<PAGE>
AMENDED AND RESTATED
SEVERANCE AND CHANGE IN CONTROL AGREEMENT
This Amended and Restated Severance and Change in Control
Agreement ("Agreement") made and entered into as of the 11th
day of April, 2000, by and between AAR CORP., a Delaware
corporation ("Company"), and Howard A. Pulsifer ("Employee").
WHEREAS, the Company currently employs Employee as an employee at will in the
capacity of Vice President, General Counsel and Secretary; and
WHEREAS, the Company and Employee entered into a Severance and Change in Control
Agreement dated February 24, 1995 ("Agreement"); and
WHEREAS, the Company and Employee amended and restated the Agreement as of the
8th day of April, 1997, and further amended the Agreement as of the 14th day of
July, 1998 ("Original Agreement"); and
WHEREAS, the Company and Employee desire to further amend the Agreement as
herein set forth to reflect certain mutually agreed changes to the terms and
conditions thereof; and
WHEREAS, for their mutual convenience, the Company and Employee desire to
restate the Agreement, as so amended, in its entirety.
NOW, THEREFORE, in consideration of the mutual agreements herein set forth and
other good and valuable consideration, the parties hereto agree as follows:
1. EMPLOYMENT. Employee will continue employment with the Company as an at
will employee subject to the terms and conditions hereinafter set
forth.
2. DUTIES. During the continuation of Employee's employment, Employee
shall:
(a) well and faithfully serve the Company and do and perform
assigned duties and responsibilities in the ordinary course of
Employee's employment and the business of the Company (within
such limits as the Company may from time to time prescribe),
professionally, faithfully and diligently.
(b) devote Employee's full time, energy and skill to the business
of the Company and Employee's assigned duties and
responsibilities, and to the promotion of the best interests
of the Company; provided that Employee shall not (to the
extent not inconsistent with Section 5 below) be prevented
from (a) serving as a director of any corporation consented to
in advance in writing by the Company, (b) engaging in
charitable, religious, civic or other non-profit community
activities, or (c) investing his personal assets in such form
or manner as will not require any substantial services on
Employee's part in the operation or affairs of the business in
which such
1
<PAGE>
investments are made or which would detract from or interfere
or cause a conflict of interest with performance of Employee's
duties hereunder.
(c) observe all policies and procedures of the Company in effect
from time to time applicable to employees of the Company
including, without limitation, policies with respect to
employee loyalty and prohibited conflicts of interest.
3. BENEFITS. Employee shall be entitled to participate, according to the
eligibility provisions of each, in such welfare plans (including but
not limited to medical, dental, life, accident and disability insurance
programs), vacation, retirement plans and other fringe benefits as may
be in effect from time to time and available to other officers of the
Company during Employee's employment term. Employee shall also be
entitled to participate in such additional executive fringe benefits as
may be authorized from time to time by the President and Chief
Executive Officer of the Company. Employee shall be eligible to
participate in the Company's Supplemental Key Employee Retirement Plan
as an executive level participant.
4. CONFIDENTIAL INFORMATION, ASSIGNMENT OF INVENTIONS.
(a) Employee acknowledges that the trade secrets, confidential
information, secret processes and know-how developed and
acquired by AAR CORP. and its affiliates or subsidiaries
(together the "Affiliated Companies") are among their most
valuable assets and that the value of such information may be
destroyed by unauthorized disclosure. All such trade secrets,
confidential information, secret processes and know-how
imparted to or learned by Employee in the course of his
employment with respect to the business of the Affiliated
Companies (whether acquired before or after the date hereof)
will be deemed to be confidential and will not be used or
disclosed by Employee, except to the extent necessary to
perform Employee's duties and, in no event, disclosed to
anyone outside the employ of the Affiliated Companies and
their authorized consultants and advisors, unless (i) such
information is or has been made generally available to the
public, (ii) disclosure of such information is required by law
in the opinion of Employee's counsel (provided that written
notice thereof is given to Company as soon as possible but not
less than 24 hours prior to such disclosure), or (iii) express
written authorization to use or disclose such information has
been given by the Company. If Employee ceases to be employed
by the Company for any reason, Employee shall not take any
electronically stored data, documents or other papers
containing or reflecting trade secrets, confidential
information, secret processes, know-how, or computer software
programs from Company. Employee acknowledges that Employee's
employment hereunder will place Employee in a position of
utmost confidence and that Employee will have access to
confidential information concerning the operation of the
business of the Affiliated Companies, including, but not
limited to, manufacturing methods, developments, secret
processes, know-how, computer software programs, costs, prices
and pricing methods, sources of supply and customer names and
relations. All such information is in the nature of a trade
secret and is the sole and exclusive property of the
Affiliated Companies and shall be deemed confidential
information for the purposes of this paragraph.
2
<PAGE>
(b) Employee hereby assigns to the Company all rights that
Employee may have as author, designer, inventor or otherwise
as creator of any written or graphic material, design,
invention, improvement, or any other idea or thing whatever
that Employee may write, draw, design, conceive, perfect, or
reduce to practice during employment with the Company or
within 120 days after termination of such employment, whether
done during or outside of normal work hours, and whether done
alone or in conjunction with others ("Intellectual Property"),
provided, however, that Employee reserves all rights in
anything done or developed entirely by Employee on Employee's
own personal time and without the use of any Company
equipment, supplies, facilities or information, or the
participation of any other Company employee, unless it relates
to the Company's business or reasonably anticipated business,
or grows out of any work performed by Employee for the
Company. Employee will promptly disclose all such Intellectual
Property developed by Employee to the Company, and fully
cooperate at the Company's request and expense in any efforts
by the Company or its assignees to secure protection for such
Intellectual Property by way of domestic or foreign patent,
copyright, trademark or service mark registration or
otherwise, including executing specific assignments or such
other documents or taking such further action as may be
considered necessary to vest title in Company or its assignees
and obtain patents or copyrights in any and all countries.
5. NON-COMPETE; SEVERANCE.
(a) Employee agrees that during Employee's continuation of
employment with the Company and for one (1) year thereafter so
long as the Company makes severance payments to Employee
pursuant to subsections 5(b) or 5(c) below, Employee shall
not, without the express written consent of the Company,
either alone or as a consultant to, or partner, employee,
officer, director, or stockholder of any organization, entity
or business, (i) take or convert for Employee's personal gain
or benefit or for the benefit of any third party, any business
opportunities which may be of interest to the Company or any
Affiliated Company which Employee becomes aware of during the
term of his employment; (ii) engage in direct or indirect
competition with the Company or any Affiliated Company within
100 miles of any location within the United States of America
or any other country where the Company or any Affiliated
Company does business from time to time during the term
hereof; (iii) solicit in connection with any activity which is
competitive with any of the businesses of the Company or any
Affiliated Company, any customers of the Company or any
Affiliated Company; (iv) solicit for employment any sales,
marketing or management employee of Company or any Affiliated
Company or induce or attempt to induce any customer or
supplier of the Company or any Affiliated Company to terminate
or materially change such relationship. Company and Employee
acknowledge the reasonableness of the foregoing covenants not
to compete and non-solicitation, including but not limited to
the geographic area and duration of time which are a part
hereof, and further, that the restrictions stated in this
Section 5 are reasonably necessary for the protection of
Employer's legitimate proprietary interests. This covenant not
to compete may be enforced with respect to any geographic area
in which the Company or any Affiliated Company does business
during the term hereof. Nothing herein shall prohibit Employee
from being
3
<PAGE>
the legal or equitable holder, solely for investment purposes,
of less than 5% of the capital stock of any publicly held
corporation which may be in direct or indirect competition
with the Company or any Affiliated Company.
(b) The Company will pay Employee, upon termination of Employee's
employment by the Company prior to a Change in Control (as
defined in 7(c)(i) below) for any reason other than Cause (as
defined in 7(c)(iv) below), severance each month for 12
months, in an amount (subject to applicable withholding) equal
to 1/12 of Employee's base salary; and, further, if the
Company pays discretionary bonuses to its officers for the
fiscal year in which Employee's employment is terminated,
Employee will be paid a bonus in a lump sum at the time any
such bonuses are paid to other officers or at such time as the
Severance Period is complete, whichever is later (with
interest at prime rate plus one percentage point from the
earlier of such dates), (1) for the completed fiscal year
preceding termination if such bonus has not been paid prior to
termination, and (2) for the fiscal year in which employment
is terminated, prorata for the period prior to termination of
employment based on Employee's performance during such period;
provided, however, that (i) all such monthly payment
obligations shall terminate immediately upon Employee
obtaining full time employment in a comparable position in
terms of salary level, and (ii) all such payment obligations
shall terminate or lapse immediately upon any breach by
Employee of Section 4 or 5(a) of this Agreement or if Employee
shall commence any action or proceeding in any court or before
any regulatory agency arising out of or in connection with
termination of Employee's employment.
(c) If Employee terminates Employee's employment or Employee's
employment is terminated by the Company for Cause (as defined
below), the Company may elect (but is not required to), by
written notice thereof to Employee, within five (5) days of
any such termination of Employee's employment with the Company
prior to a Change in Control (as defined below), to pay
Employee severance as provided in and subject to the
provisions of subsection 5(b) above.
(d) Employee may terminate this Severance and Change in Control
Agreement effective immediately upon notice thereof in writing
to Company at any time while still employed within a sixty
(60) calendar day period immediately following the effective
date of any reduction by Company in (i) Employee's level of
responsibility or position from that held by Employee as Vice
President, General Counsel and Secretary on the effective date
of this Agreement, or (ii) Employee's level of compensation,
including retirement benefits in effect immediately prior to
any such change.
(e) If at any time, any clause or portion of this Section 5 shall
be deemed invalid or unenforceable by the laws of the
jurisdiction in which it is to be enforced by reason of being
vague or unreasonable as to duration, geographic scope, nature
of activities restricted, or for any other reason, this
provision shall be considered divisible as to such portions
and the foregoing restrictions set forth in 5(a) shall become
and be immediately amended to include only such duration,
scope or restriction and such event as shall be deemed
reasonable and enforceable by the court or other body having
jurisdiction to enforce this Agreement; and the parties hereto
agree that the
4
<PAGE>
restrictions, as so amended, shall be valid and binding as
though the invalid or unenforceable portion had not been
involved herein.
(f) The Employee acknowledges and agrees that the Company would be
irreparably harmed by violations of Section 4 or Section 5(a)
above, and in recognition thereof, the Company shall be
entitled to an injunction or other decree of specific
performance with respect to any violation thereof (without any
bond or other security being required) in addition to other
available legal and equitable remedies.
6. TERMINATION OF EMPLOYMENT.
(a) Upon and after termination of employment howsoever arising,
Employee shall, upon request by Company:
(1) immediately return to the Company all correspondence,
documents, business calendars/diaries, or other
property belonging to the Company which is in
Employee's possession,
(2) immediately resign from any office Employee holds
with the Company or any Affiliated Company; and
(3) cooperate fully and in good faith with the Company in
the resolution of all matters Employee worked on or
was involved in during Employee's employment with the
Company. Employee's cooperation will include
reasonable consultation by telephone. Further, in
connection therewith, Employee will, at Company's
request upon reasonable advance notice and subject to
Employee's availability, make Employee available to
Company in person at Company's premises, for
testimony in court, or elsewhere; provided, however,
that in such event, Company shall reimburse all
Employee's reasonable expenses and pay Employee a
reasonable per diem or hourly stipend.
7. CHANGE IN CONTROL.
(a) In the event (i) a Change in Control of AAR CORP. occurs and
(ii) (A) at any time during the 18 month period commencing on
the date of the Change in Control the Company terminates
Employee's employment for other than Cause or Disability, or
Employee terminates Employee's employment for Good Reason, in
either case by written notice to the other party (including
the particulars thereof), and having given the other party the
opportunity to be heard with respect thereto, or (B)
Employee's employment with the Company terminates for any
reason other than Disability or death during the 30 day period
commencing on the expiration of the aforementioned 18 month
period, then:
(1) The Company shall promptly pay to Employee, in a lump
sum, a cash payment in an amount equal to the sum of
(A) all base salary earned through the date of
termination, (B) any annual cash bonus earned by
Employee for the fiscal year of the Company most
recently ended prior to the date of
5
<PAGE>
termination to the extend unpaid on the date of
termination, (C) a prorata portion of the annual cash
bonus, including the value of any restricted stock
grant in lieu of annual cash bonus, Employee would
have earned had Employee been employed by the Company
on the last day of the fiscal year in which the date
of termination occurs (as if all performance targets
have been met or, in the event the bonus is of the
"discretionary" type, the bonus shall be based on a
percentage of base salary which is not less than
percentage of base salary received as bonus for the
preceding fiscal year) that is applicable to the
period commencing on the first day of such fiscal
year and ending on the date of termination, and (D)
any and all other benefits and amounts earned by
Employee prior to the date of termination to the
extent unpaid, all subject to applicable withholding.
(2) The Company shall promptly pay to Employee in a lump
sum, a cash payment in an amount equal to three times
Employee's total compensation (base salary plus
annual cash bonus) for either the fiscal year of the
Company most recently ended prior to the date of
termination, or the preceding fiscal year, whichever
is the highest total compensation, subject to
applicable withholding. Employee may elect to take
payment of any amounts on a schedule of Employee's
own choosing; provided that such schedule shall be
completed no later than three years from the date of
Employee's termination of employment.
(3) Employee and Employee's dependents shall continue to
be covered by, and receive employee welfare and
executive fringe benefits (including but not limited
to medical, dental, life, accident and disability
insurance available to officers of the Company and
additional executive retirement and other fringe
benefits approved by the President and CEO of the
Company) in accordance with the terms of the
Company's benefit plans and executive fringe benefit
programs, for three years following the date of
termination, and at no less than the levels Employee
and Employee's dependents were receiving immediately
prior to the Change in Control. Employee's dependents
shall be entitled to continued benefits coverage
pursuant to the preceding sentence for the balance of
such three year period in the event of Employee's
death during such period. The period during which
Employee and Employee's dependents are entitled to
continuation of group health plan coverage pursuant
to Section 4980B of the Internal Revenue Code of
1986, as amended, and Part 6 of Title I of the
Employee Retirement Income Security Act of 1974, as
amended, shall commence on the date next following
the expiration of the aforementioned three year
period.
(4) Employee shall receive an additional retirement
benefit, over and above that which Employee would
normally be entitled to under the Company's
retirement plans or programs applicable to Employee,
equal to the actuarial equivalent of the additional
amount that Employee would have earned under such
retirement plans or programs had Employee accumulated
three additional continuous years of service. Such
amount shall be paid to Employee in a cash lump sum
payment on the earlier to
6
<PAGE>
occur of Employee's termination of employment
following a Change in Control or Employee's
Retirement Date, together with a gross-up bonus in an
amount equal to any federal, state and local income
taxes and excise taxes (including FICA and any
similar taxes) payable by Employee on such lump sum
payment and such gross-up bonus.
(5) The Company, at its expense, shall provide Employee
with outplacement services of a nationally recognized
outplacement firm of the Employee's choosing until
the earlier of (a) the Employee's attainment of
employment, or (b) the date eighteen (18) months from
the date of Employee's termination of employment;
provided, however, that the cost of such outplacement
services shall not exceed 3.5% of the cash payment
due to Employee pursuant to subsection 7(a)(2) above.
(6) The amounts paid to Employee under this Change in
Control provision applicable to Employee shall be
considered severance pay in consideration of past
service Employee has rendered to the Company and in
consideration of Employee's continued service from
the date hereof to entitlement of those payments.
(b) In the event that a Change in Control occurs, whether or not
such Change in Control has the prior written approval of a
majority of the Continuing Directors (as defined in the AAR
CORP. Stock Benefit Plan), and notwithstanding any conditions
or restrictions related to any Award granted to Employee under
the Plan, all Options or Limited Rights, or both, granted to
Employee under the Plan will become immediately exercisable
and remain exercisable for the full remaining life of the
option whether or not Employee's employment continues, and all
restrictions on Restricted Stock granted to Employee under the
Plan will immediately lapse.
(c) For purposes of this Agreement
(i) "Change in Control" means the earliest of:
(1) any person (as such term is used in Section
13(d) of the Securities Exchange Act of
1934, as amended ("Exchange Act"), has
acquired (other than directly from the
Company) beneficial ownership (as that term
is defined in Rule 13d-3 under the Exchange
Act), of more than 20% of the outstanding
capital stock of the Company entitled to
vote for the election of directors; or
(2) the effective time of (i) a merger or
consolidation or other business combination
of the Company with one or more other
corporations as a result of which the
holders of the outstanding voting stock of
the Company immediately prior to such
business combination hold less than 60% of
the voting stock of the surviving or
resulting corporation, or (ii) a transfer of
substantially all of the assets of the
Company other than to an entity of which the
Company owns at least 80% of the voting
stock; or
7
<PAGE>
(3) the election over any period of time to the
Board of Directors of the Company without
the recommendation or approval of the
incumbent Board of Directors of the Company,
of the lesser of (i) three directors, or
(ii) directors constituting a majority of
the number of directors of the Company then
in office.
(ii) "Good Reason" means:
(1) a material reduction in the nature or scope
of Employee's duties, responsibilities,
authority, power or functions from those
enjoyed by Employee immediately prior to the
Change in Control, or a material reduction
in Employee's compensation (including
benefits), occurring at any time during the
two-year period immediately after the Change
in Control; or
(2) if the incumbent in the position of
President and CEO of the Company on August
8, 1997 is not the President and CEO of the
Company at the time of termination, a good
faith determination by Employee that as the
result of a Change in Control and a material
change in employment circumstances at any
time during the immediate two year period
after the Change in Control, Employee is
unable to carry out Employee's assigned
duties and responsibilities in a manner
consistent with the practices, standards,
values or philosophy of the Company
immediately prior to the Change in Control;
or
(3) a relocation of the primary place of
employment of at least 100 miles.
(iii) "Disability" means:
(1) a physical or mental condition which has
prevented Employee from substantially
performing Employee's assigned duties for a
period of 180 consecutive days and which is
expected to continue to render Employee
unable to substantially perform Employee's
duties on a full-time basis and otherwise
meets the benefit eligibility requirements
of the Company's Long Term Disability
Welfare Benefit Plan or any executive
program in which Employee was a participant
at the time of a Change in Control. The
Company will make reasonable accommodation
for any handicap of Employee as may be
required by applicable law.
In the event of termination by the Company for
Disability after a Change in Control, a good faith
determination of the existence of a Disability shall
be made by resolution of the Compensation Committee
of the Board of Directors of the Company, in its sole
discretion, setting forth the particulars of the
Disability which shall be final and binding upon the
Employee. The
8
<PAGE>
Company may require the submission of such medical
evidence as to the condition of the Employee as it
may deem necessary in order to arrive at its
determination of the occurrence of a Disability, and
Employee will cooperate in providing any such
information. Employee will be provided with
reasonable opportunity to present additional medical
evidence as to the medical condition of Employee for
consideration prior to the Board making its
determination of the occurrence of a Disability.
Upon termination of Employment by Company for
Disability after a Change in Control, Employee will
receive Disability payments pursuant to the Company's
short and long term Disability welfare benefit plans
then in effect according to the terms of such plans
and continue to be eligible to participate in the
Company's medical, dental and life insurance programs
then in effect and available to officers of the
Company in accordance with their terms for a period
of 3 years from the date of such termination of this
Agreement.
(iv) "Cause" means:
(1) Employee engages, during the performance of
Employee's duties hereunder, in acts or
omissions constituting dishonesty,
intentional breach of fiduciary obligation
or intentional wrongdoing or malfeasance;
(2) Employee intentionally disobeys or
disregards a lawful and proper direction of
the Board or the Company; or
(3) Employee materially breaches the Agreement
and such breach by its nature, is incapable
of being cured, or such breach remains
uncured for more than 10 days following
receipt by Employee of written notice from
the Company specifying the nature of the
breach and demanding the cure thereof. For
purposes of this clause (3), a material
breach of the Agreement that involves
inattention by Employee to Employee's duties
under the Agreement shall be deemed a breach
capable of cure.
Without limiting the generality of
the foregoing, the following shall not constitute
Cause for the termination of employment of Employee
or the modification or diminution of any of
Employee's authority hereunder:
(1) any personal or policy
disagreement between Employee and the
Company or any member of the Board; or
(2) any action taken by
Employee in connection with Employee's
duties hereunder, or any failure to act, if
Employee acted or failed to act in good
faith and in a manner Employee reasonably
believed to be in and not opposed to the
best interest of
9
<PAGE>
the Company and Employee had no reasonable
cause to believe Employee's conduct was
unlawful; or
(3) termination of
Employee's employment for overall
unsatisfactory performance (including, but
not limited to, failure to meet financial
goals).
Termination for Cause shall be limited to a good
faith finding by resolution of the Compensation
Committee of the Board,. setting forth the
particulars thereof. Any such action shall be taken
at a regular or specially called meeting of the
Compensation Committee of the Board, after a minimum
10 days notice thereof to Employee, with termination
of Employee's employment with the Company for Cause
listed as an agenda item. Employee will be given a
reasonable opportunity to be heard at such meeting
with counsel present if Employee desires. Any such
resolution shall be final and binding.
Upon termination of employment by Company for Cause,
no further compensation or benefits shall accrue or
be payable to Employee by the Company, except for any
compensation, bonus or other benefits which have
accrued to Employee prior to the date of any such
termination.
Nothing herein shall be construed to prevent the
Company from terminating Employee's employment at any
time for any reason or for no reason.
(d) The Company will pay reasonable legal/attorney's fees
(including court costs and other costs of litigation)
incurred by Employee in connection with enforcement
of any right or benefit under this Agreement.
(e) The Company shall promptly pay Employee a gross-up
bonus in an amount equal to (i) all excise taxes
payable under Section 280G of the Internal Revenue
Code on any amounts constituting "golden parachute"
payments, plus (ii) any federal, state, and local
income taxes and excise taxes (including FICA)
payable by Employee on such gross-up bonus in order
to put Employee in the same position Employee would
have been in if the excise tax provision (Section
280G) did not apply.
(f) The Company will continue to provide SKERP retirement
benefits to Employee and Employee's spouse at no less
than the level they are receiving or entitled to
receive under the SKERP as it was in effect
immediately prior to the Change in Control.
8. CHANGES IN BUSINESS. The Company, acting through its Board of
Directors, will at all times have complete control over the Company's
business and retirement and other employee health and welfare benefit
plans ("Plans"). Without limiting the generality of the foregoing, the
Company may at any time or times change or discontinue any or all of
its present or future operations or Plans (subject to their terms), may
close or move any one or more of its divisions or offices, may
undertake any new servicing or sales operation, may sell any one
10
<PAGE>
or more of its divisions or offices to any company not controlled,
directly or indirectly, by the Company or may take any and all other
steps which its Board of Directors, in its exclusive judgment, shall
deem desirable, and Employee shall have no claim or recourse against
the Company, its officers, directors or employees by reason of such
action except for enforcement of the provisions of Sections 5 and 7 of
this Agreement.
9. SEVERANCE PAYMENT AS SOLE OBLIGATION. Except as expressly provided in
Sections 5 and 7 above, no further compensation, payments, liabilities
or benefits shall accrue or be payable to Employee upon or as a result
of termination of Employee's employment for any reason whatsoever
except for any compensation, bonus or other benefits which accrued to
Employee prior to the date of employment termination.
The amounts paid to the Employee under Section 5 and 7 of this
Agreement shall be considered severance pay in consideration of past
services Employee has rendered to the Company and in consideration of
Employee's continued service from the date hereof to entitlement to
those payments.
10. NOTICES. Any notice or other instrument or thing required or permitted
to be given, served or delivered to any of the parties hereto shall be
delivered personally or deposited in the United States mail, with
proper postage prepaid, telegram, teletype, cable or facsimile
transmission to the addresses listed below:
(a) If to the Company, to:
AAR CORP.
1100 N. Wood Dale Road
Wood Dale, Illinois 60191
Attention: Chairman
With a copy to:
AAR CORP.
1100 N. Wood Dale Road
Wood Dale, Illinois 60191
Attention: General Counsel
(b) If to Employee, to:
Howard A. Pulsifer
630 Indian Way
Barrington, IL 60010
or to such other address as either party may from time to time
designate by notice to the other. Each notice shall be effective when
such notice and any required copy are delivered to the applicable
address.
11
<PAGE>
11. NON-ASSIGNMENT.
(a) The Company shall not assign this Agreement or any rights or
obligations hereunder without the prior written consent of
Employee, and any attempted unpermitted assignment shall be
null and void and without further effect; provided, however,
that, upon the sale or transfer of all or substantially all of
the assets of the Company, or upon the merger by the Company
into or the combination with another corporation or other
business entity, or upon the liquidation or dissolution of the
Company, this Agreement will inure to the benefit of and be
binding upon the person, firm or corporation purchasing such
assets, or the corporation surviving such merger or
consolidation, or the shareholder effecting such liquidation
or dissolution, as the case may be. After any such
transaction, the term Company in this Agreement shall refer to
the entity which conducts the business now conducted by the
Company. The provisions of this Agreement shall be binding
upon and inure to the benefit of the estate and beneficiaries
of Employee and upon and to the benefit of the permitted
successors and assigns of the parties hereto.
(b) The Employee agrees on behalf of Employee, Employee's heirs,
executors and administrators, and any other person or person
claiming any benefit under Employee by virtue of this
Agreement, that this Agreement and all rights, interests and
benefits hereunder shall not be assigned, transferred, pledged
or hypothecated in any way by the Employee or by any
beneficiary, heir, executor, administrator or other person
claiming under the Employee by virtue of this Agreement and
shall not be subject to execution, attachment or similar
process. Any attempted assigned, transfer, pledge or
hypothecation or any other disposition of this Agreement or of
such rights, interests and benefits contrary to the foregoing
provisions or the levy or any execution, attachment or similar
process thereon shall be null and void and without further
effect.
12. SEVERABILITY. If any term, clause or provision contained herein is
declared or held invalid by any court of competent jurisdiction, such
declaration or holding shall not affect the validity of any other term,
clause or provision herein contained.
13. CONSTRUCTION. Careful scrutiny has been given to this Agreement by the
Company, Employee, and their respective legal counsel. Accordingly, the
rule of construction that the ambiguities of the contract shall be
resolved against the party which caused the contract to be drafted
shall have no application in the construction or interpretation of this
Agreement or any clause or provision hereof.
14. ENTIRE AGREEMENT. This Agreement as amended and restated herein and the
other agreements referred to herein set forth the entire understanding
of the parties and supersede all prior agreements, arrangements and
communications, whether oral or written, pertaining to the subject
matter hereof.
15. WAIVER. No provision of this Agreement may be amended, modified, waived
or discharged unless such amendment, modification, waiver or discharge
is agreed to in writing signed by Employee and an authorized officer of
the Company. No waiver by either party hereto at any time of any breach
by the other party hereto of, or compliance with, any condition or
12
<PAGE>
provision 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.
16. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois without regard to its
conflicts of law principles.
17. EXECUTION. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original and which shall constitute
but one and the same Agreement.
WITNESS the due execution of this Agreement by the parties hereto as of the day
and year first above written.
Employer:
AAR CORP.
/s/ David P. Storch
-----------------------------------
By:
Title: President
Employee:
/s/ Howard A. Pulsifer
-----------------------------------
Howard A. Pulsifer
13
