Exhibit 10.1

PERCEPTRON, INC.
 
SEVERANCE AGREEMENT
 
THIS SEVERANCE AGREEMENT, dated as of June 12, 2007, is between Perceptron, Inc.
(the “Company”) and John H. Lowry III, who will be employed by the Company in
the position of Vice President - Finance, Chief Financial Officer, Treasurer and
Assistant Secretary (the “Executive”) effective June 25, 2007.
 
1.  Operation of Agreement. This Agreement sets forth the severance compensation
that the Company shall pay the Executive if the Executive’s employment with the
Company terminates under one of the applicable provisions set forth herein. As
used in this Agreement, employment with the Company shall be deemed to include
employment with a subsidiary of the Company.
 
2.  Defined Terms. For purposes of this Agreement, the following terms shall
have the meanings set forth below:
 
(a)  “Cause” shall mean the Executive’s
 
(i)  personal dishonesty in connection with the performance of services for the
Company,
 
(ii)  willful misconduct in connection with the performance of services for the
Company,
 
(iii)  conviction for violation of any law involving (A) imprisonment that
interferes with performance of duties or (B) moral turpitude.
 
(iv)  repeated and intentional failure to perform stated duties, after written
notice is delivered identifying the failure, and it is not cured within 10 days
following receipt of such notice, or
 
(v)  breach of a fiduciary duty to the Company.
 
(b)  “Change in Control” shall be deemed to have occurred upon the occurrence of
any of the following events:
 
(i)  A merger involving the Company in which the Company is not the surviving
corporation (other than a merger with a wholly-owned subsidiary of the Company
formed for the purpose of changing the Company’s corporate domicile);
 
(ii)  A share exchange in which the shareholders of the Company exchange their
stock in the Company for stock of another corporation (other than a share
exchange in which all or substantially all of the holders of the voting stock of
the Company, immediately prior to the transaction, exchange, on a pro rata
basis, their voting stock of the Company, for more than 50% of the voting stock
of such other corporation);
 
 
 

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(iii)  A sale of all or substantially all of the assets of the Company; or
 
(iv)  Any person or group of persons (as defined in Section 13(d) of the
Securities Exchange Act of 1934, as amended) (other than any employee benefit
plan or employee benefit trust benefiting the employees of the Company) becoming
a beneficial owner, directly or indirectly, of securities of the Company
representing more than 50% of either the then outstanding Common Stock of the
Company, or the combined voting power of the Company’s then outstanding voting
securities.
 
(c)  “Disability” shall mean the Executive’s inability to substantially perform
the Executive’s duties for such period as would qualify the Executive for
benefits under the long-term disability insurance policy provided by the Company
or, if no such policy is provided, the Executive’s total and permanent
disability which prevents the Executive from performing for a continuous period
exceeding six months the duties assigned to the Executive. The determination of
Disability shall be made by a medical board-certified physician mutually
acceptable to the Company and the Executive (or the Executive’s legal
representative, if one has been appointed), and if the parties cannot mutually
agree to the selection of a physician, then each party shall select such a
physician and the two physicians so selected shall select a third physician who
shall make this determination.
 
3.  Termination of Employment. The Executive shall be entitled to the Regular
Severance Benefits (as defined in Section 3(b) below) set forth in this Section
3 if the Executive has incurred a Termination of Employment. The severance
benefit provided under this Section 3 is in lieu of cash severance payments
offered under the Company’s documented severance policy, if any.
 
(a)  For purposes of Section 3 of the Agreement, “Termination of Employment”
shall be defined as the Executive’s involuntary termination by the Company for
any reason other than death, Disability or Cause.
 
(b)  Upon satisfaction of the requirements set forth in this Section 3, upon the
Executive’s execution of a release (in the form attached hereto as Exhibit A),
the Executive shall be entitled to (the “Regular Severance Benefits”):
 
(i)  A cash severance benefit equal to one-half the Executive’s current annual
base salary, as in effect at the time of the Termination of Employment;
 
(ii)  A prorated portion of any bonus that the Executive would have earned for
the year of termination had the Executive been employed by the Company at the
end of the applicable bonus period;
 
(iii)  Subject to Section 6, continuation of Company-provided health (including
vision and dental, if provided by the Company at the date of termination) and
welfare benefits (including executive life insurance coverage, if provided by
the Company to the Executive at the date of termination) for six months, on the
terms (or comparable terms) provided by the Company to its employees from time
to time during this period. Health benefits shall be provided through continued
coverage under the Company’s group health plan, if allowed under the terms of
such plan, or by the reimbursement of COBRA continuation coverage premiums paid
by the Executive, as determined by the Company; provided, however, if the health
plan is self-insured by the Company, then the determination shall be made by the
Executive. Any continuation of group health plan coverage under this paragraph
shall run concurrently with the period of required COBRA continuation coverage
under the Code. If COBRA continuation coverage is not available, the Company
shall reimburse the Executive for premiums for comparable coverage, provided,
however, that the reimbursement shall not exceed the greater of (i) two times
the annual premium paid by the Company for such coverage at the date of
termination or (ii) two times the then current amount of the COBRA premium under
the Company’s group health plan for coverage comparable to that elected by the
Executive. Welfare benefits (other than health benefits) shall be continued only
to the extent permitted under the terms of such plans;
 
 
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(iv)  Continuation of the Executive’s then current car benefit for six months in
accordance with the Company car policy in effect at the time of termination.
 
(c)  The Executive’s cash severance benefit under Section 3(b)(i) shall be
payable in the same manner as the Executive’s base salary and the pro rata share
of any bonus under Section 3(b)(ii) shall be payable at the time set forth in
the bonus program, or, in each case, such earlier time as is required to avoid
such payments being subject to Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”).
 
4.  Termination of Employment Following a Change in Control. Subject to Section
11(a) hereunder, the Executive shall be entitled to the Change in Control
Severance Benefits (as defined in Section 4(c) below) set forth in this Section
4, in lieu of the severance benefits the Executive is entitled to under Section
3 of this Agreement, if there has been a Change in Control and the Executive has
incurred a Termination of Employment. The severance benefit provided under this
Section 4 is in lieu of cash severance payments offered under the Company’s
documented severance policy, if any.
 
(a)  For purposes of Section 4 of the Agreement, “Termination of Employment”
shall be defined as:
 
(i)  The Executive’s involuntary termination by the Company for any reason other
than death, Disability or Cause; or
 
(ii)  The Executive’s termination for “Good Reason,” defined as the occurrence
of any of the following events without the Executive’s written consent, if the
Executive terminates employment within one (1) year following the occurrence of
such event:
 
(A)  Any reassignment of the Executive to substantial duties materially
inconsistent with the Executive’s position, duties, responsibilities and status
with the Company immediately prior to the Change in Control or a substantial
diminution in the Executive’s position, duties, responsibilities or status with
the Company from his position, duties, responsibilities or status with the
Company immediately prior to the Change in Control; provided that the fact that
the Company is no longer a publicly traded company or the Executive no longer
has duties and responsibilities associated exclusively with a publicly traded
company, such as Securities and Exchange Commission or stock exchange reporting
responsibilities or investor or analyst relations responsibilities, shall not be
deemed to be a reassignment of the Executive to substantial duties materially
inconsistent with the Executive’s position, duties, responsibilities and status
with the Company immediately prior to the Change in Control or a substantial
diminution in the Executive’s position, duties, responsibilities or status with
the Company from his position, duties, responsibilities or status with the
Company immediately prior to the Change in Control;
 
 
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(B)  Any reduction in the Executive’s base salary or targeted incentive bonus or
commissions in effect immediately prior to the Change in Control, or failure by
the Company to continue any bonus, stock or other incentive plans in effect
immediately prior to the Change in Control (without the implementation of
comparable successor plans that provide comparable award
opportunities/benefits), or any removal of the Executive from participation in
such aforementioned plans;
 
(C)  The discontinuance or reduction in benefits to the Executive under any
qualified or nonqualified retirement or welfare plan maintained by the Company
immediately prior to the Change in Control (without the implementation of
comparable successor plans that provide comparable benefits), or the
discontinuance of any fringe benefits or other perquisites that the Executive
received immediately prior to the Change in Control (without the implementation
of comparable successor plans that provide comparable benefits);
 
(D)  Required relocation of the Executive’s principal place of employment more
than 50 miles from the Executive’s place of employment prior to the Change in
Control; or
 
(E)  The Company’s breach of any provision in this Agreement, provided that the
Company has not cured such breach within 10 days following written notice by the
Executive to the Company of such breach.
 
(b)  The Executive who believes the Executive is entitled to a Termination of
Employment for Good Reason, as defined in Section 4 above, may apply in writing
to the Company for confirmation of such entitlement prior to the Executive’s
actual separation from employment, by following the claims procedure set forth
in Section 15 hereof. The submission of such a request by the Executive shall
not constitute “Cause” for the Company to terminate the Executive as defined
under Section 2(a) hereof. If the Executive’s request for a Good Reason
Termination of Employment is denied under both the request and appeal procedures
set forth in paragraphs (b) and (c) of Section 15 hereof, then the parties shall
use their best efforts to resolve the claim within 90 days after the claim is
submitted to arbitration pursuant to Section 15(d).
 
(c)  Upon satisfaction of the requirements set forth in Sections 4 or 11(a)
hereof and with respect to any one or more Changes in Control that may occur
during the term of this Agreement, upon the Executive’s execution of a release
(in the form attached hereto as Exhibit A), the Executive shall be entitled to
(the “Change in Control Severance Benefits”):
 
 
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(i)  A cash severance benefit equal to one times the Executive’s current annual
base salary, as in effect at the time of the Change in Control;
 
(ii)  A prorated portion of the Executive’s target bonus for the year of
termination, based on the number of days worked in the year of termination;
 
(iii)  Subject to Section 6, continuation of Company-provided health (including
vision and dental, if provided by the Company immediately prior to the Change in
Control) and welfare benefits (including executive life insurance coverage, if
provided by the Company to the Executive immediately prior to the Change in
Control) for one year, on the terms (or comparable terms) provided by the
Company to the Executive immediately prior to the Change in Control. Health
benefits shall be provided through continued coverage under the Company’s group
health plan, if allowed under the terms of such plan, or by the reimbursement of
COBRA continuation coverage premiums paid by the Executive, as determined by the
Company; provided, however, if the health plan is self-insured by the Company,
then the determination shall be made by the Executive. Any continuation of group
health plan coverage under this paragraph shall run concurrently with the period
of required COBRA continuation coverage under the Code. If COBRA continuation
coverage is not available, the Company shall reimburse the Executive for
premiums for comparable coverage, provided, however, that the reimbursement
shall not exceed the greater of (i) two times the annual premium paid by the
Company for such coverage at the date of termination or (ii) two times the
amount of the COBRA premium under the Company’s group health plan for coverage
comparable to that elected by the Executive, (A) at the time of the Change of
Control or (B) at the time of the required payment, whichever is greater.
Welfare benefits (other than health benefits) shall be continued only to the
extent permitted under the terms of such plans;
 
(iv)  Continuation of the Executive’s then current car benefit for one year in
accordance with the Company car policy in effect at the time of termination.
 
(v)  Continued coverage, during the six (6) years following the Executive’s
termination for his actions or omissions as an officer and, if applicable,
director of the Company prior to the date of termination of his employment,
under any directors and officers liability insurance policy maintained by the
Company (or, if the Company does not maintain such a policy, by its affiliates)
for its former directors and officers or, at the Company’s election, for the
current directors and officers. If the Company or its affiliates does not
otherwise maintain such a policy, then the Company shall be required to provide
the Executive with such a policy, to the extent available. The policy dollar
coverage limits of any such policy shall be not less than the policy limit under
any Company policy in place within the one (1) year prior to the Executive’s
termination of employment (the “Existing Policy”) or, if less, the policy dollar
coverage limit that can be purchased by the Company for all of its current and
former directors and officers at an annual premium equal to two times the
Company’s annual premium for the Existing Policy.
 
 
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(d)  Subject to Section 11(a) hereof, the Executive’s cash severance benefit
under Section 4(c)(i) and (ii) shall be paid in a lump sum cash payment within
ten (10) days following the Executive’s Termination of Employment, as defined in
Section 4. Any payment made later than 10 days following the Executive’s
Termination of Employment (or applicable due date under Section 11(a) hereof)
for whatever reason, shall include interest at the prime rate plus two percent,
which shall begin accruing on the 10th day following the Executive’s Termination
of Employment (or applicable due date under Section 11(a) hereof). For purposes
of this Section 4, “prime rate” shall be determined by reference to the prime
rate established by Comerica Bank (or its successor), in effect from time to
time commencing on the 10th day following the Executive’s Termination of
Employment (or applicable due date under Section 11(a) hereof).
 
(e)  Section 4 of this Agreement shall terminate upon the first of the following
events to occur:
 
(i)  Three years from the date hereof if a Change in Control has not occurred
within such three-year period;
 
(ii)  Termination of the Executive’s employment with the Company prior to a
Change in Control, provided, however, if there is a Change in Control within six
months after the termination of the Executive’s employment with the Company,
other than a termination due to the Executive’s death or Disability, an
involuntary termination by the Company for Cause or a termination of employment
by the Executive, then the Agreement shall not be deemed to have terminated and
the Executive shall be entitled to receive the Change in Control Severance
Benefits provided in Section 4, less any Regular Severance Benefits the
Executive has been paid under Section 3, in lieu of the severance benefits the
Executive is entitled to under Section 3;
 
(iii)  The expiration of two years following a Change in Control;
 
(iv)  Termination of the Executive’s employment with the Company following a
Change in Control due to the Executive’s death or Disability;
 
(v)  Termination of the Executive’s employment by the Company for Cause
following a Change in Control; or
 
(vi)  Termination of employment by the Executive for other than Good Reason
following the date of a Change in Control.
 
Unless Section 4 of this Agreement has first terminated under clauses (ii)
through (vi) hereof, commencing on the third anniversary of the date of this
Agreement, and on each one-year anniversary thereafter, Section 4 of this
Agreement shall be extended for one additional year, unless at least 180 days
prior to any such anniversary, the Company notifies the Executive in writing
that it shall not extend the term of Section 4 of this Agreement.
 
 
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5.  Golden Parachute Limit. Payments under this Agreement, when aggregated with
any other “golden parachute” amounts (defined under Section 280G of the Code) as
compensation that becomes payable or accelerated due to a Change in Control)
payable under this Agreement or any other plans, agreements or policies of the
Company, shall not exceed to the golden parachute cap under Sections 280G and
4999 of the Code.
 
6.  No Mitigation or Duty to Seek Reemployment. The Executive shall be under no
duty or obligation to seek or accept other employment after Termination of
Employment and shall not be required to mitigate the amount of any payments
provided for by this Agreement by seeking employment or otherwise. The Regular
Severance Benefit and Change in Control Severance Benefits payments shall not be
reduced or suspended if the Executive accepts other employment, except that
Company is not required to continue any health or welfare benefit payments which
duplicate employee benefits and perquisites received in such other employment.
 
7.  Pro Rata Share of Bonus. For purposes of this Agreement, a pro rata share of
any bonus or target bonus shall mean the total bonus or target bonus payable
multiplied by a fraction, the numerator of which is the number of days in the
applicable bonus period prior to the date of the Executive’s Termination of
Employment, Disability or death and the denominator of which is the number of
days in the bonus period.
 
8.  Stock Options. The Executive’s rights with respect to any options to
purchase Company stock shall be governed by the terms of the agreements pursuant
to which such options were issued.
 
9.  Non-Competition and Restrictive Covenant. If, during the term that the
Executive is receiving benefits under this Agreement, Executive violates the
terms of this Agreement or the Perceptron Executive Agreement Not to Compete (as
defined below) or any other non-competition agreement with the Company, the
Company’s obligations to the Executive under this Agreement shall automatically
terminate.
 
10.  Tax Withholding. The Company may withhold from any cash amounts payable to
the Executive under this Agreement to satisfy all applicable Federal, State,
local or other income (including excise) and employment withholding taxes. In
the event the Company fails to withhold such sums for any reason, or withholding
is required for any non-cash payments provided in connection with the
Executive’s Termination of Employment, the Company may require the Executive to
promptly remit to the Company sufficient cash to satisfy all applicable income
and employment withholding taxes.
 
11.  Binding Effect.
 
(a)  This Agreement shall be binding upon the successors and assigns of the
Company. The Company shall take whatever actions are necessary to ensure that
any successor to its operations (whether by purchase, merger, consolidation,
sale of substantially all assets or otherwise) assumes the obligations under
this Agreement and shall cause such successor to evidence the assumption of such
obligations in an agreement satisfactory to the Executive. Notwithstanding any
other provisions in this Agreement, if the Company fails to obtain an agreement
evidencing the assumption of the Company’s obligations by any such successor,
the Executive shall be entitled to immediate payment of the severance
compensation provided under Section 4, irrespective of whether the Executive’s
employment has then terminated. For purposes of implementing the foregoing, the
date on which any succession becomes effective shall be deemed to constitute the
date of the Executive’s Termination of Employment.
 
 
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(b)  This Agreement shall be binding upon the Executive and shall inure to the
benefit of and be enforceable by the Executive’s legal representatives and
heirs. However, the rights of the Executive under this Agreement shall not be
assigned, transferred, pledged, hypothecated or otherwise encumbered, except by
operation of law.
 
12.  Amendment of Agreement. This Agreement may not be modified or amended
except by instrument in writing signed by the parties hereto. The parties agree
that this Agreement may be amended to comply with applicable law, including, but
not limited to, Code Section 409A.
 
13.  Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall continue in full force and effect.
 
14.  Limitation on Rights.
 
(a)  This Agreement shall not be deemed to create a contract of employment
between the Company and the Executive and shall create no right in the Executive
to continue in the Company’s employment for any specific period of time, or to
create any other rights in the Executive or obligations on the part of the
Company, except as set forth herein. This Agreement shall not restrict the right
of the Company to terminate the Executive, or restrict the right of the
Executive to terminate employment.
 
(b)  Subject to the exception for cash severance payments under the Company’s
documented severance policy referenced in Sections 3 and 4 above, this Agreement
shall not be construed to exclude the Executive from participation in any other
compensation or benefit programs in which the Executive is specifically eligible
to participate either prior to or following the execution of this Agreement, or
any such programs that generally are available to other executive personnel of
the Company, nor shall it affect the kind and amount of other compensation to
which the Executive is entitled.
 
(c)  The rights of the Executive under this Agreement shall be solely those of
an unsecured general creditor of the Company.
 
15.  Claims Procedure.
 
(a)  The administrator for purposes of this Agreement shall be the Company
(“Administrator”), whose address is 47827 Halyard Drive, Plymouth, Michigan
48170, and whose telephone number is (734) 414-6100. The “Named Fiduciary” as
defined in Section 402(a)(2) of ERISA, also shall be the Company. The Company
shall have the right to designate one or more Company employees as the
Administrator and the Named Fiduciary at any time, and to change the address and
telephone number of the same. The Company shall give the Executive written
notice of any change in the Administrator and Named Fiduciary, or in the address
or telephone number of the same.
 
 
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(b)  The Administrator shall make all determinations as to the right of any
person to receive benefits under the Agreement. Any denial by the Administrator
of a claim for benefits by the Executive (“the claimant”) shall be stated in
writing by the Administrator and delivered or mailed to the claimant within 10
days after receipt of the claim, unless special circumstances require an
extension of time for processing the claim. If such an extension is required,
written notice of the extension shall be furnished to the claimant prior to the
termination of the initial 10-day period. In no event shall such extension
exceed a period of 10 days from the end of the initial period. Any notice of
denial shall set forth the specific reasons for the denial, specific reference
to pertinent provisions of this Agreement upon which the denial is based, a
description of any additional material or information necessary for the claimant
to perfect the claim, with an explanation of why such material or information is
necessary, and any explanation of claim review procedures, written to the best
of the Administrator’s ability in a manner that may be understood without legal
or actuarial counsel.
 
(c)  A claimant whose claim for benefits has been wholly or partially denied by
the Administrator may request, within 60 days following the date of such denial,
in a writing addressed to the Administrator, a review of such denial. The
claimant shall be entitled to submit such issues or comments in writing or
otherwise, as the claimant shall consider relevant to a determination of the
claim, and the claimant may include a request for a hearing in person before the
Administrator. Prior to submitting the request, the claimant shall be entitled
to review such documents as are pertinent to the claim. The claimant may, at all
stages of review, be represented by counsel, legal or otherwise, of the
claimant’s choice. All requests for review shall be promptly resolved. The
Administrator’s decision with respect to any such review shall be set forth in
writing and shall be mailed to the claimant not later than 10 days following
receipt by the Administrator of the claimant’s request unless special
circumstances, such as the need to hold a hearing, require an extension of time
for processing, in which case the Administrator’s decision shall be so mailed
not later than 20 days after receipt of such request.
 
(d)  A claimant who has followed the procedure in paragraphs (b) and (c) of this
Section, but who has not obtained full relief on the claim for benefits, may,
within 60 days following the claimant’s receipt of the Administrator’s written
decision on review, apply in writing to the Administrator for binding
arbitration of the claim before an arbitrator mutually acceptable to both
parties, the arbitration to be held in Plymouth, Michigan, in accordance with
the arbitration rules of the American Arbitration Association, Commercial
Disputes Resolution Procedures, as then in effect. If the parties are unable to
mutually agree upon an arbitrator, then the arbitration proceedings shall be
held before three arbitrators, one of which shall be designated by the Company,
one of which shall be designated by the claimant and the third of which shall be
designated mutually by the first two arbitrators in accordance with the
arbitration rules referenced above. The arbitrator(s) sole authority shall be to
interpret and apply the provisions of this Agreement; the arbitrator(s) shall
not change, add to, or subtract from, any of the Agreement’s provisions. The
arbitrator(s) shall have the power to compel attendance of witnesses at the
hearing. Any court having jurisdiction may enter a judgment based upon such
arbitration. All decisions of the arbitrator(s) shall be final and binding on
the claimant and the Company without appeal to any court. The Executive and the
Company hereby acknowledge that as arbitration is the exclusive remedy with
respect to any grievance hereunder, neither party has the right to resort to any
federal, state or local court or administrative agency concerning breaches of
this Agreement, and the decision of the arbitrator shall be a complete defense
to any suit, action or proceeding instituted in any federal, state or local
court or before any administrative agency with respect to any dispute which is
arbitrable as herein set forth.
 
 
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16.  Legal Fees and Expenses.
 
(a) Except as otherwise provided in Section 16(b), in the event any arbitration
or litigation is brought to enforce any provision of this Agreement and the
Executive prevails, then the Executive shall be entitled to recover from the
Company the Executive’s reasonable costs and reasonable expenses of such
arbitration or litigation, including reasonable fees and disbursements of
counsel (both at trial and in appellate proceedings), (“Expenses). Except as
otherwise provided in Section 16(b), if the Company prevails, then each party
shall be responsible for its/his respective costs, expenses and attorneys fees,
and the costs of the arbitrator shall be equally divided.

(b) Except to the extent prohibited by applicable law, in the event any
arbitration or litigation is brought to enforce any provision of Section 4 of
this Agreement, the Company shall advance to the Executive one half of the
amount of the Executive’s Expenses and shall pay the costs of the arbitrator.
The Executive shall be obligated to repay such advances to the Company only if
the Company prevails in the arbitration or litigation.

(c) In the event that it is determined that the Executive is entitled to
compensation, legal fees and expenses hereunder, the Executive also shall be
entitled to interest thereon, from the date payment thereof was due, payable to
the Executive at the prime rate of interest plus two percent.

(d) For purposes of this Section 16, “prevails” means that the Executive
receives an award of severance benefits in such arbitration or litigation in
excess of the amount offered to be paid by the Company to the Executive prior to
the initiation of the arbitration or litigation. For purposes of this Section
16, “prime rate” shall be determined by reference to the prime rate established
by Comerica Bank as in effect from time to time during the period from the date
such amounts should have been paid to the date of actual payment. For purposes
of determining the date when legal fees and expenses are payable, such amounts
are not due until 30 days after notification to the Company of such amounts.

17.  Nonalienation of Benefits. Except in so far as this provision may be
contrary to applicable law, no sale, transfer, alienation, assignment, pledge,
collateralization or attachment of any benefits under this Agreement shall be
valid or recognized by the Company.
 
18.  ERISA. This Agreement is an unfunded compensation arrangement for a member
of a select group of the Company’s management and any exemptions under ERISA, as
applicable to such an arrangement, shall be applicable to this Agreement.
 
19.  Reporting and Disclosure. The Company, from time to time, shall provide
government agencies with such reports concerning this Agreement as may be
required by law, and the Company shall provide the Executive with such
disclosure concerning this Agreement as may be required by law or as the Company
may deem appropriate.
 
 
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20.  Notices. Any notice required or permitted by this Agreement shall be in
writing, sent by registered or certified mail, return receipt requested,
addressed to the Board and the Company at the Company’s then principal office,
or to the Executive at the Executive’s last address on file with the Company, as
the case may be, or to such other address or addresses as any party hereto may
from time to time specify in writing for the purpose of this Agreement in a
notice given to the other parties in compliance with this section. Notices shall
be deemed given when received.
 
21.  Miscellaneous/Severability. A waiver of the breach of any term or condition
of this Agreement shall not be deemed to constitute a waiver of any subsequent
breach of the same or any other term or condition. This Agreement is intended to
be performed in accordance with, and only to the extent permitted by, all
applicable laws, ordinances, rules and regulations. To the extent that any
provision or benefit under this Agreement is not deemed to be in accordance with
any applicable law, ordinance, rule or regulation, the noncomplying provision
shall be construed, or benefit limited, to the extent necessary to comply with
all applicable laws, ordinances and regulations and any such provision or
benefit shall not affect the validity of any other provision or benefit provided
by this Agreement. The headings in this Agreement are inserted for convenience
of reference only and shall not be a part of or control or affect the meaning of
any provision hereof.
 
22.  Governing Law. To the extent not preempted by Federal law, this Agreement
shall be governed and construed in accordance with the laws of the State of
Michigan, without regard to its conflicts of law rules.
 
23.  Entire Agreement. This document represents the entire agreement and
understanding of the parties with respect to the subject matter of the Agreement
(other than the Perceptron Executive Agreement Not to Compete dated even date
herewith (“Perceptron Executive Agreement Not to Compete”) and the Company’s
Proprietary Information and Inventions Agreement, which shall remain in full
force and effect after the execution of this Agreement) and it may not be
altered or amended except by an agreement in writing that is executed by both
parties to this Agreement. Specifically, this Agreement supersedes any other
severance pay provisions in effect on the date of this Agreement.
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first written above.
 

       
PERCEPTRON, INC.
 
   
   
    By:   /s/ Alfred A. Pease  

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  Alfred A. Pease, President and Chief Executive Officer

         
   
   
    By:   /s/ John H. Lowry III  

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John H. Lowry III

 
 
 
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