Document:

ex10_02

March 5, 2012

John Boris
[Address redacted]

This letter supersedes the letter dated March 2, 2012.

Dear John:

We are excited at the prospect of adding you to the Shutterfly family, and look forward to welcoming you into our growing organization.  Accordingly, I am pleased to offer you a regular full-time position with Shutterfly as Senior Vice President, Chief Marketing Officer, commencing on a mutually agreed-upon date, reporting to Jeffrey Housenbold. This job is located in Redwood City, CA.  

For your information, I have enclosed several documents that will provide an introduction to life at Shutterfly.  Other Shutterfly policies and procedures are on Shutterfly's intranet and will be reviewed with you at orientation.  

Compensation
Your base salary will be $275,000 annually, minus applicable deductions and prorated for any partial periods of employment.  You will be paid semi-monthly in accordance with the company's normal payroll procedure.  

Hire on Bonus
You will receive a hire on bonus of $45,000 minus applicable deductions, which will be paid after ninety days from your start date.  If your employment is terminated prior to completion of your first year of employment, you will be responsible for reimbursing the Company a prorated portion of the bonus.

2012 Bonus
You will also be eligible to participate in our corporate bonus program. Your annual discretionary bonus target will be 30% of your annual salary, paid on a quarterly basis, if earned. Your eligibility for this discretionary bonus is determined at the end of each fiscal quarter and is based on various factors including company performance and your achievement of individual objectives. Bonuses are not earned until paid. To be eligible to receive a payment, you must be employed by Shutterfly on the first day of the quarter and at the time any bonuses are paid. Whether a bonus will be awarded in a particular bonus period, and in what amount, is within the sole discretion of Shutterfly. Both your base salary and the components of your bonus are subject to periodic review. Your bonus participation will be subject to all the terms, conditions and restrictions of the applicable Shutterfly Quarterly Bonus Plan, as amended from time to time. A copy of the current Quarterly Bonus Plan is enclosed with this letter. 
 
Equity
Subject to the approval of Shutterfly's Board of Directors in accordance with the Company's equity grant procedures, you will be granted a one-time award in the form of 114,000 Restricted Stock Units (RSUs) in accordance with Shutterfly's 2006 Equity Incentive Plan.  The RSUs will vest in 25% increments annually on each of the first, second, third and fourth anniversaries of the original grant date. Your RSUs will be subject to all the terms, conditions and restrictions of Shutterfly's 2006 Equity Incentive Plan (enclosed with this letter) and the execution of a restricted stock unit agreement pursuant to the 2006 Equity Incentive Plan.

You will receive more details regarding your equity award(s) from E*TRADE FINANCIAL, the equity administrator for Shutterfly.

John Boris
March 5, 2012
Page 2 of 3

Benefits
As an employee of Shutterfly, you will also be eligible to receive certain employee benefits, including medical, dental and vision coverage.  The medical, dental and vision coverage will begin on your date of hire as an employee.  Additionally, you will be eligible to participate in the Fidelity 401k plan.  Shutterfly reserves the right to revise or discontinue any or all of its benefit plans, at any time, in Shutterfly's sole discretion.  Enclosed is some information on Shutterfly's benefit plans.  Further information about these benefits can be obtained from the Shutterfly Benefits Department. 

Holidays
In 2012, Shutterfly will observe twelve paid holidays.  The holiday schedule may change at management's discretion.

Paid Time Off
In order to allow you the greatest possible flexibility with your time, you will accrue fifteen (15) days of paid time off per year for your first three (3) years of employment, subject to Shutterfly's paid time off policy.  After three (3) years of employment, you will begin to accrue twenty (20) days of paid time off per year.  You will begin to accrue paid time off on your start date.

Severance Benefits
Consistent with all members of the Shutterfly executive staff you are eligible to receive 6 months lump sum salary, 6 months company paid COBRA benefits, and a 12 months extended stock option exercise period in the event of your “Not For Cause” termination. Please see Attachment A, which is incorporated herein by reference, for the complete terms and conditions of your Severance Benefits.

Change of Control Benefits 
In the event of your Termination (as defined in Attachment B), within twelve (12) months following a Corporate Transaction (as defined in Shutterfly's 2006 Equity Incentive Plan), you will receive (A) items (1) and (2) of the Severance (on the terms and conditions provided in Attachment A) and (B) if the Company's equity awards are assumed in the Corporate Transaction, accelerated vesting of the number of your then-unvested Company stock option shares and restricted stock units, including earned and unearned unvested performance-based restricted stock units that would have vested during the twelve (12) months following the date of such termination (collectively, the “Change in Control Benefits”). These benefits are consistent with those of all Shutterfly executive staff members. Please see Attachment B, which is incorporated herein by reference, for the complete terms and conditions of your Change of Control Benefits.

Introductory Period
Your first ninety (90) days of work is known as an “Introductory Period”. This “getting acquainted” period gives the Company the opportunity to determine your ability to perform your job. It also provides you with the opportunity to determine if you are satisfied with the job and the Company.  Either you or the Company can terminate the employment relationship at any time during or after the Introductory Period, with or without Cause or advance notice. 

Employment Eligibility Verification
For purposes of federal immigration law, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States.  Such documentation must be provided to us within three (3) business days of your date of hire with the Company, or our employment relationship with you may be terminated. 

John Boris
March 5, 2012
Page 3 of 3

Employment at Will
If you choose to accept this offer, your employment with the Company will be voluntarily entered into and will be for no specified period. As a result, you will be free to resign at any time, for any reason, as you deem appropriate. The Company will have a similar right and may terminate its employment relationship with you at any time, with or without Cause or advance notice. 

Acceptance of Offer
To indicate your acceptance of the terms of this offer, please sign and date in the space provided below and return an executed copy to: Shutterfly, Inc.  2800 Bridge Parkway, Redwood City, CA 94065, Attention: Human Resources no later than March 6, 2012 after which this offer will expire.  A duplicate original is enclosed for your records. In addition to this letter, your offer of employment is conditioned upon: (1) completion and signing of the Shutterfly employment application; (2) successful completion of a background and reference check and (3) your signing of the Shutterfly Employee Invention Assignment and Confidentiality Agreement (and any other similar agreements relating to proprietary rights between you and the Company).

This letter agreement, the Shutterfly Employee Invention Assignment and Confidentiality Agreement, the 2006 Equity Plan, and your RSU Award Agreement constitute the entire agreement between you and the Company regarding the terms and conditions of your employment with the Company and together supersede any prior representations or agreements, whether written or oral. This letter, along with any agreements herein, may not be modified or amended except by a written agreement signed by the Chief Executive Officer of the Company.  If by March 6, 2012 we have not received a copy of this letter executed by you, then we will assume you have decided not to join the Company. 

We're sure you will find our corporate culture, including an environment that rewards talent, results and teamwork a gratifying place to work.  We look forward to your positive response and sharing our future success with you as part of the Shutterfly team. 

If you have any questions regarding this offer, please feel free to contact me.

Sincerely,

/s/ Jeffrey Housenbold

Jeffrey Housenbold
President and Chief Executive Officer
Shutterfly, Inc.

Enclosures:
Attachment A - Severance Benefits
Attachment B - Change in Control Benefits
Employee Invention Assignment and Confidentiality Agreement
Benefits Overview
Arbitration Agreement

Accepted by candidate:                    Date:

/s/ John Boris                        3/6/12    

Anticipated Start Date:   April 23, 2012        
cc:  HR Manager, for distribution to Personnel File

Attachment A

Severance Benefits
If your employment is terminated by the Company without Cause (as defined below), other than within twelve (12) months following a Corporate Transaction (as defined in the 2006 Equity Incentive Plan):

		
	1)
	a severance payment in the amount equal to six (6) months of your final base pay rate and, less applicable withholding taxes and regular deductions, payable in a lump sum (“Severance”);

		
	2)
	the post-termination exercise period for your Company stock options will be twelve (12) months following your termination date; and  

		
	3)
	if you are covered under the Company's group health plan as of the termination date and timely elect to continue your group coverage under COBRA, the Company will reimburse you upon submission of written proof of premium payment for up to six (6) months of the applicable COBRA premiums as COBRA is provided in accordance with the terms of the applicable plans and the law, beginning on the first of the month following the Company's receipt of your COBRA election notice and ending on the earlier of (i) the date you become covered under another group or individual health plan, or (ii) the last day of the six-month period described above.  You will be solely responsible for making your premium payments pursuant to COBRA in order to maintain such coverage, and the Company shall not be responsible for making any direct payments to any health care or insurance provider on your behalf

Your receipt of the foregoing severance benefits is conditioned on you having first executed, and not revoked, a general release of claims in favor of the Company (in a form prescribed by the Company) and the return of all Company property.  The Severance will be paid in the form of a lump sum, in accordance with the Company's standard payroll procedures, commencing within sixty (60) days following your “separation from service,” as defined under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) (subject to a six-month delay if you are a “specified employee” as defined under the Treasury Regulations under Section 409A of the Code and such delay is required to avoid the penalty taxes that otherwise may be imposed by Section 409A of the Code).  The parties intend that the foregoing Severance be provided in a manner consistent with Section 1.409A-1(b)(9) of the Treasury regulations such that the Severance will be exempt from Code Section 409A, and the Offer Letter (as amended) and shall be administered and operated in conformity with this intention.

“Cause” means your (i) gross negligence or willful misconduct in the performance of your duties after a notice is delivered to you that specifically identifies the manner in which the Company believes you have engaged in gross negligence or willful misconduct and you have been provided with thirty (30) days to cure any alleged gross negligence or willful misconduct in the performance of your duties; (ii) commission of any act of fraud or material dishonesty with respect to the Company; (iii) conviction of, or plea of guilty or “no contest” to, a felony or a crime of moral turpitude or dishonesty; (iv) material breach of any proprietary information and inventions agreement with the Company, including the Employee Invention Assignment and Confidentiality Agreement, or any other unauthorized use or disclosure of the Company's confidential information or trade secrets; or (v) repeated failure to perform the duties reasonably assigned to you after your receipt of written notification of such failure and a reasonable opportunity to cure such failure, which shall not be less than thirty (30) days following such notice.

Change in Control Benefits 
In the event of your Termination (as defined below), within twelve (12) months following a Corporate Transaction (as defined in Shutterfly's 2006 Equity Incentive Plan), you will receive (A) items (1) and (2) of the Severance (on the terms and conditions provided above) and (B) if the Company's equity awards are assumed in the Corporate Transaction, accelerated vesting of the number of your then-unvested Company stock option shares and restricted stock units, including earned and unearned unvested performance-based 
restricted stock units that would have vested during the twelve (12) months following the date of such termination (collectively, the “Change in Control Benefits”).  The Change in Control Benefits would be provided in lieu of any other severance-related benefits for which you may be eligible.  Your receipt of the Change in Control Benefits is conditioned on you having first executed, and not revoked, a general release of claims in favor of the Company (in a form prescribed by the Company) and the return of all Company property.

“Termination” means (a) a termination of your employment by the Company or its successor without Cause or (b) your resignation within three (3) months following an event constituting Good Reason, provided that you have given written 

notice to the Company of such event within forty-five (45) days of its occurrence and the Company has failed to cure such event within thirty (30) days following receipt of such notice.  For purposes of this paragraph, “Good Reason” means (i) a material reduction or change in your duties and responsibilities as in effect immediately prior to the Corporate Transaction; (ii) the relocation of the Company's corporate office at which you work by more than thirty-five (35) miles from its location immediately prior to such Corporate Transaction, which materially increases your commuting distance or (iii) a material reduction in your annual compensation, including base salary and bonus.ex10_37-2.htm

Exhibit 10.37(2)

 

AMENDMENT NO. 2 TO

INVESTMENT AGREEMENT

 

This Amendment No. 2 (this “Amendment”) to the Investment Agreement dated as of November 7, 2012 (the “Investment Agreement”) is made as of the 15th day of April, 2013, and, solely with respect to Section 2, to be effective as of the Effective Time (as defined below) by and among Pulse Electronics Corporation, Pulse Electronics (Singapore) Pte. Ltd. and OCM PE Holdings, L.P.

RECITALS:

The parties entered into the Investment Agreement as of November 7, 2012, as amended by that certain Amendment No. 1 to the Investment Agreement dated as of March 11, 2013.

 

The parties now wish to amend the Investment Agreement in the manner set forth in this Amendment.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

SECTION 1.  Capitalized Terms.  Capitalized terms used herein and not defined shall have the meanings ascribed to such terms in the Investment Agreement.

 

SECTION 2.  References to 64.3795%.  All references to the number “64.3795%” in the Investment Agreement are hereby changed to “67.9”%.

 

SECTION 3.  Illustrative Examples.

 

(a) The number 107,542,754 in the third recital of the Investment Agreement is hereby replaced with the number “132,120,020”.

 

(b) The final sentence of Section 1.01 of the Investment Agreement is hereby amended and restated in its entirety to read as follows:

 

For illustrative purposes only, assuming 100% participation by the Other Noteholders in the Exchange Offer, the Parent Preferred Stock issued to the Investors shall be convertible into shares of Common Stock at a ratio which results in the issuance of a number of shares of Common Stock equal to 125,420,502 and that, when added to the shares of Common Stock actually issued at the Closing to the Investors pursuant to Section 1.02, would result in the issuance of 168,849,202 shares of Common Stock to the Investors, as may be adjusted from time to time as a result of one or more stock splits.

 

(c) The number 6,669,517 in Section 1.01 of the Investment Agreement is hereby replaced with the number “6,699,518”.

 

  

2

  

 

SECTION 4.  Proxy Statement; Effective Time.  The Company shall include in its proxy statement and related materials (the “Proxy Statement”) in respect of its annual general meeting of shareholders in 2013 (the “2013 Meeting”) a proposal requesting that the Company’s shareholders approve Section 2 of this Amendment.   The Company shall provide the Investors with a reasonable opportunity to review and comment on such Proxy Statement, and such Proxy Statement shall be in a form reasonably acceptable to the Investors prior to its filing with the SEC.  Subject to the terms of that certain Forbearance and Commitment Letter among OCM PE Holdings, L.P., the Company and Pulse Electronics (Singapore) Pte. Ltd., dated March 11, 2013, the Company shall hold the 2013 Meeting no later than June 30, 2013.  Assuming the approval by the Company’s shareholders at the 2013 Meeting of Section 2 of this Amendment, Section 2 of this Amendment shall be effective as of the time immediately following such approval (the “Effective Time”).

 

SECTION 5.  Termination.  The termination of this Amendment shall require the mutual written consent of the Company and the Investors.

 

SECTION 6.  Voting Agreement.  The Company will enforce the terms of that certain Voting and Support Agreement, dated March 11, 2013, in the form attached hereto as Exhibit A.

 

SECTION 7.  Stockholder Vote.  The Company represents and warrants to the Investors that the affirmative vote of at least a majority of the votes cast by the holders of outstanding Common Stock entitled to vote thereon and outstanding Parent Preferred Stock, voting as separate classes, are the only votes of holders of securities of the Company that are necessary to approve and adopt Section 2 of this Amendment, and the Investors shall have the right to vote all of the shares of Common Stock and Parent Preferred Stock held by the Investors to approve and adopt Section 2 of the Amendment at the 2013 Meeting (or in connection with any written consent with respect to the approval and adoption of Section 2 of this Amendment by shareholders of the Company in lieu of a vote thereon).

 

SECTION 8.  Investor Vote.  The Investors agree that they shall vote all of the shares of Common Stock and Parent Preferred Stock held by them in favor of adoption of Section 2 of this  Amendment at the 2013 Meeting (or in connection with any written consent taken prior to the 2013 Meeting with respect to the approval and adoption of Section 2 of this Amendment by shareholders of the Company in lieu of a vote thereon).

 

SECTION 9.  Limited Amendment.  As of the date hereof and upon the Effective Time, except as specifically amended or supplemented hereby, the Investment Agreement shall continue in full force and effect in accordance with the provisions thereof as in existence on the date hereof.  From and after the date hereof, any reference to the Investment Agreement shall mean the Investment Agreement as amended hereby.

 

[Signature pages follow]

 

  

  

  

 

IN WITNESS WHEREOF, the parties have duly executed this Amendment as of the day and year first above written.

 

	  	
PULSE ELECTRONICS CORPORATION

	  	 
	  	By: 	/s/ Drew A. Moyer
	  	  	
Name:  Drew A. Moyer

	  	  	
Title:    Chief Financial Officer

 

	  	
PULSE ELECTRONICS (SINGAPORE) PTE. LTD.

	  	  
	  	By: 	/s/ Drew A. Moyer
	  	  	
Name:  Drew A. Moyer

	  	  	
Title:    Director

	  	
OCM PE HOLDINGS, L.P.

	  	  
	  	
By: Oaktree Fund GP, LLC

	  	
Its: General Partner

	  	  
	  	
By: Oaktree Fund GP I, L.P.

	  	
Its: Managing Member

	  	  
	  	By: 	/s/ Ken Liang
	  	  	
Name:  Ken Liang

	  	  	
Title:    Managing Director

	  	By:	/s/ Jay Ghiya
	  	  	
Name:  Jay Ghiya

	  	  	
Title:    Senior Vice President

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