Document:

Exhibit 10.10a

 

EMPLOYMENT AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (this “Agreement”), dated as of August 31,
2010, is entered into by and between Demand Media, Inc., a Delaware
corporation (the “Company”) and Shawn Colo (the “Executive”).

 

WHEREAS,
the Company desires to continue to employ the Executive and to enter into an
agreement embodying the terms of such employment; and

 

WHEREAS,
the Executive desires to accept such continuation of employment with the
Company, subject to the terms and conditions of this Agreement.

 

NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

 

1.                                       Employment
Period.  Subject to the provisions for
earlier termination hereinafter provided, the Executive’s employment hereunder
shall be for a term commencing on the Effective Date and ending on the fourth
(4th) anniversary
of the Effective Date (the “Employment Period”).  For purposes of this Agreement, “Effective
Date” shall mean the date of the closing of the Company’s initial public
offering of shares of its common stock. 
The Executive’s employment hereunder is terminable at will by the
Company or by the Executive at any time (for any reason or for no reason),
subject to the provisions of Section 4 hereof.  This Agreement shall become effective on the
Effective Date and, in the event the Effective Date does not occur on or prior
to March 31, 2011 (or such later date as the Company and Executive agree
in writing), then this Agreement shall terminate on such date and shall be of
no force or effect.

 

2.                                       Terms of
Employment.

 

(a)                                  Position and
Duties.

 

(i)                                     During the
Employment Period, the Executive shall serve as the Company’s Executive Vice
President and Head of Mergers & Acquisitions, reporting to the Chief
Executive Officer or his or her designee, and shall perform such duties as are
usual and customary for such position. 
At the Company’s request, the Executive shall serve the Company and/or
its subsidiaries and affiliates in other capacities in addition to the
foregoing consistent with the Executive’s roles as Executive Vice President and
Head of Mergers & Acquisitions of the Company.  In the event that the Executive, during the
Employment Period, serves in any one or more of such additional capacities, the
Executive’s compensation shall not be increased beyond that specified in Section 2(b)
hereof.  In addition, in the event the
Executive’s service in one or more of such additional capacities is terminated,
the Executive’s compensation, as specified in Section 2(b) hereof,
shall not be diminished or reduced in any manner as a result of such
termination provided that the Executive otherwise remains employed under the
terms of this Agreement.

 

(ii)                                  During the
Employment Period, and excluding any periods of vacation and sick leave to
which the Executive may be entitled, the Executive agrees to devote the
Executive’s full business time and attention to the business and affairs of the
Company.  Notwithstanding the foregoing,
during the Employment Period, it shall not be 

 

 

a violation of this Agreement for the Executive to
engage in any of the following activities: (A) serve on boards, committees
or similar bodies of charitable or nonprofit organizations, (B) fulfill
limited teaching, speaking and writing engagements on a volunteer basis, and/or
(C) holding economic interests in companies in which the Executive does
not take an operating role (not to exceed a 5% interest in any company), in
each case, so long as such activities do not, individually or in the aggregate,
materially interfere or conflict with the performance of the Executive’s duties
and responsibilities under this Agreement.

 

(iii)                               During the
Employment Period, the Executive shall perform the services required by this
Agreement at the Company’s principal offices located in Santa Monica,
California, except for travel to other locations as may be necessary to fulfill
the Executive’s duties and responsibilities hereunder.

 

(b)                                 Compensation,
Benefits, Etc.

 

(i)                                     Base Salary.  During the Employment Period, the Executive
shall receive a base salary initially set at the rate in effect as of the
Effective Date, and increased on January 1, 2011 to a rate of $250,000 per
annum (the “Base Salary”).  The
Base Salary shall be reviewed annually by the Compensation Committee (the “Compensation
Committee”) of the Board (the “Board”) and may be increased from
time to time by the Compensation Committee in its sole discretion.  The Base Salary shall be paid in installments
in accordance with the Company’s applicable payroll practices, as in effect
from time to time, but no less often than monthly.

 

(ii)                                  Annual Bonus.  In addition to the Base Salary, the Executive
shall be eligible to earn, for each fiscal year of the Company ending during
the Employment Period, a discretionary cash performance bonus (an “Annual
Bonus”) under the Company’s bonus plan or program applicable to senior
executives.  The Executive’s target
Annual Bonus for 2010 shall be set at the level in effect as of the Effective
Date and shall, for fiscal years 2011 and later during the Employment Period,
be set at fifty percent (50%) of the Base Salary actually paid for such year,
but the actual amount of the Annual Bonus shall be determined on the basis of
the attainment of Company performance metrics and/or individual performance
objectives, in each case, as established and approved by the Board or the
Compensation Committee (or their designee) in its sole discretion. Payment of
any Annual Bonus(es), to the extent any Annual Bonus(es) become payable, will
be contingent upon the Executive’s continued employment through the applicable
payment date, which shall occur on the date on which annual bonuses are paid
generally to the Company’s similarly situated executives.

 

(iii)                               Stock Option
Award.  Subject to adoption by the
Board and approval by the Company’s stockholders of the 2010 Incentive Award Plan (the “Plan”),
the Company shall grant to the Executive, as soon as practicable after the
execution of this Agreement (which grant date, for the avoidance of doubt, may
precede the Effective Date) (the “Grant Date”), a nonqualified option to
purchase one hundred thousand (100,000) shares of the Company’s common stock
(the “Stock Option”) with
an exercise price equal $9.00 per share. 
Subject to Section 4(a) hereof, the Stock Option shall vest
and become exercisable in substantially equal installments (rounded up to the
nearest 

 

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whole share) on each monthly anniversary of the
Effective Date occurring over the four (4)-year period immediately following
the Effective Date, subject to the Executive’s continued employment with the
Company through such date.  If the
Effective Date does not occur on or prior to March 31, 2011 for any
reason, then, notwithstanding anything to the contrary, the Stock Option shall
terminate and be forfeited, and the Company shall have no further obligations
with respect thereto.  The terms and
conditions of the Stock Option shall, in a manner consistent with this Section 2(b)(iii),
be set forth in a separate award agreement in a form prescribed by the Company
(the “Stock Option Agreement”), to be entered into by the Company and
the Executive, which shall evidence the grant of the Stock Option.  The Stock Option shall be governed in all
respects by the terms and conditions of the Plan.

 

(iv)                              Incentive,
Savings and Retirement Plans.  During the Employment Period, the Executive
shall be eligible to participate in all other incentive plans, practices,
policies and programs, and all savings and retirement plans, practices,
policies and programs, in each case that are available generally to similarly
situated executives of the Company.

 

(v)                                 Welfare Benefit
Plans.  During the Employment Period,
the Executive and the Executive’s dependents shall be eligible to participate
in the welfare benefit plans, practices, policies and programs (including, as
applicable, medical, dental, disability, employee life, group life and
accidental death insurance plans and programs) maintained by the Company for
its similarly situated executives.

 

(vi)                              Expenses.  During the Employment Period, the Executive shall
be entitled to receive prompt reimbursement for all reasonable business
expenses incurred by the Executive in accordance with the policies, practices
and procedures of the Company provided to similarly situated executives of the
Company.

 

(vii)                           Fringe Benefits.  During the Employment Period, the Executive
shall be entitled to such fringe benefits and perquisites as are provided by
the Company to its similarly situated executives from time to time, in
accordance with the policies, practices and procedures of the Company, and
shall receive such additional fringe benefits and perquisites as the Company
may, in its discretion, from time-to-time provide.  Nothing contained in Sections 2(b)(iv)-(v) hereof
or this Section 2(b)(vii) shall, or shall be construed to, obligate
the Company to adopt or maintain any incentive, savings, retirement, welfare,
fringe benefit or other plan(s) or program(s) at any time.

 

(viii)                        Vacation.  During the Employment Period, the Executive
shall not be entitled to a fixed number of paid vacation, personal or sick days
per year.  As a salaried employee, the
Company expects the Executive to use the Executive’s judgment to take time off
from work for vacation or other personal time in a manner consistent with
getting the Executive’s work done in a timely fashion, providing excellent
service to the Company’s customers and partners and avoiding inconveniencing
the Executive’s co-workers.  To the
extent the Executive has an existing balance of accrued, unused vacation as of
the Effective Date, that time will be applied to the Executive’s absences until
it is exhausted.

 

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3.                                       Termination of
Employment.

 

(a)                                  Death or
Disability.  The
Executive’s employment shall terminate automatically upon the Executive’s death
during the Employment Period.  Either the
Company or the Executive may terminate the Executive’s employment in the event
of the Executive’s Disability during the Employment Period.  For purposes of this Agreement, “Disability”
shall mean a disability as determined under the Company’s applicable long-term
disability plan that prevents the Executive from performing the Executive’s
duties under this Agreement (even with a reasonable accommodation by the
Company) for a period of six (6) months or more or, if no such plan
applies, as determined in the reasonable discretion of the Company.

 

(b)                                 Cause.  The Company may terminate the Executive’s
employment during the Employment Period for Cause or without Cause.  For purposes of this Agreement, “Cause”
shall have the meaning set forth in the Plan.

 

(c)                                  Termination by
the Executive.  The
Executive’s employment may be terminated by the Executive for any reason,
including with Good Reason in connection with a Change in Control (as defined
in the Plan).  For purposes of this
Agreement, “Good Reason” shall mean the occurrence of any one or more of
the following events in connection with a Change in Control, in any case,
without the Executive’s prior written consent, unless the Company fully
corrects the circumstances constituting Good Reason (provided such
circumstances are capable of correction) as provided below:

 

(i)                                     a demotion or
material diminution of the Executive’s position, authority, duties or
responsibilities (other than any
insubstantial action not taken in bad faith and which is promptly remedied by
the Company upon notice by the Executive); provided that “Good Reason” does not
include a change in title, authority, duties and/or responsibilities following
a Change in Control if (A) the Executive’s new title is
that of a senior officer of the entity surviving such Change in Control (or, if
applicable, its parent company if such entity has a parent company) reporting
directly to an executive officer of the entity surviving such Change in Control
(or, if applicable, its parent company, if such entity has a parent company),
and the Executive’s authority,
duties and responsibilities are commensurate with such title or (B) (1) the
entity surviving such Change in Control (or, if applicable, its parent company
if such entity has a parent company) continues to operate the Company’s
principal businesses as a separate unit, division or subsidiary or combines the
Company’s principal businesses with one of its existing units, divisions
or subsidiaries and (2) the Executive’s new title is
that of a senior officer of such unit, division or subsidiary reporting
directly to an executive officer of such unit, division or subsidiary (or to an
executive officer of the entity surviving the Change in Control or parent company
thereof) and (in either case), the Executive’s authority, duties and
responsibilities are commensurate with such title and similar in scope (with
respect to such unit, division or subsidiary) to the authority, duties and
responsibilities of the Executive prior to the Change in Control;

 

(ii)                                  a requirement
that the Executive report to work more than twenty (20) miles from the Company’s
Principal Location (not including normal business travel required of the
Executive’s position) or, to the extent such requirement would not constitute a
material change in the geographic location at which the Executive must 

 

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perform services under this Agreement within the
meaning of Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”), such higher number of miles from the Company’s Principal
Location as would constitute a material change in the geographic location at
which the Executive must perform services under this Agreement within the
meaning of Section 409A of the Code;

 

(iii)                             a material
reduction in the Executive’s base salary; or

 

(iv)                              a material
breach by the Company of its obligations hereunder.

 

Notwithstanding
the foregoing, the Executive will not be deemed to have resigned for Good Reason
unless (1) the Executive provides the Company with written notice setting
forth in reasonable detail the facts and circumstances claimed by the Executive
to constitute Good Reason within sixty (60) days after the date of the
occurrence of any event that the Executive knows or should reasonably have
known to constitute Good Reason, (2) the Company fails to cure such acts
or omissions within thirty (30) days following its receipt of such notice, and (3) the
effective date of the Executive’s termination for Good Reason occurs no later
than sixty (60) days after the expiration of the Company’s cure period.

 

(d)                                 Notice of
Termination.  Any
termination by the Company for Cause, or by the Executive for Good Reason,
shall be communicated by a Notice of Termination to the other parties hereto
given in accordance with Section 10(b) hereof.  For purposes of this Agreement, a “Notice
of Termination” means a written notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) to the
extent applicable, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s employment under
the provision so indicated and (iii) if the Date of Termination (as
defined below) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than sixty (60) days after the
giving of such notice).  The failure by
the Executive or the Company to set forth in the Notice of Termination any fact
or circumstance which contributes to a showing of Good Reason or Cause shall
not waive any right of the Executive or the Company, respectively, hereunder or
preclude the Executive or the Company, respectively, from asserting such fact
or circumstance in enforcing the Executive’s or the Company’s rights hereunder.

 

(e)                                  Termination of
Offices and Directorships.  Upon
termination of the Executive’s employment for any reason, unless otherwise
specified in a written agreement between the Executive and the Company, the Executive
shall be deemed to have resigned from all offices, directorships, and other
employment positions if any, then held with the Company, and shall take all
actions reasonably requested by the Company to effectuate the foregoing.

 

4.                                       Obligations of
the Company upon Termination.

 

(a)                                  Without Cause,
For Good Reason, Death or Disability.  Subject to Section 4(d) hereof, if
the Executive incurs a “separation from service” from the Company (within the
meaning of Section 409A(a)(2)(A)(i) of the Code, and Treasury
Regulation Section 1.409A-1(h)) (a “Separation from Service”)
during the Employment Period (such date, the “Date of Termination”) by
reason of (1) a termination of the Executive’s employment by the Company
without Cause; (2) a termination of the Executive’s employment by the
Executive for Good 

 

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Reason;
or (3) a termination of the Executive’s employment by reason of the
Executive’s death or Disability (each of (1), (2) and (3), a “Qualifying
Termination”):

 

(i)                                     The Executive
(or the Executive’s estate or beneficiaries, if applicable) shall be paid, in a
single lump-sum payment on the date of the Executive’s termination of
employment, the aggregate amount of the Executive’s earned but unpaid Base
Salary and accrued but unpaid vacation pay (if any) through the date of such
termination (the “Accrued Obligations”), in each case, to the extent not
previously paid.

 

(ii)                                  In addition,
subject to Section 4(d) hereof and the Executive’s (or the Executive’s
estate’s or beneficiaries’, if applicable) timely execution and non-revocation
of a Release (as described below), the Executive (or the Executive’s estate or
beneficiaries, if applicable) shall be paid:

 

(A)                              an amount equal
to six (6) months’ of the Base Salary in effect on the Date of Termination
(the “Continuation Amount”), payable in substantially equal installments
(the “Installments”) in accordance with the Company’s normal payroll
procedures during the period commencing on the Date of Termination and ending
on the six (6)-month anniversary of the Date of Termination; provided, however,
that no payments under this Section 4(a)(ii)(A) shall be made prior
to the first payroll date occurring on or after the thirtieth (30th) day following the Date of
Termination (such payroll date, the “First Payroll Date”) (with amounts
otherwise payable prior to the First Payroll Date paid on the First Payroll
Date without interest thereon); provided, further, that in no
event shall any of the Installments be paid later than March 15th of the year following that in which the Date
of Termination occurs, and any of Installments that would otherwise be paid
after such March 15th shall instead be paid on such March 15th; and

 

(B)                                any unpaid
Annual Bonus to which the Executive would have become entitled for any fiscal
year of the Company that ends on or before the Date of Termination had the
Executive remained employed through the payment date, payable in a single
lump-sum payment on the date on which annual bonuses are paid to the Company’s
senior executives generally for such calendar year, but in no event later than March 15th of the calendar year immediately following the
calendar year in which the Date of Termination occurs, with the actual date
within such period determined by the Company in its sole discretion.

 

(iii)                               In addition,
subject to Section 4(d) hereof and conditioned upon the Executive’s
timely execution and non-revocation of a Release, during the period commencing
on the Date of Termination and ending on the six (6)-month anniversary of the
Date of Termination or, if earlier, the date on which the Executive becomes
eligible for coverage under the group health plan of a subsequent employer (of
which eligibility the Executive hereby agrees to give prompt notice to the Company)
(in any case, the “COBRA Period”), subject to the Executive’s valid
election to continue healthcare coverage under Section 4980B of the Code
and the regulations thereunder, the Company 

 

6

 

shall continue to provide the Executive and the
Executive’s eligible dependants with coverage under its group health plans at
the same levels and the same cost to the Executive as would have applied if the
Executive’s employment had not been terminated based on the Executive’s
elections in effect on the Date of Termination), provided,  however, that (1) if any
plan pursuant to which such benefits are provided is not, or ceases prior to
the expiration of the period of continuation coverage to be, exempt from the
application of Section 409A of the Code under Treasury Regulation Section 1.409A-1(a)(5),
or (2) the Company is otherwise unable to continue to cover the Executive
under its group health plans, then, in either case, an amount equal to each
remaining Company subsidy shall thereafter be paid to the Executive as
currently taxable compensation in substantially equal monthly installments over
the continuation coverage period (or the remaining portion thereof).

 

The
payments and benefits described in the preceding Sections 4(a)(ii) and (iii) are
referred to herein as the “Severance.” 
Notwithstanding the foregoing, it shall be a condition to the Executive’s
(or the Executive’s estate’s or beneficiaries’, if applicable) right to receive
the Severance that the Executive (or the Executive’s estate or beneficiaries,
if applicable) execute and deliver to the Company an effective release of
claims in substantially the form attached hereto as Exhibit A (the “Release”)
within twenty-one (21) days (or, to the extent required by law, forty-five (45)
days) following the Date of Termination and that the Executive (or the
Executive’s estate or beneficiaries, if applicable) not revoke such Release
during any applicable revocation period.

 

(b)                                 For Cause,
Without Good Reason or Other Terminations.  If the Company terminates the Executive’s
employment for Cause, the Executive terminates the Executive’s employment
without Good Reason, or the Executive’s employment terminates for any other
reason not enumerated in this Section 4, in any case, during the
Employment Period, the Company shall pay to the Executive the Accrued
Obligations in cash within thirty (30) days after the Date of Termination (or
by such earlier date as may be required by applicable law).

 

(c)                                  Equity Vesting
in Connection with a Change in Control.  In addition to any payments or benefits due
to the Executive under Section 4(a) above (if any), subject to and
conditioned upon the Executive’s timely execution and non-revocation of a
Release, if the Executive’s employment is terminated by reason of a Qualifying
Termination and a Change in Control (A) occurs on or within ninety (90)
days after the Date of Termination or (B) has occurred within one (1) year
before the Date of Termination, all outstanding compensatory equity awards that
have not yet vested shall conditionally vest and, as applicable, become
exercisable on the later of the Date of Termination and the date of such Change
in Control (and such vesting shall become unconditional upon such execution and
non-revocation of a Release); provided, however, that if the
Executive fails to timely execute or revokes the Release, all such
conditionally vested awards (and any shares received in respect of such awards)
shall be forfeited upon such failure or revocation (subject to repayment by the
Company to the Executive of any amounts (if any) paid by the Executive with
respect to shares underlying such conditionally vested awards.  For the avoidance of doubt, if a Qualifying
Termination occurs prior to a Change in Control, all outstanding, unvested
compensatory equity awards that would otherwise terminate on the Date of
Termination shall remain outstanding and eligible to vest solely upon a Change
in Control occurring within ninety (90) days after the Date of Termination (but
shall not otherwise 

 

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vest
following the Date of Termination) and shall terminate on the ninetieth (90th) day following the Date of
Termination if a Change in Control has not occurred on or prior to such
ninetieth (90th) day (or such
earlier expiration date applicable to the award (other than due to a
termination of employment)).

 

(d)                                 Six-Month Delay.  Notwithstanding anything to the contrary in
this Agreement, no compensation or benefits, including without limitation any
severance payments or benefits payable under Section 4 hereof, shall be
paid to the Executive during the six (6)-month period following the Executive’s
“separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of
the Code) if the Company determines that paying such amounts at the time or
times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of
the Code.  If the payment of any such
amounts is delayed as a result of the previous sentence, then on the first
business day following the end of such six (6)-month period (or such earlier
date upon which such amount can be paid under Section 409A of the Code
without resulting in a prohibited distribution, including as a result of the
Executive’s death), the Company shall pay the Executive a lump-sum amount equal
to the cumulative amount that would have otherwise been payable to the
Executive during such period.

 

(e)                                  Exclusive
Benefits.  Except as
expressly provided in this Section 4 and subject to Section 5 hereof,
the Executive shall not be entitled to any additional payments or benefits upon
or in connection with the Executive’s termination of employment.

 

(f)                                    Equity Award
Agreements.  For the avoidance of doubt, nothing contained in this Agreement is
intended to result in any vesting terms that are less favorable to the
Executive than those contained in any applicable equity award agreement and, to
the extent that the vesting terms contained in any such award agreement are
more favorable to the Executive than those provided herein, including, without
limitation, this Section 4, the terms of such award agreement shall
control.

 

5.                                       Non-Exclusivity
of Rights.  Amounts
which are vested benefits or which the Executive is otherwise entitled to
receive under any plan, policy, practice or program of or any contract or
agreement with the Company at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract
or agreement except as explicitly modified by this Agreement.

 

6.                                       Excess
Parachute Payments, Limitations on Payments.

 

(a)                                  Best Pay Cap.
Notwithstanding any other provision of this Agreement, in the event that any
payment or benefit received or to be received by the Executive (including any
payment or benefit received in connection with a termination of the Executive’s
employment, whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement) (all such payments and benefits, including the
payments and benefits under Section 4 hereof, being hereinafter referred
to as the “Total Payments”) would be subject (in whole or part), to
excise tax imposed under Section 4999 of the Code (the “Excise Tax”),
then, after taking into account any reduction in the Total Payments provided by
reason of Section 280G of the Code in such other plan, arrangement or
agreement, the cash severance payments under this Agreement shall first be
reduced, and the noncash severance payments hereunder shall thereafter be
reduced, to the extent necessary so that no portion of the Total Payments is
subject to the Excise Tax but 

 

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only
if (A) the net amount of such Total Payments, as so reduced (and after
subtracting the net amount of federal, state and local income taxes on such
reduced Total Payments and after taking into account the phase out of itemized
deductions and personal exemptions attributable to such reduced Total Payments)
is greater than or equal to (B) the net amount of such Total Payments
without such reduction (but after subtracting the net amount of federal, state
and local income taxes on such Total Payments and the amount of Excise Tax to
which the Executive would be subject in respect of such unreduced Total
Payments and after taking into account the phase out of itemized deductions and
personal exemptions attributable to such unreduced Total Payments).  The Total Payments shall be reduced in the
following order: (A) reduction of any cash severance payments otherwise
payable to the Executive that are exempt from Section 409A of the Code; (B) reduction
of any other cash payments or benefits otherwise payable to the Executive that
are exempt from Section 409A of the Code, but excluding any payments
attributable to any acceleration of vesting or payments with respect to any
equity award that are exempt from Section 409A of the Code; (C) reduction
of any other payments or benefits otherwise payable to the Executive on a
pro-rata basis or such other manner that complies with Section 409A of the
Code, but excluding any payments attributable to any acceleration of vesting
and payments with respect to any equity award that are exempt from Section 409A
of the Code; and (D) reduction of any payments attributable to any
acceleration of vesting or payments with respect to any equity award that are
exempt from Section 409A of the Code, in each case beginning with payments
that would otherwise be made last in time.

 

(b)                                 Certain
Exclusions. For purposes of determining whether and the extent
to which the Total Payments will be subject to the Excise Tax, (A) no
portion of the Total Payments the receipt or enjoyment of which the Executive
shall have waived at such time and in such manner as not to constitute a “payment”
within the meaning of Section 280G(b) of the Code shall be taken into
account; (B) no portion of the Total Payments shall be taken into account
which, in the written opinion of an independent, nationally recognized
accounting firm (the “Accounting Firm”), does not constitute a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code
(including by reason of Section 280G(b)(4)(A) of the Code) and, in
calculating the Excise Tax, no portion of such Total Payments shall be taken
into account which, in the opinion of the Accounting Firm, constitutes
reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of
the Code, in excess of the Base Amount (as defined in Section 280G(b)(3) of
the Code) allocable to such reasonable compensation; and (iii) the value
of any non cash benefit or any deferred payment or benefit included in the
Total Payments shall be determined by the Accounting Firm in accordance with
the principles of Sections 280G(d)(3) and (4) of the Code.

 

7.                                       Confidential
Information and Non-Solicitation.  The Executive hereby acknowledges that the
Executive has previously entered into an agreement with the Company containing
confidentiality and other protective covenants (the “Confidentiality
Agreement”) and that the Executive remains bound by the terms and
conditions of the Confidentiality Agreement.

 

8.                                       Representations.  The Executive hereby represents and warrants
to the Company that (a) the Executive is entering into this Agreement
voluntarily and that the performance of the Executive’s obligations hereunder
will not violate any agreement between the Executive and any other person,
firm, organization or other entity, and (b) the Executive is not bound by
the terms of any agreement with any previous employer or other party to refrain
from

 

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competing,
directly or indirectly, with the business of such previous employer or other
party that would be violated by the Executive’s entering into this Agreement
and/or providing services to the Company pursuant to the terms of this
Agreement.

 

9.                                       Successors.

 

(a)                                  This Agreement
is personal to the Executive and, without the prior written consent of the
Company, shall not be assignable by the Executive otherwise than by will or the
laws of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

 

(b)                                 This Agreement
shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

 

(c)                                  The Company
will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform it
if no such succession had taken place. 
As used in this Agreement, “Company” shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of law,
or otherwise.

 

10.                                 Miscellaneous.

 

(a)                                  Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without
reference to principles of conflict of laws. 
The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect.

 

(b)                                 Notices.  All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

 

If to the Executive:  at the Executive’s most recent address on the
records of the Company.

 

If to the Company:

 

Demand
Media, Inc.

1333
Second Street, Ste. 100

Santa Monica, CA 90401

Attn:
General Counsel

 

10

 

with
a copy to:

 

Latham &
Watkins LLP

355 South Grand Ave. 

Los Angeles, CA 90071-1560

Attn: Alex Voxman

 

or
to such other address as either party shall have furnished to the other in
writing in accordance herewith.  Notice
and communications shall be effective when actually received by the addressee.

 

(c)                                  Sarbanes-Oxley
Act of 2002. 
Notwithstanding anything herein to the contrary, if the Company
determines, in its good faith judgment, that any transfer or deemed transfer of
funds hereunder is likely to be construed as a personal loan prohibited by Section 13(k) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and
the rules and regulations promulgated thereunder, then such transfer or
deemed transfer shall not be made to the extent necessary or appropriate so as
not to violate the Exchange Act and the rules and regulations promulgated
thereunder.

 

(d)                                 Section 409A
of the Code.

 

(i)  To the extent applicable, this Agreement
shall be interpreted in accordance with Section 409A of the Code and
Department of Treasury regulations and other interpretive guidance issued
thereunder.  Notwithstanding any
provision of this Agreement to the contrary, if the Company determines that any
compensation or benefits payable under this Agreement may be subject to Section 409A
of the Code and related Department of Treasury guidance, the Company shall work
in good faith with the Executive to adopt such amendments to this Agreement or
adopt other policies and procedures (including amendments, policies and
procedures with retroactive effect), or take any other actions, that the
Company determines are necessary or appropriate to avoid the imposition of
taxes under Section 409A of the Code, including without limitation,
actions intended to (i) exempt the compensation and benefits payable under
this Agreement from Section 409A of the Code, and/or (ii) comply with
the requirements of Section 409A of the Code and related Department of
Treasury guidance; provided, however, that this Section 10(d) shall not create an
obligation on the part of the Company to adopt any such amendment, policy or
procedure or take any such other action, nor shall the Company have any
liability for failing to do so.

 

(ii)  Any right to a series of installment
payments pursuant to this Agreement is to be treated as a right to a series of
separate payments.  To the extent
permitted under Section 409A of the Code, any separate payment or benefit
under this Agreement or otherwise shall not be deemed “nonqualified deferred
compensation” subject to Section 409A of the Code and Section 4(d) hereof
to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4),
Section 1.409A-1(b)(9) or any other applicable exception or provision
of Section 409A of the Code.

 

(iii)  To the extent that any payments or
reimbursements provided to the Executive under this Agreement, including,
without limitation, pursuant to Section 2(b)(vii) hereof, are deemed
to constitute compensation to the Executive to which Treasury Regulation 

 

11

 

Section 1.409A-3(i)(1)(iv) would
apply, such amounts shall be paid or reimbursed reasonably promptly, but not
later than December 31 of the year following the year in which the expense
was incurred.  The amount of any such
payments eligible for reimbursement in one year shall not affect the payments
or expenses that are eligible for payment or reimbursement in any other taxable
year, and the Executive’s right to such payments or reimbursement of any such
expenses shall not be subject to liquidation or exchange for any other benefit.

 

(e)                                  Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.

 

(f)                                    Withholding.  The Company may withhold from any amounts
payable under this Agreement such Federal, state, local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.

 

(g)                                 No Waiver.  The Executive’s or the Company’s failure to
insist upon strict compliance with any provision of this Agreement or the
failure to assert any right the Executive or the Company may have hereunder,
including, without limitation, the right of the Executive to terminate
employment for Good Reason pursuant to Section 3(c) hereof, shall not
be deemed to be a waiver of such provision or right or any other provision or
right of this Agreement.

 

(h)                                 Entire
Agreement.  As of the
Effective Date, this Agreement, together with the Confidentiality Agreement,
any prior equity award agreements, and the Stock Option Agreement, constitutes
the final, complete and exclusive agreement between the Executive and the
Company with respect to the subject matter hereof and replaces and supersedes
any and all other agreements, offers or promises, whether oral or written, by
any member of the Company and its subsidiaries and affiliates, or
representative thereof.  The Executive
agrees that the Employment Agreement dated as of April 18, 2006 shall be
terminated and will be of no further force or effect from and after the
Effective Date.  In the event that the
Effective Date does not occur prior to March 31, 2011 (or such later date
as Executive and the Company agree in writing), this Agreement (including,
without limitation, the immediately preceding sentence) shall have no force or
effect.

 

(i)                                     Amendment.  No amendment or other modification of this
Agreement shall be effective unless made in writing and signed by the parties
hereto.

 

(j)                                     Counterparts.  This Agreement and any agreement referenced
herein may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original but which together shall constitute one and
the same instrument.

 

[SIGNATURE PAGE FOLLOWS]

 

12

 

IN WITNESS WHEREOF, the Executive has hereunto set
the Executive’s hand and, pursuant to the authorization from the Board, the
Company has caused these presents to be executed in its name on its behalf, all
as of the day and year first above written.

 

 

	
   

  	
  DEMAND
  MEDIA, INC.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard Rosenblatt

  
	
   

  	
   

  	
  Name:

  	
  Richard
  Rosenblatt

  
	
  

  	
   

  	
  Title:

  	
  Chairman
  & CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
  “EXECUTIVE”

  
	
  /s/
  Shawn Colo

  
	
   

  	
  Shawn
  Colo

  

 

13

 

EXHIBIT A

 

GENERAL RELEASE

 

For
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the undersigned does hereby release and forever discharge the “Releasees”
hereunder, consisting of Demand Media, Inc., a Delaware corporation (the “Company”)
and each of its partners, subsidiaries, associates, affiliates, successors,
heirs, assigns, agents, directors, officers, employees, representatives,
lawyers, insurers, and all persons acting by, through, under or in concert with
them, or any of them, of and from any and all manner of action or actions,
cause or causes of action, in law or in equity, suits, debts, liens, contracts,
agreements, promises, liability, claims, demands, damages, losses, costs,
attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed
or contingent (hereinafter called “Claims”), which the undersigned now
has or may hereafter have against the Releasees, or any of them, by reason of any
matter, cause, or thing whatsoever from the beginning of time to the date
hereof.  The Claims released herein include, without limiting the
generality of the foregoing, any Claims in any way arising out of, based upon,
or related to the employment or termination of employment of the undersigned by
the Releasees, or any of them; any alleged breach of any express or implied
contract of employment; any alleged torts or other alleged legal restrictions
on Releasees’ right to terminate the employment of the undersigned; and any
alleged violation of any federal, state or local statute or ordinance
including, without limitation, Title VII of the Civil Rights Act of 1964, the
Age Discrimination In Employment Act, the Americans With Disabilities Act, and
the California Fair Employment and Housing Act. Notwithstanding the foregoing,
this general release (the “Release”) shall not operate to release any
rights or claims of the undersigned (i) to payments or benefits under Section 4(a) of
that certain Employment Agreement, dated as of
                  ,
2010, between Demand Media, Inc. and the undersigned (the “Employment
Agreement”), whichever is applicable to the payments and benefits provided
in exchange for this Release, (ii) to payments or benefits under any equity
award agreement between the undersigned and the Company, (iii) with
respect to Section 2(b)(vi) of the Employment Agreement, (iv) to
accrued or vested benefits the undersigned may have, if any, as of the date
hereof under any applicable plan, policy, practice, program, contract or
agreement with the Company, or (v) to any Claims, including claims for
indemnification and/or advancement of expenses, arising under any
indemnification agreement between the undersigned and the Company or under the
bylaws, certificate of incorporation of other similar governing document of the
Company.

 

THE
UNDERSIGNED ACKNOWLEDGES THAT THE EXECUTIVE HAS BEEN ADVISED BY LEGAL COUNSEL
AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542,
WHICH PROVIDES AS FOLLOWS:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.”

 

A-1

 

THE
UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY
RIGHTS THE EXECUTIVE MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER
STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.

 

IN
ACCORDANCE WITH THE OLDER WORKERS BENEFIT PROTECTION ACT OF 1990, THE
UNDERSIGNED IS HEREBY ADVISED AS FOLLOWS:

 

(A)                              THE EXECUTIVE
HAS THE RIGHT TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS RELEASE;

 

(B)                                THE EXECUTIVE
HAS TWENTY-ONE (21) DAYS TO CONSIDER THIS RELEASE BEFORE SIGNING IT; AND

 

(C)                                THE EXECUTIVE
HAS SEVEN (7) DAYS AFTER SIGNING THIS RELEASE TO REVOKE THIS RELEASE, AND
THIS RELEASE WILL BECOME EFFECTIVE UPON THE EXPIRATION OF THAT REVOCATION
PERIOD.

 

The
undersigned represents and warrants that there has been no assignment or other
transfer of any interest in any Claim which the Executive may have against
Releasees, or any of them, and the undersigned agrees to indemnify and hold
Releasees, and each of them, harmless from any liability, Claims, demands,
damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of
them, as the result of any such assignment or transfer or any rights or Claims
under any such assignment or transfer.  It is the intention of the parties
that this indemnity does not require payment as a condition precedent to
recovery by the Releasees against the undersigned under this indemnity.

 

The
undersigned agrees that if the Executive hereafter commences any suit arising
out of, based upon, or relating to any of the Claims released hereunder or in
any manner asserts against Releasees, or any of them, any of the Claims
released hereunder, then the undersigned agrees to pay to Releasees, and each
of them, in addition to any other damages caused to Releasees thereby, all
attorneys’ fees incurred by Releasees in defending or otherwise responding to
said suit or Claim.

 

The
undersigned further understands and agrees that neither the payment of any sum
of money nor the execution of this Release shall constitute or be construed as
an admission of any liability whatsoever by the Releasees, or any of them, who
have consistently taken the position that they have no liability whatsoever to
the undersigned.

 

IN
WITNESS WHEREOF, the undersigned has executed this Release this
         day of
                      ,
        .

 

	
   

  	
   

  

 

A-2Exhibit 10.11a

 

EMPLOYMENT AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (this “Agreement”), dated as of October 2,
2010, is entered into by and between Demand Media, Inc., a Delaware
corporation (the “Company”) and Larry Fitzgibbon (the “Executive”).

 

WHEREAS,
the Company desires to continue to employ the Executive and to enter into an
agreement embodying the terms of such employment; and

 

WHEREAS,
the Executive desires to accept such continuation of employment with the
Company, subject to the terms and conditions of this Agreement.

 

NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

 

1.                                      Employment
Period.  Subject to the provisions for
earlier termination hereinafter provided, the Executive’s employment hereunder
shall be for a term commencing on the Effective Date and ending on the fourth
(4th) anniversary
of the Effective Date (the “Employment Period”).  For purposes of this Agreement, “Effective
Date” shall mean the date of the closing of the Company’s initial public
offering of shares of its common stock. 
The Executive’s employment hereunder is terminable at will by the
Company or by the Executive at any time (for any reason or for no reason),
subject to the provisions of Section 4 hereof.  This Agreement shall become effective on the
Effective Date and, in the event the Effective Date does not occur on or prior
to March 31, 2011 (or such later date as the Company and Executive agree
in writing), then this Agreement shall terminate on such date and shall be of
no force or effect.

 

2.                                      Terms of
Employment.

 

(a)                                 Position and
Duties.

 

(i)                                     During the
Employment Period, the Executive shall serve as the Company’s Executive Vice
President, Media and Operations, reporting to the Chief Executive Officer or
his or her designee, and shall perform such duties as are usual and customary
for such position.  At the Company’s
request, the Executive shall serve the Company and/or its subsidiaries and
affiliates in other capacities in addition to the foregoing consistent with the
Executive’s role as Executive Vice President, Media and Operations of the
Company.  In the event that the
Executive, during the Employment Period, serves in any one or more of such
additional capacities, the Executive’s compensation shall not be increased
beyond that specified in Section 2(b) hereof.  In addition, in the event the Executive’s
service in one or more of such additional capacities is terminated, the
Executive’s compensation, as specified in Section 2(b) hereof, shall
not be diminished or reduced in any manner as a result of such termination
provided that the Executive otherwise remains employed under the terms of this
Agreement.  In the event the Company
requests that Executive serve the Company and/or its subsidiaries in a capacity
that involves substantial additional responsibilities to those associated with
Executive’s role as Executive Vice President, Media and Operations, then the
Company and Executive shall discuss in good faith whether any modifications
should be made to the terms of this Agreement consistent with Executive’s
assumption of such additional responsibilities; provided that the terms of this
Agreement shall continue to apply until 

 

 

such time (if any) as Executive and the Company
agree to any modification of or amendment to this Agreement pursuant to Section 10(i) below.

 

(ii)                                  During the
Employment Period, and excluding any periods of vacation and sick leave to
which the Executive may be entitled, the Executive agrees to devote the
Executive’s full business time and attention to the business and affairs of the
Company.  Notwithstanding the foregoing,
during the Employment Period, it shall not be a violation of this Agreement for
the Executive to engage in any of the following activities: (A) serve on
boards, committees or similar bodies of charitable or nonprofit organizations, (B) fulfill
limited teaching, speaking and writing engagements on a volunteer basis, and/or
(C) holding economic interests in companies in which the Executive does
not take an operating role (not to exceed a 5% interest in any company), in
each case, so long as such activities do not, individually or in the aggregate,
materially interfere or conflict with the performance of the Executive’s duties
and responsibilities under this Agreement.

 

(iii)                               During the
Employment Period, the Executive shall perform the services required by this
Agreement at the Company’s principal offices located in Santa Monica,
California (the “Principal Location”), except for travel to other
locations as may be necessary to fulfill the Executive’s duties and
responsibilities hereunder.

 

(b)                                 Compensation,
Benefits, Etc.

 

(i)                                     Base Salary.  During the Employment Period, the Executive
shall receive a base salary initially set at the rate in effect as of the
Effective Date, and increased on January 1, 2011 to a rate of $250,000 per
annum (the “Base Salary”).  The
Base Salary shall be reviewed annually by the Compensation Committee (the “Compensation
Committee”) of the Board (the “Board”) and may be increased from
time to time by the Compensation Committee in its sole discretion.  The Base Salary shall be paid in installments
in accordance with the Company’s applicable payroll practices, as in effect
from time to time, but no less often than monthly.

 

(ii)                                  Annual Bonus.  In addition to the Base Salary, the Executive
shall be eligible to earn, for each fiscal year of the Company ending during
the Employment Period, a discretionary cash performance bonus (an “Annual
Bonus”) under the Company’s bonus plan or program applicable to senior
executives.  The Executive’s target
Annual Bonus for 2010 shall be set at the level in effect as of the Effective
Date and shall, for fiscal years 2011 and later during the Employment Period,
be set at fifty percent (50%) of the Base Salary actually paid for such year,
but the actual amount of the Annual Bonus shall be determined on the basis of
the attainment of Company performance metrics and/or individual performance
objectives, in each case, as established and approved by the Board or the
Compensation Committee (or their designee) in its sole discretion. Payment of any
Annual Bonus(es), to the extent any Annual Bonus(es) become payable, will be
contingent upon the Executive’s continued employment through the applicable
payment date, which shall occur on the date on which annual bonuses are paid
generally to the Company’s similarly situated executives.

 

2

 

(iii)                               Stock Option
Award.  Subject to adoption by the
Board and approval by the Company’s stockholders of the 2010 Incentive Award Plan (the “Plan”),
the Company shall grant to the Executive, as soon as practicable after the
execution of this Agreement (which grant date, for the avoidance of doubt, may
precede the Effective Date) (the “Grant Date”), a nonqualified option to
purchase two hundred thousand (200,000) shares of the Company’s common stock
(the “Stock Option”) with
an exercise price equal $9.00 per share. 
Subject to Section 4(a) hereof, the Stock Option shall vest
and become exercisable in substantially equal installments (rounded up to the
nearest whole share) on each monthly anniversary of the Effective Date
occurring over the four (4)-year period immediately following the Effective
Date, subject to the Executive’s continued employment with the Company through
such date.  If the Effective Date does
not occur on or prior to March 31, 2011 for any reason, then,
notwithstanding anything to the contrary, the Stock Option shall terminate and
be forfeited, and the Company shall have no further obligations with respect
thereto.  The terms and conditions of the
Stock Option shall, in a manner consistent with this Section 2(b)(iii), be
set forth in a separate award agreement in a form prescribed by the Company
(the “Stock Option Agreement”), to be entered into by the Company and
the Executive, which shall evidence the grant of the Stock Option.  The Stock Option shall be governed in all
respects by the terms and conditions of the Plan.

 

(iv)                              Incentive,
Savings and Retirement Plans.  During the Employment Period, the Executive
shall be eligible to participate in all other incentive plans, practices,
policies and programs, and all savings and retirement plans, practices,
policies and programs, in each case that are available generally to similarly
situated executives of the Company.

 

(v)                                 Welfare Benefit
Plans.  During the Employment Period,
the Executive and the Executive’s dependents shall be eligible to participate
in the welfare benefit plans, practices, policies and programs (including, as
applicable, medical, dental, disability, employee life, group life and
accidental death insurance plans and programs) maintained by the Company for
its similarly situated executives.

 

(vi)                              Expenses.  During the Employment Period, the Executive
shall be entitled to receive prompt reimbursement for all reasonable business
expenses incurred by the Executive in accordance with the policies, practices
and procedures of the Company provided to similarly situated executives of the
Company.

 

(vii)                           Fringe Benefits.  During the Employment Period, the Executive
shall be entitled to such fringe benefits and perquisites as are provided by
the Company to its similarly situated executives from time to time, in
accordance with the policies, practices and procedures of the Company, and
shall receive such additional fringe benefits and perquisites as the Company
may, in its discretion, from time-to-time provide.  Nothing contained in Sections 2(b)(iv)-(v) hereof
or this Section 2(b)(vii) shall, or shall be construed to, obligate
the Company to adopt or maintain any incentive, savings, retirement, welfare,
fringe benefit or other plan(s) or program(s) at any time.

 

(viii)                        Vacation.  During the Employment Period, the Executive
shall not be entitled to a fixed number of paid vacation, personal or sick days
per year.  As a 

 

3

 

salaried employee, the Company expects the Executive
to use the Executive’s judgment to take time off from work for vacation or
other personal time in a manner consistent with getting the Executive’s work
done in a timely fashion, providing excellent service to the Company’s
customers and partners and avoiding inconveniencing the Executive’s
co-workers.  To the extent the Executive
has an existing balance of accrued, unused vacation as of the Effective Date,
that time will be applied to the Executive’s absences until it is exhausted.

 

3.                                      Termination of
Employment.

 

(a)                                 Death or
Disability.  The
Executive’s employment shall terminate automatically upon the Executive’s death
during the Employment Period.  Either the
Company or the Executive may terminate the Executive’s employment in the event
of the Executive’s Disability during the Employment Period.  For purposes of this Agreement, “Disability”
shall mean a disability as determined under the Company’s applicable long-term
disability plan that prevents the Executive from performing the Executive’s
duties under this Agreement (even with a reasonable accommodation by the
Company) for a period of six (6) months or more or, if no such plan
applies, as determined in the reasonable discretion of the Company.

 

(b)                                 Cause.  The Company may terminate the Executive’s
employment during the Employment Period for Cause or without Cause.  For purposes of this Agreement, “Cause”
shall have the meaning set forth in the Plan.

 

(c)                                  Termination by
the Executive.  The
Executive’s employment may be terminated by the Executive for any reason,
including with Good Reason in connection with a Change in Control (as defined
in the Plan).  For purposes of this
Agreement, “Good Reason” shall mean the occurrence of any one or more of
the following events in connection with a Change in Control, in any case,
without the Executive’s prior written consent, unless the Company fully
corrects the circumstances constituting Good Reason (provided such
circumstances are capable of correction) as provided below:

 

(i)                                     a demotion or
material diminution of the Executive’s position, authority, duties or
responsibilities (other than any
insubstantial action not taken in bad faith and which is promptly remedied by
the Company upon notice by the Executive); provided that “Good Reason” does not
include a change in title, authority, duties and/or responsibilities following
a Change in Control if (A) the Executive’s new title is
that of a senior officer of the entity surviving such Change in Control (or, if
applicable, its parent company if such entity has a parent company) reporting
directly to an executive officer of the entity surviving such Change in Control
(or, if applicable, its parent company, if such entity has a parent company)
and the Executive’s authority,
duties and responsibilities are commensurate with such title or (B) (1) the
entity surviving such Change in Control (or, if applicable, its parent company
if such entity has a parent company) continues to operate the Company’s
principal businesses as a separate unit, division or subsidiary or combines the
Company’s principal businesses with one of its existing units, divisions
or subsidiaries and (2) the Executive’s new title is
that of a senior officer of such unit, division or subsidiary reporting
directly to an executive officer of such unit, division or subsidiary (or to an
executive officer of the entity surviving the Change in Control or parent
company thereof) and (in either case), the Executive’s authority, duties
and 

 

4

 

responsibilities are commensurate with such title
and similar in scope (with respect to such unit, division or subsidiary) to the
authority, duties and responsibilities of the Executive prior to the Change in
Control;

 

(ii)                                  a requirement
that the Executive report to work more than twenty (20) miles from the Company’s
Principal Location (not including normal business travel required of the
Executive’s position) or, to the extent such requirement would not constitute a
material change in the geographic location at which the Executive must perform
services under this Agreement within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), such higher
number of miles from the Company’s Principal Location as would constitute a
material change in the geographic location at which the Executive must perform
services under this Agreement within the meaning of Section 409A of the
Code;

 

(iii)                               a material
reduction in the Executive’s base salary; or

 

(iv)                              a material
breach by the Company of its obligations hereunder.

 

Notwithstanding
the foregoing, the Executive will not be deemed to have resigned for Good
Reason unless (1) the Executive provides the Company with written notice
setting forth in reasonable detail the facts and circumstances claimed by the
Executive to constitute Good Reason within sixty (60) days after the date of
the occurrence of any event that the Executive knows or should reasonably have
known to constitute Good Reason, (2) the Company fails to cure such acts
or omissions within thirty (30) days following its receipt of such notice, and (3) the
effective date of the Executive’s termination for Good Reason occurs no later
than sixty (60) days after the expiration of the Company’s cure period.

 

(d)                                 Notice of
Termination.  Any
termination by the Company for Cause, or by the Executive for Good Reason,
shall be communicated by a Notice of Termination to the other parties hereto
given in accordance with Section 10(b) hereof.  For purposes of this Agreement, a “Notice
of Termination” means a written notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) to the
extent applicable, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s employment under
the provision so indicated and (iii) if the Date of Termination (as
defined below) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than sixty (60) days after the
giving of such notice).  The failure by
the Executive or the Company to set forth in the Notice of Termination any fact
or circumstance which contributes to a showing of Good Reason or Cause shall
not waive any right of the Executive or the Company, respectively, hereunder or
preclude the Executive or the Company, respectively, from asserting such fact
or circumstance in enforcing the Executive’s or the Company’s rights hereunder.

 

(e)                                  Termination of
Offices and Directorships.  Upon
termination of the Executive’s employment for any reason, unless otherwise
specified in a written agreement between the Executive and the Company, the
Executive shall be deemed to have resigned from all offices, directorships, and
other employment positions if any, then held with the Company, and shall take
all actions reasonably requested by the Company to effectuate the foregoing.

 

5

 

4.                                      Obligations of
the Company upon Termination.

 

(a)                                 Without Cause,
For Good Reason, Death or Disability.  Subject to Section 4(d) hereof, if
the Executive incurs a “separation from service” from the Company (within the
meaning of Section 409A(a)(2)(A)(i) of the Code, and Treasury
Regulation Section 1.409A-1(h)) (a “Separation from Service”)
during the Employment Period (such date, the “Date of Termination”) by
reason of (1) a termination of the Executive’s employment by the Company
without Cause; (2) a termination of the Executive’s employment by the
Executive for Good Reason; or (3) a termination of the Executive’s
employment by reason of the Executive’s death or Disability (each of (1), (2) and
(3), a “Qualifying Termination”):

 

(i)                                     The Executive
(or the Executive’s estate or beneficiaries, if applicable) shall be paid, in a
single lump-sum payment on the date of the Executive’s termination of
employment, the aggregate amount of the Executive’s earned but unpaid Base
Salary and accrued but unpaid vacation pay (if any) through the date of such
termination (the “Accrued Obligations”), in each case, to the extent not
previously paid.

 

(ii)                                  In addition,
subject to Section 4(d) hereof and the Executive’s (or the Executive’s
estate’s or beneficiaries’, if applicable) timely execution and non-revocation
of a Release (as described below), the Executive (or the Executive’s estate or
beneficiaries, if applicable) shall be paid:

 

(A)                               an amount equal
to six (6) months’ of the Base Salary in effect on the Date of Termination
(the “Continuation Amount”), payable in substantially equal installments
(the “Installments”) in accordance with the Company’s normal payroll
procedures during the period commencing on the Date of Termination and ending
on the six (6)-month anniversary of the Date of Termination; provided, however,
that no payments under this Section 4(a)(ii)(A) shall be made prior
to the first payroll date occurring on or after the thirtieth (30th) day following the Date of
Termination (such payroll date, the “First Payroll Date”) (with amounts
otherwise payable prior to the First Payroll Date paid on the First Payroll
Date without interest thereon); provided, further, that in no
event shall any of the Installments be paid later than March 15th of the year following that in which the Date
of Termination occurs, and any of Installments that would otherwise be paid
after such March 15th shall instead be paid on such March 15th; and

 

(B)                               any unpaid
Annual Bonus to which the Executive would have become entitled for any fiscal
year of the Company that ends on or before the Date of Termination had the
Executive remained employed through the payment date, payable in a single
lump-sum payment on the date on which annual bonuses are paid to the Company’s
senior executives generally for such calendar year, but in no event later than March 15th of the calendar year immediately following the
calendar year in which the Date of Termination occurs, with the actual date
within such period determined by the Company in its sole discretion.

 

6

 

(iii)                               In addition,
subject to Section 4(d) hereof and conditioned upon the Executive’s
timely execution and non-revocation of a Release, during the period commencing
on the Date of Termination and ending on the six (6)-month anniversary of the
Date of Termination or, if earlier, the date on which the Executive becomes
eligible for coverage under the group health plan of a subsequent employer (of
which eligibility the Executive hereby agrees to give prompt notice to the
Company) (in any case, the “COBRA Period”), subject to the Executive’s
valid election to continue healthcare coverage under Section 4980B of the
Code and the regulations thereunder, the Company shall continue to provide the
Executive and the Executive’s eligible dependants with coverage under its group
health plans at the same levels and the same cost to the Executive as would
have applied if the Executive’s employment had not been terminated based on the
Executive’s elections in effect on the Date of Termination), provided,
however, that (1) if any plan pursuant to which such
benefits are provided is not, or ceases prior to the expiration of the period
of continuation coverage to be, exempt from the application of Section 409A
of the Code under Treasury Regulation Section 1.409A-1(a)(5), or (2) the
Company is otherwise unable to continue to cover the Executive under its group
health plans, then, in either case, an amount equal to each remaining Company
subsidy shall thereafter be paid to the Executive as currently taxable
compensation in substantially equal monthly installments over the continuation
coverage period (or the remaining portion thereof).

 

The
payments and benefits described in the preceding Sections 4(a)(ii) and (iii) are
referred to herein as the “Severance.” 
Notwithstanding the foregoing, it shall be a condition to the Executive’s
(or the Executive’s estate’s or beneficiaries’, if applicable) right to receive
the Severance that the Executive (or the Executive’s estate or beneficiaries,
if applicable) execute and deliver to the Company an effective release of
claims in substantially the form attached hereto as Exhibit A (the “Release”)
within twenty-one (21) days (or, to the extent required by law, forty-five (45)
days) following the Date of Termination and that the Executive (or the Executive’s
estate or beneficiaries, if applicable) not revoke such Release during any
applicable revocation period.

 

(b)                                 For Cause,
Without Good Reason or Other Terminations.  If the Company terminates the Executive’s
employment for Cause, the Executive terminates the Executive’s employment
without Good Reason, or the Executive’s employment terminates for any other
reason not enumerated in this Section 4, in any case, during the
Employment Period, the Company shall pay to the Executive the Accrued
Obligations in cash within thirty (30) days after the Date of Termination (or
by such earlier date as may be required by applicable law).

 

(c)                                  Equity Vesting
in Connection with a Change in Control.  In addition to any payments or benefits due
to the Executive under Section 4(a) above (if any), subject to and
conditioned upon the Executive’s timely execution and non-revocation of a
Release, if the Executive’s employment is terminated by reason of a Qualifying
Termination and a Change in Control (A) occurs on or within ninety (90)
days after the Date of Termination or (B) has occurred within one (1) year
before the Date of Termination, all outstanding compensatory equity awards that
have not yet vested shall conditionally vest and, as applicable, become
exercisable on the later of the Date of Termination and the date of such Change
in Control (and such vesting shall become unconditional upon such execution and
non-revocation of a Release); 

 

7

 

provided, however, that if the Executive fails to
timely execute or revokes the Release, all such conditionally vested awards
(and any shares received in respect of such awards) shall be forfeited upon
such failure or revocation (subject to repayment by the Company to the
Executive of any amounts (if any) paid by the Executive with respect to shares
underlying such conditionally vested awards. 
For the avoidance of doubt, if a Qualifying Termination occurs prior to
a Change in Control, all outstanding, unvested compensatory equity awards that
would otherwise terminate on the Date of Termination shall remain outstanding
and eligible to vest solely upon a Change in Control occurring within ninety
(90) days after the Date of Termination (but shall not otherwise vest following
the Date of Termination) and shall terminate on the ninetieth (90th) day following the Date of
Termination if a Change in Control has not occurred on or prior to such
ninetieth (90th) day (or such
earlier expiration date applicable to the award (other than due to a termination
of employment)).

 

(d)                                 Six-Month Delay.  Notwithstanding anything to the contrary in
this Agreement, no compensation or benefits, including without limitation any
severance payments or benefits payable under Section 4 hereof, shall be
paid to the Executive during the six (6)-month period following the Executive’s
“separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of
the Code) if the Company determines that paying such amounts at the time or
times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of
the Code.  If the payment of any such
amounts is delayed as a result of the previous sentence, then on the first
business day following the end of such six (6)-month period (or such earlier
date upon which such amount can be paid under Section 409A of the Code
without resulting in a prohibited distribution, including as a result of the
Executive’s death), the Company shall pay the Executive a lump-sum amount equal
to the cumulative amount that would have otherwise been payable to the
Executive during such period.

 

(e)                                  Exclusive
Benefits.  Except as
expressly provided in this Section 4 and subject to Section 5 hereof,
the Executive shall not be entitled to any additional payments or benefits upon
or in connection with the Executive’s termination of employment.

 

(f)                                   Equity Award
Agreements.  For the avoidance of doubt, nothing contained in this Agreement is
intended to result in any vesting terms that are less favorable to the
Executive than those contained in any applicable equity award agreement and, to
the extent that the vesting terms contained in any such award agreement are
more favorable to the Executive than those provided herein, including, without
limitation, this Section 4, the terms of such award agreement shall
control.

 

5.                                      Non-Exclusivity
of Rights.  Amounts
which are vested benefits or which the Executive is otherwise entitled to
receive under any plan, policy, practice or program of or any contract or
agreement with the Company at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract
or agreement except as explicitly modified by this Agreement.

 

6.                                      Excess
Parachute Payments, Limitations on Payments.

 

(a)                                 Best Pay Cap.
Notwithstanding any other provision of this Agreement, in the event that any
payment or benefit received or to be received by the Executive (including any
payment or benefit received in connection with a termination of the Executive’s
employment, 

 

8

 

whether
pursuant to the terms of this Agreement or any other plan, arrangement or
agreement) (all such payments and benefits, including the payments and benefits
under Section 4 hereof, being hereinafter referred to as the “Total
Payments”) would be subject (in whole or part), to excise tax imposed under
Section 4999 of the Code (the “Excise Tax”), then, after taking
into account any reduction in the Total Payments provided by reason of Section 280G
of the Code in such other plan, arrangement or agreement, the cash severance
payments under this Agreement shall first be reduced, and the noncash severance
payments hereunder shall thereafter be reduced, to the extent necessary so that
no portion of the Total Payments is subject to the Excise Tax but only if (A) the
net amount of such Total Payments, as so reduced (and after subtracting the net
amount of federal, state and local income taxes on such reduced Total Payments
and after taking into account the phase out of itemized deductions and personal
exemptions attributable to such reduced Total Payments) is greater than or
equal to (B) the net amount of such Total Payments without such reduction
(but after subtracting the net amount of federal, state and local income taxes
on such Total Payments and the amount of Excise Tax to which the Executive
would be subject in respect of such unreduced Total Payments and after taking
into account the phase out of itemized deductions and personal exemptions
attributable to such unreduced Total Payments). 
The Total Payments shall be reduced in the following order: (A) reduction
of any cash severance payments otherwise payable to the Executive that are
exempt from Section 409A of the Code; (B) reduction of any other cash
payments or benefits otherwise payable to the Executive that are exempt from Section 409A
of the Code, but excluding any payments attributable to any acceleration of
vesting or payments with respect to any equity award that are exempt from Section 409A
of the Code; (C) reduction of any other payments or benefits otherwise
payable to the Executive on a pro-rata basis or such other manner that complies
with Section 409A of the Code, but excluding any payments attributable to
any acceleration of vesting and payments with respect to any equity award that
are exempt from Section 409A of the Code; and (D) reduction of any
payments attributable to any acceleration of vesting or payments with respect
to any equity award that are exempt from Section 409A of the Code, in each
case beginning with payments that would otherwise be made last in time.

 

(b)                                 Certain
Exclusions. For purposes of determining whether and the extent
to which the Total Payments will be subject to the Excise Tax, (A) no
portion of the Total Payments the receipt or enjoyment of which the Executive
shall have waived at such time and in such manner as not to constitute a “payment”
within the meaning of Section 280G(b) of the Code shall be taken into
account; (B) no portion of the Total Payments shall be taken into account
which, in the written opinion of an independent, nationally recognized
accounting firm (the “Accounting Firm”), does not constitute a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code
(including by reason of Section 280G(b)(4)(A) of the Code) and, in
calculating the Excise Tax, no portion of such Total Payments shall be taken
into account which, in the opinion of the Accounting Firm, constitutes
reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of
the Code, in excess of the Base Amount (as defined in Section 280G(b)(3) of
the Code) allocable to such reasonable compensation; and (iii) the value
of any non cash benefit or any deferred payment or benefit included in the
Total Payments shall be determined by the Accounting Firm in accordance with
the principles of Sections 280G(d)(3) and (4) of the Code.

 

9

 

7.                                       Confidential
Information and Non-Solicitation.  The Executive hereby acknowledges that the
Executive has previously entered into an agreement with the Company containing
confidentiality and other protective covenants (the “Confidentiality
Agreement”) and that the Executive remains bound by the terms and
conditions of the Confidentiality Agreement.

 

8.                                       Representations.  The Executive hereby represents and warrants
to the Company that (a) the Executive is entering into this Agreement
voluntarily and that the performance of the Executive’s obligations hereunder
will not violate any agreement between the Executive and any other person,
firm, organization or other entity, and (b) the Executive is not bound by
the terms of any agreement with any previous employer or other party to refrain
from competing, directly or indirectly, with the business of such previous
employer or other party that would be violated by the Executive’s entering into
this Agreement and/or providing services to the Company pursuant to the terms
of this Agreement.

 

9.                                       Successors.

 

(a)                                  This Agreement is personal
to the Executive and, without the prior written consent of the Company, shall
not be assignable by the Executive otherwise than by will or the laws of
descent and distribution.  This Agreement
shall inure to the benefit of and be enforceable by the Executive’s legal
representatives.

 

(b)                                 This Agreement shall inure
to the benefit of and be binding upon the Company and its successors and
assigns.

 

(c)                                  The Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place.  As used in
this Agreement, “Company” shall mean the Company as hereinbefore defined and
any successor to its business and/or assets as aforesaid which assumes and
agrees to perform this Agreement by operation of law, or otherwise.

 

10.                                 Miscellaneous.

 

(a)                                  Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without
reference to principles of conflict of laws. 
The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect.

 

(b)                                 Notices.  All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

 

If to the Executive:  at the Executive’s most recent address on the
records of the Company.

 

If to the Company:

 

10

 

Demand
Media, Inc.

1333
Second Street, Ste. 100

Santa Monica, CA 90401

Attn:
General Counsel

 

with
a copy to:

 

Latham &
Watkins LLP

355 South Grand Ave. 

Los Angeles, CA 90071-1560

Attn: Alex Voxman

 

or
to such other address as either party shall have furnished to the other in
writing in accordance herewith.  Notice
and communications shall be effective when actually received by the addressee.

 

(c)                                  Sarbanes-Oxley Act of 2002.  Notwithstanding anything herein to the
contrary, if the Company determines, in its good faith judgment, that any
transfer or deemed transfer of funds hereunder is likely to be construed as a
personal loan prohibited by Section 13(k) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) and the rules and
regulations promulgated thereunder, then such transfer or deemed transfer shall
not be made to the extent necessary or appropriate so as not to violate the
Exchange Act and the rules and regulations promulgated thereunder.

 

(d)                                 Section 409A of the
Code.

 

(i)  To the extent applicable, this Agreement
shall be interpreted in accordance with Section 409A of the Code and
Department of Treasury regulations and other interpretive guidance issued
thereunder.  Notwithstanding any
provision of this Agreement to the contrary, if the Company determines that any
compensation or benefits payable under this Agreement may be subject to Section 409A
of the Code and related Department of Treasury guidance, the Company shall work
in good faith with the Executive to adopt such amendments to this Agreement or
adopt other policies and procedures (including amendments, policies and
procedures with retroactive effect), or take any other actions, that the
Company determines are necessary or appropriate to avoid the imposition of
taxes under Section 409A of the Code, including without limitation,
actions intended to (i) exempt the compensation and benefits payable under
this Agreement from Section 409A of the Code, and/or (ii) comply with
the requirements of Section 409A of the Code and related Department of
Treasury guidance; provided, however, that this Section 10(d) shall not create an
obligation on the part of the Company to adopt any such amendment, policy or
procedure or take any such other action, nor shall the Company have any
liability for failing to do so.

 

(ii)  Any right to a series of installment
payments pursuant to this Agreement is to be treated as a right to a series of
separate payments.  To the extent
permitted under Section 409A of the Code, any separate payment or benefit
under this Agreement or otherwise shall not be deemed “nonqualified deferred
compensation” subject to Section 409A of the Code and Section 4(d) hereof
to the extent provided in the exceptions in Treasury Regulation 

 

11

 

Section 1.409A-1(b)(4),
Section 1.409A-1(b)(9) or any other applicable exception or provision
of Section 409A of the Code.

 

(iii)  To the extent that any payments or
reimbursements provided to the Executive under this Agreement, including,
without limitation, pursuant to Section 2(b)(vii) hereof, are deemed
to constitute compensation to the Executive to which Treasury Regulation Section 1.409A-3(i)(1)(iv) would
apply, such amounts shall be paid or reimbursed reasonably promptly, but not
later than December 31 of the year following the year in which the expense
was incurred.  The amount of any such
payments eligible for reimbursement in one year shall not affect the payments
or expenses that are eligible for payment or reimbursement in any other taxable
year, and the Executive’s right to such payments or reimbursement of any such
expenses shall not be subject to liquidation or exchange for any other benefit.

 

(e)                                  Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.

 

(f)                                    Withholding.  The Company may withhold from any amounts
payable under this Agreement such Federal, state, local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.

 

(g)                                 No Waiver.  The Executive’s or the Company’s failure to
insist upon strict compliance with any provision of this Agreement or the
failure to assert any right the Executive or the Company may have hereunder,
including, without limitation, the right of the Executive to terminate
employment for Good Reason pursuant to Section 3(c) hereof, shall not
be deemed to be a waiver of such provision or right or any other provision or
right of this Agreement.

 

(h)                                 Entire Agreement.  As of the Effective Date, this Agreement,
together with the Confidentiality Agreement, any prior equity award agreements,
and the Stock Option Agreement, constitutes the final, complete and exclusive
agreement between the Executive and the Company with respect to the subject
matter hereof and replaces and supersedes any and all other agreements, offers
or promises, whether oral or written, by any member of the Company and its
subsidiaries and affiliates, or representative thereof.  The Executive agrees that the Employment
Agreement dated as of April 21, 2006 (the “Existing Agreement”) shall be
terminated and will be of no further force or effect from and after the
Effective Date.  In the event that the
Effective Date does not occur prior to March 31, 2011 (or such later date
as Executive and the Company agree in writing), this Agreement (including,
without limitation, the immediately preceding sentence) shall have no force or
effect (and, for the avoidance of doubt, the Existing Agreement shall continue
to apply thereafter).

 

(i)                                     Amendment.  No amendment or other modification of this
Agreement shall be effective unless made in writing and signed by the parties
hereto.

 

(j)                                     Counterparts.  This Agreement and any agreement referenced
herein may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original but which together shall constitute one and
the same instrument.

 

12

 

[SIGNATURE PAGE FOLLOWS]

 

13

 

 

IN WITNESS WHEREOF, the Executive has hereunto set
the Executive’s hand and, pursuant to the authorization from the Board, the
Company has caused these presents to be executed in its name on its behalf, all
as of the day and year first above written.

 

 

	
   

  	
  DEMAND MEDIA, INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard Rosenblatt

  
	
   

  

  	
   

  	
  Name:

  	
  Richard
  Rosenblatt

  
	
   

  	
  Title:

  	
  Chairman
  & CEO

  
	
   

  
	
   

  
	
  “EXECUTIVE”

  
	
   

  
	
   

  
	
  /s/ Larry Fitzgibbon

  
	
  Larry
  Fitzgibbon

  

 

14

 

EXHIBIT A

 

GENERAL RELEASE

 

For
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the undersigned does hereby release and forever discharge the “Releasees”
hereunder, consisting of Demand Media, Inc., a Delaware corporation (the “Company”)
and each of its partners, subsidiaries, associates, affiliates, successors,
heirs, assigns, agents, directors, officers, employees, representatives,
lawyers, insurers, and all persons acting by, through, under or in concert with
them, or any of them, of and from any and all manner of action or actions,
cause or causes of action, in law or in equity, suits, debts, liens, contracts,
agreements, promises, liability, claims, demands, damages, losses, costs,
attorneys’ fees or expenses, of any nature whatsoever, known or unknown, fixed
or contingent (hereinafter called “Claims”), which the undersigned now
has or may hereafter have against the Releasees, or any of them, by reason of
any matter, cause, or thing whatsoever from the beginning of time to the date
hereof.  The Claims released herein include, without limiting the
generality of the foregoing, any Claims in any way arising out of, based upon,
or related to the employment or termination of employment of the undersigned by
the Releasees, or any of them; any alleged breach of any express or implied
contract of employment; any alleged torts or other alleged legal restrictions
on Releasees’ right to terminate the employment of the undersigned; and any
alleged violation of any federal, state or local statute or ordinance
including, without limitation, Title VII of the Civil Rights Act of 1964, the
Age Discrimination In Employment Act, the Americans With Disabilities Act, and
the California Fair Employment and Housing Act. Notwithstanding the foregoing,
this general release (the “Release”) shall not operate to release any
rights or claims of the undersigned (i) to payments or benefits under Section 4(a) of
that certain Employment Agreement, dated as of
                  ,
2010, between Demand Media, Inc. and the undersigned (the “Employment
Agreement”), whichever is applicable to the payments and benefits provided
in exchange for this Release, (ii) to payments or benefits under any
equity award agreement between the undersigned and the Company, (iii) with
respect to Section 2(b)(vi) of the Employment Agreement, (iv) to
accrued or vested benefits the undersigned may have, if any, as of the date
hereof under any applicable plan, policy, practice, program, contract or
agreement with the Company, or (v) to any Claims, including claims for
indemnification and/or advancement of expenses, arising under any
indemnification agreement between the undersigned and the Company or under the
bylaws, certificate of incorporation of other similar governing document of the
Company.

 

THE
UNDERSIGNED ACKNOWLEDGES THAT THE EXECUTIVE HAS BEEN ADVISED BY LEGAL COUNSEL
AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542,
WHICH PROVIDES AS FOLLOWS:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.”

 

A-1

 

THE
UNDERSIGNED, BEING AWARE OF SAID CODE SECTION, HEREBY EXPRESSLY WAIVES ANY
RIGHTS THE EXECUTIVE MAY HAVE THEREUNDER, AS WELL AS UNDER ANY OTHER
STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.

 

IN
ACCORDANCE WITH THE OLDER WORKERS BENEFIT PROTECTION ACT OF 1990, THE
UNDERSIGNED IS HEREBY ADVISED AS FOLLOWS:

 

(A)                              THE EXECUTIVE
HAS THE RIGHT TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS RELEASE;

 

(B)                                THE EXECUTIVE
HAS TWENTY-ONE (21) DAYS TO CONSIDER THIS RELEASE BEFORE SIGNING IT; AND

 

(C)                                THE EXECUTIVE
HAS SEVEN (7) DAYS AFTER SIGNING THIS RELEASE TO REVOKE THIS RELEASE, AND
THIS RELEASE WILL BECOME EFFECTIVE UPON THE EXPIRATION OF THAT REVOCATION
PERIOD.

 

The
undersigned represents and warrants that there has been no assignment or other
transfer of any interest in any Claim which the Executive may have against
Releasees, or any of them, and the undersigned agrees to indemnify and hold
Releasees, and each of them, harmless from any liability, Claims, demands,
damages, costs, expenses and attorneys’ fees incurred by Releasees, or any of
them, as the result of any such assignment or transfer or any rights or Claims
under any such assignment or transfer.  It is the intention of the parties
that this indemnity does not require payment as a condition precedent to
recovery by the Releasees against the undersigned under this indemnity.

 

The undersigned agrees that if the Executive hereafter commences any
suit arising out of, based upon, or relating to any of the Claims released hereunder
or in any manner asserts against Releasees, or any of them, any of the Claims
released hereunder, then the undersigned agrees to pay to Releasees, and each
of them, in addition to any other damages caused to Releasees thereby, all
attorneys’ fees incurred by Releasees in defending or otherwise responding to
said suit or Claim.

 

The
undersigned further understands and agrees that neither the payment of any sum
of money nor the execution of this Release shall constitute or be construed as
an admission of any liability whatsoever by the Releasees, or any of them, who
have consistently taken the position that they have no liability whatsoever to
the undersigned.

 

IN
WITNESS WHEREOF, the undersigned has executed this Release this 2 day of October,
2010.

 

	
  /s/
  [ILLEGIBLE]

  	
   

  

 

A-2

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