Exhibit 10.4
WORLD AIR HOLDINGS, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
     THIS AGREEMENT (the “Agreement”) to be effective as of this 1st day of
September, 2006 (the “Effective Date”), between World Air Holdings, Inc. (the
“Company”), and Randy J. Martinez (the “Executive”).
INTRODUCTION
     The Company and the Executive are parties to that certain Fourth Amended
and Restated Employment Agreement dated the 1st day of April, 2004 and now
desire to enter into this Agreement to replace and supersede the existing
employment agreement.
     NOW, THEREFORE, in consideration of the mutual covenants made herein and
for other good and valuable consideration the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. Terms and Conditions of Employment.
     (a) Employment. During the Term, Company will employ the Executive, and the
Executive will serve as the Chief Executive Officer of the Company on a
full-time basis and will have such responsibilities and authority as may from
time to time be assigned to the Executive by the Chairman of the Board, which
responsibilities and authority shall be commensurate with his or her position.
In this capacity, Executive will provide unique services to the Company and be
privy to the Company’s Confidential Information and Trade Secrets. The Executive
will report to the Chairman of the Board. The Executive’s primary office will be
at the Company’s headquarters in Peachtree City, Georgia, or as may be
determined by the Company from time to time.
     (b) Exclusivity. Throughout the Executive’s employment hereunder, the
Executive shall devote substantially all of the Executive’s time, energy and
skill during regular business hours to the performance of the duties of the
Executive’s employment, shall faithfully and industriously perform such duties,
and shall diligently follow and implement all management policies and decisions
of the Company. The Executive will not accept any other employment during the
Term, perform any consulting services during the Term, or serve on the board of
directors or governing body of any other business, except i) with the prior
written consent of the Chairman of the Board or ii) where such services are for
a non-profit organization (or organizations) and do not otherwise interfere with
the performance of the Executives duties as provided herein. The Executive
agrees during the Term not to own directly or indirectly equity securities of
any public airline industry-related entity (excluding the Company) that
represents five percent (5%) or more of the value of voting power of the equity
securities of such entity.
2. Compensation.
     (a) Base Salary. The Company shall pay the Executive a base salary of
$375,000 per annum (“Base Salary”). The Compensation Committee and the Chairman
of the Board of the Company shall review the Base Salary from time to time as
they deem appropriate for possible increases. The Base Salary shall be payable
in substantially equal installments in accordance with the Company’s regular
payroll practices. The Base Salary, as it may be increased from time to time
Executive Employment Agreement — Addison

 

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in accordance with the foregoing, shall not be reduced during the Term unless
the reduction is applied equally, expressed as a percentage of base salaries, to
all senior executives.
     (b) Bonus. The Executive shall be eligible to participate in any one or
more bonus programs maintained by the Company for senior executives generally.
The establishment, continued maintenance and terms and conditions applicable to
any such bonus program shall be determined by the Company in its sole and
absolute discretion.
     (c) Equity Compensation. The Executive shall be entitled to participate in
equity compensation programs made available by the Company from time to time to
senior executives generally (including, but not limited to, grants of stock
options and restricted stock), subject to the terms and conditions of such
programs. The accelerated vesting provisions of this Agreement pertaining to
option awards and restricted stock awards shall apply only to such awards that
are outstanding as of the Effective Date and shall modify such awards only to
the extent such provisions provide Executive with more favorable vesting rights.
     (d) Expenses. The Executive shall be entitled to be reimbursed in
accordance with Company policy including, without limitation, the Company’s
travel policy, as in effect from time to time for reasonable and necessary
business expenses incurred by the Executive in connection with the performance
of the Executive’s duties of employment hereunder; provided, however, the
Executive shall, as a condition of such reimbursement, submit verification of
the nature and amount of such expenses in accordance with the reasonable
reimbursement policies from time to time adopted by the Company.
     (e) Paid Time Off. The Executive shall be entitled to paid time off in
accordance with the terms of Company policy as in effect from time to time.
     (f) Benefits. In addition to the benefits payable to the Executive
specifically described herein, the Executive shall be entitled to such other
benefits as generally may be made available to all other senior executives of
the Company from time to time; provided, however, that nothing contained herein
shall require the establishment or continuation of any particular plan or
program.
     (g) Withholding. All payments pursuant to this Agreement shall be reduced
for any applicable state, local, or federal tax withholding obligations.
     (h) Insurance and Indemnification. The Executive shall be entitled to
indemnification, including advancement of expenses (if applicable), in
accordance with and to the extent provided by the Company’s Bylaws and Articles
of Incorporation, and any separate indemnification agreement between the
parties, if any.
3. Term, Termination and Termination Payments.
     (a) Term. The term of this Agreement shall begin on the Effective Date and
shall continue through the earlier of (i) the close of business on the last
business day immediately preceding the third anniversary of the Effective Date
(the “Initial Term”); or (ii) any earlier termination of employment of the
Executive under this Agreement as provided for in Section 3(b). The Initial Term
and all subsequent renewal periods are referred to herein as the “Term”.
Commencing with the first day of the Initial Term, the Term shall renew each day
such that the Term remains a three-year term from day-to-day thereafter unless
any party gives written notice to the
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other of its or his intent that the automatic renewals shall cease. In the event
such notice of non-renewal is properly given, this Agreement shall expire on the
third anniversary following the date such notice is received. In the event such
notice of non-renewal is properly given, this Agreement shall terminate at the
end of the remaining Term then in effect and the Employer shall have no further
obligation to the Executive.
     (b) Termination. This Agreement and the employment of the Executive by the
Company hereunder shall only be terminated: (i) by expiration of the Term;
(ii) by the Company without Cause; (iii) by the Executive for Good Reason;
(iv) by the Company or the Executive due to the Disability of the Executive;
(v) by the Company for Cause; (vi) by the Executive for other than Good Reason
or Disability, upon at least thirty (30) days prior written notice to the
Company; or (vii) upon the Death of the Executive. Notice of termination by any
party shall be given prior to termination in writing and shall specify the basis
for termination and the effective date of termination. Further, notice of
termination for Cause by the Company or Good Reason by the Executive shall
specify the facts alleged to constitute termination for Cause or Good Reason, as
applicable. Except as provided in Sections 3(c), (d) and (e), the Executive
shall not be entitled to any payments or benefits after the effective date of
the termination of this Agreement, except for Base Salary pursuant to Section
2(a) accrued up to the effective date of termination, pay for accrued but unused
vacation that the Employer is legally obligated to pay Employee, if any, and
only if the Employer is so obligated, as provided under the terms of any other
employee benefit and compensation agreements or plans applicable to the
Executive, expenses required to be reimbursed pursuant to Section 2(d), and any
rights to payment the Executive has under Section 2(h).
     (c) Termination by the Company without Cause or by the Executive for Good
Reason.
     (i) If the employment of the Executive is terminated by the Company without
Cause or by the Executive for Good Reason, the Company will pay the Executive an
amount equal to two (2) times the average of the last three completed calendar
years (or an average of the last two full calendar years actually completed in
the event the Executive has completed less than three full calendar years of
service) of his or her annual total cash compensation (total cash compensation
for purposes of this Section shall mean Base Salary plus Bonus actually paid to
the Executive). Such amount shall be paid as follows: fifty percent (50%) within
fifteen (15) days following the effective date of the termination of employment
and the remaining fifty percent (50%) will be paid on the first to occur of: i)
six (6) months following termination or ii) March 15th of the year following the
year of termination.
     (ii) If the employment of the Executive is terminated by the Company
without Cause or by the Executive for Good Reason, the Company will reimburse
the Executive for the cost of obtaining COBRA health continuation coverage, less
the amount the Executive was required to contribute as an employee, for himself
or herself and his or her eligible dependents under the Company’s applicable
group health plan for the lesser of: twelve (12) months of such coverage, until
the Executive obtains comparable health coverage for himself or herself and his
or her eligible dependents, or the period of coverage to which the Executive is
entitled under Section 4980B(f)(2)(B) of the Internal Revenue Code of 1986, as
amended.
     (iii) If the employment of the Executive is terminated by the Company
without Cause or by the Executive for Good Reason, any unvested stock option
and/or restricted stock grants shall become fully vested immediately prior to
the effective date of the
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termination of employment. To avoid forfeiture, the Executive will be required
to exercise any grant of stock options in accordance with the terms of the
separate agreement granting the same.
     (d) Termination of Employment following a Change in Control.
     (i) If the employment of the Executive is terminated within twelve
(12) months following the effective date of a Change in Control either by the
Company without Cause or by the Executive for Good Reason, the Company will pay
the Executive an amount equal to two (2) times the average of the last three
completed calendar years (or an average of the last two full calendar years
actually completed in the event the Executive has completed less than three full
calendar years of service) of his or her annual total cash compensation (total
cash compensation for purposes of this Section shall mean Base Salary plus Bonus
actually paid to the Executive). Such amount shall be paid in a lump sum within
fifteen (15) days following the effective date of the termination of employment.
To avoid forfeiture, the Executive will be required to exercise any grant of
stock options in accordance with the terms of the separate agreement granting
the same.
     (ii) If the employment of the Executive is terminated within twelve
(12) months following the effective date of a Change in Control either by the
Company without Cause or by the Executive for Good Reason, the Company will
reimburse the Executive for the cost of obtaining COBRA health continuation
coverage, less the amount the Executive was required to contribute as an
employee, for himself or herself and his or her eligible dependents under the
Company’s applicable group health plan for the lesser of: twelve (12) months of
such coverage, until the Executive obtains comparable health coverage for
himself or herself and his or her eligible dependents, or the period of coverage
to which the Executive is entitled under Section 4980B(f)(2)(B) of the Internal
Revenue Code of 1986, as amended.
     (e) Disability or Death Payment. If the employment of the Executive is
terminated by Disability or Death, any unvested stock option grants or
restricted stock awards shall become fully vested immediately prior to the
effective date of the termination of employment. To avoid forfeiture, the
Executive or his or her legal representative will be required to exercise any
grant of stock options in accordance with the terms of the separate agreement
granting the same. The Company will also reimburse the Executive or the
Executive’s spouse and any eligible minor dependents for the cost of COBRA
health continuation coverage, less the Executive’s own contribution amount,
under the Company’s applicable group health plan for the lesser of twelve (12)
months of such coverage or until the Executive or the Executive’s spouse and
eligible minor dependents obtain comparable health coverage.
     (f) Tax Adjustment Payment. If the total payments to be paid to the
Executive under Section 3(c) or (d), as applicable, along with any other
payments to the Executive result in the Executive being subject to the excise
tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended,
the Company shall pay the Executive such additional cash compensation to put him
or her in the same after-tax situation (taking into account all income, excise,
and payroll taxes) as if no such excise tax had been applicable (the “Tax
Adjustment Payment”). The Tax Adjustment Payment shall be paid as soon as
practicable following the Executive’s termination of employment. The
determination of the excise tax and the additional cash compensation (if any)
required hereunder will be made by the Company’s independent outside auditors.
Notwithstanding the foregoing, the Company’s obligation to pay any Tax
Adjustment Payment shall be conditioned upon the
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Executive’s agreement to structure any payments due to him or her under this
Agreement in a manner that will eliminate or reduce the excise tax that is
payable; provided that the Executive is under no obligation to agree to any such
restructuring requested by the Company that would trigger any material adverse
tax consequences to the Executive or would materially reduce the value of the
payments otherwise due to him or her.
     (g) Expiration of Term. If the Term is not extended or the Term is not
extended and the Company or the Executive terminates the Executive’s employment
upon or following expiration of the Term, such termination shall not be deemed
to be a termination of the Executive’s employment by the Company without Cause
or a resignation by Executive for Good Reason.
     (h) Release. Notwithstanding any other provision hereof, as a condition to
the payment of any amounts in this Section, the Executive shall be required to
execute and not revoke within the revocation period provided therein, the
Release.
     (i) Avoidance of Additional Taxes. Notwithstanding any other provision
hereof, if the payment of any amounts by the Company hereunder would fail to
meet the requirements of Section 409A(a)(1) of the Internal Revenue Code of
1986, as amended, no payment of such amounts hereunder shall be made until six
months after the Executive’s termination of employment, at which time the
Executive shall be paid a lump sum equal to what would otherwise have been paid
during such six-month period, and thereafter payment of the unpaid balance, if
any, shall continue on what would otherwise have been the original payment
schedule for such unpaid balance.
     (j) Accelerated Vesting of Equity Compensation. In the event of a Change in
Control, all unvested stock option grants or restricted stock awards shall vest
immediately prior to the effective date of the Change in Control.
4. Ownership and Protection of Proprietary Information.
     (a) Confidentiality. All Confidential Information and Trade Secrets and all
physical embodiments thereof received or developed by the Executive while
employed by the Company are confidential to and are and will remain the sole and
exclusive property of the Company. Except to the extent necessary to perform the
duties assigned by the Company hereunder, the Executive will hold such
Confidential Information and Trade Secrets in trust and strictest confidence,
and will not use, reproduce, distribute, disclose or otherwise disseminate the
Confidential Information and Trade Secrets or any physical embodiments thereof
and may in no event take any action causing or fail to take the action necessary
in order to prevent, any Confidential Information and Trade Secrets disclosed to
or developed by the Executive to lose its character or cease to qualify as
Confidential Information or Trade Secrets.
     (b) Return of Company Property. Upon request by the Company, and in any
event upon termination of this Agreement for any reason, as a prior condition to
receiving any final compensation hereunder (including any payments pursuant to
Section 3 hereof), the Executive will promptly deliver to the Company all
property belonging to the Company, including, without limitation, all
Confidential Information and Trade Secrets (and all embodiments thereof) then in
the Executive’s custody, control or possession.
     (c) Survival. The covenants of confidentiality set forth herein will apply
on and after the date hereof to any Confidential Information and Trade Secrets
disclosed by the Company or
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developed by the Executive while employed or engaged by the Company prior to or
after the date hereof. The covenants restricting the use of Confidential
Information will continue and be maintained by the Executive for a period of two
years following the termination of this Agreement. The covenants restricting the
use of Trade Secrets will continue and be maintained by the Executive following
termination of this Agreement for so long as permitted by the governing law.
5. Non-Competition and Non-Solicitation Provisions.
     (a) The Executive agrees that during the Applicable Period, the Executive
will not (except on behalf of or with the prior written consent of the Company,
which consent may be withheld in Company’s sole discretion), either directly or
indirectly, on his or her own behalf, or in the service of or on behalf of
others, engage in or provide managerial services or management consulting
services to, any Competing Business. The Executive acknowledges and agrees that
the Business of the Company is conducted on a worldwide basis.
     (b) The Executive agrees that during the Applicable Period, the Executive
will not, either directly or indirectly, on his or her own behalf or in the
service of or on behalf of others solicit, divert or appropriate, or attempt to
solicit, divert or appropriate, to a Competing Business, any individual or
entity which is an actual or, to his knowledge, actively sought prospective
client or customer of the Company or any of its Affiliates (determined as of
date of termination of employment) with whom Executive had material contact
during a two year period immediately preceding his termination of employment.
     (c) The Executive agrees that during the Applicable Period, he or she will
not, either directly or indirectly, on his or her own behalf or in the service
of or on behalf of others, solicit, divert or hire, or attempt to solicit,
divert or hire, or encourage to go to work for anyone other than the Company or
its Affiliates, any employee of the Company or an Affiliate.
     (d) The Executive agrees that during the Applicable Period, he or she will
not make any statement (written or oral) that could reasonably be perceived as
disparaging to the Company or any person or entity that the Executive reasonably
should know is an Affiliate of the Company.
     (e) In the event that this Section 5 is determined by a court which has
jurisdiction to be unenforceable in part or in whole, the court shall be deemed
to have the authority to strike any unenforceable provision, or any part thereof
or to revise any provision to the minimum extent necessary to be enforceable to
the maximum extent permitted by law.
6. Remedies and Enforceability.
     The Executive agrees that the covenants, agreements, and representations
contained in Sections 4 and 5 hereof are of the essence of this Agreement; that
each of such covenants are reasonable and necessary to protect and preserve the
interests and properties of the Company; that irreparable loss and damage will
be suffered by the Company should the Executive breach any of such covenants and
agreements; that each of such covenants and agreements is separate, distinct and
severable not only from the other of such covenants and agreements but also from
the other and remaining provisions of this Agreement; that the unenforceability
of any such covenant or agreement shall not affect the validity or
enforceability of any other such covenant or agreements or any other provision
or provisions of this Agreement; and that, in addition to other remedies
available to it, including, without limitation, termination of the Executive’s
employment for Cause, the Company
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shall be entitled to seek both temporary and permanent injunctions to prevent a
breach or contemplated breach by the Executive of any of such covenants or
agreements and shall be relieved of its obligation to make any and all payments
to the Executive that otherwise are or may become due and payable to the
Executive pursuant to Section 3. The Company and the Executive agree that all
remedies available to the Company shall be cumulative.
7. Employee Inventions.
     Each Employee Invention will belong exclusively to the Company. The
Executive acknowledges that all Employee Inventions are property of the Company,
including, but not limited to, any copyrights, patents, trademarks or other
intellectual property rights pertaining thereto. If it is determined that any
such works are not works made for hire, the Executive hereby assigns to the
Company all of the Executive’s right, title, and interest, including all rights
of copyright, patent, trademark and other intellectual property rights to, or
in, such Employee Inventions. The Executive covenants that he or she shall
promptly:
     (a) Disclose to the Company in writing any Employee Invention;
     (b) Assign to the Company or to a party designated by the Company, at the
Company’s request and without additional compensation, all of Executive’s right
to Employee Inventions for the United States and all foreign jurisdictions;
     (c) Execute and deliver to the Company such applications, assignments and
other documents as the Company may request in order to apply for and obtain
patents or other registrations with respect to any Employee Invention in the
United States and any foreign jurisdictions;
     (d) Sign all other papers necessary to carry out the above obligations; and
     (e) Give testimony and render any other assistance, at the Company’s
expense, in support of Company’s rights to any Employee Invention.
8. Notices.
     All notices and other communications required or permitted under this
Agreement shall be in writing and shall be delivered by hand or, if mailed,
shall be sent via the United States Postal Service, certified mail, return
receipt requested, or by a nationally recognized overnight courier service. All
notices hereunder shall be deemed effective when delivered. All notices and
other communications under this Agreement shall be given to the parties hereto
at the following addresses (or at such other addresses as shall be given in
writing by the parties to one another):

     
If to the Company:
  If to the Executive:
 
   
World Air Holdings, Inc.
  Charles H. J. Addison
101 World Drive
  407 Camden Cope
Peachtree City, GA 30269
  Peachtree City, GA 30269
Attn: The Office of the General Counsel
   

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9. Miscellaneous.
     (a) Assignment. The rights and obligations of the Company under this
Agreement shall inure to the benefit of the Company’s successors and assigns.
This Agreement may be assigned by the Company to any legal successor to the
Company’s business or to an entity that purchases all or substantially all of
the assets of the Company, but not otherwise without the prior written consent
of the Executive. In the event the Company assigns this Agreement as permitted
by this Agreement and the Executive remains employed by the assignee, the
“Company” as defined herein will refer to the assignee and the Executive will
not be deemed to have terminated his or her employment hereunder until the
Executive terminates his or her employment with the assignee. The Executive may
not assign this Agreement.
     (b) Waiver. The waiver of any breach of this Agreement by any party shall
not be effective unless in writing, and no such waiver shall constitute the
waiver of the same or another breach on a subsequent occasion.
     (c) No Set-Off. The existence of any claim, demand, action or cause of
action by the Executive against the Company, or any Affiliate of the Company,
whether predicated upon this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Company of any of its rights hereunder.
     (d) Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Georgia. The parties agree
that any appropriate state or federal court located in Fulton County, Georgia
shall have exclusive jurisdiction of any case or controversy arising under or in
connection with this Agreement and shall be a proper forum in which to
adjudicate such case or controversy. The parties consent to the jurisdiction of
such courts and waive any objection to the jurisdiction or venue of such courts.
     (e) Entire Agreement. This Agreement embodies the entire agreement of the
parties hereto relating to the subject matter hereof and supersedes all oral
agreements, and to the extent inconsistent with the terms hereof, all other
written agreements.
     (f) Amendment. This Agreement may not be modified, amended, supplemented or
terminated except by a written instrument executed by the parties hereto.
     (g) Severability. Each of the covenants and agreements hereinabove
contained shall be deemed separate, severable and independent covenants, and in
the event that any covenant shall be declared invalid by any court of competent
jurisdiction, such invalidity shall not in any manner affect or impair the
validity or enforceability of any other part or provision of such covenant or of
any other covenant contained herein.
     (h) Representation Regarding Restrictive Covenants. The Executive
represents that the Executive is not and will not become a party to any
non-competition or non-solicitation agreement or any other agreement which would
prohibit him or her from entering into this Agreement or providing the services
for the Company contemplated by this Agreement on or after the Effective Date.
In the event the Executive is or becomes subject to any such agreement, this
Agreement shall be rendered null and void and the Company shall have no
obligations to the Executive under this Agreement.
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     (i) Survival. The obligations of the Company and the Executive under this
Agreement shall survive termination of this Agreement.
     (j) Waiver of Jury Trial. The Executive waives the right to a jury trial
with respect to any litigation or complaint filed against the Company or any
Affiliate, including but not limited to complaints arising under this Agreement
or as a result of the employment relationship between the parties.
     (k) Limitations Period for Disputes. The Executive shall not commence any
action, claim or suit relating to his or her employment or this Agreement more
than six (6) months after the date of the act (or the failure to act) that is
the subject of such action, claim or suit. The Executive hereby waives any
statute of limitations or other law to the contrary.
     (l) Captions and Section Headings. Except as set forth in Section 10
hereof, captions and section headings used herein are for convenience only and
are not a part of this Agreement and shall not be used in construing it.
10. Definitions.
     (a) “Affiliate” means any person, firm, corporation, partnership,
association or entity that, directly or indirectly or through one or more
intermediaries, controls, is controlled by or is under common control with the
Company.
     (b) “Applicable Period” means the period commencing as of the date of this
Agreement and ending twelve (12) months after the termination of the Executive’s
employment with the Company or any of its affiliates with respect to the
Executive’s engagement in or providing of any managerial services or management
consulting services to a Competing Business and shall mean a period of
twenty-four (24) months following termination for all other forms of restrictive
covenants provided for herein (e.g., Confidential Information, solicitation of
customers or employees, etc.).
     (c) “Business of the Company” means the business of providing long-range
passenger and cargo charter and wet lease air transportation services as an
international supplemental operations carrier (which shall not include any
scheduled service carrier) holding a certificate of public convenience and
necessity issued by the U. S. Department of Transportation.
     (d) “Cause” means the occurrence of any of the following events:
     (i) willful refusal by the Executive to follow a lawful direction of any
superior officer of the Company, provided the direction is not materially
inconsistent with the duties or responsibilities of the Executive’s position as
Chief Executive Officer of the Company, which refusal continues after the
Chairman of the Board of the Company has again given the direction in writing;
     (ii) sustained performance deficiencies which are communicated to the
Executive in writing as part of formal performance reviews and/or other written
communications from the Chairman of the Board of the Company;
     (iii) willful misconduct or reckless disregard by the Executive of his or
her duties or of the interest or property of the Company;
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     (iv) intentional disclosure by the Executive to an unauthorized person of
Confidential Information or Trade Secrets, which causes material harm to the
Company;
     (v) any act by the Executive of fraud against, material misappropriation
from, or significant dishonesty to either the Company or an Affiliate, or any
other party, but in the case of any other party only if in the reasonable
opinion of at least two-thirds (2/3) of the members of the Board of Directors of
the Company (excluding, if applicable, the Executive), such fraud, material
misappropriation, or significant dishonesty could reasonably be expected to have
a material adverse impact on the Company or its Affiliates;
     (vi) commission by the Executive of a felony as reasonably determined by at
least two-thirds (2/3) of the members of the Board of Directors of the Company
(excluding, if applicable, the Executive); or
     (vii) a material breach of this Agreement by the Executive, provided that
the nature of such breach shall be set forth with reasonable particularity in a
written notice to the Executive who shall have ten (10) days following delivery
of such notice to cure such alleged breach, provided that such breach is, in the
reasonable discretion of the Board of Directors of the Company, susceptible to a
cure.
(e) “Change in Control” means the occurrence after the Effective Date of any one
or more of the following events:
     (i) any Person, other than the Company, is or becomes the Beneficial Owner
(as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)), directly or indirectly, of securities of the Company
representing more than 50% of the combined voting power of the Company’s then
outstanding securities;
     (ii) during any period of two (2) consecutive years (not including any
period prior to the Effective Date), individuals who at the beginning of such
period constitute the Board of Directors of the Company and any new director
(other than a director designated by a Person who has entered into an agreement
with the Company to effect a transaction described in clause (i), (iii) or
(iv) or this Section 10 (e)) whose election by the Board of Directors of the
Company or nomination for election by the stockholders of the Company was
approved by a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof;
     (iii) the shareholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than (A) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or being converted into voting securities of the surviving entity),
in combination with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any of its
Affiliates, at least 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding immediately after such
merger or consolidation, or (B) a merger or consolidation effected to implement
a recapitalization of the Company (or similar transaction) in which no Person
acquires more than 50% of the combined voting power of the Company then
outstanding securities; or
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     (iv) the shareholders of the Company approve a plan of complete liquidation
of the Company or an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets.
     (f) “Competing Business” means any person, firm, corporation, joint
venture, or other business that is engaged in the Business of the Company.
     (g) “Confidential Information” means data and information relating to the
Business of the Company or an Affiliate (which does not rise to the status of a
Trade Secret) which is or has been disclosed to the Executive or of which the
Executive became aware as a consequence of or through his or her relationship to
the Company or an Affiliate and which has value to the Company or an Affiliate
and is not generally known to its competitors. Confidential Information shall
not include any data or information that has been voluntarily disclosed to the
public by the Company or an Affiliate (except where such public disclosure has
been made by the Executive without authorization) or that has been independently
developed and disclosed by others, or that otherwise enters the public domain
through lawful means without breach of any obligations of confidentiality owed
to the Company or any of its Affiliates by the Executive.
     (h) “Death” means an individual who has sustained either (1) irreversible
cessation of circulatory and respiratory functions, or (2) irreversible
cessation of all functions of the entire brain, including the brain stem. A
determination of death must be made in accordance with accepted medical
standards.
     (i) “Disability” means the inability of the Executive to perform the
material duties of his or her position, through no fault of their own, hereunder
due to a physical, mental, or emotional impairment, for a ninety
(90) consecutive day period or for aggregate of one hundred eighty (180) days
during any three hundred sixty-five (365) day period.
     (j) “Employee Invention” any idea, invention, technique, modification,
process or improvement (whether patentable or not), any industrial design
(whether registerable or not), and any work of authorship, publication (whether
or not copyright protection may be obtained for it) created, conceived or
developed by the Executive, either solely or in conjunction with others
(including the Company and the Executive’s other previous employers), during or
before the Term, or during a period that includes a portion of the Term, that
relates to the business then being conducted or proposed to be conducted by the
Company and any such item created by the Executive, either solely or in
conjunction with others, following termination of the Executive’s employment
with the Company that is based upon, contains, consists of or uses Confidential
Information. The Company will exclude items from the Employee Inventions that
are not related to the present or proposed business of the Company or its
Affiliates or that cannot be assigned under applicable state law, provided
however that the Executive notifies the Company of the existence of any such
item within ninety (90) days of its creation by the Executive.
     (k) “Good Reason” means the occurrence of all of the events listed in
either (i), (ii) or (iii) below:
     (i)
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     (A) the Company materially breaches this Agreement, including without
limitation, a material diminution of the Executive’s responsibilities as Chief
Executive Officer, as reasonably modified by the Chairman of the Board of the
Company from time to time hereafter, such that the Executive would no longer
have responsibilities substantially equivalent to those of similarly situated
executive officers at companies with similar revenues and market capitalization;
     (B) the Executive gives written notice to the Company of the facts and
circumstances constituting the breach of the Agreement within ten (10) days
following the occurrence of the breach;
     (C) the Company fails to remedy the breach within ten (10) days following
the Executive’s written notice of the breach; and
     (D) the Executive terminates his or her employment within ten (10) days
following the Company’s failure to remedy the breach; or
     (ii)
     (A) the Company materially reduces the Executive’s Base Salary without the
Executive’s consent, other than in accordance with Section 2(a) above;
     (B) the Executive gives written notice to the Company within ten (10) days
following receipt of the reduction in Base Salary of his or her objection to the
reduction;
     (C) the Company fails to rescind the notice of reduction within ten
(10) days following the Executive’s written notice; and
     (D) the Executive terminates his or her employment within ten (10) days
following the Company’s failure to rescind the notice; or
     (iii)
     (A) the Company requires the Executive to relocate the Executive’s primary
place of employment to a new location that is more than fifty (50) miles
(calculated using the most direct driving route) from its current location,
without the Executive’s consent;
     (B) the Executive gives written notice to the Company within ten (10) days
following receipt of notice of relocation of his or her objection to the
relocation;
     (C) the Company fails to rescind the notice of relocation within ten
(10) days following the Executive’s written notice; and
     (D) the Executive terminates his employment within ten (10) days following
the Company’s failure to rescind the notice.
     (l) “Person” has the meaning given to the term in Section (3)(a)(9) of the
Exchange Act, as modified and used in Section 13(d) and 14(d) thereof; however,
a Person shall not include (i) the
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Company or any of its subsidiaries or other Affiliates; (ii) a trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
any of its subsidiaries; (iii) an underwriter temporarily holding securities
pursuant to an offering of such securities; or (iv) a corporation owned,
directly or indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of stock of the Company.
     (m) “Release” means a comprehensive release, covenant not to sue, and
non-disparagement agreement from the Executive in favor of the Company, its
executives, officers, directors, Affiliates, and all related parties, in
substantially the form attached hereto as Exhibit A. Exhibit A may be reasonably
modified by the Company to conform to applicable law and to effect a general
release under such law as in effect at the time the Release is executed.
     (n) “Term” has the meaning as set forth in Section 3(a) hereof.
     (o) “Trade Secrets” means information including, but not limited to,
technical or nontechnical data, formulae, patterns, compilations, programs,
devices, methods, techniques, drawings, processes, financial data, financial
plans, product plans or lists of actual or potential customers or suppliers
which (i) derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other persons
who can obtain economic value from its disclosure or use, and (ii) is the
subject of efforts that are reasonable under the circumstances to maintain its
secrecy.
     IN WITNESS WHEREOF, the Company and the Executive have each executed and
delivered this Agreement as of the date first shown above.
COMPANY:
WORLD AIR HOLDINGS, INC.

         
By:
       
 
 
 
Randy J. Martinez,    
 
  Chief Executive Officer    
 
        THE EXECUTIVE:    
 
       
 
       
 
 
 
Charles H. J. Addison    

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EXHIBIT A
RELEASE AGREEMENT PURSUANT TO
EMPLOYMENT AGREEMENT
     This Agreement (“Release Agreement”) is made this ___ day of ___, 200_, by
WORLD AIR HOLDINGS, INC. (the “Employer”) and                      (the
“Employee”).
Introduction
     Employee and the Employer entered into an Employment Agreement dated
                    , 200___ (the “Employment Agreement”). The Employment
Agreement requires that as a condition to the Employer’s obligation to pay
payments and benefits under Section 3(c), (d), or (e) of the Employment
Agreement (the “Severance Benefits”), Employee must provide a release and agree
to certain other conditions as provided herein.
     NOW, THEREFORE, the parties agree as follows:

1.   [For Employee under age 40: The effective date of this Release Agreement
shall be the date on which Employee signs this Release Agreement (“the Effective
Date”), at which time this Release Agreement shall be fully effective and
enforceable.]

[For Employee age 40 and over or group termination of Employees age 40 and over:
Employee has been offered [twenty-one (21) days] [forty-five (45) days if group
termination] from receipt of this Release Agreement within which to consider
this Release Agreement. The effective date of this Release Agreement shall be
the date eight (8) days after the date on which Employee signs this Release
Agreement (“the Effective Date”). For a period of seven (7) days following
Employee’s execution of this Release Agreement, Employee may revoke this Release
Agreement, and this Release Agreement shall not become effective or enforceable
until such seven (7) day period has expired. Employee must communicate the
desire to revoke this Release Agreement in writing. Employee understands that he
or she may sign the Release Agreement at any time before the expiration of the
[twenty-one (21) day] [forty-five (45) day] review period. To the degree
Employee chooses not to wait [twenty-one (21) days] [forty-five (45) days] to
execute this Release Agreement, it is because Employee freely and unilaterally
chooses to execute this Release Agreement before that time. Employee’s signing
of the Release Agreement triggers the commencement of the seven (7) day
revocation period.]

2.   In exchange for Employee’s execution of this Release Agreement and in full
and complete settlement of any claims as specifically provided in this Release
Agreement, the Employer will provide Employee with the Severance Benefits.

3.   [For Employee age 40 or over or group termination of Employees age 40 and
over: Employee acknowledges and agrees that this Release Agreement is in
compliance with the Age Discrimination in Employment Act and the Older Workers
Benefit Protection Act and that the releases set forth in this Release Agreement
shall be applicable, without limitation, to any claims brought under these
Acts.]

The release given by Employee in this Release Agreement is given solely in
exchange for the consideration set forth in Paragraph 2 of this Release
Agreement and such consideration is in
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addition to anything of value that Employee was entitled to receive prior to
entering into this Release Agreement.
Employee has been advised to consult an attorney prior to entering into this
Release Agreement [For Employee age 40 or over or group termination of Employees
age 40 and over: and this provision of the Release Agreement satisfies the
requirement of the Older Workers Benefit Protection Act that Employee be so
advised in writing].
[For under age 40: Employee has been offered an ample opportunity from receipt
of this Release Agreement within which to consider this Release Agreement.]

    By entering into this Release Agreement, Employee does not waive any rights
or claims that may arise after the date this Release Agreement is executed.   4.
            [For group termination of Employees age 40 and over: The Employer
has
                                                                                
[The Employer to describe class, unit, or group of individuals covered by
termination program, any eligibility factors, and time limits applicable] and
such employees comprise the “Decisional Unit.” Attached as “Attachment 1” to
this Release Agreement is a list of ages and job titles of persons in the
Decisional Unit who were and who were not selected for termination, the reasons
for selection and the offer of consideration for signing the Release Agreement.]
  5.             This Release Agreement shall in no way be construed as an
admission by the Employer that it has acted wrongfully with respect to Employee
or any other person or that Employee has any rights whatsoever against the
Employer. The Employer specifically disclaims any liability to or wrongful acts
against Employee or any other person on the part of itself, its employees or its
agents.   6.             As a material inducement to the Employer to enter into
this Release Agreement, Employee hereby irrevocably releases the Employer and
each of the owners, stockholders, predecessors, successors, directors, officers,
employees, representatives, attorneys, affiliates (and agents, directors,
officers, employees, representatives and attorneys of such affiliates) of the
Employer and all persons acting by, through, under or in concert with them
(collectively, the “Releasees”), from any and all charges, claims, liabilities,
agreements, damages, causes of action, suits, costs, losses, debts and expenses
(including attorneys’ fees and costs actually incurred) of any nature
whatsoever, known or unknown, including, but not limited to, rights arising out
of alleged violations of any contracts, express or implied, any covenant of good
faith and fair dealing, express or implied, or any tort, or any legal
restrictions on the Employer’s right to terminate employees, or any federal,
state or other governmental statute, regulation, or ordinance, including,
without limitation: (1) Title VII of the Civil Rights Act of 1964, as amended by
the Civil Rights Act of 1991 (race, color, religion, sex, and national origin
discrimination); (2) the Employee Retirement Income Security Act (“ERISA”);
(3) 42 U.S.C. § 1981 (discrimination); (4) the Americans with Disabilities Act
(disability discrimination); (5) the Equal Pay Act; (6) the Age Discrimination
in Employment Act; (7) the Older Workers Benefit Protection Act; (8) Executive
Order 11246 (race, color, religion, sex, and national origin discrimination);
(9) Executive Order 11141 (age discrimination); (10) Section 503 of the
Rehabilitation Act of 1973 (disability discrimination); (11) the Immigration
Reform and Control Act; (12) the Occupational Safety and Health Act; (13) the
False Claims Act (including any qui tam provision thereof); (14) defamation;
(15) whistleblowing; (16) breach of contract, express or implied;
(17) negligence; (18) negligent hiring and/or negligent retention;
(19) intentional or negligent infliction of emotional distress or outrage;
(20) defamation; (21) interference with employment; (22) wrongful discharge;
(23) invasion of privacy; or (24) violation of any other legal or contractual

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    duty arising under the laws of the State of Georgia or the laws of the
United States (“Claim” or “Claims”), which Employee now has, or claims to have,
or which Employee at any time heretofore had, or claimed to have, or which
Employee at any time hereinafter may have, or claim to have, against each or any
of the Releasees, in each case as to acts or omissions by each or any of the
Releasees occurring up to and including the Effective Date.   7.        The
release in the preceding paragraph of this Release Agreement does not apply to
(a) all benefits and awards (including without limitation cash and stock
components) which pursuant to the terms of any compensation or benefit plans,
programs, or agreements of the Employer are earned or become payable, but which
have not yet been paid, and (b) pay for accrued but unused vacation that the
Employer is legally obligated to pay Employee, if any, and only if the Employer
is so obligated, (c) unreimbursed business expenses for which Employee is
entitled to reimbursement under the Employer’s policies, and (d) any rights to
indemnification that Employee has under any directors and officers or other
insurance policy the Employer maintains or under the bylaws and articles of
incorporation of the Company, and under any indemnification agreement, if any.  
8.        Employee promises that he or she has not and will not make statements
disparaging to any of the Releasees. Employee agrees not to make any statements
about any of the Releasees to the press (including without limitation any
newspaper, magazine, radio station, television station or internet media)
without the prior written consent of the Employer. The obligations set forth in
the two immediately preceding sentences will expire two years after the
Effective Date. Employee will also cooperate with the Employer and its
affiliates if the Employer requests Employee’s testimony. To the extent
practicable and within the control of the Employer, the Employer will use
reasonable efforts to schedule the timing of Employee’s participation in any
such witness activities in a reasonable manner to take into account Employee’s
then current employment, and will pay the reasonable documented out-of-pocket
expenses that the Employer pre-approves and that Employee incurs for travel
required by the Employer with respect to those activities.   9.        Except as
set forth in this Section, Employee agrees not to disclose the existence or
terms of this Release Agreement to anyone. However, Employee may disclose it to
a member of his or her immediate family or legal or financial advisors if
necessary and on the condition that the family member or advisor similarly does
not disclose these terms to anyone. Employee understands that he or she will be
responsible for any disclosure by a family member or advisor as if he or she had
disclosed it himself or herself. This restriction does not prohibit Employee’s
disclosure of this Release Agreement or its terms to the extent necessary during
a legal action to enforce this Release Agreement or to the extent Employee is
legally compelled to make a disclosure. However, Employee will notify the
Employer promptly upon becoming aware of that legal necessity and provide it
with reasonable details of that legal necessity.   10.        Employee has not
filed or caused to be filed any lawsuit, complaint or charge with respect to any
Claim he releases in this Release Agreement. Employee promises never to file or
pursue a lawsuit, complaint or charge based on any Claim released by this
Release Agreement, except that Employee may participate in an investigation or
proceeding conducted by an agency of the United States Government or of any
state. Employee also has not assigned or transferred any claim he or she is
releasing, nor has he or she purported to do so. [For group termination of
Employees age 40 and over: Employee covenants and agrees not to institute, or
participate in any way in anyone else’s actions involved in instituting, any
action against any of the members of the Decisional Unit with respect to any
Claim released herein.]

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11.        The parties acknowledge that Employee agrees not to apply for
employment in the future with Employer and the Employer shall be under no
obligation to consider any such employment application that the Employee may
tender in violation of this paragraph.   12.        Employee acknowledges and
affirms that Employee has no knowledge of any actions or inactions by Employer
or its affiliates (including but not limited to safety violations) that Employee
believes could possibly constitute the basis for a claimed violation of any
federal, state or local law, any common law, or any rule promulgated by an
administrative body (including but not limited to the Federal Aviation
Administration). Employee further affirms that he or she is not aware of any
action or inaction by Employer that could possibly constitute the basis for a
violation of any safety or other policies of the Employer or its affiliates.  
13.        All Confidential Information and Trade Secrets and all physical
embodiments thereof received or developed by the Employee while employed by the
Employer are confidential to and are and will remain the sole and exclusive
property of the Employer. The Employee will hold such Confidential Information
and Trade Secrets in trust and strictest confidence, and will not use,
reproduce, distribute, disclose or otherwise disseminate the Confidential
Information and Trade Secrets or any physical embodiments thereof and may in no
event take any action causing or fail to take the action necessary in order to
prevent, any Confidential Information and Trade Secrets disclosed to or
developed by the Employee to lose its character or cease to qualify as
Confidential Information or Trade Secrets.            The covenants restricting
the use of Confidential Information will continue and be maintained by the
Employee for a period of two years from the Effective Date. The covenants
restricting the use of Trade Secrets will continue and be maintained by the
Employee for so long as permitted by the governing law.            The Employee
agrees that during the Applicable Period, the Employee will not (except on
behalf of or with the prior written consent of the Employer, which consent may
be withheld in Employer’s sole discretion), either directly or indirectly, on
his or her own behalf, or in the service of or on behalf of others, engage in or
provide managerial services or management consulting services to, any Competing
Business. The Employee acknowledges and agrees that the Business of the Employer
is conducted on a worldwide basis.            The Employee agrees that during
the Applicable Period, he or she will not, either directly or indirectly, on his
or her own behalf or in the service of or on behalf of others solicit, divert or
appropriate, or attempt to solicit, divert or appropriate, to a Competing
Business, any individual or entity which is an actual or, to his or her
knowledge, actively sought prospective client or customer of the Employer or any
of its Affiliates (determined as of date of termination of employment) with whom
he or she had material contact during the two-year period immediately preceding
his or her termination of employment.            The Employee agrees that during
the Applicable Period, he or she will not, either directly or indirectly, on his
or her own behalf or in the service of or on behalf of others, solicit, divert
or hire, or attempt to solicit, divert or hire, or encourage to go to work for
anyone other than the Employer or its Affiliates, any person that is a
management level employee of the Employer or an Affiliate.            In the
event that this Paragraph 13 is determined by a court which has jurisdiction to
be unenforceable in part or in whole, the court shall be deemed to have the
authority to strike any

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    unenforceable provision, or any part thereof or to revise any provision to
the minimum extent necessary to be enforceable to the maximum extent permitted
by law.            The Employee agrees that the covenants, agreements, and
representations contained in this Paragraph 13 are of the essence of this
Release Agreement; that each of such covenants are reasonable and necessary to
protect and preserve the interests and properties of the Employer; that
irreparable loss and damage will be suffered by the Employer should the Employee
breach any of such covenants and agreements; that each of such covenants and
agreements is separate, distinct and severable not only from the other of such
covenants and agreements but also from the other and remaining provisions of
this Release Agreement; that the unenforceability of any such covenant or
agreement shall not affect the validity or enforceability of any other such
covenant or agreements or any other provision or provisions of this Release
Agreement; and that, in addition to other remedies available to it, the Employer
shall be entitled to seek both temporary and permanent injunctions to prevent a
breach or contemplated breach by the Employee of any of such covenants or
agreements and shall be relieved of its obligation to make any and all payments
to the Employee that otherwise are or may become due and payable to the Employee
pursuant to Paragraph 2. The Employer and the Employee agree that all remedies
available to the Employer shall be cumulative.            Whenever used in this
Paragraph 13, the following terms and their variant forms shall have the meaning
set forth below:       “Affiliate” means any person, firm, corporation,
partnership, association or entity that, directly or indirectly or through one
or more intermediaries, controls, is controlled by or is under common control
with the Employer.       “Applicable Period” means, for this Release Agreement
the period commencing with the Effective Date and ending twelve (12) months
thereafter with respect to the Executive’s engagement in or providing of any
managerial services or management consulting services to a Competing Business
and twenty-four (24) months thereafter for all other forms of restrictive
covenants provided for herein (e.g., Confidential Information, solicitation of
customers or employees, etc.).       “Business of the Employer” means the
business of providing long-range passenger and cargo charter and wet lease air
transportation services as a supplemental operations carrier (which shall not
include any scheduled service carrier) holding a certificate of public
convenience and necessity issued by the U.S. Department of Transportation.      
“Competing Business” means any person, firm, corporation, joint venture, or
other business that is engaged in the Business of the Employer.      
“Confidential Information” means data and information relating to the Business
of the Employer or an Affiliate (which does not rise to the status of a Trade
Secret) which is or has been disclosed to the Employee or of which the Employee
became aware as a consequence of or through [his] relationship to the Employer
or an Affiliate and which has value to the Employer or an Affiliate and is not
generally known to its competitors. Confidential Information shall not include
any data or information that has been voluntarily disclosed to the public by the
Employer or an Affiliate (except where such public disclosure has been made by
the Employee without authorization) or that has been independently developed and
disclosed by others, or that otherwise enters the public domain through

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    lawful means without breach of any obligations of confidentiality owed to
the Employer or any of its Affiliates by the Employee.       “Trade Secrets”
means information including, but not limited to, technical or nontechnical data,
formulae, patterns, compilations, programs, devices, methods, techniques,
drawings, processes, financial data, financial plans, product plans or lists of
actual or potential customers or suppliers which (i) derives economic value,
actual or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy.   14.        The
Employer and Employee agree that the terms of this Release Agreement shall be
final and binding and that this Release Agreement shall be interpreted, enforced
and governed under the laws of the State of Georgia. The provisions of this
Release Agreement can be severed, and if any part of this Release Agreement is
found to be unenforceable, the remainder of this Release Agreement will continue
to be valid and effective.   15.        This Release Agreement sets forth the
entire agreement between the Employer and Employee and fully supersedes any and
all prior agreements or understandings, written and/or oral, between the
Employer and Employee pertaining to the subject matter of this Release
Agreement.   16.        Employee is solely responsible for the payment of any
fees incurred as the result of an attorney reviewing this Release Agreement on
behalf of Employee.            Employee’s signature below indicates Employee’s
understanding and agreement with all of the terms in this Release Agreement.    
       Employee should take this Release Agreement home and carefully consider
all of its provisions before signing it. [For Employee age 40 or over or group
termination of Employees age 40 and over: Employee may take up to [twenty-one
(21) days] [forty-five (45) days if group termination] to decide whether
Employee wants to accept and sign this Release Agreement. Also, if Employee
signs this Release Agreement, Employee will then have an additional seven
(7) days in which to revoke Employee’s acceptance of this Release Agreement
after Employee has signed it. This Release Agreement will not be effective or
enforceable, nor will any consideration be paid, until after the seven (7) day
revocation period has expired.] Again, Employee is free and encouraged to
discuss the contents and advisability of signing this Release Agreement with an
attorney of Employee’s choosing.       Employee should read carefully. This
Release Agreement includes a release of all known and unknown claims through the
effective date. Employee is strongly advised to consult with an attorney before
executing this document.            IN WITNESS WHEREOF, Employee and the
Employer have executed this Release Agreement effective as of the date first
written above.

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          EMPLOYEE        
 
       
 
              Signature    
 
              Date Signed    
 
        WORLD AIR HOLDINGS, INC.    
 
       
By: 
       
Title:
 
    

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ATTACHMENT I
[Insert descriptive name of decisional unit from the Release Agreement]
Employees Comprising the “Decisional Unit”

              Job Title:   Age:   Participating:   Not Participating:
 
           

Executive Employment Agreement — Addison

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