Exhibit 10.4
AMENDMENT TO PARTNERSHIP
AGREEMENT
OF
LAUREL TECHNOLOGIES
PARTNERSHIP
THIS AMENDMENT TO PARTNERSHIP AGREEMENT (“Amendment”)
dated as of August 3, 1999, by and between LAUREL TECHNOLOGIES,
INC., now known as SUNBURST MANAGEMENT, INC., a Pennsylvania
corporation (“Laurel”) and DRS SYSTEMS MANAGEMENT
CORPORATION, a Delaware corporation (“DRS”).
RECITALS
A.
By way of a Partnership Agreement (“Partnership
Agreement”) dated as of December 13, 1993, Laurel and DRS
formed a Partnership for the Business and related activities
necessary and appropriate to effect the Business.
B.
Pursuant to the Partnership Agreement, as of this date the
Partnership Percentage Interest of DRS is 80% and the Partnership
Percentage Interest of Laurel is 20%.
C.
The Partners seek to maximize the use and capacity of their
facilities by undertaking activities and programs the income from
which would not be allocated in accordance with the Partnership
Percentage Interests.
D.
In order to expand their respective opportunities, Laurel and DRS
wish to set forth their respective rights and obligations with
respect to activities that would not be subject to the Partnership
Percentage Interests set forth in the Partnership
Agreement.
NOW, THEREFORE, in consideration of
the mutual covenants set forth herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Laurel and DRS agree as follows:
ARTICLE I
DEFINITIONS
1.1
All capitalized terms not specifically defined in this Amendment
shall have the meanings set forth in the Partnership
Agreement.
1.2
When used in this Amendment, the following terms will have the
meaning set forth below:
(a)
“Allocable Indirect Costs” shall mean (i) unallowable
costs as currently defined by the Federal Acquisition Regulations
and in accordance with the Partnership’s usual methodology
and (ii) inter-company interest (if any). DRS
1
Management Fees, Laurel Management Fees and
royalties are not Allocable Indirect Costs.
(b)
“Cost” shall mean the sum of labor, material and other
costs directly attributable to a program plus overhead and general
and administrative costs allocated to such program in accordance
with the Partnership’s usual methodology which complies with
GAAP and FAR.
(b)
“DRS Affiliate” shall mean (i) any firm, partnership,
corporation, trustee or other entity that directly or indirectly
through one or more intermediaries controls or is controlled by or
is under common control with DRS, excluding, however, the
Partnership or any of its subsidiaries or controlled
entities.
(c)
“DRS Allocated Programs” shall have the meaning set
forth in paragraph 2.1.
(d)
“DRS Requested Programs” shall have the meaning set
forth in paragraph 2.2.
(e)
“Indirect Costs” shall mean unallowable costs, interest
expense (if any), DRS management fees, Laurel management fees,
royalties, and inter-company interest.
(f)
“Net Income” shall mean Operating Income minus Indirect
Costs.
(g)
“New Partnership Program” shall mean any new program
that is acquired through the marketing efforts of the Partnership
or DRS or a DRS Affiliate with the intent that the Partnership
would perform the services.
(h)
“Operating Income” shall mean the revenue from a
program minus Cost associated with such program and minus Allocable
Indirect Costs.
(i)
“Partnership Program” shall mean all production
programs obtained through the marketing efforts of the management
of the Partnership. All non-intercompany production programs
currently being undertaken by the Partnership as of the date of
this Amendment will be considered Partnership Programs.
Examples of such Partnership Programs are set forth in Exhibit
“A”.
ARTICLE
II
PRODUCTION
PROGRAMS
2.1
DRS Allocated Programs
2.1.1
Should DRS desire that the Partnership undertake any new program to
be performed by the Partnership (a) that is obtained solely through
t
