EXHIBIT 10.32
EMPLOYMENT AGREEMENT
This Employment Agreement by and between MIDWAY AIRLINES CORPORATION, a
Delaware corporation (the "Company"), and XXXXXX XXXXXXXX (the "Executive") is
dated as of the 15th day of July, 1996 (the "Agreement").
WHEREAS, the Company desires to continue the employment of the Executive in
an executive capacity because of his experience, ability and knowledge which are
extremely valuable to the Company; and
WHEREAS, the Executive desires that his employment by the Company continue
on the terms and conditions set forth herein, and the Company and the Executive
desire to enter into the Agreement.
NOW, THEREFORE, it is hereby agreed as follows:
1. CERTAIN DEFINITIONS. The "Effective Date" of this Agreement shall be
July 15, 1996 (the "Effective Date").
2. TERMS OF EMPLOYMENT.
(a) POSITION AND DUTIES. From and after the Effective Date, the
Executive shall serve in the position of Senior Vice President - Finance and
Planning and Chief Financial Officer and shall perform the attendant
responsibilities thereto including the supervision of all treasury, accounting,
pension administration, insurance procurement, tax planning, budgeting and
financial planning as well as such other responsibilities as the Board of
Directors of the Company or the Chief Executive Officer may from time to time
assign.
(b) Excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive agrees to devote his full attention and
time during normal business hours to the business and affairs of the Company
and, to the extent necessary to discharge the responsibilities assigned to the
Executive hereunder, to use the Executive's reasonable best efforts to perform
faithfully and efficiently such responsibilities. During the term of
Executive's employment it shall not be a violation of this Agreement for the
Executive to (i) serve on charitable or non-conflicting civic boards or
committees and (ii) manage personal investments, so long as such activities do
not interfere with the performance of the Executive's responsibilities as an
employee of the Company in accordance with this Agreement.
(c) COMPENSATION.
(i) BASE SALARY. The Executive shall receive an annual base
salary of USD $165,000 paid in equal monthly installments subject to such
withholding and deductions as are required by law or agreed upon ("Base
Salary"). The Company's Compensation Committee shall review the Executive's
Base Salary hereunder from time to time, but not less frequently than each
Company fiscal year and, in its discretion, may adjust such Base Salary in such
amount as it deems appropriate for any future year of this Agreement; provided,
however, that the specified rate of Base Salary hereunder shall not be reduced
below $165,000.
(ii) ANNUAL BONUS. In addition to Base Salary, the Executive
shall, in the discretion of the Company's Board of Directors, be awarded, for
each fiscal year during the
Employment Period, an annual bonus in accordance with the Company's bonus plan
for senior managers.
(iii) BENEFIT PLANS. During the Executive's employment, the
Executive shall be eligible for participation in and shall receive all benefits
under the Company's benefit plans provided to other senior executive officers by
the Company.
(iv) EXPENSES. During the Executive's employment, the Executive
shall be entitled to receive prompt reimbursement for all pre-approved expenses
incurred by the Executive with appropriate receipts to serve as verification in
accordance with the most favorable policies and procedures of the Company.
(v) AUTO ALLOWANCE. During the term of Executive's employment,
the Executive shall be entitled to payment of an automobile allowance of up to
$500.00 per month for automobile and related expenses ("Auto Allowance").
(vi) VACATION. During the Executive's employment, the Executive
shall be entitled annually to four (4) weeks of paid vacation.
(vii) STOCK. As of the date set forth therein, the Executive
shall receive a stock award (the "Stock Award") consisting of Class C Common
Stock, $.01 par value per share, of the Company.
(viii) RELOCATION ASSISTANCE. Company will reimburse or pay
Executive for the reasonable costs of the packing and moving of Executive's
household goods from Texas to North Carolina and customary closing costs and
real estate commissions payable in connection with the sale of Executive's home
in Texas. The Company will engage a relocation company to assist Executive in
his relocation and the payments or reimbursements described herein will be made
through such relocation company. Company will be responsible for any income
taxes arising from the payments or reimbursements described herein.
(viii) AIRLINE TRAVEL. During the term or Executive's
Employment, the Company will provide Executive and Executive's spouse and
dependent children with free airline travel on flights operated by the Company
and/or its successors, on the same terms established for other senior executives
of the Company (the "Airline Travel Benefit").
3. TERMINATION.
(a) DEATH. In the event the Executive dies, this Agreement shall
automatically terminate.
(b) DISABILITY. If the Board of Directors of the Company determines,
in the reasonable exercise of its discretion, that the Executive, through
physical or mental illness or disability, whether or not connected to his
employment hereunder, has become incapacitated and is unable for a period of six
(6) months during any continuous period of twelve (12) months, to discharge the
duties and responsibilities of his employment hereunder (a "Disability"), the
Board of Directors of the Company shall have the right by written notice to the
Executive to terminate his employment.
(c) CAUSE. The Company may terminate the Executive's employment for
"Cause." For the purposes of this Agreement, "Cause" means (i) an act or acts
of personal
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dishonesty taken by the Executive to the detriment of the Company; (ii)
violations by the Executive of the Executive's obligations under Section 2(a) or
Section 6 of this Agreement; provided, that from and after a "Change in Control"
such a violation shall constitute Cause only if demonstrably willful and
deliberate on the Executive's part; (iii) the conviction of the Executive of a
felony; or (iv) the violation of any statutory or common law duty of loyalty to
the Company. For purposes of this provision, "Change in Control" shall mean the
sale by the Company of all or substantially all of its assets and business to
any person or entity other than Xxxx/Chilmark Fund L.P., or any entity under
common control therewith, or any entity or person in direct or indirect control
of said Xxxx/Chilmark Fund L.P. (each of such entities and persons being herein
referred to as a "Related Person") or the sale or issuance of such voting
securities of the Company representing votes sufficient to elect a majority of
the Company's Board of Directors to any person or entity other than a Related
Person.
(d) NOTICE OF TERMINATION. Any termination by the Company for Cause
shall be communicated by a Notice of Termination to the Executive given in
accordance with this Agreement. For purposes of this Agreement, a "Notice of
Termination" means a written notice which (i) indicates the specific termination
provision in this Agreement relied upon and (ii) if the Date of Termination (as
defined below) is other than the date of receipt of such notice, specifies the
termination date.
(e) DATE OF TERMINATION; SEVERANCE PERIOD. "Date of Termination"
means the date of receipt of the Notice of Termination or any later date
specified therein. "Severance Period" means the longer of (i) the twelve (12)
month period following the Date of Termination and (ii) the period following the
Date of Termination to and including December 31, 1997.
4. OBLIGATIONS OF THE COMPANY UPON TERMINATION.
(a) DEATH. In the event the Executive dies at a time when he is
still covered by this Agreement, the Executive's estate shall receive any
benefits pursuant to plans described in Section 2(c)(iii), together with any
compensation previously deferred by the Executive (with accrued interest
thereon).
(b) CAUSE. If the Executive's employment shall be terminated for
Cause, this Agreement shall terminate without further obligations to the
Executive hereunder other than the obligation to pay to the Executive the Base
Salary through the Date of Termination plus the amount of any compensation
previously deferred by the Executive (together with accrued interest thereon).
(c) TERMINATION OTHER THAN FOR CAUSE OR DISABILITY. If, during the
Employment Period, (x) the Company shall terminate the Executive's employment
other than for Cause, Disability or death, or (y) Executive shall voluntarily
terminate his employment within forty-five (45) days after a Constructive
Termination (as defined below):
(i) the Company shall continue to pay to the Executive the
aggregate amount of his Base Salary and Auto Allowance for the period commencing
on the Date of Termination and ending on the expiration of the Severance Period
in accordance with the Company's then current payroll schedule; provided,
however, that any such payments shall be reduced by the amount of cash
compensation offered to Executive as part of an offer of employment made by
Xxxxxx Xxxx or an entity directly or indirectly controlled by Xxxxxx Xxxx or
controlled by or under common control with Xxxx/Chilmark Fund, L.P. (Xxxxxx Xxxx
or any such entity hereinafter a "Xxxx Employer"), provided, that such offer of
employment is generally on the
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same terms (other than geographic location) and at the same or higher rate of
compensation provided for in this Agreement; provided, further, that if no such
offer of employment is made to Executive at any time during the Severance
Period, any such payment shall be reduced by the amount of cash compensation
received by Executive from another employer during, or in consideration for work
performed by Executive during, the Severance Period; provided, however, that the
preceding clause shall in no event impose upon Executive any obligation to seek
or accept an offer of employment from another employer; provided, further, that
for purposes of this Section 5(d)(i), "control" shall mean the power, directly
or indirectly, to direct or cause the direction of the management and policies
of a person or entity, whether through the ownership of voting securities, by
contract or otherwise;
(ii) the Company shall pay to the Executive during the period
commencing on the Date of Termination and ending on the earlier of (x) the date
on which the Executive commences employment with another employer and (y) the
end of the Severance Period an amount that would permit the Executive to receive
medical benefits comparable to benefits received by the Executive during the
last full fiscal year during the term of Executive's employment;
(iii) in the case of compensation previously deferred by the
Executive, the Company shall pay to the Executive within thirty (30) days of the
Date of Termination all amounts previously deferred (together with any accrued
interest thereon) and not yet paid by the Company, and any accrued vacation pay
not yet paid by the Company;
(iv) the Company and/or its successors shall continue to provide
the Airline Travel Benefit to the Executive and the Executive's spouse, for such
of their respective lifetimes, and the Executive's dependent children, for so
long as they remain dependent children as such term is used in the airline
(non-revenue) travel industry, except that the same shall be at an "A-3"
Priority Level or at least at the priority level from time to time made
available by the Company and/or its successors to the senior officers (and their
family members) of airlines other than the Company;
(v) the Company shall pay, or reimburse Executive for, the cost
of reasonable and appropriate outplacement services provided through the
Severance Period by an outplacement firm selected by Xxxx/Chilmark Fund L.P.;
and
(vi) the Company will affirm, perform and be responsible for its
obligations under that certain Agreement for Relocation Services, dated
August 17, 1995 between the Company and Xxxxxxxxx Relocation Company. As such,
the Company will identify Executive's primary residence in North Carolina as a
"Home" under such Relocation Agreement, and the Company will reimburse or pay
Executive for the reasonable costs of packing and moving Executive's and
Executive's family's household goods from North Carolina, as well as customary
closing costs and real estate commissions payable in connection with the sale of
Executive's Home in North Carolina; provided, however, that in the event of a
Change in Control, this Section 5 (b)(vi) shall apply only to Executive's
primary residence owned by Executive and/or Executive's spouse, as the case may
be, prior to such Change in Control.
For purposes hereof, the term "Constructive Termination" shall mean (xx) the
assignment of Executive by the Board of Directors or a superior officer of the
Company, duties materially inconsistent with the scope of Executive's position,
duties and responsibilities as described in this Agreement to the detriment
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of Executive, or (yy) the Company's failure to materially comply with any of the
provisions of Section 2(c) above.
5. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit, bonus,
incentive or other plan or program provided by the Company and for which the
Executive may qualify, nor shall anything herein limit or otherwise affect such
rights as the Executive may have under any stock option or other agreements with
the Company or any of its affiliated companies.
6. CONFIDENTIAL INFORMATION. The Executive shall maintain a fiduciary
duty to the Company for all confidential information, knowledge or data relating
to the Company or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the Executive during the
Executive's employment by the Company or any of its affiliated companies until
such confidential information, knowledge or data become a matter of public
record through disclosure by a person or persons other than the Executive or his
representatives and which does not involve communication or disclosure, directly
or indirectly, by the Executive or his representatives. The Executive shall not
communicate or disclose any such information, knowledge or data to anyone other
than the Company and those designated by it. After termination of the
Executive's employment with the Company, the Executive shall return all
confidential and proprietary information in his possession or under his control
and shall not, without the prior written consent of the Company, communicate or
disclose any such information, knowledge or data to anyone other than the
Company and those designated by it.
7. SUCCESSORS.
(a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive other
than by will or the laws of descent and distribution. This Agreement shall
inure to the benefit of and be enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
(c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place; provided however the foregoing shall not prevent the Company
from terminating this Agreement pursuant to Sections 3 and/or 4 of this
Agreement. As used in this Agreement, "Company" shall mean the Company as
herein defined and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by operation of law or
otherwise.
8. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of North Carolina, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
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(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive: to his address as set forth in the records of
the Company.
If to the Company: Midway Airlines Corporation
000 Xxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
with a copy to: Xxxxxxxxx & Xxxxxxxxxxx, P.C.
Two Xxxxx Xxxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(e) The Executive's and/or the Company's failure to insist upon
strict compliance with any provision hereof shall not be deemed to be a waiver
of such provision thereof.
(f) This Agreement, together with the Stock Award, contain the entire
understanding of the Company and the Executive with respect to the subject
matter hereof and supersede any and all other agreements, either oral or
written, between the Company and the Executive with respect to the subject
matter hereof.
(g) The Executive and the Company acknowledge that the employment of
the Executive by the Company is "at will"; provided, that such employment may be
terminated by the Company only in accordance with the terms hereof.
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IN WITNESS WHEREOF, the Executive has hereunder set his hand and,
pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.
EXECUTIVE:
_______________________________
Xxxxxx Xxxxxxxx
MIDWAY AIRLINES CORPORATION
_______________________________
Xxxx X. Xxxxxxxxx
President and Chief Executive
Officer
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AMENDMENT TO EMPLOYMENT AGREEMENT
---------------------------------
Amendment to Employment Agreement (the "Amendment") by and between
MIDWAY AIRLINES CORPORATION, a Delaware corporation (the "Company"), and
Xxxxxx Xxxxxxxx (the "Executive"), dated as of January 17, 1997.
WHEREAS, the Company and Executive are party to that certain Employment
Agreement, dated as of July 15, 1996 (the "Employment Agreement") (all terms
capitalized but not otherwise defined herein shall have the meanings ascribed
to them in the Employment Agreement).
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
(a) Section 2(c)(vii) of the Employment Agreement is hereby
deleted in its entirety; and
(b) all references in the Employment Agreement to the Stock Award
are hereby deleted in their entirety, and the Stock Award shall no longer
constitute a term or condition of the Employment Agreement or a benefit
afforded to Executive thereunder, and Executive hereby waives all rights
he has or may have to the Stock Award under the Employment Agreement or
any other agreement or commitment, written or oral, relating to the
Stock Award.
Except as specifically amended hereby, the Employment Agreement shall
remain in full force and effect in the form originally executed by the
parties.
Notwithstanding anything to the contrary herein, this Amendment shall
not be effective until the Effective Time as defined in that certain
Agreement and Plan of Merger, dated as of the date hereof, by and among
GoodAero, Inc. and its stockholders, the Company and Xxxx/Chilmark Fund, L.P.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first above written.
EXECUTIVE:
/s/ XXXXXX XXXXXXXX
----------------------------
Xxxxxx Xxxxxxxx
MIDWAY AIRLINES CORPORATION:
/S/ XXXXXXXX XXXXXX
----------------------------
By: Xxxxxxxx Xxxxxx
Its: Senior Vice President
