EMPLOYMENTAGREEMENT

1. Term.  The term of this Agreement shall commence on the date hereof (the “Effective Date”) and shall end on the date which is the fifth anniversary of the Effective Date unless Executive’s employment is terminated earlier in accordance with this Agreement (the “Initial Term”); provided, however, that the term of this Agreement shall automatically be extended beyond the Initial Term for additional one year periods, effective upon the fifth anniversary of the Effective Date (the “Renewal Term”), unless either party notifies the other by a date which is ninety (90) days prior to the expiration of the Initial Term that such party desires not to extend the Initial Term beyond the fifth anniversary of the Effective Date.  This Agreement shall continue for successive one-year Renewal Terms unless and until either party gives ninety (90) days notice to the other of its desire not to extend further the term of this Agreement beyond the end of the then-current Renewal Term, or this Agreement is otherwise terminated pursuant to Section 5 hereof.  The term of this Agreement, whether during the Initial Term or any Renewal Term, shall be referred to as the “Term.”

2.1 Position.  Executive will be employed by Company to render services to Company in the position of Co-Executive Chairman and President, reporting to the Company’s Board of Directors.  In that capacity, Executive shall be responsible for Company’s long-term and short-term strategy, which includes, but is not limited to overseeing the Company’s operations, business activities, implementation of its budgets, and financing strategies.  Executive shall also perform such other duties as may be consistent with Executive’s position.  Executive shall, in all material respects, abide by all material and written Company rules, policies, and practices as adopted or modified, from time to time, in Company’s sole discretion; and Executive shall attempt to use his best efforts in the performance of his duties hereunder.  Executive's principal place of business in the performance of his duties and obligations under this Agreement shall be in the New York City metropolitan area.  Notwithstanding the preceding sentence, Executive will engage in such travel and spend such time in other places as may be necessary or appropriate in furtherance of his duties hereunder. Executive also agrees to serve such of Company’s subsidiaries and affiliated companies in that capacity as may be designated by the Company.

2.2 Other Activities. While employed by Company, Executive shall devote at least 65% of his work time to Company’s business utilizing his substantial attention, and skill to perform his assigned duties, services, and responsibilities hereunder, and shall act at all times in the performance hereunder in furtherance of Company’s business and interests.  Executive shall not, during the term of this Agreement engage, directly, in any other business activity which materially interferes with Executive’s duties and responsibilities hereunder or creates a conflict of interest with Company.  The foregoing limitations shall not prohibit Executive from engaging in any capacity in other non-competitive businesses.  Company acknowledges and agrees that Executive will from time-to-time serve as an executive of other companies, on the boards of corporations, advisory committees, trade organizations, philanthropic organizations or other entities, and such activities shall not be a breach hereunder.

2.3 No Conflict. Executive represents and warrants that Executive’s execution of this Agreement, Executive’s employment with Company, and the performance of Executive’s duties under this Agreement shall not violate any obligations Executive may have to any other employer, person, or entity, including but not limited to any obligations with respect to not disclosing any proprietary or confidential information of any other person or entity.

3.1 Base Salary.  In consideration of the services to be rendered under this Agreement, Company shall pay Executive an initial base salary of one hundred twenty five thousand dollars ($125,000) per annum. (“Base Salary”), exclusive of Business Expenses as defined in Article 3.7, and in accordance with Company’s standard payroll and expense reimbursement policies.  Upon the earlier to occur of (i) the first anniversary of this Agreement, or (ii) the date on which the Company publicly reports consolidated annual gross revenues of at least $10,000,000, the Base Salary shall be increased to $200,000.  Upon the earlier to occur of (i) the second anniversary of this Agreement, or (ii) the date on which the Company publicly reports consolidated annual gross revenues of at least $35,000,000, the Base Salary shall be increased to $250,000.  Upon the earlier to occur of (i) the third anniversary of this Agreement, or (ii) the date on which the Company publicly reports consolidated annual gross revenues of at least $100,000,000, the Base Salary shall be increased to $350,000.  In addition, the Executive’s Base Salary will be reviewed, from time to time, and may be adjusted (upward, but not downward) at the discretion of the Board, including as a result of performing services for Company’s subsidiaries and affiliated companies.

3.2 Bonus Payment. In addition to the Base Salary, Executive shall be paid an annual cash bonus in the discretion of the Board of Directors (the “Bonus”).  The Bonus shall be paid to Executive within 30 days after the end of each anniversary of this Agreement.  The amount of such Bonus shall be targeted at 150% to 250% of Base Salary, assuming Executive meets performance goals set by the Board of Directors.

The target Bonus after the third year of the Term shall be determined in good faith by the Board of Directors, but shall in no event be less than the target Bonus for the third year of the Term. In addition, the Executive’s target Bonus will be reviewed, from time to time, and may be adjusted (upward, but not downward) at the discretion of the Board, including as a result of performing services for Company’s subsidiaries and affiliated companies.

3.4 Stock Options.  Company shall grant Executive options to acquire 100,000 shares of Company’s common stock (the “Options”) as early as practicable after the date hereof. Company shall execute and deliver an award agreement (the “Award Agreement”) for the Options to Executive as soon as practicable thereafter.  The Award Agreement will reflect Company’s standard terms and conditions for Executive stock option grants and contain the following terms:

3.5 Other Benefits.  During the Term, subject to, and to the extent Executive is eligible under their respective terms, Executive shall be entitled to receive such other compensation and fringe benefits as are, or are from time to time hereafter, generally provided by Company to Company's employees of comparable status (other than those provided under or pursuant to separately negotiated individual employment agreements or arrangements and other than as would duplicate benefits otherwise provided to Executive) and provided by Company’s subsidiaries and affiliated companies to their employees of comparable status, under any pension or retirement plan, disability plan or insurance, group life insurance, medical insurance, travel accident insurance, or other similar plan or program of Company.  To facilitate the performance of Executive's responsibilities hereunder, during the employment Term, Employer shall lease or acquire for Executive's exclusive use, or promptly reimburse Executive for the cost of leasing or acquiring, an automobile at a rate not to exceed $1,200 per month.  Employer shall promptly reimburse Executive for all expenses, including without limitation, parking and commutation expenses, in connection with the performance of his duties under this Agreement, subject to such policies as may be in effect from time to time applicable to senior executive officers of Employer.

(a) Death.  The death of Executive shall immediately and automatically terminate Executive’s employment under this Agreement.  If Executive dies while employed by Company, any unvested equity compensation granted to Executive under any Plan (including the Options) shall immediately vest and any vested warrants may be exercised on or before the earlier of (i) the warrant’s expiration date or (ii) eighteen months after Executive’s death.  Any warrant that remains unexercised after this period shall be forfeited.  Upon Executive’s death, Executive’s legal representative shall receive:  (1) any compensation earned but not yet paid, including and without limitation, any bonus if declared or earned but not yet paid for a completed fiscal year, any amount of Base Salary earned but unpaid, any accrued vacation pay payable pursuant to Company’s policies, and any unreimbursed business expenses, which amounts shall be promptly paid in a lump sum, (2) the pro rata amount of any Bonus or Bonus Options earned, and (3) any other amounts or benefits owing to Executive under any then applicable employee benefit plans, long term incentive plans or equity plans and programs of Company which shall be paid or treated in accordance with the terms of such plans and programs (subsections (1), (2) and (3) shall be collectively referred to as, the “Accrued Amounts”).  Other than the benefits described above, no further compensation or benefits shall be due or owing upon Executive’s death.

(d) Without Cause. At any time after Executive’s commencement of employment, Company may, without Cause, terminate Executive’s employment, effective thirty (30) days after written notice is provided to Executive.  In the event Executive is terminated by Company without Cause, Executive shall receive from Company within ten (10) days after such termination, in a lump sum payment, an amount equal to the sum of the Base Salary, maximum Bonus and Options that would have been paid to Executive through the end of the then remaining Term if Executive had not been terminated or for twelve months, whichever is more.  Executive shall also receive the Accrued Amounts.  Additionally, if Executive is terminated by Company without Cause, any unvested equity compensation granted to Executive under any Plan (including the Options) shall immediately vest and any vested warrants may be exercised on or before the earlier of:  (i) the warrant’s expiration date or (ii) eighteen months after Executive’s termination. Any warrant that remains unexercised after this period shall be forfeited.

(e) Resignation for Good Reason. At any time after Executive’s commencement of employment, Executive may resign for Good Reason (as defined below) effective thirty (30) days after written notice is provided to Company.  Upon Executive’s termination of employment for Good Reason, Executive shall be entitled to all payments and benefits as if his employment was terminated by Company without Cause as provided in subsection (d) above.  For purposes of this Agreement, Good Reason means: (i) any adverse change in Executive’s position, title or reporting relationship or a material diminution of his then duties, responsibilities or authority or the assignment to Executive of duties or responsibilities that are inconsistent with Executive’s then position; (ii) the failure by Company to continue in effect any material compensation or benefit plan or arrangement in which Executive participates unless an equitable and substantially comparable arrangement (embodied in a substitute or alternative plan) has been made with respect to such plan or arrangement, or the failure by Company to continue Executive’s participation therein (or in such substitute or alternative plan or arrangement) on a basis not less favorable, both in terms of the amount of benefits provided and the level of participation relative to other participants, as existed at the time of Executive’s termination of employment; (iii) any breach of this Agreement (or any other written agreement entered into between Executive and Company) by Company; (iv) failure of any successor to Company (whether direct or indirect and whether by merger, acquisition, consolidation or otherwise) to assume in a writing delivered to Executive upon the assignee becoming such, the obligations of Company hereunder; (v) a change in Company’s principal place of business to a location not within the New York metropolitan area, (vi) any significant and prolonged increase in the travelling requirements applicable to the discharge of Executive’s responsibilities, (vii) Executive has been removed from the Board of Company, or (viii) the aggregate amount of compensation and other benefits to be received by Executive pursuant to Sections 3.1, 3.2, 3.3 and 3.5 hereof for any twelve full calendar months shall be less than 100% of the amount received by Executive during the comparable preceding period without agreement by Executive in writing.

6.1 Use and Return of Company Property.  Executive acknowledges Company’s proprietary rights and interests in its tangible and intangible property.  Accordingly, Executive agrees that upon termination of Executive’s employment with Company, for any reason, and at any time, Executive shall deliver to Company all Company property.  Notwithstanding the foregoing, Executive may retain his rolodex and similar address and telephone directories (whether in writing or electronic format).

6.2 Non-Solicitation. At all times while Executive is employed by Company and for a period of: (i) one (1) year after any termination of Executive’s employment for Cause or Executive’s termination of his employment without Good Reason; (ii) the lesser of one (1) year or the remainder of the Term after any termination of Executive’s employment by Company without Cause or Executive’s termination for Good Reason; and (iii) one (1) year following the non-renewal of this Agreement or any termination pursuant to Section 5, Executive shall not, directly,   (a) employ or attempt to employ or enter into any contractual arrangement with any employee of Company, or (b) call on or solicit any of the actual  customers or suppliers of Company on behalf of himself in connection with any business that directly and materially competes with the Business of Company.  For purposes of this Section 6.2, the term “Business” shall mean the business of the Company conducted at the time of the Executive’s termination of employment.

7.  Indemnification; Insurance. 7.1 Indemnification of Executive. Except as otherwise provided by applicable law, while Executive is employed by Company and thereafter while potential liability exists (but in no event less than five (5) years after termination), in the event Executive is made a party to any threatened, pending, or contemplated action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by Company against Executive), by reason of the fact that Executive is or was performing services under this Agreement, then Company shall indemnify Executive to the fullest extent permitted by applicable law against all expenses (including attorneys’ fees), judgments, fines, and amounts paid in settlement, as actually and reasonably incurred by Executive in connection therewith.  In the event that both Executive and Company are made a party to the same third party action, complaint, suit, or proceeding, Company will engage competent legal representation, and Executive will use the same representation, provided that if counsel selected by Company shall have a conflict of interest that prevents such counsel from representing Executive, then Company may engage separate counsel on Executive’s behalf, and subject to the provisions of this Section 7, Company will pay all attorneys’ fees of such separate counsel.

8. Assignment; Binding Effect.  Executive shall have no right to assign this Agreement to another party other than by will or by the laws of descent and distribution.  This Agreement may be assigned or transferred by Company only to an acquirer of all or substantially all of the assets of Company, provided such acquirer promptly assumes all of the obligations hereunder of Company in a writing delivered to Executive and otherwise complies with the provisions hereof with regard to such assumption.  Nothing in this Agreement shall prevent the consolidation, merger, or sale of Company or a sale of any or all or substantially all of its assets.  Subject to the foregoing restriction on assignment by Executive, this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective heirs, legal representatives, successors, and assigns.

9.1 Amendments; Waivers; Remedies. This Agreement may not be amended, and no provision of this Agreement may be waived, except by a writing signed by Executive and by a duly authorized representative of Company. Failure to exercise any right under this Agreement shall not constitute a waiver of such right.  Any waiver of any breach of this Agreement shall not operate as a waiver of any subsequent breaches.  All rights or remedies specified for a party herein shall be cumulative and in addition to all other rights and remedies of the party hereunder or under applicable law.

9.2 Notices.  Any notice under this Agreement must be in writing and addressed to Company or to Executive at the corresponding address below.  Notices under this Agreement shall be effective upon: (a) hand delivery, when personally delivered; (b) written verification of receipt, when delivered by overnight courier or certified or registered mail; or (c) acknowledgment of receipt of electronic transmission, when delivered via electronic mail or facsimile.  Executive shall be obligated to notify Company, in writing, of any change in Executive’s address.  Notice of change of address shall be effective only when done in accordance with this Section 9.2.

9.3 Severability. If any provision of this Agreement shall be held by a court of competent jurisdiction to be invalid, unenforceable, or void, such provision shall be enforced to the fullest extent permitted by law, and the remainder of this Agreement shall remain in full force and effect.  In the event that the time period or scope of any provision is declared by a court of competent jurisdiction to exceed the maximum time period or scope that such court deems enforceable, then such court shall reduce the time period or scope to the maximum time period or scope permitted by law.

9.4 Taxes.  All amounts paid under this Agreement (including, without limitation, Base Salary) shall be reduced by all applicable state and federal tax withholdings and any other withholdings required by any applicable jurisdiction.

9.5 Governing Law.  The validity, interpretation, enforceability and performance of this Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of laws principles that would cause the laws of another jurisdiction to apply.

9.6 Venue.  Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York, for the purposes of any suit, action, or other proceeding arising out of this Agreement or any transaction contemplated hereby.

9.7 Interpretation. This Agreement shall be construed as a whole, according to its fair meaning, and not in favor of or against any party.  Sections and section headings contained in this Agreement are for reference purposes only, and shall not affect, in any manner, the meaning or interpretation of this Agreement.  Whenever the context requires, references to the singular shall include the plural and the plural the singular.

9.8 Survival.  Sections 4, 6.1, 6.2 and any other provision in this Agreement that requires performance by Executive or Company following termination of Executive’s employment hereunder shall survive any termination of this Agreement.

9.9 Counterparts.  This Agreement may be executed in several counterparts (including by means of telecopied signature pages), each of which shall be deemed an original but all of which shall constitute one and the same instrument.

9.10 Authority.  Each party represents and warrants that such party has the right, power, and authority to enter into and execute this Agreement and to perform and discharge all of the obligations hereunder, and that this Agreement constitutes the valid and legally binding agreement and obligation of such party and is enforceable in accordance with its terms.

9.11 Additional Assurances. The provisions of this Agreement shall be self-operative and shall not require further agreement by the parties except as may be herein specifically provided to the contrary; provided, however, that at the request of Company, Executive shall execute such additional instruments and take such additional acts as Company may deem necessary to effectuate this Agreement.

9.12 Entire Agreement. This Agreement is the final, complete, and exclusive agreement of the parties with respect to the subject matter hereof and supersedes and merges all prior or contemporaneous representations, discussions, proposals, negotiations, conditions, communications, and agreements, whether written or oral, between the parties relating to the subject matter hereof and all past courses of dealing or industry custom.  No oral statements or prior written material not specifically incorporated herein shall be of any force and effect, and no changes in or additions to this Agreement shall be recognized unless incorporated herein by amendment, as provided herein (such amendment to become effective on the date stipulated therein).

9.13 Executive Acknowledgment. Executive acknowledges that, before signing this Agreement, Executive was advised of his right to consult with an attorney of his choice to review this Agreement and that Executive had sufficient opportunity to have an attorney review the provisions of this Agreement and negotiate its terms. Executive further acknowledges that Executive had a full and adequate opportunity to review this Agreement before signing it; that Executive carefully read and fully understood all the provisions of this Agreement before signing it, including the rights and obligations of the parties; and that Executive has entered into this Agreement knowingly and voluntarily.