REVISED October 25, 2005

Mr. Kurt Gastrock
9705 Meadowmere Drive
Vienna, Virginia 22182

Dear Kurt:

I am pleased to offer you the position of Executive Vice President and Chief
Operating Officer of Convera Corporation (the “Company”). In this position you
will report directly to Patrick Condo, President and Chief Executive Officer.
This letter outlines the terms of the offer of employment. Your expected date of
employment is on or about November 7, 2005. 
 
1. Compensation.
 
a. Base Salary. As payment for the services to be rendered by you and subject to
the provisions hereinafter stated, the Company shall pay you a base salary at an
annualized rate of $300,000 per year, payable on the Company’s normal payroll
schedule (the “Base Salary”).
 
b. Bonus. In addition to your Base Salary, you will be eligible for a bonus (the
“Bonus”) up to $175,000 ($43,750 per quarter, at 100% performance against plan)
paid quarterly, 25% per quarter based upon the Company’s actual operating
performance, and based for Fiscal Year 2007 on successful quarterly execution of
the Company’s Fiscal Year 2007 Operating Plan approved by the Company’s Board of
Directors. Notwithstanding the performance nature of the Company's Bonus Plan,
the Company guarantees payment of the quarterly bonus for the fourth fiscal
quarter Fiscal Year 2006.
 
2. Employee Benefits.
 
a. Benefits. As a full-time employee you shall be eligible to participate in
such of the Company’s benefit plans as are now generally available or later made
generally available to full time employees of the Company, including 401(k)
plan, medical, dental, vision, life, long-term disability insurance plans.
Please refer to the Convera Summary of Benefits attached. You shall be entitled
to four weeks vacation per year.
 
b. Expense Reimbursement. The Company agrees to reimburse you for all
reasonable, ordinary and necessary travel and entertainment expenses incurred by
you in conjunction with your services to the Company consistent with the
Company’s standard reimbursement policies. The Company shall pay travel costs
incurred by you in conjunction with your services to the Company consistent with
the Company’s standard travel policy.
 
3. Equity Awards.
 
a.  Stock Options. Upon the start of your employment, you will be granted
options under the Company’s2000 Incentive Stock Option Plan (the “Plan”) to
purchase 500,000 shares of the Company’s Class A Common Stock. These stock
option grants are made at the market price at the time of grant, as determined
under the Plan, and vest 12.5% every six months. The Option will be an incentive
stock option to the maximum extent allowed by the tax code and will be subject
to the terms of the Plan and the Stock Option Agreement between you and the
Company, which will contain the standard terms and provisions applicable to
employees generally.
 
b.  Deferred Shares. Convera shall issue you, in accordance with and at such
time as provided in Sections 3.b(i) and 3.b(ii) of the Agreement, 200,000 shares
of Convera Class A Common Stock (the “Deferred Stock”). Such award will be
granted pursuant to, and is subject to the terms of the Plan. You will have a
nonforfeitable and vested interest in the Deferred Stock on the earliest of the
following (the “Deferred Date”):
 

(i)  
a date five years from your first date of employment provided that you remain
continuously employed with the Company through such date; or

 

(ii)  
the occurrence of a Change in Control while you are employed by the Company
followed (a) by continuous employment by you at the Company or the successor to
the Company for a period of 12 months or (b) within 12 months by a termination
of employment without Cause (as defined below) or a substantial diminution of
your duties and/or responsibilities compared to your duties and responsibilities
immediately prior to the Change of Control.

 
For purposes of this letter, a “Change in Control” means the happening of either
of the following:
 
A. The consummation of the sale or disposition by the Company of all or
substantially all of the Company’s assets; or
 
B. The Company combines or is consolidated with, or merges with or into, any
other corporation, and following such transaction a person or persons other than
a person, who alone or with others, as of the date of this Agreement
beneficially owns more than ten percent (10%) of the Company’s outstanding
voting securities, become the beneficial owner or owners of at least fifty
percent (50%) of the total voting power represented by the outstanding voting
securities of the Company or the surviving entity or its parent immediately
after such combination, consolidation or merger, and a majority of the Board of
Directors immediately after such transaction consists of individuals other than
individuals who served as directors immediately prior to such transaction.
 
4. Pre-Employment Conditions.
 
a. Proprietary Information Agreement. Your acceptance of this offer and
commencement of employment with the Company is contingent upon the execution,
and delivery to an officer of the Company, of the Company’s Employee Proprietary
Information and Inventions Agreement, a copy of which is enclosed for your
review and execution (the “Confidentiality Agreement”), prior to or on your
Start Date.
 
  b. Right to Work. For purposes of federal immigration law, you will be
required to provide to the Company documentary evidence of your identity and
eligibility for employment in the United States. Such documentation must be
provided to us within three (3) business days of your Start Date, or our
employment relationship with you may be terminated.
 
c. Verification of Information. This offer of employment is also contingent upon
the successful verification of the information you provided to the Company
during your application process, as well as a general background check performed
by the Company to confirm your suitability for employment. By accepting this
offer of employment, you warrant that all information provided by you is true
and correct to the best of your knowledge, and you expressly release the Company
from any claim or cause of action arising out of the Company’s verification of
such information.
 

5.  
No Conflicting Obligations. 

 
You understand and agree that by accepting this offer of employment, you
represent to the Company that your performance will not breach any other
agreement to which you are a party and that you have not, and will not during
the term of your employment with the Company, enter into any oral or written
agreement in conflict with any of the provisions of this letter or the Company’s
policies. You are not to bring with you to the Company, or use or disclose to
any person associated with the Company, any confidential or proprietary
information belonging to any former employer or other person or entity with
respect to which you owe an obligation of confidentiality under any agreement or
otherwise. The Company does not need and will not use such information and we
will assist you in any way possible to preserve and protect the confidentiality
of proprietary information belonging to third parties. Also, we expect you to
abide by any obligations to refrain from soliciting any person employed by or
otherwise associated with any former employer and suggest that you refrain from
having any contact with such persons until such time as any non-solicitation
obligation expires.
 

6.  
At-Will Employment.  

 
Your employment with the Company will be on an “at will” basis, meaning that
either you or the Company may terminate your employment at any time for any
reason or no reason, without further obligation or liability. The Company also
reserves the right to modify or amend the terms of your employment at any time
for any reason. This policy of at-will employment is the entire agreement as to
the duration of your employment and may only be modified in an express written
agreement duly authorized by the Company’s Board of Directors.
 
7. Severance Benefits.
 
General Terms. In no way limiting the Company’s policy of employment at-will, if
your employment is terminated (i) by the Company without Cause (as defined
below), or (ii) terminated by you for Good Reason (as defined below), in either
case, whether or not following or in connection with a Change in Control and
other than as a result of your death or disability, the Company will provide you
with the following:
 

a.  
Severance - equal to one year of your then-current regular Base Salary and Bonus
paid out over the Company’s regular payroll schedule following the effective
date of your release. Your health and dental insurance coverage for your
then-current Convera plans will be paid by Convera through the COBRA vehicle for
one year unless you receive comparable coverage under another company’s plan
before the end of that period at which point Convera’s payments would cease.

 

b.  
Vesting in Deferred Stock- nonforfeitable and vested interest in the Deferred
Stock equal to 20% of the total granted in Paragraph 3b above in the event that
your employment is terminated without Cause prior to the one year anniversary of
the commencement of employment, and 5% for any full quarter of continuous
employment with Convera after the first full year of employment.

 

c.  
Stock Options- stock options will continue to vest per the regular vesting
schedule in paragraph 3a above through the duration of the severance period.

 
As a condition to your receipt of such benefits, you are required to comply with
your continuing obligations (including the return of any Company property),
resign from all positions you hold with the Company, and execute the Company’s
standard form of release agreement, which provides for among other matters, the
release of any claims you may have against the Company and your agreement not to
solicit employees and customers.
 
Cause. For the purposes of this letter, “Cause” shall mean: (i) your repeated
failure to perform one or more of your essential duties and responsibilities to
the Company after 10 day written notice to you and a chance to cure; (ii) your
failure to follow the lawful directives of the Company’s Board of Directors;
(iii) your material violation of any Company policy, including any provision of
a Code of Conduct or Code of Ethics adopted by the Company; (iv) your commission
of any act of fraud, embezzlement, dishonesty or any other willful misconduct
that in the reasonable judgment of the Board of Directors has caused or is
reasonably expected to result in material injury to the Company; (v) your
unauthorized use or disclosure of any proprietary information or trade secrets
of the Company or any other party to whom you owe an obligation of nondisclosure
as a result of your relationship with the Company; (vi) your conviction of a
felony or misdemeanor (other than a traffic offense) or; (vii) your willful
breach of any of your obligations under any written agreement with the Company.
 
Good Reason For purposes of this letter, “Good Reason” shall mean (i) the
Company’s failure to make any required payment to you hereunder that remains
unremedied for 10 days after you have provided written notice of such failure to
the Chief Executive Officer or the Board of Directors of the Company, (ii) the
substantial diminution of your duties or responsibilities, (iii) a reduction in
your Base Salary or target Bonus of more than 10% unless applied to all senior
executives, (iv) the Company’s willful breach of any of its obligations under
any written agreement with you that remains unremedied for 10 days after you
have provided notice of such breach to the Chief Executive Officer or the Board
of Directors of the Company or (v) the relocation of the Company's executive
offices to a site more than 50 miles from its present location, except for a
relocation to, or within 50 miles of, its Carlsbad, California facilities (which
the Company has no present intention of effecting). In the event of relocation,
the Company will provide to you six months prior notice of any intended
relocation and agrees to reimburse you for reasonable relocation expenses
consistent with Convera’s prior relocation reimbursement practices for
executives.
 
To indicate your acceptance of the Company’s offer, please sign and date this
letter in the space provided below and return it to me, along with a signed and
dated original copy of the Employee Proprietary Information and Inventions
Agreement. Please indicate the date on which you expect to begin work in the
space provided below (the “Start Date”). This letter, together with the
Confidentiality Agreement, set forth the terms of your employment with the
Company and supersede any prior representations or agreements, whether written
or oral. This letter will be governed by the laws of Virginia, without regard to
its conflict of laws provisions, and may only be amended or modified by a
writing signed by both parties and approved by the Board of Directors.
 

 

 
We are all delighted to be able to extend you this offer and look forward to
working with you.
 
Very truly yours,

CONVERA CORPORATION

By:/s/Patrick C. Condo

Title: President and Chief Executive Officer

ACCEPTED AND AGREED:

KURT C. GASTROCK

/s/Kurt C. Gastrock 
Signature

 
Date: 11/1/2005
 
Anticipated Start Date: 11/9/2005
 
Attachment A: Employee Proprietary Information and Inventions Agreement
Attachment B:  Convera Summary of Benefits