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  Exhibit 10.7    
    

December 22, 2008  

 Allied Motion Technologies Inc.
  23 Inverness Way East, Suite 150

Englewood, Colorado 80112 

Richard
S. Warzala 

Dear
Mr. Warzala: 

        Allied
Motion Technologies Inc. f/k/a Hathaway Corporation (the "Company") entered into an agreement with you dated May 1, 2002 (the "Agreement"), under which the Company
agreed to provide you with certain severance benefits in the event your employment with the Company is Terminated
following a change in control of the Company. In order to comply with the requirements of Section 409A of the Internal Revenue Code, as amended (the "Code"), as well as to incorporate certain
changes to the Agreement approved by the board of directors of the Company (the "Board"), the Company and you hereby agree to amend and restate the Agreement as follows: 

        The
Company has determined that it is essential to the best interests of the Company and its shareholders to foster the continuous employment of key management personnel including you as
COO of the Company. The Board recognizes that, as is the case with many publicly held corporations, the possibility of a change in control of the Company exists. Such possibility and the uncertainty
and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its shareholders. In addition, the Company
seeks your unequivocal support in realizing the maximum value per share to shareholders in the event of a disposition of the Company. In the event of a change of control, we also seek your cooperation
in a smooth transition of management. These objectives require employment arrangements that provide security to you in the face of uncertainty. 

        The
Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of management, including yourself, to their
assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a change in control of the Company. 

        In
order to induce you to remain in the employ of the Company, and in consideration of your agreements set forth in Section 2(ii), the Company agrees that you shall receive the
severance benefits set forth in this Agreement in the event your employment with the Company is Terminated subsequent to a change in control of the Company (as defined in Section 2 hereof)
under the circumstances described below. 

        1.     Term of Agreement.    As originally drafted, this Agreement commenced on May 1, 2002, and continued in
effect through December 31, 2002. Commencing on January 1, 2003 and each January 1 thereafter, the term of this Agreement automatically extended for one additional year (meaning
that as of each January 1 this Agreement shall then have a term of two years which shall reduce during the ensuing 12 months but shall again be extended on the next following
January 1 to a term of two years) and shall continue to do so unless, not later than the September 30 immediately preceding each such January 1, the Company shall have given
notice that it does not wish to extend this Agreement; provided further, if a change in control of the Company shall have occurred during the original or extended term of this Agreement, this
Agreement shall continue in effect for a period of 24 months beyond the month in which such event occurred. 

        2.     (i)
Change in Control of the Company.    No benefits shall be payable hereunder unless there shall have been a
change in control of the Company, as set forth below. For purposes of this Agreement, a "change in control of the Company" shall be deemed to have occurred (A) if any "Person" (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as 

 

amended
(the "Exchange Act"), other than (1) a trustee or other fiduciary holding securities under an employee benefit plan of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan, or (2) any Person who, on the date hereof, is a director or officer of the Company or whose shares of common stock of
the Company are treated as beneficially owned (as defined in Rule 13d-3 under the Exchange Act) by any such director or officer, is or becomes the beneficial owner, directly or
indirectly, of securities of the Company representing more than 45% of the combined voting power of the Company's then outstanding securities; or (B) upon the first purchase of outstanding
shares of the Company's outstanding common stock pursuant to a tender or exchange offer (other than a tender or exchange offer made by the Company, by an employee benefit plan established or
maintained by the Company or by any of their respective affiliates); or (C) if during any period of two consecutive years, individuals who, at the beginning of such period, constitute the Board
and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clauses (A) or (D) of this
Subsection) whose election by the Board or nomination for election by the Company's shareholders was approved by a vote of at least two-thirds (2/3) of the Company directors
then still in office who either (1) were directors at the beginning of the period or (2) whose election or nomination for election was previously so approved, cease for any reason to
constitute a majority thereof; or (D) if the shareholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 80% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or
(E) the shareholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company's
assets; 

        provided, however, a spinoff distribution to shareholders of the Company of all or part of the Company's equity interest in a subsidiary
entity shall not constitute a change in control of the Company. 

        (ii)   Potential Change in Control of the Company.    For purposes of this Agreement, a "potential change in control
of the Company" shall be deemed to have occurred if (A) the Company enters into an agreement, the consummation of which would result in the occurrence of a change in control of the Company;
(B) any Person (including the Company) publicly announces an intention to take or to consider taking actions which if consummated would constitute a change in control of the Company;
(C) any Person, other than (1) a trustee or other fiduciary holding securities under an employee benefit plan of the Company, or (2) any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan, or (3) any Person who, on the date hereof, is a director or officer of the Company or whose shares of common stock of
the Company are treated as beneficially owned by any such director or officer, increases his beneficial ownership of such securities by 8% or more of the shares of the Company issued and outstanding
on the date of such determination; or (D) the Board adopts a resolution to the effect that, for purposes of this Agreement, a potential change in control of the Company has occurred. You agree
that, subject to the terms and conditions of this Agreement, in the event of a potential change in control of the Company, you will remain in the employ of the Company until the earliest of
(1) a date which is twelve (12) months after the occurrence of such potential change in control of the Company, (2) the Termination by you of your employment by reason of death or
Disability or Retirement, as defined in Section 3(i), or (3) the occurrence of a change in control of the Company. 

        3.     Termination Following Change in Control.    If any of the events described in Section 2(i) hereof
constituting a change in control of the Company shall have occurred, you shall be entitled to the benefits provided in Section 4(iii) hereof upon the subsequent Termination of your employment
during 

2

 

the
term of this Agreement unless such Termination is (A) because of your death, Disability or Retirement, (B) by the Company for Cause, or (C) by you other than for Good Reason. 

        (i)    Disability; Retirement.    If, as a result of your incapacity due to physical or mental illness, you shall have
been absent from the full-time performance of your duties with the Company for six (6) consecutive months, and within thirty (30) days after Notice of Termination is given
you shall not have returned to the full-time performance of your duties, your employment may be Terminated for "Disability". Termination of your employment based on "Retirement" shall mean
your Termination of employment in accordance with any retirement arrangement established with your consent. 

        (ii)   Cause.    Termination by the Company of your employment for "Cause" shall mean Termination upon (A) an
act of dishonesty constituting a felony under the laws of your domicile and resulting or intending to result in your gain or personal enrichment at the expense of the Company, or (B) use of
drugs or excessive and habitual use of alcohol either of which substantially affects your ability to perform your duties with the Company, or (C) continued unauthorized and significant absences
from duty (other than any such absences resulting from your incapacity due to physical or mental illness or any such actual or anticipated absences after the issuance of a Notice of Termination by you
for Good Reason as defined in Sections 3(iv) and 3(iii), respectively) after a written notice is delivered to you by the Company, which notice specifically identifies the cause referred to
above which is identified as the basis for
Termination. Notwithstanding the foregoing, you shall not be deemed to have been Terminated for Cause unless and until there shall have been delivered to you a copy of a resolution duly adopted by the
Board with the approval of not less than three-fourths (3/4) of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice to
you and an opportunity for you, together with your counsel, to be heard before the Board), finding that in the good faith opinion of the Board you were guilty of conduct set forth above and specifying
the particulars thereof in detail. 

        (iii)  Good Reason.    You shall be entitled to Terminate your employment for Good Reason within two years following
the initial existence of one or more of the circumstances described below. For purposes of this Agreement, "Good Reason" shall mean, without your express written consent, the occurrence after a change
in control of the Company of any of the following circumstances, after you have given the Company notice within ninety (90) days following the initial existence of the circumstances, and the
Company has failed to remedy such circumstances within thirty (30) days of receiving such notice: 

        (A)  any
change in your title or corporation office, to the extent such change results in a material diminution of your authority, duties or responsibilities; the assignment
to you of any duties inconsistent with your status as CEO of the Company; or a substantial adverse alteration in the nature or status of your responsibilities (including reporting responsibilities)
from those in effect immediately prior to the change in control of the Company; 

        (B)  the
change of the principal business of the Company (for purposes of this Agreement, as it is composed immediately prior to the change in control of the Company) as
evidenced by, but not limited to, any sale of assets of the Company producing more than 50% of the Company's revenue, or comprising more than 50% of the Company's total assets, in any of the three
most recent fiscal years prior to such sale, to the extent such change results in a material negative change to your duties, the conditions under which such duties are to be performed, or to your
compensation; 

        (C)  a
reduction, without your consent, in your annual base salary as in effect on the date hereof or as the same may be increased from time to time; 

3

 

        (D)  the
relocation of your principal office to a location more than 50 miles from the location where such office is located immediately prior to the change in control of the
Company except for required travel on Company business to an extent substantially consistent with your present business travel obligations; 

        (E)  the
failure, without your consent, to pay to you any portion of your current compensation or to pay to you any portion of an installment of deferred compensation under
any deferred compensation program applicable to you, within seven (7) days of the date such compensation is due, to the extent such failure constitutes a material breach of this agreement or
results in a material negative change to your compensation; 

        (F)  the
failure by the Company to continue in effect, except upon expiration in accordance with their terms, any compensation plan in which you participate immediately prior
to the change in control of the Company which is material to your total compensation, including but not limited to the Company's Management Incentive Bonus Plan, Tax-Advantaged Investment
Plan, Employee Stock Ownership Plan and Trust, and 1991 Incentive and Nonstatutory Stock Option Plan, or any plans adopted in substitution of existing plans prior to the change in control of the
Company, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of your participation relative to other
participants, as existed at the time of the change in control of the Company, to the extent such failure constitutes a material breach of this agreement or results in a material negative change to
your compensation; 

        (G)  the
failure by the Company to continue to provide you with benefits substantially similar to those enjoyed by you under any of the Company's life insurance, medical,
health and accident, or disability plans in which you were participating at the time of the change in control of the Company, the taking of any action by the Company which would directly or indirectly
materially reduce any of such benefits or deprive you of any material fringe benefit enjoyed by you at the time of the change in control of the Company, or the failure by the Company to provide you
with the number of paid vacation days to which you are entitled on the basis of years of service with the Company in accordance with the Company's normal vacation policy in effect at the time of the
change in control of the Company, to the extent such failure constitutes a material breach of this agreement or results in a material negative change to your compensation; 

        (H)  the
events described as a breach in Section 7 (i) or (ii) hereof; 

or

        (I)   any
purported Termination of your employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Subsection (iv) below (and,
if applicable, the requirements of Subsection (ii) above); for purposes of this Agreement, no such purported Termination shall be effective. 

Your
right to Terminate your employment pursuant to this Subsection (iii) shall not be affected by your incapacity due to physical or mental illness. Your continued employment shall not
constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason hereunder. 

        (iv)  Notice of Termination.    Any purported Termination of your employment by the Company or by you shall be
communicated by written Notice of Termination to the other party hereto in accordance with Section 8 hereof. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific Termination provision in this Agreement relied 

4

 

upon
and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for Termination of your employment under the provision so indicated. 

        (v)   Date of Termination, Etc.    "Date of Termination" shall mean (A) if your employment is terminated for
Disability, thirty (30) days after Notice of Termination is given (provided that you shall not have returned to the full-time performance of your duties during such thirty
(30) day period), and (B) if your employment is terminated pursuant to Subsection (ii) or (iii) above or for any other reason (other than Disability), the date specified in
the Notice of Termination (which, in the case of a termination pursuant to Subsection (ii) above shall be not less than thirty (30) days, and in the case of a termination pursuant to
Subsection (Hi) above shall be not less than fifteen (15) nor more than sixty (60) days, respectively, your separation from the date such Notice of Termination is given); provided,
however, that in each case the Date of Termination constitutes a separation from service as defined in Code Section 409A. If a dispute arises regarding your Termination of employment, you shall
continue to perform your duties for the Company and the Company will continue to pay you your full compensation in effect when the notice giving rise to the dispute was given (including, but not
limited to, base salary) and continue you as a participant in all compensation, benefit and insurance plans in which you were participating when the notice giving rise to the dispute was given, until
the dispute is finally resolved. Amounts paid under this Subsection are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under
this Agreement. 

        4.     Compensation Upon Termination or During Disability.    Following a change in control of the Company, as defined
by Section 2(i), upon Termination of your employment or during a period of Disability you shall be entitled to the following benefits: 

        (i)    During
any period that you fail to perform your full-time duties with the Company as a result of incapacity due to physical or mental illness, but during
which you continue to be employed by the Company, you shall continue to receive your base salary at the rate in effect at the commencement of any such period, together with all compensation payable to
you under the Management Incentive Compensation Plan or other plan during such period, until this Agreement is terminated pursuant to Section 3(i) hereof. Thereafter, or in the event your
employment shall be Terminated by the Company or by you for Retirement, or by reason of your death, your benefits shall be determined pursuant to agreements between you and the Company and the
Company's insurance and other compensation programs then in effect in accordance with the terms of such programs. 

        (ii)   If
your employment shall be Terminated by the Company for Cause or by you other than for Good Reason, Disability, death or Retirement, the Company shall pay you your
full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts to which you are entitled under any compensation plan of the
Company at the time such payments are due, and the Company shall have no further obligations to you under this Agreement. 

        (iii)  If
your employment by the Company shall be Terminated (a) by the Company other than for Cause, Retirement or Disability or (b) by you for Good Reason,
then you shall be entitled to the benefits provided below: 

        (A)  the
Company shall pay you your full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given, plus all other amounts
to which you are entitled under any compensation plan of the Company, at the time such payments are due, except as otherwise provided below; 

        (B)  in
lieu of any further salary payments to you for periods subsequent to the Date of Termination, the Company shall pay you a lump sum severance payment equal to 2.5 

5

 

times
the sum of (x) your annual base salary in effect immediately prior to the occurrence of the circumstance giving rise to the Notice of Termination given in respect thereof and
(y) the highest amount paid or payable to you pursuant to the Management Incentive Compensation Plan for any of the three (3) fiscal years ending prior to the Notice of Termination;
provided however, that for purposes of computing the payment under this clause (B), your entitlement to incentive compensation shall be determined solely based on whether the parameters that
have been determined by the Board for the applicable year have been achieved, and without regard to any discretionary or other right of the Board under the terms of any such incentive compensation
plan to deny payment notwithstanding that such parameters have been achieved; 

        (C)  notwithstanding
any provision of any incentive compensation plan applicable to you, the Company shall pay to you a lump sum amount equal to the sum of (x) any
incentive compensation paid or payable to you, or that has been allocated or awarded to you, for a fiscal year or other measuring period preceding the Date of Termination but which has not yet been
paid, and (y) an allocation under any annual or long-term incentive plan applicable to you for the current fiscal year with all tests for income adjusted pro rata according to the
number of calendar months, including the month in which the Date of Termination occurs, that have elapsed in the fiscal year of Termination; provided however, that for purposes of computing the
payment under this clause (C), your entitlement to incentive compensation shall be determined solely based on whether the parameters that have been determined by the Board for the applicable
year have been achieved, and without regard to any
discretionary or other right of the Board under the terms of any such incentive compensation plan to deny payment notwithstanding that such parameters have been achieved; 

        (D)  the
Company shall also pay to you all legal fees and expenses incurred by you as a result of such Termination (including all such fees and expenses, if any, incurred in
contesting or disputing any such Termination or in seeking to obtain or enforce any right or benefit provided by this Agreement or in connection with any tax audit or proceeding to the extent
attributable to the application of Code Section 4999 to any payment or benefit provided hereunder). The right to reimbursement of legal fees and expenses that are not otherwise exempt from Code
Section 409A: (i) shall be available to you for as long as you have enforceable rights under this Agreement; (ii) shall be payable without regarding to any amounts that have been
reimbursed in prior tax years under this Agreement; (iii) shall be paid to you on or before the last day of the tax year following the year in which you incurred the expense; and
(iv) shall not be subject to liquidation or exchange for another benefit; 

        (E)  in
the event that you become entitled to payments (the "Severance Payments") provided under paragraphs (B), (C), and (D), above, and Subsection (iv),
below, if any of the Severance Payments will be subject to the tax (the "Excise Tax") imposed by Section 4999 of the Code, the Company shall pay to you at the time specified in
paragraph (F), below, an additional amount (the "Gross-Up Payment") such that the net amount retained by you, after deduction of any Excise Tax on the Severance Payments and any
federal and state and local income tax and Excise Tax upon the payment provided for by this paragraph, shall be equal to the Severance Payments. For purposes of determining whether any of the
Severance Payments will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by you in connection with a change in
control of the Company or your Termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result 

6

 

in
a change in control or any person affiliated with the Company or such person) shall be treated as "parachute payments" within the meaning of Section 280G(b)(2) of the Code, and all "excess
parachute payments" within the meaning of Section 280G (b)(1) shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by the Company's independent auditors
and acceptable to you, such other payments or benefits (in whole or in part) do not constitute parachute payments, or such excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the base amount within the meaning of Section 280G(b)(3) of the Code, or are
otherwise not subject to the Excise Tax, (ii) the amount of the Severance Payments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the total
amount of the Severance Payments or (B) the amount of excess parachute payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and (iii) the
value of any non-cash benefits or any deferred payment or benefit shall be determined by the Company's independent auditors in accordance with the principles of Sections 280G(d)(3)
and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, you shall be deemed to pay federal income taxes at the highest marginal rate of federal income
taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of your
residence on the Date of Termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the
event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder at the time of Termination of your employment, you shall repay to the Company at the time
that the amount of such reduction in Excise Tax is finally determined the portion of the Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up
Payment attributable to the Excise Tax and federal and state and local income tax imposed on the Gross-Up Payment being repaid by you if such repayment results in a reduction in Excise Tax
and/or a federal and state and local income tax deduction) plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise
Tax is determined to exceed the amount taken into account hereunder at the time of the Termination of your employment (including by reason of any payment the existence or amount of which cannot be
determined at the time of the Gross-Up Payment), the Company shall make an additional gross-up payment in respect of such excess (plus any interest payable with respect to such
excess) at the time that the amount of such excess if finally determined; 

        (F)  the
payments provided for in paragraphs (B), (C) and (E) above, shall be made not later than the fifth day following the Date of Termination,
provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the Company, shall pay to you on such day an estimate, as determined in good faith by the
Company, of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code) as soon as the
amount thereof can be determined but in no event later than the thirtieth day after the Date of Termination. In the event that the amount of the estimated payments exceeds the amount subsequently
determined to have been due, such excess shall constitute a loan by the Company to you payable on the fifth day after demand by the Company (together with interest at the rate provided in
Section 1274 (b) (2) (B) of the Code). In no event shall the Gross-Up Payment be made later than the end of the tax year following the year in which you paid the
Excise Tax. 

7

 

        (iv)  If
your employment shall be Terminated (A) by the Company other than for Cause, Retirement or Disability or (B) by you for Good Reason, then for a
24-month period immediately following such Termination of employment, the Company shall pay you on a monthly basis, pursuant to the Company's regular payroll timing, an amount equal to 25%
of your monthly Base Salary being paid on your Date of Termination, to assist you in purchasing whatever benefits you choose during such period. 

        (v)   You
shall not be required to mitigate the amount of any payment provided for in this Section 4 by seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Section 4 be reduced by any compensation earned by you as the result of employment by another employer, by retirement benefits, by offset against any
amount claimed to be owed by you to the Company, or otherwise. 

        5.     Termination Before Change in Control.    If your employment by the Company shall be terminated by the Company
other than for Cause, Retirement or Disability, and a change in control of the Company occurs within 90 days thereafter, you shall be entitled to the benefits provided in Section 4(iii)
hereof. 

        6.     Definition of Termination of Employment.    With respect to any payment triggered upon your "termination" of
employment, such payment may not be made unless and until such termination constitutes your separation from service with the Company, as defined under Code Section 409A. Furthermore, if you are
a "specified employee" within the meaning of Code Section 409A, as determined by the Company, the payment of any amount that is subject to Code Section 409A and that is due under this
Agreement upon your Termination of employment shall not be made until at least six months following your separation from service. At that time, all amounts, if any, that would have been paid during
the six-month period shall be paid to you, and thereafter all payments shall be made as if there had been no six-month delay. 

        7.     Successors; Binding Agreement; Release of the Company.

        (i)    In
the event there is a disposition of the Company in a transaction as described in Section 2(i)(A), (B) (C) or (D), and the Company under new ownership or
any successor to the Company in such transactions, and any business entity beneficially owning directly or indirectly 50% or more equity interest in the Company or any such successor, (A) does
not assume and agree to perform this Agreement in the same manner and to the same extent the Company would be required to perform it if no succession had taken place, or (B) alternatively, does
not offer to provide you an agreement with benefits substantially similar to this Agreement, resulting in your Termination of employment, then such failure to obtain the events described in
clauses (A) or (B) above of this Section 7(i), prior to the effectiveness of such succession shall be a breach of this Agreement and shall entitle you to compensation from the
Company in the same amount and on the same terms as you would be entitled to hereunder if you Terminated your employment for Good Reason following a change in control of the Company, except that for
purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination. However, if you enter into an employment agreement with the
Company or such successor as a part of the transaction or if the Company or any such successor, (l) does assume and agree to perform this Agreement in the same manner and to the same extent the
Company would be required to perform it if no succession had taken place, or (2) alternatively, does offer to provide you an agreement with benefits substantially similar to this Agreement,
then the obligation hereunder of the Company shall be released from all obligations under this Agreement. 

        (ii)   In
the event there is a disposition in a transaction described in Section 2(i)(E) and any transferee entity in such a transaction, and any business entity
beneficially owning directly or indirectly 50% or more equity interest in such transferee entity (A) does not assume and agree to 

8

 

perform
this Agreement in the same manner and to the same extent the Company would be required to perform it if no succession had taken place, or (B) alternatively, does not offer to provide
you an agreement with benefits substantially similar to this Agreement, resulting in your Termination of employment, then such failure to obtain the events described in clauses (A) or
(B) above of this Section 7(ii), prior to the effectiveness of such succession shall be a breach of this Agreement and shall entitle you to compensation from the Company in the same
amount and on the same terms as you would be entitled to hereunder if you Terminated your Employment for Good Reason following a change in control of the Company, except that for purposes of
implementing the foregoing the date on which any such succession becomes effective shall be deemed the Date of Termination. However, if you enter into an employment agreement with the transferee
entity as a part of the transaction or if such transferee entity (1) does assume and agree to perform this Agreement in the same manner and to the same extent the Company would be required to
perform it if no succession had taken place, or (2) alternatively, does offer to provide you an agreement with benefits substantially similar to this Agreement, then the obligation hereunder of
the Company shall be released from all obligations under this Agreement. 

        (iii)  This
Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount would still be payable to you hereunder if you had continued to live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate. 

        (iv)  Your
obligations hereunder shall inure to the benefit of and be enforceable by the Company and each of its successors and assigns by contract, operation of law or
otherwise. 

        8.     Notice.    For the purpose of this Agreement, notices and all other communications provided for in the Agreement
shall be in writing and shall be deemed to have been duly given when delivered by overnight courier, transmitted electronically over the internet as long as confirmation of receipt is obtained from
the recipient or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement,
provided that all notices to the Company shall be directed to the attention of the Chairman of the Board of Directors with a copy to the Secretary of the Company to Allied Motion
Technologies, Inc., 23 Inverness Way East, Suite 150, Englewood, Colorado 80112, or to such other address as any such person may have furnished to the others in writing in accordance
herewith, except that notice of change of address shall be effective only upon receipt. 

        9.     Miscellaneous.    No provision of this Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by you and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the
other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which
are not expressly set forth in this Agreement. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the state of incorporation of the Company.
All references to sections of the Exchange Act or the Code shall be deemed also to refer to any successor provisions to such sections. Any payments provided for hereunder shall be paid net of any
applicable withholding required under federal, state or local law. The obligations of the Company under Section 4 shall survive the expiration of the term of this Agreement. 

        10.   Counterparts.    This Agreement may be executed in several counterparts, each of which shall be deemed to be an
original but all of which together will constitute one and the same instrument. 

9

 

        11.   Arbitration.    Any dispute or controversy arising under or in connection with this Agreement shall be settled
exclusively by arbitration in the city where you reside or in an alternate location approved by you in accordance with the rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrators award in any court having jurisdiction; provided, however, that you shall be entitled to seek specific performance of your right to be paid until the Date of Termination
during the pendency of any dispute or controversy arising under or in connection with this Agreement. 

        12.   Severability.    In the event that any provision or portion of this Agreement shall be determined to be invalid
or unenforceable for any reason, the remaining provisions and portions of this Agreement shall be unaffected thereby and shall remain in full force and effect to the fullest extent provided by law. 

        If
this letter sets forth our agreement on the subject matter hereof, kindly sign and return to the Company the enclosed copy of this letter which will then constitute our agreement on
this subject. 

					
	

 	
 	
Sincerely,
	

 	
 	
ALLIED MOTION TECHNOLOGIES INC.
	

 	
 	
By:	
 	
/s/ RICHARD D. SMITH

 
	 	 	Name:	 	Richard D. Smith
	 	 	Title:	 	 CEO
	
 APPROVED: December 22, 2008.	
 	

 	
 	

 
	
 /s/ RICHARD S. WARZALA

  Richard S. Warzala	
 	

 	
 	

 

10

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 Exhibit 10.8  

 
 

  ALLIED MOTION TECHNOLOGIES INC.
  DEFERRED COMPENSATION PLAN
  As Amended and Restated Effective January 1, 2007    
    

        Allied Motion Technologies Inc., a Colorado corporation (the "Company") previously established the Allied Motion
Technologies Inc. Deferred Compensation Plan (the "Plan"), effective as of January 1, 2006. 

        Effective
as of January 1, 2007, the Company hereby amends and restates the Plan in its entirety. The provisions of the amended and restated Plan shall apply to all Plan
Participants on and after January 1, 2007. 

        The
purposes of the Plan are (1) to provide certain key employees with the opportunity to defer the receipt of certain compensation otherwise payable to them, and (2) to
permit eligible key employees to participate in the success of the Company by providing them with the opportunity to earn additional, performance based compensation. 

        1.    Definitions.    

        The
following definitions shall apply for the purposes of the Plan: 

        1.01 "Account"
means the bookkeeping account established for each Participant under this Plan for the purpose of recording amounts credited on behalf of such Participant and
any income, gains or losses thereon, as further described in Section 7. 

        1.02 "Appropriate
Form" means a written or electronic election or other form prescribed by the Board for use in connection with this Plan. The Board may modify, update or
replace any Appropriate Form, on a prospective basis, at any time, and the new or modified form shall take effect with respect to each Participant as soon as it is furnished to such Participant. 

        1.03 "Beneficiary"
means a person or trust designated in an Appropriate Form as being entitled to receive payment under this Plan on account of the death of a Participant.
If no valid designation of a beneficiary is made, a Participant's Beneficiary shall be such Participant's estate. 

        1.04 "Board"
or "Board of Directors" means the Board of Directors of the Company or, where applicable, any Committee of the Board to which authority with respect to any
matter relating to this Plan is delegated. 

        1.05 "Bonus"
means any bonus payable to a Participant by the Employer under the Employee Incentive Bonus Plan, or any other bonus plan for the benefit of one or more
Participants that is approved by the Board. 

        1.06 A
"Change of Control", for purposes of the Plan, shall be defined in the manner set forth in Section 409A of the Code and the Treasury Regulations thereunder. 

        1.07 "Code"
means the Internal Revenue Code of 1986, as amended. 

        1.08 "Deferral"
means a portion of a Participant's Salary or Bonus which is deferred pursuant to Section 3.02 and credited to the Participant's Account in accordance
with Section 3.03. 

        1.09 "Deferral
Election" means each Participant's written election to defer the receipt of Salary or Bonus in accordance with Section 3.02. 

        1.10 "Disabled"
means suffering from any mental or physical condition, other than use of alcohol or illegal use of drugs or narcotics, which renders a Participant unable to
perform substantially all of the duties and services for the Company required of the Participant in a satisfactory manner for 120 consecutive days, or 180 days during any 12-month
period. 

 

        1.11 "Discretionary
Contribution" means an unfunded contribution for the benefit of a Participant, as described in Section 6. 

        1.12 "Effective
Date of the Plan" means January 1, 2006. 

        1.13 "Employer"
means the Company or, where applicable, a subsidiary of the Company which is the employer of a Participant. 

        1.14 "Investment
Funds" means those mutual funds that are designated by the Board from time to time as the investments available to measure adjustments to Accounts, as
provided in Section 7.03. 

        1.15 "Net
Profit" means the after tax net income of the Company for a Year, as stated in the Company's certified financial statements. 

        1.16 "Net
Profit Target" means a threshold amount of Net Profit for a Year, designated by the Board as a Performance Criterion pursuant to Section 4.01. 

        1.17 "Participant"
means an executive employee of the Company or a subsidiary of the Company who is designated by the Board as a participant in the Plan. Effective on and
after January 1, 2007, for purposes of Section 3, Section 4 and Section 5 hereof, a "Participant" means a Participant who has been designated by the Board as eligible to
make the contributions or receive the benefits described in such Section. 

        1.18 "Performance
Contribution" means an unfunded contribution for the benefit of a Participant, as described in Section 4. 

        1.19 "Performance
Criteria" means such Net Profit Targets or other organizational criteria, the satisfaction of which is a condition to the Participants' earning Performance
Contributions. 

        1.20 "Plan"
means the Plan set forth herein, as it may be amended from time to time in accordance with Section 11.01. 

        1.21 "Retirement"
or "Retire" means any termination of employment with the Company on or after the Effective Date of the Plan. 

        1.22 "Salary"
means the base salary payable to each Participant by the Company. 

        1.23 "Separation
from Service" means, with respect to a Participant, such Participant's death, retirement or other termination of employment with the Company. For purposes
of the Plan, such term will be interpreted and applied in a manner consistent with Section 409A of the Code and the Treasury regulations thereunder. 

        1.24 "Term"
means the period of time during which the Plan is in effect, beginning on the Effective Date of the Plan and ending on the effective date of the Plan's
termination pursuant to Section 11.01 or 11.02. 

        1.25 "Year"
means each calendar year during the Term of this Plan. 

        2.    Participation.    

        2.01    Commencement.    Participation in the Plan is limited to those Executive employees of the Company or a
subsidiary of the Company that are (a) members of a select group of management and highly compensated Employees, as determined by the Board, and (b) designated by the Board. An employee
of the Company or a subsidiary of the Company will become a Participant in the Plan upon being so designated by the Board, effective as of such date as the Board shall designate (which may be prior to
the date of such designation). 

        2.02    Scope of Participation.    In designating an employee of the Company or a subsidiary of the Company as a
Participant, the Board shall designate the contributions or benefits under the Plan that 

2

 

the
Participant will be eligible to make or receive. If the Board makes no special designation with respect to an employee who first becomes a Participant on or after January 1, 2007, such
Participant will be eligible only to make deferrals in accordance with Section 3 and shall not be eligible to receive Performance Contributions pursuant to Section 4 or benefits upon a
change of control pursuant to Section 5. Effective on and after January 1, 2007, as used in Section 3, Section 4 and Section 5 hereof, a "Participant" means a
Participant who has been designated by the Board as eligible to make the contributions or receive the benefits described in such Section. 

        2.03    Termination of Participation.    Once designated as a Participant, an individual will continue as a
Participant until the earliest of the following: 

        (a)   all
benefits to which he is entitled under the Plan have been distributed to him; 

        (b)   the
Participant ceases to meet the eligibility requirements stated in Section 2.01; or 

        (c)   the
Plan is terminated pursuant to Section 11.01. 

        3.    Deferrals.    

        3.01    Deferral of Salary or Bonus.    

        (a)   Each
Participant may elect to defer receipt of up to 100 percent of the Salary and any Bonus otherwise payable to such Participant for a given Year. 

        (b)   A
Participant may defer an item of compensation only to the extent that the Participant is entitled to receive such item of compensation. Upon electing such a Deferral,
the Participant will have no further right to such deferred compensation other than as provided under the Plan. 

        3.02    Deferral Election.    

        (a)   To
elect to defer Salary or a Bonus, each eligible Participant shall file a Deferral Election, on the Appropriate Form, with the Secretary of the Company in
accordance with this Section 3.02. 

        (b)   Except
as provided in subsection (e), an election to defer Salary for a Year shall be filed by December 31 of the Year preceding the Year in which the
election is to take effect. The election shall be effective with respect to Salary payable for all payroll periods ending in the Year in which it is effective. An election must (i) specify a
Deferral which is a stated percentage of the Participant's Salary for such Year, and (ii) designate the form and time of distribution of that potion of the Participant's Deferral
Sub-Account (as defined in Section 3.03) attributable to such Deferral Election, as further provided in Section 8.01. 

        (c)   Except
as provided in subsection (e), an election to defer a Bonus shall be filed before the beginning of the Year during which the performance on which the Bonus
will be based is measured; provided, however, that if such Bonus constitutes "performance based compensation", within the meaning of Section 409A(4)(B)(iii) of the Code and the Treasury
Regulations thereunder, and the other applicable requirements of such Regulations are met with respect to such Bonus, such election to defer may be made up until six months before the end of the Year
during which the applicable Performance criteria are measured. Whether a Bonus constitutes "performance based compensation" (as so defined) will be determined by the Board in its sole discretion. An
election to defer a Bonus must (i) specify a Deferral which is a stated percentage of such Bonus, and (ii) designate the form and time of distribution of that potion of the Participant's
Deferral Sub-Account (as defined in Section 3.03) attributable to such Deferral Election, as further provided in Section 8.01. 

        (d)   A
Deferral Election that is made prior to the due date for its filing, as herein provided, may be rescinded, and a new election made, before such due date. If not
rescinded, an election to defer shall become irrevocable at the expiration of the time for its filing. 

3

 

        (e)   For
the Year in which an employee first becomes a Participant, such Participant may file a Deferral Election with respect to Salary or Bonus paid for services
performed after the date such Deferral Election is filed, at any time thirty (30) days after such employee first becomes a Participant. 

        3.03    Credit to Account.    The Company shall credit any Deferral to a "Deferral Sub-Account" of each
Participant's Account, as described in Section 7.01, as of the date it would have otherwise been paid to each Participant. 

        3.04    Vesting.    A Participant's interest in his Deferral Sub-Account shall be fully vested at all
times. 

        3.05    Unforeseen Emergency.    Upon payment to a Participant pursuant to Section 8.05 on account of an
unforeseeable emergency, any Deferral Election such Participant has in effect for the Year of the payment shall automatically terminate. 

        4.    Performance Contributions.    

        4.01    Basis of Performance Contributions; Performance Criteria.    

        (a)   For
each Year during the Performance Contribution Term, the Company will credit Performance Contributions to the Accounts of all eligible Participants for a Year if the
Company achieves the Performance Criteria for such Year, and the other terms of conditions of this Plan are satisfied. 

        (b)   For
the first Year of the Plan, the Performance Criteria shall be: 

        (i)    A
Net Profit Target, which shall be a threshold amount of Net Profit, equal to a stated return on investment ("ROI"), determined in the manner stated in
Schedule 1 hereto; and 

        (ii)   A
stated percentage of the excess of (A) the Company's Net Profit for the Year, over (B) the Net Profit Target for such Year, determined in the manner
stated in Schedule 1. 

        (c)   For
each succeeding Year during the Term, the Board shall designate the applicable Performance Criteria for the Year on or before the ninetieth (90th) day
of such Year, or as soon thereafter as is practicable. 

        (d)   The
"Performance Contribution Term" with respect to any Participant means the period beginning on the Effective Date and ending on the earliest of: 

        (i)    December 31,
2020; or 

        (ii)   December 31st of
the third calendar year which begins after the date of such Participant's Separation from Service; or 

        (iii)  the
date on which such Participant is terminated for "Cause", within the meaning of such Participant's Employment Agreement with the Company or a subsidiary of the
Company, or 

        (iv)  the
date on which the Participant directly or indirectly: (A) (whether as director, officer, consultant, principal, employee, agent or otherwise) engages in or
contributes Participant's knowledge and abilities to any business or entity in competition with the Company or a subsidiary of the Company; or (B) attempts in any manner to solicit from any
customer of the Company or a subsidiary business of the type performed by the Company or a subsidiary or persuade any customer of the Company or a subsidiary to cease doing business or reduce the
amount of business that such customer has customarily done with the Company or a subsidiary. 

4

 

        4.02    Credit to Account.    The Company shall credit any Performance Contributions to a "Performance Contribution
Sub-Account" of each eligible Participant's Account, as described in Section 7.01, as of the date on which the amount of such Performance Contribution is determined by the Board. 

        4.03    Vesting.    

        (a)   A
Participant's interest in a Performance Contribution made on his behalf for a Year shall become fully vested if he: 

        (i)    is
employed by the Company or a subsidiary of the Company on December 31 of such Year, or 

        (ii)   Retires,
dies or becomes Disabled during such Year. 

        (b)   If
an eligible Participant Retires, dies or become Disabled during the Year, the Performance Contribution shall nevertheless be computed with respect to the entire Year,
and the Participant shall be entitled to receive the entire Performance Contribution for such Year. 

        5.    Benefits Upon a Change of Control.    

        5.01    Calculation of Change of Control Benefit.    

        (a)   In
the event of a Change of Control with respect to the Company which occurs during the Performance Contribution Term, a special benefit will be paid, at the time
hereafter provided, to all eligible Participants. Such benefit will be equal to the sum of the following: 

        (i)    An
amount equal to a pro rata portion of the Performance Contribution that would have been paid to such Participant for
the Year in which the Change of Control occurs, based on the number of days in such Year which precede the Change of Control; plus 

        (ii)   An
amount determined by multiplying 

        (A)  the
average of the Performance Contributions for the benefit of such Participant for the preceding three (3) years, or the number of years since the Effective
Date of the Plan, if less, by 

        (B)  the
lesser of (I) three (3), or (II) the number of Years, or fractions thereof, remaining after the date of the Change of Control until December 31,
2020. 

        (b)   For
purposes of computing the portion of special benefit described in clause (i), above: 

        (i)    Performance
Criteria shall be measured for the period ending on the last day of the month preceding the month that includes the effective date of the Change of Control;
and 

        (ii)   Extraordinary
costs arising out of the transactions that constitute the Change of Control shall be disregarded. 

        5.02    Payment of Change of Control Benefit.    The Change of Control benefit shall be determined by the Board prior
to the effective date of the Change of Control, and paid to each Participant in a lump sum during the 30 day period beginning on the date of the Change of Control. 

        6.    Discretionary Contributions.    

        6.01    Designation of Eligible Participants and Other Matters.    

        (a)   The
Board may, from time to time, allocate additional Discretionary Contributions to one or more Participants, in such amount(s) as the Board shall designate. 

        (b)   No
later than the date on which the Board designates the Participant(s) who shall receive such Discretionary Contributions, and the amount thereof, it shall also
designate when and how 

5

 

such
amounts shall be distributed to the eligible Participants, from among the options stated in Section 8.02. 

        6.02    Credit to Account.    The Company shall credit any Discretionary Contributions to a "Discretionary
Contribution Sub-Account" in each Participant's Account as of the date on which the Board makes the designations described in Section 6.01. 

        6.03    Vesting.    A Participant's interest in his Discretionary Sub-Account shall be fully vested at all
times. 

        7.    Participants' Accounts.    

        7.01    Establishment of Accounts and Sub-Accounts.    

        (a)   The
Company shall establish an Account for each Participant on the Company's books to which deferrals and contributions under this Plan shall be credited. 

        (b)   Deferrals
pursuant to Section 3, and any adjustments thereto pursuant to Section 7.03, shall be credited to a Deferral Sub-Account within the
Account of the Participant who makes such Deferral. Performance Contributions on behalf of a Participant pursuant to Section 4, and any adjustments thereto pursuant to Section 7.03,
shall be credited to a Performance Contribution Sub-Account within the Account of such Participant. Discretionary Contributions on behalf of a Participant pursuant to Section 6 and
any adjustments thereto pursuant to Section 7.03, shall be credited to a Discretionary Contribution Sub-Account within the Account of such Participant. 

        7.02    Performance Contributions Subject to Forfeiture.    Until and except to the extent that Performance
Contributions become vested in accordance with Section 4.03, the interest of each Participant in his Performance Contribution Sub-Account is contingent only and is subject to
forfeiture as provided in Section 4.03. 

        7.03    Imputed Investment Experience.    

        (a)   Each
Participant may designate one or more Investment Funds in which stated portions of such Participant's Account shall hypothetically be invested, by completing the
Appropriate Form and following such procedures as the Board shall designate. Each Participant may allocate his Account or any Sub-Account among different Investment Funds in increments of
10%. Furthermore, each Participant may change his designation of Investment Funds once every month. The Investment Funds so designated are referred to herein as the "Designated Investment Funds". 

        (b)   Each
month during the period of a Participant's participation in the Plan, the Company shall adjust the balance credited to each Participant's Account to reflect the
investment performance of the Designated Investment Funds. 

        7.04    Accounting.    

        (a)   The
Company shall, on a periodic basis, deliver to each Participant a written report of the adjusted value of the Participant's Account. The report shall separately show
all Deferrals and other contributions with respect to the Account, all investment returns with respect to each portion of the Account for which the Participant has made an investment designation, and
any payments to the Participant. 

        (b)   If
the Company has engaged a trustee, custodian, or brokerage firm to hold securities and other property acquired with respect to the Account, an accounting or report by
such trustee, custodian, or brokerage firm shall be deemed to be the Company's report for purposes of this Plan, except to the extent the Company may inform the Participants otherwise. 

6

 

        8.    Distributions.    

        8.01    Default Rule.    Except as provided in Section 8.04, a Participant's Discretionary
Sub-Account and, unless the Participant elects otherwise in accordance with Section 8.02, a Participant's Deferral Sub-Account and Performance Contribution
Sub-Account shall be distributed in a lump sum within the period of thirty (30) days beginning on the earliest of the following dates: 

        (a)   December 31,
2020; 

        (b)   The
last day of the third calendar year which begins after the Participant's Separation from Service; or 

        (c)   The
effective date of a Change of Control. 

        8.02    Election of Time and Form of Payment.    

        (a)   Each
Participant may designate a different time of payment of all or a portion of his Deferral Sub-Account by specifying the time of payment in his Deferral
Election, as provided in Section 3.02. 

        (b)   Each
Participant may elect to have payment of his Deferral Sub-Account or Performance Contribution Sub-Account made to him in one of the methods
described in this Section 8.02 instead of in the method described in Section 8.01, subject to the requirements stated in subsection (b) and in Section 8.03. 

        (c)   To
be effective with respect to any Performance Contribution or Deferrals with respect to any Year: 

        (i)    An
election with respect to a Deferral must be made before the expiration of the time for filing the Participant's Deferral Election, as provided in Section 3.02. 

        (ii)   An
election with respect to a Performance Contribution must be made before the beginning of the Year for which such Performance Contribution is earned; provided,
however, that if such Performance Contribution constitutes "performance based compensation", within the meaning of Section 409A(4)(B)(iii) of the Code and the Treasury Regulations thereunder,
an election under this Section 8.02 with respect to such Performance Contribution may be made after the beginning of the Year for which such Performance Contribution is earned, as long as it is
made at least six months before the end of such Year. 

        (d)   The
optional methods are as follows: 

        (i)    Monthly
installments over a period of three (3) years, beginning on such date as is designated in the Participant's election, subject to the provisions of
Section 8.03. 

        8.03    Changes to Payment Method.    A Participant's election to revoke the default payment method of
Section 8.01 and to elect another payment method under Section 8.02, or to change the payment method elected under Section 8.02, shall be subject to the following restrictions: 

        (a)   The
election to revoke or change shall not take effect until twelve (12) months after the date it is made. 

        (b)   Except
in the case of an election under Section 8.05 (unforeseeable emergency), the election to revoke or change may not provide for payment sooner than five
(5) years from the date payment would otherwise have been made or begun. 

        (c)   An
election to revoke or change with respect to payments scheduled to be made or to begin at a time specified by each Participant may not be made less than
12 months before the time originally specified for payment to be made or begin. 

7

 

        8.04    Payment on Death.    

        (a)   Upon
a Participant's death, the Company shall pay the balance of the Account to each Participant's Beneficiary or estate, within thirty (30) days after the date
of his death. 

        (b)   Each
Participant may designate one or more primary and contingent Beneficiaries to receive any amounts payable under this Plan on his death. The designation of
Beneficiary shall be in writing, shall be made on the Appropriate Form, shall not be effective unless filed with the Secretary of the Company before the Participant's death, and may be changed or
revoked at any time without notice to any beneficiary by the Participant's filing of a subsequent designation with the Secretary of the Company. If a Participant designates more than one Beneficiary,
each shall share equally unless such Participant specifies a different allocation or preference. If any Participant fails to designate a Beneficiary, or should no designated Beneficiary survive him or
be in existence after the Participant's death, payment shall be made to such Participant's estate. 

        (c)   If
a Beneficiary (who is a natural person) entitled to payment should die after a Participant's death but before receiving payment of the entire amount payable to him,
the balance of any amounts payable shall be paid when due to the surviving Beneficiary or Beneficiaries designated by such Participant in accordance with such Participant's designation. If there
should be no designated Beneficiaries surviving or in existence on the date of such Beneficiary's death, the balance of such payments shall be paid when due to the executor or administrator of the
last Beneficiary to die. 

        8.05    Unforeseeable Emergency.    

        (a)   A
Participant or his Beneficiary may, in the case of an unforeseeable emergency (as defined in subsection (b)), elect and shall be entitled to payment of an
amount credited to such Participant's Account subject to the following conditions: 

        (i)    The
amount payable shall not exceed the amount reasonably necessary to satisfy the emergency need (which may include amounts necessary to pay any Federal, State, or
local income taxes or penalties reasonably anticipated to result from the payment), taking into account the termination of any Deferral Elections pursuant to Section 3.05. 

        (ii)   The
Company shall not pay any amount on account of an unforeseeable emergency to the extent the emergency is or may be relieved through reimbursement or compensation
from insurance or otherwise; or by liquidation of each Participant's or the beneficiary's assets, to the extent the liquidation of such assets would not cause severe financial hardship; or by
cessation of Deferrals under this Plan. 

        (b)   For
purposes of this Plan, "unforeseeable emergency" means a severe financial hardship of each Participant or his beneficiary resulting from an illness or accident of
each Participant or beneficiary or each Participant or beneficiary's spouse or dependent (as defined in section 152(a) of the Code); loss of each Participant's or beneficiary's property due to
casualty; or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of each Participant or beneficiary. The Company shall, in its discretion,
determine whether each Participant or beneficiary is faced with an unforeseeable emergency permitting a distribution under this Section 8.05. In doing so, the Company shall refer to the
definition of "unforeseeable emergency" set forth in Treasury Regulations under Section 409A of the Code, and shall base its determination on such definition and the relevant facts and
circumstances of each case. 

        8.06    Payments to Certain Employees.    In no event shall any payment under the Plan on account of a Participant's
separation from service be made to a Participant who is a specified employee (as defined in Section 409A of the Code) as of the date of separation from service, before the date that is 

8

 

six
months after the date of separation from service or, if earlier than the end of the six-month period, the date of death of such Participant. 

        8.07    Taxes.    Payments under this Plan shall be subject to any applicable tax withholding as required under
Federal, State, and local law. 

        9.    Source of Payments.    

        9.01    Unsecured Creditor.    Nothing contained in this Plan shall create a trust or create a fiduciary relationship
of any kind between the Company and each Participant. To the extent that any person acquires a right to receive payments from the Company under this Plan, such right shall be no greater than the right
of any unsecured general creditor of the Company. 

        9.02    Unfunded.    The Company and each Participant acknowledge it is their intent and they agree that for purposes
of Title I of the Employee Retirement Income Security Act of 1974, as amended, and for purposes of the Code, and for all other purposes, this Plan constitutes an unfunded arrangement maintained for
the purpose of providing deferred compensation for an individual who is a member of a select group of management or highly compensated employees. 

        9.03    Company Obligation to Establish Trust.    

        (a)   Notwithstanding
the foregoing provisions of this Section 9, but subject to the provisions of subsection (c), below, upon the occurrence of any event
described in subsection (b), the Company shall, as soon as practicable, but in any case within sixty (60) days after notice of such event is delivered to the Company by any Participant
as provided herein: 

        (i)    establish
an irrevocable "rabbi trust", within the meaning of IRS Revenue Procedure 92-64, or any comparable provision of law then in effect, under this
Plan, which trust shall include a separate account for each Participant; and 

        (ii)   contribute
to such trust such principal amount, in cash, as shall be to sufficient to fully fund all benefits of all Participants under the Plan which have theretofore
accrued. 

        Thereafter,
each Year the Company shall (A) contribute to such trust such additional amounts as shall be required such that, after such contribution, the assets in the trust shall
be sufficient to fully fund all benefits under the Plan which have theretofore accrued, and (B) cause the trustee to deliver periodic reports to all Participants (not less frequently than
annually) with respect to the assets, gains and losses of the Participant's account under the trust. 

        (b)   The
events referred to in subsection (a) are as follows: 

        (i)    A
"Change of Control" with respect to the Company; or 

        (ii)   Any
Participant's delivery of a written notice to the Company requesting that the Company establish a rabbi trust as provided herein. 

        (c)   Notwithstanding
the foregoing provisions of this Section 9.03, in no event shall the Company be required to establish a rabbi trust: 

        (i)    during
any "restricted period" with respect to any defined benefit pension plan of the Company or an affiliate, to the extent prohibited by Section 409A(B)(3) of
the Code; or 

        (ii)   if
the establishment of such trust would violate Section 409A(B)(2) of the Code, relating to a change in the employer's financial health. 

        10.    Prohibition Against Assignment.    

        10.01    No Assignment.    Except to the extent required by law, the right of each Participant or any beneficiary to
payment of each Participant's interest in his Account shall not be subject in any manner 

9

 

to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of each Participant or beneficiary. 

        11.    Amendment and Termination.    

        11.01    Action by Company.    The Company may amend or terminate this Plan at any time by resolution of the Board of
Directors, but no such amendment or termination shall adversely affect each Participant's rights with respect to the amounts previously credited to his Account. 

        11.02    Liquidation.    This Plan shall terminate automatically upon the liquidation or dissolution of the Company.
Subject to Section 10.03, payment of each Participant's Account shall be made to him or, if each Participant is deceased, his beneficiary, in a lump sum as soon as practicable following such
liquidation or dissolution. 

        11.03    Conformance to Section 409A.    Notwithstanding any contrary provision of this Section 11 or
Section 8: 

        (a)   If
the termination of a Participant's employment with the Company does not qualify as a separation from service, as that term is used under Section 409A of the
Code, and such Participant is not disabled, as that term is defined under Section 409A of the Code, then payment under Section 8.01 or 8.02 shall not be made or begin before the relevant
time has elapsed after each Participant's separation from service with the Company. 

        (b)   The
time or schedule of any payment under this Plan may not be accelerated except as otherwise provided in this Plan and then only to the extent such acceleration would
not cause this Plan to fail to meet the requirements of section 409A of the Internal Revenue Code. 

        11.04    Intent To Defer Tax.    The Company and each Participant intend that this Plan meet the requirements of
Section 409A of the Code for the deferral (until payment) of the income taxation of the compensation deferrable under this Plan, and this Plan shall be construed accordingly. To the extent this
Plan is more restrictive than necessary to meet the requirements of Section 409A of the Code, the Company reserves the right to amend this Plan, provided such amendment would not cause the Plan
to fail to meet those requirements. 

        12.    Miscellaneous.    

        12.01    No Contract of Employment.    Nothing contained in this Plan shall be deemed to create a contract of
continuing employment between the Company and each Participant. 

        12.02    Administration.    The Board shall administer this Plan in accordance with the Plan's terms and shall have
full power and authority necessary or appropriate for carrying out its duties. The Board shall have the full power to establish any rules and procedures it finds appropriate for the administration of
this Plan. The Board may correct any defect or reconcile any inconsistency in the Plan to the extent the Board finds it necessary to carry out the purposes of the Plan. The Board shall have full power
and authority to interpret the Plan and to decide all matters arising in connection with the administration of the Plan. In exercising its power and authority, the Board shall have complete discretion
and its determinations shall be final. 

        12.03    Participant Responsible for Investment Designations.    Neither the Company nor the Board shall have any duty
to question any investment designations of a Participant or to make recommendations to any Participant with respect to investment designations. Neither the Company nor the Board shall be liable for
any reduction in the amount credited to a Participant's Account that is the result of each Participant's investment designations or a failure of each Participant to make or change an investment
designation. 

10

 

        Notwithstanding
any other provision of this Plan, a Participant's investment designation shall not be given effect if the Board in its discretion determines that such an investment would
be unlawful or impracticable if actually made by the Company. 

        12.04    Investment Designations upon Death, Incapacity, or Disability.    The provisions of this Section 12.04
shall apply notwithstanding any contrary provisions of the Plan. 

        (a)   Upon
a Participant's death, such Participant's Beneficiary or Beneficiaries to the extent of their interests, or, if each Participant fails to designate a Beneficiary or
no Beneficiary survives him, the executor or administrator of each Participant's estate, shall succeed to each Participant's right to make investment designations with respect to the Account, and all
references to each Participant in Section 7.03 and Section 12.03 shall be interpreted as references to the Beneficiary, Beneficiaries, executor, or administrator, as appropriate. 

        (b)   If,
in the Board's opinion, each Participant or a Beneficiary entitled to make investment designations under this Plan is under a legal disability or incapacitated in
any way so as to be unable to manage his financial affairs, and if the Board determines that a legal representative of each Participant or his beneficiary is authorized to make such designations on
behalf of each Participant or his Beneficiary, then such legal representative shall be considered the each Participant or beneficiary for all purposes of Section 7.03 and Section 12.03. 

        (c)   If,
in the situation described in paragraph (b) (involving each Participant's legal disability or incapacity), the Board determines that no legal representative
is authorized to make such designations on behalf of each Participant or his beneficiary, then neither the Board nor the Company shall be under any obligation to take any action with respect to the
investment designations in effect with respect to the Account. However, in such a situation, the Board may, from time to time, in its discretion, make investment designations on each Participant's
behalf, but only from among Investment Funds substantially all of the assets of which are certificates of deposit or interest bearing accounts in banks, savings banks, or savings and loan
associations; obligations of the United States government and obligations guaranteed as to principal and interest by the United States government; obligations of a state, a territory, or a possession
of the United States, or of any political subdivision of any of the foregoing, or of the District of Columbia; and cash deposit accounts. Neither the Board, the Company, nor any trustee shall be
liable to each Participant, his beneficiary, or his estate for taking no action with respect to investment designations in effect with respect to the Account or for taking the action described in the
preceding sentence. 

        12.05    Waivers.    No provision of this Plan may be modified, waived, or discharged except by an instrument in
writing executed by each Participant and an authorized officer of the Company. A waiver by either party of any breach of, or compliance with, any condition or provision of this Plan shall not be
deemed a waiver of similar or dissimilar provisions or conditions at the same or any prior or subsequent time. No agreements or representations, oral or otherwise, with respect to the subject matter
of this Plan have been made by either party that are not expressly set forth in this Plan. 

        12.06    Construction.    The validity, interpretation, construction, and performance of this Plan shall be governed
by the internal laws of the State of Colorado, without regard to the principles of conflicts of law. 

        12.07    Enforceability.    The invalidity or unenforceability of any provision of this Plan shall not affect the
validity of any other provision of this Plan, which shall remain in full force and effect. 

        12.08    Successors.    This Plan shall be binding on and inure to the benefit of the Company, its successors and
assigns, each Participant, and each Participant's heirs, executors, administrators, and legal representatives. 

11

 

        12.09    Notices.    All notices and other communications required or permitted to be given under the Plan shall be in
writing and shall be deemed to have been duly given if (1) delivered personally, (2) sent by next-day or overnight mail or delivery, or (3) sent by fax, as follows: 

        (a)   If
to the Company to: 

Allied
Motion Technologies Inc.

Suite 150

23 Inverness Way East

Englewood, CO 80112

Fax: (303) 799-8521

Attention: Secretary 

        (b)   If
to any Participant, to the address or fax number of such Participant most recently provided to the Company by the Participant. 

12

 
 Schedule 1
  Determination of Performance Criteria  

        For 2006, the Performance Contribution will be based on a Net Profit Target equivalent to an 8% return on investment, with the
investment used for such determination being shareholders' equity at the beginning of the year adjusted for the issuance of any Company stock during the year. 

        If
the Company's net profit for 2006 exceeds this Net Profit Target amount, 25% of the excess shall be allocated evenly to Richard D. Smith and Richard S. Warzala. 

13

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ALLIED MOTION TECHNOLOGIES INC. DEFERRED COMPENSATION PLAN As Amended and Restated Effective January 1, 2007

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