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Exhibit 10.20
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "AGREEMENT") is
dated as of December 20, 1996, between First Aviation Services Inc., a Delaware
corporation (the "COMPANY"), and Xxxxxxx X. Xxxxxx, an individual (the
"EXECUTIVE").
WITNESSETH:
WHEREAS, the Company believes that the Executive is a valued
employee of the Company and wishes to ensure his continued employment with the
Company and document the terms of the Executive's employment by the Company.
WHEREAS, the Company also has determined that it is in the
best interests of the Company and its shareholders to reinforce and encourage
the continued attention and dedication of certain key members of the Company's
management, including the Executive, to their assigned duties without
distraction in uncertain circumstances arising from the possibility of a change
in control of the Company.
NOW, THEREFORE, taking into account the foregoing and in
consideration of the mutual promises and conditions contained herein, the
parties hereto agree as follows:
ARTICLE I
EMPLOYMENT
1.1 Employment. The Company employs the Executive and the
Executive hereby accepts employment as the Chief Executive Officer of the
Company and as the Chief Executive Officer of Aircraft Parts International,
Xxxxx ("API"), which is a wholly-owned subsidiary of the Company, upon the terms
and conditions hereinafter set forth.
1.2 Term. The employment of the Executive by the Company under
the terms and conditions of this Agreement will commence on the date hereof and
continue, subject to Article IV hereof, for a period of three years ("EMPLOYMENT
TERM").
1.3 Executive Duties. As the Company's Chief Operating Officer
and as API's Chief Executive Officer, the Executive shall perform such duties as
are requested by and shall report directly to the Company's Board of Directors.
The Executive agrees to devote his full business time (with allowances for
vacations and sick leave) and attention and best efforts to the affairs of the
Company and its subsidiaries and affiliates
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during the Employment Term, except that Executive shall be permitted to continue
his affiliation with, and work for, First Equity Development, Inc. so long as
such affiliation and work does not, in any material way, interfere with
Executive's duties as an officer of both the Company and API. Executive shall
not, while an employee of the Company, directly or indirectly, be engaged
(including as a stockholder, proprietor, general partner, limited partner,
trustee, consultant, employee, director, officer, lender investor or otherwise)
in any business or activity that is competitive with that of the Company or any
of its subsidiaries.
ARTICLE II
COMPENSATION AND BENEFITS
2.1 Annual Salary. During the Employment Term, the Company
shall pay to the Executive a base salary at the rate of One Hundred Eighty
Thousand Dollars ($180,000) per year (the "ANNUAL SALARY"), payable in
substantially equal biweekly installments. The Company will review annually and
may, in the sole discretion of the Board of Directors, increase such base salary
in light of the Executive's performance, inflation in cost of living or other
factors.
2.2 Benefits. During the Employment Term, the Executive shall
be eligible for participation in and covered by any and all such performance,
bonus, profit sharing, incentive, stock option, and other compensation plans and
such medical, dental, disability, life, and other insurance plans and such other
benefits generally available to other employees of the Company in similar
employment positions, on the same terms as such employees, subject to meeting
applicable eligibility requirements (collectively referred to herein as the
"COMPANY BENEFIT PLANS").
2.3 Reimbursement of Expenses. The Executive shall be entitled
to receive prompt reimbursement of all reasonable expenses incurred by the
Executive in performing services hereunder, including all reasonable expenses of
travel, entertainment and living expenses while away from home on business at
the request of, or in the service of, the Company or API, provided that such
expenses are incurred and accounted for in accordance with the policies and
procedures established by the Company.
2.4 Vacation and Holidays. The Executive shall be entitled to
an annual vacation leave of three (3) weeks at full pay or such greater vacation
benefits as may be provided for by the Company's vacation policies applicable to
senior executives of the Company. Up to a maximum of one week of vacation time
may be accumulated and carried over from one year to the next. Executive shall
be entitled to such holidays as are established by the Company for all
employees.
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ARTICLE III
CONFIDENTIALITY AND NONDISCLOSURE
3.1 Confidentiality. Executive shall not, during Executive's
employment by the Company or thereafter, at any time disclose, directly or
indirectly, to any person or entity or use for Executive's own benefit any trade
secrets or confidential information relating to either the Company's or API's
business, operations, marketing data, business plans, strategies, employees,
negotiations and contracts with other companies, or any other subject matter
pertaining to the business of either the Company or API or any of their
respective clients, customers, consultants, or licensees, known, learned, or
acquired by Executive during the period of Executive's employment by the Company
(collectively "CONFIDENTIAL INFORMATION"), except as may be necessary in the
ordinary course of performing Executive's particular duties as an employee of
the Company.
3.2 Return of Confidential Material. Executive shall promptly
deliver to the Company on termination of Executive's employment by the Company,
whether or not for Cause and whatever the reason, or at any time the Company may
so request, all memoranda, notes, records, reports, manuals, drawings,
blueprints, rolodexes, computer files and records, Confidential Information and
any other documents of a confidential nature belonging to either the Company or
API, including all copies of such materials which Executive may then possess or
have under Executive's control. Upon termination of Executive's employment by
the Company, Executive shall not take any document, data, or other material of
any nature containing or pertaining to the proprietary information of either the
Company or API.
3.3 Prohibition on Solicitation of Customers; Noncompetition.
During the term of Executive's employment by the Company, and for a period of
six months thereafter, Executive shall not, directly or indirectly, either for
Executive or for any other person or entity, solicit any person or entity to
terminate such person's or entity's contractual and/or business relationship
with either the Company or API, nor shall Executive interfere with or disrupt or
attempt to interfere with or disrupt any such relationship. In addition, for a
period of six months following the term of Executive's employment by the
Company, Executive shall not, directly or indirectly, be engaged (including as a
stockholder, proprietor, general partner, limited partner, trustee, consultant,
employee, director, officer, lender investor or otherwise) in any business or
activity as of the date of termination of employment that is competitive with
that of the Company or any of its subsidiaries activities within the United
States. None of the foregoing shall be deemed a waiver of any and all rights and
remedies the Company may have under applicable law.
3.4 Prohibition on Solicitation of Employees, Agents or
Independent Contractors After Termination. During the term of Executive's
employment by the Company and for a period of six months following the
termination of Executive's
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employment by the Company, Executive will not solicit any of the employees,
agents, or independent contractors of either the Company or API to leave the
employ of the Company or API for a competitive company or business. However,
Executive may solicit any employee, agent or independent contractor who
voluntarily terminates his or her employment with either the Company or API
after a period of 120 days have elapsed since the termination date of such
employee, agent or independent contractor. None of the foregoing shall be deemed
a waiver of any and all rights and remedies the Company may have under
applicable law.
3.5 Right to Injunctive and Equitable Relief. Executive's
obligations not to disclose or use Confidential Information and to refrain from
the solicitations described in this Article III are of a special and unique
character which gives them a peculiar value. The Company cannot be reasonably or
adequately compensated for damages in an action at law in the event Executive
breaches such obligations. Therefore, Executive expressly agrees that the
Company shall be entitled to injunctive and other equitable relief without bond
or other security in the event of such breach in addition to any other rights or
remedies which the Company may possess or be entitled to pursue. Furthermore,
the obligations of Executive and the rights and remedies of the Company under
this Article III are cumulative and in addition to, and not in lieu of, any
obligations, rights, or remedies created by applicable law relating to
misappropriation or theft of trade secrets or Confidential Information.
3.6 Survival of Obligations. Executive agrees that the terms
of this Article III and Article V hereof shall survive the term of this
Agreement and the termination of Executive's employment by the Company.
ARTICLE IV
TERMINATION
4.1 Definitions. For purposes of this Article IV, the
following definitions shall be applicable to the terms set forth below:
(a) Cause. "CAUSE" shall mean only the following: (i)
failure by the Executive to perform his duties hereunder or
those duties which may, from time to time, be reasonably
requested by the Board of Directors of the Company (other than
such failure resulting from the Executive's incapacity due to
physical or mental illness); (ii) misconduct by the Executive
which is materially injurious to the Company; (iii) conviction
of or pleading no contest to a felony or other crime of moral
turpitude; (iv) habitual drunkenness by the Executive; (v)
action by the Executive beyond the scope of his employment, as
such scope is set by the Board of Directors of the Company or
API from time to time (vi) a material breach of this Agreement
by the Executive.
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(b) Disability. "DISABILITY" shall mean a physical or
mental incapacity as a result of which the Executive becomes
unable to continue the proper performance of his duties
hereunder (reasonable absences because of sickness for up to
three (3) consecutive months excepted). A determination of
Disability shall be subject to the certification of a
qualified medical doctor agreed to by the Company and the
Executive or, in the event of the Executive's incapacity to
designate a doctor, the Executive's legal representative. In
the absence of agreement between the Company and the
Executive, each party shall nominate a qualified medical
doctor and the two doctors so nominated shall select a third
doctor, who shall make the determination as to Disability.
4.2 Termination by Company. The Executive's employment
hereunder may be terminated by the Company immediately for Cause. Subject to the
other provisions contained in this Agreement, the Company may terminate this
Agreement for any reason other than Cause upon thirty (30) days' written notice
to Executive. The effective date of termination ("EFFECTIVE DATE") shall be
considered to be thirty (30) days subsequent to written notice of termination;
however, the Company may elect to have Executive leave both the Company and API
immediately.
4.3 Severance Benefits Received Upon Termination.
(a) If at any time the Executive's employment is
terminated by the Company for Cause, the Company shall pay the
Executive his base salary through the end of the month during
which such termination occurs (or at the Executive's election,
the rate in effect on the first day of the month preceding the
month in which the date of termination occurs) plus credit for
any accrued vacation and the Company shall thereafter have no
further obligations under this Agreement to the Executive or
his or her dependents, beneficiaries or estate; provided,
however, that the Company will continue to honor any
obligations that may have been accrued under then existing
Company Benefit Plans or any other agreements or arrangements
applicable to the Executive.
(b) If at any time the Executive's employment is
terminated by the Company without Cause or as a result of
death or Disability, then the Company shall:
(1) pay to the Executive within seven days
following the date of termination the pro rata share
of his "MONTHLY BASE SALARY" (defined as the result
of (i) the Annual Salary divided by (ii) twelve (12))
in effect on the date of the termination through the
end of the month during which such termination
occurs, plus payment for any vacation earned but not
taken;
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(2) pay to the Executive for termination of
his rights thereunder a lump sum, in cash, within
seven business days following the date of
termination, an amount equal to six months salary
based upon the Executive's current Monthly Base
Salary; and
(3) provide Executive with such insurance
coverage as is then required by COBRA or any similar
then applicable law.
4.4 No Obligation to Mitigate Damages; No Effect on Other
Contractual Rights.
(a) The Executive shall not be required to mitigate
damages or the amount of any payment provided for under this
Agreement by seeking other employment or otherwise, nor shall
the amount of any payment provided for under this Agreement be
reduced by any compensation earned by the Executive as the
result of employment by another employer after the date of
termination, or otherwise.
(b) The provisions of this Agreement, and any payment
or benefit provided for hereunder, shall not reduce any
amounts otherwise payable, or in any way diminish the
Executive's existing rights, or rights which would accrue
solely as a result of the passage of time, under any Company
Benefit Plan, employment agreement or other contract, plan or
arrangement.
(c) Executive may terminate this Agreement upon 30
days written notice to the Company and upon such termination
the Company shall make the payment provided for in Section
4.3(b)(1) hereof and no further payments shall be required to
be made by the Company to Executive.
ARTICLE V
GENERAL PROVISIONS
5.1 Notice. For purposes of this Agreement, notices and all
other communications provided for in the Agreement shall be in writing and shall
be deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, as follows:
If to the Company: First Aviation Services Inc.
Xxx Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxxxx, Chairman
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If to the Executive: Xx. Xxxxxxx X. Xxxxxx
First Aviation Services Inc.
Xxx Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
or such other address as either party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
5.2 No Waivers. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by the Executive and the Company. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.
5.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Connecticut without regard
to conflicts of law principles. Executive hereby agrees to submit to the
exclusive jurisdiction of the courts in and of the State of Connecticut, and
consents that service of process with respect to all courts in and of the state
of Connecticut may be made by registered mail to Executive at his address for
notices specified herein.
5.4 Severability or Partial Invalidity. The invalidity or
unenforceability of any provisions of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement, which shall
remain in full force and effect.
5.5 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.
5.6 Legal Fees and Expenses. Should any party institute any
action or proceeding to enforce this Agreement or any provision hereof, or for
damages by reason of any alleged breach of this Agreement or of any provision
hereof, or for a declaration of rights hereunder, the prevailing party in any
such action or proceeding shall be entitled to receive from the other party all
costs and expenses, including reasonable attorneys' fees, incurred by the
prevailing party in connection with such action or proceeding.
5.7 Entire Agreement. This Agreement constitutes the entire
agreement of the parties and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings, and negotiations between the
parties with respect to the subject matter hereof. This Agreement is intended by
the parties as the final expression of their agreement with respect to such
terms as are included in this
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Agreement and may not be contradicted by evidence of any prior or
contemporaneous agreement. The parties further intend that this Agreement
constitutes the complete and exclusive statement of its terms and that no
extrinsic evidence may be introduced in any judicial proceeding involving this
Agreement.
5.8 Assignment. Subject to the provisions of Article V hereof,
this Agreement and the rights, duties, and obligations hereunder may not
assigned or delegated by any party without the prior written consent of the
other party. Notwithstanding the foregoing provisions of this Section 5.8, the
Company may assign or delegate its rights, duties, and obligations hereunder to
any person or entity which succeeds to all or substantially all of the business
of the Company through merger, consolidation, reorganization, or other business
combination or by acquisition of all or substantially all of the assets of the
Company; provided that such person assumes the Company's obligations under this
Agreement in accordance with Section 5.1.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
FIRST AVIATION SERVICES INC.,
a Delaware corporation
By: /s/ XXXX X. XXXXXXXXX
_________________________________
Title: Chief Financial Officer
Xxxxxxx X. Xxxxxx,
an individual
/s/ XXXXXXX X. XXXXXX
____________________________________
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