SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: October 12, 2006
(Date of earliest event reported)
HERLEY INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-5411 23-2413500
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
101 North Pointe Boulevard, Lancaster, Pennsylvania 17601-4133
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code (717) 735-8117
____________________________________________________
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b)
[ ] Pre-commencement communications pursuant to Rule 13e-4c under the Exchange
Act (17 CFR 240.13e-4c)
Item 1.01 Entry into a Material Definitive Agreement
(a) On October 12, 2006, the Company entered into an Administrative
Agreement with The OGC Acquisition Integrity Office, Department of Navy. With
this agreement, the suspension preventing new contract awards at manufacturing
locations in Lancaster, Pennsylvania, Woburn, Massachusetts and Farmingdale, New
York since June 8, 2006, has been lifted, and the Company is now able to resume
its normal business dealings with both the Department of Defense and prime
contractor customers. The Administrative Agreement provides, among other things,
for the Company to fully implement its compliance program and requires that the
Company disassociate itself from its former Chairman, Lee N. Blatt except as may
be required to fulfill the terms of its 2003 indemnification agreement with Mr.
Blatt and the 2006 agreement with Mr. Blatt terminating his employment.
Item 1.02 Termination of a Material Definitive Agreement
Effective October 12, 2006, Lee N. Blatt, co-founder and former Chairman of
the Company, left the Company after 41 years of service. The Company and Mr.
Blatt entered into an agreement terminating his employment agreement and ending
his employee relationship with the Company. The agreement provides that in full
satisfaction of all prior, current and future obligations to Mr. Blatt under the
employment agreement or otherwise, Mr. Blatt is to receive a lump sum payment in
the sum of $3 million, and thereafter the monthly sum of $100,000 commencing on
January 1, 2007, and continuing thereafter on the first day of each month for
sixty-four (64) consecutive months through April 1, 2012 and the sum of $61,528
on May 1, 2012. Payments are through a non-interest bearing promissory note. Mr.
Blatt also is to receive his annual bonus for fiscal 2006 and certain additional
benefits under the agreement, including medical reimbursement and insurance.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
10.1 Administrative Agreement between the Department of the Navy, on behalf
of the Department of Defense, and Herley Industries, Inc.
10.2 Agreement between Herley Industries, Inc. and Lee N. Blatt effective
October 12, 2006.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
HERLEY INDUSTRIES, INC.
By: /s/ John M. Kelley
-----------------------
John M. Kelley
President
Dated: October 13, 2006