Sample Business Contracts


Employment Agreement - Avenue A Inc. and Brian McAndrews

Employment Forms

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                              Employment Agreement


                                    between

                                 Avenue A, Inc.

                                      and

                                Brian McAndrews



                                                    Dated as of January 20, 2000
<PAGE>

                             Employment Agreement

     This Employment Agreement (this "Agreement"), is entered into as of January
20, 2000 , between Avenue A, Inc., a Washington corporation ("Avenue A"), and
Brian McAndrews ("Executive").

                              W I T N E S S E T H:
                              - - - - - - - - - -

     WHEREAS, Executive has been serving as Chief Executive Officer of Avenue A
pursuant to a letter agreement respecting Executive's employment and
compensation dated as of August 30, 1999. Avenue A and Executive desire to enter
into a formal employment agreement relating to Executive's employment by Avenue
A, including various changes or additions to the terms of the original letter
agreement; and

     WHEREAS, Executive is willing to provide services to Avenue A upon the
terms and conditions set forth herein;

                              A G R E E M E N T S:
                              - - - - - - - - - -

     NOW, THEREFORE, for and in consideration of the foregoing premises and for
other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, Avenue A and Executive hereby agree as follows:

1.   EMPLOYMENT

     Avenue A will employ Executive and Executive will serve as the Chief
Executive Officer of Avenue A.  During Executive's employment, Executive shall
serve Avenue A faithfully and to the best of his ability, devoting substantially
all his working time, attention and energies to the business of Avenue A.
Executive's status, duties and responsibilities shall be reasonably commensurate
with his title, and he shall perform such duties as lawfully assigned to
Executive.  Executive shall not engage in any other business activity (except
the management of personal investments and participation in civic or charitable
activities which in the aggregate do not interfere with the performance of
Executive's duties hereunder) without first obtaining the written consent of
Avenue A, such consent not to be unreasonably withheld.

2.   COMPENSATION AND STOCK OPTIONS

     During his employment, Avenue A will pay Executive an annual salary of not
less than $300,000 paid semi-monthly.  In addition, Executive has been granted a
stock option to purchase 1,230,000 shares of the common stock of Avenue A at an
<PAGE>

exercise price of $1.90 per share, which option is subject to four-year vesting
and other conditions in accordance with the terms of the option letter agreement
evidencing such option and the terms of the Avenue A, Inc. 1998 Stock Incentive
Compensation Plan.  A portion of the option, for 210,526 shares, was structured
as an incentive stock option within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, and the remainder was structured as a
nonqualified stock option.  Upon the completion of the Company's initial public
offering of common stock (IPO), Executive will be granted a non-qualified stock
option for the purchase of an additional 176,000 shares of common stock (as
adjusted for stock splits, stock dividends and the like, occurring after
September 15, 1999 and prior to the consummation of the IPO) at an exercise
price equal to the IPO offering price (which shall not be adjusted for stock
splits, stock dividends and the like prior to the IPO), vesting over a four-year
period in accordance with the terms of the Plan, with credit for vesting given
for the period between Executive's employment commencement date and the date of
completion of the IPO.

3.   BENEFITS AND RELOCATION COSTS

     During the term of his employment, Executive will be entitled to
participate in Avenue A's benefits made available to employees generally from
time to time, including, without limitation, health care benefits, 401k Savings
Plan, as well as other benefits, if any, as may be offered to Avenue A's senior
management employees.  Avenue A will pay reasonable expenses associated with
relocating Executive to Seattle.

4.   TERMINATION

     Employment of Executive pursuant to this Agreement may be terminated as
follows:

     4.1  By Avenue A

     With or without Cause (as defined below), Avenue A may terminate the
employment of Executive at any time upon giving Notice of Termination (as
defined below).

     4.2  By Executive

     Executive may terminate his employment at any time, for any reason, upon
giving Notice of Termination.

                                      -2-
<PAGE>

     4.3  Automatic Termination

     This Agreement and Executive's employment hereunder shall terminate
automatically upon the death or total disability of Executive.  The term "total
disability" as used herein shall mean Executive's inability to perform the
duties set forth in paragraph 1 hereof for a period or periods aggregating
ninety (90) calendar days in any 12-month period as a result of physical or
mental illness, loss of legal capacity or any other cause beyond Executive's
control, unless Executive is granted a leave of absence by the Board of
Directors of Avenue A.  Executive and Avenue A hereby acknowledge that
Executive's ability to perform the duties specified in paragraph 1 hereof is of
the essence of this Agreement.  Termination hereunder shall be deemed to be
effective (a) at the end of the calendar month in which Executive's death occurs
or (b) provided that an independent physician appointed by Avenue A and
reasonably acceptable to Executive or his personal representative (the
"Independent Physician") has determined in a written report made available to
Executive or his personal representative that Executive is unable to perform the
duties set forth in paragraph 1 hereof as a result of physical or mental
illness, loss of legal capacity or any other cause beyond Executive's control,
and such disability has been in effect for a period or periods aggregating
ninety (90) calendar days in a 12-month period, immediately upon notice to
Executive or his personal representative.  Notwithstanding the foregoing, "total
disability" shall not include any temporary illness or condition that prevents
Executive from performing his duties for a period of no more than 180 days if,
in the opinion of the Independent Physician, Executive is reasonably likely to
recover within 180 days or less from the onset of the illness or condition, such
that he can permanently resume performance of his duties.

     4.4  Notice

     The term "Notice of Termination" shall mean at least thirty (30) days'
written notice of termination, by either party, of Executive's employment,
during which period Executive's employment and performance of services will
continue; provided, however, that Avenue A may, upon notice to Executive and
without reducing Executive's compensation during such period, excuse Executive
from any or all of his duties during such period, and Executive shall be
entitled to all compensation and benefits during such period.  Such a reduction
in duties shall not constitute "good reason" for voluntary termination so as to
trigger termination payments in accordance with subparagraph 5.2.  The effective
date of the termination (the "Termination Date") of Executive's employment
hereunder shall be the date on which such 30-day period expires.

                                      -3-
<PAGE>

5.   TERMINATION PAYMENTS AND ACCELERATION OF VESTING

     In the event of termination of the employment of Executive, all
compensation and benefits set forth in this Agreement shall terminate except as
specifically provided in this paragraph 5:

     5.1  Termination by Avenue A

     (a)  Upon termination by Avenue A, Avenue A shall pay Executive any unpaid
annual base salary which has accrued or is payable through the Termination Date,
together with any unpaid bonus compensation that Executive has earned in
accordance with the conditions set by the Board of Directors with respect to
such compensation.

     (b)  If Avenue A terminates Executive's employment without Cause, as
defined below, Executive shall be entitled to receive termination payments equal
to twelve (12) months annual base salary.  The termination payments shall be
calculated according to Executive's base salary as of the date of Notice of
Termination and the termination payments will be paid semi-monthly in equal
parts in accordance with the same time schedule that Avenue A or a Successor
Company (as defined in Exhibit A hereto and incorporated by reference herein)
makes its customary payroll.  Avenue A or a Successor Company may deduct
customary withholdings including social security, federal and state income
taxes, and state disability insurance from these severance payments; however,
any and all such obligations shall be Executive's responsibility.  Avenue A will
issue and file appropriate Form 1099 or similar tax documents in connection with
any termination payments.  The termination payments described in this paragraph
are expressly contingent upon Executive's signing upon termination a release in
the form attached hereto as Exhibit B, and are further contingent upon
Executive's full compliance with the terms of his Confidentiality, Inventions
Assignment, Noncompetition and Nonsolicitation Agreement with Avenue A (the
"Confidentiality Agreement"), a copy of which is attached hereto as Exhibit C.
In the event that it is determined by a court of competent jurisdiction that
Executive has engaged in any act or activity that represents a material breach
of this Confidentiality Agreement, Executive shall return to Avenue A (and any
Successor Company) the amount of severance payments made by Avenue A (and any
Successor Company) after the date of such breach.  Immediately upon learning of
such a breach, Avenue A may immediately cease any further payments otherwise due
under this Paragraph.  In the event that a court of competent jurisdiction
determines that any breach alleged by Avenue A was not in fact or as a matter of
law a breach, Avenue A shall pay to Executive any severance amount so withheld
and reimburse Executive for his reasonable attorneys' fees and court costs
incurred in proving such non-breach.

                                      -4-
<PAGE>

     (c)  If Avenue A terminates Executive's employment without Cause, as
defined below, then (1) a portion, as is determined in accordance with the
following sentence, of any Avenue A stock option held by Executive immediately
prior to the Termination Date that is unvested shall automatically vest
immediately prior to the Termination Date (and in such case the shares
subsequently issued on exercise of such accelerated portion shall be vested),
and (2) a portion, as is determined in accordance with the following sentence,
of unvested shares, if any, issued to Executive on exercise of any Avenue A
stock options shall, immediately prior to the Termination Date, automatically
vest and be no longer subject to the right of repurchase in favor of  Avenue A.
The portion of any unvested stock options or unvested shares that shall vest in
accordance with the foregoing sentence shall be an amount equal to the portion
that would have vested during the one year period immediately following the
Termination Date (assuming, for purpose of determining the amount, that no
termination had occurred and Executive had continued Executive's employment with
Avenue A during that one year period).  If the one year anniversary of the
Termination Date falls in the middle of a quarter for option or share vesting
purposes, the vesting acceleration described above shall be pro rated for the
actual number of days between the beginning of such quarter and the one year
anniversary date.  To the extent of any inconsistency between (i) the terms
contained in this Agreement regarding acceleration of vesting of stock options
or of unvested shares granted to or held by Executive and (ii) general terms
regarding acceleration of vesting of stock options or of unvested shares
contained in any stock option plan of Avenue A under which any stock option held
by Executive is granted (a "Company Stock Option Plan") or any option letter
agreement for any stock option for Avenue A common stock granted to Executive
prior to or after the date of this Agreement (an "Option Agreement"), such
inconsistency shall be resolved in favor of Executive.

     (d)  If Executive is terminated for Cause by Avenue A or a Successor
Company, Executive shall not be entitled to any termination payments or
accelerated vesting benefit, except that Executive's salary shall be continued
for three months after his Termination Date.

     5.2  Termination by Executive

     (a)  In the case of the termination of Executive's employment with Avenue A
by Executive for "good reason," as defined below, Executive shall be entitled to
the termination payments and accelerated vesting benefit as set forth in clauses
5.1(a), (b) and (c), above.  In the case of termination of Executive's
employment with Avenue A by Executive for any other reason, Executive shall not
be entitled to any termination payments or accelerated vesting benefit, except
that Executive's salary shall be continued for three months after Termination
Date.

                                      -5-
<PAGE>

     (b)  In the case of the termination of Executive's employment with a
Successor Company by Executive for "good reason," as defined below, Executive
shall be entitled to the termination payments as set forth in clauses 5.1(a) and
(b), above.  In addition, in such event 100% of Executive's unvested stock
options and 100% of Executive's unvested shares issued or issuable upon exercise
of Executive's stock options shall immediately vest upon Notice of Termination.
In the case of termination of Executive's employment with a Successor Company by
Executive for any other reason, Executive shall not be entitled to any
termination payments or accelerated vesting benefit, except that Executive's
salary shall be continued for three months after Termination Date.

     5.3  Termination by Successor Company

     In the case of the termination without Cause, as defined below, of
Executive's employment by a Successor Company within one year after a Change of
Control, as defined in Exhibit A, Executive shall be entitled to the termination
payments as set forth in clauses 5.1(a) and (b), above.  In addition, in such
event 100% of Executive's unvested stock options and 100% of Executive's
unvested shares issued or issuable upon exercise of Executive's stock options
shares shall immediately vest upon Notice of Termination.

     5.4  Termination as a Result of Death or Total Disability

     In the event of termination of Executive's employment pursuant to
subparagraph 4.3, Executive or his estate shall be paid the compensation set
forth in clause 5.1(a) and shall not be entitled to any of the benefits under
clauses 5.1(b) or 5.1(c), above.

     5.5  "Good Reason"

     "Good reason" shall mean the occurrence of any of the following events,
without the consent of the Executive, after a "Change of Control" (as defined in
Exhibit A hereto and incorporated by reference herein:

          a)   a demotion or other material reduction in Executive's status or
               the nature of Executive's responsibilities; provided, however,
               that a change in the person or office to which Executive reports,
               without a corresponding reduction in duties, status and
               responsibilities, shall not constitute "good reason;"

          b)   a non-voluntary reduction in the Executive's annual base salary;

                                      -6-
<PAGE>

          c)   requirement by a Successor Company that the Executive relocate
               his principal place of employment to a location that is more than
               50 miles from the principal place of employment where Executive
               was employed immediately prior to the "Change of Control;" or

          d)   the failure of Avenue A to obtain a satisfactory agreement from
               any Successor Company to assume and perform the obligations under
               this Agreement.

     5.6  Cause

     Wherever reference is made in this Agreement to termination being with or
without Cause, "Cause" shall include, without limitation, the occurrence of one
or more of the following events:

          (a)  willful misconduct, insubordination, or dishonesty in the
     performance of Executive's duties or other knowing and material violation
     of Avenue A's or a Successor Company's policies and procedures in effect
     from time to time which results in a material adverse effect on Avenue A or
     a Successor Company;

          (b)  willful actions (or intentional failures to act) in bad faith
     with respect to Avenue A or a Successor Company that materially impair
     Avenue A's or a Successor Company's business, goodwill or reputation;

          (c)  conviction of a felony involving an act of dishonesty, moral
     turpitude, deceit or fraud, or the commission of acts that could reasonably
     be expected to result in such a conviction;

          (d)  current use by the Executive of illegal substances; or

          (e)  any material willful violation of your Confidentiality Agreement
     with Avenue A.

     5.7  Acceleration in the Event of a Change in Control

     In the event Executive is employed by Avenue A immediately prior to the
date  of a "Change in Control" (as defined in Exhibit A hereto and incorporated
by reference herein), then immediately prior to the Change in Control 50% of
Executive's then unvested stock options and 50% of Executive's then unvested
shares issued  upon exercise of Executive's stock options shall immediately vest
(and in such case the shares subsequently issued on exercise of such accelerated
portion of Executive's option shall be vested); provided further that such
vesting options and shares shall be

                                      -7-
<PAGE>

allotted proportionately from Executive's vesting schedule, i.e., 50% of the
options and shares scheduled to vest on each vesting date shall accelerate. To
the extent of any inconsistency between (i) the terms contained in this
Agreement regarding acceleration of vesting of stock options or of unvested
shares granted to or held by Executive and (ii) general terms regarding
acceleration of vesting of stock options or of unvested shares contained in any
Company Stock Option Plan or any Option Agreement, such inconsistency shall be
resolved in favor of Executive.

6.   CONFIDENTIALITY, NONCOMPETITION AND NONSOLICITATION AGREEMENT

     Executive is subject to the terms of the Confidentiality Agreement entered
into concurrently with this Agreement and the terms of the Confidentiality
Agreement shall survive the termination of Executive's employment with Avenue A.

7.   REPRESENTATIONS AND WARRANTIES; NO VIOLATION

     In order to induce Avenue A to enter into this Agreement, Executive
represents and warrants to Avenue A that neither the execution nor the
performance of this Agreement by Executive will violate or conflict in any way
with any other agreement by which Executive may be bound, or with any other
duties imposed upon Executive by corporate or other statutory or common law.

8.   NOTICE AND CURE OF BREACH

     Whenever a breach of this Agreement by either party is relied upon as
justification for any action taken by the other party pursuant to any provision
of this Agreement, other than pursuant to the definition of "Cause" set forth in
subparagraph 5.4 hereof, before such action is taken, the party asserting the
breach of this Agreement shall give the other party at least 14 days' prior
written notice of the existence and the nature of such breach before taking
further action hereunder and shall give the party purportedly in breach of this
Agreement the opportunity to correct such breach during the 14-day period.

9.   FORM OF NOTICE

     All notices given hereunder shall be given in writing, shall specifically
refer to this Agreement and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, at the address set forth below or at such other
address as may hereafter be designated by notice given in compliance with the
terms hereof:

                                      -8-
<PAGE>

     If to Executive:     Brian McAndrews

                          -----------------------------------------------------
                          -----------------------------------------------------
                          -----------------------------------------------------

     If to Avenue A:      Avenue A, Inc.
                          506 Second Avenue
                          Seattle, WA  98104
                          Facsimile: (206) 521-8808
                          Attention:  Chairman

     Copy to:             Perkins Coie LLP
                          1201 Third Avenue, 48th Floor
                          Seattle, WA  98101-3099
                          Facsimile: (206) 583-8500
                          Attention:  James Sanders

If notice is mailed, such notice shall be effective upon mailing, or if notice
is personally delivered or sent by telecopy or other electronic facsimile
transmission, it shall be effective upon receipt.

10.  ASSIGNMENT

     This Agreement is personal to Executive and shall not be assignable by
Executive.  Avenue A may assign its rights hereunder to (a) any corporation
resulting from any merger, consolidation or other reorganization to which Avenue
A is a party or (b) any corporation, partnership, association or other person to
which Avenue A may transfer all or substantially all of the assets and business
of Avenue A existing at such time.  All of the terms and provisions of this
Agreement shall be binding upon and shall inure to the benefit of and be
enforceable by the parties hereto and their respective successors and permitted
assigns.

11.  WAIVERS

     No delay or failure by any party hereto in exercising, protecting or
enforcing any of its rights, titles, interests or remedies hereunder, and no
course of dealing or performance with respect thereto, shall constitute a waiver
thereof.  The express waiver by a party hereto of any right, title, interest or
remedy in a particular instance or circumstance shall not constitute a waiver
thereof in any other instance or circumstance.  All rights and remedies shall be
cumulative and not exclusive of any other rights or remedies.

                                      -9-
<PAGE>

12.  ARBITRATION

     Any controversies or claims arising out of or relating to this Agreement
shall be fully and finally settled by arbitration in the city of Seattle,
Washington in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect (the "AAA Rules"), conducted by one
arbitrator either mutually agreed upon by Avenue A and Executive or chosen in
accordance with the AAA Rules, except that the parties thereto shall have any
right to discovery as would be permitted by the Federal Rules of Civil Procedure
for a period of 90 days following the commencement of such arbitration and the
arbitrator thereof shall resolve any dispute which arises in connection with
such discovery.  The prevailing party shall be entitled to costs, expenses and
reasonable attorneys' fees, and judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.

13.  AMENDMENTS IN WRITING

     No amendment, modification, waiver, termination or discharge of any
provision of this Agreement, nor consent to any departure therefrom by either
party hereto, shall in any event be effective unless the same shall be in
writing, specifically identifying this Agreement and the provision intended to
be amended, modified, waived, terminated or discharged and signed by Avenue A
and Executive, and each such amendment, modification, waiver, termination or
discharge shall be effective only in the specific instance and for the specific
purpose for which given.  No provision of this Agreement shall be varied,
contradicted or explained by any oral agreement, course of dealing or
performance or any other matter not set forth in an agreement in writing and
signed by Avenue A and Executive.

14.  APPLICABLE LAW

     This Agreement shall in all respects, including all matters of
construction, validity and performance, be governed by, and construed and
enforced in accordance with, the laws of the state of Washington, without regard
to any rules governing conflicts of laws.

15.  SEVERABILITY

     If any provision of this Agreement shall be held invalid, illegal or
unenforceable in any jurisdiction, for any reason, including, without
limitation, the duration of such provision, its geographical scope or the extent
of the activities prohibited or required by it, then, to the full extent
permitted by law (a) all other provisions hereof shall remain in full force and
effect in such jurisdiction and shall be liberally construed in order to carry
out the intent of the parties hereto as nearly as may

                                      -10-
<PAGE>

be possible, (b) such invalidity, illegality or unenforceability shall not
affect the validity, legality or enforceability of any other provision hereof,
and (c) any court or arbitrator having jurisdiction thereover shall have the
power to reform such provision to the extent necessary for such provision to be
enforceable under applicable law.

16.  HEADINGS

     All headings used herein are for convenience only and shall not in any way
affect the construction of, or be taken into consideration in interpreting, this
Agreement.

17.  COUNTERPARTS

     This Agreement, and any amendment or modification entered into pursuant to
paragraph 13 hereof, may be executed in any number of counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute one and
the same instrument.

18.  CONFIDENTIALITY AGREEMENT

     Avenue A expressly acknowledges that (a) this Agreement supersedes Section
6.1 of the Confidentiality Agreement and, (b) notwithstanding anything to the
contrary in the Confidentiality Agreement, the term "Competing Business" shall
not be construed to include a business which offers and sells advertising on
media (including Web sites, radio and television stations and print media) owned
or controlled by such business or a business which markets the products or
services (other than advertising or marketing services to third parties) that
such business offers for sale to the public.

18.  ENTIRE AGREEMENT

     This Agreement on and as of the date hereof, together with the
Confidentiality Agreement, constitutes the entire agreement between Avenue A and
Executive with respect to the subject matter hereof and all prior or
contemporaneous oral or written communications, understandings or agreements
between Avenue A and Executive with respect to such subject matter are hereby
superseded and nullified in their entireties.

                                      -11-
<PAGE>

     IN WITNESS WHEREOF, the parties have executed and entered into this
Agreement on the date set forth above.

                           EXECUTIVE:

                           Brian McAndrews

                           /s/ Brian McAndrews
                           ----------------------------------------------------

                           AVENUE A:

                           Avenue A, Inc.

                           By     /s/ Jeffrey Miller
                             --------------------------------------------------
                             Its Vice President, Corporate Development and Legal
                                -----------------------------------------------
                                 Affairs
                                -----------------------------------------------

                                      -12-
<PAGE>

                                   EXHIBIT A

1.   Definition of "Change of Control"

     For purposes of the Employment Agreement, a "Change of Control" means any
of:

     (i)    an event in which any person (including any individual, entity or
group within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended, (the "Exchange Act")) (a  "Person"), shall
become the beneficial owner (within the meaning of Rule 13d-3 promulgated under
the Exchange Act), directly or indirectly, of fifty percent (50%) or more of the
combined voting power of the capital stock of Avenue A, Inc. ("Avenue A")  then
outstanding; or

     (ii)   at any time during which Avenue A has a class of equity securities
which is listed on a national securities exchange or an automated quotation
system (including, without limitation, the Nasdaq Stock Market) ("publicly
traded"), a Person acquires equity securities representing more than thirty
percent (30%) of the combined voting power of the capital stock of Avenue A
outstanding as of the date of such transaction (or the first of a series of
related transactions), but only if such equity securities were acquired in a
transaction or series of related transactions which were not approved by the
Board of Directors of Avenue A in office prior to the date of such first
acquisition (provided, however that if such Person is entitled, pursuant to Rule
13d-1 under the Exchange Act to file a Form 13G with respect to its holdings of
equity securities of Avenue A in lieu of a Form 13D, such event will not
constitute a Change of Control unless and until such Person files a Form 13D
with respect to such holdings); or

     (iii)  at any time during which Avenue A has a class of equity securities
which is publicly traded, a Person acquires equity securities representing more
than twenty percent (20%) of the combined voting power of the capital stock of
Avenue A outstanding prior to the date of such transaction (or the first of a
series of related transactions) in a transaction or series of related
transactions which were not approved by the Board of Directors of Avenue A in
office prior to the date of such first acquisition, and, within one year
thereafter, at least two individuals whose election to the Board of Directors
was proposed by such person are members of the Board of Directors; or

     (iv)   the sale or other disposition of all or substantially all of Avenue
A's assets, other than to a corporation with respect to which immediately
following such sale or disposition (A) securities representing more than sixty
percent (60%) of the combined voting power the capital stock of such corporation
are then beneficially owned, directly or  indirectly, by all or substantially
all of the beneficial owners of securities representing the combined voting
power of the capital stock of Avenue A (the "Company Voting Securities")
immediately prior to such sale or disposition in substantially the same
proportion as their ownership, immediately prior to such sale or other
disposition, of Company Voting Securities, (B) no Person (excluding Avenue A,
any employee benefit plan (or related trust) of Avenue A or such corporation and
any Person beneficially owning, immediately prior to such sale or other
disposition, directly or indirectly, securities representing 33% or  more of
Company Voting Securities) beneficially owns, directly or indirectly, securities
representing 33% or more of the combined voting power of the capital stock of
such corporation; and (C) at least a majority of the members of the board of
directors of the such corporation were approved by majority of directors of the
Incumbent Directors on Avenue A's Board of Directors at the time such
transaction was initially approved by Avenue A.  An "Incumbent Director" is a
director (a) nominated or appointed by a majority of Avenue A's current Board of
Directors or (b) nominated
<PAGE>

or appointed by directors nominated or appointed by a majority of Avenue A's
current Board of Directors; or

     (v)    the reorganization, merger or consolidation of Avenue A with any
other corporation or entity, in each case unless immediately following such
reorganization, merger or consolidation (A) securities representing more than
60% of the combined voting power of the capital stock of the corporation
resulting from such reorganization, merger or consolidation are then
beneficially owned, directly, or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners of Company Voting
Securities immediately prior such reorganization, merger or consolidation in
substantially the same proportion as their ownership immediately prior to such
reorganization, merger or consolidation, of Company Voting Securities, (B) no
Person (excluding Avenue A, any employee benefit plan (or related trust) of
Avenue A or such corporation resulting from such reorganization, merger or
consolidation and any Person beneficially owning, immediately prior to such
reorganization, merger or consolidation, directly or indirectly, securities
representing 33% or more of Company Voting Securities) beneficially owns,
directly or indirectly, securities representing 33% or more of the combined
voting power of the corporation resulting from such reorganization, merger or
consolidation, and (C) at least a majority of the members of the board of
directors of the corporation resulting from such reorganization, merger or
consolidation were the Incumbent Directors at the time that the agreement for
such reorganization, merger or consolidation was initially executed; or

     (vi)   the dissolution or liquidation of Avenue A; or

     (vii)  a change in the composition of the Board of Directors of Avenue A in
which the majority of the seats (other than vacant seats) on the Board have been
occupied by individuals who were neither (a) nominated or appointed by a
majority of the current Board of Directors nor (b) nominated or appointed by
directors nominated or appointed by a majority of the current Board of
Directors.

2.   Definition of "Successor Company"

     For purposes of the Employment Agreement, "Successor Company" shall mean
any of  (i) any corporation that acquires all or substantially all of the assets
of Avenue A in a "Change of Control" described in clause (iv) of the definition
of "Change of Control" above or (ii) a successor corporation to Avenue A (or
parent corporation thereof)  resulting from a "Change in Control" of Avenue A
described in clause (v) of the definition of "Change of Control" above.
<PAGE>

                                   EXHIBIT B

                               WAIVER AND RELEASE

     For and in consideration of the severance payments and benefits set out in
the Employment Agreement attached hereto, Executive, on behalf of himself and
his agents, heirs, successors and assigns, expressly waives any claims against
Employer and releases Employer (including its officers, directors, stockholders,
managers, agents and representatives) from any and all claims, demands,
liabilities, damages, obligations, actions or causes of action of any kind,
known or unknown, past or present, arising out of, relating to, or in connection
with Executive's employment, termination of employment, or the holding of any
office with Employer or any other related entity.  The claims released by
Executive include, but are not limited to, claims for defamation, libel,
invasion of privacy, intentional or negligent infliction of emotional distress,
wrongful termination, constructive discharge, breach of contract, breach of the
covenant of good faith and fair dealing, breach of fiduciary duty, fraud, or for
violation of any federal, state or other governmental statute or ordinance,
including, without limitation, Title VII of the Civil Rights Act of 1964, the
federal Age Discrimination in Employment Act, the Americans with Disabilities
Act, the Family and Medical Leave Act, the Employment Retirement Income Security
Program or any other legal limitation on the employment relationship.

     This waiver and release shall not waive or release claims where the events
in dispute first arise after execution of this Release.

     Executive agrees he has been provided the opportunity to consider for
twenty-one (21) days whether to enter into this Release, and has voluntarily
chosen to enter into it on this date.  Executive may revoke this Release for a
period of seven (7) days following the execution of this Release; this Release
shall become effective following expiration of this seven (7) day period.  This
Release shall be effective when signed.  Executive acknowledges that he is
voluntarily executing this Release, that he has carefully read and fully
understands all aspects of this Release and the attached Employment Agreement,
that he has not relied upon any representations or statements not set forth
herein or made by Avenue A's agents or representatives, that he has been advised
to consult with an attorney prior to executing the Release, and that, in fact,
he has consulted with an attorney of his choice as to the subject matter and
effect of this Release.

-----------------------                 ---------------------------------------
Date                                    Brian McAndrews
<PAGE>

                                   EXHIBIT C

                           CONFIDENTIALITY AGREEMENT

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