AGREEMENT
Exhibit 10.1
AGREEMENT
This Agreement (this “Agreement”), effective as of January 31, 2006 is made by and between
Xxxxxx Aircraft Industries, Inc., a Delaware corporation (the “Company”), and Xxx Xxxxxx (“Xx.
Xxxxxx”).
WHEREAS, Xx. Xxxxxx has served in the position of Chairman of the Board of Directors (the
“Board”) and President and Chief Executive Officer of the Company;
WHEREAS, Xx. Xxxxxx has indicated his desire to retire from the Company and from his position
on the Board; and
WHEREAS, the Company and Xx. Xxxxxx mutually desire to clarify and forever resolve any and all
obligations that may exist regarding compensation payable to Xx. Xxxxxx as a result of his
employment with the Company and his service as a member of the Board.
NOW, THEREFORE, in consideration of the covenants and undertakings contained herein, and for
other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Company
and Xx. Xxxxxx hereby agree as follows:
1. Retirement of Xx. Xxxxxx. Xx. Xxxxxx shall resign from his position as Chairman of
the Board and President and Chief Executive Officer of the Company effective as of January 31,
2006, and shall retire from his employment with the Company effective as of February 28, 2006 (the
“Effective Date”).
2. Non-Qualified Pension Plan. The Company agrees to honor, and not to rescind, the
terms of any election properly made by Xx. Xxxxxx under the Company’s Non-Qualified Pension Plan
with respect the form of benefit payable to Xx. Xxxxxx under the terms of that plan.
3. Outstanding Stock Options. Xx. Xxxxxx’x outstanding stock options (the “Options”)
shall continue to be governed by the terms of the Incentive Stock Option Agreements through which
such stock options were granted to Xx. Xxxxxx (the “Option Agreements”), except that such Option
Agreements shall be amended to extend the expiration date of any vested Options until December 31,
2006.
4. COBRA. Following his termination, Xx. Xxxxxx may elect continuation of group
health benefits for himself and his eligible dependents as provided under COBRA and the rules of
the plan. Xx. Xxxxxx will be responsible for paying the entire cost of any applicable monthly
premiums and administrative costs of continuation coverage for himself and/or his dependents as
provided by the applicable plan rules. Within ten (10) days after the Effective Date, Xx. Xxxxxx
will receive a one-time, lump-sum amount equal to the Company’s portion of continuation coverage
costs for a 12-month period, as determined on the Effective Date.
5. Stock Repurchase Program. The Company agrees that Xx. Xxxxxx shall be entitled to
participate in a manner and on terms comparable to other Company Executives with respect to any
offer to repurchase Company stock that shall be made available to other Company Executives as a
group prior to December 31, 2006.
6. General Release of Claims by Xx. Xxxxxx. Xx. Xxxxxx agrees that he will execute a
general release of all claims on the Effective Date in substantially the form attached hereto as
Exhibit A. Xx. Xxxxxx hereby agrees and acknowledges that his right to the benefits provided under
this Agreement, and the Company’s obligations under Sections 2, 3, 4 and 5 of this Agreement, are
subject to Xx. Xxxxxx’x timely execution and non-revocation of such release.
7. Consulting Agreement. The parties agree that they will enter into a Consulting
Agreement substantially in the form attached hereto as Exhibit B (the “Consulting Agreement”).
8. Governing Law. This Agreement shall be governed, construed, interpreted and
enforced in accordance with its express terms, and otherwise in accordance with the substantive
laws of the State of Texas, without reference to the principles of its conflicts of law, and where
applicable, the laws of the United States.
9. Validity. The invalidity or unenforceability of any provision or 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.
10. Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original, but all of which together will constitute one and the same
Agreement. Signatures delivered by facsimile shall be deemed effective for all purposes.
11. Entire Agreement. The parties further intend that this Agreement shall constitute
the complete and exclusive statement of their terms and that no extrinsic evidence whatsoever may
be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this
Agreement.
12. No Other Payments. Xx. Xxxxxx understands and agrees that the Company shall make
no other payments to Xx. Xxxxxx, and shall have no other obligations to Xx. Xxxxxx other than those
described in this Agreement, except for any accrued obligations or other benefits otherwise payable
to Xx. Xxxxxx pursuant to the terms of the Company’s normal payroll practices or employee benefit
plans, or pursuant to the terms of the Consulting Agreement.
13. Withholding. The Company shall be entitled to withhold from any amounts payable
under this Agreement any federal, state, local or foreign withholding or other taxes or charges
which the Company is required to withhold. The Company shall be entitled to rely on an opinion of
counsel if any questions as to the amount or requirement of withholding shall arise.
IN WITNESS WHEREOF, the Company and Xx. Xxxxxx have caused this Agreement to be executed
effective as of the date first above written.
| XXXXXX AIRCRAFT INDUSTRIES, INC. | ||||||
| By: | /s/ W. Xxxxx Xxxxx, Jr. | |||||
| Name: W. Xxxxx Xxxxx, Jr. | ||||||
| Title: | Vice President, General Counsel and | |||||
| Corporate Secretary | ||||||
| /s/ Xxx Xxxxxx | ||||||
| Xxx Xxxxxx | ||||||
Exhibit A
Release Agreement
This Release Agreement (“Agreement”) is made by and between Xxxxxx Aircraft Industries, Inc.,
a Delaware corporation (the “Company”) and Xxx Xxxxxx (“Xx. Xxxxxx”) (collectively referred to as
the “Parties”) on February 28, 2006. The Parties agree that, pursuant to that certain Agreement,
dated as of January 31, 2006, between the Company and Xx. Xxxxxx (the “Separation Agreement”), Xx.
Xxxxxx’x employment with the Company will terminate on the date hereof. In connection with Xx.
Xxxxxx’x termination of employment, the Separation Agreement provides that if Xx. Xxxxxx chooses to
sign and not revoke this Agreement, Xx. Xxxxxx will be entitled to the benefits provided in the
Separation Agreement, including the extension of the expiration date of his outstanding stock
options. Xx. Xxxxxx understands that he is not entitled to such benefits unless he signs and does
not revoke this Agreement.
In consideration for the benefits provided in the Separation Agreement, Xx. Xxxxxx hereby
agrees, for Xx. Xxxxxx, Xx. Xxxxxx’x spouse and child or children (if any), Xx. Xxxxxx’x heirs,
beneficiaries, devisees, executors, administrators, attorneys, personal representatives, successors
and assigns, to forever release, discharge and covenant not to xxx the Company or any of its
divisions, affiliates, subsidiaries, parents, branches, predecessors, successors, assigns, and,
with respect to such entities, their officers, directors, trustees, employees, agents,
shareholders, administrators, general or limited partners, representatives, attorneys, insurers and
fiduciaries, past, present and future (the “Released Parties”) from any and all claims of any kind
arising out of, or related to, Xx. Xxxxxx’x employment with the Company, its affiliates and
subsidiaries (collectively, with the Company, the “Affiliated Entities”), Xx. Xxxxxx’x service on
the Board of Directors of the Company (the “Board”), Xx. Xxxxxx’x separation from employment with
the Affiliated Entities and his termination of service on the Board, which Xx. Xxxxxx now has or
may have against the Released Parties, whether known or unknown to Xx. Xxxxxx, by reason of facts
which have occurred on or prior to the date that Xx. Xxxxxx has signed this Agreement. Such
released claims include, without limitation, any and all claims relating to the foregoing under
federal, state or local laws pertaining to employment, including, without limitation, the Age
Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C.
Section 2000e et. seq., the Fair Labor Standards Act, as amended, 29 U.S.C. Section 201 et. seq.,
the Americans with Disabilities Act, as amended, 42 U.S.C. Section 12101 et. seq. the
Reconstruction Era Civil Rights Act, as amended, 42 U.S.C. Section 1981 et. seq., the
Rehabilitation Act of 1973, as amended, 29 U.S.C. Section 701 et. seq., the Family and Medical
Leave Act of 1992, 29 U.S.C. Section 2601 et. seq., and any and all state or local laws regarding
employment discrimination and/or federal, state or local laws of any type or description regarding
employment, including but not limited to any claims arising from or derivative of Xx. Xxxxxx’x
employment with the Affiliated Entities, as well as any and all such claims under state contract or
tort law. Xx. Xxxxxx further agrees not to disparage in any material respect the Company, any of
its products or practices, or any of its Affiliated Entities, either orally or in writing. This
release shall not affect any vested rights or claims Xx. Xxxxxx may have for employee benefits
pursuant to the terms of any employee benefit plan (within the meaning of the Employee Retirement
Income Security Act of 1974, as amended) maintained by the Company, or any rights or claims Xx.
Xxxxxx may have for breach of the Separation Agreement.
Xx. Xxxxxx has read this Agreement carefully, acknowledges that Xx. Xxxxxx has been given at
least 21 days to consider all of its terms and has been advised to consult with any attorney and
any other advisors of Xx. Xxxxxx’x choice prior to executing this Agreement, and Xx. Xxxxxx fully
understands that by signing below Xx. Xxxxxx is voluntarily giving up any right which Xx. Xxxxxx
may have to xxx or bring any other claims against the Released Parties, including any rights and
claims under the Age Discrimination in Employment Act. Xx. Xxxxxx also understands that Xx. Xxxxxx
has a period of seven days after signing this Agreement within which to revoke his agreement, and
that neither the Company nor any other person is obligated to make any payments or provide any
other benefits to Xx. Xxxxxx pursuant to the Agreement until eight days have passed since Xx.
Xxxxxx’x signing of this Agreement without Xx. Xxxxxx’x signature having been revoked other than
any accrued obligations or other benefits payable pursuant to the terms of the Company’s normal
payroll practices or employee benefit plans. Finally, Xx. Xxxxxx has not been forced or pressured
in any manner whatsoever to sign this Agreement, and Xx. Xxxxxx agrees to all of its terms
voluntarily.
This Agreement is final and binding and may not be changed or modified except in a writing
signed by both parties.
Date
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Xxxxxx Aircraft Industries, Inc. |
