Exhibit 10.16

 

MILLENNIAL MEDIA, INC.

 

KEY EMPLOYEE AGREEMENT

 

This KEY EMPLOYEE AGREEMENT (the “Agreement”) is entered into effective
January 25, 2014 (the “Effective Date”) by and between MICHAEL BARRETT (the
“Executive”) and MILLENNIAL MEDIA, INC., a Delaware corporation (the “Company”).

 

The Company desires to employ the Executive and, in connection therewith, to
compensate the Executive for Executive’s personal services to the Company; and

 

The Executive wishes to be employed by the Company and provide personal services
to the Company in return for certain compensation.

 

Accordingly, in consideration of the mutual promises and covenants contained
herein, the parties agree to the following:

 

1.                                      EMPLOYMENT BY THE COMPANY.

 

1.1                               Position.  Subject to the terms set forth
herein, the Company agrees to employ Executive in the position of President and
Chief Executive Officer, and Executive hereby accepts such employment.  During
the term of Executive’s employment with the Company, subject to Section 4.1,
Executive will devote Executive’s best efforts and substantially all of
Executive’s business time and attention to the business of the Company (except
for vacation periods as set forth herein and reasonable periods of illness or
other incapacities permitted by the Company’s general employment policies).

 

1.2                               Duties.  Executive shall serve as the Chief
Executive Officer of the Company, reporting to the Board of Directors of the
Company (the “Board”) and performing such duties and having such authority and
powers as are customarily associated with the chief executive officer of a
company together with such other duties as are consistent with that position and
assigned to the Executive from time to time by the Board.  Executive will also
be nominated as a member of the Board and shall serve on the Board subject to
approval by the Company’s stockholders.

 

1.3                               Other Employment Policies.  The employment
relationship between the parties shall also be governed by the general
employment policies and practices of the Company, including those relating to
protection of confidential information and assignment of inventions, except that
when the terms of this Agreement differ from or are in conflict with the
Company’s general employment policies or practices, this Agreement shall
control.

 

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2.                                      COMPENSATION.

 

2.1                               Salary.  As of the Effective Date, Executive
shall receive for Executive’s services to be rendered hereunder an annualized
base salary of $500,000.  Executive’s base salary is subject to standard federal
and state payroll withholding requirements, payable in accordance with Company’s
standard payroll practices.  This amount will be reviewed each year during the
term of Executive’s employment in accordance with the Company’s standard
practices and will be subject to increase, if any, as may be approved by the
Board (or Compensation Committee thereof), but may not be decreased during the
term of Executive’s employment without Executive’s prior written consent except
under the circumstances described in Section 6.4(b)(ii) below (Executive’s
salary, as may be increased or decreased in accordance with this Agreement from
time to time is hereinafter referred to as “Base Salary”).

 

2.2                               Bonus.  Executive shall be eligible for an
annual incentive bonus award opportunity in respect of each fiscal year during
his term of employment (the “Annual Bonus”).  As of the Effective Date,
Executive shall have the opportunity to earn an annual incentive bonus award
equal to a maximum amount of 80% of Base Salary.  Any Annual Bonus shall be
awarded by the Board in its sole discretion based upon an annual incentive plan
adopted by the Board (or Compensation Committee thereof) at or near the
beginning of each fiscal year during the term hereof.  Any Annual Bonus shall be
paid to Executive at the same time as annual bonuses are generally payable to
other senior executives of the Company, but in all events, any Annual Bonus
earned pursuant to this Section 2.2 will be paid on or before March 15 of the
year following the year for which it is earned.

 

2.3                               Equity Compensation.

 

(a)                                 Stock Option.  As soon as practicable after
the Effective Date, and subject to approval by the Board, Executive shall be
granted an option to purchase 1,500,000 shares of the Company’s common stock 
(the “Initial Option”) pursuant to the Company’s 2012 Equity Incentive Plan, as
may be amended from time to time (the “Plan”).  The Initial Option shall be an
incentive stock option to the extent permissible under Section 422 of the
Internal Revenue Code and have an exercise price equal to the fair market value
of the stock on the date of the grant by the Board.  The complete terms and
conditions of the Initial Option shall be set forth in a separate grant notice
and/or agreement between Executive and the Company.

 

(b)                                 Restricted Stock Units.  In addition, as
soon as practicable after the Effective Date, and subject to approval by the
Board, Executive shall be granted 500,000 Restricted Stock Units (“Initial
RSUs”) pursuant to the Plan.  The complete terms and conditions of the Initial
RSUs shall be set forth in a separate grant notice and/or agreement between
Executive and the Company.  In addition, if Executive meets certain performance
goals as established and determined by the Company in its sole discretion, then
Executive will be eligible to be granted additional RSUs up to the value of
$2,000,000 annually, as decided by the Company in its sole discretion; provided,
however, that for 2015 the value of the RSU grant shall be no less than
$1,500,000.

 

(c)                                  Vesting.  The Initial Option and Initial
RSUs granted to Executive will vest according to the following schedule:

 

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(i)                                    Basic Vesting:  The Initial RSUs shall
vest in four (4) equal quarterly installments on March 31, 2014, June 30, 2014,
September 30, 2014 and December 31, 2014 and the Initial Option shall vest in
twelve (12) equal quarterly installments over the four (4) year period following
the Effective Date, with the first installment vesting on March 31, 2015 and
then thereafter on the last day of each June, September, December and
March through March 31, 2018, in each case subject to Executive’s Continuous
Service (as defined in the Plan) through the applicable vesting date.

 

(ii)                                Acceleration of Vesting Upon Termination
without Cause or Resignation for Good Reason:  In addition, subject to Executive
executing and allowing the Release (as defined below) to become effective in the
manner described in Section 6.1(b) below (1) in the event Executive’s employment
is terminated without Cause or for Good Reason on or before the second
anniversary of the Effective Date, 50% of the then-unvested portion of the
Initial Option and Initial RSUs shall accelerate and become vested as of the
date of Separation from Service, and (2) in the event Executive’s employment is
terminated without Cause or for Good Reason after the second anniversary of the
Effective Date, 100% of the then-unvested portion of the Initial Option shall
accelerate and become vested effective as of the date of Separation from
Service, in each case provided that in no event will Executive receive
acceleration of vesting under both this Section 2.3(c)(ii) and under the portion
of Section 2.3(c)(iii) relating to a Double Trigger Event; and

 

(iii)                            Acceleration of Vesting in Connection with a
Change in Control:  In addition, 50% of the then-unvested portion of the Initial
Option and Initial RSUs shall accelerate upon a “Single Trigger Event” (as
defined below), subject to Executive’s Continuous Service as of immediately
prior to the closing of the Single Trigger Event.  In addition, 100% of the
then-unvested portion of the Initial Option and Initial RSUs shall accelerate
upon a “Double Trigger Event” (as defined below), subject to Executive executing
and allowing the Release (as defined below) to become effective in the manner
described in Section 6.1(b) below (provided that this acceleration is in lieu
of, and not in addition to, any acceleration provided in
Section 2.3(c)(ii) above).

 

(1)                                 A “Single Trigger Event” shall mean that a
“Change in Control” (as such term is defined in the Plan)  has been consummated.

 

(2)                                 A “Double Trigger Event” shall mean that
(1) a “Change in Control” (as such term is defined in the Plan) has been
consummated and (2) Executive has been terminated by the Company without
“cause”, or Executive has resigned from his employment with the Company for
“good reason” (as “cause” and “good reason” are defined below), in either case,
within two (2) months prior to, as of, or within twelve (12) months after, the
date that such Change in Control has been consummated.

 

2.4                               Standard Company Benefits.  Executive shall be
entitled to all rights and benefits for which the Executive is eligible under
the terms and conditions of the standard Company benefits and compensation
practices which may be in effect from time to time and provided by the Company
to its Executives generally, including four (4) weeks of paid vacation subject
to the terms of the Company’s vacation policy.  The Company may adopt, change or
delete plans, policies and provisions in its sole discretion.

 

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2.5                               Expense Reimbursement.  The Company will
promptly reimburse Executive for reasonable business expenses in accordance with
the Company’s standard expense reimbursement policy.  In addition, the Company
will reimburse up to $10,000 in documented legal fees and disbursements incurred
by Executive in connection with the review and negotiation of this Agreement
within fifteen (15) days after Executive submits to the Company documentation
with respect to such legal fees and disbursements, but in no event shall such
reimbursement be paid later than December 31, 2014.

 

3.                                      PROPRIETARY INFORMATION, INVENTIONS,
NON-COMPETITION AND NON-SOLICITATION OBLIGATIONS.

 

3.1                               Agreement.  As a condition of employment,
Executive agrees to execute and abide by the Employee Nondisclosure and
Developments Agreement (the “Proprietary Information Agreement”), which may be
amended by the parties from time to time without regard to this Agreement.  The
Proprietary Information Agreement contains provisions that are intended by the
parties to survive and do survive termination or expiration of this Agreement.

 

4.                                      OUTSIDE ACTIVITIES.

 

4.1                               Other Employment/Enterprise.  Except with the
prior written consent of the Board, Executive will not, while employed by the
Company, undertake or engage in any other employment, occupation or business
enterprise, other than those in which Executive is a passive investor. 
Executive may engage in limited advisory relationships with and serve on the
boards of other companies (provided such companies are not in competitive
markets), scientific research, scholarly writing and publications, and civic and
not-for-profit activities so long as such activities do not materially interfere
with the performance of Executive’s duties hereunder.

 

4.2                               Conflicting Interests.  Except as permitted by
Section 4.3, while employed by the Company, Executive agrees not to acquire,
assume or participate in, directly or indirectly, any position, investment or
interest known by Executive to be adverse or antagonistic to the Company, its
business or prospects, financial or otherwise.

 

4.3                               Competing Enterprises.  While employed by the
Company, except on behalf of the Company, Executive will not directly or
indirectly, whether as an officer, director, stockholder, partner, proprietor,
associate, representative, consultant, or in any capacity whatsoever engage in,
become financially interested in, be employed by or have any business connection
with any other person, corporation, firm, partnership or other entity whatsoever
which were known by Executive to compete directly with the Company, throughout
the world, in any line of business engaged in (or then currently planned to be
engaged in) by the Company; provided, however, that anything above to the
contrary notwithstanding, Executive may own, as a passive investor, securities
of any public competitor corporation, so long as Executive’s direct holdings in
any one such corporation shall not in the aggregate constitute more than 2% of
the voting stock of such corporation.

 

5.                                      FORMER EMPLOYMENT.

 

5.1                               No Conflict With Existing Obligations. 
Executive represents that Executive’s performance of all the terms of this
Agreement and as an Executive of the Company

 

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do not and will not materially breach any agreement or obligation of any kind
made prior to Executive’s employment by the Company, including agreements or
obligations Executive may have with prior employers or entities for which
Executive has provided services.  Executive has not entered into, and agrees
Executive will not enter into, any agreement or obligation, either written or
oral, in conflict herewith.

 

5.2                               No Disclosure of Confidential Information. 
If, in spite of Section 5.1, Executive should find that confidential information
belonging to any former employer might be usable in connection with the
Company’s business, Executive will not intentionally disclose to the Company or
use on behalf of the Company any confidential information belonging to any of
Executive’s former employers (except in accordance with agreements between the
Company and any such former employer); but during Executive’s employment by the
Company Executive will use in the performance of Executive’s duties all
information which is generally known and used by persons with training and
experience comparable to Executive’s own and all information which is common
knowledge in the industry or otherwise legally in the public domain.

 

6.                                      TERMINATION OF EMPLOYMENT. The parties
acknowledge that Executive’s employment relationship with the Company is
at-will.  Either Executive or the Company may terminate the employment
relationship at any time, with or without Cause.  The provisions of Sections 6.1
through 6.6 govern the amount of compensation, if any, to be provided to
Executive upon termination of employment and do not alter this at-will status.

 

6.1                               Termination by the Company Without Cause.

 

(a)                                 The Company shall have the right to
terminate Executive’s employment with the Company at any time without Cause (as
defined in Section 6.2(b) below) by giving notice as described in Section 6.6 of
this Agreement.

 

(b)                                 In the event Executive’s employment is
terminated without Cause, then provided that the Executive executes a general
release in favor of the Company, in form and substance reasonably acceptable to
the Company (the “Release”), which Release is effective as of the date required
by the Release agreement, but in no event later than 60 days following
Executive’s separation from service (as defined under Treasury Regulation
Section 1.409A-1(h), and without regard to any alternate definition thereunder,
a “Separation from Service”), and subject to Section 6.1(c), then:

 

(i)                                    the Company shall continue to pay
Executive as severance Executive’s then-effective Base Salary for a period of
the first twelve (12) months following Executive’s Separation from Service (the
“Severance Period”), less applicable withholdings and deductions, on the
Company’s regular payroll dates;

 

(ii)                                Executive shall be entitled to any
additional acceleration of vesting of the Initial Option and Initial RSUs as set
forth in Section 2.3(c)(ii); and

 

(iii)                            if Executive is participating in the Company’s
group health insurance plans on the Separation from Service, and Executive
timely elects and remains eligible for continued coverage under COBRA, or, if
applicable, state insurance laws, the Company shall pay that portion of
Executive’s COBRA premiums that the Company was paying prior to the

 

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Separation from Service for the Severance Period or for the continuation period
for which Executive is eligible, whichever is shorter (such shorter period, the
“COBRA Payment Period”).  The Company’s COBRA premium payment obligation will
end immediately if the Executive obtains health care insurance from any other
source during the Severance Period.  However, if at any time the Company
determines, in its discretion, that the payment of the COBRA premiums would be
reasonably likely to result in a violation of the nondiscrimination rules of
Section 105(h)(2) of the Internal Revenue Code of 1986, as amended (the “Code”)
or any statute or regulation of similar effect (including, without limitation,
the 2010 Patient Protection and Affordable Care Act, as amended by the 2010
Health Care and Education Reconciliation Act), then in lieu of providing the
Company’s portion of the COBRA premiums, the Company will instead pay Executive,
on the first day of each month of the remainder of the COBRA Payment Period, a
fully taxable cash payment equal to the portion of the COBRA premiums that the
Company was paying prior to the date of Executive’s Separation from Service for
that month, subject to applicable tax withholdings and deductions.

 

(c)                                  The Company will not make any payments to
Executive with respect to any of the benefits pursuant to Section 6.1(b) prior
to the 60th day following Executive’s Separation from Service. On the 60th day
following Executive’s Separation from Service, and provided that Executive has
delivered an effective Release, the Company will make the first payment to
Executive under Section 6.1(b) in a lump sum equal to the aggregate amount of
payments that the Company would have paid Executive through such date had the
payments commenced on the date of Executive’s Separation from Service through
such 60th day, with the balance of the payments paid thereafter on the schedule
described above, subject to any delay in payment required by Section 7.11.

 

(d)                                 The benefits provided to Executive pursuant
to this Section 6.1 are in lieu of, and not in addition to, any benefits to
which Executive may otherwise be entitled under any Company severance plan,
policy or program.

 

6.2                               Termination by the Company for Cause.

 

(a)                                 The Company shall have the right to
terminate Executive’s employment with the Company at any time for Cause by
giving notice as described in Section 6.6 of this Agreement.

 

(b)                                 “Cause” for termination shall mean: 
(i) Executive’s commission of any act constituting a felony or a crime involving
fraud or moral turpitude; (ii) Executive’s wrongful act or omission which
results in material harm to the Company; (iii) Executive’s willful violation of
any material Company policy that has, prior to any alleged violation, been
communicated in writing to the Executive, and which results in material harm to
the Company; (iv) Executive’s material breach of any written agreement between
the Executive and the Company which results in material harm to the Company;
(v) Executive’s conduct that demonstrates gross unfitness to serve the Company
as determined in the sole discretion of the Board; or (vi) breach of fiduciary
duty by Executive which results in an improper benefit to Executive or material
harm to the Company, its shareholders, or their respective interests.

 

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(c)                                  In the event Executive’s employment is
terminated at any time for Cause, Executive will not be entitled to receive
severance pay or any other such severance compensation, except that, pursuant to
the Company’s standard payroll policies, the Company shall pay to Executive the
accrued but unpaid salary of Executive through the date of termination, together
with all compensation and benefits payable to Executive through the date of
termination under any compensation or benefit plan, program or arrangement
during such period.

 

6.3                               Resignation by the Executive.

 

(a)                                 Executive may resign from Executive’s
employment with the Company at any time by giving notice as described in
Section 6.6.

 

(b)                                 In the event Executive resigns from
Executive’s employment with the Company (other than for Good Reason as set forth
in Section 6.4), Executive will not receive severance pay or any other such
severance compensation, except that, pursuant to the Company’s standard payroll
policies, the Company shall pay to Executive the accrued but unpaid salary of
Executive through the date of resignation, together with all compensation and
benefits payable to Executive through the date of resignation under any
compensation or benefit plan, program or arrangement during such period.

 

6.4                               Resignation by the Executive for Good Reason.

 

(a)                                 Provided Executive has not previously been
notified of the Company’s intention to terminate Executive’s employment, the
Executive may resign from Executive’s employment for “Good Reason” within sixty
(60) days after the occurrence of one of the events specified in
Section 6.4(b) below, by giving notice as described in Section 6.6 of this
Agreement.

 

(b)                                 “Good Reason” for resignation shall mean the
occurrence of any of the following without the Executive’s prior written
consent:  (i) a material diminution of Executive’s authority, responsibilities
or duties; provided, however, that the acquisition of the Company and subsequent
conversion of the Company to a division or unit of the acquiring company will
not by itself result in a diminution of Executive’s responsibilities or duties;
(ii) a material diminution by the Company in Executive’s Base Salary; (iii) the
relocation of the Company’s principal offices to a location outside the New York
City, NY metropolitan area, or the Company’s requiring Executive to be based
anywhere other than the Company’s principal offices in New York City; or (iv) a
material breach of this Agreement by the Company, which shall include without
limitation the failure to nominate Executive for re-election to the Board;
provided, that prior to any termination for Good Reason pursuant to clauses (i),
(ii), (iii) or (iv) of this Section 6.4(b), the Executive shall first provide
the Board with reasonable written notice, setting forth the reasons that the
Executive believes exist that give rise to “Good Reason” for resignation,
stating that the Company shall have fifteen (15) business days to cure such
“Good Reason”, and the “Good Reason” has not been cured by the Company within
fifteen (15) business days after such notice has been delivered. 
Notwithstanding the foregoing, any actions taken by the Company to accommodate a
disability of the Executive or pursuant to the Family and Medical Leave Act
shall not be a Good Reason for purposes of this Agreement.

 

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(c)                                  In the event Executive resigns from
Executive’s employment for Good Reason, and subject to Section 6.4(d), the
Executive shall be entitled to receive the same payments and benefits as
Executive would receive under Section 6.1 had Executive been terminated by the
Company without Cause, provided that Executive executes a Release in favor of
the Company that meets the criteria specified in Section 6.1(b) and that
Executive’s receipt of the payments and benefits are subject to all the terms
and conditions of Section 6.1(c).

 

(d)                                 Executive shall not receive any of the
benefits pursuant to Section 6.4(c) unless and until the Release becomes
effective and can no longer be revoked by Executive under its terms.

 

(e)                                  The benefits provided to the Executive
pursuant to this Section 6.4 are in lieu of, and not in addition to, any
benefits to which Executive may otherwise be entitled under any Company
severance plan, policy or program.

 

6.5                               Termination by Virtue of Death or Disability
of the Executive.

 

(a)                                 In the event of Executive’s death during the
term of this Agreement, all obligations of the parties hereunder shall terminate
immediately, and the Company shall, pursuant to the Company’s standard payroll
policies, pay to the Executive’s legal representatives Executive’s accrued but
unpaid salary through the date of death together with all compensation and
benefits payable to Executive through the date of death under any compensation
or benefit plan, program or arrangement during such period; provided that,
subject to Executive or a representative of Executive’s estate executing and
allowing the Release to become effective in the manner described in
Section 6.1(b) above, the Initial Option and the Initial RSUs shall be subject
to the same accelerated vesting as would apply under Section 2.3(c)(ii) as if
Executive’s employment had been terminated without Cause or for Good Reason.

 

(b)                                 Subject to applicable state and federal law,
the Company shall at all times have the right, upon written notice to the
Executive, to terminate this Agreement based on the Executive’s Disability (as
defined below).  Termination by the Company of the Executive’s employment based
on “Disability” shall mean termination because the Executive is unable to
perform the essential functions of Executive’s position with or without
accommodation due to a disability (as such term is defined in the Americans with
Disabilities Act) for six months in the aggregate during any twelve month
period. This definition shall be interpreted and applied consistent with the
Americans with Disabilities Act, the Family and Medical Leave Act and other
applicable law.  In the event Executive’s employment is terminated based on the
Executive’s Disability, Executive will not receive severance pay or any other
such compensation; provided, however, the Company shall, pursuant to the
Company’s standard payroll policies, pay to Executive the accrued but unpaid
salary of Executive through the date of termination, together with all
compensation and benefits payable to Executive through the date of termination
under any compensation or benefit plan, program or arrangement during such
period.

 

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6.6                               Notice; Effective Date of Termination.

 

(a)                                 Termination of Executive’s employment
pursuant to this Agreement shall be effective on the earliest of:

 

(i)                                    immediately after the Company gives
written notice to Executive of Executive’s termination without Cause, unless the
Company specifies a later date, in which case, termination shall be effective as
of such later date;

 

(ii)                                immediately after the Company gives written
notice to Executive of Executive’s termination for Cause;

 

(iii)                            immediately upon the Executive’s death;

 

(iv)                             thirty (30) days after the Company gives
written notice to Executive of Executive’s termination on account of Executive’s
disability, unless the Company specifies a later date, in which case,
termination shall be effective as of such later date, provided, that Executive
has not returned to the full time performance of Executive’s duties prior to
such date; or

 

(v)                                 thirty (30) days after the Executive gives
written notice to the Company of Executive’s resignation and (in the case of a
resignation for Good Reason) otherwise fully complies with the procedures set
forth in Section 6.4(b) above, unless the Company agrees to a different date at
any time between the date of notice and the date of resignation, in which case
the Executive’s resignation shall be effective as of such other date.

 

(b)                                 Executive will receive compensation through
any required notice period in the event of termination for any reason.  However,
the Company reserves the right to require that the Executive not perform any
services or report to work during any required notice period.

 

7.                                      GENERAL PROVISIONS.

 

7.1                               Notices.  Any notices provided hereunder must
be in writing and shall be deemed effectively given: (a) upon personal delivery
to the party to be notified, (b) when sent by electronic mail, telex or
confirmed facsimile if sent during normal business hours of the recipient, and
if not, then on the next business day, (c) five (5) days after having been sent
by registered or certified mail, return receipt requested, postage prepaid, or
(d) one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt.  All
communications shall be sent to the Company at its primary office location and
to Executive at Executive’s address as listed on the Company payroll, or at such
other address as the Company or the Executive may designate by ten (10) days
advance written notice to the other.

 

7.2                               Severability.  Whenever possible, each
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability will

 

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not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provisions had never been contained herein.

 

7.3                               Waiver.  If either party should waive any
breach of any provisions of this Agreement, Executive or it shall not thereby be
deemed to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.

 

7.4                               Complete Agreement.  This Agreement, together
with the Proprietary Information Agreement, constitutes the entire agreement
between Executive and the Company with regard to the subject matter hereof. 
This Agreement is the complete, final, and exclusive embodiment of their
agreement with regard to this subject matter and supersedes any prior oral
discussions or written communications and agreements.  This Agreement is entered
into without reliance on any promise or representation other than those
expressly contained herein, and it cannot be modified or amended except in
writing signed by Executive and an authorized officer of the Company.

 

7.5                               Counterparts.  This Agreement may be executed
in separate counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one and the same
Agreement.

 

7.6                               Headings.  The headings of the sections hereof
are inserted for convenience only and shall not be deemed to constitute a part
hereof nor to affect the meaning thereof.

 

7.7                               Successors and Assigns.  This Agreement is
intended to bind and inure to the benefit of and be enforceable by Executive and
the Company, and their respective successors, assigns, heirs, executors and
administrators, except that Executive may not assign any of Executive’s duties
hereunder and Executive may not assign any of Executive’s rights hereunder
without the written consent of the Company.

 

7.8                               Survival.  Executive’s obligations under the
Proprietary Information Agreement shall survive termination of Executive’s
employment with the Company, as provided therein.

 

7.9                               Choice of Law.  All questions concerning the
construction, validity and interpretation of this Agreement will be governed by
the law of the State of Maryland.

 

7.10                        Resolution of Disputes.  Any controversy arising out
of or relating to this Agreement or the breach hereof shall be settled by
binding arbitration in accordance with the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association (before a panel of
arbitrators) and judgment upon the award rendered may be entered in any court
having jurisdiction thereof.  The location for the arbitration shall be the New
York City, NY metropolitan area.  Any award made by such panel shall be final,
binding and conclusive on the parties for all purposes, and judgment upon the
award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.  The arbitrators’ fees and expenses and all administrative
fees and expenses associated with the filing of the arbitration shall be borne
by the Company; provided, however, that at Executive’s option, Executive may

 

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voluntarily pay up to one-half the costs and fees. The parties acknowledge and
agree that their obligations under this arbitration agreement survive the
termination of this Agreement and continue after the termination of the
employment relationship between Executive and the Company.

 

7.11                        Application of Section 409A. It is intended that all
of the benefits provided under this Agreement satisfy, to the greatest extent
possible, the exemptions from the application of Section 409A of the Code and
the regulations and other guidance thereunder and any state law of similar
effect (collectively, “Section 409A”) provided under Treasury Regulations
Sections 1.409A-1(b)(4), 1.409A-1(b)(5), and 1.409A-1(b)(9), and this Agreement
will be construed to the greatest extent possible as consistent with those
provisions. To the extent not so exempt, this Agreement (and any definitions in
this Agreement) will be construed in a manner that complies with Section 409A,
and incorporates by reference all required definitions and payment terms. For
purposes of Section 409A (including, without limitation, for purposes of
Treasury Regulations Section 1.409A-2(b)(2)(iii)), Executive’s right to receive
any installment payments under this Agreement will be treated as a right to
receive a series of separate payments and, accordingly, each installment payment
under this Agreement will at all times be considered a separate and distinct
payment. Notwithstanding anything to the contrary set forth herein, any payments
and benefits provided under this Agreement (or under any other arrangement with
Executive) that constitute “deferred compensation” shall not commence in
connection with Executive’s termination of employment unless and until Executive
has also incurred a Separation from Service.  If the Company determines that any
of the payments or benefits upon a Separation from Service provided under this
Agreement (or under any other arrangement with Executive) constitute “deferred
compensation” under Section 409A and if Executive is a “specified employee” of
the Company (as defined in Section 409A(a)(2)(B)(i) of the Code) at the time of
his Separation from Service, then, solely to the extent necessary to avoid the
incurrence of the adverse personal tax consequences under Section 409A, the
timing of the payments upon a Separation from Service will be delayed as
follows: on the earlier to occur of (i) the date that is six months and one day
after the effective date of Executive’s Separation from Service, and (ii) the
date of Executive’s death (the earlier date, the “Delayed Initial Payment
Date”), the Company will (A) pay to Executive a lump sum amount equal to the sum
of the payments upon Separation from Service that Executive would otherwise have
received through the Delayed Initial Payment Date if the commencement of the
payments had not been delayed pursuant to this Section 7.11, and (B) begin
paying the balance of the payments in accordance with the applicable payment
schedules set forth above. No interest will be due on any amounts so deferred.

 

7.12                        Golden Parachute Excise Tax.  The Company and
Executive agree that Executive’s execution of a non-competition agreement is a
material inducement to the severance payments and benefits provided pursuant to
this Agreement, and the Company further agrees such severance payments and
benefits are payable on account of such non-competition agreement. 
Notwithstanding the foregoing, if any payment or benefit Executive would receive
from the Company or otherwise in connection with a Change in Control (as defined
in the Plan) or other similar transaction (“Payment”) would (i) constitute a
“parachute payment” within the meaning of Section 280G of the Code, and (ii) but
for this sentence, be subject to the excise tax imposed by Section 4999 of the
Code (the “Excise Tax”), then such Payment will be equal to the Reduced Amount. 
The “Reduced Amount” will be either (x) the largest portion of the Payment

 

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that would result in no portion of the Payment being subject to the Excise Tax,
or (y) the largest portion, up to and including the total, of the Payment,
whichever amount ((x) or (y)), after taking into account all applicable federal,
state and local employment taxes, income taxes, and the Excise Tax (all computed
at the highest applicable marginal rate), results in Executive’s receipt of the
greater economic benefit notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.  If a Reduced Amount will give rise to the
greater after tax benefit, the reduction in the Payments will occur in the
following order: (a) reduction of cash payments; (b) cancellation of accelerated
vesting of equity awards other than stock options; (c) cancellation of
accelerated vesting of stock options; and (d) reduction of other benefits paid
to Executive.  Within any such category of payments and benefits (that is, (a),
(b), (c) or (d)), a reduction will occur first with respect to amounts that are
not “deferred compensation” within the meaning of Section 409A and then with
respect to amounts that are.  In the event that acceleration of compensation
from Executive’s equity awards is to be reduced, such acceleration of vesting
will be canceled, subject to the immediately preceding sentence, in the reverse
order of the date of grant.

 

The registered public accounting firm engaged by the Company for general audit
purposes as of the day prior to the effective date of the event described in
Section 280G(b)(2)(A)(i) of the Code will perform the foregoing calculations. 
If the registered public accounting firm so engaged by the Company is serving as
accountant or auditor for the acquirer or is otherwise unable or unwilling to
perform the calculations, the Company will appoint a nationally recognized firm
that has expertise in these calculations to make the determinations required
hereunder.  The Company will bear all expenses with respect to the
determinations by such independent registered public accounting firm required to
be made hereunder.  The firm engaged to make the determinations hereunder will
provide its calculations, together with detailed supporting documentation, to
the Company and Executive within thirty (30) calendar days after the date on
which Executive’s right to a Payment is triggered (if requested at that time by
the Company or Executive) or such other time as reasonably requested by the
Company or Executive.  Any good faith determinations of the independent
registered public accounting firm made hereunder will be final, binding and
conclusive upon the Company and Executive.

 

IN WITNESS WHEREOF, the parties have executed this Key Employee Agreement on the
Effective Date.

 

 

 

MILLENNIAL MEDIA, INC.

 

 

 

 

 

By:

/s/ Michael Avon

 

 

Michael Avon

 

 

Chief Financial Officer

 

 

 

 

 

/s/ Michael Barrett

 

Michael Barrett

 

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