Exhibit 10.8
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of February
11, 2002 ("Effective Date") by and between AVIATION SALES COMPANY ("AVS" or the
"Company") a Delaware corporation, and XXXX XXXXXXX (the "Employee").
RECITALS
AVS wishes to employ Employee and Employee wishes to become an employee of AVS,
on the terms and subject to the conditions of this Agreement.
In consideration of the mutual representations, warranties, covenants and
agreements contained in this Agreement, the parties hereto agree as follows:
1. Employment.
(a) Employment. AVS agrees to employ the Employee as Senior Vice
President of Business Development, and the Employee agrees to accept such
employment and serve in such position, on the terms and subject to the
conditions of this Agreement.
(b) Employment Period. The period during which the Employee shall serve
as an employee of AVS under this Agreement shall commence on the Effective Date,
and unless earlier terminated pursuant to this Agreement or extended through
agreement of the parties, shall expire on December 31, 2004 (the period for
which the Employee is an employee of AVS or its affiliates is hereinafter
referred to as the "Employment Period").
(c) Duties and Responsibilities. During the Employment Period, the
Employee shall have such authority and responsibility and perform such duties as
may be assigned to him from time to time at the direction of the Chairman, Chief
Executive Officer, President or Chief Operating Officer of AVS, and in the
absence of such assignment, such duties customary to Employee's office as are
necessary to the business and operations of AVS. During the Employment Period,
the Employee's employment shall be full time and the Employee shall perform his
duties honestly, diligently, competently, in good faith and in the best
interests of AVS and shall use his best efforts to promote the interests of AVS
and shall refer to AVS opportunities in the aerospace industry that have been
referred to Employee.
2. Compensation and Benefits.
(a) Base Salary. In consideration for the Employee's services hereunder
and the restrictive covenants contained herein, the Employee shall be paid an
annual base salary of $300,000 (the "Salary"), payable in accordance with the
AVS's customary payroll practices. Notwithstanding the foregoing, Employee's
annual Salary may be increased at anytime and from time to time to levels
greater than the level set forth in the preceding sentence at the sole
discretion of the Compensation Committee of the Board of Directors of AVS
("Committee") to reflect merit or other increases.
(b) Bonus. In addition to the Salary, the Employee shall be eligible to
receive an annual bonus ("Bonus") equal to 100% of the Employee's base Salary.
The Bonus shall be based on the achievement of corporate goals and objectives as
established by the Committee after consultation with the management of AVS. The
achievement of said goals and objectives shall be determined by the Committee.
With respect to any Fiscal Year during which the Employee is employed by the
Company for less than the entire Fiscal Year, the Bonus shall be prorated for
the period during which the Employee was so employed. The Bonus shall be payable
within thirty (30) days after the completion of the financial statements for the
particular Fiscal Year as to which the Bonus relates. The term "Fiscal Year" as
used herein shall mean each period of twelve (12) calendar months commencing on
January 1st of each calendar year during the Employment Period and expiring on
December 31st of such year.
(c) Stock Options. On the Effective Date, AVS shall issue to the
Employee a five-year option to purchase 250,000 shares of the Company's
authorized but unissued common stock at an exercise price equal to $_____ (the
last closing price of the common stock on the date on which this Agreement is
executed). The options shall vest 1/3 on date of grant, 1/3 on the first
anniversary of the Effective Date and 1/3 on the second anniversary of the
Effective Date. The Employee shall be entitled to participate and receive option
grants in the future, as may be determined by the Committee. Notwithstanding the
foregoing, Employee acknowledges that AVS is in the process of restructuring the
Company's currently outstanding debt and equity and also recapitalizing AVS. AVS
hereby agrees to adjust Employee's option grant hereunder after the completion
of the restructuring/recapitalization to provide an equivalent benefit to
Employee such that Employee is not prejudiced by the
restructuring/recapitalization. Additionally, Employee may receive in the future
additional grants of stock options at the sole discretion of the Committee.
(d) Incentive Bonus. In addition to the Bonus, the Employee may also be
eligible to receive a special incentive bonus ("Incentive Bonus"). An Incentive
Bonus shall be paid to Employee on the terms and subject to the requirements of
Exhibit "A" to this Agreement.
(e) Other Compensation Programs. The Employee shall be entitled to
participate in AVS's incentive and deferred compensation programs and such other
programs as are established and maintained generally for the benefit of AVS's
employees or executive officers, subject to the provisions of such plans or
programs.
(f) Vacations. The Employee shall be entitled to three weeks of
vacation on an annual basis. Employee shall be entitled to be reimbursed for any
accrued and unused vacation time as of the date he is no longer an employee of
AVS.
(g) Club Membership. AVS shall provide Employee with a corporate
membership to a country club mutually acceptable to Employee and AVS, including
initiation fees of up to $15,000 and monthly dues of up to $500.
(h) Other Benefits. During the term of this Agreement, the Employee
shall also be entitled to participate in any other health insurance programs,
life insurance programs, disability programs, stock option plans, bonus plans,
pension plans and other fringe benefit plans and
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programs as are from time to time established and maintained for the benefit of
AVS's employees or executive officers, subject to the provisions of such plans
and programs.
(i) Expenses. The Employee shall be reimbursed for all out-of-pocket
expenses reasonably incurred by him on behalf of or in connection with the
business of AVS, pursuant to the normal standards and guidelines followed from
time to time by AVS.
(j) Relocation Expenses Upon submission of appropriate documentation,
AVS shall reimburse Employee for the full and total cost of (i) transporting all
household goods currently residing at [omitted intentionally], by a company
widely recognized as an expert in relocation matters, to the permanent residence
the Employee shall establish in Greensboro, North Carolina, (ii) flying the
Employee and his immediate family to and from [omitted intentionally] to
Greensboro, North Carolina and (iii) direct costs of temporary housing in
Greensboro for a period of up to 180 days from the date Employee begins his
residence in Greensboro.
(k) Real Estate Fees. Upon submission of appropriate documentation, AVS
shall reimburse the Employee for full and total costs of any and all reasonable
real estate fees or costs normally involved in the sale and purchase of
residential real estate. These costs may include or all of the following; loan
origination fees, appraisal fees, credit reports, mortgage broker fees, real
estate broker fees, title insurance and recording fees resulting from the sale
of Employee's current residence at [omitted intentionally].
(l) Withholding. All payments made to the Employee hereunder shall be
made net of any applicable withholding for income taxes and the Employee's share
of FICA, FUTA or other taxes. The Company shall withhold such amounts from such
payments to the extent required by applicable law and remit such amounts to the
applicable governmental authorities in accordance with applicable law.
3. Termination.
(a) Cause. At any time during the Employment Period, AVS shall have the
right to terminate the Employment Period and to discharge the Employee for
"cause" effective upon delivery of written notice to the Employee. Upon any such
termination by AVS for cause, the Employee or his legal representatives shall be
entitled to that portion of the Salary prorated through the date of termination,
and AVS shall have no further obligations hereunder from and after the date of
such termination. Termination for "cause" shall mean termination because of (i)
the Employee's breach of his covenants contained in this Agreement, (ii) the
Employee's failure or refusal to perform the duties and responsibilities
required to be performed by the Employee under the terms of this Agreement,
(iii) the Employee's gross negligence or willful misconduct in the performance
of his duties hereunder, (iv) the Employee's commission of an act of dishonesty
affecting AVS, or the commission of an act constituting common law fraud or a
felony, or (v) the Employee's commission of an act (other than the good faith
exercise of his business judgment in the exercise of his responsibilities)
resulting in material damages to AVS. If the Employee shall resign or otherwise
terminate his employment with AVS, the Employee shall be deemed for purposes of
this Agreement to have been terminated for "cause," and AVS shall not have any
further obligations hereunder from and after the date of such termination.
Notwithstanding the foregoing, AVS shall not inform any third party that
Employee was terminated for "cause" if
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Employee's termination was as a result of Employee resigning or otherwise
terminating his employment.
(b) Without Cause. At any time during the Employment Period, AVS shall
have the right to terminate the Employment Period and to discharge the Employee
without cause effective upon delivery of written notice to the Employee. Upon
any such termination by AVS without cause, provided that Employee is otherwise
in compliance with the provisions of Sections 4 and 5 hereof, the Employee shall
be entitled to receive each month for every month remaining in the Employment
Period an amount equal to the monthly portion of his Salary, when and as the
same would have been due and payable hereunder but for such termination, and
otherwise AVS shall have no further obligations hereunder from and after the
date of such termination.
(c) Death or Disability. At any time during the Employment Period if
Employee is unable to perform his duties and responsibilities as provided
herein, due to his death or due to a physical or mental disability for more than
one hundred eighty (180) days, AVS upon written notice may terminate the
Employment Period provided that Employee shall receive disability payments
during the term of Employees disability which Employee is entitled to receive
under the applicable Companies (as defined hereafter) Disability Plan.
4. Restrictive Covenants. In consideration of the foregoing, the Employee
agrees that he shall not:
(a) during the Employment Period and for a period of six months
following the termination of the Employment Period for any reason, directly or
indirectly, alone or as a partner, joint venture, officer, director, member,
employee, consultant, agent, independent contractor or shareholder of, or lender
to, any company or business, engage in any business in the aerospace industry
directly or indirectly in competition with the business of AVS or its affiliates
(AVS or its affiliates collectively (the "Companies")) as such business now
exists or as it may exist at the time of termination; provided, however, that,
the beneficial ownership of less than five percent (5%) of the shares of stock
of any other corporation having a class of equity securities actively traded on
a national securities exchange or over-the-counter market shall not be deemed,
in and of itself, to violate the prohibitions of this Section; and, provided
further, that Employee shall be entitled to receive each month for six months
following the termination of the Employment Period Employee's monthly portion of
the Salary, unless Employee was terminated for "cause," in which case this
restrictive covenant shall apply notwithstanding the payment of severance;
(b) for a period of six months following the termination of the
Employment Period, directly or indirectly (i) induce any Person which is a
customer of any of the Companies, to patronize any business in the aerospace
industry directly or indirectly in competition with business conducted by any of
the Companies; (ii) canvass, solicit or accept from any Person which is a
customer of any of the Companies, any such competitive business; or (iii)
request or advise any Person which is a customer or supplier of any of the
Companies, to withdraw, curtail or cancel any such customer's or supplier's
business with any of the Companies, or its or their successors;
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(c) for a period of one year following the Employment Period, directly
or indirectly employ, or knowingly permit any company or business directly or
indirectly controlled by him, to employ, any person who was employed by any of
the Companies, at or within the prior three months, or in any manner seek to
induce any such person to leave his or her employment;
(d) at any time following the date hereof, directly or indirectly, in
any way outside of his employment with any of the Companies utilize, disclose,
copy, reproduce or retain in his possession any of the Companies' proprietary
rights or records, including, but not limited to, any of its customer lists.
5. Confidentiality. The Employee agrees that at all times during and after
the Employment Period, the Employee shall (i) hold in confidence and refrain
from disclosing to any other party all information, whether written or oral,
tangible or intangible, of a private, secret, proprietary or confidential
nature, of or concerning the Companies and their business and operations, and
all files, letters, memoranda, reports, records, computer disks or other
computer storage medium, data, models or any photographic or other tangible
materials containing such information ("Confidential Information"), including
without limitation, any technical specifications, any sales, promotional or
marketing plans, programs, techniques, practices or strategies, any expansion
plans (including existing entry into new geographic and/or product markets), and
any customer lists, (ii) use the Confidential Information solely in connection
with his employment with the Companies and for no other purpose, (iii) take all
reasonable precautions necessary to ensure that the Confidential Information
shall not be, or be permitted to be, shown, copied or disclosed to third
parties, without the prior written consent of AVS, and (iv) observe all security
policies implemented by the Companies from time to time with respect to the
Confidential Information. In the event that the Employee is ordered to disclose
any Confidential Information, whether in a legal or regulatory proceeding or
otherwise, the Employee shall provide AVS with prompt notice of such request or
order so that the Companies may seek to prevent disclosure. In the case of any
disclosure, the Employee shall disclose only that portion of the Confidential
Information that he is ordered to disclose.
6. Acknowledgments of the Parties. The parties agree and acknowledge that
the restrictions contained in Sections 4 and 5 are reasonable in scope and
duration and are necessary to protect the Companies. If any provision of Section
4 or 5 as applied to any party or to any circumstance is adjudged by a court to
be invalid or unenforceable, the same shall in no way affect any other
circumstance or the validity or enforceability of any other provision of this
Agreement. If any such provision, or any part thereof, is held to be
unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination shall have
the power to reduce the duration and/or area of such provision, and/or to delete
specific words or phrases, and in its reduced form, such provision shall then be
enforceable and shall be enforced. The Employee agrees and acknowledges that the
breach of Section 4 or 5 will cause irreparable injury to the Companies and upon
breach of any provision of such Sections, the Companies shall be entitled to
injunctive relief, specific performance or other equitable relief; provided,
however, that, this shall in no way limit any other remedies which the Companies
may have.
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7. Notices. All notices, requests, demands, claims and other
communications hereunder shall be in writing and shall be deemed given on the
date delivered if delivered by certified or registered mail (first class postage
pre-paid) or guaranteed overnight delivery and on the date sent if sent by
facsimile transmission if such transmission is confirmed by delivery by
certified or registered mail (first class postage pre-paid) or guaranteed
overnight delivery, in each case to the following addresses and facsimile
numbers (or to such other addresses or telecopy numbers which such party shall
designate in writing to the other party): (a) if to AVS at 000 Xxxxx Xxxx,
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Xxx Xxxx, Chief Operating Officer
(facsimile: 1-336-664-0339), with a copy to Xxxxxx X. Xxxxxxxx, Esq., Xxx
Xxxxxxxxx Xxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000 (facsimile: 1-305-374-5095); and
(b) if to the Employee at the address and facsimile number listed on the
signature page hereto.
8. Amendment; Waiver. This Agreement may not be modified, amended,
supplemented, canceled or discharged, except by written instrument executed by
all parties. No failure to exercise, and no delay in exercising, any right,
power or privilege under this Agreement shall operate as a waiver, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
the exercise of any other right, power or privilege. No waiver of any breach of
any provision shall be deemed to be a waiver of any preceding or succeeding
breach of the same or any other provision, nor shall any waiver be implied from
any course of dealing between the parties. No extension of time for performance
of any obligations or other acts hereunder or under any other Agreement shall be
deemed to be an extension of the time for performance of any other obligations
or any other acts. The rights and remedies of the parties under this Agreement
are in addition to all other rights and remedies, at law or equity, that they
may have against each other.
9. Assignment; Third Party Beneficiary; Guaranty. This Agreement, and
the Employee's rights and obligations hereunder, may not be assigned or
delegated by him. The rights and obligations of AVS under this Agreement shall
inure to the benefit of and be binding upon its respective successors and
assigns.
10. Severability; Survival. In the event that any provision of this
Agreement is found to be void and unenforceable by a court of competent
jurisdiction, then such unenforceable provision shall be deemed modified so as
to be enforceable (or if not subject to modification then eliminated herefrom)
for the purpose of those procedures to the extent necessary to permit the
remaining provisions to be enforced. The provisions of Sections 4, 5, 9 and 10
will survive the termination of this Agreement and the Employment Period for any
reason.
11. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one and the same instrument.
12. Governing Law. This Agreement shall be construed in accordance with
and governed for all purposes by the laws of the State of North Carolina
applicable to contracts executed and to be wholly performed within such State.
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13. Entire Agreement. This Agreement contains the entire understanding
of the parties in respect of its subject matter and supersedes all prior
agreements and understandings (oral or written) between or among the parties
with respect to such subject matter.
14. Headings. The headings of Paragraphs and Sections are for
convenience of reference and are not part of this Agreement and shall not affect
the interpretation of any of its terms.
15. Construction. This Agreement shall be construed as a whole
according to its fair meaning and not strictly for or against any party. The
parties acknowledge that each of them has reviewed this Agreement and has had
the opportunity to have it reviewed by their respective attorneys and that any
rule of construction to the effect that ambiguities are to be resolved against
the drafting party shall not apply in the interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
AVIATION SALES COMPANY
By: /s/ Xxx X. Xxxxxx, Xx.
-------------------------
Name: Xxx X. Xxxxxx, Xx.
Title: Chairman and CEO
EMPLOYEE:
/s/ Xxxx Xxxxxxx
-----------------------------
Name: Xxxx Xxxxxxx
Address for Notices:
[omitted intentionally]
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