Exhibit 10.1

 

AMENDMENT
TO
EMPLOYMENT AGREEMENT

 

This Amendment (this “Amendment”) to the Employment Agreement (as defined below)
is made and entered into as of May 26, 2016 by Digital Turbine, Inc., a Delaware
corporation (the “Employer”), and William Stone (the “Executive”). Capitalized
terms used but not defined herein shall have the respective meanings assigned to
them in the Employment Agreement.

 

WHEREAS, the Employer and the Executive entered into that certain Employment
Agreement, dated as of July 31, 2014 (the “Employment Agreement”), pursuant to
which the Executive currently is serving as Chief Executive Officer of the
Employer;

 

WHEREAS, the Board of Directors has determined that the Employer should make
certain amendments to the Employment Agreement as further described herein; and

 

WHEREAS, the Employer and the Executive desire to enter into this Amendment to
effectuate such amendments to the Employment Agreement;

 

NOW, THEREFORE, in consideration of the foregoing, the mutual promises of the
parties hereto and other good and valuable consideration, the receipt and
sufficiency of which hereby are acknowledged, the parties hereto hereby agree to
amend the Employment Agreement, as follows:

 

1.                  Amendment to Section 3 of the Employment Agreement. Section
3 of the Employment Agreement is amended to read as follows:

 

2.                  Term. Subject to the provisions of Section 6, the term of
employment pursuant to this Agreement shall commence on the Transition Date and
such continue through and including March 31, 2018 (the “Term”)

 

3.                  Amendment to Section 4(b)(ii) of the Employment Agreement.
Section 4(b)(ii) of the Employment Agreement is amended by replacing “the Year 1
Period and the Year 2 Period” with “the Year 1 Period, the Year 2 Period and the
Year 3 Period”.

 

4.                  Amendment to Section 4(b)(iii) of the Employment Agreement.
Section 4(b)(iii) of the Employment Agreement is amended to read as follows:

 

(iii) Any bonus amounts due under subsection (b)(i) and (b)(ii) of this Section
4 (x) shall be paid within thirty (30) days after the revenue and EBITDA
criteria are determined for the applicable period in the manner described in
Schedule A, but not later than two and one-half (2-1/2) months following the
later of the last day of the calendar year or the last day of the Employer’s
fiscal year in which the applicable period with respect to which the bonus is
determined ends, and (y) shall be conditioned on the Executive being employed
throughout the entire applicable period with respect to which the bonus is
determined.

 

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5.                  Amendment to Section 4(e) of the Employment Agreement.
Section 4(e) of the Employment Agreement is amended by the addition of the
following subsection (iii) to the end thereof:

 

(iii) On May 26, 2016, the Employer shall grant the Executive a stock option to
purchase 100,000 shares of common stock of the Employer, at an exercise price
equal to the closing price of the Employer’s common stock on the Nasdaq Capital
Market on such date, under the Employer’s Amended and Restated 2011 Equity
Incentive Plan. Such stock option shall be subject to the terms and conditions
of the Employer’s standard stock option agreement under such plan, and shall
vest as follows: (x) options pertaining to 25,000 shares shall vest on the first
anniversary of the grant date; (y) options pertaining to 75,000 shares shall
vest on a monthly basis over the three-year period following the first
anniversary of the grant date (options pertaining to 1/36th of such remaining
shares per month); and (z) all unvested options under such grant shall vest
immediately upon the occurrence of a Change of Control.

 

6.                  Amendment to Section 4(f) of the Employment Agreement.
Section 4(f) of the Employment Agreement is amended by the addition of the
following sentence to the end thereof:

 

The Executive shall be entitled to an additional one-time bonus of One Hundred
Thousand Dollars ($100,000) payable within five (5) days of signing the May 16,
2016 Amendment to this Agreement.

 

7.                  Amendment to Schedule A of the Employment Agreement.
Effective for fiscal periods beginning April 1, 2016 and thereafter (the Year 2
Period and the Year 3 Period), Schedule A of the Employment Agreement is amended
to read as attached to this Amendment. All provisions of the prior Schedule A
that were to be applicable to the Year 2 Period are hereby revoked, terminated
and of no force or effect.

 

8.                  Miscellaneous.

 

a.                   All other provisions of the Employment Agreement not
specifically referenced herein shall remain in full and force and effect.

 

b.                   In the event of a conflict between this Amendment and the
Employment Agreement, this Amendment shall govern.

 

c.                   The Employment Agreement may only be amended further by a
written agreement executed by the parties hereto.

 

d.                  This Amendment may be executed in one or more counterparts
and, if executed in more than one counterpart, the executed counterparts shall
each be deemed to be an original but all such counterparts shall together
constitute one and the same instrument.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the date first above written.

 

  DIGITAL TURBINE, INC.         By: /s/ Jeff Karish     Name: Jeff Karish    
Title: Director, Chairman, Compensation Committee         /s/ William Stone  
WILLIAM STONE

  

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Schedule A

 

a.Definitions:

 

i.Year 2 Period:  April 1, 2016 through March 31, 2017

 

ii.Year 3 Period:  April 1, 2017 through March 31, 2018

             

  iii. Adjusted EBITDA:  Adjusted EBITDA is as defined in the Employer’s 2017
“guidance EBITDA” as presented by management and approved by the Audit Committee
on 4/13/16 2016.

 

  iv. FY2017 Adjusted EBITDA Target:  Means the Employer’s Adjusted EBITDA
target for the fiscal year ending March 31, 2017 as approved by the Board on
4/13/16.  If the Employer completes an acquisition or disposition during the
Year 2 Period, then the FY2017 Adjusted EBITDA Target shall be adjusted by the
Compensation Committee, only after good faith discussion and consultation with
the Executive, to take into account the expected effects of such transaction on
the Employer’s FY2017 Adjusted EBITDA.

 

  v. FY2017 Revenue Target:  Means the Employer’s revenue target for the fiscal
year ending March 31, 2017 as approved by the Board on 4/13/16.  If the Employer
completes an acquisition or disposition during the Year 2 Period, then the
FY2017 Revenue Target shall be adjusted by the Compensation Committee, only
after good faith discussion and consultation with the Executive, to take into
account the expected effects of such transaction on the Employer’s FY2017
revenue.

 

  vi. Year 3 Period Targets: Means such annual revenue and Public Earnings
Measure (as defined below) targets for the Year 3 Period, established by the
Compensation Committee only after good faith discussion and consultation with
the Executive, with the expectation that the applicable targets for the Year 3
Period may be established within the initial 90 days of the Employer’s fiscal
year ending March 31, 2018.  If the Employer completes an acquisition or
disposition during Year 2 Period or Year 3 Period, then the applicable Year 2
Period or Year 3 Period Targets shall be adjusted by the Compensation Committee,
only after good faith discussion and consultation with the Executive, to take
into account the expected effects of such transaction on the Employer’s revenue
and Public Earnings Measure. “Public Earnings Measure” means the non-GAAP
measure of consolidated Employer earnings, such as EBITDA or an adjusted EBITDA
measure or such other publicly released earnings measure, that the Compensation
Committee determines (after good faith discussion, consultation with, and
notification to, the Executive) to be the most important earnings measure used
by the Employer in its public earnings release issued most recently prior to the
date by which the Year 3 Period Targets are to be determined.

 

  b. Bonus Criteria:

 

   

For the Year 2 Period, Executive shall receive 30% of Salary earned with respect
to the Year 2 Period, as a bonus if both the FY2017 Adjusted EBITDA Target and
the 2017 Revenue Target are achieved; plus up to an additional 70% of Salary
earned with respect to the Year 2 Period, as a bonus in the sole discretion of
the Compensation Committee based on extraordinary financial and business
performance of the Employer during the Year 2 Period (beyond the level required
to achieve the bonus of 30% of Salary for the Year 2 Period). The Compensation
Committee is also authorizing an additional 50% of base salary “Extraordinary
Bonus” if the Company exceeds targeted revenues and Adjusted EBITDA by 50%
relative to the targets approved by the Board for FY2017 at its meeting on
4/13/16.

 

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For the Year 3 Period, Executive shall receive 50% of Salary earned with respect
to the Year 3 Period, as a bonus if both of the Year 3 Period Targets are
achieved; plus up to an additional 50% of Salary earned with respect to the Year
3 Period, as a bonus in the sole discretion of the Compensation Committee based
on extraordinary financial and business performance of the Employer during the
Year 3 Period (beyond the level required to achieve the bonus of 50% of Salary
for the Year 3 Period). The Compensation Committee is also authorizing an
additional 50% of base salary “Extraordinary Bonus” if the Company exceeds
targeted revenues and Adjusted EBITDA by 50%.

 

Achievement of targets shall be determined promptly after the Employer’s annual
financial statements for the fiscal year for the applicable period have been
publicly issued and certified by the Employer’s auditors. Any interpretative
issues in reconciling Adjusted EBITDA or a Public Earnings Measure to audited
numbers shall (a) be resolved as much as possible based on the Employer’s
publicly filed reconciliations of the same and (b) as to any other questions
shall be determined in the reasonable discretion of the Compensation Committee
after good faith discussion with Executive.

 

Bonus targets that have not been achieved to the level required by this Schedule
A shall not entitle Executive to a pro-rated bonus.

 

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