EXHIBIT 10.12(b)(1)
AMENDMENT NUMBER ONE
TO
SEVERANCE AGREEMENT
This Amendment Number One to
Severance Agreement ("Amendment Number One")
is made and entered into as of this 17th day
of August, 1999 (the "Effective Date"), by
and between ATLANTIC COAST AIRLINES HOLDINGS,
INC., a Delaware corporation ("ACAH"),
ATLANTIC COAST AIRLINES, a California
corporation ("ACA") (ACAH and ACA are herein
collectively referred to as the "Company")
and XXXXX X. XXXXX ("Xxxxx").
Witnesseth That:
Whereas, Xxxxx and the Company are
parties to a Severance Agreement dated as of
January 20, 1999 (the "Severance Agreement");
and
Whereas, the Compensation Committee
of the Board of Directors of the Company has
determined that the best interests of the
Company would be served by entering into this
amended and restated Agreement with Xxxxx;
Now, Therefore, the parties, for
and in consideration of the mutual and
reciprocal covenants and agreements
hereinafter contained, and intending to be
legally bound hereby, do contract and agree
that the Severance Agreement be and hereby is
amended as follows:
I. Paragraph 5.A of the Agreement is hereby
amended and restated to read as follows:
A. An annual base
salary of Two-Hundred Ninety Five
Thousand Dollars ($295,000) shall
be paid to Xxxxx. Commencing
October 1, 1999, an annual base
salary of Three-Hundred Ninety Five
Thousand Dollars ($395,000) shall
be paid to Xxxxx. Commencing
October 1, 2000 and each October 1
thereafter, the amount of Xxxxx'x
base salary shall be increased as
determined by the Compensation
Committee of the Board of Directors
of the Company; provided, however,
that in no event shall Xxxxx'x
annual base salary be less than the
previous year's annual base salary.
Xxxxx'x base salary for each year
shall be payable to him in
accordance with the reasonable
payroll practices of the Company as
from time to time in effect for
executive employees (but in no
event less often than monthly).
II. A new Paragraph 6.D is hereby added to
the Agreement to read as follows:
D. The Company agrees
to reimburse Xxxxx for the cost of
investment and tax planning
services up to $5,000 incurred
during 1999. Thereafter, any such
reimbursement shall be subject to
the discretion of the Compensation
Committee of the Board of
Directors. If such payments are
taxable to Xxxxx, the Company shall
pay Xxxxx a gross-up equal to the
estimated income, FICA and Medicare
taxes due with respect to such
reimbursement, with federal and
state income taxes being estimated
at the highest marginal rates.
III. Paragraph 8.A of the Agreement is hereby
amended and restated to read as follows:
A. Company agrees to
continue in force a stock option
plan or one which is substantially
similar to the existing plan
("Stock Option Plan"), which has
been approved by the shareholders
of the Company and, on the first
business day in each October
commencing in October, 2000, and
(subject to the provisions of
Paragraph 10.A.(vii)) continuing so
long as Xxxxx is employed by the
Company to xxxxx Xxxxx options
under the Stock Option Plan to
purchase not less than 100,000
shares of the common stock of ACAH
at the price per share at the
closing of the trading market on
the last business date prior to
such grant. The Company also
agrees to approve the issuance of
such additional shares as are
necessary to enable Xxxxx to
exercise such options. The Company
will not be required to reserve
shares from existing plans to cover
future obligations under this
paragraph, but will use reasonable
efforts to obtain shareholder
approval as necessary from time to
time to make a sufficient number of
additional shares available on a
timely basis, and will provide
Xxxxx with equivalent alternative
compensation should approval not be
obtained. The terms of the grant
of such options granted after
January 1, 1998 shall provide that
(a) Xxxxx'x right to exercise such
options shall vest and become
exercisable over the five-year
period beginning on the date of
each grant at the rate of one-fifth
per year (i.e., one-fifth shall
vest and become exercisable on the
first anniversary of the grant) so
long as Xxxxx is employed by the
Company, (b) Xxxxx'x right to
exercise such options to purchase
the entire number of shares covered
thereby shall become immediately
100% vested in the event there is a
Change in Control (as hereinafter
defined) or in the event Company
shall otherwise become obligated to
provide Xxxxx with Severance
Compensation as provided in
Paragraph 10.e. herein, (c) such
options shall be exercisable for
ten (10) years after the date of
the grant so long as Xxxxx is
employed by the Company and (d)
Xxxxx shall have the right to
exercise such vested options within
ninety (90) days following any
termination of Xxxxx'x employment
except that in the case of
termination of employment for which
Xxxxx is entitled to "Severance
Compensation" as provided herein,
in which case the terms of
Paragraph 10.E.(iii) shall apply.
Notwithstanding the above, the
terms of the grant of such options
shall be no less favorable to Xxxxx
than the terms of options granted
as of the time of the grant to
other senior executive officers.
IV. A new Paragraph 8.D is hereby added to
the Agreement to read as follows:
D. The Company has
granted to Xxxxx options, under the
Stock Option Plan and pursuant to a
Company Stock Option Agreement, to
purchase 100,000 shares of the
common stock of ACAH, effective as
of July 21, 1999 at the price per
share at the closing of the trading
market on July 20, 1999. Xxxxx
acknowledges that said grant is in
lieu of grants that were to be made
to him effective January 1, 2000
pursuant to the terms of this
Agreement as existed prior to the
execution of Amendment Number One.
In Witness Whereof, the Company has
hereunto caused this Amendment Number One to
be executed by a duly authorized officer and
Xxxxx has hereunto set his hand as of the day
and year first above written.
WITNESS:
/s/_____________________________
/s/__________________________
Xxxxx X.
Xxxxx
COMPANY:
ATTEST: ATLANTIC
COAST AIRLINES
/s/____________________________ BY:
/s/_________________________
Xxxxxxx X. Xxxxxxx,
C. Xxxxxx Xxxxx,
Secretary
Chairman of the Board
ATTEST:
ATLANTIC
COAST
AIRLINES
HOLDINGS,
INC.
/s/____________________________ BY:
/s/_________________________
Xxxxxxx X. Xxxxxxx,
C. Xxxxxx Xxxxx,
Secretary
Chairman of the Board
EXHIBIT 10.12(c)(1)
AMENDMENT NUMBER ONE
TO
SEVERANCE AGREEMENT
This Amendment Number One to
Severance Agreement (the "Amendment") is made
and entered into as of this 12th day of
August, 1999 (the "Effective Date"), by and
between ATLANTIC COAST AIRLINES HOLDINGS,
INC., a Delaware corporation ("ACAH"),
ATLANTIC COAST AIRLINES, a California
corporation ("ACA") (ACAH and ACA are herein
collectively referred to as the "Company")
and XXXXXX X. XXXXX ("Xxxxx").
Witnesseth That:
Whereas, Xxxxx and the Company are
parties to a Severance Agreement dated as of
January 20, 1999 (the "Severance Agreement");
and
Whereas, the Compensation Committee
of the Board of Directors of the Company has
determined that the best interests of the
Company would be served by entering into this
amended and restated Agreement with Xxxxx;
Now, Therefore, the parties, for
and in consideration of the mutual and
reciprocal covenants and agreements
hereinafter contained, and intending to be
legally bound hereby, do contract and agree
that the Severance Agreement be and hereby is
amended as follows:
I. Paragraph 5.A of the Agreement is hereby
amended and restated to read as follows:
A. An annual base
salary of Two-Hundred Thousand
Dollars ($200,000) shall be paid to
Xxxxx. Commencing on January 1,
2000, Xxxxx'x annual base salary
shall be increased to Two Hundred
Fifty Thousand Dollars ($250,000).
Commencing on October 1, 2000 and
on each October 1 thereafter, the
amount of Xxxxx'x base salary shall
be increased as determined by the
Compensation Committee of the Board
of Directors of the Company.
Xxxxx'x base salary for each year
shall be payable to him in
accordance with the reasonable
payroll practices of the Company as
from time to time in effect for
executive employees (but in no
event less often than monthly).
II. A new Paragraph 6.D is hereby added to
the Agreement to read as follows:
D. The Company agrees
to reimburse Xxxxx for the cost of
investment and tax planning
services up to $5,000 incurred
during 1999. Thereafter, any such
reimbursement shall be subject to
the discretion of the Compensation
Committee of the Board of
Directors.
III. Paragraph 8.A of the Agreement is hereby
amended and restated to read as follows:
A. Mandatory Stock
Options. Company agrees to
continue in force a stock option
plan or one which is substantially
similar to the existing plan
("Stock Option Plan"), which has
been approved by the shareholders
of the Company and, on the first
business day in each October
commencing in October, 2000, and
(subject to the provisions of
Paragraph 10.A.(vii)) continuing so
long as Xxxxx is employed by the
Company to xxxxx Xxxxx options
under the Stock Option Plan to
purchase not less than 50,000
shares of the common stock of ACAH
at the price per share at the
closing of the trading market on
the last business date prior to
such grant. The Company also
agrees to approve the issuance of
such additional shares as are
necessary to enable Xxxxx to
exercise such options. The Company
will not be required to reserve
shares from existing plans to cover
future obligations under this
Paragraph, but will use reasonable
efforts to obtain shareholder
approval as necessary from time to
time to make a sufficient number of
additional shares available on a
timely basis, and will provide
Xxxxx with equivalent alternative
compensation should approval not be
obtained. The terms of the grant
of such options shall be consistent
with the terms of options granted
as of the time of the grant to
other senior executive officers at
or below Xxxxx'x position with the
Company.
IV. A new Paragraph 8.E is hereby added to
the Agreement to read as follows:
E. The Company has
granted to Xxxxx options, under the
Stock Option Plan and pursuant to a
Company Stock Option Agreement, to
purchase 100,000 shares of the
common stock of ACAH effective as
of July 21, 1999 at the price per
share at the closing of the trading
market on July 20, 1999.
V. Paragraph 10.E.(i) of the Agreement is
hereby amended and restated to read as
follows:
(i) Severance Pay.
Throughout the Severance Period, Xxxxx will
receive severance pay at the rate of 100% of
his annual base salary in effect at the time
of his termination, to be paid on the
Company's regular payroll payment dates at
the same time and in the same fashion as the
Company's regular payroll payments. In the
event that a Termination Date occurs on or
before December 31, 1999 such that Xxxxx is
entitled to Severance Compensation as
provided herein, severance pay will be at the
rate of 100% of his annual base salary that
would have been in effect beginning January
1, 2000 as provided herein.
In Witness Whereof, the Company has
hereunto caused this Amendment to be executed
by a duly authorized officer and Xxxxx has
hereunto set his hand as of the day and year
first above written.
WITNESS:
/s/_____________________________
/s/__________________________
Xxxxxx X.
Xxxxx
COMPANY:
ATTEST: ATLANTIC
COAST AIRLINES
/s/____________________________
BY: /s/_________________________
Xxxxxxx X. Xxxxxxx,
Xxxxx X. Xxxxx,
Secretary
President & Chief Executive Officer
ATTEST:
ATLANTIC
COAST
AIRLINES
HOLDINGS,
INC.
/s/____________________________
BY: /s/_________________________
Xxxxxxx X. Xxxxxxx,
Xxxxx X. Xxxxx,
Secretary
President & Chief Executive Officer