Exhibit
10.5
AMENDED AND
RESTATED
EMPLOYMENT
AGREEMENT
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT ("Agreement") entered into as of
June 2, 2008, between RAMDAS RAO ("Employee") and AMBIENT
CORPORATION , a Delaware corporation (collectively, the
"Company").
WHEREAS
, Employee and the
Company entered into an employment agreement dated as of September
27, 2000, as amended as of November 3, 2002 and August 11, 2004,
pursuant to which Employee served as the Company's Chief Network
Architect (the "Original Agreement");
WHEREAS
, the Company and
Employee desire to amend and restate the Original Agreement in its
entirety, including to reflect the Employee’s employment as
Chief Technology Officer, all on the terms and conditions set forth
herein;
NOW,
THEREFORE ,
in consideration of the foregoing and the mutual agreements set
forth herein, and other valuable consideration, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. EMPLOYMENT
The Company agrees to
employ Employee, and Employee hereby agrees to such employment,
subject to the terms and conditions set forth in this
Agreement.
2. TERM
The employment under
this Agreement shall become effective as of June 2, 2008 (the
"Effective Date") and continue through December 31, 2009, unless
Employee's employment is otherwise terminated earlier by the
Company or Employee in accordance with Section 5 hereof (the
"Initial Term"). If not otherwise terminated this Agreement shall
automatically renew for successive one year terms at the end of the
Initial Term, unless either Party gives notice of its intent not to
renew at least 60 days prior to the end of such term.
3. POSITIONS AND
DUTIES
(a) Upon the
commencement of the Initial Term, Employee shall continue to occupy
the position and perform the duties of Chief Technology Officer of
the Company on a full-time basis. In his capacity as Chief
Technology Officer, Employee shall report directly to, and be
responsible to, the Chief Executive Officer of the Company, or such
other Company officer as shall be designated by the Chief Executive
Officer. Employee shall perform duties and responsibilities as are
consistent with the position described above which relate to the
business of Company, or of any affiliates or subsidiaries of the
Company, or any business ventures in which Company, its affiliates
or subsidiaries may participate and as are assigned to him from
time to time by the Chief Executive Officer.
(b) Employee shall
devote 100% of his working time, attention and energies to the
business of the Company and shall assume and perform such further
reasonable and lawful responsibilities and duties as may be
assigned or directed by the Board.
(c) Employee agrees that
he will at all times devote his reasonable best efforts, skill and
ability to promote the Company's interests and work with the Chief
Executive Officer and the other executives of the
Company.
(d) Employee
acknowledges and agrees that he is required to observe all the
lawful rules and policies of the Company generally applicable to
senior executives to the extent they are not inconsistent with the
terms of this Agreement.
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4. COMPENSATION AND
BENEFITS
For the full and
faithful performance of the services to be rendered by Employee, in
consideration of Employee's obligations under this Agreement,
provided Employee is not in material breach of this Agreement and
that Employee is employed by the Company as of each relevant
payment date, and it being understood and agreed by Employee and
the Company that Employee would not be entitled to the full
compensation package and benefits without his absolute commitment
to comply with his undertakings set forth in this Agreement, the
Company shall pay to Employee and Employee shall be entitled to
receive:
(a) Base Salary .
Company will pay to Employee during the term of his employment
under this Agreement, a base salary at the annual rate of Two
hundred twenty-five thousand Dollars ($225,000) per annum less
required deductions for state and federal withholding tax, social
security and other employee taxes (said amounts hereinafter
referred to as the "Base Salary"). Any Base Salary payable
hereunder shall be paid in regular intervals in accordance with the
Company's payroll practices, but no less frequently than once each
month. Subject to review at January 1 st of each year,
commencing on January 1, 2009, Employee's Base Salary may, at the
discretion of the Chief Executive Officer, be increased for the
succeeding calendar year.
(b) Incentive
Compensation .
(i) In addition to his
Base Salary, Employee shall be eligible for an annual incentive
cash compensation as determined by the Compensation Committee of
the Board of directors (“Compensation
Committee”).
(ii) Company
Plans . Employee shall be eligible to participate, on terms no
less favorable than those afforded to other executives of the
Company, in any incentive compensation plan that may hereafter be
adopted by the Company for its executives and management employees
from time to time. Such participation shall be subject to the terms
of the applicable plans, generally applicable policies of the
Company, applicable law and the discretion of the Board of
Directors. Nothing contained in this Agreement shall be construed
to create any obligation on the part of the Company to establish
any such plan or to maintain the effectiveness of any such plan
which may be in effect from time to time.
(c) Stock Option
Grants . The Employer has previously granted stock options to
Employee under the Company's 2000 Equity Incentive Plan (the
"Plan"). Such stock options are subject to the terms of the
written stock option agreement(s) issued by the Company.
(d) Benefits .
Employee shall be entitled to participate in any employee benefit
plans, medical insurance plans, life insurance plans, disability
insurance plans, retirement plans, 401(k) and other benefit plans
which are available to any other executives of the Company. Such
participation shall be subject to the terms of the applicable plan
documents, generally applicable policies of the Company, and
applicable law.
(e) Expense
Reimbursement . The Company shall promptly pay the reasonable,
business-related expenses incurred by Employee in the performance
of his duties hereunder, including, without limitation, those
incurred in connection with business related travel,
telecommunications and entertainment, or, if such expenses are paid
directly by Employee, shall promptly reimburse the Employee for
such payment, provided that Employee has properly accounted
therefor in accordance with Company policy.
(f) Vacation .
Employee shall be entitled to four (4) weeks paid vacation in
accordance with the Company's vacation policies for its executives,
as in effect from time to time, but in no event less than four (4)
weeks per year. The timing and duration of any vacation shall be
taken at such time so as not to interfere with Employee's
responsibilities and commitment to the company as determined by the
Chief Executive Officer. Employee shall also be entitled to all
paid holidays given by the Company to its employees.
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5.
TERMINATION.
Employee's services
shall terminate upon the first to occur of the following
events:
(a) The expiration of
the Initial Term or any renewal term, if applicable;
(b) Upon Employee's date
of death or the date Employee is given written notice that he has
been determined to be disabled by the Company. For purposes of this
Agreement, Employee shall be deemed to be disabled if Employee, as
a result of illness or incapacity, shall be unable to perform
substantially his required duties for a period of sixty (60)
consecutive days or an aggregate of ninety (90) days in any twelve
(12) month period ("Incapacity"). Termination of Employee's
employment by the Company due to Incapacity shall be communicated
to Employee by written notice to Employee and shall be effective on
the tenth (10) day after receipt of such notice by Employee, unless
Employee returns to full-time performance of his required duties
before such tenth (10th) day;
(c) On the date Employee
is terminated by the Company for "Cause." For purposes of this
Agreement, Cause shall be defined as: (i) Employee's conviction of,
or plea of nolo contendre, to any felony or to a crime involving
moral depravity or fraud; (ii) Employee's commission of an act of
dishonesty or fraud or breach of fiduciary duty or act that has a
adverse effect on the name or public image of the Company (iii)
Employee's commission of an act of willful misconduct or gross
negligence, as determined by the Board, provided the Employee shall
have the opportunity to state his case before the Board prior to
the Board taking such decision to so terminate the Employee; (iv)
the failure of Employee to substantially perform his duties under
this Agreement; (v) the material breach of any of Employee's
material obligations under this Agreement; (vi) the failure of
Employee to follow a lawful directive of the Chief Executive
Officer or the Board Of Directors or (vii) excessive absenteeism,
chronic alcoholism or any other form of addiction that prevents
Employee from performing the
