EXECUTIVE EMPLOYMENT AGREEMENT

written, which could reasonably be expected by Executive to injure the Company’s business, financial condition, results of operations, prospects, interests or reputation.

(c)

Executive agrees to comply at all times during the Employment Term with all applicable policies, rules, codes and regulations of the Company in effect from time to time, including, without limitation, all applicable codes of ethics or conduct and all policies regarding trading in the Company’s common stock.

4.

COMPENSATION AND BENEFITS.

(a)

BASE SALARY. During the Employment Term, the Company shall pay Executive a base salary at the annual rate of $500,000 USD, or such higher rate as may be determined from time to time by the Board of Directors or a duly authorized committee thereof (such amount, as increased from time to time, the “Base Salary”). Such Base Salary shall be paid on the Company’s regular pay days in accordance with the Company’s standard payroll practice for executive officers, subject only to such payroll and withholding deductions as may be required by law and other deductions applied generally to employees of the Company for insurance and other employee benefit plans. For all purposes under this Agreement, Executive’s Base Salary shall include any amount which is deferred under any nonqualified plan or arrangement of the Company.

(b)

INCENTIVE COMPENSATION.

(c)

BENEFIT PLANS. Executive shall be eligible to participate in and receive benefits under all retirement, health and welfare benefit plans, programs and arrangements which are

from time to time available to full-time senior executive officers of the Company in accordance with the terms and conditions of such plans, programs and arrangements in effect from time to time. Such benefit plans, programs and arrangements will include family medical, family dental and family vision benefit plans and short-term and long-term disability plans, and may include, without limitation, life insurance plans, accidental death insurance plans, travel accident insurance plans, savings and retirement plans and pension plans (all such benefit plans, the “Benefit Plans”). At his option, Executive may pay directly the premiums for coverage under the above-mentioned disability plans and have the Company pay to him, as additional income, an amount equal to the amount of those premiums. Executive agrees to submit to a physical examination from time to time as requested by the Company to facilitate Executive’s participation in one or more Benefit Plans. The Company may terminate or reduce benefits under any such plans, programs or arrangements to the extent such reductions apply uniformly to all full-time senior executive officers of the Company, and Executive’s benefits shall be reduced or terminated accordingly. The Company’s obligations under this Section 4(c) are expressly conditioned on Executive and his family dependents taking all reasonable actions (including but not limited to enrolling in all health and welfare benefit programs, plans and arrangements which are from time to time available to the Company’s full-time senior executive officers as and when Executive and his family dependents become eligible to participate in such programs, plans and arrangements) and providing all information as the Company shall reasonably request and as is necessary for the Company to fulfill such obligations.

(d)

VACATION. In addition to normal statutory holidays recognized by the Company, Executive shall be entitled to the greater of (a) four weeks of paid vacation for each fiscal year during the Employment Term and (b) such other amount of paid vacation as may be afforded executive officers under the Company’s policies in effect from time to time (“Vacation Time”).

(e)

EXPENSE REIMBURSEMENT. The Company shall promptly reimburse Executive for travel and other out-of-pocket expenses incident to his position in accordance with the Company’s customary practices applicable to full-time senior executive officers. To the extent that these expense reimbursements are reportable as taxable income, they will be grossed up to include the tax due on them.

(f)

REIMBURSEMENT OF CERTAIN TAX EXPENSES. The Company shall, upon written demand by Executive accompanied by supporting invoices, promptly reimburse Executive for all costs and expenses (including reasonable legal, accounting and other advisory fees) incurred by Executive to (i) determine, in any tax year of Executive, the tax consequences to Executive of any amount payable (or reimbursable) under Section 7 hereof, or (ii) prepare responses to an Internal Revenue Service or Canada Revenue Agency audit of, and to otherwise defend, his personal income tax return for any year during the Employment Term or to defend himself in any administrative proceeding or civil litigation relating to any such tax return, in each case that is occasioned by or related to any audit by the Internal Revenue Service or the Canada Revenue Agency of the

Company’s income tax returns; provided, however, in no event shall the Company be required to reimburse Executive for costs and expenses in excess of seventy-five thousand United States dollars ($75,000 USD) in any given fiscal year pursuant to this Section 4(e).

(g)

FRINGE BENEFITS AND PERQUISITES. Executive shall be eligible to participate in and receive benefits under all fringe benefit plans, practices, policies and programs of the Company to the same extent, and subject to the same terms and conditions, as those arrangements are made available to full-time senior executive officers of the Company.

5.

TERMINATION OF EMPLOYMENT.

(i)

For purposes of this Agreement, the term “Cause” shall mean any of the following: (A) conviction of a crime (including conviction on a nolo contendre plea) involving the commission by Executive of a felony or of a misdemeanor involving, in the good faith judgment of the Board of Directors, fraud, dishonesty or moral turpitude; (B) Executive’s deliberate and continual refusal to perform the duties and responsibilities assigned to Executive under this Agreement (other than as a result of vacation permitted under this Agreement, sickness, illness or injury); (C) fraud or embezzlement by Executive, determined in accordance with the Company’s normal, internal investigative procedures consistently applied; (D) gross misconduct or gross negligence by Executive in connection with the business of the Company or an Affiliate (as defined herein) unless Executive reasonably believed, in good faith, that his acts or omissions were in or not

Opposed to the best interests of the Company (without intent of Executive to gain therefrom, directly or indirectly, a profit to which he was not legally entitled); or (E) any material breach by Executive of any of the provisions of Section 8 of this Agreement or of any provisions of the Confidentiality and Proprietary Information Agreement (as defined herein); provided, however, that the occurrence of an act or omission covered by clauses (B), (D) or (E) of this paragraph 5(c)(i) shall not constitute “Cause” if Executive remedies such act or omission within ten (10) business days after delivery by the Company of written notice to Executive in accordance with Section 15 hereof specifying in reasonable detail the facts and circumstances believed by the Company to constitute such “Cause.”

(ii)

Any determination of Cause under this Agreement shall be made by resolution duly adopted by the affirmative vote of at least two-thirds of the members of the Board of Directors (not including Executive if Executive is a member of the Board of Directors) at a meeting of the Board of Directors called and held for that purpose; provided that Executive shall have been given written notice of such meeting by certified mail at least ten (10) business days prior to the meeting and shall have been given the opportunity to be heard by the Board of Directors before such resolution is passed. The failure by the Company to follow the procedures set forth in this Section 5(c)(ii) shall result in the termination of the Executive’s employment being deemed to be a termination by the Company without Cause.

(i)

A change in Executive’s responsibilities or titles or any other action by the Company which represents a material diminution of Executive’s position, status or authority, except in connection with or as a result of the termination of Executive’s employment pursuant to any provision of this Section 5 (a “Dimunition”); provided , however that such Dimunition shall not constitute “Good Reason” or a “Good Reason Event” if the Company remedies such Dimunition within ten (10) business days after delivery by Executive of written notice to the Company in accordance with Section 15 hereof specifying in reasonable detail the facts and circumstances believed by Executive to constitute such Dimunition.

(ii)

A reduction by the Company in Executive’s Base Salary.

(iii)

A material breach by the Company of Section 4(c) hereof; provided, however that such a breach shall not constitute “Good Reason” or a “Good Reason Event” if the Company remedies such breach within ten (10) business days after delivery by Executive of written notice to the Company in accordance with Section 15 hereof specifying in reasonable detail the facts and circumstances believed by Executive to constitute a material breach of Section 4(c).

(iv)

The failure by the Company to pay Executive any material amount of his Base Salary, or any material amount of other compensation, that is due and payable under this Agreement within ten (10) business days after Executive makes written demand for such amount.

(v)

The failure by the Company to enter into a written agreement with any entity that purchases all or substantially all of the assets of the Company or any entity into which the Company is merged (each a “Successor”) pursuant to which such Successor agrees to assume all of the obligations of the Company under this Agreement at and effective as of the closing of such sale of assets or merger.

written notice to the Company specifying (i) that Executive wishes to terminate his employment with the Company pursuant to Section 5(e) hereof and (ii) indicating the effective date of termination (which effective date shall not be less than 30 days after the giving of such notice).

6.

COMPENSATION AND BENEFITS FOLLOWING TERMINATION OF EMPLOYMENT.

(i)

Executive or his beneficiaries or estate shall be entitled to receive, within fourteen (14) days after the effective date of termination, any accrued but unpaid Base Salary for services rendered by Executive to the Company prior to the date of termination, any accrued but unpaid expenses required to be reimbursed under this Agreement, and cash compensation (at a rate per day equal to the Base Salary divided by the number of business days in the relevant year) for any accrued Vacation Time that remained unused by the Executive at the time of termination; and

(ii)

Any earned benefits to which Executive (or his beneficiaries or estate) may be entitled pursuant to the plans, policies and arrangements referred to in Sections 4(b), 4(c) and 4(g) hereof shall be determined and paid in accordance with the terms of such plans, policies and arrangements. In the case of compensation previously deferred by Executive, all amounts previously deferred and not yet paid by the Company shall be paid to Executive (or his beneficiaries or estate) within fourteen (14) days after the effective date of termination unless such payment is inconsistent with the terms of any payment election made by Executive with respect to such deferred compensation.

(i)

Executive’s estate shall be entitled to be paid:

(B)

an aggregate amount equal to three (3) times the average of the Annual Bonuses paid to Executive in the three (3) most recently completed fiscal years preceding the effective date of termination , without regard to whether the payment of all or any portion of such Annual Bonus has been deferred (such average being hereinafter referred to as the “Bonus Average”), which shall be paid in equal installments on the Company’s regular pay days over the course of thirty-six (36) months from the effective date of termination; provided , however , that if at the time of termination Executive has not been employed by the Company for three fiscal years, the Bonus Average shall be deemed for all purposes of this Agreement to equal Executive’s Target Bonus Rate multiplied by his Base Salary at the rate in effect immediately prior to the effective date of termination. The Company may purchase insurance to cover all or any part of the obligations set forth in this Section 6(b)(i) and Executive agrees to submit to a physical examination from time to time to facilitate the procurement or renewal of such insurance. Any proceeds of such insurance paid to Executive or his beneficiaries or estate shall be considered a portion of the payments required to be made to Executive pursuant to this Section 6(b)(i) and shall not be in addition thereto.

(c)

TERMINATION BY REASON OF TOTAL DISABILITY. In the event that Executive’s employment is terminated by reason of Executive’s Total Disability pursuant to Section 5(b) hereof, the Company shall pay Executive the following compensation and benefits in addition to the compensation and benefits provided for in Section 6(a) above:

(A)

his Base Salary at the rate in effect immediately prior to the effective date of termination on the Company’s regular pay days for a period of three (3) years from the effective date of termination as if his employment had continued until the end of such three (3) year period; and

(B)

an aggregate amount equal to three (3) times the Bonus Average, which shall be paid in equal installments on the Company’s regular pay days over the course of thirty-six (36) months from the effective date of termination.