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EXHIBIT 10.21
FORM OF EMPLOYMENT AGREEMENT
1.0 PARTIES AND DATE
1.1 PARTIES. The parties to this Employment Agreement are American
International Airways, Inc. ("AIA") and Xxxxxx Xxxxxxx ("Employee").
1.2 DATE. This Agreement is dated and effective September ____, 1997.
2.0 TERMS OF EMPLOYMENT
2.1 CURRENT EMPLOYMENT STATUS. Employee is currently employed by
American International Airways, Inc. ("AIA") as its Chief Executive Officer.
Employee's current employment status has been as an employee at the will of AIA
and his employment has been terminable with or without cause. Similarly,
Employee has enjoyed the right to terminate his employment, at his will at any
time, with or without cause.
2.2 PURPOSE OF THIS AGREEMENT. AIA wishes to continue to employ
Employee as its Chief Executive Officer. Given the position of responsibility
occupied by Employee at AIA, it is the opinion of AIA that Employee is entitled
to an increased degree of financial security with regard to his employment.
While the status of Employee's employment is still at the will of AIA and is
still terminable with or without cause, this Agreement is intended to: (a)
relieve Employee of some of the concerns relating to the potential termination
of his employment which are inherent in his position; (b) allow for compensation
if Employee's employment is involuntarily terminated; and (c) demonstrate AIA's
confidence that it will continue to be satisfied with Employee's performance.
2.3 EMPLOYEE'S DUTIES AND RESPONSIBILITIES. AIA shall continue to
employ Employee as its Chief Executive Officer until termination of his
employment Agreement under Paragraph 2.09 or 2.10. Employee shall be granted the
authority and responsibility to perform those functions which are encompassed by
the position of Chief Executive Officer, subject to modification, from time to
time, by the Board of Directors of AIA or the Board of Directors of any
corporate parent of AIA. Both employee and AIA expect Employee's responsibility,
authority and compensation to be dynamic, and to be adjusted from time to time
as determined by AIA's Board of Directors, or the Board of Directors of any
corporate parent of AIA.
2.4 COMPENSATION. Employee's initial basic annual compensation ("basic
annual compensation") under this Agreement shall not be less than $600,000.00,
payable in equal bi-weekly installments, but his basic annual compensation may
be adjusted from time to time but shall in no event be less than $600,000.00 per
annum. Employee will be entitled to the benefits of any existing available
Annual Incentive Compensation Plan as is in effect from time to time, and he may
be paid other bonus compensation from time to time based upon his performance
and the success of AIA, all as determined by AIA's Board of Directors, or the
Board of Directors of any corporate parent of AIA.
2.5 EMPLOYEE STOCK PURCHASE PLAN. In further consideration of
Employee's promises and employment under this Agreement, Employee shall, as part
of his compensation, be entitled to the benefits of any Employee Stock Purchase
Plan as may exist at any time in the corporation.
2.6 FRINGE BENEFITS. Employee shall receive long-term disability
insurance and any
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other employee fringe benefits that are generally available to
all AIA employees, subject to any eligibility requirements of such plan(s), and
such other fringe benefits as may be determined from time to time by the AIA's
Board of Directors, or the Board of Directors of any corporate parent of AIA.
2.7 PROPRIETARY INFORMATION.
A. Employee has had and will have extensive access to and use
of, and has played and will play a material role in
developing the confidential business and proprietary
information of AIA and its customers, and AIA's confidential
business practices and procedures and may have access to the
confidential business practices and procedures of AIA's
affiliated companies (collectively, "AIA's proprietary
information"). AIA's proprietary information includes but is
not limited to dynamic data bases concerning air cargo
aircraft in charter service and suppliers of ground handling
and delivery services, customer lists and agreements, vendor
lists, employee data, competitor data, price and tariffs
lists, bids and quotations, aircraft use and maintenance
scheduling procedures, phone lists, computer programs,
documents, letters, memoranda, financial information,
commission arrangements and other specialized and
confidential business arrangements and practices. AIA relies
upon its proprietary information for competitive advantage
in their markets. Unauthorized disclosure, copying,
destruction or removal of AIA's proprietary information, or
its use for the benefit of AIA's competitors, could severely
and irreparably damage AIA and its affiliates.
B. Employee shall, while in AIA's employ, diligently safeguard
AIA's proprietary information; and when leaving AIA's
employment for whatever reason, shall surrender to AIA all
written or recorded evidence of AIA's proprietary
information in Employee's possession.
C. After leaving AIA's employment for whatever reason, Employee
shall never disclose AIA's proprietary information unless
AIA's then-current chief executive officer expressly
authorizes the disclosure in writing.
2.8 COVENANT NOT TO COMPETE. To further protect AIA's proprietary
information, Employee agrees that upon termination of his employment with AIA
for whatever reason, Employee shall not engage in the air cargo charter
management, or charter brokerage business, or in the business of ad hoc or
scheduled carriage of air freight under FAA Part 121 or Part 135 certificate,
within the United States for three years following such termination, either
directly or indirectly, whether as an employee, agent, consultant, broker,
partner, principal or otherwise. Employee further waives and releases any future
claim against AIA for attempting to enforce Employee's covenant not to compete
if AIA does so in the good faith belief that the covenant is enforceable and
that Employee has breached or contemplates breaching it. However, Employee may
engage in the business of purchasing, selling and/or leasing of aircraft.
Employee is the owner of a company known as ConWes, Inc. which is in partnership
with a company known as National Aircraft Services, Inc. which owns an STC. The
STC involves the removal of turbo compressors and replaces them with a control
valve system. Employee may continue to be engaged in the marketing and
manufacture of his current interest in this STC, and Employee may continue or
institute the development of any other STC of whatever application, whether for
ConWes or for another entity.
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2.9 TERMINATION. Either Employee or AIA may terminate Employee's
employment immediately at the terminating party's pleasure, and AIA shall pay to
Employee all compensation due through the pay period during which such
termination occurs. Upon the termination of Employee's employment, whether at
his own election or at the election of AIA, Employee shall promptly return to
AIA all company property, including, but not limited to, company credit cards,
documents, customer lists, telephones, pagers, computers, computer disks and
office equipment.
2.10 DEATH OR DISABILITY. Employee's employment shall terminate
immediately upon Employee's death or disability. Termination due to Employee's
death or disability shall be deemed an involuntary severance and entitle
employee to the benefits described in Paragraph 3.4 hereof. For the purposes of
this Agreement, disability shall mean physical or mental illness resulting in
Employee's incapacity to render full-time services to the Corporation for a
total of nine (9) months in any period of twelve (12) consecutive months or
less. If Employee's termination occurs upon his death, AIA will continue to
maintain (at AIA's expense), for a period of six months pursuant to COBRA
provisions, all insurances on behalf of Employee's spouse and dependents as were
in effect on the date of Employee's death. If Employee's termination occurs upon
his disability, AIA will continue to maintain (at AIA's expense) for a period of
six (6) months all insurances pursuant to COBRA provisions on Employee's behalf
and on behalf of his spouse and his dependents as were in effect on the date of
Employee's termination due to disability. Thereafter, AIA shall have no further
obligation hereunder with regard to maintenance of insurance policies unless
applicable law otherwise so provides.
3.0 SEVERANCE
3.1 In the event Employee's employment with AIA is severed, voluntarily
or involuntarily, and Employee agrees to sign (unless Employee's termination is
due to death or disability) a Release and Severance Agreement in a form prepared
by AIA, provided that such Severance Agreement does not contradict the terms
contained herein and provided that such Severance Agreement places upon Employee
no additional material burden. Employee shall then be entitled to certain
severance payments (as set forth below) as compensation for his Release of any
and all claims he may have against AIA, its employees, officers, directors,
shareholders and assigns. In return for such compensation as is set forth (as
applicable) below, Employee (by his signature hereto) agrees to sign all
releases and confidentiality agreements that AIA may request prior to Employee's
receipt of such funds.
3.2 RELEASE AND SEVERANCE AGREEMENT. The Release and Severance
Agreement to be executed by Employee at the time his employment with AIA is
severed must include the release and waiver of all claims against AIA for any
cause of action whether founded on contract, tort, Federal, state or local
statute or regulations including, but not limited to, any claims under the
Xxxxxxx-Xxxxxx Civil Rights Act, the Michigan Handicappers Civil Rights Act, the
Occupational Safety and Health Act, the Americans with Disabilities Act, the Age
Discrimination in Employment Act, the Older Worker's Benefit Protection Act,
Title VII of the Civil Rights Act of 1964, and any discrimination on the basis
of national origin, hostile work environment, sex, race, religion, age,
handicap, marital status, height, weight, or wrongful discharge.
3.3 SEVERANCE - VOLUNTARY. In the event Employee chooses to terminate
his employment with AIA and executes all releases and confidentiality agreements
which AIA may request, Employee shall be eligible to receive severance
compensation equivalent to one (1) month's pay.
Both AIA and Employee acknowledge that Employee is not otherwise entitled to the
such compensation and that such severance compensation is in consideration of
Employee's voluntary and willing execution
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of any and all releases and confidentiality agreements which AIA may request in
furtherance of the requirements set forth herein.
3.4 SEVERANCE - INVOLUNTARY. If AIA terminates his employment against the wishes
of Employee, Employee shall be entitled, as his exclusive remedy for such
termination, to three (3) years of the basic annual compensation he would have
received, payable when it would have been paid in the absence of termination on
a bi-weekly basis. Both Employee and AIA acknowledge that the severance
compensation set forth above in this paragraph 3.4 is intended to and does
reflect liquidated damages which Employee may incur by virtue of the involuntary
loss of his employment. By his signature hereto, Employee agrees to release, to
the greatest extent allowable by applicable law, any claim against AIA or their
respective officers and directors (or any corporate affiliate of AIA or their
respective officers and directors) relating to his employment or the termination
thereof. Both AIA and Employee acknowledge that Employee is not otherwise
entitled to the such compensation and that such severance compensation is in
consideration of Employee's voluntary and willing execution of any and all
releases and confidentiality agreements which AIA may request prior to
Employee's receipt of such funds.
4.0 GENERAL PROVISIONS
4.1 CONSTRUCTION. This Agreement is made and performable in Washtenaw
County, Michigan. Michigan law and the Federal Arbitration Act shall govern its
effect and construction. No rule of construction resolving ambiguity against a
drafting party shall apply. This Agreement binds and benefits the parties and
their respective heirs, personal representatives, successors and assigns. All
previous oral and written agreements, including, without limitation, any
previous employment agreement concerning Employee's employment and compensation
by AIA or any of AIA's subsidiaries are no longer effective, because they are
merged into and replaced by this Agreement. Employee agrees that his obligations
under this Agreement to protect AIA's proprietary information are in addition to
Employee's implied obligations under Michigan law, and that all of those
obligations may be enforced by equitable remedies, such as injunction, as well
as by damages resulting from their breach.
4.2 SEVERABILITY, MODIFICATION, ENTIRE AGREEMENT. Whenever possible,
each provision of this Agreement shall be interpreted in such a way as to be
effective and valid under applicable law. If a provision is prohibited by or
invalid under applicable law, it shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement. This Agreement sets forth the
entire agreement of the parties with respect to Employee's employment by AIA,
and supersedes all prior agreements, promises, covenants, arrangements,
communications representations, or warranties whether oral or written, by any
representative of either AIA or by Employee.
4.3 AMENDMENTS. To amend this Agreement, AIA and Employee must sign a
written amendment that identifies by paragraph number the provision that it
purports to amend. No noncomplying course of dealing or waiver shall be
construed to amend this Agreement.
4.4 BINDING AGREEMENT TO ARBITRATE DISPUTES. All disputes under or
relating to this Agreement shall be resolved exclusively by binding arbitration
under the Commercial Arbitration Rules of the American Arbitration Association
(the "AAA") in effect at the time the arbitration proceeding commences; except
that: (i) Paragraphs 4.1 and 4.2 will govern the effect and construction of this
agreement; (ii) the locale of any arbitration shall be Ann Arbor, Michigan,
unless otherwise mutually agreed in writing; (iii) any dispute or claim shall be
deemed waived unless arbitration is demanded within ninety (90) days of the
occurrence giving rise to the dispute or claim; (iv) the arbitrator or
arbitrators
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shall with any award supply written findings of fact and conclusions of law; (v)
a party may seek preliminary injunctive or other equitable relief from any court
of competent jurisdiction to preserve the status quo pending selection of an
arbitrator; (vi) an arbitrator may by interim or final award grant declarative
and injunctive and other equitable relief (the parties acknowledge that remedies
at law may be adequate to protect against or remedy breach of this agreement);
(vii) the decision of the arbitrator shall be final and binding and the
exclusive remedy for any alleged breach of the employment relationship; (viii)
the arbitrator shall have no authority to change any provision of this
Agreement; and (ix) a prevailing party in litigation to require arbitration or
to obtain preliminary relief pending establishment of an arbitration panel, in
arbitration, or in litigation to confirm or enforce an arbitration award will be
entitled to recover its reasonable attorneys' fees and costs. An arbitration
award will be final and binding on all parties, and judgment upon such
arbitration award may be entered in any court of competent jurisdiction.
4.5 SUCCESSORS OR ASSIGNS: This Agreement shall be binding upon all
successors and assigns of AIA, any assigns of all or substantially all of its
business, and any other corporation into which AIA may be merged or with which
it may be consolidated. This Agreement, and any rights Employee may have to
receive payments, may not be assigned or pledged by him in any manner
whatsoever.
4.6 APPLICABLE LAW. This Agreement has been executed in the State of
Michigan. This Agreement shall be governed and controlled in all respects by the
laws of the State of Michigan, including as to interpretation, enforceability,
validity, and construction (but without regard to principles of choice of law or
conflicts).
4.7 INDEMNIFICATION. AIA shall indemnify Employee, to the maximum
extent permitted by Michigan law, during and after the termination of his
employment, against all judgments, settlement payments, costs, attorney fees,
and other reasonable expenses incurred by Employee in connection with the
defense of any action, suit, or proceeding, arising from event before or during
the term of Employee's employment to which Employee has been made a party
because of the good-faith performance of his duties under this Agreement. This
right of indemnification shall be in addition to any rights that Employee may
otherwise be entitled to under the bylaws of the Corporation or otherwise.
4.8 NO SET-OFF OR COUNTERCLAIM. Employee's right to payment afforded
hereunder shall be absolute and unconditional and shall not be subject to any
right of set-off, counterclaim, defense, abatement, suspension, deferment,
diminution, reduction, recoupment or other right which AIA may have against
Employee or any other person for any reason whatsoever.
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SO AGREED:
AMERICAN INTERNATIONAL AIRWAYS, INC. EMPLOYEE
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Xxxxxxx X. Xxxxxxx Xxxxxx X. Kalitta
Vice President and C.F.O.
Dated: Dated:
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