AND KNOWLEDGE
EXCLUSIVELY TO THE ADVANCEMENT OF THE BUSINESS AND INTERESTS OF THE COMPANY AND
ITS AFFILIATES AND TO THE DISCHARGE OF HIS DUTIES AND RESPONSIBILITIES
HEREUNDER. THE EXECUTIVE SHALL NOT ENGAGE IN ANY OTHER BUSINESS ACTIVITY OR
ACCEPT ANY PROFESSIONAL, GOVERNMENTAL OR ACADEMIC POSITION DURING THE TERM OF
THIS AGREEMENT, EXCEPT FOR NON-PROFIT ACTIVITIES THAT DO NOT MATERIALLY
INTERFERE WITH THE PERFORMANCE OF THE EXECUTIVE'S SERVICES HEREUNDER OR AS MAY
BE EXPRESSLY APPROVED IN ADVANCE BY THE BOARD IN WRITING.
4.
COMPENSATION AND BENEFITS. AS COMPENSATION FOR ALL SERVICES
PERFORMED BY THE EXECUTIVE UNDER AND DURING THE TERM HEREOF AND SUBJECT TO
PERFORMANCE OF THE EXECUTIVE'S DUTIES AND OF THE OBLIGATIONS OF THE EXECUTIVE TO
THE COMPANY AND ITS AFFILIATES PURSUANT TO THIS AGREEMENT:
(A)
BASE SALARY. THE COMPANY SHALL PAY THE EXECUTIVE A BASE SALARY AT
THE RATE OF THREE HUNDRED AND FIFTY THOUSAND DOLLARS ($350,000) PER ANNUM,
PAYABLE IN ACCORDANCE WITH THE PAYROLL PRACTICES OF THE COMPANY FOR ITS
EXECUTIVES.
SUCH BASE SALARY SHALL BE REVIEWED BY THE BOARD ON NO LESS THAN AN
ANNUAL BASIS, AND SHALL BE SUBJECT TO INCREASE AT SUCH TIMES BY THE BOARD, IN
ITS SOLE DISCRETION, BUT SHALL NOT BE SUBJECT TO DECREASE. SUCH BASE SALARY, AS
FROM TIME TO TIME INCREASED, IS HEREAFTER REFERRED TO AS THE "BASE SALARY."
(B)
INCENTIVE AND BONUS COMPENSATION.
(I)
THE EXECUTIVE SHALL BE ELIGIBLE ANNUALLY FOR A BONUS (THE "ANNUAL
BONUS") AS DETERMINED BY THE BOARD WITH A TARGET (THE "TARGET BONUS") OF 75% OF
THE BASE SALARY.
THE RANGE OF POSSIBLE ANNUAL BONUS SHALL BE DETERMINED
ANNUALLY BUT SHALL NOT BE LESS THAN 150% OF THE TARGET BONUS ON THE UPSIDE.
FOR
2008, THE RANGE OF POTENTIAL ANNUAL BONUS SHALL BE 0% TO 200% OF TARGET BONUS.
THE AMOUNT OF THE ANNUAL BONUS SHALL BE DETERMINED ANNUALLY BY THE BOARD, BASED
ON ITS ASSESSMENT, IN ITS REASONABLE DISCRETION, OF THE EXECUTIVE'S PERFORMANCE
AND THAT OF THE COMPANY AGAINST APPROPRIATE AND REASONABLY OBTAINABLE GOALS
WHICH SHALL BE ESTABLISHED NO LATER THAN MARCH 31ST OF THE CALENDAR YEAR IN
QUESTION BY THE COMPENSATION COMMITTEE OF THE BOARD AFTER CONSULTATION WITH THE
EXECUTIVE.
THE PARTIES ACKNOWLEDGE THAT THE COMPENSATION COMMITTEE MAY REVISE
THE BONUS GOALS APPLICABLE TO ALL EXECUTIVES OF THE COMPANY, INCLUDING THE
EXECUTIVE, DURING A
2
CALENDAR YEAR IN CONSULTATION WITH THE EXECUTIVE.
IN THE EVENT AN ANNUAL BONUS
IS PAYABLE HEREUNDER FOR A PORTION OF A CALENDAR YEAR (SUCH AS 2008, WHEN THE
EXECUTIVE WILL NOT HAVE BEEN EMPLOYED FOR A FULL CALENDAR YEAR), THE ANNUAL
BONUS WILL BE PRO-RATED FOR THE PORTION OF THE YEAR DURING WHICH THE EXECUTIVE
WAS EMPLOYED BY THE COMPANY.
THE ANNUAL BONUS (INCLUDING ANY PRO-RATED BONUS),
IF ANY, SHALL BE PAID IN ACCORDANCE WITH THE COMPANY'S REGULAR BONUS PAYMENT
PRACTICES BUT NOT LATER THAN TWO AND ONE-HALF MONTHS FOLLOWING THE END OF THE
CALENDAR YEAR DURING WHICH THE BONUS WAS EARNED. ANY BONUS OR INCENTIVE
COMPENSATION PAID TO THE EXECUTIVE SHALL BE IN ADDITION TO THE