Sample Business Contracts

Employment Agreement - Audible Inc. and Andrew J. Huffman

Employment Forms

  • Employment Contract. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
  • Consulting Agreement. Answer simple questions to build a contract with a consultant. Specify the services rendered, when payment is due, as well as IP rights.
  • Commission Agreement. Employers who compensate their sales employees based on commissions can prepare an agreement to reduce misunderstandings by specifying the base salary and how commissions are calculated.
  • Executive Employment Agreement. Companies may offer their business executives a contract that is different from the one provided to their regular employees. Executive employment agreements may be more complex because the compensation structure may include a combination of salary and commissions, provide for bonuses based on sales, stock or other financial targets, and include non-compete, confidentiality and severance provisions.
  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
  • More Employment Agreements

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                            [LETTERHEAD OF AUDIBLE]

Mr. Andrew J. Huffman
18 Grasmere Lane
Nashua, NH 03063

February 12th, 1998

Dear Andy,

This is the single most important action we've taken since we started the
company. On a personal plane, we're more excited about this than anything else
we have done. We -- our management team and our Board -- are tremendously
impressed by your experience, your intellect, your competitiveness and your
integrity. We are convinced that under your leadership, Audible will soar to
great success.

Here's a summary of our employment offer, with details following after:

          .    You will become Chief Executive Officer, President and a member
               of the Board.

          .    You will have the right to purchase 1,000,000 shares of common
               stock at $0.40/share.

          .    You will be paid $180,000/year, with an annual bonus of $90,000
               paid quarterly.

          .    You will be enrolled in the company's benefits programs.

          .    We will cover relocation costs up to $20,000.

          .    You will agree to commence work no later than March 2nd, 1998.

          .    We'd like your acceptance by close of business on February 13th,

And here are the details:

Stock purchase: the stock purchase offer is subject to our standard stock
purchase agreement with it's attendant tax and Rule 144 advantages over a stock
option plan. You have the right to purchase the shares immediately on
employment, and the price of the shares is payable in cash, by a company-held
promissory note or by a combination of both. The agreement gives the company a
dwindling repurchase right, which is effectively equivalent to a conventional 50
month cliff vesting program, such that the company loses the right to repurchase
12% of the stock six months after you commence employment, and 2% each month

Accelerated vesting: our standard stock purchase agreement provides for
automatic vesting of 50% of unvested shares in the event of a sale or merger of
the company prior to full vesting. It also provides that, at the time of the
transaction, additional accelerated vesting can be approved by the Board.

Quarterly bonus: we believe in a strong, results-oriented company culture and to
emphasize that, we have a performance-based, cash compensation plan for
executives and senior managers. Every quarter you will propose, for approval by
the Board compensation committee, a set of measurable objectives. At the end of
the quarter, and based on accomplishments against those adjectives, you will
recommend your bonus amount, again for approval by that committee.


Benefits:  the company has a standard health plan and will cover 100% of your
premium and 50% of your dependents' premiums. The time-off policy is 15 days of
paid leave a year (sick, mental health or vacation time) and 7 holiday days. The
company will also pay 25% of your annual membership at a health club close to
our offices.

Non-disclosure agreement:  our various preferred stock agreements require that
all employees sign the company's standard non-disclosure agreement.

Severance:  the company has no standard severance policy, but in your case will
provide for six months salary and benefits continuation in the event of
termination without cause.

Preferred liquidation preferences:  in essence, the preferred shareholders have
simple, not participating preferred, liquidation preferences on their paid-in
capital. As an example, in the event of a sale or merger with $18M paid-in
capital and 12M shares split 50/50 between common and preferred: if there were
proceeds up to $36M, the first $18M would be paid to the 6M preferred and any
excess over that would be shared by the 6M common; if the proceeds were over
$36M, the preferred would convert into common and all proceeds would be shared
by all 12M shares.

That's it. We can't wait for you to get started and your signature below
indicates you feel the same way.


Timothy Mott

Donald Katz
Current CEO and President

So agreed:

/s/ ANDREW J. HUFFMAN                 * acceptance contingent on the successful
-----------------------------           completion of $5M + round of financing
Andrew J. Huffman