Document:

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                                                                    EXHIBIT 10.2

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT is made as of the 22nd day of November, 1999,
by and between STRATTEC SECURITY CORPORATION, a Wisconsin corporation (the
"Company"), and Donald P. Klick (the "Employee").

                                     RECITAL

         The Company desires to employ the Employee and the Employee is willing
to make his services available to the Company on the terms and conditions set
forth below.

                                   AGREEMENTS

         In consideration of the premises and the mutual agreements which
follow, the parties agree as follows:

         1. Employment. The Company hereby employs the Employee and the Employee
hereby accepts employment with the Company on the terms and conditions set forth
in this Agreement.

         2. Term. The term of the Employee's employment hereunder shall commence
effective on November 22, 1999 and shall continue through June 30, 2000, and
shall thereafter be automatically renewed for successive fiscal year terms
unless either the Company or Employee gives notice of nonrenewal not less than
30 days prior to the end of the then current term (the "Employment Period").

         3. Duties. The Employee shall serve as the Vice President Business
Operations of the Company and will, under the direction of President and Chief
Operating Officer, faithfully and to the best of Employee's ability, perform the
duties of the Vice President Business Operations. Vice President Business
Operations shall be one of the principal executive officers of the Company and
shall, subject to the control of the President and Chief Operating Officer,
supervise the product business team functions of the Company. The Employee shall
also perform such additional duties and responsibilities which may from time to
time be reasonably assigned or delegated by the President and Chief Operating
Officer of the Company. The Employee agrees to devote Employee's entire business
time, effort, skill and attention to the proper discharge of such duties while
employed by the Company. However, the Employee may engage in other business
activities unrelated to, and not in conflict with, the business of the Company
if the President and Chief Operating Officer consents in writing to such other
business activity.

         4. Compensation. The Employee shall receive a base salary of $125,000
per year, payable in regular and semi-monthly installments (the "Base Salary").
Employee's Base Salary shall be reviewed annually by the Board of Directors of
the Company to determine appropriate increases, if any, in such Base Salary.

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         5. Fringe Benefits.

                  (a) Medical, Health, Dental, Disability and Life Coverage. The
Employee shall be eligible to participate in any medical, health, dental,
disability and life insurance policy in effect for senior management of the
Company (collectively, the "Senior Management").

                  (b) Incentive Bonus and Stock Ownership Plans. The Employee
shall be entitled to participate in any incentive bonus or other incentive
compensation plan developed generally for the Senior Management of the Company,
on a basis consistent with Employee's position and level of compensation with
the Company. The Employee shall also be entitled to participate in any incentive
stock option plan or other stock ownership plan developed generally for the
Senior Management of the Company, on a basis consistent with Employee's position
and level of compensation with the Company.

                  (c) Reimbursement for Reasonable Business Expenses. Subject to
the terms and conditions of the Company's expense reimbursement policy, the
Company shall pay or reimburse the Employee for reasonable expenses incurred by
Employee in connection with the performance of Employee's duties pursuant to
this Agreement, including, but not limited to, travel expenses, expenses in
connection with seminars, professional conventions or similar professional
functions and other reasonable business expenses.

         6. Termination of Employment.

                  (a) Termination for Cause, Disability or Death. During the
term of this Agreement, the Company shall be entitled to terminate the
Employee's employment at any time upon the "Disability" of the Employee or for
"Cause" upon notice to the Employee. The Employee's employment hereunder shall
automatically terminate upon the death of the Employee. For purposes of this
Agreement, "Disability" shall mean a physical or mental sickness or any injury
which renders the Employee incapable of performing the essential functions of
Employee's job (with or without reasonable accommodations) and which does or may
be expected to continue for more than 4 months during any 12-month period. In
the event Employee shall be able to perform the essential functions of
Employee's job (with or without reasonable accommodations) following a period of
disability, and does so perform such duties, or such other duties as are
prescribed by the President of the Company, for a period of three continuous
months, any subsequent period of disability shall be regarded as a new period of
disability for purposes of this Agreement. The Company and the Employee shall
determine the existence of a Disability and the date upon which it occurred. In
the event of a dispute regarding whether or when a Disability occurred, the
matter shall be referred to a medical doctor selected by the Company and the
Employee. In the event of their failure to agree upon such a medical doctor, the
Company and the Employee shall each select a medical doctor who together shall
select a third

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medical doctor who shall make the determination. Such determination shall be
conclusive and binding upon the parties hereto.

                           The Company may terminate the Employee's employment
under this agreement for "Cause," effective immediately upon delivery of notice
to the Employee. Cause shall be deemed to exist if the Employee shall have (1)
materially breached the terms of this Agreement; (2) willfully failed to
substantially perform his duties, other than a failure resulting from incapacity
due to physical or mental illness; or (3) serious misconduct which is
demonstrably and substantially injurious to the Company. No act or failure to
act will be considered "cause" if such act or failure is done in good faith and
with a reasonable belief that it is in the best interests of the Company.

                           In the event of termination for Disability or death,
payments of the Employee's Base Salary shall be made to the Employee, his
designated beneficiary or Employee's estate for a period of six months after the
date of the termination (even if this period would extend beyond the Employment
Period); provided, however that the foregoing payments in the event of a
Disability shall be reduced by the amount, if any, that is paid to Employee
pursuant to a disability plan or policy maintained by the Company. During this
period, the Company shall also reimburse the Employee for amounts paid, if any,
to continue medical, dental and health coverage pursuant to the provisions of
the Consolidated Omnibus Budget Reconciliation Act. During this period, the
Company will also continue Employee's life insurance and disability coverage, to
the extent permitted under applicable policies, and will pay to the Employee the
fringe benefits pursuant to section 5 which have accrued prior to the date of
termination. Termination of this Agreement for a Disability shall not change
Employee's rights to receive benefits, if any, pursuant to any disability plan
or policy then maintained by the Company.

                  (b) Termination Without Cause. If the Employee's employment is
terminated by the Company for any reason other than for Cause, Disability or
death, or if this Agreement is terminated by the Company for what the Company
believes is Cause or Disability, and it is ultimately determined that the
Employee was wrongfully terminated, Employee shall, as damages for such a
termination, receive Employee's Base Salary, for the remainder of the Employment
Period or six months, if longer. During this period, the Company shall also
reimburse the Employee for amounts paid, if any, to continue medical, dental and
health coverage pursuant to the provisions of the Consolidated Omnibus Budget
Reconciliation Act. During this period, the Company will also continue
Employee's life insurance and disability coverage, to the extent permitted under
applicable policies, and will pay to the Employee the fringe benefits pursuant
to section 5 which have accrued prior to the date of termination. The Company's
termination of the Employee's employment under this section 6(b) shall
immediately relieve the Employee of all obligations under this Agreement (except
as provided in sections 7 and 8) and, except as provided below, shall not be
construed to require the application of any compensation which the Employee may
earn in any such other employment to reduce the Company's obligation to provide
severance benefits and liquidated damages under this section 6(b).

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                  (c) Effect of Termination. The termination of the Employee's
employment pursuant to section 6 shall not affect the Employee's obligations as
described in sections 7 and 8.

         7. Noncompetition. The parties agree that the Company's customer
contacts and relations are established and maintained at great expense and by
virtue of the Employee's employment with the Company, the Employee will have
unique and extensive exposure to and personal contact with the Company's
customers, and that Employee will be able to establish a unique relationship
with those individuals and entities that will enable Employee, both during and
after employment, to unfairly compete with the Company. Further, the parties
agree that the terms and conditions of the following restrictive covenants are
reasonable and necessary for the protection of the Company's business, trade
secrets and confidential information and to prevent great damage or loss to the
Company as a result of action taken by the Employee. The Employee acknowledges
that the noncompete restrictions and nondisclosure of confidential information
restrictions contained in this Agreement are reasonable and the consideration
provided for herein is sufficient to fully and adequately compensate the
Employee for agreeing to such restrictions. The Employee acknowledges that
Employee could continue to actively pursue Employee's career and earn sufficient
compensation in the same or similar business without breaching any of the
restrictions contained in this Agreement.

                  (a) During Term of Employment. The Employee hereby covenants
and agrees that, during Employee's employment with the Company, Employee shall
not, directly or indirectly, either individually or as an employee, principal,
agent, partner, shareholder, owner, trustee, beneficiary, co-venturer,
distributor, consultant or in any other capacity, participate in, become
associated with, provide assistance to, engage in or have a financial or other
interest in any business, activity or enterprise which is competitive with or a
supplier to the Company or any successor or assign of the Company. The ownership
of less than a one percent interest in a corporation whose shares are traded in
a recognized stock exchange or traded in the over-the-counter market, even
though that corporation may be a competitor of the Company, shall not be deemed
financial participation in a competitor.

                  (b) Upon Termination of Employment. The Employee agrees that
during a period after termination of Employee's employment with the Company
equal to the shorter of one year or the duration of Employee's employment with
the Company, Employee will not, directly or indirectly, either individually or
as an employee, agent, partner, shareholder, owner, trustee, beneficiary,
co-venturer, distributor, consultant or in any other capacity:

                           (i) Canvass, solicit or accept from any person or
entity who is a customer of the Company (any such person or entity is
hereinafter referred to individually as a "Customer" and collectively as the
"Customers") any business in competition with the business of the Company or the
successors or assigns of the Company, including the canvassing, soliciting or
accepting of business from any individual

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or entity which is or was a Customer of the Company within the two-year period
preceding the date on which the canvassing, soliciting or accepting of business
begins.

                           (ii) Request or advise any of the Customers,
suppliers, or other business contacts of the Company who currently have or have
had business relationships with the Company within two years preceding the date
hereof or within two years preceding the date of such action, to withdraw,
curtail or cancel any of their business or relations with the Company.

                           (iii) Induce or attempt to induce any employee, sales
representative, consultant or other personnel of the Company to terminate his or
her relationship or breach his or her agreements with the Company.

                           (iv) Use, disclose, divulge or transmit or cause to
be used by or disclosed, divulged or transmitted to any third party, any
information acquired by the Employee during the Employment Period which relates
to the trade secrets and confidential information of the Company, except as may
be required by law.

                           (v) Participate in, become associated with, provide
assistance to, engage in or have a financial or other interest in any business,
activity or enterprise which is competitive with the business of the Company or
any successor or assign of the Company to the extent such activities relate to
products or services which are competitive with the products and services of the
Company; provided, however, that the ownership of less than 1% of the stock of a
corporation whose shares are traded in a recognized stock exchange or traded in
the over-the-counter market, even though that corporation may be a competitor of
the Company, shall not be deemed financial participation in a competitor.

                                    For purposes of this section 7, a
competitive business is defined as a business which is involved in designing,
developing, manufacturing or marketing mechanical, electro-mechanical and/or
electronic security and access control products in the global motor vehicle
industry.

         8. Confidential Information. The parties agree that the Company's
customers, business connections, suppliers, customer lists, procedures,
operations, techniques, and other aspects of its business are established at
great expense and protected as confidential information and provide the Company
with a substantial competitive advantage in conducting its business. The parties
further agree that by virtue of the Employee's employment with the Company,
Employee will have access to, and be entrusted with, secret, confidential and
proprietary information, and that the Company would suffer great loss and injury
if the Employee would disclose this information or use it to compete with the
Company. Therefore, the Employee agrees that during the term of Employee's
employment, and for a period of two years after the termination of his
employment with the Company, Employee will not, directly or indirectly, either
individually or as an employee, agent, partner, shareholder, owner, trustee,
beneficiary,

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co-venturer, distributor, consultant or in any other capacity, use or disclose,
or cause to be used or disclosed, any secret, confidential or proprietary
information acquired by the Employee during Employee's employment with the
Company whether owned by the Company prior to or discovered and developed by the
Company subsequent to the Employee's employment, and regardless of the fact that
the Employee may have participated in the discovery and the development of that
information. Employee also agrees and acknowledges that Employee will comply
with all applicable laws regarding insider trading or the use of material
nonpublic information in connection with the trading of securities.

         9. Common Law of Torts and Trade Secrets. The parties agree that
nothing in this Agreement shall be construed to limit or negate the common law
of torts or trade secrets where it provides the Company with broader protection
than that provided herein.

         10. Specific Performance. The Employee acknowledges and agrees that
irreparable injury to the Company may result in the event the Employee breaches
any covenant and agreement contained in sections 7 and 8 and that the remedy at
law for the breach of any such covenant will be inadequate. Therefore, if the
Employee engages in any act in violation of the provisions of sections 7 and 8,
the Employee agrees that the Company shall be entitled, in addition to such
other remedies and damages as may be available to it by law or under this
Agreement, to injunctive relief to enforce the provisions of sections 7 and 8.

         11. Waiver. The failure of either party to insist, in any one or more
instances, upon performance of the terms or conditions of this Agreement shall
not be construed as a waiver or a relinquishment of any right granted hereunder
or of the future performance of any such term, covenant or condition.

         12. Notices. Any notice to be given hereunder shall be deemed
sufficient if addressed in writing, and delivered by registered or certified
mail or delivered personally, in the case of the Company, to its principal
business office, and in the case of the Employee, to his address appearing on
the records of the Company, or to such other address as he may designate in
writing to the Company.

         13. Severability. In the event that any provision shall be held to be
invalid or unenforceable for any reason whatsoever, it is agreed such invalidity
or unenforceability shall not affect any other provision of this Agreement and
the remaining covenants, restrictions and provisions hereof shall remain in full
force and effect and any court of competent jurisdiction may so modify the
objectionable provision as to make it valid, reasonable and enforceable.
Furthermore, the parties specifically acknowledge the above covenant not to
compete and covenant not to disclose confidential information are separate and
independent agreements.

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         14. Amendment. This Agreement may only be amended by an agreement in
writing signed by all of the parties hereto.

         15. Governing Law. This Agreement shall be governed by and construed
exclusively in accordance with the laws of the State of Wisconsin, regardless of
choice of law requirements. The parties hereby consent to the jurisdiction of
the state courts of the State of Wisconsin and of any federal court in the venue
of Wisconsin for the purpose of any suit, action or proceeding arising out of or
related to this Agreement, and expressly waive any and all objections they may
have as to venue in any of such courts.

         16. Dispute Resolution. The parties hereto shall attempt to resolve
disputes arising out of or relating to this Agreement. Any dispute not resolved
in writing within 21 days may be referred by either party to mediation involving
a mediator (a third party neutral), trained and experienced in the mediation
process and mutually agreed to by the parties. The mediator shall ascribe to and
follow the AAA/SPIDR or ABA code of ethics for mediators in conduct and
management of the mediation process. Expenses for the mediation shall be shared
equally by the parties unless otherwise agreed during the mediation process. The
parties may be accompanied in the mediation process by legal counsel, and/or
other persons mutually agreed to by the parties and the mediator. All
participants will openly and honestly participate in the mediation. The
mediation may be terminated at any time, for any reason by the mediator or by
either party. Any resolution reached by the parties during the mediation shall
be recorded in writing and agreed to by the parties. Such resolution may be
drafted and/or revised by the parties' legal counsel and shall be legally
binding on the parties.

         17. Benefit. This Agreement shall be binding upon and inure to the
benefit of and shall be enforceable by and against the Company, its successors
and assigns and the Employee, his heirs, beneficiaries and legal
representatives. It is agreed that the rights and obligations of the Employee
may not be delegated or assigned.

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

EMPLOYEE                                   STRATTEC SECURITY CORPORATION

/s/ Donald P. Klick                        BY /s/ Harold M. Stratton II
----------------------------                 --------------------------------
Donald P. Klick                            Harold M. Stratton II,
                                           Chairman of the Board
                                           and Chief Executive Officer

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                                                                    EXHIBIT 10.3

                              EMPLOYMENT AGREEMENT

         AGREEMENT by and between STRATTEC SECURITY CORPORATION, a Wisconsin
corporation (the "Company") and Donald P. Klick (the "Executive"), dated as of
the 22nd day of November, 1999.

         The Board of Directors of the Company (the "Board"), has determined
that it is in the best interests of the Company and its shareholders to assure
that the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined below) of the Company. The Board believes it is imperative to diminish
the inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change of Control and
to encourage the Executive's full attention and dedication to the Company
currently and in the event of any threatened or pending Change of Control, and
to provide the Executive with compensation and benefits arrangements upon a
Change of Control which ensure that the compensation and benefits expectations
of the Executive will be satisfied and which are competitive with those of other
corporations. Therefore, in order to accomplish these objectives, the Board has
caused the Company to enter into this Agreement.

         NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

         1. Certain Definitions.

            (a) The "Effective Date" shall mean the first date during the Change
of Control Period (as defined in Section l(b)) on which a Change of Control (as
defined in Section 2) occurs. Anything in this Agreement to the contrary
notwithstanding, if a Change of Control occurs and if the Executive's employment
with the Company or this Agreement is terminated prior to the date on which the
Change of Control occurs, and if it is reasonably demonstrated by the Executive
that such termination of employment or of this Agreement (i) was at the request
of a third party who has taken steps reasonably calculated to effect a Change of
Control or (ii) otherwise arose in connection with or anticipation of a Change
of Control, then for all purposes of this Agreement the "Effective Date" shall
mean the date immediately prior to the date of such termination of employment or
purported termination of this Agreement.

            (b) The "Change of Control Period" shall mean the period commencing
on the date hereof and ending on the third anniversary of the date hereof;
provided, however, that commencing on the date one year after the date hereof,
and on each annual anniversary of such date (such date and each annual
anniversary thereof shall be hereinafter referred to as the "Renewal Date"),
unless previously terminated, the Change of Control Period shall be
automatically extended so as to terminate three years from such Renewal Date,
unless at least 60 days prior to the Renewal Date the Company

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shall give notice to the Executive that the Change of Control Period shall not
be so extended.

         2. Change of Control. For the purpose of this Agreement, a "Change of
Control" shall mean:

            (a) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of
either (i) the then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (ii) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that the following acquisitions shall not constitute a Change
of Control: (i) any acquisition directly from the Company, (ii) any acquisition
by the Company, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation controlled by
the Company or (iv) any acquisition by any corporation pursuant to a transaction
which complies with clauses (i), (ii) and (iii) of subsection (c) of this
Section 2; or

            (b) Individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or

            (c) Approval by the shareholders of the Company of a reorganization,
merger or consolidation (a "Business Combination"), in each case, unless,
following such Business Combination, (i) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 60% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction owns the
Company through one or more subsidiaries) in substantially the same proportions
as their ownership, immediately prior to such Business Combination of the
Outstanding Company Common Stock and Outstanding Company Voting Securities,

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as the case may be, (ii) no Person (excluding any employee benefit plan (or
related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation except to the extent that
such ownership existed prior to the Business Combination and (iii) at least a
majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or

            (d) Approval by the shareholders of the Company of (i) a complete
liquidation or dissolution of the Company or (ii) the sale or other disposition
of all or substantially all of the assets of the Company, other than to a
corporation, with respect to which following such sale or other disposition, [a]
more than 60% of, respectively, the then outstanding shares of common stock of
such corporation and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and outstanding
Company Voting Securities immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately prior to such
sale or other disposition, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, [b] less than 20% of,
respectively, the then outstanding shares of common stock of such corporation
and the combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by any Person (excluding any
employee benefit plan (or related trust) of the Company or such corporation),
except to the extent that such Person owned 20% or more of the Outstanding
Company Common Stock or Outstanding Company Voting Securities prior to the sale
or disposition, and [c] at least a majority of the members of the board of
directors of such corporation were members of the Incumbent Board at the time of
the execution of the initial agreement, or of the action of the Board, providing
for such sale or other disposition of assets of the Company or were elected,
appointed or nominated by the Board.

         3. Employment Period. The Company hereby agrees to continue the
Executive in its employ, and the Executive hereby agrees to remain in the employ
of the Company subject to the terms and conditions of this Agreement, for the
period commencing on the Effective Date and ending on the third anniversary of
such date (the "Employment Period").

         4. Terms of Employment.

            (a) Position and Duties.

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                (i) During the Employment Period, [a] the Executive's position
(including status, offices, titles and reporting requirements), authority,
duties and responsibilities shall be at least commensurate in all material
respects with the most significant of those held, exercised and assigned at any
time during the 120-day period immediately preceding the Effective Date and [b]
the Executive's services shall be performed at the location where the Executive
was employed immediately preceding the Effective Date or any office or location
less than 35 miles from such location.

                (ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive agrees
to devote reasonable attention and time during normal business hours to the
business and affairs of the Company and, to the extent necessary to discharge
the responsibilities assigned to the Executive hereunder, to use the Executive's
reasonable best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period it shall not be a violation of
this Agreement for the Executive to [a] serve on corporate, civic or charitable
boards or committees, [b] deliver lectures, fulfill speaking engagements or
teach at educational institutions and [c] manage personal investments, so long
as such activities do not significantly interfere with the performance of the
Executive's responsibilities as an employee of the Company in accordance with
this Agreement. It is expressly understood and agreed that to the extent that
any such activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of activities
similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive's
responsibilities to the Company.

            (b) Compensation.

                (i) Base Salary. During the Employment Period, the Executive
shall receive an annual base salary ("Annual Base Salary"), which shall be paid
at a monthly rate, at least equal to twelve times the highest monthly base
salary paid or payable, including any base salary which has been earned but
deferred, to the Executive by the Company and its affiliated companies in
respect of the 12-month period immediately preceding the month in which the
Effective Date occurs. During the Employment Period, the Annual Base Salary
shall be reviewed no more than 12 months after the last salary increase awarded
to the Executive prior to the Effective Date and thereafter at least annually
and shall be first increased no more than 12 months after the last salary
increase awarded to the Executive prior to the Effective Date and thereafter at
least annually by the higher of (x) the average increase (excluding promotional
increases) in base salary awarded to the Executive for each of the three full
fiscal years (annualized in the case of any fiscal year consisting of less than
twelve full months or during which the Executive was employed for less than
twelve months) prior to the Effective Date, and (y) the percentage increase
(excluding promotional increases) in base salary generally awarded to peer
executives of the Company and its affiliated companies for the year of
determination. Any increase in Annual Base Salary shall not serve to limit or
reduce any

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other obligation to the Executive under this Agreement. Annual Base Salary shall
not be reduced after any such increase and the term Annual Base Salary as
utilized in this Agreement shall refer to Annual Base Salary as so increased. As
used in this Agreement, the term "affiliated companies" shall include any
company controlled by, controlling or under common control with the Company.

                (ii) Annual Bonus. In addition to Annual Base Salary, the
Executive shall be awarded, for each fiscal year ending during the Employment
Period, an annual bonus (the "Annual Bonus") in cash at least equal to the
higher of (x) the average of the three highest bonuses paid or payable,
including any bonus or portion thereof which has been earned but deferred, to
the Executive by the Company and its affiliated companies in respect of the five
fiscal years (or such shorter period during which the Executive has been
employed by the Company) immediately preceding the fiscal year in which the
Effective Date occurs (annualized for any fiscal year during such period
consisting of less than twelve full months or with respect to which the
Executive has been employed by the Company for less than twelve full months) and
(y) the bonus paid or payable (annualized as described above), including any
bonus or portion thereof which has been earned but deferred, to the Executive by
the Company and its affiliated companies in respect of the most recently
completed fiscal year prior to the Effective Date (such higher amount being
referred to as the "Recent Annual Bonus"). Each such Annual Bonus shall be paid
no later than the end of the third month of the fiscal year next following the
fiscal year for which the Annual Bonus is awarded, unless the Executive shall
elect to defer the receipt of such Annual Bonus.

                (iii) Incentive, Savings and Retirement Plans. During the
Employment Period, the Executive shall be entitled to participate in all
incentive, savings and retirement plans, practices, policies and programs
applicable generally to other peer executives of the Company and its affiliated
companies, but in no event shall such plans, practices, policies and programs
provide the Executive with incentive opportunities (measured with respect to
both regular and special incentive opportunities, to the extent, if any, that
such distinction is applicable), savings opportunities and retirement benefit
opportunities, in each case, less favorable, in the aggregate, than the most
favorable of those provided by the Company and its affiliated companies for the
Executive under such plans, practices, policies and programs as in effect at any
time during the 120-day period immediately preceding the Effective Date or if
more favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and its affiliated
companies.

                (iv) Welfare Benefit Plans. During the Employment Period, the
Executive and/or the Executive's family, as the case may be, shall be eligible
for participation in and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by the Company and its affiliated
companies (including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life, accidental death and
travel accident insurance plans and programs) to the extent applicable generally
to other peer executives of the Company and its affiliated

                                       5
<PAGE>   6

companies, but in no event shall such plans, practices, policies and programs
provide the Executive with benefits which are less favorable, in the aggregate,
than the most favorable of such plans, practices, policies and programs in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, those
provided generally at any time after the Effective Date to other peer executives
of the Company and its affiliated companies.

                (v) Expenses. During the Employment Period, the Executive shall
be entitled to receive prompt reimbursement for all reasonable expenses incurred
by the Executive in accordance with the most favorable policies, practices and
procedures of the Company and the affiliated companies in effect for the
Executive at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to other peer executives of the Company and its
affiliated companies.

                (vi) Fringe Benefits. During the Employment Period, the
Executive shall be entitled to fringe benefits, including, without limitation,
tax and financial planning services, payment of club dues, and, if applicable,
use of automobile and payment of related expenses, in accordance with the most
favorable plans, practices, programs and policies of the Company and its
affiliated companies in effect for the Executive at any time during the 120-day
period immediately preceding the Effective Date or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies.

                (vii) Office and Support Staff. During the Employment Period,
the Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments, and to exclusive personal secretarial and
other assistance, at least equal to the most favorable of the foregoing provided
to the Executive by the Company and its affiliated companies at any time during
the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive, as provided generally at any time thereafter with
respect to other peer executives of the Company and its affiliated companies.

                (viii) Vacation. During the Employment Period, the Executive
shall be entitled to paid vacation in accordance with the most favorable plans,
policies, programs and practices of the Company and its affiliated companies as
in effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other peer executives of
the Company and its affiliated companies.

         5. Termination of Employment.

            (a) Death or Disability. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period. If the

                                       6
<PAGE>   7

Company determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), it may give to the Executive written notice in accordance with
Section 12(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the "Disability Effective Date"), provided that, within the 30 days
after such receipt, the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
with the Company on a full-time basis for 180 consecutive business days as a
result of incapacity due to mental or physical illness which is determined to be
total and permanent by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive's legal representative (such
agreement as to acceptability not to be withheld unreasonably).

            (b) Cause. The Company may terminate the Executive's employment
during the Employment Period for Cause. For the sole and exclusive purposes of
this Agreement, "Cause" shall mean:

                (i) The willful and continued failure of the Executive to
perform substantially the Executive's duties with the Company or one of its
affiliates (other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial performance
is delivered to the Executive by the Board or the Chief Executive Officer of the
Company which specifically identifies the manner in which the Board or Chief
Executive Officer believes that the Executive has not substantially performed
the Executive's duties, or

                (ii) The willful engaging by the Executive in illegal conduct or
gross misconduct which is materially and demonstrably injurious to the Company.

For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the Chief Executive Officer or
a senior officer of the Company or based upon the advice of counsel for the
Company shall be conclusively presumed to be done, or omitted to be done, by the
Executive in good faith and in the best interests of the Company. The cessation
of employment of the Executive shall not be deemed to be for Cause unless and
until there shall have been delivered to the Executive a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for
such purpose (after reasonable notice is provided to the Executive and the
Executive is given an opportunity, together with counsel, to be heard before the
Board), finding that, in the good faith opinion of the Board, the

                                       7
<PAGE>   8

Executive is guilty of the conduct described in subparagraph (i) or (ii) above,
and specifying the particulars thereof in detail.

            (c) Good Reason. The Executive's employment may be terminated by the
Executive for Good Reason. For the sole and exclusive purposes of this
Agreement, "Good Reason" shall mean:

                (i) The assignment to the Executive of any duties inconsistent
in any respect with the Executive's position (including status, offices, titles
and reporting requirements), authority, duties or responsibilities as
contemplated by Section 4(a) of this Agreement, or any other action by the
Company which results in a diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive;

                (ii) Any failure by the Company to comply with any of the
provisions of Section 4(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive;

                (iii) The Company's requiring the Executive to be based at any
office or location other than as provided in Section 4(a)(i)(b) hereof or the
Company's requiring the Executive to travel on Company business to a
substantially greater extent than required immediately prior to the Effective
Date;

                (iv) Any purported termination by the Company of the Executive's
employment otherwise than as expressly permitted by this Agreement; or

                (v) Any failure by the Company to comply with and satisfy
Section 11(c) of this Agreement.

For purposes of this Section 5(c), any good faith determination of "Good Reason"
made by the Executive shall be conclusive. Anything in this Agreement to the
contrary notwithstanding, a termination by the Executive for any reason during
the 30-day period immediately following the first anniversary of the Effective
Date shall be deemed to be a termination for Good Reason for all purposes of
this Agreement.

            (d) Notice of Termination. Any termination by the Company for Cause,
or by the Executive for Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 12(b) of
this Agreement. For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment

                                       8
<PAGE>   9

under the provision so indicated, and (iii) if the Date of Termination (as
defined below) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than thirty days after the giving
of such notice). The failure by the Executive or the Company to set forth in the
Notice of Termination any fact or circumstance which contributes to a showing of
Good Reason or Cause shall not waive any right of the Executive or the Company,
respectively, hereunder or preclude the Executive or the Company, respectively,
from asserting such fact or circumstance in enforcing the Executive's or the
Company's rights hereunder.

            (e) Date of Termination. "Date of Termination" means (i) if the
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than for Cause or Disability, the
Date of Termination shall be the date on which the Company notifies the
Executive of such termination, and (iii) if the Executive's employment is
terminated by reason of death or Disability, the Date of Termination shall be
the date of death of the Executive or the Disability Effective Date, as the case
may be.

         6. Obligations of the Company upon Termination.

            (a) Good Reason; Other Than for Cause, Death or Disability. If,
during the Employment Period, the Company shall terminate the Executive's
employment other than for Cause, death or Disability or the Executive shall
terminate employment for Good Reason:

                (i) The Company shall pay to the Executive in a lump sum in cash
within 30 days after the Date of Termination the aggregate of the following
amounts:

                    [a] The sum of [i] the Executive's Annual Base Salary
through the Date of Termination to the extent not theretofore paid, [ii] the
product of (x) the higher of [A] the Recent Annual Bonus and [B] the Annual
Bonus paid or payable, including any bonus or portion thereof which has been
earned but deferred (and annualized for any fiscal year consisting of less than
12 full months or during which the Executive was employed for less than 12 full
months), for the most recently completed fiscal year during the Employment
Period, if any (such higher amount being referred to as the "Highest Annual
Bonus") and (y) a fraction, the numerator of which is the number of days in the
current fiscal year through the Date of Termination, and the denominator of
which is 365 and [iii] any compensation previously deferred by the Executive
(together with any accrued interest or earnings thereon) and any accrued
vacation pay, in each case to the extent not theretofore paid (the sum of the
amounts described in clauses [i], [ii] and [iii] shall be hereinafter referred
to as the "Accrued Obligations"); and

                                       9
<PAGE>   10

                    [b] The amount equal to the product of [i] three and [ii]
the sum of (x) the Executive's Annual Base Salary and (y) the Highest Annual
Bonus; and

                    [c] An amount equal to the difference between [i] the
actuarial equivalent of the benefit (utilizing actuarial assumptions no less
favorable to the Executive than those in effect under the Retirement Plan (as
defined below) immediately prior to the Effective Date, except as specified
below with respect to increases in base salary and annual bonus) under the
qualified defined benefit retirement plan in which the Executive participates
(the "Retirement Plan") and any excess or supplemental retirement plan in which
the Executive participates (together, the "SERP") which the Executive would
receive if the Executive's employment continued for three years after the Date
of Termination assuming for this purpose that all accrued benefits are fully
vested, and, assuming that (x) the Executive's base salary increased in each of
the three years by the amount required by Section 4(b)(i) (in the case of
Section 4-(b)(i)(y) based on increases (excluding promotional increases) in base
salary for the most recently completed fiscal year prior to the Date of
Termination) had the Executive remained employed, and (y) the Executive's annual
bonus (annualized for any fiscal year consisting of less than twelve full months
or during which the Executive was employed for less than twelve full months) in
each of the three years bears the same proportion to the Executive's base salary
in such year or fraction thereof as it did for the last full year prior to the
Date of Termination, and [ii] the actuarial equivalent of the Executive's actual
benefit (paid or payable), if any, under the Retirement Plan and the SERP as of
the Date of Termination;

                (ii) For three years after the Executive's Date of Termination,
or such longer period as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal to those which would have
been provided to them in accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) of this Agreement if the Executive's
employment had not been terminated in accordance with the most favorable plans,
practices, programs or policies of the Company and its affiliated companies
applicable generally to other peer executives and their families during the
120-day period immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect generally at any time thereafter with respect to
other peer executives of the Company and its affiliated companies and their
families, provided, however, that if the Executive becomes reemployed with
another employer and is eligible to receive medical or other welfare benefits
under another employer provided plan, the medical and other welfare benefits
described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility. For purposes of determining
eligibility (but not the time of commencement of benefits) of the Executive for
retiree benefits pursuant to such plans, practices, programs and policies, the
Executive shall be considered to have remained employed until two and one-half
years after the Date of Termination and to have retired on the last day of such
period;

                                       10
<PAGE>   11

                (iii) The Company shall, at its sole expense as incurred,
provide the Executive with outplacement services the scope and provider of which
shall be selected by the Executive in his sole discretion; and

                (iv) To the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company and its affiliated companies (such other amounts and benefits shall be
hereinafter referred to as the "Other Benefits").

            (b) Death. If the Executive's employment is terminated by reason of
the Executive's death during the Employment Period, this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be paid
to the Executive's estate or beneficiary, as applicable, in a lump sum in cash
within 30 days of the Date of Termination. With respect to the provision of
Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall
include, without limitation, and the Executives estate and/or beneficiaries
shall be entitled to receive, benefits at least equal to the most favorable
benefits provided by the Company and affiliated companies to the estates and
beneficiaries of peer executives of the Company and such affiliated companies
under such plans, programs, practices and policies relating to death benefits,
if any, as in effect with respect to other peer executives and their
beneficiaries at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive's estate and/or the
Executive's beneficiaries, as in effect on the date of the Executive's death
with respect to other peer executives of the Company and its affiliated
companies and their beneficiaries.

            (c) Disability. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations and the timely payment or provision of
Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination. With respect to the provision
of Other Benefits, the term Other Benefits as utilized in this Section 6(c)
shall include, and the Executive shall be entitled after the Disability
Effective Date to receive, disability and other benefits at least equal to the
most favorable of those generally provided by the Company and its affiliated
companies to disabled executives and/or their families in accordance with such
plans, programs, practices and policies relating to disability, if any, as in
effect generally with respect to other peer executives and their families at any
time during the 120-day period immediately preceding the Effective Date or, if
more favorable to the Executive and/or the Executive's family, as in effect at
any time thereafter generally with respect to other peer executives of the
Company and its affiliated companies and their families.

                                       11
<PAGE>   12

            (d) Cause; Other than for Good Reason. If the Executive's employment
shall be terminated for Cause during the Employment Period, this Agreement shall
terminate without further obligations to the Executive other than the obligation
to pay to the Executive (i) his Annual Base Salary through the Date of
Termination, (ii) the amount of any compensation previously deferred by the
Executive, and (iii) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Employment
Period, excluding a termination for Good Reason, this Agreement shall terminate
without further obligations to the Executive, other than for Accrued Obligations
and the timely payment or provision of Other Benefits. In such case, all Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination.

         7. Nonexclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company or any of its affiliated companies
and for which the Executive may qualify, nor shall anything herein limit or
otherwise affect such rights as the Executive may have under any contract or
agreement with the Company or any of its affiliated companies. Amounts which are
vested benefits or which the Executive is otherwise entitled to receive under
any plan, policy, practice or program of or any contract or agreement with the
Company or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or
program or contract or agreement except as explicitly modified by this
Agreement.

         8. Full Settlement. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement and such amounts
shall not be reduced whether or not the Executive obtains other employment. The
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees and expenses which the Executive may reasonably incur as a result of
any contest (regardless of the outcome thereof) by the Company, the Executive or
others of the validity or enforceability of, or liability under, any provision
of this Agreement or any guarantee of performance thereof (including as a result
of any contest by the Executive about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment at the applicable
Federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code
of 1986, as amended (the "Code").

         9. Certain Additional Payments by the Company.

            (a) Anything in this Agreement to the contrary notwithstanding, in
the event it shall be determined that any payment or distribution by the Company
to or for the benefit of the Executive (whether paid or payable or distributed

                                       12
<PAGE>   13

or distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
9) (a "Payment") would be subject to the excise tax imposed by Section 4999 of
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.

            (b) Subject to the provisions of Section 9(c), all determinations
required to be made under this Section 9, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by Arthur
Andersen & Co. or such other certified public accounting firm as may be
designated by the Executive (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the Executive within 15 business
days of the receipt of notice from the Executive that there has been a Payment,
or such earlier time as is requested by the Company. In the event that the
Accounting Firm is serving as accountant or auditor for the individual, entity
or group effecting the Change of Control, the Executive shall appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to this
Section 9, shall be paid by the Company to the Executive within five days of the
receipt of the Accounting Firm's determination. If the Accounting Firm
determines that no Excise Tax is payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report the Excise Tax on the
Executive's applicable federal income tax return would not result in the
imposition of a negligence or similar penalty. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result
of the uncertainty in the application of Section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies pursuant to
Section 9(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.

            (c) The Executive shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment. Such notification shall be given as soon
as

                                       13
<PAGE>   14

practicable but no later than ten business days after the Executive is informed
in writing of such claim and shall apprise the Company of the nature of such
claim and the date on which such claim is requested to be paid. The Executive
shall not pay such claim prior to the expiration of the 30-day period following
the date on which it gives such notice to the Company (or such shorter period
ending on the date that any payment of taxes with respect to such claim is due).
If the Company notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:

                (i) Give the Company any information reasonably requested by the
Company relating to such claim,

                (ii) Take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,

                (iii) Cooperate with the Company in good faith in order
effectively to contest such claim, and

                (iv) Permit the Company to participate in any proceedings
relating to such claim; provided, however, that the Company shall bear and pay
directly all costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 9(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

                                       14
<PAGE>   15

            (d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 9(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 9(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Section 9(c), a determination
is made that the Executive shall not be entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

         10. Confidential Information. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies,
and their respective businesses, which shall have been obtained by the Executive
during the Executive's employment by the Company or any of its affiliated
companies and which shall not be or become public knowledge (other than by acts
by the Executive or representatives of the Executive in violation of this
Agreement). After termination of the Executive's employment with the Company,
the Executive shall not, without the prior written consent of the Company or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Company and those
designated by it. In no event shall an asserted violation of the provisions of
this Section 10 constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement.

         11. Successors.

            (a) This Agreement is personal to the Executive and without the
prior written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.

            (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

            (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its

                                       15
<PAGE>   16

business and/or assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise.

         12. Miscellaneous.

            (a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Wisconsin, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.

            (b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

If to the Executive, to his address appearing on the records of the Company.

If to the Company:

                           STRATTEC SECURITY CORPORATION
                           3333 West Good Hope Road
                           Milwaukee, WI 53209
                           Attn:  President

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

            (c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.

            (d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.

            (e) The Executive's or the Company's failure to insist upon strict
compliance with any provision hereof or any other provision of this Agreement or
the failure to assert any right the Executive or the Company may have hereunder,
including, without limitation, the right of the Executive to terminate
employment for Good Reason pursuant to Section 5(c)(i)-(v) of this Agreement,
shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Agreement.

                                       16
<PAGE>   17

            (f) The Executive and the Company acknowledge that, except as may
otherwise be provided under any other written agreement between the Executive
and the Company, the employment of the Executive by the Company is "at will"
and, prior to the Effective Date, the Executive's employment and this Agreement
may be terminated by either the Executive or the Company at any time prior to
the Effective Date, in which case the Executive shall have no further rights
under this Agreement. From and after the Effective Date this Agreement shall
supersede any other agreement between the parties with respect to the subject
matter hereof.

         IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

                                      /s/ Donald P. Klick
                                      ----------------------------------
                                                 Donald P. Klick

                                      STRATTEC SECURITY CORPORATION

                                      BY /s/ Harold M. Stratton, II
                                        --------------------------------
                                           Harold M. Stratton, II,
                                           Chairman of the Board
                                        and Chief Executive Officer

                                       17

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