TICKETS COM INC
EXHIBIT 10.17
<DOCUMENT>
<TYPE>EX-10.17
<SEQUENCE>5
<FILENAME>a71194ex10-17.txt
<DESCRIPTION>EXHIBIT 10.17
<TEXT>

<PAGE>   1
                                                                   EXHIBIT 10.17

                              EMPLOYMENT AGREEMENT

               This Employment Agreement ("Agreement") is dated effective as of
November 22, 2000, between Tickets.com, Inc, a Delaware corporation ("Company"),
having its principal place of business at 555 Anton Boulevard, 12th Floor, Costa
Mesa, CA 92626 and MARDAN M. AFRASIABI ("Executive") residing at 517 Begonia
Avenue, Corona Del Mar, CA 92625.

In consideration of the mutual covenants and agreements set forth herein, the
parties hereto agree as follows:

                                    ARTICLE 1

                                   EMPLOYMENT

               The Company hereby employs Executive and Executive accepts
employment with the Company upon the terms and conditions herein set forth.

ARTICLE 1.1 Employment. The Company hereby employs Executive, and Executive
agrees to serve as the Company's Executive Vice President, Business Development,
reporting to the President, or in such other management position consistent with
Executive's experience and reputation in the industry as the Company shall
determine, during the term of this Agreement. Executive agrees to devote
Executive's full business time and attention and best efforts to the affairs of
the Company during the term of this Agreement.

ARTICLE 1.2 Term. Subject to the earlier termination of Executive's employment
by the Company pursuant to the provisions hereof, the term of employment of
Executive under this Agreement shall commence on the Effective Date shall
continue in effect for a period of two (2) years, plus any extension as provided
below. At the end of the initial term, or any additional term, this Agreement
shall automatically be extended for an additional one (1) year, unless either
Executive or Company gives written notice to the other of its desire to
terminate this Agreement at least six (6) months prior to the scheduled end of
the term.

                                    ARTICLE 2

                                  COMPENSATION

ARTICLE 2.1 Annual Salary. During the employment of Executive, the Company shall
pay to Executive an initial base salary at the annual rate of one hundred and
seventy-five thousand dollars ($175,000.00) (the "Base Salary"), payable on the
Company's regular payroll dates. The Company shall review Executive's Base
Salary annually and may, in its sole and absolute discretion, increase
Executive's Base Salary in light of Executive's performance, inflation and cost
of living, and other factors deemed relevant by the Company; provided, however,
Executive's Base Salary may not be decreased below the initial Base Salary
during the term of this Agreement. The President of the Company shall meet with
Executive annually to review Executive's performance, objectives and
compensation, including salary, bonus and stock options, and the Chief Executive
Officer shall then meet with the Compensation Committee of the Board to discuss
the same. If the Compensation Committee determines that any adjustments thereto
are appropriate they shall make a recommendation to the full Board and the Board
shall make such adjustments, as the Board deems appropriate, consistent with
this Agreement.


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ARTICLE 2.2 Bonus. In addition to Executive's Base Salary, Executive shall be
entitled to receive such other bonuses, if any, as shall be determined by the
Board of Directors of the Company (the "Board") in its sole and absolute
discretion.

ARTICLE 2.3 Stock Option. Executive has been granted stock options to purchase
shares of the Company's Common Stock pursuant to the Company's Stock Option
Plans. To the extent any options are outstanding at the time of a Corporate
Transaction or Change in Control (as defined in Article IV), all such Options
shall automatically vest in full on an accelerated basis so that the Options
will immediately become exercisable for all the shares as fully vested shares.
Notwithstanding the terms and conditions of the Option agreements and the
applicable stock option plans, Section 4.5 of this Agreement shall govern the
acceleration, if any, of the Options upon the Executive's termination of
employment.

ARTICLE 2.4 Reimbursement of Expenses. Executive shall be entitled to receive
prompt reimbursement of all reasonable and necessary expenses incurred by
Executive in performing services hereunder, provided that such expenses are
incurred and accounted for in accordance with the policies and procedures
established by the Company.

ARTICLE 2.5 Benefits. Executive shall be entitled to participate in and be
covered by health, insurance, pension and other employee plans and benefits
currently or hereafter established for the employees of the Company generally
(collectively referred to as the "Company Benefit Plans") on at least the same
terms as other executive officers of the Company, excluding the Chief Executive
Officer, subject to meeting applicable eligibility requirements.

ARTICLE 2.6 Vacations and Holidays. During Executive's employment with the
Company, Executive shall be entitled to an annual vacation leave of three (3)
weeks at full pay, or such greater vacation benefits as may be provided for by
the Company's vacation policies applicable to senior executives. Executive shall
be entitled to such holidays as are established by the Company for all
employees.


                                    ARTICLE 3

               CONFIDENTIALITY, NONDISCLOSURE AND NON-COMPETITION

ARTICLE 3.1 Confidentiality. Executive will not during Executive's employment by
the Company or thereafter at any time disclose, directly or indirectly, to any
person or entity or use for Executive's own benefit any trade secrets or
confidential information relating to the Company's business operations,
marketing data, business plans, strategies, employees, negotiations and
contracts with other companies, or any other subject matter pertaining to the
business of the Company or any of their clients, customers, consultants, or
licensees, known, learned, or acquired by Executive during the period of
Executive's employment by the Company (collectively "Confidential Information"),
except as may be necessary in the ordinary course of performing Executive's
particular duties as an employee of the Company and further excepting any such
information which is or becomes available to the public through no fault of
Executive. For purposes of this Article III, the term "Company" shall mean the
Company and each of its subsidiaries.

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ARTICLE 3.2 Return of Confidential Material. Executive shall promptly deliver to
the Company on termination of Executive's employment with the Company, whether
or not for cause and whatever the reason, or at any time the Company may so
request, all memoranda, notes, records, reports, manuals, drawings, blueprints,
Confidential Information and any other documents of a confidential nature
belonging to the Company, including all copies of such materials which Executive
may then possess or have under Executive's control. Upon termination of
Executive's employment by the Company, Executive shall not take any document,
data, or other material of any nature containing or pertaining to the
proprietary information of the Company.

ARTICLE 3.3 Prohibition on Solicitation of Customers. During the term of
Executive's employment with the Company and for a period of two (2) years
thereafter, Executive shall not, directly or indirectly, either for Executive or
for any other person or entity, solicit any person or entity to terminate such
person's or entity's contractual and/or business relationship with the Company,
nor shall Executive interfere with or disrupt or attempt to interfere with or
disrupt any such relationship. None of the foregoing shall be deemed a waiver of
any and all rights and remedies the Company may have under applicable law.

ARTICLE 3.4 Prohibition on Solicitation of Employees, Agents or Independent
Contractors After Termination. During the term of Executive's employment with
the Company and for a period of two (2) years thereafter, Executive will not
solicit any of the employees, agents or independent contractors of the Company
to leave the employ of the Company for a competitive company or business.
However, Executive may solicit any employee, agent or independent contractor who
voluntarily terminates his or her employment with the Company after a period of
90 days have elapsed since the termination date of such employee, agent or
independent contractor. None of the foregoing shall be deemed a waiver of any
and all rights and remedies the Company may have under applicable law.

ARTICLE 3.5 Non-competition.

        (a) Executive acknowledges that: (i) the services to be performed by
Executive under this Agreement are of a special, unique, unusual, extraordinary,
and intellectual character; (ii) the Company has required that Executive make
the covenants set forth in this Section 3.5 as a condition to the Company's
entering into this Agreement; and (iii) the provisions of this Section 3.5 are
reasonable and necessary to protect the business of the Company.

        (b) In consideration of the acknowledgments by Executive, and in
consideration of the compensation and benefits to be paid or provided to
Executive by the Company under this Agreement, Executive covenants that
Executive will not, directly or indirectly:

        1.      During the term of Executive's employment with the Company
                hereunder and for a period of two (2) years thereafter (the
                "Covenant Period"), engage or invest in, own, manage, operate,
                finance, control, or participate in the ownership, management,
                operation, financing, or control of, be employed by, associated
                with, or in any manner connected with, lend Executive's name or
                any similar name to, lend Executive's credit to, or render
                services or advice to, any business whose products or activities
                compete in the Territory (as defined below), directly or
                indirectly, with (I) the Company's ticketing products or
                services or (ii) with any products or services of the Company as
                of the time of the Executive's termination; provided, however,
                that Executive may purchase or otherwise acquire up to (but not
                more than) one percent of any class of securities of any
                enterprise (but without otherwise participating in the
                activities of such enterprise) if such securities are listed on
                any national or regional securities exchange or have been
                registered under Section 12(g) of the Securities Exchange Act of
                1934. Executive agrees


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                that this covenant is reasonable with respect to its duration,
                geographical area, and scope. For purposes hereof, "Territory"
                shall mean any county of any state of the United States of
                America, including any county in the States of California,
                Connecticut, Ohio or New York, and any other states or
                international jurisdictions in which the Company is doing
                business at the time of Executive's termination.

        2.      At any time during or after the Covenant Period, disparage the
                Company, or any of its shareholders, directors, officers,
                employees, or agents.

        (c) Executive will, for the Covenant Period, within ten days after
accepting any employment, advise the Company of the identity of any employer of
Executive. The Company may serve notice upon each such employer that Executive
is bound by this Agreement and furnish each such employer with a copy of this
Agreement or relevant portions thereof.

ARTICLE 3.6 Enforcement. It is the intent of the parties that the restrictive
covenants contained in this Article III are severable and separate and the
unenforceability of any individual provision shall not effect the enforceability
of any other. If any covenant in this Article III is held to be unreasonable,
arbitrary, or against public policy, such covenant will be considered to be
divisible with respect to scope, time, and geographic area, and such lesser
scope, time, or geographic area, or all of them, as a court of competent
jurisdiction may determine to be reasonable, not arbitrary, and not against
public policy, will be effective, binding and enforceable against the Executive.

ARTICLE 3.7 Survival of Obligations. Executive agrees that the terms of this
Article III shall survive the term of this Agreement and the termination of
Executive's employment by the Company.

                                    ARTICLE 4

                                   TERMINATION

ARTICLE 4.1 For purposes of this Article IV, the following definitions shall
apply to the terms set forth below:

        (a)    Cause.  "Cause" shall mean the following:

        1.      Habitual neglect or insubordination (defined as a refusal to
                execute or carry out directions from the Board or its duly
                appointed designees) where Executive has been given written
                notice of the acts or omissions constituting such neglect or
                insubordination and Executive has failed to cure such conduct,
                where susceptible to cure, within thirty (30) days following
                notice;

        2.      Conviction of any felony or any crime involving moral turpitude;

        3.      Participation in any fraud against the Company;

        4.      Willful breach of Executive's duties to the Company, including
                but not limited to theft from the Company, failure to fully
                disclose personal pecuniary interest in a transaction involving
                the Company, violation of the Company's authority limits on
                commitments, trading, controls and notification;

        5.      Intentional damage to any property of the Company;

        6.      Conduct by Executive which in the good faith, reasonable
                determination of the Board demonstrates gross unfitness to serve
                including, but not be limited to, gross neglect,
                non-prescription use of controlled substances, any abuse of
                controlled substances whether or not by prescription, or
                habitual drunkenness,


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                intoxication, or other impaired state induced by consumption of
                any drug, including alcohol; or

        7.      Material breach by the Executive of those provisions of this
                Agreement concerning non-competition or the confidentiality of
                trade secrets or proprietary or other information.

        (b) Change in Control. "Change in Control" shall mean a change in
ownership or control of the Company effected through either of the following
transactions:

        1.      The acquisition, directly or indirectly, by any person or
                related group of persons (other than the Company or a person
                that directly or indirectly controls, is controlled by, or is
                under common control with, the Company) of beneficial ownership
                (within the meaning of Rule 13d-3 of the 1934 Securities
                Exchange Act, as amended) of securities possessing more than
                fifty (50%) of the total combined voting power of the Company's
                outstanding securities pursuant to a tender or exchange offer
                made directly to the Company's stockholders, or

        2.      A change in the composition of the Company's Board over a period
                of thirty-six (36) consecutive months or less such that a
                majority of the Board members ceases, by reason of one or more
                contested elections for Board membership, to be comprised of
                individuals who either (a) have been Board members continuously
                since the beginning of such period or (b) have been elected or
                nominated for election as Board members described in clause (a)
                who were still in office at the time the Board approved such
                election or nomination.

        (c) Corporate Transaction. "Corporate Transaction" shall mean either of
the following stockholder-approved transactions to which the Company is a party:

        1.      A merger or consolidation in which securities possessing more
                than fifty percent (50%) of the total combined voting power of
                the Company's outstanding securities are transferred to a person
                or persons different from the persons holding those securities
                immediately prior to such transaction, or

        2.      The sale, transfer or other disposition of all or substantially
                all of the Company's assets in complete liquidation or
                dissolution of the Company.

        (d) Disability. "Disability" shall mean a physical or mental incapacity
as a result of which Executive becomes unable to continue the proper performance
of his duties hereunder (reasonable absences because of sickness for up to three
(3) consecutive months excepted; provided, however, that any new period of
incapacity or absences shall be deemed to be part of a prior period of
incapacity or absences if the prior period terminated within ninety (90) days of
the beginning of the new period of incapacity or absence and the incapacity or
absence is determined by the Company's Board of Directors, in good faith, to be
related to the prior incapacity or absence.) A determination of Disability shall
be subject to the certification of a qualified medical doctor agreed to by the
Company and Executive or, in the event of Executive's incapacity to designate a
doctor, Executive's legal representative. In the absence of agreement between
the Company and Executive, each party shall nominate a qualified medical doctor
and the two (2) doctors so nominated shall select a third doctor, who shall make
the determination as to Disability.

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        (e) Good Reason. "Good Reason" shall mean:

        1.      Assignment of the Executive without Executive's consent to a
                position, responsibilities or duties of a materially lesser
                status or degree of responsibility than his position,
                responsibilities or duties as of the date of this Agreement;

        2.      Relocation of the Executive outside of the Costa Mesa,
                California area without Executive's consent;

        3.      A reduction by the Company of the Executive's Base Salary below
                the initial Base Salary or, following a Change in Control, below
                Executive's Base Salary at the time of the Change in Control,
                without Executive's consent;

        4.      A failure by the Company to continue in effect, without
                substantial change, any benefit plan or arrangement in which the
                Executive was participating or the taking of any action by the
                Company which would adversely affect the Executive's
                participation in or materially reduce his benefits under any
                benefit plan (unless such failure, action or changes apply
                equally to substantially all other management employees of
                Company); or

        5.      Any material breach by the Company of any provision of this
                Agreement without the Executive having committed any material
                breach of Executive's obligations hereunder, which breach is not
                cured within thirty (30) days following written notice thereof
                to the Company of such breach; provided, however, that the
                events listed herein shall constitute "Good Reason" only for a
                period of ninety (90) days following the occurrence thereof.

ARTICLE 4.2 Termination by Company. The Company may terminate Executive's
employment hereunder immediately for Cause. Subject to the other provisions
contained in this Agreement, the Company may terminate this Agreement for any
reason other than Cause upon thirty (30) days' written notice to Executive. The
effective date of termination ("Effective Date") shall be considered to be the
date of notice of termination if for Cause and thirty (30) days subsequent to
written notice of termination for any reason other than Cause; however, the
Company may elect to have Executive leave the Company immediately.

ARTICLE 4.3 Termination by Executive. Executive may terminate this Agreement
upon thirty (30) days' written notice to the Company. The effective date of
termination ("Effective Date") shall be considered to be thirty (30) days
subsequent to written notice of termination; however, the Company may elect to
have Executive leave the Company immediately.

ARTICLE 4.4 Death or Disability of Executive. This Agreement shall terminate
immediately upon the death or Disability of Executive (the "Effective Date").

ARTICLE 4.5 Severance Benefits Received Upon Termination.

        (a) If Executive's employment is terminated by the Company for Cause, or
Executive terminates this Agreement without Good Reason, then the Company shall
pay Executive's Base Salary through the Effective Date of such termination plus
credit for any vacation earned but not taken and the Company shall thereafter
have no further obligations to Executive under this Agreement.

        (b) Except as otherwise provided in Section 4.5(c) below, if Executive's
employment is terminated by the Company without Cause or as a result of
Disability, or if Executive's employment is terminated by Employee for Good
Reason, then the Company shall provide Executive:

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        1.      Salary continuation in an amount equal to Executive's then Base
                Salary for a period of six (6) months, commencing on the
                Effective Date, said sum to be paid in equal installments at the
                times salary payments are usually made by the Company; and

        2.      Acceleration and immediate vesting of fifty percent (50%) of the
                unvested shares subject to each of the Executive's options
                outstanding at the Effective Date, excluding the Performance
                Options, and such accelerated options as well as any other
                options which have vested and which are then exercisable shall
                remain exercisable for the three (3)-month period measured from
                the Effective Date, except for Executive's termination by reason
                of a disability where the options shall remain exercisable for
                such fully vested shares until the expiration of the twelve
                (12)-month period measured from the Effective Date, and shall
                then expire and be of no further force or effect;

        3.      Health insurance coverage as then in effect for Executive,
                Executive's spouse and dependent children for a period of six
                (6) months, commencing on the Effective Date, subject to any
                employee contribution provisions as defined in the Company
                Benefit Plans. Subsequent health insurance benefits will be in
                accordance with COBRA. The Company shall thereafter have no
                further obligations under this Agreement.

        (c) If within twenty-four (24) months of a Corporate Transaction or
Change in Control the Executive's employment is terminated by the Company
without Cause or by Executive for Good Reason, then the Company shall provide
Executive:

        1.      Salary continuation in an amount equal to Executive's then Base
                Salary for a period of twelve (12) months, commencing on the
                Effective Date, said sum to be paid in equal installments at the
                times salary payments are usually made by the Company; and

        2.      Acceleration and immediate vesting of one hundred percent (100%)
                of Executive's options which have not yet vested by the
                Effective Date, excluding the Performance Options, and such
                accelerated options as well as any other options which have
                vested and which are then exercisable shall remain exercisable
                for a period of twelve (12) months following the Effective Date
                and shall then expire and be of no further force or effect; and

        3.      health insurance coverage as then in effect for Executive,
                Executive's spouse and dependent children for a period of twelve
                (12) months, commencing on the Effective Date, subject to any
                employee contribution provisions as defined in the Company
                Benefit Plans. Subsequent health insurance benefits will be in
                accordance with COBRA. The Company shall thereafter have no
                further obligations under this Agreement.

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        (d) If Executive's employment is terminated by the Company as a result
of death, then the Company shall pay Executive's Base Salary through the
Effective Date of such termination plus credit for any vacation earned but not
taken and the Company shall provide Executive's spouse and dependent children
health insurance coverage as then in effect for Executive, Executive's spouse
and dependent children for a period of two (2) months, subject to any employee
contribution provisions as defined in the Company Benefit Plans. Health
insurance benefits subsequent to the continuation period will be in accordance
with COBRA. The Company shall thereafter have no further obligations under this
Agreement.

        (e) Notwithstanding the foregoing, Executive shall not be entitled to
the severance benefits set forth in this Section 4.5 in the event of Executive's
termination upon expiration of the term of this Agreement.

ARTICLE 4.6 Expiration of Term. If Executive's employment is terminated as a
result of the expiration of the term of this Agreement, then the Company shall
pay Executive's Base Salary through the expiration date plus credit for any
vacation earned but not taken and the Company shall thereafter have no further
obligations under this Agreement.

ARTICLE 4.7 Benefit Limit. In the event that any payment or benefit (including
salary continuation payments, accelerated option vesting or continued health
care coverage) received or to be received by Executive pursuant to this
Agreement (collectively the `Payments") would constitute a parachute payment
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the "Code"), then the following limitation shall apply:

        The aggregate present value of those Payments shall be limited in amount
        to the greater of the following dollar amounts (the "Benefit Limit"):

        (a)    2.99 times Executive's Average Compensation, or

        (b)    The amount which yields Executive the greatest after-tax amount
               of Payments under this Agreement after taking into account any
               excise tax imposed under Code Section 4999 on those Payments.

        (c)    The present value of the Payments will be measured as of the date
               of the Change in Control or Corporate Transaction and determined
               in accordance with the provisions of Code Section 280G(d)(4).

        Average Compensation means the average of Executive's W-2 wages from the
        Company for the five (5) calendar years (or such fewer number of
        calendar years of employment with the Company) completed immediately
        prior to the calendar year in which the Change of Control or Corporate
        Transaction is effected. Any W-2 wages for a partial year of employment
        will be annualized, in accordance with the frequency, which such wages,
        are paid during such partial year, before inclusion in Average
        Compensation.

ARTICLE 4.8 Resolution Procedure. For purposes of the foregoing Benefit Limit,
the following provisions will be in effect:

        (a) In the event there is any disagreement between Executive and the
Company as to whether one or more Payments to which Executive becomes entitled
under this Agreement constitute parachute payments under Code Section 280G or as
to the determination of the present value thereof, such dispute will be resolved
as follows:

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        (b)

        1.      In the event temporary, proposed or final Treasury Regulations
                in effect at the time under Code Section 280G (or applicable
                judicial decisions) specifically address the status of any such
                Payment or the method of valuation therefor, the
                characterization afforded to such Payment by the Regulations (or
                such decisions) will, together with the applicable valuation
                methodology, be controlling.

        2.      In the event Treasury Regulations (or applicable judicial
                decisions) do not address the status of any Payment in dispute,
                the matter will be submitted for resolution to a
                nationally-recognized independent accounting firm mutually
                acceptable to Executive and the Company ("Independent
                Accountant"). The resolution reached by the Independent
                Accountant will be final and controlling; provided, however,
                that if in the judgment of the Independent Accountant the status
                of the payment in dispute can be resolved through the obtainment
                of a private letter ruling from the Internal Revenue Service, a
                formal and proper request for such ruling will be prepared and
                submitted, and the determination made by the Internal Revenue
                Service in the issued ruling will be controlling. All expenses
                incurred in connection with the retention of the Independent
                Accountant and (if applicable) the preparation and submission of
                the ruling request shall be borne by the Company.

ARTICLE 4.9 Reduction of Benefits. To the extent the aggregate present value of
the Payments would exceed the Benefit Limit, the salary continuation payments
will first be reduced, and then the accelerated vesting of the options (based on
their parachute value under Code Section 280G) will be reduced, to the extent
necessary to assure that such Benefit Limit is not exceeded.

                                    ARTICLE 5

                               GENERAL PROVISIONS

ARTICLE 5.1 Notices. All notices, demands, requests, consents, approvals or
other communications (collectively "Notices") required or permitted to be given
hereunder or which are given with respect to this Agreement shall be in writing
and may be personally served or may be deposited in the United States mail,
registered or certified, return receipt requested, postage prepaid, addressed as
follows:

               To the Company:      Tickets.com, Inc.
                                    555 Anton Boulevard 12th Floor
                                    Costa Mesa, CA 92626
                                    Attention: President

               To Executive:        Mardan M. Arfrsiabi
                                    517 Begonia Avenue
                                    Corona Del Mar, CA 92625

or such other address as such party shall have specified most recently by
written notice. Notice mailed as provided herein shall be deemed given on the
fifth business day following the date so mailed or on the date of actual
receipt, whichever is earlier.

ARTICLE 5.2 Proprietary Information and Inventions. Contemporaneously with the
execution of this Agreement, Executive shall execute a Proprietary Information
and Inventions Agreement in the

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form attached as Exhibit A hereto. The terms of said agreement are incorporated
by reference in this Agreement, and Executive agrees to be bound thereby.

ARTICLE 5.3 Covenant to Notify Management. Executive agrees to abide by the
ethics policies of the Company as well as the Company's other rules,
regulations, policies and procedures. Executive agrees to comply in full with
all governmental laws and regulations as well as ethics codes applicable to the
profession. In the event that Executive is aware or suspects the Company, or any
of its officers or agents, of violating any such laws, ethics codes, rules,
regulations, policies or procedures, Executive agrees to bring all such actual
and suspected violations to the attention of the Company immediately so that the
matter may be properly investigated and appropriate action taken. Executive
understands that he is precluded from filing a complaint with any governmental
agency or court having jurisdiction over wrongful conduct unless Executive has
first notified the Company of the facts and permits it to investigate and
correct the concerns.

ARTICLE 5.4 No Waivers. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing signed by Executive and the Company. No waiver by either party hereto at
any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.

ARTICLE 5.5 Beneficial Interests. This Agreement shall inure to the benefit of
and be enforceable by Executive's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
Executive should die while any amounts are still payable to him hereunder, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to Executive's devisee, legatee, or other designee
or, if there be no such designee, to Executive's estate.

ARTICLE 5.6 Choice of Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of California.

ARTICLE 5.7 Statute of Limitations. Executive and the Company hereby agree that
there shall be a one year statute of limitations for the filing of any requests
for arbitration or any lawsuit relating to this Agreement or the terms or
conditions of Executive's employment by the Company. If such a claim is filed
more than one year subsequent to Executive's last day of employment it shall be
precluded by this provision, regardless of whether or not the claim has accrued
at that time.

ARTICLE 5.8 Right to Injunctive and Equitable Relief. Executive's obligations
under Article III are of a special and unique character which gives them a
peculiar value. The Company cannot be reasonably or adequately compensated for
damages in an action at law in the event Executive breaches such obligations.
Therefore, Executive expressly agrees that the Company shall be entitled to
injunctive and other equitable relief without bond or other security in the
event of such breach in addition to any other rights or remedies which the
Company may possess or be entitled to pursue. Furthermore, the obligations of
Executive and the rights and remedies of the Company under Article III are
cumulative and in addition to, and not in lieu of, any obligations, rights, or
remedies created by applicable law.

ARTICLE 5.9 Severability or Partial Invalidity. The invalidity or
unenforceability of any provisions of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, which shall
remain in full force and effect.

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ARTICLE 5.10 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which taken together shall
constitute but one and the same instrument.


ARTICLE 5.11 Attorneys' Fees. In the event any action in law or equity,
arbitration or other proceeding is brought for the enforcement of this Agreement
or in connection with any of the provisions of this Agreement, the prevailing
party shall be entitled to his or its attorneys' fees and other costs reasonably
incurred in such action or proceeding.


ARTICLE 5.12 Entire Agreement. This Agreement, along with the Proprietary
Information and Inventions Agreement by and between Executive and the Company of
even date herewith (the "Proprietary Information Agreement"), constitutes the
entire agreement of the parties and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings, and negotiations between the
parties with respect to the subject matter hereof. This Agreement, along with
the Proprietary Information Agreement, is intended by the parties as the final
expression of their agreement with respect to such terms as are included herein
and therein and may not be contradicted by evidence of any prior or
contemporaneous agreement. The parties further intend that this Agreement, along
with the Proprietary Information Agreement, constitutes the complete and
exclusive statement of their terms and that no extrinsic evidence may be
introduced in any judicial proceeding involving such agreements.


ARTICLE 5.13 Assignment. This Agreement and the rights, duties, and obligations
hereunder may not be assigned or delegated by any party without the prior
written consent of the other party and any attempted assignment or delegation
without such prior written consent shall be void and be of no effect.
Notwithstanding the foregoing provisions of this Section 5.13, the Company may
assign or delegate its rights, duties, and obligations hereunder to any
affiliate or to any person or entity which succeeds to all or substantially all
of the business of the Company through merger, consolidation, reorganization, or
other business combination or by acquisition of all or substantially all of the
assets of the Company.


ARTICLE 5.14 Dispute Resolution. Except as provided in Section 5.8, any
controversy, dispute, claim or other matter in question arising out of or
relating to the interpretation, performance or breach of this Agreement shall be
finally determined, at the request of any party, by binding arbitration
conducted in accordance with the then existing rules for commercial arbitration
of the American Arbitration Association, and judgment upon any award rendered by
the arbitrator may be entered in any court having jurisdiction thereof. Such
arbitration shall be conducted in Orange County, California. The arbitrator
shall award to the prevailing party, in addition to the costs of the proceeding,
that party's reasonable attorney's fees. The Company reserves the right to seek
judicial provisional remedies and equitable relief regarding any breach or
threatened breach of Executive's obligations regarding the matters set forth in
Article III hereof.

                                       11
<PAGE>   12

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

                                    COMPANY




                                    By:           /S/
                                       -------------------------------
                                           Timothy E. Kelly
                                           President



                                    EXECUTIVE

                                                  /S/
                                    ---------------------------------
                                    Mardan M. Afrasiabi


                                       12

</TEXT>
</DOCUMENT>
