Employment Agreement - LivePerson Inc. and Timothy E. Bixby
EMPLOYMENT AGREEMENT
This Agreement made effective as of June 23, 1999 by and between LivePerson,
Inc. (the "Company"), a Delaware corporation, and Timothy E. Bixby,
("Executive").
Whereas the Company wishes to retain the services of the Executive for the
period and upon the terms of this Agreement and the Executive wishes to serve in
the employ of the Company on a full time basis for the period and upon the terms
and conditions provided in this Agreement.
Now therefore, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
SECTION I
EMPLOYMENT
The company agrees toe employ the Executive and the Executive agrees to be
employed by the Company, for the Period of Employment as provided in Paragraph
III A below and upon the terms and conditions provided in the Agreement.
SECTION II
POSITION AND RESPONSIBILITIES
During the Period of Employment the Executive agrees to serve as Chief Financial
Officer and to be responsible for the typical management responsibilities
expected of an officer holding such position.
SECTION III
TERMS AND DUTIES
A. PERIOD OF EMPLOYMENT
The period of the Executive's employment under this Agreement will commence as
of the first date and shall continue until terminated as provided in this
agreement.
B. DUTIES
During the Period of Employment and except for illness, incapacity or any
reasonable vacation periods in any calendar year, the Executive shall devote his
business time, attention and skill exclusively to the business and affairs of
the Company. Nothing in this Agreement shall preclude the Executive from
devoting time during reasonable periods required for:
i. Serving, with prior approval of the Chief Executive
Officer of the Company ("Chief Executive") as a Director
or member of a committee or organization involving no
conflict of interest with the Company.
ii. Delivering lectures and fulfilling speaking obligations.
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iii. Engaging in charitable and community activities.
iv. Investing his personal assets in business that will not
violate this Agreement or require services on the part
of the Executive in the operation or affairs of the
companies in which those investments are made.
SECTION IV
A. COMPENSATION
For all services rendered by the Executive in any capacity during the Period of
Employment, the Executive shall be compensated as follows:
i. BASE SALARY
The Company shall pay the Executive a fixed Base Salary at the rate of not less
than $140,000 per year. Base salary shall be payable according to the customary
payroll practices of the Company, but in no event less frequently than once each
month.
ii. ANNUAL INCENTIVE AWARDS
The Executive will be eligible for discretionary annual incentive compensation
awards. The initial target annual bonus shall be $35,000. Target bonus will be
paid, if earned, by January 31st of each year of the term. The initial payment
in January 2000 will be prorated for the portion of calendar 1999 during which
executive is employed by the Company.
iii. LONG TERM INCENTIVE AWARDS
The Executive will be eligible for discretionary stock option awards as may be
awarded by the Board of Directors. The Executive will receive an initial award
of 135,000 LivePerson, Inc. stock options at an exercise price of $1.00 per
share, which, to the maximum extent, will be qualified options. These options
will have a 10 year term and will vest in 25% increments, beginning on 1/1/00.
B. ADDITIONAL BENEFITS
In addition, the Executive will be entitled to participate in all employee
benefit plans which any salaried employees are eligible to participate in.
Nothing in this Agreement will preclude the Company from amending or terminating
any of the plans applicable to salaried employees as long as such amendment or
termination is applicable to all salaried employees. The Executive will be
entitled to three weeks vacation annually.
SECTION V
BUSINESS EXPENSES
The Company will reimburse the Executive for all reasonable travel and other
expenses incurred by the Executive in connection with the performance of his
duties and obligations under this Agreement. Executive will receive the same
expense reimbursement as other senior executives of the company.
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SECTION VI
DISABILITY
In the event of disability of the Executive during the Period of Employment the
Company will continue to pay the Executive according to the compensation
provisions of this Agreement during the period of his disability. However, in
the event the Executive is disabled for a continuous period of 90 days or more,
the Company may terminate the employment of the Executive and all unvested stock
options held by the Executive which would have vested during the 12 months
following such termination shall be deemed vested on the date of such
termination and shall remain exercisable until the applicable expiration dates
contained in the applicable stock option agreements pursuant to which such
options were granted. In addition, normal compensation will cease except for
earned but unpaid Base Salary and Incentive Compensation Awards which would be
payable in a pro-rated basis for the year in which the termination occurs. The
Company will also continue the benefits described in this Agreement for 12
months subsequent to such termination.
SECTION VII
DEATH
In the event of death of the Executive during the Period of Employment the
Company's obligation to make payments under this Agreement shall cease as of the
date of death, except for earned but unpaid Base Salary and Incentive
Compensation Awards which will be paid on a pro-rated basis for that year. All
unvested options held by the executive which would have vested during the 12
months following the death shall be deemed vested on the date of death.
SECTION VIII
EFFECT OF TERMINATION OF EMPLOYMENT
A. If the Executive's employment terminates due to either a Without Cause
Termination or a Constructive Discharge, as defined later in this Agreement,
the Company will continue to pay the Executive his Base Salary for a period
of two months following such Termination or Constructive Discharge. Earned
but unpaid Base Salary and Incentive Compensation Awards will be paid in a
lump sum at such time. The benefits described in this Agreement will
continue for two months. In the event of any such Without Cause Termination
or Constructive Discharge, all unvested stock options held by the Executive
which would have vested during the twelve months following such termination
shall continue to vest under their original vesting schedule and shall
remain exercisable until the original expiration dates contained in the
applicable stock option agreements pursuant to which such options were
granted.
B. If the Executive's employment terminates due to a Termination for Cause, as
defined later in this Agreement, earned but unpaid Base Salary will be paid
on a pro-rated basis for the year in which the termination occurs. Earned
but unpaid incentive awards for any
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prior years shall be payable in full, but no other payments will be made or
benefits provided by the Company.
C. Upon termination of the Executive's employment other than for reasons due to
death, disability, or pursuant to Paragraph A of this Section and Section
XI, the Period of Employment and the Company's obligation to make payments
under this Agreement will cease as of the date of the termination except as
expressly defined in this Agreement.
D. For this Agreement the following terms have the following meanings:
i. "Termination for Cause" means termination of the
Executive's employment by the Company upon a good faith
determination by the Board of Directors, by written
notice to the Executive specifying the event relied upon
for such termination, due to the Executive's serious,
willful misconduct with respect to his duties under this
Agreement (including but not limited to conviction for a
felony or perpetration of a common law fraud) which has
resulted or is likely to result in material economic
damage to the Company and which, in any case, is not
cured (if such is capable of being cured) within 30 days
after written notice thereof to the Executive.
ii. "Constructive Discharge" means termination of the
Executive's employment by the Executive due to a failure
of the Company to fulfill its obligations under this
agreement in any material respect including any
reduction of the Executive's Base Salary or other
material change by the Company in the functions, duties
or responsibilities of the position which would reduce
the responsibility or scope of the position.
Constructive Discharge shall also mean the removal of
Robert LoCascio as President or CEO of the Company. The
Executive will provide the Company a written notice
which describes the circumstances being relied upon for
termination with respect to the Agreement. The Company
will have 30 days to remedy the situation prior to the
Termination for Constructive Discharge.
iii. "Without Cause Termination" means termination of the
Executive's employment by the Company other than due to
death, disability, expiration of the Period of
Employment or Termination for Cause.
SECTION IX
OTHER DUTIES OF THE EXECUTIVE DURING AND
AFTER THE PERIOD OF EMPLOYMENT
A. The Executive will with reasonable notice during, or after, in which case
Executive will be compensated at $100 per hour, the Period of Employment
furnish information as may be in his possession and cooperate with the
Company as may be reasonably requested in connection with any claims or
legal action in which the Company is or may become a party.
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B. The Executive recognizes and acknowledges that all information pertaining to
the software, business, clients, customers or other relationships of the
Company is confidential and is a unique and valuable asset of the Company.
Access to and knowledge of this information are essential to the performance
of the Executive's duties under this Agreement. The Executive will not
during the Period of Employment or after, except to the extent reasonably
necessary in performance of the duties under this Agreement, give to any
person, firm, governmental agency or other entity any information concerning
the affairs, business, clients, or customers of the Company except as
required by law. The Executive will not make use of this type of information
for his own purposes or for the benefit of any person or organization other
than the Company. The Executive will use his best efforts to prevent the
disclosure of this information by others. All records, memoranda, software
or intellectual property whether made by the Executive or otherwise coming
into his possession are confidential and will remain the property of the
Company.
C. During the Period of Employment and for a 12 month period thereafter (the
"Restricted Period") the Executive will not use his status with the Company
to obtain goods or services from another organization on terms that would
not be available to him in the absence of his relationship to the Company.
D. During the Restricted Period, the Executive will not make any statement or
perform any acts intended to or which the Executive knew or should have
known would have the effect of advancing the interest of any existing or
prospective competitors of the Company or in any way injuring the interest
of the Company.
E. During the Restricted Period , the Executive, without prior express written
approval by the Chief Executive, will not engage with, or directly or
indirectly own or hold proprietary interest in, manage, operate, or control
or join or participate in the ownership, management, operation or control
of, or furnish any capital to or be connected in any manner with, any party
which competes with the business of the Company. For the purposes of this
Agreement, proprietary interest means legal or equitable ownership, whether
through stock holding or otherwise, or an equity interest in a business,
firm or entity or ownership of more than 5% of any class of equity interest
in a publicly-held company and the term "affiliate" shall include all
subsidiaries and licensees of the Company.
F. During the Restricted Period, the Executive, without express written
approval from the Chief Executive, will not solicit any clients of the
Company for any existing business of the Company.
G. During the Restricted Period, the Executive will not solicit or induce any
employee of the Company to terminate their employment with the Company, nor
shall the executive during such period directly or indirectly engage,
employ, compensate or cause or permit any person with which the Executive is
affiliated to engage or employ any employee of the Company.
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H. The Company's obligation to make any payments after the Period of Employment
shall cease upon any violation of this Section IX. The company must first
provide written notice to the Executive specifying the act which has
violated this Section IX, and if such violation is not cured within 15 days,
if capable of being cured, than the Company will inform the Executive of its
termination of its post-employment payments.
I. The period of time during which the provisions of this Section IX shall be
in effect shall be extended by the length of time during which the Executive
is in breach of this section.
J. The Executive agrees that the restrictions contained in this section IX are
essential element of the compensation the Executive is granted hereunder and
but for the Executive's agreement to comply with such restrictions, the
Company would not have entered into this Agreement.
SECTION X
INDEMNIFICATION, LITIGATION
A. The Company will indemnify the Executive to the fullest extent permitted by
the laws of Delaware in effect at that time, or the certificate of
incorporation and by-laws of the company, whichever affords the greater
protection to the Executive.
B. In the event of litigation or other proceeding between the Company and the
Executive with respect to the subject matter of this Agreement, the Company
shall reimburse the Executive for all reasonable costs and expenses related
to the litigation or proceeding, including attorney's fees and expenses,
provided that the litigation or proceeding results in either settlement
requiring the Company to make a payment to the Executive or judgment in
favor of the Executive.
SECTION XI
CHANGE IN CONTROL
In the event there is a Change in Control of the ownership of the Company, and
the Executive is either terminated under a Without Cause Termination or
Constructive Discharge, then the Company shall pay to the Executive a lump sum
amount equal to 100% of his Annual Base Salary as in effect at the time of such
termination. In addition, a) earned but unpaid Base Salary and Incentive
Compensation Awards will be paid on a pro-rated basis for the year in which the
termination occurs; b) any stock options granted to the Executive prior to
termination will be fully vested upon termination and shall remain exercisable
until the applicable expiration dates contained in the applicable stock options
agreements pursuant to which such stock options were granted; and c) the
benefits described in this Agreement will be continued for one year from the
date of termination.
A "Change in Control" shall be deemed to have occurred if (i) a tender offer
shall be made and consummated for 50.1% or more of the outstanding voting
securities of the Company (ii) the
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Company shall be merged or consolidated with another company and as a result
less than 50% of the outstanding voting securities of the surviving corporation
shall be owned in the aggregate by the former shareholder of the Company, (iii)
the Company shall sell substantially all of its assets to another company which
is not a subsidiary of the Company, or (iv) a person, within the meaning of
Section 3(a)(9) or of Section 13(d) (3) of the Securities Act of 1934 shall
acquire 51% or more of the outstanding voting securities of the Company.
SECTION XII
WITHHOLDING TAXES
The company may directly or indirectly withhold from any payments under this
Agreement all federal, state, city or other taxes that shall be required
pursuant to any law or governmental regulation.
SECTION XIII
EFFECTIVE PRIOR AGREEMENTS
This Agreement contains the entire understanding between the Company and the
Executive with respect to the subject matter. Where there are conflicting
provisions between this Agreement and any stock option agreements made between
the Executive and the Company, the terms of this Agreement shall prevail.
SECTION XIV
CONSOLIDATION, MERGER OR SALE OF ASSETS
Nothing in this Agreement shall preclude the Company from consolidating or
merging into or with, or transferring all or substantially all of its assets to,
another corporation which assumes this Agreement and all obligations of the
Company hereunder. Upon such a consolidation, merger or sale of assets the term
"Company" as used will mean the other corporation and this Agreement shall
continue in full force and effect.
SECTION XV
MODIFICATION
This Agreement may not be modified or amended except in writing signed by the
parties. No term or condition of this Agreement will be deemed to have been
waived except in writing by the party charged with the waiver. A waiver shall
operate only as to the specific term or condition waived and will not constitute
a waiver for the future or act on anything other than that which is specifically
waived.
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SECTION XVI
GOVERNING LAW
This Agreement has been executed and delivered in the State of New York and its
validity, interpretation, performance and enforcement shall be governed by the
laws of that state.
IN WITNESS WHEREOF the undersigned have executed this Agreement as of the date
just above written.
LivePerson, Inc.
/s/ Robert LoCascio
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Robert LoCascio, President
/s/ Timothy E. Bixby
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Timothy E. Bixby