Document:

Exhibit 10.7

 

FORM OF COMMERCEHUB, INC.

LEGACY STOCK APPRECIATION RIGHTS
 PLAN

STOCK OPTION AGREEMENT

 

This Stock Option Agreement (the “Option Agreement”), dated as of the        day of           2016 (the “Conversion Date”), is between CommerceHub, Inc., a Delaware corporation (the “Company”), and                   (the “Awardee”).

 

WHEREAS, the Awardee was a holder of outstanding stock appreciation rights (the “Original SAR”) granted on                     (the “Original Grant Date”) under the Commerce Technologies, Inc. 2010 Stock Appreciation Rights Plan (as amended effective as of January 13, 2011, the “Prior Plan”) administered by Commerce Technologies, Inc. (“CTI”).

 

WHEREAS, in connection with the reorganization of CTI, the merger of CTI with and into a subsidiary of the Company and the anticipated spin-off of the Company from Liberty Interactive Corporation, a Delaware corporation, the Prior Plan was amended and restated into the form of the CommerceHub Inc. Legacy Stock Appreciation Rights Plan (the “Plan”) and, as of the Conversion Date, the outstanding stock appreciation rights under the Prior Plan were converted into options to purchase Common Shares pursuant to the Plan.

 

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other good and valuable consideration, the parties hereto, intending to be legally bound hereby, agree as follows:

 

1.     Grant of Option. Pursuant to the terms of the Plan, the Committee hereby grants to Awardee, an Option, subject to the terms, definitions and provisions of the Plan adopted by the Company, which is incorporated herein by reference, and pursuant to this Option Agreement. Unless otherwise defined herein, capitalized terms used in this Option Agreement shall have the meaning ascribed to such terms in the Plan. In the event of a conflict between the terms of the Plan and this Option Agreement, the Plan shall prevail.

 

2.     Value of the Option. The Option shall entitle the Awardee, after the Option has vested, to purchase Common Shares at the exercise price set forth on the attached Notice of Grant (the “Exercise Price”) upon exercise of the Option pursuant to Section 5. No dividend equivalents are paid with respect to any Option.

 

3.     Nonassignability of Option. The Option is not assignable or transferable by the Awardee except by will or by the laws of descent and distribution. During the lifetime of the Awardee, only the Awardee or Awardee’s guardian or legal representative shall be entitled to exercise the Option.

 

4.     Exercise Period. The Option or any portion thereof may be exercised only after the Option or any portion thereof has vested and only within the term set forth in the Notice of Grant contained herein and may be exercised during such term only in accordance with the terms of the Plan and this Option Agreement. No Options shall be exercisable after the tenth anniversary of the Original Grant Date.

 

5.     Method of Exercise. Options will be considered exercised (as to the number of Options specified in the notice referred to in clause (i) below) on the latest of (a) the date of exercise designated in the written notice referred to in clause (i) below, (b) if the date so designated is not

 

 

a Business Day (as defined below), the first Business Day following such date or (c) the earliest Business Day by which the Company has received all of the following:

 

(i)            Written notice, in such form as the Committee may require, containing such representations and warranties as the Committee may require and designating, among other things, the date of exercise and the number and of Common Shares to be purchased by exercise of Options (each, an “Option Share”);

 

(ii)           Payment of the applicable Exercise Price for each Option Share in any (or a combination) of the following forms: (A) cash, (B) check, (C) the delivery, together with a properly executed exercise notice, of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds required to pay such Exercise Price (and, if applicable, the Required Withholding Amount as described in Section 6) or (D) the delivery of irrevocable instructions (provided such method of exercise is then-permitted by the Company) via the Company’s online grant and administration program for the Company to withhold the number of Common Shares (valued at the Fair Market Value of such Common Share on the date of exercise) required to pay such Exercise Price (and, if applicable, the Required Withholding Amount as described in Section 6) that would otherwise be delivered by the Company to the Awardee upon exercise of the Options; and

 

(iii)                               Any other documentation that the Committee may reasonably require.

 

As used in this Section 5, “Business Day” means any day other than Saturday, Sunday or a day on which banking institutions in Albany, New York, are required or authorized to be closed.

 

6.     Mandatory Withholding for Taxes. The Awardee acknowledges and agrees that the Company will deduct from the Common Shares otherwise payable or deliverable upon exercise of any Options that number of Common Shares (valued at the Fair Market Value of such Common Shares on the date of exercise) that is equal to the amount of all federal, state and other governmental taxes required to be withheld by the Company or any subsidiary of the Company upon such exercise, as determined by the Company (the “Required Withholding Amount”), unless provisions to pay such Required Withholding Amount have been made to the satisfaction of the Company. If the Awardee elects to make payment of the applicable Exercise Price by delivery of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds required to pay such Exercise Price, such instructions may also include instructions to deliver the Required Withholding Amount to the Company. In such case, the Company will notify the broker promptly of its determination of the Required Withholding Amount.

 

7.     Forfeiture. If the Awardee has a Separation from Service with the Company for any reason, any portion of this Option that is issued and outstanding but unvested as of the date of such termination of employment[, after giving effect to any acceleration of vesting provided for in the Notice of Grant herein,] will be cancelled and terminate as of the date of termination. If the Awardee has a Separation from Service for Cause [(as such term is defined in the Offer Letter between Awardee and CTI dated as of [·], as amended as of [·])] or, in the event that the Committee determines, in its sole discretion, that any conduct of the Awardee constitutes Grounds for Forfeiture of the Option, all rights of the Awardee under this Option Agreement and the Plan (including rights with respect to outstanding vested or unvested Options) will terminate as of the date of termination.

 

 

8.     Separation from Service. In case of the Awardee’s Separation from Service for any reason other than for Cause, the Awardee may exercise this Option during the Termination Period set out in the Notice of Grant herein, but only to the extent it was exercisable at the date of such termination [after giving effect to any acceleration of vesting provided for in the Notice of Grant herein] (but in no event later than the “Term/Expiration Date” of this Option as set forth in the Notice of Grant herein). To the extent that Awardee was not entitled to exercise this Option at the date of such termination, and to the extent that Awardee does not exercise this Option (to the extent otherwise so entitled) within the Termination Period specified in the Notice of Grant, this Option shall terminate.

 

9.     [Clawback Policy. Notwithstanding any other provisions in this Option Agreement or the Plan, the Option shall be subject to recovery or clawback by the Company under any clawback policy adopted by the Company in accordance with Securities and Exchange Commission regulations or other applicable law, as amended or superseded from time to time.]

 

10.  Tax Consequences.

 

a.              Awardee understands that upon either the grant or the exercise of this Option, the Awardee may recognize adverse tax consequences.

 

b.              Awardee understands that the Company will be required to withhold any tax or social insurance required from any governmental authority. Awardee is encouraged to consult with a tax advisor concerning the tax consequences of exercising this Option.

 

11.  Entire Agreement. The Plan and this Option Agreement (including the Notice of Option Grant contained herein), constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of CTI and the Company and Awardee with respect to the subject matter hereof, and the Original SAR is hereby replaced in its entirety and is null and void and of no further effect.

 

AWARDEE ACKNOWLEDGES THAT NEITHER THE PLAN NOR THIS OPTION AGREEMENT CONFERS ANY RIGHT WITH RESPECT TO CONTINUANCE OF EMPLOYMENT WITH OR SERVICE TO THE COMPANY NOR INTERFERES IN ANY WAY WITH ANY RIGHT THE COMPANY WOULD OTHERWISE HAVE TO TERMINATE THE AWARDEE’S SERVICE AT ANY TIME, WITH OR WITHOUT CAUSE. NO PERSON SHALL, BY REASON OF PARTICIPATION IN THE PLAN, ACQUIRE ANY RIGHT OR TITLE TO ANY ASSETS, FUNDS OR PROPERTY OF THE COMPANY, INCLUDING WITHOUT LIMITATION, ANY SPECIFIC FUNDS, ASSETS OR OTHER PROPERTY WHICH THE COMPANY MAY SET ASIDE IN ANTICIPATION OF ANY LIABILITY UNDER THE PLAN. A PARTICIPANT SHALL HAVE ONLY A CONTRACTUAL RIGHT TO AN OPTION, IF ANY, PAYABLE UNDER THE PLAN, UNSECURED BY ANY ASSETS OF THE COMPANY, AND NOTHING CONTAINED IN THE PLAN SHALL CONSTITUTE A GUARANTEE THAT THE ASSETS OF THE COMPANY SHALL BE SUFFICIENT TO PAY ANY BENEFITS TO ANY PERSON.

 

Awardee acknowledges receipt of a copy of the Plan and certain information related thereto and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Option Agreement subject to all of the terms and provisions of the Plan. Awardee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of independent counsel prior to executing this Option Agreement and fully understands all provisions relating to this Option Agreement. Awardee hereby agrees to accept as binding, conclusive and final

 

 

all decisions or interpretations of the Committee upon any questions arising under the Plan or this Option Agreement.

 

If by [·], the Awardee does not reject the Options granted pursuant to this Option Agreement by written notice received by the Company’s Human Resources Department, the Options will be deemed to be accepted on the Conversion Date.

 

[Remainder of Page Intentionally Left Blank]

 

 

COMMERCEHUB, INC.
 NOTICE OF OPTION
 GRANT

 

[Awardee’s Name and Address]

 

CommerceHub, Inc. (the “Company”) has granted                     (“Awardee”) an Option covering Common Shares of the Company as follows:

 

	
Original Grant Date:
    	
 
    	
 
    	
 
    
	
Conversion Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Number of Common Shares Covered by this Option:
    	
 
    	
 
    	
 
    
	
Exercise Price:
    	
 
    	
$
    	
 
    	
 
    
	
Term/Expiration Date:
    	
 
    	
 
    	
 
    
					

 

Vesting: The Option shall be vested and exercisable in accordance with the vesting schedule described below, subject to the Awardee continuing as an employee, consultant and/or director of the Company or an Affiliate or subsidiary of the Company on such dates. For further clarification, the Option shall be exercisable in accordance with the following schedule:

 

[INSERT VESTING SCHEDULE]

 

[Accelerated Vesting:

 

A.            Double Trigger Change of Control Accelerated Vesting. In the event the Company terminates the Awardee’s employment other than for Cause during the six (6)-month period following the closing date of a Change of Control (as such term is defined below) resulting from a sale of all or substantially all of the Company’s business (by stock sale, asset sale or merger) to a third party acquirer, other than an Exempt Holder (as such term is defined below), any Options that are issued and outstanding, but unvested, as of the date of such termination of employment will vest effective as of the date of such termination of employment, subject to the release requirement described below.

 

Any acceleration of vesting of unvested Options described in this paragraph A is subject to the condition subsequent that the Awardee delivers a general release of claims in form and substance satisfactory to the Company, [which release shall be provided by the Company to the Awardee within three (3) business days of the date of such termination of employment,] and that any applicable revocation period applicable to such release expires, both within [60][55] days following the date of such Separation from Service (the “Vesting Condition”). The Awardee acknowledges that while the Option or a portion thereof may retroactively vest effective as of the date of the Awardee’s Separation from Service as set forth in this Notice of Option Grant, the Awardee will nonetheless not be able to exercise any accelerated portion of the Option unless and until the Vesting Condition is timely met.

 

“Change of Control” means any transaction in which the Company’s Board (or, if approval of the Board is not required as a matter of law, the stockholders of the Company) shall approve (i) any merger, consolidation or binding share exchange to which the Company is a party as a result of which the holders of the Company’s Common Shares immediately prior thereto have less than a majority of the combined voting power of the outstanding capital stock of the Company ordinarily (and apart from the rights accruing under special circumstances) having the right to vote in the election of

 

 

directors immediately following such merger, consolidation or binding share exchange, or (ii) any sale, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company other than to an Affiliate of the Company. For the avoidance of doubt, a public offering of the Company’s (or any of its Affiliate’s) securities (including any spin-off or similar transaction and/or any other distribution of securities to the shareholders of the Company) and any corporate restructuring activities undertaken in connection with any such public offering, spin-off or distribution of securities shall not constitute a Change of Control resulting from a sale of the Company’s business for purposes of this provision. “Exempt Holder” means any direct or indirect beneficial equity holder (or family members of beneficial holders that are individuals) of the Company or any of its direct or indirect parent entities which holder is also a director or officer of the Company or any of its direct or indirect parent entities.]

 

[Termination Period: Any portion of the Option that, as of the date of the Awardee’s Separation from Service for any reason other than for Cause, is unexpired, vested and non-forfeitable may be exercised until the “Close of Business” on the [three][six] month anniversary of the date of such Separation from Service with the Company (but in no event later than the Term/Expiration Date). “Close of Business” means, on any day, 5:00 p.m., Albany, New York time on such day.]

 

By your signature and the signature of the Company’s representative below, you and the Company agree that this Option is granted under and governed by the terms and conditions of the Legacy Stock Appreciation Rights Plan which is incorporated herein by reference and the Option Agreement herein.

 

	
AWARDEE
    	
 
    	
COMMERCEHUB, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
(Print Name):
    	
 
    	
 
    	
(Print Name):
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Date:Exhibit 10.21

 

CommerceHub

 

June 17, 2013

 

Dear John:

 

It is with great pleasure that I invite you to join Commerce Technologies, Inc (“CommerceHub”).

 

Start Date:

7/29/2013

 

Title:

EVP, Production Systems

 

Reporting to:

You will report directly to Richard Jones, CTO & EVP, Operations.

 

Office Location:

Upon your start date, you will be required to work at our Albany, NY facility.

 

Compensation

The key elements of your compensation package include the following:

 

Base Salary

Your annual base salary will be $200.000 The company pay cycle is twice monthly; therefore you will be paid $8,333 33 semi-monthly

 

Bonus

You will be eligible for an annual bonus of up to 25% of your salary (or as otherwise set forth by the Board of Directors) and to be paid based on achieving objectives

 

Stock Appreciation Rights

You have been selected to participate in Commerce Technologies, Inc Stock Appreciation Rights Plan (the “Plan”) Pursuant to the Plan, you will be granted the right to receive the ‘spread” between the fair market value of shares of Commerce Technologies, Inc common stock on the date you are awarded stock appreciation rights and the fair market value of that stock on the date of exercise, each as determined by the committee, with respect to 25,000 shares of common stock

 

Please be advised that any grant of stock appreciation rights to you is subject to ratification by the Board of Directors and is subject to the express provisions, including, but not limited to, the vesting schedule and employment termination provisions of the Plan. Following ratification by the Board of Directors, you will be given a Stock Appreciation Rights Award agreement, together with a Summary of the provisions of the Plan.

 

Vacation

You will be provided 15 days of vacation, which accrue semi-monthly at 5.00 hours per pay period.

 

CommerceHub 255 Fuller Road · Suite 327 · Albany, NY 12203-3640

tel. 518.810 0700 · fax 518810 0701 · www.commercehub corn

 

 

Holidays

Commerce Technologies, Inc. has eight company paid holidays.

 

Health Benefits

CTI offers flexible health benefits through Empire Prism EPO. This plan offers comprehensive coverage, preventative care, vision and a prescription drug plan. The Company contributes 79% of the single health insurance premium.

 

Dental Benefits

CTI offers a voluntary comprehensive dental program through Guardian Life Insurance after 90 days of full time employment.

 

Life Insurance

CTI offers Life insurance through Guardian Life Insurance. The Life Insurance coverage is paid for by CTI equivalent to 100% of your salary to a maximum of $50,000 after 90 days of full time employment. We also offer voluntary life insurance for employees to purchase.

 

Short Term Disability

CTI offers short term disability through Mutual of Omaha. The short term disability is paid for by CTI after 90 days of full time employment.

 

Long Term Disability

CTI offers a voluntary long term disability through Mutual of Omaha. You are eligible to participate after 90 days of  full time employment

 

Flexible Spending

CTI offers FlexPlan A Tax-Saving Flexible Benefits Program to put aside pre-tax dollars — an amount you determine to be taken out of your employee pay to reimburse yourself for qualified health related expenses that are not covered or only partially covered under your insurance plans

 

401K Plan

CTI has established a 401 K plan enabling you to shelter a portion of your income from federal and state income taxes CTI will make matching contributions equal to $1 00 for each $1 00 you contribute to the Plan each payroll period for the first 6% of your eligible compensation

 

Direct Deposit

CTI employs direct deposit for all payroll purposes

 

Conditions of Employment

This offer of employment is contingent upon a satisfactory background investigation. There are several other essential terms and conditions of your employment with Commerce Technologies, Inc. These include, but are not limited to, the following

 

First, Commerce Technologies, Inc ‘s offer of employment is for an employment-at-will position. Your employment is not for a definite or guaranteed period of time and you may be discharged, or you may resign, at any time, for any reason or no reason with or without cause and with or without prior notice.

 

CommerceHub 255 Fuller Road · Suite 327 · Albany, NY 12203-3640

tel. 518.810 0700 · fax 518810 0701 · www.commercehub corn

 

 

Second, you must read and sign Commerce Technologies. Inc.’s Confidential Information and Non-Compete Agreement (“Agreement’) prior to reporting to work. You must fully comply with this Agreement.

 

Third, it is essential that you identify immediately in writing any circumstances or agreements with prior employers — including, but not limited to, non-compete agreements which might interfere or limit your ability to work at Commerce Technologies, Inc. and to perform fully your duties and responsibilities.

 

Fourth. your employment is contingent upon your compliance with the US immigration law. The law requires you to complete the US Government Employment Eligibility Verification Form (1.9), and to provide on your first day of employment documents that verify your identity and employment eligibility.

 

I believe this position is tailored for your skill set Should you have any questions, please do not hesitate to contact me directly.

 

 

Sincerely.

 

	
/s/ Richard Jones
    	
 
    	
/s/ Bob Marro
    
	
Richard Jones, CTO & EVP, Operations
    	
 
    	
Bob Marro, Chief Financial Officer
    
	
Commerce Technologies, Inc.
    	
 
    	
Commerce Technologies, Inc.
    
	
“CommerceHub”
    	
 
    	
“CommerceHub”
    

 

I acknowledge and accept this offer of employment with Commerce Technologies, Inc.

 

	
/s/ John Hinkle
    	
 
    	
6/17/2013
    
	
John Hinkle
    	
 
    	
Date
    

 

CommerceHub 255 Fuller Road · Suite 327 · Albany, NY 12203-3640

tel. 518.810 0700 · fax 518810 0701 · www.commercehub corn

 

 

NON-COMPETITION, NON-DISCLOSURE 
 AND NON-SOLICITATION AGREEMENT

 

Non-Competition, Non-Disclosure and Non-Solicitation Agreement, dated as of this

14 July 2013 (the “Agreement”), between Commerce Technologies, Inc., a New

York corporation with its principal place of business at 255 Fuller Road, Albany, NY

12203 (the “Company”) and,  JOHN HINKLE, an individual residing at

19 WINDSOR DR, ALBANY, NY 12205 (“Employee”).

 

RECITALS:

 

WHEREAS, Employee will be an employee of, or an advisor or consultant to, the Company or will be serving the Company in a similar capacity; and

 

WHEREAS, Employee acknowledges that he may have access to certain confidential information of the Company in the course of his employment; and

 

WHEREAS, Employee understands that the improper and unauthorized disclosure of such confidential information will cause damage to the Company; and

 

WHEREAS, Employee acknowledges that his employment by a competitor of the Company, the inducing of any of the Company’s employees to leave the Company, the soliciting of the Company’s customers on behalf of or for the benefit of any person or entity other than the Company or any similar actions will cause damage to the Company; and

 

WHEREAS, the Company desires that Employee and Employee recognizes the requirement to execute this Agreement as a material inducement for it to initiate Employee’s employment (or such other arrangement) with the Company.

 

NOW, THEREFORE, on the basis of the foregoing premises and in consideration of the mutual covenants and agreements set forth herein, the parties hereto agree as follows:

 

Section 1.                                           Secrecy and Non-Competition.

 

(a)                                 No Competing Employment. Employee hereby warrants and agrees that he will not, during the term of his employment by the Company (or other arrangement) and for a period of twelve (12) months from the date of the termination of such employment (or other arrangement) (the “Restricted Period”), directly or indirectly, own (other than as a less than 5% shareholder of a publicly traded company), manage, operate or control, or participate in the ownership, management, operation or control of, or be connected with or have any interest in, as a stockholder, director, officer, employee, agent, consultant, partner or otherwise, in any business of the same nature as, or in competition with, the business in which the Company is now engaged.

 

(b)                                 Non-Disclosure of Confidential Information. Employee shall not disclose to any person or entity, or use for commercial purposes or allow third parties to use for commercial purposes, at any time after the date hereof, any information not in the public

 

 

domain or generally known in the industry, in any form, acquired by him while employed by the Company, relating to the Company, including but not limited to information regarding customers, vendors, suppliers, trade secrets, training programs, manuals or materials, technical information, contracts, systems, procedures, mailing lists, know-how, trade names, price lists, financial or other data, business plans, code books, invoices and other financial statements, computer programs, software systems, databases, discs, printouts, plans (business, technical or otherwise), customer and industry lists, internal reports, personnel files, sales and advertising material, telephone numbers, names and addresses, or any other compilation of information (whether written or unwritten) which is or was used in the business of the Company.

 

(c)                                  No Interference. During the Restricted Period, Employee shall not, whether for his own account or for the account of any other individual, partnership, firm, corporation or other business organization, directly or indirectly solicit, endeavor to entice away from the Company, or otherwise interfere with the relationship of the Company with any person who, to the knowledge of Employee, is employed by the Company or who is, or was within the prior twelve months, a customer or a client of the Company. This provision shall not prohibit Employee from contacting past employees of the Company.

 

(d)                                 Inventions, etc. The Employee hereby sells, transfers and assigns to the Company or to any person or entity designated by the Company all of the entire right, title and interest of the Employee in and to all inventions, ideas, disclosures and improvements, whether patented or unpatented, and copyrightable material, made or conceived by the Employee, solely or jointly, during his employment by the Company which relate to methods, apparatus, designs, products, processes or devices, sold, leased, used or under consideration or development by the Company, or which otherwise relate to or pertain to the business, functions or operations of the Company or which arise from the efforts of the Employee during the course of his employment for the Company. The Employee shall communicate promptly and disclose to the Company, in such form as the Company requests, all information, details and data pertaining to the aforementioned inventions, ideas, disclosures and improvements; and the Employee shall execute and deliver to the Company such formal transfers and assignments and such other papers and documents as may be necessary or required of the Employee to permit the Company or any person or entity designated by the Company to file and prosecute the patent applications and, as to copyrightable material, to obtain copyright thereof. Any invention relating to the business of the Company and disclosed by the Employee within one year following the termination of his employment with the Company shall be deemed to fall within the provisions of this paragraph unless proved to have been first conceived and made following such termination.

 

(e)                                  Injunctive Relief. Employee acknowledges that the restrictions in Sections 1(a)-(c) hereof are fair and reasonable given the nature of the Company’s business and agrees that a violation of any of the respective covenants herein will cause irreparable injury to the Company not adequately compensable by money damages, and the Company shall be entitled, in addition to any other rights and remedies it may have hereunder, to enforce such restrictions by temporary or permanent injunctive or mandatory relief obtained in a court of competent jurisdiction without the necessity of proving damages and without prejudice to any other remedies it may have at law.

 

 

(f)                                   Extension of Restricted Period. In addition to the remedies the Company may seek and obtain pursuant to Section 1(e) above, the Restricted Period shall be extended by any and all periods during which Employee shall be found by a court to have been in violation of the restrictions contained in Sections 1(a)-(c).

 

Section 2.                                           Waiver and Amendments. Any waiver, alteration, amendment or modification of any of the terms of this Agreement shall be valid only if made in writing and signed by the Company and Employee.

 

Section 3.                                           Severability If any covenant or provision of this Agreement is found to be invalid or unenforceable by a court of competent jurisdiction or any mediator (i) the remaining terms and provisions hereof shall remain valid, and (ii) the invalid or unenforceable provision shall be deemed replaced by a term or provision that is valid and enforceable and comes closest to expressing the intention of the invalid term or provision.

 

Section 4. 1.1 Governing Law, Consent to Jurisdiction, etc.

 

(a)                            THIS AGREEMENT SHALL BE CONSTRUED, PERFORMED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ITS PRINCIPLES OR RULES OF CONFLICT OF LAWS TO THE EXTENT SUCH PRINCIPLES OR RULES WOULD REQUIRE OR PERMIT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

 

(b)                            Each of the Parties hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any court of the State of New York sitting in Albany, New York, or any Federal court of the United States of America sitting in the Northern District of New York and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the Transaction or for recognition or enforcement of any judgment relating to such transactions, and each of the Parties hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding shall be heard and determined in such court of the State of New York or, to the extent permitted by law, in such Federal court. Each of the Parties agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

 

( )                                Each of the Parties hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or related to this Agreement in any New York state or Federal court. Each of the Parties hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

Section 5.                                           Notices.

 

(a)                                 All communications under this Agreement shall be in writing and shall be delivered by hand or mailed by overnight courier or by registered or certified mail:

 

 

(i)                                     If to Employee                                                          or such other address as Employee may have furnished to the Company in writing,

 

(ii)                                  If to the Company at 255 Fuller Road, Albany, NY 12203, or such other address as the Company may have furnished to Employee in writing.

 

(iii)                               Any notice so addressed shall be deemed to be given: if delivered by hand, on the date of delivery; if delivered by overnight courier, on the first business day following the date of mailing; and if by mail, on the third business day after mailing.

 

Section 6.                                      Mediation. In the event of any disagreement relating to the terms or provisions of this Agreement, the Company and Employee agree to promptly submit the dispute to mediation with a mediator satisfactory to both the Company and Employee.

 

Section 7.                                      Section Headings. The headings of the Sections and Subsections of this Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Agreement, affect the meaning or interpretation of this Agreement, or any term or provision hereof.

 

Section 8.                                      Entire Agreement. This Agreement constitutes the entire understanding and agreement of the parties regarding the subject matter addressed herein. This Agreement supersedes all prior negotiations, discussions, correspondence, communications, understandings and agreements between the Company and Employee regarding the subject matter of this Agreement.

 

Section 9.                                      Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement.

 

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

 

 

	
 
    	
 
    	
COMMERCE   TECHNOLOGIES, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Hinkle
    
	
 
    	
 
    	
John Hinkle
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
/s/ Janet Cody
    
	
 
    	
 
    	
Witness
    

 

 

COMMERCE TECHNOLOGIES, INC.

2010 STOCK APPRECIATION RIGHTS PLAN

EVIDENCE OF STOCK APPRECIATION RIGHT

 

1.              Grant of SAR. Pursuant to the terms of the Commerce Technologies, Inc. 2010 Stock Appreciation Rights Plan (“Plan”), the Committee hereby grants to John Hinkle (“Awardee”), a Stock Appreciation Right (“SAR”), subject to the terms, definitions and provisions of the Plan adopted by the Corporation, which is incorporated herein by reference, and pursuant to this Evidence of Stock Appreciation Right (the “Agreement”). Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Agreement. In the event of a conflict between the terms of the Plan and this Agreement, the Plan shall prevail.

 

2.              Value of the SAR. The SAR shall entitle the Awardee, after the SAR has vested and upon exercise of the SAR, to receive from the Corporation the Spread on the number of shares of the Corporation’s common stock, par value $.001 per share, with respect to which the SAR is granted. The “Spread” is the excess of the Fair Market Value per Common Share at the date the SAR is exercised over the Fair Market Value per Common Share on the date of the grant (“Base Price”). No dividend equivalents are paid with respect to any SAR.

 

3.              Nonassignability of SAR. The SAR is not assignable or transferable by the Awardee except by will or by the laws of descent and distribution. During the lifetime of the Awardee, only the Awardee or Awardee’s guardian or legal representative shall be entitled to exercise the SAR.

 

4.              Exercise Period. The SAR may be exercised only after the SAR has vested and only within the term set forth in the Notice of Grant contained herein and may be exercised during such term only in accordance with the terms of the Plan and this Agreement. No SARs shall be exercisable after the tenth anniversary of the date of grant. In addition, the SAR may not be exercised during any “quiet period” or other period of exercise restriction as set forth in the “Policy Regarding SAR Exercise Restrictions” as adopted or as may be adopted or modified in the future by the Corporation.

 

5.              Method of Exercise. This SAR shall be exercisable by written notice (in the form attached as Exhibit A). Such written notice shall be signed by the Awardee and delivered in person or by certified mail to the Corporation. Subject to Section 4 of this Agreement, this SAR shall be deemed to be exercised upon receipt by the Corporation of such written notice.

 

6.              Form of Payment. The Corporation shall satisfy its obligation upon exercise of this SAR in cash.

 

7.              Forfeiture. If the Awardee has a Separation from Service with the Corporation for any reason other than an involuntary Separation from Service without Cause, and other than by reason of Death, Disability, or Retirement; or, in the event that the Committee determines, in its sole discretion, that any conduct of the Awardee constitutes grounds for forfeiture of the SAR, all rights of the Awardee under this Agreement and the Plan (including rights with respect to outstanding SARs) will terminate.

 

 

8.              Separation from Service. In case of the involuntary Separation from Service without Cause, or by reason of Death, Disability, or Retirement, the Awardee may exercise this SAR during the Termination Period set out in the Notice of Grant herein, but only to the extent it was exercisable at the date of such termination (but in no event later than the “Term/Expiration Date” of this SAR as set forth in the Notice of Grant herein). To the extent that Awardee was not entitled to exercise this SAR at the date of such termination, and to the extent that Awardee does not exercise this SAR (to the extent otherwise so entitled) within the time specified herein, this SAR shall terminate.

 

9.              Tax Consequences.

 

a.              Awardee understands that upon either the grant or the exercise of this SAR, the Awardee may recognize adverse tax consequences.

 

b.              Awardee understands that the Corporation will be required to withhold any tax or social insurance required from any governmental authority. Awardee is encouraged to consult with a tax advisor concerning the tax consequences of exercising this SAR.

 

AWARDEE ACKNOWLEDGES THAT NEITHER THE PLAN NOR THIS AGREEMENT CONFERS ANY RIGHT WITH RESPECT TO CONTINUANCE OF EMPLOYMENT WITH OR SERVICE TO THE CORPORATION NOR INTERFERES IN ANY WAY WITH ANY RIGHT THE CORPORATION WOULD OTHERWISE HAVE TO TERMINATE THE AWARDEE’S SERVICE AT ANY TIME, WITH OR WITHOUT CAUSE. NO PERSON SHALL, BY REASON OF PARTICIPATION IN THE PLAN, ACQUIRE ANY RIGHT OR TITLE TO ANY ASSETS, FUNDS OR PROPERTY OF THE CORPORATION, INCLUDING WITHOUT LIMITATION, ANY SPECIFIC FUNDS, ASSETS OR OTHER PROPERTY WHICH THE CORPORATION MAY SET ASIDE IN ANTICIPATION OF ANY LIABILITY UNDER THE PLAN. A PARTICIPANT SHALL HAVE ONLY A CONTRACTUAL RIGHT TO A STOCK APPRECIATION RIGHT OR THE AMOUNTS, IF ANY, PAYABLE UNDER THE PLAN, UNSECURED BY ANY ASSETS OF THE CORPORATION, AND NOTHING CONTAINED IN THE PLAN SHALL CONSTITUTE A GUARANTEE THAT THE ASSETS OF THE CORPORATION SHALL BE SUFFICIENT TO PAY ANY BENEFITS TO ANY PERSON.

 

Awardee acknowledges receipt of a copy of the Plan and certain information related thereto and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Agreement subject to all of the terms and provisions of the Plan. Awardee has reviewed the Plan and this SAR Agreement in their entirety, has had an opportunity to obtain the advice of independent counsel prior to executing this Agreement and fully understands all provisions relating to this Agreement. Awardee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Agreement.

 

[Remainder of Page Intentionally Left Blank]

 

 

COMMERCE TECHNOLOGIES, INC. 
 NOTICE OF STOCK APPRECIATION RIGHT GRANT

 

John Hinkle

19 Windsor Drive

Albany, NY 12205

 

Commerce Technologies, Inc. (the “Corporation”) has granted John Hinkle (“Awardee”) a Stock Appreciation Right (“SAR”) covering Common Shares of the Corporation as follows:

 

	
Date of Grant:
    	
 
    	
October 7, 2013
    
	
Total Number of Common Shares Covered by this SAR:
    	
 
    	
25,000
    
	
Exercise Base Price:
    	
 
    	
$13.62
    
	
Term/Expiration Date:
    	
 
    	
October 7, 2023
    

 

Vesting: The SAR shall be vested and exercisable as to 25% of the SARs on each of the first four (4) anniversaries of the date of grant, subject to the Awardee continuing as an Employee of the Corporation or an affiliate or subsidiary of the Corporation on such dates. For further clarification, as stated in the 2010 Stock Appreciation Rights Plan, the SAR shall be exercisable in accordance with the following schedule:

 

	
First anniversary of the Date of Grant
    	
 
    	
25%
    
	
Second anniversary of the Date of Grant
    	
 
    	
50%
    
	
Third anniversary of the Date of Grant
    	
 
    	
75%
    
	
Fourth anniversary of the Date of Grant
    	
 
    	
100%
    

 

Termination Period: Any unexpired, vested and non-forfeitable SAR may be exercised for [three (3) months] after Awardee’s Separation from Service with the Corporation (but in no event later than the Term/Expiration Date).

 

By your signature and the signature of the Corporation’s representative below, you and the Corporation agree that this SAR is granted under and governed by the terms and conditions of the 2010 Stock Appreciation Rights Plan which is incorporated herein by reference and the Evidence of Stock Appreciation Right herein.

 

 

	
AWARDEE
    	
 
    	
COMMERCE TECHNOLOGIES, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
/s/ John Hinkle
    	
 
    	
By:
    	
/s/ Frank Poore
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
(Print Name):
    	
JOHN HINKLE
    	
 
    	
(Print Name):
    	
Frank Poore
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    	
CEO
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
10/7/2013
    	
 
    	
Date:
    	
10/7/2013
    
							

 

 

Exhibit A

Form of Exercise Notice

 

COMMERCE TECHNOLOGIES, INC.

STOCK APPRECIATION RIGHT (“SAR”) EXERCISE NOTICE

 

Commerce Technologies, Inc.

Attention: Corporate Secretary

255 Fuller Road

Suite 327

Albany NY 12203

 

1.              Exercise of SAR. Effective as of today,                                         , 20   , the undersigned (“Awardee”) hereby elects to exercise a stock appreciation right with respect to                             Common Shares (the “Shares”) of Commerce Technologies, Inc. pursuant to the Evidence of Stock Appreciation Rights by and between Awardee and Commerce Technologies, Inc, (“Corporation”), dated                                   (“SAR Agreement”) and pursuant to the Corporation’s 2010 Stock Appreciation Rights Plan (the “Plan”).

 

2.              Representations of Awardee. Awardee acknowledges that Awardee has received, read and understood the Plan, the SAR Agreement, and the Notice of Stock Appreciation Right Grant therein (“Notice of Grant”) and agrees to abide by and be bound by their terms and conditions.

 

3.              Tax Consultation. Awardee understands that Awardee may suffer adverse tax consequences as a result of Awardee’s exercise of rights under the SAR Agreement and this Notice. Awardee represents that Awardee has had the opportunity to consult with his or her own independent tax advisor in connection with exercising rights under this SAR Agreement and that Awardee is not relying on the Corporation for any tax advice.

 

4.              Entire Agreement. The Plan, the “Policy Regarding SAR Exercise Restrictions” as adopted or as may be adopted or modified in the future by the Corporation, and the SAR Agreement and the Notice of Grant contained therein, are incorporated herein by reference and constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Corporation and Awardee with respect to the subject matter hereof, and are governed by New York law except for that body of law pertaining to conflict of laws.

 

 

	
Submitted by:
    	
 
    	
Accepted by:
    
	
AWARDEE
    	
 
    	
COMMERCE TECHNOLOGIES, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
(Print Name):
    	
 
    	
 
    	
(Print Name):
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    	
Date:

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