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                                                                  EXHIBIT 10(z)



                                        February 2, 1998


Mr. Mark M. Feldman
27 Hampton Road
Scarsdale, NY 10583

Dear Mark:

         This letter will memorialize the understanding between Lynch
Corporation and Mark M. Feldman (respectively, "Lynch" and Feldman";
collectively the "Parties") regarding the employment of Feldman by Lynch as
Executive Vice President - Corporate Development.  This letter accurately sets
forth the understanding of the Parties; upon its execution it will be a binding
contract between them.

I        Feldman will:

         A.      Report to the Chief Executive Officer of Lynch.

         B.      Be responsible for the implementation or effectuation of
                 transactions that were approved by Lynch that either may be
                 requested of him ("Delegated Transaction") or may be
                 identified, or otherwise originated, and introduced by him
                 ("Introduced Transaction").  Without intending to limit the
                 scope of any such transactions:

                 1.       Examples of Delegated Transactions are transactions
                          intended to rationalize the asset bases of Lynch and
                          its subsidiaries and affiliates (but excluding Mario
                          J. Gabelli and his affiliates), including, but not
                          limited to, effectuating sales, mergers equity
                          offering, or spin-offs of operations, acquisitions or
                          dispositions of individual assets, the raising of
                          capital for operating purposes, and any other
                          transaction that is not an Introduced Transaction;
                          and
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                 2.       Examples of Introduced Transactions are acquisitions
                          and investments for Lynch and its subsidiaries and
                          affiliates (but excluding Mario J. Gabelli and his
                          affiliates) and raising pools of investment capital
                          (i.e., where Lynch raises and manages investment
                          funds for third parties), that may be so identified,
                          or otherwise originated, and introduced by him.

         C.      Provide such other services as may be reasonably requested by
                 the Chief Executive Officer of Lynch that are consistent with
                 Feldman's background and training.

II       Lynch will:

         A.      Make Feldman a corporate officer with the title of Executive
                 Vice President - Corporate Development.

         B.      Pay Feldman an annual salary of $250,000, reimburse his
                 reasonable out-of-pocket expenses in accordance with company
                 policies, and provide him with such insurance, retirement, and
                 vacation benefits as are customarily provided by Lynch to its
                 senior officers.

         C.      Provide Feldman with twenty percent (20%) interests in the
                 future net gain or profits (after an allowance for Lynch's
                 customary return on capital for acquisitions and similar
                 investments) generated by all such Introduced Transactions
                 that are actually consummated.  The form and terms of each
                 such interest to be determined on a case-by-case basis
                 depending on the structure and characteristics of the
                 particular underlying transaction. Feldman shall not transfer
                 any such interests received, without Lynch's consent in the
                 sole discretion.  Any such interest shall not have any voting,
                 approval, election, inspection, fiduciary or other similar
                 ownership rights, except to the extent required by law, in
                 which case Feldman hereby grants to Lynch an irrevocable proxy
                 and power of attorney (which is coupled with an interest) to
                 exercise such rights as Lynch deems appropriate in its sole
                 discretion.  If, in Lynch's sole discretion, a Feldman
                 interest would adversely affect a transaction which Lynch
                 desires to undertake, Feldman shall be required to agree to do
                 with his interest what Lynch in its sole discretion
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                 elects.  Otherwise, Lynch shall have the right, upon notice to
                 Feldman, to acquire any such interest for cash at fair market
                 value.  If the parties are unable to agree on fair market
                 value, the determination of fair value shall be submitted to a
                 binding arbitration in accordance with the rules of the
                 American Arbitration Association;

         D.      Pay Feldman, at the sole discretion of Lynch, an annual bonus,
                 part of Lynch's management bonus pool, based on Feldman's
                 successful implementation or consummation of Designated
                 Transactions or for any reason determined solely by Lynch;

         E.      Provide Feldman with an office with his own Internet access
                 and computer in the corporate headquarters of Lynch in
                 Greenwich, Connecticut, or in Rye, New York.

III      The term of this agreement shall be from February 2, 1998, through
         December 31, 1999.  This agreement shall be terminable for cause at
         any time and it shall be terminable without cause after October 31,
         1998, on three months notice.  Upon termination, Feldman shall have
         the right to retain all equity interest earned herein as provided in
         paragraph IIC, above, and Lynch shall have the right to retain all
         pending Introduced Transactions, provided that (a) it shall elect such
         right in writing within thirty (30) days of Feldman's termination; and
         (b) it shall compensate Feldman in the manner described in paragraph
         IIC for any Introduced Transactions on which he spent substantial time
         prior to his termination and consummated within 6 months after
         termination on terms comparable to those discussed prior to
         termination of employment. Lynch shall have no other obligation to
         Feldman in connection with any termination of employment.

IV       As originally proposed by Lynch, Feldman shall be allowed to conduct
         his financial advisory business as long as it does not conflict with
         his obligations hereunder.  As originally proposed by Feldman, he will
         not undertake any significant new business without bringing it to the
         attention of Lynch.  Feldman presently is a director of Baron Asset
         Fund and SNL Securities, Inc., and he represents that there is not
         present conflict between either such directorship and the functions
         herein contemplated.  In the event that such a
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         conflict develops, however, Feldman will immediately resign the
         conflicting directorship.

Dated as of February 2, 1998.

Lynch Corporation                                Mark M. Feldman



By:                                              L/S:
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