**Exhibit 10.14**

 

**EMPLOYMENT AGREEMENT**

 

This Employment Agreement(“Agreement”), the Release attached as Schedule A hereto (“the Release”),the Nonsolicitation Agreement attached hereto as Schedule B (the“Nonsolicitation Agreement”) and the Noncompetition Agreement attached asSchedule C hereto (the “Noncompetition Agreement”) are made and enteredinto between Digital River, Inc., including its agents, facilities, affiliates,associated entities, joint ventures, subsidiaries, predecessors, successors, officers,directors, assigns, employees, stockholders, delegates, benefit plans and planadministrators, attorneys and insurers (collectively “Digital River”), and  Gary Howorka (“Mr. Howorka”).  Notwithstanding any other provision of thisAgreement, this Agreement shall not be effective or have any effect until theRelease has become effective and enforceable. Mr. Howorka and DigitalRiver are sometimes referenced collectively as the “Parties” to this Agreement.

 

Digital River andMr. Howorka wish to provide for the modification of their employment andother contractual relationships in connection with Mr. Howorka’sresignation as an Officer of Digital River, Inc., as follows:

 

**I.****                                         MR. HOWORKA’SEMPLOYMENT.**

 

The parties agree thatMr. Howorka will have the title of Senior Vice President – AdvancedTechnologies, reporting to the Chief Executive Officer,  effective September 29, 2003 (the“Transfer Date”), until February 13, 2004 (the “Strategic PlanningPeriod”).  The parties agree thatMr. Howorka’s employment with Digital River will terminate onFebruary 13, 2004 , or sooner if Mr. Howorka accepts other employment(excluding board memberships and part-time consulting arrangements) (such date,the “Separation Date”) or materially breaches this Agreement, including theSchedules thereto.  The parties agreethat Mr. Howorka shall remain an employee of Digital River during theStrategic Planning Period, except as specifically provided herein.  The parties agree that Mr. Howorkashall not be an executive officer of Digital River after the TransferDate.  The parties agree thatMr. Howorka shall be paid at an annual salary of $125,000, less applicablewithholdings, in accordance with Digital River’s normal payroll practices duringthe Strategic Planning Period.

 

During the StrategicPlanning Period Mr. Howorka shall assist Digital River in such projectsand work as Digital River may assign to Mr. Howorka.  Such projects and work may include but arenot limited to technology architecture, design, intellectual property identificationand protection.  Digital River mayassign work to Mr. Howorka at its sole discretion during the StrategicPlanning Period.  Mr. Howorka maywork at such location as he deems appropriate, subject to the reasonablerequirements of Digital River.  DigitalRiver is an at will employer, and neither Mr. Howorka or Digital River is boundto continue the employment relationship if either chooses, at its will, to endthe relationship at any time period.  Notwithstanding the foregoing, in the event that Digital Riverterminates Mr. Howorka’s employment without cause during the Strategic PlanningPeriod, or terminates Mr. Howorka’s employment for cause during the StrategicPlanning Period where the events deemed to provide “cause” occurred prior tothe date of this Agreement, then (i) Mr. Howorka will be relieved of anyobligations to Digital River under the Noncompetition Agreement and (ii) theRelease will no longer be of any force or effect.  Mr. Howorka agrees during the Strategic Planning Period thathe will faithfully, industriously, and to the best of his ability, experience,and talents, perform all of the duties that may be required by Digital River.

 

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The parties agreethat Digital River shall pay Mr. Howorka for all accrued and used vacationas soon as is practicable after the Transfer Date.  The parties agree that Mr. Howorka shall no longer accruevacation after the Transfer Date.

 

**II.****                                     CONSIDERATION.**

 

In exchange forthe covenants and promises contained in this Agreement and its attachments, andsubject to this Agreement, Digital River agrees to provide Mr. Howorkawith the following compensation and benefits (the “Consideration”):

 

**A.****                                    Payment**.  Digital River will continue to make paymentsto Mr. Howorka through February 13, 2004 as discussed in Paragraph Iabove.

 

**B.****                                    Withholding**.  Digital River will withhold from thecompensation and benefits payable to Mr. Howorka under this Agreement andthe attached Release all appropriate deductions for life insurance, short termdisability, health insurance and dental insurance, as applicable.

 

**C.****                                    Acknowledgment**.  The parties acknowledge that theconsideration provided in this Agreement is valuable consideration for thisAgreement (including its attachments) and its covenants, and includes paymentsand benefits to which Employee is not otherwise entitled.

 

**III.****                                 COVENANTSOF MR. HOWORKA.**

 

**Confidentiality**.  The Parties understand that this agreementmay be filed with the Securities and Exchange Commission at such time asrequired by the rules of the Securities and Exchange Commission.  Until such time this contract is so filed,the parties agree that this agreement shall remain confidential.  Until such filing, Mr. Howorka warrantsthat he has not disclosed, and agrees he will not in the future disclose, theterms of this Agreement, or the existence or terms of consideration to be paidby Digital River to Mr. Howorka, as part of this Agreement and/or thesettlement of his claims, to any person, other than to Mr. Howorka’sattorneys and tax advisors (“Confidential Persons”). Mr. Howorka agreesthese Confidential Persons shall be bound by the same prohibitions againstdisclosure as he is, and Mr. Howorka shall be responsible for advisingthese individuals of this confidentiality provision and obtaining theircommitment to maintain such confidentiality.

 

**A.****                                    Returnof Property**.  No later than theSeparation Date, except as mutually agreed otherwise, Mr. Howorka willreturn to Digital River all company property, including but not limited to allidentification cards, files, computer hardware, software, equipment and disks,keys, credit cards and records.  Theproperty to be returned includes all information or data regarding clients,prospective clients and vendors of Digital River, whether in original orduplicate form.

 

**B.****                                    Cooperation**.  Mr. Howorka agrees to cooperate fullywith Digital River, including its attorneys or accountants, in connection withany potential or actual litigation, or other real or potential disputes, whichdirectly or indirectly involve Digital River. Mr. Howorka agrees to appear as a witness and be available toattend depositions, consultations or meetings regarding litigation or potentiallitigation as requested by Digital River.

 

**C.****                                    ConfidentialInformation**.  Mr. Howorkaacknowledges that he has had access to confidential business information(including, but not limited to, future business plans and personnelinformation) concerning the business, strategic plans, finances and assets ofDigital River (“Confidential Information”). This Confidential Information is not generally known outside of DigitalRiver.  Mr. Howorka agrees that hewill not, without the prior written authorization of Digital River, directly or

 

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indirectly use, divulge,furnish or make accessible to any person any Confidential Information, butinstead shall keep all Confidential Information strictly and absolutelyconfidential.  Mr. Howorka willtake reasonable care to safeguard and prevent the unauthorized use ordisclosure of Confidential Information.

 

Mr. Howorka expressly acknowledges that he understands that theterms of this subsection are important to this Agreement and that, if hebreaches the terms of this subsection, he shall be responsible for all damagesto Digital River.  Mr. Howorka alsoacknowledges and agrees that the Confidential Information acquired during hisemployment with Digital River is valuable and unique, and that breach byMr. Howorka of the provisions of this subsection would cause DigitalRiver irreparable injury and damage that cannot be reasonably or adequatelycompensated by money damages. Mr. Howorka therefore expressly agrees that Digital River shall beentitled to injunctive or other equitable relief in order to prevent a breachof this subsection of the Agreement in addition to such other remedieslegally available to Digital River. Mr. Howorka expressly waives the claim that Digital River has anadequate remedy at law for such a breach.

 

**IV.****                      ADDITIONALPROVISIONS**.  Mr. Howorkaagrees to execute the Nonsolicitation Agreement attached as Schedule B andthe Non-Competition Agreement attached as Schedule C; and confirms thatthe Release previously executed by him on September 26, 2003 remains ineffect, subject to the rescission rights described in Section VI thereof.

 

**V.****                                    MISCELLANEOUSPROVISIONS.**

 

**A.****                                    Non-Assignmentof Claims**.  Mr. Howorkarepresents that he has not sold, assigned, or transferred to any third partyany obligation, covenant, or claim of any nature whatsoever relating to anymatter covered by this Agreement.

 

**B.****                                    Successors**.  This Agreement shall be binding upon,enforceable by, and inure to the benefit of Mr. Howorka’s personal orlegal representatives and heirs, and of Digital River and any successorcompany, but neither this Agreement nor any rights or payments arisinghereunder may be otherwise assigned or pledged by the parties.

 

**C.****                                    ControllingLaw and Venue**.  The validity ofthis Agreement and any of its provisions and conditions, as well as the rightsand duties of the parties, shall be interpreted and construed pursuant to andin accordance with the internal laws, and not the law of conflicts, of theState of Minnesota.  The Parties selectand irrevocably submit to the exclusive jurisdiction of any Minnesota or UnitedStates Federal Court sitting in the State of Minnesota for any action toenforce, construe or interpret this Agreement. The Parties further waive any objection to venue in such state on thebasis of forum non conveniens or of convenience of the party.

 

**D.****                                    Amendment**.  Any amendment to this Agreement shall bemade in writing and signed by the Parties.

 

**E.****                                      Waiver**.  No right arising out of this Agreement canbe waived unless the waiver is in writing signed by the party to be bound bysuch waiver.  A waiver by any party of abreach or default of any provision of this Agreement shall not be deemed awaiver of future compliance.

 

**F.****                                      EntireAgreement**.  Digital River andMr. Howorka each represent that no promise or inducement has been offeredor made except as set forth or referenced above, or in Schedule A,Schedule B or Schedule C, and that the consideration stated herein isthe sole consideration for this Agreement. This Agreement and its attachments supersede any prior agreement betweenthe parties with

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respect to the subject matterhereof; provided that the Release shall continue to be of full force andeffect, subject to Mr. Howorka’s rescission rights described in Section VIof the Release.

 

**G.****                                    Severability**.   If one or more provisions of this Agreementare held to be unenforceable under applicable law, (i) such provisionshall be excluded from this Agreement, (ii) the balance of the Agreementshall be interpreted as if such provision were so excluded and (iii) thebalance of the Agreement shall be enforceable in accordance with its terms.

 

**INWITNESS WHEREOF,** the parties hereto have executed thisAgreement on the date set forth below:

 

 
| **Gary Howorka** |                | **DIGITAL RIVER, INC.** |
|------------------|---------------------|-------------------------|
|             |                |                    |
|             |                |                    |
| /s/ Gary Howorka |                | By:                     |  /s/ Carter D. Hicks |   |
|             |                | Its:                    | CFO |   |
|             |                |                    |   |
| Date:            | 10/9/03 and 9/26/03 |                    | Date: | 10/9/03 and 9/26/03 |   |
|                  |                     |                         |  |  |  |  |

 

 

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**Schedules A,B and C – Intentionally Omitted**

 

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