Exhibit 10.3
F Gibbard Employment Agreement
AMENDED AND RESTATED
OFFICER'S EMPLOYMENT AGREEMENT
This AMENDMENT AND RESTATED OFFICER'S EMPLOYMENT AGREEMENT (this
"Agreement"), dated as of October 1, 1999, is between H Power Corp., a Delaware
corporation, having its principal place of business at 00 Xxxxxxxxxx Xxxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000 (hereinafter referred to as the "Company"), and H.
Xxxxx Xxxxxxx, residing at 00 Xxxxxx Xxxx, Xxxxxx, Xxx Xxxxxxxxx 00000
(hereinafter referred to as "Executive"). (The Company and Executive are
collectively referred to as the "Parties.")
WHEREAS, Executive and the Company entered into an Officer's Employment
Agreement, dated as of October 7, 1996 (the "Prior Agreement"); and
WHEREAS, the Parties wish to amend and restate the provisions of the Prior
Agreement on the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants set forth in this
Agreement and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Term of Employment
Subject to the provisions of this Agreement, the Company hereby agrees to
employ Executive, and Executive hereby agrees to be employed by the Company, for
a term commencing October 1, 1999 and ending October 6, 2002.
2. Titles and Duties
Subject at all times to the supervision and direction of the Board of
Directors of the Company (the "Board"), Executive shall be employed as Chief
Executive Officer of the Company and shall have such duties, authority, rights
and obligations as are usually inherent in such position and as the Board may
reasonably require. In general, Executive shall use his very best efforts to
promote the business of the Company.
In the event that Executive is elected or appointed as a Director or the
Company or as a Director or an Officer of the Company's affiliated or subsidiary
companies, whether now existing or hereafter acquired, Executive consents to
serve in such capacity or capacities as the Board may determine, without
additional compensation.
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F Gibbard Employment Agreement
Executive shall render his services at the Company's principal place of
business or at such other place or places as the Board shall designate.
3. Exclusive Employment
Executive shall devote substantially all his business time, ability and
attention to the business of H Power. Executive shall not directly or indirectly
render any services of a business, commercial, or professional nature, to any
other person or organization, whether for compensation or otherwise, that is in
competition directly or indirectly with the business of H Power except as set
forth in paragraph (d) below.
(a) Executive shall refrain from any act which involves a conflict of
interest between the exercise of his position in the Company and his
personal interest.
(b) Executive shall refrain from exploiting any business opportunity of
the Company for the achievement of an advantage for himself or for
another.
(c) Executive shall disclose to the Company any information and deliver
to it any document that pertains to its affairs and which came into
his possession by virtue of his position with the Company.
(d) Executive is the founder and co-shareholder with Xxxxxxx Xxxxxxx,
his wife, of Gibbard Research and Development Corporation, a
Massachusetts corporation ("GRDC"), which is in the business of
developing lithium ion batteries. The Company is aware that
Executive intends to maintain his interest in GRDC and intends to
devote some minimum time to the affairs of that enterprise. The
Parties agree that, in the event the Company determines that it
would be in its best interest to acquire GRDC, the Parties will
negotiate in good faith to achieve that result.
4. Compensation & Benefits
For the full and faithful performance of his services as set forth
hereunder, Executive shall be entitled to the following:
(a) Base Salary. During the term of this Agreement, Executive shall be
paid an annual salary of Two Hundred and Three Thousand Three
Hundred Twenty
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F Gibbard Employment Agreement
Dollars ($203,320), payable in bi-weekly installments, subject to
all applicable withholding, social security and other payroll taxes.
(b) Salary Adjustments. The rate of salary shall be reviewed by the
Board not less often than annually and may be increased (but not
decreased) from time to time in such amounts as the Board in its
discretion may provide; it being understood, however, that the Board
shall have no obligation to increase said salary.
(c) Benefit Programs. Executive shall be entitled to participate in all
employee benefit programs of the Company available to senior
executives of the Company, as such programs may be in effect from
time to time, including, without limitation: pension or other
retirement plans; profit sharing plans; group life insurance;
accidental death and dismemberment insurance; hospitalization,
surgical and major medical coverage; sick leave, vacation and
holiday benefits; and other employee benefit programs sponsored by
the Company. Such programs may be amended or terminated if done so
for all or a material portion of the Company's executives.
(d) Reimbursement of Expenses. Consistent with established policies of
the Company as in effect from time to time for senior executives,
consultants and members of the Board, the Company shall pay to or
reimburse Executive for all reasonable and actual out-of-pocket
expenses, including without limitation, travel, hotel, automobile,
telephone and cellular telephone expenses, computer and data
processing expenses and similar expenses, incurred by Executive in
performing his obligations under this Agreement. During the term of
this Agreement, as may be extended, the Company shall furnish
Executive with, or shall reimburse Executive for, a vehicle (of
comparable stature to the xxxx and model of the automobile to which
Executive has been accustomed), as well as insurance costs therefor.
(e) Bonuses. In addition to all other compensation, Executive shall be
entitled to receive such bonuses as the Board shall determine, in
its sole discretion, from time to time; it being understood that the
Board shall have no obligation to award such bonuses.
5. Termination of Employment
(a) For Cause. The Company shall have the right to terminate this
Agreement immediately after written notification to Executive
specifying the basis for the termination, upon the occurrence of any
one of the following events which
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F Gibbard Employment Agreement
shall constitute "cause": (i) the willful failure by Executive to
abide by the terms of this Agreement; or (ii) fraud,
misappropriation, embezzlement, theft, dishonesty or similar actions
by Executive; or (iii) the habitual or willful neglect by Executive
or his employment duties; or (iv) the habitual or willful disregard
of Board mandates; or (v) the willful performance of an unauthorized
act outside the scope of his office; or (vi) an act of moral
turpitude by Executive which tends to reflect unfavorably on the
Company.
In the event that the Company terminates Executive's
employment for cause, Executive shall be entitled only to the unpaid
bi-weekly installments of his Base Salary up to and including the
date of termination and to his approved Business Expense
Reimbursement not paid prior to termination.
(b) In the Event of Death. This Agreement shall terminate in the event
of Executive's death, in which case Executive's estate shall be
entitled to the bi-weekly installments of Executive's Base Salary
for a period of six months following the date of death and
Executive's Business Expense Reimbursement not paid prior to his
death.
(c) In the Event of Disability. The Company shall have the right to
terminate this Agreement in the event of Executive's inability to
substantially perform his duties hereunder for a period of three
months out of any six month period during his employment, whether
such inability results from illness, accident or otherwise.
In the event that the Company terminates Executive's
employment during the term of this Agreement as a result of
Executive's Disability, Executive shall be entitled to the bi-weekly
installments of his Base Salary for a period of six months following
the date of termination; Executive's Business Expense Reimbursement
not paid prior to termination; and the continuation of Executive's
health and welfare benefits through the end of the terms of this
Agreement.
(d) Change in Control. (i) In the event that Executive's employment is
terminated by the Company within one year following a Change in
Control (as defined below) for any reason other than cause, death or
disability, then the Company shall pay Executive one-half his annual
Base Salary at his then current rate and one-half of the latest
annual incentive compensation payment calculated by taking the
highest of the latest two incentive payments earned and paid divided
by two, such payment to be made in one lump sum payment at the time
of termination. Such payments shall be in lieu of any and all other
payments due and owing to Executive under the terms of this
Agreement. The Company shall also provide to the Executive health
insurance for a
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F Gibbard Employment Agreement
period of one year following termination of Executive's employment.
Executive shall not be required to seek other employment or to
otherwise mitigate the effects of such termination, and such
payments shall not be reduced by any income received from other
sources (all compensation and other benefits described above and the
terms thereof shall hereinafter be referred to collectively as the
"Severance Package").
(ii) Executive may terminate his employment hereunder within
one year following a Change of Control for Good Reason; provided
that, (x) the Company has been given notice setting forth in
reasonable detail the nature of the Good Reason and (y) a period of
at least thirty (30) days in which the Company may remedy the
circumstances giving rise to such Good Reason has expired, and the
Company fails to so remedy such circumstances. For purposes of this
Agreement, "Good Reason" shall mean:
(A) the assignment to Executive of any duties materially
inconsistent with Executive's position, duties and
responsibilities as set forth in Section 2 of this Agreement
or any action by the Company which results in a material
diminution in Executive's position, authority, duties or
responsibilities, excluding for this purpose any isolated or
inadvertent action by the Company which is remedied by the
Company promptly after receipt of notice thereof from the
Executive; or
(B) any failure by the Company to comply in all material
respects with the provisions of Section 4 of this Agreement
regarding Executive's compensation, benefits, vacation, and
expenses other than an isolated or inadvertent action by the
Company which is remedied by the Company promptly after
receipt of notice thereof from the Executive.
In the event that Executive terminates his employment for Good
Reason following a Change in Control, then the Company shall pay
Executive the Severance Package.
For purposes of this provision, a "Change in Control" shall be
deemed to have occurred: (i) if any "person" (as such term is used
in Sections 13(d)(3) and 14(d)2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), other than Executive, who is
not a shareholder of the Company as of the date hereof, shall have
become the beneficial owner, directly or indirectly, of Common Stock
representing thirty-three and one-third percent (33 1/3%) or more of
the combined voting power of the Company's then outstanding
securities, unless three-quarters of the Board of Directors, as
constituted immediately prior to the date of the Change in Control,
decide in their reasonable discretion that no Change in Control has
occurred, the Executive not being allowed to vote on such matter if
he is then a Director;
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F Gibbard Employment Agreement
provided, however, that if any such person other than Executive
(whether or not a stockholder of the Company as of the date hereof)
shall become the beneficial owner, directly or indirectly, of Common
Stock representing fifty percent (50%) or more of the Company's then
outstanding securities, a Change in Control shall ipso facto have
occurred; or (ii) if there is a Change in Control of a nature that,
in the opinion of counsel for the Company, would be required to be
reported in response to Item 6(e) of schedule 14A under the Exchange
Act, unless three-quarters of the Board of Directors, as constituted
immediately prior to the date of the Change in Control, decide in
their reasonable discretion that no Change in Control has occurred,
Executive not being allowed to vote on such matter if he is then a
Director.
6. Unauthorized Disclosure
During the period of his employment and for a period of three (3) years
thereafter, Executive shall not, without the prior written consent of the Board,
disclose to any person other than as required by law or court order, or other
than to an employee of the Company, or to a person to whom disclosure is
necessary or appropriate in connection with the performance by Executive of his
duties as an executive of the Company, any confidential information obtained by
him while in the employ of the Company with respect to any of the Company's
products, services, customers, suppliers, marketing techniques, patents,
proprietary technologies, trade secrets, methods, or future plans, the
disclosure of which will be damaging to the Company; provided, however, that
confidential information shall not include any information known generally to
the public (other than as a result of unauthorized disclosure by Executive).
7. Restrictive Covenant
During the period of his employment and for a period of two (2) years
thereafter, Executive shall not enter into competition with the Company or any
affiliate of the Company without the prior consent of the Board. For purpose of
this paragraph 7, competition shall mean the association of Executive with a
company, corporation, firm or partnership, whether as an employee, consultant,
partner, principal, agent, representative or shareholder, directly or indirectly
(except as a holder, directly or indirectly, of less than Five (5%) Percent of
the outstanding securities of any corporation whose stock is listed for trading
on any securities exchange or are traded in the over-the-counter market) which
competes, directly or indirectly, with the Company in any business in which the
Company is presently engaged or will be engaged upon termination of Executive's
employment, unless such association shall be for purposes and shall impose
duties upon Executive that do not directly relate to the Company's business
activities. If a court of competent jurisdiction should determine that the
period, scope, or geographical area of the restrictions set forth in this
paragraph 7 are unreasonable under the circumstances then existing, the Parties
agree that the period, scope, or geographical area that is reasonable under such
circumstances shall be substituted for the stated period, scope, or geographical
area.
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F Gibbard Employment Agreement
During the term of his employment and for a period of two (2) years
thereafter, Executive shall neither solicit, induce and/or suggest to any of the
employees, consultants to, or other persons having a substantial contractual
relation with, the Company to leave such employ, cease counseling or terminate
such contractual relationship with the Company nor to join Executive as a
partner, co-venturer, employee, investor, or otherwise, in any substantial
business activity whatsoever.
Executive shall at no time take any action or make any statement that
could discredit the reputation of the Company or its personnel, products or
services.
8. Inventions or Discoveries
Executive shall fully and promptly disclose to the Company any and all
improvements, discoveries, and inventions made or conceived by him, whether or
not patentable, whether or not during the working hours of his employment or
with the use of the Company's facilities, materials or personnel, and whether
solely or jointly with others, during his employment by the Company, which
result from or relate to the business of the Company in any way.
Any and all such improvements, discoveries, and inventions are and shall
remain the sole and exclusive property of the Company without royalty or payment
of any further consideration to Executive, on his own behalf and on the behalf
of his heirs, assigns, executors, administrators, and any other legal
representative, except those inventions relating to lithium ion batteries
developed by Executive for GRDC. Inventions relating to lithium ion batteries
developed by Executive for GRDC shall be and remain the property of GRDC.
Executive hereby assigns and transfers all of his right, title and interest in
and to all such improvements, discoveries, and inventions (except as heretofore
noted) to the Company, including, but not limited to, any applications for
United States and/or foreign letter patents and any United States and/or foreign
patents that shall be granted. Executive shall apply, at the Company's request
and expense, for United States and foreign letters patent, whether in his name
or otherwise as the Company shall desire, and shall execute and deliver to the
Company without charge to the Company, but at its expense, such written
instruments and shall do such other acts as may be necessary or appropriate in
the opinion of the Company to obtain and maintain United States and/or foreign
letters patent or proprietary rights and shall vest the entire right entitled
thereto in the Company.
9. Equitable Relief
Executive hereby represents that the services to be performed by him are
of a special, unique, unusual, extraordinary and intellectual character which
gives them a peculiar value, the loss of which cannot be reasonably or
adequately compensated in damages in an action at law and that any violation of
this Agreement will cause the Company immediate and irreparable harm. Executive
therefore expressly agrees that, in addition to any other rights or remedies
which the Company may possess,
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F Gibbard Employment Agreement
the Company shall be entitled to injunctive and other equitable relief to
prevent a breach of this contract by the Company.
10. Indemnification
Executive shall indemnify and save harmless the Company from all liability
from loss, damage or injury to persons or property resulting from the gross
negligence or willful misconduct of Executive.
11. Disputes
Any controversy or claim arising out of or relating to this Agreement, or
any breach thereof, shall be settled by arbitration in accordance with the rules
of the American Arbitration Association then in effect in the State of New
Jersey, and judgment upon such award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof. The arbitration shall be held
in Newark, New Jersey or any other location mutually agreed upon by the Parties.
Each party shall bear its or his own cost of the arbitration. Executive's salary
and benefits shall continue during the period his claim is being arbitrated;
provided, however, that the Company shall not be obligated to make such payment
or provide such benefits after the end of the term of this Agreement and that
the Company may recover the cost of such payments should the arbitrator(s)
decide that Executive was not entitled to such payments.
12. Assignability
No rights or obligations under this Agreement may be assigned or
transferred by Executive except:
(a) Executive's rights to compensation and benefits hereunder shall, in
the event of death, pass to his estate, or to his designated
beneficiary and may be transferred by will or operation of law, and
(b) Executive's rights under the Company's plans, programs and policies
may be assigned or transferred in accordance with the terms of such
plans, programs and policies.
The rights and obligations of the Company under this Agreement shall inure
to the benefit of and shall be binding upon the successors and assigns of the
Company. The Company shall have the right to assign this Agreement to a
successor in the event of a merger, consolidation, sale of a substantial portion
of its assets or a similar transaction.
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F Gibbard Employment Agreement
13. Governing Law
This Agreement shall be governed by the laws of the State of New Jersey
without reference to the principles of conflict of laws.
14. Entire Agreement
Except as otherwise specifically provided herein, this Agreement contains
all the legally binding understandings and representations between the Company
and Executive pertaining to the subject matter hereof and supersedes all
undertakings and agreements, if any, whether oral or in writing, previously
entered into by the Company and Executive with respect to such subject matter.
15. Amendment or Modification; Waiver
No provision of this Agreement may be amended or waived unless such
amendment or waiver is approved by the Board and is signed by Executive and by a
duly authorized officer of the Company. Except as otherwise specifically
provided in this Agreement, no waiver by the Company or Executive of any breach
by the other of any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of a similar or dissimilar provision
or condition at the same or any prior or subsequent time.
16. Notices
Any notice required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been given when delivered personally or
sent by certified or registered mail, postage prepaid, return receipt requested,
duly addressed to the party concerned at the address indicated below or to such
changed address as such party may subsequently give notice of:
If to H Power: H Power Corp.
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn.: Secretary
If to Executive: H Xxxxx Xxxxxxx
00 Xxxxxx Xxxx
Xxxxxx, Xxx Xxxxxxxxx 00000
17. Severability
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F Gibbard Employment Agreement
In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, the remaining
provisions or portions of this Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted by law.
18. Survivorship
To the extent contemplated by this Agreement, the respective rights and
obligations of the Parties hereunder shall survive any termination of this
Agreement to the extent necessary to the intended preservation of such rights
and obligations.
19. Representations
(a) By the Executive. Executive represents and warrants that the
performance of his duties under this Agreement will not violate any
agreement between him and any other person, firm or organization.
(b) By the Company. The Company represents and warrants that it is fully
authorized and empowered to enter into this Agreement.
20. References
In the event of Executive's death or a judicial determination of his
incompetence, reference in this Agreement to Executive will be deemed, where
appropriate, to refer to his legal representative or, where appropriate, to his
beneficiary or beneficiaries.
Headings to the sections in this agreement are intended solely for
convenience and no provision of this Agreement shall be construed by reference
to any heading.
21. Mutual Intent
The language used in this Agreement is the language chosen by the Parties
to express their mutual intent. The Parties agree that in the event that any
language, section, clause, phrase or word used in this Agreement is determined
to be ambiguous, no presumption shall arise against or in favor of either party
and that no rule of strict construction shall be applied against either party.
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F Gibbard Employment Agreement
IN WITNESS WHEREOF, Executive and the Company have caused this Agreement
to be executed as of the day and year first above written.
EXECUTIVE H POWER CORP.
/s/ H. Xxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxx
-------------------------- -------------------
H. Xxxxx Xxxxxxx Xxxxxxx X. Xxxx
Chief Financial Officer
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