June 14, 2000
Mr. Xxxxx Xxxxxx
000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Dear Xxxxx:
The Board of Directors of InfoNow Corporation (hereafter referred to as "the
Company") is pleased to offer you the position of President, InfoNow
Corporation. The position is one that offers great challenge and an opportunity
for accelerated professional growth in a dynamic environment.
This letter embodies the terms of our offer of employment to you:
TERM
The term of this agreement shall be 36 months, beginning on the first date of
employment.
BASE SALARY
You will be paid a semi-monthly gross salary in the amount of $7,916.67, paid on
the 15th and last day of each month.
PERFORMANCE BONUS
You will be included in the Company's executive compensation program which will
pay you a bonus based on defined annual revenue, earnings and operational
targets ("Targets"). These Targets will be established by the CEO and Board of
Directors during the first three months of your employment, and then for each
InfoNow fiscal year thereafter. You have the potential to receive additional
annual compensation as follows:
Percentage Achievement of "Targets" Bonus Award
(Based on 12 month fiscal year)
100% Achievement $ 55,000
131.25% Achievement $ 68,750
162.5% Achievement $110,000
The CEO and Board of Directors may assign additional bonuses for achievement
beyond 162.5% of annual "Targets".
EQUITY
The Board of Directors has approved the grant of a non-incentive stock option to
purchase 200,000 shares of InfoNow common stock upon acceptance of this
Agreement. Seven (7) months after the grant of your options, 7/36ths of the
stock option will be vested and you will continue vesting at the rate of 1/36th
per month of employment thereafter. Vested options have a five-year exercise
period from the date of grant and will be priced at the fair market value (FMV)
of the Company's common stock on the grant date. The Company defines fair market
value as the mean of the bid and ask price at the close of business on the day
the option is granted by the Board of Directors.
In the event of a merger of the Company where it is not the surviving entity;
the sale of substantially all of the Company's assets; or the termination of
your employment immediately following a change of control of the Company, all
options granted under this agreement shall vest according to the schedule below:
o During your first 12 months of employment: 1/36 of your stock option shall
vest for each completed month of employment at the date of the change in
control. In addition, 50% of the remaining unvested shares underlying
options will also vest.
o After your first 12 months of employment: 100% of unvested options will
vest upon a change of control as defined above.
BENEFITS
The standard InfoNow benefits package will be extended to you as outlined in the
Employee Handbook.
As per the company's current guidelines, you will be reimbursed up to $75 per
month for parking. Every effort will be made to expedite a parking space in the
building garage.
VACATION
You will receive four weeks of paid vacation per year, in addition to normal
InfoNow holidays as outlined in the Employee Handbook.
OTHER
Upon appropriate documentation, you may be reimbursed up to a maximum of $30,000
for bonuses that were earned but not received due to your departure date from
Mincom.
You will be provided with a notebook personal computer.
2
SEVARANCE
In the event that the Company terminates you without cause, you will receive
severance payments for a period of nine months following the date of your
termination at a rate equal to 75% of your then in force base salary rate.
Unless otherwise provided in the "Equity" section regarding " . . . change of
control", the Company will immediately vest 25% of all unvested options granted
to you.
TERMINATION
The Company may terminate your employment for cause. The term "cause" in this
agreement means your conviction of a felony or acts of fraud or flagrant
dishonesty.
For the Board of Directors,
Xxxxxxx X. Xxxxxxx, Chairman and CEO
I have read and accept the terms and conditions of employment contained herein.
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Xxxxx Xxxxxx Date
