Offer Letter between the Registrant and John Watters, dated April 1, 2021

    

John Watters

(Via Email)

Dear John,

FireEye Inc., a Delaware corporation (the "Company"), is pleased to offer you employment on the following terms:

1.    Title. You will be employed as President and Chief Operating Officer, reporting to the Company’s Chief Executive Officer. This is a full-time position.

2.    Cash Compensation. You will receive an annual base salary of $600,000 per year, payable in accordance with the Company’s normal payroll practices and subject to normal withholding taxes. This salary will be subject to adjustment pursuant to the Company’s employee compensation policies in effect from time to time. In addition, you will be eligible to be considered for an incentive bonus for each fiscal year of the Company under the Company’s Employee Incentive Plan (the “Incentive Plan”) or any successor plan. The bonus (if any) will be awarded based on objective and/or subjective criteria established by the Company’s Chief Executive Officer and approved by the Company’s Board of Directors (the “Board”) and/or the Compensation Committee of the Board (the “Compensation Committee”), as applicable. Your initial annual target bonus will be equal to $600,000, bringing your total target cash compensation to $1,200,000 per year. The bonus is currently scheduled to be paid annually, and only if you are still employed by the Company at the time of payment. The terms and conditions of your bonus will be set forth in the Incentive Plan. The determinations of the Board and/or the Compensation Committee, as applicable, with respect to your bonus will be final and binding. Your cash compensation for 2021 will be pro-rated based on your first day of employment with the Company (your “Start Date”).

3.    Employee Benefits. You will be eligible to participate in the Company’s employee benefit plans made available to similarly situated employees of the Company so long as such plans are kept in force by the Company and provided you meet the eligibility requirements and other terms, conditions, and restrictions of such respective plans and programs.

4.    Equity Awards.

(a)    RSU Award.  Management of the Company (“Management”) will recommend that the Compensation Committee grant you restricted stock units convertible into 225,000 shares of the Company's Common Stock (the “RSUs”). The RSUs will be granted pursuant to the Company’s 2013 Equity Incentive Plan (the “2013 Plan”) and will be subject to the Company’s standard form of award agreement and Compensation Committee approval after the commencement of your employment. The RSUs will vest over a four year period from February 15, 2021, with 25% of the RSUs vesting on February 15, 2022 and 6.25% of the RSUs vesting each quarter thereafter over the remaining three years, in each case subject to your continued service to the Company through the applicable vesting date.

(b)    Initial PSU Award.  Management will also recommend that the Compensation Committee grant you restricted stock units with performance-based vesting for a target of 225,000 shares of the Company’s Common Stock (the “Initial PSUs”). The Initial PSUs will be granted pursuant to the 2013 Plan and will be subject to performance-based vesting as shall be approved by the Compensation Committee and set forth in your award agreement. Management will recommend that the Initial PSUs be tied to company performance measures for each of the FY2021-FY2023 performance years (i.e., 1/3 of the Initial PSUs being tied to FY2021 company performance, 1/3 being tied to FY2022 company performance, and 1/3 being tied to FY2023 company performance), in each case with the payout for a performance year vesting in full on the February 15th after the performance year and subject to your continued service to the Company through the applicable vesting date.

(c)    Additional PSU Award.  In addition, Management will recommend that the Compensation Committee grant you restricted stock units with performance-based vesting for a target of 300,000 shares of the Company’s Common Stock (the “Additional PSUs”). The Additional PSUs will be granted pursuant to the 2013 Plan and will be subject to performance-based vesting as shall be approved by the Compensation Committee and set forth in your award agreement. Management will recommend that (i) 100,000 shares under the Additional PSUs vest upon the first date, if any, after the date hereof on which the Company 30-Day Average Stock Price (as defined below) is equal or greater than $25.00, (ii) 100,000 shares under the Additional PSUs vest upon the first date, if any, after the date hereof on which the Company 10-Day Average Stock Price (as defined below) is equal or greater than $30.00, (iii) 50,000 shares under the Additional PSUs vest upon the first date, if any, after the date hereof on which the Company 10-Day Average Stock Price is equal or greater than $35.00, and (iv) 50,000 shares under the Additional PSUs vest upon the first date, if any, after the date hereof on which the Company 10-Day Average Stock Price is equal or greater than $40.00, in each case subject to your continued service to the Company through the applicable vesting date. As used herein, (i) the term “Company 30-Day Average Stock Price” shall mean, as of any measurement date, the price determined by calculating the average of the daily volume weighted average prices of a share of the Company's common stock on the NASDAQ Global Select Market as determined on each day of the thirty (30) consecutive trading days ending on and including the last trading day prior to such measurement date, and (ii) the term “Company 10-Day Average Stock Price” shall mean, as of any measurement date, the price determined by calculating the average of the daily volume weighted average prices of a share of the Company's common stock on the NASDAQ Global Select Market as determined on each day of the ten (10) consecutive trading days ending on and including the last trading day prior to such measurement date. On the fourth anniversary of the Start Date, any portion of the Additional PSUs that have not theretofore vested will be automatically forfeited. If a Change in Control (as defined in the 2013 Plan) occurs prior to the fourth anniversary of the Start Date and before all the Additional PSUs are vested, the per share amount payable in the Change in Control will determine the applicable average stock price for any unearned milestone as of the Change in Control and any unvested portion of the Additional PSUs as of the Change in Control will automatically forfeit. Notwithstanding anything to the contrary contained in the Severance Policy (as defined below), in the event your employment terminates as a result of an Involuntary Termination (as defined in the Severance Policy), any portion of the Additional PSUs that have not theretofore vested will be automatically forfeited as of immediately prior to such event and will not accelerate or vest pursuant to the Severance Policy.

5.    Severance & Change of Control Benefits. Upon your employment with the Company, you will be designated as an officer as such term is used the meaning of Section 16 of the Securities Exchange Act of 1934, as amended (a “Section 16 Officer”). As a Section 16 Officer, you are eligible for benefits in the Company’s Change of Control Severance Policy for Officers and your participation agreement thereunder (the “Severance Policy”). The Severance Policy and participation agreement is attached to this letter as Exhibit A.

6.    Insider Trading. The Company’s insider trading policy applies to all of our employees, directors and consultants and our affiliates. The insider trading policy prohibits you from buying or selling shares when you have “inside information.” Inside information is material information about us that is not yet public but that a reasonable investor would consider important in deciding whether to buy or sell shares. You will be eligible to participate in any plan that is established to permit employees to automatically buy or sell shares during periods when they possess inside information.

7.     Tax Matters.

(a)    Withholding. All forms of compensation referred to in this Agreement are subject to reduction to reflect applicable withholding and payroll taxes and other deductions required by law.

(b)    Section 409A. The Company intends that all payments and benefits provided under this offer letter or otherwise are exempt from, or comply with, the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and any guidance promulgated thereunder (“Section 409A”) so that none of the payments or benefits will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply or be exempt. In no event will the Company reimburse you for any taxes that may be imposed on you as a result of Section 409A. Each payment and benefit payable hereunder is intended to constitute a separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.

(c)    Tax Advice. You are encouraged to obtain your own tax advice regarding your compensation from the Company. You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company, the Board or the Compensation Committee related to tax liabilities arising from your compensation.

8.    Eligibility. On your first day of work you will be required to prove your eligibility for employment under the Immigration and Reform Control Act of 1986, as well as to sign and comply with the Company’s standard invention assignment and proprietary information agreement which requires, among other provisions, the assignment of patent rights to any invention made during your employment at the Company and non-disclosure of proprietary information. I have attached a copy of this agreement for your review.

9.    At Will Employment. It is our desire that our association be long-lasting and mutually rewarding. You should, however, understand that all employees are employed “at will”, which means that each employee, as well as the Company, has the right to terminate the employment relationship at any time for any reason, with or without cause and your duties and responsibilities are subject to change at any time.

10.    No External Consulting. By signing this letter, you agree that as long as you are employed at the Company, you will not consult for other companies or organizations, even if they are deemed as non-competitive to the Company. Any external consulting agreement you undertake must be approved in writing by the Company’s Chief Executive Officer.

11.    No Conflict.    By signing this letter, you confirm that you have not entered into any agreement either written or oral in conflict with this Agreement or employment with Company and that you will not violate any agreement with or rights of any third party, or use or disclose any third party’s confidential information or intellectual property, when acting within the scope of your employment or otherwise on behalf of the Company

12.    Entire Agreement. This letter and the documents referred to herein constitute the entire agreement and understanding between you and the Company with respect to the subject matter described in this letter, and supersede and replace any prior understandings or agreements, whether oral or written, between you and the Company regarding such subject matter.

13.    Expiration and Contingency of Offer. This offer shall expire on April 2, 2021 and is contingent on your signing the Company’s standard invention assignment and proprietary information agreement, eligibility for employment under the Immigration and Reform Control Act of 1986, and your successful completion of a background check. If you are not eligible for employment or do not pass the background check, this offer of employment will be rescinded. The Company reserves the right to obtain relevant background reports at any time after receipt of your authorization and, if you are hired or engaged by the Company, any time throughout your employment or contract period.

Please indicate your acceptance to the foregoing terms by signing this letter where indicated below and returning it to me. We are delighted that you will be joining our team. We believe you will make an outstanding contribution to the Company and we are looking forward to working with you. If you have any questions, please do not hesitate to contact me.

This Participation Agreement (“Agreement”) is made and entered into by and between John Watters on the one hand, and FireEye, Inc. (the “Company”) on the other.

The Company adopted a Change of Control Severance Policy for Officers (the “Policy”) to assure that the Company will have the continued dedication and objectivity of the participants in the Policy, notwithstanding the possibility, threat or occurrence of a Change of Control.

The Company has designated you as eligible for protection under the Policy and this Agreement, subject to your qualifying as an Eligible Employee under the Policy on the date of a Qualified Termination.

Unless otherwise defined herein, the terms defined in the Policy, which is hereby incorporated by reference, shall have the same defined meanings in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

You have been designated as an Eligible Employee in the Policy, a copy of which is attached hereto, subject to your satisfying the criteria of being an Eligible Employee on the date of a Qualified Termination. Your participation in the Policy is contingent upon your agreeing to the terms of this Policy.

The terms and conditions of your participation in the Policy are as set forth in the Policy.

You agree that the Policy and the provisions in the Offer Letter constitutes the entire agreement of the parties hereto and supersedes in their entirety all prior representations, understandings, undertakings or agreements (whether oral or written and whether expressed or implied) of the parties, and shall specifically supersede any severance payment and/or change of control provisions of any agreement (other than the provisions in the Offer Letter) entered into between the you and Company.

This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.