Attached files
| file | filename |
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| 8-K - SOLAR ENERTECH CORP | v171000_8k.htm |
| EX-10.1 - SOLAR ENERTECH CORP | v171000_ex10-1.htm |
| EX-10.4 - SOLAR ENERTECH CORP | v171000_ex10-4.htm |
| EX-10.2 - SOLAR ENERTECH CORP | v171000_ex10-2.htm |
| EX-10.5 - SOLAR ENERTECH CORP | v171000_ex10-5.htm |
| EX-99.1 - SOLAR ENERTECH CORP | v171000_ex99-1.htm |
Amended and Restated
Executive Employment,
Incentive, and Severance
Agreement
This
Amended and Restated Executive Employment, Incentive, and Severance Agreement
(the "Agreement")
is made and entered into as of January 7, 2010 (the "Effective
Date"), by and between Solar Enertech Corp. (“Company”) and Leo S. Young (the "Executive").
Capitalized terms used in this Agreement shall have the meanings set forth in
Section 5 below.
WHEREAS, the purpose of this Agreement
is to encourage Executive to remain in the employ of the Company and to continue
to devote Executive's full attention to the success of the Company, the Company
and Executive agree as follows:
1. Duties. Executive
shall serve as the Chief Executive Officer of the Company and shall perform such
duties and responsibilities as are consistent with Executive’s position,
including, without limitation, oversight of all operations and daily management
of the Company and such other duties and services as may be assigned to
Executive form time to time by the Company that are consistent with the duties
and services provided by a Chief Executive Officer. Executive agrees
that Executive shall faithfully and industriously perform to the best of
Executive’s ability the duties that may be required of Executive pursuant to the
terms of this Agreement. Executive agrees to devote as much of his
business time, skills and energy to the business of the Company as needed to
properly perform the functions of Chief Executive Officer.
2. Compensation.
2.1 Base
Salary. Pursuant to a Board-approved salary increase for 2009
(delayed for 12 months by Executive’s request), Executive’s base salary shall be
$250,000 per annum for 2010. Salary adjustments for future years
shall be determined by the Board of Directors in its sole and exclusive
discretion.
2.2 Stock Options.
Contingent on achievement of certain operating and financial metrics to be
agreed upon between the Board of Directors and the Executive, the Company plans
to award, subject to Board approval, additional options to purchase shares of
the Company’s common stock to Executive as may be determined by the Board of
Directors in its sole and exclusive discretion.
2.3 Restricted stock forfeited
by departed or departing management members. In connection
with a consolidation transaction in August 2008, Mr. Young contributed to the
Company his option to purchase 25.25 million shares of the Company’s common
stock, and a new restricted stock plan was created providing for the issuance of
25.25 million shares of restricted stock. The Board of Directors may
grant the Executive from time to time portion(s) of the forfeited shares as
determined by the Board of Directors in its sole and exclusive
discretion.
2.4 Personal Travel to
USA. The Company will provide 2 weeks of paid vacation for each 6 month
period of employment under this Agreement and for each 6 months period the
Company will pay for round trip business class airfare to/from China and the
United States for either the Executive or his spouse.
2.5 Other
Benefits. Executive shall be eligible to participate in all
other employee benefit programs as are generally available to similarly situated
employees of the Company, subject to the rules and regulations governing such
benefit programs. The Company shall not, by virtue of this provision,
be under any obligation to provide or continue to maintain any particular plan
or program or any particular benefit level under any plan or
program.
3. Termination by Company for
reasons other than Cause or Resignation by Executive Due to a Diminution of
Responsibilities. In the event of Executive’s involuntary
termination from service (i) for reasons other than Cause; or (ii) due to a
Diminution of Responsibilities, Executive shall receive the following payments
and benefits:
3.1 Accrued Salary and Vacation,
and Benefits. Executive shall receive all salary and accrued vacation
(less applicable withholding) earned through Executive's termination date, and
the benefits, if any, under Company benefit plans to which Executive may be
entitled pursuant to the terms of such plans.
3.2 Stock Award
Acceleration. Provided that Executive complies with Section 7 below, all
outstanding stock options granted and restricted stock issued by the Company to
Executive prior to the Change of Control shall become fully vested and
exercisable immediately.
3.3 Cash Severance
Payment. Provided that Executive complies with Section 7 below
prior to fiftieth (50th) day
following such termination, Executive shall receive a lump sum cash payment in
an amount equal to eighteen (18) months of Executive's then effective base
salary (less applicable withholding), paid on the first payroll date which is
fifty (50) days after the date of termination.
4. Termination by Company for
Cause or Resignation by Executive without Diminution of
Responsibilities. The provisions set forth in this
Section 4 shall apply in lieu of those in Section 3 in the event of
Executive’s Termination for Cause or Resignation without a Diminution
of Responsibilities. In the event of Executive's Termination for
Cause or Resignation without a Diminution of Responsibilities,
Executive shall only be entitled to receive all salary and accrued vacation
(less applicable withholding) earned through Executive's termination or
resignation date, as applicable, and the benefits, if any, under Company benefit
plans to which Executive may be entitled pursuant to the terms of such
plans.
5. Definitions. Capitalized terms used
in this Agreement shall have the meanings set forth in this Section
5.
5.1 "Cause" means
Executive's (a) failure to perform any reasonable and lawful duty of Executive's
position or failure to follow the lawful written directions of the Board of
Directors; (b) commission of an act that constitutes misconduct and is injurious
to the Company or any subsidiary; (c) conviction of, or pleading "guilty" or "no
contest" to, a felony under the laws of the United States or any state thereof;
(d) committing an act of fraud against, or the misappropriation of property
belonging to, the Company or any subsidiary; (e) commission of an act of
dishonesty in connection with Executive's responsibilities as an employee and
affecting the business or affairs of the Company; (f) material breach of any
confidentiality, proprietary information or other agreement between Executive
and the Company or any subsidiary; or (g) failure or refusal to carry out the
reasonable directives of the Board of Directors.
5.2 "Company" means Solar
Enertech Corp. and any successor or assign to substantially all the business
and/or assets of Solar Enertech Corp.
5.3 "Diminution of
Responsibilities" means the occurrence of any of the following
conditions, without Executive's written consent which condition(s) remain(s) in
effect twenty (20) days after receipt by Company from the Executive of a written
notice to: (a) a significant diminution in the nature or scope of Executive's
authority, title, function or duties from Executive's authority, title, function
or duties; (b) a ten percent (10%) reduction in Executive's base salary or a
twenty-five percent (25%) reduction in Executive's target bonus opportunity, if
any (in either case, unless such reduction is part of a Company officer-wide
program to reduce expenses); (c) any material breach of the terms of this
Agreement by the Company; or (d) failure of any successor or assignee to the
Company to assume this Agreement. Notwithstanding the foregoing, the Executive’s
continued employment for ninety (90) days following the occurrence of any
condition constituting “Diminution of Responsibilities” without the Executive
providing written notice to the Company shall constitute consent to, or a waiver
of right with respect to, such condition.
6. Federal Excise Tax.
If the payments and benefits provided for in this Agreement constitute
"parachute payments" within the meaning of the Internal Revenue Code of 1986, as
amended (the "Code"),
but for this Section 6, would be subject to the excise tax imposed by Section
4999 of the Code, then the payments and benefits under this Agreement will be
payable, at Executive's election, either in full or in such lesser amount as
would result, after taking into account the applicable federal, state and local
income taxes and excise tax imposed by Section 4999 of the Code, in Executive's
receipt on an after-tax basis of the greatest amount of
benefits.
7. Release of Claims.
The Company shall condition the payments and benefits set forth in Sections 3.2
and 3.3 of this Agreement upon the delivery by Executive of a signed release of
claims in a form satisfactory to the Company. With respect to the
payments provided pursuant to Sections 3 and 4.3, such Release must become
effective in accordance with its terms prior to the fiftieth (50th) day
following the termination date.
8. Agreement Not to
Solicit. If Company performs its obligations to deliver the severance
compensation set forth in Sections 3 and 4 of this Agreement, then for a period
of one (1) year after Executive's termination of employment, Executive will not
solicit any employee of the Company to discontinue that person's employment
relationship with the Company.
9. Arbitration.
9.1 Procedures. The
parties agree that any controversy, claim or dispute arising out of or in any
way relating to this Agreement, Executive’s employment by the Company, or the
ending of such employment, including, without limitation, any claim arising
under this Agreement, shall be settled by final and binding
arbitration. Arbitration shall be conducted according to the
Employment Arbitration Rules & Procedures of JAMS in effect at the time a
claim is filed. The arbitration shall be filed with JAMS and shall be
heard on a confidential and expedited basis in Santa Clara County,
California. California Code of Civil Procedure Section 1283.05, which
provides for certain discovery rights, shall apply to any
arbitration. In reaching a decision, the arbitrator shall have no
authority to change, extend, modify or suspend any of the terms of this
Agreement but shall have the authority to order injunctive and/or other
equitable relief. The arbitrator shall render an award and written
opinion in the form typically rendered in employment arbitrations no later than
thirty (30) days from the date the arbitration hearing concludes or the
post-hearing briefs (if requested) are received, whichever is
later. The opinion shall include the factual and legal basis for the
award. A judgment upon any award rendered by the arbitrator may be
entered in any court having jurisdiction. Either Executive or the
Company may bring an action in a court of competent jurisdiction, if necessary,
to compel arbitration under this provision, to obtain preliminary relief in
support of claims to be prosecuted in arbitration, or to enforce an arbitration
award. The Company shall bear the cost of the arbitrator’s fees
and other costs unique to arbitration if it is required to do so by applicable
law.
9.2 Claims Not Covered By
Arbitration. This Section 9 does not apply to or cover the
following claims: (i) claims by Executive for workers' compensation
benefits; (ii) claims by Executive for unemployment compensation benefits; (iii)
claims brought in a court of competent jurisdiction by either Executive or the
Company to compel arbitration under this Section 9, to enforce an arbitration
award or to obtain preliminary injunctive and/or other equitable relief in
support of claims to be prosecuted in an arbitration by either party; and (iv)
claims based upon a pension or benefit plan which contains an arbitration or
other dispute resolution procedure, in which case the provisions of such plan
shall apply.
9.3 Knowing and Voluntary
Consent. Executive acknowledges that he has carefully read and
understands this Section 9 and agrees to be bound by and comply with all of its
terms. Executive acknowledges that he has voluntarily agreed to
arbitrate claims and understands and acknowledges that by signing this
arbitration agreement, the Company and Executive are giving up the right to a
jury trial and to a trial in a court of law.
10. Conflict in Benefits; Effect
of Agreement. This Agreement shall supersede all prior arrangements,
whether written or oral, and understandings regarding incentive compensation and
severance compensation and shall be the exclusive agreement for the
determination of any severance compensation due upon Executive's termination of
employment.
11. Confidentiality. In
the course of Executive’s employment with the Company, Executive has acquired
and will acquire access to confidential and proprietary information about the
Company including, but not limited to, trade secrets, methods, access to files,
financial information, records, software programs, plans, budgets, practices,
concepts, strategies, methods of operation, financial and business projections
of the Company, and other information not generally available to third parties,
which, if known to them, may put the Company at a competitive
disadvantage. The foregoing shall collectively be referred to as
“Confidential Information.” Executive agrees that Executive will not
at any time, whether during his employment or thereafter, disclose to anyone
Confidential Information, or utilize such Confidential Information for
Executive’s own benefit, or for the benefit of third
parties. Executive agrees that the foregoing restrictions shall apply
whether or not such information is marked “Confidential.” Executive
agrees that the remedy at law for any breach or threatened breach of this
Section 11 will be inadequate and that the Company, in addition to any
remedy at law, shall be entitled to seek appropriate injunctive relief (without
posting of any bond or security) in case of any such breach or threatened
breach.
12. Intellectual
Property. Executive acknowledges and agrees that all results
and proceeds arising out of or resulting from Executive’s services performed for
the Company (“Company Materials”) and all Confidential Information are the
exclusive property of the Company and hereby irrevocably assigns to the Company
in perpetuity all right, title and interest, if any, which Executive may have in
and to all Company Materials and Confidential Information.
13. Miscellaneous.
13.1 Successors of the
Company. The Company will require any successor or assign (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, expressly,
absolutely and unconditionally to assume and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession or assignment had taken place.
13.2 No Employment for a
Specified Term. This Agreement does not alter Executive's at-will
employment status or obligate the Company to continue to employ Executive for
any specific period of time, or in any specific role or geographic
location. Upon termination of Executive at any time, severance to
which Executive may be entitled is limited as specifically provided for
herein.
13.3 Modification of
Agreement. This Agreement may be modified, amended or superseded only by
a written agreement signed by Executive and the Chairman of the Board of
Directors.
13.4 Governing Law. This
Agreement shall be interpreted in accordance with and governed by the laws of
the State of California and each party agrees to be exclusively bound to the
terms and jurisdiction agreed upon in Section 9, and shall not bring any claim
against the other in any other place or forum.
13.5 Application of Section
409A.
(a) Notwithstanding
anything set forth in this Agreement to the contrary, no amount payable pursuant
to this Agreement which constitutes a “deferral of compensation” within the
meaning of the Treasury Regulations issued pursuant to Section 409A of the Code
(the “Section 409A Regulations”) shall be paid unless and until Executive has
incurred a “separation from service” within the meaning of the Section 409A
Regulations. Furthermore, to the extent that Executive is a
“specified employee” within the meaning of the Section 409A Regulations as of
the date of Executive’s separation from service, no amount that constitutes a
deferral of compensation which is payable on account of Executive’s separation
from service shall paid to Executive before the date (the “Delayed Payment
Date”) which is first day of the seventh month after the date of Executive’s
separation from service or, if earlier, the date of Executive’s death following
such separation from service. All such amounts that would, but for
this Section, become payable prior to the Delayed Payment Date will be
accumulated and paid on the Delayed Payment Date.
(b) The Company
intends that income provided to Executive pursuant to this Agreement will not be
subject to taxation under Section 409A of the Code. The provisions of
this Agreement shall be interpreted and construed in favor of satisfying any
applicable requirements of Section 409A of the Code. However, the Company does not
guarantee any particular tax effect for income provided to Executive pursuant to
this Agreement. In any event, except for the Company’s
responsibility to withhold applicable income and employment taxes from
compensation paid or provided to Executive, the Company shall not be responsible
for the payment of any applicable taxes on compensation paid or provided to
Executive pursuant to this Agreement.
13.6 Independent Legal
Advice. Executive hereby acknowledges that Executive has acted
for himself in the preparation and negotiation of this Agreement and
acknowledges that Executive has been advised to seek independent legal counsel
to review this Agreement, and in particular tax counsel, prior to its
execution.
IN WITNESS WHEREOF the parties
have executed the Agreement effective January 7, 2010.
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EXECUTIVE
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SOLAR
ENERTECH CORP.
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/s/ Leo Shi
Young
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By:
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/s/ Steve Mao Ye
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LEO
S. YOUNG
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Name:
Steve Mao Ye
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Title:
Chief Financial Officer
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