EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is dated as of June
1, 1998, between First Aviation Services Inc. ("FAvS" or "the Company"), and
Xxxxxx X. Xxxxxx, an individual (the "Executive").
WITNESSETH:
WHEREAS, the Company believes that the Executive will be a valued employee
of the Company and wishes to secure his employment with the Company and document
the terms of the Executive's employment by the Company.
WHEREAS, the Company also has determined that it is in the best interests
of the Company and its shareholders to reinforce and encourage the continued
attention and dedication of certain key members of the Company's management,
including the Executive, to their assigned duties without distraction in
uncertain circumstances arising from the possibility of a change in control of
the Company.
NOW, THEREFORE, taking into account the foregoing and in consideration of
the mutual promises and conditions contained herein, the parties hereto agree as
follows:
I
EMPLOYMENT
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.1 Employment. The Company employs the Executive and the Executive hereby
accepts employment as a vice president upon the terms and conditions hereinafter
set forth.
.2 Term. The employment of the Executive by the Company under the terms and
conditions of this Agreement will commence on the date hereof and continue,
subject to Article IV hereof, for a period of three years ("Employment Term").
.3 Executive Duties. As a vice president of the Company, the Executive
shall perform such duties as are requested by and shall report directly to the
Company's Senior Vice President. The Executive agrees to devote his full
business time (with allowances for vacations and sick leave) and attention and
best efforts to the affairs of the Company during the Employment Term. Executive
shall not, while an employee of the Company, directly or indirectly, be engaged
(including as a stockholder, proprietor, general partner, limited partner,
trustee, consultant, employee, director, officer, lender, investor or otherwise)
in any business or activity that is competitive with that of the Company or any
of its subsidiaries or affiliates.
II
COMPENSATION AND BENEFITS
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.1 Annual Salary. During the Employment Term, the Company shall pay to the
Executive a base salary at the rate of One Hundred Fifty Thousand Dollars
($150,000) per year (the "Annual Salary"), payable in substantially equal
biweekly installments. The Company will review annually and may, in the sole
discretion of the Board of Directors of the Company, increase such base salary
in light of the Executive's performance, inflation in cost of living or other
factors.
.2 Benefits. Subject to the sole discretion of the Board of Directors,
during the Employment Term, the Executive may be permitted to participate in and
be covered under any and all such performance, bonus, profit sharing, incentive
stock option, and other compensation plans and such medical, dental, disability,
life, and other insurance plans and such other benefits generally available to
other employees of the Company in similar employment positions, as the Board of
Directors shall determine, subject to meeting applicable eligibility
requirements (collectively referred to herein as the "Company Benefit Plans").
.3 Reimbursement of Expenses. The Executive shall be entitled to receive
prompt reimbursement of all reasonable expenses incurred by the Executive in
performing services hereunder, including all reasonable expenses of travel,
entertainment and living expenses while away from home on business at the
request of, or in the service of, the Company, provided that such expenses are
incurred and accounted for in accordance with the policies and procedures
established by the Company.
.4 Vacation and Holidays. The Executive shall be entitled to an annual
vacation leave of three (3) weeks at full pay or such greater vacation benefits
as may be provided for by the Company's vacation policies applicable to senior
executives of the Company. Up to a maximum of one week of vacation time may be
accumulated and carried over from one year to the next. Executive shall be
entitled to such holidays as are established by the Company for all employees.
III
CONFIDENTIALITY AND NONDISCLOSURE
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.1 Confidentiality. Executive shall not, during Executive's employment by
the Company or thereafter, at any time disclose, directly or indirectly, to any
person or entity or use for Executive's or any other person's or entity's
benefit any trade secrets or confidential information relating to the Company,
its subsidiaries' or affiliates' businesses, operations, marketing data,
business plans, strategies, employees, products, prices, negotiations and
contracts with other companies, or any other subject matter pertaining to the
business of the Company or its subsidiaries or affiliates or any of their
respective clients, customers, suppliers, consultants, or licensees, known,
learned, or acquired by Executive during the period of Executive's employment by
the Company (collectively "Confidential Information"), except as may be
necessary in the ordinary course of performing Executive's particular duties as
an employee of the Company.
.2 Return of Confidential Material. Executive shall promptly deliver to the
Company on termination of Executive's employment by the Company, whether or not
for Cause, or at any time the Company may so request, all correspondence,
workpapers, memoranda, notes, records, reports, manuals, drawings, blueprints,
computer files and records, Confidential Information and any other documents of
a confidential nature belonging to the Company or its subsidiaries or
affiliates, including all copies of such materials which Executive may then
possess or have under Executive's control and any notes of Executive relating
thereto except for information in the public domain and any such information
brought with the executive prior to his employment with the company. Upon
termination of Executive's employment by the Company, Executive shall not retain
any document, data, or other material of any nature containing or pertaining to
the proprietary information of the Company or its subsidiaries or affiliates.
.3 Prohibition on Solicitation of Customers; Noncompetition. During the
term of Executive's employment by the Company, and for a period of six months
thereafter, Executive shall not, directly or indirectly, either for Executive or
for any other person or entity, solicit any person or entity to terminate such
person's or entity's contractual and/or business relationship with the Company
or its subsidiaries or affiliates, nor shall Executive interfere with or disrupt
or attempt to interfere with or disrupt any such relationship. In addition, for
a period of six months following the term of Executive's employment by the
Company, Executive shall not, directly or indirectly, be engaged (including as a
stockholder, proprietor, general partner, limited partner, trustee, consultant,
employee, director, officer, lender, investor or otherwise) in any business or
activity that is competitive with that of the Company, its subsidiaries' or
affiliates activities within North America. None of the foregoing shall be
deemed a waiver of any rights and remedies the Company may have under applicable
law.
.4 Prohibition on Solicitation of Employees, Agents or Independent
Contractors After Termination. During the term of Executive's employment by the
Company and for a period of six months following the termination of Executive's
employment by the Company, Executive will not solicit any of the employees,
agents, or independent contractors of the Company or its subsidiaries or
affiliates to leave the employ of the Company or its subsidiaries or affiliates.
However, Executive may solicit any employee, agent or independent contractor who
voluntarily terminates his or her employment with the Company or its
subsidiaries or affiliates after a period of 180 days have elapsed since the
termination date of such employee, agent or independent contractor. None of the
foregoing shall be deemed a waiver of any rights and remedies the Company may
have under applicable law.
.5 Right to Injunctive and Equitable Relief. Executive's obligations not to
disclose or use Confidential Information and to refrain from the solicitations
described in this Article III are of a special and unique character. The Company
and its subsidiaries and affiliates cannot be reasonably or adequately
compensated for damages in an action at law in the event Executive breaches such
obligations. Therefore, Executive expressly agrees that the Company and its
subsidiaries and affiliates shall be entitled to injunctive and other equitable
relief without bond or other security in the event of such breach in addition to
any other rights or remedies which the Company or its subsidiaries or affiliates
may possess or be entitled to pursue. Furthermore, the obligations of Executive
and the rights and remedies of the Company and its subsidiaries and affiliates
under this Article III are cumulative and in addition to, and not in lieu of,
any obligations, rights, or remedies created by applicable law relating to
misappropriation or theft of trade secrets or Confidential Information. The
parties agree that the Company and all of the subsidiaries and affiliates of the
Company shall be third party beneficiaries of this Section III and be entitled
to enforce directly against Executive the provisions of this Section III to the
extent that shall be related to the business of the Company, its subsidiaries or
affiliates.
.6 Survival of Obligations. Executive agrees that the terms of this Article
III and Article V hereof shall survive the term of this Agreement and the
termination of Executive's employment by the Company.
IV
TERMINATION
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.1 Definitions. For purposes of this Article IV, the following
definitions shall be applicable to the terms set forth below:
(a) Cause. "Cause" shall mean only the following: (i) continued
failure by the Executive after receipt of written notice thereof to
perform his duties hereunder or those duties which may, from time to
time, be reasonably requested by the Senior Vice President of the
Company (other than such failure resulting from the Executive's
incapacity due to physical or mental illness), as determined by the
members of the Board of Directors in their reasonable discretion; (ii)
misconduct by the Executive which is injurious to the Company; (iii)
conviction of or pleading no contest to a felony or crime of moral
turpitude; (iv) drunkenness or drug use on the job by the Executive;
(v) action by the Executive beyond the scope of his employment, as
such scope is set by the Senior Vice President of the Company from
time to time (vi) a breach of this Agreement by the Executive.
(b) Disability. "Disability" shall mean a physical or mental
incapacity as a result of which the Executive becomes unable to
continue the proper performance of his duties hereunder (reasonable
absences because of sickness for up to three (3) consecutive months
excepted). A determination of Disability shall be subject to the
certification of a qualified medical doctor agreed to by the
Company and the Executive or, in the event of the Executive's
incapacity to designate a doctor, the Executive's legal
representative. In the absence of agreement between the Company
and the Executive, each party shall nominate a qualified medical
doctor and the two doctors so nominated shall select a third
doctor, who shall make the determination as to Disability.
.2 Termination by Company. The Executive's employment hereunder may be
terminated by the Company immediately for Cause. Subject to the provisions
contained in Section IV (.3) (b) of this Agreement, the Company may
terminate this Agreement at any time for any reason other than Cause upon
thirty (30) days' written notice to Executive. The effective date of
termination ("Effective Date") shall be considered to be thirty (30) days
subsequent to written notice of termination; however, the Company may elect
to have Executive leave the Company and its subsidiaries immediately upon
issuance of the aforementioned written notice.
.3 Severance Benefits Received Upon Termination.
(a) If at any time the Executive's employment is terminated by
the Company for Cause, the Company shall pay the Executive his Annual
Salary prorated through the date such termination occurs plus payment
for any vacation earned but not taken and the Company shall thereafter
have no further obligations under this Agreement to the Executive or
his or her dependents, beneficiaries or estate; provided, however,
that the Company will continue to honor any obligations that may have
been accrued and vested under then existing Company Benefit Plans or
any other agreements or arrangements applicable to the Executive.
(b) If at any time the Executive's employment is terminated by
the Company without Cause or as a result of death or Disability, then
the Company shall:
(1) pay to the Executive for termination of his rights
hereunder a lump sum, in cash, within seven business days
following the date of termination, in an amount equal to six
months' salary based upon the Executive's current "Monthly Base
Salary" (defined as the Annual Salary in effect on the date of
termination divided by twelve (12)), plus payment for any
vacation earned but not taken, and in addition, the Company will
continue to honor any obligations that may have been accrued and
vested under then existing Company Benefit Plans or any other
agreements or arrangements applicable to the Executive.
(2) provide Executive with such insurance coverage as is
then required by COBRA or any similar then applicable law.
.4 No Obligation to Mitigate Damages; No Effect on Other Contractual
Rights.
(a) The Executive shall not be required to mitigate damages or
the amount of any payment provided for under this Agreement by seeking
other employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by the Executive as the result of employment by another
employer after the date of termination, or otherwise.
(b) The provisions of this Agreement, and any payment or benefit
provided for hereunder, shall not reduce any amounts otherwise
payable, or in any way diminish the Executive's existing rights, or
rights which would accrue solely as a result of the passage of time,
under any Company Benefit Plan or other contract, plan or arrangement.
(c) Executive may terminate this Agreement upon 30 days written
notice to the Company and upon such termination the Company shall make
the payment provided for in Section IV (.3)(a) only hereof and no
further payments shall be required to be made by the Company to
Executive.
V
GENERAL PROVISIONS
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.1 Notice. For purposes of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, as follows:
If to the Company:
Xxxxxx X. Xxxxxxxxxxx
Senior Vice President
First Aviation Services Inc.
00 Xxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
If to the Executive:
Xxxxxx X. Xxxxxx
0000 Xxxxx Xxxx Xxxx
Xxxxxx, XX 00000
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
.2 No Waivers. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in a
writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision 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.
.3 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Connecticut without regard to conflicts
of law principles. Executive hereby agrees to submit to the exclusive
jurisdiction of the courts in and of the State of Tennessee, and consents that
service of process with respect to all courts in and of the State of Tennessee
may be made by registered mail to Executive at his address for notices specified
herein.
.4 Severability or Partial Invalidity. The invalidity or unenforceability
of any 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.
.5 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.
.6 Legal Fees and Expenses. Should any party institute any action or
proceeding to enforce this Agreement or any provision hereof, or for damages by
reason of any alleged breach of this Agreement or of any provision hereof, or
for a declaration of rights hereunder, the prevailing party in any such action
or proceeding shall be entitled to receive from the other party all costs and
expenses, including reasonable attorneys' fees, incurred by the prevailing party
in connection with such action or proceeding.
.7 Entire Agreement. This Agreement constitutes the entire agreement of the
parties and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings, and negotiations between the parties with respect to
the subject matter hereof. This Agreement is intended by the parties as the
final expression of their agreement with respect to such terms as are included
in this Agreement and may not be contradicted by evidence of any prior or
contemporaneous agreement. The parties further intend that this Agreement
constitutes the complete and exclusive statement of its terms and that no
extrinsic evidence may be introduced in any judicial proceeding involving this
Agreement.
.8 Assignment. This Agreement and the rights, duties, and obligations
hereunder may not be assigned or delegated by any party without the prior
written consent of the other party. Notwithstanding the foregoing provisions of
this Section 5.8, the Company may assign or delegate its rights, duties, and
obligations hereunder to any person or entity which succeeds to all or
substantially all of the business of the Company through merger, consolidation,
reorganization, or other business combination or by acquisition of all or
substantially all of the assets of the Company; provided that such person
assumes the Company's obligations under this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
FIRST AVIATION SERVICES INC.
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Chief Executive Officer
Xxxxxx X. Xxxxxx
an individual
/s/ Xxxxxx X. Xxxxxx
