Nevada
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000-55152
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46-1845946
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(State or Other Jurisdiction of Incorporation or Organization)
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(Commission File Number)
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(IRS Employer Identification No.)
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ZNERGY, INC.
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Date: May 19, 2017
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By:
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/s/ Christopher J. Floyd
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Christopher J. Floyd
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Chief Financial Officer
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1.
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EMPLOYMENT TERMS AND DUTIES
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2.
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COMPENSATION
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2.1
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Compensation.
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(a)
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Salary and Bonuses.
The Executive’s cash compensation shall be provided by the Company pursuant to
Exhibit A
attached hereto, subject to annual review and adjustment by the Board.
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(b)
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Equity Grant
. The Executive will be granted equity in the Company as listed on
Exhibit B
attached hereto (the “Equity Grant”). Following a Company Change of Control Transaction (as hereinafter defined), all unvested options under the Equity Grant shall vest upon the closing of the Change of Control Transaction. Such shares will be issued in a transaction that is exempt from the registration requirements of the Securities Act of 1933, as amended, and such shares shall be, upon issuance, validly issued, fully paid, and non-assessable. The certificates representing said shares shall bear the Company’s standard restrictive legend.
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(c)
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Benefits.
The Executive will, during the Employment Period, be permitted to participate in such pension, profit sharing, bonus, life insurance, hospitalization, major medical or health plan, and other employee benefit plans of the Employer that may be in effect from time to time, to the extent the Executive is eligible under the terms of those plans (collectively, the “Benefits”).
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3.
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FACILITIES AND EXPENSES
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4.
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VACATIONS AND HOLIDAYS
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5.
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TERMINATION
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(a)
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upon the death of the Executive;
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(b)
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upon the disability of the Executive (as defined in Section 5.2) immediately upon notice from either party to the other;
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(c)
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upon dismissal For Cause (as defined in Section 5.3), immediately upon notice from the Employer to the Executive, or at such later time as such notice may specify; or
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(d)
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upon notice For Good Reason (as defined in Section 5.4) upon not less than thirty days’ prior notice from the Executive to the Employer.
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(a)
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Termination upon Death.
If this Agreement is terminated because of the Executive’s death, the Executive will be entitled to receive his Salary through the end of the calendar month in which his death occurs, and that part of the Executive’s Incentive Compensation, if any, for the Fiscal Year during which his death occurs, prorated through the end of the calendar month during which his death occurs.
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(b)
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Termination upon Disability.
If this Agreement is terminated by either party as a result of the Executive’s disability, as determined under Section 5.2, the Employer will pay the Executive his Salary through the remainder of the calendar month during which such termination is effective and for the lesser of (i) six consecutive months thereafter, or (ii) the period until disability insurance benefits commence under the disability insurance coverage furnished by the Employer to the Executive.
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(c)
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Termination by the Employer For Cause.
If the Employer terminates this Agreement For Cause, the Executive will be entitled to receive his Salary only through the date such termination is effective, but will not be entitled to any further Compensation for the Fiscal Year during which such termination occurs or any subsequent Fiscal Year.
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(d)
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Termination by the Executive For Good Reason or by the Employer without Cause.
If the Executive terminates this Agreement For Good Reason, or if the Employer terminates the Employee without Cause, the Employer will pay the Executive (i) the Executive’s Salary for the remainder, if any, of the calendar month in which such termination is effective and for twelve (12) consecutive calendar months thereafter, and (ii) the Executive’s Bonuses, if any, for the Fiscal Year during which the termination is effective, prorated through the date of termination and for a period of six (6) months thereafter.
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(e)
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Benefits.
The Executive’s accrual of, or participation in plans providing for, the Benefits will cease at the effective date of the termination of this Agreement, and the Executive will be entitled to accrued Benefits pursuant to such plans only as provided in such plans. The Executive will not receive, as part of his termination pay pursuant to this Section 5, any payment or other compensation for any vacation, holiday, sick leave, or other leave unused on the date the notice of termination is given under this Agreement.
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6.
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NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS
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(a)
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Confidentiality.
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(i)
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During and at all times following the Employment Period, the Executive will hold in confidence the Confidential Information and will not disclose it to any person except with the specific prior written consent of the Employer or except as otherwise expressly permitted by the terms of this Agreement.
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(ii)
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Any trade secrets of the Employer will be entitled to all of the protections and benefits under applicable state or federal law including trade secret law. If any information that the Employer deems to be a trade secret is found by a court of competent jurisdiction not to be a trade secret for purposes of this Agreement, such information will, nevertheless, be considered Confidential Information for purposes of this Agreement. The Executive hereby waives any requirement that the Employer submit proof of the economic value of any trade secret or post a bond or other security.
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(iii)
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None of the foregoing obligations and restrictions applies to any part of the Confidential Information that the Executive demonstrates was or became generally available to the public other than as a result of a disclosure by the Executive.
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(iv)
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The Executive will not remove from the Employer’s premises (except to the extent such removal is for purposes of the performance of the Executive’s duties at home or while traveling, or except as otherwise specifically authorized by the Employer) any document, record, notebook, plan, model, component, device, data, or computer software or code, whether embodied in a disk or in any other form (collectively, the “Proprietary Items”). The Executive recognizes that, as between the Employer and the Executive, all of the Proprietary Items, whether or not developed by the Executive, are the exclusive property of the Employer. Upon termination of this Agreement by either party, or upon the request of the Employer during the Employment Period, the Executive will return to the Employer all of the Proprietary Items in the Executive’s possession or subject to the Executive’s control, and the Executive shall not retain any copies, abstracts, sketches, or other physical or electronic embodiment of any of the Proprietary Items.
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(b)
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Employee Inventions.
Each Employee Invention will belong exclusively to the Employer. The Executive acknowledges that all of the Executive’s writing, works of authorship, and other Employee Inventions are works made for hire and the property of the Employer, including any copyrights, patents, semiconductor mask protection, or other intellectual property rights pertaining thereto. If it is determined that any such works are not works made for hire, the Executive hereby assigns to the Employer all of the Executive’s right, title, and interest, including all rights of copyright, patent, semiconductor mask protection, and other intellectual property rights, to or in such Employee Inventions. The Executive covenants that he will promptly:
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(i)
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disclose to the Employer in writing any Employee Invention;
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(ii)
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assign to the Employer or to a party designated by the Employer, at the Employer’s request and without additional compensation, all of the Executive’s right to the Employee Invention for the United States and all foreign jurisdictions;
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(iii)
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execute and deliver to the Employer such applications, assignments, and other documents as the Employer may request in order to apply for and obtain patents or other registrations with respect to any Employee Invention in the United States and any foreign jurisdictions;
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(iv)
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sign all other papers necessary to carry out the above obligations; and
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(v)
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give testimony and render any other assistance but without expense to the Executive in support of the Employer’s rights to any Employee Invention.
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7.
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NON-COMPETITION AND NON-INTERFERENCE
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(a)
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during the Employment Period, except in the course of his employment hereunder, and during the Post-Employment Period, engage or invest in, own, manage, operate, finance, control, or participate in the ownership, management, operation, financing, or control of, be employed by, associated with, or in any manner connected with, lend the Executive’s name or any similar name to, lend Executive’s credit to or render services or advice to, any business whose products or activities compete in whole or in part with the products or activities of the Employer
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(b)
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whether for the Executive’s own account or for the account of any other person, at any time during the Employment Period and the Post-Employment Period, solicit business of the same or similar type being carried on by the Employer, from any person known by the Executive to be a customer of the Employer, whether or not the Executive had personal contact with such person during and by reason of the Executive’s employment with the Employer;
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(c)
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whether for the Executive’s own account or the account of any other person (i) at any time during the Employment Period and the Post-Employment Period, solicit, employ, or otherwise engage as an employee, independent contractor, or otherwise, any person who is or was an employee of the Employer at any time during the Employment Period or in any manner induce or attempt to induce any employee of the Employer to terminate his employment with the Employer; or (ii) at any time during the Employment Period and for three years thereafter, interfere with the Employer’s relationship with any person, including any person who at any time during the Employment Period was an employee, contractor, supplier, or customer of the Employer; or
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(d)
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at any time during or after the Employment Period, disparage the Employer or any of its shareholders, directors, officers, employees, or agents.
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8.
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GENERAL PROVISIONS
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EMPLOYER:
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EXECUTIVE:
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By:
/s/ Rick Mikles
Rick Mikles, Chairman of the Board
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/s/ David Baker
David Baker
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Salary: |
$100,000 per year, payable according to the Company’s payroll policy.
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Bonuses: |
Executive shall be paid a cash bonus of $6,000 within 5 days of executing this agreement.
Executive will receive a cash bonus as determined by the Compensation Committee of the Board of Directors no later than 45 days from the close of the Company’s fiscal year end.
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NOTE: |
All payments to Executive are subject to withholding.
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-
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Strike price of $0.10 per share
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-
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Three-year expiration from date of grant
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-
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VESTING: The options shall vest One Option for every Two Dollars of Revenue recognized by the Company.
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a.
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any person, entity, or group thereof acting in concert (a “
Person
”) (other than (A) the Employee, or any “affiliate” (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) of any of the foregoing, (B) the Company or any of its subsidiaries, (C) a trustee or other fiduciary holding securities under any employee benefit plan of the Company or any of its subsidiaries, (D) an underwriter temporarily holding securities pursuant to an offering of such securities or (E) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock in the Company) being or becoming the “beneficial owner” (as such term is defined in Rule 13d-3 under the Securities Exchange Act of 1934) of securities of the Company which, together with securities previously owned, confer upon such Person the combined voting power, on any matters brought to a vote of shareholders, of 50% or more of the then outstanding shares of voting securities of the Company; or
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b.
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the sale, assignment or transfer of assets of the Company or any subsidiary or subsidiaries, in a transaction or series of transactions, if the aggregate consideration received or to be received by the Company or any such subsidiary in connection with such sale, assignment or transfer is greater than fifty percent (50%) of the book value, determined by the Company in accordance with generally accepted accounting principles, of the Company’s assets determined on a consolidated basis immediately before such transaction or the first of such transactions; or
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c.
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the merger, consolidation, share exchange or reorganization of the Company (or one or more direct or indirect subsidiaries of the Company) as a result of which the holders of all of the shares of capital stock of the Company as a group would receive fifty percent (50%) or less of the combined voting power of the voting securities of the Company or such surviving or resulting entity or any parent thereof immediately after such merger, consolidation, share exchange or reorganization; or
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d.
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the adoption of a plan of complete liquidation or the approval of the dissolution of the Company; or
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e.
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the commencement (within the meaning of Rule 13e-4 under the Securities Exchange Act of 1934) of a tender or exchange offer which, if successful, would result in a Change of Control of the Company; or
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f.
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a determination by the Board of Directors of the Company, in view of the then current circumstances or impending events, that a Change of Control of the Company has occurred or is imminent, which determination shall be made for the specific purpose of triggering the operative provisions of this Agreement.
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a.
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trade secrets concerning the business and affairs of the Employer, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current, and planned research and development, current and planned manufacturing or distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies, databases, systems, structures, and architectures (and related formulae, compositions, processes, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information), and any other information, however documented, that is a trade secret within the meaning of the Florida Uniform Trade Secrets Act; and
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b.
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information concerning the business and affairs of the Employer (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel, personnel training and techniques and materials), however documented except as disclosed by Employer to the public; and
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c.
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notes, analysis, compilations, studies, summaries, and other material prepared by or for the Employer containing or based, in whole or in part, on any information included in the foregoing.
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1.
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EMPLOYMENT TERMS AND DUTIES
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2.
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COMPENSATION
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2.1
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Compensation.
|
(a)
|
Salary and Bonuses.
The Executive’s cash compensation shall be provided by the Company pursuant to
Exhibit A
attached hereto, subject to annual review and adjustment by the Board.
|
(b)
|
Equity Grant
. The Executive will be granted equity in the Company as listed on
Exhibit B
attached hereto (the “Equity Grant”). Following a Company Change of Control Transaction (as hereinafter defined), all unvested options under the Equity Grant shall vest upon the closing of the Change of Control Transaction. Such shares will be issued in a transaction that is exempt from the registration requirements of the Securities Act of 1933, as amended, and such shares shall be, upon issuance, validly issued, fully paid, and non-assessable. The certificates representing said shares shall bear the Company’s standard restrictive legend.
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(c)
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Benefits.
The Executive will, during the Employment Period, be permitted to participate in such pension, profit sharing, bonus, life insurance, hospitalization, major medical or health plan, and other employee benefit plans of the Employer that may be in effect from time to time, to the extent the Executive is eligible under the terms of those plans (collectively, the "Benefits").
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3.
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FACILITIES AND EXPENSES
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4.
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VACATIONS AND HOLIDAYS
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5.
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TERMINATION
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(a)
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upon the death of the Executive;
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(b)
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upon the disability of the Executive (as defined in Section 5.2) immediately upon notice from either party to the other;
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(c)
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upon dismissal For Cause (as defined in Section 5.3), immediately upon notice from the Employer to the Executive, or at such later time as such notice may specify; or
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(d)
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upon notice For Good Reason (as defined in Section 5.4) upon not less than thirty days' prior notice from the Executive to the Employer.
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(a)
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Termination upon Death.
If this Agreement is terminated because of the Executive's death, the Executive will be entitled to receive his Salary through the end of the calendar month in which his death occurs, and that part of the Executive's Incentive Compensation, if any, for the Fiscal Year during which his death occurs, prorated through the end of the calendar month during which his death occurs.
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(b)
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Termination upon Disability.
If this Agreement is terminated by either party as a result of the Executive's disability, as determined under Section 5.2, the Employer will pay the Executive his Salary through the remainder of the calendar month during which such termination is effective and for the lesser of (i) six consecutive months thereafter, or (ii) the period until disability insurance benefits commence under the disability insurance coverage furnished by the Employer to the Executive.
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(c)
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Termination by the Employer For Cause.
If the Employer terminates this Agreement For Cause, the Executive will be entitled to receive his Salary only through the date such termination is effective, but will not be entitled to any further Compensation for the Fiscal Year during which such termination occurs or any subsequent Fiscal Year.
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(d)
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Termination by the Executive For Good Reason or by the Employer without Cause.
If the Executive terminates this Agreement For Good Reason, or if the Employer terminates the Employee without Cause, the Employer will pay the Executive (i) the Executive's Salary for the remainder, if any, of the calendar month in which such termination is effective and for twelve (12) consecutive calendar months thereafter, and (ii) the Executive's Bonuses, if any, for the Fiscal Year during which the termination is effective, prorated through the date of termination and for a period of six (6) months thereafter.
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(e)
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Benefits.
The Executive's accrual of, or participation in plans providing for, the Benefits will cease at the effective date of the termination of this Agreement, and the Executive will be entitled to accrued Benefits pursuant to such plans only as provided in such plans. The Executive will not receive, as part of his termination pay pursuant to this Section 5, any payment or other compensation for any vacation, holiday, sick leave, or other leave unused on the date the notice of termination is given under this Agreement.
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6.
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NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS
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(a)
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Confidentiality.
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(i)
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During and at all times following the Employment Period, the Executive will hold in confidence the Confidential Information and will not disclose it to any person except with the specific prior written consent of the Employer or except as otherwise expressly permitted by the terms of this Agreement.
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(ii)
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Any trade secrets of the Employer will be entitled to all of the protections and benefits under applicable state or federal law including trade secret law. If any information that the Employer deems to be a trade secret is found by a court of competent jurisdiction not to be a trade secret for purposes of this Agreement, such information will, nevertheless, be considered Confidential Information for purposes of this Agreement. The Executive hereby waives any requirement that the Employer submit proof of the economic value of any trade secret or post a bond or other security.
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(iii)
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None of the foregoing obligations and restrictions applies to any part of the Confidential Information that the Executive demonstrates was or became generally available to the public other than as a result of a disclosure by the Executive.
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(iv)
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The Executive will not remove from the Employer's premises (except to the extent such removal is for purposes of the performance of the Executive's duties at home or while traveling, or except as otherwise specifically authorized by the Employer) any document, record, notebook, plan, model, component, device, data, or computer software or code, whether embodied in a disk or in any other form (collectively, the "Proprietary Items"). The Executive recognizes that, as between the Employer and the Executive, all of the Proprietary Items, whether or not developed by the Executive, are the exclusive property of the Employer. Upon termination of this Agreement by either party, or upon the request of the Employer during the Employment Period, the Executive will return to the Employer all of the Proprietary Items in the Executive's possession or subject to the Executive's control, and the Executive shall not retain any copies, abstracts, sketches, or other physical or electronic embodiment of any of the Proprietary Items.
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(b)
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Employee Inventions.
Each Employee Invention will belong exclusively to the Employer. The Executive acknowledges that all of the Executive's writing, works of authorship, and other Employee Inventions are works made for hire and the property of the Employer, including any copyrights, patents, semiconductor mask protection, or other intellectual property rights pertaining thereto. If it is determined that any such works are not works made for hire, the Executive hereby assigns to the Employer all of the Executive's right, title, and interest, including all rights of copyright, patent, semiconductor mask protection, and other intellectual property rights, to or in such Employee Inventions. The Executive covenants that he will promptly:
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(i)
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disclose to the Employer in writing any Employee Invention;
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(ii)
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assign to the Employer or to a party designated by the Employer, at the Employer's request and without additional compensation, all of the Executive's right to the Employee Invention for the United States and all foreign jurisdictions;
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(iii)
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execute and deliver to the Employer such applications, assignments, and other documents as the Employer may request in order to apply for and obtain patents or other registrations with respect to any Employee Invention in the United States and any foreign jurisdictions;
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(iv)
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sign all other papers necessary to carry out the above obligations; and
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(v)
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give testimony and render any other assistance but without expense to the Executive in support of the Employer's rights to any Employee Invention.
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7.
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NON-COMPETITION AND NON-INTERFERENCE
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(a)
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during the Employment Period, except in the course of his employment hereunder, and during the Post-Employment Period, engage or invest in, own, manage, operate, finance, control, or participate in the ownership, management, operation, financing, or control of, be employed by, associated with, or in any manner connected with, lend the Executive's name or any similar name to, lend Executive's credit to or render services or advice to, any business whose products or activities compete in whole or in part with the products or activities of the Employer
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(b)
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whether for the Executive's own account or for the account of any other person, at any time during the Employment Period and the Post-Employment Period, solicit business of the same or similar type being carried on by the Employer, from any person known by the Executive to be a customer of the Employer, whether or not the Executive had personal contact with such person during and by reason of the Executive's employment with the Employer;
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(c)
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whether for the Executive's own account or the account of any other person (i) at any time during the Employment Period and the Post-Employment Period, solicit, employ, or otherwise engage as an employee, independent contractor, or otherwise, any person who is or was an employee of the Employer at any time during the Employment Period or in any manner induce or attempt to induce any employee of the Employer to terminate his employment with the Employer; or (ii) at any time during the Employment Period and for three years thereafter, interfere with the Employer's relationship with any person, including any person who at any time during the Employment Period was an employee, contractor, supplier, or customer of the Employer; or
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(d)
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at any time during or after the Employment Period, disparage the Employer or any of its shareholders, directors, officers, employees, or agents.
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8.
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GENERAL PROVISIONS
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EMPLOYER:
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EXECUTIVE:
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|
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By:
/s/ David Baker
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/s/ Christopher J. Floyd
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David Baker, Chief Executive Officer
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Christopher J. Floyd
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Salary: |
$100,000 per year, payable according to the Company’s payroll policy.
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Bonuses: |
Executive shall be paid a cash bonus of $6,000 within 5 days of executing this agreement.
|
NOTE: |
All payments to Executive are subject to withholding.
|
-
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Strike price of $0.10 per share
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-
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Three-year expiration from date of grant
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-
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VESTING: The options shall vest One Option for every Two Dollars of Revenue recognized
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-
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by the Company.
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a.
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any person, entity, or group thereof acting in concert (a "
Person
") (other than (A) the Employee, or any “affiliate” (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) of any of the foregoing, (B) the Company or any of its subsidiaries, (C) a trustee or other fiduciary holding securities under any employee benefit plan of the Company or any of its subsidiaries, (D) an underwriter temporarily holding securities pursuant to an offering of such securities or (E) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock in the Company) being or becoming the "beneficial owner" (as such term is defined in Rule 13d-3 under the Securities Exchange Act of 1934) of securities of the Company which, together with securities previously owned, confer upon such Person the combined voting power, on any matters brought to a vote of shareholders, of 50% or more of the then outstanding shares of voting securities of the Company; or
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b.
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the sale, assignment or transfer of assets of the Company or any subsidiary or subsidiaries, in a transaction or series of transactions, if the aggregate consideration received or to be received by the Company or any such subsidiary in connection with such sale, assignment or transfer is greater than fifty percent (50%) of the book value, determined by the Company in accordance with generally accepted accounting principles, of the Company's assets determined on a consolidated basis immediately before such transaction or the first of such transactions; or
|
c.
|
the merger, consolidation, share exchange or reorganization of the Company (or one or more direct or indirect subsidiaries of the Company) as a result of which the holders of all of the shares of capital stock of the Company as a group would receive fifty percent (50%) or less of the combined voting power of the voting securities of the Company or such surviving or resulting entity or any parent thereof immediately after such merger, consolidation, share exchange or reorganization; or
|
d.
|
the adoption of a plan of complete liquidation or the approval of the dissolution of the Company; or
|
e.
|
the commencement (within the meaning of Rule 13e-4 under the Securities Exchange Act of 1934) of a tender or exchange offer which, if successful, would result in a Change of Control of the Company; or
|
f.
|
a determination by the Board of Directors of the Company, in view of the then current circumstances or impending events, that a Change of Control of the Company has occurred or is imminent, which determination shall be made for the specific purpose of triggering the operative provisions of this Agreement.
|
a.
|
trade secrets concerning the business and affairs of the Employer, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current, and planned research and development, current and planned manufacturing or distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies, databases, systems, structures, and architectures (and related formulae, compositions, processes, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information), and any other information, however documented, that is a trade secret within the meaning of the Florida Uniform Trade Secrets Act; and
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b.
|
information concerning the business and affairs of the Employer (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel, personnel training and techniques and materials), however documented except as disclosed by Employer to the public; and
|
c.
|
notes, analysis, compilations, studies, summaries, and other material prepared by or for the Employer containing or based, in whole or in part, on any information included in the foregoing.
|