Attached files
| file | filename |
|---|---|
| 10-Q - EnSync, Inc. | v174925_10q.htm |
| EX-31.2 - EnSync, Inc. | v174925_ex31-2.htm |
| EX-10.1 - EnSync, Inc. | v174925_ex10-1.htm |
| EX-32.2 - EnSync, Inc. | v174925_ex32-2.htm |
| EX-10.5 - EnSync, Inc. | v174925_ex10-5.htm |
| EX-10.4 - EnSync, Inc. | v174925_ex10-4.htm |
| EX-31.1 - EnSync, Inc. | v174925_ex31-1.htm |
| EX-10.2 - EnSync, Inc. | v174925_ex10-2.htm |
| EX-32.1 - EnSync, Inc. | v174925_ex32-1.htm |
Exhibit
10.3
ZBB
ENERGY CORPORATION
NONSTATUTORY
STOCK OPTION AGREEMENT
This
Nonstatutory Stock Option Agreement (this “Agreement”) is executed as of January
7, 2010, by and between ZBB ENERGY CORPORATION, a Wisconsin corporation (the
“Company”), and Eric Apfelbach (the “Employee”).
WITNESSETH:
WHEREAS,
the Compensation Committee of the Board of Directors of the Company wishes to
grant the Employee a Nonstatutory Stock Option in conjunction with the
Employee’s appointment as Chief Executive Officer of the Company subject to the
terms provided in this Agreement; and
WHEREAS,
the Compensation Committee of the Board of Directors of the Company anticipates
that this Agreement will promote the best interests of the Company and its
shareholders by providing the Employee a proprietary interest in the Company
with a stronger incentive to put forth maximum effort for the continued success
and growth of the Company and its subsidiaries.
NOW,
THEREFORE, in consideration of the benefits that the Company will derive in
connection with the services to be rendered by the Employee, the Company and the
Employee hereby agree as follows:
1. Determinations by
Administrator. The Administrator (as defined below) shall make
all interpretations, rules and regulations necessary to administer this
Agreement, and such determinations of the Administrator shall be binding upon
the Employee. For purposes of this Agreement, the term
“Administrator” shall mean the Compensation Committee of the Board of
Directors.
2. Option; Number of Shares;
Option Price. The Option (as defined below) granted hereunder
is intended to be a nonstatutory stock option and therefore, shall not qualify
as an incentive stock option pursuant to Section 422 of the Internal Revenue
Code of 1986, as amended (the “Nonstatutory Stock Option”). The
Employee shall have the right and option to purchase all or any part of an
aggregate one hundred thousand (100,000) shares of $0.01 par value common stock
of the Company (“Share(s)”) at the purchase price of $1.33 per Share (the
“Option”), which is equal to the Fair Market Value (as defined below) of a Share
as of the date of this Agreement. For purposes of this Agreement, the
term “Fair Market Value” shall mean, as of any date, the closing price of a
Share on the NYSE Amex.
3. Vesting and
Expiration.
(a) Vesting. Provided
the Employee is employed by the Company on the target performance date, this
Option shall vest according to the percentages below upon the achievement of the
following key performance indicators (“KPI”), such achievement as determined by
the Administrator:
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Target Performance
Date
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KPI
|
Percentage of Option to Vest
|
||
|
June
30, 2010
|
As
of June 30, 2010, the Company has adequate funding, access to funding, or
the ability to reduce expenses sufficient to carry on its normal business
operations until June 30, 2011, as determined in the sole discretion of
the Operating Committee of the Company’s Board of
Directors.
|
50%
(or 50,000 Shares)
|
||
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December
31, 2010
|
|
Based
on the financial results of the Company for the 12 months ended December
31, 2010, compared to the financial results of the Company for the 12
months ended December 31, 2009, the Company’s cost of goods sold as a
percentage of revenue has been materially reduced, as determined in the
sole discretion of the Operating Committee of the Company’s
Board.
|
|
50%
(or 50,000
Shares)
|
To the
extent the KPI is achieved, each portion of the Option specified in the schedule
above shall vest and become exercisable upon the date that the Administrator,
after consultation with the Operating Committee, certifies that the KPI has been
met (each certification date, a “Vesting Date”), which certification shall occur
as soon as practicable after the Target Performance Dates.
Upon the
Employee’s termination of employment for any reason, the Employee shall forfeit
the Option or portion of the Option that has not vested at the time of such
termination. Notwithstanding the foregoing, upon the Employee’s death
or Disability (as defined in Employee’s offer letter of employment dated January
7, 2010 (the “Offer Letter”)) while Employee is employed by the Company, the
Option shall become immediately exercisable and fully vested as to all
Shares.
(b) Expiration. To the
extent not previously exercised according to the terms hereof, each portion of
the Option shall expire on the fifth anniversary of the Vesting Date applicable
to such portion of the Option.
4. Exercise
Period.
(a) Disability. Upon
the Employee’s termination of employment due to a Disability, the Employee shall
have one (1) year from the date of such termination to exercise the Option
granted hereunder as to all or part of the Shares subject to this Option; provided, however, that this
Option shall not be exercisable subsequent to the expiration dates specified in
Section 3(b), above.
2
(b) Death. Upon the
Employee’s termination of employment due to death, the Option, as to all or any
part of the Shares subject to this Option, shall be exercisable:
(1) for
one (1) year after the Employee’s death, but in no event subsequent to the
expiration dates specified in Section 3(b), above; and
(2) only
(i) by the designated beneficiary of the Employee (such designation to be
made in writing at such time and in such manner as the Administrator shall
approve or prescribe), or, if the Employee dies without a surviving designated
beneficiary, (ii) by the personal representative, administrator, or other
representative of the estate of the Employee, or by the person or persons to
whom the deceased rights of the Employee under the Option shall pass by will or
the laws of descent and distribution. The Employee may change the
beneficiary designation at any time, by giving written notice to the
Administrator, subject to such conditions and requirements as the Administrator
may prescribe in accordance with applicable law.
(c) Other Terminations of
Employment. Upon the Employee’s termination of employment for
any reason other than those specified above in this Section 4, the Employee
shall have ninety (90) days from the date of such termination to exercise the
Option as to all or part of the Shares, provided the Employee has a present
right to exercise such Option as of the date of such termination; provided, however, that the
Option shall not be exercisable subsequent to the expiration dates specified in
Section 3(b), above. Notwithstanding the foregoing, if Employee’s
employment is terminated for Cause (as defined in the Offer Letter), to the
extent the Option held by the Employee is not effectively exercised prior to
such termination, it shall lapse immediately upon such termination.
(d) Extension of Exercise
Period. The Administrator may in its sole discretion extend
the period permitted for exercise of the Option upon the Employee’s termination
of employment as otherwise provided in this Section 4 if allowable under
applicable law.
5. Method of Exercising
Option. Except as otherwise permitted by the Administrator,
the Option shall be exercisable by delivery to the Company (to the attention of
its Secretary), at its offices in Menomonee Falls, Wisconsin, of (i) written
notice identifying the Option and stating the number of Shares with respect to
which it is being exercised, (ii) payment in full of the exercise price of the
Shares then being acquired as provided in Section 6, below, and (iii) execution
of such other documentation as is determined to be necessary or appropriate by
the Administrator from time to time the form of which shall be provided to the
Employee at the time of execution and delivery of this Agreement. The
Company shall have the right to delay the issue or delivery of any Shares to be
delivered hereunder until (i) the completion of such registration or
qualification of such Shares under federal, state, or foreign law, ruling, or
regulation as the Company shall deem to be necessary or advisable, and (ii)
receipt from the Employee of such documents and information as the Administrator
may deem necessary or appropriate in connection with such registration or
qualification or the issuance of Shares hereunder.
3
6. Payment of Exercise
Price. The exercise price shall be payable in whole or in part
in cash, Shares held by the Employee, other property, or such other
consideration consistent with the Agreement’s purpose and applicable law as may
be determined by the Administrator from time to time. Except as
otherwise determined by the Administrator at the time of grant, such price shall
be paid in cash in full at the time that the Option is exercised. If
the Employee is permitted by the Administrator to pay all or a part of the
exercise price in Shares and elects to do so, the Employee may make such payment
by delivering to the Company a number of Shares, either directly or by
attestation, which are equal in value to the purchase or exercise price
hereunder. For this purpose, all Shares so delivered shall be valued
per share at the Fair Market Value (as defined above; provided, however, if a Share
is not susceptible to valuation by the above method, the term “Fair Market
Value” of a Share shall mean the fair market value of a Share as the
Administrator may determine in conformity with pertinent law) of a Share on the
business day immediately preceding the day on which such Shares are
delivered.
7. Prohibition Against
Transfer. Unless otherwise provided by the Administrator and
except as provided below, the Option, and the rights and privileges conferred
hereby, may not be transferred by the Employee, and shall be exercisable during
the lifetime of the Employee only by the Employee. The Option shall
not be subjected to execution, attachment or similar process. The
Employee shall have the right to transfer the Option upon the Employee’s death,
either to the Employee’s designated beneficiary (such designation to be made in
writing at such time and in such manner as the Administrator shall approve or
prescribe), or, if the Employee dies without a surviving designated beneficiary,
by the terms of the Employee’s will or under the laws of descent and
distribution, subject to any limitations set forth in this Agreement and all
such distributees shall be subject to all terms and conditions of this Agreement
to the same extent as the Employee would be if still living.
8. Nature of
Option. The Employee shall not have any interest in any fund
or in any specific asset or assets of the Company by reason of the Option
granted hereunder, or any right to exercise any of the rights or privileges of a
stockholder with respect to the Option until Shares are issued in connection
with any exercise.
9. Adjustment
provisions.
(a) Share
Adjustments. In the event of any stock dividend, stock split,
recapitalization, merger, consolidation, combination or exchange of shares of
Company stock, or the like, as a result of which shares of any class shall be
issued in respect of the outstanding Shares, or the Shares shall be changed into
the same or a different number of the same or another class of stock, or into
securities of another person, cash or other property (not including a regular
cash dividend), the number of Shares subject to the Option and the exercise
price applicable to the Option shall be appropriately adjusted in such equitable
and proportionate amount as determined by the Administrator. No
fractional Share shall be issued under the Agreement resulting from any such
adjustment but the Administrator in its sole discretion may make a cash payment
in lieu of a fractional Share.
4
(b) Acquisitions. In
the event of a merger or consolidation of the Company with another corporation
or entity, or a sale or disposition by the Company of all or substantially all
of its assets, the Administrator shall, in its sole discretion, have authority
to provide for (i) waiver in whole or in part of any remaining restrictions or
vesting requirements in connection with the Option granted hereunder, (ii) the
conversion of the outstanding Option into cash, (iii) the conversion of the
Option into the right to receive securities, including options, of another
person or entity upon such terms and conditions as are determined by the
Administrator in its sole discretion and/or (iv) the lapse of the Option
after notice in writing has been given that the Option may be exercised within a
set period from the date of such notice and that any Option not exercised within
such period shall lapse.
(c) Binding
Effect. Without limiting the generality of what is provided in
Section 1 hereof and for avoidance of doubt, any adjustment, waiver, conversion
or other action taken by the Administrator under this Section 9 shall be
conclusive and binding on the Employee and the Company and any respective
successors and assigns.
10. Notices. Any
notice to be given to the Company under the terms of this Agreement shall be
given in writing to the Company at its offices in Menomonee Falls,
Wisconsin. Any notice to be given to the Employee may be addressed to
Employee’s address as it appears on the payroll records of the Company or any
subsidiary thereof. Any such notice shall be deemed to have been duly
given if and when actually received by the party to whom it is addressed, as
evidenced by a written receipt to that effect.
11. Taxes. The
Company may require payment or reimbursement of or may withhold any minimum tax
that it believes is required as a result of the grant or exercise of the Option,
and the Company may defer making delivery with respect to Shares or cash payable
hereunder or otherwise until arrangements satisfactory to the Company have been
made with respect to such withholding obligations.
12. Rights of
Employee. The Option, and any payments or other benefits
received by the Employee under the Option, is discretionary and shall not be
deemed a part of the Employee’s regular, recurring compensation for any purpose,
including without limitation for purposes of termination, indemnity, or
severance pay law of any country and shall not be included in, nor have any
effect on, the determination of benefits under any other employee benefit plan,
contract or similar arrangement provided to the Employee unless expressly so
provided by such other plan, contract or arrangement, or unless the
Administrator expressly determines otherwise.
13. Amendment. The
Administrator may amend the Agreement; provided, however, that the
Employee’s consent to such action shall be required unless the Administrator
determines that the action, taking into account any related action, would not
materially and adversely affect the Employee. However,
notwithstanding any other provision of the Agreement, the Administrator may not
adjust or amend the exercise price of the Option, whether through amendment,
cancellation and replacement grants, or any other means, except in accordance
with Section 9 hereof.
14. No Right To
Employment. The Agreement shall not confer upon the Employee
any right to continue employment with the Company or a subsidiary, nor shall it
interfere in any way with the right of the Company or such subsidiary to
terminate the Employee’s employment any time.
5
15. Severability. In
the event any provision of this Agreement shall be held illegal or invalid for
any reason, the illegality or invalidity shall not affect the remaining parts of
the Agreement, and this Agreement shall be construed and enforced as if the
illegal or invalid provision had not been included.
16. Governing Law. This Agreement and all
actions taken hereunder shall be governed by, and construed in accordance with,
the laws of the State of Wisconsin, applied without regard to the laws of any
other jurisdiction that otherwise would govern under conflict of law
principles.
6
IN
WITNESS WHEREOF, the Company has caused these presents to be executed as of the
date and year first above written, which is the date of the granting of the
Option evidenced hereby.
|
ZBB
ENERGY CORPORATION
|
||
|
By:
|
/s/
Paul F. Koeppe
|
|
|
Paul
F. Koeppe
|
||
|
Interim
Chief Executive Officer
|
||
The
undersigned Employee hereby accepts the foregoing Option and agrees to the
several terms and conditions hereof.
|
/s/
Eric C. Apfelbach
|
|
|
Employee
|
7