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EXHIBIT 10.2
March 22, 2000
Xx. Xxxxxxx X. Xxxx
0000 Xxxxxx Xxxx Xxxxx #000
Xxxxxxxxxx, XX 00000
Re: Amendment to Employment Agreement
Dear Xxxxxxx:
This letter constitutes an amendment to the Employment
Agreement dated as of January 1, 1999 between Mesa Air Group, Inc. (the
"Company") and you (the "Employment Agreement").
Section 7.4(i) of the Employment Agreement is hereby amended
by deleting the first sentence thereof and replacing it with the following:
"The Executive shall be entitled to terminate his
employment hereunder for Good Reason immediately upon, or at any time
within one-year after, the occurrence of an event constituting Good
Reason."
Section 7.4(i) of the Employment Agreement is also hereby
amended by deleting clause (4) thereof and replacing it with the following:
"(4) a Change in Control (as hereinafter defined),
provided in no event shall the Executive be deemed to have given his
consent to any Change of Control;".
Section 7.4(ii)(6) of the Employment Agreement is hereby
deleted and replaced with the following:
"(6) The shareholders of the Company approve a merger or
consolidation involving the Company (A) in which the Company is not the
surviving corporation or (B) if, immediately following such merger or
consolidation, less than seventy-five percent (75%) of the surviving
corporation's outstanding voting stock is held or is anticipated to be
held by persons who are stockholders of the Company immediately prior to
such merger or consolidation."
Section 7.5 of the Employment Agreement is hereby amended and
supplemented by adding the following to end thereof:
"In addition, and notwithstanding the terms of any stock
option, stock incentive or similar plan maintained by the Company or any
other agreement between the Company and Executive (including, without
limitation, any stock option agreement), upon termination of the
Executive's employment Without Good Cause or upon the exercise by the
Executive of his rights to terminate his employment for Good Reason
(including without limitation upon or following a Change in Control), the
Company shall make a lump sum cash payment to Executive as follows:
(i) If the Executive's employment is terminated by the
Company Without Good Cause or by Executive for Good Reason, in each case,
upon or following a Change in Control transaction in which the holders of
Company's common stock receive consideration for their shares
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(either in the form of cash or securities, property or a combination
thereof), the cash payment to Executive shall be made on the closing
date of the transaction constituting the Change in Control and shall
equal the greater of (A) the aggregate Black Scholes value as of such
closing date of all options held by the Executive to acquire shares of
the common stock of the Company ("Company Options") and (B) the product
of (i) the per share consideration (the value of which shall be
determined by agreement between the Company and Executive) to be paid
to a holder of a share of the Company's common stock minus the exercise
price per share of each Company Option held by Executive and (ii) the
number of shares of common stock of the Company covered by each
unexercised Company Option held by Executive; provided, however, that
the total aggregate cash payment to be made to Executive pursuant to
this Section 7.5 shall not in any event be less than $1,300,000.
(ii) If the Executive's employment is terminated by the
Company Without Good Cause or by Executive for Good Reason, in each case,
in circumstances other than those applicable to clause (i) above, the cash
payment to Executive shall be made on the date of termination or the date
of the event giving rise to Executive's right to terminate his employment
(whichever is earlier) and shall equal the aggregate Black Scholes value
as of such earlier date of all Company Options held by the Executive."
The following new Section 7.7 is added to the Employment
Agreement following Section 7.6:
"7.7 Consulting Agreement. If the Executive's employment
is terminated by the Company Without Good Cause or by Executive for Good
Reason, on the effective date of the termination, the Company and
Executive shall enter into a consulting agreement in the form of Exhibit A
hereto.
Section 11.1 of the Employment Agreement is hereby amended and
supplemented by adding, immediately following clause (4) thereof, the following
new clause (5):
", or (5) any benefit or payment under Section 7.5."
This letter does not constitute a consent or waiver to or
modification of any other provision, term or condition of the Employment
Agreement, all of which remain in full force and effect.
If the foregoing meets with your approval, please indicate
your acceptance of the terms set forth in this letter by signing in the space
provided below and on the enclosed copy and by returning the copy to us for our
records.
Very truly yours,
MESA AIR GROUP, INC.
By:
------
/s/ Xxxxx X. Xxxxxxx
--------------------
Title: Vice President, General Counsel & Secretary
Accepted and agreed:
/s/ Xxxxxxx X. Xxxx
--------------------
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EXHIBIT A
CONSULTING AGREEMENT
CONSULTING AGREEMENT (this "Agreement") made and entered ____
___, _____ (the "Effective Date"), between Mesa Air Group, Inc., a Nevada
Corporation (the "Company"), with its principal place of business at 000 Xxxxx
00xx Xxxxxx, Xxxxxxx, Xxxxxxx 00000, and Xxxxxxx X. Xxxx ("Consultant"),
residing at ________________.
WHEREAS, Consultant's employment with the Company terminated
as of ______ __, _____.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and conditions hereinafter set forth, the parties agree as
follows:
RETENTION AS CONSULTANT.
The Company hereby retains Consultant as a consultant to the
Company.
Section 1.23 Services. Consultant shall render general management
consulting services ("Services") to the Company as may reasonably be requested
of him from time to time by the Company's Board of Directors. Consultant shall
have no minimum hourly service requirement nor will Consultant be required to
devote substantially all his time and attention to matters concerning the
Company. Except as may be specifically agreed to by the Company, Consultant
shall pay his own expenses relating to his performance of this Agreement.
Section 1.24 Performance. Upon reasonable notice, Consultant shall
perform such Services in Phoenix, Arizona or such other location as the parties
may mutually agree.
Section 1.25 Term. The term of this Agreement shall expire as of
the close of business on the tenth anniversary of the date hereof, unless sooner
terminated as hereinafter set forth.
Section 1.26 Payment. Consultant shall be entitled to be
compensated at the rate of $[25,000] per annum, payable in semi-annual
installments. The compensation set forth above shall be the sole compensation
payable to Consultant for his performance hereunder.
Section 1.27 Other Benefits. During the term of this Agreement,
the Company shall provide Consultant with life and health insurance benefits and
perquisites substantially similar to those which Consultant was receiving
immediately prior to the date hereof. Life and health insurance coverage
provided by the Company will terminate automatically upon Consultant's
employment with any other entity which provides life and health insurance
coverage. The Company and its affiliated airlines will grant Consultant and his
spouse lifetime passes for positive space travel. Consultant will not be
entitled to receive any vacation or illness payments, or to participate in any
plans, arrangements, or distributions by the Company pertaining to any bonus,
profit sharing, or similar benefits for the Company's employees.
RELATIONSHIP OF PARTIES
Section 1.28 Independent Contractor. Consultant is an independent contractor and
is not an agent or employee of, and has no authority to bind, the Company by
contract or otherwise.
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Consultant will perform the Services under the general direction of the Board of
Directors of the Company, but Consultant will determine, in Consultant's sole
discretion, the manner and means by which the Services are accomplished, subject
to the requirement that Consultant shall at all times comply with applicable
law. The Company has no right or authority to control the manner or means by
which the Services are accomplished. Any employee, independent contractor or
agent used by Consultant in the course of performing the Services hereunder is
the sole responsibility of Consultant.
Section 1.29 Employment Taxes. Consultant will report as
self-employment income all compensation received by Consultant pursuant to this
Agreement. Consultant will indemnify the Company and hold it harmless from and
against all claims, damages, losses and expenses, including reasonable fees and
expenses of attorneys and other professionals, relating to any obligation
imposed by law on the Company to pay any withholding taxes, social security,
unemployment or disability insurance, or similar items in connection with
compensation received by Consultant pursuant to this Agreement.
CONFIDENTIAL INFORMATION
Consultant acknowledges that Consultant may have heretofore
acquired or may hereafter acquire information and materials from the Company and
knowledge about the business, products, customers, consultants, advisors and
suppliers of the Company and that all such knowledge, information and materials
acquired, the existence, terms and conditions of this Agreement, and the content
are and will be the trade secrets and confidential and proprietary information
of the Company (collectively, "Confidential Information"). Confidential
Information will not include, however, any information that is or becomes part
of the public domain through no fault of Consultant or that the Company
specifically designates as non-confidential. Consultant agrees to hold all such
Confidential Information in strict confidence, not to disclose it to others or
use it in any way, commercially or otherwise, except in performing the Services,
and not to allow any unauthorized person access to it, either before or after
expiration or termination of this Agreement. Consultant further agrees to take
all action reasonably necessary and satisfactory to protect the confidentiality
of the Confidential Information, including, without limitation, physically
securing any Confidential information that comes into Consultant's possession
from time to time.
INDEMNIFICATION BY CONSULTANT
Consultant will indemnify the Company and hold it harmless
from and against all claims, damages, losses and expenses, including court costs
and reasonable fees and expenses of attorneys, expert witnesses, and other
professionals, arising out of or resulting from, and, at the Company's option,
Consultant will defend the Company against any action by a third party that is
based on any negligent act or omission or intentional misconduct of Consultant
which results in: (a) any bodily injury or death; (b) any injury or destruction
to tangible or intangible property or any loss of use resulting therefrom; or
(c) any violation of any statute, ordinance or regulation.
TERMINATION AND EXPIRATION
Section 1.30 Breach. Either party may terminate this Agreement in
the event of a material breach by the other party of this Agreement if such
breach continues uncured for a period of ten (10) days after written notice.
Section 1.31 At Will. The Company may terminate this Agreement at
any time, for any reason or no reason, by written notice to Consultant. In the
event the Company terminates this Agreement for any reason other than for breach
of Section 3 or Subsection 5.1 herein, Consultant shall be entitled to receive
payment hereunder until the earlier of the expiration of the term of this
Agreement or Consultants death.
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Section 1.32 Expiration. Unless terminated earlier, this Agreement
will expire at the end of the period of consultancy.
Section 1.33 No Election of Remedies. The election by the Company
to terminate this Agreement in accordance with its terms shall not be deemed an
election of remedies, and all other remedies provided by this Agreement or
available at law or in equity shall survive any termination.
EFFECT OF EXPIRATION OR TERMINATION
Section 1.34 Survival of Obligations. Upon the expiration or
termination of this Agreement for any reason, each party will be released from
all obligations to the other arising after the date of expiration or
termination, except that expiration or termination of this Agreement will not
relieve Consultant of its obligations under Section 3 above nor will expiration
or termination relieve Consultant or the Company from any liability arising from
any breach of this Agreement.
Section 1.35 Return of Confidential Information. Upon the
expiration or termination of this Agreement for any reason, Consultant will
promptly notify the Company of all Confidential Information, including, but not
limited to, the content in Consultant's possession and, in accordance with the
Company's instructions, will promptly deliver to the Company all such
Confidential Information.
COVENANTS
Section 1.36 Solicitation of Employment. Consultant agrees that it
will not solicit the services of any of the employees, consultants, advisors,
suppliers or customers of the Company for the Period of Consultancy and for six
(6) months thereafter without the prior written consent of the Company.
Section 1.37 Time of Performance. Consultant represents and
warrants that Consultant has performed all Services during Consultant's free
time and in no event has Consultant performed the Services during the course of
Consultant's work as an employee, consultant, independent contractor or
otherwise with any independent third party.
GENERAL
Section 1.38 Assignment. Consultant may not assign Consultant's
rights or delegate Consultant's duties under this Agreement, either in whole or
in part, without the prior written consent of the Company. Any attempted
assignment or delegation without such consent will be void.
Section 1.39 Equitable Remedies. Because the Services are personal
and unique and because Consultant will have access to Confidential Information
of the Company, the Company will have the right to enforce this Agreement and
any of its provisions by injunction, specific performance, or other equitable
relief without the need to post a bond or other security, without prejudice to
any other rights and remedies that the Company may have for a breach of this
Agreement.
Section 1.40 Attorneys' Fees. If any action is necessary to
enforce the terms of this Agreement, the substantially prevailing party will be
entitled to reasonable attorneys' fees, costs and expenses in addition to any
other relief to which such prevailing party may be entitled.
Section 1.41 Governing Law; Severability. This Agreement will be
governed by and construed in accordance with the laws of the State of Arizona,
excluding that body of law pertaining to conflict of laws. If any provision of
this Agreement is for any reason found to be inoperative, invalid or
unenforceable, the remainder of this Agreement will continue in full force and
effect without regard to such
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inoperative, invalid or unenforceable provision and, to this end all
provisions of this Agreement are declared to be severable.
Section 1.42 Notices. Any notices under this Agreement will be
sent by certified or registered mail, return receipt requested, by personal
delivery to the address specified above or such other address as the party
specifies in writing. Such notice will be effective upon its delivery or
transmittal as specified.
Section 1.43 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same document.
Section 1.44 Complete Understanding; Modification. This Agreement,
together with the Amendment to Agreement and the Exhibits thereto, constitutes
the complete and exclusive understanding and agreement of the parties and
supersedes all prior understandings and agreements, whether written or oral,
with respect to the subject matter hereof. Any waiver, modification or amendment
of any provision of this Agreement will be effective only if in writing and
signed by the parties hereto.
IN WITNESS WHEREOF, the parties have signed this Agreement as
of the Effective Date.
MESA AIR GROUP, INC.
By: __________________________________________________
Name:_____________________________________________
Title:____________________________________________
CONSULTANT
By: ___________________________________________________
Name: Xxxxxxx X. Xxxx
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