**Exhibit 10.1****EMPLOYMENT AGREEMENT**     THIS EMPLOYMENT AGREEMENT entered into as of this 7th day of August2007, by and between Patriot Capital Funding, Inc. (the “Company”), a Delaware corporation, andWilliam E. Alvarez, Jr., an individual (the “Executive”) (hereinafter collectively referred to asthe “Parties”).     WHEREAS, the Parties previously entered into an employment agreement dated December 16, 2005,and the Parties now wish to extend the term of, make certain changes to, and restate thatemployment agreement.     WHEREAS, the Company and the Executive desire to enter into this agreement (the “Agreement”)which will supersede the prior employment agreement and will provide for the continued employmentof the Executive by the Company upon the terms and subject to the conditions set forth herein.     NOW, THEREFORE, in consideration of the respective agreements of the Parties contained herein,it is agreed as follows:     1. Term. The term of employment (the “Term”) under this Agreement shall be the periodcommencing on August 7, 2007 through December 31, 2009 unless terminated earlier by either Partypursuant to Section 7.     2. Employment.          (a) During the Term, the Executive shall be employed as the Executive Vice-President and ChiefFinancial Officer of the Company or such other position as may be mutually agreed upon in writingby the Parties. The Executive shall perform the duties, undertake the responsibilities and exercisethe authority customarily performed, undertaken and exercised by persons situated in a similarexecutive capacity in a company the size and nature of the Company.          (b) The Executive shall devote his full working time, attention and skill to the performanceof such duties, services and responsibilities, and will use his best efforts to promote theinterests of the Company. The Executive will not, without prior written approval of the ChiefExecutive Officer of the Company (the “CEO”), engage in any other activities that would interferewith the performance of his duties as an employee of the Company, are in violation of writtenpolicies of the Company that the Executive has actually received, are in violation of applicablelaw, or would create a conflict of interest with respect to the Executive’s obligations as anemployee of the Company. The Executive may (i) serve on corporate (subject to the prior approval ofthe CEO) or charitable or municipal boards or committees, (ii) deliver lectures and teach ateducational institutions, (iii) manage his personal affairs, including financial and legal aspectsthereto, and (iv) invest personally in any business where no conflict of interest exists betweensuch investment and the business of the Company, as long as the foregoing activities are consistentwith the Executive’s commitments in the preceding sentence and Section 9 hereof and do not interfere with the Executive’s performance of his duties and responsibilities for theCompany or any affiliate.
 

 
     3. Base Salary. The Company agrees to pay or cause to be paid to the Executive duringthe Term a base salary at the annual rate of $275,000 (as adjusted from time to time in accordancewith this Section, the “Base Salary”), effective August 1, 2007. Such Base Salary shall be payablein accordance with the Company’s customary practices applicable to its executives. Such BaseSalary shall be reviewed at least annually on or about March of each year during the Term and maybe increased in the sole discretion of the CEO or his delegate. For the avoidance of doubt, suchreview shall include a review of the $275,000 annual rate on or about March 2008. Such Base Salarymay be reduced only if such reduction is implemented by the Company as part of an overall generalsalary reduction affecting all of its employees and such reduction to the Base Salary on apercentage basis is equal to or less than the percentage reduction otherwise implemented.     4. Annual Bonus. During the Term, the Executive shall be eligible to receive anannual bonus (the “Annual Bonus”) as set forth in this Section. For each calendar year beginningwith 2007, the Executive shall be eligible for an Annual Bonus based on an award range of 50% ofthe Executive’s then-current Base Salary for achieving base performance objectives and 125% of theExecutive’s then-current Base Salary for achieving the highest level of performance objectives.For the avoidance of doubt, if the base performance objectives are not achieved, the Executiveshall not be entitled to an Annual Bonus under the preceding sentence, although the CompensationCommittee of the Board of Directors or its delegate may choose to award the Executive adiscretionary Annual Bonus despite not achieving base performance objectives. The objectives forthe Annual Bonus, which may include quantitative and qualitative objectives, shall be determined bythe Compensation Committee or its delegate no later than 60 days after the beginning of theapplicable measurement period, and the amount of any Annual Bonus shall be determined by theCompensation Committee or its delegate and paid no later than March 15 of the following year.Notwithstanding the foregoing, the Executive’s Annual Bonus for 2007 shall in no event be less than$175,000.     5. Options. The Executive shall be eligible for annual option grants during the Termin accordance with the applicable Company option plan.     6. Employee Benefits.          (a) During the Term, subject to the Company’s right to amend, modify, or terminate any plan orprogram, the Executive shall be entitled to participate in all employee benefit plans, practicesand programs maintained by the Company and made available to employees generally including, withoutlimitation, all pension, retirement, savings, medical, hospitalization, disability, dental, life ortravel accident insurance benefit plans, vacation and sick leave. The Executive’s participation insuch plans, practices and programs shall be on a basis and subject to terms no less favorable thanapplicable to employees of the Company generally (subject to applicable tax code and other legalrestrictions), provided, however, that such participation may be on a basis and subject to termsmore favorable than applicable to employees of the Company generally.
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          (b) During the Term, subject to the Company’s right to amend, modify or terminate any suchplans or benefits, the Executive shall be entitled to participate in all executive benefit plans,and fringe benefit and perquisite arrangements now maintained or hereafter established by theCompany for the purpose of providing compensation and/or benefits generally to executivevice-presidents and “chief” level executives of the Company. Unless otherwise provided herein, theExecutive’s participation in such plans shall be on a basis and subject to terms no less favorablethan applicable to other similarly situated executive vice-presidents and “chief” level executivesof the Company.          (c) During the Term, the Company agrees to pay all reasonable business expenses, subject toreasonable documentation, incurred by the Executive in furtherance of the Company’s business,including, without limitation, continuing education, obtaining professional licenses, traveling,and entertainment expenses, in accordance with the Company’s policies.          (d) During the Term, if the Executive agrees to relocate his residence at the Company’srequest, the Company shall pay all reasonable relocation expenses, subject to reasonabledocumentation, including, but not limited to, the costs of moving the Executive’s household goodsand real estate commission costs related to selling the Executive’s home, provided, however, thatsuch relocation expenses shall not include any loss on the sale of the Executive’s home or anycosts related to the purchase of the Executive’s new home, such as closing costs or mortgagepoints. The Company will also make a payment to the Executive in the amount necessary to ensurethat the Executive, after all applicable federal, state, and local taxes, and taking into accountany tax deductions available to the Executive, is in the same economic position as if the Executivehad not been subject to tax on the Company’s payment or reimbursement of relocation expenses.     7. Termination of Employment. The Executive’s employment by the Company may beterminated by either the Executive or the Company at any time and, except as expressly set forth inthis Section 7, with no requirement of notice or explanation from either Party. Upon theExecutive’s termination of employment during the Term, the Executive shall be entitled to thepayments and benefits described below.          (a) *Termination by the Executive Without Good Reason or Due to Death or Disability.*If duringthe Term the Executive voluntarily terminates employment with the Company without Good Reason (asdefined below) or due to death or Disability (as defined below), the Company shall pay theExecutive any earned but unpaid Base Salary for the period through termination of employment, anyAnnual Bonus payment with respect to a completed measurement period that is fully earned and vestedat separation or death but not yet paid, any amounts to which the Executive is legally entitledunder the generally applicable terms of pension, savings, disability, life insurance, or otherprograms, and any business expenses that would otherwise be reimbursed under the Company’spolicies. In addition, if the Executive terminates employment with the Company due to death orDisability, then with respect to any Annual Bonus measurement period during which the Executiveterminates employment, the Company shall pay the Executive (or, in the case of death, theExecutive’s beneficiary) a lump sum cash amount equal to a pro rata portion, based on the length ofthe Executive’s service with
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the Company during such period, of the Average Annual Bonus (as defined below). Furthermore,if the Executive terminates employment with the Company due to death, then the Company shall paythe Executive’s beneficiary in a lump sum payment an amount equal to one-half of the sum of (i) theExecutive’s annual Base Salary for the year in which he terminates employment and (ii) his AverageAnnual Bonus. Other than the payments and benefits described in this Section 7(a), the Companywill be under no obligation to make additional severance or similar payments to the Executive orhis beneficiary, as the case may be.          (b) *Termination by the Company Without Cause or by the Executive With Good Reason*. If duringthe Term the Company terminates the Executive’s employment without Cause (as defined below) or theExecutive terminates employment with Good Reason (as defined below), subject to the Executive’scompliance with Section 7(d), Section 7(e), and Section 9 hereof, the Company shall provide thepayments and benefits described in this Section 7(b). The Company shall pay the Executive the sumof (i) his annual Base Salary for the year in which he terminates employment and (ii) his AverageAnnual Bonus. Such amount shall be paid in equal monthly installments through the 12-monthanniversary of the Executive’s termination of employment, provided, however, that if the first sixmonths of installments constitute deferred compensation subject to section 409A of the InternalRevenue Code and the Executive is a “specified employee” within the meaning of section 409A of theInternal Revenue Code, then the first six months of installments shall be paid in a single lump sumsix months after the Executive’s termination of employment, and the remaining installments shall bepaid monthly through the 12-month anniversary of the Executive’s termination of employment. Forpurposes of section 409A of the Internal Revenue Code, installment payments under this Section 7shall each be treated as separate payments. With respect to any Annual Bonus measurement periodduring which the Executive is terminated, the Company shall also pay the Executive a lump sum cashamount equal to a pro rata portion, based on the length of the Executive’s service during suchmeasurement period, of the Average Annual Bonus, payable at the same time as the first payment ofseverance described in the preceding sentences. In addition, the Executive’s stock options shallbecome 100% vested and immediately exercisable for their full term.     The Company shall provide continued medical and dental insurance coverage during the 12 monthsfollowing the Executive’s termination of employment (or until the Executive becomes eligible forsuch coverage under another employer’s program, if sooner), which coverage shall be deemed tosatisfy COBRA health coverage requirements for such period, at a cost to the Executive that doesnot exceed the amount the Executive would have paid had the Executive continued in employmentduring the period. Should the Executive’s continued participation under the Company’s medical anddental insurance programs described above become impermissible under the Internal Revenue Code,ERISA, or other applicable law, or likely to result in adverse tax consequences to the Company orother participants covered by such programs, the Company may, in its sole discretion, satisfy anyof its obligations to the Executive under this paragraph by providing the Executive witheconomically equivalent coverage through alternative arrangements, or the cash value of suchcoverage, in a manner that places the Executive in a net economic position that is at leastequivalent to the position in which the Executive would have been had such alternative arrangementsnot been used by the Company.
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     The Company shall also pay the Executive any earned but unpaid Base Salary for the periodthrough termination of employment, any Annual Bonus awards with respect to a completed measurementperiod that are fully earned and vested at separation but not yet paid, and any amounts to whichthe Executive is entitled under the generally applicable terms of pension, savings, disability,life insurance, or other programs. Other than the payments and benefits described in this Section7(b), the Company will make no additional severance or similar payments.          (c) *Termination by the Company With Cause*. If the Company terminates the Executive’semployment with Cause, the Company shall pay the Executive only any earned but unpaid Base Salaryfor the period through termination of employment and any amounts to which the Executive is legallyentitled under the generally applicable terms of pension, savings, disability or other programs.          (d) *Release of Claims*. As a condition to receiving the severance, benefits and entitlementspursuant to Section 7(a) (other than benefits payable upon death) or Section 7(b) hereof, theExecutive shall be required to deliver to the Company and not revoke a general release of claimsagainst the Company, its affiliates, and their officers, directors, employees and agents insubstantially the form attached hereto as Exhibit A. The Executive shall be afforded seven daysafter execution and delivery of such release to revoke it, in which event the Executive shall notbe entitled to the payments, rights or other entitlements hereunder other than as required byapplicable law.          (e) *Resignation*. Notwithstanding any other provision of this Agreement, upon the terminationof the Executive’s employment for any reason, unless otherwise requested by the Company, theExecutive shall immediately resign from the board of directors of the Company, if applicable, andfrom the boards of directors of any affiliates of the Company and as a trustee of, or fiduciary to,any employee benefit plans of the Company or any of its affiliates. The Executive agrees toexecute any and all documentation of such resignations upon request by the Company, but he shall betreated for all purposes as having so resigned upon termination of his employment regardless ofwhen or whether he executes any such documentation.     8. Definitions. The following terms shall have the following meanings for purposes ofthis Agreement.     “Cause” means (i) the Executive’s willful and continued failure to performsubstantially his or her duties with the Company (other than any such failure resulting from theExecutive’s incapacity due to physical or mental illness or any such failure subsequent to theExecutive being delivered a notice of termination without Cause by the Company or delivering anotice of termination for Good Reason to the Company that results in the Executive’s termination ofemployment) after a written demand for substantial performance is delivered to the Executive by theCompany which specifically identifies the manner in which the Company believes that the Executivehas failed to perform substantially his or her duties; (ii) the Executive’s willfully engaging ingross misconduct which is injurious to the Company or its affiliates, (iii) theExecutive’s ineligibility to serve as an employee, officer, or director of the Company pursuant toSection 9 of the Investment Company Act of 1940, as amended, or (iv) the Executive’s
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conviction of a felony or crime involving moral turpitude; provided, however, that a failure on thepart of the Executive to achieve performance objectives set by the Company shall not in and ofitself constitute Cause pursuant to clause (i) hereof. Prior to terminating the Executive’semployment for Cause, the Company must notify the Executive in writing of any event purporting toconstitute Cause within 45 days of the Board’s knowledge of its existence and, if curable, mustprovide the Executive with at least 20 days to cure such event. If such event is not cured by theExecutive in such time period, or is incurable, then the Executive’s employment shall be terminatedfor Cause if 2/3 of the independent members of the Board determine in writing to so terminate hisemployment.     “Disability” means a physical or mental infirmity which impairs the Executive’sability to substantially perform his duties under this Agreement for at least one hundred eighty(180) days (which need not be consecutive) during any 365-consecutive-day period. The Executiveshall be entitled to the compensation and benefits provided for under this Agreement for any periodduring the Term and prior to the establishment of the Executive’s Disability during which theExecutive is unable to work due to a physical or mental infirmity.     “Good Reason” means, without the Executive’s express written consent, the occurrenceof any of the following events:          (i) any material change in the duties or responsibilities (including reportingresponsibilities) of the Executive that is inconsistent in any material and adverse respect withthe Executive’s position, duties, responsibilities or status with the Company (including anymaterial and adverse diminution of such duties or responsibilities); or          (ii) a material and adverse change in the Executive’s titles or offices (including, ifapplicable, membership on the Company’s Board of Directors) with the Company set forth in Section2(a) hereof;          (iii) a reduction by the Company in the Executive’s rate of annual Base Salary or an adversechange in the Executive’s Annual Bonus opportunity as a percentage of his Base Salary, provided,however, that the Executive’s rate of annual Base Salary may be reduced without being consideredGood Reason if such reduction is implemented by the Company as part of an overall general salaryreduction affecting all of its employees and such reduction to the Base Salary on a percentagebasis is equal to or less than the percentage reduction otherwise implemented;          (iv) a failure by the CEO or his delegate to determine performance objectives within 60 daysof the commencement of the applicable measurement period as required by Section 4;          (v) any requirement of the Company that the Executive be based anywhere more than 50 milesfrom the office where the Executive is located at the commencement of the Term or, if the Executivesubsequently agrees to a change in such location, 50 miles from such new office location; or
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          (vi) the failure of any purchaser of or successor to all or substantially all of the Company’sassets to assume the obligations of the Company contained in this Agreement, either in writing oras a matter of law.          The Executive must notify the Company of any event purporting to constitute Good Reason within45 days following the Executive’s knowledge of its existence, and the Company shall have 20 days inwhich to correct or remove such Good Reason, or such event shall not constitute Good Reason.     “Average Annual Bonus” means the average of the last two Annual Bonuses paid to theExecutive before his termination of employment.     9. Restrictive Covenants. In consideration of the Base Salary, Annual Bonus, options,employee benefits, and severance promises contained in this Agreement, the sufficiency of which ishereby acknowledged, the Executive enters into the following covenants.          (a) *Confidentiality*. The Executive shall not, without the prior express written consent ofthe Company, directly or indirectly, use for any purpose any Confidential Information (as definedbelow) in any way, or divulge, disclose or make available or accessible any ConfidentialInformation to any person, firm, partnership, corporation, trust or any other entity or third partyunless (i) such disclosure is reasonably necessary or appropriate in connection with theperformance by the Executive of his duties as an executive of the Company or (ii) such disclosureis required by applicable law or (iii) the Executive is requested or required by a judicial orarbitration body or governmental agency (by oral question, interrogatories, requests forinformation or documents, subpoena, civil investigative demand or similar process) to disclose anysuch information, in which case the Executive will (A) promptly notify the Company of such requestor requirement, so that the Company may seek an appropriate protective order and (B) cooperate withthe Company, at its expense, in seeking such an order. “Confidential Information” means allinformation respecting the business and activities of the Company and any of its affiliates,including, without limitation, respecting the clients, customers, suppliers, employees,consultants, prospects, computer or other files, projects, products, computer disks or other media,computer hardware or computer software programs, underwriting, lending or investment standards,marketing plans, financial information, methodologies, know-how, processes, trade secrets,policies, practices, projections, forecasts, formats, operational methods, product developmenttechniques, research, strategies or information agreed to with third-parties to be keptconfidential by the Company and any of its affiliates. Notwithstanding the immediately preceding sentence, Confidential Information shall notinclude any information that is, or becomes, a part of the public domain or generally available tothe public (unless such availability occurs as a result of any breach by the Executive of thisAgreement) or any business knowledge and experience of the type usually acquired by persons engagedin positions similar to the Executive’s position with theCompany, to the extent such knowledge and experience is non-Company specific and not proprietary to the Companyor any of its affiliates.          (b) *Non-Competition*. During the Term and ending one year after the Executive’s termination ofemployment with the Company, the Executive shall not, without the
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prior written consent of the Company, engage in any business or activity, whether as anemployee, consultant, partner, principal, agent, representative, stockholder (other than as theholder of an interest of two percent or less in the equity of a publicly traded corporation) orother individual, corporate or representative capacity, or render any services or provide anyadvice or assistance to any business, person or entity, if such business, activity, person orentity competes anywhere in the same geographic area with the Company or any of its affiliates inrespect of (i) any then-current product, service or business of the Company or any of itsaffiliates on the date the Executive terminates employment with the Company or (ii) any product,service or business as to which the Company or any of its affiliates has actively begun preparingto develop or offer as of the date the Executive terminates employment with the Company.          (c) *Non-Solicitation*. During the Term and ending one year after the Executive’s termination ofemployment with the Company, the Executive shall not divert, solicit or lure away the patronage of(i) any client or business of the Company or any of its affiliates as of or within the two-yearperiod prior to such termination of employment or (ii) any prospective client or business of theCompany or any of its affiliates. As used herein, “prospective client” means any client that theCompany or any of its affiliates (x) is soliciting as of such termination and (y) with whom theCompany or any of its affiliates has provided a written proposal that has not been rejected by suchprospective client. Furthermore, the Executive shall not, during the Term and ending one yearafter the Executive’s termination of employment with the Company, (i) directly or indirectly,solicit or induce any employee, consultant, or other service provider of the Company or any of itsaffiliates to terminate his or her employment or other relationship with the Company or any of itsaffiliates or (ii) solicit, directly or indirectly, any person who was an employee of the Companyor any of its affiliates during the six-month period prior to the Executive’s termination ofemployment (other than a former employee of the Company who was involuntarily terminated by theCompany) to work for the Executive or any other person or entity.          (d) *Return of Materials*. Upon termination of employment, the Executive will leave with theCompany all memoranda, notes, records, manuals, or other documents and media (in whatever formmaintained, whether documentary, computer storage or otherwise) pertaining to the Company’sbusiness, including all copies thereof; other than such documents and items that are personal tothe employee (e.g., pay stubs, personal tax documentation and other compensation or employmentrelated materials).          (e) *Non-Disparagement.*Following the termination of his employment for any reason, whetherduring or after the Term, the Executive agrees to refrain from making any statement or comment,whether oral or written, of a defamatory or disparaging nature to third parties regarding theCompany, its affiliates, or their directors and officers, and the Company agrees to refrain, and touse its best efforts to cause its directors and officers to refrain, from making any statement orcomment, whether oral or written, of a defamatory or disparaging nature to third parties regardingthe Executive.
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          (f) *Cooperation.*Following the termination of his employment for any reason, whether duringor after the Term, upon reasonable request by the Company, the Executive shall cooperate with theCompany or any of its affiliates with respect to any legal or investigatory proceeding, includingany government or regulatory investigation, or any litigation or other dispute relating to anymatter in which the Executive was involved or had knowledge during his employment with the Company,subject to the reasonable demands of the Executive business endeavors and schedule. The Companyshall reimburse the Executive for all reasonable out-of-pocket costs, such as legal, travel, hoteland meal expenses, incurred by the Executive in providing any cooperation pursuant to this Section9(f).          (g) *Ownership of Executive Developments*. All copyrights, patents, trade secrets, or otherintellectual property rights associated with any ideas, concepts, techniques, inventions,processes, or works of authorship developed or created by the Executive during the course ofperforming work for the Company, or its clients, including, but not limited to, software programs,manuals, publications and reports (collectively, the “Work Product”) belongs and shall belongexclusively to the Company and shall, to the extent possible, be considered a work made by theExecutive for hire for the Company within the meaning of Title 17 of the United States Code. To theextent the Work Product may not be considered work made by the Executive for hire for the Company,the Executive agrees to assign, and automatically assign at the time of creation of the WorkProduct, without any requirement of further consideration, any right, title, or interest he mayhave in such Work Product. Upon request of the Company, the Executive shall take such furtheractions, including execution and delivery of instruments of conveyance, as may be appropriate togive full and proper effect to such assignment. Notwithstanding anything else in this Agreement,any ideas, concepts, techniques, inventions, processes or works of authorship developed or createdby the Executive on the Executive’s own time, and which have no application in the business of theCompany (“Executive Work Product”), shall not be considered Work Product, and the Company shallhave no interest in any such Executive Work Product.          (h) *Interpretation*. The Executive agrees that due to the uniqueness of his skills, abilities,and relationships and the uniqueness of the confidential information and knowledge of financingstructures that he will possess in the course of his employment with the Company, the covenants setforth above are reasonable and necessary for the protection of the Company. It is the intention ofthe Parties that the provisions of this Section 9 be enforced to the fullest extent permissibleunder the laws and policies of each jurisdiction in which enforcement may be sought, and that inthe event that any provision of this Section 9 shall, for any reason, be held invalid orunenforceable in any respect, it shall not invalidate, render unenforceable or otherwise affect anyother provision hereof, and such invalid or unenforceable provision shall be construed by limitingit so as to be valid and enforceable to the fullest extent permissible under applicable law. Ifapplicable law does not permit an invalid or unenforceable provision to be so construed, then theinvalid or unenforceable provision shall be stricken and the remaining portions of this Section 9shall be enforced to the fullest extent permitted by law. In addition, if any provision of thisSections 9 shall be determined to be invalid or unenforceable, such invalidity or unenforceabilityshall be deemed to apply only with respect to the operation of suchprovision in the particular jurisdiction in which such determination is made and not withrespect to any other provision or jurisdiction.
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          (i) *Remedies*. The Executive agrees that any breach of the terms of this Section 9 would resultin irreparable injury and damage to the Company for which the Company would have no adequate remedyat law; the Executive therefore also agrees that in the event of said breach or any threat ofbreach, the Company shall be entitled to an immediate injunction and restraining order from a courtof competent jurisdiction, without posting a bond, to prevent such breach and/or threatened breachand/or continued breach by the Executive and/or any and all persons and/or entities acting forand/or with the Executive, without having to prove damages. The availability of injunctive reliefshall be in addition to any other remedies to which the Company may be entitled at law or in equitybut remedies other than injunctive relief may only be pursued in an arbitration brought inaccordance with Section 11 of this Agreement. The terms of this paragraph shall not prevent theCompany from pursuing in an arbitration any other available remedies for any breach or threatenedbreach of this Section 9, including but not limited to the recovery of damages from the Executive.In addition, if the Company defers or withholds any payment, benefit or entitlement due to theExecutive pursuant to this Agreement or otherwise based on the Executive’s violation of anyprovision of this Agreement and it is subsequently determined that the Executive did not commitsuch breach, the Company shall promptly pay all such unpaid amounts, and shall extend such rightsor other entitlements, to the Executive as of the date that it is so determined that the Executivedid not commit such breach.     The provisions of this Section 9 shall survive any termination of this Agreement, and theexistence of any claim or cause of action by the Executive against the Company, whether predicatedon this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company ofthe covenants and agreements of this Section 9; provided, however, that this paragraph shall not,in and of itself, preclude the Executive from defending himself against the enforceability of thecovenants and agreements of this Section 9.     10. Tax Matters.          (a) If any amount, entitlement, or benefit paid or payable to the Executive or provided forhis benefit under this Agreement and under any other agreement, plan or program of the Company orany of its affiliates (such payments, entitlements and benefits referred to as a “Payment”) issubject to the excise tax imposed under Section 4999 of the Internal Revenue Code of 1986, asamended from time to time (the “Code”), or any similar federal or state law (an “Excise Tax”), thennotwithstanding anything contained in this Agreement to the contrary, to the extent that any or allPayments would be subject to the imposition of an Excise Tax, the Payments shall be reduced (butnot below zero) if and to the extent that such reduction would result in the Executive retaining alarger amount, on an after-tax basis (taking into account federal, state and local income taxes andthe imposition of the Excise Tax), than if the Executive received all of the Payments (such reducedamount is hereinafter referred to as the “Limited Payment Amount”). Unless the Executive shallhave given prior written notice specifying a different order to the Company to effectuate thelimitations described in the preceding sentence, the Company shall reduce or eliminate thePayments, by first reducing or eliminating those payments or benefits which are not payable in cashand then by reducing or eliminating cash payments, in each case in reverse order beginning withpayments or benefits which are to be paid the farthest in time from the Determination (as defined below). Any notice given by theExecutive pursuant to the preceding sentence shall take precedence over the provisions of any otherplan, arrangement or agreement, including, but not limited to, the other provisions of thisAgreement, governing the Executive’s rights and entitlements to any compensation, entitlement orbenefit.
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          (b) All calculations under this Section 10 shall be made by a nationally recognized accountingfirm designated by the Company and reasonably acceptable to the Executive (other than theaccounting firm that is regularly engaged by any party who has effectuated a change in control)(the “Accounting Firm”). The Company shall pay all fees and expenses of such Accounting Firm. TheAccounting Firm shall provide its calculations, together with detailed supporting documentation,both to the Company and the Executive within 45 days after the change in control or the date oftermination, whichever is later (or such earlier time as is requested by the Company) and, withrespect to the Limited Payment Amount, shall deliver its opinion to the Executive that he is notrequired to report any Excise Tax on his federal income tax return with respect to the LimitedPayment Amount (collectively, the “Determination”). Within 15 days of the Executive’s receipt ofthe Determination, the Executive shall have the right to dispute the Determination (the “Dispute”).The existence of the Dispute shall not in any way affect the right of the Executive to receive thePayments in accordance with the Determination. If there is no Dispute, the Determination by theAccounting Firm shall be final binding and conclusive upon the Company and the Executive (except asprovided in subsection (c) below).          (c) If, after the Payments have been made to the Executive, it is established that thePayments made to, or provided for the benefit of, the Executive exceed the limitations provided insubsection (a) above (an “Excess Payment”) or are less than such limitations (an “Underpayment”),as the case may be, then the provisions of this subsection (c) shall apply. If it is establishedpursuant to a final determination of a court or an Internal Revenue Service (the “IRS”) proceedingwhich has been finally and conclusively resolved, that an Excess Payment has been made, theExecutive shall repay the Excess Payment to the Company on demand. In the event that it isdetermined by (i) the Accounting Firm, the Company (which shall include the position taken by theCompany, or together with its consolidated group, on its federal income tax return) or the IRS,(ii) pursuant to a determination by a court, or (iii) upon the resolution to the satisfaction ofthe Executive of the Dispute, that an Underpayment has occurred, the Company shall pay an amountequal to the Underpayment to the Executive within 10 days of such determination or resolutiontogether with interest on such amount at the applicable federal short-term rate, as defined underSection 1274(d) of the Code and as in effect on the first date that such amount should have beenpaid to the Executive under this Agreement, from such date until the date that such Underpayment ismade to the Executive.     11. Successors and Assigns. This Agreement shall be binding upon and shall inure tothe benefit of the Company, its successors and assigns, provided, however, that neither thisAgreement nor any right or interest hereunder shall be assignable or transferable by the Executive,his beneficiaries or legal representatives, except by will or by the laws of descent anddistribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’slegal personal representative.
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     12. Arbitration. Except as set forth in Section 9(g) hereof, any and all disputes,claims and controversies between the Company or any of its affiliates and the Executive arising outof or relating to this Agreement, or the breach thereof, or otherwise arising out of or relating tothe Executive’s employment or the termination thereof shall be resolved by binding arbitrationbefore a single arbitrator in accordance with the Commercial Arbitration Rules of the AmericanArbitration Association. The arbitration shall take place in Westport, Connecticut. The arbitratorshall have no authority to award punitive damages. The award of the arbitrator shall be final andjudgment thereon may be entered in any court having jurisdiction. The Parties shall share the costsof the arbitrator equally, but the Parties shall pay their own legal and other expenses.     13. Notice. For the purposes of this Agreement, notices and all other communicationsprovided for in the Agreement shall be in writing and shall be deemed to have been duly given whenpersonally delivered (provided written acknowledgement of receipt is obtained) or three days afterbeing sent by certified mail, return receipt requested, postage prepaid, addressed as follows:*If to the Company*:President and Chief Executive Officer