Document:

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                                                                    Exhibit 10.3

                           COOPERATIVE HOLDINGS, INC.

                            INDEMNIFICATION AGREEMENT

         This Indemnification Agreement ("Agreement") is made as of March 20,
2000, by and between Cooperative Holdings, Inc., a Delaware corporation
(the "Company"), and _____________________________ ("Indemnitee").

         WHEREAS, Indemnitee is an officer and/or director of the Company and
performs a valuable service in such capacity for the Company;

         WHEREAS, the Company and Indemnitee recognize the substantial increase
in corporate litigation in general, subjecting directors, officers, employees,
agents and fiduciaries to expensive litigation risks at the same time as the
availability and coverage of liability insurance may be limited;

         WHEREAS, the Company and Indemnitee further recognize the difficulty in
obtaining liability insurance for its directors, officers, employees, agents and
fiduciaries, the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance;

         WHEREAS, Indemnitee does not regard the current protection available as
adequate under the present circumstances, and the Indemnitee and other
directors, officers, employees, agents and fiduciaries of the Company may not be
willing to continue to serve in such capacities without additional protection;
and

         WHEREAS, the Company desires to attract and retain the services of
highly qualified individuals, such as Indemnitee, to serve the Company and, in
part, in order to induce Indemnitee to continue to provide services to the
Company as an officer and/or director, the Company wishes to provide for the
indemnification and advancing of expenses to Indemnitee to the maximum extent
permitted by law.

         NOW, THEREFORE, the Company and Indemnitee hereby agree as follows:

         1. Indemnification.

                  (a) Indemnification of Expenses. The Company shall indemnify
Indemnitee to the fullest extent permitted by law if Indemnitee was or is or
becomes a party to or witness or other participant in, or is threatened to be
made a party to or witness or other participant in, any threatened, pending or
completed action, suit, proceeding or alternative dispute resolution mechanism,
or any hearing, inquiry or investigation that Indemnitee in good faith believes
might lead to the institution of any such action, suit, proceeding or
alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or other (hereinafter a "Claim") by reason of (or
arising in part out of) any event or occurrence related to the fact that
Indemnitee is
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or was a director, officer, employee, agent or fiduciary of the Company, or any
subsidiary of the Company, or is or was serving at the request of the Company as
a director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, trust or other enterprise, or by reason of any
action or inaction on the part of Indemnitee while serving in such capacity
(hereinafter an "Indemnifiable Event") against any and all expenses (including
attorneys' fees and all other costs, expenses and obligations incurred in
connection with investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, be a witness in or participate
in, any such action, suit, proceeding, alternative dispute resolution mechanism,
hearing, inquiry or investigation), judgments, fines, penalties and amounts paid
in settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) of such Claim and any federal,
state, local or foreign taxes imposed on the Indemnitee as a result of the
actual or deemed receipt of any payments under this Agreement (collectively,
hereinafter "Expenses"), including all interest, assessments and other charges
paid or payable in connection with or in respect of such Expenses. Such payment
of Expenses shall be made by the Company as soon as practicable but in any event
no later than thirty (30) days after written demand by Indemnitee therefor is
presented to the Company.

                  (b) Reviewing Party. Notwithstanding the foregoing, (i) the
obligations of the Company under Section l(a) shall be subject to the condition
that the Reviewing Party (as defined in Section 10(e) hereof) shall not have
determined (in a written opinion, in any case in which the Independent Legal
Counsel (as defined in Section 10(d) hereof) referred to in Section 1(c) hereof
is involved) that Indemnitee would not be permitted to be indemnified under
applicable law, and (ii) the obligation of the Company to make an advance
payment of Expenses to Indemnitee pursuant to Section 2(a) (an "Expense
Advance") shall be subject to the condition that, if, when and to the extent
that the Reviewing Party determines that Indemnitee would not be permitted to be
so indemnified under applicable law, the Company shall be entitled to be
reimbursed by Indemnitee (who hereby agrees to reimburse the Company) for all
such amounts theretofore paid; provided, however, that if Indemnitee has
commenced or thereafter commences legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be indemnified
under applicable law, any determination made by the Reviewing Party that
Indemnitee would not be permitted to be indemnified under applicable law shall
not be binding and Indemnitee shall not be required to reimburse the Company for
any Expense Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been exhausted or
lapsed). Indemnitee's obligation to reimburse the Company for any Expense
Advance shall be unsecured and no interest shall be charged thereon. If there
has not been a Change in Control (as defined in Section 10(c) hereof), the
Reviewing Party shall be selected by the Board of Directors, and if there has
been such a Change in Control (other than a Change in Control which has been
approved by a majority of the Company's Board of Directors who were directors
immediately prior to such Change in Control), the Reviewing Party shall be the
Independent Legal Counsel referred to in Section l(c) hereof. If there has been
no determination by the Reviewing Party or if the Reviewing Party determines
that Indemnitee substantively would not be permitted to be indemnified in whole
or in part under applicable law, Indemnitee shall have the right to commence
litigation seeking an initial determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, including the legal
or factual

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bases therefor, and the Company hereby consents to service of process and to
appear in any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and Indemnitee.

                  (c) Change in Control. The Company agrees that if there is a
Change in Control of the Company (other than a Change in Control which has been
approved by a majority of the Company's Board of Directors who were directors
immediately prior to such Change in Control) then with respect to all matters
thereafter arising concerning the rights of Indemnitee to payments of Expenses
and Expense Advances under this Agreement or any other agreement or under the
Company's Certificate of Incorporation, as amended from time to time (the
"Certificate of Incorporation") or Bylaws as now or hereafter in effect (the
"Bylaws"), the Company shall seek legal advice only from Independent Legal
Counsel selected by Indemnitee and approved by the Company (which approval shall
not be unreasonably withheld). Such counsel, among other things, shall render
its written opinion to the Company and Indemnitee as to whether and to what
extent Indemnitee would be permitted to be indemnified under applicable law. The
Company agrees to pay the reasonable fees of the Independent Legal Counsel
referred to above and to fully indemnify such counsel against any and all
expenses (including attorneys' fees), claims, liabilities and damages arising
out of or relating to this Agreement or its engagement pursuant hereto.

                  (d) Mandatory Payment of Expenses. Notwithstanding any other
provision of this Agreement other than Section 8 hereof, to the extent that
Indemnitee has been successful on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in defense of any
action, suit, proceeding, inquiry or investigation referred to in Section (1)(a)
hereof or in the defense of any claim, issue or matter therein, Indemnitee shall
be indemnified against all Expenses incurred by Indemnitee in connection
therewith.

         2. Expenses; Indemnification Procedure.

                  (a) Advancement of Expenses. The Company shall advance all
Expenses incurred by Indemnitee. The advances to be made hereunder shall be paid
by the Company to Indemnitee as soon as practicable but in any event no later
than five (5) days after written demand by Indemnitee therefor to the Company.

                  (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to Indemnitee's right to be indemnified under this
Agreement, give the Company notice in writing as soon as practicable of any
Claim made against Indemnitee for which indemnification will or could be sought
under this Agreement. Notice to the Company shall be directed to the President
of the Company at the address shown on the signature page of this Agreement (or
such other address as the Company shall designate in writing to Indemnitee). In
addition, Indemnitee shall give the Company such information and cooperation as
it may reasonably require and as shall be within Indemnitee's power.

                  (c) No Presumptions; Burden of Proof. For purposes of this
Agreement, the termination of any claim, action, suit or proceeding, by
judgment, order, settlement (whether with

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or without court approval) or conviction, or upon a plea of nolo contendere, or
its equivalent, shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law. In addition,
neither the failure of the Reviewing Party to have made a determination as to
whether Indemnitee has met any particular standard of conduct or had any
particular belief, nor an actual determination by the Reviewing Party that
Indemnitee has not met such standard of conduct or did not have such belief,
prior to the commencement of legal proceedings by Indemnitee to secure a
judicial determination that Indemnitee should be indemnified under applicable
law, shall be a defense to Indemnitee's claim or create a presumption that
Indemnitee has not met any particular standard of conduct or did not have any
particular belief. In connection with any determination by the Reviewing Party
or otherwise as to whether the Indemnitee is entitled to be indemnified
hereunder, the burden of proof shall be on the Company to establish that
Indemnitee is not so entitled.

                  (d) Notice to Insurers. If, at the time of the receipt by the
Company of a notice of a Claim pursuant to Section 2(b) hereof, the Company has
liability insurance in effect which may cover such Claim, the Company shall give
prompt notice of the commencement of such Claim to the insurers in accordance
with the procedures set forth in such policy or policies. The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of the Indemnitee, all amounts payable as a result of such action,
suit, proceeding, inquiry or investigation in accordance with the terms of such
policies.

                  (e) Assumption of Defense; Selection of Counsel. In the event
the Company shall be obligated hereunder to pay the Expenses of any action,
suit, proceeding, inquiry or investigation, the Company, if appropriate, shall
be entitled to assume the defense of such action, suit, proceeding, inquiry or
investigation with counsel approved by Indemnitee (which approval shall not be
unreasonably withheld), upon the delivery to Indemnitee of written notice of its
election so to do. After delivery of such notice, approval of such counsel by
Indemnitee and the retention of such counsel by the Company, the Company will
not be liable to Indemnitee under this Agreement for any fees of counsel
subsequently incurred by Indemnitee with respect to the same action, suit,
proceeding, inquiry or investigation; provided that, (i) Indemnitee shall have
the right to employ Indemnitee's counsel in any such action, suit, proceeding,
inquiry or investigation at Indemnitee's expense, and (ii) if (A) the employment
of counsel by Indemnitee has been previously authorized by the Company or (B)
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and Indemnitee in the conduct of any such defense.
Notwithstanding the foregoing, in the event the Company shall not continue to
retain such counsel to defend such action, suit, proceeding, inquiry or
investigation, then the fees and expenses of Indemnitee's counsel shall be at
the expense of the Company.

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         3. Additional Indemnification Rights; Nonexclusivity.

                  (a) Scope. The Company hereby agrees to indemnify the
Indemnitee to the fullest extent permitted by law, notwithstanding that such
indemnification is not specifically authorized by the other provisions of this
Agreement, the Company's Certificate of Incorporation, the Company's Bylaws or
by statute. In the event of any change after the date of this Agreement in any
applicable law, statute or rule which expands the right of a Delaware
corporation to indemnify a member of its Board of Directors or an officer,
employee, agent or fiduciary, it is the intent of the parties hereto that
Indemnitee shall enjoy by this Agreement the greater benefits afforded by such
change. In the event of any change in any applicable law, statute or rule which
narrows the right of a Delaware corporation to indemnify a member of its Board
of Directors or an officer, employee, agent or fiduciary, such change, to the
extent not otherwise required by such law, statute or rule to be applied to this
Agreement, shall have no effect on this Agreement or the parties' rights and
obligations hereunder.

                  (b) Nonexclusivity. The indemnification provided by this
Agreement shall be in addition to any rights to which Indemnitee may be entitled
under the Company's Certificate of Incorporation, its Bylaws, any agreement, any
vote of stockholders or disinterested directors, the General Business Law of the
State of Delaware, or otherwise. The indemnification provided under this
Agreement shall continue as to Indemnitee for any action taken or not taken
while serving in an indemnified capacity even though Indemnitee may have ceased
to serve in such capacity.

         4. No Duplication of Payments. The Company shall not be liable under
this Agreement to make any payment in connection with any action, suit,
proceeding, inquiry or investigation made against Indemnitee to the extent
Indemnitee has otherwise actually received payment (under any insurance policy,
Certificate of Incorporation, Bylaws or otherwise) of the amounts otherwise
indemnifiable hereunder.

         5. Partial Indemnification. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of Expenses in the investigation, defense, appeal or settlement of any
civil or criminal action, suit, proceeding, inquiry or investigation, but not,
however, for all of the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion of such Expenses to which Indemnitee is
entitled.

         6. Mutual Acknowledgment. Both the Company and Indemnitee acknowledge
that in certain instances, Federal law or applicable public policy may prohibit
the Company from indemnifying its directors, officers, employees, agents or
fiduciaries under this Agreement or otherwise. Indemnitee understands and
acknowledges that the Company has undertaken or may be required in the future to
undertake with the Securities and Exchange Commission to submit the question of
indemnification to a court in certain circumstances for a determination of the
Company's right under public policy to indemnify Indemnitee.

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         7. Liability Insurance. To the extent the Company maintains liability
insurance applicable to directors, officers, employees, agents or fiduciaries,
Indemnitee shall be covered by such policies in such a manner as to provide
Indemnitee the same rights and benefits as are accorded to the most favorably
insured of the Company's directors, if Indemnitee is a Director; or of the
Company's officers, if Indemnitee is not a director of the Company but is an
officer; or of the Company's key employees, agents or fiduciaries, if Indemnitee
is not an officer or director but is a key employee, agent or fiduciary.

         8. Exceptions. Any other provision herein to the contrary
notwithstanding, the Company shall not be obligated pursuant to the terms of
this Agreement:

                  (a) Excluded Action or Omissions. To indemnify Indemnitee for
acts, omissions or transactions from which Indemnitee may not be relieved of
liability under applicable law.

                  (b) Claims Initiated by Indemnitee. To indemnify or advance
expenses to Indemnitee with respect to proceedings or claims initiated or
brought voluntarily by Indemnitee and not by way of defense, except (i) with
respect to proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other agreement or insurance policy
or under the Company's Certificate of Incorporation or Bylaws now or hereafter
in effect relating to Claims for Indemnifiable Events, (ii) in specific cases if
the Board of Directors has approved the initiation or bringing of such suit, or
(iii) as otherwise required under Section 145 of the Delaware General
Corporation Law, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, advance expense payment or insurance recovery,
as the case may be.

                  (c) Lack of Good Faith. To indemnify Indemnitee for any
expenses incurred by the Indemnitee with respect to any proceeding instituted by
Indemnitee to enforce or interpret this Agreement, if a court of competent
jurisdiction determines that each of the material assertions made by the
Indemnitee in such proceeding was not made in good faith or was frivolous.

                  (d) Claims Under Section 16(b). To indemnify Indemnitee for
expenses and the payment of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934, as amended, or any similar successor statute.

         9. Period of Limitations. No legal action shall be brought and no cause
of action shall be asserted by or in the right of the Company against
Indemnitee, Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two (2) years from the date of accrual
of such cause of action, and any claim or cause of action of the Company shall
be extinguished and deemed released unless asserted by the timely filing of a
legal action within such two (2) year period; provided, however, that if any
shorter period of limitations is otherwise applicable to any such cause of
action, such shorter period shall govern.

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         10. Construction of Certain Phrases.

                  (a) For purposes of this Agreement, references to the
"Company" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
a consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, employees,
agents or fiduciaries, so that if Indemnitee is or was a director, officer,
employee, agent or fiduciary of such constituent corporation, or is or was
serving at the request of such constituent corporation as a Director, officer,
employee, agent or fiduciary of another corporation, partnership, joint venture,
employee benefit plan, trust or other enterprise, Indemnitee shall stand in the
same position under the provisions of this Agreement with respect to the
resulting or surviving corporation as Indemnitee would have with respect to such
constituent corporation if its separate existence had continued.

                  (b) For purposes of this Agreement, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on Indemnitee with respect to an employee
benefit plan; and references to "serving at the request of the Company" shall
include any service as a Director, officer, employee, agent or fiduciary of the
Company which imposes duties on, or involves services by, such Director,
officer, employee, agent or fiduciary with respect to an employee benefit plan,
its participants or its beneficiaries; and if Indemnitee acted in good faith and
in a manner Indemnitee reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan, Indemnitee shall be
deemed to have acted in a manner "not opposed to the best interests of the
Company" as referred to in this Agreement.

                  (c) For purposes of this Agreement a "Change in Control" shall
be deemed to have occurred if (i) any "person" (as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than
a trustee or other fiduciary holding securities under an employee benefit plan
of the Company or a corporation owned directly or indirectly by the stockholders
of the Company in substantially the same proportions as their ownership of stock
of the Company, is or becomes the "beneficial owner" (as determined in
accordance with Rule 13d-3 under such Act), directly or indirectly, of
securities of the Company representing more than twenty percent (20%) of the
total voting power represented by the Company's then outstanding Voting
Securities (as defined in Section 10(e) hereof), (ii) during any period of two
(2) consecutive years, individuals who at the beginning of such period
constitute the Board of Directors of the Company and any new director whose
election by the Board of Directors or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof, or (iii) the stockholders
of the Company approve a merger or consolidation of the Company with any other
corporation other than a merger or consolidation which would result in the
Voting Securities of the Company outstanding immediately prior thereto
continuing to

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represent (either by remaining outstanding or by being converted into Voting
Securities of the surviving entity) at least eighty percent (80%) of the total
voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
the stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of (in one
transaction or a series of transactions) all or substantially all of the
Company's assets.

                  (d) For purposes of this Agreement, "Independent Legal
Counsel" shall mean an attorney or firm of attorneys, selected in accordance
with the provisions of Section 1(c) hereof, who shall not have otherwise
performed services for the Company or Indemnitee within the last three (3) years
(other than with respect to matters concerning the rights of Indemnitee under
this Agreement, or of other indemnitees under similar indemnity agreements).

                  (e) For purposes of this Agreement, a "Reviewing Party" shall
mean any appropriate person or body consisting of a member or members of the
Company's Board of Directors or any other person or body appointed by the Board
of Directors who is not a party to the particular Claim for which Indemnitee is
seeking indemnification, or Independent Legal Counsel.

                  (f) For purposes of this Agreement, "Voting Securities" shall
mean any securities of the Company that vote generally in the election of
directors.

         11. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original.

         12. Binding Effect; Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors and assigns, including any direct or
indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company, spouses, heirs,
and personal and legal representatives. The Company shall require and cause any
successor (whether direct or indirect by purchase, merger, consolidation or
otherwise) to all, substantially all, or a substantial part, of the business
and/or assets of the Company, by written agreement in form and substance
satisfactory to Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform if no such succession had taken place. This Agreement shall
continue in effect regardless of whether Indemnitee continues to serve as a
director of the Company or of any other enterprise at the Company's request.

         13. Attorneys' Fees. In the event that any action is instituted by
Indemnitee under this Agreement or under any liability insurance policies
maintained by the Company to enforce or interpret any of the terms hereof or
thereof, Indemnitee shall be entitled to be paid all Expenses incurred by
Indemnitee with respect to such action, regardless of whether Indemnitee is
ultimately successful in such action, and shall be entitled to the advancement
of Expenses with respect to such action, unless as a part of such action the
court of competent jurisdiction over such action determines that each of the
material assertions made by Indemnitee as a basis for such action were

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not made in good faith or were frivolous. In the event of an action instituted
by or in the name of the Company under this Agreement to enforce or interpret
any of the terms of this Agreement, Indemnitee shall be entitled to be paid all
Expenses incurred by Indemnitee in defense of such action (including costs and
expenses incurred with respect to Indemnitee's counterclaims and cross-claims
made in such action), and shall be entitled to the advancement of Expenses with
respect to such action, unless as a part of such action the court having
jurisdiction over such action determines that each of Indemnitee's material
defenses to such action were made in bad faith or were frivolous.

         14. Notice. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt, or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Addresses for
notice to either party are as shown on the signature page of this Agreement, or
as subsequently modified by written notice.

         15. Consent to Jurisdiction. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of
or relates to this Agreement and agree that any action instituted under this
Agreement shall be commenced, prosecuted and continued only in the Superior
Court of Chancery of the State of Delaware in and for New Castle County, which
shall be the exclusive and only proper forum for adjudicating such a claim.

         16. Severability. The provisions of this Agreement shall be severable
in the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including, without limitations, each portion of this Agreement containing any
provision held to be invalid, void or otherwise unenforceable, that is not
itself invalid, void or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.

         17. Choice of Law. This Agreement shall be governed by and its
provisions construed and enforced in accordance with the laws of the State of
Delaware, as applied to contracts between Delaware residents, entered into and
to be performed entirely within the State of Delaware without regard to the
conflict of laws principles thereof.

         18. Subrogation. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee, who shall execute all documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.

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         19. Amendment and Termination. No amendment, modification, termination
or cancellation of this Agreement shall be effective unless it is in writing
signed by both of the parties hereto. No waiver of any of the provisions of this
Agreement shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar) nor shall such waiver constitute a continuing
waiver.

         20. Integration and Entire Agreement. This Agreement sets forth the
entire understanding between the parties hereto and supersedes and merges all
previous written and oral negotiations, commitments, understandings and
agreements relating to the subject matter hereof between the parties hereto.

         21. No Construction as Employment Agreement. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries.

                                   **********

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

                                        COOPERATIVE HOLDINGS, INC.

                                        By:
                                           ------------------------------------
                                           Louis Lombardi, Sr., President and
                                           Chief Executive Officer
                                           412-420 Washington Avenue
                                           Belleville, New Jersey  07109

AGREED TO AND ACCEPTED:

INDEMNITEE:

----------------------------------
         (signature)

----------------------------------
    (name of Indemnitee)

----------------------------------

----------------------------------
           (address)<PAGE>   1
                                                                    Exhibit 10.4

                             EMPLOYMENT AGREEMENT

      THIS AGREEMENT made effective as of the 20th day of March, 2000 (the
"Effective Date") by and between Cooperative Holdings, Inc., a Delaware
corporation with its principal place of business at 412-420 Washington
Avenue, Belleville, New Jersey 07109 (the "Company"), and Louis A. Lombardi,
Sr. (the "Employee").

                                    WITNESSETH:

      WHEREAS, the Company desires to secure the employment of the Employee
in accordance with the provisions of this Agreement; and

      WHEREAS, the Employee desires and is willing to accept employment with
the Company in accordance herewith.

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

      1.    Term.  The Company hereby agrees to employ the Employee and the
Employee hereby agrees to serve the Company pursuant to the terms and
conditions of this Agreement as President and Chief Executive Officer of the
Company, or in a position at least commensurate therewith in all material
respects, for a term commencing on the Effective Date hereof and expiring on
the third anniversary thereof (the "Initial Term"), provided that the
Employee is elected to such office, or a comparable or higher office, at the
annual meeting of the Board of Directors of the Company (the "Board of
Directors") during the Initial Term or any Renewal Term (as hereinafter
defined) of this Agreement.  If the Employee shall not be so elected at any
such annual meeting of the Board of Directors, the Employee's employment
hereunder shall forthwith terminate and the Company shall be obligated to
compensate the Employee in
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accordance with Section 6(a) of this Agreement. Upon the expiration of the
Initial Term, this Agreement will be renewed automatically for successive
one-year periods (each, a "Renewal Term"), unless sooner terminated in
accordance with the provisions of Section 5 or unless either party gives written
notice of non-renewal at least four (4) months prior to the date on which the
Employee's employment would otherwise end.

      2.    Positions and Duties.

      The Employee's duties hereunder shall be those which shall be
prescribed from time to time by the Board of Directors in accordance with the
Bylaws of the Company and shall include such executive duties, powers and
responsibilities as customarily attend the offices of President and Chief
Executive Officer of a company comparable to the Company.  The Employee will
hold, in addition to the offices of President and Chief Executive Officer of
the Company, such other executive offices in the Company and its subsidiaries
to which he may be elected, appointed or assigned by the Board of Directors
from time to time and will discharge such executive duties in connection
therewith.  During the employment period, the Employee's position (including
status, offices and reporting requirements), authority, duties and
responsibilities shall be at least commensurate in all material respects with
the most significant of those held, exercised and assigned immediately
preceding the Effective Date.  The Employee shall devote his full working
time, energy and skill (reasonable absences for vacations and illness
excepted), to the business of the Company as is necessary in order to perform
such duties faithfully, competently and diligently; provided, however, that
notwithstanding any provision in this Agreement to the contrary, the Employee
shall not be precluded from devoting reasonable periods of time required for
serving as a member of boards of companies or organizations which have been
approved by the Board of

                                       2
<PAGE>   3
Directors so long as such memberships or activities do not interfere with the
performance of the Employee's duties hereunder.

      3.    Compensation.  During the term of this Agreement, the Employee
shall receive, for all services rendered to the Company hereunder, the
following (hereinafter referred to as "Compensation"):

            (a)   Base Salary.  For the term hereof, the Employee shall be
paid an annual base salary equal to Two Hundred Twenty-Five Thousand Dollars
($225,000).  The Employee's annual base salary shall be payable in equal
installments in accordance with the Company's general salary payment policies
but no less frequently than monthly.  Such base salary shall be reviewed, and
any increases in the amount thereof shall be determined, by the Board of
Directors or a compensation committee formed by the Board of Directors (the
"Compensation Committee") at the end of each calendar year during the term
hereof.

            (b)   Bonuses.  The Employee shall be eligible for an annual
performance bonuses.  The amount of such bonus, if any, shall be solely
within the discretion of the Board of Directors or, if formed, the
Compensation Committee thereof and shall be based upon the respective
performances of the Company and the Employee during such year.  Such bonus,
if any, shall be paid within sixty (60) days after the end of each fiscal
year of the Company.  The Employee shall be eligible for and may receive
other bonus compensation.  The amount of such bonuses, if any, shall be
solely within the discretion of the Board of Directors or, if formed, the
Compensation Committee thereof.

            (c)   Incentive Compensation.  The Employee shall be eligible for
awards from the Company's incentive compensation plans, including without
limitation any stock option

                                       3
<PAGE>   4
plans, applicable to high level executive officers of the Company or to key
employees of the Company or its subsidiaries, in accordance with the terms
thereof and on a basis commensurate with his position and responsibilities.

            (d)   Benefits.  The Employee and his "dependents," as that term
may be defined under the applicable benefit plan(s) of the Company, shall be
included, to the extent eligible thereunder, in any and all plans, programs
and policies which provide benefits for employees and their dependents.  Such
plans, programs and policies may include health care insurance, long-term
disability plans, supplemental disability insurance, supplemental life
insurance, 401(k) plan, holidays and other similar or comparable benefits
made available to the Company's employees.

            (e)   Life Insurance.  The Company shall provide the Employee
with Fifty Thousand ($50,000) of term life insurance coverage while employed
by the Company.

            (f)   Expenses.  Subject to and in accordance with the Company's
policies and procedures, the Employee hereby is authorized to incur, and,
upon presentation of itemized accounts, shall be reimbursed by the Company
for, any and all reasonable and necessary business-related expenses, which
expenses are incurred by the Employee on behalf of the Company or any of its
subsidiaries.

      4.    Absences.  The Employee shall be entitled to vacations, 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 same may be amended from time-to-time.

                                       4
<PAGE>   5
      5.    Termination.  In addition to the events of termination and
expiration of this Agreement provided for in Section 1 hereof, the Employee's
employment hereunder may be terminated only as follows:

            (a)   Without Cause.  The Company may terminate the Employee's
employment hereunder without cause only upon action by the Board of
Directors, and upon no less than ninety (90) days prior written notice to the
Employee.  The Employee may terminate employment hereunder without cause upon
no less than ninety (90) days prior written notice to the Company.

            (b)   For Cause, by the Company.  The Company may terminate the
Employee's employment hereunder for cause immediately and with prompt notice
to the Employee, which cause shall be determined in good faith solely by the
Board of Directors.  "Cause" for termination shall include, but is not
limited to, the following conduct of the Employee:

                  (1)   Willful or prolonged absence from work by the
Employee (other than by reason of disability due to physical or mental
illness) or failure, neglect or refusal by the Employee to perform his duties
and responsibilities or to follow the reasonable directions of the Board of
Directors within ten (10) business days after receipt by the Employee of
written notice of such failure;

                  (2)   Misconduct by the Employee in connection with his
employment, including but not limited to: misappropriating any funds or
property of the Company; attempting to willfully obtain any personal profit
from any transaction in which the Employee has an interest which is adverse
to the interests of the Company; or any other intentional act or omission
which substantially impairs the Company's ability to conduct its ordinary
business in its usual manner;

                                       5
<PAGE>   6
                  (3)   The Employee's conviction of, or plea of nolo
contendre to, any crime constituting a felony under the laws of the United
States or any State thereof, or any crime constituting a misdemeanor under
any such law involving moral turpitude;

                  (4)   Breach by the Employee of any of the terms of or
covenants contained in this Agreement; or

                  (5)   Any other act or omission which subjects the Company
or any of its subsidiaries to substantial public disrespect, scandal or
ridicule.

            (c)   For Good Reason by Employee. The Employee may terminate his
employment hereunder for good reason immediately and with prompt notice to
the Company.  "Good reason" for termination by the Employee shall include,
but is not limited to, the following conduct of the Company:

                  (1)   Material breach of any provision of this Agreement by
the Company, which breach shall not have been cured by the Company within
thirty (30) days of receipt of written notice of said breach;

                  (2)   Failure to maintain the Employee in a position
commensurate with that referred to in Section 2 of this Agreement; or

                  (3)   The assignment to the Employee of any duties
inconsistent with the Employee's position, authority, duties or
responsibilities as contemplated by Section 2 of this Agreement, or any other
action by the Company which results in a diminution of such position,
authority, duties or responsibilities, excluding for this purpose any
isolated action not taken in bad faith and which is promptly remedied by the
Company after receipt of notice thereof given by the Employee.

                                       6
<PAGE>   7
      It is understood and agreed that it shall not be "good reason" for
termination by the Employee if in the event of a Change in Control (as
hereinafter defined in Section 7) the Employee is offered a position
commensurate with his position with the Company immediately prior to the
Change in Control with the company, division, subsidiary or business unit
whose business is comprised of the former operations of the Company.

            (d)   Death.  The period of active employment of the Employee
hereunder shall terminate automatically in the event of his death.

            (e)   Disability.  In the event that the Employee shall be unable
to perform duties hereunder for a period of one hundred eighty (180)
consecutive calendar days or two hundred and seventy (270) work days within
any three hundred and sixty (360) consecutive calendar days by reason of
disability as a result of illness, accident or other physical or mental
incapacity or disability, the Company may, in its discretion, by giving
written notice to the Employee, terminate the Employee's employment hereunder
as long as the Employee is still disabled on the effective date of such
termination.

            (f)   Mutual Agreement.  This Agreement may be terminated at any
time by mutual agreement of the Employee and the Company.

      6.    Compensation in the Event of Termination.  In the event that the
Employee's employment pursuant to this Agreement terminates prior to the end
of the term of this Agreement because he is not reelected pursuant to Section
1 or for a reason provided in Section 5 hereof, the Company shall pay the
Employee compensation as set forth below:

            (a)   Employee not Elected by Board of Directors; By Employee for
Good Reason; By Company Without Cause; Death or Disability.  In the event
that the Employee's

                                       7
<PAGE>   8
employment hereunder is terminated: (i) because the Employee is not elected to
the offices of President and Chief Executive Officer of the Company, or in a
position at least commensurate therewith in all material respects, at any annual
meeting of the Company's Board of Directors during the term of this Agreement,
as contemplated by Section 1 hereof; (ii) by the Employee for good reason
pursuant to Section 5(c) hereof; (iii) by the Company without cause; (iv)
because of the death of the Employee; or (v) by the Company pursuant to Section
5(e) hereof, then the Company shall continue to pay or provide, as applicable,
the following compensation to the Employee:

                  (1)   Monthly base salary as set forth in Section 3(a)
hereof; and

                  (2)   Continuing coverage, but only to the extent required
by law, for the Employee and his eligible dependents under all of the
Company's benefit plans, programs and policies in effect as of the date of
termination.

                  Such compensation shall continue to be paid or provided, as
applicable, in the same manner as before termination, and for a period of
time ending on the later to occur of (A) the date which is twelve (12) months
after the date of termination or (B) the date upon which the term of this
Agreement would otherwise have expired in accordance with Section 1 hereof.

      (b) By Company For Cause or By Employee Without Good Reason. In the event
that (i) the Company shall terminate the Employee's employment hereunder for
cause pursuant to Section 5(b) hereof or (ii) the Employee shall terminate
employment hereunder without "good reason" as provided in Section 5(c) hereof,
the Company shall not be obligated to pay the Employee any compensation except
for salary and other Compensation which may have been earned and are due and
payable but which have not been paid as of the date of termination.

                                       8
<PAGE>   9
      7.    Change of Control.

            (a)   The term "Change in Control" as used in this Agreement
shall mean the first to occur of any of the following:

                  (i)   the effective date or date of consummation of any
transaction or series of transactions (other than a transaction to which only
the Company and one or more of its subsidiaries are parties) pursuant to
which the Company (1) becomes a subsidiary of another corporation or entity;
(2) is merged or consolidated with or into another corporation or entity; (3)
engages in an exchange of shares with another corporation or an exchange of
interests with another entity; or (4) transfers, sells or otherwise disposes
of all or substantially all of its assets to a single purchaser (other than
the Employee) or a group of purchasers (none of whom is the Employee);
provided, however, that this Subsection shall not be applicable to a
transaction or series of transactions in which a majority of the capital
stock of the other corporation, following such transaction or series of
transactions, is owned or controlled by the holders of a majority of the
Company's outstanding capital stock immediately before such sale, transfer or
disposition; or

                  (ii)  The date upon which any person (other than the
Employee), group of associated persons acting in concert (none of whom is the
Employee), or corporation or other entity becomes a direct or indirect
beneficial owner of shares of stock of the Company representing an aggregate
of more than fifty percent (50%) of the votes then entitled to be cast at an
election of directors of the Company; or

                  (iii) The date upon which the persons who were members of
the Board of Directors of the Company as of the date hereof (the "Original
Directors") cease to constitute a majority of the Board of Directors;
provided, however, that any new director whose nomination or

                                       9
<PAGE>   10
selection has been approved by the affirmative vote of at least three of the
Original Directors then in office shall also be deemed an Original Director.

            (b)   If, during the six-month period either immediately
preceding or immediately following a Change in Control, the Employee's
employment with the Company is terminated for any reason other than pursuant
to Sections 5(b), (d) or (e) hereof or a termination without cause by the
Employee pursuant to Section 5(a), then, in addition to the amounts payable
under Section 6 hereof, the Company shall pay the Severance Amount
(hereinafter defined) within thirty (30) days of the occurrence of the Change
in Control, or, in the event such termination occurred during the six-month
period following the occurrence of the Change in Control, within thirty (30)
days after the effective date of the Employee's termination.  For purposes of
this Agreement, Severance Amount shall mean an amount equal to twelve (12)
times the rate of the Employee's monthly regular compensation as in effect
immediately prior to the Employee's termination or immediately prior to the
Change in Control, as applicable.

      8.    Effect of Termination.  In the event of expiration or early
termination of this Agreement as provided herein, neither the Company nor the
Employee shall have any remaining duties or obligations hereunder except that
the Company shall:

                  (a)   Pay the Employee's accrued and unpaid salary and any
other accrued and unpaid benefits under Section 3 hereof;

                  (b)   Reimburse the Employee for expenses already incurred
in accordance with Section 3(e) hereof;

                                       10
<PAGE>   11
                  (c)   To the extent required by law, pay or otherwise
provide for any benefits, payments or continuation or conversion rights in
accordance with the provisions of any benefit plan of which the Employee or
any of his dependents is or was a participant; and

                  (d)   Pay the Employee or his beneficiaries any
compensation due pursuant to Sections 6 and 7 hereof, if any.

      9.    Non-Competition.  The Employee acknowledges that he has gained
and will gain extensive and valuable experience and knowledge in the business
conducted by the Company and has been and will have extensive contacts with
its customers.  Accordingly, the Employee covenants and agrees that he shall
not compete directly or indirectly with the Company, either during the term
of his employment or during the twelve (12) month period immediately
thereafter and shall not during such period make public statements in
derogation of it.  For the purposes of Sections 9, 10, 11, 12 and 13, the
word "Company" shall be deemed to include subsidiaries, parents and its
affiliates.  Competing directly or indirectly shall mean engaging or having a
material interest, directly or indirectly, as owner, employee, officer,
director, partner, venturer, stockholder, capital investor, consultant,
agent, principal, advisor or otherwise, either alone or in association with
others, in the operation of an entity engaged in the business of providing
telecommunications services within thirty (30) miles of the Company's home
office or on an Internet Web Site.  Competing directly or indirectly with the
Employer as used in this Agreement, shall be deemed not to include an
ownership interest as an inactive investor, which for purposes of this
Agreement shall mean the beneficial ownership of less than five percent (5%)
of the outstanding shares of any series or class of securities of any
competitor of the Company, which shares are publicly traded in the securities
markets.

                                       11
<PAGE>   12
      10.   Non-Solicitation.  The Employee acknowledges that he has had and
will have extensive contacts with employees and customers of the Company.
Accordingly, the Employee covenants and agrees that during the term of his
employment and during the twelve (12) month period immediately thereafter he
will not (a) solicit any of the employees of the Company who were employed by
the Company during the time when the Employee was employed, to leave the
Company, (b) interfere with the relationship of the Company with any such
employees or (c) personally target or solicit customers of the Company.

      11.   Blue Pencil Provision.  The Employee acknowledges that the time
periods and geographic area of restriction imposed by Sections 9 and 10 are
fair and reasonable and are reasonably required for the protection of the
Company.  If any part or parts of Sections 9 or 10 shall be held to be
unenforceable or invalid, the remaining parts thereof shall nevertheless
continue to be valid and enforceable as though the invalid portion or
portions were not a part hereof.  If any of the provisions of Sections 9 or
10 relating to the periods or geographic area of restriction shall be deemed
to exceed the maximum periods of time or area which a court of competent
jurisdiction would deem enforceable, the times and area shall, for the
purposes of Sections 9 and 10, be deemed to be the maximum time periods and
area which a court of competent jurisdiction would deem valid and enforceable
in any state in which such court of competent jurisdiction shall be convened.

      12.   Confidentiality.  The Employee acknowledges that he has had and
will have access to certain information related to the business, operations,
future plans and customers of the Company, the disclosure or use of which
could cause it substantial losses and damages.  Accordingly, the Employee
covenants that during the term of his employment with the Company

                                       12
<PAGE>   13
and thereafter he will keep confidential all information and documents furnished
to him by or on behalf of the Company and not use the same to his advantage,
except to the extent such information or documents are or thereafter become
lawfully obtainable from other sources or are in the public domain through no
fault on his part or is consented to in writing by the Company. Upon termination
of his employment, the Employee shall return to the Company all records, lists,
files and documents which are in his possession and which relate to the Company.

      13.   Right to Injunctive Relief.  The Employee agrees and acknowledges
that a violation of the covenants contained in Sections 9, 10, 11 and 12 of
this Agreement will cause irreparable damage to the Company, and that it is
and will be impossible to estimate or determine the damage that will be
suffered by it in the event of a breach by the Employee of any such
covenant.  Therefore, the Employee further agrees that in the event of any
violation or threatened violation of such covenants, the Company shall be
entitled as a matter of course to an injunction out of any court of competent
jurisdiction restraining such violation or threatened violation by the
Employee, such right to an injunction to be cumulative and in addition to
whatever other remedies the Company may have.

      14.   Representation by the Employee.  The Employee hereby represents
and warrants that the execution of this Agreement and the performance of his
duties and obligations hereunder will not breach or be in conflict with any
other agreement to which he is a party or by which he is bound, and that he
is not now subject to any covenant against competition or similar covenant
which would affect the performance of his duties hereunder.

      15.   Resolution of Differences Over Breaches of Agreement.  Except as
otherwise provided herein, any controversy or claim arising out of, or
relating to, this Agreement, or the

                                       13
<PAGE>   14
breach hereof, shall be reviewed in the first instance in accordance with the
Company's internal review procedures, if any, with recourse thereafter--for
temporary or preliminary injunctive relief only--to the courts having
jurisdiction thereof, and if any relief other than injunctive relief is sought,
then to arbitration in Essex County, New Jersey in accordance with the rules of
the American Arbitration Association under its National Rules for the Resolution
of Employment Disputes, and judgment upon the award rendered by the
Arbitrator(s) may be entered in any court having jurisdiction thereof.

      16.   Waiver.  The waiver by a party hereto of any breach by the other
party hereto of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach by a party hereto.

      17.   Assignment.  This Agreement shall be binding upon and inure to
the benefit of the successors and assigns of the Company, and the Company
shall be obligated to require any successor to expressly assume its
obligations hereunder.  This Agreement shall inure to the benefit of and be
enforceable by the Employee or his legal representatives, executors,
administrators, successors, heirs, distributes, devisees and legatees.  The
Employee may not assign any of his duties, responsibilities, obligations or
positions hereunder to any person and any such purported assignment by him
shall be void and of no force and effect.

      18.   Notices.  Any notices required or permitted to be given under
this Agreement shall be sufficient if in writing, and if personally delivered
or when sent by first class certified or registered mail, postage prepaid,
return receipt requested--in the case of the Employee, to his residence
address as set forth below, and in the case of the Company, to the address of
its principal place of business as set forth below, in care of the Board of
Directors--or to such other

                                       14
<PAGE>   15
person or at such other address with respect to each party as such party shall
notify the other in writing.

      19.   Construction of Agreement.

            (a)   Governing Law.  This Agreement shall be governed by and its
provisions construed and enforced in accordance with the internal laws of the
State of New Jersey without reference to its principles regarding conflicts
of law.

            (b)   Severability.  In the event that any one or more of the
provisions of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

            (c)   Headings.  The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience of reference only
and shall not constitute a part of this Agreement.

      20.   Entire Agreement.  This Agreement contains the entire agreement
of the parties concerning the Employee's employment and all promises,
representations, understandings, arrangements and prior agreements, including
without limitation all offer letters and side letters, on such subject are
merged herein and superseded hereby.  The provisions of this Agreement may
not be amended, modified, repealed, waived, extended or discharged except by
an agreement in writing signed by the party against whom enforcement of any
amendment, modification, repeal, waiver, extension or discharge is sought. No
person acting other than pursuant to a resolution of the Board of Directors
shall have authority on behalf of the Company to agree to amend, modify,
repeal, waive, extend or discharge any provision of this Agreement or
anything in reference

                                       15
<PAGE>   16
thereto or to exercise any of the Company's rights to terminate or to fail to
extend this Agreement.

      21.   Survival of Certain Provisions.  Sections 6 and 7 hereof shall
survive termination of this Agreement and shall continue to be effective so
long as the Employee is employed by the Company in any capacity.

                               ******************

                                       16
<PAGE>   17
     IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed and attested by its duly authorized officers, and the Employee has
set his hand, all as of the day and year first above written.

ATTEST:                             COOPERATIVE HOLDINGS, INC.

/s/ Jay Brzezanski                  By: /s/ Louis A. Lombardi, Jr.
__________________________             _____________________________
Jay Brzezanski, Secretary                 Louis A. Lombardi, Jr.
                                          Chief Operating Officer

                                    Address: 412-420 Washington Avenue
                                             Belleville, New Jersey 07109

WITNESS:                            EMPLOYEE

/s/ Dawn Androsky                   /s/ Louis A. Lombardi, Sr.
__________________________          _______________________________
                                    Louis A. Lombardi, Sr.

                                    Address:  33 Crest Road
                                              Middletown, New Jersey  07748

                                       17

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