exv10w8



 





Exhibit 10.8




3am Labs, Inc.

500 Unicorn Park Drive

Woburn, MA 01801




April 18, 2005




Richard Redding

241 Webster Highway

Temple, New Hampshire 03084



Dear Richard:




     We are pleased with your decision to accept the position of Vice President of Business
Development with 3am Labs, Inc. (the “Company”) reporting to the CEO and starting May 23,
2005 and appreciate the your help in formalizing our relationship as set forth herein. In
consideration of the your employment by the Company, the Company and you hereby confirm and agree
to your engagement as an at-will employee of the Company subject to and upon the terms and
conditions set forth in this letter. For purposes of convenience, you will be referred to in this
letter as “the Employee.”



Duties and Position




     As an employee of the Company, the Employee will hold the title set forth on Schedule
1 hereto and have responsibility for performing those duties as are consistent with the
Employee’s current position and at the base salary (payable in accordance with the Company’s
standard payroll practices) set forth on Schedule 1 hereto, subject to changes as may
deemed appropriate by the Company in the future consistent with the Company’s business objectives
and goals. The Employee agree to abide by the rules, regulations, instructions, personnel
practices and policies of the Company as may be in effect from time to time, in addition to any
changes therein which may be adopted from time to time by the Company. Except for vacations and
absences due to temporary illness, the Employee will be expected to devote the Employee’s full time
and effort to the business and affairs of the Company.



Employee Benefits




     In addition, the Employee will be entitled to participate in such employee benefit plans and
fringe benefits as may be offered or made available generally by the Company from time to time to
its employees and those plans specifically set forth on Schedule 1 hereto. The Employee’s
participation in such employee benefit plans and fringe benefits, and the amount and nature of the
benefits to which the Employee shall be entitled thereunder or in connection therewith, shall be
subject to the terms and conditions of such employee benefit plans and fringe benefits. The
Company’s Board of Directors reserves the right from time to time to change the Company’s employee
benefit plans and fringe benefits.



 









 





Stock Option




     At the First meeting of the Company’s Board of Directors following the date hereof, or as soon
as reasonably practicable thereafter, subject to approval by the Company’s Board of Directors, the
Employee shall receive from the Company incentive stock options (each, an “Option” and
collectively, the “Options”) under the Company’s 2004 Equity Incentive Plan (the
“Plan”) to purchase the aggregate number of shares (the “Option Shares”) of
Common Stock set forth on Schedule 1 hereto at an exercise price equal to the fair market
value of the Common Stock, as determined by the Board of Directors of the Company, on the date of
the grant of the Options (the “Grant Date”) and subject to the other terms set
forth below in the next three paragraphs.



     The Options shall become exercisable as set forth on Schedule 1 hereto.



     Upon a Change of Control (as such term is defined in the Plan), fifty percent (50%) of the
Option set forth on Schedule 1 hereto under the heading “Initial Grant” shall become exercisable as
to any and all shares subject to the Option that are not exercisable in full at the time of such
Change of Control.



     After the Grant Date, the Company and the Employee shall execute and deliver to each other the
Company’s then standard form of stock option agreement, evidencing each Option and the terms
thereof, which terms shall not be inconsistent with the terms set forth in the foregoing
paragraphs. The Options shall be subject to, and governed by, the terms and provisions of the Plan
and the Employee’s stock option agreements. The obligation of the Company to issue to the Employee
the Option Shares shall also be subject to the Employee’s agreement and willingness to execute and
deliver any other form of stockholders agreement, voting agreement or other agreement required by
the Plan, or that the Company shall reasonably request and that the Company generally requires that
its stockholders execute and deliver.



Confidentiality and Assignment of Inventions and Non-Competition Agreement




     As a condition to the Employee’s employment with the Company, and in consideration for the
Options the Company shall grant to the Employee, the Employee agree to sign a copy of the Company’s
standard Confidentiality and Assignment of Inventions and Non-Competition Agreement, a copy of
which is attached as Exhibit A hereto and incorporated herein as if set forth in
its entirety.



No Conflicting Obligation




     The Employee hereby represent and warrant that the execution and delivery of this letter
agreement, the performance by the Employee of any or all of the terms of this letter agreement and
the performance by the Employee of the Employee’s duties as an employee of the Company do not and
will not breach or contravene (i) any agreement or contract (including, without limitation, any
employment or consulting agreement, any agreement not to compete or any confidentiality or
nondisclosure agreement) to which the Employee were, are or may become a party on or at any time
after the date the Employee commenced the Employee’s employment with the Company, or (ii) any
obligation the Employee may otherwise have under applicable law



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to any former employer or to any person to whom the Employee have provided, provide or will
provide consulting services.



At-Will Employment




     The Employee acknowledges that the employment relationship between the Company and the
Employee is at-will, and that the Employee’s employment relationship may be terminated by the
Company or the Employee for any reason or for no reason. However, the Employee agrees to make
reasonable efforts to provide the Company at least two (2) weeks’ written notice prior to
termination of the Employee’s employment. The Company will have no obligation to make any
severance or termination payments to the Employee at the conclusion of the Employee employment with
the Company except as set forth in Schedule 1 under the heading, “Severance Payment.”



     Regardless of the reason the Employee’s employment with the Company terminates, the Employee
will continue to comply with the Confidentiality and Assignment of Inventions and Non-Competition
Agreement contemplated hereby.



Governing Law; Waiver of Jury Trial and Punitive Damages




     This letter agreement shall be governed by and construed in accordance with the internal
substantive laws of the Commonwealth of Massachusetts. EACH OF THE COMPANY AND YOU HEREBY WAIVES
ANY RIGHT TO A JURY TRIAL AND TO CLAIM OR RECOVER PUNITIVE DAMAGES IN EXCESS OF $300,000.



Entire Agreement; Amendment




     This letter agreement (together with Schedule 1 attached hereto and the
Confidentiality and Assignment of Inventions and Non-Competition Agreement contemplated hereby)
sets forth the sole and entire agreement and understanding between the Company and the Employee
with respect to the Employee’s employment with the Company. No prior agreement, whether written or
oral, shall be construed to change or affect the operation of this letter agreement in accordance
with its terms, and any provision of any such prior agreement which conflicts with or contradicts
any provision of this letter agreement is hereby revoked and superseded.



     This letter agreement may be amended or terminated only by a written instrument executed both
by the Employee and the Company.



     We are excited to have the Employee on board as an employee of the Company. Please
acknowledge the Employee’s acceptance of this offer and the terms of this letter agreement by
signing below and returning a copy to me.



	 	 	 	 	 
	 	Sincerely,



3am Labs, Inc.

 	 



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	 	By:  	/s/ Michael Simon
 	 
	 	 	Name:  	Michael Simon 	 
	 	 	Title:  	Chief Executive Officer 	 
	 



I hereby acknowledge that I have had a full and

adequate opportunity to read, understand and discuss

the terms and conditions contained in this letter

agreement prior to signing hereunder.




	 	 	 	 	 
	 	 	 
	/s/ Richard Redding
 	 	 
	Richard Redding 	 	 
	Date: 4/26/2005 	 	 



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Schedule 1




3am Labs, Inc.

Employment Terms — Richard Redding




	 	 	 
	 
	 	 
	Position and Duties:

	 	Vice President of Business Development. In this position
the Employee will work to identify and open channels for
the distribution and sale of the Company’s products
according to the policies of the Company and the direction
of the CEO.
	 
	 	 
	Base Salary:

	 	An annualized salary $145,000, payable in accordance with
the Company’s standard payroll practices.
	 
	 	 
	Performance salary

	 	The Employee will be eligible to receive a bonus as follows:
	compensation:
	 	 
	 
	 	 
	 

	 	Category I:

For each of the first three (3) distribution deals that the
Employee obtains for the Company, and which are entered
into by the Company, during the first year of the
Employee’s employment with the Company (hereafter the
“Eligibility Period”) with large broadband providers or
wireless service providers, each of which provider must
have a minimum of 1 million subscribers and each of which
deal must result in the Company receiving either “net
profits” of at least $25,000 during the Eligibility Period
or within one year thereafter, or $100,000 in revenue from
the deal during the Eligibility Period or within one year
thereafter, the Employee will receive a bonus payment of
$25,000.
	 
	 	 
	 

	 	Category II:

For each of the first three (3) distribution, bundling,
cross promotion or OEM deals that the Employee obtain for
the Company, and which are entered into by the Company,
during the Eligibility Period with a Fortune 100 computer
hardware or Software company, and each of which deal must
result in the Company receiving either “net profits” of at
least $25,000 during the Eligibility Period or within one
year thereafter, or $100,000 in revenue from the deal
during the Eligibility Period or within one year
thereafter, the Employee will receive a bonus payment of
$10,000.
	 
	 	 
	 

	 	In no event will the Employee be eligible for bonuses under
Categories I and II for the same deal or transaction, or
for deals or transactions with the same company. The
Company reserves the right to decline, in its sole
discretion, any transaction or deal and, if it does, no
bonus will be due the Employee for such potential
transaction or deal. For the purpose of this provision,
“net profit” is defined as revenue less any (1) set up
costs (such as third party
















 






	 	 	 
	 

	 	hardware, software and network
operations center costs), (2) fees or commissions paid to
distribution partners, (3) any other third party fees or
commissions associated with, related to or required by, the
transaction or deal. In order for a bonus to be earned,
alt of the conditions of the bonus must be achieved during
the time of the Employee’s employment with the Company and
otherwise during the Eligibility Period.
	 
	 	 
	Stock Option Grant:

	 	Subject to approval by the Company’s Board of Directors,
the Employee will be granted an Option exercisable at fifty
($.50) cents a share for 250,000 shares of the Company’s
common stock (the “Option Shares”) (appropriately adjusted
for any stock split, stock dividend, combination or
recapitalization of the Company’s capital stock) under the
guidelines of the Plan. Subject to the terms and
conditions of the paragraphs set forth under the heading
“Stock Option” in a letter from the Company to the Employee
of even date herewith to which this Schedule 1 is attached,
the Option shall become exercisable, on a cumulative basis,
according to the following schedule assuming that the
Employee remain an employee of the Company at all times
during the applicable vesting period of the Option:






	 	 	 	 	 
	 	 	 	 	Portion of Option Shares Vesting
	 	 	Vesting Date:	 	on such Vesting Date:
	 

	 	May 23, 2006
	 	25% of Option Shares
	 

	 	May 23, 2007
	 	25% of Option Shares
	 

	 	May 23, 2008
	 	25% of Option Shares
	 

	 	May 23, 2009
	 	25% of Option Shares






	 	 	 
	 

	 	Upon termination of the Employee’s relationship with the
Company, the Employee may exercise the Option, to the
extent then exercisable, but only for the limited period
of time set forth in the Plan. For purposes of the
preceding sentence, the Employee’s relationship with the
Company shall terminate on the date that the Employee is
not an employee of the Company.
	 
	 	 
	Benefits:

	 	The Employee shall be entitled to twenty (20) days’
vacation each calendar year. Any vacation shall be
taken at the reasonable and mutual convenience of the
Company and the Employee.
	 
	 	 
	 

	 	The Employee shall be entitled to enroll in the Company
sponsored health insurance plan either as an individual
or as a family with the Employee reimbursing the Company
20% of the premium paid by the Company for such health
insurance plan.
	 
	 	 
	Severance Payment

	 	In the event the Employee’s employment is terminated by
the Company other than “for cause”, within the first
twelve months






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	 	after commencement of the Employee’s
employment with the Company, then the Employee will be
entitled to receive a severance payment equal to three
(3) months of the Employee’s base salary.
Notwithstanding the above, in the event the Employee’s
employment is terminated by the Company other than “for
cause” (i) at the time of, or any time following, an
“acquisition of the Company,” or, (ii) after the first
anniversary of the commencement of the Employee’s
employment with the Company, or, (iii) within six months
after appointment of a new CEO, or, (iv) for other
reasons other than “for cause,” then the Employee will
be entitled to receive a severance payment equal to six
(6) months of the Employee’s base salary. In no event
shall the Company be obligated to pay the Employee a
severance payment greater than six (6) months of the
Employee’s base salary or any severance payment other
than as expressly set forth above.
	 
	 	 
	 

	 	For the purpose of this provision, an “acquisition of
the Company” shall be strictly limited to the (1) the
sale of all or substantially all of the assets of the
Company to other than a current shareholder, (2) the
acquisition of in excess of fifty (50%) percent of the
voting equity of the Company by a person or company not
presently a shareholder of the Company, or (3) the
merger or consolidation of the Company with another
company that was neither a subsidiary or affiliate with
the Company just prior to the time of the merger or
consolidation. Further for the purpose of this
provision, “for cause” is defined as any of the
following: (1) insubordination or disregard of
directives of the Company’s Board of Directors or of the
Chief Executive Officer of the Company (or any other the
Company officer to whom the Employee report); (2)
commission of a willful act which constitutes a breach
of the Employee’s duty of loyalty to the Company; (3)
commission of a willful act of dishonesty in the course
of the Employee’s duties with the Company which
significantly injures the Company; (4) engagement in
gross or persistent misconduct injurious to the Company,
its stockholders or affiliates; (5) conviction of a
crime of moral turpitude or of a felony; or (6) chronic
alcoholism or drug abuse.
	 
	 	 
	Singing Bonus

	 	Upon completion of 30 days of employment with the
Company, the Employee will receive a one-time payment of
$5,000.





I have read the foregoing three pages of Schedule 1 and I accept the provisions of Schedule 1.




	 	 	 	 	 
	 	 	 
	/s/ Richard Redding
 	 	 
	Richard Redding 	 	 
	 


Date: 4/26/2005





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