SEALIFE CORP
EX-10.1
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>ex10-1b.txt
<DESCRIPTION>EX-10.1
<TEXT>
                                                                    EXHIBIT 10.1

                                 FIRST AMENDMENT
                                       TO
                         EXECUTIVE EMPLOYMENT AGREEMENT



         This  First   Amendment  to  Executive   Employment   Agreement   (this
"AMENDMENT"),  effective  as of June 15,  2004,  is made and entered into by and
between SeaLife Corporation,  a Delaware corporation (the "COMPANY"),  and Barre
Rorabaugh  (the  "EXECUTIVE"),  and amends  that  certain  Executive  Employment
Agreement (the "AGREEMENT"),  made and entered into as of June 14, 2004, between
the Company and the Executive.

         Terms used but not defined  herein shall have the meanings  ascribed to
such terms in the Agreement.

                                    RECITALS

         WHEREAS,  pursuant to the terms of the Agreement,  the Company  engaged
the Executive as President of the  Company's  wholly-owned  subsidiary,  SeaLife
Marine Products, Inc. (the "SUBSIDIARY"),  with such duties and responsibilities
as those  normally  and  customarily  vested  in the  office of  President  of a
corporation;

         WHEREAS, the Company and the Executive desire to amend the Agreement to
provide for  "Gross-Up  Payments" to reflect the  agreement  between the parties
that Executive  shall be entitled to additional  compensation  in the event that
value of the  shares  Executive  receives  on the date of  payment  is more than
Executive's net proceeds upon the sale of such shares.

         NOW  THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency  of which is hereby  acknowledged,  and  agreeing to be bound by the
terms hereof, the parties to this Amendment hereby agree as follows:


                                    AMENDMENT

         I.       Section 4 of the  Agreement  shall be amended and  restated in
its entirety to read as follows:

         "4.      COMPENSATION; EXECUTIVE BENEFIT PLANS

                  4.1      BASE SALARY. The Company shall pay to the Executive a
         base salary (the "BASE  SALARY") at an annual rate of One Hundred Fifty
         Thousand  Dollars  ($150,000)  during  each  fiscal  year in which this
         Agreement  is  in  effect  (the  "REGULAR  COMPENSATION  ARRANGEMENT"),
         subject  to  adjustment,  upward but not  downward,  by the Board on an
         annual  basis at the  beginning  of each fiscal  year.  The Base Salary
         shall be payable in installments throughout the year in the same manner
         and at the same times the Company pays base salaries to other executive
         officers of the Company.


<PAGE>


         Notwithstanding  the  foregoing,  for  the  period  commencing  on  the
         Effective  Date  and  ending  on  the  date  the  Company  completes  a
         "QUALIFIED  FINANCING"  (as  defined  below),  the Base  Salary will be
         payable as follows (the "PRE-FINANCING COMPENSATION ARRANGEMENT"):  (i)
         payment monthly,  at the Company's  option, of either (a) a cash amount
         equal to two hundred  percent  (200%) of the  applicable  minimum  wage
         amount  then in effect in the State of  California  for a month of work
         based on forty  hours of work  per  week  (currently  calculated  to be
         $2,340.00 in the aggregate  for a month of work) (the "CASH  PORTION"),
         or (b) a number of shares of common stock,  par value $0.0001 per share
         of the Company ("COMMON Stock"), having a value at the time of issuance
         (the  "ISSUANCE  DATE"),  based on the average  trading price of Common
         Stock, as quoted on the Over The Counter Bulletin Board, for the twenty
         (20)  consecutive  trading  days  immediately  preceding  the  date  of
         issuance of such shares of Common  Stock (the "20-DAY  VOLUME  WEIGHTED
         AVERAGE VALUE"),  equal to the Cash Portion (the "OPTIONAL COMPENSATION
         COMMON  STOCK"),  to be issued  to the  Executive  without  restriction
         pursuant to a Form S-8  Registration  Statement (the "S-8  REGISTRATION
         STATEMENT"); plus (ii) issuance monthly of a number of shares of Common
         Stock having a 20-day  Volume  Weighted  Average Value of not less than
         $10,160.00 (the "MANDATORY COMPENSATION COMMON STOCK" and together with
         the  Optional  Compensation  Common  Stock,  the  "COMPENSATION  COMMON
         STOCK"), to be issued to the Executive without restriction  pursuant to
         the S-8  Registration  Statement.  For  purposes of this  Agreement,  a
         "QUALIFIED  FINANCING"  shall mean the  completion of an equity or debt
         financing  by the Company in which a gross  amount  equal to or greater
         than  $1,000,000  is  invested  in or loaned to the Company in one or a
         series of  related  transactions.  The  Company  will use  commercially
         reasonable  efforts to complete the Qualified  Financing within six (6)
         months  following the Effective Date. The Company will prepare and file
         the  S-8  Registration  Statement  as soon  as  reasonably  practicable
         following  the  Effective  Date,  and will update the S-8  Registration
         Statement and  otherwise  keep it current as necessary in order for the
         Executive  to receive and sell the  Compensation  Common Stock as it is
         issued  pursuant to valid  exemptions from  registration  statement and
         prospectus  delivery  requirements  under applicable  federal and state
         securities  laws.  The  foregoing  Pre-Financing  Arrangement  will  be
         pro-rated to and including  the date on which a Qualified  Financing is
         completed,  and thereafter the Regular  Compensation  Arrangement  will
         apply.

                  4.2      GROSS-UP PAYMENTS

                           (a)      In the  event  that all of the  Compensation
                  Common Stock  received by the Executive for services  provided
                  during any one month  period  (the  "COMPENSATION  PERIOD") is
                  offered  and  sold  by  Executive  pursuant  to  an  effective
                  registration  statement  on Form S-8  within  3 months  of the
                  Issuance  Date  of such  Compensation  Common  Stock,  and the
                  proceeds of the sale of such  Compensation  Common Stock, less
                  the  brokers  fees   attributable  to  such  sales  (the  "NET


<PAGE>


                  PROCEEDS"),  are less than the 20-day Volume Weighted  Average
                  Value as of the  Issuance  Date of such shares (the  "ISSUANCE
                  VALUE"),  then  Executive  shall be  entitled  to  receive  an
                  additional  payment (a "GROSS-UP  PAYMENT") in an amount equal
                  to the  difference  between the Net  Proceeds and the Issuance
                  Value (the  "GROSS-UP  VALUE"),  which shall be payable on the
                  last day of any calendar  month in which the Company  received
                  notice  of such  circumstances  pursuant  toe  SECTION  4.2(b)
                  hereof,  at the Company's option, in either (a) cash, or (b) a
                  number  of  shares  of  Common  Stock  having a 20-day  Volume
                  Weighted  Average Value at the time of issuance (the "ISSUANCE
                  DATE").

                           (b)      The  determination  as to whether a Gross-Up
                  Payment is required  pursuant to this Agreement and the amount
                  of such  Gross-Up  Payment  shall  be made  by  Executive  and
                  delivered, in writing, to the Company,  together with detailed
                  supporting   calculations   and   documentation  (a  "GROSS-UP
                  NOTICE").  Upon  completion  of the sale of all  common  stock
                  issued to Executive as a Gross-Up  Payment for any  particular
                  Compensation Period, Executive shall provide written notice to
                  Company  within ten (10)  business  days,  of the Net Proceeds
                  attributable  to the sale of such  shares  (the "NET  PROCEEDS
                  NOTICE")

                           (c)      If  the  Net  Proceeds   from  the  sale  of
                  Compensation Common Stock plus any Gross-Up Payment related to
                  a particular  Compensation Period will not equal or exceed the
                  related  Issuance  Value of the original  Compensation  Common
                  Stock Company shall continue to provide Gross-up  Payments for
                  such  Compensation  Period consistent with SECTIONS 4.2(a) and
                  (b) hereof, until the Net Proceeds and any subsequent Gross-Up
                  Payments   equal  or  exceed  the  Issuance   Value  for  such
                  Compensation Period.

                           (d)      If,  after  issuance  by  the  Company  of a
                  Gross-up  Payment with respect to any particular  Compensation
                  Period,  the Net  Proceeds  from the sale of any  Compensation
                  Common Stock plus any Gross-Up Payment related to a particular
                  Compensation  Period exceeds the related Issuance Value of the
                  original  Compensation Common Stock (an "EXCESS PAYMENT"),  as
                  reported to the Company in any Net Proceeds  Notice,  then the
                  Executives  next monthly  installment  of Base Salary shall be
                  reduced by an amount equal to the Excess Payment.

                  4.3      SEVERANCE.   In  the  event   that  the   Executive's
         employment is terminated pursuant to SECTION 3(e) above, subject to the
         qualification  set forth below with respect to terminations  that occur
         within one (1) year following the Effective Date: (i) the Company shall
         continue to pay the Executive's  then-current Base Salary in accordance
         with  SECTION  4.1  above,  (A) for a period  of two (2)  months if the
         effective date of such termination  occurs prior


<PAGE>


         to the three  (3)-month  anniversary  of the Effective  Date; (B) for a
         period of four (4)  months if the  effective  date of such  termination
         occurs between the three (3)-month and the six (6)-month  anniversaries
         of the  Effective  Date;  (C) for a  period  of six (6)  months  if the
         effective date of such termination occurs between the six (6)-month and
         the twelve (12)-month  anniversary of the Effective Date; and (D) for a
         period of twelve (12) months if the effective date of such  termination
         occurs after the twelve  (12)-month  anniversary of the Effective Date;
         and (ii) the  Executive  shall retain only those  options  described in
         SECTION 4.6 below that have vested prior to the effective  date of such
         termination.   Notwithstanding   the   foregoing,   in  the  event  the
         Executive's  employment is  terminated in accordance  with SECTION 3(e)
         above within one (1) year  following the Effective  Date, the severance
         payment described above will be paid (i) one-half in the form of Common
         Stock  having  a value at the time of  issuance,  based on the  average
         trading  price of  Common  Stock,  as  quoted  on the Over The  Counter
         Bulletin  Board,   for  the  twenty  (20)   consecutive   trading  days
         immediately  preceding  the date of  issuance  of such shares of Common
         Stock, of not less than one-half of the dollar amount of the applicable
         severance  payment to be issued to the  Executive  without  restriction
         pursuant to a Form S-8 Registration Statement, and (ii) one-half in the
         form of Common Stock  having a value at the time of issuance,  based on
         the average  trading price of Common  Stock,  as quoted on the Over The
         Counter Bulletin Board,  for the twenty (20)  consecutive  trading days
         immediately  preceding  the date of  issuance  of such shares of Common
         Stock, of not less than one-half of the dollar amount of the applicable
         severance  payment  the resale of which is subject to the  restrictions
         under  Rule 144  promulgated  under  the  Securities  Act of  1933,  as
         amended.  In  addition,  the Company  shall not be obligated to pay the
         Executive  any  amounts  hereunder  following  the  termination  of the
         Executive's  employment  pursuant to SECTION  3(e) above from and after
         any  time  that the  Executive  accepts  an  employment  or  consulting
         position with any person or entity that is determined by the Board,  in
         the exercise of its  reasonable  discretion,  to be a competitor of the
         Company.

                  4.4      PERFORMANCE  BONUS. In addition to the Base Salary to
         be paid to the Executive hereunder, the Company shall pay the Executive
         a  performance  bonus (the "BONUS")  determined  in  accordance  with a
         management  incentive  plan to be agreed upon between the Executive and
         the Board (the  "MANAGEMENT  INCENTIVE  PLAN") on an annual basis.  The
         Management Incentive Plan will provide for the payment of Bonus amounts
         equal to the respective  percentages of the Company's targeted earnings
         before  interest and tax set forth in EXHIBIT A attached  hereto and by
         this reference  made a part hereof,  and for payments of such lesser or
         greater Bonus amounts upon achieving  results less than or greater than
         the  targeted  objectives  as  shall  be  contained  in the  applicable
         Management Incentive Plan.

                  4.5      VACATION.  The Executive  shall be entitled each year
         to  vacation  for a  minimum  of four (4)  calendar  weeks,  plus  such
         additional

<PAGE>


         period or  periods  as the Board may  approve  in the  exercise  of its
         reasonable discretion, during which time his compensation shall be paid
         in full.

                  4.6      STOCK OPTIONS. The Executive shall be granted options
         (the  "OPTIONS") to purchase  shares of Common Stock in the  respective
         amounts  set forth on  EXHIBIT  A upon  achievement  of the  respective
         targets specified  thereon,  in each case at a per share exercise price
         equal to the "fair market value" of such shares on the date of grant as
         set forth in the Company's Stock Incentive Plan (the "STOCK Plan"). The
         Options  shall be issued  pursuant to the terms of the Stock Plan,  and
         shall vest as to 1/48th of the Options on the last day of each calendar
         month thereafter until fully vested.  The Option Agreement  pursuant to
         which the Options are granted will provide for the  acceleration of all
         vesting upon a change of control, as defined in the Option Agreement.

                  4.7      EXPENSE   REIMBURSEMENTS.   The  Executive  shall  be
         entitled to reimbursement from the Company for the reasonable costs and
         expenses  which he incurs in  connection  with the  performance  of his
         duties and obligations under this Agreement in a manner consistent with
         the  Company's  practices and policies as adopted or approved from time
         to time by the Board for executive officers.

                  4.8      WITHHOLDING.   The   Company   may  deduct  from  any
         compensation payable to the Executive the minimum amounts sufficient to
         cover  applicable  federal,  state and/or local income tax withholding,
         old-age  and  survivors'  and other  social  security  payments,  state
         disability and other insurance premiums and payments ("TAXES").  To the
         extent that the Executive receives Compensation Common Stock, Executive
         shall be  responsible  for any and all  amounts of Taxes the Company is
         required  to (or would be  required  to) pay or withhold as a result of
         the  grant  of  Compensation  Common  Stock  in  accordance  with  this
         Agreement.  Accordingly,  within five (5) business days of the delivery
         of any  shares  of  Compensation  Common  Stock to the  Executive,  the
         Executive  shall  pay  over  to the  Company  the  amounts  of  minimum
         withholding  requirements  of Taxes  (as  stated  in a  written  notice
         delivered  to  the   Executive   concurrently   with  the  delivery  of
         Compensation Common Stock) the Company will be required to (or would be
         required  to)  pay in  connection  with  the  issuance  of any  and all
         Compensation  Common  Stock to the  Executive in  accordance  with this
         Agreement.

                  4.9      PAYMENT    MECHANICS.    The   Company   may   issue,
         periodically  as payments are due or as an  aggregate  sum for a period
         agreed upon by the Company and the Executive,  any Compensation  Common
         Stock issuable pursuant to the terms of SECTION 4 of this Agreement. In
         the event the  Company  determines  to issue an  aggregate  sum for any
         agreed upon period  pursuant to this SECTION 4.9, the  Executive  shall
         only be permitted  to draw down or  otherwise  receive and utilize such
         shares  of  Compensation   Common  Stock  as  shall  be  sufficient  to
         compensate the Executive for any periodic


<PAGE>


         payments then due pursuant to the terms of this Agreement, upon written
         approval  of such  draw  down  from the  Company.  Unless  the  Company
         provides  written  notice to the  Executive  detailing  the reasons for
         which it shall not provide such  approval,  the Company  shall  provide
         written  approval  pursuant to this  SECTION 4.9 no later than the date
         that any periodic payment required under SECTION 4 shall become due."

         II.      Except as expressly  modified herein, all terms and conditions
of the Agreement are hereby ratified, confirmed and approved and shall remain in
full force and effect.  In the event of any  conflict or  inconsistency  between
this Amendment and the Agreement, this Amendment shall govern.


<PAGE>


         IN WITNESS  WHEREOF,  the parties have executed this First Amendment to
Executive Employment Agreement as of the date first above written.







PARENT                                               SEALIFE CORPORATION,
                                                     a Delaware corporation





                                                     By     /s/ Robert McCaslin
                                                            -------------------
                                                     Name:  Robert McCaslin

                                                     Title: CEO





EXECUTIVE                                            /s/ Barre Rorabaugh
                                                     --------------------------
                                                     Barre Rorabaugh
</TEXT>
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