be required by law. Employee's Base Salary shall be increased to include any increases in
Employee's base salary as approved by the Board.
3.2 Bonus . During the Term, the Employee shall also be eligible to receive an annual cash bonus of up to 125% of Employee's base
salary for each fiscal year (the "Annual Bonus"), less
1
withholding required by law, based on performance criteria established by the Board. Employee's Annual Bonus shall be
increased to include any increases in Employee's Annual Bonus as approved by the Board. Employee shall not be eligible to
receive any unpaid Annual Bonus if his employment hereunder is terminated pursuant to either Section 4.1 or if Employee
voluntarily resigns.
3.3 Restricted Stock Grant . Employee shall be entitled to purchase 250,000 shares of the Company's common stock, par value
$0.0001 per share (the "Restricted Shares") at par value for an aggregate cash purchase price of Twenty-Five Dollars ($25.00).
Except as otherwise provided in Section 4.3, in the event of a termination of Employee's employment before all Restricted
Shares are released from the Company's Repurchase Option (as defined below), the Company shall have the option to
repurchase all or any portion of the Restricted Shares at such time at the original cash purchase price per share (the "Repurchase
Option"). The Company shall hold the Restricted Shares in escrow until the Company exercises its Repurchase Option or the
Restricted Shares are released from the Repurchase Option. All of the Restricted Shares shall be released from the Repurchase
Option (such released shares, the "Released Shares") on January 27, 2008. Upon the release of the Restricted Shares from the
Repurchase Option, the Company shall deliver to Employee a stock certificate representing such Released Shares, less a number
of Released Shares (calculated based on the fair market value thereof as of such date) equal to the minimum amount of
withholding as may be required by law. The terms and conditions of the Restricted Shares purchase and the Repurchase Option
shall be set forth in greater detail in a restricted stock purchase agreement (mutually satisfactory in form and substance) to be
entered into by the Company and Employee, dated effective as of January 27, 2004 (the "Grant Date").
3.4 Vacation . Employee shall be entitled to five (5) weeks paid vacation per year in accordance with the Company's vacation
policies.
3.5 Other Benefits . During the Term, Employee shall be entitled to participate in all group life, health, medical, dental or disability
insurance or other employee, health and welfare benefits made available generally to other executives of the Company. If
Employee elects to participate in any of such plans, Employee's portion of the premium(s) will be deducted from Employee's
paycheck.
3.6 Business Expenses . The Company shall promptly reimburse Employee for all reasonable and necessary business expenses
incurred by Employee in connection with the business of the Company and the performance of his duties under this Agreement,
subject to Employee providing the Company with reasonable documentation thereof.
3.7 Board of Directors . Employee shall be Chairman of the Company and also a member of the Company's Board of Directors.
Employee's appointments as Chairman and as a member of the Board will automatically terminate upon the termination of
Employee's employment with the Company for any reason.