Exhibit 10.5.1


 


SEVERANCE AGREEMENT


 


This Severance Agreement (the
“Agreement”) sets forth certain
understandings and agreements reached by and between Richard Piske, III,
acting on his own behalf (the “Employee”),
Stratum Holdings, Inc., a Nevada corporation, and all of its parents,
subsidiaries, and affiliated companies and divisions, including all officers,
directors, agents, and employees (collectively, the “Company”).  The
Employee and the Company are collectively referred to herein as the “Parties”.


 


WHEREAS, the Company has employed the Employee pursuant to an Employment
Agreement dated March 1, 2007 (the “Employment
Agreement”);


 


WHEREAS, the Employee and the Company have mutually agreed to gradually end
the Employee’s employment and transition his responsibilities pursuant to the
terms of this Agreement;


 


WHEREAS, the Employee desires to voluntarily resign his employment with the
Company following the closing of a contemplated transaction with Hamilton
Engineering, Inc. (the “Transaction”)
and the Company desires to accept such resignation;


 


WHEREAS,
the Transaction would not constitute a
Change in Control as defined in Section 6.5 of the Employment Agreement,
and the Employment Agreement does not otherwise provide any severance to the
Employee upon his voluntary resignation;


 


WHEREAS,
the Company desires to retain the Employee
through the closing date of the Transaction (the “Resignation Date”) and to provide severance
benefits to the Employee upon his termination of employment on the Resignation
Date; and


 


WHEREAS, the Parties each desire to formalize the terms, benefits, and
conditions relating to the Employee’s termination of employment by agreeing to
the terms in this Agreement.


 


NOW
THEREFORE, in exchange for the
consideration and mutual promises recited below, the Parties agree to the
following terms:


 


1.             Resignation of
Employment.  Subject to
the provisions of this Section 1, the Employee will continue to serve as
President and Chief Executive Officer of the Company until Resignation Date, on
which date he will resign said position and all other employment, officer or
director positions he holds with the Company or any of its parents,
subsidiaries and affiliated entities (collectively “Affiliates”);
provided that, on and after the Resignation Date, the Employee may continue to
serve on the Board of Directors of the Company for as long as the Company and
the Employee mutually agree.  The Company
will continue to pay the Employee his current base salary of $15,000 per month  and will provide the Employee all other employee benefits
through the Resignation Date.


 

















 


2.             Announcements. Following
execution of this Agreement, the parties agree to develop and agree on an
overall plan for the formal announcement of the Employee’s resignation to
employees of the Company and third parties and the parties agree that neither
the Company nor the Employee will make any formal announcements concerning the
Employee’s resignation to employees of the Company or third parties until
finalization of such plan except (i) as and when mutually agreed by the
parties, which agreement shall not unreasonably be withheld, or (ii) as
required by law.


 


3.             Early
Termination.  Prior to
the Resignation Date, the Company may terminate the Employee’s service with or
without “Cause” (as defined in the Employment Agreement), and the Employee may
terminate his service as President and as Chief Executive Officer for any
reason.  Any such termination shall be
referred to herein as an “Early Termination”. 
In the event of any Early Termination, such Early Termination shall be
governed by and subject to the terms and conditions of the Employment Agreement
and the Employee shall be entitled to the payments and benefits, if any,
provided thereunder.


 


4.             Severance
Payments and Other Actions. In consideration of the
amicable end to their employment relationship, if an Early Termination does not
occur, and subject to the Employee’s execution of the Separation Agreement and
Release  (a copy of which is attached as Exhibit A)
on or about the Resignation Date, the Company will provide the Employee with
the following severance payments in accordance with the terms of the Separation
Agreement and Release in full and complete settlement of any and all claims
(including any the Employee may have for attorneys’ fees and costs):


 


(a)           The
Company will pay as severance pay to the Employee the total amount of (i) a
cash lump sum payment of $200,000.00 upon the earlier to occur of (A) seven
(7) days following the date hereof or (B) the Resignation Date, and (ii) the
number of shares of the Company’s common stock with an aggregate value of
$280,000, which amount is equal to his Salary (as defined in the Employment
Agreement) for the remainder of the unexpired term of the Employment Agreement
less the amount paid under clause (i) above, which amount shall be divided
by the average of the common stock’s bid and ask prices for the 20 trading days
immediately prior to the Resignation Date (clauses (i) and (ii) referred
to herein as “Severance Pay”).  The Parties acknowledge and agree that this
Agreement sets forth all of the terms, conditions, payments, and benefits
relating to the Employee’s separation from employment and the termination of
the Employment Agreement.


 


(b)           On
or prior to the Resignation Date, the Company agrees to transfer legal title to
the Employee of the BMW 5-Series automobile currently being used by the
Employee in his employment with the Company.


 


The
Employee acknowledges that the Company’s obligation to pay severance, if any,
will arise only after the Employee’s employment has ended and, only if the
Employee signs and returns the Separation Agreement and Release in the form
attached hereto as Exhibit A. 
The Employee further acknowledges and agrees that the Severance Pay
constitutes consideration for the Employee’s release of claims at the time of
his resignation.  In the event the
Employee declines 


 


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to
sign the Separation Agreement and Release, he shall not be entitled to any
severance, and the Company will have no further liability or obligation to the
Employee under this Agreement or in connection with his employment or
resignation.  The Employee agrees and
understands that the Employee must return any and all property belonging to the
Company, including, but not limited to, copiers, printers, fax machines,
telephones, credit cards, files, and other equipment as a condition to
receiving the amounts described herein. 
In the event that the Transaction is not consummated, the Company and
the Employee agree that the Employment Agreement will remain in full force and
effect, and both parties will perform their respective rights, duties and
obligations thereunder, including, but not limited to, the salary adjustment
contemplated thereunder.


 


5.             Stock Option
Grants.  On the Resignation Date, the
Company will vest all outstanding stock options currently held by the Employee
(the “Options”), and all such
Options shall remain exercisable for the remainder of their unexpired terms in
accordance with the original grant agreements.


 


6.             Waiver of
Additional Compensation or Benefits.  Other than compensation and benefits provided
for in this Agreement, the Employee shall not be entitled to
any additional compensation, benefits, payments or grants under any
benefit plan, employment agreement, severance plan or bonus or incentive
program established by the Company or any affiliate.  Any vested interest held by the Employee in the
Company’s 401(k) Plan, retirement plan and any other plans in which the
Employee participates shall be distributed in accordance with the terms of the
plan and applicable law.  The Employee
has no right to any stock options or grants under any plan.


 


7.             Confidentiality
and Return of the Company Property. The Employee further
agrees that the Employee will keep any proprietary or confidential information
pertaining to the business of the Company and its owners, principals, and
partners, gained during the Employee’s employment strictly confidential, unless
required by law to disclose such information. Such information includes
customer lists and names, pricing methods, prices charged to customers,
customer proposals, methods of doing business, and computer programs and
designs. The Employee will also immediately return all documents and electronic
data and information that the Employee obtained during employment at the
Company. The Employee also agrees to keep the terms and existence of this
Agreement confidential and will not disclose any of its terms to a third party.


 


8.             Breach of
Confidentiality. The Employee agrees that a breach by the Employee
of the promises of confidentiality and nondisclosure set forth in this
Agreement shall be a material breach of this Agreement, for which the Company
will suffer damages and may seek legal damages (including the return of any
consideration provided to the Employee under this Agreement), including
attorney’s fees and costs, injunctive relief and other appropriate relief
against him in a court of law.


 


9.             References. Unless
otherwise required by law or upon advice of counsel, the Company agrees to
provide the Employee with a reference, giving only dates of employment and job
title should the Employee seek new employment. The Employee acknowledges and
agrees 


 


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that the
Company is otherwise required to provide such a reference is adequate
consideration for this Agreement.


 


10.           Acknowledgement. The Employee
represents and acknowledges that the Employee has read all of the terms of this
Agreement and has had an adequate opportunity to discuss it with others not
associated with the Company, including his own independent legal counsel. The Employee
agrees that the Company, or its
respective representatives, employees, or agents have made any representations
to the Employee concerning the terms or effects of this Agreement other than
those contained in this Agreement.


 


11.           Indemnification. In further
consideration of the amounts paid by the Company and the releases contained
herein, each of the Employee and the Company agrees to indemnify
unconditionally and hold harmless the other party from any and all damages,
costs, fines, or penalties, arising out of or relating to a claim, suit,
action, or petition by any person or entity seeking relief against the other
party based in whole or in part on the negligence or wrongful acts of such
party.


 


12.           Governing Law:
No Modifications: Venue. This Severance Agreement shall be governed
by and construed in accordance with the laws of the State of Texas, and cannot
be amended, modified, or supplemented except by a written agreement entered
into by all parties hereto. Any action or suit to enforce or interpret this
Severance Agreement shall be filed in Harris, Texas.


 


13.           Severability:
Survival of Terms. In the event any provision of this Severance
Agreement is invalidated by a court of competent jurisdiction, then all of the
remaining provisions of this Severance Agreement shall continue unabated and in
full force and effect. All obligations of a continuing nature created by this Severance
Agreement shall survive its expiration or termination.


 


14.           No Admissions
of Liability. Neither this Agreement, nor anything contained
herein, is to be construed as an admission by any party of any liability or
unlawful conduct whatsoever. The Employee understands and agrees that the
obligation of the Company to perform under this Agreement is conditioned on the
Employee’s performance of all agreements, releases, and covenants as set forth
herein.


 


15.           Survival.  The provisions of Sections 7, 8 and 9 of the
Employment Agreement shall survive the termination of the Employee’s employment
in accordance with their terms.  Without
limiting the generality of the foregoing, the Employee confirms his commitment
to complying with Section 7 and 8 of the Employment Agreement.  For the purposes of Sections 7 and 8 of the
Employment Agreement, the date of termination of the Employee’s employment
shall be the Resignation Date. 
Furthermore, Section 9 of the Employment Agreement shall apply to
any controversy or claim arising out of or relating to this Agreement.  The parties agree that nothing contemplated
or effectuated by the terms of this Agreement or the execution and delivery of
this Agreement shall constitute “Cause” (as defined in the Employment
Agreement) for the Company to terminate the Employee’s employment and the
Employment Agreement.


 


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16.           No Assignment:
Binding Effect. The Employee warrants and represents that the Employee
has not assigned or transferred any rights or claims against the Company.  In
addition, this Agreement shall apply to the Employee and any of his assigns and
transferees. This Agreement shall inure to the benefit of and be binding on the
Parties hereto and their respective heirs, representatives, successors,
transferees, and assigns.


 


[Signature
Page Follows]


 


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IN WITNESS WHEREOF, the Company and the Employee hereto evidence their agreement by their
signatures.


 


	
  Stratum
  Holdings, Inc.

  	
  Richard
  Piske, III

  
	
   

  	
   

  
	
  By:

  	
  /s/
  D. Hughes Watler, Jr.

  	
   

  	
   

  	
  /s/
  Richard Piske, III

  	
   

  
	
   

  	
   

  	
   

  	
  Signature

  
	
  Its:

  	
  Chief
  Financial Officer

  	
   

  	
   

  
	
   

  	
  Title

  	
   

  	
  Date:   March 3,
  2008

  
	
   

  	
   

  
	
  Date:   March 3,
  2008

  	
   

  



 


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EXHIBIT A


FORM OF SEPARATION AGREEMENT AND RELEASE


 


This
Separation Agreement and Release (“Release Agreement”) is
between Stratum Holdings, Inc., a Nevada corporation, and all of its
parents, subsidiaries and affiliated companies and divisions, including all
officers, directors, agents, and employees (collectively, the “Company”) and Richard Piske, III,
acting on his own behalf (the “Employee”).


 


WHEREAS, the Employee has been employed by the Company
pursuant to an Employment Agreement dated March 1, 2007 (the “Employment Agreement”); and


 


WHEREAS, the Employee has voluntarily resigned his
employment with the Company, effective [DATE] (the “Resignation Date”).


 


WHEREAS, the Employee and the Company wish to resolve
amicably all outstanding issues between them.


 


THEREFORE, in consideration of the promises set forth below,
and for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:


 


1.             Resignation.  The Employee’s employment with the Company
will end effective [DATE].


 


2.             Severance. The Company
shall provide the Employee Severance Pay as described in the parties’ Severance
Agreement, subject to the Employee’s compliance with the terms of the Severance
Agreement, and provided that the Employee does not revoke this Release Agreement.


 


A.            The Employee
acknowledges that he is not otherwise entitled to the Severance Pay but for his
execution of this Release Agreement.  The
Employee acknowledges that he is not entitled to any further compensation from
the Company pursuant to this Release Agreement or his employment.


 


B.            If the Employee
breaches the Severance Agreement prior to full payment of the Severance Pay,
then, in addition to any other remedy at law or in equity which the Company may
have, the Company shall not be obligated to pay any unpaid part of the
Severance Pay.


 


3.             Release.  The Employee on behalf of the Employee, his
heirs, executors, successors and assigns, hereby releases, remises and
discharges the Company and each and every one of its former or current
directors, officers, employees, members, agents, successors, predecessors,
subsidiaries, assigns and attorneys of and from all actions, causes of action,
claims or complaints (collectively, “Claims”) in
law or equity which the Employee or his heirs, executors, administrators,
assigns, agents, representatives, attorneys, officers or employees 


 

















 


ever had or now has by reason of any matter, cause or thing whatsoever
at any time up to and including the date of execution of this Release
Agreement, including but not limited to any Claim of discrimination,
harassment, retaliation, breach of contract, wrongful termination, interference
with contractual relations, intentional infliction of emotional distress, any
alleged violation of any federal, state or local statutes, regulations or
ordinances, including but not limited to the federal and state laws known as
the Civil Rights Acts of 1964 and 1991, the Age Discrimination in Employment
Act, the Americans With Disabilities Act, the Employee Retirement Income
Security Act (other than any accrued benefit(s) to which the Employee has
a non-forfeitable right under any ERISA pension benefit plan), the retaliation
provisions of the Fair Labor Standards Act, the Family and Medical Leave Act,
the Worker Adjustment and Retraining Notification Act, and any amendments to
any of the foregoing, or any other Claims of any kind. Such release includes,
but is not limited to, any claim the Employee or his counsel may have, or had,
for payment of attorney’s fees, commissions or reimbursement of expenses.
Furthermore, except as provided herein, the Employee shall not pursue any such
Claim in any court, agency, board, committee or forum whatsoever, and shall
reimburse the Company for all fees and expenses associated with the Company’s
defense should the Employee pursue such a Claim, unless that claim challenges
the knowing and voluntary nature or the validity of this Separation Agreement
and Release under the Older Workers Benefit Protection Act.  The Employee acknowledges that the Severance
Pay provided for in the Severance Agreement constitutes good and valuable
consideration for the release contained in this Section 3.


 


4.             Confidentiality.  The content of this Release
Agreement, the fact of the execution of this Release Agreement and the circumstances
leading to the execution of the Release Agreement, are confidential and are not
to be disclosed by any party except as necessary to a party’s respective
accountants, attorneys, income tax preparers or similar professionals, each of
whom shall be bound by this confidentiality requirement.  All documents, records, techniques, business
secrets and other information which have come into the Employee’s possession
from time to time during the Employee’s affiliation with the Company and/or any
of its subsidiaries or affiliates shall be deemed to be confidential and
proprietary to the Company and/or any of its subsidiaries or affiliates and
shall be their sole and exclusive property. 
The Employee agrees that the Employee will keep confidential and not
divulge to any other party any of the Company’s or its subsidiaries’ or
affiliates’ confidential information and business secrets, including, but not
limited to, such matters as investor information, proprietary investment
strategies, portfolio information, key personnel, operational methods, plans
for future developments, and other business affairs and methods and other
information not readily available to the public, except as required by
law.  Additionally, the Employee agrees
that he shall promptly return to the Company any and all confidential and
proprietary information that is currently in the Employee’s possession.


 


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5.             Nondisparagement/Nondisruption.


 


A.            The Employee
and the Company shall reasonably cooperate with one another to effect a smooth
transition of the Employee’s workload.


 


B.            The Employee
shall not disparage the Company, including its parents, subsidiaries,
affiliated companies, divisions, officers, directors, agents, and employees,
nor will the Company’s officers and directors disparage the Employee in any
communication with any third party.  The
Company and the Employee agree that this is a material term of this Release
Agreement. This Section 5.B. does not restrict either party from
responding fully and truthfully in the context of a legal or other government
proceeding in which either is under oath or responding to subpoena or otherwise
required by law to cooperate with a government entity.


 


C.            Neither the
Employee nor the Company shall not take any action to disrupt the business
operations of the other.


 


6.             Non-Admission. The Employee
understands and agrees that this Release Agreement shall not in any way be
construed as an admission by the Company of any unlawful or wrongful acts
whatsoever against employee or any other employee, and the Company specifically
disclaims any liability to or wrongful acts against the Employee or any other
person.


 


7.             Right to Review.  The Employee represents and
agrees that he has had a reasonable time to review the Release Agreement and is
voluntarily entering into this Release Agreement. The Employee understands that
he may revoke this Release Agreement within seven (7) days after
execution. The Employee’s notice of revocation must be in writing and addressed
and delivered to the attention of the Company, on or before the end of the
seven (7)-day period. This Release Agreement will not be effective or
enforceable against the Company until eight (8) days after the Company has
received employee’s signed copy of this Release Agreement. That will be the “effective
date” of this Release Agreement. If the Employee revokes this Release Agreement
as described herein, the Release Agreement will not become effective, and the
Employee will not receive the payments set forth in the Severance Agreement. By
signing below, the Employee further confirms that he: (a) has read this
Release Agreement carefully and completely; (b) has been given a period of
at least twenty-one (21) days to consider and review this Release Agreement; (c) has
been advised to consult with legal counsel; and (d) understands all the
provisions in this Release Agreement. 
The Employee understands that it is his choice whether or not to enter
into this Release Agreement and that his decision to do so is voluntary and
made knowingly in the absence of fraud, duress, or coercion.


 


8.             Applicable Law.  This Agreement shall be
governed by and construed in accordance with the laws of the State of
Texas.  Venue of any litigation arising 


 


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from this Release Agreement shall be in a court of competent
jurisdiction in state or federal court located in Harris County, Texas.  The Employee agrees that he shall be subject
to the personal jurisdiction of the district courts of Harris County, the State
of Texas and the U.S. District Courts, Southern District of Texas.


 


9.             Severability.  If any portion of this
Agreement is void or deemed unenforceable for any reason, the unenforceable
portion shall be deemed severed from the remaining portions of this Agreement
that shall otherwise remain in full force and effect.


 


10.           Entire Agreement. This Agreement
constitutes the entire agreement between the parties and supersedes any and all
prior agreements or understandings relating thereto. This Agreement may be
modified only in writing and signed by both parties.


 


Please read carefully as this document includes a release of claims.


 


As evidenced by my signature below, I hereby certify that I have
carefully read the above Separation Agreement and Release and agree to its
terms.


 


	
  Richard
  Piske, III

  	
  Stratum
  Holdings, Inc.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  
							



 


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