Exhibit 10.27

 

 

EMPLOYMENT AGREEMENT

 

AGREEMENT, made and entered into this 27th day of October, 2003, by and between
ARAMARK Corporation, a Delaware corporation (“ARAMARK”), and Joseph Neubauer
(“Mr. Neubauer”) (the “Agreement”).

 

W I T N E S S E T H:

 

WHEREAS, Mr. Neubauer currently serves as Chairman and Chief Executive Officer
of ARAMARK pursuant to the terms of an employment agreement originally dated as
of the 18th day of February, 1983, as amended and restated on             
            ,      1999, and further amended December 14, 2001 (the “Prior
Agreement”); and

 

WHEREAS, ARAMARK and Mr. Neubauer desire to enter into this Agreement, effective
January 1, 2004, which will, except as otherwise set forth herein, supersede the
Prior Agreement and set forth the terms and conditions under which Mr. Neubauer
will serve in an executive capacity hereafter for ARAMARK and is affiliates;

 

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereto hereby agree as follows:

 

1. Employment. ARAMARK hereby employs Mr. Neubauer, and Mr. Neubauer hereby
accepts such employment, as of January 1, 2004, upon the terms and conditions
set forth in this Agreement.

 

2. Position and Duties. During the Term (as hereinafter defined), Mr. Neubauer
(i) agrees to serve as the Executive Chairman of ARAMARK and to perform such
duties in such capacity as may be delineated in the By-Laws of ARAMARK and such
other reasonable duties, consistent with his position as Executive Chairman, as
may be assigned to him from time to time by the Board of Directors of ARAMARK
(the “Board”), (ii) shall report only to the Board, and (iii) shall be given
such authority as is appropriate to carry out the duties described above. During
the Term, ARAMARK shall make its best efforts to ensure Mr. Neubauer’s election
to, and retention as a member of, the Board.

 

3. Exclusive Services. During the Term, and except for illness or incapacity,
Mr. Neubauer shall devote substantially all of his business time, attention,
skill and efforts exclusively to the business and affairs of ARAMARK and its
subsidiaries and affiliates, shall not be engaged in any other business
activity, and shall perform and discharge the duties that may be assigned to him
from time to time by the Board; provided, however, that nothing in this
Agreement shall preclude Mr. Neubauer from devoting time during reasonable
periods required for:

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(i) serving, in accordance with ARAMARK’s policies and with the prior approval
of the Board, as a director or member of a committee of any company or
organization, (it being understood that Mr. Neubauer may continue to serve as a
director or member of boards and committees on which he serves as of the date of
this Agreement);

 

(ii) delivering lectures and fulfilling speaking engagements;

 

(iii) engaging in charitable and community activities;

 

(iv) investing his personal assets in a Passive Investment (as hereinafter
defined) in such form and in such manner as will not violate Section 12 below;
and

 

(v) if, and to the extent, permitted by the Board, conducting other business
activities, in such manner as will not violate Section 12 below.

 

For purposes of this Agreement, a “Passive Investment” shall mean an investment
in a business or entity which does not require Mr. Neubauer to render any
services in the operations or affairs of such business or entity and which does
not materially interfere with the performance of Mr. Neubauer’s duties and
obligations to ARAMARK or any of its subsidiaries or affiliates.

 

4. Relocation. ARAMARK shall not relocate Mr. Neubauer’s principal place of
business outside of Philadelphia, Pennsylvania, without the written consent of
Mr. Neubauer.

 

5. Term of Agreement. The term of this Agreement shall be the period commencing
on January 1, 2004 and ending on the second anniversary of a notice of
termination of the Agreement given by either party unless earlier terminated
pursuant to Section 10 (the “Term”). Upon expiration of the Term pursuant to a
two-year notice given pursuant to this Section 5, Mr. Neubauer shall commence
the consulting services described in Section 9.

 

6. Salary and Annual Bonus.

 

(a) Salary. Mr. Neubauer shall be paid base salary (the “Base Salary”) at the
initial rate of $1,000,000 per annum. The Base Salary shall be payable in
accordance with the customary payroll practices for senior executives of
ARAMARK. The Board shall review the performance of Mr. Neubauer on a periodic
basis and, in its sole discretion, may (but is not required to) increase his
salary payable hereunder. Any such increased salary shall thereafter be Mr.
Neubauer’s Base Salary.

 

(b) Annual Bonus. Mr. Neubauer shall be a participant in the Senior Executive
Annual Performance Bonus Arrangement or any successor plan, in accordance with
and subject to the terms and conditions of such arrangement or as it may
hereafter be amended (the amount payable thereunder, his “Bonus”).

 

7. Stock Options; Stock Ownership; Other Equity Programs.

 

(a) Mr. Neubauer shall be eligible to participate in ARAMARK’s 2001 Equity
Incentive Plan, or any successor plans, or any successor plans, in accordance
with and subject to

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the terms and conditions of such plans or as they may hereafter be amended, so
long as they remain in effect.

 

(b) Mr. Neubauer is vested in his equity credit account in the former Career
Compensation Plan which is now called the Equity Credit Arrangement in
accordance with and subject to the terms and conditions of such Arrangement.
Granting of equity incentives under the plan was discontinued on December 3,
1982. The Arrangement provides for accrual of interest, and payment of those
equity credit awards previously granted under the plan.

 

8. Retirement and Welfare Benefits.

 

(a) During the Term, unless otherwise specified herein, Mr. Neubauer will be
eligible to participate in all retirement and welfare plans, programs and
benefits that are from time to time applicable to senior executives of ARAMARK
at benefit levels applicable from time to time to ARAMARK’s Chief Executive
Officer (including, without limitation, each retirement plan, supplemental and
excess retirement plan, group life insurance, accident and death insurance,
medical and dental insurance, sick leave and disability plan and any other plan
or program providing fringe benefits or perquisites). Mr. Neubauer shall also be
entitled to the same perquisites as the ARAMARK Chief Executive Officer.

 

(b) ARAMARK shall pay Supplemental Retirement Benefits under the terms and
conditions set forth in Exhibit A.

 

9. Consulting Period. In the event of a Voluntary Termination with Notice or an
Involuntary Termination with Notice (as described in Section 10), Mr. Neubauer
shall for a period of two years serve as a consultant to ARAMARK, and shall
render as an independent contractor such consulting and transition services,
consistent with his former position as Executive Chairman, as may be assigned to
him from time to time by the Board. He shall not be required to perform more
than 20 hours of service as a consultant per month. As consideration for such
services, he shall receive the same Base Salary as he was receiving immediately
prior to the end of the Term, and shall continue to be covered by such plans and
arrangements described in Section 8 for which independent contractor consultants
to ARAMARK are eligible, if any. The aggregate Base Salary payable to Mr.
Neubauer under this Section 9 shall be referred to as the “Consulting
Compensation.”

 

10. Termination of Employment.

 

(a) Termination for Cause; Resignation Without Good Reason.

 

(i) ARAMARK may terminate Mr. Neubauer’s employment hereunder for Cause in
accordance with the provisions of Section 10(a)(ii), and the Term shall end on
the date of any such termination. Mr. Neubauer may voluntarily terminate his
employment hereunder without Good Reason. In such event, the Term will end on
the date of any such termination; provided that if such termination occurs at
least two years after Mr. Neubauer’s notice to ARAMARK of his intent to
terminate his employment hereunder without Good Reason, it shall be considered a
“Voluntary Termination with Notice.” In the event Mr. Neubauer’s employment is
terminated by ARAMARK for Cause or Mr. Neubauer resigns from his employment
without Good Reason, Mr. Neubauer shall receive the following amounts:

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(A) Any Base Salary accrued but unpaid, and any accrued vacation as of the
effective date of termination (the “Accrued Amounts”);

 

(B) A prorated Bonus with respect to ARAMARK’s fiscal year in which termination
occurs equal to the average annual Bonus paid or accrued on behalf of Mr.
Neubauer for (i) the fiscal years of ARAMARK that ended in 2001, 2002 and 2003,
or (ii) the three full fiscal years of ARAMARK that precede the year of Mr.
Neubauer’s termination of employment, whichever is greater (his “Average Bonus”)
multiplied by the number of days employed over total days in the year in which
Mr. Neubauer’s employment terminated (a “Pro-Rata Bonus”);

 

(C) Supplemental Retirement Benefits payable pursuant to Exhibit A;

 

(D) All amounts otherwise payable or coverages otherwise afforded pursuant to
the terms of any employee benefit plan maintained by ARAMARK (the “Plan
Amounts”); and

 

(E) Mr. Neubauer may elect to continue at his sole expense the Executive Health
Plan (to the extent Mr. Neubauer and members of his family are eligible for such
benefit and, for this purpose, Mr. Neubauer shall be deemed to be employed by
ARAMARK) for a period not to exceed three years. Equity Credit Arrangement
participation shall be as a terminated employee under the Arrangement.

 

In addition, all of the options and ISPOs held by Mr. Neubauer shall remain
subject to the terms and conditions of the applicable plans, except that, in the
case of a Voluntary Termination with Notice, all of such stock options and ISPOs
shall also become vested and immediately exercisable on the date of termination.

 

(ii) Termination for “Cause” shall mean termination by action of the Board
because of: (A) Mr. Neubauer’s repeated and willful failure to perform his
duties hereunder in any material respect; (B) a felony conviction of Mr.
Neubauer; or (C) any willful misconduct by Mr. Neubauer that is materially
injurious to the financial condition or business reputation of ARAMARK and its
affiliates and subsidiaries taken as a whole, provided, however, that no event
or circumstance shall be considered to constitute Cause within the meaning of
clause (A) or (C) unless Mr. Neubauer has been given written notice of the
events or circumstances constituting Cause and has failed to effect a cure
thereof within 30 calendar days after his receipt of such notice.

 

(iii) Resignation for “Good Reason” shall mean (A) the resignation of Mr.
Neubauer after (x) ARAMARK, without the express written consent of Mr. Neubauer,
materially breaches this Agreement or Mr. Neubauer is not serving on the Board
(other than with the express written consent of Mr. Neubauer); (y) Mr. Neubauer
notifies ARAMARK in writing of the nature of such material breach or failure to
be a member of the Board and (z) ARAMARK does not correct such material breach
or failure within 30 calendar days after its receipt of such notice; or (B)
resignation by Mr. Neubauer within 12 months after a Change of Control (as
defined below in this Section). ARAMARK acknowledges and agrees that a material
breach for purposes of this Section 10 shall include, but not be limited to, any
material reduction in

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Mr. Neubauer’s duties or authority (whether or not accompanied by a change in
title), any diminution in Mr. Neubauer’s title, any failure to pay Mr.
Neubauer’s Base Salary and any relocation of Mr. Neubauer’s principal place of
business outside of Philadelphia, Pennsylvania.

 

(iv) For this purpose, “Change of Control” shall occur if (i) a “person” as
defined in Section 3(a)(9) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), and as used in Sections 13(d) and 14(d) thereof, including
a “group” as defined in Section 13(d) of the Exchange Act but excluding ARAMARK
and any subsidiary and any employee benefit plan sponsored or maintained by
ARAMARK or any subsidiary (including any trustee of such plan acting as
trustee), shall become the beneficial owner, directly or indirectly, of
securities of ARAMARK representing 35% or more of the combined voting power of
ARAMARK’s then outstanding voting securities, (ii) at any time individuals who
within the prior two years constituted the Board (together with any new
directors whose election by the Board or whose nomination for election by
ARAMARK’s shareholders was approved by a vote of the majority of the Directors
then still in office who were either (x) Directors immediately prior to such two
year period or (y) whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Directors then in
office; (iii) there occurs any sale, exchange or other disposition, in one
transaction, or in a series of related transactions, of substantially all of
ARAMARK’s income producing assets or property; (iv) there is consummated any
transaction or series of transactions under which ARAMARK is merged or
consolidated with any other company, other than a merger or consolidation which
results in the shareholders of ARAMARK immediately prior thereto continuing to
own (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 50% of the combined voting power
of the voting securities of ARAMARK or such surviving entity outstanding
immediately after such merger or consolidation; or (v) there occurs a change in
control of a nature that would be required to be reported in reference to Item
1(a) of Current Report on Form 8-K pursuant to Section 13 or 15(d) of the
Exchange Act; provided, however, that no Change of Control shall occur if Mr.
Neubauer is a member of a group (i.e. a “person,” as above defined) whose
transaction with ARAMARK or its shareholders would result in a Change of
Control.

 

(b) Termination Without Cause; Resignation for Good Reason.

 

ARAMARK may terminate Mr. Neubauer’s employment hereunder without Cause, in
which case the Term will end on the date of any such termination; provided that
if such termination occurs at least two years after ARAMARK’s notice to him of
its intent to terminate his employment hereunder without Cause, it shall be
considered an “Involuntary Termination with Notice.” Mr. Neubauer may terminate
his employment hereunder for Good Reason, and the Term shall end upon such
termination of employment.

 

In the event Mr. Neubauer’s employment is terminated by ARAMARK without Cause or
if Mr. Neubauer should resign for Good Reason, Mr. Neubauer shall receive the
following amounts, and ARAMARK shall have no further obligation to Mr. Neubauer
under this Agreement, except as specifically set forth in this Agreement:

 

(i) The Accrued Amounts;

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(ii) In the case of an Involuntary Termination with Notice, the Pro-Rata Bonus;

 

(iii) Except in the case of an Involuntary Termination with Notice, a lump sum
payment equal to two times Mr. Neubauer’s Base Salary, payable within 10
business days after the effective date of termination of employment;

 

(iv) Except in the case of an Involuntary Termination with Notice, a lump sum
payment equal to the Pro-Rata Bonus plus two times Mr. Neubauer’s Average Bonus
payable within 10 business days after the effective date of termination of
employment;

 

(v) Except in the case of an Involuntary Termination with Notice (in which case
the consulting period in Section 9 shall be applicable), a lump sum payment
equal to the Consulting Compensation, payable within 10 business days after
termination of employment;

 

(vi) Supplemental Retirement Benefits shall be payable pursuant to Exhibit A;

 

(vii) Except in the case of an Involuntary Termination with Notice, Survivor
Income Protection Plan, other health and welfare plan participation, and other
perquisites shall continue for three years from the effective date of
termination.

 

(viii) Mr. Neubauer may elect to continue at his sole expense the Executive
Health Plan (to the extent Mr. Neubauer and members of his family are eligible
for such benefit and, for this purpose, Mr. Neubauer shall be deemed to be
employed by ARAMARK) for a period not to exceed three years. Equity Credit
Arrangement participation shall be as a terminated employee under the
Arrangement; and

 

(ix) The Plan Amounts.

 

In addition, all of the options and ISPOs to purchase shares of Stock of ARAMARK
held by Mr. Neubauer shall become vested and immediately exercisable but will in
all respects otherwise remain subject to the terms and conditions of the
applicable plans.

 

(c) No Duty to Mitigate. Anything contained herein to the contrary
notwithstanding, if Mr. Neubauer’s employment terminates for any reason, Mr.
Neubauer shall in no event be required to seek any other employment or take any
other action by way of mitigation or otherwise with respect to the amounts
payable to Mr. Neubauer under this Agreement. In addition, any amounts earned by
Mr. Neubauer, whether from self-employment, as a common law employee or
otherwise, shall not reduce any amounts otherwise payable to him under this
Agreement.

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(d) Death. If Mr. Neubauer’s Employment terminates by reason of Mr. Neubauer’s
death, the Term shall end and Mr. Neubauer’s estate shall receive the following
amounts:

 

(i) The Accrued Amounts;

 

(ii) The Pro-Rata Bonus;

 

(iii) Supplemental Retirement Benefits shall be payable to the extent set forth
in Exhibit A;

 

(iv) Equity Credit Arrangement participation shall be as a terminated employee
under the Arrangement; and

 

(v) The Plan Amounts.

 

Stock options and ISPOs shall be treated in accordance with the terms of the
applicable plans.

 

(e) Permanent Disability. In the event that Mr. Neubauer is unable to perform
his duties hereunder by reason of illness or incapacity for a continuous period
of more than six (6) months, or for an aggregate of more than eight (8) months
in any twelve (12) month period, ARAMARK shall have the right to terminate Mr.
Neubauer’s employment by reason of disability (“Permanent Disability”). If
ARAMARK terminates Mr. Neubauer’s employment pursuant to this Section 10(e), the
Term shall end and Mr. Neubauer shall receive the following amounts:

 

(i) The Accrued Amounts;

 

(ii) Base Salary shall continue for a period of three years from the effective
date of termination, offset by any payments due to Mr. Neubauer pursuant to the
Survivor Income Protection Plan and all other disability income protection plans
of ARAMARK;

 

(iii) The Pro-Rata Bonus;

 

(iv) Supplemental Retirement Benefits shall be payable pursuant to Exhibit A;

 

(v) Equity Credit Arrangement participation shall be as a terminated employee
under the Arrangement; and

 

(vi) The Plan Amounts.

 

In addition, all of the stock options and ISPOs held by Mr. Neubauer shall
become vested and immediately exercisable but will in all respects otherwise
remain subject to the terms and conditions of the applicable plans. Mr. Neubauer
may elect to continue at his sole expense any or all of the benefits provided by
the Executive Health Plan (to the extent Mr. Neubauer and members of his family
are eligible for such benefit and, for this purpose, Mr. Neubauer shall be
deemed to be employed by ARAMARK) for a period not to exceed three years.

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11. Trade Secrets. ARAMARK may, pursuant to Mr. Neubauer’s employment hereunder,
provide and confide to Mr. Neubauer business methods and systems (“Systems”),
techniques and methods of operation developed at great expense by ARAMARK and
which Mr. Neubauer recognizes to be unique assets of ARAMARK’s business. Mr.
Neubauer shall not, ever, during or after the Term, directly or indirectly, in
any manner utilize or disclose to any person, firm, corporation, association or
other entity, except to directors, consultants, lawyers, auditors, advisors,
agents or employees of ARAMARK in the course of his duties or where required by
law: (i) any such Systems, techniques and methods of operation, or (ii) any
sales prospects, customer lists, products, research or data of any kind, or
(iii) any information relating to strategic plans, sales costs, profits or the
financial condition of ARAMARK or any of its customers or prospective customers,
which are not generally known to the public or recognized as standard practice
in the industries in which ARAMARK shall be engaged.

 

12. Non-Competition Agreement.

 

(a) Subject to the geographic limitation of Section 12(b), Mr. Neubauer, for a
period commencing on the date hereof and ending two (2) years following (i) if
there is no consulting period pursuant to Section 9, the end of the Term and
(ii) if there is such a consulting period, the end of such consulting period
pursuant to Section 9, shall not, without ARAMARK’s written permission, directly
or indirectly, on his behalf or on behalf of any other person, firm,
corporation, association or other entity, engage in, or in any way be concerned
with or negotiate for, or acquire or maintain any ownership interest in any
business or activity which is the same, similar to or competitive with that
conducted by, engaged in or developed for later implementation by ARAMARK at any
time during the Term of this Agreement and any subsequent consulting period;
provided that the provision of this Section 12 shall not be deemed breached
merely because Mr. Neubauer owns not more than 1% of the outstanding stock of a
corporation, if, at the time of its acquisition by Mr. Neubauer, such stock is
listed on a national securities exchange or quoted on an inter-dealer quotation
system and provided further that Mr. Neubauer shall not be required to cease any
activity that did not violate this Agreement (or any predecessor agreement) when
such activity commenced.

 

(b) Mr. Neubauer acknowledges that ARAMARK is engaged in business in each of the
50 states and several foreign countries and that ARAMARK intends to expand the
geographic scope of its activities. Accordingly and in view of the nature of his
position and responsibilities, Mr. Neubauer agrees that the provisions of
Section 12(a) shall be applicable to all 50 states and, addition, to each
foreign country, possession or territory in which ARAMARK (as defined in Section
16) may be engaged in business from time to time during the Term and as of the
expiration of the Term and any subsequent consulting period.

 

(c) Mr. Neubauer agrees that for a period of two (2) years following (i) if
there is no consulting period pursuant to Section 9, the end of the Term and
(ii) if there is such a consulting period, the end of such consulting period, he
will not, directly or indirectly, at any time in any manner, induce or attempt
to influence any employees of ARAMARK to terminate their employment with
ARAMARK.

 

(d) As used in Sections 11 and 12 of this Agreement, “ARAMARK” shall be deemed
to include any entity twenty percent (20%) of the equity of which during the
period for which he is receiving payments under this Agreement and during any
subsequent consulting period, is directly or indirectly owned by ARAMARK.

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13. Equitable Remedies. Mr. Neubauer acknowledges that, in the event of any
violation by Mr. Neubauer of the provisions of Sections 11 or 12 of this
Agreement, ARAMARK will sustain serious, irreparable and substantial harm to its
business, the extent of which will be difficult to determine and impossible to
remedy by an action at law for money damages. Accordingly, Mr. Neubauer agrees
that, in the event of such violation or threatened violation by Mr. Neubauer,
ARAMARK shall be entitled to an injunction before trial from any court of
competent jurisdiction as a matter of course and upon the posting of not more
than a nominal bond in addition to all such other legal and equitable remedies
as may be available to ARAMARK. Mr. Neubauer further agrees that, in the event
any of the provisions of Sections 11 and 12 of this Agreement are determined by
a court of competent jurisdiction to be contrary to any applicable statute, law
or rule, or for any reason to be unenforceable as written, such court may modify
any of such provisions so as to permit enforcement thereof as thus modified.

 

14. Deferred Compensation. Mr. Neubauer has entered into a series of deferred
compensation agreements with ARAMARK. Such agreements shall remain in full force
and effect, and shall not be affected by ARAMARK and Mr. Neubauer entering into
this Agreement.

 

15. Additional Provisions. The provisions of Exhibit B are part of this
Agreement.

 

16. Substitution of Benefits. If any of the items of compensation, bonus or
perquisites provided for in this Agreement shall hereafter be prohibited by
governmental regulations, corporate law, ARAMARK policies or ARAMARK plans,
payment or benefit of equivalent value shall be substituted by ARAMARK.

 

17. Entire Agreement. This Agreement (with the exhibits hereto and agreements
referred to in Sections 7 and 14), on and after January 1, 2004, shall
constitute the full and complete understanding and agreement of Mr. Neubauer and
ARAMARK respecting the subject matter hereof, and supersedes all prior
understandings and agreements, oral or written, express or implied. The
Registration Rights Agreement among ARAMARK Worldwide Corporation, Mr. Neubauer
and certain other shareholders dated December 14, 2001, shall be unaffected by
this Agreement. This Agreement may not be modified or amended orally, but only
by agreement in writing, signed by the party against whom enforcement of any
waiver, change, modification, extension or discharge is sought.

 

18. Notices. All notices and other communications hereunder will be in writing
and will be given by hand delivery to the other party or by next-day delivery
service or registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

 

If to Mr. Neubauer:

 

210 West Rittenhouse Square

#3106

Philadelphia, PA 19103

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If to ARAMARK:

 

ARAMARK Corporation

1101 Market Street

Philadelphia, PA 19107

Attn.: Corporate Secretary

 

or to such other address as either party will have furnished to the other in
writing. All notices and communications shall be deemed to have been duly given
and received: (a) on the date of receipt, if delivered by hand; (b) three (3)
business days after being sent by first class certified mail, return receipt
requested, postage prepaid; or (c) one (1) business day after sending by
next-day delivery service with confirmation of receipt. As used herein, the term
“business day” means any day that is not Saturday, Sunday or legal holiday in
the State of Pennsylvania.

 

19. Waiver of Breach. No waiver by either party of any condition or of the
breach by the other of any term or covenant contained in this Agreement, whether
by conduct or otherwise, in any one or more instances shall be deemed or
construed as a further or continuing waiver of any such condition or breach or a
waiver of any other condition, or of the breach of any other term or covenant
set forth in this Agreement. Moreover, the failure of either party to exercise
any right hereunder shall not bar the later exercise thereof.

 

20. Assignment. This Agreement shall inure to the benefit of and be binding on
the parties and their respective successors in interest, and shall not be
assignable by either party without the written consent of the other. ARAMARK
will require any successor in interest to all or substantially all of ARAMARK
(whether direct or indirect, by purchase, merger, or consolidation or otherwise)
to expressly assume this Agreement, but ARAMARK shall remain liable if such
successor in interest shall default on any of its obligations hereunder.

 

21. Governing Law. This Agreement is entered into and shall be construed in
accordance with the laws of the Commonwealth of Pennsylvania.

 

22. Continuation of Covenants. The covenants and agreements of Mr. Neubauer set
forth in Sections 11 through 13 shall survive termination of employment, shall
continue thereafter, and shall not expire unless and except as may be expressly
set forth in said Sections.

 

23. Invalidity or Unenforceability. If any term or provision of this Agreement
is held to be invalid or unenforceable, for any reason, such invalidity or
unenforceability shall not affect any other term or provision hereof and this
Agreement shall continue in full force and effect as if such invalid or
unenforceable term or provision (to the extent of the invalidity or
unenforceability) had not been contained herein.

 

24. Arbitration. Except as provided in Section 13, any controversy or claim
arising out of or relating to this Agreement, or the breach hereof, shall be
settled by arbitration in Philadelphia, Pennsylvania, before one arbitrator in
accordance with rules then in effect of the American Arbitration Association.
ARAMARK shall pay Mr. Neubauer’s legal expenses should Mr. Neubauer prevail on
any substantial issue.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written.

 

 

MR. NEUBAUER

/S/    JOSEPH NEUBAUER

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Joseph Neubauer

ARAMARK CORPORATION

BY:/S/    JAMES E. PRESTON

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Exhibit A

 

1.   The annual Supplemental Retirement Benefits (“SRB”), payable in
substantially equal monthly installments, shall equal the sum of: 50% of Mr.
Neubauer’s Base Salary, plus 50% of an amount equal to one times Mr. Neubauer’s
Average Bonus minus the benefit payable from the Survivor Income Protection
Plan.

 

2.   Unless otherwise provided below the SRB shall commence on the first day of
the month following the expiration of the Term.

 

3.   In all events the SRB shall terminate upon Mr. Neubauer’s death, provided
that one-half of the SRB amount that would otherwise be payable to Mr. Neubauer
shall continue to be paid to Mr. Neubauer’s then surviving spouse, if any, for
her lifetime, provided that the surviving spouse benefit described in this item
3 shall only apply to the individual who is Mr. Neubauer’s spouse at the time of
his termination of employment hereunder.

 

4.   In the event of termination of Mr. Neubauer’s employment due to Permanent
Disability, payments shall commence upon the earlier of Mr. Neubauer’s
attainment of age 65 or expiration of Mr. Neubauer’s eligibility to receive
Company Long Term Disability Plan (or any successor plan) benefits.

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Exhibit B

 

Excise Tax Gross Up

 

(a) In the event that any payment or benefit received or to be received by Mr.
Neubauer pursuant to the terms of this Agreement or otherwise from ARAMARK or
any affiliate (the “Payments”) would be subject to the excise tax (the “Excise
Tax”) imposed by Section 4999 of the Code, as determined as provided below,
ARAMARK shall pay to Mr. Neubauer, at the time specified in (b) below, an
additional amount (the “Gross-Up Payment”) such that the net amount retained by
Mr. Neubauer, after deduction of the Excise Tax on the Payments and any federal,
state and local income or other tax and Excise Tax upon the payment provided for
by this Section (a), and any interest, penalties or additions to tax payable by
Mr. Neubauer with respect thereto, shall be equal to the value of the Payments
at the time such Payments are to be made as if the Excise Tax imposed by Section
4999 did not apply. For purposes of determining whether any of the Payments will
be subject to the Excise Tax and the amounts of such Excise Tax, (1) the total
amount of the Payments shall be treated as “parachute payments” within the
meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments”
within the meaning of Section 280G(b)(1) of the Code shall be treated as subject
to the Excise Tax, except to the extent that, in the opinion of independent tax
counsel selected by ARAMARK’s independent auditors and reasonably acceptable to
Mr. Neubauer (“Tax Counsel”), a Payment (in whole or in part) does not
constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the
Code, or such “excess parachute payments” (in whole or in part) are not subject
to the Excise Tax, (2) the amount of the Payments that shall be treated as
subject to the Excise Tax shall be equal to the lesser of (A) the total amount
of the Payments or (B) the amount of “excess parachute payments” within the
meaning of Section 280G(b)(1) of the Code (after applying clause (1) hereof),
and (3) the value of any noncash benefits or any deferred payment or benefit
shall be determined by Tax Counsel in accordance with the principles of Sections
280G(d)(3) and (4) of the Code. For purposes of determining the amount of the
Gross-Up Payment, Mr. Neubauer shall be deemed to pay federal income tax at the
highest marginal rates of federal income taxation applicable to individuals in
the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest effective rates of taxation applicable to
individuals as are in effect in the state and locality of Mr. Neubauer’s
residence or place of employment in the calendar year in which the Gross-Up
Payment is to be made, net of the maximum reduction in federal income taxes that
can be obtained from deduction of such state and local taxes, taking into
account any limitations applicable to individuals subject to federal income tax
at the highest marginal rates.

 

(b) The Gross-Up Payments provided for in Section (a) hereof shall be made upon
the imposition upon Mr. Neubauer or payment by Mr. Neubauer of any Excise Tax.

 

(c) Mr. Neubauer shall notify ARAMARK in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by ARAMARK of a
Gross-Up Payment. Such notification shall be given as soon as practicable but no
later than 10 business days after Mr. Neubauer is informed in writing of such
claim and shall apprise ARAMARK of the nature of such claim and the date on
which such claim is requested to be paid. Mr. Neubauer shall not pay such claim
prior to the expiration of the 30 day period following the date on which Mr.
Neubauer gives such notice to ARAMARK (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If

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ARAMARK notifies Mr. Neubauer in writing prior to the expiration of such period
that it desires to contest such claim, Mr. Neubauer shall:

 

i. give ARAMARK any information reasonably requested by ARAMARK relating to such
claim;

 

ii. take such action in connection with contesting such claim as ARAMARK 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 ARAMARK and reasonably satisfactory to Mr. Neubauer;

 

iii. cooperate with ARAMARK in good faith in order to effectively contest such
claim; and

 

iv. permit ARAMARK to participate in any proceedings relating to such claim;

 

provided, however, that ARAMARK shall bear and pay directly all costs and
expenses (including, but not limited to, additional interest and penalties and
related legal, consulting or other similar fees) incurred in connection with
such contest and shall indemnify and hold Mr. Neubauer harmless, on an after-tax
basis, for any Excise Tax or other tax (including interest and penalties with
respect thereto) imposed as a result of such representation and payment of costs
and expenses.

 

(d) ARAMARK shall control all proceedings taken in connection with such contest
and, at its sole option, may pursue or forego 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 Mr. Neubauer to
pay the tax claimed and sue for a refund or contest the claim in any permissible
manner, and Mr. Neubauer 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 ARAMARK shall determine; provided, however,
that if ARAMARK directs Mr. Neubauer to pay such claim and sue for a refund,
ARAMARK shall advance the amount of such payment to Mr. Neubauer on an
interest-free basis, and shall indemnify and hold Mr. Neubauer harmless, on an
after-tax basis, from any Excise Tax or other 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 provided,
further, that if Mr. Neubauer is required to extend the statute of limitations
to enable ARAMARK to contest such claim, Mr. Neubauer may limit this extension
solely to such contested amount. ARAMARK’s control of the contest shall be
limited to issues with respect to which a Gross-Up Payment would be payable
hereunder and Mr. Neubauer shall be entitled to settle or contest, as the case
may be, any other issue raised by the Internal Revenue Service or any other
taxing authority. In addition, no position may be taken nor any final resolution
be agreed to by ARAMARK without Mr. Neubauer’s consent if such position or
resolution could reasonably be expected to adversely affect Mr. Neubauer
(including any other tax position of Mr. Neubauer unrelated to the matters
covered hereby).

 

(e) As a result of the uncertainty in the application of Section 4999 of the
Code at the time of the initial determination by ARAMARK or the Tax Counsel
hereunder, it is possible that Gross-Up Payments which will not have been made
by ARAMARK should have been made (“Underpayment”), consistent with the
calculations required to be made hereunder.

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In the event that ARAMARK exhausts its remedies and Mr. Neubauer thereafter is
required to pay to the Internal Revenue Service an additional amount in respect
of any Excise Tax, the Tax Counsel shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall promptly be paid
by ARAMARK to or for the benefit of Mr. Neubauer.

 

(f) If, after the receipt by Mr. Neubauer of the Gross-Up Payment or an amount
advanced by ARAMARK in connection with the contest of an Excise Tax claim, Mr.
Neubauer receives any refund with respect to such claim, Mr. Neubauer shall
promptly pay to ARAMARK the amount of such refund (together with any interest
paid or credited thereon after taxes applicable thereto). If, after the receipt
by Mr. Neubauer of an amount advanced by ARAMARK in connection with an Excise
Tax claim, a determination is made that Mr. Neubauer shall not be entitled to
any refund with respect to such claim and ARAMARK does not notify Mr. Neubauer
in writing of its intent to contest the denial of such refund prior to the
expiration of 30 days after such determination, such advance shall be forgiven
and shall not be required to be repaid.