EXHIBIT 10.2
September 5, 1997
Xxxx X. Xxxxxx
Senior Vice President-Finance and
Chief Financial Officer
US Airways, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Xxxx:
This letter, when countersigned by you, will reflect
the terms of the agreement between US Airways, Inc. ("US
Airways" or the "Company") and you concerning the severance
of your employment. US Airways has not yet identified your
successor, and, therefore, we have requested and you have
agreed to continue in your position while we identify a
successor and to provide assistance and advice to ensure a
smooth transition of your responsibilities to your
successor. In consideration for your services during this
period, for your past service to the Company and the mutual
promises herein contained, US Airways agrees to the
following:
1. You will continue in your current position
as Senior Vice President-Finance and Chief Financial
Officer of US Airways, Inc. and US Airways Group, Inc.
until such time as your successor is elected and a
reasonable transition period has passed. US Airways
will determine in its sole discretion when the
transition period has been completed. Notwithstanding
the foregoing, in the event that no successor is named,
or under any circumstances, the last day of your active
employment will be January 15, 1998. Upon the first to
occur of the completion of the transition period or
January 15, 1998, you will resign your positions with
US Airways, Inc., US Airways Group, Inc., and any other
positions, including board memberships, at any
subsidiary corporations.
2. Subject to paragraph 5 below addressing
incentive compensation, during the period from today's
date through January 15, 1998, you will continue to
receive your current base salary and all other
compensation and benefits applicable to your current
position as a senior officer, to the extent such
benefits are continued for all other senior officers.
In the event that a successor is named and a transition
period is completed prior to January 15, 1998, you will
continue to receive your base salary and all other
compensation and benefits as if you remained an active
employee through January 15, 1998, irrespective of the
resignation of your employment.
Xxxx X. Xxxxxx
September 5, 1997
Page Two
3. Within 15 days of your severance, US
Airways will pay to you in one lump sum, a severance
payment based upon one year's base salary (i.e.,
$295,000) representative of the period of time from the
completion of the transition period through the
anniversary of such date; provided, however, that in
the event that the transition period is completed prior
to January 15, 1998, this severance payment will be
decreased for the period of salary continuation from
the end of the transition period through January 15,
1998.
4. US Airways agrees to provide you with
continued service credit under the terms of the non-
qualified supplemental executive retirement agreement
dated August 8, 1995 between you and the Company
(hereinafter the "SERP Agreement") through the earlier
to occur of one year from the completion of the
transition period or January 15, 1999. The parties
acknowledge that the additional service credit will be
credited under the formula in the SERP Agreement which
provides for two years of "deemed" credited service for
each year of actual service. Additionally, in the
event that you elect immediate commencement of pension
benefits upon your severance, the additional service
credit will be included in the calculation regardless
of the benefit commencement.
5. You agree that you will not be entitled to
any incentive award under the US Airways Group, Inc.
Incentive Compensation Plan for the 1997 or the 1998
fiscal year.
6. As a result of the separation of your
employment with US Airways, (a) the remaining
7,000 shares of restricted stock granted to you
on November 28, 1995, with a three-year vesting
schedule, will not vest under the Restricted
Stock Agreement as currently drafted, and (b)
the option to purchase 35,000 shares of stock
at an option price of $25.375, with a five-year
vesting schedule, will not vest under the terms
of the Stock Option Agreement as currently
drafted, if your severance date is before
November 28, 1997 or March 25, 1998,
respectively. US Airways agrees that the 3,000
shares of restricted stock currently scheduled
to vest on November 28, 1997 will vest on that
date irrespective of the status of your
employment. The remaining 4,000 shares of
restricted stock scheduled to vest on November
28, 1998 will be forfeited on your severance
date. Additionally, the option to purchase
7,000 shares which is currently scheduled to
vest on March 25, 1998 will vest on that date
irrespective of the status of your employment
on that date. You will have until September
25, 1998 to exercise those vested options. The
option to purchase the remaining 28,000 shares
of stock will be forfeited on your severance
date. The applicable restricted stock and
stock option agreements will be amended
accordingly.
Xxxx X. Xxxxxx
September 5, 1997
Page Three
7. In the event that you elect to commence
your retirement benefits immediately upon your
severance, i.e., effective February 1, 1998, you will
be eligible for all retiree benefits provided to
employees and senior officers of the Company, as they
may be amended from time to time, including, but not
limited to health plan coverage, on-line space positive
travel privileges, US Airways Club privileges and
split-dollar life insurance continuation.
8. The parties agree that the severance of
your employment is by mutual agreement pursuant to
paragraph 5(a) of the Employment Agreement between you
and the Company dated January 27, 1993 and you
expressly waive your right to any of the rights,
compensation, benefits or other Company obligations
under said Employment Agreement effective with your
signing of this letter. You agree that this document
contains the entire understanding of the parties
related to the severance of your employment and the
rights and obligations of the parties upon the
severance of your employment.
9. You agree to hold in a fiduciary capacity
for the benefit of US Airways and will not disclose
without the prior written consent of US Airways, all
confidential and proprietary information, knowledge or
data relating to US Airways, its parent, subsidiary or
affiliated companies, which was obtained by you during
your employment with US Airways unless such
information, knowledge or data is known to the general
public (other than by acts by you). You further agree
not to disclose or make public, orally, in writing, or
otherwise, any disparaging statements, or any
information which would cause public discredit, about
US Airways, its parent, subsidiary or affiliated
companies, or their respective directors, officers or
employees. In the event that you are subpoenaed or
otherwise compelled by court order to provide
information which would violate this non-
disclosure/non-disparagement provision, you will notify
US Airways before responding to any such request for
testimony or information to afford US Airways an
opportunity to assert any objection it may have. In
the event that US Airways determines that you have
breached this non-disclosure/non-disparagement
provision you will forfeit eligibility for all of the
compensation and benefits provided for in this
agreement. Any compensation or benefits paid to you
prior to such must be repaid to US Airways within 15
days of your receipt of written notification of such
breach from US Airways. US Airways reserves the right
to pursue any other legal or equitable remedies
available to it to enforce this non-disclosure/non-
disparagement provision.
Xxxx X. Xxxxxx
September 5, 1997
Page Four
10. You irrevocably and unconditionally
release and discharge US Airways, it subsidiaries,
parent, affiliates, predecessors, successors and
assigns, and their respective principals, directors,
officers, employees, and agents from all legal,
equitable, or administrative claims, known and unknown,
that you may have against any or all of them arising on
or before the date you execute this agreement. This
release specifically includes but is not limited to any
discrimination claims arising under the Civil Rights
Act of 1964, as amended, the Americans with
Disabilities Act, the Civil Rights Act of 1991, the Age
Discrimination in Employment Act, the Employee
Retirement Income Security Act, the Older Workers
Benefit Protection Act, and all other claims arising
under federal, state or local statutes, common law or
ordinances. This release also includes but is not
limited to a release of any claim for tortious conduct,
breach of contract, breach of covenants, wrongful
discharge or for attorneys' fees and costs.
11. The parties agree that any and all claims
concerning the application, interpretation, and
enforcement of this agreement shall be filed and
litigated in the appropriate trial court in the
Commonwealth of Virginia. The parties agree that they
are expressly waiving the right to file and litigate
any action, in law or in equity, concerning this
agreement in any other forum.
Your signature below indicates your agreement to and
intention to be bound by the terms of this agreement. Your
signature below also indicates that you have read this
document, understand all of its provisions, have had the
opportunity to seek the advice of counsel, and you have been
given at least 21 days to review the document. If you sign
this agreement prior to the end of said 21-day period, you
acknowledge that you have done so voluntarily. You have
seven days after signature to revoke this agreement. Any
such revocation must be delivered in writing to US Airways,
to the attention of Xxxx X. Xxxx, before the end of the
seventh day.
Pursuant to the authorization of its Board of
Directors, US Airways has entered into this agreement by
signature of its officer below.
EXECUTIVE US AIRWAYS, INC.
/s/ Xxxx X. Xxxxxx /s/ Xxxx X. Xxxx XXX
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Xxxx X. Xxxxxx Xxxx X. Xxxx III
Executive Vice President-Human
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