Exhibit 10.1
May 12, 2009
Stephan J. DeLuca
c/o DayStar Technologies, Inc.
2972 Stender Way
Santa Clara, CA 95054
Dear Stephan:
This letter sets forth the substance
of the separation agreement (the “Agreement”) that
DayStar Technologies, Inc. (the “Company”) is offering
to you to aid in your employment transition.
1. Separation. As was requested by the Board
of Directors of the Company, you hereby resign from all positions
that you hold with the Company, including your position as CEO and
as a member of the Company’s Board of Directors (the
“Board”), and the Company hereby accepts such
resignations, effective as of May 12, 2009 (the
“Separation Date”).
2. Accrued Salary and Paid Time Off. On the
Separation Date, the Company will pay you all accrued salary, and
all accrued and unused vacation earned through the Separation Date,
subject to standard payroll deductions and withholdings. You are
entitled to these payments by law.
3.
Severance.
The Company will pay you severance in the form of continuation of
your base salary in effect on the Separation Date for a period of
four (4) months after the Separation Date. These payments will
be made monthly in advance on the 15 th day of each month (or the first
Monday immediately following the 15 th of the month if the 15
th
falls on a weekend)
beginning on May 15 th , and will be subject to
standard payroll deductions and withholdings. On the first payroll
date following the Effective Date, the Company will pay you in a
lump sum the salary continuation payments that you would have
received on or prior to such date under the original schedule but
for the delay in the effectiveness of this Agreement, with the
balance of the payments being paid as originally scheduled. You
acknowledge and agree that these benefits are being provided to you
in lieu of any benefits that you may be entitled to receive under
your Amended and Restated Employment Agreement dated
December 5, 2008 (the “Employment Agreement”), and
that your receipt of these benefits shall extinguish any obligation
that the Company may have to provide you with severance benefits,
including any obligation under the Employment Agreement.
4. COBRA. To the extent provided by the
federal COBRA law or, if applicable, state insurance laws, and by
the Company’s current group health insurance policies, you
will be eligible to continue your group health insurance benefits
at your own expense following the Separation Date. Later, you may
be able to convert to an individual policy through the provider of
the Company’s health insurance, if you wish. You will be
provided with a separate notice describing your rights and
obligations under COBRA. If you timely elect continued coverage
under COBRA, the Company, as part of this Agreement and an
additional severance benefit, will reimburse your COBRA premiums to
continue your group health insurance coverage through COBRA at the
level in effect as of the Separation Date (including dependent
coverage, if applicable), for six (6) months after the
Separation Date to the extent such coverage remains
available.
5. New Employment. If you are offered
permanent full-time employment with another entity within six
(6) months after the Separation Date, and you accept such
employment, then upon your acceptance of such employment, the
Company’s obligations to provide any further severance
payments and COBRA reimbursements set forth above in Sections 3 and
4 shall cease immediately. You hereby agree to notify the Company
promptly upon accepting new employment, with such notice to be
provided in writing and sent to me at the Company’s corporate
headquarters in Santa Clara, California.
6. Stock Options. Under the terms of your
stock option agreement and the applicable plan documents, vesting
of your stock options will cease as of the Separation Date. Your
right to exercise any vested shares, and all other rights and
obligations with respect to your stock options(s), will be as set
forth in your stock option agreement, grant notice and applicable
plan documents.
7. Other Compensation or Benefits. You
acknowledge that, except as expressly provided in this Agreement,
you have not earned and will not receive from the Company any
additional compensation (including base salary, bonus, incentive
compensation, or equity), severance, or benefits before or after
the Separation Date, with the exception of any vested right you may
have under the express terms of a written ERISA-qualified benefit
plan (e.g., 401(k) account) or any vested options.
8. Expense Reimbursements. You agree that,
within ten (10) days of the Separation Date, you will submit
your final documented expense reimbursement statement reflecting
all business expenses you incurred through the Separation Date, if
any, for which you seek reimbursement. The Company will reimburse
you for these expenses pursuant to its regular business
practice.
9. Return of Company
Property. By the close of
business on the Separation Date, you agree to return to the Company
all Company documents (and all copies thereof) and other Company
property which you have in your possession or control, including,
but not limited to, Company files, notes, drawings, records, plans,
forecasts, reports, studies, analyses, proposals, agreements,
financial information, research and development information, sales
and marketing information, customer lists, prospect information,
pipeline reports, sales reports, operational and personnel
information, specifications, code, software, databases,
computer-recorded information, tangible property and equipment
(including, but not limited to, computers, facsimile machines,
mobile telephones, servers), credit cards, entry cards,
identification badges and keys; and any materials of any kind which
contain or embody any proprietary or confidential information of
the Company (and all reproductions thereof in whole or in part).
You agree that you will make a diligent search to locate any such
documents, property and information by the close of business on the
Separation Date. If you have used any personally owned computer,
server, or e-mail system to receive, store, review, prepare or
transmit any Company confidential or proprietary
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