[E-LOAN LETTERHEAD]
March 26, 1999
THIS VERSION SUPERSEDES ALL PRIOR ITERATIONS
Joe Kennedy
2865 Shadywood
Troy, MI 48098
Dear Joe,
We are very excited about your joining E-LOAN and helping us to build the
leading brand in the online mortgage space. We have all the ingredients in place
to make the best attempt ever in developing the first nationally branded
multi-lender. We've set the pace for product presentation and price leadership;
we own the best name for brand recognition and we have not only the experience,
but the vision to stay ahead of the competition and fundamentally change the way
people finance their homes.
However, to win the game we need more than just a great product and a great
name. We need a world class person that can translate E-LOAN into a promise that
customers believe in and aspire to. We believe that you are the person who can
help us to accomplish this, as a key team member.
The following is contingent upon a reference check.
POSITION: Senior Vice President of Marketing and Business
Development
START DATE: February 22, 1999
STOCK OPTIONS:249,173 in options shares of E-LOAN common
stock. This represents 2% of the current, fully diluted
stock (including all outstanding warrants and options,
vested and unvested). The stock options shall vest
monthly and become exercisable in full on the date four
(4) years after your hire date. 25% of the options will
become vested as of the 1st anniversary of employment.
The balance of the options will vest on a monthly basis.
Such options shall be subject to the terms and
conditions of the Company's Stock Option Plan and Stock
Option Agreement, including vesting requirements. Option
price to be set at $6.00. All options will be fully
adjusted for events such as splits. E-LOAN agrees to
provide a process for cashless exercise in the event
that the stock becomes publicly traded. In the event of
a change in control, E-LOAN agrees to vest the unvested
portion of your options at the rate of 50% so they may
be exercised in conjunction with the change of control
under terms as favorable as those offered to any
shareholder. In the event of a change in control, you
will have the option of leaving your options unvested
and fairly adjusted or converted in accordance with the
acquiring company's requirements.
SALARY: $200,000 annually to be paid bi-weekly in accordance
with E-LOAN, Inc. payroll practices and policy. Eligible
for senior management bonus, if one is established.
BENEFITS:
Health benefits will be offered to all employees. E-LOAN
contributes 70% of the actual monthly premium and the
employee contributes 30%. You will be eligible for all
management benefits programs. Upon the adoption of a
company plan, additional benefits will be offered.
E-LOAN does agree to reimburse you, with tax gross-up,
for the cost of your purchase of a $2 million Life
Insurance policy to benefit your family in the event of
your death, and for the cost of a Long-Term Disability
plan to provide you with $120,000 per year.
401K: You will be eligible upon adoption of the E-LOAN plan.
VACATION: You are eligible for 4 weeks vacation each year of
employment.
RELOCATION: E-LOAN will reimburse you for expense incurred in the
relocation of your and your family. Specifically, E-LOAN
will cover full reimbursement and tax gross-up as
necessary for: the physical move of your household goods
and automobiles; two house-hunting trips for you and
your family; house hunting services from a local
relocation vendor; temporary living expense and storage
of all household goods for up to 60 days; selling
commissions and fees to sell your current home; all
points, fees and closing costs on your purchase of a
home in the Bay Area; a bridge loan and long-term loan
assistance associated with the purchase of your new
home.
RESPONSIBILITIES: Including but not limited to: creating and further
developing E-LOAN's overall brand and marketing plan
along with all associated projects and activities,
provide leadership in development of the strategy and
tactics for new customers. Execution of the marketing
plan. Creation of marketing campaigns to generate new
customers using both traditional print and broadcast
advertising. Responsible for all business development
opportunities.
SEVERANCE: If your employment with E-LOAN is terminated by E-LOAN
other than for "Cause" (as defined below), then E-LOAN
will provide you with (i) a three month notice period,
(ii) twelve months salary and (iii) option vesting equal
to that which would have been achieved 12 months from
the actual severance date. Notwithstanding the
preceeding sentence, if your employment with E-LOAN is
terminated as a result of an "Involuntary Termination"
(as defined below) at any time within six (6) months
before or twelve (12) months after a "Change of Control"
(as defined below), then E-LOAN will provide you with 3
years of salary and full option vesting, including
gross-up for any taxation above standard individual tax
rates for ordinary income. If your employment with
E-LOAN terminates (i) voluntarily by you or (ii) for
Cause by E-LOAN,
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then you shall only be eligible for severance benefits
in accordance with the E-LOAN's established policies as
then in effect.
For this purpose, "Cause" is defined as: (i) an act of
dishonesty made by you in connection with your
responsibilities as an employee, (ii) your conviction
of, or plea of nolo contendere to, a felony, (iii) your
gross misconduct, or (iv) your failure to perform your
employment duties. For this purpose, "Change of Control"
of the Company is defined as: (i) any "person" (as such
term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) is or
becomes the "beneficial owner" (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities
of the Company representing 50% or more of the total
voting power represented by the Company's then
outstanding voting securities; or (ii) a change in the
composition of the Board of Directors of the Company
occurring within a two-year period, as a result of which
fewer than a majority of the directors are Incumbent
Directors. "Incumbent Directors" shall mean directors
who either (A) are directors of the Company as of the
date hereof, or (B) are elected, or nominated for
election, to the Board of Directors of the Company with
the affirmative votes of at least a majority of the
Incumbent Directors at the time of such election or
nomination (but shall not include an individual whose
election or nomination is in connection with an actual
or threatened proxy contest relating to the election of
directors to the Company); or (iii) the date of the
consummation of a merger or consolidation of the Company
with any other corporation that has been approved by the
stockholders of the Company, other than a merger or
consolidation which would result in the voting
securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities
of the surviving entity) more than fifty percent (50%)
of the total voting power represented by the voting
securities of the Company or such surviving entity
outstanding immediately after such merger or
consolidation, or the stockholders of the Company
approve a plan of complete liquidation of the Company;
or (iv) the date of the consummation of the sale or
disposition by the Company of all or substantially all
the Company's assets. For this purpose, "Involuntary
Termination" shall mean (i) without your consent, the
significant reduction of your duties or responsibilities
relative to your duties or responsibilities in effect
immediately prior to such reduction; (ii) without your
consent, a significant reduction by the Company in your
Base Salary as in effect immediately prior to such
reduction; (iii) a significant reduction by the Company
in the kind or level of employee benefits to which you
are entitled immediately prior to such reduction with
the result that your overall benefits package is
significantly reduced; or (iv) any purported termination
of you by the Company which is not effected by virtue of
your death, permanent and total disability, or for
Cause.
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Joe, we look forward to your working with the E-LOAN team. Please feel free to
call us if you have any questions, concerns or comments.
Sincerely,
/s/ CHRIS LARSEN /s/ JANINA PAWLOWSKI
Chris Larsen Janina Pawlowski
CEO President
To indicate your acceptance of E-LOAN's offer, please sign and date this letter
in the space provided below and return it to me. A duplicate original is
enclosed for your records. This letter, along with any agreement relating to
proprietary rights between you and E-LOAN, set forth the terms of your
employment with E-LOAN and supersedes any prior representation or agreements,
whether written or oral. This letter may not be modified or amended except by a
written agreement, signed by the CEO of E-LOAN and you. Please review the
attached Addendum that explains our Conflict of Interest policy.
/s/ JOE KENNEDY 3/30/99
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Joe Kennedy Date
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Addendum:
CONFLICT OF INTEREST: You agree that, during the term of your employment with
E-LOAN, you will not engage in any other business, occupation, consulting or
other business activity directly related to the business in which E-LOAN is now
involved or becomes involved during the term of your employment, nor will you
engage in any other activities that conflict with your obligations to E-LOAN.
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Employment Agreement - E-Loan Inc. and Joe Kennedy
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