Classmates.com 2003 Annual Report Download - page 85

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 . Employee shall be eligible to participate, as of the date of Employee's employment, 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.
4. Termination .
4.1 Termination for Cause .
(a) Termination "for cause" is defined as follows: the Company terminates Employee's employment with the Company
(1) if Employee is convicted of a felony, including any act of moral turpitude, which adversely impacts the Company, or (2) if
Employee fails, after receipt of detailed written notice and after receiving a period of at least thirty (30) days following such
notice to cure such failure, to use his reasonable good faith efforts to follow the direction of the Company's Board of Directors
and to perform his obligations hereunder.
(b) The Company may terminate this Agreement for any of the reasons stated in Section 4.1(a) by giving written notice to
Employee without prejudice to any other remedy to which the Company may be entitled. The notice of termination shall specify
the grounds for termination. If Employee's employment hereunder is terminated "for cause" pursuant to this Section 4.1,
Employee shall be entitled to receive hereunder his accrued but unpaid Base Salary and vacation pay through the date of
termination, and reimbursement for any expenses
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as set forth in Section 3.6, through the date of termination, but shall not be entitled to receive any unpaid portion of the Annual
Bonus or any other amount.
4.2 Termination Without Cause . If Employee's employment is terminated without "cause" as defined in Section 4.1(a), or if
Employee is Involuntarily Terminated (as defined below), the Company (or its successor, as the case may be) shall pay to
Employee (i) any accrued but unpaid Base Salary and vacation through the date of termination, (ii) reimbursement for any
expenses as set forth in Section 3.6, through the date of termination, (iii) Employee's Annual Bonus, prorated through the date of
termination, and (iv) a severance payment in an amount equal to three times Employee's Base Salary and Annual Bonus, payable
in one lump sum on the date of termination, subject to withholding as may be required by law. For the purposes of Section 4.2
(iii) above and Section 4.2(iv)(A) above, Annual Bonus shall mean the greater of 75% of Employee's then current Base Salary
or the Annual Bonus paid to Employee for the preceding fiscal year in the event of Involuntary Termination, or 75% of
Employee's then current Base Salary in the case of termination without cause. In addition, if Employee's employment is
terminated without cause (other than if Employee is Involuntarily Terminated), Employee will be credited with an additional
twelve (12) months of service toward vesting in all stock options then held by Employee (the "Option Shares") in addition to the
service he has accrued toward vesting through the date of termination, and the Repurchase Option will lapse with respect to a
number of Restricted Shares equal to (x) the sum of the number of full months that have elapsed between the Grant Date and the
date of termination, plus twelve (12) additional months, divided by (y) 48 months, multiplied by (z) the total number of
Restricted Shares (for purposes of illustration, if Employee's employment is terminated without cause on January 27, 2005, the
Repurchase Option will lapse with respect to 50,000 Restricted Shares).If Employee's employment is terminated due to death or
permanent disability, vesting of all Option Shares will be accelerated in full and the Repurchase Option will lapse with respect
to all Restricted Shares. If Employee is Involuntarily Terminated, vesting of all Option Shares will be accelerated in full and all
such options shall remain in effect for a one (1) year period following the date of termination, and the Repurchase Option will
lapse with respect to all Restricted Shares.
As used in this Section 4.2, Employee shall be deemed terminated without cause if Employee resigns following a breach by the
Company of its obligations hereunder; provided, however, in the event of an unintentional breach by the Company, Employee
shall provide the Company with written notice of such breach and the Company shall have fifteen days following such notice to