EXHIBIT 10.26
EMPLOYMENT AGREEMENT
DATED AS OF JANUARY 4, 1999
BETWEEN
AIR XXXX HOLDINGS, INC.
AND
XXXXXX X. XXXXXXX
This Employment Agreement (henceforth the "Agreement") is made and entered into
as of this Fourth day of January 1999 (the "Effective Date") by and between
XXXXXX X. XXXXXXX (henceforth the "Executive") and AIR XXXX HOLDINGS, INC., a
Nevada corporation (henceforth the "Company").
RECITALS
A. The non-management members of the Company's Board of Directors (henceforth
the "Board") believe the Executive to be the best qualified individual to
protect and enhance the best interests of the Company and its stockholders
and that entering into this Agreement to ensure the Executive's long-term
employment with the Company is in the best interests of the Company and its
stockholders.
B. The Company recognizes that, as in the case of many publicly-held
corporations, the possibility of a change of control may exist and that the
uncertainty and questions which such possibility may raise among management
may result in the departure or distraction of management personnel to the
detriment of the Company and its stockholders.
C. The non-management members of the Board have determined that in the event
of that contingency, it is imperative to be able to rely on management's
continuance and in particular, the leadership of the Executive and that
appropriate steps should be taken to secure that essential service.
D. The Executive and the Company now desire to enter into this Agreement.
CONTRACT TERMS
1. DEFINITIONS
1.1 "Affiliate" means any Person directly or indirectly controlling or
controlled by or under the direct or indirect common control with such
Person. For purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise.
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1.2 "Affiliated Company" means
1.2.1 A member of a controlled group of corporations of which the
Company is a member or;
1.2.2 An unincorporated trade or business which is under common
control with the Company as determined in accordance with
Section 414(c) of the Internal Revenue Code of 1986, as amended
(henceforth the "Code") and regulations issued thereunder.
1.2.3 For purposes hereof, a "controlled group of corporations" shall
mean a controlled group of corporations as defined in Section
1563(a) of the Code determined without regard to Section
1563(a)(4) and (e)(3)(C) of the Code.
1.3 A "Change of Control" will be deemed to have occurred in the event
that, after the date of this Agreement:
1.3.1 Any Person, or Persons acting together that would constitute a
"group" (a "Group"), for purposes of Section 13(d) of the
Securities Exchange Act of 1934 as from time to time amended,
together with any Affiliates or Related Persons thereof (other
than any employee stock ownership plan), beneficially owns 50%
or more of the total voting power of all classes of Voting
Stock of the Company;
1.3.2 Any Person or Group, together with any Affiliates or Related
Persons thereof, succeeds in having a sufficient number of its
nominees elected to the Board of Directors of the Company such
that such nominees, when added to any existing director
remaining on the Board of Directors of the Company after such
election who is an Affiliate or Related Person of such Person
or Group, will constitute a majority of the Board of the
Company;
1.3.3 There occurs any transaction, or series of related
transactions, and the beneficial owners of the Voting Stock of
the Company immediately prior to such transaction (or series)
do not, immediately after such transaction (or series),
beneficially own Voting Stock representing more than 50% of the
voting power of all classes of Voting Stock of the Company (or
in the case of a transaction (or series) in which another
entity becomes a successor to the Company, of the successor
entity); or,
1.3.4 The Company shall cease to own a majority of the capital stock
of its operating subsidiaries, provided that the foregoing
shall not apply with respect to any such Person or Group
referred to in
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Clauses 1.3.1 or 1.3.2 above, which consists exclusively, or to
any transaction (or series) referred to in Clause 1.3.3 above
if at least 50% of such voting power is beneficially owned
immediately thereafter by any Person or Group, which consists
exclusively, of any one or more Permitted Holders and their
Affiliates (while they are such).
1.4 "Disability" shall mean the permanent and total inability by reason of
mental or physical infirmity or both, of the Executive to perform the
work customarily assigned to him. Additionally, a medical doctor,
selected or approved by the Board must advise the Board that it is
either not possible to determine when such Disability will terminate
or that it appears probable that such Disability will be permanent
during the remainder of the Participant's lifetime. If the Company
secures an "own occupation" disability policy to cover its liability
pursuant to this Agreement, such definition in the policy shall be
deemed to control.
1.5 "Person" means any individual, corporation, partnership, trust, joint
venture or other legal entity holding, or acquiring Voting Stock of
the Company.
1.6 "Permitted Holder" means Xxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxxxxxx, Xx,
Xxxxx X. Xxxxxx, Xxxxxxx X. Xxxxx, Xxxxxx Xxxxx, Don. X. Xxxxxxx and
Xxxxxxx X. Xxxxx.
1.7 "Related Person" means any Person owning:
1.7.3 5% or more of the outstanding Common Stock of such Person; or,
1.7.4 5% or more of the Voting Stock of such Person.
1.8 "Termination for Cause" means the termination as a result of a
conviction for a willful violation of any law, rule or regulation
(other than traffic violations or similar offenses), that results in a
material loss to the Company or one of its Affiliates, or a material
breach of this Agreement on the part of the Executive that is not
cured within ten (10) business days of notification by the Company.
1.9 "Voting Stock" means any equity security or series of equity
securities, issued by the Company which are entitled to vote for
Directors of the Company.
2. TERM
2.1 Initial Term - The term of this Agreement shall commence on the date
first noted above, and shall terminate on December 31, 2001 unless
extended, pursuant to Section 2.2.
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2.2 Extension - This Agreement shall be automatically extended by one year
each January 1, unless the Company or Executive provides 90 days
notice before such anniversary date of the intention to terminate the
Agreement.
3. POSITION AND DUTIES
3.1 Executive shall be employed by the Company no later than January 11,
1999 as its President, Chief Executive Officer and Chairman of the
Board. Executive shall report directly and solely to the Company's
Board. Executive agrees to serve as Chairman of the Board. The duties
and responsibilities of the Chairman of the Board, President and Chief
Executive Officer shall be as defined in the by-laws of the Company in
effect as of the date hereof, and shall be without consideration of
other positions the Executive may hold with the Company. Executive's
services are mutually agreed to be unique.
3.2 During Executive's period of service hereunder, Executive agrees to
perform such services not inconsistent with his position as shall from
time to time be assigned to him by the Company's Board. During the
Term (both the Initial Term and as extended), except for disability,
illness and vacation periods, Executive shall devote his full
productive time, attention and energies to the position of Chairman of
the Board, President and Chief Executive Officer.
3.3 Executive's expenditure of reasonable amounts of time in connection
with outside activities, not competitive with the business of the
Company, such as outside directorships or charitable or professional
activities shall not be considered in contravention of this Agreement
so long as such activities do not materially interfere with his
performance of this Agreement . Further, it is understood and agreed
by the parties hereto that Executive is entitled to engage in passive
and personal investment activities not materially interfering with his
performance of this Agreement.
3.4 Service as an executive of an Affiliated Company, whether separately
compensated or not, shall not be considered in contravention of this
Agreement.
4. SALARY
4.1 Throughout the Initial Term of this Agreement, the Executive shall
receive an annual base salary of at least $350,000.
4.2 The Board (or such committee designated by the Board) shall review the
Executive's salary at least annually, at or before the first regularly
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scheduled Board meeting following the annual stockholders' meeting of
each fiscal year. The Board (or the relevant committee) may increase
the base salary based upon relevant considerations, including, but not
limited to the performance of the Executive and the Company, changes
in the cost of living and competitive compensation data.
5. INCENTIVE COMPENSATION
5.1 In addition to the salary stated in Section 4, the Executive shall be
eligible for an annual cash incentive award based on his performance
and the performance of the Company. Unless otherwise amended by the
Company with the agreement of the Executive, the annual cash incentive
award shall be calculated in the following manner:
5.1.1 The Board shall note the Applicable T-Xxxx Rate at the
commencement of the year, such rate equal to the current
twelve-(12) month Treasury Xxxx rate as of January 1.
5.1.2 A Multiplier shall be established equal to one hundred percent
(100%) divided by the difference between twenty percent (20%)
and the Applicable T-Xxxx Rate.
5.1.3 At the close of the fiscal year, the Company shall compute its
Return On Equity, as follows:
5.1.3.1 Income shall be determined as pre-tax, pre-bonus
income, less estimated taxes, determined by Generally
Accepted Accounting Principles;
5.1.3.2 Equity shall be determined as Stockholder's Equity as
of the close of the immediately preceding Fiscal Year,
as determined by Generally Accepted Accounting
Principles.
5.1.3.3 Return on Equity shall be determined by dividing
Income (as determined in Section 5.1.3.1) by Equity
(as determined in 5.1.3.2)
5.1.4 The difference between the Return on Equity and the Applicable
T-Xxxx Rate shall be multiplied by the Multiplier to determine
the Executive's Incentive Percentage.
5.1.5 The Incentive Percentage shall be multiplied by the Executive's
current base salary of record to determine his incentive
payment for the year.
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5.1.6 If the payment pursuant to Section 5.1.5 would exceed one-
hundred and fifty percent (150%) of the Executive's base
salary, such payment shall be capped at 150% of base salary.
6. STOCK OPTIONS
6.1 Executive shall be eligible to participate in any Stock Option plans
maintained by the Company and any additional or successor plans
created from time to time.
6.2 As of the Effective Date, or the date on which the selection of the
Executive as President, Chief Executive Officer and Chairman is
reported in the national news media, whichever occurs first, the
Executive shall be granted a Stock Option for the purchase of
1,500,000 shares of the Company's Common Stock. The option shall:
6.2.1 Have an exercise price equal to 100% (one hundred percent) of
the fair market value of the Company's Common Stock as of the
closing price of the date of grant as traded on the NASDAQ
National Market.
6.2.2 Vest in three installments at the rate of 40% on the first
anniversary of the grant, 30% on the second anniversary of the
grant and 30% on the third anniversary of the grant.
6.2.3 Vest 100% if the Executive is terminated without Cause
(including termination due to death or Disability), after July
11, 2000. If the Executive is terminated without Cause
(including termination due to death or Disability) prior to
July 11, 2000, 1,000,000 Options shall be vested.
6.2.4 Accelerate and become fully vested in the event of a Change of
Control.
6.2.5 Be exercisable for a period of 10 years following the grant,
subject to earlier termination only if the Executive is
terminated for Cause pursuant to Section 13.2 or terminates his
employment other than pursuant to Section 14. If the Executive
terminates employment due to death or Disability, the
provisions of the Company's stock option plan shall control, as
to time allowable to exercise vested stock options.
6.2.6 Provide that if antidilution protection is provided to any
member of a group including Messrs. Xxxxx Xxxxxx, Xxxxxx Xxxxxx
or Xxx Xxxxxxx, identical protection shall be extended to the
Options granted to the Executive pursuant to this Agreement.
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6.3 In addition to the Stock Option grant pursuant to Section 6.2 the
Executive shall be eligible for additional grants on an annual basis,
consistent with other executives of the Company and competitive
practices.
7. SIGNING BONUS
The Company acknowledges that the Executive has forfeited significant
valuable rights regarding stock options, restricted stock, deferred
compensation and retirement benefits, both qualified and non-qualified from
his former employer in accepting the position with the Company. In
recognition of this, as well as the risk assumed by the Executive in this
position, the Company shall provide to the Executive a lump sum cash
payment of $100,000 payable on the Effective Date.
8. REIMBURSEMENT OF EXPENSES
The Executive shall be authorized to incur and shall be reimbursed by the
Company for all reasonable expenses for the advancement of the Company's
business pursuant to standing Company policy at least monthly.
9. MOVING EXPENSES
9.1. Recognizing that it is in the interests of the Company that the
Executive commence work at Company headquarters as quickly and
efficiently as possible, the Company will reimburse the Executive for
actual expenses connected with selling his primary residence in
California, acquiring a new residence and relocating. Such
reimbursement shall include, but not be limited to:
9.1.1 Commissions on the sale of the Executive's current primary
residence;
9.1.2 All transfer fees and taxes connected with the Executive's
current residence which are typically paid by the seller,
exclusive of any capital gains associated with the sale of the
residence;
9.1.3 Reasonable house-hunting expenses for the Executive and the
Executive's spouse;
9.1.4 Closing costs on the purchase of a new residence, including all
fees and taxes which are typically paid by the buyer, including
any mortgage points;
9.1.5 All costs connected with the transportation of the Executive,
his family and household goods from California to his new
residence.
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9.1.6 The provision of an apartment in the Orlando area for two
months.
9.2 The Executive will exercise reasonable judgment with regard to
incurring moving expenses to control such costs through the use of
multiple estimates and bids. In no event shall the Company be
obligated to pay moving expenses in excess of One Hundred Fifty
Thousand Dollars ($150,000).
10. OTHER BENEFITS
10.1 The Executive shall be eligible to participate in any and all other
benefit programs which are, and which may be in the future, generally
available to members of the Company's management, including, but not
limited to group health, disability, and life insurance benefits,
participation in any pension, retirement and/or profit-sharing plans,
financial planning, or other perquisites.
10.2 The Company shall provide free air transportation on any route
maintained by the Company for the Executive and his spouse for the
lifetimes of both the Executive and his spouse during employment and
for life on the completion of two years service.
11. DISABILITY
If the Executive's services hereunder are terminated due to Disability as
defined in the Agreement, the Executive shall receive:
11.1 His full salary for the remainder of the Initial Term, offset by any
amounts payable from a disability policy maintained by the Company.
11.2 Any stock options or stock appreciation rights granted to the
Executive shall be immediately vested; and,
11.3 The Executive and his spouse shall retain the travel benefits noted in
Section 10.2.
12. DEATH BENEFITS
12.1 In addition to participation in any life insurance plans maintained by
the Company, to the extent that the Company's group term life
insurance provides a death benefit of less than $1,000,000, the
Company shall pay the premium on a universal life insurance policy to
be owned by the Executive equal to the difference between the coverage
provided by the Company and $1,000,000. Company's premiums need only
be sufficient to maintain the face death benefit of the policy.
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12.2 This insurance policy shall be in lieu of any continuation of salary
or incentives pursuant to Sections 4 or 5 of this Agreement, other
than accrued but unpaid salary or incentive compensation.
13. TERMINATION BY THE COMPANY
Company shall have the right to terminate the Executive's service hereunder
under the following circumstances:
13.1 Upon ten (10) business days' written notice from the Company to the
Executive in the event of Disability which has incapacitated the
Executive from performing his duties for a period of at least six (6)
consecutive months, subject to the provisions of Section 11.
13.2 For Cause, as defined in this Agreement, upon immediate written
notice;
13.3 Upon immediate written notice to the Executive where the Board, by a
majority vote, elects to terminate the Executive for any reason, other
than the reasons noted in Sections 13.1 and 13.2 above.
13.4 Upon the death of the Executive, subject to the provisions of Section
12.
14. TERMINATION BY THE EXECUTIVE
Executive shall have the right to terminate his service under this
Agreement upon 90 days written notice following the date on which the
Executive becomes aware of any of the following without the consent of the
Executive:
14.1 The Executive is not elected or retained as Chairman, President and
Chief Executive Officer and a director of the Company during the term
of this Agreement, including any extensions;
14.2 Any assignment of the Executive of any duties other than those
reasonably contemplated by, or any limitation of the powers or
prerogatives of Executive in any respect not reasonably contemplated
by Section 3 of this Agreement, including, but not limited to the
creation by the Board of a multi-person Office of the Chairman;
14.3 Any removal of the Executive from responsibilities substantially
similar to those described or contemplated in Section 3 hereof;
14.4 Any reduction in, or limitation upon the compensation, reimbursable
expenses or other benefits provided in this Agreement, other than as
may be required by valid public law or regulation;
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14.5 Any assignment to the Executive of duties which would require him to
relocate or transfer his principal place of residence or the transfer
of the headquarters of the Company to any location without the
expressed written agreement of the Executive.
15. BENEFITS FOLLOWING TERMINATION
15.1 If the Executive's employment with the Company is terminated pursuant
to Section 13.1, the Executive shall receive the benefits noted in
Section 11 of this Agreement.
15.2 If the Executive's employment with the Company is terminated pursuant
to Section 13.2, this Agreement shall terminate immediately. Any
unvested stock options or other benefits shall be immediately
forfeited upon the effective date of termination, as shall any accrued
but unpaid amounts with regard to salary, bonuses or other benefits.
15.3 If the Executive's employment with the Company is terminated pursuant
to Section 13.3, the Executive shall be entitled to:
15.3.1 A lump sum payment of $500,000;
15.3.2 Immediate vesting of any stock options, to the extent provided
in Section 6.2.3 of this Agreement;
15.3.3 Immediate vesting of any other benefits provided by the
Company consistent with operation of law.
15.3.4 Continued participation in any health or insurance plans
maintained by the Company for a period of 36 months. If, by
operation of law, the Executive is prohibited from
participation in a plan, the Company shall pay to the
Executive funds sufficient to maintain equivalent coverage on
an individual, such coverage to terminate when the Executive
is provided with substantially similar coverage by a
subsequent employer; and,
15.3.5 The Executive and his spouse shall retain the travel benefits
noted in Section 10.2.
15.4 If the Executive's employment with the Company is terminated pursuant
to Section 13.4, the Executive or his beneficiary or estate shall
receive the benefits noted in Section 12 of this Agreement.
15.5 If the Executive terminates this Agreement pursuant to Section 14, he
shall be entitled to the same benefits as if the Company had
terminated him without cause pursuant to Section 13.3.
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15.6 If the Executive is terminated by the Company other than for Cause or
if the Executive terminates employment for death, disability or
pursuant to Section 14, he will receive a pro-rated bonus for the year
of termination based upon the number of days worked in the year of
termination.
15.7 If the Executive terminates this Agreement other than pursuant to
Section 14, he shall be entitled to:
15.7.1 Accrued but unpaid amounts with regard to salary and benefits;
15.7.2 Any previously vested Stock Options;
15.7.3 Such other benefits and amounts as the Company shall determine
appropriate.
15.7.4 No bonus shall be payable pursuant to Section 5 if the
Executive terminates employment prior to the end of a year
other than pursuant to Section 14.
16. CHANGE OF CONTROL
In the event of a Change of Control as defined in this Agreement, the
termination benefits payable pursuant to this Section shall supersede any
other termination benefits and shall be in lieu of and not in addition to
the termination benefits set forth elsewhere in this Agreement.
16.1 Any outstanding stock options shall vest 100% at the time of the
Change of Control.
16.2 The Executive shall have twenty-four (24) months following the Change
of Control to elect to terminate this Agreement.
16.3 If the Company elects to terminate this Agreement within six months
before or twenty four months following a Change of Control for any
reason other than death, Disability or Cause, the Executive shall
receive termination benefits pursuant to this Section 16.
16.4 If the Agreement is terminated pursuant to this Section 16, Executive
shall be entitled to:
16.4.1 Immediate vesting of any stock options not previously vested;
16.4.2 Continued participation in any health or insurance plans
maintained by the Company for a period of 36 months. If, by
operation of law, the Executive is prohibited from
participation in a plan, the
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Company shall pay to the Executive funds sufficient to
maintain equivalent coverage on an individual basis;
16.4.3 The Executive and his spouse shall retain the travel benefits
noted in Section 10.2; and,
16.4.4 A lump sum payment of one million dollars ($1,000,000) in lieu
of any other termination benefits under this Agreement other
than those specified in this Section 16.
17. INDEMNIFICATION
In the event Executive is made, or threatened to be made a party to any
legal action or proceeding, whether civil or criminal or administrative, by
reason of the fact that Executive is, or was, a director or officer of the
Company or serves or served any other Affiliate in any capacity at the
request of the Company, Executive shall be indemnified by the Company, and
the Company shall pay Executive's related expenses when and as incurred, to
the full extent permitted by law, if he acted in good faith and in a manner
he believed to be in or not opposed to the best interests of the Company
and, in the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
18. REMEDIES
Company recognizes that because of Executive's special talents and
opportunities, in the event of termination by the Company, other than for
Cause, Company acknowledges and agrees that the provisions of this
Agreement, regarding further payment of base salary, incentives, and
vesting and exercisability of options and other benefits constitute fair
and reasonable provisions for the consequences of such termination, do not
constitute a penalty, and such payments and benefits shall not be limited
or reduced by amounts the Executive might earn or be able to earn from any
other employment or ventures during the remaining period of the Agreement.
Executive shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise.
19. BINDING AGREEMENT
This Agreement shall be binding upon and inure to the benefit of the
Executive, his heirs, distributees and assigns, and the Company, its
successors and assigns. Executive may not, without the expressed written
consent of the Company, assign or pledge any rights or obligations
hereunder to any person, firm or corporation. If the Executive should die
while any amounts would still be payable to the Executive had he continued
to live, all such amounts, unless otherwise provided herein, shall be paid
in accordance with this Agreement to the Executive's estate, or to his
Beneficiaries, if such beneficiary designation is so provided.
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20. NO ATTACHMENT
Except as required by law or with the consent of the Company or by laws of
descent and distribution or permitted designation, no right to receive
payments under this Agreement shall be subject to anticipation,
commutation, alienation, sale, assignment, encumbrance, charge, pledge or
hypothecation or to execution, attachment, levy or similar process or
assignment by operation of law, and any attempt, voluntary or involuntary,
to effect any such action shall be null, void and of no effect.
21. ASSIGNMENT
Company shall require any successor (whether direct or indirect, by
operation of law, 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. Failure of the Company to obtain such
assumption and agreement prior to the effectiveness of any such succession
shall, at Executive's election, be deemed a material breach of this
Agreement. In such event, the Executive shall be entitled to a compensation
equal to the greater of the benefit payable pursuant to Section 15.5 or
Section 16.4. As used in this Agreement, "Company" shall mean the Company
as defined above 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.
22. WAIVER
No term or condition of this Agreement shall be deemed to have been waived,
nor shall there be any estoppel against the enforcement of any provision of
this Agreement, except by written instrument of the party charged with such
waiver or estoppel. No such written waiver shall be deemed a continuing
waiver unless specifically stated therein, and each such waiver shall
operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any
act other than that specifically waived.
23. NOTICE
For purposes of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to
have been duly given when personally delivered and acknowledged or
delivered by United States registered mail, return receipt requested,
addressed, in the case of the Executive to the Executive at: Xxxxxx X.
Xxxxxxx at his then current primary residence, as the Company may, from
time to time be notified, with a copy to Xxxxxxx Xxxx, Xxxx Financial
Management, 0000 Xxxxxxxxx Xx., N.E., 000 Xxxxxxx Xxxxx, Xxxxxxx,
00
XX 00000, and in the case of the Company, to the attention to the Corporate
Secretary of the Company at the principal executive offices of the Company,
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notice of a change of address
shall be effective only upon receipt.
24. GOVERNING LAW
This Agreement shall be governed and construed in accordance with the laws
of the State of Nevada.
25. COSTS
The Company shall pay up to $7,000 of the expenses of the Executive,
including attorneys' and consultant fees for negotiation and preparation of
the Agreement, in addition to the Company's own expenses in connection
there with.
26. SEVERABILITY
If, for any reason, any provision of this Agreement is held invalid, such
invalidity shall not affect any other provision of this Agreement not held
so invalid, and each such other provision shall to the full extent
consistent with the law continue in full force and effect. If any provision
of this Agreement shall be held invalid in part, such invalidity shall in
no way affect the rest of such provision not held so invalid, and the rest
of such provision, together with all other provisions of this Agreement
shall to the full extent consistent with the law continue in full force and
effect.
27. ARBITRATION
27.1 Any disagreement, dispute, controversy or claim arising out of or in
any way related to this Agreement or the subject matter hereof or the
interpretation hereof or any arrangements relating hereto or
contemplated herein or the breach, termination or invalidity hereof or
the provision or failure to provide for any other benefits on a Change
of Control pursuant to any other bonus or compensation plans, stock
option plan, stock ownership plan, stock purchase plan, life insurance
plan or similar plan or agreement with the Company and or an Affiliate
as "change of control" may be defined in such other agreements or
plans, which benefits constitute "Parachute Payments" shall be settled
exclusively and finally by arbitration. If this Section 27 conflicts
with any provision in any such plan or agreement, this provision
requiring arbitration shall control.
27.2 Arbitration shall be conducted in accordance with the Commercial
Arbitration Rules (the "Arbitration Rules") of the American
Arbitration Association. The arbitration tribunal shall consist of
three arbitrators, one
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chosen by the Company, one chosen by the Executive and one chosen by
the preceding two persons.
27.3 The parties shall equally divide all costs of arbitration but the
parties shall bear their own expenses for attorney's fees and witness
costs, unless such fees and costs are assessed by the Arbitrator as
part of his or her final judgment.
27.4 The arbitration shall be conducted in Orlando, FL or in any other city
in the United States of America as the parties to the dispute may
designate by mutual written consent.
27.5 Any decision or award of the arbitration tribunal shall be final and
binding upon the parties to the arbitration proceeding. The parties
hereto hereby waive, to the extent permitted by law, any rights to
appeal or review such award by any court or tribunal. The parties
hereto agree that the arbitration award may be enforced against the
parties to the arbitration proceeding or their assets wherever the
award may be entered in any court having jurisdiction thereof.
27.6 The parties stipulate that discovery may be held in any such
arbitration proceeding as provided in the Florida Code of Civil
Procedure, as may be amended from time to time.
28. ENTIRE AGREEMENT
As of the Effective Date this Agreement contains the full understanding of
the parties hereto. This Agreement may not be changed orally, but only by
an agreement, in writing, signed by the party against whom enforcement of
any waiver, change, modification, extension or discharge is sought.
EXECUTIVE COMPANY
AIR XXXX HOLDINGS, INC.
/s/ Xxxxxx X. Xxxxxxx By: /s/ [SIGNATURE ILLEGIBLE]^^
------------------------- ---------------------------
Xxxxxx X. Xxxxxxx Title DIRECTOR
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