Rosetta Stone 2014 Annual Report Download - page 156

increased (but not decreased) from time to time during the Service Term by the Board based upon the Company’s and Executive’s
performance.
(b) Bonus Plan. Executive shall be eligible to receive a bonus in accordance with Company bonus policy to be
established by the Board from time to time. The bonus, if any, will be determined by the Board based upon the Company’s
achievement of financial performance goals and other objectives, as determined by the Board in good faith for each fiscal year of the
Company. The Company will pay Executive the bonus, if any, in accordance with the terms of the then-current Company bonus
policy. As of the Executive’s hire date, the Executive will be able to participate in the annual bonus plan (the “Annual Bonus”) and be
eligible to receive an Annual Bonus target of sixty percent (60%) of his Annual Base Salary upon one hundred percent (100%)
achievement of annual objectives, prorated for the length of participation in 2014. For subsequent years, the Annual Bonus target as a
percentage of then-current Annual Base Salary, may be adjusted, but may not be less than sixty percent (60%) of the Executive’s then-
current Annual Base Salary.
(c) Equity. The Executive will receive an initial new hire equity grant, with a total value of $250,000, consisting of 60%
of the value in stock options, vesting over four (4) years; and a restricted stock award grant representing 40% of the value, vesting over
four (4) years, on the date of grant subject to the terms of the 2009 Rosetta Stone Inc. Omnibus Incentive Plan, as amended, and the
applicable form of award agreement. Executive shall be eligible to receive annual grants of stock options and other equity awards in
accordance with equity compensation arrangements established by the Board. The grants shall have such terms as are determined by
the Board in accordance with the current stock plan in place at time of grant.
(d) Benefits.
(i) Executive and, to the extent eligible, his dependents, shall be entitled to participate in and receive all benefits
under any welfare or pension benefit plans and programs made available to the Company’s senior level executives or to
its employees generally (including, without limitation, medical, disability and life insurance programs, accidental death
and dismemberment protection, leave and participation in retirement plans and deferred compensation plans), subject,
however, to the generally applicable eligibility, participation, and other provisions of the various plans and programs
and laws and regulations in effect from time to time.
(ii) The Company shall reimburse Executive for all reasonable, ordinary and necessary business, travel or
entertainment expenses incurred during the Service Term in the performance of his services hereunder in accordance
with the policies of the Company as they are from time to time in effect. Executive, as a condition precedent to
obtaining such payment or reimbursement, shall provide to the Company any and all statements, bills or receipts
evidencing the travel or out-of-pocket expenses for which Executive seeks payment or reimbursement, and any other
information or materials, which the Company may from time to time reasonably require. The Company shall reimburse
Executive the amount of such an expense in accordance with the Company’s expense reimbursement policy as in effect
from time to time, subject to Section 15.
(iii) Executive shall be allotted twenty-two (22) paid vacation days per annum which shall be provided pro rata
during the applicable year and seven (7) paid sick days and shall be entitled to medical, disability, family and other
leave in accordance with Company policies as in effect from time to time for senior executives. Paid vacation and sick
days not used by