Document:

<PAGE>

                                                                    EXHIBIT 10.1

                             APPLIED INNOVATION INC.

                              EMPLOYMENT AGREEMENT

      This Agreement is made as of this 11th day of February, 2005, by and
between WILLIAM H. LARGENT. and APPLIED INNOVATION INC., a Delaware corporation
with its principal office at 5800 Innovation Drive, Dublin, Ohio 43016, its
subsidiaries, successors and assigns (the "Company").

                                    RECITALS

      A. The Company is engaged in the business of developing, manufacturing,
and marketing data communications and data transmission equipment, software, and
services to telephone companies, interexchange telephone carriers, cable
television companies, and electric utilities, for alarm data communications,
network mediation and management, interoperability of networks, and network
switching and routing, and develops and uses valuable technical and nontechnical
trade secrets and other confidential information which it desires to protect.

      B. You have been employed as an executive officer of the Company since
January 24, 2005.

      C. The Company considers your continued services to be in the best
interest of the Company and desires, through this Agreement, to assure your
continued services on behalf of the Company on an objective and impartial basis
and without distraction or conflict of interest in the event of an attempt to
obtain control of the Company.

      D. You are willing to become employed by and to remain in the employ of
the Company on the terms set forth in this agreement.

                                    AGREEMENT

      NOW, THEREFORE, the parties agree as follows:

      1. CONSIDERATION. As consideration for your entering into this Agreement
and your willingness to remain bound by its terms, the Company shall employ you
and provide you with access to certain Confidential Information as defined in
this Agreement and other valuable consideration as provided for throughout this
Agreement, including in Sections 3 and 4 of this Agreement.

      2. EMPLOYMENT.

            (a) POSITION. You will be employed as President and Chief Executive
Officer, reporting to the Board of Directors of the Company. You shall perform
the duties, undertake the responsibilities and exercise the authority
customarily performed, undertaken and exercised by persons employed in similar
executive capacities. You will continue to serve on the Board of Directors
subject to periodic election and will be deemed to have submitted your
resignation from

                                      -1-
<PAGE>

the Board of Directors if your employment is terminated hereunder for any
reason, subject to acceptance by the Board of Directors.

            (b) RESTRICTED EMPLOYMENT. While employed by the Company, you shall
devote your best efforts to the business of the Company and shall not engage in
any outside employment or consulting work without first securing the approval of
the Company's Board of Directors. Furthermore, so long as you are employed under
this Agreement, you agree to devote reasonable time and efforts on behalf of the
Company and to competently, diligently, and effectively discharge your duties
hereunder. You shall not be prohibited from engaging in such personal,
charitable, or other nonemployment activities that do not interfere with your
full time employment hereunder and which do not violate the other provisions of
this Agreement. You further agree to comply fully with all policies and
practices of the Company as are from time to time in effect.

      3.    COMPENSATION.

            (a) Your compensation will be at an annual base rate of $175,000,
commencing as of January 24, 2005 ("Basic Salary"), payable in accordance with
the normal payroll practices of the Company. Your base salary may be increased
from time to time by action of the Board of Directors of the Company. You will
also be eligible for a cash bonus under a bonus plan which is determined
annually by the Board of Directors of the Company.

            (b) You will be entitled to receive stock options to purchase shares
of the common stock of the Company pursuant to the terms of plans adopted by the
Board of Directors of the Company from time to time. If a "Change in Control,"
as defined in Section 9(e)(v), shall occur, all outstanding stock options issued
to you shall become 100% vested and thereafter exercisable in accordance with
such governing stock option agreements and plans.

            (c) Subject to applicable Company policies, you will be reimbursed
for necessary and reasonable business expenses incurred in connection with the
performance of your duties hereunder or for promoting, pursuing or otherwise
furthering the business or interests of the Company.

      4.    FRINGE BENEFITS. You will be entitled to receive employee benefits
and participate in any employee benefit plans, in accordance with their terms as
from time to time amended, that the Company maintains during your employment and
which are made generally available to all other management employees in like
positions. This includes a 401(k) and profit sharing plan and paid medical
insurance. It is agreed that the Company will pay any necessary COBRA payments
on your behalf due to any break in medical coverage for any reason, including
pre-existing conditions.

      5.    RESERVED.

                                      -2-
<PAGE>

      6.    CONFIDENTIAL INFORMATION.

            (a) As used throughout this Agreement, the term "Confidential
Information" means any information you acquire during employment by the Company
(including information you conceive, discover or develop) which is not readily
available to the general public and which relates to the business, including
research and development projects, of the Company, its subsidiaries or its
affiliated companies.

            (b) Confidential Information includes, without limitation,
information of a technical nature (such as trade secrets, inventions,
discoveries, product requirements, designs, software codes and manufacturing
methods), matters of a business nature (such as customer lists, the identities
of customer contacts, information about customer requirements and preferences,
the terms of the Company's contracts with its customers and suppliers, and the
Company's costs and prices), personnel information (such as the identities,
duties, customer contacts, and skills of the Company's employees) and other
financial information relating to the Company and its customers (including
credit terms, methods of conducting business, computer systems, computer
software, personnel data, and strategic marketing, sales or other business
plans). Confidential Information may or may not be patentable.

            (c) Confidential Information does not include information which you
learned prior to employment with the Company from sources other than the
Company, information you develop after employment from sources other than the
Company's Confidential Information or information which is readily available to
persons with equivalent skills, training and experience in the same fields or
fields of endeavor as you. You must presume that all information that is
disclosed or made accessible to you during employment by the Company is
Confidential Information if you have a reasonable basis to believe the
information is Confidential Information or if you have notice that the Company
treats the information as Confidential Information.

            (d) Except in conducting the Company's business, you shall not at
any time, either during or following your employment with the Company, make use
of, or disclose to any other person or entity, any Confidential Information
unless (i) the specific information becomes public from a source other than you
or another person or entity that owes a duty of confidentiality to the Company
and (ii) twelve months have passed since the specific information became public.
However, you may discuss Confidential Information with employees of the Company
when necessary to perform your duties to the Company. Notwithstanding the
foregoing, if you are ordered by a court of competent jurisdiction to disclose
Confidential Information, you will officially advise the Court that you are
under a duty of confidentiality to the Company hereunder, take reasonable steps
to delay disclosure until the Company may be heard by the Court, give the
Company prompt notice of such Court order, and if ordered to disclose such
Confidential Information you shall seek to do so under seal or in camera or in
such other manner as reasonably designed to restrict the public disclosure and
maintain the maximum confidentiality of such Confidential Information.

            (e) Upon Employment Separation, you shall deliver to the Company all
originals, copies, notes, documents, computer data bases, disks, and CDs, or
records of any kind that reflect or relate to any Confidential Information. As
used herein, the term "notes" means written or printed words, symbols, pictures,
numbers or formulae. As used throughout this

                                      -3-
<PAGE>

Agreement, the term "Employment Separation" means the separation from and/or
termination of your employment with the Company, regardless of the time, manner
or cause of such separation or termination.

      7.    INVENTIONS.

            (a) As used throughout this Agreement, the term "Inventions" means
any inventions, improvements, designs, plans, discoveries or innovations of a
technical or business nature, whether patentable or not, relating in any way to
the Company's business or contemplated business if the Invention is conceived or
reduced to practice by you during your employment by the Company. Inventions
includes all data, records, physical embodiments and intellectual property
pertaining thereto. Inventions reduced to practice within one year following
Employment Separation shall be presumed to have been conceived during
employment.

            (b) Inventions are the Company's exclusive property and shall be
promptly disclosed and assigned to the Company without additional compensation
of any kind. If requested by the Company, you, your heirs, your executors, your
administrators or legal representative will provide any information, documents,
testimony or other assistance needed for the Company to acquire, maintain,
perfect or exercise any form of legal protection that the Company desires in
connection with an Invention.

            (c) Upon Employment Separation, you shall deliver to the Company all
copies of and all notes with respect to all documents or records of any kind
that relate to any Inventions.

      8.    NONCOMPETITION AND NONSOLICITATION.

            (a) By entering into this Agreement, you acknowledge that the
Confidential Information has been and will be developed and acquired by the
Company by means of substantial expense and effort, that the Confidential
Information is a valuable asset of the Company's business, that the disclosure
of the Confidential Information to any of the Company's competitors would cause
substantial and irreparable injury to the Company's business, and that any
customers of the Company developed by you or others during your employment are
developed on behalf of the Company. You further acknowledge that you have been
provided with access to Confidential Information, including Confidential
Information concerning the Company's major customers, and its technical,
marketing and business plans, disclosure or misuse of which would irreparably
injure the Company.

            (b) In exchange for the consideration specified in Section 1 of this
Agreement -- the adequacy of which you expressly acknowledge -- you agree that
during your employment by the Company and for a period of twelve (12) months
following Employment Separation, you shall not, directly or indirectly, as an
owner, shareholder, officer, employee, manager, consultant, independent
contractor, or otherwise:

                  (i) Attempt to recruit or hire, interfere with or harm, or
      attempt to interfere with or harm, the relationship of the Company, its
      subsidiaries or affiliates, with any person who is an employee, customer
      or supplier of the Company, it subsidiaries or affiliates;

                                      -4-
<PAGE>

                  (ii) Contact any employee of the Company for the purpose of
      discussing or suggesting that such employee resign from employment with
      the Company for the purpose of becoming employed elsewhere or provide
      information about individual employees of the Company or personnel
      policies or procedures of the Company to any person or entity, including
      any individual, agency or company engaged in the business of recruiting
      employees, executives or officers; or

                  (iii) Own, manage, operate, join, control, be employed by,
      consult with or participate in the ownership, management, operation or
      control of, or be connected with (as a stockholder, partner, or
      otherwise), any business, individual, partner, firm, corporation, or other
      entity that competes or plans to compete, directly or indirectly, with the
      Company, its products, or any division, subsidiary or affiliate of the
      Company; provided, however, that your "beneficial ownership," either
      individually or as a member of a "group" as such terms are used in Rule
      13d of the General Rules and Regulations under the Securities Exchange Act
      of 1934, as amended (the "Exchange Act"), of not more than two percent
      (2%) of the voting stock of any publicly held corporation, shall not be a
      violation of this Agreement.

      9.    TERMINATION OF EMPLOYMENT.

            (a) Termination Upon Death or Disability. Your employment will
terminate automatically upon your death. The Company will be entitled to
terminate your employment because of your disability upon 30 days written
notice. "Disability" will mean "total disability" as defined in the Company's
long term disability plan or any successor thereto. In the event of a
termination under this Section 9(a), the Company will pay you only the earned
but unpaid portion of your Basic Salary through the termination date.

            (b) Termination by Company for Cause. An Employment Separation for
Cause will occur upon a determination by the Company that "Cause" exists for
your termination and the Company serves you written notice of such termination.
As used in this Agreement, the term "Cause" shall refer only to any one or more
of the following grounds:

                  (i) Commission of an act of dishonesty involving the Company,
      its business or property, including, but not limited to, misappropriation
      of funds or any property of the Company;

                  (ii) Engagement in activities or conduct clearly injurious to
      the best interests or reputation of the Company;

                  (iii) Willful and continued failure substantially to perform
      your duties under this Agreement (other than as a result of physical or
      mental illness or injury), after the Board of Directors of the Company
      delivers to you a written demand for substantial performance that
      specifically identifies the manner in which the Board believes that you
      have not substantially performed your duties;

                                      -5-
<PAGE>

                  (iv) Illegal conduct or gross misconduct that is willful and
      results in material and demonstrable damage to the business or reputation
      of the Company;

                  (v) The clear violation of any of the material terms and
      conditions of this Agreement or any other written agreement or agreements
      you may from time to time have with the Company;

                  (vi) The clear violation of the Company's code of business
      conduct or the clear violation of any other rules of behavior as may be
      provided in any employee handbook which would be grounds for dismissal of
      any employee of the Company; or

                  (vii) Commission of a crime which is a felony, a misdemeanor
      involving an act of moral turpitude, or a misdemeanor committed in
      connection with your employment by the Company which causes the Company a
      substantial detriment.

            No act or failure to act shall be considered "willful" unless it is
done, or omitted to be done, by you in bad faith or without reasonable belief
that your action or omission was in the best interests of the Company. Any act
or failure to act that is based upon authority given pursuant to a resolution
duly adopted by the Board of Directors, or the advice of counsel for the
Company, shall be conclusively presumed to be done, or omitted to be done, by
you in good faith and in the best interests of the Company.

            In the event of a termination under this Section 9(b), the Company
will pay you only the earned but unpaid portion of your Basic Salary through the
termination date.

            Following a termination for Cause by the Company, if you desire to
contest such determination, your sole remedy will be to submit the Company's
determination of Cause to arbitration in Columbus, Ohio before a single
arbitrator under the commercial arbitration rules of the American Arbitration
Association. If the arbitrator determines that the termination was other than
for Cause, the Company's sole liability to you will be the amount that would be
payable to you under Section 9(d) of this Agreement for a termination of your
employment by the Company without Cause. Each party will bear his or its own
expenses of the arbitration.

            (c) Termination by You. In the event of an Employment Separation as
a result of a termination by you for any reason, you must provide the Company
with at least 14 days advance written notice ("Notice of Termination") and
continue working for the Company during the 14-day notice period, but only if
the Company so desires to continue your employment and to compensate you during
such period.

            In the event of such termination under this Section, the Company
will pay you the earned but unpaid portion of your Basic Salary through the
termination date.

            (d) Termination by Company Without Cause. The Company may terminate
your employment without Cause at any time by giving you notice thereof. In the
event of an Employment Separation as a result of termination by the Company
without Cause, the Company will pay you the earned but unpaid portion of your
Basic Salary through the termination date, and if you are eligible for a cash
bonus under a bonus plan determined annually by the Board of Directors

                                      -6-
<PAGE>

of the Company you will be paid a pro-rated portion of any bonus earned based on
the number of days in the year that you were employed by the Company, payable at
the same time as other eligible employees of the Company are paid their bonuses.
In addition, if the Company has entered into a definitive agreement or
agreements to engage in either a Transaction or Sale Transaction (as such terms
are defined in Section 9(e)(v) below) prior to your Employment Separation as a
result of termination by the Company without Cause, and a Change in Control (as
such term is defined in Section 9(e)(v) below) occurs (i) as a result of
entering into such definitive agreement or agreements, and (ii) within 6 months
of your Employment Separation, then you shall also be entitled to the benefits
contained in Section 9(e) below, subject to the terms and conditions contained
in Section 9(e) below.

            (e) Change of Control. If a "Change in Control", as defined in
Section 9(e)(v), shall have occurred, then you shall be entitled to the benefits
described below:

                  (i) On the date of the Change in Control, you will be entitled
            to a lump sum cash payment equal to 2.0 times your Basic Salary in
            effect at the date of the Change in Control, regardless of whether
            or not your employment terminates at such time, payable on the date
            of the Change in Control if the circumstances of the Change in
            Control are known by the Company in advance and otherwise payable
            within three business days after the Change in Control.

                  (ii) All outstanding stock options and restricted stock awards
            issued to you shall become 100% vested and thereafter exercisable in
            accordance with such governing stock option or restricted stock
            agreements and plans.

                  (iii) Reserved.

                  (iv) Reserved.

                  (v) A "Change in Control" shall be deemed to have occurred if
            and when, after the date hereof, (i) any "person" (as that term is
            used in Section 13(d) and 14(d) of the Securities Exchange Act of
            1934, as amended (the "Exchange Act") on the date hereof), including
            any "group" as such term is used in Section 13(d)(3) of the Exchange
            Act on the date hereof, shall acquire (or disclose the previous
            acquisition of) beneficial ownership (as that term is defined in
            Section 13(d) of the Exchange Act and the rules thereunder on the
            date hereof) of shares of the outstanding stock of any class or
            classes of the Company which results in such person or group
            possessing more than 50% of the total voting power of the Company's
            outstanding voting securities ordinarily having the right to vote
            for the election of directors of the Company; or (ii) as the result
            of, or in connection with, any tender or exchange offer, merger or
            other business combination, or contested election, or any
            combination of the foregoing transactions (a "Transaction"), the
            owners of the voting shares of the Company outstanding immediately
            prior to such Transaction own less than a majority of the voting
            shares of the Company after the Transaction; or (iii) during any
            period of two consecutive years during the term of this Agreement,
            individuals who at the beginning of such period constitute the Board
            of Directors of the Company (or who take office following the
            approval of a majority of the directors

                                      -7-
<PAGE>

            then in office who were directors at the beginning of the period)
            cease for any reason to constitute at least one-half thereof, unless
            the election of each director who was not a director at the
            beginning of such period has been approved in advance by directors
            of the Company representing at least one-half of the directors then
            in office who were directors at the beginning of the period; or (iv)
            the sale, exchange, transfer, or other disposition of all or
            substantially all of the assets of the Company (a "Sale
            Transaction") shall have occurred.

                  (vi) If any portion of the payments and benefits provided
            under this Agreement to you, alone or with other payments and
            benefits, would constitute "parachute payments" within the meaning
            of Section 280G(b)(2) of the Internal Revenue Code of 1986, as
            amended (the "Code"), and shall be determined by the Company's
            independent compensation specialist to be nondeductible to the
            Company, then the aggregate present value of all of the amounts
            payable to you under Section 9(e) hereof shall be reduced to the
            maximum amount which would cause all of the payments under Section
            9(e) to be deductible and in such event you shall have the option,
            but not the obligation, to designate or select those kinds of
            payments which shall be reduced and the order of such reductions,
            but your failure to make such selections within a period of 30 days
            following notice of the determination that a reduction is necessary
            will result in a reduction of all such payments, pro rata. If you
            disagree with the determination of the reduced amount by the
            Company's independent compensation specialist, you may contest that
            determination by giving notice of such contest within 30 days of
            learning of the determination and may use an independent
            compensation specialist of your choice in connection with such
            contest. The Company shall pay all of your costs in connection with
            such contest if the ultimate determination by the two independent
            compensation specialists in consultation with each other, or by a
            third independent compensation specialist, jointly chosen by the two
            first-named independent compensation specialists in the event the
            first two cannot agree, represents a lesser reduction in the amounts
            payable under Section 9(e) hereof than the Company's independent
            compensation specialist established in the first instance.
            Otherwise, you shall pay your own and any additional costs incurred
            by the Company in contesting such determination. If there is a final
            determination by the Internal Revenue Service or a court of
            competent jurisdiction that the Company overpaid amounts under
            Section 280G of the Code, the amount of the overpayment shall be
            treated as a loan to you and shall be repaid immediately, together
            with interest on such amount at the prime rate of interest at
            Huntington National Bank, Columbus, Ohio, or any successor thereto,
            in effect from time to time. If the Internal Revenue Service or a
            court of competent jurisdiction finally determines, or if the Code
            or regulations thereunder shall change such that the Company
            underpaid you under Section 280G of the Code, the Company shall pay
            the difference to you with interest as specified above.

                  (vii) Reserved.

                  (viii) Upon any termination or expiration of this Agreement or
            any cessation of your employment hereunder, the Company shall have
            no further obligations under this Agreement and no further payments
            shall be payable by the Company to you,

                                      -8-
<PAGE>

            except as provided in Section 9 above and except as required under
            any benefit plans or arrangements maintained by the Company and
            applicable to you at the time of such termination, expiration or
            cessation of your employment.

                  (ix) The Company is aware that upon the occurrence of a Change
            in Control, the Board of Directors or a shareholder of the Company
            may then cause or attempt to cause the Company to refuse to comply
            with its obligations under this Agreement, or may cause or attempt
            to cause the Company to institute, or may institute litigation
            seeking to have this Agreement declared unenforceable, or may take
            or attempt to take other action to deny you the benefits intended
            under this Agreement. In these circumstances, the purpose of this
            Agreement could be frustrated. Accordingly, if following a Change in
            Control it should appear to you that the Company has failed to
            comply with any of its obligations under Section 9 of this Agreement
            or in the event that the Company or any other person takes any
            action to declare Section 9 of this Agreement void or enforceable,
            or institutes any litigation or other legal action designed to deny,
            diminish or to recover from you the benefits entitled to be provided
            to you under Section 9, and that you have complied with all your
            obligations under this Agreement, the Company authorizes you to
            retain counsel of your choice, at the expense of the Company as
            provided in this Section 9(e)(ix), to represent you in connection
            with the initiation or defense of any pre-suit settlement
            negotiations, litigation or other legal action, whether such action
            is by or against the Company or any Director, officer, shareholder,
            or other person affiliated with the Company, in any jurisdiction.
            Notwithstanding any existing or prior attorney-client relationship
            between the Company and such counsel, the Company consents to you
            entering into an attorney-client relationship with such counsel, and
            in that connection the Company and you agree that a confidential
            relationship shall exist between you and such counsel, except with
            respect to any fee and expense invoices generated by such counsel.
            The reasonable fees and expenses of counsel selected by you as
            hereinabove provided shall be paid or reimbursed to you by the
            Company on a regular, periodic basis upon presentation by you of a
            statement or statements prepared by such counsel in accordance with
            its customary practices, up to a maximum aggregate amount of
            $50,000. Any legal expenses incurred by the Company by reason of any
            dispute between the parties as to enforceability of Section 9 or the
            terms contained in Section 9(f), notwithstanding the outcome of any
            such dispute, shall be the sole responsibility of the Company, and
            the Company shall not take any action to seek reimbursement from you
            for such expenses.

            (f) The noncompetition periods described in Section 8 of this
Agreement shall be suspended while you engage in any activities in breach of
this Agreement. In the event that a court grants injunctive relief to the
Company for your failure to comply with Section 8, the noncompetition period
shall begin again on the date such injunctive relief is granted.

            (g) Nothing contained in this Section 9 shall be construed as
limiting your obligations under Sections 6, 7, or 8 of this Agreement concerning
Confidential Information, Inventions, or Noncompetition and Nonsolicitation.

                                      -9-
<PAGE>

      10.   REMEDIES; VENUE; PROCESS.

            (a) You hereby acknowledge and agree that the Confidential
Information disclosed to you prior to and during the term of this Agreement is
of a special, unique and extraordinary character, and that any breach of this
Agreement will cause the Company irreparable injury and damage, and consequently
the Company shall be entitled, in addition to all other legal and equitable
remedies available to it, to injunctive and any other equitable relief to
prevent or cease a breach of Sections 6, 7, or 8 of this Agreement without
further proof of harm and entitlement; that the terms of this Agreement, if
enforced by the Company, will not unduly impair your ability to earn a living or
pursue your vocation; and further, that the Company may cease paying any
compensation and benefits under Section 9 if you fail to comply with this
Agreement, without restricting the Company from other legal and equitable
remedies. The parties agree that the prevailing party in litigation concerning a
breach of this Agreement shall be entitled to all costs and expenses (including
reasonable legal fees and expenses) which it incurs in successfully enforcing
this Agreement and in prosecuting or defending any litigation (including
appellate proceedings) concerning a breach of this Agreement.

            (b) The parties agree that jurisdiction and venue in any action
brought pursuant to this Agreement to enforce its terms or otherwise with
respect to the relationships between the parties shall properly lie in either
the United States District Court for the Southern District of Ohio, Eastern
Division, Columbus, Ohio, or the Court of Common Pleas of Franklin County, Ohio.
Such jurisdiction and venue is exclusive, except that the Company may bring suit
in any jurisdiction and venue where jurisdiction and venue would otherwise be
proper if you may have breached Sections 6, 7, or 8 of this Agreement. The
parties further agree that the mailing by certified or registered mail, return
receipt requested, of any process required by any such court shall constitute
valid and lawful service of process against them, without the necessity for
service by any other means provided by statute or rule of court.

      11. EXIT INTERVIEW. Prior to Employment Separation, you shall attend an
exit interview if desired by the Company and shall, in any event, inform the
Company at the earliest possible time of the identity of your future employer
and of the nature of your future employment.

      12. NO WAIVER. Any failure by the Company to enforce any provision of this
Agreement shall not in any way affect the Company's right to enforce such
provision or any other provision at a later time.

      13. SAVING. If any provision of this Agreement is later found to be
completely or partially unenforceable, the remaining part of that provision of
any other provision of this Agreement shall still be valid and shall not in any
way be affected by the finding. Moreover, if any provision is for any reason
held to be unreasonably broad as to time, duration, geographical scope, activity
or subject, such provision shall be interpreted and enforced by limiting and
reducing it to preserve enforceability to the maximum extent permitted by law.

      14. NO LIMITATION. You acknowledge that your employment by the Company may
be terminated at any time by the Company or by you with or without cause in
accordance with the terms of this Agreement. This Agreement is in addition to
and not in place of other obligations of trust, confidence and ethical duty
imposed on you by law.

                                      -10-
<PAGE>

      15. GOVERNING LAW. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Ohio without reference to its choice of
law rules.

      16. FINAL AGREEMENT. This Agreement replaces any existing agreement
between you and the Company relating to the same subject matter and may be
modified only by an agreement in writing signed by both you and a duly
authorized representative of the Company.

      17. FURTHER ACKNOWLEDGMENTS. YOU ACKNOWLEDGE THAT YOU HAVE RECEIVED A COPY
OF THIS AGREEMENT, THAT YOU HAVE READ AND UNDERSTOOD THIS AGREEMENT, THAT YOU
UNDERSTAND THIS AGREEMENT AFFECTS YOUR RIGHTS, AND THAT YOU HAVE ENTERED INTO
THIS AGREEMENT VOLUNTARILY.

                                 APPLIED INNOVATION INC.

                                 By: /s/ Andrew J. Dosch
                                     -------------------------------------------
                                            Andrew J. Dosch
                                     Vice President and Chief Financial Officer

                                 EXECUTIVE:

                                          /s/ William H. Largent
                                    --------------------------------------------
                                                   William H. Largent

                                      -11-THIRD PARTY ADMINISTRATOR AGREEMENT 

          This
Agreement is being entered into by and between ChoicePoint Services Inc., a
Georgia corporation, whose principal business address is 1000 Alderman Drive,
Alpharetta, Georgia 30005 ("ChoicePoint") and XFormity, a _Texas_
corporation, whose principal business address is 14333 Proton Road, Dallas,
TX 75244 ("Administrator"), which provides third party
administrator services to Taco Bell Franchisees ("Customer")
which has entered into an agreement with ChoicePoint as described in paragraph
I.A. below, and is effective as of the date when last executed. In consideration
of the mutual promises and covenants contained herein, the parties agree as
follows: 

I. INFORMATION TO BE PROVIDED BY THE PARTIES

 A.          Customer
has entered into that certain Agreement for Service dated __________________,
which is attached hereto as Exhibit A, with ChoicePoint pursuant to which
Customer will purchase from ChoicePoint, through requests made by Administrator,
employment reports that include employment history, credit reports, criminal
record services, motor vehicle checks, state insurance checks and educational
history pertaining to consumers (hereinafter referred to as "Employment
Reports") for employment purposes as defined in the federal Fair Credit
Reporting Act, 15 U.S.C.A. 1681 et seq., and its state analogues ("FCRA").
Customer has also entered into that certain
Customer Agreement Authorizing Third Party Administrator dated
______________________, with ChoicePoint pursuant to which Customer has
authorized Administrator to request Employment Reports from ChoicePoint. Neither
Administrator nor Customer is by reason of this Agreement required to order or
request any Employment Reports, but this Agreement and the Agreement for Service
shall govern all transactions regarding all such orders and requests.

 B.          ChoicePoint
shall not be responsible for the accuracy and adequacy of any information
supplied by Customer or Administrator to ChoicePoint for the purpose of
obtaining Employment Reports.

 II. USER RESTRICTIONS AND CONFIDENTIALITY

 A.          Administrator
shall interface with ChoicePoint only for the purpose of ordering Employment
Reports from ChoicePoint pursuant to this Agreement for the benefit of Customer,
and for no other purpose. Administrator has no right of access to ChoicePoint
products or services independent of Customer. Administrator shall not resell
Employment Reports to anyone, whether another customer of ChoicePoint or of
Administrator, or otherwise, either Administrator shall not accept Employment
Reports or store Employment Reports, in whole or in part, or any information
contained therein, in any database.

           Administrator
shall order the Employment Reports solely for the purposes permitted in this
Agreement and for no other purpose. ChoicePoint will provide Employment Reports
directly to Customer and Administrator will not knowingly accept, review or use
any Employment Report that ChoicePoint or Customer inadvertently provides to
Administrator. All Employment Reports shall be kept strictly confidential.
Requests to Administrator for Employment Reports from a consumer, who is the
subject of the information, or his representative, will promptly be referred to
ChoicePoint for disclosure under the FCRA or other applicable laws.
Administrator agrees to hold ChoicePoint and its affiliated companies, and all
of their respective officers, directors, agents, employees and independent
contractors harmless against all expense, damage or liability resulting from
disclosure of any information obtained from ChoicePoint by Administrator, its
officers, directors, employees, agents, or independent contractors, contrary to
the terms of this Agreement. If ChoicePoint reasonably determines that
Administrator is ordering any Employment Reports in a manner contrary to the
terms of this Agreement, ChoicePoint shall have, in addition to any other
remedies, the right to equitable relief enjoining such action.

 B.          Other
than the Employment Reports prepared specifically and exclusively for Customer,
all information at any time provided by ChoicePoint to Administrator is the
proprietary property solely of ChoicePoint and are confidential and are Trade
Secrets as that term is defined under Georgia law.

           ChoicePoint
and Administrator agree that they will, and will cause their respective
officers, directors, employees and agents to, keep and maintain such
confidential information and Trade Secrets strictly confidential, except as
expressly, and not by implication, permitted in this Agreement or otherwise
permitted by prior written consent of the owner. Either party shall be deemed to
have performed its obligations under this Agreement regarding confidentiality of
the other's confidential information and the aforesaid other information if the
receiving party shall at all times (a) disclose the confidential information or
other of the aforesaid information solely to those of its employees who shall
have a need to know thereof for the purpose of accessing the confidential
information pursuant to this Agreement, (b) require that all such employees keep
and maintain confidentiality of such information as required in this paragraph,
(c) promptly notify the owner of any breach of confidentiality including,
without limitation, that pertaining to customer identification numbers and/or
passwords, and (d) as to confidential information and other of the aforesaid
information, exercise at least that degree of diligence, care and control in
keeping and maintaining confidentiality of the same as the receiving party
customarily and consistently exercises in protecting the confidentiality of its
own proprietary and confidential information.

           In
the event of termination of this Agreement by either party hereto for whatever
reason, the receiving party shall promptly return and deliver or destroy, as
requested by the owner, to the owner all originals and all copies of all written
materials, programs, documentation, magnetic tapes and other media, and
derivatives of any of the foregoing, containing information provided by the
owner pursuant to the performance of this Agreement, or created by the receiving
party, its officers, directors employees, or agents, in which any of the
confidential information or other aforesaid information is contained or
reflected, and shall promptly under oath in writing delivered to the owner
certify to such return and delivery and/or destruction.

           The
terms of this Section II.B. as to Confidential Information survive termination
of this Agreement for a period of two (2) years. The terms of this Section II.B.
as to Trade Secrets survive termination of this Agreement for as long as is
provided under Georgia law.

 C.          With
respect to personal information regarding consumers, the Parties agree as
follows: ChoicePoint has adopted the "ChoicePoint Commitment to Privacy
"("Principles") and neither Administrator nor ChoicePoint will
commit or permit its directors, officers, employees or agents to commit any
action which causes Administrator, Customer or ChoicePoint to be in violation of
those Principles. A copy of the Principles are attached hereto as Exhibit A and
incorporated herein by reference.

 IV. PAYMENT

 Administrator will be billed by and shall pay to ChoicePoint
the charges for Employment Reports ordered for Customer through Administrator.
Administrator shall be responsible for all charges incurred, including those
resulting from errors in customer input, duplicate requests, errors in
transmission and applicable fees. Administrator will be billed once a month and
all invoices are payable thirty (30) days from date of invoice. Unpaid balances
thereafter carry one percent (1%) compounded monthly interest. Administrator
shall review all invoices furnished and shall notify ChoicePoint of any
discrepancies within fifteen (15) days of receipt of the invoice. The prices for
the component parts of Employment Reports shall be as set out in Exhibit B
attached hereto and incorporated herein by reference. Administrator irrevocably
and unconditionally guarantees the payment to ChoicePoint of all such charges if
Customer disputes the ordering of Employment reports by Administrator.

 V. GENERAL 

A.          Assignment:
Neither this Agreement nor any rights or duties hereunder may be assigned or
delegated by either ChoicePoint or Administrator without the prior written
consent of the other party, except that either party may assign its rights and
duties hereunder in their entirety, but not partially, to any corporation,
partnership or business entity which controls, is controlled by, or is under
common control with, such assignor, without relieving in whole or in part the
obligations hereunder of such assignor, provided that the assignee shall in
writing delivered to the other party, assume all obligations of the assignor
hereunder, and agree to be bound hereunder in the same manner as the assignor.

 B.          Performance
by ChoicePoint - General: ChoicePoint specifically reserves the right to
perform hereunder through its agents, independent contractors, and affiliated
companies, including their agents and independent contractors. This Agreement
shall be construed and enforced in accordance with the laws of Georgia. 

C.          Captions: Captions used herein are for convenience only, are not part
  of this Agreement and shall not be used in construing it.
D.          Entire Agreement: Except as to matters of pricing of consumer reports,
  which are the subjects of separate agreements, this Agreement constitutes the
  entire agreement and understanding between the parties hereto regarding the
  subject matters hereof, and any and all prior other agreements or
  understandings regarding such subject matters are merged herein.

E.         Modification: This agreement may be modified only by written amendment
  executed and delivered by both parties hereto.
F.         Counterparts: This Agreement may be executed in two or more
  counterparts, each of which shall take effect as an original, and all of
  which, together, shall constitute and evidence one and the same agreement.

G.        Third-Party Benefits: This Agreement is for the benefit of the
  signatory parties hereto and Customer only, and no other person or entity
  shall be deemed to have been granted any right or benefit hereunder. 

VI. TERM AND TERMINATION 

This Agreement shall become effective on the date of
execution by the last of the parties to sign hereunder and shall remain in
effect for a period of _1_ years thereafter. 

Notwithstanding the foregoing, this Agreement shall
automatically terminate as to the right of Administrator to request Employment
Reports on behalf of or for the benefit of Customer during such time or times as
(a) ChoicePoint shall notify Administrator in writing that such Customer has
ceased to have any right to receive Employment Reports, (b) Customer terminates
in writing Administrator's authorization to request Employment Reports from
ChoicePoint on behalf of Customer or (c) ChoicePoint notifies Administrator in
writing that Administrator has violated the terms of this contract.

 Either party, at its option, may immediately terminate this
Agreement in the event of breach or default by the other party. Either party may
terminate this Agreement for any cause or no cause, upon sixty (60) days' prior
written notice to the other party. 

The terms of Sections II.A, IV and V. survive termination of
this Agreement for any reason. 

IN WITNESS WHEREOF, the parties have executed this Agreement
on the dates indicated below: 

	
      Customer: ________________________
	 	
      CHOICEPOINT SERVICES INC.

	
      By: ______________________________
	 	
      By: ______________________________

	
      Title: ____________________________
	 	
      Title: _____________________________

	
      Date: ____________________________
	 	
      Date: _____________________________

 

EXHIBIT A 

ChoicePoint's Commitment to Privacy

ChoicePoint has been a trusted steward of information for years and has made
the responsible use of information the platform for everything that we do. To
demonstrate our commitment to balancing consumers' privacy expectations with the
appropriate, legal needs for quality information of our customers, ChoicePoint
has adopted the strongest privacy principles in the information industry. These
principles, based on the Fair Information Practices, are the cornerstone of our
information products. As part of our belief that good privacy is good business,
we require our customers to maintain the high standards of protection
surrounding the information we provide by complying with the following
principles1.

	 	
      *
	
      Relevance: Personal information should be collected, maintained, used,
      and disseminated only to improve public safety, to reduce fraud, to
      improve risk management, to improve the quality of our customer services
      and products, or to help drive down the cost of providing services and
      products.

	 	
      *
	
      Reputable Sources: Personal information should only be obtained from
      sources known to be reputable.

	 	
      *
	
      Notice: Consumers should be informed of the types of information about
      them that is obtained, how and when that information is used, when it
      might be disclosed, and how that information is secured.

	 	
      *
	
      Internal Uses: Access to personal information should be strictly
      limited to those employees who need access in order to carry out their job
      responsibilities.

	 	
      *
	
      Accuracy: Personal information should be as accurate as practicable.

	 	
      *
	
      Consumer Access: Consumers should be provided, upon request, with
      virtually all personal information maintained about that consumer.

	 	
      *
	
      Security: The confidentiality and security of personal information
      should be protected using administrative, technical, personnel, and
      physical safeguards.

 

 

 

 

 

 

 

 

_____________________________

1The principles above are an
abbreviated subset of the larger ChoicePoint privacy principles. Our full
privacy principles are available upon request at privacy@choicepoint.net or
(877) 301-7097.

EXHIBIT B

Service Pricing 

Choicepoint Services Group, Inc will initially provide the client searches at
a price of $4.50 each.

Ultimately, Choicepoint Services Group, Inc will provide the client with a
price per month of $25.00 per location. Each location will get 100 searches per
year to be pooled for all locations. All searches that exceed the yearly maximum
allowed will be billed at $5.00 per search. Both companies agree to meet in the
first 6 months to adjust the amount of searches.

A search is defined as a Social Security Validation, a National Criminal File
search and auto adjudication on all hits.

A location is defined as a separate and distinct operating unit and not a
company headquarters.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00078-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00078-of-00352.parquet"}]]