SIXTH AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.1
SIXTH
AMENDED AND RESTATED
SIXTH
AMENDED AND RESTATED EMPLOYMENT AGREEMENT dated as of December 16, 2008 (the
“Agreement”)
among Atlantic Express Transportation Group Inc., a New York corporation (“Group”), Atlantic
Express Transportation Corp., a New York corporation (the “Company”), and
Xxxxxxx Xxxxx (the “Executive”).
WHEREAS,
the Executive is presently employed by the Company, a wholly owned subsidiary of
Group, under a Fifth Amended and Restated Employment Agreement dated as of April
18, 2007, as amended (the “Prior
Agreement”);
WHEREAS,
in order to comply with Section 409A of the Internal Revenue Code of 1986, as
amended, and the Department of Treasury Regulations and other interpretive
guidance promulgated thereunder (collectively, “Section 409A”), the
Company, Group and the Executive desire to amend and restate the terms and
provisions of the Prior Agreement to, among other things, set forth the terms of
the Executive’s continued employment.
NOW,
THEREFORE, in consideration of the foregoing and the respective covenants and
agreements hereinafter set forth and for other good and valuable consideration,
the Company, Group and the Executive hereby agree to amend and restate the Prior
Agreement in its entirety, as follows:
1. EMPLOYMENT AND
DUTIES
1.1.
General. The
Company hereby employs the Executive, and the Executive agrees to serve, as
President and Chief Executive Officer of the Company and upon the Board of
Directors of the Company (the “Board”) as Vice
Chairman of the Board, upon the terms and conditions herein contained during the
Employment Term. In such capacities the Executive agrees to serve the
Company faithfully and to the best of his ability under the direction of the
Board. The Executive also shall serve as a member of the Board of Directors of
Group during the Employment Term. During the Employment Term, the
Executive also agrees to serve, if elected, at no compensation in addition to
that provided for in this Agreement, in the position of officer of Group and of
any subsidiary of Group or the Company. As long as the Executive remains either
President or Chief Executive Officer, the Executive shall continue to occupy the
same corner office which he has occupied during the Term of the Prior
Agreement.
1.2.
Exclusive
Services. During the Employment Term, the Executive shall devote his
full-time working hours to his duties hereunder and shall not, directly or
indirectly, render services to any other person or organization for which he
receives compensation without the unanimous consent of the Board or otherwise
engage in activities which would interfere significantly with his faithful
performance of his duties hereunder. Notwithstanding the foregoing, the
Executive may serve as a managing member of Birdie Holding Company LLC and
affiliates which own and operate the Eagle Oaks Golf Club, provided that such
services shall not interfere with the performance of Executive’s duties
hereunder.
1.3.
Term of
Employment. The Executive’s employment under this Agreement shall
commence as of the date hereof (the “Commencement Date”)
and shall terminate on the earliest of (i) December 31, 2009, subject to renewal
in accordance with Section 1.4, (ii) the death of the Executive or (iii) the
termination of the Executive’s employment pursuant to this Agreement (the “Employment
Term”).
1.4. Renewal of Employment
Term. Unless the Company has provided the Executive with a
written notice at least seventy-five days prior to December 31, 2009 of its
intent not to extend the Employment Term (the “Termination Notice”), the
Employment Term shall be renewed and extended automatically for a further period
of one year on January 1, 2010, and such extended term shall thereafter be
further extended for successive one year periods unless a Termination Notice is
given to the Executive at least seventy-five days prior to the next successive
December 31.
2. SALARY
2.1.
Base Salary.
From the Commencement Date, the Executive shall be entitled to receive a base
salary (“Base
Salary”) at a rate of $592,162 per annum, payable in arrears in equal
installments in accordance with the Company’s payroll practices, with such
increases as may be provided in accordance with the terms hereof. Once
increased, such higher amount shall constitute the Executive’s annual Base
Salary.
2.2. Increase in Base
Salary. On November 1 of each year during the Employment Term, the
Executive’s Base Salary shall be increased by a percentage which shall equal the
greater of 3% or the percentage increase in the consumer price index for the New
York-Northern New Jersey-Long Island, NY-NJ-CT metropolitan area, as reported by
the United States Department of Labor, for the 12-month period ended the
immediately preceding October 31.
2.3. Exit
Bonus. (a) Upon the occurrence of a Change of Control at any
time during or after the termination of the Executive’s employment, the Company
shall pay to the Executive a bonus (“Exit Bonus”) which
shall be equal to the Fair Market Value (as of the date of such Change of
Control) of 1.5% of all of the Company’s outstanding common stock (on a fully
diluted basis) immediately preceding such Change of Control (such percentage
being referred to herein as the “Base Amount”),
provided the Base Amount shall be increased to 2.5% in the event that the
transaction resulting in the Change of Control is based upon an aggregate Fair
Market Value of all of the Company’s outstanding common stock (on a fully
diluted basis) equal to or in excess of $50,000,000 and 3.0% in the event such
Fair Market Value is equal to or exceeds $70,000,000; further, provided, the Exit
Bonus to be paid to the Executive upon a Change of Control shall be reduced by
an amount equal to (i) the Fair Market Value of all of the Company’s outstanding
common stock as of the date of such Change of Control, multiplied by (ii) a
fraction, the numerator of which shall be the aggregate number of Group Common
Shares (as defined below) sold, transferred or otherwise disposed of by GSC
Group (as defined below) prior to such Change of Control and the denominator of
which shall be 107,593, multiplied by (iii) the applicable Base Amount as
determined in accordance with this Section 2.3(a) as of the date of such Change
of Control. Except as provided in Section 2.3(b), the Exit Bonus
shall be payable in the same form of consideration and at the same time as
received by the shareholders of either Group or the Company upon such Change of
Control.
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(b) In
the event the Company or Group during the Employment Term and prior to a Change
of Control, shall adopt a stock option or restricted stock purchase or similar
plan, the Executive within thirty (30) days following written notice of the
adoption of such a plan, shall have the right, by delivery of written notice to
the Company, to participate in such plan and to receive such number of shares or
options, in substitution and in place of the Exit Bonus, as would be equivalent
to the Base Amount as of the date of such participation in such plan by the
Executive, provided that any such plan shall require that the timing of payments
under such plan shall match the timing of the Exit Bonus payments that otherwise
would have occurred, or shall contain such other or additional provisions as
shall cause payments under the plan and this Section 2.3 to satisfy Section
409A.
(c) (i)
Subject to paragraph (ii), in the event prior to the occurrence of a Change of
Control, GSCP II Holdings (AE), LLC or any of its affiliates (collectively, the
“GSC Group”)
sells, transfers or otherwise disposes of any of the shares (the “Group Common Shares”)
of common stock of Group it beneficially owns as of the date hereof and
excluding any shares of common stock of Group the GSC Group may acquire after
the date hereof (a “Disposition Event”),
the Executive shall be entitled to a portion of his Exit Bonus equal to (A) the
Fair Market Value of all of the Company’s outstanding common (on a fully diluted
basis) as of the date of such Disposition Event, multiplied by (B) a fraction,
the numerator of which shall be the number of Group Common Shares sold,
transferred or otherwise disposed of in such transaction and the denominator of
which shall be 107,593, multiplied by (C) the applicable Base Amount as
determined in accordance with Section 2.3(a) as of the date of such Disposition
Event. Except as provided in Section 2.3(b) and paragraph (ii), the portion of
the Exit Bonus payable upon a Disposition Event shall be payable in the same
form of consideration and at the same time as received by the GSC Group upon
such Disposition Event.
(ii)
Subject to the Executive’s election to substitute the Exit Bonus as set forth in
Section 2.3(b), the payment described in paragraph (i) shall be made in a lump
sum in the same form of consideration as received, as applicable, by the GSC
Group or by the shareholders of either Group or the Company (A) upon the closing
of the Disposition Event if (x) such closing occurs within ten years of the date
hereof and (y) such payment would be a “short-term” deferral within the meaning
of Treas. Reg. Sec. 1.409A-1(b)(4), or otherwise (B) upon the happening of the
next following Change in Control; provided that if it is not possible to pay
such Exit Bonus in such same form, such Exit Bonus shall be paid in a cash lump
sum.
2.4 Definitions. (a)
Change of
Control shall mean (i) the transfer (in one transaction or a series of
transactions) of all or substantially all of the assets of Group or the Company
to any person or group (as such term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)); (ii)
the liquidation or dissolution of Group or the Company or the adoption of a plan
by the stockholders of Group or the Company relating to the dissolution or
liquidation of either Group or the Company; or (iii) the acquisition by any
person or group (as such term is used in Section 13(d)(3) of the Exchange Act),
except for by the GSC Group of beneficial ownership, directly or indirectly, of
more than 50% of the aggregate ordinary voting power of Group or the Company;
and
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(b) “Fair Market Value” of
the Company’s common stock shall mean the value of the Company’s common stock as
specified in accordance with any transaction resulting in a Change of Control or
Disposition Event, as the case may be, or if no specific value is specified in
such transaction, the value of the Company’s common stock as reasonably
determined by the Board (provided, in the
event the Executive disagrees with the value determined by the Board, as
determined by a nationally recognized independent investment banking or
accounting firm reasonably acceptable to the Company and the Executive), in
either case without control premiums or minority discounts.
3. EMPLOYEE
BENEFITS
3.1.
General
Benefits. The Executive shall receive the following benefits during the
Employment Term:
(a) the
Executive will be eligible to participate in benefit programs of the Company
consistent with those benefit programs provided from time to time to other
senior executives of the Company;
(b) a
disability insurance policy providing $15,000 in monthly benefits commencing six
months after a disability which prevents the Executive from performing the
ordinary and necessary functions and duties of his employment; provided that the
premium therefor shall not exceed the usual and customary rates charged by
underwriters for such a policy for a person of the Executive’s age in good
health. At the option of the Executive and in the place of the
disability policy, the Company shall pay the cash equivalent of the premium for
such policy to the Executive to be used by the Executive to pay such
premium;
(c) an
automobile allowance of $2,150 per month;
(d) an
annual life insurance premium allowance of $35,000, payable in two installments
in June and February of each year of the Employment Term hereof;
(e)
continued use of the same Company car and driver which the Executive is using as
of the date of this Agreement; and
(f) participation
in any executive incentive plan which might be implemented by the Board during
the Employment Term.
3.2.
Vacation. The
Executive shall be entitled to 25 days paid vacation each calendar year in
accordance with the applicable policies of the Company.
4. TERMINATION OF
EMPLOYMENT
4.1. Termination for Cause;
Termination Without Cause; Termination for Permanent Disability;
Resignation.
4.1.1.
General. (a)
If, prior to the expiration of the Employment Term, the Executive’s employment
is terminated by the Company for Cause, the Executive shall be entitled, subject
to Section 10.2, only to (i) his accrued but unpaid Base Salary through and
including the date of termination (“Accrued Base
Salary”); (ii) the Exit Bonus payable in accordance with Section 2.3;
(iii) twelve months of medical coverage under the same terms as medical coverage
offered to other senior executives of the Company; and (iv) as severance, an
amount equal to six months of his Base Salary payable in a lump sum on the date
of such termination of employment, provided that, if
such termination is for a Disloyalty Termination Event, the Executive shall have
no right to receive, and the Company shall have no obligation to pay the payment
described in clause (iv).
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(b) If
the Executive is terminated by the Company Without Cause, the Executive
terminates employment for Good Reason or upon the expiration of the Employment
Term without renewal in accordance with Section 1.4, the Executive shall be
entitled, subject to Section 4.5 and Section 10.2, only to (i) his Accrued Base
Salary; (ii) his Base Salary from the day after the termination date through the
normal expiration date of the Employment Term, payable in a lump sum upon
termination; (iii) the benefits set forth under Section 3.1 of this Agreement
during such term; provided, in the case
of medical coverage, during such period or for a period of one year, which ever
is longer; (iv) the Exit Bonus payable in accordance with Section 2.3; and (v)
as severance, an amount equal to his annual Base Salary (the “Severance Payment”)
payable in a lump sum on the 30th day
following the date of such termination of employment.
(c) If,
prior to the expiration of the Employment Term, the Executive’s employment is
terminated by the Company for Permanent Disability (as defined in Section 5),
the Executive shall be entitled, subject to Section 4.5 and Section 10.2, only
to (i) the payments and benefits as provided for in Section 4.1.1(a)(i), (ii)
and (iii); (ii) the benefits set forth under Section 3.1 of this Agreement for a
period of 12 months following the date of termination; and (iii) the Severance
Payment payable in a lump sum on the 30th day
following the date of such termination of employment .
(d) If
the Executive resigns from his employment hereunder without Good Reason, the
Executive shall be entitled, subject to Section 10.2, only to (i) payment of his
Accrued Base Salary, if any, payable in a lump sum not later than 30 days
following the date of termination; and (ii) the Exit Bonus payable in accordance
with Section 2.3.
(e) In
the event of termination hereunder as a result of death of the Executive, the
Executive’s estate shall be entitled, subject to Section 10.2, to (i) the
compensation provided for in Section 4.1.1(a)(i), (ii) and (iii); and (ii) the
Severance Payment payable in a lump sum on within 30 days of the date of such
termination of employment.
(f) Except
as otherwise provided herein, the Executive shall have no further right to
receive any other compensation, or to participate in any other plan,
arrangement, or benefit, after any termination or resignation of employment,
subject to the terms of such plans or arrangements.
(g) In
the event of the termination of the Executive’s employment by the Company for
any reason, the Company or Group shall, within 30 days of such termination of
employment, (x) obtain releases that release the Executive from any guarantees
made by the Executive in respect of obligations of Group, the Company or any of
their respective subsidiaries (the “Guarantees”), if any
such Guarantees are then in effect, or (y) provide letters of credit to the
Executive in respect thereof, if any such Guarantees are then in
effect.
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4.1.2.
Date of
Termination/Resignation. The date of termination for a termination by the
Company for Cause shall be the date of the written notice of termination
provided for in Section 4.1.3. The date of termination for a Termination Without
Cause shall be as provided in Section 4.1.4. The date of termination for a
termination for Permanent Disability shall be as provided in Section 5. The date
of resignation shall be the date specified in the written notice of resignation
from the Executive to the Company, or if no date is specified therein, 10
business days after receipt by the Company of written notice of resignation from
the Executive.
4.1.3.
Notice of Termination
for Cause. Termination of the Executive’s employment by the Company for
Cause shall be effected by delivery of a written notice of termination from the
Company to the Executive, which notice shall specify the event or events set
forth in Section 4.2 giving rise to such termination.
4.1.4.
Notice of Termination
Without Cause. Termination of the Executive’s employment for a
Termination Without Cause shall be effected by written notice of termination
from the Company to the Executive, specifying a termination date no earlier than
10 business days after the date on which such notice is given.
4.2.
Termination for
Cause. Termination for “Cause” shall mean
termination by the Company of the Executive’s employment because the Executive
(a) has been convicted of a crime punishable by imprisonment for more that one
year, (b) has failed to perform in all material respects the normal and
customary duties required of his position of employment, following a written
warning specifying such deficiency and affording the Executive a reasonable
period to cure such failure, or (c) has been disloyal to Group, the Company or
any of their respective affiliates by assisting transportation competitors of
Group, the Company or any of their respective affiliates to the disadvantage
of Group, the Company or any of their respective affiliates by a
breach of Section 6 or by otherwise actively assisting such competitors to the
disadvantage of Group, the Company or any of their respective affiliates (a
“Disloyalty
Termination Event”).
4.3.
Termination Without
Cause. “Termination Without
Cause” shall mean any termination by the Company of the Executive’s
employment at any time during the Employment Term for any reason other than
Cause, death or Permanent Disability.
4.4.
Termination by
Executive for “Good Reason”. In the event of: (i) a material reduction in
the nature or scope of Executive’s position as President and Chief Executive
Officer or his authorities, powers, duties, or responsibilities in such
capacity; or (ii) a material breach by the Company of its affirmative or
negative covenants or undertakings hereunder and such breach shall not be
remedied within fifteen (15) days after notice to Company thereof (which notice
shall be signed by Executive and refer to a specific breach of this Agreement);
then the Executive may at any time by notice terminate Executive’ employment
hereunder for “Good
Reason”.
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4.5. Release by
Executive. As a condition to receipt of the Severance Payment,
on or prior to the 30th day
following his termination of employment, the Executive shall execute, deliver
and not revoke a release (the “Release”) to the
Company and the Group, in a form reasonably requested by the Company, releasing
and discharging on behalf of the Executive, his heirs, administrators,
executors, agents, or employees, the Company, Group and all other affiliates,
divisions, subsidiaries and each of their predecessors, successors, assigns,
agents, directors, officers, employees, representatives, attorneys, and all
persons acting by, through, under or in concert with any of them (collectively,
the “Releasee”)
from any and all charges, claims, demands, judgments, actions, causes of action,
damages, expenses, costs, attorneys' fees, and liabilities of any kind
whatsoever, whether known or unknown, vested or contingent, in law, equity or
otherwise, which the Executive ever had, then has, or may hereafter have against
a Releasee for or on account of any matter, cause or thing whatsoever which has
occurred at any time up to the date of the Release, but excluding any
liabilities or obligations of a the Company or Group set forth in this Agreement
to the extent such liabilities or obligations survive the termination of the
Executive’s employment, and excluding any liabilities or obligations of a
Releasee arising out of any indemnity agreement in the Executive’s favor whether
contained in such Releasee’s articles of incorporation, bylaws, corporate
resolutions or in any employment agreement or arising by operation of law. For
the avoidance of doubt, any payments that are conditioned on the timely
execution, delivery and non-revocation of a Release as set forth in this Section
4.5, shall be paid to the Executive on the 30th day
following the date of the Executive’s termination of employment.
5. PERMANENT
DISABILITY
If, prior
to the expiration of the Employment Term, the Executive shall fail because of an
illness, physical or mental disability or other incapacity for a period of six
consecutive months, or for shorter periods aggregating six months during any
consecutive twelve-month period, to render the services provided for by this
Agreement, then the Company may, by written notice to the Executive after the
last day of the six consecutive months of disability or the day on which the
shorter periods of disability equal an aggregate of six months, terminate the
Executive’s employment for “Permanent
Disability”, specifying a termination date no earlier than 10 business
days after the date on which such notice is given. The determination of the
Executive’s Permanent Disability shall be made by an independent physician who
is reasonably acceptable to the Executive and the Company and shall be final and
binding and shall be based on such competent medical evidence as shall be
presented to it by the Executive or by any physician or group of physicians or
other competent medical experts employed by the Executive and/or the Company to
advise such independent physician.
6. NONCOMPETITION/NONSOLICITATION
AND CONFIDENTIALITY
6.1.
Noncompetition/Nonsolicitation.
The Executive shall not, directly or indirectly, as a sole proprietor, member of
a partnership, stockholder or investor, officer or director of a corporation, or
as an employee, associate, consultant or agent of any person, partnership,
corporation or other business organization or entity other than the Company,
Group and any of their subsidiaries: (a) engage in, or acquire an
interest in any entity or enterprise which engages in, any business that is in
competition with any business actively conducted by Group, the Company or any of
their respective subsidiaries within (i) the counties then served by Group, the
Company or their respective subsidiaries as well as adjacent counties, and (ii)
any other counties in which Group, the Company or their respective subsidiaries
has made a bid within 36 months prior to the Executive’s termination and any
adjacent counties in which Group, the Company or their respective subsidiaries
conducts business; (b) solicit or endeavor to entice away from Group, the
Company or any of their respective subsidiaries any person who is, or was during
the then most recent 36-month period, employed by or associated with Group, the
Company or any of their respective subsidiaries, or (c) solicit or endeavor to
entice away from Group, the Company or any of their respective subsidiaries, or
otherwise interfere with the business relationship of Group, the Company or any
of their respective subsidiaries with, any person or entity who is, or was
within the then most recent 36-month period, a customer, client or prospect of
Group, the Company or any of their respective subsidiaries. The obligations of
this Section 6.1 shall apply for 18 months, or a period of 24 months if, as of
termination of the employment of the Executive, more than a majority of the
Common Stock of Group is then owned by the current shareholders of Group, after
termination of employment of the Executive as well as during employment and
shall be extended by a period of time equal to any period during which the
Executive shall be in breach of such obligations.
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6.2.
Confidentiality. The
Executive covenants and agrees with the Company that he will not at any time,
except in performance of his obligations to the Company hereunder or with the
prior written consent of the Company, directly or indirectly, disclose any
secret or confidential information that he may learn or has learned by reason of
his association with Group, the Company or any of their respective subsidiaries
and affiliates. The term “confidential information” includes information not
previously disclosed to the public or to the trade by the Company’s or Group’s
management, or otherwise in the public domain, with respect to the Company’s or
Group’s or any of their respective affiliates’ or subsidiaries’ products,
services, facilities, applications and methods, trade secrets and other
intellectual property, systems, procedures, manuals, confidential reports,
product or service price lists, customer lists, technical information, financial
information (including the revenues, costs or profits associated with any of the
Company’s or Group’s products), business plans, prospects or
opportunities.
6.3.
Exclusive
Property. The Executive confirms that all confidential information is and
shall remain the exclusive property of Group and the Company. All business
records, papers and documents kept or made by the Executive relating to the
business of Group, the Company or their respective subsidiaries shall be and
remain the property of Group and the Company.
6.4.
Injunctive
Relief. Without intending to limit the remedies available to Group and
the Company, the Executive acknowledges that a breach of any of the covenants
contained in this Section 6 may result in material and irreparable injury to
Group, the Company or their respective affiliates or subsidiaries for which
there is no adequate remedy at law, that it will not be possible to measure
damages for such injuries precisely and that, in the event of such a breach or
threat thereof, Group and the Company shall be entitled to obtain a temporary
restraining order and/or a preliminary or permanent injunction restraining the
Executive from engaging in activities prohibited by this Section 6 or such other
relief as may be required specifically to enforce any of the covenants in this
Section 6. If for any reason a final decision of any court determines that the
restrictions under this Section 6 are not reasonable or that consideration
therefor is inadequate, such restrictions shall be interpreted, modified or
rewritten by such court to include as much of the duration and scope identified
in this Section 6 as will render such restrictions valid and
enforceable.
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7. GUARANTEES
7.1.
Indemnification. In
addition to any right to indemnification as provided in the By Laws or
Certificate of Incorporation of the Group and/or Company, Group, the Company and
each of their subsidiaries, jointly and severally, shall indemnify the Executive
and his spouse, heirs, estate, executors and administrators (collectively, the
“Indemnitees”)
and hold such Indemnitees harmless from and against, and pay and reimburse the
Indemnitees for, any and all demands, payments, claims, actions, losses,
damages, liabilities, obligations, fines, taxes, deficiencies, costs and
expenses (including reasonable attorneys’ fees), whether or not resulting from
third-party claims, including interest and penalties with respect thereto,
asserted against or incurred or sustained by an Indemnitee in connection with or
arising out of any personal guaranty or undertaking by the Executive of any
obligation of Group, the Company or any of their subsidiaries (collectively a
“Guaranty”).
7.2. Future Subsidiaries.
In the event, Group, the Company or any of their subsidiaries acquires or forms
a subsidiary after the date hereof, Group and the Company shall cause such newly
acquired or formed subsidiary to execute and deliver a supplement to this
Amendment, which supplement shall provide that such newly acquired or formed
subsidiary will indemnify the Indemnitees in accordance with Section 7.1
hereof.
8. [intentionally
deleted]
9. MISCELLANEOUS
9.1.
Notices. All
notices or communications hereunder shall be in writing, addressed as
follows:
To the
Company or Group, to it at:
0 Xxxxx
Xxxxxx
Xxxxxx
Xxxxxx, XX 00000
Attention:
Corporate Secretary
with a
copy to each of:
GSCP III
Holdings (AE), LLC
x/x
Xxxxxxxxx Xxxxxx Capital Partners, Inc.
000
Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx
Xxxx, XX 00000
Fax:
(000) 000-0000
Attention:
Xxxxx Xxxxx
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To the
Executive:
Xxxxxxx
Xxxxx
000
Xxxxxxxx Xxxx
Xxxxxxxx
Xxxxxxxx, XX 00000
Fax:
(000) 000-0000
with a
copy to:
Xxxxxxxxx
Xxxxx Xxxx & Xxxxx PLLC
000 Xxxx
Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx,
XX 00000
Fax:
(000) 000-0000
Attention:
Xxxxx X. Xxxxxxxxx
Any such
notice or communication shall be sent certified or registered mail, return
receipt requested, or by facsimile, addressed as above (or to such other address
as such party may designate in writing from time to time), and the actual date
of receipt shall determine the time at which notice was given.
9.2.
Severability.
If a court of competent jurisdiction determines that any term or provision
hereof is invalid or unenforceable, (a) the remaining terms and provisions
hereof shall be unimpaired and (b) such court shall have the authority to
replace such invalid or unenforceable term or provision with a term or provision
that is valid and enforceable and that comes closest to expressing the intention
of the invalid or unenforceable term or provision.
9.3.
Assignment.
This Agreement shall inure to the benefit of the heirs and representatives of
the Executive and the assigns and successors of the Company, but neither this
Agreement nor any rights hereunder shall be assignable or otherwise subject to
hypothecation by the Executive. Each of Group and the Company may assign this
Agreement without prior written approval of the Executive upon the transfer of
all or substantially all of its business and/or assets (whether by purchase,
merger, consolidation or otherwise), provided that the successor to such
business and/or assets shall expressly assume and agree to perform this
Agreement.
9.4.
Entire Agreement;
Amendment. This Agreement represents the entire agreement of the parties
with respect to the subject matter hereof and shall supersede any and all
previous contracts, arrangements or understandings between or among Group, the
Company and the Executive, including the Prior Agreement. The Agreement may be
amended at any time by mutual written agreement of the parties
hereto.
9.5.
Withholding.
The Company shall be entitled to withhold, or cause to be withheld, from payment
any amount of withholding taxes required by law with respect to payments made to
the Executive in connection with his employment hereunder.
9.6.
Governing Law.
This Agreement shall be construed, interpreted, and governed in accordance with
the laws of the State of New York without reference to principles of conflict of
laws.
9.7.
Survival.
Articles 4 (relating to early termination), 5 (relating to Permanent Disability)
and 6 (relating to noncompetition, nonsolicitation and confidentiality) and
Section 8.6 (relating to governing law) shall survive the termination hereof,
whether such termination shall be by expiration of the Employment Term or an
early termination pursuant to Sections 4 or 5 hereof.
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9.8.
Headings.
Headings to sections in this Agreement are for the convenience of the parties
only and are not intended to be a part of or to affect the meaning or
interpretation hereof.
9.9.
Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument.
10. SECTION
409A.
10.1
General. The
parties acknowledge and agree that, to the extent applicable, this Agreement
shall be interpreted in accordance with, and the parties agree to use their best
efforts to achieve timely compliance with Section 409A, including without
limitation any such regulations or other guidance that may be issued after the
date hereof. Notwithstanding any provision of this Agreement to the
contrary, in the event that the Company determines that any compensation or
benefits payable or provided under this Agreement may be subject to Section
409A, the Company may adopt (without any obligation to do so or to indemnify the
Executive for failure to do so) such limited amendments to this Agreement and
appropriate policies and procedures, including amendments and policies with
retroactive effect, that the Company reasonably determines are necessary or
appropriate to (i) exempt the compensation and benefits payable under this
Agreement from Section 409A and/or preserve the intended tax treatment of the
compensation and benefits provided with respect to this Agreement or (ii) comply
with the requirements of Section 409A.
10.2
Separation from
Service under 409A. Notwithstanding any provision to the
contrary in this Agreement:
(a) No
amount shall be payable pursuant to Section 4.1 unless the termination of
Executive’s employment constitutes a “separation from service” within the
meaning of Section 1.409A-1(h) of the Department of Treasury Regulations;
and
(b) If
the Executive is deemed at the time of his separation from service to be a
“specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, to
the extent delayed commencement of any portion of the termination benefits to
which the Executive is entitled under this Agreement (after taking into account
all exclusions applicable to such termination benefits under Section 409A),
including, without limitation, any portion of the additional compensation
awarded pursuant to Section 4.1, is required in order to avoid a prohibited
distribution under Section 409A(a)(2)(B)(i) of the Code, such portion of the
Executive’s termination benefits shall not be provided to the Executive prior to
the earlier of (A) the expiration of the six-month period measured from the date
of the Executive’s “separation from service” with the Company (as such term is
defined in the Department of Treasury Regulations issued under Section 409A of
the Code) or (B) the date of the Executive’s death. Upon the earlier
of such dates, all payments deferred pursuant to this Section 10.2(b) shall be
paid in a lump sum to the Executive, and any remaining payments due under the
Agreement shall be paid as otherwise provided herein; and
(c) The
determination of whether the Executive is a “specified employee” for purposes of
Section 409A(a)(2)(B)(i) of the Code as of the time of his separation from
service shall be made by the Company in accordance with the terms of Section
409A of the Code and applicable guidance thereunder (including, without
limitation, Section 1.409A-1(i) of the Department of Treasury Regulations (and
any successor provision thereto); and
(d) For
purposes of Section 409A, the Executive’s right to receive installment payments
pursuant to Section 4.1 shall be treated as a right to receive a series of
separate and distinct payments.
[signature
page follows]
11
IN
WITNESS WHEREOF, the Company and Group have caused this Agreement to be duly
executed by their authorized representatives and the Executive has hereunto set
his hand, in each case effective as of the day and year first above
written.
|
ATLANTIC
EXPRESS
TRANSPORTATION
GROUP INC.
|
|||
|
|
By:
|
/s/ Xxxxx Xxxxx | |
| Name: Xxxxx Xxxxx | |||
| Title: Chairman of the Board | |||
|
ATLANTIC
EXPRESS
TRANSPORTATION
CORP.
|
|||
|
|
By:
|
/s/ Xxxxx Xxxxx | |
| Name: Xxxxx Xxxxx | |||
| Title: Chairman of the Board | |||
| EXECUTIVE: | |||
|
|
By:
|
/s/ Xxxxxxx Xxxxx | |
| Xxxxxxx Xxxxx | |||
12
