fsb2ex10d_petecology.htm


    EMPLOYMENT
      AGREEMENT

    


    This
      Employment Agreement (“Agreement”)  is entered into by and between Pet
      Ecology Brands, Inc., a Texas corporation (“Company”), and Robert J. Salluzzo,
      an individual (“Employee”).  Company and Employee are collectively
      referred to as the “Parties”.  This Agreement supersedes any and all
      prior consulting and employment  agreements between the
      Parties.

    


    R  E  C  I  T  A  L  S:

    


    WHEREAS,
Company,
      is engaged
      in developing, marketing and selling pet products in the United States and
      other
      countries; and,

    


    WHEREAS,
      Employee is
      experienced in and has knowledge of the Company's business and has been elected
      to the Company’s Board of Directors and has been appointed, and is currently
      serving as the Company’s Vice-President/Treasurer  and Chief Operating
      and Financial  Officer; and

    


    WHEREAS,
      the Company and
      Employee desire Employee to perform duties on behalf of the Company pursuant
      to
      the terms hereof; and,

    


    WHEREAS,
      Employee and Company
      heretofore entered into a Consulting Agreement dated as of December 1, 2006
      which this Agreement supersedes and replaces;

    


    Now,
      therefore, for and in
      consideration of the terms and conditions contained herein, the Parties agree
      as
      follows, to wit:

    


    
      	
              1.  

            	
              Definitions.  As
                used in this Agreement:

            


    

     

    
      	
              A.  

            	
               “Company”
                means
                Pet Ecology Brands, Inc., its successors and assigns, and any of
                its
                present or future subsidiaries or organizations controlled by,
                controlling, or under common control with
                it.

            


    

     

    
      	
              B.  

            	
              “Confidential
                Information” means any and all information disclosed or made
                available to the Employee or known by the Employee as a direct or
                indirect
                consequence of or through Employee’s employment by the Company and not
                generally known in the industry in which the Company is or may become
                engaged, or any information related to the Company’s products, processes,
                or services, including, but not limited to, information relating
                to
                research, development, inventions, manufacture, purchasing, accounting,
                engineering, marketing, merchandising, or
                selling.

            


    

     

    
      	
              C.  

            	
              “Inventions”
                mean
                discoveries, concepts and ideas, whether patentable or not, relating
                to
                any present or prospective activities of the Company, including,
                but not
                limited to, devices, processes, methods, formulae, techniques,
                applications, technology and any improvements to the
                foregoing.

            


    

     

    
      	
              D.  

            	
              “Company
                Monthly Base Pay”
                means the employee’s last monthly remuneration, prior to
                termination of Employee’s employment with the Company, before federal,
                state, and local taxes and other withholding, but exclusive of extra
                compensation, such as that attributable to bonuses, overtime or employee
                retirement or pension benefits.

            


    

     

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    
      	
              E.  

            	
              “Conflicting
                Organization” means any person or organization engaged, directly or
                indirectly, in the research, development, production, marketing or
                selling
                of a Conflicting Product.

            


    

     

    
      	
              F.  

            	
              “Conflicting
                Product”
                means any product, process, technology, application, or service of
                any
                person or organization, other than the Company, in existence or under
                development, which resembles, competes with or is marketed or offered
                for
                sale or lease to the same or similar potential customers as a product,
                process, technology, application, or service which is the subject
                of
                research, development, production, marketing or selling activities
                of the
                Company.

            


    

     

    
      	
              2.  

            	
              Employment.
                The Company
                hereby employs the Employee and the Employee hereby agrees to accept
                employment with the Company upon the terms and conditions herein
                set
                forth.

            


    

     

    
      	
              3.  

            	
              Term.  The
                Company hereby employs the Employee for a period of three (3) years
                beginning on the December 7, 2007 and ending on December 6, 2010,
                unless
                sooner terminated as provided in Section 13 (Disability), Section
                14
                (Death During Employment) or Section 12 (Termination), hereof; provided,
                this Agreement may be extended for additional periods or its terms
                amended
                upon the mutual written agreement of the
                Parties.

            


    

     

    
      	
              4.  

            	
              Position.  The
                Employee shall be employed in the capacity of Vice-President/Treasurer
                to
                serve as Chief Operating Officer and Chief Financial Officer with
                such
                duties as are set for the in the Bylaws of the Company and as are
                or may
                be reasonably prescribed, from time to time, by the Board of Directors
                of
                the Company.  The Employee shall not be assigned nor requested
                to perform duties or functions for which he has not been adequately
                trained or for which he does not have adequate education and/or
                professional experience.

            


    

     

    
      	
              5.  

            	
              Extent
                of
                Services.  The Employee shall diligently and
                conscientiously devote Employee’s time, attention and energies to the
                business of the Company.

            


    

     

    
      	
              6.  

            	
              Working
                Facilities;
                Location.  The Employee shall be furnished with such
                facilities suitable to Employee’s position and adequate for the
                performance of Employee’s duties and the conduct of the Company’s
                business.   The Employee’s principal office shall be
                located in the area selected by the Company; provided, however, the
                Employee agrees to do such traveling as is required to carry out
                Employee’s duties hereunder. The Employee shall not be transferred from
                the Company’s Dallas, Texas Operations on a permanent basis (longer than
                thirty (30) days) without the Employee’s written
                consent.

            


    

     

    
      	
              7.  

            	
              Compensation.  The
                Company’s Board of Directors may increase the Employee’s Monthly Base Pay
                from time to time as the Board may deem reasonable.  The
                Employee shall be a participant in any deferred compensation, bonus
                and/or
                stock option plans designed and implemented by the Company’s Board of
                Directors for the benefit of the Company’s key executives and
                employees.   The Employee shall participate in any such
                plans at a level commensurate with Employee’s position with the
                Company.

            


    

     

    
      	
              A.  

            	
              Company
                Monthly Base
                Pay. For  services rendered by Employee under this
                Agreement, until any increases shall be made by a decision
                of  the Board of Directors, Employee shall be paid an annual
                base salary of One Hundred Twenty Thousand Dollars ($120,000) per
                year,
                beginning January 1, 2008.  The annual base salary shall be paid
                to Employee in equal bi-monthly installments as Company Monthly Base
                Pay.

            


    

     

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

     

    
      	
              B.  

            	
              Stock
                Grants. Employee
                shall be entitled to receive non qualified stock options in amounts
                and
                pursuant to the terms and conditions of a Stock Option Agreement
                of even
                date herewith.

            


    

     

    
      	
              C.  

            	
              Benefits.
Employee
                shall
                be eligible for Company-paid health insurance, dental insurance,
                life
                insurance, short/long term disability coverage and other benefits
                that are
                and may become available. Employee shall be eligible to participate
                in any
                such benefits at a level commensurate with Employee’s position with the
                Company.

            


    

     

    
      	
              D.  

            	
              Auto
                Allowance. Employee shall be
                provided a $500 monthly auto
                allowance.

            


    

     

    
      	
              E.  

            	
              Temporary
                Housing; Travel to
                N.Y.  Employee shall be reimbursed for temporary housing
                and air travel to and from Employee’s home in  the State of New
                York to   a  maximum amount of $2,000 per month
                for a period of 24 months from the date of this
                Agreement.

            


    

     

    


    
      	
              8.  

            	
              Expenses.  All
                expenses for transportation and travel, including a primarily business
                use
                automobile, entertainment, club dues, and charitable contributions
                incurred by the Employee, that may be properly charged to the furtherance
                of the legitimate business interests of the Company shall be reimbursed
                or
                directly paid by the Company upon presentment of receipts in accordance
                with the record keeping requirements of the Internal Revenue
                Service.

            


    

     

    
      	
              9.  

            	
              Right
                to
                Participate.  The Employee shall have the right to
                participate in all other benefits of employment generally made available
                to the Company’s executive and managerial employees including but not
                limited to medical, dental, disability, life insurance, retirement
                plans
                and any other benefit(s) presented by the Company’s Board of Directors and
                befitting the Employee’s position and
                performance.

            


    

     

    
      	
              10.  

            	
              Vacations;
                Compensated
                Absences.  The Employee shall be entitled to twenty (20)
                working days vacation each calendar year, with continued compensation
                during such vacation period.   For purposes hereunder, the
                term “working days” refers to Monday through Friday, exclusive of weekends
                and holidays, observed by the Company as determined by the Board
                of
                Directors.  Vacations may be taken at such times and in such
                manner desired by the Employee if the taking of such vacation does
                not
                interfere with the efficient administration of the affairs of the
                Company
                as may reasonably be determined by the Board of
                Directors.   Unused vacation days may  be carried
                into the next calendar year (s) or, at Employee’s option, Employee may
                elect to  receive compensation for unused vacation days. In
                addition, Employee shall be entitled to continued  compensation
                pursuant to the terms hereof for sick days and other days or times
                during
                which Employee is necessarily absent as a result of family or other
                reasonable personal obligations.

            


    

     

    
      	
              11.  

            	
              Right
                to
                Inventions.  With respect to all Inventions made or
                conceived by the Employee, whether or not during the hours of Employee’s
                employment or with the use of Company facilities, materials or personnel,
                either solely or jointly with others, during the term of Employee’s
                employment by the Company, and without royalty or any other
                consideration:

            


    

     

    
      	
              A.

            	
              Reports.  The
                Employee shall inform the Company promptly and fully of such inventions
                by
                a written report, setting forth in detail the structures, procedures,
                and
                methodology employed and the result achieved.   A report
                shall also be submitted by the Employee upon completion of any study
                or
                research project undertaken on the Company’s behalf, whether or not in the
                Employee’s opinion a given study or project has resulted in an invention.
                

            


    

     

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    
      	
              B.  

            	
              Assignment.  The
                Employee hereby assigns and agrees to assign to the Company all of
                Employee’s rights to such Inventions and to all proprietary right therein,
                based thereon or related thereto, including, but not limited to,
                applications for United States and foreign letters patent and resulting
                letters patent.

            


    

     

    
      	
              C.  

            	
              Patents.  At
                the Company’s request and expense, the Employee shall execute such
                documents and provide such assistance as may be deemed necessary
                by the
                Company to apply for, defend or enforce any United States or foreign
                letters of patent based on or related to such
                Inventions.

            


    

     

    
      	
              D.  

            	
              Confidential
                Information.

            


    

     

    
      	
              (i)  

            	
              Confidentiality.  During
                the terms of this Agreement, Company shall disclose to Employee certain
                Confidential Information as that term is defined herein.  Except
                as required in the performance of Employee’s duties during the term of
                Employee’s employment by the Company, the Employee shall treat as
                confidential and shall not, directly or indirectly, use, disseminate,
                disclose, publish, or otherwise make available any Confidential
                Information or any portion thereof.   This provision shall
                remain in effect for a period of two (2) years after any termination
                of
                such employment.

            


    

     

    
      	
              (ii)  

            	
              Return
                of Confidential
                Information.  Upon termination of Employee’s employment
                with the Company, all documents, records, notebooks, and similar
                repositories containing Confidential Information, including copies
                thereof, then in the Employee’s possession, whether prepared by him or
                others, shall be promptly returned to the Company.  If at any
                time after the termination of employment the Employee determines
                that he
                has any Confidential Information in Employee’s possession or control, he
                shall immediately return to the Company all such Confidential Information,
                including all copies and portions
                thereof.

            


    

     

    
      	
              (iii)  

            	
              Restrictive
                Covenants.  In consideration for the Company disclosing
                to Employee Confidential Information, for a period of one (1) year
                after
                termination of Employee’s employment with the Company, the Employee will
                not render services, directly or indirectly, to a Conflicting
                Organization, except that the Employee may accept employment with
                a
                Conflicting Organization if the Company receives, prior to the Employee
                accepting such employment, separate written assurances, satisfactory
                to
                the Company, from such Conflicting Organization and from the Employee
                that
                the Employee will not render services directly or indirectly in connection
                with any Conflicting Product.

            


    

     

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    12. Termination.

     

    a.           
      The Company may terminate Employee's services pursuant to the terms of this
      Agreement at any time for "cause" as herein defined. The term "cause" shall
      mean
      any of the following events: (i) engaging in activities in direct or indirect
      competition with the Company, (ii) committing acts of gross negligence, (iii)
      conviction of a felony or misdemeanor involving moral turpitude, (iv)
      demonstration of any acts of dishonesty or theft on the part of Employee which,
      in the opinion of the President, is detrimental to the best interests of the
      Company, and (v) intentional and material violation by Employee of any written
      policy adopted by the Board of Directors of the Company which is not corrected
      within ten (10) days after receipt by Employee of a detailed written explanation
      from the President of the Company. The Company may also terminate this Agreement
      as a result of the death or disability of Employee pursuant to the applicable
      provisions of Paragraphs 13 or 14 below.

    


    b.           
      "Disability," as that term is used in paragraph 5(a) above, shall be defined
      as
      an incapacity, whether by an accident, sickness or otherwise, which renders
      Employee mentally or physically incapable of performing the services required
      pursuant to this Agreement, and such incapacity, in the opinion of a mutually
      agreeable physician, is expected to continue for a period of twelve (12)
      months.

    


    c.           
      The Company may also terminate this Agreement without “cause” as that term is
      defined in Paragraph 12 a. above or without Employee dying or becoming disabled;
      however, in the event of such termination, Company shall be obligated to continue paying
      Employee’s  full compensation at the rate of base pay in effect at the
      time of the termination for six (6) months following such termination or until
      the end of the term of this Agreement, whichever shall be less.

     

    13.  Disability.  To
      the
      extent not covered by the Company’s disability insurance, if any, if the
      Employee is unable to perform Employee’s services during the term of this
      Agreement by reason of illness or incapacity, he shall receive Employee’s full
      compensation until a determination is made that Employee is disabled as that
      term is defined in Paragraph 12 (b) above, and, in the event this Agreement
      is
      terminated as a result of Employee’s disability,  shall continue
      receiving full compensation at the rate of base pay in effect at the time of
      the
      determination for six (6) months following a determination of disability or
      until the end of the term of this Agreement, whichever shall be
      less.  However, upon a determination of Employee’s disability as
      defined in Paragraph 12 (b) above, any options to purchase the Company’s common
      stock pursuant to the terms of the Stock Option Agreement of even date herewith
      which have not then vested,  shall immediately become vested.

     

    14. Death
      during
      Employment.  If  Employee dies during the term of
      this Agreement, this Agreement shall terminate; provided, however, the Company
      shall continue to pay to the estate of the Employee, on the same schedule as
      if
      Employee were alive, Employee’s salary at the rate of his base pay in effect at
      the time of his death for six (6) months following a determination of disability
      or until the end of the term of this Agreement, whichever shall be
      less.  Additionally, upon Employee’s death, any options to purchase
      the Company’s common stock pursuant to the terms of the Stock Option Agreement
      of even date herewith which have not then vested, shall immediately become
      vested.

     

    15. Non-Competition.  During
      the term of this Agreement and or as long as thereafter as Employee is receiving
      compensation from the Company:

     

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

     

    
      	
              a.  

            	
              The
                Employee shall not engage in competition with the Company, either
                directly
                or indirectly, in any manner or capacity, as advisor, consultant,
                principal, agent, partner, officer, director, stockholder, employee,
                representative, spokesman or otherwise, in any phase of the business
                carried on by the Company at any
                time.

            


    

     

    
      	
              b.  

            	
              For
                a period of one (1) year after the termination of this Agreement,
                Employee
                shall not solicit anyone who was an employee of the Company when
                the
                Employee’s employment with the company terminated or solicit anyone then
                employed by the Company to terminate or refrain from renewing Employee’s
                or her employment with the Company.

            


    

     

    
      	
              c.  

            	
              For
                a period of one (1) year after the termination of this Agreement,
                Employee
                shall not, either directly or indirectly, solicit any customer, broker,
                or
                distributor of the Employer, for such products as are manufactured
                and/or
                sold by the Employer, and Employee will similarly not engage in the
                business of the manufacture and sales of such products as are manufactured
                and/or sold by the employer within the said
                period.

            


    

     

    


     

    16. Notice.  All
      notices
      or other instruments or communications provided for in this Agreement shall
      be
      in writing and signed by the party giving same and shall be deemed properly
      given if delivered in person, including delivery by overnight courier, or if
      sent by registered or certified United States mail, postage prepaid, addressed
      to such party at the address listed below.  Each party may, by notice
      to the other party, specify any other address for the receipt of such notices,
      instruments or communications.

     

    If
      To Company:

    


    Pet
      Ecology Brands, Inc.

    14822
      Venture Drive

    Dallas,
      Texas 75234

    Attn:  President/CFO

    


    If
      To Employee

    


    Robert
      J. Salluzzo CPA PC

    204
      South William Street

    Johnstown,
      New York 12095

    


    17.
      Waiver.  Failure
      to
      insist upon a strict compliance with any of the terms or conditions of this
      Agreement shall not be deemed waiver of such terms or conditions, nor shall
      any
      waiver of any term, condition or right of any party at any time be deemed a
      waiver of any other term, condition or right of any party hereto, nor shall
      it
      preclude the party from subsequently asserting or relying upon such term,
      condition or right.

     

    18. Severability.  The
      invalidity or enforceability of any provision hereof shall in no way affect
      the
      validity or enforceability of any other provision.

     

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

     

    19. Modification.  There
      are no verbal understandings between the Parties.  This Agreement
      contains the entire agreement of the Parties and shall not be changed, modified,
      or terminated, except in writing signed by the Parties.

     

    20. Construction.  This
      Agreement shall be construed in accordance with the laws of the State of
      Texas.

     

    21. Assignment.  The
      rights and obligations of the Company under this Agreement shall inure to the
      benefit of and shall be binding upon the successors and assigns of the
      Company.  The Employee’s rights, powers, privileges and immunities
      under this Agreement shall not be assignable by the Employee without the prior
      written consent of the Company.

     

    22. Binding
      Effect.  This Agreement shall be binding upon and shall inure
      to the benefit of the Parties and their respective heirs, legal representatives,
      successors and assigns.

     

    23. Arbitration.  Any
      dispute or controversy arising from or relating to this Agreement shall be
      decided by arbitration in the State of Texas by the American Arbitration
      Association, by a panel of three arbitrators mutually acceptable to the Parties
      and in accordance with the procedural rules and regulations of that association.
      At the request of either the Company or the Employee, arbitration proceedings
      will be conducted in secrecy; in such case, all documents, testimony, and
      records shall be received, heard and maintained by the arbitrators in secrecy,
      available for inspection only by the Company, the Employee and their respective
      attorneys and experts who shall agree, in advance and in writing, to receive
      all
      such information confidentially and to maintain such information in secrecy
      until such information becomes generally known or until such times as such
      information becomes known by reason of judicial appeal from or enforcement
      of
      the decision of the arbitration.

     

    


    This
      Agreement is entered into as of December 10, 2007.

    


    COMPANY:

     

    PET
      ECOLOGY BRANDS, INC.

     

    


    By:                                  
      

    Ralph
      J.
      Steckel

    President

    


    


    EMPLOYEE:

     

                                  
      

    Robert
      J.
      Salluzzo 

     

     

    This
      agreement is hereby ratified by a majority of the
      Pet Ecology Brands, Inc. Board of Directors on this ___day of December 2007.
      

     

     

                                  
      

    
      Wes
        Kirby


      Secretary

    

     

     

    7