Item
5.02.
Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
(c),
(d)
On September 19, 2007, Alan Tannenbaum became the Chief Executive Officer and
a
member of the Board of Directors of Odyne Corporation (the “Company”). Mr.
Tannenbaum, age 39, had been a Managing Director of Lehman Brothers Inc., a
leading investment banking firm, from 1998 to May 2006. At Lehman Brothers,
he
served as the Head of Institutional Equity Sales from 2002 to 2006, where he
was
responsible for sales production of more than $300 million and managed a team
of
85 senior sales people in nine offices around the world, leading his group
to a
number one institutional sales ranking on Wall Street. Mr. Tannenbaum also
served at Lehman Brothers as the Head of European Equity Capital Markets in
London in 2001 and 2002, and Head of Telecom and Media Equity Capital Markets
from 1998 to 2000. Immediately prior to joining the Company, Mr. Tannenbaum
was
an independent investor and consultant. Mr. Tannenbaum received a B.A. degree
from the University of Michigan.
On
September 19, 2007, Alan Tannenbaum entered into an employment agreement with
the Company, a copy of which is attached as Exhibit 10.1 hereto. The employment
agreement has a term expiring one year after the initial closing of the
Company’s pending financing transaction, and requires Mr. Tannenbaum to devote
all of his time and attention during normal business hours to the business
of
the Company as the Company’s Chief Executive Officer. So long as he serves as
the Chief Executive Officer, he will also be nominated as a director. The
employment agreement provides that Mr. Tannenbaum will receive a base salary
at
the annual rate of $145,000, starting on January 1, 2008. In addition, Mr.
Tannenbaum is entitled to (a) receive a cash bonus in an amount determined
by
the Compensation Committee of the Board of Directors based on the Company
meeting or exceeding certain mutually agreed upon performance goals and (b)
participate in the Company’s employee benefit plans.
Under
Mr.
Tannenbaum’s employment agreement, the Company agreed to grant stock options to
him to purchase an aggregate of 3,000,000 shares of the Company’s common stock.
Of such stock options, options to purchase 300,000 shares will have an exercise
price equal to the closing market price of the common stock on the initial
closing date of the pending financing transaction, options to purchase 2,400,000
shares will have an exercise price equal to the average closing market price
of
the common stock on the 30 consecutive trading days on and prior to the initial
closing date of the pending financing transaction, and options to purchase
300,000 shares, which will be granted on January 2, 2008, will have an exercise
price equal to the closing market price of the common stock on such date. Each
stock option will vest in three equal installments on the second, third and
fourth anniversaries of the grant date and expire ten years after it is granted.
The Company has agreed to adopt a new incentive compensation plan or amend
its
existing plan to increase the number of available options that the Company
may
grant in order to satisfy its obligation to Mr. Tannenbaum.
The
employment agreement provides for termination of Mr. Tannenbaum’s employment
without any further obligation of the Company upon his death or disability
or
for cause. In the event that Mr. Tannenbaum’s employment is terminated without
cause or for good reason, the Company is obligated to pay his salary for the
remainder of the term. Termination for cause means termination as a result
of
(w) willful and material malfeasance, dishonesty or habitual drug or alcohol
abuse related to or affecting the performance of his duties, (x) continuing
and
intentional breach, non-performance or non-observance of any of the terms or
provisions of the employment agreement, but only after the failure to cure
the
breach within ten days of receipt of notice from the Company, (y) conduct which
the Board determines could reasonably be expected to have a material adverse
effect on the Company but only after the failure to cease such conduct within
ten days of receipt of notice from the Company, or (z) Mr. Tannenbaum’s
conviction of a felony, any crime involving moral turpitude related to or
affecting the performance of his duties or any act of fraud, embezzlement,
theft
or willful breach of fiduciary duty against the Company. Good reason means
(a)
material breach of the Company's obligations under the employment agreement,
(b)
any decrease in salary during the term of employment, or (c) any material
reduction in Mr. Tannenbaum’s duties or authority. Finally, under the employment
agreement, the parties have the right to terminate the agreement in the event
the Company does not raise at least $500,000 in gross proceeds in the pending
financing transaction by December 31, 2007.
The
employment agreement contains covenants (a) restricting Mr. Tannenbaum from
engaging in any activity competitive with the business of the Company during
the
term of the employment agreement and in the event of termination for cause
or
without good reason, for a period of one year thereafter, (b) prohibiting him
from disclosing confidential information regarding the Company, and (c)
soliciting employees, customers and prospective customers of the Company during
the term of the employment agreement and for a period of one year
thereafter.
The
foregoing summary is qualified in its entirety by reference to the full text
of
the employment agreement, attached as Exhibit 10.1, which is incorporated herein
in its entirety.
Mr.
Tannenbaum has not engaged in a related party transaction with the Company
during the last two years.
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