form8k.htm
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): February 1, 2010
PureSafe
Water Systems, Inc.
(Exact
name of registrant as specified in charter)
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Delaware
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0-30544
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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25
Fairchild Avenue – Suite 250, Plainview, NY
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11803
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code: (516) 208-8250
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a
-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d
-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e
-4(c))
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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On
February 1, 2010, the Board of Directors of the Company approved Employment
Agreements with Leslie J. Kessler, our Chief Executive Officer, and Terry R.
Lazar, our Chief Financial Officer. The Employment Agreements are effective
January 1, 2010, for initial terms of five years, and the term is automatically
extended for additional one year periods if neither party gives notice of
termination at least 90 days prior to the end of the initial term or any current
additional one year term.
The
Employment Agreement with Ms. Kessler provides for a base salary of $180,000 per
year, and the Employment Agreement with Mr. Lazar provides for a base salary of
$140,400. Both Employment Agreements provide for incentive payments as
established by the Board of Directors and for a performance bonus as
follows:
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Net Operating Profit Before Income Taxes
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Performance Bonus
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On
the First $10 Million
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0%
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On
the Next $40 Million
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3.5%
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On
the Next $50 Million
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2.5%
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On
all Amounts Over $100 Million
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1.5%
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Both
Employment Agreements contain similar provisions for discharge for "cause",
including breach of the Employment Agreement or specified detrimental conduct by
the employee, in which cases accrued compensation would payable as provided in
the Employment Agreements. The Agreements also provide for
termination by the executives for “good reason”, comprising events such as
breach of the Agreement by the Company, assignment of duties inconsistent with
the Executive’s position, transfer of the executive’s primary office by more
than 25 miles from Plainview, New York, or in the event of a change in control
of the Company. In the event of a termination by the Company without cause, or
by the executive for “good reason”, the Company is required to pay to the
Executive in a lump sum in cash within 30 days after the date of termination the
aggregate of the following amounts:
A. the
sum of (1) the executive’s annual minimum salary through the date of termination
to the extent not theretofore paid, (2) any annual incentive payment earned by
the executive for a prior period to the extent not theretofore paid and not
theretofore deferred, (3) any annual performance bonus payment earned by the
executive for a prior period to the extent not theretofore paid and not
theretofore deferred,(4) any accrued and unused vacation pay and (5)
any business expenses incurred by the executive that are unreimbursed as of the
date of termination;
B. The
product of (1) the performance bonus payment and (2) a fraction, the numerator
of which is the number of days that have elapsed in the fiscal year of the
Company in which the date of termination occurs as of the date of termination,
and the denominator of which is 365;
C. the
amount equal to the sum of (1) three (3) times the executive’s annual
minimum salary; (2) one (1) times the performance bonus payment and
(3) one (1) times the incentive payment;
D. In the
event executive is not fully vested in any retirement benefits with the Company
from pension, profit sharing or any other qualified or non-qualified retirement
plan, the difference between the amounts executive would have been
paid if he or she had been vested on the date his/her employment was terminated
and the amounts paid or owed to the executive pursuant to such retirement plans;
and
E. The
product of (1) the incentive payment and (2) a fraction, the numerator of which
is the number of days that have elapsed in the fiscal year of the Company in
which the date of termination occurs as of the date of termination, and the
denominator of which is 365.
In
addition all stock options and warrants outstanding as of the date of
termination and held by the executive shall vest in full and become immediately
exercisable for the remainder of their full term; all restricted stock shall no
longer be restricted to the extent permitted by law, and the Company will use
its best efforts, at its sole cost to register such restricted stock as
expeditiously as possible; and for the remainder of the executive’s life and the
life of his/her spouse, the Company is required to provide the executive
continued health care benefits. The executive is responsible for the payment of
any COBRA premium, provided that the Company is required to make a lump sum
payment to the executive equal to the cost of such premiums, plus an
income tax gross-up thereon so that the executive retains an amount
equal to the cost of such premiums. The Company in addition beyond the COBRA
period is required to pay the executive a lump sum cash amount equal to the
present value of the cost of premiums for health care coverage as a supplement
to Medicare benefits under an individual policy from a third party insurer, with
such insurer to be selected by the executive (which coverage in combination with
Medicare benefits shall provide benefits to the executive and/or his/her spouse
which are comparable to those provided to executive and/or his/her spouse under
the Company’s group health plan as of January 1, 2010) for the remainder of each
of the lives of the executive and/or his/her spouse.
Generally,
if an Employment Agreement is terminated by reason of death or disability of the
executive, the Company is required to pay to the executive or his/her estate
accrued salary and bonus obligations, pro-rata incentive compensation, accrued
equity benefits and COBRA and retiree health benefits to the executive and/or
the executive’s spouse.
To the
extent any payment under the Employment Agreement to the executive is subject to
the excise tax imposed by section 4999 of the Internal Revenue Code, the
executive is entitled to a gross-up payment from the Company to reimburse the
executive for additional federal, state and local taxes imposed on executive by
reason of the excise tax and the Company’s payment of the initial taxes on such
amount. The Company is also required to bear the costs and expenses of any
proceeding with any taxing authority in connection with the imposition of any
such excise tax.
FOR THE
FULL TERMS OF THE EMPLOYMENT AGREEMENTS WITH OUR CHIEF EXECUTIVE OFFICER AND OUR
CHIEF FINANCIAL OFFICER, PLEASE REFER TO THE COPIES OF THE AGREEMENTS FILED AS
EXHIBITS WITH THIS REPORT.
Item 9.01
Financial Statements and Exhibits
(c)
Exhibits
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Employment
Agreement, effective as of January 1, 2010, between the Company and Leslie
J. Kessler.
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Employment
Agreement, effective as of January 1, 2010, between the Company and Terry
R. Lazar.
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Signatures
Pursuant to the requirements of the
Securities Exchange Act of 1934, the Company has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
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PureSafe
Water Systems, Inc.
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Date:
Februraury 8, 2010
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By:
/s/ Leslie Kessler
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Leslie
J. Kessler, President
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