Employment Contract - Executive

EXECUTIVE EMPLOYMENT AGREEMENT

(New Jersey – Comprehensive Template)

TABLE OF CONTENTS

I. Definitions
II. Operative Provisions
2.1 Employment; Duties and Authority
2.2 Term of Employment
2.3 Compensation and Benefits
2.4 Expense Reimbursement
2.5 Conditions Precedent and Subsequent
III. Representations & Warranties
IV. Covenants & Restrictions
V. Default & Remedies
VI. Risk Allocation
VII. Dispute Resolution
VIII. General Provisions
IX. Execution Block

AGREEMENT HEADER

This Executive Employment Agreement (this “Agreement”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

• [COMPANY NAME], a [STATE OF INCORPORATION] corporation having its principal place of business at [COMPANY ADDRESS] (the “Company”); and
• [EXECUTIVE NAME], residing at [EXECUTIVE ADDRESS] (“Executive”).

The Company and Executive are each a “Party” and collectively the “Parties.”

RECITALS

A. The Company desires to employ Executive in a senior executive capacity; and
B. Executive possesses the requisite skill and experience and is willing to accept such employment under the terms and conditions set forth herein;

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

I. DEFINITIONS

The following terms, when capitalized, have the meanings set forth below. Defined terms include all grammatical variations and shall apply equally to the singular and plural forms.

“AAA” means the American Arbitration Association.

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such first Person.

“Base Salary” has the meaning assigned in Section 2.3(a).

“Board” means the Board of Directors of the Company.

“Cause” means (i) Executive’s material breach of this Agreement or any material written policy of the Company that remains uncured [CURE PERIOD] days after written notice; (ii) willful misconduct or gross negligence in the performance of Executive’s duties; (iii) conviction of, or plea of nolo contendere to, a felony or any crime involving moral turpitude; (iv) fraud, embezzlement, or dishonesty that is materially injurious to the Company; or (v) material violation of federal or state securities laws.

“Change in Control” means the first to occur of:
(a) a sale of all or substantially all of the Company’s assets;
(b) any merger, consolidation, or reorganization resulting in the holders of the Company’s voting securities immediately prior thereto owning less than 50% of the combined voting power immediately thereafter; or
(c) any Person or group becoming the beneficial owner of more than 50% of the combined voting power of the Company.

“Code” means the Internal Revenue Code of 1986, as amended, and Treasury regulations thereunder.

“Confidential Information” has the meaning set forth in Section 4.1.

“Disability” means a physical or mental impairment rendering Executive unable to perform the essential functions of Executive’s position for 90 consecutive or 120 aggregate days within any 12-month period.

“Good Reason” means, without Executive’s written consent: (i) a material reduction in Base Salary; (ii) a material diminution in Executive’s title, authority, or responsibilities; (iii) relocation of Executive’s principal work location by more than 35 miles; or (iv) the Company’s material breach of this Agreement, in each case subject to the notice and cure provisions of Section 5.2(c).

“Involuntary Termination” means a termination by the Company without Cause or by Executive for Good Reason.

“Restrictive Period” has the meaning given in Section 4.3(b).

“Severance Benefits” has the meaning given in Section 5.3.

“Severance Period” means the [NUMBER OF MONTHS]-month period following a Qualifying Termination.

“Work Product” has the meaning set forth in Section 4.2.

II. OPERATIVE PROVISIONS

2.1 Employment; Duties and Authority

(a) Position. The Company hereby employs Executive as its [TITLE] reporting directly to [THE BOARD / CEO].

(b) Duties. Executive shall have such authorities, duties, and responsibilities customary for an executive in that position, including [SPECIFIC RESPONSIBILITIES]. Executive shall devote substantially all working time and best efforts to the Company and its Affiliates.

(c) Outside Activities. Executive may engage in civic or charitable activities and serve on outside boards with prior written Board approval, provided such activities do not materially interfere with performance of Executive’s duties.

2.2 Term of Employment

The employment term (the “Term”) shall commence on the Effective Date and continue until terminated pursuant to Article V. Unless expressly stated otherwise, the Term is at-will, subject to the termination provisions herein.

2.3 Compensation and Benefits

(a) Base Salary. Executive shall receive an annualized base salary of $[AMOUNT] (“Base Salary”), payable in accordance with the Company’s regular payroll practices, subject to applicable withholdings and deductions required by law.

(b) Annual Bonus. Executive shall be eligible for an annual performance bonus with a target opportunity of [PERCENTAGE]% of Base Salary (“Target Bonus”). Actual payout, if any, shall be determined by the Board or its Compensation Committee (the “Committee”) based on Company and individual performance metrics established in good faith. Bonuses are deemed earned only upon written certification by the Committee and are contingent upon Executive’s continuous employment through the payment date, except as otherwise provided in Section 5.3.

(c) Long-Term Incentives. Executive shall participate in the Company’s equity or long-term incentive plan (“LTIP”) on terms no less favorable than those provided to similarly situated executives, with annual awards having a target grant-date fair value of $[AMOUNT].

(d) Benefits. Executive will be eligible to participate in all employee benefit plans maintained by the Company for senior executives, including group health, life, disability, and retirement plans, subject to the terms of those plans and applicable law.

(e) Paid Time Off. Executive shall be entitled to paid time off under Company policy. If Executive is covered by the New Jersey Earned Sick Leave Law, the policy must provide at least one hour of earned sick leave for every thirty (30) hours worked, up to forty (40) hours per benefit year, or front-load an equivalent compliant amount, under N.J.S.A. 34:11D-1 to -11.

(f) Section 409A Compliance. The Parties intend that all payments under this Agreement comply with or are exempt from Code § 409A and shall interpret and administer the Agreement accordingly.

2.4 Expense Reimbursement

Upon presentation of reasonable documentation, the Company shall promptly reimburse Executive for all ordinary and necessary business expenses incurred in the performance of duties in accordance with the Company’s expense reimbursement policy.

2.5 Conditions Precedent and Subsequent

(a) Background Check & Work Authorization. This Agreement is contingent upon satisfactory completion of any pre-employment screening and proof of work authorization as required by law.

(b) Compliance with Policies. Executive shall comply with all lawful policies and codes of conduct adopted by the Board and provided to Executive in writing, as amended from time to time.

III. REPRESENTATIONS & WARRANTIES

3.1 Mutual Representations. Each Party represents that:
(a) it has full power and authority to enter into this Agreement and perform its obligations; and
(b) entering into this Agreement does not violate any other agreement or legal obligation.

3.2 Executive’s Additional Representations. Executive further represents and warrants that:
(a) Executive is not a party to any restrictive covenant, non-competition, or confidentiality agreement that would impair or conflict with Executive’s duties hereunder;
(b) Executive will not disclose to the Company or induce the Company to use any confidential information belonging to any prior employer or third party; and
(c) all information provided during the hiring process is true and accurate in all material respects.

3.3 Survival. The representations and warranties in this Article III shall survive the expiration or termination of this Agreement as expressly provided herein.

IV. COVENANTS & RESTRICTIONS

4.1 Confidentiality

Executive shall not, during or after the Term, directly or indirectly disclose, use, or misappropriate any Confidential Information, except in the good-faith performance of duties or with the Company’s prior written consent. “Confidential Information” includes non-public proprietary information of the Company or its Affiliates, but excludes information Executive can document was lawfully known without a confidentiality duty, became public through no breach, or was lawfully received from a third party without a confidentiality duty. “Trade Secret” has the meaning stated in N.J.S.A. 56:15-2.

Protected Disclosures; DTSA Notice. Nothing in this Agreement prohibits lawful reports to government officials or attorneys, communications with government agencies, or other protected whistleblower activity. Under 18 U.S.C. § 1833(b), an individual is immune from federal and state trade-secret liability for a confidential disclosure to a government official or attorney made solely to report or investigate a suspected violation of law, or for a disclosure in a court filing made under seal. In an anti-retaliation action, the individual may disclose a trade secret to counsel and use it in the proceeding if filings containing it are under seal and disclosure is otherwise limited to court order.

4.2 Intellectual Property & Work Product

Executive hereby assigns to the Company all right, title, and interest in inventions, works of authorship, developments, or improvements created within the scope of employment, using material Company resources, or relating directly to the Company's actual or demonstrably anticipated business or research (“Work Product”). Executive shall list pre-existing intellectual property on Schedule B; listed property remains Executive's property, subject to any express license stated there.

4.3 Restrictive Covenants

(a) Non-Competition. During the Term and for [6-12] months thereafter (the “Restrictive Period”), Executive shall not provide services the same as or substantially similar to those Executive performed or supervised for the Company for a Competitor within [AREA WHERE EXECUTIVE MATERIALLY WORKED, SUPERVISED OPERATIONS, OR HELD CUSTOMER RESPONSIBILITY]. The restriction is intended only to protect identified legitimate interests such as Trade Secrets, qualifying Confidential Information, and customer relationships developed through Executive's work; it must impose no undue hardship on Executive, cause no injury to the public, and be reasonable in duration, area, and scope under New Jersey law.

(b) Non-Solicitation of Customers. For the Restrictive Period, Executive shall not solicit or attempt to solicit any material customer or client of the Company with whom Executive had material contact during the 12 months preceding termination for a purpose competitive with the Company.

(c) Non-Solicitation of Employees. For the Restrictive Period, Executive shall not directly solicit for competitive employment a Company employee with whom Executive materially worked during the final twelve (12) months of employment. General advertisements not targeted at Company personnel do not violate this clause.

(d) Reasonableness; Partial Enforcement. The Parties request enforcement only to the extent consistent with the fact-sensitive test stated in Accounteks.Net, Inc. v. CKR Law, LLP, 475 N.J. Super. 493 (App. Div. 2023). A court may refuse enforcement or partially enforce a restriction as New Jersey law permits; this clause does not guarantee judicial modification.

(e) Company Remedies. Breach of this Article IV constitutes Cause and entitles the Company to injunctive relief and other remedies as outlined in Article V.

V. DEFAULT & REMEDIES

5.1 Events of Default

(a) Company Default. The Company’s material breach of any provision herein.
(b) Executive Default. (i) Breach of Article IV; (ii) any act or omission constituting Cause.

5.2 Notice and Cure

(a) Company Breach. Executive shall provide written notice of Company default, specifying the facts constituting breach. The Company shall have 30 days to cure except breaches of payment obligations, which must be cured within 10 days.

(b) Executive Breach (Non-Cause). Company shall provide written notice; Executive shall have 15 days to cure if curable.

(c) Good Reason Procedure. Executive must provide notice within 60 days after first learning of grounds for Good Reason and allow a 30-day cure period. If uncured, Executive must resign within 30 days thereafter for the resignation to constitute Good Reason.

5.3 Severance; Graduated Remedies

(a) Qualifying Termination. Upon an Involuntary Termination, subject to Executive’s timely execution and non-revocation of a release of claims (the “Release”) and continued compliance with Article IV:

1. Cash Severance: Base Salary continuation at the then-current rate for the Severance Period, payable in accordance with regular payroll, commencing on the first payroll date after the Release becomes effective;
2. Pro-Rata Bonus: A lump-sum payment of the Target Bonus, pro-rated for the fiscal year through the date of termination;
3. COBRA Subsidy: Company-paid COBRA premiums for group health coverage for the Severance Period or, if earlier, until Executive becomes eligible for comparable coverage elsewhere;
4. Equity Acceleration: Immediate vesting of the portion of outstanding equity awards that would have vested during the Severance Period.

Any nonqualified deferred compensation payable because of separation from service to a specified employee of a publicly traded corporation shall be delayed only to the extent and for the period required by Code § 409A(a)(2)(B)(i).

(b) Termination for Cause; Voluntary Resignation (other than Good Reason). Executive shall receive only accrued but unpaid Base Salary, earned compensation, reimbursable expenses, and benefits required by law (collectively, “Accrued Obligations”). Accrued Obligations are not conditioned on signing the Release. Under N.J.S.A. 34:11-4.3, all wages due must be paid no later than the regular payday for the pay period in which employment ended. Unused statutory earned sick leave need not be paid at separation unless a Company policy or agreement provides otherwise.

(c) Death or Disability. In addition to Accrued Obligations, Executive (or estate) shall receive: (i) pro-rated Target Bonus for the year of termination, (ii) immediate vesting of all time-based equity awards, and (iii) benefits pursuant to applicable insurance programs.

5.4 Change-in-Control Protection

If a Qualifying Termination occurs within 12 months following a Change in Control (“Double-Trigger”), Executive shall receive the Severance Benefits in Section 5.3(a), except that: (i) Base Salary continuation shall be replaced by a single lump-sum payment equal to [1.0-2.0]× the sum of Base Salary plus Target Bonus; and (ii) 100% of outstanding equity awards shall vest (with performance awards deemed earned at target unless otherwise specified in the governing plan).

☐ Payments will be reduced to the minimum extent necessary to avoid an excise tax under Code § 4999, but only if the reduction produces a greater net after-tax benefit to Executive. ☐ No cutback; Executive bears any tax under Code § 4999. Any gross-up requires separate tax drafting under Code §§ 280G and 4999.

5.5 Attorneys’ Fees

The prevailing Party in any action to enforce this Agreement shall be entitled to reasonable attorneys’ fees and costs.

VI. RISK ALLOCATION

6.1 Indemnification

(a) Company Indemnity. To the fullest extent permitted by the law governing the Company's internal affairs and its organizational documents, the Company shall indemnify Executive for expenses and liabilities incurred by reason of Executive's service as an officer. If N.J.S.A. 14A:3-5 applies, indemnification is subject to its standards of conduct, required determinations, and limitations.

(b) Advancement of Expenses. The Company shall advance reasonable expenses, including attorneys' fees, only after receipt of the undertaking to repay required by N.J.S.A. 14A:3-5(6), if that statute applies, and satisfaction of applicable organizational-document conditions.

(c) D&O Insurance. The Company shall maintain directors’ and officers’ liability insurance covering Executive on terms no less favorable than those applicable to any other senior executive or director.

6.2 Limitation of Liability

Except for liability arising from (i) Executive’s breach of Article IV; (ii) either Party’s fraud or willful misconduct; or (iii) indemnification obligations under Section 6.1, each Party’s aggregate liability under this Agreement shall not exceed $[CAP AMOUNT].

6.3 Insurance Requirements

The Company shall obtain and maintain during the Term and for a period of at least [XX] months thereafter customary insurance coverage (e.g., general liability, EPLI) in commercially reasonable amounts.

6.4 Force Majeure

Neither Party shall be liable for failure to perform due to causes beyond its reasonable control, including natural disaster, war, terrorism, epidemic, or governmental action, provided that the affected Party gives prompt written notice and uses commercially reasonable efforts to mitigate.

VII. DISPUTE RESOLUTION

7.1 Governing Law

This Agreement and all claims, controversies, or causes of action arising under or relating hereto shall be governed by and construed in accordance with the laws of the State of New Jersey, without regard to its conflict-of-laws principles.

7.2 Arbitration

Except as provided in Sections 7.3 and 7.4, any dispute arising out of or relating to this Agreement, the employment relationship, or termination thereof shall be finally resolved by confidential, binding arbitration administered by the AAA under its Employment Arbitration Rules then in effect. At the election provided by 9 U.S.C. § 402, this clause does not require arbitration of a case relating to a sexual-assault or sexual-harassment dispute as defined in 9 U.S.C. § 401. The arbitration shall be conducted before a single neutral arbitrator in [COUNTY], New Jersey. Judgment on the award may be entered in any court of competent jurisdiction. Nothing in this clause prospectively waives a substantive or procedural right or remedy relating to discrimination, retaliation, or harassment in violation of N.J.S.A. 10:5-12.7; counsel must tailor the clause to controlling law when the Agreement is signed.

7.3 Injunctive Relief

Notwithstanding Section 7.2, either Party may seek temporary, preliminary, or permanent injunctive or other equitable relief in the Superior Court of New Jersey, [VENUE] County, to enforce Article IV or preserve the status quo pending arbitration.

7.4 Forum Selection for Non-Arbitrable Claims

Any claim that is not subject to arbitration (e.g., request for temporary injunctive relief or claims expressly excluded by law) shall be brought exclusively in the state courts of New Jersey sitting in [VENUE] County, and each Party consents to the personal jurisdiction and venue of such courts.

7.5 [Optional] Jury-Trial Waiver

[OPTION, STRIKE IF NOT ADOPTED] THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY, AND IRREVOCABLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY JUDICIAL PROCEEDING PERMITTED UNDER THIS ARTICLE VII.

This optional waiver does not apply to a right or remedy that N.J.S.A. 10:5-12.7 or other controlling law makes non-waivable.

VIII. GENERAL PROVISIONS

8.1 Amendment and Waiver. No amendment or waiver shall be effective unless in a writing signed by both Parties. Failure to enforce any provision shall not constitute a waiver of future enforcement.

8.2 Assignment and Delegation. Neither Party may assign this Agreement without the other’s prior written consent, except the Company may assign to a successor in interest in connection with a Change in Control. Any purported assignment in violation of this Section is void.

8.3 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

8.4 Severability and Reformation. If any provision is held invalid or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be reformed to the minimum extent required to make it valid and enforceable.

8.5 Integration / Entire Agreement. This Agreement, together with any equity award agreements and the Company’s written policies referenced herein, constitutes the entire agreement between the Parties and supersedes all prior oral or written understandings relating to the subject matter.

8.6 Notices. All notices shall be in writing and deemed given when delivered (i) by hand with signed receipt, (ii) by certified mail, return receipt requested, postage prepaid, or (iii) by nationally recognized overnight courier with confirmation, in each case addressed as follows (or as updated by notice):

• If to the Company: [ADDRESS; ATTENTION: CORPORATE SECRETARY]
• If to Executive: [ADDRESS ON FILE]

8.7 Counterparts; Electronic Signatures. The Parties agree to conduct this transaction by electronic means. This Agreement may be executed in counterparts, including by electronic signature, each deemed an original and all together one instrument. Under N.J.S.A. 12A:12-7, a record, signature, or contract may not be denied legal effect solely because it is electronic, subject to the party-agreement rule in N.J.S.A. 12A:12-5.

8.8 Headings. Section headings are for convenience only and shall not affect interpretation.

8.9 Withholding. The Company may withhold from any amounts payable hereunder such federal, state, or local taxes as are required to be withheld pursuant to any applicable law or regulation.

8.10 Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event of ambiguity, no presumption shall arise favoring either Party.

IX. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Executive Employment Agreement as of the Effective Date.

[Corporate Seal, if any]

SCHEDULE A (Optional) – FORM OF RELEASE AGREEMENT

In exchange for the Severance Benefits, which exceed amounts otherwise owed, Executive releases Company and its affiliates, successors, and their current and former officers, directors, employees, and agents from claims arising on or before the date Executive signs this Release, to the fullest extent lawfully waivable.

This Release does not waive: (i) claims arising after signature; (ii) vested retirement benefits; (iii) workers' compensation or unemployment rights; (iv) indemnification rights; (v) the right to file a charge, communicate with, or participate in an investigation by a government agency; (vi) lawful whistleblower awards; or (vii) any other non-waivable right. No provision prospectively waives a right or remedy relating to discrimination, retaliation, or harassment contrary to N.J.S.A. 10:5-12.7. Any confidentiality term must comply with N.J.S.A. 10:5-12.8 and may not conceal details relating to such a claim.

ADEA/OWBPA election for an Executive age forty (40) or older:

If applicable, the released claims expressly include claims under the Age Discrimination in Employment Act, 29 U.S.C. §§ 621-634, through the signature date.

☐ Individual termination: at least twenty-one (21) days to consider.

☐ Qualifying group program: at least forty-five (45) days to consider, with the disclosures required by 29 U.S.C. § 626(f)(1)(H).

Executive is advised in writing to consult an attorney before signing and may revoke an ADEA waiver by written notice to [CONTACT/ADDRESS] within seven (7) days after signing. The ADEA waiver becomes effective only after that period expires without revocation and does not waive future claims.

The Protected Disclosures and DTSA Notice in Section 4.1 are incorporated into this Release.

SCHEDULE B – PRE-EXISTING INTELLECTUAL PROPERTY

☐ None.

☐ Excluded items: [DESCRIBE WITH SUFFICIENT PARTICULARITY].

Sources and References

• New Jersey Earned Sick Leave Act, P.L.2018, c.10
• New Jersey Department of Labor — earned sick leave
• N.J.S.A. 34:11-4.3 — final wage payment
• New Jersey Trade Secrets Act, P.L.2011, c.161
• Employment-waiver and confidentiality law, P.L.2019, c.39
• N.J.S.A. 14A:3-5 — indemnification and advancement
• New Jersey Uniform Electronic Transactions Act, P.L.2001, c.116
• Accounteks.Net, Inc. v. CKR Law, LLP — published restrictive-covenant opinion
• 18 U.S.C. § 1833 — protected trade-secret disclosures
• 29 U.S.C. § 626 — ADEA waiver requirements
• 9 U.S.C. §§ 401-402 — sexual-assault and sexual-harassment disputes
• 26 U.S.C. § 409A — nonqualified deferred compensation
• 26 U.S.C. § 280G — golden parachute payments
• 26 U.S.C. § 4999 — excess-parachute-payment excise tax

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