Document:

Exhibit 10.4

AMENDMENT
NO. 1

TO

EMPLOYMENT
AGREEMENT

This AMENDMENT NO. 1 (“Amendment”) to that certain Employment
Agreement, dated June 6, 2001 (“Agreement”),
by and between Aether Holdings Inc. (the “Company”),
as the assignee of Aether Systems, Inc., and David Reymann (“Executive” or “you”), is made on May 5, 2006 (the “Effective Date”).

WHEREAS, the Company and
the Executive desire to amend the Agreement in certain respects, in light of
changes to the Company’s business that have occurred since the Agreement was
originally entered into; and

WHEREAS, the Compensation
Committee of the Company’s Board of Directors has reviewed and approved this
Amendment and the changes to the Agreement that it will effect.

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the undersigned agree as follows:

Section 1.               Amendments.

A.            The
definition of the term “Change In Control,” which is contained in the section
of the Agreement entitled “Equity,” shall be amended by (1) deleting the
word “or” at the end of clause (v), (2) deleting the period at the end of
clause (vi), (3) adding “; or” in place of the period, and (4) adding
the following new clause (vii):

(vii)         the occurrence of a
Trigger Event (as such term is defined in that certain Restricted Stock
Agreement by and between you and the Company, dated May 5, 2006), to the
extent not duplicative of an event set forth in subclauses (i) through (vi) above.

B.            The
second sentence of the first paragraph of the section of the Agreement entitled
“Good Reason” shall be amended and restated to read in its entirety as follows:

“Good Reason” for this purpose means (i) a decrease in your Salary
below the greater of the then current annual amount thereof and $180,000, or a
failure by the Company to pay material compensation due and payable to you in
accordance with the terms of this Agreement or any other applicable agreement
or instrument governing the payment of compensation to you as an employee; (ii) a
material diminution of your responsibilities, positions or titles from those
set forth in this Agreement, including ceasing to be the Chief Financial
Officer of the Company (or its ultimate parent following a Change in Control); (iii) the
Company requiring you to be based at any office or location more than 30 miles
from the Baltimore, Maryland area; or (iv) a material breach of this
Agreement by the Company.

 

 

C.            The
second paragraph of the section of the Agreement entitled “Severance” shall be
amended and restated to read in its entirety as follows:

make a lump-sum severance payment to you in an amount equal to the
greater of  (a) two times the amount
of your annual Salary, as then in effect, or (b) $360,000 within thirty
(30) days after employment ends; provided that, subject to the following sentence, any lump
sum payment shall be made on the date that is, with respect to severance in the
event of termination without Cause, the first regular payroll date 30 days from
the date of termination, or that is, with respect to termination for Good
Reason, the first regular payroll date (based on the Company’s payroll
practices in effect as of the Effective Date) that is subsequent to seven (7) months
after the date of termination (but in any event in accordance with the terms of
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)), or such shorter period that is
permissible in order for such payment not to be considered “nonqualified
deferred compensation” under Section 409A of the Code as determined by the
compensation committee in its sole discretion. In the event that the Company
determines, in good faith, that any payments described in this paragraph would
otherwise violate the provisions of Section 409A(a)(2)(B) of the Code
and the Treasury Regulations promulgated thereunder (prohibiting certain
distributions to “key employees” before six (6) months after the date of
separation from service), then such payments shall not be made during such six (6) month
period, but rather the cumulative amount of such payments otherwise due and not
paid during such six (6) month period shall be made on the first regular
payroll date (based on the Company’s current payroll practices in effect as of
the Effective Date) that is subsequent to seven (7) months after the date
of termination, and the remainder of such payments (if any) shall be made as
set forth in this paragraph; and

D.            The third paragraph of the section of the
Agreement entitled “Severance” shall be amended and restated to read in its
entirety as follows:

pay the then current premium cost payable by the Company for you to
receive any group health benefit you were receiving on the date of your
termination for a period of two (2) years from the date of your
termination; and

E.             The Agreement shall be amended to add the following new
section immediately following the section entitled “Withholding”:

	
  Compliance with Sections 409A of
  the Code

  	
   

  	
  This Agreement is intended to comply and be
  construed in accordance with Section 409A of the Code and any rulings or
  regulations thereunder. In the event that (a) the Company determines
  that there is an ambiguity with respect to any provision of this Agreement
  that could cause such provision to be subject to Section 409A of the
  Code, such ambiguity shall be interpreted and resolved in the manner that the
  Company deems necessary to avoid the imposition of a tax pursuant to Section 409A
  and (b) the Company reasonably 

   

  

 

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  determines that any amendment to the Agreement is
  necessary or appropriate in order to avoid the imposition of a tax pursuant
  to Section 409A of the Code, the Company shall have the right to make
  such amendment, on a prospective or retroactive basis, in its sole
  discretion, provided that in any event the Company shall act in good faith to
  minimize the amount of any reduction in any benefits or compensation paid to
  or received by you (including either the delay or acceleration in the payment
  thereof) in order to prevent the imposition of Section 409A from
  applying to such provision. Assuming the Company concludes that a waiver by the executive of any
  right to receive a portion of the payments or benefits contemplated by the
  Agreement would not result in the application of the penalty tax under
  Section 409A to the Executive (or would permit payments to be made to the
  Executive more quickly without imposition of any such tax), if the Executive
  has advised the Company that it desires to waive such right, the Company
  shall in good faith work with the Executive to implement a waiver in form and
  substance acceptable to the parties. 

  

 

F.             The
definition of “Restricted Period” contained in Exhibit A to the Agreement
shall be amended to replace the word “first” immediately preceding the word “anniversary”
with the word “second.”

Section 2.               Effect of Amendment. Except as set forth
in Section 1 of this Amendment, the provisions of the Agreement shall not
be amended or altered by this Amendment and shall continue in full force and
effect.

Section 3.               Miscellaneous. This Amendment shall be
governed by the internal laws of the State of Maryland. This Amendment may be
executed in one or more counterparts, each of which when executed and delivered
shall be deemed to be an original and all counterparts taken together shall
constitute one and the same instrument. This Amendment and the Agreement (as
amended hereby) constitute the entire understanding of the parties hereto with
respect to the subject matter hereof, and any and all prior agreements and
understandings between the parties regarding the subject matter hereof, whether
written or oral, except for the Agreement (as amended hereby), are superceded
by this Amendment. Any provision of this Amendment which is invalid or
unenforceable in any jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability without invalidating or rendering unenforceable
the remaining provisions hereof, and any invalidity or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

End of
Page.

Signature
Page Follows

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IN WITNESS WHEREOF, this
Amendment has been duly executed and delivered by the undersigned parties on
the Effective Date.

	
  

  	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AETHER HOLDINGS
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ David Oros

  
	
   

  	
   

  	
  David Oros,
  Chairman and Chief

  Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ David
  Reymann

  
	
   

  	
   

  	
  David Reymann

  

 

 4Exhibit 10.5

AETHER HOLDINGS
INC.

1999 ACQUISITION INCENTIVE PLAN

RESTRICTED STOCK GRANT AGREEMENT

May 5, 2006

David Oros:

Aether Holdings Inc. (“Aether”)
hereby grants you (the “Grant”) under its 1999 Acquisition Incentive Plan (the “Plan”)
150,000 shares of Aether common stock (the “New Shares”), subject to certain
restrictions specified below. While subject to the restrictions, this Agreement
refers to the New Shares as “Restricted Stock.”

The Grant is subject in
all respects to the applicable provisions of the Plan. This Agreement does not
cover all of the rules that apply to the Grant under the Plan, and the
Plan defines any terms in this Agreement that the Agreement does not define.

In addition to the terms
and restrictions in the Plan, the following terms and restrictions apply to the
Grant:

	
  RESTRICTIONS AND FORFEITURE

  	
  You may not sell, assign, pledge, encumber or
  otherwise transfer any interest in the Restricted Stock until the date set
  forth in the Vesting Schedule in Exhibit A (at which point the Restricted
  Stock will be referred to as “Vested”).

  Unless the Administrator determines otherwise at any
  time or Exhibit A provides otherwise, if your service with Aether (or
  its subsidiaries) terminates for any reason before all of your shares of
  Restricted Stock are Vested, then you will forfeit those shares that are
  unvested to the extent that they do not otherwise vest as a result of the
  termination. In addition, any shares that are not Vested as of the date that
  is seven (7) years from the Grant Date (as set forth in Exhibit A)
  shall be forfeited by Executive.
  Any forfeited unvested shares will revert immediately to Aether. You
  will receive no payment for the shares that you forfeit. 

  
	
   

  	
   

  
	
  VESTING 

  	
  Assuming you remain an employee of Aether, all
  restrictions under RESTRICTIONS AND FORFEITURES will lapse in accordance with
  the Vesting Schedule set forth in Exhibit A. For purposes of this
  Restricted Stock Agreement and Exhibit A, the term “Trigger Event” means
  the date on which the Company consummates a Qualifying Acquisition. The term “Qualifying
  Acquisition” shall mean an acquisition by the Company (or a wholly owned
  subsidiary of the Company) of a business (whether in a single transaction or
  a series of related transactions), whether by the purchase of stock or assets
  (including by means of a merger), that the Board of Directors determines (a) has
  an appropriate level of historical profitability, or strong prospects for
  appropriate profitability in the near term, evaluated in light of the Company’s
  business objectives and (b) provides the Company with a viable platform
  for the development of a 

  

 

 

 

	
   

  	
  profitable new line of business or a new business
  segment. On the date of the Trigger Event, each share of Restricted Stock
  will become Vested.

  Notwithstanding anything in this Restricted Stock
  Agreement to the contrary, the Restricted Shares shall become Vested
  immediately (i) upon a Change of Control, as defined in the Plan, or
  (ii) if you are terminated without Cause (as defined in your Employment
  Agreement, dated July 7, 1999, as amended by Amendment No. 1, dated
  May 5, 2006 (the “Employment Agreement”), because of Disability (as
  defined in the Employment Agreement), or because of your death or if you
  terminate your employment with Good Reason. “Good Reason” shall mean
  (i) a decrease in your Salary (as defined in the Employment Agreement)
  below the then current amount thereof annually, or a failure by the Company
  to pay material compensation due and payable to you in accordance with the
  terms of your Employment Agreement or any other applicable agreement or
  instrument governing the payment of compensation to you as an employee;
  (ii) a material diminution of your responsibilities, positions or titles
  from those set forth in your Employment Agreement, including ceasing to be
  the Chief Executive Officer of the Company (or its ultimate parent following
  a Change in Control) other than following the occurrence of a Trigger Event;
  (iii) the Company requiring you to be based at any office or location
  more than 30 miles from the Baltimore, Maryland area; or (iv) a material
  breach of your Employment Agreement by the Company.

  You agree and covenant that you will not dispose of
  such Vested New Shares in any manner that is violative of the Company’s
  bylaws, articles, and policies, including but not limited to the Company’s
  insider trading policy, violative of any applicable law, including but not
  limited to applicable state and federal securities laws, and, in any event,
  until the date that any and all information regarding the Trigger Event
  required to be filed with the appropriate governmental agency and made
  publicly available according to federal and state securities laws, NASD
  rules and regulations or any other applicable governing agency or entity
  is so filed and disclosed in the appropriate manner.

  
	
   

  	
   

  
	
  LIMITED STATUS

  	
  You understand and agree that Aether will not
  consider you a stockholder for any purpose with respect to shares of
  Restricted Stock, unless and until such shares have become Vested.

  
	
   

  	
   

  
	
  VOTING

  	
  You may not vote the Restricted Shares unless and
  until such shares become Vested.

  
	
   

  	
   

  
	
  POSSESSION

  	
  While unvested, the Restricted Stock will be held by
  an agent or service provider designated by Aether. After the shares become
  Vested, Aether will direct the transfer of the New Shares to you in book
  entry form (either directly or to a brokerage firm).

  
	
   

  	
   

  
	
  ADDITIONAL CONDITIONS TO RECEIPT

  	
  Aether may postpone issuing and delivering any New
  Shares for so long as Aether determines to be advisable to satisfy the
  following:

  ·      Its completing or amending any
  securities registration or 

  

 

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  qualification
  of the New Shares or its or your satisfying any exemption from registration
  under any federal or state law, rule or regulation;

  ·      Its receiving proof it considers
  satisfactory that a person seeking to receive the New Shares upon your death
  is entitled to do so;

  ·      Your complying with any requests for
  representations under the Plan; and

  ·      Your complying with any federal, state
  or local tax withholding obligations.

  
	
   

  	
   

  
	
  ADDITIONAL REPRESENTATIONS

  FROM YOU

  	
  If you receive the New Shares at a time when Aether
  does not have a current registration statement under the Securities Act of
  1933, as amended (the “Act”), that covers the issuance of the New Shares to
  you, you must, before Aether will release the New Shares to you:

  ·      represent to Aether, in a manner
  satisfactory to Aether’s counsel, that you are acquiring the New Shares for
  your own account and not with a view to reselling or distributing the New
  Shares, and

  ·      agree that you will not sell, transfer
  or otherwise dispose of the New Shares unless (i) a registration
  statement under the Act is effective at the time of disposition with respect
  to the New Shares you propose to sell, transfer or otherwise dispose of or
  (ii) Aether has received an opinion of counsel or other information and
  representations it considers satisfactory to the effect that, because of
  Rule 144 promulgated under the Act or otherwise, no registration under
  the Act is required.

  
	
   

  	
   

  
	
  ADDITIONAL RESTRICTION

  	
  You will not receive the New Shares if issuing the
  New Shares would violate any applicable federal or state securities laws or
  other applicable laws or regulations.

  
	
   

  	
   

  
	
  NO EFFECT ON EMPLOYMENT OR OTHER RELATIONSHIP

  	
  Nothing in this Restricted Stock Agreement restricts
  Aether’s rights or those of any of its affiliates to terminate your
  employment or other relationship with the Company at any time, with or
  without cause. The termination of employment or other relationship, whether
  by Aether or any of its affiliates or otherwise, and regardless of the reason
  for such termination, has the consequences provided for under the Plan and
  any applicable employment or severance agreement or plan.

  
	
   

  	
   

  
	
  GOVERNING LAW

  	
  The laws of the State of Delaware will govern all
  matters relating to this Restricted Stock Agreement, without regard to the
  principles of conflicts of laws thereof.

  
	
   

  	
   

  
	
  NOTICES

  	
  Notice must be given in writing by personal
  delivery, by certified mail, return receipt requested, by facsimile or by
  overnight delivery. You must send your notice to the Secretary of the Company
  at the address of the Company’s headquarters. The Company will send or
  deliver any notice to

  

 

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  be given to you to the address set forth on
  Exhibit A hereto. Both parties hereto may change their respective
  addresses for notice by given the other party appropriate notice hereunder.

  
	
   

  	
   

  
	
  PLAN GOVERNS

  	
  Wherever a conflict may arise between the terms of
  the Plan and this Restricted Stock Agreement, the terms of the Plan will
  control.

  

 

	
  

  	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AETHER
  HOLDINGS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ David
  Reymann

  
	
   

  	
   

  	
  David Reymann,
  Chief Financial Officer

  

 

 4
 

 

EXHIBIT
A

Recipient Information:

	
  Name:

  	
   

  	
  David Oros

  
	
   

  	
   

  	
   

  
	
  SSN:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

Grant Information:

	
  Restricted Shares:

  	
  150,000

  
	
   

  	
   

  
	
  Date of Grant:

  	
  05/05/06

  
	
   

  	
   

  
	
  Vesting Schedule:

  	
  Restricted Shares shall become nonforfeitable (“Vested”)
  as follows, subject to earlier vesting in accordance with the other terms of
  the Restricted Stock Agreement:

  50,000 of the shares shall become Vested New Shares
  on the first anniversary of the date on which a Trigger Even occurs (the “Trigger
  Date”), provided that you are employed by the Company on such date,

  50,000 of the shares shall become Vested New Shares
  on the second anniversary of the Trigger Date, provided that you are employed
  by the Company on such date, and

  50,000 of the shares shall become Vested New Shares
  on the third anniversary of the date Trigger Event (each a “Vesting Date”),
  provided that you are employed by the Company on such date. 

  
	
   

  	
   

  
	
  Grant Expiration Rules:

  	
  You will forfeit any unvested portion of this Grant
  immediately upon the first to occur of (i) the date you cease to be
  employed by the Company, unless such termination is without Cause, because of
  your death or Disability, or with Good Reason, all as described in the
  Restricted Stock Agreement, and (ii) 05/05/13.

  
	
   

  	
   

  
	
  Special Tax Rule:

  	
  The Administrator has determined that, as
  contemplated by the terms of the Plan, you may satisfy all or any portion of
  any tax withholding obligation that may arise as a result of the Vesting of
  New Shares by directing the Company to retain shares from the Vested New
  Shares. In such event, the Company shall remit to the applicable taxing
  authorities, on your behalf (as a withheld amount) an amount equal to the
  number of Vested New Shares retained by the Company, multiplied by the fair
  market value of such Vested New Shares on the date of their retention by the
  Company (which shall be the date of vesting of such New 

  

 

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  Shares).

  

 

I acknowledge that I
received a copy of the Plan. I represent that I have read and am familiar with
the Plan’s terms. By executing where indicated below, I accept the Grant
subject to all of the terms and provisions of this Restricted Stock Agreement
and of the Plan under which the Grant is made, as the Plan may be amended from
time to time in accordance with its terms. I agree to accept as binding,
conclusive and final all decisions or interpretations of the Administrator
concerning any questions arising under the Plan with respect to the Grant.

	
  

  	
   

  	
  /s/ David Oros

  
	
   

  	
   

  	
  David Oros

  

 

 6

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