Exhibit 10.14

 

June 27, 2005

 

Matt Wisk

3506 Waverly

Palo Alto, California 34306

 

Dear Matt,

 

This letter sets forth the terms and conditions of your employment with United
Online, Inc. (the “Company”).

 

1.             POSITION.  YOU WILL SERVE IN A FULL-TIME CAPACITY AS EXECUTIVE
VICE PRESIDENT, CHIEF MARKETING OFFICER OF THE COMPANY.  YOUR EMPLOYMENT WITH
THE COMPANY WILL COMMENCE ON A DATE (THE “COMMENCEMENT DATE”) TO BE DETERMINED
BY YOU, WHICH COMMENCEMENT DATE WILL BE NO LATER THAN AUGUST 5, 2005.  YOU WILL
REPORT TO THE CHIEF EXECUTIVE OFFICER OF THE COMPANY.

 

2.             SALARY AND BENEFITS.  YOU WILL BE PAID A SALARY AT THE ANNUAL
RATE OF $350,000, PAYABLE IN BI-WEEKLY INSTALLMENTS IN ACCORDANCE WITH THE
COMPANY’S STANDARD PAYROLL PRACTICES, SUBJECT TO ANY INCREASES AS DETERMINED BY
THE BOARD OF DIRECTORS OF THE COMPANY (THE “BOARD OF DIRECTORS”) FROM TIME TO
TIME.  YOU WILL BE ELIGIBLE TO PARTICIPATE IN THE COMPANY’S EMPLOYEE BENEFITS
PLANS, INCLUDING ITS 401(K) PLAN.  IN ADDITION, YOU WILL BE ENTITLED TO
PARTICIPATE IN THE COMPANY’S EXEC-U-CARE MEDICAL REIMBURSEMENT INSURANCE PLAN SO
LONG AS SUCH PLAN IS MADE GENERALLY AVAILABLE TO THE COMPANY’S SENIOR
EXECUTIVES.  YOU WILL BE ENTITLED TO 4 WEEKS OF PAID VACATION EACH YEAR,
PURSUANT TO THE COMPANY’S STANDARD VACATION POLICY.

 

3.             BONUS.

 

A.             SIGNING BONUS.  WITHIN SEVEN (7) DAYS FOLLOWING THE COMMENCEMENT
DATE, YOU WILL RECEIVE A SIGNING BONUS (THE “SIGNING BONUS”) IN AN AMOUNT EQUAL
TO THE SUM OF (I) THE AMOUNT OF THE SIGNING BONUS YOU FORFEITED UPON TERMINATION
OF YOUR EMPLOYMENT WITH TIVO (UP TO A MAXIMUM OF $100,000 AND SUBJECT TO THE
COMPANY’S RECEIPT OF VERIFICATION THEREOF), AND (II) THE VALUE OF THE 75,000
UNVESTED STOCK OPTIONS YOU FORFEITED UPON TERMINATION OF YOUR EMPLOYMENT WITH
TIVO (ASSUMED TO BE VALUED AT $201,750); PROVIDED, HOWEVER, THAT THE SIGNING
BONUS WILL IN NO EVENT EQUAL LESS THAN $150,000.  IN THE EVENT YOUR EMPLOYMENT
WITH THE COMPANY IS TERMINATED PRIOR TO THE ONE (1)-YEAR ANNIVERSARY OF THE
COMMENCEMENT DATE (I) BY THE COMPANY “FOR CAUSE” (AS DEFINED BELOW) OR (II) BY
YOU OTHER THAN AS A RESULT OF DEATH, “DISABILITY” OR FOR “GOOD REASON” (EACH
TERM AS DEFINED BELOW), YOU WILL PAY THE COMPANY THE FULL AMOUNT OF THE SIGNING
BONUS WITHIN FOURTEEN (14) DAYS FOLLOWING THE DATE OF TERMINATION.

 

B.             ANNUAL BONUS.  FOR FISCAL YEAR 2005, YOU WILL RECEIVE A BONUS
EQUAL TO $150,000, PAYABLE NO LATER THAN MARCH 31, 2006, CONCURRENTLY WITH THE
COMPANY’S PAYMENT OF FISCAL YEAR 2005 BONUSES TO ITS OTHER EXECUTIVE OFFICERS,
PROVIDED THAT YOU CONTINUE TO BE EMPLOYED BY THE COMPANY WHEN SUCH BONUSES ARE
PAID.  FOR FISCAL YEAR 2006, YOU WILL BE ELIGIBLE TO PARTICIPATE IN A BONUS
PROGRAM WITH ELIGIBILITY FOR UP TO 100% OF YOUR ANNUAL BASE SALARY.  THE
CRITERIA FOR A BONUS IN FISCAL YEAR 2006 AND THE AMOUNT OF SUCH BONUS WILL BE
DETERMINED BY THE BOARD OF DIRECTORS OR A COMMITTEE THEREOF.

 

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4.             STOCK OPTIONS; RESTRICTED STOCK UNITS.

 

a.             Stock Options.  On or about the Commencement Date, you will be
granted an option to purchase 150,000 shares of the Company’s common stock (the
“Option”) with an exercise price equal to the fair market value of the common
stock on the date of grant.  The Option will be subject to the standard terms
and conditions of the applicable stock plan and the stock option agreement
between you and the Company (copies of which have been provided to you) and the
following four (4)-year vesting schedule based on your continued employment with
the Company: 25% of the Option will vest on the one (1)-year anniversary of the
Commencement Date and, thereafter, the remaining 75% will vest in equal monthly
installments such that 100% will have vested by the four (4)-year anniversary of
the Commencement Date.

 

b.             Restricted Stock Units.  On or about the Commencement Date, you
will be awarded restricted stock units covering 100,000 shares of the Company’s
common stock (the “Restricted Stock Units”).  The Restricted Stock Units will be
subject to the standard terms and conditions set forth in the applicable stock
plan and the restricted stock unit agreement between you and the Company (copies
of which have been provided to you) and the following four (4)-year vesting
schedule based on your continued employment with the Company: 25% of the
underlying shares of the Company’s common stock will vest on each one (1)-year
anniversary of the Commencement Date such that 100% will have vested by the four
(4)-year anniversary of the Commencement Date.  As more fully addressed in the
restricted stock unit agreement, outstanding restricted stock units are entitled
to receive regularly-scheduled cash dividends the Company declares on its common
stock.  Dividends paid on Restricted Stock Units are treated as ordinary income
for tax purposes.

 

c.             Acceleration of Vesting.  Upon the termination of your employment
by the Company “without cause” or by you for “good reason” (each term as defined
below) within the two (2)-year period following the Commencement Date, the
vesting of the Option and the Restricted Stock Units will be accelerated by the
additional number of shares in which you would have been vested at the time of
such termination if you had completed an additional twelve (12) months of
service (calculated, with respect the Restricted Stock Units, as if such Units
vest on a monthly basis).  If such termination occurs within twelve (12) months
after a “Corporate Transaction” or “Change in Control” (as defined in the
applicable stock plan and restricted stock unit agreement), the vesting will be
accelerated by the greater of (i) the additional number of shares as calculated
pursuant to the preceding sentence and (ii)  the additional number of shares in
which you would have been vested at the time of such termination if you had
completed an additional period of service equal in duration to the actual period
of service completed by you between the Commencement Date and the date of the
termination (calculated, with respect the Restricted Stock Units, as if such
Units vest on a monthly basis).  Such vesting acceleration will be contingent
upon your signing the standard release of claims referred to in Section 7(b)
below.  Upon the termination of your employment as a result of death or
Disability (as defined below) within the two (2)-year period following the
Commencement Date, the vesting of the Option and the Restricted Stock Units will
be accelerated by the additional number of shares in which you would have been
vested at the time of such termination if you had completed an additional twelve
(12) months of service (calculated, with respect the Restricted Stock Units, as
if such Units vest on a monthly basis).  In the event of an inconsistency
between the terms set forth in this paragraph and the terms set forth in the
applicable stock plan, stock option agreement and/or restricted stock unit
agreement, the terms set forth in this letter will control.

 

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5.             POLICIES; PROCEDURES; PROPRIETARY INFORMATION AND INVENTIONS
AGREEMENT.  AS AN EMPLOYEE OF THE COMPANY, YOU WILL BE EXPECTED TO ABIDE BY ALL
OF THE COMPANY’S POLICIES AND PROCEDURES.  AS A CONDITION OF YOUR EMPLOYMENT,
YOU AGREE TO EXECUTE AND ABIDE BY THE TERMS OF THE PROPRIETARY INFORMATION AND
INVENTIONS AGREEMENT BETWEEN YOU AND THE COMPANY, THE INSIDER TRADING POLICY,
THE CODE OF ETHICS AND THE EMPLOYEE HANDBOOK.

 

6.             AT WILL EMPLOYMENT.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED HEREIN, YOUR EMPLOYMENT WITH THE COMPANY WILL BE “AT WILL” AND WILL
NOT BE FOR ANY SPECIFIED TERM, MEANING THAT EITHER YOU OR THE COMPANY WILL BE
ENTITLED TO TERMINATE YOUR EMPLOYMENT AT ANY TIME AND FOR ANY REASON, WITH OR
WITHOUT CAUSE.  ANY CONTRARY REPRESENTATIONS WHICH MAY HAVE BEEN MADE TO YOU ARE
SUPERSEDED BY THE TERMS SET FORTH IN THIS PARAGRAPH.  THIS IS THE FULL AND
COMPLETE AGREEMENT BETWEEN YOU AND THE COMPANY ON THIS SUBJECT.  ALTHOUGH YOUR
JOB DUTIES, TITLE, COMPENSATION AND BENEFITS, AS WELL AS THE COMPANY’S PERSONNEL
POLICIES AND PROCEDURES, MAY CHANGE FROM TIME TO TIME, THE “AT WILL” NATURE OF
YOUR EMPLOYMENT MAY ONLY BE CHANGED IN AN EXPRESS WRITTEN AGREEMENT SIGNED BY
YOU AND A DULY AUTHORIZED OFFICER OF THE COMPANY.

 

7.             TERMINATION OF EMPLOYMENT

 

A.             TERMINATION BY YOU.  IF YOU TERMINATE YOUR EMPLOYMENT WITH THE
COMPANY FOR ANY REASON, OTHER THAN AS A RESULT OF DEATH OR DISABILITY OR FOR
“GOOD REASON” AS DEFINED BELOW, ALL OBLIGATIONS OF THE COMPANY AS SET FORTH IN
THIS LETTER WILL CEASE, OTHER THAN THE OBLIGATION TO PAY YOU FOR SERVICES
RENDERED THROUGH THE DATE OF TERMINATION, TO PAY YOU FOR ANY ACCRUED BUT UNUSED
VACATION DAYS AS OF THE DATE OF TERMINATION, AND TO FULFILL ITS OBLIGATIONS WITH
RESPECT TO YOUR EXERCISE OF ANY VESTED STOCK OPTIONS IN ACCORDANCE WITH THE
TERMS OF THE APPLICABLE STOCK PLAN AND OPTION AGREEMENT.  IF YOU TERMINATE YOUR
EMPLOYMENT WITH THE COMPANY FOR “GOOD REASON,” AS DEFINED BELOW, IN ADDITION TO
THE FOREGOING, THE COMPANY WILL PAY YOU THE SEPARATION PAYMENT SUBJECT TO THE
CONDITIONS SET FORTH IN SECTION 7(B) BELOW.  HOWEVER, AND NOTWITHSTANDING THE
TERMINATION OF YOUR EMPLOYMENT BY YOU, YOU WILL CONTINUE TO BE OBLIGATED TO
COMPLY WITH THE TERMS OF THE PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
AND IF APPLICABLE, THE NONCOMPETITION PROVISION SET FORTH IN SECTION 9 BELOW.

 

B.             TERMINATION BY THE COMPANY.  IF YOUR EMPLOYMENT IS TERMINATED BY
THE COMPANY “WITHOUT CAUSE” AS DEFINED BELOW, AND SUBJECT TO THE SIGNING OF A
STANDARD MUTUALLY AGREEABLE RELEASE OF ALL EMPLOYMENT-RELATED CLAIMS AGAINST THE
COMPANY, ITS SUBSIDIARIES, AND OFFICERS, DIRECTORS, AND AGENTS THEREOF, THE
COMPANY WILL PAY YOU A SEPARATION PAYMENT (THE “SEPARATION PAYMENT”) EQUAL TO
(I) IF SUCH TERMINATION OCCURS PRIOR TO THE ONE (1)-YEAR ANNIVERSARY OF THE
COMMENCEMENT DATE, AN AMOUNT EQUAL TO ONE YEAR OF YOUR THEN CURRENT ANNUAL BASE
SALARY (AND, FOR THE PURPOSE OF CLARIFICATION, THE COMPANY ACKNOWLEDGES THAT YOU
WILL NOT BE REQUIRED TO PAY BACK THE SIGNING BONUS) OR (II) IF SUCH TERMINATION
OCCURS AFTER THE ONE (1)-YEAR ANNIVERSARY OF THE COMMENCEMENT DATE AND PRIOR TO
THE TWO (2)-YEAR ANNIVERSARY OF THE COMMENCEMENT DATE, AN AMOUNT EQUAL TO ONE
YEAR OF YOUR THEN CURRENT ANNUAL BASE SALARY PLUS THE ANNUAL BONUS (AS DEFINED
HEREIN).  FOR PURPOSES OF THE IMMEDIATELY PRECEDING SENTENCE, “ANNUAL BONUS”
MEANS YOUR THEN CURRENT ANNUAL BASE SALARY MULTIPLIED BY THE MEDIAN BONUS
PERCENTAGE USED TO CALCULATE THE BONUSES AWARDED TO OTHER EXECUTIVE VICE
PRESIDENTS OF THE COMPANY FOR THE IMMEDIATELY PRECEDING YEAR.  THIS SEPARATION
PAYMENT WILL BE PAYABLE MONTHLY ON A PRO RATA BASIS OVER TWELVE (12) MONTHS
AFTER SUCH TERMINATION.  PAYMENT OF THIS SEPARATION PAYMENT WILL BE CONTINGENT
ON YOUR SIGNING THE STANDARD RELEASE OF CLAIMS REFERRED TO ABOVE.  UPON
TERMINATION OF YOUR EMPLOYMENT “WITHOUT CAUSE,” OTHER THAN THE OBLIGATIONS SET
FORTH IN THE FIRST SENTENCE OF SECTION 7(A) ABOVE AND THE ACCELERATION OF
VESTING PROVIDED IN SECTION 4(C) ABOVE, THE COMPANY WILL HAVE NO FURTHER
OBLIGATION TO YOU EXCEPT PURSUANT TO THIS PARAGRAPH.

 

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If your employment is terminated by the Company “with cause” as defined below,
the Company will have no further obligation to you under the terms of this
letter, other than the obligations set forth in the first sentence of
Section 7(a) above.  However, and notwithstanding the termination of your
employment by the Company “with cause” or “without cause,” or by you for “good
reason,” you will continue to be obligated to comply with the terms of the
Proprietary Information and Inventions Agreement and if applicable, the
noncompetition provision set forth in Section 9 below.

 

You have the right decline to receive a portion of the benefits set forth under
Sections 4 and 7 in the event that you determine that the provision of such
benefits to you would result in a “parachute payment” as such term is defined in
Section 280(G)(b)(2) of the Internal Revenue Code of 1986.

 

c.             Termination by Death or Disability.  If your employment is
terminated as a result of your death, the Company will be obligated to pay your
estate or beneficiaries (as the case may be) for services rendered by you for
the Company through the date of your death.  If your employment is terminated as
a result of your Disability, as defined below, the Company will be obligated to
pay you for services rendered by you for the Company through the date of your
termination.  In the event of termination of your employment due to death or
Disability, you, your estate or your beneficiaries, as appropriate, will be
entitled to the acceleration benefits set forth in Section 4(c).  The provisions
of this Section 7(c) will not affect or change the rights or benefits to which
you are otherwise entitled under the Company’s benefits plans or otherwise.

 

d.             Definitions.

 

For purposes of this letter, “good reason” means:

 

(i)

a reduction in your base salary without your prior written consent;

(ii)

a material reduction in your position, duties or responsibilities, without your
prior written consent;

(iii)

a change in your place of employment which is not within a 50-mile radius of the
following address, without your prior written consent: 21301 Burbank Boulevard,
Woodland Hills, CA 91367, or;

(iv)

any material breach by the Company of the terms of this letter which is not
cured by the Company within 30 days following receipt of written notice thereof.

 

For purposes of this letter, “with cause” means your commission of any one or
more of the following acts:

 

(i)

willfully damaging of the property, business, business relationships, reputation
or goodwill of the Company or its subsidiaries;

(ii)

commission of a felony or a misdemeanor involving moral turpitude;

(iii)

theft, dishonesty, fraud or embezzlement;

(iv)

willfully violating any rules or regulations of any governmental or regulatory
body that is or is reasonably expected to be injurious to the Company or its
subsidiaries;

(v)

the use of alcohol, narcotics or other controlled substances to the extent that
it prevents you from efficiently performing services for the Company or its
subsidiaries;

(vi)

willfully injuring any other employee of the Company or its subsidiaries;

(vii)

willfully injuring any person in the course of performance of services for the
Company or its subsidiaries;

(viii)

disclosing to a competitor or other unauthorized persons confidential or
proprietary information or secrets of the Company or its subsidiaries;

 

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(ix)

solicitation of business on behalf of a competitor or a potential competitor of
the Company or its subsidiaries;

(x)

harassment of any other employee of the Company or its subsidiaries or the
commission of any act which otherwise creates an offensive work environment for
other employees of the Company or its subsidiaries;

(xi)

failure for any reason within five (5) days after receipt by you of written
notice thereof from the Company, to correct, cease or otherwise alter any
insubordination, failure to comply with instructions, inattention to or neglect
of the duties to be performed by you or other act or omission to act that in the
opinion of the Company does or may adversely affect the business or operations
of the Company or its subsidiaries;

(xii)

breach of any material term of this letter; or

(xiii)

any other act or omission that is determined to constitute “cause” in the good
faith discretion of the Board of Directors.

 

For purposes of this letter, “without cause” means any reason not within the
scope of the definition of the term “with cause.”

 

For purposes of this letter, “Disability” means your inability to engage in any
substantial gainful activity necessary to perform your duties as Chief Marketing
Officer by reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted, or can be expected
to last, for a continuous period of not less than twelve (12) months.

 

8.             WITHHOLDING TAXES.  ALL FORMS OF COMPENSATION REFERRED TO IN THIS
LETTER ARE SUBJECT TO REDUCTION TO REFLECT APPLICABLE WITHHOLDING AND PAYROLL
TAXES.

 

9.             NONCOMPETITION AND NONSOLICITATION COVENANTS.  FROM AND AFTER THE
COMMENCEMENT DATE UNTIL ONE YEAR AFTER TERMINATION OF YOUR EMPLOYMENT WITH THE
COMPANY FOR ANY REASON, YOU WILL NOT DIRECTLY OR INDIRECTLY SOLICIT, ATTEMPT TO
SOLICIT, INTERFERE OR ATTEMPT TO INTERFERE WITH THE RELATIONSHIP OF THE COMPANY
OR ITS SUBSIDIARIES WITH EXISTING CUSTOMERS FOR THE PRODUCTS OR SERVICES OF THE
COMPANY OR ITS SUBSIDIARIES, ON YOUR BEHALF OR ANY OTHER PERSON OR ENTITY
ENGAGED IN THE DESIGN, DEVELOPMENT, MANUFACTURE, MARKETING OR SALE OF A PRODUCT
OR SERVICE WHICH IS IN COMPETITION WITH THE PRODUCTS OR SERVICES OF THE COMPANY
OR ITS SUBSIDIARIES; OR DIRECTLY OR INDIRECTLY SOLICIT ANY OF THE EMPLOYEES OF
THE COMPANY OR ITS SUBSIDIARIES FOR THE PURPOSE OF HIRING THEM OR INDUCING THEM
TO LEAVE THEIR EMPLOYMENT WITH THE COMPANY OR ITS SUBSIDIARIES, ON YOUR OWN
BEHALF OR ON BEHALF OF ANY OTHER PERSON OR ENTITY.  IN ADDITION, FROM AND AFTER
THE COMMENCEMENT DATE UNTIL ONE YEAR AFTER TERMINATION OF YOUR EMPLOYMENT WITH
THE COMPANY FOR ANY REASON, SO LONG AS YOU ARE RECEIVING THE SEPARATION PAYMENT,
YOU WILL NOT, AT ANY PLACE IN ANY COUNTY, CITY OR OTHER POLITICAL SUBDIVISION OF
THE UNITED STATES IN WHICH THE COMPANY OR ITS SUBSIDIARIES IS ENGAGED IN
BUSINESS OR PROVIDING ITS SERVICES:

 

a.             directly or indirectly design, develop, manufacture, market or
sell any product or service which is in competition with the products or
services of the Company or its subsidiaries; or

 

b.             directly or indirectly own any interest in, control, be employed
by or associated with or render advisory, consulting or other services
(including but not limited to services in research) to any person or entity, or
subsidiary, subdivision, division or joint venture of such entity in connection
with the design, development, manufacture, marketing or sale of a product or
service which is in competition with the products or services of the Company;
provided, however, that nothing in this letter will prohibit you from owning
less than one percent (1%) of the equity interests of any publicly held entity.

 

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10.           ENTIRE AGREEMENT.  THIS LETTER, TOGETHER WITH THE PROPRIETARY
INFORMATION AND INVENTIONS AGREEMENT,  ANY COMPANY HANDBOOKS AND POLICIES IN
EFFECT FROM TIME TO TIME AND THE COMPANY’S STOCK OPTION PLAN, STOCK OPTION
AGREEMENT AND RESTRICTED STOCK UNIT AGREEMENT, CONTAINS ALL OF THE TERMS OF YOUR
EMPLOYMENT WITH THE COMPANY AND SUPERSEDES ANY PRIOR UNDERSTANDINGS OR
AGREEMENTS, WHETHER ORAL OR WRITTEN, BETWEEN YOU AND THE COMPANY.  IN THE EVENT
ANY PROVISION OF THIS LETTER IS DETERMINED TO BE UNENFORCEABLE, INVALID OR
ILLEGAL, SUCH PROVISION SHALL BE CONSTRUED IN A MANNER SO AS NOT TO BE
UNENFORCEABLE, INVALID OR ILLEGAL WHILE GIVING EFFECT TO THE PARTIES’ INTENT TO
THE GREATEST EXTENT POSSIBLE, AND THE REMAINDER OF THIS LETTER SHALL REMAIN IN
FULL FORCE AND EFFECT.

 

11.           AMENDMENT AND GOVERNING LAW.  THIS LETTER MAY NOT BE AMENDED OR
MODIFIED EXCEPT BY AN EXPRESS WRITTEN AGREEMENT SIGNED BY YOU AND THE COMPANY. 
THE TERMS OF THIS LETTER AND THE RESOLUTION OF ANY DISPUTES WILL BE GOVERNED BY
CALIFORNIA LAW, AND VENUE FOR ANY DISPUTES WILL BE IN LOS ANGELES, CALIFORNIA.

 

12.           Term.  This letter will expire on the two (2) year-anniversary of
the Commencement Date, except Sections 6, 9, 10, 11, and 12 will survive such
expiration.  Following the expiration of this letter, your employment with the
Company will continue to be “at will.”

 

We hope this is the start of a long, successful relationship.  We hope that you
find the foregoing terms acceptable, and we look forward to working with you.
You may indicate your agreement with these terms and accept this offer by
signing and dating this letter.  This letter is contingent upon the successful
completion of a background investigation.

 

If you have any questions, please call the undersigned.

 

 

Very truly yours,

 

 

 

 

UNITED ONLINE, INC.

 

 

 

 

 

 

 

By:

/s/ Mark R. Goldston

 

Name:

Mark R. Goldston

 

Title:

Chairman, President & Chief Executive Officer

 

I have read the foregoing and accept employment with

the Company on the terms set forth in this letter:

 

/s/ Matt Wisk

 

Matt Wisk

 

Dated:

June 29, 2005

 

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