EMPLOYMENT AGREEMENT
Between
Xxxxxx X. Xxxxxx
And
Airtrax, Inc.
December 1, 2006 -November 30, 2008
This Employment Agreement ("Agreement") is dated as of December 1, 2006,
between Airtrax, Inc. (the "Company") and Xxxxxx X. Xxxxxx (the "Employee").
1. For good and valued consideration, the Company employs the Employee on
the following terms and conditions.
2. Term of Employment: Subject to the provisions for termination set forth
in this Agreement, the employment began on December 1, 2006, and shall continue
through November 30, 2008, unless sooner terminated as provided herein.
3. Salary Year One: The Company shall pay Employee a base salary of
$150,000 commencing December 1, 2006 through November 30, 2007, for the services
of the Employee, payable each weekly payroll period or as otherwise determined
by mutual agreement of the Employee and the Company.
a. The Company will reimburse the Employee on the first day of each month
for cost of his existing health insurance policy with AETNA Insurance
Company, or some other health insurance policy selected by Employee.
The amount of this health insurance policy reimbursement shall not
exceed $1,500.00 per month.
b. The Company shall reimburse Employee up to $2,200.00 per month for the
life insurance premiums payable to North Western Mutual Life Insurance
Company for the life insurance policies currently in full force and
effect and owned by Employee, or such other life insurance policy
selected by Employee.
c. The salary will be evaluated, for possible increases only, from time
to time by the Board of Directors with periodic quarterly reviews.
d. The Employee shall immediately receive options to purchase 300,000
shares of Common Stock of the Company upon execution of this Agreement
at the rate equal to $0.46 per share. All options shall have a
cashless exercise.
e. As an inducement for the execution of this Agreement, the Company
shall pay Employee a start-up bonus in the amount of $50,000.00 upon
execution of this Agreement for services rendered by Employee prior to
the execution hereof
f. The Company shall use its best efforts to acquire and immediately add
Employee to the Directors and Officers Liability Insurance Policy of
the Company and agrees to save, defend and hold Employee harmless from
any and all such claims, except for fraud, intentional misconduct, or
gross negligence.
4, Salary Year Two: From December 1, 2007 through November 30, 2008, the
Company shall pay Employee a base salary of $200,000.00 for the services of the
Employee, payable each weekly payroll period or as otherwise determined by
mutual agreement of the Employee and the Company.
a. The Company will reimburse the Employee on the first day of each month
for cost of his existing health insurance policy with AETNA Insurance
Company, or some other policy selected by Employee. The amount of this
health insurance reimbursement shall not exceed $1,500.00 per month.
b. The Company shall reimburse Employee for up to $2,200.00 per month for
life insurance premiums payable to North Western Mutual Life Insurance
Company for life insurance policies currently in full force and effect
and owned by Employee, or such other life insurance policy selected by
Employee.
c. The salary will be evaluated, for possible increases only, from time
to time by the Board of Directors with periodic quarterly reviews.
d. On December 1, 2007, the Employee shall immediately receive options to
purchase 200,000 shares of Common Stock of the Company at the rate
equal to $0.46 per share. All options shall have a cashless exercise.
e. On June 1, 2008, the Employee shall immediately receive options to
purchase 200,000 shares of Common Stock of the Company at the rate
equal to $0.46 per share. All options shall have a cashless exercise.
f. The Company shall use its best efforts to acquire and immediately add
Employee to the Directors and Officers Liability Insurance Policy of
the Company and agrees to save, defend and hold Employee harmless from
any and all such claims, except for fraud, intentional misconduct, or
gross negligence.
5. Stock Options: Stock purchase options offered as a part of this
Agreement have no relationship to and are completely separate from any other
options offered Employee or any affiliate of Employee, as a result of services
provided to the Company, in any other capacity.
All stock purchase options shall be issued free of any Company imposed
restrictions but will be subject to all restrictions and/or legends imposed by
the Securities and Exchange Commission or any other federal or state statutes
governing such transactions.
6. Bonus: Employee shall be entitled to receive a bonus(s) from time to
time. Bonuses shall require Board of Director approval. In the event that the
Employee participates, and has an active role in assisting the Company in a
restructuring, which includes, but is not limited to, a business combination,
merger or reverse merger, then the Board of Directors agrees to award the
Employee, a cash and stock purchase option bonus in the amount that would be
deemed customary for publically traded corporations for these extraordinary
efforts.
7. Holidays: The Company will provide, at a minimum, the following paid
holidays: New Years, Easter, Memorial Day, Independence Day, Labor Day,
Thanksgiving, Christmas, and all other days which Company is closed for normal
business.
8. Duties and Position: The Company employs the Employee in the capacity of
President and Chief Executive Officer.
a. Duties shall include general management of the Company including
sales, purchasing, financing, human resources, manufacturing, public
relations, marketing or any other duties necessary for the proper
functioning or management of the Company. The Employee's duties may be
modified at the Company's reasonable discretion from time to time.
b. The Company may use the Employee's name in advertisements, press
releases or in any other manner that is beneficial to the Company
providing all information so published is truthful and not detrimental
to the Employee. The Employee shall make known to the Board of
Directors any reason the Company should not use the Employee's name
prior to such use.
c. Employee agrees to devote full time to his job with the Company. The
Employee will devote his attention and energies to the business of the
Company. During this employment, Employee may engage in any other
business and volunteer activities, regardless of whether such activity
is pursued for profit, gain, or other pecuniary advantage. Employee is
not prohibited from making personal investments in any other
businesses provided those investments do not require substantial
active involvement in the operation of said companies. The current
activities and investments by Employee have been approved by the
Company.
9. Confidentiality of Proprietary Information: Employee agrees, during or
after the term of this Agreement, not to reveal confidential information, or
trade secrets, to any person, firm, Company, or entity other than as appropriate
as a function of his employment, or for the benefit of the Company. Should
Employee reveal or threaten to reveal this information to the detriment of the
Company, the Company shall be entitled to an injunction restraining the Employee
from disclosing same, or from rendering any services to any entity to whom said
information has been or is threatened to be disclosed.
10. Reimbursement of Expenses: The Employee shall incur reasonable expenses
for furthering the Company's business, including expenses for entertainment,
travel, and similar items. The Company shall reimburse Employee for all business
expenses promptly upon presentment of an itemized account of expenditures,
pursuant to Company policy.
11. Vacation: The Employee shall be entitled to a yearly vacation of 4
weeks at full pay. Vacations not taken by the Employee may accrue or be taken in
the form of additional payroll at the Employee's discretion. Vacation
reimbursement taken in the form of additional payroll will be paid at the salary
rate current at the time the additional payroll or vacation is actually taken.
12. Disability: If Employee cannot perform a significant portion of his
duties because of illness or incapacity, for a continuous period of more than
three (3) months, the base salary otherwise due, (less any amounts received
directly by Employee from state disability payments or other disability
insurance paid for by Employer) shall continue to be paid by Employee. After
this three (3) month period, during said continuing illness or incapacity, the
Employer may reduce the base salary paid to Employee by up to fifty percent
(50%). The Employee's full compensation will be reinstated upon his return to
work.
a. If Employee, at any time during the term of this Agreement, should be
unable, because of personal injury, illness, or any other cause to
substantially perform his duties, the Company may assign the Employee
to other reasonable duties.
b. If the Employee is unwilling to accept the reasonable modification in
his duties by the Company, or if the Employee's inability to perform
is of such an extent to make a modification of duties hereunder not
feasible, this Agreement may terminate upon the mutual consent of the
Company and Employee.
13. Termination of Agreement: Without cause, the Company may terminate this
Agreement at any time upon 30 days' prior written notice to the Employee.
However, upon Company's request, the Employee will continue to perform his
duties, and be paid his regular compensation up to the date of termination. Upon
termination of this Agreement pursuant to this Paragraph 13, the Company will
pay the Employee on the date of termination a severance allowance equal to one
full year of salary, less taxes and social security required to be withheld from
wages, and his health insurance and life insurance premium reimbursements for
one year.
Upon a change in control of the Company, the Employee may terminate his
employment upon 30 days prior written notice to the Company. A change of control
shall include, but not be limited to, a change in the board of directors of
Company, by 45% or more of its members or a change in stock ownership of the
Company by 45% or more of its shareholders. Upon termination of this Agreement
pursuant to a change in control the Company will pay the Employee on the date of
termination a severance allowance equal to one full year of salary, less taxes
and social security required to be withheld from wages, and his health insurance
and life insurance premium reimbursements for one year.
14. Notwithstanding anything to the contrary contained in this Agreement,
the Company may terminate this Agreement upon 30 days' prior notice to Employee
should any of the following events occur:
a. The sale of substantially all of the Company's assets to a single
purchaser, or group of associated purchasers; or
b. The sale, exchange, or other disposition, in one transaction of the
majority of the Company's outstanding corporate shares; or
c. The Company's decision to terminate its business and liquidate its
assets;
d. The merger or consolidation of the Company with another company;
e. Bankruptcy or Chapter 11 Reorganization.
In the event of termination of this Agreement as provided in Paragraph 14,
the Employee shall receive a severance allowance of one-hundred percent (100%)
of all obligations of Company for the benefit of Employee for the entire full
teen of this Agreement.
15. In the event of termination of this Agreement for any reason, except
fraud, criminal violations or good cause, then all stock options to be received
by Employee shall immediately become fully vested and the Employee shall be
permitted to exercise all stock purchase options due and not previously
exercised. The Company shall provide Employee with all Company obligations
incurred under such options.
16. Death Benefit: Should Employee die during the term of employment, the
Company shall pay to Employee's estate and/or provide for his surviving spouse,
any compensation due through the end of the month in which the death occurred
plus three (3) additional months of all salary and other health insurance
benefits provided herein.
17. Restriction on Post Employment: For a period of eighteen (18) months
after the end of employment, the Employee shall not control, consult to or be
employed by any omni directional technology business, similar to that conducted
by the Company, either by soliciting any of its accounts or by operating within
Employer's general trading area, except as an employee of any successor or
affiliated company with the Company. In the event the Company seeks protection
under the bankruptcy or insolvency laws, or has been liquidated or dissolved,
this Paragraph 17 shall be null and void.
18. Assistance in Litigation: Employee shall upon reasonable notice,
furnish such information and provide assistance to the Company as it may
reasonably require in connection with any litigation in which it is, or may
become, a party either during or after employment. If the Employee is no longer
a full time employee of the Company, the Company shall pay Employee a minimum
fee of $5,000.00 and an hourly fee of $250.00 for Employee's time for assistance
in litigation.
19. Upon execution hereof, Employee shall be reimbursed for his actual
legal fees incurred for the review and modification of this Agreement.
20. Effect of Prior Agreements: This Agreement supersedes any prior
agreement between the Company or any predecessor of the Company and the
Employee, except that this Agreement shall not affect or operate to reduce any
benefit or compensation inuring to the Employee of a kind elsewhere provided and
not expressly provided in this Agreement.
21. Settlement by Arbitration: Any claim or controversy that arises out of
or relates to this Agreement, or the breach of it, shall be settled by
arbitration in accordance with the rules of the American Arbitration
Association. Judgment upon the award rendered may be entered in any Court with
jurisdiction. The venue for legal process under the terms of this Agreement is
the State of New Jersey.
22. Limited Effect of Waiver by Company: Should Company waive breach of any
provision of this Agreement by the Employee, that waiver will not operate or be
construed as a waiver of further breach by the Employee.
23. Severability: If, for any reason, any provision of this Agreement is
held invalid, all other provisions of this Agreement shall remain in effect. If
this Agreement is held invalid or cannot be enforced, then to the full extent
permitted by law any prior agreement between the Company (or any predecessor
thereof} and the Employee shall be deemed reinstated as if this Agreement had
not been executed.
24. Assumption of Agreement by Company's Successors and Assignees: The
Company's rights and obligations under this Agreement will inure to the benefit
and be binding upon the Company's successors and assignees.
25. Oral Modifications Not Binding: This Agreement is the entire agreement
of the Company and the Employee. Oral changes shall have no effect. It may be
altered only by a written agreement signed by the party against whom enforcement
of any waiver, change, modification, extension, or discharge is sought.
AS WITESS the hands and seals of the parties hereto:
COMPANY:
Board of Directors Airtrax, Inc.
Xxxxxx Xxxxxxxx, Chairman of the Board /s/ Xxxxxx Guzzetti_______________(SEAL)
Xxxxx Xxxxxx /s/ Xxxxx Hudson____________________________________________(SEAL)
D. Xxxxxx Xxxxxx /s/ X. Xxxxxx Harris____________________________________(SEAL)
Xxxxxxx Xxxxxxxxxxx /s/ Xxxxxxx Hungerville______________________________(SEAL)
Fil Filipov /s/ Fil Filipov______________________________________________(SEAL)
Xxxxxx Xxxxxx /s/ Xxxxxx Borski__________________________________________(SEAL)
EMPLOYEE:
/s/ Xxxxxx X. Xxxxxx
-----------------------
(SEAL) Xxxxxx X. Xxxxxx
