Exhibit 10.1


 





SECOND
REVISED AND RESTATED EMPLOYMENT AGREEMENT


 


This SECOND REVISED AND RESTATED EMPLOYMENT
AGREEMENT (“Agreement”), which is made effective as of the 8th day of April 2020 (the “Effective
Date”), is made by and between Ideal Power Inc., a Delaware corporation, with headquarters located at 4120 Freidrich Lane,
Ste. 100, Austin, Texas 78744, hereinafter referred to as “Company”, and R. Daniel Brdar, residing at 194 Carousel
Lane, Driftwood, TX 78619, hereinafter referred to as “Executive.” The purpose of this Agreement is to confirm the
second revised and restated terms of the employment relationship between Company and Executive.


 


RECITALS


 


WHEREAS, Company and Executive wish
to revise and restate the terms of employment with Executive through entering into this Agreement, which replaces, in its entirety,
that certain Revised and Restated Employment Agreement, dated April 16, 2018, by and between Company and Executive (the “Former
Agreement”);


 


THEREFORE, in consideration of the
foregoing and of the mutual promises contained in this Agreement, Company and Executive (who are sometimes individually referred
to as a “Party” and collectively referred to as the “Parties”) agree as follows:


 


AGREEMENT


 


		1.	TERM; POSITION.



 


Company hereby employs Executive as Company’s
Chief Executive Officer, and Executive hereby accepts employment with Company pursuant to the terms of this Agreement, which will
continue until terminated pursuant to Section 11 or 12 below. For the sake of clarity, the Parties understand and agree that Executive’s
agreed change in position does not entitle Executive to any further benefits or compensation under the Former Agreement.


 


		2.	GENERAL DUTIES.



 


Executive shall devote his entire productive
time, ability, and attention to Company’s business during Executive’s employment. Executive shall report to Company’s
Board of Directors (the “Board”) and agrees to keep the Board fully informed with regard to critical issues affecting
the value and reputation of Company. Furthermore, in his capacity as Chief Executive Officer, Executive shall be primarily responsible
for the exercise of the powers and the discharge of the duties of Company that are not reserved for the Board, and shall have authority
and control over all personnel of Company, shall be responsible for managing the overall operations of Company and shall act as
the main point of communication between the Board and Company’s operations. Executive shall do and perform all services,
acts, or things necessary or advisable to discharge his duties under this Agreement, and such other duties as are commonly performed
by an employee of his rank in a publicly traded corporation or which may, from time to time, be prescribed by Company through the
Board. Executive agrees to cooperate with and work to the best of his ability with Company’s management team, which includes
the Board and the officers and other employees, to continually improve Company’s reputation in its industry for quality products
and performance.


 






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		3.	NONSOLICITATION AND PROPRIETARY PROPERTY AND CONFIDENTIAL
INFORMATION PROVISIONS.



 


Executive previously executed a Proprietary
Information and Inventions Agreement (“PIIA”), the terms of which are included by reference into this Agreement. Executive
agrees to continue to abide by the PIIA.


 


		4.	COMPLIANCE WITH SECURITIES LAWS.



 


Executive acknowledges that he is subject
to the provisions of Sections 10 and 16 of the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder.
Executive acknowledges that Sections 10 and 16 and the rules and regulations promulgated thereunder may prohibit Executive from
selling or transferring his securities in Company. Executive agrees that he will comply with Company’s policies, as stated
from time to time, relating to selling or transferring Company’s securities.


 


		5.	COMPENSATION.



 


(a)       Base
Salary. Executive will receive a base salary in the amount of $233,220/year ($19,435.00 per month). The salary paid during
Executive’s employment shall be referred to in this Agreement as the “Base Salary”. The Base Salary shall be
subject to any tax withholdings and/or employee deductions that are applicable. The Base Salary shall be paid to Executive in equal
installments in accordance with the periodic payroll practices of the Company for its employees. The Base Salary will be subject
to review and adjustment at the discretion of the Board no less frequently than annually.


 


(b)       Bonus.
At least annually, Executive and the Compensation Committee of the Board of Directors shall meet to establish (i) performance
standards and goals (“Standards and Goals”) to be met by Executive and (ii) cash bonus targets based on the Standards
and Goals that are achieved. The Standards and Goals will support a cash bonus of up to 50% of Executive’s Base Salary. The
Standards and Goals and the bonus targets shall be mutually agreed to by Executive and the Compensation Committee. Nothing in this
subsection (b) shall prevent Executive and the Compensation Committee from mutually agreeing to alternatives to the computation
of the bonus to be paid to Executive in accordance with this subsection (b) (the “Bonus”), which may be implemented
and paid to Executive in place of the Bonus described herein. The Bonus shall be subject to any applicable tax withholdings and/or
employee deductions and shall be paid on or before March 15th of the following calendar year. Given the retention aspects
of the Bonus, the Bonus shall not be earned unless Executive is employed on the day of pay-out.


 


(c)       Cost
of Living Adjustment. Commencing on each January 1st after signing this Agreement, the then effective Base Salary shall
be increased (but not decreased) by an amount which shall reflect the increase, if any, in the cost of living during the previous
12 months by adding to the Base Salary an amount computed by multiplying the Base Salary by the percentage by which the level of
the Consumer Price Index for the Austin Metropolitan Area, as reported on January 1st of the new year by the Bureau of Labor Statistics
of the United States Department of Labor has increased over its level as of January 1st of the prior year.


 






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(d)       Participation
In Employee Benefit Plans. Executive shall have the same rights, privileges, benefits and opportunities to participate
in any of Company’s employee benefit plans which may now or hereafter be in effect on a general basis for executive officers
or employees. During Executive’s employment, the Company shall provide, at Company’s sole expense, medical and dental
benefits for Executive, his spouse and children under the same policy or policies generally available to other executive officer
of the Company. At the discretion of the Board, Company may also provide, at its sole expense (i) disability insurance which, in
the event of Executive’s disability, will replace no less than 60% of the Base Salary being paid to Executive at the time
the disability occurred and (ii) life insurance in an amount to be agreed upon by the Board and Executive. Irrespective of the
foregoing, Company may change any benefits contractor, or discontinue any benefit without replacement, in its sole discretion,
and any such change or discontinuance will not be a breach of this Agreement. In the event Executive receives payments from the
disability insurer, Company shall have the right to offset such payments against the Base Salary otherwise payable to Executive
during the period for which such payments are made.


 


		6.	EQUITY COMPENSATION.



 


During Executive’s
employment and subject always to the discretion of the Compensation Committee of the Board, Executive may be eligible to receive
additional awards from the 2013 Equity Incentive Plan (or any other equity incentive plan adopted by the Board).


 


		7.	REIMBURSEMENT OF BUSINESS EXPENSES.



 


Company shall promptly reimburse Executive
for all reasonable business expenses incurred by Executive in connection with the business of Company. However, each such expenditure
shall be reimbursable only if Executive furnishes to Company adequate records and other documentary evidence required by federal
and state statutes and regulations issued by the appropriate taxing authorities for the substantiation of each such expenditure
as an income tax deduction.


 


		8.	PAID TIME OFF.



 


Executive shall
be entitled to four weeks of paid time off each year; provided, however, failure to use paid time off by the end of the
year in which it is earned will prevent the accumulation of additional paid time off in excess of four weeks.


 


		9.	INDEMNIFICATION OF LOSSES.



 


So long as Executive’s actions were
taken in good faith and in furtherance of Company’s business and within the scope of Executive’s duties and authority,
Company shall indemnify and hold Executive harmless to the full extent of the law from any and all claims, losses and expenses
sustained by Executive as a result of any action taken by him to discharge his duties under this Agreement, and Company shall defend
Executive, at Company’s expense, in connection with any and all claims by stockholders or third parties.


  






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		10.	PERSONAL CONDUCT.



 


Executive agrees promptly and faithfully to
comply with all present and future policies, requirements, directions, requests and rules and regulations of Company in connection
with Company’s business. Executive further agrees to conform to all laws and regulations and not at any time to commit any
act or become involved in any situation or occurrence tending to bring Company into public scandal, ridicule or which will reflect
unfavorably on the reputation of Company.


 


		11.	TERMINATION FOR CAUSE.



 


The Company may terminate Executive for
cause immediately, without notice, if Company reasonably concludes that Executive has committed fraud, theft, embezzlement, misappropriation
of Company funds or other property, or any felony. The Company may also terminate Executive for cause for any of the following:


 


(a)       Breach
by Executive of any material provision of this Agreement;


 


(b)       Violation
by Executive of any statutory or common law duty of loyalty to Company; or


 


(c)       A
material violation by Executive of Company's employment policies; or


 


(d)       Commission
of such acts of dishonesty, gross negligence, or willful misconduct as would prevent the effective performance of Executive’s
duties or which result in material harm to Company or its business.


 


The Company may terminate this Agreement for
cause by giving written notice of termination to Executive, provided, however, if the Company determines Executive to be in default
of this Agreement under subsection (a) above because Executive fails to substantially perform his material duties and responsibilities
under this Agreement, the Company shall deliver a written demand for substantial performance of such duties and responsibilities
to Executive. Such demand must identify the manner in which the Company believes that Executive has not substantially performed
his duties, and Executive shall have a period of 30 days to correct the deficient performance. Upon termination for cause, the
obligations of Executive and Company under this Agreement shall immediately cease. Such termination shall be without prejudice
to any other remedy to which Company may be entitled either at law, in equity, or under this Agreement. If Executive’s employment
is terminated pursuant to this paragraph, Company shall pay to Executive (i) Executive’s accrued but unpaid Base Salary and
the value of unused paid time off through the effective date of the termination; (ii) Executive’s accrued but unpaid Bonus,
if any; and (iii) business expenses incurred prior to the effective date of termination. Executive shall not be entitled to continue
to participate in any employee benefit plans except to the extent provided in such plans for terminated participants, or as may
be required by applicable law.


  






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		12.	OTHER TERMINATIONS.



 


(a)       Death.
Executive’s employment shall terminate upon the death of Executive. Upon such termination, the obligations of Executive and
Company under this Agreement shall immediately cease.


 


(b)       Disability.
The Company reserves the right to terminate Executive’s employment upon 30 days written notice if, for a period of 90 days,
Executive is prevented from discharging his substantial or material duties due to any physical or mental disability, except otherwise
required by law.


 


(c)       Election
By Executive. Executive’s employment may be terminated at any time by Executive for any reason upon not less than
30 days written notice by Executive to the Board.


 


(d)       Election
By Company. Executive’s employment may be terminated at any time by Company without cause upon not less than 30 days
written notice by the Company to Executive.


 


(e)       Termination
Due to a Change in Control. Executive’s employment may be terminated upon a Change in Control. For purposes of this
Agreement, the term “Change in Control” shall mean the sale or disposition by Company to an unrelated third party of
substantially all of its business or assets, or the sale of the capital stock of Company in connection with the sale or transfer
of a Controlling Interest in Company to an unrelated third party, or the merger or consolidation of Company with another corporation
as part of a sale or transfer of a Controlling Interest in Company to an unrelated third party. For purposes of this definition,
the term “Controlling Interest” means the sale or transfer of Company’s securities representing at least 50.1%
of the voting power. It will be presumed that a termination is a termination under this subsection (e) rather than a termination
under subsection (d) (Election by Company) if Executive’s employment is terminated during the period that begins when negotiations
for the Change in Control begin and ends on the six month anniversary of the closing of the Change in Control transaction and such
termination is not a termination for cause pursuant to Section 11 or a termination resulting from Executive’s death, disability
or election pursuant to subsections (a), (b) or (c) of this Section 12.


 


(f)       Effect
of Various Terminations; Severance.


 


If Executive’s employment is terminated
pursuant to subsections (a), (b), or (c) of this paragraph, Company shall pay to Executive (i) Executive’s accrued but unpaid
Base Salary and the value of unused paid time off through the effective date of the termination; and (ii) business expenses incurred
prior to the effective date of termination. Executive shall not be entitled to continue to participate in any employee benefit
plans except to the extent provided in such plans for terminated participants, or as may be required by applicable law.


 






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If Executive’s employment is terminated
pursuant to subsection (d) of this paragraph, Company shall pay to Executive (i) Executive’s accrued but unpaid Base Salary
and the value of unused paid time off through the effective date of the termination ; (ii) business expenses incurred prior to
the effective date of termination; and (iii) a severance payment (“Severance”) equal to 12 months of Executive’s
former Base Salary, contingent upon Executive first signing and not revoking a general release of claims in a form provided to
Executive by Company within thirty days of Executive’s termination of employment and otherwise complying with all other provisions
of this Agreement, including the PIIA (the “Prerequisites”). The Severance shall be paid over time in equal installments,
with the first payment made on the thirtieth day following Executive’s termination and subsequent payments made on Company
paydays during the 12 month severance period (the “Severance Period”), provided Executive has satisfied his obligations
under this Agreement.




 


In addition to the above, “Severance
Amount” shall also include the amount of annual Bonus that the Executive would have otherwise received due to meeting some
or all of the bonus goals and objectives, but did not receive due to his termination without cause before the Bonus payment date,
provided that (1) Executive met some/all of the Standards and Goals outlined by the Compensation Committee for the applicable Bonus,
with the determination of meeting any subjective portion of the Bonus standards and goals to be determined by the Company in its
sole discretion; and (2) Executive was terminated without cause prior to the Bonus payment date.


 


In addition, in the event of a subsection
(d) without cause termination, provided Executive timely elects to continue his health insurance through the applicable provisions
of COBRA and remains eligible for such benefits, Company agrees to pay the cost for the COBRA premiums during the Severance Period
set forth above that applies to Executive (“COBRA Premiums”), contingent upon Executive first satisfying the Prerequisites.


 


If Executive’s employment is terminated
pursuant to subsection (e) of this Section 12, Executive shall receive (i) Executive’s accrued but unpaid Base Salary and
the value of unused paid time off through the effective date of the termination; and (ii) business expenses incurred prior to the
effective date of termination; and the Severance and COBRA Premiums (as defined above) he would receive under a termination pursuant
to subsection (d) of this Section 12, provided the Prerequisites have been satisfied. In addition, any equity award that is scheduled
to vest any time after the termination of Executive’s employment will vest immediately upon the termination of Executive’s
employment pursuant to subsection (e).


 


All other rights Executive has under any benefit
or stock option plans and programs shall be determined in accordance with the terms and conditions of such plans and programs.


 


With the exception of the terms of this paragraph
12 and any obligations, duties and responsibilities Executive has under the PIIA, upon termination of Executive’s employment
the obligations of Executive and Company under this Agreement shall immediately cease.


 


		13.	MISCELLANEOUS.



 


(a)       Preparation
of Agreement. It is acknowledged by each Party that such Party either had separate and independent advice of counsel or
the opportunity to avail itself or himself of same. In light of these facts it is acknowledged that no Party shall be construed
to be solely responsible for the drafting hereof, and therefore any ambiguity shall not be construed against any Party as the alleged
draftsman of this Agreement.


 






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(b)       Cooperation.
Each Party agrees, without further consideration, to cooperate and diligently perform any further acts, deeds and things and to
execute and deliver any documents that may from time to time be reasonably necessary or otherwise reasonably required to consummate,
evidence, confirm and/or carry out the intent and provisions of this Agreement, all without undue delay or expense.


 


(c)       Interpretation.


 


(i)       Entire
Agreement/No Collateral Representations. Each Party expressly acknowledges and agrees that this Agreement, including all exhibits
attached hereto and the PIIA Executive previously signed, which is expressly incorporated herein by reference: (1) is the final,
complete and exclusive statement of the agreement of the Parties with respect to the subject matter hereof; (2) supersedes any
prior or contemporaneous agreements, promises, assurances, guarantees, representations, understandings, conduct, proposals, conditions,
commitments, acts, course of dealing, warranties, interpretations or terms of any kind, oral or written, including but not limited
to the Former Agreement (collectively and severally, the “Prior Agreements”), and that any such prior agreements are
of no force or effect except as expressly set forth herein; and (3) may not be varied, supplemented or contradicted by evidence
of Prior Agreements, or by evidence of subsequent oral agreements. Any agreement hereafter made shall be ineffective to modify,
supplement or discharge the terms of this Agreement, in whole or in part, unless such agreement is in writing and signed by the
Party against whom enforcement of the modification or supplement is sought.


 


(ii)       Waiver.
No breach of any agreement or provision herein contained, or of any obligation under this Agreement, may be waived, nor shall any
extension of time for performance of any obligations or acts be deemed an extension of time for performance of any other obligations
or acts contained herein, except by written instrument signed by the Party to be charged or as otherwise expressly authorized herein.
No waiver of any breach of any agreement or provision herein contained shall be deemed a waiver of any preceding or succeeding
breach thereof, or a waiver or relinquishment of any other agreement or provision or right or power herein contained.


 


(iii)       Remedies
Cumulative. The remedies of each Party under this Agreement are cumulative and shall not exclude any other remedies to which
such Party may be lawfully entitled.


 


(iv)       Severability.
If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be determined
to be invalid, illegal or unenforceable under present or future laws effective during the term of this Agreement, then and, in
that event: (A) the performance of the offending term or provision (but only to the extent its application is invalid, illegal
or unenforceable) shall be excused as if it had never been incorporated into this Agreement, and, in lieu of such excused provision,
there shall be added a provision as similar in terms and amount to such excused provision as may be possible and be legal, valid
and enforceable, and (B) the remaining part of this Agreement (including the application of the offending term or provision to
persons or circumstances other than those as to which it is held invalid, illegal or unenforceable) shall not be affected thereby
and shall continue in full force and effect to the fullest extent provided by law.


 






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(v)       No
Third Party Beneficiary. Notwithstanding anything else herein to the contrary, the parties specifically disavow any desire
or intention to create any third party beneficiary obligations, and specifically declare that no person or entity, other than as
set forth in this Agreement, shall have any rights hereunder or any right of enforcement hereof.


 


(vi)       Headings;
References; Incorporation; Gender. The headings used in this Agreement are for convenience and reference purposes only, and
shall not be used in construing or interpreting the scope or intent of this Agreement or any provision hereof. References to this
Agreement shall include all amendments or renewals thereof. Any exhibit referenced in this Agreement shall be construed to be incorporated
in this Agreement. As used in this Agreement, each gender shall be deemed to include the other gender, including neutral genders
or genders appropriate for entities, if applicable, and the singular shall be deemed to include the plural, and vice versa, as
the context requires.


 


(d)       Enforcement.


 


(i)       Applicable
Law. This Agreement and the rights and remedies of each Party arising out of or relating to this Agreement (including, without
limitation, equitable remedies) shall be solely governed by, interpreted under, and construed and enforced in accordance with the
laws (without regard to the conflicts of law principles thereof) of the State of Texas, as if this agreement were made, and as
if its obligations are to be performed, wholly within the State of Texas.


 


(ii)       Consent
to Jurisdiction and Venue. Any action or proceeding arising out of or relating to this Agreement shall be filed in and heard
and litigated solely before the state courts of Texas within Travis County.


 


(iii)       Attorneys’
Fees. If court proceedings are required to enforce any provision of this Agreement, the substantially prevailing or successful
Party shall be entitled to an award of the reasonable and necessary expenses of litigation, including reasonable attorneys’
fees.


 


(e)       No
Assignment of Rights or Delegation of Duties by Executive. Executive’s rights and benefits under this Agreement are
personal to him and therefore (i) no such right or benefit shall be subject to voluntary or involuntary alienation, assignment
or transfer; and (ii) Executive may not delegate his duties or obligations hereunder.


 


(f)       Notices.
Unless otherwise specifically provided in this Agreement, all notices, demands, requests, consents, approvals or other communications
(collectively and severally called “Notices”) required or permitted to be given hereunder, or which are given with
respect to this Agreement, shall be in writing, and shall be given by: (A) personal delivery (which form of Notice shall be deemed
to have been given upon delivery), (B) by private overnight delivery service (which forms of Notice shall be deemed to have been
given upon confirmed delivery by the delivery agency), or (C) by mailing in the United States mail by registered or certified mail,
return receipt requested, postage prepaid (which forms of Notice shall be deemed to have been given upon the 5th business day following
the date mailed). Notices shall be addressed to the address hereinabove set forth in the introductory paragraph of this Agreement,
or to such other address as the receiving Party shall have specified most recently by like Notice, with a copy to the other Parties
hereto. Any Notice given to the estate of a Party shall be sufficient if addressed to the party as provided in this subparagraph.


 






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(g)       Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute
one and the same instrument, binding on all parties hereto. Any signature page of this Agreement may be detached from any counterpart
of this Agreement and reattached to any other counterpart of this Agreement identical in form hereto by having attached to it one
or more additional signature pages.


 


(h)       Execution
by All Parties Required to be Binding; Electronically Transmitted Documents. This Agreement shall not be construed to be
an offer and shall have no force and effect until this Agreement is fully executed by all Parties hereto. If a copy or counterpart
of this Agreement is originally executed and such copy or counterpart is thereafter transmitted electronically by facsimile or
similar device, such facsimile document shall for all purposes be treated as if manually signed by the Party whose facsimile signature
appears.


  




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IN WITNESS WHEREOF, the parties have executed this Agreement.


  


	 	Company:	 
	 	IDEAL POWER INC.	 
	 	 	 
	 	 	 
	 	 	 
	 	/s/ Ted Lesster	 
	 	Ted Lesster	 
	 	 	 
	 	Executive:	 
	 	 	 
	 	 	 
	 	 	 
	 	/s/ R. Daniel Brdar	 
	 	R. Daniel Brdar	 









 






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