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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") made as of January 1, 1997, between Palomar
Medical Technologies, Inc., a Delaware corporation (the "Company"), and Joseph Caruso, an individual (the
"Executive"),
W I T N E S S E T H T H A T:
WHEREAS, the Company desires to employ Executive as its Chief Financial Officer for the period and upon and
subject to the terms herein provided; and
WHEREAS, the Company desires to be assured that Executive will not compete with the Company for the
period and within the geographical areas hereinafter specified; and
WHEREAS, Executive is willing to agree to be employed by the Company for the period and upon and subject
to the terms herein provided; and
WHEREAS, Executive does not desire to work for the Company in a position lower than that of Chief Financial
Officer and is willing to agree not to compete with the Company;
NOW, THEREFORE, in consideration of the premises, the parties hereto covenant and agree as follows:
Section 1. Term of Employment; Compensation. The Company agrees to employ Executive from the date hereof
until December 31, 1999 (the "Term") as its Chief Financial Officer, with the responsibilities normally associated
with such position (the "Executive Position"). The Company will pay Executive for his services during the term of
his employment hereunder at an annual rate of Two Hundred Thousand Dollars ($200,000), subject to a 15%
increase per year, payable in arrears, in equal installments, in accordance with standard Company practice, but in
any event not less often than monthly, subject only to such payroll and withholding deductions as are required by
law.
Section 2. Office and Duties. Executive shall have the usual duties, responsibilities and authority (the "Executive's
Authority") of a Chief Financial Officer, and shall report to the Board of Directors of the Company, and shall
perform such specific other tasks, consistent with his position as Chief Financial Officer, as may from time to time
be