**EXECUTIVE
EMPLOYMENT AGREEMENT**
 
 EMPLOYMENT
AGREEMENT (the "Agreement"), dated as of March __, 2005, between ENERGY &
ENGINE TECHNOLOGY CORPORATION, a Nevada corporation (the "Company"), and
____________________________________ (the "Executive").
 
 WHEREAS,
the Company desires to provide for the continued services and employment of the
Executive with the Company and the Executive wishes to provide such services and
to continue his employment with the Company, all in accordance with the terms
and conditions provided herein.
 
 NOW,
THEREFORE, in consideration of the premises and the respective covenants and
agreements of the parties herein contained, and intending to be legally bound
hereby, the parties hereto agree as follows:
 
 1.
    EMPLOYMENT.
      The Company hereby agrees to employ the Executive, and the Executive
      hereby agrees to be employed by and to serve the Company, effective as of
      March 1, 2005 (the "Effective Date"), on the terms and conditions set
      forth herein.
 
 2.
    TERM.
      The term of this Agreement shall commence on the Effective Date hereof and
      terminate on February 28, 2010, unless further extended or sooner
      terminated as provided in this Agreement. Commencing on February 28, 2010,
      and on each anniversary of such date thereafter (each date, an
      "Anniversary Date"), the term of the Executive's employment shall
      automatically be extended for one additional year, unless not later than
      six months prior to such Anniversary Date either party shall have given
      notice (a "Nonrenewal Notice") to the other party that it does not wish to
      extend this Agreement. References hereinafter to the "Term" of this
      Agreement shall refer to both the initial term and any extended term of
      the Agreement hereunder. Notwithstanding expiration of the Term or other
      provisions that survive by their intent, the provisions of Paragraphs
      3(b), 9 and 10 hereof shall continue in
effect.
 
 3.
    NATURE
      OF PERFORMANCE.
 
 (a)
    POSITION
      AND DUTIES. The Executive shall serve as Chief Executive Officer and
      President of the Company and shall have such responsibilities, duties and
      authority consistent with such positions as may from time to time be
      determined by the Board of Directors of the Company (the "Board"). The
      Executive shall report directly to the Board. The Executive shall devote
      substantially all of his working time to the business and affairs of the
      Company; provided that, this Agreement shall not be interpreted to
      prohibit the Executive from making passive investments, engaging in
      charitable activities or, subject to prior approval of the Board (which
      approval shall not be unreasonably withheld), serving on the board of
      directors of any other corporation.
 
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 (b)
    INDEMNIFICATION.
      To the fullest extent permitted by law and the Company's articles of
      incorporation and bylaws, the Company shall indemnify the Executive for
      all amounts (including, without limitation, judgments, fines, settlement
      payments, losses, damages, costs and expenses (including reasonable
      attorneys' fees)) incurred or paid by the Executive in connection with any
      action, proceeding, suit or investigation arising out of or relating to
      the performance by the Executive of services for, or acting as a fiduciary
      of any employee benefit plans, programs or arrangements of the Company or
      as a director, officer or employee of, the Company or any subsidiary
      thereof. Following the Term, the Company shall continue to indemnify the
      Executive with respect to such services performed during the Term, to the
      same extent as the Company indemnifies its officers, directors, employees
      and fiduciaries, as applicable. Executive shall be provided director and
      officer liability insurance coverage by the Company on the same terms and
      conditions as that being provided to any other director and officer of the
      Company from time to time during the Term
hereof.
 
 4.
    PLACE
      OF PERFORMANCE. In connection with the Executive's employment by the
      Company, the Executive shall be based at the principal executive offices
      of the Company in Plano, TX or at such other principal executive office in
      the Dallas Fort Worth Metroplex as the Company may hereafter maintain,
      except for required travel on the Company's business.
 
 5.
    COMPENSATION
      AND RELATED MATTERS.
 
 (a)
    ANNUAL
      COMPENSATION.
 
 (i)
    BASE
      SALARY. During the period of the Executive's employment hereunder, the
      Company shall pay to the Executive an annual base salary at a rate not
      less than $260,000, such salary to be paid in conformity with the
      Company's policies relating to salaried employees. This salary may be (but
      is not required to be)increased from time to time, subject to and in
      accordance with the annual executive performance review procedures of the
      Company and, if so increased, shall not thereafter be decreased during the
      Term of this Agreement. Compensation of the Executive by salary payments
      shall not be deemed exclusive and shall not prevent the Executive from
      participating in any other compensation or benefit plan of the Company.
      The salary payments (including any increased salary payments) hereunder
      shall not in any way limit or reduce any other obligation of the Company
      hereunder, and no other compensation, benefit or payment hereunder shall
      in any way limit or reduce the obligation of the Company to pay the
      Executive's salary hereunder.
 
  59
  
 (ii)
    ANNUAL
      BONUS. During the period of Executive's employment hereunder, the
      Executive shall be eligible to participate in the Company's annual bonus
      plan as in effect from time to time, and shall be entitled to receive such
      amounts (a "Bonus") as may be authorized, declared and paid by the Company
      pursuant to the terms of such plan; provided that, notwithstanding any
      contrary provisions of such bonus plan, unless the Executive's employment
      is terminated by the Company for Cause (as defined in Paragraph 6(c)
      hereof) or by the Executive other than for Good Reason, as defined in
      Paragraph 6(d)(1) hereof), the Executive shall be entitled to receive any
      Bonus paid with respect to any bonus period completed on or prior to the
      Date of Termination or, in the case a Nonrenewal Notice is given by the
      Company, through the scheduled expiration date of the Term (even if the
      Executive terminates his employment prior to such scheduled expiration
      date for Good Reason under Paragraph 6(d)(1)(v) hereof). The Company may
      maintain a Management Performance Compensation Plan (the "Performance
      Plan") pursuant to which it will pay performance bonus compensation to
      certain of its executives and employees. It is agreed that Executive shall
      participate in the Performance Plan. Executive's Performance Percentage
      (as that term is to be defined in the Performance Plan) shall be
      established at 80% per annum during the Term. Executive shall also
      participate in the Long Term Cash Incentive Compensation Plan to be
      maintained by the Company and his Target Award (as defined in such plan)
      shall be 50%.
 
 (b)
    STOCK
      OPTIONS/WARRANTS. The Executive will be granted a warrant/stock option
      equal to 25,000 shares per month, for each month commencing April 1,
      2005,with an exercise price of the closing price on the trading day
      immediately preceding the date of issuance, each with a term of five years
      from the date of issuance, with cashless exercise provisions, throughout
      the term of this Agreement that Executive remains continuously employed by
      the Company, which Options shall vest immediately upon
      receipt.The
      Company shall enter into Stock Option or Warrant Agreements with the
      Executive for the above stock option/warrant grants, incorporating the
      terms set forth above, and otherwise substantially on the terms and
      conditions set forth in the form of the Company's standard Stock
      Option/Warrant Agreement previously approved by the Board of
      Directors.
 
 (c)
    OTHER
      BENEFITS. During the period of Executive's employment hereunder, the
      Executive shall continue to be entitled to participate in all other
      employee benefit plans, programs and arrangements of the Company, as now
      or hereinafter in effect, which are applicable to the Company's employees
      generally or to its executive officers, as the case may be, including,
      additional executive stock option or deferred compensation plans, subject
      to and on a basis consistent with the terms, conditions and overall
      administration of such plans, programs and arrangements. During the period
      of Executive's employment hereunder, the Executive shall be entitled to
      participate in and receive any fringe benefits or perquisites which may
      become available to the Company's executive employees. Without limiting
      the generality of the foregoing, the Company shall provide the Executive
      with financial planning and tax preparation services on a tax-free
      basis.
 
 (d)
    VACATIONS
      AND OTHER LEAVES. The Executive shall be entitled to an aggregate paid
      vacation of not less than four (4) weeks for each twelve (12) month period
      of the Term hereof (or more, pursuant to Company policy). Payment for any
      accrued and unused vacation time at the time of termination of this
      Agreement shall be in accordance with the Company's policies at the time
      of such termination. The Executive shall be entitled to paid holidays and
      personal leave days in accordance with the Company policy covering
      executive employees.
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 (e)
    EXPENSES.
      During the period of the Executive's employment hereunder, the Executive
      shall be entitled to receive prompt reimbursement for all reasonable and
      customary expenses incurred by the Executive in performing services
      hereunder, including all expenses of travel and accommodations while away
      from home on business or at the request of and in the service of the
      Company; provided that, such expenses are incurred and accounted for in
      accordance with the policies and procedures established by the Company. It
      is understood and agreed by Executive that such reimbursement shall not
      cover expenses and costs incurred by him in connection with his commuting
      from his principal residence as described in Paragraph 4 of this
      Agreement.
 
 (f)
    SERVICES
      FURNISHED. The Company shall furnish the Executive with office space,
      stenographic assistance and such other facilities and services as shall be
      suitable to the Executive's position and adequate for the performance of
      his duties hereunder.
 
 6.
    TERMINATION.
      The Executive's employment hereunder may be terminated without breach of
      this Agreement only under the following
circumstances:
 
 (a)
    DEATH.
      The Executive's employment hereunder shall terminate upon his
      death.
 
 (b)
    DISABILITY.
      If, as a result of the Executive's incapacity due to physical or mental
      illness, the Executive shall have been absent from his duties hereunder on
      a full time basis for the entire period of six (6) consecutive months, and
      within thirty (30) days after written Notice of Termination (as defined
      below) is given (which may occur before or after the end of such six (6)
      month period) shall not have returned to the performance of his duties
      hereunder on a full-time basis, the Executive's employment hereunder shall
      terminate for "Disability."
 
 (c)
    CAUSE.
      The Company may terminate the Executive's employment hereunder for
      "Cause". For purposes of this Agreement, the Company shall have "Cause" to
      terminate the Executive's employment hereunder upon (i) the Executive's
      conviction for the commission of any act or acts constituting a felony
      under the laws of the United States or any state thereof, (ii) action by
      the Executive toward the Company involving dishonesty (other than good
      faith expense account disputes), (iii) the Executive's gross nonfeasance
      which does not cease within ten (10) business days after notice regarding
      such nonfeasance has been given to the Executive by the Company or (iv)
      failure of the Executive to comply with the provisions of Paragraph 9
      (prior to a cessation of employment following a Change in Control of the
      Company) or 10 of this Agreement.
 
 (d)
    TERMINATION
      BY THE EXECUTIVE.
 
 (1)
    The
      Executive may terminate his employment hereunder for "Good Reason". For
      purposes of this Agreement, the Executive shall have "Good Reason" to
      terminate his employment hereunder (i) upon a failure by the Company to
      comply with any material provision of this Agreement which has not been
      cured within ten (10) business days after notice of such noncompliance has
      been given by the Executive to the Company, (ii) upon action by the
      Company resulting in a diminution of the Executive's title or authority,
      (iii) upon the Company's relocation of the Executive's principal place of
      employment outside of the Dallas Metropolitan Area, (iv) one year after a
      "Change in Control of the Company" (as defined in Paragraph (d)(2) below)
      or (v) at any time following the expiration of ninety (90) days following
      the Company's issuance of a Nonrenewal Notice. The Executive may terminate
      his employment voluntarily without Good Reason upon at least three months'
      prior notice to the Company.
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 (2)
    For
      purposes of this Agreement, a "Change in Control of the Company" will be
      deemed to have occurred if:
 
 (A)
    any
      "person", as such term is used in Paragraphs 13(d) and 14(d) of the
      Securities Exchange Act of 1934, as amended (the "Exchange Act"), other
      than (1) any person who on the date hereof is a director or officer of the
      Company, (2) any trustee or other fiduciary holding securities under an
      employee benefit plan of the Company, or (3) any corporation owned,
      directly or indirectly, by the stockholders of the Company (in
      substantially the same proportion as their ownership of stock of the
      corporation) (a "Person") is or becomes the "beneficial owner" (as defined
      in Rule 13d-3 under the Exchange Act), directly or indirectly, of
      securities of the Company representing 20% or more of the combined voting
      power of the Company's then outstanding voting
  securities;
 
 (B)
    during
      any period of two consecutive years, individuals who at the beginning of
      such period constitute the Board, and any new director (other than a
      director designated by a person who has entered into an agreement with the
      Company to effect a transaction described in clause (A), (C) or (D) of
      this Paragraph 6(d)(2)) whose election by the Board or nomination for
      election by the Company's stockholders was approved by a vote of at least
      two-thirds (2/3) of the directors then still in office who either were
      directors at the beginning of the period or whose election or nomination
      for election was previously so approved, cease for any reason to
      constitute at least a majority thereof;
 
 (C)
    there
      is consummated a merger or consolidation of the Company with any other
      corporation, other than (1) a merger or consolidation which would result
      in the voting securities of the Company outstanding immediately prior
      thereto continuing to represent either by remaining outstanding or by
      being converted into voting securities of the surviving entity) more than
      80% of the combined voting power of the voting securities of the Company
      or such surviving entity outstanding immediately after such merger or
      consolidation or (2) a merger or consolidation effected to implement a
      recapitalization of the Company (or similar transaction) in which no
      Person is or becomes the beneficial owner (as defined in (A) above),
      directly or indirectly, of securities of the Company representing 20% or
      more of the combined voting power of the Company's then outstanding
      securities; or
 
 (D)
    the
      stockholders of the Company approve a plan of complete liquidation of the
      Company or an agreement for the sale or disposition by the Company of all
      or substantially all of the Company's
assets.
 
 (E)
    NOTICE
      OF TERMINATION. Any termination of the Executive's employment by the
      Company or by the Executive (other than termination under Paragraph 6(a)
      hereof) shall be communicated by written Notice of Termination to the
      other party hereto in accordance with Paragraph 12 hereof. For purposes of
      this Agreement, a "Notice of Termination" shall mean a notice which shall
      indicate the specific termination provision in this Agreement relied upon
      and shall set forth in reasonable detail the facts and circumstances
      claimed to provide a basis for termination of the Executive's employment
      under the provision to indicated.
 
  62
  
 (F)
    DATE
      OF TERMINATION. "Date of Termination" shall mean (i)if the Executive's
      employment is terminated by his death, the date of his death, (ii) if the
      Executive's employment is terminated pursuant to subparagraph (b) above,
      the date which is the later of thirty (30) days after Notice of
      Termination is given (provided that the Executive shall not have returned
      to the performance of his duties on a full-time basis during such thirty
      (30) day period) or the end of the six (6) consecutive month period
      referred to in subparagraph (b) above, and (iii) if the Executive's
      employment is terminated pursuant to subparagraph (c) or (d) above, the
      date specified in the Notice of Termination; provided that, if within
      thirty (30) days after any Notice of Termination is given the party
      receiving such Notice of Termination notifies the other party that a
      dispute exists concerning the termination, the Date of Termination shall
      be the date on which the dispute is finally determined, either by mutual
      written agreement of the parties or by a binding and final arbitration
      award.
 
 7.
    COMPENSATION
      UPON TERMINATION OR DURING DISABILITY.
 
 (a)
    DISABILITY.
      During any period that the Executive fails to perform his duties hereunder
      as a result of incapacity due to physical or mental illness, the Executive
      shall continue to receive his full salary at the rate then in effect for
      such period and other applicable benefits provided to active employees
      until his employment is terminated pursuant to Paragraph 6(b) hereof.
      Subject to the provisions of Paragraph 9 hereof, in the event the
      Executive's employment is terminated pursuant to Paragraph 6(b) hereof,
      then
 
 (i)
    as
      soon as practicable thereafter, the Company shall pay the Executive all
      unpaid amounts, if any, to which the Executive is entitled as of the Date
      of Termination under Paragraph 5(a)hereof and shall pay to the Executive,
      in accordance with the terms of the applicable plan or program, all other
      unpaid amounts to which Executive is then entitled under any compensation
      or benefit plan or program of the Company (collectively, "Accrued
      Obligations"); and
 
 (ii)
    following
      the Date of Termination and for a period of twelve (12) months thereafter
      (the "Disability Severance Period"), the Company shall pay the Executive
      monthly an amount equal to (x)the quotient of (A) the sum of (1) the
      Executive's annual base salary at the rate in effect as of the Date of
      Termination and (2) the average of the annual bonuses earned by the
      Executive in the three fiscal years of the Company ended immediately prior
      to the Date of Termination, divided by (B) the number twelve (12)(such
      quotient being referred to herein as the "Severance Payments"), minus (y)
      any amounts payable to the Executive during such month as a disability
      benefit under a Company paid plan.
 
 (b)
    DEATH.
      If the Executive's employment is terminated by his death, the Company
      shall pay to the person(s) or entity set forth in Paragraph 11(b) hereof
      the Accrued Obligations and the Severance Payments at the time(s) set
      forth in Paragraphs 7(a)(i)and 7 (a)(ii)
hereof.
 
  63
  
 (c)
    TERMINATION
      FOR CAUSE; VOLUNTARY TERMINATION WITHOUT GOOD REASON. If the Executive's
      employment is terminated by the Company for Cause or voluntarily by the
      Executive for other than Good Reason (including by reason of the
      expiration of the Term of this Agreement as a result of a Nonrenewal
      Notice having been given by the Executive), the Company shall pay the
      Accrued Obligations to the Executive at the time(s) set forth in Paragraph
      7(a)(i) hereof and the Company shall have no further obligations to the
      Executive under this Agreement.
 
 (d)
    TERMINATION
      WITHOUT CAUSE; TERMINATION FOR GOOD REASON; NONRENEWAL. If (i) the Company
      shall terminate the Executive's employment other than for Disability
      pursuant to Paragraph 6(b) or for Cause, (ii) the Executive shall
      terminate his employment for Good Reason, or (iii) the Term of this
      Agreement expires as a result of a Nonrenewal Notice having been provided
      by the Company, then, subject to the provisions of Paragraph 9
      hereof:
 
 (1)
    the
      Company shall pay the Accrued Obligations to the Executive at the time(s)
      set forth in Paragraph 7(a)(i) hereof;
 
 (2)
    (A)
      unless clause (B) below applies, then following the Date of Termination
      and for the longer of twelve months thereafter or the remaining Term of
      this Agreement, the Company shall pay to the Executive monthly an amount
      equal to the Severance Payments (as defined in Paragraph 7(a)(ii)hereof),
      or (B) in the event the Date of Termination occurs following a Change in
      Control, then, within five (5) days after the Date of Termination, the
      Company shall pay to the Executive in a lump sum an amount equal to the
      product of x) the sum of the Executive's base salary at the rate in effect
      as of the Date of Termination and the average of the annual bonuses earned
      by the Executive in the three fiscal years of the Company ended
      immediately prior to the Date of Termination(or, if higher, in the three
      fiscal years of the Company ended immediately prior to the Change in
      Control) multiplied by(y)the number three (3). For purposes of this
      subparagraph (2): (i) if the Date of Termination occurs prior to the
      occurrence of a Change in Control but during the pendency of a Potential
      Change in Control (as hereinafter defined), such Date of Termination shall
      be deemed to have occurred following a Change in Control and (ii) a
      "Potential Change in Control" shall be deemed to have occurred if the
      event set forth in any one of the following clauses shall have
      occurred:(i)
    the
      Company enters into an agreement, the consummation of which would result
      in the occurrence of a Change in Control;
 
 (ii)
    the
      Company or any Person (as defined in Paragraph 6(d)(2)(A)hereof)publicly
      announces an intention to take or to consider taking actions which, if
      consummated, would constitute a Change in
Control;
 
 (iii)
    any
      Person becomes the beneficial owner (as defined in Rule 13d-3 under the
      Exchange Act), directly or indirectly, of securities of the Company
      representing 15% or more either the then outstanding shares of common
      stock of the Company or the combined voting power of the Company's then
      outstanding securities(not including in the securities beneficially owned
      by such Person any securities acquired directly from the Company);
      or
 
  64
  
 (iv)
    the
      Board adopts a resolution to the effect that, for purposes of this
      subparagraph(2), a Potential Change in Control has
    occurred.The
      pendency of a Potential Change in Control shall immediately cease upon the
      adoption of a resolution of the Company's Board of Directors to that
      effect.
 
 (3)
    the
      Executive shall continue to be provided with the same medical and life
      insurance coverage as existed immediately prior to the applicable Notice
      of Termination or Notice of Nonrenewal, as the case may be, such coverage
      to continue throughout the period with respect to which the Executive is
      entitled to receive Severance Payments (or, if clause (B) of Paragraph
      7(d)(2) applies, for a period of three (3) years following the Date of
      Termination);
 
 (4)
    the
      Executive shall be provided with outplacement services commensurate with
      his position;
 
 (5)
    the
      Executive shall be entitled to continue to exercise all outstanding
      options that were or became exercisable as of the Date of Termination
      until the 90th day following expiration of the period with respect to
      which the Executive is entitled to receive Severance Payments (or, if
      clause (B)of Paragraph 7(d)(2)applies, following the third anniversary of
      the Date of Termination), but in no event after expiration of the term of
      such options;
 
 (6)
    any
      unvested stock options shall become fully vested and exercisable and any
      unvested restricted shares shall become fully vested;
  and
 
 (7)
    the
      Company shall pay the Executive, at the same time as bonuses are paid to
      other Company executives, a Bonus with respect to the fiscal year in which
      occurs the Date of Termination, such Bonus to be based upon actual
      performance for such fiscal year and pro rated to reflect the number of
      days in such fiscal year through and including the Date of
      Termination.
 
  65
  
 8.
    GROSS-UP
      PAYMENT. In the event that any payment or benefit received or to be
      received by the Executive in connection with a Change in Control of the
      Company or the termination of the Executive's employment, whether such
      payments or benefits are received pursuant to the terms of this Agreement
      or any other plan, arrangement or agreement with the Company, any person
      whose actions result in a Change in Control of the Company or any person
      affiliated with the Company or such person (all such payments and benefits
      being hereinafter called "Total Payments"), would be subject (in whole or
      part), to the tax (the "Excise Tax") imposed under Section 4999 of the
      Internal Revenue Code of 1986, as amended (the "Code"), the Company shall
      pay to the Executive such additional amounts (the "Gross-Up Payment") as
      may be necessary to place the Executive in the same after-tax position as
      if no portion of the Total Payments had been subject to the Excise Tax. In
      the event that the Excise Tax is subsequently determined to be less than
      the amount taken into account hereunder, the Executive shall repay to the
      Company, at the time that the amount of such reduction in Excise Tax is
      finally determined, the portion of the Gross-Up Payment attributable to
      the reduction (plus that 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 to the extent that such
      repayment results in a reduction in Excise Tax and/or federal, state or
      local income tax deduction) plus interest on the amount of such repayment
      at the rate provided in Section 1274(b)(2)(B) of the Code. In the event
      that the Excise Tax is determined to exceed the amount taken into account
      hereunder (including by reason of any payment the existence 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 (plus
      any interest, penalties or additions payable by the Executive with respect
      of such excess) at the time that the amount of such excess if finally
      determined. The Executive and the Company shall each reasonably cooperate
      with the other in connection with any administrative or judicial
      proceedings concerning the existence or amount of liability for Excise Tax
      with respect to the Total Payments.
 
 9.
    NONSOLICITATION;
      NONCOMPETE.
 
 (a)
    Subject
      to (c) below, during the period of Executive's employment, during the
      period he is receiving Severance Payments hereunder and, in the case where
      the Executive's employment is terminated for Cause or Executive
      voluntarily terminates his employment without Good Reason, for a period of
      twelve (12) months following such termination, the Executive shall not
      initiate discussions (of a non-isolated nature) with any person who is
      then an executive employee of the Company (i.e., director level or above)
      with the intent of soliciting or inducing such person to leave his or her
      employment with a view toward joining the Executive in the pursuit of any
      business activity (whether or not such activity involves engaging or
      participating in a Competitive Business (as defined below)).
      Notwithstanding any other provision of this Agreement to the contrary, in
      the event Executive fails to comply with the preceding sentence, all
      rights of the Executive and his surviving spouse or other beneficiary
      hereunder to any future Severance Payments and continuing life insurance
      and medical coverage and all rights with respect to restricted stock and
      exercisability of stock options shall be forfeited; provided that, the
      foregoing shall not apply if such failure of compliance commences
      following a Change in Control of the
Company.
 
  66
  
 (b)
    Subject
      to (c) below, as long as Executive receives Severance Payments, or in the
      case where the Executive's employment is terminated for Cause or Executive
      voluntarily terminates his employment without Good Reason, for a period of
      twelve (12) months following such termination, Executive shall not,
      without the prior written consent of the Company (which consent shall not
      be unreasonably withheld), engage or participate in any business which is
      "in competition" (as defined below) with the business of the Company or
      any of its 50% or more owned affiliates (such business being referred to
      herein as a "Competitive Business"). Notwithstanding any other provision
      of this Agreement to the contrary, in the event the Executive fails to
      comply with the preceding sentence, all rights of the Executive and his
      surviving spouse or other beneficiary hereunder to any future Severance
      Payments and continuing life insurance and medical coverage and all rights
      with respect to restricted stock and exercisability of stock options shall
      be forfeited; provided that, the foregoing shall not apply if such failure
      of compliance commences following a Change in Control of the
      Company.
 
 (c)
    In
      the event of a violation of Paragraphs 9(a) or 9(b) hereof, the remedies
      of the Company shall be limited to (i) if such violation occurs during the
      period of Executive's employment hereunder, termination of the Executive
      for Cause and the associated rights of the Company specified herein
      resulting therefrom, (ii) regardless of when such violation occurs,
      forfeiture by the Executive of the payments and benefits set forth in
      paragraphs (a) and (b) above if and to the extent provided in such
      paragraphs, and (iii) the right to seek injunctive relief in accordance
      with and to the extent provided in Paragraph 16 hereof; provided, such
      injunctive relief may only be sought for competitive activity under
      Paragraph (b) above if such activity occurs during employment or after
      Executive's dismissal for Cause or Executive voluntarily terminates his
      employment without Good Reason.
 
 (d)
    For
      purposes hereof, a business will be "in competition" with the business of
      the Company or its 50% or more owned affiliates only if (i) the Company's
      business with which the other business competes accounted for 20% or more
      of the Company's consolidated revenues as of the end of its most recently
      completed fiscal year prior to the Date of Termination, and (ii) the
      entity (including all 50% or more owned affiliates) through which the
      other business is or will be operated maintains a truck auxiliary power
      unit business which generated at least $50 million in revenues during the
      entity's most recently completed fiscal year ended prior to the date the
      Executive commences (or proposes to commence) to engage or participate in
      the other business.
 
 (e)
    Notwithstanding
      the foregoing, the Executive's engaging in the following activities shall
      not be construed as engaging or participating in a Competitive Business:
      (i) investment banking; (ii) passive ownership of less than 5% of any
      class of securities of a public company; (iii) engaging or participating
      in noncompetitive businesses of an entity which also operates a business
      which is "in competition" with the business of the Company or its
      affiliates; (iv) serving as an outside director of an entity which
      operates a business which is "in competition" with the business of the
      Company or its affiliates, so long as such business did not account for
      10% or more of the consolidated revenues of such entity as of the end of
      its most recently completed fiscal year prior to the date Executive
      commences (or proposes to commence) serving as a outside director; (v)
      engaging in a business involving licensing arrangements so long as such
      business is not an in-house arrangement for any entity "in competition"
      with the business of the Company or its affiliates; or (vi) affiliation
      with a law firm, if a lawyer, or with an accounting firm, if a
      CPA.
 
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 10.
    PROTECTION
      OF CONFIDENTIAL INFORMATION.
 
 (a)
    Executive
      acknowledges that his employment by the Company will, throughout the Term
      of this Agreement, involve his obtaining knowledge of confidential
      information regarding the business and affairs of the Company. In
      recognition of the foregoing, the Executive covenants and agrees
      that:
 
 (i)
    except
      in compliance with legal process, he will keep secret all confidential
      matters of the Company which are not otherwise in the public domain and
      will not intentionally disclose them to anyone outside of the Company,
      wherever located (other than to a person to whom disclosure is reasonably
      necessary or appropriate in connection with the performance by Executive
      of his duties as an executive officer of the Company), either during or
      after the Term, except with the prior written consent of the Board or a
      person authorized thereby; and
 
 (ii)
    he
      will deliver promptly to the Company on termination of his employment, or
      at any other time the Company may so request, all memoranda, notes,
      records, customer lists, reports and other documents (and all copies
      thereof) relating to the business of the Company which he obtained while
      employed by, or otherwise serving or acting on behalf of, the Company and
      which he may then possess or have under his
control.
 
 (b)
    Notwithstanding
      the provisions of Paragraph 16 of this Agreement, if the Executive commits
      a breach of the provisions of Paragraphs 10(a)(i) or 10(a)(ii), the
      Company shall have the right and remedy to have such provisions
      specifically enforced by any court having equity jurisdiction, it being
      acknowledged and agreed that any such breach or threatened breach will
      cause irreparable injury to the Company and that money damages will not
      provide an adequate remedy to the Company.
 
 11.
    SUCCESSORS;
      BINDING AGREEMENT.
 
 (a)
    Neither
      this Agreement nor any rights hereunder shall be assignable or otherwise
      subject to hypothecation by the Executive (except by will or by operation
      of the laws of intestate succession) or by the Company, except that the
      Company will require any successor (whether direct or indirect, by
      purchase, merger, consolidation or otherwise) to all or substantially all
      of the business and/or assets of the Company, by agreement in form and
      substance reasonably satisfactory to the Executive, to expressly assume
      and agree to perform this Agreement in the same manner and to the same
      extent that the Company would be required to perform it if no such
      succession had taken place. Failure of the Company to obtain such
      assumption and agreement prior to the effectiveness of any such succession
      shall be a breach of this Agreement and shall entitle the Executive to
      compensation from the Company in the same amount and on the same terms as
      he would be entitled to hereunder if he terminated his employment for Good
      Reason, except that for purposes of implementing the foregoing, the date
      on which any such succession becomes effective shall be deemed the Date of
      Termination. As used in this Agreement, "Company" shall mean the Company
      as herein before defined and any successor to its business and/or assets
      as aforesaid which executes and delivers the agreement provided for in
      this Paragraph 11 or which otherwise becomes bound by all the terms and
      provisions of this Agreement by operation of
law.
 
  68
  
 (b)
    This
      Agreement and all rights of the Executive hereunder shall inure to the
      benefit of and be enforceable by the Executive's personal or legal
      representatives, executors, administrators, successors, heirs,
      distributes, devises and legatees. If the Executive should die while any
      amounts would still be payable to him hereunder if he had continued to
      live, all such amounts, unless otherwise provided herein, shall be paid in
      accordance with the terms of this Agreement to the Executive's devisee,
      legatee, or other designee or, if there be no such designee, to the
      Executive's estate.
 
 12.
    NOTICE.
      For the purposes of this Agreement, notices, demands and all other
      communications provided for in this Agreement shall be in writing and
      shall be deemed to have been duly given when personally delivered to the
      Executive or an executive officer of the Company, mailed by United States
      certified or registered mail, return receipt requested, postage prepaid,
      or by overnight courier service, to the address as
  follows:If
      to the Company:
 
 Energy
      & Engine Technology Corporation5308
      West Plano ParkwayPlano,
      TX 75093(972)
      732-6360 ph(972)
      732-6440 fAttn:
      General Counsel
 
 If
      to the Executive:
 
 
 
 or
      to such other address as any party may have furnished to the other in
      writing in accordance herewith, except that notices of change of address
      shall be effective only upon receipt.
 
 13.
    MISCELLANEOUS.
      No provisions of this Agreement may be modified, waived or discharged
      unless such waiver, modification or discharge is agreed to in a writing
      signed by the Executive and such officer of the Company as may be
      specifically designated by the Board. No waiver by either party hereto at
      any time of any breach by the other party hereto of, or compliance with,
      any condition or provision of this Agreement to be performed by such other
      party shall be deemed a waiver of similar or dissimilar provisions or
      conditions at the same or at any prior or subsequent time. No agreements
      or representations, oral or otherwise, express or implied, with respect to
      the subject matter hereof have been made by either party which are not set
      forth expressly in this Agreement. The validity, interpretation,
      construction and performance of this Agreement shall be governed by the
      laws of the State of Texas without regard to its conflicts of law
      principles.
 
 14.
    VALIDITY.
      The invalidity or unenforceability of any provision or provisions of this
      Agreement shall not affect the validity or enforceability of any other
      provision of this Agreement, which shall remain in full force and
      effect.
 
 15.
    COUNTERPARTS.
      This Agreement may be executed in one or more counterparts and by
      facsimile signature each of which shall be deemed to be an original but
      all of which together will constitute one and the same
      instrument.
 
  69
  
 16.
    ARBITRATION.
      Any dispute or controversy arising under or in connection with this
      Agreement shall be settled exclusively by arbitration conducted before a
      panel of three arbitrators in Plano, Texas in accordance with the rules of
      the American Arbitration Association then in effect. Judgment may be
      entered on the arbitrator's award in any court having jurisdiction;
      provided that, the Company shall be entitled to seek a restraining order
      or injunction in any court of competent jurisdiction to prevent any
      continuation of any violation of the provisions of Paragraph 9 of the
      Agreement during the period of Executive's employment or following
      Executive's termination of employment for Cause or the voluntary
      termination of employment by Executive without Good Reason or of Paragraph
      10 of this Agreement at any time, and the Executive hereby consents that
      such restraining order or injunction may be granted without the necessity
      of the Company's posting any bond; and further provided that, the
      Executive shall be entitled to seek specific performance of his right to
      be paid until the Date of Termination during the pendency of any dispute
      or controversy arising under or in connection with this Agreement. The
      Company shall pay directly or reimburse the Executive for any legal fees
      incurred by Executive in connection with any arbitration related to the
      last proviso of the preceding sentence and any other arbitration in which
      he prevails.
 
 17.
    ENTIRE
      AGREEMENT. This Agreement sets forth the entire agreement of the parties
      hereto in respect of the subject matter contained herein and supersedes
      any and all other prior agreements, promises, covenants, arrangements,
      communications, representations or warranties, whether oral or written, by
      any officer, employee or representative of any party
    hereto.
 
 
 IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date and
year first above written.
 
 ENERGY
      & ENGINE TECHNOLOGY CORPORATION
 
 By:Name:Title:
 
 EXECUTIVE
 
 Signature:Printed
      Name:
 
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