EMPLOYMENT AGREEMENT
This
employment agreement (the "Agreement") is made and entered into as of the 2nd day of
July , 2007
by and between Metropolitan Computing Corporation., a New Jersey Corporation
(the "Company"), and Xxxxxxx Xxxxx, (the "Executive").
RECITALS
A. The
Company has entered into a Stock Purchase Agreement with Bedminster National
Corp., effective the date hereof, (the “Stock Purchase Agreement”) and one of
the requirements of the Stock Purchase Agreement is that Executive and Company
enter into this Agreement.
B.
Executive has been instrumental in the development of the Company’s technology
and markets and potential markets. The Company desires to employ the Executive
from the date set forth above (the "Effective Date") until expiration
of the term of this Agreement, and Executive is willing to be employed
by Company during that period, on the terms and subject to the
conditions set forth in this Agreement.
In
consideration of the mutual
covenants and promises of the parties, the Company and Executive covenant and
agree as follows:
1. Duties
During
the term of this Agreement, Executive will be employed by the Company to serve
as President, chief executive officer and a director of the
Company. The Executive will devote such amount of business
time to the conduct of the business of the Company as may be reasonably required
to effectively discharge Executive’s duties under this Agreement,
will perform those duties and have such authority and powers as are
customarily associated with the office of a president and chief executive
officer of a company engaged in a business that is similar to the business
of
the Company, including (without limitation) (a) the authority to
direct and manage the day-to-day operations, finances and affairs of
the Company, and to allocate working capital within agreed budgets, (b) the
authority to hire, develop compensation plans for and discharge employees of
the
Company within agreed budgets or other agreed parameters; (c) the authority
to
determine the scope of new product development, marketing and sales strategy
and
(d) all other authority and powers exercised by the Executive prior
to the Effective Date as chief executive officer of the Company subject at
all
times to the overall direction of the Board of Directors of the
Company. Unless the parties agree otherwise in writing, during the
term of this Agreement, Executive will not be required to perform
services under this Agreement other than at Company's principal place
of business in East Hanover, NJ; provided, however, that Company may, from
time
to time, require Executive to travel temporarily to other locations
on the Company's business. Executive may perform services
electronically from remote locations consistent with past practices, subject
to
the reasonable approval of the Board of Directors.
2. Term
of Employment
2.1 Definitions
For
purposes of this Agreement the following terms have the following
meanings:
(a)
"Termination for Cause" means termination by Company of
Executive’s employment (i) by reason of Executive’s willful
dishonesty towards, fraud upon, or deliberate injury or attempted
injury to, the Company, (ii) by reason of Executive’s gross negligence or
intentional misconduct with respect to the performance of Executive’s
duties under this Agreement; provided, however, that no such
termination under this Section 2.1a(ii) will be deemed to be a Termination
for
Cause unless the Company has provided Executive with written notice
of what it reasonably believes are the grounds for any
Termination for Cause and Executive fails to take appropriate
remedial actions during the thirty day period following receipt of such written
notice.
(b)
"Termination Other than For Cause" means termination by the Company of
Executive’s employment by the Company for reasons other than those which
constitute Termination for Cause.
(c)
"Voluntary Termination" means termination by the Executive of the
Executive’s employment with the Company, upon six month’s advance
written notice to the Company, and excluding termination by reason of
Executive’s death or disability as described in Sections 2.5 and
2.6.
(d) “Termination
for Good Reason” means termination by the Executive of the
Executive’s employment with the Company, upon sixty days advance
written notice to the Company, after the occurrence of any of the following:
(i)
reduction of Executive’s then existing base salary; (ii) material reduction in
the package of benefits, taken as a whole, which are provided to Executive,
except to the extent that such benefits and incentives of all other executive
officers of the Company are similarly reduced; (iii) any diminution of
Executive’s duties, responsibilities, authority, reporting structure, titles or
offices, which is not remedied upon notice; (iv) request that Executive relocate
to a work site that would increase Executive’s one way commute by more than 20
miles, unless Executive accepts such relocation; (v) any material breach by
the
Company of its obligations under this Agreement, provided, however, that
no such termination under this Section 2.1d (v) will be deemed to be
a Termination for Good Reason unless the Executive has
provided Company with written notice of what he reasonably believes
are the grounds for any Termination for Good Reason and Company fails to take
appropriate remedial actions during the thirty day period following receipt
of
such written notice.
2.2 Basic
Term
The
term
of employment of Executive by the Company will commence on the Effective Date
and will extend through the period ending sixty months from the date
hereof, (the "Termination Date"). Company and
Executive may extend the term of this Agreement by mutual written
agreement.
2.3 Termination
for Cause
Termination
for Cause may be effected by Company at any time during the term of this
Agreement and may be effected by written notification to Executive; provided,
however, that no Termination for Cause will be effective unless Executive has
been provided with the prior written notice and opportunity for
remedial action described in Section 2.1. Upon Termination for Cause,
Executive is to be immediately paid all accrued
salary, incentive compensation (if any)to the extent earned, and
accrued vacation pay as provided in the Company’s Employee Manual, as the same
may be in effect from time to time , all to the date of termination, but
Executive will not be paid any severance compensation.
2.4 Termination
Other Than for Cause
Notwithstanding
anything else in this Agreement, Company may effect a Termination Other Than
for Cause at any time upon giving six month’s advance written notice
to Executive of such Termination Other Than for Cause. Upon
any Termination Other Than for Cause, Executive will immediately be
paid all accrued salary, incentive compensation (if any) to the
extent earned, and accrued vacation pay as provided in the Company’s Employee
Manual, as the same may be in effect from time to time , all to the date of
termination, together with severance compensation as provided in
Section 4.
2.5 Termination
Due to Disability
In
the
event that, during the term of this Agreement, Executive should, in the
reasonable judgment of the Board, fail to perform Executive’s duties
under this Agreement because of illness or physical or
mental incapacity ("Disability"), and such Disability continues for a
period of more than six consecutive months, or 180 days out of any consecutive
270 day period, Company will have the right to terminate or suspend Executive’s
employment under this Agreement by written notification to Executive
and payment to Executive of all accrued
salary and incentive compensation (if any) to the extent
earned, and accrued vacation pay as provided in the Company’s Employee Manual,
as the same may be in effect from time to time, all to the date of termination,
together with severance compensation as provided in Section 4, provided,
however, (a) that such severance compensation will be paid for a period of
the
lesser of one (1) year from the date Executive’s employment is terminated, or
until the Termination Date, and (b) such severance compensation will be reduced
by any payments made to Executive pursuant to any policy of disability
insurance, the premiums for which have been paid by the Company. Any
determination by the Board with respect to Executive’s Disability must be based
on a determination of competent medical authority or authorities, a
copy of which determination must be delivered to the Executive at the
time it is delivered to the Board. In the event the Executive
disagrees with the determination described in the previous sentence,
Executive will have the right to submit to the Board a determination
by a competent medical authority or authorities of Executive’s own choosing to
the effect that the aforesaid determination is incorrect and that
Executive is capable of performing Executive’s duties under this
Agreement. If, upon receipt of such determination, the Board wishes
to continue to seek to terminate this Agreement under the provisions
of this section, the parties will submit the issue of Executive’s
Disability to arbitration in accordance with the provisions of this
Agreement.
2.6 Death
In
the
event of Executive’s death during the term of this Agreement, Executive’s
employment is to be deemed to have terminated as of the last day of
the month during which Executive’s death occurred, and Company will
pay to Executive’s estate accrued salary, incentive compensation (if any) to the
extent earned, and accrued vacation pay as provided in the Company’s Employee
Manual, as the same may be in effect from time to time , all to the date of
termination.
2.7 Voluntary
Termination
In
the event of a Voluntary Termination, at the end of the six month notice period,
Company will immediately pay to Executive all accrued salary, incentive
compensation (if any) to the extent earned, and accrued vacation pay as provided
in the Company’s Employee Manual, as the same may be in effect from time to
time, all to the date of termination, but Executive will not be paid any
severance compensation.
2.8 Termination
for Good Reason
In
the
event of a Termination for Good Reason, Executive will immediately be paid
all
accrued salary, incentive compensation (if any) to the extent earned,
and accrued vacation pay as provided in the Company’s Employee Manual, as the
same may be in effect from time to time, all to the date of termination,
together with severance compensation as provided in Section
4.
3. Salary,
Benefits and Other Compensation
3.1 Base
Salary
As
payment for the services to be rendered by Executive as provided in Section
1
and subject to the terms and conditions of Section 2, Company agrees
to pay to Executive a "Base Salary," payable in equal semi-monthly
installments. The Base Salary payable to Executive under
this Section will initially be $180,000, subject to minimum annual cost of
living increase equal to the percentage increase in the Consumer Price Index
All
Urban Consumers, for the New York, Northern New Jersey area, or any successor
index applicable to the Northern New Jersey Area, but not less than
5% for the first two years If Executive’s Base Salary has not reached
$200,000, it will be increased to $200,000 upon achievement of the earn-out
provided in Section 2.2 b (ii) of the Stock Purchase
Agreement. Payment of earn-out is a separate obligation of Bedminster
National Corp.
3.2 Performance
and Incentive Bonus Plans
(a) During
the term of his employment under this Agreement, the Executive will be eligible
to participate in all other bonus and incentive plans established by the Board
for senior officers of the Company.
3.3 Benefit
Plans
During
the term of Executive’s employment under this Agreement, the Executive is to be
eligible to participate in all employee benefit plans to the extent
maintained by the Company, including (without limitation) any life,
disability, health, accident and other insurance programs including vision
and
health, paid vacations, 401K and similar plans or programs, subject
in each case to the generally applicable terms and conditions of the plan
or program in question and to the determinations of any committee
administering such plan or program. On termination of the
Executive for any reason, the Executive will retain all of Executive’s rights to
benefits that have vested under such plan, but the Executive’s rights
to participate in those plans will cease on the Executive’s
termination, except as otherwise required by law. The Company
will arrange for a term life insurance package comprising a total benefit of
$1.5 Million, of which, the estate of Executive will be the beneficiary of
$750,000 and the Company and/or its Lender as they may agree and as their
interests may appear, will be the beneficiary of $750,000 in the nature of
“key
man” insurance, provided, however, that the total premium for such package shall
not exceed $10,000 per year.
3.4 Withholding
of Taxes
The
Executive understands that the services to be rendered by Executive under this
Agreement will cause the Executive to recognize taxable income, which
is considered under the Internal Revenue Code of 1986, as amended,
and applicable regulations thereunder as compensation income subject to
the withholding of income tax (and Social Security or other
employment taxes). The Executive hereby consents to the
withholding of such taxes as are required by the Company.
3.5 Vacation
During
the term of this Agreement, Executive will be entitled to three weeks paid
vacation time per year.
3.6 Expenses
During
the term of this Agreement, Company will reimburse Executive for Executive’s
reasonable out-of-pocket expenses incurred in connection with
Company's business, including travel expenses, food, and lodging
while away from home, subject to such policies as Company may from time to
time reasonably establish for its employees.
3.7 Automobile
and Company equipment
The
Company recognizes the Executive’s need for an automobile and other
communication and information technology devices for business
purposes. Therefore, during the term of this Agreement, the Company
shall provide the Executive with an automobile allowance of $500 per month
for
fuel, maintenance, repairs, insurance, and other costs. Company will
also provide executive with with an allowance of $400 per month
for cell phone usage including mobile internet, personal professional
fees, home office, and with a laptop computer and GPS at reasonable
cost to the Company.
4. Severance
Compensation
4.1 Termination
Other Than for Cause; Termination for Good Reason
In
the
event Executive’s employment is terminated by the Company in a
Termination Other Than for Cause, or by Executive in a Termination for Good
Reason, Executive will be paid as severance pay an amount equal to sixty percent
(60%) of Executive’s Base Salary for the period commencing on the date
that Executive’s employment is terminated and ending on the
Termination Date, on the dates specified in Section 3.1 for payment of
Executive’s then current Base Salary.
4.2 Termination
for Disability
In
the event Executive’s employment is terminated because of Executive’s disability
pursuant to Section 2.5, Executive will be paid as severance pay
Executive’s Base Salary for the period commencing on the date that
Executive’s employment is terminated and ending on the earlier of one year from
such date or forty-two (42) months from the date of this Agreement, on the
dates
specified in Section 3.1 for payment of Executive’s Base
Salary.
4.3 Other
Termination
In
the
event of a Voluntary Termination, or Termination for Cause, Executive will
not
be entitled to any severance pay.
5. Confidentiality
and Non-Compete
(a) Because
of Executive’s employment by Company, Executive will have access to trade
secrets and confidential information about Company, its products, its
technology, its customers, and its methods of doing business
(the "Confidential Information"). During and after the
termination of Executive’s employment by the Company, Executive may
not directly or indirectly disclose or use any such Confidential
Information; provided, that Executive will not incur any liability
for disclosure of information which (a) is required in the course of
Executive’s employment by the Company (or any affiliate of the Company, provided
that such disclosure does not violate any obligation of the Company to a third
party), (b) was permitted in writing by the Board or (c)
is within the public domain or comes within the public domain without
any breach of this Agreement.
(b) In
connection with employment of Executive, Executive acknowledges that his service
on behalf of Company will result in familiarity with Company's Confidential
Information, as well as frequent contact with customers of Company
which will result in the association of the good will of Company with
Executive. Company's Confidential Information and the
relationships which Company builds with its customers are significant assets
owned by Company which Company has developed by a substantial investment of
time, effort and expense. Company has a legitimate interest in (i)
its Confidential Information, and (ii) the identity of the customers with whom
it does business;. Company intends to protect its interests by means
of enforcement of the restrictive covenant set forth in this
Section.
(c) During
the term of Executive’s employment and for a period of two years
thereafter, Executive agrees that Executive will not, directly or
indirectly, individually or on behalf of any other entity, solicit, or accept
employment with any person, company, firm or corporation (for profit or not
for
profit) which is engaged in the production and sale
of instrumentation, data acquisition systems, high-speed production
tablet press replication and tablet press control systems for the pharmaceutical
industry. During such time Executive will not solicit the services of
any employees of or consultants to the Company.
(d) Executive
acknowledges that breach of the restrictive covenant set forth in this Section
will result in irreparable and continuing damage to Company for which money
damage may not provide adequate relief. Executive therefore, agrees
that breach of this restrictive covenant shall entitle Company to seek
injunctive relief and money damages insofar as they can be determined under
the
circumstances.
(e) Nothing
in this Agreement shall be construed to prohibit Company from availing itself
of
any other remedy, in law or equity, arising out of breach of agreement by
Executive, and the parties agree that all remedies available to Company are
cumulative. If the periods of time or the area specified in this
Section are adjudged to be unreasonable in any proceeding, then the period
of
time shall be reduced by such number of months or the scope of non-competition
reduced, such that such restrictions may be enforced for such time and such
scope as adjudged to be reasonable. This agreement shall be governed
by the laws of the state of New Jersey, without regard to choice of law
principles.
6. Assignment
of Inventions
Except
to
the extent otherwise governed by agreements to which the Company is a party,
all
processes, inventions, patents, copyrights, trademarks, and other intangible
rights (collectively the "Inventions") that may be conceived or
developed by Executive, either alone or with others, during the term
of Executive’s employment, whether or not conceived or developed during
Executive’s working hours, and with respect to which the equipment,
supplies, facilities, or trade secret information of Company was
used, or that relate at the time of conception or reduction to practice of
the
Invention to the business of the Company or to Company's actual or
demonstrably anticipated research and development, or that
result from any work performed by Executive for Company, will be the
sole property of Company, and Executive hereby assigns to the Company
all of Executive’s right, title and interest in and to
such Inventions. Executive must execute all
documents, including patent applications and assignments, required by
Company to establish Company's rights under this
Section.
7. Miscellaneous
7.1 Waiver
The
waiver of any breach of any provision of this Agreement will not operate or
be
construed as a waiver of any subsequent breach of the same or other
provision of this Agreement.
7.2 Entire
Agreement; Modification
Except
as
otherwise provided in the Agreement, this
Agreement represents the entire understanding among the parties with
respect to the subject matter of this Agreement, and this Agreement
supersedes any and all prior understandings, agreements, plans, and
negotiations, whether written or oral, with respect to the subject
matter hereof, including without limitation, any understandings,
agreements, or obligations respecting any past or future compensation,
bonuses, reimbursements, or other payments to Executive from
Company. All modifications to the Agreement must be in
writing and signed by the party against whom enforcement of such modification
is
sought.
7.3 Notice
All
notices and other communications under this Agreement must be in writing and
must be given by personal delivery, nationally recognized overnight
courier service, or first class mail, certified or registered with return
receipt requested, and will be deemed to have been duly given upon
receipt if personally delivered, upon delivery by overnight courier
service, five days after mailing, if mailed, to the
respective persons named below:
|
If
to Company:
|
Metropolitan
Computing Corporation.
|
|
|
0
Xxxxx Xxxxxx Xxxx
|
|
Xxxx
Xxxxxxx , Xxx Xxxxxx 00000
|
|
|
If
to Executive:
|
Xxxxxxx
Xxxxx
|
|
0
Xxxxxxxxx Xxxx
|
|
|
Xxxx
Xxxxxx, XX 00000
|
Any
party
may change such party's address for notices by notice duly given pursuant to
this Section.
7.4 Headings
The
Section headings of this Agreement are intended for reference and may not by
themselves determine the construction or interpretation of this
Agreement.
7.5 Governing
Law
This
Agreement is to be governed by and construed in accordance with the laws of
the
State of New Jersey applicable to contracts entered into and wholly
to be performed within the State of New Jersey by New Jersey
residents. Any controversy or claim arising out of or relating to
this Agreement, or the formation, interpretation, enforcement or breach, of
this
Agreement , other than requests for injunctions or preliminary relief, shall
be
settled by arbitration in Morristown, NJ by a single
arbitrator in accordance with the Commercial Arbitration Rules of the
American Arbitration Association utilizing Expedited Procedures. The
arbitration award shall be final and binding regardless of whether one of the
parties fails or refuses to participate in the arbitration and shall be
enforceable by any court having jurisdiction. Each party will pay the fees
of
his own attorneys, and the expenses of his or her witnesses and all other
expenses connected with presenting his case. Other costs
of the arbitration, including the cost of any record or transcripts of
the arbitration, administrative fees, and all other fees and costs,
will be borne equally by the parties.
7.6 Survival
of Company's Obligations
This
Agreement will be binding on, and inure to the benefit of, the
executors, administrators, heirs, successors, and assigns of the
parties; provided, however, that this Agreement may not be assigned by
Executive.
7.7 Counterparts
This
Agreement may be executed in one or more counterparts, all of which taken
together will constitute one and the same Agreement.
7.8 Enforcement
If
any
portion of this Agreement is determined to be invalid or unenforceable, that
portion of this Agreement will be adjusted, rather than voided, to
achieve the intent of the parties under this Agreement.
7.9 Indemnification
The
Company agrees that it will indemnify and hold the Executive harmless to the
fullest extent permitted by New Jersey law from and against any loss,
cost, expense or liability resulting from or by reason of the fact of
the Executive’s employment hereunder, whether as an officer, employee, agent,
fiduciary, director or other official of the Company, except to the
extent of any expenses, costs, judgments, fines or settlement amounts
which result from conduct which is determined by a court of competent
jurisdiction to be knowingly fraudulent or deliberately
dishonest
IN
WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the day and year first
above written.
METROPOLITAN
COMPUTING
CORPORATION
|
By:
_____________________
|
_____________________
|
| Xxxxxxx Xxxxx | |
|
Title:
___________________
|
