EXHIBIT 10.103


 


MEADE
INSTRUMENTS CORP.


 


EXECUTIVE RETENTION AGREEMENT


 





















 


EXECUTIVE
RETENTION AGREEMENT


 


This Executive Retention Agreement (“Agreement”) is entered into as of January 10,
2008, by and between Meade Instruments Corp. (sometimes hereinafter referred to
as the “Company”) and Paul Ross (“Executive”).


 


WHEREAS, the Company desires to provide Executive with assurances,
conditioned as set forth herein both to allow him to maintain his focus on
making decisions that are in the best overall interests of the Company and the
resulting successor organization in the event that a Major Transaction (as
defined below) takes place, and to alleviate concerns about job security in the
event of a Major Transaction.


 


NOW, THEREFORE, BE IT RESOLVED, the parties agree as follows:


 


Section 1.                                            Definitions


 


(a)                                  “Affiliate” shall mean any corporation or
other business entity which is part of a continuous chain of ownership with the
Company as the ultimate parent organization, provided that the stock or
equivalent ownership interest at each level from the Company to the Affiliate
is not less than fifty percent (50%) of either the total combined voting power
of all classes of stock or other interest entitled to vote or the value of all
classes of ownership in the entity at issue.


 


(b)                                 “Agreement Administrator” shall mean the
Compensation Committee.


 


(c)                                  “Buyer” shall mean a third party (that
is, a person or entity that is not an Affiliate of the Company) that is,
directly or indirectly, the acquirer of, result of, or successor to the
Company.


 


(d)                                 “Cause” shall have the same definition as
is set forth in the Employment Agreement.


 


(e)                                  “Closing Date of a Major Transaction”
shall mean the closing date of any single transaction constituting a Major
Transaction on its own, or the closing date of the last transaction in a series
of transactions that taken together constitute a Major Transaction.


 


(f)                                    “Code” shall mean the Internal Revenue
Code of 1986, as amended from time to time.


 


(g)                                 “Compensation Committee” shall mean the
Compensation Committee of the Board of Directors of the Company.


 


(h)                                 “Disability” shall have the same
definition as is set forth in the Employment Agreement.


 


(i)                                     “Division” shall mean each of the
following:


 


(i)            a
Subsidiary of the Company; or


 


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(ii)           any
operating unit of the Company, including, without limitation, Meade high-end,
Meade low-end, Simmons, Weaver, Redfield, Bresser, Coronado, and Kodak.


 


(j)                                     “Employment Agreement” shall mean that
certain Employment Agreement entered into by and between Executive and the
Company, dated as of July 13, 2007, as such Employment Agreement may be
amended from time-to-time by mutual agreement of the Company and Executive.


 


(k)                                  “ERISA” shall mean the Employee Retirement
Income Security Act of 1974, as amended from time to time.


 


(l)                                     “Executive Percentage” shall mean 25%.


 


(m)                               “Exchange Act” shall mean the Securities
Exchange Act of 1934, as amended from time to time.


 


(n)                                 “Good Reason” shall have the same
definition as is set forth in the Employment Agreement; provided, however, that
in order to effect a Separation from Service hereunder for Good Reason,
Executive must provide written Notice to the Company of the existence of any
condition that constitutes Good Reason within sixty (60) days after the initial
existence of the facts and circumstances giving rise to Executive’s Notice of
Good Reason.  The Company shall have
thirty (30) days (the “Cure Period”) from its receipt of Executive’s written
Notice of Good Reason to remedy the condition. 
If the Company fails to remedy the condition during the Cure Period,
then Executive may effect a Separation from Service for Good Reason from the
Company.


 


Executive’s right to effect a Separation from Service for Good Reason
shall not be affected by Executive’s temporary incapacity due to a physical or
mental/psychological condition.  However,
a Disability will not qualify as Good Reason unless accompanied by one or more
conditions that constitute Good Reason herein. 
A termination by Executive for Good Reason shall not be considered to be
a voluntary resignation.


 


(o)                                 “Major Transaction” of the Company shall
mean any of the following, whether occurring in one or more transactions taking
place during the Term:


 


(i)            the
sale of 75% or more of the revenue generating assets of the Company (to be
determined in good faith by the Board of Directors of the Company as any assets
or combination of assets utilized in connection with the manufacturing,
distribution, marketing or sale of the products and/or services of the Company;
for example, brand names, facilities, or any Division of the Company), whether
such sale of 75% or more of the revenue generating assets occurs in a single
transaction or in a series of transactions during the Term; or


 


(ii)           the
acquisition, directly or indirectly, by any person or group of persons (other
than the Company or a corporation controlled by the Company) of beneficial
ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
securities possessing more than 75% of the total combined voting power of the
Company’s outstanding securities pursuant to a tender or exchange offer or
otherwise; or


 


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(iii)          a
reorganization, merger or consolidation under which the stockholders of the
Company immediately prior to the reorganization, merger or consolidation own
less than fifty percent (50%) of the voting securities of the surviving or
resulting corporation as a result of such transaction.


 


(p)                                 “Notice” shall mean any notice required
under the Agreement, which notice shall be in writing.  Notice hereunder shall be deemed to have been
given when delivered in person to the Company or Executive; or actually
received by the Company or Executive after being transmitted by facsimile (“fax”)
to the Company or Executive; or, deposited in the United States mail, certified
or registered, postage prepaid, return receipt requested, addressed to the
Company or Executive at their respective addresses as set forth on Exhibit A
attached hereto, and thereafter actually received by the Company or
Executive.  The burden to prove timely
delivery to and receipt by the other party shall be on the party giving notice.


 


(q)                                 “Person” shall mean any individual,
corporation, partnership, limited liability company, association, joint-stock
company, trust, unincorporated organization, or any foreign entity of a similar
nature to any of the above, or a government or political subdivision thereof.


 


(r)                                    “Qualifying Separation” shall mean
Executive’s Separation from Service with the Company: (A) initiated by
Executive for Good Reason or (B) initiated by the Company without
Cause.  A Qualifying Separation shall not
include a Separation from Service: (i) initiated by the Company by reason
of Cause, or (ii) initiated by Executive’s voluntary resignation,
retirement, death or Disability.


 


(s)                                  “Release” shall mean a Waiver and
Release, as described under Section 8 of this Agreement, in a form
substantially the same as that attached as Exhibit B to this Agreement.


 


(t)                                    “Retention Award Amount” shall mean the
product of 1.5% times the Transaction Value.


 


(u)                                 “Retention Pay” shall mean the payments
made to Executive as provided in Section 3 of this Agreement.


 


(v)                                 “Separation from Service” shall mean
Executive’s cessation of services to the Company.  For purposes of this Agreement, Executive is
treated as continuing in employment with the Company while Executive is on
military leave, sick leave, or other bona fide leave of absence if the period
of such leave does not exceed twelve (12) weeks, or if longer, so long as
Executive retains a right to reemployment with the Company under an applicable
statute or by contract.  If the period of
leave exceeds twelve (12) weeks and Executive does not retain a right to reemployment
under an applicable statute or by contract, Executive will be deemed to have a
Separation from Service on the first date immediately following such twelve
(12) week period.


 


(w)                               “Subsidiary” shall mean a corporation,
partnership or other entity of which a majority of the voting interests of such
corporation, partnership or other entity are at the time 


 


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owned directly or indirectly through one or more intermediaries or
Subsidiaries, or both, by the Company.


 


(x)                                   “Term” is defined in Section 5
hereof.


 


(y)                                 “Total Payments” shall mean total
payments subject to the application of Code Sections 280G and 4999 as described
in Section 10 of this Agreement.


 


(z)                                   “Transaction Value” shall mean the amount
of consideration received by the Company and/or its stockholders (treating any
shares issuable upon exercise of options, warrants or other rights of
conversion as outstanding) in connection with a Major Transaction.  For purposes of computing the portion, if any,
of the Transaction Value in non-cash consideration received by the Company or
its stockholders in the Transaction shall be valued as follows:  (i) equity securities traded on a
national securities exchange or quoted in the Nasdaq Global Market or Nasdaq
Capital Market shall be valued at the last closing price thereof immediately
prior to the Closing Date of the transaction; (ii) equity securities that
are traded over the counter shall be valued at the mean between the latest bid
and asked prices prior to such date; and (iii) any other unmarketable
equity securities or interests or non-cash forms of consideration shall be
assumed to have a value equal to their fair market value at the time of the
closing as reasonably determined by the Board of Directors in good faith.


 


Section 2.                                            Continuing Employment Requirement. 
In order for Executive to receive any Retention Pay under this Agreement
as a result of the closing of a Major Transaction, Executive must not have
incurred a Separation of Service prior to the Closing Date of the Major
Transaction; provided, however, if Executive’s Separation from Service
constitutes a Qualifying Separation, Executive shall be entitled to the
Retention Pay so long as the Closing Date of the Major Transaction occurs
within 180 days following Executive’s Separation from Severance.  The Company acknowledges and agrees that as
of the date hereof, to the knowledge of any current member of the Board of
Directors of the Company, no Executive has committed any act, or omitted to
perform any act, that would constitute a breach of his duties and
responsibilities so as to allow the Company to terminate Executive’s employment
from the Company for Cause.


 


Section 3.                                            Retention Pay. 
Subject to Section 2 and the other terms of this Agreement, upon
the occurrence of the Closing Date of a Major Transaction, Executive shall be
entitled to receive the amount equal to Executive’s Percentage of the Retention
Award Amount; provided, however, that if any payment under Section 6
hereof was made to Executive during the term hereof, and the sale of such
Division requiring such payment is also included in the definition of a Major
Transaction, then the Retention Award Amount shall be reduced by the
Distribution Award Amount prior to calculating the Retention Pay for Executive.


 


Section 4.                                            Payment of Retention Pay. 
Executive’s Retention Pay shall be paid in a lump sum upon the Closing
Date.  If, however, Executive is
terminated as a result of a Qualifying Separation from his employment in
connection with a Major Transaction, no Retention Pay shall be payable or
available until after the seven (7) day revocation period (as described in
Section 8 of this Agreement) for a signed Release has expired.  Upon the expiration of the seven (7) day
revocation period, payment of the Retention Pay shall be made within three (3) days
of such expiration, with the payment date being determined by the Agreement 


 


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Administrator in its sole discretion determined in good faith.  All taxes and other deductions required by
law shall be deducted from any Retention Pay. 
In addition to the Retention Pay pursuant hereto, in the event Executive
is terminated during the Term as a result of a Qualifying Separation from his
employment in connection with a Major Transaction, Executive and the Company
agree that, notwithstanding the terms and conditions set forth in the
Employment Agreement, any severance payment to be made to Executive pursuant to
the Employment Agreement (including, without limitation, base salary, pro-rata
bonus award and any amount paid in connection with Executive’s COBRA benefits)
shall be paid to Executive in a lump sum at the same time as the payment of the
Retention Pay.


 


Section 5.                                            Term.  The term of
this Agreement (the “Term”) shall commence on the date hereof and shall end on December 31,
2008 (“Termination Date”).  If a Closing
Date of a Major Transaction has not occurred on or before the Termination Date,
then (i) no payments will be made under this Agreement for any reason, and
(ii) the vesting of equity awards shall not accelerate for any reason
(unless previously accelerated hereunder as the result of a Qualifying
Separation) under this Agreement.


 


Section 6.                                            Sale of Division. 
Subject to the terms hereof, if the Company sells substantially all of
the assets of a Division or the capital stock of a Subsidiary to a
non-Affiliate of the Company, and the following conditions are satisfied (i) such
sale does not constitute (or is included as a part of) a Major Transaction as
of the date of the closing of such sale and (ii) the Company distributes
to its stockholders all or a portion of the consideration received by the
Company in such sale (the amount distributed being the “Distribution Amount”),
then the Company shall pay Executive the amount equal to Executive’s Percentage
multiplied by the Distribution Award Amount (as defined below); provided that
Executive is employed by the Company at the time of such sale, or that
Executive was employed by the Company within the previous 180 days of such sale
and Executive was terminated as a result of a Qualifying Separation.  The term “Distribution Award Amount” shall
mean the product of the Distribution Amount multiplied by 1.5%.


 


Section 7.                                            Acceleration of Equity Awards.


 


(a)                                  Immediately prior to the Closing Date of
a Major Transaction, any equity award (including stock options or restricted
stock) granted to Executive which is not vested and exercisable shall vest and
become exercisable in full; provided that such then fully vested and
exercisable award shall remain subject to the other terms of the plan and/or
agreement under which such award was granted.


 


(b)                                 In addition, if Executive’s employment is
terminated as a result of a Qualifying Separation, any equity award (including
stock options or restricted stock) granted to Executive which is not vested and
exercisable in full shall vest and become exercisable in full as of the date of
Executive’s Separation from Service; provided that such then fully vested and
exercisable award shall remain subject to the other terms of the plan and/or
agreement under which such award was granted.


 


Section 8.                                            Waiver and Release. 
In order to receive the Retention Pay available under this Agreement,
Executive who is terminated as a result of a Qualifying Separation from his 


 


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employment in connection with a Major Transaction must execute and
deliver a signed, enforceable Release to the Agreement Administrator within
forty-five (45) days of the date such Release is provided to Executive.


 


Executive may revoke his signed Release within seven (7) days of
his signing such Release, provided such revocation is made in accordance with
the provisions for revocation set forth below. 
Any such revocation must be made in writing and must be received by the
Agreement Administrator within such seven (7) day period.  Executive who timely revokes his Release
shall not be eligible to receive any Retention Pay under this Agreement.  Executive who timely submits a signed Release
and who does not exercise his right of revocation shall be eligible to receive
Retention Pay under this Agreement. 
Executive is encouraged to contact his personal attorney at his own
expense to review the Release if he so desires. 
Executive’s acceptance and right to retention of Retention Pay are
contingent upon the terms of this Agreement and full compliance with the terms
of the Release.


 


Section 9.                                            Section 409A. 
It is intended that (i) each payment or installment of payments
provided under this Agreement is a separate “payment” for purposes of Code Section 409A
and (ii) the payments satisfy, to the greatest extent possible, the
exemptions from the application of Code Section 409A, including those
provided under Treasury Regulations 1.409A-1(b)(4) (regarding short-term
deferrals), 1.409A-1(b)(9)(iii) (regarding the two-times, two year
exception), and 1.409A-1(b)(9)(v) (regarding reimbursements and other
separation pay).  Notwithstanding
anything to the contrary in this Agreement, if the Company determines (i) that
on the date of Executive’s Separation from Service or at such other time that
the Company determines to be relevant, Executive is a “specified employee” (as
such term is defined under Treasury Regulation 1.409A-1(i)(1)) of the Company
and (ii) that any payments to be provided to Executive pursuant to this
Agreement are or may become subject to the additional tax under Code Section 409A(a)(1)(B) or
any other taxes or penalties imposed under Code Section 409A (“Section 409A
Taxes”) if provided at the time otherwise required under this Agreement, then (A) such
payments shall be delayed until the date that is six (6) months after the
date of Executive’s Separation from Service with the Company, or such shorter
period that, as determined by the Company, is sufficient to avoid the
imposition of Section 409A Taxes (the “Payment Delay Period”) and (B) such
payments shall be increased by an amount equal to the interest on such payments
for the Payment Delay Period at a rate equal to the prime rate in effect as of
the date the payment was first due (for this purpose, the prime rate will be
based on the rate published from time to time in The Wall Street Journal).  Any payments delayed pursuant to this Section 9
shall be made in a lump sum on the first day of the seventh month following
Executive’s Separation from Service, or such earlier date that, as determined
by the Company, is sufficient to avoid the imposition of any Section 409A
Taxes.


 


Section 10.                                      Application of Code Sections 280G and 4999. 
Notwithstanding anything to the contrary contained herein, if any
portion of the Retention Pay or any other payment made under any other
agreement with, or plan of, the Company (including,
without limitation, any accelerated vesting of stock options or restricted
stock granted by the Company) which is paid to Executive (in the aggregate “Total Payments”) would
constitute an “excess parachute payment” under Code Section 280G, then the
Total Payments shall be reduced to the largest amount as will result in no
portion of the Total Payments being subject to the excise tax imposed by Section 4999
of the Code; provided, however, that such reduction to the Total Payments shall be 


 


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made only if
the total after-tax amount received by Executive is greater after giving effect
to such reduction than if no such reduction had been made. Unless Executive
shall have given prior written notice to the Company to effectuate a reduction
in the Total Payments in a manner other than as set forth below, if such a
reduction is required, the Company shall reduce or eliminate the Total Payments
by first reducing or eliminating any cash severance benefits, then by reducing
or eliminating any accelerated vesting of stock options, then by reducing or
eliminating any accelerated vesting of restricted stock, then by reducing or
eliminating any other remaining Total Payments. 
The preceding provisions of this Section 10 shall take precedence
over the provisions of any other plan, arrangement or agreement governing
Executive’s rights and entitlements to any benefits or compensation.  The determination of any reduction in the Total
Payments as a result of the foregoing shall be made by the Company’s
independent auditors in good faith.


 


As a result of the uncertainty in the application of Sections 280G and
4999 of the Code at the time of the determination of whether a reduction to the
Total Payments is required, it is possible that Total Payments to Executive
which will not have been made by the Company (if a reduction to the Total
Payments is made in accordance with the preceding paragraph) should have been
made (“Underpayment”).  Any such
Underpayment shall be promptly paid by the Company to or for the benefit of
Executive.  In the event that a reduction
to the Total Payments is made in accordance with the preceding paragraph and
all or a portion of the Total Payments actually made to Executive (after
reduction, if applicable) shall be determined to result in the imposition of
any tax under Section 4999 of the Code (which was not intended under the
preceding paragraph), Executive shall promptly reimburse the Company for the
amount of such excess together with interest on such amount (at the same rate
as is applied to determine the present value of payments under Section 280G
or any successor thereto), from the date the reimbursable payment was received
by Executive to the date the same is repaid to the Company.


 


Section 11.                                      Agreement Administration. 
The Agreement Administrator shall have the sole, absolute and final
discretionary authority to construe in good faith the terms of this Agreement,
including the making of factual determinations. 
The good faith decisions of the Agreement Administrator shall be final
and conclusive with respect to all questions concerning the interpretation and
administration of this Agreement.  The
Agreement Administrator may delegate to other persons responsibilities for
performing certain of the duties of the Agreement Administrator under the terms
of this Agreement and may seek such expert advice as the Agreement
Administrator deems reasonably necessary with respect to this Agreement.  The Agreement Administrator shall be entitled
to rely upon the information and advice furnished by such delegates and
experts, unless actually knowing such information and advice to be inaccurate
or unlawful.


 


Section 12.                                      No Assignment.  Retention Pay
payable under this Agreement shall not be subject to anticipation, alienation,
pledge, sale, transfer, assignment, garnishment, attachment, execution,
encumbrance, levy, lien, or charge, and any attempt to cause such Retention Pay
to be so subjected shall not be recognized, except to the extent required by
law.


 


Section 13.                                      No Employment Rights.  This
Agreement is not a contract for employment, shall not confer employment rights
upon any person and, subject to Sections 4 and 10 hereof, shall not modify
the terms of any other agreement between the Company and Executive.  Executive shall not be entitled, by virtue of
this Agreement, to remain in the employ 


 


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of the Company, and nothing in this Agreement shall restrict the right
of the Company or its successor to terminate the employment of Executive at any
time.


 


Section 14.                                      Agreement Funding.  The payments
to Executive hereunder shall be made from assets which shall continue, for all
purposes, to be a part of the general, unrestricted assets of the Company.  No person shall have nor acquire any interest
in any such assets by virtue of the provisions of this Agreement or any other
agreement in connection with this Agreement. 
The Company’s obligation hereunder shall be an unfunded and unsecured
promise to pay money in the future.  To
the extent that Executive acquires a right to receive payments from the Company
under the provisions hereof, such right shall be no greater than the right of
any unsecured general creditor of the Company. 
No such person shall have nor require any legal or equitable right,
interest or claim in or to any property or assets of the Company.  Nothing contained in this Agreement, and no
action taken pursuant to its provisions by either party hereto, shall create,
nor be construed to create, a trust of any kind or a fiduciary relationship
between the Company and Executive, his beneficiary, or any other person.


 


Section 15.                                      Survival of Agreement Upon a Major Transaction. 
This Agreement shall survive a Major Transaction and shall be binding
upon any successor entity that is the survivor, successor, reorganized,
affiliated or purchaser organization resulting from a combination,
restructuring, merger, functional reorganization, sale, affiliation or other
reorganization of the Company.  Upon the
Major Transaction, the successor entity shall assume the obligations and
liabilities of this Agreement.  If
Executive was employed by the Company on the Closing Date of a Major
Transaction (or was employed by the Company and was terminated as a result of a
Qualifying Separation less than 180 days prior to the Closing Date of the Major
Transaction) he shall continue to be eligible to receive the Retention Pay
available under this Agreement and, to the extent such Retention Pay has not
been paid by the Company, such Retention Pay shall be payable by the successor
entity.


 


Section 16.                                      Applicable Law.  This
Agreement shall be governed and construed in accordance with ERISA as it
applies to top hat plans for a select group of management or highly compensated
employees and, in the event that any reference shall be made to State law, the
internal laws of the State of California shall apply to the extent not
preempted by ERISA.  It is intended that
this Agreement comply with applicable provisions of Code Section 409A and
the Treasury Regulations promulgated thereunder and, to the extent such section
or regulations apply, this Agreement shall be construed and administered
accordingly.


 


Section 17.                                      Severability.  If any
provision of this Agreement is found, held or deemed by a court of competent
jurisdiction to be void, unlawful or unenforceable under any applicable statute
or other controlling law, the remainder of this Agreement shall continue in
full force and effect.


 


Section 18.                                      Amendment/Termination of Agreement. 
The Company reserves the right in its sole discretion to amend or
terminate this Agreement, and pay amounts due hereunder, to the full extent
permitted by and in accordance with Code Section 409A and the Treasury
Regulations promulgated thereunder at any time, retroactively or otherwise,
either by written resolution of the Company’s Board of Directors or the
Compensation Committee.  Any such 


 


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amendment or termination which would reduce or otherwise adversely
affect the benefits of Executive may not take effect as to Executive without
the written consent of Executive.


 


Section 19.                                      Representations Contrary to this Agreement. 
No employee, officer, or director of the Company has the authority to
alter, vary, or modify the terms of this Agreement except by means of an
authorized written amendment to this Agreement. 
No verbal or written representations contrary to the terms of this
Agreement and its written amendments shall be binding upon this Agreement, the
Agreement Administrator, or the Company, nor may any such representation be
relied upon by Executive.


 


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


 


	
   

  	
  MEADE
  INSTRUMENTS CORP.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/STEVEN L.
  MUELLNER

  	
   

  
	
   

  
	
   

  	
  Its:

  	
  President
  and Chief Executive Officer

  	
   

  
	
   

  
	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  
	
   

  
	
   

  	
               /s/PAUL
  E. ROSS

  	
   

  
					



 


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EXHIBIT
A


 


ADDRESSES


 


	
  Company:

  	
  Meade Instruments Corp.

  
	
   

  	
  6001 Oak Canyon

  
	
   

  	
  Irvine, California 92618

  
	
   

  	
   

  
	
  Executive:

  	
  Paul Ross

  
	
   

  	
  [ADDRESS]

  



 


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EXHIBIT
B


 


MEADE
INSTRUMENTS CORP.

EXECUTIVE RETENTION AGREEMENT


 


WAIVER
AND RELEASE


 


1.                                       Release.  In
consideration for the Retention Pay to be provided to me under the terms of the
Executive Retention Agreement dated as of January 10, 2008 by and between
Meade Instruments Corp. (the “Company”) and the undersigned (“Agreement”), and
after having had a full, unhurried opportunity to consult with an attorney of
my choice with respect to this Waiver and Release (“Waiver”), including its
consent and final binding effect, I, on behalf of myself and my heirs,
executors, administrators, attorneys and assigns, hereby waive, release and
forever discharge the Company and its parent (if any), subsidiaries, divisions
and Affiliates (as defined in the Agreement), whether direct or indirect, its
and their joint ventures and joint venturers (including its and their
respective directors, officers, employees, shareholders, partners and agents,
past, present, and future), and each of its and their respective successors and
assigns (hereinafter collectively referred to as “Releasees”), from any and all
known or unknown demands, damages, actions, causes of action, claims, losses,
or liabilities of any kind which have or could be asserted against the
Releasees arising out of or related to my employment with and/or the
termination of my employment with the Company and/or any of the other Releasees
and/or any other occurrence from the beginning of time up to and including the
date of the Agreement, including but not limited to:


 


(a)                                  All claims, actions, causes of action or
liabilities arising under Title VII of the Civil Rights Act of 1964, as
amended, the Age Discrimination in Employment Act, as amended, Executive
Retirement Income Security Act, as amended, the Rehabilitation Act of 1973, as
amended, the Americans with Disabilities Act, as amended, the Family and
Medical Leave Act, as amended, and/or any other federal, state, municipal, or
local employment discrimination statutes (including, but not limited to, claims
based on age, sex, attainment of benefit plan rights, race, religion, national
origin, marital status, sexual orientation, ancestry, harassment, parental
status, handicap, disability, retaliation, and veteran status); and/or


 


(b)                                 All claims, actions, causes of action or
liabilities arising under any other federal, state, municipal, or local
statute, law, ordinance or regulation; and/or


 


(c)                                  Any and all other claims whatsoever
including, but not limited to, claims for severance pay, claims based upon
breach of contract, wrongful termination, retaliatory discharge, defamation,
intentional infliction of emotional distress, tort, personal injury, invasion
of privacy, violation of public policy, negligence and/or any other common law,
statutory or other claim whatsoever arising out of or relating to my employment
with and/or the termination of my employment with the Company and/or any of the
other Releasees.


 


2.                                       Covenant Not to Sue. 
I also agree never to sue any of the Releasees or become party to a
lawsuit on the basis of any claim of any type whatsoever arising out of or
related to my employment with and/or the termination of my employment with the
Company and/or any of the other Releasees. 
However, I understand that nothing within this Waiver is intended to forfeit
or 


 


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negatively affect my ability or right to file a charge of
discrimination with the Equal Employment Opportunity Commission (“EEOC”) or
participate in such a process by the EEOC. 
I do acknowledge, as set forth below, that I have waived and will return
to the Company any recovery of money damages obtained on my behalf by the EEOC.


 


3.                                       Non-Disparagement. 
I further agree not to make any public statement or statements, to the
press or otherwise, concerning the Company’s Board of Directors, management,
business objectives, status of its securities, its management practices,
products, or other sensitive information, without first receiving the written
consent of the Company’s Chief Executive Officer, and I will not take any
action which would cause the Company, or its employees or agents, embarrassment
or humiliation or otherwise cause or contribute to the Company, or any such
person, being held in disrepute by the general public or the Company’s
employees, clients, or customers.  I
understand that nothing herein is intended to prohibit me from testifying
truthfully in any court or administrative, tax or other proceeding if
subpoenaed to appear to do so.


 


4.                                       Consequence of a Breach. 
I further acknowledge and agree in the event that I breach the
provisions of paragraph 2 or 3, (a) the Company shall not be obligated to
continue payment of the Retention Pay to me, (b) I shall be obligated to
repay to the Company upon written demand ninety percent (90%) of the amount of
Retention Pay paid or provided to me, and (c) I shall be obligated to pay
the Company its costs and expenses in enforcing the provisions of this Waiver
and the Agreement (including court costs, expenses and reasonable legal fees),
and the foregoing shall not affect the validity of this Waiver (and
specifically will not affect my Release of claims as set forth in Paragraph 1)
and shall not be deemed a penalty or a forfeiture.  I specifically acknowledge that the
restrictions, prohibitions, and other provisions of this paragraph are
reasonable, fair, and equitable in scope, terms, and duration, and are a
material inducement to the Company to provide the benefits described in the
Agreement.  I agree that the obligations
in this Waiver are necessary in order to protect the Company’s legitimate
business interests.  I further agree that
upon any breach or threatened breach of these obligations, the Company shall be
entitled to injunctive relief, both temporary and permanent, without the
necessity of posting a bond, as well as, and in addition to, all other
available remedies, including such damages as may be permitted by law, all of
which shall be cumulative and not exclusive.


 


5.                                       Waiver of Recovery. 
I further waive my right to any monetary recovery should any federal,
state, or local administrative agency pursue any claims on my behalf arising
out of or related to my employment with and/or separation from employment with
the Company and/or any of the other Releasees.


 


6.                                       Waiver of Reinstatement Rights. 
I further waive, release, and discharge Releasees from any reinstatement
rights which I have or could have and I acknowledge that I have not suffered
any on-the-job injury for which I have not already filed a claim; and I hereby
unconditionally agree that I shall not now or at any time in the future, either
individually or through others, as an independent contractor or otherwise in
any capacity, directly or indirectly, apply for or otherwise seek employment or
any other arrangement with the Company and/or any of the other Releasees to
provide services to or on behalf of any of the same, without the prior written
consent of the Chief Executive Officer of the Company.


 


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7.                                       Review Period. 
I acknowledge that I have been given at least forty-five (45) days to
consider this Waiver thoroughly and I was advised to consult with my personal
attorney, if desired, before signing below.


 


8.                                       Revocation.  I understand
that I may revoke this Waiver within seven (7) days after its signing and
that any revocation must be made in writing and submitted within such seven day
period to the Agreement Administrator.  I
further understand that if I revoke this Waiver, I shall not receive Retention
Pay.


 


9.                                       Waiver of all Claims. 
I FURTHER UNDERSTAND THAT THIS WAIVER INCLUDES A RELEASE OF ALL KNOWN
AND UNKNOWN CLAIMS.  I HEREBY WAIVE ANY
AND ALL RIGHTS I MAY HAVE UNDER SECTION 1542 OF THE CALIFORNIA CIVIL
CODE, WHICH PROVIDES AS FOLLOWS:


 


A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST
IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.


 


10.                                 Consideration. 
I acknowledge and agree that this Waiver is given in exchange for
consideration in addition to anything of value to which I am already entitled.


 


11.                                 Severability. 
I acknowledge and agree that if any provision of this Waiver is found,
held or deemed by a court of competent jurisdiction to be void, unlawful or
unenforceable under any applicable statute or controlling law, the remainder of
this Waiver shall continue in full force and effect.  If any portion of this Waiver is held by a
court of competent jurisdiction to be unreasonable, unenforceable, arbitrary,
or against public policy, then such portion shall be considered divisible as to
time, geographical area, and prohibited activities, and the remaining
provisions shall remain in effect, and the parties agree to reasonable
modification, including but not limited to modifications as to time,
geographical area, and prohibited activities, as the court shall decide in
order to reflect the intent of the parties.


 


12.                                 Governing Law. 
This Waiver is deemed made and entered into in the State of California,
and in all respects shall be interpreted, enforced and governed under the
internal laws of the State of California, to the extent not preempted by
applicable federal law.


 


Jurisdiction and venue over any dispute under this Waiver shall lie
solely in Orange County, California.


 


13.                                 Knowing and Voluntary Release. 
I further acknowledge and agree that I have carefully read and fully
understand all of the provisions of this Waiver and that I voluntarily and
knowingly enter into this Waiver by signing below.  No modification of this Waiver shall be
effective unless made in writing and signed by both me and the Company.


 


14.                                 Acknowledgment of Compliance. 
Because this Waiver includes a release and waiver as to claims under the
AGE DISCRIMINATION IN EMPLOYMENT ACT (“ADEA”), 


 


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my signature below acknowledges that it complies with the Older Worker
Benefit Protection Act of 1990, as amended (“OWBPA”) and further acknowledges
that I confirm, understand, and agree to the terms and conditions of this
Waiver; that these terms are written in lay person terms, and that I have been
fully advised of my right to seek the advice and assistance of consultants,
including an attorney, as well as tax advisors, to review this agreement.


 


It also acknowledges that I do not waive any rights or claims under the
ADEA that may arise after the date this Waiver is signed by me, and
specifically, that under this Waiver, I am receiving consideration beyond anything
of value to which I am already entitled. 
It is understood by me that I have been advised to consult with an
attorney of my choice before signing.  I
also understand that I have up to forty-five (45) full days to consider whether
to sign this release and agreement.  By
signing this release on the date shown below, I knowingly and voluntarily elect
to forego waiting the portion then remaining of the forty-five (45) full days
to consider whether to sign this Waiver.


 


15.                                 Right of Revocation. 
My signature also acknowledges that, in compliance with the OWBPA
condition above, I have been fully advised by the Company of my right to revoke
and nullify this release and agreement, which right must be exercised, if at
all, within seven (7) days of the date of my signature.  Any revocation of this Waiver must be in
writing, addressed to the Company, to the attention of the Agreement
Administrator of the Agreement, and the Company must be notified within the
foregoing seven (7) day period. 
This Waiver will not become effective or enforceable until the
expiration of the 7-day period.


 


16.                                 Binding Effect. 
Upon signing this Waiver, it will become effective and binding upon me
and the Company and upon the respective successors, assigns, heirs and personal
representatives as is discussed in paragraph 1 above.


 


	
   

  	
  Paul Ross

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/PAUL E. ROSS

  	
   

  
	
   

  	
  (Signature of
  Executive)

  
	
   

  	
   

  
	
   

  	
  January 10,
  2008

  	
   

  
	
   

  	
  (Date)

  
				



 


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