Exhibit 10.38

EMPLOYMENT AGREEMENT

LMI AEROSPACE, INC., a Missouri corporation (the “Corporation”), and Michael J.
Biffignani (“Employee”) hereby agree as follows:

1.           Employment. The Corporation hereby employs Employee, and Employee
accepts employment from the Corporation, upon the terms and conditions
hereinafter set forth. Any and all employment agreements heretofore entered into
between the Corporation and Employee are hereby terminated and cancelled, and
each of the parties hereto mutually releases and discharges the other from any
and all obligations and liabilities heretofore or now existing under or by
virtue of any such employment agreements, it being the intention of the parties
hereto that this Agreement, effective immediately, shall supersede and be in
lieu of any and all prior employment agreements between them.

2.           Term of Employment.

(A)           The initial term of Employee’s employment under this Agreement
shall commence on January 1, 2008 and shall terminate on December 31, 2010;
provided, however, that this Agreement shall be automatically extended for
additional terms of one year each unless not later than October 31 of any year
beginning in 2010, either party has given written notice to the other party of
its or Employee’s intention not to extend the term of this Agreement; and
provided, further, that the term of employment may be terminated upon the
earlier occurrence of any of the following events:
 
(1)           Upon the termination of the business or corporate existence of the
Corporation;
 
(2)           At the Corporation’s option, in the event the Corporation
determines that Employee is not performing the duties required of Employee
hereunder to the satisfaction of the Corporation;
 
(3)           Upon the death of the Employee;
 
(4)           At the Corporation’s option, if Employee shall suffer a permanent
disability; (For the purposes of this Agreement, “permanent disability” means
any physical or mental impairment that renders the Employee unable for a period
of six (6) months or more to perform the essential job functions of Employee’s
position, even with reasonable accommodation, as determined by a physician
selected by the Corporation. The Employee acknowledges and agrees that Employee
shall voluntarily submit to a medical or psychological examination for the
purpose of determining Employee’s continued fitness to perform the essential
functions of Employee’s position whenever requested to do so by the Corporation.
If the Corporation elects to terminate the employment relationship on this
basis, the Corporation shall notify the Employee or Employee’s representative in
writing and the termination shall become effective on the date that such
notification is given;
 
(5)           At the Corporation’s option, upon ten (10) calendar days’ written
notice to Employee, in the event of any breach or default by Employee of any of
the terms of this Agreement or of any of Employee’s duties or obligations
hereunder. In lieu of providing ten (10) calendar days’ advance written notice,
the Corporation, at its sole option, may terminate the Employee’s services
immediately and pay Employee an amount that is equivalent to ten (10) calendar
days of Employee’s salary, less any deductions required by law;
 
(6)           At the Corporation’s option, without any advance notice, in the
event that the Employee engages in conduct which, in the opinion of the
Corporation, (1) constitutes dishonesty of any kind (including, but not limited
to, any misrepresentation of facts or falsification of records) in Employee’s
relations, interactions or dealings with the Corporation or its customers; (2)
constitutes a felony; (3) potentially may or will expose the Corporation to
public disrepute or disgrace, or potentially may or will cause harm to the
customer relations, operations or business prospects of the Corporation; (4)
constitutes harassment or discrimination towards any person associated with the
Corporation, whether an employee, agent or customer, based upon that person’s
race, color, national origin, sex, age, disability, religion, or other protected
status; (5) reflects disruptive or disorderly conduct, including but not limited
to, acts of violence, fighting, intimidation or threats of violence against any
person associated with the Corporation, whether an employee, agent or customer,
or possessing a weapon while on the Corporation’s premises or while acting on
behalf of the Corporation; (6) is indicative of abusive or illegal drug use
while on the Corporation’s premises or while acting on the Corporation’s behalf;
or (7) constitutes a willful violation of any governmental rules or regulations;
or
 
(7)           At the Employee’s option, after providing the Corporation with at
least thirty (30) calendar days advance written notice of Employee’s intention
to terminate the employment relationship.
 
If employment is terminated for any of the reasons set forth in subparagraphs
(3) through (7) of this section 2(A), Employee shall be entitled to receive only
the Base Salary (as that term is hereinafter defined) accrued but unpaid as of
the date of the termination and shall be ineligible to receive any additional
compensation or severance pay. If, on the other hand, employment is terminated
by the Corporation during the term of this Agreement for any reason other than
those set forth in paragraphs (3) through (7) of this section 2(A), subject to
the conditions set forth in paragraphs 2(C) and (D) of this Agreement, the
Corporation shall provide severance pay to Employee in an amount based upon
Employee’s length of service with the Corporation. Specifically, the Corporation
shall provide Employee with six (6) months of Base Salary if Employee has less
than five (5) years of service with the Corporation as of the date of Employee’s
termination and with twelve (12) months of Base Salary if Employee has five (5)
or more years of service with the Corporation as of the date of Employee’s
termination. Such severance pay shall be paid in equal monthly installments,
unless the Corporation, within its sole discretion, elects to pay the present
value of the severance pay in a lump sum within thirty (30) calendar days of the
termination.

(B)           If employment is terminated in conjunction with a change in the
control of the Corporation or in conjunction with the sale of substantially all
of the operating assets of the Corporation, the Corporation will provide
Employee with severance pay under the circumstances specified in subparagraphs
(1) and (2) of this paragraph (B), and the conditions set forth in paragraphs
2(C) and (D) of this Agreement. For the purposes of this Agreement, a “change in
control” is defined as the sale of substantially all of the operating assets of
the Corporation or the acquisition of more than fifty percent (50%) of the stock
of the Corporation by a group of shareholders or an entity which acquires
control of the Corporation (a “Purchaser”).

(1)           If the change in control or the sale results in the involuntary
termination of Employee or results in the Employee electing to terminate
Employee’s employment for a good reason as determined by the Corporation (such
as the Purchaser refusing to offer full time employment to Employee on terms
comparable to those provided by the Corporation prior to the acquisition or the
Purchaser requiring Employee to move to a new location), the Corporation shall
provide Employee with severance pay in an amount that is equal to two times
Employee’s annual Base Salary and shall pay Employee any reasonably anticipated
Performance Bonus for the fiscal year in which Employee was terminated on a
prorated basis.

(2)           If Employee voluntarily terminates Employee’s employment without a
good reason (as determined by the Corporation) within ninety (90) days after the
change in control or the sale, the Corporation shall provide Employee with six
(6) months of Base Salary if Employee has less than five (5) years of service
with the Corporation as of the date of Employee’s termination and with twelve
(12) months of Base Salary if Employee has five (5) or more years of service
with the Corporation as of the date of Employee’s termination.

(3)           For purposes of this paragraph 2(B), in the event a change of
control occurs after April 1, 2007, Employee may take up to nine (9) months from
the date of change of control to claim severance pay, as provided in paragraph
2(B)(1) and (2).

(C)           The severance pay provided for in section 2(A) of this Agreement
shall be paid in equal monthly installments, unless the Corporation, within its
sole discretion, elects to pay the present value of the severance pay in a lump
sum within thirty (30) calendar days of the termination. For purposes of
calculating the present value of the severance pay, the discount rate shall be
the prime rate quoted in the Wall Street Journal on the day the Corporation
elects to pay the present value of the severance pay in a lump sum.

(D)           Notwithstanding anything to the contrary, (i) the amount of
severance pay provided under this Agreement shall not under any circumstances
exceed the limitations set forth in § 280G of the Code, and (ii) the
Corporation’s obligation to pay the severance pay provided for in this section 2
shall be conditioned on Employee’s execution of a written release satisfactory
to the Corporation.

3.           Compensation.

(A)           During the period from January 1, 2008 to December 31, 2008, the
Corporation shall compensate Employee for Employee’s services rendered hereunder
by paying to Employee an annual salary (the “Base Salary”) of One Hundred Ninety
Four Thousand, One hundred Eighty Three Dollars ($194,183.00), less any
authorized or required payroll deductions. During the period from January 1,
2009 to December 31, 2009, the Employee’s Base Salary shall be Two Hundred
Thousand, Eight Dollars ($200,008.00), less any authorized or required payroll
deductions. During the period from January 1, 2010 to December 31, 2010, the
Employee’s Base Salary shall be Two Hundred Six Thousand, Eight Dollars
($206,008.00), less any authorized or required payroll deductions. Thereafter,
as long as this Agreement remains in effect, the annual Base Salary that the
Corporation shall pay to the Employee for Employee’s services rendered hereunder
will be Two Hundred Six Thousand, Eight Dollars ($206,008.00), less any
authorized or required payroll deductions. Payment of this salary will be made
in accordance with the payroll policies of the Corporation in effect from time
to time.

(B)           With respect to fiscal year 2008 of the Corporation, (i) provided
that Employee is employed under the terms of this Agreement as of the last day
of 2008, and (ii) the Corporation’s “Annual Income from Operations” (as that
term is hereinafter defined) is more than the lesser of Fifteen Million Dollars
($15,000,000.00) or Sixty Percent (60%) of the Corporation’s annual budget for
Annual Income from Operations, the Corporation shall pay to Employee, in
addition to the Base Salary, an annual “Performance Bonus”. Thereafter, with
respect to each complete fiscal year of the Corporation subsequent to 2008
during which (i) the Employee is employed under the terms of this Agreement as
of the last day of such fiscal year, and (ii) the Corporation’s “Annual Income
from Operations” (as that term is hereinafter defined) is more than Sixty
Percent (60%) of the Corporation’s annual budget for Annual Income from
Operations, the Corporation shall pay to Employee, in addition to the Base
Salary, an annual “Performance Bonus”.
The amount of the annual Performance Bonus (if any) shall be equal to:
 
 
(1)
five percent (5.0%) of the Employee’s Base Salary; plus

 
(2)
Thirty Five hundredths of one percent (0.350%) of the excess of the
Corporation’s Annual Income from Operations over the thresholds defined in (B)
above.

 
In the event the Corporation’s Annual Income from Operations for fiscal year
2008 of the Corporation is less than the lesser of Fifteen Million Dollars
($15,000,000.00) or Sixty Percent (60%) of the Corporation’s Annual budget for
Annual Income from Operations, the Employee shall not be entitled to a
Performance Bonus with respect to such fiscal year. Thereafter, in years
subsequent to 2008, in the event the Corporation’s Annual Income from Operations
for any given fiscal year is less than Sixty Percent (60%) of the Corporation’s
Annual budget for Annual Income from Operations, the Employee shall not be
entitled to a Performance Bonus with respect to fiscal year 2008.

For purposes of the calculation of the Performance Bonus, the Corporation’s
“Annual Income from Operations” means the consolidated Income from Operations of
the Corporation and its subsidiaries, for a given fiscal year, as determined by
the firm of independent certified public accountants providing auditing services
to the Corporation, using generally accepted accounting principles consistently
applied, and calculated without regard to (a) any bonus paid to the
Corporation’s Chairman of the Board and any formula bonuses paid pursuant to
employment contracts, (b) federal and state income tax, (c) any interest expense
or other income and expense as they appear on the Corporation’s annual audited
financial statements, (d) any income or loss related to D3 Technologies, and (e)
any income or loss attributable to any other corporation or entity (including
the assets of a corporation or entity that constitute an operating business)
acquired by or merged into the Corporation subsequent to the effective date of
this Agreement. The Corporation shall pay to Employee any Performance Bonus due
the Employee hereunder not later than fifteen (15) days after the receipt by the
Corporation of its annual audited financial statements, which the Corporation
expects to receive within ninety (90) days after the end of each fiscal year of
the Corporation.

(C)           In addition to the Base salary and Performance Bonus (if any),
Employee shall be entitled to receive such bonus compensation as the Board of
Directors of the Corporation may authorize from time to time.

(D)           The Corporation retains the right to modify or adjust the manner
in which the Performance Bonus is calculated in the event that the Corporation
either acquires the assets of another entity, or any portion thereof, or sells
its assets, or any portion thereof, to another entity.

4.           Duties of Employee.

(A)           Employee shall serve as Chief Information Officer of the
Corporation or in such other positions as may be determined by the Board of
Directors of the Corporation, and Employee shall perform such duties on behalf
of the Corporation and its subsidiaries by such means, at such locations, and in
such manner as may be specified from time to time by the officers or Board of
Directors of the Corporation.

(B)           Employee agrees to abide by and conform to all rules established
by the Corporation applicable to its employees.

(C)           Employee acknowledges that Employee is being employed as a
full-time employee, and Employee agrees to devote so much of Employee’s entire
time, attention and energies to the business of the Corporation as is necessary
for the successful operation of the Corporation and shall endeavor at all times
to improve the business of the Corporation. Employee shall not accept any
business commitments other than with the Corporation without the advance written
consent of the Corporation’s President.

5.           Expenses. During the period of Employee’s employment, except as
otherwise specifically provided in this Agreement, the Corporation will pay
directly, or reimburse Employee for, all items of reasonable and necessary
business expenses approved in advance by the Corporation if such expenses are
incurred by Employee in the interest of the business of the Corporation. The
Corporation shall also reimburse Employee for automobile expenses incurred by
Employee in the performance of Employee’s duties hereunder. The amount of such
reimbursement shall be in accordance with the automobile expense reimbursement
policy adopted (and as it may be modified from time to time) by the
Corporation’s Board of Directors. All such expenses paid by Employee will be
reimbursed by the Corporation upon presentation by Employee, from time to time
(but not less than quarterly), of an itemized account of such expenditures in
accordance with the Corporation’s policy for verifying such expenditures.

6.           Fringe Benefits.

(A)           Employee shall be entitled to participate in any health, accident
and life insurance program and other benefits which have been or may be
established by the Corporation for salaried employees of the Corporation.

(B)           Employee shall be entitled to an annual vacation without loss of
compensation for such period as may be determined by the Board of Directors of
the Corporation.

(C)           The Corporation shall furnish to the Employee during the term of
Employee’s employment an automobile selected by the Corporation to aid the
Employee in the performance of Employee’s duties. Upon agreement of the
Corporation and the Employee, the Corporation may, in lieu of the automobile,
provide the Employee with a Six Thousand Dollar ($6,000.00) annual automobile
allowance.

7.           Covenants of Employee.

(A)           During the term of Employee’s employment with the Corporation and
for all time thereafter Employee covenants and agrees that Employee will not in
any manner directly or indirectly, except as required in Employee’s duties to
the Corporation, disclose or divulge to any person, entity, firm or company
whatsoever, or use for Employee’s own benefit or the benefit of any other
person, entity, firm or company, directly or indirectly, any knowledge, devices,
information, trade secrets, techniques, customer lists, business plans or other
data belonging to the Corporation or developed by Employee on behalf of the
Corporation during Employee’s employment with the Corporation, without regard to
whether all of the foregoing matters will be deemed confidential, material or
important, the parties hereto stipulating, as between them, that the same are
important, material, confidential and the property of the Corporation
(hereinafter “Confidential Information”), that disclosure of the same to or use
of the same by third parties would greatly affect the effective and successful
conduct of the business of the Corporation and the goodwill of the Corporation,
and that any breach of the terms of this subparagraph (A) shall be a material
breach of this Agreement.

(B)           During the term of Employee’s employment with the Corporation and
for a period of two (2) years or one (1) year with respect to subparagraph (4)
below (the “Covenant Term”) after cessation for whatever reason of such
employment (except as hereinafter provided in subparagraph (C) of this paragraph
7, Employee covenants and agrees that Employee will not in any manner directly
or indirectly:

(1)           solicit, divert, take away or interfere with any of the customers
(or their respective affiliates or successors) of the Corporation;

(2)           engage directly or indirectly, either personally or as an
employee, partner, associate partner, officer, manager, agent, advisor,
consultant or otherwise, or by means of any corporate or other entity or device,
in any business which is competitive with the business of the Corporation. For
purposes of this covenant a business will be deemed competitive if it is
conducted in whole or in part within any geographic area wherein the Corporation
is engaged in marketing its products, and if it involves the manufacture of
component parts for the aerospace industry or any other business which is in any
manner competitive, as of the date of cessation of Employee’s employment, with
any business then being conducted by the Corporation or as to which the
Corporation has then formulated definitive plans to enter;

(3)           induce any salesman, distributor, supplier, manufacturer,
representative, agent, jobber or other person transacting business with the
Corporation to terminate their relationship with the Corporation, or to
represent, distribute or sell products in competition with products of the
Corporation; or

(4)           induce or cause any employee of the Corporation to leave the
employ of the Corporation.

(C)           The parties agree that the Covenant Term provided for in the
preceding subparagraph (B) shall be:

(1)           reduced to six (6) months in the event all of the operating assets
or all of the common stock of the Corporation is sold to any entity or
individuals unaffiliated with the Corporation, its successors or assigns; or

(2)           eliminated if the business currently operated by the Corporation
is terminated and the assets of the Corporation are liquidated.

(D)           All the covenants of Employee contained in this paragraph 7 shall
be construed as agreements independent of any other provision of this Agreement,
and the existence of any claim or cause of action against the Corporation,
whether predicated on this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Corporation of these covenants.

(E)            It is the intention of the parties to restrict the activities of
Employee under this paragraph 7 only to the extent necessary for the protection
of legitimate business interests of the Corporation, and the parties
specifically covenant and agree that should any of the provisions set forth
therein, under any set of circumstances not now foreseen by the parties, be
deemed too broad for such purpose, said provisions will nevertheless be valid
and enforceable to the extent necessary for such protection.

8.           Documents. Upon cessation of Employee’s employment with the
Corporation, for whatever reason, all documents, records (including without
limitation, customer records), notebooks, invoices, statements or
correspondence, including copies thereof, relating to the business of the
Corporation then in Employee’s possession, whether prepared by Employee or
others, will be delivered to and left with the Corporation, and Employee agrees
not to retain copies of the foregoing documents without the written consent of
the Corporation.

9.           Remedies. In the event of the breach by Employee of any of the
terms of this Agreement, notwithstanding anything to the contrary contained in
this Agreement, the Corporation may terminate the employment of Employee in
accordance with the provisions of paragraph 2 of this Agreement. It is further
agreed that any breach or evasion of any of the terms of this Agreement by
Employee will result in immediate and irreparable injury to the Corporation and
will authorize recourse to injunction and/or specific performance as well as to
other legal or equitable remedies to which the Corporation may be entitled. In
addition to any other remedies that it may have in law or equity, the
Corporation also may require an accounting and repayment of all profits,
compensation, remuneration or other benefits realized, directly or indirectly,
as a result of such breaches by the Employee or by a competitor’s business
controlled, directly or indirectly, by the Employee. No remedy conferred by any
of the specific provisions of this Agreement is intended to be exclusive of any
other remedy and each and every remedy given hereunder or now or hereafter
existing at law or in equity by statute or otherwise. The election of any one or
more remedies by the Corporation shall not constitute a waiver of the right to
pursue other available remedies. Employee expressly agrees to pay all reasonable
costs and attorneys’ fees incurred by the Corporation in order to enforce the
Employee’s obligations under this Agreement, regardless of whether litigation is
commenced or prosecuted to a judgment.

10.           Severability. All agreements and covenants contained herein are
severable, and in the event any of them shall be held to be invalid by any court
of competent jurisdiction, this Agreement, subject to subparagraph 7(E) hereof,
shall continue in full force and effect and shall be interpreted as if such
invalid agreements or covenants were not contained herein.

11.           Entire Agreement. This Agreement constitutes the entire agreement
between the Corporation and the Employee with respect to the subject matter
hereof and supersedes all prior proposals, negotiations, representations,
communications, writings, outlines and agreements between the Corporation and
the Employee with respect to the subject matter hereof, whether oral or written,
which shall be of no further force and effect. No amendments to this Agreement,
except as expressly provided herein to the contrary, may be made except by a
writing signed by both parties.

12.           Waiver or Modification. No waiver or modification of this
Agreement or of any covenant, condition or limitation herein shall be valid
unless in writing and duly executed by the party to be charged therewith, and no
evidence of any waiver or modification shall be offered or received in evidence
in any proceeding, arbitration or litigation between the parties hereto arising
out of or affecting this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this Paragraph
may not be waived except as herein set forth. Failure of the Corporation to
exercise or otherwise act with respect to any of its rights hereunder in the
event of a breach of any of the terms or conditions hereof by Employee shall not
be construed as a waiver of such breach nor prevent the Corporation from
thereafter enforcing strict compliance with any and all of the terms and
conditions hereof

13.           Assignability. This Agreement may be assigned by the Corporation
to another entity which purchases substantially all of the assets of the
Corporation or acquires a majority of the stock of the Corporation. The services
to be performed by Employee hereunder are personal in nature and, therefore,
Employee shall not assign Employee’s rights or delegate Employee’s obligations
under this Agreement, and any attempted or purported assignment or delegation
not herein permitted shall be null and void.

14.           Successors. Subject to the provisions of paragraph 13, this
Agreement shall be binding upon and shall inure to the benefit of the
Corporation and Employee and their respective heirs, executors, administrators,
legal administrators, successors and assigns.

15.           Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been given if
delivered personally, by over-night courier, or by certified or registered mail,
return receipt requested, if to the Corporation, to:

Ronald S. Saks, President
LMI AEROSPACE, INC.
P.O. Box 900
St. Charles, MO 63302-0900

and, if to Employee, to:

Michael J. Biffignani
2643 Joyceridge
Chesterfield, MO 63017

or to such other address as may be specified by either of the parties in the
manner provided under this paragraph 14.

16.           Construction. This Agreement shall be deemed for all purposes to
have been made in the State of Missouri and shall be governed by and construed
in accordance with the laws of the State of Missouri, notwithstanding either the
place of execution hereof, nor the performance of any acts in connection
herewith or hereunder in any other jurisdiction.

17.           Venue. The parties hereto agree that any suit filed arising out of
or in connection with this Agreement shall be brought only in the United States
District Court for the Eastern District of Missouri, unless that court lacks
jurisdiction, in which case such action shall be brought only in the Circuit
Court for St. Louis County, Missouri.

18.           Disclosure of Existence of Agreement. To preserve the
Corporation’s rights under this Agreement, the Corporation may advise any third
party of the existence of this Agreement and its terms, and the Employee
specifically releases and agrees to indemnify and hold the Corporation harmless
from any liability for doing so.

19.           Opportunity to Review. Employee hereby represents and warrants
that Employee has had an opportunity to review this Agreement and ask the
Corporation questions about the Agreement, and understands the meaning and
effect of each paragraph of this Agreement.

The parties have executed this Agreement as of January 1, 2008.

   
LMI AEROSPACE, INC.
 
(“Corporation”)
     
By:
     
Ronald S. Saks, President
                 
Michael J. Biffignani
(“Employee”)