EXHIBIT 10.39
AGREEMENT, dated as of October 1, 1996, between Trans World Airlines, Inc.
("Company"), and Xxxxxxx X. Xxxxxxx ("Executive");
WHEREAS, the Company's Board of Directors has determined that it is in the
best interest of the Company and its Shareholders, in order to assure continuity
in the management of the Company and to provide certain additional benefits to
the Company pursuant to the additional undertakings by you hereinafter set
forth, to amend and restate your existing employment agreement with the Company
by entering into this Agreement with you pursuant to which you and the Company
give certain contractual undertakings each to the other, and
WHEREAS, the parties desire to set forth the entirety of their agreements and
understandings;
NOW, THEREFORE, in consideration of the mutual promises contained herein
the parties agree as follows:
1. Employment. The Company hereby agrees to continue the employment of
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the Executive to render the service hereinafter described and the Executive
hereby accepts such employment and agrees to render such services, upon and
subject to the terms and conditions described in this Agreement.
2. Term. Executive's employment will continue for an indefinite period
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until terminated at any time by Company or Executive with or without cause.
Nothing in this Agreement or otherwise shall be construed as entitling Executive
to employment for any definite term.
3. Duties.
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(a) Executive shall serve at the pleasure of the Company in such
executive positions as Executive shall be assigned from time to time by the
President, and shall perform such executive, advisory and/or administrative and
managerial assignments and duties as may be assigned to Executive from time to
time by the President or the President's designee, all according to the
direction and control of the President. Executive will carry out and perform all
such duties and assignments and all directions of any officer to whom Executive
directly or indirectly reports. Executive also will comply with and carry out
all rules and policies of the Company, and will serve, without additional
compensation, as an officer and/or director or any subsidiary, affiliated or
related corporation or business, or of any company in which Company may hold any
interest.
(b) The Executive will, on any exclusive basis, devote his full time
during normal business hours to the business and affairs of the Company and use
his best efforts to promote the interests of the Company and to perform
faithfully and efficiently the responsibilities assigned to Executive in
accordance with the terms of this Agreement.
4. Compensation and Other Terms of Employment. During the period in which
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Executive is employed by Company, the Executive shall receive the following:
(a) Salary. The Executive will continue to be paid at his current annual
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rate of pay on a regular basis, not less frequently than one time per month, on
a regular Company pay day. This rate of pay ("Base Salary") is subject to
adjustment from time to time, and will be reviewed on a regular basis. All such
payments will be subject to withholding for taxes and amounts owed by the
Company, if any.
(b) Stock Incentive Plan. The Executive continues to be eligible to
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participate in the Company's Key Employee Stock Incentive Plan ("KESIP"). The
Executive's current grant of shares is subject in its entirety to the terms
and conditions set forth in the KESIP Agreement between the Executive and the
Company. To the extent that there is any inconsistency between the terms and
conditions of this Agreement and those of the KESIP, the terms and conditions of
this Agreement shall control.
(c) Passes. The Executive and his eligible family members will be
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entitled to card-type Class 1 "term" passes on the Company's routes worldwide.
(e) Medical, Dental, Insurance and Accident Insurance. (i) The Executive
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and his eligible dependents will be eligible to participate in the Company-paid
comprehensive Medical and Dental Plan and the Travel Accident Insurance Program
offered by the Company, on the same terms and conditions applicable to other
officers. (ii) The Executive will be eligible for coverage under the Company's
Group Term Life Insurance Plan under the Company currently provides Basic Life
Insurance of $50,000 at no cost to the Executive. Assuming that the Executive is
insurable at standard rates, the Executive will also have the option to purchase
Additional Group Life Insurance in an amount up to three times the Executive's
Base Salary, less the Basic $50,000 coverage. The monthly cost of this
Additional Life Insurance is currently $4.50 per $10,000 and such monthly cost
may increase from time-to-time. (iii) The Executive will be eligible to
participate in the Company's Voluntary Personal Accident Insurance Plan. The
maximum coverage for this plan is currently $150,000 at a monthly cost of $6.60
and such monthly cost may increase from time-to-time. (iv) The Executive will be
covered for Long-Term Disability protection pursuant to plan provisions at
standard rates and subject to standard conditions. Nothing herein shall be
construed to prevent the Company from amending or altering any such plans or
programs set forth herein so long as the Executive continues to have the
opportunity to receive in the aggregate benefits at a level no less favorable
than those set forth herein.
5. Vacation. The Executive will be eligible for 3 weeks vacation.
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6. Termination of Employment.
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(a) Death. This Agreement shall terminate automatically upon the
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Executive's death. All benefits and compensation then accrued hereunder, and
under any related plans, shall be paid when due to the Executive's beneficiaries
or legal representatives, as appropriate.
(b) Termination Without Cause. The Company shall have the right to
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terminate the Executive's employment without cause at any time and without
advance notice. In
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such event the Company shall pay to the Executive an amount equal to the
Executive's then rate of annual Base Salary and any accrued, earned unpaid
salary and unused vacation as of the effective date of such termination. Such
payment (other than accrued, earned salary and unused vacation) may be made at
the Company's option in a single lump sum or in equal installments payable over
up to a twelve month period. Upon the making of such payments, the Company
shall have no further obligation to the Executive under this Agreement and
Executive accepts such payments in full satisfaction of all claims against the
Company.
(c) Termination For Cause. The Company shall have the right to
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terminate the Executive's employment at any time and without advance notice for
Cause. For the purposes of this Agreement, "Cause" shall mean that (i) the
Executive is convicted of or engages in conduct which constitutes a felony, or a
misdemeanor involving moral turpitude; or (ii) the Executive is found by the
Company's Board of Directors to have willfully engaged in conduct which is
demonstrably and materially injurious to the Company; or (iii) the Executive is
found by the Company's Board of Directors to have failed or refused to in any
material respect to competently perform his duties and responsibilities (after
notice and opportunity to cure if such material failure or refusal can be
cured); or (iv) the Executive has breached his duty of loyalty to, or committed
any act of fraud, theft or dishonesty against or involving, the Company or any
of its affiliated companies; or (v) the Executive has breached any provision of
this Agreement. If the Executive's employment is terminated for Cause, the
Company shall pay the Executive his unpaid, accrued salary through the date of
such termination at the rate in effect at the time of such termination and any
accrued, earned or unused vacation through the effective date of such
termination. Upon the making of such payment, the Company shall have no further
obligation to the Executive under this Agreement.
(d) Termination by the Executive. If the Executive voluntarily
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terminates his employment, the Executive must give the Company thirty (30)
calendar days advance notice in writing. If the Executive fails to do so, the
Executive shall not be entitled to any accrued rights and benefits to which the
Executive might be entitled under this or any related agreement and the Company
will have no further obligation to the Executive except for unpaid salary earned
by the Executive up to and including the effective date of such termination.
Upon termination of employment and otherwise upon demand, Executive will
turn over to Company all Company property and documents and all computer
passwords, and will (after copying the same to 3.5 disks and returning the disks
to the Company) delete all Company information from any computer which is not
Company property. Upon termination, all benefits and compensation ceases except
as described above.
7. Termination Obligations. The Executive agrees that during his
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employment and following his termination under any of the circumstances set
forth herein:
(a) he shall not during his employment or for a period of two years
following the effective date of his termination, directly or indirectly solicit
(or assist or encourage the solicitation of) any employee of the Company or any
of its subsidiaries or affiliated companies to be employed by the Executive or
by any entity in which the Executive owns or expects to own
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any equity interest in excess of five (5) percent of any class of the
outstanding securities thereof, or by any entity by which the Executive is
employed or for which the Executive serves or expects to serve in any capacity;
nor (after his employment ends and during such 2 year period) encourage or
induce any Company employee to terminate his or her Company employment. For the
purposes of this paragraph, the term "solicit" shall mean any contact by the
Executive with or providing information to others who may be expected to contact
any employees of the Company or of any of its subsidiaries or affiliated
companies regarding their employment status, job satisfaction, interest in
seeking employment with the Executive, with any person affiliated with the
Executive or by whom the Executive is employed but shall not include print
advertising for personnel or responding to any unsolicited request for a
personal recommendation for or evaluation of a Company employee or an employee
of any of the Company's subsidiaries or affiliated companies.
(b) he shall hold forever hereafter in a fiduciary capacity for the
benefit of the Company all secret or confidential information, knowledge or data
relating to the Company or any of its subsidiaries or affiliated companies,
including but not limited to commercial, operational, marketing, pricing, or
financial information including costs, strategies, forecasts or trade secrets,
acquisition strategies or candidates or personnel acquisition plans
("confidential information") which shall have been obtained by the Executive
during or by reason of his employment by the Company or by any of its
subsidiaries or affiliated companies and which shall not be public knowledge.
During and after the end of the term of employment, the Executive shall not,
without the prior written consent of the Company or unless required to do so by
reason of a court order or subpeona (in which case Executive shall give Company
prompt notice of any such other subpeona or order, or request therefore, so as
to provide Company the maximum opportunity to contest the same), communicate or
divulge any such confidential information to anyone other than the Company or
those designated by it, except that while employed by the Company in the
business of and for the benefit of the Company the Executive may provide
confidential information as appropriate to those persons who in the Executive's
judgment have a need to know such confidential information.
(c) he shall not for a period of two years following the effective
date of his termination discuss or disclose to the media or Company personnel
the circumstances or terms of his termination of employment.
(d) he shall not publicly disparage or denigrate the Company or any
of its officers, directors or practices.
To the extent that any covenant or agreement contained in this Section 7
shall be determined by a Court to be invalid or unenforceable in any respect or
to any extent, the covenant or agreement shall not be rendered void, but instead
shall be automatically amended to such lesser scope or to such lesser extent as
will grant Company the maximum restriction on Executive's conduct and activities
permitted by applicable law in such circumstances.
8. No Assignment. This Agreement is personal to the Executive and
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without the Company's prior written consent it shall not be assignable by the
Executive other than by will or
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the laws of descent and distribution. This Agreement shall inure to the benefit
of and be enforceable by the legal representatives of Executive's estate, and
otherwise is freely assignable by Company.
9. Assistance. For a period of three (3) years following termination of
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employment, Executive will, upon reasonable notice, make himself available for
consultation with Company counsel, to meet with Company counsel and prepare to
testify as a witness or deponent, and to testify as a witness at a trial,
deposition or proceeding, concerning any legal matter involving or affecting the
Company. The Company will pay for all reasonable and necessary out of pocket
travel and telephone costs and expense incurred by Executive in connection with
any such activity.
10. Miscellaneous.
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(a) This Agreement shall be governed by and be construed in
accordance with the internal laws of the State of Missouri, without reference to
principles of conflicts of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. Neither this Agreement
nor any of its terms may be amended, waived, added to or modified other than by
written agreement executed by the parties hereto or their respective successors
and legal representatives.
(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by regular or
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Executive:
Xxxxxxx X. Xxxxxxx
One City Centre
000 Xxxxx 0xx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
If to the Company:
Trans World Airlines, Inc.
One City Centre
000 Xxxxx 0xx Xxxxxx
Xx Xxxxx, Xxxxxxxx 00000
Attn: General Counsel
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.
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(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) This Agreement contains the entire understanding between the
parties concerning the subject matter hereof and supersedes all prior
agreements, understandings, discussions, negotiations and undertakings, whether
written or oral, among the parties with respect thereto. The terms of any
employee manual, handbook, or any policy of the Company, shall not modify,
alter, or invalidate any term of this Agreement nor alter Employee's at will
status, and in case of any conflict between a term of this Agreement and any
such policy, handbook or manual, the terms of this Agreement control, except for
benefit plans and Stock option awards described herein (to the extent not
otherwise provided in this Agreement).
(e) Executive represents that or he is not a party to any agreement,
or under any legal obligation, which could preclude or in any way impair
Executive's performance of Executive's duties for Company. Executive has not
provided, and will not provide, to Company any trade secret of another person
whose secrecy he is obligated to maintain.
(f) Notwithstanding any provision hereof to the contrary, nothing in
this Agreement shall be deemed to entitle the Executive to employment beyond the
Term hereof.
IN WITNESS WHEREOF, the Company has caused this Agreement to be signed in its
corporate name, and the Executive has hereunto set his hand, all as of the day
and year first above written.
/s/ Xxxxxxx X. Xxxxxxx
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XXXXXXX X. XXXXXXX
/s/ Xxxxxxx X. Magumo
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TRANS WORLD AIRLINES, INC.
By: /s/ Xxxxxxx X. Magumo
Sr. V.P. Legal
