EXHIBIT 10.29
February 28, 2003
Xxxxxxx Xxxxx
c/o Xxxxx Xxxxxx
Xxxxx & Xxxxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Employment Agreement
Dear Xxxxxxx:
This letter agreement (this "Agreement") confirms the terms and conditions of
your employment with AT&T Wireless Services, Inc. (the "Company"). Unless
otherwise stated expressly in this Agreement, this Agreement amends and
supercedes all prior agreements (including, without limitation, your April 2,
2002 employment agreement) between you and the Company concerning the subject
matter of this Agreement or your employment.
1. JOB RESPONSIBILITIES
Effective January 4, 2003, you will assume the new role of President of
Mobility Operations of the Company. In this capacity, you will report to
Xxxx Xxxxxx, Chief Executive Officer ("CEO") of the Company.
2. COMPENSATION
Your annual base salary will be increased to $625,000, less standard
payroll deductions, effective January 1, 2003. It is anticipated that this
rate will be reviewed on an annual basis to reflect individual performance
and appropriate base salary structure changes for senior officers of the
Company. In no event will your base salary be reduced at any time. Your
target bonus for 2003 will be set at 100% of base salary and will be
subject to appropriate performance criteria established by the
Compensation Committee of the Company's Board of Directors ("Compensation
Committee") consistent with that set for other senior officers of the
Company. Additionally, you will be eligible for a 2003 stock option grant
and other equity incentives of the type being granted to other senior
officers and Executive Vice Presidents ("EVPs") using the guidelines
approved by the Compensation Committee.
3. HIRING ARRANGEMENT
As a special incentive to accept this position, the Company will make a
one time payment to you in the amount of $400,000 less standard payroll
deductions, within 60 days of the signing of this Agreement.
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 2
4. TRAVEL AND LIVING EXPENSES
Until such time as you sell your current primary residence in New Jersey,
the Company will provide transportation to or reimburse you for reasonable
travel expenses to the Redmond, Washington area offices of the Company. In
addition, the Company will reimburse you for reasonable living expenses in
the Redmond, Washington area prior to the sale of your New Jersey
residence. The Company's tax allowance policy for executive imputed income
will apply to these expense reimbursements in accordance with its terms.
5. SPECIAL INDIVIDUAL NON-QUALIFIED SUPPLEMENTAL RETIREMENT ARRANGEMENTS
("SRAS")
Under this Agreement, the Company will continue to maintain three
arrangements as follows:
- "SRA1": This Agreement does not modify, in any respect, the terms of the
SRA1, established in Exhibit B of your Special Retention Agreement dated
January 3, 2000 and attached hereto as ADDENDUM A, which fully vested on
April 1, 2002.
- "SRA2": This Agreement does not modify, in any respect, the terms of the
SRA2, established in your special individual non-qualified supplemental
retirement arrangement dated April 24, 2001 and attached hereto as
ADDENDUM B, which fully vested on July 9, 2001.
- "SRA3": This Agreement does not modify, in any respect, the terms of the
SRA3, established in your prior employment agreement dated April 2, 2002
and attached hereto as ADDENDUM C, which fully vested on April 1, 2002.
You agree that the XXX0, XXX0 and SRA3 are subject to forfeiture (or
repayment if such amounts already have been paid) if you "establish a
relationship with a competitor of the company" in violation of the
Company's non-competition guidelines in effect at the time of the
violation, as amended in this paragraph below, any time prior to the
second anniversary of the termination of your employment. In the event of
a Change in Control (as defined in the then-existing Company Senior
Officer Severance Plan) at any time prior to the second anniversary of the
termination of your employment, the applicable non-competition guidelines
(the "guidelines") will be those in effect immediately prior to the Change
in Control; provided, however, that any such guidelines are not intended
to prevent you from owning an equity interest in any corporation that is
listed on a recognized securities exchange or traded in the
over-the-counter market, to the extent that such interest does not exceed
2% of the value or voting power of such corporation and does not
constitute control of such corporation; and, provided further, that you
may apply to the Executive Vice President,
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 3
Human Resources, for consent to compete or for a waiver of the operation
of the guidelines on the grounds that your contemplated activity or
relationship will not adversely impact the Company and is not within the
spirit and intent of the guidelines. The Executive Vice President, Human
Resources, shall evaluate your application, using reasonable judgment, and
shall not unreasonably deny your application. The current form of the
Company's non-competition guidelines are attached hereto as ADDENDUM D.
6. ADDITIONAL BENEFITS
Except for life insurance, which because of your former employment with
AT&T Corp., AT&T Corp. will provide under the AT&T Senior Management
Universal Life Insurance Plan, and as provided in this paragraph below,
you will receive benefits under the Company's current plans, programs and
policies for its senior officers and EVPs. You will continue to
participate in the Company Senior Officer Severance Plan or its
equivalent, according to its terms; provided, however, that any severance
payments under such Plan shall be reduced by the sum of $2,152,800 (plus
credited interest through the severance payment date) in consideration of
the prior award of the SRA3.
7. RESTRICTED STOCK UNITS
You had two traunches of restricted stock units ("RSUs") that were
unvested. The first traunch of 11,255 shares is subject to a performance
period that ended on December 31, 2002. The Compensation Committee
approved performance goals for the first traunch in accordance with
Section 162(m) of the Internal Revenue Code. The RSUs in the first traunch
have vested and were payable on February 1, 2003.
The balance of the unvested RSUs were contained in the second traunch
(11,255 shares) and have vested and were payable at the same time as the
first traunch. For purposes of clarification, all RSUs referenced above
have vested prior to the date of this Agreement.
8. STOCK OPTIONS
All stock options granted prior to the date of this Agreement shall remain
outstanding and subject to the terms and conditions of the existing grant
provisions, except as modified by Section 7 of your April 2, 2002
employment agreement, which provided as follows:
Stock options granted prior to February 16, 2002 will be treated as
if you had retired from the Company, will continue to vest
regardless of your termination of employment for whatever reason,
and will be exercisable until the original grant expiration date of
the option. Grants made in 2002 and beyond will
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 4
continue to vest regardless of your termination of employment for
whatever reason and be exercisable for the full length of the
original 10-year term if you meet the retirement eligibility
criteria in effect for these grants as of your termination date.
These criteria currently require achievement of age 55 and at least
10 years of net credited service upon termination. In the event of a
Company-initiated termination other than for Cause or in the event
you terminate employment for Good Reason, any outstanding unvested
options will be treated as if you had retired from the Company on
that date.
For purposes of this paragraph, Cause and Good Reason will be defined as
set forth in your April 2, 2002 employment agreement.
9. INDEMNIFICATION AND COOPERATION
The Company will indemnify and hold you harmless to the fullest extent
permitted by applicable law and the Company's Certificate of Incorporation
and By-Laws with regard to any action or inaction by you within the scope
of your job responsibilities, including, without limitation, those arising
as a director or member of any affiliate board or other board when the
Company has designated you to serve as a director or member. The Company
will cover you for activities on behalf of the Company to the fullest
extent permitted under its then-existing director and officer liability
insurance policy to the same extent it covers other officers and
directors.
Following the termination of your employment, except as otherwise
precluded by law, you will cooperate with and assist the Company in its
prosecution, conduct or defense of litigation, claims, investigations or
governmental audits in which the Company reasonably determines you have
relevant information or may be a witness. The Company will reimburse you
for the reasonable expenses you incur through such cooperation and
assistance.
10. EMPLOYMENT AT WILL
You understand and agree that your employment with the Company is at will
and for no specific length of time. This means that you may resign your
employment at any time, without any reason and without notice. This also
means that the Company may terminate your employment at any time, for any
or no reason, without or without cause, and with or without notice.
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 5
11. CONFIDENTIALITY AND REPORTING
You acknowledge and agree that information not generally known to the
public that relates to the business, technology, subscribers, customers,
employees, finances, plans, proposals, or practices of the Company or of
any third parties doing business with the Company ("Confidential or
Proprietary Information") is the sole property of the Company. You further
acknowledge and agree that Confidential and Proprietary Information
includes, but is not limited to, the trade secrets, business plans,
software programs, financial data, customer lists, identities of
subscribers, customers and prospects, marketing plans, nonpublic financial
information, and all other information Company designates as
"confidential" and all other information and matters not generally known
to the public. Confidential and Proprietary Information also does not
include (a) information generally known in the industry; and (b)
information received by you from a third party without a duty of
confidentiality. You agree that you will not at any time during the
balance of your employment, or at any time thereafter, disclose, copy or
in any way use any Confidential or Proprietary Information of the Company
or any subsidiary or affiliate of the Company, except as required in the
course of such employment or with the written permission of the Company
or, as applicable, any subsidiary or affiliate of the Company, or as may
be required by law; provided that, if you receive legal process with
regard to disclosure of such information, you will promptly notify the
Company and cooperate with the Company in seeking a protective order or
taking other appropriate action with respect to such legal process.
You agree that at the time of the termination of your employment with the
Company, whether, at the insistence of you or the Company, and regardless
of the reasons therefore, you will deliver to the Company, and not keep or
deliver to anyone else, any and all notes, files, memoranda, papers and,
in general, any and all physical matter containing information, including
any and all documents significant to the conduct of business of the
Company or any subsidiary or affiliate of the Company which are in your
possession, except for (a) any documents for which the Company or any
subsidiary or affiliate of the Company has given written consent to
removal at the time of the termination of your employment with the
Company; and (b) your personal rolodex, phone book and similar items. You
further agree that following the termination of your employment with the
Company, you will not use any computer access code or password belonging
to the Company and that you will not access any computer or database in
the possession or control of the Company.
You agree that the Company's remedies at law would be inadequate in the
event of a material breach or threatened breach of this Section 11;
accordingly, the Company may seek, in addition to its rights at law, an
injunction and other equitable relief without the need to post a bond.
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 6
All information, or actual compensation, other payments or benefits
received by you will be properly reported by you and the Company in
accordance with all applicable laws and regulations. You agree to
cooperate with the Company in reporting such information.
12. GOVERNING LAW
The construction, interpretation and performance of this Agreement will be
governed by the laws of the State of Washington, without regard to its
conflict of laws rules.
13. ARBITRATION/DISPUTE RESOLUTION
Any dispute, controversy, or question arising out of or relating to this
Agreement that cannot be resolved by good faith negotiation will be
subject to binding arbitration in accordance with this provision and the
CPR Rules for Non-Administered Arbitration of Business Disputes. To the
extent that the provisions of this Agreement and the prevailing rules of
the CPR conflict, the provisions of this Agreement shall govern. Any
arbitration must be commenced within two years of the occurrence of the
act or event giving rise to the underlying claim. The arbitration shall be
conducted by a sole arbitrator. The parties shall have 30 days after the
Respondent's receipt of the Notice of Arbitration to agree on a neutral
arbitrator from a list provided by CPR. The arbitration proceeding shall
be conducted in King County, Washington. The arbitration award shall be
made within 30 days of the conclusion of the arbitration, and shall be in
writing and specify the factual and legal bases for the award. The award
of the arbitrator may be entered in any court that has jurisdiction. After
service of the Notice of Arbitration and before the appointment of the
arbitrator, either party may apply to a court of competent jurisdiction
for temporary or interim injunctive relief. In the event that you are the
prevailing party, the Company will pay your attorneys' fees and costs
reasonably incurred, including the fees and expenses of the arbitrator. In
any other case, you and the Company will each bear all their own costs and
attorneys' fees, and will share equally in the fees and expenses of the
arbitrator.
14. SEVERABILITY AND NON-WAIVER
You agree that if any term or portion of this Agreement is held to be
void, invalid, illegal, or unenforceable in whole or in part, any such
term or portion of this Agreement shall be severed from the remainder of
this Agreement, which remainder shall remain in full force and effect.
Failure of the Company to insist upon strict adherence to any provision of
this Agreement or to enforce any provision, on one or more occasions,
shall not be deemed to be a waiver of its right to enforce any provision
in the future.
Xxxxxxx Xxxxx
Re: Employment Agreement
February 28, 2003
Page 7
15. ATTORNEY'S FEES
In the event you bring an action to enforce the terms of this Agreement
and prevail in any such action, the Company will pay your reasonable
attorney's fees and costs related to any such action. The Company agrees
to reimburse you for up to $7,500 for attorney's fees incurred by you in
connection with negotiating this Agreement.
Xxxxxxx, we continue to value your association with the Company. If you agree
with the foregoing, please sign this Agreement in the space provided below and
return the signed original to me for our files. Please maintain a copy for your
own records.
Sincerely,
Xxxx Xxxxxx
Executive Vice President,
Human Resources
I accept the terms and conditions described in this Agreement, which I have read
and understand.
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Xxxxxxx X. Xxxxx Date
