AGREEMENT

                                                                      EXHIBIT 10


                                    AGREEMENT


     AGREEMENT  made as of this 1st day of August,  2009 by and  between  HERLEY
INDUSTRIES,  INC., a Delaware corporation,  with its principal office located at
101 North Pointe Boulevard,  Lancaster,  Pennsylvania  17601 (the "Company") and
Jeffrey L. Markel,  residing at 38 Oak Hill Drive,  Lititz,  Pennsylvania  17543
("Markel").

     WHEREAS,  the Company and Markel entered into an employment agreement dated
as of May 30, 2007, which,  inter alia,  employed him as Chief Operating Officer
of the Company (the "Employment Agreement"); and

     WHEREAS,  the Board of Directors of the Company,  after  consideration  and
evaluation  of the  Company's  result  of  operations,  on a  Company  wide  and
operating  unit basis,  has  determined  that it is planning to  reorganize  the
Company's management structure; and

     WHEREAS,  a Special Committee of the Board of Directors,  consisting solely
of independent  directors,  has been appointed to evaluate Mr. Markel's existing
Employment Agreement and its proposed termination; and

     WHEREAS,  the Special Committee has retained  independent counsel to assist
in this evaluation; and

     WHEREAS, under the Employment Agreement,  the only basis for termination by
the Company of Markel's employment,  would be "without cause" which would result
in an immediate  lump sum payment to Markel of  $1,531,661  in addition to other
benefits; and

     WHEREAS,  after  negotiations  between  the Special  Committee  and Markel,
Markel has agreed to accept  termination  of the  Employment  Agreement on terms
more beneficial to the Company than otherwise mandated under its terms.

     WHEREAS, this agreement shall be effective at 12:01 A.M. Eastern time as of
August 1, 2009 ("Effective Date").

     NOW,  THEREFORE,  based upon the mutual covenants  contained herein and for
other  good and  valuable  consideration,  the  sufficiency  of which is  hereby
acknowledged, the Company and Markel agree as follows:

     1. In full  satisfaction  of all prior,  current and future  obligations to
Markel under the Employment Agreement or otherwise, whether accrued or otherwise
(except for rights of, or obligations to, Markel or his affiliates in connection
with  his or their  ownership  of the  Company's  equity  securities  "Ownership
Rights") the parties hereby agree as follows:

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     (a) Within five days after  execution  hereof,  Markel shall receive a lump
sum payment in the sum of $1,350,000.

     (b)  Markel  and  his  spouse  shall  continue  to  receive   medical  care
reimbursement, in accordance with the terms of paragraphs 9(b) of the Employment
Agreement.

     (c) Markel  shall  have the use of the  automobile  leased for his  benefit
during his actual  employment  term,  with  payment by Herley of the  automobile
lease  payments and insurance  payments  thereon  until  expiration of the lease
(approximately 11 months).

     (d) All outstanding unvested stock options shall vest immediately.

     2. (a) Markel  covenants,  represents  and agrees  that the  provisions  of
paragraph  12 of the  Employment  Agreement  shall  survive this  agreement  and
continue in full force and effect.

     (b)  Markel  covenants,  represents  and agrees  that  during the period he
receives payments hereunder, including payments under paragraph 2(e) hereof, and
provided the Company is not in breach of this  agreement,  he shall abide by and
fully comply with the  provisions of paragraph 13 of the  Employment  Agreement,
which is hereby modified by deleting subsection (c)(i) thereof.

     (c)   The   provisions   of   Paragraphs   14   (Remedies/Sanctions),    15
(Beneficiaries/References),  17 (Indemnification and Liability Insurance) and 19
(Assignability;  Binding Nature) of the Employment  Agreement shall survive this
agreement and are fully  incorporated by reference herein and made applicable to
the provisions herein.

     (d) The  provisions  of  Paragraph 16 (Taxes) of the  Employment  Agreement
shall survive this agreement and are fully  incorporated by reference herein and
made applicable to all or any portion of the payments to be made to Markel under
this agreement and/or any other payments and benefits that Markel receives or is
entitled to receive from the Company.

     (e) The  provisions  of Section 11  (Consulting  Period) of the  Employment
Agreement (other than Sections 11(a) and 11(c)) shall survive this Agreement and
are fully  incorporated  by  reference  herein  and are made  applicable  to the
provisions  herein except that, (i) the  Consulting  Period shall be a period of
three years  commencing on the Eff