Exhibit 10.1
EMPLOYMENT AGREEMENT
Xxxx Xxxx
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and
entered into as of the 30th day of October, 2004 (the "Effective Date"), by and
between Power Technology, INC., a Nevada corporation ("Employer"), and Xxxx
Xxxx, an individual residing in Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx
("Executive").
W I T N E S S E T H:
WHEREAS, Employer and Executive desire to enter into an
agreement regarding Executive's employment with Employer pursuant to the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, and intending to be
legally bound hereby, the parties covenant and agree as follows:
1. Employment. Employer hereby employs Executive and Executive
hereby accepts employment with Employer on the terms and conditions set forth in
this Agreement.
2. Term of Employment. The term of Executive's employment
hereunder (the "Term") shall commence as of 22 day of November, 2004 (the
"Commencement Date") and shall continue (subject to extension and termination by
either Employer or Executive, all as hereinafter provided) for an initial term
(the "Initial Term") expiring on 21 day of November, 2006 (the "Expiration
Date"). The Expiration Date shall, unless terminated by Employer or Executive,
be automatically extended for successive one (1)-year periods following the
expiration of the Initial Term. If Employer desires to terminate Executive's
employment under this Agreement at the end of the Initial Term or at the end of
any succeeding one (1)-year term, Employer shall give written notice of such
desire to Executive at least ninety (90) days prior to the expiration of the
Initial Term or any succeeding one (1)-year term. If Executive desires to
terminate Executive's employment under this Agreement at the end of the Initial
Term or at the end of any succeeding one (1)-year term, Executive shall give
written notice of such desire to Employer at least ninety (90) days prior to the
expiration of the Initial Term or any succeeding one (1)-year term. At the
expiration of the then-existing term, Employer shall have no further obligation
to Executive other than payment of any earned and unpaid Base Salary (as
hereafter defined) under Section 3.a. and any earned and unpaid Bonus (as
hereafter defined) under Section 3.b., and Executive shall have no further
obligation to Employer except as set forth in Sections 8, 9, 10 and 11.
3. Compensation and Other Benefits.
a. As compensation for all services rendered by
Executive in performance of Executive's duties or obligations under this
Agreement, Employer shall pay Executive the following base salary (the "Base
Salary"):
86,250 Canadian Dollars per year through 21 day of November 2005,
Increasing to 97,750 Canadian Dollars per year from 22 day of
November 2005, to 21 day of November 2006, increasing in each
subsequent year by no less than 10% of Base Salary or such greater
amount as set by the Compensation Committee.
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Executive's Base Salary shall be payable in equal semi-monthly installments or
in the manner and on the timetable which Employer's payroll is customarily
handled or at such intervals as Employer and Executive may hereafter agree to
from time to time.
b. Upon the execution of this agreement, Executive
shall be entitled to a stock option to acquire 100,000 shares of the Employer's
common stock at a price of one half of one cent, $.005 U.S. Dollars, pursuant to
the terms of the Company's 2004-B Stock Option, SAR, and Stock Bonus Plan (the
"Plan"). Executive shall also be entitled stock options to acquire an additional
900,000 shares of the Employer's common stock at a price of one half of one
cent, $.005 U.S. Dollars, pursuant to the terms of the Company's 2004-B Stock
Option, SAR, and Stock Bonus Plan (the "Plan Stock options for 450,000 of these
additional shares shall vest upon the earlier of two years from the Commencement
Date or the manufacturing and delivery of 100 prototype 12 Volt batteries. Stock
options for the other 450,000 additional shares shall vest upon the earlier of
two years from the Commencement Date or the completion of the design and
fabrication of the equipment necessary to manufacture the 12 Volt battery in
commercial quantities.
c. Executive shall be entitled to be reimbursed by
Employer for all reasonable and necessary expenses incurred by Executive in
carrying out Executive's duties under this Agreement in accordance with
Employer's standard policies regarding such reimbursements. The Employer should
pay expenses by Executive in no later than 10 days after receiving the expense
claims.
d. Employer shall pay, for Executive's benefit, the
premiums required by Canadian law or the basic medical and health benefits (MSP)
and work compensation board (WCB) insurance.
e. During each twelve (12) month period of this
Agreement, Executive shall be entitled to three (3) weeks of paid vacation,
increasing to four (4) weeks after five years of service. In addition, Executive
shall be entitled to receive paid holidays as enjoyed by all other employees of
Employer.
4. Duties.
a. Executive is employed to act as Chief Technology
Officer and Vice President of Employer, and to perform the duties and functions
that are normal and customary to such position. Employer shall establish an
office and laboratory for Executive's use in the metropolitan Vancouver, British
Columbia metropolitan area.
b. Executive agrees that during the period of
employment, Executive shall devote full-time efforts to Executive's duties as an
employee of Employer and Executive shall use Executive's best efforts to perform
the duties of Executive's position in an efficient and competent manner and
shall use Executive's best efforts to promote the interests of Employer and any
affiliated companies.
c. During the period of employment, Executive agrees
not to (i) solely or jointly with others undertake or join any planning for or
organization of any business activity related to technology competitive with the
business activities of Employer, and (ii) directly or indirectly, engage or
participate in any other activities related to technology in conflict with the
best interests of Employer. The Employer agrees Executive may consult other
companies with business outside the field of lead-acid battery technology if the
other business is not in competition with Employer and if such consulting
activities do not interfere with the performance by Executive of his duties to
Employer.
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d. Executive agrees that during the period of
employment Executive shall refer to Employer all opportunities to which
Executive might become exposed in carrying out Executive's duties and
responsibilities hereunder that relate to the Employer's business.
5. Termination of Employment. Executive's employment and this
Agreement shall terminate upon the earliest to occur of any of the following
events (the actual date of such termination being referred to herein as the
"Termination Date"):
a. The expiration of the Agreement pursuant to
Section 2.
b. Employer may terminate Executive's employment and
this Agreement for Cause (as defined below), provided, however, that Employer
may not terminate Executive's employment for Cause unless:
(1) No fewer than sixty (60) days prior to
the date of termination (the actual date of such termination
being referred to herein as "Date of Termination"), the
Employer provides Executive with written notice (the "Notice
of Consideration") of Employer's intent to consider
termination of Executive's employment for Cause, which notice
shall include a detailed description of the specific reasons
which form the basis for such consideration, and shall specify
a date and time for Executive to appear before the Company's
Board of Directors to present arguments and evidence on
Executive's own behalf with respect to the reasons for
consideration identified in the Notice of Consideration (which
date shall not be less than thirty (30) days after the date
the Notice of Consideration is provided by Employer to
Executive) (the "Consideration Date");
(2) Executive shall have the opportunity to
appear before the Company's Board of Directors on the
Consideration Date, with or without legal representation, at
Executive's election, to present such arguments and evidence
on Executive's own behalf with respect to such reasons for
consideration; and
(3) Following the presentation to the
Company's Board of Directors as provided in Section 5.b.(2)
above or Executive's failure to appear before the Board of
Directors on the Consideration Date, Executive may be
terminated for Cause only if (x) the Company's Board of
Directors, by the affirmative vote of two-thirds (2/3) of the
members of a quorum of the Board of Directors present at such
meeting (excluding Executive if Executive is then a member of
the Board of Directors, and any other member of the Board of
Directors reasonably believed by the Board of Directors to be
involved in the events leading the Board of Directors to
terminate Executive for Cause), determines that the actions or
inactions of Executive specified in the Notice of Termination
occurred, that such actions or inactions constitute Cause; and
(y) the Company's Board of Directors provides Executive with a
written determination (a "Notice of Termination for Cause")
setting forth in specific detail the basis of such Termination
of Employment, which Notice of Termination for Cause shall be
consistent with the reasons set forth in the Notice of
Consideration. Unless the Employer establishes both (i) its
full compliance with the substantive and procedural
requirements of this Section 5.b. prior to a termination of
employment for Cause, and (ii) that Executive's action or
inaction specified in the Notice of Termination for Cause did
occur and constituted Cause, any termination of employment
shall be deemed a termination by Employer without Cause for
all purposes of this Agreement.
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(4) After providing a Notice of
Consideration pursuant to the provisions of Section 5.b.(1),
the Employer's Board of Directors may, by the affirmative vote
of two-thirds (2/3) of the members of a quorum of the Board of
Directors present at such meeting (excluding for this purpose
Executive if he is a member of the Board of Directors, and any
other member of the Board of Directors reasonably believed by
the Board of Directors to be involved in the events issuing
the Notice of Consideration), suspend Executive with pay until
a final determination pursuant to this Section 5.b. has been
made.
(5) After receiving a Notice of
Consideration pursuant to the provisions of Section 5.b.(1),
Executive may terminate this Agreement without Good Reason
with thirty (30) days prior written notice.
(6) If Executive's employment is terminated
under this Section 5.b., Executive shall be entitled to
receive accrued but unpaid compensation set forth in Section
3.a. and Section 3.b. hereof through the Termination Date and
those benefits under Section 3.d. which are required under the
Employee Income Retirement Security Act of 1974, as amended
("ERISA"), or other applicable laws.
c. In the event of Executive's death or disability of
a permanent nature rendering the Executive unable to perform Executive's duties
hereunder for a period of not less than ninety (90) days during any one hundred
eighty (180) consecutive day period during the Term hereof, Employer shall pay
to the Executive or the estate of the Executive, as applicable, in the year of
death or disability, compensation which would otherwise be payable to the
Executive pursuant to Section 3 hereof up to (i) the end of the one hundred
eighty (180) day period following death, or (ii) the expiration of the one
hundred eighty (180) day period referred to above during which time the
Executive was unable to perform Executive's duties hereunder to the extent
described above.
(1) The Term of employment shall end upon
the Executive's death or the expiration of such one hundred
eighty (180) day period and a determination by the Employer's
Board of Directors of Employer that there is no reasonable
accommodation (within the meaning of the Americans with
Disabilities Act) which would enable Executive to perform the
essential functions of Executive's position under this
Agreement despite the existence of such disability.
(2) For purposes of this Agreement,
Executive shall be deemed to be unable to perform Executive's
duties hereunder when the Board of Directors of Employer, upon
the advice of a qualified physician mutually agreeable to the
Executive (or, if appropriate, Executive's representative) and
the Board of Directors of Employer, shall have determined that
Executive has become physically or mentally incapable
(excluding infrequent and temporary absences due to ordinary
illness) of performing Executive's duties under this
Agreement.
(3) Before making any termination decision
pursuant to this Section 5.c., the Board of Directors of
Employer shall determine whether there is any reasonable
accommodation (within the meaning of the Americans with
Disabilities Act) which would enable Executive to perform the
essential functions of Executive's position under this
Agreement despite the existence of any such disability. If
such a reasonable accommodation is possible, Employer shall
make that accommodation and shall not terminate Executive's
employment hereunder based on such disability.
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d. The Employer may terminate the Executive's
employment without Cause with thirty (30) days prior written notice. In that
event, the Employer shall:
(1) Pay the Executive six months of Base
Salary, and as of the Termination Date, all accrued but unpaid
compensation due under Section 3.a. and Section 3.b.
e. As used in this Agreement, "Cause" shall
mean:
(1) Any embezzlement or wrongful diversion
of funds of Employer or any affiliate of Employer by
Executive;
(2) Gross malfeasance by Executive in the
conduct of Executive's duties;
(3) Material breach of this Agreement and
the failure to cure such breach; or
(4) Gross neglect by Executive in carrying
out Executive's duties.
6. Inventions and Creations Belong to Employer.
With respect to any and all inventions, discoveries, conceptions,
ideas and/or improvements created, conceived or developed by Employee (whether
alone or in combination with others) at any time during his or her employment by
Company with respect to any field in which Company has operated or in which
Company is likely to operate in the future (the "Inventions"):
A. Employee agrees to promptly disclose the details of any such
Inventions to an authorized representative of Company and provide such
representative with all information in Employee's possession relative thereto
including all possible patent applications for such Inventions;
B. All such Inventions, whether or not patented or patentable, shall be
deemed the sole and exclusive property of Company, and Employee agrees to
execute any and all documents which Company deems necessary to transfer or
assign such rights to Company;
C. Employee agrees, at no cost to Company, to execute any and all
documents which Company deems necessary to obtain, maintain and/or enforce its
rights in such Inventions including, but not limited to, any patent applications
which Company elects to file in all countries in the world and, at no cost to
Company, to fully cooperate with Company in the obtaining, maintaining and
enforcement of any intellectual property protection sought or obtained for such
Inventions, including providing any testimony required to obtain, maintain
and/or enforce such rights; and
D. Employee will not file any patent applications relating to such
Inventions without first obtaining an express release from a duly authorized
representative of Company.
7. Confidentiality; Ownership of Information. A.
"Confidential Information" shall mean any confidential technical data, trade
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secret, know-how or other confidential information disclosed to Employee in
writing, orally, or by drawing or other form or developed by Employee in the
course of and
B. Notwithstanding the foregoing, Confidential Information shall not
include information which: (i) is rightfully received from a third party
without restriction on disclosure; (ii) is furnished to any third party by
the Company without restriction on its disclosure; (iii) is approved for
release upon a prior written consent of the Company; (iv) is disclosed
pursuant to judicial order, requirement of a governmental agency or by
operation of law.
C. The Executive agrees that it will not disclose any Confidential
Information to any third party and will not use Confidential Information of
the Company for any purpose other than for the performance of the rights
and obligations of Executive's employment during the term of employment or
thereafter, without the prior written consent of the Company. Executive
further agrees that Confidential Information shall remain the sole property
of the Company and that it will take all reasonable precautions to prevent
any unauthorized disclosure of Confidential Information. No license shall
be granted by the Company to Executive with respect to Confidential
Information disclosed hereunder unless otherwise expressly provided herein.
D. Upon the request of the Company, Executive will promptly return all
Confidential information furnished hereunder and all copies thereof.
E. If Executive breaches any of its obligations with respect to
confidentiality and unauthorized use of Confidential information hereunder,
Company shall be entitled to equitable relief to protect its interest
therein, including but not limited to injunctive relief, as well as money
damages notwithstanding anything to the contrary contained herein.
8. Noncompete; Working for Competitor. In consideration of
Executive's employment by Employer, Executive will not, at any time During the
Term and for a period of twenty four (24) months after the date of termination
of employment, directly or indirectly, for Executive's own account or on behalf
of any direct competitors of Employer, engage in any business related to
lead-acid batteries or the Employer's patented pipeline connection technology or
the Employer's patented alloy sensor technology (whether as an employee,
employer, independent contractor, consultant, agent, principal, partner,
stockholder, corporate officer, director or in any other individual or
representative capacity), without the prior written consent of Employer, which
consent may be withheld by Employer in Employer's reasonable discretion.
9. Non-Solicitation of Employees. During the Term and for a
period of twelve (12) months after the date of termination of employment,
Executive will not in any way, directly or indirectly (i) induce or attempt to
induce any employee of Employer to quit employment with Employer; (ii) otherwise
interfere with or disrupt Employer's relationship with its employees; (iii)
solicit, entice or hire away any employee of Employer; or (iv) hire or engage
any employee of Employer or any former employee of Employer whose employment
with Employer ceased less than one year before the date of such hiring or
engagement. Executive acknowledges that any attempt on the part of Executive to
induce others to leave Employer's employ, or any effort by Executive to
interfere with Employer's relationship with its other employees would be harmful
and damaging to Employer.
10. Remedies; Injunction. In the event of a breach or
threatened breach by Executive of any of the provisions of this Agreement,
Executive agrees that Employer, in addition to and not in limitation of any
other rights, remedies or damages available to Employer at law or in equity,
shall be entitled to a permanent injunction without the necessity of proving
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actual monetary loss in order to prevent or restrain any such breach by
Executive or by Executive's partners, agents, representatives, servants,
employees and/or any and all persons directly or indirectly acting for or with
Executive. It is expressly understood between the parties that this injunctive
or other equitable relief shall not be Employer's exclusive remedy for any
breach of this Agreement, and Employer shall be entitled to seek any other
relief or remedy which it may have by contract, statute, law or otherwise for
any breach hereof.
11. Arbitration. The parties agree that all disputes or
questions arising in connection with this Agreement and/or the termination of
Executive's employment hereunder shall be settled by a single arbitrator
pursuant to the rules of the American Arbitration Association in the City of
Houston, Texas, and the award of the arbitrators shall be final, non-appealable,
conclusive and enforceable in a court of competent jurisdiction; provided,
however, notwithstanding the foregoing, in no event shall any dispute, claim or
disagreement arising under Sections 6, 7, 8, and 9 of this Agreement that
requires injunctive or other equitable relief be required to be submitted to
arbitration pursuant to this provision or otherwise.
12. Expenses. The Employer shall promptly pay or reimburse
Executive for all costs and expenses, including, without limitation, court costs
and attorneys' fees, incurred by Executive as a result of any claim, action or
proceeding (including, without limitation, a claim, action or proceeding by
Executive against the Employer) arising out of, or challenging the validity or
enforceability of, this Agreement or any provision hereof. The Employer shall
pay all the expense, supplies, and operating cost regarding the establishment of
an office and laboratory foe Executive's use in metropolitan Vancouver, British
Columbia, Canada.
13 Notices. Any notice, demand or request which may be
permitted, required or desired to be given in connection therewith shall be
given in writing and directed to Employer and Executive as follows:
If to Employer, at: 0000 Xx. Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chairman of the Board
Facsimile No.: (000) 000-0000
xxxxxxx@xxxxxxxxxxx.xxx
or, if to Executive, at: Xx. Xxxx Xxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, X.X.
X0X 0X0
XXXXXX
xxxxxx@xxxxx.xxx
Notices shall be deemed properly delivered and received when and if either: (i)
personally delivered; (ii) delivered by nationally-recognized overnight courier;
(iii) when deposited in the Mail, by registered or certified mail, return
receipt requested, postage prepaid; (iv) sent via internet e mail with a
confirmation of receipt. Any party may change its notice address for purposes
hereof to any address within the continental United States by giving written
notice of such change to the other parties hereto at least fifteen days prior to
the intended effective date of such change.
14. Severability. If any provision of this Agreement is
rendered or declared illegal or unenforceable by reason of any existing or
subsequently enacted legislation or by decree of a court of last resort,
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Employer and Executive shall promptly meet and negotiate substitute provisions
for those rendered or declared illegal or unenforceable, but all the remaining
provisions of this Agreement shall remain in full force and effect.
15. Assignment. This Agreement may not be assigned by any
party without the prior written consent of the other parties.
16. Binding Agreement. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto, and their respective legal
representatives, heirs, successors and permitted assigns.
17. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Nevada.
18. Agreement Read, Understood and Fair. Executive and
Employer have carefully read and considered all provisions of this Agreement and
agree that all of the restrictions set forth are fair and reasonable and are
reasonably required for the protection of their respective interests.
19. Subject to Board Approval. This Agreement is subject to
approval of the Board of Directors of Employer. In connection therewith,
Employer agrees to submit a unanimous written consent of the Board of Directors
approving such agreement on or before November 2, 2004, and to advise Executive
promptly following such meeting as to whether this Agreement was approved. In
the event this Agreement is not approved on or before such date, this Agreement
shall be void and of no further force or effect. The parties agree that this
Agreement shall be of no force and effect unless and until it has been approved
by the Board and executed by both parties.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the 30th
day of 2004, effective as of the Effective Date.
EMPLOYER:
Power Technologies, Inc.
By:
-----------------------------
Xxxxxxx X Xxxxxx - President
EXECUTIVE:
---------------------------------
Xxxx Xxxx
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