IOMEGA CORPORATION
0000 Xxxx 0000 xxxxx
Xxx, Xxxx 00000
March 25, 1998
Xx. Xxxxx X. Xxxxx
Xxxxxxxxx, Nevada 89011
Dear Xxx:
This letter will serve as the agreement between Iomega Corporation
("Iomega") and you regarding the following:
1. Effective March 24, 1998, you will serve as Interim President and
Chief Executive Officer of Iomega. You will serve in that capacity until
the earlier of (a) the date that Xxxxxx employs a new Chief Executive
Officer or (b) March 25, 1999.
2. In consideration of your services, Xxxxxx agrees to the following:
(a) Initial Shares. Effective March 25, 1998, Iomega will issue
to you (from its treasury) that number of shares of common stock of
Iomega ("Initial Shares") equal to the quotient of $360,000 divided by
the closing price of the common stock of Iomega ("Iomega Stock") on
the New York Stock Exchange ("Exchange") on March 25, 1998.
(b) Monthly Shares. On October 25, 1998 and on the 25th day of
each of the succeeding five months thereafter (each such 25th day, an
"Award Date"), Iomega will issue to you (from its treasury) that
number of shares of Iomega Stock ("Monthly Shares") equal to the
quotient of $60,000 divided by the closing price of Iomega Stock on
the Exchange on the applicable Award Date, provided, however, that
each award of Monthly Shares shall be subject to your continued
service, on the applicable Award Date, as Interim President and Chief
Executive Officer of Iomega. Xxxxxx's obligation to issue Monthly
Shares to you on each Award Date shall terminate from and after the
date that you cease serving as Interim President and Chief Executive
Officer of Iomega (whether such cessation is voluntary or
involuntary). In the event you cease serving as Interim President and
Chief Executive Officer of Iomega between the 25th day of one month
and the 25th day of the succeeding month, you will be entitled to a
prorata portion of the shares that you would have otherwise received
had you continued to serve for the entire monthly period, such prorata
portion to be determined by multiplying $60,000 by a fraction of which
the numerator is the number of days served during that period and the
denominator is 30, and the "Award Date" for this purpose shall be the
date that you cease serving as Interim President and Chief Executive
Officer.
Xx. Xxxxx X. Xxxxx
March 25, 1998
Page 2
(c) Initial Option Grant. Effective March 25, 1998, Iomega will
grant to you a non-statutory stock option for the purchase of 50,000
shares of Iomega Stock pursuant to the terms of Iomega's 1997 Stock
Incentive Plan ("Initial Option Grant") exercisable at a price per
share equal to the closing price of the Iomega Stock on the Exchange
on March 25, 1998. The Initial Option Grant may be exercised by you
after, but not prior to, March 25, 1999.
(d) Monthly Option Grant. On April 25, 1998 and on the 25th day
of each of the succeeding eleven months thereafter (each such 25th
day, an "Option Grant Date"), Iomega will grant you a non-statutory
stock option for the purchase of 7,500 shares of Iomega Stock
("Monthly Option Grant"), provided, however, that each Monthly Option
Grant shall be subject to your continued service, on the applicable
Option Grant Date, as Interim President and Chief Executive Officer of
Iomega. Each such option shall be exercisable at a price per share
equal to the closing price of Iomega Stock on the Exchange on the
applicable Option Grant Date. Each Monthly Option Grant may be
exercised by you after, but not before, the expiration of the
twelve-month period following the applicable Option Grant Date.
Xxxxxx's obligation to grant you a Monthly Option Grant on each Option
Grant Date shall terminate from and after the date you cease serving
as Interim President and Chief Executive Officer of Iomega (whether
such cessation is voluntary or involuntary). In the event you cease
serving as Interim President and Chief Executive Officer of Iomega
between the 25th day of one month and the 25th day of the succeeding
month, you will be entitled to a prorata portion of the Monthly Option
Grant that you would have otherwise received had you continued to
serve for the entire monthly period, such prorata portion to be
determined by multiplying 7,500 by a fraction of which the numerator
is the number of days served during that period and the denominator is
30, and the "Option Grant Date" for this purpose shall be the date
that you cease serving as Interim President and Chief Executive
Officer.
3. In the event that you are continuing to serve as Interim President
and Chief Executive Officer on March 25, 1999, Xxxxxx agrees that you shall
be entitled to participate in the Iomega Executive Bonus Plan, based upon
the performance of Iomega for the last three quarters of 1998 and the first
quarter of 1999.
4. If required, Xxxxxx agrees to register for resale the shares of
Iomega Stock issued pursuant to Section 2(a) and 2(b) under the federal
securities laws.
Xx. Xxxxx X. Xxxxx
March 25, 1998
Page 3
If this letter accurately sets forth the terms and provisions regarding
your service as Interim President and Chief Executive Office, please sign the
duplicate copy of this letter and return it to me, whereupon (i) this letter
will constitute a binding agreement between Iomega and you and (ii) Iomega will
deliver to you a certificate for the Initial Restricted Shares described in
Section 2(a) and a stock option agreement for the Initial Option Grant described
in Section 2(c).
Very truly yours,
AGREED AND ACCEPTED IOMEGA CORPORATION
/s/ Xxxxx X. Xxxxx By /s/ Xxxxx X. Xxxx
Xxxxx X. Xxxxx Xxxxx X. Xxxx
Chairman of the Board
