Exhibit 10.1


EXECUTIVE
EMPLOYMENT AGREEMENT


THIS EXECUTIVE
EMPLOYMENT AGREEMENT (“Agreement”), dated as of April 6, 2007, is made by and
between MFIC CORPORATION, a Delaware corporation (the “Company”), and IRWIN J.
GRUVERMAN, an adult individual (the “Executive”).  The Company and the Executive are sometimes
referred to herein individually as a “Party” and collectively as the “Parties.”


WHEREAS, the
Executive has long served as the Company’s Chief Executive Officer and Chairman
of the Board, but is desirous of reducing his day-to-day obligations to the
Company and has tendered his resignation as Chairman of the Company’s Board of
Directors, Chief Executive Officer and other roles as referenced more fully
below, which resignation is hereby accepted; and


WHEREAS, the
Company is desirous of retaining the Executive as an employee with at least
limited availability to the Company on an as-needed basis during the near-term;
and


WHEREAS, the
Company would like the Executive to serve as the Company’s Chairman Emeritus,
and the Executive is willing to do so, on the terms and conditions set forth
herein.


NOW THEREFORE, in
consideration of the mutual covenants and agreements contained herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties do hereby agree as follows:


1.             Duties.  The Company shall employ the Executive as its
Chairman Emeritus and the Executive shall have the customary duties,
responsibilities and authority normally associated with such position,
including, without limitation, attendance at special and regular meetings of
the Company’s board of directors (the “Board”), and such additional duties as
the Board may, from time to time, assign to the Executive of the type normally
assigned to a Chairman Emeritus or non-independent Board member, provided,
however, that the Executive will not be required to devote more than ten (10)
hours per week to fulfilling such duties.


2.             Term.  The Company shall employ Executive as its
Chairman Emeritus until June 30, 2008 (the “Target Date”) or until such time as
a majority of the members of the Board holding office as of the date hereof no
longer hold such position, whichever is sooner.


3.             Salary and Benefits.  The Executive’s salary shall be $6,000.00 per
month paid in accordance with the Company’s usual payroll policies and
procedures.  The Executive intends to
provide his services from his home, except on such occasions as his presence in
the Company’s offices are necessary (e.g., to attend
Board or other meetings), and it is not intended that the Company will provide
the Executive with an office.  The
Company shall not provide the Executive with health insurance, life insurance
or other benefits; although the Company shall facilitate the Executive’s application
for health insurance coverage under the provisions of the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended (commonly referred to as COBRA).













 


4.             Additional Agreements.


a.             The Company agrees that it will
promptly respond to requests received from time to time from the Executive for
the issuance of legal opinions regarding the permissibility of sales of the
Executive’s shares of the Company’s stock under Rule 144.


b.             The Company will, concurrent with
the execution of this Agreement by the Executive, sell to the Executive the
laptop computer and related computer peripherals owned by the Company and
currently in the Executive’s possession for a sale price of $1.00, provided, however, that the Employee agrees to promptly
provide the Company with copies of all files on such computer equipment which
relate to the Company’s business and to immediately thereafter delete such
files from such computer equipment.


c.             The Company agrees to pay the
reasonable legal fees incurred by the Executive associated with the negotiation
of this Agreement, not to exceed $5,000.


d.             The Company has attached as
Exhibits to this Agreement drafts of the Form 8-K and press release announcing
the Executive’s resignation as the Company’s Chief Executive Officer and Chairman
of the Board and changed employment status and solicits his comments thereon.


e.             The Executive will have reasonable
access to his current office at the Company in order to remove his personal
effects.


f.              The Company agrees that Mr.
Gruverman has 324 hours of accrued but unused vacation through the date
hereof.  At his election, Mr. Gruverman
shall inform the Company whether (i) he intends to use such accrued but unused
vacation, (ii) he would like the Company to pay to him the cash value of such
accrued but unused vacation in accordance with the Company’s standard
procedures or (iii) he prefers to affect a combination of the foregoing; provided
however, that the total number of hours that Mr. Gruverman shall use or for
which he shall receive payment pursuant to this Section 4f shall not exceed 324
hours.


5.             Termination and Severance.


a.             In the event that on or before the
Target Date:  (i) the Executive shall
voluntarily terminate his employment with the Company, (ii) the Executive shall
die or become Permanently Disabled (as defined below), or (iii) the Company
shall terminate the Executive’s employment with the Company for Cause (as
defined below), the Company shall be under no obligation to provide the
Executive with further compensation or severance except for salary accrued
prior to such termination or as otherwise required by applicable law.


b.             In the event that:  (i) the Company shall terminate the Executive’s
employment with the Company on or before the Target Date without Cause, or (ii)
a majority of the current Board of Directors of the Company shall have resigned
or otherwise have been replaced, the Executive shall be entitled to receive an
amount equal to the value of his salary from the date of the foregoing event
through and including the Target Date (the “Severance Payment”).  The Severance Payment will be payable to the
Executive in a single payment within twenty (20) days of the occurrence of
either of the foregoing events.



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6.             Definitions.


a.             “Cause” shall mean (i) the willful
failure or refusal by the Executive to perform his duties hereunder (other than
any such failure resulting from the Executive becoming Permanently Disabled);
(ii) the Executive’s willful material breach of this Agreement or any material
policy of the Company or its subsidiaries applicable to him that has been
disclosed to him which, if capable of cure, has not been cured within ten (10)
business days after written notice of such breach delivered to the Executive by
the Company; (iii) the Executive’s willful misconduct, or conduct reasonably
deemed by the Board to be grossly negligent, with respect to the performance of
his duties that is materially injurious to the Company, its subsidiaries,
stockholders, employees or customers, monetarily or otherwise, which, if capable
of cure, has not been cured within ten (10) business days following written
notice of such violation delivered to the Executive by the Company; or (iv) the
conviction of the Executive, or plea of guilty or nolo
contendere, with respect to (A) any felony, (B) any act of fraud,
theft, or financial dishonesty with respect to the Company or any of its
subsidiaries or their respective stockholders, or (C) any other crime involving
dishonesty, disloyalty or fraud with respect to not less than $5,000.  Notwithstanding the foregoing, the Executive’s
Employment hereunder shall not be deemed to be terminated for Cause except by
action of the Board, acting in good faith.


b.             “Permanently Disabled” shall mean
the expiration of a continuous period of 120 days during which the Executive is
unable to perform his assigned duties due to physical or mental incapacity, as
reasonably determined by the Board in good faith after consulting with such
medical advisers as the Board shall see fit.


7.             Survival.  The obligation of the Company to make the
Severance Payment shall survive the termination of this Agreement, the
termination of the Executive’s employment with the Company, a change of control
of the Company, the sale or other disposition of substantially all of the
assets of the Company (including a statutory merger where the Company is not
the surviving party) and the passage of the Target Date on the terms stated
herein.


8.             Severability.  Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.


9.             Complete Agreement.  This Agreement embodies the complete
agreement and understanding among the Parties and supersedes and preempts any
prior understandings, agreements or representations by or between the Parties,
written or oral, which may have related to the subject matter hereof.


10.           Counterparts.  This Agreement may be executed in separate
counterparts, including via facsimile, each of which is deemed to be an
original and all of which taken together constitute one and the same agreement.



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11.           Successors and Assigns.  This Agreement is intended to bind and inure
to the benefit of and be enforceable by the Executive, the Company and their
respective heirs, successors and assigns, except that the Executive may not
assign his rights or delegate his obligations hereunder without the prior
written consent of the Company.


12.           Choice of Law.  This Agreement will be governed by the
internal law, and not the laws of conflicts that would give effect to the laws
of another jurisdiction, of the Commonwealth of Massachusetts.


13.           Amendment and Waiver.  The provisions of this Agreement may be
amended or waived only with the prior written consent of the Company and the
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement shall affect the validity, binding effect or
enforceability of this Agreement.


14.           Resignations.  With the exception of his role as a Director
of the Company and his new position as Chairman Emeritus, the Executive hereby
tenders his resignation with respect to all of his other officer, director and
fiduciary positions with the Company, its affiliates and subsidiaries, and all
related positions, including without limitation:  (a) his position as Chief Executive Officer,
Secretary and Treasurer of the Company; (b) his position as Chairman of the
Board of Directors and as a Director of the Company’s subsidiary, Microfluidics
Corporation; (c) all of his officer positions with Microfluidics Corporation;
(d) his administrative, fiduciary or other positions with the Company,
including without limitation, his position as Plan Administrator for the
Company’s 401(k) Plan, as administrator of the 1988 Stock Plan, as amended,
1989 Non-Employee Directors Stock Plan, 2006 Stock Plan, and Employee Stock
Option Plan, etc.  Notwithstanding the foregoing,
and without receiving additional consideration therefor, the Executive agrees
to execute any and all such filings and certifications to be filed by the
Company with the Securities and Exchange Commission, the Company’s auditors and
with other regulatory authorities with regard to all fiscal periods during
which the Executive served in his various capacities as aforesaid.


IN WITNESS
WHEREOF, the undersigned have caused this Agreement to be executed as of the
date first above written.


	
  COMPANY:

  	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  
	
  MFIC CORPORATION

  	
   

  	
   

  
	
  a Delaware
  corporation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Robert P.
  Bruno

  	
   

  	
  /s/ Irwin J. Gruverman

  
	
   

  	
   

  	
   

  
	
  Name: Robert P.
  Bruno

  	
   

  	
  Irwin J. Gruverman

  
	
   

  	
   

  	
   

  
	
  Title: President
  & COO

  	
   

  	
   

  
				



 



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