XXXXXX X. XXXXXXXXX
RETENTION BONUS AGREEMENT
THIS RETENTION BONUS AGREEMENT (this "Agreement") is made as of this 4th
day of May, 2000, between AirGate PCS, Inc. (the "Company") and Xxxxxx X.
Xxxxxxxxx ("Executive").
BACKGROUND
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The Compensation Committee has determined that it is in the best interests
of the Company to provide the bonus described herein to Executive in recognition
of his leadership in achieving the successful public offering of the Company's
common stock and its strong performance since that time, and also to assure that
the Company will have the continued dedication of Executive over the ensuing
several months, notwithstanding the possibility or occurrence of a significant
restructuring or change of control of the Company. Therefore, in order to
accomplish these objectives, the Board has caused the Company to enter into this
Agreement.
In consideration of the mutual promises set forth below, and for other good
and valuable consideration, the sufficiency of which is acknowledged, the
Company and Executive hereby agree as follows:
AGREEMENT
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1. Effective Date. This Agreement shall be effective as of the date first
noted above (the "Effective Date").
2. Definitions. The following capitalized terms used in this Agreement
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shall have the meanings assigned to them below:
"Board" means the Board of Directors of the Company.
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"Cause" means (i) the willful and continued failure of Executive to
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substantially perform his duties with the Company (other than any such failure
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resulting from incapacity due to physical or mental illness, and specifically
excluding any failure by Executive, after reasonable efforts, to meet
performance expectations), or (ii) the willful engaging by Executive in illegal
conduct or gross misconduct that is materially and demonstrably injurious to the
Company. For purposes of this definition of "Cause", no act or failure to act,
on the part of Executive, shall be considered "willful" unless it is done, or
omitted to be done, by Executive in bad faith or without reasonable belief that
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or based upon the advice of counsel for the Company shall
be conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of the Company. The cessation of employment of
Executive shall not be deemed to be for Cause unless and until there shall have
been delivered to Executive a copy of a resolution duly adopted by the
affirmative vote of not less than two-thirds of the entire membership of the
Board of the Company at a meeting of such Board called and held for such purpose
(after reasonable notice is provided to Executive and Executive is given an
opportunity, together with counsel, to be heard before such Board), finding
that, in the good faith opinion of such Board, Executive is guilty of the
conduct described in subparagraph (i) or (ii) above, and specifying the
particulars thereof in detail.
"Change of Control" has the meaning assigned such term in that certain
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Option Agreement, dated as of July 28, 1999, by and between Executive and the
Company, as the same shall be amended from time to time (the "Option
Agreement").
"Compensation Committee" means the Compensation Committee of the Board.
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"Disability" means the inability of Executive, as determined by the Board,
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to perform the essential functions of his regular duties and responsibilities,
with or without reasonable accommodation, due to a medically determinable
physical or mental illness which has lasted (or can reasonably be expected to
last) for a period of six consecutive months. At the request of Executive or
his personal representative, the Board's determination that the Disability of
Executive has occurred shall be certified by two physicians mutually agreed upon
by Executive, or his personal representative, and the Company. Failing such
independent certification (if so requested by Executive), Executive's
termination shall be deemed a termination by the Company without Cause and not a
termination by reason of his Disability.
3. Retention Bonus. Provided that Executive is employed by the Company on
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the following payment dates (or if Executive's employment shall have been
terminated prior to such date by reason of his death, Disability, or termination
by the Company without Cause), the Company will pay to Executive a retention
bonus in the following amounts in accordance with the following schedule:
AMOUNT OF
PAYMENT RETENTION
DATE BONUS PAYABLE
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April 15, 2000 $900,000
January 15, 2001 $540,000
April 15, 2001 $180,000
July 15, 2001 $180,000
October 15, 2001 $180,000
January 15, 2002 $180,000
April 15, 2002 $180,000
July 15, 2002 $180,000
October 15, 2002 $180,000
January 15, 2003 $180,000
April 15, 2003 $180,000
July 15, 2003 $180,000
October 15, 2003 $180,000
January 15, 2004 $180,000
Notwithstanding the above schedule, in the event a Change of Control of the
Company shall have occurred, one-half of the then-remaining unpaid amount of the
Retention Bonus shall be paid to Executive in a lump cash payment within 30 days
following the date of such Change of Control and the other half of the
then-remaining unpaid amount of the Retention Bonus shall be payable in
accordance with the above schedule; provided, however, that if the Option
Agreement is hereafter amended to provide for 100% vesting of Executive's stock
options upon a Change of Control, then this Agreement shall be deemed to be
simultaneously amended, without further action, to provide that upon a Change of
Control all of the then-remaining unpaid amount of the Retention Bonus shall be
paid to Executive in a lump cash payment within 30 days following the date of
such Change of Control. In either case, if Executive's employment is terminated
without Cause prior to the occurrence of a Change of Control and if it can
reasonably be shown that such termination (i) was at the direction or request or
a third party that had taken steps reasonably calculated to effect the Change of
Control after such termination, or (ii) otherwise occurred in connection with,
or in anticipation of, the Change of Control, then Executive shall have the
rights described herein as if a Change of Control had occurred on the date
immediately preceding his termination of employment.
4. Successors, Binding Agreement.
(a) The Company will cause any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place.
(b) This Agreement shall inure to the benefit of and be enforceable by the
Company's successors and assigns and by Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devises and legatees.
5. Notice. Any notice required or permitted to be given by this Agreement
shall be effective only if in writing, delivered personally against receipt
therefor, or mailed by certified or registered mail, return receipt requested,
to the parties at the addresses hereinafter set forth, or at such other places
that either party may designate by notice to the other.
Notice to the Company shall be addressed to:
AirGate PCS, Inc.
Xxxxxx Tower
000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxxxx, Chief Financial Officer
Notice to Executive shall be addressed to him at his home address as then
indicated in the records of the Company.
All such notices shall be deemed effectively given five (5) days after the
same has been deposited in a post box under the exclusive control of the United
States Postal Service.
6. Miscellaneous.
(a) Amendments. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by Executive and such officer of the Company as may be
specifically designated by the Board or the Compensation Committee of the Board.
(b) Waivers. No waiver by either party hereto at any time of any breach by
the other party hereto of, or compliance with, any condition or 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.
(c) Entire Agreement. No agreement or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not expressly set forth in this Agreement.
(d) Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Delaware.
(e) Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
(f) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
(g) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
Atlanta, Georgia accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award
in any court having jurisdiction.
(h) Costs of Enforcement. Each party shall pay its own legal fees
and expenses incurred in connection with any arbitration (or other proceeding
whether or not instituted by the Company or Executive), relating to the
interpretation or enforcement of any provision of this Agreement (including any
action seeking to obtain or enforce any right or benefit by this Agreement).
(i) No Restriction on Employment Rights. This contract is in
relation to certain benefits and compensation only and is not to be construed as
an employment contract for a definite term. Nothing in this Agreement shall
confer on Executive any right to continue in the employ of the Company or shall
interfere with or restrict the rights of the Company, which are expressly
reserved, to discharge Executive at any time for any reason whatsoever, with or
without Cause. Nothing in this Agreement shall restrict the right of
Executive to terminate his employment with the Company at any time for any
reason whatsoever.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Agreement as of the date first above written.
AIRGATE PCS, INC.
By: /s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
Chariman of the
Compensation Committee
EXECUTIVE
/s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
