HOMESTORE.COM, INC.
EMPLOYMENT AGREEMENT
This Agreement (the 'Agreement') is made as of June 7, 1999 by and between
HomeStore.com, Inc., a Delaware corporation ('Company'), and M. Jeffrey Charney
('Executive').
WHEREAS, the Company desires to secure the services of Executive as Vice
President of Corporate Marketing and Communications and Executive desires to
perform such services for the Company, on the terms and conditions as set forth
herein;
NOW, THEREFORE, in consideration of the premises and of the covenants and
agreements set forth below, it is mutually agreed as follows:
1. Effective Date, Term and Duties. The term of employment of Executive by
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the Company hereunder shall commence on __________, 1999 (the 'Commencement
Date') and shall continue thereafter on the same terms and conditions (such
term being hereinafter referred to as the 'Employment Period') until
terminated pursuant to Section 4. Executive's employment with the Company
is on an 'at will' basis, and either Executive or the Company may terminate
Executive's employment with the Company at any time, for any or no reason.
Executive shall report to the Chief Executive Officer and shall have such
duties as the Chief Executive Officer may from time to time prescribe
consistent with his position as Vice President of Corporate Marketing and
Communications (the 'Services'). Executive shall devote his full time,
attention, energies and best efforts to the business. Notwithstanding the
foregoing, the Executive may (i) with the written permission of the Board
of Directors serve on corporate boards, (ii) serve on civic or charitable
boards or committees, (iii) manage personal investments and (iv) deliver
lectures and teach at educational institutions, so long as such activities
in clauses (i) through (iii) do not significantly interfere with the
performance of Executive's duties and responsibilities hereunder.
Additionally, Executive will be eligible for a change in title if similarly
situated executives are afforded same.
2. Compensation. The Company shall pay and Executive shall accept as full
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consideration for the Services compensation consisting of the following:
2.1 Base Salary. $160,000.00 per year base salary, payable in bi-
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monthly installments in accordance with the Company's normal payroll
practices, less such deductions or withholdings required by law.
2.2 Bonus. Executive will be eligible to earn an annual target bonus
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in the amount of thirty percent (30%) of Executive's base salary based
on the achievement of certain business and financial objectives that
Executive and the Company's Chief Executive Officer will mutually
determine in good faith. The objectives for Executive's first year
will be determined promptly after the execution of this Agreement;
objectives for future years will be determined
promptly after the beginning of each fiscal year of the Company. Such
bonus shall be paid annually in accordance with the Company's Annual
Incentive Program. Executive's bonus will not be subject to a prorated
maximum for partial service in 1999, and will be eligible to receive a
bonus amount greater than the target of 30% at the discretion of the
Chief Executive Officer.
2.3 Stock Options. Executive shall be entitled to a stock option
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grant of 100,000 shares of HomeStore.com, Inc.'s Common Stock under
the Company's 1999 Stock Option Plan to be awarded by the Compensation
Committee of the Company's Board of Directors within thirty (30) days
after the date hereof (the 'Option'). Such Option shall be granted at
the fair market value by the Board of Directors and shall have a ten-
year term, unless earlier terminated as set forth in the stock option
agreement. Options shall vest as to twenty percent (20%) of the shares
on the first anniversary of the Commencement Date and monthly
thereafter for the remaining four years until such Option is vested
with respect to 100% of the shares, unless earlier terminated as set
forth in the stock option agreement. The Option may be exercised at
any time on or after the date of grant subject to the Company's right
to repurchase unvested shares upon Executive's termination of
employment as set forth in the stock option agreement.
2.4 Benefits and Expenses. Executive will receive the Company's
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customary employee benefits package for similarly situated executives
of the Company, including full participation in current and future
group health insurance plans. Executive shall be entitled to vacation
in accordance with the policies as periodically established by the
Board of Directors for similarly situated executives of the Company,
which shall in no event be less than three weeks per anniversary year.
The Company shall reimburse the Executive for all reasonable travel
and other business expenses incurred by him in connection with the
performance of the Executive's duties under this Agreement during the
Employment Period.
2.5 3-Month Review. Executive will be entitled to a review of his
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performance and compensation package within 3-months of commencement
date.
3. Benefits Upon Termination of Employment Period. Executive's employment by
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the Company shall terminate immediately upon Executive's receipt of written
notice by the Company, upon the Company's receipt of written notice by
Executive, or upon Executive's death or permanent disability.
4. Termination of Employment Period. If, within one year from commencement
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date, Executive's employment should be terminated by the Company for any
reason other than for 'Cause' (as defined below), Executive shall receive 6
months severance pay, plus any earned bonus payment and be provided a total
of one year (or 20%) accelerated option vesting.
4.1 Definitions. For purposes of this Agreement, 'Cause' means (a)
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conviction of the Executive for (i) any crime constituting a felony in
the jurisdiction in which committed, (ii) any crime involving moral
turpitude (whether or not a felony), or (iii) any other criminal act
against the Company involving dishonesty or willful misconduct
intended to injure the Company (whether or not a felony) or (b)
willful malfeasance or gross misconduct by the Executive which damages
the Company; provided, however, that the Company shall not be deemed
to have Cause pursuant to clause (b) unless the Company gives the
Executive written notice that the specified conduct or event has
occurred and the Executive fails to cure the conduct or event within
thirty (30) days after receipt of such notice. Termination of the
Executive for Cause shall be communicated by a Notice of Termination.
5. Cooperation with the Company After Termination of the Employment Period.
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Following termination of the Employment Period by Executive, subject to
Executive's employment duties with a subsequent employer, Executive shall
fully cooperate with the Company in all matters relating to the winding up
of his pending work on behalf of the Company and the orderly transfer of
any such pending work to other employees of the Company as may be
designated by the Company.
6. Confidentiality/Non-Solicitation. Executive acknowledges that as an
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employee of the Company, Executive will have access to certain Company
confidential information and Executive may, during the course of
Executive's employment, develop certain information that will be the
property of the Company. To protect the interest of the Company, Executive
agrees to sign the Company's standard Confidentiality Agreement as a
condition of Executive's employment. In addition, the Executive agrees
with the Company that during him employment with the Company and for a
period expiring two (2) years after the date of termination of such
employment, he will not solicit any of the Company's then-current employees
to terminate their employment with the Company or to become employed by any
firm, company or other business enterprise with which the Executive may
then be connected.
7. General.
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7.1 Severability. If for any reason a court of competent
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jurisdiction or arbitrator finds any provision of this Agreement to be
unenforceable, the provision shall be deemed amended as necessary to
conform to applicable laws or regulations, or if it cannot be so
amended without materially altering the intention of the parties, the
remainder of the Agreement shall continue in full force and effect as
if the offending provision were not contained herein.
7.2 Notices. All notices and other communications required or
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permitted to be given under this Agreement shall be in writing and
shall be considered effective upon personal service or upon depositing
such notice in the U.S. Mail, postage prepaid, return receipt
requested and addressed to the Chairman of the Board of
the Company as its principal corporate address, and to Executive at
him most recent address shown on the Company's corporate records, or
at any other address which he may specify in any appropriate notice to
the Company.
7.3 Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed an original and all of
which taken together constitutes one and the same instrument and in
making proof hereof it shall not be necessary to produce or account
for more than one such counterpart.
7.4 Entire Agreement. The parties hereto acknowledge that each has
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read this Agreement, understands it, and agrees to be bound by its
terms. The parties further agree that this Agreement and the
referenced stock option agreement constitute the complete and
exclusive statement of the agreement between the parties and
supersedes all proposals (oral or written), understandings,
representations, conditions, covenants, and all other communications
between the parties relating to the subject matter hereof.
7.5 Governing Law. This Agreement shall be governed by the law of
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the State of California.
7.6 Assignment and Successors. The Company shall have the right to
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assign its rights and obligations under this Agreement to an entity
which acquires substantially all of the assets of the Company. The
rights and obligation of the Company under this Agreement shall inure
to the benefit and shall be binding upon the successors and assigns of
the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.
HOMESTORE.COM, INC. EXECUTIVE
/s/ M. Jeffrey Charney
By: /s/ Stuart H. Wolff, Ph.D. ______________________
Name: Stuart H. Wolff, Ph.D. M. Jeffrey Charney
Title: Chairman and Chief Executive Officer Date: _________________
Date: ______________
By: /s/ Catherine Kwong Giffen
Name: Catherine Kwong Giffen
Title: Vice President of HR and Administration
Date: _______________
Employment Agreement - Homestore.com Inc. and M. Jeffrey Charney
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