J. XXXXXXX XXXXXX
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and
entered into as of the 30th day of September, 1997, by and among
MOUNTAIN AIRCRAFT SERVICES, LLC, a North Carolina limited
liability company ("Employer"); and J. XXXXXXX XXXXXX , an
individual having an address at 0000 Xxxxxxxx Xxxxx, Xxxxxxx-
Xxxxx, Xxxxx Xxxxxxxx 00000 ("Employee").
Background Statement
Employee is the current President and Chief Operating
Officer of Employer along with being the Chief Executive Officer
of Global Ground Support, LLC ("Global") and a Vice President of
Air Transportation Holding Company, Inc. ("AirT"). Employee has
been instrumental in successfully developing, expanding and
increasing the business and earnings of Employer, AirT and
Global. Employer desires to ensure that the services of Employee
will continue to be available to it on a mutually satisfactory
basis. In the course of his employment with Employer, Employee
will have access to trade secrets and proprietary information of
Employer. Accordingly, Employee has and will continue to acquire
the knowledge and ability to compete with Employer. Employer has
offered Employee an employment agreement on the terms and
pursuant to the conditions hereof, including the stability and
security provided to Employee by the arrangement provided for
herein. The parties agree that the execution and delivery of
this Agreement is a condition precedent to the benefits extended
to Employee hereunder. Employee agrees that the benefits
provided for herein are adequate and sufficient consideration for
the covenants made by Employee hereunder, including, without
limitation, the covenant not to compete.
NOW, THEREFORE, for valuable consideration, the receipt of
which is hereby acknowledged, the mutual duties and obligations
set forth herein, and intending to be legally bound, the parties
hereto agree as follows:
1. Employment. Employer hereby agrees to employ Employee
and Employee hereby agrees to serve Employer upon the terms and
conditions set forth in this Agreement in the capacity set forth
on Exhibit A attached hereto, with the duties and
responsibilities of such positions to be determined from time to
time by the President and/or Chief Executive Officer of AirT.
2. Term.
(a) Statement of Term. The term of this Agreement shall
begin on October 1, 1997, and end on September 30, 1999, or on
such later date to which the term of this Agreement may be
extended pursuant to the provisions of this Paragraph 2.
(b) Automatic Extension. Subject to subparagraph (c) of
this Paragraph 2, the term of this Agreement shall be extended
automatically for one year effective on the 1st day of December,
1997, and on the 1st day of each succeeding December.
(c) Termination of Automatic Extensions. Employee or
Employer, by written notice delivered to the other, may at any
time elect to terminate the automatic extension provisions of
subparagraph (b) of this Paragraph 2. Such election shall apply
only to extensions that would otherwise become effective after
delivery of such notice and shall not apply to extensions that
have theretofore become effective.
3. Compensation, Incentives and Employee Benefits.
(a) Base Salary. Employer shall pay to the Employee for
his performance of services hereunder a base salary ("Base
Salary") at the rate of not less than One Hundred Fifteen
Thousand and No/100 ($115,000.00) per year for the period of this
Agreement. The Employee's Base Salary rate shall be reviewed by
Employer annually. From and after the effective date of any such
change the increased rate shall become the Base Salary rate
applicable thereafter. Base Salary shall be paid in bi-weekly
installments and shall be prorated for any partial months of
employment.
(b) Incentive Compensation. Employer shall pay to Employee
incentive compensation ("Incentive Compensation") equal to 2
percent (2%) of Employer's and Global's yearly earnings before
income taxes or extraordinary items. Amounts payable under this
subparagraph, if any, shall be paid within fifteen (15) days
after AirT files its Annual Report on Form 10-K with the
Securities and Exchange Commission. Amounts otherwise payable
hereunder shall be prorated for a partial year's employment in
the event Employee's employment is terminated by Employer during
the course of its fiscal year.
(c) Employee Benefit Plans. In addition to the Base Salary
and Incentive Compensation provided for above, Employer shall
provide to the Employee the opportunity to participate in all
life insurance, medical, dental, optical, disability, and other
employee benefit plans (collectively, "Employee Benefit Plans")
sponsored from time to time by Employer and covering its
employees generally or a particular group of its employees of
which the Employee is a member (including participation by the
Employee's dependents to the extent they are eligible under the
terms of such plans), subject to the terms and conditions of such
benefit plans.
(d) Reimbursement of Expenses. Employer shall pay or
reimburse Employee for all reasonable travel and other expenses
incurred by him in performing his obligations under this
Agreement. Such expenses shall be appropriately submitted and
approved in accordance with the policies approved by Employer.
(e) Vacation. Employee shall be entitled to four weeks
paid annual vacation in accordance with the normal policies of
Employer.
(f) Automobile Allowance. Employee shall be entitled to an
automobile allowance of $400.00 per month.
4. Duties. During the term hereof, Employee shall devote
all of his business time, attention, skills and efforts to the
business of Employer and the faithful performance of his duties
hereunder; provided, however, that (i) nothing contained herein
shall prevent Employee from making outside investments consistent
with the provisions contained herein and (ii) with the approval
of the Board of Directors of AirT, from time to time Employee may
serve, or continue to serve, on the boards of directors of, and
hold any other offices or positions in, companies or
organizations which, in the AirT Board of Directors' judgment,
will not present any conflict of interest with Employer, or
materially affect the performance of Employee's duties pursuant
to this Agreement.
5. Termination.
(a) Termination By Employer Without Cause. The parties
recognize (i) that Employer has the duty to use its judgment in
the best interests of Employer in determining whether to
terminate Employee's employment under this Agreement even though
there may be no legal cause therefor, and (ii) that any action or
inaction of Employer pursuant to clause (i) shall not prejudice
the rights of Employee under this Agreement. Accordingly, the
parties agree that, subject to all other provisions of this
Paragraph 6, Employer shall have the right at any time during the
term of this Agreement to terminate this Agreement without cause.
Termination of this Agreement shall be deemed to occur on the
date Employee is notified thereof.
(b) Termination by Employee. Employee may terminate his
employment with Employer, for any reason or without reason,
during the term hereof. Such termination must be accompanied by
the delivery of at least 30 days' written notice delivered to
Employer.
(c) Termination Payments. If Employer terminates
Employee's employment hereunder pursuant to Paragraph 5(a) hereof
for any reason other than for "Cause", as defined herein, then
immediately upon the effectiveness of the termination Employer
shall make a lump sum cash payment to Employee in an amount equal
to one (1) year of Base Salary.
(d) Disability. If the Employee is unable to perform his
duties hereunder for a period of three (3) consecutive months due
to disability (as defined by the primary disability insurance
carrier then providing such insurance coverage for the Employer's
executive officers), this Agreement may be terminated at
Employer's discretion by giving to the Employee written notice
specifying a termination date subsequent thereto and also
subsequent to the end of said three (3) month period.
(e) No Mitigation. Employee shall have no obligation to
seek other employment in the event of termination of his
employment and no compensation or other benefits received by
Employee from any other employment shall reduce or limit
Employer's obligation to make payment under this entire Paragraph
6.
(f) Definitions. Termination for "Cause" shall mean
termination because of conviction by a court of competent
jurisdiction of theft from Employer, conviction by a court of
competent jurisdiction of embezzlement of the Employer's funds,
conviction by a court of competent jurisdiction of falsification
of the Employer's records, conviction by a court of competent
jurisdiction of fraud committed against Employer, conviction by a
court of competent jurisdiction of a felonious criminal act
involving Employer or while engaged in conduct of Employer's
business, incompetence due to the use of or reporting to work
under the influence of alcohol, narcotics, other unlawful drugs
or controlled substances, legal incapacity, insanity, act or acts
involving dishonesty or misconduct which have or may reasonably
be expected to have a material adverse effect on the business or
reputation of Employer, breach of fiduciary duty to Employer,
willful and substantial failure to perform stated duties or
lawful directives of Employer, or material breach of any
provision of this Agreement.
6. Confidential Information. Employee shall not, at any
time during or following his employment by Employer regardless of
the reason for such termination of employment, furnish, divulge,
communicate, use to the detriment of Employer or for the benefit
of any business, firm, person, partnership, trust or corporation,
or otherwise, any of Employer's confidential information, data,
trade secrets, sales methods, names of customers, advertising
methods, financial affairs or methods of procurement, or take
with him any document or paper relating to the foregoing, it
being acknowledged that Employee received or obtained all of the
above in confidence and as a fiduciary of Employer.
7. Non-Competition. Employee agrees that, during
Employee's employment with Employer and for a period of one (1)
year thereafter, whether Employee leaves voluntarily or
involuntarily:
(a) Employee will not directly or indirectly,
individually or as a partner, employee, stockholder,
consultant, agent, officer, director, advisor or in any
other capacity, solicit any of the customers of Employer for
the purpose of selling any service or product similar to
those provided by Employer, or in any manner attempt to
induce any of Employer's customers or suppliers to withdraw,
reduce or divert any of their business from Employer or
otherwise interfere or attempt to interfere with any
business relationship between Employer and its customers or
suppliers. For the purposes of this Paragraph 7(a),
customers shall mean (i) any client, account or customer of
the Employer that has transacted any business with or been
contacted by Employer within the twelve months preceding the
date hereof, and (ii) any other client, account or customer
of Employer that has done business with Employer within two
years of the date of such separation or termination;
(b) Employee will not in any manner induce or attempt
to induce any of Employer's employees to leave the
employment of Employer to become associated with any
business operation engaged in the air cargo or air freight
business;
(c) Employee will not directly or indirectly, either
as principal, agent, manager, employee, owner (if the
percentage of ownership exceeds one percent (1%) of the net
worth of the business), partner (general or limited),
director, officer, consultant or in any other capacity,
participate in any business operation engaged in the
aircraft deicer, air cargo or air freight business;
8. Limitations on Scope. Because of the present and
contemplated future operations of Employer in the geographic
areas hereinafter set forth, it is further understood and agreed
by the parties hereto that the restriction set forth in Paragraph
7(c) shall apply to a business engaged in the aircraft deicer,
air cargo, air freight, aircraft maintenance or aircraft parts
brokering business or businesses in the following geographic
areas:
(i) The State of Kansas;
(ii) The State of Illinois;
(iii) The State of North Carolina;
(iv) The State of Florida;
(v) Any State contiguous with the State of
Kansas;
(vi) Any State contiguous with the State of
Illinois;
(vii) Any State contiguous with the State of
North Carolina;
(viii) Any State contiguous with the State of Florida;
(ix) Any State east of the Mississippi River;
(x) Any State west of the Mississippi River;
(xi) Any State of the United States of America;
and
(xii) Any location in the World.
The parties intend the above geographical areas to be
completely severable and independent, and any invalidity or
unenforceability of this Agreement with respect to any one area
shall not render this Agreement unenforceable as applied to any
one or more of the other areas.
9. Severability. If any provision contained in this
Agreement shall for any reason be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this
Agreement but this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been
contained herein. The parties agree that in the event a court
should determine that this Agreement or any of the covenants
contained herein is unreasonable, void or invalid, for any reason
whatsoever, then in such event, the parties hereto agree that the
duration, geographical or other limitation imposed herein should
be as the court, or jury, if applicable, should determine to be
fair and reasonable, it being the intent of each of the parties
hereto to be subject to an agreement that protects the legitimate
competitive interests of Employer and does not unreasonably
curtail the rights of the Employee.
10. Employee's Representation. Employee represents that
his experience and capabilities are such that the provisions of
Paragraphs 7 and 8 will not prevent him from earning a
livelihood.
11. Employer's Right to Obtain an Injunction. Employee
acknowledges that Employer will have no adequate means of
protecting its rights under Paragraphs 7 and 8 of this Agreement
other than securing an injunction. Accordingly, Employee agrees
that Employer is entitled to enforce this Agreement by obtaining
a preliminary and permanent injunction and any other appropriate
equitable relief in a court of competent jurisdiction. Employee
acknowledges that the recovery of damages by Employer will not be
an adequate means to redress a breach of this Agreement. Nothing
contained in this Paragraph, however, shall prohibit Employer
from pursuing any remedies in addition to injunctive relief,
including recovery of damages.
12. General Provisions.
(a) Entire Agreement. This Agreement contains the entire
understanding between the parties hereto relating to the
employment of Employee by Employer and supersedes any and all
prior employment, compensation or retirement agreements between
Employer or any predecessors of Employer or any of its
subsidiaries and Employee.
(b) Nonassignability. Neither this Agreement nor any right
or interest hereunder shall be assignable by Employee, his
beneficiaries or legal representatives, without the prior written
consent of Employer; provided, however, that nothing shall
preclude (i) Employee from designating a beneficiary to receive
any benefit payable hereunder upon his death, or (ii) the
executors, administrators or other legal representatives of
Employee or his estate from assigning any rights hereunder to the
person or persons entitled thereunto.
(c) Binding Agreement. This Agreement shall be binding
upon, and inure to the benefit of, Employee and Employer and
their respective permitted successors and assigns.
(d) Amendment or Modification of Agreement. This Agreement
may not be modified or amended except by an instrument in writing
signed by the parties hereto.
(e) Insurance. Employer, at its discretion, may apply for
and procure in their own name and for its own benefit, life
insurance on Employee in any amount or amounts considered
advisable; and Employee shall have no right, title or interest
therein, and further, Employee agrees to submit to any medical or
other examination and to execute and deliver any applications or
other instruments in writing as may be reasonably necessary to
obtain such insurance.
(f) Notices. All notices under this Agreement shall be in
writing and shall be deemed effective when delivered in person
(in the case of Employer, to its Chief Executive Officer) or when
mailed, if mailed by certified mail, return receipt requested.
Notices mailed shall be addressed, in the case of Employee, to
him at his residential address currently on file with Employer,
and in the case of Employer, to its corporate headquarters,
attention of the President, or to such other address as Employer
or Employee may designate in writing at any time or from time to
time to the other party. In lieu of notice by deposit in the
U.S. mail, a party may give notice by telegram or telex.
(g) Waiver. No delay or omission by either party hereto in
exercising any right, power or privilege hereunder shall impair
such right, power or privilege, nor shall any single or partial
exercise of any right, power or privilege preclude any further
exercise thereof or the exercise of any other right, power or
privilege. The provisions of this Paragraph 12(g) cannot be
waived except in writing signed by both parties.
(h) Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of North
Carolina, exclusive of its choice of law provisions.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
Employer:
MOUNTAIN AIRCRAFT SERVICES, LLC
By: ____________________________
Its: ___________
Employee:
______________________________
J. XXXXXXX XXXXXX
EXHIBIT A
1. President and Chief Operating Officer of Mountain Aircraft
Services, LLC.
2. Chief Executive Officer of Global Ground Support, LLC.
3. Vice President of Air Transportation Holding Company, Inc.
