EXHIBIT 10.15
Personal and Confidential
January 17, 2007
Dwayne Black
531 Hahn Drive
Shakopee, MN 55379
RE: Offer of Employment
Dear Dwayne:
Shutterfly, Inc. (the “Company” or “Shutterfly”) is pleased to offer you the
opportunity to join Shutterfly. You are being offered a position as SVP of
Manufacturing reporting to me. If you decide to join us, your annual base pay
will be $220,000 less applicable taxes and withholdings. You will be paid
semimonthly in accordance with the Company’s normal payroll procedure.
Additionally, you will be eligible to participate in the Executive Bonus Plan as
approved by the Compensation Committee in 2007. It is anticipated that your
position will be eligible for a bonus up to 25% of your base pay based upon you
and the Company reaching certain goals. Your regular location will be determined
no later than January 31, 2007. You will be required to travel to Hayward, CA
and Charlotte, NC for the first 6 months. Shutterfly may change your position,
compensation, duties and work location from time to time, as it deems
appropriate.
Subject to the approval of the Company’s Board of Directors, you will be granted
an option to purchase 135,000 shares of the Company’s Common Stock, at an
exercise price equal to the fair market value of the Common Stock on the date
the Board grants your stock option or on your first date of employment with the
Company, whichever is later. Your option will be subject to all of the terms,
conditions and restrictions of the Company’s 2006 Stock Plan (the “Plan”) and
the execution of a stock option agreement pursuant to such Plan.
Relocation
Shutterfly will provide reimbursement for actual relocation expenses, not to
exceed $50,000. Such relocation expenses may include the following: the cost of
packing and unpacking, moving and insuring household goods and personal effects
of your household goods in MN to your new location and 2 housing hunting trips
for you and your spouse and transportation costs for you and your family for the
move. Some of these reimbursed relocation expenses may be considered income and

 

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therefore taxable under federal and/or state laws. You are encouraged to seek
advice from a personal tax advisor to determine the impact of relocation income
and new location taxes. If you voluntarily terminate your employment in the
first year of employment you will be responsible for reimbursing the Company a
prorated portion of the relocation expenses.
Temporary Housing Allowance
You will be reimbursed up to $4,000 per month for temporary housing in North
Carolina for your first six (6) months of employment or until you move into a
new residence whichever is earlier. In order to be reimbursed for these costs,
you must submit expenses no later than 30 days after the expense. Due to the
individual nature of this benefit, the housing allowance may be considered
income and taxable under federal and/or state laws. You are encouraged to seek
advice from a personal tax advisor to determine the impact of relocation income
and new location taxes.
Benefits
As an employee, you will also be eligible to receive certain employee benefits
including medical and dental coverage. The medical, dental and vision coverage
begin on your date of hire as an employee. Additionally, you are eligible to
participate in the Fidelity 401k plan. The Company reserves the right to revise
or discontinue any or all of its benefit plans, at any time, in the Company’s
sole discretion. Enclosed is some information on the Company benefit plans.
Holidays
Shutterfly will observe twelve paid holidays in 2007. The holiday schedule may
change at management’s discretion.
Change in Control Benefits
If the Company is subject to a Corporate Transaction (as defined in the Plan)
whereas within the first six (6) months following such transaction (1) you will
no longer be SVP of Manufacturing, or (2) your role is materially diminished,
then you shall be eligible to receive the following enhanced severance benefits
(“Change of Control Benefits”): (i) severance payments equal to six (6) months
of your then-applicable base salary, payable in accordance with the Company’s
standard payroll procedures; and (ii) the unvested portion of any outstanding
options held by you on the date of such Corporate Transaction shall vest for an
additional one year period, and shall remain exercisable for the periods
specified in the relevant option agreements. Your eligibility for the foregoing
Change of Control Benefits is conditioned on you having first signed a release
of claims in a form provided by the Company and returning all Company property.
If the Company is subject to a Corporate Transaction Change and you continue to
report to the President, the severance and accelerated vesting will not be
offered.
Paid Time Off
In order to allow you flexibility with your free time, the Company has a paid
time off policy. You begin to accrue paid time off on your date of hire. You
will accrue fifteen (15) days of paid time off per year for your first three
(3) years of employment, subject to the paid time off policy.

 

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Introductory Period
Your first 90 days of work is known as an “Introductory Period”. This “getting
acquainted” period gives your manager the opportunity to determine your ability
to perform your job. It also provides you with the opportunity to determine if
you are satisfied with the job and the Company. Shutterfly reserves the right to
extend or cut short the duration of the Introductory Period when it determines
appropriate to do so. However, either you or the company can terminate the
employment relationship at any time during or after the Introductory Period,
with or without cause or advance notice.
Employment Eligibility Verification
For purposes of federal immigration law, you will be required to provide to
Shutterfly documentary evidence of your identity and eligibility for employment
in the United States. Such documentation must be provided to us within three
(3) business days of your first date of hire with Shutterfly, or our employment
relationship with you may be terminated.
Employment at Will
If you choose to accept this offer, your employment with Shutterfly will be
voluntarily entered into and will be for no specified period. As a result, you
will be free to resign at any time, for any reason, as you deem appropriate.
Shutterfly will have a similar right and may conclude its employment
relationship with you at any time, with or without cause or advance notice.
Acceptance of Offer
To indicate your acceptance of this the terms of the offer, please sign and date
in the space provided below and return it to Shutterfly, 2800 Bridge Parkway,
Redwood City, CA 94065 attention Human Resources or via Fax to (650) 610 – 5280
no later than January 24, 2007 after which it will expire. A duplicate original
is enclosed for your records. In addition to this letter, your offer of
employment is conditioned upon your: (1) completion and signing of the
Shutterfly employment application; (2) successful completion of a background and
reference check and (3) your signing of the Shutterfly Employee Invention
Assignment and Confidentiality (and any other similar agreements relating to
proprietary rights between you and the Company).
In the event of any dispute or claim relating to or arising out of your
employment relationship with the Company, this agreement, or the termination of
your employment with the Company for any reason (including, but not limited to,
any claims of breach of contract, wrongful termination or age, sex, race,
national origin, disability or other discrimination or harassment), all such
disputes shall be fully, finally and exclusively resolved by binding arbitration
conducted by JAMS under JAMS Employment Arbitration Rules and Procedures then in
effect, which are available online at JAMS’ website at www.jamsadr.org You and
the Company hereby waive your respective rights to have any such disputes or
claims tried before a judge or jury.

 

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This letter agreement, the Shutterfly Employee Invention Assignment and
Confidentiality Agreement, and stock option agreement constitute the entire
agreement between you and the Company regarding the terms and conditions of your
employment with Shutterfly and supersedes any prior representations or
agreements, whether written or oral. This letter, along with any agreements
herein, may not be modified or amended except by a written agreement signed by
the Chief Executive Officer of the Company. If we do not hear from you by
January 22, 2007 we will assume you have decided not to join Shutterfly.
We look forward to your positive response and welcoming you to the Shutterfly
team.
Sincerely,
/s/ Jeff Housenbold
Jeff Housenbold
CEO & President
Enclosures
Acceptance
I agree to and accept employment with Shutterfly on the terms and conditions set
forth in this agreement. I understand and agree that my employment with the
Company is at-will.

                 
Signature:
  /s/ Dwayne Black       Date:   1/25/07
 
               
 
  Dwayne Black            
 
               
Start Date:
 
2/12/07
           
 
               

 

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EMPLOYEE INVENTION ASSIGNMENT AND
CONFIDENTIALITY AGREEMENT
In consideration of, and as a condition of my employment with Shutterfly, Inc.,
a Delaware corporation (the “Company”), I hereby represent to, and agree with
the Company as follows:
• Purpose of Agreement. I understand that the Company is engaged in a continuous
program of research, development, production and marketing in connection with
its business and that it is critical for the Company to preserve and protect its
“Proprietary Information” (as defined in Section 7 below), its rights in
“Inventions” (as defined in Section 2 below) and in all related intellectual
property rights. Accordingly, I am entering into this Employee Invention
Assignment and Confidentiality Agreement (this “Agreement”) as a condition of my
employment with the Company, whether or not I am expected to create inventions
of value for the Company.
• Disclosure of Inventions. I will promptly disclose in confidence to the
Company all inventions, improvements, designs, original works of authorship,
formulas, processes, compositions of matter, computer software programs,
databases, mask works and trade secrets that I make or conceive or first reduce
to practice or create, either alone or jointly with others, during the period of
my employment, whether or not in the course of my employment, and whether or not
patentable, copyrightable or protectable as trade secrets (the “Inventions”).
• Work for Hire; Assignment of Inventions. I acknowledge and agree that any
copyrightable works prepared by me within the scope of my employment are “works
for hire” under the Copyright Act and that the Company will be considered the
author and owner of such copyrightable works. I agree that all Inventions that
(i) are developed using equipment, supplies, facilities or trade secrets of the
Company, (ii) result from work performed by me for the Company, or (iii) relate
to the Company’s business or current or anticipated research and development
(the “Assigned Inventions”), will be the sole and exclusive property of the
Company and are hereby irrevocably assigned by me to the Company. Attached
hereto as Exhibit A is a list describing all inventions, original works of
authorship, developments and trade secrets which were made by me prior to the
date of this Agreement, which belong to me and which are not assigned to the
Company (“Prior Inventions”). I acknowledge and agree that if I use any of my
Prior Inventions in the scope of my employment, or include them in any product
or service of the Company, I hereby grant to the Company a perpetual,
irrevocable, nonexclusive, world-wide, royalty-free license to use, disclose,
make, sell, copy, distribute, modify and create works based on, perform or
display such Prior Inventions and to sublicense third parties with the same
rights.

 

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• Labor Code Section 2870 Notice. I have been notified and understand that the
provisions of Sections 3 and 5 of this Agreement do not apply to any Assigned
Invention that qualifies fully under the provisions of Section 2870 of the
California Labor Code, which states as follows:
ANY PROVISION IN AN EMPLOYMENT AGREEMENT WHICH PROVIDES THAT AN
EMPLOYEE SHALL ASSIGN, OR OFFER TO ASSIGN, ANY OF HIS OR HER
RIGHTS IN AN INVENTION TO HIS OR HER EMPLOYER SHALL NOT APPLY TO
AN INVENTION THAT THE EMPLOYEE DEVELOPED ENTIRELY ON HIS OR HER
OWN TIME WITHOUT USING THE EMPLOYER’S EQUIPMENT, SUPPLIES,
FACILITIES, OR TRADE SECRET INFORMATION EXCEPT FOR THOSE
INVENTIONS THAT EITHER: (1) RELATE AT THE TIME OF CONCEPTION OR
REDUCTION TO PRACTICE OF THE INVENTION TO THE EMPLOYER’S
BUSINESS, OR ACTUAL OR DEMONSTRABLY ANTICIPATED RESEARCH OR
DEVELOPMENT OF THE EMPLOYER; OR (2) RESULT FROM ANY WORK
PERFORMED BY THE EMPLOYEE FOR THE EMPLOYER. TO THE EXTENT A
PROVISION IN AN EMPLOYMENT AGREEMENT PURPORTS TO REQUIRE AN
EMPLOYEE TO ASSIGN AN INVENTION OTHERWISE EXCLUDED FROM BEING
REQUIRED TO BE ASSIGNED UNDER CALIFORNIA LABOR CODE SECTION
2870(a), THE PROVISION IS AGAINST THE PUBLIC POLICY OF THIS
STATE AND IS UNENFORCEABLE.
• Assignment of Other Rights. In addition to the foregoing assignment of
Assigned Inventions to the Company, I hereby irrevocably transfer and assign to
the Company: (i) all worldwide patents, patent applications, copyrights, mask
works, trade secrets and other intellectual property rights, including but not
limited to rights in databases, in any Assigned Inventions, along with any
registrations of or applications to register such rights; and (ii) any and all
“Moral Rights” (as defined below) that I may have in or with respect to any
Assigned Inventions. I also hereby forever waive and agree never to assert any
and all Moral Rights I may have in or with respect to any Assigned Inventions,
even after termination of my work on behalf of the Company. “Moral Rights” mean
any rights to claim authorship of or credit on an Assigned Inventions, to object
to or prevent the modification or destruction of any Assigned Inventions or
Prior Inventions licensed to Company under Section 3, or to withdraw from
circulation or control the publication or distribution of any Assigned
Inventions or Prior Inventions licensed to Company

 

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under Section 3, and any similar right, existing under judicial or statutory law
of any country or subdivision thereof in the world, or under any treaty,
regardless of whether or not such right is denominated or generally referred to
as a “moral right.”
• Assistance. I agree to assist the Company in every proper way to obtain for
the Company and enforce patents, copyrights, mask work rights, trade secret
rights and other legal protections for the Company’s Assigned Inventions in any
and all countries. I will execute any documents that the Company may reasonably
request for use in obtaining or enforcing such patents, copyrights, mask work
rights, trade secrets and other legal protections. My obligations under this
paragraph will continue beyond the termination of my employment with the
Company, provided that the Company will compensate me at a reasonable rate after
such termination for time or expenses actually spent by me at the Company’s
request on such assistance. I appoint the Secretary of the Company as my
attorney-in-fact to execute documents on my behalf for this purpose.
• Proprietary Information. I understand that my employment by the Company
creates a relationship of confidence and trust with respect to any information
of a confidential or secret nature that may be disclosed to me by the Company or
a third party that relates to the business of the Company or to the business of
any parent, subsidiary, affiliate, customer or supplier of the Company or any
other party with whom the Company agrees to hold information of such party in
confidence (the “Proprietary Information”). Such Proprietary Information
includes, but is not limited to, Assigned Inventions, marketing plans, product
plans, business strategies, financial information, forecasts, personnel
information, customer lists and data, and domain names.
• Confidentiality. At all times, both during my employment and after its
termination, I will keep and hold all such Proprietary Information in strict
confidence and trust. I will not use or disclose any Proprietary Information
without the prior written consent of the Company, except as may be necessary to
perform my duties as an employee of the Company for the benefit of the Company.
Upon termination of my employment with the Company, I will promptly deliver to
the Company all documents and materials of any nature pertaining to my work with
the Company and, upon Company request, will execute a document confirming my
agreement to honor my responsibilities contained in this Agreement. I will not
take with me or retain any documents or materials or copies thereof containing
any Proprietary Information.
• No Breach of Prior Agreement. I represent that my performance of all the terms
of this Agreement and my duties as an employee of the Company will not breach
any invention assignment, proprietary information, confidentiality or similar
agreement with any former employer or other party. I represent that I will not
bring with me to the Company or use in the performance of my duties for the
Company any documents or materials or intangibles of a former employer or third
party that are not generally available to the public or have not been legally
transferred to the Company.

 

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• Efforts; Duty Not to Compete. I understand that my employment with the Company
requires my undivided attention and effort during normal business hours. While I
am employed by the Company, I will not, without the Company’s express prior
written consent, provide services to, or assist in any manner, any business or
third party if such services or assistance would be in direct conflict with the
Company’s business interests.
• Notification. I hereby authorize the Company to notify third parties,
including, without limitation, customers and actual or potential employers, of
the terms of this Agreement and my responsibilities hereunder.
• Non-Solicitation of Employees/Consultants. During my employment with the
Company and for a period of one (1) year thereafter, I will not directly or
indirectly solicit away employees or consultants of the Company for my own
benefit or for the benefit of any other person or entity.
• Non-Solicitation of Suppliers/Customers. During my employment with the Company
and after termination of my employment, I will not directly or indirectly
solicit or take away suppliers or customers of the Company if the identity of
the supplier or customer or information about the supplier or customer
relationship is a trade secret or is otherwise deemed confidential information
within the meaning of California law.
• Name & Likeness Rights. I hereby authorize the Company to use, reuse, and to
grant others the right to use and reuse, my name, photograph, likeness
(including caricature), voice, and biographical information, and any
reproduction or simulation thereof, in any form of media or technology now known
or hereafter developed (including, but not limited to, film, video and digital
or other electronic media), both during and after my employment, for whatever
purposes the Company deems necessary.
• Injunctive Relief. I understand that in the event of a breach or threatened
breach of this Agreement by me the Company may suffer irreparable harm and will
therefore be entitled to injunctive relief to enforce this Agreement.
• Governing Law; Severability. This Agreement will be governed by and construed
in accordance with the laws of the State of California, without giving effect to
its laws pertaining to conflict of laws. If any provision of this Agreement is
determined by any court or arbitrator of competent jurisdiction to be invalid,
illegal or unenforceable in any respect, such provision will be enforced to the
maximum extent possible given the intent of the parties hereto. If such clause
or provision cannot be so enforced, such provision shall be stricken from this
Agreement and the remainder of this Agreement shall be enforced as if such
invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Agreement.

 

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• Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed and delivered will be deemed an original, and all
of which together shall constitute one and the same agreement.
• Entire Agreement. This Agreement and the documents referred to herein
constitute the entire agreement and understanding of the parties with respect to
the subject matter of this Agreement, and supersede all prior understandings and
agreements, whether oral or written, between or among the parties hereto with
respect to the specific subject matter hereof.
• Amendment and Waivers. This Agreement may be amended only by a written
agreement executed by each of the parties hereto. No amendment of or waiver of,
or modification of any obligation under this Agreement will be enforceable
unless set forth in a writing signed by the party against which enforcement is
sought. Any amendment effected in accordance with this section will be binding
upon all parties hereto and each of their respective successors and assigns. No
delay or failure to require performance of any provision of this Agreement shall
constitute a waiver of that provision as to that or any other instance. No
waiver granted under this Agreement as to any one provision herein shall
constitute a subsequent waiver of such provision or of any other provision
herein, nor shall it constitute the waiver of any performance other than the
actual performance specifically waived.
• Successors and Assigns; Assignment. Except as otherwise provided in this
Agreement, this Agreement, and the rights and obligations of the parties
hereunder, will be binding upon and inure to the benefit of their respective
successors, assigns, heirs, executors, administrators and legal representatives.
The Company may assign any of its rights and obligations under this Agreement.
No other party to this Agreement may assign, whether voluntarily or by operation
of law, any of its rights and obligations under this Agreement, except with the
prior written consent of the Company.
• Further Assurances. The parties agree to execute such further documents and
instruments and to take such further actions as may be reasonably necessary to
carry out the purposes and intent of this Agreement.
• “At Will” Employment. I understand that this Agreement does not constitute a
contract of employment or obligate the Company to employ me for any stated
period of time. I understand that I am an “at will” employee of the Company and
that my employment can be terminated at any time, with or without notice and
with or without cause, for any reason or for no reason, by either the Company or
myself. I acknowledge that any statements or representations to the contrary are
ineffective, unless put into a writing signed by the Company. I further
acknowledge that my participation in any stock option or benefit program is not
to be construed as any assurance of continuing employment for any particular
period of time. This Agreement shall be effective as of the first day of my
employment by the Company, which is 2/12/07.

 

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          SHUTTERFLY, INC.:   Employee:
 
       
By:
  /s/ Jeff Housenbold   /s/ Dwayne Black
 
       
 
      Signature
 
     
Name:
  Jeff Housenbold    
 
       
 
      Dwayne Black
 
       
Title:
  CEO & President    
 
       

Signature Page to Employee Invention Assignment and Confidentiality Agreement

 

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APPENDIX A
     California Labor Code Section 2870. Application of provision providing that
employee shall assign or offer to assign rights in invention to employer.
     1. Any provision in an employment agreement which provides that an employee
shall assign, or offer to assign, any of his or her rights in an invention to
his or her employer shall not apply to an invention that the employee developed
entirely on his or her own time without using the employer’s equipment,
supplies, facilities, or trade secret information except for those inventions
that either:
     (a) Relate at the time of conception or reduction to practice of the
invention to the employer’s business, or actual or demonstrably anticipated
research or development of the employer; or
     (b) Result from any work performed by the employee for his employer.
     2. To the extent a provision in an employment agreement purports to require
an employee to assign an invention otherwise excluded from being required to be
assigned under paragraph 1, the provision is against the public policy of this
state is unenforceable.

 

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APPENDIX B
PRIOR MATTER
None.