Exhibit 10.2

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”), made as of the 22nd day of May, 2012,
by and between BREEZE-EASTERN CORPORATION, a corporation organized and existing
under the laws of the State of Delaware, with its principal place of business
located at 35 Melanie Lane, Whippany, New Jersey 07981 (hereinafter referred to
as the “Company”), and BRAD PEDERSEN, an individual residing at 9 Thornhill
Drive, Lumberton, New Jersey 08048 (hereinafter referred to as “Employee”).

WHEREAS, The Company wishes to employ Employee and Employee wishes to accept
such employment on the terms and conditions contained in this Agreement and the
parties desire to set forth the terms of such employment; and

WHEREAS, in the course of its business activities, the Company has invested and
will continue to invest substantial time, effort, money, and other resources in
the creation, development, maintenance and protection of Confidential
Information (as defined herein), as well as substantial and ongoing customer and
industry relationships, all of which permit the Company to gain a substantial
advantage in the marketplace and represent assets of great value to Company and
which may be disclosed to Employee in the course of Employee’s employment with
the Company; and

WHEREAS, in the course of its business activities, the Company has invested and
will continue to invest substantial time, effort, money, and other resources in
the creation, development, maintenance and protection of its workforce which
permits the Company to gain a substantial advantage in the marketplace and
represents an asset of great value to the Company; and

WHEREAS, Employee recognize the Company’s legitimate business interest in
protecting its Confidential Information as well as its substantial and ongoing
customer and industry relationships; and

WHEREAS, due to Employee’s desire to be employed by the Company, and the
Company’s desire to employ Employee, the Company and Employee agree to the
covenants and restrictions contained herein.

NOW, THEREFORE, in consideration of the facts, mutual promises and covenants
contained herein, and intending to be legally bound hereby, the Company and
Employee agree as follows:

1. Definitions. As used herein, the following terms shall have the meanings set
forth below unless the context otherwise requires:

(a) “Average Bonus” shall mean (a) in the case Employee has been employed long
enough to have received two or more annual Bonus payments from the Company, the
average of the two most recent annual Bonuses paid to Employee by the Company,
or (b), in the case Employee has received only one Bonus payment from the
Company, the amount of that Bonus.

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(b) “Business Activities” shall mean the business conducted by Company
including, but not limited to, designing, developing, manufacturing, selling,
marketing and distributing retrieval winches, cargo winches, aircraft cargo
cranes, static line retrieval systems, cargo hook systems, weapons loading and
handling systems (collectively, the “Company Products” all as may be more
particularly described in the Company’s most recent Annual Report on Form 10-K)
and all other activities in which Company is or becomes engaged.

(c) “Cause” shall include, but not be limited to, any one or more of the
following:

(i) A determination by the Board of Directors of the Company (the “Board”) in
its sole discretion of material misconduct or gross or willful neglect by
Employee of the duties that Employee is required to perform under the terms of
this Agreement;

(ii) a determination by the Board in its sole discretion that Employee has
performed an act constituting a felony, or a misdemeanor involving the property
or operations of the Company, or a crime involving moral turpitude, or the
commission of any other act or omission involving dishonesty or fraud;

(iii) a determination by the Board, in its sole discretion, of conduct by
Employee tending to bring the Company into public disgrace or disrepute;

(iv) a failure to cure Employee’s failure to perform his duties in a competent
manner as reasonably directed by the Board within 30 days after written notice
to Employee of such failure to perform; and

(v) an unauthorized disclosure by Employee of the Company’s Confidential
Information.

(d) “Chairman” shall mean the Chairman of the Board of the Company or his
designee.

(e) “Change in Control” shall be deemed to have occurred if (a) any person
(including any individual, firm, partnership or other entity) together with all
Affiliates and Associates (as defined under Rule 12b-2 of the General Rules and
Regulations promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) of such person, but excluding (i) a trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
any subsidiary of the Company, (ii) the Company or any subsidiary of the
Company, and (iii) Employee, together with all of Employee’s Affiliates and
Associates, is or becomes the Beneficial Owner (as defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of securities of
the Company representing more than 50% of the combined

 

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voting power of the Company’s then outstanding securities; (b) the stockholders
of the Company approve a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation that would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least 60% of the combined
voting power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (c) the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets to a person or persons totally
unrelated to Employee or to any of Employee’s Affiliates.

(f) “Company” shall mean the Company and all of its divisions, parents,
subsidiaries, affiliates and related entities, and all of its and their
respective successors and assigns.

(g) “Confidential Information” shall mean the information of the Company,
including, but not limited to, Inventions, proprietary information and business
matters or affairs (including, but not limited to, information relating to
inventions, disclosures, processes, systems, methods, formulas, designs,
patents, patent applications, materials, research activities and plans, business
proposals, product cost data, contracts, forms, information concerning
competitive strengths and weaknesses, promotional methods, customer lists,
customer and supplier account preferences and requirements, business plans and
strategies, procedures, sales and pricing information, production cost data,
advertising information, as well as information of a confidential or proprietary
nature received from customers, suppliers, contractors, joint ventures and other
collaborators), and computer programs, software and documents relating to any of
the foregoing, regardless of the form or medium contained or stored in
(including hard copy, electronic or digital form), as well as copies or multiple
versions of each. Such Confidential Information shall include, for purposes of
this Agreement, any such information not generally known by the trade or public,
even if such information has been disclosed to one or more third parties
pursuant to distribution agreements, joint research agreements, confidentiality
agreements, disclosure agreements or other agreements or collaborations entered
into by Company. For purposes of this Agreement, the definition of Confidential
Information applies equally to information acquired, learned, or disclosed prior
to, simultaneously with, or after the date of this Agreement.

(h) “Good Reason Resignation” means a resignation within twenty-four (24) months
of a Change in Control following (i) a material reduction in compensation and
benefits or (ii) a material reduction in responsibilities, or (iii) a change in
the location of the Company’s headquarters to a location more than fifty
(50) miles from Whippany, New Jersey.

(i) “Invention” shall mean inventions (including, but not limited to, new
contributions, concepts, ideas, developments, discoveries, processes,
procedures, formulas, methods, compositions, techniques, articles, machines, and
improvements), writings (including, but not limited to, computer programs,
manuals, reports, databases and other information, whether in hard copy,
electronic, digital or other form), and all related know-how.

 

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(j) “Subsequent Termination” shall mean a termination of Employee’s employment
within twenty-four (24) months of a Change in Control that is not voluntary or
is other than for Cause.

2. Employment. The Company hereby employs Employee as President and Chief
Executive Officer and Employee hereby accepts employment by the Company upon the
terms and conditions specified in this Agreement. The Company reserves the right
to modify Employee’s job responsibilities and duties in its sole discretion,
subject to the provisions of this Agreement.

3. Office and Duties.

(a) As the President and Chief Executive Office of the Company, Employee shall
render such services as are necessary and desirable to protect and advance the
best interests of Company, as determined from time to time by and under the
supervision of and in accordance with the policies and directives set by the
Board.

(b) For as long as Employee shall remain employed by the Company, Employee’s
entire working time, energy, skill and best efforts shall be devoted to the
performance of Employee’s duties hereunder in a manner which will faithfully,
diligently and ethically further the business and interests of the Company.

(c) Employee shall keep the Chairman informed of any significant developments or
special difficulties encountered in connection with the business affairs and
financial condition of the Company.

(d) Employee shall comply with all rules and regulations established from time
to time by the Company.

(e) The Company expects and Employee has agreed that over the first five
(5) years of employment, Employee will purchase shares of the Company’s common
stock in open market transactions at cost at the time of purchase of at least
one hundred seventy five thousand ($175,000) dollars. These purchases are in
addition to, and not a part of, any of the shares being offered to Employee by
the Company as a part of the “Bonus Plan” defined below in Subparagraph 5(b) or
the stock option described in Subparagraph 5(c).

(f) Employee has agreed, as a condition of his employment, to relocate his
principal residence within twelve (12) months of the commencement of employment
to a location that is within a forty-five (45) minute commute of the Company’s
current offices in Whippany, New Jersey. The Company will reimburse Employee for
documented reasonable and

 

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customary costs to include moving expenses, costs to sell Employee’s existing
residence and closing costs incurred in connection with the purchase of
Employee’s new residence. Employee and the Company will discuss means and
methods or reducing the tax implications of these benefits to Employee. The
Company will increase the sums paid to Employee pursuant to the foregoing
sentence by an amount calculated to satisfy the Employee’s tax payments solely
on account of the amounts paid by the Company as reimbursement to the Employee
in the foregoing sentence (the “Gross-Up Payment”). The Company also will
reimburse the Employee for the documented reasonable costs of temporary housing
(e.g., extended stay hotel or similar) in the vicinity of Whippany, New Jersey
for a period of up to six (6) months. In the event that Employee voluntarily
terminates his employment with the Company for any reason within (12) months of
relocation, all amounts reimbursed (including the Gross-Up Payment) must be
repaid to the Company within thirty (30) days of the effective date of the
termination of employment.

4. Term. Employee’s employment with the Company under the terms and conditions
of this Agreement is “at will” and shall begin on May 22, 2012 and shall
continue until terminated by the Board in the exercise of its sole, unfettered
and unreviewable discretion, subject to Employee’s right to severance pay and
compensation as set forth in this Agreement (the “Term of Employment”).

5. Compensation and Benefits.

(a) Subject to the terms hereof, for all services rendered by Employee to the
Company, Employee shall receive Base Compensation at the gross annual rate of
$350,000.00, payable in installments in accordance with the Company’s regular
payroll practices in effect from time to time; however, in no event shall said
installments be less frequently than monthly. The Base Compensation shall be
reviewed annually, to ascertain, in the sole discretion of the Board, whether
and to what extent, if any, the amount Employee’s Base Compensation should be
adjusted.

(b) Employee will participate in the Company’s Annual Management Incentive Bonus
Plan (“Bonus Plan”). Under the Bonus Plan, Employee’s annual incentive
compensation (“Bonus”) will be in the range of $0 to seventy percent (70%) of
Employee’s Base Compensation, depending on Employee’s performance, as evaluated
by the Incentive and Compensation Committee of the Board. The Bonus earned will
be determined based on achievement of mutually-agreed objectives, including
financial targets based on the Company’s annual budget as approved by the Board.
Subject to regulatory authority and availability of stock for distribution,
fifteen percent (15%) of each year’s annual Bonus will be paid in the form of
shares of the Company’s common stock. During the fiscal year ending March 31,
2013, Employee’s Bonus will be prorated for the portion of fiscal year that the
Employee is employed by the Company but will not be less than one hundred
sixty-four thousand ($164,000) dollars (the “Guaranteed Bonus”), and the Company
will accelerate payment of this guaranteed portion Employee within two weeks of
the first day of employment. In the event that Employee voluntarily terminates
Employee’s employment with the Company for any reason within twelve

 

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(12) months of Employee’s first day of employment, the Guaranteed Bonus amount
shall be repaid to the Company within thirty (30) days of the effective date of
the termination of Employee’s employment. If not repaid by Employee within such
thirty (30) day repayment period, it the Guaranteed Bonus repayment shall bear
interest at a rate of seven (7.00%) percent per annum from the thirtieth
(30th) day following the effective date of Employee’s termination until the date
of actual repayment.

(c) Upon commencement of employment with the Company Employee will be awarded
options to purchase four hundred thousand (400,000) shares of the Company’s
common stock at the closing price on the day preceding Employee’s first day of
employment. This option grant is the only grant of stock options or other equity
awards Employee will receive. Employee acknowledges that Employee will not
receive a series of annual grants of stock options, restricted shares or other
equity-related securities. Subject to the terms of the stock option award
agreement granted under the Plan, fifty thousand (50,000) options will vest
immediately upon commencement of Employee’s employment, and the remaining
options will vest in accordance with the following time and performance
triggers: (i) fifty thousand (50,000) options will vest when the average closing
price of the Company’s common stock for the preceding thirty (30) days (the
“Trailing Price”) exceeds eight dollars and fifty cents ($8.50); (ii) at any
time after the first anniversary of Employee’s employment, fifty thousand
(50,000) shares will vest when the Trailing Price exceeds nine dollars and fifty
cents ($9.50) and fifty thousand (50,000) shares will vest when the Trailing
Price exceeds ten dollars and fifty cents ($10.50); (iii) at any time after the
second anniversary of Employee’s employment, fifty thousand (50,000) shares will
vest when the Trailing Price exceeds eleven dollars and fifty cents ($11.50) and
fifty thousand (50,000) shares will vest when the Trailing Price exceeds twelve
dollars and fifty cents ($12.50); and (iv) at any time after the third
anniversary of Employee’s employment, fifty thousand (50,000) shares will vest
when the Trailing Price exceeds thirteen dollars and fifty cents ($13.50) and
fifty thousand (50,000) shares will vest when the Trailing Price exceeds
fourteen dollars and fifty cents ($14.50). Notwithstanding the foregoing, upon a
Change in Control all of the foregoing time frames would immediately accelerate,
such that the Employee’s stock options would remain subject to only the pricing
element for vesting purposes.

(d) Employee acknowledges and confirms that his employment and the other
protections and benefits of this Agreement are full, adequate and sufficient
consideration for the restrictions and obligations set forth in this Agreement.

(e) The compensation provided to Employee pursuant to this Agreement shall be
subject to all withholdings and deductions required by applicable law or by the
Company’s policy, practice or applicable plan.

6. Fringe Benefits. Employee shall be entitled to the benefits set forth below
(the “Fringe Benefits”) during the Term of Employment.

 

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(a) Employee shall be eligible to participate in any health, life, accident or
disability insurance, sick leave or other benefit plans or programs on the same
terms and conditions applicable to other similarly situated employees of the
Company, as long as the plans and programs are kept in force by the Company and
provided that Employee (and/or his qualified beneficiaries) meets the
eligibility requirements and other terms, conditions and restrictions of the
respective plans and programs. The premiums of the health insurance plan made
available to Employee will be on a shared cost basis. The premium and specified
percentage of the Company’s contribution will be determined by the Company’s
plans in effect, from time to time.

(b) Employee shall be entitled to four (4) weeks vacation per year. The Company
does not offer sabbaticals and the Employee will not be entitled to any
compensation for unused vacation. Employee shall also be entitled to a day off
on each holiday designated by the Company as a Company holiday.

(c) The Company shall reimburse Employee for all reasonable and necessary
expenses actually incurred by Employee in connection with the performance of
Employee’s duties hereunder upon receipt of documentation thereof in accordance
with the Company’s regular reimbursement procedures and practices in effect from
time to time.

(d) The Fringe Benefits provided to Employee pursuant to this Agreement shall be
subject to all withholdings and deductions required by applicable law or by the
Company’s policy, practice or applicable plan.

7. Disability. If Employee suffers a “Disability” as that term is defined in the
Company’s Employment Manual or otherwise established by the Board of Directors,
the Company may terminate the Term of Employment and Employee’s employment
relationship with the Company at any time thereafter by giving Employee five
days written notice of termination. Thereafter, the Company shall have no
obligation to Employee for Base Compensation, Bonus, Fringe Benefits or any
other form of compensation or benefit, except as otherwise required by law, as
noted below, or as set forth in benefit plans provided at Company expense.
Notwithstanding the foregoing, the Employee shall be paid a Bonus for the year
in which his Term of Employment ends that is pro-rated for the period of time
actually worked and payable at a time consistent with the Company’s normal
practice. Reimbursement of appropriately documented expenses incurred by
Employee before the termination of employment, to the extent that Employee would
have been entitled to such reimbursement but for the termination of employment,
will be paid by the Company to Employee. Any compensation in lieu of wages that
Employee receives from any Company-funded insurance, benefit plan or policy
under which Employee was covered at the time of her disability, including, but
not limited to, workers’ compensation wage payments or disability wage payments,
shall be deducted from the Company’s Base Compensation payment to Employee.
Employee, however, shall continue to be bound by the post-employment obligations
and covenants set forth in this Agreement following his/her termination.

 

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8. Death. If Employee dies during the Term of Employment, the Term of Employment
and Employee’s employment relationship with the Company shall terminate as of
the date of Employee’s death. Upon termination of the Term of Employment and
Employee’s employment relationship under this Paragraph 8, the Company shall,
thereafter, have no obligation to Employee or Employee’s estate for Base
Compensation, Bonus, Fringe Benefits or any other form of compensation or
benefit, except as otherwise required by law, as noted below, or as set forth in
benefit plans provided at Company expense. Notwithstanding the foregoing, the
Employee shall be paid a Bonus for the year in which his Term of Employment ends
that is pro-rated for the period of time actually worked and payable at a time
consistent with the Company’s normal practice. Reimbursement of appropriately
documented expenses incurred by Employee before the termination of employment,
to the extent that Employee would have been entitled to such reimbursement but
for the termination of employment, shall be paid by the Company to Employee’s
estate. Any compensation in lieu of wages Employee receives from any
Company-funded insurance, benefit plan or policy under which Employee was
covered at the time of her death, including, but not limited to, workers’
compensation wage payments or disability wage payments, shall be deducted from
the Company’s Base Compensation payment to Employee’s estate. Nevertheless, life
insurance proceeds shall not be deducted from the Company’s Base Compensation
payment to Employee or Employee’s estate.

9. Termination for Cause. The Company may terminate the Term of Employment and
Employee’s employment relationship with it at any time for Cause. Upon
termination of the Term of Employment and Employee’s employment relationship for
Cause under this Paragraph 9, the Company shall, thereafter, have no obligation
to Employee for Base Compensation, Bonus, Fringe Benefits or any other form of
compensation or benefit, except as otherwise required by law or as set forth in
benefit plans provided at Company expense. Reimbursement of appropriately
documented expenses incurred by Employee before the termination of employment,
to the extent that Employee would have been entitled to such reimbursement but
for the termination of employment, shall be paid by the Company to Employee.
Employee, however, shall continue to be bound by the post-employment obligations
and covenants set forth in this Agreement following his/her termination.

10. Termination Without Cause.

(a) The Company may terminate the Term of Employment and Employee’s employment
relationship with it for any or no reason (without Cause), upon written notice
to Employee (the “Termination Notice”). The Company shall then consider
Employee’s employment relationship with it and the Term of Employment terminated
as of the date of the Termination Notice. From and after the delivery of the
Termination Notice, the Company shall pay to Employee severance pay equal to
Employee’s Base Compensation in effect at the time of termination, exclusive of
Bonus and any incentive compensation, and the continuation of employee benefits
for the shorter of (a) the period until Employee is employed other than by the
Company and (b) a period of one year (the “Severance Pay”). The Severance Pay
will be paid to Employee in twelve (12) consecutive monthly installments
beginning on the fifty-second (52nd)

 

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day following the effective date of the Termination Notice; provided however,
that no severance pay will be paid to Employee unless, within the fifty-second
day period referenced above, Employee executes and does not revoke a separation
agreement and general release, each in a form satisfactory to the Company. The
foregoing Severance Pay is in lieu of and the Company shall have no obligation
to Employee for Base Compensation, Bonus, Fringe Benefits or any other form of
compensation or benefit, except as otherwise required by law, or as set forth in
benefit plans provided at Company.

(b) Employee may terminate the Term of Employment and his employment
relationship with the Company for any or no reason, upon sixty (60) days written
notice to the Chairman (“Resignation Notice Period”). If such notice is provided
by Employee, the Chairman, in his sole discretion, may waive the Resignation
Notice Period or any portion thereof, without pay (Base Compensation, etc.) or
Fringe Benefits to Employee for the remaining part of the Resignation Notice
Period. From and after the date specified by the Chairman, the Company shall
have no obligation to Employee for Base Compensation, Fringe Benefits or any
other form of compensation or benefit, except as otherwise required by law, or
as set forth in benefit plans provided at Company expense.

(c) If within the twenty-four (24) month period following a Change in Control
Employee is either terminated (a “Subsequent Termination”) or resigns for “Good
Reason” (a “Good Reason Resignation”), Employee will receive a cash payment from
the Company or its successor-in-interest equal to two times the sum of
(a) Employee’s Base Compensation in effect at the time of the Subsequent
Termination or Resignation for Good Reason plus (b) Employee’s Average Bonus.
Payments received pursuant to this Section 10(c) would be in lieu of any and all
payments Employee would receive under the Company’s Corporate Severance Pay
Plan. The payment will be paid to Employee in twenty-four (24) consecutive
monthly installments beginning on the fifty-second (52nd) day following the date
of Employee’s termination of employment with the Company; provided however, that
no severance pay will be paid unless, within the fifty-two (52) day period
referenced above, Employee executes and does not revoke a separation agreement
and general release, each in a form satisfactory to the Company.

(d) Termination of the Term of Employment and Employee’s employment relationship
with the Company pursuant to this Paragraph 10 shall not release Employee from
Employee’s post-employment obligations and restrictions as set forth in this
Agreement.

(e) Employee shall not be entitled to any payment or benefit under any Company
plan, practice or policy, if any, in effect at or after the time of the
termination of the Term of Employment and the termination of Employee’s
employment relationship with the Company, other than those provided for by this
Agreement.

 

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(f) Reimbursement of appropriately documented expenses incurred by Employee
before the termination of employment in accordance with this Paragraph 10, to
the extent that Employee would have been entitled to such reimbursement but for
termination of his/her employment and the Term of Employment, shall be paid by
the Company to Employee.

(g) The compensation and benefits provided to Employee pursuant to this
Agreement shall be subject to all withholdings and deductions required by
applicable law or by the Company’s policy, practice or applicable plan.

 

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11. Confidential Information.

(a) No Disclosure of Confidential Information. To assist Employee in the
performance of his duties, Company shall provide Employee access to certain
Confidential Information and materials belonging to the Company. Employee shall
protect and guard, and not use for his own benefit or the benefit of anyone
other than Company, or disclose, publish, communicate, reveal or divulge,
directly or indirectly, any Confidential Information of Company to any person or
entity at any time or in any manner without the prior written consent of the
Chairman, except as required in the course of employment with the Company.

(b) Inevitable Use or Disclosure. Employee shall not, while employed by the
Company and for a period of two (2) years after the termination thereof, for any
reason whatsoever, without the written consent of the Chairman, directly or
indirectly, engage in, represent in any way, be connected with, furnish
consulting services to, be employed by, or have any interest, whether as owner,
employee, principal, partner, servant, agent, employee, representative,
independent contractor, member, distributor, consultant, officer, director,
stockholder, or otherwise, whether or not for compensation, in any business
which through the faithful performance of his duties thereof could reasonably be
anticipated to lead to the use or disclosure of Company’s Confidential
Information.

(c) Ownership and Return of Company’s Property Upon Termination. Employee
acknowledges and confirms that all Confidential Information which are conceived,
developed, or made by Employee in the course of his employment with the Company,
or disclosed to or otherwise acquired by his in the course of his employment
with the Company, are and shall remain the sole and exclusive property of the
Company; that he shall not retain, copy or otherwise appropriate any of such
Confidential Information for his own use or the use or purposes of any third
party, without the prior written consent of the Chairman; and that, upon the
termination of his employment, for any reason whatsoever, he shall promptly
return all such Confidential Information, including all copies or multiple
versions thereof (regardless of the form or medium contained or stored in
(including hard copy, electronic or digital form)), to the Company and, in the
case of intangible information, shall continue to hold them as the confidential
property of the Company and not disclose them, directly or indirectly, or use
them for any purpose, without the prior written consent of the Chairman.

12. Inventions.

(a) Employee shall promptly disclose to the Company in writing all Inventions,
whether or not patentable, copyrightable or protectable as trade secrets,
conceived, developed, or made by Employee, alone or with others, during the
period of Employee’s employment with the Company, whether during working hours
or not, and, in the case of clauses (ii) and (iii) below, during the period of
Employee’s employment with the Company and at any time after Employee ceases to
be employed by the Company, for any reason whatsoever, which: (i) relate in any
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Company; (ii) are conceived, developed, or made using equipment, supplies,
facilities, trade secrets or confidential information of Company; or
(iii) result from, arise out of or relate to work performed by Employee for
Company.

(b) Employee shall transfer and assign, and does hereby transfer and assign, to
the Company all of his right, title and interest in and to each Invention
covered by this Paragraph 12. As may be requested by the Company from time to
time, Employee shall take all steps reasonably necessary to assist Company in
obtaining and enforcing any patent, copyright, or other protection which the
Chairman elects to obtain or enforce, in any country, for any Invention covered
by this Paragraph 12. Employee’s obligation to assist the Company in obtaining
and enforcing such patents, copyrights, and other protections will continue
beyond the termination of Employee’s employment with the Company, for any reason
whatsoever, but the Company shall compensate Employee at a reasonable rate of
compensation, as determined in the sole discretion of the Chairman, after the
termination of his employment for the time actually spent providing such
assistance. If the Company is unable, after reasonable effort, to secure
Employee’s signature on any document needed to apply for, prosecute, or enforce
any patent, copyright, or other protection in relation to any Invention, whether
because of Employee’s physical or mental incapacity or for any other reason
whatsoever, Employee hereby irrevocably designates and appoints Company and its
duly authorized officers and agents as Employee’s agent and attorney-in-fact, to
act for and in Employee’s behalf and stead to execute and file any such document
and to do all other lawfully permitted acts to further the prosecution and
enforcement of patents, copyrights, or other protections with the same legal
force and effect as if executed by Employee.

13. Confidential Information of Others.

(a) During the Term of Employment, Employee shall not improperly use or disclose
any confidential information of any former or concurrent employer or other
person or entity without the prior written consent of that employer, person or
entity. Furthermore, during the Term of Employment, Employee shall not bring
onto Company premises any such confidential information of any former or
concurrent employer or other person or entity without the prior written consent
of that employer, person or entity.

(b) Employee represents and warrants that he is not a party to or bound by any
other employment agreement or other agreement or understanding that requires him
to transfer or assign any Invention or discovery conceived, developed, or made
by Employee, alone or with others.

14. No Solicitation of Customers or Potential Customers. Employee shall not,
during the Term of Employment and for a period of two (2) years after the
termination thereof, for any reason whatsoever, without the written consent of
the individual then holding the office of Chairman, other than for the account
of the Company, directly or indirectly, solicit, attempt to solicit, or cause to
be solicited any party who was a customer of the Company at the time of
Employee’s employment with or termination of employment, for any reason
whatsoever, by the

 

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Company, or who was a customer of or was actively solicited by the Company, its
agents, representatives, or employees to be a customer within twelve (12) months
prior to Employee’s termination of employment,.

15. No Hiring of Employees. Employee shall not, during the Term of Employment
and for a period of two (2) years after the termination thereof, for any reason
whatsoever, without the written consent of the individual then holding the
office of Chairman, other than for the account of the Company, directly or
indirectly: (a) hire or employ any employee of or other person associated with
the Company on behalf of any individual, including himself/herself, corporation
or other entity; or (b) induce or attempt to induce any employee or other person
associated with the Company to leave the employ of or cease doing business with
the Company.

16. No Inducement to Cease Doing Business with Company. Employee shall not,
during the Term of Employment and for a period of two (2) years after the
termination thereof, for any reason whatsoever, without the written consent of
the individual then holding the office of Chairman or his designee, directly or
indirectly, induce or attempt to induce any customer, supplier, manufacturer,
licensor, association, organization, vendor or any other person or entity to
cease doing or reducing the amount of business with the Company.

17. No Competition. In consideration of his employment and for the access to
Confidential Information provided by Company and so as to enforce Employee’s
agreement regarding such Confidential Information, Employee shall not, during
the Term of Employment and for a period of two (2) year after the termination
thereof, for any reason whatsoever, without the written consent of the
individual then holding the office of Chairman, directly or indirectly, engage
in, represent in any way, be connected with, furnish consulting services to, be
employed by, or have any interest, whether as owner, employee, principal,
partner, servant, agent, employee, representative, independent contractor,
member, distributor, consultant, officer, director, stockholder, or otherwise,
in any business that engages in business activities included within, arising out
of or related to the Company’s Business Activities; provided, however, that the
foregoing will not prohibit Employee from owning up to one percent (1%) of any
class of equity securities of a company whose securities are publicly traded on
a national securities exchange or in a national market system.

18. Breach. Employee acknowledges and confirms that the restrictions contained
in this Agreement, in view of the nature of the Company’s business, are
reasonable and necessary in order to protect the legitimate business interests
of the Company and that any breach or threatened breach of the provisions of
this Agreement shall cause irreparable injury to the Company, that money damages
will not provide an adequate remedy, and that their enforcement will not impose
a hardship on Employee or significantly impair Employee’s ability to earn a
livelihood. Employee further acknowledges and confirms that the remedy at law
for any breach of the foregoing will be inadequate, and the Company shall
therefore be entitled, in addition to any other relief available to it, to
preliminary, temporary and permanent injunctive relief without the necessity of
proving irreparable harm or posting bond or other security. If

 

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provisions of this Agreement are ever determined by a court of competent
jurisdiction to exceed limitations permitted by law, then such provisions shall
be reformed automatically to set forth the maximum limitations permissible by
law. If Employee violates any of the restrictions contained in this Agreement,
the relevant restricted period shall be extended by a period equal to the length
of time from the commencement of any such violation until such time as such
violation shall be deemed, by the Chairman to be cured. Nothing contained herein
shall be considered as prohibiting the Company from pursuing any other remedies
available to it for such breach or threatened breach, including any recovery of
damages from Employee. Employee further covenants and agrees that if he violates
this Agreement, Employee shall pay to the Company any reasonable attorneys’ fees
and costs that it may incur in connection with the enforcement of its rights
under this Agreement. The Company may supply a copy of this Agreement to any
future or prospective employer of Employee or to any person or entity to whom
Employee has supplied information if the Company determines, in its sole
discretion, that there is a reasonable likelihood that Employee has violated or
shall violate any portion of this Agreement.

19. No Disparagement. Employee shall not make any disparaging remarks to any
person or entity regarding the Company or its business practices during
employment or after termination, for any reason whatsoever.

20. Prior Agreements. Employee represents and warrants to the Company that there
are no restrictions, agreements or understandings, including, but not limited
to, prior covenant not to compete agreements, oral or written, to which Employee
is a party or by which Employee is bound, that prevent or make unlawful or
actionable Employee’s execution or performance of this Agreement.

21. Employee Cooperation. Employee shall make himself available and cooperate in
any reasonable manner in providing assistance to the Company in concluding and
defending any business or legal matters which relate to the Company. Employee’s
obligation to assist the Company shall continue beyond the termination of
Employee’s employment with the Company, for any reason whatsoever. In the event
that Employee is requested by the Company to provide such assistance
post-termination in such matters, then the Company shall reimburse the Employee
for his reasonable and necessary expenses incurred in providing such assistance,
including reasonable attorneys’ fees, provided, however that the Company may
direct the use of Company counsel to the extent legally permissible.
Furthermore, Employee shall not initiate, commence, voluntarily cooperate or
provide assistance to any third party or individual in connection with any claim
against the Company, whether pending or otherwise, without the prior written
consent of the Chairman. In the case of legal proceedings, Employee shall notify
the Chairman, of any subpoena or other similar notice to give testimony or
provide documentation (“Notice”), within two (2) days of receipt of said Notice
and prior to providing any response to said Notice such that the Company may
have an opportunity to seek and obtain, among other things, an appropriate
protective order or seek intervention in the matter.

 

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22. Electronic Communication Systems.

(a) Employee shall not use for his personal use any of the Company’s electronic
communication systems (including, but not limited to, desktop or laptop
computers, facsimile machines, PDAs, telephones, cell phones, any portable data
storage devices (including, but not limited to, thumb/flash memory, hard disc
drive, CDs, DVDs, floppy disks or any other type of magnetic or optical storage
device or any other device of similar function) (collectively referred to herein
as “Device(s)”) except for such limited, occasional and incidental use as does
not materially or adversely impact the Company’s information technology systems
infrastructure nor degrade or impair in any respect any of the security systems
or procedures in place to preserve and protect the Company’s systems, data and
information.

(b) Employee acknowledges and confirms that:

(i) all electronic (e-mail/internet/world wide web (“www”)) communication
systems operated by the Company (collectively referred to herein as “Systems”),
as well as information stored, downloaded, transmitted, received, or contained
in such Systems, are the property of the Company. These Systems are to be used
solely for job related purposes; and

(ii) The Company reserves and intends to exercise the right at any time to
review, audit, intercept, access, and disclose all materials created, received
or sent over such Systems and that s/he shall have no expectation of privacy
from such access or monitoring. The right of the Company to such access and
monitoring shall include Employee’s personal password protected email accounts
that are otherwise accessed by Employee on such Systems; and

(iii) the Systems shall not be used to solicit others for commercial ventures,
religious or political causes, outside organizations or other non-business
matters; and

(iv) the Systems shall not be used to create any offensive or disruptive
messages. Offensive and disruptive messages include, but are not limited to, any
messages which are in contravention of Company’s Non-Harassment Policy, which
contain any racial or ethnic slurs or which offensively address someone’s age,
gender, sexual orientation, religious or political beliefs, national origin, or
disability/handicap or other classification protected by applicable law; and

(v) the Systems shall not be used to send (upload) or retrieve (download)
copyrighted materials, trade secrets, proprietary business or financial
information or similar materials without the prior written consent of the
Chairman.

23. Miscellaneous.

(a) Indulgences, Etc. Neither the failure nor any delay on the part of either
party to exercise any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or

 

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privilege preclude any other or further exercise of the same or of any other
right, remedy, power or privilege, nor shall any waiver of any right, remedy,
power or privilege with respect to any occurrence be construed as a waiver of
such right, remedy, power or privilege with respect to any other occurrence. No
waiver shall be effective unless it is in writing and is signed by the party
asserted to have granted such waiver.

(b) Controlling Law. This Agreement and all questions relating to its validity,
interpretation, performance and enforcement (including, without limitation,
provisions concerning limitations of actions), shall be governed by and
construed in accordance with the laws of the State of New Jersey,
notwithstanding any conflict-of-laws doctrines of such jurisdiction to the
contrary, and without the aid of any canon, custom or rule of law requiring
construction against the draftsman.

(c) Notices. All notices, requests, demands and other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been duly given, made and received only when personally delivered, on the day
specified for delivery when deposited with a recognized national or regional
courier service for delivery to the intended addressee or two days following the
day when deposited in the United States mails, first class postage prepaid,
addressed as set forth below:

 

  (i) If to Employee:

Brad Pedersen

9 Thornhill Drive

Lumberton, New Jersey 08048

 

  ii) If to the Company:

Breeze-Eastern Corporation

35 Melanie Lane

Whippany, New Jersey 07981

Att: Chairman of the Board of Directors

With a copy, given in the manner prescribed above, to:

Fox Rothschild LLP

997 Lenox Drive

Lawrenceville, New Jersey 08648

Att: Matthew H. Lubart, Esq.

Any party may alter the address to which communications or copies are to be sent
by giving notice of such change of address in conformity with the provisions of
this Paragraph 23 (c) for the giving of notice.

(d) Binding Nature of Agreement. This Agreement shall be binding upon the
Company and shall inure to the benefit of the Company including any transferee
of the

 

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business operation, as a going concern, in which Employee is employed and shall
be binding upon Employee, Employee’s heirs and personal representatives. None of
the rights or obligations of Employee hereunder may be assigned or delegated,
except that in the event of Employee’s death or Disability, any rights of
Employee hereunder shall be transferred to Employee’s estate or personal
representative, as the case may be. The Company may assign its rights and
obligations under this Agreement in whole or in part to any one, and such
assignment shall relieve the Company of its obligations to Employee under the
terms of this Agreement.

(e) Execution in Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
any number of counterparts hereof, individually or taken together, shall bear
the signatures of all of the parties reflected hereon as the signatories.

(f) Provisions Separable. The provisions of this Agreement are independent of
and separable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.

(g) Entire Agreement/Release. This Agreement contains the entire understanding
among the parties hereto with respect to the employment of Employee by the
Company, and supersedes all prior and contemporaneous agreements (including, but
not limited to, the Letter Agreement dated April 29, 2012) and understandings,
inducements or conditions, express or implied, oral or written, except as herein
contained. The express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with any of the terms hereof.
This Agreement may not be modified or amended other than by an agreement in
writing executed by both parties to this Agreement. Furthermore, Employee
acknowledges and confirms that any subsequent change or changes in his duties,
compensation or benefits shall not affect the validity or scope of this
Agreement. Notwithstanding the foregoing, nothing herein shall limit the
application of any generally applicable Company policy, practice, plan or the
terms of any manual or handbook applicable to the Company’s employees generally,
except to the extent the foregoing directly conflict with this Agreement, in
which case the terms of this Agreement shall prevail.

(h) Paragraph Headings. The Paragraph headings in this Agreement are for
convenience only; they form no part of this Agreement and shall not affect its
interpretation.

(i) Number of Days. Except as otherwise provided herein, for example, in the
context of vacation days, in computing the number of days for purposes of this
Agreement, all days shall be counted, including Saturdays, Sundays and holidays;
provided, however, that if the final day of any time period falls on a Saturday,
Sunday or holiday on which federal banks are or may elect to be closed, then the
final day shall be deemed to be the next day which is not a Saturday, Sunday or
such holiday.

 

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(j) Gender, etc. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context indicates is appropriate.

(k) Jurisdiction of Courts. Any suit, action, claim, proceeding or investigation
arising out of or relating to this Agreement shall be brought only in, and
Employee and the Company consent to subject themselves to the personal
jurisdiction of, the New Jersey Superior Court located in Morris County, New
Jersey or the United States District Court for the District of New Jersey (to
the extent that subject matter jurisdiction exists), and each of the parties
hereto waives any objection which party may now or hereafter have to such venue
of any such suit, action, claim, proceeding or investigation, and irrevocably
submits to the personal and subject matter jurisdiction of any such court. Any
and all service of process and any other notice in any such suit, action, claim,
proceeding or investigation shall be effective against any party if given by
registered or certified mail, return receipt requested, or by any other means of
mail which requires a signed receipt, postage prepaid, mailed to such party as
herein provided.

(l) Survival. All provisions of this Agreement which by their terms survive the
termination of Employee’s employment with the Company, including, but not
limited to, the post-employment obligations and covenants of Employee set forth
in Paragraphs 11 through 23 inclusive shall survive termination of Employee’s
employment by the Company and shall remain in full force and effect thereafter
in accordance with their terms.

(m) Breach. In the event Employee breaches this Agreement and such breach is
proven in a Court of Law, Employee shall be required to pay the Company’s actual
and reasonable attorney’s fees and costs associated with the dispute.

(n) Disclosure of Agreement. The Company may disclose the terms of this
Agreement, including, but not limited to, Employee’s obligations hereunder, to
others in the sole discretion of the Chairman.

(o) Representation of the Company. The Company represents and warrants that the
undersigned has the authority to act on behalf of it and to bind the Company to
this Agreement.

(p) Reliance on Statements. In signing this Agreement, the parties hereto
represent and warrant that they are not relying on any statements,
representations or promises made by the other party or their agent(s) except as
specifically set forth herein.

 

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24. Representations of Employee. Employee represents and warrants to the Company
that he:

(a) has been given a copy of this Agreement to retain with his personal records;

(b) has read and understands the entire contents of this Agreement;

(c) has the capacity to act on his own behalf and to bind himself/herself to
this Agreement;

(d) was afforded a sufficient opportunity to obtain independent legal counsel
prior to executing this Agreement and has executed this Agreement voluntarily
and of his own free will; and

(e) understands that the execution of this Agreement is a condition of his
employment by the Company.

IN WITNESS WHEREOF, the parties have duly executed and delivered this Agreement
in as of the date first above written.

 

      BREEZE-EASTERN CORPORATION By:  

/s/ Brad Pedersen

    By:  

/s/ Robert J. Kelly

  BRAD PEDERSEN       ROBERT J. KELLY,         Chairman of the Board of
Directors

 

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