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                                                                    EXHIBIT 10.3

                         FOUNDERS' EMPLOYMENT AGREEMENT


         THIS EMPLOYMENT AGREEMENT ("Agreement"), dated as of October ______,
2002, is by and between Patron Systems, Inc., a Delaware corporation ("Company")
and Brett Newbold ("Executive").

         WHEREAS, the Executive is currently serving as the President of the
Software Products Division of the Company; and

         WHEREAS, the parties desire to enter into this Agreement setting forth
the terms and conditions for the employment relationship of the Executive with
the Company.

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

         1. Employment. From October 1, 2002 through the Term (defined below),
the Executive is employed as the President of the Software Products Division of
the Company and of any subsidiary or other affiliate that it may require. The
Executive shall render executive, policy and other management services to the
Company and its subsidiaries/affiliates of the type customarily performed by
persons serving in similar executive officer capacities. The Executive shall
devote substantially all of his working time and his best efforts to the Company
and his position, which shall include such duties as the Board of Directors of
the Company ("Board") or the Chairman of the Board and Chief Executive Officer
of the Company may from time to time reasonably direct that are reasonably
consistent with the Executive's education, experience and background. During the
Term, there shall be no material increase or decrease in the duties and
responsibilities of the Executive otherwise than as provided herein, unless the
parties otherwise agree in writing.

         2. Compensation.

            (a) Salary. The Company agrees to pay the Executive a minimum base
salary of $300,000 per annum, less applicable taxes and withholdings for the
first year of the Term; $350,000 per annum, less applicable taxes and
withholdings for the second year of the Term; and $400,000 per annum, less
applicable taxes and withholdings for the third year of the Term. The salary
under this Section 2(a) shall be payable to the Executive not less frequently
than monthly. The Executive shall not be entitled to receive additional
compensation for serving as a director of the Company or of any subsidiary or
affiliate of the Company or for serving as a member of any such board of
directors.

            (b) Annual Bonus. In addition to his salary under Section 2(a)
above, during the Term, the Company may pay to the Executive an annual bonus of
50-100 percent of his salary under such subsection, subject to financial
performance criteria as established by the Board of Directors' Compensation
Committee ("Compensation Committee"), in its sole discretion ("Annual Bonus").
The Annual Bonus shall be payable in April following each calendar year during
the Term and shall be prorated for any partial years.




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         3. Discretionary and Performance Incentive Bonuses. During the Term,
the Executive shall be entitled to participate in an equitable manner with all
other Executive Employees in such discretionary bonuses as may be authorized,
declared and paid by the Compensation Committee to its Executive Employees. The
term "Executive Employee" includes the Chairman of the Board/Chief Executive
Officer, the President of the Software Products Division, and the President of
the Services Division. The Company may adopt an incentive bonus plan providing
for the payment of annual performance incentive bonuses to the Executive and
other Executive Employees based upon the increase in the Company's operating
profit or other appropriate performance objectives. No other compensation
provided for in this Agreement shall be deemed a substitute for the Executive's
right to participate in such bonuses.

         4. Insurance, Retirement and Employee Benefit Plans, Fringe Benefits;
Business Expenses.

            (a) Other Benefits and Perquisites. During the Term, the Executive
shall be entitled to participate in an equitable manner in any plan of the
Company relating to stock options, restricted stock, employee stock purchase or
ownership, pension, thrift, profit sharing, group life insurance, medical
coverage, education or other retirement or employee benefit plans or
arrangements that the Company has adopted or may adopt for the benefit of its
employees or Executive Employees. The Executive shall also be entitled to
participate in, or enjoy the benefit of, any other fringe benefits or
perquisites that are now or may be or become applicable to the Company's
Executive Employees. The Company reserves the right to modify or terminate any
such benefit at any time.

            (b) Business Expenses. During the Term, the Company shall promptly
reimburse the Executive for all reasonable and customary expenses incurred by
the Executive in performing services for the Company, including all expenses of
travel and living expenses while away from home on business or at the request of
and in the service of the Company, provided that such expenses are incurred and
accounted for in accordance with the policies and procedures established by the
Company.

         5. Term. The initial term of employment under this Agreement shall be
from October 1, 2002 until the third anniversary of such date ("Term") unless
the Executive's employment terminates earlier pursuant to Section 7 below. Upon
expiration of the Term, the term of employment may be renewed upon written
agreement of the parties.

         6. Vacations. The Executive shall be entitled to an annual paid
vacation of at least six weeks per year or such longer period as the Board may
approve. The timing of paid vacations shall be scheduled in a reasonable manner
by the Executive.

         7. Termination of Employment. The Executive's employment may be
terminated under the following circumstances:

            (a) Expiration of Term. The Executive's employment will terminate if
the Term provided for under Section 5 expires without written agreement of both
parties to renew the Term.

            (b) Death. The Executive's employment shall terminate upon his
death.

            (c) Incapacity. If the Executive is unable to perform his duties
under this Agreement for medical reasons for a continuous period of six months,
even with reasonable accommodation, the Executive will be deemed to have
terminated his employment.

            (d) Termination of Employment by the Company. The Company may
terminate the Executive's employment at any time with or without Cause; provided
that the Executive may be terminated for Cause under Sections 7(d)(1) or (4)
only if the Company has given the Executive notice of such failure or breach,
stating that such failure or breach will be grounds for termination for Cause,
if the Executive fails to cure such failure or breach within 30 days following
receipt of such written notice. For all purposes under this Agreement, "Cause"
shall mean:





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             (1) the willful failure by the Executive to substantially perform
         his duties hereunder (other than any such failure resulting from the
         Executive's inability to perform such duties as a result of physical or
         mental illness or incapacity);

             (2) an act or omission by the Executive that constitutes gross
         misconduct, moral turpitude or fraud;

             (3) willful misconduct by the Executive that causes substantial
         and material injury to the business and operations of the Company, the
         continuation of which, in the reasonable judgment of the Board, will
         continue to substantially and materially injure the business and
         operations of the Company in the future;

             (4) a material breach of any duty owed to the Company, including
         but not limited to the duties of loyalty and confidentiality; or

             (5) a conviction of, or a plea of "guilty" or "no contest" to, a
         felony.

No act or failure to act shall be considered "willful" for this purpose unless
done, or omitted to be done, by the Executive other than in good faith and other
than with a reasonable belief that his action or omission was in the best
interests of the Company. The Executive shall not be deemed to have been
terminated for Cause unless the Executive shall have been provided with a Notice
of Termination as defined in Section 7(f).

            (e) Termination by the Executive.

                (1) The Executive may terminate his employment (A) for Good
         Reason, provided that he may resign with Good Reason only if he
         provides notice of such reason for resignation to the Company stating
         that such reason will be grounds for resignation with Good Reason, if
         the Company fails to cure such reason within 30 days following receipt
         of such notice or (B) for any other reason by giving 120 days prior
         written notice to the Company. The Company may, in its sole discretion,
         terminate the Executive's employment at any time during the 120 day
         notice period, provided it pays the Executive the equivalent of the
         Executive's salary for the remainder of the notice period.

                (2) For this purpose, "Good Reason" shall mean (A) the
         assignment to the Executive of any duties inconsistent with the
         Executive's status as the President of the Software Products Division
         of the Company or any substantial adverse alteration in the nature or
         status of the Executive's responsibilities; (B) any change in the
         Executive's reporting responsibility such that the Executive is
         required to report other than exclusively to the Chairman of the
         Board/Chief Executive Officer; (C) any purported termination of the
         Executive's employment by the Company that is not effected pursuant to
         a Notice of Termination satisfying the requirements of Section 7(f)
         hereof, or (D) any other failure by the Company to comply with any
         material provisions of this Agreement which failure continues for more
         than ten (10) days after written notice of such noncompliance from the
         Executive.

            (f) Notice of Termination. Any termination of the Executive's
employment by the Company or by the Executive (other than termination pursuant
to Section 7(b) or 7(c) hereof) shall be communicated to the other party by a
written Notice of Termination. Any Notice of Termination given by a party shall
specify the particular termination provision of this Agreement relied upon by
such party and shall set forth in reasonable detail the facts and circumstances
relied upon as providing a basis for the termination under the provision so
specified. If the Company terminates the Executive's employment, the written
Notice of Termination must be communicated to the Executive by the Board.

             (g) Termination Date. The Termination Date shall mean (1) if the
Term ends, the last day of the Term; (2) if the Executive's employment is
terminated by his death, the date of his death; (3) if the Executive's
employment is terminated by Incapacity, the date six months after the Executive
first becomes incapacitated; (4) if the Executive resigns for Good Reason, 30
days following the Company's receipt of the Executive's Notice of




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Termination, if the Company fails to cure; (5) if the Executive resigns without
Good Reason, 120 days after he provides written notice to the Company of such
resignation; (6) if the Executive's employment is terminated by the Company for
Cause, the date specified in the Notice of Termination; or (7) if the
Executive's employment is terminated without Cause, sixty (60) days following
the date on which the Notice of Termination is given. The Company may, in its
sole discretion, terminate the Executive's employment at any time during any of
the notice periods specified in this section, provided it pays the Executive the
equivalent of the Executive's salary for the remainder of the notice period.

         8. Compensation Upon Termination of Employment.

            (a) Termination because of Death. If the Executive dies during the
Term, the Company shall pay to the Executive his salary through the Termination
Date, his accrued, unused vacation and a pro rata portion of the amount of the
Annual Bonus that the Executive received for the calendar year prior to the
calendar year in which the Termination Date occurs, which shall be paid on the
Company's normal bonus payment schedule. If the Executive dies prior to January
1, 2003, the Annual Bonus for the first calendar year shall be deemed to be 50
percent of the Executive's salary at the time of the Executive's death. The
Company shall have no further obligation to the Executive hereunder.

            (b) Expiration of Term. If the Term expires without renewal:

                (1) The Company shall pay the Executive his salary through the
         Termination Date and a pro rata portion of the Annual Bonus (based upon
         the bonus paid for the calendar year prior to the calendar year in
         which the Termination Date occurs) and all other accrued but unpaid
         amounts to which the Executive is entitled as of the Termination Date,
         including, without limitation, any pro rata performance incentive bonus
         and all accrued, unused vacation time; and

                (2) In exchange for the release provided for in Section 8(e)(2),
         the Company shall pay the Executive the benefits set forth in Sections
         8(e)(2) and (3), except that for purposes of this Section, the payments
         provided for in Section 8(e)(2)(i) shall be for two (2) years, not
         three (3) years.

            (c) Termination for Cause or Resignation Without Good Reason. If
during the Term the Executive's employment is terminated by the Company for
Cause or by the Executive other than for Good Reason, the Company shall pay to
the Executive his salary through the Termination Date. The Company shall have no
further obligation to the Executive hereunder.

            (d) Termination because of Incapacity. If during the Term the
Executive's employment is terminated by the Company because of Incapacity under
Section 7(c) hereof, the Company shall pay the Executive an annual disability
benefit equal to the amount by which (1) the sum of 60 percent of his salary at
the rate in effect under Section 2(a) hereof on the Termination Date and 60
percent of the bonus amount specified in Section 2(b) hereof (based upon the
bonus paid for the calendar year prior to the calendar year in which the
Termination Date occurs) exceeds (2) the amount of the long term disability
benefit that is payable to the Executive under any policy of disability
insurance provided for the Executive by the Company at its expense. The
disability benefit shall be paid for such period as is determined by the Board
for Executive Employees but shall not be less than three (3) years from the
Termination Date.

            (e) Termination without Cause or with Good Reason. If during the
Term the Company terminates the Executive's employment without Cause or the
Executive terminates his employment for Good Reason, then:

                (1) The Company shall pay the Executive his salary through the
         Termination Date and a pro rata portion of the Annual Bonus (based upon
         the bonus paid for the calendar year prior to the calendar year in
         which the Termination Date occurs) and all other accrued but unpaid
         amounts to which the Executive is entitled as of the Termination Date,
         including, without limitation, any pro rata performance incentive bonus
         and all accrued, unused vacation time. If the Executive's employment is
         terminated



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         without Cause or he resigns with Good Reason prior to January 1, 2003,
         the Annual Bonus for the first calendar year shall be deemed to be 50
         percent of the Executive's salary at the time of the Termination Date;

                (2) If within forty-five (45) days of the Executive's
         Termination Date the Executive signs a release of any and all claims in
         the form provided by the Company, the Company will pay the Executive,
         less applicable taxes and withholdings: (i) the Executive's then
         current salary, plus an additional ten (10) percent, for three (3)
         years; (ii) an amount equal to the Executive's Annual Bonus (based upon
         the bonus paid for the calendar year prior to the calendar year in
         which the Termination Date occurs) for each of the years during which
         the Executive receives payments under Section 8(e)(2)(i); and (iii) the
         maximum bonus amount that could have been paid to the Executive under
         any performance incentive bonus plan that the Compensation Committee
         has established under Section 3 for the year in which the Termination
         Date occurs. If the Executive's employment is terminated without Cause
         or he resigns with Good Reason prior to January 1, 2003, the Annual
         Bonus for the first calendar year shall be deemed to be 50 percent of
         the Executive's salary at the time of the Termination Date. The
         payments under Section 8(e)(2) shall be paid on the same schedule as if
         the Executive were still employed by the Company. No payments under
         Section 8(e)(2) shall be made until the later of (a) the first pay
         period following the Executive's Termination Date or (b) ten (10) days
         after the Executive delivers the signed release to the Company.

                (3) In addition to the payments provided for in Section 8(e)(2),
         and in exchange for the release referenced in Section 8(e)(2):

                    (i) the Executive shall be continued on the Company's health
         insurance plan for the remainder of the Term, unless such continuation
         is not permissible under the terms of the health insurance coverage. In
         the event such coverage is not permissible, the Company will pay the
         Executive's COBRA premiums (at the level of coverage the Executive had
         prior to the Termination Date) if the Executive elects and is eligible
         for such coverage. In the event that the Executive obtains COBRA
         coverage and that coverage terminates prior to the end of the Term and
         the Executive has not obtained other employment, the Company will pay
         the reasonable cost of the Executive's health insurance coverage (at
         the level of coverage the Executive had prior to the Termination Date)
         from the end of the COBRA coverage period to the end of the Term; and

                    (ii) all insurance or other provisions for indemnification,
         defense or hold-harmless of officers or directors of the Company that
         are in effect on the date the Notice of Termination is sent to the
         Executive, or on the date the Executive's resignation for Good Reason
         becomes effective (as applicable), shall continue for the benefit of
         the Executive with respect to all of his acts and omissions while an
         officer or director as fully and completely as if such termination had
         not occurred, and until the final expiration or running of all periods
         of limitation against action which may be applicable to such acts or
         omissions.

                (4) The severance payments provided for in Section 8(e)(2)
         shall not be reduced by any compensation or benefits that the Executive
         may receive for other employment with another employer or through
         self-employment after termination of employment with the Company.

            (f) Cost of Enforcement. In the event the employment of the
Executive is terminated by the Company because of Incapacity or without Cause,
or by the Executive for Good Reason, and the Company fails to make timely
payment of the amounts owed to the Executive under this Agreement, the Executive
shall be entitled to reimbursement for all reasonable costs, including
attorney's fees, incurred by the Executive in taking action to collect such
amounts or otherwise to enforce this Agreement, plus interest on such amounts at
the rate of one percent above the prime rate (defined as the base rate on
corporate loans at large U.S. money center commercial banks as published by The
Wall Street Journal), compounded monthly, for the period from the Termination
Date until payment is made to the Executive. Such reimbursement and interest
shall be in addition to all rights to which the Executive is otherwise entitled
under this Agreement.




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            (g) Parachute Payment Gross-Up. In the event it shall be determined
that any payment or distribution by the Company or its affiliated companies to
or for the benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
8(g)) (a "Payment"), would be subject to the excise tax imposed by Section 4999
of the Internal Revenue Code of 1986, as amended, or any interest or penalties
are incurred by the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Executive shall be entitled to
receive within 10 days following such determination or such incurrence, as the
case may be, an additional payment (a "Gross-Up Payment") in an amount such that
after payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments. All
determinations to be made pursuant to this Section 8(g), including whether and
when a Gross-Up Payment is required, the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determinations, shall be made by
the Company's public accounting firm upon the request of the Company or the
Executive. All fees and expenses of such public accounting firm shall be borne
by the Company.

         9. Confidentiality. In consideration of the willingness of the Company
to employ the Executive and the compensation to be paid and benefits to be
received therefore, and for other good and valuable consideration, the receipt
and adequacy of which is hereby acknowledged, the Executive agrees as follows:

            (a) The Company Owns All of the Executive's Work. All improvements,
discoveries, inventions, designs, documents, literary works (including but not
limited to books, articles and white papers), licenses and patents, or other
data devised, conceived, made, developed, obtained, filed, perfected, acquired,
or first reduced to practice, in whole or in part, or in the regular course of
employment by the Executive during the period of the Executive's employment, and
related in any way to the business, including development and research, of the
Company or any subsidiary or affiliate engaged in business substantially similar
to that of the Company shall be promptly disclosed to the Company (collectively,
"Works"). The Executive hereby assigns and transfers to the Company all of his
right, interest and title thereto, and such Works shall become the property of
the Company. During the Term and at any time thereafter, upon request of the
Company, the Executive will join and render assistance in any proceedings and
execute any papers necessary to file and prosecute applications for, and to
acquire, maintain and enforce, letters, patent trademarks, registrations and/or
copyrights, both domestic and foreign, with respect to such improvements,
discoveries, inventions, designs, documents, licenses and patents, or other data
as required for vesting and maintaining title to same in the Company. This
Section 9(a) does not apply to Works when all of the following criteria are met:
(i) no equipment, supplies, facilities, or Confidential and Proprietary
Information of the Company was used in developing the Works or in applying for
or obtaining a patent or copyright; (ii) the Work was developed entirely on the
Executive's own time; (iii) the Work does not relate directly to the business of
the Company or to the Company's actual or demonstrably anticipated research or
development; and (d) the Work does not result from any work performed by the
Executive for the Company or at the request of the Company.

             (b) Non-Disclosure of Confidential Information. The Executive
agrees and acknowledges that the term "Confidential and Proprietary Information"
shall mean any and all information which the Executive learns as a result of his
employment with the Company and which is not in the public domain, in any form,
emanating from or relating to the Company and its subsidiaries and affiliates,
including, but not limited to, trade secrets, technical information, costs,
designs, drawings, processes, systems, methods of operation and procedures,
formulae, test data, know-how, improvements, price lists, financial data, code
books, invoices and other financial statements, computer programs, discs and
printouts, sketches, and plans (engineering, architectural or otherwise),
employees' and consultants' benefits, perquisites, salaries, stock options,
compensation, formulas or bonuses, and their non-business addresses and
telephone numbers, organizational structure and reporting relationships,
customer lists, telephone numbers, names, addresses, information about equipment
and processes (including specifications and operating manuals), or any other
compilation of information written or unwritten that is used in the business of
the Company or any subsidiary or affiliate that gives the Company or any
subsidiary or affiliate any opportunity to obtain an advantage over competitors
of the Company who do not know or use such information. The Executive agrees and
acknowledges that all Confidential and Proprietary Information, in any form, and
all copies and extracts




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thereof, is and are and shall remain the sole and exclusive property of the
Company and, upon termination of his employment with the Company, the Executive
hereby agrees to return to the Company the originals and all copies of any
Confidential and Proprietary Information provided to or acquired by the
Executive during the period of his employment. Except as ordered by a court of
competent jurisdiction, the Executive expressly agrees never to disclose to any
person (except to other Company employees, and then only on a "need to know"
basis) or entity any Confidential and Proprietary Information either during the
Term or at any time after termination of his employment, except with the express
written authorization and consent of the Company.

             (c) Customer's Information. The Executive understands and
acknowledges that each customer of the Company or its subsidiaries or affiliates
may disclose information that will be within the Company's control in connection
with the Company's furnishing of services to its customer. The Executive
covenants and agrees to hold such information in the strictest confidence and
shall treat such information in the same manner and be obligated by the
provisions of this Agreement as if such information were Confidential and
Proprietary Information, as defined in Section 9(b) hereof.

         10. Covenant Not to Compete. During the Executive's employment and for
a period of two (2) years after the termination of the Executive's employment
for any reason (except that the period shall be three (3) years if the Executive
is receiving benefits under Section 8(e)), the Executive shall not directly or
indirectly own, manage, operate, control or be employed by or participate in the
ownership, management, operation or control of any business that is engaged in
an information security business (including the development, marketing and sale
of information security-related software, professional services, technology or
products) within the geographical area in which, as of the Termination Date, the
Company is actively marketing or has made a significant investment in time and
money to prepare to market its products or services within the six (6) month
period after the Termination Date. The Executive shall not, during the Term,
have any other paid employment other than with a subsidiary or affiliate of the
Company, except with the prior approval of the Board.

         11. Non-Solicitation. During the Executive's employment and for a
period of two (2) years following the termination of the Executive's employment
for any reason (except that the period shall be three (3) years if the Executive
is receiving benefits under Section 8(e)) ("Restricted Period") the Executive
will not, except with prior written approval of the Board, directly or
indirectly, individually or as part of or on behalf of any other person,
company, employer or other entity:

             (a) hire or attempt to solicit for hire, or encourage to end their
relationship with the Company, any persons who have been employed by the Company
at any time within the three (3) months prior to such action ("Covered
Employee"). If during the Restricted Period any Covered Employee accepts
employment with any person, company, employer or other entity of which the
Executive is an officer, director, employee, partner, shareholder (other than of
less than 5% of the stock in a publicly traded company) or joint venture, it
will be presumed that the Covered Employee was hired in violation of this
provision ("Presumption"). This Presumption may only be overcome by the
Executive showing by a preponderance of the evidence that the Executive was not
directly or indirectly involved in hiring, soliciting or encouraging the Covered
Employee to leave employment with the Company;

             (b) sell or otherwise provide, or solicit for the purposes of
selling or otherwise providing, information security-related services or
products that are similar or related to those sold by the Company as of the
Termination Date to any person or entity that has within the twelve (12) months
preceding the Termination Date purchased any such services or products from the
Company and with whom the Executive had direct contact on behalf of the Company
during that time.

         12. Amendments or Additions: Action by Board. No amendments or
additions to the Agreement shall be binding unless in writing and signed by all
parties hereto. The prior approval by a majority affirmative vote of the full
Board shall be required in order for the Company to authorize any amendments or
additions to this Agreement, to give any consents or waivers of provisions of
this Agreement, or to take any other action under this Agreement including any
Notice of Termination.



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         13. Miscellaneous.

             (a) Notices. Any notice required or permitted hereunder shall be
given in writing and shall be personally delivered or mailed by first class
registered or certified mail, postage prepaid, return-receipt-requested, or
transmitted by facsimile. If notice is to be sent to the Company, it will be
sent to:

Mr. Patrick J. Allin
Chairman of the Board and Chief Executive Officer
Patron Systems, Inc.
311 Belle Foret Drive
Lake Bluff, IL  60044
Fax: (847) 295-7335

If notice is to be sent to the Executive, it will be sent to:

Mr. Brett Newbold
3488 Ward Road
Cambridge, Idaho  83610

Each notice or communication that shall have been transmitted in the manner
described above, or that shall have been delivered to a telegraph company, shall
be deemed sufficiently given, served, sent or received at such time as it is
sent to the addressee (with the return receipt, delivery receipt or (with
respect to a telex) the answer back being deemed conclusive, but not exclusive,
evidence of such sending) or at such time as delivery is refused by the
addressee upon presentation.

             (b) Severability. Nothing in this Agreement shall be construed so
as to require the commission of any act contrary to law and wherever there is
any conflict between any provision of this Agreement and any law, statute,
ordinance, order or regulation, the latter shall prevail, but in such event any
necessary action will be taken to bring it within applicable legal requirements.
If any provision of this Agreement should be held invalid or unenforceable, the
remaining provisions shall be unaffected by such a holding.

             (c) Dispute Resolution. The Executive and the Company
agree that any dispute between the Executive and the Company will be finally
resolved by binding arbitration in accordance with the Federal Arbitration Act
("FAA"). The Executive and the Company agree to follow the Dispute Resolution
Procedures set forth in Attachment A to this Agreement.

             (d) Complete Agreement. This Agreement, including the attachment
hereto, contains the entire agreement and understanding between the parties
relating to the subject matter hereof, and supersedes any prior understandings,
agreements or representations by or between the parties, written or oral,
relating to the subject matter hereof.

             (e) Successors or Assigns. This Agreement and the rights and
obligations of the parties hereto shall bind and inure to the benefit of any
successor or successors of the Company by way of reorganization, merger,
consolidation or similar event and any assignee of all or substantially all of
its business assets, but except as to any such successor or assignee of the
Company, neither this Agreement nor any rights or benefits hereunder may be
assigned by the Company or the Executive. Notwithstanding the foregoing, in the
event of the death of the Executive all rights to receive payments hereunder
shall become rights of the Executive's estate.

             (f) Section Headings. The section headings used in this Agreement
are included solely for convenience and shall not affect, or be used in
connection with, the interpretation of this Agreement.

             (g) Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State where the Executive is employed without
regard to principles of conflict of laws.



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         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the day and year first above written.


         PATRON SYSTEMS, INC.                EXECUTIVE


         By:
            -------------------------           --------------------------




















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                                  ATTACHMENT A

                          DISPUTE RESOLUTION PROCEDURES

The parties agree to make a good faith effort to informally resolve any dispute
before submitting the dispute to arbitration in accordance with the following
procedures:


A.       The party claiming to be aggrieved shall furnish to the other a written
         statement of the grievance, all persons whose testimony would support
         the grievance, and the relief requested or proposed. The written
         statement must be delivered to the other party within the time limits
         for bringing an administrative or court action based on that claim.

B.       If the other party does not agree to furnish the relief requested or
         proposed, or otherwise does not satisfy the demand of the party
         claiming to be aggrieved within 30 days and the aggrieved party wishes
         to pursue the issue, the aggrieved party shall by written notice demand
         that the dispute be submitted to non-binding mediation before a
         mediator jointly selected by the parties. The Company will pay the
         mediator's fee.

C.       If mediation does not produce a resolution of the dispute and either
         party wishes to pursue the issue, that party shall request arbitration
         of the dispute by giving written notice to the other party within 30
         days after mediation. The parties will attempt to agree on a mutually
         acceptable arbitrator and, if no agreement is reached, the parties will
         request a list of nine arbitrators from the American Arbitration
         Association and select by alternately striking names. The arbitration
         will be conducted consistent with the American Arbitration
         Association's National Rules for Resolution of Employment Disputes
         ("Rules") that are in effect at the time of the arbitration. If there
         is any conflict between those Rules and the terms of the Employment
         Agreement ("Agreement"), including all attachments thereto, the
         Agreement will govern. The arbitrator shall have authority to decide
         whether the conduct complained of under Subsection (a) above violates
         the legal rights of the parties. In any such arbitration proceeding,
         any hearing must be transcribed by a certified court reporter and any
         decision must be supported by written findings of fact and conclusions
         of law. The arbitrator's findings of fact must be supported by
         substantial evidence on the record as a whole and the conclusions of
         law and any remedy must be provided for by and consistent with the laws
         of the State where the Executive is employed and federal law. The
         arbitrator shall have no authority to add to, modify, change or
         disregard any lawful term of the Agreement. The Company will pay the
         arbitrator's fee.

D.       Arbitration shall be the exclusive means for final resolution of any
         dispute between the parties, except 1) for workers' compensation and
         unemployment claims and 2) when injunctive relief is necessary to
         preserve the status quo or to prevent irreparable injury, including but
         not limited to an alleged or threatened breach of Sections 9-11 of the
         Agreement. Injunctive relief may be sought from any court of competent
         jurisdiction located in the State where the Executive is employed.





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