Attached files
| file | filename |
|---|---|
| EX-10.2 - EMPLOYMENT AGREEMENT - root9B Holdings, Inc. | rtnb_ex102.htm |
| EX-99.1 - PRESS RELEASE - root9B Holdings, Inc. | rtnb_ex991.htm |
| 8-K - CURRENT REPORT - root9B Holdings, Inc. | rtnb_8k.htm |
Exhibit 10.1
EMPLOYMENT
AGREEMENT
This
EMPLOYMENT AGREEMENT (the
"Agreement"), dated as of November 22, 2016 (the "Effective
Date"), is by and between root9B Technologies, Inc., a Delaware
corporation ("root9B" or the "Company") with offices located at 206
E. Virginia Ave., Phoenix, AZ 85004, and William Hoke
("Executive").
Section 1.
Employment. The Company
hereby employs Executive and Executive hereby accepts such
employment, subject to the terms and conditions set forth in this
Agreement.
Section
2.
Duties. Executive will serve
as Chief Financial Officer of the Company with responsibility for
all Accounting and Finance related functions for the Company.
Executive will report to the President and COO, or such other
designee of the board of directors of root9B. During the Term,
Executive will devote substantially all of Executive's business
time to the performance of his duties to the Company.
Section
3.
Term and Place of Employment.
3.1
Term of Employment. The term
of this Agreement shall be for the period commencing on the
Effective Date and ending November 22, 2018 subject to earlier
termination by the parties pursuant to Sections, 6 and 7 hereof
(the "Term"). The Term
may be extended under mutually agreed upon terms and conditions. If
the Term expires and the Executive and Company agree that Executive
will remain employed with the Company but do not enter into a new
employment agreement, then such employment shall be "at-will" and
the Agreement will be of no further force or effect other than with
respect to the provisions of the Agreement that are expressly
intended to survive the expiration of the Term.
3.2
Place of Employment. Executive will be assigned
to work at the office of the Company currently located at 206 E
Virginia Ave Phoenix, AZ 85004. Executive may be required to travel
as may be reasonably necessary to fulfill his duties.
Section
4.
Compensation of Executive.
During the Term, the Company will provide Executive with the
following compensation, less such deductions as will be required to
be withheld by applicable law and regulations:
4.1
Salary. The Company will pay
to Executive an annual base salary of $225,000 per annum (the "Base
Salary") at such regular weekly, biweekly or semi-monthly time or
times as root9B makes payment of its regular payroll in the regular
course of business.
4.2
Bonus. In addition to the
Base Salary, the Company may pay Executive stock or cash bonuses at
its discretion.
4.3
Options. The Company will
grant Executive Options for 300,000 shares of common stock at the
closing market price upon issuance. The shares will vest 1/3 upon
the Effective Date, 1/3 after your one year anniversary and 1/3
after your second year anniversary.
4.4
Expenses. The Company will
provide Executive with reimbursement for reasonable and necessary
business travel (except daily commuting to and from the office)
expenses and other bona fide expenses, consistent with Company
policy, incurred by Executive on behalf of the Company, in
connection with the performance of Executive's duties
hereunder.
4.5
Benefits. Executive will be
permitted to participate in all employee benefit plans, practices
and programs maintained by root9B, as in effect from time to time,
on a basis no less favorable than is provided to other similarly
situated employees of root9B and its subsidiaries. Such benefit
plans may include: medical, hospitalization, dental or vision
plans, disability insurance plans, health programs and pension or
retirement plans.
1
Section
5.
Vacations/Sick Leave/Paid Time
Off. Executive will be entitled to paid time off in the
amount provided by root9B to its similarly situated employees,
which currently provides for 15 paid days off per year and
increases based on tenure.
Section
6.
Disability/Death of
Executive. If Executive becomes Disabled the Company may, at
its option, terminate the employment of Executive under this
Agreement immediately upon giving Executive notice to that effect.
Executive's employment will terminate upon his death.
Section
7.
Termination of Employment.
7.1
Termination For Cause. The
Company may terminate the employment of Executive at any time for
Incurable Cause by giving Executive notice of termination, with
reasonable specificity of the basis for the Incurable Cause and, if
a Curable Cause, a notice of termination that sets forth the steps
that Executive must take to cure the Curable Cause. Executive's
employment will terminate immediately upon notice that includes an
Incurable Cause. Executive's termination for a Curable Cause will
take effect 30 days after the giving of the notice unless Executive
substantially cures the Cause within such 30 day
period.
7.2
Termination Without Cause.
The Company may terminate the employment of Executive without Cause
by giving Executive 15 days' notice.
7.3
Termination for Good Reason;
Resignation. Executive may (i) resign or (ii) terminate his
employment for Good Reason by giving the Company 30 days' written
notice, which shall set forth the steps that the Company must take
to cure the same, which notice shall take effect 30 days after
the giving of such
notice unless the basis for the Good Reason is cured by the Company
within such 30 day period.
Section
8.
Effect of Termination of Employment.
8.1
Termination for Disability, Death,
Cause or Resignation without Good Reason. Upon the Company's
termination of Executive's employment due to Executive's
Disability, death, the Company's termination of Executive's
employment for Cause or Executive's resignation without Good
Reason, he will not have any further rights under this Agreement
except the right to receive (i) the accrued but unpaid portion of
his Base Salary prorated as necessary in order to account for any
partial year up to the Termination Date (the "Unpaid Salary
Amount"), and (ii) reimbursement for any accrued expenses for which
he has not been reimbursed (the "Expense Reimbursement
Amount").
8.2
Termination without Cause or
Resignation for Good Reason. Upon the termination of
Executive's employment by the Company without Cause under Section
7.2 or by Executive for Good Reason, the Company will: (i) pay
Executive severance compensation equal to the greater of the unpaid
Base Salary through November 22, 2018 or one half of the Base
Salary, (ii) pay Executive the Expense Reimbursement Amount, and (iii) in
the event of any Change of Control where the acquirer does not
assume this Agreement, accelerate vesting of outstanding Company
stock options so that as of the Termination Date, the options will
be considered fully vested and exercisable.
Section
9.
Disclosure of Confidential
Information. Executive recognizes that he has had and
will
continue to have
access to secret and confidential information regarding the
Company, including but not limited to its customer list, products,
formulae, know-how, and business and marketing plans ("Confidential
Information"). He acknowledges that the Confidential Information is
of great value to the Company, is the sole property of the Company,
and has been and will be acquired by Executive in confidence.
Executive will not
reveal, divulge or make known to any person, any Confidential
Information acquired by Executive during the course
of Executive's employment except for the benefit of the Company or
as required by Executive's job duties. The provisions of this
Section 9 will survive until the third anniversary of the
Termination Date.
2
Section
10.
Indemnification. Executive
shall be entitled to the same rights to indemnification
(and
advancement of
expenses) in connection with his service as an executive officer of
the Company or any of its Subsidiaries as those rights to
indemnification (and advancement of expenses) provided to the
Company's directors and officers. Executive's rights to
indemnification specifically include all such rights arising
pursuant to, and to the fullest extent permissible under, (a) the
Company's Articles of Incorporation and Bylaws; (b) any written
agreements between the Company and its directors or officers; (c)
insurance policies providing coverage to the Company's and/or any
Subsidiary's directors, officers and employees, including any
directors and officers indemnification insurance; and (d)
applicable law.
Section
11.
Definitions. The following words will have the
following meaning:
"Cause"
means a Curable Cause or an Incurable Cause.
"Curable Cause"
means the determination by the board of directors of root9B that:
(i) Executive has engaged in misconduct that could reasonably be
expected to have a material adverse effect on the business and
assets of the Company, or (ii) Executive's disregard of any valid
and legal directive of root9B's board of directors or its designee
consistent with this Agreement or Executive's failure to perform
his duties (other than such failure resulting from incapacity due
to Disability), which, in each case, could reasonably be expected
to have a material adverse effect on the business and assets of the
Company, or (iii) Executive's material breach of any other
provision of this Agreement.
"Change
in Control" shall mean the occurrence of any of the following after
the Effective Date: (i) one person (or more than one person acting
as a group) acquires ownership of stock of the Company that,
together with the stock held by such person or group, constitutes
more than 50% of the total fair market value or total voting power
of the stock of such corporation, provided that a Change in Control
shall not occur if any person (or more than one person acting as a
group) that currently owns more than 50% of the total fair market
value or total voting power of the Company's stock acquires
additional stock in such corporation; (ii) the Company is party to
a merger, consolidation or similar transaction or series of
transactions in which the holders of the Company stock do not,
directly: (x) hold more than 50% of the total fair market value or
total voting power of the stock of the resulting entity, and (y)
control the board of directors of the resulting entity; or (iii)
the sale of all or substantially all of the Company's assets
(excluding the IPSA sale).
"Disability" or
other forms of that word mean incapacitation or disability by
accident, sickness or otherwise so as to render Executive mentally
or physically incapable of performing the services required to be
performed under this Agreement for a period of 90 consecutive days
or for any 90 days in any period of 365 consecutive
days.
"Good
Reason" means the occurrence of any of the following events or
conditions:
(i) the assignment to
Executive of any duties materially inconsistent with the duties set
forth in Section 2;
(ii) any
other action by the Company or root9B which results in a material
diminution in Executive's position, authority, duties or
responsibilities; or
(iii) any
material failure by the Company or root9B to comply with this
Agreement or (iv) any Change of Control unless the acquirer agrees
to assume and perform this Agreement to the same extent that
the
Company would be required to perform if no succession had taken
place, except where such succession is not necessary because such
assumption occurs by operation of law.
3
"Incurable Cause"
means: (I) the reasonable determination by the board of directors
of root9B that Executive has committed an act constituting fraud,
or a felony, or criminal act; or (ii) Executive's conviction of a
crime involving moral turpitude.
"Restriction
Period" will have the definition given that term in the
Confidentiality, Non-Compete and Non-Solicitation Agreement dated
the Effective Date between Executive and root9B (the "Executive
Non-Compete Agreement").
"Term"
means a 2-year period starting on the Effective Date
and ending on the
2-year anniversary of the Effective Date.
"Termination Date"
will mean the date that Executive's employment terminates by
whatever means.
Section
12.
Miscellaneous.
12.1 Section
409A. It is the intention of the parties that no payment or
entitlement pursuant to this Agreement will give rise to any
adverse tax consequences to the Employee under Section 409A of the
Code and this Agreement shall be interpreted, applied and, to the
minimum extent necessary, amended to achieve that intention.
Notwithstanding the foregoing, the Company shall not have any
liability for the tax treatment of any payments or benefits
hereunder. Any termination of the Employee that would result in the
receipt of deferred compensation under Section 409A of the Code
must also constitute a "separation from service" (as that term is
defined in Treasury Regulation Section 1.409A-1(h)). Each payment
made under this Agreement shall be treated as a separate payment.
In the case of any payment on termination (other than in compliance
with the requirements of Treasury Regulation Section
1.409A-1(b)(9)(iii) or (v) or of any successor thereto or any other
provision that exempts a payment from Section 409A of the Code and
other than any payment that is a "short-term deferral" within the
meaning of Treasury Regulation Section 1.409A-1(b)(4)) while the
Employee is a specified employee within the meaning of Section
409A(a)(2)(B) of the Code, in no event will such payment be made
earlier than six months after the Executive's "separation from
service" within the meaning of Treasury Regulation Section
1.409A-1(h). In the event that, due to Section 409A of the Code,
the Employee does not receive one or more cash payments that would
otherwise be due during that six month period, all such delayed
payments will be made on the first day after the six-month
anniversary of his "separation from service" within the meaning of
Treasury Regulation Section 1.409A-1(h), and thereafter any
remaining payments shall be made in accordance with any existing
schedule.
12.2
Assignments. Neither
Executive nor the Company may assign or delegate any of their
rights or duties under this Agreement without the express written
consent of the other, except that the Company may assign this
Agreement in connection with the sale or other disposition of all
or substantially all of its assets and business.
12.3
Entire Agreement. This
Agreement, the Executive Non-Compete Agreement and the Executive
Offer Letter constitute and embody the full and complete
understanding and agreement of the parties and supersedes all prior
understandings and agreements with respect to Executive's
employment by the Company. In the event of a conflict between the
terms in this Agreement and the Executive Non-Compete Agreement or
the Executive Offer Letter, the terms of this Agreement shall
prevail and govern. This Agreement may be amended, modified or
changed only by an instrument in writing executed by the
Company
and Executive. The invalidity or partial invalidity of one or more
provisions of this Agreement will not invalidate any other
provision of this Agreement. No waiver by either party of any
provision or condition to be performed will be deemed a waiver of
similar or dissimilar provisions or conditions at the same time or
any prior or subsequent time.
4
12.4
Headings. The headings
contained in this Agreement are for convenience of reference only
and will not affect in any way the meaning or interpretation of
this Agreement.
12.5
Notices. All notices,
requests, demands and other communications required or permitted to
be given under this Agreement will be in writing and will be deemed
to have been duly given when delivered personally or by private
overnight delivery service to the party at the address on the
signature page or to such other address as either party may give
notice of in accordance with the provisions of this section.
Notices will be deemed given on the sooner of the date actually
received or the third business day after sending.
12.6
Governing Law. This
Agreement will be governed by and construed in accordance with the
laws of the State of Delaware without giving effect to such state's
conflicts of laws provisions. Each of the parties irrevocably
consents to the jurisdiction of the federal and state courts
located in the State of Delaware. The party prevailing shall be
entitled to recover its reasonable legal fees and expenses from the
party not prevailing.
12.7
Binding Effect. This
Agreement shall inure to the benefit of and be binding upon and
enforceable against the parties hereto and their respective
successors, heirs, beneficiaries and permitted
assigns.
12.8
Counterparts. This Agreement
may be executed in two or more counterparts, including those signed
and delivered by electronic means, each of which will be deemed an
original, but all of which together will constitute one of the same
instrument.
[Signature page
follows]
5
IN
WITNESS WHISEOF, the parties have executed this Agreement as of the
date first above written.
Employee:
/s/ William
Hoke
William
Hoke
root9B Technologies, Inc.
206 E.
Virginia Ave
Phoenix, AZ
85004
/s/ Dan
Wachtler
Name:
Dan Wachtler
Title:
President, COO
6