EXHIBIT 10.16
EMPLOYMENT AGREEMENT
        THISAGREEMENT is made as of July 1, 2003, between MEDIA SCIENCES INTERNATIONAL,INC., a Delaware corporation with offices at 40 Boroline Road, Allendale, NewJersey 07401 (“Employer”), and MICHAEL W. LEVIN (“Employee”)residing at 8 Meadow Lane, Allendale, New Jersey 07401. 

                                                W I T N E S S E T H:
        WHEREAS,Employer desires to retain the services of Employee and Employee desires to beemployed by Employer upon the terms and conditions hereinafter set forth; 

        NOWTHEREFORE, in consideration of the agreements herein contained, the partieshereto agree as follows: 

        I.             EMPLOYMENT.  Employer hereby employs Employee, and Employee hereby agrees to serve, asPresident and Chief Executive Officer of Employer, for the Term of Employment (as defined in Section 2).Employee agrees to perform such services as are customary for such offices.  Employee further agrees to useEmployee's best efforts to promote the interest of Employer and to devote Employee's full business time andenergies during normal business hours to the business and affairs of Employer during the Term of Employment.

                 2.             TERM OF EMPLOYMENT.  The employment hereunder which commences on July 1, 2003 and shallcontinue for a term of five (5) years (the "Term of Employment"), unless earlier terminated:  (a) upon death ofEmployee; (b) at the option of Employer upon 30 days' prior written notice to Employee, in the event Employee, byreason of physical injury or illness, is unable to materially perform his duties hereunder for a continuousperiod of 120 days and has no expectation of returning to work within a reasonable time thereafter; or (c) uponthe discharge of Employee by the Board of Directors of Employer for "cause" (as defined in Section 10 hereof).

                 3.             COMPENSATION.

                                A.             Base Salary.  As compensation for the services to be provided hereunder and inconsideration of Employee's agreement not to compete as set forth in Section 4, during the Term of Employment,Employer shall pay Employee an annual salary of two hundred thousand dollars ($200,000), or such greater annualsalary as may be established by Employer's Board of Directors, which shall be payable in appropriate installmentsto conform with the regular payroll dates for salaried personnel of Employer.

                                B.             Incentive Earnings Bonus.  In addition to any bonus to be determined by the Board ofDirectors, Employee is eligible for certain incentive bonuses.  Employee is hereby granted five year options topurchase 500,000 shares of the Company's common stock, par value $.001 per share.  Options to purchase 250,000shares at $1.00 per share, shall vest immediately and Options to purchase an additional 250,000 shares at $1.00per share shall vest ratably over the period July 1, 2003 through June 30, 2005  These options are cumulative andare subject to anti-dilution rights.

                                C.             Bonus.  Employee shall, during the term of this Agreement, be entitled to an annualperformance bonus equal to such amount as the Board of Directors may determine.  Additionally, Employee shall beentitled to such other bonuses as the Board of Directors shall determine from time to time.

                               D.             Other Benefits.  Employee shall be entitled to the following fringe benefits,perquisites, and other benefits of employment during the Term of Employment:  (i) medical and dental insuranceunder such group medical, dental and vision insurance policies as Employer may provide to its employees;(ii) sick days in accordance with Employer's policy regarding officers; (iii) six (6) weeks vacation in each yearprorata; (iv) participation in Employer's 401(k) plan or such other plan as Employer may adopt; (v) participationin Employer's employee stock option plan, and/or such independent plan as may be established; and (vi) Employershall also during the term hereof, and for one year thereafter provide and fully pay for a fifteen year (15-year)term life insurance policy on the life of Employee, subject to Employee's reasonable insurability, with a faceamount of benefit of $2,000,000 and with the beneficiary thereof to be Employee's estate, or as otherwisedirected by Employee.  Employee shall have the option to maintain such insurance at his own expense commencingone year after the end of the term hereof, if such term is not renewed.  In addition to the foregoing, Employeeshall also be entitled to any benefits, perquisites and other benefits, to the extent that the Board of Directorsdetermines such benefits are to be made available to Employer's employees or management employees in general.

                                E.             Payment Upon Early Termination.  In the event of early termination of employment forany reason specified in Section 10 hereof, Employer shall no longer be obligated to make any payments ofcompensation to Employee or Employee's estate under this Agreement except as provided for herein.  However, anysalary or bonus earned and/or vested for prior periods, but not yet paid, shall be paid by Employer to Employeeor Employee's estate.

                 4.             COVENANT NOT TO COMPETE; INTELLECTUAL PROPERTY;                  CONFIDENTIALITY.

                                A.             Covenant Not to Compete and Solicit.  During the Term of Employment, Employee willnot, within any jurisdiction in which Employer or any affiliate conducts its business operations, or in any waymaterially competing with Employer, directly or indirectly, own, manage, operate, control, be employed by orparticipate in the ownership, management, operation or control of, or be connected in any manner with, anybusiness of the type or character engaged in or competitive with that conducted by Employer.  The decision ofEmployer's Board of Directors as to what constitutes a competing business shall be final and binding uponEmployee, and such decision shall be made in good faith.  For these purposes, ownership by Employee or anyaffiliate of Employee of securities of a public company not in excess of 1% of any class of such securities shallnot be considered to be competition with Employer.

                                                     For a period of three (3) years after termination of Employee's employment withEmployer,  Employee further agrees to refrain from interfering with the employment relationship between Employerand its other employees by soliciting any of such individuals to participate in independent business ventures andagrees to refrain from soliciting business from any client or prospective client (as disclosed in a list to beprovided to Employee by Employer at the time he ceases to be employed, which list shall be binding upon Employee)of Employer's for Employee's benefit or for any other entity.

                                                     It is the desire and intent of the parties that if any provisions of this Section 4(A)shall be adjudicated to be invalid or unenforceable, this Section 4(A) shall be deemed amended to deletetherefrom such provisions or portion adjudicated to be invalid or unenforceable, such amendment to apply onlywith respect to the operation of this paragraph in the particular jurisdiction in which  such adjudication ismade.

                                B.             Intellectual Property.  During the Term of Employment, Employee will disclose toEmployer all ideas, inventions and business plans developed by Employee during such period which relates directlyor indirectly to the business of Employer or affiliates, including without limitation any process, operation,product or improvement which may be patentable or copyrightable.  Employee agrees that such will be the propertyof Employer and that Employee will, at Employer's request and cost, do whatever is necessary to secure the rightsthereto by patent, copyright or otherwise to Employer.

                                C.             Confidentiality.  Employee agrees to not divulge to anyone (other than Employer or anyother persons employed or designated by Employer) any knowledge or information of any type whatsoever of aconfidential nature relating to the business of Employer or any of its subsidiaries or affiliates, includingwithout limitation all types of trade secrets (unless readily ascertainable from public or published informationor trade sources).  Employee further agrees not to disclose, publish or make use of any such knowledge orinformation of a confidential nature without prior written consent of Employer.

                 5.             CHANGE OF CONTROL.  Employee shall have the right to terminate the employment agreement in theevent of a "change in control" of Employer.  "Change of control" is defined to be any of the following:  (i) achange in the ownership or management of Employer that would be required to be reported in response to certainprovisions of the Securities Exchange Act of 1934; (ii) an acquisition (other than directly from Employer) by aperson or entity (excluding Employer) of 25% or more of the Employer's common stock or the Employer's thenoutstanding voting securities; (iii) a change in a majority of the current Board of Directors (the "IncumbentBoard") (excluding any persons approved by a vote of at least a majority of the Incumbent Board other than inconnection with an actual or threatened proxy contest); (iv) consummation of a reorganization, merger,consolidation or sale of all or substantially all of the Company's assets (collectively, a "Transaction") otherthan a Transaction in which all or substantially all of the shareholders of Employer prior to such transactionown, in the same proportion, more than 50% of the voting power of the entity resulting from the Transaction, atleast a majority of the board of directors of the resulting entity were members of the Incumbent Board, and afterwhich no person (other than the resulting entity and certain affiliates) beneficially owns 25% or more of thevoting power of the resulting entity, except to the extent such ownership existed prior to the Transaction; or(v) the approval by the Employer's stockholders of a complete liquidation or dissolution of Employer.  Upon achange in control, Employee shall be entitled to a lump sum payment, payable within one month of termination,equal to two hundred and ninety percent (290%) of Employee's "base amount", as defined inss. 280G(3) of the Code.

                 6.             REIMBURSEMENT OF EXPENSES.  Employee shall be entitled to be reimbursed for reasonable traveland other expenses incurred in connection with Employee's services to Employer pursuant to and during the Term ofEmployment upon a basis consistent with the policies established or announced by Employer.

                 7.             AUTOMOBILE.  Employer presently provides Employee with an automobile, including relatedmaintenance, repairs, insurance, and other costs, for the exclusive use of Employee, under a lease, cosigned byEmployee, due to expire in November 2005.  Employer agrees to continue said lease, make all necessary paymentsand related expenses to said automobile, and prior to the expiration of the lease, Employer shall exercise theoption to purchase said automobile and sell such automobile to Employee for the sum of $1,000.  In the event thatEmployee's employment with Employer shall be terminated for whatsoever reason, Employer shall immediatelyexercise the option to purchase such automobile and shall sell the automobile to Employee for the sum of $1,000.

                  Employer recognizesEmployee’s need for an automobile for business purposes. Therefore, uponthe expiration of the aforementioned automobile lease, Employer shall provideEmployee with an automobile, including related maintenance, repairs, insurance,and other costs. The automobile will be selected by Employee, and the automobileand related costs shall be comparable to those which Employer presently providesEmployee. 

                 8.             DEATH BENEFITS.  If Employee dies during the Term of Employment, Employer shall pay toEmployee's estate the compensation that would otherwise be payable to Employee for twelve months following themonth in which his death occurs.  In addition, Employer shall pay $100,000, in a lump sum, to the Employee'swidow, or, if he is not then survived by his widow, to the Employee's surviving children in equal shares, or, ifthere are no surviving children, to the Employee's estate.

                 9.             BREACH BY EMPLOYEE.  Both parties recognize that the services to be rendered under thisAgreement by Employee are special, unique and extraordinary in character, and that in the event of a breach byEmployee of the terms and conditions of this Agreement to be performed by Employee, or in the event Employeeperforms services during the Term of Employment for any person, firm, corporation or other entity engaged in acompeting line of business with Employer, or otherwise breaches this Agreement, Employer shall be entitled, if itso elects, to institute proceedings and to prosecute them in any court of competent jurisdiction, either in lawor in equity, to obtain damages for any breach of this Agreement, or to enforce the specific performance thereofby Employee, or to enjoin Employee from performing services for any such other person, firm, corporation or otherentity.

                 10.            TERMINATION FOR CAUSE.  Employer may terminate Employee for cause upon thirty days' priorwritten notice to Employee.  For purposes of this Agreement, an event or occurrence constituting "cause" shallmean:

                                      A.  Employee's willful failure or refusal after notice thereof, to perform specific directivesof Employer's Board of Directors, when such directives are consistent with the scope and nature of Employee'sduties and responsibilities as set forth in Section 1 and elsewhere herein and such failure or refusal is:  (i)not corrected within a reasonable time after receipt of written notice sent by Employer's Board of Directorsafter resolution authorizing such notice; (ii) the direct material cause of material damages to the Employer; and(iii) within the ability and power of Employee to materially perform such directive as to render such failure orrefusal willful;

                                      B.  Employee's conviction of a felony or of any crime involving moral turpitude, fraud ormisrepresentation and final resolution of all appeals therefrom;

                                      C.  Any final court determination of gross or willful misconduct of Employee resulting insubstantial loss to Employer, substantial damage to Employer's reputation or any material theft from Employer;

                                      D.  Other than by reason of physical injury or illness, a final court determination ofEmployee's material failure to perform the duties and responsibilities under this Agreement causing materialdamage to Employer; or

                                      E.  Any final court determination of any material breach (not covered by any of the clauses (A)through (D)) of any of the provisions of this Agreement, causing material damage to Employer, and such breach wasnot cured within ten days after written notice thereof to Employee by Employer.

                 11.            FISCAL YEAR.  For purpose of this Agreement, the Company's fiscal year end is assumed to beJune 30.

                 12.            ASSIGNMENT.  This Agreement is a personal contract and, except as specifically set forthherein, the rights and interests of Employee herein may not be sold, transferred, assigned, pledged orhypothecated by Employee.  The rights and obligations of Employer hereunder shall be binding upon and run infavor of the successors and assigns of Employer.  In the event of any attempted assignment or transfer of rightshereunder contrary to the provisions hereof, Employer shall have no further liability for payments hereunder.Employee specifically consents to assignment of this Agreement by Employer pursuant to any reorganization orbusiness combination that Employer may effect hereafter.

                 13.            GOVERNING LAW; CAPTIONS.  This Agreement contains the entire agreement between the parties andshall be governed by the laws of the State of New Jersey.  It may not be changed orally, but only by agreement inwriting signed by the party against whom enforcement of any waiver, change, modification or discharge is sought,and consented to in writing by the Board of Directors of Employer.  Section headings are for convenience orreference only and shall not be considered a part of this Agreement.

                 14.            PRIOR AGREEMENTS.  This Agreement supersedes and terminates all prior agreements betweenEmployer and Employee relating to the subject matter herein addressed.

                 15.            NOTICES.  Any notice or other communication required or permitted hereunder shall besufficiently given if delivered in person to Employer by delivery to its Chairman of the Board of Directors orsent by telex, telecopy or by registered or certified mail, postage prepaid, addressed as follows:

                                          if to Employee, to:                                          Michael W. Levin                                          8 Meadow Lane                                          Allendale, New Jersey 07401                                          if to Employer, to:                                          Media Sciences International, Inc.                                          40 Boroline Road                                          Allendale, New Jersey 07401

        INWITNESS WHEREOF, Employer has by its appropriate officer signed this Agreementand Employee has signed this Agreement, on and as of the date and year firstabove written. 
MEDIA SCIENCES INTERNATIONAL, INC.                                           By:                                                       Paul Baker        DirectorEMPLOYEE                                           By:                                                       Michael W. Levin