Document:

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EXHIBIT 10.16

                              EMPLOYMENT AGREEMENT
                              --------------------

         THIS EMPLOYMENT AGREEMENT (this "Agreement") is effective as of June 1,
2001 ("Effective Date"), by and between TANGIBLE ASSET GALLERIES, INC., a Nevada
corporation (the "Company"), and Silvano DiGenova, an individual ("Executive").

                                    RECITALS
                                    --------

         A. Subject to the terms and provisions of this Agreement, the Company
has offered to Executive the position of Chief Executive Officer of the Company,
and Executive accepts such offer.

         B. The Company and Executive desire to enter into a formal arrangement
as set forth herein.

                                   AGREEMENT
                                   ---------

         NOW, THEREFORE, in accordance with the recitals set forth above and AS
CONSIDERATION for the representations, warranties, covenants and agreements set
forth in this Agreement, as well as for other good and valuable consideration
the receipt and sufficiency of which hereby are acknowledged, the Company and
Executive hereby agree as follows:

         1. RECITALS AN INTEGRAL PART OF AGREEMENT. The recitals set forth above
are and for all purposes shall be interpreted as being an integral part of this
Agreement, constituting acknowledgments and agreements by and among the parties
hereto, and are incorporated in this Agreement by this reference.

         2. EMPLOYMENT. Subject to the terms and conditions set forth in this
Agreement, the Company hereby employs Executive, and Executive hereby accepts
employment with the Company, as the Company's Chief Executive Officer ("CEO").

         3. TERM. The term of Executive's employment under this Agreement shall
commence as of the Effective Date and shall continue until December 31, 2004
(the "Term"), unless earlier terminated as herein provided or by operation of
law. This Agreement may be terminated earlier as hereinafter provided.

         4. DUTIES AND SERVICES. Executive shall perform such duties and
functions as Executive is reasonably instructed to perform from time to time by
the Board of Directors of the Company (the "Board of Directors") that are
reasonably within the scope of the job descriptions of CEO. In the performance
of Executive's duties, Executive shall work full-time and shall comply with the
policies of the Company and be subject to the direction of the Board of
Directors.

         At all times during the Term, Executive shall perform Executive's
duties and obligations under this Agreement faithfully and diligently, shall
devote all of Executive's business time, attention, abilities and efforts
exclusively to the business of the Company and shall not accept other employment
or engage in any other outside business activity that interferes with the
performance of Executive's duties and responsibilities under this Agreement or
involves actual or prospective

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competition with the business of the Company. Executive shall perform
industriously Executive's duties under the supervision of and report to the
Board of Directors and shall accept and comply with all directions from and all
policies from time to time established by the Board of Directors.

         Executive shall not directly or indirectly render any service of a
business, commercial or professional nature to any other person, entity or
organization, for compensation, without the prior consent of the Board of
Directors: PROVIDED, HOWEVER, that the foregoing shall not preclude Executive
from (a) serving on boards of trade associations and/or charitable organizations
(subject to reasonable approval by the Board of Directors); (b) engaging in
charitable activities and community affairs, provided that such directorships
and activities do not interfere with the proper performance of Executive's
duties and responsibilities under this Agreement; and (c) engaging in business
related activity of a personal nature in managing the tangible and financial
assets of the Executive, including the buying and selling of such assets,
provided that such activity is not competitive with the activities of the
Company as now constituted, it being understood that any activity wholesale in
nature or the buying and selling of such assets through dealers or brokers or
auctioneers is deemed not to be competitive with the activities of the Company.

         If the Executive is not already serving as a member of the Company's
Board of Directors, the Company shall nominate Executive to be elected to the
Company's Board of Directors and the Executive agrees to serve on the Company's
Board of Directors as the Chairman. Executive shall serve in such capacity
without additional compensation, except that Executive may receive such
directors' fees or similar compensation as the Board of Directors may, in its
sole and absolute discretion, establish from time to time. At the request of the
Board of Directors or the board of directors of one or more subsidiaries of the
Company (individually, a "Subsidiary," and, collectively, "Subsidiaries") or of
any affiliate of the Company (individually, an "Affiliate," and, collectively,
"Affiliates"), Executive shall serve during the Term as a director of any such
Subsidiary or Affiliate without additional compensation, except that Executive
may receive such directors' fees or similar compensation as the board of
directors of the Subsidiaries or Affiliates may, in their sole and absolute
discretion, establish from time to time; and, in the performance of such duties,
Executive shall comply with the policies of the board of directors of each such
Subsidiary and Affiliate. Unless the context otherwise requires, for the
purposes of this Agreement, the term "Company" shall be deemed to include the
Company's Subsidiaries, if any, and the Company's Affiliates, if any.

         5. BASE SALARY. As compensation for the services rendered by Executive
under this Agreement, including all services rendered by Executive as an officer
or director of the Company (as applicable), the Company agrees to pay to
Executive, and Executive agrees to accept, a base salary at the annual rate of
Three Hundred Twenty Five Thousand Dollars ($325,000.00) (the "Base Salary"),
payable on the Company's regular payroll dates for salaried executives, and
subject to such withholdings and deductions as are required by law. The annual
rate for the Base Salary shall be adjusted every January 1st during the Term, by
a percentage equal to 110% of the percentage increase in the Consumer Price
Index of the Bureau of Labor Statistics of the U.S. Department of Labor for
Urban Wage Earners and Clerical Workers, Los Angeles-Anaheim-Riverside,
California ("CPI").

         6. ADDITIONAL COMPENSATION

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         (a) NONQUALIFIED STOCK OPTIONS. In addition to the Base Salary, within
thirty (30) days of the date on which the Company and Executive execute and
deliver this Agreement (the "Execution and Delivery Date"), the Company shall,
pursuant to Tangible Asset Galleries, Inc. 2000 Omnibus Stock Option Plan
("Plan"), grant to Executive nonqualified stock options ("Stock Options") to
purchase Five Hundred Thousand (500,000) shares of the Company's common stock
("Common Stock"), with an exercise price equal to the closing sales price of
Common Stock on the Execution and Delivery Date. The Stock Options shall vest in
thirty-six (36) equal monthly installments after the Execution and Delivery
Date, provided that Executive is employed by the Company on each such vesting
date. All Stock Options shall be exercisable for a period of five (5) years from
the date on which the Stock Options become exercisable, subject to earlier
termination or expiration as provided in this Agreement or any related stock
option agreement. All Stock Options shall be subject to all of the terms,
provisions and conditions of the Plan; PROVIDED, HOWEVER, the terms and
provisions of this Agreement shall supercede and control any inconsistency or
contradiction between the Plan and this Agreement. With respect to any Common
Stock issued or issuable to Executive upon exercise of Stock Options, Executive
shall execute all "market standoff" or "lock-up" agreements required by the
Company's underwriters to be executed by the Company's directors and officers
generally.

         (b) BONUS.

                  (i) PROFIT BONUS. Subject to the terms and conditions hereof,
Executive shall be entitled to an annual bonus ("Profit Bonus") based on a
certain percentage of the then Base Salary when Consolidated Annual Pre-Tax
Income (as defined below) equals amounts as follows:

    ----------------------------------------------------------------------------
    Consolidated Annual Pre-Tax Income                Percentage of Base Salary
    ----------------------------------------------------------------------------
    Up to $250,000                                    5.0%
    ----------------------------------------------------------------------------
    $250,001 to $500,000                              7.5%
    ----------------------------------------------------------------------------
    $500,001 to $1,000,000                            10.0%
    ----------------------------------------------------------------------------
    $1,000,001 to $1,500,000                          15.0%
    ----------------------------------------------------------------------------
    $1,500,001 to $2,000,000                          20.0%
    ----------------------------------------------------------------------------
    $2,000,001 to $3,000.000                          30.0%
    ----------------------------------------------------------------------------
    $3,000,001 to $4,000,000                          40.0%
    ----------------------------------------------------------------------------
    $4,000,001 and up                                 50.0%
    ----------------------------------------------------------------------------

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The Profit Bonus shall be earned on December 31 of each fiscal year during the
Term. The Profit Bonus shall be payable within one hundred twenty (120) days
after the end of each fiscal year for which the Profit Bonus is earned.
Executive shall be entitled to receive the Profit Bonus only if Executive is
employed at such time as the Profit Bonus is earned; PROVIDED, HOWEVER, that if
the Executive is employed with the Company for less than twelve (12) months
during such fiscal year, the Executive shall be entitled to a prorated portion
of the Profit Bonus that would be payable if the Executive were employed for the
entire fiscal year.

         For the purposes of this Agreement, "Consolidated Annual Pre-Tax
Income" means the Company's consolidated annual income from operations before
provision for (benefit from) any taxes and excluding all extraordinary earnings
and losses, as such term defined under GAAP. The Company shall determine the
Consolidated Annual Pre-Tax Income based on the Company's annual audited
consolidated financial statement as audited by a nationally-recognized
accounting firm and determined within one hundred twenty (120) days after the
end of the fiscal year.

                  (ii) ONE-TIME MARKET ACHIEVEMENT BONUS. Subject to the terms
and conditions hereto, Executive shall be entitled to a one-time bonus ("Market
Achievement Bonus") equal to twenty-five percent (25%) of the then Base Salary,
all payable in Common Stock of the Company (valued as of the date of payment),
at such time as the Company's market capitalization first exceeds Fifty Million
Dollars ($50,000,000); PROVIDED, HOWEVER, that the Company maintains such
capitalization for thirty (30) consecutive calendar days and that during such
period and any 90-day period encompassing such 30-day period, the average daily
volume of the Common Stock traded on a national exchange or NASDAQ divided by
the average total outstanding shares of the Common Stock exceeds 0.3%. The
Market Achievement Bonus shall be payable within sixty (60) days after the
satisfaction of the requirements under this subsection. Upon receipt of the
Market Achievement Bonus, Executive shall receive an additional cash bonus in an
amount equal to the tax liabilities assessed for such grant of the Common Stock.

                  (ii) MARKET CAPITALIZATION BONUS. Subject to the terms and
conditions hereto, Executive shall be entitled to an annual bonus ("Market
Capitalization Bonus"), all payable in the Common Stock (valued as of the date
of payment), equal to five percent (5%) of the Base Salary for each and any
fiscal year in which the average of the Company's market capitalization is
twenty percent (20%) above that of the preceding fiscal year ("Base Year");
PROVIDED, HOWEVER, that the Company's average market capitalization for that
Base Year exceeds Thirty Million Dollars ($30,000,000). Upon receipt of the
Market Capitalization Bonus, Executive shall receive an additional cash bonus in
an amount equal to the tax liabilities assessed for such grant of the Common
Stock. The Market Capitalization Bonus shall be earned at the end of each fiscal
year during the Term hereof and payable within ninety (90) days after the end of
the fiscal year for which the Market Capitalization Bonus is earned. Executive
shall be entitled to receive the Market Capitalization Bonus only if Executive
is employed at such time as the Market Capitalization Bonus is earned; PROVIDED
HOWEVER, that if the Executive is employed with the Company for less than twelve
(12) months during such fiscal year, the Executive shall be entitled to a
prorated portion of the Profit Bonus that would be payable if the Executive were
employed for the entire fiscal year.

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         (c) AUTOMOBILE ALLOWANCE. During the Term, the Company shall provide a
monthly automobile expense allowance up to One Thousand Five Hundred Dollars
($1,500) ("Automobile Allowance") for lease payment for an automobile leased by
the Company for Executive's business use, and any other related automobile
expenses; PROVIDED, HOWEVER, if the monthly automobile expenses exceeds the
Automobile Allowance, then Executive shall promptly reimburse the Company the
full amount of such excess in accordance with Company policy. The Company shall
retain any and all right to purchase the leased automobile upon termination of
and pursuant to the automobile lease.

         7. OTHER BENEFITS. During the Term, Executive shall generally be
eligible to participate in other benefits (if any) provided by the Company to
its senior management personnel or its employees generally. Such benefits may
include benefits provided under any profit sharing plan, 401(k) plan, stock
option plan, stock purchase plan, pension plan, short and long-term disability
insurance plan, hospital insurance plan, major medical insurance plan, dental
insurance plan, retirement plan and group life insurance plan in accordance with
the terms of such plans, as such plans may be in effect from time to time. The
Company shall pay all health care continuation fees in connection with the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, incurred by
Executive until Executive becomes eligible for full health care benefits as
provided in this Section 7. The Company reserves the right, in its sole and
absolute discretion, to amend, modify or discontinue any of such benefits for
all employees generally, in accordance with applicable law.

         8. VACATION. Unless for any given calendar year during the Term a
longer period of vacation for Executive is approved by the Board of Directors,
Executive shall accrue four (4) weeks of paid vacation each calendar year during
the Term in accordance with and subject to Company policy.

         9. INDEMNIFICATION INSURANCE; INDEMNIFICATION. During the Term, for the
period in which Executive is a director and/or officer of the Company, the
Company shall provide Executive with director's and officer's liability
insurance to the extent that such insurance is provided to other directors and
officers of the Company and is available at commercially reasonable premiums.
Such insurance shall be in such form, and shall provide for such coverage and
deductibles, as shall be commercially reasonable and standard for companies in
businesses and circumstances similar to those of the Company.

         10. REIMBURSEMENT OF EXPENSES. During the Term, the Company shall, upon
presentation of appropriate vouchers or receipts in accordance with the
Company's customary policies and practices, reimburse Executive for reasonable
and necessary out-of-pocket expenses paid for by Executive on behalf of the
Company in connection with the performance of Executive's duties under this
Agreement.

         11. TERMINATION.

         (a) TERMINATION BY THE COMPANY FOR DEATH, DISABILITY AND CAUSE.
Executive's employment under this Agreement shall be terminated upon the death
of Executive and also may be terminated by the Company giving appropriate
written notice of termination and effective

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immediately upon receipt of such notice by Executive upon the occurrence of any
of the following events:

                  (i) THE DISABILITY OF EXECUTIVE. For the purposes of this
Agreement, the term "Disability" shall mean the inability of Executive, due to
illness, accident or any other physical or mental impairment, to perform the
essential functions of Executive's position under this Agreement with reasonable
accommodation for a period of One Hundred Twenty (120) consecutive days, during
any twelve (12) consecutive months during the Term. The determination of whether
Executive is unable to perform the essential functions of Executive's position
with reasonable accommodation shall be made by an independent physician mutually
selected by the Company and Executive within five (5) days after the Company's
written request that Executive undergo an examination for such purpose. If the
Company and Executive are unable to agree within that time on the identity of
the physician who shall perform such examination, then the Company and Executive
each shall immediately appoint a physician experienced in evaluating the
disability at issue, and the two (2) appointed physicians together shall within
ten (10) days after such appointment mutually select and appoint a third
physician, similarly qualified, to conduct such examination. If the physicians
appointed by the Company and Executive are unable to agree upon such third
physician within such ten (10) days, then the appointment of such third
physician to examine Executive shall occur in accordance with the procedural
rules of JAMS referred to in subsection 16(a) of this Agreement. The Company
shall treat any and all medical information regarding Executive as confidential,
in accordance with applicable law. The Company and Executive acknowledge and
agree that, should Executive have a Disability as herein defined, continued
employment of Executive would constitute an undue hardship for the Company.

                  (ii) THE DETERMINATION THAT CAUSE EXISTS FOR SUCH TERMINATION.
For the purposes of this Agreement, the term "Cause" or "For Cause" shall mean
any of the following:

                           (A) Executive's material breach of any provision or
                  covenant of this Agreement, provided that Executive first
                  shall have received prior written notice from the Board of
                  Directors expressly addressed to Executive stating with
                  specificity the nature of such material breach and affording
                  Executive a reasonable opportunity, as soon as practicable,
                  but in no event more than thirty (30) days, to initiate
                  appropriate action to cure the material breach complained of;
                  or

                           (B) Executive's material failure or refusal to
                  perform Executive's duties as determined by the Board of
                  Directors consistent with Section 4, provided that Executive
                  first shall have received prior written notice from the Board
                  of Directors expressly addressed to Executive stating with
                  specificity the nature of such material failure or refusal and
                  affording Executive a reasonable opportunity, as soon as
                  practicable, but in no event more than thirty (30) days, to
                  initiate appropriate action to correct the acts or omissions
                  complained of; or

                           (C) Executive's material breach of any provision or
                  covenant of the Proprietary Information and Invention
                  Assignment Agreement referred to in Section 14 of this
                  Agreement and attached hereto as Exhibit C; or

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                           (D) Executive's conviction of, admission of guilt to,
                  or plea of NOLO CONTENDRE or similar plea (which, through
                  lapse of time or otherwise, is not subject to appeal) with
                  respect to any felony; or

                           (E) Executive's conviction of, admission of guilt to,
                  or plea of NOLO CONTENDRE or similar plea (which, through
                  lapse of time or otherwise, is not subject to appeal) with
                  respect to any crime or offense of theft, embezzlement, fraud,
                  misappropriation of funds or other act of dishonesty by
                  Executive involving money or other property of the Company or
                  any Subsidiary or Affiliate committed after the date of this
                  Agreement; or

                           (F) Executive's material violation of any Company
                  material policy, including, without limitation, any Company
                  policy relating to discrimination or harassment; or

                           (G) Executive's willful engagement in any violation
                  of law in Executive's capacity as CEO of the Company or any
                  breach by Executive of Executive's duty of loyalty to the
                  Company.

         (b) TERMINATION BY THE COMPANY WITHOUT CAUSE. Subject to the
obligations under Section 12(c) of this Agreement and notwithstanding anything
herein to the contrary, the Company may terminate Executive's employment at any
time by written notice to Executive. Termination of Executive's employment under
this Section 11(b) shall be effective thirty (30) days after Executive's receipt
of such termination notice.

         (c) VOLUNTARY TERMINATION BY EXECUTIVE. Executive may terminate
Executive's employment under this Agreement, for Good Reason or without Good
Reason, effective thirty (30) days after Executive's delivery to the Company of
written notice of such termination. For the purposes of this Agreement, "Good
Reason" means and shall exist if:

                  (i) The Company relocates its principal employee offices
outside the area within a radius of fifty (50) miles from Newport Beach,
California, without the express consent of Executive, and Executive gives the
Company written notice of Executive's objection to such relocation within five
(5) days of being informed of such contemplated relocation; or

                  (ii) Without Executive's express consent, the Company
substantially reduces Executive's duties and responsibilities such that it
results in a material adverse reduction in Executive's position, authority or
responsibilities, and the Company fails to cure such reduction in duties and
responsibilities within twenty (20) days after Executive gives to the Company
written notice specifying the particular acts objected to and the specific cure
requested; or

                  (iii) The Company's material breach of any provision or
covenant of this Agreement, provided that the Company first shall have received
prior written notice from Executive stating with specificity the nature of such
material breach and affording the Company a reasonable opportunity, as soon as
practicable, but in no event more than thirty (30) days, to initiate appropriate
action to cure the material breach complained of.

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         (d) MERGER, CONSOLIDATION, REORGANIZATION OR SALE OF ASSETS. This
Agreement shall not be terminated either (i) upon or by any merger,
consolidation, reorganization or similar transaction in which the Company is not
the surviving or resulting corporation or entity or (ii) upon or by any transfer
of all or substantially all of the assets of the Company. Upon any such merger,
consolidation, reorganization or similar transaction, or upon any such transfer
of assets, the terms and provisions of this Agreement shall be binding on and
shall inure to the benefit of the surviving or resulting corporation or other
entity or the corporation or other entity to which such assets are so
transferred.

         (e) RESIGNATION AS OFFICER AND DIRECTOR. In the event of any
termination under this Section 11 of Executive's employment under this
Agreement, Executive shall be deemed to have resigned voluntarily as an officer
and director of the Company or any of its Subsidiaries or Affiliates if
Executive was serving in such capacity at the time of termination.

         (f) TERMINATION CERTIFICATION. On the date of termination of
Executive's employment with the Company under this Agreement, Executive shall
sign and deliver to the Company the "Termination Certification" attached hereto
as Exhibit A.

         (g) SURVIVAL. The termination of Executive's employment under this
Agreement shall not affect the enforceability of Sections 12, 13 and 14 of this
Agreement.

         12. COMPENSATION UPON TERMINATION.

         (a) UPON TERMINATION FOR CAUSE, DISABILITY OR DEATH. If the Company
terminates Executive's employment for death, Disability or For Cause in
accordance with subsections 11(a), 11(a)(i) and 11(a)(ii) of this Agreement,
then Executive shall receive payment of Base Salary earned, payment of any
unused accrued vacation through and including the date of termination, plus
reimbursements, under Section 10 of this Agreement, for business expenses
incurred by Executive up to the date of termination (the "Termination Payment").

         The Termination Payment shall constitute Executive's sole right and
exclusive remedy in the event of such termination of Executive's employment, and
upon payment by the Company of the Termination Payment, all other rights or
remedies otherwise available shall cease immediately, and the Company shall have
no further obligations to Executive under this Agreement, except that Executive
shall have the right to exercise all benefits that have vested as of the date of
termination to which Executive is entitled under any compensation or employee
benefit plan of the Company in accordance with the terms and provisions of such
compensation or employee benefit plan, all other documents and agreements that
give rise to or otherwise govern such vested benefits and all applicable laws
and regulations.

         Upon termination of Executive by the Company for death or Disability,
all Stock Options, to the extent not theretofore exercised, shall terminate upon
expiration of twelve (12) months from the date of termination. Upon termination
of Executive by Company for For Cause, all Stock Options, to the extent no
theretofore exercised, shall terminate upon expiration of three (3) months from
the date of termination.

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         (b) UPON VOLUNTARY TERMINATION BY EXECUTIVE. If Executive voluntarily
terminates Executive's employment in accordance with subsection 11(c) of this
Agreement for Good Reason, then, in exchange for execution of a general release
and California Civil Code section 1542 waiver (a copy of which is attached
hereto as Exhibit B), the Company shall pay Executive an amount (the "Severance
Payment") equal to twelve (12) months' Base Salary in effect on the date of
termination, payment of base salary earned and payment of any unused accrued
vacation through and including the date of termination plus reimbursement, under
Section 10 of this Agreement, for business expenses incurred by Executive up to
the date of termination. The Severance Payment shall be paid upon the Company's
receipt of the executed general release and California Civil Code section 1542
waiver.

         If Executive voluntarily terminates Executive's employment in
accordance with subsection 11(c) of this Agreement without Good Reason, then
Executive shall receive the Termination Payment. Upon any termination by
Executive, all Stock Options, to the extent not theretofore exercised, shall
terminate upon expiration of three (3) months from the date of termination.

         In either event, the Severance Payment or the Termination Payment, as
the case may be, shall constitute Executive's sole right and exclusive remedy in
the event of such termination of Executive's employment, and upon payment by the
Company of either the Severance Payment or the Termination Payment, as the case
may be, all other rights or remedies otherwise available shall cease
immediately, and the Company shall have no further obligations to Executive
under this Agreement, except that Executive shall have the right to exercise all
benefits that have vested as of the date of termination to which Executive is
entitled under any compensation or employee benefit plan of the Company in
accordance with the terms and provisions of such compensation or employee
benefit plan, all other documents and agreements that give rise to or otherwise
govern such vested benefits and all applicable laws and regulations.

         (c) UPON TERMINATION WITHOUT CAUSE BY THE COMPANY. If Executive's
employment is terminated pursuant to subsection 11(b) of this Agreement, then,
in exchange for execution of a general release and California Civil Code section
1542 waiver (a copy of which is attached hereto as Exhibit B), the Company shall
pay Executive the Severance Payment. The Severance Payment shall be paid upon
the Company's receipt of the executed general release and California Civil Code
section 1542 waiver.

         The Severance Payment shall constitute Executive's sole right and
exclusive remedy in the event of such termination of Executive's employment, and
upon payment by the Company of the Severance Payment, all other rights or
remedies otherwise available shall cease immediately, and the Company shall have
no further obligations to Executive under this Agreement, except that Executive
shall have the right to exercise all benefits that have vested as of the date of
termination to which Executive is entitled under any compensation or employee
benefit plan of the Company in accordance with the terms and provisions of such
compensation or employee benefit plan, all other documents and agreements that
give rise to or otherwise govern such vested benefits and all applicable laws
and regulations.

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         Upon termination of Executive by for any reason under this subsection,
all Stock Options, to the extent no theretofore exercised, shall terminate upon
expiration of three (3) months from the date of termination.

         (d) EXCLUSIVITY OF PAYMENTS. Upon termination of Executive's employment
under this Agreement, Executive shall not be entitled to any severance payment
or severance benefit from the Company other than the payments and benefits
provided in this Section 12.

         (e) WITHHOLDING OF TAXES; TAX REPORTING. The Company may withhold from
any amount payable under this Agreement all such federal, state, city and other
taxes and may file with appropriate governmental authorities all such
information, returns or other reports with respect to the tax consequences of
any amount payable under this Agreement as may in the Company's reasonable
judgment be required.

         (f) SECTION 280G. Anything in this Agreement to the contrary
notwithstanding, Executive's payments and benefits under this Agreement and all
other arrangements or programs shall not, in the aggregate, exceed the maximum
amount that may be paid to Executive without triggering golden parachute
penalties under Section 280G and related provisions of the Internal Revenue Code
of 1986, as amended, as determined in good faith by the Company's independent
auditors. If Executive's benefits must be cut back to avoid triggering such
penalties, then Executive's benefits shall be cut back in the priority order
that Executive designates or, if Executive fails to designate promptly such an
order, in the priority order that the Company designates. Executive and the
Company shall cooperate reasonably with each other in connection with any
administrative or judicial proceeding about the existence or amount of golden
parachute penalties on payments or benefits that Executive receives from the
Company. This Section 12(h) shall not be applicable if the Executive's payments
and benefits triggering the golden parachute penalties of Code Section 280G were
approved by the shareholders of the Company as required by Code Section
280G(b)(5)(b), and the Company shall undertake its reasonable best efforts to
obtain such shareholder approval.

         13. COVENANTS NOT TO COMPETE.

         (a) During the Term hereof Executive shall not, directly or indirectly,
as an employee, agent, advisor, independent contractor, officer, director,
manager, member, partner, owner, consultant or otherwise, (i) compete with the
Company or with any of its Subsidiaries or Affiliates, (ii) solicit for
employment or any other capacity any employee or executive of the Company or of
any of its Subsidiaries or Affiliates, (iii) induce or attempt to induce any
employee of the Company or of any of its Subsidiaries or Affiliates to leave the
employ of the Company or of any of its Subsidiaries or Affiliates, (iv) solicit
any actual or prospective customer of the Company or of any of its Subsidiaries
or Affiliates for any business that competes directly or indirectly with the
Company or any of its Subsidiaries or Affiliates, (v) divulge any of the
Company's Proprietary Information (as that term is defined in the Proprietary
Information and Invention Assignment Agreement) in an attempt to solicit any
employees, contractors, licensees or customers of the Company or of any of its
Subsidiaries or Affiliates or (vi) interfere with, disrupt or attempt to disrupt
the relationship, contractual or otherwise, between any customer, client,
licensor, licensee, supplier, consultant or employee of the Company or of any of
its Subsidiaries or Affiliates. An

                                      -10-

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activity competitive with an activity engaged in by the Company or by any of its
Subsidiaries or Affiliates shall include, without limitation, becoming an
employee, agent, advisor, independent contractor, officer, director, manager,
member, partner, owner, consultant or other assistant or representative of, or
being an investor to any extent or in any manner in, any entity or person
engaged in any business that is competitive with the business of the Company or
the business of any of its Subsidiaries or Affiliates, or is the same as or
similar to the business of the Company or that of its Subsidiaries or
Affiliates, (in each case) as conducted or proposed to be conducted.
Notwithstanding any of the foregoing, for the purposes of this Agreement, the
following activities shall not be deemed to be competition with the Company or
with any of its Subsidiaries or Affiliates: (a) the beneficial ownership by
Executive of less than a one percent (1.0%) interest in any publicly-traded; and
(b) engaging in business related activity of a personal nature in managing the
tangible and financial assets of the Executive, including the buying and selling
of such assets, it being understood that any activity wholesale in nature or the
buying and selling of such assets through dealers or brokers or auctioneers is
deemed not to be competitive with the activities of the Company or with any of
its Subsidiaries or Affiliates.

         (b) ENFORCEABILITY. The covenants set forth in subsections 13(a) and
(b) of this Agreement shall be construed as an agreement independent of any
other provision of this Agreement, and the existence of any claim or cause of
action of Executive against the Company or against any of its Subsidiaries or
Affiliates, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of any of such covenants.
Executive expressly waives any right to assert inadequacy of consideration as a
defense to enforcement of any of the provisions of this Section 13. Executive
and the Company hereby acknowledge that it is the desire and intent of Executive
and the Company, and Executive and the Company hereby agree, that the terms and
provisions of this Section 13 shall be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought.

         14. PROPRIETARY INFORMATION AND INVENTION ASSIGNMENT AGREEMENT. As a
material inducement to the Company to execute and deliver to Executive this
Agreement, and as a condition to the enforceability of this Agreement against
the Company, concurrently with Executive's execution and delivery to the Company
of this Agreement, Executive shall execute and deliver to the Company a
Proprietary Information and Invention Assignment Agreement substantially in the
form attached hereto as Exhibit C (the "Proprietary Information and Invention
Assignment Agreement").

         15. UNIQUE NATURE OF SERVICES; RIGHT TO INJUNCTION. Executive
acknowledges and agrees that Executive's services under this Agreement are
unique and of extraordinary character and that it would be extremely difficult
or impossible for the Company to replace such services or determine the damages
that would result from the loss of such services. Executive therefore agrees
that the Company's remedies at law are inadequate in the event of any breach of
this Agreement by Executive, and Executive consents to the issuance of a
temporary restraining order, preliminary and permanent injunction and other
appropriate relief to restrain any actual or threatened violation of this
Agreement, without limiting any of the other remedies that the Company may have
at law or in equity. If Executive violates or threatens to violate any of the
provisions of this Agreement, then, in addition to all other rights and remedies
that the Company may have under the terms of this Agreement and all applicable
law, the Company shall have the right to seek and obtain equitable

                                      -11-

<PAGE>

relief in the form of a temporary restraining order and permanent injunction
against Executive and any corporation, business, firm, partnership,
limited-liability company, association, consortium, group, other form of entity
or individual participating in such violation or threatened violation, without
the proof of actual damages.

         16. MEDIATION, ARBITRATION AND CONSENT TO JURISDICTION.

         (a) MEDIATION AND ARBITRATION.

                  (i) If a dispute, claim or controversy arises between the
Company and Executive with respect to any provision of this Agreement, or the
interpretation or performance of this Agreement, and such dispute, claim or
controversy is declared by written notice from one party hereto to the other,
then the Company and Executive shall negotiate in good faith toward resolution
of such dispute, claim or controversy. If such dispute, claim or controversy
cannot be resolved within a period of sixty (60) days (or such shorter period as
may be specified herein) after such notice is given, then the Company and
Executive first shall endeavor to settle such dispute, claim or controversy in
an amicable manner by mediation administered by JAMS under JAMS' employment
dispute resolution mediation rules, before resorting to arbitration. Thereafter,
any remaining unresolved dispute, claim or controversy arising out of or
relating to this Agreement, or the breach thereof, shall be settled by binding
arbitration in Orange County, California, under the laws of the State of
California, in accordance with the binding arbitration rules of JAMS unless and
except if in conflict with this Agreement. The arbitration tribunal shall
consist of one (1) arbitrator. The determination of the arbitrator shall be
conclusive and binding on the Company and Executive. The identity of the
arbitrator shall be mutually acceptable to both the Company and Executive, and
he or she shall preside and decide the dispute, claim or controversy unless the
Company and Executive agree in writing to the contrary. If the Company and
Executive fail to agree on the identity of the arbitrator, then the Company and
Executive shall accept an arbitrator appointed by JAMS.

                  (ii) The award of the arbitrator may be, alternatively or
cumulatively, for monetary damages, an order requiring the performance of
non-monetary obligations (including specific performance) or any other
appropriate order or remedy. The arbitrator may issue interim awards and order
provisions or measures that should be taken in order to preserve the respective
rights of the Company and Executive.

                  (iii) Any award rendered by the arbitrator shall be in
writing, setting forth the reasons for the award, and shall be the final
disposition on the merits. Judgment upon the award may be rendered in any court
having jurisdiction, or application may be made to any such court having
jurisdiction, or application may be made to any such court for a judicial
acceptance of the award and an order of enforcement, as the case may be. The
Company and Executive waive any right that they may enjoy under any federal or
state law to apply to any federal or state court for relief from the provisions
of this paragraph or from any decision of the arbitrator made before the award.
THE COMPANY AND EXECUTIVE ACKNOWLEDGE AND AGREE THAT EACH OF THEM IS WAIVING THE
RIGHT TO A JURY TRIAL.

                  (iv) The party that prevails in the arbitration shall be
entitled to recover from the party that loses in the arbitration all expenses,
including, without limitation, reasonable

                                      -12-

<PAGE>

attorneys' fees and expenses, incurred in ascertaining such party's rights and
in preparing to enforce and/or defend and in enforcing and/or defending such
party's rights under this Agreement.

                  (v) The procedure set forth in this subsection 16(a) shall be
the exclusive remedy available to the Company and Executive to resolve any
dispute, claim or controversy arising under this Agreement or out of Executive's
employment with the Company.

         (b) CONSENT TO JURISDICTION. Notwithstanding anything to the contrary
contained in subsection 16(a) of this Agreement, each of the Company and
Executive hereby irrevocably submits to the exclusive jurisdiction of the
Superior Court of the State of California, Orange County, or to the exclusive
jurisdiction of the United States District Court, Central District of California
(Southern Division), only for the purposes of either (i) obtaining relief not
within the jurisdiction or powers of the arbitrator, in connection with any
suit, action or other proceeding brought by any party hereto or any of its
respective heirs, successors or assigns, as applicable, arising out of or
related to Sections 13, 14 and 15 of this Agreement or (ii) the enforcement of
the arbitrator's determination as provided in subsection 16(a) of this
Agreement; and each of the Company and Executive agrees not to assert by way of
motion, as a defense or otherwise, in any such suit, action or proceeding, any
claim that such party hereto is not subject to the jurisdiction of the
above-named courts, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is improper
or that this Agreement may not be enforced in or by such courts. Executive
agrees that all actions and proceedings permitted to be instituted under this
Agreement by Executive or Executive's successors or assigns in a forum other
than arbitration arising out of or related to this Agreement or the transactions
contemplated by this Agreement shall be commenced only in the courts having a
situs in Orange County, California.

         17. REPRESENTATIONS, WARRANTIES AND COVENANTS OF EXECUTIVE. In order to
induce the Company to enter into and perform this Agreement, Executive
represents and warrants that Executive is not a party to any contract, agreement
or understanding that prevents or prohibits Executive from entering into this
Agreement or fully performing all of Executive's obligations under this
Agreement and that Executive's performance of all of the terms of this Agreement
and Executive's employment by the Company does not and shall not breach any
agreement to keep in confidence proprietary information acquired by Executive in
confidence or in trust before Executive's employment by the Company.

         18. VOLUNTARY EXECUTION AND DELIVERY; LEGAL COUNSEL. Executive
acknowledges that Executive has read carefully this Agreement and understands
its terms and that Executive voluntarily is executing and delivering this
Agreement. Executive acknowledges that the Company's legal counsel is not legal
counsel to Executive and has not advised Executive in any way in connection with
or regarding this Agreement. Executive represents, warrants and acknowledges to
the Company that Executive has been given and had the opportunity to be
represented by independent legal counsel in connection with this Agreement and
has consulted with such legal counsel or has waived Executive's right to do so.

         19. MISCELLANEOUS.

         (a) GOVERNING LAW. The validity, construction, interpretation and
enforceability of this Agreement shall be determined and governed by the laws of
the State of California.

                                      -13-

<PAGE>

Notwithstanding the foregoing, if any law or set of laws of the State of
California requires or otherwise dictates that the laws of another state or
jurisdiction be applied in any proceeding involving this Agreement, then such
law or laws of the State of California shall be superseded by this subsection,
and the remaining laws of the State of California nonetheless shall be applied
in such proceeding.

         (b) SEVERABILITY. If any court of competent jurisdiction determines
that any provision of this Agreement is, but for the provisions of this
subsection, illegal or void as against public policy, for any reason, then such
provision shall automatically be amended or modified to the extent (but only to
the extent) necessary to make it sufficiently narrow in scope, time and
geographic area that such court shall determine it not to be illegal or void as
against public policy. If any such provision cannot be amended or modified to
the extent provided in the immediately-preceding sentence hereof, then such
provision shall be severed from this Agreement. In either event, all other
remaining terms and provisions of this Agreement and of each other agreement
entered into pursuant to this Agreement shall remain in full force and effect
and shall remain binding on the Company and Executive as if such severed
provision had not been contained herein. Any such amendment, modification or
severance shall apply only with respect to the operation of this Agreement in
the particular jurisdiction in which such determination of illegality or
unenforceability is made.

         (c) NOTICES. Any notice or communication required or permitted under
this Agreement shall be in writing and shall be deemed to have been received by
the party to whom such notice or communication is addressed (i) upon delivery,
if delivered personally, or (ii) upon receipt by the TRANSMITTING party, if
transmitting such notice or communication via telex or facsimile machine, of an
acknowledgment of receipt of such notice or communication transmitted by the
receiving party to the transmitting party via telex or facsimile machine, or
(iii) twenty four (24) hours after deposited, prepaid, in a Federal Express or
similar depository for expedited overnight delivery or (iv) ten (10) business
days after deposited in the United States mail, registered or certified, postage
prepaid, return receipt requested, addressed as follows:

          If to the Company:         Tangible Asset Galleries, Inc.
                                     Attn: Secretary
                                     3444 Via Lido
                                     Newport Beach, CA 92663
                                     FAX: 949/566-9143

          If to Executive:           Silvano DiGenova
                                     32001 South Coast Highway
                                     Laguna Beach, CA 92651

or to such other persons or addresses as either of the Company or Executive from
time to time may provide in writing to each other.

         (d) WAIVER. No failure on the part of either party hereto to exercise,
and no delay in exercising, any right, power or remedy under this Agreement
shall operate as a waiver thereof or as a waiver of any other right, power or
remedy under this Agreement or the performance of any

                                      -14-

<PAGE>

obligation under this Agreement of either party hereto; and no single or partial
exercise by either party hereto of any right, power or remedy under this
Agreement shall preclude any other or further exercise thereof or the exercise
of any other right, power or remedy.

         (e) AMENDMENT AND MODIFICATION. Subject to applicable law and upon the
approval of the Board of Directors, this Agreement may be amended, modified and
supplemented with respect to any of the terms of this Agreement by written
agreement by and between the Company and Executive. The provisions of this
Agreement shall not be extended, varied, changed, modified, amended or
supplemented other than by an agreement in writing approved by the Board of
Directors and executed by both a duly authorized officer of the Company and
Executive.

         (f) ASSIGNABILITY AND BINDING EFFECT. This Agreement shall inure to the
benefit of and be binding on the heirs, executors, administrators, successors
and legal representatives of Executive and shall inure to the benefit of and be
binding on the Company and its successors and assigns, but the obligations of
Executive under this Agreement may not be delegated by any purported assignment
of this Agreement by Executive.

         (g) CAPTIONS AND HEADINGS. The captions and headings used in this
Agreement are for convenience of reference only and do not constitute a part of
this Agreement and shall not be deemed to limit, characterize or in any way
affect any term or provision of this Agreement, and all terms and provisions of
this Agreement shall be enforced and construed as if no captions or headings
appeared in this Agreement.

         (h) INTERPRETATION AND CONSTRUCTION. If any provision of this Agreement
requires interpretation by an arbitrator or court, then such interpretation or
construction shall not apply a presumption that the terms hereof shall be more
strictly construed against the Company by reason of the rule of construction
that a document is to be construed more strictly against the person or agent of
such person who prepared the same, it being hereby acknowledged and agreed by
both the Company and Executive that both of them participated in the negotiation
and preparation of this Agreement.

         (i) FURTHER ASSURANCES. Each of the Company and Executive shall execute
and deliver all such further instruments and take such other and further actions
as reasonably may be necessary or appropriate to carry out the provisions of
this Agreement.

         (j) LIMITATIONS ON ACTIONS. Executive agrees not to commence any action
arising out of or in any way related to this Agreement or to Executive's
employment with the Company more than six (6) months after the termination of
Executive's employment. Executive agrees that six (6) months is a reasonable
amount of time in which to commence any such action and expressly waives any
statute of limitations to the contrary.

         (k) ENTIRE AGREEMENT AND BINDING EFFECT. This Agreement and the
Proprietary Information and Invention Assignment Agreement (collectively, the
"Agreements") constitute the entire agreement of the parties hereto and
supersede all prior understandings, agreements or representations by or between
the parties hereto, whether oral or in writing, that may have been related to
the subject matter of the Agreements in any manner. No restrictions, promises,
warranties,

                                      -15-

<PAGE>

covenants or undertakings exist relating to the subject matter of the Agreements
other than those expressly provided for in the Agreements.

         (1) COUNTERPART EXECUTION. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original of this Agreement,
but all of which together shall constitute one instrument.

         IN WITNESS WHEREOF, the Company and Executive have executed this
Agreement to be effective as of June 1, 2001.

The "Company":                               "Executive":

TANGIBLE ASSET GALLERIES, INC.
a Nevada corporation                         /s/ Silvano DiGenova
                                             -----------------------------
                                             Silvano DiGenova, an individual

By /s/ signature
   ----------------------
Name: President
Title: illegible

                                             DiGenova Employment
                                             Agreement

                                      -16-

<PAGE>

                                   EXHIBIT A

                           TERMINATION CERTIFICATION

         I hereby certify that I do not have in my possession, and I have not
failed to return to the Company (as defined below), devices, records, data,
notes, reports, proposals, lists, customer lists, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property or reproductions of any of the aforementioned items
belonging to TANGIBLE ASSET GALLERIES, INC., a Nevada corporation ("Tangible"),
its Subsidiaries, its Affiliates, its successors or its assigns (together,
collectively, the "Company").

         I hereby further certify that I have complied in all material respects
with all of the terms of that certain Employment Agreement, effective as of
April 30, 2001, by and between Tangible and me (the "Employment Agreement").

         I further certify that I have complied in all material respects with
all of the terms of that certain Proprietary Information and Invention
Assignment Agreement, effective as of April 30, 2001, by and between Tangible
and me, including the reporting of inventions and original works of authorship
conceived or made by me (solely or jointly with others).

         I further certify that I shall comply in all material respects with all
provisions of the Employment Agreement and the Proprietary Information and
Invention Assignment Agreement that survive the termination of my employment
with the Company, including, without limitation, Sections 12, 13 and 14 of the
Employment Agreement.

Dated:___________________                    ___________________________________
                                             Name

<PAGE>

                                   EXHIBIT B

                               WAIVER AND RELEASE

         For full and valuable consideration, I, Silvano DiGenova, hereby agree
to the following Waiver and Release provision relating to my employment and its
termination with TANGIBLE ASSET GALLERIES, INC. (the "Company"):

         I hereby release and discharge the Company and its divisions,
affiliates, parents, subsidiaries, predecessor and successor corporations, and
the past and present directors, officers, management committees, shareholders,
agents, servants, employees, representatives, administrators, partners, general
partners, managing partners, limited partners, benefit plan fiduciaries and
administrators, assigns, heirs, successors or predecessors in interest,
adjusters and attorneys, from all rights, claims, causes of action and damages,
both known and unknown, in law or in equity, concerning and/or arising out of my
employment with the Company before the date of this Waiver and Release that I
now have, or ever had, including, without limitation, all rights, claims, causes
of action or damages arising under Title VII of the Civil Rights Act of 1964,
the Age Discrimination in Employment Act of 1967, the Older Workers' Benefit
Protection Act, Employee Retirement Income Security Act, the Americans with
Disabilities Act, the California Fair Employment and Housing Act and the
California Labor Code.

         I specifically waive and relinquish all rights and benefits afforded by
California Civil Code section 1542. I understand and acknowledge the
significance and consequences of this specific waiver of section 1542.
California Civil Code section 1542 states as follows:

         A general release does not extend to claims which the creditor does not
         know or suspect to exist in his favor at the time of executing the
         release, which if known by him must have materially affected his
         settlement with the debtor.

         Dated: ____________________        ________________________________
                                            Name

<PAGE>

                                   EXHIBIT C

                 FORM OF PROPRIETARY INFORMATION AND INVENTION
                              ASSIGNMENT AGREEMENT<PAGE>

                             THE UNISYS CORPORATION
                             2002 STOCK OPTION PLAN

SECTION 1. PURPOSE; DEFINITIONS.

         The purpose of the Plan is to support the Company's ongoing efforts to
attract and retain highly competent employees and enable the Company to provide
incentives directly linked to the profitability of the Company's businesses and
to increases in shareholder value.

         For purposes of the Plan, the following terms are defined as set forth
below:

         a.    "Awards" mean grants under the Plan of Non-qualified Stock
Options.

         b.    "Beneficiary" means the individual, trust or estate who or which
by designation of the participant or operation of law succeeds to the rights and
obligations of the participant under the Plan and award agreement upon the
participant's death.

         c.    "Board" means the Board of Directors of the Company.

         d.    "Code" means the Internal Revenue Code of 1986, as amended from
time to time, and any successor thereto.

         e.    "Commission" means the Securities and Exchange Commission or any
successor agency.

         f.    "Committee" means the Corporate Governance and Compensation
Committee of the Board or a subcommittee thereof, any successor thereto or such
other committee or subcommittee as may be designated by the Board to administer
the Plan.

         g.    "Common Stock" or "Stock" means the common stock of the Company,
par value $0.01 per share.

         h.    "Company" means Unisys Corporation or any successor thereto.

         i.    "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor thereto.

         j.    "Fair Market Value" means, on any date, the average of the high
and the low quoted sales prices of a share of Stock, sold regular way, through
the official close of the New York Stock Exchange at 4:00 p.m. US Eastern Time
on such date, or if there were no sales on such date, on the last date preceding
such date on which a sale was reported.

         k.    "Nonqualified Stock Option" means a Stock Option that is not
qualified under Section 422 of the Code.

         l.    "Normal Retirement Date" means the date on which the participant
is eligible to retire with unreduced benefits under a defined benefit pension
plan or

<PAGE>

arrangement of the Company or one of its Subsidiaries or, in the event that the
participant is not a member of such a plan or arrangement, the date on which the
participant attains age 65.

         m.    "Plan" means The Unisys Corporation 2002 Stock Option Plan, as

set forth herein and as may be amended from time to time.

         n.    "Stock Option" means an option granted pursuant to Section 5(a).

         o.    "Subsidiary" shall have the meaning set forth in Section 425(f)
of the Code.

         p.    "Termination of Employment" means the voluntary or involuntary
termination of a participant's employment with the Company or a Subsidiary for
any reason, including death, disability, retirement or as a result of the
divestiture of the participant's employer or any similar transaction in which
the participant's employer ceases to be the Company or one of its Subsidiaries.
The Committee, in its sole discretion, shall determine whether a Termination of
Employment is a result of disability, and shall determine whether military or
other government or eleemosynary service constitutes a Termination of
Employment.

In addition, the terms "Business Combination," "Change in Control," "Change in
Control Price," "Incumbent Board," "Outstanding Stock," "Outstanding Voting
Securities" and "Person" have the meanings set forth in Section 6.

SECTION 2. ADMINISTRATION.

         The Plan will be administered by the Committee, which will have the
power to interpret the Plan and to adopt such rules and guidelines for carrying
out the Plan as it may deem appropriate. The Committee will have the authority
to adopt such modifications, procedures and subplans as may be necessary or
desirable to comply with the laws, regulations, compensation practices and tax
and accounting principles of the countries in which the Company, a subsidiary or
an affiliate may operate to assure the viability of the benefits of Awards made
to individuals employed in such countries and to meet the objectives of the
Plan.

         Subject to the terms of the Plan, the Committee will have the authority
to determine those individuals eligible to receive Awards and the amount, type
and terms of each Award.

         The Committee may delegate its authority or power under the Plan to one
or more officers of the Company, subject to guidelines prescribed by the
Committee, with respect to participants who are not subject to Section 16 of the
Exchange Act.

         Any determination made by the Committee or pursuant to delegated
authority in accordance with the provisions of the Plan with respect to any
Award will be made in the sole discretion of the Committee or such delegate, and
all decisions made by the Committee or any appropriately designated officer
pursuant to the provisions of the Plan will be final

                                     -2-

<PAGE>

and binding on all persons, including the Company and Plan participants, but
subject to ratification by the Board if the Board so provides.

SECTION 3. ELIGIBILITY.

         All employees of the Company and its subsidiaries or affiliates, except
for elected officers of the Company, are eligible to be granted Awards under the
Plan.

SECTION 4. STOCK SUBJECT TO PLAN.

         The number of shares of Stock reserved and available for distribution
pursuant to the Plan will be 15,000,000 shares. If any Award is exercised,
cashed out or terminates or expires without a payment being made to the
participant in the form of Stock, the shares subject to such Award, if any, will
again be available for distribution in connection with Awards under the Plan.
Any shares of Stock that are used by a participant as full or partial payment of
withholding or other taxes or as payment for the exercise or conversion price of
an Award will be available for distribution in connection with Awards under the
Plan.

         In the event of any merger, reorganization, consolidation,
recapitalization, share exchange, stock dividend, stock split, reverse stock
split, split-up, spin-off, issuance of rights or warrants or other change in
corporate structure affecting the Stock after adoption of the Plan by the Board,
the Board is authorized to make substitutions or adjustments in the aggregate
number and kind of shares reserved for issuance under the Plan and in the
number, kind and price of shares subject to outstanding Awards, provided,
however, that any such substitutions or adjustments will be, to the extent
deemed appropriate by the Board, consistent with the treatment of shares of
Stock not subject to the Plan, and that the number of shares subject to any
Award will always be a whole number.

SECTION 5. AWARDS.

         (a)   Stock Option Awards. A Stock Option represents the right to
purchase a share of Stock at a predetermined exercise price. Stock Options
granted under this Plan will be in the form of Nonqualified Stock Options only.
The terms and conditions of each Stock Option Award, including the Stock Option
term, exercise price, applicable vesting periods and any other
restrictions/conditions on exercise, will be determined in the sole discretion
of the Committee and will be set forth in an Award agreement.

         (b)   Exercise Price. The exercise price of a Stock Option may not be
less than 100% of the Fair Market Value on the date of grant. Notwithstanding
the foregoing, in connection with any reorganization, merger, consolidation or
similar transaction in which the Company or any affiliate or subsidiary of the
Company is a surviving corporation, the Committee may grant Stock Options in
substitution for similar awards granted under a plan of another party to the
transaction, and in such a case the exercise price or grant price of the
substituted Stock Options granted by the Company may equal or exceed 100% of the
Fair Market Value on the date of grant reduced by any unrealized gain existing
as of the date of the transaction in the option being replaced.

                                     -3-

<PAGE>

         (c)   Duration of Stock Options.  Stock Options will terminate after
the first to occur of the following:

         (1)   Expiration of the Stock Option as provided in the applicable
               Award Agreement; or

         (2)   Termination of the Stock Option Award, as provided in Section
               5(e), following the participant's Termination of Employment.

         (d)   Acceleration/Extension of Exercise Time. The Committee, in its
sole discretion, shall have the right (but shall not in any case be obligated)
to permit purchase of shares under any Stock Option prior to the time such
Option would otherwise become exercisable under the terms of the applicable
Award agreement. In addition, the Committee, in its sole discretion, shall have
the right (but shall not in any case be obligated) to permit any Stock Option
granted under this Plan to be exercised after its termination date described in
Section 5(e), but in no event later than the last day of the term of the Stock
Option as set forth in the applicable Award agreement.

         (e)   Exercise of Stock Options upon Termination of Employment. Except
as otherwise provided in this Section 5(e) or in Section 5(d), the right of the
participant to exercise Stock Options shall terminate upon the participant's
Termination of Employment, regardless of whether or not the Stock Options were
vested in whole or in part on the date of Termination of Employment.

         (1)   Disability or Normal Retirement. Upon a participant's Termination
of Employment by reason of disability or retirement on a Normal Retirement Date,
a participant may, within five years after the Termination of Employment,
exercise all or a part of his/her Stock Options that were exercisable upon such
Termination of Employment (or which became exercisable at a later date pursuant
to Section 5(e)(3) below). In no event, however, may any Stock Option be
exercised later than the last day of the term of the Stock Option as set forth
in the applicable Award agreement.

         (2)   Death. In the event of the death of a participant while employed
by the Company or a Subsidiary, or within the additional period of time from the
date of Termination of Employment and prior to the termination of the Stock
Option as permitted under Section 5(e)(1) or Section 5(e)(3)(B), to the extent
that the right to exercise the Stock Option had vested as of the date of the
participant's death, the right of the participant's Beneficiary to exercise the
vested portion of the Stock Option shall expire on the earliest of (A) five
years from the date of the participant's death, (B) five years from the date of
the participant's Termination of Employment or (C) the last day of the term of
the Stock Option as set forth in the applicable Award agreement.

         (3)   Termination of Employment at Age 55 with Five Years of Service.
Notwithstanding anything in this Section 5 to the contrary, if Termination of
Employment occurs after the participant has attained age 55 and completed five
years of service with the Company and/or its Subsidiaries, (A) the participant
shall continue to vest in each of his/her Stock Options in accordance with the
vesting schedules set forth in the applicable Award agreements, and (B) the
participant may exercise his/her Stock Options, to the

                                     -4-

<PAGE>

extent that the Stock Options have vested as of the Termination of Employment or
thereafter in accordance with Section 5(e)(3)(A), for a period of five years
from the date of the participant's Termination of Employment. In no event,
however, may any Stock Option be exercised later than the last day of the term
of the Stock Option as set forth in the applicable Award agreement.

         (f)   Exercise Procedures. Subject to the applicable Award agreement,
Stock Options may be exercised, in whole or in part, by giving written notice of
exercise to the Company or its designee specifying the number of shares to be
purchased. This notice must be accompanied by payment in full of the exercise
price by certified or bank check or such other instrument as the Company or its
designee may accept (including a copy of instructions to a broker or bank
acceptable to the Company to deliver promptly to the Company an amount of sale
or loan proceeds sufficient to pay the purchase price). If authorized by the
Committee, payment in full or in part may also be made (1) in the form of Stock
already owned by the optionee valued at the Fair Market Value on the date the
Stock Option is exercised, under such terms and conditions as are deemed
appropriate by the Committee, or (2) through a cashless exercise program
established or otherwise authorized by the Company.

SECTION. 6. CHANGE IN CONTROL PROVISIONS.

         (a)   Impact of Event. Notwithstanding any other provision of the Plan
to the contrary, and except to the extent expressly provided otherwise in an
Award agreement, in the event of a Change in Control all Stock Options
outstanding as of the date the Change in Control occurs will become fully vested
and immediately exercisable. In addition, a participant who is an elected
officer of the Company will be permitted to surrender for cancellation within 60
days after the Change in Control any Stock Option or portion of a Stock Option
to the extent not exercised and to receive a cash payment in an amount equal to
the excess, if any, of (A) the Change in Control Price, over (B) the exercise
price of the Stock Option. The provisions of this Section 6(a) will not be
applicable to any Stock Options granted to a participant if the Change in
Control results from the participant's beneficial ownership (within the meaning
of Rule 13d(3) under the Exchange Act) of Stock or Voting Securities.

         (b)   Definition of Change in Control. A "Change in Control" means any
of the following events:

               (1)  The acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a "Person")) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (A) the then outstanding shares of Stock
(the "Outstanding Stock") or (B) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Voting Securities"), provided, however,
that the following acquisitions will not constitute a Change in Control: (1) any
acquisition directly from the Company, (2) any acquisition by the Company, (3)
any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the

                                      -5-

<PAGE>

Company or any corporation controlled by the Company or (4) any acquisition by
any corporation pursuant to a transaction described in clauses (A), (B) and (C)
of paragraph (3) of this Section 6(b); or

               (2)  Individuals who, as of the effective date of the Plan,
constitute the Board (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Board, provided, however, that any individual's
becoming a director after the effective date of the Plan whose election, or
nomination for election by the stockholders of the Company, was approved by a
vote of at least a majority of the directors then comprising the Incumbent Board
will be considered as though the individual were a member of the Incumbent
Board, but excluding, for this purpose, any individual whose initial assumption
of office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

               (3)  Consummation of a reorganization, merger or consolidation or
sale or disposition of all or substantially all of the assets of the Company (a
"Business Combination"), unless, in each case following such Business
Combination, (A) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Stock and
Outstanding Voting Securities immediately before the Business Combination
beneficially own, directly or indirectly, more than 50% of, respectively, the
then outstanding shares of common stock and 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 corporation resulting from such Business
Combination (including, without limitation, a corporation that as a result of
the transaction owns the Company or all or substantially all of the assets of
the Company either directly or indirectly through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Stock and Outstanding Voting Securities,
as the case may be, (B) no Person (excluding any employee benefit plan (or
related trust) of the Company or the corporation resulting from the Business
Combination) beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from the Business Combination or the combined voting power of the then
outstanding voting securities of the corporation except to the extent that the
Person owned 20% or more of the Outstanding Stock or Outstanding Securities
before the Business Combination, and (C) at least a majority of the members of
the board of directors of the corporation resulting from the Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing for the Business
Combination; or

               (4)  Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

         (c)   Definition of Change in Control Price. "Change in Control Price"
means the greater of (1) the highest Fair Market Value of a share of Stock
during the 60-day period ending on the date of the Change in Control, and (2)
the highest price per share of Stock paid to holders of Stock in any transaction
(or series of transactions) constituting or resulting from the Change in
Control.

                                     -6-

<PAGE>

SECTION 7.  PLAN AMENDMENT AND TERMINATION.

         The Board may amend or terminate the Plan at any time. Except as set
forth in any Award agreement, no amendment or termination of the Plan may
materially and adversely affect any outstanding Award under the Plan without the
Award recipient's consent.

SECTION 8.  PAYMENTS AND PAYMENT DEFERRALS.

         Payment of Awards will be in the form of Stock. The Committee, either
at the time of grant or by subsequent amendment, may require or permit deferral
of the payment of Awards under such rules and procedures as it may establish. It
also may provide that deferred settlements include the payment or crediting of
interest or other earnings on the deferred amounts, or the payment or crediting
of dividend equivalents where the deferred amounts are denominated in Stock
equivalents.

SECTION 9.  TRANSFERABILITY.

         Except to the extent permitted by the Award agreement, either initially
or by subsequent amendment, Awards will not be transferable or assignable other
than by will or the laws of descent and distribution, and will be exercisable
during the lifetime of the recipient only by the recipient.

SECTION 10. AWARD AGREEMENTS.

         Each Award under the Plan will be evidenced by a written agreement
(which need not be signed by the recipient unless otherwise specified by the
Committee) that sets forth the terms, conditions and limitations for each Award.
Such terms may include, but are not limited to, the term of the Award, vesting
and forfeiture provisions, and the provisions applicable in the event the
recipient's employment terminates. The Committee may amend an Award agreement,
provided that no such amendment may materially and adversely affect an Award
without the Award recipient's consent.

SECTION 11. UNFUNDED STATUS OF PLAN.

         It is presently intended that the Plan constitute an "unfunded" plan
for incentive and deferred compensation. The Committee may authorize the
creation of trusts or other arrangements to meet the obligations created under
the Plan to deliver Stock or make payments; however, unless the Committee
otherwise determines, the structure of such trusts or other arrangements must be
consistent with the "unfunded" status of the Plan.

SECTION 12. GENERAL PROVISIONS.

         (a)   The Committee may require each person acquiring shares of Stock
pursuant to an Award to represent to and agree with the Company in writing that
such person is acquiring the shares without a view to the distribution thereof.
The certificates for such shares may include any legend that the Committee deems
appropriate to reflect any restrictions on transfer.

                                     -7-

<PAGE>

         All certificates for shares of Common Stock or other securities
delivered under the Plan will be subject to such stock transfer orders and other
restrictions as the Committee may deem advisable under the rules, regulations
and other requirements of the Commission, any stock exchange upon which the
Stock is then listed and any applicable Federal, state or foreign securities
law, and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such restrictions.

         (b)   Nothing contained in this Plan will prevent the Company, a
Subsidiary or an affiliate from adopting other or additional compensation
arrangements for its employees or directors.

         (c)   The adoption of the Plan will not confer upon any employee any
right to continued employment nor will it interfere in any way with the right of
the Company, a Subsidiary or an affiliate to terminate the employment of any
employee at any time.

         (d)   No later than the date as of which an amount first becomes
includible in the gross income of the participant for Federal income tax
purposes with respect to any Award under the Plan, the participant will pay to
the Company, or make arrangements satisfactory to the Company regarding the
payment of, any Federal, state, local or foreign taxes of any kind required by
law to be withheld with respect to such amount. Unless otherwise determined by
the Committee, withholding obligations arising from an Award may be settled with
Stock, including Stock that is part of, or is received upon exercise or
conversion of, the Award that gives rise to the withholding requirement. The
obligations of the Company under the Plan will be conditional on such payment or
arrangements, and the Company, its subsidiaries and its affiliates will, to the
extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to the participant. The Committee may establish such
procedures as it deems appropriate, including the making of irrevocable
elections, for the settling of withholding obligations with Stock.

         (e)   On receipt of written notice of exercise, the Committee may elect
to cash out all or a portion of the shares of Stock for which a Stock Option is
being exercised by paying the optionee an amount, in cash or Stock, equal to the
Spread Value of such shares on the date such notice of exercise is received.

         (f)   The Plan and all Awards made and actions taken thereunder will be
governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania.

         (g)   If any provision of the Plan is held invalid or unenforceable,
the invalidity or unenforceability will not affect the remaining parts of the
Plan, and the Plan will be enforced and construed as if such provision had not
been included.

         (h)   Any reference in the Plan to a provision of the Code, the
Exchange Act or other law may be interpreted by the Committee, in its
discretion, to encompass any successor provision of the law.

                                     -8-

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