Stamps.com Inc.
|
(Exact name of registrant as specified in its charter)
|
Delaware
|
000-26427
|
77-0454966
|
(State or other jurisdiction of incorporation)
|
(Commission File Number)
|
(IRS Employer Identification No.)
|
1990 E. Grand Avenue, El Segundo, CA
|
90245
|
(Address of principal executive offices)
|
(Zip Code)
|
Not Applicable
|
(Former name or former address, if changed since last report)
|
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
99.1 |
Press Release of Stamps.com Inc. dated August 2, 2017, announcing Stamps.com Inc.'s financial results for its fiscal quarter ended June 30, 2017. (furnished, not filed)
|
99.2 |
Consulting Agreement, dated as of July 31, 2017, between the Company and James Bortnak.
|
99.3 |
Press Release of Stamps.com Inc. dated August 2, 2017, announcing the appointment of certain officers. (furnished, not filed)
|
Stamps.com Inc.
|
||||
(Registrant)
|
||||
August 2, 2017
|
/s/ Kenneth McBride
|
|||
Date
|
(Signature)
|
|||
Kenneth McBride,
|
||||
Chief Executive Officer
|
Investor Contact:
|
Press Contact:
|
Jeff Carberry
|
Eric Nash
|
Stamps.com Investor Relations
|
Stamps.com Public Relations
|
(310) 482-5830
|
(310) 482-5942
|
invrel@stamps.com
|
enash@stamps.com
|
· |
Total revenue was $116.1 million, up 38% compared to $84.0 million in the second quarter of 2016.
|
· |
GAAP net income was $31.0 million, up 117% compared to $14.3 million in the second quarter of 2016.
|
· |
GAAP net income per fully diluted share was $1.71, up 118% compared to $0.79 in the second quarter of 2016.
|
· |
Non-GAAP adjusted EBITDA was $58.1 million, up 52% compared to $38.2 million in the second quarter of 2016.
|
· |
Non-GAAP adjusted income per fully diluted share was $2.08, up 62% compared to $1.29 (as adjusted) in the second quarter of 2016.
|
Second Quarter Fiscal 2017
All amounts in millions except
per share data:
|
GAAP Amounts
|
Stock-Based
Compensation
Expense
|
Intangible Amortization Expense
|
Debt Amortization Expense
|
Income Tax Adjustments
|
Non-GAAP Amounts
|
||||||||||||||||||
Cost of Revenues
|
$
|
19.09
|
$
|
0.45
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
18.64
|
||||||||||||
Research & Development
|
11.63
|
2.22
|
-
|
-
|
-
|
9.41
|
||||||||||||||||||
Sales & Marketing
|
22.28
|
1.97
|
-
|
-
|
-
|
20.31
|
||||||||||||||||||
General & Administrative
|
21.45
|
6.33
|
4.00
|
-
|
-
|
11.13
|
||||||||||||||||||
Total Expenses
|
74.45
|
10.97
|
4.00
|
-
|
-
|
59.48
|
||||||||||||||||||
Income (Loss) from Operations
|
41.69
|
(10.97
|
)
|
(4.00
|
)
|
-
|
-
|
56.66
|
||||||||||||||||
Interest and Other Income (Loss)
|
(0.77
|
)
|
-
|
-
|
(0.09
|
)
|
-
|
(0.68
|
)
|
|||||||||||||||
Benefit (Expense) for Income Taxes
|
(9.88
|
)
|
-
|
-
|
-
|
8.31
|
(18.19
|
)
|
||||||||||||||||
|
||||||||||||||||||||||||
Adjusted Income (Loss)
|
31.04
|
(10.97
|
)
|
(4.00
|
)
|
(0.09
|
)
|
8.31
|
37.79
|
|||||||||||||||
|
||||||||||||||||||||||||
On a diluted per share basis
|
$
|
1.71
|
$
|
(0.61
|
)
|
$
|
(0.22
|
)
|
$
|
(0.01
|
)
|
$
|
0.46
|
$
|
2.08
|
|||||||||
Shares used in per share calculation
|
18.12
|
18.12
|
18.12
|
18.12
|
18.12
|
18.12
|
Second Quarter Fiscal 2016 (Recast)
All amounts in millions except
per share data:
|
GAAP Amounts
|
Stock-Based
Compensation
Expense
|
Intangible Amortization Expense
|
Acquisition Related Expenses
|
Debt Amortization
|
Income Tax Adjustments
|
Non-GAAP Amounts
|
|||||||||||||||||||||
Cost of Revenues
|
$
|
13.72
|
$
|
0.45
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
13.27
|
||||||||||||||
Research & Development
|
8.13
|
1.42
|
-
|
-
|
-
|
-
|
6.71
|
|||||||||||||||||||||
Sales & Marketing
|
20.08
|
1.86
|
-
|
-
|
-
|
-
|
18.22
|
|||||||||||||||||||||
General & Administrative
|
17.11
|
4.68
|
3.24
|
0.52
|
-
|
-
|
8.67
|
|||||||||||||||||||||
Total Expenses
|
59.05
|
8.42
|
3.24
|
0.52
|
-
|
-
|
46.87
|
|||||||||||||||||||||
Income (Loss) from Operations
|
24.97
|
(8.42
|
)
|
(3.24
|
)
|
(0.52
|
)
|
-
|
-
|
37.14
|
||||||||||||||||||
Interest and Other Income (Loss)
|
(0.87
|
)
|
-
|
-
|
-
|
(0.09
|
)
|
-
|
(0.78
|
)
|
||||||||||||||||||
Pre-Tax Income (Loss)
|
24.09
|
(8.42
|
)
|
(3.24
|
)
|
(0.52
|
)
|
(0.09
|
)
|
-
|
36.36
|
|||||||||||||||||
Benefit (Expense) for Income Taxes
|
(9.80
|
)
|
-
|
-
|
-
|
-
|
3.18
|
(12.98
|
)
|
|||||||||||||||||||
|
||||||||||||||||||||||||||||
Adjusted Income (Loss)
|
14.29
|
(8.42
|
)
|
(3.24
|
)
|
(0.52
|
)
|
(0.09
|
)
|
3.18
|
23.38
|
|||||||||||||||||
|
||||||||||||||||||||||||||||
On a diluted per share basis
|
$
|
0.79
|
$
|
(0.46
|
)
|
$
|
(0.18
|
)
|
$
|
(0.03
|
)
|
$
|
(0.01
|
)
|
$
|
0.17
|
$
|
1.29
|
||||||||||
Shares used in per share calculation
|
18.19
|
18.19
|
18.19
|
18.19
|
18.19
|
18.19
|
18.19
|
Second Quarter
|
Three Months ended
|
|||||||
All amounts in millions
|
June 30,
|
|||||||
2017
|
2016
|
|||||||
GAAP Net Income (Loss)
|
$
|
31.04
|
$
|
14.29
|
||||
Depreciation and Amortization expense
|
$
|
5.40
|
$
|
4.33
|
||||
Interest & Other Expense (Income), net
|
$
|
0.77
|
$
|
0.87
|
||||
Income Tax Expense (Benefit), net
|
$
|
9.88
|
$
|
9.80
|
||||
Stock-based Compensation Expense
|
$
|
10.97
|
$
|
8.42
|
||||
Acquisition Related Expenses
|
$
|
--
|
$
|
0.52
|
||||
Adjusted EBITDA
|
$
|
58.06
|
$
|
38.24
|
· |
We expect total 2017 revenue to be in a range of approximately $435 million to $460 million; this compares to previous guidance of $405 million to $430 million.
|
· |
We expect GAAP net income per fully diluted share to be in a range of approximately $5.15 to $6.07; this compares to previous guidance of $4.78 to $5.69.
|
· |
We expect non-GAAP adjusted EBITDA to be in a range of approximately $220 million to $240 million; this compares to previous guidance of $205 million to $225 million.
|
· |
We expect non-GAAP adjusted income per fully diluted share to be in a range of $7.50 to $8.50; this compares to previous guidance of $7.00 to $8.00.
|
Fiscal Year 2017 Guidance
|
||||||||
All amounts in millions
|
Low End of Range
|
High End of Range
|
||||||
GAAP net income
|
$
|
97.3
|
$
|
110.8
|
||||
Adjustments to reconcile adjusted EBITDA to GAAP net income:
|
||||||||
Executive consulting expense
|
$
|
6.1
|
$
|
6.1
|
||||
Insurance proceeds gain
|
$
|
(2.2
|
)
|
$
|
(2.2
|
)
|
||
Depreciation and amortization expense
|
$
|
22.0
|
$
|
22.0
|
||||
Stock-based compensation expense
|
$
|
45.5
|
$
|
45.5
|
||||
Interest expense and other income, net
|
$
|
4.5
|
$
|
4.5
|
||||
Income tax expense
|
$
|
46.8
|
$
|
53.3
|
||||
Total adjustments excluded from adjusted EBITDA
|
$
|
122.7
|
$
|
129.2
|
||||
Adjusted EBITDA
|
$
|
220.0
|
$
|
240.0
|
Fiscal Year 2017 Guidance
|
||||||||
All amounts in millions except per share data
|
Low End of Range
|
High End of Range
|
||||||
GAAP net income per fully diluted share
|
$
|
5.15
|
$
|
6.07
|
||||
Adjustments to reconcile non-GAAP to GAAP:
|
||||||||
Executive consulting expense
|
$
|
6.1
|
$
|
6.1
|
||||
Insurance proceeds gain
|
$
|
(2.2
|
)
|
$
|
(2.2
|
)
|
||
Stock-based compensation expense
|
$
|
45.5
|
$
|
45.5
|
||||
Amortization of acquired intangibles
|
$
|
16.0
|
$
|
16.0
|
||||
Amortization of debt issuance costs
|
$
|
0.4
|
$
|
0.4
|
||||
Total adjustments excluded from non-GAAP
|
$
|
65.8
|
$
|
65.8
|
||||
Effective tax rate
|
32.5
|
%
|
32.5
|
%
|
||||
Increased tax expense from non-GAAP adjustments
|
$
|
21.4
|
$
|
21.4
|
||||
Total tax effected adjustments excluded from non-GAAP
|
$
|
44.4
|
$
|
44.4
|
||||
Fully diluted shares
|
18.9
|
18.3
|
||||||
Total adjustments excluded from non-GAAP adjusted income per fully diluted share
|
$
|
2.35
|
$
|
2.43
|
||||
Non-GAAP adjusted income per fully diluted share
|
$
|
7.50
|
$
|
8.50
|
Three Months ended
June 30,
|
Six Months ended
June 30,
|
|||||||||||||||
2017
|
2016
|
2017
|
2016
|
|||||||||||||
Revenues:
|
||||||||||||||||
Service
|
$
|
102,685
|
$
|
72,590
|
$
|
195,105
|
$
|
141,696
|
||||||||
Product
|
4,763
|
4,851
|
10,477
|
10,406
|
||||||||||||
Insurance
|
4,393
|
4,082
|
8,833
|
8,593
|
||||||||||||
Customized postage
|
4,276
|
2,467
|
6,718
|
5,104
|
||||||||||||
Other
|
23
|
23
|
47
|
51
|
||||||||||||
Total revenues
|
116,140
|
84,013
|
221,180
|
165,850
|
||||||||||||
Cost of revenues:
|
||||||||||||||||
Service
|
12,726
|
8,857
|
25,402
|
18,151
|
||||||||||||
Product
|
1,593
|
1,642
|
3,395
|
3,440
|
||||||||||||
Insurance
|
1,213
|
1,266
|
2,581
|
2,629
|
||||||||||||
Customized postage
|
3,557
|
1,955
|
5,449
|
4,122
|
||||||||||||
Total cost of revenues
|
19,089
|
13,720
|
36,827
|
28,342
|
||||||||||||
Gross profit
|
97,051
|
70,293
|
184,353
|
137,508
|
||||||||||||
Operating expenses:
|
||||||||||||||||
Sales and marketing
|
22,280
|
20,082
|
45,430
|
41,479
|
||||||||||||
Research and development
|
11,628
|
8,131
|
22,150
|
16,468
|
||||||||||||
General and administrative
|
21,451
|
17,113
|
40,433
|
32,375
|
||||||||||||
Total operating expenses
|
55,359
|
45,326
|
108,013
|
90,322
|
||||||||||||
Income from operations
|
41,692
|
24,967
|
76,340
|
47,186
|
||||||||||||
Interest expense
|
(932
|
)
|
(905
|
)
|
(1,812
|
)
|
(1,820
|
)
|
||||||||
Interest income and other income
|
159
|
31
|
189
|
74
|
||||||||||||
Income before income taxes
|
40,919
|
24,093
|
74,717
|
45,440
|
||||||||||||
Income tax expense
|
9,879
|
9,802
|
10,539
|
17,911
|
||||||||||||
Net income
|
$
|
31,040
|
$
|
14,291
|
$
|
64,178
|
$
|
27,529
|
||||||||
Net income per share:
|
||||||||||||||||
Basic
|
$
|
1.83
|
$
|
0.82
|
$
|
3.79
|
$
|
1.58
|
||||||||
Diluted
|
$
|
1.71
|
$
|
0.79
|
$
|
3.54
|
$
|
1.49
|
||||||||
Weighted average shares outstanding:
|
||||||||||||||||
Basic
|
16,930
|
17,384
|
16,916
|
17,370
|
||||||||||||
Diluted
|
18,125
|
18,192
|
18,147
|
18,428
|
June 30,
|
December 31,
|
|||||||
2017
|
2016
|
|||||||
ASSETS
|
||||||||
Cash and investments
|
$
|
110,343
|
$
|
108,443
|
||||
Accounts receivable
|
65,897
|
62,756
|
||||||
Other current assets
|
23,188
|
13,081
|
||||||
Property and equipment, net
|
38,199
|
36,829
|
||||||
Goodwill and intangible assets, net
|
328,714
|
336,732
|
||||||
Deferred taxes, net
|
45,044
|
48,782
|
||||||
Other assets
|
5,127
|
3,506
|
||||||
Total assets
|
$
|
616,512
|
$
|
610,129
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Liabilities:
|
||||||||
Accounts payable and accrued expenses
|
$
|
75,503
|
$
|
86,205
|
||||
Debt, net of debt issuance costs
|
134,447
|
147,354
|
||||||
Deferred revenue
|
3,851
|
3,858
|
||||||
Total liabilities
|
$
|
213,801
|
$
|
237,417
|
||||
Stockholders' equity:
|
||||||||
Common stock
|
54
|
53
|
||||||
Additional paid-in capital
|
907,787
|
855,344
|
||||||
Treasury Stock
|
(341,699
|
)
|
(252,981
|
)
|
||||
Accumulated deficit
|
(163,438
|
)
|
(229,715
|
)
|
||||
Accumulated other comprehensive income
|
7
|
11
|
||||||
Total stockholders' equity
|
402,711
|
372,712
|
||||||
Total liabilities and stockholders' equity
|
$
|
616,512
|
$
|
610,129
|
1. |
Separation of Employment; Interim Period; Special Bonus
. Consultant’s last day of employment with the Company shall be September 30, 2017 (“the Separation Date”). Between the Effective Date and the Separation Date (the “Interim Period”), Consultant shall remain employed by the Company, receiving as sole compensation his current base salary rate and benefits, which shall continue to be payable in accordance with the current terms and manner of payment. The Company shall pay Consultant a special, one-time bonus of $1,000,000.00, less legally required tax withholdings, which shall be paid in a single lump sum payment within five (5) business days after the Effective Date. In addition, the Company shall pay Consultant additional amounts in the aggregate equal to $3,197,363.27 (“Additional Bonus”), which shall be paid in thirty-six (36) equal monthly installments, less legally required tax withholdings, over a thirty-six (36) consecutive month period, with the first installment paid on the Company’s first payroll date that falls immediately after October 15, 2017, and subsequent installments paid on the corresponding monthly payroll date during each of the next thirty five (35) months thereafter, all in accordance with the Company’s normal payroll practices. The Company and Consultant agree that the special, one-time bonus and the Additional Bonus do not relate in any way to the Services to be provided pursuant to Section 2(b) below.
|
2. |
Consulting Arrangement.
The Company shall retain Consultant as a consultant in the manner and for the period of time described below.
|
3. |
Warranty
. Other than the payments and consideration set forth in this Agreement that are to be provided on or after the Effective Date, Consultant acknowledges that he has received all monies and other benefits due him as a result of his employment with and separation from the Company, including payment for any accrued but unused vacation time and reimbursement for any appropriately incurred work-related expenses.
|
4. |
Release of Claims by Consultant
.
|
(a) |
Consultant acknowledges and agrees that the foregoing consideration represents settlement in full of all outstanding obligations alleged to be owed to him by the Company with respect to his employment and the termination of his employment relationship with the Company. Consultant, on behalf of himself and his representatives, agents, heirs and assigns, waives, releases, discharges and promises never to assert any and all claims, liabilities, obligations or causes of action (whether contract, tort, property, statutory, common law, securities, tax or any other legal theory) relating to any matters of any kind and nature, whether known or unknown, suspected or unsuspected, that he ever had, now has or might have, in any capacity (employee, stockholder or otherwise), arising from or related to any omissions, acts or facts that have occurred up until and including the Effective Date against the Company, its predecessors, successors, affiliated entities, shareholders, investors, agents, attorneys, directors, officers, employees or assigns. Consultant will reaffirm Paragraph 4 and the releases herein in writing as of, and through, the Separation Date, in the form of Exhibit A.
|
(i) |
any and all claims for wages, compensation, bonuses, severance, benefits, wrongful discharge of employment; breach of contract, both expressed and implied; breach of a covenant of good faith and fair dealing, both expressed and implied; negligent or intentional infliction of emotional distress; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; retaliation, fraud; interference with contractual relationships; and defamation;
|
(ii) |
any and all claims for violation of any federal, state or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination in Employment Act of 1967, as amended by the Older Workers Benefits Protection Act of 1990 (“the ADEA”), Section 1981 of Title 42 of the United States Codes, the Employee Retirement Income Security Act of 1974, the Fair Labor Standards Act, the Federal Family and Medical Leave Act, the California Family Rights Act, the California Labor Code, the California Fair Employment and Housing Act, and related discrimination statutes and ordinances, and any and all claims arising out of any other laws and regulations relating to employment or employment discrimination;
|
(iii) |
any and all claims for attorneys’ fees and costs;
|
(iv) |
any and all claims for equity awards, equity interests, stock options, shares of any class or series of capital stock, or any securities of the Company of any kind except as provided in this Agreement;
|
(v) |
any and all claims arising from or related to Consultant’s ownership of stock, options or other securities of the Company;
|
(vi) |
any and all claims for fraud (common law or other) and any and all claims arising under US, state or foreign laws, rules, statutes and regulations, including corporate, antitrust, tax or securities laws;
|
(vii) |
any and all claims for ownership of any Company property or assets; and
|
(viii) |
Consultant further acknowledges that he is not suffering from any work related injuries or ailments that would give rise to a claim under California’s Workers’ Compensation Act or any similar law.
|
5. |
Release of Claims by the Company
.
|
6. |
Civil Code Section 1542 or Similar Statute
. The Parties represent that they are not aware of any claims against each other, other than the claims that are released by Paragraphs 4 and 5 of this Agreement. All Parties hereto expressly acknowledge and agree that the releases herein are general in nature and as broad as may be granted under applicable law, and that this Agreement fully and finally settles and forever resolves all of the claims released hereby, even those which are unknown, unanticipated or unsuspected. Upon the advice of legal counsel, the Parties hereto hereby acknowledge that they understand, and expressly waive, all benefits and protections under Section 1542 of the Civil Code of California, as well as under any other statutes, legal decisions or common law principles of similar effect to the extent that such benefits or protections may contravene the provisions of this Agreement. Section 1542 of the Civil Code of California states:
|
7. |
Continuing Effect of Confidentiality Agreement
. All of the requirements of the Confidential Information and Invention Assignment Agreement previously entered into between Consultant and the Company on or about October 6, 1999 (“Confidentiality Agreement”) remain in full force and effect, binding on Consultant and shall continue to apply throughout the Consulting Period, as well as thereafter in accordance with the terms thereof, it being understood that the “Relationship” referred to therein is continuing during the Consulting Period. Consultant represents and warrants that he has complied with his obligations under that Confidentiality Agreement, there have been no amendments thereto and that he will continue to comply with such obligations in accordance with the terms thereof. The Company and Consultant agree that although the “Relationship” referred to therein shall continue during the Consulting Period, Consultant shall nevertheless return property (including, without limitation, mobile phones, computers, physical and electronic files, documents, emails and other communications, and all other tangible and intangible property belonging to the Company) and deliver a Termination Certificate, as required by Section 5 of the Confidentiality Agreement, upon the Effective Date and, upon request of the Company, again at the conclusion of the Consulting Period. For the avoidance of doubt, this Agreement controls over any “employment at-will” provisions in the Confidentiality Agreement.
|
8. |
Cooperation.
As part of this Agreement, without additional compensation, Consultant agrees reasonably to cooperate with the Company in the prosecution or defense of all threatened claims or actual litigation in which the Company is or may become a party, whether now pending or hereafter brought, in which Consultant has knowledge of relevant facts or issues. This cooperation may include, but is not limited to, conferring with and assisting the Company in preparatory work in litigation matters and providing factual information to the Company. The Company will promptly reimburse the Consultant for any out-of-pocket expenses reasonably incurred by him to provide the cooperation requested under this Paragraph 8.
|
9. |
Governing Law
. This Agreement shall be construed under the laws of the State of California, both procedural and substantive.
|
10. |
Waiver
. The failure to enforce any provision of this Agreement shall not be construed to be a waiver of such provision or to affect the validity of this Agreement or the right of any party to enforce this Agreement.
|
11. |
Modification
. No amendments to this Agreement will be valid unless written and signed by Consultant and the Chief Executive Officer or other authorized representative of the Company.
|
12. |
Severability
. If any sentence, phrase, paragraph, subparagraph or portion of this Agreement is found to be illegal or unenforceable, such action shall not affect the validity or enforceability of the remaining sentences, phrases, paragraphs, subparagraphs or portions of this Agreement; provided, however, that if a court of competent jurisdiction or arbitrator holds that Paragraphs 4 or 5 and/or (in relation to Paragraphs 4 or 5), Paragraph 6 are substantially and materially illegal, invalid, or unenforceable, then this Agreement shall become null and void, and no further Consulting Fee that is not yet paid shall be required to be paid pursuant to Paragraph 2 (and its subparts) above.
|
13. |
Confidentiality of Agreement
. The Parties agree: (i) not to disclose the existence of this Agreement or any of its terms, or any facts, circumstances, writings, documents or events leading up to or relating to this Agreement, to anyone other than their respective attorneys, accountants and, in the case of Consultant, immediate family members; (ii) to keep all such matters referred to in clause (i) strictly confidential; and (iii) that they will inform such attorneys, accountants and immediate family members about this confidentiality provision and be responsible for any breach by them hereof as if they were parties hereto; provided, however, solely to the extent compelled by an order of a court of competent jurisdiction or a subpoena issued under the authority thereof or other governmental authority having statutory or other jurisdiction to compel disclosure, a Party may disclose only such portion of such items as, upon written advice of counsel, it or he is so compelled by law to disclose if, prior to any such disclosure, the Company or Consultant, as applicable, (unless prohibited by law) first notifies the other Party in writing and reasonably cooperate with the other Party, at such Party’s expense, to obtain confidential treatment or other appropriate protection to ensure the confidentiality of such matters. The Parties agree that this confidentiality obligation is a material term of this Agreement. Notwithstanding the foregoing, the (i) Company may publicly disclose all or a portion of this Agreement by a filing with the SEC (if the Company determines it is legally required to do so, as it presently believes to be the case) and only that public information shall no longer be subject to this Paragraph 13, (ii) Consultant may disclose such confidential information only to the extent required to satisfy tax and immigration legal requirements, and (iii) Consultant’s Agency Reporting Rights are not limited by this Paragraph.
|
14. |
Expenses
. Each Party shall bear its own fees, costs and expenses (legal or otherwise) in connection with this Agreement and any and all related matters (including any expenses that relate to this Agreement or any circumstance related hereto that could be reimbursable under any other agreement with or policy of the Company); provided however, that on the Effective Date, the Company agrees to reimburse Consultant for solely those legal fees that are shown as the “Total This Invoice” on that certain invoice, number 3063291, received by the Company on the date hereof, and dated the date hereof, from his counsel, entitled “Total Paragraph 14 Invoice,” but no other fees, costs or expenses (legal or otherwise).
|
15. |
Non-solicitation of Employees.
The non-solicitation provisions of the Confidentiality Agreement shall remain in full force and effect both during the Consulting Period and for a period of twenty-four (24) months after the end of the Consulting Period.
|
16. |
Non-Disparagement.
Consultant agrees that he will not make any negative, disparaging, detrimental or derogatory remarks or comments to any third party concerning the Company, or its current and former officers, directors, employees, agents, representatives, affiliates or subsidiaries or products. The Company agrees that no member of its Board of Directors or any executive officer will, and no agent or other employee who has been authorized by the Company to speak for it concerning Consultant will, make any negative, disparaging, detrimental or derogatory comments to any third party concerning Consultant. The Parties agree that any statements a Party makes regarding Consultant’s departure shall be materially consistent with the mutually agreed press release issued on or about the date hereof regarding Consultant’s separation from the Company. Nothing contained in this Paragraph or Agreement shall prevent (i) Consultant’s Agency Reporting Rights or (ii) either Consultant or the Company from making truthful statements regarding the other to any governmental entity or regulatory agency where compelled by legal process in the form of a court order, an order from a regulatory agency or similar legal process, or where required by the rules and regulations of the Securities and Exchange Commission. If any Party believes that the other party has breached this Paragraph, and intends to seek to remedy such alleged breach, such Party shall first be required to contact the other Party and request a retraction or other appropriate response prior to commencing any action to enforce this Paragraph. Additionally, any ensuing action to enforce this Paragraph shall be limited to actual damages and/or equitable relief designed to stop violations of this Paragraph, but shall not in any way seek to invalidate or otherwise impair the releases, financial obligations or other provisions of this Agreement, and no Party shall be required to accept any remedy that invalidates or impairs this Agreement’s release provisions, financial obligations or any other provisions of this Agreement.
|
17. |
Entire Agreement/Integration
. This Agreement, the Confidentiality Agreement and the Option Agreements together constitute the entire agreement between Consultant and the Company concerning the terms of Consultant’s employment with and separation from the Company and the compensation related thereto. No other covenants, agreements, representations, or warranties of any kind have been made to any Party hereto with respect to such matters. All prior discussions and negotiations regarding such matters have been and are merged and integrated into, and are superseded by, this Agreement. Without limiting the foregoing, this Agreement specifically supersedes any existing separation terms and any existing or prior agreements between Consultant and the Company relating to such matters (other than the Confidentiality Agreement, the D&O Indemnity Agreement and the Option Agreements), which shall not be of any force or effect. Nothing herein supersedes or affects the Confidentiality Agreement, the D&O Indemnity Agreement or the Option Agreements, which remain in full force and effect in accordance with their terms.
|
18. |
Arbitration; Jurisdiction
. Any and all disputes or claims arising out of or in any way related to Consultant’s employment with or separation from the Company or this Agreement including, without limitation, fraud in the inducement of this Agreement, or relating to this Agreement (including validity, enforcement or otherwise), shall be resolved exclusively through binding arbitration at a mutually convenient office of JAMS or other mutually agreeable alternative dispute resolution service in Los Angeles, California, in accordance with the rules of that body; provided, a Party may seek provisional remedies, including injunctive relief, pursuant to California Code of Civil Procedure §1281.8(b) in a court of law, but in doing so, must file under seal to the maximum extent permitted by law without materially compromising their position. A Party will initiate arbitration by sending written notice of an intent to arbitrate by registered or certified mail to all parties and to JAMS or the different service mutually selected. The notice must contain a description of the dispute, the amount involved and the remedy sought. Each Party shall be responsible for its own costs and attorney’s fees incurred by reason of such arbitration. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The Parties shall request, to the maximum extent possible under JAMS rules and applicable law, that the arbitration be conducted confidentially, and each shall take all reasonable steps to preserve such confidentiality. Subject to the foregoing requirements as to arbitration, each Party hereby consents to the exclusive jurisdiction of the Federal courts of the United States sitting in the state of California in any action on a claim between or among any of the Parties arising out of, under or in connection with this Agreement or the transactions contemplated by this Agreement. If, for any reason, such Federal courts will not or cannot hear any such action or proceeding, it may only be brought and enforced in the state courts of California. Each Party further agrees that personal jurisdiction over him or it may be effected by service of process by registered or certified mail addressed as provided in this Agreement, and that when so made, shall be as if served upon him or it personally within the state of California.
|
19. |
Voluntary Execution of the Agreement
. Consultant acknowledges that he is entering into this Agreement knowingly and voluntarily, with the full intent of releasing all known and unknown claims against the Company and without any duress or undue influence. Consultant acknowledges that he has been advised of his right to consult with counsel of his choice regarding the terms of this Agreement. Consultant further acknowledges that (i) he has read this entire Agreement, (ii) he understands the terms and consequences of this Agreement and of the releases it contains; (iii) he is fully aware of the legal and binding effect of this Agreement; (iv) he acknowledges that he is knowingly and voluntarily waiving and releasing any rights that he may have under the ADEA, as amended; and (v) that the consideration he is receiving is in addition to anything of value to which he was already entitled.
|
20. |
Immigration Status
. The Company agrees that, during the Interim Period and the Consulting Period, it will take any and all commercially reasonable and necessary steps generally consistent with its past immigration practice for Consultant to support Consultant’s legal employment and immigration status within the United States, including such commercially reasonable additional steps requested by Consultant in writing even if not previously taken by Company on behalf of Consultant as an employee. Commencing immediately after the Effective Date, Company agrees to promptly prepare and provide to Consultant substantially the same immigration documentation prepared by, and take substantially the same immigration actions previously taken by, the Company consistent with its past practice for Consultant, in form and content approved by Consultant, reasonably required to sponsor Consultant for a TN visa under the “management consultant” category, including, without limitation, filing any required petition documents and reasonably cooperating with the applicable U.S. immigration authorities, and agrees to take such other commercially reasonable actions otherwise to support and facilitate Consultant’s efforts to secure an appropriate U.S. immigration visa permitting Consultant to perform the Services. Consultant will provide true and accurate information to Company for inclusion on such documents. If and to the extent there is any period of time during the Consulting Period, up to 180 days (the “Suspension Period”), when Consultant is not eligible to provide Services under applicable U.S. immigration law (“Non-Eligibility”), Consultant’s obligation to provide Services (but not Consultant’s obligation to comply with all of the other provisions of this Agreement), and all of the Company’s related obligations to pay Consulting Fees, may, at Consultant’s option upon advance written notice, be suspended for up to the duration of the Suspension Period and the Parties shall reasonably cooperate in Consultant’s efforts to obtain an appropriate U.S. visa, at which time his obligation to provide Services and the related payment obligations under this Agreement will be reinstated, with an additional period of Service equal to the portion of the Suspension Period during which such obligation were suspended, and the monthly payments hereunder shall resume, and shall be adjusted accordingly, based on the number of months remaining in the Consulting Period as extended by such portion of the Suspension Period, so that all payments required to be made hereunder have been made by the end of the Consulting Period as extended by such portion of the Suspension Period. Notwithstanding any other provisions of this Agreement to the contrary, if Consultant is unable to obtain an appropriate U.S. visa permitting him to perform the Services within the U.S. he may, at his option (and, if the Suspension Period has been fully utilized, shall), provide the Services from outside of the U.S. and all obligations of the Parties under this Agreement will remain in full force and effect, (ii) (ii) Consultant agrees that nothing in this Paragraph requires the Company to spend any amounts of money (except to the extent of its personnel complying with the Company’s obligations hereunder) or take any legal positions adverse to the Company, and (iii) Company shall have only contractual obligations, as set forth in this Paragraph, related to the matters discussed in this Paragraph and has no duty of care or otherwise to Consultant regarding such matters, and Consultant agrees that the Company does not assure and is not responsible for the outcome of any immigration decision by the government.
|
21. |
Review Period
. Consultant acknowledges that he has been advised that he has twenty-one (21) days to consider this Agreement and that he was informed that he has the right to consult with counsel regarding this Agreement, was encouraged by the Company to consult with counsel, and specifically was represented by counsel during the course of the negotiation of this Agreement. To the extent Consultant has taken fewer than twenty-one (21) days to consider this Agreement, Consultant acknowledges that he has had sufficient time to consider this Agreement and to consult with his counsel and that he does not desire additional time.
|
22. |
Right to Revoke
. This Agreement is revocable by Consultant for a period of seven (7) days following Consultant’s execution of this Agreement. The revocation by Consultant of this Agreement must be in writing, must specifically revoke this Agreement, and must be received by the Company prior to the eighth (8
th
) day following the execution of this Agreement by Consultant. This Agreement becomes effective, enforceable and irrevocable on the eighth (8
th
) day following Consultant’s execution of the Agreement (the “Effective Date”).
|
23. |
No Admissions.
This Agreement does not constitute an admission of any kind by the Company or Consultant of any liability or that it or he violated any law or any duty to the other party.
|
24. |
Miscellaneous
. All headings herein are inserted only for convenience and ease of reference and are not to be considered in the construction or interpretation of any provision of this Agreement. No presumption or burden of proof or persuasion shall be implied by virtue of the fact that this Agreement was prepared by or at the request of a particular Party or its counsel. Numbered or lettered articles, paragraphs and subparagraphs herein contained refer to articles, paragraphs and subparagraphs of this Agreement unless otherwise expressly stated. Any notice to be given or to be served upon any party hereto in connection with this Agreement must be in writing (which may include facsimile and email) and will be deemed to have been given and received when delivered to the address, facsimile number or email address specified by the party to receive the notice. Any Party may, at any time by giving five business (5) days’ prior written notice to the other Party, designate any other address, facsimile number and/or email address in substitution of the foregoing address, facsimile number and/or email address to which such notice will be given. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument. The remedies under this Agreement are cumulative and shall not exclude any other remedies to which any person may be lawfully entitled. A Party shall be entitled to equitable or injunctive relief in addition to any remedies or damages available at law.
|
25. |
Payment
. Any payment to be made by Company to Consultant hereunder shall, at Consultant’s option expressed in writing to the Company and signed by Consultant, and effective as soon as reasonably practicable after such notice, be paid to an entity legal entity owned or controlled by Consultant or his immediate family. Consultant shall confirm that the entity is so owned or controlled in such notice.
|
James Bortnak
|
||
James Bortnak
|
||
Dated: July 31, 2017
|
||
Address for Notice:
|
||
[Omitted]
|
||
STAMPS.COM INC.
|
||
By:
|
||
Seth Weisberg, Chief Legal Officer
|
||
Dated: July 31, 2017
|
||
Address for Notice:
|
||
Stamps.com Inc.
|
||
1990 E. Grand Avenue
|
||
El Segundo, CA 90245
|
||
Attn: Seth Weisberg, Chief Legal Officer
|
Award ID
|
Award Date
|
Award Type
|
Award Amount
|
Award Price
|
Exercisable
|
Unvested
|
Outstanding
|
Vest Template
|
1669
|
09/19/2014
|
NQ
|
93,830
|
$32.410000
|
498
|
8,348
|
8,846
|
Equal through 24 months
|
1688
|
09/19/2014
|
NQ
|
46,915
|
$32.410000
|
15
|
0
|
15
|
Equal through 12 months
|
1911
|
04/09/2015
|
ISO
|
1,508
|
$66.280000
|
0
|
1,508
|
1,508
|
Equal through 36 mo.
|
1920
|
04/09/2015
|
NQ
|
18,492
|
$66.280000
|
10,555
|
7,937
|
18,492
|
Equal through 36 mo.
|
11,068
|
17,793
|
28,861
|
Investor Contact:
|
Press Contact:
|
Suzanne Park
|
Eric Nash
|
Stamps.com Investor Relations
|
Stamps.com Public Relations
|
(310) 482-5830
|
(310) 482-5942
|
invrel@stamps.com
|
enash@stamps.com
|