EXHIBIT 10bb
EMPLOYMENT AGREEMENT
THIS AGREEMENT by and between Xxxx Atlantic Corporation, a Delaware
corporation (the "Company"), and Xxxx X. Xxxxxxxxxx (the "Executive"), dated as
of the 14th day of August, 1997.
W I T N E S S E T H
WHEREAS, the Company and NYNEX Corporation, a Delaware corporation
("NYNEX"), have entered into an Amended and Restated Agreement and Plan of
Merger, dated as of July 2, 1996 (the "Merger Agreement"), whereby NYNEX will
merge with a wholly-owned subsidiary of the Company; and
WHEREAS, the Company and NYNEX wish to provide for the orderly succession
of the management of the Company following the Effective Time (as defined in the
Merger Agreement); and
WHEREAS, the Company and NYNEX further wish to provide for the employment
by the Company of the Executive, and the Executive wishes to serve the Company,
in the capacities and on the terms and conditions set forth in this Agreement;
NOW, THEREFORE, it is hereby agreed as follows:
1. EMPLOYMENT PERIOD. The Company shall employ the Executive, and the
Executive shall serve the Company, on the terms and conditions set forth in this
Agreement, for an initial period (the "Initial Period") and a further period
(the "Secondary Period") (the Initial Period and the Secondary Period are
hereinafter collectively referred to in the aggregate as the "Employment
Period"). The Initial Period shall begin at the Effective Time and end on (i)
the later of (a) one (1) year following the Effective Time, but no later than
December 31, 1998; or (b) July 1, 1998; or (ii) such earlier date as Xxxxxxx X.
Xxxxx ceases to be Chief Executive Officer of the Company for any reason. The
Secondary Period shall begin at the end of the Initial Period and end on that
date which is four (4) years after the first day of the Initial Period.
2. POSITION AND DUTIES. (a) During the Initial Period, the Executive
shall serve as the sole Vice Chairman of the Company, and as President and Chief
Operating Officer of the Company; during the Secondary Period, the Executive
shall serve as the sole Vice Chairman of the Company, and as President and Chief
Executive Officer of the Company; and on and after any date during the
Employment Period as of which Xxxxxxx X. Xxxxx ceases to be Chairman of the
Company, but in no event later than December 31, 1998, the Executive also shall
serve as the Chairman of the Company; in each case with such duties and
responsibilities as
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are customarily assigned to such positions, and such other duties and
responsibilities not inconsistent therewith as may from time to time be assigned
to him by the Board of Directors of the Company (the "Board"). The Executive
shall be a member of the Board on the first day of the Employment Period, and
the Board shall propose the Executive for re-election to the Board and for
positions specified above throughout the Employment Period.
(b) Until the Executive becomes Chairman, he shall report directly to the
Chairman and shall be the only officer reporting directly to the Chairman. An
Office of the Chairman comprised solely of the Chairman and the Executive shall
be established and the principal executive officers of the Company shall report
to that Office of the Chairman.
(c) During the Employment Period, and excluding any periods of vacation
and sick leave to which the Executive is entitled, the Executive shall devote
reasonable attention and time during normal business hours to the business and
affairs of the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive under this Agreement, use the
Executive's reasonable best efforts to carry out such responsibilities
faithfully and efficiently. It shall not be considered a violation of the
foregoing for the Executive to serve on corporate, industry, civic or charitable
boards or committees, so long as such activities do not significantly interfere
with the performance of the Executive's responsibilities as an employee of the
Company in accordance with this Agreement.
(d) The Company's headquarters shall be located in New York City, and the
Executive shall reside in the general area of New York City.
3. COMPENSATION. (a) BASE SALARY. The Executive's compensation during the
Employment Period shall be determined by the Board upon the recommendation of
the committee of the Board having responsibility for approving the compensation
of senior executives (the "Compensation Committee"), subject to the next
sentence and Section 3(b). During the Employment Period, the Executive shall
receive an annual base salary ("Annual Base Salary") of not less than his annual
base salary from NYNEX as in effect immediately before the Effective Time. The
Annual Base Salary shall be payable in accordance with the Company's regular
payroll practice for its senior executives, as in effect from time to time.
During the Employment Period, the Annual Base Salary shall be reviewed for
possible increase at least annually. Any increase in the Annual Base Salary
shall not limit or reduce any other obligation of the Company under this
Agreement. The Annual Base Salary shall not be reduced after any such increase,
and the term "Annual Base Salary" shall thereafter refer to the Annual Base
Salary as so increased.
(b) INCENTIVE COMPENSATION. During the Employment Period, the Executive
shall participate in short-term incentive compensation plans and long-term
incentive compensation plans (the latter to consist of plans offering stock
options, restricted stock and/or other long-term incentive compensation, as
adopted and approved by the Compensation Committee from time to time) providing
him with the opportunity to earn, in the aggregate, on a year-by-year basis,
short-term and long-term incentive compensation (the "Incentive
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Compensation") at least equal to the aggregate amounts that he had the
opportunity to earn under the ordinary annual grants under the comparable plans
of NYNEX as in effect immediately before the Effective Time.
(c) OTHER BENEFITS. (i) During the Employment Period and thereafter: (A)
the Executive shall be entitled to participate in all applicable incentive,
savings and retirement plans, practices, policies and programs of the Company to
the same extent as other senior executives (or, where applicable, retired senior
executives) of the Company, and (B) the Executive and/or the Executive's
eligible dependents, as the case may be, shall be eligible for participation in,
and shall receive all benefits under, all applicable welfare benefit plans,
practices, policies, and programs provided by the Company, other than severance
plans, practices, policies and programs but including, without limitation,
medical, prescription, dental, disability, salary continuance, employee life
insurance, group life insurance, accidental death and travel accident insurance
plans and programs, and, upon retirement, all applicable retirement benefit
plans to the same extent, and subject to the same terms, conditions, cost-
sharing requirements and the like, as other senior executives of the Company, as
such plans may be amended from time to time.
(ii) During the Employment Period, the Executive shall participate in one
or more supplemental executive retirement plans as may be adopted and amended by
the Compensation Committee from time to time ("SERPS") such that the aggregate
value of the retirement benefits that he and his beneficiaries will receive at
the end of the Employment Period under all pension benefit plans of the Company
and its affiliates (whether qualified or not) will be not less than the benefits
he would have received had he continued, through the end of the Employment
Period, to participate in the NYNEX Management Pension Plan, NYNEX Senior
Management Non-Qualified Defined Contribution Pension Plan (Executive Retirement
Account Plan), NYNEX Senior Management Non-Qualified Supplemental Savings Plan,
(collectively, the "NYNEX Plans"), as in effect immediately before the Effective
Time.
(iii) During the Employment Period, the Company shall provide the Executive
with life insurance coverage (the "Life Insurance Coverage") issued by
Metropolitan Life Insurance Company (or a comparable insurance carrier)
providing a death benefit to such beneficiary or beneficiaries as the Executive
may designate of not less than five (5) times his Annual Base Salary which has a
cash value feature which accumulates over a fifteen (15) year period at the end
of which period the Company recovers the premiums which it has paid into any
policy or policies providing such Life Insurance Coverage.
(d) FRINGE BENEFITS. During the Employment Period, the Executive shall be
entitled to receive fringe benefits of comparable value as he received from
NYNEX immediately before the Effective Time.
4. TERMINATION OF EMPLOYMENT. (a) DEATH OR DISABILITY. The Executive's
employment shall terminate automatically upon the Executive's death during the
Employment Period. The Company shall be entitled to terminate the Executive's
employment because of the Executive's Disability during the Employment Period.
"Disability" means that (i)
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the Executive has been unable, for the period specified in the Company's
disability plan for senior executives, but not less than a period of 180
consecutive business days, to perform the Executive's duties under this
Agreement, as a result of physical or mental illness or injury, and (ii) a
physician selected by the Company or its insurers, and acceptable to the
Executive or the Executive's legal representative, has determined that the
Executive is disabled within the meaning of the applicable disability plan for
senior executives. A termination of the Executive's employment by the Company
for Disability shall be communicated to the Executive by written notice, and
shall be effective on the 30th day after receipt of such notice by the Executive
(the "Disability Effective Date"), unless the Executive returns to full-time
performance of the Executive's duties before the Disability Effective Date.
(b) BY THE COMPANY. (i) The Company may terminate the Executive's
employment during the Employment Period for Cause or without Cause. "Cause"
means the conviction of the Executive for the commission of a felony, or willful
misconduct by the Executive, in either case that results in material and
demonstrable damage to the business or reputation of the Company. No act or
failure to act on the part of the Executive shall be considered "willful" unless
it is done, or omitted to be done, by the Executive in bad faith or without
reasonable belief that the Executive's action or omission was in the best
interests of the Company. Any act or failure to act that is based upon authority
given pursuant to a resolution duly adopted by the Board, or the advice of
counsel for the Company, shall be conclusively presumed to be done, or omitted
to be done, by the Executive in good faith and in the best interests of the
Company.
(ii) A termination of the Executive's employment for Cause shall be effected
in accordance with the following procedures. The Company shall give the
Executive written notice ("Notice of Termination for Cause") of its intention to
terminate the Executive's employment for Cause, setting forth in reasonable
detail the specific conduct of the Executive that it considers to constitute
Cause and the specific provision(s) of this Agreement on which it relies, and
stating the date, time and place of the Special Board Meeting for Cause. The
"Special Board Meeting for Cause" means a meeting of the Board called and held
specifically for the purpose of considering the Executive's termination for
Cause, that takes place not less than ten and not more than twenty business days
after the Executive receives the Notice of Termination for Cause. The Executive
shall be given an opportunity, together with counsel, to be heard at the Special
Board Meeting for Cause. The Executive's termination for Cause shall be
effective when and if a resolution is duly adopted at the Special Board Meeting
for Cause by affirmative vote of (A) three-quarters of the entire membership of
the Board if such action is taken prior to January 1, 1999, or (B) a majority of
the entire membership of the Board if such action is taken on or after January
1, 1999, in either case stating that, in the good faith opinion of the Board,
the Executive is guilty of the conduct described in the Notice of Termination
for Cause and that such conduct constitutes Cause under this Agreement.
(iii) A termination of the Executive's employment without Cause shall be
effected in accordance with the following procedures. The Company shall give the
Executive written notice ("Notice of Termination without Cause") of its
intention to terminate the Executive's employment without Cause, stating the
date, time and place of the Special Board Meeting
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without Cause. The "Special Board Meeting without Cause" means a meeting of the
Board called and held specifically for the purpose of considering the
Executive's termination without Cause, that takes place not less than ten and
not more than twenty business days after the Executive receives the Notice of
Termination without Cause. The Executive shall be given an opportunity, together
with counsel, to be heard at the Special Board Meeting without Cause. The
Executive's termination without Cause shall be effective when and if a
resolution is duly adopted at the Special Board Meeting without Cause by
affirmative vote of (A) three-quarters of the entire membership of the Board if
such action is taken prior to January 1, 1999, or (B) a majority of the entire
membership of the Board if such action is taken on or after January 1, 1999, in
either case stating that the Executive is terminated without Cause.
(c) GOOD REASON. (i) The Executive may terminate employment for Good
Reason or without Good Reason. "Good Reason" means:
A. the failure of the Company to appoint the Executive to
the position of Chief Executive Officer of the Company upon the
expiration of the Initial Period or Chairman on or before January
1, 1999, or in either case on any earlier date as of which Xxxxxxx
X. Xxxxx ceases to serve in either such capacity;
B. the assignment to the Executive of any duties or
responsibilities inconsistent in any respect with those customarily
associated with the positions to be held by the Executive pursuant
to this Agreement, or any other action by the Company that results
in a diminution in the Executive's position, authority, duties or
responsibilities, other than an isolated, insubstantial and
inadvertent action that is not taken in bad faith and is remedied
by the Company promptly after receipt of notice thereof from the
Executive;
C. any failure by the Company to comply with any provision
of Section 3 of this Agreement, other than an isolated,
insubstantial and inadvertent failure that is not taken in bad
faith and is remedied by the Company promptly after receipt of
notice thereof from the Executive;
D. any requirement by the Company that the Executive's
services be rendered primarily at a location or locations other
than that provided for in paragraph (d) of Section 2 of this
Agreement;
E. any purported termination of the Executive's employment
by the Company for a reason or in a manner not expressly permitted
by this Agreement;
F. any failure by the Company to comply with paragraph (c)
of Section 10 of this Agreement; or
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G. any other material breach of this Agreement by the
Company that either is not taken in good faith or is not remedied
by the Company promptly after receipt of notice thereof from the
Executive.
(ii) A termination of employment by the Executive for Good Reason shall be
effectuated by giving the Company written notice ("Notice of Termination for
Good Reason") of the termination, setting forth in reasonable detail the
specific conduct of the Company that constitutes Good Reason and the specific
provision(s) of this Agreement on which the Executive relies. A termination of
employment by the Executive for Good Reason shall be effective on the fifth
business day following the date when the Notice of Termination for Good Reason
is given, unless the notice sets forth a later date (which date shall in no
event be later than 30 days after the notice is given).
(iii) A termination of the Executive's employment by the Executive without
Good Reason shall be effected by giving the Company written notice of the
termination.
(d) NO WAIVER. The failure to set forth any fact or circumstance in a
Notice of Termination for Cause or a Notice of Termination for Good Reason shall
not constitute a waiver of the right to assert, and shall not preclude the party
giving notice from asserting, such fact or circumstance in an attempt to enforce
any right under or provision of this Agreement.
(e) DATE OF TERMINATION. The "Date of Termination" means the date of
the Executive's death, the Disability Effective Date, the date on which the
termination of the Executive's employment by the Company for Cause or without
Cause or by the Executive for Good Reason is effective, or the date on which the
Executive gives the Company notice of a termination of employment without Good
Reason, as the case may be.
5. OBLIGATIONS OF THE COMPANY UPON TERMINATION. (a) OTHER THAN FOR
CAUSE, DEATH OR DISABILITY, OR FOR GOOD REASON. If, during the Employment
Period, the Company terminates the Executive's employment for any reason other
than Cause, death or Disability, or the Executive terminates employment for Good
Reason, the Executive shall, upon termination of employment, cease active
participation, and commence participation as a retiree, in all retirement
benefit plans applicable to similarly situated senior executives, as such plans
may be amended from time to time. In such event, the Executive's benefits under
the SERPs, including any additional accrued benefit under any qualified defined
benefit plan which the Executive will have been precluded from receiving due to
the termination of his employment prior to the end of the Employment Period,
shall be calculated as though the Executive had remained employed with the
Company pursuant to the terms of this Agreement and had voluntarily retired at
the end of the Employment Period, but any cashout or annuity conversion of a
SERP benefit shall be based on the Executive's actual age at the time of
commencing the benefit. Moreover, in such event, subject to the terms and
conditions of this Agreement, the Company shall continue to provide the
Executive with the compensation and benefits set forth in paragraphs (a) and (b)
of Section 3 as if he had remained employed by the Company pursuant to this
Agreement through the end of the Employment Period and then
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retired; provided, that the Incentive Compensation for such period shall be
equal to the maximum Incentive Compensation that the Executive would have been
eligible to earn for such period; provided, further that in lieu of any further
grants of stock-based Incentive Compensation in the form of options or
otherwise, the Executive shall be paid cash equal to the Black-Scholes value
(without regard to any restrictions) of the stock options, and the fair market
value (without regard to any restrictions) of any restricted stock and other
stock-based awards that would otherwise have been granted; and provided,
further, that the Company shall pay to the Executive a sum equal to the sum of:
(a) the maximum value of any and all company matching contributions or other
company contributions which the Executive could have received under any
qualified or nonqualified defined contribution retirement plan, and (b) the
maximum value of the premiums to purchase employee welfare benefits which the
Executive would have received in the form of Company-paid benefits (as measured
by the Company's average plan cost of providing such benefits to such a
participant), which the Executive (and any of his eligible beneficiaries) could
have received had he remained employed pursuant to this Agreement until the end
of the Employment Period. In addition to the foregoing, any restricted stock
outstanding on the Date of Termination shall be fully vested as of the Date of
Termination and all options outstanding on the Date of Termination shall be
fully vested and exercisable and shall remain in effect and exercisable for the
maximum period of years allowable, from the date of the Executive's actual
retirement, under the terms of the Company's stock option plan applicable to a
senior executive who is eligible to retire. The payments and benefits provided
pursuant to this paragraph (a) of Section 5 are intended as liquidated damages
for a termination of the Executive's employment by the Company other than for
Cause or Disability or for the actions of the Company leading to a termination
of the Executive's employment by the Executive for Good Reason, and shall be the
sole and exclusive remedy therefor. Notwithstanding any other provisions of this
Section, in the event that the Executive, not later than the third anniversary
of the Effective Time, resigns for Good Reason within the meaning of Section
4(c)(A), upon failing to have been appointed Chief Executive Officer of the
Company upon the expiration of the Initial Period or Chairman on or before
January 1, 1999, or in either case upon the earlier cessation of Xxxxxxx X.
Xxxxx to serve in either such capacity, the liquidated damages otherwise payable
under this Section shall be supplemented by the amount by which the remuneration
earned by the Chairman and Chief Executive Officer of the Company from (i) the
second anniversary of the Effective Time (or, if earlier, the date on which a
person other than the Executive was appointed as successor to Xxxxxxx X. Xxxxx
as Chairman and Chief Executive Officer), to (ii) the fourth anniversary of the
Effective Time, exceeded the remuneration which the Executive earned while in
active service, or had a right under this Agreement to earn subsequent to his
Date of Termination, during that period.
(b) DEATH AND DISABILITY. If the Executive's employment is terminated by
reason of the Executive's death or Disability during the Employment Period, the
Company shall pay to the Executive or, in the case of the Executive's death, to
the Executive's designated beneficiaries (or, if there is no such beneficiary,
to the Executive's estate or legal representative), in a lump sum in cash within
30 days after the Date of Termination, the sum of the following amounts (the
"Accrued Obligations"): (1) any portion of the Executive's Annual Base Salary
through the Date of Termination that has not yet been paid; (2) an amount
representing any grants of Incentive
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Compensation, other than stock options, which have not, prior to the date of
Disability termination or death, resulted in awards of cash or shares for the
period that includes the Date of Termination, computed by assuming that the
amount of all such Incentive Compensation would be equal to the maximum amount
of such Incentive Compensation that the Executive would have been eligible to
earn for such period, and multiplying that amount by a fraction, the numerator
of which is the number of days in such period through the Date of Termination,
and the denominator of which is the total number of days in the relevant period;
(3) any compensation previously deferred by the Executive (together with any
accrued interest or earnings thereon) that has not yet been paid; and (4) any
accrued but unpaid Incentive Compensation and vacation pay; and the Company
shall have no further obligations under this Agreement, except as specified in
Section 6 below, and except as provided under the terms and conditions of any
stock options which are outstanding on such date of Disability termination or
death.
(c) BY THE COMPANY FOR CAUSE; BY THE EXECUTIVE OTHER THAN FOR GOOD REASON.
If the Executive's employment is terminated by the Company for Cause or the
Executive voluntarily terminates employment, other than for Good Reason, during
the Employment Period, the Company shall pay to the Executive in a lump sum in
cash within 30 days of the Date of Termination, (1) any portion of the
Executive's Annual Base Salary through the Date of Termination that has not been
paid; (2) any compensation previously deferred by the Executive (together with
any accrued interest or earnings thereon) that has not yet been paid; and (3)
any accrued but unpaid Incentive Compensation and vacation pay; and the Company
shall have no further obligations under this Agreement, except as specified in
Section 6 below.
(d) The Company's obligation to deliver the liquidated damages payments
described in paragraph (a) of this Section 5 shall be contingent on the
Executive delivering to the Company, on or about the Date of Termination, a
legal release in a form acceptable to counsel to the Company, releasing the
Company, its affiliates, and the current and former directors, officers and
employees of the Company, subject to the Company's continuing obligations under
this Agreement, and subject to the Executive's continuing rights under the terms
and conditions of the compensation and benefit plans in which the Executive is a
participant, as such plans may be amended from time to time. Moreover, the
Company's obligation to pay any such liquidated damages shall cease in the event
that the Board determines that the Executive, subsequent to his Termination of
Employment, has either materially breached any covenant of this Agreement which
then remains in force, or violated the terms of any agreement prohibiting
competition by the Executive which may then be in force as applied to the
Executive.
(e) (i) In the event that any payment or benefit received or to be
received by the Executive pursuant to the terms of this agreement (the "Contract
Payments") or of any other plan, arrangement or agreement of the Company (or any
affiliate) ("Other Payments" and, together with the Contract Payments, the
"Payments") would be subject to the excise tax (the "Excise Tax") imposed by
Section 4999 of the Code as determined as provided below, the Company shall pay
to the Executive, at the time specified in Section 5(e)(ii) below, an additional
amount (the "Gross-Up Payment") such that the net amount retained by the
Executive, after deduction of the Excise Tax on Payments and any federal, state
and local income tax and the Excise Tax upon the
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Gross-Up Payment, and any interest, penalties or additions to tax payable by the
Executive with respect thereto, shall be equal to the total present value (using
the applicable federal rate (as defined in Section 1274(d) of the Code in such
calculation) of the Payments at the time such Payments are to be made. For
purposes of determining whether any of the Payments will be subject to the
Excise Tax and the amounts of such Excise Tax, (1) the total amount of the
Payments shall be treated as "parachute payments" within the meaning of section
280G(b)(2) of the Code, and all "excess parachute payments" within the meaning
of section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax,
except to the extent that, in the opinion of independent counsel selected by the
Company and reasonably acceptable to the Executive ("Independent Counsel"), a
Payment (in whole or in part) does not constitute a "parachute payment" within
the meaning of section 280G(b)(2) of the Code, or such "excess parachute
payments" (in whole or in part) are not subject to the Excise Tax, (2) the
amount of the Payments that shall be treated as subject to the Excise Tax shall
be equal to the lesser of (A) the total amount of the Payments or (B) the amount
of "excess parachute payments" within the meaning of section 280G(b)(1) of the
Code (after applying clause (1) hereof), and (3) the value of any noncash
benefits or any deferred payment or benefit shall be determined by Independent
Counsel in accordance with the principles of sections 280G(d)(3) and (4) of the
Code. For purposes of determining the amount of the Gross-Up Payment, the
Executive shall be deemed to pay federal income taxes at the highest marginal
rates of federal income taxation applicable to the individuals in the calendar
year in which the Gross-Up Payment is to be made and state and local income
taxes at the highest marginal rates of taxation applicable to individuals as are
in effect in the state and locality of the Executive's residence in the calendar
year in which the Gross-Up Payment is to be made, net of the maximum reduction
in federal income taxes that can be obtained from deduction of such state and
local taxes, taking into account any limitations applicable to individuals
subject to federal income tax at the highest marginal rates.
(ii) The Gross-Up Payments provided for in Section 5(e)(i) hereof shall be
made upon the earlier of (i) the payment to the Executive of any Payment or (ii)
the imposition upon the Executive or payment by the Executive of any Excise Tax.
(iii) If it is established pursuant to a final determination of a court or
an Internal Revenue Service proceeding or the opinion of Independent Counsel
that the Excise Tax is less than the amount taken into account under Section
5(e)(i) hereof, the Executive shall repay to the Company within thirty (30) days
of the Executive's receipt of notice of such final determination or opinion the
portion of the Gross-Up Payment attributable to such reduction (plus the portion
of the Gross-Up Payment attributable to the Excise Tax and federal, state and
local income tax imposed on the Gross-Up Payment being repaid by the Executive
if such repayment results in a reduction in Excise Tax or a federal, state and
local income tax deduction) plus any interest received by the Executive on the
amount of such repayment. If it is established pursuant to a final determination
of a court or an Internal Revenue Service proceeding or the opinion of
Independent Counsel that the Excise Tax exceeds the amount taken into account
hereunder (including by reason of any payment the existence or amount of which
cannot be determined at the time of the Gross-Up Payment), the Company shall
make an additional Gross-Up Payment in
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respect of such excess within thirty (30) days of the Company's receipt of
notice of such final determination or opinion.
(iv) In the event of any change in, or further interpretation of, sections
280G or 4999 of the Code and the regulations promulgated thereunder, the
Executive shall be entitled, by written notice to the Company, to request an
opinion of Independent Counsel regarding the application of such change to any
of the foregoing, and the Company shall use its best efforts to cause such
opinion to be rendered as promptly as practicable. All fees and expenses of
Independent Counsel incurred in connection with this agreement shall be borne by
the Company.
6. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company or any of its affiliated companies
for which the Executive may qualify, nor, subject to paragraph (f) of Section
11, shall anything in this Agreement limit or otherwise affect such rights as
the Executive may have under any contract or agreement with the Company or any
of its affiliated companies. Vested benefits and other amounts that the
Executive is otherwise entitled to receive under the Incentive Compensation, the
SERPS, the Insurance Coverage, or any other plan, policy, practice or program
of, or any contract of agreement with, the Company or any of its affiliated
companies on or after the Date of Termination shall be payable in accordance
with the terms of each such plan, policy, practice, program, contract or
agreement, as the case may be, except as explicitly modified by this Agreement.
7. FULL SETTLEMENT. The Company's obligation to make the payments
provided for in, and otherwise to perform its obligations under, this Agreement
shall not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action that the Company may have against the Executive or
others. In no event shall the Executive be obligated to seek other employment or
take any other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and, except as
specifically provided in paragraph (a) of Section 5 with respect to benefits
described in clause (B) of paragraph (c)(i) of Section 3, such amounts shall not
be reduced, regardless of whether the Executive obtains other employment.
8. CONFIDENTIAL INFORMATION. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies and
their respective businesses that the Executive obtains during the Executive's
employment by the Company or any of its affiliated companies and that is not
public knowledge (other than as a result of the Executive's violation of this
Section 8) ("Confidential Information"). The Executive shall not communicate,
divulge or disseminate Confidential Information at any time during or after the
Executive's employment with the Company, except with the prior written consent
of the Company or as otherwise required by law or legal process.
9. ATTORNEYS' FEES. The Company agrees to pay, as incurred, to the
fullest extent permitted by law, all legal fees and expenses that the Executive
may reasonably incur as a
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result of any contest (regardless of the outcome) by the Company, the Executive
or others of the validity or enforceability of or liability under, or otherwise
involving, any provision of this Agreement, together with interest on any
delayed payment at the applicable federal rate provided for in Section
7872(f)(2)(A) of the Code.
10. SUCCESSORS. (a) This Agreement is personal to the Executive and,
without the prior written consent of the Company, shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.
(c) The Company shall require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company expressly to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would have been required to perform it if no such succession had taken
place. As used in this Agreement, "Company" shall mean both the Company as
defined above and any such successor that assumes and agrees to perform this
Agreement, by operation of law or otherwise.
11. MISCELLANEOUS. (a) This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. This Agreement may not
be amended or modified except by a written agreement executed by the parties
hereto or their respective successors and legal representatives.
(b) All notices and other communications under this Agreement shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive:
Xx. Xxxx X. Xxxxxxxxxx
0 Xxxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxx Xxxx 00000
If to the Company:
Xxxx Atlantic Corporation
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
11
or to such other address as either party furnishes to the other in writing in
accordance with this paragraph (b) of Section 11. Notices and communications
shall be effective when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held invalid or
unenforceable in part, the remaining portion of such provision, together with
all other provisions of this Agreement, shall remain valid and enforceable and
continue in full force and effect to the fullest extent consistent with law.
(d) Notwithstanding any other provision of this Agreement, the Company may
withhold from amounts payable under this Agreement all federal, state, local and
foreign taxes that are required to be withheld by applicable laws or
regulations.
(e) The Executive's or the Company's failure to insist upon strict
compliance with any provisions of, or to assert, any right under, this Agreement
(including, without limitation, the right of the Executive to terminate
employment for Good Reason pursuant to paragraph (c) of Section 4 of this
Agreement) shall not be deemed to be a waiver of such provision or right or of
any other provision of or right under this Agreement.
(f) The Executive and the Company acknowledge that this Agreement
supersedes any other agreement between them concerning the subject matter
hereof; provided, however, that the Company shall assume at the Effective Time
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the Retention Agreement for the benefit of the Executive adopted by NYNEX in
February 1996, a copy of which is attached hereto as Exhibit "A". Nothing in
this Agreement is intended to nullify any other obligation of the Executive
under any agreement or benefit plan which prohibits the disclosure of
proprietary information or prohibits the Executive from engaging in competitive
activities against NYNEX or the Company.
(g) The Company shall cause to be maintained through January 1, 1999
Section 5.11 of the Bylaws of the Company which requires (among other things) a
three-quarters vote of the entire Board in order to amend or modify the terms of
this Agreement.
(h) The rights and benefits of the Executive under this Agreement may not
be anticipated, assigned, alienated or subject to attachment, garnishment, levy,
execution or other legal or equitable process except as required by law. Any
attempt by the Executive to anticipate, alienate, assign, sell, transfer,
pledge, encumber or charge the same shall be void. Payments hereunder shall not
be considered assets of the Executive in the event of insolvency or bankruptcy.
(i) This Agreement may be executed in several counterparts, each of which
shall be deemed an original, and said counterparts shall constitute but one and
the same instrument.
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IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization of its Board, the Company has caused this
Agreement to be executed in its name on its behalf, all as of the day and year
first above written.
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Xxxx X. Xxxxxxxxxx
Xxxx Atlantic Corporation
By
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