Unassociated Document


    EMPLOYMENT
      SEPARATION AGREEMENT

     

    This
      Employment Separation Agreement (“Agreement”) is entered into as of February 1,
      2008, by and between Neah Power Systems, Inc., a Nevada corporation (“Company”),
      and Paul Abramowitz (“Executive”).

     

    RECITALS

     

    A. The
      parties entered into an Employment Agreement (“Employment Agreement”) as of
      August 8, 2007.

     

    B. As
      of the
      date hereof, the Board of Directors of the Company has appointed Chris D’Couto
      as President and Chief Executive Officer of the Company, and has appointed
      Executive Chairman of the Board.

     

    C. Executive
      has agreed to resign for “Good Reason” as defined in the Employment Agreement,
      on the terms and conditions set forth herein.

     

    AGREEMENT

     

    1. Executive
      hereby resigns for Good Reason effective February 1, 2008, and agrees to defer
      payment of the lump sum, which both parties hereby acknowledge and agree is
      due
      to Executive pursuant to Section 5.2(b) of the Employment Agreement, until
      the
      earlier of:

    
       

      
        	 	
                (a)

              	
                Company
                  undergoing a Change in Control,

              


      

       

    

    
      	 	
              (b)

            	
              Executive
                ceasing to be Chairman of the Board of Directors of Company for any
                reason, or

            


    

     

    
      	 	
              (c)

            	
              One
                year after the effective date of Executive’s resignation, unless extended
                by mutual agreement.

            


    

     

    2. With
      respect to the benefits, which both parties hereby acknowledge and agree are
      due
      to Executive pursuant to Sections 3.6(b) and 5.2(d) of the Employment Agreement,
      Executive’s spouse and any dependent children shall be covered under Company’s
      health care and dental plan[s] at Company’s cost. 

     

    3. Each
      party hereby fully and completely releases, discharges and holds harmless the
      other party, and its past and present officers, directors, partners, employees,
      agents, attorneys and assigns, whether acting in their representative or
      individual capacities, from any and all claims, causes of action, rights and
      actions of any kind or nature whatsoever, either at law or in equity, including
      without limitation all claims of negligence, wrongful termination, breach of
      contract, or breach of fiduciary duty, and all claims in any way arising out
      of
      or relating to Executive’s service as President or Chief Executive Officer of
      Company.

     

    4. It
      is the
      parties’ intention to fully, finally and forever settle, release and resolve all
      claims, regardless of whether known or unknown, foreseen or unforeseen,
      suspected or unsuspected, vested or contingent, accrued or unaccrued. The
      releases given herein shall be and remain in effect to their full extent,
      notwithstanding the discovery or existence of any additional or different facts.
      Both parties knowingly and voluntarily waives the provisions of California
      Civil
      Code section 1542, which provides: “A general release does not extend to claims
      which the creditor does not know or suspect to exist in his or her favor at
      the
      time of executing the release, which if known by him or her must have materially
      affected his or her settlement with the debtor.”

     

    5. Nothing
      provided for herein shall in any way affect: (i) the parties rights and
      obligations under the Employment Agreement, except as amended by Sections 1
      and
      2 above; (ii) Executive’s ongoing rights as a stockholder of the Company; or
      (iii) Executive’s ongoing rights and responsibilities as a member of the Board
      of Directors.

     

    This
      Agreement supersedes all previous or contemporaneous written or oral agreements
      or understandings between the parties, and may not be modified except in writing
      signed by parties and approved by the Board of Directors of
      Company.

     

    
      
         

      

      
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    IN
      WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
      day
      and year first above written.

     

    
      	EXECUTIVE:	 	 	NEAH
              POWER
              SYSTEMS, INC.
	 	 	 	 
	 	 	 	 
	
              _________________________________

            	 	 	By:_________________________________
	Paul Abramowitz	 	 	Gerard
              C. D’Couto
              
              President
                & Chief Executive Officer


            


    

          

    
      
         

      

      
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