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The Company has entered into an employment agreement with Mr. Geers, the Company’s Chief Operating Officer. The agreement covers the period February 1, 2007 through January 31, 2008, with provisions for automatic annual renewals and contains the provisions described below and other usual and customary provisions found in executive employment agreements. The agreement provides that he will serve as the Company’s Vice President Product Development and Chief Operating Officer throughout the term of the agreement, his base salary will be $199,500, subject to annual adjustment at the discretion of the Compensation Committee, which adjustment has not been determined for 2007. If his employment is terminated for reasons other than Good Cause, Death or Disability, he will receive severance equal to sixty percent times the then current total compensation, including base compensation and sixty percent of the higher of the Non-equity Incentive Plan Awards paid in the prior fiscal year or earned in the then current fiscal year to date all of which shall be paid within 90 days following termination. He will also be subject to a non-compete provision for a period of one year following termination of employment. In the event that, within twelve months of a change in control, his employment is terminated, he will receive a lump sum payment equal to sixty percent of his then current salary and all stock options granted shall immediately vest in full. The total cost to the Company upon termination in such events would be $147,763 based upon his Base Salary and Non-Equity Incentive Compensation in 2006, and the Company’s closing stock price of $5.64 per share on January 31, 2007, the last day of the Company’s 2006 fiscal year.
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