Sample Business Contracts

Employment Agreement - inc. and Robert S. Sherman

Employment Forms

  • Employment Agreement. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
  • Consulting Agreement. Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Commission Agreement. Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
  • More Employment Agreements

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                                BUSYBOX.COM, INC.

                              EMPLOYMENT AGREEMENT

This employment agreement ("Agreement") is entered into as of the date specified
on the signature page ("Effective Date") by and between, inc., a
Delaware corporation located at 701 Battery Street, 3rd Floor, San Francisco,
California 94111 ("Company") and the individual specified on the signature page


R1.  The parties desire to memorialize the employment relationship of Employee
     with the Company.

R2.  The Board of Directors of the Company has approved and authorized the entry
     into this Agreement with Employee.

R3.  The parties hereby enter into this Agreement setting forth the terms and
     conditions for the employment relationship of Employee with the Company.

                               TERMS & CONDITIONS

1.   EMPLOYMENT: From the Effective Date through the term of this Agreement,
     Employee is employed as President of the Company and of any subsidiary or
     other affiliate that it may acquire. Employee shall render executive,
     policy and other management services to the Company and
     subsidiaries/affiliates of the type customarily performed by persons
     serving in similar executive officer capacities. Employee shall devote
     substantially all of his working time and his best efforts to the Company
     and his position, which shall include such duties as the company's Board of
     Directors may from time to time reasonably direct that are reasonably
     consistent with Employee's education, experience and background. During the
     term of this Agreement, there shall be no material increase or decrease in
     the duties and responsibilities of Employee otherwise than as provided
     herein, unless the parties otherwise agree in writing.


2.1  SALARY: The Company agrees to pay Employee from the Effective Date at an
     annual rate equal to ONE HUNDRED SEVENTY FIVE THOUSAND dollars ($175,000)
     ("Salary"), with such subsequent increases in Salary during the term of the
     Agreement as may be determined by the Compensation Committee of the Board;
     provided, however, that during the first three years following the
     effective date of the registration statement with respect to the initial
     public offering of the Company's stock, Employee's Salary hereunder shall
     not exceed ONE HUNDRED SEVENTY FIVE THOUSAND dollars ($175,000) per annum
     without the approval of the Compensation Committee. In determining Salary
     increases, the Compensation Committee may compensate Employee for increases
     in the cost of living and may also provide for performance or merit
     increases. The Salary of Employee shall not be decreased at any time during
     the term of this Agreement from the amount then in effect, unless Employee


     otherwise agrees in writing. Participation in deferred compensation, bonus,
     discretionary bonus, retirement and other employee benefit plans shall not
     reduce the Salary payable to Employee under this Section 2.1. The Salary
     under this Section 2.1 shall be payable to Employee not less frequently
     than monthly. Employee shall not be entitled to receive fees for serving as
     a director of the Company or of any subsidiary or affiliate of the Company
     or for serving as a member of any committee of any such board of directors.

2.2  ANNUAL BONUS: In addition to the Salary under Section 2.1 above, the
     Company shall pay to Employee an annual bonus of FIFTY PERCENT (50%) of the
     Salary under such Subsection. The annual bonus shall be payable in January
     following each calendar year during the term of this Agreement and shall be
     prorated for any partial years.

     Agreement, Employee shall be entitled to participate in an equitable manner
     with all other executive employees of the Company in such discretionary
     bonuses as may be authorized, declared and paid by the Compensation
     Committee to its executive employees. The Company will adopt an incentive
     bonus plan providing for the payment of annual performance incentive
     bonuses to Employee and other executive officers based upon the increase in
     the Company's operating profit or other appropriate performance objectives.
     The incentive bonus arrangement will provide Employee with an opportunity
     to earn additional incentive compensation in an amount up to THREE PERCENT
     (3%) of the annual increase in the Company's net income before taxes as
     reported in the Company's audited annual financial statement. No other
     compensation provided for in this Agreement shall be deemed a substitute
     for Employee's right to participate in such bonuses.


4.1  OTHER BENEFITS AND PREREQUISITES: Employee shall be entitled to participate
     in any plan of the Company relating to stock options, restricted stock,
     employee stock purchase or ownership, pension, thrift, profit sharing,
     group life insurance, medical coverage, education or other retirement or
     employee benefit plans or arrangements that the Company has adopted or may
     adopt for the benefit of its employees or executive officers. Employee
     shall also be entitled to participate in, or enjoy the benefit of, any
     other fringe benefits or prerequisites that are now or may be or become
     applicable to the Company's executive employees.

4.2  BUSINESS EXPENSES: During the term of Employee's employment by the Company,
     the Company shall promptly reimburse Employee for all reasonable and
     customary expenses incurred by Employee in performing services for the
     Company, including all living and travel expenses while away from home on
     business or at the request of and in the service of the Company, provided
     that such expenses are incurred and accounted for in accordance with the
     policies and procedures established by the Company. Employee shall be
     entitled to first or business class for all business air travel. Employee
     shall be entitled to parking expenses, excluding violations, when on the
     job, be it at the office or while on business trips. Employee shall be
     entitled to a reasonable per diem for living expenses while in San


4.3  DIRECTOR & OFFICER INSURANCE: At all times during the term of this
     Agreement the Company shall maintain in full force and effect a director
     and officer insurance policy with a national insurance underwriter insuring
     Employee for his acts and omissions in his capacity as an Officer and
     Director of the Company, with coverage under such policy of not less than
     ONE MILLION dollars ($1,000,000).

5.   TERM: The initial term of employment under this Agreement shall begin on or
     before November 1, 1999, and continue until December 31, 2001. This
     Agreement shall be automatically renewed for an subsequent three-year term,
     unless either Employee or the Company gives contrary written notice to the
     other party hereto not less than 180 days before the scheduled expiration
     of the initial term of this Agreement. Each term and all such renewal terms
     are collectively referred to herein as the term of this Agreement.

6.   VOLUNTARY ABSENCES; VACATIONS: Employee shall be entitled, without loss of
     pay, to be absent voluntarily for reasonable periods of time from the
     performance of the duties and responsibilities under this Agreement. All
     such voluntary absences shall count as paid vacation time, unless the Board
     otherwise approves. Employee shall be entitled to an annual paid vacation
     of at least six (6) weeks per year or such longer period as the Board may
     approve. The timing of paid vacations shall be scheduled in a reasonable
     manner by Employee.

7.   TERMINATION OF EMPLOYMENT: Employee's employment may be terminated without
     any breach of this Agreement only under the following circumstances:

7.1  DEATH: Employee's employment shall terminate upon his death.

7.2  DISABILITY: The Company may terminate Employee's employment because of
     disability. For this purpose, "disability" shall mean the inability of
     Employee to perform his duties under this Agreement because of physical or
     mental illness or incapacity for a continuous period of six months during
     which Employee shall have been absent from his duties under this Agreement
     on a substantially full-time basis.

7.3  CAUSE: The Company may terminate Employee's employment for cause. For
     purposes of this Agreement, the Company shall have "cause" to terminate
     Employee's employment only in the event of (a) the willful and continued
     failure by Employee to substantially perform his duties hereunder (other
     than any such failure resulting from Employee's inability to perform such
     duties as a result of physical or mental illness or incapacity or any such
     actual or anticipated failure after the delivery of a Notice of
     Termination, as defined in Section 7.5, by Employee for Good Reason, as
     defined in Section 7.4.2) after delivery to Employee of a written demand
     for substantial performance that specifically identifies the manner in
     which the Company believes that Employee has not substantially performed
     his duties and a reasonable opportunity to cure; (b) willful misconduct by
     Employee that causes substantial and material injury to the business and
     operations of the Company, the continuation of which, in the reasonable
     judgment of the Board, will continue to substantially and materially injure
     the business and operations of the Company in the future; or (c)


     conviction of Employee of a felony. No act or failure to act shall be
     considered "willful" for this purpose unless done, or omitted to be done,
     by Employee other than in good faith and other than with a reasonable
     belief that his action or omission was in the best interests of the
     Company. Employee shall not be deemed to have been terminated for cause
     unless Employee shall have been provided with (i) a reasonable notice
     setting forth the reasons that the Company believes constitute cause for
     the termination of his employment; (ii) a Notice of Termination as defined
     in Section 7.5 from the Board finding that, in the reasonable good faith
     opinion of the Board, cause for the termination exists and specifying the
     particulars thereof in reasonable detail.

7.4  TERMINATION BY EMPLOYEE: Employee may terminate his employment (a) for good
     reason by giving ten days prior written notice to the Company or (b) at any
     time by giving 120 days prior written notice to the Company.

     7.4.1     GOOD REASON: For purposes of this Section, "good reason" shall
               mean (a) the assignment to Employee of any duties inconsistent
               with Employee's status or any substantial adverse alteration in
               the nature or status of Employee's responsibilities; (b) any
               change in Employee's reporting responsibility such that Employee
               is required to report other than exclusively to the Chief
               Executive Officer, (c) any purported termination of Employee's
               employment by the Company that is not effected pursuant to a
               Notice of Termination satisfying the requirements of Section 7.5
               hereof; (d) any other failure by the Company to comply with any
               material provision of this Agreement which failure continues for
               more than ten days after written notice of such noncompliance
               from Employee; or (e) any notices given by the Company to
               Employee under Section 5 hereof that this Agreement will not be
               renewed on any anniversary date.

7.5  NOTICE OF TERMINATION: Any termination of Employee's employment by the
     Company or by Employee (other than termination pursuant to Section 7.1 or
     7.2 hereof) shall be communicated by the terminating party to the other
     party by a written Notice of Termination. Any Notice of Termination given
     by a party shall specify the particular termination provision of this
     Agreement relied upon by such party and shall set forth in reasonable
     detail the facts and circumstances relied upon as providing a basis for the
     termination under the provision so specified.

7.6  TERMINATION DATE: The termination date shall mean (a) if Employee's
     employment is terminated by his death, the date of his death; (b) if
     Employee's employment is terminated pursuant to Section 7.2 hereof, the
     date specified in the Notice of Termination, which shall be after the
     expiration of the six-month period specified in that Subsection; (c) if
     Employee's employment is terminated by the Company for cause, the date
     specified in the Notice of Termination; or (d) if Employee's employment is
     terminated for any other reason, sixty days following the date on which the
     Notice of Termination is given.


     Employee's employment is terminated because of his death, by the


     Company for cause, or by Employee other than for good reason, the Company
     shall pay Employee his salary and a pro rata portion of the bonus specified
     in Section 2(b) (based upon the bonus paid in respect of the preceding
     year) through the Termination Date and the Company shall have no further
     obligation to Employee hereunder.

8.2  TERMINATION BECAUSE OF DISABILITY: If Employee's employment is terminated
     by the Company because of disability under Section 7.2 hereof, the Company
     shall pay Employee an annual disability benefit equal to the excess of (a)
     sixty percent of his Salary at the rate in effect under Section 2.1 hereof
     (based upon the bonus paid in respect of the preceding year) over (b) the
     amount of the long term disability benefit that is payable to Employee
     under any policy of disability insurance provided for Employee by the
     Company at its expense. The disability benefit shall be paid for such
     period as is determined by the Board of Directors for the Company's senior
     executives but shall not be less than the remainder of the scheduled term
     of employment.

     Agreement, the Company shall terminate Employee's employment other than for
     cause or because of disability or (b) Employee shall terminate his
     employment for Good Reason; then:

     8.3.1     The Company shall pay Employee his salary and a pro rata portion
               of the bonus specified in Section 2.1 hereof (based upon the
               bonus paid in respect of the preceding year) through the
               Termination Date and all other unpaid and pro rata amounts to
               which Employee is entitled as of the Termination Date under any
               compensation plan or program of the Company, including, without
               limitation, any incentive performance bonus and all accrued
               vacation time;

     8.3.2     The Company shall pay as liquidated damages to Employee, and in
               lieu of any further salary payments hereunder for periods after
               the Termination Date, Employee's then current Salary (payable in
               installments in accordance with the Company's normal payroll
               practices) for the remainder of the scheduled term of employment
               and the product of (a) the sum of (i) Employee's annual bonus
               specified in Section 2.1 hereof (based upon the bonus paid in
               respect of the preceding year) and (ii) the maximum annual bonus
               amount that could have been paid to Employee under the Company's
               performance incentive bonus plan for the year in which the
               Termination Date occurs, and (b) the number of years (and any
               fraction of a year) remaining in the term of this Agreement under
               Section 5 hereof as of the Termination Date, which amount shall
               be payable in equal monthly installments during the remainder of
               the scheduled term of employment;

     8.3.3     In addition to the liquidated amounts that are payable to
               Employee, the following shall apply: (a) Employee shall continue
               to participate in, and accrue benefits under, all retirement,
               pension, profit sharing, employee stock ownership, thrift and
               other deferred compensation plans of the Company for the
               remaining term of this Agreement as if the termination of
               employment of Employee had not occurred (with Employee being
               deemed to receive annually for the purposes of such plans
               Employee's then current Salary and


               bonus (at the time of his termination) under Sections 2.1 and 2.2
               of this Agreement), except to the extent that such continued
               participation and accrual is expressly prohibited by law, or to
               the extent such plan constitutes a "qualified plan" under Section
               401 of the Internal Revenue Code of 1986, as amended ("Code"), by
               the terms of the Plan, in which case the Company shall provide
               Employee a substantially equivalent, unfunded, non-qualified
               benefit; (b) Employee shall be entitled to continue to receive
               all other employee benefits and then existing fringe benefits
               referred to in Sections 4.1 and 4.2 hereof for the remaining term
               of this Agreement as if the termination of employment had not
               occurred; and (c) all insurance or other provisions for
               indemnification, defense or hold-harmless of officers and
               directors of the Company that are in effect on the date the
               Notice of Termination is sent to Employee shall continue for the
               benefit of Employee with respect to all of his acts and omissions
               while an officer or director as fully and completely as if such
               termination had not occurred, and until the final expiration or
               running of all periods of limitation against action which may be
               applicable to such acts or omissions; and,

     8.3.4     The liquidated amount and other benefits provided for in this
               Section 8.3 shall not be reduced by any compensation or benefits
               that Employee may receive for other employment with another
               employer or through self-employment after termination of
               employment with the Company.

8.4  COST OF ENFORCEMENT: In the event the employment of Employee is terminated
     by the Company because of disability of without cause, or by Employee for
     good reason, and the Company fails to make timely payment of the amounts
     owed to Employee under this Agreement, Employee shall be entitled to
     reimbursement for all reasonable costs, including attorney's fees, incurred
     in Employee taking action to collect such amounts or otherwise to enforce
     this Agreement, plus interest on such amounts at the rate of one percent
     above prime rate (defined as the base rate on corporate loans at large US
     money center commercial banks as published by The Wall Street Journal),
     compounded monthly, for the period from the date of employment termination
     until payment is made to Employee. Such reimbursement and interest shall be
     in addition to all rights to which Employee is otherwise entitled under
     this Agreement.

8.5  PARACHUTE PAYMENT LIMITATION: If any payment or benefit to Employee under
     this Agreement would be considered a "parachute payment" within the meaning
     of Section 280(g)(b)(2) of the Code and if, after reduction for any
     applicable federal excise tax imposed by Section 4999 of the Code ("Excise
     Tax") and federal income tax imposed by the Code, Employee's net proceeds
     of the amounts payable and the benefits provided under this Agreement would
     be less than the amount of Employee's net proceeds resulting from the
     payment of the Reduced Amount described below, after reduction for federal
     income taxes, then the amount payable and the benefits provided under this
     Agreement shall be the largest amount that could be received by Employee
     under this Agreement such that no amount paid to Employee under this
     Agreement and any other agreement, contract or understanding heretofore or
     hereafter entered into between Employee and the Company ("Other


     and any formal or informal plan or other arrangement heretofore or
     hereafter adopted by the Company for the direct or indirect provision of
     compensation to Employee (including groups or classes or participants or
     beneficiaries of which Employee is a member), whether or not such
     compensation is deferred, is in cash, or is in the form of a benefit to or
     for Employee ("Benefit Plan") would be subject to the Excise Tax. In the
     event that the amount payable to Employee shall be limited to the Reduced
     Amount, then Employee shall have the right, in Employee's sole discretion,
     to designate those payments or benefits under this Agreement, any Other
     Agreements, and/or Benefit Plan, that should be reduced or eliminated so as
     to avoid having the payment to Employee under this Agreement be subject to
     the Excise Tax.

9.   CONFIDENTIALITY: In consideration of the willingness of the Company to
     employ Employee and the compensation to be paid and benefits to be received
     therefor, and for other good and valuable consideration, the receipt and
     adequacy of which is hereby acknowledged, Employee agrees as follows:

9.1  THE COMPANY OWNS ALL OF EMPLOYEE'S WORK: All improvements, discoveries,
     inventions, designs, documents, licenses and patents, software programs, or
     other data devised, conceived, made, developed, obtained, filed, perfected,
     acquired, or first reduced to practice, in whole or in part, by Employee
     during the term of this Agreement, and related in any way to the business,
     including research and development, of the Company or any subsidiary of
     affiliate engaged in business substantially similar to that of the Company,
     shall be promptly disclosed to the Company. Employee hereby assigns and
     transfers to the Company all his right, interest and title thereto, and
     such improvements, discoveries, inventions, designs, documents, licenses
     and patents, or other data shall become the property of the Company. During
     the term of this Agreement and at any time thereafter, upon request of the
     Company, Employee will join and render assistance in any proceedings and
     execute any papers necessary to file and prosecute applications for, and to
     acquire, maintain and enforce, letters, patents, trademarks, registrations
     and/or copyrights, both domestic and foreign, with respect to such
     improvements, discoveries, inventions, designs, documents, licenses and
     patents, or other data as required for vesting and maintaining title to
     same in the Company.

     acknowledges that the terms "Confidential and Proprietary Information"
     shall mean any and all information not in the public domain, in any form,
     emanating from or relating to the Company and its subsidiaries and
     affiliates, including, but not limited to, trade secrets, technical
     information, costs, designs, drawings, processes, systems, methods of
     operation and procedures, formulae, test data, know-how, improvements,
     price lists, financial data, code books, invoices and other financial
     statements, computer programs, discs and printouts, sketches and plans
     (engineering or otherwise), customer lists, telephone numbers, names,
     addresses, information about equipment and processes (including
     specifications and operating manuals), or any other compilation of
     information written or unwritten that is used in the business of the
     Company or any subsidiary or affiliate that gives the Company or any
     subsidiary or affiliate any opportunity to obtain an advantage over
     competitors of the Company who do not know or use


     such information. Employee agrees and acknowledges that all Confidential
     and Proprietary information, in any form, and all copies and extracts
     thereof, is and are and shall remain the sole and exclusive property of the
     Company, and upon termination of his employment with the Company, Employee
     hereby agrees to return to the Company the originals and all copies of any
     Confidential and Proprietary Information provided to or acquired by
     Employee during the term of his employment. Except as ordered by a court of
     competent jurisdiction, Employee expressly agrees never to disclose to any
     person (except to other Company employees, and then only on a "need to
     know" basis) or entity any Confidential and Proprietary Information either
     during the term of this Agreement or at any time after termination of his
     employment, except with the express written authorization and consent of
     the Company.

9.3  CUSTOMER & CLIENT INFORMATION: Employee understands and acknowledges that
     each customer and client of the Company or its subsidiaries or affiliates
     will disclose information that will be within the Company's control in
     connection with the Company's furnishing of services to its customers and
     clients. Employee covenants and agrees to hold such information in the
     strictest confidence and shall treat such information in the same manner
     and be obligated by the provisions of this Agreement as if such information
     were Confidential and Proprietary Information as defined in Section 9.2

10.  COVENANT NOT TO COMPETE: During the term of employment and for a period of
     TWO (2) years after the termination of Employee's employment by the
     Company, Employee shall not directly or indirectly own, manage, operate,
     control or be employed by or participate in the ownership, management,
     operation or control of any business in the area which is the type and
     character engaged in and competitive with that of the Company. Employee
     shall not, during the term of this Agreement, have any other paid
     employment other than with a subsidiary or affiliate of the Company, except
     with the prior approval of the Board.

11.  AMENDMENTS OR ADDITIONS; ACTION BY BOARD: No amendments or additions to the
     Agreement shall be binding unless in writing and signed by all parties
     thereto. The prior approval by a majority affirmative vote of the full
     Board shall be required in order for the Company to authorize any
     amendments or additions to this Agreement, to give any consents or waivers
     of provisions of this Agreement, or to take any other action under this
     Agreement including any Notice of Termination.


12.1 NOTICES: Any notice required or permitted hereunder shall be given in
     writing and shall be personally delivered or mailed by first class
     registered or certified mail, postage prepaid, return-receipt-requested, or
     transmitted by facsimile, telegram or telex, addressed to the Company or
     Employee at the address set forth in this Agreement, or at such other
     addresses as such party may designate by five business day advance written
     notice to the other party. Each notice or communication that shall have
     been transmitted in the manner described above, or that shall have been
     delivered to a telegraph company, shall be deemed sufficiently given,
     served, sent or received for purposes at such time as it is


     sent to the addressee (with the return receipt, delivery receipt or (with
     respect to a telex) the answer back being deemed conclusive, but not
     exclusive, evidence of such sending) or at such time as delivery is refused
     by the addressee upon presentation.

12.2 SEVERABILITY: Nothing in this Agreement shall be construed so as to require
     the commission of any act contrary to law and wherever there is any
     conflict between any provision of this Agreement and any law, statute,
     ordinance, order or regulation, the latter shall prevail, but in such event
     any necessary action will be taken to bring it within applicable legal
     requirements. If any provision of this Agreement should be held invalid or
     unenforceable, the remaining provisions shall be unaffected by such a

12.3 COMPLETE AGREEMENT: This Agreement contains the entire Agreement and
     understanding between the parties relating to the subject matter hereof,
     and supersedes any prior understandings, agreements or representations by
     or between the parties, written or oral, relating to the subject matter

12.4 SUCCESSORS OR ASSIGNS: This Agreement and the rights and obligations of the
     parties hereto shall bind and inure to the benefit of any successor or
     successors of the Company by way of reorganization, merger or consolidation
     and any assignee of all or substantially all of its business assets, but
     except as to any such successor or assignee of the Company, neither this
     Agreement nor any rights or benefits hereunder may be assigned by the
     Company or Employee. However, in the event of death of Employee all rights
     to receive payments hereunder shall become rights of Employee's estate.

12.5 SECTION HEADINGS: The section headings used in this Agreement are included
     solely for convenience and shall not affect, or be used in connection with,
     the interpretation of this Agreement.

12.6 GOVERNING LAW: This Agreement shall be governed and construed in accordance
     with the laws of the State of Delaware.

12.7 ARBITRATION: Any and all disputes between the parties arising under this
     Agreement shall be finally decided through binding arbitration before
     Judicial Arbitration & Mediation Services, Inc. ("JAMS/ENDISPUTE") in San
     Francisco, California, and judgment on any arbitration award may be entered
     in any court having jurisdiction over the parties or their assets.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
this date, October 20, 1999.

COMPANY:                                    EMPLOYEE:

By:      /S/ PATRICK A. GROTTO              By:      /S/ ROBERT S. SHERMAN
    -----------------------------               --------------------------------
Name:    Patrick A. Grotto                           Name:    Robert S. Sherman
Title: Chairman & Chief Executive Officer   SSN: