This Agreement made effective the 24 th day of
January, 2007.
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.
WHEREAS , Laidlaw and Executive entered into an
Employment Agreement dated August 1, 2006 (the
“Employment Agreement”); and
WHEREAS , Laidlaw and Executive intend to amend and
restate and replace the Employment Agreement with this
Agreement
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:
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(a)
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“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.
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(b) “Agreement” means this employment
agreement, as amended from time to time.
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(c)
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“Annual Bonus” means the annual
bonus under Laidlaw’s Short Term Incentive Plan or any
successor annual incentive plan.
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(d)
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“Base Salary” means the salary of
record paid to the Executive as annual salary, and as further
indicated in Section (a) of Article 4.
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(e)
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“Board” means the Board of
Directors of Laidlaw.
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(i)
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the continuous and willful failure or refusal
by the Executive to perform the Executive’s material duties
and responsibilities of her position with Laidlaw (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;
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(ii)
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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;
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(iii)
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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;
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(iv)
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the conviction of the Executive of, or the
entering of a plea of nolo contendere by, the Executive with
respect to a felony; or
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(v)
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Executive’s breach of the provisions of
Article 7 of this Agreement.
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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.
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(g)
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“Change in Control” means the
occurrence during the term of this Agreement of any of the
following events:
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(i)
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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
pursuant to a transaction that complies with clauses (A),
(B) and (C) of Subsection (iii) of this Section
(g);
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(ii)
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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;
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(iii)
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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
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(iv)
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approval by the stockholders of Laidlaw of a
complete liquidation or dissolution of Laidlaw.
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(h) “Code” means the Internal Revenue Code of
1986, as amended.
(i) “Committee” means the Human Resources and
Compensation Committee of the Board.
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(j)
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“Date of Termination” has the
meaning ascribed to such term in Section (e) of
Article 6.
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(k) “Effective Date” means the date first above
written.
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(l)
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“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.
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(m)
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“Exchange Act” means the
Securities Exchange Act of 1934.
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(n)
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“Executive” means Mary B.
Jordan.
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(o)
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“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):
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(i)
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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;
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(ii)
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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;
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(iii)
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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;
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(iv)
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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
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(v)
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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.
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(p)
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“Laidlaw” means Laidlaw
International Inc., a Delaware corporation.
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(q)
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“Notice of Termination” has the
meaning ascribed to such term in Section (d) of
Article 6.
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(r)
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“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.
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(s)
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“Subsidiary” means an entity in
which Laidlaw directly or indirectly beneficially owns fifty
percent (50%) or more of the outstanding Voting Stock.
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(t)
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“Target Bonus” has the meaning
ascribed to such term in Section (b) of Article 4.
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(u)
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“Voting Stock” means securities
entitled to vote generally in the election of directors.
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Article 2 — Term of the
Agreement
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The term of this Agreement shall commence on the Effective Date
and shall continue until terminated in accordance with the
provisions of this Agreement (the “Term”).
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
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(a)
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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 the
Committee at the annualized rate of Three Hundred and Twelve
Thousand Dollars ($312,000.00). The Base Salary shall be payable
twice monthly on the fifteenth (15 th ) 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.
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(b)
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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 seventy five percent (75%) of Base Salary
(the “Target Bonus”) and the maximum bonus shall be no
less than one hundred fifty percent (150%) 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.
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(c)
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The Executive shall participate in the
Supplemental Executive Retirement Plan sponsored by Laidlaw for the
benefit of its employees.
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(d)
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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.
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(a)Laidlaw shall 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.
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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.
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 by
the Executive shall be governed by Laidlaw’s vacation
policies and other similar benefit policies Laidlaw has in place,
from time to time.
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.
Laidlaw will reimburse the Executive
for up to Forty Thousand Dollars ($40,000.00) of expenses incurred
by the Executive for the initial membership fees associated with
joining one business club and one recreational 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 and recreational club. Laidlaw may modify, reduce or eliminate
such allowance in accordance with any uniform modification
affecting similarly situated executives of Laidlaw who receive such
allowance.
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(f)
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Professional Expenses
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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. Laidlaw may modify, reduce
or eliminate such allowance in accordance with any uniform
modification affecting similarly situated executives of Laidlaw who
receive such allowance.
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(g)
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Post-termination Relocation
Reimbursement
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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.
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(h)
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Change in Control Vesting
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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.
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Article 6 — Termination of
Employment
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(a)
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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:
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(i)
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The Executive’s employment hereunder
shall automatically terminate upon the death of the Executive.
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(ii)
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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 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.
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(iii)
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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.
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(iv)
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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.
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(v)
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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, (E) 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) and (F) 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
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(I)
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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
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(II)
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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.
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(vi)
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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.
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(b)
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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.
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(c)
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In order to receive the entitlement under
Subsection (vi) of Section (a) hereof, or Clauses (A),
(B), (C), (D), and (E) 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.
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(d)
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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.
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(e)
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“Date of Termination” shall mean
(i) i
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