Employment Agreement - priceline.com Inc. and Jeffery Boyd
203.299.8000 info@priceline.com
TELEPHONE E.MAIL
priceline.com
December 30, 1999
Mr. Jeffery Boyd
34 Brookridge Drive
Greenwich, CT 06830
Dear Jeff:
We are very pleased to offer you the position of EVP, General Counsel,
reporting to me, CEO at priceline.com.
As discussed, your start date will be January 4, 2000, on a per diem basis,
at a minimum of 8 hours per week. Your hourly rate will be $120.20. You
will be involved in interim assignments until such time you transition to
your regular assignment. As a regular full-time employee, you will be
compensated at a bi-monthly salary of $10,416.66 less applicable
withholdings, ("Base Salary") (payable on the 15th and last day of each
month, aggregating $250,000.00 annually). This offer also includes
participation in a full range of Company benefit programs as described in
the attached Employee Benefits Summary, except that you will be entitled to
four weeks of vacation annually.
Priceline.com will loan you $2,000,000.00 upon your joining the Company.
The loan will be fully recourse and will accrue interest at the lowest
annual rate which avoids imputation of income under the Federal Internal
Revenue Code. Interest and principal will be payable at maturity of the
loan, which will be five years from the date of the loan. You will be
required to make prepayments of principal and accrued interest in an amount
equal to 25% of your after tax proceeds over $2,000,000.00 from the
exercise of your stock options until termination date of the loan (five
years), at which point any amounts remaining outstanding under the loan
will be forgiven. Any remaining outstanding principal and interest on the
loan will also be forgiven upon a Change in Control, death, a Disability
Termination, a Termination without Cause or a Termination for Good Reason
(each term being used as defined below). Upon commencement of your
employment you will execute a note and option/stock pledge agreement having
terms mutually acceptable to you and the Company to effect the terms of
this paragraph.
This offer also includes participation in the Company*s employee stock
option program. Effective the comniencement date of your employment, you
will receive a grant of options to purchase 500,000 shares of the Company*s
common stock (the "options") in accordance with terms and conditions of the
1999 Omnibus Plan (the "option plan"). Options will vest as follows: 50,000
shares will vest immediately upon date of hire; an additional 50,000 shares
will vest 6 months from your date of hire; an additional 200,000 shares
will vest on the first anniversary of your date of hire; an additional
100,000 shares will vest on the second anniversary of your date of hire;
and the final 100,000 shares will vest on the third anniversary of your
date of hire. The exercise price per share of stock will be determined by
the fair market value of the Company*s common stock at the close of
business on your first day of employment.
Your employment under this letter shall terminate upon the earliest to
occur of any of the following events: Disability. If by reason of the same
or related physical or mental illness or incapacity (as determined in the
reasonable discretion of the Company), you are unable to carry out your
material duties pursuant to this letter for more than six (6) consecutive
months, the Company may terminate your employment for disability (a
"Disability Termination"). Such termination shall be upon thirty (30) days
written notice by a Notice of Disability Termination. A Termination for
Disability hereunder shall not be effective if you return to the full time
performance of your material duties within such thirty (30) day period.
Termination for Good Reason. A Termination for Good Reason means a
tenninalion by you by written notice given within ninety (90) days after
the occurrence of the Good Reason event (as defined below), unless such
circumstances are fully corrected prior to the date of termination
specified in the Notice of Termination for Good Reason. For purposes of
this Agreement, "Good Reason" shall mean the occurrence or failure to cause
the occurrence, as the case may be, without your express written consent,
of any of the following circumstances: (i) any material diminution of your
positions, duties or responsibilities hereunder (except in each case in
connection with the termination of your employment for Cause or Disability
or as a result of your death, or temporarily as a result of your illness or
other absence), the assignment to you of duties or responsibilities that
are inconsistent with your then current and accepted position; a change in
your reporting relationship such that you no longer report directly to the
Chief Executive Officer of the Company, or a reduction in your compensation
and benefits; (ii) removal of, or the nonreelection of, you from officer
positions with the Company specified herein without election to a higher
position; (iii) a relocation of the Company*s main office in Connecticut to
a location outside of the NY metro area; (iv) any material breach by the
Company of any provision of this letter; (v) a Change in Control; or (vi)
failure of any successor to the Company (whether direct or indirect and
whether by merger, acquisition, consolidation or otherwise) to assume (in a
writing delivered to you upon the assignee becoming such) the obligations
of the Company hereunder.
Cause. Your employment hereunder may be terminated by the Company for
Cause. For purposes of this letter, the term "Cause" shall be limited to
(1) willful misconduct by you with regard to the Company which has a
material adverse effect on the Company; (ii) your willful refusal to follow
the proper written direction of the Board, a Committee therof or a more
senior officer of the Company, provided that the foregoing refusal shall
not be "Cause" if you in good faith believe that such direction is illegal,
unethical or immoral and promptly so notify the Board, the Board Committee,
or the more senior officer (whichever is applicable); (iii) substantial and
willful refusal by you to attempt to perform the duties required of you
hereunder (other than any such failure resulting from incapacity due to
physical or mental illness) after a written demand for substantial
performance is delivered to you by the Board or the Chief Executive Officer
of the Company which specifically identifies the manner in which it is
believed that you have substantially and continually refused to perform
your duties hereunder and a reasonable opportunity to cure; (iv) your
committing a crime of moral turpitude; or (v) your being convicted of a
felony (other than a felony involving a traffic violation or as a result of
vicarious liability). For purposes of this paragraph, no act, or failure to
act, on your part shall be considered "willful" unless done or omitted to
be done, by you not in good faith and without reasonable belief that your
action or omission was in the best interests of the Company.
Consequences of Termination of Employment.
Death. If your employment is terminated by reason of your death, your
employment will terminate without further obligations to you or your legal
representatives under this letter except for: (i) any compensation earned
but not yet paid, including and without limitation, any bonus if declared
or earned but not yet paid for a completed fiscal year, any amount of Base
Salary earned but unpaid, any accrued vacation pay payable pursuant to the
Company's policies, which amounts shall be promptly paid in a lump sum to
your estate; (ii) any other amounts or benefits owing to you under the then
applicable employee benefit plans, long term incentive plans or equity
plans and programs of the Company which shall be paid or treated in
accordance with the terms of such plans and programs; (iii) continuation of
your health benefits for your dependents at the same level and cost as if
you were an employee of the Company for twelve (12) months; and (iv) if a
bonus plan is in place, the product of(x) the target annual bonus for the
fiscal year of your death, multiplied by (y) a fraction, the numerator of
which is the number of days of the current fiscal year during Which you
were employed by the Company, and the denominator of which is 365, which
bonus shall be paid when bonuses fbr such period are paid to the other
executives; and (v) forgiveness of the outstanding principal amount and
accrued interest of the loan of $2,000,000.00 referred to above. Further,
your estate, legal representatives, beneficiaries or other designees (as
applicable), will be entitled to all vested Options granted to you
hereunder or after commencement of employment. However, all unvested
Options on the date of your termination will automatically terminate and be
of no further force or effect.
Disability. If your employment is terminated by reason of your Disability,
you shall be entitled to receive the payments and benefits to which your
representatives would be entitled in the event of a termination of
employment by reason of your death plus, to the extent not duplicative of
the foregoing, you shall be entitled to continuation of the benefits
(including without limitation to health, lile, disability and pension) as
if you had been an employee of the Company for twelve (12) months. In
addition you will retain all vested Options but unvested Options will
terminate with your employment effective as of your termination date.
Termination by you for Good Reason or Termination by the Company without
Cause. If (i) you terminate your employment hereunder for Good Reason or
(ii) your employment with the Company is terminated by the Company without
Cause, you shall be entitled to receive, (A) over a period of twelve (12)
months after such termination (the "severance period") an amount equal to
the sum of your Base Salary for the year in which such termination occurs;
(B) any accrued amounts at the date of termination; (C) any other amounts
or benefits owing to you under the then applicable employee benefit, long
term incentive or equity plans and programs of the Company, which shall be
paid or treated in accordance with the terms of such plans and programs;
(D) continuation of the benefits (including without limitation to health,
life, disability and pension) as if you were an employee of the Company for
twelve (12) months, provided that, if such termination is after a Change in
Control, the period of benefit continuation shall be twenty-four
(24)months; (E) if a bonus plan is in place, the product of(x) the target
annual bonus for the fiscal year, multiplied by (y) a fraction, the
numerator of which is the number of days of the current fiscal year during
which Executive was employed by the Company, and the denominator of which
is 365, which bonus shall be paid when bonuses for such period are paid to
the other executives; (F) all vested Options vested as of the effective
date of termination, which shall be exercisable during the severance
period; and (G) Options which are scheduled to vest during the severance
period shall fully vest as of the termination date, and shall be
exercisable during the severance period.
Termination with Cause or Voluntary Resignation without Good Reason or
Retirement. If your employment hereunder is terminated (i) by the Company
for Cause or (ii) by you without Good Reason, you shall be entitled to
receive (A) your Base Salary through the date of termination; (B) any
unreimbursed business expenses payable; and (C) If such termination is by
you without Good Reason, you are entitled to the same payments and benefits
as if terminated by the Company for Cause and you are also entitled to
payment of bonus that has been declared or earned but not yet paid for a
completed fiscal year. If terminated by the Company for Cause or by you
without Good Reason, your rights under all benefits plans and equity grants
shall be determined in accordance with the Company's plans, programs and
grants. You Shall remain liable for payment of the outstanding principal
amount and accrued interest, if any, in respect of the loan of
$2,000,000.00 referred to above.
No Mitigation; No Set-Off. In the event of any termination of employment
hereunder, you shall be under no obligation to seek other employment and
there shall be no offiet against any amounts due you under this Agreement
on account of any remuneration attributable to any subsequent employment
that you may obtain. The amounts payable hereunder shall not be subject to
setoft counterclaim, recoupment, defense or other right which the Company
may have against you or others, except upon obtaining by the Company of a
final unappealable judgment against you.
Change in Control. For purposes of this letter, the term "Change in
Control" shall have the meaning set forth in the 1999 priceline.com omnibus
stock option plan.
This offer is contingent upon the following:
o Your ability to verify your identity and establish your right to work in
the United States, as required by the Immigration Reform and Control Act
of 1986. A list of acceptable documentation is enclosed and must be
brought with you on your first day of employment.
o Your signing the enclosed Agreement Regarding Confidential Information
and Intellectual Property on or before your first date of employment
There are a number of other documents and forms also included with this
offer letter. These should be reviewed and/or completed by your first day
of employment.
Acceptance of this offer constitutes acknowledgment of your status as an
at-will employee. As such, you understand that either you or priceline may
terminate the employment relationship at any time. This letter is not
intended to alter your at-will status. Notwithstanding that your employment
relationship is at-will, you will be entitled to all the compensation and
benefits committed to you in this letter as determined by the facts and
details of your termination of employment.
We are very excited about the prospect of you joining the team at
priceline.com. We are dependent upon people like you sharing your talent
and energy and creativity to ensure our continued growth and success. If
you have any questions, do not hesitate to contact me.
Sincerely,
Richard S. Braddock
Chairman & Chief Executive Officer
Enclosures