EMPLOYMENT AGREEMENT

LMI AEROSPACE, INC. , a Missouri corporation (the “Corporation”), and JAMES McQUEENEY  (“Employee”) hereby agree as follows:

1.       Employment.   The Corporation hereby employs Employee, and Employee accepts employment from the Corporation, upon the terms and conditions hereinafter set forth in this Employment Agreement (“Agreement”).

2.       Term of Employment.  

(A)      The initial term of Employee’s employment under this Agreement shall commence on July 6, 2009 (the “Commencement Date”) and shall terminate on January 1, 2011; provided, however, that this Agreement shall automatically extend for successive one-year terms unless not later than October 31 of any year beginning in 2010, either party has given written notice to the other party of its or his intention not to extend the term of this Agreement (in which case, this Agreement shall terminate at the end of the then-current term); and provided, further, that the term of employment may be terminated upon the earlier occurrence of any of the following events:

(1)      Upon the termination of the business or corporate existence of the Corporation;

(2)      At the Corporation’s option, in the event the Corporation determines that Employee is not performing the duties required of him hereunder to the satisfaction of the Corporation;

(3)      Upon the death of Employee;

(4)      At the Corporation’s option, if Employee shall suffer a permanent disability.  For the purposes of this Agreement, “permanent disability” means any physical or mental impairment that renders Employee unable for a period of six (6) months or more to perform the essential job functions of his position, even with reasonable accommodation, as determined by a physician selected by the Corporation.  Employee acknowledges and agrees that he shall voluntarily submit to a medical and/or psychological examination for the purpose of determining his continued fitness to perform the essential functions of his position whenever requested to do so by the Corporation.  If the Corporation elects to terminate the employment relationship under this subparagraph (4), the Corporation shall notify Employee or his representative in writing, and the termination shall become effective on the date that such notification is given;

(5)      At the Corporation’s option, upon ten (10) calendar days’ written notice to Employee, in the event of any breach or default by Employee of any of the terms of this Agreement or of any of Employee’s duties or obligations hereunder.  In lieu of providing ten (10) calendar days’ advance written notice, the Corporation, at its sole option, may terminate Employee’s services immediately and pay him an amount that is equivalent to ten (10) calendar days of his salary, less any deductions required by law;

(6)      At the Corporation’s option, without any advance notice, in the event that Employee engages in conduct that, in the opinion of the Corporation, (1) constitutes dishonesty of any kind (including, but not limited to, any misrepresentation of facts or falsification of records) in Employee’s relations, interactions or dealings with the Corporation or its customers; (2) constitutes a felony; (3) potentially may or will expose the Corporation to public disrepute or disgrace, or potentially may or will cause harm to the customer relations, operations or business prospects of the Corporation; (4) constitutes harassment or discrimination towards any person associated with the Corporation, whether an employee, agent or customer, based upon that person’s race, color, national origin, sex, age, disability, religion or other protected status; (5) reflects disruptive or disorderly conduct, including but not limited to, acts of violence, fighting, intimidation or threats of violence against any person associated with the Corporation, whether an employee, agent or customer, or possessing a weapon while on the Corporation’s premises or while acting on behalf of the Corporation; (6) is indicative of abusive or illegal drug use while on the Corporation’s premises or while acting on the Corporation’s behalf; or (7) constitutes a willful violation of any governmental rules or regulations; or

(7)      At the Employee’s option, after providing the Corporation with at least thirty (30) calendar days advance written notice of his intention to terminate the employment relationship.

If employment is terminated for any of the reasons set forth in subparagraphs (3) through (7) of this section 2(A), Employee shall be entitled to receive only the Base Salary (as that term is hereinafter defined) accrued but unpaid as of the date of the termination and shall be ineligible to receive any additional compensation or severance pay.  If, on the other hand, employment is terminated by the Corporation during the term of this Agreement for any reason other than those set forth in paragraphs (3) through (7) of this section 2(A), subject to the conditions set forth in paragraphs 2(C) and (D) of this Agreement, the Corporation shall provide severance pay to Employee in an amount based upon his length of service with the Corporation.  Specifically, the Corporation shall provide Employee with six (6) months of Base Salary if he has less than five (5) years of service with the Corporation as of the date of his termination and with twelve (12) months of Base Salary if he has five (5) or more years of service with the Corporation as of the date of his termination.  Such severance pay shall be paid in equal monthly installments commencing immediately after the termination.  Notwithstanding the foregoing, if at the time of Employee’s termination, Employee is considered a ‘specified employee’ within the meaning of Section 409A(a)(2) of the Code, and if any payment that Employee becomes entitled to under this Agreement would be considered deferred compensation subject to Section 409A of the Code, then no such payment shall be payable prior to the date that is the earlier of (1) six months and one day after Employee’s termination, or (2) Employee’s death, and the initial payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for application of this provision.

(B)      If Employee’s employment with the Corporation is terminated in conjunction with a change in the control of the Corporation or in conjunction with the sale of substantially all of the operating assets of the Corporation, the Corporation will provide Employee with severance pay under the circumstances specified in subparagraphs (1) or (2) of this section 2(B) as the case may be, and the conditions set forth in paragraphs 2(C) and (D) of this Agreement.  For the purposes of this Agreement, a “change in control” is defined as the sale of substantially all of the operating assets of the Corporation or the acquisition of more than fifty percent (50%) of the stock of the Corporation by a group of shareholders or an entity that acquires control of the Corporation (a “Purchaser”).

(1)      If the change in control or the sale results in the involuntary termination of Employee or results in Employee electing to terminate his employment for a good reason as determined by the Corporation in its sole discretion (such as the Purchaser refusing to offer full time employment to Employee on terms comparable to those provided by the Corporation prior to the acquisition or the Purchaser requiring Employee to move to a new location), the Corporation shall provide Employee with severance pay in an amount that is equal to two times his annual Base Salary and shall pay Employee any reasonably anticipated Performance Bonus for the fiscal year in which he was terminated, on a prorated basis.

(2)      If Employee voluntarily terminates his employment without a good reason (as determined by the Corporation in its sole discretion) within ninety (90) days after the change in control or the sale, the Corporation shall provide Employee with six (6) months of Base Salary if he has less than five (5) years of service with the Corporation as of the date of his termination and with twelve (12) months of Base Salary if he has five (5) or more years of service with the Corporation as of the date of his termination.

(C)      The severance pay provided for in section 2(A) and 2(B) of this Agreement shall be paid in equal monthly installments commencing immediately after the termination.  Notwithstanding the foregoing, if at the time of Employee’s termination, Employee is considered a ‘specified employee’ within the meaning of Section 409A(a)(2) of the Code, and if any payment that Employee becomes entitled to under this Agreement would be considered deferred compensation subject to Section 409A of the Code, then no such payment shall be payable prior to the date that is earlier of (1) six months and one day after Employee’s termination, or (2) Employee’s death, and the initial payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for application of this provision.

(D)      Notwithstanding anything to the contrary, (i) the amount of severance pay provided under this Agreement shall not under any circumstances exceed the limitations set forth in § 280G of the Code, and (ii) the Corporation’s obligation to pay the severance pay provided for in this section 2 shall be conditioned on Employee’s execution of a written waiver and release agreement satisfactory to the Corporation.

3.       Compensation.

(A)      During the period from the Commencement Date to December 31, 2009, the Corporation shall compensate Employee for Employee’s services rendered hereunder by paying to Employee an annual salary (the “Base Salary”) of Three Hundred Thousand Dollars ($300,000.00), prorated for the months employed in 2009.  During the period from January 1, 2010 to December 31, 2010, Employee’s Base Salary shall be Three Hundred Nine Thousand Dollars ($309,000.00).  Thereafter, as long as this Agreement remains in effect, the annual Base Salary that the Corporation shall pay to Employee for his services rendered hereunder will be Three Hundred Nine Thousand Dollars ($309,000.00), prorated for any year in which Employee is not employed for the entire year.  Payment of this salary will be made in accordance with the payroll policies of the Corporation in effect from time to time.  Notwithstanding anything in this paragraph to the contrary, the Corporation reserves the right to deduct or withhold all amounts from Employee’s salary as may be required by law or otherwise mutually agreed to by the parties hereto.

(B)      With respect to each fiscal year of the Corporation during which (i) the Employee is employed under the terms of this Agreement as of the first day of the next fiscal year, and (ii) the Corporation's “Annual Income from Operations” (as that term is hereinafter defined) is at least 60.00% of budgeted Annual Income from Operations, the Corporation shall pay to Employee, in addition to the Base Salary, an annual “Performance Bonus”.

The amount of the annual Performance Bonus (if any) shall be equal to:

The Compensation Committee of the Board of Directors of the Corporation (the “Compensation Committee”) retains the right to modify or adjust the manner in which the Performance Bonus is calculated in the event that the Corporation either acquires the assets of another entity, or any portion thereof, or sells its assets, or any portion thereof, to another entity.

In the event the Corporation’s Annual Income from Operations for any given fiscal year is less than 60.00% of budgeted Annual Income from Operations, Employee shall not be entitled to a Performance Bonus with respect to such fiscal year.

For purposes of the calculation of the Performance Bonus, the Corporatio