EMPLOYMENT AGREEMENT
EXHIBIT
10.1
This
AGREEMENT (the “Agreement”)
is
made March
1,
2007, by and between HYDROGEN POWER, INC., a Delaware corporation (the
“Company”),
and
Xxxxx X. Xxxx (the “Executive”).
W
I T N E S S E T H:
WHEREAS,
the Company desires to retain Executive, and Executive desires to commence
serving the Company, as its Chief Operating Officer, upon the terms and subject
to the conditions contained in this Agreement;
NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the parties hereto hereby agree as follows:
1. Employment.
The
Company agrees to employ the Executive, and the Executive agrees to be employed
by the Company, upon the terms and subject to the conditions of this
Agreement.
2. Term.
The
employment of the Executive by the Company as provided in Section 1
shall be
for a period of three (3) years commencing on the date hereof, unless sooner
terminated in accordance with the provisions of Section 9
below
(the “Term”).
3. Duties;
Best Efforts; Place of Performance.
(a) The
Executive shall serve as Chief Operating Officer of the Company and shall
perform, subject to the direction of the Board of Directors of the Company
(the
“Board”),
such
duties as are customarily performed by the Chief Operating Officer. The
Executive shall also have such other powers and duties as may be from time
to
time directed by the Board, provided that the nature of the Executive’s powers
and duties so prescribed shall not be inconsistent with the Executive’s position
and duties hereunder.
(b) The
Executive shall devote substantially all of his business time, attention and
energies to the business and affairs of the Company
and
shall use his best efforts to advance the best interests of the Company and
shall not during the Term be actively engaged in any other business activity
(except as expressly permitted below), whether or not such business activity
is
pursued for gain, profit or other pecuniary advantage, that will interfere
with
the performance by the Executive of his duties hereunder or the Executive’s
availability to perform such duties or that will adversely affect, or negatively
reflect upon, the Company.
(c) During
the Term, as directed by the Board, the Executive shall provide on at least
a
monthly basis a written report detailing the progress on the Company’s
achievement of certain milestones, as attached hereto as Exhibit
A
(the
“Milestones”).
(d) During
the Term, the Executive shall consult, as directed by the Board, prior to making
significant decisions relating to the Company’s personnel, operations, contracts
or financing.
4. Compensation.
As full
compensation for the performance by the Executive of his duties under this
Agreement, the Company shall pay the Executive as follows:
(a) Base
Salary.
During
the Term, Executive shall be entitled to receive from the Company a base salary
(the “Base
Salary”)
equal
to:
(i)
During
the first year of the Term:
| (1) |
For
the period from March 1, 2007 to August 31, 2007, a rate of $200,000
per
annum; and
|
| (2) |
For
the period from September 1, 2007 to February 29, 2008, a rate of
$225,000
per annum;
|
(ii) for
each
of the second and third years of the Term, at a rate agreed upon by the
Executive and the Board. In the event the compensation for each such year of
the
Term is not determined by the parties on or prior to March 1, 2008 and March
1,
2009, respectively, the Executive shall be entitled to (i) continue his
employment at the same Base Salary as he earned immediately prior to such date,
or (ii) in the event Executive resigns from his position, the compensation
set
forth in Section 10(e);
provided
that,
in the
event the Company offers to pay the Executive a Base Salary for such year of
the
Term equal to at least 110% of his Base Salary for the prior year of the Term
and the Executive elects to resign from his position in lieu of acceptance
of
such offer, Executive shall be entitled to the compensation set forth in Section
10(a)
instead
of Section 10(e).
Base
Salary shall be payable in equal semi-monthly installments during the Term,
or
otherwise in accordance with the Company’s regular payroll practices in effect
from time to time.
(b) Stock
Option Grant.
The
Company shall grant the Executive a stock option to purchase 900,000 shares
of
the Company’s common stock, par value $0.01
per
share (the “Common
Stock”)
at an
exercise price of $1.60 per share (the “Option”)
based
on his performance on behalf of the Company and in accordance with Section
4(c).
The Option shall be governed by the Company’s 2005 Stock Option Plan (the
“Plan”).
For
so long as the Executive is an employee of the Company, the Option shall vest,
if at all, in three equal and annual installments beginning on the first
anniversary of the date hereof. Upon termination of Executive’s employment with
the Company, for any reason or no reason, Executive’s rights to any portion of
the Option that has not yet vested as of the date of such termination shall
not
vest and all of Executive’s rights to such unvested portion of the Option shall
terminate. In the event of a Change of Control (as such term is defined in
the
Plan), the entire Option shall vest and become immediately exercisable. The
Option shall have a term of 5 years from date of grant and the vested Options
shall remain exercisable for 90 days from the date that the Executive is no
longer an employee of the Company. In connection with such grant, the Executive
shall enter into the Company’s standard stock option agreement which will
incorporate the foregoing vesting schedule and other terms described in this
Section 4(b).
(c) The
above
Option will be granted each Fiscal Quarter to the Executive for up to 75,000
shares of Common Stock (such amount subject to increase based on the terms
set
forth herein) at an exercise price of $1.60 per share. The number of shares
for
each such grant during the Term shall be determined by the Board in its
reasonable discretion after discussion with the Executive as to the achievement
of Milestones. To the extent any option grant under this Section relates to
less
than 75,000 shares of Common Stock, the number of option shares that is equal
to
the difference between (A) the number of options shares actually granted for
such fiscal quarter and (B) 75,000, shall be eligible for issuance pursuant
to
subsequent option grants made pursuant to this Section. By way of example,
if in
Quarter 1, the Executive is issued an option to purchase 50,000
2
shares
of
Common Stock, the amount of shares potentially subject to the option grant
under
this Section 4(c) in Quarter 2 shall be 100,000. In the event the Executive
is
issued an option to purchase 35,000 shares of Common Stock in Quarter 2, the
number of shares potentially subject to the option grant in Quarter 3 shall
be
140,000. Options issued under this Section shall vest in full at the end of
the
year of the Term in
which
they are granted.
(d) Discretionary
Bonus.
Each
fiscal quarter during the Term, the Executive shall be eligible to receive
a
cash bonus in an amount of up to $10,000, to be payable either as a lump-sum
payment or in installments as determined by the Board in its sole discretion,
based upon his performance on behalf of the Company during the fiscal quarter
and the satisfaction of the Milestones, each of which shall be determined by
the
Board in its good faith discretion.
(e) Withholding.
The
Company shall withhold all applicable federal, state and local taxes and social
security and such other amounts as may be required by law from all amounts
payable to the Executive under this Section 4.
(f) Home
Office Expenses.
The
Company shall reimburse executive for reasonable expenses incurred by Executive
relating to maintaining a landline and cellular phone service, internet service
and office supplies at Executive’s home office, in an amount not to exceed
$700.00 per month.
The
reimbursement shall exclude any expenses relating to the use of office space
and
any utilities not specifically identified herein.
(g) Expenses.
The
Company shall reimburse the Executive for all normal, usual and necessary
expenses incurred by the Executive in furtherance of the business and affairs
of
the Company, including reasonable travel and entertainment, upon timely receipt
by the Company of appropriate vouchers or other proof of the Executive’s
expenditures and otherwise in accordance with any expense reimbursement policy
as may from time to time be adopted by the Company.
(h) Other
Benefits.
The
Executive shall be entitled to all rights and benefits for which he shall be
eligible under any benefit or other plans (including, without limitation,
dental, medical, medical reimbursement and hospital plans, pension plans,
employee stock purchase plans, profit sharing plans, bonus plans and other
so-called “fringe” benefits) as the Company shall make available to its senior
executives from time to time. During the Term, the Executive shall be entitled
to undergo, at the Company’s expense (if not covered under such aforementioned
plans), an annual physical examination by his family physician.
(i) Vacation.
Executive shall, during the Term, be entitled to twenty (20) days of vacation
per annum,
in
addition to holidays observed by the Company.
5. Registration
Rights.
The
Company agrees to use commercially reasonable efforts to register the resale
of
any shares of Common Stock underlying options granted to Executive pursuant
to
Sections 4(b),
including, if appropriate, filing a supplement to the Company’s prospectus dated
February 14, 2006 relating to shares of Common Stock issued under the Plan
to
include Executive as a selling stockholder with respect to 685,000 shares of
Common Stock or otherwise registering such shares for resale on a Form S-8
registration statement.
6. Confidential
Information and Inventions.
(a) The
Executive recognizes and acknowledges that in the course of his duties he is
likely to receive confidential or proprietary information owned by the Company,
its affiliates or third parties with whom the Company or any such affiliates
has
an obligation of confidentiality. Accordingly, during and after the Term, the
Executive agrees to keep confidential and not disclose or make accessible to
any
other person or use for any other purpose other than in connection with the
fulfillment of his duties under this Agreement, any Confidential and Proprietary
Information (as
3
defined
below) owned by, or received by or on behalf of, the Company or any of its
affiliates. “Confidential
and Proprietary Information”
shall
include, but shall not be limited to, confidential or proprietary scientific
or
technical information, data, formulas and related concepts, business plans
(both
current and under development), client lists, promotion and marketing programs,
trade secrets, or any other confidential or proprietary business information
relating to development programs, costs, revenues, marketing, investments,
sales
activities, promotions, credit and financial data, manufacturing processes,
financing methods, plans or the business and affairs of the Company or of any
affiliate or client of the Company. The Executive expressly acknowledges the
trade secret status of the Confidential and Proprietary Information and that
the
Confidential and Proprietary Information constitutes a protectable business
interest of the Company. The Executive agrees: (i) not to use any such
Confidential and Proprietary Information for himself or others; and (ii) not
to
take any Company material or reproductions (including but not limited to
writings, correspondence, notes, drafts, records, invoices, technical and
business policies, computer programs or disks) thereof from the Company’s
offices at any time during his employment by the Company, except as required
in
the execution of the Executive’s duties to the Company. The Executive agrees to
return immediately all Company material and reproductions (including but not
limited, to writings, correspondence, notes, drafts, records, invoices,
technical and business policies, computer programs or disks) thereof in his
possession to the Company upon request and in any event immediately upon
termination of employment.
(b) Except
with prior written authorization by the Company, the Executive agrees not to
disclose or publish any of the Confidential and Proprietary Information, or
any
confidential, scientific, technical or business information of any other party
to whom the Company or any of its affiliates owes an obligation of confidence,
at any time during or after his employment with the Company.
(c) The
Executive agrees that all inventions, discoveries, improvements and patentable
or copyrightable works (“Inventions”)
initiated, conceived or made by him, either alone or in conjunction with others,
during the Term
shall be
the sole property of the Company to the maximum extent permitted by applicable
law and, to the extent permitted by law, shall be “works made for hire” as that
term is defined in the United States Copyright Act (17 U.S.C.A., Section 101).
The Company shall be the sole owner of all patents, copyrights, trade secret
rights, and other intellectual property or other rights in connection therewith.
The Executive hereby assigns to the Company all right, title and interest he
may
have or acquire in all such Inventions; provided, however, that the Board may
in
its sole discretion agree to waive the Company’s rights pursuant to this Section
6(c)
with
respect to any Invention that is not directly or indirectly related to the
Company’s business. The Executive further agrees to assist the Company in every
proper way (but at the Company’s expense) to obtain and from time to time
enforce patents, copyrights or other rights on such Inventions in any and all
countries, and to that end the Executive will execute all documents
necessary:
(i) to
apply
for, obtain and vest in the name of the Company alone (unless the Company
otherwise directs) letters patent, copyrights or other analogous protection
in
any country throughout the world and when so obtained or vested to renew and
restore the same; and
4
(ii) to
defend
any opposition proceedings in respect of such applications and any opposition
proceedings or petitions or applications for revocation of such letters patent,
copyright or other analogous protection.
(d) The
Executive acknowledges that while performing the services under this Agreement
the Executive may locate, identify and/or evaluate patented or patentable
inventions having commercial potential in the field of alternative energies
and
other fields which may be of potential interest to the Company or one of its
affiliates (the “Third
Party Inventions”).
The
Executive understands, acknowledges and agrees that all rights to, interests
in
or opportunities regarding, all Third-Party Inventions identified by the
Company, any of its affiliates or either of the foregoing persons’ officers,
directors, employees (including the Executive), agents or consultants during
the
Employment Term shall be and remain the sole and exclusive property of the
Company or such affiliate and the Executive shall have no rights whatsoever
to
such Third-Party Inventions and will not pursue for himself or for others any
transaction relating to the Third-Party Inventions which is not on behalf of
the
Company.
(e) The
provisions above in Section 6 shall survive the termination of this
Agreement.
7. Non-Competition,
Non-Solicitation and Non-Disparagement.
(a) The
Executive understands and recognizes that his services to the Company are
special and unique and that in the course of performing such services the
Executive will have access to and knowledge of Confidential and Proprietary
Information (as defined in Section 6)
and the
Executive agrees that, during the Term and for a period of eighteen
(18)
months
thereafter, he shall not in any manner, directly or indirectly, on behalf of
himself or any person, firm, partnership, joint venture, corporation or other
business entity (“Person”),
enter
into or engage in any business which is engaged in any business directly or
indirectly competitive with the business of the Company, either as an individual
for his own account, or as a partner, joint venturer, owner, executive,
employee, independent contractor, principal, agent, consultant, salesperson,
officer, director or shareholder of a Person in a business competitive with
the
Company within the geographic area of the Company’s business, which is deemed by
the parties hereto to be worldwide. The Executive acknowledges that, due to
the
unique nature of the Company’s business, the loss of any of its clients or
business flow or the improper use of its Confidential and Proprietary
Information could create significant instability and cause substantial damage
to
the Company and its affiliates and therefore the Company has a strong legitimate
business interest in protecting the continuity of its business interests and
the
restriction herein agreed to by the Executive narrowly and fairly serves such
an
important and critical business interest of the Company. Notwithstanding the
foregoing, nothing contained in this Section 7(a)
shall be
deemed to prohibit the Executive from (i) acquiring or holding, solely for
investment, publicly traded securities of any corporation, some or all of the
activities of which are competitive with the business of the Company so long
as
such securities do not, in the aggregate, constitute more than three percent
(2%) of any class or series of outstanding securities of such
corporation.
(b) During
the Term and for a period of 18 months thereafter, the Executive shall not,
directly or indirectly, without the prior written consent of the
Company:
(i) solicit
or induce any employee of the Company or any of its affiliates to leave the
employ of the Company or any such affiliate; or hire for any purpose any
employee of the Company or any affiliate or any employee who has left the
employment of the Company or any affiliate within one year of the termination
of
such employee’s employment with the Company or any such affiliate or at any time
in violation of such employee’s non-competition agreement with the Company or
any such affiliate; or
5
(ii) solicit
or accept employment or be retained by any Person who, at any time during the
term of this Agreement, was an agent, client or customer of the Company or
any
of its affiliates where his position will be related to the business of the
Company or any such affiliate; or
(iii) solicit
or accept the business of any agent, client or customer of the Company or any
of
its affiliates with respect to products, services or investments similar to
those provided or supplied by the Company or any of its affiliates.
(c) The
Executive agrees that both during the Term and at all times thereafter, he
shall
not directly or indirectly disparage, whether or not true, the name or
reputation of the Company or any of its affiliates, including but not limited
to, any officer, director, employee or shareholder of the Company or any of
its
affiliates.
(d) In
the
event that the Executive breaches any provisions of Section 6
or this
Section 7
or there
is a threatened breach, then, in addition to any other rights which the Company
may have, the Company shall (i) be entitled, without the posting of a bond
or
other security, to injunctive relief to enforce the restrictions contained
in
such Sections and (ii) have the right to require the Executive to account for
and pay over to the Company all compensation, profits, monies, accruals,
increments and other benefits (collectively “Benefits”)
derived or received by the Executive as a result of any transaction constituting
a breach of any of the provisions of Sections 6
or
7
and the
Executive hereby agrees to account for and pay over such Benefits to the
Company.
(e) Each
of
the rights and remedies enumerated in Section 7(d)
shall be
independent of the others and shall be in addition to and not in lieu of any
other rights and remedies available to the Company at law or in equity. If
any
of the covenants contained in this Section 7,
or any
part of any of them, is hereafter construed or adjudicated to be invalid or
unenforceable, the same shall not affect the remainder of the covenant or
covenants or rights or remedies which shall be given full effect without regard
to the invalid portions. If any of the covenants contained in this Section
7
is held
to be invalid or unenforceable because of the duration of such provision or
the
area covered thereby, the parties agree that the court making such determination
shall have the power to reduce the duration and/or area of such provision and
in
its reduced form such provision shall then be enforceable. No such holding
of
invalidity or unenforceability in one jurisdiction shall bar or in any way
affect the Company’s right to the relief provided in this Section 7
or
otherwise in the courts of any other state or jurisdiction within the
geographical scope of such covenants as to breaches of such covenants in such
other respective states or jurisdictions, such covenants being, for this
purpose, severable into diverse and independent covenants.
(f) In
the
event that an actual proceeding is brought in equity to enforce the provisions
of Section 6
or
this
Section 7,
the
Executive shall not urge as a defense that there is an adequate remedy at law
nor shall the Company be prevented from seeking any other remedies which may
be
available. The Executive agrees that he shall not raise in any proceeding
brought to enforce the provisions of Section 6
or this
Section 7
that the
covenants contained in such Sections limit his ability to earn a
living.
6
(g) The
provisions of this Section 7
shall
survive any termination of this Agreement.
8. Representations
and Warranties by the Executive.
The
Executive hereby represents and warrants to the Company as follows:
(a) Neither
the execution or delivery of this Agreement nor the performance by the Executive
of his duties and other obligations hereunder violate or will violate any
statute, law, determination or award, or conflict with or constitute a default
or breach of any covenant or obligation under (whether immediately, upon the
giving of notice or lapse of time or both) any prior employment agreement,
contract, or other instrument to which the Executive is a party or by which
he
is bound.
(b) The
Executive has the full right, power and legal capacity to enter and deliver
this
Agreement and to perform his duties and other obligations hereunder. This
Agreement constitutes the legal, valid and binding obligation of the Executive
enforceable against him in accordance with its terms. No approvals or consents
of any persons or entities are required for the Executive to execute and deliver
this Agreement or perform his duties and other obligations
hereunder.
9. Termination.
The
Executive’s employment hereunder shall be terminated upon the Executive’s death
and may be terminated as follows:
(a) During
the first year of the Term, the Company or the Executive may terminate
Executive’s employment hereunder upon two (2) months written notice to the other
party.
(b) At
any
time during the Term, the Executive’s employment hereunder may be terminated by
the Board for Cause. Any of the following actions by the Executive shall
constitute “Cause”:
(i) The
willful failure, disregard or refusal by the Executive to perform his duties
hereunder;
(ii) Any
willful, intentional or grossly negligent act by the Executive having the effect
of injuring, in a material way (whether financial or otherwise and as determined
in good-faith by a majority of the Board), the business or reputation of the
Company or any of its affiliates, including but not limited to, any officer,
director, executive or shareholder of the Company or any of its affiliates;
(iii) Willful
misconduct by the Executive
in
respect of the duties or obligations of the Executive under this
Agreement,
including, without limitation, insubordination with respect to directions
received by the Executive from the Board;
(iv) The
Executive’s indictment of any felony or a misdemeanor involving moral turpitude
(including entry of a nolo contendere plea);
(v) The
determination by the Company, after a reasonable and good-faith investigation
by
the Company following a written allegation by another employee of the Company,
that the Executive engaged in some form of harassment prohibited
by law
(including, without limitation, age, sex or race discrimination),
unless
the Executive’s actions were specifically directed by the Board;
7
(vi) Any
misappropriation or embezzlement of the property of the Company or its
affiliates (whether or not a misdemeanor or felony);
(vii) Breach
by
the Executive of any of the provisions of Sections
7
or
8
of this
Agreement; and
(viii) Breach
by
the Executive of any provision of this Agreement other than those contained
in
Sections 7
or
8
which is
not cured by the Executive within thirty (30) days after notice thereof is
given
to the Executive by the Company.
(c) The
Executive’s employment hereunder may be terminated by the Board due to the
Executive’s Disability. For purposes of this Agreement, a termination for
“Disability”
shall
occur (i) when the Board has provided a written termination notice to the
Executive supported by a written statement from a reputable independent
physician to the effect that the Executive shall have become so physically
or
mentally incapacitated as to be unable to resume, within the ensuing twelve
(12)
months, his employment hereunder by reason of physical or mental illness or
injury, or (ii) upon rendering of a written termination notice by the Board
after the Executive has been unable to substantially perform his duties
hereunder for 90 or more consecutive days, or more than 120 days in any
consecutive twelve month period, by reason of any physical or mental illness
or
injury. For purposes of this Section 9(c),
the
Executive agrees to make himself available and to cooperate in any reasonable
examination by a reputable independent physician retained by the
Company.
(d) The
Executive’s employment hereunder may be terminated by the Board (or its
successor) upon the occurrence of a Change of Control. For purposes of this
Agreement, “Change
of Control”
means
(i) the acquisition, directly or indirectly, following the date hereof by any
person (as such term is defined in Section 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended), in one transaction or a series of related
transactions, of securities of the Company representing in excess of fifty
percent (50%) or more of the combined voting power of the Company’s then
outstanding securities if such person or his or its affiliate(s) do not own
in
excess of 50% of such voting power on the date of this Agreement, or (ii) the
future disposition by the Company (whether direct or indirect, by sale of assets
or stock, merger, consolidation or otherwise) of all or substantially all of
its
business and/or assets in one transaction or series of related transactions
(other than a merger effected exclusively for the purpose of changing the
domicile of the Company).
10. Compensation
upon Termination.
(a) If
the
Executive’s employment is terminated as a result of his death or pursuant to
Sections 9(a)
or
9(c),
the
Company shall pay to the Executive or to the Executive’s estate, as applicable,
his
Base
Salary and any earned and unpaid Discretionary Bonus and expense reimbursement
amounts through the date of his death or Disability.
(b) If
the
Executive’s employment is terminated by the Board for Cause during the first
year of the Term, then the Company shall pay to the Executive his Base Salary
through the remainder of the first year of the Term and the Executive shall
have
no further entitlement to any other compensation or benefits from the
Company.
(c) If
the
Executive’s employment is terminated by the Board for Cause during the second or
third year of the Term, then the Company shall pay to the Executive his Base
Salary through the date of his termination and the Executive shall have no
further entitlement to any other compensation or benefits from the
Company.
8
(d) If
the
Executive’s employment is terminated by the Company (or its successor) upon the
occurrence of a Change of Control, the Company (or its successor, as applicable)
shall continue to pay to the Executive his Base Salary through the date of
termination and for a period of twelve (12) months following such termination.
Notwithstanding anything to the contrary contained herein, in the event it
is
determined that any payment or other distribution by the Company to or for
the
benefit of Executive would constitute an “excess parachute provision” within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”),
such
payment or distribution shall be reduced as necessary to (1) avoid the
imposition of any excise tax liability on Executive under Section 4999 of the
Code and (2) allow the entire amount of such payment or distribution to be
deductible by the Company.
(e) If
the
Executive’s employment is terminated by the Company other than as a result of
the Executive’s death and other than for reasons specified in Sections
9(a),
9(b),
9(c)
or
9(d),
then
the Company shall (i) continue to pay to the Executive his Base Salary for
a
period of twelve (12) months following such termination, (ii) pay the Executive
any earned and unpaid Discretionary Bonus and expense reimbursement amounts
owed
through the date of termination and (iii) continue to provide the Executive
and
his family for a period of twelve (12) months the medical and dental benefits
the Executive was receiving immediately prior to the termination date, or,
in
the event the Company cannot continue to provide such benefits to the Executive,
to reimburse Executive an amount equal to the Company’s cost of providing the
Executive and his family such benefits for the twelve (12) months immediately
prior to the termination date, such amount payable in twelve equal monthly
installments. The Company’s obligation under clauses (i), (ii) and (iii) in the
preceding sentence shall be subject to offset by any amounts otherwise received
by the Executive from any employment during the one year period following the
termination of his employment.
(f) This
Section 10
sets
forth the only obligations of the Company with respect to the termination of
the
Executive’s employment with the Company, and the Executive acknowledges that,
upon the termination of his employment, he shall not be entitled to any payments
or benefits which are not explicitly provided in Section 10.
Further, notwithstanding anything to the contrary contained in this Section
10,
the
Company shall have no obligation to pay, and Executive shall have no obligation
to receive, any compensation, benefits or other consideration provided for
in
this Section 10
following termination of Executive’s employment unless Executive executes a
separate agreement releasing the Company from any and all liability in
connection with the termination of Executive’s employment.
(g) Upon
termination of the Executive’s employment hereunder for any reason, the
Executive shall be deemed to have resigned as director of the Company, effective
as of the date of such termination.
(h) The
provisions of this Section 10
shall
survive any termination of this Agreement.
11. Miscellaneous.
(a) This
Agreement shall be governed by, and construed and interpreted in accordance
with, the laws of the State of Delaware, without giving effect to its principles
of conflicts of laws.
9
(b) Any
dispute arising out of, or relating to, this Agreement or the breach thereof
(other than Sections 7 or 8 hereof), or regarding the interpretation thereof,
shall be finally settled by arbitration conducted in Seattle, Washington and
in
accordance with the rules of the American Arbitration Association then in effect
before a single arbitrator appointed in accordance with such rules. Judgment
upon any award rendered therein may be entered and enforcement obtained thereon
in any court having jurisdiction. The arbitrator shall have authority to grant
any form of appropriate relief, whether legal or equitable in nature, including
specific performance. For the purpose of any judicial proceeding to enforce
such
award or incidental to such arbitration or to compel arbitration and for
purposes of Sections 7
and 8
hereof, the parties hereby submit to the non-exclusive jurisdiction of the
courts of the State of Washington, King County, or the United States District
Court for the Western District of Washington, and agree that service of process
in such arbitration or court proceedings shall be satisfactorily made upon
it if
sent by registered mail addressed to it at the address referred to in paragraph
(g)
below.
The
costs
of such arbitration shall be borne proportionate to the finding of fault as
determined by the arbitrator. Judgment on the arbitration award may be entered
by any court of competent jurisdiction.
(c) This
Agreement shall be binding upon and inure to the benefit of the parties hereto,
and their respective heirs, legal representatives, successors and
assigns.
(d) This
Agreement, and the Executive’s rights and obligations hereunder, may not be
assigned by the Executive. The Company may assign its rights, together with
its
obligations, hereunder in connection with any sale, transfer or other
disposition of all or substantially all of its business or assets.
(e) This
Agreement cannot be amended orally, or by any course of conduct or dealing,
but
only by a written agreement signed by the parties hereto.
(f) The
failure of either party to insist upon the strict performance of any of the
terms, conditions and provisions of this Agreement shall not be construed as
a
waiver or relinquishment of future compliance therewith, and such terms,
conditions and provisions shall remain in full force and effect. No waiver
of
any term or condition of this Agreement on the part of either party shall be
effective for any purpose whatsoever unless such waiver is in writing and signed
by such party.
(g) All
notices, requests, consents and other communications, required or permitted
to
be given hereunder, shall be in writing and shall be delivered personally or
by
an overnight courier service or sent by registered or certified mail, postage
prepaid, return receipt requested, to the parties at the addresses set forth
below, and shall be deemed given when so delivered personally or by overnight
courier, or, if mailed, five days after the date of deposit in the United States
mails. Either party may designate another address, for receipt of notices
hereunder by giving notice to the other party in accordance with this paragraph
(g).
|
If
to the Company:
|
Hydrogen
Power, Inc.
000
Xxxxxxx Xxx. X., Xxxxx 000
Xxxxxxx,
XX 00000
Facsimile:
(000) 000-0000
Attn:
Chairman of the Board of Directors
|
10
|
If
to Executive:
|
Xxxxx
X. Xxxx
000
Xxxxxxxx Xxxx
Xxxxxx
Xxxxxxx, XX 00000
|
(h) This
Agreement sets forth the entire agreement and understanding of the parties
relating to the subject matter hereof, and supersedes all prior agreements,
arrangements and understandings, written or oral, relating to the subject matter
hereof. No representation, promise or inducement has been made by either party
that is not embodied in this Agreement, and neither party shall be bound by
or
liable for any alleged representation, promise or inducement not so set
forth.
(i) As
used
in this Agreement, “affiliate” of a specified Person shall mean and include any
Person controlling, controlled by or under common control with the specified
Person.
(j) The
section headings contained herein are for reference purposes only and shall
not
in any way affect the meaning or interpretation of this Agreement.
(k) This
Agreement may be executed in any number of counterparts, each of which shall
constitute an original, but all of which together shall constitute one and
the
same instrument.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date
first above written.
|
HYDROGEN
POWER, INC.
|
|
|
By
/s/ Xxxxx Xxxxxx
|
|
|
Its
Special Counsel
|
|
|
EXECUTIVE:
|
|
| /s/ Xxxxx X. Xxxx | |
|
Xxxxx
X. Xxxx
|
11
EXHIBIT
A
Milestones
Milestones
for CEO Evaluation
1.
Attract Investment
The
next
milestone involves progress in securing an investment term sheet from one or
more major strategic partner/investors and/or equity capital investors. The
intention is to raise $3 to 5 million through private placement(s) in the near
term.
2.
Product Development
The
next
milestone is to move the current low power benchtop prototype developed in
the
Seattle lab to a more finished prototype that can be demonstrated offsite.
Additional milestones are alpha stage and beta stage field trial units in
advance of initial production configuration. Technical
requirements:
| · |
Fuel
- increase energy density, create orientation independence and reduce
costs.
|
| · |
Cartridge
- develop sizing, coupling and internal
features.
|
| · |
Reactor
- Improve cartridge loading (ease of operations), field hydration,
refine
thermal management.
|
| · |
Controls
- develop hot swappable algorithms, refine hybrid load
handling.
|
| · |
Fuel
Cell - Ensure optimal FC operation with respect to H2 stream, purge
and
cooling.
|
| · |
Housing
- protect internals, dissipate heat, EMP protection, professional
casing
design.
|
Another
milestone is to complete development of the hybrid Ford Ranger truck with on-
board hydrogen generation. Additional milestones encompass demonstrating the
system to selected government and industry players.
Another
milestone is to begin development of 1Kw module, with additional milestones
for
proceeding through prototype stage, and alpha and beta stage field trials,
leading to initial production.
3.
Commercial Partners
The
next
milestone is to develop a commercial relationship with one or more major
business partners who needs our technology and brings third party endorsement
to
our products. Of equal importance is development of a strong commercial
relationship with a Fuel Cell provider including a merger and/or development
of
our own Fuel Cell to be integrated with our hydrogen production technology,
with
assembly in-house or outsourced.
These
milestones will be reviewed for their appropriateness every 6 months and any
changes will be negotiated between HPI and Xxxx.
