1
EXHIBIT 10.39
EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into as of the 12th day of June, 1997 by and between
XXX XXXX ("Employee") and AIRTOUCH COMMUNICATIONS, INC., a Delaware corporation
(the "Corporation").
For ease of reference, this Agreement is divided into the following parts, which
begin on the pages indicated:
FIRST PART: TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND BENEFITS
DURING EMPLOYMENT (Sections 1-5, beginning on page 1)
SECOND PART: COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION NOT OCCURRING WITHIN THREE YEARS AFTER A CHANGE IN
CONTROL (Sections 6-8, beginning on page 6)
THIRD PART: COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION OCCURRING WITHIN THREE YEARS AFTER A CHANGE IN
CONTROL
(Sections 9-12, beginning on page 9)
FOURTH PART: PARACHUTE PAYMENTS
(Sections 13-14, beginning on page 12)
FIFTH PART: TRADE SECRETS, SUCCESSORS, MISCELLANEOUS PROVISIONS, SIGNATURE
PAGE (Sections 15-17, beginning on page 14)
-1-
2
FIRST PART: TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND BENEFITS
DURING EMPLOYMENT
SECTION 1: TERM OF EMPLOYMENT
(a) Basic Rule. The Corporation agrees to continue the Employee's
employment, and the Employee agrees to remain in employment with the
Corporation, from June 12, 1997, until the earliest of:
(1) The date of the Employee's death; or
(2) The date when the Employee's employment terminates pursuant to
Subsection (b), (c), (d) or (e) below.
(b) Early Termination or Resignation. The Corporation may terminate the
Employee's employment for any reason by giving the Employee not less
than 30 days' advance notice in writing. The Employee may terminate the
Employee's employment for any reason by giving the Corporation not less
than 30 days' advance notice in writing.
(c) Termination for Cause. The Corporation may terminate the Employee's
employment at any time for Cause shown by giving the Employee not less
than 30 days' advance notice in writing. For all purposes under this
Agreement, "Cause" shall mean (1) a willful failure by the Employee to
substantially perform the Employee's duties under this Agreement, other
than a failure resulting from the Employee's complete or partial
incapacity due to physical or mental illness or impairment, (2) a
willful act by the Employee that constitutes gross misconduct and that
is injurious to the Corporation, (3) a willful breach by the Employee of
a material provision of this Agreement or (4) a material and willful
violation of a federal or state law or regulation applicable to the
business of the Corporation. No act, or failure to act, by the Employee
shall be considered "willful" unless committed without good faith and
without a reasonable belief that the act or omission was in the
Corporation's best interest.
(d) Termination for Disability. The Corporation may terminate the Employee's
employment for Disability by giving the Employee not less than six
months' advance notice in writing. For all purposes under this
Agreement, "Disability" shall mean that the Employee, at the time notice
is given, has been unable to perform the Employee's duties under this
Agreement for a period of not less than six consecutive months as the
result of the Employee's incapacity due to physical or mental illness.
In the event that the Employee resumes the performance of substantially
all of the Employee's duties under this Agreement before the termination
of the Employee's employment under this Section becomes effective, the
notice of termination shall automatically be deemed to have been
revoked.
(e) Notice. For all purposes under this Section 1, the employment
relationship shall terminate on the date specified in the notice of
termination. Any waiver of notice
-2-
3
shall be valid only if it is made in writing and expressly refers to the
applicable notice requirement of this Section 1. If the Corporation
specifies a termination date that is earlier than the minimum advance
notice date required under Subsection (b), (c) or (d) (as applicable),
then the Employee is entitled to pay and benefits in lieu of the omitted
period of advance notice.
(f) Termination of Agreement. This Agreement shall expire when all
obligations of the parties hereunder have been satisfied.
(1) In General. In addition, except as described in Paragraph 2
below, either the Corporation or the Employee may terminate this
Agreement for any reason, and without affecting the Employee's
status as an employee, by giving the other party one year's
advance notice in writing.
(2) After a Change In Control. If a Change in Control occurs, the
Corporation may not provide notice of termination of this
Agreement under Paragraph (1) above within the two-year period
after the Change In Control. In other words, in this case, the
effective date of the termination of the Agreement may be no
earlier than three years after the Change in Control. For all
purposes under this Agreement, the term "Corporation" shall
include any successor to the Corporation's business and/or
assets that executes and delivers the assumption agreement
described in Subsection 16(a) of this Agreement or that becomes
bound by this Agreement by operation of law.
A termination of this Agreement pursuant to this Subsection (f) shall be
effective for all purposes at the end of the notice period, except that
such termination shall not effect the payment or provision of
compensation or benefits under this Agreement on account of a
termination of employment occurring prior to the termination of this
Agreement.
SECTION 2: DUTIES AND SCOPE OF EMPLOYMENT
(a) Position. The Corporation agrees to employ the Employee for the term of
employment under this Agreement in the position of Chairman and Chief
Executive Officer of AirTouch Communications, Inc., reporting to the
Corporation's Board of Directors (as such position was defined in terms
of responsibilities and compensation as of the effective date of this
Agreement). The Corporation, Subsidiary, Affiliate or Joint Venture
directly employing the Employee is referred to in this Agreement as the
"Employing Entity," and the Corporation, its Subsidiaries, Affiliates
and Joint Ventures are referred to, in the aggregate, in this Agreement
as the "AirTouch Group."
For all purposes under this Agreement, the terms "Affiliate,"
"Subsidiary" and "Joint Venture" shall mean the following:
(1) "Affiliate" shall mean any entity other than a Subsidiary, if
the Corporation and/or one or more Subsidiaries own(s) not less
than 50% of such entity.
-3-
4
(2) "Subsidiary" shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with
the Corporation, if each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or
more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.
(3) "Joint Venture" shall mean any entity (other than a Subsidiary
or Affiliate) in which the Corporation and/or one or more
Subsidiaries and/or one or more Affiliates has a direct or
indirect ownership interest.
(b) Obligations. During the term of employment under this Agreement, the
Employee shall devote the Employee's full business efforts and time to
the Employing Entity and the AirTouch Group. The foregoing shall not
preclude the Employee from engaging in appropriate civic, charitable or
religious activities or from devoting a reasonable amount of time to
private investments or from serving on the boards of directors of other
entities, as long as such activities and service do not interfere or
conflict with the Employee's responsibilities to the Employing Entity
and the AirTouch Group.
SECTION 3: BASE COMPENSATION
During the term of employment under this Agreement, the Corporation agrees to
pay (itself or through the Employing Entity) the Employee as compensation for
services a base salary at the annual rate of $835,000, or at such higher rate as
the Corporation's Compensation and Personnel Committee of the Board of Directors
may determine from time to time. Such salary shall be payable in accordance with
the standard payroll procedures of the Employing Entity. Once the Corporation's
Compensation and Personnel Committee of the Board of Directors has increased
such salary, it thereafter shall not be reduced; provided, however, that if a
Change in Control has not occurred, such salary (including any increases) may be
reduced by the Corporation if (1) the Employee commits an act or omission that
meets the definition of Cause, as defined in Section 1(c), or (2) the Employee
and all other officers of the Corporation who are parties to written employment
agreements containing substantially the same provisions as this Agreement have
their salaries (including any increases) reduced by the same percentage amount
for the same time period. The annual compensation specified in this Section 3,
together with any increases in such compensation that the Compensation and
Personnel Committee of the Board of Directors of the Corporation may grant from
time to time, and together with any reductions made in accordance with this
Section 3, is referred to in this Agreement as "Base Compensation."
SECTION 4: EMPLOYEE BENEFITS
(a) In General. During the term of employment under this Agreement, the
Employee shall be eligible to participate in the employee benefit plans
and executive compensation programs maintained by the Employing Entity,
including (without limitation) pension plans, savings or profit-sharing
plans, deferred compensation plans, supplemental retirement or
excess-benefit plans, stock option, incentive or other bonus plans,
life, disability, health, accident and other insurance programs, paid
vacations, and similar plans or programs, subject in each case to the
-4-
5
generally applicable terms and conditions of the plan or program in
question and to the discretion and determinations of any person,
committee or entity administering such plan or program.
(b) Accelerated Vesting in Incentive Awards in Case of a Change in Control
of the Corporation. If, during the term of this Agreement, a Change in
Control (as defined in Section 12) occurs with respect to the
Corporation, then each of the incentive awards heretofore or hereafter
granted to the Employee by the members of the AirTouch Group or their
delegates shall become fully vested, fully exercisable or fully payable,
as the case may be, any contrary provisions of such awards or the
applicable plan notwithstanding. The term "incentive award" shall
include, without limitation, all awards under the AirTouch
Communications, Inc. 1993 Long-Term Stock Incentive Plan, all other
awards with respect to equity or derivative securities of the AirTouch
Group, and all cash incentive awards.
(c) Accelerated Vesting in Supplemental Pension Benefits in Case of a Change
in Control of the Corporation. If, during the term of this Agreement, a
Change in Control (as defined in Section 12) occurs with respect to the
Corporation, then all of the Employee's supplemental pension benefits
shall become fully vested, any contrary provisions of the applicable
plan notwithstanding. The term "supplemental pension benefit" shall
include, without limitation, all retirement benefits provided under a
plan or program of the AirTouch Group that is not intended to qualify
under section 401(a) of the Internal Revenue Code of 1986, as amended
(the "Code").
SECTION 5: BUSINESS EXPENSES AND TRAVEL
During the term of employment under this Agreement, the Employee shall be
authorized to incur necessary and reasonable travel, entertainment and other
business expenses in connection with the Employee's duties hereunder. The
Employing Entity shall reimburse the Employee for such expenses upon
presentation of an itemized account and appropriate supporting documentation,
all in accordance with generally applicable policies.
-5-
6
SECOND PART: COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION NOT OCCURRING WITHIN THREE YEARS AFTER A CHANGE IN
CONTROL
SECTION 6: TERMINATIONS NOT RELATING TO A CHANGE IN CONTROL
This Second Part of the Agreement, consisting of Sections 6 through 8, describes
the benefits and compensation, if any, payable in case of termination of
employment that does not occur within three years after a Change in Control (as
defined in Section 12). The Third Part of the Agreement, consisting of Sections
9 through 12, describes benefits and compensation, if any, payable in case of
termination occurring within three years after a Change in Control. If benefits
and compensation are payable under this Second Part, then no benefits and
compensation are payable under the Third Part.
SECTION 7: INVOLUNTARY TERMINATION WITHOUT CAUSE OR DISABILITY
In the event that, during the term of this Agreement, the Corporation or
Employing Entity terminates the Employee's employment with the AirTouch Group
for any reason other than Cause or Disability, and such termination does not
occur within three years after a Change in Control, then, after executing the
release of claims described in Section 7(e), the Employee shall be entitled to
receive the following payments and benefits:
(a) Severance (2x payment). The Corporation shall pay to the Employee in a
lump sum, not less than 31 days nor more than 120 days following the
date of the employment termination, an amount equal to the following:
(1) Two times the Employee's Base Compensation in effect on the date
of the employment termination; plus
(2) 200% of the target Team Award under the AirTouch Communications
Short-Term Incentive Plan, for the Employee's position as of the
date of the termination.
Any other provision of this Agreement or of the AirTouch Communications
Short-Term Incentive Plan notwithstanding, after the amount described in
this Subsection (a) has been paid to the Employee, the Employee shall
have no further interest in such Short-Term Incentive Plan.
(b) Two Years of Life Insurance and Health Plan Coverage. The coverage
described in this Subsection (b) shall be provided for a "Continuation
Period" beginning on the date when the employment termination is
effective and ending on the earlier of (1) the two-year anniversary of
the date when the employment termination is effective or (2) the date of
the Employee's death. During the Continuation Period, the Employee (and,
where applicable, the Employee's dependents) shall be entitled to
continue participation in the basic and supplemental group term life
insurance plan and in the health care plan for employees maintained by
the Employing Entity as if the Employee were still an employee of the
Employing Entity, but only if the Employee does not elect any
-6-
7
continuation coverage under Part 6 of Title I of the Employee Retirement
Income Security Act of 1974, as amended. Where applicable, the
Employee's compensation for purposes of such plans shall be deemed to be
equal to the Employee's compensation (as defined in such plans) in
effect on the date of the employment termination. To the extent that the
Corporation finds it undesirable to cover the Employee under the group
life insurance and health plans of the AirTouch Group, the Corporation
shall provide the Employee (at its own expense) with the same level of
coverage under individual policies.
(c) Incentive Programs. The period (the "Extension Period") beginning on the
date when the termination of employment is effective and ending on the
earlier of (1) the one-year anniversary of the date when the employment
termination is effective or (2) the date of the Employee's death shall
be counted as employment with the Corporation for purposes of vesting in
each of the incentive awards heretofore or hereafter granted to the
Employee by the members of the AirTouch Group or their delegates, any
contrary provisions of such awards or the applicable plan
notwithstanding. The term "incentive award" shall include, without
limitation, all awards under the AirTouch Communications, Inc. 1993
Long-Term Stock Incentive Plan, all other awards with respect to equity
or derivative securities of the AirTouch Group, and all cash incentive
awards, other than the Team Award. This Subsection shall not be
construed to require any member of the AirTouch Group to grant any new
awards to the Employee during the Extension Period. The parties
understand and agree that the Extension Period also counts as employment
with the Corporation for purposes of determining the expiration date of
any incentive award granted by any member of the AirTouch Group or its
delegate and held by the Employee when employment terminates.
(d) Financial Counseling. For a one-year period after termination of
employment, the Corporation shall provide the Employee with professional
financial counseling services comparable in scope and value to the
financial counseling services made available to the Employee immediately
prior to such termination of employment.
(e) Release of Claims. As a condition to the receipt of the payments and
benefits described in this Section 7, the Employee shall be required to
execute a release of all claims arising out of the Employee's employment
or the termination thereof including, but not limited to, any claim of
discrimination under state or federal law.
(f) No Mitigation. The Employee shall not be required to mitigate the amount
of any payment or benefit contemplated by this Section 7, nor shall any
such payment or benefit be reduced by any earnings or benefits that the
Employee may receive from any other source.
SECTION 8: OTHER TERMINATIONS UNDER THIS PART
If termination of employment, actual or constructive, occurs at a time that is
not within three years after a Change in Control, and the termination is not
described in Section 7,
-7-
8
then the Employee is entitled only to the compensation, benefits and
reimbursements payable under the terms of Sections 3, 4 and 5 of this Agreement
for the period preceding the effective date of the termination. The payments
under this Agreement shall fully discharge all responsibilities of the AirTouch
Group to the Employee upon termination of the Employee's employment. This
Section 8 applies, without limitation, to any termination of employment
initiated by the Employee, termination of employment caused by the Employee's
death or Disability, termination of the Employee for Cause, and any constructive
termination.
-8-
9
THIRD PART: COMPENSATION AND BENEFITS IN CASE OF ACTUAL OR CONSTRUCTIVE
TERMINATION OCCURRING WITHIN THREE YEARS AFTER A CHANGE IN CONTROL
SECTION 9: TERMINATIONS RELATING TO A CHANGE IN CONTROL
This Third Part of the Agreement, consisting of Sections 9 through 12, describes
the benefits and compensation, if any, payable in case of termination of
employment that occurs within three years after a Change in Control (as defined
in Section 12). The Second Part of the Agreement, consisting of Sections 6
through 8, describes benefits and compensation, if any, payable in case of
termination that does not occur within three years after a Change in Control. If
benefits and compensation are payable under this Third Part, then no benefits
and compensation are payable under the Second Part.
SECTION 10: INVOLUNTARY ACTUAL OR CONSTRUCTIVE TERMINATION WITHOUT CAUSE
In the event that, during the term of this Agreement and within three years
after a Change in Control, the Employee's employment terminates in a Qualifying
Termination, as defined in Subsection (a), the Employee shall be entitled to
receive the payments and benefits described in Subsections (b), (c), (d) and
(e).
(a) Qualifying Termination. A Qualifying Termination occurs if:
(1) The Corporation or Employing Entity terminates the Employee's
employment with the AirTouch Group for any reason including,
without limitation, Cause or Disability;
(2) The Employee separates from employment with the AirTouch Group
in response to a "Constructive Termination," which means a
material reduction in salary or benefits, a material change in
responsibilities, or a requirement to relocate, except for
office relocations that would not increase the Employee's
one-way commute distance by more than 40 miles; or
(3) During the term of this Agreement and during the 13th full
calendar month after the occurrence of a Change in Control, the
Employee voluntarily separates from employment with the AirTouch
Group for any reason.
(b) Severance (3x payment). The Corporation shall pay to the Employee in a
lump sum, not less than 31 days nor more than 120 days following the
date of the employment termination, an amount equal to the following:
(1) Three times the Employee's Base Compensation in effect on the
date of the employment termination; plus
-9-
10
(2) 300% of the target Team Award under the AirTouch Communications
Short-Term Incentive Plan, for the Employee's position as of the
date of the termination.
Any other provision of this Agreement or of the AirTouch Communications
Short-Term Incentive Plan notwithstanding, after the amount described in
this Subsection (b) has been paid to the Employee, the Employee shall
have no further interest in such Short-Term Incentive Plan.
(c) Three Years of Life Insurance and Health Plan Coverage. The coverage
described in this Subsection (c) shall be provided for a "Continuation
Period" beginning on the date when the employment termination is
effective and ending on the earlier of (1) the third anniversary of the
date when the employment termination is effective or (2) the date of the
Employee's death. During the Continuation Period, the Employee (and,
where applicable, the Employee's dependents) shall be entitled to
continue participation in the basic and supplemental group term life
insurance plan and in the health care plan for employees maintained by
the Employing Entity as if the Employee were still an employee of the
Employing Entity, but only if the Employee does not elect any
continuation coverage under Part 6 of Title I of the Employee Retirement
Income Security Act of 1974, as amended. Where applicable, the
Employee's compensation for purposes of such plans shall be deemed to be
equal to the Employee's compensation (as defined in such plans) in
effect on the date of the employment termination. To the extent that the
Corporation finds it undesirable to cover the Employee under the group
life insurance and health plans of the AirTouch Group, the Corporation
shall provide the Employee (at its own expense) with the same level of
coverage under individual policies.
(d) Incentive Programs. The period (the "Extension Period") beginning on the
date when the termination of employment is effective and ending on the
earlier of (1) the one-year anniversary of the date when the employment
termination is effective or (2) the date of the Employee's death shall
be counted as employment with the Corporation for purposes of
determining the expiration date of any incentive award granted by any
member of the AirTouch Group or its delegate and held by the Employee
when employment terminates, any contrary provisions of such awards or
the applicable plan notwithstanding. The term "incentive award" shall
include, without limitation, all awards under the AirTouch
Communications, Inc. 1993 Long-Term Stock Incentive Plan, all other
awards with respect to equity or derivative securities of the AirTouch
Group, and all cash incentive awards, other than the Team Award. This
Subsection shall not be construed to require any member of the AirTouch
Group to grant any new awards to the Employee during the Extension
Period.
(e) Financial Counseling. For a one-year period after termination of
employment, the Corporation shall provide the Employee with professional
financial counseling services comparable in scope and value to the
financial counseling services made available to the Employee immediately
prior to the Change in Control.
-10-
11
(f) Penalty for Late or Refused Payment. If the Corporation refuses or fails
to timely pay or provide the compensation and benefits specified in this
Section 10 upon demand as provided in Section 17(c), and if such refusal
or failure is not corrected within 10 business days after the Employee
provides written notice to the Corporation concerning the refusal or
failure, then the Corporation shall pay immediately to the Employee an
additional amount equal to 50% of the Employee's Base Compensation. This
provision shall apply only once.
(g) No Mitigation. The Employee shall not be required to mitigate the amount
of any payment or benefit contemplated by this Section 10, nor shall any
such payment or benefit be reduced by any earnings or benefits that the
Employee may receive from any other source.
SECTION 11: OTHER TERMINATIONS UNDER THIS PART
If termination of employment, actual or constructive, occurs at a time that is
within three years after a Change in Control, and the termination is not
described in Section 10, then the Employee is entitled only to the compensation,
benefits and reimbursements payable under the terms of Sections 3, 4 and 5 of
this Agreement for the period preceding the effective date of the termination.
The payments under this Agreement shall fully discharge all responsibilities of
the AirTouch Group to the Employee upon termination of the Employee's
employment. This Section 11 applies, without limitation, to any termination of
employment initiated by the Employee (except an Employee-initiated termination
that is described in Paragraph (2) or (3) of Section 10(a)), a termination of
employment caused by the Employee's death, or any constructive termination that
does not meet the requirements of a "Constructive Termination" defined in
Paragraph (2) of Section 10(a).
SECTION 12: DEFINITION OF CHANGE IN CONTROL
For all purposes under this Agreement, "Change in Control" shall mean a "Change
in Control" of the Corporation, as defined in the AirTouch Communications, Inc.
1993 Long-Term Stock Incentive Plan (or the successor to such plan).
-11-
12
FOURTH PART: PARACHUTE PAYMENTS
SECTION 13: GROSS-UP PAYMENT.
In the event it is determined that any payment or distribution of any type to or
for the benefit of the Employee, pursuant to this Agreement or otherwise, by the
Corporation or any member of the AirTouch Group, any Person who acquires
ownership or effective control of the Corporation or any member of the AirTouch
Group, or ownership of a substantial portion of the assets of the Corporation or
any member of the AirTouch Group (within the meaning of section 280G of the Code
and the regulations thereunder) or any affiliate of such Person (the "Total
Payments") would be subject to the excise tax imposed by section 4999 of the
Code or any interest or penalties with respect to such excise tax (such excise
tax, together with any such interest and penalties, are collectively referred to
as the "Excise Tax"), then the Employee shall be entitled to receive an
additional payment (a "Gross-Up Payment") in an amount such that, after payment
by the Employee of all taxes (including any interest or penalties imposed with
respect to such taxes), including any Excise Tax, imposed upon the Gross-Up
Payment, the Employee retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Total Payments.
SECTION 14: DETERMINATION BY ACCOUNTANT
All mathematical determinations and determinations as to whether any of the
Total Payments are "parachute payments" (within the meaning of section 280G of
the Code), in each case which determinations are required to be made under this
Section 14, including whether a Gross-Up Payment is required, the amount of such
Gross-Up Payment, and amounts relevant to the last sentence of this Section 14,
shall be made by an independent accounting firm selected by the Employee from
amount the largest six accounting firms in the United States (the "Accounting
Firm"). The Accounting Firm shall provide to the Corporation and to the Employee
its determination (the "Determination"), together with detailed supporting
calculations regarding the amount of any Gross-Up Payment and any other relevant
matter, within five days after termination of the Employee's employment, if
applicable, or at such earlier time as is requested by the Corporation or the
Employee (if the Employee reasonably believes that any of the Total Payments may
be subject to the Excise Tax). If the Accounting Firm determines that no Excise
Tax is payable by the Employee, it shall furnish the Employee with a written
statement that such Accounting Firm has concluded that no Excise Tax is payable
(including the reasons therefor) and that the Employee has substantial authority
not to report any Excise Tax on the Employee's federal income tax return. If a
Gross-Up Payment is determined to be payable, it shall be paid to the Employee
within five days after the Determination is delivered to the Corporation or the
Employee. Any determination by the Accounting Firm shall be binding upon the
Corporation and the Employee, absent manifest error.
As a result of uncertainty in the application of section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments not made by the Corporation and members of the
AirTouch Group should have been made ("Underpayment"), or that Gross-Up Payments
were made by the
-12-
13
Corporation and members of the AirTouch Group that should not have been made
("Overpayments"). In either such event, the Accounting Firm shall determine the
amount of the Underpayment or Overpayment that has occurred. In the case of an
Underpayment, the Corporation promptly shall pay, or cause to be paid, the
amount of such Underpayment to or for the benefit of the Employee. In the case
of an Overpayment, the Employee shall, at the direction and expense of the
Corporation, take such steps as are reasonably necessary (including the filing
of returns and claims for refund), follow reasonable instructions from, and
procedures established by, the Corporation, and otherwise reasonably cooperate
with the Corporation to correct such Overpayment; provided, however, that (1)
Employee shall not in any event be obligated to return to the Corporation an
amount greater than the net after-tax portion of the Overpayment that he has
retained or recovered as a refund from the applicable taxing authorities and (2)
this provision shall be interpreted in a manner consistent with the intent of
Section 13, which is to make the Employee whole, on an after-tax basis, from the
application of the Excise Tax, it being understood that the correction of an
Overpayment may result in the Employee repaying to the Corporation an amount
that is less than the Overpayment.
-13-
14
FIFTH PART: TRADE SECRETS, SUCCESSORS, MISCELLANEOUS PROVISIONS, SIGNATURE PAGE
SECTION 15: CONFIDENTIAL INFORMATION
(a) Acknowledgement. The Corporation and the Employee acknowledge that the
services to be performed by the Employee under this Agreement are unique
and extraordinary and that, as a result of the Employee's employment,
the Employee will be in a relationship of confidence and trust with the
Corporation and will come into possession of "Confidential Information"
(1) owned or controlled by the AirTouch Group, (2) in the possession of
the AirTouch Group and belonging to third parties or (3) conceived,
originated, discovered or developed, in whole or in part, by the
Employee. As used herein "Confidential Information" includes trade
secrets and other confidential or proprietary business, technical,
personnel or financial information, whether or not the Employee's work
product, in written, graphic, oral or other tangible or intangible
forms, including but not limited to specifications, samples, records,
data, computer programs, drawings, diagrams, models, customer names,
business or marketing plans, studies, analyses, projections and reports,
communications by or to attorneys (including attorney-client privileged
communications), memos and other materials prepared by attorneys or
under their direction (including attorney work product), and software
systems and processes. Any information that is not readily available to
the public shall be considered to be a trade secret and confidential and
proprietary, even if it is not specifically marked as such, unless the
Corporation advises the Employee otherwise in writing.
(b) Nondisclosure. The Employee agrees that the Employee will not, without
the prior written consent of the Corporation, directly or indirectly use
or disclose Confidential Information to any person, during or after the
Employee's employment, except as may be necessary in the ordinary course
of performing the Employee's duties under this Agreement. The Employee
will keep the Confidential Information in strictest confidence and
trust. This Section 15 shall apply indefinitely, both during and after
the term of this Agreement.
(c) Surrender Upon Termination. The Employee agrees that in the event of the
termination of the Employee's employment for any reason, the Employee
will immediately deliver to the Corporation (and/or other members of the
AirTouch Group, as applicable) all property belonging to the AirTouch
Group, including all documents and materials of any nature pertaining to
the Employee's work with the AirTouch Group, and will not take with the
Employee any documents or materials of any description, or any
reproduction thereof of any description, containing or pertaining to any
Confidential Information. It is understood that the Employee is free to
use information that is in the public domain (not as a result of a
breach of this Agreement).
-14-
15
SECTION 16: SUCCESSORS
(a) Corporation's Successors. The Corporation shall require any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of
the Corporation's business and/or assets, by an agreement in substance
and form satisfactory to the Employee, to assume this Agreement and to
agree expressly to perform this Agreement in the same manner and to the
same extent as the Corporation would be required to perform it in the
absence of a succession. The Corporation's failure to obtain such
agreement prior to the effectiveness of a succession shall be a breach
of this Agreement and shall entitle the Employee to all of the
compensation and benefits to which the Employee would have been entitled
hereunder if the Corporation had involuntarily terminated the Employee's
employment without Cause or Disability, on the date when such succession
becomes effective.
(b) Employee's Successors. This Agreement and all rights of the Employee
hereunder shall inure to the benefit of, and be enforceable by, the
Employee's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.
SECTION 17: MISCELLANEOUS PROVISIONS
(a) Waiver. No provision of this Agreement shall be modified, waived or
discharged unless the modification, waiver or discharge is agreed to in
writing and signed by the Employee and by an authorized officer of the
Corporation (other than the Employee). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this
Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another
time.
(b) Whole Agreement. No agreements, representations or understandings
(whether oral or written and whether express or implied) that are not
expressly set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof. In addition, the
Employee hereby acknowledges and agrees that this Agreement supersedes
in its entirety any employment agreement between the Employee and the
Corporation in effect immediately prior to the effective date of this
Agreement. As of the effective date of this Agreement, such employment
agreement shall terminate without any further obligation by either party
thereto, and the Employee hereby relinquishes any further rights that
the Employee may have had under such prior employment agreement.
(c) Presumption. Subject to the provisions of Section 13, the Corporation
shall make or cause to be made a payment described in this Agreement
upon receiving written notice from the Employee describing such payment,
referring to the provision of this Agreement under which such payment is
claimed and certifying that all conditions for such payment, as set
forth in this Agreement, have been satisfied. The information so
furnished to the Corporation by the
-15-
16
Employee shall be presumed to be correct, subject to rebuttal by the
Corporation after payment. After making the payment claimed by the
Employee, the Corporation may seek a refund of such payment in
accordance with Subsection (h) below. This Subsection (c) shall not be
used to cause a payment to be made at a time earlier than provided in
this Agreement.
(d) Notice. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly
given when personally delivered or when mailed by U.S. registered or
certified mail, return receipt requested and postage prepaid. In the
case of the Employee, mailed notices shall be addressed to the Employee
at the home address that the Employee most recently communicated to the
Corporation in writing. In the case of the Corporation, mailed notices
shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.
(e) No Setoff. There shall be no right of setoff or counterclaim, with
respect to any claim, debt or obligation, against payments to the
Employee under this Agreement.
(f) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State
of California, irrespective of California's choice-of-law principles.
(g) Severability. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full
force and effect.
(h) Arbitration. Except as otherwise provided in Section 13, any dispute or
controversy arising out of the Employee's employment or the termination
thereof, including, but not limited to, any claim of discrimination
under state or federal law, shall be settled exclusively by arbitration
in San Francisco, California, in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered
on the arbitrator's award in any court having jurisdiction. The
foregoing notwithstanding, a dispute or controversy over whether Cause
exists for the termination of an Employee, whether such termination
occurred within three years after a Change in Control, or a dispute or
controversy over whether a Constructive Termination has occurred, shall
be arbitrated by a three-member panel of the outside directors of the
Corporation, with the selection of the panel to be made by the Chairman,
as of one year prior to the Change in Control, of the Corporation's
Board of Directors. If three such individuals are unwilling to serve as
arbitrators, the preceding sentence shall be inapplicable, and all
disputes and controversies shall be subject to arbitration in accordance
with the rules of the American Arbitration Association, as provided
above in this Subsection. For purposes of this Subsection, "outside
directors" shall mean members of the Board of Directors of the
Corporation, as such Board of Directors was constituted one year prior
to the Change in Control, who were not employees of the Corporation or
another member of the AirTouch Group one year prior to the Change in
Control.
-16-
17
(i) No Assignment of Benefits. The rights of any person to payments or
benefits under this Agreement shall not be made subject to option or
assignment, either by voluntary or involuntary assignment or by
operation of law, including (without limitation) bankruptcy,
garnishment, attachment or other creditor's process, and any action in
violation of this Subsection (i) shall be void.
(j) Employment at Will; Limitation of Remedies. The Corporation and the
Employee acknowledge that the Employee's employment is at will, as
defined under applicable law. If the Employee's employment terminates
for any reason, the Employee shall not be entitled to any payments,
benefits, damages, awards or compensation other than as provided by this
Agreement.
(k) Employment Taxes. All payments made pursuant to this Agreement shall be
subject to withholding of applicable taxes.
(l) Benefit Coverage Non-Additive. In the event that the Employee is
entitled to life insurance and health plan coverage under more than one
provision hereunder, only one provision shall apply, and neither the
periods of coverage nor the amounts of benefits shall be additive.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Corporation by its duly authorized officer, as of the day and year first
above written.
--------------------------------
Xxx Xxxx
AIRTOUCH COMMUNICATIONS, INC.
By _____________________________
Xxxx X. Riding
Its Vice President, Human Resources
and Corporate Services
-17-
