EMPLOYMENT AGREEMENT
Exhibit 10.128
This Employment Agreement is hereby entered into by and between US AIRWAYS, INC., a
Delaware corporation having its principal place of business at Crystal Park Four, 0000 Xxxxxxx
Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the “Company”) and XXXX X. XXXXXXX (the “Executive”), as of the
27th day of September, 2005.
W I T N E S S E T H
WHEREAS, the Executive has the responsibilities and duties of the position of Executive Vice
President-Operations for the Company; and
WHEREAS, the Board and the Human Resources Committee of the Board believe it to be in the best
interests of the Company to enter into this Agreement to properly document the terms and conditions
of the Executive’s employment with the Company including, but not limited to, the duties and
obligations of the parties under circumstances in which there is a Change of Control of the
Company;
NOW, THEREFORE, in consideration of the mutual promises herein contained, the Company and the
Executive hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Accrued Obligations shall mean any amounts of Reduced Base Salary plus any accrued
and unused vacation pay that has been earned but not yet paid by the Company, determined as of the
Executive’s Date of Termination.
1.2 Agreement shall mean this Employment Agreement between the Company and the
Executive.
1.3 Affiliate shall mean any parent, brother-sister or subsidiary corporation of the
Company, any joint venture in which the Company owns at least a 50 percent interest, and any
partnership, limited liability partnership or limited liability corporation in which the Company or
any of its wholly-owned Affiliates owns at least a 50 percent interest.
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1.4 Base Salary shall mean the basic rate of pay and does not include any additional
compensation in the form of benefits or perquisites and does not include any reductions to the
basic rate of pay.
1.5 Board shall mean the Board of Directors of Group or the Board of Directors of the
Company, as applicable.
1.6 Cause shall mean:
(a) willful and continued failure to substantially perform his duties with the Company within
fifteen (15) days after a written demand for substantial performance is delivered to the Employee
which identifies the manner in which the Company believes that the Employee has not substantially
performed his duties;
(b) unlawful or willful misconduct which is economically injurious to, or injurious to the
reputation or good will of, the Company or to any entity in control of, controlled by or under
common control with the Company (and its successors);
(c) indictment for or conviction of, or a plea of guilty or nolo contendere, to a felony
charge;
(d) habitual drug or alcohol abuse that impairs the Employee’s ability to perform the
essential duties of his position; or
(e) embezzlement, fraud or any other illegal act against the Company or any illegal act
committed in connection with the Executive’s performance of his duties.
1.7 Change of Control shall mean the occurrence of any of the following events on or
after the Effective Date of this Agreement:
(a) Acquisition of Substantial Percentage. The acquisition by an individual, entity
or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934 (“the 1934 Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the 0000 Xxx) of 30% or more of either (i) the then outstanding shares of common stock of
the Company’s parent, US Airways Group, Inc. (“Group”)(the “Outstanding Group Common Stock”) or
(ii) the combined voting power of the then outstanding voting securities of Group entitled to
vote generally in the election of directors (the “Outstanding Group Voting Securities”);
provided, however, that the following acquisitions shall not constitute a Change of Control:
(1) any acquisition directly from Group;
(2) any acquisition by Group or any of its subsidiaries;
(3) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by Group or any of its subsidiaries;
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(4) any acquisition by any corporation with respect to which, following such
acquisition, more than 85% of, respectively, the then outstanding shares of
common stock of such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to vote generally
in the election of directors, is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and entities who
were beneficial owners, respectively, of the Outstanding Group Common Stock
and Outstanding Group Voting Securities in substantially the same
proportions as their ownership, immediately prior to such acquisition, of
the Outstanding Group Common Stock and Outstanding Group Voting Securities,
as the case may be; or
(5) any acquisition by an individual, entity or group that, pursuant to Rule
13d-1 promulgated under the 1934 Act, is permitted to, and actually does,
report its beneficial ownership of Outstanding Group Common Stock and
Outstanding Group Voting Securities on Schedule 13G (or any successor
Schedule); provided further, that if any such individual, entity or group
subsequently becomes required to or does report its ownership of Outstanding
Group Common Stock and Outstanding Group Voting Securities on Schedule 13D
(or any successor Schedule) then, for purposes of this Section, such
individual, entity or group shall be deemed to have first acquired, on the
first date on which such individual, entity or group becomes required to or
does so file, beneficial ownership of all of the Outstanding Group Common
Stock and Outstanding Group Voting Securities beneficially owned by it on
such date; or
(b) Change of Majority of Board Members. Individuals who, as of the Effective Date
of this Agreement, constitute the Board (the “Incumbent Board”) cease for any reason to
constitute at least a majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for election by Group’s
shareholders, was approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such individual whose initial assumption of office
occurs as a result of either an actual or threatened election contest (as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the 0000 Xxx) or other actual or threatened
solicitation of proxies or consents; or
(c) Reorganization, Merger or Consolidation. There is consummated a reorganization,
merger or consolidation, in each case, with respect to which all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the Outstanding Group
Common Stock and Outstanding Group Voting Securities immediately prior to such reorganization,
merger or consolidation, beneficially own, directly or indirectly, less than 85% of,
respectively, the then outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such reorganization, merger or consolidation
(or any parent thereof) in substantially the same proportions as their ownership, immediately
prior to such reorganization, merger or consolidation of the
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Outstanding Group Common Stock and the Outstanding Group Voting Securities, as the case may
be; or
(d) Disposition of Assets. Approval by the shareholders of Group of a complete
liquidation or dissolution of Group or the consummation of the sale or other disposition of all
or substantially all of the assets of Group, other than to a corporation with respect to which,
following such sale or other disposition, more than 85% of,
respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the Outstanding Group Common Stock
and Outstanding Group Voting Securities immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately prior to such sale or other
disposition, of the Outstanding Group Common Stock and Outstanding Group Voting Securities, as
the case may be.
1.8 Change of Control Date shall mean the first date on which a Change of Control
occurs.
1.9 Change of Control Period shall mean the period beginning on the Change of Control
Date and ending on the day two (2) years thereafter.
1.10 Company shall mean US Airways, Inc., a Delaware corporation, and its Affiliates,
including its successors and assigns.
1.11 Date of Termination means final date of the Executive’s employment.
1.12 Disability shall mean a mental or physical impairment or injury of the Executive
which is determined to result in his total and permanent inability to perform the essential
functions of his position without reasonable accommodation, as determined by the Board of Directors
based on professional medical and/or psychological opinions, or the Executive’s eligibility to
receive disability benefits under the terms and conditions of the Company’s long-term disability
policy, based on an “own occupation” definition under the policy
1.13 Effective Date shall mean the date of the emergence of Group and the Company from
the protection of the U.S. Bankruptcy Court, as defined by Paragraph 1.63 of the Joint Plan of
Reorganization of US Airways Group, Inc. and its Affiliated Debtors, dated August 9, 2005, as
amended and confirmed by that certain Findings of Fact, Conclusions of Law and Order Confirming the
Joint Plan of Reorganization, dated September 16, 2005.
1.14 Good Reason shall mean:
(a) the assignment to the Executive of any duties materially inconsistent with the Executive’s
position, authority, duties or responsibilities as contemplated by this Agreement, or any other
action by the Company which results in a material diminution in such position, authority, duties or
responsibilities; provided, that the Executive has delivered a written notice to the Company which
identifies the manner in which the Executive believes that the assignment or other Company action
would meet the provisions of this paragraph, and the Company has had at
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least fifteen (15) days following delivery of the written notice to correct the assignment or
action and has not done so;
(b) the failure by the Company to reelect the Executive to a position with materially similar
or greater duties than the position held by the Executive on the Effective Date; provided, that the
Executive has delivered a written notice to the Company which identifies the manner in which the
Executive believes that the Company action would meet the provisions of this paragraph, and the
Company has had at least fifteen (15) days following delivery of the written notice to correct the
action and has not done so;
(c) any material failure by the Company to comply with the material provisions of this
Agreement; provided that the Executive has delivered a written notice to the Company which
identifies the manner in which the Executive believes that the Company has failed to meet the
material provisions of this Agreement, and the Company has had at least fifteen (15) days following
delivery of the written notice to correct any such failure and has not done so;
(d) after a Change of Control Date, any failure of the Company (i) to pay Reduced Base Salary,
(ii) to maintain the Executive’s Annual Bonus and Long-Term Incentive Plan target percentages at
the same level as immediately prior to the Change of Control, (iii) to maintain and contribute to
the EDCP (as defined in Section 4.6 hereof) pursuant to the plan document and this Agreement, (iv)
to provide travel privileges to the Executive and his family as in effect prior to the Change of
Control Date or at least equivalent to travel privileges provided to other Key Employees, (v) to
provide the Executive with the same amount of vacation or paid time off as he had prior to the
Change of Control, and (vi) to provide the Executive and the Executive’s family with any other
employee benefit plans, programs, policies and practices at a level comparable to that provided to
other active Key Employees of the Company;
(e) the Company’s requiring the Executive to be based at any office or location further than a
fifty (50) mile radius from the Washington, D.C. metropolitan area, except for travel reasonably
required in the performance of the Executive’s responsibilities;
(f) any purported termination by the Company of the Executive’s employment otherwise than as
expressly permitted by this Agreement; or
(g) any failure by the Company to comply with and satisfy the successor provisions of Section
11.3 of this Agreement.
1.15 Group shall mean U.S. Airways Group, Inc., the parent of the Company.
1.16 Key Employee shall mean any Executive Vice President of the Company or, in the
event of a Change of Control, any officer of a similar level of responsibility.
1.17 Notice of Termination shall mean a written notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of Termination (as defined below)
is other
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than the date of receipt of such notice, specifies the Date of Termination (which date shall
be not more than fifteen (15) days after the giving of such notice).
1.18 Proprietary Information shall mean information that meets the definition of
“trade secret” under the laws of the State of Delaware, as well as any scientific or technical
information, design, process, procedure, formula or improvement that is secret and of value,
information that Group and/or the Company takes reasonable efforts to protect from disclosure and
from which Group and/or the Company derives actual or potential economic value due to its
confidential nature, including, but not limited to, technical or nontechnical data, formulas,
compilations, programs, devices, methods, techniques, drawings, processes, financial data, lists of
actual or potential customers, price lists, business plans, customer and vendor records, training
and operations materials and memoranda, personnel records, financial information relating to the
business of Group and the Company, accounts, customers, vendors, employees and affairs of Group and
the Company, and any information marked “confidential” by Group and/or the Company.
1.19 Reduced Base Salary shall mean the Executive’s Base Salary as reduced pursuant to
Company agreements with unions, Company executive compensation guidelines or agreements between the
Executive and the Company.
1.20 Term shall mean the period during which this Agreement is effective. The Term of
this Agreement is described in Article III hereof.
ARTICLE II
DUTIES AND RESPONSIBILITY
2.1 Duties and Authority. The Executive is engaged and agrees to perform services for
and on behalf of the Company as its Executive Vice President-Operations and shall report directly
to the Chief Executive Officer. The Executive shall have such duties and responsibilities as may
be assigned to him by the Company’s bylaws or by the Chief Executive Officer. The Executive agrees
to perform such duties diligently and efficiently and in accordance with the reasonable directions
of the Chief Executive Officer. The Executive shall conduct himself at all times in a
business-like and professional manner as appropriate for his position and shall represent the
Company in all respects in compliance with good business and ethical practices. In addition, the
Executive shall be subject to and abide by the policies and procedures of the Company applicable to
personnel of the Company, as may be adopted from time to time.
2.2 Best Efforts. During his employment with the Company, excluding any periods of
vacation and sick leave to which the Executive is entitled, subject to the provisions of Section
2.3 below, the Executive shall devote his full attention, energies and best efforts to rendering
services on behalf of the Company (or its Affiliates) and shall not engage in any outside
employment without the express written consent of the Board.
2.3 Outside Activities. During his employment, it shall not be a violation of this
Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees,
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(B) deliver lectures, fulfill speaking engagements or teach at educational institutions and
(C) invest or trade in stocks, bonds, commodities or other forms of investment, including real
property if the Executive does not “participate” (within the meaning of Treas. Reg. §§1.469-5(f)
and 1.469-5T(f)) in such investments, so long as such activities do not significantly interfere
with the performance of the Executive’s responsibilities as an employee of the Company in
accordance with this Agreement. The Executive may also participate in any interest or activity
which is approved in writing by the Board. At least once each year during this Agreement, and at
any time upon the Board’s request, the Executive shall provide a full disclosure to the Corporate
Governance Committee of the Board of his participation in any corporate, civic and charitable
activities (including service on corporate or charitable boards of directors or trustees). Prior
to pursuing or accepting any board membership, teaching position or any other activity which will
require a significant portion of the Executive’s time (other than those in which he is engaged on
the Effective Date), the Executive agrees to discuss such activity with the Human Resources
Committee of the Board.
2.4 No Violation of Other Agreement. By execution of this Agreement, the Executive
hereby warrants and represents to the Company that his acceptance of this employment arrangement
and his performance of the duties and responsibilities described hereunder will not cause him to
violate the terms and conditions of any obligation or agreement to which he is a party and will not
expose the Company to any liability in connection with any such obligation or agreement.
ARTICLE III
AT WILL EMPLOYMENT
3.1 At Will Employment. Prior to a Change of Control, this Agreement shall not have a
specified Term. The employment relationship between the Executive and the Company is one of
“at-will employment,” which provides that either party to the Agreement may terminate the Agreement
at any time for any reason. The parties hereto agree that in the event either desires to terminate
the Agreement, the terminating party shall provide the other party written notice of the
termination.
3.2 Automatic Term Provisions Upon Change of Control. As of a Change of Control Date,
this Agreement automatically shall become effective for a two (2) year Term from that date and
shall terminate on the close of business on the date two (2) years following the Change of Control
Date, unless earlier terminated by the parties pursuant to the provisions hereof.
ARTICLE IV
COMPENSATION AND BENEFITS
4.1 Base Salary. The Company agrees that the Executive’s annual Base Salary is
$425,000, which does not include any benefits or perquisites or reductions. Notwithstanding the
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foregoing, the Company and the Executive have agreed to reductions to the Base Salary, which
will result in the Executive receiving an annual Reduced Base Salary of $317,475. Base Salary and
Reduced Base Salary shall be reviewed at least annually by the Human Resources Committee of the
Board and may be increased from time to time based upon performance.
4.2 Emergence Cash Bonus. Upon the earlier of (a) the date of emergence of Group and
the Company from protection of the U.S. Bankruptcy Court, or (b) December 31, 2005, if the
Executive remains employed on such earlier date, the Company may, at its discretion, provide the
Executive a cash bonus in an amount to be determined by the Human Resources Committee.
4.3 Equity Incentives.
(a) Restricted Stock Award. If the Executive remains employed by the Company at the
time of emergence of Group and the Company from protection of the U.S. Bankruptcy Court, the
Company may, in its discretion, grant to the Executive shares of Restricted Stock under the terms
of the Company’s 2004 Omnibus Stock Incentive Plan (the “Omnibus Plan”) or any successor plan, in
an amount to be determined by the Human Resources Committee. This grant of Restricted Stock
shall be made effective as of the date of emergence and shall vest and become transferable as
follows: 50% of the Restricted Stock shall become vested and nonforfeitable as of the date of
grant, and 25% of the Restricted Stock shall become vested and nonforfeitable on each of the next
two anniversaries of such date of emergence.
(b) Stock Option Grant. If the Executive remains employed by the Company at the
time of emergence of Group and the Company from protection of the U.S. Bankruptcy Court, the
Company may, in its discretion, grant to the Executive a nonqualified stock option for shares of
the Company’s common stock, under the terms of the Company’s 2004 Omnibus Stock Incentive Plan or
any successor plan, in an amount to be determined by the Human Resources Committee. This stock
option shall be granted effective as of the date of emergence, shall have a per share exercise
price equal to the per share fair market value of the common stock on the date of grant, and
shall become exercisable as follows: 50% of the nonqualified stock option shall become
exercisable as of the date of grant, and 25% of the nonqualified stock option shall become
exercisable on each of the next two anniversaries of such date of emergence.
(c) Future Grants and Awards. The Executive shall remain eligible to receive future
grants and awards of restricted stock, options or any other equity-based grants or awards as may
be made under the terms of the Omnibus Plan or any successor plan, as may be determined from time
to time by the Human Resources Committee. Following a Change of Control, the Executive shall
receive equity-based grants and awards at a level comparable and with vesting and exercisability
comparable to any regular and normal course grants and awards made to other Key Employees of the
Company.
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4.4 Annual Bonus. The Executive shall be eligible to participate in the Company’s
annual cash bonus program under the Company’s Incentive Compensation Plan, as determined by the
Human Resources Committee of the Board or any other annual bonus plan hereafter approved by the
Board (“Incentive Plan”). The annual bonus under this Section 4.4 shall hereinafter be referred to
as the “Annual Bonus.”
4.5 Long-Term Incentive Plan. The Executive shall be eligible to participate in the
long-term incentive program under the Company’s Long-Term Incentive Plan, as determined by the
Human Resources Committee of the Board or any other long-term incentive plan hereafter approved by
the Board (“LTIP”).
4.6 Retirement Plans. The Executive shall be eligible to participate in the US
Airways Group, Inc. Funded Executive Defined Contribution Plan and the US Airways Group, Inc.
Unfunded Executive Defined Contribution Plan (the “EDCPs”). While participating in the EDCPs, the
Executive shall not be eligible to receive allocations of any employer contributions under any
tax-qualified retirement plan or to participate in any other nonqualified retirement or deferred
compensation plan sponsored by the Company or Group. EDCP payments reduced after October 11, 2004
shall be restored in monthly installments over a two-year period beginning on October 12, 2006 (the
“Restoration Payments”), as long as the Executive remains employed by the Company. Notwithstanding
the foregoing, in the event that the Executive terminates employment at any time before
commencement of the Restoration Payments or during the period that Restoration Payments are being
made due to (i) death, (ii) Disability, (iii) termination by the Company without Cause, or (iv)
termination by the Executive due to Good Reason, then the Executive shall be immediately eligible
to receive a lump sum payment equivalent to the present value of the Restoration Payments. If the
Executive terminates employment due to termination by the Company for Cause or due to the
Executive’s voluntary termination, then no Restoration Payments shall be made to the Executive’s
account (and/or directly to the Executive), and if Restoration Payments have already commenced,
such payments shall cease as of the Date of Termination.
4.7 Welfare and Fringe Benefit Plans. During his employment with the Company, the
Executive shall be eligible to participate in the Company’s welfare and fringe benefit plans
pursuant to the Company’s plans and policies as in effect for active Key Employees from time to
time. The Company reserves the right to amend or terminate any of its welfare and fringe benefit
plans and policies (including but not limited to coverages and premium structures) at any time.
4.8 Business Expenses. During his employment with the Company, the Executive shall
be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive
in accordance with the expense reimbursement policies and procedures of the Company applicable to
other active Key Employees.
4.9 Withholding, FICA, FUTA, Etc. Any amount to be paid to the Executive under the
provisions of this Agreement which represents taxable income shall be subject to, and reduced by,
any applicable federal, state or local taxes imposed by law, included, but not limited to, taxes
imposed under Subtitle C of the Code.
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ARTICLE V
TERMINATION OF EMPLOYMENT
5.1 Termination of Employment. The Executive’s employment and this Agreement shall be
terminated as follows:
(a) Death: Immediately upon the date of death of the Executive;
(b) Disability: On the tenth (10th) day following written notice provided
by the Board to the Executive that his employment is being terminated due to the Executive’s
Disability;
(c) Termination by Company for Cause: Immediately upon the date of written notice
provided by the Board to the Executive that his employment is being terminated for “Cause”;
(d) Termination by Company Without Cause: Immediately upon the date specified in a
written notice provided by the Board to the Executive that his employment is being terminated
without Cause; or
(e) Termination by Executive for Good Reason: Immediately upon the date specified in
a written notice provided by the Executive to the Board that his employment is being terminated for
Good Reason (following any applicable notice and period for cure as required by the definition of
Good Reason); provided, that if the Executive is terminating for Good Reason due to relocation as
described in Section 1.14(e), the Executive shall provide the Company no less than thirty (30)
days’ advance written notice, unless the Company affirmatively waives such 30-days’ advance notice
requirement; or
(f) Voluntary Resignation by Executive: Upon the date specified in a written notice
provided by the Executive to the Board that he is voluntarily resigning and terminating his
employment, which specified date shall be at least fifteen (15) business days following the date of
delivery of the notice, unless the parties mutually agree to an earlier or later termination date.
5.2 Notice of Termination. Any termination by the Company for Cause or by the
Executive for Good Reason shall be communicated by Notice of Termination to the other party hereto
given in accordance with Sections 5.1(e) and 12.2 of this Agreement. The failure by the Company or
the Executive to set forth in the Notice of Termination any fact or circumstance which contributes
to a showing of Cause or Good Reason shall not waive any right of the Company or the Executive or
preclude the Company or the Executive from asserting such fact or circumstance in enforcing the
terms of this Agreement.
ARTICLE VI
OBLIGATIONS OF THE COMPANY UPON TERMINATION
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6.1 Termination Due to Death. If the Executive’s employment is terminated by reason
of the Executive’s death, this Agreement shall terminate without further obligations to the
Executive’s estate, other than (i) Accrued Obligations that the Executive has accrued or earned as
of the Date of Termination, (ii) any earned but unpaid Annual Bonus from the year prior to the Date
of Termination, and (iii) in the event Annual Bonuses are actually paid to executives for the year
in which the Executive’s death occurs, a prorated bonus equal to the product of the amount of
Annual Bonus that the Executive would have earned at the end of the year times a fraction, the
numerator of which is the number of days in the current year through the Date of Termination and
the denominator of which is 365. The Accrued Obligations shall be paid to the Executive’s estate
in a lump sum in cash within 30 days following the Date of Termination, and the amount of any
Annual Bonus payable to the Executive’s estate shall be payable at the same time that Annual
Bonuses are paid to other executives.
6.2 Termination Due to Disability. If the Executive’s employment is terminated due to
the Executive’s Disability, this Agreement shall terminate as of the Date of Termination without
further obligations to the Executive, other than (i) Accrued Obligations that the Executive has
accrued or earned as of the Date of Termination, (ii) any earned but unpaid Annual Bonus from the
year prior to the Date of Termination, (iii) in the event Annual Bonuses are actually paid to
executives for the year in which the Executive’s Disability occurs, a prorated bonus equal to the
product of the amount of Annual Bonus that the Executive would have earned at the end of the year
times a fraction, the numerator of which is the number of days in the current year through the Date
of Termination and the denominator of which is 365, and (iv) disability and other benefits (to the
extent permitted by law or by the applicable insurance policies) provided by the Company to
disabled employees and/or their families, as the same may change from time to time for Key
Employees. The Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30
days following the Date of Termination and the amount of any Annual Bonus payable to the Executive
shall be payable at the same time that Annual Bonuses are paid to other Key Employees.
6.3 Termination by the Company for Cause. If the Executive’s employment is terminated
by the Company for Cause, this Agreement shall terminate without further obligations to the
Executive other than Accrued Obligations that the Executive has accrued or earned as of the Date of
Termination. All such Accrued Obligations shall be paid to the Executive in a lump sum in cash
within 30 days following the Date of Termination.
6.4 Voluntary Resignation by the Executive. If the Executive terminates his
employment by voluntary resignation (but not for Good Reason), this Agreement shall terminate
without further obligations to the Executive, other than Accrued Obligations that the Executive has
accrued or earned as of the Date of Termination. All such Accrued Obligations shall be paid to the
Executive in a lump sum in cash within 30 days following the Date of Termination.
6.5 Termination by the Company Without Cause or Termination by Executive for Good
Reason.
(a) After the Effective Date, if the Company shall terminate the Executive’s employment
without Cause, or if the Executive shall terminate his employment for Good
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Reason, this Agreement shall terminate and the Company shall pay and/or provide to the
Executive the sum of the following:
(1) Accrued Obligations that the Executive had accrued or earned as of the Date of
Termination;
(2) 200% of the sum of:
(A) the Executive’s Reduced Base Salary, plus
(B) the Executive’s target Annual Bonus (based on Reduced Base
Salary) if the Incentive Plan is then in effect for the year in which
the Date of Termination occurs, or if the Incentive Plan (as
described in Section 4.4 hereof), or any similar annual bonus plan is
not then in effect and its suspension or termination constituted a
Good Reason basis for the Executive’s termination of employment, then
the Executive’s target Annual Bonus under the Incentive Plan
immediately prior to its suspension or termination;
provided however, that if the Executive terminates his employment for
Good Reason as specified in Section 1.14(e) (relating to the
Company’s requiring the Executive to be based at any office or
location further than a fifty (50) mile radius from the Washington,
D.C. metropolitan area), the 200% of Reduced Base Salary and target
Annual Bonus shall be reduced to 100% of such Reduced Base Salary and
target Annual Bonus.
(3) Health Insurance. Payment of a lump sum cash amount equivalent to the cost of
COBRA continuation premiums under the Company’s medical, dental, vision and prescription drug
coverages (as applicable) for the Executive and his covered dependents for eighteen (18) months
following the Date of Termination, regardless of whether the Executive and/or his covered
dependents actually elect COBRA continuation coverage; and
(4) Life Insurance. Continuation of existing life insurance coverage for the
Executive for eighteen (18) months following the Date of Termination on the same premium and
coverage basis as in effect on the Date of Termination; provided that in the event the Company is
not permitted to continue the coverage on the same premium and/or coverage basis by the applicable
carrier or reinsurers, the Company shall pay the Executive a lump sum cash amount equivalent to the
amount of premiums the Company would have paid for the coverage if the Executive had remained an
active employee and the coverage remained in effect on the same premium and coverage basis for the
18-month period; and
(5) Travel Privileges. Immediate vesting and continuation for the Executive’s
lifetime of on-line, first class, positive space travel privileges for business and pleasure for
the Executive and his eligible family members, pursuant to the terms and conditions of the
Company’s travel policy for active Key Employees; provided that the Company shall not provide any
gross-up payments to the Executive or his eligible family members for taxes payable on such travel.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 12 |
(6) Compliance with Code Section 409A. Any payments under this subsection that are
subject to the provisions of Code Section 409A shall be made in accordance with those provisions,
including the delay of at least six (6) months for any severance payments if applicable.
(b) Protected Benefits. Notwithstanding any other provision of this Agreement, if
the Executive’s termination of employment for any reason follows the fifth anniversary of the
Executive’s date of employment with the Company, the Executive shall be entitled to:
(1) Continuation of travel privileges on the same basis as such benefits were provided to the
Executive on the date prior to the termination of employment, or if more favorable to the Executive
and/or the Executive’s family, as in effect at any time thereafter, with such travel privileges to
continue for the life of the Executive;
(2) Continuation of health insurance benefits in the Company’s health insurance program (as
the same may change from time to time) until the Executive reaches age 65 provided that the
Executive continues to pay monthly premiums at the same time and at the same premium rate
applicable to active employees; and provided further, however, that if the Executive should become
eligible for health insurance through a subsequent employer, the Company’s provision of such
benefits shall be secondary to the benefit coverage of the subsequent employer;
(3) a lump sum cash payment in the amount of $70,180, representing the present value of
post-age 65 lifetime medical benefits in lieu of those benefits, and
(4) a lump sum cash payment equal to the difference between the value of the accrued and
unused vacation that was paid to the Executive at the end of the year 2000 and the value that such
accrued and unused vacation would have been if calculated at his current rate of Base Salary as of
the Date of Termination.
ARTICLE VII
CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY
7.1 Gross-Up Payment. In the event it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined
without regard to any additional payments required under this Section), including, but not limited
to, any amounts in respect of (i) options to acquire shares of common stock and (ii) restricted
shares of common stock) (a “Payment”), would be subject to the excise tax imposed by Section 4999
(or any successor provision thereto) of the Code or any interest or penalties with respect to such
excise tax (such excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the “Excise Tax”), then the Executive shall be entitled to receive an
additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of
all taxes (including any interest or penalties imposed with respect to such taxes),
| XXXXXXX EMPLOYMENT AGREEMENT | Page 13 |
including, without limitation, any income and employment taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax, imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon Payments.
7.2 Determinations by Independent Accountants. Subject to the provisions of Section
7.3, all determinations required to be made under this Section 7, including whether a Gross-Up
Payment is required and the amount of such Gross-Up Payment, shall be made by a firm of independent
public accountants selected by Group prior to the Change of Control (the “Accounting Firm”) which
shall provide detailed supporting calculations both to the Company and the Executive within five
(5) business days of the Date of Termination, or such earlier time as is requested by the Company
or the Executive. In the event that the Accounting Firm is serving as accountant or auditor for
the individual, entity or group effecting the Change of Control, the Executive may appoint another
nationally recognized accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses
of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined
pursuant to this Section 7.2, shall be paid to the Executive upon the receipt of the Accounting
Firm’s determination. If the Accounting Firm determines that no Excise Tax is payable by the
Executive, it shall furnish the Executive with a written opinion that failure to report the Excise
Tax on the Executive’s applicable federal income tax return would not result in the imposition of a
negligence or other penalty. Any determination by the Accounting Firm shall be binding upon the
Company and the Executive. As a result of the uncertainty in the application of Section 4999 of
the Code (or any successor provision thereto) at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-up Payments which will not have been made by
the Company should have been made (“Underpayment”), consistent with the calculations required to be
made hereunder. In the event that the Company exhausts its remedies pursuant to Section 7.3 and
the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment (together with interest and penalties incurred by the
Executive in connection therewith) that has occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the Executive.
7.3 IRS Claims. The Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the Company of the
Gross-Up Payment. Such notification shall be given as soon as practicable but no later than ten
(10) business days after the Executive knows of such claim and shall apprise the Company of the
nature of such claim and the date on which such claim is requested to be paid. The Executive shall
not pay such claim prior to the expiration of the thirty-day period following the date on which he
gives such notice to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the Executive in writing prior
to the expiration of such period that it desires to contest such claim, the Executive shall:
(a) give the Company any information reasonably requested by the Company relating to such
claim,
| XXXXXXX EMPLOYMENT AGREEMENT | Page 14 |
(b) take such action in connection with contesting such claim as the Company shall reasonably
request in writing from time to time, including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by the Company,
(c) cooperate with the Company in good faith in order effectively to contest such claim,
(d) permit the Company to participate in any proceedings relating to such claim; provided,
however, that the Company shall bear and pay directly all costs and expenses (including additional
interest and penalties) incurred in connection with such contest and shall indemnify and hold the
Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and payment of costs and
expenses. Without limitation on the foregoing provisions of this Section 7.3, the Company shall
control all proceedings taken in connection with such contest and, at its sole option, may pursue
or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct the Executive to pay
the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay such claim and xxx
for a refund, the Company shall advance the amount of such payment to the Executive, on an
interest-free basis and shall indemnify and hold the Executive harmless, on an after-tax basis,
from any Excise Tax or income tax, including interest or penalties with respect thereto, imposed
with respect to such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested amount is claimed to be
due is limited solely to such contested amount. Furthermore, the Company’s control of the contest
shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder;
whereas the Executive shall be entitled to settle or contest, as the case may be, any other issued
raised by the Internal Revenue Service or any other taxing authority.
7.4 Refunds. If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Section 7.3, the Executive becomes entitled to receive any refund with respect
to such claim, the Executive shall (subject to the Company’s complying with the requirements of
Section 7.3) promptly pay to the Company the amount of such refund (together with any interest paid
or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an
amount advanced by the Company pursuant to Section 7.3, a determination is made that the Executive
shall not be entitled to any refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to the expiration of
thirty (30) days after such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid. Notwithstanding any other provision of this
Section 7.4, the Company shall not make any advance or forgive any amount if such action would be
deemed to be a prohibited loan by the Company in violation of any provision of the Xxxxxxxx-Xxxxx
Act of 2002 or any other law or regulation.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 15 |
ARTICLE VIII
NONEXCLUSIVITY OF RIGHTS
8.1 Notwithstanding any other provision of this Agreement, the Executive (and/or as
applicable, his spouse and/or dependents or his estate) shall be entitled to any benefits or
provisions provided by the specific terms and conditions of any equity-based compensation plans,
insurance policies, or employee benefit plans or programs of the Company in which he participated
as of the Date of his Termination. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan, policy, practice or program of Group, the Company or
any of its Affiliates at or subsequent to the Date of Termination shall be payable in accordance
with the terms and conditions of such plan, policy, practice or program.
ARTICLE IX
RESTRICTIVE COVENANTS
9.1 Use and Return of Documents and Property. Executive acknowledges that in the
course of his employment with the Company, he will have the opportunity to inspect and use certain
property, both tangible and intangible, of Group, the Company and its Affiliates. All such
property shall remain the exclusive property of Group, the Company and its Affiliates, and
Executive has and shall have no right or interest in such property. Executive shall use Company
property only during employment and only in the performance of his job and to further the Company’s
interests, and he will not remove Company property from the Company’s premises except to the
extent necessary to perform his duties and to the extent approved by the Company, either expressly
or generally under its policies. Promptly upon the Executive’s Date of Termination, Executive
shall return to the Company all of the Company’s property of any kind, including but not limited
to, business plans, financial records, computer hardware, computer software, documents, data,
books, memoranda, notes, sketches, audio-visual materials, correspondence, lists, pricing
information, customer and/or vendor lists or information, and all other tangible property.
9.2 New Developments. Any discovery, invention, process or improvement made or
discovered by the Executive during his employment with the Company in connection with or in any way
affecting or relating to the business of Group, the Company or any of its Affiliates (as then
carried on or under active consideration) shall forthwith be disclosed to the Company and shall
belong to and be the absolute property of the Company. The preceding sentence does not apply to
any invention for which no equipment, supplies, facility, trade secret information of the Company
was used and which was developed entirely on the Executive’s own time, unless the invention relates
directly to the business of Group, the Company or its Affiliates or to its or their actual or
demonstrably anticipated research or development, or the invention results from any work performed
by the Executive for the Company.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 16 |
9.3 Nonsolicitation of Customers. Executive agrees that during his employment with
the Company, he will not, directly or indirectly, without the Company’s prior written consent,
contact any customer of the Company or any of its Affiliates for business purposes unrelated to
furthering the business of the Company or its Affiliates. Executive further agrees that for a
period of one (1) year following his Date of Termination, he will not directly or indirectly,
(i) contact, solicit or divert, or attempt to contact, solicit, divert or take away, any customer
of the Company or its Affiliates for purposes of, or with respect to, providing a customer to a
competing business; or (ii) take any affirmative action with a customer of the Company or its
Affiliates for purposes of providing a customer to a business competing with the Company or its
Affiliates. The prohibitions of the preceding sentence shall apply only to customers of the
Company with whom the Executive had Material Contact on the Company’s behalf during the twelve (12)
months immediately preceding the Date of Termination. For purposes of this Agreement, the
Executive had “Material Contact” with a customer if (a) he had business dealings with the
customer on the Company’s behalf; (b) he was responsible for supervising or coordinating the
dealings between the Company and the customer; or (c) he obtained Proprietary Information about
the customer as a result of his association with the Company.
9.4 Nonsolicitation of Employees. The Executive agrees that during his employment
with the Company and for one (1) year after his Date of Termination, the Executive will not,
directly or indirectly, solicit or attempt to recruit or hire any employees of the Company or its
Affiliates who were employed by the Company or its Affiliates at any time during the last year of
the Executive’s employment with the Company and who are actively employed by the Company or its
Affiliates at the time of the solicitation or attempted solicitation, to provide services similar
to those performed by the employee for the Company on behalf of, or for the purpose of engaging in
employment with, a competitor of the Company.
9.5 Nondisclosure of Trade Secrets and Proprietary Information. Except to the extent
reasonably necessary for Executive to perform his duties for the Company, the Executive shall not,
directly or indirectly, furnish or disclose to any person, or use in any way, any trade secrets of
the Company or its Affiliates, for so long as such trade secrets remain “trade secrets” under
applicable state law. Except to the extent reasonably necessary for Executive to perform his
duties for the Company, Executive shall not, during his employment with the Company or following
the Executive’s Date of Termination, directly or indirectly, furnish or disclose to any person, or
use in any way, for personal benefit or the benefit of others, any Proprietary Information of the
Company or its Affiliates.
9.6 No Disparagement. The Executive agrees that he shall not make any untrue or
disparaging statement or criticism, written or oral, nor take any action which is adverse to the
interests of the Company or that would cause the Company or its current and former officers,
directors, or employees embarrassment or humiliation or otherwise cause or contribute to such
persons being held in disrepute by the public or the Company’s customers or employees. From and
after the Date of Termination, the Executive shall refrain from discussing the terms and conditions
of the termination of his employment with any employee or customer of the Company or with any
reporter, media contacts or any form of public media, unless such communication is previously
approved by the General Counsel of the Company.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 17 |
9.7 Reasonableness. Executive has carefully considered the nature and extent of the
restrictions upon his and the rights and remedies conferred on the Company under this Agreement,
and Executive hereby acknowledges and agrees that:
(a) the restrictions and covenants contained herein, and the rights and remedies conferred
upon the Company, are necessary to protect the goodwill and other value of the business of the
Company;
(b) the restrictions places upon Executive hereunder are fair and reasonable in time and
territory, will not prevent him from earning a livelihood, and place no greater restraint upon the
Executive than is reasonably necessary to secure the business and goodwill of the Company;
(c) the Company is relying upon the restrictions and covenants contained herein in continuing
to make available to Executive information concerning the business of the Company;
(d) Executive’s employment hereunder places him in a position of confidence and trust with the
Company and its employees, customers and suppliers; and
(e) the provisions of this section shall be interpreted so as to protect the Proprietary
Information, and to secure for the Company the exclusive benefits of the work performed on behalf
of the Company by the Executive under this Agreement, and not to unreasonably limit his ability to
engage in employment and consulting activities in noncompetitive areas which do not endanger the
Company’s legitimate interests expressed in this Agreement.
9.8 Remedy for Breach. Executive acknowledges and agrees that his breach of any of
the covenants contained in this Article of this Agreement will cause irreparable injury to the
Company and that remedies at law available to the Company for any actual or threatened breach by
the Executive of such covenants will be inadequate and that the Company shall be entitled to
specific performance of the covenants in this Article or injunctive relief against activities in
violation of this Article by temporary or permanent injunction or other appropriate judicial
remedy, writ or order, without the necessity or proving actual damages. This provision with
respect to injunctive relief shall not diminish the right of the Company to claim and recover
monetary damages against the Executive for any breach of this Agreement, in addition to injunctive
relief. In the event of any breach by the Executive, the Company shall be entitled to immediately
cease any and all payments and benefits being provided to the Executive and/or his family and to
seek repayment from the Executive of any severance payments previously paid to him under this
Agreement. The Executive acknowledges and agrees that the covenants contained in this Article
shall be construed as agreements independent of any other provision of this or any other contract
between the parties hereto, and that the existence of any claim or cause of action by the Executive
against the Company, whether predicated upon this or any other contract, shall not constitute a
defense to the enforcement by the Company of said covenants.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 18 |
ARTICLE X
GENERAL RELEASE
10.1 No payment of any kind or provision of any benefit provided under this Agreement shall be
made by the Company to the Executive following his Date of Termination prior to and unless the
Executive executes a general release of all claims that he, his family, heirs and assigns and any
related persons or entities may have against the Company. The release language shall be
substantially in the form attached as Exhibit “A” to this Agreement. It is understood and agreed
that the Executive’s execution of the general release of claims shall not include a release of (i)
the right to payment of or provision of coverage under any vested, nonforfeitable benefits to which
the Executive (or a beneficiary of the Executive) may be entitled under the terms and provisions of
any employee benefit plan, program, practice or policy of the Company as of the Date of
Termination; (ii) any rights to indemnification under the articles or by-laws of the Company, (iii)
rights under any policy of directors and officers liability insurance that covers or has covered
the Executive; and (iv) any right or claim as a stockholder of the Company.
ARTICLE XI
SUCCESSORS
11.1 This Agreement is personal to the Executive and without the prior written consent of the
Company shall not be assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s
estate.
11.2 This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.
11.3 The Company shall require any successor and assign (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to assume expressly 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.
ARTICLE XII
MISCELLANEOUS
12.1 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without reference to principles of conflict of laws. The
captions of this Agreement are not part of the provisions hereof and shall have no
| XXXXXXX EMPLOYMENT AGREEMENT | Page 19 |
force or effect. This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors and legal representatives.
12.2 Notices. All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
If to the Executive
|
If to the Company: | |
Xxxx X. Xxxxxxx
|
US Airways, Inc. | |
| US Airways Group, Inc. | ||
At Most Recent Address on File in
|
0000 Xxxxxxx Xxxxx | |
Company Records
|
Xxxxxxxxx, Xxxxxxxx 00000 | |
| Attention: Executive Vice President, General | ||
| Counsel and Secretary | ||
| America West Holdings Corporation | ||
| 000 Xxxx Xxx Xxxxxx Xxxxxxx | ||
| Xxxxx, XX 00000 | ||
| Attention: Senior Vice President, General | ||
| Counsel |
or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.
12.3 Invalidity of Any Provision. It is the intention of the parties hereto that the
provisions of this Agreement shall be enforced to the fullest extent permissible under the laws of
each state and jurisdiction in which such enforcement is sought, but that the unenforceability (or
the modification to conform with such laws) of any provision hereof shall not render unenforceable
or impair the remainder of this Agreement which shall be deemed amended to delete or modify, as
necessary, the invalid or unenforceable provisions. The parties further agree to alter the balance
of this Agreement in order to render the same valid and enforceable. The terms of the restrictive
covenant provisions of this Agreement shall be deemed modified to the extent necessary to be
enforceable and, specifically, without limiting the foregoing, if the term of the applicable
restrictive covenant is too long to be enforceable, it shall be modified to encompass the longest
term which is enforceable and, if the scope of the geographic area of the applicable restrictive
covenant is too great to be enforceable, it shall be modified to encompass the greatest area that
is enforceable.
12.4 Waiver of Breach. The waiver of a breach of any provision of this Agreement by a
party hereto shall not operate or be construed as a waiver of any subsequent breach by the other
party hereto.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 20 |
12.5 Entire Agreement. This Agreement contains the entire agreement of the parties
with respect to the subject matter hereof. All understanding and agreements (whether written or
oral, including an oral offer of employment or written offer letter) heretofore made between the
parties hereto with respect to the subject matter of this Agreement are superseded by this
Agreement and this Agreement alone fully and completely expresses all agreements between the
parties related to the subject matter. This Agreement may not be changed orally but only by an
amendment in writing signed by both parties. Upon execution of this Agreement, the Executive
hereby waives any rights and claims he may have under any prior understandings and/or agreements
related to his employment (other than those preserved by Section 10.1 hereof), including but not
limited to any rejection damage claims provided under 11 U.S.C. Section 365.
12.6 Survival of Provisions. The provisions of Article IX — Restrictive Covenants
shall survive termination of this Agreement.
12.7 Captions. The captions appearing in this Agreement are inserted only as a matter
of convenience and in no way define, limit, construe or describe the scope or intent of any
provisions of this Agreement or in any way affect this Agreement.
IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the authorization
from its Board of Directors, the Company has caused these presents to be executed in its name on
its behalf, all as of the day and year first above written.
| EXECUTIVE: | ||||||
| US AIRWAYS, INC. | ||||||
| By: | ||||||
| Title: | ||||||
| XXXXXXX EMPLOYMENT AGREEMENT | Page 21 |
EXHIBIT “A”
GENERAL RELEASE
FOR AND IN CONSIDERATION of the payments and benefits provided to XXXX X. XXXXXXX (the
“Executive”) by US AIRWAYS, INC., a Delaware corporation (the “Company”) under the terms and
conditions of that certain Employment Agreement dated the 27th day of September, 2005, upon the
Executive’s Date of Termination, and other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the Executive does hereby, for and on behalf of himself, his heirs,
assigns and all related entities and persons (“Executive’s Releasing Parties”), fully and finally
release, acquit and forever discharge the Company and its parent company, subsidiaries, divisions,
affiliates, successors and assigns, as well as its and their officers, directors, employees,
shareholders, insurers and all related entities and persons, all employee benefit plans of the
Company and all employee benefit plans of its related entities, and such plans’ related entities
and persons (collectively, “Company Released Parties”), of and from any and all claims,
counterclaims, actions, causes of action, demands, rights, damages, costs, expenses or compensation
which the Executive’s Releasing Parties now have, or may have, or may hereafter claim to have had
as of the Date of Termination, whether developed or undeveloped, anticipated or unanticipated,
based on any acts, omissions, transactions or occurrences whatsoever occurring prior to and/or up
until the Date of Termination, and specifically, but not by way of limitation, from those claims
which are, or arise by reason of, or are in any way connected with, or which are or may be based in
whole or in part on the employment relationship which existed between the Executive and the Company
and the termination of that employment relationship, including, without limitation, (i) those
claims arising under any foreign, federal, state, county or municipal fair employment practices act
and/or any law, ordinance or regulation promulgated by any foreign, federal, state, county,
municipality or other state subdivision; (ii) those claims for breach of duty and/or implied
covenant of good faith and fair dealing; (iii) those claims for interference with and/or breach of
contract (express or implied, in fact or in law, oral or written); (iv) those claims for
retaliatory or wrongful discharge of any kind; (v) those claims for intentional or negligent
infliction of emotional distress or mental anguish; (vi) those claims for outrageous conduct; (vii)
those claims for interference with business relationships, contractual relationships or employment
relationships of any kind; (viii) those claims for breach of duty, fraud, fraudulent inducement to
contract, breach of right of privacy, libel, slander, or tortious conduct of any kind; (ix) those
claims arising under Title VII of the Civil Rights Act of 1964 and/or the Civil Rights Act of 1991
and/or 42 U.S.C. Section 1981; (x) those claims arising under any state or federal handicap or
disability discrimination law or act, including but not limited to the Rehabilitation Act of 1973
and the Americans with Disabilities Act; (xi) those claims arising from any damages suffered at any
time by reason of the effects or continued effects of any alleged or actual discriminatory or
wrongful acts; (xii) those claims arising under or in reliance upon any statute, regulation, rule
or ordinance (local, state or federal); (xiii) those claims arising under Employment Retirement
Income Security Act of 1974, as amended, and/or the Family and Medical Leave Act; (xiv) those
claims arising under the workers’ compensation laws of any state or other jurisdiction; and (xv)
| XXXXXXX EMPLOYMENT AGREEMENT | Page 22 |
any and all other claims arising under law or in equity in the United States of America or in
any foreign jurisdiction.
The Executive hereby acknowledges that he is knowingly and voluntarily waiving and releasing
any rights he may have under the Age Discrimination in Employment Act (“ADEA”) and that the
consideration given under the Employment Agreement for this General Release is in addition to
anything of value to which he was already entitled. He further acknowledges that he has been
advised by this writing, as required by the ADEA, that: (A) the waiver and release do not apply to
any rights or claims that may arise on or after the date he executes this Release; (B) he has the
right to consult with an attorney prior to executing this Release;(C) he has
twenty-one (21) days to consider this Release (although he may choose to voluntarily execute this
Release earlier); (D) he has seven (7) days following his execution of this Release to revoke the
Release; and (E) this Release shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after he executes this Release.
Agreed to, acknowledged and executed by the Executive this 15th day of November, 2006.
| XXXXXXX EMPLOYMENT AGREEMENT | Page 23 |
