ONE HUNDRED AND FIFTY (150%) OF HIS BASE SALARY FOR THE APPLICABLE
FISCAL YEAR AS OF THE LAST DAY OF THE APPLICABLE FISCAL YEAR.
THE ANNUAL TARGET
FOR THE EMPLOYEE'S BONUS WILL BE AT SIXTY PERCENT (60%) OF THE APPLICABLE BASE
SALARY.
THE BOARD WILL DETERMINE, IN ITS SOLE DISCRETION, AFTER CONSIDERATION
OF THE RECOMMENDATION OF THE COMPENSATION COMMITTEE, WHETHER (AND IN WHAT
AMOUNT) A BONUS AWARD IS PAYABLE TO THE EMPLOYEE.
IN DETERMINING WHETHER A
BONUS AWARD
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IN ANY GIVEN YEAR SHALL BE GRANTED, THE BOARD WILL REVIEW WHETHER THE COMPANY
HAS ACHIEVED ITS ANNUALLY APPROVED OPERATING PLAN AS WELL AS WHETHER THE
EMPLOYEE HAS ACHIEVED HIS PERSONAL OBJECTIVES AS ESTABLISHED BY THE BOARD.
To be eligible to receive a bonus award, the Employee must be an active employee
on the date any such bonuses are distributed.
3.3
EMPLOYEE BENEFITS.
(A)
COMPANY-SPONSORED BENEFIT PLANS. THE EMPLOYEE SHALL BE ENTITLED TO
PARTICIPATE IN ALL BENEFIT PLANS AND PROGRAMS THAT THE COMPANY ESTABLISHES AND
MAKES AVAILABLE TO ITS EMPLOYEES TO THE EXTENT THAT THE EMPLOYEE IS ELIGIBLE
UNDER (AND SUBJECT TO THE PROVISIONS OF) THE PLAN DOCUMENTS GOVERNING THOSE
PROGRAMS.
THE EMPLOYEE SHALL BE ENTITLED TO FIVE (5) WEEKS PAID VACATION PER
YEAR TO BE ADMINISTERED IN ACCORDANCE WITH COMPANY POLICY.
(B)
LIFE AND DISABILITY INSURANCE.
THE COMPANY SHALL REIMBURSE THE
EMPLOYEE THE PREMIUM FOR MAINTAINING A $3 MILLION LIFE AND DISABILITY INSURANCE
POLICY UP TO A MAXIMUM REIMBURSEMENT OF $5,000 PER YEAR, FOR AS LONG AS AND TO
THE EXTENT THAT THE EMPLOYEE IS EMPLOYED BY THE COMPANY.
IN ADDITION, THE
COMPANY WILL PROVIDE THE EMPLOYEE WITH AN ADDITIONAL PAYMENT TO OFFSET THE
ESTIMATED TAX LIABILITY FOR SUCH REIMBURSEMENT (HEREINAFTER, FOR PURPOSES OF
THIS SECTION ONLY, THE "GROSS UP"), BUT SUCH PAYMENT SHALL NOT INCLUDE ANY
PAYMENTS TO OFFSET THE ESTIMATED TAX LIABILITY OF SUCH GROSS UP.
3.4
REIMBURSEMENT OF EXPENSES.
THE COMPANY SHALL REIMBURSE THE
EMPLOYEE FOR ALL REASONABLE TRAVEL, ENTERTAINMENT AND OTHER EXPENSES INCURRED OR
PAID BY THE EMPLOYEE IN CONNECTION WITH, OR RELATED TO, THE PERFORMANCE OF HIS
DUTIES, RESPONSIBILITIES OR SERVICES UNDER THIS AGREEMENT, UPON PRESENTATION BY
THE EMPLOYEE OF DOCUMENTATION, EXPENSE STATEMENTS, VOUCHERS AND/OR SUCH OTHER
SUPPORTING INFORMATION AS THE COMPANY MAY REASONABLY
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REQUEST; PROVIDED, HOWEVER, THAT THE AMOUNT AVAILABLE FOR SUCH TRAVEL,
ENTERTAINMENT AND OTHER EXPENSES MAY BE FIXED IN ADVANCE BY THE BOARD.
3.5
EQUITY.
(A)
ON THE COMMENCEMENT DATE, THE COMPANY WILL GRANT THE EMPLOYEE AN
OPTION TO PURCHASE 375,000 SHARES OF COMMON STOCK OF THE COMPANY $.0001 PAR
VALUE PER SHARE ("COMMON STOCK") AT AN EXERCISE PRICE EQUAL TO THE FAIR MARKET
VALUE OF THE COMMON STOCK ON THE DATE OF THE GRANT (SUCH SHARES, THE "INITIAL
SHARES"), AS EVIDENCED BY STOCK OPTION AGREEMENTS WITH THE EMPLOYEE (THE "OPTION
AGREEMENTS"), SUBSTANTIALLY IN THE FORMS OF EXHIBIT A AND EXHIBIT B TO THIS
AGREEMENT.
THE OPTION TO PURCHASE SUCH INITIAL SHARES SHALL VEST OVER A FOUR
(4) YEAR PERIOD IN ACCORDANCE WITH THE TERMS AND PROVISIONS OF THE