Document:

executiveemploymenthall.htm

     

     

    EXECUTION
COPY

     

     

    EXECUTIVE
EMPLOYMENT AGREEMENT

     

    This
Executive Employment Agreement (the “Agreement”) dated as of April 1, 2008 (the
“Effective Date”), by and between Express Scripts, Inc., a Delaware corporation
(the “Company”), and Jeffery L. Hall (“Executive”).

     

    WHEREAS,
the Company agrees to employ the Executive as its Executive Vice President and
Chief Financial Officer and the Executive agrees to assume such position on the
terms and conditions set forth herein, all effective as of the Effective
Date;

     

    NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

     

    ARTICLE
I

    DEFINITIONS

     

    As used
herein, the following terms shall have the following meanings:

     

    1.1           “Accrued Rights” has
the meaning set forth in Section 4.1.

     

    1.2           “Annual Base Salary”
means the base salary set forth in Section 3.1 hereof.

     

    1.3           “Annual Bonus” means
Executive’s annual bonus granted pursuant to the Annual Bonus Plan, as described
in Section 3.2 hereof.

     

    1.4           “Annual Bonus Plan”
means the annual bonus program established for senior executives by the Board of
Directors of the Company (the “Board”) or by the Committee, as adopted or
amended from time to time.

     

    1.5           “Bonus Potential”
means the maximum bonus amount Executive could receive pursuant to Section 3.2
hereof for achieving 100% of “base” or “targeted” performance goals established
by the Board or Committee under the Annual Bonus Plan with respect to the
applicable fiscal year; provided, however, in no event
shall Executive’s Bonus Potential for the year in which the Bonus Potential is
being determined (a) be less than 70% of Executive’s Annual Base Salary as in
effect on January 1 of such year or (b) take into account, or include in any
way, any increase in Executive’s bonus amount due to the Company exceeding its
“base” or “target” goals for such year (e.g., if Executive’s “base” or “target”
Bonus Potential is stated at $50,000, but Executive is eligible to receive more
than $50,000 if certain targets are exceeded then Executive’s Bonus Potential
for purposes of this definition is $50,000).

     

    1.6           “Cause”
means:

     

    
      	
               
      

            	
              (a)

            	
              any
      act or acts by Executive, whether or not in connection with his or her
      employment by the Company, constituting, or Executive’s conviction or plea
      of guilty or nolo contendere (no contest) to, (i) a felony under
      applicable law or (ii) a misdemeanor involving moral
      turpitude;

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      act or acts of gross dishonesty or gross misconduct in the performance of
      Executive’s duties hereunder;

            

    

     

    
      	
               
      

            	
              (c)

            	
              any
      willful malfeasance or willful misconduct by Executive in connection with
      Executive’s duties hereunder or any act or omission which is materially
      injurious to the financial condition or business reputation of the Company
      or its affiliates; or

            

    

     

    
      	
               
      

            	
              (d)

            	
              any
      breach by Executive of the provisions of Sections 5.1 through 5.3 of this
      Agreement, or of the terms and provisions of the Nondisclosure and
      Noncompetition Agreement (as defined in Section 1.18
    hereof).

            

    

     

    Notwithstanding
the foregoing, the event(s) described in clause (c) of this Section 1.6 shall
not be deemed to constitute “Cause” if such event is (i) primarily the result of
bad judgment or negligence on the part of Executive not rising to the level of
gross negligence; or (ii) primarily because of an act or omission believed by
Executive in good faith to have been in, or not opposed to, the interests of the
Company and its affiliates.

     

    1.7           “Change in Control”
means a Change in Control as that term is defined in the Incentive Plan (as
defined in Section 1.16 hereof).

     

    1.8           “Code” means the
Internal Revenue Code of 1986, as amended.

     

    1.9           “Committee” means the
Compensation and Development Committee of the Board.

     

    1.10           “Covered Payments”
means the amounts described in Section 6.12(a) hereof.

     

    1.11           “Disability” has the
meaning ascribed to such term in the Incentive Plan.

     

    1.12           “Effective Date” means
the date specified in the recitals to this Agreement.

     

    1.13           “Employment Period”
means the Initial Employment Period (as defined in Section 1.17 hereof) plus any
additional Renewal Periods (as defined in Section 1.20 hereof).

     

    1.14           “Excise Tax” means the
excise tax imposed by Section 4999 of the Code or any similar state or local tax
that may be imposed.

     

    1.15           “Good Reason” means
the occurrence of any one or more of the following:

     

    (a)           Any
material breach by the Company of any of the provisions of this Agreement or any
material failure by the Company to carry out any of its obligations
hereunder;

     

    (b)           The
Company’s requiring Executive to be based at any office or location more than 50
miles from One Express Way, Saint Louis, Missouri (the “Current Headquarters”),
except for travel reasonably required in the performance of Executive’s
responsibilities to the extent substantially consistent with Executive’s
business travel obligations;

     

    (c)           Any
substantial and sustained diminution in Executive’s authority or
responsibilities from those described in Section 2.3 hereof; provided, however,
notwithstanding the foregoing, (i) in the event a Change in Control shall occur
which results in the Company becoming a subsidiary of another pharmacy benefit
management company (“PBM”), or which is in the form of a merger in which the
surviving corporation or entity is a PBM  (x) so long as Executive is
offered a position as an officer of the parent PBM (or surviving corporation or
entity) with duties and responsibilities which are not inconsistent in any
material adverse respect with his or her duties and responsibilities immediately
prior to such Change in Control, and such position is based at an office or
location not more than 50 miles from the Current Headquarters, such change in
position shall not constitute Good Reason, but (y) if Executive is not offered a
position as an officer of the parent PBM or surviving corporation or entity as
described in (x), a substantial and sustained diminution in Executive’s
authority or responsibility shall be deemed to have occurred; or (ii) in the
event a Change in Control shall occur which results in the Company becoming a
subsidiary of a non-PBM or is in the form of a merger in which the surviving
corporation or entity is not a PBM, failure to receive an offer to serve as an
officer of the non-PBM parent or surviving corporation or entity shall not
constitute Good Reason provided Executive’s duties subsequent to the Change in
Control are not inconsistent in any material adverse respect with his or her
duties immediately prior to the Change in Control, and such position is based at
an office or location not more than 50 miles from the Current
Headquarters;

     

    (d)           The
failure by the Company to continue to provide Executive with substantially
similar perquisites or benefits Executive enjoyed in the aggregate under the
Company’s benefit programs (other than long-term incentive compensation
programs), such as any of the Company’s pension, savings, vacation, life
insurance, medical, health and accident, or disability plans in which he or she
was participating at the time of any such discontinuation (or, alternatively, if
such plans are amended, modified or discontinued, substantially similar
equivalent benefits thereto in the aggregate), or the taking of any action by
the Company which would directly or indirectly cause such benefits to be no
longer substantially equivalent in the aggregate to the benefits in effect
immediately prior to taking such action; provided, that any
amendment, modification or discontinuation of any plans or benefits referred to
in this subsection (d) hereof that generally affect substantially all other
domestic salaried employees of the Company who were eligible to participate, and
participated, in the affected Company benefit program(s) shall not be deemed to
constitute Good Reason; and

     

    (e)           The
timely delivery by the Company to the Executive of notice under Section 2.2,
indicating that the Company does not desire to renew this Agreement for an
additional Renewal Period, unless the Employment Period during which such notice
is delivered is scheduled to end after the Executive has attained the age of
65;

     

    provided that the
events described in Section 1.15 (a), (b), (c) or (d) above shall only
constitute Good Reason if the Company fails to cure such event within 30 days
after receipt from Executive of written notice of the event which constitutes
Good Reason; and provided further that, “Good Reason” shall cease to exist for
an event on the 120th day following the later of its occurrence or Executive’s
knowledge thereof, unless Executive has given the Company written notice thereof
prior to such date.

     

    1.16           “Incentive Plan” means
the Express Scripts, Inc. 2000 Long-Term Incentive Plan, as amended from time to
time.

     

    1.17           “Initial Employment
Period” has the meaning set forth in Section 2.2 hereof.

     

    1.18           “Nondisclosure and
Noncompetition Agreement” means the Form of Nondisclosure and
Noncompetition Agreement entered into by and between Executive and the Company
dated as of April 1, 2008.

     

    1.19           “Payment Cap” means
the maximum amount described in Section 6.12(b) hereof.

     

    1.20           “Renewal Period” has
the meaning set forth in Section 2.2 hereof.

     

    1.21           “Retirement” means the
voluntary termination of employment by Executive on or after attaining age 59
1/2.

     

    1.22           “Severance Benefit”
means a severance payment in an amount equal to:

     

    (a)           eighteen
(18) months of Executive’s Annual Base Salary as in effect immediately prior to
the Termination Date, plus

     

    (b)           an
amount equal to one hundred fifty percent (150%) of the product of (i)
Executive’s Bonus Potential for the year in which the Termination Date occurs
(the “Termination Year”), multiplied by (ii) the average percentage of the Bonus
Potential earned by the Executive for the three (3) full years immediately
preceding the Termination Year, (or such shorter period if Executive was
employed by the Company for less than three (3) full years and received, or was
eligible to receive, a bonus during such period), which product shall be
prorated for the portion of the Termination Year in which Executive was employed
by the Company; provided, however, that such product shall not be prorated if
the Termination Date occurs within one year following a Change in Control Date
(as defined in the Incentive Plan).  Notwithstanding anything to the
contrary herein, neither the three-year average percentage of Bonus Potential
described in (ii) above, nor the percentage of Bonus Potential for any single
year used to compute such three-year average, may exceed 100%; provided,
however, that there shall be no such 100% maximum for the three year average, or
for any single year, if the Termination Date occurs within one year following a
Change in Control Date.

     

    1.23           “Tax Reimbursement
Payment” means the payment described in Section 6.12(c)
hereof.

     

    1.24           “Termination Date”
means the effective date of termination of Executive’s employment as determined
in accordance with Section 4.5 hereof.

     

    1.25           “Welfare Benefit” has
the meaning set forth in Section 4.2.

     

    ARTICLE
II

    TERM/POSITION

     

    2.1           Employment; Effectiveness of
Agreement.  Effective as of the Effective Date, the Company
hereby employs Executive, and Executive hereby accepts such employment,
according to the terms and conditions set forth in this Agreement.

     

    2.2           Term.  Subject
to the provisions of Sections 4.1 through 4.5 of this Agreement, the term of
Executive’s employment hereunder shall commence on the Effective Date and
continue through March 31, 2009 (the “Initial Employment Period”).  On
April 1 of each year, commencing with April 1, 2009,  and on each
subsequent April 1 thereafter (each, an “Anniversary Date”), this Agreement
shall be extended automatically at such time for an additional twelve (12) month
period (each, a “Renewal Period”) unless either party hereto delivers written
notice in accordance with Section 6.2 hereof to the other party hereto at least
90 days prior to such Anniversary Date of his, her or its desire not to renew
this Agreement for an additional Renewal Period.  (e.g. Subject to the terms
hereof, assuming an April 1 Anniversary Date, and an employment period (Initial
or Renewal) of April 1, 2008 through March 31, 2009, if either party gives
proper notice at least 90 days prior to April 1, 2009 then the Agreement shall
terminate as of March 31, 2009, but if neither party gives proper notice at
least 90 days prior to April 1, 2009 then the Agreement shall automatically
renew for an additional Renewal Period of April 1, 2009 through March 31,
2010.)  The Initial Employment Period and any Renewal Periods, if any,
shall constitute the “Employment Period” for purposes of this
Agreement.  If there are no Renewal Periods, then the Employment
Period shall have the same meaning as Initial Employment
Period.  Except as set forth in Section 6.1 hereof, upon termination
of Executive’s employment with the Company in accordance with the terms hereof
or upon termination of the Initial Employment Period or the Employment Period
without extension thereof, this Agreement shall terminate and no longer be of
any force or effect.

    

    2.3           Position and
Duties.  Executive shall hold the position of Executive Vice
President and Chief Financial Officer and shall report to, and at all times be
subject to the lawful direction of, the Chief Executive Officer of the Company.
Additionally, Executive shall serve as a member of the executive staff and
participate in the strategic decision-making of the Company from time to time.
During the Employment Period, Executive shall devote his or her best efforts and
his or her full business time and attention (except for permitted vacation
periods and reasonable periods of illness or other incapacity) to the business
affairs of the Company. Executive shall perform his or her duties and
responsibilities to the best of his or her abilities in a diligent, trustworthy,
businesslike and efficient manner. Nothing herein shall preclude Executive from,
(a) subject to the prior written consent of the Board, or an appropriate
committee of the Board, serving on any for-profit corporate or governmental
board of directors (b) serving on the board of, or working for, any charitable,
not-for-profit or community organization, (c) pursuing his or her personal,
financial and legal affairs, or (d) pursuing any other activity; provided that
Executive shall not engage in any other business, profession, occupation or
other activity, for compensation or otherwise, which would violate the
provisions of Section 5.1 or would, in each case, and in the aggregate,
otherwise conflict or interfere with the performance of Executive’s duties and
responsibilities hereunder, either directly or indirectly, without the prior
written consent of the Board or an appropriate committee of the
Board.

    

    ARTICLE
III

    COMPENSATION
AND BENEFITS

     

    3.1           Annual Base
Salary.  During the Employment Period, the Company shall pay
Executive a base salary (the “Annual Base Salary”) at the annual rate of Four
Hundred Fifty Thousand Dollars ($ 450,000), which shall be payable in regular
installments in accordance with the Company’s usual payroll practices and shall
be subject to deductions for customary withholdings, including, without
limitation, federal, state and local withholding taxes, social security taxes
and Medicare taxes. Executive shall be eligible for such merit-based increases
in Executive’s Annual Base Salary, if any, as may be determined from time to
time in the sole discretion of the Board or the Committee; provided that any
such increase shall not serve to limit or reduce any other obligation to
Executive under this Agreement. The term “Annual Base Salary” as used in this
Agreement shall refer to the Annual Base Salary as in effect from time to time
during the Employment Period. Executive’s Annual Base Salary shall not be
reduced after any such increase without Executive’s express written
consent.

     

    3.2           Annual Incentive
Compensation.  Executive shall be eligible to participate in
the Company’s Annual Bonus Plan established for senior executives by the Board
or the Committee. The size of Executive’s bonus opportunity, which for any
calendar year shall be no less than 70% of Executive’s Annual Base Salary as in
effect on January 1 of such year, and the terms of Executive’s participation in
the Annual Bonus Plan shall be determined based on the terms and conditions of
the Annual Bonus Plan, subject to adjustment as described therein, and in
accordance with any bonus award agreement thereunder.  Executive’s
Annual Bonus shall be subject to deductions for customary withholdings,
including, without limitation, federal, state and local withholding taxes,
social security taxes and Medicare taxes

     

    3.3           Participation in Benefit
Plans.  During the Employment Period, Executive shall be
entitled to participate in the Company’s employee benefit plans (other than
bonus and incentive plans) as in effect from time to time, on the same basis as
those benefits are generally made available to similarly situated senior
executives of the Company.

     

    3.4           Restricted Stock, Stock
Options and Other Equity Awards and Deferred
Compensation.  Executive may receive restricted stock, stock
options and other equity awards and deferred compensation, to the extent
determined by the Company, Board or Committee, as applicable, from time to
time.  The terms of any such award shall be documented in a separate
award notice or agreement.

     

    3.5           Business
Expenses.  During the Employment Period, Executive shall be
reimbursed for all reasonable expenses incurred by him or her in performing his
or her duties hereunder provided that such expenses are incurred and accounted
for in accordance with the policies and procedures established by the
Company.

     

    3.6           Perquisites.  During
the Employment Period, Executive shall be entitled to receive such perquisites
and fringe benefits which similarly situated executives of the Company are
entitled to receive and such other perquisites which are suitable to the
character of Executive’s position with the Company and adequate for the
performance of Executive’s duties hereunder.

     

    ARTICLE
IV

    TERMINATION
OF EMPLOYMENT

     

    4.1           Termination by the Company
for Cause; Termination by Executive Other Than for Good Reason or
Retirement.  If the Employment Period and Executive’s
employment under this Agreement is terminated by the Company for Cause or by
Executive other than for Good Reason or Retirement, prior to the scheduled
expiration of the Employment Period, Executive shall be entitled to
receive:

     

    (a)           The
Annual Base Salary through the Termination Date;

     

    (b)           Reimbursement
for any unreimbursed business expenses properly incurred by Executive in
accordance with Company policy prior to the Termination Date; and

     

    (c)           Such
employee benefits, if any, to which Executive may be entitled under the employee
benefit plans of the Company, including rights with respect to any restricted
stock, stock option and other equity awards or any deferred compensation,
subject to the terms and conditions of the applicable plan, award, agreement or
notice, if relevant (the amounts described in clauses (a) through (c) hereof
being referred to as the “Accrued Rights”).

     

    Following
such termination of Executive’s employment hereunder pursuant to this Section
4.1, Executive shall have no further rights to any compensation or any other
benefits under this Agreement.

     

    4.2           Termination by the Company
Other Than for Cause or Disability; Termination by Executive for Good
Reason.

     

    (a)           If
the Employment Period and Executive’s employment under this Agreement is
terminated by the Company prior to the scheduled expiration of the Employment
Period other than for Cause or Disability, or Executive terminates his or her
employment prior to the end of the Employment Period for Good Reason, Executive
shall be entitled to receive:

     

    (i)       The
Accrued Rights;

     

    (ii)       Any
Annual Bonus earned for a previously completed fiscal year but unpaid as of the
Termination Date, which Annual Bonus shall be payable to the extent the
corporate bonus pool is approved by the Committee;

     

     (iii)  A
Severance Benefit pursuant to the terms and conditions set forth in Section
4.2(b) below; and

     

    (iv)  The
Company will reimburse the Executive for Executive’s cost of continuing medical
insurance under COBRA, or, following the expiration of the COBRA period,
equivalent medical insurance coverage, for Executive, Executive’s spouse and any
eligible dependents of Executive until the earlier of (A) eighteen (18) months
after the Termination Date, or (B) such time as Executive becomes eligible for
group insurance from another employer (the “Welfare Benefit”).

     

    (b)           The
Company shall pay the Severance Benefit, without interest thereon, in eighteen
(18) substantially equal monthly installments, which installments shall be
payable on the first day of each month, with the first installment payable in
the first full month commencing fifteen (15) days after the Termination
Date.  Notwithstanding the foregoing, in the event that Executive is
determined to be a specified employee in accordance with Section 409A of the
Code and the regulations and other guidance issued thereunder for purposes of
the Severance Benefit, the Severance Benefit shall begin on the first payroll
date which is more than six months following the date of his or her separation
from service; provided, that this sentence shall apply only to the extent
required to avoid Executive's incurrence of any additional tax or interest under
Section 409A of the Code or any regulations or Treasury guidance promulgated
thereunder.  Payment of the Severance Benefit is subject to deductions
for customary withholdings, including, without limitation, federal, state and
local withholding taxes, social security taxes and Medicare taxes. Executive
shall not be under any duty to mitigate damages in order to be eligible to
receive the Severance Benefit.

     

    (c)           Notwithstanding
the foregoing, Executive agrees that payment of the Severance Benefit is
contingent upon the following:

     

    (i)           In
the event of breach by Executive of Sections 5.1 through 5.3 hereof (or any
breach of any agreements in the release described in Section 4.2(c)(ii) below,
or in the Nondisclosure and Noncompetition Agreement), Executive shall reimburse
the Company for all compensation or other amounts previously paid, allocated,
accrued, delivered or provided by the Company to Executive pursuant to Section
4.2 (a)(ii) hereof and the Company shall be entitled to discontinue the future
payment, delivery, allocation, accrual or provision of the Severance Benefit,
the Welfare Benefit, and such other compensation, including any deferred or
equity compensation, as reflected in the terms of any plan, notice or agreement
evidencing such other compensation, except to the extent prohibited by
applicable law.

     

    (ii)           No
later than thirty (30) days after the Termination Date, Executive must execute
and deliver a general release releasing all claims against the Company (other
than those specifically described in the below proviso) in such form and
containing such terms as the Company may reasonably prescribe; provided, however, that it
shall not be a condition to the Executive’s receipt of the Severance Benefit
that the Executive release the Company from any of the following:

     

    (A)           the
obligations of the Company described in Article IV of the Agreement;
or

     

    (B)           any
vested rights that the Executive may have with respect to any benefits, rights
or entitlements under the terms of any employee benefit programs of the Company
to which the Executive is or will be entitled by virtue of his or her employment
with the Company or any of its subsidiaries, and nothing in the release will
prohibit or be deemed to restrict the Executive from enforcing his or her rights
to any such benefits, rights or entitlements; or

     

    (C)           the
Executive’s right to indemnification to the extent provided in the Company’s
Certificate of Incorporation and/or bylaws.

     

    Following
such termination of Executive’s employment hereunder pursuant to this Section
4.2, Executive shall have no further rights to any compensation or any other
benefits under this Agreement.

     

    4.3           Termination Due to Death,
Disability or Retirement.  If the Employment Period and
Executive’s employment under this Agreement are terminated due to Executive’s
death, Disability or Retirement prior to the scheduled expiration of the
Employment Period, Executive or Executive’s estate, as applicable, will receive
(a) the Accrued Rights plus any Annual Bonus earned for a previously completed
fiscal year but unpaid as of the Termination Date which Annual Bonus shall be
payable to the extent the corporate bonus pool is approved by the Committee;
provided, however, that, in the event of Executive’s death, the Company agrees
to abide by previously received written instructions from the Executive
directing the Company to pay the Accrued Rights and/or the accrued but unpaid
Annual Bonus to a living trust or similar estate planning vehicle of Executive,
provided such trust or similar vehicle is still in existence at the time of
Executive’s death, except to the extent prohibited by law, and except as may
otherwise be required or directed by any applicable employee benefit plan; and
(b) reimbursement for the Welfare Benefit.  Following such termination
of Executive’s employment hereunder pursuant to this Section 4.3, Executive
shall have no further rights to any compensation or any other benefits under
this Agreement.  Further, notwithstanding the specific terms of the
Incentive Plan, with respect to any grants made to the Executive under the
Incentive Plan during the term of this Agreement, a proper Retirement by
Executive under this Agreement shall be deemed to be a Retirement under the
Incentive Plan.

    

    4.4           Expiration of the Employment
Period.

    

    (a)           In
the event either party elects not to extend the Employment Period pursuant to
Section 2.2, unless Executive’s employment is earlier terminated pursuant to
Sections 4.1 through 4.3, Executive’s term of employment hereunder (whether or
not Executive continues as an employee of the Company thereafter) shall be
deemed to close on the close of business on the day immediately preceding the
next scheduled Anniversary Date and Executive shall be entitled to receive the
Accrued Rights, plus any Annual Bonus earned for a previously completed fiscal
year  (including a fiscal year which ends on the on the Termination
Date) but unpaid as of the Termination Date, which Annual Bonus shall be payable
to the extent the corporate bonus pool is approved by the
Committee.

     

    (b)           Unless
the parties otherwise agree in writing executed subsequent to the Effective
Date, continuation of Executive’s employment with the Company beyond the
expiration of the Employment Period shall be deemed an employment at-will and,
subject only to Section 6.1, shall not be deemed to extend any of the provisions
of this Agreement and Executive’s employment may thereafter be terminated at
will by either Executive or the Company.

     

    Following
such termination of Executive’s employment hereunder pursuant to this Section
4.4, Executive shall have no further rights to any compensation or any other
benefits under this Agreement.

     

    4.5           Notice of
Termination.  For purposes of this Agreement, any purported
termination of Executive’s employment by the Company or by Executive, shall be
communicated by written “Notice of Termination” to the other party hereto in
accordance with Section 6.2 hereof. Any Notice of Termination shall set forth
(a) the effective date of termination (for purposes of determining Executive’s
entitlement to benefits hereunder), which, in the case of a termination by
Executive pursuant to Section 4.1, a termination by either party pursuant to
Section 4.2, or a Termination by Executive for Retirement pursuant to Section
4.3 shall not be less than fifteen (15) days after the date the Notice of
Termination is delivered; (b) the specific provision in this Agreement relied
upon; and (c) in reasonable detail, the facts and circumstances claimed to
provide a basis for such termination.  If the Company terminates
Executive’s employment pursuant to Section 4.1 or due to Executive’s Disability
pursuant to Section 4.3 hereof, the Termination Date shall be the date upon
which the Company notifies Executive of such termination. If the Company
terminates Executive’s employment pursuant to Section 4.2, or if Executive
terminates employment pursuant to Section 4.1, 4.2 or 4.3 hereof, the
Termination Date shall be Executive’s last full day of work prior to the
effectiveness of such termination.  If the Agreement is terminated
pursuant to Section 4.4, the Termination Date shall be the last day of the
Initial Employment Period or the last Renewal Period, as applicable.
Notwithstanding the foregoing, if within fifteen (15) days after any Notice of
Termination is given, the party receiving such Notice of Termination notifies
the other party that a good faith dispute exists concerning the termination, the
“Termination Date” for purposes of determining the Executive’s entitlement to
benefits under this Agreement shall be the date on which the dispute is finally
determined by an independent arbitrator selected by the American Arbitration
Association.

     

    4.6           Board/Committee
Resignation.  Upon termination of Executive’s employment for
any reason, Executive agrees to resign, as of the Termination Date and to the
extent applicable, from the Board (and any committees thereof) and the Board of
Directors (and any committees thereof) of any of the Company’s
affiliates.

     

    ARTICLE
V

    RESTRICTIVE
COVENANTS

     

    For the
purposes of this Article V, all references to the Company shall include the
Company and its affiliates.

     

    5.1           Non-Solicitation and
Non-Competition.

     

    (a)           Executive
acknowledges and recognizes the highly competitive nature of the businesses of
the Company and its affiliates and accordingly agrees as follows:

     

    (i)           During
the period of Executive’s employment with the Company and, for a period of two
(2) years  after termination of Executive’s employment (the
“Nonsolicit Period”), Executive will not, whether on Executive’s own behalf or
on behalf of or in conjunction with any person, firm, partnership, joint
venture, association, corporation or other business organization, entity or
enterprise whatsoever (“Person”), directly or indirectly solicit or assist in
soliciting in competition with the Company, the business of any client or
prospective client:

     

    (1)           with
whom Executive had personal contact or dealings on behalf of the Company during
the one (1) year period preceding Executive’s termination of
employment;

     

    (2)           with
whom employees reporting to Executive have had personal contact or dealings on
behalf of the Company during the one (1) year immediately preceding the
Executive’s termination of employment; or

     

    (3)           for
whom Executive had direct or indirect responsibility during the one (1) year
immediately preceding Executive’s termination of employment.

     

    (ii)           During
the Nonsolicit Period, Executive will not, whether on Executive’s own behalf or
on behalf of or in conjunction with any Person, directly or
indirectly:

     

    (1)           solicit
or encourage any employee of the Company or its affiliates to leave the
employment of the Company or its affiliates; or

     

    (2)           hire
any such employee who was employed by the Company or its affiliates as of the
date of Executive’s termination of employment with the Company or who left the
employment of the Company or its affiliates coincident with, or within one year
prior to or after, the termination of Executive’s employment with the
Company.

     

    (iii)          During
the Nonsolicit Period, Executive will not, directly or indirectly, solicit, or
encourage to cease to work with the Company or its affiliates, any consultant
then under contract with the Company or its affiliates.

     

    (iv)          During
the period of Executive’s employment with the Company and, for a period of (18)
months after termination of Executive’s employment for any reason (the
“Noncompete Period”), Executive will not directly or indirectly:

     

    (1)           engage
in any business that is, or will be, engaged wholly or primarily in the business
of manufacturing, purchasing, selling or supplying in the United States any
product or service manufactured, purchased, sold, supplied or provided by the
Company or its affiliates, and which is or will be directly in competition with
the business of the Company or its affiliates (including, without limitation,
businesses which the Company or its affiliates have specific plans to conduct in
the future and as to which Executive is aware of such planning) in the United
States (a “Competitive Business”);

     

    (2)           enter
the employ of, or render any services to, any Person (or any division or
controlled or controlling affiliate of any Person) who or which engages in a
Competitive Business;

     

    (3)           acquire
a financial interest in, or otherwise become actively involved with, any
Competitive Business, directly or indirectly, as an individual, partner,
shareholder, officer, director, principal, agent, trustee or consultant;
or

     

    (4)           interfere
with, or attempt to interfere with, business relationships (whether formed
before, on or after the date of this Agreement) between the Company or any of
its affiliates and customers, clients, suppliers, partners, members or investors
of the Company or its affiliates.

     

    (v)          Notwithstanding
anything to the contrary herein, Executive may, directly or indirectly own,
solely as an investment, securities of any Person engaged in the business of the
Company or its affiliates which are publicly traded on a national or regional
stock exchange or on the over-the-counter market if Executive (i) is not a
controlling person of, or a member of a group which controls, such Person and
(ii) does not, directly or indirectly, own 5% or more of any class of
securities of such Person.

     

    5.2           Confidentiality.

     

    (a)           Executive
acknowledges that the identity of the clients and customers of the Company, the
prices, terms and conditions at, or upon which, the Company sells its products
or provides its services and other non-public, proprietary or confidential
information relating to the business, financial and other affairs of the Company
(including, without limitation, any idea, product, trade secret, know-how,
research and development, software, databases, inventions, processes, formulae,
technology, designs and other intellectual property; creative or conceptual
business or marketing plan, strategy or other material developed for the Company
by Executive; or information concerning finances, investments, profits, pricing,
costs, products, services, vendors, customers, clients, partners, investors,
personnel, compensation, recruiting, training, advertising, sales, marketing,
promotions, government and regulatory activities and approvals -- concerning the
past, current or future business, activities and operations of the Company or
its affiliates and/or any third party that has disclosed or provided any of same
to the Company on a confidential basis) (hereinafter collectively referred to as
“Confidential Information”) are valuable, special unique assets of the Company
and that such Confidential Information, if disclosed to others, may result in
loss of business or other irreparable and consequential damage to the
Company.

     

    (b)           Executive
shall hold in fiduciary capacity, for the benefit of the Company, all
Confidential Information and shall not, at any time during the Employment Period
or thereafter (i) retain or use for the benefit, purposes or account of
Executive of any other Person, or (ii) disclose, divulge, reveal, communicate,
share, transfer or provide access to any Person outside the Company (other than
its professional advisers who are bound by confidentiality obligations), any
Confidential Information, without the prior written authorization of the
Company.

     

    (c)           Notwithstanding
the foregoing, the term Confidential Information shall not include information
(i) generally known to the public or the trade other than as a result of
Executive’s breach of this covenant or any breach of other confidentiality
obligations by third parties, (ii) made legitimately available to Executive by a
third party without breach of any confidentiality obligation, (iii) the release
of which is deemed by the Board to be in the best interest of the Company, or
(iv) the disclosure of which is required by applicable law; provided that
Executive shall give prompt written notice to the Company of such legal
requirement, disclose no more information than is so required, and cooperate
with any attempts by the Company to obtain a protective order or similar
treatment.

     

    (d)           Notwithstanding
anything herein to the contrary, any party to this Agreement (and any employee,
representative, or other agent of any party to this Agreement) may disclose to
any and all persons, without limitation of any kind, the tax treatment and tax
structure of the transactions contemplated by this Agreement and all materials
of any kind (including opinions or other tax analyses) that are provided to it
relating to such tax treatment and tax structure.  However, any such
information relating to the tax treatment or tax structure is required to be
kept confidential to the extent necessary to comply with any applicable federal
or state securities laws.

     

    (e)           Upon
termination of Executive’s employment with the Company for any reason, Executive
shall (i) cease and not thereafter commence use of any Confidential Information
or intellectual property (including without limitation, any patent, invention,
copyright, trade secret, trademark, trade name, logo, domain name or other
source indicator) owned or used by the Company or its affiliates, (ii)
immediately destroy, delete, or return to the Company, at the Company’s option,
all originals and copies in any form or medium (including memoranda, books,
papers, plans, computer files, letters and other data) in Executive’s possession
or control (including any of the foregoing stored or located in Executive’s
office, home, laptop or other computer, whether or not Company property) that
contain Confidential Information or otherwise relate to the business of the
Company or its affiliates, except that Executive may retain only those portions
of any personal notes, notebooks and diaries that do not contain any
Confidential Information, and (iii) notify and fully cooperate with the Company
regarding the delivery or destruction of any other Confidential Information of
which Executive is or becomes aware.

     

    5.3           Non-Disparagement.  Executive
agrees that Executive will not disparage the Company or its affiliates, or its
or their current or former officers, directors, and employees in any way;
further, Executive will not make or solicit any comments, statements, or the
like to the media or to others that would be considered derogatory or
detrimental to the good name or business reputation of any of the aforementioned
entities or individuals; provided, that this Section does not prohibit
statements which Executive is required to make under oath or which are otherwise
required by law, provided that such statements are truthful and made in a
professional manner; further provided that this Section does not prohibit
Executive from making statements which would otherwise be in violation of this
Section, provided such statements are made by Executive in response to public
statements made by the Company, or its authorized representatives, which are
derogatory or detrimental to the good name or business reputation of the
Executive.

     

    5.4           Acknowledgment of Reasonable
Covenants.  It is expressly understood and agreed that
Executive and the Company consider the restrictions and covenants contained
herein to be reasonable and enforceable, because, among other things, (a)
Executive will be receiving compensation under this Agreement or otherwise, (b)
there are many other areas in which, and companies for which, Executive could
work in view of Executive’s background, (c) the restrictions and covenants set
forth herein do not impose any undue hardship on Executive, (d) the Company
would not have entered into this Agreement but for the restrictions and
covenants of Executive contained herein, and (e) the restrictions and covenants
contained herein have been made in order to induce the Company to enter into
this Agreement.

     

    5.5           Modification of the
Restrictive Covenants.  If, at the time of enforcement of the
restrictive covenants set forth herein, a final judicial determination is made
by a court or arbiter of competent jurisdiction that the time or territory or
any other restriction contained in this Agreement is an unenforceable
restriction against Executive, the provisions of this Agreement shall not be
rendered void but shall be deemed amended to apply as to such maximum time and
territory and to such maximum extent as such court may judicially determine or
indicate to be enforceable.  Alternatively, if any court of competent
jurisdiction finds that any restriction contained in this Agreement is
unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.

     

    ARTICLE
VI

    MISCELLANEOUS

     

    6.1           Survival.  Sections
4.1 through 4.6 inclusive (as applicable to the relevant circumstance of
termination only), 5.1 through 5.5 inclusive and 6.1 through 6.14 inclusive
shall survive and continue in full force in accordance with their terms
notwithstanding any termination of Executive’s employment hereunder or
termination of the Initial Employment Period or the Employment
Period.

     

    6.2           Notices.  All
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Agreement shall be in writing and shall be
deemed to have been given when delivered personally, mailed by certified or
registered mail, return receipt requested and postage prepaid, or sent via a
nationally recognized overnight courier, or sent via facsimile to the recipient.
Such notices, demands and other communications shall be sent to the address
indicated below:

     

    To the
Company:

     

    Express
Scripts, Inc.

    One
Express Way

    Saint
Louis, MO 63121

    Attention:
Chief Executive Officer

     

    To
Executive:

    Jeffery
L. Hall

    2204
Heritage Drive

    San Jose,
CA  95124

    

    or such
other address or to the attention of such other person as the recipient party
shall have specified by prior written notice to the sending party.

     

    6.3           Severability.  Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability shall not affect any other provision or any other jurisdiction,
but this Agreement shall be reformed, construed and enforced in such
jurisdiction as if such invalid, illegal or unenforceable provision had never
been contained herein.

     

    6.4           Complete
Agreement.  This Agreement constitutes the complete agreement
and understanding between the parties regarding the subject matter hereof and
supersedes and preempts any prior understandings, agreements or representations
by and between the parties, written or oral, including, without limitation, the
Prior Agreement, which shall automatically terminate upon the effectiveness of
this Agreement; provided, however, that this
Agreement shall not supersede or modify the terms of the Nondisclosure and
Noncompetition Agreement, and any restricted stock, stock options or other
equity awards or deferred compensation shall be subject to the terms of the
applicable notices or agreements; and provided further,
however that
this Agreement shall not supersede or modify the terms of any equity awards or
special bonus awards (i.e. bonuses other than the Annual Bonus) specifically
granted under the Prior Agreement.  The applicable provisions of this
Agreement amend the terms and provisions of the Incentive Plan to the extent
addressed by this Agreement, as the same may have been amended prior to the date
hereof, with respect to awards covered by this Agreement and made to Executive
hereunder.

     

    6.5           Counterparts.  This
Agreement may be executed in separate counterparts, each of which is deemed to
be an original and all of which taken together constitute one and the same
agreement.

     

    6.6           Successors and
Assigns.  Except as otherwise provided herein, all covenants
and agreements contained in this Agreement shall bind and inure to the benefit
of and be enforceable by the Company and its respective successors and assigns.
Except as otherwise specifically provided herein, this Agreement, including the
obligations and benefits hereunder, may not be assigned to any party by
Executive.

     

    6.7           No Strict
Construction.  The language used in this Agreement shall be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction shall be applied to this
Agreement.

     

    6.8           Descriptive
Headings.  The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this
Agreement.

     

    6.9           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Missouri, without regard to conflicts
of laws principles thereof; provided, however, that issues
related to the Incentive Plan or any grants thereunder shall be resolved in
accordance with the laws of the State of Delaware.

     

    6.10           Specific
Performance.  The Company shall be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs
(including reasonable attorneys’ fees) caused by any breach of any provision of
this Agreement and to exercise all other rights existing in its favor. The
Executive agrees and acknowledges that money damages are an inadequate remedy
for any breach of the provisions of this Agreement, including, without
limitation, Sections 5.1 through 5.3 hereof, and that the Company shall be
entitled to apply to any court of law or equity of competent jurisdiction
(without posting any bond or deposit) for specific performance and/or other
injunctive relief in order to enforce or prevent any violations of the
provisions of this Agreement. Further, Executive acknowledges that the
forfeiture provision set forth in the termination provisions hereof shall not be
construed to limit or otherwise affect the Company’s right to seek legal or
equitable remedies it may otherwise have, or the amount of damages for which it
may seek recovery, resulting from breach of this Agreement.

     

    6.11           Amendment and
Waiver.  The provisions of this Agreement may be amended and
waived only with the prior written consent of the Company and
Executive.

     

    6.12           Tax
Matters.

     

    (a)           Notwithstanding
anything to the contrary herein (or any other agreement entered into by and
between Executive and the Company or any incentive arrangement or plan offered
by the Company), in the event that any amount or benefit paid or distributed to
Executive pursuant to this Agreement, taken together with any amounts or
benefits otherwise paid or distributed to Executive by the Company or any of its
subsidiaries (collectively, the “Covered Payments”), would constitute an “excess
parachute payment” as defined in Section 280G of the Code, and would thereby
subject Executive to an Excise Tax, the provisions of this Section 6.12 shall
apply.

     

    (b)           If
the aggregate present value (as determined for purposes of Section 280G of the
Code) of the Covered Payments exceeds the amount which can be paid to Executive
without Executive incurring an Excise Tax, but is less than 125% of such amount,
then the amounts payable to Executive under this Agreement (or any other
agreement by and between Executive and the Company or pursuant to any incentive
arrangement or plan offered by the Company) may, in the discretion of the
Company, be reduced (but not below zero) to the maximum amount which may be paid
hereunder without Executive becoming subject to the Excise Tax (such reduced
payments to be referred to as the “Payment Cap”). In the event Executive
receives reduced payments and benefits as a result of application of this
Section 6.12, Executive shall have the right to designate which of the payments
and benefits otherwise set forth herein (or any other agreement between
Executive and the Company or any incentive arrangement or plan offered by the
Company) will be received in connection with the application of the Payment Cap,
subject to the following sentence.  Reduction shall first be made from
payments and benefits which are determined not to be nonqualified deferred
compensation for purposes of Section 409A of the Code, and then shall be made
(to the extent necessary) out of payments and benefits which are subject to
Section 409A of the Code and which are due at the latest future
date.

     

    (c)           If
the aggregate present value of all Covered Payments is equal to or exceeds 125%
of the amount which can be paid to Executive without Executive incurring an
Excise Tax, Executive shall be entitled to receive an additional amount (the
“Tax Reimbursement Payment”) such that the net amount retained by Executive with
respect to such Covered Payments, after deduction of any Excise Tax on the
Covered Payments and any federal, state and local income tax and Excise Tax on
the Tax Reimbursement Payment provided for by this Section 6.12, but before
deduction for any federal, state or local income or employment tax withholding
on such Covered Payments, shall be equal to the amount of the Covered
Payments.  Such additional amount may be paid by the Company directly
to the applicable taxing authority.  The Tax Reimbursement Payment
shall be paid in the calendar year following the date of the Change in
Control.

     

    (d)           Immediately
upon a Change in Control, the Company shall notify Executive of any modification
or reduction as a result of the application of this Section 6.12. In the event
Executive and the Company disagree as to the application of this Section 6.12,
the Company shall select a law firm or accounting firm from among those
regularly consulted (during the twelve-month period immediately prior to the
Change in Control that resulted in the characterization of the Covered Payments
as parachute payments) by the Company, and such law firm or accounting firm
shall determine, at the Company’s expense, the amount to which Executive shall
be entitled hereunder (and pursuant to any other agreements, incentive
arrangements or plans), taking into consideration the application of this
Section 6.12, and such determination shall be final and binding upon Executive
and the Company.

     

    6.13           Executive
Representation.  Executive hereby represents to the Company
that the execution and delivery of this Agreement by Executive and the Company
and the performance by Executive of Executive’s duties hereunder shall not
constitute a breach of, or otherwise contravene, the terms of any employment
agreement or other agreement or policy to which Executive is a party or
otherwise bound.

     

    6.14           Cooperation.  Each
party shall provide reasonable cooperation in connection with any action or
proceeding (or any appeal from any action or proceeding) which relates to events
occurring during Executive’s employment hereunder.

     

    6.15           Section 409A of the
Code.  Notwithstanding anything to the contrary in this
Agreement, the parties mutually desire to avoid adverse tax consequences
associated with the application of Section 409A of the Code to this Agreement
and agree to cooperate fully and take appropriate reasonable actions to avoid
any such consequences under Section 409A of the Code, including delaying
payments and reforming the form of the Agreement if such action would reduce or
eliminate taxes and/or interest payable as a result of Section 409A of the
Code.

     

    6.16           Arbitration.  Executive
and the Company agree that any and all disputes between the parties hereto
arising from or relating to this Agreement, and/or any release executed by
Executive pursuant to the terms of this Agreement, shall be submitted and
decided by binding arbitration before a single arbitrator in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (“AAA”)
then in effect.  Venue for the arbitration shall be in St. Louis
County, Missouri and the laws of the State of Missouri will
apply.  Any demand for arbitration shall be made within a reasonable
time after the claim, dispute, or other matter in question has arisen, and in no
event shall any such demand be made after the date when institution of legal of
equitable proceedings based on such claim, dispute or other matter in question
would be barred by the applicable statute of limitations. Under no circumstances
will either party be subject to punitive damages.  Each party hereto
shall bear its costs of the arbitration proceeding. However, the prevailing
party in the arbitration, as designated by the arbitrator, shall be entitled to
recover its reasonable cost of the arbitration, including, without limitation,
its reasonable attorneys’ fees, from the other party as determined by the
arbitrator.

     

    * * * *
*

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

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

     

    THIS
CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY THE
PARTIES.

     

     

    
      
        	 	EXPRESS SCRIPTS,
      INC.	 
	 	 	 	 
	 	 	 	 
	 	By: 	/s/
      George Paz	 
	 	Name: 
      George Paz	 
	 	
                Title: 
      Chairman, President and Chief Executive
      Officer

              	 
	 	 	 	 
	 	 	 	 
	 	EXECUTIVE    	 
	 	 	 
	 	 	 
	 	/s/
      Jeffrey L. Hall	 
	 	Name: 
      Jeffery L. HallExhibit 10.1

                         EXECUTIVE EMPLOYMENT AGREEMENT

      This Executive  Employment  Agreement (the  "Agreement") is made as of the
1st day of April, 2008, by and between GoAmerica,  Inc., a Delaware  corporation
(the "Company"), and John Ferron (the "Executive").

      1. Duties and Scope of Employment.

            (a) Positions; Duties.

                  (i) During the Employment  Term (as defined in Section 2), the
Company shall employ Executive as the Chief Operating Officer of the Company. In
his capacity as Chief Operating Officer,  Executive shall report directly to the
Chief Executive Officer of the Company.

                  (ii) Beginning at the  conclusion of the Part-Time  Period (as
defined below) and continuing for so much of the Employment Term as the Board of
Directors of the Company (the "Board") shall decide,  Executive  shall also hold
the position of Chief Financial Officer of the Company. In his capacity as Chief
Financial  Officer,  Executive  shall  report  directly  to the Chief  Executive
Officer of the Company.

                  (iii)  The  Board  may  remove  Executive  from  either of the
positions  set forth in Sections  1(a)(i)  and  1(a)(ii) at any time and for any
reason;  provided,  however,  that at such time as the Board  decides  to remove
Executive from either position, Executive shall relinquish such position without
such  relinquishment  constituting  a  material  breach of this  Agreement,  and
provided further,  that no such removal and/or  relinquishment  shall constitute
termination  of Executive's  employment as long as Executive  retains one of the
positions set forth in Sections 1(a)(i) or 1(a)(ii).

            (b) Employment Schedule.  From the Employment  Commencement Date (as
defined  below) until June 2, 2008,  Executive  shall be employed on a part-time
basis (such  period of  part-time  work,  the  "Part-Time  Period").  During the
Part-Time  Period,  Executive  shall hold only the  position of Chief  Operating
Officer and shall receive fifty percent (50%) of any cash  compensation to which
he would  otherwise be entitled  under Section  3(a).  At the  conclusion of the
Part-Time  Period,  Executive shall be employed on a full-time basis as both the
Chief  Operating  Officer and the Chief  Financial  Officer  (subject to Section
1(a)(iii)) and he shall begin to receive one hundred  percent (100%) of any cash
compensation to which he is entitled under Section 3(a); provided, however, that
the transition to full-time cash compensation shall not be applied retroactively
to the Employment Commencement Date.

            (c) Obligations.  During the Employment Term, Executive shall devote
substantially  all of his business  efforts and time to the  Company.  Executive
agrees,  during  the  Employment  Term,  not to  actively  engage  in any  other
employment,  occupation  or  consulting  activity  for any  direct  or  indirect
remuneration without the prior approval of the Board;  provided,  however,  that
Executive  may (i)  serve  in any  capacity  with any  professional,  community,
industry, civic, educational or charitable organization,  (ii) serve as a member
of corporate  boards of directors on which Executive  currently serves and, with
the consent of the Board (which

<PAGE>

consent shall not be unreasonably  withheld or delayed),  other corporate boards
of directors,  and (iii) manage his and his family's  personal  investments  and
legal affairs; provided,  however, that in each instance, such activities do not
materially interfere with the discharge of Executive's duties.

      2.  Employment  Term.  The Company  hereby agrees to employ  Executive and
Executive  hereby accepts such  employment (the period of such  employment,  the
"Employment  Term"),  in  accordance  with the  terms and  conditions  set forth
herein,  commencing  on April 1,  2008  (the  "Employment  Commencement  Date").
Executive and the Company understand and acknowledge that Executive's employment
with the Company  constitutes  "at-will"  employment.  Subject to the  Company's
obligation to provide severance benefits as specified herein,  Executive and the
Company  acknowledge that this employment  relationship may be terminated at any
time,  upon  written  notice to the other party,  with or without  Cause or Good
Reason (as  defined in Section  4(b) and 4(c),  respectively)  and for any or no
cause or reason, at the option of either the Company or Executive.

      3. Compensation/Benefits. On the Employment Commencement Date, the Company
shall make a one-time  lump-sum payment of forty thousand  dollars  ($40,000) to
Executive as consideration for Executive executing this Agreement.  In addition,
during the  Employment  Term, the Company shall pay and provide to Executive the
following:

            (a) Cash  Compensation.  As  compensation  for his  services  to the
Company,  Executive shall receive a base salary and shall be eligible to receive
additional variable  compensation.  During the Employment Term, the Board or its
Compensation  Committee (the "Compensation  Committee") shall review Executive's
Base  Salary (as defined  below) and Bonus (as defined  below) then in effect at
least annually and may increase (but not decrease, except as provided in Section
1(b)) such Base  Salary as the  Compensation  Committee  may  approve.  The Base
Salary  shall be  payable  in  accordance  with  the  Company's  normal  payroll
practices  in effect  from time to time,  but in no event less  frequently  than
monthly  and,  in the  case of  Bonus,  as soon as  practical  during  the  year
following the year with respect to which such Bonus is payable,  but in no event
later than March 15 of such following  year. No increase in Base Salary shall be
used to offset or otherwise  reduce any  obligations of the Company to Executive
hereunder or otherwise.

                  (i) Annual  Base  Salary.  As of the  Employment  Commencement
Date, Executive's annual Base Salary shall be two hundred sixty thousand dollars
($260,000)  ("Base Salary");  provide,  however,  that such Base Salary shall be
subject to the reduction contemplated in Section 1(b).

                  (ii) Discretionary Bonus.  Executive shall also be eligible to
earn  annual  variable  compensation,  the amount of which shall range from zero
percent (0%) to one hundred  percent  (100%) of the Base Salary  (such  variable
compensation,  the  "Bonus,"  which,  together  with the Base  Salary,  shall be
referred to herein as "Target  Pay").  The Bonus for any calendar  year shall be
awarded at the sole  discretion  of the  Compensation  Committee  based upon the
Company's achievement of stated financial and strategic goals, as established by
the Compensation Committee.

                                       2
<PAGE>

            (b) Equity Compensation.

                  (i) Initial Stock Option Grant. Upon or promptly following the
Employment  Commencement  Date, pending approval by the Board, the Company shall
grant  Executive  an option  (the  "Initial  Option")  to  purchase  two hundred
thousand  (200,000)  shares of the common stock of Company (the "Initial  Option
Shares")  under the Company's 2005 Equity  Compensation  Plan, as amended and in
effect on the date of such grant (the  "Stock  Plan"),  at a per share  exercise
price equal to the fair market  value of the common  stock of the Company on the
date on which the Initial Option is granted,  as determined by the  Compensation
Committee,  in  accordance  with the Stock Plan.  Such  Initial  Option shall be
substantially  in the form  attached  hereto  as  Exhibit A (the  "Stock  Option
Agreement").

                  (ii) Supplemental Stock Option Grant.  Pending approval by the
Board,  and subject to, but in no event more than three (3) business days after,
receipt by the Company of  stockholder  approval of the first  amendment  to the
Stock Plan to occur after the  Employment  Commencement  Date, the Company shall
grant  Executive  an  additional   option  (the  "Second  Option")  to  purchase
seventy-five  thousand  (75,000)  shares of the common stock of the Company (the
"Second Option  Shares," and together with the First Option Shares,  the "Option
Shares")  under the Stock Plan, at a per share  exercise price equal to the fair
market  value of the common stock of the Company on the date on which the Second
Option is granted,  as determined by the Compensation  Committee,  in accordance
with the Stock Plan.  Such Second Option shall be  substantially  in the form of
the Stock Option Agreement.

                  (iii)  Ongoing   Awards.   Executive   shall  be  eligible  to
participate  fully in annual stock option grants and any other long-term  equity
incentive  program at levels  commensurate with his positions as Chief Operating
Officer  and  Chief  Financial  Officer  of  the  Company  (subject  to  Section
1(a)(iii)).

            (c) Employee Benefits.  Executive shall, to the extent eligible,  be
entitled to  participate  at a level  commensurate  with his  positions as Chief
Operating Officer and Chief Financial Officer of the Company (subject to Section
1(a)(iii)) in all employee  benefit,  welfare and retirement plans and programs,
as well as equity  plans,  provided by the Company to its senior  executives  in
accordance   with  the  terms   thereof   as  in  effect   from  time  to  time.
Notwithstanding  the foregoing,  at all times, the Company reserves the right to
amend, modify, or terminate any such plan or program.

                  (i) The Company will provide to Executive,  at its expense,  a
parking place, executive office,  secretarial assistance,  facilities,  supplies
and equipment  appropriate to his positions as Chief Operating Officer and Chief
Financial Officer of the Company (subject to Section 1(a)(iii)). In addition, if
Executive  relocates  his  residence  for the  purpose  of being  closer  to the
Company's  executive  offices in  California,  the  Company and  Executive  will
discuss and mutually  agree upon the  reimbursement  of  Executive's  reasonable
relocation  expenses actually  incurred  (including real estate brokerage fees);
provided,  however,  that any such  reimbursement  will be made  within ten (10)
business  days  of  Executive  submitting  receipts  for  qualifying  relocation
expenses,  and provided further,  that such reimbursement shall be made no later
than  March  15 of the  year  following  the year in  which  such  expenses  are
incurred.

                                       3
<PAGE>

            (d) Additional  Benefits.  During the  Employment  Term, the Company
shall provide Executive with the following additional benefits:

                  (i) Reimbursement of up to three thousand dollars ($3,000) per
month  for  one or more  of the  following  direct,  incurred  expenses,  in the
Executive's  sole  discretion:  (A) corporate  housing  (furnished  apartment or
hotel) reasonably near the Company's executive offices in California; (B) office
space in Los Gatos,  California;  and/or (C) use of a car service,  with driver,
solely for Executive's  business purposes  (including travel between his home or
Los Gatos office and the Company's  executive offices in California);  provided,
however,  that this benefit shall  terminate  upon the earliest of (X) three (3)
years from the Employment  Commencement Date, (Y) the Company's establishment of
an office within  forty-five (45) miles of Executive's  home, and (Z) relocation
of  Executive's  residence to be within  forty-five  (45) miles of the Company's
executive  offices in  California.  Any  reimbursement  made under this  Section
3(d)(i)  will be made  within ten (10)  business  days of  Executive  submitting
receipts for qualifying  relocation  expenses,  and provided further,  that such
reimbursement  shall be made no later  than March 15 of the year  following  the
year in which such expenses are incurred.

                  (ii) Subject to and in accordance with the Company's  policies
and procedures  and in accordance  with the Company's  payroll  practices but no
less  frequently  than  monthly,  the  Company  shall  provide  to  Executive  a
non-accountable,   discretionary  expense  allowance  of  one  thousand  dollars
($1,000)  per  month  to be used  by  Executive  for  all of his own  automobile
expenses (including, without limitation, his automobile lease or similar finance
payments,  insurance, and all gas mileage (whether travel is personal or related
to his employment by the Company)),  club and organization  dues or memberships,
travel  upgrades,  technology  devices,  and similar  executive  perquisites and
related taxes.

            (e)  Business  and  Entertainment   Expenses.   Upon  submission  of
appropriate documentation by Executive in accordance with the Company's policies
in effect from time to time,  the Company  shall pay or reimburse  Executive for
all business  expenses that Executive incurs in performing his duties under this
Agreement,  including,  but not limited to, travel (excluding gas mileage, which
is  covered by  Section  3(d)(ii)),  entertainment,  and  professional  dues and
subscriptions,  in accordance with the Company's policies in effect from time to
time.  The Company  shall not be obligated to reimburse  Executive  for personal
legal fees or taxes incurred for any reason.

            (f) Vacation,  Holidays and Sick Leave.  Executive shall be entitled
to  vacations  of no less  than  five (5) weeks  per  calendar  year;  provided,
however,  that Executive shall be limited to future accruals of no more than six
(6) weeks of paid vacation. Executive shall also be entitled to absences because
of illness or other  incapacity,  and such other absences,  whether for holiday,
personal  time,  or for  any  other  purpose,  as  set  forth  in the  Company's
employment manual or current procedures and policies, as the case may be, as the
same may be amended from time to time.

      4. Termination of Employment.

            (a) Death or  Disability.  The  Company  may  terminate  Executive's
employment for disability in the event  Executive has been unable to perform his
material duties

                                       4
<PAGE>

hereunder  for  six  (6)  consecutive  months  because  of  physical  or  mental
incapacity by giving Executive notice of such termination  while such continuing
incapacity continues (a "Disability Termination").  Executive's employment shall
automatically   terminate  on  Executive's   death.  In  the  event  Executive's
employment with the Company  terminates  during the Employment Term by reason of
Executive's  death  or a  Disability  Termination,  then  upon  the date of such
termination:

                  (i) any Option Shares that would have vested solely due to the
passage of time during the twelve  (12) month  period  beginning  on the date of
Executive's death or Disability Termination shall immediately vest;

                  (ii) the Company  shall,  within  thirty (30) days of the date
Executive's employment is terminated, pay and provide Executive (or in the event
of Executive's death, Executive's estate) (A) any unpaid Base Salary through the
date  of  termination  and  any  accrued  vacation,  (B)  reimbursement  for any
unreimbursed  expenses  incurred  through the date of  termination,  and (C) all
other  payments,  benefits or fringe benefits to which Executive may be entitled
subject to and in  accordance  with,  the terms of any  applicable  compensation
arrangement  or benefit,  equity or fringe  benefit plan or program or grant and
amounts that may become due under Sections 5 and 9 hereof  (collectively,  items
under this clause (i) are referred to as "Accrued Benefits"); and

                  (iii) the  Company  shall pay to  Executive  at the time other
senior executives are paid under any cash bonus or long-term incentive plan, but
in no  event  later  than  March  15 of the  year  following  the  year in which
Executive's  employment  is  terminated,  a pro-rata  bonus  equal to the amount
Executive would have received if Executive's  employment had continued  (without
any discretionary  cutback)  multiplied by a fraction where the numerator is the
number of days in each respective bonus period prior to Executive's  termination
and the  denominator  is the number of days in the bonus  period (the  "Prorated
Bonus"); provided, however, that at the time of death or Disability Termination,
Executive  is on pace to achieve  the  performance  milestones  necessary  to be
eligible for such bonus.

            (b)  Termination  for Cause.  The Company may terminate  Executive's
employment  for  Cause  (as  defined  below).  In  the  event  that  Executive's
employment  with the Company is  terminated  during the  Employment  Term by the
Company for Cause, Executive shall not be entitled to any additional payments or
benefits hereunder,  other than Accrued Benefits (including, but not limited to,
any then-vested  Option Shares and other equity awards),  to be paid or provided
within thirty (30) days of the date Executive's employment is terminated.

                  (i) For the purposes of this Agreement, "Cause" shall mean:

                        (A) material  breach of any provision of this  Agreement
by Executive;

                        (B) the  willful  failure by  Executive  to perform  his
duties  with  the  Company  (other  than  any such  failure  resulting  from his
incapacity  due to physical or mental  impairment),  unless any such  failure is
corrected  within thirty (30) days  following  written  notice by the Board that
specifically identifies the manner in which the Board believes Executive has

                                       5
<PAGE>

not materially performed his duties; provided,  however, that no act, or failure
to act, by Executive shall be "willful" unless committed  without good faith and
without a reasonable belief that the act or omission was in the best interest of
the Company; or

                        (C) an act of gross  misconduct by Executive with regard
to the Company that is materially injurious to the Company.

            (c) Termination by the Company Other Than for Cause;  Termination by
Executive  With Good Reason.  Any payments to be made or benefits to be provided
under this  Section  4(c) are  conditioned  on (x)  Executive's  execution  of a
general release and/or termination  agreement  satisfactory to the Company,  and
(y) such general release and/or termination agreement becoming effective.

                  (i)  If   Executive's   employment   with   the   Company   is
involuntarily  terminated by the Company other than for Cause (for  avoidance of
doubt,  removal of Executive  from either of his positions  under this Agreement
shall not constitute  termination of his employment as long as Executive retains
one such position) or if Executive  voluntarily  terminates his employment  with
the Company for Good Reason (as defined  below),  then the Company  shall pay or
provide Executive with the following as of the date of termination:

                        (A) any Accrued Benefits,  to be paid or provided within
thirty (30) days of the date Executive's employment is terminated;

                        (B) the Prorated Bonus;  provided,  however, that at the
time of the  termination  of  Executive's  employment,  Executive  is on pace to
achieve the performance  milestones  necessary to be eligible for such bonus and
provided  further that such Prorated Bonus is paid no later than March 15 of the
year following the year in which Executive's employment is terminated;

                        (C)  a  severance   amount  equal  to  the   Executive's
then-current  annual Base Salary,  payable in a lump sum within thirty (30) days
of the date Executive's employment is terminated; provided, however, that if the
termination occurs during the Part-Time Period, the severance amount shall equal
fifty percent (50%) of Executive's then-current Base Salary;

                        (D) the  right  to  continue  his  participation  in the
Company's  health  benefit  plans to the  extent  that he is then a  participant
therein, at no additional cost to Executive other than he would have incurred as
an employee, for a period of twelve (12) months starting with the first calendar
month after such date of termination;  provided, however, that Company shall pay
the full  premium for COBRA  continuation  coverage  under its health  plans for
Executive (and, if applicable,  his dependents  enrolled as participants in such
health plans as of the date of termination) for such twelve-month period. In the
event Executive obtains other employment during the twelve-month  period in this
clause (D),  pursuant to which he becomes covered for  substantially  similar or
improved  benefits,  the right to continue to  participate in any health benefit
plan,  at the  Company's  expense,  offered or  provided  by the  Company  shall
immediately cease; and

                                       6
<PAGE>

                        (E)   reasonable   outplacement   services  at  a  level
commensurate  with  Executive's  positions as Chief Operating  Officer and Chief
Financial Officer of the Company (subject to Section  1(a)(iii)),  including use
of an  executive  office  and  secretary,  for a  period  of  ninety  (90)  days
commencing on Executive's  date of termination but in no event extending  beyond
the date on which Executive commences other full time employment.

                  (ii)  For  purposes  of  this  Agreement,  "Good  Reason"  for
termination by Executive  shall arise from the following  conduct of the Company
or  events  without  Executive's  consent  (other  than  in  connection  with or
subsequent to the termination or suspension of Executive's  employment or duties
for Cause or in connection with Executive's  death or disability,  and excluding
any isolated action not taken in bad faith and which is promptly remedied by the
Company after receipt of notice thereof from Executive); provided, however, that
in each instance,  Executive shall provide reasonably detailed written notice of
any  action or event that  would  constitute  Good  Reason  under  this  Section
4(c)(ii) to the Company within ninety (90) days of such action or event, and the
Company  shall have thirty (30) days to cure such action or event,  and provided
further  that if such  action or event is not cured by the  Company  within such
thirty  (30) day  period,  Executive's  employment  will  then be  deemed  to be
terminated with Good Reason:

                        (A) Material  breach of any provision of this  Agreement
by the Company; or

                        (B) After a Change of Control (as defined below), in the
event that (i) Executive's  aggregate  compensation is substantially  diminished
(regardless of  Executive's  title,  duties,  or  responsibilities)  or (ii) the
office  from  which  Executive  is  expected  to  perform  the  majority  of his
obligations  under this  Agreement is located more than one hundred  (100) miles
from Los  Gatos,  California  (it  being  understood  that as of the  Employment
Commencement  Date,  Executive  will be expected to perform the  majority of his
obligations under this Agreement from the Company's executive offices in Novato,
California  and  an  office  to  be  established  by  Executive  in  Los  Gatos,
California).

            (d)  Termination  by Executive  Without Good Reason.  Executive  may
terminate his  employment  at any time without Good Reason by written  notice to
the Company.  In the event that Executive  terminates  his  employment  with the
Company during the Employment  Term without Good Reason,  Executive shall not be
entitled to any additional  payments or benefits  hereunder,  other than Accrued
Benefits (including, but not limited to, any then-vested Option Shares and other
equity  awards),  to be paid or  provided  within  thirty  (30) days of the date
Executive's employment is terminated.

            (e) No Mitigation/No Offset. Executive shall not be required to seek
other  employment  or  otherwise  mitigate the value of any  severance  benefits
contemplated  by this  Agreement,  nor shall any such benefits be reduced by any
earnings or benefits that Executive may receive from any other source, except as
provided in Sections  4(c)(i)(D) and 4(c)(i)(E).  The amounts payable  hereunder
shall not be subject to setoff, counterclaim, recoupment, defense or other right
that the Company may have against Executive or others.

      5. Change of Control Vesting Acceleration.

                                       7
<PAGE>

            (a)  In the  event  of a  Change  of  Control  (as  defined  below),
twenty-five  percent  (25%) of  Executive's  then-unvested  Option  Shares shall
immediately vest.

            (b) After a Change of Control (as defined below),  in the event that
(i) Executive's aggregate  compensation is substantially  diminished (regardless
of Executive's title, duties, or responsibilities) or (ii) the office from which
Executive  is  expected to perform the  majority of his  obligations  under this
Agreement  is  located  more  than one  hundred  (100)  miles  from  Los  Gatos,
California (it being  understood  that as of the Employment  Commencement  Date,
Executive will be expected to perform the majority of his obligations under this
Agreement  from the Company's  executive  offices in Novato,  California  and an
office  to be  established  by  Executive  in  Los  Gatos,  California),  all of
Executive's   then-unvested   Option   Shares  and  other  equity  awards  shall
immediately  vest  in  full,  and if,  after  a  Change  of  Control,  Executive
terminates his employment with the Company for Good Reason, he shall be entitled
to receive all severance benefits set forth in Section 4(c)(i).

            (c) For the  purposes  of this  Agreement,  "Change of  Control"  is
defined  as  the  occurrence  of  any  of the  following  after  the  Employment
Commencement Date:

                  (i) any "person" (as defined in Section 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), excluding for
this  purpose,  (i) the Company or any  subsidiary  of the Company,  or (ii) any
employee  benefit plan of the Company or any  subsidiary of the Company,  or any
person or entity  organized,  appointed  or  established  by the  Company for or
pursuant to the terms of any plan which acquires beneficial  ownership of voting
securities of the Company,  is or becomes the "beneficial  owner" (as defined in
Rule 13d-3 under the Exchange Act),  directly or indirectly of securities of the
Company  representing more than fifty percent (50%) of the combined voting power
of the Company's then outstanding securities;  provided, however, that no Change
of Control will be deemed to have  occurred as a result of a change in ownership
percentage  resulting  solely from an  acquisition of securities by the Company,
the grant or exercise of any stock option,  stock award, stock purchase right or
similar equity incentive,  or the continued beneficial ownership by any party of
voting securities of the Company which such party  beneficially  owned as of the
Employment Commencement Date; or

                  (ii)  persons,  who, as of the  Employment  Commencement  Date
constitute the Board (the "Incumbent Directors") cease for any reason, including
without  limitation,  as a result of a tender offer,  proxy  contest,  merger or
similar  transaction,  to  constitute  at least a  majority  thereof,  provided,
however,  that any person  becoming a director of the Company  subsequent to the
Employment  Commencement Date shall be considered an Incumbent  Director if such
person's  election or nomination for election was approved by a vote of at least
fifty percent (50%) of the Incumbent Directors;  and provided further,  that any
such person whose initial  assumption of office is in connection  with an actual
or  threatened  election  contest  relating to the members of the Board or other
actual or  threatened  solicitation  of proxies or consents by or on behalf of a
"person" (as defined in Section  13(d) and 14(d) of the Exchange Act) other than
the Board, including by reason of agreement intended to avoid or settle any such
actual  or  threatened  contest  or  solicitation,  shall not be  considered  an
Incumbent Director; or

                                       8
<PAGE>

                  (iii)   consummation   of   a   reorganization,    merger   or
consolidation or sale or other  disposition of at least 80% of the assets (other
than cash and cash  equivalents) of the Company (a "Business  Combination"),  in
each case, unless, following such Business Combination, all or substantially all
of the  individuals  and entities who were the beneficial  owners of outstanding
voting securities of the Company immediately prior to such Business  Combination
beneficially own,  directly or indirectly,  more than fifty percent (50%) of the
combined voting power of the then outstanding voting securities entitled to vote
generally  in the  election  of  directors,  as the case may be, of the  company
resulting  from such Business  Combination  (including,  without  limitation,  a
company  which,  as a result of such  transaction,  owns the  Company  or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries)  in  substantially   the  same  proportions  as  their  ownership,
immediately  prior  to such  Business  Combination,  of the  outstanding  voting
securities of the Company; or

                  (iv) approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

      6. Golden Parachute Payments.

            (a) Executive  shall bear all expense of, and be solely  responsible
for, all federal,  state, local or foreign taxes due with respect to any benefit
received pursuant to this Agreement,  including,  without limitation, any excise
tax imposed by Section  4999 of the Internal  Revenue  Code of 1986,  as amended
(the "Code"); provided,  however, that any benefit received or to be received by
Executive in connection  with a Change of Control  ("Contract  Benefits") or any
other  plan,   arrangement  or  agreement  with  the  Company  or  an  affiliate
(collectively  with the  Contract  Benefits,  the "Total  Benefits")  that would
constitute a "parachute payment" within the meaning of Section 280G of the Code,
shall be reduced to the extent  necessary  so that no portion  thereof  shall be
subject to the excise tax imposed by Section  4999 of the Code,  but only if, by
reason of such reduction,  the net after-tax  benefit received by Executive as a
result of such  reduction  shall exceed the net  after-tax  benefit  received by
Executive if no such  reduction  was made.  For purposes of this Section 6, "net
after-tax  benefit" shall mean the Total Benefits that Executive  receives or is
then  entitled to receive  from the Company  that would  constitute a "parachute
payment"  within the meaning of Section 280G of the Code, less (i) the amount of
all federal,  state and local income and  employment  taxes payable by Executive
with respect to such  "parachute  payment,"  calculated at the highest  marginal
income tax rate for each year in which the foregoing  shall be paid to Executive
(based  on the rates set forth in the Code as in effect at the time of the first
receipt of the foregoing benefits),  and (ii) the amount of excise taxes imposed
with respect to such "parachute payment" by Section 4999 of the Code.

            (b) The  accounting  firm engaged by the Company (or its  successor)
for general tax purposes shall perform any adjustment pursuant to subsection (a)
of this  Section 6. The  Company  shall bear all  expenses  with  respect to the
determinations  by such  accounting  firm  required  to be made  hereunder.  The
accounting firm engaged to make the  determinations  hereunder shall provide its
calculations,  together with detailed supporting documentation, to Executive and
to the Company  within  fifteen (15)  calendar  days of being engaged to perform
such  determination  and  adjustment,  or at such other time as requested by the
Company.  Any good faith  determinations  of the accounting  firm made hereunder
shall be final, binding and conclusive upon you and the Company.

                                       9
<PAGE>

      7. Section 409A Compliance.

            (a) To the extent  that any  amount  payable  under  this  Agreement
constitutes an amount payable under a "nonqualified  deferred compensation plan"
(as  defined  in  Section  409A  of  the  Code  ("Section  409A"))  following  a
"separation  from  service" (as defined in Section  409A),  including any amount
payable  under  Section 4, then,  notwithstanding  any other  provision  in this
Agreement to the  contrary,  such payment will not be made to Executive  earlier
than  the day  after  the  date  that is six (6)  months  following  Executive's
"separation  from  service."  This  Section  7(a) will not be  applicable  after
Executive's death.

            (b) Executive and the Company  acknowledge  that the requirements of
Section 409A are still being developed and  interpreted by government  agencies,
that certain issues under Section 409A remain unclear at this time, and that the
parties  hereto have made a good faith  effort to comply with  current  guidance
under Section 409A.  Notwithstanding anything in this Agreement to the contrary,
in the event that  amendments to this Agreement are necessary in order to comply
with future guidance or interpretations under Section 409A, including amendments
necessary  to ensure  that  compensation  will not be subject  to Section  409A,
Executive agrees that the Company shall be permitted to make such amendments, on
a prospective and/or retroactive basis, in its sole discretion.

      8.  Restrictive  Covenants.  Executive  acknowledges  that  the  Company's
ability to keep its Confidential Information (as defined in Section 9(b)) secret
and away from its  competitors is important to the Company's and its affiliates'
viability and business.  Executive further  acknowledges that over the course of
his  employment  with the  Company he will (i) develop  special and  substantial
relationships  with the Company's and its  affiliates'  customers and suppliers,
and/or (ii) be privy to Confidential Information.  Further,  Executive will help
develop the goodwill of the Company and its affiliates  during the course of his
employment. Finally, pursuant to Section 3(b), Executive will have a substantial
ownership  interest in the Company.  As such,  Executive  agrees to abide by the
following covenants in order to allow the Company to protect those interests:

            (a)  Non-Competition.  During the  "Restricted  Period"  (as defined
below),  Executive will not either  directly or  indirectly,  for himself or any
other person or entity,  anywhere  within the United  States,  carry on, own, be
engaged in,  assist,  be employed by,  consult for,  serve as a director for, or
have any  financial  interest in any business or  enterprise  that is materially
engaged in the  telecommunications  relay service ("TRS") or call center service
industries  or any other  industry in which the Company is engaged to a material
extent at the time Executive's  employment  terminates,  provided that an equity
investment  of not more than two percent  (2%) in any  company  that is publicly
traded  and  whose  shares  are  listed on a  national  stock  exchange  will be
permitted.

            For purposes of this Section 8, "Restricted Period" means the period
beginning on the Employment  Commencement  Date and  continuing  until the first
(1st) anniversary of Executive's  employment  termination date,  irrespective of
the reason that Executive's employment is terminated with the Company.

                                       10
<PAGE>

            (b) Non-Solicitation.  During the Restricted Period,  Executive will
not either  directly or  indirectly,  for himself or any other person or entity,
(i) hire,  solicit for services,  encourage the  resignation of, or in any other
manner seek to engage or employ,  any person who is an employee of the  Company,
or a consultant of the Company  devoting more than seventy  percent (70%) of his
or her  time  to  the  business  of the  Company  or any of its  affiliates,  on
Executive's  employment  termination  date or during  the six (6)  month  period
preceding  such  termination  date,  or (ii)  solicit,  provide  services to, or
otherwise interfere with the Company's business  relationship with, any customer
of the Company in connection with services and/or products that compete with the
Company's services or products, provided that such customer is a customer of the
Company on the  employment  termination  date or during the one (1) year  period
preceding such termination date.

            (c) Equitable Relief.  Executive acknowledges that the remedy at law
for his  breach of Section 8, 9(a)  and/or 10 will be  inadequate,  and that the
damages  flowing  from such  breach  will not be  readily  susceptible  to being
measured in monetary  terms.  Accordingly,  upon a violation of any part of such
Sections,  the Company will be entitled to immediate injunctive relief (or other
equitable  relief)  and may obtain a  temporary  order  restraining  any further
violation.  No  bond or  other  security  will be  required  in  obtaining  such
equitable  relief,  and  Executive  hereby  consents  to the  issuance  of  such
equitable  relief.  Such equitable  relief may be obtained from any court having
appropriate  jurisdiction over the matter. Nothing in this Section 8(c) shall be
deemed to limit the  Company's  remedies at law or in equity that may be pursued
or availed of by the Company for any breach by  Executive of any of the parts of
Sections 8, 9(a) and/or 10.

            (d) Judicial  Modification.  Executive  acknowledges  that it is the
intent of the parties  hereto that the  restrictions  contained or referenced in
Sections 8, 9 and 10 be enforced to the  fullest  extent  permissible  under the
laws  of  each  jurisdiction  in  which  enforcement  is  sought.  If any of the
restrictions  contained or referenced in such Sections is for any reason held by
a  court  or  arbitrator  to be  excessively  broad  as to  duration,  activity,
geographical  scope, or subject,  then, for purposes of that jurisdiction,  such
restriction shall be construed, judicially modified, or "blue penciled" so as to
thereafter  be limited or reduced to the extent  required to be  enforceable  in
accordance with applicable law. Executive acknowledges and understands that, due
to the nature and scope of the Company's  existing and proposed  business  plans
and projects, and the technological  advancements in electronic  communications,
any narrower  geographic  restriction of his obligations under Sections 8(a) and
8(b) would be inappropriate and counter to the protections sought by the Company
thereunder.

      9. Confidential Information.

            (a)  Non-Use  and   Non-Disclosure   of  Confidential   Information.
Executive  acknowledges  that,  during  the  course of his  employment  with the
Company,  he  will  have  access  to  information  about  the  Company  and  its
affiliates,  and their  customers and  suppliers,  that is  confidential  and/or
proprietary in nature, and that belongs to the Company and/or its affiliates. As
such, at all times,  both during his employment and  thereafter,  Executive will
hold in the strictest  confidence,  and not use or attempt to use except for the
benefit of the Company and its affiliates,  and not disclose to any other person
or  entity  (without  the  prior  written   authorization   of  the  Board)  any
"Confidential  Information"  (as  defined  in  Section  9(b)).   Notwithstanding

                                       11
<PAGE>

anything  contained in this Section 9,  Executive  will be permitted to disclose
any  Confidential  Information to the extent  required by  validly-issued  legal
process or court order,  provided that Executive  notifies the Board immediately
of any such legal  process or court  order in an effort to allow the  Company to
challenge such legal process or court order, if the Company so elects,  prior to
Executive's disclosure of any Confidential Information.

            (b)  Definition of  Confidential  Information.  For purposes of this
Agreement,  "Confidential  Information"  means any  confidential  or proprietary
information  that  belongs  to the  Company or its  affiliates,  or any of their
customers or suppliers,  including,  without limitation,  technical data, market
data, trade secrets,  trademarks,  service marks, copyrights, other intellectual
property,  know-how,  research, business plans, product and service information,
projects,  services,  customer  lists  and  information,  customer  preferences,
customer transactions, supplier lists and information, supplier rates, software,
hardware, technology,  inventions,  developments,  processes, formulas, designs,
drawings,  marketing methods and strategies,  pricing strategies, sales methods,
financial   information,   project   information,   revenue   figures,   account
information,  credit information,  financing arrangements, and other information
disclosed to Executive by the Company or its affiliates in confidence,  directly
or  indirectly,  and  whether in  writing,  orally,  or by  electronic  records,
drawings, pictures, or inspection of tangible property.

      10.  Return of  Company  Property.  Upon the  termination  of  Executive's
employment with the Company,  or at any time during such employment upon request
by the Company,  Executive will promptly  deliver to the Company and not keep in
his possession,  recreate, or deliver to any other person or entity, any and all
property that belongs to the Company or any of its  affiliates,  or that belongs
to any other third  party and is in  Executive's  possession  as a result of his
employment with the Company,  including,  without limitation,  computer hardware
and software, Blackberries or other personal data assistants or similar devices,
pagers,  mobile or cellular phones, other electronic equipment,  records,  data,
customer lists and information,  supplier lists and information, notes, reports,
correspondence,  financial information, account information, product and service
information,  project  information,  files, and other documents and information,
including any and all copies of the foregoing.

      11. No Prior  Restrictions.  Executive  represents  and warrants  that his
employment  with the Company does not violate,  or cause him to be in breach of,
any obligation or covenant made to any former employer or other third party, and
that during the course of his  employment  with the Company he will not take any
action that would violate or breach any legal obligation that he may have to any
former  employer or other third party.  In the event of a breach of this Section
11, including in the event that Executive's representation and warranty above is
false,  Executive  shall hold the  Company  harmless  and  indemnify  it for any
damages  resulting  to it or  its  affiliates,  including,  without  limitation,
attorneys' fees, as a result of the breach of this Section 11.

      12. Assignment.

            (a) This Agreement shall be binding upon and inure to the benefit of
(i) the heirs,  beneficiaries,  executors and legal representatives of Executive
upon Executive's death and (ii) any successor of the Company, provided, however,
that any  successor  shall  within ten (10)

                                       12
<PAGE>

days of such  assumption  deliver to  Executive a written  assumption  in a form
reasonably  acceptable to Executive.  Any such successor of the Company shall be
deemed  substituted  for the Company  under the terms of this  Agreement for all
purposes. As used herein,  "successor" shall mean any person, firm,  corporation
or other  business  entity  that at any time,  whether  by  purchase,  merger or
otherwise,  directly or  indirectly  acquires  all or  substantially  all of the
assets or business of the Company.  Notwithstanding such assignment, the Company
shall remain,  with such successor,  jointly and severally liable for all of its
obligations  hereunder.  This  Agreement  may not  otherwise  be assigned by the
Company.

            (b)  None  of the  rights  of  Executive  to  receive  any  form  of
compensation   payable  pursuant  to  this  Agreement  shall  be  assignable  or
transferable except through a testamentary disposition or by the laws of descent
and  distribution  upon the death of  Executive  or as  provided  in  Section 20
hereof.  Any attempted  assignment,  transfer,  conveyance or other  disposition
(other  than as provided  in this  Section 12) of any  interest in the rights of
Executive to receive any form of compensation  hereunder shall be null and void;
provided,  however,  that  notwithstanding  the  foregoing,  Executive  shall be
allowed to transfer vested Option Shares or other stock options or equity awards
consistent  with the rules for transfers to "family  members" as defined in U.S.
Securities and Exchange Commission Form S-8.

      13. Liability Insurance.

            (a) The Company shall cover Executive under directors' and officers'
liability insurance both during and, while potential liability exists, after the
Employment  Term in the same  amount  and to the  same  extent,  if any,  as the
Company covers its other officers and directors.

            (b) The Company shall,  both during and after the  Employment  Term,
indemnify  and hold  harmless  Executive  to the  fullest  extent  permitted  by
applicable  law with regard to actions or  inactions  taken by  Executive in the
performance  of his duties as an officer,  director  and employee of the Company
and its  affiliates or as a fiduciary of any benefit plan of the Company and its
affiliates.

      14.  Notices.  All  notices,  requests,  demands and other  communications
called  for  hereunder  shall be in  writing  and shall be  deemed  given if (a)
delivered  personally  or by  facsimile,  (b) one (1) day  after  being  sent by
Federal Express or a similar commercial overnight service, or (c) three (3) days
after being mailed by registered or certified  mail,  return receipt  requested,
prepaid  and  addressed  to the parties or their  successors  in interest at the
following addresses,  or at such other addresses as the parties may designate by
written notice in the manner set forth in this Section 14:

            If to the Company:

                  GoAmerica, Inc.
                  Attn:  Chief Executive Officer
                  595 Menlo Drive
                  Rocklin, CA 95765

                                       13
<PAGE>

            If to Executive:

                  John Ferron
                  106 Mill Road
                  Los Gatos, CA 95032

      15.  Severability.  In the event that any provision  hereof  becomes or is
declared by a court of competent  jurisdiction to be illegal,  unenforceable  or
void,  this  Agreement  shall  continue  in full force and effect  without  said
provision.

      16. Entire Agreement.  This Agreement  represents the entire agreement and
understanding   between  the  Company  and  Executive   concerning   Executive's
employment  relationship  with the Company,  and supersedes and replaces any and
all  prior  agreements  and  understandings  concerning  Executive's  employment
relationship with the Company entered into prior to the date hereof, but it does
not supersede or replace any written  agreements  entered into simultaneous with
this Agreement or thereafter.

      17. Arbitration.

            (a)  Agreement.  The Company  and  Executive  agree that,  except as
otherwise  provided in Section 8(c), any dispute or controversy  arising out of,
relating to, or in connection with the employment relationship between them, the
inception of that  relationship,  the  termination  of that  relationship,  this
Agreement, or the interpretation,  validity, construction,  performance, breach,
or termination thereof, including, without limitation, claims of discrimination,
harassment,  and/or retaliation,  and any violation of whistleblower laws, shall
be settled by final and binding  arbitration to be held in New York, New York or
such other location agreed by the parties  hereto,  under the auspices of and in
accordance  with the National  Rules for the  Resolution of Employment  Disputes
then in effect of the American  Arbitration  Association ("AAA"). The arbitrator
may grant  injunctions  or other  relief in such  dispute  or  controversy.  The
decision of the arbitrator shall be final, conclusive and binding on the parties
to the arbitration.  Judgment may be entered on the arbitrator's decision in any
court having jurisdiction.  The selection of the arbitrator will be conducted in
accordance  with the AAA's  practices and  procedures for disputes of the nature
here  contemplated.  The  arbitrator  will  have  authority  and  discretion  to
determine the arbitrability of any particular  claim,  should any disputes arise
with respect to such issue.

            (b) Costs and Fees of  Arbitration.  The moving  party shall pay the
costs of the initial arbitration filing (not to exceed two hundred fifty dollars
($250)),  and the Company  shall pay the  remaining  costs and  expenses of such
arbitration.  Unless  otherwise  required  by law or pursuant to an award by the
arbitrator,  the  Company and  Executive  shall each pay  separately  its or his
counsel fees and expenses.  Notwithstanding  the foregoing,  the arbitrator may,
but need not,  award the  prevailing  party in any dispute its or his legal fees
and expenses.

      18. No Oral  Modification,  Cancellation or Discharge.  This Agreement may
only be amended,  canceled or discharged  in writing  signed by Executive and an
appropriate officer or director of the Company.

                                       14
<PAGE>

      19.  Survivorship.  The respective  rights and  obligations of Company and
Executive  hereunder shall survive any termination of Executive's  employment by
the Company to the extent necessary to preserve such rights and obligations.

      20.  Beneficiaries.  Executive shall be entitled,  to the extent permitted
under any applicable law, to select and change the beneficiary or  beneficiaries
to receive  any  compensation  or benefit  payable  hereunder  upon his death by
giving the Company written notice thereof. If Executive dies, severance then due
or other amounts due hereunder  shall be paid to his  designated  beneficiary or
beneficiaries or, if none are designated or none survive Executive, his estate.

      21. Withholding. The Company shall be entitled to withhold, or cause to be
withheld, any amount of federal, state, city or other withholding taxes required
by law with  respect  to  payments  made to  Executive  in  connection  with his
employment hereunder.

      22.  Governing  Law.  This  Agreement  shall be governed  by Delaware  law
(without  reference to rules of conflicts of law), which shall be applied to the
merits of any dispute or claim  submitted to arbitration  pursuant to Section 13
of this  Agreement.  Executive and the Company hereby  expressly  consent to the
personal  jurisdiction  of the state and federal courts located in New York, New
York for any  action or  proceeding  relating  to any  arbitration  pursuant  to
Section 13 of this Agreement in which the parties are participants, or any claim
to which Section 8(c) applies.

 [Remainder of page intentionally left blank - signatures on the following page]

                                       15
<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this Agreement:

                                            GOAMERICA, INC.

                                            By: /s/ Daniel R. Luis
                                                -------------------------------
                                                Name: Daniel R. Luis
                                                Title: Chief Executive Officer

                                            JOHN FERRON

                                            /s/ John Ferron
                                            -----------------------------------

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