Exhibit 10.1
Hipcricket, Inc.
 
Employment Agreement
 
This Employment Agreement (this “Agreement”), effective May 30, 2014 (the
“Effective Date”), is entered into by and between Hipcricket, Inc., a Delaware
corporation (the “Company”), and Todd Wilson (the “Employee”).
 
Certain capitalized terms in this Agreement have the meanings set forth in
Appendix A attached to this Agreement, which is incorporated into this Agreement
in its entirety.
 
WITNESSETH:
 
WHEREAS, the Company desires to employ Employee to serve as Interim Chief
Executive Officer, and Employee desires to be employed by the Company in such
capacity pursuant to the terms and conditions hereinafter set forth.
 
NOW, THEREFORE, in consideration of the foregoing and the mutual promises and
covenants herein contained, it is agreed as follows:
 
1.
EMPLOYMENT

 
1.1           Position; Duties and Responsibilities
 
The Company hereby employs Employee as Interim Chief Executive Officer of the
Company and Employee hereby agrees to accept employment by the Company as its
Interim Chief Executive Officer and report to the Company’s Board of Directors
(the “Board”).  Subject at all times to the direction of the Board, Employee
shall have direct responsibilities over operations, sales marketing, financial
accounting and SEC reporting, operational budgeting, sales costing analysis,
billing, and auditor interfacing.  Employee shall also perform such other
services and duties, as the Board shall determine, that relate to the business
of the Company and are reasonably consistent with Employee’s position.  Employee
shall serve, by mutual consent, in such other positions and offices of the
Company and its affiliates, if selected, without any additional
consideration.  The Company agrees that as long as the Company employs Employee,
the Company shall use its reasonable best efforts to cause Employee to be
elected as a member of the Board, including nomination of Employee for a new
three-year director term at the 2014 annual meeting of stockholders.
 
1.2           Full Time Employment
 
Employee hereby accepts employment by the Company, upon the terms and conditions
contained herein, and agrees that during the term of this Agreement, Employee
shall devote substantially all of his business time, attention, and energies to
the business of the Company.  Employee shall further spend at least seventy-five
percent (75%) of his full time business time at the Company’s Bellevue,
Washington location.  During the term of this Agreement, Employee shall not
perform any services for any other business entity, whether such entity conducts
a business that is competitive with the business of the Company or is engaged in
any other business activity; provided, however, that nothing herein contained
shall be construed as (a) preventing Employee from investing his personal assets
in any business or businesses which do not compete directly or indirectly with
the Company, provided such investment or investments do not require any services
on Employee’s part in the operation of the affairs of the entity in which such
investment is made and in which his participation is solely that of an investor,
(b) preventing Employee from purchasing securities in any corporation whose
securities are regularly traded, if such purchases shall not result in
Employee’s owning beneficially, at any time, more than five percent (5%) of the
equity securities of any corporation engaged in a business which is competitive,
directly or indirectly, to that of the Company, (c) preventing Employee from (i)
engaging in charitable activities, (ii) serving on corporate, advisory, civil or
charitable boards or committees, or (iii) delivering lectures, or teaching at
educational institutions, so long as such activities, individually or in
aggregate, do not adversely affect Employee’s performance of his duties
hereunder, which determination shall be made at the discretion of the Board, or
(d) engaging in any other activities, if Employee receives the prior written
approval of the Board with respect to his engaging in such
activities.  Notwithstanding the foregoing, it is hereby understood and agreed
that during the term of this Agreement, Employee shall be permitted to devote a
maximum of one (1) business day per calendar quarter in connection with
continued service on the board of directors of Brain Balance Holdings during the
term of this Agreement.   In signing this Agreement, Employee warrants that
Employee is available to perform his duties at the Company without restriction,
conflict of interest or breach of any contract or obligation Employee may have
entered into with a third party (such as a former employer).  Employee further
agrees to comply with the Company’s standard policies and procedures and with
all applicable laws and regulations.
 
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1.3           Records
 
In connection with Employee’s engagement hereunder, Employee shall accurately
maintain and preserve all notes and records generated by the Company which
relate to the Company and its business and shall make all such reports, written
if required, as the Company may reasonably require.
 
1.4           Term
 
Unless earlier terminated as provided in this Agreement, the term of this
Agreement shall begin on the Effective Date and shall end nine months thereafter
on February 28, 2015 (the “Term”).  Thereafter, the Company may elect to extend
employment to Employee for one or more additional periods mutually agreed upon
by the Company and Employee.
 
2.
COMPENSATION AND BENEFITS

 
As full compensation for the performance of Employee’s duties on behalf of the
Company, Employee shall be compensated as set forth below.  All payments made
pursuant to this Agreement shall be subject to withholding of all applicable
income, employment and other taxes.
 
2.1           Salary
 
Employee shall be paid an annual base salary (the “Base Salary”) of $350,000,
payable in semi-monthly installments in accordance with the payroll practices of
the Company (pro-rated for calendar year 2014 based on the number of days from
the Effective Date through December 31, 2014).   Notwithstanding the foregoing,
subject to Section 3, fifty percent (50%) of the Base Salary otherwise payable
to Employee during the first three (3) months of the Term shall be retained by
the Company and paid to Employee pro rata over the last six (6) months of the
Term (the “Retained Base Salary”).  
 
2.2           Bonus
 
In addition to the Base Salary, Employee shall be eligible to receive a target
bonus (“Bonus”) of fifty percent (50%) of Base Salary for fiscal year 2015,
based upon achievement of financial and other performance goals and objectives
mutually agreed upon by Employee and the Board.  The percentage of the
performance targets achieved, and any Bonus earned by Employee for fiscal year
2015, shall be determined in good faith by the Board (or an authorized committee
thereof).  Any Bonus earned by Employee shall be paid in fiscal year 2016 as
soon as reasonably practicable after approval by the Board (or an authorized
committee thereof), but in any event within sixty (60) days following the last
day of fiscal year 2015.  Except as otherwise provided in Section 3.3, Employee
must be employed with the Company as of the last day of the Term to be eligible
to receive the Bonus.
 
2.3           Stock Option Grant
 
As soon as practicable following execution of this Agreement, and subject to
Board approval, Employee shall be granted a stock option to purchase 6,865,257
shares of the Company’s common stock (the “Option”), the terms of which shall be
evidenced in a separate option agreement between Employee and the Company.  The
Option shall have a per share exercise price equal to the closing price of the
Company’s common stock on the date of Board approval and a maximum ten (10) year
term.  The Option shall vest in accordance with the following schedule:
 
(a)           2,288,419 shares subject to the Option shall vest and become
exercisable on February 28, 2015 (the “Time-Vested Option”);
 
(b)           2,288,419 shares subject to the Option shall vest and become
exercisable based on achievement of two (2) consecutive quarters of positive
adjusted EBITDA; and
 
 
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(c)           2,288,419 shares subject to the Option shall vest and become
exercisable based on achievement of fiscal year 2015 revenue and EBITDA targets
(the portions of the Option described in Sections 2.3(b) and (c) are
collectively referred to herein as the “Performance-Vested Option”).
 
The Option shall become fully vested and exercisable in the event of a Change of
Control (as defined in Appendix A).  Outstanding equity awards granted to
Employee prior to the Effective Date shall remain outstanding in accordance with
their terms and conditions and are not modified by this Agreement.
 
2.4           Business Expenses
 
The Company shall reimburse Employee for all reasonable business expenses
incurred by Employee in the performance of his duties hereunder during the Term
of this Agreement, including, but not limited to, expenses incurred for business
travel (including reasonable commuting expenses), attending technical and
business meetings, professional activities and customer entertainment, and an
apartment rental in Bellevue, Washington.  Such reimbursement shall be made in
accordance with regular Company policy and within a reasonable period following
Employee’s presentation of the details of, and proof of, such expenses.
 
2.5           Other Benefits
 
During the Term of this Agreement, the Company shall provide to Employee, at its
sole expense, health insurance and other benefits on the same terms and
conditions as it shall afford other senior management employees of the
Company.  Employee shall be eligible for three (3) weeks of paid vacation during
the Term and also shall be provided such holidays as the Company makes available
to all of its other employees.
 
3.
TERMINATION

 
 
3.1
Employment At Will

 
Employee acknowledges and understands that employment with the Company is at
will and can be terminated by either party for no reason or for any reason not
otherwise specifically prohibited by law.  Nothing in this Agreement is intended
to alter Employee’s at-will employment status or obligate the Company to
continue to employ Employee for any specific period of time, or in any specific
role or geographic location.  Except as expressly provided for in this
Agreement, upon any termination of employment, Employee shall not be entitled to
receive any payments or benefits under this Agreement other than unpaid Base
Salary earned through the date of termination (including any Retained Base
Salary) and unused vacation that has accrued as of the date of Employee’s
termination of employment that would be payable to Employee under the Company’s
standard policy (collectively, the “Accrued Obligations”).  In addition, upon
termination of employment of Employee for any reason (including any termination
to which Sections 3.2 and 3.3 of this Agreement apply), any then unvested
Performance-Vested Option shall remain outstanding until such time as the Board
(or an authorized committee thereof) determines if, and to what extent, the
Performance-Vested Option shall become vested and exercisable.  In the event the
Board (or an authorized committee thereof) determines that all or a portion of
the Performance-Vested Option shall not become vested, the Performance-Vested
Option (or an applicable portion thereof) shall expire automatically as to such
portion for which the performance goals have not been satisfied and such
Performance-Vested Option (or an applicable portion thereof) shall no longer be
exercisable as of such determination date, and Employee shall have no further
right or interest under the Performance-Vested Option (or an applicable portion
thereof).
 
 
3.2
Automatic Termination on Disability or Death

 
This Agreement and Employee’s employment hereunder shall be terminated
automatically upon Employee’s Disability (as defined in Appendix A) or
Employee’s death.  If Employee’s employment is terminated due to such Disability
or death, the Company will be required to pay to Employee or Employee’s estate,
as the case may be, unrelated to any amounts that Employee may be eligible to
receive pursuant to the Company’s short-term and long-term disability plans or
life insurance plans (as applicable), the Accrued Obligations.  Employee or
Employee’s estate, as the case may be, will not by operation of this provision
forfeit any rights in which Employee is vested as the time of Employee’s
Disability or death, including pursuant to the terms of any equity awards
granted to Employee and outstanding at the effective date of the termination of
this Agreement.
 
 
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3.3
Termination of Employment Without Cause or for Good Reason

 
(a)           Subject to Section 3.3(b), if during the Term, (i) the Company
terminates Employee’s employment without Cause (as defined in Appendix A) or
(ii) Employee resigns for Good Reason (as defined in Appendix A), then Employee
shall be entitled to receive the following termination payments and benefits;
provided, however, that this Section 3.3 shall not apply to, and shall have no
effect in connection with, any termination to which Section 3.2 of this
Agreement applies:
 
(1)           payment of Base Salary for a period equal to the greater of (x)
three (3) months and (y) the remainder of the Term, whichever the case may be
(as applicable, the “Continuation Period”), such amount payable to Employee at
the rate in effect immediately prior to termination (or, if Employee terminates
employment for Good Reason due to a material reduction in Employee’s
then-in-effect base salary, immediately prior to such reduction) in
approximately equal installments through the Company’s regularly scheduled
payroll during the Continuation Period;
 
(2)           full acceleration of vesting of the Time-Vested Option;
 
(3)           an amount equal to Employee’s target Bonus, pro-rated for the
number of full months worked during the Term prior to termination of employment
and payable to Employee in approximately equal installments through the
Company’s regularly scheduled payroll during the Continuation Period;
 
(4)           if Employee and his spouse and eligible children are entitled to,
and timely (and properly) elect to, continue their coverage (or the coverage of
any one of them) under the Company’s group health plans pursuant to Section
4980B of the Code (“COBRA”), Company-paid premiums (or reimbursement to Employee
for any premiums paid by Employee (or Employee’s spouse or eligible children))
for such COBRA continuation coverage for a period equal to the Continuation
Period, beginning on the last day of the month containing Employee’s date of
termination (“COBRA Continuation Date”) or until Employee is no longer entitled
to COBRA continuation coverage under the Company’s group health plans, whichever
period is shorter.  Notwithstanding the foregoing or any other provision of this
Agreement to the contrary, the Company may unilaterally amend this Section
3.3(a)(4) or eliminate the benefit provided hereunder to the extent it deems
necessary to avoid the imposition of excise taxes, penalties or similar charges
on the Company or any of its subsidiaries or affiliates, including, without
limitation, under Section 4980D of the Code (the payments and benefits set forth
in Section 3.3(a)(1)-(4) are collectively referred to herein as “Severance
Payments”); and
 
(5)           the Accrued Obligations, payable in a lump sum on the next
regularly scheduled payroll date following the date on which Employee’s
employment terminated.
 
(b)           As a condition to receiving the payments and benefits under this
Section 3.3, other than the Accrued Obligations, Employee must timely execute
(and not revoke within the applicable revocation period specified therein) a
general release and waiver of all claims against the Company, which release and
waiver shall be in a form acceptable to the Company (the “Release”).  To be
timely, the Release must become effective (i.e., Employee must have executed the
Release and any revocation period must have expired without Employee’s revoking
the Release) no later than sixty (60) days (or such earlier date specified in
the Release) after Employee’s date of termination (the “Release Deadline”).  If
the Release does not become effective and irrevocable by the Release Deadline,
Employee will not have any right or entitlement to any of the Severance Payments
described in this Section 3.3.  Severance Payments shall begin on the first
regularly scheduled payroll date following the date on which the Employee’s
Release becomes effective.  Such initial installment shall include all Severance
Payments that would have been made prior to such date, but for the obligation to
execute a Release, with all remaining Severance Payments to be paid in
accordance with the Company’s payroll policies.  Notwithstanding the foregoing,
if the maximum period during which Employee can consider and revoke the Release
begins in one calendar year and ends in the subsequent calendar year, then the
initial installment of Severance Payments shall not be made until the first
regularly scheduled payroll date occurring after the later of (i) the date
Employee’s Release becomes effective and (ii) the first day of the subsequent
calendar year.  Payment of the amounts and benefits under this Section 3.3 are
contingent on Employee’s full and continued compliance with the provisions of
Section 4.
 
 
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4.
INVENTIONS; CONFIDENTIAL INFORMATION AND TRADE SECRETS; NON-SOLICITATION OF
EMPLOYEES; AND OTHER EMPLOYEE COVENANTS

 
For the purposes of this Agreement, all references to business products,
services and sales of the Company shall include those of the Company's
affiliates.
 
4.1                      Inventions
 
(a)           All systems, inventions, discoveries, apparatus, techniques,
methods, know-how, formulae or improvements made, developed or conceived by
Employee during Employee’s employment by the Company, whenever or wherever made,
developed or conceived, and whether or not during business hours, which
constitute an improvement, on those heretofore, now or at any time during
Employee’s employment, developed, manufactured or used by the Company in
connection with the manufacture, process or marketing of any product heretofore
or now or hereafter developed or distributed by the Company, or any services to
be performed by the Company or of any product which shall or could reasonably be
manufactured or developed or marketed in the reasonable expansion of the
Company’s business, shall be and continue to remain the Company’s exclusive
property, without any added compensation or any reimbursement for expenses to
Employee, and upon the conception of any and every such invention, process,
discovery or improvement and without waiting to perfect or complete it, Employee
promises and agrees that Employee will immediately disclose it to the Company
and to no one else and thenceforth will treat it as the property and secret of
the Company.
 
(b)           Employee will also execute any instruments requested from time to
time by the Company to vest in it complete title and ownership to such
invention, discovery or improvement and will, at the request of the Company, do
such acts and execute such instruments as the Company may require, but at the
Company’s expense to obtain Letters of Patent, trademarks or copyrights in the
United States and foreign countries, for such invention, discovery or
improvement and for the purpose of vesting title thereto in the Company, all
without any reimbursement for expenses (except as provided in Section 2.4 or
otherwise) and without any additional compensation of any kind to Employee.
 
(c)           Any assignment of inventions required by this Agreement does not
apply to an invention for which no equipment, supplies, facility, intellectual
property or trade secret information of the Company was used and which was
developed entirely on the Employee’s own time, unless (i) the invention relates
(x) directly to the business of the Company or (y) to the Company’s actual or
demonstrably anticipated research or development or (ii) the invention results
from any work performed by Employee for the Company.
 
4.2           Confidential Information and Trade Secrets
 
(a)           All Confidential Information (as defined in Appendix A) shall be
the sole property of the Company.  Employee shall not, during the period of his
employment and for a period ending two (2) years after termination of his
employment for any reason, disclose to any person or entity or use or
otherwise exploit for Employee’s own benefit or for the benefit of any other
person or entity any Confidential Information which is disclosed to Employee or
which becomes known to Employee in the course of his employment with the Company
without the prior written consent of an officer of the Company except as may be
necessary and appropriate in the ordinary course of performing his duties to the
Company during the period of his employment with the Company.
 
(b)           All Trade Secrets (as defined in Appendix A) shall be the sole
property of the Company.  Employee agrees that during his employment with the
Company and after his termination, Employee will keep in confidence and trust
and will not use or disclose any Trade Secrets or anything relating to any Trade
Secrets, or deliver any Trade Secrets, to any person or entity outside the
Company without the prior written consent of the Board.
 
 
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4.3           Non-Solicitation of Employees
 
During the term of Employee’s employment and for one (1) year thereafter,
Employee will not cause or attempt to cause any employee of the Company to cease
working for the Company.  However, this obligation shall not affect any
responsibility Employee may have as an employee of the Company with respect to
the bona fide hiring and firing of the Company’s personnel.
 
4.4           Non-Solicitation of Customers and Prospective Customers
 
During the term of Employee’s employment and for one (1) year thereafter,
Employee will not, directly or indirectly, solicit the business of any customer
for the purpose of, or with the intention of, selling or providing to such
customer any product or service in competition with any product or service sold
or provided by the Company during the twelve (12) months immediately preceding
the termination of Employee’s employment with the Company.
 
4.5           Non-Competition
 
Employee agrees that during his employment with the Company and for one (1) year
thereafter, Employee will not engage in any employment, business, or activity
that is in any way competitive with the business or proposed business of the
Company, and Employee will not assist any other person or organization in
competing with the Company or in preparing to engage in competition with the
business or proposed business of the Company.  The provisions of this Section
4.5 shall apply both during normal working hours and at all other times,
including, without limitation, nights, weekends and vacation time, while
Employee is employed with the Company.
 
5.           INJUNCTION
 
(a)           Should Employee at any time reveal, or threaten to reveal, any
Confidential Information or Trade Secrets of the Company, or during any
restricted period engage, or threaten to engage, in any business in competition
with that of the Company, or perform, or threaten to perform, any services for
anyone engaged in such competitive business, or in any way violate, or threaten
to violate, any of the provisions of this Agreement, the Company shall be
entitled to an injunction restraining Employee from doing, or continuing to do,
or performing any such acts, and Employee hereby consents to the issuance of
such an injunction without any requirement that the Company post a bond.
 
(b)           In the event that a proceeding is brought in equity to enforce the
provisions of this Section 5, Employee shall not argue as defense that there is
an adequate remedy at law, nor shall the Company be prevented from seeking any
other remedies which may be available.
 
(c)           The existence of any claim or cause of action by the Company
against Employee, or by Employee against the Company, whether predicated upon
this Agreement or otherwise, shall not constitute a defense to the enforcement
by the Company of the foregoing restrictive covenants but shall be litigated
separately.
 
6.           ARBITRATION
 
(a)           Except as provided in Section 5 above, in the event that there
shall be a dispute (a “Dispute”) among the parties arising out of or relating to
this Agreement, or the breach thereof, the parties agree that such Dispute shall
be resolved by final and binding arbitration before a single arbitrator in the
metropolitan area in which the Employee was primarily performing services at the
time the Dispute arose, administered by the American Arbitration Association
(the “AAA”), in accordance with AAA’s Employment ADR Rules.  The arbitrator’s
decision shall be final and binding upon the parties, and may be entered and
enforced in any court of competent jurisdiction by either of the parties.  The
arbitrator shall have the power to grant temporary, preliminary and permanent
relief, including without limitation, injunctive relief and specific
performance.
 
(b)           The Company shall pay the direct costs and expenses of the
arbitration, including arbitration and arbitrator fees.  Except as otherwise
provided by statute, Employee and the Company are responsible for their
respective attorneys’ fees incurred in connection with enforcing this
Agreement.  Employee and the Company agree that, to the extent  permitted by
law, the arbitrator may, in his or her discretion, award reasonable attorneys’
fees to the prevailing party.

 
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7.
SECTION 409A COMPLIANCE

 
The parties intend that this Agreement and the payments and benefits provided
hereunder be exempt from the requirements of Section 409A of the Code (“Section
409A”), to the maximum extent possible, whether pursuant to the short-term
deferral exception described in Treas. Reg. Section 1.409A-1(b)(4), the
involuntary separation pay plan exception described in Treas. Reg. Section
1.409A-1(b)(9)(iii), or otherwise.  To the extent Section 409A is applicable to
this Agreement, the parties intend that this Agreement and any payments and
benefits thereunder comply with the deferral, payout and other limitations and
restrictions imposed under Section 409A.  Notwithstanding anything herein to the
contrary, this Agreement shall be interpreted, operated and administered in a
manner consistent with such intentions; provided, however, that in no event
shall the Company or any of its subsidiaries or affiliates (or any of their
successors) be liable for any additional tax, interest or penalty that may be
imposed on Employee pursuant to Section 409A or for any damages incurred by
Employee as a result of this Agreement (or the payments or benefits hereunder)
failing to comply with, or be exempt from, Section 409A.  Without limiting the
generality of the foregoing, and notwithstanding any other provision of this
Agreement to the contrary:
 
(a)           to the extent Section 409A is applicable to this Agreement, a
termination of employment shall not be deemed to have occurred for purposes of
any provision of this Agreement providing for the payment of amounts or benefits
upon or following a termination of employment unless such termination is also a
“separation from service,” as defined in Treas. Reg. Section 1.409A-1(h), after
giving effect to the presumptions contained therein (and without regard to the
optional alternative definitions available therein), and, for purposes of any
such provision of this Agreement, references to “terminate,” “termination,”
“termination of employment,” “resigns” and like terms shall mean separation from
service;
 
(b)           if, at the time Employee separates from service, Employee is a
“specified employee” within the meaning of Section 409A, then to the extent
necessary to avoid subjecting Employee to the imposition of any additional tax
or interest under Section 409A, amounts that would (but for this provision) be
payable within six months following the date of Employee’s separation from
service shall not be paid to Employee during such period, but shall instead be
paid in a lump sum on the first business day of the seventh month following the
date of Employee’s separation from service or, if earlier, upon the Employee’s
death;
 
(c)           each payment made under this Agreement shall be treated as a
separate payment and the right to a series of installment payments under this
Agreement shall be treated as a right to a series of separate and distinct
payments; and
 
(d)           with regard to any provision in this Agreement that provides for
reimbursement of expenses or in-kind benefits, except for any expense,
reimbursement or in-kind benefit provided pursuant to this Agreement that does
not constitute a “deferral of compensation, ” within the meaning of Treasury
Regulation Section 1.409A-1(b), (i) the amount of expenses eligible for
reimbursement, or in-kind benefits provided, during any calendar year shall not
affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other calendar year, (ii) such reimbursements shall be made on
or before the last day of the calendar year following the calendar year in which
the expense was incurred, and (iii) the right to reimbursement or in-kind
benefits shall not be subject to liquidation or exchange for another benefit.

 
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8.           LIMITATIONS ON PAYMENTS UNDER CERTAIN CIRCUMSTANCES
 
(a)           Notwithstanding any other provision under this Agreement, in the
event that Employee becomes entitled to receive or receives any payment under
this Agreement or any payments or benefits under any other plan, agreement,
program or arrangement with the Company or any entity that is directly or
indirectly controlled by, in control of or under common control with the Company
(collectively, the “Payments”), that may separately or in the aggregate
constitute “parachute payments” within the meaning of Section 280G of the Code
and the Treasury regulations promulgated thereunder (“Section 280G”) and it is
determined that, but for this Section 8, any of the Payments will be subject to
any excise tax pursuant to Section 4999 of the Code or any similar or successor
provision (the “Excise Tax”), the Company shall pay to Employee either (i) the
full amount of the Payments or (ii) an amount equal to the Payments reduced by
the minimum amount necessary to prevent any portion of the Payments from being
an “excess parachute payment” (within the meaning of Section 280G) (the “Capped
Payments”), whichever of the foregoing amounts results in the receipt by
Employee, on an after-tax basis (with consideration of all taxes incurred in
connection with the Payments, including the Excise Tax), of the greatest amount
of Payments notwithstanding that all or some portion of the Payments may be
subject to the Excise Tax.  For purposes of determining whether Employee would
receive a greater after-tax benefit from the Capped Payments than from receipt
of the full amount of the Payments and for purposes of Section 8(c) below (if
applicable), Employee shall be deemed to pay federal, state and local taxes at
the highest marginal rate of taxation for the applicable calendar year.
 
(b)           All computations and determinations called for by Sections 8(a)
and 8(c) shall be made and reported in writing to the Company and Employee by a
third-party service provider selected by the Company (the “Tax Advisor”), and
all such computations and determinations shall be conclusive and binding on the
Company and Employee.  For purposes of such calculations and determinations, the
Tax Advisor may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code.  The Company and Employee
shall furnish to the Tax Advisor such information and documents as the Tax
Advisor may reasonably request in order to make its required calculations and
determinations.  The Company shall bear all fees and expenses charged by the Tax
Advisor in connection with its services.
 
(c)           In the event that Section 8(a) applies and a reduction is required
to be applied to the Payments thereunder, the Payments shall be reduced by the
Company in a manner and order of priority that provides Employee with the
largest net after-tax value; provided that payments of equal after-tax present
value shall be reduced in the reverse order of payment.  Notwithstanding
anything to the contrary herein, any such reduction shall be structured in a
manner intended to comply with Section 409A of the Code.
 
9.           MISCELLANEOUS
 
9.1           Assignment
 
The rights, benefits, duties and obligations under this Agreement shall inure
to, and be binding upon, the Company, its successors and assigns, and upon
Employee and his legal representatives, heirs and legatees.  This Agreement
constitutes a personal service agreement, and the performance of Employee’s
obligations hereunder may not be transferred or assigned by Employee.
 
9.2                      Amendments in Writing
 
No amendment, modification, waiver, termination or discharge of any provision of
this Agreement, or consent to any departure therefrom by either party hereto,
shall in any event be effective unless the same shall be in writing,
specifically identifying this Agreement and the provision intended to be
amended, modified, waived, terminated or discharged and signed by the Company
and Employee, and each such amendment, modification, waiver, termination or
discharge shall be effective only in the specific instance and for the specific
purpose for which given.  No provision of this Agreement shall be varied,
contradicted or explained by any oral agreement, course of dealing or
performance or any other matter not set forth in an agreement in writing and
signed by the Company and Employee.
 
 
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9.3           Notices
 
Every notice relating to this Agreement shall be in writing and must be either
personally delivered, mailed by first class mail (postage prepaid and return
receipt requested), sent by reputable overnight courier (charges prepaid), or
sent by confirmed email as set forth below (or to such other person or address,
fax number or email address as a party may designate by written notice to the
other parties in accordance with the provisions of this Section 9.3):
 
 
If to the Company:
Hipcricket, Inc.

 
110 110th Avenue NE, Suite 410

 
Bellevue, Washington 98004

 
Attn:  Board of Directors

 
Email:  legal@hipcricket.com

 
 
If to Employee:
Information on record at the Company

 
 
9.4
Entire Agreement

 
The parties hereto have made no agreements, representations or warranties
relating to the subject matter of this Agreement that are not set forth
herein.  This Agreement, on and as of the Effective Date, constitutes the entire
agreement between the Company and Employee with respect to the subject matter
hereof, and all prior or contemporaneous oral or written communications,
understandings or agreements between the Company and Employee with respect to
such subject matter are hereby superseded in their entirety, except as otherwise
provided herein.
 
 
9.5
Severability

 
If any provision of this Agreement shall be declared, by a court of competent
jurisdiction, to be invalid, illegal or incapable of being enforced in whole or
in part, the remaining conditions and provisions or portions thereof shall
nevertheless remain in full force and effect and enforceable to the extent they
are valid, legal and enforceable, and no provision shall be deemed dependent
upon any covenant or provision so expressed herein.
 
 
9.6
Waivers

 
The failure of either party to insist upon the strict performance of any of the
terms, conditions and provisions of this Agreement shall not be construed as a
waiver or relinquishment of future compliance therewith, and said terms,
conditions and provisions shall remain in full force and effect.  No waiver of
any term or condition of this Agreement, on the part of either party, shall be
effective for any purpose whatsoever unless such waiver is in writing and signed
by such party.
 
 
9.7
Headings

 
All headings used herein are for convenience only and shall not in any way
affect the construction of, or be taken into consideration in interpreting, this
Agreement.
 
 
9.8
Applicable Law

 
This Agreement shall in all respects, including all matters of construction,
validity and performance, be governed by, and construed and enforced in
accordance with, the internal laws of the State of Delaware, without regard to
any rules governing conflicts of laws.
 
 
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9.9
Counterparts

 
This Agreement, and any amendment or modification entered into pursuant to
Section 9.2  hereof, may be executed in any number of counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute one and
the same instrument.
 
IN WITNESS WHEREOF, the parties have executed and entered into this Agreement
effective on the date first set forth above.
 
EMPLOYEE
 
/s/ Todd Wilson                                                                
Todd Wilson
 
 
HIPCRICKET, INC.
 
By   /s/ Michael
Brochu                                                                
Michael Brochu, Compensation Committee Chair
 
 
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Appendix A
 
Definitions

Capitalized terms used below that are not defined in this Appendix A have the
meanings set forth in the Employment Agreement (“Agreement”) to which this
Appendix A is attached.  As used in the Agreement:
 
1.           “Cause” means (a) Employee’s material fraud, gross malfeasance,
gross negligence, or willful misconduct done in bad faith, with respect to the
Company’s business affairs; (b) Employee’s refusal or repeated failure to follow
the Company’s established reasonable and lawful policies; (c) Employee’s
material breach of this Agreement; or (d) Employee’s conviction of a felony or
crime involving moral turpitude.  A termination of Employee for Cause based on
clauses (a), (b) or (c) of the preceding sentence shall take effect thirty (30)
days after the Company gives written notice of its intent to terminate
Employee’s employment and the Company’s description of the alleged cause, unless
Employee, in the good-faith opinion of the Company, during such thirty (30) day
period, remedies the events or circumstances constituting Cause.
 
2.           “Change in Control” has the meaning set forth in the Company’s 2014
Equity Incentive Plan, as the same may be amended from time to time.
 
3.           “Code” means the Internal Revenue Code of 1986, as amended.
 
4.            “Confidential Information” shall mean any data or information
belonging to the Company, other than Trade Secrets, that is of value to the
Company and is not generally known to competitors of the Company or to the
public, and is maintained confidential by the Company, including but not limited
to non-public information about the Company’s clients, executives, key
contractors and other contractors and information with respect to its products,
designs, services, strategies, pricing, processes, procedures, research,
development, inventions, improvements, purchasing, accounting, engineering and
marketing (including any discussions or negotiations with any third
parties).  Notwithstanding the foregoing, no information will be deemed to be
Confidential Information unless such information is treated by the Company as
confidential and shall not include any data or information of the Company that
has been voluntarily disclosed to the public by the Company (except where such
public disclosure has been made without the authorization of the Company), or
that has been independently developed and disclosed by others, or that otherwise
enters the public domain through lawful means.
 
5.            “Disability” means Employee’s inability, due to physical or mental
ill health, to perform the essential functions of Employee’s job, with or
without a reasonable accommodation, for a period in excess of 120 consecutive
days or in excess of 180 days in any consecutive twelve (12) month period.  In
the event of any dispute regarding Disability under Section 3.2, Employee shall
submit to a physical and/or psychological examination by a licensed physician
mutually satisfactory to the Company and Employee, the cost of such examination
to be paid by the Company, and the determination of such physician shall be
determinative.
 
6.           “Good Reason” means any of the following without Employee’s written
consent: (a) a material reduction in Employee’s base compensation; (b) a
material reduction in Employee’s authority, duties and responsibilities as in
effect on the Effective Date; or (c) a change in the Employee’s place of work to
a location more than fifty (50) miles from the place of work on the Effective
Date, except for required travel on Company business to an extent substantially
consistent with the Participant’s position, duties and
responsibilities.  Notwithstanding any provision of this Agreement to the
contrary, a termination of an employment relationship by Employee will not be
for Good Reason unless (i) Employee notifies the Company in writing of the
existence of the condition that Employee believes constitutes Good Reason within
ninety (90) days of the initial existence of such condition (which notice
specifically identifies such condition), (ii) the Company fails to remedy such
condition within thirty (30) days after the date that it receives such notice
(the “Remedial Period”), and (iii) Employee actually terminates his employment
within thirty (30) days after the expiration of the Remedial Period.  If
Employee terminates his employment before expiration of the Remedial Period or
after the Company remedies the condition, then Employee’s termination will not
be for Good Reason.
 
 
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7.           “Trade Secrets” shall mean any scientific, technical and
non-technical data, information, formula, pattern, compilation, program, device,
method, technique, drawing, process, financial data, financial plan, product
plan or list of actual or potential customers or vendors and suppliers of the
Company or any portion or part thereof, whether or not copyrightable or
patentable, that is of value to the Company and is not generally known to
competitors of the Company or to the public, and whose confidentiality is
maintained, including unpatented and un-copyrighted information relating to the
Company’s products, information concerning proposed new products or services,
market feasibility studies, proposed or existing marketing techniques or plans
and customer consumption data, usage or load data, and any other information
that constitutes a trade secret, as such term as defined under Delaware law, in
each case to the extent that the Company, as the context requires, derives
economic value, actual or potential, from such information not being generally
known to, and not being readily ascertainable by proper means by, other persons
or entities who can obtain economic value from its disclosure or use.