EXHIBIT 10.2
 
 
EMPLOYMENT AGREEMENT
 
This Agreement (the “Agreement”), dated as of December 8, 2010, is by and
between AMP Holding Inc., a Nevada corporation (the “Company”) and Stephen S.
Burns (hereinafter referred to as the “Executive”).
 
Introduction
 
The Company desires that the Executive perform services for the Company pursuant
to the terms and conditions set forth herein.  The Executive will have
significant access to information concerning the Company and its business.  The
disclosure of such information or the engaging in competitive activities would
cause substantial harm to the Company.
 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
 
1. Term.  The initial term of this Agreement (the “Initial Term”) shall commence
on the date of the signing of this agreement by both parties (the “Effective
Date”), and continue for two years thereafter (unless this Agreement is
terminated earlier in accordance with Section 10 below).  Upon the expiration of
the Initial Term, this Agreement shall be automatically renewed for consecutive
one-year terms, unless a party hereto gives the other party written notice of
non-renewal, which notice must be received no later than 60 days prior to the
expiration of the Term.  The Initial Term, together with any extension thereof,
is sometimes referred to herein as the “Term.”
 
2. Duties.  The Executive will serve as the President of the Company and shall
have duties of an executive nature that are attendant to his position as
described in the by-laws of the Company and as may be reasonably assigned to him
by the Board of Directors of the Company (the “Board”) and the CEO. The
Executive will report to the CEO but nothing herein shall interfere with or
limit the oversight responsibilities of the Board.  Unless otherwise agreed to
by the Executive and the Board, the Executive’s principal base of operation will
be based in Cincinnati, Ohio region.
 
3. Full Time; Best Efforts.  The Executive shall use his best efforts to promote
the interests of the Company and shall devote his full business time and efforts
to its business and affairs and shall not provide management services to any
other company or otherwise engage in business activities that would reasonably
be expected to materially interfere with the performance of the Executive’s
duties, services and responsibilities hereunder.
 
4. Compensation and Benefits.  During the Term, the Executive will receive the
following compensation and benefits:
 
(a) Base Salary.  The Executive will receive a salary at the rate of $200,000
annually (the “Base Salary”); provided, however, only fifty-percent (50%) of the
Base Salary ($100,000) shall be payable in equal increments of not less often
than monthly in arrears and in any event consistent with the Company’s payroll
policy and practices. The remaining fifty-percent (50%) of the Base Salary (the
“Deferred Salary”) shall accrue and be deferred until such time that the Board
elects to increase the Base Salary to include all or a portion of the Deferred
Salary.  However, the Board, in its absolute sole discretion, will only increase
the Base Salary to include all or a portion of the Deferred Salary in connection
to a significant event, such as a Change in Control (as defined below) or the
Company achieving positive cash flows from operating activities as set forth in
the Company’s financial statements as filed with the Securities and Exchange
Commission. In addition, the Base Salary of the Executive may from time to time
be increased, but not decreased, by the Board, in its absolute discretion.
 
 
 
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(b) Bonus.  The Executive will be eligible for annual bonuses with a target
amount of 100% of his Base Salary (the “Bonus”).  The actual amount of any Bonus
may be more or less than such target and shall be determined by the Board based
on the achievement of corporate and individual objectives determined by the
Board on an annual basis, in its absolute discretion.  Half (50%) of the Bonus
may be paid, in the Company’s discretion, in unregistered common stock, par
value $0.001 per share, of the Company (“Common Stock”), at a price per share
equal to the weighted average closing price per share of the Common Stock over
the twenty most recent trading days on the Over-the-Counter Bulletin Board (the
“OTCBB”) as reported by a reliable reporting service (“Reporting Service”) as
determined by the Company or, if the OTCBB is not the principal trading market
for such security, the weighted average closing price per share of the Common
Stock over the twenty most recent trading days on the principal securities
exchange or trading market where such security is listed or traded.  If the
trading price cannot be calculated for such security on such date in the manner
provided above, the trading price shall be the fair market value as determined
by the Company.    In the event the Company elects to pay all or any portion of
such bonus in shares of Common Stock, the payment of such shares shall be
deferred at the Executive’s election by crediting such shares to a notional
account with the Company and shall be distributed from such account upon the
later of (i) the date designated (to the extent consistent with Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”)) by the Executive
with respect to such bonus or (ii) the earliest to occur of the 30th day after
the first anniversary of the date that annual bonuses are paid in cash or would
have been paid to the other members of management of the Company, or the
Executive’s death, disability or termination of employment.
 
(c) Benefits.  In addition to the Base Salary and any Bonus, the Executive will
be entitled to receive health, welfare and fringe benefits that are generally
available to the Company’s management employees in accordance with the then
existing terms and conditions of the Company’s policies.   The Company’s current
fringe benefits for management employees are set forth on Exhibit A hereto.  The
Executive will be entitled to reimbursement of all reasonable expenses incurred
by him in his performance of services on behalf of the Company hereunder,
subject to the presentation of appropriate documentation and other reimbursement
policies generally applicable to the Company’s management employees.
 
(d) Withholding.  The Company will withhold from compensation payable hereunder
all applicable federal, state and local withholding taxes. 
 
(e) Options.  As additional compensation to the Executive hereunder, the Company
will, at the Effective Time, execute and deliver options, granting the Executive
the right to purchase (i) 300,000 shares of the Common Stock, at an exercise
price per share equal to the weighted average closing price per share of the
Common Stock over the twenty most recent trading days on the OTCBB as reported
by a Reporting Service or, if the OTCBB is not the principal trading market for
such security, the weighted average closing price per share of the Common Stock
over the twenty most recent trading days on the principal securities exchange or
trading market where such security is listed or traded.  If the trading price
cannot be calculated for such security on such date in the manner provided
above, the trading price shall be the fair market value as determined by the
Company, which shall vest in equal annual installments starting on the Effective
Date and on the anniversary of this Agreement for two years thereafter , and
shall be exercisable for ten years from the grant date (the “Time-Vested
Options”).  The Time-Vested Options shall be Nonstatutory Stock Options within
the meaning of the Plan.  The Time-Vested Options shall be issued pursuant to an
option grant which, except as otherwise provided for in this Agreement, shall be
in the form used for other participants in the Company’s 2010 Stock Incentive
Plan (the “Plan”).  Except as otherwise provided in Section 10 below, in no
event shall the Time-Vested Options vest unless the Executive is a full time
employee of the Company on the vesting date.  The Board may also, in its sole
discretion, at the time the equity compensation of other management employees of
the Company is reviewed, consider and grant additional equity-based compensation
to the Executive during the Term.
 
 
 
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(f) Common Stock Purchase Warrants. The Company agrees to also provide the
Executive with a Common Stock Purchase Warrant to acquire 300,000 shares of
Common Stock exercisable at any time over next five years at an exercise price
of $2.00 per share.
 

 
5. Confidentiality.  The Executive agrees that during the Term and thereafter:
 
(a) The Executive has not and will not at any time, directly or indirectly,
disclose or divulge any Confidential Information (as hereinafter defined),
except as reasonably necessary or advisable in connection with the performance
of the Executive’s duties for the Company, or except to the extent required by
law (but only after the Executive, to the extent practicable given the nature of
the legal requirement, has provided the Company with reasonable notice and
opportunity to take action against any legally required disclosure).  As used
herein, “Confidential Information” means all information concerning the business
of the Company or of any of its subsidiaries (“Related Companies”), or any
customer or vendor of any of the Related Companies, (whether or not subject to
copyright, patent or other intellectual property protection) that has an
independent economic value from not being readily known, is not ascertainable by
proper means by others and is not generally known to the public, or which would
constitute a trade secret as may be defined by the Uniform Trade Secrets Act or
under the laws governing this Agreement, and any oral, electronic or written
communications thereof, including, but not limited to, specifications, designs,
concepts, plans, programs, software, other developments relating to products and
services, proposal plans, marketing data and financial information, and all
copies and tangible embodiments thereof (in whatever form or medium); provided,
that Confidential Information shall not include any information that is publicly
available through no fault of the Executive or disclosed pursuant to applicable
securities laws.
 
(b) The Executive has not and shall not make use whatsoever, directly or
indirectly, of any Confidential Information at any time, except as reasonably
necessary or advisable in connection with the performance of the Executive’s
duties for the Company.
 
(c) Upon the Company’s request at any time and for any reason, the Executive
shall immediately deliver to the Company all materials (whether in electronic or
hard copy form) in the Executive’s possession which contain or relate to
Confidential Information.
 
(d) When in possession of Confidential Information, the Executive will not
engage in any transaction in the Company’s securities.
 
6. Intellectual Property.
 
(a) All inventions, modifications, discoveries, designs, developments,
improvements, processes, software programs, works of authorship, documentation,
formulae, data, techniques, know-how, secrets or intellectual property rights or
any interest therein (collectively, the “Developments”) made by the Executive,
either alone or in conjunction with others, at any time or at any place during
his service with the Company, whether or not reduced to writing or practice
during such period, which relate to the business in which any Related Company is
then engaged or in which any Related Company then intends to engage, shall be
and hereby are the exclusive property of the Company without any further
compensation to the Executive.  Any Developments employed and made by the
Executive, either solely or jointly with others, within six months following the
termination of the Executive’s services hereunder that relate to the Company’s
actual day-to-day operations or core competencies in which the Executive was
actively involved, shall be irrefutably presumed to have been made in the course
of such employment with the use of the Company’s time, materials or
facilities.  In addition, without limiting the generality of the prior sentence,
all Developments which are copyrightable work by the Executive are intended to
be “work made for hire” as defined in Section 101 of the Copyright Act of 1976,
as amended, and shall be and hereby are the property of the Company without any
further compensation to the Executive.
 
 
 
 
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(b) If, and to the extent, any of the Developments is not considered a “work for
hire,” the Executive shall, without further compensation, assign to the Company
and does hereby assign to the Company, the Executive’s entire right, title and
interest in and to all Developments.  At the Company’s expense and at the
Company’s request, the Executive shall provide reasonable assistance and
cooperation, including, without limitation, the execution of documents in order
to obtain, enforce, defend and/or maintain the Company’s proprietary rights in
the Developments throughout the world.  The Executive hereby irrevocably
designates and appoints the Company and its duly authorized officers and agents
as the Executive’s agent and attorney-in-fact (which designation and appointment
shall be deemed coupled with an interest and shall survive the Executive’s death
or incapacity), to act for and in the Executive’s behalf to execute and file any
such applications, extensions or renewals and to do all other lawfully permitted
acts to further the prosecution and issuance of such letters patent, other
intellectual property registrations or filings, or such other similar documents,
with the same legal force and effect as if executed by the Executive.
 
7. Noncompetition.  The Executive acknowledges and agrees that in the
performance of this Agreement, he will be brought into frequent contact, either
in person, by telephone, through electronic means or through the mails, with
existing and potential customers of the Company.  The Executive also
acknowledges that any Confidential Information gained by his during the Term has
been developed by the Company through substantial expenditures of time and money
and constitutes valuable and unique property of the Company.  The Executive
further understands and agrees that the foregoing makes it necessary for the
protection of the Company’s business that the Executive not compete with the
Company during the Term and not compete with the Company for a reasonable period
after the Term, as further provided in the following provisions.  Accordingly,
the Executive agrees that so long as she is an employee of the Company and for
12 months thereafter:
 
(a) The Executive will not, directly or indirectly, individually or as a
consultant to, or employee, officer, director, manager, stockholder, partner,
member or other owner or participant in any business entity, other than the
Company or a Related Company, engage in or assist any other person or entity to
engage in any business which directly or indirectly competes with any business
in which the Company or any Related Company is engaging or in which the Company
or any Related Company plans to engage or is actively evaluating engaging,
during or at the time of the termination of the Executive’s engagement
hereunder, anywhere in the United States or anywhere else in the world where the
Company or any Related Company does business, or plans to do business or is
actively evaluating doing business; provided that nothing contained herein shall
prohibit the Executive from being a passive owner of less than one percent (1%)
of the outstanding stock or any class of securities of any corporation or other
entity which is publicly traded or privately held; and
 
(b) The Executive will not, directly or indirectly, individually or as a
consultant to, or employee, officer, director, manager, stockholder, partner,
member or other owner or participant in any business entity solicit or endeavor
to entice away from the Company or any Related Company, or offer employment or
any consulting arrangement to, or otherwise materially interfere with the
business relationship of the Company or any Related Company with, any person or
entity who is, or was within the one year period immediately prior to the
termination of the Executive’s engagement hereunder, (i) employed by or a
consultant to the Company or any Related Company or (ii) a customer or client
of, supplier to or other party having material business relations with the
Company or any Related Company.
 
8. Remedies.  Without limiting the remedies available to the Company and any
Related Company, the Executive acknowledges that a breach of any of the
covenants contained in Sections 5, 6 and 7 herein could result in irreparable
injury to the Company and, as applicable, a Related Company, for which there
might be no adequate remedy at law, and that, in the event of such a breach or
threat thereof, the Company and any affected Related Company, as the case may
be, shall be entitled to obtain a temporary restraining order and/or a
preliminary injunction and a permanent injunction restraining the Executive from
engaging in any activities prohibited by Sections 5, 6 and 7 herein or such
other equitable relief as may be required to enforce specifically any of the
covenants of Sections 5, 6 and 7 herein.  The foregoing provisions and the
provisions of Sections 5, 6 and 7 herein shall survive the term of this
Agreement and the termination of the Executive’s engagement hereunder, and shall
continue thereafter in full force and effect.
 
9. Recordings.  The Executive hereby gives the Company and its assigns
permission to capture and record his image or likeness by means of photograph,
facial imaging or similar means (“Recordings”); to make reasonable edits to
these Recordings at its discretion and to incorporate these Recordings into
publications, brochures, databases, or any other media (“Publications”); and to
use such Recordings and Publications for the limited purposes of marketing,
publicizing, or otherwise promoting the products and/or services of the Company
or any of its affiliates.
 
10. Termination.
 
(a) General.  The engagement of the Executive under this Agreement may be
terminated prior to the end of any Term (i) by a majority vote of the
disinterested members of the Board with Cause or without Cause, or (ii) in the
event of the death or Disability of the Executive.  The Executive may terminate
his engagement hereunder prior to the end of any Term for Good Reason or for no
reason.  Upon the termination of the Executive’s engagement hereunder, this
Agreement shall terminate and the Term shall expire on such date.
 
 
 
 
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(b) Certain Defined Terms.  As used herein, the following terms shall have the
following meanings:
 
 
“Cause” means: (i) the Executive’s willful and continued failure to
substantially perform his reasonably assigned duties as an officer of the
Company or otherwise perform his obligations under Sections 2 and 3 above (other
than any such failure resulting from incapacity due to physical or mental
condition or any failure after the Executive gives notice of termination for
Good Reason) which failure is not cured within 30 days after a written demand
for substantial performance or adherence is received by the Executive from the
Board which specifically identifies the manner in which the Board believes the
Executive has not substantially performed his duties or obligations; (ii) the
Executive’s willful and continued breach of the Company’s material corporate
policies that have been approved by the Board, which breach is not cured within
30 days after a written demand specifying such breach is received by the
Executive from the Board; (iii) the Executive’s willful engagement in illegal
conduct or gross misconduct which is materially injurious to the Company; (iv)
the Executive’s willful engagement in a violation of any federal or state
securities laws or the Company’s Policy Regarding Special Trading Procedures, as
may be amended; or (v) the Executive’s material breach of Sections 3, 5, 6
and/or 7 of this Agreement and, in the case of any purported breach of Section
3, 5, 6 or 7 that is capable of being cured, such breach is not cured within 30
days after a written demand for performance or adherence is received by the
Executive from the Board which specifically identifies the manner in which the
Board believes the Executive has breached such provision.
 
 
“Change in Control” means an event or occurrence set forth in any one or more of
subsections (i) through (iv) below, including an event or occurrence that
constitutes a Change in Control under one of such subsections but is
specifically exempted from another such subsection:
 
(i)  
the acquisition by an individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) (a “Person”) of beneficial ownership of any capital stock of
the Company if, after such acquisition, such Person beneficially owns (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) 50% or more of
either:

 
(A)  
the then-outstanding shares of common stock of the Company (the “Outstanding
Company Common Stock”) or

 
(B)  
the combined voting power of the then-outstanding securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”);

 
 
provided, however, that for purposes of this subsection (i), the following
acquisitions shall not constitute a Change in Control:
 
(C)  
any acquisition of Outstanding Company Common Stock or Outstanding Company
Voting Securities directly by the Company or any issuance of capital stock by
the Company, in each case, solely in connection with a recapitalization or
restructuring of the Company or similar transaction that does not involve, and
is not part of series of transactions that would involve, any entity that is not
an affiliate of the Company; or

 
(D)  
any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company.

 
(ii)  
such time as the Continuing Directors do not constitute a majority of the Board
(or, if applicable, the Board of Directors of a successor corporation to the
Company).  The term “Continuing Director” means at any date a member of the
Board:

 
(A)  
who was a member of the Board on the Effective Date;

 
(B)  
who, after the Effective Date, is nominated or elected by (or whose nomination
to the Board is recommended or endorsed by) at least a majority of the directors
who were directors on the Effective Date or are Continuing Directors;

 
 
 
 
 
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provided, however, that this clause (B) excludes any individual whose initial
assumption of office occurred as a result of an actual or threatened election
contest with respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents, by or on behalf of a person
other than the Board.
 
(iii)  
the consummation of a merger, consolidation, reorganization, recapitalization,
or statutory share exchange involving the Company, or a sale or other
disposition of all or substantially all of the assets of the Company in one or a
series of transactions (a “Business Combination”),

 
 
provided, however, that the following shall not constitute a Change in
Control:  if immediately following a Business Combination, all or substantially
all of the individuals and entities who were the beneficial owners of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Business Combination:
 
(A)  
beneficially own, directly or indirectly, more than 50% of the then-outstanding
shares of common stock in, and the combined voting power of the then-outstanding
securities entitled to vote generally in the election of directors of, the
resulting or acquiring corporation (which shall include, without limitation, a
corporation which as a result of the Business Combination owns the Company or
substantially all of the Company’s assets either directly or through one or more
subsidiaries), and

 
(B)  
such post-transaction beneficial ownership is in substantially the same
proportions as their ownership, immediately prior to such Business Combination,
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities, respectively.

 
(iv)  
approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

 
 
“Disability” means a mental or physical condition or accident, which results in
the Executive being unable to perform his material duties hereunder for a period
of three consecutive months, as reasonably determined by a majority of the
disinterested members of the Board.
 
 
“Good Reason” means the occurrence, without the Executive’s written consent, of
any of the events or circumstances set forth in clauses (i) through (iii) below,
provided that the Executive has given the Company written notice describing in
reasonable detail the event or circumstance that she believes constitutes Good
Reason and the Company has not cured it within 30 days after its receipt of such
notice.
 
(i)  
the assignment to the Executive of duties inconsistent in any material respect
with his executive position with the Company, or any other action or omission by
the Company which results in a material diminution in such position, authority,
title or responsibilities or any change in reporting relationship, or the
relocation of the Executive’s principal base of operation to more than 50 miles
from Cincinnati, Ohio without his consent;

 
(ii)  
a reduction in the Executive’s Base Salary or as the same was or may be
increased thereafter from time to time;

 
(iii)  
the failure by the Company to:

 
(A)  
continue in effect any material compensation or benefit plan or program (a
“Benefit Plan”) in which the Executive participates, unless an equitable
arrangement (embodied in an ongoing substitute or alternative plan) has been
made with respect to such plan or program;

 
(B)  
continue the Executive’s participation therein (or in such substitute or
alternative plan) on a basis that is, both in the amount of benefits provided
and the level of the Executive’s participation relative to other participants,
materially equal to or more favorable than the basis existing on the Effective
Date;

 
(C)  
the failure of the Company to obtain the agreement from any successor to the
Company to continue to provide the Executive with the material compensation and
benefits described in Sections 4 and 10 of this Agreement;

 
(D)  
any failure of the Company to pay or provide to the Executive any portion of his
compensation or benefits due under any Benefit Plan within seven days of the
date such compensation or benefits are due; or

 
(E)  
any other material breach by the Company of this Agreement that is not cured
within 30 days of notice specifying the nature of the breach.

 
 
 
 
 
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(c) Payments Upon Termination.
 
(i)           With Cause or Without Good Reason.  If the Executive’s engagement
hereunder is terminated by the Company with Cause or by the Executive without
Good Reason, the Company shall have no further obligation to make any payments
or provide any benefits to the Executive hereunder after the date of termination
except for (A) payments of Base Salary, any awarded but unpaid Bonus for any
prior completed year, and expense reimbursement that had accrued but had not
been paid prior to the date of termination, (B) payments for any accrued but
unused vacation time, and (C) any benefits due through the date of termination
in accordance with the terms of the Benefit Plans.  Any amounts payable under
this Section 10(c)(i) shall be paid within five business days of the termination
date.
 
(ii)           Without Cause or For Good Reason.   If the Executive’s engagement
hereunder is terminated by the Company without Cause or by the Executive for
Good Reason, the Executive shall receive the following: (A) the payments and
benefits described in Section 10(c)(i) above, (B) all of the Executive’s
Time-Vested Options shall immediately vest and become exercisable in full (and
shall remain exercisable for three years after such termination), (C) a Bonus
for the current year through the date of termination that shall equal, pro rata,
the Bonus awarded to the Executive for the most recent completed year, and (D)
until the earliest to occur of (x) 12 months following the date of termination,
or (y) the end of the Term then in effect immediately prior to the termination
(the “Severance Period”), (1) Base Salary payable during the Severance Period at
the rate in effect at the date of termination, (2) a Bonus for such severance
period that shall equal, subject to pro rata adjustment if the Severance Period
is less than 12 months, the Bonus awarded to the Executive for the most recent
completed year, and (3) continuance at the Company’s expense of the Executive’s
medical and dental insurance coverage in accordance with the terms of the then
existing Company benefit plans (but only to the extent the Executive is allowed
by such benefit plans and by law to continue participation in such benefit
plans, and if such continuation is not allowed, the Company shall provide the
Executive with commensurate insurance coverage at its expense).  Subject to
Section 10(f), any amounts payable under subsections (C) and (D) above shall be
paid as follows:  50% within five business days of the termination date and 50%
within six months of the termination date.
 
(iii)           Death or Disability.  If the Executive’s engagement hereunder is
terminated because of death or Disability, he (or his representatives) shall be
entitled to all of the payments and benefits described in Section 10(c)(ii) as
if the Executive’s engagement hereunder were terminated without Cause, except
that no payments shall be made under Section 10(c)(ii)(D).
 
(iv)           Change in Control.  If (A) a Change in Control occurs prior to
the expiration of the Term, (B) the Executive’s engagement with the Company or
its successor is terminated prior to the expiration of the Term and (C) it is
reasonably demonstrated by the Executive that such termination of engagement (1)
was at the request of a third party who has taken steps reasonably calculated to
effect a Change in Control or (2) otherwise arose in anticipation of or as a
result of a Change in Control, the Executive shall be entitled to the
compensation and benefits she would receive under Section 10(c)(ii) above
(except that the pre and post termination Bonus shall be based on the target
amount in effect on the date of termination) as if he were terminated without
Cause.
 
(d) Excise Tax Provisions.
 
(i)           In the event that any payment or benefit received or to be
received by the Executive with respect to any stock option, restricted stock or
stock unit, stock appreciation right, bonus or other incentive compensation plan
or agreement (collectively “Incentive Payments”), or any payments or benefits
under any severance or other plan, arrangement or agreement of the Company or
any of its affiliates (“Other Payments” and, together with the Incentive
Payments, the “Payments”) would be subject to the excise tax imposed by Section
4999 of the Code (the “Excise Tax”), the Company shall pay to Executive an
additional amount (the “Gross-Up Payment”) such that the net amount retained by
the Executive, after deduction of all Excise Taxes on the Payments, and all
Excise Taxes, federal, state and local income taxes, and federal employment
taxes on the Gross-Up Payment, and any interest, penalties or additions to tax
payable by Executive with respect thereto, shall be equal to the total present
value (using the applicable federal rate (as defined in Section 1274(d) of the
Code in such calculation) of the Payments at the time such Payments are to be
made.
 
 
 
 
 
 
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(ii)           For purposes of determining whether any of the Payments will be
subject to the Excise Tax, such determination shall be initially made by tax
counsel selected by the Company.  For purposes of determining the amount of the
Gross-Up Payment, the Executive shall be deemed to pay federal income taxes at
the highest marginal rates of federal income taxation applicable to individuals
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rates of taxation applicable to
individuals as are in effect in the state and locality of the Executive’s
residence in the calendar year in which the Gross-Up Payment is to be made, net
of the maximum reduction in federal income taxes that can be obtained from
deduction of such state and local taxes, taking into account any limitations
applicable to individuals subject to federal income tax at the highest marginal
rates.
 
(iii)           The Gross-Up Payments provided for in this Section 10(d) shall
be made upon the earlier of (i) the payment to the Executive of any Payment or
(ii) the imposition upon the Executive or payment by the Executive of any Excise
Tax upon any Payment.  If it is established pursuant to a final determination of
a court or an Internal Revenue Service proceeding or the opinion of tax counsel
that the Excise Tax is less than the amount taken into account under this
Section 10(d), the Executive shall repay to the Company within thirty (30) days
of the Executive’s receipt of notice of such final determination or opinion the
portion, of the Gross-Up Payment attributable to such reduction (plus the
portion of the Gross-Up Payment attributable to the Excise Tax and federal,
state and local income tax imposed on the Gross-Up Payment being repaid by the
Executive, if such repayment results in a reduction in Excise Tax or a federal,
state and local income tax deduction) plus any interest received by the
Executive on the amount of such repayment.  If it is established pursuant to a
final determination of a court, an Internal Revenue Service proceeding, or the
opinion of tax counsel that the Excise Tax exceeds the amount taken into account
hereunder (including by reason of any payment the existence or amount of which
cannot be determined at the time of the Gross-Up Payment), the Company shall
make an additional Gross-Up Payment in respect of such excess within thirty (30)
days of the Company’s receipt of notice of such final determination or opinion.
 
(e) Conditions to Payment.  The obligation to make payments or provide benefits
under Section 10(c)(ii) or (iv) of this Agreement shall be contingent upon the
Executive executing a customary general release in form and substance reasonably
acceptable to the Company and the Executive, it being understood that the
Executive shall not be required to relinquish any benefits to which the
Executive is entitled hereunder or pursuant to any director or officer
indemnification provided by the Company.  The Company’s obligations hereunder to
pay any premiums for medical or dental insurance benefits shall cease if the
Executive is eligible to receive similar benefits from another employer.  The
Executive shall notify the Company promptly in writing of any such benefits
earned or to be earned from another employer.
 
(f) Cessation of Payments.  If the Executive breaches his obligations under
Sections 6 or 7 of this Agreement in any material respect, the Company may,
following 30 days prior written notice to the Executive specifying such breach
and a reasonable opportunity to cure such breach and/or to be heard by the
Board, cease all payments payable to, or on behalf of, the Executive under
Sections 10(c)(ii)(C) and (D) of this Agreement and the Company shall be
entitled to recover all prior payments made to the Executive under Sections
10(c)(ii)(C) and (D) of this Agreement.  The cessation of these payments shall
be in addition to, and not as an alternative to, any other remedies at law or in
equity available to the Company, including without limitation the right to seek
specific performance or an injunction.
 
(g) Survival.  The provisions of Sections 5 through 24 of this Agreement shall
survive the term of this Agreement and the termination of the Executive’s
engagement hereunder with the Company, and shall continue thereafter in full
force and effect in accordance with their respective terms.
 
11. Enforceability, etc.  This Agreement shall be interpreted in such a manner
as to be effective and valid under applicable law, but if any provision hereof
shall be prohibited or invalid under any such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating or nullifying the remainder of such provision or any other
provisions of this Agreement.  If any one or more of the provisions contained in
this Agreement shall for any reason be held to be excessively broad as to
duration, geographical scope, activity or subject, such provisions shall be
construed by limiting and reducing it so as to be enforceable to the maximum
extent permitted by applicable law.
 
 
 
 
 
 
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12. Notices.  Any notice, demand or other communication given pursuant to this
Agreement shall be in writing and shall be personally delivered, sent by
nationally recognized overnight courier or express mail, or mailed by first
class certified or registered mail, postage prepaid, return receipt requested as
follows:
 
If to the Executive:

Stephen S. Burns
c/o AMP Holdings, Inc.
4540 Alpine Avenue
Blue Ash, Ohio 45252

 
If to the Company:
 
AMP Holdings, Inc.
4540 Alpine Avenue
Blue Ash, Ohio 45252
Attention:  Chairman, Compensation Committee of Board of Directors

With a copy to:
Joseph S Paresi, Chairman
AMP Holding Inc.
20 Pond Lane
Armonk, NY 10504
914-643-5251
paresi@aol.com

and
Stephen M. Fleming
Law Offices of Stephen M. Fleming PLLC

49 Front Street, Suite 206
Rockville Centre, New York  11570
Phone 516-833-5034 
Fax 516-977-1209
email: smf@flemingpllc.com
 
 
 
or at such other address as may have been furnished by such person in writing to
the other party.
 
13. Governing Law.  This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Ohio without regard to its
choice of law provisions.
 
14. Amendments and Waivers.  This Agreement may be amended or modified only by a
written instrument signed by the Company and the Executive.  No waiver of this
Agreement or any provision hereof shall be binding upon the party against whom
enforcement of such waiver is sought unless it is made in writing and signed by
or on behalf of such party.  The waiver of a breach of any provision of this
Agreement shall not be construed as a waiver or a continuing waiver of the same
or any subsequent breach of any provision of this Agreement.  No delay or
omission in exercising any right under this Agreement shall operate as a waiver
of that or any other right.
 
15. Binding Effect.  This Agreement shall be binding on and inure to the benefit
of the parties hereto and their respective heirs, executors and administrators,
successors and assigns, except that the rights and obligations of the Executive
are personal and may not be assigned without the Company’s prior written
consent.  Any assignment of this Agreement by the Company shall not constitute a
termination of the Executive’s engagement hereunder.
 
 
 
 
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16. Entire Agreement.  This Agreement constitutes the final and entire agreement
of the parties with respect to the matters covered hereby and replaces and
supersedes all other agreements and understandings relating to the subject
matter contained herein.
 
17. Directors’ and Officers’ Insurance; Indemnification.
 
(a) The Company shall provide the Executive with (i) the coverage applicable to
the officers of the Company under the Company’s policies of directors’ and
officers’ insurance as may be in effect from time to time, and (ii) the most
favorable indemnification that the Company from time to time extends to any of
its officers or directors, whether under the Company’s by-laws, Certificate of
Incorporation, by contract or otherwise.
 
(b) The Company shall amend its directors’ and officers’ liability insurance
policy to add the Executive as a named insured under such policy.
 
(c) For so long as the Executive serves as an officer or director of the
Company, the Company shall maintain directors’ and officers’ liability insurance
with an insurer which maintains a rating of not less than A- by Fitch or A.M.
Best with at least the current level of coverage.
 
18. Representations and Warranties of the Executive.  The Executive represents
and warrants to the Company that, as of the date hereof, neither his execution
and delivery of this Agreement nor the performance of his obligations hereunder
will conflict with, violate or result in a breach of any agreement or obligation
to which she is a party or by which she is bound.
 
19. Representations and Warranties of the Company.  The Company represents and
warrants to the Executive that, as of the date hereof:
 
(a)           it is duly organized, validly existing and in good standing under
the laws of the jurisdiction in which it is formed and has all requisite
organizational authority to own its property and assets and to conduct its
business as presently conducted or proposed to be conducted under this
Agreement;

(b)           it has the organizational power and authority to execute, deliver
and perform its obligations under this Agreement;

(c)           all necessary action has been taken to authorize its execution,
delivery and performance of this Agreement and this Agreement constitutes its
legal, valid and binding obligation enforceable against it in accordance with
its respective terms, except as such enforcement may be limited by applicable
bankruptcy, insolvency, moratorium and other similar laws affecting the rights
of creditors generally and by general principles of equity;

(d)           neither its execution and delivery of this Agreement nor the
performance of its obligations hereunder will:

(i)           conflict with or violate any provision of its certificate of
incorporation or by-laws or equivalent organizational documents;

(ii)           conflict with, violate or result in a breach of any constitution,
law, judgment, regulation or order of any governmental authority applicable to
it; or

(iii)           conflict with, violate or result in a breach of or constitute a
default under or result in the imposition or creation of any mortgage, pledge,
lien, security interest or other encumbrance under any term or condition of any
mortgage, indenture, loan agreement or other agreement to which it is a party or
by which its properties or assets are bound;

(e)           no approval, authorization, order or consent of, or declaration,
registration or filing with any governmental authority or third party is
required for its valid execution, delivery and performance of this Agreement,
except such as have been duly obtained or made; and

(f)           there is no action, suit or proceeding, at law or in equity, by or
before any court, tribunal or governmental authority or third party pending, or,
to its knowledge, threatened, which, if adversely determined, would materially
and adversely affect its ability to perform its obligations hereunder or the
validity or enforceability of this Agreement.
 
 
 
 
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20. Counterparts.  This Agreement may be executed in any number of counterparts,
including counterpart signature pages or counterpart facsimile signature pages,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
 
21. Review of Agreement.  Each party hereto acknowledges that she or it (a) has
carefully read and understands all of the provisions of this Agreement and has
had the opportunity for this Agreement to be reviewed by counsel, (b) is
voluntarily entering into this Agreement and (c) has not relied upon any
representation or statement made by the other party (or its affiliates, equity
holders, agents, representatives, employees and attorneys) with regard to the
subject matter or effect of this Agreement.  The Executive also acknowledges
that his compliance with certain of the provisions of this Agreement is
necessary to protect the goodwill, customer relationships and Confidential
Information of the Company and each Related Company.
 
22. Captions.  The captions of the sections of this Agreement are for
convenience of reference only and in no way define, limit or affect the scope or
substance of any section of this Agreement.
 
23. No Strict Construction.  The parties hereto have participated jointly in the
negotiation and drafting of this Agreement.  In the event an ambiguity or
question of intent or interpretation arises under any provision of this
Agreement, this Agreement shall be construed as if drafted jointly by the
parties thereto, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of authoring any of the provisions of this
Agreement.
 
24. Notification of New Employer.  In the event that the Executive is no longer
providing services to the Company under this Agreement, the Executive consents
to notification by the Company to the Executive’s new employer or its agents
regarding the Executive’s rights and obligations under this Agreement.
 
[Signature Page Follows]
 

 
 
 
 
 
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This Agreement has been executed and delivered as a sealed instrument as of the
date first above written.
 
 

  AMP Holding Inc          
Date: December 8, 2010     
 
/s/ Joseph S. Paresi      
By: Joseph S. Paresi
     
Title: Chairman of the Board
                                   Date: December 8, 2010   /s/ Stephen S. Burns
      Stephen S. Burns                          

 
                                

 
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Exhibit A
 
AMP Holding Inc. – Fringe Benefits

To be determined by the Board of Directors
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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