WORLDCORP/XXXXXXX XXXXXXX
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made as of the 1st day of October,
1997, by and between WORLDCORP, INC., a Delaware corporation, its successor and
assigns ("WorldCorp") and X. XXXXXXX XXXXXXX, III ("Xxxxxxx").
RECITALS
WHEREAS, Xxxxxxx has served as WorldCorp's Chairman and/or Chief Executive
Officer since June 1987.
WHEREAS, WorldCorp desires to continue to employ and retain Xxxxxxx as its
Chairman and Xxxxxxx desires to be employed by WorldCorp on the terms and in
consideration of WorldCorp's provision of the benefits to be provided under this
Agreement.
WHEREAS, WorldCorp and Xxxxxxx desire to set forth the terms of Xxxxxxx'
employment and the compensation and benefits to be provided by WorldCorp in this
Agreement.
TERMS
IN CONSIDERATION OF the mutual covenants contained herein, WorldCorp and Xxxxxxx
agree as follows:
1. EMPLOYMENT. WorldCorp agrees to employ Xxxxxxx and Xxxxxxx agrees to
continue in the employ of WorldCorp on the terms and conditions hereinafter set
forth.
2. COMMENCEMENT DATE AND TERM. The commencement date of this Agreement
shall be as of October 1, 1997 (the "Commencement Date"). Subject to the
provisions of Section 5, the term of Xxxxxxx' employment hereunder shall be for
two (2) years from the Commencement Date until and including September 30, 1999
(the "Original Expiration Date"); provided, however, that the term shall be
extended automatically for an additional period of one (1) year commencing on
the Original Expiration Date unless either WorldCorp or Xxxxxxx gives written
notice to the other, at least twelve (12) months prior to the Original
Expiration Date, of its or his election not to extend the term of this
Agreement; and provided, further, that the term as extended shall be further
extended automatically for an additional period of one (1) year commencing on
the first anniversary of the Original Expiration Date and on each subsequent
anniversary thereafter, unless either WorldCorp or Xxxxxxx gives written notice
to the other, at least six (6) months prior to the date of any such anniversary,
of its or his election not to further extend the term of this Agreement. The
last day of the term as so extended from time to time is herein sometimes
referred to as the "Expiration Date."
3. POSITIONS AND DUTIES. Xxxxxxx shall continue to serve WorldCorp as
WorldCorp's Chairman with the duties described in WorldCorp's Bylaws, as in
effect on the Commencement Date, and in the attached Exhibit A to this
Agreement, and such other duties as WorldCorp's Board of Directors (the "Board")
shall reasonably assign from time to time. During his employment hereunder,
Xxxxxxx shall devote such time and effort as shall be reasonably required to
discharge his duties hereunder. At all times during his employment hereunder,
Xxxxxxx shall continue to serve as a member of the Board, and Xxxxxxx may also
serve as a member of the board of directors or similar body of, or in other
offices or positions with respect to, any other company or companies that are
not direct commercial competitors of WorldCorp. Xxxxxxx agrees to resign from
the Board of Directors of WorldCorp upon and in connection with the termination
of his employment, provided that all of the terms of this Agreement have been
satisfied and all of WorldCorp's obligations hereunder have been fulfilled.
4. COMPENSATION AND BENEFITS. The compensation and benefits payable to
Xxxxxxx for all services rendered by Xxxxxxx under this Agreement shall be as
follows:
(a) SALARY. WorldCorp shall pay Xxxxxxx a minimum salary at the rate of
$200,000 per year. Such salary shall be (i) payable quarterly in advance on the
first day of each fiscal quarter of WorldCorp (and prorated for any partial
fiscal quarter), and (ii) subject to review and increase (but not decrease) at
any time in the discretion of the Board.
(b) ANNUAL BONUS. Xxxxxxx shall be entitled to receive an annual bonus of
up to 75% of his annual salary to be determined in good faith by the
Compensation Committee of WorldCorp's Board of Directors based upon Andrew's
contributions to WorldCorp's performance. Such bonus shall be paid not later
than 30 days after receipt of audited financials from WorldCorp's accounting
firm for the prior year. Xxxxxxx shall be entitled to participate in all bonus
and incentive compensation plans or arrangements provided by WorldCorp to its
officers and directors after the Commencement Date.
(c) BUSINESS EXPENSES. In addition to any salary and bonus, WorldCorp shall
xxxx xxxxx Xxxxxxx for all reasonable travel and other business expenses
incurred by him in the performance of his duties and responsibilities, subject
to and consistent with WorldCorp's policies with respect to substantiation and
documentation as may be established by WorldCorp for all officers and directors
from time to time.
(d) STOCK OPTIONS. In exchange for surrendering 200,000 unvested WorldCorp
options at an exercise price of $4.50, Xxxxxxx shall be granted:
1) Options (the "WorldCorp Term Options") to purchase 50,000 shares of
WorldCorp's Common Stock, par value $.001 per share ("WorldCorp Common Stock")
pursuant to the 1995 WorldCorp Airways Stock Option Plan (the "Plan"), at an
exercise price of $2.00 per share, as set forth in that certain Stock Option
Agreement between WorldCorp and Xxxxxxx of even date herewith (the "Option
Agreement"), a copy of which is attached as Exhibit B hereto.
2) Options (the "Intelidata Term Options") to purchase 50,000 shares of
Intelidata's Common Stock, par value $.001 per share ("InteliData Common Stock")
owned by WorldCorp, at an exercise price of $3.00 per share.
3) Options to purchase 75,000 shares of WorldCorp's Common Stock, (the
"WorldCorp Performance Options") subject to the following vesting:
(i) the Option as to the first 15,000 of the 75,000 WorldCorp Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $2.50;
(ii) the Option as to the second 15,000 of the 75,000 WorldCorp Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $3.13;
(iii) the Option as to the third 15,000 of the 75,000 WorldCorp Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $3.91;
(iv) the Option as to the fourth 15,000 of the 75,000 WorldCorp Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $4.88;
(v) the Option as to the fifth 15,000 of the 75,000 WorldCorp Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $6.10.
4) Options to purchase 75,000 shares of InteliData's Common Stock, (the
"InteliData Performance Options") subject to the following vesting: . (i) the
Option as to the first 15,000 of the 75,000 InteliData Performance Op tions at
an exercise price of $3.00 shall vest on the 21st day following any twenty (20)
trading-day pe riod during which the Company's stock traded at or above $3.75;
(ii) the Option as to the second 15,000 of the 75,000 InteliData
Performance Options at an exercise price of $3.00 shall vest on the 21st day
following any twenty (20) trading-day period during which the Company's stock
traded at or above $4.69;
(iii) the Option as to the third 15,000 of the 75,000 InteliData
Performance Options at an exercise price of $3.00 shall vest on the 21st day
following any twenty (20) trading-day period during which the Company's stock
traded at or above $5.86;
(iv) the Option as to the fourth 15,000 of the 75,000 InteliData
Performance Options at an exercise price of $2.00 shall vest on the 21st day
following any twenty (20) trading-day period during which the Company's stock
traded at or above $7.32;
(v) the Option as to the fifth 15,000 of the 75,000 InteliData Performance
Options at an exercise price of $2.00 shall vest on the 21st day following any
twenty (20) trading-day period during which the Company's stock traded at or
above $9.16.
WorldCorp agrees that each option agreement with respect to options to
purchase Common Stock granted prior to the date hereof shall be amended such
that (i) the definition of "Change in Con trol" for purposes of any such
agreements and options shall have the meaning assigned to such term in the
Option Agreement, and (ii) all terms and conditions of such options (other than
exercise price, vesting and term absent acceleration) shall be as set forth in
the Option Agreement.
(e) REGULAR BENEFITS. WorldCorp shall reimburse Xxxxxxx on an annual basis,
from October 1, 1997 through September 30, 2000, for the premiums paid by
Xxxxxxx with respect to a $5,000,000 term life insurance policy (which policy
shall be owned by Xxxxxxx), plus an amount suf ficient to pay all federal, state
and local taxes applicable to such payment.
Xxxxxxx shall be owner of and shall enjoy all incidents of ownership of
such policy, including without limitation the right to designate one or more
beneficiaries of, and to assign the ownership of, such policy from time to time.
If any benefits to which Xxxxxxx shall otherwise be entitled hereunder are not
permitted to be provided to him under any applicable plan document or applicable
law govern ing the payment or provision of such benefits, WorldCorp shall pay or
provide for payment of equiva lent benefits, taking into account service credits
for such benefits, to Xxxxxxx or his estate or benefi ciaries.
(f) FRINGE BENEFITS. WorldCorp agrees that each option agreement with
respect to options to purchase Common Stock granted prior to the date hereof
shall be amended such that (i) the definition of "Change in Control" for
purposes of any such agreements and options shall have the meaning assigned to
such term in the Option Agreement, and (ii) all terms and conditions of such op
tions (other than exercise price, vesting and term absent acceleration) shall be
as set forth in the Option Agreement.
WorldCorp shall reimburse Xxxxxxx on an annual basis for premiums paid by
Xxxxxxx with respect to a disability policy selected by Xxxxxxx providing for
benefits of up to 75% of Xxxxxxx' average annual compensation (calculated in
accordance with the terms of such policy), plus an amount sufficient to pay all
federal, state and local taxes applicable to such payment.
(g) INDEMNIFICATION; DIRECTORS AND OFFICERS LIABILITY INSURANCE. WorldCorp
shall provide or cause to be provided to Xxxxxxx indemnification against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement in connection with any threatened, pending or completed action,
claim, suit or proceeding, whether civil, criminal, administrative or
investigative (in cluding an action by or in the right of WorldCorp) by reason
of Xxxxxxx serving or having served as an officer, director or employee of
WorldCorp or any affiliate of WorldCorp. WorldCorp shall advance expenses
(including attorneys' fees) incurred by Xxxxxxx in the defense of any such
action, claim, suit or proceeding, and WorldCorp shall maintain directors and
officers liability insurance cov erage (including without limitation coverage
for claims pursuant to any state or federal securities law or regulation) upon
substantially the same terms and conditions as set forth in the Indemnification
Agreement dated as of February 28, 1994 between Xxxxxxx and WorldCorp, Inc., a
copy of which is attached as Exhibit D to this Agreement. The provisions of this
Section 4(f) are intended to supple ment and to be in addition to, and not to be
in lieu of, any rights of Xxxxxxx granted to WorldCorp's officers and directors
under WorldCorp's charter, articles of incorporation, any other corporate docu
ment, or applicable law.
(h) SUPPLEMENTAL RETIREMENT BENEFITS. As soon as practicable after the
Commence ment Date, WorldCorp and Xxxxxxx agree to negotiate and enter into a
Supplemental Executive Re tirement Plan ("SERP") pursuant to which WorldCorp
shall be obligated to pay to Xxxxxxx, or one or more beneficiaries to be
designated by Xxxxxxx from time to time pursuant to the SERP, an annual benefit
of at least $30,000 commencing upon the earliest to occur of (i) the date on
which Xxxxxxx attains the age of 55 years, or (ii) the date of Xxxxxxx' death or
disability, with such payments continu ing thereafter during Xxxxxxx' lifetime
up to age 80, but in no case exceeding 25 years of benefits. The SERP and
WorldCorp's obligations thereunder shall be funded through the use of either a
"rabbi trust" or "secular trust," as requested by Xxxxxxx, and shall have such
other terms and conditions as may be reasonably required to secure WorldCorp's
payment obligations thereunder and defer Xxxxxxx' recognition of taxable income
until payments are received. WorldCorp shall fund one-half (1/2) of its
obligation hereunder as of January 2, 1998 and the remaining one-half (1/2) as
of January 2, 1999, provided that, if requested by Xxxxxxx, the SERP shall
otherwise be unfunded for purposes of income taxation to Xxxxxxx. WorldCorp and
Xxxxxxx agree to negotiate in good faith toward the final execution of the SERP
and related legal documents.
As an alternative to and in lieu of the SERP, Xxxxxxx may elect to apply
the present value of the SERP to a dollar-for dollar reduction in the loan
payments due to WorldCorp by Xxxxxxx in Febru ary 1998, 1999, 2000, and 2001,
respectively.
(I) SUPPLEMENTAL INCENTIVE COMPENSATION FROM 1989 The remaining and final
payment due to Xxxxxxx on January 2, 1998 of $655,365 will be made on that date.
5. TERMINATION AND TERMINATION BENEFITS. Notwithstanding the provisions of
Section 2 of this Agreement, Xxxxxxx' employment hereunder shall terminate under
the following circumstances and shall be subject to the following provisions:
(a) DEATH. In the event of Xxxxxxx' death during Xxxxxxx' employment
hereunder, Xxxxxxx' employment shall terminate on the date of his death.
Notwithstanding such termination, Xxxxxxx' estate or designated beneficiaries
shall be entitled to receive (i) the salary specified under Section 4(a) above
for a period of one (1) month following the date of death, (ii) any accrued
portion of any bonus which is ultimately determined to have been payable to
Xxxxxxx and allocable to the period prior to death, (iii) any benefits which
shall have been provided to Xxxxxxx under Section 4 to the ex tent permitted
under any applicable plan documents, and (iv) any amounts payable to Xxxxxxx'
estate or designated beneficiaries under the SERP.
(b) DISABILITY. If, due to any physical or mental illness, condition,
dependency or incapacity (hereafter, "disability"), Xxxxxxx shall be unable to
adequately perform substantially all of his duties and responsibilities
hereunder, and provided such disability continues for an uninterrupted period of
at least twelve (12) months, (a) Xxxxxxx' employment hereunder shall be deemed
terminated as of the end of the relevant period of disability or, if later, the
final determination of such disability, and (b) WorldCorp, acting through its
Board and at any time prior to the expiration of any relevant pe riod of
disability and the final determination of such disability, may designate another
executive to act in Xxxxxxx' place during the period of such disability. In the
event of any dispute as to whether An xxxxx has suffered a disability justifying
termination, such dispute shall be resolved at WorldCorp's cost by a panel of
three physicians, one designated by Xxxxxxx, one designated by WorldCorp, and a
third designated by the first two panel members. Notwithstanding any termination
of Xxxxxxx' em ployment under this Section 5(b), WorldCorp shall continue to pay
to Xxxxxxx his full salary and ben efits under Section 4 of this Agreement until
Xxxxxxx becomes eligible for disability income payments under WorldCorp's
disability income plan. While receiving disability income payments un der such
plan, WorldCorp shall continue to pay to Xxxxxxx the difference between such
disability in come payments and his salary under Section 4 until the Expiration
Date (but not any bonus, except as accrued through the date of determination of
disability). Notwithstanding the termination of Xxxxxxx' employment hereunder,
Xxxxxxx shall be entitled to continue participation in all medical and other
benefit plans provided for under Section 4 for a period of time following such
termination equal in length to the period of Xxxxxxx' employment with WorldCorp
(commencing on September 4, 1986 and ending on the termination date). If any
benefits to which Xxxxxxx shall otherwise be entitled here under are not
permitted to be provided to him under any applicable plan document or applicable
law governing the payment or provision of such benefits, WorldCorp shall pay or
provide for payment of equivalent benefits, taking into account service credits
for such benefits, to Xxxxxxx or his estate or beneficiaries.
(c) TERMINATION BY WORLDCORP FOR CAUSE. Subject to the provisions of this
Section 5(c), Xxxxxxx' employment hereunder may be terminated by WorldCorp for
Cause. If the Board de termines by the majority vote of its entire membership
that Xxxxxxx should be terminated for Cause, the Board shall send written notice
to Xxxxxxx setting forth in reasonable detail the nature of the Cause. No
termination shall become effective under this Section 5(c) until (i) such vote
is obtained and such notice is sent to and received by Xxxxxxx, (ii) following
Xxxxxxx' receipt of such notice, Xxxxxxx has been provided a reasonable
opportunity to meet with the entire Board and discuss the Board's notice to him,
and (iii) following such meeting, the Board ratifies its earlier vote to
terminate Xxxxxxx for Cause by a second vote of a majority of its entire
membership. Only the following shall constitute "Cause" for such termination:
(i) gross negligence, willful misconduct or dishonesty in of fice or breach of a
material fiduciary duty owed to WorldCorp; (ii) conviction of a felony, a crime
of moral turpitude or commission of an act of embezzlement or fraud against
WorldCorp or any affiliate of WorldCorp; (iii) willful failure to perform a
substantial portion of his duties and responsibilities hereunder (unless such
failure results from Xxxxxxx' illness or disability).
(d) TERMINATION BY WORLDCORP WITHOUT CAUSE. Xxxxxxx' employment with
WorldCorp may be terminated by WorldCorp without Cause provided that (i) such
termination is ap proved by the affirmative vote of one-half (1/2) of all
members of the Board, (ii) Xxxxxxx is given at least ninety (90) days' prior
written notice of such termination, and (iii) Xxxxxxx shall be entitled to
receive the benefits described herein and in Section 5(f) below. Notwithstanding
the termination of Xxxxxxx' employment hereunder, Xxxxxxx shall be entitled to
continue participation, on the same terms and conditions previously in place, in
all medical and other benefit plans provided for under Sec tion 4 for a period
following such termination of three years, or until comparable coverage
acceptable to Xxxxxxx is obtained, whichever time period is lesser. If any
benefits to which Xxxxxxx shall other wise be entitled hereunder are not
permitted to be provided to him under any applicable plan document or applicable
law governing the payment or provision of such benefits, WorldCorp shall pay or
provide for payment of equivalent benefits, taking into account service credits
for such benefits, to Xxxxxxx or his estate or beneficiaries.
WorldCorp shall pay to Xxxxxxx an amount equal to the highest incentive
bonus paid to Xxxxxxx for any of the three calendar years immediately preceding
the date of termination, pro rated through his month of departure.
(e) TERMINATION BY XXXXXXX. Xxxxxxx may terminate his employment hereunder
with or without Good Reason (as defined below) by giving the Board at least
thirty (30) days' prior written notice of termination of his employment, and he
shall not be required to render any further ser vices to WorldCorp after the
expiration of such thirty (30)-day period. In the event of termination for Good
Reason, Xxxxxxx shall specify in the notice the event or circumstances
constituting Good Rea son. In the event of termination by Xxxxxxx for Good
Reason, Xxxxxxx shall be entitled to the com pensation and benefits specified
herein and in Section 5(f) below. In the event of termination by An xxxxx
without Good Reason, Xxxxxxx shall be entitled to no further compensation or
benefits under this Agreement other than any salary accrued prior to the
effective date of such termination, the right to retain ownership of the life
insurance policy described in Section 4(e) above. Notwithstanding the ter
mination of Xxxxxxx' employment hereunder, Xxxxxxx shall be entitled to continue
participation in all medical and other benefit plans provided for under Section
4 for a period following such termination equal to the period of Xxxxxxx'
employment with WorldCorp (commencing on September 4, 1986 and ending on the
termination date). If any benefits to which Xxxxxxx shall otherwise be entitled
hereunder are not permitted to be provided to him under any applicable plan
document or applicable law govern ing the payment or provision of such benefits,
WorldCorp shall pay or provide for payment of equiva lent benefits, taking into
account service credits for such benefits, to Xxxxxxx or his estate or benefi
ciaries. Only the following shall constitute "Good Reason" for termination by
Xxxxxxx: (i) the reloca tion of WorldCorp's principal offices or headquarters or
Xxxxxxx' place of employment to a location outside of the Washington, D.C.
Standard Metropolitan Statistical Area; (ii) the failure of Xxxxxxx at any time
to be elected to or to continue to be entitled to serve on the Board; (iii) the
failure of WorldCorp to comply with the provisions of Section 4 of this
Agreement or material breach by WorldCorp of any other provision of this
Agreement, including without limitation WorldCorp's failure to make any payment
under Section 4 within five (5) days of the due date of such payment or
WorldCorp's failure to determine Xxxxxxx' annual bonus in good faith and on a
timely basis; (iv) the material diminishment or material change in the duties,
responsibilities or position of Xxxxxxx, (v) the discontinuation of, diminution
in the benefits payable under, or material adverse amendment or alter ation of,
and whether it impacts all participants or only Xxxxxxx individually, any
compensation, bo nus or benefit plan or arrangement in which Xxxxxxx was
entitled to participate as of the Commence ment Date and which constitutes a
material part of Xxxxxxx' total compensation and benefits, unless an
economically equivalent substitute arrangement or benefit acceptable to Xxxxxxx
is adopted for the benefit of Xxxxxxx; (vi) the sale, acquisition, merger,
consolidation, dissolution, liquidation, reorgani zation or other restructuring
of WorldCorp; or (vii) the occurrence of a Change in Control (as defined in
Section 5(g) below) with respect to WorldCorp.
WorldCorp shall pay to Xxxxxxx an amount equal to the highest incentive
bonus paid to Xxxxxxx for any of the three calendar years immediately preceding
the date of termination pro rated through his month of departure.
(f) ACCELERATION OF SALARY, BONUS AND BENEFITS IF WITHOUT CAUSE OR FOR GOOD
REA SON. In the event of termination by WorldCorp without Cause and other than
for death or disability, or by Xxxxxxx for Good Reason, (i) WorldCorp shall
within five (5) days after the date of termination pay Xxxxxxx, in one lump-sum
payment, the total undiscounted amount of his entire salary and bonus which
would otherwise become due and payable under Sections 4(a) and 4(b) through the
Expiration Date (or, in the case of any bonus not yet determined, such bonus
shall be paid within five (5) days af ter the amount of such bonus is
determined); (ii) any stock options to which Xxxxxxx was or may have become
entitled, whether or not granted or vested as of the date of termination, shall
be immediately granted and become immediately vested and exercisable; and (iii)
the regular benefits described in Sec tion 4(e) shall continue to be provided to
Xxxxxxx at WorldCorp's expense as provided under Sections 5(d) and 5(e). In the
event WorldCorp fails to make any payment or provide any benefit hereunder, the
unpaid amount or value of the benefit will accrue interest at an annual rate
equal to the prime rate charged by WorldCorp's primary depository bank plus 5%,
and Xxxxxxx shall be entitled to reimbursement of all costs, including
reasonable attorneys' fees and costs, incurred by him as a result of any such
nonpayment or any actions to collect the same.
(g) CHANGE IN CONTROL. As used herein, a "Change in Control" shall mean the
occur rence of any of the following events or circumstances subsequent to the
date of this Agreement, it be ing agreed that no circumstance or event occurring
on or before the date of this Agreement shall consti tute a Change in Control:
(i) The acquisition by an individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") other than a trustee or other fiduciary holding
securities under an employee benefit plan of WorldCorp (a "Person"), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more of either the then outstanding shares of common
stock of WorldCorp (the "Outstanding WorldCorp Common Stock") or the combined
voting power of the then outstanding voting securities of WorldCorp entitled to
vote generally in the election of directors (the "Outstanding WorldCorp Voting
Securities");
(ii) There occurs any acquisition, merger or consolidation of WorldCorp,
by, with or into any other corporation (other than a wholly-owned subsidiary of
WorldCorp) and individu als who are directors of WorldCorp immediately prior to
the time the agreement of acquisition, merger or consolidation is executed shall
fail to constitute a majority of the board of directors of the survivor or
successor company at any time after consummation of the transaction; or
(iii) The shareholders of WorldCorp approve a sale or disposition by
WorldCorp of all or substantially all of its assets or a plan of dissolution and
liquidation of WorldCorp.
(h) GROSS-UP FOR EXCISE TAXES. In the event any payment under this Section
5 or otherwise to or for the benefit of Xxxxxxx (determined without regard to
any additional payments re quired under this Section 5(h))(a "Payment") would be
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended, or any interest or penalties are incurred by Xxxxxxx with
respect to such excise tax (collectively, the "Excise Tax"), then Xxxxxxx shall
be enti tled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by Xxxxxxx of all taxes (including income taxes
and interest and penalties imposed with respect to such taxes) and the Excise
Tax imposed on the Gross-Up Payment, Xxxxxxx retains an amount of the Gross- Up
Payment equal to the Excise Tax imposed on the Payments. All determinations
required to be made under this Section 5(h) shall be made by WorldCorp's regular
independent auditors as of the date of termination of Xxxxxxx' employment
hereunder, and all fees and expenses of such auditors shall be borne by
WorldCorp.
(I) After-tax, cash salary payments made to Xxxxxxx under the Change of
Control provision herein will be applied to reduce the remaining loan payments
due, if any, from Xxxxxxx in 1998, 1999, 2000, and 2001, respectively.
6. COMPANY PROPERTY. Upon the termination of Xxxxxxx' employment under this
Agree ment, Xxxxxxx shall be entitled to retain, as his own property, mobile
telephones, notebook computers and related peripherals, other electronic
equipment, furnishings, and other property issued to Xxxxxxx in the course of
his employment.
7. NONCOMPETE AND NONDISPARAGEMENT. For a period of one (1) year following
the date of termination of Xxxxxxx' employment hereunder other than by WorldCorp
without Cause or by Xxxxxxx for Good Reason, Xxxxxxx will not, directly or
indirectly, whether as an owner, partner, shareholder, consultant, agent,
employee, co-venturer or otherwise, or through any other person or en tity,
engage in any business which is competitive with WorldCorp's business.
Each party hereto agrees that during the effectiveness of and following
termination of this Agreement for any reason, it will not make any disparaging
statements, remarks or comments with respect to the remaining party, whether
written or oral.
8. BENEFICIARY. Any payments to which Xxxxxxx is entitled under this
Agreement shall, in the event of his death, be made to his wife or such other
persons as Xxxxxxx shall designate in writing to WorldCorp from time to time. If
no such beneficiaries survive Xxxxxxx, such payments shall be made to Xxxxxxx'
estate.
9. ARBITRATION OF DISPUTES. Any controversy or claim arising out of or
relating to the em ployment relationship between Xxxxxxx and WorldCorp, this
Agreement or any breach thereof shall be settled by arbitration in accordance
with the laws of the Commonwealth of Virginia by three arbitra tors, one of whom
shall be appointed by WorldCorp, one by Xxxxxxx and the third by the first two
ar bitrators. If the first two arbitrators cannot agree on the appointment of a
third arbitrator, then the third arbitrator shall be appointed by the American
Arbitration Association in Washington, D.C. Such arbi tration shall be conducted
in Washington, D.C. in accordance with the rules of the American Arbitra tion
Association. Judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof. The party against whom the arbitrators
shall render an award shall pay the other party's reasonable attorneys' fees and
other reasonable costs and expenses in connection with the enforcement of its
rights under this Agreement (including the enforcement of any arbitration award
in court), unless and to the extent the arbitrators shall determine that under
the circumstances recovery by the prevailing party of all or a part of any such
fees and costs and expenses would be unjust.
10. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither WorldCorp nor Xxxxxxx
may make any assignment of this Agreement or any interest herein, by operation
of law or otherwise, without the prior written consent of the other party;
provided, however, that WorldCorp may assign its rights under this Agreement
without the consent of Xxxxxxx in the event that WorldCorp shall hereafter
effect a reorganization, consolidate with or merge into any other Person, or
transfer all or substantially all of its properties or assets to any other
Person. This Agreement shall inure to the benefit of and be binding upon
WorldCorp and Xxxxxxx, their respective successors, executors, administrators,
heirs and permit xxx assigns. In the event of Xxxxxxx' death prior to the
completion by WorldCorp of all payments due him under this Agreement, WorldCorp
shall continue such payments to Xxxxxxx' beneficiary desig nated in writing to
WorldCorp prior to his death (or to his estate, if he fails to make such
designation).
11. ENFORCEABILITY. If any portion or provision of this Agreement shall to
any extent be de clared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agree ment, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
12. WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subse quent breach.
13. NOTICES. Any notices, request, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid (in which
case notice shall be deemed to have been given on the third day after mailing),
or by overnight delivery by a reliable overnight courier service (in which case
notice shall be deemed to have been given on the day after delivery to such
courier service) to Xxxxxxx at the last ad dress Xxxxxxx has filed in writing
with WorldCorp or, in the case of WorldCorp, at its main offices, attention of
the Board.
14. ENTIRE AGREEMENT; AMENDMENT. This Agreement may be amended or modified
only by a written instrument approved by each of the Board of WorldCorp and the
Compensation Committee thereof, signed by Xxxxxxx and by a duly authorized
representative of WorldCorp. This Agreement, constitutes the entire agreement
between the parties with respect to the subject matter hereof and no agreements
or representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement.
15. GOVERNING LAW. This is a Virginia contract and shall be construed under
and be governed in all respects by the laws of the Commonwealth of Virginia,
without giving effect to the choice of law principles of any state.
IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by WorldCorp, by its duly authorized officer, and by Xxxxxxx, as of the date
first above written.
WORLDCORP, INC.
By:
Title:
Date:
X. XXXXXXX XXXXXXX, III
Date:
Address:
EXHIBIT A
DUTIES AND RESPONSIBILITIES
A. Lead and coordinate the activities of the WorldCorp Airways Board of
Directors related to general corporate governance.
B. Review the strategic and financial progress of the business and, if
appropriate, suggest to the Board strategic or financial issues that warrant
consideration by the Board.
C. Provide leadership, as requested by the CEO of WorldCorp or by the
Board, for major transactions with vendors, financial providers or
customers in situations that warrant such involvement.
