ARAMARK Corp. Contracts

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Employment Agreement - ARAMARK Corp. and William Leonard

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EMPLOYMENT AGREEMENT

AGREEMENT, made and entered into this 27th day of October, 2003, by and between ARAMARK Corporation, a Delaware corporation (“ARAMARK”), and William Leonard (“Mr. Leonard”) (the “Agreement”).

W I T N E S S E T H:

WHEREAS, Mr. Leonard currently serves as President and Chief Operating Officer of ARAMARK; and

WHEREAS, ARAMARK and Mr. Leonard desire to enter into this Agreement, effective January 1, 2004, which will set forth the terms and conditions under which Mr. Leonard will serve in an executive capacity hereafter for ARAMARK and is affiliates;

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto hereby agree as follows:

1. Employment. ARAMARK hereby employs Mr. Leonard, and Mr. Leonard hereby accepts such employment, as of January 1, 2004, upon the terms and conditions set forth in this Agreement.

2. Position and Duties. During the Term (as hereinafter defined), Mr. Leonard (i) agrees to serve as the President and Chief Executive Officer of ARAMARK and to perform such duties in such capacity as may be delineated in the By-Laws of ARAMARK and such other reasonable duties, consistent with his position as President and Chief Executive Officer, as may be assigned to him from time to time by the Board of Directors of ARAMARK (the “Board”), (ii) shall report only to the Board, and (iii) shall be given such authority as is appropriate to carry out the duties described above. During the Term, ARAMARK shall make its best efforts to ensure Mr. Leonard’s election to, and retention as a member of, the Board.

3. Exclusive Services. During the Term, and except for illness or incapacity, Mr. Leonard shall devote substantially all of his business time, attention, skill and efforts exclusively to the business and affairs of ARAMARK and its subsidiaries and affiliates, shall not be engaged in any other business activity, and shall perform and discharge the duties that may be assigned to him from time to time by the Board; provided, however, that nothing in this Agreement shall preclude Mr. Leonard from devoting time during reasonable periods required for:

(i) serving, in accordance with ARAMARK’s policies and with the prior approval of the Board, as a director or member of a committee of any company or organization,

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(it being understood that Mr. Leonard may continue to serve as a director or member of boards and committees on which he serves as of the date of this Agreement);

(ii) delivering lectures and fulfilling speaking engagements;

(iii) engaging in charitable and community activities; and

(iv) investing his personal assets in a Passive Investment (as hereinafter defined) in such form and in such manner as will not violate Section 11 below.

For purposes of this Agreement, a “Passive Investment” shall mean an investment in a business or entity which does not require Mr. Leonard to render any services in the operations or affairs of such business or entity and which does not materially interfere with the performance of Mr. Leonard’s duties and obligations to ARAMARK or any of its subsidiaries or affiliates.

4. Relocation. ARAMARK shall not relocate Mr. Leonard’s principal place of business outside of Philadelphia, Pennsylvania, without the written consent of Mr. Leonard.

5. Term of Agreement. The term of this Agreement shall be the period commencing on January 1, 2004 and ending on December 31, 2006 unless earlier terminated pursuant to Section 9; provided, however, that commencing with January 1, 2007 and on each January 1 thereafter (each, an “Extension Date”) the term shall be automatically extended for an additional one-year period, unless ARAMARK or Mr. Leonard provides the other party hereto one-year prior written notice before the next Extension Date that the term shall not be so extended. (The term of this Agreement, as so extended, if applicable, pursuant to this Section 5, and subject to termination pursuant to Section 9, shall be referred to herein as the “Term”).

6. Salary and Annual Bonus.

(a) Salary. Mr. Leonard shall be paid base salary (the “Base Salary”) at the initial rate of $1,000,000 per annum. The Base Salary shall be payable in accordance with the customary payroll practices for senior executives of ARAMARK. The Board shall review the performance of Mr. Leonard on a periodic basis and, in its sole discretion, may (but is not required to) increase his salary payable hereunder. Any such increased salary shall thereafter be Mr. Leonard’s Base Salary.

(b) Annual Bonus. Mr. Leonard shall be a participant in the Senior Executive Annual Performance Bonus Arrangement or any successor plan, in accordance with and subject to the terms and conditions of such arrangement or as it may hereafter be amended (the amount payable thereunder, his “Bonus”). His annual target bonus under such plan (the “Target Bonus”) shall be $1,000,000, which may be increased from time to time by the Board or a committee thereof.

7. Stock Options; Stock Ownership; Other Equity Programs.

(a) Mr. Leonard shall be eligible to participate in ARAMARK’s 2001 Equity Incentive Plan, or any successor plans, in accordance with and subject to the terms and conditions of such plans or as they may hereafter be amended, so long as they remain in effect.

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As of January 1, 2004, Mr. Leonard shall be granted an option to purchase 370,000 shares of ARAMARK Class A common stock, subject to approval by the Stock Committee of the Board.

8. Retirement and Welfare Benefits.

(a) During the Term, unless otherwise specified herein, Mr. Leonard will be eligible to participate in all retirement and welfare plans, programs and benefits that are from time to time applicable to senior executives of ARAMARK at benefit levels applicable to such senior executives (including, without limitation, each retirement plan, supplemental and excess retirement plan, group life insurance, accident and death insurance, medical and dental insurance, sick leave and disability plan and any other plan or program providing fringe benefits or perquisites).

(b) ARAMARK shall pay Supplemental Retirement Benefits under the terms and conditions set forth in Exhibit A.

9. Termination of Employment.

(a) Termination for Cause; Resignation Without Good Reason.

(i) ARAMARK may terminate Mr. Leonard’s employment hereunder for Cause in accordance with the provisions of Section 9(a)(ii), and the Term shall end on the date of any such termination. Mr. Leonard may voluntarily terminate his employment hereunder without Good Reason. In such event, the Term will end on the date of any such termination. In the event Mr. Leonard’s employment is terminated by ARAMARK for Cause or Mr. Leonard resigns from his employment without Good Reason, Mr. Leonard shall receive the following amounts:

(A) Any Base Salary accrued but unpaid, and any accrued vacation as of the effective date of termination (the “Accrued Amounts”);

(B) A prorated Target Bonus with respect to ARAMARK’s fiscal year in which termination occurs equal to the Target Bonus multiplied by the number of days employed over total days in the year in which Mr. Leonard’s employment terminated (a “Pro-Rata Bonus”);

(C) Supplemental Retirement Benefits payable pursuant to Exhibit A;

(D) All amounts otherwise payable or coverages otherwise afforded pursuant to the terms of any employee benefit plan maintained by ARAMARK (the “Plan Amounts”); and

(E) Mr. Leonard may elect to continue at his sole expense the Executive Health Plan (to the extent Mr. Leonard and members of his family are eligible for such benefit and, for this purpose, Mr. Leonard shall be deemed to be employed by ARAMARK) for a period not to exceed three years.

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In addition, all of the options and Installment Stock Purchase Opportunities (“ISPOs”) held by Mr. Leonard shall remain subject to the terms and conditions of the applicable plans.

(ii) Termination for “Cause” shall mean termination by action of the Board because of: (A) Mr. Leonard’s repeated and willful failure to perform his duties hereunder in any material respect; (B) a felony conviction of Mr. Leonard; or (C) any willful misconduct by Mr. Leonard that is materially injurious to the financial condition or business reputation of ARAMARK and its affiliates and subsidiaries taken as a whole, provided, however, that no event or circumstance shall be considered to constitute Cause within the meaning of clause (A) or (C) unless Mr. Leonard has been given written notice of the events or circumstances constituting Cause and has failed to effect a cure thereof within 30 calendar days after his receipt of such notice.

(iii) Resignation for “Good Reason” shall mean the resignation of Mr. Leonard after (x) ARAMARK, without the express written consent of Mr. Leonard, materially breaches this Agreement or Mr. Leonard is not serving on the Board (other than with the express written consent of Mr. Leonard); (y) Mr. Leonard notifies ARAMARK in writing of the nature of such material breach or failure to be a member of the Board and (z) ARAMARK does not correct such material breach or failure within 30 calendar days after its receipt of such notice. ARAMARK acknowledges and agrees that a material breach for purposes of this Section 9 shall include, but not be limited to, any material reduction in Mr. Leonard’s duties or authority (whether or not accompanied by a change in title), any diminution in Mr. Leonard’s title, any failure to pay Mr. Leonard’s Base Salary and any relocation of Mr. Leonard’s principal place of business outside of Philadelphia, Pennsylvania.

(b) Termination Without Cause; Resignation for Good Reason.

ARAMARK may terminate Mr. Leonard’s employment hereunder without Cause, in which case the Term will end on the date of any such termination. Mr. Leonard may terminate his employment hereunder for Good Reason, and the Term shall end upon such termination of employment.

In the event Mr. Leonard’s employment is terminated by ARAMARK without Cause or if Mr. Leonard should resign for Good Reason, Mr. Leonard shall receive the following amounts, and ARAMARK shall have no further obligation to Mr. Leonard under this Agreement, except as specifically set forth in this Agreement:

(i) The Accrued Amounts;

(ii) The Pro-Rata Bonus;

(iii) A lump sum payment equal to two times Mr. Leonard’s Base Salary, payable within 10 business days after the effective date of termination of employment;

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(iv) A lump sum payment equal to two times Mr. Leonard’s Target Bonus payable within 10 business days after the effective date of termination of employment;

(v) Supplemental Retirement Benefits shall be payable pursuant to Exhibit A;

(vi) Health and welfare plan participation shall continue for three years from the effective date of termination, as if Mr. Leonard had remained an active employee.

(vii) Mr. Leonard may elect to continue at ARAMARK’s expense the Executive Health Plan (to the extent Mr. Leonard and members of his family are eligible for such benefit and, for this purpose, Mr. Leonard shall be deemed to be employed by ARAMARK) for a period not to exceed three years; and

(viii) The Plan Amounts.

In addition, all of the options and ISPOs to purchase shares of Stock of ARAMARK held by Mr. Leonard shall become vested and immediately exercisable but will in all respects otherwise remain subject to the terms and conditions of the applicable plans.

(c) No Duty to Mitigate. Anything contained herein to the contrary notwithstanding, if Mr. Leonard’s employment terminates for any reason, Mr. Leonard shall in no event be required to seek any other employment or take any other action by way of mitigation or otherwise with respect to the amounts payable to Mr. Leonard under this Agreement. In addition, any amounts earned by Mr. Leonard, whether from self-employment, as a common law employee or otherwise, shall not reduce any amounts otherwise payable to him under this Agreement.

(d) Death. If Mr. Leonard’s Employment terminates by reason of Mr. Leonard’s death, the Term shall end and Mr. Leonard’s estate shall receive the following amounts:

(i) The Accrued Amounts;

(ii) The Pro-Rata Bonus;

(iii) Supplemental Retirement Benefits shall be payable to the extent set forth in Exhibit A;

(iv) The Plan Amounts; and

(v) The benefits described in Section 9(b)(vi) and (vii), applicable to Mr. Leonard’s spouse and dependents.

Stock options and ISPOs shall be treated in accordance with the terms of the applicable plans.

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(e) Permanent Disability. In the event that Mr. Leonard is unable to perform his duties hereunder by reason of illness or incapacity for a continuous period of more than six (6) months, or for an aggregate of more than eight (8) months in any twelve (12) month period, ARAMARK shall have the right to terminate Mr. Leonard’s employment by reason of disability (“Permanent Disability”). If ARAMARK terminates Mr. Leonard’s employment pursuant to this Section 9(e), the Term shall end and Mr. Leonard shall receive the following amounts:

(i) The Accrued Amounts;

(ii) Base Salary shall continue for a period of three years from the effective date of termination, offset by any payments due to Mr. Leonard pursuant to the Survivor Income Protection Plan and all other disability income protection plans of ARAMARK;

(iii) The Pro-Rata Bonus;

(iv) Supplemental Retirement Benefits shall be payable pursuant to Exhibit A;

(v) The Plan Amounts;

(vi) The benefits described in Section 9(b)(vi) and (vii).

In addition, all of the stock options and ISPOs held by Mr. Leonard shall become vested and immediately exercisable but will in all respects otherwise remain subject to the terms and conditions of the applicable plans.

(f) Non-Renewal of the Term by ARAMARK. In the event Mr. Leonard terminates his employment with ARAMARK upon termination of the Term solely by reason of an election by ARAMARK to not renew the Term pursuant to Section 5, the Term shall end in accordance with Section 5, and Mr. Leonard shall thereafter receive the amounts set forth in Section 9(b) above, as though Mr. Leonard’s employment had been terminated by him for Good Reason.

10. Trade Secrets. ARAMARK may, pursuant to Mr. Leonard’s employment hereunder, provide and confide to Mr. Leonard business methods and systems (“Systems”), techniques and methods of operation developed at great expense by ARAMARK and which Mr. Leonard recognizes to be unique assets of ARAMARK’s business. Mr. Leonard shall not, ever, during or after the Term, directly or indirectly, in any manner utilize or disclose to any person, firm, corporation, association or other entity, except to directors, consultants, lawyers, auditors, advisors, agents or employees of ARAMARK in the course of his duties or where required by law: (i) any such Systems, techniques and methods of operation, or (ii) any sales prospects, customer lists, products, research or data of any kind, or (iii) any information relating to strategic plans, sales costs, profits or the financial condition of ARAMARK or any of its customers or prospective customers, which are not generally known to the public or recognized as standard practice in the industries in which ARAMARK shall be engaged.

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11. Non-Competition Agreement.

(a) Subject to the geographic limitation of Section 11(b), Mr. Leonard, for a period commencing on the date hereof and ending two (2) years following the end of the Term shall not, without ARAMARK’s written permission, directly or indirectly, on his behalf or on behalf of any other person, firm, corporation, association or other entity, engage in, or in any way be concerned with or negotiate for, or acquire or maintain any ownership interest in any business or activity which is the same, similar to or competitive with that conducted by, engaged in or developed for later implementation by ARAMARK at any time during the Term of this Agreement; provided that the provision of this Section 11 shall not be deemed breached merely because Mr. Leonard owns not more than 1% of the outstanding stock of a corporation, if, at the time of its acquisition by Mr. Leonard, such stock is listed on a national securities exchange or quoted on an inter-dealer quotation system and provided further that Mr. Leonard shall not be required to cease any activity that did not violate this Agreement (or any predecessor agreement) when such activity commenced.

(b) Mr. Leonard acknowledges that ARAMARK is engaged in business in each of the 50 states and several foreign countries and that ARAMARK intends to expand the geographic scope of its activities. Accordingly and in view of the nature of his position and responsibilities, Mr. Leonard agrees that the provisions of Section 11(a) shall be applicable to all 50 states and, addition, to each foreign country, possession or territory in which ARAMARK may be engaged in business from time to time during the Term and as of the expiration of the Term.

(c) Mr. Leonard agrees that for a period of two (2) years following the end of the Term he will not, directly or indirectly, at any time in any manner, induce or attempt to influence any employees of ARAMARK to terminate their employment with ARAMARK.

(d) As used in Sections 10 and 11 of this Agreement, “ARAMARK” shall be deemed to include any entity twenty percent (20%) of the equity of which during the period for which he is receiving payments under this Agreement is directly or indirectly owned by ARAMARK.

12. Equitable Remedies. Mr. Leonard acknowledges that, in the event of any violation by Mr. Leonard of the provisions of Sections 10 or 11 of this Agreement, ARAMARK will sustain serious, irreparable and substantial harm to its business, the extent of which will be difficult to determine and impossible to remedy by an action at law for money damages. Accordingly, Mr. Leonard agrees that, in the event of such violation or threatened violation by Mr. Leonard, ARAMARK shall be entitled to an injunction before trial from any court of competent jurisdiction as a matter of course and upon the posting of not more than a nominal bond in addition to all such other legal and equitable remedies as may be available to ARAMARK. Mr. Leonard further agrees that, in the event any of the provisions of Sections 10 and 11 of this Agreement are determined by a court of competent jurisdiction to be contrary to any applicable statute, law or rule, or for any reason to be unenforceable as written, such court may modify any of such provisions so as to permit enforcement thereof as thus modified.

13. Additional Provisions. The provisions of Exhibit B are part of this Agreement.

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14. Substitution of Benefits. If any of the items of compensation, bonus or perquisites provided for in this Agreement shall hereafter be prohibited by governmental regulations, corporate law, ARAMARK policies or ARAMARK plans, payment or benefit of equivalent value shall be substituted by ARAMARK.

15. Entire Agreement. This Agreement (with the exhibits hereto and agreements referred to in Section 7), on and after January 1, 2004, shall constitute the full and complete understanding and agreement of Mr. Leonard and ARAMARK respecting the subject matter hereof, and supersedes all prior understandings and agreements, oral or written, express or implied, including without limitation the existing Agreement Relating to Employment and Post-Employment Competition between Mr. Leonard and ARAMARK (and all Exhibits thereto). This Agreement may not be modified or amended orally, but only by agreement in writing, signed by the party against whom enforcement of any waiver, change, modification, extension or discharge is sought.

16. Notices. All notices and other communications hereunder will be in writing and will be given by hand delivery to the other party or by next-day delivery service or registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to Mr. Leonard:

210 West Rittenhouse Square

Philadelphia, PA 19103

If to ARAMARK:

ARAMARK Corporation

1101 Market Street

Philadelphia, PA 19107

Attn.: Corporate Secretary

or to such other address as either party will have furnished to the other in writing. All notices and communications shall be deemed to have been duly given and received: (a) on the date of receipt, if delivered by hand; (b) three (3) business days after being sent by first class certified mail, return receipt requested, postage prepaid; or (c) one (1) business day after sending by next-day delivery service with confirmation of receipt. As used herein, the term “business day” means any day that is not Saturday, Sunday or legal holiday in the State of Pennsylvania.

17. Waiver of Breach. No waiver by either party of any condition or of the breach by the other of any term or covenant contained in this Agreement, whether by conduct or otherwise, in any one or more instances shall be deemed or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition, or of the breach of any other term or covenant set forth in this Agreement. Moreover, the failure of either party to exercise any right hereunder shall not bar the later exercise thereof.

18. Assignment. This Agreement shall inure to the benefit of and be binding on the parties and their respective successors in interest, and shall not be assignable by either party without the written consent of the other. ARAMARK will require any successor in interest

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to all or substantially all of ARAMARK (whether direct or indirect, by purchase, merger, or consolidation or otherwise) to expressly assume this Agreement, but ARAMARK shall remain liable if such successor in interest shall default on any of its obligations hereunder.

19. Governing Law. This Agreement is entered into and shall be construed in accordance with the laws of the Commonwealth of Pennsylvania.

20. Continuation of Covenants. The covenants and agreements of Mr. Leonard set forth in Sections 10 through 12 shall survive termination of employment, shall continue thereafter, and shall not expire unless and except as may be expressly set forth in said Sections.

21. Invalidity or Unenforceability. If any term or provision of this Agreement is held to be invalid or unenforceable, for any reason, such invalidity or unenforceability shall not affect any other term or provision hereof and this Agreement shall continue in full force and effect as if such invalid or unenforceable term or provision (to the extent of the invalidity or unenforceability) had not been contained herein.

22. Arbitration. Except as provided in Section 12, any controversy or claim arising out of or relating to this Agreement, or the breach hereof, shall be settled by arbitration in Philadelphia, Pennsylvania, before one arbitrator in accordance with rules then in effect of the American Arbitration Association. ARAMARK shall pay Mr. Leonard’s legal expenses should Mr. Leonard prevail on any substantial issue.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written.

		MR. LEONARD
		/S/    WILLIAM LEONARD
		William Leonard
		ARAMARK Corporation
		By:    /S/    JAMES E. PRESTON