Source: http://corpdocs.gmianalyst.com/contracts/ceo_111869.htm
Timestamp: 2017-08-18 10:50:50
Document Index: 683005897

Matched Legal Cases: ['§ 621', '§ 2000', '§ 12101', '§ 1001', '§ 201', '§ 2601', '§ 1981', '§1']

Seperation Agreement For Raymond
Employment Agreement For Fraser
EX-10.12 20 dex1012.htm EMPLOYMENT AGREEMENT DATED AS OF JULY 7, 2004 - CHARLES G. RAYMOND
This Employment Agreement (the “Agreement”) dated as of July 7, 2004, (the “Effective Date”) is made by and between Horizon Lines, LLC, a Delaware limited liability company (together with any successor thereto, the “Company”) and Charles Raymond (the “Executive”).
It is the desire of the Company to assure itself of the services of the Executive by engaging the Executive to perform services under the terms hereof.
The Executive desires to provide services to the Company on the terms herein provided.
NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows:
“Annual Base Salary” shall have the meaning set forth in Section 3(a).
“Annual Bonus Payment Date” shall have the meaning set forth in Section 5(c)(ii).
“Board” shall mean the Board of Directors of the Company or of H-Lines.
The Company shall have “Cause” to terminate the Executive’s employment hereunder upon:
the Executive’s willful and continued failure to attempt in good faith (other than as a result of incapacity due to mental or physical impairment) to substantially perform the duties listed in Section 2(c) which is not remedied within 30 days after receipt of written notice from the Board specifying such failure;
the Executive’s failure to attempt in good faith to carry out, or comply with, in any material respect any lawful and reasonable directive of the Board consistent with the terms of this Agreement, which is not remedied within 30 days after receipt of written notice from the Board specifying such failure;
a material breach by the Executive of the Company’s code of ethics, which is not remedied within 30 days after receipt of written notice from the Board specifying such failure;
the Executive’s conviction, plea of no contest or plea of nolo contendere, or imposition of unadjudicated probation for any felony (other than a
traffic violation or arising purely as a result of the Executive’s title or position with the Company);
the Executive’s knowing unlawful use (including being under the influence) or possession of illegal drugs; or
the Executive’s commission of a material bad faith act of fraud, embezzlement, misappropriation, willful misconduct, gross negligence, or breach of fiduciary duty, in each case against the Company.
For the purposes of this “Cause” definition, no act (or omission) that is (i) taken in good faith and (ii) not adverse to the best interests of the Company shall be considered to be willful.
“Company” shall have the meaning set forth in the preamble hereto. The term “Company “ when used herein in the context of determinations or directions by the Company shall be construed to refer to the Board, a duly authorized committee of the Board or a designee of the Board (the “Designee”).
“Date of Termination” shall mean (i) if the Executive’s employment is terminated by his death, the date of his death; (ii) if the Executive’s employment is terminated pursuant to Section 4(a)(ii) – (vi) either the date indicated in the Notice of Termination or the date specified by the Company pursuant to Section 4(b), whichever is earlier; (iii) if the Executive’s employment is terminated pursuant to Section 4(a)(vii) or Section 4(a)(viii), the expiration of the then-applicable Term.
“Disability” shall mean the Executive’s failure to perform, with or without reasonable accommodation, his material duties for a period of six consecutive months as a result of incapacity due to mental or physical impairment or accident.
“Effective Date” shall have the meaning set forth in the preamble hereto.
“Executive” shall have the meaning set forth in the preamble hereto.
“Executive Bonus Plan” shall mean the bonus plan developed by the Compensation Committee and the Executive. The Executive Bonus Plan shall be attached hereto as Exhibit A.
(i) The Executive shall have “Good Reason” to resign his employment upon the occurrence of any of the following, without the Executive’s written consent:
failure of the Company to continue the Executive in the position of Chief Executive Officer and President of the Company with such
title or, in the event that any parent company of the Company becomes a “reporting company” within the meaning of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (a “Reporting Company”), to appoint and continue the Executive in the position of Chief Executive Officer and President of such parent company;
a material diminution in the nature or scope of the Executive’s responsibilities, duties or authority as set forth in Section 2(c);
relocation of the Executive’s principal office by more than 35 miles;
failure of the Company to make any payment or provide any benefit under this Agreement when such payment or benefit is due;
failure of any Permissible Assignee (in accordance with Section 10) to assume the Agreement in writing; or
the Company’s material breach of this Agreement.
The Executive may not resign his employment for Good Reason unless:
the Executive provides the Company with at least 30 days prior written notice of his intent to resign for Good Reason; and
the Company does not remedy the alleged violation(s) within the 30-day period.
“H-Lines” shall mean H-Lines Holding Corp., a Delaware corporation.
“Initial Annual Base Salary” shall have the meaning set forth in Section 3(a).
“Initial Stub Period” shall have the meaning set forth in Section 5(c)(iii).
“Inventions” shall have the meaning set forth in Section 8.
“Non-Compete Period” shall have the meaning set forth in Section 6(a).
“Notice of Termination” shall have the meaning set forth in Section 4(b).
“Permissible Assignee” shall have the meaning set forth in Section 10.
“Related Agreements” shall have the meaning set forth in Section 15.
“Reporting Company” shall have the meaning set forth in the definition of “Good Reason” contained in this Section 1.
“Restricted Stock” shall have the meaning set forth in Section 3(c).
“Severance Amount” shall have the meaning set forth in Section 5(c)(i).
“Severance Bonus Amount” shall mean the product of (x) the Target Bonus Percentage at the Date of Termination, (y) the Annual Base Salary at the Date of Termination, and (z) the Company factor corresponding to the Company’s performance in relation to the performance targets set forth in the Executive Bonus Plan (such percentage to be determined on a Company-wide basis in good faith by the Compensation Committee) during the fiscal year in which the Executive is terminated. (If the Company factor is zero, the Severance Bonus Amount will be zero.)
“Severance Period” shall have the meaning set forth in Section 5(c)(i).
“Target Bonus Percentage” shall have the meaning set forth in Section 3(b).
“Term” shall have the meaning set forth in Section 2(b).
The Company shall employ the Executive and the Executive shall enter the employ of the Company, for the period set forth in Section 2(b), in the position set forth in Section 2(c), and upon the other terms and conditions herein provided.
The initial term of employment under this Agreement (the “Initial Term”) shall be for the period beginning on the Effective Date and ending on the third anniversary thereof, unless earlier terminated as provided in Section 4. The employment term hereunder shall automatically be extended for successive one-year periods (such extension terms collectively with the Initial Term, the “Term”) unless either party gives notice of non-extension to the other no later than 30 days prior to the expiration of the then-applicable Term.
Position and Duties. The Executive shall serve as Chairman of the Board, Chief Executive Officer and President of the Company and Chief Executive Officer and President of H-Lines (and, in the event that any parent company of the Company becomes a Reporting Company, Chief Executive Officer and President of such parent company), with such responsibilities, duties and authority as is customary for his position and such other duties as may from time to time be assigned to the Executive by the Board, commensurate with his position. The Executive shall report to the Board. The Executive shall devote substantially all his working time and efforts to the business and affairs of the Company. During the Term, it shall not be a violation of this Agreement for the Executive to (i) serve on industry trade, civic or charitable boards or committees; (ii) deliver lectures or fulfill speaking engagements; (iii) manage personal investments, as long as such activities do not interfere with the performance of the Executive’s duties and responsibilities as an employee of the Company; and, with the consent of the Board, serve on boards of other public companies. During his employment and during the Severance Period, the Executive, on the one hand, and the directors and officers of the Company, on the other hand, shall not disparage in any material
respect the other, either orally or in writing. The foregoing shall not limit a party from truthful testimony in response to a subpoena or governmental inquiry or from commencing an action to enforce their rights in a legal action.
Compensation and Related Matters.
Annual Base Salary. During the Term, the Executive shall receive a base salary at a rate of $500,000 per annum (the “Initial Annual Base Salary”), which shall be paid in accordance with the customary payroll practices of the Company, subject to increase as determined by the Compensation Committee (the Initial Annual Base Salary together with any increase, the “Annual Base Salary”). Notwithstanding the foregoing, the Initial Annual Base Salary shall increase to $550,000 unless, as of July 1, 2004, the Company has not achieved the performance target established by the Board in consultation with the Executive with respect to the period ending on such date. Furthermore, the Annual Base Salary shall be increased to $575,000, effective January 1, 2005, unless, as of January 1, 2005, the Company has not achieved the performance target established by the Board in consultation with the Executive for the 2004 fiscal year. If either such target is not met, the Company shall provide the Executive with written notice to that effect within a reasonable period of time (but in no event more than 45 days) the date of such scheduled increase. The Executive’s Annual Base Salary may not be decreased except in connection with a Company wide decrease of salaries and compensation for executives of the Company, and in such instance, the decrease may not exceed 10% of the Executive’s Annual Base Salary nor may the decrease cause the Annual Base Salary to be less than the Executive’s Initial Annual Base Salary.
Annual Bonus. During the Term, the Executive shall be eligible to receive a discretionary bonus, which bonus shall have a target value of not less than 55% of his Annual Base Salary (such target value percentage, as in effect from time to time, the “Target Bonus Percentage”), if the Compensation Committee concludes that the Executive satisfied the performance targets and other criteria set forth in the Executive Bonus Plan.
Restricted Stock. The Executive shall purchase 43,038 shares of common stock of H-Lines, at an aggregate price equal to $344,304 (“Restricted Stock”). The Restricted Stock shall be governed by the terms of the restricted stock agreement as approved by the Compensation Committee which shall provide that (i) with respect to 40% of the Restricted Shares, one-third shall vest on each of the first, second and third anniversaries of the Effective Date and (ii) the remaining 60% shall vest subject to achieving the IRR Target pursuant to the restricted stock agreement over the three year period described in the restricted stock agreement. The Restricted Stock shall also be governed by the terms of the applicable stockholders agreement and voting trust agreement.
Benefits. During the Term, the Executive shall be entitled to participate in employee benefit plans, programs and arrangements of the Company now (or, to
the extent determined by the Board, hereafter) in effect which are applicable to the senior officers of the Company.
Vacation. During the Term, the Executive shall be entitled to vacation each calendar year in accordance with the Company’s policies. Any vacation shall be taken at the reasonable and mutual convenience of the Company and the Executive.
Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by the Executive in the performance of the Executive’s duties to the Company during the Term, in accordance with the Company’s expense reimbursement policy. The Company shall reimburse the Executive for reasonable travel expenses incurred by the Executive’s spouse while traveling with the Executive for business purposes during the Term, provided that the Executive provides the Board with a quarterly report showing the expenses incurred by the Executive’s spouse on such business travel.
Automobile. The Company recognizes the Executive’s need for an automobile for business purposes. During the Term, the Executive shall be entitled to receive an annual automobile allowance of $9,000 and automobile insurance with annual premiums of up to $1,000, subject to appropriate upward adjustments as determined by the Company.
Country Club Dues. During the Term, the Executive shall be entitled to reimbursement for the payment of reasonable monthly membership dues at the Quail Hollow Country Club and Diamond Creek and for any reasonable capital assessments that may be levied.
Luncheon Club. During the Term, the Executive shall be reimbursed for monthly dues or membership fees for the Charlotte City Club.
Physical Examination Reimbursement. During the Term, the Executive shall be entitled to an annual physical examination conducted at the Greenbrier Clinic or by a licensed physician.
Life Insurance. During the Term, the Company shall provide the Executive with a term life insurance policy that pays a beneficiary up to $850,000 upon the death of the Executive.
Key Person Insurance. At any time during the Term, the Company shall have the right to insure the life of the Executive for the Company’s sole benefit. The Company shall have the right to determine the amount of insurance and the type of policy. The Executive shall reasonably cooperate with the Company in obtaining such insurance by submitting to physical examinations, by supplying all information reasonably required by any insurance carrier, and by executing all necessary documents reasonably required by any insurance carrier. The Executive shall incur no financial obligation by executing any required document, and shall have no interest in any such policy.
Roll-Over Options. The Executive shall have the right and option (but not the obligation), not earlier than four (4) years and six (6) months after the Effective Date and so long as the Executive’s employment has not been terminated for Cause, to require the Company, subject to the provisions of this Section 3(m), to purchase shares of common stock of H-Lines acquired by the Executive through the exercise of Roll-Over Options (as defined in the Agreement and Plan of Merger, dated as of May 22, 2004, by and among H-Lines Holding Corp., Horizon Lines Holding Corp., H-Lines Subcorp., and TC Group, L.L.C., as amended or modified). The purchase price for such shares shall be equal to the “Fair Market Value” per share of common stock as defined herein. Notwithstanding any provision contained herein to the contrary, the Company shall not be required to purchase any shares pursuant to the terms of this Section 3(m) if the purchase of such shares would violate or cause the Company to violate or result in the violation or cause the breach of, any covenant contained in the Company’s financing agreements or indentures; provided, that the Company shall use its commercially reasonable efforts to seek a waiver of any such violation or breach, but in no event shall the Company be required to pay any fees or such other consideration in excess of $250,000 in the aggregate for any and all such waiver requests. For the purposes of this Section 3(m), “Fair Market Value” means (i) the product of (A) six (6) multiplied by (B) EBITDA (as defined below) for H-Lines and its consolidated subsidiaries for the four most recent complete fiscal quarters prior to such date (such four fiscal quarters, the “Applicable Valuation Period”) as reported in the consolidated financial statements of H-Lines and its subsidiaries, plus (ii) average cash and cash equivalents of H-Lines and its consolidated subsidiaries for the Applicable Valuation Period (excluding restricted cash or cash equivalents, which, for purposes of clarification, shall include cash or cash equivalents held in escrow, cash committed for capital expenditures, and amounts pursuant to any capital construction fund agreements), minus (iii) the outstanding amount of all term and/or fixed indebtedness (including any obligation owed in respect of capitalized leases) of H-Lines and its consolidated subsidiaries (including the current and long term portions thereof) and accrued interest thereon for the Applicable Valuation Period, minus (iv) revolving credit indebtedness of H-Lines and its consolidated subsidiaries and accrued interest thereon for the Applicable Valuation Period. “EBITDA” shall mean, for any period, earnings before any of the following to the extent included in the computing of such earnings: interest, income taxes, depreciation and amortization, calculated in accordance with generally accepted accounting principles in a manner consistent with past practices; provided, however, that the Board of Directors of H-Lines may exclude any items of gain or loss that are reasonably determined to be extraordinary by the Board of Directors of H-Lines, in its discretion.
Attorney’s Fees. The Company shall promptly after the Effective Date pay the reasonable fees and expenses of the Executive’s counsel in entering into this Agreement, up to a maximum amount of $25,000.
The Executive’s employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:
Death. The Executive’s employment hereunder shall terminate upon his death.
Disability. If the Executive has incurred a Disability, the Company may give the Executive written notice of its intention to terminate the Executive’s employment. In that event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties.
Termination for Cause. The Company may terminate the Executive’s employment for Cause.
Termination without Cause. The Company may terminate the Executive’s employment without Cause.
Resignation for Good Reason. The Executive may resign his employment for Good Reason.
Resignation without Good Reason. The Executive may resign his employment without Good Reason.
Non-extension of Term by the Company. The Company may give notice of non-extension to the Executive pursuant to Section 2(b).
Non-extension of Term by the Executive. The Executive may give notice of non-extension to the Company pursuant to Section 2(b).
Notice of Termination. Any termination of the Executive’s employment by the Company or by the Executive under this Section 4 (other than termination pursuant to paragraph (a)(i)) shall be communicated by a written notice to the other party hereto indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and specifying a Date of Termination which, if submitted by the Executive, shall be at least 30 days following the date of such notice (a “Notice of Termination”) provided, however, that the Company may, in its sole discretion, change the Date of Termination to any earlier date following its receipt of the Notice of Termination. A Notice of Termination submitted by the
Company may provide for a Date of Termination on the date the Executive receives the Notice of Termination, or any date thereafter elected by the Company in its sole discretion that is not later than 90 days from the date the Executive receives the Notice of Termination. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Cause or Good Reason shall not waive any right of the Executive or the Company hereunder or preclude the Executive or the Company from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
Company Obligations upon Termination. Upon termination of the Executive’s employment, the Executive (or the Executive’s estate) shall be entitled to receive (i) the sum of the Executive’s Annual Base Salary through the Date of Termination not theretofore paid, (ii) any expenses, owed to the Executive under Section 3(f) incurred to the Date of Termination and any expenses incurred after the Date of Termination, if such post-termination expenses are approved by the Designee, (iii) any accrued vacation pay owed to the Executive pursuant to Section 3(e), and (iv) any amount arising, from the Executive’s participation in, or benefits under any employee benefit plans, programs or arrangements under Section 3(d), which amounts shall be payable in accordance with the terms and conditions of such employee benefit plans, programs or arrangements, as well as any accrued but unpaid Annual Bonus for any prior fiscal year. The Executive shall also be entitled to the rights set forth in Section 21.
In addition to any amounts to be paid under Section 4(c), the Executive shall receive the amounts and benefits set forth in Sections 5(a), (b) or (c), as applicable:
Termination upon Death. If the Executive’s employment shall terminate as a result of the Executive’s death pursuant to Section 4(a)(i), the Company shall pay to the Executive’s estate a pro-rated bonus calculated and paid in accordance with the terms of the Executive Bonus Plan as in effect at the Date of Termination, in an amount equal to the product of (x) a fraction equal to the number of months in the fiscal year in which the Executive’s employment termination occurs prior to the Date of Termination over 12 and (y) the Severance Bonus Amount (the “Pro Rata Bonus”).
Termination upon Disability. If the Executive’s employment shall terminate as a result of the Executive’s Disability pursuant to Section 4(a)(ii), the Company shall pay to the Executive:
in accordance with the Company’s regular payroll practice following the Date of Termination, an amount equal to the Annual Base Salary that the Executive would have been entitled to receive if the Executive had continued his employment for a period of six (6) months following the Date of Termination; and
in accordance with the terms of the Executive Bonus Plan, the Pro Rata Bonus.
Termination without Cause, by Reason of Non-Extension of Term by the Company, or Resignation for Good Reason. If the Executive’s employment shall terminate without Cause pursuant to Section 4(a)(iv), by notice of non-extension by the Company pursuant to Section 4(a)(vii), or for Good Reason pursuant to Section 4(a)(v), the Company shall, after execution, without revocation, of a binding general waiver and release of claims by the Executive in the form attached hereto as Exhibit B:
pay to the Executive, in a lump sum within ten (10) days following the Date of Termination, an amount (the “Severance Amount”) equal to the Annual Base Salary that the Executive would have been entitled to receive if the Executive had continued his employment hereunder for a period of two years following the Date of Termination (the “Severance Period”);
pay to the Executive, in accordance with the terms of the Executive Bonus Plan, on the first date after the Date of Termination on which annual bonuses are paid to executives of the Company with respect to the applicable year (each such date, an “Annual Bonus Payment Date”), the Pro Rata Bonus;
pay to the Executive, on the first Annual Bonus Payment Date after the Date of Termination, an amount equal to the product of the Severance Bonus Amount and a fraction, the numerator of which is the number of months in the fiscal year (in which the Executive’s employment termination occurs) after the Date of Termination (the “Initial Stub Period”) and the denominator of which is 12;
pay to the Executive, on the second Annual Bonus Payment Date occurring after the Date of Termination, the Severance Bonus Amount;
pay to the Executive, on the third Annual Bonus Payment Date occurring after the Date of Termination, an amount equal to the product of (A) a fraction, the numerator of which is the difference between 12 and the number of months in the Initial Stub Period and the denominator of which is 12, and (B) the Severance Bonus Amount; and
continue, during the Severance Period, coverage for the Executive and any dependents under all the Company group health benefit plans in which the Executive and any dependents were entitled to participate immediately prior to the Date of Termination, to the extent permitted thereunder, at no greater cost to the Executive than that paid by an active employee.
Termination for Other Reasons. If the Executive’s employment shall be terminated by the Company for Cause pursuant to Section 4(a)(iii), by the Executive without Good Reason pursuant to Section 4(a)(vi), or by the Executive
by notice of non-extension pursuant to Section 4(a)(viii), the Company shall pay to the Executive the amounts set forth in Section 4(c) and shall not have any further obligations to the Executive.
Excess Parachute Payments. If so requested by the Executive prior to and in relation to a change of control of the Company occurring after the Effective Date, the Company shall use its best efforts to prepare and deliver to its stockholders the disclosure required by Section 280G(b)(5)(B) of the Internal Revenue Code and the Regulations thereunder (collectively, the “Code”) with respect to any amounts payable hereunder (provided the Executive agrees to waive his rights to receive such amounts) and to obtain the approval of the Company’s stockholders in accordance with such section of the Code. If such stockholder approval is not obtained, no severance payments shall be made under this Section 5 to the extent such payments would be treated as excess parachute payments under Section 280G(b)(1) of the Code.
Survival. The expiration or termination of the Term shall not impair the rights or obligations of any party hereto, which shall have accrued prior to such expiration or termination.
No mitigation of damages; no offset. In the event of any termination of the Executive’s employment, the Executive shall not be required to seek other employment to mitigate damages, and no income earned by the Executive from other employment or self-employment shall be offset against any obligation of the Company to the Executive under this Agreement.
The Executive shall not, at any time during the Term of this Agreement, or during the 24-month period following the Date of Termination (the “Non-Compete Period”), directly or indirectly, engage in, have any equity interest in, or manage or operate the portion of any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in a Jones Act business that competes with any business of the Company or any entity owned by the Company anywhere in the world provided, however, that the Executive shall be permitted to acquire a passive stock or equity interest in such a business provided the stock or other equity interest acquired is not more than five percent (5%) of the outstanding interest in such business nor prevent him from working for an entity that conducts a Jones Act business so long as he is not involved in that part of the business.
During the Non-Compete Period, the Executive will not directly or indirectly, recruit or otherwise solicit or induce any employee or supplier of the Company to terminate its employment or arrangement with the Company, or otherwise change its relationship with the Company.
In the event the terms of this Section 6 shall be determined by any court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action.
As used in this Section 6, the term “Company” shall include the Company, its parent companies and any of its direct or indirect subsidiaries.
Nondisclosure of Proprietary Information.
Except as required in the faithful performance of the Executive’s duties hereunder or pursuant to Section 7(c), the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his benefit or the benefit of any person, firm, corporation or other entity any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company’s operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets, provided the foregoing shall not apply to good faith disclosure in the course of the Executive’s duties or compliance with legal process or governmental inquiry. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
Upon termination of the Executive’s employment with the Company for any reason, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company’s customers, business plans, marketing strategies, products or processes provided to the Executive by the Company, developed by the Company or the Executive or received by the Executive in connection with the Executive’s employment.
The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the prompt notice thereof, shall, as much in advance of the return date as reasonably possible, make available to the Company and its counsel the documents and other information sought and shall reasonably assist such counsel in resisting or otherwise responding to such process. For purposes
of the preceding sentence, the Company shall reimburse the Executive for reasonable expenses incurred.
As used in this Section 7, the term “Company” shall include the Company, its parent companies, and any of its direct or indirect subsidiaries.
All rights to discoveries, inventions, improvements and innovations (including all data and records pertaining thereto) related to the Company’s business, whether or not patentable, copyrightable, registrable as a trademark, or reduced to writing, that the Executive may discover, invent or originate during the Term, either alone or with others and whether or not during working hours or by the use of the facilities of the Company (“Inventions”), shall be the exclusive property of the Company. The Executive shall promptly disclose all Inventions to the Company, shall execute at the request of the Company any assignments or other documents the Company may deem necessary to protect or perfect its rights therein, and shall assist the Company, at the Company’s expense, in obtaining, defending and enforcing the Company’s rights therein. The Executive hereby appoints the Company as his attorney-in-fact to execute on his behalf any assignments or other documents deemed necessary by the Company to protect or perfect its rights to any Inventions.
It is recognized and acknowledged by the Executive that a breach of the covenants contained in Sections 6, 7 and 8 will cause irreparable damage to the Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in Sections 6, 7 and 8, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
Assignment and Successors.
The Company may assign its rights and obligations under this Agreement only to an assignee that is qualified under applicable law to become an owner of a Jones Act business and that is either (x) a successor to all or substantially all the assets of the Company, by merger or otherwise or (y) approved by the Executive is writing in advance of such assignment (a “Permissible Assignee”). The Company may assign or encumber this Agreement and its rights hereunder as security for indebtedness of the Company and its affiliates. The Executive may not assign his rights or obligations under this Agreement to any individual or entity. This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.
This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the state of New York, without reference to the principles of
conflicts of law of New York or any other jurisdiction, and where applicable, the laws of the United States.
The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:
4064 Colony Road
H-Lines Holding Corp.
c/o Castle Harlan Partners IV, L.P.
Fax: (212) 207-8042
Attn: Marcel Fournier
Fax: (212) 593-5955
Attn: André Weiss
or at any other address as any party shall have specified by notice in writing to the other party.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.
The terms of this Agreement and the other agreements and instruments contemplated hereby or referred to herein (collectively the “Related Agreements”) are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement, including, but not limited to, the Employment Agreement dated as of February , 2003 between Horizon Lines, LLC and the Executive. The parties further intend that this Agreement and the Related Agreements shall constitute the complete and exclusive statement of their terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement and the Related Agreements.
Amendments; Waivers.
This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and a duly authorized officer of the Company. By an instrument in writing similarly executed, the Executive or a duly authorized officer of the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
No Inconsistent Actions.
The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.
This Agreement shall be deemed drafted equally by both the parties. Its language shall be construed as a whole and according to its fair meaning. Any presumption or principle that the
language is to be construed against any party shall not apply. The headings in this Agreement are only for convenience and are not intended to affect construction or interpretation. Any references to paragraphs, subparagraphs, sections or subsections are to those parts of this Agreement, unless the context clearly indicates to the contrary. Also, unless the context clearly indicates to the contrary, (a) the plural includes the singular and the singular includes the plural; (b) “and” and “or” are each used both conjunctively and disjunctively; (c) “any,” “all,” “each,” or “every” means “any and all,” and “each and every”; (d) “includes” and “including” are each “without limitation”; (e) “herein,” “hereof,” “hereunder” and other similar compounds of the word “here” refer to the entire Agreement and not to any particular paragraph, subparagraph, section or subsection; and (f) all pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural as the identity of the entities or persons referred to may require.
Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before an arbitrator in Delaware in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitration award in any court having jurisdiction, provided, however, that the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Sections 6, 7 or 8 of the Agreement and the Executive hereby consents that such restraining order or injunction may be granted without requiring the Company to post a bond. Only individuals who are (i) lawyers engaged full time in the practice of law and (ii) on the AAA register of arbitrators shall be selected as an arbitrator. Within 20 days of the conclusion of the arbitration hearing, the arbitrator shall prepare written findings of fact and conclusions of law. It is mutually agreed that the written decision of the arbitrator shall be valid, binding, final and non-appealable, provided however, that the parties hereto agree that the arbitrator shall not be empowered to award punitive damages against any party to such arbitration. The arbitrator shall require the non-prevailing party to pay the arbitrator’s full fees and expenses or, if in the arbitrator’s opinion there is no prevailing party, the arbitrator’s fees and expenses will be borne equally by the parties thereto. In the event action is brought to enforce the provisions of this Agreement pursuant to this Section 19, the arbitrator may direct that non-prevailing parties be required to pay the reasonable attorney’s fees and expenses of the prevailing parties, provided that no award for attorney’s fees shall be made against the Executive unless the arbitrator finds that his position was frivolous or taken in bad faith; otherwise, each party shall pay its own attorney’s fees and expenses.
If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws effective during the term of this Agreement, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a portion of this Agreement; and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision there shall be added
automatically as part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.
Indemnification and Liability Insurance.
The Company hereby covenants and agrees to indemnify the Executive and hold him harmless to the fullest extent permitted by law and under the By-laws of the Company against and in respect to any and all actions, suits, proceedings, claims, demands, judgments, costs, expenses (including attorney’s fees), losses, and damages resulting from the Executive’s good faith performance of his duties and obligations with the Company (including service prior to the Effective Date hereof). The Company, within 30 days of presentation of invoices, shall reimburse the Executive for all reasonable legal fees and disbursements reasonably incurred by the Executive in connection with any potentially indemnifiable matter under this Section 21; provided, however, that the Executive shall consult with the Company prior to selecting his counsel and shall obtain the Company’s approval, which approval shall not be unreasonably withheld, of such counsel. In addition, the Company shall cover the Executive under directors and officers liability insurance both during and, while potential liability exists (but no less than six years), after the term of this Agreement in the same amount and to the same extent, if any, as the Company covers its other officers and directors.
The Company shall be entitled to withhold from any amounts payable under this Agreement any federal, state, local or foreign withholding or other taxes or charges which the Company is required to withhold. The Company shall be entitled to rely on an opinion of counsel if any questions as to the amount or requirement of withholding shall arise.
Employee Acknowledgement.
The parties acknowledge that they have read and understand this Agreement, are fully aware of its legal effect, have not acted in reliance upon any representations or promises made by the other party other than those contained in writing herein, and has entered into this Agreement freely based on his or its own judgment.
/s/ M. Mark Urbania
M. Mark Urbania
/s/ Charles G. Raymond
FORM OF EMPLOYMENT GENERAL RELEASE
INCLUDES A RELEASE OF KNOWN AND UNKNOWN CLAIMS.
In exchange for the waiver of claims by Charles Raymond (“Executive”) against the Company Released Entities (as defined below) and compliance with other terms and conditions of this General Release, upon the effectiveness of this General Release, the Company agrees to provide Executive with the severance payments and benefits provided under Section 5(c) of the employment agreement dated as of July 7, 2004 by and between Horizon Lines, LLC, a Delaware limited liability company, and Executive (the “Employment Agreement”). In consideration for the payments and benefits to be provided to Executive as set forth in the preceding sentence, Executive individually and on behalf of his respective heirs, executors, administrators, representatives, agents, attorneys and assigns (the “Executive Releasor”), hereby irrevocably, fully and unconditionally releases and forever discharges Horizon Lines, LLC, (the “Company”) and its affiliated companies, parents, subsidiaries, predecessors, successors, assigns, divisions, related entities and all of their present employees, officers, directors, trustees, shareholders, members, partners (as applicable), agents, investors, attorneys and representatives (the “Company Released Parties”), from any and all manner of actions and causes of action, suits, debts, dues, accounts, bonds, covenants, contracts, agreements, judgments, charges, claims, and demands whatsoever which the Executive Releasor, has, or may hereafter have, against the Company Released Parties or any of them arising out of or by reason of any cause, matter or thing whatsoever from the beginning of the world to the date hereof, including without limitation any and all matters relating to employment with the Company, its parent companies and its subsidiaries, and the cessation thereof and all matters arising under any federal, state or local statute, rule or regulation or principle of contract law or common law, including but not limited to the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621, et seq., Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000 et seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., the Fair Labor Standards Act, 29 U.S.C. § 201 et seq., the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq. and applicable labor and employment laws of the states of New York and North Carolina.
Notwithstanding the foregoing, nothing in this General Release shall be a waiver of claims: (1) that may arise after the date on which Executive signs this General Release; (2) with respect to Executive’s right to enforce his rights under Sections 4(c), 5(c) and 19 of the Employment Agreement and under any other written agreement between the Executive and the Company; (3) regarding rights of indemnification, receipt of legal fees and directors and officers liability insurance to which Executive is entitled under the Employment Agreement, the Company’s Certificate of Incorporation or By-laws, pursuant to any separate writing between Executive and the Company or pursuant to applicable law; (4) relating to any claims for accrued, vested benefits of Executive under any employee benefit plan or pension plan of the Company Released Parties subject to the terms and conditions of such plan and applicable law; (5) relating to the rights to protections from the Company Released Entities (pursuant to the Employment Agreement) in connection with Section 4999 of the Internal Revenue Code of 1986, as amended
or any successor thereto; or (6) solely in his capacity as a stockholder or optionholder of the Company (including Executive’s right to enforce his rights under any agreements between the Executive and the Company relating to equity).
Executive acknowledges that he has been given the opportunity to review and consider this General Release for twenty-one (21) days from the date he received a copy. If he elects to sign before the expiration of the twenty-one (21) days, Executive acknowledges that he will have chosen, of his own free will without any duress, to waive his right to the full twenty-one (21) day period.
Executive may revoke this General Release after signing it by giving written notice to , within seven (7) days after signing it. This General Release, provided it is not revoked, will be effective on the eighth (8th) day after execution.
Executive acknowledges that he has been advised to consult with an attorney prior to signing this General Release.
Executive is signing this General Release knowingly, voluntarily and with full understanding of its terms and effects. Executive is signing this General Release of his own free will without any duress, being fully informed and after due deliberation. Executive voluntarily accepts the consideration provided to him for the purpose of making full and final settlement of all claims referred to above.
Executive acknowledges that he has not relied on any representations or statements not set forth in this General Release. Executive will not disclose the contents or substance of this General Release to any third parties, other than his attorneys, accountants, or as required by law, and Executive will instruct each of the foregoing not to disclose the same.
This General Release will be governed by and construed in accordance with the laws of the State of New York. If any provision in this General Release is held invalid or unenforceable for any reason, the remaining provisions shall be construed as if the invalid or unenforceable provision had not been included.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have executed this General Release as of .
EX-10.50 2 g26402kexv10w50.htm EX-10.50
This Separation Agreement (the “Agreement”) is made and entered into effective as of the 23d day of February, 2011 by and between Horizon Lines, Inc. (“the Company”) and Charles G. Raymond (“Executive”).
1. Separation from Service.
1.1 Resignation from Current Positions and Offices. Effective March 11, 2011, Executive shall retire as the Chairman of the Board, Chief Executive Officer and President of the Company, and shall resign from any and all positions and offices he has held with the Company and any affiliates, whether as an officer, director, manager, committee member or otherwise, including as a director of the Company. The date on which Executive retires shall be the “Separation Date.”
1.2 Executive’s separation on the Separation Date shall be deemed to be a termination other than for Cause within the meaning of all outstanding award agreements under the Horizon Lines, Inc. 2009 Amended and Restated Equity Incentive Compensation Plan (the “Plan”) and the Prior Plan (as defined in the Plan) between the Company and Executive (the “Award Agreements”).
2. Separation Benefits.
In consideration of Executive’s execution (without revocation) of the Executive Release (attached as Exhibit A to this Agreement) and his release of all claims as provided in the Executive Release as provided in Section 7 of this Agreement, and Executive’s other agreements herein, the Company agrees to provide Executive with the following payments and benefits, less all required withholding and other authorized deductions, on the later of the date specified in subsections 2(a)-(d), the Waiver Effective Date (as the latter term is defined in the Executive Release), and the date specified in Section 18:
(a) Current Base Salary through the Separation Date.
(b) Any amounts payable under all applicable Company plans or programs, determined pursuant to the express terms of such plans or programs.
(c) The Company shall pay Executive Separation Pay, which will be paid in seven monthly installments of $140,000, commencing on the date after the Waiver Effective Date and monthly thereafter on the first day of each succeeding month.
(d) The Company shall make additional payments to Executive in eighteen (18) equal monthly installments of $72,333 commencing on October 1, 2011 and monthly thereafter on the first day of each succeeding month.
(e) Executive shall be entitled to indemnification and advancement of expenses in connection with any claims asserted against Executive relating to his employment with the Company, to the extent required under the terms of the Company’s charter and bylaws or any other applicable documentation, including the letter agreement and undertaking dated April 30,
2008, from Robert S. Zuckerman, Vice President, General Counsel and Secretary of the Company to Executive (the “Indemnification Agreement”), in each case, in accordance with the terms and conditions set forth therein.
3. Payment of Reimbursements Through the Separation Date.
Executive shall be entitled to the following within 30 days of the Separation Date: All reimbursable business expenses incurred on or before the Separation Date, provided that Executive submits a written request (following the Company’s standard business procedures) within thirty days following the Separation Date. If the Company does not receive from Executive a timely request for reimbursement as set forth in this Section 3, Executive will be deemed conclusively to have waived any claim for reimbursement.
4. Equity Awards.
Except as provided in this Section 4, nothing in this Agreement shall modify the terms of the Plan, the Prior Plan, the Award Agreements, or the terms of any grant, or other award held by Executive pursuant to the Plan or the Prior Plan, as applicable. For the avoidance of doubt, the parties agree that any unvested Restricted Shares granted pursuant to the Restricted Stock Agreement shall become 100% vested as of the Separation Date, and any stock options granted pursuant to the 2008 award agreement shall become 100% vested as of the Separation Date. All stock options granted to Executive under the Plan or the Prior Plan and remaining outstanding as of the Separation Date shall continue to be exercisable until the earlier of the latest date upon which the stock option could have expired by their original terms under any circumstances or the 10th anniversary of the original date of grant of the stock option.
Executive agrees that he will not sell or transfer, directly or indirectly, any shares of Company stock that he owns or controls for a period of one year following the Separation Date.
5. No Other Compensation.
Except as set forth in Sections 2, 3, 4, 6 and 19 of this Agreement, Executive shall not be entitled to any other salary, commission, bonuses, employee benefits (including long and short term disability, 401(k), and pension), expense reimbursement or compensation from the Company or its affiliates after the date of the Separation Date and all of Executive’s rights to salary, commission, bonuses, employee benefits and other compensation hereunder which would have accrued or become payable after the Separation Date from the Company shall cease upon the Separation Date, other than those expressly required under applicable law (such as the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”)). Notwithstanding the foregoing, nothing in this Agreement is intended to modify or waive any rights to vested benefits under the Company’s benefit plans, including any grant or other award held by Executive pursuant to the Plan and/or the Prior Plan, such benefits being payable to Executive pursuant to the terms and conditions set forth in the applicable plan and award documents.
6. COBRA.
On or after the Separation Date, the Company will deliver to Executive a letter outlining the terms of COBRA, including the COBRA premiums. Executive will have the option to elect
to continue health care coverage under COBRA, as explained in the COBRA letter. In the event that Executive timely exercises his rights under COBRA, Executive will be responsible for paying the COBRA premiums and the Company shall reimburse Executive for the COBRA premiums paid by him for the period commencing on the Separation Date and ending on the maximum period of time the Company is required to provide Executive and his eligible dependants health continuation coverage under COBRA. Any such reimbursement of premiums under this Section shall be made by the Company within thirty (30) days after Executive provides substantiation of the payment of required COBRA premium but in no event later than the last day of Executive’s taxable year following the taxable year in which the premium expenses are incurred. The amount of any such premium expenses reimbursed in one year will not affect the premium expenses eligible for reimbursement in any subsequent year, and Executive’s right to such reimbursement will not be subject to liquidation or exchange for any other benefit. The reimbursement of premium expenses pursuant to this Section will also satisfy all other requirements of the regulations under Section 409A of the Internal Revenue Code of 1986 with respect to any such reimbursements.
7. Mutual Release.
7.1 Executive Release. Concurrently with the execution of this Agreement, Executive shall execute and deliver to the Company a general release in the form of Exhibit A attached hereto (the “Executive Release”), which Release shall be effective as of the date hereof and, as a condition to any payments set forth in Section 2, 3, 4 and 6 above and Section 19 below, shall not be revoked in whole or in part. The payments and benefits described in Sections 2, 3, 4 and 6 and 19 of this Agreement are conditioned upon the Executive Release being in full force and effect.
7.2 Company Release. The Company releases Executive and his assigns, agents, and heirs from any liability with respect to all claims, rights, demands, actions, obligations, debts, sums of money, damages, and causes of action arising from employment with the Company; provided however, that this release shall not apply to any claims arising from any intentional act of misconduct by Executive or any other intentional act taken by Executive in bad faith or without a reasonable belief that it was in the best interest of the Company. This Company Release is conditioned on the Executive Release being in full force and effect.
8. Confidential Information and Competition.
The parties agree that all terms and provisions of any agreements between Executive and the Company related to Confidential Information shall remain in full force and effect as provided in such agreements.
Executive shall not, during the twenty-four month period following the Separation Date, directly or indirectly engage in, have any equity interest in, or manage or operate any person, firm, corporation, partnership or business (whether as a director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any business of the Company, its parent, and their respective direct and indirect subsidiaries anywhere in the world; provided, however, that Executive shall be permitted
to acquire a passive stock or equity interest in such a business provided the stock or other equity interest acquired is not more than 5% of the outstanding interest in such business.
9. Return of Confidential Information and Equipment.
Executive recognizes and acknowledges that he has received Confidential Information from the Company. Executive agrees that he will deliver to the Company all copies of Confidential Information in any form, electronic or otherwise, pertaining to the Company or its business. Such Confidential Information includes, without limitation, contact information in his possession in any form, electronic or otherwise, pertaining to any customers or vendors (existing or potential) of the Company on or before the Separation Date (or on such earlier date as requested by the Company in writing). Unless earlier requested by the Company in writing, Executive shall also return to the Company on or before the Separation Date his building pass, parking pass, any credit card, any electronic devices and/or equipment including blackberry or cell phone, door keys, and all other personal property owned by the Company or purchased by the Company for use by Executive during the term of his employment.
10. Cooperation with Company.
Employee acknowledges and agrees that following the Separation Date he will cooperate fully with the Company, its officers, employees, agents, affiliates and attorneys in the defense or prosecution of, or in preparation for the defense or prosecution of any lawsuit, dispute, investigation or other legal proceedings (“Proceedings”). Executive further acknowledges and agrees that he will cooperate fully with the Company, its officers, employees, agents, affiliates and attorneys on any matter related to Company business (“Matters”) arising during the period of Executive’s employment with the Company. Such cooperation shall include providing true and accurate information or documents concerning, or affidavits or testimony about, all or any matters at issue in any Proceedings or Matters as shall from time to time be requested by the Company, and shall be within the knowledge of Executive. Such cooperation shall be provided by Executive without remuneration, but Executive shall be entitled to reimbursement for all reasonable and appropriate expenses incurred by him in so cooperating including, by way of example and not by way of limitation, airplane fare, hotel accommodations, meal charges and other similar expenses to attend Proceedings or Matters outside of the city of Executive’s residence; provided, however, notwithstanding any provision of this Agreement or the Indemnification Agreement to the contrary, Executive shall not be required as a condition to having and securing the indemnification and advancement of expenses as defined in this Agreement, including without limitation Section 2(e) of this Agreement, or in the Indemnification Agreement, to waive or forfeit, in whole or in part, any legal privilege whatsoever that Executive may have, including without limitation, the attorney-client privilege or the privilege against self-incrimination, and this Agreement shall not limit or reduce the scope of the Company’s indemnification to which Executive is entitled under the Indemnification Agreement. In the event Executive is asked by a third party to provide information regarding the Company, he will notify the Company as soon as possible in order to give the Company a reasonable opportunity to respond and/or participate in such Proceeding or Matter.
11. Nondisparagement.
Executive agrees that he will not, at any time, directly or indirectly, individually or in concert with others, engage in any conduct or make any statement that is calculated or likely to have the effect of undermining, disparaging or otherwise reflecting poorly upon the reputation, good will, products, services, or business opportunities of the Company or its respective subsidiaries, affiliates, officers, directors, shareholders, attorneys, employees (with respect to their employment with the Company), representatives, successors and assigns, and any and all related corporate entities, either orally, in writing, or in any other form of communication. The Company agrees that its board of directors will not at any time, directly or indirectly, individually or in concert with others, engage in any conduct or make any statement that is calculated or likely to have the effect of undermining, disparaging or otherwise reflecting poorly upon the reputation or good will of the Executive, either orally, in writing, or in any other form of communication.
Notwithstanding the foregoing, no provision of this Agreement shall in any way limit Executive’s ability to cooperate with the Company or either party’s ability to cooperate with any federal, state or local government investigative agency or department or in connection with any federal, state or local government investigation or be construed as prohibiting the provision of non-privileged information, documents (including but not limited to this Agreement) and/or testimony by Executive or the Company in response to a subpoena issued by a court of competent jurisdiction, or as may otherwise be required by law or which Executive or the Company may be requested to provide to any federal, state, or local governmental investigative agency or department or in connection with any federal, state, or local investigation. However, in the event of receipt of any non-governmental subpoena, Executive agrees to notify the Company promptly before complying with such a subpoena so that it may protect its interests, including moving to quash the subpoena, as long as provision of such notice does not violate any applicable law, rule, or court order. If the Company seeks to prevent disclosure in accordance with the applicable legal procedures, and provides Executive with notice before the deadline for Executive’s compliance with the subpoena, Executive shall not make any such disclosures until either such objections are withdrawn or the objections are finally adjudicated by the appropriate tribunal to be invalid.
Each party shall provide the other a reasonable opportunity to review and provide comments to any press release or other public announcement or written statement concerning this Agreement or the transactions contemplated hereby.
12. Resolution of Claims.
The provisions of this Agreement are contractual and not merely recitals and are intended to resolve disputed claims. No party hereto admits liability of any kind and no portion of this Agreement shall be construed as an admission of liability.
13. No Assignment of Claims.
Executive and the Company represent, recognizing that the truth of the following representation is a material consideration upon which this Agreement is based, that they have not
heretofore assigned or transferred, or purported to assign or transfer, to any person or entity, any claim or any portion thereof, or interest therein relating to any claims being released by any party to this Agreement, and that they are unaware of any other entity having any interest in such claims, and agree to indemnify and hold the other party harmless from and against any and all claims, based on or arising out of any such third-party interest in, or assignment or transfer, or purported assignment or transfer of, any claims, or any portion thereof or interest therein.
This Agreement is to be governed and construed in accordance with the laws of the State of New York, without regard to the choice of law provisions thereof.
Except as otherwise required by law, any notice, consent, request, instruction, approval and other communication provided for herein shall be in writing and shall be effective immediately when delivered in person or three (3) days after such notice is deposited in the United States mail, postage prepaid, and addressed to Executive at Executive’s last known address on the books of the Company, or in the case of the Company, to it at its principal place of business, attention Chairman of the Board of Directors, or to such other address as either party may specify by notice to the other actually received.
16. Taxes.
All payments made by the Company under this Agreement will be subject to applicable federal, state and local taxes, and withholdings required for the same, which taxes will be the responsibility of Executive.
17. Entire Agreement; Severability.
This Agreement, including but not limited to the General Release attached as Exhibit A, constitutes the entire agreement and understanding among the parties hereto and replaces, cancels and supersedes any prior agreements and understandings relating to the subject matter hereof; and all prior representations, agreements, understandings and undertakings among the parties hereto with respect to the subject matter hereof are merged herein. The parties agree that this Agreement is the entire agreement between the parties relating to the subject matter hereof, and that there is no agreement, representation or other inducement for the execution of this Agreement other than the consideration recited herein. Should any provision of this Agreement be found to be invalid or unenforceable, the remaining provisions of this Agreement shall be deemed to be in full force and effect, at the Company’s sole discretion, to the fullest extent permitted by law. Any waiver of any term or provision of this Agreement shall not be deemed a continuing waiver and shall not prevent the Company from enforcing such provision in the future.
The prevailing party in any action instituted pursuant to this Agreement shall be entitled to recover from the other party its reasonable attorneys’ fees and other expenses incurred in such action
18. Section 409A.
This Agreement is intended to provide payments that are exempt from or compliant with the provisions of Section 409A of the Internal Revenue Code of 1986 (the “Code”) and related regulations and Treasury pronouncements (“Section 409A”), and the Agreement shall be interpreted accordingly. Notwithstanding anything herein to the contrary, if on the date of his separation from service Executive is a “specified employee,” as defined in Section 409A, then all or a portion of any severance payments, benefits, or reimbursements under this Agreement that would be subject to the additional tax provided by Section 409A(a)(1)(B) of the Code if not delayed as required by Section 409A(a)(2)(B)(i) of the Code shall be delayed until the first day of the seventh month following his separation from service date (or, if earlier, Executive’s date of death) and shall be paid as a lump sum (without interest) on such date. If the Company determines that any provisions of this Agreement do not comply with the requirements of Section 409A, the Company has the authority to amend this Agreement to the extent necessary (including retroactively) in order to preserve compliance with said Section 409A. The Company also has express discretionary authority to take such other actions as may be permissible to correct any failures to comply in operation with the requirements of Section 409A. Neither the Company nor the Executive have any discretion to accelerate the timing or schedule of any benefit payment under this Agreement that is subject to Section 409A, except as specifically provided herein or as may be permitted pursuant to Section 409A. Whenever payments under this Agreement are to be made in installments, each such installment shall be deemed to be a separate and independent payment for purposes of Section 409A.
With regard to any provision of this Agreement that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Section 409A of the Code, (i) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of the Executive’s taxable year following the taxable year in which the expense was incurred.
The Company shall promptly pay upon presentation of appropriate documentation the reasonable legal fees incurred by the Executive in connection with the negotiation and documentation of this Agreement, but not to exceed $15,000.
20. Waiver of Jury Trial.
Each party hereto hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any suit, action or proceeding arising out of or relating to this Agreement.
This Agreement shall be binding on and inure to the benefit of each of the parties hereto, as well as their respective successors, assigns, heirs, executors and administrators.
EXECUTIVE AFFIRMS THAT HE HAS CONSULTED WITH HIS ATTORNEY OR HAS HAD AN OPPORTUNITY TO DO SO PRIOR TO SIGNING THIS AGREEMENT AND THAT HE IS EXECUTING THE AGREEMENT VOLUNTARILY AND WITH FULL UNDERSTANDING OF ITS CONSEQUENCES.
/s/ Stephen H. Fraser
Name: Stephen H. Fraser
Title: Member of the Board of Directors
Charles G. Raymond
GENERAL RELEASE AND COVENANT NOT TO SUE
I, Charles G. Raymond, in consideration of and subject to the performance by Horizon Lines, Inc. (the “Company”) of its obligations under the Separation Agreement dated as of February 23, 2011 (the “Separation Agreement”), and having acknowledged the consideration stated in the Separation Agreement as full compensation for and on account of any and all injuries and damages which I have sustained or claimed, or may be entitled to claim, I, for myself, and my heirs, executors, administrators, successors and assigns, do hereby release, forever discharge and promise not to sue the Company, its parents, subsidiaries, affiliates, successors and assigns, and their past and present officers, directors, partners, employees, members, managers, shareholders, agents, attorneys, accountants, insurers, heirs, administrators, executors (collectively the “Released Parties”) from any and all claims, liabilities, costs, expenses, judgments, attorney fees, actions, known and unknown, of every kind and nature whatsoever in law or equity, which I had, now have, or may have against the Released Parties relating in any way to my employment or affiliation with the Company or the end thereof, including, but not limited to, all claims for contract damages, tort damages, special, general, direct, punitive and consequential damages, compensatory damages, loss of profits, attorney fees and any and all other damages of any kind or nature; all contracts, oral or written, between me and any of the Released Parties; any business enterprise or proposed enterprise currently contemplated by any of the Released Parties, as well as anything done or not done prior to and including the date of execution of this General Release. Nothing in this General Release shall be construed to release the Company from any of its obligations set forth in the Separation Agreement, provided I do not revoke this General Release.
I understand and agree that this General Release shall apply to any and all claims or liabilities arising out of or relating to my employment with the Company and the end of such employment, including, but not limited to: claims of discrimination based on age, race, color, gender, religion, national origin, marital status, parental status, veteran status, disability or any other grounds under applicable federal, state or local law, including, but not limited to, claims arising under the Age Discrimination in Employment Act of 1967, as amended; the Americans with Disabilities Act; the Fair Labor Standards Act; the Family and Medical Leave Act; and Title VII of the Civil Rights Act, as amended, the Civil Rights Act of 1991; 42 U.S.C. § 1981, the Employee Retirement Income Security Act, the Consolidated Omnibus Budget Reconciliation Act of 1985 as amended, the Rehabilitation Act of 1973, the Equal Pay Act of 1963 (EPA), as well as any claims regarding wages; benefits; vacation; sick leave; business expense reimbursements; wrongful termination; breach of the covenant of good faith and fair dealing; intentional or negligent infliction of emotional distress; retaliation; whistleblower protections; outrage; defamation; invasion of privacy; breach of contract; fraud or negligent misrepresentation; harassment; breach of duty; negligence; discrimination; claims under any employment, contract or tort laws; claims arising under any other federal law, state law, municipal law, local law, or common law; any claims arising out of any employment contract, policy or procedure; and any other claims related to or arising out of my employment or the separation of my employment with the Company.
In addition, I agree not to cause or encourage any legal proceeding to be maintained or instituted against any of the Released Parties.
Acknowledgement of Waive of Claims under ADEA. I expressly acknowledge that I am voluntarily, irrevocably and unconditionally releasing and forever discharging the Company and its respective present and former parents, subsidiaries, divisions, affiliates, branches, insurers, agencies, and other offices from all rights or claims I had or may have against the Company relating to my employment and the end of that employment, including, but not limited to, without limitation, all charges, claims of money, demands, rights, and causes of action arising under the Age Discrimination in Employment Act of 1967, as amended (“ADEA”), including, but not limited to, all claims of age discrimination in employment and all claims of retaliation in violation of ADEA. I further acknowledge that the consideration given for this waiver of claims under the ADEA is in addition to anything of value to which I was already entitled in the absence of this waiver. I further acknowledge: (a) that I have been informed by this writing that I should consult with an attorney prior to executing this General Release; (b) that I have carefully read and fully understand all of the provisions of this General Release; (c) that I am, through this General Release, releasing the Company from any and all claims I may have against it under the ADEA; (d) that I understand and agree that this waiver and release does not apply to any claims that may arise under the ADEA after the date I execute this General Release; (e) that I have at least twenty-one (21) days within which to consider this General Release; (f) that I have seven (7) days following my execution of this General Release to revoke this General Release (as provided below); and (g) this General Release shall not be effective until the revocation period has expired and I have signed and have not revoked the Agreement.
This General Release does not apply to any claims any claims for unemployment compensation or any other claims or rights which, by law, cannot be waived, including the right to file an administrative charge or to participate in an administrative investigation or proceeding; provided, however that I disclaim and waive any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation or proceeding.
I understand that any payments or benefits paid or granted to me under the Separation Agreement on or after the date hereof represent, in part, consideration for signing this General Release and are not salary, wages or benefits to which I was already entitled. I understand and agree that I will not receive such payments and benefits specified in the Separation Agreement unless I execute this General Release and do not revoke or breach this General Release. Such payments and benefits will not be considered compensation for purposes of any employee benefit plan, program, policy or arrangement maintained or hereafter established by the Company or its affiliates. I also acknowledge and represent that I have received all payments and benefits that I am entitled to receive (as of the date hereof) by virtue of any employment by the Company.
Sufficient Time to Review. I acknowledge and agrees that: (i) I have had reasonable and sufficient time to read and review this General Release and that I have, in fact, read and reviewed this Agreement; (ii) that I have the right to consult with legal counsel regarding this General Release and was encouraged to consult with legal counsel with regard to this General Release; (iii) that I have had (or has had the opportunity to take) twenty-one (21) calendar days to discuss the Agreement with a lawyer of my choice before signing it and, if I sign before the end of that
period, I do so of my own free will and with the full knowledge that I could have taken the full period; (iv) that I am entering into this General Release freely and voluntarily and not as a result of any coercion, duress or undue influence; (v) that I am not relying upon any oral representations made to me regarding the subject matter of this General Release; (vi) that by this General Release I am receiving consideration in addition to that which I was already entitled; and (vii) that I have received all information I require from the Company in order to make a knowing and voluntary release and waiver of all claims against the Company.
Revocation/Payment. I acknowledge and agree that I have seven (7) days from the date of the execution of this General Release within which to rescind or revoke this General Release by providing notice in writing to the Company. I further understand that the obligations under Section 2, 3, 4, 6 and 19 of the Separation Agreement will have no force and effect until the end of that seventh day (the “Waiver Effective Date”), and that I will receive the payments and benefits identified in Sections 2, 3, 4, 6, 7 and 19 of the Separation Agreement after the Waiver Effective Date and following the Company’s receipt of the General Release and the Separation Agreement as executed by me if this General Release is not revoked. If I revoke the General Release pursuant to this paragraph, the Company will not be obligated to pay or provide me with the separation benefits and other benefits described in the Separation Agreement.
I agree that neither this General Release, nor the furnishing of the consideration for this General Release, shall be deemed or construed at any time to be an admission by the Company, any Released Party or myself of any improper or unlawful conduct.
Notwithstanding anything in this General Release to the contrary, this General Release shall not relinquish, diminish, or in any way affect any rights or claims arising out of any breach by the Company or by any Released Party of the Separation Agreement as modified by the Separation Agreement, or any of the Company’s benefit plans qualified under the Employee Retirement Income Security Act of 1974, in each case after the date hereof.
All issues and questions concerning the construction, validity, enforcement and interpretation of this General Release shall be governed by and construed in accordance with the laws of the State of New York without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the law of any jurisdiction other than the State of New York.
1) I HAVE READ IT CAREFULLY;
2) I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED;
3) I VOLUNTARILY CONSENT TO EVERYTHING IN IT;
4) I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND
8) I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.
EX-10.51 3 g26402kexv10w51.htm EX-10.51
This Employment Agreement (this “Agreement”) is entered into as of March 3, 2011 (the “Effective Date”), by and between Horizon Lines, Inc., a Delaware corporation (the “Company”), and Stephen H. Fraser (“Executive”).
WHEREAS, prior to the Effective Date, Executive has served as a non-employee member of the Company’s Board of Directors (the “Board”); and
WHEREAS, the Company has determined that it is in the best interests of the Company and its stockholders to enter into an employment agreement with Executive for Executive to serve as the Company’s interim President and Chief Executive Officer and Executive is willing to serve as interim President and Chief Executive Officer of the Company, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, it is hereby covenanted and agreed by Executive and the Company as follows:
(a) Term. Executive’s employment under this Agreement shall commence as of the Effective Date and shall terminate as of the date a successor President and Chief Executive Officer is appointed by the Board, unless terminated earlier by either party upon 30 days advance written notice pursuant to the procedures set forth in Section 5 hereof (the “Employment Term”); provided that the Board and Executive may agree to extend the Employment Term by a period of up to 45 days following the appointment of a successor President and Chief Executive Officer if such extension is necessary for the transition of Executive’s duties and responsibilities to such successor. Subject to Section 2(b), upon the termination of Executive’s employment, Executive (or his estate, heirs or beneficiaries, as applicable) shall be entitled to (i) payment of any earned, but unpaid Salary, (ii) payment of any accrued but unused vacation or paid time off, and (iii) other employee benefits to which Executive is entitled upon termination of employment in accordance with the terms of the applicable plans and programs of the Company.
(b) Duties. During the period beginning on the Effective Date and ending on March 11, 2011, Executive shall be employed by the Company in a nonexecutive position. Effective March 11, 2011, Executive shall be appointed by the Board and thereafter be employed as interim President and Chief Executive Officer of the Company. Executive shall report solely to the Board and shall perform his duties faithfully and efficiently and to the best of his abilities, subject to the directions of the Board. Executive shall devote Executive’s full business time and efforts to the performance of Executive’s assigned duties for the Company. Notwithstanding the foregoing, Executive may continue to serve on the board of directors of Nautilus International Holding Corp. and the board of managers of Focus Products Group, LLC. During the Employment Term, the Company shall provide Executive with an office and administrative support at the Company’s headquarters commensurate with his position.
(c) Board Service. During the Employment Term, Executive shall continue to serve as a member of the Board; provided, however, that as of the Effective Date Executive shall and hereby does resign from his service as a member of the Audit Committee and Finance
Committee. Upon termination of the Employment Term, Executive shall resume service as a non-employee member of the Board.
2. Compensation. (a) Base Salary. During the Employment Term, the Company shall pay Executive a base salary (the “Salary”) at the gross rate of $90,000 per month, payable in accordance with the Company’s payroll practices as in effect for senior executives.
(b) Board Compensation and Stock Ownership Requirements. During the Employment Term, (i) Executive shall continue to receive annual restricted stock grants equivalent to those awarded to non-employee members of the Board, (ii) Executive shall continue to vest in his outstanding equity awards as if he remained a non-employee member of the Board during the Employment Term and (iii) the payment of the annual cash retainer to Executive for his Board service shall be prorated to reflect only Executive’s service as a non-employee member of the Board. During the Employment Term, Executive shall remain subject to the stock ownership requirements applicable to non-employee members of the Board, but not to the stock ownership requirements applicable to executives of the Company.
(c) Benefits. During the Employment Term, Executive shall be eligible to participate in the employee benefit plans generally available to senior executives of the Company, to the extent Executive meets the eligibility requirements of any such plans, and, in any event, subject to the terms of the applicable plans; provided, however, that (i) except as provided in this Agreement, Executive shall not be entitled to receive any severance benefits or participate in the Company’s equity compensation program generally available to senior executives of the Company and (ii) in lieu of Executive’s participation in the Company’s group medical plan during all or any portion of the Employment Term, Executive may elect that the Company reimburse Executive for the premiums paid by Executive for the medical coverage of Executive and his dependents under the plan or policy in effect for their benefit as of the Effective Date. Executive shall be entitled to take time off for vacation or illness in accordance with the Company’s policy for senior executives and to receive all other fringe benefits as are from time to time made generally available to senior executives of the Company. Nothing herein shall affect the Company’s right to alter, suspend, amend or discontinue any and all of its benefit plans, fringe benefits or policies, in whole or in part, at any time with or without notice in accordance with applicable law.
(d) Legal Fees. The Company shall reimburse Executive for all reasonable legal fees and expenses incurred by Executive in connection with the negotiation and review of this Agreement and any documents ancillary thereto.
(e) Expense Reimbursement. During the Employment Term, the Company shall reimburse Executive, in accordance with the Company’s policies and procedures, for all expenses incurred by Executive in the performance of Executive’s duties hereunder. Without limiting the foregoing, the Company shall reimburse Executive for all travel expenses (including transportation, food and lodging) incurred by Executive for travel between Chicago, Illinois and Charlotte, North Carolina.
3. Federal and State Withholding. The Company shall deduct from the amounts payable to Executive pursuant to this Agreement the amount of all required federal, state and local withholding taxes in accordance with Executive’s Form W-4 on file with the Company, and all applicable federal employment taxes.
4. Indemnification. To the fullest extent permitted by the indemnification provisions of the laws of the state or jurisdiction of the Company’s incorporation in effect from time to time, and subject to the conditions thereof, the Company shall (i) indemnify Executive, as a director and officer of the Company or a trustee or fiduciary of an employee benefit plan of the Company against all liabilities and reasonable expenses that Executive may incur in any threatened, pending, or completed action, suit or proceeding, whether civil, criminal or administrative, or investigative and whether formal or informal, because Executive is or was a director or officer of the Company or a trustee or fiduciary of such employee benefit plan, and (ii) pay for or reimburse the reasonable expenses upon submission of appropriate documentation incurred by Executive in the defense of any proceeding to which Executive is a party because Executive is or was a director or officer of the Company or a trustee or fiduciary of such employee benefit plan, including an advancement of such expenses to the extent permitted by applicable law, subject to Executive’s execution of any legally required repayment undertaking. The preceding indemnification right shall be in addition to, and not in lieu of, any rights to indemnification to which Executive may be entitled under the certificate of incorporation and bylaws of the Company in effect from time to time and the Indemnification Agreement, dated June 1, 2010, between Executive and the Company. The indemnification rights of Executive in this Section 4 are referred to below as the “Indemnification Provisions.” The rights of Executive under the Indemnification Provisions shall survive the cessation of Executive’s employment with the Company. The Company shall maintain a directors’ and officers’ liability insurance policy, or an equivalent errors and omissions liability insurance policy, covering Executive with scope, exclusions, amounts and deductibles no less favorable to the insured than those applicable to the Company’s senior officers and directors on the Effective Date, or any more favorable as may be available to any other director or senior executive of the Company, while Executive is employed with the Company and thereafter until the sixth anniversary of Executive’s termination date.
5. Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be deemed given when (a) delivered personally or by overnight courier to the following address of the other parties hereto (or such other address for such parties as shall be specified by notice given pursuant to this Section) or (b) sent by facsimile to the following facsimile number of the other parties hereto (or such other facsimile number for such parties as shall be specified by notice given pursuant to this Section), with the confirmatory copy delivered by overnight courier to the address of such parties pursuant to this Section 5.
4064 Colony Road, Suite 200
Facsimile: (704) 973-7010
Attention: Board of Directors, Chairman
111 Carriage Road
One S. Dearborn
Facsimile: 312-853-7036
Attention: Matthew E. Johnson
7. Entire Agreement. This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related in any manner to the subject matter hereof.
8. Successors and Assigns. This Agreement shall be enforceable by Executive and Executive’s heirs, executors, administrators and legal representatives, and by the Company and its successors and assigns. Executive may not assign this Agreement and any such assignment shall be null and void.
9. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Illinois without regard to principles of conflict of laws. To the extent that any party attempts to bring an action in court, Executive and the Company stipulate that personal jurisdiction over them in the state courts of Illinois is proper and agree that venue shall lie solely in the courts of Illinois over any such action.
10. Section 409A of the Code. This Agreement is intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and shall be interpreted and construed consistently with such intent. The payments to Executive
pursuant to this Agreement are also intended to be exempt from Section 409A of the Code to the maximum extent possible as short-term deferrals pursuant to Treasury regulation §1.409A-1(b)(4). In the event the terms of this Agreement would subject Executive to taxes or penalties under Section 409A of the Code (“409A Penalties”), the Company and Executive shall cooperate diligently to amend the terms of the Agreement to avoid such 409A Penalties, to the extent possible. Any reimbursement or advancement payable to Executive pursuant to this Agreement shall be conditioned on the submission by Executive of all expense reports reasonably required by the Company under any applicable expense reimbursement policy, and shall be paid to Executive within 30 days following receipt of such expense reports, but in no event later than the last day of the calendar year following the calendar year in which Executive incurred the reimbursable expense. Any amount of expenses eligible for reimbursement, or in-kind benefit provided, during a calendar year shall not affect the amount of expenses eligible for reimbursement, or in-kind benefit to be provided, during any other calendar year. The right to any reimbursement or in-kind benefit pursuant to this Agreement shall not be subject to liquidation or exchange for any other benefit.
11. Amendment and Waiver. The provisions of this Agreement may be amended or waived only by the written agreement of the Company and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.
12. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument.
/s/ Michael T. Avara
Michael T. Avara