AND AGREES: (I) THAT EXECUTIVE HAS THE FULL RIGHT TO ENTER INTO THIS
AGREEMENT AND PERFORM THE SERVICES REQUIRED OF HIM HEREUNDER, WITHOUT ANY
RESTRICTION WHATSOEVER; (II) THAT IN THE COURSE OF PERFORMING SERVICES
HEREUNDER, EXECUTIVE WILL NOT VIOLATE THE TERMS OR CONDITIONS OF ANY AGREEMENT
BETWEEN HIM AND ANY THIRD PARTY OR INFRINGE OR WRONGFULLY APPROPRIATE ANY
PATENTS, COPYRIGHTS, TRADE SECRETS OR OTHER INTELLECTUAL PROPERTY RIGHTS OF ANY
PERSON ANYWHERE IN THE WORLD; (III) THAT EXECUTIVE HAS NOT AND WILL NOT DISCLOSE
OR USE DURING HIS EMPLOYMENT BY THE COMPANY ANY CONFIDENTIAL INFORMATION THAT HE
ACQUIRED AS A RESULT OF ANY PREVIOUS EMPLOYMENT OR CONSULTING ARRANGEMENT OR
UNDER A PREVIOUS OBLIGATION OF CONFIDENTIALITY; AND (IV) THAT EXECUTIVE HAS
DISCLOSED TO THE COMPANY IN WRITING ANY AND ALL CONTINUING OBLIGATIONS TO
PREVIOUS EMPLOYERS OR OTHERS THAT REQUIRE HIM NOT TO DISCLOSE ANY INFORMATION TO
THE COMPANY.
(B)
BETWEEN COMPANY AND THIRD PARTIES.
EXECUTIVE ACKNOWLEDGES THAT
THE COMPANY FROM TIME TO TIME MAY HAVE AGREEMENTS WITH OTHER PERSONS, INCLUDING
THE GOVERNMENT OF THE UNITED STATES OR OTHER COUNTRIES AND AGENCIES THEREOF,
WHICH IMPOSE OBLIGATIONS OR RESTRICTIONS ON COMPANY REGARDING INVENTIONS MADE
DURING THE COURSE OF WORK THEREUNDER OR REGARDING THE CONFIDENTIAL NATURE OF
SUCH WORK.
EXECUTIVE AGREES TO BE BOUND BY ALL SUCH OBLIGATIONS AND
RESTRICTIONS AND TO TAKE ALL ACTION NECESSARY TO DISCHARGE THE OBLIGATIONS OF
THE COMPANY THEREUNDER.
3.5.
LOCATION.
EXECUTIVE INITIALLY SHALL BE BASED AT THE COMPANY'S
PRINCIPAL EXECUTIVE OFFICES IN LANGHORNE, PENNSYLVANIA AND SHALL MAINTAIN A
RESIDENCE WITHIN 75 MILES OF LANGHORNE.
4.
COMPENSATION AND BENEFITS.
4.1.
SALARY.
COMPANY SHALL PAY EXECUTIVE A BASE SALARY ("SALARY"),
PAYABLE IN EQUAL INSTALLMENTS IN ACCORDANCE WITH COMPANY'S STANDARD SCHEDULE FOR
SALARY PAYMENTS TO ITS EXECUTIVE EMPLOYEES, AT AN INITIAL ANNUAL RATE EQUAL TO
$225,000.
EXECUTIVE'S SALARY SHALL BE REVIEWED ANNUALLY BY THE CHIEF EXECUTIVE
OFFICER AND MAY BE INCREASED AT THE BEGINNING OF EACH CALENDAR YEAR.
4.2.
BONUS.
EXECUTIVE WILL BE ELIGIBLE TO PARTICIPATE IN COMPANY'S
INCENTIVE COMPENSATION PLAN FOR SENIOR MANAGERS (THE "BONUS PLAN").
ANY BONUS
AWARDED UNDER THE BONUS PLAN FOR A GIVEN YEAR ("PLAN BONUS") WILL BE SUBJECT TO
THE TERMS AND CONDITIONS OF THE BONUS PLAN AND BASED ON (I) COMPANY'S
PERFORMANCE DURING SUCH YEAR MEASURED AGAINST ONE OR MORE COMPANY GOALS SET BY
THE CHIEF EXECUTIVE OFFICER AT THE BEGINNING OF SUCH YEAR, AND (II) EXECUTIVE'S
PERFORMANCE DURING SUCH YEAR MEASURED AGAINST ONE OR MORE JOB-SPECIFIC GOALS
2
DETERMINED BY THE CHIEF EXECUTIVE OFFICER AND EXECUTIVE AT THE BEGINNING OF SUCH
YEAR.
EXECUTIVE'S PLAN BONUS FOR A GIVEN YEAR WILL BE TARGETED AT 35% OF SALARY
FOR SUCH YEAR, SUBJECT TO APPROVAL BY THE COMPENSATION COMMITTEE OF THE BOARD OF
DIRECTORS (THE "COMPENSATION COMMITTEE").
4.3.
STOCK OPTIONS.
SUBJECT TO APPROVAL BY THE COMPENSATION COMMITTEE,
THE COMPANY SHALL GRANT TO EXECUTIVE A NONQUALIFIED STOCK OPTION (THE "OPTION")
TO PURCHASE 150,000 SHARES OF THE COMPANY'S COMMON STOCK, $0.001 PAR VALUE PER
SHARE ("COMMON STOCK").
THE OPTION SHALL HAVE AN EXERCISE PRICE PER SHARE EQUAL
TO THE