EXHIBIT 4.4
EMPLOYMENT AGREEMENT
Employment Agreement dated as of January 1, 2001, between Torque
Engineering Corporation of 2932 Thorne Drive, Elkhart, Indiana 46514
(hereinafter the Company) and Michael Bennett (hereinafter the Employee).
1. Term of Employment. The Employee's employment shall begin as of
January 1, 2001, and shall continue for a period of three years thereafter.
2. Salary. The Company shall pay the Employee a salary of One Hundred
Thousand Dollars ($100,000) per year payable as follows.
(a) For employment services rendered during the period from
January 1, 2001, through April 30, 2001, the Employee shall be paid 35,543
shares which includes reimbursement of expenses as provided in paragraph 7. The
Company shall take all steps and pay all fees reasonably necessary to register
the shares of Common Stock issued to the Employee pursuant to the provisions of
this Section 2(a).
(b) For employment services rendered from May 1, 2001, though
the termination of this Agreement, the Employee's salary shall be payable in
cash in substantially equal installments in accordance with the Company's
customary payroll practices. Should the Employee be employed for only a portion
of any pay period, his salary shall be prorated to reflect the actual days of
employment during such pay period.
(c) In addition to the salary stated above, the Employee shall
be granted options to purchase a total of Seventy-five Thousand (75,000) shares
of Common Stock in accordance with the terms and conditions of the Company's
1999 Stock Option Plan. Options to purchase Twenty-five Thousand (25,000) shares
of Common stock shall be granted on October 31, 2001, October 31, 2002, and
October 31, 2003, so long as the Employee continues to be employed by the
Company on such dates, and all such options shall be immediately vested in the
Employee.
3. Duties and Position. On the terms and conditions set forth herein,
the Company hereby employs the Employee to serve as its Chief Operating Officer.
The Employee shall exercise the authority and shall have and perform the duties
and responsibilities customary to an employee serving as a Chief Operating
Officer of a corporation of the size and in the same line of business as the
Company. The Employee's duties generally will be to manage the operations of the
Company, including production and costs of the Company's plant in Elkhart,
Indiana. The Employee shall be responsible to, and shall report directly to, the
Board of Directors of the Company. The Employee's duties may be reasonably
changed, increased or reduced in accordance with the directives of the Board of
Directors.
4. Employee to Serve if Elected. Should the Employee be elected or
appointed as a director or officer of the Company during his employment, the
Employee shall serve in such office without additional compensation. The Company
is not required by this Agreement to cause the election or appointment of the
Employee as an officer or director of the Company.
5. Employee Shall Devote Full Time to Company. The Employee will devote
his full time and attention to the business of the Company, and, during his
employment, will not engage in any other business activity, regardless of
whether such activity is pursued for profit, gain, or other pecuniary advantage.
However, except as provided in Section 13 below, the Employee is not prohibited
from making personal investments in any other businesses, so long as those
investments do not require the Employee to participate in the operation of the
companies in which he invests.
6. Confidentiality of Customer List. Since the list of the Company's
customers is a valuable, special, and unique asset of the Company, the Employee
agrees, during and after the term of his employment, not to reveal the list, or
any part of it, or other Company trade secret to any person, firm, corporation,
association, or any other entity. The Company shall be entitled to restrain the
Employee from disclosing the list, or any other trade secret, to any entity to
whom the list or trade secret has been or is threatened to be disclosed. The
right of an injunction is not exclusive, and the Company may pursue any other
remedies it has against the Employee for a breach or threatened breach of this
Section, including recovery of damages.
7. Expense Reimbursement. The Company shall pay or reimburse the
Employee for all reasonable and actual out-of-pocket travel and other ordinary
business expenses incurred by the Employee in connection with the performance of
his duties under this Agreement, provided that such expenses are properly
documented in accordance with the Company's normal procedures. During the period
from January 1, 2001, through April 30, 2001, the Employee shall be entitled to
an expense allowance of One Thousand Dollars ($1,000.00) per month for temporary
housing and auto transportation while living in Elkhart, Indiana, and the
Employee shall be reimbursed for airfare for one trip per month from Elkhart,
Indiana, to his current residence in North Carolina.
8. Vacation. The Employee is entitled to an annual vacation leave of
two weeks at full pay, as may be provided by the Company's vacation policies.
The Employee shall take his vacation at times mutually agreed upon by the
Employee and the Company.
9. Benefits. The Employee shall be entitled to participate fully, on a
basis commensurate with his position at the Company, in all plans of life,
accident, medical, health and disability insurance, and other employee benefit
plans which are generally made available to employees of the Company, except for
plans which the Company's Board of Directors, in its sole discretion, adopts for
select employees to compensate them for special or extenuating circumstances.
10. Policies and Procedures. The Employee agrees to comply with all
written standards of performance, policies, rules, practices and procedures as
may be adopted by the Company from time to time.
11. Termination. This Agreement and the employment of the Employee may
be terminated as follows.
(a) Termination by Either Party in First Four Months. Either
party may terminate this Agreement effective as of April 30, 2001, upon 10 days'
written notice to the other party.
(b) Termination by the Company for Cause. The Company may
terminate this Agreement immediately for Cause, which is defined as: (i) fraud,
malfeasance, theft or misappropriation of, or embezzlement against, the assets
of the Company or any of its customers, intentional material damage to the
property or business of the Company or any of its customers, or breach of any
fiduciary duty to the Company or any of its customers; (ii) conviction of, or
plea of nolo contendere to, any felony or offense involving money or other
property of the Company or any of its ___ customers; ___ (iii) except under
circumstances of disability, cessation of the Employee's performance of his
duties under this Agreement, or the Employee's substantial failure to perform
them in a capable and conscientious manner, for a period of more than three
consecutive weeks; or (iv) intentional wrongful disclosure of the Company's
customer list described in Section 6 above.
(c) Termination by Death, Disability or Retirement. This
Agreement automatically shall terminate upon the Employee's death or retirement
(including the receipt of benefits under a retirement plan sponsored by the
Company, if any). The Company may terminate this Agreement upon a final
determination of the Employee's total or residual disability, as determined by
the Company's Board of Directors in good faith in accordance with any long-term
disability insurance policy under which the Employee may receive benefits.
(d) Termination by the Company Upon a Change of Control. The
Company may terminate this Agreement upon 30 days' written notice to the
Employee upon any of the following events: (i) the sale of all or substantially
all of the Company's assets to a single purchaser or group of associated
purchasers in one or more related transactions; (ii) the sale, exchange, or any
other transaction other than a public offering of securities immediately after
which securities of the Company representing 50% or more of the combined voting
power of the then-outstanding securities of the Company ultimately shall be
owned by person(s) who shall not have owned such securities prior to such
transaction or who shall be a party to such transaction; (iii) the Company's
termination of its business; or (iv) the merger or consolidation of the Company
in a transaction in which the Company's shareholders receive less that 51% of
the outstanding voting stock of the surviving corporation.
(e) Termination by the Company Without Cause. The Company may
terminate this Agreement without Cause and for any reason other than those
covered by Sections 11(a), (c) or (d), by giving the Employee 10 days' prior
written notice. Should the Company so request, the Employee shall continue to
work and be paid up to the date of termination. ___ If this Agreement and the
Employee's employment is terminated pursuant to this Section 11(e), the Company
shall pay the Employee a severance allowance as follows: (i) if the termination
date is on or between May 1, 2001, and October 31, 2001, the severance allowance
shall be equal to three months base pay; (ii) if the termination date is on or
between November 1, 2001, and October 31, 2002, the severance allowance shall be
equal to six months base pay; and (iii) if the termination date is on or between
November 1, 2002, and October 31, 2003, the severance allowance shall be equal
to nine months base pay.
(f) Termination by the Employee. The Employee may terminate
this Agreement for any reason by giving the Company 10 days' prior written
notice. The Employee shall work and be paid his regular salary up to the date of
termination.
12. Death Benefit. In addition to any death benefit payable under the
Company's group insurance policy, the Company will pay to the Employee's estate,
upon his death, any compensation due the Employee up to the end of the month
during which the Employee dies.
13. Non-Competition. As a material inducement to the Company to enter
into this Agreement, the Employee agrees and covenants that without the prior
written consent of the Company, during his employment with the Company and for a
period of five years thereafter, he will not engage, participate or invest,
directly or indirectly, whether as an owner, sole proprietor, partner,
shareholder, officer, director, employee, consultant, agent, founder,
co-venturer or otherwise, in any business activity anywhere within a 500-mile
radius of Elkhart, Indiana, which offers any services or products which are
competitive with the products or services of the Company.
14. Choice of Law. This Agreement shall be governed and construed in
accordance with the substantive laws of the State of Indiana, without regard to
its provisions on conflicts of laws.
15. Entire Agreement, Modification and Waiver. This Agreement
supersedes all previous negotiations, discussions and correspondence between the
parties and constitutes the entire agreement and understanding between the
parties with respect to the subject matter of this Agreement. Alteration,
modification or change of this Agreement shall be invalid except by written
instrument executed by both parties.
16. Severability. If, for any reason, any provision of this Agreement
is held invalid or unenforceable to any extent when applied to any person or
circumstance, the remaining provisions hereof shall not be affected thereby and
each provision hereof shall be enforced to the fullest extent allowed by law.
17. Assignment. This Agreement is not assignable by either party
without the written consent of the other party. Any attempt to assign, transfer
or sublicense any of the rights, duties or obligations under this Agreement
shall be void unless such consent is first obtained. Subject to the foregoing,
this Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assignees.
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
19. Notice. Any notice required or desired to be given hereunder shall
be in writing and shall be considered effective when (i) delivered, if by
personal delivery or delivery by national courier, (ii) upon receipt, if sent by
facsimile, which facsimile has been telephonically confirmed, between the hours
of 9:00 a.m. and 5:00 p.m. local time of the recipient, on a business day, or if
not, at 9:00 a.m. local time on the next business day, or (iii) upon first
attempted delivery after mailing by certified mail, return receipt requested,
postage prepaid, at the address given under the recipient's signature below.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first written above.
"COMPANY" "EMPLOYEE"
TORQUE ENGINEERING CORPORATION
- - ------------------ -----------------------
Name: Rick Wedel Michael Bennett
- - -----------------
Title: CEO
Address for purposes of notice: Address for purposes of notice:
2932 Thorne Drive 3108 Drew Hill Lane
Elkhart, Indiana 46514 Chapel Hill, North Carolina 27514
Fax: (219) 264-2628 Fax: (___) ___-_____