TheStreet.com
Term Sheet for Gregory Barton

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·
Title and Reporting Relationship: Executive Vice President, Business and Legal
Affairs, General Counsel and Secretary. Mr. Barton shall report directly to the
Company’s (TSCM’s) Chief Executive Officer (CEO).

·
Full-Time Duties and Service on Board of Trustees of WisdomTree Trust: Gregory
shall devote his full-time work efforts and duties to TSCM throughout his
employment with TSCM. Notwithstanding Gregory’s full-time dedication to TSCM, he
may continue to serve on the Board of Trustees of WisdomTree Trust, provided
that such service does not materially interfere with his ability to perform his
duties for TSCM (including without limitation his duty to serve as Corporate
Secretary for TSCM).

·
Base Salary: $275,000 annualized rate, with potential annual increases at the
discretion of the Compensation Committee.

·
Target Bonus: 75% of Mr. Barton’s annualized rate of base pay at the beginning
of each calendar year, contingent on achieving performance goals established by
TSCM’s Compensation Committee and CEO for each performance year (with input from
Gregory), with potential annual increases to the targeted amount at the
discretion of TSCM’s Compensation Committee and CEO. For the avoidance of doubt,
Gregory’s target bonus for 2009 shall be prorated for the period of 2009 served
as an employee of TSCM (e.g., if Gregory serves as a TSCM employee from July 1,
2009 through December 31, 2009, the 2009 target bonus would be: 75% x $275,000 x
50% (representing one-half of 2009 worked with TSCM) = $103,125).

 
The specific performance objectives applying to Gregory’s 2009 bonus opportunity
shall established by TSCM’s Compensation Committee and CEO within 30 days after
his first day of employment with TSCM, and shall be comprised of:
 
 
o
TSCM’s 2009 operating results versus the objectives established by the
Compensation Committee and CEO  for 2009 (representing 33% of the total 2009
bonus opportunity);

 
o
Gregory’s establishment of a strategy for TSCM’s licensing business, together
with the performance of the licensing business versus operating objectives
established by the Compensation Committee and CEO for the licensing business for
2009 (representing 33% of the total 2009 bonus opportunity);

 
o
The achievement of a material reduction in TSCM’s overall annual legal expenses
(inclusive of Gregory’s base salary) versus the annualized rate of legal fees
experienced by TSCM in 2006, 2007, and 2008 (representing 33% of the total 2009
bonus opportunity).

 
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·
Long-Term Incentive Opportunity:  One-time grant of 175,000 restricted stock
units (RSUs), awarded under TSCM’s 2007 Performance Incentive Plan (with RSUs
being payable in full-value TSCM shares in accordance with the terms of the
annual vesting schedule described below, unless the payment date is accelerated
or the RSUs are forfeited, as provided below). Gregory will have the option to
elect to have his tax withholding obligation in connection with the RSUs
satisfied through the withholding of shares underlying the RSU award.

 
 
o
Grant of RSUs: Granted as soon as practicable after Gregory’s first day of
employment with TSCM.

 
o
Vesting of RSUs:

 
§
Annual Vesting: Unless vesting is accelerated pursuant to an event described
herein, or the RSUs are forfeited prior to vesting, RSUs shall vest according to
the following schedule:

 
 
·
17,500 RSUs shall vest on the 1st anniversary of the RSU grant date;

 
·
An additional 17,500 RSUs shall vest on the 2nd anniversary of the RSU grant
date;

 
·
An additional 17,500 RSUs shall vest on the 3rd anniversary of the RSU grant
date;

 
·
An additional 17,500 RSUs shall vest on the 4th anniversary of the RSU grant
date;

 
·
The remaining 105,000 RSUs shall vest on the 5th anniversary of the RSU grant
date.

 
Shares of TSCM stock underlying RSUs that vest according to the above schedule
shall be distributed to Gregory free and clear of all vesting restrictions (net
of shares withheld to pay taxes, if so elected by Gregory) within 30 days
following the applicable vesting date of such RSUs.
 
 
§
Accelerated Vesting on Certain Events: In the event of the first to occur of any
one of the three events described immediately below in (A), (B), or (C) below,
some or all unvested RSUs that have not been forfeited prior to such event shall
have their vesting accelerated upon the following terms:

 
 
·
(A) A change-in-control (CIC) event (for purposes of this Term Sheet, having the
same definition as provided in the 2007 Performance Incentive Plan) shall result
in immediate 100% vesting of all RSUs that are unvested on the effective date of
consummation of the CIC.

 
·
(B) An involuntary termination of Gregory’s employment without Cause (“Cause”
generally defined as egregious acts such as fraud, commission of a felony, etc.,
determined in the good faith judgment of TSCM’s Compensation Committee) shall
result in partial vesting on the effective date of termination of the following
number of RSUs:

 
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o
87,500 RSUs, PLUS;

 
o
The number of RSUs represented by the product of (i) 87,500 MULTIPLIED by (ii) a
fraction, the numerator of which is the lesser of: (a) 730; or (b) the number of
calendar days from and including Gregory’s 366th calendar day of employment with
TSCM, to and including the effective date of Gregory’s employment termination
under this provision, and the denominator of which is 730 (for the avoidance of
doubt, if Gregory’s employment termination under this provision occurs prior to
the 366th calendar day of Gregory’s employment with TSCM, this fraction shall
equal zero); MINUS

 
o
The number of RSUs that had vested prior to the effective date of Gregory’s
employment termination under this provision.

 
Notwithstanding any other provision of this Term Sheet, accelerated vesting of
RSUs under this provision shall be contingent on Gregory executing a release of
legal claims against TSCM, in such format as is provided in the good faith
judgment of the Compensation Committee and the CEO. In the absence of a properly
executed release of legal claims, all unvested RSUs shall be forfeited without
payment following an involuntary termination without Cause.
 
 
·
(C) A voluntary termination by Gregory for Good Reason (with “Good Reason”
having the definition ascribed to such term under the “Good Reason” safe harbor
provisions of Section 409A of the Internal Revenue Code and the Treasury
Regulations promulgated thereunder (“Section 409A”), all as determined in good
faith by TSCM’s Compensation Committee) shall result in partial vesting on the
effective date of termination of the following number of RSUs:

 
 
o
87,500 RSUs, PLUS;

 
o
The number of RSUs represented by the product of (i) 87,500 MULTIPLIED by (ii) a
fraction, the numerator of which is the lesser of: (a) 730; or (b) the number of
calendar days from and including Gregory’s 366th calendar day of employment with
TSCM, to and including the effective date of Gregory’s employment termination
under this provision, and the denominator of which is 730 (for the avoidance of
doubt, if Gregory’s employment termination under this provision occurs prior to
the 366th calendar day of Gregory’s employment with TSCM, this fraction shall
equal zero); MINUS

 
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o
The number of RSUs that had vested prior to the effective date of Gregory’s
employment termination under this provision.

 
Notwithstanding any other provision of this Term Sheet, accelerated vesting of
RSUs under this provision shall be contingent on Gregory executing a release of
legal claims against TSCM, in such format as is provided in the good faith
judgment of the Compensation Committee and the CEO. In the absence of a properly
executed release of legal claims, all unvested RSUs shall be forfeited without
payment following a voluntary termination for Good Reason.
 
 
§
Death or Disability: In the event of Gregory’s death or disability (generally
defined as a physical or mental condition incapacitating Gregory from the
ability to effectively execute his role with TSCM, as determined in good faith
by TSCM’s Compensation Committee) before the occurrence of any one of the
“Accelerated Vesting” events described above, Gregory shall vest in a prorated
number of the RSUs, with the proration determined as a function of the length of
time served by Gregory with TSCM prior to death or disability in relation to the
two-year period following grant of the RSUs (e.g., a disability at the 1st
anniversary of the RSU grant date would result in vesting and accelerated
delivery of 50% of the RSU award, net of any RSUs that have already vested prior
to death or disability). As an example, and for the avoidance of doubt, if a
death or disability happens immediately after the 1st anniversary of the RSU
grant date, the net number of RSUs that would vest under this provision would
equal [(175,000/2) – 17,500 (the RSUs that vested according to their normal
annual schedule)] = 70,000).

 
 
o
Payment Acceleration Events: Unless sooner forfeited due to a “Forfeiture Event”
described below, and other than the distribution of shares underlying RSUs that
have vested according to their regular vesting schedule (i.e., the 10%, 10%,
10%, 10%, 60% schedule described above in this Term Sheet), all outstanding and
previously undistributed RSUs shall be paid to Gregory on an accelerated basis
following any of the employment termination events described below, with
delivery of the RSU value occurring at the times described below:

 
 
§
Consummation of a CIC, with delivery of RSU value occurring within 30 days after
the effective date of the CIC; or

 
§
An involuntary termination of Gregory’s employment without Cause, in which case,
delivery of RSU value will occur within 30 days after the effective date of
termination, contingent on proper execution of a release of legal claims against
TSCM, as provided in this Term Sheet; or

 
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§
A voluntary termination by Gregory for Good Reason in which case, delivery of
RSU value will occur within 30 days after the effective date of termination,
contingent on proper execution of a release of legal claims against TSCM, as
provided in this Term Sheet; or

 
§
Disability (as defined in Section 409A), in which case, delivery of RSU value
will occur within 30 days after the effective date of Disability; or

 
§
Death, in which case, delivery of RSU value will occur within 30 days after
death.

 
 
o
Forfeiture Events: All RSUs that have not been paid to Gregory by delivery of
the underlying shares (except in the case of voluntary termination without Good
Reason, in which case the prior clause shall be deemed to refer to RSUs that
have not vested) prior to the 5th anniversary of the date of grant of the RSUs
shall be forfeited without payment (regardless of the vested status of the RSUs)
if any one of the following occurs prior to delivery (vesting, in the case of
voluntary termination without Good Reason) of the TSCM shares underlying the RSU
awards:

 
 
§
TSCM involuntarily terminates Gregory’s employment for “Cause”; or

 
§
Gregory voluntarily terminates his employment as without Good Reason prior to
the fifth anniversary of his first day of employment with TSCM; or

 
§
Gregory engages in competitive activity (to be defined in the RSU award
agreement) with TSCM within two years after his last day of employment with
TSCM; or

 
§
Gregory breaches the provisions to be included within the RSU award agreement
pertaining to non-solicitation of employees and clients of TSCM (within the
two-year period following employment termination), confidentiality of
information, or disparagement of TSCM.

 
In addition, TSCM reserves the right to claw back RSU value delivered if within
two years after delivery of the RSU value Gregory engages in competitive
activities that violate the terms of the non-compete/non-solicit covenants to be
included in the RSU award agreement, or if he violates the non-disparagement or
confidentiality provisions of the RSU award agreement.
 
·
General Severance: In the event that, prior to the effective date of a CIC,
Gregory’s employment is involuntarily terminated by TSCM without Cause, then
subject to the caveat prohibiting payment of both general severance and CIC
severance (as described below), TSCM shall pay Gregory a general severance
amount determined according to the following formula, but in no event greater
than 52 weeks of Gregory’s base pay (at the annualized rate in effect
immediately prior to termination):

 
 
o
Four weeks of Gregory’s base pay (at the annualized rate in effect immediately
prior to termination); PLUS

 
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o
An amount of severance represented by the product of: (i) an amount of money
equal to four weeks of Gregory’s base pay (determined by reference to the
annualized rate of base pay in effect immediately prior to termination);
MULTIPLIED by (ii) a fraction, the numerator of which is the number of calendar
days from and including Gregory’s 366th calendar day of employment with TSCM, to
and including the effective date of Gregory’s employment termination under this
provision, and the denominator of which is 365 (for the avoidance of doubt, if
Gregory’s employment termination under this provision occurs prior to the 366th
calendar day of Gregory’s employment with TSCM, this fraction shall equal zero).

 
Notwithstanding any other provision of this Term Sheet, payment of general
severance under this provision shall be contingent on Gregory executing a
release of legal claims against TSCM, in such format as is provided in the good
faith judgment of the Compensation Committee and the CEO. In the absence of a
properly executed release of legal claims, no general severance shall be paid.
 
Subject to the CIC caveat prohibiting payment of both general severance and CIC
severance (as described below), and further subject to execution of a release of
legal claims against TSCM as provided above, TSCM shall pay Gregory the general
severance within 30 days following the effective date of termination. In the
event that Gregory qualifies to receive CIC severance, and if prior to the
payment of CIC severance TSCM has already paid Gregory general severance
amounts, the full value of such general severance amounts paid shall be offset
against any CIC severance payable to Gregory.
 
·
Change-in-Control Severance: Subject to the caveat prohibiting payment of both
general severance and CIC severance (as described above), if a CIC is
consummated prior to November 15, 2011, and if Gregory’s employment is
terminated within two years after the effective date of consummation of the CIC
(i) by TSCM without Cause or (ii) by Gregory for Good Reason, Gregory would be
paid 12 months of base salary at the annualized rate in effect on the date of
employment termination.

 
 
o
For all purposes of this Term Sheet, Gregory shall receive the described
benefits associated with a CIC (i.e., CIC severance and RSU vesting) if Gregory
is employed at the time events or efforts are initiated that directly lead to
consummation of a CIC, provided that such a CIC will only so qualify for this
provision if the consummation of the CIC occurs within six months of Gregory’s
last day of employment.

 
o
Payment shall be made within 30 days after the effective date of the CIC, unless
a delay is necessary to avoid imposition of additional taxes under Section 409A
(in which case, the delay shall be for the minimum time frame necessary to avoid
additional 409A taxes).

 
·
Perks and Health and Welfare Benefits:  Gregory will be eligible to receive
perquisites and general health and welfare benefit coverage at a level at least
equal to those provided to other comparably situated full-time executives of
TSCM.

 
 
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·
Internal Revenue Code Section 409A Saving Clause: TSCM will make all reasonable
efforts to deliver the value in connection with RSUs and CIC severance in a
manner that avoids imposition of additional taxes under Internal Revenue Code
Section 409A.

 
Signed, this 2nd day of June, 2009
 
/s/ William Gruver
 
/s/ Gregory Barton
William Gruver, Compensation Committee Chair
 
Gregory Barton
of TheStreet.com
   

 
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