Document:

EX-10.53

Exhibit 10.53

ANNUAL INCENTIVE PLAN FY10

OBJECTIVE 

To create an annual short-term incentive plan that encourages and rewards the attainment of
established corporate and division goals. The plan is based the following metrics: Adjusted
Earnings Per Share (“Adjusted EPS”), Consolidated Adjusted EBITDA, Adjusted EBITDA (Division) and
Return on Working Capital (Division). Each metric is weighted as a percent of total incentive
opportunity.

PLAN SUMMARY

Annual Incentive Plan payouts will be determined and distributed after year-end financials are
audited and such payouts are approved by Exide’s Board of Directors or any committee thereof where
applicable. Adjusted Net Income acts as a plan trigger; no plan payouts will be made unless Exide
achieves 50% or better of the Consolidated Adjusted Net Income approved by the Board of Directors.
Corporate and division metrics have the following performance levels: Threshold is defined as
(80%) of target performance metric and results in a payout of 50% of your personal target; Target
is defined as (100%) of the target performance metrics and result in a payout at your personal
target; and Maximum is defined as (120%) of target performance level that results in a payout at
200% of your personal target. Threshold is defined as the level below which no award would be
earned and maximum is defined as the level at which point the award becomes capped.

TARGET

The TARGET, the performance level at which a target level incentive is paid, for each Division and
Corporate is set pursuant to the FY10 Operating Plan.

WEIGHTING

The FY10 Exide Annual Incentive Plan will include global consolidated Exide metrics and Division
metrics. Shown below is the weighting of the metrics.

	 	 	 	 	 	 	 	 	 
	Metrics	 	Corporate	 	Division1
	Exide Adjusted EPS
	 	 	70	%	 	 	15	%
	Exide Consolidated Adjusted EBITDA
	 	 	30	%	 	 	10	%
	Adjusted EBITDA (By Division)
	 	 	N/A	 	 	 	50	%
	Return on Working Capital (By Division)
	 	 	N/A	 	 	 	25	%

 

			
	1	 	Exide Adjusted EPS and Exide Consolidated Adjusted EBITDA account for 25% of the
Division total incentive opportunity; Division Adjusted EBITDA and Division Return on Working
Capital account for 75% of the Division total incentive opportunity.

Page 1 of 5

 

ANNUAL INCENTIVE PLAN FY10

EXAMPLE—DIVISION EMPLOYEE

(Assume Adjusted Net Income Trigger of 50% or better of Consolidated Adjusted Net Income is met)

	 	 	 	 	 	 
	Base Salary
	 	$	50,000	 
	Incentive Target
	 	 	5	%
	Target Payout
	 	$	2,500	 
	 
	 	 	 	 
	Plan
	 	 	 	 
	Threshold 80%
	 	$	1,250 (50% Payout)  
	Target 100%
	 	$	2,500 (100% Payout)
	Maximum 120%
	 	$	$5,000 (200% Payout)

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Actual	 	 	 	 	 	 
	Metric	 	Weight	 	Performance	 	Payout
	EBITDA

	 	 	50	%	 	 	105	%	 	50% X 2,500 = $1,250 X 125%=
	 	$	1,562.50	 
	Return on Working Capital

	 	 	25	%	 	 	90	%	 	25% X 2,500 = $625 X 75% =
	 	$	468.75	 
	Consolidated Adjusted EBITDA

	 	 	10	%	 	 	100	%	 	10% X 2,500 = $250 X 100% =
	 	$	250.00	 
	Corporate Adjusted EPS

	 	 	15	%	 	 	100	%	 	15% X 2,500 = $375 X 100% =
	 	$	375.00	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	TOTAL PAYOUT:
	 	$	2,656.25	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 

EXAMPLE—CORPORATE EMPLOYEE

(Assume Adjusted Net Income Trigger of 50% or better of Consolidated Adjusted Net Income is met)

	 	 	 	 	 	 
	Base Salary
	 	$	50,000	 
	Incentive Target
	 	 	5	%
	Target Payout
	 	$	2,500	 
	 
	Plan
	 	 	 	 
	Threshold 80%
	 	$	1,250 (50% Payout)
	Target 100%
	 	$	2,500 (100% Payout)
	Maximum 120%
	 	$	5,000 (200% Payout)

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Actual	 	 	 	 	 	 
	Metric	 	Weight	 	Performance	 	Payout
	Consolidated Adjusted EBITDA
	 	30%	 	100%	 	30% X 2,500 = $750 X 100% =	 	$	750.00	 
	Corporate Adjusted EPS
	 	70%	 	100%	 	70% X 2,500 = $1,750 X 100% =	 	$	1,750.00	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	TOTAL PAYOUT:	 	$	2,500.00	 
	 
	 	 	 	 	 	 

Page 2 of 5

 

ANNUAL INCENTIVE PLAN FY10

DEFINITIONS

Adjusted EBITDA

	 	•	 	Earnings before Interest, Taxes, Depreciation, Amortization and Restructuring charges.
	 
	 	•	 	Further adjusts reported earnings for the effect of:

	 	•	 	Non-cash currency remeasurement gains or losses;
	 
	 	•	 	The non-cash gain or loss from revaluation of the Company’s
warrants liability;
	 
	 	•	 	Impairment charges;
	 
	 	•	 	Gains or losses on asset sales;
	 
	 	•	 	Non-cash stock compensation expense; and
	 
	 	•	 	Minority interest.

Adjusted Net Income

	 	•	 	Net Income plus or minus

	 	•	 	After tax reorganization expenses relating to ongoing
claims administration and settlement;
	 
	 	•	 	Non-cash gain or loss from revaluation of the Company’s warrants
liability (no tax effect as such is not subject to U.S. Income Taxes);
	 
	 	•	 	After tax restructuring charges;
	 
	 	•	 	Non-cash, after tax currency remeasurement gains or losses which
relates principally to historic intercompany debt; and
	 
	 	•	 	The impact of one-time tax items, including the impact of non-cash
valuation allowances.

Adjusted EPS

	 	•	 	Adjusted net income divided by weighted average shares outstanding.
	 
	Working Capital

	 	•	 	(Accounts Receivable + Inventory) - (Accounts Payable + Accrued Expense)
	 
	Return on Working Capital

	 	•	 	Adjusted EBITDA / Working Capital

Page 3 of 5

 

ANNUAL INCENTIVE PLAN FY10

TRANSFERS

The methodology to be used when calculating the year-end incentive payouts for the Exide Annual
Incentive Plan participants who transfer between divisions or to / from the Corporate group during
the fiscal year will be as follows:

	A.	 	Transfer During the First Quarter of the Fiscal Year

	 	1.	 	Incentive payouts for Annual Incentive Plan participants who transfer between divisions
or to / from the Corporate group during the first quarter of the fiscal year will be
calculated as if the participants had worked the full year in the division / group to which
they transferred. There will be no prorated calculation.

	B.	 	Transfer After the First Quarter of the Fiscal Year

	 	1.	 	Annual Incentive Plan participants who transfer between divisions or to / from the
Corporate group after the first quarter of the fiscal year will receive the greater of:

	 	a.	 	The incentive payout they would have received had they not transferred. The
calculation will be made at year end using the participant’s old base salary and old
target percentage for the business unit in place prior to their transfer; or
	 
	 	b.	 	A prorated incentive calculated at year-end incorporating the amount of time
spent in each division / group during the fiscal year. For time spent prior to the
transfer, the calculation will incorporate the participant’s old base salary, old target
AIP percentage and the old business unit AIP on a prorated basis. For the time spent
subsequent to the transfer, the calculation will incorporate the participant’s new base
salary, new target AIP percentage and new business unit AIP on a prorated basis.

CHANGE IN AIP PARTICIPANT PERCENTAGE

	 	A.	 	If an AIP participant is at a salary and one target % for a portion of the year and is
transferred or promoted within the same business unit to a higher target %, the participant
will receive the higher salary and target % as of March 31st for the entire
year.
	 
	 	B.	 	If an AIP participant moves to / from a sales incentive plan during the year, the AIP
incentive will be calculated on a prorated basis. For time spent in the AIP plan during
the year, the participant’s incentive will be calculated using the AIP plan. For time
spent in the sales plan during the year, the participant’s incentive will be calculated
using the sales plan.

Page 4 of 5

 

ANNUAL INCENTIVE PLAN FY10

ELIGIBILITY

To be eligible for the plan, the participant must be employed by Exide, in an eligible position
before March 1, 2010, performing at a level of “meets” or above and not on a leave of absence at
the time of payout. An incentive payout for participants performing below “meets” or on a
Performance Improvement Plan must be approved by the EVP Human Resources. Participants who join
Exide during the plan year before March 1, 2010 will be eligible for a pro rata portion of their
earned payout. Participation in the plan is at the sole discretion of the “Company”. The President
and CEO of EXIDE TECHNOLOGIES, at his discretion, may adjust or withhold all or part of a payout to
any individual(s). Participants are reviewed and participation is determined on an annual basis.
In order to receive the year end payout, participants must be employed by Exide in an eligible
position at the time of payout.

LEAVE OF ABSENCE

If an employee was on a leave of absence for more than sixty (60) days during FY10, the incentive
will be prorated for the period greater than 60 days the employee was on leave. Prorated incentive
payouts must be reviewed and approved by the Senior Director of Human Resources to insure
consistency throughout North America and the Vice President of Benefits for Europe. For example,
if an employee is on a leave for 90 days during FY10, the employee will receive 11/12’s of their
incentive. If an employee is on a Leave of Absence when the incentive payments are paid, the
payout will be effective when the employee returns from the leave.

POINTS TO REMEMBER

	 	•	 	Payout will be after FY10 results have been finalized and audited and
approved.
	 
	 	•	 	Participation is at the discretion of the Company.
	 
	 	•	 	Participation is determined on an annual basis.
	 
	 	•	 	The participant must be employed by Exide in an eligible position at the time
of payout.
	 
	 	•	 	The individual must be at or exceed a “meets” performance level to be eligible
for a payout and not on a Performance Improvement Plan.
	 
	 	•	 	Exceptions to this plan and all other rules must be approved by the EVP, Human
Resources.
	 
	 	•	 	AIP payouts are capped at 200% of TARGET.
	 
	 	•	 	Questions of interpretation and all disputes will be resolved by a committee,
consisting of the President and CEO, the EVP and CFO, and the EVP of Global Human
Resources and Communication and in certain situations the Compensation Committee
of the Exide Board of Directors.

Page 5 of 5EX-10.1

Exhibit 10.1

EXECUTION COPY

VOTING AGREEMENT

by and among

STEPHEN W. BERSHAD,

SWB HOLDING CORPORATION,

GENERAL DYNAMICS ADVANCED INFORMATION SYSTEMS, INC.

and

VISION MERGER SUB, INC.

dated as of

June 4, 2009

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE 1
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	1.01 Certain Definitions
	 	 	1	 
	 
	1.02 Representations and Warranties of the Stockholders
	 	 	1	 
	 
	1.03 Representations and Warranties of Parent and Merger Sub
	 	 	3	 
	 
	 	 	 	 
	ARTICLE 2
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	2.01 Transfer of the Shares
	 	 	3	 
	 
	2.02 Adjustments
	 	 	4	 
	 
	 	 	 	 
	ARTICLE 3
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	3.01 Voting Agreement
	 	 	4	 
	 
	3.02 Proxy
	 	 	5	 
	 
	3.03 Dissenting Shares
	 	 	6	 
	 
	3.04 Succession to Shares
	 	 	6	 
	 
	3.05 No Solicitation
	 	 	6	 
	 
	3.06 Disclosure
	 	 	6	 
	 
	 	 	 	 
	ARTICLE 4
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	4.01 Termination
	 	 	7	 
	 
	4.02 Expenses
	 	 	7	 
	 
	4.03 Further Assurances
	 	 	7	 
	 
	4.04 Press Releases
	 	 	7	 
	 
	4.05 Specific Performance
	 	 	7	 
	 
	4.06 Miscellaneous
	 	 	7	 

-i-

 

VOTING AGREEMENT

     This VOTING AGREEMENT, dated as of June 4, 2009 (this “Agreement”), is by and among General
Dynamics Advanced Information Systems, Inc., a Delaware corporation (“Parent”), Vision Merger Sub,
Inc., a Delaware corporation (“Merger Sub”), and the undersigned stockholders (each a “Stockholder”
and collectively, the “Stockholders”) of Axsys Technologies, Inc., a Delaware corporation (the
"Company”).

     WHEREAS, Parent, Merger Sub and the Company have entered into an Agreement and Plan of Merger,
dated as of the date hereof (as amended from time to time, the “Merger Agreement”), which provides,
among other things, that, upon the terms and subject to the conditions therein, Merger Sub will
merge with and into the Company (the “Merger”), and as a result of the Merger, the Company will
become an indirect, wholly-owned subsidiary of Guarantor; and

     WHEREAS, each Stockholder acknowledges that, as a condition to the willingness of Parent and
Merger Sub to enter into the Merger Agreement (and for Guarantor to perform its obligations
thereunder), Guarantor, Parent and Merger Sub have requested that each Stockholder agree, and in
order to induce Guarantor, Parent and Merger Sub to enter into the Merger Agreement, each
Stockholder has agreed, to enter into this Agreement.

     NOW, THEREFORE, in consideration of the foregoing premises and the representations,
warranties, covenants and agreements set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and subject to the terms and
conditions set forth herein, the parties hereto hereby agree as follows:

ARTICLE 1

 

     1.01 Certain Definitions. Capitalized terms used but not otherwise defined herein
have the meanings ascribed to such terms in the Merger Agreement.

     1.02 Representations and Warranties of the Stockholders. Each Stockholder represents
and warrants to Parent and Merger Sub as follows:

          (a) The Stockholder (i) is the sole record or beneficial owner, except for the Shares held of
record by HoldCo (as defined below), which are also beneficially owned by Bershad (as defined
below) (the term “beneficial owner” shall be as defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), which meaning will apply to all uses of the term
“beneficial owner” (or any variation thereof) contained in this Agreement), of, and has good title
to, the shares of Company Common Stock identified as being held by such Stockholder on
Annex A hereto (all such shares of Company Common Stock, including any restricted shares of
Company Common Stock owned by such Stockholder, being hereinafter referred to as the “Shares” of
such Stockholder), free and clear of any Liens or voting agreements and commitments of every kind
(including any restriction on the right to vote, sell or otherwise dispose of its Shares), except
as set forth in this Agreement and (ii) holds stock options identified as being held by such
Stockholder (the “Options”) to acquire the number of shares of Company Common Stock as set forth on
Annex A hereto.

          
 

 

          (b) Other than its Options (if applicable), its Shares constitute all of the securities (as
defined in Section 3(10) of the Exchange Act, which definition will apply to all uses of the term
“securities” contained in this Agreement) of the Company owned beneficially or otherwise, directly
or indirectly, by the Stockholder (excluding (i) any securities beneficially owned by any of its
affiliates or associates (as such terms are defined in Rule 12b-2 under the Exchange Act, which
definitions will apply to all uses of the terms “affiliates” and “associates,” respectively,
contained in this Agreement) as to which it does not have voting or investment power and (ii) the
Shares and Options (if applicable) owned by the other Stockholder).

          (c) Except for its Shares, its Options (if applicable) and the Shares and Options (if
applicable) owned by the other Stockholder, the Stockholder does not, directly or indirectly,
beneficially own or have any option, warrant, or other Rights to acquire any securities of the
Company that are or may by their terms become entitled to vote or any securities that are
convertible or exchangeable into or exercisable for any securities of the Company that are or may
by their terms become entitled to vote, nor is the Stockholder subject to any contract, commitment,
arrangement, understanding or relationship (whether or not legally enforceable), other than this
Agreement, that obligates it to vote or acquire any securities of the Company. The Stockholder
holds sole and exclusive power to vote the Shares and has not granted any proxy to any other Person
to vote the Shares, subject to the limitations set forth in this Agreement.

          (d) (i) Stephen W. Bershad (“Bershad”) owns, directly or indirectly, all the outstanding
capital stock and equity of SWB Holding Corporation, a Delaware corporation (“HoldCo”); (ii) no
capital stock or equity of HoldCo is or may become required to be issued (other than to Bershad) by
reason of any security or otherwise; (iii) there are no contracts, commitments, understandings or
arrangements by which HoldCo is bound to sell or otherwise transfer any capital stock or equity of
HoldCo (other than to Bershad); (iv) there are no contracts, commitments, understandings or
arrangements relating to Bershad’s right to vote or to dispose of the capital stock or equity of
HoldCo; (v) all the capital stock and equity interests of HoldCo (A) have been duly authorized and
are validly issued and outstanding, fully paid and nonassessable and not subject to or issued in
violation of any preemptive right, purchase option, call option, right of first refusal,
subscription right or any similar right under any provision of the DGCL, HoldCo’s Constituent
Documents or any contract or commitment to which HoldCo is a party or otherwise bound, and (B) were
issued in material compliance with all applicable Laws, including federal and state securities
laws; (vi) Bershad is the sole director and officer of HoldCo; and (vii) Bershad exclusively
controls HoldCo.

          (e) The Stockholder has the legal capacity or power and authority, as the case may be, to
execute, deliver and perform its obligations under, and has duly executed and delivered, this
Agreement. This Agreement is the Stockholder’s valid and legally binding obligation, enforceable
against the Stockholder in accordance with its terms (except as enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar Laws
of general applicability relating to or affecting creditors’ rights or by general equity
principles). If the Stockholder is married and the Shares constitute community property, then this
Agreement (including the granting of the irrevocable proxy as provided for in Section 3.02)
has been duly authorized, executed and delivered by, and

2

 

constitutes a valid and binding agreement of, such Stockholder’s spouse, enforceable against
such person in accordance with its terms.

          (f) No consents, authorizations or approvals of, or filings or registrations with, or
notifications to, any Governmental Authority or with any third party are required to be made or
obtained by the Stockholder in connection with the execution, delivery or performance by the
Stockholder of this Agreement or the transactions contemplated hereby.

          (g) The execution, delivery and performance of this Agreement by the Stockholder does not and
will not constitute (i) a violation of any Law to which the Stockholder or any of the Stockholder’s
properties (including the Shares) is subject or bound or (ii) a breach or violation of, or a
default under, or conflict with, (A) the Constituent Documents of the Company or any of its
Subsidiaries or (B) the Constituent Documents of such Stockholder, if applicable.

          (h) There is no suit, claim, action, charge or proceeding (including any arbitration
proceeding or dispute resolution proceeding) pending or, to the knowledge of the Stockholder (after
reasonably inquiry), threatened that, individually or in the aggregate, has impaired, or would
reasonably be expected to impair, the ability of the Stockholder to perform its obligations under
this Agreement or consummate the transactions contemplated hereby.

     1.03 Representations and Warranties of Parent and Merger Sub. Parent and Merger Sub
represent and warrant to each Stockholder as follows:

          (a) Each of Parent and Merger Sub is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Delaware.

          (b) Each of Parent and Merger Sub has the corporate power and authority to execute, deliver
and perform its obligations under this Agreement. Each of Parent and Merger Sub has duly
authorized, executed and delivered this Agreement. This Agreement has been duly authorized by all
necessary corporate action of each of Parent and Merger Sub. This Agreement is each of Parent’s
and Merger Sub’s valid and legally binding obligation, enforceable against each of them in
accordance with its terms (except as enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer and similar Laws of general
applicability relating to or affecting creditors’ rights or by general equity principles).

ARTICLE 2

 

     2.01 Transfer of the Shares. During the term of this Agreement, except as otherwise
provided herein, each Stockholder will not, directly or indirectly, (a) tender into any tender or
exchange offer or otherwise sell, transfer (including transfer by merger, testamentary or intestate
succession, interspousal disposition pursuant to a domestic relations proceeding or otherwise by
operation of Law), pledge, hypothecate, assign, gift, constructively sell or otherwise dispose of,
or encumber with any Lien, or permit or suffer the encumbrance of any Lien on, any of its Shares
(or any economic, voting or other direct or indirect right, title or interest therein), including,
in each case, by operation of Law, (b) deposit its Shares into a voting trust, enter into any other
voting agreement or arrangement with respect to its Shares or grant any proxy, power of attorney

3

 

or other authorization or consent in or with respect to its Shares (other than to the other
Stockholder), (c) enter into any contract, option or other arrangement or undertaking with respect
to the direct or indirect acquisition or sale, transfer, pledge, hypothecation, assignment, gift,
constructive sale, or other disposition of, or encumbrance with any Lien on, any interest in or the
voting of any shares of Company Common Stock or any other securities of the Company (or any
economic, voting or other direct or indirect right, title or interest therein), or any Rights with
respect thereto, (d) take any other action which would, or could reasonably be expected to, result
in a diminution of the voting power represented by its Shares or in any way restrict, limit or
interfere in any material respect with the performance of such Stockholder’s obligations hereunder
or (e) offer, commit or agree to take any of the foregoing actions. Any purported action by a
Stockholder in violation of this Section 2.01 shall be null and void.

     2.02 Adjustments.

          (a) In the event (i) of any stock dividend, stock split, recapitalization, reclassification,
combination or exchange of shares of capital stock or other securities of the Company on, of or
affecting the Shares or the like or any other action that would have the effect of changing a
Stockholder’s ownership of Company Common Stock or other securities of the Company or (ii) a
Stockholder becomes the beneficial owner of any additional shares of Company Common Stock or other
securities of the Company that entitle such Stockholder to vote on the matters contemplated herein
(including pursuant to any exercise or conversion of any Rights, including any Company Stock
Options or Company Stock-Based Awards), then the terms of this Agreement will apply to the shares
of capital stock held by such Stockholder immediately following the effectiveness of the events
described in clause (i) or such Stockholder becoming the beneficial owner thereof as described in
clause (ii), and shall be deemed to be “Shares” with respect to such Stockholder for all purposes
hereunder.

          (b) Each Stockholder hereby agrees, while this Agreement is in effect, to promptly notify
Parent in writing of the number of any new shares of Company Common Stock or other securities of
the Company acquired by such Stockholder, if any, after the date hereof.

ARTICLE 3

 

     3.01 Voting Agreement. Unless otherwise directed in writing by Parent, at every
meeting of the Company Stockholders, however called, and at every postponement or adjournment
thereof, and on every action or approval of Company Stockholders (including by written consent),
each Stockholder irrevocably agrees to, or to cause the holder of record on the applicable record
date to, vote (or cause to be voted) (or consent or cause to be consented) its Shares (a) in favor
of (i) the Company Stockholder Approval, including the approval and adoption of the Merger
Agreement and the approval of the Merger and the other Transactions and (ii) any other matter that
is required by applicable Law or a Governmental Authority to be approved by the Company
Stockholders to facilitate the approval and consummation of the Merger and the other Transactions
and (b) against (i) any Acquisition Proposal, (ii) any action or agreement that would, or would
reasonably be expected to, result in a breach in any respect of any covenant, agreement,
representation or warranty of the Company under the Merger Agreement, and (iii) the following
actions (other than the Merger and the other Transactions): (A) any extraordinary corporate
transaction, such as a merger, consolidation or other business

4

 

combination involving the Company or any of its Subsidiaries; (B) any sale, lease or transfer
of a material amount of assets of the Company or any of its Subsidiaries, or a reorganization,
recapitalization, dissolution or liquidation of the Company or its Subsidiaries; (C) (1) any change
in the board of directors of the Company as of the date hereof; (2) any change in the present
capitalization of the Company or any amendment of the Company’s certificate of incorporation or
bylaws, as amended prior to the date of this Agreement; (3) any other material change in the
Company’s corporate structure or business; or (4) any other action that, in the case of each of the
matters referred to in clauses (C)(1), (2) and (3), would, or would reasonably be expected to,
prevent, impede, frustrate, interfere with, delay, postpone or adversely affect the Merger or the
other Transactions or that could facilitate an Acquisition Proposal or Superior Proposal. Each
Stockholder shall, or shall cause the holder of record on the applicable record date, to cast votes
(or cause votes to be cast), or give consents (or cause consents to be given), with respect to all
of its Shares in accordance with such procedures relating thereto so as to ensure that all of its
Shares are duly counted, including for purposes of determining that a quorum is present and for
purposes of recording the results of such vote (or consent). Unless and until this Agreement shall
be terminated pursuant to Section 4.01, the obligations of the Stockholders specified
herein will apply whether or not (I) the Company Board (or any committee thereof) shall make any
Company Board Change of Recommendation or (II) the Company breaches any of its representations,
warranties, agreements or covenants set forth in the Merger Agreement.

     3.02 Proxy. Each Stockholder, by this Agreement, does hereby constitute and appoint
Parent and Merger Sub, or any nominee thereof, with full power of substitution and re-substitution,
during and for the term of this Agreement, as its true and lawful attorney-in-fact and proxy for
and in its name, place and stead, to vote, express consent or dissent, or otherwise utilize such
voting power with respect to its Shares in the manner and to the extent contemplated by Section
3.01 as such proxy or its substitute or re-substitute shall, in its sole discretion, deem
proper with respect to its Shares. The proxy and power of attorney granted by each Stockholder
pursuant to this Section 3.02 is a proxy and power coupled with an interest (in accordance
with Section 212 of the DGCL), is irrevocable during and for the term of this Agreement, and is
granted in order to secure each Stockholder’s performance under this Agreement and also in
consideration of Parent and Merger Sub entering into this Agreement and the Merger Agreement. The
power of attorney granted hereunder is a durable power of attorney and shall survive the
bankruptcy, death or incapacity of a Stockholder, as applicable. Each Stockholder hereby ratifies
and confirms all that such irrevocable proxy may lawfully do or cause to be done by virtue hereof.
Each Stockholder shall execute and deliver to Parent any proxy cards that such Stockholder receives
to vote in favor of the approval and adoption of the Merger Agreement and the approval of the
Merger and the other Transactions. Each Stockholder represents and warrants that any proxies
heretofore made or granted in respect of its Shares are not irrevocable, and hereby revokes any and
all other proxies with respect to its Shares that it may have heretofore made or granted. If a
Stockholder fails for any reason to be counted as present, consent or vote its Shares in accordance
with the requirements of Section 3.01 (or anticipatorily breaches Section 3.01),
then Parent shall have the right to cause to be present, consent or vote such Stockholder’s Shares
in accordance with Section 3.01. For Shares as to which a Stockholder is the beneficial
but not the record owner, such Stockholder shall cause the record owner of any such Shares to grant
to Parent and Merger Sub a proxy to the same effect as that contained herein. Notwithstanding
anything to the contrary contained herein, the irrevocable

5

 

proxy granted hereby shall automatically terminate and be of no further force or effect upon
termination of this Agreement.

     3.03 Dissenting Shares. Each Stockholder hereby irrevocably and unconditionally
(a) waives, and agrees to prevent the exercise of, any rights of appraisal, any dissenters’ rights
and any similar rights relating to the Merger or the other Transactions that it may directly or
indirectly have by virtue of the ownership of its Shares, and (b) agrees not to commence or
participate in, and to take all actions necessary to opt out of any class in any class action with
respect to, any claim, derivative or otherwise, against Guarantor, Parent, Merger Sub, the Company
or any of their respective successors relating to the negotiation, execution or delivery of this
Agreement or the Merger Agreement or the consummation of the Merger, including any claim
(i) challenging the validity of, or seeking to enjoin the operation of, any provision of this
Agreement or (ii) alleging a breach of any fiduciary duty of the Company Board in connection with
the Merger Agreement, the Merger or the other Transactions. Notwithstanding the foregoing, nothing
in this Section 3.03 shall constitute, or be deemed to constitute, a waiver or release by
either Stockholder of any claim or cause of action against Parent or Merger Sub to the extent
arising out of a breach of this Agreement by Parent or Merger Sub.

     3.04 Succession to Shares. Each Stockholder agrees that this Agreement and the
obligations hereunder shall attach to its Shares and shall be binding upon any Person to which
legal or beneficial ownership of its Shares shall pass, whether by operation of Law or otherwise,
including such Stockholder’s heirs, guardians, administrators or successors, as applicable. Prior
to, directly or indirectly, transferring any rights (including voting rights) or ownership in or to
any of its Shares, each Stockholder agrees to cause the potential transferee of such Shares to
enter into an agreement with Parent and Merger Sub on substantially the same terms as the terms
hereof. Each Stockholder agrees that it shall authorize and request the Company to notify its
transfer agent that there is a stop order with respect to all of the Shares and that this Agreement
places limits on the voting of its Shares.

     3.05 No Solicitation. Each Stockholder agrees that Section 4.09 of the Merger
Agreement shall apply to each Stockholder mutatis mutandis. Notwithstanding anything to the
contrary in this Section 3.05, any action which is permitted by the Merger Agreement to be
taken by a Stockholder in its individual capacity as an officer or director of the Company shall
not be prohibited by this Section 3.05.

     3.06 Disclosure. Each Stockholder (a) hereby authorizes Guarantor, Parent and the
Company to publish and disclose in any announcement or disclosure in connection with the Merger or
the other Transactions, including the Proxy Statement, such Stockholder’s identity and ownership of
its Shares and the nature of such Stockholder’s obligations under this Agreement and (b) agrees to
promptly furnish to Parent any information it may reasonably request for the preparation of any
such announcement or disclosure. Each Stockholder agrees to promptly notify Parent and the Company
of any required corrections with respect to any information supplied by it for use in any such
announcement or disclosure, if and to the extent that any such information shall have become false
or misleading in any material respect.

6

 

ARTICLE 4

 

     4.01 Termination. This Agreement will terminate upon the earliest to occur of (a) the
Effective Time, (b) the date the Merger Agreement is terminated in accordance with its terms, and
(c) the mutual written agreement of the Stockholders and Parent (such date of termination, the
"Termination Date”); provided, however, that (i) this Section 4.01 and Sections
1.01, 4.02, 4.04, 4.05 and 4.06 (as applicable) shall survive
any such termination and (ii) such termination shall not relieve any party for any breach of this
Agreement occurring prior to such termination.

     4.02 Expenses. Except as may otherwise be specifically provided herein, all costs and
expenses incurred in connection with this Agreement and the transactions contemplated hereby will
be paid by the party incurring such expenses, whether or not the Merger is consummated.

     4.03 Further Assurances. Each Stockholder agrees that prior to the Termination Date
in accordance with its terms, such Stockholder shall not take any action that would make any
representation or warranty of such Stockholder contained herein untrue or incorrect or have the
effect of preventing, impeding, interfering with or adversely affecting the performance by such
Stockholder of its obligations under this Agreement. Each party hereto will execute and deliver
all such further documents and instruments and take all such further action as any other party may
reasonably request in order to consummate the transactions contemplated hereby.

     4.04 Press Releases. Parent and Merger Sub, on the one hand, and the Stockholders, on
the other hand, will consult with each other before issuing any press release with respect to the
transactions contemplated by this Agreement, the Merger Agreement or the Transactions and will not
issue any such press release without the prior written consent of the other parties, which will not
be unreasonably withheld, conditioned or delayed; provided, however, that a party may, without the
prior consent of the other party (but after prior consultation, to the extent practicable in the
circumstances), issue any such press release as may be required by applicable Law or securities
exchange rules.

     4.05 Specific Performance. The parties agree that irreparable damage would occur in
the event that any of the provisions of this Agreement were not performed in accordance with its
specific terms or were otherwise breached. Each party agrees that, in the event of any breach or
threatened breach by any other party of any covenant or obligation contained in this Agreement, the
non-breaching party shall be entitled (in addition to any other remedy that may be available to it
whether in law or equity, including monetary damages) to seek and obtain (a) a decree or order of
specific performance to enforce the observance and performance of such covenant or obligation and
(b) an injunction restraining such breach or threatened breach. Each party further agrees that no
other party or any other Person shall be required to obtain, furnish or post any bond or similar
instrument in connection with or as a condition to obtaining any remedy referred to in this
Section 4.05, and each party irrevocably waives any right it may have to require the
obtaining, furnishing or posting of any such bond or similar instrument.

     4.06 Miscellaneous.

          (a) All representations and warranties contained herein are made as of the date hereof and
will not survive the consummation of the Merger or any termination of this

7

 

Agreement. The covenants and agreements made herein will survive in accordance with their
respective terms.

          (b) At any time prior to the Termination Date, any provision of this Agreement may be (i)
waived by the party benefited by the provision, but only in writing (provided that no such waiver
will be applicable except in the specific instance for which it is given), or (ii) amended or
modified, but only by a written agreement executed in the same manner as this Agreement, except to
the extent that any such amendment would violate applicable Law. Except as set forth elsewhere in
this Agreement, at any time prior to the Termination Date, the parties may extend the time for
performance of any of the covenants, agreements or conditions of the other parties to this
Agreement, but only in a written agreement executed and delivered by or on behalf of the party
against which it is sought to be enforced. Neither the failure nor any delay by any party in
exercising any right, power or privilege under this Agreement will operate as a waiver of such
right, power or privilege, and no single or partial exercise of any such right, power or privilege
will preclude any other or further exercise of such right, power or privilege or the exercise of
any other right, power or privilege.

          (c) This Agreement represents the entire understanding of the parties regarding the
transactions contemplated hereby and supersedes any and all other oral or written agreements,
representations and understandings previously made or purported to be made with respect thereto.
Other than those set forth in the Merger Agreement, no representation, warranty, inducement,
promise, understanding or condition not set forth in this Agreement has been made or relied on by
any party in entering into this Agreement. Nothing expressed or implied in this Agreement is
intended to confer any rights, remedies, obligations or liabilities upon any Person other than the
parties hereto.

          (d) This Agreement and the agreements, instruments and documents contemplated hereby and all
disputes between the parties under or relating to this Agreement or the facts and circumstances
leading to its execution and delivery, whether in contract, tort or otherwise, will be governed by
and construed in accordance with the Laws of the State of Delaware, without giving effect to
conflicts of laws principles that would result in the application of the Law of any other State.
The Delaware Court of Chancery sitting in Wilmington, Delaware (and if the Delaware Court of
Chancery shall be unavailable, any Delaware state court and the Federal court of the United States
of America sitting in the State of Delaware) will have exclusive jurisdiction over any and all
disputes among the parties, whether at law or in equity, based upon, arising out of or relating to
this Agreement and the agreements, instruments and documents contemplated hereby or the facts and
circumstances leading to its execution and delivery, whether in contract, tort or otherwise. Each
of the parties irrevocably consents to and agrees to submit to the exclusive jurisdiction of such
courts, agrees that process may be served upon them in any manner authorized by the Laws of the
State of Delaware, and hereby waives, and agrees not to assert in any such dispute, to the fullest
extent permitted by applicable Law, any claim that (i) such party is not personally subject to the
jurisdiction of such courts, (ii) such party and such party’s property is immune from any legal
process issued by such courts or (iii) any litigation commenced in such courts is brought in an
inconvenient forum. EACH OF THE PARTIES HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
OUTSIDE THE TERRITORIAL JURISDICTION OF THE COURTS REFERRED TO IN THIS SECTION 4.06(d) IN
ANY ACTION OR PROCEEDING UNDER OR RELATING TO THIS

8

 

AGREEMENT OR THE FACTS AND CIRCUMSTANCES LEADING TO ITS EXECUTION AND DELIVERY BY MAILING
COPIES THEREOF BY REGISTERED UNITED STATES MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS AS SPECIFIED IN OR PURSUANT TO SECTION 4.06(f). HOWEVER, THE FOREGOING SHALL NOT
LIMIT THE RIGHT OF A PARTY TO EFFECT SERVICE OF PROCESS ON ANY OTHER PARTY BY ANY OTHER LEGALLY
AVAILABLE METHOD. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

          (e) The table of contents and Section headings contained in this Agreement are for reference
purposes only and do not limit or otherwise affect any of the substance of this Agreement.

          (f) All notices, requests and other communications given or made under this Agreement must be
in writing and will be deemed given when personally delivered, transmitted by facsimile (with
confirmation of successful transmission) or mailed by registered or certified mail (return receipt
requested) to the persons, addresses and/or facsimile numbers set forth below or such other person,
address and/or facsimile number as such party may specify by notice given in accordance with this
Section 4.06(f).

     If to either of the Stockholders:

Axsys Technologies, Inc.

175 Capital Boulevard, Suite 103

Rocky Hill, CT 06067

Attention:     Stephen W. Bershad

Facsimile:     (860) 257-0200

     If to Parent or Merger Sub, to:

General Dynamics Advanced Information Systems, Inc.

2941 Fairview Park Drive

Suite 100

Falls Church, VA 22042-4513

Attention:     David A. Savner

Facsimile:     (703) 876-3554

     With a copy to:

Jenner & Block LLP

330 North Wabash Avenue

Chicago, IL 60611-7603

Attention:     Thaddeus J. Malik

Facsimile:     (312) 840-7313

9

 

          (g) This Agreement may be executed in one or more counterparts (whether by facsimile,
electronic transmission or otherwise), each of which will be deemed to constitute an original, and
transmission of a duly executed counterpart hereof by electronic means will be deemed to constitute
delivery of an executed original manual counterpart hereof.

          (h) No party may assign either this Agreement or any of its rights or interests, or delegate
any of its duties, hereunder, in whole or in part, without the prior written consent of the other
parties; provided that Merger Sub may assign any of its rights, interests and obligations
hereunder, in whole or from time to time in part, to any direct or indirect Subsidiary of Guarantor
without the consent of any other party, but no such assignment shall relieve Parent of its
obligations hereunder. Any attempt to make any assignment in violation of this Section
4.06(h) will be null and void. Subject to the preceding sentences of this
Section 4.06(h), this Agreement will be binding upon, inure to the benefit of and be
enforceable by, the parties and their respective successors and permitted assigns.

          (i) The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of the other
provisions hereof. If any provision of this Agreement or the application thereof to any Person or
circumstance is determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid, void or unenforceable, will
remain in full force and effect and will in no way be affected, impaired or invalidated thereby, so
long as the economic or legal substance of the transactions contemplated hereby is not affected in
any manner materially adverse to any party. Upon any such determination, the parties will
negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to
effect the original intent of the parties.

          (j) All rights, powers and remedies provided under this Agreement or otherwise available in
respect hereof at law or in equity will be cumulative and not alternative, and the exercise of any
thereof by any party will not preclude the simultaneous or later exercise of any other such right,
power or remedy by such party. Without limiting the generality of the foregoing, the rights and
remedies of the parties under this Agreement, and the obligations and liabilities of the parties
under this Agreement, are in addition to their respective rights, remedies, obligations and
liabilities under all applicable Laws.

          (k) This Agreement is the product of negotiation by the parties, which have had the assistance
of counsel and other advisors. The parties intend that this Agreement not be construed more
strictly with regard to one party than with regard to any other party.

          (l) The words “include,” “includes” or “including” as used in this Agreement are to be deemed
followed by the words “without limitation.” The words “herein,” “hereof,” “hereunder” and similar
terms as used in this Agreement are to be deemed to refer to this Agreement as a whole and not to
any specific Section or Article. Whenever the context requires, terms defined in this Agreement in
the singular will be deemed to include the plural and vice versa. The word “extent” in the phrase
“to the extent” as used in this Agreement means the degree to which a subject or other thing
extends and such phrase does not simply mean “if.” No provision of this Agreement is to be
construed to require, directly or indirectly, any Person to take any action, or omit to take any
action, to the extent such action or omission would violate

10

 

applicable Law. In this Agreement, except as the context may otherwise require, references:
(i) to Sections or Articles are to the Sections or Articles of this Agreement; (ii) to any
agreement (including this Agreement), contract, statute or regulation are to the agreement,
contract, statute or regulation as amended, modified, supplemented, restated or replaced from time
to time (in the case of an agreement or contract, to the extent permitted by the terms thereof);
(iii) to any section of any statute or regulation include any successor to that section; and (iv)
to the date of this Agreement is to the date set forth in the Preamble.

[Signatures on following page]

11

 

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the date first
above written.

	 	 	 	 	 	 	 
	 	 	GENERAL DYNAMICS ADVANCED	 	 
	 	 	INFORMATION SYSTEMS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David A. Savner	 	 
	 

	 	Name:
	 	David A. Savner
	 	 
	 

	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	VISION MERGER SUB, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David A. Savner	 	 
	 

	 	Name:
	 	David A. Savner
	 	 
	 

	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	STOCKHOLDERS:	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Stephen W. Bershad	 	 
	 	 	 	 	 
	 	 	Stephen W. Bershad	 	 
	 
	 	 	 	 	 	 
	 	 	SWB HOLDING CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Stephen W. Bershad
 

Stephen W. Bershad
	 	 
	 

	 	Title:
	 	President

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