EXHIBIT 10.1

 

March 13, 2013

 

Mr. Charles P. Dougherty
1471 Parsons Lane
Lower Gwynedd, PA 19002

 

Dear Mr. Dougherty:

 

We are pleased to offer you (“the Executive”) the position of President and
Chief Executive Officer of American Science and Engineering, Inc. (“the
Company”) on the following terms:

 

1.                                      Start Date.

 

The Executive shall commence his employment with the Company on April 8, 2013.

 

2.                                      Duties.

 

The Executive will be the President and Chief Executive Officer of the Company
and shall report to the Company’s board of directors.

 

3.                                      Member, Board of Directors.

 

The Executive shall, promptly after commencement of his employment with the
Company, be appointed to the Company’s board of directors and, so long as he is
the Company’s Chief Executive Officer, shall be nominated by the board of
directors for election to the Company’s board of directors at the applicable
meetings of the Company’s stockholders.  Executive shall resign as a director at
such time as he ceases to be the Company’s Chief Executive Officer, for any
reason.

 

4.                                      Compensation.

 

4.1                               Base.

 

Executive’s base compensation (“Base Compensation”) shall be at the annual rate
of FIVE HUNDRED-FIFTY THOUSAND ($550,000.00) DOLLARS, subject to withholding
taxes required by law or authorized by the Executive and payable in accordance
with the Company’s regular payroll practices.  Such Base Compensation may be
increased (but not decreased) by the Company’s board of directors from time to
time in its sole discretion.

 

4.2                               Performance-Based Annual Incentive
Compensation Plan (“STIP”)

 

Beginning with the Company’s fiscal year starting April 1, 2013, the Executive
shall be entitled to participate in the Company’s performance-based annual
incentive compensation plan for the Company’s senior executives with a target
bonus (“Target Bonus”) equal to 100% of his Base Compensation for the applicable
fiscal year of the Company.  The plan requires that the Company achieve a
predetermined threshold level of financial performance before any bonus is
paid.  If the Company does not have such a plan for any of the Company’s fiscal
years during which the Executive is employed, the Company will provide a similar
individual plan for the Executive. The Target Bonus for FY2014 shall be
guaranteed, provided that the Executive remains employed through March 31, 2014.

 

--------------------------------------------------------------------------------

 

4.3                               Performance and Time-Based Long Term Incentive
Program (“LTIP”).

 

The Executive shall be entitled to initial incentive awards equal to 200% of
Base Compensation as measured from the initial date of the award, upon
achievement of long-term strategic goals that are designed to increase long-term
stockholder value.  Awards may be comprised of restricted stock, stock options
and/or cash as determined by the Compensation Committee.  Goals are designed as
Company performance objectives that are expected to be achievable in the average
three-year time frame but may vest sooner as specific predetermined goals are
met.  The Compensation Committee will consider additional LTIP awards in future
years.

 

5.                                      Relocation Compensation.

 

The Executive shall receive reasonable and actual costs associated with the
Executive’s relocation to the Boston area which shall include the following:

 

a.              Travel expenses between Boston and the Executive’s non-Boston
residence or residences for the Executive and his spouse during the first 12
months of Executive’s employment but not to exceed the cumulative total amount
of Fifteen Thousand ($15,000.00) dollars, of which up to Eleven Thousand Two
Hundred Fifty ($11,250.00) dollars may be used in 2013 and up to Three Thousand
Seven Hundred Fifty ($3,750.00) dollars may be used in 2014.

 

b.              Moving and temporary storage of household goods.

 

c.               Temporary living costs.

 

d.              Tax gross up for any of the aforementioned components that are
taxable income, with the gross up to be paid no later than the date required for
compliance with Section 409A of the Internal Revenue Code of 1986, as amended.

 

6.                                      Vacations; Other Benefits.

 

6.1                               Vacations.

 

During the term hereof, the Executive shall be entitled to earn vacation at the
rate of five (5) weeks per calendar year, to be taken at such times and
intervals as shall be determined by the Executive, subject to the reasonable
business needs of the Company.  Vacation shall otherwise be governed by the
policies of the Company, as in effect from time to time.

 

6.2                               Other Benefits.

 

During the term hereof, the Executive shall be entitled to participate in any
and all employee benefit plans from time to time in effect for employees of the
Company generally, including but not limited to medical, dental, long-term
disability and life insurance and a 401(k) plan, and on a basis at least as
favorable as benefits to other senior-level executives of the Company.

 

7.                                      Termination of Employment.

 

On the date of his commencement of employment with the Company, the Company and
the Executive shall enter into the attached “Change in Control & Severance
Benefit Agreement” (the “CiC Agreement”).  Executive’s employment termination
and severance shall be governed by the CiC Agreement, as it may be amended or
replaced from time to time.

 

8.                                      No Conflicts.

 

The Executive represents and warrants to the Company that he is not a party to
any agreement(s) with his former employers, or any other agreement, that would
restrict or limit his ability to perform his

 

--------------------------------------------------------------------------------

 

duties under this letter agreement and the normal duties of the Chief Executive
Officer of the Company.  The Executive will provide the Company, within three
(3) days after the date hereof, a copy of each agreement between him and his
most recent former employer and, if still in effect, any agreement between him
and any prior employer.

 

9.                                      Confidential Information, etc.

 

The Executive and the Company will, at the commencement of his employment with
the Company, execute and deliver to the Company its standard Employee,
Representation, Rights in Data, and Non-Compete Agreement regarding confidential
information, assignment of rights to intellectual property, and non-competition,
a copy of which accompanies this letter agreement.

 

10.                               Indemnification, etc.

 

The Executive and the Company shall, at the commencement of Executive’s
employment with the Company, enter into an agreement providing indemnification
to the Executive in the form currently extended by the Company to its directors
and executive officers.  The Executive shall also be covered by such director’s
and officer’s liability insurance coverage (if any) as the Company may provide
to its directors and executive officers from time to time.

 

11.                               Arbitration.

 

In a dispute arising out of, or related to, the Executive’s employment by the
Company or his position as a director of the Company, shall be submitted to
binding arbitration in accordance with the rules and procedures of the
Employment Dispute Resolution Rules of the American Arbitration Association then
in effect, such arbitration to occur in Boston, Massachusetts.  The decision of
the arbitrator shall be final and binding on both parties in any court of
competent jurisdiction may enter judgment upon the award.

 

12.                               Assignment.

 

This letter agreement may not be assigned by the Executive and may only by
assigned by the Company in connection with a Change in Control as defined in the
CiC Agreement.

 

13.                               Other.

 

13.1                        Because the Company’s work is subject to government
regulations, all employees are required to provide proof of citizenship.
Therefore Executive will need to bring a Passport, Birth Certificate or a
Naturalization Certificate with him to his new employee orientation on his first
day.

 

13.2                        AS&E is an Equal Opportunity and Affirmative Action
Employer. If Executive is an individual with a disability or he is a veteran and
would like the Company to be aware of his status, he may complete the enclosed
Voluntary Status Disclosure form and return it to the Human Resources
Department.

 

14.                               Expiration of Offer.

 

In the event that the Executive has not acknowledged acceptance of this offer on
or before March 14, 2013 at 5:00 PM (Eastern Standard Time), this offer shall be
null and void unless extended by the Company in writing.

 

--------------------------------------------------------------------------------

 

*   *   *

 

Please sign below to indicate your acceptance of this offer.

 

 

 

Sincerely,

 

 

 

 

 

 

 

 

AMERICAN SCIENCE AND ENGINEERING, INC.

 

 

 

 

 

 

 

 

By:

/s/DR Brown

 

 

 

Denis Brown

 

 

 

Chairman

ACCEPTED AND AGREED TO:

 

 

3/13/13

 

 

 

/s/Charles P. Dougherty

 

 

Charles P. Dougherty

 

 

 

 

 

Date:

3/13/13

 

 

 

--------------------------------------------------------------------------------