SI Diamond Technology, Inc.
3006 Longhorn Blvd., Suite 107, Austin, TX 78758
Phone (512) 339-5020, Fax (512) 339-5021, WWW.CARBONTECH.NET
Memorandum of Understanding
February 20, 2002
Re: Proposed employment by EBT
Following is a summary of the key terms of the proposed employment arrangement between Electronic Billboard
Technology, Inc (“EBT”). and Jake Schroepfer (“Schroepfer”):
Title: Chief Executive Officer, Electronic Billboard Technology, Inc.
Board Position: To be nominated as a Member of the Board of Directors of both SI Diamond Technology, Inc.
and Electronic Billboard Technology, Inc.
Start date: March 1, 2002
Salary : $400,000 per year to be reviewed annually
Stock Options: 1.5 million options to purchase SIDT common stock, vesting quarterly over the three year
period commencing with your start date. These options will be priced based on the average closing stock price
for the month of February 2002 and are subject to compensation committee approval.
Bonus Stock Option Plan:
1. 250,000 options to be granted based on completion of a business plan for EBT within 30 days of
employment and upon attainment of cumulative EBT revenue of $2.0 million, starting on the employment
date. This revenue level must be attained within 12 months of employment, or the options are not granted.
2. 250,000 options to be granted if EBT achieves break even on a quarterly basis using EBITDA (Earnings
before Interest, Tax, Depreciation, and Amortization) within 24 months of employment. The quarters will
be measured using calendar quarters starting April 1, 2002.
3. 500,000 options to be granted if EBT achieves a 20% EBITDA on a quarterly basis by the end of the
third anniversary of employment, using the same definition of quarters as in item 2.
4. Annual performance reviews to be set up by the anniversary of each year’s employment with SIDT to
allocate further targets and stock option grants linked to expectations at that time.
For purposes of pricing the o