LMI AEROSPACE INC
EX. 10.29 - EMPLOYMENT AGREEMENT - GRAH
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>7
<FILENAME>lmiex1028032902.txt
<DESCRIPTION>EX. 10.29 - EMPLOYMENT AGREEMENT - GRAH
<TEXT>
                                                                  Exhibit 10.29

                              EMPLOYMENT AGREEMENT


         LMI AEROSPACE,  INC., a Missouri corporation (the  "Corporation"),  and
Robert T. Grah ("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. Any and all employment agreements heretofore entered into
between the  Corporation and Employee are hereby  terminated and cancelled,  and
each of the parties hereto  mutually  releases and discharges the other from any
and all  obligations  and  liabilities  heretofore  or now existing  under or by
virtue of any such employment agreements,  it being the intention of the parties
hereto that this  Agreement,  effective  immediately,  shall supersede and be in
lieu of any and all prior employment agreements between them.

         2. Term of Employment.  The initial term of Employee's employment under
this Agreement shall commence on January 1, 2002 and shall terminate on December
31, 2003; provided, however, that this Agreement shall be automatically extended
for  additional  terms of one year each unless not later than  October 31 of any
year beginning in 2003, either party has given written notice to the other party
of its or his intention not to extend the term of this Agreement;  and provided,
further,  that  the  term of  employment  may be  terminated  upon  the  earlier
occurrence of any of the following events:

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

               (b) 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;

               (c) Upon the death of the Employee;

               (d) 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 the
         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.  The  Employee  acknowledges  and  agrees  that  he  shall
         voluntarily  submit to a medical 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 on this basis,  the Corporation  shall notify the Employee
         or his  representative  in writing  and the  termination  shall  become
         effective on the date that such notification is given;

               (e) 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 the  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;

               (f) At the Corporation's  option,  without any advance notice, in
         the event that the Employee engages in conduct which, 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

               (g) 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
         paragraphs (c) through (g) of this section,  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  (c)  through (g) of this  section,  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,  unless  the  Corporation,  within  its sole  discretion,
         elects  to pay the  present  value of the  severance  pay in a lump sum
         within thirty (30) calendar days of the termination.

               Notwithstanding anything to the contrary, the amount of severance
         pay provided  under this  Agreement  shall not under any  circumstances
         exceed the  limitations  set forth in ss. 280G of the Internal  Revenue
         Code of 1986.

         3. Compensation.

               (A) During the period from  January 1, 2002 to December 31, 2002,
the  Corporation  shall  compensate  Employee for Employee's  services  rendered
hereunder  by paying to  Employee an annual  salary  (the "Base  Salary") of One
Hundred Forty Thousand  Dollars  ($140,000.00),  less any authorized or required
payroll deductions. Thereafter, as long as this Agreement remains in effect, the
annual  Base  Salary  that the  Corporation  shall pay to the  Employee  for his
services rendered will be One Hundred Forty-Five Thousand Dollars ($145,000.00),
less any authorized or required payroll deductions.  Payment of this salary will
be made in accordance  with the payroll  policies of the  Corporation  in effect
from time to time.

               (B) With respect to each complete  fiscal year of the Corporation
during which (i) the Employee is employed  under the terms of this  Agreement as
of the last day of such  fiscal  year,  and (ii) the  Corporation's  "Annual Net
Income" (as that term is hereinafter  defined) is more than Two Million  Dollars
($2,000,000.00),  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:

         (1)   one percent (1.0%) of the Corporation's Annual Net Income that is
               between Two Million  Dollars  ($2,000,000.00)  and Four  Million,
               Four  Hundred  Ninety-Nine  Thousand,  Nine  Hundred  Ninety-Nine
               Dollars and Ninety-Nine Cents ($4,499,999.99); plus

         (2)   one and four-tenths  percent (1.4%) of the  Corporation's  Annual
               Net Income that is between Four  Million  Five  Hundred  Thousand
               Dollars ($4,500,000.00) and Six Million, Nine Hundred Ninety-Nine
               Thousand,  Nine Hundred Ninety-Nine Dollars and Ninety-Nine Cents
               ($6,999,999.99); plus

         (3)   seven-tenths  of one  percent  (0.7%)  of the  Corporation's  Net
               Income that is between Seven Million Dollars  ($7,000,000.00) and
               Ten Million Dollars ($10,000,000.00), inclusive.

         In the event the  Corporation's  Annual Net Income for any given fiscal
year is less than Two Million Dollars ($2,000,000.00), the Employee shall not be
entitled  to  a   Performance   Bonus  with   respect  to  such   fiscal   year.
Notwithstanding  anything contained herein to the contrary, in the event the sum
of the  Employee's  Performance  Bonus with  respect  to a fiscal  year plus the
Employee's  benefit under all  performance/production  incentive programs of the
Corporation in which the Employee is entitled to a bonus  ("Incentive  Benefit")
for such fiscal year  exceeds  Eighty-one  Thousand  Dollars  ($81,000.00),  the
amount of the  Employee's  Performance  Bonus for such year  shall be reduced so
that  the  sum of  the  Performance  Bonus  and  the  Incentive  Benefit  equals
Eighty-one Thousand Dollars ($81,000.00).

         For  purposes  of  the  calculation  of  the  Performance   Bonus,  the
Corporation's  "Annual  Net  Income"  means the  consolidated  net profit of the
Corporation and its subsidiaries,  for a given fiscal year, as determined by the
firm of independent  certified public accountants providing auditing services to
the Corporation,  using generally accepted  accounting  principles  consistently
applied,   and  calculated   without  regard  to  (a)  any  bonus  paid  to  the
Corporation's  Chairman of the Board and any formula  bonuses  paid  pursuant to
employment  contracts,  (b) federal and state  income tax, and (c) any income or
loss  attributable to any other corporation or entity (including the assets of a
corporation  or entity that  constitute  an operating  business)  acquired by or
merged into the Corporation  subsequent to the effective date of this Agreement.
The  Corporation  shall pay to Employee any  Performance  Bonus due the Employee
hereunder not later than fifteen (15) days after the receipt by the  Corporation
of its annual audited  financial  statements,  which the Corporation  expects to
receive  within  ninety  (90)  days  after  the end of each  fiscal  year of the
Corporation.

               (C) In  addition  to the Base  salary and  Performance  Bonus (if
any), Employee shall be entitled to receive such bonus compensation as the Board
of Directors of the Corporation may authorize from time to time.

               (D) The  Corporation  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.

         4. Duties of Employee.

               (A) Employee shall serve as General Manager of the  Corporation's
plant located in Tulsa, Oklahoma or in such other positions as may be determined
by the Board of Directors of the  Corporation,  and Employee  shall perform such
duties on behalf of the Corporation and its  subsidiaries by such means, at such
locations,  and in such  manner  as may be  specified  from  time to time by the
officers or Board of Directors of the Corporation.

               (B)  Employee  agrees  to  abide  by and  conform  to  all  rules
established by the Corporation applicable to its employees.

               (C)  Employee  acknowledges  that  he  is  being  employed  as  a
full-time  employee,  and Employee agrees to devote so much of Employee's entire
time,  attention and energies to the business of the Corporation as is necessary
for the successful  operation of the Corporation and shall endeavor at all times
to  improve  the  business  of the  Corporation.  Employee  shall not accept any
business commitments other than with the Corporation without the advance written
consent of the Corporation's President.

         5.  Expenses.  During the period of  Employee's  employment,  except as
otherwise  specifically  provided in this Agreement,  the  Corporation  will pay
directly,  or reimburse  Employee  for, all items of  reasonable  and  necessary
business  expenses  approved in advance by the  Corporation if such expenses are
incurred by Employee in the  interest of the  business of the  Corporation.  The
Corporation  shall also reimburse  Employee for automobile  expenses incurred by
Employee in the performance of Employee's duties  hereunder.  The amount of such
reimbursement  shall be in accordance with the automobile expense  reimbursement
policy  adopted  (and  as  it  may  be  modified  from  time  to  time)  by  the
Corporation's  Board of  Directors.  All such  expenses paid by Employee will be
reimbursed by the Corporation upon  presentation by Employee,  from time to time
(but not less than quarterly),  of an itemized  account of such  expenditures in
accordance with the Corporation's policy for verifying such expenditures.

         6. Fringe Benefits.

               (A)  Employee  shall be  entitled to  participate  in any health,
accident and life insurance program and other benefits which have been or may be
established by the Corporation for salaried employees of the Corporation.

               (B) Employee shall be entitled to an annual vacation without loss
of  compensation  for such period as may be determined by the Board of Directors
of the Corporation.

               (C) The Corporation shall furnish to the Employee during the term
of his employment an automobile  selected by the Corporation to aid the Employee
in the performance of his duties.

         7. Covenants of Employee.

               (A) During the term of Employee's employment with the Corporation
and for all time thereafter Employee covenants and agrees that Employee will not
in any manner directly or indirectly, except as required in Employee's duties to
the  Corporation,  disclose  or divulge to any person,  entity,  firm or company
whatsoever,  or use for  Employee's  own  benefit  or the  benefit  of any other
person, entity, firm or company, directly or indirectly, any knowledge, devices,
information,  techniques, customer lists, business plans or other data belonging
to the Corporation or developed by Employee on behalf of the Corporation  during
his  employment  with the  Corporation,  without  regard to  whether  all of the
foregoing  matters  will be deemed  confidential,  material  or  important,  the
parties  hereto  stipulating,  as  between  them,  that the same are  important,
material,  confidential and the property of the Corporation,  that disclosure of
the  same to or use of the  same by  third  parties  would  greatly  affect  the
effective  and  successful  conduct of the business of the  Corporation  and the
goodwill  of the  Corporation,  and  that  any  breach  of  the  terms  of  this
subparagraph (A) shall be a material breach of this Agreement.

               (B) During the term of Employee's employment with the Corporation
and for a period of two (2) years (the  "Covenant  Term")  after  cessation  for
whatever  reason  of  such  employment   (except  as  hereinafter   provided  in
subparagraph  (C) of this  paragraph  7),  Employee  covenants  and agrees  that
Employee will not in any manner directly or indirectly:

                     (i) solicit, divert, take away or interfere with any of the
         customers  (or  their  respective  affiliates  or  successors)  of  the
         Corporation;

                     (ii) engage directly or indirectly, either personally or as
         an employee,  partner,  associate  partner,  officer,  manager,  agent,
         advisor, consultant or otherwise, or by means of any corporate or other
         entity  or  device,  in any  business  which  is  competitive  with the
         business of the  Corporation.  For purposes of this covenant a business
         will be  deemed  competitive  if it is  conducted  in  whole or in part
         within  any  geographic  area  wherein  the  Corporation  is engaged in
         marketing its products, and if it involves the manufacture of component
         parts for the aerospace  industry or any other business which is in any
         manner  competitive,   as  of  the  date  of  cessation  of  Employee's
         employment,  with any business then being  conducted by the Corporation
         or as to which the Corporation has then formulated  definitive plans to
         enter;

                     (iii)   induce   any   salesman,   distributor,   supplier,
         manufacturer, representative, agent, jobber or other person transacting
         business with the Corporation to terminate their  relationship with the
         Corporation,   or  to   represent,   distribute  or  sell  products  in
         competition with products of the Corporation; or

                     (iv)  induce or cause any  employee of the  Corporation  to
         leave the employ of the Corporation.

               (C) The parties  agree that the Covenant Term provided for in the
preceding subparagraph (B) shall be:

                     (i)  reduced  to six (6)  months  in the  event  all of the
         operating  assets or all of the common stock of the Corporation is sold
         to any entity or individuals  unaffiliated  with the  Corporation,  its
         successors or assigns; or

                     (ii) eliminated if the business  currently  operated by the
         Corporation  is  terminated  and  the  assets  of the  Corporation  are
         liquidated.

               (D) All the covenants of Employee  contained in this  paragraph 7
shall be  construed as  agreements  independent  of any other  provision of this
Agreement,  and the  existence  of any  claim  or cause of  action  against  the
Corporation,  whether  predicated  on this  Agreement  or  otherwise,  shall not
constitute a defense to the enforcement by the Corporation of these covenants.

               (E) It is the intention of the parties to restrict the activities
of  Employee  under  this  paragraph  7 only  to the  extent  necessary  for the
protection of legitimate business interests of the Corporation,  and the parties
specifically  covenant  and agree that  should any of the  provisions  set forth
therein,  under any set of  circumstances  not now foreseen by the  parties,  be
deemed too broad for such purpose,  said provisions  will  nevertheless be valid
and enforceable to the extent necessary for such protection.

         8.  Documents.   Upon  cessation  of  Employee's  employment  with  the
Corporation,  for whatever reason,  all documents,  records  (including  without
limitation,    customer   records),    notebooks,    invoices,   statements   or
correspondence,  including  copies  thereof,  relating  to the  business  of the
Corporation  then in  Employee's  possession,  whether  prepared  by Employee or
others, will be delivered to and left with the Corporation,  and Employee agrees
not to retain copies of the foregoing  documents  without the written consent of
the Corporation.

         9. Remedies. In the event of the breach by Employee of any of the terms
of this Agreement,  notwithstanding  anything to the contrary  contained in this
Agreement,   the  Corporation  may  terminate  the  employment  of  Employee  in
accordance with the provisions of paragraph 2 of this  Agreement.  It is further
agreed  that any  breach or  evasion  of any of the terms of this  Agreement  by
Employee will result in immediate and irreparable  injury to the Corporation and
will authorize recourse to injunction and/or specific  performance as well as to
other legal or equitable  remedies to which the Corporation may be entitled.  In
addition  to any  other  remedies  that  it may  have  in  law  or  equity,  the
Corporation  also may  require  an  accounting  and  repayment  of all  profits,
compensation,  remuneration or other benefits realized,  directly or indirectly,
as a result of such  breaches  by the  Employee  or by a  competitor's  business
controlled,  directly or indirectly, by the Employee. No remedy conferred by any
of the specific  provisions of this Agreement is intended to be exclusive of any
other  remedy and each and every  remedy  given  hereunder  or now or  hereafter
existing at law or in equity by statute or otherwise. The election of any one or
more remedies by the  Corporation  shall not constitute a waiver of the right to
pursue other available remedies. Employee expressly agrees to pay all reasonable
costs and  attorneys'  fees incurred by the  Corporation in order to enforce the
Employee's obligations under this Agreement, regardless of whether litigation is
commenced or prosecuted to a judgment.

         10.  Severability.  All agreements and covenants  contained  herein are
severable, and in the event any of them shall be held to be invalid by any court
of competent jurisdiction,  this Agreement, subject to subparagraph 7(E) hereof,
shall  continue  in full force and effect  and shall be  interpreted  as if such
invalid agreements or covenants were not contained herein.

         11. Waiver or Modification. No waiver or modification of this Agreement
or of any  covenant,  condition  or  limitation  herein shall be valid unless in
writing and duly executed by the party to be charged therewith,  and no evidence
of any waiver or  modification  shall be offered or  received in evidence in any
proceeding,  arbitration or litigation between the parties hereto arising out of
or  affecting  this  Agreement,  or the  rights or  obligations  of the  parties
hereunder,  unless such waiver or modification  is in writing,  duly executed as
aforesaid,  and the parties  further agree that the provisions of this Paragraph
may not be waived  except as herein set forth.  Failure  of the  Corporation  to
exercise or  otherwise  act with  respect to any of its rights  hereunder in the
event of a breach of any of the terms or conditions hereof by Employee shall not
be  construed  as a waiver of such  breach  nor  prevent  the  Corporation  from
thereafter  enforcing  strict  compliance  with  any  and all of the  terms  and
conditions hereof.

         12.  Assignability.  The services to be performed by Employee hereunder
are  personal in nature and,  therefore,  Employee  shall not assign  Employee's
rights  or  delegate  Employee's  obligations  under  this  Agreement,  and  any
attempted or purported  assignment or delegation not herein  permitted  shall be
null and void.

         13.  Successors.  Subject  to the  provisions  of  paragraph  12,  this
Agreement  shall  be  binding  upon  and  shall  inure  to  the  benefit  of the
Corporation and Employee and their respective heirs, executors,  administrators,
legal administrators, successors and assigns.

         14. Notices.  Any notice or other  communication  required or permitted
hereunder  shall  be in  writing  and  shall be  deemed  to have  been  given if
delivered personally, by over-night courier, or by certified or registered mail,
return receipt requested, if to the Corporation, to:


                  Ronald S. Saks, President
                  LMI AEROSPACE, INC.
                  P.O. Box 900
                  St. Charles, MO  63302-0900

and, if to Employee, to:

                  Robert T. Grah
                  ----------------------

                  ---------------------

                  ---------------------

or to such other  address as may be  specified  by either of the  parties in the
manner provided under this paragraph 14.

         15.  Construction.  This Agreement  shall be deemed for all purposes to
have been made in the State of Missouri  and shall be governed by and  construed
in accordance with the laws of the State of Missouri, notwithstanding either the
place  of  execution  hereof,  nor the  performance  of any  acts in  connection
herewith or hereunder in any other jurisdiction.

         16. Venue.  The parties hereto agree that any suit filed arising out of
or in connection  with this Agreement shall be brought only in the United States
District  Court for the Eastern  District of  Missouri,  unless that court lacks
jurisdiction,  in which case such  action  shall be brought  only in the Circuit
Court for St. Louis County, Missouri.

         17. Disclosure of Existence of Agreement. To preserve the Corporation's
rights under this  Agreement,  the Corporation may advise any third party of the
existence  of this  Agreement  and its  terms,  and  the  Employee  specifically
releases  and agrees to indemnify  and hold the  Corporation  harmless  from any
liability for doing so.

         18. Opportunity to Review. Employee hereby represents and warrants that
he has had an  opportunity  to review  this  Agreement  and ask the  Corporation
questions  about the Agreement,  and  understands the meaning and effect of each
paragraph of this Agreement.


<PAGE>


         The parties have executed this Agreement as of January 1, 2002.


                                      LMI AEROSPACE, INC.
                                      ("Corporation")


                                       By:  /s/ Ronald S. Saks
                                            ------------------------------------
                                            Ronald S. Saks, President

                                       /s/ Robert T. Grah
                                       -----------------------------------------
                                       Robert T. Grah
                                       ("Employee")

</TEXT>
</DOCUMENT>
