Document:

Exhibit
      10.4

     

    EMPLOYMENT
      AGREEMENT

     

    THIS
      AGREEMENT, made and entered into as of the 1st
      day of
      November, 2007 by and among ZBB ENERGY CORPORATION, a Wisconsin corporation
      (the
“Corporation”), and STEVEN ALLEN SEEKER (the “Employee”).

     

    WITNESSETH

     

    WHEREAS,
      the Corporation and the Employee desire to set forth in this Agreement the
      terms
      and conditions under which the Employee is to be employed by the
      Corporation.

     

    NOW,
      THEREFORE, the Corporation and the Employee, in consideration of the mutual
      promises hereinafter set forth, do hereby promise and agree as
      follows:

     

    ARTICLE
      I

     

    Term

     

    The
      term
      of the Employee’s employment under this Agreement shall commence effective as of
      the date set forth in Section I of Exhibit
      A
      attached
      hereto and shall, except as it may otherwise be subject to termination
      hereunder, continue thereafter for the period of time set forth in Section
      I of
Exhibit
      A
      attached
      hereto. The term of this Agreement shall renew automatically for successive
      terms of one year each unless either party elects not to renew this Agreement
      by
      delivery of written notice to the other party not less than ninety (90) calendar
      days prior to the end of the then current term.

     

    ARTICLE
      II

     

    Employment
      Duties

     

    During
      the term of the Employee’s employment hereunder, the Corporation shall employ
      the Employee and the Employee shall serve the Corporation as a full-time
      employee in such capacity and with such powers and duties as are set forth
      in
      Section II of Exhibit
      A
      attached
      hereto. The Board of Directors of the Corporation may, at its discretion, from
      time to time prescribe amended duties for the Employee. The Employee shall
      devote his entire working time and efforts to the business affairs of the
      Corporation and shall faithfully and to the best of his ability perform his
      duties hereunder. 

     

    ARTICLE
      III

     

    Compensation

     

    3.1 Salary,
      Benefits and Bonus.
      During
      the term of the Employee’s employment hereunder, the Employee shall be entitled
      to receive the salary, fringe benefits and bonus set forth in Section III of
      Exhibit
      A
      attached
      hereto. The Employee acknowledges that he shall have no vested rights in any
      such fringe benefit programs except as expressly provided under the terms
      thereof and that such programs may, at the Company’s discretion, be modified or
      terminated as well as supplemented at any time during the term of the Employee’s
      employment hereunder. 

     

    3.2 Withholding
      Taxes.
      The
      Corporation shall deduct from all payments to the Employee hereunder any
      federal, state or local withholding or other taxes or charges which the
      Corporation is from time to time required to deduct under applicable law, and
      all amounts payable to the Employee hereunder are stated herein before any
      such
      deductions. The Corporation shall have the right to rely upon written opinion
      of
      legal counsel, which may be independent legal counsel or legal counsel regularly
      employed by the Corporation, if any questions should arise as to any such
      deductions.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    ARTICLE
      IV

     

    Termination
      of Employment

     

    4.1 Causes
      for Termination.
      Notwithstanding the term set forth in Article I, above, the Employee’s
      employment hereunder shall be terminated prior to the expiration of the then
      current term upon the occurrence of any of the following events:

     

    4.1.1 In
      the
      event of the Employee’s death.

     

    4.1.2 In
      the
      event of the Disability of the Employee. For purposes of this Agreement,
“Disability” means Executive (i) is unable to engage in any substantial gainful
      activity by reason of any medically determinable physical or mental impairment
      which can be expected to result in death or can be expected to last for a
      continuous period of not less than 12 months, or (ii) is, by reason of any
      medically determinable physical or mental impairment which can be expected
      to
      result in death or can be expected to last for a continuous period of not less
      than 12 months, receiving income replacement benefits for a period of not less
      than six (6) months under an accident and health plan covering employees of
      the
      Company. If there is any dispute as to whether the Employee has a Disability
      as
      defined in this Section 4.1.2, such question shall be submitted to a licensed
      physician for the purpose of making such determination. An examination of the
      Employee shall be made within thirty (30) calendar days after written notice
      by
      the Corporation or the Employee to the other by a licensed physician agreeable
      to the Corporation. The Employee shall submit to such examination and provide
      such information that such physician may request and the determination of such
      physician as to the question of the Employee’s Disability shall be binding and
      conclusive on all parties concerned for purposes of this Agreement.

     

    4.1.3 Upon
      the
      commission of any of the following acts by the Employee:

     

    (a) The
      failure of the Employee to perform his duties for the Corporation (other than
      by
      reason of illness).

     

    (b) Use
      of
      alcohol or drugs in such a manner as to interfere with the performance of the
      Employee’s duties for the Corporation.

     

    (c) Willful
      conduct by the Employee which is demonstrably and materially injurious to the
      Corporation, monetarily or otherwise.

     

    (d) Conviction
      of the Employee of a felony or misdemeanor which, in the reasonable judgment
      of
      the Board of Directors of the Corporation, is likely to have an adverse effect
      upon the business or reputation of the Employee or the Corporation, or which
      substantially impairs the Employee’s ability to perform his duties for the
      Corporation.

     

    (e) Breach
      by
      the Employee of any agreement with the Corporation concerning noncompetition,
      nonsolicitation or the confidentiality of trade secrets or proprietary or other
      information.

     

    4.1.4. Upon
      the
      occurrence of Good Reason (defined below), if within
      30
      days of the initial existence of Good Reason, the Employee provides notice
      of
      Good Reason to the Corporation, the Corporation does not remedy said Good Reason
      within 30 days of its receipt of such notice, and the Employee terminates his
      employment effective any time after the expiration of such 30-day remedy period
      until the date that is six (6) months after the initial existence of Good
      Reason. For purposes of this Agreement, “Good Reason” shall mean the occurrence
      of any of the following without the consent of Employee: (a) a
      material diminution in Employee’s authority, duties, or responsibilities or (b)
      a Change of Control, which, for purposes of this Agreement, shall mean the
      first
      to occur of the following:

     

    
      
         

      

      
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    (i) the
      acquisition by an individual, entity or group, acting individually or in concert
      (a “Person”) of beneficial ownership of more than 50% of the then outstanding
      shares of common stock of the Corporation (the “Outstanding Common Stock”);
provided,
      however,
      that
      for purposes of this Section 4.1.4(b)(i), the following acquisitions shall
      not
      constitute a Change in Control: (A) any acquisition directly from the
      Corporation, (B) any acquisition by the Corporation, (C) any acquisition by
      any
      employee benefit plan (or related trust) sponsored or maintained by the
      Corporation or any corporation controlled by the Corporation, or (D) any
      acquisition by any corporation pursuant to a transaction which complies with
      clauses (A), (B) and (C) of Section 4.1.4(b)(ii) below; or

    

    (ii) consummation
      of a reorganization, merger or consolidation, share exchange, or sale or other
      disposition of all or substantially all of the assets of the Corporation (a
      “Business Combination”), in each case, unless, immediately following such
      Business Combination, (A) all or substantially all of the individuals and
      entities who were the beneficial owners of the Outstanding Common Stock
      immediately prior to such Business Combination beneficially own, directly or
      indirectly, more than 50% of, respectively, the then outstanding shares of
      common stock and the combined voting power of the then outstanding voting
      securities entitled to vote generally in the election of directors, as the
      case
      may be, of the corporation resulting from such Business Combination (including,
      without limitation, a corporation which as a result of such transaction owns
      the
      Corporation or all or substantially all of the Corporation’s assets either
      directly or through one or more subsidiaries) in substantially the same
      proportions as their ownership, immediately prior to such Business Combination
      of the Outstanding Common Stock, (B) no Person (excluding any employee benefit
      plan (or related trust) of the Corporation or such corporation resulting from
      such Business Combination) beneficially owns, directly or indirectly, more
      than
      50% of, respectively, the then outstanding common stock of the corporation
      resulting from such Business Combination or the combined voting power of the
      then outstanding voting securities of such corporation except to the extent
      that
      such ownership existed prior to the Business Combination, and (C) at least
      a
      majority of the members of the Board of the corporation resulting from such
      Business Combination were members of the Board of the Corporation at the time
      of
      the execution of the initial agreement providing for such Business Combination;
      or 

     

    (iii) approval
      by the shareholders of the Corporation of a complete liquidation or dissolution
      of the Corporation.

     

    4.2 Consequences
      of Termination.
      In the
      event of the termination of the Employee’s employment with the Corporation, the
      following shall occur:

     

    4.2.1 If
      the
      Employee’s employment is terminated prior to the expiration of the then current
      term of this Agreement pursuant to the provisions of Section 4.1.1 or 4.1.2,
      above, (a) the Corporation shall pay to the Employee or the Employee’s estate,
      as the case may be, all compensation accrued under Article III, above, to the
      date of termination, (b) the Corporation shall pay to the Employee, or the
      Employee’s estate, as the case may be, an amount equal to the Employee’s annual
      salary paid to him in the one (1) year period immediately prior to his
      termination of employment, which shall be payable in twelve (12) equal
      consecutive monthly installments commencing upon the first day of the month
      following Employee’s death or Disability, (c) the Corporation shall pay
the
      full
      cost of COBRA coverage under the Corporation’s group health insurance plan on
      behalf of the Employee and his dependents for the twelve (12) month period
      following the date of termination, provided the Employee is covered by the
      Corporation’s group health insurance plan on the date of termination and the
      Employee and/or his dependents elect COBRA coverage in a timely
      manner,
      and (d)
      the Corporation shall cause all unvested benefits, if any, awarded to the
      Employee prior to the termination of his employment under any equity, stock
      or
      other option program of the Corporation (collectively, the “Option Plans”) to
      vest and become immediately exercisable by the Employee.

     

    
      
         

      

      
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    4.2.2 If
      the
      Employee’s employment is terminated prior to the expiration of the then current
      term of this Agreement pursuant to the provisions of Section 4.1.3, above,
      or if
      the Employee terminates the Employee’s employment for any reason, (a) the
      Corporation shall pay to the Employee all compensation accrued under Article
      III, above, to the date of termination, (b) the Employee shall be entitled
      to
      receive all benefits accrued to the date of termination of the Employee’s
      employment with the Corporation, all in accordance with the terms of such
      benefit plans including, without limitation, any forfeiture provisions set
      forth
      in such plans, and (c) all vested benefits, if any, held by the Employee on
      the
      date of his termination of employment under the Option Plans shall become
      immediately exercisable by the Employee. 

     

    4.2.3 If
      the
      Corporation terminates the Employee’s employment prior to the expiration of the
      then current term of this Agreement for any reason other than as set forth
      in
      Sections 4.1.1, 4.1.2 or 4.1.3, above, and such termination qualifies as a
      “separation from service” under Section 409A of the Internal Revenue Code of
      1986, as amended (the “Code”), then (a) the Corporation shall continue to pay
      the Employee his annual base salary which he received pursuant to Article III,
      above, in the year immediately preceding the date of his termination of
      employment with the Corporation, for the greater of twelve (12) months or the
      remaining term of the Agreement payable in accordance with the Corporation’s
      regular payroll practices, (b) the Corporation shall pay the
      full
      cost of COBRA coverage under the Corporation’s group health insurance plan on
      behalf of the Employee and his dependents for the twelve (12) month period
      following the date of termination, provided the Employee is covered by the
      Corporation’s group health insurance plan on the date of termination and the
      Employee and/or his dependents elect COBRA coverage in a timely
      manner,
      and (c)
      all vested or unvested benefits, if any, which the Employee was entitled to
      receive during the term of this Agreement under the Option Plans shall vest
      and
      become immediately exercisable. If Employee is a “specified employee” within the
      meaning of Section 409A(a)(2)(B) of the Code any payments under (a) above due
      within the six (6) month period following the termination will be delayed until
      the date that is six (6) months following the termination, at which point any
      such delayed payments will be paid to you in a lump sum.

     

    ARTICLE
      V

     

    Confidentiality;
      Return of Records

     

    5.1 Confidentiality
      Obligations.
      During
      the term of the Employee’s employment hereunder, the Employee will not directly
      or indirectly use or disclose any Confidential Information or Trade Secret
      of
      the Corporation, except in the interest and for the benefit of the Corporation.
      After the end, for whatever reason, of the Employee’s employment with the
      Corporation, the Employee will not directly or indirectly use or disclose any
      Trade Secret of the Corporation unless such information ceases to be deemed
      a
      Trade Secret by means of one of the exceptions set forth in Section 5.2.3,
      below. For a period of eighteen (18) months following the end, for whatever
      reason, of the Employee’s employment with the Corporation, the Employee will not
      directly or indirectly use or disclose any Confidential Information of the
      Corporation, unless such information ceases to be deemed Confidential
      Information by means of one of the exceptions set forth in Section 5.2.3,
      below.

     

    
      
         

      

      
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    5.2 Definitions.

     

    5.2.1 Trade
      Secret.
      The
      term “Trade Secret” shall have that meaning set forth under applicable
      law.

     

    5.2.2 Confidential
      Information.
      The
      term
“Confidential Information” means all non-Trade Secret information of, about or
      related to the Corporation or provided to the Corporation by its customers
      that
      is not known generally to the public or the Corporation’s competitors.
      Confidential Information includes but is not limited to: (i) inventions,
      product formulations and specifications, information about products under
      development, research, development or business plans, production processes,
      manufacturing techniques, equipment design and layout, test results, financial
      information, customer lists, information about orders from and transactions
      with
      customers, sales, marketing and acquisition strategies and plans, pricing
      strategies, information relating to sources of materials and production costs,
      personnel information and business records; and (ii) information which is
      marked or otherwise designated or treated as confidential or proprietary by
      the
      Corporation.

    

    5.2.3 Exclusions.
      Notwithstanding
      the foregoing, the terms “Trade Secret” and “Confidential Information” shall not
      include, and the obligations set forth in this Agreement shall not apply to,
      any
      information which: (i) can be demonstrated by the Employee to have been known
      by
      the Employee prior to the Employee’s employment by the Corporation; (ii) is or
      becomes generally available to the public through no act or omission of the
      Employee; (iii) is obtained by the Employee in good faith from a third party
      who
      discloses such information to the Employee on a non-confidential basis without
      violating any obligation of confidentiality or secrecy relating to the
      information disclosed; or (iv) is independently developed by the Employee
      outside the scope of the Employee’s employment without use of Confidential
      Information or Trade Secrets.

    

    5.3 Return
      of Records.
      Upon
      the
      end, for whatever reason, of the Employee’s employment with the Corporation or
      upon request by the Corporation at any time, the Employee shall immediately
      return to the Corporation all documents, records, and materials belonging and/or
      relating to the Corporation and all copies of all such materials. Upon the
      end,
      for whatever reason, of the Employee’s employment with the Corporation or upon
      request by the Corporation at any time, the Employee further agrees to destroy
      such records maintained by him on his own computer equipment and to certify
      in
      writing to the Corporation that such destruction has occurred.

    

    ARTICLE
      VI

     

    Customer
      Non-Solicitation

     

    6.1 Restrictions
      on Competition.

     

    6.1.1. During
      the term of the Employee’s employment hereunder, the Employee shall not directly
      or indirectly compete against the Corporation, or directly or indirectly divert
      or attempt to divert Customers’ business from the Corporation.

     

    6.1.2. For
      eighteen (18) months following the end, for whatever reason, of the Employee’s
      employment with the Corporation, the Employee agrees not to directly or
      indirectly solicit or attempt to solicit any business from any Restricted
      Customer in any manner which competes with the goods, products or services
      offered by the Corporation, or to directly or indirectly divert or attempt
      to
      divert any Restricted Customer’s business from the Corporation.

     

    6.2 Definitions.

     

    6.2.1
      Customer.
      The
      term “Customer” shall mean any individual or entity for whom/which the
      Corporation has provided goods, products or services.

     

    
      
         

      

      
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    6.2.2 Restricted
      Customer.
      The
      term
“Restricted Customer” means any individual or entity (i) for whom/which the
      Corporation provided goods, products or services and (ii) with whom/which the
      Employee had direct contact on behalf of the Corporation, or about whom/which
      the Employee acquired non-public information in connection with his employment
      by the Corporation, during the 12 months preceding the end of Employee’s
      employment with the Corporation.

     

    ARTICLE
      VII

     

    Restricted
      Services

     

    7.1 Restricted
      Services Obligation.
      For
      eighteen (18) months following the end, for whatever reason, of the Employee’s
      employment with the Corporation, the Employee agrees not to directly or
      indirectly provide Restricted Services to any Competitor, and not to directly
      or
      indirectly provide any Competitor with any advice or counsel concerning the
      Restricted Services, in the United States or any other country in which the
      Corporation or its subsidiaries designed, manufactured or sold utility energy
      storage applications and devices of the type or substantially similar to the
      type of such applications and devices designed, manufactured or sold by the
      Corporation and its subsidiaries during the twelve (12) months preceding the
      end
      of the Employee’s employment with the Corporation.

    

    7.2 Definitions.

    

    7.2.1 Restricted
      Services.
      The
      term “Restricted Services” means services of the type or substantially similar
      to the type of services the Employee provided to the Corporation during the
      twelve (12) months preceding the end of the Employee’s employment with the
      Corporation.

    

    7.2.2 Competitor.
      The
      term “Competitor” means any business, incorporated or otherwise, which designs,
      manufactures or sells utility energy storage applications and devices of the
      type or substantially similar to the type of such applications and devices
      designed, manufactured or sold by the Corporation and its subsidiaries during
      the twelve (12) months preceding the end of the Employee’s employment with the
      Corporation.

    

    ARTICLE
      VIII

     

    Employee
      Non-Solicitation

     

    During
      the term of the Employee’s employment hereunder and for eighteen (18) months
      thereafter, the Employee shall not directly or indirectly encourage any
      Corporation employee to terminate his/her employment with the Corporation or
      solicit such an individual for employment outside the Corporation.

     

    ARTICLE
      IX

     

    Assignment
      and Disclosure of Inventions and Patents

     

    The
      Employee hereby sells, assigns and transfers to the Corporation all of his
      right, title and interest in and to any and all Inventions (as hereinafter
      defined) and agrees that all Inventions are or shall become the sole and
      exclusive property of the Corporation and that only the Corporation shall have
      the right to use, sell, license, assign or otherwise exploit such Inventions
      and
      products, articles, commodities, methods or processes employing them. The
      Employee shall make a full and complete written disclosure of any and all
      Inventions to the Corporation and shall promptly execute and deliver to the
      Corporation all documents which the Corporation may deem necessary or
      appropriate to effect a valid assignment of the Employee’s right and title to
      any Invention to the Corporation or to prepare, file or prosecute any domestic
      or foreign patent application in connection therewith. The Employee further
      agrees to fully cooperate with the Corporation and to take such actions as
      the
      Corporation may request, including testimony in patent or other legal
      proceedings, in connection with the protection, establishment and/or enforcement
      of the Corporation’s rights to any such Invention and/or to permit the
      Corporation to reduce the same to practice. The Corporation agrees to reimburse
      the Employee for any out-of-pocket expenses expended by the Employee in
      complying with the provisions of this Article VI. In addition thereto, the
      Corporation shall pay to the Employee an amount equal to Two Hundred Fifty
      Dollars ($250.00) for each patent application prepared and filed with respect
      to
      an Invention conceived by the Employee which constitutes a trade secret of
      the
      Corporation. For purposes hereof, an “Invention” shall mean any idea,
      innovation, discovery, process, design, development, improvement, application,
      technique or invention, whether patentable or not, which in any way affects
      or
      relates to, or which is or may become capable of being used in the business
      of
      the Corporation and which the Employee may, either wholly or in part, and either
      solely or jointly with others, conceive, make or secure or may have conceived,
      made or secured at any time during the period of time he is employed by the
      Corporation or the Corporation’s predecessor entity or during the six (6) month
      period following termination of his employment with the
      Corporation.

     

    
      
         

      

      
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    ARTICLE
      X

     

    Expenses

     

    During
      the term of the Employee’s employment hereunder, the Corporation shall pay or
      reimburse the Employee for all reasonable and necessary business expenses
      incurred by the Employee in the interest of the Corporation in accordance with
      the Corporation’s reimbursement policies in effect from time to time. The
      Employee shall be required to submit an itemized account of such expenditures
      and such proof as may be necessary to establish to the satisfaction of the
      Corporation that the expenses incurred by the Employee were ordinary and
      necessary business expenses incurred on behalf of the Corporation.

     

    ARTICLE
      XI

     

    Waiver
      of Breach

     

    The
      waiver by the Corporation of any breach of any provision of this Agreement
      by
      the Employee shall not be deemed a waiver by the Corporation of any subsequent
      breach.

     

    ARTICLE
      XII

     

    Notice

     

    Any
      notice required or permitted to be given hereunder shall be in writing and
      shall
      be deemed to be sufficiently given and received in all respects when personally
      delivered or three (3) days after when deposited in the United States mail,
      certified mail, postage prepaid, return receipt requested and addressed to
      the
      principal office of the Corporation or the last know residence address of the
      Employee, as the case may be.

     

    ARTICLE
      XIII

     

    Assignment

     

    This
      Agreement may be assigned by the Corporation without the written consent of
      the
      Employee. The Employee may not assign, pledge or encumber any interest in this
      Agreement or any part thereof without the written consent of the
      Corporation.

     

    ARTICLE
      XIV

     

    Complete
      Agreement; Amendment

     

    This
      Agreement and the Exhibits attached hereto contain the full and complete
      understanding and agreement of the parties hereto and supersedes all prior
      agreements or understandings, whether oral or written, between the parties
      hereto with respect to the subject matter hereof. This Agreement may not be
      modified, amended, terminated or discharged orally.

     

    
      
         

      

      
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    ARTICLE
      XV

     

    Governing
      Law; Miscellaneous

     

    15.1 This
      Agreement and all questions of its interpretation, performance, enforceability
      and the rights and remedies of the parties hereto shall be governed by and
      determined in accordance with the internal laws of Wisconsin. The
      Employee agrees that any disputes arising out of this agreement shall be
      adjudicated in any state or federal court located in Milwaukee, Wisconsin having
      subject matter jurisdiction. The Employee hereby agrees, and waives any
      objection to the venue of Milwaukee, Wisconsin (including forum non conveniens)
      for any such action.

     

    15.2. The
      Employee certifies that the Employee has not, and will not, disclose or use
      during the Employee’s time as an employee to the Corporation, any confidential
      information which the Employee acquired as a result of any previous employment
      or under a contractual obligation of confidentiality or secrecy before the
      Employee became an employee of the Corporation.

     

    15.3 By
      entering into this Agreement, the Employee acknowledges the nature of the
      Corporation's business and the nature and scope of the restrictions set forth
      in
      Articles V, VI, VII and VIII including specifically Wisconsin’s Uniform Trade
      Secrets Act, presently Section 134.90, Wis. Stats. The Employee acknowledges
      and
      represents that the scope of the restrictions are appropriate, necessary and
      reasonable for the protection of the Corporation’s business, goodwill, and
      property rights. The Employee further acknowledges that the restrictions imposed
      will not prevent the Employee from earning a living in the event of, and after,
      the end, for whatever reason, of the Employee’s employment with the Corporation.
      Nothing in this Agreement shall be deemed to prevent the Employee, after
      termination of the Employee’s employment with the Corporation, from using
      general skills and knowledge gained while employed by the
      Corporation.

     

    15.4 The
      Employee agrees, during the term of any restriction contained in this Agreement,
      to disclose this Agreement to any future or prospective employer. The Employee
      further agrees that the Corporation may send a copy of this Agreement to, or
      otherwise make the provisions hereof known to, any such employer.

     

    15.5 Notwithstanding
      any termination of this Agreement, the Employee, in consideration of his
      employment hereunder to the date of such termination, shall remain bound by
      the
      provisions of this Agreement which specifically relate to periods, activities
      or
      obligations upon or subsequent to the termination of the Employee’s
      employment.

     

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

    

      
        	
                ZBB
                  ENERGY CORPORATION

              
	 	 
	
                By:

              	
                      
                  

              
	 	
                /s/
                  Robert Parry CEO

              
	 	 
	
                EMPLOYEE:

              
	
                     

              
	 	
                /s/
                  Steven Allen Seeker

              

      

    

    

    
      
         

      

      
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    EXHIBIT
      A

     

    SECTION
      1. TERM

     

    The
      term
      of the Employee’s employment under this Agreement shall commence effective as of
      July 1, 2007 and shall, except as it may otherwise be subject to termination
      under Article IV of this Agreement, continue thereafter for a period of three
      (3) years. The term of this Agreement shall renew automatically for successive
      terms of one year each unless either party elects not to renew this Agreement
      by
      delivery of written notice to the other party not less than ninety (90) calendar
      days prior to the end of the then current term. If this Agreement is renewed,
      the terms of this Agreement during any such renewal term shall be the same
      as
      the terms in effect immediately prior to such renewal.

     

    SECTION
      II POSITION
      AND DUTIES

     

    The
      Employee shall be employed by the Corporation in the capacity of Chief Operating
      Officer of ZBB Energy Corporation and
      in
      such capacity shall have responsibility for the overall management and control
      of the collective operations of the Corporation and its subsidiaries, subject
      to
      the authority of, and reporting to, the Corporation’s Chief Executive
      Office and to the Board of Directors.

     

    SECTION
      III SALARY,
      BENEFITS AND BONUS

     

    Salary.
      The
      Corporation shall pay to the Employee an annual salary at a rate equal to Two
      Hundred Thousand and no/100 Dollars ($200,000.00). The Employee’s salary shall
      be payable in equal installments not less frequently than monthly and shall
      be
      subject to increase each year in an amount equal to the Increase in the Cost
      of
      Living. “Increase in the Cost of Living” means the percentage increase in the
      Consumer Price Index. As used herein, “Consumer Price Index” as of any date
      means the index published most recently preceding such date by the Bureau of
      Labor Statistics, United States Department of Labor, “Consumer Price Index, All
      Urban Consumers, All Items, Milwaukee, Wisconsin (1982-84 = 100).” If the
      Consumer Price Index is discontinued, the parties will accept comparable
      statistics on the purchasing power of the consumer dollar as published at the
      time of such discontinuation by a responsible financial periodical or authority
      to be then chosen by mutual agreement of the parties. 

     

    Fringe
      Benefits.
      The
      Employee shall receive four (4) weeks of paid vacation annually. The Employee
      shall also be entitled to participate in any individual or group life insurance,
      health insurance, qualified pension or profit sharing plan or any other fringe
      benefit program which the Corporation may from time to time make available
      to
      its key executive employees. The Corporation recognizes the Employee is a key
      executive employee and as such will be eligible to participate in the
      Corporation’s stock option plans pursuant to their terms as created by the
      Corporation from time to time. Such stock entitlement benefits shall include,
      but shall not be limited to, the proposed stock entitlement benefits set forth
      on Annex I attached hereto.

     

    D&O
      Insurance.
      In the
      event the Corporation maintains a Directors and Officers Insurance Policy,
      the
      Corporation shall cover the employee to the same extent as other key executive
      employees and directors of the Corporation covered thereunder.

     

    Bonus.  The
      Employee may be eligible to earn an annual performance-based bonus in
      an
      amount of up to twenty five percent (25%) of his annual salary
      for each
      full calendar year during which the Employee is employed by the Corporation
      (“Bonus Year”), the terms and conditions of which, as well as the Employee's
      entitlement thereto, shall be determined annually in the sole discretion of
      the Corporation’s Board of Directors (“Performance Bonus”).
      Any Performance Bonus payable hereunder shall be paid following
      the Bonus Year not later than 30 calendar days following the Corporation’s
      receipt of its annual audited financial report.Exhibit
        10.5

      

      AGREEMENT

       

      THIS
        AGREEMENT, made and entered into as of the 1st day of July, 2008 by and among
        ZBB ENERGY CORPORATION, a Wisconsin corporation (the “Corporation”), and SCOTT
        SCAMPINI (“Scampini”).

       

      WITNESSETH

       

      WHEREAS,
        the Corporation and Scampini desire to set forth in this Agreement the terms
        and
        conditions under which Scampini is to be engaged by the
        Corporation.

       

      NOW,
        THEREFORE, the Corporation and Scampini, in consideration of the mutual promises
        hereinafter set forth, do hereby promise and agree as follows:

       

      ARTICLE
        I

       

      Term

       

      The
        term
        of the Scampini’s engagement under this Agreement shall commence effective as of
        the date set forth in Section I of Exhibit
        A
        attached
        hereto and shall, except as it may otherwise be subject to termination
        hereunder, continue thereafter for the period of time set forth in Section
        I of
Exhibit
        A
        attached
        hereto. The term of this Agreement shall renew automatically for successive
        terms of one year each unless either party elects not to renew this Agreement
        by
        delivery of written notice to the other party not less than ninety (90) calendar
        days prior to the end of the then current term.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        II

       

      Duties

       

      During
        the term of Scampini’s engagement hereunder, the Corporation shall engage the
        Scampini and Scampini shall serve the Corporation in such capacity and with
        such
        powers and duties as are set forth in Section II of Exhibit
        A
        attached
        hereto. The Board of Directors and CEO of the Corporation may, at its
        discretion, from time to time prescribe amended duties for Scampini. Scampini
        shall devote his efforts to the business affairs of the Corporation and shall
        faithfully and to the best of his ability perform his duties hereunder. However,
        Scampini’s work schedule will be flexible in nature as long as there is no
        conflict with his assigned duties. 

       

      ARTICLE
        III

       

      Compensation

       

      3.1 Salary,
        Benefits and Bonus.
        During
        the term of Scampini’s engagement hereunder, Scampini shall be entitled to
        receive the compensation, fringe benefits and bonus set forth in Section
        III of
Exhibit
        A
        attached
        hereto. Scampini acknowledges that he shall have no vested rights in any
        such
        fringe benefit programs except as expressly provided under the terms thereof
        and
        that such programs may, at the Company’s discretion, be modified or terminated
        as well as supplemented at any time during the term of Scampini’s engagement
        hereunder. 

       

      ARTICLE
        IV

       

      Termination
        

       

      4.1 Causes
        for Termination.
        Notwithstanding the term set forth in Article I, above, Scampini’s engagement
        hereunder shall be terminated prior to the expiration of the then current
        term
        upon the occurrence of any of the following events:

       

      4.1.1 In
        the
        event of the Scampini’s death.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      4.1.2 In
        the
        event of the Disability of Scampini. For purposes of this Agreement,
“Disability” means Executive (i) is unable to engage in any substantial gainful
        activity by reason of any medically determinable physical or mental impairment
        which can be expected to result in death or can be expected to last for a
        continuous period of not less than 12 months, or (ii) is, by reason of any
        medically determinable physical or mental impairment which can be expected
        to
        result in death or can be expected to last for a continuous period of not
        less
        than 12 months, receiving income replacement benefits for a period of not
        less
        than six (6) months under an accident and health plan covering employees
        of the
        Company. If there is any dispute as to whether Scampini has a Disability
        as
        defined in this Section 4.1.2, such question shall be submitted to a licensed
        physician for the purpose of making such determination. An examination of
        Scampini be made within thirty (30) calendar days after written notice by
        the
        Corporation or Scampini to the other by a licensed physician agreeable to
        the
        Corporation. Scampini shall submit to such examination and provide such
        information that such physician may request and the determination of such
        physician as to the question of Scampini’s Disability shall be binding and
        conclusive on all parties concerned for purposes of this Agreement.

       

      4.1.3 Upon
        the
        commission of any of the following acts by Scampini:

       

      (a) The
        failure of Scampini to perform his duties for the Corporation (other than
        by
        reason of illness).

       

      (b) Use
        of
        alcohol or drugs in such a manner as to interfere with the performance of
        Scampini’s duties for the Corporation.

       

      (c) Willful
        conduct by Scampini which is demonstrably and materially injurious to the
        Corporation, monetarily or otherwise.

       

      (d) Conviction
        of Scampini of a felony or misdemeanor which, in the reasonable judgment
        of the
        Board of Directors of the Corporation, is likely to have an adverse effect
        upon
        the business or reputation of Scampini or the Corporation, or which
        substantially impairs Scampini’s ability to perform his duties for the
        Corporation.

       

      (e) Breach
        by
        Scampini of any agreement with the Corporation concerning noncompetition,
        nonsolicitation or the confidentiality of trade secrets or proprietary or
        other
        information.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      4.2 Consequences
        of Termination.
        In the
        event of the termination of Scampini’s engagement with the Corporation, the
        following shall occur:

       

      4.2.1 If
        Scampini’s engagement is terminated prior to the expiration of the then current
        term of this Agreement pursuant to the provisions of Section 4.1.1 or 4.1.2,
        above, (a) the Corporation shall pay to Scampini or Scampini’s estate, as the
        case may be, all compensation accrued under Article III, above, to the date
        of
        termination, (b) the Corporation shall pay to Scampini, or Scampini’s estate, as
        the case may be, an amount equal to Scampini’s annual compensation paid to him
        in the one (1) year period immediately prior to his termination, which shall
        be
        payable in twelve (12) equal consecutive monthly installments commencing
        upon
        the first day of the month following Scampini’s death or Disability, (c) the
        Corporation shall continue to pay the full cost of Scampini’s health insurance
        plan (as identified in exhibit 1) on behalf of Scampini and his dependents
        for
        the twelve (12) month period following the date of termination (d) the
        Corporation shall cause all unvested benefits, if any, awarded to Scampini
        prior
        to the termination of his engagement under any equity, stock or other option
        program of the Corporation (collectively, the “Option Plans”) to vest and become
        immediately exercisable by Scampini.

       

      4.2.2 If
        Scampini is terminated prior to the expiration of the then current term of
        this
        Agreement pursuant to the provisions of Section 4.1.3, above, or if Scampini
        terminates the engagement for any reason, (a) the Corporation shall pay to
        Scampini all compensation accrued under Article III, above, to the date of
        termination, (b) Scampini shall be entitled to receive all benefits accrued
        to
        the date of termination of the Scampini’s engagement with the Corporation, all
        in accordance with the terms of such benefit plans including, without
        limitation, any forfeiture provisions set forth in such plans, and (c) all
        vested benefits, if any, held by Scampini on the date of his termination
        under
        the Option Plans shall become immediately exercisable by Scampini. 

       

      4.2.3 If
        the
        Corporation terminates Scampini prior to the expiration of the then current
        term
        of this Agreement for any reason other than as set forth in Sections 4.1.1,
        4.1.2 or 4.1.3, above, and such termination qualifies as a “separation from
        service” under Section 409A of the Internal Revenue Code of 1986, as amended
        (the “Code”), then (a) the Corporation shall continue to pay Scampini his annual
        base compensation which he received pursuant to Article III, above, in the
        year
        immediately preceding the date of his termination of engagement with the
        Corporation, for the greater of twelve (6) months or the remaining term of
        the
        Agreement payable in accordance with regular practices, (b) the Corporation
        shall pay any health insurance coverage under the group health insurance
        plan as
        identified in exhibit I on behalf of Scampini and his dependents for the
        six (6)
        month period following the date of termination. (c) all vested or unvested
        benefits, if any, which Scampini was entitled to receive during the term
        of this
        Agreement under the Option Plans shall vest and become immediately exercisable.
        

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        V

       

      Confidentiality;
        Return of Records

       

      5.1 Confidentiality
        Obligations.
        During
        the term of Scampini’s engagement hereunder, Scampini will not directly or
        indirectly use or disclose any Confidential Information or Trade Secret of
        the
        Corporation, except in the interest and for the benefit of the Corporation.
        After the end, for whatever reason, of Scampini’s engagement with the
        Corporation, Scampini will not directly or indirectly use or disclose any
        Trade
        Secret of the Corporation unless such information ceases to be deemed a Trade
        Secret by means of one of the exceptions set forth in Section 5.2.3, below.
        For
        a period of eighteen (18) months following the end, for whatever reason,
        of
        Scampini’s engagement with the Corporation, Scampini will not directly or
        indirectly use or disclose any Confidential Information of the Corporation,
        unless such information ceases to be deemed Confidential Information by means
        of
        one of the exceptions set forth in Section 5.2.3, below.

       

      5.2 Definitions.

       

      5.2.1 Trade
        Secret.
        The
        term “Trade Secret” shall have that meaning set forth under applicable
        law.

       

      5.2.2 Confidential
        Information.
        The
        term “Confidential Information” means all non-Trade Secret information of, about
        or related to the Corporation or provided to the Corporation by its customers
        that is not known generally to the public or the Corporation’s competitors.
        Confidential Information includes but is not limited to: (i) inventions,
        product formulations and specifications, information about products under
        development, research, development or business plans, production processes,
        manufacturing techniques, equipment design and layout, test results, financial
        information, customer lists, information about orders from and transactions
        with
        customers, sales, marketing and acquisition strategies and plans, pricing
        strategies, information relating to sources of materials and production costs,
        personnel information and business records; and (ii) information which is
        marked or otherwise designated or treated as confidential or proprietary
        by the
        Corporation.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      

      5.2.3 Exclusions.
        Notwithstanding the foregoing, the terms “Trade Secret” and “Confidential
        Information” shall not include, and the obligations set forth in this Agreement
        shall not apply to, any information which: (i) can be demonstrated by Scampini
        to have been known by Scampini prior to Scampini’s engagement by the
        Corporation; (ii) is or becomes generally available to the public through
        no act
        or omission of Scampini; (iii) is obtained by Scampini in good faith from
        a
        third party who discloses such information to Scampini on a non-confidential
        basis without violating any obligation of confidentiality or secrecy relating
        to
        the information disclosed; or (iv) is independently developed by Scampini
        outside the scope of Scampini’s engagement without use of Confidential
        Information or Trade Secrets.

      

      5.3 Return
        of Records.
        Upon
        the end, for whatever reason, of Scampini’s engagement with the Corporation or
        upon request by the Corporation at any time, Scampini shall immediately return
        to the Corporation all documents, records, and materials belonging and/or
        relating to the Corporation and all copies of all such materials. Upon the
        end,
        for whatever reason, of Scampini’s engagement with the Corporation or upon
        request by the Corporation at any time, Scampini further agrees to destroy
        such
        records maintained by him on his own computer equipment and to certify in
        writing to the Corporation that such destruction has occurred.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      

      ARTICLE
        VI

       

      Customer
        Non-Solicitation

       

      6.1 Restrictions
        on Competition.

       

      6.1.1. During
        the term of Scampini’s engagement hereunder, Scampini shall not directly or
        indirectly compete against the Corporation, or directly or indirectly divert
        or
        attempt to divert Customers’ business from the Corporation.

       

      6.1.2. For
        eighteen (18) months following the end, for whatever reason, of Scampini’s
        engagement with the Corporation, Scampini agrees not to directly or indirectly
        solicit or attempt to solicit any business from any Restricted Customer in
        any
        manner which competes with the goods, products or services offered by the
        Corporation, or to directly or indirectly divert or attempt to divert any
        Restricted Customer’s business from the Corporation.

       

      6.2 Definitions.

       

      6.2.1
        Customer.
        The
        term “Customer” shall mean any individual or entity for whom/which the
        Corporation has provided goods, products or services.

       

      6.2.2 Restricted
        Customer.
        The
        term “Restricted Customer” means any individual or entity (i) for whom/which the
        Corporation provided goods, products or services and (ii) with whom/which
        Scampini had direct contact on behalf of the Corporation, or about whom/which
        Scampini acquired non-public information in connection with his engagement
        by
        the Corporation, during the 12 months preceding the end Scampini’s engagement
        with the Corporation.

       

      ARTICLE
        VII

       

      Restricted
        Services

       

      7.1 Restricted
        Services Obligation.
        For
        eighteen (18) months following the end, for whatever reason, of Scampini’s
        engagement with the Corporation, Scampini agrees not to directly or indirectly
        provide Restricted Services to any Competitor, and not to directly or indirectly
        provide any Competitor with any advice or counsel concerning the Restricted
        Services, in the United States or any other country in which the Corporation
        or
        its subsidiaries designed, manufactured or sold utility energy storage
        applications and devices of the type or substantially similar to the type
        of
        such applications and devices designed, manufactured or sold by the Corporation
        and its subsidiaries during the twelve (12) months preceding the end of
        Scampini’s engagement with the Corporation.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      

      7.2 Definitions.

      

      7.2.1 Restricted
        Services.
        The
        term “Restricted Services” means services of the type or substantially similar
        to the type of services Scampini provided to the Corporation during the twelve
        (12) months preceding the end of the Scampini’s engagement with the
        Corporation.

      

      7.2.2 Competitor.
        The
        term “Competitor” means any business, incorporated or otherwise, which designs,
        manufactures or sells utility energy storage applications and devices of
        the
        type or substantially similar to the type of such applications and devices
        designed, manufactured or sold by the Corporation and its subsidiaries during
        the twelve (12) months preceding the end of Scampini’s engagement with the
        Corporation.

      

      ARTICLE
        VIII

       

      Non-Solicitation

       

      During
        the term of Scampini’s engagement hereunder and for eighteen (18) months
        thereafter, Scampini shall not directly or indirectly encourage any Corporation
        employee to terminate his/her employment with the Corporation or solicit
        such an
        individual for employment outside the Corporation.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        IX

       

      Assignment
        and Disclosure of Inventions and Patents

       

      Scampini
        hereby sells, assigns and transfers to the Corporation all of his right,
        title
        and interest in and to any and all Inventions (as hereinafter defined) and
        agrees that all Inventions are or shall become the sole and exclusive property
        of the Corporation and that only the Corporation shall have the right to
        use,
        sell, license, assign or otherwise exploit such Inventions and products,
        articles, commodities, methods or processes employing them. Scampini shall
        make
        a full and complete written disclosure of any and all Inventions to the
        Corporation and shall promptly execute and deliver to the Corporation all
        documents which the Corporation may deem necessary or appropriate to effect
        a
        valid assignment of Scampini’s right and title to any Invention to the
        Corporation or to prepare, file or prosecute any domestic or foreign patent
        application in connection therewith. Scampini further agrees to fully cooperate
        with the Corporation and to take such actions as the Corporation may request,
        including testimony in patent or other legal proceedings, in connection with
        the
        protection, establishment and/or enforcement of the Corporation’s rights to any
        such Invention and/or to permit the Corporation to reduce the same to practice.
        The Corporation agrees to reimburse Scampini for any out-of-pocket expenses
        expended by Scampini in complying with the provisions of this Article VI.
        In
        addition thereto, the Corporation shall pay to Scampini an amount equal to
        Two
        Hundred Fifty Dollars ($250.00) for each patent application prepared and
        filed
        with respect to an Invention conceived by Scampini which constitutes a trade
        secret of the Corporation. For purposes hereof, an “Invention” shall mean any
        idea, innovation, discovery, process, design, development, improvement,
        application, technique or invention, whether patentable or not, which in
        any way
        affects or relates to, or which is or may become capable of being used in
        the
        business of the Corporation and which Scampini may, either wholly or in part,
        and either solely or jointly with others, conceive, make or secure or may
        have
        conceived, made or secured at any time during the period of time he is employed
        by the Corporation or the Corporation’s predecessor entity or during the six (6)
        month period following termination of his engagement with the
        Corporation.

       

      ARTICLE
        X

       

      Expenses

       

      During
        the term of Scampini’s engagement hereunder, the Corporation shall pay or
        reimburse Scampini for all reasonable and necessary business expenses incurred
        by Scampini in the interest of the Corporation in accordance with the
        Corporation’s reimbursement policies in effect from time to time. Scampini shall
        be required to submit an itemized account of such expenditures and such proof
        as
        may be necessary to establish to the satisfaction of the Corporation that
        the
        expenses incurred by Scampini were ordinary and necessary business expenses
        incurred on behalf of the Corporation.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        XI

       

      Waiver
        of Breach

       

      The
        waiver by the Corporation of any breach of any provision of this Agreement
        by
        Scampini shall not be deemed a waiver by the Corporation of any subsequent
        breach.

       

      ARTICLE
        XII

       

      Notice

       

      Any
        notice required or permitted to be given hereunder shall be in writing and
        shall
        be deemed to be sufficiently given and received in all respects when personally
        delivered or three (3) days after when deposited in the United States mail,
        certified mail, postage prepaid, return receipt requested and addressed to
        the
        principal office of the Corporation or the last know residence address of
        Scampini, as the case may be.

       

      ARTICLE
        XIII

       

      Assignment

       

      This
        Agreement may be assigned by the Corporation without the written consent
        of
        Scampini. Scampini may not assign, pledge or encumber any interest in this
        Agreement or any part thereof without the written consent of the
        Corporation.

       

      ARTICLE
        XIV

       

      Complete
        Agreement; Amendment

       

      This
        Agreement and the Exhibits attached hereto contain the full and complete
        understanding and agreement of the parties hereto and supersedes all prior
        agreements or understandings, whether oral or written, between the parties
        hereto with respect to the subject matter hereof. This Agreement may not
        be
        modified, amended, terminated or discharged orally.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      ARTICLE
        XV

       

      Governing
        Law; Miscellaneous

       

      15.1 This
        Agreement and all questions of its interpretation, performance, enforceability
        and the rights and remedies of the parties hereto shall be governed by and
        determined in accordance with the internal laws of Wisconsin. Scampini agrees
        that any disputes arising out of this agreement shall be adjudicated in any
        state or federal court located in Milwaukee, Wisconsin having subject matter
        jurisdiction. Scampini hereby agrees, and waives any objection to the venue
        of
        Milwaukee, Wisconsin (including forum non conveniens) for any such
        action.

       

      15.2. Scampini
        certifies that he has not, and will not, disclose or use during his time
        as
        engaged by the Corporation, any confidential information which Scampini acquired
        as a result of any previous employment or under a contractual obligation
        of
        confidentiality or secrecy before Scampini became engaged by the
        Corporation.

       

      15.3 By
        entering into this Agreement, Scampini acknowledges the nature of the
        Corporation's business and the nature and scope of the restrictions set forth
        in
        Articles V, VI, VII and VIII including specifically Wisconsin’s Uniform Trade
        Secrets Act, presently Section 134.90, Wis. Stats. Scampini acknowledges
        and
        represents that the scope of the restrictions are appropriate, necessary
        and
        reasonable for the protection of the Corporation’s business, goodwill, and
        property rights. Scampini further acknowledges that the restrictions imposed
        will not prevent Scampini from earning a living in the event of, and after,
        the
        end, for whatever reason, of Scampini’s engagement with the Corporation. Nothing
        in this Agreement shall be deemed to prevent Scampini, after termination
        of
        Scampini’s engagement with the Corporation, from using general skills and
        knowledge gained while engaged by the Corporation.

       

      15.4 Scampini
        agrees, during the term of any restriction contained in this Agreement, to
        disclose this Agreement to any future or prospective employer. Scampini further
        agrees that the Corporation may send a copy of this Agreement to, or otherwise
        make the provisions hereof known to, any such employer.

       

      15.5 Notwithstanding
        any termination of this Agreement, Scampini, in consideration of his engagement
        hereunder to the date of such termination, shall remain bound by the provisions
        of this Agreement which specifically relate to periods, activities or
        obligations upon or subsequent to the termination of Scampini’s engagement at
        the corporation.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

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

       

      

        
          	
                  ZBB
                    ENERGY CORPORATION

                
	 	 
	
                  By:

                	
                         

                
	 	 
	
                  /s/
                    Robert J. Parry

                
	 
	 
	 
	
                  /s/
                    Scott W. Scampini

                

        

      

      
         

      

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      EXHIBIT
        A

       

      SECTION
        1. TERM

       

      The
        term
        of Mr. Scampini’s (Scampini) under this Agreement shall commence effective as of
        July 1, 2008 and shall, except as it may otherwise be subject to termination
        under Article IV of this Agreement, continue thereafter for a period of three
        (3) years.

       

      SECTION
        II POSITION
        AND DUTIES

       

      Scampini
        shall be engaged by the Corporation in the capacity of Chief Financial Officer
        of ZBB Energy Corporation and in such capacity shall have responsibility
        for the
        management and control of the operations of the Corporation and its subsidiaries
        as identified by the company’s CEO and, subject to the authority of, and
        reporting to, the Corporation’s Board of Directors.

       

      SECTION
        III COMPENSATION,
        BENEFITS AND BONUS

       

      Salary.
        The
        Corporation shall pay to Scampini compensation of three thousand and no /100
        Dollars ($3,000) per week and shall be payable every other week ($6,000)
        by
        check to S.W Scampini, S.C. This amount will be reviewed on June 30th
        of each
        year the contract is in effect. The Corporation and Scampini can elect jointly
        to renegotiate the terms and conditions of this agreement at any time during
        the
        course of this agreement if the Corporation and Scampini agree that Scampini
        should move to full employment status. 

       

      Scampini
        will have no specific vacation allocation. This arrangement will be in effect
        as
        long as the CFO duties identified by the companies CEO are fulfilled. Presently
        Scampini shall waive the right to participate in any individual or group
        life
        insurance, qualified pension or profit sharing plan or any other fringe benefit
        program which the Corporation may from time to time make available to its
        key
        executive employees. The Corporation recognizes Scampini is a key executive
        and
        as such will be eligible to participate in the Corporation’s stock option plans
        pursuant to their terms as created by the Corporation from time to time.
        Such
        stock entitlement benefits shall include, but shall not be limited to, the
        proposed stock entitlement benefits set forth on Annex I attached
        hereto.

       

      D&O
        Insurance.
        In the
        event the Corporation maintains a Directors and Officers Insurance Policy,
        the
        Corporation shall cover Scampini to the same extent as other key executives
        and
        directors of the Corporation covered thereunder.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Bonus.  Scampini
        may be eligible to earn an annual performance-based bonus for each calendar
        year
        during which Scampini is engaged by the Corporation, the terms and conditions
        of
        which, as well as Scampini’s entitlement thereto, shall be determined annually
        in the sole discretion of the Corporation’s Board of Directors
        (“Performance Bonus”). Any Performance Bonus payable hereunder shall be
        paid following year not later than 30 calendar days following the Corporation’s
        receipt of its annual audited financial report.

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