Document:

Unassociated Document

    Exhibit
      10.8

    Addendum
      to Employment Agreement

     

    This
      Addendum dated February 28, 2006, to the Employment Agreement by and between
      IXI
      Mobile, Inc., a Delaware corporation (the “Corporation”)
      and
      Amit Haller (“Employee”)
      effective as of March 1, 2001 as amended on June 1, 2001 (“Addendum
      1”)
      and as
      of January 1, 2006 (“Addendum
      2”)
      (the
“Employment
      Agreement”)
      is
      entered into by and between Company and Employee 
      (the
“Addendum”).

     

    
      	Whereas:  	
              Employee
                is employed by the Corporation as of March 1, 2001, pursuant to the
                Employment Agreement; 

            

    

     

    
      	Whereas:  	
              The
                parties have agreed that, as of the date of the closing of the
                contemplated merger transaction (the “Addendum
                Effective Date”
                and the “Closing”,
                respectively), among the Corporation, the Israel Technology Acquisition
                Corp., and the ITAC Acquisition Subsidiary Corp. (the “Group”)
                and subject thereto, the terms of the Employee’s employment shall be
                automatically modified and the Employment Agreement amended, in accordance
                with the terms set forth below. 

            

    

     

    Therefore,
      it
      is
      hereby stipulated and agreed between the parties as follows:

     

    
      	
              1.

            	
              The
                preface to this Addendum constitutes an indivisible and integral
                part
                thereof.

            

    

     

    
      	
              2.

            	
              Unless
                otherwise defined herein, the capitalized terms appearing herein
                shall
                have the meanings attributed to them in the Employment Agreement
                or, where
                so expressly indicated, in the Agreement and Plan of Merger entered
                into
                as of February 28, 2006 (the "Merger
                Agreement").

            

    

     

    
      	
              3.

            	
              As
                of the Addendum's Effective Date, the terms of Employee’s employment shall
                be modified and the Employment Agreement amended as
                follows:

            

    

     

    
      	 	
              3.1.

            	
              The
                Salary (as defined in Section 3.1 (a) of the Employment Agreement
                and as
                amended by Addendum 1 and thereafter by Addendum 2 to the Employment
                Agreement) shall be increased to the annual gross sum of US$250,000
                (two
                hundred fifty thousand US dollars) payable in 12 monthly installments
                beginning with the monthly installment of the Salary payable for
                the month
                in which the Closing shall occur, with the aforesaid increase in
                the
                Salary being paid for said month on a pro-rata basis, for that portion
                of
                the month following the Closing. 

            

    

     

    
      	 	
              3.2.

            	
              Annual
                Bonus

            

    

     

    
      	 	
              3.2.1.

            	
              In
                addition to the Salary, and commencing with the 2006 calendar year,
                the
                Employee shall be entitled to an annual bonus for each calendar year
                in
                which he was employed in a gross amount calculated as follows (the
                “Annual
                Bonus”):

            

    

     

    A
      gross
      amount equal to 2% (two percent) of that portion of the Group’s net income (as
      such term is defined in Section 2.15 of the Merger Agreement) which exceeds
      the
      amount of the net income of the Group in the immediately preceding calendar
      year
      (the “Profit
      Increase”).
      

     

    For
      the
      removal of doubt, it is hereby clarified that the baseline for the calculation
      of the Profit Increase for the 2006 calendar year shall be the net income of
      the
      Corporation in 2005 calendar year and if the financial statements of the
      Corporation for 2005 show no net income then the baseline amount shall be zero.
      

     

    
      	 	
              3.2.2.

            	
              The
                Annual Bonus shall be paid within five (5) Business Days following
                the
                filing of the Parent’s Annual Report on Form 10K with the Securities and
                Exchange Commission for the relevant year. Subject to the provisions
                of
                Section 3.4 of this Addendum, in the event of a termination of the
                Employment Agreement prior to completion of any calendar year and/or
                prior
                to the publication of the financial statements for a given calendar
                year,
                Employee shall be entitled to the proportionate share of the Annual
                Bonus
                and the Target Bonuses (based upon a calculation of the applicable
                bonus
                for the entire calendar year in which the Employment Agreement has
                been
                terminated), as the case may be, which shall be paid within the timeframe
                provided for in the Addendum.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3.3. Target
      Bonuses

     

    Options

     

    3.3.1. Immediately
      following the Closing, the Board of Directors of the Parent shall grant Employee
      options to purchase 750,000 shares of the Parent's Common Stock (the
      "Additional
      Options")
      which
      shall vest in accordance with the following terms:

     

    3.3.1.1. Upon
      reaching the 2007 Net Profit Target (as defined in, and in accordance with
      the
      terms of, the Merger Agreement), an aggregate number of Additional Options
      shall
      vest equal to 150,000 multiplied by a fraction (A) the numerator of which shall
      be the excess of Parent’s net income of the calendar year ending December 31,
      2007 over $15,000,000 and (B) the denominator of which shall be $10,000,000.
      In
      no event shall the fraction in the preceding sentence exceed one (1);
any
      of
      the foregoing Additional Options which were not vested in accordance with the
      foregoing shall
      expire and be of no further effect; and 

     

    3.3.1.2. Upon
      reaching the 2008 Net Profit Target (as defined in, and in accordance with
      the
      terms of, the Merger Agreement) an aggregate number of Additional Options shall
      vest equal to 150,000 multiplied by a fraction (A) the numerator of which shall
      be the excess of Parent’s net income for the calendar year ending December 31,
      2008 over $20,000,000 and (B) the denominator of which shall be $25,000,000.
      In
      no event shall the fraction in the preceding sentence exceed one (1);
any
      of
      the foregoing Additional Options not vested in accordance with the foregoing
      shall
      expire and be of no further effect; and

     

    3.3.1.3. 450,000
      of the Additional Options, a third of which shall vest upon and be conditional
      upon achievement of each of the First Share Price Trigger (150,000 Additional
      Options), the Second Price Trigger (150,000 Additional Options), and the Third
      Price Trigger (150,000 Additional Options) (as each term is defined in, and
      in
      accordance with the terms of, the Merger Agreement). Provided, however, that
      the
      First Share Price Trigger, the Second Price Trigger, and the Third Price Trigger
      shall be deemed to have occurred only if such relevant Share Price shall have
      remained during
      any twenty (20) Trading Days during any thirty (30) consecutive Trading Day
      period at any time during the period commencing on the Closing and ending on
      the
      fourth anniversary thereof.. Upon
      the
fourth
      anniversary from Closing, any Additional Options not vested in accordance with
      the foregoing shall expire and be of no further effect.

     

    3.3.2. The
      foregoing vesting schedule shall be accelerated in every event where the Holders
      and the Derivative Holders (as such terms are defined in the Merger Agreement)
      shall be entitled to acceleration of the issuance of any Additional Shares
      (as
      such term is defined in the Merger Agreement).

     

    3.3.3. The
      Additional Options shall be granted pursuant to the Parent’s US employee share
      option plan. The exercise price of the Additional Options shall be US$5.00
      (five
      US dollars) per share of Parent’s Common Stock issuable upon such
      exercise.

     

    Cash
      Bonuses

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    3.3.4. In
      addition to the Additional Options, Employee shall be entitled to the following
      cash bonuses:

     

    3.3.4.1. a
      cash
      bonus in the gross amount of US $200,000 (two hundred thousand US dollars)
      upon
      achievement of the First Share Price Trigger during any twenty (20) Trading
      Days
      during any thirty (30) consecutive Trading Day period at any time during the
      period commencing on the Closing and ending on the fourth anniversary thereof
      (the “Share
      Price Bonus”).

     

    3.3.4.2. a
      cash
      bonus of the gross amount of up to US$800,000 (eight hundred thousand US
      dollars) (“Second
      Bonus”)
      upon
      the Employee becoming entitled to the Share Price Bonus under 3.3.4.1 above
      and
      the
      occurrence of any one of the following conditions, as follows: (i) if the Parent
      receives funds upon the exercise of warrants outstanding on the date of the
      Merger Agreement to acquire shares of Parent Common Stock (“Parent
      Warrants”)
      of no
      less than US$ 45 million, the Employee shall be entitled to the full amount
      of
      the Second Bonus; (ii) if the Parent’s Board calls for the cashless exercise of
      the lower of (a) all outstanding Parent Warrants, or (b) 69% of the Parent
      Warrants, the Employee shall be entitled to the full amount of the Second Bonus;
      and (iii) if Parent receives proceeds from the exercise of Parent Warrants
      in
      the amount of less than US$45 million, then a proportionate amount of the Second
      Bonus shall be payable to Employee - the sum of which shall be calculated by
      multiplying the Second Bonus by a fraction, the numerator of which shall be
      the
      amount of such proceeds and the denominator of which shall be US$45 million.
      Sums payable under (iii) above shall be calculated and payable on a quarterly
      basis and shall be deemed on account of payments due under (i) and (ii) above.
      Under no event will the aggregate amount payable to Employee under this
      subsection 3.3.4.2 exceed US$800,000.

     

    3.3.4.3. (a)
      cash
      bonuses in the gross amount of US $200,000 (two hundred thousand US dollars)
      each for the achievement of each of the (i) the Revenue Target (as defined
      in
      the Merger Agreement) during calendar year 2006; (ii) the Second Price Trigger;
      and (iii) the Third Price Trigger; (b) upon reaching the 2007 Net Profit Target,
      a cash bonus in the gross amount of US$200,000 (two hundred thousand US dollars)
      multiplied by a fraction (A) the numerator of which shall be the excess of
      Parent’s net income of the calendar year ending December 31, 2007 over
      $15,000,000 and (B) the denominator of which shall be $10,000,000. In no event
      shall the fraction in the preceding sentence exceed one (1); (c) upon reaching
      the 2008 Net Profit Target, a cash bonus in the gross amount of US$200,000
      (two
      hundred thousand US dollars) multiplied by a fraction (A) the numerator of
      which
      shall be the excess of Parent’s net income for the calendar year ending December
      31, 2008 over $20,000,000 and (B) the denominator of which shall be $25,000,000.
      In no event shall the fraction in the preceding sentence exceed one (1). The
      bonuses included in this Section shall be referred to herein as the
“Target
      Bonuses”.
       

     

    Provided,
      however that the Second Price Trigger, and the Third Price Trigger shall be
      deemed to have occurred only if such relevant Share Price shall have remained
      during
      any twenty (20) Trading Days during any thirty (30) consecutive Trading Day
      period at any time during the period commencing on the Closing and ending on
      the
      fourth anniversary thereof. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    3.4. Section
      2
      of the Employment Agreement shall be deleted and a new Section 2 shall be
      inserted and shall read as follows:

     

    2.
      TERM

     

    Corporation
      and Employee may terminate this Agreement at any time and for any reason upon
      90
      days’ prior written notice to the other party (the “Termination
      Notice”).
      

     

    In
      the
      event that (i) the Corporation terminates the Employment Agreement for any
      reason (including pursuant to Section 8.1(a) of the Employment Agreement) other
      than a termination by the Board for just cause pursuant to Section 8.1(b) of
      the
      Employment Agreement; or (ii) the Employee terminates the Employment Agreement
      for just cause pursuant to Section 8.1 (c) of the Employment Agreement, Employee
      shall be entitled to the following

     

    (a)
      Salary and benefits set forth in sections 3.1(a) as amended in this Addendum;
      3.1(b), 3.1(c), 3.1(d) and 3.1(e) under the Employment Agreement which would
      have been due to him in a twelve-month period following the furnishing of the
      Termination Notice (the “Severance
      Period”);
      and

     

    (b)
      un-expired Additional Options not yet vested as of the effective date of
      termination shall not expire and shall vest upon triggering events set forth
      in
      Section 3.3.1, if applicable, even if those occur after termination;
      and

     

    (c)
      immediate vesting upon the effective date of termination of all unvested
      Corporation Options and Corporation Shares (defined below);

     

    (d)
      extension of the exercise period of all Corporation Options and all vested
      Additional Options to the full term of said options pursuant to the relevant
      share option plan in place with regard to said options, and in the absence
      of a
      provision in the share option plan in this regard, the full term of said options
      shall be 10 years or earlier upon so called "Change of Control" events as set
      forth in the Corporation's US Share Option Plan ("Plan");
      upon a
      so called "Change of Control" event such Corporation Options and Additional
      Options shall be subject to adjustment/swap/early exercise in the same manner
      as
      other options subject to the Plan.

     

    (e)
      Target Bonuses and Annual Bonuses which would have been due to him during the
      Severance Period; In the event that such Severance Period ends prior to
      completion of any calendar year and/or prior to the publication of the financial
      statements for a given calendar year, Employee shall be entitled to the
      proportionate share of the Annual Bonus and the Target Bonuses (based upon
      a
      calculation of the applicable bonus for the entire calendar year in which the
      Severance Period ends), as the case may be, which shall be paid within the
      timeframe provided for in the Addendum. 

     

    In
      addition to the foregoing, in the event that the First Share Price Trigger
      during
      any twenty (20) Trading Days during any thirty (30) consecutive Trading Day
      period
      is
      achieved following the effective date of termination but before the lapse of
      the
      fourth anniversary from Closing, the Corporation's obligation to pay Employee
      the Share Price Bonus and the Second Bonus shall survive said terminationand
      be
      payable upon the meeting of any of the conditions set forth in Sections 3.3.4.1
      and 3.3.4.2 , as applicable. 

     

    For
      the
      avoidance of doubt the 90 day notice period set forth in the first paragraph
      of
      Section 2 shall overlap with the Severance Period. 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3.5. In
      the
      event that (i) the Board of the Corporation terminates the Employment Agreement
      of the Employee for just cause pursuant to Section 8.1(b) of the Employment
      Agreement; or (ii) the Employee terminates the Employment Agreement other than
      for just cause pursuant to Section 8.1 (c) of the Employment Agreement, then
      Employee shall only be entitled to (a) Salary and benefits set forth in sections
      3.1(a) as amended in this Addendum; 3.1(b), 3.1(c), 3.1(d) and 3.1(e) under
      the
      Employment Agreement and Annual Bonuses, Target Bonuses, Share Price Bonus,
      Second Bonus, and Additional Options (subject to vesting events and conditions
      precedent set forth in this Addendum ) which would have been due to him in
      a
      three-month period following the furnishing of the Termination Notice. Any
      Additional Options and Corporation Options vested prior to expiry of the three
      months period shall be exercisable no later than 6 months following such date
      or
      earlier upon so called "Change of Control" events as set forth in the
      Corporation's Plan; upon a so called "Change of Control" event such Corporation
      Options and Additional Options shall be subject to adjustment/swap/early
      exercise in the same manner as other options subject to the Plan. 

     

    3.6. Section
      8.1 of the Employment Agreement shall be amended by deleting Sections 8.1 (d)
      and 8.1 (e) and replacing them with the following new Section 8.1
      (d):

     

    “(d)
      In
      the event of a termination of this Employment Agreement by either party pursuant
      to Section 2 of this Employment Agreement (as amended by Section 3.4 of the
      Addendum), during the notice period provided in said Section 2 Employee shall
      cooperate with the Corporation and use his best efforts to assist the
      integration into the Corporation’s organization of the person or persons who
      will assume the Employee’s responsibilities. During the aforesaid notice period
      the employer-employee relationship shall continue.”

     

    3.7. Section
      8.2 of the Employment Agreement shall be deleted. 

     

    3.8. Pre-Closing
      Shares

     

    Immediately
      prior to the Closing, and as a bonus to Employee for his efforts in connection
      with the consummation of the transactions contemplated by the Merger Agreement,
      the Board of Directors of the Corporation shall issue to the Employee that
      number of shares of the Corporation's Common Stock, pursuant to the
      Corporation’s US Share Option Plan (the “Shares”)
      which,
      upon conversion to shares of Common Stock of the Parent shall equal 216,000
      shares of the Parent's Common Stock (the “Shares”).
      

     

    
      	 	
              3.8.1.

            	
              With
                regard to shares of Common Stock in the Corporation (the “Corporation
                Shares”)
                and options to purchase Common Stock in the Corporation (the “Corporation
                Options”),
                presently held by Employee, Employee hereby waives any acceleration
                or
                other rights pertaining to any securities held by him which may be
                triggered by the merger transaction among the
                Group.

            

    

     

    
      	 	
              3.9.

            	
              Closing
                Bonus

            

    

     

    Subject
      to the Closing, Employee shall be entitled to a one-time lump-sum bonus in
      the
      gross amount of US$220,000 (Two Hundred Twenty Thousand US dollars) payable
      immediately following the Closing (the “Closing
      Bonus”).
      Employee hereby irrevocably instructs the Corporation to deduct from the net
      amount of the Closing Bonus payable to Employee the full amount of the loan
      outstanding and owed by Employee to the Corporation, in the sum of US$110,000
      (One Hundred Ten Thousand US dollars.

     

    4. The
      provisions of this Addendum are subject to the Closing and are in amendment
      of
      the provisions of the Employment Agreement. In the event of an inconsistency
      between the provisions of the Employment Agreement and the provisions of this
      Addendum, the provisions of this Addendum shall prevail. 

     

    5. For
      the
      removal of doubt it is hereby clarified that, other than as specifically amended
      hereby, the provisions of the Employment Agreement shall remain in full force
      and effect.

     

    6. Employee
      confirms that other than an outstanding debt owed to the Employee which, as
      of
      the date of signing this Addendum amounts to $8,334(eight thousand three hundred
      thirty four US dollars), and reimbursement of expenses in the ordinary course
      of
      business, the Corporation or any of its affiliated entities has no outstanding
      debts and liabilities to the Employee arising under any relationship with the
      Corporation preceding the signing date of this Addendum and that he has no
      claims, demands and requests from the Company for any such debts and
      liabilities. For the removal of doubt, it is hereby clarified that the foregoing
      confirmation does not apply to any debt or liability that may arise following
      the date of signing of this Addendum. 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have hereby duly executed this Addendum
      on
      the day and year first set forth above.

     

    
      	IXI
              Mobile Inc.	 	/s/
              Amit Haller
	By:
              /s/ Gideon Barak	 	Amit
              Haller

    

     

    

     

    We
      agree to the above:

     

    /s/
      Israel Frieder

    Israel
      Technology Acquisition Corp.

     

    
      
        
        

      

      
        6Exhibit 10.32

                         EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement ("Agreement") is made effective this 28th
day of February 2006, by and between Delta Mutual, Inc., a Delaware Corporation
(the "Company"), and Peter F. Russo (the "Executive").

Company desires to employ Executive and Executive desires to enter into the
employ of Company in such capacity and on the terms and conditions contained in
this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties, intending to be legally bound, agree as follows:

     1. Employment.

     Company hereby agrees to employ Executive as it's President and Chief
     Executive Officer and Executive hereby accepts such employment in
     accordance with the terms of this Agreement and the terms of employment
     applicable to employees of Company, in general. In the event of any
     conflict or ambiguity between the terms of this Agreement and the terms of
     employment applicable to employees of the Company in general, the terms of
     this Agreement shall prevail. Election or appointment of Executive to
     another office or position, regardless whether such position is inferior to
     Executive's initial position, shall not be a breach of this Agreement.
     Executive hereby represents and warrants that he has the legal capacity to
     execute and perform this Agreement and that it is a valid and binding
     agreement against him according to its terms. In addition, Executive
     represents and warrants that he knows of no reason why he is not physically
     capable of performing his obligations under this Agreement in accordance
     with its terms.

     2. Duties of Executive.

     Executive shall have such powers and duties as are commensurate with those
     positions as described in the Company's bylaws and as may be assigned to
     him from time to time by the Company's Board of Directors (the "Board").
     Except for periods of illness, incapacity, vacation periods and other
     periods of authorized absence, all in accordance with Company's regular
     practice for principal executive officers. Executive shall devote all of
     his business time, attention, skills and efforts exclusively to the
     business and affairs of Company and its subsidiaries and shall perform his
     duties in a professional, ethical and business-like manner. Executive, will
     not, during the term of this Agreement, directly or indirectly engage in
     any other business, either as an employee, employer, consultant, principal,
     officer, director, advisor, or in any other capacity, either with or
     without compensation, without the prior written consent of the Company.

                                     Page 4
<PAGE>

     3.  Compensation.

     For all services rendered by Executive in any capacity required hereunder
     during the term of this Agreement, including, without limitation, services
     as an employee, officer, director, or member of any committee of Company,
     or any subsidiary, affiliate or division thereof, Executive shall be
     compensated as follows:

              A.  A fixed salary of $180,000 per year ("Base Salary"), payable
                  in accordance with the customary payroll practices of the
                  Company, but in no event less frequently than monthly.
                  Notwithstanding the previous sentence of this Paragraph 3.A.,
                  Executive agrees to accept a minimum monthly salary of $6,500
                  until such time as the financial condition of the Company (as
                  determined by the Board, in its sole discretion) permits the
                  payment of his full monthly salary of $15,000. Executive
                  agrees that the Company will record as his accrued salary the
                  difference (if any) between the actual monthly salary paid to
                  Executive and $6,500 and that the Company shall have no
                  further accrued salary liability to Executive. The Base Salary
                  shall be reviewed not later than the end of each calendar year
                  that Executive is employed by Company. Company may directly or
                  indirectly withhold from any payments made under this
                  Agreement all Federal, state, city, local or other taxes as
                  shall be required pursuant to law or governmental regulation
                  or ruling.
              B.  Bonus. Executive shall be included, in a manner consistent
                  with his position, in any bonus system, bonus pool, incentive
                  compensation, profit sharing, deferred compensation or similar
                  plan or program for its principal executive officer, senior
                  executives, officers or employees that may be implemented from
                  time to time by the Board.
              C.  Stock Options. Executive shall be included, in a manner
                  consistent with his position, in any stock option plan(s) for
                  its principal executive officer, senior executives, officers
                  and/or employees of Company in general, that may be
                  established from time to time by the Board.
              D.  Additional Benefits. Except as modified by this Agreement,
                  Executive shall be entitled to participate in the Company's
                  group health insurance plan and any other benefit plans
                  (including pension or retirement plans) as are made available
                  to its principal executive, senior executives, officers and/or
                  employees of the Company in general. Notwithstanding the
                  foregoing, nothing in this Agreement shall preclude the
                  amendment or termination of the Company's group health
                  insurance plan or any other benefit plan or program, provided
                  that such amendment or termination is applicable to all
                  employees of Company. In addition, Executive shall be entitled
                  to be paid for vacation days, sick days and holidays in
                  accordance with the Company's current paid time off policies
                  for senior executives, provided that Executive shall be
                  entitled to not less than fifteen (15) days of paid vacation
                  per calendar year during the period that this Agreement is in
                  effect. The carry-over of any unused vacation days will be
                  governed by and in accordance with Company policy. Additional
                  periods of absence due to illness, incapacity or personal
                  leave, if any, shall be granted at the discretion of the Board
                  which, in its sole discretion, may compensate Executive during
                  periods of additional absence.
              E.  Business Expenses. Company shall pay or reimburse Executive
                  for all reasonable, necessary and usual business expenses
                  incurred by Executive in connection with the performance of
                  his duties and obligations under this Agreement, subject to
                  Executive's presentation of appropriate documentation and
                  receipts and in accordance with such procedures as Company may
                  from time to time establish for its principal executive
                  officer, senior executives and/or officers, consistent with
                  the need to preserve any deductions to which Company may be
                  entitled for Federal tax purposes.

                                     Page 5
<PAGE>

     4. Term and Termination

              A.  This Agreement shall commence on March 11, 2006 and shall
                  continue in   effect for a period of three (3) years (the
                  "Term").
              B.  Termination For Cause. Company may discharge Executive at any
                  time for "Cause" which shall be defined as any of the
                  following: 1) any act of fraud, misappropriation, self
                  dealing, personal dishonesty or moral turpitude; 2) willful
                  misconduct; 3) indictment of a crime that constitutes a
                  felony; 4) breach by Executive of any of his obligations
                  regarding confidential information as set forth in Section 5
                  of this Agreement; 5) if Executive fails or refuses (through
                  habitual neglect or otherwise) to perform material assigned
                  duties; 6) if Executive engages in conduct that causes
                  material harm or damage to Company, including Company's
                  reputation or standing; 7) any material violation of Company
                  policy, that is not cured within ten (10) days after receipt
                  of written notice from Company; or 8) any material breach of
                  any provision of this Agreement. In addition to applicable
                  law, Company may discharge Executive for "Cause" in the event
                  Executive becomes physically or mentally disabled and is
                  therefore substantially unable to carry out his duties for a
                  period of 120 days or more in any twelve-month period. In the
                  event of a termination for "Cause", Company shall provide five
                  (5) days written notice to Executive ("Termination Notice")
                  and Executive shall be ineligible for any additional Base
                  Salary, severance or other payments or benefits under this
                  Agreement or otherwise after the date of termination specified
                  in the Termination Notice.
              C.  Other Termination. If Executive's employment is terminated by
                  Company for any reason other than death or for "Cause" (as
                  defined in Section 4.B.), then Company agrees to continue
                  Executive's Base Salary for six (6) months or until such time
                  as Executive commences other full-time employment, whichever
                  occurs earlier. Executive may terminate this Agreement at any
                  time providing at least sixty (60) days written notice to
                  Company ("Executive's Termination Notice"). If Executive
                  terminates this Agreement, then Company may, upon receipt of
                  Executive's Termination Notice, immediately relieve Executive
                  of all obligations and duties under this Agreement, provided
                  that Executive's then current Base Salary and benefits shall
                  continue until the termination date specified in Executive's
                  Termination Notice.
              D.  Termination For Change In Control. If Executive's employment
                  is terminated without Cause upon a consolidation, merger or
                  the sale of substantially all the assets of Company to another
                  corporation or entity in which Company is not the surviving
                  entity, then Executive shall be entitled to receive a lump sum
                  payment upon such termination equal to the greater of: 1) 100%
                  of his then current Base Salary plus 100% of his incentive
                  compensation for the prior fiscal year or 2) 100% of his then
                  current Base Salary plus 100% of his projected annual
                  incentive compensation for the remainder of the Term of this
                  Agreement, and Executive shall not be entitled to any further
                  payments pursuant to this Agreement.

         5. Other Duties During and After Term.

              A.  Confidential Information. Executive recognizes and
                  acknowledges that all information pertaining to the affairs,
                  business, clients or customers of the Company or any of its
                  subsidiaries or affiliates (any and all such entities being
                  hereinafter referred to as the "Business"), as such
                  information may exist from time to time, other than
                  information that Company has previously made publicly
                  available or which is in the public domain, is confidential
                  information and is unique and valuable asset of the Business,
                  access to and knowledge of which are essential to the
                  performance of Executive's duties under this Agreement.
                  Executive shall not divulge to any person, firm, association,
                  corporation or governmental agency, any information concerning
                  the affairs, business, clients or customers of the Business
                  (except such information as is required by law to be divulged
                  to a government agency or pursuant to lawful process), or make
                  use of any such information for his own purposes or for the
                  benefit of any person, firm, association or corporation
                  (except the Business) and shall use his reasonable and best
                  efforts to prevent the disclosure of any such information by
                  others. All records, memoranda, letters, books, papers,
                  reports, accountings, experience or other data, and other
                  records and documents relating to the Business, whether made
                  by Executive or otherwise coming into his possession, are
                  confidential information and are, shall be, and remain
                  property of the Business. No copies shall be made which are
                  not retained by the Business, and Executive agrees, on
                  termination of his employment or on demand of Company, to
                  deliver same to Company.

                                     Page 6
<PAGE>

              B.  Remedies. Company's obligation to make payments or provide for
                  any benefits under this Agreement shall cease upon a violation
                  of the preceding provision of this Section 5. Executive
                  acknowledges that Company may be severely and irreparably
                  damaged in the event Executive violates the provision of
                  Section 5.A. above, and that the extent of the damage may be
                  difficult or impossible to determine. Therefore, Executive
                  agrees that the Company shall be entitled to equitable relief,
                  including a preliminary as well as a permanent injunction
                  (without the necessity of posting bond). Executive's agreement
                  as set forth in Section 5 shall (i) continue throughout the
                  duration of Executive's employment with Company; and (ii)
                  survive Executive's termination of this Agreement and/or
                  Executive's employment with Company, whether or not such
                  termination of Executive is voluntary, is the result of
                  termination of Executive by Company with or without Cause, or
                  is the result of a change in control.

         6. Notices.

         Any notice required by this Agreement or given in connection with it,
         shall be in writing and shall be given to the appropriate party by
         personal delivery or by certified mail, postage prepaid, or recognized
         overnight delivery services;

         If to Company:

                  Delta Mutual, Inc.
                  Attn: Chief Financial Officer
                  111 North Branch Street
                  Sellersville, PA 18960

         If to Executive:

                  Peter F. Russo
                  73 Watercrest Drive
                  Doylestown, PA 18901

         7. Final Agreement.

         This Agreement supercedes all prior understandings or agreements
         (whether written or oral) between Executive and Company or any of its
         subsidiaries and affiliates and sets forth the entire understanding
         between the parties with respect to the subject matter hereof. This
         Agreement may not be modified except by written amendment duly executed
         by both parties.

         8. Governing Law.

         This Agreement shall be construed and enforced in accordance with the
laws of the State of Pennsylvania.

                                     Page 7
<PAGE>

         9. Headings.

         Headings used in this Agreement are provided for convenience only and
         shall not be used to construe meaning or intent.

         10. No Assignment.

         Neither this Agreement nor any interest in this Agreement may be
         assigned by Executive without the prior written consent of Company,
         which may be withheld by Company at Company's absolute discretion.

         11. Severability.

         If any provision of this Agreement or application thereof to anyone or
         under any circumstances is adjudicated to be invalid or unenforceable
         in any jurisdiction, then this Agreement, including all of the
         remaining terms, will remain in full force and effect as if such
         invalid or unenforceable provision had never been included.

         12. Arbitration.

         The parties agree that they will use their best efforts to amicably
         resolve any dispute arising out of or relating to this Agreement. Any
         controversy, claim or dispute that cannot be so resolved shall be
         settled by final binding arbitration in accordance with the rules of
         the American Arbitration Association and judgment upon the award
         rendered by the arbitrator or arbitrators may be entered in any court
         having jurisdiction thereof. Any such arbitration shall be conducted in
         Philadelphia, Pennsylvania, or such other place as may be mutually
         agreed upon by the parties. Within fifteen (15) days after commencement
         of the arbitration, each party shall select one person to act as
         arbitrator, and the two arbitrators so selected shall select a third
         arbitrator within ten (10) days of their appointment. Each party shall
         bear its own costs and expenses and an equal share of the arbitrator's
         expenses and administrative fees of arbitration.

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

                                           DELTA MUTUAL, INC.

                                           By: /s/ Martin G. Chilek
                                               ------------------------
                                               Martin G. Chilek
                                               Vice President and CFO

                                           EXECUTIVE

                                           By: /s/ Peter F. Russo
                                               -------------------------
                                               Peter F. Russo

                                     Page 8

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