EXHIBIT 10.1
EMPLOYMENT AGREEMENT
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This EMPLOYMENT AGREEMENT, dated as of April 2, 2007 by and
between
COACTIVE MARKETING GROUP, INC., a Delaware corporation with its
principal place
of business at 75 Ninth Avenue, New York, New York 10011
("Employer") and BRIAN
MURPHY, an individual residing at 225 Central Park West, Apt. 1420,
New York,
New York 10024 ("Employee").
W I T N E S S E T H :
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WHEREAS, Employer operates a sales promotion and marketing
services
business;
WHEREAS, Employee and Employer's wholly-owned subsidiary, U.S.
Concepts
LLC, a Delaware limited liability company ("USC"), are parties to
an Employment
Agreement, dated as of December 29, 1998 (as amended from time to
time, the
"Original Employment Agreement") pursuant to which USC currently
employs
Employee; and
WHEREAS, Employer desires to employ Employee, and Employee desires
to
be employed by Employer, on the terms and conditions set forth
below;
NOW, THEREFORE, in consideration of the foregoing and the
mutual
agreements and covenants hereinafter set forth, the parties hereto
agree as
follows:
1.
Employment. Employer hereby employs Employee and Employee
hereby accepts employment by Employer for the period and on the
terms and
conditions set forth in this Agreement.
2.
Position, Employment Duties and Responsibilities. Employee
shall be employed as Vice Chairman of Employer, subject to such
reasonable
duties and responsibilities granted, and restrictions imposed, by
Employer's
Chief Executive Officer, and subject to Employer's company policies
and
procedures. Throughout the term of this Agreement, Employee shall
devote his
entire working time, energy and skill and best efforts to the
performance of his
duties hereunder in a manner which will faithfully and diligently
seek to
further the business and interests of Employer and its
subsidiaries. Employee's
direct reporting responsibility is to Employer's President and
Chief Executive
Officer.
3.
Working Facilities. Employee will work out of Employer's
office located in New York, New York. Employee shall not be
required to relocate
his office from New York, New York.
4.
Compensation and Benefits.
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4.1 Salary.
For all of the services rendered by Employee
to Employer, Employer shall pay to Employee an annual base salary
of three
hundred sixty two thousand dollars ($362,000), payable in
reasonable periodic
installments in accordance with Employer's regular payroll
practices in effect
from time to time. Employee's salary may be increased (but not
decreased) from
time to time as the Board of Directors of Employer (the "Board")
may determine
in its sole discretion.
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4.2 Bonus.
Employer from time to time may pay Employee
such bonuses or other additional compensation as the Board may
determine in its
sole discretion, but Employee acknowledges that there is no
agreement regarding
any such additional payments. Employee may also be eligible to
receive bonuses
in accordance with the terms and provisions of a management bonus
plan that may
be established for senior executives of Employer.
4.3 Employee
Benefits. Employee shall be entitled to
participate in and be provided with health insurance, life
insurance and other
benefit plans and programs offered to and or made available to
Employer's
employees. In addition, Employee shall be entitled to paid holidays
in
accordance with Employer's regular policy and twenty days of
vacation in each
calendar year and reasonable absences for illness. Any vacation
time not taken
during any calendar year of employment shall not be carried into
any subsequent
calendar year, and Employer shall not be obligated to pay Employee
for any
vacation time available to but not used by Employee within the
prescribed
period.
4.4 Travel,
Entertainment and Other Business Expenses.
During the period of employment pursuant to this Agreement,
Employee will be
reimbursed promptly for reasonable expenses incurred for the
benefit of Employer
in accordance with the general policy of Employer. Those
reimbursable expenses
shall include properly documented, authorized or otherwise
reasonably required,
travel, entertainment and other business expenses incurred by
Employee, other
than those expenses related to or in connection with routine
commutation to and
from Employee's home, in accordance with Employer's general
policy.
4.5
Deductions. All references herein to compensation to
be paid to Employee are to the gross amounts thereof which are due
hereunder.
Employer shall have the right to deduct therefrom all taxes which
may be
required to be deducted or withheld under any provision of the law
(including,
without limitation, social security payments, income tax
withholding and any
other deduction required by law) now in effect or which may become
effective at
any time during the term of this Agreement.
5.
Term; Severance.
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5.1 Term. This
Agreement shall be for a term of three (3)
years, commencing on the date hereof and ending on April 2, 2010,
unless sooner
terminated as hereinafter provided. The term of this Agreement
shall
automatically continue after the initial three-year term unless and
until either
party terminates this Agreement by providing the other party with
no less than
ninety (90) days prior written notice of termination effective on
or after the
third anniversary of the date hereof.
5.2 Severance.
In the event (i) Employer terminates
Employee's employment under this Agreement for any reason other
than for "Cause"
under Section 7, or (ii) Employee terminates his employment under
this Agreement
for Good Reason (as defined below), Employee shall be entitled to
receive
aggregate severance payments ("Severance Payments"), equal to
Employee's then
monthly base salary under Section 4.1, multiplied by the "Service
Factor." The
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Service Factor shall be a whole number equal to the number of years
(not
including fractional years) that have elapsed from the date that
Employee
initially became an employee of Employer or one of its subsidiaries
(i.e.,
December 29, 1998), and the date Employee's employment is
terminated hereunder,
provided, however, that the Service Factor shall not be less than
six (6) or
greater than twelve (12). The Severance Payments shall be paid to
Employee in
equal monthly installments, each such installment equal to
Employee's then
monthly base salary under Section 4.1, provided Employee is then in
compliance
with his obligations under Section 6 of this Agreement.
Notwithstanding the
foregoing, any amount payable under this Section 5.2 shall be
reduced on a
dollar-for-dollar basis by the amount Employee earns for providing
personal
services during the period for which Severance Payments would
otherwise be due,
and Employee hereby agrees to mitigate the Severance Payments
payable hereunder
by using reasonable efforts to obtain other employment during such
period.
5.3 Good
Reason. For the purposes hereof, "Good Reason"
shall mean the occurrence of any of the following events without
Employee's
consent: (i) a reduction in Employee's base salary to an amount
below $362,000,
(ii) the termination or material reduction of any material employee
benefit or
perquisite enjoyed by the Employee (other than in connection with
the
termination or reduction of such benefit or perquisite to all
executives of
Employer or as may be required by law), (iii) Employer relocates
its offices
outside of the greater New York metropolitan area requiring
Employee to relocate
his primary residence in order to perform his duties and
responsibilities
described herein; or (iv) the failure of Employer to obtain the
assumption in
writing of its obligation to perform this Agreement by any
successor to all or
substantially all of the assets of Employer within thirty (30)
calendar days
after the closing of a merger, consolidation, sale or similar
transaction.
Notwithstanding the foregoing, following written notice from the
Employee of any
of the events described in (i) through (iii) above, Employer shall
have thirty
(30) calendar days in which to cure the alleged conduct. If
Employer fails to
cure, the Employee's termination shall become effective on the 31st
calendar day
following such written notice.
6.
Nondisclosure and Non-Compete.
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6.1
Definitions. The following words and expressions used
in this Agreement shall have the respective meanings hereby
assigned to them as
follows:
(a)
"Affiliate" shall mean any partnership,
firm, corporation, association, trust, unincorporated organization
or other
entity, that directly, or indirectly through one or more
intermediaries,
controls, is controlled by, or is under common control with,
Employer.
(b) "Business
Associate" shall mean and refer to
any individual, partnership, corporation, associations or other
business
enterprise in any form which has had in the past, have currently,
shall have or
be attempting to develop during the Restriction Period a business
relationship
with Employer or any of its Affiliates as a customer or
supplier.
(c) "Customer"
shall mean and refer to any past
or current customer of Employer or any of its Affiliates and shall
also include
those prospective customers who are actively being marketed by
Employer or any
of its Affiliates during the Term.
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(d)
"Competitor" shall mean and refer to any
individual, partnership, corporation, association or other business
enterprise
in any form, other than Employer and its Affiliates, which at any
time during
the Restriction Period, either directly or indirectly, (i) engages
in the
business of promotion marketing and sells to Customers in the
Restriction Area
or (ii) engages in any other business directly competitive with
Employer or any
of its Affiliates and sells to Customers in the Restriction
Area.
(e)
"Confidential Information" shall mean and
refer to all information of Employer and its Affiliates which is
not generally
known or available to the public or a Competitor (whether or not in
written or
tangible form), the knowledge of which could benefit a Competitor,
including
without limitation, all of the following types of information:
(i) identities
of, and information pertaining
to, Customers, Personnel and Business
Associates;
(ii)
research, projections, financial
information, cost and pricing information,
invoices and internal accounting statistics;
(iii)
product or service development plans and
marketing strategies;
(iv)
purchasing methods; and
(v) trade
secrets, or other knowledge or
processes of or developed by Employer or any
of its Affiliates.
(f)
"Confidential Materials" shall mean and
refer to any and all documents, materials, programs, recordings or
any other
tangible media (including, without limitation, copies or
reproductions of any of
the foregoing) in which Confidential Information may be
contained.
(g)
"Personnel" shall mean and refer to any and
all employees, contractors, ag
