1
EXHIBIT 10.3.4
EXECUTION COPY
AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
This AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (this "Amendment") is
dated as of February 16, 2001 between Xxxxx X. Xxxxxxxx ("Executive") and XO
Communications, Inc. ("Employer").
WHEREAS, Executive and Employer are parties to an Employment Agreement
dated as of June 16, 2000 (the "Employment Agreement")(capitalized terms used in
this Amendment without definition shall have the meanings set forth in the
Employment Agreement); and
WHEREAS, Executive and Employer wish to amend the Employment Agreement
in certain respects as set for this Amendment.
NOW THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
1. AMENDMENT TO SECTION 2 OF THE EMPLOYMENT AGREEMENT. The Employment
Agreement is amended by deleting Section 2 in its entirety and by substituting
in lieu thereof the following:
"2. EMPLOYMENT PERIOD
Subject to earlier termination as provided in section 5, the
term of Executive's employment under this Agreement shall commence as
of the Effective Date and shall continue until December 31, 2001 (the
"Employment Period").
2. AMENDMENT TO SECTION 3 OF THE EMPLOYMENT AGREEMENT. The Employment
Agreement is amended by deleting Section 3 in its entirety and by substituting
in lieu thereof the following:
"During the Employment Period, Executive shall hold the office
of Vice Chairman of the Board of Directors and shall devote such hours
as may be reasonably necessary to perform his duties hereunder (it
being agreed that from and after April 1, 2001 there shall be no
obligation on Executive to devote more that 10 hours per week for such
purpose) and during those hours shall devote all of his business time
and expend his best efforts, energies and skills to the Employer. It is
acknowledged and agreed that the Executive shall be allowed to serve on
(i) the Board of Directors of Asia Online, Ltd., Vertical Networks
Incorporated and WaveSplitter Technologies, Inc., (ii) the
Telecommunications Advisory Board of Compaq Computer Corp. and (iii)
the Technical Advisory Board of SonicWALL, Inc. and on such other
Boards of Directors and Advisory Boards as are approved by the Chief
2
Executive Officer of the Employer (the "CEO"), or his designee, so long
as such service does not materially interfere with Executive's duties
and responsibilities hereunder. In addition, Executive shall be
permitted to engage in certain investments as a venture capitalist or
angel investor as approved by the CEO, or his designee, so long as such
investment does not materially interfere with Executive's duties and
responsibilities hereunder. For purposes of obtaining the approval of
the CEO, or his designee, with respect to service on various Boards of
Directors and Advisory Boards and investment activities as set forth
above, permission will be deemed to be given by the CEO on the fifth
day following written notice by Executive to the CEO, unless prior to
such date the CEO provides written notice to the Executive of his
disapproval. The notice required in this Section 3 may be sent via
electronic mail, in which case such notice will be deemed given when
actually received in the designated party's electronic inbox. Executive
shall perform such duties as he may be assigned from time to time by
the Board of Directors of the Employer (the "Board"), the Chief
Executive Officer of the Employer or any officer of the Employer senior
in rank to Executive."
3. AMENDMENT TO SECTION 4.1 OF THE EMPLOYMENT AGREEMENT. The Employment
Agreement is amended by deleting Section 4.1 in its entirety and by substituting
in lieu thereof the following:
"4.1 Base Salary. For the nine-month period commencing April
1, 2001 and ending December 31, 2001, Employer shall pay to Executive
an annual base salary equal to $120,000 (the "Base Salary"). The Base
Salary shall be payable in accordance with the Employer's normal
payroll practices."
4. AMENDMENT TO SECTION 4.2 OF THE EMPLOYMENT AGREEMENT. The Employment
Agreement is amended by deleting Section 4.2 in its entirety and by substituting
in lieu thereof the following:
"4.2 Annual Bonus. For the fiscal year ended December 31,
2000, at the sole discretion of the Employer, Executive may receive a
bonus (the "Bonus") based upon attainment of annual performance
objectives to be established in the sole discretion of the Employer for
the Bonus year. Executive shall not be entitled to receive a Bonus for
the fiscal year ended December 31, 2001."
5. ACKNOWLEDGEMENT AND AGREEMENT REGARDING RIGHTS UNDER SECTION 5.3 OF THE
EMPLOYMENT AGREEMENT AND UNDER EXECUTIVE RETENTION BONUS PLAN.
(a) Executive acknowledges and agrees that the modifications
to the Employment Agreement contained in this Amendment shall not
constitute "Good Reason" for purposes of
- 2 -
3
Section 5.3 of the Employment Agreement, that nothing contained in this
Amendment shall give rise to any right on behalf of Executive to
terminate the Employment Period pursuant to Section 5.3 of the
Employment Agreement and that, for purposes of the definition of "Good
Reason" in the Employment Agreement, he is consenting to the
modifications to his employment arrangements contemplated by this
Amendment.
(b) Executive and Employer agree that for purposes of
determining the vesting of unvested shares of Restricted Stock and
payment of any unpaid amounts of Executive's Cash Bonus Target pursuant
to the Executive Retention Bonus Plan as it relates to that portion of
such shares and bonus that are earned based on the satisfaction of
performance standards for the year 2001, if Executive continues his
employment throughout the remainder of the Term, such shares shall
continue to vest and become transferable and no longer subject to
forfeiture and the payment of any unpaid portion of such Cash Bonus
Target shall be paid at the times set forth in the Executive Retention
Bonus Plan, but only to the degree that the Performance Goals in the
Executive Retention Bonus Plan are met, as though Executive were still
employed with the Employer on the date or dates of such vesting without
regard to whether Executive is so employed. The provisions of this
Section 5(b) shall not affect any rights Executive may have pursuant to
Section 6.1 of the Employment Agreement.
6. AMENDMENT TO SECTION 8 OF THE EMPLOYMENT AGREEMENT. The Employment
Agreement is amended by deleting the fourth full sentence of Section 8 in its
entirety and by substituting in lieu thereof the following:
"For purposes of obtaining the approval of the CEO, or his
designee, with respect to certain investment activities as a venture
capitalist or angel investor, as set forth above, permission will be
deemed to be given by the CEO on the fifth day following written notice
by Executive to the CEO, unless prior to such date the CEO provides
written notice to the Executive of his disapproval."
7. VACATION ACCRUAL. Executive acknowledges and agrees that under
Employer's vacation accrual policies Executive will cease to accrue vacation as
of April 1, 2001. The parties agree that Executive shall retain all rights under
Employer's vacation policy with respect to vacation accrued prior to April 1,
2001.
8. CONFIRMATION OF EMPLOYMENT AGREEMENT. Except as specifically amended by
this Agreement, the Employment Agreement shall remain in full force and effect
and is hereby ratified and confirmed.
- 3 -
4
9. GOVERNING LAW. This Amendment shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware, without reference
to the principles of conflicts of laws therein.
10. HEADINGS. All descriptive headings in this Amendment are inserted for
convenience only and shall be disregarded in construing or applying any
provision of this Amendment or the Employment Agreement.
11. COUNTERPARTS. This Amendment may be executed in counterparts, each of
which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
XO COMMUNICATIONS, INC.
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
/s/ Xxxxx X. Xxxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxxx
- 4 -
