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EXHIBIT 10.4
August 8, 1997
Xx. Xxxxx X. Xxxxxx
ProNet Inc.
0000 XXX Xxxxxxx
Xxxxxx, Xxxxx 00000
Dear Xxxxx:
This letter sets forth the agreement between you ("Executive") and
Metrocall, Inc. (the "Company") with respect to your rights under Section 8 of
your Employment Agreement ("Employment Agreement") with ProNet Inc. ("ProNet")
dated May 18, 1994, upon the Effective Time of the Merger of ProNet with and
into the Company pursuant to an Agreement and Plan of Merger between ProNet and
the Company of even date herewith ("Merger Agreement").
1. The Executive's employment with ProNet and its subsidiaries
will be terminated as of Effective Time of the Merger (the "Termination Date"),
and the Executive hereby tenders his resignation from all positions he now has
with ProNet, including as an officer, director, or member of any advisory boards
or committees, all such resignations to be effective as of the Termination Date.
This Agreement is contingent on and subject to the Closing under the Merger
Agreement, and neither party shall be bound by it, nor shall it have any force
and effect, unless and until the Closing occurs.
2. On or before the fifth day after the Termination Date, the
Company will pay to Executive the sum of $700,000 in cash in full satisfaction
of all obligations under Section 8(a) of the Employment Agreement. The
consideration to be paid to the Executive pursuant to this paragraph shall be
in full payment and in lieu of any and all of the Executive's benefits or
perquisites accrued but unpaid as of the Termination Date, including without
limitation salary, bonuses, vacation, sick leave, etc., and Executive's right to
receive payments under paragraph 8(a)(ii)(A) and benefits under paragraph
8(a)(ii)(B) of the Employment Agreement. Notwithstanding the foregoing, (i) the
Executive's split-dollar life insurance policy will be conveyed to him pursuant
to Section 4(f) of the Employment Agreement, and (ii) the Executive may elect
the payment of benefits to which he is entitled under any 401(k) plan of ProNet
as provided under the terms of any such plan. The foregoing shall not affect
the payment of compensation prior to the Effective Time of the Merger as
permitted by the Merger Agreement.
3. The Company shall indemnify and hold Executive harmless in the
event that it is asserted that any payment to Executive pursuant to this Letter
Agreement or any other payment by the Company to Executive is subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code or any
comparable federal, state, or local excise tax (such excise tax,
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Xx. Xxxxx X. Xxxxxx
August 8, 1997
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together with any interest and penalties, are hereinafter collectively referred
to as the "Excise Tax"), including paying to the Executive an additional amount
such that the net amount the Executive retains, after deduction of the Excise
Tax on such payments and any federal, state, and local income tax and Excise
Tax upon the payment provided for by this Section and any interest, penalties,
or additions to tax payable by the Executive with respect thereto shall be equal
to the total present value of the such payments at the time such payments are
made. Executive and the Company agree to cooperate in contesting any assertion
that an Excise Tax is payable.
If the foregoing correctly sets forth our agreement, please execute
this letter in the space indicated below and return it to the Company.
Sincerely,
METROCALL, INC.
By:
----------------------------
Name:
Title:
Accepted and Agreed:
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Xxxxx X. Xxxxxx
