exv10w4



 





Exhibit 10.4




EMPLOYMENT AGREEMENT



THIS EMPLOYMENT AGREEMENT (this “Agreement”), is made and entered into as of
November 9, 2001 by and between BLACKBOARD INC., a Delaware corporation (the
“Company”), and Matthew Pittinsky (the “Employee”).



RECITALS





	A.	 	The Company desires to retain Employee to provide the services
hereinafter set forth.
	 
	B.	 	Employee is willing to provide such services to the Company on the terms
and conditions hereinafter set forth.




AGREEMENT



In consideration of the promises and the terms and conditions set forth in this
Agreement, the parties agree as follows:





	1.	 	Employment and Term.
	 
	 	 	The Company agrees to employ the Employee and the Employee agrees to work
for the Company, subject to the terms and conditions below, for a term of
four (4) years from the date hereof. The Company agrees to provide the
Employee with written notice at least 90 days prior to the expiration of
the term as to whether the Company desires to negotiate a new employment
agreement with the Employee to operate following expiration of the term
of this Agreement. The Company shall be under no obligation to negotiate
a new employment agreement.
	 
	2.	 	Compensation; Benefits.
	 
	 	 	Subject to the terms and conditions of this Agreement, the Company shall
pay to the Employee a base salary as set forth on Schedule A, attached
hereto and made a part hereof, payable in accordance with the Company’s
regular payroll policies. In addition to this base salary, the Employee
shall be entitled to the benefits and bonuses described on Schedule A,
subject to the terms and conditions described therein. In addition, the
Employee shall be entitled to receive such other benefits including, but
not limited to, vacation, holidays and sick leave, as the Company
generally provides to its senior executives and employees holding similar
positions as that of the Employee. Notwithstanding the foregoing, the
Company reserves the right to adopt, amend or discontinue any employee
benefit plan or policy in accordance with then-applicable law
	 
	3.	 	Business Expenses. The Company shall reimburse the Employee
during the term
of this Agreement for travel, entertainment and other expenses reasonably





 









 






	 	 	incurred by the Employee on behalf of the Company pursuant to the
Company’s expense reimbursement policy for its employees.






	4.	 	Title; Duties.
	 
	 	 	The Employee shall be employed as Chairman. The Employee shall
diligently and conscientiously devote his full time and attention and his
best efforts to discharge the duties assigned to him by the Company. The
Employee shall perform such duties as may be assigned to him from time to
time by the Board of Directors.
	 
	5.	 	Right to Contract; Conflict of Interest.
	 
	 	 	The Employee hereby represents and warrants to the Company that (i) he
has full right and authority to enter into this Agreement and to perform
his obligations hereunder, and (ii) the execution and delivery of this
Agreement by the Employee and the performance of the Employee’s
obligations hereunder will not conflict with or breach any agreement,
order or decree to which the Employee is a party or by which he is bound.
During the term of this Agreement, the Employee shall not directly or
indirectly consult, advise, be retained or employed by, or in any manner
perform any service with any other business or entity in any line of
business competitive with the Company’s business, without first obtaining
consent in writing from the Company.
	 
	6.	 	Transfer by Company.
	 
	 	 	If at any time during the term of this Agreement, the Company transfers
the Employee to another location, the Company will reimburse the Employee
for all reasonable relocation expenses incurred as a result of such
transfer. In the event that the Employee terminates this Agreement
without cause pursuant to Section 9 hereof within one year after any such
transfer, the Employee shall refund to the Company all amounts paid to
him by the Company as relocation expenses (including temporary housing
and incidental expenses) pursuant to this Section 6. The Employee agrees
that any amounts owing to the Company under this Section 6 may be
deducted from any salary, bonuses or other amounts owed to him by the
Company, consistent with applicable law.
	 
	7.	 	Termination by the Company.






	 	(a)	 	The Company shall have the right to terminate this Agreement
with or without Cause (as defined below) at any time during the term
of this Agreement by giving written notice to the Employee. The
termination shall become effective on the date specified in the
notice, which termination date shall not be a date prior to the date
ten (10) days following the date of the notice of termination
itself. In the event that the
Employee is terminated for Cause, the Company shall pay the
Employee




 









 












	 	 	 	the salary due him under this Agreement through the day
on which such termination is effective. In the event that the
Employee is terminated without cause, the Company shall, subject
to the provisions of this Agreement:






	 	 	 	(i) pay to the Employee within thirty (30) days of termination of
        employment a cash payment equal to his annual base salary, earned bonus
        through the end of the last then ended full quarter, expense reimbursements
        and fringe benefits set forth on Schedule A, in a lump sum or in
        accordance with normal payroll practices, at the Company’s option;
        and






	 	 	 	(ii) maintain and provide for a period of twelve (12) months from
        the date of termination, at no cost to the Employee, the Employee’s
        continued participation in all group insurance, life insurance, health
        and accident, disability and other employee benefit plans, programs and
        arrangements in which the Employee was entitled to participate immediately
        prior to the date of termination (other than any bonus plans or stock
        option plans of the Employer), provided that in the event that the Employee’s
        participation in any plan, program or arrangement as provided in this
        subparagraph (ii) is barred or during such period any such plan,
        program or arrangement is discontinued or the benefits thereunder are
        materially reduced, the Employer shall arrange to provide the Employee
        with benefits substantially similar to those which the Employee was entitled
        to receive under such plans, programs and arrangements immediately prior
        to the Employee’s date of termination.







	 	 	 	(iii) provide Employee with the right to exercise all vested options at
        any time within two (2) years after the date of such termination.
        This clause amends and modifies any option grant agreements in effect
        as of the date of this agreement.






	 	(b)	 	For purposes of this Section 7, “Cause” shall mean (i) a
material breach by the Employee of any fiduciary duty owed to the
Employer or any material covenant or condition hereunder or a
material failure of performance by the Employee under this
Agreement which shall be continuing and uncured for fifteen (15)
days after written notice thereof has been given to the Employee by
the Company; (ii) a material neglect of duty by the Employee; (iii)
the commission by the Employee of any act or omission constituting
gross negligence, dishonesty, fraud, immoral or disreputable
conduct which is, or is likely to be, harmful to the Company or its
reputation; (iv) violation by the Employee of any material federal,
state or local law, rule regulation or ordinance (other than
misdemeanor traffic violations); (v) material violation by the
Employee of the Company’s policies as set forth in the Company’s
personnel handbook, if one has been
adopted, or announced by Company management from time to time;
(vi)




 









 












	 	 	 	violation of the Company’s drug and alcohol policy as set
forth in the Company’s personnel handbook, if one has been
adopted, or announced by Company management from time to time; or
(vii) the performance by the Employee of any act or omission
demonstrating an intentional or reckless disregard of the
interests of the Company.






	 	(c)	 	In the event the Employee disputes in writing any termination
for Cause (after the Employee receives the grounds for termination
from the Company’s Board of Directors pursuant to Section 1(a) of
the Stock Restriction Agreement), the Company shall pay the Employee
full salary (including any earned bonuses or fringe benefits) for a
period of no more than three (3) months while the Company and the
Employee attempt to resolve such dispute in good faith.






	8.	 	Termination by Death or Disability of the Employee.






	 	(a)	 	In the event of the Employee’s death during the term of this
Agreement, all obligations of the parties hereunder shall terminate
immediately, and the Company shall pay to the Employee’s legal
representatives the salary (and any earned bonuses) due the Employee
through the day on which his death shall have occurred.






	 	(b)	 	If the Employee is unable to perform his duties hereunder due
to mental, physical or other disability for a period of one hundred
twenty (120) consecutive business days, as determined by the
Company, or for one hundred twenty (120) business days in any period
of twelve (12) consecutive months, this Agreement may be terminated
by the Company, at its option, by written notice to the Employee,
effective on the termination date specified in such notice, provided
such termination date shall not be a date prior to the date of the
notice of termination itself. In this case, the Company will pay
the Employee the salary (and any earned bonuses) due him through the
day on which such termination is effective.






	 	(c)	 	The Company shall pay Employee the difference between the
amount to be paid under any disability insurance policy for the
twelve (12) months following termination and the amount of
Employee’s salary due under the termination provision of Section 7
(a) (i).





 









 











	9.	 	Termination by the Employee.






	 	(a)	 	The Employee may terminate this Agreement at any time, with or
without cause, by giving written notice to the Company. Any such
termination, if without cause, shall become effective on the date
specified in such notice, provided that the Company may elect to
have such termination become effective on a date after, but not
more than, fourteen (14) days after the date of the notice. If
such termination is with Good Reason, (i) it shall become
effective on the date thirty (30) days after the date of such
notice, provided the Company has failed to cure the cause
specified in the notice; and (ii) the Company shall provide
Employee with the right to exercise all vested options at any time
within two (2) years after the date of such termination; and (iii)
the Company shall pay to the Employee his annual base salary for
twelve (12) months from the date of termination, and earned bonus
through the end of the last then ended full quarter, payable in
either one lump sum or in accordance with normal payroll
practices, at Company’s option, through the end of the
Non-Complete Period (as defined in Section 11 below). This clause
amends and modifies any option grant agreements in effect as of
the date of this agreement.






	 	(b)	 	In the event the Employee terminates this Agreement without
Good Reason, the Employee shall be entitled to the salary, bonus and
other benefits due him through the day on which such termination
becomes effective.






	 	(d)	 	For purposes of this Section 9, “Good Reason” shall mean (i)
a material failure by the Company to perform its obligations under
this Agreement; (ii) a Constructive Termination (as defined below)
of the Employee; or (iii) if employee is not offered a Satisfactory
Employment Agreement (as defined in the Stock Restriction Agreement)
in connection with a Sale Transaction (as defined in the May Stock
Restriction Agreement).






	 	(e)	 	For purposes of this Section 9. “Constructive Termination”
shall mean any (i) diminution of the Employee’s total compensation
(defined as the Employee’s salary and bonuses described on Schedule
A, subject to the terms and conditions described therein), or (ii)
material adverse modification of or diminution in the Employee’s
duties or material diminution in the Employee’s authority, title or
office, or the assignment of any duties to the Employee inconsistent
with or demeaning of those set forth above, or (iii) material
reduction in the Employee’s benefits under any employee benefit plan
or program in which he participates as an employee, other than any
reduction which is a result of a reduction of benefits applicable to
all employee participants, or relocation of the Employee outside of
the Employee’s current residential area without the Employee’s
consent. Notwithstanding the foregoing, a Constructive





 









 











	 	 	 	Termination shall not exist if the Employee’s total compensation
is diminished due to the failure of Employee to earn the bonus
described on Schedule A because the annual goals referred to
therein are not attained.






	10.	 	Suspension.
	 
	 	 	In the event the Company has reasonable cause to believe that there
exists Cause for termination of this Agreement as defined in Section 7,
immediately upon written notice to the Employee, the Company may, but
shall not be obligated to, suspend the Employee, with pay, for a period
not to exceed two (2) weeks, either as a disciplinary measure or in order
to investigate the Company’s belief that such cause exists. No such
suspension shall prevent the Company from thereafter exercising its
rights to terminate this Agreement in accordance with its terms.






	11.	 	Non-competition.






	 	(a)	 	The Employee agrees that during his employment hereunder, and
for a period of one (1) year (the “Non-Compete Period”) after the
later of (i) the effective date of termination of this Agreement, or
(ii) the date of entry by a court of competent jurisdiction of a
final judgment enforcing this covenant, he will not, in any
geographic area where the Company regularly engages in its Business
(as defined below) or maintains sales or service representatives or
employees:






	 	 	 	(i) compete with the Company, or any subsidiary or affiliate of the Company;
	 
	 	 	 	(ii) interfere with or disrupt, or attempt to interfere with or disrupt,
        the relationship contractual or otherwise, between the Company, or any
        subsidiary or affiliate of the Company, and any customer, supplier or
        employee of the Company, or any such subsidiary or affiliate;
	 
	 	 	 	(iii) assist a competitor of the Company by providing consulting or other
        advisory services to that competitor; or
	 
	 	 	 	(iv) offer employment to any current employee of the Company or solicit
        (directly or indirectly, individually or in connection with any new employer
        or other business partner) any current employee of the Company to accept
        employment elsewhere.






	 	(b)	 	The following terms, as used in this Section 11 shall have
the meanings set forth below:






	 	 	 	(i) The Company’s “Business” means any and all lines of
        business engaged in by the Company at, or within one year prior to, inception
        of the




 









 












	 	 	 	Non-Compete Period, or reasonably anticipated to be entered by the
Company on the date of inception of the Non-Compete Period.
	 
	 	 	 	(ii)The term “compete” means to engage in competition, directly
or indirectly, individually or through a family member or other
person acting on the Employee’s behalf, as an employee, officer,
director, proprietor, partner or stockholder or other security
holder (other than of a corporation listed on a national
securities exchange or the securities of which are regularly
traded in the over-the-counter market, provided that the Employee
at no time owns in excess of 5% of the outstanding securities of
such corporation entitled to vote for the election of directors)
of any firm, corporation or entity of any nature whatsoever.
	 
	 	 	 	(iii)The term “affiliate” means any person, firm or corporation,
directly or indirectly through one or more intermediaries,
controlling, controlled by or under common control with the
Company.






	 	(c)	 	The Employee further acknowledges that this Section 11 is an
independent covenant within this Agreement, and that this covenant
shall survive any termination of this Agreement and shall be treated
as an independent covenant for the purposes of enforcement. With
respect to this covenant, the Employee hereby acknowledges receipt
of Ten Dollars ($10.00) and other good and valuable consideration
stated herein including the consideration of his continued
employment by the Company.
	 
	 	(d)	 	The Employee shall, during the term of this Agreement and
thereafter, notify any prospective employer of the terms and
conditions of this Agreement regarding nondisclosure and
non-competition.






	12.	 	Confidentiality and Non-Disclosure.






	 	(a)	 	The Employee shall hold in strict confidence and shall not,
either during the term of this Agreement or after the termination
hereof, disclose, directly or indirectly, to any third party,
person, firm, corporation or other entity, irrespective of whether
such person or entity is a competitor of the Company or is engaged
in a business similar to that of the Company, any trade secrets or
other proprietary or confidential information of the Company or any
subsidiary or affiliate (as defined in Section 11) of the Company
obtained by the Employee from or through his employment hereunder.
The Employee hereby acknowledges and agrees that all proprietary
information referred to in this Section 12 shall be deemed trade
secrets of the Company and of its subsidiaries and affiliates, as
defined in Section 11. Employee further acknowledges that the
Company’s products and titles consist of copyrighted material, and
Employee shall exercise his best efforts to prevent the use of such
copyrighted material by any person or entity which has not prior
thereto




 









 












	 	 	 	been authorized to use such information by the Company.






	 	(b)	 	The Employee further hereby agrees and acknowledges that any
disclosure of any proprietary information prohibited herein, or any
breach of the provisions of Sections 4 or 10 of this Agreement, may
result in irreparable injury and damage to the Company which will
not be adequately compensable in monetary damages, that the Company
will have no adequate remedy at law therefore, and that the Company
may obtain such preliminary, temporary or permanent mandatory or
restraining injunctions, orders or decrees as may be necessary to
protect the company against, or on account of, any breach by the
Employee of the provisions contained in Sections 5, 11 or 12 . The
Employee shall reimburse the reasonable legal fees and other costs
incurred by the Company in enforcing the provisions of Sections 5,
11 and 12 of this Agreement.
	 
	 	(c)	 	The Employee further agrees that, upon termination of this
Agreement, whether voluntary or involuntary or with or without
cause, the Employee shall notify any new employer, partner,
associate or any other firm or corporation with whom the Employee
shall become associated in any capacity whatsoever of the provisions
of this Section 12, and that the Company may give such notice to
such firm, corporation or other person.
	 
	 	(d)	 	Notwithstanding the foregoing limitations, the Employee shall
not be required to keep confidential pursuant to this Section 12 any
confidential or proprietary information that: (i) is known or
available through other lawful sources, not bound by a
confidentiality agreement with the Employee, (ii) is or becomes
publicly known or generally known in the industry through no fault
of the Employee or his agents or (iii) is required to be disclosed
pursuant to any statutes, laws, rules, regulations, ordinances,
codes, directives, writs, injunctions, decrees, judgments, and
orders of any governmental body (provided the Company is given
reasonable prior notice).






	13.	 	Assignment and Disclosure of Inventions.






	 	(a)	 	From and after the date the Employee first became employed
with the Company, the Employee hereby agrees to promptly disclose in
confidence to the Company all inventions, improvements, designs,
original works of authorship, formulas, processes, compositions of
matter, computer software programs, databases, mask works, and trade
secrets (“inventions”), whether or not patentable, copyrightable or
protectible as trade secrets, that are made or conceived or first
reduced to practice or created by the Employee, either alone or
jointly with others, during the period of the Employee’s employment,
whether or not in the course of the Employee’s employment.





 









 











	 	(b)	 	The Employee hereby acknowledges that copyrightable works
prepared by the Employee within the scope of the Employee’s
employment are “works for hire” under the Copyright Act and that the
Company will be considered the author thereof. The Employee hereby
agrees that all Inventions that (i) are developed using equipment,
supplies, facilities or trade secrets of the Company, (ii) result
from work performed by the Employee for the Company, (iii) relate to
the Company’s business or current or anticipated research and
development, will be the sole and exclusive property of the Company
and are hereby assigned by the Employee to the Company.






	14.	 	Severability.
	 
	 	 	The Company and the Employee recognize that the laws and public policies
of the state law applicable to this Agreement is subject to varying
interpretations and change. It is the intention of the Company and of
the Employee that the provisions of this Agreement shall be enforced to
the fullest extent permissible under the laws and public policies of such
state, but that the unenforceability (to the modification to conform to
such laws or public policies) of any provision or provisions hereof shall
not render unenforceable, or impair, the remainder of this Agreement.
Accordingly, if any provisions of this Agreement shall be determined to
be invalid or unenforceable, either in whole or in part, this Agreement
shall be deemed amended to delete or modify, as necessary, the offending
provision or provisions and to alter the balance of this Agreement in
order to render it valid and enforceable.
	 
	15.	 	Assignment.
	 
	 	 	Neither the rights nor obligations under this Agreement may be assigned
by either party, in whole or in part, by operation of law or otherwise,
except that it shall be binding upon and inure to the benefit of any
successor of the Company and its subsidiaries and affiliates, whether by
merger, reorganization or otherwise, or any purchaser of all or
substantially all of the assets of the Company.
	 
	16.	 	Notices.
	 
	 	 	Any notice expressly provided for under this Agreement shall be in
writing, shall be given either manually or by mail and shall be deemed
sufficiently given when actually received by the party to be notified or
when mailed, if mailed by certified or registered mail, postage prepaid,
addressed to such party at their addresses as set forth below. Either
party may, by notice to the other party, given in the manner provided for
herein, change their address or receiving such notices.




 









 












	 	(a)	 	If to the Company, to:
	 
	 	 	 	Blackboard Inc.

1899 L Street N.W., Fifth Floor

Washington, D.C. 20036

Attn: General Counsel
	 
	 	(b)	 	If to the Employee, to:
	 
	 	 	 	Matthew Pittinsky

200 West 79th Street

Apartment 7F

New York, NY 10024






	17.	 	Governing Law.
	 
	 	 	This Agreement shall be executed, construed and performed in accordance
with the laws of the State of Delaware without reference to conflict of
laws principles. The parties agree that the venue for any dispute
hereunder will be the state or federal courts sitting in the District of
Columbia or the Commonwealth of Virginia and the parties hereby agree to
the exclusive jurisdiction thereof.
	 
	18.	 	Headings.
	 
	 	 	The section headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
	 
	19.	 	Entire Agreement; Amendments.
	 
	 	 	This Agreement, together with any stock option contracts between the
Company and Employee, constitutes and embodies the entire agreement
between the parties in connection with the subject matter hereof and
supersedes all prior and contemporaneous agreements and understandings in
connection with such subject matter. No covenant or condition not
expressed in this Agreement shall affect or be effective to interpret,
change or restrict this Agreement. In the event of a conflict or
inconsistency between the terms of this Agreement and the Company’s
policies regarding employees, the terms of this Agreement shall supersede
the conflicting or inconsistent Company policies. No change, termination
or attempted waiver of any of the provisions of this Agreement shall be
binding unless in writing signed by the Employee and on behalf of the
Company by an officer thereunto duly authorized by the Company’s Board of
Directors. No modification, waiver, termination, rescission, discharge
or cancellation of this Agreement shall affect the right of any party to
enforce any other provision or to exercise any right or remedy in the
event of any other default.





[SIGNATURE PAGE FOLLOWS]



 









 




IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.




	 	 	 
	BLACKBOARD INC., a Delaware corporation
	 
	 	 
	By:

	 	/s/ E. Rogers Novak, Jr.
	

	 	
 
	

	 	Name: E. Rogers Novak, Jr.
	 
	 	 
	

	 	Title: Director







	 
	Matthew Pittinsky

	 

	/s/ Matthew Pittinsky

	
 









 









 






SCHEDULE A



The Employee is currently being paid $200,000 in annual salary; however
the Compensation Committee reserves the right to increase the Employee’s
salary from time to time, in accordance with the Company’s regular
management employee payroll and incentive policies.



The Employee shall receive for each year thereafter, an annual bonus
equal to up to 50% of Employee’s then current salary, payable in cash.
The criteria for bonuses shall be based on goals established by the
Compensation Committee of the Board of Directors on an annual basis.



Employee shall receive vacation, parking, health and insurance benefits
equal to that provided other senior executive management, which benefits
may be changed from time to time by the Company.




 









 








AMENDMENT TO EMPLOYMENT AGREEMENT




     THIS AMENDMENT TO EMPLOYMENT AGREEMENT (the “Amendment”) is made
and entered into as of the 18th day of February, 2004 by and between Blackboard
Inc., a Delaware corporation (the “Company”), and Matthew L. Pittinsky
(the “Employee”). Any undefined capitalized term used herein shall have
the meaning ascribed to it in that certain Employment Agreement, dated as of
November 9, 2001 (as so amended, the “Employment Agreement”).



     WHEREAS, the Company and Employee are parties to the Employment Agreement;
and



     WHEREAS, the Company and Employee wish to amend the Employment Agreement
to increase the Employee’s base salary;



     NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Amendment and pursuant to Section 19 of the Employment
Agreement, the Company and the Employee do hereby amend the Employment
Agreement, as follows:



     1. Base Salary. The base salary of $200,000 in the first sentence
of Schedule A to the Employment Agreement shall be deleted in its entirely and
replaced with a base salary of $225,000.



     2. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Delaware (without regard
to conflict of laws provisions).



     3. Entire Agreement. The Employment Agreement, as amended hereby,
constitutes the full and entire understanding between the parties regarding the
subject matter herein. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.



     4. Full Force and Effect. Except as amended hereby, the Employment
Agreement shall remain in full force and effect.



     5. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.



     6. Headings. Headings in this Amendment are included for reference
only and have no effect upon the construction or interpretation of any part of
this Amendment.



     IN WITNESS WHEREOF, the Company and the Employee have caused this
Amendment to be executed by their respective duly authorized officers as of the
date first above recited.



	 	 	 	 	 
	COMPANY: BLACKBOARD INC.	 	EMPLOYEE:
	 
	 	 	 	 
	By:

	 	/s/ Matthew Small
	 	/s/ Matthew L. Pittinsky
	

	 	
 
	 	
 
	Name:

	 	Matthew Small
	 	Matthew L. Pittinsky
	Title:

	 	General Counsel