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Exhibit 10.8.1  


 
 

LIQUIDITY SERVICES, INC.
  EXECUTIVE EMPLOYMENT AGREEMENT    
    



        THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is entered into as of November 11, 2005 with an effective
date of November 11, 2005 (the "Effective Date"), by and between Liquidity Services, Inc., a Delaware corporation
("LSI" or the "Company"), and James E. Williams (the  "Executive"). 


        1.    Employment Agreement.    On the terms and conditions set forth in this Agreement, the
Company agrees to employ the Executive and the Executive agrees to be employed by the Company for the Employment Period set forth in Section 2
hereof and in the position and with the duties set forth in Section 3 hereof. Terms used herein with initial capitalization are defined in  Section 10.12 below. 


        2.    Term.    The term of employment under this Agreement shall be the period set forth in  Schedule 1 attached hereto commencing on the Effective Date (the "Employment Period"). 



        3.    Position and Duties.    The Executive shall serve in the position and with the duties
and title set forth in Schedule 1 attached hereto during the Employment Period. In such capacity, the Executive shall have the normal duties,
responsibilities, and authority of such position, subject to the power of the Executive's "Reporting Officer" as designated in  Schedule 1, the
Company's Chairman of the Board of Directors (the "Board") or the Board to
reasonably expand or limit such duties, responsibilities and authority. The Executive shall report to the Reporting Officer designated in  Schedule 1. The Executive shall devote the Executive's best
efforts and full business time and attention to the business and affairs of the
Company; provided, however, that Executive may, to the extent such participation or service does not materially interfere with the performance of the
obligations described in this Agreement, (i) participate in charitable, civic, political, social, trade, or other non-profit organizations and (ii) with the consent of the
Board such consent not to be unreasonably withheld, serve as a non-management director of business corporations (or in a like capacity in other for-profit organizations). 



        4.    Place of Performance.    In connection with the Executive's employment by the Company,
the Executive shall be based at the principal executive offices of the Company, except as otherwise agreed by the Executive and the Company and except for reasonable travel on Company business. 


        5.    Compensation.    



        5.1.    Base Salary.    During the Employment Period, the Company shall pay to the Executive
an annual base salary (the "Base Salary"), which initially shall be at the rate per year as set forth in  Schedule 1. The Base Salary shall be payable
semi-monthly or in such other installments as shall be consistent with the Company's
payroll procedures. The Base Salary may be increased at any time or from time to time, but it may not be decreased without the consent of the Executive. 



        5.2    Bonus.    The Executive shall be eligible for a performance bonus as set forth in  Schedule 1. 


        5.3    Benefits.    During the Employment Period, the Executive will be entitled to receive
such other benefits approved by the Reporting Officer and made available to similarly situated senior executives of the Company, including health insurance, disability insurance, and 401-K
benefits. At all times the Company agrees to maintain Director's and Officer's Liability coverage for the Executive. Nothing contained in this Agreement shall prevent the Company from changing
insurance carriers. 


        5.4    Employee Leave.    The Executive shall be entitled to all public holidays observed by
the Company, a total of 26 days of paid time off in accordance with the applicable policies of the Company, which shall be taken at a reasonable time or times per year. 








 





        6.    Expenses.    The Executive is expected and is authorized to incur reasonable expenses in
the performance of his duties hereunder, including the costs of entertainment, travel, and similar business expenses incurred in the performance of his duties. Company shall reimburse the Executive
for all such expenses promptly upon periodic presentation by the Executive of an itemized account of such expenses and appropriate receipts. 


        7.    Termination of Employment.    



        7.1.    Termination.    The Executive's employment by the Company during the Employment Period
will continue until Executive's death, Disability, resignation or until Executive's termination by the Board at any time. 


        7.2.    Notice of Termination.    Any termination of the Executive's employment by the Company
or the Executive (other than because of the Executive's death) shall be communicated by written Notice of Termination to the other party hereto in accordance with  Section 10.1 hereof. For purposes
of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this Agreement relied upon, if any, and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis
for termination of the Executive's employment under the provision so indicated. Termination of the Executive's employment shall take effect on the Date of Termination. 




        8.    Compensation Upon Termination.    



        8.1.    Death.    If the Executive's employment is terminated during the Employment Period as
a result of the Executive's death, the Company shall pay to the Executive's estate, or as may be directed by the legal representatives of such estate, the Executive's full Base Salary through the next
full calendar month following the Date of Termination and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits
pursuant to Section 5.3 and expenses pursuant to Section 6. The payments contemplated by
this Section 8.1 shall be paid at the time they are due, and the Company shall have no further obligations to the Executive or his or her estate
under this Agreement. 


        8.2.    Disability.    If the Company terminates the Executive's employment during the
Employment Period because of the Executive's Disability, the Company shall pay the Executive the Executive's full Base Salary through the third full calendar month following the Date of Termination
and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to  Section 5.3 and expenses pursuant to
Section 6. The payments contemplated by this  Section 8.2 shall be paid at the time they are due, and the Company shall have no further
obligations to the Executive under this Agreement;
provided, however, that the Base Salary shall be reduced by the amount of any disability benefit payments made to the Executive during a period of
Disability from any insurance or other policies provided by the Company. 


        8.3.    By the Company with Cause or by the Executive without Good Reason.    If the Company
terminates the Executive's employment during the Employment Period for Cause or if the Executive voluntarily terminates the Executive's employment during the Employment Period other than for Good
Reason, the Company shall pay the Executive the Executive's full Base Salary through the Date of Termination and all other unpaid amounts, if any, to which Executive is entitled as of the Date of
Termination in connection with any fringe benefits pursuant to Section 5.3 and expenses pursuant to  Section 6. The
payments contemplated by this Section 8.3 shall be paid at the time such payments are due, and the Company shall have no further obligations to
the Executive under this Agreement. 


        8.4.    By the Company without Cause or by the Executive for Good Reason.    If the Company
terminates the Executive's employment during the Employment Period other than for Cause, 



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Death,
or Disability or the Executive terminates his employment during the Employment Period for Good Reason, the Company shall pay the Executive: (A) the Executive's full Base Salary through
the Date of Termination and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to  Section 5.2 and
expenses pursuant to Section 6; and (B) a lump-sum
severance package equal to one month of the Executive's Base Salary plus an amount equal to one month of the average annual bonus earned by the Executive for the previous two fiscal years
(collectively the "Severance Payment"). The Severance Payment under this Section 8.4 shall increase by two weeks for each year of employment
commencing 12 months after the Effective Date and shall be capped at six months. The Severance Payment shall be payable to the Executive within 30 days of the Notice of Termination. 




        9.    Other Agreements.    As a pre-condition to the effectiveness of this
Agreement, Executive agrees to execute the Employee Agreement attached hereto as Exhibit A (the "Employee
Agreement"), the terms and conditions of which are specifically incorporated herein by reference. 


        10.    Miscellaneous.    



        10.1.    Notices.    All notices, demands, requests or other communications required or
permitted to be given or made hereunder shall be in writing and shall be delivered, telecopied or mailed by first class registered or certified mail, postage prepaid, addressed as follows: 



        10.1.1.
If to the Company: 




Liquidity
Services, Inc.

2131 K Street NW, 4th Floor

Washington DC 20037

ATTN: William P. Angrick, III, Chairman and CEO

    Fax: (202) 467-4030

    Phone: (202) 558-6205 





        10.1.2.
If to the Executive: 




at
the address set forth in Schedule 1. 






or
to such other address as may be designated by either party in a notice to the other. Each notice, demand, request or other communication that shall be given or made in the manner described above
shall be deemed sufficiently given or made for all purposes three days after it is deposited in the U.S. mail, postage prepaid, or at such time as it is delivered to the addressee (with the return
receipt, the delivery receipt, the answer back, the confirmation (if telecopy) or the affidavit of messenger being deemed conclusive evidence of such delivery) or at such time as delivery is refused
by the addressee upon presentation. 


        10.2.    Representations.    Executive agrees to execute any proper oath or verify any proper
document required to carry out the terms of this Agreement. Executive represents that performance of all the terms of this Agreement and the Employee Agreement will not breach any
non-compete or similar agreement. Executive has not entered into, and Executive agrees not to enter into, any oral or written agreement in conflict herewith. 



        10.3.    Severability.    The invalidity or unenforceability of any one or more provisions of
this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect. 


        10.4.    Survival.    It is the express intention and agreement of the parties hereto that the
provisions of Section 8 hereof shall survive the termination of employment of the Executive. In 



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addition,
all obligations of the Company to make payments hereunder shall survive any termination of this Agreement on the terms and conditions set forth herein. 


        10.5.    Assignment.    The rights and obligations of the parties to this Agreement shall not
be assignable or delegable, except that (i) in the event of the Executive's death, the personal representative or legatees or distributees of the Executive's estate, as the case may be, shall
have the right to receive any amount owing and unpaid to the Executive hereunder and (ii) the rights and obligations of the Company hereunder shall be assignable and delegable to any Affiliate
of the Company or in connection with any subsequent merger, consolidation, sale of all or substantially all of the assets of the Company or similar reorganization of a successor corporation. 


        10.6.    Binding Effect.    Subject to any provisions hereof restricting assignment, this
Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal representatives, successors and
assigns. 


        10.7.    Amendment; Waiver.    This Agreement shall not be amended, altered or modified except
by an instrument in writing duly executed by the parties hereto; provided, that the parties may amend Schedule 1 hereto by executing and
delivering a revised version of Schedule 1 and attaching such revised version to this Agreement. Neither the waiver by either of the parties
hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure of either of the parties, on one or more occasions, to enforce any of the provisions of this Agreement
or to exercise any right or privilege hereunder, shall thereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any such provisions, rights or
privileges hereunder. 


        10.8.    Headings.    Section and subsection headings contained in this Agreement are inserted
for convenience of reference only, shall not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the
provisions hereof. 


        10.9.    Governing Law.    This Agreement, the rights and obligations of the parties hereto,
and any claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the District of Columbia not including the choice of law rules thereof. 


        10.10.    Entire Agreement.    This Agreement, including  Schedule 1 hereto and the Employee
Agreement, constitute the entire agreement between the parties respecting the employment of Executive, there
being no representations, warranties or commitments except as set forth herein. 


        10.11    Counterparts.    This Agreement may be executed in two or more counterparts, each of
which shall be an original and all of which shall be deemed to constitute one and the same instrument. 


        10.12.    Definitions.    



        "Affiliate" means as to a specified Person any other person that directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, the specified Person. 


        "Agreement" means this Executive Employment Agreement. 


        "Base Salary" is defined in Section 5.1 above. 



        "Beneficial Owner" means a beneficial owner within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934,
as amended. 


        "Cause" means (i) the commission of a felony or a crime involving moral turpitude (specifically excluding felonies or crimes under
any applicable state or federal vehicle code) or the 



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commission
of any other act or omission involving dishonesty or fraud with respect to the Company or any of its Subsidiaries or any of their customers or suppliers, or (ii) recurring violations
of material Company rules, regulations policies or any material provisions of this Agreement (which are not inconsistent with or in violation of any of the provisions of this Agreement) after written
notice to Executive from the Company specifically enumerating all of the facts and circumstances constituting the violation, the conduct or action which can be taken by Executive to cure the
violation, and a reasonable opportunity for Executive to take corrective action, or (iii) gross negligence or willful misconduct with respect to the Company or any of its Subsidiaries. 



        "Company" means Liquidity Services, Inc. and its successors and assigns. 


        "Date of Termination" means (i) if the Executive's employment is terminated by the Executive's death, the date of the Executive's
death; (ii) if the Executive's employment is terminated because of the Executive's Disability, 30 days after Notice of Termination; (iii) if the Executive's employment is
terminated by the Company for Cause or by the Executive for Good Reason, the date specified in the Notice of Termination; or (iv) if the Executive's employment is terminated during the
Employment Period other than pursuant to Section 7.1, the date on which Notice of Termination is given. 


        "Disability" means the Executive's inability to perform all of the Executive's duties hereunder by reason of illness, physical or mental
disability or other similar incapacity, as determined by a competent medical doctor appointed by the Reporting Officer after a complete and thorough medical examination and evaluation, which inability
shall continue for more than three consecutive months or for such shorter periods that when aggregated exceed six (6) months in any twelve (12) month period. 



        "Effective Date" means the date as of which this Agreement is executed as set out above. 


        "Employee Agreement" is defined in Section 9 above. 


        "Employment Period" is defined in Section 2 above. 


        "Good Reason" means (i) the Company's failure to perform or observe any of the material terms or provisions of this Agreement
(including the provisions of Schedule 1) or the Employee Agreement, and the continued failure of the Company to cure such default within 30 days after written demand for performance has
been given to the Company by the Executive, which demand shall describe specifically the nature of such alleged failure to perform or observe such material terms or provisions; or (ii) a
material reduction in the scope of the Executive's responsibilities and duties without the written consent of Executive; or (iii) any change to the job title given to Executive without his
written consent; (iv) any reduction in Base Salary or any other benefits provided to Executive hereunder; or (v) any constructive termination of Executive; (vi) any request,
instruction, directive or order, whether direct or indirect, to Executive by the Board, the Company or any executive officer of the Company to perform any act which is unlawful; or (vii) a
requirement by the Company for the Executive to relocate outside of the Washington DC metropolitan region to retain his position without the written consent of the Executive. 


        "Notice of Termination" is defined in Section 7.2 above. 


        "Person" means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. 



        "Severance Payments" is defined in Section 8.4 above. 



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        IN
WITNESS WHEREOF, the undersigned have duly executed this Agreement, or have caused this Agreement to be duly executed on their behalf, as of the day and year first hereinabove
written. 



	 
	 	 
	 	 

	 	 	LIQUIDITY SERVICES, INC.
	

 	
 	

By:	
 	

 
	 	 	 	 	/s/  WILLIAM P. ANGRICK, III      
 William P. Angrick, III

Chairman and CEO
	

 	
 	

EXECUTIVE:
	

 	
 	

/s/  JAMES E. WILLIAMS      
 James E. Williams




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SCHEDULE 1

CERTAIN TERMS OF EMPLOYMENT  


All capitalized but undefined terms in this Schedule shall have the meaning ascribed to them in the Agreement.


Name:
James E. Williams 



Position/Title:
Vice President, General Counsel and Secretary 


Duties:
You will be responsible for supervising and managing LSI's legal, regulatory and compliance activities. As a member of the Company's senior management team you will work closely with LSI's
President/COO, Chief Financial Officer and business unit heads regarding key decisions involving operating policy and corporate development. Specific responsibilities are summarized below. 


	A.
	Supervise
and manage all legal affairs for the LSI organization, including but not limited to regulatory compliance, commercial contracts, securities filings, insurance matters, human
resources matters and disputes with third parties, to protect the Company's interests;



	B.
	Supervise
and manage the Company's relationship with its outside counsel Hogan & Hartson, LLP and/or any other outside counsel retained by the Company to ensure quality control
and efficiencies;



	C.
	Interface
with the Company's Board and special committees as necessary to provide advice regarding legal and regulatory affairs, including but not limited to public company legal
compliance and disclosure matters;



	D.
	Serve
in the role of Corporate Secretary and maintain all appropriate documentation in the corporate record book;



	E.
	Support
the Company's capital raising activities and communications with interested parties, such as shareholders, investors and analysts, to comply with all relevant regulatory
requirements;



	F.
	Support
and review all regulatory filings and disclosures associated with public company status;



	G.
	Manage
and approve all insurance plans to mitigate company risk, including Directors and Officers liability, property and casualty policies;



	H.
	Serve
as chief compliance officer with respect to employer-employee matters, investor relations, and proper documentation of all corporate contracts and business relationships;



	I.
	Promote
effective intellectual property documentation and systems to protect and enhance the intellectual property assets of the Company;



	J.
	Support
the Company's development of business monitors, controls and documentation as appropriate to ensure the Company becomes compliant, and maintains compliance, with Sarbanes Oxley
requirements;



	K.
	Support
the evaluation, due diligence, documentation and closing process for Company acquisitions, joint ventures and overall corporate development;



	L.
	Maintain
financial discipline across LSI through cost analysis, expense controls and risk management techniques related to legal and regulatory affairs. 



Employment
Term: Three Years from the Effective Date 


Reporting
Officer: Chairman and CEO 


Base
Salary: $160,000 per annum 


Bonus:
Executive shall be eligible for an annual incentive bonus one year from the Effective Date up to 33% of his Base Salary based upon the achievement of certain deliverables or goals as agreed to
by the Executive and the Reporting Officer. These deliverables or goals will be agreed upon and approved by 










the
Board's Compensation Committee within 30 days of the Effective Date and prior to the start of each annual period. The Board's Compensation Committee reserves the right to award a
discretionary bonus based on the Executive's performance and contributions. 


Equity
Based Compensation: Executive will receive options to purchase 55,000 shares of the Company's common stock (the "Common Stock") at a purchase
price (the "Purchase Price") per common share of $7.00 (the "Options"). The Options will be granted at
the Company's next regularly scheduled Board meeting of December 2, 2005 pursuant to a stock option agreement based on the Company's standard form for its executives and subject to the
Company's Stock Option and Incentive Plan. The Options will vest as follows: 25% after the first anniversary of your employment and, thereafter, monthly vesting for the following 36 months.
These Options will fully vest in the event the Executive is terminated without Cause (as defined under this Agreement) following a change in control of the Company. 


Notice
Address: 


Current:



James
E. Williams

2232 North Kentucky Street

Arlington, VA 22205 



	 
	 	 

	COMPANY	 	EXECUTIVE:
	

/s/  WILLIAM P. ANGRICK, III      
 William P. Angrick, III

Chairman and CEO	
 	

/s/  JAMES E. WILLIAMS      
 James E. Williams













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LIQUIDITY SERVICES, INC. EXECUTIVE EMPLOYMENT AGREEMENT