exhibit 10.1




 

Exhibit 10.1

October 3, 2003

Bruce Ehlers
934 Olive Crest Dr.
Olivehain, CA 92024

Dear Bruce:

American Technology Corporation ("ATC") is pleased to present you with this
employment offer under the following terms and conditions:

	

Title:  

	

Senior Vice President of Engineering


	

 
	

Start Date:

	

September 29, 2003


	
 
	

Annual Base Salary:

	

$155,000.00


	
 
	

Bonus:

	

20% annual performance based bonus: (determined by Board of Directors)


	
 
	

Stock Options:

	

You will receive 75,000 stock options 30 days after employment. The options will
vest quarterly over a 2-year period commencing after 6 months of employment.
Vesting will commence on March 31, 2003. The exercise price will be the closing
bid price on the date of issuance.  Effective date of issuance is October 29,
2003.  


	
 
	

Travel & Entertainment:

	

A budget will be established for T&E per Company forecasts.


	
 
	

Benefits:

	

Medical and dental insurance, ATC will provide coverage in terms stated in our
Policy Manual. Premiums for both medical and dental insurance for employee and
dependents are covered at 100% for HMO levels. If available, the employee can
elect to upgrade the coverage at the cost to the employee. Benefits commence on
first day of the month of employment. Life insurance coverage is part of the
Dental plan and is covered by ATC.


	
 
	
 	

ATC observes 9 paid holidays per calendar year. Our Personal Days Off ("PDO")
policy is a combination of vacation and sick days. PDO hours are accrued per pay
period.  Your schedule is as follows:  


	
 
	
 	

Year one - 3 weeks or 4.62 hours per pay period;


	
 	

Year five - 4 weeks or 6.15 hours per pay period.


	
 	
 
	
 	

Vacation Accruals (PDO) will max out at 200 hours.


	
 
	
 	

A 401k package is available with multiple investment options and a company match
of 25% of Employees deferral up to 6%.


	
 
	

Position Description:

	

This position will be responsible for directing all engineering and research and
development activities for the company including the design of new products,
modification of existing designs, improve production techniques, and develop
test procedures.


	
 
	

Policy Manual:

	

Additional terms of your employment may be set forth in ATC's Policy Manual, as
revised from time to time.   


	
 
	
 
	

Arbitration:



	

You will be required to sign the attached Mutual Agreement to Arbitrate
("Arbitration Agreement"). (see exhibit)







  
     




You are entitled to all the published benefits of the company including, but not
limited to those listed above. You are subject to a review after your completion
of the 90-day probationary period to determine satisfaction of fulfilling job
responsibilities as directed by Kalani Jones, COO. After successful completion
of the probationary period and review you are eligible for time off accrued
during the probationary period.

Please sign this offer in the space provided below signifying that you have read
and accept the terms herein. Let me say that everyone at ATC is looking forward
to having a person of your caliber join the team and hope you feel welcome.

       

	

Sincerely,

	

/S/ BRUCE EHLERS


	
 	

Bruce Ehlers








/s/ RENEE WARDEN
Renee Warden
Director of Human
Resources