Document:

exv10w1

 

Exhibit 10.1

SECOND AMENDMENT TO EMPLOYMENT AGREEMENT

     This SECOND AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is made and entered into this
18th day of December, 2006 by and between Optelecom-NKF, Inc., a Delaware corporation
(the “Company”), and Edmund Ludwig, an individual (“Employee”). All capitalized terms used and not
defined herein shall have the respective meanings as set forth in the Employment Agreement between
the Company and Employee dated as of November 4, 2002 (the “Employment Agreement”).

     WHEREAS the Company and Employee have entered into the Employment Agreement setting forth the
terms and conditions of Employee’s employment by the Company; and

     WHEREAS the Company and Employee are desirous of amending the Employment Agreement and this
Amendment has been reviewed and approved by the Compensation Committee of the Board of Directors of
the Company.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in the
Employment Agreement and herein, the parties agree as follows:

1. Paragraph 4(a) of the Employment Agreement is hereby deleted in its entirety and replaced with
the following:

     (a) Base Salary. For calendar year 2006, Employee shall be paid a base
salary in the annualized amount of not less than $231,000 payable in accordance with
the general practice of the Company (adjusted as if in effect for the full year
commencing January 1, 2006), subject to any and all customary payroll deductions for
the FICA and any other federal, state and local taxes. Commencing January 1, 2007,
Employee shall be paid a base salary in the annualized amount of not less than
$242,000, payable in substantially equal bi-monthly or other installments in
accordance with the general practice of the Company, subject to any and all
customary payroll deductions for the FICA and any other federal, state and local
taxes. Employee’s base salary will be reviewed annually and subject to adjustment
by the Compensation Committee of the Board of Directors, in its sole discretion.

2. Paragraph 4(b) of the Employment Agreement is hereby deleted in its entirety and replaced with
the following:

     (b) Bonus. Employee shall be eligible for an annual bonus based upon
Employee’s individual performance and specified sales, sales growth and
profitability goals and objectives for the Company to be developed annually in good
faith by the Compensation Committee of the Board of Directors, in consultation with
Employee. For calendar years 2006 and 2007, Employee shall be entitled to receive
cash and

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equity incentives set forth in the Company’s incentive compensation program approved
by the Compensation Committee, in its sole discretion, for such years upon
satisfaction of the criteria set forth in such programs, with a cash incentive
target equal to 55% of the current base salary for that year upon the achievement of
100% of target performance scalable above and below the target.

3. Paragraph 4 of the Employment Agreement is hereby further amended by adding a new clause (d)
that provides as follows:

     (d) Additional Cash Payment for Qualifying Service. If Employee is
engaged in a Qualifying Service (as defined in Section 16) on December 31, 2006,
then he shall be entitled to an additional cash payment of $46,000, payable in a
lump sum on January 2, 2007, subject to any and all customary payroll deductions for
the FICA and any other federal, state and local taxes. If Employee is engaged in a
Qualifying Service (as defined in Section 16) on December 31, 2007, then he shall be
entitled to an additional cash payment of $60,000, payable in a lump sum on January
2, 2008, subject to any and all customary payroll deductions for the FICA and any
other federal, state and local taxes.

4. Paragraph 14(e) of the Employment Agreement is hereby deleted in its entirety and replaced with
the following:

	 	(e)	 	If this Agreement is terminated pursuant to Paragraph 14(a)(iv) above,
Employee shall be entitled to receive his Base Salary for a period of twelve
(12) months following termination and any bonus earned through the termination
date. Employee shall also receive any and all employee benefits accrued
through the termination date, the amount, form and payment of which shall be
determined in accordance with the terms of such employee benefit plans then in
place at the Company. Notwithstanding the foregoing, should the employee
either (i) be terminated pursuant to Paragraph 14(a)(iv) above following a
Change of Control as defined herein, or (ii) terminate his employment following
a Change of Control for “good reason” as defined below, the employee shall be
entitled to receive his Base Salary, to receive any bonus earned through the
termination date, and to continue to participate in employee benefit plans for
twenty-four (24) months following such termination. For purposes of this
Paragraph 14(e), “good reason” shall mean (A) any material failure by the
Company to comply with any material obligation imposed by this Agreement; or
(B) a substantial reduction in Employee’s title, position, duties or
responsibilities; provided, however, that any termination of employment by
Employee for “good reason” shall be made upon not less than thirty (30) days’
prior written notice to the Company specifying in reasonable detail the reason
therefore and provided further that if the reason for resignation for “good
reason” is susceptible of cure, the

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	 	 	 	Company shall have a period of thirty (30) days after such written notice to
effect a cure.

5. Paragraph 14(f) of the Employment Agreement is hereby deleted in its entirety and replaced with
the following:

	 	(f)	 	If, and only if, the Employee properly terminates his employment by
retirement with notice pursuant to Paragraph 14(a)(v) above, and has not
otherwise violated this Agreement, then the Company shall further pay to
Employee an amount equivalent to two (2) weeks of the last annual base salary
of Employee times the number of full years that Employee has been employed by
the Company.

6. Paragraph 16 (Definitions) of the Employment Agreement is hereby amended by adding at
the end thereof the following definition for “Qualifying Service”:

     “Qualifying Service” shall mean that, as of the applicable date, (i) Employee
is actively serving as the Chief Executive Officer of the Company, or (ii) Employee
is actively transitioning to a successor Chief Executive Officer, as determined by
the Compensation Committee of the Board of Directors in good faith, or (iii) a
Change of Control has been consummated on or before such date.

7. Paragraphs 16 (Notices), 17 (Binding Effect; Assignment), 18 (Entire
Agreement), 19 (Amendment), 20 (Severability), 21 (Waiver), 22
(Counterparts), 23 (Headings), 24 (Litigation Expenses), and 25
(Governing Law) of the Employment Agreement are hereby renumbered as Paragraphs 17
(Notices), 18 (Binding Effect; Assignment), 19 (Entire Agreement), 20
(Amendment), 21 (Severability), 22 (Waiver), 23 (Counterparts), 24
(Headings), 25 (Litigation Expenses), and 26 (Governing Law), respectively.

8. The “If to Company” portion of Paragraph 17 (Notices) of the Employment Agreement is
hereby amended as follows:

	 	 	 	 	 
	 

	 	If to Company:
	 	Mr. David R. Lipinski
	 

	 	 	 	c/o Optelecom-NKF, Inc
	 

	 	 	 	Chairman, Compensation Committee.
	 

	 	 	 	12920 Cloverleaf Center Drive
	 

	 	 	 	Germantown, Maryland 20874
	 

	 	 	 	Telephone: 301-444-2200

9. Each reference in the Employment Agreement to “the Employer” is hereby amended to provide “the
Company”.

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10. Except as specifically modified by this Amendment, all other terms and conditions of the
Employment Agreement shall continue in full force and effect.

11. This Amendment may be executed in two or more counterparts, all of which together shall
constitute one and the same instrument.

[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Second Amendment
to Employment Agreement as of the date set forth above.

	 	 	 	 	 
	 	OPTELECOM-NKF, INC.

 	 
	 	By:  	 	 
	 	 	David Lipinski, Chairman 	 
	 	 	Compensation Committee 	 
	 
	 	EMPLOYEE

 	 
	 	 	 
	 	         Edmund Ludwig 	 
	 	 	 	 
	 

5exv10w2

 

Exhibit 10.2

Amendment to Employment Contract

This amendment (this “Amendment”) is entered into as of December 18, 2006 between Optelecom-NKF
B.V. (formerly NKF Electronics B.V.), a private limited company incorporated in the Netherlands
(the “Company”), and Thomas Wilhelmus Martinus Overwijn (“Executive”).

The parties hereby agree as follows:

	 	1.	 	Prior Employment Contract. The parties have previously entered into an employment
contract effective April 1, 2005 (the “Agreement”). The parties now wish to amend the
Agreement as stated herein.
	 
	 	2.	 	Amendment: The parties hereby amend Paragraph 2 of Clause 3, Working hours and salary,
of the Agreement to increase Executive’s annual gross salary from EUR 105,000 to EUR
115,000, effective as of January 1, 2007.
	 
	 	3.	 	Continuing Effect of Agreement: The parties hereto agree that the terms and provisions
of the Agreement, as amended by this Amendment, shall remain in full force and effect.
Except as specifically modified by this Amendment, the terms and provisions of the
Employment Agreement shall continue and be binding on the parties hereto. In the event of
any conflict between the provisions of the Employment Agreement and the provisions of this
Amendment, the provisions of this Amendment shall control. The provisions of the
Employment Agreement and this Amendment constitute the entire agreement between the parties
concerning the Executive’s employment arrangement with the Company, and may not be amended
or modified except by a written agreement between the parties.

To evidence their agreement to the terms of this Amendment, Executive has signed and Company has
caused its duly authorized representative to sign this Amendment as of December 18, 2006.

	 	 	 	 	 
	Optelecom-NKF B.V.:	 	Executive:
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 
	 	 
	 

	 	Edmund Ludwig
	 	Thomas W. M. Overwijn

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