November 9, 2008
Exhibit 10.1
November 9, 2008
VIA FACSIMILE TO (000) 000-0000
& DHL EXPRESS
DHL Network Operations (USA), Inc.
0000 Xxxxx Xxxx Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxx – EVP, General Counsel & Secretary
| Re: | Third Amendment to the Hub and Line-Haul Services Agreement, by and between DHL Express (USA), Inc., as successor in interest to Airborne, Inc. (“Groundco”) and ABX Air, Inc. (“Airco”), dated August 15, 2003, as previously amended on April 27, 2004 and August 8, 2005 (the “Hub Services Agreement”). |
Dear Xxx:
This letter is intended to confirm the agreement between Groundco and Airco to amend the Hub Services Agreement in order to accommodate the requirements of each other.
Unless otherwise defined herein, all capitalized terms used herein shall have the meanings ascribed thereto in the Hub Services Agreement.
The Hub Services Agreement is hereby amended, modified and/or confirmed as follows:
(a) The Base Markup, the quarterly cost component and the annual cost and service components of the Incremental Markup to be paid to Airco in exchange for the services provided by Airco to Groundco under this Agreement during the fourth quarter of 2008 shall total $4,490,609, consisting of the following:
| $ | 1,410,873 | Base Markup for fourth quarter of 2008 | |
| $ | 150,000 | Quarterly cost component of Incremental Markup for fourth quarter 2008 | |
| $ | 900,000 | Annual cost component of Incremental Markup for 2008 | |
| $ | 2,029,736 | Annual service component of Incremental Markup for 2008 |
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November 9, 2008
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Groundco will pay the Base Markup on a weekly basis in accordance with the terms of the Hub Services Agreement and the aforementioned Incremental Markup amounts no later than February 15, 2009.
Further, the Base Markup, quarterly cost component and twenty-five percent (25%) of the annual cost and service components of the Incremental Markup to be paid to Airco in exchange for the services provided by Airco to Groundco under this Agreement during the first quarter of 2009 shall total $1,994,434, consisting of the following:
| $ | 1,112,000 | Base Markup for first quarter of 2009 | |
| $ | 150,000 | Quarterly cost component of Incremental Markup for first quarter of 2009 | |
| $ | 225,000 | 25% of annual cost component of Incremental Markup for 2009 | |
| $ | 507,434 | 25% of annual service component of Incremental Markup for 2009 |
(b) Groundco will pay the Compensation for the first quarter of 2009 weekly, in advance, by wire transfer to Airco on Monday of each week (or, if such day is not a Business Day, on the immediately succeeding Business Day), consisting of the Cost Recovery Amount for the forthcoming week plus the applicable Base Markup. Both the quarterly cost component and twenty-five percent (25%) of the annual cost and service components of the Incremental Markup will be paid by DHL no later than April 15, 2009, in accordance with the terms of the Hub Services Agreement.
(c) Groundco and Airco will each make commercially reasonable efforts to agree upon alternative compensation arrangements under the Agreement for subsequent quarters, at least sixty (60) days prior to the first day of each quarter.
(d) During any quarter for which Groundco and Airco have agreed upon alternative compensation arrangements, the 60-day minimum notice requirement with respect to making changes in the scope of services that is contained in the second sentence of Section 3.4 shall not be applicable to the termination of Services. Instead, within fifteen (15) calendar days of receipt of notice from Groundco of the termination of services, ABX shall: (i) provide fourteen (14) days prior written notice of termination of employment to those of its employees that will be impacted by such termination of services, and (ii) make commercially reasonable efforts to promptly reduce or eliminate its costs associated with such services. Airco will continue to pay, and Groundco will continue to reimburse Airco for, wages and benefits to its employees that are impacted by such termination of services for a period of sixty (60) days with respect to those employees that are stationed in Wilmington, Ohio, or at a regional hub that has been issued a WARN notice, and for any statutory notice periods under the WARN Act with respect to those employees that are stationed at other locations. Airco will ensure that the
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November 9, 2008
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fourteen (14) day notice period provided for hereunder and any sixty (60) day WARN notice period shall run concurrently (i.e. any applicable WARN notice period will commence upon Airco’s giving fourteen (14) days’ notice of termination, and Groundco’s reimbursement obligations with respect to wages and benefits will be during the concurrent, and not cumulative periods). In addition, Airco will ensure that any severance periods provided for under its employee severance plans likewise run concurrently with any applicable WARN notice period and the fourteen (14) day notice period hereunder.
Except and amended or modified by this letter, the terms and conditions of the Hub Services Agreement shall remain in full force and effect.
Please acknowledge Groundco’s acceptance of the foregoing by having an authorized representative of DHL Express (USA), Inc. sign and date both counterparts of this letter of amendment in the space provided below and returning one counterpart to me for my records.
| Sincerely, |
| /s/ W. Xxxxxx Xxxxx ABX Air, Inc. |
| W. Xxxxxx Xxxxx |
| Vice President |
| General Counsel & Secretary |
| ACCEPTED AND AGREED: | ||
| DHL Express (USA), Inc. | ||
| By: |
/s/ Xxxx Xxxx | |
| Its: |
EVP, & General Counsel & Secretary | |
| Date: |
11-10-08 | |
