Exhibit 10.5


 


EMPLOYMENT AGREEMENT


 


EMPLOYMENT AGREEMENT
effective as of April 1, 2004 (the “Commencement Date”) by and between SCL
Ventures, Ltd. (the “Company”) and Mitchell J. Sepaniak (the “Executive”) (this
“Agreement”).


 


The parties hereto wish
to enter into an employment agreement on the terms and conditions set forth
below.  Accordingly, in consideration of
the premises and the respective covenants and agreements of the parties herein
contained, and intending to be legally bound hereby, the parties hereto agree
as follows:


 


1.                                       Term. 
The Executive’s employment under this Agreement shall commence on the
Commencement Date and shall end, unless terminated earlier pursuant to
Section 4, at the close of business on March 30, 2005 (the “Term”).


 


2.                                       Title, Duties and Authority.  The Executive shall serve as President and
Chief Executive Officer of the Company, and shall have such responsibilities
and duties (consistent with the Executive’s position as President and Chief
Executive Officer of the Company) as may from time to time be assigned to the
Executive by the board of directors of the Company (the “Board”), and shall
have all of the powers and duties usually incident to such offices.  In addition, throughout the Term, the
Executive shall serve as a member of the Board.  The Executive shall devote substantially all of his working time
and efforts to the business and affairs of the Company, except for vacations,
illness and incapacity; provided, however, that the Executive may serve on the
boards of directors of non-public companies and charitable organizations and
may devote reasonable time to charitable and civic organizations, in all cases
provided that the performance of his duties and responsibilities on such boards
and in such service does not interfere substantially with the performance of
his duties and responsibilities under this Agreement.


 


3.                                       Compensation and Benefits.


 


(a)                                  Base Salary.  During the Term, but solely after the date as of which the
Company has raised, during the period commencing on the Commencement Date, the
sum of Ten Million Dollars ($10,000,000), the Company shall pay the Executive a
base salary (“Base Salary) at the rate of One Hundred Fifty Thousand Dollars
($150,000) per annum, payable in accordance with the Company’s regular payroll
practices.


 


(b)                                 Employee Health and Dental Benefits.  The Executive shall be entitled to
participate in the Company’s employee health and dental benefits plan during
the Term, as such plan may be in effect from time to time.


 


(c)                                  Expenses.  The Executive shall be entitled to receive prompt reimbursement
of his expenses incurred in the performance of his employment hereunder upon
his submission to the Company of reasonable and customary expense claims to the
Company, in accordance with the Company’s procedures for expense reimbursement.


 

















 


(d)                                 Vacations.  The Executive shall be entitled to two (2) weeks paid vacation
during the Term with no right to carry over unused days.


 


(e)                                  Sick Pay.  The Executive shall be entitled to five (5) paid sick days during
the Term, with no right to carry over unused days.


 


4.                                       Termination.  The Executive’s employment hereunder with the Company may be
terminated under the following circumstances:


 


(a)                                  Death or Disability.  If the Executive shall die or become
disabled during the Term, the Company may terminate the Executive’s employment
hereunder for death or “Disability,” as applicable.  For purposes of this Agreement, the Executive’s “Disability”
shall be determined in the sole discretion of the Board.


 


(b)                                 Cause. 
The Company may terminate the Executive’s employment hereunder for
Cause.  For purposes of this Agreement,
the Company shall have “Cause” to terminate the Executive’s employment
hereunder upon:


 


(i)                                     the failure by the Executive to
substantially perform the Executive’s duties hereunder (other than any such
failure resulting from the Executive’s Disability which shall be subject to the
provisions of Section 4(a));


 


(ii)                                  the willful violation by the Executive of
any of the Executive’s material obligations hereunder;


 


(iii)                               the willful engaging by the Executive in
misconduct which is materially injurious to the business or reputation of the
Company or any of its affiliates; or


 


(iv)                              the Executive’s conviction of a felony.


 


Notwithstanding the
foregoing, the Executive shall not be terminated for Cause without:


 


(A)                              delivery of a written notice to the
Executive setting forth the reasons for the Company’s intention to terminate
the Executive’s employment hereunder for Cause;


 


(B)                                the failure of the Executive to cure the
nonperformance, violation or misconduct described in the notice referred to in
clause (A) of this paragraph, if cure thereof is possible, to the reasonable
satisfaction of the Board, within fifteen (15) days of the Executive’s receipt
of such notice; and


 


(C)                                an opportunity for the Executive,
together with the Executive’s counsel, to be heard before the Board.


 


(c)                                  Without Cause.  The Company may terminate the Executive’s employment hereunder
without Cause.


 


(d)                                 Resignation.  The Executive may terminate the Executive’s employment hereunder
by his resignation.


 

















 


5.                                       Compensation upon Termination.


 


(a)                                  Death or Disability.  If the Executive’s employment with the
Company hereunder is terminated on account of the Executive’s death or
Disability pursuant to Section 4(a), the Company shall as soon as
practicable pay to the Executive or the Executive’s estate, as applicable, or
as may be directed by the legal representatives of the Executive or the
Executive’s estate, as applicable, any Base Salary accrued and due to the
Executive under Section 3(a) through the date of the Executive’s death or
termination for Disability, as applicable. 
Other than the foregoing, the Company shall have no further obligations
to the Executive hereunder.


 


(b)                                 By the Company for Cause or By the
Executive.  If the Executive’s
employment with the Company hereunder is terminated by the Company for Cause
pursuant to Section 4(b) or by the Executive pursuant to
Section 4(d), the Company shall as soon as practicable pay the Executive
any Base Salary accrued and due to the Executive under Section 3(a)
through the Executive’s date of termination. 
Other than the foregoing, the Company shall have no further obligations
to the Executive hereunder.


 


(c)                                  Termination By the Company Without
Cause.  If the Company shall terminate
the Executive’s employment hereunder without Cause pursuant to
Section 4(c), then the Company shall:


 


(i)                                     as soon as practicable pay the Executive
any Base Salary accrued and due to the Executive under Section 3(a)
through his date of termination;


 


(ii)                                  continue to pay the Executive his Base
Salary in effect as of his date of termination for the lesser of the then
remainder of the Term or one (1) year (or until such earlier time that the
Executive violates the provisions of Section 6(a)), at the times such
payments would otherwise have been made under Section 3(a); and


 


(iii)                               provide the Executive for the lesser of
the then remainder of the Term or one (1) year (or until such earlier time that
the Executive violates the provisions of Section 6(a)), with continued
participation in the Company’s employee health and dental benefit plan, to the
extent that such a plan shall then continue to be in effect.


 


Other than the foregoing,
the Company shall have no further obligations to the Executive hereunder.


 


6.                                       Restrictive Covenant.


 


(a)                                  Reasonable Covenant.  It is expressly understood by and between
the Company and the Executive that the covenant contained in Section 6(b)
is an essential element of this Agreement and that but for the agreement by the
Executive to comply with such covenant and thereby not to diminish the value of
the organization and goodwill of the Company or any affiliate or subsidiary of
the Company, including relations with their employees, clients, customers and
accounts, the Company would not enter into this Agreement.  The Executive has independently consulted
with his legal counsel and after such consultation agrees that such covenant is
reasonable and proper.


 


(b)                                 Nondisclosure of Confidential
Information.  The Executive shall keep
secret and confidential and shall not disclose to any third party in any
fashion or for any purpose


 

















 


whatsoever, any
information regarding this Agreement, or any other information regarding the
Company or its affiliates or subsidiaries which is not available to the general
public, and/or  not generally known
outside the Company or any such affiliate or subsidiary, to which he has or
shall have had access at any time during the course of his employment with the
Company, including, without limitation, any information relating to the
Company’s (and its affiliates’ or subsidiaries’):


 


(i)                                     business, operations, plans, strategies,
prospects or objectives;


 


(ii)                                  products, technologies, processes,
specifications, research and development operations and plans;


 


(iii)                               customers and customer lists;


 


(iv)                              distribution, sales, service, support and
marketing practices and operations;


 


(v)                                 financial condition and results of
operations;


 


(vi)                              operational strengths and weaknesses; and


 


(vii)                           personnel and compensation policies and
procedures.


 


Notwithstanding the
foregoing provisions of this Section 6, the Executive may discuss this
Agreement with the members of his immediate family and with his personal legal
and tax advisors and may disclose the existence of his employment with the
Company to any third party.


 


(c)                                  Specific Performance.  Without intending to limit the remedies
available to the Company or its affiliates or subsidiaries, the Executive
hereby agrees that damages at law would be an insufficient remedy to the
Company or its affiliates or subsidiaries in the event that the Executive
violates any of the provisions of this Section 6, and that, in addition to
money damages, the Company or its affiliates or subsidiaries may apply for and,
upon the requisite showing, have injunctive relief in any court of competent
jurisdiction to restrain the breach or threatened breach of or otherwise to
specifically enforce the covenant contained in Section 6 (b).


 


7.                                       Successors.  This Agreement cannot be assigned by any of the parties hereto
without the prior written consent of the other party hereto, except that it
shall be binding automatically on any successors and assigns of all or
substantially all of the business and/or assets of the Company (whether direct
or indirect, by purchase, merger, consolidation or otherwise).


 


8.                                       Arbitration.  Except as provided in Section 6(c), all controversies,
claims or disputes arising out of or relating to this Agreement shall be
settled by binding arbitration under the rules of the American Arbitration
Association, as the sole and exclusive remedy of either party, and judgment
upon such award rendered by the arbitrators(s) may be entered in any court of
competent jurisdiction.  The costs of
arbitration shall be borne by the unsuccessful party or otherwise as determined
by the arbitrators in their discretion.


 

















 


9.                                       Governing Law.  The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of Delaware without
regard to conflicts of law principles.


 


10.                                 Amendments.  No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing signed by the Executive and such officers of the Company as may be specifically
designated for such purpose by the Board.


 


11.                                 Entire Agreement.  This Agreement sets forth the entire
agreement of the parties hereto in respect of the subject matter contained
herein and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto.


 


12.                                 Survival.  The obligations of the parties hereto contained in Sections 5, 6
and 8 shall survive the termination of this Agreement.


 


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


 


	
   

  	
  SCL VENTURES, LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Mitchell Sepaniak

  	
   

  
	
   

  	
  Name:

  	
    Mitchell
  Sepaniak

  
	
   

  	
  Title:

  	
    Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/  Mitchell Sepaniak

  	
   

  
	
   

  	
  MITCHELL J. SEPANIAK