Consulting Agreement
Exhibit 10.8
This Consulting Agreement (this “Agreement”) is entered into between ALLTEL Holding Corp.
(“Newco”) and Xxxx X. Xxxxxxx (“Xxxxxxx”), who will serve under this Agreement as an independent
contractor following completion of the pending merger of Newco and Valor Communications Group, Inc.
(“Valor”) pursuant to the terms of the Agreement and Plan of Merger, dated as of December 8, 2005
(the “Merger Agreement”), among ALLTEL Corporation, Newco and Valor (the “Merger”). Following the
Merger, Newco wishes to encourage Xxxxxxx’x future efforts on behalf of the combined organization
resulting from the Merger (“Windstream”), contingent upon the consummation of the Merger and
subject to the terms and conditions of this Agreement. This Agreement shall be binding on the
successors of ALLTEL Holding Corp. and Valor (which successor resulting from the Merger is referred
to herein as Windstream).
The parties agree that Xxxxxxx will act as an advisor to the Chairman and to the CEO of
Windstream commencing on the effective date of this Agreement, which will be the Effective Time, as
defined in the Merger Agreement and which is likely to occur in mid-2006. This Agreement shall have
a term of one year commencing on the effective date of this Agreement. This Agreement shall
automatically terminate, without further action by the parties and shall be of no further force or
effect, upon a termination of the Merger Agreement.
The parties agree that solely for purposes of Section 7.2 and 9.1 of Xxxxxxx’x Employment
Agreement with Valor dated as of February 14, 2005, as amended as of February 9, 2006 (the
“Employment Agreement”), and not for purposes of any other plan or arrangement of Valor, Xxxxxxx’x
employment shall be deemed to have terminated as of the effective time of this Agreement under the
circumstances described in Section 7.1(d) of the Employment Agreement. Therefore, the provisions
of Sections 9.1 and 9.5 of the Employment Agreement shall be superseded and replaced in their
entirety by the provisions set forth in Exhibit B of the Employment Agreement. For purposes of
interpreting the provisions of Sections 9.1 and 9.5 of Exhibit B to the Employment Agreement, the
terms “Company” and “Companies” shall refer to Valor and its subsidiaries and affiliates
immediately prior to the effective date of this Agreement. Nothing in this Agreement shall preclude
or limit the ability of Xxxxxxx during the term of this Agreement to interview for or accept a
position that will commence either during the term of this Agreement or following the expiration of
this Agreement. If Xxxxxxx commences employment or other consulting, contracting or advisory
services during the term of this Agreement, Xxxxxxx shall provide written notice to Windstream
prior to the start date of commencement of such employment or activity.
Newco and Windstream understand that such termination of Xxxxxxx’x employment and change of
control will trigger the payment of severance benefits under the terms of the Employment Agreement
and accelerate vesting of Xxxxxxx’x existing unvested equity awards under Xxxxxxx’x Restricted
Stock Grant Agreement dated as of February 14, 2005. Those payments will be in addition to
payments made by Windstream for the future consulting services Xxxxxxx will provide under this
Agreement. Except as provided above with respect to Sections 9.1 and 9.5, this Agreement will not
alter any continuing obligations of either party or the Company under the terms of the Employment
Agreement.
The scope of work will be as follows. From time to time during the term, Windstream may
request that Xxxxxxx provide advice and counsel regarding business issues/business plans or
strategy of Windstream in connection with Windstream’s operations. Xxxxxxx will work from his home
in Dallas, Texas. If Xxxxxxx is required or requested to travel and/or incur any unusual or
unanticipated expenses, Windstream agrees to pay all such reasonable expenses that Xxxxxxx incurs
to meet Windstream’s needs including such items as travel, lodging, meals, entertainment,
transportation or similar business expenses. Xxxxxxx will submit all such expenses to Windstream
for approval. Windstream also agrees to pay Xxxxxxx an amount of $1,500 per month for the purpose
of covering ongoing expenses that are expected to be
incurred by Xxxxxxx in the performance of his
services under this Agreement. Windstream will remit the
foregoing monthly amount to Xxxxxxx no less frequently than monthly in accordance with payment
procedures to be agreed upon by Xxxxxxx and Windstream.
In consideration for Xxxxxxx’x work, in addition to the expense reimbursement and monthly
payment described above, Windstream agrees to pay to Xxxxxxx an annual consulting fee of $500,000
payable as follows: $250,000 payable within 15 days of the effective date of this Agreement, and
$250,000 payable on the sixth month anniversary of the effective date of this Agreement but in any
event no later than March 15, 2007. Notwithstanding anything contained herein to the contrary,
Windstream shall not be obligated to make any payment or provide any benefit under this Agreement
(i) unless Xxxxxxx first executes a release in substantially the form attached as Exhibit A to his
Employment Agreement, and (ii) to the extent such payment or benefit is subject to the seven-day
revocation period prescribed by the Age Discrimination in Employment Act of 1967, as amended, or to
any similar revocation period in effect on the date of his termination of employment, such
revocation period has expired.
The parties acknowledge and agree that the payments to Xxxxxxx under this Agreement are made
exclusively in exchange for the future covenants of, and services to be rendered by, Xxxxxxx after
the Effective Time.
Xxxxxxx acknowledges that the execution of this Agreement does not impact or change in any way
Xxxxxxx’x continuing contractual, legal or fiduciary obligations owed to Valor prior to the
effective date of this Agreement.
To the extent applicable, the parties intend that this Agreement comply with the provisions of
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”). This Agreement shall
be construed, administered, and governed in a manner consistent with this intent. Any provision
that would cause any amount payable or benefit provided under this Agreement to be includable in
the gross income of Xxxxxxx under Section 409A(a)(1) of the Code shall have no force and effect
unless and until amended to cause such amount or benefit to not be so includable (which amendment
shall be negotiated in good faith by the parties and shall maintain, to the maximum extent
practicable, the original intent of the applicable provision without violating the requirements of
Section 409A of the Code).
Except for the automatic termination provided for above, it may not be modified or terminated
except in writing signed by the parties. This Agreement may be executed in counterparts. This
Agreement contains the entire agreement and understanding of the parties with respect to the
subject matter contained herein and supersedes all prior communications, representations and
negotiations in respect thereto. Newco shall have the right to deduct from all payments made under
this Agreement any federal, state, local, foreign or other taxes which are required to be withheld
with respect to such payments. This Agreement shall be interpreted and enforced in accordance with
the laws of the State of Delaware, without regard to conflicts of law principles.
This Agreement is executed as of the 1st day of May, 2006.
| ALLTEL HOLDING CORP. | XXXX X. XXXXXXX | |||
By:
|
/s/ Xxxxxxx X. Xxxxxxx | /s/ Xxxx X. Xxxxxxx | ||
| Name: Xxxxxxx X. Xxxxxxx | Name: Xxxx X. Xxxxxxx | |||
| Title: Chief Executive Officer | ||||
