Exhibit 10.6

 

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

 

This Amended and Restated Executive Employment Agreement (the “Agreement”), is
made and entered into this 28th day of May, 2020 (the “Effective Date”), by and
between DropCar, Inc. (the “Company”), and Rodney Keller (“Executive”).

 

WHEREAS, Executive and AYRO, Inc. (formerly Austin EV, Inc.) (“AYRO”) are
parties to an Employment Agreement dated November 13, 2017 (the “Prior
Employment Agreement”);

 

WHEREAS, pursuant to an Agreement and Plan of Merger and Reorganization (the
“Merger Agreement”), AYRO and the Company have agreed to consummate the merger
of ABC Merger Sub, Inc., a wholly-owned subsidiary of the Company, with and into
AYRO (the “Merger”), with AYRO surviving the Merger as a wholly-owned subsidiary
of the Company; and

 

WHEREAS, Section 6.03(h) of the Merger Agreement further provides that Executive
and the Company shall enter into this Agreement to be effective as of the date
the Merger becomes effective under the Merger Agreement (the “Effective Time”);

 

NOW, THEREFORE, in consideration of the mutual promises, terms, provisions, and
conditions contained herein, the parties agree as follows:

 

1. Agreement to Employ. The Company desires to secure the services of Executive
as its Chief Executive Officer (“CEO”). The Company and Executive desire to
enter into this Agreement to, among other things, set forth the terms of
Executive’s employment with the Company. The Company and Executive acknowledge
that this Agreement supersedes any other offer, agreement or promises made by
anyone, specifically concerning the offer of employment by the Company, and this
Agreement comprises the complete agreement between Executive and the Company
concerning Executive’s employment by the Company.

 

2. Term of Agreement. This Agreement shall be binding upon and enforceable
against the Company and Executive immediately when both parties execute the
Agreement. The Agreement’s stated term and the employment relationship created
hereunder will begin on the Effective Time and will remain in effect for one (1)
year, unless earlier terminated in accordance with Section 8 (the “Initial
Employment Term”). This Agreement shall be automatically renewed for a
successive one (1) year term after the Initial Employment Term (the “Renewal
Term”), unless terminated by either party upon written notice (“Non-Renewal
Notice”) provided not less than four (4) months before the end of the Initial
Employment Term, or unless earlier terminated in accordance with Section 8. The
period during which Executive is employed under this Agreement (including the
Renewal Term) will be referred to as the “Employment Period.”

 

3. Surviving Agreement Provisions. Notwithstanding any provision of this
Agreement to the contrary, the parties’ respective rights and obligations under
Sections 6 through 10 shall survive any termination or expiration of this
Agreement or the termination of Executive’s employment for any reason
whatsoever.

 

 

 

 

4. Services to be Provided by Executive.

 

(a) Position and Responsibilities. Subject to the Agreement’s terms, Executive
agrees to serve the Company as CEO. Executive shall have the duties and
privileges customarily associated with an executive occupying such role, and
shall perform all reasonable acts customarily associated with such role, or
necessary and/or desirable to protect and advance the best interests of the
Company. Executive shall also serve as a Member of the Board of Directors of the
Company (the “Board”). For purposes of this Agreement only, all references to
the Board shall not include Executive. Executive shall resign as a member of the
Board upon termination if requested by the Company.

 

(b) Executive’s Office Location. Executive’s primary office location shall be
the Company’s business office in Round Rock, Texas.

 

(c) Executive’s Employment Representations. Executive agrees that he (i) shall
not serve as a member of any board of directors, or as a trustee of, or in any
manner be affiliated with, any present or future agency or organization (except
for civic, religious, and not for profit organizations) without the consent of
the Board, which consent will not be unreasonably withheld, other than those
board of directors or trustees on which Executive serves as of date of this
Agreement; and (ii) is required to devote sufficient working time to the Company
(other than sick time and civic responsibilities, charitable or religious
activities that do not interfere with the performance of Executive’s duties) in
order to properly carry out Executive’s duties. Executive further represents to
the Company that Executive (x) is not, to Executive’s knowledge, violating and
will not violate any contractual, legal, or fiduciary obligations or burdens to
which Executive is subject as of the date of this Agreement by entering into
this Agreement or providing services under the Agreement’s terms; (y) is, to
Executive’s knowledge, under no contractual, legal, or fiduciary obligation or
burden that will interfere with his ability to perform services under the
Agreement’s terms; and (z) has no bankruptcies, convictions, disputes with
regulatory agencies, or other discloseable or disqualifying events that would
have any material impact on the Company or its ability to conduct securities
offerings.

 

5. Compensation for Services. As compensation for the services Executive will
perform under this Agreement during the Employment Period, the Company will pay
Executive, and Executive shall accept as full compensation, the following:

 

(a) Base Salary. Executive shall receive a monthly salary of twenty thousand
eight hundred and thirty-three dollars and thirty-three cents (USD $20,833.33)
(annualized, two hundred fifty thousand dollars (U.S. $250,000.00)), less
required withholdings (the “Base Salary”), payable in equal installments
semi-monthly pursuant to the Company’s normal payroll practices. The Base Salary
may be increased in the discretion of the Board, but not decreased without the
consent of Executive. If increased, the increased amount shall constitute Base
Salary for purposes of this Agreement. During the Renewal Term, Executive shall
receive the same rate of Base Salary as in effect immediately prior to the
commencement of such Renewal Term. Executive’s compensation shall be subject to
all appropriate federal and state withholding taxes.

 

(b) Bonus Plans. For fiscal years during the Employment Period, Executive shall
be eligible to receive periodic bonuses of up to fifty percent (50%) of his Base
Salary upon achievement of target objectives and performance criteria, payable
on or before March 15th of the fiscal year following the fiscal year to which
the bonus relates. Except to the extent provided by Section 9(c), Executive
shall be entitled to a bonus for a year, subject to achievement of the
performance criteria, if he is employed by the Company as of December 31 for the
year to which services to which the bonus applies were performed. Targets and
performance criteria shall be established by the Board after consultation with
Executive. The evaluation of Executive’s performance, as measured by the
applicable targets and the awarding of bonuses, if any, shall be at the Board’s
sole discretion.

 

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(c) Equity Award. Any stock options or other equity awards outstanding and held
by Executive on the closing date of the Merger (the “Outstanding Awards”) shall
remain in place, subject to the terms and conditions of the award agreements
relating to such awards, provided, however that the option price and number of
shares subject to such options and awards shall be adjusted ratably pursuant to
the Exchange Ratio (as defined in the Merger Agreement). In addition to the
Outstanding Awards, as soon as administratively practicable after the closing
date of the Merger, the Company agrees to grant Executive an additional award of
5,553,592 restricted stock units (“RSUs”), targeted at 5% of the issued and
outstanding shares of Common Stock of the Company post-Merger on a fully diluted
basis, subject to the terms and conditions of the Company’s equity plan and form
of restricted stock unit award agreement, which terms shall include, without
limitation: (i) forfeiture of any unvested RSUs on Executive’s termination of
employment for any reason; and (ii) vesting of the RSUs in accordance with the
following 2020 AYRO performance milestones and assumptions (the successful
completion of each shall be determined by the Company in its sole discretion):

 

i. 33.33% of the RSUs (rounded down for any fractional shares) will vest upon
the Company’s receipt of purchase orders for at least 500 AYRO vehicles to be
sold to Club Car Inc. in calendar year 2020 with the following quarterly targets
1Q2020-30 vehicles; 2Q2020 – 60 vehicles; 3Q2020 – 150 vehicles; 4Q2020 260
vehicles, provided, that (1) on or before December 16, 2019, a definitive
written agreement with respect to such purchase is executed, and at least
$1,000,000 of the purchase has been received by the Company; (2) on the closing
date of the Merger, AYRO secures borrowing based on a line of credit of
$4,000,000 to support inventory purchase flow in line with the Company’s 2020
budget; (3) the Merger’s closing date is on or before February 28, 2020 and the
Company receives additional funding of at least $5,000,000 is received by such
date; (4) in the event the closing date of the Merger is after January 25, 2020,
AYRO and the investors mutually agree on earlier release of approved funding of
at least $500,000; and (5) the Company receives additional funding from third
parties of at least $1,500,000 on or before September 30, 2020 (subsections (1)
through (5) are referred to herein in as the “Assumptions”);

 

ii. An additional 33.33% of the RSUs (rounded down for any fractional shares)
shall vest on the date (x) that the Company enters into a definitive written
agreement with Club Car Inc./Ingersoll Rand on or before May 31, 2020 that
results in a minimum equity investment of $1,500,000 in AYRO, (y) Club Car
Inc./Ingersoll Rand’s agreement to publicly disclose such investment and (z) the
Assumptions have been achieved;

 

iii. The remaining RSUs shall vest on the date that the Company achieves a
minimum average valuation of 25% higher for twenty (20) out of the thirty (30)
calendar days following the end of the first full quarter after the closing date
of the Merger than the Company’s valuation on the date of the Merger, provided
that the Assumptions have been achieved by such date; and

 

In the event the performance milestones and assumptions are not achieved with
respect to a tranche of RSUs, such RSUs shall be forfeited.

 

(d) Vacation. During the Employment Period, Executive shall be entitled to
vacation in accordance with the Company’s vacation policy. Vacation shall be
taken at such times and intervals as shall be determined by Executive, subject
to the reasonable business needs of the Company.

 

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(e) Reimbursement of Ordinary Business Expenses. The Company shall reimburse
Executive for all reasonable business expenses upon the presentation of itemized
statements of such expenses in accordance with Company policies and procedures
as may be in effect from time to time.

 

(f) Other Benefits and Perquisites. Executive shall be entitled to participate
in the benefit plans provided by the Company for all employees generally, and
for the Company’s executive employees, including the availability of health and
dental insurance benefits. The Company shall be entitled to modify, amend or
terminate these benefit plans in its sole discretion at any time. Any
reimbursement of expenses made under this Agreement shall only be made for
eligible expenses incurred during the Employment Period, and no reimbursement of
any expense shall be made by the Company after December 31st of the year
following the calendar year in which the expense was incurred. The amount
eligible for reimbursement under this Agreement during a taxable year may not
affect expenses eligible for reimbursement in any other taxable year, and the
right to reimbursement under this Agreement is not subject to liquidation or
exchange for another benefit. Executive will comply with the Company’s policies
regarding these benefits, including all Internal Revenue Service rules and
requirements.

 

6. Confidential Information.

 

(a) Confidential Information. The Company shall provide Executive with
confidential information and trade secrets of the Company (hereinafter referred
to as “Confidential Information”), shall place Executive in a position to
develop and have ongoing access to Confidential Information of the Company,
shall entrust Executive with business opportunities of the Company, and shall
place Executive in a position to develop business goodwill on behalf of the
Company. For purposes of this Agreement, Confidential Information includes, but
is not limited to:

 

(i) Technologies developed by the Company and any research data or other
documentation related to the development of such technologies, including,
without limitation, all designs, ideas, concepts, improvements, product
developments, discoveries and Inventions (as defined below), whether patentable
or not, that are conceived, developed or acquired by Executive, individually or
in conjunction with others, during the period of Executive’s employment by the
Company;

 

(ii) All documents, drawings, memoranda, notes, records, files, correspondence,
manuals, models, specifications, computer programs, E-mail, voice mail,
electronic databases, maps, logs, drawings, models and all other writings or
materials of any type embodying any of such information, ideas, concepts,
improvements, discoveries, inventions (as defined below) and other similar forms
of expression that are conceived, developed or acquired by Executive
individually or in conjunction with others during the Employment Period (whether
during business hours or otherwise and whether on any Company premises or
otherwise) that relate to the Competing Business (defined below), trade secrets,
products or services;

 

(iii) Customer lists and prospect lists developed by the Company;

 

(iv) Information regarding the Company’s customers which Executive acquired as a
result of his employment with the Company, including but not limited to,
customer contracts, work performed for customers, customer contacts, customer
requirements and needs, data used by the Company to formulate customer bids,
customer financial information, and other information regarding the customer’s
business;

 

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(v) Information related to the Competing Business (defined below), including but
not limited to marketing strategies and plans, sales procedures, operating
policies and procedures, pricing and pricing strategies, business plans, sales,
profits, and other business and financial information of the Company;

 

(vi) Training materials developed by and utilized by the Company; and

 

(vii) Any other information that Executive acquired as a result of his
employment with the Company and which the Company would not want disclosed to a
business competitor or to the general public.

 

Executive understands and acknowledges that such Confidential Information gives
the Company a competitive advantage over others who do not have the information,
and that the Company would be irreparably harmed if the Confidential Information
were disclosed.

 

For purposes of this Agreement, Confidential Information shall not include
information that: (i) prior to disclosure, is or was known or generally
available to the public; (ii) after disclosure, become known to the public
through no act or omission of Executive or any other person or entity with an
obligation of confidentiality to the Company; (iii) is or was independently
developed by or Executive, without the use of or reference to Confidential
Information of the Company, and can be demonstrated by Executive through
adequate documentation was developed by Executive in this manner; or (iv) is
required to be disclosed pursuant to an applicable law, rule, regulation,
government requirement or court order, or the rules of any stock exchange
(provided however, Executive shall advise the Company of such required
disclosure promptly upon learning thereof in order to afford the Company a
reasonable opportunity to contest, limit and/or assist Executive in crafting
such disclosure and shall cooperate with the Company concerning any such attempt
to contest, limit or craft the disclosure).

 

(b) Disclosure of Confidential Information. Executive agrees that he shall hold
all Confidential Information of the Company in trust for the Company and shall
not during or after his employment terminates for any reason: (i) use the
information for any purpose other than the benefit of the Company; or (ii)
disclose to any person or entity any Confidential Information of the Company
except as necessary during Executive’s employment with the Company to perform
services on behalf of the Company. Executive shall also take reasonable steps to
safeguard such Confidential Information in Executive’s possession or control to
prevent its disclosure to unauthorized persons.

 

(c) Inventions. Executive shall promptly and fully disclose to the Company any
and all ideas, improvements, discoveries and inventions, whether or not they are
believed to be patentable (“Inventions”), that Executive conceives of or first
actually reduces to practice, either solely or jointly with others, during
Executive’s employment with the Company, and that relate to the business now or
thereafter carried on or contemplated by the Company or that result from any
work performed by Executive for the Company. Executive acknowledges and agrees
that all Inventions shall be the sole and exclusive property of the Company and
are hereby assigned to the Company. During the term of Executive’s employment
with the Company and thereafter, whenever requested to do so by the Company,
Executive shall take such action as may be requested to execute and assign any
and all applications, assignments and other instruments that the Company shall
deem necessary or appropriate in order to apply for and obtain Letters Patent of
the United States and/or of any foreign countries for such Inventions and in
order to assign and convey to the Company or their nominees the sole and
exclusive right, title and interest in and to such Inventions.

 

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(d) Return of Information. Upon termination of employment, or at any earlier
time as directed by the Company, Executive shall immediately deliver to the
Company any and all Confidential Information in Executive’s possession, any
other documents or information that Executive acquired as a result of his
employment with the Company and any copies of any such documents/information.
Executive shall not retain any originals or copies of any documents or materials
related to the Company’s Business – whether in hard copy or digital form – which
Executive came into possession of or created as a result of his employment with
the Company. Executive acknowledges that such information, documents and
materials are the exclusive property of the Company. After Executive delivers to
the Company all Confidential Information in Executive’s possession and all other
documents and/or information relating to the Company’s Business, Executive shall
immediately delete all Company Confidential Information and other documents
and/or information relating to the Company’s Business from any computer,
cellular phone or other digital or electronic device owned by Executive. In
addition, upon termination of employment, or at any time earlier as directed by
the Company, Executive shall immediately deliver to the Company any property of
the Company in Executive’s possession.

 

7. Restrictive Covenants. In consideration for (i) the Company’s promise to
provide Confidential Information to Executive and Executive’s return promise to
hold the Company’s Confidential Information in trust, (ii) the substantial
economic investment made by the Company in the Confidential Information and
goodwill of the Company, and the business opportunities disclosed or entrusted
to Executive, (iii) the compensation and other benefits provided by the Company
to Executive, and (iv) the Company’s employment of Executive pursuant to this
Agreement, and to protect the Company’s Confidential Information, customer
relationships, and goodwill, Executive agrees to enter into the following
restrictive covenants.

 

(a) Non-Competition. Executive, on his own behalf, individually or as a
principal, partner, stockholder, manager, agent, consultant, contractor,
employee, lender, investor, or as a director or officer of any corporation or
association, or in any other manner or capacity whatsoever, agrees that during
the Employment Period and for a period of twelve (12) months following
Executive’s termination (for whatever reason) (the “Restricted Period”), he
shall not, whether directly or indirectly, without the express written approval
of the Company, own, establish, manage, engage in, operate, control, work for,
consult with, render services for, do business with, maintain any interest in
(proprietary, financial, or otherwise), or participate in the ownership,
establishment, management, operation, or control of, any Competing Business in
the Restricted Area. For purposes of this Agreement, “Competing Business” means
any business, individual, partnership, firm, corporation, or other entity that
engages in any business or service which the Company provided during Executive’s
employment, and the “Restricted Area” includes the United States of America and
any state, country or territory for which Executive had business contact on
behalf of, or responsibility for, the Company during the twelve (12) month
period prior to the termination of Executive’s employment. However, Executive
may own, directly or indirectly, solely as an investment, securities of any
business traded on any national securities exchange; provided that Executive is
not a controlling person of, or the member of a group that controls such
business; provided further that Executive does not, directly or indirectly, own
two percent (2%) or more of any class of securities of such business.

 

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(b) Non-Solicitation. Executive agrees that, during the Employment Period and
thereafter during the Restricted Period, other than in connection with his
authorized duties under this Agreement, Executive shall not, directly or
indirectly, either as a principal, manager, agent, employee, consultant,
officer, director, stockholder, partner, investor, owner, or lender or in any
other capacity, and whether personally or through other persons or entities:

 

(i) Solicit business from, interfere with, attempt to solicit business with, or
do business with any customer or client of the Company with whom the Company did
business or who the Company solicited within the preceding eighteen (18) months
and who or which: (1) Executive contacted, called on, serviced or did business
with during Executive’s employment at the Company; (2) Executive learned of
solely as a result of Executive’s employment with the Company; or (3) about whom
Executive received Confidential Information. This restriction in this Section
7(b)(i) only prohibits soliciting, attempting to solicit or transacting business
for any person or entity, other than the Company, engaged in the Competing
Business of the Company or any affiliate thereof; or

 

(ii) Solicit, induce or attempt to solicit or induce, engage or hire, on behalf
of himself or any other person or entity, any person who is an employee or
consultant of the Company or who was employed by the Company within the
preceding twelve (12) months (general advertisements and similar solicitations
not directed at any specific individuals shall not be considered solicitation
for this purpose).

 

(c) Non-Disparagement. Executive agrees that the Company’s goodwill and
reputation are assets of great value to the Company and its affiliates which
were obtained through great costs, time and effort. Therefore, Executive agrees
that during his employment and after the termination of his employment,
Executive shall not in any way, directly or indirectly, disparage, libel or
defame the Company, its beneficial owners or its affiliates, their respective
business or business practices, products or services, or employees.

 

(d) No Interference. Notwithstanding any other provision of this Agreement, (i)
Executive may disclose Confidential Information when required to do so by a
court of competent jurisdiction, by any governmental agency having authority
over Executive or the business of the Company or by any administrative body or
legislative body (including a committee thereof) with jurisdiction to order
Executive to divulge, disclose or make accessible such information; and (ii)
nothing in this Agreement is intended to interfere with Executive’s right to (a)
report possible violations of state or federal law or regulation to any
governmental or law enforcement agency or entity; (b) make other disclosures
that are protected under the whistleblower provisions of state or federal law or
regulation; (c) file a claim or charge with the Equal Employment Opportunity
Commission (“EEOC”), any state human rights commission, or any other
governmental agency or entity; or (d) testify, assist, or participate in an
investigation, hearing, or proceeding conducted by the EEOC, any state human
rights commission, any other governmental or law enforcement agency or entity,
or any court. For purposes of clarity, in making or initiating any such reports
or disclosures or engaging in any of the conduct outlined in subsection (ii)
above, Executive may disclose Confidential Information to the extent necessary
to such governmental or law enforcement agency or entity or such court, need not
seek prior authorization from the Company, and is not required to notify the
Company of any such reports, disclosures or conduct.

 

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(e) Defend Trade Secrets Act. Executive is hereby notified in accordance with
the Defend Trade Secrets Act of 2016 that Executive will not be held criminally
or civilly liable under any federal or state trade secret law for the disclosure
of a trade secret that is made in confidence to a federal, state, or local
government official, either directly or indirectly, or to an attorney solely for
the purpose of reporting or investigating a suspected violation of law, or is
made in a complaint or other document that is filed under seal in a lawsuit or
other proceeding. If Executive files a lawsuit for retaliation against the
Company for reporting a suspected violation of law, Executive may disclose the
Company’s trade secrets to Executive’s attorney and use the trade secret
information in the court proceeding if Executive files any document containing
the trade secret under seal, and does not disclose the trade secret, except
pursuant to court order.

 

(f) Tolling. If Executive violates any of the restrictions contained in this
Section 7 (other than subsection (c) of this Section 7), the Restricted Period
shall be suspended and will not run in favor of Executive from the time of the
commencement of any violation until the time when Executive cures the violation
to the satisfaction of the Company.

 

(g) Remedies. Executive acknowledges that the restrictions contained in Sections
6 and 7 of this Agreement, in view of the nature of the Company’s business and
his position with the Company, are reasonable and necessary to protect the
Company’s legitimate business interests, Confidential Information and goodwill
and that any violation of Sections 6 and 7 of this Agreement may result in
irreparable injury to the Company. In the event of a breach or threatened breach
by Executive of Sections 6 or 7 of this Agreement, the Company may (i) seek a
temporary restraining order and injunctive relief restraining Executive from the
commission of any breach, and (ii) if the Company is the prevailing party,
recover reasonable attorneys’ fees, expenses and costs the Company incurs in
such action. Further, if the Company prevails in any action brought by Executive
(or anyone acting on his behalf) seeking to declare any term in this Section 7
void or unenforceable or subject to reduction or modification, then the Company
shall be entitled to recover attorneys’ fees, expenses and costs the Company
incurs in such action. Similarly, if Executive prevails in any action brought by
the Company (or anyone acting on its behalf) seeking to enforce any term in
Section 6 or 7, then Executive shall be entitled to recover reasonable
attorneys’ fees, expenses and costs he incurs in such action. Nothing contained
in this Agreement shall be construed as prohibiting the Company from pursuing
any other remedies available to it for any breach or threatened breach,
including, without limitation, the recovery of money damages. The existence of
any claim or cause of action by Executive against the Company, whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Company of Section 6 or 7 of this Agreement. If Executive, in
the future, seeks or is offered employment, or any other position or capacity
with another person or entity, Executive agrees to inform each such person or
entity of the restrictions in Sections 6 and 7 of this Agreement. Further,
before accepting any employment or other position with any person or entity
during the Restricted Period, Executive agrees to give prior written notice to
the Company of the name and address of such person or entity. The Company shall
be entitled to advise such person or entity of the provisions of Sections 6 and
7 and to otherwise deal with such person or entity to ensure that the provisions
of Sections 6 and 7 are enforced.

 

(h) Reformation. The courts shall be entitled to modify the duration and scope
of any restriction contained herein to the extent such restriction would
otherwise be unenforceable, and such restriction as modified shall be
enforceable. Executive acknowledges that the restrictions imposed by this
Agreement are legitimate, reasonable and necessary to protect the Company’s
investment in its Confidential Information, businesses, customer relationships
and the goodwill thereof. Executive acknowledges that the scope and duration of
the restrictions contained herein are necessary and reasonable in light of the
time that Executive has been engaged in the business of the Company, Executive’s
reputation in the markets for the Company’s business and Executive’s
relationship with the suppliers, customers and clients of the Company obtained
through Executive’s employment with the Company.

 

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8. Termination of Agreement. The employment relationship between Executive and
the Company created under this Agreement shall terminate before the expiration
of the stated term of this Agreement upon the occurrence of any one of the
following events:

 

(a) Death or Permanent Disability. This Agreement, and Executive’s employment,
shall be terminated effective on the death or permanent disability of Executive.
For this purpose, “permanent disability” shall mean that Executive has, by
reason of any medically determinable physical or mental impairment, been
determined to be disabled under a long-term disability benefits plan covering
employees of the Company or is determined to be totally disabled by the U.S.
Social Security Administration.

 

(b) Termination by the Company for Cause. The Company may terminate Executive’s
employment hereunder for Cause at any time after providing written notice to
Executive. For purposes of this Agreement, the term “Cause” shall mean any of
the following:

 

(i) an act or acts of theft, embezzlement, fraud, or willful or material
misrepresentation by Executive;

 

(ii) an act or acts of intentional dishonesty or willful misrepresentation of a
material nature;

 

(iii) any willful misconduct by Executive with regard to the Companies;

 

(iv) a material breach by Executive of any fiduciary duties owed by him to the
Companies;

 

(v) Executive’s conviction of, or pleading nolo contendere or guilty to, a
felony or misdemeanor (other than a traffic infraction) that is reasonably
likely to cause damage to the Companies or the Companies’ reputation;

 

(vi) a material violation of the Companies’ written policies, standards or
guidelines, which Executive failed to cure within thirty (30) days;

 

(vii) Executive’s refusal to perform the material duties and responsibilities
lawfully and ethically required to be performed by Executive under the terms of
this Agreement, which Executive failed to cure within thirty (30) days after
receiving written notice from the Board; and

 

(viii) a material breach by Executive of this Agreement or any other agreement
to which Executive and the Companies are parties that is not cured by Executive
within thirty (30) days after receipt by Executive of a written notice from the
Companies of such breach specifying the details thereof.

 

(c) Termination by the Company Without Cause. The Company may terminate this
Agreement and Executive’s employment at any time upon thirty (30) days written
notice to Executive without Cause, during which period Executive shall not be
required to perform any services for Employer other than to assist the Company
in training his successor and generally preparing for an orderly transition.

 

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(d) Termination by Executive. Executive may terminate this Agreement and his
employment without Good Reason at any time upon thirty (30) days written notice
to the Company. Executive may also terminate his employment for Good Reason. For
purposes of this Agreement, the term “Good Reason” shall mean the occurrence of
any of the following without Executive’s prior written consent:

 

(i) a material reduction in Executive’s Base Salary;

 

(ii) a material diminution in Executive’s title, duties, responsibility or
authority; or

 

(iii) relocation without Executive’s consent for three consecutive months or
more to an office located fifty (50) miles outside of Executive’s principal
place of business.

 

Any event described in (i) through (iii) shall not constitute Good Reason unless
Executive delivers to the Companies a written notice of termination for Good
Reason within ninety (90) days after Executive first learns of the existence of
the circumstances giving rise to Good Reason, and within thirty (30) days
following delivery of such notice, the Company or Companies, as applicable, have
failed to cure the circumstances giving rise to Good Reason.

 

(e) Separation from Service. For purposes of this Agreement, including, without
limitation, Sections 8 and 9, any references to a termination of Executive’s
employment shall mean a “separation from service” as defined by Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”) and the Treasury
Regulations and other guidance issued thereunder.

 

(f) Notice of Termination. Any termination of Executive’s employment hereunder
(other than as a result of the death of Executive or as a result of the
expiration of the Employment Term or any Renewal Term if either party has given
a Non-Renewal Notice to the other), whether by the Company or by Executive,
shall be communicated by written Notice of Termination to the other party
hereto. For purposes of this Agreement, a “Notice of Termination” shall mean a
written notice that shall indicate (i) the specific termination provision in
this Agreement relied upon; (ii) the basis for the termination; and (iii) the
date of termination.

 

9. Compensation Upon Termination for Any Reason. Upon the termination of
Executive’s employment under this Agreement before the expiration of the stated
term in this Agreement, Executive shall be entitled to the following:

 

(a) Termination by the Company for Cause or as a Result of the Resignation of
Executive. In the event that Executive’s employment is terminated by the Company
for Cause, or as a result of Executive’s resignation, the Company shall, in
addition to any benefits provided under any employee benefit plan or program of
the Company, pay the following amounts to Executive (or his estate or other
legal representative, as the case may be) within the time period required by
applicable law (and in all events within thirty (30) days of such termination):

 

(i) any accrued but unpaid Base Salary (as determined pursuant to Section 5(a)
hereof, including any shares of common stock) for services rendered to the date
of termination;

 

(ii) any accrued but unpaid expenses required to be reimbursed pursuant to
Section 5(e) hereof; and

 

-10-

 

 

(iii) All vested outstanding stock options shall remain exercisable until the
earlier of expiration of the option’s term or the date that is two (2) years
following Executive’s termination of employment.

 

The amounts described in Sections 9(a)(i), 9(a)(ii) and 9(a)(iii) above,
together with benefits provided under any employee benefit plan or program of
the Company, shall be referred to herein as the “Accrued Obligations.”

 

(b) Termination by Reason of Death or Disability of Executive. In the event that
Executive’s employment is terminated by reason of Executive’s death or
Disability, the Company shall pay the Accrued Obligations to Executive (or his
estate or other legal representative, as the case may be) within the time period
required by applicable law (and in all events within thirty (30) days of such
termination). In addition, the Company shall pay Executive any earned, but
unpaid, bonus under Section 5(b) for services rendered during the year preceding
the date of termination within the time period provided by Section 5(b) for
payment of bonuses (the “Accrued Bonus”).

 

(c) Termination by the Company Without Cause or Upon Non-Renewal, or by
Executive for Good Reason. In the event that Executive’s employment is
terminated by the Company without Cause or by reason of non-renewal of the
Agreement by the Company as provided by Section 2 hereof or by Executive for
Good Reason, the Company shall pay and/or provide the following amounts to
Executive:

 

(i) the Accrued Obligations within the time period required by applicable law
(and in all events within thirty (30) days of such termination), except for
employee benefits that shall be provided in accordance with the terms applicable
to such benefits, and the Accrued Bonus within the time period provided by
Section 5(b) hereof for payment of bonuses; and

 

(ii) subject to compliance with the restrictive covenants in Section 7 and the
execution and timely return by Executive of a release of claims provided by the
Company (the “Release”) which the Company shall deliver to Executive within five
(5) business days following the termination of Executive’s employment, and
subject to the provisions of Section 11 below:

 

(1) The Company shall pay Executive an amount equal to twelve (12) months Base
Salary, payable in equal monthly installments over twelve (12) months (the
“Severance Period”). The first installment shall commence on the sixtieth (60th)
day following the termination of Executive’s employment but shall include all
installment amounts that would have been paid during the first sixty (60) days
following the termination of Executive’s employment had installments commenced
immediately following the date of termination. Notwithstanding the foregoing, if
Executive’s employment terminates under this Section 9(c) in connection with, or
within twenty-four (24) months following, a “Change in Control” (as defined in
the AYRO 2020 LTIP PLAN), then the amount of severance set forth above shall be
doubled, but shall remain payable over the Severance Period determined without
regard to such doubling of the amount of severance.

 

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(2) The Company shall pay Executive an amount equal to the greater of (x) the
most recent annual bonus earned by Executive, (y) the average of the immediately
preceding two year’s annual bonuses earned by Executive, or (z) if Executive’s
termination of employment occurs during the first calendar year of the Initial
Employment Term before any annual bonus for a full twelve (12)-month period of
service has been paid, then the target bonus Executive is eligible for under
Section 5(b) hereof (the greater of clauses (x), (y) or (z), the “Bonus
Amount”), provided that no Bonus Amount shall be payable if the bonuses for the
year of termination are subject to achievement of performance goals and such
performance goals are not achieved by the Company for such year. The Bonus
Amount shall be paid at the same time bonuses would be payable under Section
5(b) hereof if Executive was actively employed. Notwithstanding the foregoing,
if Executive’s employment terminates under this Section 9(c) in connection with,
or within twenty-four (24) months following, a “Change in Control” (as defined
in the AYRO 2020 LTIP PLAN), then the amount of Bonus Amount set forth above
shall be doubled.

 

(3) All outstanding stock options and restricted stock unit awards granted to
Executive pursuant to Section 5(c) hereof shall be fully and immediately vested,
to the extent not previously vested. Shares with respect to the restricted stock
unit awards that become vested hereunder shall be delivered to Executive within
ten (10) days following the date that the Release is effective.

 

(4) The Company shall provide Executive with continued healthcare coverage under
the Company’s group health plan at the same cost, if any, imposed on active
employees of the Company, until the earlier of (x) the expiration of the
Severance Period, (y) the date that Executive’s “COBRA” coverage terminates or
expires. Such healthcare coverage shall be provided pursuant to COBRA. To the
extent any such benefits are otherwise taxable to Executive, such benefits
shall, for purposes of Section 409A of the Code, be provided as separate in-kind
payments of those benefits, and the provision of in-kind benefits during one
calendar year shall not affect the in-kind benefits to be provided in any other
calendar year.

 

In the event Executive fails to comply with the restrictive covenants in Section
7 or does not timely execute and return (or otherwise revokes) a release of
claims in the form and substance reasonably requested by the Company, no amount
shall be payable to Executive pursuant to this Section 9(c)(ii).

 

10. Other Provisions.

 

(a) Remedies; Legal Fees. Each of the parties to this Agreement shall be
entitled to enforce its rights under this Agreement, specifically, to recover
damages by reason of any breach of any provision of this Agreement and to
exercise all other rights existing in its favor. The prevailing party shall be
entitled to attorney’s fees.

 

-12-

 

 

(b) Limitations on Assignment. In entering into this Agreement, the Company is
relying on the unique personal services of Executive; services from another
person will not be an acceptable substitute. Except as provided in this
Agreement, Executive may not assign this Agreement or any of the rights or
obligations set forth in this Agreement without the explicit written consent of
the Company. Any attempted assignment by Executive in violation of this Section
10(b) shall be void. Except as provided in this Agreement, nothing in this
Agreement entitles any person other than the parties to the Agreement to any
claim, cause of action, remedy, or right of any kind, including, without
limitation, the right of continued employment. No rights or obligations of the
Company under this Agreement may be assigned or transferred by the Company
without Executive’s prior written consent, except that such rights or
obligations may be assigned or transferred pursuant to a merger or consolidation
in which the Company is not the continuing entity, or a sale, liquidation or
other disposition of all or substantially all of the assets of the Company,
provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and assumes the liabilities,
obligations and duties of the Company under this Agreement, either contractually
or as a matter of law. The Company further agrees that, in the event of any
disposition of its business and assets described in the preceding sentence, it
shall cause such assignee or transferee expressly to assume the liabilities,
obligations and duties of the Company hereunder.

 

(c) No Mitigation or Offset. In the event of termination of Executive’s
employment for any reason, Executive shall be under no obligation to seek other
employment and there shall be no offset against amounts due to him on account of
any remuneration or benefits from any subsequent employment that he may obtain.

 

(d) Severability and Reformation. The parties intend all provisions of this
Agreement to be enforced to the fullest extent permitted by law. If, however,
any provision of this Agreement is held to be illegal, invalid, or unenforceable
under present or future law, such provision shall be fully severable, and this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision were never a part hereof, and the remaining provisions
shall remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance. In lieu of such
illegal, invalid or unenforceable provision, there shall be added automatically
as a part of this Agreement a legal, valid and enforceable provision as similar
in terms to such illegal, invalid or unenforceable provision as may be possible,
and the Company and Executive hereby request the court to whom disputes relating
to this Agreement are submitted to reform the otherwise unenforceable covenant
in accordance with this Section 10(d).

 

(e) Notices. Any notice or other communication required, permitted or desired to
be given under this Agreement shall be deemed delivered when personally
delivered; the business day, if delivered by overnight courier; the same day, if
transmitted by facsimile on a business day before noon, Eastern Standard Time;
the next business day, if otherwise transmitted by facsimile; and the third
business day after mailing, if mailed by prepaid certified mail, return receipt
requested, as addressed or transmitted as follows (as applicable):

 

If to Executive:

 

The address of Executive’s principal residence kept in the Company’s records,
with a copy to him (during the Employment Period) at his office.

 

If to the Company:

 

AYRO, Inc.

900 E. Old Settlers Boulevard, Suite 100
Round Rock, TX 78664

 

(f) Further Acts. Whether or not specifically required under the terms of this
Agreement, each party shall execute and deliver such documents and take such
further actions as shall be necessary in order for such party to perform all of
his or its obligations specified in the Agreement or reasonably implied from the
Agreement’s terms.

 

-13-

 

 

(g) Publicity and Advertising. Executive agrees that the Company may use his
name, picture, or likeness for any advertising, publicity or other business
purpose at any time, during the term of this Agreement and may continue to use
materials generated during the term of this Agreement for a period of six (6)
months thereafter. The use of Executive’s name, picture, or likeness shall not
be deemed to result in any invasion of Executive’s privacy or in violation of
any property right Executive may have; and Executive shall receive no additional
consideration if his name, picture or likeness is so used. Executive further
agrees that any negatives, prints or other material for printing or reproduction
purposes prepared in connection with the use of his name, picture or likeness by
the Company shall be and are the sole property of the Company.

 

(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS (RULES) OR CHOICE OF LAWS (RULES) THEREOF.

 

(i) Venue. The exclusive venue for all suits or proceedings arising from or
related to this Agreement shall be in a court of competent jurisdiction in
Williamson County, Texas.

 

(j) Waiver. A party’s waiver of any breach or violation of any Agreement
provisions shall not operate as, or be construed to be, a waiver of any later
breach of the same or other Agreement provision.

 

(k) Entire Agreement, Amendment, Binding Effect. This Agreement constitutes the
entire agreement between the parties concerning the subject matter in this
Agreement. No oral statements or prior written material not specifically
incorporated in this Agreement shall be of any force and effect, and no changes
in or additions to this Agreement shall be recognized, unless incorporated in
this Agreement by written amendment, such amendment to become effective on the
date stipulated in it. Executive acknowledges and represents that in executing
this Agreement, he did not rely, and has not relied, on any communications,
promises, statements, inducements, or representation(s), oral or written, by the
Company, except as expressly contained in this Agreement. Any amendment to this
Agreement must be signed by all parties to this Agreement. This Agreement will
be binding on and inure to the benefit of the parties hereto and their
respective successors, heirs, legal representatives, and permitted assigns (if
any). This Agreement supersedes any prior agreements between Executive and the
Company concerning the subject matter of this Agreement.

 

(l) Counterparts. This Agreement may be executed in counterparts, with the same
effect as if both parties had signed the same document. All such counterparts
shall be deemed an original, shall be construed together and shall constitute
one and the same instrument.

 

(m) Indemnification. The Company agrees to maintain a directors’ and officers’
liability insurance policy covering Executive in an amount, and on terms and
conditions (including without limitation, with respect to scope, exclusions,
sub-amounts and deductibles), no less favorable to him than the coverage the
Company provides other senior executives and directors from time to time.
Executive’s indemnification rights shall be outlined by such policy and to the
extent applicable, the Company by-laws and other governing documents.

 

-14-

 

 

(n) Attorney’s Fees. The Company agrees to pay or reimburse Executive for
reasonable attorney’s fees incurred by Executive in connection with the review
of this Agreement, up to a maximum of $10,000. Such payment will be made
promptly following execution of this Agreement.

 

11. Section 409A of the Code.

 

(a) To the extent (i) any payments to which Executive becomes entitled under
this Agreement, or any agreement or plan referenced herein, in connection with
Executive’s termination of employment with the Company constitute deferred
compensation subject to Section 409A of the Code; (ii) Executive is deemed at
the time of his separation from service to be a “specified employee” under
Section 409A of the Code; and (iii) at the time of Executive’s separation from
service the Company is publicly traded (as defined in Section 409A of Code),
then such payments (other than any payments permitted by Section 409A of the
Code to be paid within six (6) months of Executive’s separation from service)
shall not be made until the earlier of (x) the first day of the seventh month
following Executive’s separation from service or (y) the date of Executive’s
death following such separation from service. Upon the expiration of the
applicable deferral period described in the immediately preceding sentence, any
payments which would have otherwise been made during that period (whether in a
single sum or in installments) in the absence of this Section 11 shall be paid
to Executive or Executive’s beneficiary in one lump sum, plus interest thereon
at the Delayed Payment Interest Rate computed from the date on which each such
delayed payment otherwise would have been made to Executive until the date of
payment. For purposes of the foregoing, the “Delayed Payment Interest Rate”
shall mean the national average annual rate of interest payable on jumbo
six-month bank certificates of deposit, as quoted in the business section of the
most recently published Sunday edition of The New York Times preceding
Executive’s separation from service.

 

(b) To the extent any benefits provided under Sections 5 (b) or (f) above are
otherwise taxable to Executive, such benefits shall, for purposes of Section
409A of the Code, be provided as separate in-kind payments of those benefits,
and the provision of in-kind benefits during one calendar year shall not affect
the in-kind benefits to be provided in any other calendar year.

 

(c) In the case of any amounts payable to Executive under this Agreement, or
under any plan of the Company, that may be treated as payable in the form of “a
series of installment payments,” as defined in Treas. Reg. §1.409A-2(b)(2)(iii),
Executive’s right to receive such payments shall be treated as a right to
receive a series of separate payments for purposes of Treas. Reg.
§1.409A-2(b)(2)(iii).

 

(d) It is intended that this Agreement comply with or be exempt from the
provisions of Section 409A of the Code and the Treasury Regulations and guidance
of general applicability issued thereunder, and in furtherance of this intent,
this Agreement shall be interpreted, operated, and administered in a manner
consistent with such intent.

 

[Signature Page Follows]

 

-15-

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first indicated above.

 

  THE COMPANY:       AYRO, Inc.       By: /s/ Joshua Silverman   Name: Joshua
Silverman   Title: Chairman of the Board of Directors

 

  EXECUTIVE:       /s/ Rodney Keller   Rodney Keller

 

[Signature Page to Rodney Keller’s Employment Agreement]