EXHIBIT 10.23.1
CHANGE OF CONTROL AGREEMENT
This Change of Control Agreement (the "Agreement") is made and entered into
September 27, 2000 by and between XxXxxxx Aircraft Holdings, Inc. (the
"Company") and Xxxx Xxxxxx ("Executive") based on the following facts:
A. Executive is currently employed by the Company in the capacity as
Director of Planning and Analysis and is a key executive of the
Company.
B. The Company desires to define the terms and conditions of any
termination of employment upon a Change of Control (as defined herein)
in the Company.
Based on the foregoing facts and circumstances and for good and valuable
consideration, receipt of which is hereby acknowledged, the Company and
Executive agree as follows:
1. TERM OF AGREEMENT. Except as otherwise provided herein, the term of
this Agreement shall commence effective the date hereof and shall
continue for one year (the "Term").
2. A. COMPENSATION UPON TERMINATION FOLLOWING A CHANGE OF CONTROL. In
the event that (i) a Change of Control shall have occurred during
the term of this Agreement and while Executive is employed by the
Company and (ii) the Executive's employment shall be
involuntarily terminated for any reason on a date which is less
than one year after the date of the Change of Control (whether
during or after the term of this Agreement) other than for Cause,
death or disability or Executive shall terminate his employment
for Good Reason, then the Company shall make the following
payments to Executive within 15 days following the date of such
termination of employment (the "Termination Date"), subject in
each case to any applicable payroll or other taxes required to be
withheld.
(1) The Company shall pay Executive a lump sum amount in cash
equal to the sum of (a) Executive's monthly base salary
multiplied by a number equal to 12 minus the number of whole
months elapsed from the date of the Change of Control to the
Termination Date (the "Multiplier") and (b) Executive's
average annual bonus including in such average any such
annual bonus earned (even though such bonus may be paid in
the year following the year in which earned), (computed over
the shorter of (x) the period of Executive's employment by
the Company or (y) five calendar years each as measured to
the day immediately preceding the Termination Date) divided
by 12 and multiplied by the Multiplier.
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(2) The Company shall pay Executive a lump sum amount in cash
equal to accrued but unpaid salary and bonus through the
Termination Date, and unpaid salary with respect to any
vacation days accrued but not taken as of the Termination
Date.
B. DEFINITIONS.
(1) As used in this Agreement, "Change of Control" shall
mean an event involving the Company of a nature that
would be required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), assuming that such Schedule,
Regulation and Act applied to the Company, provided
that such a Change of Control shall be deemed to have
occurred at such time as: (i) any "person" (as that
term is used in Sections 13(d) and 14(d)(2) of the
Exchange Act) (other than an Excluded Person (as
defined below)) becomes, directly or indirectly, the
"beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act) of securities representing 20% or more of
the combined voting power for election of members of
the Board of Directors of the then outstanding voting
securities of the Company or any successor of the
Company, excluding any person whose beneficial
ownership of securities of the Company or any successor
is obtained in a merger or consolidation not included
in paragraph (iii) below; (ii) during any period of two
consecutive years or less, individuals who at the
beginning of such period constituted the Board of
Directors of the Company cease, for any reason, to
constitute at least a majority of the Board, unless the
appointment, election or nomination for election of
each new member of the Board (other than a director
whose initial assumption of office is in connection
with an actual or threatened election contest,
including but not limited to a consent solicitation,
relating to the election of directors of the Company)
was approved by a vote of at least two-thirds of the
members of the Board of Directors then still in office
who were members of the Board at the beginning of the
period or whose appointment, election or nomination was
so approved since the beginning of such period; (iii)
there is consummated any merger, consolidation or
similar transaction to which the Company is a party as
a result of which the persons who were equity holders
of the Company immediately prior to the effective date
of the merger or consolidation shall have beneficial
ownership of less than 50% of the combined voting power
for election of members of the Board of Directors (or
equivalent) of the surviving entity or its parent
following the effective date of such merger or
consolidation; (iv) any sale or other disposition (or
similar
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transaction) (in a single transaction or series of
related transactions) of (x) 50% or more of the assets
or earnings power of the Company or (y) business
operations which generated a majority of the
consolidated revenues (determined on the basis of the
Company's four most recently completed fiscal quarters
for which reports have been completed) of the Company
and its subsidiaries immediately prior thereto, other
than a sale, other disposition, or similar transaction
to an Excluded Person or to an entity of which
equityholders of the Company beneficially own at least
50% of the combined voting power; (v) any liquidation
of the Company. For purposes of this definition of
Change of Control, the term "Excluded Person" shall
mean and include (i) any corporation beneficially owned
by shareholders of the Company in substantially the
same proportion as their ownership of shares of the
Company and (ii) the Company.
(2) As used in this Agreement, "Good Reason" shall mean the
occurrence, following a Change of Control, of any one
of the following events without Executive's consent:
(i) the Company assigns Executive to any duties
substantially inconsistent with his position, duties,
responsibilities, status or reporting responsibility
with the Company immediately prior to the Change of
Control, or assigns Executive to a position that does
not provide Executive with substantially the same or
better compensation, status, responsibilities and
duties as Executive enjoyed immediately prior to the
Change of Control; (ii) the Company reduces the amount
of Executive's base salary as in effect as of the date
of the Change of Control or as the same may be
increased thereafter from time to time, except for
across-the-board salary reductions similarly affecting
all senior executives of the Company; (iii) the Company
fails to pay Executive an annual bonus consistent with
past practices and bonuses consistent with past
practices are paid to any other senior executives of
the Company; (iv) the Company changes the location at
which Executive is employed by more than 50 miles from
the location at which Executive is employed as of the
date of this Agreement; or (v) the Company breaches
this Agreement in any material respect, including
without limitation failing to obtain a succession
agreement from any successor to assume and agree to
perform this Agreement.
(3) For Cause. As used in this Agreement, "Cause" shall
mean (i) any material act of dishonest constituting a
felony (of which Executive is convicted or pleads
guilty) which results or is intended to result directly
or indirectly in substantial gain or personal
enrichment to Executive at the expense of the Company,
or (ii) after notice of
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breach delivered to Executive specifying in reasonable
detail and a reasonable opportunity for Executive to
cure the breaches specified in the notice, the Board,
acting by a two thirds vote, after a meeting held for
the purpose of making such determination and after
reasonable notice to Executive and an opportunity for
him together with his counsel to be heard before the
Board, determines, in good faith, other than for
reasons of physical or mental illness, Executive
willfully and continually fails to substantially
perform his duties pursuant to this Agreement and such
failure results in demonstrable material injury to the
Company. The following shall not constitute Cause: (i)
Executive's bad judgment or negligence, (ii) any act or
omission by Executive without intent of gaining
therefrom directly or indirectly a profit to which
Executive was not legally entitled, (iii) any act or
omission by Executive with respect to which a
determination shall have been made that Executive met
the applicable standard of conduct prescribed for
indemnification or reimbursement of payment of expenses
under the By-Laws of the Company or the laws of the
State of Delaware as in effect at the time of such act
or omission.
3. MITIGATION. Executive is not required to seek other employment or
otherwise mitigate the amount of any payments to be made by the
Company pursuant to this Agreement.
4. ASSIGNMENT. Neither Company nor Executive shall have the right to
assign its respective rights pursuant to this Agreement. The Company
shall require any proposed successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially
all of the business and/or assets of the Company, by agreement in form
and substance reasonably satisfactory to Executive, to expressly
assume and agree to perform this agreement in the same manner and to
the same extent that the Company would be required to perform it if no
such succession had taken place, concurrent with the execution of a
definitive agreement with the Company to engage in such transaction.
5. This Agreement shall be binding on the inure to the benefit of
Executive and his heirs and the Company and any permitted assignee.
The Company shall not engage in any transaction, including a merger or
sale of assets unless, as a condition to such transaction such
successor organization assumes the obligations of the Company pursuant
to this Agreement.
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6. NOTICES.
If to Company: XxXxxxx Aircraft Holdings, Inc.
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xx Xxxxxxx, XX 00000
Attention: Chief Financial Officer
Fax: 000-000-0000
If to Executive: Xxxx Xxxxxx
__________________________________
__________________________________
Fax: ____________________________
7. FACSIMILE SIGNATURES, EXECUTION AND DELIVERY. This Agreement shall be
effective upon transmission of a signed facsimile by one party to the
other.
8. MISCELLANEOUS. This Agreement supersedes and makes void any prior
agreement between the parties and sets forth the entire agreement and
understanding of the parties hereto with respect to the matters
covered hereby, and may not otherwise be amended or modified except by
written agreement executed by the Company and the Executive. This
Agreement shall be governed by and construed in accordance with the
laws of the State of California.
This Agreement has been executed on the date specified in the first
paragraph.
XXXXXXX AIRCRAFT HOLDINGS, INC.
By:
--------------------------------
Authorized Signature
EXECUTIVE
--------------------------------
Xxxx Xxxxxx
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