Document:

8-K2014_3_25Item502Exhibit101

        

Exhibit 10.1

March 17, 2014

Mr. Robert M. Davis

Dear Rob,

On behalf of Merck & Co., Inc. (“Merck” or the “Company”) and its subsidiary Merck Sharp & Dohme Corp. ("MSD"), it is my pleasure to extend to you this offer of employment with MSD in the position of Executive Vice President & Chief Financial Officer (the "Position"), subject to approval of your appointment by the Board of Directors of the Company.  This letter will supersede the February 27, 2014 offer letter.  

In the Position, you will report to me, will be a member of my Executive Committee and will be an Officer of Merck (as defined in Section 16 of the Securities Exchange Act of 1934).  The Position will be based at our corporate headquarters, which is currently in Whitehouse Station, New Jersey and is expected to be moved to Kenilworth, New Jersey in late 2014. 

Our offer is subject to the contingencies set forth below. We anticipate a start date on or about April 28, 2014 (“Start Date”).

Our offer includes the following:

Total Compensation

Base Salary:  You will be paid a gross annual base salary of $950,000, which will be paid on a bi-weekly basis ($36,539 per pay period less applicable withholdings and deductions).  Your salary will be reviewed annually.  

Executive Incentive Plan: You will be eligible to participate in the Executive Incentive Plan (EIP) as it applies to similarly situated MSD employees, subject to the terms of the plan.  The target bonus for performance year 2014 for the Position is 95% of your annual base salary.  The bonus is discretionary and the amount of the bonus, if any, will be determined based on Company performance as well as an assessment of your individual performance. To be eligible for an EIP award, you must have at least 90 days of active service in the plan year and remain actively employed through the end of the plan year.  

Long-Term Incentive (LTI) Program:  You will be eligible for consideration for annual grants of stock-based incentives under the Incentive Stock Plan on terms applicable to similarly situated MSD employees.  For Executive Committee members, annual grants generally include a mix of non-qualified stock options and performance share units (PSUs), with the number and proportion of shares covered by such incentives determined by the Compensation and Benefits Committee of the Board of Directors of Merck (the “Committee”).  For illustrative purposes, a typical annual target grant for your position is valued at approximately $3,500,000.  Currently, annual grants of Merck stock options vest in equal installments over three years and PSUs are subject to a 3-year performance period. The distribution of shares in connection with PSUs is dependent on continued employment

Robert M. Davis
March 17, 2014
Page 2 of 6

with the company and is further contingent on the attainment of specified performance goals.  Please note that the terms and conditions of any future grants may change from time to time.  The specific terms and conditions of your grants will be provided to you shortly after the time the grants are made. 

Based on your job level within the Company, you will be covered by Merck's stock ownership guidelines.  The guidelines are intended to reinforce our philosophy concerning “ownership” and, in a concrete way, quantify our expectations concerning ownership of Merck stock. Based on your job level within the Company, the guidelines provide that you should acquire Merck stock, over time, equal in value to three (3) times your annual base salary.  Importantly, the LTI program – and the retention of shares earned in connection therewith – is intended to facilitate the acquisition of shares.  Also, there is currently no time frame by which you will be required to achieve the multiple of salary ownership level.

Sign-On Incentives

Sign-On Bonus:  You will be eligible to receive a total sign-on bonus in the amount of $5,000,000, less applicable payroll deductions and withholdings (“Sign-on Bonus”), subject to and in accordance with the terms set forth below. 

The Sign-on Bonus will be payable in three installments as follows:  (i) $2,500,000 (less applicable payroll deductions and withholdings) will be payable on or about your first regularly scheduled payday following your start date (“First Installment”);  (ii) $1,250,000 (less applicable payroll deductions and withholdings) will be payable on or about the first regularly scheduled payday following the first year anniversary of your start date provided that you are still employed by Merck or one of Merck & Co., Inc.’s subsidiaries as of such date (“Second Installment”); and (iii) $1,250,000 (less applicable payroll deductions and withholdings) will be payable on or about the first regularly scheduled payday following the second year anniversary of your start date provided that you are still employed by Merck or one of Merck & Co., Inc.’s subsidiaries as of such date (“Third Installment”) (individually and “Installment;” collectively, the "Installments"). 

Your right to receive an Installment is conditioned on your continued employment by MSD or a Merck subsidiary on the date the Installment is due.  If, however, MSD or Merck terminates your employment for reasons other than Cause (as defined below) prior to the due date of an Installment, then any such Installment will remain payable in accordance with the original payment schedule as if your employment had continued through the due date. 

You will be required to repay each and any paid Installment in the event that your employment with MSD or a Merck subsidiary ends prior to the twenty-four month anniversary of your start date as the result of either (a) a decision by you, regardless of reason or (b) a decision by Merck for reason of Cause (as defined below) (“Repayment Event”).  For avoidance of doubt, the cessation of your employment by reason of your death or your inability to work due to a disability is not a Repayment Event.  By your signature below, you agree that, upon a Repayment Event, you will tender a check to MSD in the full amount of any and all Installments that had been paid to you.

Restricted Stock Unit (RSU) Grant:  You will be recommended to receive a RSU grant valued at approximately $5,000,000 (“Sign-On Grant”).  Merck RSU grants are currently scheduled to be made shortly after the release of Company earnings each quarter.  The date of 

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Robert M. Davis
March 17, 2014
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your grant will be the quarterly grant date immediately following your start date.  Subject to its terms, the Sign-On Grant will vest fully on the third anniversary of the grant date (“Vesting Date”).  The terms and conditions of the Sign-On Grant will be governed by a Term Sheet that will be provided to you shortly after the grant is made, except that the “Involuntary Termination” provision of the Term Sheet will be replaced with the following: 

“Involuntary Termination.  If your employment terminates during the Restricted Period and the Company determines that your employment was involuntarily terminated by the Company, then this RSU Award will continue and be distributable in accordance with its terms as if employment had continued and will be distributed at the time active RSU Grantees receive distributions with respect to this Restricted Period.  As used in this paragraph an “involuntary termination” includes the cessation of your employment as the result of a decision by the Company, unless that decision is for Cause (as defined in your offer letter) or by reason of Sale, Death, Misconduct, Disability or Change in Control (each as defined in the Term Sheet).” 

"Cause" as  used in this offer letter means an act or omission by you, which constitutes: a deliberate or reckless disclosure of proprietary or other confidential information relating to Merck and/or its subsidiaries, its personnel, research or business; embezzlement, theft or other misappropriation of the assets of Merck and/or its subsidiaries; deliberate or reckless falsification of records or reports; deliberate or reckless action that causes actual or potential injury or loss to Merck and/or its subsidiaries and/or its and/or their employees; insubordination (meaning the repeated refusal to carry out work assignments and/or direction); failure to demonstrate a reasonable effort to perform assigned job duties; an illegal act on the property of Merck and/or its subsidiaries or in representing Merck and/or its subsidiaries; or a breach by you of your representations as set forth in this letter.

Benefits

Health and Insurance Benefits Program:  You will be eligible to participate in the Health and Insurance Benefits Program applicable to similarly situated MSD employees, which will allow you to choose among various options for medical, dental, vision, employee term life insurance, accidental death and dismemberment insurance, dependent life insurance, long-term disability, health care reimbursement, dependent care reimbursement, and long-term care plans. For most benefits, participation begins on your date of hire.  A Merck Benefits New Hire Kit will be mailed within two weeks of your hire date to your home address from Fidelity Investments, our service provider for both the Health and Insurance Program and the MSD Savings Plan.  This kit provides important information and instructions for enrolling in your benefits as an MSD employee. You will have 30 days from the date Fidelity mails your benefits information to enroll in the benefits available to you under the Health and Insurance Program. If you do not enroll by that date, you will be automatically enrolled for a minimal level of coverage for yourself only under certain of the available benefit coverages.

Retirement Plan:  You will participate in the Retirement Plan for Salaried Employees of MSD. This is a defined benefit pension plan that uses a cash balance formula to calculate your benefit. Your benefit is expressed as a notional account balance that grows with annual pay credits from Merck (from 4.5% to 10.0% of total pay based on age and service) plus interest.

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Robert M. Davis
March 17, 2014
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Pension Make-Whole:  Subject to the conditions set forth below, you will be eligible to receive a cash payment in the amount of $2,000,000, less applicable payroll deductions and withholdings, within 90 days of the termination of your employment at MSD or a Merck subsidiary, provided that the termination of your employment occurs on or after the tenth anniversary of your employment start date with MSD for reasons other than Cause and provided further that you have experienced no breaks in service with MSD or a Merck subsidiary between your start date and the termination of your employment. 

Savings Plan: You will be eligible to participate in the Merck U.S. Savings Plan.  The savings plan includes before- and after-tax savings options and company matching contributions of $0.75 for every $1.00 you contribute; up to 6% of total pay per pay period (maximum match is 4.5% of total pay, subject to plan limits).  If you do not make an active election within 60 days of your hire date, you will be automatically enrolled for Before-Tax Base Pay Contribution of 6% and the Annual Increase Program of 1% (up to a maximum Before-Tax Base Pay Contribution of 10%).

Under the U.S. Retirement Program, the company will provide at least 9.0% and up to 14.5% of your total pay each year (based on age and service) to the Retirement Plan and Savings Plan combined, provided you contribute at least 6% to the Savings Plan. 

More information regarding the Retirement Plan and Savings Plan will be available after your Start Date.

Deferral Program:   Starting in 2015, you will be eligible to defer (1) a portion of your base salary and/or (2) all or part of your EIP bonus, if any.  Eligible employees will receive information about enrollment in the deferral program for 2015 compensation in November 2014. In addition, beginning in 2015, you will be eligible to receive a Company contribution equal to 4.5% of your eligible pay in excess of the applicable IRS limit (currently $260,000 for 2014) as described under the Savings Plan section above.

Financial Planning:  You will be eligible to participate, on a voluntary basis, in the executive financial planning program as applicable to similarly situated employees of MSD.  Under the program, you will be eligible for reimbursement up to $10,000 per calendar year for certain financial and tax planning services and can use any provider of your choice except PricewaterhouseCoopers, the Company's independent auditor.  Reimbursement will be handled directly by the Company to your provider.  Amounts paid by the Company on your behalf for services covered under this program are considered taxable income and will result in imputed income which will be reflected on your W-2 and will result in withholdings from a future paycheck.  You will be provided more information about this program shortly after your start date. 

Vacation and Paid Holiday Policy: Your vacation benefit will be 27 days annually, in accordance with current Merck policy. In addition to your vacation benefit, Merck policy currently provides 9 fixed holidays and 4 Year-End Shutdown days.  The number of vacation days for which you are eligible in your first year of employment is dependent upon your date of hire.   If you are required to work on a Year-End Shutdown Day, you will be provided an alternate paid day off either to be taken at your discretion (with manager approval) or based on your site-specific holiday or shutdown schedule, if applicable.

Relocation

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Robert M. Davis
March 17, 2014
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Domestic Relocation:  You will be eligible for benefits under Merck’s current Relocation Program. As part of our standard relocation benefits, the Company will reimburse you for certain reasonable expenses associated with your move in accordance to Merck's Relocation Policy. Please contact our relocation administrator, Brookfield Relocation at 1-800-516-2352 to obtain detailed information regarding the relocation policy. A relocation counselor will contact you to explain your specific benefits and answer any questions you may have.  In addition to the Standard Relocation Program benefits, you are entitled to the following exceptions:

		
	•
	two trips per month for six months between NJ and IL residence, via first class air travel (maximum twelve trips)

		
	•
	additional four months of temporary lodging (maximum of six months)

Employment Terms and Conditions 

Your employment at MSD and/or Merck will be employment at will.  This means that you will not be employed for any specific duration.  Rather, MSD and/or Merck and you remain free to end the employment relationship at any time, for any lawful reason, either with or without prior notice.  

In addition, your employment will be subject to Merck’s terms and conditions of employment applicable to all employees of Merck.  You will be presented with a copy of these terms and conditions for signature on or about your Start Date.  A courtesy copy of the terms and conditions will be provided for your prior review upon request. 

Change in Control Plan

Merck has adopted a “Change in Control” (CIC) Plan.  The Merck CIC Plan specifies the types of compensation and benefits-related protections to be provided to participants in the event of a change in control.  In accordance with the terms of the current plan, you will be protected from significant adverse changes to most compensation and benefit plans in place at the time of a change in control of Merck for a two-year period after the event.

Right to Amend or Terminate Plans, Programs and Policies

Some of the compensation and benefits described in this letter are provided under and subject to the terms and conditions of the applicable Merck or MSD plans, programs and policies.  Nothing in this letter in any way limits Merck’s or MSD’s right to amend or terminate those plans, programs or policies; however, the promises made to you regarding the provision and amount of base salary, performance year 2014 EIP bonus target, Sign-on Bonus, Sign-on Grant, and financial planning described herein will be honored.

Representations

This offer is made to you based upon your representations that (i) your employment at MSD will not conflict with, or result in the breach of or violation of, any other agreement, instrument, order, judgment or decree to which you are a party or by which you are bound, and (ii) you are not a party to or bound by any employment agreement, non-compete agreement or confidentiality agreement with any other person or entity that would restrict your employment at MSD.  

By your signature below, you affirm that these representations are true.  

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Robert M. Davis
March 17, 2014
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Contingencies

This offer is contingent upon your successful completion of a pre-placement drug screen, satisfactory verification of your employment, education, criminal check and background check results and proof of your eligibility to work in the United States.  (A List of Acceptable Documents that establish your eligibility to work in the U.S., which you are required to bring with you on your first day of work, will be forwarded to you upon your acceptance of the offer).  

Acceptance

Please call Mirian Graddick-Weir at 908-423-1000 upon receipt of this letter to acknowledge your acceptance of this offer and to begin your “on boarding” process for employment.  Renae Morris will be your point of contact throughout the "on boarding" process and will confirm your start date upon successful completion of the above contingencies.  Renae can be reached at 908-423-1000.  

If you choose to accept our offer, please sign this letter and return via facsimile to Annette DeRose on March 24, 2014.

With your abilities and experience, I know you will contribute to and benefit from the growth of Merck.  

Very truly yours,

/s/ Kenneth C. Frazier
Chairman, President, and CEO

I accept the employment offer and its terms contained in this letter.

________________________________        ________________________
Robert M. Davis                Date 

cc:    Renae Morris
Meredith Kraus
Dan Mulville
Mirian Graddick-Weir
Relocation USA
    
    

6mrswenonempagmt.htm

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”), made and entered into as of March 26, 2014 and effective as of April 1, 2014, is by and between NICHOLAS J. SWENSON, an individual resident of Minnesota (“Employee”), and AIR T, INC., a Delaware corporation, with its principal office located in Maiden, North Carolina (the “Company”).

 

 

Background Statement

 

On October 30, 2013, Employee was appointed to serve as interim Chief Executive Officer and President of the Company, and on February 10, 2014 Employee was appointed to serve as Chief Executive Officer and President of the Company.  Since his appointment, Employee has served in these capacities without compensation, other than fees paid to him in his capacity as a director of the Company.  The parties are entering into this Agreement to set forth certain terms of employment which will be effective as of April 1, 2014.

 

IN CONSIDERATION of the promises and the mutual covenants contained herein, the parties hereto agree as follows:

 

Employment.  Subject to the terms and conditions stated herein, and in consideration of Employee’s obligations and covenants, including without limitation, those obligations and covenants set forth in Paragraphs 6 and 7 hereof, the Company agrees to employ Employee, and Employee accepts such employment, as President and Chief Executive Officer of the Company, subject to the order, supervision and direction of the Board of Directors of the Company.

 

Duties.  Employee shall serve the Company as President and Chief Executive Officer and shall devote sufficient business time, as well as his skill and best efforts, to the business of the Company and faithfully perform such executive and supervisory duties as may be prescribed by the Company’s Board of Directors; it being recognized by the Company that Employee shall not be required to devote his full business time to the business of the Company, that he presently serves as Chairman of the Board of an unrelated public company and serves as an officer of several unaffiliated operating businesses, including investment management firms and investment funds, and is expected to pursue outside business interests.  Employee shall act at all times in compliance, in all material respects, with all policies, rules and decisions adopted from time to time by the Company’s Board of Directors.

 

No Term of Employment.  Employee acknowledges that he is an employee at will and that his employment by the Company may be terminated at any time, without prior notice, by the Company for any or no reason.

 

Compensation.

 

The annual compensation to be paid to Employee for the services to be rendered hereunder during the term of his employment hereunder, except to the extent it may be increased from time to time by the Board of Directors of the Company or an authorized committee thereof, shall be $50,000, payable in accordance with the Company’s normal payroll practices, subject to applicable federal and state income and social security and other tax withholding requirements.  Employee acknowledges that he is not entitled to any compensation with respect to his service as interim President and Chief Executive Officer and President and Chief Executive Officer with respect to any period commencing prior to April 1, 2014.  Employee shall not be entitled to any bonus or equity awards.  Employee acknowledges that, for so long as he is employed by the Company and consistent with a policy recently adopted by the Board of Directors, he shall not be entitled to receive any compensation from the Company with respect to his service as a director.

 

 

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No Participation in Employee Benefit Plans.  Employee declines participation in any other employee benefit plan or program of the Company to the extent his exclusion is permitted by law and the terms of such plan or program.

 

Reimbursement of Expenses.  The Company shall pay or reimburse Employee for all reasonable travel and other expenses incurred by Employee in connection with service as an employee of the Company in accordance with the Company’s expense reimbursement policies as established and changed from time to time.

 

Indemnification.  Employee shall have rights to indemnification by the Company as set forth in Article VIII of the Company’s bylaws in effect on the date hereof, which Article VIII is attached hereto as Exhibit A and the terms of which are incorporated into this Agreement.  Any subsequent modification of such provisions of the Company’s bylaws which impair any rights of Employee shall not affect Employee’s rights hereunder.

 

Confidentiality.  Employee acknowledges that during Employee’s employment with the Company Employee will acquire, be exposed to and have access to, material, data and information of the Company and/or its customers or clients that is confidential, proprietary, and/or a trade secret.  At all times, both during and after the termination of employment, Employee shall keep and retain in confidence and shall not disclose, except as required in the course of Employee’s employment with the Company, to any person, firm or corporation, or use for his own purposes, any of this proprietary, confidential or trade secret information.  For purposes of this paragraph, such information shall include, but shall not be limited to: operating methods, information concerning customers, advertising methods, financial affairs or methods of procurement, marketing and business plans, strategies, projections, business opportunities, client lists, sales and cost information and financial results and performance. Employee acknowledges that the obligations pertaining to the confidentiality and non-disclosure of information shall remain in effect for a period of five (5) years, or until the Company has released any such information into the public domain, in which case Employee’s obligation hereunder shall cease with respect only to such information so released.

 

Non-Competition Agreement.  So long as Employee is employed by the Company and for a period of fifty-two (52) weeks following termination of Employee’s employment (such period not to include any period(s) of violation or period(s) of time required for litigation to enforce the covenants herein, as discussed below), whether such termination is voluntary or involuntary on the part of Employee and whether such termination is with or without Cause, Employee shall not:

 

 

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Become employed by (as an officer, director, employee, consultant or otherwise), or otherwise become commercially interested in or affiliated with (whether through direct, indirect, actual or beneficial ownership or through a financial interest), a COMPETITOR, unless Employee accepts employment with a COMPETITOR in an area of the COMPETITOR’S business which does not compete with the Company.  For purposes of this Agreement, a COMPETITOR shall be defined as any person, firm, business or entity (including any sole proprietorship of Employee) that (a) provides airfreight services to (i) FedEx Corporation, (ii) any subsidiaries or affiliates of FedEx Corporation or (iii) any express delivery company to which the Company provided airfreight services within one year prior to the termination of Employee’s employment, (b) manufactures or sells mobile or fixed-stand aircraft de-icing equipment or scissor-lift vehicles used in servicing or supplying aircraft, or (c) provides maintenance services for airport ground support equipment or airport maintenance services (not including aircraft maintenance services).

 

Solicit or attempt to solicit, for competitive purposes, the business of any of the Company’s clients or customers or otherwise induce such customers or clients to reduce, terminate, or restrict or alter their business relationships with the Company in any fashion.

 

Induce or attempt to induce any employee of the Company to leave the Company for the purpose of engaging in a business operation that is competitive with the Company’s business operations.

 

In recognition of the broad geographic scope of the Company’s business and to provide competitive services throughout the United States, and of the ease of competing with that business in any part of the United States, the restrictions on competition set forth herein are intended to cover competitive services that operate in (i) Massachusetts, New York, New Jersey, Pennsylvania, Ohio, Indiana, Illinois, West Virginia, Maryland, Kentucky, North Carolina, South Carolina, Georgia, Tennessee, Alabama or Florida, or (ii) Virginia, Mississippi, the District of Columbia, Delaware, Connecticut, Rhode Island, New Hampshire, Vermont or Maine, or (iii) any state of the continental United States not listed above that is located east of the Mississippi River, or (iv) Missouri or any other state of the continental United States located west of the Mississippi River, or (v) Alaska.  Provided, however, that the Company shall have the right to limit, unilaterally, the scope of any provision of this Agreement to ensure the enforceability of Employee’s agreement not to compete with the Company.

 

The 52-week period of restriction noted above shall be tolled and shall not run during any time that either (i) Employee is in violation of this Paragraph 7 or (ii) the Company is required to engage in litigation to enforce the provisions of this Paragraph 7, it being the intent of the parties that the Company is entitled to 52 weeks free of competition and/or litigation to enforce the provisions hereof.  For clarity, it is the intention of the parties that — in the event of litigation needed to enforce the covenants set forth herein — the 52-week period set forth above will run from the later of (i) the date of the entry of any preliminary injunction enforcing these covenants or (i) in the event of an appeal of a preliminary injunction in connection with which preliminary injunctive relief is stayed or otherwise abated, the date of any final appellate judgment affirming the grant of such preliminary injunction or otherwise ordering the granting or reinstatement of such preliminary injunctive relief.  In the event of any violation of the terms of any temporary restraining order or preliminary injunctive order entered to enforce the covenants of this Paragraph 7, the 52-week period will restart, so as to reflect the intention expressed herein.

 

 

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Company’s Right to Obtain an Injunction.  Employee acknowledges that the Company will have no adequate means of protecting its rights under Paragraphs 6 and 7 of this Agreement other than by securing an injunction (a court order prohibiting Employee from violating the Agreement).  Accordingly, Employee agrees that the Company is entitled to enforce this Agreement by obtaining a preliminary and permanent injunction and any other appropriate equitable relief.  Nothing contained in this paragraph, however, shall prohibit the Company from pursuing any remedies in addition to injunctive relief, including recovery of damages.

 

Condition to Seeking Subsequent Employment.  Employee agrees to show a copy of this Agreement to any COMPETITOR with whom Employee interviews during Employee’s employment with the Company or with whom Employee interviews within one (1) years following the effective date of the termination of Employee’s employment with the Company.

 

General Provisions.

 

Entire Agreement.  This Agreement contains the entire understanding between the parties hereto relating to the employment of Employee by the Company and supersedes any and all prior employment or compensation agreements between the Company and Employee.

 

Severability.  If any provision contained in this Agreement shall for any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement but this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

 

Assignment.  Neither this Agreement nor any right or interest hereunder shall be assignable by Employee, Employee’s beneficiaries or legal representatives, without the prior written consent of the Company; provided, however, that nothing shall preclude (i) Employee from designating a beneficiary to receive any benefit payable upon Employee’s death, or (ii) the executors, administrators or other legal representatives of Employee or Employee estate from assigning any rights hereunder to the person or persons entitled thereunto.  The Company may transfer or assign its rights and interest in this Agreement to any person, proprietorship, partnership, limited liability company or corporation that acquires or succeeds to at least a majority of the equity, assets, accounts or other business of the Company.

 

Binding Agreement.  This Agreement shall be binding upon, and inure to the benefit of, Employee and the Company and their respective permitted successors and assigns.

 

Amendment or Modification of Agreement.  This Agreement may not be modified or amended except by an instrument in writing signed by the parties hereto.

 

Waiver.  No delay or omission by either party hereto in exercising any right, power or privilege hereunder shall impair such right, power or privilege, nor shall any single or partial exercise of any right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privilege.  The provisions of this Paragraph 11(f) cannot be waived except in writing signed by both parties.

 

 

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Governing Law and Forum Selection.  This Agreement shall be construed in accordance with and governed by the substantive laws of the State of North Carolina, without regard to conflict of laws principles.  Furthermore, in exchange for the consideration set forth herein, Employee agrees that any claim against the Company (i) for the breach or invalidity of any provision of this Agreement; (ii) arising out of or relating to the employment of Employee with the Company or (iii) encompassed within or related to any claim to be released as provided in Paragraph 6 herein, shall be brought exclusively in the Superior Court of Lincoln County, North Carolina, or the United States District Court for the Western District of North Carolina, and in no other forum.  Employee hereby consents to the personal and subject matter jurisdiction of these courts for the purpose of adjudicating any claims subject to this forum selection clause.  Employee also agrees that any dispute of any kind arising out of or relating to this Agreement or to Employee’s employment with the Company shall at the Company’s sole election be submitted to arbitration before the American Arbitration Association in Mecklenburg County, North Carolina, which election may be made by the Company at any time prior to the last day to answer and/or respond to a summons and/or complaint or counterclaim, crossclaim or third-party claim made by Employee.  The provisions of the North Carolina Uniform Arbitration Act, N.C. Gen. Stat. § 1-567.1 et seq. shall apply to the arbitration of disputes hereunder unless such provisions are preempted by the Federal Arbitration Act.

 

Notices.  Any notice, offer, acceptance or other document required or permitted to be given pursuant to any provisions of this Agreement shall be in writing, signed by or on behalf of the person giving the same, and (as elected by the person giving such notice) delivered by hand or mailed to the parties at the following addresses by registered or certified mail, postage prepaid, return receipt requested, or by a third party company or governmental entity providing delivery services in the ordinary course of business, which guarantees delivery on a specified date:

 

	
  

	
If to Employee:

	
Nick Swenson

	
  

	
3524 Airport Road

	
  

	
Maiden, North Carolina 28650

	
  

	
Attention: Tara Hedrick

If to the Company:                Air T, Inc.

3524 Airport Road

Maiden, North Carolina 28650

Attention:  Secretary

 

or to such other address as any party hereto may designate by complying with the provisions of this Paragraph 11.

 

Such notice shall be deemed given (i) as of the date of written acknowledgment by Employee or an officer of the Company if delivered by hand, (ii) seventy-two (72) hours after deposit in United States mail if sent by registered or certified mail or (iii) on the delivery date guaranteed by the third party delivery service if sent by such service.

 

Rejection or other refusal to accept or inability to deliver because of changed address of which no notice has been received shall not affect the date upon which the notice is deemed to have been given pursuant hereto.  Notwithstanding the foregoing, no notice of change of address shall be effective until the date of receipt hereof.

 

 

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Effective Date.  This Agreement shall be effective as of April 1, 2014.

 

[signature page follows]

 

	
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IN WITNESS WHEREOF, Employee has executed this Agreement and the Company has caused this Agreement to be executed in its name by its duly authorized officer as of the day and year first above written.

EMPLOYEE:

  /s/ Nick Swenson                                                                           

Nick Swenson

COMPANY:

AIR T, INC.

By:             /s/ John Parry                                                                

	
  

	
Title:

	
Vice President-Finance, Chief Financial Officer and Secretary

 

	
 

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Exhibit A

ARTICLE VIII

INDEMNIFICATION

Section 1.  Each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”), by reason of the fact that he or she is or was a director, officer, or employee of the corporation or is or was serving at the request of the corporation as a director, officer, manager or employee of a subsidiary or other affiliate of the corporation or of another corporation, association, limited liability company, partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter an “indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, manager, employee or agent or in any other capacity while serving as a director, officer, manager, or employee or agent, shall be vested with the contractual right to indemnification and be held harmless by the corporation to the fullest extent authorized by the Delaware General Corporation Law , as the same exists or may hereafter be amended (the “DGCL”), against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith if the indemnitee acted in good faith and in a manner the indemnitee reasonably believed to be in or not opposed to the best interest of the corporation or other entity covered by this Article VIII, and, with respect to any criminal action or proceeding, had no reasonable cause to believe that such indemnitee’s conduct was unlawful; provided, however, that, the corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the board of directors of the corporation.

Section 2.  The right to indemnification conferred in this Article shall include the right to be paid by the corporation the expenses incurred in defending any proceeding for which such right to indemnification is applicable in advance of its final disposition (hereinafter an “advancement of expenses”); provided, however, that an advancement of expenses incurred by an indemnitee shall be made only upon delivery to the corporation of an undertaking (hereinafter an “Undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under this Section or otherwise.

Section 3.  The rights to indemnification and to the advancement of expenses conferred in this Article shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, the corporation’s certificate of incorporation, by-laws, agreement, vote of stockholders or disinterested directors or otherwise.

 

 

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Section 4.  The corporation may maintain insurance, at its expense, to protect itself and any director, officer, or employee of the corporation or any person serving at the request of the corporation as a director, officer, manager, employee or agent of another corporation, association, limited liability company, partnership, joint venture, trust or other enterprise, against any expense, liability or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability or loss under the DGCL.

Section 5.  The corporation may, to the extent authorized from time to time by the board of directors, grant rights to indemnification, and to the advancement of expenses to any agent of the corporation to the fullest extent of the provisions of this Article VIII with respect to the indemnification and advancement of expenses of directors, officers and employees of the Corporation.

Section 6.  The rights to indemnification and to the advancement of expenses conferred in this Article VIII are contract rights.  Such rights to indemnification and to advancement of expenses shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee’s heirs, executors and administrators.  Any repeal or modification of the provisions of this Article shall not adversely affect any right or protection hereunder of any person in respect of any act, omissions, facts or circumstances occurring prior to the time of such repeal or modification.

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