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EXHIBIT 10.12
[TOMAX LOGO]
August 27, 1999
PERSONAL DELIVERY - official copy
Steve Shubella
305 Queen Street
Alexandria, VA
Dear Steve:
This letter is your formal offer to join our team in the capacity of Senior Vice
President. Your preliminary assignment will be to build and manage our
Consulting, SI, and Custom Service Group. Your position is effective October 18,
1999.
SENIOR VICE PRESIDENT
As a Senior Vice President, you will be one of the top ranked executives in the
company, and will be relied upon to contribute commensurately. Our view is that
your experience and ability are of exceptional relevance to our mission to build
Tomax into the premiere 'click & mortar' solution provider in the retail and
commerce market.
Every aspect of your performance will have profound consequences on our success.
As a leader, you will exemplify a work ethic, standards of performance, and
fidelity towards the goals of the company and your assignment that will drive
your success and that of your team and executive peers.
You will be called upon to perform a number of assignments as required to
achieve on the Tomax mission. You will be personally involved in the business
process and will quickly 'own' a substantial piece of that process according to
your ability and achievement.
You will be substantially involved in the strategic development of the company,
via membership on the executive team, and further, you will be directly charged
with responsibilities that will drive our business to a leadership position in
the industry.
That's the high level, Breaking things down a little more, here's what we see in
terms of your initial assignment:
VICE PRESIDENT OF CONSULTING, SI, AND CUSTOM SERVICES
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You will be responsible for revenue development relative to the entire
RETAIL.net architecture and offering, with specific emphasis on the retail and
eCommerce industry.
This position will involve management, strategic, and tactical planning, with
specific emphasis on the development and execution of a comprehensive business
development and revenue attainment plan encompassing resource requirements,
training, measurement, and compensation. These plans and objectives will be
established in collaboration with the management team and the overall
objectives and requirements of the company.
REPORTING RELATIONSHIPS
You will report to myself as President and CEO of the company on the basis of
reporting requirements to be determined. As a senior member of the team, you
will work closely with the executive and management group, most notably Virgil
Fernandez, Senior Vice President of Software Development, relative to software
development initiatives, Jaye Olafson, Steve Klingler, and Jack Harbaugh
relative to customer relationship management (sales and marketing), Mark Kramer
in professional services, and many others.
CULTURE
Tomax seeks to build this new business group in a manner complimentary to the
existing culture. At the same time, the company expects to benefit from a
greater emphasis on customer requirements and satisfaction that is expected to
evolve from an increased focus on new business development focus.
MISSION
HELP MAKE US #1 IN THE INDUSTRY
To help us establish Tomax as the premiere provider of enterprise
management solutions in the supply chain arena. This is a process of
building the client partnerships on which the vision of our
applications architecture can 'bear fruit', establishing itself and
Tomax as leader in the retail and commerce markets.
MAKE QUARTERLY REVENUE TARGETS
To help Tomax achieve on quarterly (and therefore overall) revenue
and profitability targets, in particular by helping to insinuate our
'click & mortar' strategy within the industry as the preeminent basis
on which to fuse physical and virtual retail models. More
specifically, you will add value to the customer and prospect via the
services and contribution of yourself and your group.
BUILD A WORLD CLASS CONSULTING GROUP
You will create a consulting services group that will encompass
consulting, systems integration, and custom software development
services. The primary focus initially will be on the enhancement of
our current methods and our business development model (pricing,
licensing, approach, etc.) We view the consulting group as an
essential component and partner to the sales process (our
relationship management group).
Note: we have a very strong asset in Mark and it is not clear that
the initial focus needs to include the custom group, especially if we
are leaning towards the new business market.
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CREATE A VALUE BASED BUSINESS MODEL
You will assist in the company effort to revise the fundamental
business model towards a value based approach. Tomax wants to be a
leader and an innovator in implementing more contemporary relationship
models with its client community.
BUILD HOSTING (APPLICATION SERVICE PROVIDER) BUSINESS
To lead the initiative by which Tomax will become a leader in the
emerging market for hosting and application service providers. Our
vision is that a continuum exists along which a range of services and
offerings to allow retailer to selectively deploy outsourcing and
hosting services as required to meet current needs.
To contribute to the development of our image in the marketplace
consistent with our positioning through appropriate sales and
marketing initiatives as agreed upon in our sales plan.
ORGANIZATION RESPONSIBILITY:
Meet the revenue targets established.
Provide leadership and integrity in the pursuit of these targets.
Create and maintain a team environment that is productive, efficient,
and focused on client requirements.
Develop and implement an integrated team plan compatible with our
product/market organizational matrix developed as part of the business
plan. Each team member should have purpose, reward, and support
towards the attainment of individual and team objectives that you will
establish.
Develop and implement a comprehensive 'method' that encapsulates and
codifies our current 'methods' and create the new ones required. This
initiative will take advantage of our current Notes based tracking and
management tools and will integrate with our financial management
controls.
Develop and maintain consistent, accurate, and timely reporting on the
status of the team including financial performance, attainment, and
customer satisfaction.
COMPENSATION PACKAGE
Following in an overview of your compensation package:
SALARY - $180,000 per annum, paid bimonthly.
STOCK OPTIONS - At or before this time you will be provided with stock
options per a separate and mutual agreement that provides stock in the
company in an amount equal to 2% of the current issued shares of the
company at strike price of par less 10-15% (or the price equal to the
lowest price made available to any other member of the team under
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any plan) to be determined and over a five year, monthly vesting
(or a shorter period as may be determined).
EXPENSES -- you will be paid for all approved expenses incurred in
the performance of your position, provided you comply with expense
reporting procedures.
90 DAY REVIEW -- at the conclusion of 90 days, we will sit down and
mutually determine our go-forward position. If either party is
uncomfortable with the decision to join, we can part company
amicably.
SEVERANCE -- we will provide three months compensation on
termination on Tomax' part, regardless of cause.
RELOCATION -- we will look after basic relocation expenses to
include two trips for you and your family to Salt Lake City to look
for new accommodation and the costs of the move based on direct
costs including the moving company and other agreed to expenses.
EQUIPMENT AND TOOLS -- Tomax will provide you with appropriate
tools to execute the responsibilities of your position. This will
include laptop, PDA, phone, and other tools are determined
necessary by you and the Vice President of Operations. Similar
arrangements will be made for members of your team.
In addition you will receive the following benefits:
- Company sponsored health and dental insurance. The company pays 50% of
the monthly premium with the employee paying the remaining 50%. Health
insurance is effective on the first on the month following your first
30 days of employment.
- Company paid term life insurance equal to one times your gross yearly
wages up to $50,000.
- 401K plan where the company contributes $0.50 on the dollar up to the
first 6% of your contribution with a five-year, 20% vesting schedule.
Requires six months of full-time employment to meet the eligibility
requirements.
- Company sponsored short- and long-term disability insurance. Premiums
are paid by the employee.
- 24 days of paid time off (PTO).
We are looking forward to you joining our team. With your help, we are going to
build the most successful retail and eCommerce company in the world! Please
indicate your acceptance by signing both copies and returning one copy to our
office.
Yours sincerely,
TOMAX TECHNOLOGIES, INC.
Eric Olafson
President & CEO
