AMENDED AND RESTATED OF TERMS OF EMPLOYMENT
AMENDED AND RESTATED OF TERMS OF EMPLOYMENT
This Amended and Restated of Terms of Employment (the "Agreement") is made effective on this 1st day of January, 2010 (the "Effective Date") by and among Flux Power, Inc, a California based Corporation (the “Company”) located at 0000 Xxx Xxxxxx Xxx Xxxxx #X Xxxxx, XX 00000 and Xxxxx Xxxxxxx (“Employee and/or I”), with a home address of 00000 Xxxxxxx Xxxxxx, Xxx Xxxxx, XX 00000.
As a condition of employment with Company, Employee and Company agree to the following Terms of Employment:
| 1. | Employment, Duties and Acceptance |
| A. | Appointment. Company hereby employs Employee as the President and CEO to render exclusive and full-time services in an executive capacity to Company and to the subsidiaries of Company and to devote Employee’s best efforts to the affairs of the Company and to perform such duties as President and CEO except as provided in Section 6 below. |
| B. | Acceptance. Employee hereby accepts such employment and agrees to render such services. Employee agrees to render such services at Company's offices, but Employee will travel on temporary trips to such other place or places as may be required from time to time to perform the duties hereunder. |
| 2. | Compensation |
| A. | Salary. As compensation for all services to be rendered pursuant to this Agreement to or at the request of Company, Company agrees to compensate Employee a salary at the rate of one hundred sixty eight thousand dollars ($168,000) per annum. |
| B. | Bonus. |
| i. | Company agrees to pay Employee ten thousand dollars ($10,000) each for every ten million dollars ($10,000,000) in Net Revenue Company receives within a fiscal year to be calculated based on audited financials and paid within one quarter following the close of the fiscal year. For the purpose of this Agreement Net Revenue shall mean gross total revenue minus returns and any other negative revenue. |
| ii. | Company further agrees that for every twenty million dollars ($20,000.000.00) in Net Revenue with at least a ten percent 10% Gross Margin for a fiscal year that is achieved, a fiscal yearend bonus (“Bonus”) of twenty percent 20% of the Employee salary will be paid to Employee. For the purpose of this Agreement the definition of Gross Margin is Company’s total sales revenue minus the cost of goods sold, divided by the total sales revenue, expressed as a percentage. |
| iii. | At no time shall Company be forced to increase Company debt to pay any Bonus (“Self Financing”). |
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| 3. | EMPLOYMENT AT WILL |
Employee agrees that unless specifically stated in writing and signed by an authorized officer of the Company, subject to controlling law, any employment granted to Employee is at will and for an indefinite term, and that such employment may be terminated at any time (subject to such requirements as to notice as may be applicable) either by Employee or by the Company for any or no reason whatsoever, and Employee hereby waive and disclaim any express or implied covenants to the contrary. In accepting employment by Company, Employee agrees not to rely on any statements or representations, whether orally or in writing, by any officers, employees or agents of Company concerning the duration or term of employment, grounds and procedures for discharge or termination of employment, or any other terms and conditions of employment except those specifically stated in writing and signed by an authorized officer of Company. Employee further agrees and understands that the provisions of any employee handbooks, personnel manuals and any and all other written statements of or regarding personnel policies, practices or procedures that are or may be issued by Company or any official or department thereof from time to time do not and shall not constitute a contract of employment and create no vested rights; that any such provisions may be changed, revised, modified, suspended, cancelled, or eliminated by Company at an time without notice; and that they constitute guidelines only and may be disregarded either in individual or Company wide situations when in the sole opinion and judgment of Company circumstances so require.
| 4. | CONFIDENTIAL INFORMATION |
| A. | Company Information. Employee agrees at all times during the term of employment and thereafter, to hold in strictest confidence, and not to use, except for the benefit of Company, or to disclose to any person, firm or corporation without written authorization of Company, the Confidential Information of Company. Employee understands that “Confidential Information” means any Company proprietary information, technical data, trade secrets or know-how, including, but not limited to research, product plans, products, services, customer lists and customers (including, but not limited to customers of the Company on whom Employee call or with whom Employee became acquainted during the term of my employment), software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, financial or other business information disclosed to me by Company either directly or indirectly in writing, orally or by drawings or observation of parts or equipment. Company acknowledges that Confidential Information does not include any of the foregoing items that have become publicly known and made generally available through no wrongful act of Employee or of others who were under confidentiality obligations as to the item or items involved. |
| B. | Former Employer Information. Employee agrees not to improperly use or disclose any patent, copyright, proprietary information or trade secrets of any former or concurrent employer or other person or entity and will not bring onto the premises of the Company any unpublished document or proprietary information belonging to any such employer, person or entity unless consented to in writing by such employer, person, or entity. |
| C. | Third Party Information. Employee agrees and recognizes that Company has received and in the future will receive from third parties their confidential or proprietary information (such as, but not limited to, software programs provided by license) subject to a duty on Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes. Employee agrees to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out my work for Company consistent with Company’s agreement with such third party. I agree to comply with Company’s policies and procedures, as applicable from time to time, with respect to such information. |
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| 5. | INVENTIONS |
| A. | Inventions Retained. I agree not to use, incorporate or disclose any proprietary information or inventions which belong to me and relate to the Company’s proposed business, products or research and development and which are not assigned to the Company hereunder and belong to me prior to executing this agreement. |
| B. | Assignment of Inventions. I hereby assign and transfer to the Company all my rights, title and interest in and to all improvements, discoveries, designs, inventions, trade secrets, improvement works, documents and other data (whether or not copyrightable or patentable), made, conceived or first reduced to practice by me, (the “Innovations”) whether solely or jointly with others, during my period of employment with the Company which relate to the actual work I have performed or may perform for the Company. This Assignment Agreement does not require me to assign to the Company any Invention for which no equipment, supplies, facility, or trade secret information of Company was used and that was developed entirely on my own time, and does not relate to the business of Company or to Company’s actual or demonstrably anticipated research or development, or does not result from any work performed by my for Company. |
| C. | Maintenance of Records. I agree to assist Company, or its designee, at Company’s expense, in every proper way to secure the Company’s rights in the Inventions and any copyrights, patents, or other intellectual property rights relating thereto in any all countries, including the disclosure to Company of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments and all other instruments which Company shall deem necessary in order to apply for and obtain such rights and in order to assign and convey to Company, its successors, assigns, and nominees the sole and exclusive rights, title and interest in and to such Inventions, and any copyrights, patents, mask work rights or other intellectual property rights relating thereto. I agree that the obligation to execute or cause to be executed, when it is in my power to do so, and such instrument or papers shall continue after the termination of my employment. If Company is unable to secure my signature due to mental or physical incapacity or if I am otherwise unavailable or unable to sign or to apply for or pursue any application for any United States or foreign patents or for copyright registrations covering Inventions or original works of authorship assigned to the Company as above, then I hereby irrevocably designate and appoint Company and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the prosecution and issuance of letters patent or copyright registrations thereon with the same legal force and effect as if executed by me. |
| 6. | CONFLICTING EMPLOYMENT |
I agree that, during the term of my employment with Company, I will not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Company is now involved or becomes involved during the term of my employment, nor will I engage in any other activities that conflict with my obligations to Company unless prior authorization is provided by the Company which shall not be unduly authorized.
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| 7. | RETURNING COMPANY DOCUMENT |
I agree that, at the time I leave the employ of Company, I will deliver to Company (and will not keep in possession, recreate or deliver to anyone else) any and all devices, records, data, notes, reports, proposals, lists, correspondence, specifications drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items developed by me pursuant to employment with Company or otherwise belonging to Company, its successors or assigns. Upon termination of my employment for any reason, I agree to sign and deliver the “Termination Certification”.
| 8. | NOTIFICATION OF NEW EMPLOYER |
Upon termination of my employment for any reason, I hereby grant consent to notification by the Company to any subsequent employer about rights and obligations under the Agreement.
| 9. | SOLICITATION OF EMPLOYEES |
I agree that for a period of twelve (12) months immediately following the termination of my employment with Company for any reason, whether with or without cause, I shall not either directly or indirectly solicit, induce, recruit or encourage any of Company’s employees to leave their employment, or take away such employees, or attempt to solicit, induce, recruit, encourage or take away employees of Company, either for me or for any other person or entity.
| 10. | OTHER POLICIES |
I agree to comply with all Company policies, rules and procedures that are generally applicable to Company employees.
| 11. | EQUITABLE RELIEF |
I agree that it would be impossible or inadequate to measure and calculate Company’s damages from any breach of the covenants set forth in Sections 2, 3, 4, 5, and 7 herein. Accordingly, I agree that upon breech of any of such Sections, Company will have available, in addition to any other right or remedy available, the right to obtain an injunction from a court of competent jurisdiction restraining such breach or threatened breach and to specific performance of any such provision of this Agreement. I further agree that no bond or other surety shall be required in order to obtain such relief and I hereby consent to the issuance of such injunction and to any order of specific performance.
| 12. | ARBITRATION |
Except for equitable relief pursuant to Section 9 above, any dispute between the parties arising out of the Agreement shall be resolved through arbitration by a single arbitrator acting under the auspices and rules and regulations of the American Arbitration Association, located in San Diego, California, and in such event the decision of the arbitrator shall be binding upon the parties and enforceable in a court of competent jurisdiction. The parties agree to negotiate any dispute arising out of the Agreement in good faith.
| 13. | Severance |
In the event the Employee is terminated for any reason other than criminal activity, Company agrees to provide employee with a severance payout equal to six (6) months of employment.
| 14. | GENERAL PROVISIONS |
| A. | Governing Law; Consent to Personal Jurisdiction This Agreement will be governed by the laws of the State of California, and I hereby expressly consent to the personal jurisdiction of the state and federal courts located therein for any lawsuit filed there by the Company arising from or relating to my employment. |
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| B. | Entire Agreement. This Agreement, including all Attachments hereto, constitutes the parties’ entire agreement with respect to its subject matter, and supersedes and replaces all prior or contemporaneous understandings or agreements, written or oral, regarding such subject matter. |
| C. | Severability. If one or more of the clauses in this Agreement are deemed unenforceable, then the remaining clauses will continue in full force and effect. In the event a provision contained in any Restrictive Covenant shall be declared by a court of competent jurisdiction to be illegal or unenforceable in whole or in part, then the offending provision automatically shall be deemed modified to conform to the minimum requirements of law. The provision as modified, together with all other provisions hereof, shall be given full force and effect. |
| D. | Successors and Assigns. This Agreement will be binding upon my heirs, executors, administrators and other legal representatives and will be for the benefit of the Company, its successors, and its assigns. |
| E. | Company. The term “Company” shall include any subsidiaries, affiliates, predecessors, or successors of the Company. |
| 15. | Independent Representation |
Each party warrants and represents that (i) this Agreement has been prepared by the Company’s legal counsel, (ii) he/she has been advised to obtain the advise of personal or independent counsel in the analysis of this Agreement, and (iii) that he/she has read this Agreement with care and believes that he/she is fully aware of and understands the contents hereof and their legal effect.
| 16. | Survival of Covenants and Provisions |
The terms and obligations of Sections 4, 5 and 9 of this Agreement shall survive the termination of Employee's employment with the Company or any subsidiary of the Company, and shall survive the termination of this Agreement.
IN WITNESS WHEREOF, the parties as of the day and year first above written have executed this Agreement.
| Flux Power Inc | Xxxxx Xxxxxxx |
| By: | /s/Xxxxx Xxxxxx | By: | /s/Xxxxx Xxxxxxx | |
| Officer’s signature: | Employee’s Signature | |||
| Xxxxx Xxxxxx, Secretary | ||
| Officer’s Name & Title: (Please Print) |
| 05/24/2012 | 05/24/2012 | |
| Date: | Date: |
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