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EXHIBIT 10.3
January 11, 1999
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Dear <<_____________>>:
As you know, on July 27, 1998, GTE Corporation entered into an
Agreement and Plan of Merger (the "Definitive Agreement") with Xxxx Atlantic
Corporation ("Xxxx Atlantic"). In line with this decision, the businesses of
the two companies will be merged (the "Merger") on a date yet to be determined
("the Closing Date"). It is crucial that we continue to conduct business as
usual during the period preceding the Closing Date and that we retain people
like yourself whose skill is essential to our ongoing business efforts and/or
the Merger. This Agreement is intended to provide you with an incentive to
continue your employment through the Closing Date.
1. Merger Bonus. On or about 45 days following the Closing Date, you
will receive a merger implementation and retention bonus (a "Merger Bonus")
equal (before withholding of applicable taxes) to one and one half times the
sum of (i) your base annual salary as of the Closing Date and (ii) the prior
three-year average corporate rating (as of the date of shareholder approval of
the Merger) under GTE's Executive Incentive Plan ("EIP") for your grade level
as of the Closing Date multiplied by an amount equal to 100% of norm for that
grade level under EIP.
2. Involuntary Termination Without Cause. If your employment is
terminated involuntarily without Cause (and for reasons other than your death
or disability) prior to the Closing Date, you will receive a payment equal to
the Merger Bonus to which you would have been entitled had your employment
continued through the Closing Date. Payment will be made at the same time such
bonuses are paid to other eligible employees. Under no circumstances will your
resignation from employment or retirement for any reason constitute an
involuntary termination without Cause for purposes of this Agreement.
3. Death or Disability. Should the Merger be concluded as anticipated
and you die or become disabled (within the meaning of GTE's Long Term
Disability Plan) prior to the Closing Date, you, or, in the event of your
death, your estate, will receive a prorated Merger Bonus based on the ratio of
(i) the number of days you remained actively employed between the date of this
Agreement and the Closing Date to (ii) the number of days between the date of
this Agreement and the Closing Date. The prorated
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Merger Bonus payable under this paragraph shall be paid at the same time the
Merger Bonus is paid to other eligible employees.
4. Circumstances When No Bonus Will Be Paid. You will not receive a
Merger Bonus if the Closing Date does not occur. Should you resign or retire
for any reason prior to the Closing Date or should you at any time engage in
conduct that would constitute Cause, you will not be eligible to receive any
portion of the Merger Bonus. For purposes of this Agreement, Cause means (i)
failure to perform satisfactorily the duties assigned to you; (ii) breach of
any of the terms of this Agreement; (iii) violation of a law (other than a
traffic violation or minor civil offense), whether or not there has been a
conviction; or (iv) breach of any written company policy or agreement,
including, but not limited to, the Employee Agreement Relating to Intellectual
Property (Policy 412) or its equivalent (the "Employee Agreement Relating to
Intellectual Property"), or the Standards of Business Conduct, as each is
amended from time to time.
5. Prohibition Against Recruiting or Hiring. Commencing on the date of
this Agreement, and, in the event your employment is terminated for any reason,
for one year following such termination, you agree that you will not, without
the prior written consent of the Executive Compensation and Organizational
Structure Committee of GTE Corporation's Board of Directors, its designee, its
successor, or its successor's designee (the "ECC"):
(i) Recruit or solicit any employee of GTE (which, for purposes
of this Agreement, includes GTE Corporation, any corporate
subsidiary or other company affiliated with GTE Corporation,
any company in which GTE Corporation owns directly or
indirectly an equity interest of at least ten percent, and
the successors and assigns of any such company, including,
following the Merger, Xxxx Atlantic Corporation, its
subsidiaries, affiliates, and other related entities and
their successors and assigns) for employment or retention as
a consultant or provider of services;
(ii) Hire, or participate with another entity or third party in
the process of hiring, any employee of GTE;
(iii) Provide names or other information about GTE employees to any
person or business under circumstances that you know or
should know could lead to the use of that information for
purposes of recruiting or hiring; or
(iv) Interfere with the relationship between GTE and any of its
employees, agents, or representatives.
6. Prohibition Against Soliciting GTE Customers. Commencing on the
date of this Agreement, and, in the event your employment with GTE is
terminated for any reason, for one year following such termination, you agree
that you will not solicit or contact, directly or indirectly, any customer,
client, or prospect of GTE with whom you or any of the GTE employees reporting
to you had any contact at any time during the year preceding your termination
for the purpose of inducing such customer, client, or prospect to cease being,
or to not become, a customer or client of GTE or to divert business from GTE.
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7. Confidentiality. You agree that you will not disclose or discuss
either the existence or the terms of this Agreement under any circumstances
where such information could reasonably be expected to, directly or indirectly,
come to the attention of any present or former employee, contractor, or
consultant of GTE. You further agree that you will require anyone with whom you
share information regarding this Agreement to adhere to the same standard of
confidentiality.
8. Proprietary Information. You agree that you will at all times
comply with your obligations under the Employee Agreement Relating to
Intellectual Property and preserve the confidentiality of all Proprietary
Information and trade secrets of GTE and the Proprietary Information and trade
secrets of third parties, including customers, that are in the possession of
GTE by not disclosing the same to any other party or using the same, or any
portion thereof, for the benefit of anyone other than GTE. "Proprietary
Information" means information obtained or developed by you or to which you had
access during your employment with GTE, including, but not limited to, customer
information and other trade secrets and Proprietary Information of GTE and
third parties that has not been fully disclosed in a writing generally
circulated by GTE to the public at large without any restrictions on use or
disclosure. You agree that you will return all copies, in whole or in part, in
any form, of trade secrets and Proprietary Information in your possession or
control in the event of your termination of employment or upon request by GTE,
whichever occurs earlier, without making or retaining a copy.
9. Survival Of And Consideration For Covenants. You acknowledge and
agree that any payment made pursuant to this Agreement includes consideration
for the covenants contained in paragraphs 5, 6, 7, and 8 of this Agreement and
that the obligations set out in paragraphs 5, 6, 7, and 8 of this Agreement
survive any cancellation, termination, or expiration of this Agreement or the
termination of your employment with GTE.
10. Deferral. Amounts otherwise payable to you under this Agreement
may be deferred under GTE's EIP deferral regulations, or any successor
arrangement, in accordance with the terms of those regulations. Amounts
deferred under this Agreement shall not, however, be eligible for match under
GTE's Equity Participation Plan.
11. Payment Taxable/Not Benefit Bearing. Applicable taxes will be
withheld from any payment made pursuant to this Agreement. Amounts payable
under this Agreement shall not be treated as compensation for purposes of
computing or determining any benefit under any pension, savings, insurance, or
other employee compensation or benefit plan maintained by GTE.
12. No Duplication Of Benefits. Except for grants and agreements
specifically approved by the ECC, there shall be no duplication between any
payment provided for by this Agreement and any other retention incentive
program that provides for payment of a retention bonus for continued employment
during any part of the same time period covered by this Agreement. As a result,
any payment otherwise due under
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this Agreement shall be reduced by any amounts due under any such retention
incentive program.
13. Business Discretion Of GTE. Nothing in this Agreement is intended
to limit the discretion of GTE to take any action with regard to the Merger
that GTE may consider appropriate, including, without limitation, postponing
the Closing Date or terminating the Definitive Agreement. This Agreement does
not entitle you to remain in the employ of GTE for any minimum or prescribed
period of term and does not modify the at-will status of your employment.
14. Assignment By GTE. GTE may assign this Agreement without your
consent to any company that acquires all or substantially all of the stock or
assets of GTE, or into which or with which GTE is merged or consolidated. This
Agreement may not be assigned by you, and no person other than you (or your
estate) may assert your rights under this Agreement.
15. Dispute Resolution. You agree that the ECC shall have sole
discretion to interpret this Agreement and to resolve any and all disputes
under this Agreement, including, but not limited to, issues arising under
paragraphs 2, 4, 5, 6, 7, and 8. You further agree that the ECC's determination
shall be final and binding.
16. Waiver. The waiver by GTE of any breach of this Agreement shall
not be construed as a waiver of any subsequent breach.
17. Governing Law. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of New York, disregarding its choice of
law rules.
18. Remedies. You acknowledge that irreparable injury to GTE will
result in the event of any breach by you of any of the covenants or obligations
under this Agreement, including other obligations referenced herein. In the
event of a breach of any of your covenants and commitments under this
Agreement, including any other obligations referenced herein, GTE shall not be
obligated to make any payment otherwise required under this Agreement and may,
at GTE's discretion, require you to repay any amounts already paid to you,
including amounts that may have been deferred. In addition, GTE reserves all
rights to seek any and all remedies and damages permitted under law, including,
but not limited to, injunctive relief, equitable relief, and compensatory and
punitive damages.
19. Definitions/Relationship To Other Agreements. The definitions
contained in this Agreement, including but not limited to the definition of
Cause, shall be controlling for purposes of this Agreement. These definitions
shall not be modified by, nor shall they modify, definitions for terms in any
other agreement to which you may be a party.
20. Entire Agreement. You acknowledge and agree that this Agreement
sets forth the entire understanding of the parties with regard to the subject
matter addressed
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herein and that this Agreement supersedes all prior agreements and
communications, whether written or oral, pertaining to the incentive described
herein. This Agreement shall not be modified except by written agreement duly
executed by you and GTE.
I hope that the terms of this Agreement and the incentive just
described will provide you with a level of comfort as you continue your
valuable contributions to GTE. GTE believes you have made and will continue to
make a difference in our future -- we are truly pleased to have you on our
team. If this Agreement meets with your satisfaction, please sign below and
return the original to me within fifteen (15) business days.
Sincerely,
Xxxxxxx X. Xxx
Chairman & Chief Executive Officer
I have read, understand and agree to the foregoing.
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Employee's Signature
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Date
