EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of the
12th day of April, 1996, by and between KENETECH Windpower, Inc., a Delaware
corporation (the "Company"), and Xxxxxx X. Xxxx, an individual currently
employed by the Company (the "Employee" or "you").
RECITALS
A. The Employee is assuming new responsibilities as an executive officer of
the Company.
B. The Company and the Employee desire to enter into a written employment
agreement on the terms set forth below.
NOW THEREFORE, in consideration of the mutual promises contained herein,
and for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties agree as follows:
AGREEMENT
1. Employment. Unless terminated in connection with a Termination For
Cause (as defined below), the Employee is and will continue to be employed by
the Company at an annual base salary of $200,000 and with the same employee
benefits applicable as of the date of this Agreement.
2. Employment Duties. The Company will employ you as President of the
Company. You agree to perform in good faith and to the best of your ability all
services which may be required of you in your executive position and to be
available to render such services at all reasonable times and places in
accordance with reasonable directives and assignments issued by the Company's
Chief Executive Officer and the Board of Directors. During your employment, you
will devote your full time and effort to the business and affairs of the Company
within the scope of your executive office.
3. Benefits.
3.1 Termination. The Company and you have agreed that if your
employment with the Company is terminated for any reason (other than a
Termination For Cause), (a) you will receive severance payments equal to your
base salary for a period of one (1) year from and after the effective date of
your termination, and (b) you and your eligible dependents will continue to
receive the Company's health care coverage and life insurance (on the same terms
as you had while an employee) for one year after the date of termination.
3.2 Bonus Payments.
(a) The Company will pay to you a bonus in the amount of $66,000
on May 15, 1996.
(b) The Company will pay to you a bonus in the amount of
$134,000 on December 31, 1996. The payments described in
Sections 3.2 (a) and (b) shall be referred to as the "Bonus
Payments".
3.3 Termination For Cause. If you commit one or more acts of fraud,
embezzlement, misappropriation of property or information or engage in any other
conduct materially adversely affecting the business reputation of the Company,
you may be terminated for cause (a "Termination For Cause") and you will not be
paid any of the payments or benefits described in this Agreement.
3.4 Change in Control. Upon a Change In Control, the Company will
pay you a lump sum amount equal to one year's base salary. For purposes of this
Agreement, "Change in Control" means:
(i) a merger or acquisition in which the Company is not the
surviving entity, except for a transaction the
principal purpose of which is to change the State of
the Company's incorporation;
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Company in
liquidation or dissolution of the Company;
(iii)any reverse merger in which the Company is the
surviving entity, but in which fifty percent (50%) or
more of the Company's outstanding voting stock is
transferred to holders different from those who held
the stock immediately prior to such merger; or
(iv) the acquisition of more than fifty percent (50%) of the
Company's outstanding voting stock pursuant to a tender
or exchange offer made by a person or related group of
persons (other than the Company or a person that
directly or indirectly controls, is controlled by or is
under common control with the Company).
3.5 Withholding. The Company will deduct and withhold, from the
compensation payable to you under this Agreement, any and all Federal, State and
local income and employment withholding taxes and any other amounts required to
be deducted or withheld by the Company under the applicable statute or
regulation.
4. Death. Upon your death during employment, the employment relationship
created pursuant to this Agreement will immediately terminate, and no further
compensation will become payable to you hereunder. In connection with such
termination, the Company will only be required to pay you (or your estate) any
unpaid compensation earned for services rendered through the date of your death.
5. Restrictive Covenant. During your employment:
(i) You will devote your full working time and effort to
the performance of your duties as an executive officer
of the Company; and
(ii) You will not directly or indirectly, whether for your
own account or as an employee, consultant or advisor,
provide services to any business enterprise other than
the Company, unless otherwise authorized by the Company
in writing.
However, you will have the right to perform such incidental services as
are necessary in connection with (a) your private passive investments, (b) your
charitable or community activities, and (c) your participation in trade or
professional organizations, but only to the extent such incidental services do
not interfere with the performance of your services hereunder.
6. Confidentiality. You hereby acknowledge that the Company may, from time
to time during your employment, disclose to you confidential information
pertaining to the Company's business and affairs and client base, including
(without limitation) customer lists and accounts, other similar items indicating
the source of the Company's income, and information pertaining to the salaries
and performance levels of the Company's employees. You will not, at any time
during or after such employment, disclose to any third party or directly or
indirectly make use of any such confidential information, including (without
limitation) the names, addresses and telephone numbers of the Company's
customers, other than in connection with, and in furtherance of, the Company's
business and affairs. All documents and data (whether written, printed or
otherwise reproduced or recorded) containing or relating to any such proprietary
information of the Company which come into your possession during your
employment will be returned by you to the Company immediately upon the
termination of your employment or upon any earlier request by the Company, and
you will not retain any copies, notes or excerpts thereof. Your obligations
under this Section 6 will continue in effect after termination of your
employment with the Company, whatever the reason or reasons for such
termination, and the Company will have the right to communicate with any of your
future or prospective employers concerning your continuing obligations under
this Section 6.
7. Ownership Rights. All materials, ideas, discoveries and inventions
pertaining to the Company's business, including (without limitation) all patents
and copyrights, patent applications, patent renewals and extensions, and the
names, addresses and telephone numbers of customers, will belong solely to the
Company. You will continue to be bound by all the terms and provisions of your
existing Proprietary Information and Inventions Agreements with the Company or
its subsidiaries or affiliated companies, and nothing in this document will be
deemed to modify or affect your duties and obligations under those other
agreements.
8. Indemnification. The indemnification provisions for Officers and
Directors under the Company's Bylaws will (to the maximum extent permitted by
law) be extended to you, during your employment and the period following your
termination irrespective of a Change in Control, with respect to any and all
matters, events or transactions occurring or effected during your employment.
9. Miscellaneous. The provisions of this Agreement will be binding upon
the Company, its successors and assigns (including, without limitation, the
surviving entity or successor party resulting from a Change in Control) and will
be construed and interpreted under the laws of the State of California. Each of
the parties acknowledges and agrees that upon any breach of this Agreement by
you, the Company will not have an adequate remedy at law, and will be entitled
to specific performance and other equitable relief. This Agreement incorporates
the entire agreement between you and the Company relating to the terms of your
employment and supersedes all prior agreements and understandings with respect
thereto. This Agreement may only be amended by written instrument signed by you
and an authorized officer of the Company. The provisions of this Agreement will
be deemed severable, and if any part of any provision is held illegal, void, or
invalid under applicable law, the remaining provisions of the Agreement will not
in any way be affected or impaired, but will remain binding in accordance with
their terms.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date first written above.
KENETECH CORPORATION, a Delaware corporation
By___________________________
Name: Xxxx X. Xxxxxx
Title: President and Chief Executive Officer
XXXXXX X. XXXX
