EXHIBIT 10.25
AGREEMENT FOR SERVICES
THIS AGREEMENT FOR SERVICES is made as of 10 December, 2001, between Xxxxx
Xxxxxx Xxxx ("Consultant") an individual whose address is 13221 Admiral Avenue,
Apartment C, Marina Del Ray, CA 90292, USA, and FLAG Telecom Holdings Limited
("FLAG Telecom"), a Bermuda company having its registered office at Xxxxx Xxxxx,
00 Xxxxx Xxxxxx, Xxxxxxxx, XX 00, Xxxxxxx.
WITNESSETH:
WHEREAS, FLAG Telecom desires to have Consultant act as an Advisor to FLAG
Telecom; and
WHEREAS, Consultant desires to perform such work for FLAG Telecom as an
independent contractor.
NOW, THEREFORE, in consideration of the recitals and of the mutual promises and
agreements in this Agreement, the parties agree:
1. SCOPE OF WORK
Consultant agrees to act as President of the FLAG Telecom Development
Company and Advisor to the Chairman and Chief Executive Officer ("CEO") of FLAG
Telecom for global operations. Consultant shall represent himself to third
parties as a strategic and business development advisor of FLAG Telecom.
Consultant shall be a director of FLAG Telecom.
2. COMPENSATION/WORK ARRANGEMENTS
(a) Consultant shall report to the work location or locations
designated by FLAG Telecom, on the date(s) designated by FLAG
Telecom.
(b) Consultant shall be paid a consultancy fee of US$30,000 per month
payable monthly in arrears for services hereunder. Payment of such
fee to commence on 31 January 2002.
(c) On 1st January 2002 FLAG Telecom shall grant Consultant an option
to purchase 300,000 shares in FLAG Telecom. The exercise price of
these shares shall be the closing price of FLAG Telecom shares as
on the day preceding the date of grant. Such option grant shall be
governed by the rules of FLAG Telecom's Long-Term Incentive Plan,
the special rules for Board members, and shall, subject to such
rules and to the terms and conditions of a grant certificate
substantially in the form attached hereto, vest in equal
instalments of 150,000 on 1st January 2003 and 1st January 2004
provided this Agreement has not been terminated for cause.
(d) During the term hereto FLAG Telecom shall maintain at FLAG
Telecom's expense medical and life insurance for the Consultant in
accordance with FLAG Telecom's insurance policy given to Senior
Executives.
(e) FLAG Telecom shall reimburse Consultant for actual and reasonable
out of pocket business expenses and reasonable living expenses
(hotel, meals, etc.) incurred by Consultant in connection with the
performance by Consultant of services hereunder, such expenses to
include travel expenses, telephone, fax and/or courier charges
which are related to the business of FLAG Telecom. First class
travel is authorised and all expenses claimed for reimbursement
will be submitted to the CEO for approval for subsequent payment
by FLAG Telecom.
(f) The Consultant will be eligible to receive a success fee of up to
US$250,000 each year ("the Success Fee") as reasonably determined
by the Chairman and Chief Executive Officer and payable in
instalments every six months based on the Consultant's performance
against the specific objectives attached in Appendix A.
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(g) FLAG Telecom shall provide the Consultant with a living allowance,
transportation and miscellaneous expense allowance of US$17,000
per month net of tax.
(h) The Consultant will be paid a lump sum of US$160,000 net of tax
towards his expenses of relocating from Jeddah to either Dubai or
Cairo prior to such relocation.
(i) Consultant will be reimbursed for home leave travel, including
business class airfare, for himself and his family once a year.
3. TAXES
a) The parties agree that for all tax-related purposes, and for all
purposes of this Agreement, Consultant is considered to be an
independent contractor. Consultant agrees that he shall be liable
for the payment of any and all taxes, subject to clause 3(c)
below, as required by any applicable law, including any taxes on
income, payroll or other tax required by any applicable
jurisdiction. Consultant agrees that he shall be liable for all
workers compensation or similar benefits, premiums and other
similar charges, subject to clause 3(c) below.
b) Consultant agrees to indemnify and hold harmless FLAG Telecom for
any taxes, interest, penalties, damages, costs, charges, expenses
or other sums incurred by FLAG Telecom, including, but not limited
to, charges or assessments from any revenue authority, arising
from any claim against FLAG Telecom by such authority based on the
services provided by Consultant under this agreement or
compensation paid to or by Consultant hereunder, subject to clause
3(c) below.
c) FLAG Telecom will provide tax equalisation to the Consultant such
that the Consultant will not be required to pay any more tax on
the fees paid under this particular Agreement by FLAG Telecom had
they been earned in Jeddah.
d) FLAG Telecom will reimburse to the Consultant the reasonable cost
of preparing the Consultant's tax returns for both Jeddah and in
either Dubai or Egypt to the extent that they relate to fees paid
under this particular Agreement.
4. FLAG INFORMATION
Information that is furnished to Consultant under this Agreement or
that Consultant comes into contact with on FLAG Telecom premises or on the
premises of any relevant Affiliate or under FLAG Telecom's or any such relevant
Affiliate's control ("FLAG Information"), shall remain the property of FLAG
Telecom or the relevant Affiliate. All copies of FLAG Information in written,
graphic or other tangible form shall be returned to FLAG Telecom at its request.
Unless such FLAG Information was previously known to Consultant free of any
obligation to keep it confidential, or has been or is subsequently made public
by FLAG Telecom, or a third party without breach of any agreement, it shall be
kept confidential by Consultant and such information shall be used only in
performing services under this Agreement, and may not be used or disclosed to
any other person, entity or for other purposes except upon such terms as may be
agreed upon between Consultant and FLAG Telecom in writing. FLAG Telecom may
require Consultant to sign a separate written agreement protecting FLAG
Information.
5. NO CONFLICT OF INTEREST
Consultant represents and warrants to FLAG Telecom that Consultant is
free to undertake the services required by this Agreement and that there is no
conflict of interest between Consultant's performance of this Agreement and any
other obligation Consultant may have to other parties. Consultant may perform
services for third parties provided that such services do not prevent Consultant
from performing its services hereunder in a timely manner and that services for
third parties are not in connection with any business which is competitive with
the business of FLAG Telecom or any Affiliate.
6. GOVERNMENT LAWS AND REGULATIONS
Consultant agrees, to the best of his ability, to comply with all
applicable laws of the jurisdictions in which services are performed under this
Agreement. Consultant also agrees to comply with all applicable US federal,
state or local laws, and regulations, including, but not limited to, all
applicable requirements of the US
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Foreign Corrupt Practices Act of 1977, as amended. Without limiting the
generality of the foregoing obligations, Consultant shall not use any part of
the compensation paid pursuant to this Agreement to make any payment or gift
directly or indirectly to any employee, officer or representative of any foreign
government, political party or candidate for political office under
circumstances in which such payment could constitute a bribe, kickback or
illegal payment under United States or applicable non-US laws. Consultant agrees
that any violation of US laws by Consultant shall entitle FLAG Telecom to
terminate this Agreement. Consultant agrees that it will not, in connection with
the performance of services hereunder, discriminate against any person on
account of race, colour, religion, sex or national origin.
7. AMENDMENTS
No modification, alteration or amendment of this Agreement shall be
effective unless contained in a writing signed by both parties and
specifically referring hereto.
8. LENGTH OF AGREEMENT/TERMINATION
This Agreement shall continue for a period of two years (the "Fixed
Term") from 1 January 2002.
Notwithstanding the "Fixed Term", the Consultant may terminate this
Agreement by 60 days' written notice to FLAG Telecom. On such termination FLAG
Telecom will not pay any further fees or allowances to the Consultant.
FLAG Telecom may terminate this Agreement at any time during the two
years (the "Fixed Term") from 1 January 2002 and will pay to the Consultant the
consultancy fee and allowances in clause 2 for the unexpired period of this
Agreement together with the Success Fee maximum for the year in which this
Agreement terminates.
9. CHOICE OF LAW AND JURISDICTION
This Agreement shall be governed by, and construed in accordance with,
the laws of England and subject to the jurisdiction of the English
Courts.
10.ENTIRE AGREEMENT
This Agreement constitutes the entire agreement and understanding
between the parties with respect to the subject matter hereof and merges and
supersedes all prior discussions and writings with respect thereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date and year first above written.
Consultant FLAG Telecom Holdings Limited
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By By
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APPENDIX A TO AGREEMENT FOR SERVICES
SPECIFIC OBJECTIVES TO BE MET BY CONSULTANT:
1. Advise CEO on Global Operations
o Advise on key issues
o Monitor specific locations or problems
o Participate in strategic direction meetings
o Represent FLAG Telecom in key events/conferences/meetings
2. President of Development Company
o Develop FLAG WEB project
- Co-ordinate and obtain financing
- Co-ordinate and obtain equity contributions
- Work together with VP of FLAG Middle East on presales
- Negotiate with partners and suppliers
- Direct technical, economic feasibility and surveys
- Close financing by mid 2002
- Organise and lead project team
- Propose future organisation and process
3. Serve on the Board of FTHL as member of management
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