R E C I T A L S

THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of May 8, 2019 (the "Effective Date"), by and between MICHAEL MAGNUSSON (the "Executive"), JETFLEET MANAGEMENT CORP., (the "JMC") and AEROCENTURY CORP. (“ACY” or the “Company”). ACY, JMC and Executive may be referred to together as the "Parties." 

A. Executive and JMC entered into an employment agreement dated September 1, 2016 (the “JMC Employment Agreement”) which provided for Executive’s employment as Managing Director of JMC for a three-year term expiring on August 31, 2019.  As part of Executive’s duties, Mr. Magnusson was to act as President of ACY, which, at the time, was managed by JMC pursuant to a management contract.  At all times during the JMC Employment Agreement, Executive was compensated solely by JMC and not ACY.

B.  On October 1, 2018, ACY acquired JetFleet Holding Corp., the parent corporation of JMC.

C. Executive, JMC, and ACY desire that effective as of the Effective Date, the JMC Employment Agreement be terminated and replaced by this Agreement, and that ACY employ Executive directly, and direct JMC to make the payroll payments set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

For ease of reference, this Agreement is divided into the following parts, which begin on the pages indicated:

FIRST PART:  TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND BENEFITS DURING EMPLOYMENT (Sections 1-5, beginning on page 2)

SECOND PART:  COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE TERMINATION (Section 6, beginning on page 7)

THIRD PART:  SUCCESSORS, ARBITRATION, EXECUTIVE REPRESENTATIONS, MISCELLANEOUS PROVISIONS, CODE SECTION 409A, SIGNATURE PAGE (Sections 7-10, beginning on page 7)

For purposes of paragraph 1(f) of this Agreement, except as otherwise specified herein, "Change in Control" means:  the consummation of: (1) a liquidation or dissolution of the Company, (2) an agreement for the sale or disposition of or all or substantially all of ACY’s assets, (3) a reorganization, merger or consolidation of ACY with any other corporation, or (4) a similar transaction or series of transactions involving ACY, however, if after any of the transactions discussed in (1) through (4) of this Section 1(f) the Company's shareholders immediately before the transaction continue to own at least a majority of the voting securities of the new (or continued) entity immediately after the transaction, then (1) through (4) of this Section 1(f) will not be considered a Change in Control. 

 

To Executive:

Michael Magnusson

San Mateo, CA 94401

To ACY or JMC:

Chairman of the Board of Directors

AeroCentury Corp.

1440 Chapin Avenue #310,

Burlingame, CA 94010

Any notice under this Agreement shall be deemed to have been received when personally delivered or  three (3) days after it is sent via email or deposited in the U.S. mail, as specified above.  Either party may change its address for notices by giving notice to the other party in the manner specified in this Section.

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.  Executive represents that he has consulted (or has had the opportunity to consult) with his own counsel prior to execution of this Agreement.

________________________________

________________________________

By:  Toni M. Perazzo, Sr. Vice President - Finance

_______________________________

By: Michael G. Magnusson, Managing Director

("Executive") in consideration of his employment by AeroCentury Corp. (“ACY”) represents and agrees with ACY as follows:

1. Executive understands that the ACY is engaged in a continuing business of aircraft leasing businesses. Executive further understands that in his position with ACY he will have access to and, in some cases, develop or derive confidential and proprietary information of ACY, its clients and business associates.

2. Executive understands and acknowledges that his employment by ACY creates a fiduciary relationship of confidence and trust with respect to all proprietary business information of a confidential nature that may be disclosed to him or developed or derived by him which relates to the business of ACY, its customers and its business associates. Such proprietary, confidential business information is the property of the Company, its clients and/or its business associates and includes but is not limited to product, research and investment plans, inventions, formulas, processes, technology, designs, business strategies, financial information, marketing and advertising materials, sales and profit figures, other Executives' personnel information, customer or client identifying information (including but not limited to customer lists),   particular customer or client requirements, business forecasts, and other technical and business information, except as may be required by law.

3. At all times, both during his employment and after its termination, Executive agrees to keep and hold all proprietary, confidential business information in strict confidence and trust, and agrees not to use or disclose any such proprietary, confidential business information without the prior written consent of ACY, except as may be required to perform his work for ACY or required by law. Upon termination of his employment with ACY, for whatever reason, Executive agrees to promptly deliver to ACY all documents and materials of whatever nature belonging to ACY which pertain to his work at ACY and agrees further that he will not take with him any documents or materials or copies thereof containing any proprietary, confidential business information.

4.    Executive acknowledges that in the event of breach or threatened breach of this Confidentiality Agreement by him, ACY may suffer irreparable harm and will therefore be entitled to injunctive relief to enforce this Agreement, and in the event ACY prevails in any proceeding in connection therewith, Executive agrees to pay to ACY all costs and expenses including reasonable attorney's fees incurred in connection therewith.

This Separation Agreement and Release of All Claims ("Separation Agreement") is made and entered into by and between MICHAEL MAGNUSSON, an individual residing at 2 Clark Drive, Apt. 305, San Mateo CA 94401.  ("Executive") and AEROCENTURY CORP. a corporation with its principal place of business at 1440 Chapin Avenue, Suite 310, Burlingame, CA 94010  ("Employer" or "Company") to establish the terms and conditions of Executive's separation from Employer.  Executive and Employer hereby agree as follows:

1.  Separation Date.  Executive's employment with the Company will cease on [  ] ("Separation Date").  Executive hereby resigns, effective as of the Separation Date, as an Executive of the Company.

2.  Compensation.  Executive has been paid all salary, accrued vacation, and other benefits due to Executive through the Separation Date.  The Company will reimburse Executive for his final expenses in the amount of [  ] within five (5) business days of the receipt of this signed Separation Agreement.

3.  Separation Payment.  Employer agrees to pay Executive on a semi-monthly basis Executive's Base Salary in effect on the Separation Date, [specify amount] for the period of time from the Separation Date until December 31, 2021, which is the end of the term  specified in Executive's Agreement to which this Separation Agreement is attached.  Accordingly, Employer will pay [specify how many months between separation and such end of term] base salary, [specify amount to be paid twice a month based on Base Salary in effect at time of separation] per month, totaling the gross sum of $ [    ], reduced by all legally required and previously authorized deductions and withholdings  ("Separation Pay").  The Company's obligation to provide Executive with the Severance Pay shall be suspended until the expiration of the seven-day revocation period described in section 17(g).

4.  Health Insurance.  Executive acknowledges that his eligibility to participate in Employer's current group health insurance policy will cease on the last day of the calendar month in with the Separation Date occurs.  Any employer contributions to Executive's group health insurance will cease as of the Separation Date.  Executive understands that after such date, he may have rights under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA") that allow him to continue participating in Employer's health plan. Executive acknowledges that nothing in this section 4 shall prohibit Employer from changing, withdrawing, or in any way modifying its group health plans, and nothing herein shall be construed as a guarantee of payment of any particular claim submitted by Executive to such plans.

5. Sole Consideration.  It is understood and agreed that the Separation Pay constitute(s) the sole consideration for and settlement in full of any and all potential claims by Executive against Employer and that Executive would not be entitled to receive any portion of the sums set forth in section 3 above absent this Separation Agreement.

6.  Executive’s Release.  The parties understand and agree that this Separation Agreement resolves and settles all obligations and differences between Employer and its past and present owners, partners, investors, officers, directors, stockholders, affiliates, predecessors, successors, assigns, agents, employees, representatives and attorneys (the "Released Parties") on the one hand, and Executive, and for each of Executive's past and present agents, assigns, transferees, heirs, spouses, relatives, executors, attorneys, administrators, employees, predecessors, affiliates, successors, insurers, and representatives ("Releasors") on the other hand, arising out of Executive's employment with Employer and the cessation of that employment.  This is a compromise settlement of all claims and therefore does not constitute an admission of liability on the part of the Releasees or Executive, or an admission, directly or by implication, that the Releasees or Executive have individually or collectively violated any law, rule, regulation, contractual right or any other duty or obligation.   Releasors irrevocably and unconditionally waive, release and forever discharge, the Releasees from all claims for relief, causes of action and liabilities, known or unknown, that Releasors have or may have against any of the Releasees individually and/or collectively, arising out of, relating to, or resulting from, any events occurring prior to the execution of this Separation Agreement including, but not limited to, any claims for relief, causes of action and liabilities arising out of, relating to, or resulting from, Executive's employment with Employer or the cessation of that employment.  Nothing contained herein or elsewhere in this Separation Agreement shall constitute any release or waiver by Executive of any rights to seek specific performance of any provision of this Separation Agreement or to bring any action or claim based on any breach of any covenant contained in this Separation Agreement.

7.  Executive's Waiver of Potential and Actual Claims.  It is understood and agreed that the total amount specified in paragraph 3 above, constitutes the sole consideration for and settlement in full of any and all claims by Executive against the Released Parties, including claims for costs and attorneys' fees.  It is expressly understood by Executive that among the various rights and claims being waived in this release are all claims for breach of any implied or express contract or covenant; claims for promissory estoppel; claims of entitlement to any pay (other than the consideration promised in paragraph 3); claims of wrongful denial of insurance and employee benefits, including, but not limited to claims for benefits or monies under Employer's benefit plans or any other plan; claims for wrongful termination, public policy violations, defamation, invasion of privacy, fraud, misrepresentation, emotional distress or other common law or tort causes of action; claims of harassment, retaliation or discrimination under federal, state, or local law; claims based on any federal, state or other governmental statute, regulation or ordinance, including, without limitation, Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1866, the Civil Rights Act of 1871, the Civil Rights Act of 1991, the Americans with Disabilities Act, the Family and Medical Leave Act, the National Labor Relations Act, the Older Worker's Benefit Protection Act, the Employee Retirement Income Security Act, the Age Discrimination in Employment Act of 1967, 29 U.S.C.  § 621, et seq., the California Fair Employment and Housing Act, the California Family Rights Act, the California Constitution, and/or the California Labor Code, including wage and hour issues and claims arising under Labor Code Section 132a.  This release does not affect vested retirement benefits, benefits to which Executive is entitled under COBRA, any claims for workers’ compensation benefits, or any other claims that cannot be released or waived as a matter of law. This includes the right to file a charge with any administrative agency (such as the U.S. Equal Employment Opportunity Commission or state fair employment practices agency), provide information to an agency, or otherwise participate in an agency investigation or other administrative proceeding. however, Executive does waive and release Executive's right to any monetary recovery or other personal relief should the EEOC or any other agency pursue claims on Executive's behalf.  This release also does not apply to any claim brought to challenge the validity of this Separation Agreement under the ADEA, to enforce the terms of this Separation Agreement, or for claims that arise under the ADEA after the Separation Agreement becomes effective pursuant to section 17(g).  The parties acknowledge that Executive may be required to respond to subpoena(s) to the extent required by law and Executive agrees that Executive will give prompt written notice to Employer at such time that such involvement is requested of Executive.

8.  Waiver Under CCP § 1542.  Executive waives all rights under § 1542 of the California Civil Code, which section has been fully read and understood by Executive or explained to him by his counsel.  Section 1542 provides as follows:

9.  Confidential Information Obligation.  Executive agrees that he will keep confidential all matters, documents and information disclosed to him by the Employer or to which he has or had access and will not at any time disclose such materials and information to third parties or use or attempt to use any such materials and information in any manner which may injure or cause loss or may be calculated to injure or cause loss, whether directly or indirectly, to the Employer.  By the Separation Date, Executive shall return to Employer, and will not retain any copies of, all documents, information and other property of Employer or Employer's customers or partners in his possession or control, including, but not limited to: files, notes, memoranda, correspondence, agreements, draft documents, notebooks, logs, drawings, records, plans, proposals, reports, forecasts, financial information, specifications, computer-recorded information, tangible property and equipment, credit cards, entry cards, identification badges and keys, and any materials of any kind that contain or embody any proprietary or confidential information of Employer or Employer's customers or partners (and all reproductions thereof in whole or in part).  Executive agrees to make a diligent search for any documents, information and property (as described above) in his possession or control prior to the Separation Date.  Nothing in this Separation Agreement shall prohibit Executive from publicly disclosing that he worked for the Company and to publicly disclose the work he performed, services he provided and accomplishments he achieved while working for the Company.

10.  Nondisparagement.  The parties agree that they will not, at any time now or in the future, disparage or discredit the other or any of Employer's directors, officers and employees in any communication.

11.  References and Employment Verification.  Executive agrees that he will direct all requests for verification of his employment with Employer to Toni Perazzo at Employer.  Employer agrees that it will instruct Toni Perazzo and any successor to the position Perazzo currently holds, to respond to inquiries regarding Executive's employment with Employer by giving the dates of Executive's employment with Employer and the last position held by Executive.  If Employer is required by law to provide other or different information regarding Executive's employment with Employer, nothing in this Separation Agreement will require Employer to violate that legal requirement.  In the event Executive directs any request for information regarding his employment with Employer to anyone other than Toni Perazzo or his successor, Employer will not be legally responsible for any responses to said information request(s).

13.  Arbitration.  It is understood and agreed that if, at any time, a violation of any term of this Separation Agreement is asserted by any party hereto or any dispute arises hereunder or related hereto, the parties shall submit such dispute to binding arbitration before a sole arbitrator in the San Francisco Bay Area, California.  Such arbitration shall be governed by the American Arbitration Association's National Rules for the Resolution of Employment Disputes, which can be viewed at www.adr.org/aaa/faces/rules.  The prevailing party shall be entitled to recover its reasonable costs and attorneys' fees.  The parties agree that judgment upon any such award may be ordered in a court properly having jurisdiction over such claims.

14.  Governing Law.  This Separation Agreement shall be interpreted, enforced and governed by the laws of the State of California without reference to conflicts of laws principles.

15.  Waiver of Age Claims under the Age Discrimination in Employment Act (ADEA).  Executive fully understands, acknowledges and agrees that he:

15. Informed and Voluntary Execution of Separation Agreement.  Executive acknowledges and agrees that (i) he has been advised that this Separation Agreement is a final and binding legal document, (ii) he has had reasonable and sufficient opportunity to consult with an independent legal representative of his own choosing before signing this Separation Agreement, (iii) he has either (A) so consulted with such an independent legal representative of his own choosing or (B) freely, independently and voluntarily declined to do so, and (iv) in signing this Separation Agreement he has acted voluntarily of his own free will and has not relied upon any representation made by the Employer regarding this Separation Agreement's subject matter or its effect.

16.  No Assignment of Claims. Executive represents and warrants that he has not transferred or assigned to any person or entity any rights, claims and/or causes of action released herein.

17.  Successors. It is understood and agreed that this Separation Agreement shall be binding upon and inure to the benefit of the parties hereto and their heirs, administrators, representatives, including, but not limited to, attorneys, executors, successors, and assigns.

18.  Severability. The parties agree that if any provision of this Separation Agreement is declared or determined by any court of competent jurisdiction to be illegal, invalid, or unenforceable, the legality, validity, and enforceability of the remaining parts, terms, or provisions shall not be affected thereby, and said illegal, unenforceable or invalid part, term, or provision shall be deemed not to be part of this Separation Agreement.

20.  Entire Separation Agreement.Except as specifically stated herein, this Separation Agreement sets forth the entire Separation Agreement between the parties relating to the rights herein and the obligations herein assumed, and supersedes any and all previous negotiations, separation agreements and/or understandings of any kind relating to the subject matter hereof.  Any oral representations or modifications concerning this Separation Agreement shall be of no force or effect.  This Separation Agreement can be modified only in the form of a writing signed by both parties hereto.

HAVING READ the foregoing, consisting of this and _____ other typewritten pages, the parties hereby voluntarily sign below and execute this Separation Agreement.