Employee Agreement John Broderick


    EMPLOYMENT
      AGREEMENT

    


    


    This
      Employment Agreement (the “Agreement”) is made and entered into this
      1st
      day of
      January, 2005, by and between LEVEL 8 SYSTEMS, INC., a Delaware corporation
      (the
“Company”), and John P. Broderick, a resident of the New Jersey (the
“Employee”). 

    


    In
      consideration of the mutual covenants, promises and conditions set forth in
      this
      Agreement, and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties agree as
      follows:

    


    
      	
              1.

            	
              Employment.
                The Company hereby employs Employee and Employee hereby accepts such
                employment upon the terms and conditions set forth in this Agreement.
                

            


    

    


    
      	
              2.

            	
              Duties
                of Employee.
                Employee’s title will be Chief Financial Officer, Chief Operating Officer
                and Corporate Secretary and Employee will report directly to the
                President
                of the Company. Employee will be based in New Jersey, but will travel
                to
                the Cary, North Carolina office as often as the job requirements
                dictate.
                Employee agrees to perform and discharge such other duties as may
                be
                assigned to Employee from time to time by the Company to the reasonable
                satisfaction of the Company, and such duties will be consistent with
                those
                duties regularly and customarily assigned by the Company to the position
                of Chief Financial Officer and Secretary. Employee agrees to comply
                with
                all of the Company's policies, standards and regulations and to follow
                the
                instructions and directives as promulgated by the President of the
                Company. Employee will devote Employee's full professional and
                business-related time, skills and best efforts to such duties and
                will
                not, during the term of this Agreement, be engaged (whether or not
                during
                normal business hours) in any other business or professional activity,
                whether or not such activity is pursued for gain, profit or other
                pecuniary advantage, without the prior written consent of the President
                of
                the Company. This Section will not be construed to prevent Employee
                from
                (a) investing personal assets in businesses which do not compete
                with the
                Company in such form or manner that will not require any services
                on the
                part of Employee in the operation or the affairs of the companies
                in which
                such investments are made and in which Employee's participation is
                solely
                that of an investor; (b) purchasing securities in any corporation
                whose
                securities are listed on a national securities exchange or regularly
                traded in the over-the-counter market, provided that Employee at
                no time
                owns, directly or indirectly, in excess of one percent (1%) of the
                outstanding stock of any class of any such corporation engaged in
                a
                business competitive with that of the Company; or (c) participating
                in
                conferences, preparing and publishing papers or books, teaching or
                joining
                or participating in any professional associations or trade group,
                so long
                as the President of the Company approves such participation, preparation
                and publication or teaching prior to Employee’s engaging
                therein.

            


    

    


    
      	
              3.

            	
              Term.
                The term of this Agreement will be at-will, and can be terminated
                by
                either party at any time, with or without cause, subject to the provisions
                of Section 4 of this Agreement.


            


    


    
      
        
        

      

      
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              4.

            	
              Termination.

            


    

    


    
      	 	
              (a)

            	
              Termination
                by Company for Cause.
                The Company may terminate this Agreement and all of its obligations
                hereunder immediately, including the obligation to pay Employee severance,
                vacation pay or any further benefits or remuneration, if any of the
                following events occur:

            


    

    


    
      	 	
              (i)

            	
              Employee
                materially breaches any of the terms or conditions set forth in this
                Agreement and fails to cure such breach within ten (10) days after
                Employee's receipt from the Company of written notice of such breach
                (notwithstanding the foregoing, no cure period shall be applicable
                to
                breaches by Employee of Sections 6, 7 or 8 of this
                Agreement);

            


    

    


    
      	 	
              (ii)

            	
              Employee
                commits any other act materially detrimental to the business or reputation
                of the Company;

            


    

    


    
      	 	
              (iii)

            	
              Employee
                engages in dishonest or illegal activities or commits or is convicted
                of
                any crime involving fraud, deceit or moral turpitude;
                or

            


    

    


    
      	 	
              (iv)

            	
              Employee
                dies or becomes mentally or physically incapacitated or disabled
                so as to
                be unable to perform Employee's duties under this Agreement even
                with a
                reasonable accommodation. Without limiting the generality of the
                foregoing, Employee's inability adequately to perform services under
                this
                Agreement for a period of sixty (60) consecutive days will be conclusive
                evidence of such mental or physical incapacity or disability, unless
                such
                inability adequately to perform services under this Agreement is
                pursuant
                to a mental or physical incapacity or disability covered by the Family
                Medical Leave Act, in which case such sixty (60) day period shall
                be
                extended to a one hundred and twenty (120) day
                period.

            


    

    


    
      	 	
              (b)

            	
              Termination
                by Company Without Cause.
                The Company may terminate Employee's employment pursuant to this
                Agreement
                for reasons other than those stated in Section 4(a) upon at least
                thirty
                (30) days' prior written notice to Employee. In the event Employee's
                employment with the Company is terminated by the Company without
                cause,
                the Company shall be obligated to pay Employee a lump sum severance
                payment equal to six (6) months of Employee’s then base salary payable
                within thirty (30) days of the date of termination. Other than the
                severance payment set forth in this Section 4(b), Employee will be
                entitled to receive no further remuneration and will not be entitled
                to
                participate in any Company benefit programs following his termination
                by
                the Company, whether such termination is with or without
                cause.

            


    

    


    
      	 	
              (c)

            	
              Termination
                by Employee for Cause.
                In the event there occurs a Change in Control (as defined below)
                of the
                Company, Employee shall have the right
                to

            


    


    
      
        
        

      

      
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    resign
      his employment and will be entitled to a lump sum severance payment equal to
      twelve (12) months of Employee’s then base salary payable within thirty (30)
      days of the date of termination and an additional severance payment of 250,000
      shares of the Company’s common stock. The stock award will not subject to any
      customary adjustments for stock splits, stock dividends and the like undertaken
      by the Company. In addition, all Employee’s then outstanding but unvested stock
      options shall vest one hundred percent (100%). Employee shall have thirty (30)
      days from the date written notice is given to Employee about the announcement
      and closing of a transaction resulting in a Change in Control of the Company
      to
      resign or this Section 4(c) shall not apply. In the event Employee resigns
      from
      the Company for any other reason, Employee will not be entitled to receive
      or
      accrue any further Company benefits or other remuneration under this Agreement,
      and Employee specifically agrees that he will not be entitled to receive any
      severance pay.

    


    For
      purposes of this Section 4, a Change in Control shall be deemed to have occurred
      if any of the following occur:

    


    
      	 	
              (i)

            	
              the
                merger of consolidation of the Company with or into another unaffiliated
                entity, or the merger of another unaffiliated entity into the Company
                or
                another subsidiary thereof with the effect that immediately after
                such
                transaction the stockholders of the Company immediately prior to
                such
                transaction hold less than fifty percent (50%) of the total voting
                power
                of all securities generally entitled to vote in the election of directors,
                managers or trustees of the entity surviving such merger or
                consolidation;

            


    

    


    
      	 	
              (ii)

            	
              the
                sale or transfer of more than fifty-one percent (51%) of the Company’s
                then outstanding voting stock (other than a restructuring event which
                results in the continuation of the Company’s business by an affiliated
                entity) to unaffiliated person or group (as such term is used in
                Section
                13(d)(3) of the Securities Exchange Act of 1934, as amended);
                or

            


    

    


    
      	 	
              (iii)

            	
              the
                adoption by the stockholders of the Company of a plan relating to
                the
                liquidation or dissolution of the
                Company.

            


    

    


    5. Compensation
      and Benefits.
      

    


    
      	 	
              (a)

            	
              Annual
                Salary.
                During the term of this Agreement and for all services rendered by
                Employee under this Agreement, the Company will pay Employee a base
                salary
                of Two Hundred Thousand Dollars ($200,000.00) per annum in equal
                bi-monthly installments. Such annual salary will be subject to adjustments
                by any increases given in the normal course of
                business.

            


    

    


    
      	 	
              (b)

            	
              Incentive
                Compensation.
                Employee shall be eligible to receive incentive compensation in the
                form
                of a cash bonus, the amount of such cash bonus
                is

            


    


    
      
        
        

      

      
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    explained
      on Exhibit C, upon the Company reaching sales goals for the calendar year as
      set
      forth in the operating plan for the Company which was approved by the Board
      of
      Directors. Said bonus will be payable after the annual accounts have been
      presented to the Compensation Committee. Exhibit C attached hereto provides
      the
      benchmarks associated with achieving the Incentive Compensation.

    


    
      	
              6.

            	
              Vacation.
                Employee shall be eligible for four (4) weeks of paid vacation annually,
                provided that such vacation is scheduled at such times that do not
                interfere with the Company’s legitimate business
                needs.

            


    

    


    
      	
              7.

            	
              Other
                Benefits.
                Employee will be entitled to such fringe benefits as may be provided
                from
                time-to-time by the Company to its employees, including, but not
                limited
                to, group health insurance, life and disability insurance, and any
                other
                fringe benefits now or hereafter provided by the Company to its employees,
                if and when Employee meets the eligibility requirements for any such
                benefit. The Company reserves the right to change or discontinue
                any
                employee benefit plans or programs now being offered to its employees;
                provided, however, that all benefits provided for employees of the
                same
                position and status as Employee will be provided to Employee on an
                equal
                basis.

            


    

    


    
      	
              8.

            	
              Business
                Expenses.
                Employee will be reimbursed for all reasonable expenses incurred
                in the
                discharge of Employee's duties under this Agreement pursuant to the
                Company's standard reimbursement
                policies.

            


    

     

    
      	
              9.

            	
              Withholding.
                The Company will deduct and withhold from the payments made to Employee
                under this Agreement, state and federal income taxes, FICA and other
                amounts normally withheld from compensation due
                employees.

            


    

    


    
      	
              10.

            	
              Non-Disclosure
                of Proprietary Information.
                Employee recognizes and acknowledges that the Trade Secrets (as defined
                below) and Confidential Information (as defined below) of the Company
                and
                its affiliates and all physical embodiments thereof (as they may
                exist
                from time-to-time, collectively, the “Proprietary Information”) are
                valuable, special and unique assets of the Company's and its affiliates'
                businesses. Employee further acknowledges that access to such Proprietary
                Information is essential to the performance of Employee's duties
                under
                this Agreement. Therefore, in order to obtain access to such Proprietary
                Information, Employee agrees that, except with respect to those duties
                assigned to him by the Company, Employee shall hold in confidence
                all
                Proprietary Information and will not reproduce, use, distribute,
                disclose,
                publish or otherwise disseminate any Proprietary Information, in
                whole or
                in part, and will take no action causing, or fail to take any action
                necessary to prevent causing, any Proprietary Information to lose
                its
                character as Proprietary Information, nor will Employee make use
                of any
                such information for Employee's own purposes or for the benefit of
                any
                person, firm, corporation, association or other entity (except the
                Company) under any circumstances.


            


    


    
      
        
        

      

      
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    For
      purposes of this Agreement, the term “Trade Secrets” means information,
      including, but not limited to, any technical or nontechnical data, formula,
      pattern, compilation, program, device, method, technique, drawing, process,
      financial data, financial plan, product plan, list of actual or potential
      customers or suppliers, or other information similar to any of the foregoing,
      which derives economic value, actual or potential, from not being generally
      known to, and not being readily ascertainable by proper means by, other persons
      who can derive economic value from its disclosure or use. For purposes of this
      Agreement, the term “Trade Secrets” does not include information that Employee
      can show by competent proof (i) was known to Employee and reduced to writing
      prior to disclosure by the Company (but only if Employee promptly notifies
      the
      Company of Employee’s prior knowledge); (ii) was generally known to the public
      at the time the Company disclosed the information to Employee; (iii) became
      generally known to the public after disclosure by the Company through no act
      or
      omission of Employee; or (iv) was disclosed to Employee by a third party having
      a bona fide right both to possess the information and to disclose the
      information to Employee. The term “Confidential Information” means any data or
      information of the Company, other than trade secrets, which is valuable to
      the
      Company and not generally known to competitors of the Company. The provisions
      of
      this Section 6 will apply to Trade Secrets for so long as such information
      remains a trade secret and to Confidential Information during Employee’s
      employment with the Company and for a period of two (2) years following any
      termination of Employee’s employment with the Company for whatever
      reason.

    


    
      	
              11.

            	
              Non-Solicitation
                Covenants.
                Employee agrees that during Employee's employment by the Company
                and for a
                period of one (1) year following the termination of Employee's employment
                for whatever reason, Employee will not, directly or indirectly, on
                Employee's own behalf or in the service of or on behalf of any other
                individual or entity, divert, solicit or attempt to divert or solicit
                any
                individual or entity (i) who is a client of the Company at any time
                during
                the six (6)-month period prior to Employee's termination of employment
                with the Company (“Client”), or was actively sought by the Company as a
                prospective client, and (ii) with whom Employee had material contact
                while
                employed by the Company to provide similar services or products as
                such
                provided by Employee for the Company to such Clients or prospects.
                Employee further agrees and represents that during Employee's employment
                by the Company and for a period of one (1) year following any termination
                of Employee's employment for whatever reason, Employee will not,
                directly
                or indirectly, on Employee's own behalf or in the service of, or
                on behalf
                of any other individual or entity, divert, solicit or hire away,
                or
                attempt to divert, solicit or hire away, to or for any individual
                or
                entity which is engaged in providing similar services or products
                to that
                provided by the Company, any person employed by the Company for whom
                Employee had supervisory responsibility or with whom Employee had
                material
                contact while employed by the Company, whether or not such employee
                is a
                full-time employee or temporary employee of the Company, whether
                or not
                such employee is employed pursuant to written agreement and whether
                or not
                such employee is employed for a determined period or at-will. For
                purposes
                of this Agreement, “material contact” exists between Employee and a Client
                or potential Client when (1) Employee established
                

            


    


    
      
        
        

      

      
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    and/or
      nurtured the Client or potential Client; (2) the Client or potential Client
      and
      Employee interacted to further a business relationship or contract with the
      Company; (3) Employee had access to confidential information and/or marketing
      strategies or programs regarding the Client or potential Client; and/or (4)
      Employee learned of the Client or potential Client through the efforts of the
      Company providing Employee with confidential Client information, including
      but
      not limited to the Client’s identify, for purposes of furthering a business
      relationship. 

    


    
      	
              12.

            	
              Existing
                Restrictive Covenants.
                Except as provided in Exhibit B, Employee has not entered into any
                agreement with any employer or former employer (a) to keep in confidence
                any confidential information or (b) to not compete with any former
                employer. Employee represents and warrants that Employee's employment
                with
                the Company does not and will not breach any agreement which Employee
                has
                with any former employer to keep in confidence confidential information
                or
                not to compete with any such former employer. Employee will not disclose
                to the Company or use on its behalf any confidential information
                of any
                other party required to be kept confidential by
                Employee.

            


    

    


    
      	
              13.

            	
              Return
                of Proprietary Information.
                Employee acknowledges that as a result of Employee's employment with
                the
                Company, Employee may come into the possession and control of Proprietary
                Information, such as proprietary documents, drawings, specifications,
                manuals, notes, computer programs, or other proprietary material.
                Employee
                acknowledges, warrants and agrees that Employee will return to the
                Company
                all such items and any copies or excerpts thereof, and any other
                properties, files or documents obtained as a result of Employee's
                employment with the Company, immediately upon the termination of
                Employee's employment with the
                Company.

            


    

    


    
      	
              14.

            	
              Proprietary
                Rights.
                During the course of Employee's employment with the Company, Employee
                may
                make, develop or conceive of useful processes, machines, compositions
                of
                matter, computer software, algorithms, works of authorship expressing
                such
                algorithm, or any other discovery, idea, concept, document or improvement
                which relates to or is useful to the Company's Business (the
                “Inventions”), whether or not subject to copyright or patent protection,
                and which may or may not be considered Proprietary Information. Employee
                acknowledges that all such Inventions will be “works made for hire” under
                United States copyright law and will remain the sole and exclusive
                property of the Company. Employee also hereby assigns and agrees
                to assign
                to the Company, in perpetuity, all right, title and interest Employee
                may
                have in and to such Inventions, including without limitation, all
                copyrights, and the right to apply for any form of patent, utility
                model,
                industrial design or similar proprietary right recognized by any
                state,
                country or jurisdiction. Employee further agrees, at the Company's
                request
                and expense, to do all things and sign all documents or instruments
                necessary, in the opinion of the Company, to eliminate any ambiguity
                as to
                the ownership of, and rights of the Company to, such Inventions,
                including
                filing copyright and patent registrations and defending and enforcing
                in
                litigation or otherwise all such rights.


            


    


    
      
        
        

      

      
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    Employee
      will not be obligated to assign to the Company any Invention made by Employee
      while in the Company's employ which does not relate to any business or activity
      in which the Company is or may reasonably be expected to become engaged, except
      that Employee is so obligated if the same relates to or is based on
      ProprietaryInformation to which Employee will have had access during and by
      virtue of Employee's employment or which arises out of work assigned to Employee
      by the Company. Employee will not be obligated to assign any Invention which
      may
      be wholly conceived by Employee after Employee leaves the employ of the Company,
      except that Employee is so obligated if such Invention involves the utilization
      of Proprietary Information obtained while in the employ of the Company. Employee
      is not obligated to assign any Invention that relates to or would be useful
      in
      any business or activities in which the Company is engaged if such Invention
      was
      conceived and reduced to practice by Employee prior to Employee's employment
      with the Company. Employee agrees that any such Invention is set forth on
      Exhibit “A” to this Agreement.

    


    
      	
              15.

            	
              Remedies.
                Employee agrees and acknowledges that the violation of any of the
                covenants or agreements contained in Sections 10, 11 and 14 of this
                Agreement would cause irreparable injury to the Company, that the
                remedy
                at law for any such violation or threatened violation thereof would
                be
                inadequate, and that the Company will be entitled, in addition to
                any
                other remedy, to temporary and permanent injunctive or other equitable
                relief without the necessity of proving actual damages or posting
                a
                bond.

            


    

    


    
      	
              16.

            	
              Severability.
                In case one or more of the provisions contained in this Agreement
                is for
                any reason held to be invalid, illegal or unenforceable in any respect,
                the parties agree that it is their intent that the same will not
                affect
                any other provision in this Agreement, and this Agreement will be
                construed as if such invalid or illegal or unenforceable provision
                had
                never been contained herein. It is the intent of the parties that
                this
                Agreement be enforced to the maximum extent permitted by
                law.

            


    

    


    
      	
              17.

            	
              Entire
                Agreement.
                This Agreement embodies the entire agreement of the parties relating
                to
                the subject matter of this Agreement and supersedes all prior agreements,
                oral or written, regarding the subject matter hereof. No amendment
                or
                modification of this Agreement will be valid or binding upon the
                parties
                unless made in writing and signed by the
                parties.

            


    

    


    
      	
              18.

            	
              Governing
                Law.
                This Agreement is entered into and will be interpreted and enforced
                pursuant to the laws of the State of New Jersey. The parties hereto
                hereby
                agree that the appropriate forum and venue for any disputes between
                any of
                the parties hereto arising out of this Agreement shall be any federal
                court in the state where the Employee has his principal place of
                residence
                and each of the parties hereto hereby submits to the personal jurisdiction
                of any such court. The foregoing shall not limit the rights of any
                party
                to obtain execution of judgment in any other jurisdiction. The parties
                further agree, to the extent permitted by law, that a final and
                unappealable judgment against either of them in any action or proceeding
                contemplated above shall be conclusive and may be enforced in
                

            


    


    
      
        
        

      

      
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    any
      other
      jurisdiction within or outside the United States by suit on the judgment, a
      certified exemplified copy of which shall be conclusive evidence of the fact
      and
      amount of such judgment.

    


    
      	
              19.

            	
              Surviving
                Terms.
                Sections 4, 10, 11, 14, 15 and 18 of this Agreement shall survive
                termination of this Agreement.

            


    

    


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

    


    COMPANY:      EMPLOYEE:

    


    LEVEL
      8
      SYSTEMS, INC.

    


    


    


    By:
      ____________________________  _______________________________

    Name:       John
      P.
      Broderick

    Title:
           


    
      
        
        

      

      
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    EXHIBIT
      A

    


    INVENTIONS

    


    


    


    


    


    


    Employee
      represents that there are no Inventions.

    


    


    


    _________________

    Employee
      Initials

    



    
      
        
        

      

      
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    EXHIBIT
      B

    


    EXISTING
      RESTRICTIVE COVENANTS

    


    



    
      
        
        

      

      
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    EXHIBIT
      C

    


    VARIABLE
      COMPENSATION

    


    


    


    


    


    
      	 	
              Revenue
                Range 

            	 	 	 	 	 
	 	 	 	 	 	 	 	 
	 	
              From

            	
              To

            	 	
              Variable
                Compensation

            	 
	 	 	 	 	 	 	 	 
	
              Tier
                1

            	
              $
                6,000,000 

            	
              $
                8,499,999 

            	 	 	
              $
                50,000 

            	 	 
	
              Tier
                2

            	
              $
                8,500,000 

            	
              $
                12,499,999 

            	 	 	
              $
                75,000 

            	 	 
	
              Tier
                3

            	
              $
                12,500,000 

            	 	 	 	
              $
                100,000 

            	 	 
	 	 	 	 	 	 	 	 
	 	
              Performance
                significantly in excess of Tier 3 will achieve an addition reward
                at the
                

            	 
	 	
              discretion
                of the Compensation Committee