EXHIBIT 10.28
October 22, 1999
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Dear ▇▇▇▇:
This letter is intended to set forth the terms and conditions under
which Entrade, Inc., is offering to employ you as its General Counsel, effective
as of November 8, 1999. Please be advised that the undersigned has full
authority to execute this agreement on behalf of and to bind Entrade, Inc.,
without any further action of the Board of Directors of Entrade, Inc.
Parties: Entrade, Inc. ("Entrade" or the "Company") and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ (identified herein as
"you").
Position: Your position will be General Counsel, reporting to
Entrade's President and its Board of Directors.
Compensation: Your base salary ("base salary") for the remainder of
1999 will be at a rate not less than $150,000 per
year, payable in accordance with Entrade's usual
payroll policies, and in no event will your base
salary be less than $150,000 per year during the term
of this agreement. You will be entitled to receive
such increases in your base salary as you and the
Entrade Board of Directors may agree.
Stock Options: You will be granted an option to acquire 100,000
shares of the Common Stock of Entrade (the "Option"),
at the closing price for such Common Stock on
November 8, 1999, or such other date as your
employment hereunder commences. The terms and
conditions of the Option shall be set forth in a
Stock Option Agreement to be executed by the parties
pursuant to Entrade's 1996 Stock Option Plan;
provided, however, that the failure of Entrade to
execute such a Stock Option Agreement shall not
relieve Entrade of its obligation to issue the Option
otherwise in accordance with the provisions of this
paragraph. The expiration date of the Option will be
ten years from the grant date. The options subject to
the Option shall vest as to 33,333 shares of Common
Stock on November 7, 2000, 33,333 shares of Common
Stock on November 7, 2001, and 33,334 shares of
Common Stock on November 7, 2002, and will thereafter
be fully exercisable as to all 100,000 shares of
Common Stock.
Lost Compensation Entrade acknowledges that, in accepting Entrade
Reimbursement: employment at this time, you will be forfeiting
substantial compensation to which you would otherwise
be entitled. To recompense you for such compensation,
Entrade shall pay you a bonus of $12,500 before the
end of 1999. The obligations of the Company under
this Paragraph are absolute and unconditional, will
survive your death or disability, and will survive
the termination of your employment with the Company
for any reason (whether such termination is during or
after the term of your employment).
Reimbursement of The Company will reimburse you for all business-
Business Expenses: related expenses that you incur in connection with
the performance of your responsibilities to Entrade.
Other Benefits: You will be eligible to participate in all Entrade
employee benefit plans including group health,
dental, pension, long-term disability, short-term
disability, 40l(k), and life insurance. If you elect
to retain group health coverage with your prior
employer under the provisions of COBRA, Entrade
agrees to pay any required COBRA payments on your
behalf. If such payments are treated as compensation
to you, you agree that you shall be responsible for
any taxes on such payments.
Bonuses: Unless your employment pursuant to this agreement is
earlier terminated by the Company for Cause or
terminated by you without Good Reason, Entrade shall
pay to you a bonus prior to the end of each calendar
year during the term of this agreement in an amount
determined in accordance with the performance and
other criteria set forth in the Bonus Plan to be
adopted by Entrade's Board of Directors; provided,
however, that your bonus for calendar year 2000 shall
in no event be less than $25,000.
Additional Options While you are in the employ of the Company, you will
and Bonuses: be granted such additional stock option awards and
such additional bonuses as determined from time to
time by the Company's Board of Directors.
Term: The initial term of your employment shall commence as
of November 8, 1999, and ending December 31, 2002
(the "Initial Term"). Commencing on January 1, 2003,
and on each anniversary thereafter the term of your
employment shall automatically be extended for one
additional year ("extended term") unless, not later
than ninety (90) days preceding such date, you or
Entrade shall give written notice to the other that
you or it does not wish to extend the term of
employment for such additional one year period.
Termination: If at any time during the Initial Term, Entrade
should terminate your employment for reasons other
than Cause (hereinafter defined) or if you terminate
your employment for Good Reason (hereinafter
defined), you or your estate will be entitled
post-termination to a continuation of your base
salary, as its then current rate, through and until
the later of (i) the end of the Initial Term, or (ii)
a period of six (6) months from the date of the
notice of termination (which date shall be deemed and
hereafter referred to as the "effective date of
termination").
If Entrade elects not to renew the term of your
employment for any additional one-year period for any
reason other than Cause, or if your employment shall
be terminated during any extended term either by
Entrade for any reason other than Cause or by you for
Good Reason, you shall be entitled to receive as
severance a lump sum amount equal to the sum of your
base salary for a period of six (6) months at the
effective date of termination.
Upon any termination described in this Section, you
will be entitled to continue to participate in all of
the employee benefit plans and programs in which you
were participating prior to the termination of your
employment until the later of (i) the end of the
Initial Term, or (ii) the date six (6) months after
the effective date of termination.
Change of Control: Notwithstanding the provisions of the "Termination"
section hereof, in the event of a "Change in Control"
(hereinafter defined), you shall be entitled to
receive a lump-sum payment equal to your base salary,
at its then current rate, for a period of twenty-four
(24) months. For purposes of this Agreement, a
"Change of Control" shall be deemed to have occurred
if (a) any "person" (as defined in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as
amended (the "1934 Act")), who is not a "beneficial
owner" (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of securities of Entrade
representing more than five percent (5%) of the
combined voting power of Entrade's currently
outstanding securities as of the date of this
Agreement becomes the beneficial owner, directly or
indirectly, of securities of Entrade representing
more than fifty percent (50%) of the combined voting
power of Entrade's then outstanding securities; or
(b) the Board of Directors or stockholders of Entrade
approve a merger or consolidation of Entrade with any
other entity, other than (i) a merger or
consolidation which would result in the voting
securities of Entrade outstanding immediately prior
thereto continuing to represent (either by remaining
outstanding or by being converted into voting
securities of the surviving entity) at least eighty
percent (80%) of the combined voting power of the
voting securities of Entrade or such surviving entity
outstanding immediately after such merger or
consolidation or (ii) a merger or consolidation
effected to implement a recapitalization of Entrade
(or a similar transaction in which no "person" who is
not a beneficial owner, directly or indirectly, of
securities of Entrade representing more than five
percent (5%) of the combined voting power of
Entrade's currently outstanding securities as of the
date of this Agreement acquires more than fifty
percent (50%) of the combined voting power of
Entrade's then outstanding securities); or (c) the
Board of Directors or stockholders of Entrade approve
a plan of complete liquidation of Entrade or Entrade
enters into an agreement for the sale or other
disposition of all or substantially all of Entrade's
assets or otherwise disposes of such assets.
Duties: As General Counsel, you shall perform such duties
that are consistent with your position as general
counsel of a publicly traded company as you shall be
directed to perform by the President or the Board of
Directors. In addition, you shall have the discretion
to perform such other duties that are required by the
laws of the jurisdictions in which Entrade operates
or by the contracts and agreements to which Entrade
is subject.
You acknowledge that your office will require your
full-time efforts and attention, and that you shall
not, during the Initial Term or any extension, engage
in any other business activity, whether or not such
other business activity is for your own behalf or for
any other person, firm, corporation or other entity
(together, a "Person") and whether or not such other
Person is in competition with Entrade.
Notwithstanding the foregoing, you shall be allowed
to manage and oversee passive investments in
noncompeting businesses, provided that such
management and oversight do not interfere with the
performance of your duties for Entrade.
Cause: Your employment may be terminated at any time for
Cause, which is hereby defined as (i) conduct, at any
time, which has involved criminal dishonesty,
conviction of any felony, or conviction of any lesser
crime or offense involving the property of Entrade,
or any of its subsidiaries or affiliates,
misappropriation of any money or other assets or
properties of Entrade, or that of its subsidiaries or
affiliates, (ii) willful violation of specific and
lawful written directions from the Entrade's Board of
Directors that are consistent with your duties
described above, (iii) the use of illegal drugs or
substances in the work place, or (iv) excessive
tardiness, absenteeism, and/or poor work performance
resulting from the abuse of alcohol.
Good Reason: Good Reason includes any of the following:
i. Failure by Entrade to perform its
obligations under this agreement, unless the same is
promptly remedied to your reasonable satisfaction;
ii. Failure by the Board of Directors at any
time to elect you to, or your removal at any time
from, the office of General Counsel;
iii. Diminution that you reasonably
determine to be material in your duties with Entrade,
or interference that you reasonably determine to be
material and unreasonable in the performance of your
duties with Entrade, or assignment to you of duties
that you reasonably determine to be inconsistent with
the position of General Counsel of Entrade, unless
the same is promptly remedied to your reasonable
satisfaction;
iv. Change in Control of Entrade;
v. Sale or other transfer of all or any
substantial part of Entrade's assets; or
vi. Your death or disability.
Governing Law: Our understandings shall be governed by the laws of
the State of Illinois, exclusive of its choice of law
provisions.
Indemnification: Entrade will indemnify you to the fullest extent
permitted by law, and will advance to you defense
costs to the fullest extent permitted by law, in
connection with any and all actions, suits and
proceedings to which you may at any time be made or
threatened to be made a party by reason of (i) the
commencement of your employment with Entrade or the
fact that you are or were at any time serving or
designated to serve as a director, officer, or
employee of Entrade or any of its subsidiaries or
affiliated entities or in any other capacity at the
request or on behalf of Entrade or any of its
subsidiaries or affiliated entities or by reason, or
(ii) any act or nonact on your part in connection
therewith. The obligations of Entrade under this
Paragraph are absolute and unconditional, will
survive your death or disability, and will survive
the termination of your employment with Entrade for
any reason (whether such termination is during your
term of employment or after the expiration of the
term of your employment).
Attorneys' fees: You will be entitled to recover from Entrade all
attorneys' fees and other costs and expenses in
connection with enforcing this agreement against
Entrade and its successors.
Binding Effect: This Agreement supersedes all prior negotiations and
represents the entire Agreement of the parties, and
our signatures hereon will bind us hereto. This
Agreement inures to the benefit of Entrade, its
successors and assigns and will be binding upon, and
enforceable against, Entrade and its successors,
including any successor by merger or consolidation
and any entity or entities that acquire all or
substantially all of Entrade's assets, and, unless
Entrade makes other arrangements satisfactory to you
for the performance of its obligations under this
Agreement, Entrade will obtain the express written
assumption of this Agreement by each of its
successors. This Agreement will inure to the benefit
of, and be enforceable by, you and your heirs,
legatees, executors, and personal representatives
and, to the extent that they are entitled to receive
any compensation, benefit, payment or reimbursement
under any provision of this Agreement, your spouse
and any other beneficiaries; provided, however, that,
after your acceptance of this Agreement, you will
have the right at any time to amend, modify, or
terminate this Agreement and any provision hereof
(including any provision of this Agreement granting
any rights to your spouse or any other beneficiary)
without the consent or approval of your spouse or any
other beneficiary.
If the foregoing is acceptable to you, please sign and return a copy to
me.
Very truly yours,
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President
Accepted:
/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Dated: October __, 1999
