THE TERMINATION DATE.
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3.6.
BUSINESS EXPENSES.
DURING THE EMPLOYMENT PERIOD, THE COMPANY
SHALL PROMPTLY REIMBURSE THE EMPLOYEE FOR ALL APPROPRIATELY DOCUMENTED,
REASONABLE OUT-OF-POCKET BUSINESS EXPENSES INCURRED BY THE EMPLOYEE IN THE
PERFORMANCE OF HIS DUTIES UNDER THIS AGREEMENT IN ACCORDANCE WITH COMPANY
POLICIES.
WITHOUT LIMITING THE FOREGOING, THE COMPANY SHALL REIMBURSE THE
EMPLOYEE FOR ALL COSTS OF MEMBERSHIP IN NEW YORK CITY'S CORE CLUB, INCLUDING,
WITHOUT LIMITATION, THE INITIATION FEE AND THE ANNUAL FEES.
3.7.
AUTOMOBILE ALLOWANCE.
DURING THE EMPLOYMENT PERIOD, THE
EMPLOYEE SHALL, UPON PRESENTATION OF SUPPORTING DOCUMENTATION, RECEIVE ONE
THOUSAND FIVE HUNDRED DOLLARS ($1,500) PER MONTH AS AN AUTOMOBILE ALLOWANCE FROM
WHICH THE EMPLOYEE SHALL PAY FOR ALL COSTS AND EXPENSES ASSOCIATED WITH DRIVING
AN AUTOMOBILE, INCLUDING, BUT NOT LIMITED TO, THE LEASE OR PURCHASE BY THE
EMPLOYEE OF AN AUTOMOBILE, INSURANCE, REPAIRS, GAS, AND MAINTENANCE.
4.
EQUITY PARTICIPATION.
ON THE EFFECTIVE DATE, THE EMPLOYEE SHALL BE GRANTED
WARRANTS TO PURCHASE 2,000,000 SHARES OF THE COMPANY'S COMMON STOCK PURSUANT TO
AN WARRANT AGREEMENT SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT A
(COLLECTIVELY, THE "WARRANT AGREEMENT").
THE WARRANT AGREEMENT SHALL PROVIDE
THAT FIFTY PERCENT (50%) OF THE WARRANTS SHALL HAVE AN EXERCISE PRICE EQUAL TO
$0.40 PER SHARE AND THE OTHER FIFTY PERCENT (50%) OF THE WARRANTS SHALL HAVE AN
EXERCISE PRICE EQUAL TO $0.60 PER SHARE.
THE OPTIONS SHALL BE EXERCISABLE BY
THE EMPLOYEE AT ANY TIME PRIOR TO THE DATE THAT THE WARRANTS TERMINATE IN
ACCORDANCE WITH THE TERMS OF THE WARRANT AGREEMENT.
5.
TERMINATION OF EMPLOYMENT.
5.1.
TERMINATION WITHOUT CAUSE.
THE COMPANY MAY TERMINATE THE
EMPLOYEE'S EMPLOYMENT HEREUNDER WITHOUT CAUSE DURING THE EMPLOYMENT PERIOD IN
ACCORDANCE WITH SECTION 8.
5.2.
TERMINATION FOR CAUSE. THE COMPANY MAY TERMINATE THE EMPLOYEE'S
EMPLOYMENT HEREUNDER FOR CAUSE IN ACCORDANCE WITH SECTION 8. FOR PURPOSES OF
THIS AGREEMENT, THE COMPANY SHALL HAVE "CAUSE" TO TERMINATE THE EMPLOYEE'S
EMPLOYMENT HEREUNDER IF SUCH TERMINATION SHALL BE THE RESULT OF:
(I)
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT IN CONNECTION WITH
THE EMPLOYEE'S PERFORMANCE OF MATERIAL DUTIES HEREUNDER;
(II)
A DEFAULT IN THE PERFORMANCE OF HIS MATERIAL DUTIES HEREUNDER
THE WILLFUL FAILURE OR WILLFUL NONFEASANCE BY THE EMPLOYEE TO SUBSTANTIALLY
PERFORM HIS DUTIES HEREUNDER; PROVIDED THAT WITH RESPECT TO THIS CLAUSE (II),
THE COMPANY MUST FIRST NOTIFY THE EMPLOYEE, IN WRITING, STATING WITH REASONABLE
SPECIFICITY, THE GROUNDS FOR CAUSE AND, IF CURABLE, ALLOW THE EMPLOYEE FIFTEEN
(15) DAYS AFTER THE DATE OF THE COMPANY'S NOTICE TO FULLY CURE;
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(III)
WILLFUL CONDUCT IN BAD FAITH AGAINST THE BEST INTERESTS OF THE
COMPANY OR ANY OF ITS AFFILIATES, WHICH CONDUCT HAS A MATERIAL AND ADVERSE
IMPACT TO THE COMPANY OR ANY OF ITS AFFILIATES;
(IV)
A CONVICTION WITH RESPECT TO A CHARGE OF COMMISSION OF A FELONY
OR A CRIME OF MORAL TURPITUDE (BUT SPECIFICALLY EXCLUDING DUI OR DWI); OR
(V)
THE COMMISSION OF A MATERIAL ACT OF EMBEZZLEMENT OR CONVERSION
OF FUNDS OF THE COMPANY OR ITS AFFILIATES.
5.3.
GOOD REASON THE EMPLOYEE MAY VOLUNTARILY TERMINATE HIS
EMPLOYMENT HEREUNDER FOR ANY REASON,