Document:

Exhibit 10.2

 

LEASE AGREEMENT

 

This Lease Agreement (“Lease”) is made and entered into on this 30th day of April, 2015, by and between LK Property Investments, LLC (“Landlord”), and Industrial Services of America, Inc. (“Tenant”).

 

WITNESSETH:

 

1.                                       Premises Leased. The Landlord hereby grants, demises and leases unto Tenant all of the real estate commonly known as 6709 Grade Lane, Louisville, Kentucky and legally described in the attached Exhibit A except that portion currently leased to Jack Cooper Transport Company (“Cooper”) consisting of approximately 2,000 square foot portion of the office space, 9,000 square feet of shop space (first four (4) bays connected to office space), 1,750 square feet of parts room storage and 45,000 square feet of truck parking (the property leased to Tenant hereinafter be known as the “Leased Premises” and the entire parcel and the improvements located thereon to be known as the “Property”).  Tenant agrees to allow Cooper the shared, reasonable use of the restrooms and drivers’ lounge area in the building accessed by the door in the front of the building located on the Property.

 

2.                                      Term. The term of this Lease shall commence as of the date hereof (“Commencement Date”) and shall continue through April 14, 2019 (the “Term”), at which time this Lease will terminate.  However, at any time after giving ninety (90) days written notice,

 

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Tenant may vacate the Leased Premises.  The lease will terminate on the date of vacation.

 

3.                                        Rental. Tenant shall, during the Term of this Lease, pay to Landlord a monthly rental of $3,000.00 in advance.  All monthly rental payments shall be made on or by the first day of each calendar month in advance to the Landlord. The Term and Tenant’s obligation to pay rent and the other costs to be borne by Tenant hereunder shall commence on the Commencement Date. Landlord shall grant possession to Tenant on the Commencement Date. Rental shall be payable without demand, set-off or deduction, except as provided in this Lease.  Rental for partial months at the beginning and end of the Term (or Landlord’s vacancy as provided in this paragraph 3) shall be prorated.

 

4.                                        Title and Enjoyment. Landlord covenants that it has fee simple title to the Leased Premises.  Landlord covenants that the Leased Premises are free and clear of all liens, encumbrances and ground leases, except taxes, assessments, and all matters of record as of the date of this Lease.  Landlord further covenants that Tenant, so long as it is not in default beyond any applicable notice and cure periods, shall, during the term hereby granted, and during any renewals hereof, peaceably and quietly have, hold and enjoy the said Leased Premises for the full term of years in this Lease, subject to easements, restrictions, and other matters of record, including, but not limited to, all zoning regulations. In the event Tenant’s contemplated use of the Premises is materially restricted or prohibited by any laws or regulations, Tenant shall have the option to terminate this Lease.

 

5.                                     Use of Premises. Tenant shall be permitted to use the Leased Premises only for truck and trailer parking, performance of maintenance and repairs on the same, office use and ancillary storage. Tenant covenants and agrees not to use the Leased Premises for any illegal

 

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purpose nor in such manner as to violate any applicable and valid law, rule, or regulation of any kind of any governmental body.

 

6.                                    Other Costs. Tenant shall be solely responsible for the payment of taxes relating to its personal property at the Leased Premises. During the Term of this Lease, Landlord will pay all property and other taxes concerning the Leased Premises. Tenant shall reimburse Landlord for forty percent (40%) of the property taxes assessed against the Property during the Term (prorated for any partial years) within thirty (30) days after receipt from Landlord of copies of such applicable tax bills. Such reimbursed amount shall be considered additional rent hereunder.

 

7.                                      Maintenance by Tenant and Landlord.  Tenant agrees that it will take possession of the Leased Premises in an “as is” and “where is” condition.  Tenant will keep the Leased Premises in good condition and repair at its expense, reasonable wear and tear excepted, and it will indemnify and save harmless Landlord from and against all liens, claims or damages by reason of any repairs or improvements which may be made by or on behalf of Tenant on the Leased Premises. Landlord makes no warranties to Tenant as to the condition of the Leased Premises or the suitability of the Leased Premises for Tenant’s intended use, except that the Leased Premises is properly zoned for Tenant’s intended use. Tenant shall: (a) provide for prompt trash and litter removal, and (b) keep the Leased Premises in their current or better (at Tenant’s option) condition and repair, subject to natural wear, tear and/or deterioration of same. If Tenant fails to perform its obligations hereunder, Landlord may, after first providing Tenant fifteen (15) days prior written notice, but shall not be obligated to, perform Tenant’s obligations or perform work resulting from Tenant’s acts, actions or omissions; and all reasonable amounts so paid or incurred shall, following written notice to Tenant, be considered additional rent payable by Tenant with the next installment of monthly

 

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rent thereafter becoming due and payable. Landlord hereby agrees to keep the structural components (including, without limitation, walls, foundations, roof) of any improvements on the Leased Premises in good condition and repair, to maintain and repair any building systems located outside of any buildings and to maintain any parking lots on the Leased Premises.  Tenant shall be responsible for maintaining compliance of the Leased Premises with the Americans with Disabilities Act, as amended.

 

8.                                Remodeling.  Tenant shall have the right and privilege to make from time to time any non-structural alterations, changes, additions and improvements to the Leased Premises, at its own expense, so long as same shall be done in a good and workmanlike manner, in compliance with all applicable laws, codes, and ordinances. Any and all structural modifications to the Leased Premises shall be subject to the prior written approval of Landlord.  All repairs by Tenant shall be done in good workmanlike manner in compliance with all applicable national, state, and local codes and rules and regulations.

 

9.                               Fixtures, Equipment and Signs.  Tenant may install and operate in and upon the Leased Premises such trade fixtures, equipment, machinery and appliances as it shall consider necessary to the conduct of its business on the Leased Premises. Tenant may at any time remove all or any part of such fixtures, equipment, machinery and appliances installed on the Leased Premises by Tenant; provided, however, Tenant shall promptly repair any damage to the Leased Premises which may be caused by such installation or removal. Tenant shall not place any signs in, on or about the Leased Premises. Landlord hereby acknowledges that it has no contractual liens in Tenant’s personal property. Landlord hereby agrees to subordinate to Tenant’s current and future lender(s), Landlord’s statutory or common law landlord’s lien related to Tenant’s personal property. No further documentation shall be

 

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required to evidence such subordination and this provision shall be self-operative.

 

10.                             Assignment and Subletting. Tenant shall not transfer or assign this Lease or sublet the Leased Premises without the prior written consent of the Landlord; but upon any permitted assignment or sublease, Tenant shall remain liable for all obligations set forth in this Lease unless otherwise provided.

 

11.                                Taxes.  Subject to the provisions of paragraph 6 above, Landlord covenants and agrees to pay each year the annual real property taxes due for the Leased Premises during the Term.

 

12.                                Insurance and Indemnification.  Tenant shall keep in full force and effect a policy of comprehensive general commercial liability insurance on the Leased Premises and the business operated by Tenant upon the Leased Premises, and with limits of liability not less than $1,000,000.00 for personal injury and property damage, per occurrence, and with Landlord named as an additional insured.  The liability insurance policy shall, to the extent possible, contain a clause that the insurer will neither cancel nor change such insurance without first giving fifteen (15) days prior written notice to Landlord; Tenant further agrees to provide the Landlord with certificates of insurance evidencing the issuance of said policies referred to hereinabove.

 

Landlord shall carry commercial general liability insurance insuring all claims, demands or actions made by or on behalf of any person or persons, firm or corporation and arising from, related to or connected with the Property, for bodily injury to or personal injury to or death of any person, or more than one person, or for damage to property in an amount of not less than $2,000,000 combined single limit per occurrence/aggregate.  The insurance shall be

 

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written on an “occurrence” basis and not on a “claims made” basis. If at any time during the term of this Lease, Landlord owns more than one location, the policy shall contain an endorsement to the effect that the aggregate limit in the policy shall apply separately to each location owned by Landlord. Landlord shall insure all improvements at any time situated upon the premises against loss or damage covered by the Standard Fire and Extended Coverage Policy and all other risks of direct physical loss as insured against under Special Form (“all risk” coverage). The insurance coverage shall be for not less than the full replacement cost of the improvements with agreed amount endorsement.  Tenant’s and Landlord’s insurance policies shall each contain an endorsement waiving the insurer’s right of subrogation against the other party.

 

13.                               Destruction of or Damages to Premises; Condemnation.

 

(A)                                If the buildings or improvements comprised of the Leased Premises shall be destroyed or damaged to the extent of fifty percent (50%) or more of its then value above the foundation, then Landlord or Tenant may terminate this Lease by giving the other written notice sixty (60) days from the date of the loss. To the extent Tenant continues to operate for its use from the Leased Property after any destruction or damage thereto, as contemplated in this Section, the monthly rental and other obligations of Tenant hereunder shall not be abated or reduced unless otherwise agreed. Regardless of the extent of the destruction, monthly rental and all other charges hereunder shall abate from the date of casualty until restoration is complete to the extent that Tenant is unable to operate from the Leased Property for the use described herein.

 

(B)                                 In the event the termination pursuant to subsection a. above does not occur, or the casualty or destruction is not substantial enough for the termination rights set forth in subsection a. above to be applicable, Landlord shall rebuild/restore all improvements to the

 

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Leased Premises with due diligence.  Tenant shall have the right to terminate the Lease if the restoration is not completed within one hundred eighty (180) days after the casualty of destruction.

 

(C)                                   If any portion or all of the Leased Premises or access thereto shall be taken for public or quasi-public use by the right of eminent domain, or transferred by agreement in connection with such public or quasi-public use, or condemned, Landlord and Tenant shall each have the option (to be exercised within ninety (90) days of written notice to Tenant of the taking or condemnation) to cancel this Lease as of the effective date of the taking or condemnation.

 

14.                               Utility Bills. Tenant shall pay all utility charges, as further set forth herein, made against the Leased Premises during the Term including, but not limited to, charges for water, sewer, drainage, gas, electricity, telecommunications, and all other utility charges. Because there is only one meter of each utility in the building, this will be accomplished by Tenant paying to Landlord a sum equal to forty percent (40%) of the utility bills incurred for the building as Rent upon presentment by Landlord of copies of applicable bills. Such amounts shall be due within thirty (30) days after invoice.

 

15.                     Remedies.

 

(A)                               Remedies of Landlord In Event of Default By Tenant.  In the event Tenant shall default in the payment of any monthly rental or other charge herein provided for, and such default shall continue for fifteen (15) days after Landlord shall have notified Tenant in writing of the existence of such default (provided, however, that there shall be no right to cure or Notice of Default required if there has been one or more prior defaults in the payment of any monthly rental or other charge during the applicable calendar year period); or the event of default by Tenant in the observance. or performance of any of the other terms, covenants, agreements or

 

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conditions contained in this Lease Agreement for a period of thirty (30) days after written notice from Landlord (or such additional time as is reasonably required to correct any such default, not to exceed sixty (60) days provided the cure is begun within the thirty (30) day period); or if Tenant is adjudicated a bankrupt; or if a permanent receiver is appointed for Tenant’s property, including Tenant’s interest in the Leased Premises, and such receiver is not removed within sixty (60) days after written notice from Landlord to Tenant to obtain such removal; or if, whether voluntarily or involuntarily, Tenant takes advantage of any debtor relief proceeding Under any present or future law hereby the rent, or any part thereof, is, or is proposed to be, reduced or payment thereof deferred; or if the Leased Premises or Tenant’s effects or interest therein should be levied upon or attached under process against Tenant and are not satisfied or dissolved within thirty (30) days after written notice from Landlord to Tenant to obtain satisfaction or dissolution thereof; then, and in any of said events (said events being sometimes referred to as “Events of Default”). Tenant shall be deemed to have breached this Lease Agreement and Landlord shall have the right at its option either to:

 

i.                                          Forthwith cancel and terminate this Lease by notice in writing to Tenant and if such notice shall be given, all rights of Tenant to the use and occupancy of said Leased Premises shall terminate as of the date set forth in such notice, and Tenant will at once surrender possession of the Leased Premises to Landlord and remove all of Tenant’s effects therefrom, and Landlord may forthwith re-enter the Leased Premises and repossess, such Leased Premises. No termination of this Lease prior to the normal expiration thereof shall affect Landlord’s right to collect rent and other charges hereunder for the remainder of the then existing term; or

 

ii.                                       Landlord may take whatever action at law or in equity which may appear necessary or desirable to collect the rent and other amounts then due and thereafter to become due hereunder or to enforce performance and observance of any obligation, agreement or

 

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covenant of Tenant under this Lease, and in connection with such actions, to recover any or all direct damages to Landlord for Tenant’s violation or breach of this Lease.

 

(B)                               Remedies of Tenant In Event of Default By Landlord. Landlord shall in no event be charged with default in the performance of its obligations under this Lease, unless and until Landlord shall have received written notice from Tenant specifying wherein Landlord has failed to perform any obligation hereunder, and Landlord shall have failed to perform such obligation, or remedy such default, within thirty (30) days (or such additional time as is reasonably required to correct any such default, not to exceed sixty (60) days provided the cure is begun within the thirty (30) day period) after Landlord’s receipt of such written notice from Tenant.  Subject to the foregoing, in the event of a default by Landlord inobservance or performance of any terms, covenants, agreements or other conditions contained in this Lease Agreement, then Landlord shall be deemed to have breached this Lease Agreement, and Tenant shall have the right at its option either to:

 

i.                                          Forthwith cancel and terminate this Lease by notice in writing to Landlord, and if such notice shall be given, Tenant shall have sixty (60) days to remove its personal property and effects therefrom and to seek any direct manages from Landlord arising from Landlord’s default;

 

ii                                          Tenant shall have the right to expend such funds as are reasonably necessary to cure any failure of the Landlord and make repairs or any other obligations of Landlord, and to recover same by set off against future rent, and to otherwise seek any rights it may have at law or in equity as a result of Landlord’s default.

 

16.                                 Surrender of Possession. Tenant will surrender possession of the Leased

 

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Premises to Landlord at the expiration or any prior termination of the Term of this Lease. Holding over or failure by Tenant to surrender the Leased Premises and any holding over by Tenant shall not operate, except by express mutual agreement between the parties hereto, to extend or renew this Lease, and in the absence of such agreement, either party may thereafter terminate such occupancy at the end of any calendar month by first giving to the other party at least thirty (30) days’ notice in writing of the intention to so terminate.

 

17.                                 Notices and Payments. Notices required to be given hereunder shall be given via email and in writing by overnight courier. Such notices when given by Landlord to Tenant shall be addressed to Tenant at:

 

Industrial Services of America, Inc.

7100 Grade Lane

Louisville, Kentucky 40213

Attn: Sean Garber

Email: sgarber@algaric.com

 

Such notices by Tenant shall be addressed to Landlord at:

 

LK Property Investments, LLC

295 S. Commerce Drive

Waterloo, Indiana 46793

Attn:   Daniel M. Rifkin

Email: drifkin@metalx.net

 

With Copy to:

 

Barrett & McNagny, LLP

215 E. Berry St.

Fort Wayne, IN 46802

Attn:   Ronald J. Ehinger

Email: rje@barrettlaw.com

 

Either party may by written notice to the other party change the address to which notices directed to such party shall be mailed. Rental payments shall be made payable to Landlord at the same address as stated above until Landlord notifies Tenant in writing to make rental payments

 

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to another party or by different means.

 

18.                               Liability of Tenant. Tenant shall protect, indemnify, defend, and hold Landlord harmless from and against all and any liability and expense of any kind, including reasonable attorneys’ fees, arising from injuries or damage to persons or property (i) in or on the Leased Premises during the Term of this Lease should any such injuries or damage be the result of Tenant’s acts or omissions and not Landlord’s acts or omissions, (ii) any negligence or willful misconduct of Tenant, its employees, agents or contractors, and (iii) any default of Tenant under this Lease.

 

19.                               Attorney’s Fees and Expenses. In the event either party shall be required to engage legal counsel for the enforcement of any of the terms of this Lease, whether such employment shall require institution of suit or other legal services required to secure compliance on the part of the defaulting party, the defaulting party shall be responsible for and shall promptly pay to the non-defaulting party the reasonable value of said attorneys’ fees, and any other expenses incurred by the non-defaulting party as a result of such default.

 

20.                                     Subordination and Non-Disturbance. Tenant hereby subordinates all of its right, title and interest in and under this Lease to the lien of any first mortgage, or the lien resulting from any other method of financing or refinancing, now or hereafter inforce against the real estate of which the Leased Premises are apart. It is a condition, however, to the subordination provisions of this paragraph that Landlord shall procure from its mortgagee an agreement in writing, which shall be delivered to Tenant, providing, in substance, that so long as Tenant shall faithfully discharge the obligations on its part to be kept and performed under the terms of this Lease, its tenancy will not be disturbed, nor its lease affected by any default under such mortgage, or mortgages, and the rights of Tenant hereunder shall expressly survive

 

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and shall not be cut-off, and this Lease shall in all respects, continue in full force and effect.

 

21.                               No Presumption Against Drafter.   Landlord and Tenant understand, agree and acknowledge that this Lease has been freely negotiated by both parties, and in any controversy, dispute or contest over the meaning, interpretation, validity or enforceability of this Lease or any of its terms or conditions, there shall be no inference, presumption or conclusion drawn whatsoever against either party by virtue of that party having drafted this Lease or any portion thereof.

 

22.                               Choice of Law and Venue.  The laws of the Commonwealth of Kentucky shall govern the validity, enforceability, and performance of this Lease.  The invalidity or unenforceability of any provision hereof shall not affect or impair any other provision.  The parties agree that any dispute concerning this Lease shall be submitted to and resolved by a court of law located in Jefferson County, Kentucky.

 

23.                               Binding The Parties, etc. The respective rights and obligations provided this Lease shall bind and shall inure to the benefit of the parties hereto, their legal representatives, heirs, successors and assigns, provided, however, that no rights shall inure to the benefit of any successor of Tenant unless Landlord’s written consent for the transfer to such successor has first been obtained as provided in Paragraph 10.  Time is of the essence with respect to all aspects of this Lease.

 

24.                               Counterparts.  This Lease may be executed in two or more counterparts. Execution of any copy shall be deemed to be execution of the original document and all such executed copies and the original shall be read together and treated as one and the same instrument, with the same legal effect as if all persons or corporate and other entities who signed the original or any copy had simultaneously signed the original.

 

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25.                               Environmental.  Tenant agrees to indemnify and hold harmless Landlord from any and all claims, charges, damages) fines, judgments, penalties, costs, liabilities, or losses (including, without limitation, any and all sums paid for settlement of claims and attorney, consultant and expert fees) arising out of, based on or in connection with the presence of any hazardous substances on the Leased Premises or violation of any federal, state, or local environmental laws, regulations, and requirements related to the same, unless the hazardous substances are present due to Landlord’s and/or Coopers or their agents’ or employees’ actions.

 

26.                               Brokers. Landlord hereby warrants that it has not dealt with any broker in connection with this Lease and hereby agrees to indemnify Tenant in the event a broker asserts that it has represented Landlord with respect to this Lease.

 

27.                               Waiver of Damages. Notwithstanding anything to the contrary set forth in this Lease, Landlord and Tenant hereby waive and release the other from liability for any damages which are special, punitive, or consequential (including without limitation damages for lost profits and lost opportunities).  For purposes of this waiver, Landlord’s lost rents shall not be considered special or consequential damages

 

28.                               Force Majeure. In the event that either party hereto shall be delayed or hindered in or prevented from the performance of any act required hereunder by reason of strikes, lockouts, labor troubles, inability to procure materials, failure of power, restrictive governmental laws or regulations, riots, civil disturbances, picketing, demonstrations, insurrection, war or other reasons of a like nature not the fault of the party delayed in performing work or doing acts required under the terms of this Lease, then performance of such act shall be excused for the period of the delay and the period equivalent to the period of such delay. The provisions of this section shall not operate to excuse Tenant from prompt payment of rental, additional rental, or

 

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any other payments required by the terms of this Lease.

 

29.                               WAIVER OF JURY TRIAL. Tenant and Landlord hereby waive trial by jury in any action or proceeding arising out of or in any way relating to the performance or non performance of this Lease by either party other than claims by third parties for personal injury or property damage.

 

IN WITNESS WHEREOF, the parties have caused this instrument to be executed by the persons thereunto duly authorized, the date and year first above written.

 

	
 
    	
Landlord:
    
	
 
    	
LK   Property Investments, LLC, a                  limited liability company
    
	
 
    	
By:
    	
/s/_   Daniel M. Rifkin
    
	
 
    	
 
    	
Daniel   M. Rifkin, President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
WITNESS:
    
	
 
    	
 
    
	
 
    	
Print   Name:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Tenant
    
	
 
    	
Industrial   Services of America, Inc., a Florida corporation
    
	
 
    	
By:
    	
/s/_   Sean Garber
    
	
 
    	
 
    	
Sean   Garber, President
    
	
 
    	
 
    
	
 
    	
WITNESS:
    
	
 
    	
/s/   Tracey Thompson-Taylor
    
	
 
    	
Print   Name:
    	
Tracey   Thompson-Taylor
    
					

 

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EXHIBIT A

 

Leased Premises and Property

 

See Exhibit 10.2EX-10.E

 EXHIBIT 10(e) 

 

			
	

	 	HARRIS CORPORATION
	March 6, 2015	 	1025 West NASA Boulevard
		 	Melbourne, FL USA 32919
	 Todd Taylor
 3828 Grassmere
Road
 Naperville, IL 60564
	 	 phone 1-321-727-9100
  

www.harris.com

		
	Re: Offer of Employment	 	

 Dear Todd: 

Congratulations! I am pleased to extend you an offer of employment with Harris Corporation (“Harris” or “Company”) in the position of
Vice President, Principal Accounting Officer, reporting to Mick Lopez, Senior Vice President and Chief Financial Officer. This is an executive-level position based in Melbourne, FL. Your start date will be April 13, 2015 or such other date
mutually agreed by you and the Company. 
 Todd, we believe you will make an outstanding contribution to the Harris organization, and as such,
we have crafted a total rewards package for you, consistent with Harris executive compensation program design. The elements of this package include: 
  

	 	1)	An annual base salary of $275,000 payable bi-weekly. Base salaries are reviewed annually, with adjustments, if any, made (generally effective in September) subject to
both business and personal performance. 

  

	 	2)	Your participation in the Harris Annual Incentive Plan (“AIP”). Your FY15 target opportunity will be 60% of base salary. Incentive awards are paid based on
the achievement of pre-established, annual business operating metrics and the successful completion of personal performance objectives set during the annual performance management cycle. Incentive awards may range from 0% to 200% of target based on
business and personal performance. Your participation in AIP will begin on your start date and be pro-rated based on time in position during FY15. To the extent earned, payouts are made in September following the fiscal year end, net of applicable
withholdings and deductions. 

  

	 	3)	Eligibility to accept annual equity awards granted by Harris Corporation under the Harris Corporation 2005 Equity Incentive Plan or its successor (the
“Plan”), with a target value of $180,000. These awards are typically delivered in the form of stock options and performance share units and are granted in late August following Management Development and Compensation Committee of the Board
of Directors approval of annual equity awards to other Harris executives. You will be eligible for these grants commencing with the FY16 grant cycle in August 2015. Once approved, the awards are subject to the applicable terms and conditions in
effect at the time of the grant. Annual equity grants are performance based and the amount awarded may vary. 

  

	 	4)	A one-time Restricted Stock Award (RSA) of 3,500 RSA’s with an approximate grant value of $250,000 to offset foregone long term incentives from your current
employer and as an incentive to join Harris. This award will be granted on the first New York Stock Exchange trading day during the month following your start date (if that trading 

  
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day occurs within a Quiet Period as defined by Harris’ equity grant policy, the grant date will be the first trading day following the end of the Quiet Period). Assuming continued employment
with the company, this award will vest in its entirety upon the third anniversary of the grant date. 

  

	 	5)	A one-time sign-on bonus of $50,000 less applicable taxes and other withholdings, payable within forty-five (45) days of hire to offset your current
employer’s forgone annual incentive and as an incentive to join Harris. Should you voluntarily terminate your employment with Harris within twenty-four (24) months of hire, you will be required to repay this bonus.

  

	 	6)	Eligibility to participate in the Harris Corporation Retirement Plan 401(k) with a company match equivalent to 100% of the first 6% of employee contributions. While you
will be immediately eligible to participate in the plan up to individual plan contribution limits, company match contributions will only be made after one year of service. 

 

	 	7)	Eligibility to participate in the Harris Corporation Supplemental Executive Retirement Plan (“SERP”) during the next annual open enrollment period. This IRS
non-qualified retirement plan preserves your ability to make pre-tax contributions, and receive employer match contributions (after one year of service) above the qualified IRS limits and in accordance with the plan terms. 

 

	 	8)	Eligibility to participate in the Harris Performance Reward Plan (“PRP”) with a target of 2% of total cash compensation after one year of service. PRP awards
are paid based on the achievement of pre-established, annual business operating metrics, and may range from 0% to 200% of target. Eligibility is subject to the PRP continuing to be made available to employees. 

 

	 	9)	Eligibility to participate in Harris health and welfare benefit plans, including qualified dependents as applicable. These plans include medical, prescription, dental,
vision, life and short and long-term disability benefits. Coverage under these programs is effective, should you choose to participate, as soon as day one of employment with Harris Corporation. 

 

	 	10)	One hundred twenty (120) hours of vacation annually under the Harris Paid Time Off Program. 

 

	 	11)	Relocation benefits to assist with your move from Naperville, IL to the Melbourne, FL area. Benefits will include, but not be limited to home sale assistance; home
purchase assistance; three months of temporary living accommodations; the packing and shipment of household goods; and a disruption bonus equivalent to one month of base salary less applicable taxes and other withholdings. Additional details
regarding your relocation benefits will be provided under separate cover. 

 In the event that your employment terminates within
24 months following your start date and the termination is a Qualifying Termination, the Company will provide you with a cash severance amount equal to the aggregate of your then current base salary and annual cash incentive compensation. For this
purpose, “annual cash incentive compensation” means your then current target incentive compensation under the AIP (or any successor thereto). Payment of this severance is conditioned on you executing a release of all claims against Harris
and its affiliates in a form satisfactory to Harris within 45 days following your 

  
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separation and not revoking such release. This severance amount will be subject to appropriate withholdings and deductions. This severance amount will be paid to you in a lump sum within sixty
(60) days following your separation from service; provided, however, that if such sixty (60) day payment period begins in one calendar year and ends in a second calendar year, then payment shall occur in the second calendar year.
After the expiration of 24 months following your start date, your separation/severance pay eligibility will be solely pursuant to Harris’ Severance Pay Plan and/or any Executive Change in Control Severance Agreement (“CIC Severance
Agreement”) applicable to you. 
 For purposes of this offer letter, a “Qualifying Termination” is (a) a termination of
employment by you for Constructive Termination or (b) an involuntary termination of your employment by the Company other than for Cause. 

For purposes of this offer letter, “Cause” shall mean: 
  

	 	(i)	a willful breach or failure to satisfy any material provision or condition of this offer letter or your Employee Agreement, including without limitation, those set
forth below; 

  

	 	(ii)	your willful and intentional substantial and continuing failure or refusal to perform your material duties as Vice President, Principal Accounting Officer or to perform
specific directives of the Board or of the officer to whom you report that are consistent with your position; 

  

	 	(iii)	any failure by you to devote your full working time to the Company or any unexcused, repeated or prolonged absence from work by you (other than as a result of, or in
connection with, sickness, injury or disability) during a period of ninety (90) consecutive days; 

  

	 	(iv)	any reckless or willful misconduct (including action or failures to act) by you that causes material harm to the business or reputation of the Company or its
subsidiaries; 

  

	 	(v)	any willful or reckless breach of a statutory or common law duty of loyalty to the Company or its subsidiaries; 

 

	 	(vi)	any act of fraud, dishonesty, embezzlement, theft or unethical business conduct by you in connection with your duties or in the course of your employment, or your
admission or conviction of a felony or of any crime involving moral turpitude, fraud, dishonesty, embezzlement, theft or misrepresentation; 

  

	 	(vii)	your willful violation of a material Company policy that is generally applicable to all employees or all officers of the Company (including the Company’s Code of
Conduct); or 

  

	 	(viii)	a failure by you to cooperate in an internal Company investigation after being instructed by the Board or the officer to whom you report to cooperate.

  
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 For purposes of this offer letter, a “Constructive Termination” shall be deemed to occur upon the
occurrence, without your consent of any of the following: 
  

	 	(i)	a materially adverse diminution of your employment duties (a change in your reporting structure or a change in your title shall not, itself, constitute a diminution of
duties); 

  

	 	(ii)	the assignment to you of duties or responsibilities which are materially inconsistent with your position; 

 

	 	(iii)	a material reduction in your base salary or target AlP, other than any reduction that is also applicable in a substantially similar manner and proportion to the other
senior executives of the Company. 

 provided, however, that the events described in
(i)-(iv) above shall constitute a Constructive Termination only if the Company fails to cure such event within thirty (30) days after receipt from you of a written notice of the event which constitutes a Constructive Termination; and
provided, further, that a “Constructive Termination” shall cease to exist for an event or circumstance on the ninetieth (90th) day following the later of its occurrence or your knowledge thereof, unless you have given the Company written
notice thereof. 
 On or as soon as administratively practicable after the date you are elected as a corporate officer of Harris, you will be
entitled to enter into a CIC Severance Agreement with Harris in the form filed by the Company as Exhibit (10)(o) to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ending October 1, 2010. The multiplier used in
Section 3(a)(2) of the CIC Severance Agreement to determine your lump sum severance amount pursuant to such clause shall be two (2). In the event of a change in control of Harris Corporation (as defined in the CIC Severance Agreement), you
shall be entitled to the compensation and benefits and other rights provided under the CIC Severance Agreement if your employment terminates under the circumstances provided under the CIC Severance Agreement, provided, however, such
compensation and benefits shall be in lieu of any compensation or benefits that may be receivable by you under this offer letter or under the Harris Severance Pay Plan. 
 Payments and benefits under this offer letter are intended to be exempt from or to meet the requirements of Section 409A of the Internal Revenue Code (“Code Section 409A”), and shall
be interpreted and construed consistent with that intent. Notwithstanding any other provision of this offer letter, to the extent that the right to any payment (including the provision of benefits) hereunder as a result of your separation from
service provides for the “deferral of compensation” within the meaning of Code Section 409A and you are a “Specified Employee” under the Harris Corporation Specified Employee Policy for 409A Arrangements as of the date of
your separation from service, then no such payment shall be made or commence during the period beginning on the date of your separation from service and ending on the date that is six months following the date of your separation from service or, if
earlier, on the date of your death, if the earlier making of such payment would result in tax penalties being imposed on you under Code Section 409A. The amount of any payment that otherwise would be paid to you hereunder during this period
shall instead be paid to you on the first business day coincident with or next following the date that is six months and one day following the date of your separation from service or, if earlier, within ninety (90) days following your death.
Each payment of compensation under this offer letter shall be treated as a separate payment of compensation for purposes of Code Section 409A, including without limitation for the purpose of applying the exclusion from Code Section 409A
for certain short-term deferral amounts. 

  
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 Conditional Offer. You understand and agree that this employment offer is conditional and expressly subject
to your complying with the following pre-conditions of employment: 
  

	 	a.	You complete your relocation to the Melbourne, FL area within twelve (12) months of your start date. 

 

	 	b.	You accurately complete Harris’ Disclosure of Potential Employment Conflicts form and fully disclosed, and provided copies where applicable, of any written or
other agreements or understandings to which you are a party that relate to the protection of confidential, trade secret or proprietary information; non-competition restrictions; non-solicitation or no-hire prohibitions (employees or customers);
and/or ownership of invention provisions. You affirm that your employment with Harris will not violate any such agreements or understandings. 

  

	 	c.	You pass a drug test prior to commencing employment. A failed drug test will cause you to be ineligible for hire by Harris for at least twelve months.

  

	 	d.	You undergo background and reference checks with results that are satisfactory to Harris. 

 

	 	e.	You execute Harris’ standard Employee Agreement prior to your start date. 

 

	 	f.	You execute and timely return all forms and other documents required for Harris to complete the employment process, including the acknowledgment and acceptance below.

 This offer letter shall be governed by and construed in accordance with the laws of the State of Florida. 

I look forward to you joining the Harris team, and am confident that you will make many significant contributions to the organization. Should you accept
the terms of this offer, please sign and date below, and fax a copy of this letter to me at 321-726-3301 or send it via email at rduffy@harris.com. We would ask that you bring the original signed version with you on your first day of work.

 Sincerely, 
 /s/ Robert L. Duffy

 Robert L. Duffy 
 Senior Vice
President, Human Resources & Administration 
 Harris Corporation 

  
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 ACKNOWLEDGEMENT & ACCEPTANCE 

I understand that this conditional offer letter constitutes the full, complete, and final agreement between Harris and me regarding the initial terms of
my employment. I also understand that my employment with Harris is at-will and that this conditional offer does not constitute a fixed term contract of employment or a guarantee of continued employment for any period. My signature below confirms
that I accept the terms and conditions of this employment offer. 
 Accepted and Agreed, 

 

							
		 		 		 	
				
	/s/ Todd Taylor	 		 	Date:	 	03/20/2015
	Signature: Todd Taylor	 		 		 	

  
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