Exhibit 10.15
THIS AGREEMENT MADE EFFECTIVE THE 1ST DAY OF AUGUST, 2006.
Between:
Laidlaw International, Inc., a Delaware corporation ("Laidlaw")
and
Mary B. Jordan (the "Executive")
WHEREAS, Laidlaw desires to employ the Executive and the Executive desires to be
employed by Laidlaw.
NOW THEREFORE, the parties have agreed that the terms and conditions of the
relationship shall be as follows:
ARTICLE 1 -- DEFINITIONS
Whenever used in this Agreement, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word is
capitalized:
(a) "Accrued Obligations" means any unpaid amounts with respect to (i) the
Executive's Base Salary through the Date of Termination, (ii) any
then-unpaid Annual Bonus or other incentive compensation that the Executive
may have earned pursuant to the terms of any applicable incentive
compensation or bonus plan of Laidlaw with respect to any fiscal year or
other performance period completed prior to the Date of Termination, (iii)
reimbursement for any properly incurred, unreimbursed business expenses
incurred prior to termination in accordance with Laidlaw's business
reimbursement policy applicable to the Executive prior to the Date of
Termination, and (iv) payments and benefits under the employee benefit and
incentive plans and perquisite programs of Laidlaw, in accordance with the
respective terms of those plans and perquisite programs.
(b) "Agreement" means this employment agreement, as amended from time to time.
(c) "Annual Bonus" means the annual bonus under Laidlaw's Short Term Incentive
Plan or any successor annual incentive plan.
(d) "Base Salary" means the salary of record paid to the Executive as annual
salary, and as further indicated in Section (a) of Article 4.
(e) "Board" means the Board of Directors of Laidlaw.
(f) "Cause" means:
(i) the continuous and willful failure or refusal by the Executive to
perform the Executive's material duties and responsibilities of her
position with Laidlaw
1
(other than any such failure resulting from the Executive's incapacity
due to physical or mental illness), which has not ceased within twenty
(20) days after a written demand for substantial performance is
delivered to the Executive by Laidlaw, which demand identifies with
particularity the manner in which Laidlaw believes that the Executive
has not performed such duties;
(ii) Executive's willful malfeasance or willful misconduct in connection
with Executive's duties hereunder or any willful act or willful
omission, including a willful failure to abide by the Laidlaw
International, Inc. Code of Business Conduct and Ethics, which is
materially injurious to the financial condition or business reputation
of Laidlaw or any significant Subsidiary;
(iii) Executive's commission of an act of fraud, embezzlement or theft in
connection with the Executive's duties or in the course of her
employment with Laidlaw or any Subsidiary;
(iv) the conviction of the Executive of, or the entering of a plea of nolo
contendere by, the Executive with respect to a felony; or
(v) Executive's breach of the provisions of Article 7 of this Agreement.
For purposes of this Section (f) and Article 17, no act or omission by the
Executive shall be considered "willful" unless it is done or omitted in bad
faith or without reasonable belief that the Executive's action or omission
was in the best interests of Laidlaw. Any act, or failure to act, based
upon authority given pursuant to a resolution duly adopted by the Board or
based upon the advice of counsel for Laidlaw shall be conclusively presumed
to be done, or omitted to be done, in good faith and in the best interests
of Laidlaw. A termination of employment shall not be deemed to be for Cause
unless prior to such termination the Executive shall have received a copy
of a resolution duly adopted by the affirmative vote of not less than a
majority of the disinterested membership of the Board at a meeting of such
Board called and held for such purpose (after reasonable notice is provided
to the Executive and the Executive is given an opportunity to be heard
before such Board), finding that, in the good faith opinion of the Board,
the Executive is guilty of the conduct described in Subsection (i), (ii),
(iii), (iv) or (v) of this Section (f) above.
(g) "Change in Control" means the occurrence during the term of this Agreement
of any of the following events:
(i) the acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of fifty percent (50%) or more of the
then-outstanding Voting Stock; provided, however, that the following
acquisitions shall not constitute a Change in Control: (A) any
acquisition directly from Laidlaw, (B) any acquisition by Laidlaw, (C)
any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by Laidlaw or any Subsidiary, or (D) any
acquisition by any Person
2
pursuant to a transaction that complies with clauses (A), (B) and (C)
of Subsection (iii) of this Section (g);
(ii) individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason (other than death or
disability) to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by Laidlaw's
stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board (either by a specific
vote or by approval of the proxy statement of Laidlaw in which such
person is named as a nominee for director, without objection to such
nomination) shall be considered as though such individual were a
member of the Incumbent Board, but excluding for this purpose, any
such individual whose initial assumption of office occurs as a result
of an actual or threatened election contest (within the meaning of
Rule 14a-11 of the Exchange Act) with respect to the election or
removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board;
(iii) consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of Laidlaw
(a "Business Combination"), unless, in each case, immediately
following such Business Combination, (A) all or substantially all of
the individuals and entities who were the beneficial owners of Voting
Stock of Laidlaw immediately prior to such Business Combination
beneficially own, directly or indirectly, more than fifty percent
(50%) of the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to
vote generally in the election of directors of the entity resulting
from such Business Combination (including, without limitation, an
entity which as a result of such transaction owns Laidlaw or all or
substantially all of Laidlaw's assets either directly or through one
or more subsidiaries) in substantially the same proportions relative
to each other as their ownership, immediately prior to such Business
Combination, of the Voting Stock of Laidlaw, (B) no Person (excluding
any entity resulting from such Business Combination or any employee
benefit plan (or related trust) sponsored or maintained by Laidlaw,
any Subsidiary or such entity resulting from such Business
Combination) beneficially owns, directly or indirectly, fifteen (15%)
or more of the then outstanding shares of common stock of the entity
resulting from such Business Combination or the combined voting power
of the then outstanding voting securities of such entity except to the
extent such ownership existed prior to the Business Combination, and
(C) at least a majority of the members of the board of directors of
the entity resulting from such Business Combination were members of
the Incumbent Board at the time of the execution of the initial
agreement or of the action of the Board providing for such Business
Combination; or
(iv) approval by the stockholders of Laidlaw of a complete liquidation or
dissolution of Laidlaw.
(h) "Code" means the Internal Revenue Code of 1986, as amended.
3
(i) "Committee" means the Human Resources and Compensation Committee of the
Board.
(j) "Date of Termination" has the meaning ascribed to such term in Section (e)
of Article 6.
(k) "Effective Date" means the date first above written.
(l) "Employee Benefits" means the perquisites, benefits and service credit for
benefits as provided under any and all employee retirement income and
welfare benefit policies, plans, programs or arrangements in which the
Executive is entitled to participate, including, without limitation, any
stock option, performance share, performance unit, stock purchase, stock
appreciation, savings, pension, supplemental executive retirement, or other
retirement income or welfare benefit, compensation, incentive compensation,
group or other life, health, medical/hospital or other insurance (whether
funded by actual insurance or self-insurance by Laidlaw or a Subsidiary),
salary continuation, expense reimbursement and other employee benefit
policies, plans, programs or arrangements.
(m) "Exchange Act" means the Securities Exchange Act of 1934.
(n) "Executive" means Mary B. Jordan.
(o) "Good Reason" means the occurrence of one or more of the following events
(regardless of whether any other reason, other than Cause, for such
termination exists or has occurred, including, without limitation, other
employment):
(i) With respect to the two (2) year period commencing on a Change in
Control, the failure to elect or reelect or otherwise to maintain the
Executive in the office or the position, or a substantially equivalent
office or position, of or with Laidlaw and/or a Subsidiary (or any
successor thereto by operation of law of or otherwise), as the case
may be, which the Executive held immediately prior to a Change in
Control, or the removal of the Executive as a director of Laidlaw
and/or a Subsidiary (or any successor thereto) if the Executive shall
have been a director of Laidlaw and/or a Subsidiary immediately prior
to the Change in Control;
(ii) With respect to the two (2) year period commencing on a Change in
Control, (A) a significant adverse change in the nature or scope of
the authorities, powers, functions, responsibilities or duties
attached to the position with Laidlaw and any Subsidiary which the
Executive held immediately prior to the Change in Control, (B) a
reduction in the aggregate of the Executive's Base Salary received
from Laidlaw and any Subsidiary or the Executive's Incentive Pay
opportunity from Laidlaw or its Subsidiaries, or (C) the termination
or denial of the Executive's rights to Employee Benefits or a
reduction in the scope or value thereof to a level that is
substantially lower in the aggregate from the level in effect at the
time of the Change in Control, any of which is not remedied by Laidlaw
within ten (10) calendar days after receipt by Laidlaw of written
notice from the Executive of such change, reduction, denial or
termination, as the case may be;
4
(iii) The liquidation, dissolution, merger, consolidation or reorganization
of Laidlaw or transfer of all or substantially all of its business
and/or assets, unless the successor or successors (by liquidation,
merger, consolidation, reorganization, transfer or otherwise) to which
all or substantially all of its business and/or assets have been
transferred (by operation of law or otherwise) assumes all duties and
obligations of Laidlaw under this Agreement pursuant to Section (a) of
Article 14;
(iv) Laidlaw relocates its principal executive offices (if such offices are
the principal location of the Executive's work), or requires the
Executive to have her principal location of work changed, to any
location that, in either case, increases the Executive's commute to
work by more than fifty (50) miles without her prior written consent;
or
(v) Without limiting the generality or effect of the foregoing, any
material breach of this Agreement by Laidlaw or any successor thereto
which is not remedied by Laidlaw within ten (10) calendar days after
receipt by Laidlaw of written notice from the Executive of such
breach.
(p) "Laidlaw" means Laidlaw International Inc., a Delaware corporation.
(q) "Notice of Termination" has the meaning ascribed to such term in Section
(d) of Article 6.
(r) "Retirement Plans" means the retirement income, supplemental executive
retirement, excess benefits and retiree medical, life and similar benefit
plans, programs or arrangements of Laidlaw or a Subsidiary in which the
Executive is entitled to participate.
(s) "Subsidiary" means an entity in which Laidlaw directly or indirectly
beneficially owns fifty percent (50%) or more of the outstanding Voting
Stock.
(t) "Target Bonus" has the meaning ascribed to such term in Section (b) of
Article 4.
(u) "Voting Stock" means securities entitled to vote generally in the election
of directors.
ARTICLE 2 -- TERM OF THE AGREEMENT
The term of this Agreement shall commence on the Effective Date and shall
continue until terminated in accordance with the provisions of this Agreement.
ARTICLE 3 -- TITLE; COMMENCEMENT OF EMPLOYMENT; REPORTING
The Executive shall serve as the Executive Vice President of Human Resources and
Internal Communications of Laidlaw. The Executive shall report to the Chief
Executive Officer.
ARTICLE 4 -- COMPENSATION
(a) Unless otherwise provided, all dollar amounts set forth in this Agreement
shall be in United States Dollars. The Base Salary of the Executive for her
services is established by
5
the Committee at the annualized rate of Three Hundred Thousand Dollars
($300,000.00). The Base Salary shall be payable twice monthly on the
fifteenth (15th) business day and the last business day of each month. The
Base Salary shall be reviewed annually during Laidlaw's normal review
period. The review will be undertaken by assessing the Executive's
achievement of the overall objectives established by the Committee in
consultation with the Executive and with regard to the market rates of
remuneration paid for similar duties and responsibilities. As a result of
such review, the Executive's Base Salary may be increased, but not
decreased.
(b) The Executive will be eligible to participate in and be eligible to receive
an Annual Bonus under Laidlaw's Short Term Incentive Plan or any successor
plan or program. For each fiscal year of Laidlaw, the Executive's target
bonus shall be no less than fifty percent (50%) of Base Salary (the "Target
Bonus") and the maximum bonus shall be no less than one hundred percent
(100%) of Base Salary. The Executive's right to receive any bonus under
Laidlaw's Short Term Incentive Plan shall be determined based upon
measurements established by the Committee after consultation with the
Executive and as set forth in accordance with Laidlaw's Short Term
Incentive Plan.
(c) The Executive shall participate in the Supplemental Executive Retirement
Plan sponsored by Laidlaw for the benefit of its employees.
(d) Subject to approval by the Committee, the Executive will be eligible to
receive equity or equity based grants from time to time. Such grants will
be on terms and conditions established by the Committee in accordance with
the Laidlaw International, Inc. Amended and Restated 2003 Equity and
Performance Incentive Plan or any successor plan.
ARTICLE 5 -- BENEFITS
(a) AUTOMOBILE
Laidlaw will provide the Executive with a monthly allowance of One Thousand
Dollars ($1,000.00) for expenses incurred by the Executive for an
automobile and its related operating expenses. Laidlaw shall also reimburse
the Executive for reasonable gas and insurance expenses as incurred,
provided that the Executive provides to Laidlaw an itemized written account
and receipts acceptable to Laidlaw.
(b) EXPENSES
It is understood and agreed that the Executive will incur expenses in
connection with her duties under this Agreement, including, but not limited
to, travel expenses, home facsimile expenses, personal computer expenses
and telephone expenses. Laidlaw shall reimburse the Executive for any such
expenses provided that the Executive provides to Laidlaw an itemized
written account and receipts acceptable to Laidlaw.
(c) VACATION
The Executive shall be entitled to five (5) weeks vacation during each
calendar year. The vacation shall be taken at the discretion of the
Executive with the understanding that the Executive will take into account
business needs and operations in scheduling vacation. All vacation earned
must be taken by the end of the calendar year following accrual or it
6
is forfeited.
(d) WELFARE BENEFITS
The Executive shall be entitled to those welfare benefit coverages as are
offered by Laidlaw to its employees generally (such as medical insurance,
dental insurance, short- and long-term disability insurance and group term
life insurance), all in accordance with the employee benefit plans and
policies maintained by Laidlaw or a Subsidiary for the benefit of employees
of Laidlaw, and as amended from time to time.
(e) CLUB MEMBERSHIP
Laidlaw will reimburse the Executive for the one-time initiation fee in one
business club that the Executive will use in connection with Laidlaw's
business. Laidlaw will also reimburse the Executive for ongoing annual dues
and business-related expenses incurred by the Executive in connection with
the Executive's membership in such business club.
(f) PROFESSIONAL EXPENSES
Laidlaw will reimburse the Executive for up to Five Thousand Dollars
($5,000.00) annually for expenses incurred by the Executive in connection
with the Executive's tax preparation and financial planning.
(g) POST-TERMINATION RELOCATION REIMBURSEMENT
In the event Executive's employment is terminated by Laidlaw without Cause
during the first twelve (12) months of her employment with Laidlaw, Laidlaw
will reimburse reasonable and appropriate relocation expenses associated
with moving Executive from the Chicago area to Vancouver or similar
destination in North America, provided that the Executive provides to
Laidlaw an itemized written account and receipts acceptable to Laidlaw.
(h) CHANGE IN CONTROL VESTING
Upon a Change in Control, and notwithstanding any provision to the contrary
in any applicable plan, program or agreement, upon the occurrence of a
Change in Control, all equity incentive awards held by the Executive shall
become fully vested and all stock options held by the Executive shall
become fully exercisable.
ARTICLE 6 -- TERMINATION OF EMPLOYMENT
(a) The parties understand and agree that this Agreement and the Executive's
employment hereunder may be terminated in the following manner in the
specified circumstances:
(i) The Executive's employment hereunder shall automatically terminate
upon the death of the Executive.
(ii) By Laidlaw, if, as a result of the Executive's incapacity due to
physical or mental illness which is expected to be of more than a
brief duration, the Executive has been unable to perform the essential
functions of her job for one hundred and eighty (180) days (whether or
not consecutive) during any period of eighteen (18) consecutive months
("Disability"), and no reasonable accommodation can be made that will
allow Executive to perform the essential functions of her position
7
with Laidlaw. Upon such termination, the Executive shall be entitled
to the same severance benefits and payments described in Subsection
(v) or (vi), as applicable, as if such termination was a termination
by Laidlaw without Cause.
(iii) By the Executive, at any time, for any reason. Laidlaw may waive
notice required by Section (d) of this Article 6, in whole or in part,
upon immediate payment to the Executive of the Executive's Base Salary
for such portion of notice period as is waived by Laidlaw. If such
termination is for Good Reason, then unless the provisions of
Subsection (vi) apply, the Executive shall be entitled to the same
payments and benefits as provided in Subsection (v) for terminations
by Laidlaw without Cause. If such termination is for any other reason,
Laidlaw shall pay to the Executive the Accrued Obligations.
(iv) By Laidlaw, in its absolute discretion, without any pay in lieu of
notice, for Cause. Upon such termination, Laidlaw shall pay to the
Executive the Accrued Obligations.
(v) By Laidlaw, in its absolute discretion and for any reason, without
Cause. Upon such termination, unless the provisions of Subsection (vi)
hereof apply, Laidlaw shall (A) continue to pay the Executive her Base
Salary in effect at the time of such termination for a period of
twenty-four (24) months following such termination, (B) provided such
termination is following the second anniversary of her employment with
Laidlaw (or any predecessor thereto), pay the Executive a monthly
amount equal to one-twelfth of the Executive's Target Bonus in effect
at the time of Executive's termination of employment for a period of
twenty-four (24) months following such termination, (C) continue to
provide the Executive term life insurance for a period of twenty-four
(24) months after termination, or, if such benefits cannot be provided
by Laidlaw, Laidlaw shall pay to the Executive an equivalent lump sum
cash amount in lieu of such benefits, (D) continue to provide the
Executive (and her eligible dependents) with the opportunity to
continue to participate in its group medical and dental benefits (with
such continuation being counted towards any required COBRA
continuation period), at the Executive's sole expense based on COBRA
rates charged from time to time; provided, however, that Laidlaw shall
pay to the Executive over the twenty-four (24) month period an amount
equal to the full COBRA cost of such coverage, and (E) pay to the
Executive the Accrued Obligations. Notwithstanding the foregoing, if
the Executive is a "specified employee" within the meaning of Code
Section 409A at the Date of Termination, then
(I) the total amount which would have been payable to the Executive
over the twenty-four (24) month period pursuant to this
Subsection (v) shall instead be paid to the Executive in equal
monthly amounts over the period commencing on the Date of
Termination and ending no later than the first day of the third
month following the later of (X) the calendar year in which the
Date of Termination occurred and (Y) the fiscal year of Laidlaw
in which the Date of Termination occurred, if such payments would
not be subject to Code Section 409A, or
8
(II) if the payments specified in Clause (I) would be subject to Code
Section 409A, then such payments shall be paid in the manner set
forth above without regard to Clause (I) hereof, but payments
which would otherwise have been made during the first six (6)
months following the Date of Termination, shall be withheld and
paid to the Executive during the seventh month following the Date
of Termination, increased for interest as provided in Section (b)
hereof.
(vi) In the event that during the two (2) year period commencing on the
date of a Change in Control, Laidlaw terminates the Executive's
employment without Cause or the Executive terminates employment for
Good Reason, Laidlaw shall pay to the Executive the amounts described
in Annex A within five (5) business days after the Date of Termination
and shall provide to the Executive the benefits described on Annex A
for the periods described therein. Notwithstanding the foregoing, in
the event that the Executive is at the Date of Termination a
"specified employee" within the meaning of Code Section 409A, payment
to the Executive shall be made within five (5) days following the
expiration of six (6) months from the Date of Termination, and not
before such six (6) month period, if necessary to avoid adverse tax
consequences to the Executive under Code Section 409A.
(b) Without limiting the rights of the Executive at law or in equity, in the
event it is determined that Laidlaw fails to make any payment or provide
any benefit required to be made or provided under Section (a) hereof on a
timely basis, Laidlaw shall pay interest on the amount or value thereof at
an annualized rate of interest equal to the so-called composite "prime
rate" as quoted from time to time during the relevant period in The Wall
Street Journal. Any change in such prime rate shall be effective on and as
of the date of such change. In addition, if any payment described in
Subsection (v) or (vi) of Section (a) hereof by Laidlaw subjects the
Executive to the excise tax under Code Section 409A on such payment,
Laidlaw shall pay on the Executive's behalf to the applicable taxing
authorities, an amount which, after payment of all state, local and federal
income and employment taxes which may be due on such payment (calculated at
the highest marginal rates), is equal to the excise tax under Code Section
409A which arose as a result of Laidlaw's delay or acceleration in making
such payment.
(c) In order to receive the entitlement under Subsection (vi) of Section (a)
hereof, or Clauses (A), (B) and (C) of Subsection (v) of Section (a) hereof
(whether such termination is by the Executive for Good Reason or by Laidlaw
without Cause), the Executive must undertake to sign a release in a form
satisfactory to Laidlaw, fully releasing Laidlaw from further claims upon
payment of the amounts stipulated herein and must not revoke such release.
However, the form of release shall not require that the Executive give up
any rights of indemnity which the Executive may have had against Laidlaw
for acts carried out by the Executive in the ordinary course of Laidlaw's
business, nor shall it require the release of the benefits under this
Agreement payable due to or after the Executive's termination of
employment. Laidlaw may withhold payment of such amount until the period
during which the Executive may revoke such waiver (normally seven (7) days)
has elapsed.
9
(d) Any purported termination of the Executive's employment by Laidlaw or by
the Executive shall be communicated by written Notice of Termination to the
other party hereto in accordance with Article 15. "Notice of Termination"
shall mean a notice that shall indicate the specific termination provision
in this Agreement relied upon and shall set 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.
(e) "Date of Termination" shall mean (i) if the Executive's employment is
terminated because of death, the date of the Executive's death, (ii) if the
Executive's employment is terminated for Disability, the date Notice of
Termination is delivered to the Executive following a determination that
Disability exists pursuant to the provisions of this Agreement, (iii) if
the Executive's employment is terminated by Laidlaw for any other reason
other than Disability or for Cause or if the Executive terminates
employment for Good Reason, the date specified in the Notice of Termination
which shall not be less than thirty (30) days from the date such Notice of
Termination is given, (iv) if the Executive's employment is terminated by
Laidlaw for reasons of Cause, immediately upon delivery of the Notice of
Termination and the expiration of any cure period provided under Section
(d) of Article I, and (v) if the Executive's employment is terminated by
the Executive pursuant to Subsection (iii) of Section (a) of this Article
for reasons other than Good Reason, the date specified in the Notice of
Termination which shall not be less than ninety (90) days from the date
such Notice of Termination is given.
(f) Any termination of employment of the Executive or the removal of the
Executive from the office or position in Laidlaw or any Subsidiary that
occurs (i) not more than ninety (90) days prior to the date on which a
Change in Control occurs, and (ii) following the commencement of any
discussion with a third person that ultimately results in a Change in
Control, shall be deemed to be a termination or removal of the Executive
within the two (2) year period commencing on a Change in Control for
purposes of this Agreement and the term of this Agreement shall be deemed
to have been extended until such Change in Control solely for purposes of
determining any payments due to the Executive as a result of such
termination.
ARTICLE 7 -- RESTRICTIVE COVENANTS
(a) Ownership and Protection of Proprietary Information.
(i) "Confidential Information" means data and information relating to the
business of Laidlaw (which does not rise to the status of a Trade
Secret) which is or has been disclosed to the Executive or of which
the Executive became aware as a consequence of or through her
employment relationship to Laidlaw and which has value to Laidlaw or
its Subsidiaries and is not generally known to its competitors.
Confidential Information shall not include any data or information
that has been voluntarily disclosed to the public by Laidlaw or its
Subsidiaries (except where such public disclosure has been made by the
Executive without authorization) or that has been independently
developed and disclosed by others, or that otherwise enters the public
domain through lawful means.
10
(ii) "Trade Secrets" means information including, but not limited to,
technical or non-technical data, formulas, patterns, compilations,
programs, devices, methods, techniques, drawings, processes, financial
data, financial plans, or product plans which (i) derives economic
value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use, and (ii) is the
subject of efforts that are reasonable under the circumstances to
maintain its secrecy.
(iii) Confidentiality. All Confidential Information and Trade Secrets and
all physical embodiments thereof received or developed by the
Executive while employed by Laidlaw are confidential to and are and
will remain the sole and exclusive property of Laidlaw or its
Subsidiaries. Except to the extent necessary to perform the duties
assigned to her by Laidlaw, the Executive will hold such Confidential
Information and Trade Secrets in strictest confidence, and will not
use, reproduce, distribute, disclose or otherwise disseminate the
Confidential Information and Trade Secrets or any physical embodiments
thereof and may in no event take any action causing any Confidential
Information and Trade Secrets disclosed to or developed by the
Executive to lose its character or cease to qualify as Confidential
Information or Trade Secrets.
(iv) Return of Company Property. Upon request by Laidlaw or its
Subsidiaries, and in any event upon termination of the employment of
the Executive with Laidlaw for any reason, as a prior condition to
receiving any final compensation hereunder, the Executive will
promptly deliver to Laidlaw or its Subsidiaries all property belonging
to Laidlaw, including, without limitation, all Confidential
Information and Trade Secrets (and all embodiments thereof) then in
the Executive's custody, control or possession.
(v) Survival. The covenants of confidentiality set forth herein will apply
on and after the date hereof to any Confidential Information and Trade
Secrets disclosed by Laidlaw or its Subsidiaries or developed by the
Executive prior to or after the date hereof. The covenants restricting
the use of Confidential Information will continue and be maintained by
the Executive for a period of two (2) years following the Date of
Termination under this Agreement. The covenants restricting the use of
Trade Secrets will continue and be maintained by the Executive
following the Date of Termination under this Agreement for so long as
permitted by applicable law.
(b) Non-Solicitation of Employees. During the Term and for a period of two (2)
years following the Date of Termination of her employment, the Executive
shall not, directly or indirectly, solicit or induce any employee of
Laidlaw or its Subsidiaries, with whom the Executive has had material
contact during her employment, to terminate employment with Laidlaw or the
Subsidiary in favor of employment by any person, firm, or entity affiliated
with the Executive; provided, however, that the foregoing covenant shall
not apply to general solicitations for a position not specifically directed
to a particular individual which is contained in newspapers, magazines,
periodicals or electronic media of general circulation. This provision will
apply whether or not the Executive who is solicited or induced to terminate
her employment is employed pursuant to a written
11
agreement and whether or not her employment is for a determined period or
at-will.
(c) Non-Solicitation of Customers. The Executive agrees that during the Term
and for a period of two (2) years following the Date of Termination of her
employment, the Executive will not, either directly or indirectly, on the
Executive's own behalf or in the service of or on behalf of others,
solicit, divert or appropriate, or attempt to solicit, divert or
appropriate, to a business involving the provision of contract bus services
for school bus transportation in Canada and/or the United States, municipal
and paratransit bus transportation within the United States, or inter-city
and tourism bus transportation throughout North America (a "Competing
Business"), any individual or entity which was an actual or actively sought
prospective client or customer of Laidlaw or its Subsidiaries and with whom
the Executive had material contact during the Executive's last two (2)
years of employment with Laidlaw. Nothing in this Section (c) shall be
construed to restrict the Executive from working for a Competing Business
solely because such Competing Business does business with a client or
customer of Laidlaw or its Subsidiaries or prospective client or customer
of Laidlaw or its Subsidiaries or because individuals of such Competing
Business who have contact with such clients or customers report directly or
indirectly to the Executive.
(d) Non-Competition. The Executive agrees that during employment pursuant to
this Agreement and for twenty-four (24) months following termination
without Cause of her employment by Laidlaw and payment of the severance
payment amount and benefit continuation as detailed in Subsection (v) or
(vi), as applicable, of Section (a) of Article 6, she shall not either
individually or in partnership, or jointly in conjunction with any other
person, entity or organization, as principal, agent, consultant, lender,
contractor, employer, employee, investor, shareholder, or in any other
manner, directly or indirectly, advise, manage, carry on, establish,
control, engage in, invest in, offer financial assistance or services to,
or permit her name to be used by any Competing Business that competes with
the then-existing business of Laidlaw or its Subsidiaries, provided that
the Executive shall be entitled, for investment purposes, to purchase and
trade shares of a public company which are listed and posted for trading on
a recognized stock exchange and the business of which public company may be
in competition with the business of Laidlaw or its Subsidiaries, provided
that the Executive shall not directly or indirectly own more than five
percent (5%) of the issued share capital of the public company, or
participate in its management or operation, or in any advisory capacity
within the time limits set out herein.
(e) Enforcement of Covenants. Without limiting the right of Laidlaw to pursue
all other legal and equitable remedies available for violation by the
Executive of the covenants contained in this Article 7, it is expressly
agreed by the Executive and Laidlaw that other remedies cannot fully
compensate Laidlaw for any violation by the Executive of the covenants
contained in this Article 7 and that Laidlaw shall be entitled to
injunctive relief, without the necessity of proving actual monetary loss,
to prevent any such violation or any continuing violation thereof. Laidlaw
and the Executive further agree that all payments under Subsection (v) or
Subsection (vi), as applicable, of Section (a) of Article 6 hereof shall
immediately cease and shall no longer be an obligation of Laidlaw in the
event of any violation of the covenants contained in Sections (b) or (c)
hereof which is not cured within (10) days of written notice by Laidlaw to
the Executive of such
12
violation or of a willful and material violation of the covenants contained
in Section (d) hereof. Laidlaw and the Executive further agree that such
forfeiture shall not be deemed to be liquidated damages for breach of such
covenants. Each party intends and agrees that if in any action before any
court or agency legally empowered to enforce the covenants contained in
this Article 7, any term, restriction, covenant or promise contained herein
is found to be unreasonable and accordingly unenforceable, then such term,
restriction, covenant or promise shall be deemed modified to the extent
necessary to make it enforceable by such court or agency.
ARTICLE 8 -- AUTHORITY
(a) The Executive shall have such duties, responsibilities and authority as are
reasonable and appropriate for the Executive's title and position and as
are assigned to her by the Chief Executive Officer and the Board from time
to time. The Executive shall support the Chief Executive Officer in
carrying out the general or specific instructions and directions of the
Chief Executive Officer and the Board and together with the Chief Executive
Officer in doing so, may enter into contracts, engagements or commitments
of every nature or kind, in the name of and on behalf of Laidlaw, and may
engage, employ and dismiss all managers and other employees and agents of
Laidlaw, subject to the by-laws and charter documents of Laidlaw and the
authority given her by Laidlaw from time to time.
(b) The Executive shall conform to all lawful instructions and directions given
to her by the Chief Executive Officer and the Board and obey and carry out
the by-laws of Laidlaw.
ARTICLE 9 -- SERVICE
The Executive, throughout the term of her employment, shall devote her full time
and attention to the business and affairs of Laidlaw, and shall not undertake
any other business or occupation or, unless approved by the Chief Executive
Officer or as a part of her job functions or responsibilities, become either (i)
an officer, employee or agent of any other company or firm which is a commercial
venture or (ii) a director of more than two companies or firms which are
commercial ventures. The Executive shall well and faithfully serve Laidlaw and
use her best efforts to promote the interests thereof.
ARTICLE 10 -- CERTAIN ADDITIONAL PAYMENTS
(a) Anything in this Agreement to the contrary notwithstanding and except as
set forth below, in the event it shall be determined that any Payment would
be subject to the Excise Tax, then the Executive shall be entitled to
receive an additional payment (the "Gross-Up Payment") in an amount such
that, after payment by the Executive of all taxes (and any interest or
penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up Payment and after
the payment of all additional taxes and interest imposed under Code Section
409A(a)(1)(B) on the Gross-Up Payment and any severance payment made to the
Executive hereunder, the Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding
the foregoing provisions of this Section (a), if it shall be
13
determined that the Executive is entitled to the Gross-Up Payment, but that
the Parachute Value of all Payments does not exceed 110% of the Safe Harbor
Amount, then no Gross-Up Payment shall be made to the Executive and the
amounts payable under this Agreement shall be reduced so that the Parachute
Value of all Payments, in the aggregate, equals the Safe Harbor Amount. The
reduction of the amounts payable hereunder, if applicable, shall be made by
first reducing the cash payments under Annex A unless an alternative method
of reduction is elected by the Executive, and in any event shall be made in
such a manner as to maximize the Value of all Payments actually made to the
Executive. For purposes of reducing the Payments to the Safe Harbor Amount,
only amounts payable under this Agreement (and no other Payments) shall be
reduced. If the reduction of the amount payable under this Agreement would
not result in a reduction of the Parachute Value of all Payments to the
Safe Harbor Amount, no amounts payable under this Agreement shall be
reduced pursuant to this Section (a). Laidlaw's obligations under this
Article 10 shall not be conditioned upon the Executive's termination of
employment, and they shall survive the termination of the Executive's
employment and the Term with respect to any Payments that are determined by
the Accounting Firm to be contingent on a "change of control" (as defined
in Code Section 280G) of Laidlaw that occurs during the Term.
(b) Subject to the provisions of Section (c) hereof, all determinations
required to be made under this Article 10, including whether and when a
Gross-Up Payment is required, the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination shall be made
by the independent accounting firm regularly servicing Laidlaw prior to the
Change in Control, or such other nationally recognized certified public
accounting firm as may be designated by the Executive (the "Accounting
Firm"). The Accounting Firm shall provide detailed supporting calculations
both to Laidlaw and the Executive within fifteen (15) business days of the
receipt of notice from the Executive that there has been a Payment or such
earlier time as is requested by Laidlaw. In the event that the Accounting
Firm is serving as accountant or auditor for the individual, entity or
group effecting the Change in Control, the Executive may appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the
Accounting Firm hereunder). All fees and expenses of the Accounting Firm
shall be borne solely by Laidlaw. Any Gross-Up Payment, as determined
pursuant to this Article 10, shall be paid by Laidlaw to the Executive or
the applicable taxing authorities within five (5) business days of the
receipt of the Accounting Firm's determination, which determination shall
be made no later than the end of the second month following the later of
(i) the calendar year in which the Executive's employment with Laidlaw
terminates or (ii) the taxable year of Laidlaw in which the Executive's
employment with Laidlaw terminates. In the event that such determination
cannot be made within such period, payment may be made as soon as
practicable after such determination can be made. Any determination by the
Accounting Firm shall be binding upon Laidlaw and the Executive. As a
result of the uncertainty in the application of Code Section 4999 at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments that will not have been made by Laidlaw
should have been made (the "Underpayment"), consistent with the
calculations required to be made hereunder. In the event Laidlaw exhausts
its remedies pursuant to Section (c) hereof and the Executive thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment
14
that has occurred and any such Underpayment shall be promptly paid by
Laidlaw to or for the benefit of the Executive.
(c) The Executive shall notify Laidlaw in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by Laidlaw
of the Gross-Up Payment. Such notification shall be given as soon as
practicable, but no later than ten (10) business days after the Executive
is informed in writing of such claim. The Executive shall apprise Laidlaw
of the nature of such claim and the date on which such claim is requested
to be paid. The Executive shall not pay such claim prior to the expiration
of the thirty (30) day period following the date on which the Executive
gives such notice to Laidlaw (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If Laidlaw
notifies the Executive in writing prior to the expiration of such period
that Laidlaw desires to contest such claim, the Executive shall:
(i) give Laidlaw any information reasonably requested by Laidlaw
relating to such claim,
(ii) take such action in connection with contesting such claim as
Laidlaw shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by
Laidlaw,
(iii) cooperate with Laidlaw in good faith in order to effectively
contest such claim, and
(iv) permit Laidlaw to participate in any proceedings relating to such
claim;
provided, however, that Laidlaw shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in
connection with such contest, and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section (c), Laidlaw shall control all
proceedings taken in connection with such contest, and, at its sole
discretion, may pursue or forgo any and all administrative appeals,
proceedings, hearings and conferences with the applicable taxing authority
in respect of such claim and may, at its sole discretion, either direct the
Executive to pay the tax claimed and sue for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court
of initial jurisdiction and in one or more appellate courts, as Laidlaw
shall determine; provided, however, that if Laidlaw directs the Executive
to pay such claim and sue for a refund, Laidlaw shall advance the amount of
such payment to the Executive, on an interest-free basis, and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties) imposed with
respect to such advance or with respect to any imputed income in connection
with such advance; and provided, further, that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due
is
15
limited solely to such contested amount. Furthermore, Laidlaw's control of
the contest shall be limited to issues with respect to which the Gross-Up
Payment would be payable hereunder, and the Executive shall be entitled to
settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.
(d) If, after the receipt by the Executive of a Gross-Up Payment or an amount
advanced by Laidlaw pursuant to Section (c) hereof, the Executive becomes
entitled to receive any refund with respect to the Excise Tax to which such
Gross-Up Payment relates or with respect to such claim, the Executive shall
(subject to Laidlaw's complying with the requirements of Section (c)
hereof, if applicable) promptly pay to Laidlaw the amount of such refund
(together with any interest paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Executive of an amount advanced by
Laidlaw pursuant to Section (c) hereof, a determination is made that the
Executive shall not be entitled to any refund with respect to such claim
and Laidlaw does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of thirty (30) days
after such determination, then such advance shall be forgiven and shall not
be required to be repaid and the amount of such advance shall offset, to
the extent thereof, the amount of Gross-Up Payment required to be paid.
(e) Notwithstanding any other provision of this Article 10, Laidlaw may, in its
sole discretion, withhold and pay over to the Internal Revenue Service or
any other applicable taxing authority, for the benefit of the Executive,
all or any portion of any Gross-Up Payment, and the Executive hereby
consents to such withholding.
(f) Definitions. The following terms shall have the following meanings for
purposes of this Article 10.
(i) "Excise Tax" shall mean the excise tax imposed by Code Section 4999,
together with any interest or penalties imposed with respect to such
excise tax.
(ii) "Parachute Value" of a Payment shall mean the present value as of the
date of the change of control for purposes of Code Section 280G of the
portion of such Payment that constitutes a "parachute payment" under
Code Section 280G(b)(2), as determined by the Accounting Firm for
purposes of determining whether and to what extent the Excise Tax will
apply to such Payment.
(iii) "Payment" shall mean any payment or distribution in the nature of
compensation (within the meaning of Code Section 280G(b)(2)) to or for
the benefit of the Executive, whether paid or payable pursuant to this
Agreement or otherwise.
(iv) "Safe Harbor Amount" means 2.99 times the Executive's "base amount,"
within the meaning of Code Section 280G(b)(3).
(v) "Value" of a Payment shall mean the economic present value of a
Payment as of the date of the change of control for purposes of Code
Section 280G, as determined by the Accounting Firm using the discount
rate required by Code Section 280G(d)(4).
16
ARTICLE 11 -- NON-EXCLUSIVITY OF RIGHTS
Nothing in this Agreement shall prevent or limit the Executive's continuing or
future participation in any benefit, bonus, incentive or other plan or program
provided by Laidlaw or any of its affiliates and for which the Executive may
qualify, nor shall anything herein limit or otherwise prejudice such rights as
the Executive may have under any other agreements with Laidlaw or any of its
affiliates, including, but not limited to stock option, deferred share, or
restricted stock agreements. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of Laidlaw
or any of its affiliates at or subsequent to the Date of Termination shall be
payable in accordance with such plan or program.
ARTICLE 12 -- FULL SETTLEMENT
Except as provided in Article 7, Laidlaw's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
Laidlaw may have against the Executive or others whether by reason of the
subsequent employment of the Executive or otherwise. In no event shall the
Executive be obligated to seek other employment by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement.
Without otherwise limiting the purpose or effect of this Article 12, employee
benefits (as described in Section 2 of Annex A) otherwise receivable by the
Executive pursuant to Section 2 of Annex A will be reduced to the extent
comparable welfare benefits are actually received by the Executive from another
employer during the Continuation Period (as defined in Annex A) following the
Executive's Date of Termination, and any such benefits actually received by the
Executive shall be reported by the Executive to Laidlaw.
ARTICLE 13 -- POST-TERMINATION ASSISTANCE
Executive shall provide such information and assistance to Laidlaw as Laidlaw
may reasonably request, upon reasonable notice, in connection with any
litigation in which it or any of its affiliates is or may become a party.
Laidlaw shall reimburse the Executive for any expenses, including travel
expenses, incurred by the Executive in connection with providing such
information and assistance.
ARTICLE 14 -- ASSIGNMENT OF RIGHTS
(a) Laidlaw will require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of Laidlaw, by agreement in
form and substance reasonably satisfactory to the Executive, expressly to
assume and agree to perform this Agreement in the same manner and to the
same extent Laidlaw would be required to perform if no such succession had
taken place. This Agreement will be binding upon and inure to the benefit
of Laidlaw and any successor to Laidlaw, including, without limitation, any
persons acquiring directly or indirectly all or substantially all of the
business or assets of Laidlaw whether by purchase, merger, consolidation,
reorganization or otherwise (and such successor shall thereafter be deemed
"Laidlaw" for the purposes of this Agreement), but will not otherwise be
assignable, transferable or delegable by Laidlaw.
17
(b) This Agreement will inure to the benefit of and be enforceable by the
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees.
(c) This Agreement is personal in nature and neither of the parties hereto
shall, without the consent of the other, assign, transfer or delegate this
Agreement or any rights or obligations hereunder except as expressly
provided in Sections (a) and (b) hereof. Without limiting the generality or
effect of the foregoing, the Executive's right to receive payments
hereunder will not be assignable, transferable or delegable, whether by
pledge, creation of a security interest, or otherwise, other than by a
transfer by Executive's will or by the laws of descent and distribution
and, in the event of any attempted assignment or transfer contrary to this
Section (c), Laidlaw shall have no liability to pay any amount so attempted
to be assigned, transferred or delegated.
ARTICLE 15 -- NOTICES
All notices and other communications required or permitted hereunder, or
necessary or convenient in connection herewith, shall be in writing and shall be
deemed to have been given when hand delivered, delivered by facsimile or mailed
by registered mail as follows (provided that notice of change of address shall
be deemed given only when received):
If to Laidlaw, to:
General Counsel
Laidlaw International, Inc.
55 Shuman Boulevard, Suite 400
Naperville, IL 60563
If to the Executive, at such address as Executive provides to Laidlaw from time
to time as part of her personnel records, or to such other names or addresses as
Laidlaw or the Executive shall designate by notice to the other in the manner
specified in this Article 15.
ARTICLE 16 -- LIABILITY INSURANCE
Laidlaw shall maintain the Executive's liability insurance in accordance with
Laidlaw's corporate policy and applicable law.
ARTICLE 17 -- INDEMNIFICATION
Laidlaw agrees that if the Executive is made a party to any action, suit,
proceeding or any other claim whatsoever, by reason of the fact that the
Executive is or was a director, officer, employee or agent of Laidlaw, or is or
was serving at the request of Laidlaw as a director, officer, employee or agent
of another Laidlaw, partnership, joint venture, trust or other enterprise,
including acting as a fiduciary of an employee benefit plan of Laidlaw or one of
its Affiliates, whether or not the basis of such claim is the Executive's
alleged action in an official capacity while in service as a director, officer,
employee or agent of Laidlaw or fiduciary of such employee benefit plan, the
Executive shall be indemnified and held harmless by Laidlaw to the
18
fullest extent legally permitted or authorized by Laidlaw's certificate of
incorporation or bylaws or Board resolutions against all expenses, liability and
loss, including, without limitation, legal fees, fines or penalties and amounts
paid or to be paid in settlement, all as reasonably incurred by the Executive in
connection therewith, and such indemnification shall continue as to the
Executive even after the Executive has ceased to be a director, officer,
employee or agent of Laidlaw or fiduciary of such employee benefit plan, and
shall inure to the benefit of the Executive's heirs, executors and
administrators.
ARTICLE 18 -- LEGAL FEES AND EXPENSES
It is the intent of Laidlaw that the Executive not be required to incur legal
fees and the related expenses associated with the interpretation, enforcement or
defense of the Executive's rights under this Agreement with respect to any
termination of the Executive's employment occurring during the two (2) year
period commencing on a Change in Control, by litigation or otherwise because the
cost and expense thereof would substantially detract from the benefits intended
to be extended to the Executive hereunder. Accordingly, if the Executive
reasonably believes that Laidlaw has failed to comply with any of its
obligations under this Agreement during the two (2) year period commencing on
the date of a Change in Control or in the event that Laidlaw or any other person
takes or threatens to take any action to declare this Agreement void or
unenforceable, or institutes any litigation or other action or proceeding
designed to deny, or to recover from, the Executive the benefits provided or
intended to be provided to the Executive hereunder, subject to the other
provisions of this Article 18, Laidlaw irrevocably authorizes the Executive from
time to time to retain counsel of the Executive's choice, at the expense of
Laidlaw to the extent and as hereafter provided, to advise and represent the
Executive in connection with any such interpretation, enforcement or defense,
including, without limitation, the initiation or defense of any litigation or
other legal action, whether by or against Laidlaw or any director, officer,
stockholder or other person affiliated with Laidlaw, in any jurisdiction.
Notwithstanding any existing or prior attorney-client relationship between
Laidlaw and such counsel, Laidlaw irrevocably consents to the Executive's
entering into an attorney-client relationship with such counsel, and in that
connection Laidlaw and the Executive agree that a confidential relationship
shall exist between the Executive and such counsel. Laidlaw will pay and be
solely responsible for any and all attorneys' and related fees and expenses
incurred by the Executive in connection with any of the foregoing, except to the
extent that the Executive fails to prevail on a material claim in any such
proceeding described in this Article 18.
ARTICLE 19 -- SURVIVAL
The provisions of this Agreement which are intended to be performed following
the termination of the Executive's employment with Laidlaw and/or the expiration
or earlier termination of the term of this Agreement, shall survive such
termination, expiration or earlier termination, including without limitation the
provisions of Articles 6, 7, 10, 13, 17 and 18.
ARTICLE 20 -- WITHHOLDING OF TAXES
Laidlaw shall be entitled to withhold from any amounts payable under this
Agreement all taxes as legally shall be required pursuant to applicable federal,
state or local laws. Except as otherwise provided in this Agreement, Laidlaw
shall not be obligated to compensate the Executive for the payment of such
taxes.
19
ARTICLE 21 -- SEVERABILITY
If any provision of this Agreement or the application thereof to anyone, or
under any circumstances, is adjudicated to be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect any other
provision or application of this Agreement which can be given effect without the
invalid or unenforceable provision or application and shall not invalidate or
render unenforceable such provision or application in any other jurisdiction. If
any provision of this Agreement or the application of any provision hereof to
any person or circumstances is held invalid, unenforceable or otherwise illegal,
the provision so held to be invalid, unenforceable or otherwise illegal will be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid or legal.
ARTICLE 22 -- ENTIRE AGREEMENT
This Agreement, including Annex A hereto, constitutes the entire agreement
between the parties with respect to the employment and appointment of the
Executive and any and all previous agreements, written or oral, express or
implied, between the parties or on their behalf, relating to the employment and
appointment of the Executive by Laidlaw, are terminated and cancelled and each
of the parties releases and forever discharges the other of and from all manner
of actions, causes of action, claims and demands whatsoever, under or in respect
of any previous agreement; provided, however, that this does not terminate or
cancel the separate indemnification agreement between Laidlaw and the Executive.
ARTICLE 23 -- AMENDMENT, WAIVER, ETC.
No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by the
Executive and Laidlaw. No waiver by any party hereto at any time of any breach
by any other party hereto of, or compliance with, any condition of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.
ARTICLE 24 -- HEADINGS
The headings used in this Agreement are for convenience only and are not to be
construed in any way as additions to or limitations of the covenants and
agreements contained in it.
ARTICLE 25 -- COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and
the same instrument.
ARTICLE 26 -- GENDER AND NUMBER
Except where otherwise indicated by the context, any masculine term used herein
shall also include the feminine; the plural shall include the singular, the
singular shall include the plural.
20
ARTICLE 27 -- GOVERNING LAW
This Agreement shall be governed by the internal law, and not the laws of
conflicts, of the State of Delaware.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the 1st day
of August, 2006.
LAIDLAW INTERNATIONAL INC.
BY: /S/ KEVIN E. BENSON
------------------------------------
NAME: KEVIN E. BENSON
TITLE: PRESIDENT AND CHIEF EXECUTIVE
OFFICER
EXECUTIVE
/s/ Mary B. Jordan
----------------------------------------
MARY B. JORDAN
21
ANNEX A
1. Laidlaw shall pay to the Executive a lump sum payment in an amount equal
to two (2) times the sum of (A) Base Salary (at the highest rate in effect for
any period prior to the Date of Termination), plus (B) Annual Bonus (in an
amount equal to not less than the higher of (x) the highest aggregate Annual
Bonus earned in any fiscal year after the Change in Control or in any of the
three (3) fiscal years immediately preceding the year in which the Change in
Control occurred or (y) the Target Bonus for the year in which the Change in
Control occurred).
2. Laidlaw shall, for a period of twenty-four (24) months following the
Termination Date (the "Continuation Period"), arrange to provide the Executive
with Employee Benefits that are welfare benefits within the meaning of Section
3(1) of the Employee Retirement Income Security Act of 1974, as amended,
substantially similar to those that the Executive was receiving or entitled to
receive immediately prior to the Date of Termination (or, if greater,
immediately prior to the reduction, termination or denial described in
Subsection (ii) of Section (o) of Article 1 of the Agreement), at the expense of
Laidlaw with respect to all such benefits other than medical or dental benefits,
except that the level of any such Employee Benefits to be provided to the
Executive may be reduced in the event of a corresponding reduction generally
applicable to all recipients of or participants in such Employee Benefits. With
respect to medical and dental benefits, the Executive (and her eligible
dependents) will be entitled to continue to participate in such plans during the
Continuation Period (which continuation shall count toward any required COBRA
continuation) at the Executive's sole expense based on COBRA rates charged from
time to time; provided, however, that Laidlaw shall pay to the Executive at the
time payment is made of the amount in Section 1 of this Annex, an amount equal
to the full COBRA cost of such coverage during the Continuation Period. Without
otherwise limiting the purpose or effect of Article 12 of the Agreement,
Employee Benefits otherwise receivable by the Executive pursuant to this Section
2 (but not the amount paid by Laidlaw for medical and dental coverage) will be
reduced to the extent comparable welfare benefits are actually received by the
Executive from another employer during the Continuation Period following the
Executive's Date of Termination, and any such benefits actually received by the
Executive shall be reported by the Executive to Laidlaw.
Notwithstanding the foregoing, in the event that a plan or program
providing any such welfare benefit does not allow for the continuation of such
benefit and either cannot be amended without adverse tax consequences to
participants or the insurance company providing such benefit is unwilling to
provide for such continuation, then Laidlaw shall pay to the Executive, at the
same time as payment of the amount under Section 1 of this Annex is made, an
amount equal to the cost to Laidlaw, determined at the cost as of the date of
such payment, of providing such benefit for the Continuation Period, and
thereafter Laidlaw shall have no obligation to provide such benefit to the
Executive.
3. The Continuation Period will be considered service with Laidlaw for the
purpose of determining vesting for the Executive under Laidlaw's retirement
income, supplemental executive retirement and other benefit plans of Laidlaw
applicable to the Executive, except to the extent that to do so would jeopardize
the tax-qualified status of any such plan.
4. In addition to the retirement income, supplemental executive retirement,
and other benefits to which the Executive is entitled under the Retirement
Plans, a lump sum payment in an
22
amount equal to the actuarial equivalent of the excess of (x) the retirement
pension and the medical, life and other benefits that would be payable to the
Executive under the Retirement Plans if the Executive continued to be employed
through the Continuation Period given the Executive's Base Salary (as determined
in Section 1 hereof) (without regard to any amendment to the Retirement Plans
made subsequent to a Change in Control which adversely affects in any manner the
computation of retirement or welfare benefits thereunder), over (y) the
retirement pension and the medical, life and other benefits that the Executive
is entitled to receive (either immediately or on a deferred basis) under the
Retirement Plans. For purposes of this Section, "actuarial equivalent" shall be
determined using the actuarial assumptions mandated under Code Section 417(e)(3)
in effect for the month second preceding the date of payment and the
Continuation Period will be considered service with Laidlaw for the purpose of
determining vesting, service credits and benefits under clause (x) hereof.
5. Reasonable outplacement services by a firm selected by the Executive, at
the expense of Laidlaw, in an amount up to Twenty-Five Thousand Dollars
($25,000.00).
23