Exhibit 10.12
March 16, 2006
Mr. Thomas McNeill
32 Seneca Drive
Commack, NY 11725
Dear Tom,
Please accept this correspondence as confirmation of an offer of employment from
Colorado Prime Corporation. Listed below are the particulars:
Position: VP, CFO
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Start Date: April 17, 2006
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Salary: $200,000
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Upon satisfactory completion of a public transaction and adequate financing of
the Company's strategic plan, base salary will be increased upon closing to
$215,000.
Salary can go up but not down, otherwise this will be deemed a termination of
employment contract and cause such provisions to go in effect.
Bonus: Eligible for participation in Corporate Incentive Plan tied to
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overall profit attainment ranges. Bonus potential range +/- from 10% to 50% of
base salary when +/- percentage of 100% of EBITDA is attained. (Exact schedule
to be developed.)
Stock Options: Eligible for option grants at the time the company becomes
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public and at other such times as deemed appropriate by the CEO, commensurate
with a CFO position.
Equity: Regarding equity granted and vested; a) 100% vesting of grants upon
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change of control, b) any vested options or warrants held by the employee may be
exercised for the duration of the original exercise period even in the event of
employee resignation or termination.
Example: 3 shares - 3 year vest term - month 25 employee tenders
resignation, accordingly 2 shares vest
Health Benefits: Eligible for participation in health benefit plans (medical
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and dental) to coincide with date of hire (may be required to provide evidence
of insurability and no break in prior coverage). Under the company's medical
plan, there is no exception for the 90-day enrollment period (3 full months of
employment, then enrollment on the 1st day of the following month), regardless
of employment status. Therefore, the company would pay your COBRA for that
period.
401(k) Benefits: Participation in the plan requires six months of continuous
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employment, after which participation is coincident with the beginning of the
next quarter. Discretionary company match equal to 40% of the employee deferral
contribution up to 1% of the employee's annual compensation. Under the Colorado
Prime Corporation 401(k) Plan, there are no exceptions for the six month
enrollment period, regardless of employment status. Information on Health and
401(k) Plan delivered under separate cover.
Life Insurance: 1 times annual compensation up to $150,000 (health plan
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participants)
Mr. Thomas McNeill
March 16, 2006
Page 2
Time Accrual:
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Vacation: 4 weeks per year
Personal/Sick: 5 days per year
Holidays: 7 days
Miscellaneous: Cell phone, newspaper, conferences as needed and based on
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business disciplines (common sense would prevail).
Change of Control/Severance:
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It is understood that your employment is voluntary in nature and is
employment-at-will.
In the event of termination of employment without cause, the employee shall
receive severance paid in one lump sum at the rate of one times the current
annual salary if the company is in a cash position (at the sole discretion of
the CEO) to honor this request. Company benefits in effect would continue for
12 months.
If the company is not in a cash position (at the sole discretion of the CEO),
severance will be paid at one times the current annual salary over a period of 6
months. Company benefits in effect would continue for 12 months.
In the event of a change of control, severance would be paid in one lump sum at
one and a half times the annual salary if the company is in a cash position (at
the sole discretion of the CEO). Company benefits in effect would continue for
12 months.
In the event of a change of control and the company is not in a cash position
(at the sole discretion of the CEO), severance would be paid at one and a half
times the annual salary paid over a period of 6 months. Company benefits in
effect would continue for 12 months.
Post change of control, employee has 30 days to exercise a "leave" provision.
If employee decides to leave and gives notice within this 30-day timeframe,
change of control provisions apply.
If employee resigns, or is terminated for good cause (including but not limited
to; willful misconduct or gross negligence in the performance or intentional
nonperformance of any employee's material duties and responsibilities, willful
dishonesty, fraud, alcohol or illegal drug abuse, or misconduct with respect to
the business affairs of the Company, conviction of a felony or other crime
involving moral turpitude) no severance would be paid.
LT Disability: The Company currently has no long-term disability coverage,
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but based on growth and profitability, we may consider this benefit.
We look forward to you joining the team, are excited about working with you and
welcome you.
Warmest regards,
/s/Paul A. Roman
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Paul A. Roman
Chairman, CEO
I acknowledge and accept the Colorado Prime Corporation offer of
employment.
/s/Thomas McNeill March 16, 2006
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Thomas McNeill Date