Exhibit 10.1
EXECUTION COPY
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement") dated as of
February 11, 2005, by and between IWO Holdings, Inc., a Delaware corporation
(the "Company") and Xxxx X. Xxxxxxx (the "Executive", and together with the
Company, the "Parties").
W I T N E S S E T H :
A. The Company desires to employ the Executive, and the
Executive desires to be employed by the Company, on the terms and conditions set
forth in this Agreement.
B. The Executive acknowledges that (i) the Executive's
employment with the Company will provide the Executive with trade secrets of and
confidential information concerning the Company and (ii) the covenants contained
in this Agreement are essential to protect the business and goodwill of the
Company.
Accordingly, in consideration of the premises and the
respective covenants and agreements of the Parties set forth below, and
intending to be legally bound hereby, the Parties agree as follows:
Section 1. Employment. The Company hereby employs the
Executive, and the Executive hereby accepts such employment, on the terms and
conditions set forth in this Agreement.
Section 2. Term. Subject to the provisions of Section 8,
this Agreement shall be effective for a period commencing on the "Effective
Date," as that term is defined in the Plan of Reorganization of IWO Holdings,
Inc. under Chapter 11 of the Bankruptcy Code, as it may be amended from time to
time (hereinafter referred to as the "Effective Date") and ending on the day
immediately preceding the second anniversary of the Effective Date (the "Initial
Term"); provided, however, that such term shall be automatically extended for
successive twelve (12) month periods unless, no later than 90 days prior to the
expiration of the Initial Term or any extension thereof, either Party hereto
shall provide written notice to the other Party hereto of its or his desire not
to extend the term hereof (the Initial Term together with any extension shall be
referred to hereinafter as the "Term").
Section 3. Duties, Authority, Status and Responsibilities.
(a) The Executive shall serve as Chief Executive Officer of
the Company, and in such other positions as the board of directors of the
Company (the "Board") may from time to time reasonably determine, subject at all
times to the direction, supervision and authority of the Board. The Executive's
duties shall include such duties as the Board may from time to time reasonably
assign.
(b) During the Term and except as otherwise agreed by the
Company, the Executive shall devote the Executive's full employable time,
attention and best efforts to the business affairs of the Company (except during
vacations or illness) and will not actively engage in outside activities,
whether or not such activity is pursued for gain, profit or other pecuniary
advantage unless such activity (and the amount thereof) is approved by the
Board. In addition to the other titles and responsibilities described in this
Section 3, if requested by the Board, the Executive shall serve (without
additional compensation) during the Term as an officer of any subsidiary of the
Company.
Section 4. Cash Compensation.
(a) Base Salary. During the Term, the Executive shall
receive an annual base salary (the "Base Salary") of not less than $250,000. The
Base Salary shall be payable in accordance with the customary payroll practices
of the Company for salaried employees.
(b) Annual Bonus. During the Term, the Executive shall be
eligible to receive an annual cash bonus (the "Annual Bonus") in respect of each
fiscal year of the Company ending during the Term (a "Fiscal Year" which, as of
the Effective Date, is the period January 1 through December 31), with a target
bonus equal to 60% of Base Salary (the "Target Bonus") and a maximum bonus of
100% of Base Salary, subject to such performance targets established by the
Board for such Fiscal Year. Any such Annual Bonus shall be paid to the Executive
no later than other senior executives are paid their annual cash bonuses, but in
any event no later than a date which is two and one half (2 1/2) months
following the Fiscal Year to which such Annual Bonus relates.
(c) Retention Bonus. Upon a "Payment Event" (as defined
below), the Executive shall be entitled to receive a retention bonus (the
"Retention Bonus") in an amount equal to the product of (i) 138,889 multiplied
by (ii) the "Vested Percentage" (as defined below) multiplied by (iii) the
excess of the "Fair Market Value" (as defined in the Equity Award Plan referred
to below) of a share of "Common Stock" (as defined below) as of the date of the
Payment Event over $18.56 (such excess not to exceed $5.44). For purposes of the
foregoing, the term "Payment Event" shall mean the earliest to occur of: (i) if
Executive remains employed by the Company on such date, the third anniversary of
the Effective Date, (ii) if Executive remains employed by the Company on such
date, the date on which "Change in Control" occurs (as defined in Section 5(c)
below), or (iii) the date on which the Executive's employment is terminated due
to his death, by the Company due to "Disability" (as defined in Section 8(b)
below), without "Cause" (as defined in Section 8(c) below) or as a result of its
providing a written notice to Executive of its desire not to extend the Term or
by the Executive for "Good Reason" (as defined in Section 8(d) below). Subject
to the Executive's continued employment with the Company on each applicable
anniversary, the "Vested Percentage" shall equal 8.33% on the first three-month
anniversary of the Effective Date and shall increase by an additional 8.33% on
each subsequent three-month anniversary of the Effective Date, such that the
Vesting Percentage shall equal 100% on the third anniversary of the Effective,
provided, however, that, in the event of the Executive's termination pursuant to
Sections 8(a) or 8(b), the Vested Percentage shall equal 100%. The Retention
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Bonus shall be paid at the Company's election in cash, Common Stock or any
combination thereof as soon as reasonably practicable following the Payment
Event. Notwithstanding any of the foregoing, in no event shall the Executive
receive the Retention Bonus if his employment is terminated by the Company for
Cause prior to the Payment Date.
Section 5. Equity Compensation.
(a) Initial Option Grant. On the Effective Date, the
Executive shall be granted a stock option to purchase 138,889 shares of common
stock of the Company, (the "Common Stock"), which stock option is intended to
qualify as an "incentive stock option" within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code") and shall be referred to
herein as the "Initial Option Grant". The Initial Option Grant shall have a per
share exercise price of $24.00. Subject to the Executive's continued employment
with the Company, 8.33% of the Initial Option Grant shall vest on the first
three-month anniversary of the Effective Date and an additional 8.33% of the
Initial Option Grant shall vest on each subsequent three-month anniversary of
the Effective Date, such that the Initial Option Grant shall be 100% vested and
exercisable as of the third anniversary of the Effective Date. Any additional
terms of the Initial Option Grant shall be governed by an equity award plan to
be adopted by the Company on or prior to the Effective Date (the "Equity Award
Plan"), and the stock option agreement pursuant to which the Initial Option
Grant will be awarded (the "Option Agreement"). Notwithstanding the foregoing,
the Initial Option Grant shall vest in full upon a Change in Control.
(b) Future Option Grants. The Executive will also be
eligible for additional option grants under the Equity Award Plan or any
successor thereto; provided, that the making of any such grants, and the terms
and conditions applicable thereto, shall be determined by the Board (or the
appropriate committee thereof) in its sole discretion.
(c) Change in Control Defined. For purposes of this
Agreement, "Change in Control" shall mean the occurrence of any one of the
following events: (i) the acquisition by any "Person" (as such term is defined
in Section 3(a)(9) of the Securities Exchange Act of 1934 (the "Exchange Act")
and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) other than
AIG Global Investment Corp. or its Affiliates ("AIG") of more than 50% of the
combined voting power of the then outstanding securities entitled to vote
generally in the election of directors of the Company; provided, that any sale
by AIG of all of its Common Stock to any entity other than Sprint Corp., any
Affiliate of Sprint Corp., or any "Sprint Affiliate" (as defined below) shall
not constitute a Change in Control other than in connection with a sale of 75%
or more of the combined voting power of the then outstanding securities entitled
to vote generally in the election of directors of the Company, or (ii) any
merger, consolidation, reorganization, recapitalization, tender or exchange
offer or any other transaction with or affecting the Company as a result of
which a Person other than the stockholders of the Company immediately prior to
such transaction owns after such transaction more than 50% of the combined
voting power of the then outstanding securities entitled to vote generally in
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the election of the directors of the Company, or (iii) the sale, lease,
exchange, transfer or other disposition to any Person of all or substantially
all, of the assets of the Company and its consolidated subsidiaries; provided,
that, any such acquisition or sale to any entity which is an "Affiliate" (as
defined below) of the Company shall not constitute a Change in Control. For
purposes of this Agreement, an "Affiliate" of a Person shall mean any entity
controlling, controlled by, or under common control with, such Person and
"Sprint Affiliate" shall mean any of Alamosa Holdings Inc., AirGate PCS Inc.,
UbiquiTel Inc., Horizon PCS Inc., iPCS Inc. and US Unwired Inc and any of their
respective affiliates or successors.
Section 6. Expenses. During the Term, the Executive shall
be entitled to receive prompt reimbursement for all travel and business expenses
reasonably incurred and accounted for by the Executive (in accordance with the
policies and procedures established from time to time by the Company) in
performing services hereunder.
Section 7. Other Benefits.
(a) Employee Benefits, Fringe Benefits and Perquisites.
During the Term, the Executive shall be able to participate in employee benefit
plans and perquisite and fringe benefit programs on a basis no less favorable
than such benefits and perquisites are provided by the Company from time to time
to the Company's other senior executives.
(b) Vacations. The Executive shall be entitled to four (4)
weeks paid vacation during each year of the Term. The Executive shall also be
entitled to all paid holidays and personal days given by the Company to its
senior executives.
(c) Automobile. During the Term, the Company, at its sole
expense, shall provide the Executive with the use of an automobile and, upon
receipt by the Company of reasonable substantiation or documentation thereof,
shall pay all operating expenses (including maintenance, gasoline and insurance)
with respect to such automobile.
(d) Relocation Expenses. Upon receipt by the Company of
reasonable substantiation or documentation thereof, the Company shall reimburse
the Executive for expenses incurred for the sale of his residence in Utah and
other costs of relocating to New York in order to commence and/or continue his
employment under this Agreement, including, but not limited to, sales
commissions, points and fees on a mortgage, legal fees, airfare for the
Executive and his family and the movement of his household effects and other
personal property (collectively, "Relocation Expenses"). In addition, the
Company shall reimburse the Executive for the costs of maintaining an apartment
in Albany, New York or the vicinity thereof and for travel-related expenses
pertaining to commuting trips between his Utah residence and Albany, New York
from the Effective Date of this Agreement until the six-month anniversary of the
Effective Date. To the extent that any amounts paid to the Executive pursuant to
this Section 7(d) are properly includible as taxable income to the Executive for
federal, state or local income tax purposes but are not properly deductible by
the Executive, the Company shall pay the Executive such additional amounts as
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may be necessary to fully offset the taxes payable on the amounts paid to him
pursuant to this Section 7(d) (i.e., to "gross-up" the Executive on an after-tax
basis).
Section 8. Termination. The Executive's employment
hereunder may be terminated in accordance with Section 2 or under the following
circumstances:
(a) Death. The Executive's employment hereunder shall
terminate upon the Executive's death. Following any termination of the
Executive's employment hereunder as a result of this Section 8(a), (i) the
Executive's estate shall be entitled to receive his Base Salary through the date
of termination and any earned but unpaid Annual Bonus for any Fiscal Year
preceding the Fiscal Year in which the termination occurs and a pro rata bonus
for the year of termination equal to the Target Bonus multiplied by a fraction,
the numerator of which is the number of days having elapsed from the first day
of the Fiscal Year through the date of termination and the denominator of which
is 365 (the "Pro Rata Bonus"), and (ii) the unvested portion of the Initial
Option Grant shall immediately vest upon such termination and the Initial Option
Grant shall remain exercisable for the period set forth in the Option Agreement.
The Executive's estate shall have no further rights to any compensation
(including any Base Salary or Annual Bonus) or any other benefits under this
Agreement. All other benefits, if any, due to the Executive's estate following
the Executive's termination due to death shall be determined in accordance with
the plans, policies and practices of the Company; provided, however, that the
Executive (or his estate, as the case may be) shall not participate in any
severance plan, policy or program of the Company.
(b) Disability. The Company may terminate the Executive's
employment hereunder for Disability. "Disability" shall mean the Executive's
inability, due to physical or mental incapacity, to substantially perform the
Executive's duties and responsibilities under this Agreement for a period of 180
consecutive days. In conjunction with determining Disability for purposes of
this Agreement, the Executive hereby (i) consents to any such examinations which
are relevant to a determination of whether the Executive is mentally and/or
physically disabled and (ii) agrees to furnish such medical information as may
be reasonably requested, and to waive any applicable physician-patient privilege
that may arise because of such examination. Following any termination of the
Executive's employment hereunder pursuant to this Section 8(b), (A) the
Executive shall be entitled to receive his Base Salary through the date of
termination and any earned but unpaid Annual Bonus for any Fiscal Year preceding
the Fiscal Year in which the termination occurs and the Pro Rata Bonus and (B)
the unvested portion of the Initial Option Grant shall immediately vest upon
such termination and the Initial Option Grant shall remain exercisable for the
period set forth in the Option Agreement. The Executive shall have no further
rights to any compensation (including any Base Salary or Annual Bonus) or any
other benefits under this Agreement. All other benefits, if any, due to the
Executive following the Executive's termination by the Company for Disability
shall be determined in accordance with the plans, policies and practices of the
Company; provided, however, that the Executive shall not participate in any
severance plan, policy or program of the Company.
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(c) Termination for Cause, Voluntary Termination or
Non-Renewal Termination. At any time during the Term, (i) the Company may
terminate the Executive's employment hereunder for Cause by written notice,
specifying the grounds for Cause in reasonable detail, and (ii) the Executive
may terminate his employment hereunder "voluntarily" (that is, other than by
death, Disability or for Good Reason, in accordance with Section 8(a), 8(b) or
8(d)). "Cause" shall mean: (A) any conviction by a court of, or entry of a
pleading of guilty or nolo contendre by the Executive with respect to, a felony
or any lesser crime involving moral turpitude or a material element of which is
fraud or dishonesty; (B) the Executive's willful dishonesty of a substantial
nature towards the Company and any of its subsidiaries; (C) the Executive's
material breach of this Agreement, which breach is not cured by the Executive to
the reasonable satisfaction of the Company within 15 business days of the date
the Company delivers written notice of such breach to the Executive; or (D) the
Executive's use of alcohol or drugs which materially interferes with the
performance of his duties hereunder or which materially compromises the
integrity and reputation of the Executive or the Company.
Following the termination of the Executive's employment hereunder pursuant to
this Section 8(c) by the Company for Cause, (i) the Executive shall be entitled
to receive only his Base Salary through the date of termination and he shall
have no further rights to any compensation (including any Base Salary or Annual
Bonus) or any other benefits under this Agreement which have not vested prior to
his date of termination and (ii) both the vested and the unvested portions of
the Initial Option Grant shall automatically expire on the date of termination.
All other benefits, if any, due Executive following Executive's termination of
employment for Cause pursuant to this Section 8(c) shall be determined in
accordance with the plans, policies and practices of the Company; provided,
however, that Executive shall not participate in any severance plan, policy or
program of the Company.
Following the termination of the Executive's employment hereunder either
pursuant to this Section 8(c) due to the Executive's voluntary termination or by
the Company or the Executive pursuant to Section 2 as a result of providing a
written notice to the other Party hereto of its or his desire not to extend the
Term, (i) the Executive shall be entitled to receive his Base Salary through the
date of termination and any earned but unpaid Annual Bonus for any Fiscal Year
preceding the Fiscal Year in which the termination occurs, and, solely in the
case of the Executive's termination by the Company pursuant to Section 2 as a
result of its providing a written notice to Executive of its desire not to
extend the Term, the Pro Rata Bonus and (ii) the unvested portion of the Initial
Option Grant shall expire upon such termination and the vested portion of the
Initial Option Grant shall remain exercisable for the period set forth in the
Option Agreement. All other benefits, if any, due Executive following
Executive's termination of employment either pursuant to this Section 8(c) due
to the Executive's voluntary termination or by the Company or the Executive
pursuant to Section 2 as a result of providing a written notice to the other
Party hereto of its or his desire not to extend the Term shall be determined in
accordance with the plans, policies and practices of the Company; provided,
however, that Executive shall not participate in any severance plan, policy or
program of the Company.
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(d) Termination for Good Reason or Without Cause. At any
time during the Term, (i) the Executive may terminate the Executive's employment
hereunder for Good Reason and (ii) the Company may terminate the Executive's
employment hereunder without Cause (and other than for death or Disability).
"Good Reason" shall mean the occurrence, without the Executive's prior written
consent, of any of the following events: (A) a significant reduction in the
nature or scope of the Executive's authority or duties from those contemplated
by this Agreement; provided, that Good Reason shall not be deemed to occur
solely as a result of a transaction in which the Company becomes a substantially
wholly-owned subsidiary of another company or division so long as the
Executive's title, duties, responsibilities and authority described in Section
3(a), as they relate solely to the Company, are not reduced in any significant
manner; or (B) a reduction in the then current Base Salary, target Annual Bonus
or fringe benefits specific to the Executive; provided, that, any such event
described in (A) or (B) above shall not constitute Good Reason unless and until
the Executive shall have provided the Company with notice of such event and the
Company shall have failed to remedy such event within 30 days of receipt of such
notice.
Following the termination of the Executive's employment hereunder pursuant to
this Section 8(d), Executive shall receive (i) within five (5) days following
termination, a lump sum payment of (A) any earned but unpaid Base Salary through
the date of termination, (B) any earned but unpaid Bonus for any Fiscal Year
preceding the Fiscal Year in which the termination occurs, and (C) the Pro Rata
Bonus plus (ii) 12 monthly payments, commencing on the first day of the month
immediately following Executive's termination of employment, each of which shall
be equal to one 1/12 of the sum of (A) (x) if the termination occurs at any time
other than during the 12-month period following a Change in Control, one times
(1 x) the Executive's Base Salary (at the rate then in effect), and (y) if the
termination occurs during the 12-month period following a Change in Control, two
times (2 x) the Executive's Base Salary (at the rate then in effect) and (B) the
Executive's target Annual Bonus. In addition, upon a termination of Executive's
employment pursuant to this Section 8(d), (i) the unvested portion of the
Initial Option Grant shall expire upon such termination and the vested portion
of the Initial Option Grant shall remain exercisable for the period set forth in
the Option Agreement and (ii) the Company shall continue to provide health
benefits to the Executive for the one-year period following the date of
Executive's termination; provided, that the Company's obligation to provide any
such benefits shall cease with respect to such benefit at the time Executive
becomes eligible for such benefit from another employer. To the extent that the
provision of any health or other welfare benefit is not permissible after
termination of employment under the terms of the benefit plans of the Company
then in effect, the Company shall pay to Executive such amount as is necessary
to provide Executive, after tax, with an amount equal to the cost of acquiring,
for Executive and his spouse and dependents, if any, on a non-group basis, for
the required period, those health and other welfare benefits that would
otherwise be lost to Executive and his spouse and dependents as a result of
Executive's termination. The Executive shall have no further rights to any
compensation (including any Base Salary or Annual Bonus) or any other benefits
under this Agreement. All other benefits, if any, due Executive following a
termination pursuant to this Section 8(d) shall be determined in accordance with
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the plans, policies and practices of the Company; provided, however, that
Executive shall not participate in any severance plan, policy or program of the
Company.
(e) Execution of Release of All Claims. Notwithstanding any
other provision of this Agreement to the contrary, the Executive acknowledges
and agrees that any and all payments and benefits to which the Executive is
entitled under this Section 8 are conditional upon, and subject to, the
Executive's execution of a general release and waiver of claims in such
reasonable and customary form as shall be prepared by the Company.
(f) Notice of Termination. Any purported termination of
employment by the Company or Executive shall be communicated by a written Notice
of Termination to the Executive or the Company, respectively, delivered in
accordance with Section 10(e) hereof. For purposes of this Agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
termination provision in the Agreement relied upon, the date of termination, and
shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of employment under the provision so indicated.
The date of termination of the Executive's employment shall be the date so
stated in the Notice of Termination, which date, in the event of a termination
by Executive pursuant to Section 8(c) or 8(d) shall be no less than 30 (in the
case of a Section 8(d) termination) or 90 (in the case of a Section 8(c)
termination) days following the delivery of a Notice of Termination; provided,
however, that in the case of a termination for Cause by the Company, the date of
termination shall be the date the Notice of Termination is delivered in
accordance with Section 8(c).
Section 9. Certain Additional Payments by the Company. In
the event that it shall be determined that any payment or distribution by the
Company to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments required
under this Section 9, such payments or distributions being referred to herein as
"Payments") would give rise to liability of the Executive for the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code"), or that any interest or penalties are incurred by the Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (the "Gross-Up
Payment") in an amount such that after payment by the Executive of all Federal,
state and local taxes (including any interest or penalties imposed with respect
to such taxes), including, without limitation, any income and employment taxes
(and any interest and penalties imposed with respect to such taxes) and Excise
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments. For this
purpose, Executive shall be deemed to be in the highest marginal rate of
Federal, state and local taxes.
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Section 10. Restrictive Covenants.
(a) Noncompetition. In consideration of the payments by the
Company to the Executive pursuant to this Agreement, the Executive hereby
covenants and agrees that, during the Term and for the one-year period following
the date of the Executive's termination for any reason (the "Covenant Period"),
the Executive shall not, without the prior written consent of the Company,
engage in "Competition" (as defined below) with the Company or any of its
Affiliates (collectively, the "Company Group"). For purposes of this Agreement,
if the Executive takes any of the following actions he shall be engaged in
"Competition:" engaging in or carrying on, directly or indirectly, any
enterprise, whether as an advisor, principal, agent, partner, officer, director,
employee, stockholder, associate or consultant to any entity listed on the
competitor list attached as Exhibit A hereto or any affiliate of any such
entity, or any successor of any such entity or affiliate, in any of the Service
Area BTAs set forth on Exhibit B hereto; provided, however, that "Competition"
shall not include the passive ownership of securities in any public enterprise
and exercise of rights appurtenant thereto, so long as such securities represent
no more than two percent (2%) of the voting power of all securities of such
enterprise.
(b) Nonsolicitation; No-Hire. In further consideration of
the payments by the Company to the Executive pursuant to this Agreement, the
Executive hereby covenants and agrees that, during the Covenant Period and for
an additional 12 months thereafter, the Executive shall not knowingly (i)
attempt to influence, persuade or induce, or assist any other person in so
influencing, persuading or inducing, any employee or independent contractor of
the Company Group to give up, or to not commence, employment or a business
relationship with the Company Group, (ii) directly or indirectly hire or engage,
or cause to be hired or engaged, any person who is or was an employee or
independent contractor of the Company Group or (iii) attempt to influence,
persuade or induce, or assist any other person in so influencing, persuading or
inducing, any agent, consultant, vendor, supplier or customer of the Company
Group to give up or not commence, a business relationship with the Company
Group.
(c) Confidential Information. The Executive acknowledges
that the Company Group has a legitimate and continuing proprietary interest in
the protection of its confidential information and that it has invested
substantial sums and will continue to invest substantial sums to develop,
maintain and protect such confidential information. During the Term and at all
times thereafter, the Executive shall not, except with the written consent of
the Company or in connection with carrying out the Executive's duties or
responsibilities hereunder, furnish or make accessible to anyone or use for the
Executive's own benefit any trade secrets, confidential or proprietary
information of the Company Group, including its business plans, marketing plans,
strategies, systems, programs, methods, employee lists, computer programs,
insurance profiles and client lists; provided, that such protected information
shall not include information known to the public or otherwise in the public
domain without violation by the Executive of this Section 10(d). Notwithstanding
the foregoing, the Executive may disclose Confidential Information when required
to do so by a court of competent jurisdiction, by any governmental agency having
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supervisory authority over the business of the Company Group or by any
administrative body or legislative body (including a committee thereof) with
jurisdiction to order the Executive to divulge, disclose or make accessible such
information; provided, further, that in the event that Executive is ordered by a
court or other government agency to disclose any Confidential Information, the
Executive shall (i) promptly notify the Company of such order, (ii) at the
written request of the Company, diligently contest such order at the sole
expense of the Company as expenses occur, and (iii) at the written request of
the Company, seek to obtain, at the sole expense of the Company, such
confidential treatment as may be available under applicable laws for any
information disclosed under such order.
(d) Property of the Company. All memoranda, notes, lists,
records and other documents or papers (and all copies thereof) relating to the
Company Group, whether written or stored on electronic media, made or compiled
by or on behalf of the Executive in the course of the Executive's employment, or
made available to the Executive in the course of the Executive's employment,
relating to the Company Group, or to any entity which may hereafter become an
affiliate thereof, but excluding the Executive's personal effects, Rolodexes and
similar items, shall be the property of the Company, and shall, except as
otherwise agreed by the Company in writing, be delivered to the Company promptly
upon the termination of the Executive's employment with the Company for any
reason or at any other time upon request.
(e) Developments the Property of the Company. All
discoveries, inventions, ideas, technology, formulas, designs, software,
programs, algorithms, products, systems, applications, processes, procedures,
methods and improvements and enhancements conceived, developed or otherwise made
or created or produced by the Executive alone or with others, and in any way
relating to the Business, or the products or services of the Company Group,
whether or not subject to patent, copyright or other protection and whether or
not reduced to tangible form, at any time during the Term ("Developments"),
shall be the sole and exclusive property of the Company. The Executive agrees
to, and hereby does, assign to the Company, without any further consideration,
all of the Executive's right, title and interest throughout the world in and to
all Developments. The Executive agrees that all such Developments that are
copyrightable may constitute works made for hire under the copyright laws of the
United States and, as such, acknowledges that the Company or one of the members
of the Company Group, as the case may be, is the author of such Developments and
owns all of the rights comprised in the copyright of such Developments and the
Executive hereby assigns to the Company without any further consideration all of
the rights comprised in the copyright and other proprietary rights the Executive
may have in any such Development to the extent that it might not be considered a
work made for hire. The Executive shall make and maintain adequate and current
written records of all Developments and shall disclose all Developments
promptly, fully and in writing to the Company promptly after development of the
same, and at any time upon request.
(f) Enforcement. The Executive acknowledges and agrees that
the Company's remedies at law for a breach or threatened breach of any of the
provisions of Sections 10(a), (b), (c), (d) and (e) herein would be inadequate
and, in recognition of this fact, the Executive agrees that, in the event of
such a breach or threatened breach, in addition to any remedies at law, the
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Company, without posting any bond, shall be entitled to obtain equitable relief
in the form of specific performance, temporary restraining order, temporary or
permanent injunction or any other equitable remedy which may then be available.
In addition, the Company shall be entitled to immediately cease paying any
amounts remaining due or providing any benefits to the Executive pursuant to
Section 8 upon a good faith determination by the Board that the Executive has
violated any provision of Section 9. The Executive understands that the
provisions of Sections 10(a) and 10(b) may limit his ability to earn a
livelihood in a business similar to the Business but he nevertheless agrees and
hereby acknowledges that (i) such provisions do not impose a greater restraint
than is necessary to protect the goodwill or other business interests of the
Company, (ii) such provisions contain reasonable limitations as to time and
scope of activity to be restrained, (iii) such provisions are not harmful to the
general public, (iv) such provisions are not unduly burdensome to Executive, and
(v) the consideration provided hereunder is sufficient to compensate Executive
for the restrictions contained in Sections 10(a) and 10(b). In consideration of
the foregoing and in light of Executive's education, skills and abilities,
Executive agrees that he shall not assert that, and it should not be considered
that, any provisions of Sections 10(a) and 10(b) otherwise are void, voidable or
unenforceable or should be voided or held unenforceable. It is expressly
understood and agreed that although Executive and the Company consider the
restrictions contained in Sections 10(a) and 10(b) to be reasonable, if a
judicial determination is made by a court of competent jurisdiction that the
time or territory or any other restriction contained in this Agreement is an
unenforceable restriction against Executive, the provisions of this Agreement
shall not be rendered void but shall be deemed amended to apply as to such
maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable. Alternatively, if any court
of competent jurisdiction finds that any restriction contained in this Agreement
is unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein
Section 11. Miscellaneous.
(a) Executive's and Company's Representations. The
Executive hereby represents and warrants to the Company that (i) the execution,
delivery and performance of this Agreement by Executive does not and shall not
conflict with, breach, violate or cause a default under any contract, agreement,
instrument, order, judgment or decree to which Executive is a party or by which
he is bound; (ii) the Executive is not a party to or bound by an employment
agreement, non-compete agreement or confidentiality agreement with any other
person or entity which would interfere in any material respect with the
performance of his duties hereunder; and (iii) Executive shall not use any
confidential information or trade secrets of any person or party other than the
Company and its subsidiaries in connection with the performance of his duties
hereunder. The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement, that the Agreement has been duly
authorized by all necessary corporate action, that the performance of its
obligations under this Agreement will not violate any agreement between it and
any other person, firm or organization.
11
(b) Mitigation. The Executive shall have no duty to
mitigate his damages by seeking other employment and, should the Executive
actually receive compensation from any such other employment, the payments
required hereunder shall not be reduced or offset by any other compensation
except as specifically provided herein.
(c) Waiver.
(i) No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in a writing signed by the Executive and an officer of the Company (other than
the Executive) duly authorized by the Board to execute such amendment, waiver or
discharge. No waiver by either Party at any time of any breach of the other
Party of, or compliance with, any condition or provision of this Agreement to be
performed by such other Party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
(ii) Notwithstanding any other provision of this
Agreement to the contrary, the Company may, but shall not be obligated to,
modify the time and/or form of payment under any "Applicable Arrangement" (as
defined below) if and to the extent that the Company concludes such modification
to be necessary or desirable to avoid the imposition upon the Executive of the
additional taxes imposed on certain non-qualified deferred compensation
arrangements pursuant to Section 409A of the Code. In making any such
modification to an Applicable Arrangement, the Company's determination must be
made in good faith and upon prior written notice to the Executive, be based on
advice of counsel and be designed, in the Company's sole judgment, to fulfill as
closely as possible the Company's original commitment to the Executive under the
Applicable Arrangement without regard to Section 409A without increasing the
Company's costs under the Applicable Arrangement. For this purpose, "Applicable
Arrangements" shall mean the Retention Bonus referred to in Section 4(c) and,
following an initial public offering of the Company, any severance payments
under Section 8.
(d) Successors and Assigns. This Agreement shall be binding
on and inure to the benefit of the successors and assigns of the Company.
(e) Notice. For the purpose of this Agreement, notices and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given if delivered personally, if delivered by
overnight courier service, if sent by facsimile transmission or if mailed by
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses or sent via facsimile to the respective facsimile numbers,
as the case may be, as set forth below, or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt; provided,
however, that (i) notices sent by personal delivery or overnight courier shall
be deemed given when delivered; (ii) notices sent by facsimile transmission
12
shall be deemed given upon the sender's receipt of confirmation of complete
transmission, and (iii) notices sent by registered mail shall be deemed given
two days after the date of deposit in the mail.
If to the Executive, to such address as shall
most currently appear on the records of the Company.
If to the Company, to:
IWO Holdings, Inc.
00 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
(f) GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE WHOLLY PERFORMED WITHIN THAT
STATE, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS OF ANY JURISDICTION
WHICH WOULD CAUSE THE APPLICATION OF ANY LAW OTHER THAN THAT OF THE STATE OF NEW
YORK. ANY ACTION TO ENFORCE THIS AGREEMENT AND/OR THE EXHIBITS HERETO (OTHER
THAN AN ACTION WHICH MUST BE BROUGHT BY ARBITRATION PURSUANT TO SECTION 10(f))
MUST BE BROUGHT IN, AND THE PARTIES HEREBY CONSENT TO THE JURISDICTION OF, A
COURT SITUATED IN NEW YORK COUNTY, NEW YORK. EACH PARTY HEREBY WAIVES THE RIGHTS
TO CLAIM THAT ANY SUCH COURT IS AN INCONVENIENT FORUM FOR THE RESOLUTION OF ANY
SUCH ACTION.
(g) JURY TRIAL WAIVER. THE PARTIES EXPRESSLY AND KNOWINGLY
WAIVE ANY RIGHT TO A JURY TRIAL IN THE EVENT ANY ACTION ARISING UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR EXECUTIVE'S EMPLOYMENT WITH THE COMPANY IS
LITIGATED OR HEARD IN ANY COURT.
(h) Arbitration; Legal Fees. Any dispute, controversy or
other claim, other than disputes, controversies or claims relating to Section 10
(which disputes, controversies or claims shall be litigated in court in
accordance with the provisions of Sections 11(f) and (g) hereof), arising out of
or relating to (i) this Agreement, or (ii) the Executive's employment with the
Company shall be resolved by binding confidential arbitration before a single
arbitrator, to be held in New York City, New York in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. Judgment
upon the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. If the Executive prevails on any material issue which is
the subject of such arbitration or lawsuit, the Company shall be responsible for
all of the fees of the American Arbitration Association and the arbitrator (if
applicable) and any expenses relating to the conduct of the arbitration or
litigation (including the Company's and the Executive's reasonable attorneys'
fees and expenses). Otherwise, each party shall be responsible for its own
13
expenses relating to the conduct of the arbitration or litigation (including
reasonable attorneys' fees and expenses) and shall share the fees of the
American Arbitration Association and the arbitrator, if applicable, equally.
(i) Assignment. The Executive may not assign his rights or
interests under this Agreement. This Agreement may not be assigned by the
Company other than to an entity (i) which, directly or indirectly controls, is
controlled by or is under common control with the Company, or which is a
successor in interest to substantially all of the business operations of the
Company, and (ii) which assumes in writing or by operation of law, at the time
of the assignment, the Company's obligation to perform this Agreement.
(j) Severability of Invalid or Unenforceable Provisions.
The invalidity or unenforceability of any provision or provisions of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.
(k) Entire Agreement. This Agreement sets forth the entire
agreement of the Parties in respect of the subject matter contained herein and
supersedes as of the Effective Date all prior agreements, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written in respect of the subject matter contained herein, including, without
limitation, the Amended and Restated Consulting Agreement, dated as of November
30, 2004, by and among the Company, Xxxx Xxxxxxx Consulting LLC (the
"Consultant") and the Ad Hoc Committee of Certain Holders of the Company's 14.0%
Senior Notes due 2011 (the "Consulting Agreement"); provided, that Paragraphs 2
and 3 of the Consulting Agreement (to the extent such paragraphs relate to the
payment of fees due and expenses incurred prior to the Effective Date) and
Paragraph 6 of the Consulting Agreement shall remain in effect in accordance
with their terms. The Parties acknowledge and agree that in the event the
Effective Date does not occur, then this Agreement shall be void and of no force
and effect.
(l) Continuation of Employment. Unless the Parties
otherwise agree in writing, continuation of the Executive's employment with the
Company beyond the expiration of the Term shall be deemed an employment "at
will" and shall not be deemed to extend any of the provisions of this Agreement,
and Executive's employment may thereafter be terminated "at will" by Executive
or the Company.
(m) Withholding Taxes. The Company shall be entitled to
withhold from any payment due to the Executive hereunder any amounts required to
be withheld by applicable tax laws or regulations.
(n) Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.
14
IN WITNESS WHEREOF, the Parties have executed this
Employment Agreement as of the date first above written.
IWO HOLDINGS, INC.
By: /s/ Xxxxxxx Xxxxxx
---------------------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President and Chief Financial Officer
EXECUTIVE
By: /s/ Xxxx X. Xxxxxxx
------------------------------------
Xxxx X. Xxxxxxx
15
EXHIBIT A
---------
Competitor List
---------------
AT&T
Xxxxxx Communications Corp.
Cingular Wireless LLC
Nextel Communications Inc. (prior to Sprint Merger)
Rural Cellular
T-Mobile
Verizon Wireless Inc.
EXHIBIT B
---------
Service Area BTAs
-----------------
Albany-Schenectady, NY #0
Xxxxxxxxxx, XX #00
Xxxxxx, XX #51 (only Xxxxxxxx and Rockingham Counties)
Burlington, VT #63 (excluding Caledonia, Essex and Orleans Counties)
Xxxxxx-Xxxxxxx-Xxxxxxx, XX #000
Xxxxx Xxxxx, XX #000
Xxxxxx, XX #000
Xxxxx, XX #000
Lebanon-Claremont, NH #000
Xxxxxxxxxx-Xxxxxx-Xxxxxxx, XX #000 (excluding the metropolitan area of
Nashua, NH)
Xxx Xxxx, XX #000 (only Orange and Xxxxxxxx Counties)
Oneonta, NY #000
Xxxxxxxxxx, XX #000
Xxxxxxxxxxx, XX #352
Poughkeepsie-Kingston, NY #000
Xxxxxxx-Xxxxxxxxxx, XX #000
Xxxxxxxx, XX #438
Utica-Rome, NY #453
Xxxxxxxxx, XX #000
