1
EXHIBIT 10.1
AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into this 15th day of
July 1999, by and between WorldPort Communications, Inc., a Delaware corporation
("WorldPort"), and Xxxx X. Xxxxx ("Xxxxx").
WHEREAS, Xxxxx has served as an officer and senior executive of
WorldPort, pursuant to an Employment Agreement dated January 1, 1998, as amended
(the "Employment Agreement");
WHEREAS, Xxxxx serves as a member of the Board of Directors of
WorldPort and certain of its subsidiaries; and
WHEREAS, WorldPort and Xxxxx desire to confirm Xxxxx'x resignation from
employment and all officer and director positions with WorldPort and its
subsidiaries, effective as of the Effective Date (as hereinafter defined), and
the resulting termination of the Employment Agreement.
NOW, THEREFORE, in consideration of the premises, representations,
warranties, covenants, agreements and promises herein contained, the parties
agree, intending to be legally bound, as follows:
SECTION 1 RESIGNATIONS/TERMINATION OF EMPLOYMENT
1.1 Resignations. Xxxxx hereby resigns from all positions as a director or
officer of WorldPort and any of its subsidiaries, effective as of the
Effective Date. As used herein, the "Effective Date" shall be the
closing date of that certain $15.0 million investment in Worldport by
The Heico Companies, LLC in the form approved by Worldport's Board of
Directors. Worldport agrees to use its reasonable efforts to appoint (as
promptly as practicable after the Effective Date) an independent
director to fill the vacancy on Worldport's Board of Directors caused by
Xx. Xxxxx'x resignation.
1.2 Termination of Employment. Xxxxx and WorldPort hereby affirm and
acknowledge that, as of the Effective Date, any and all agreements and
understandings relating to Xxxxx'x employment by WorldPort are
terminated, other than the provisions of Sections 10, 11, 12, 13, 14 and
15 of the Employment Agreement, a copy of which is attached hereto as
EXHIBIT A, and this Agreement.
1.3 Return of WorldPort Property. As soon as practicable following the
Effective Date, Xxxxx shall return to WorldPort all items belonging to
WorldPort, including, without limitation, all records and other
documents obtained by him or entrusted to him during the course of his
relationship with WorldPort.
2
SECTION 2 PAYMENTS
In connection with the termination of any agreements and understandings relating
to Xxxxx'x employment by, and positions with, WorldPort and the agreements
contained herein, the parties hereto agree as follows:
(a) With respect to the balance of calender year 1999,
Worldport agrees to pay to Xxxxx the salary and bonus payments due
under the Employment Agreement, amounting to $300,000 in the aggregate,
of which $150,000 represents salary and $150,000 represents a bonus.
Such $300,000 shall be paid in six equal monthly installments of
$50,000 each, the first installment payable on the Effective Date and
the remaining installments payable on the last day of each month
thereafter. With respect to calender year 2000, WorldPort agrees to pay
to Xxxxx an aggregate of $450,000, payable in eleven equal monthly
installments of $25,000 each, commencing on January 31, 2000, and a
final installment of $175,000 payable on January 2, 2001;
(b) After the Effective Date, WorldPort agrees to continue to
provide Xxxxx with such medical and disability insurance benefits as
are currently provided to Xxxxx on the same terms, through the one-year
anniversary of the Effective Date, and after such anniversary Xxxxx
shall be entitled to elect to continue such coverage as provided by,
and subject to the terms and conditions of, COBRA;
(c) WorldPort agrees to reimburse Xxxxx for expenses incurred
for office rent and secretarial services from the Effective Date
through December 31, 2000 on the basis currently provided, up to a
maximum aggregate amount of $135,000, provided such expenses are
invoiced and accounted for in accordance with WorldPort's policies and
procedures, and to reimburse Xxxxx for legal expenses aggregating
$15,000 incurred for legal services related to the negotiation and
execution of this Agreement; and
(d) WorldPort agrees to promptly reimburse Xxxxx for all
reasonable expenses incurred by Xxxxx in performing services under the
Employment Agreement prior to the Effective Date, provided that such
expenses are incurred and accounted for in accordance with WorldPort's
policies and procedures. Expenses aggregating approximately $18,000
have already been incurred by Xxxxx and proper documentation has been
provided to Worldport, and Worldport agrees to promptly (and in any
event on or prior to the Effective Date) reimburse Xxxxx for them.
SECTION 3 REPRESENTATIONS AND COVENANTS
3.1 Indemnification. From and after the Effective Date, Worldport shall
indemnify Xxxxx in his capacity as an officer and director of Worldport
and its subsidiaries as provided in Worldport's Certificate of
Incorporation and By-laws as in effect on the Effective Date. A copy of
Article SEVEN of Worldport's Certificate of Incorporation and Articles
XII and XIII of Worldport's By-laws are attached hereto as EXHIBIT B.
2
3
3.2 Public Announcement. Attached hereto as EXHIBIT C is a copy of the press
release which WorldPort intends to issue with respect to this Agreement
and the subject matter thereof. Neither WorldPort nor Xxxxx will make
any public disclosures inconsistent with such press release.
SECTION 4 GENERAL PROVISIONS
4.1 Preferred Stock. Worldport agrees to promptly issue the shares of
non-participating preferred stock of Worldport referenced in, and in
accordance with the terms and provisions of, that certain Termination
Agreement, dated as of December 31, 1998, between Worldport and Maroon
Bells Capital Partners, Inc.
4.2 Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be delivered in person or sent
by registered or certified mail, postage prepaid, commercial overnight
courier (such as Express Mail, Federal Express, etc.) with written
verification of receipt or by telecopy to the following addresses:
If to WorldPort:
WorldPort Communications, Inc.
0000 Xxxxxxx Xxxxx Xxxx.
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: 000-000-0000
If to Xxxxx:
Xxxx X. Xxxxx
Any party may change its address for notice hereunder by notice to the
other party hereto.
4.3 Amendments and Waivers. This Agreement may be amended, superseded,
cancelled or renewed, and the terms and conditions hereof may be waived,
only by a written instrument signed by all parties or, in the case of a
waiver, by the party waiving compliance. No delay on the part of any
party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof.
4.4 Governing Law. The provisions of this Agreement shall be construed in
accordance with the laws of the State of Illinois.
4.5 Interpretation. Each of the parties hereby acknowledges and agrees that
if any court determines that any of the terms contained herein, or parts
thereof, are invalid or unenforceable, the remainder of the Agreement
shall not thereby be affected and shall be
3
4
given full effect, without regard to the invalid portions. Each of the
parties hereto further agrees that if any court determines that any of
the terms contained herein are unreasonable or unenforceable, the court
may interpret, alter, amend or modify any or all of the terms contained
herein to include as much of the scope, time period and intent as will
render such restrictions enforceable and, in its reduced form, such
terms shall then be enforceable.
4.6 Counterparts. This Agreement may be executed simultaneously in two or
more counterparts each of which shall be deemed an original, but all of
which together constitute one and the same instrument.
4.7 Successors. This Agreement shall not be assignable by Xxxxx without the
prior written consent of WorldPort otherwise than by will or the laws of
descent and distribution. This Agreement shall inure to the benefit of
and be binding upon the parties and their legal representatives,
successors and assigns.
4.8 Entire Transaction. This Agreement contains the entire understanding
among the parties with respect to the actions contemplated hereby and
supersede all other agreements, understandings and undertakings among
the parties on the subject matter hereof.
4.9 Dispute Resolution. All disputes, claims or controversies arising out of
or relating to this Agreement or the negotiation, validity or
performance hereto that are not resolved by mutual agreement shall be
resolved solely and exclusively by binding arbitration to be conducted
in accordance with this Section 4.9. The arbitration shall be held in
Chicago, Illinois before a single arbitrator and shall be conducted in
accordance with the rules and regulations promulgated by, the American
Arbitration Association (the "AAA") unless specifically modified herein.
The parties covenant and agree that they will participate in the
arbitration in good faith and that they will share equally its costs,
except as otherwise provided herein. The arbitrator may in his or her
discretion assess costs and expenses (including the reasonable legal
fees and expenses of the prevailing party) against any party to a
proceeding. The provisions of this Section 4.9 shall be enforceable in
any court of competent jurisdiction. The parties shall bear their own
attorneys' fees, costs and expenses in connection with the arbitration.
The parties will share equally in the fees and expenses charged by the
arbitrator. Each party consents to the jurisdiction of the courts of the
State of Illinois for the purposes of enforcing the arbitration
provisions of Section 4.9 of this Agreement. Each party further
irrevocably waives any objection to proceeding in the manner set forth
in this Section 4.9 based upon lack of personal jurisdiction or to the
laying of venue and further irrevocably and unconditionally waives and
agrees not to make a claim in any court that arbitration conducted in
accordance with this Section 4.9 has been brought in an inconvenient
forum.
Each of the parties hereto hereby consents to service of process by
registered mail at the address to which notices are to be given. Each
of the parties hereto agrees that its or his submission to jurisdiction
and its or his consent to service of process by mail is made for the
express benefit of the other parties hereto agree that its or his
submission to jurisdiction on its or his consent to service of process
by mail is made for the express benefit of the other parties hereto.
4
5
4.10 Replacement Stock Certificate. Worldport agrees to use its reasonable
efforts to cause the transfer agent of its capital stock to waive any
requirement that an indemnity bond be posted by Xxxxx as a condition to
the issuance of a replacement certificate to Xxxxx in respect of
approximately 191,000 shares of Worldport's capital stock, subject to
Worldport's receipt of an affidavit from Xxxxx in form and substance
satisfactory to Worldport.
5
6
IN WITNESS WHEREOF, each of the parties hereto has executed or caused
this Agreement to be executed all as of the date first written above.
WORLDPORT COMMUNICATIONS, INC.
By: /s/ Xxxx Xxxxxxx
---------------------------------------------
Xxxx Xxxxxxx
Chairman, President and Chief Executive Officer
/s/ Xxxx Xxxxx
------------------------------------------------
Xxxx X. Xxxxx
6
7
EXHIBIT C - PRESS RELEASE
(July [], 1999) - Atlanta, Georgia -- Worldport Communications, Inc. announced
today that Xx. Xxxx X. Xxxxx, the former Chairman and Chief Executive Officer of
the Company, has resigned as a director of the Company, effective immediately.
Xx. Xxxxx stated that "I have enjoyed my tenure with Worldport and feel
comfortable with the recent management hires we have made." Xx. Xxxxx plans to
return to working full-time for Maroon Bells Capital Partners, Inc., a merchant
banking firm in which he is a partner.
[ADD INFORMATION ABOUT WORLDPORT]
This press release contains certain forward-looking statements which can
sometimes be identified by the use of forward-looking words such as "may,"
"will," "anticipate", "plan," "estimate," "expect" or "intend." These statements
are subject to known and unknown risks, uncertainties and other factors,
including, but not limited to, the Company's limited operating history, history
of operating losses, substantial indebtedness and substantial capital
requirements, that could cause actual results to differ materially from those
contemplated by the statements. The Company does not undertake to publicly
update or revise its forward-looking statements even if experience or future
changes make it clear that any projected results expressed or implied therein
will not be realized. Additional information on risk factors that could
potentially affect the Company's financial results may be found in the Company's
public filings with the Securities and Exchange Commission. Certain of such
filings may be accessed through the Securities and Exchange Commission's web
site, xxxx://xxx.xxx.xxx.
7
