Document:

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                                                                   EXHIBIT 10(L)

                          UNITED INDUSTRIAL CORPORATION
                              EMPLOYMENT AGREEMENT
                                 R. W. WORTHING

             AGREEMENT made this 3rd day of March 2000, by and between UNITED
INDUSTRIAL CORPORATION, a Delaware corporation having an address 570 Lexington
Avenue, New York, New York 10022 (hereinafter called "Employer"), and ROBERT W.
WORTHING, having an address at 16326 Matthews Road, Monkton, Maryland 21111
(hereinafter called "Employee").

                              W I T N E S S E T H:

             In consideration of the mutual covenants hereinafter contained, the
parties hereto agree as follows:

             1. EMPLOYMENT. Employer agrees to employ Employee and Employee
agrees to serve Employer upon the terms and conditions hereinafter set forth.

             2. TERM. The term of this Agreement shall commence January 3, 2000,
(the "Effective Date") and subject to the provisions of Sections 3,4, and 10,
hereof, terminate as of the close of business at the date three (3) years after
the Effective Date (the "Termination Date"). The period from the Effective Date
through the Termination Date is referred to as the term of this Agreement.

             3. DUTIES AND EXTENT OF SERVICES. Employee agrees to serve Employer
and its subsidiary companies faithfully and to the best of his ability under the
direction of the Board of Directors and President of Employer, devoting his
entire business time, energy and skill to his duties hereunder. The principal
place of employment of Employee shall be at the offices of Employer currently
located at Industry Lane in Hunt Valley, Maryland. Employee understands and
agrees, however, that in connection with his employment hereunder, he may be
required from time to time to travel on behalf of Employer. If the principal
place of employment of the Employee shall change prior to the Termination Date
because of a change in Employer's or AAI Corporation's offices to a location
which is more than 50 miles from the offices presently located at Industry Lane,
the Employee shall have the option within 30 days after such change to terminate
this Agreement by sending written notice of termination to Employer, and
thereupon his employment pursuant to this Agreement shall terminate and Employee
shall be entitled to no further payments hereunder, other than (i) for any
compensation due pursuant to Section 4 and (ii) the reimbursements pursuant to
Section 9 hereof, of any expenses incurred prior to the date of such
termination.

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                The principal duties of Employee shall be to serve as Vice
President and General Counsel of Employer and, in such capacity, to render such
managerial, administrative and other services to Employer and its subsidiaries
as normally are associated with and incident to such positions as Employer from
time to time may require of him. If, during the term of this Agreement, the
Board of Directors of Employer so determines, in its absolute discretion, to
elect Employee to any additional office of Employer or its subsidiary companies
consistent with his position, or a director of its subsidiary companies,
Employee agrees to accept and serve in such office or capacity for no additional
compensation or remuneration.

             4. COMPENSATION.

                (a)  CASH COMPENSATION. Employer agrees to pay to Employee, as
compensation for all of the services to be rendered by Employee under or
pursuant to this Agreement, compensation as follows.

                     (i)   Employee shall receive as compensation for his
services hereunder an annual salary ("Base Compensation") of $220,043.00, which
sum shall be payable in accordance with the normal payroll practices of
Employer. Employee shall be reviewed annually and shall be entitled to such
increases in his Base Compensation as the Board of Directors may determine,
considering the recommendation of the President and Chief Executive Officer.

                     (ii)  Employee shall also be entitled to participate in
Employer's Performance Sharing Plan ("PSP"; or such other similar bonus or
incentive plan approved by Employer's Board of Directors and its Compensation
Committee), that will afford Employee an opportunity to earn incentive
compensation equivalent to a sum derived using at least the same target
incentive percentage (40%) as used under the 1999 plan. The plan shall be based
upon meeting certain goals and benchmarks. In its discretion, the Board of
Directors may award Employee such greater sum as it may determine.

                     (iii) Such salary and incentive shall be subject to annual
review by Employer's Board of Directors and, at the discretion of the Board, may
be increased, but not decreased below such amount and the incentive shall be not
less than the sum resulting under the PSP process.

                     (iv)  If Employee's employment terminates due to any reason
other than "for cause," including Employee's voluntary termination, prior to the
end of the Compensation Year, Employee shall be entitled to an incentive
compensation award at least equal to the sum calculated for his base salary in
accordance with the PSP, but pro rata to the number of days employed

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during the Compensation Year. If Employee's employment is terminated "for
cause" prior to the time that the Earned Incentive Compensation is approved
by the Employer's Board of Directors for employees of Employer generally,
Employee shall not be entitled to any incentive compensation.

                     (v)   If during the term of this Agreement, or if this
Agreement is not renewed or superceded, after the term of this Agreement,
Employee's employment ceases for any reason other than "for cause," death, or
Employee's voluntary departure (other than for "Good Reason" as defined below),
the Employee shall be entitled, in addition to the compensation provided for
above, to a sum equivalent to not less than his "Base Severance Compensation"
that is a sum equal to one hundred fifty percent (150%) of Employee's annualized
salary plus an Incentive Compensation Award equal to forty-two percent (42%) of
the 150% annualized salary, payable in accordance with the normal payroll
practices of Employer over a period of eighteen months following cessation of
employment. If the date employment ceases is prior to the last eighteen (18)
months of the term of this Agreement, the Employee shall be compensated for the
remainder of this Agreement at his annualized salary plus an Incentive
Compensation Award equal to the sum calculated for his base salary in accordance
with the PSP or, if more, the amount provided for under the "Base Severance
Compensation." Under the circumstances above, any and all stock options awarded
to Employee that have not expired by the terms of each grant shall fully vest
for purposes of each such grant.

                           For purposes hereof, "Good Reason" shall mean any

of the following, unless consented to by Employee in writing:

                           (a) a termination by Employee pursuant to Section 3
hereof;

                           (b) the assignment to Employee of any duties
materially inconsistent with Employee's position as set forth in Section 3
hereof, Employee's removal from such position or a substantial diminution in
such position, duties or responsibilities, which is not remedied by Employer
within ten days after receipt of written notice thereof from Employee;

                           (c) a reduction in Employer's compensation pursuant
to Sections 4(a) (i) and (ii) hereof as in effect on the date hereof or as
increased from time to time; or

                           (d) a failure of Employer to continue to provide
Employee with benefits substantially as contemplated by Section 4(b) hereof.

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                   (b) EMPLOYEE BENEFIT PLANS. During the term of this
Agreement, Employee shall be eligible to participate in any life insurance,
medical, retirement, pension or profit-sharing, disability or other benefit
plans or arrangements now or hereafter generally made available by Employer to
executive employees of Employer to the extent Employee qualifies under the
provisions of any such plans. Subject to the foregoing, Employer shall have the
right to change insurance companies and modify insurance policies covering
employees of Employer. In addition, notwithstanding any provision herein to the
contrary, Employee shall be entitled to continuation of the same or equivalent
benefits during the months following cessation of employment so long as Employee
is entitled to payments pursuant to Section 4 hereof.

                   (c) AUTOMOBILE ALLOWANCE. Employer shall pay to Employee an
automobile allowance of ten thousand dollars ($10,000) per annum, commencing as
of the Effective Date, payable in accordance with Employer's normal payroll
practices.

                   (d) VACATION. Employee shall be entitled to four (4) weeks
 vacation with pay per year.

                   (e) TAXES. Employee understands that any and all payments
described in this Agreement will be subject to such tax treatment as applies
thereto, and to such withholding as may be required under applicable tax laws.

             5. NO COMPETITION. Employee agrees that during the term of this
Agreement he will not, within the continental United States, directly or
indirectly, engage or participate or make any financial investments in or become
employed by or render advisory or other services to or for any person, firm or
corporation, or in connection with any business activity, other than that of
Employer and its subsidiary companies, directly or indirectly in competition
with any of the business operations or activities of Employer and its subsidiary
companies. Nothing herein contained, however, shall restrict Employee from
making any investments in any company whose stock is listed on a national
securities exchange or actively traded in the over-the-counter market, so long
as such investment does not give him the right to control or influence the
policy decisions of any such business or enterprise which is or might be
directly or indirectly in competition with any of such business operations or
activities of Employer or any of its subsidiary companies.

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             6. CONFIDENTIALITY; ETC.

                (a)  Employee will not divulge, furnish or make accessible to
anyone (other than in the regular course of business of Employer or any of its
subsidiary companies) any knowledge or information with respect to confidential
or secret methods, processes, plans or materials of Employer or any of its
subsidiary companies, or with respect to any other confidential or secret
aspects of the business of Employer or any of its subsidiary companies.

                (b)  Employee agrees to communicate and to make known to
Employer all knowledge possessed by him relating to any methods, developments,
inventions and/or improvements, whether patented, patentable or unpatentable
which concerns in any way the business of Employer or any of its subsidiary
companies or the general industry of which they are a part, from the time of
entering upon employment until the termination thereof, and whether acquired by
Employee before or during the term of his employment; PROVIDED, HOWEVER, that
nothing herein shall be construed as requiring any such communication where the
method, development, invention and/or improvement is lawfully protected from
disclosure as the trade secret of a third party, including, without limitation,
any former employer of Employee or by any other lawful bar to such
communication.

                (c)  Any methods, developments, inventions and/or improvements,
whether patentable or unpatentable, along the lines of the business of Employer
or any of its subsidiary companies, which Employee may conceive of or make while
in the employ of Employer, shall be and remain the property of Employer.
Employee agrees promptly to communicate and disclose all such methods,
developments, inventions and/or improvements to Employer and to execute and
deliver to Employer any instruments deemed necessary by Employer to effect
disclosure and assignment thereof to it. Employee further agrees, on request of
Employer, to execute patent applications based on such methods, developments,
inventions and/or improvements, including any other instruments deemed necessary
by Employer for the prosecution of such patent applications or the acquisition
of Letters Patent in the United States and/or any foreign countries.

                (d)  Employee agrees that for a period of two (2) years from and
after the termination or expiration of his employment by Employer, whether
pursuant to the terms of this Agreement or otherwise, he will not:

                         (i)   directly or indirectly solicit, raid, entice or
induce any employee of Employer or of any of its subsidiary companies to be
employed

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by any person, firm or corporation which is, directly or indirectly, in
competition with the business or activities of Employer or any of its subsidiary
companies; or

                         (ii)  directly or indirectly approach any such employee
for these purposes; or

                         (iii) authorize or knowingly approve the taking of such
actions by other persons on behalf of any such person, firm or corporation, or
assist any such person, firm or corporation in taking such action; or

                         (iv)  directly or indirectly solicit, raid, entice or
induce any person, firm or corporation (other than the U.S. Government or its
agencies) who or which on the date hereof is, or at any time during the period
of employment hereunder shall be, a customer of Employer or of any of its
subsidiary companies to become a customer for the same or similar products which
it purchased from Employer or any of its subsidiary companies, of any other
person, firm or corporation, and Employee shall, not approach any such customer
for such purpose or authorize or knowingly approve the taking of such actions by
any other person.

                (e)  Employee agrees that during the term of his employment by
Employer, whether under this Agreement or otherwise, he will not at any time
enter into, on behalf of Employer or any of its subsidiary companies, or cause
Employer or any of its subsidiary companies to enter into, directly or
indirectly, any transactions with any business organization in which he or any
member of his immediate family may be interested as a partner, trustee,
director, officer, employee, shareholder, lender of money or guarantor.

            7.  INJUNCTIVE RELIEF. Employee acknowledges that the services to be
rendered by him hereunder are of a special, unique and extraordinary character
and that it would be very difficult or impossible to replace such services and
further that irreparable injury would be sustained by Employer and its
subsidiary companies in the event of a violation by Employee of any of the
provisions of this Agreement, and by reason thereof Employee consents and agrees
that if he violates any of the provisions of this Agreement, Employer shall be
entitled to an injunction to be issued by any court of competent jurisdiction
restraining him from committing or continuing any violation of this Agreement.

            8.  SURVIVAL OF PROVISIONS. The provisions of Sections 4, 5, 6, 7,
and 10 hereof shall survive the termination or expiration of this Agreement,
irrespective of the reason therefor.

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            9.  EXPENSES. Employer shall reimburse Employee for all reasonable
expenses incurred by him on behalf of Employer in the performance of his duties
hereunder, provided that proper vouchers are submitted to Employer by Employee
evidencing such expenses and the purposes for which the same were incurred.

            10. DISABILITY. If Employee shall be incapacitated by reason of
mental or physical disability or otherwise during the term of this Agreement so
that he is prevented from performing his principal duties and services hereunder
for a period of three (3) consecutive months or one or more periods aggregating
three (3) months during any twelve (12) month period, Employer shall have the
right to terminate this Agreement by sending written notice of termination to
Employee, and thereupon his employment pursuant to this Agreement shall
terminate and Employee shall be entitled to no further payments hereunder, other
than (i) for any compensation due pursuant to Section 4 (a)(i),(iv) and (v)
hereof, and (ii) the reimbursement, pursuant to Section 9 hereof, of any
expenses incurred prior to the date of such termination. For purposes of this
Section 10, amounts payable under subsection (i) hereof shall be inclusive of
amounts paid to Employee in lieu of normal cash compensation under Employer
sponsored Short Term and Long Term Disability Insurance policies during the
eighteen months following cessation of employment. In other words, Employer will
pay only that amount in excess of the insurance payments made each month that is
necessary to provide Employee with cash compensation equal to what would have
been paid pursuant to Section 4 but for the insurance payments.

            11. DEATH. In the event of the death of Employee during the term
hereof, this Agreement shall automatically terminate and Employer shall have no
further obligations hereunder, other than to pay to Employee's estate any
compensation due pursuant to Section 4 (a)(i) and (iv) hereof through the date
of such termination and to reimburse, pursuant to Section 9 hereof, any expenses
incurred by Employee through the date of such termination.

            12. TERMINATION BY EMPLOYER FOR CAUSE. Employer shall have the right
to terminate the employment of Employee under this Agreement as well as any and
all payments to be made hereunder, other than for any compensation due pursuant
to Section 4 (a)(i) hereof through the date of such termination and any
reimbursement, pursuant to Section 9 hereof, of expenses incurred by Employee
through the date of such termination, if Employee shall commit any of the
following acts of default:

                   (a) Employee shall have committed any material breach of any
of the provisions or covenants set forth herein; or

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                   (b) Employee shall have committed any act of gross negligence
in the performance of his duties or obligations hereunder; or

                   (c) Employee shall have committed any material act of
dishonesty or breach of trust against Employer or any of its subsidiary
companies; or

                   (d) Employee's conviction of, or plea of NOLO CONTENDERE to,
a felony.

             If Employer elects to terminate this Agreement as set forth above,
Employer shall send written notice to Employee terminating this Agreement and
describing the action of Employee constituting the act of default, and thereupon
no further payments of any type shall be made or shall be payable to Employee
hereunder notwithstanding any other provisions of this Agreement, except as set
forth in the first sentence of this Section 12.

             13. NO CONFLICTING AGREEMENTS. Employee represents and warrants
that he is not a party to any agreement, contract or understanding, whether
employment or otherwise, which would in any way restrict or prohibit him from
undertaking or performing employment in accordance with the terms and conditions
of this Agreement.

             14. ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof, and no
statement, representation, warranty or covenant has been made by either party
except as expressly set forth herein. This Agreement shall not be changed or
terminated orally. This Agreement supersedes and cancels all prior agreements
between the parties, or any subsidiary of Employer whether written or oral,
relating to the employment of Employee.

             15. APPLICABLE LAW. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the State of New York, without
regard to its conflict of laws principles.

             16. NOTICES. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered, telecopied or mailed, first class, postage
prepaid, certified mail, return receipt requested, to each of the parties at its
or his address above written or as set forth beneath their signatures below or
at such other address or telecopy number as either of the parties may designate
in conformity with the foregoing.

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             17. SECTION HEADINGS. The Section headings set forth in this
Agreement are for convenience only and shall not be considered as part of this
Agreement in any respect nor shall they in any way affect the substance of any
provisions contained in this Agreement.

             18. SUCCESSORS AND ASSIGNS. This Agreement shall not be assignable
by Employee. All of the terms and provisions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective heirs and
personal representatives of Employee and the successors and assigns of Employer.

             19. SEVERABILITY. If, at any time subsequent to the date hereof,
any provision of this Agreement shall be held by any court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall be of no
force and effect, but the illegality or unenforceability of such provision shall
have no effect upon and shall not impair the enforceability of any other
provisions of this Agreement.

             IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

UNITED INDUSTRIAL CORPORATION                   EMPLOYEE

By:    /s/ Richard R. Erkeneff                  /s/ Robert W. Worthing
       -----------------------                  ----------------------
       Richard R. Erkeneff                      Robert W. Worthing
       President & CEO                          Fax: (410) 472-0851
       Fax No.: (212) 838-4629

                                       9<PAGE>

                                                                   EXHIBIT 10(M)

                          UNITED INDUSTRIAL CORPORATION
                              EMPLOYMENT AGREEMENT
                                   J. H. PERRY

             AGREEMENT made this 3rd day of March, 2000, by and between UNITED
INDUSTRIAL CORPORATION, a Delaware corporation having an address 570 Lexington
Avenue, New York, New York 10022 (hereinafter called "Employer"), and JAMES H.
PERRY, having an address at 8 Carolyn Court, Owings Mills, Maryland 21117
(hereinafter called "Employee").

                              W I T N E S S E T H:

             In consideration of the mutual covenants hereinafter contained, the
parties hereto agree as follows:

             1.   EMPLOYMENT.  Employer agrees to employ Employee and Employee
agrees to serve Employer upon the terms and conditions hereinafter set forth.

             2.   TERM. The term of this Agreement shall commence January 3,
2000 (the "Effective Date") and subject to the provisions of Sections 3,4,and 10
hereof, terminate as of the close of business at the date three (3) years after
the Effective Date (the "Termination Date"). The period from the Effective Date
through the Termination Date is referred to as the term of this Agreement.

             3.   DUTIES AND EXTENT OF SERVICES. Employee agrees to serve
Employer and its subsidiary companies faithfully and to the best of his ability
under the direction of the Board of Directors and President of Employer,
devoting his entire business time, energy and skill to his duties hereunder. The
principal place of employment of Employee shall be at the offices of Employer
currently located at Industry Lane in Hunt Valley, Maryland. Employee
understands and agrees, however, that in connection with his employment
hereunder, he may be required from time to time to travel on behalf of Employer.
If the principal place of employment of the Employee shall change prior to the
Termination Date because of a change in Employer's or AAI Corporation's offices
to a location which is more than 50 miles from the offices presently located at
Industry Lane, the Employee shall have the option within 30 days after such
change to terminate this Agreement by sending written notice of termination to
Employer, and thereupon his employment pursuant to this Agreement shall
terminate and Employee shall be entitled to no further payments hereunder, other
than (i) for any compensation due pursuant to Section 4 and (ii) the
reimbursements pursuant to Section 9 hereof, of any expenses incurred prior to
the date of such termination.

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                  The principal duties of Employee shall be to serve as Vice
President and Chief Financial Officer of Employer and, in such capacity, to
render such managerial, administrative and other services to Employer and its
subsidiaries as normally are associated with and incident to such positions as
Employer from time to time may require of him. If, during the term of this
Agreement, the Board of Directors of Employer so determines, in its absolute
discretion, to elect Employee to any additional office of Employer or its
subsidiary companies consistent with his position, or a director of its
subsidiary companies, Employee agrees to accept and serve in such office or
capacity for no additional compensation or remuneration.

             4.   COMPENSATION.

                  (a)  CASH COMPENSATION. Employer agrees to pay to Employee, as
compensation for all of the services to be rendered by Employee under or
pursuant to this Agreement, compensation as follows.

                       (i)   Employee shall receive as compensation for his
services hereunder an annual salary ("Base Compensation") of $200,720.00, which
sum shall be payable in accordance with the normal payroll practices of
Employer. Employee shall be reviewed annually and shall be entitled to such
increases in his Base Compensation as the Board of Directors may determine,
considering the recommendation of the President and Chief Executive Officer.

                       (ii)  Employee shall also be entitled to participate in
Employer's Performance Sharing Plan ("PSP"; or such other similar bonus or
incentive plan approved by Employer's Board of Directors and its Compensation
Committee), that will afford Employee an opportunity to earn incentive
compensation equivalent to a sum derived using at least the same target
incentive percentage (40%) as used under the 1999 plan). The plan shall be based
upon meeting certain goals and benchmarks. In its discretion, the Board of
Directors may award Employee such greater sum as it may determine.

                       (iii) Such salary and incentive shall be subject to
annual review by Employer's Board of Directors and, at the discretion of the
Board, may be increased, but not decreased below such amount and the incentive
shall be not less than the sum resulting under the PSP process.

                       (iv)  If Employee's employment terminates due to any
reason other than "for cause," including Employee's voluntary termination, prior
to the end of the Compensation Year, Employee shall be entitled to an incentive
compensation award at least equal to the sum calculated for his base salary in
accordance with the PSP, but pro rata to the number of days employed

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during the Compensation Year. If Employee's employment is terminated "for cause"
prior to the time that the Earned Incentive Compensation is approved by the
Employer's Board of Directors for employees of Employer generally, Employee
shall not be entitled to any incentive compensation.

                       (v)   If during the term of this Agreement, or if this
Agreement is not renewed or superceded, after the term of this Agreement,
Employee's employment ceases for any reason other than "for cause," death, or
Employee's voluntary departure (other than for "Good Reason" as defined below),
the Employee shall be entitled, in addition to the compensation provided for
above, to a sum equivalent to not less than his "Base Severance Compensation"
that is a sum equal to one hundred fifty percent (150%) of Employee's annualized
salary plus an Incentive Compensation Award equal to thirty-five percent (35%)
of the 150% annualized salary, payable in accordance with the normal payroll
practices of Employer over a period of eighteen months following cessation of
employment. If the date employment ceases is prior to the last eighteen (18)
months of the term of this Agreement, the Employee shall be compensated for the
remainder of this Agreement at his annualized salary plus an Incentive
Compensation Award equal to the sum calculated for his base salary in accordance
with the PSP or, if more, the amount provided for under the "Base Severance
Compensation." Under the circumstances above, any and all stock options awarded
to Employee that have not expired by the terms of each grant shall fully vest
for purposes of each such grant.

                             For purposes hereof, "Good Reason" shall mean any
of the following, unless consented to by Employee in writing:

                             (a) a termination by Employee pursuant to Section 3
hereof;

                             (b) the assignment to Employee of any duties
materially inconsistent with Employee's position as set forth in Section 3
hereof, Employee's removal from such position or a substantial diminution in
such position, duties or responsibilities, which is not remedied by Employer
within ten days after receipt of written notice thereof from Employee;

                             (c) a reduction in Employer's compensation pursuant
to Sections 4(a) (i) and (ii) hereof as in effect on the date hereof or as
increased from time to time; or

                             (d) a failure of Employer to continue to provide
Employee with benefits substantially as contemplated by Section 4(b) hereof.

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                  (b)  EMPLOYEE BENEFIT PLANS. During the term of this
Agreement, Employee shall be eligible to participate in any life insurance,
medical, retirement, pension or profit-sharing, disability or other benefit
plans or arrangements now or hereafter generally made available by Employer to
executive employees of Employer to the extent Employee qualifies under the
provisions of any such plans. Subject to the foregoing, Employer shall have the
right to change insurance companies and modify insurance policies covering
employees of Employer. In addition, notwithstanding any provision herein to the
contrary, Employee shall be entitled to continuation of the same or equivalent
benefits during the months following cessation of employment so long as Employee
is entitled to payments pursuant to Section 4 hereof.

                  (c)  AUTOMOBILE ALLOWANCE. Employer shall pay to Employee an
automobile allowance of ten thousand dollars ($10,000) per annum, commencing as
of the Effective Date, payable in accordance with Employer's normal payroll
practices.

                  (d)  VACATION. Employee shall be entitled to four (4) weeks
vacation with pay per year.

                  (e)  TAXES. Employee understands that any and all payments
described in this Agreement will be subject to such tax treatment as applies
thereto, and to such withholding as may be required under applicable tax laws.

             5.   NO COMPETITION. Employee agrees that during the term of this
Agreement he will not, within the continental United States, directly or
indirectly, engage or participate or make any financial investments in or become
employed by or render advisory or other services to or for any person, firm or
corporation, or in connection with any business activity, other than that of
Employer and its subsidiary companies, directly or indirectly in competition
with any of the business operations or activities of Employer and its subsidiary
companies. Nothing herein contained, however, shall restrict Employee from
making any investments in any company whose stock is listed on a national
securities exchange or actively traded in the over-the-counter market, so long
as such investment does not give him the right to control or influence the
policy decisions of any such business or enterprise which is or might be
directly or indirectly in competition with any of such business operations or
activities of Employer or any of its subsidiary companies.

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             6.   CONFIDENTIALITY; ETC.

                  (a)  Employee will not divulge, furnish or make accessible to
anyone (other than in the regular course of business of Employer or any of its
subsidiary companies) any knowledge or information with respect to confidential
or secret methods, processes, plans or materials of Employer or any of its
subsidiary companies, or with respect to any other confidential or secret
aspects of the business of Employer or any of its subsidiary companies.

                  (b)  Employee agrees to communicate and to make known to
Employer all knowledge possessed by him relating to any methods, developments,
inventions and/or improvements, whether patented, patentable or unpatentable
which concerns in any way the business of Employer or any of its subsidiary
companies or the general industry of which they are a part, from the time of
entering upon employment until the termination thereof, and whether acquired by
Employee before or during the term of his employment; PROVIDED, HOWEVER, that
nothing herein shall be construed as requiring any such communication where the
method, development, invention and/or improvement is lawfully protected from
disclosure as the trade secret of a third party, including, without limitation,
any former employer of Employee or by any other lawful bar to such
communication.

                  (c)  Any methods, developments, inventions and/or
improvements, whether patentable or unpatentable, along the lines of the
business of Employer or any of its subsidiary companies, which Employee may
conceive of or make while in the employ of Employer, shall be and remain the
property of Employer. Employee agrees promptly to communicate and disclose all
such methods, developments, inventions and/or improvements to Employer and to
execute and deliver to Employer any instruments deemed necessary by Employer to
effect disclosure and assignment thereof to it. Employee further agrees, on
request of Employer, to execute patent applications based on such methods,
developments, inventions and/or improvements, including any other instruments
deemed necessary by Employer for the prosecution of such patent applications or
the acquisition of Letters Patent in the United States and/or any foreign
countries.

                  (d)  Employee agrees that for a period of two (2) years from
and after the termination or expiration of his employment by Employer, whether
pursuant to the terms of this Agreement or otherwise, he will not:

                       (i) directly or indirectly solicit, raid, entice or
induce any employee of Employer or of any of its subsidiary companies to be
employed

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by any person, firm or corporation which is, directly or indirectly, in
competition with the business or activities of Employer or any of its subsidiary
companies; or

                       (ii) directly or indirectly approach any such employee
for these purposes; or

                       (iii) authorize or knowingly approve the taking of such
actions by other persons on behalf of any such person, firm or corporation, or
assist any such person, firm or corporation in taking such action; or

                       (iv) directly or indirectly solicit, raid, entice or
induce any person, firm or corporation (other than the U.S. Government or its
agencies) who or which on the date hereof is, or at any time during the period
of employment hereunder shall be, a customer of Employer or of any of its
subsidiary companies to become a customer for the same or similar products which
it purchased from Employer or any of its subsidiary companies, of any other
person, firm or corporation, and Employee shall, not approach any such customer
for such purpose or authorize or knowingly approve the taking of such actions by
any other person.

                  (e)  Employee agrees that during the term of his employment by
Employer, whether under this Agreement or otherwise, he will not at any time
enter into, on behalf of Employer or any of its subsidiary companies, or cause
Employer or any of its subsidiary companies to enter into, directly or
indirectly, any transactions with any business organization in which he or any
member of his immediate family may be interested as a partner, trustee,
director, officer, employee, shareholder, lender of money or guarantor.

            7.    INJUNCTIVE RELIEF. Employee acknowledges that the services to
be rendered by him hereunder are of a special, unique and extraordinary
character and that it would be very difficult or impossible to replace such
services and further that irreparable injury would be sustained by Employer and
its subsidiary companies in the event of a violation by Employee of any of the
provisions of this Agreement, and by reason thereof Employee consents and agrees
that if he violates any of the provisions of this Agreement, Employer shall be
entitled to an injunction to be issued by any court of competent jurisdiction
restraining him from committing or continuing any violation of this Agreement.

            8.    SURVIVAL OF PROVISIONS. The provisions of Sections 4, 5, 6, 7,
and 10 hereof shall survive the termination or expiration of this Agreement,
irrespective of the reason therefor.

                                       6
<PAGE>

            9.    EXPENSES. Employer shall reimburse Employee for all reasonable
expenses incurred by him on behalf of Employer in the performance of his duties
hereunder, provided that proper vouchers are submitted to Employer by Employee
evidencing such expenses and the purposes for which the same were incurred.

            10.   DISABILITY. If Employee shall be incapacitated by reason of
mental or physical disability or otherwise during the term of this Agreement so
that he is prevented from performing his principal duties and services hereunder
for a period of three (3) consecutive months or one or more periods aggregating
three (3) months during any twelve (12) month period, Employer shall have the
right to terminate this Agreement by sending written notice of termination to
Employee, and thereupon his employment pursuant to this Agreement shall
terminate and Employee shall be entitled to no further payments hereunder, other
than (i) for any compensation due pursuant to Section 4 (a)(i),(iv) and (v)
hereof, and (ii) the reimbursement, pursuant to Section 9 hereof, of any
expenses incurred prior to the date of such termination. For purposes of this
Section 10, amounts payable under subsection (i) hereof shall be inclusive of
amounts paid to Employee in lieu of normal cash compensation under Employer
sponsored Short Term and Long Term Disability Insurance policies during the
eighteen months following cessation of employment. In other words, Employer will
pay only that amount in excess of the insurance payments made each month that is
necessary to provide Employee with cash compensation equal to what would have
been paid pursuant to Section 4 but for the insurance payments.

            11.   DEATH. In the event of the death of Employee during the term
hereof, this Agreement shall automatically terminate and Employer shall have no
further obligations hereunder, other than to pay to Employee's estate any
compensation due pursuant to Section 4 (a)(i) and (iv) hereof through the date
of such termination and to reimburse, pursuant to Section 9 hereof, any expenses
incurred by Employee through the date of such termination.

            12.   TERMINATION BY EMPLOYER FOR CAUSE. Employer shall have the
right to terminate the employment of Employee under this Agreement as well as
any and all payments to be made hereunder, other than for any compensation due
pursuant to Section 4 (a)(i) hereof through the date of such termination and any
reimbursement, pursuant to Section 9 hereof, of expenses incurred by Employee
through the date of such termination, if Employee shall commit any of the
following acts of default:

                  (a)  Employee shall have committed any material breach of any
of the provisions or covenants set forth herein; or

                                       7
<PAGE>

                  (b)  Employee shall have committed any act of gross negligence
in the performance of his duties or obligations hereunder; or

                  (c)  Employee shall have committed any material act of
dishonesty or breach of trust against Employer or any of its subsidiary
companies; or

                  (d)  Employee's conviction of, or plea of NOLO CONTENDERE to,
a felony.

            If Employer elects to terminate this Agreement as set forth above,
Employer shall send written notice to Employee terminating this Agreement and
describing the action of Employee constituting the act of default, and thereupon
no further payments of any type shall be made or shall be payable to Employee
hereunder notwithstanding any other provisions of this Agreement, except as set
forth in the first sentence of this Section 12.

             13.  NO CONFLICTING AGREEMENTS. Employee represents and warrants
that he is not a party to any agreement, contract or understanding, whether
employment or otherwise, which would in any way restrict or prohibit him from
undertaking or performing employment in accordance with the terms and conditions
of this Agreement.

            14.   ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof, and no
statement, representation, warranty or covenant has been made by either party
except as expressly set forth herein. This Agreement shall not be changed or
terminated orally. This Agreement supersedes and cancels all prior agreements
between the parties, or any subsidiary of Employer whether written or oral,
relating to the employment of Employee.

            15.   APPLICABLE LAW. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the State of New York, without
regard to its conflict of laws principles.

            16.   NOTICES. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered, telecopied or mailed, first class, postage
prepaid, certified mail, return receipt requested, to each of the parties at its
or his address above written or as set forth beneath their signatures below or
at such other address or telecopy number as either of the parties may designate
in conformity with the foregoing.

                                       8
<PAGE>

            17.   SECTION HEADINGS. The Section headings set forth in this
Agreement are for convenience only and shall not be considered as part of this
Agreement in any respect nor shall they in any way affect the substance of any
provisions contained in this Agreement.

            18.   SUCCESSORS AND ASSIGNS. This Agreement shall not be assignable
by Employee. All of the terms and provisions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective heirs and
personal representatives of Employee and the successors and assigns of Employer.

            19.   SEVERABILITY. If, at any time subsequent to the date hereof,
any provision of this Agreement shall be held by any court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall be of no
force and effect, but the illegality or unenforceability of such provision shall
have no effect upon and shall not impair the enforceability of any other
provisions of this Agreement.

            IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

UNITED INDUSTRIAL CORPORATION                   EMPLOYEE

By:    /s/ Richard R. Erkeneff                  /s/ James H. Perry
       -----------------------                  -----------------------
       Richard R. Erkeneff                      James H. Perry
       President & CEO                          Fax: (410) 654-1813
       Fax No.: (212) 838-4629

                                       9

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9

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