EXHIBIT 10.9
THIS AGREEMENT MADE EFFECTIVE THE 9TH DAY OF DECEMBER 2002.
Between:
Xxxxxxx Inc., a corporation duly incorporated under the laws of Canada
and it's successor companies ("LINC")
and
Xxxxxxx X Xxxxx (the "Executive")
WHEREAS, LINC desires to employ the Executive and the Executive desires to be
employed by LINC;
NOW THEREFORE, the parties have agreed that the terms and conditions of the
relationship shall be as follows:
ARTICLE 1 -- DEFINITIONS
Whenever used in this Agreement, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word is
capitalized:
(a) "Agreement" means this employment agreement, as amended from time to
time.
(b) "Base Salary" means the salary of record paid to the Executive as
annual salary, and as further indicated in paragraph (a) of Article 4
(Compensation).
(c) "Board" means the Board of Directors of LINC.
(d) "Cause" means the Executive's:
(i) Willful and continued failure to perform substantially the
Executive's duties with LINC after LINC delivers to the
Executive written demand for substantial performance,
specifically identifying the manner in which the Executive has
not substantially performed his duties;
(ii) Conviction of an indictable offense; or
(iii) Willfully engaging in illegal conduct or gross misconduct
which is materially and demonstrably injurious to LINC.
For purposes of this paragraph and Article 13, no act or omission by
the Executive shall be considered "willful" unless it is done or
omitted in bad faith or without reasonable belief that the Executive's
action or omission was in the best interests of LINC.
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(e) "Committee" means the Compensation Committee of the Board.
(f) "Effective Date" means January 1, 2003.
(g) "Executive" shall mean Xxxxxxx X Xxxxx.
ARTICLE 2 -- TERM OF THE AGREEMENT
The term of this Agreement shall commence on the Effective Date and shall
continue until terminated in accordance with the provisions of this Agreement.
ARTICLE 3 -- TITLE; COMMENCEMENT OF EMPLOYMENT; REPORTING
The Executive shall serve as the Senior Vice President and Chief Financial
Officer of LINC. The Executive's employment shall commence on the Effective
Date. The Executive shall report to the Chief Executive Officer of LINC.
ARTICLE 4 -- COMPENSATION
(a) Unless otherwise provided, all dollar amounts set forth in this
Agreement shall be in United States Dollars. The Base Salary of the
Executive for his services is established by the Committee at the
annualized rate of $400,000. The Base Salary shall be payable twice
monthly on the 15th business day and the last business day of each
month. The Base Salary shall be reviewed annually during LINC's normal
review period. The review will be undertaken by assessing the
Executive's achievement of the overall objectives established by the
Committee in consultation with the Executive and with regard to the
market rates of remuneration paid for similar duties and
responsibilities.
(b) The Executive will be eligible to participate in LINC's Short Term
Incentive Plan. For fiscal years commencing September 1, 2002 and
thereafter, the Executive's target bonus shall be 75% of Base Salary
and the maximum bonus shall be 150% of Base Salary. The Executive's
right to receive any bonus under LINC's Short Term Incentive Plan shall
be determined based only upon quantitative measurements established by
the Committee after consultation with the Executive and as set forth in
accordance with LINC's Short Term Incentive Plan.
(c) The Executive shall participate in The Supplemental Executive
Retirement Plan sponsored by LINC for the benefit of its employees.
(d) Subject to approval by the Committee, the Executive will be eligible to
receive grants of stock options from time to time. Such stock options
will be on terms and conditions established by the Committee after
consultation with the Executive.
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ARTICLE 5 -- BENEFITS
(a) AUTOMOBILE
LINC will provide the Executive with a monthly allowance of One
Thousand Dollars ($1,000.00) for expenses incurred by the Executive for
an automobile and its related operating and insurance expenses.
(b) EXPENSES
It is understood and agreed that the Executive will incur expenses in
connection with his duties under this Agreement, including, but not
limited to, travel expenses, home facsimile expenses, personal computer
expenses and telephone expenses. LINC shall reimburse the Executive for
any such expenses provided that the Executive provides to LINC an
itemized written account and receipts acceptable to LINC.
(c) VACATION
The Executive shall be entitled to five (5) weeks vacation during each
calendar year, pro-rated, however, for the first year of service,
vacation entitlement will be based on the number of days employed in
such year. The vacation "shall be taken at the discretion of the
Executive with the understanding that the Executive will take into
account business needs and operations in scheduling vacation.
(d) WELFARE BENEFITS
The Executive shall be entitled to those welfare benefit coverages as
are offered by LINC to its employees generally (such as medical
insurance, dental insurance, short and long-term disability insurance
and group term life insurance), all in accordance with the employee
benefit plans and policies maintained by LINC for the benefit of
employees of LINC, and as amended from time to time.
(e) CLUB MEMBERSHIP
LINC will reimburse the Executive for up to an aggregate amount of
Forty Thousand Dollars ($40,000.00) of expenses incurred by the
Executive for the initial membership fees associated with joining one
business club and one recreational club that the Executive will use in
connection with LINC's business. LINC will also reimburse the Executive
for ongoing annual dues incurred by the Executive in connection with
the Executive's membership in such business club and recreational club.
(f) PROFESSIONAL EXPENSES
LINC will reimburse the Executive for up to Seven Thousand Five Hundred
Dollars ($7,500.00) annually for expenses incurred by the Executive in
connection with the Executive's tax preparation and planning.
(g) EXECUTIVE RELOCATION ALLOWANCE
The Executive shall relocate to the Chicago area, which has been chosen
to be LINC's future corporate headquarters. The Executive shall
relocate within eight months following the date of commencing
employment with LINC. The Executive shall be entitled to reimbursement
of customary moving and transportation expenses and closing costs in
connection with the Executive's relocation. The Executive will also be
entitled to
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the reimbursement of reasonable costs incurred in commuting to and from
his current home to the corporate headquarters until he relocates to
the Chicago area.
ARTICLE 6 -- TERMINATION OF EMPLOYMENT
(a) The parties understand and agree that this Agreement and the
Executive's employment hereunder may be terminated in the following
manner in the specified circumstances:
(i) By the Executive, at any time, for any reason, on the giving
of 90 days' written notice to LINC. LINC may waive notice, in
whole or in part, upon immediate payment to the Executive of
the Executive's Base Salary for such portion of the 90-day
notice period as is waived by LINC.
(ii) By LINC, in its absolute discretion, without any notice or pay
in lieu thereof, for Cause.
(iii) By LINC, in its absolute discretion and for any reason,
without Cause. Upon such termination, LINC shall continue to
pay the Executive his Base Salary in effect at the time of
such termination for a period of 24 months following such
termination and shall continue to provide the Executive
medical insurance, dental insurance and term life insurance
for a period of 24 months after termination, or, if such
benefits cannot be provided by LINC, LINC shall pay to the
Executive an equivalent lump sum cash amount in lieu of such
benefits. In addition, if such termination occurs on or prior
to the first anniversary of the Effective Date, LINC shall
reimburse the Executive for reasonable and actual relocation
expenses to Canada (or a destination of the Executive's choice
of equal or lesser cost), subject to LINC's relocation policy
and guidelines as in effect from time to time.
In order to receive the entitlement under this paragraph, the Executive
must undertake to sign a release in a form satisfactory to LINC, fully
releasing LINC from further claims upon payment of the amounts
stipulated herein. However, the form of release shall not require that
the Executive give up any rights of indemnity which the Executive may
have had as against LINC for acts carried out by the Executive in the
ordinary course of LINC's business.
(b) The Executive agrees that during employment pursuant to this Agreement
and for twenty-four (24) months following termination without Cause of
his employment by LINC and payment of the severance payment amount and
benefit continuation as detailed in subparagraph (iii) of paragraph (a)
of Article 6 (Termination of Employment), he will not solicit or accept
business with respect to products competitive with those of LINC from
any of LINC's customers, wherever situated, and he shall not either
individually or in partnership, or jointly in conjunction with any
other person, entity or organization, as principal, agent, consultant,
lender, contractor, employer, employee, investor, shareholder, or in
any other manner, directly or indirectly, advise, manage, carry on,
establish, control, engage in, invest in, offer financial assistance or
services to, or permit his name to be used by any business that
competes with the then-existing business of LINC, provided that the
Executive shall be entitled, for investment purposes, to purchase and
trade shares of a public company which are listed and posted for
trading on a
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recognized stock exchange and the business of which public company may
be in competition with the business of LINC, provided that the
Executive shall not directly or indirectly own more than five percent
(5%) of the issued share capital of the public company, or participate
in its management or operation, or in any advisory capacity within the
time limits set out herein.
For purposes of the obligations set out herein, the business of LINC
shall mean the provision of contract bus services for school bus
transportation throughout Canada and the United States and municipal
and paratransit bus transportation within the United States, inter-city
and tourism bus transportation throughout North America and healthcare
transportation services and emergency management services in the United
States.
(c) The Executive further agrees that for a period of twenty-four (24)
months following termination of employment, however caused, he will not
solicit for hire or rehire, or take away, or cause to be hired, or
taken away, any employee of LINC.
ARTICLE 7 -- AUTHORITY
(a) The Executive shall support the chief Executive Officer in carrying out
the general or specific instructions and directions of the Board and,
together with the Chief Executive Officer, in doing so, may enter into
contracts, engagements or commitments of every nature or kind, in the
name of and on behalf of LINC, and may engage, employ and dismiss all
managers and other employees and agents of LINC, subject to the by-laws
and charter documents of the Company.
(b) The Executive shall conform to all lawful instructions and directions
given to him by the Board or Chief Executive Officer and will obey and
carry out the by-laws of LINC.
ARTICLE 8 -- SERVICE
(a) The Executive, throughout the term of his employment, shall devote his
full time and attention to the business and affairs of LINC, and shall
not undertake any other business or occupation or, unless approved by
the Chief Executive Officer, become either (i) an officer, employee or
agent of any other company or firm which is a commercial venture or
(ii) a director of more than two companies or firms which are
commercial ventures.
(b) The Executive shall well and faithfully serve LINC and use his best
efforts to promote the interests thereof and shall not disclose any
information he may acquire in relation to LINC's business, the private
affairs or trade secrets of LINC, techniques and concepts, and other
confidential information concerning the business, operations or
financing of LINC, to any person other than the Board, or for any
purposes other than those of LINC, either during the term of his
employment under this Agreement or after such term.
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ARTICLE 9 - CHANGE IN CONTROL
(a) If a change in control (as defined in the Change in Control Agreement)
occurs, the rights and obligations of the Executive and LINC shall be
in accordance with the Change in Control Agreement attached as Appendix
A.
(b) In order to receive the entitlement under this paragraph, the Executive
must undertake to sign a release in a form satisfactory to LINC, fully
releasing LINC from further claims upon payment of the amounts
stipulated in Appendix A. However, the form of release shall not
require that the Executive give up any rights of indemnity which the
Executive may have had as against LINC for acts carried out by the
Executive in the ordinary course of LINC's business.
If a change in control occurs and Executive receives all payments under the
Change in Control Agreement, the Executive hereby waives any rights he may have
to any payments or other benefits under this Agreement, including any severance
payments.
ARTICLE 10 -- ASSIGNMENT OF RIGHTS
The rights which accrue to LINC under this Agreement shall pass to their
affiliates, successors or assigns. The rights of the Executive under this
Agreement are not assignable or transferable in any manner but flow to the
Executive's estate and heirs.
ARTICLE 11 -- NOTICES
All notices and other communications required or permitted hereunder, or
necessary or convenient in connection herewith, shall be in writing and shall be
deemed to have been given when hand delivered, delivered by facsimile or mailed
by registered mail as follows (provided that notice of change of address shall
be deemed given only when received):
If to LINC, to:
Xxxxxxx Inc.
00 Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx
XXX, 00000
If to the Executive, to:
Xxxxxxx X Xxxxx
00 Xxxxx Xxxxx Xxxx
Xxx, Xxx Xxxx
00000
or to such other names or addresses as LINC or the Executive shall designate by
notice to the other in the manner specified in this paragraph.
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ARTICLE 12 -- LIABILITY INSURANCE
LINC shall maintain the Executive's liability insurance in accordance with
LINC's corporate policy and applicable law.
ARTICLE 13 -- INDEMNIFICATION
LINC agrees that if the Executive is made a party to any action, suit,
proceeding or any other claim whatsoever, by reason of the fact that the
Executive is or was a director, officer, employee or agent of LINC, or is or was
serving at the request of LINC as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
whether or not the basis of such claim is the Executive's alleged action in an
official capacity while in service as a director, officer, employee or agent of
LINC, the Executive shall be indemnified and held harmless by LINC to the
fullest extent legally permitted or authorized by LINC's certificate of
incorporation or bylaws or Board resolutions against all expenses, liability and
loss, including, without limitation, legal fees, fines or penalties and amounts
paid or to be paid in settlement, all as reasonably incurred by the Executive in
connection therewith, and such indemnification shall continue as to the
Executive even after the Executive has ceased to be a director, officer,
employee or agent of LINC, and shall inure to the benefit of the Executive's
heirs, executors and administrators.
ARTICLE 14 -- WITHHOLDING OF TAXES
LINC shall be entitled to withhold from any amounts payable under this Agreement
all taxes as legally shall be required pursuant to applicable federal, state or
local laws. LINC shall not be obligated to compensate the Executive for the
payment of such taxes.
ARTICLE 15 -- SEVERABILITY
If any provision of this Agreement or the application thereof to anyone, or
under any circumstances, is adjudicated to be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect any other
provision or application of this Agreement which can be given effect without the
invalid or unenforceable provision or application and shall not invalidate or
render unenforceable such provision or application in any other jurisdiction.
ARTICLE 16 -- ENTIRE AGREEMENT
This Agreement, including Appendix A hereto, constitutes the entire agreement
between the parties with respect to the employment and appointment of the
Executive and any and all previous agreements, written or oral, express or
implied, between the parties or on their behalf, relating to the employment and
appointment of the Executive by LINC, are terminated and cancelled and each of
the parties releases and forever discharges the other of and from all manner of
actions, causes of action, claims and demands whatsoever, under or in respect of
any previous agreement.
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ARTICLE 17 -- AMENDMENT, WAIVER, ETC.
No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by the
Executive and LINC. No waiver by any party hereto at any time of any breach by
any other party hereto of, or compliance with, any condition of this Agreement
to be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
ARTICLE 18 - HEADINGS
The headings used in this Agreement are for convenience only and are not to be
construed in any way as additions to or limitations of the covenants and
agreements contained in it.
ARTICLE 19 -- COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and
the same instrument.
ARTICLE 20 -- GENDER AND NUMBER
Except where otherwise indicated by the context, any masculine term used herein
shall also include the feminine; the plural shall include the singular, the
singular shall include the plural.
ARTICLE 21 -- GOVERNING LAW
This Agreement shall be governed by the internal law, and not the laws of
conflicts, of the State of Delaware.
IN WITNESS WHEREOF, the parties have executed this Agreement on the 9th day of
December 2002.
XXXXXXX INC.
BY: /s/ X. XXXXXX
---------------------------
NAME: X. XXXXXX
TITLE: PRESIDENT AND CEO
XXXXXXX X. XXXXX
/s/ X. X. Xxxxx
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