Document:

exv10w1

 

Exhibit 10.1

EXCHANGE AND SETTLEMENT AGREEMENT

     EXCHANGE AND SETTLEMENT AGREEMENT, dated December 27, 2007 (this “Agreement”), is among LCC
International, Inc., a Delaware corporation (the “Company”), and the Investors listed on the
signature pages hereto (collectively, the “Investors”).

W I T N E S S E T H:

     WHEREAS, the Company entered into a Purchase Agreement, dated as of April 19, 2007 (the
“Purchase Agreement”), with the Investors party thereto pursuant to which, among other things, the
Company issued an aggregate of 5.1 million shares (the “Old Shares”) of the Company’s Class A
Common Stock, par value $0.01 per share (the “Common Stock”); and

     WHEREAS, in connection with the Purchase Agreement, the Company entered into a Registration
Rights Agreement, dated as of April 19, 2007 (the “Registration Rights Agreement”), pursuant to
which, among other things, the Company agreed to register the Old Shares with the Securities and
Exchange Commission (the “SEC”) for resale pursuant to the Securities Act of 1933, as amended; and

     WHEREAS, as of the date hereof, the Company has not registered the Old Shares for resale under
the Securities Act; and

     WHEREAS, certain disputes have arisen among the Company and the Investors regarding such
failure and certain other matters; and

     WHEREAS, the parties hereto believe it is in their respective best interest to settle such
disputes as provided herein.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein, and intending to be
legally bound, the parties hereto agree as follows:

     Section 1. Exchange. At the Closing (as defined below), the Company shall exchange each Old
Share owned by an Investor for 1.125 shares (“Shares”) of the Company’s Series A Convertible
Redeemable Preferred Stock, par value $0.01 per share (the “Preferred Stock”), such Preferred Stock
to have the relative rights, preferences and designations set forth in Exhibit A attached
hereto (the “Certificate of Designations”). In accordance with the terms of the Certificate of
Designations, the Preferred Stock shall be convertible into or otherwise exchangeable for Common
Stock of the Company to the extent specified therein.

     Section 2. Registration Rights.

     (a) Effective at the Closing, the Registration Rights Agreement shall be amended as follows:

          (i) Section 1 shall be amended to include the following definitions:

 

 

               “‘Exchange and Settlement Agreement’ means the Exchange and Settlement Agreement,
dated as of December 27, 2007), among the Company and the Investors.”

               “‘Preferred Stock’ means the Series A Convertible Redeemable Preferred Stock, par
value $0.01 per share, issued pursuant to the terms of the Exchange and Settlement Agreement.”

          (ii) The definition of “Shares” shall be amended to read as follows:

               “‘Shares’ shall mean the shares of Common Stock then issuable (without satisfaction of
any conditions to issuance) pursuant to the conversion of the Preferred Stock or otherwise issued
in respect of the Preferred Stock or any security issued in respect of the Preferred Stock.”

          (iii) The first sentence of Section 2(a)(i) shall be amended to read as follows:

               “The Company shall prepare and file with the SEC a Registration Statement covering all shares
of Common Stock then constituting Registrable Securities for a secondary or resale offering made on
a continuous basis pursuant to Rule 415 promptly after the date (“SEC Report Compliance Date”) that
the Company becomes fully current in its obligations with respect to filings with the SEC,
including its 2006 

Form 10-K, its 2006 Form 10-Qs and the reports on Form 8-K (and amendments
thereto) required to include financial statements and pro formas for the division of Wireless
Facilities, Inc. (WFI) purchased by the Company in June 2007. The Company agrees to continue to
use reasonable best efforts to become fully current in its filing obligations, provided that the
Parties agree that the Company shall not be liable to the Investors for any delays with respect to
such filings. In the event that additional shares of Common Stock constitute Registrable
Securities after such registration statement is filed, the Company shall either amend such
Registration Statement on a pre-effective basis, or if it has already become effective, shall
prepare and file with the SEC one or more additional Registration Statements covering such
additional shares of Common Stock for a secondary or resale offering made on a continuous basis
pursuant to Rule 415.”

          (iv) Section 2(a)(iii) shall be deleted in its entirety.

          (v) Section 2(c) shall be amended to read in its entirety as follows:

               “The Company shall use reasonable best efforts to have the Registration Statement (and any
subsequent Registration Statements) declared effective as promptly as practicable after the filing
of the Registration Statement, provided that the Parties agree that the Company shall not be liable
to the Investors for any delays with respect to such effectiveness. Without limiting the
generality of the foregoing, the Company shall respond to any SEC comments on the Registration
Statement within 15 business days of the Company’s receipt thereof. The Company shall notify the
Investors by facsimile or e-mail within one business day after the Company has been advised that
the Registration Statement has been declared effective and shall simultaneously provide the
Investors with copies of any related Prospectus to be used in connection with the sale or other
disposition of the securities covered thereby.”

 

 

          (vi) All instances of non-compliance with Section 3(o) and 3(p)(ii) occurring prior to the SEC
Reports Compliance Date resulting from the Company not being fully current in its obligations with
respect to filings with the SEC are hereby waived.

     (b) Except as expressly modified hereby, the Registration Rights Agreement shall remain in
full force and effect.

     (c) In the event that the Company determines to file any registration statement for an
offering of its equity securities on its own behalf or on behalf of one or more selling
stockholders (other than a registration statement filed on Form S-4, Form S-8 or on Form S-3, in
the case of a dividend reinvestment plan), the Company shall include the Registrable Securities in
such registration statement (a “Piggy-back Registration Statement”) unless the Registrable
Securities have been included in a Registration Statement pursuant to the terms of this Agreement
and the Company is using commercially reasonable efforts to cause such Registration Statement
effective. Subject to the rights of any third parties, the Company shall have right to determine
in its sole discretion whether to withdraw or seek the effectiveness of any Piggy-back Registration
Statement.

     Section 3. Releases. Effective as of the Closing Date, each of the Investors, on their own
behalf and on behalf of their respective partners, stockholders, members, managers, investment
advisers, directors, officers, employees, agents and representatives, and any and all persons or
entities claiming by or through any of them (the “Investor Parties”), hereby release and forever
discharge the Company and its affiliates, parents, subsidiaries, predecessors, successors, assigns,
legal representatives (collectively, the “Company Released Persons”) of and from any and all manner
of actions, causes of action, suits, account reckonings, covenants, agreements, damages, judgments,
claims and demands whatsoever, at law or in equity, whether known or unknown, contingent or
matured, and whether currently existing or hereafter arising, which the Investor Parties ever had,
now have or may hereafter have (collectively, “Claims”) against the Company Released Persons
arising on or prior to the Closing Date, other than any Claims arising as a result of any failure
by the Company to comply with this Agreement. This release shall include, without limitation, any
and all Claims (i) to the extent arising from failures of the Company to file registration
statements or other filings with the SEC in a timely manner prior to the SEC Reports Compliance
Date, or (ii) relating to the acquisition of the Old Shares by the Investors to the extent arising
from violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by any Company
Released Person, whether or not known to the Investor Parties on the date hereof not based on the
public filings of the Company. This release shall not cover any Claims any of the Investor Parties
may have against any of the Company Released Persons (x) under this Agreement or (y) arising from
any violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder by any Company
Released Person, to the extent not covered by clause (ii) of the immediately preceding sentence.
None of the Investor Parties shall institute any action, claim or complaint of whatever kind or
nature in any federal, state or local court or other governmental agency or administrative tribunal
relating to any Claim which has been released hereby or any contract, agreement, understanding or
arrangement that has been canceled hereby.

 

 

     Section 4. Company Representations. The Company hereby represents and warrants to each of
the Investors as follows:

     (a) The Company is duly organized, validly existing and in good standing under the laws of the
State of Delaware and has full power and authority to execute and deliver this Agreement and to
perform its obligations hereunder, all of which have been duly authorized by all requisite
corporate action; provided, however, that the Company makes no representation regarding the receipt
of any approvals of stockholders which are contemplated by the Certificate of Designations
(including for conversion of shares beyond permitted limits). This Agreement has been duly
authorized, executed and delivered by the Company and constitutes a valid and binding agreement of
the Company, enforceable against the Company in accordance with its terms.

     (b) Neither the execution and delivery of this Agreement by the Company nor the performance by
the Company of its obligations hereunder and thereunder will (i) contravene any provision contained
in the Amended and Restated Certificate of Incorporation or Bylaws of the Company, (ii) violate or
result in a breach (with or without the lapse of time, the giving of notice or both) of or
constitute a default under (A) any material contract, agreement, commitment, indenture, mortgage,
lease, pledge, note, license, permit or other instrument or obligation or (B) any judgment, order,
decree, law, rule or regulation or other restriction of any governmental authority, in each case to
which the Company is a party or by which the Company is bound or to which any of its assets or
properties are subject, (iii) result in the creation or imposition of any material lien, claim,
charge, mortgage, pledge, security interest, equity, restriction or other encumbrance
(collectively, “Encumbrances”) on any of the assets or properties of the Company or any subsidiary,
or (iv) result in the acceleration of, or permit any person to accelerate or declare due and
payable prior to its stated maturity, any obligation of the Company or any subsidiary; provided,
however, that the Company makes no representation regarding the receipt of any approvals of
stockholders which are contemplated by the Certificate of Designations (including for conversion of
shares beyond permitted limits).

     (c) No notice to, filing with, or authorization, registration, consent or approval of any
governmental authority or other person is necessary for the execution, delivery or performance of
this Agreement or the consummation of the transactions contemplated hereby or thereby by the
Company, except for customary post-closing filings required pursuant to applicable securities laws
which will be made in the ordinary course and expect that under Nasdaq rules approvals of
stockholders will be required for certain matters as contemplated under the Certificate of
Designations (including for conversion of shares beyond permitted limits).

     (d) The Shares have been duly and validly authorized and, when issued pursuant to this
Agreement, will be validly issued, fully paid and nonassessable, and shall be free and clear of all
Encumbrances (other than those created by the Investors) and will be entitled to the relative
rights, powers and preferences set forth in the Certificate of Designations. The PIK Shares have
been duly and validly authorized and, when issued pursuant to the Certificate of Designations, will
be validly issued, fully paid and nonassessable, and shall be free and clear of all Encumbrances
(other than those created by the Investors). The Common Stock issuable upon the due conversion or
other exchange in accordance with the Certificate of Designations, will, when

 

 

issued, be validly issued, fully paid and nonassessable, and shall be free and clear of all
Encumbrances (other than those created by the Investors).

     Section 5. Investor Representations. Each of the Investors hereby, severally and not
jointly, represents and warrants to the Company (as to itself only) as follows:

     (a) It is duly organized, validly existing and in good standing under the laws of its
jurisdiction of formation and has full power and authority to execute and deliver this Agreement
and to perform its obligations hereunder, all of which have been duly authorized by all requisite
corporate, partnership or limited liability company action, as applicable. This Agreement has been
duly authorized, executed and delivered by it and constitutes its valid and binding agreement,
enforceable against it in accordance with its terms.

     (b) Neither the execution and delivery of this Agreement nor the performance by it of its
obligations hereunder and thereunder will (i) contravene any provision contained in its
organizational documents, (ii) violate or result in a breach (with or without the lapse of time,
the giving of notice or both) of or constitute a default under (A) any material contract,
agreement, commitment, indenture, mortgage, lease, pledge, note, license, permit or other
instrument or obligation or (B) any judgment, order, decree, law, rule or regulation or other
restriction of any governmental authority, in each case to which it is a party or by which it is
bound or to which any of its assets or properties are subject, or (iii) result in the creation or
imposition of any material Encumbrances on the Old Shares held by it.

     (c) No notice to, filing with, or authorization, registration, consent or approval of any
governmental authority or other person is necessary for the execution, delivery or performance of
this Agreement or the consummation of the transactions contemplated hereby or thereby by it.

     (d) It is the legal owner of the Old Shares listed on the signature pages hereto as owed by
it, free and clear of all Encumbrances except those created pursuant to the Purchase Agreement and
the Registration Rights Agreement and those imposed generally by applicable securities laws. There
are no voting trust arrangements, shareholder agreements or other agreements granting any option,
warrant, proxy or right of first refusal with respect to the Old Shares held by it to any person or
entity. It has the absolute and unrestricted right, power and capacity to sell the Old Shares as
contemplated hereby free and clear of any Encumbrances (except for restrictions imposed generally
by applicable securities laws).

     (e) Its representations and warranties contained in Article 5 of the Purchase Agreement (which
related to the Old Shares) are also true and correct in all material respects as of the date hereof
with respect to the Shares, the PIK Shares and any Common Stock issuable upon conversion of the
Shares or PIK Shares.

     Section 6. Conditions to Closing; Termination.

     (a) The obligations of each of the Investors hereunder are subject to the fulfillment to such
Investor’s satisfaction, on or prior to the Closing Date, of the following conditions, any of which
may be waived by it (as to itself only):

 

 

          (i) The representations and warranties made by the Company in Section 4 hereof qualified as to
materiality shall be true and correct at all times prior to and on the Closing Date, except to the
extent any such representation or warranty expressly speaks as of an earlier date, in which case
such representation or warranty shall be true and correct as of such earlier date, and, the
representations and warranties made by the Company in Section 4 hereof not qualified as to
materiality shall be true and correct in all material respects at all times prior to and on the
Closing Date, except to the extent any such representation or warranty expressly speaks as of an
earlier date, in which case such representation or warranty shall be true and correct in all
material respects as of such earlier date. The Company shall have performed in all material
respects all obligations and covenants herein required to be performed by it on or prior to the
Closing Date.

          (ii) The Company shall have obtained any and all consents, permits, approvals, registrations
and waivers necessary or appropriate for consummation of the transactions contemplated by this
Agreement, all of which shall be in full force and effect; provided, however, that this condition
shall not require the receipt of any approvals of stockholders which may be contemplated by the
Certificate of Designations (including for conversion of shares beyond permitted limits).

          (iii) The Certificate of Designations shall have been filed with the Secretary of State of
Delaware and shall have become effective.

          (iv) The Company shall have delivered to each Investor one or more certificates representing
the Shares acquired by such Investor hereunder, registered in such names as the Investor may have
requested.

          (v) No judgment, writ, order, injunction, award or decree of or by any court, or judge,
justice or magistrate, including any bankruptcy court or judge, or any order of or by any
governmental authority, shall have been issued, and no action or proceeding shall have been
instituted by any governmental authority, enjoining or preventing the consummation of the
transactions contemplated hereby.

          (vi) No stop order or suspension of trading shall have been imposed by Nasdaq, the SEC or any
other governmental or regulatory body with respect to public trading in the Common Stock.

     (b) The obligations of the Company hereunder are subject to the fulfillment to the Company’s
satisfaction, on or prior to the Closing Date, of the following conditions, any of which may be
waived by it:

          (i) The representations and warranties made by the Investors in Section 5 hereof shall be true
and correct in all material respects when made, and shall be true and correct in all material
respects on the Closing Date with the same force and effect as if they had been made on and as of
said date. The Investors shall have performed in all material respects all

 

 

obligations and covenants herein required to be performed by them on or prior to the Closing Date.

          (ii) The Investors shall have delivered to the Company the certificates representing the Old
Shares, in each case accompanied by such executed stock powers or other transfer instruments
reasonably requested by the Company.

     (c) The obligations of the Company, on the one hand, and the Investors, on the other hand, to
effect the Closing shall terminate as follows:

          (i) Upon the mutual written consent of the Company and the Investors;

          (ii) By the Company if any of the conditions set forth in Section 6(b) shall have become
incapable of fulfillment, and shall not have been waived by the Company;

          (iii) By an Investor (with respect to itself only) if any of the conditions set forth in
Section 6(a) shall have become incapable of fulfillment, and shall not have been waived by the
Investor; or

          (iv) By either the Company or any Investor (with respect to itself only) if the Closing has
not occurred on or prior to December 31, 2007;

provided, however, that, except in the case of clause (i) above, the party seeking to terminate its
obligation to effect the Closing shall not then be in breach of any of its representations,
warranties, covenants or agreements contained in this Agreement or the other Transaction Documents
if such breach has resulted in the circumstances giving rise to such party’s seeking to terminate
its obligation to effect the Closing.

     (d) In the event of termination by the Company or any Investor of its obligations to effect
the Closing pursuant to this Section 6, written notice thereof shall forthwith be given to the
other Investors and the other Investors shall have the right to terminate their obligations to
effect the Closing upon written notice to the Company and the other Investors. Nothing in this
Section 6 shall be deemed to release any party from any liability for any breach by such party of
the terms and provisions of this Agreement or to impair the right of any party to compel specific
performance by any other party of its obligations under this Agreement.

     Section 7. Closing. The Closing shall take place at the offices of Lowenstein Sandler PC,
1251 Avenue of the Americas, 18th Floor, New York, New York 10020, no later than the second
Business Day after the conditions to Closing set forth herein have been satisfied or waived, to the
extent permitted by applicable law, or at such other location and on such other date as the Company
and the Investors shall mutually agree. As used herein, “Business Day” means a day, other than a
Saturday, Sunday or legal holiday, on which commercial banks in New York City are open for the
general transaction of business.

     Section 8. Further Assurances. Subject to the terms and conditions herein provided, each of
the parties hereto shall take, or cause to be taken, all action, and to do, or cause to be

 

 

done, all things reasonably necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement. In the event that
at any time hereafter any further action is necessary to carry out the purposes of this Agreement,
the parties hereto shall take all such action without any further consideration therefor.

     Section 9. Equitable Remedies. Each of the parties hereto acknowledges that the other
parties hereto would suffer immediate and irreparable harm for which an adequate remedy would not
be available at law as a result of any breach of this Agreement. Accordingly, in the event of any
breach, or threatened breach, of the provisions of this Agreement, each party hereto shall be
entitled to an order of specific performance or other injunctive relief against the breaching party
in addition to any other rights and remedies to which they may be entitled, whether at law or in
equity, and each party hereby irrevocably and unconditionally consents to the entry of an order
providing such relief in the event of any breach or threatened breach of the terms hereof by such
party. No party shall be required to post any bond or other security in connection with any such
action for specific performance or other injunctive relief.

     Section 10. Prohibited Transactions. While the Shares are outstanding, and until they have
been converted into Common Stock under the Certificate of Designations, no Investor nor any Trading
Affiliate (as defined in the Purchase Agreement) of such Investor, shall, and no Investor shall
seek to cause any other person or entity to, directly or indirectly, effect or agree to effect any
short sale, whether or not against the box, established any “put equivalent position” (as defined in
Rule 16a-1(h) under the 1934 Act) with respect to the Common
Stock, borrowed or pre-borrowed any shares
of Common Stock, granted any other right (including, without limitation, any put or call option) with
respect to the Common Stock or with respect to any security that includes, relates to or derived
any significant part of its value from the Common Stock or otherwise sought to hedge its position
in the Securities (each, a “Prohibited Transaction”); provided, however, that after the earlier of
(i) the six-month anniversary of the SEC Report Compliance Date and (ii) the consummation of a
Qualified Financing, the provisions of this Section 10 shall only apply during any period in which
the Company has advised the Investors that the Company is actively seeking to complete a Qualified
Financing. The Investors covenant, represent and agree that they will comply with all provisions
of the federal securities laws regarding avoiding manipulation and trading on non-public
information as they relate to the Shares, particularly until the Shares have been converted into
Common Stock under the Certificate of Designations.

     Section 11. Successors and Assigns. This Agreement may not be assigned by a party hereto
without the prior written consent of the other parties hereto. The provisions of this Agreement
shall inure to the benefit of and be binding upon the respective permitted successors and assigns
of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.

     Section 12. Counterparts; Faxes; Titles and Subtitles. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of which together

 

 

shall constitute one and the same instrument. This Agreement may also be executed via facsimile,
which shall be deemed an original. The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this Agreement.

     Section 13 Notices. Unless otherwise provided, any notice required or permitted under this
Agreement shall be given in writing and shall be deemed effectively given as hereinafter described
(i) if given by personal delivery, then such notice shall be deemed given upon such delivery, (ii)
if given by telex or telecopier, then such notice shall be deemed given upon receipt of
confirmation of complete transmittal, (iii) if given by mail, then such notice shall be deemed
given upon the earlier of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by an internationally
recognized overnight air courier, then such notice shall be deemed given one Business Day after
delivery to such carrier. All notices shall be addressed to the party to be notified at the
address as follows, or at such other address as such party may designate by ten days’ advance
written notice to the other party:

	 	 	 	 	 
	 	 	If to the Company:
	 
	 	 	 	 
	 

	 	 	 	LCC International, Inc.
	 

	 	 	 	7900 West Park Drive, Suite 315-A
	 

	 	 	 	Mclean, Virginia 22101
	 

	 	 	 	Attention: General Counsel
	 

	 	 	 	Tel: (703) 873-2000
	 

	 	 	 	Fax: (703) 873-2100
	 
	 	 	 	 
	 	 	With a copy to:
	 
	 	 	 	 
	 

	 	 	 	Hogan & Hartson L.L.P.
	 

	 	 	 	555 Thirteenth St. N.W.
	 

	 	 	 	Washington, D.C. 2004
	 

	 	 	 	Attention: Steven M. Kaufman
	 

	 	 	 	Tel: (202) 637-5736
	 

	 	 	 	Fax: (202) 637-5910
	 
	 	 	 	 
	 	 	If to the Investors:

to the addresses set forth on the signature pages hereto.

     Section 14. Expenses. The parties hereto shall pay their own costs and expenses in
connection herewith except that the Company shall pay the reasonable fees and expenses of
Lowenstein Sandler PC not to exceed $35,000. Such expenses shall be paid not later than the
Closing. The Company shall reimburse the Investors upon demand for all reasonable out-of-pocket
expenses incurred by the Investors, including without limitation reimbursement of attorneys’ fees
and disbursements for one counsel on behalf of the Investors, in connection with any amendment,
modification or waiver of this Agreement requested by the Company. In the

 

 

event that legal proceedings are commenced by any party to this Agreement against another party to
this Agreement in connection with this Agreement, the party or parties which do not prevail in such
proceedings shall severally, but not jointly, pay their pro rata share of the reasonable attorneys’
fees and other reasonable out-of-pocket costs and expenses incurred by the prevailing party in such
proceedings.

     Section 15. Amendments and Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written consent of the Company
and the Investors.

     Section 16. Publicity. No public release or announcement concerning the transactions
contemplated hereby shall be issued by the Company or the Investors without the prior consent of
the Company (in the case of a release or announcement by the Investors) or the Investors (in the
case of a release or announcement by the Company) (which consents shall not be unreasonably
withheld), except that the Company may issue a press release describing the terms of this
Agreement; provided that Lowenstein Sandler PC shall have the right to comment on such release
prior to its publication. Notwithstanding the foregoing, the Investors acknowledge that the
Company shall be permitted to file a Current Report on Form 8-K to report the transactions
contemplated by the Agreement if the Company determines that such filing is necessary or advisable
to comply with its reporting obligations under applicable securities laws.

     Section 17. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof but shall
be interpreted as if it were written so as to be enforceable to the maximum extent permitted by
applicable law, and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law which renders any
provision hereof prohibited or unenforceable in any respect.

     Section 18. Entire Agreement. This Agreement, including the Exhibits, constitutes the entire
agreement among the parties hereof with respect to the subject matter hereof and thereof and
supersede all prior agreements and understandings, both oral and written, between the parties with
respect to the subject matter hereof and thereof.

     Section 19. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement
shall be governed by, and construed in accordance with, the internal laws of the State of New York
without regard to the choice of law principles thereof. Each of the parties hereto irrevocably
submits to the exclusive jurisdiction of the courts of the State of New York located in New York
County and the United States District Court for the Southern District of New York for the purpose
of any suit, action, proceeding or judgment relating to or arising out of this Agreement and the
transactions contemplated hereby. Service of process in connection with any such suit, action or
proceeding may be served on each party hereto anywhere in the world by the same methods as are
specified for the giving of notices under this Agreement. Each of the parties hereto irrevocably
consents to the jurisdiction of any such court in any such suit, action or

 

 

proceeding and to the laying of venue in such court. Each party hereto irrevocably waives any
objection to the laying of venue of any such suit, action or proceeding brought in such courts and
irrevocably waives any claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A
TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN
CONSULTED SPECIFICALLY AS TO THIS WAIVER.

     Section 20. Independent Nature of Investors’ Obligations and Rights. The obligations of each
Investor hereunder are several and not joint with the obligations of any other Investor, and no
Investor shall be responsible in any way for the performance of the obligations of any other
Investor hereunder. Nothing contained herein, and no action taken by any Investor pursuant
thereto, shall be deemed to constitute the Investors as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Investors are in any way
acting in concert or as a group with respect to such obligations or the transactions contemplated
hereby. Each Investor acknowledges that no other Investor has acted as agent for such Investor in
connection herewith and that no Investor will be acting as agent of such Investor in connection
with monitoring its investment in the Company or enforcing its rights hereunder. Each Investor
shall be entitled to independently protect and enforce its rights, including, without limitation,
the rights arising out of this Agreement, and it shall not be necessary for any other Investor to
be joined as an additional party in any proceeding for such purpose.

     Section 21. No Strict Construction. Each of the parties hereto acknowledge that this
Agreement has been prepared jointly by the parties hereto, and shall not be strictly construed
against any party.

[signature page follows]

 

 

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

	 	 	 	 	 	 	 
	 	 	LCC INTERNATIONAL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Louis Salamone Jr.	 	 
	 

	 	Name:
	 	 

Louis Salamone Jr.
	 	 
	 

	 	Title:
	 	 Executive Vice President & CFO	 	 

 

 

	 	 	 	 	 
	 

	 	[Investors]
	 	 
	 
	 	 	 	 
	 

	 	POTOMAC CAPITAL PARTNERS LP	 	 
	 
	 	 	 	 
	 

	 	/s/ Kenneth Berkow	 	 
	 

	 	 	 	 
	 

	 	Kenneth Berkow, CFO	 	 
	 

	 	Date: December 26, 2007	 	 
	 
	 	 	 	 
	 

	 	POTOMAC CAPITAL INTERNATIONAL LTD.	 	 
	 
	 	 	 	 
	 

	 	/s/ Kenneth Berkow	 	 
	 

	 	 	 	 
	 

	 	Kenneth Berkow, CFO	 	 
	 

	 	Date: December 26, 2007	 	 
	 
	 	 	 	 
	 

	 	PLEIADES INVESTMENT PARTNERS-R LP	 	 
	 
	 	 	 	 
	 

	 	/s/ Kenneth Berkow	 	 
	 

	 	 	 	 
	 

	 	Kenneth Berkow, CFO	 	 
	 

	 	Date: December 26, 2007	 	 

 

 

RILEY INVESTMENT PARTNERS MASTER FUND, L.P.

By: Riley Investment Management LLC,

Its General Partner

	 	 	 	 	 
	 	By:

	 	/s/ Bryant Riley
	 
	 	 

	 	 	 
	 	Name:

	 	Bryant Riley	 
	 	Title:

	 	G.P.	 

GPC LXII, LLC

By: Riley Investment Management LLC,

As attorney in fact

	 	 	 	 	 
	 	By:

	 	/s/ Bryant Riley
 

	 
	 	Name:

	 	Bryant Riley	 
	 	Title:

	 	G.P.	 

 

 

	 	 	 	 	 
	Investor:

	 	LLOYD I. MILLER, III
	 	 
	 
	 	 	 	 
	 

	 	/s/ Lloyd I. Miller, III	 	 
	 

	 	 	 	 
	 

	 	Name: Lloyd I. Miller, III	 	 

 

 

	 	 	 	 	 	 	 
	Investor:	 	MILFAM II L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Milfam LLC	 	 
	 	 	Its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lloyd I. Miller III
 

	 	 
	 	 	Name: Lloyd I. Miller, III	 	 
	 	 	Title: Manager	 	 

 

 

	 	 	 	 	 	 	 
	Investor:	 	TRUST A-4 — LLOYD I. MILLER	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	PNC Bank National Association as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lloyd I. Miller III
 

	 	 
	 	 	Name: Lloyd I. Miller, III	 	 
	 	 	Title: Investment Advisor to Trustee	 	 

 

 

	 	 	 	 	 	 	 
	Investor:	 	SRB GREENWAY CAPITAL, L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: SRB Management, L.P., General Partner	 	 
	 
	 	 	 	 	 	 
	 	 	By: BC Advisors, L.L.C., General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Steven R. Becker
 

	 	 
	 	 	Name: Steven R. Becker	 	 
	 	 	Title: Member	 	 

	 	 	 	 	 	 	 
	Old Shares: 119,000

Address for Notice:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	300 Crescent Court, Suíte 1111	 	 
	 	 	Dallas, TX 75201	 	 
	 
	 	 	 	 	 	 
	 	 	with a copy to:	 	 
	 
	 	 	 	 	 	 
	 	 	Lowenstein Sandler PC	 	 
	 	 	65 Livingston Avenue	 	 
	 	 	Roseland, NJ 07068	 	 
	 	 	Attn: John D. Hogoboom, Esq.	 	 
	 	 	Telephone: 973.597.2500	 	 
	 	 	Facsimile: 973.597.2400	 	 
	 
	 	 	 	 	 	 
	 	 	SRB Greenway Capital (QP), L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: SRB Management, L.P., General Partner	 	 
	 
	 	 	 	 	 	 
	 	 	By: BC Advisors, L.L.C., General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Steven R. Becker
 

	 	 
	 

	 	Name:
	 	Steven R. Becker	 	 
	 

	 	Title:
	 	 Member	 	 
	 
	 	 	 	 	 	 
	Old Shares: 1,031,100
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Address for Notice:
	 	 	 	 	 	 
	 	 	300 Crescent Court, Suíte 1111	 	 
	 	 	Dallas, TX 75201	 	 
	 
	 	 	 	 	 	 
	 	 	with a copy to:	 	 

 

 

	 	 	 	 	 	 	 
	 	 	  Lowenstein Sandler PC	 	 
	 	 	  65 Livingston Avenue	 	 
	 	 	  Roseland, NJ 07068	 	 
	 	 	  Attn: John D. Hogoboom, Esq.	 	 
	 	 	  Telephone: 973.597.2500	 	 
	 	 	  Facsimile: 973.597.2400	 	 
	 
	 	 	 	 	 	 
	 	 	SRB Greenway Offshore Operating Fund, L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: SRB Management, L.P., General Partner	 	 
	 
	 	 	 	 	 	 
	 	 	By: BC Advisors, L.L.C., General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Steven R. Becker
 

	 	 
	 	 	Name: Steven R. Becker	 	 
	 	 	Title: Member	 	 
	 
	 	 	 	 	 	 
	Old Shares: 43,930
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Address for Notice:
	 	 	 	 	 	 
	 	 	  300 Crescent Court, Suíte 1111	 	 
	 	 	  Dallas, TX 75201	 	 
	 
	 	 	 	 	 	 
	 	 	  with a copy to:	 	 
	 
	 	 	 	 	 	 
	 	 	  Lowenstein Sandler PC	 	 
	 	 	  65 Livingston Avenue	 	 
	 	 	  Roseland, NJ 07068	 	 
	 	 	  Attn: John D. Hogoboom, Esq.	 	 
	 	 	  Telephone: 973.597.2500	 	 
	 	 	  Facsimile: 973.597.2400	 	 

 

 

	 	 	 	 	 	 	 
	 	 	Aurarian Capital Partners II and Aurarian Offshore, LTD.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Marc Tauber
 

	 	 
	 

	 	Name:
	 	Marc Tauber	 	 
	 

	 	Title:
	 	COO	 	 

 

 

	 	 	 	 	 
	 	Alchemy Ventures, Inc.	 	 
	 	By:

	 	/s/ Mark Rogers
     

	 
	 	Mark Rogers	 
	 	President & CEOexv10w1

 

EXHIBIT 10.1

November 9, 2007

Martha R. Carlin

11860 Bell Cross Circle

Parker, Colorado 80138

Re: Separation of Employment from UDR, Inc.

Dear Martha:

As we have discussed, your employment with UDR, Inc. (the “Company”) will end
effective November 8, 2007 (the “Separation Date”). This letter (this “Letter
Agreement”) reflects our agreement with respect to the separation of your
employment with the Company.

1.     Last Day of Employment. Your last day of employment with the Company
will be November 8, 2007.

2.     Vacation Pay. You will be paid an amount equal to all accrued but
unused vacation up to November 8, 2007. You are entitled to payment of all
accrued but unused vacation whether or not you sign this Letter Agreement. You
will not be entitled to use sick leave, salary continuation or disability
benefits after the Separation Date.

3.     Consideration. In consideration for signing this Letter Agreement
the Company agrees that:

     (a)     You may continue to participate in the Company’s group health insurance
plans at the same coverage levels as immediately prior to the Separation Date.
Coverage will continue through the Consolidated Omnibus Budget Reconciliation
Act of 1985 (“COBRA”) until the first to occur of (i) November 7, 2012; (ii)
your employment by a third party (a third party shall not be deemed to include
an entity of which all of the outstanding capital stock or ownership interests
are owned by you) or (iii) you default in the payment of or no longer continue
to pay your portion of the premiums (the “Severance Period”). During the
Severance Period, the Company shall continue to pay its portion of the premiums
and you will pay your portion of the premiums. At the end of the Severance
Period, if you do not have health insurance from another employer, you may
continue coverage as required by COBRA at your own expense.

 

 

     Provided that you pay the applicable premiums you may retain your
supplemental life, disability and cancer policies through November 7, 2008.

     You hereby agree to inform Thomas W. Toomey, Chief Executive Officer and
President, UDR, Inc., 1745 Shea Center Drive, Suite 200, Highlands Ranch, CO
80129, immediately upon your acceptance of employment by a third party.

     (b)     The Company shall cause United Dominion Realty, L.P. and/or UDR
Out-Performance III, LLC to repurchase 45,000 Membership Units in UDR
Out-Performance III, LLC, which constitutes 100% of the Membership Units in UDR
Out-Performance III, LLC owned by you, for Forty-Five Thousand Dollars and No
Cents ($45,000.00), such amount to be paid to you within thirty (30) days of the
Separation Date.

     (c)     The Company shall cause United Dominion Realty, L.P. and/or UDR
Out-Performance IV, LLC to repurchase 166,000 Membership Units in UDR
Out-Performance IV, LLC, which constitutes 100% of the Membership Units in UDR
Out-Performance IV, LLC owned by you, for One Hundred Sixty-Six Thousand Dollars
and No Cents ($166,000.00), such amount to be paid to you within thirty (30)
days of the Separation Date.

     (d)     The Company shall cause United Dominion Realty, L.P. and/or UDR
Out-Performance V, LLC to repurchase 115,000 Membership Units in UDR
Out-Performance V, LLC, which constitutes 100% of the Membership Units in UDR
Out-Performance V, LLC owned by you, for One Hundred Fifteen Thousand Dollars
and No Cents ($115,000.00), such amount to be paid to you within thirty (30)
days of the Separation Date.

     (e)     You will be treated as though you were an employee of the Company
through December 31, 2007 and all shares of Common Stock that would have vested
under your Notices of Performance Contingent Restricted Stock Awards (“PARS”) as
of such date shall vest pursuant to the terms of such agreements. With respect
to the 2007 PARS, you will also be treated as though you were an employee of the
Company through December 31, 2007 and pursuant to the terms of your Notice of
Performance Contingent Restricted Stock Award (“Stock Award”) and upon
determination by the Compensation Committee of the Board of Directors of the
Company (“Compensation Committee”) as to the targeted award level for the 2007
PARS Program, you will be vested in 1/4 of the Initial Shares and Additional
Shares (as defined in your Stock Award), if any, upon the Compensation
Committee’s determination of the award level for the 2007 PARS Program.

 

 

     (f)     Except as set forth in Section 3(e), you will forfeit any right to
receive additional shares of Common Stock under your 2004, 2005, 2006 and 2007
Performance Contingent Restricted Stock Award grants.

     (g)     All restrictions on the following Restricted Stock Awards held by you
that remain subject to restrictions on November 8, 2007 shall lapse:

          (i)     2,709 shares of restricted Common Stock granted to you on February 12,
2004;

          (ii)     5,369 shares of restricted Common Stock granted to you on February 18,
2005;

          (iii)     3,973 shares of restricted Common Stock granted to you on February
15, 2006; and

          (iv)     5,924 shares of restricted Common Stock granted to you on February 8,
2007.

     (h)     A bonus for fiscal year 2007 in the amount of $600,000 payable at the
same time the Company pays fiscal year 2007 bonuses to the Company’s other
senior executives.

4.     Other Benefits. Except as provided explicitly in this Letter
Agreement, you shall not be entitled to any other or further benefits from
Company, including, without limitation, participation in health and dental
insurance plans, disability and life insurance plans, stock plans, 401(k) plans,
and profit sharing plans.

5.     Expenses. Your expense report for expenses incurred through the
Separation Date must be received within three business days after the Separation
Date. You will be reimbursed for expenses incurred through the Separation Date
in accordance with ordinary Company reimbursement practices and policies. If a
final accounting of these new expenditures indicates that you owe the Company
any amount (e.g., for charges to Company accounts) after your expense reports
have been processed, you must pay such amount within three days after the later
of the Effective Date or the Separation Date.

6.     Company Property. You acknowledge that you have returned to the
Company all Company documents (including copies) and property which you may
possess, including, but not limited to, the

 

 

following proprietary information of the Company: files, memoranda, notes,
computer-recorded information, personnel records (except copies of any
agreements you may have signed with the Company), equipment, materials, keys,
entry cards, identification, credit cards, and any other materials of any kind
that embodies any confidential or proprietary information of the Company (and
all reproductions thereof).

7.     Revocation. You understand that you have twenty-one (21) days to
consider the preclusive effect of this Letter Agreement prior to executing this
Letter Agreement. You further understand that you may revoke this Letter
Agreement for a period of seven (7) days following your execution of this Letter
Agreement. Any revocation within this period must be submitted, in writing, to:
the Company, c/o Thomas W. Toomey, Chief Executive Officer and President, and
state, “I hereby revoke my acceptance of the Letter Agreement.” The revocation
must be mailed to the Company, c/o Thomas W. Toomey, Chief Executive Officer and
President, or his designee, and postmarked within seven (7) days of execution of
this Letter Agreement. This Letter Agreement shall not become effective or
enforceable until the revocation period has expired. If the last day of the
revocation period is a Saturday, Sunday, or legal holiday in Colorado, then the
revocation period shall not expire until the next following day which is not a
Saturday, Sunday, or legal holiday in Colorado.

8.     General Release of Claim and Covenant Not to Sue.

     (a)     In consideration of the benefits provided to you under this Letter
Agreement, and except for the obligations created by this Letter Agreement, you
knowingly and voluntarily release and forever discharge the Company and its
affiliates, as well as their respective officers, directors, employees,
stockholders, agents, attorneys, insurers, representatives, assigns and
successors, past and present, and each of them (hereinafter together and
collectively referred to as the “Released Parties”) of, with respect to and from
any and all actions, and claims of any kind, known and unknown, suspected or
unsuspected, against the Released Parties, which you, your heirs, executors,
administrators, successors, and assigns (together and collectively “Executive”)
have or may have as of the date of execution of this Letter Agreement,
including, but not limited to, any alleged violation of:

The National Labor Relations Act, as amended;

Title VII of the Civil Rights Act of 1964, as amended;

Sections 1981 through 1988 of Title 42 of the United States Code, as amended;

 

 

The Employee Retirement Income Security Act of 1974, as amended;

The Immigration Reform Control Act, as amended;

The Americans with Disability Act of 1990, as amended;

The Age Discrimination in Employment Act of 1967, as amended;

The Fair Labor Standards Act, as amended;

The Occupational Safety and Health Act, as amended;

The Equal Pay Act;

The Family and Medical Leave Act of 1993;

all Colorado laws concerning the workplace;

any other federal, state or local civil or human rights law or any other local,
state or federal law, regulation or ordinance; based upon any covenant of good
faith and fair dealing, implied or express contract, wrongful discharge,
promissory estoppel, equitable estoppel, employee benefit, violation of public
policy, negligent or intentional infliction of emotional distress, defamation,
false light, compelled self-publication, fraud, misrepresentation, invasion of
privacy, assault, battery, tortious interference with a contract, tortious
interference with a business relationship or economic interest, negligent
retention, negligent hiring, negligent supervision, negligence, negligent
misrepresentation, gross negligence, loss of consortium, equity or any
intentional or other tort; and/or

          (i)     Arising out of the Released Parties’ personnel practices, policies, or
procedures; and

          (ii)     Arising out of or relating to Executive’s employment or the
initiation, existence or cessation of Executive’s employment with the Released
Parties, including any claims for salary, wages, severance pay, vacation pay,
sick pay, bonuses, and any other compensation or benefit of any nature; and

          (iii)     Arising out of any statements or representations to or about
Executive; and

          (iv)     Arising out of any other wrong, injury or loss allegedly suffered by
Executive; and

 

 

any allegation for costs, fees, or other expenses including attorneys’ fees
incurred in these matters (collectively the “Released Claims”).

You shall not sue or initiate against the Released Parties any action or
proceeding, or participate in the same, individually or as a member of a class,
under any contract (express or implied), or any federal, state or local law,
statute or regulation pertaining in any manner to the Released Claims.

     (b)     Except for the obligations created by this Letter Agreement, the
Released Parties hereby covenant not to sue and release and forever discharge
you from any and all claims, known and unknown, which the Release Parties have
or may have against you, including all claims arising from your position as
Executive Vice President — Operations or as an employee of the Company or its
subsidiaries or affiliates and the termination of that relationship (and
specifically including any and all claims related to prior promises or contracts
of employment), as of the date of this Letter Agreement; provided, however, the
Released Parties do not release you with respect to claims arising out of or
relating to fraud, gross negligence or willful misconduct.

9.     No Claims Exist. You confirm that no claim, charge, complaint, or
action exists pertaining in any manner to the Released Claims in any forum or
form. In the event that any such claim, charge, complaint or action is filed,
you shall not be entitled to recover any relief or recovery therefrom, including
costs and attorney’s fees.

10.     Non-Disparagement. You agree not to make any negative, disparaging,
disruptive or damaging statements, comments or remarks to any third party
concerning the Company and its business. In response to inquiries about you
from individuals outside of Company, Company’s official response shall be to
provide our standard reference information of dates of employment and title.

11.     Assistance. In partial consideration for the benefits provided to
you by the Company under this Letter Agreement, to which you are not otherwise
entitled, you agree to provide reasonable assistance related to transition
matters to the Company and/or its employees.

12.     Confidentiality. You acknowledge that you have been exposed to and
have learned a substantial amount of information, which is proprietary and
confidential to the Company, whether or not you developed or created such
information. You acknowledge that such proprietary and confidential information
may include, but is not limited to, trade secrets; acquisition or merger
information; advertising and promotional programs; resource or developmental
projects; plans or strategies for future business development; financial or
statistical data; customer information,

 

 

including, but not limited to, customer lists, sales records, account records,
sales and marketing programs, pricing matters, and strategies and reports; and
any Company manuals, forms, techniques, and other business procedures or
methods, devices, computer software or matters of any kind relating to or with
respect to any confidential program or projects of the Company, or any other
information of a similar nature made available to you and not known in the trade
in which the Company is engaged, which, if misused or disclosed, could adversely
affect the business or standing of the Company (collectively, the “Confidential
Information”). Confidential Information shall not include information that is
generally known or generally available to the public through no fault of your
own. You agree that except as required by court order, you will not at any time
divulge to any person, agency, institution, the Company or other entity any
information which you know or has reason to believe is proprietary or
confidential to the Company, including but not limited to the types of
information described above, or use such information to the competitive
disadvantage of the Company. You agree that your duties and obligations under
this Section 12 will continue until the later of twelve (12) months from the
Separation Date, or as long as the Confidential Information remains proprietary
or confidential to the Company.

13.     Non-Solicitation. As further consideration for the benefits
provided in this Letter Agreement for a period terminating twelve (12) months
from the Separation Date, you agree not to directly or indirectly solicit for
employment any person employed by the Company or its affiliates.

14.     Joint Preparation of Agreement. This Letter Agreement is deemed to
have been drafted jointly by the parties. In any interpretation of this Letter
Agreement, the provisions of this Letter Agreement shall not be interpreted or
construed against any party on the basis that the party was the drafter.

15.     Severability. If any provision of this Letter Agreement is
determined to be invalid or unenforceable, in whole or in part, such
determination will not affect any other provision of this Letter Agreement. For
example, if the release of a particular claim is held by a court to be invalid
or unenforceable, such ruling will not affect the releases of any other claims.

16.     Entire Agreement. This Letter Agreement (including the exhibits
hereto) contains the entire agreement between you and the Company and is the
complete, final and exclusive embodiment of our agreement with regard to the
subject matter. It is entered into without reliance on any promise or
representation other than those expressly contained herein, and it may not be
modified except in writing signed by you and an officer of the Company.

 

 

17.     Governing Law. This Letter Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Colorado, as
applied to contracts made and performed entirely within the State of Colorado.

Please sign and return this Letter Agreement to me, keeping a copy for yourself.
Our sincerest wishes in your future endeavors.

	 	 	 	 	 
	Sincerely,

UDR, Inc.

 	 
	/s/ Thomas W. Toomey
 	 
	Thomas W. Toomey 	 
	Chief Executive Officer and President 	 
	 

	 	 	 	 	 	 	 	 	 	 	 
	Accepted and Agreed:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	12-27-07
	 	 
	 	By:
	 	/s/ Martha R. Carlin
	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Martha R. Carlin

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