EXHIBIT 10.1
This Agreement made
effective the 1st day of January, 2005.
Among:
Greyhound Lines, Inc., a
Delaware corporation (“Greyhound”),
Laidlaw International, Inc., a Delaware corporation
(“Laidlaw”)
and
John Werner Haugsland
(the “Executive”)
WHEREAS, Executive
is currently employed by Greyhound pursuant to the terms of the
Second Amended Executive Employment Agreement dated as of
March 16, 1999, as amended (the “Prior
Agreement”); and
WHEREAS , Greyhound
desires to continue the employment of Executive and the Executive
desires to continue to be employed by Greyhound pursuant to the
terms of this Agreement;
WHEREAS, Greyhound
is a wholly owned subsidiary of Laidlaw;
WHEREAS, Greyhound,
Laidlaw and Executive desire to terminate the Prior 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:
(a) “Agreement”
means this employment agreement, as amended from time to time.
(b)
“Base Salary” means the salary of record paid to the
Executive as annual salary, and as further indicated in paragraph
(a) of Article 4 (Compensation).
(c) “Board”
means the Board of Directors of Laidlaw.
(d) “Cause”
means the Executive’s:
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(i) |
Willful and continued failure to perform substantially the
Executive’s primary duties with Greyhound after Greyhound
delivers to the Executive written demand for substantial
performance, specifically identifying the manner in which the
Executive has not substantially performed his duties; |
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(ii) |
Act of omission constituting fraud under the law of the State
of Texas; |
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(iii) |
Conviction of, or plea of nolo contendere to a
felony; |
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(iv) |
Use of illegal drugs; |
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(v) |
Embezzlement of Greyhound or Laidlaw property or funds; |
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(vi) |
Material breach of any provision of this Agreement, including
but not limited to the covenants set forth in Section 6(d), or
the unauthorized use of Greyhound’s confidential business
information in a manner which is detrimental to Greyhound and/or
Laidlaw. |
(e) “Committee”
means the Compensation Committee of the Board.
(f)
“Disability” means Executive becomes
“disabled,” as that term is defined in the Greyhound
Lines, Inc. Employee Long Term Disability Plan (“the LTD
Plan”), and is unable to perform the essential functions of
his position, with reasonable accommodation, for a period of one
hundred eighty (180) consecutive days after becoming so
disabled.
(g) “Effective
Date” means January 1, 2005.
(h) “Executive”
shall mean John Werner Haugsland.
(i) “Good
Reason” shall mean, without the consent of the Executive:
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(i) |
Greyhound’s failure to perform any material provision of
this Agreement; |
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(ii) |
A material change in the Executive’s authority, duties or
responsibilities under this Agreement, other than a termination by
Greyhound for Cause; |
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(iii) |
Any request by the Greyhound Board that the Executive perform,
assist, abet or approve any act which is illegal under any federal,
state or local law; |
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(iv) |
Any requirement by the Greyhound Board that Executive relocate
from the Dallas, Texas metropolitan area; or |
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(v) |
Greyhound fails to maintain adequate liability insurance
coverage or indemnify executive in accordance with Articles 12 and
13 of this Agreement, |
(j) “Greyhound”
shall mean Greyhound Lines, Inc., a Delaware corporation, and all
subsidiaries or any successor thereto.
(k) “Greyhound
Board” shall mean the Board of Directors of Greyhound.
(l) “Laidlaw”
shall mean Laidlaw International Inc., a Delaware corporation,
including any and all subsidiaries or any successor thereto.
Article 2 —
Term of the Agreement
The term of this Agreement
shall commence on the Effective Date and shall continue until
January 31, 2007, unless otherwise terminated earlier in accordance
with the provisions of this Agreement.
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Article 3 —
Title; Commencement of Employment; Reporting
The Executive shall serve
as the Executive Vice President and Chief Operating Officer of
Greyhound. The Executive shall report to the President and Chief
Executive Officer of Greyhound.
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 his services is established by the Committee at the
annualized rate of $378,562. The Base Salary shall be payable twice
monthly on the 15 th business day
and the last business day of each month. The Base Salary shall be
reviewed annually during Greyhound’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. |
| (b) |
The Executive will be eligible to participate in
Greyhound’s Short Term Incentive Plan as approved by the
Committee. For fiscal years commencing September 1, 2003 and
thereafter, the Executive’s target bonus shall be 50% of Base
Salary and the maximum bonus shall be 100% of Base Salary. The
Executive’s right to receive any bonus under
Greyhound’s Short Term Incentive Plan shall be determined
based only upon quantitative measurements established by the
Committee and as set forth in accordance with Greyhound’s
Short Term Incentive Plan. |
| (c) |
The Executive shall participate in the Greyhound Supplemental
Executive Retirement Plan sponsored by Greyhound for the benefit of
its employees in accordance with its terms; provided that Executive
shall be credited with all service with Greyhound and any
predecessors for purposes of the Greyhound Supplemental Executive
Retirement Plan. |
| (d) |
Subject to approval by the Committee, the Executive will be
eligible to receive grants of stock options of Laidlaw from time to
time. Such stock options will be on terms and conditions
established by the Committee. |
| (e) |
For the fiscal year commencing September 1, 2004,
Greyhound will recommend to the Committee grants of deferred shares
and value appreciation rights (VARs) to Executive under the terms
of the Laidlaw Plan in the amount double the amount to be granted
by the Committee in November, 2004. Such recommendation shall
include four year ratable vesting on the deferred shares and 3-year
cliff vesting on the VARs, with acceleration of vesting upon death
or disability. The deferred shares will vest upon retirement, as
defined in the Laidlaw Plan. VARs shall continue to vest for so
long as Executive remains either employed by Greyhound or as a
member of the Greyhound Board. All grants of deferred shares and
VARs are subject to such terms and conditions as the Committee may
actually approve and the Laidlaw Plan. There will be no other
grants of deferred shares or VARs during the term of the
Agreement. |
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Article 5 —
Benefits
| (a) |
Automobile |
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Greyhound will provide the Executive with a monthly allowance
of One Thousand Dollars ($1,000.00) for expenses incurred by the
Executive for an automobile. |
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| (b) |
Expenses |
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It is understood and agreed that the Executive will incur
expenses in connection with his duties under this Agreement,
including, but not limited to, travel expenses, home facsimile
expenses, personal computer expenses and telephone expenses.
Greyhound shall reimburse the Executive for any such expenses
provided that the Executive provides to Greyhound an itemized
written account and receipts acceptable to Greyhound. |
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| (c) |
Vacation |
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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 is forfeited. |
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| (d) |
Welfare Benefits |
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The Executive shall be entitled to those welfare benefit
coverages as are offered by Greyhound to its executive 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 Greyhound for the benefit of employees of Greyhound,
and as amended from time to time subject to and supplemented by the
following: |
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(i) |
Medical : Greyhound shall pay the full cost of health
and welfare benefit coverages for Executive. Greyhound will
reimburse Executive for medical expenses up to $5,000 per calendar
year; provided, that Executive provides to Greyhound appropriate
evidence of such expenses as acceptable to Greyhound. Additionally,
Greyhound will reimburse Executive for the cost of an annual
physical performed by a mutually agreed upon physician. |
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(ii) |
Life Insurance : At all times during the term of this
Agreement, Executive will receive life insurance coverage as
provided by Greyhound on terms not less favorable than that
provided to other executives of Greyhound. In addition to any life
insurance provided pursuant to the preceding sentence, the
Executive will be provided with company-paid life insurance which
will provide death benefits in the event of his death in an amount
of at least $1,500,000.00 payable to the beneficiary or
beneficiaries named by the Executive. Greyhound shall have the
right to purchase insurance to fund its obligations to the
Executive under this section; provided, |
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however, that any insurance company or companies selected by
Greyhound to fund its obligations under this section must be the
company or companies that underwrite life insurance benefits
covering other officers of Greyhound. |
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(iii) |
Long Term Disability : Greyhound will provide Executive
long-term disability coverage and benefits on terms which are not
less favorable than that provided to other executives of Greyhound
but which will provide an annual disability benefit to the
Executive of at least fifty percent (50%) of his expected annual
Base Salary, payable for the year during which Executive was
disabled. |
| (e) |
Club Memberships |
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Greyhound will reimburse the Executive for the initial
membership fees associated with joining a mutually agreed upon club
that the Executive will use in connection with Greyhound’s
business. Greyhound will also reimburse the Executive for ongoing
annual dues incurred by the Executive in connection with the
Executive’s membership in such club. Greyhound will also
reimburse the Executive for monthly dues of up to $250 per month
for one health club. |
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| (f) |
Professional Expenses |
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Greyhound will reimburse the Executive for up to Fifteen
Thousand Dollars ($15,000.00) annually for expenses incurred by the
Executive in connection with the Executive’s estate planning,
tax and financial preparation and planning. |
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: |
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(i) |
By the Executive, at any time without Good Reason, on the
giving of 90 days’ written notice to Greyh |
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