AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.15
Execution Version
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (hereinafter referred to as the
“Agreement”) is made and entered into as of the 21st day of March, 2007 by and between Xxxxxx
X. Xxxx (hereinafter referred to as the “Employee”) and Atlas Air, Inc., a Delaware
corporation (hereinafter referred to as “Atlas” or the “Company”).
WHEREAS, the Employee has been employed by the Company as Senior Vice President and Chief
Marketing Officer pursuant to that Employment Agreement dated May 1,2003, as amended on January 24,
2004 and April 20, 2004 (the “Original Employment Agreement”); and
WHEREAS, the Employee and the Company wish to amend and restate the Original
Employment Agreement as of the date hereof, on the terms and subject to the conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other good and
valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties
hereto, intending to be legally bound hereby, covenant and agree as follows:
1. DEFINITIONS
1.1 “Employment Period” shall mean the period commencing on the date hereof and
extending until December 31, 2007, subject to earlier termination as set forth in Section 4.1
below.
1.2 “Confidential or Proprietary Information” as used herein shall refer to all
information relative to the plans, structure and practices, including information relating to its
customers, contracts and aircraft of Atlas or any affiliate or subsidiary thereof, except:
(a) information that is or becomes a matter of public knowledge through no
fault of the Employee; or
(b) information rightfully received by the Employee from a third party
without a duty of confidentiality; or
(c) information disclosed to the Employee with Atlas’ prior approval for
public dissemination.
2. OBLIGATIONS OF THE EMPLOYEE
Atlas and the Employee agree to the following rights, obligations and duties:
2.1 Obligations of the Employee. During the Employment Period, Atlas agrees to retain the
Employee as Senior Vice President and Special Advisor. The scope of the Employee’s
responsibilities shall be determined by the Board of Directors, the Chief Executive Officer, the
Chief Operating Officer and such other officers of Atlas as the Chief Executive Officer shall deem
appropriate. The Employee shall, except when prevented by illness or permanent disability or during
a period of vacation, devote sufficient Employee business time to ensure accomplishment of the
transition projects set forth in Exhibit A and attention to the good faith performance of
the other duties contemplated by this Agreement.
2.2 Principal Residence of the Employee. The Employee shall maintain his principal
residence in the Long Beach, California area unless otherwise agreed.
2.3 New Position Provisions. Upon execution of this Agreement, the parties’
respective rights and obligations under the Original Employment Agreement shall be superseded
by this Agreement. The Employee hereby resigns from his prior position as Senior Vice
President and Chief Marketing Officer of the Company and its affiliates as of the commencement
of the Employment Period.
3. COMPENSATION
During the Employment Period, Atlas will pay the Employee as follows:
3.1 Compensation. Atlas will pay the Employee at the rate of $350,720 per annum,
payable in semi-monthly installments.
3.2 Incentive Bonus Payments. The Employee has received his annual incentive
bonus for 2006, paid in accordance with the Company’s 2006 Annual Incentive Plan for Senior
Executives (the “2006 AIP”). The Employee will not be entitled to any bonus for 2007 whether
under the 2006 AIP or otherwise.
3.3 Benefits. During the Employment Period, the Employee and the Employee’s
dependents shall be entitled to participate in the Atlas health insurance plans (major
medical,
dental and vision), and Atlas will contribute to the Employee’s monthly premium as provided by
such plan. Atlas reserves the right to discontinue participation in any health insurance plan
at
any time with the understanding that Atlas will comply in full measure with all state and
federal
laws regarding the changes of insurance coverage by private employers and notification under
the Consolidated Omnibus Budget Reconciliation Act. The Employee also shall be entitled, to
the same extent and at a level commensurate with other employees of Atlas, to participate in
any
other benefit plans or arrangements of Atlas.
3.4 Restricted Shares and Options. During the Employment Period, all Company
restricted shares and stock options will continue to vest in accordance with their terms.
3.5 Fringe Benefits. The Employee will be entitled to a car allowance in the amount
of $700.00 per month.
4. TERMINATION OF THE EMPLOYMENT PERIOD
4.1 Termination. Employment hereunder shall be through the Employment Period;
provided, however, that the Company may immediately terminate the Employment Period with
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Cause (as defined below). “Cause” shall be defined as (i) a breach by the Employee of a material
term of this Agreement; (ii) any act of misconduct or dishonesty by the Employee; or, (ii) the
Employee’s failure to perform the transition projects set forth in Exhibit A, which may be amended
from time to time by written agreement of the parties. Provisions of this Agreement shall survive
any termination if so provided herein or if necessary or desirable to accomplish the purposes of
other surviving provisions, including without limitation the obligations of the Company under
Section 4.2 and the obligations of the Employee under Section 4.3
4.2 Rights Following Termination. Upon termination of the Employment Period by
the Company without Cause or expiration of the Employment Period, the Employee shall be
entitled to: (i) receive the Employee’s base salary and accrued benefits through December 31,
2007; (ii) receive, subject to the Employee’s execution of a separation agreement and general
release (a true and correct copy of which is attached hereto as Exhibit B), (the “Release”),
severance of $526,080 paid in a lump sum within ten (10) days of the Employee’s execution of
the Release (and provided that the Employee does not revoke the Release); (iii) subject to
“the
Employee’s execution of the Release and compliance with the terms of Section 4.3, continued
coverage and rights and benefits available under the Atlas health insurance plans as provided
in
Section 3.3 above for a period of twenty-four (24) months immediately following the date of
termination subject to the Employee paying the same portion for the premiums for such coverage
as he paid during the Employment Period; provided, however, that any such continued
coverage
shall cease in the event the Employee obtains comparable coverage in connection with
subsequent consulting or employment arrangements, and to the extent Atlas is unable to
continue
such coverage, Atlas shall provide the Employee with economically equivalent benefits
determined on an after-tax basis; (iv) Employee’s restricted shares and options that have
vested
or will vest pursuant to the terms and conditions of their related agreements; and (v) receive
any
retired employee benefits available to retired Company employees for which he is eligible
pursuant to the terms of any applicable policies or plan documents, as amended from time to
time. Upon termination of the Employment Period for any other reason (including, without
limitation, by the Company with Cause or by the Employee for any reason), the Employee shall
be entitled only to base salary and accrued benefits through the date the Employee’s
employment
terminates.
4.3 Restrictive Covenants.
(a) The Employee covenants and agrees that the Employee will not, at any
time, reveal, divulge or make known to any third party any confidential or proprietary
records,
data, trade secrets, pricing policies, strategy, rate structure, personnel policy, management
methods, financial reports, methods or practice of obtaining or doing business, or any other
Confidential or Proprietary Information of Atlas or any of its subsidiaries or affiliates
(collectively the “Atlas Companies” and each, an “Atlas Company”) which is not in the
public
domain.
(b) Acknowledging his duty of loyalty to the Atlas Companies, the Employee
agrees that, while he is employed by the Company, he will not, directly or indirectly, whether
as
owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with
any of the Atlas Companies anywhere in the world or undertake any planning for any business
competitive with any of the Atlas Companies. Specifically, but without limiting the generality
of
the foregoing, the Employee agrees that, during his employment with the Company, he will not
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provide advice, services or other assistance of any kind, whether with or without compensation, to
any person or entity which competes, or is planning to compete., with any of the Atlas Companies.
The Employee understands, however, that his passive ownership of one percent (1 %) or less of the
voting stock of any publicly traded company will not be a breach of his obligations hereunder.
After his employment ends, the Employee may compete with any of the Atlas Companies, but should he
choose to so compete within the twelve (12) months immediately following termination of the
Employment Period without first obtaining the express written consent of the Company, which consent
shall not be unreasonably withheld, the Employee agrees that he will not be entitled to the payment
and benefits provided in Sections 4.2(ii) and (iii) above, and if such payment and benefits have
already been provided to the Employee, he shall return to the Company the payment under Section
4.2(ii) within five (5) days of written demand by the Company, or in the event of a dispute as to
whether the Employee has breached any of his obligations under this Section 4.3, Employee shall
return to the Company any payments received within five (5) days after determination of a breach
and in accordance with Sections 5.1, 5.2, 5.3 or 5.5, as appropriate.
(c) The Employee acknowledges that his access to Confidential or Proprietary
Information and to the Atlas Companies’ customers and his development of goodwill on behalf
of the Atlas Companies with their customers during his employment would give him an unfair
competitive advantage were he to leave employment and begin competing with the Atlas
Companies for their existing customers and that he therefore is being granted access to
Confidential or Proprietary Information and the customers of the Atlas Companies in reliance
on
his agreement hereunder. Therefore, the Employee covenants and agrees that, during the
Employment Period and during the twelve-month period immediately following the termination
of the Employment Period, the Employee will not engage in any of the following activities
directly or indirectly, for any reason, whether for the Employee’s own account or for the
account
of any other person, firm, corporation or other organization;
| (i) | solicit, employ or otherwise interfere with any of the Atlas Companies’ contracts or relationships with any officer, director, employee, independent contractor or with any individual who has been employed or associated with the Atlas Companies within the six (6) months prior to the Employee’s termination of his employment relationship with the Company; or | ||
| (ii) | solicit or encourage any customer of any of the Atlas Companies to terminate or diminish its relationship with any of the Atlas Companies or seek to persuade any such customer to conduct with, any other person or entity any business or activity which such customer conducts or could conduct with any of the Atlas Companies; provided, however, that these restrictions shall apply only with respect to those persons or entities who are customers of any of the Atlas Companies within the twelve (12) months prior to the Employee’s termination of his employment relationship with the Company. |
(d) In the event the Employee breaches any of his obligations under this
Section 4.3, he shall within five (5) days return to the Company any payments he received
under
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Section 4.2(ii) and any benefits under Section, 4.2(iii) shall immediately cease. In the event of a
dispute as to whether the Employee has breached any of his obligations under this Section 4.3,
Employee shall return to the Company any payments received within five (5) days after determination
of a breach and in accordance with Sections 5.1, 5.2, 5.3 or 5.5, as appropriate.
4.4
Obligation to Cooperate. To the extent Employee is reasonably available to provide
such cooperation to Company, during the twenty-four (24) month period immediately following the
termination of the Employee’s employment, the Employee shall cooperate with the Company with
respect to all matters arising during or related to his employment, including but not limited to
all matters in connection with any governmental investigation, litigation or regulatory or other
proceeding which may have arisen or which may arise following the signing of this Agreement. The
Company will reimburse the Employee out-of-pocket expenses incurred in complying with Company
requests hereunder, provided such expenses are authorized by the
Company in advance. In the event
that any single Company request hereunder requires a commitment from
the Employee of more than five
(5) hours, the Company and the Employee shall mutually agree on reasonable compensation for the
Employee’s services on such matter.
5. DISPUTE RESOLUTION AND CHOICE OF LAW
5.1. Negotiation. If a dispute between the parties arises under this Agreement, the
parties shall negotiate in good faith in an attempt to resolve their differences. The
obligation of
the parties to negotiate in good faith shall commence immediately, and shall continue for a
period of at least thirty (30) days (“Negotiation”).
If Negotiation fails to resolve a dispute between the parties within the first thirty (30)
days, either party may proceed to demand mediation (“Mediation”). Upon agreement of both parties,
arbitration may be initiated immediately, in lieu of Mediation.
5.2. Mediation. If a dispute between the parties arises under this Agreement and has
not been resolved under the Negotiation procedures described herein, either party may require,
by written notice to the other party, that Negotiation be facilitated by a single mediator, to
be
elected by the parties (the “Mediator”).
The parties shall select the Mediator within ten (10) days after receipt of notice. If the
parties are unable to agree on the Mediator, the Mediator shall be selected by Atlas, but the
selected Mediator shall be independent of Atlas and its affiliates.
The fees of the Mediator shall
be paid by the Company.
With the assistance of the Mediator, the parties shall continue Negotiation in good faith for
a period not to exceed thirty (30) days. If the parties are unable to reach agreement during this
period, the Mediator shall be discharged and the parties’ obligations under this Mediation section
shall be deemed satisfied.
5.3. Arbitration. Subject to the duty to negotiate and mediate set forth above, all
disputes, claims, or causes of action arising out of or relating to this Agreement or the
validity,
interpretation, breach, violation, or termination thereof not resolved by Mediation, shall be
finally and solely determined and settled by arbitration, to be conducted in the State of New
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York, USA, in accordance with the Commercial Arbitration Rules of the American Arbitration
Association (“AAA”) in effect at the date of arbitration (“Arbitration”).
Any Arbitration commenced pursuant to this Agreement shall be conducted by a single neutral
arbitrator, who shall have a minimum of three (3) years of commercial experience (the
“Arbitrator”). The parties shall meet within ten (10) days of failure to resolve by Mediation to
attempt to agree on an Arbitrator. Absent agreement at this meeting, the Arbitrator shall be
selected by AAA. Such Arbitrator shall be free of any conflicts with Atlas and shall hold a hearing
within thirty (30) days of the notice to the Employee.
If the terms and conditions of this Agreement are inconsistent with the Commercial
Arbitration Rules of the AAA, the terms and conditions of this Agreement shall control.
The parties hereby consent to any process, notice, or other application to said courts and any
document in connection with Arbitration may be served by (i) certified mail, return receipt
requested; (ii) by personal service; or (iii) in such other manner as may be permissible under the
rules of the applicable court or Arbitration tribunal; provided, however, a reasonable time
for appearance is allowed. The parties further agree that Arbitration proceedings must be
instituted within one (1) year after the occurrence of any dispute, and failure to initiate
Arbitration proceedings within such time period shall constitute an absolute bar to the institution
of any proceeding and a waiver of all claims.
The parties shall equally divide all costs and expenses incurred in such arbitration
proceeding, provided, however, if the arbitrator rules in favor of the Employee on all
or substantially all of his claims, the Company shall reimburse the Employee his reasonable
attorney fees and costs associated with the arbitration proceedings.
The Judgment of the Arbitrator shall be final and either party may submit such decision to
courts for enforcement thereof.
The parties agree that this Section 5 shall be specifically enforceable.
5.4. Choice of Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without reference to principles of conflict of laws.
5.5 Injunctive Relief. Notwithstanding the foregoing, Sections 5.1, 5.2 and 5.3 shall not
preclude the Company from attempting to pursue a court action to enforce, determine the
enforceability of, or seek injunctive relief due to a breach or threatened breach of the provisions
of Section 4.3 of this Agreement.
6. SEVERABILITY AND ENFORCEABILITY
It is expressly acknowledged and agreed that the covenants and provisions hereof are
separable; that the enforceability of one covenant or provision shall in no event affect the full
enforceability of any other covenant or provision herein. Further, it is agreed that, in the event
any covenant or provision of this Agreement is found by any court of competent jurisdiction or
Arbitrator to be unenforceable, illegal or invalid, such invalidity, illegality or unenforceability
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shall not affect the validity or enforceability of any other covenant or provision of this
Agreement. In the event a court of competent jurisdiction or an Arbitrator would otherwise hold any
part hereof unenforceable by reason of its geographic or business scope or duration, said part
shall be construed as if its geographic or business scope or duration had been more narrowly
drafted so as not to be invalid or unenforceable.
7. NOTICE
For the purpose of this Agreement, notices and all other communications provided for in this
Agreement shall be in writing and shall be deemed to have been duly given if delivered personally,
if delivered by overnight courier service, if sent by facsimile transmission or if mailed by United
States registered mail, return receipt requested, postage prepaid, addressed to the respective
addresses or sent via facsimile to the respective facsimile numbers, as the case may be, as set
forth below, or to such other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective only upon receipt;
provided, however, that: (i) notices sent by personal delivery or overnight courier shall
be deemed given when delivered; (ii) notices sent by facsimile transmission shall be deemed given
upon the sender’s receipt of confirmation of complete transmission; and (iii) notices sent by
United States registered mail shall be deemed given, two days after the date of deposit in the
United States mail.
If to the Company:
Atlas Air, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: General Counsel
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: General Counsel
Facsimile: 0 000 000-0000
If to Employee:
Xxxxxx X. Xxxx
The address on file with the records of the Company
8. MISCELLANEOUS
8.1. No Mitigation. The Employee shall have no duty to mitigate..
8.2. Withholding. The Company shall be entitled to withhold from the payments and
benefits described herein all income taxes and other amounts required to be withheld by
applicable law.
8.3.
Pro-Ration. In the event the Employment Period is terminated in the middle of
any calendar month, the amount due for such month shall be pro-rated on a daily basis,
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8.4. No Waiver Except in Writing. The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be considered a waiver of
such party’s rights or deprive such party of the right thereafter to insist upon strict
adherence to
that term or any other term of this Agreement. No waiver or modification of this Agreement or
any of the terms and conditions set forth herein shall be effective unless submitted to a
writing
duly executed by the parties.
8.5. Drafting. Both parties have participated in the preparation of this Agreement, and
no rules of construction or interpretation based upon which party drafted any portion of the
Agreement shall be applicable or invoked.
8.6. No Representations. The parties agree and acknowledge that they have not relied
upon any representation, whether written or oral, of the other party in connection with
entering
into this Agreement.
8.7. Successors and Assigns. This Agreement shall be binding on Atlas and any
successor thereto, whether by reason of merger, consolidation or otherwise. The duties
and
obligations of the Employee may not be assigned, by the Employee.
8.8. Confidentiality of Terms. Atlas and the Employee agree that the terms and
conditions of this Agreement are confidential and that they will not disclose the terms of
this
Agreement to any third parties, other than the Employee’s spouse, their attorneys, auditors,
accountants or as required by law or as may be necessary to enforce this Agreement.
8.9. Full Understanding. The Employee declares and represents that the Employee has
carefully read and fully understands the terms of this Agreement, has had the opportunity to
obtain advice and assistance of counsel with respect thereto, and knowingly and of the
Employee’s own free will, without any duress, being fully informed and after due deliberation,
voluntarily accepts the terms of this Agreement and represents that the execution, delivery
and
performance of this Agreement does not violate any agreement to which the Employee is subject.
8.10. Entire Agreement. This Agreement sets forth the entire agreement and
understanding between the parties with respect to the subject matter hereof and supersedes all
prior agreements, arrangements, and understandings between the parties with respect to the
subject matter hereof, excluding only any option of restricted share agreements or other
agreements related to a grant of equity or an option to purchase equity in the Company.
8.11. Counterparts. This Agreement may be executed in any number of separate
counterparts, all of which taken together shall be deemed to constitute one and the same
instrument.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Employment
Agreement on the date and year first above written.
| XXXXXX X. XXXX |
||||
| /s/ Xxxxxx X. Xxxx | ||||
| ATLAS AIR, INC. |
||||
| By: | /s/ Willliam X. Xxxxx | |||
| Name: | WILLLIAM X. XXXXX | |||
| Title: | PRESIDENT & CEO | |||
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