Exhibit 10.1


 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT, entered into
August 13, 2020 by and between Rego Payment Architectures, Inc., a Delaware corporation (the “Company”) and Peter S.
Pelullo (the “Employee”).


 


WITNESSETH:


 


WHEREAS, the Company wishes to employ the
Employee as President, Chief Executive Officer, and Board Director of the Company and the Employee is willing to serve the Company
in such capacity.


 


NOW, THEREFORE, in consideration of the
mutual covenants contained herein, and other good and valuable consideration, the parties hereto agree as follows:


 


Section 1.     Employment


 


The Company will employ the Employee, and
the Employee will perform services for the Company and its subsidiaries, on the terms and conditions set forth in this Agreement.


 


Section 2.     Duties


 


The Employee will serve the Company as its
President, Chief Executive Officer and Board Director. The Employee will have such duties and responsibilities as are assigned
to him by the Board of Directors of the Company commensurate with the Employee’s position, including responsibility for all
strategic and operational matters relating to the Company and its subsidiaries, subject to the direction of the Board of Directors.
The Employee will perform his duties hereunder faithfully and to the best of his abilities and in furtherance of the business of
the Company and its subsidiaries, and will devote his full business time, energy, attention and skill to the business of the Company
and its subsidiaries and to the promotion of its interests, except as otherwise agreed by the Company.


 


Section 3.     Term 


 


This Agreement shall have an initial term
of two years, beginning as of the Employee’s first day of work, August 13, 2020 (the “Effective Date”). It shall
renew for successive one-year periods unless either party gives notice of intent to not renew this Agreement at least 60 days prior
to the renewal date. Notwithstanding the foregoing Section 3, this Agreement and the Employee’s employment hereunder shall
be “at will” and is terminable at any time by either party, without further economic obligation beyond the termination
date except as required by law.


 



    	 	 	 



    	 



    




 


Section 4.     Salary


 


The Employee will receive as compensation
for his duties and obligations to the Company pursuant to this Agreement during its effectiveness a base salary at the annual rate
of (i) Two Hundred Thousand Dollars ($200,000) during the first year after the Effective Date,


 


(ii) It is agreed between the parties that
the Company will review the base annual salary annually and, in light of such review, may (but will not be obligated to), in the
discretion of the Board of Directors of the Company or any Compensation Committee thereof, increase such applicable annual base
salary taking into account any change in the Employee’s responsibilities, increases in the cost of living, performance by
the Employee, and other pertinent factors.


 


Section 5.     Bonus


 


The Employee will be eligible for an annual
bonus in the form of cash or Company common stock as determined at the sole discretion of the Board of Directors of the Company
or any Compensation Committee thereof.


 


Annual bonuses payable hereunder shall be
calculated after the close of the end of the calendar year, and thereafter paid in a single lump sum by no later than the 15th
day of the third month following the end of the calendar year in which the right to the bonus is no longer subject to a substantial
risk of forfeiture (as defined for purposes of Internal Revenue Code Section 409A, including Treasury Regulations Section 1.409A-1(d)).


 


Section 6.     Equity Compensation


 


(a)       Options.
As of the Effective Date or promptly thereafter following approval of the Board of Directors of the Company, the Employee will
be granted a non-statutory stock option to acquire 500,000 shares of the common stock of the Company at an exercise price of $0.25
per share (or if greater, the fair market value of such stock on the grant date). The option will vest immediately. The grant of
options will be memorialized in, and the options subject to, a separate option agreement to be entered into between the Employee
and Company in accordance with the existing equity incentive plans of the Company. Upon the sale or change in control of more than
50% of the Company, the Employee will be granted a non-statutory stock option to acquire 500,000 shares of the common stock of
the Company at the exercise price of the closing price per share on the date of sale or change of control (or if greater, the fair
market value of such stock on the grant date). The option will vest immediately upon issuance. The grant of options will be memorialized
in, and the options subject to, a separate option agreement to be entered into between the Employee and Company in accordance with
the existing equity incentive plans of the Company.


 


(b)       Common
Stock. As of the Effective Date or promptly thereafter following approval of the Board of Directors of the Company, the Employee
will be granted 250,000 shares of the common stock of the Company. The shares will vest immediately. Upon the sale of the Company
or change in control of more than 50% of the Company, the Employee will be granted 250,000 shares of the common stock of the Company.
The shares will vest immediately.


 



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Section 7.     Employee
Benefits


 


Subject to any applicable probationary or
similar periods, during the period of his employment with the Company, the Employee will be entitled to participate in all employee
benefit programs of the Company applicable to senior officers of the Company, as such programs may be in effect from time to time.
Subject to any applicable probationary or similar periods, during his period of employment with the Company, the Employee will
also be entitled to participate in all retirement programs of the Company for which current employees are eligible, as such programs
may be in effect from time to time (including the Company’s 401(k) plan).


 


Section 8.     Business Expenses


 


All reasonable travel and other out-of-pocket
expenses incidental to the rendering of services by the Employee hereunder will be paid by the Company, and, if expenses are paid
in the first instance by the Employee, the Company will reimburse his therefor upon presentation of proper invoices, subject in
each case to compliance with the Company’s reimbursement policies and procedures. All reimbursements will be paid in the
same taxable year in which the expense is incurred, provided that expenses incurred toward the end of the calendar year that cannot
administratively be reimbursed before the year end shall be reimbursed by no later than March 15th of the calendar year
following the calendar year in which the expense was incurred.


 


Section 9.     Vacations and
Sick Leave


 


The Employee will be entitled to holidays,
reasonable vacation and reasonable sick leave each year, in accordance with policies of the Company, as determined by the Board
of Directors, provided, however, that the Employee will be entitled to a minimum of four (4) weeks’ vacation per year.


 


Section 10.     Confidential
Information


 


The Employee agrees to keep secret and retain
in the strictest confidence all confidential matters which relate to the Company or any affiliate of the Company, including, without
limitation, customer lists, client lists, trade secrets, pricing policies and other business affairs of the Company and any affiliate
of the Company learned by his from the Company or any such affiliate or otherwise before or after the date of this Agreement, and
not to disclose any such confidential matter to anyone outside the Company, or any of its affiliates, whether during or after her
period of service with the Company, except as may be required in the course of a legal or governmental proceeding. Upon request
by the Company, the Employee agrees to deliver promptly to the Company upon termination of his services for the Company, or at
any time thereafter as the Company may request, all Company or affiliate memoranda, notes, records, reports, manuals, drawings,
designs, computer files in any media and other documents (and all copies thereof) relating to the Company’s or any affiliate’s
business and all property of the Company or any affiliate associated therewith, which she may then possess or have under his control.


 



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Section 11.     Successors and
Assigns


 


This Agreement will be binding upon and
inure to the benefit of the Employee, his heirs, executors, administrators and beneficiaries, and the Company and its successors
and assigns.


 


Section 12.     Governing Law


 


This Agreement will be governed by and construed
and enforced in accordance with the laws of the State of Pennsylvania, without reference to rules relating to conflicts of law.


 


Section 13.     Entire Agreement


 


This Agreement constitutes the full and
complete understanding and agreement of the parties and supersedes all prior understandings and agreements as to employment of
the Employee. This Agreement cannot be amended, changed, modified or terminated without the written consent of the parties hereto.


 


Section 14.     Waiver of Breach


 


The waiver of either party of a breach of
any term of this Agreement will not operate nor be construed as a waiver of any subsequent breach thereof.


 


Section 15.     Notices


 


Any notice, report, request or other communication
given under this Agreement will be written and will be effective upon delivery when delivered personally, by overnight courier
or by fax. Unless otherwise notified by any of the parties, notices will be sent to the parties as follows: (i) if to the Employee,
at the address set forth in the Company’s records; and (ii) if to the Company, to Rego Payment Architectures, Inc. 21171
South Western, Suite 2705 Torrance, CA 90501. Attention: Board of Directors.


 


Section 16.     Severability


 


If any one or more of the provisions contained
in this Agreement will be invalid, illegal or unenforceable in any respect under any applicable law, the validity, legality and
enforceability of the remaining provisions contained herein will not in any way be affected or impaired thereby.


 


Section 17.     Counterparts


 


This Agreement may be executed in counterparts,
each of which will be deemed to be an original but all of which together will constitute one and the same instrument. Delivery
of signatures by facsimile or electronic image shall be valid for all purposes hereunder.


 


Section 18.     Internal Revenue
Code Section 409A Compliance.


 


(a)       The
parties hereto recognize that certain provisions of this Agreement may be affected by Section 409A of the Internal Revenue Code
and guidance issued thereunder, and agree to amend this Agreement, or take such other action as may be necessary or advisable,
to comply with Section 409A.


 



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(b)       Notwithstanding
anything herein to the contrary, it is expressly understood that at any time the Company (or any successor or related employer
treated as the service recipient for purposes of Internal Revenue Code Section 409A) is publicly traded on an established securities
market (as defined for purposes of Internal Revenue Code Section 409A), if a payment or provision of an amount or benefit constituting
a deferral of compensation is to be made pursuant to the terms of this Agreement to the Employee on account of a Separation from
Service at a time when the Employee is a Specified Employee (as defined for purposes of Internal Revenue Code Section 409A(a)(2)(B)(i)),
such deferred compensation shall not be paid to the Employee prior to the date that is six (6) months after the Separation from
Service or as otherwise permitted under Treasury Regulations Section 1.409A-3(i)(2).


 


(c)       For
purposes of this Agreement, the following definitions shall apply:


 


		(i)	“Separation from Service” means, generally, a termination of employment with the Company (or any successor or related
employer treated as the service recipient for purposes of Internal Revenue Code Section 409A), and shall have the same meaning
as such term has for purposes of Internal Revenue Code Section 409A (including Treasury Regulation Section 1.409A-1(h)).



 


		(ii)	“Involuntary Separation from Service” means a Separation from Service due to the independent exercise of the unilateral
authority of the Company (or any successor or related employer treated as the service recipient for purposes of Internal Revenue
Code Section 409A) to terminate the Employee’s employment, other than due to the Employee’s implicit or explicit request,
where the Employee was willing and able to continue employment with the Company. Notwithstanding the foregoing, a termination for
Good Reason may constitute an Involuntary Separation from Service. Involuntary Separation from Service shall have the same meaning
as such term has for purposes of Internal Revenue Code Section 409A (including Treasury Regulation Section 1.409A-1(n)).



 


[signature page follows]


 



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


 


The Company:


 


REGO PAYMENT ARCHITECTURES, INC.


 


 


 


	By:	/s/ Scott A. McPherson	 
	Name:	Scott A. McPherson	 
	Title: 	Chief Financial Officer	 
	 

         

         
	 	 
	Employee:	 
	 	 	 
	 	 	 
	 	 	 
	/s/ Peter S. Pelullo	 
	Peter S. Pelullo	 	 


 


 


 


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