Amendment No. 1 to Employment Agreement
EXHIBIT
10.2
Amendment
No. 1 to Employment Agreement
Amendment
No. 1 dated December 17, 2007 to the Employment Agreement dated May 2, 2005
(the
“Agreement”) by and between Advanced Photonix, Inc., a Delaware corporation (the
“Company”) and Xxxxx Xxxxxx, an individual (the “Employee”). The Company and
Employee wish to amend the Employment Agreement in order to conform to, and
be
interpreted to comply with, Section 409A of the Internal Revenue Code of 1986,
as may be amended (the “Code”). Unless otherwise defined herein, capitalized
terms shall have the respective meanings assigned to them in the Agreement.
1.
Section
E
of the Agreement is amended by deleting the following
sentence:
“In
the
event of a separation of Employee from the Company, all accrued vacation shall
be paid at the then pro-rata hourly base rate of Employee in accordance with
the
Company’s regular procedures and practices in effect from time to
time.”
Section
E
of the Agreement shall be further amended by adding the following sentence
to
the end of such Section:
“The
bonus payable to Employee pursuant to this Section shall be paid to Employee
as
soon as practicable but within two and a half months following the Company’s
fiscal year end for the year in which such bonus was earned.”
2. Section
G
of the Agreement is deleted in its entirety and replaced with the following:
“Death;
Disability.
Employee’s employment shall terminate immediately upon the Employee’s death and
upon notice of termination by the Company in the event Employee’s employment is
terminated as a result of Employee’s Disability (as defined in Section L). Upon
any such termination of employment, all payments hereunder shall cease as of
the
date of termination of employment and the Company shall have no further
obligations or liabilities hereunder to Employee or Employee’s estate or legal
representative or otherwise, provided however, that any salary or benefits
accrued and unpaid as of the date of termination (including amounts payable
with
respect to accrued but unused vacation and sick days) shall be paid to Employee
or Employee’s estate, or legal representative or otherwise, as appropriate,
within 60 days after the date of such termination of employment.”
3. Section
L
shall be amended by deleting the last paragraph of this Section and replacing
it
with the following paragraphs:
“In
the
event Employee’s employment is terminated by
the
Company for Cause, the Company’s obligations under this Agreement will terminate
and the Company will have no obligations to make any additional payments of
any
kind, provided, however, that the Company shall pay Employee any accrued and
unpaid salary payable to the Employee through the date of termination (including
amounts payable with respect to accrued but unused vacation and sick days)
(the
“Accrued Obligations”) in a lump sum payment within 60 days after the date of
such termination of employment.”
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In
the
event of a termination of Employee’s employment by the Company without Cause or
by Employee for Good Reason (a ‘Separation from Service’),
the
Company shall pay Employee a lump sum payment equal to any Accrued Obligations
plus a severance payment equal to his Base Pay for the balance of the then
remaining Employment Term within 90 days
after the date of the Separation from Service (the ‘Payment Date’) and shall
continue to provide medical, dental, life insurance, disability and similar
benefits to the extent available to Employee as of the date of the Separation
from Service through the remainder of the Employment Term, provided that
Employee and the Company shall have executed a reciprocal release in such form
as may be reasonably required by the Company and acceptable to Employee within
60 days after the date of the Separation from Service. In the event such release
is not executed by Employee on or prior to 60 days after the date of Employee’s
Separation from Service, the Company shall have no obligation to make any
additional payments or provide any benefits to Employee of any kind, except
for
the lump sum payment for any Accrued Obligations. With respect to the provision
of benefits pursuant to this paragraph, the provision of benefits in kind to
Employee or the provision of reimbursement to Employee therefore shall be
subject to the following conditions: (i) the amount of expenses eligible for
reimbursement or in-kind benefits provided during Employee’s taxable year may
not affect the expenses eligible for reimbursement or in-kind benefits to be
provided to Employee in any other taxable year; (ii) the reimbursement of an
eligible expense must be made on or before the last day of Employee’s taxable
year following the taxable year in which the expense was incurred; and (iii)
the
right to reimbursement or in-kind benefits may not be subject to liquidation
or
exchange for another benefit. Notwithstanding anything to the contrary in this
paragraph, if as of the date of such Separation from Service, Employee is a
‘specified employee’ within the meaning of Section 409A of the Code, the
payments and benefits which may be made or provided to Employee pursuant to
this
paragraph prior to the date which is six months and one day after the date
of
Employee’s Separation from Service shall be limited to (i) any Accrued
Obligations plus (ii) the medical and dental benefits, if any, to be provided
in
accordance with this paragraph plus (iii) such benefits (to be selected by
the
Employee from the benefits to be provided under this paragraph) in an aggregate
amount not to exceed the amount described in Section 402(g)(1)(B) of the Code
for the calendar year in which the Separation from Service occurred. To the
extent that the preceding provisions of this paragraph would require payment
to
Employee during the six month period commencing on the date of termination
in
excess of this limitation, then any such excess shall be paid to Employee
(without interest) in a lump sum on the date that is six months plus one day
after the date of Employee’s Separation from Service.”
Except
as
modified herein, the Agreement remains in full force and effect in accordance
with its terms.
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ADVANCED
PHOTONIX, INC.
|
EMPLOYEE
|
||||
By:
|
/s/Xxxxxxx
X. Xxxxx
|
/s/Xxxxx
Xxxxxx
|
|||
Xxxxxxx
X. Xxxxx, CEO
|
Xxxxx Xxxxxx, CFO |
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