Compensation and employment agreements for KLC and KULG executives

of three years, unless terminated earlier, She serves as KLC’s President and COO with a fixed annual base salary of $300,000 plus bonuses, as well as stock appreciation rights. If KLC terminates Ms. Yalow’s employment at any time, other than for death, disability or cause, KLC is required to pay as severance, Ms. Yalow's base compensation for the balance of the severance period. In case of termination after expiration of the employment term, KLC is required to pay, in addition to the severance pay, unpaid base compensation earned as of the date of termination. In connection with employment arrangements for newly hired officers {including Peter Maslen, Derek Feng and Kal Raman), the Company is providing equity-based compensation in amounts to be agreed, which will be subject to customary terms and conditions. 15.6. KULG Arrangements Certain of the executives providing services to KUE and its subsidiaries are employees and officers of, or consultants to, KULG. Stephen Goldsmith, Senior Vice President of KULG, has a three-year employment agreement beginning February 1, 2005, terminable at will by KULG or Mr. Goldsmith, subject to severance benefits in certain circumstances and death and disability benefits. The agreement provides for a $500,000 annual salary and targeted $250,000 discretionary bonus. Nina Rees, Vice President of Strategic initiatives of KULG, has an employment agreement terminable by her or KULG with 90 days’ notice and providing an annuai salary of $180,000 plus a discretionary bonus. Ted Sanders has a 24- month consulting agreement with KULG beginning March 1, 2005 pursuant fo which he receives consulting fees at a $25,000 annual rate for the first 12 months and a $35,000 annual rate for the second 12 months. All of these amounts, together with the compensation of other KULG employees providing services to KUE will be paid from the annual overhead expense payment KUE will pay to KULG, as described in “Related Party Transactions.” 132 HOUSE_OVERSIGHT_024565