Exhibit 10.92
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement (this "Agreement") is
made and entered into as of this 9th day of January, 1997, by and between
Hungarian Telephone and Cable Corp., a corporation organized under the laws of
the State of Delaware, United States of America (the "Company") and Xxxxxxx X.
Xxxxx ("Executive").
RECITALS:
A. The Company and Executive are parties to that certain Employment
Agreement, dated December 19, 1995 ("1995 Agreement").
B. On July 26, 1996, Executive's position with the Company was changed
from that of Assistant Controller to that of Controller, thereby significantly
increasing Executive's duties and responsibilities.
C. The parties desire to amend and restate the 1995 Agreement to set
forth the terms and conditions under which Executive shall continue to serve in
the above-stated capacity of Controller of the Company.
NOW, THEREFORE, in consideration of the respective covenants and
agreements of the parties set forth herein, it is agreed as follows:
1. Employment and Duties. The Company agrees to employ Executive and
Executive accepts the employment, subject to the terms and conditions herein, to
serve as Controller of the Company. Executive shall report and be responsible
solely to the President and Chief Executive Officer of the Company. Executive's
duties and responsibilities shall include the duties and responsibilities as set
forth in the Company's bylaws from time to time in effect and such other duties
and responsibilities as the President and Chief Executive Officer may from time
to time reasonably assign Executive, in all cases consistent with Executive's
position. Executive shall perform faithfully the executive duties assigned to
him to the best of his ability.
2. Place of Employment. Executive shall be employed at the Company's
offices located at Xxxxxxxxxx x.0, Xxxxxxxx, Xxxxxxx.
3. Term. The term of employment under this Agreement shall continue
through December 31, 1999, unless earlier terminated in accordance with the
terms of this Agreement (the "Employment Period").
4. Effective Date. The effective date of this Agreement is July 26,
1996, the date on which Executive was elected Controller by the Board of
Directors of the Company (the "Board").
5. Annual Salary. Executive will receive an annual base salary of One
Hundred Forty Thousand Dollars ($140,000), payable in equal monthly installments
on the last day of each month. The Company shall be entitled to deduct or
withhold all taxes and charges which the Company may be required by law to
deduct or withhold therefrom. The Compensation and Stock Option Committee of the
Board (the "Compensation Committee") shall annually review Executive's base
salary in light of the performance of Executive and, if it finds Executive's
performance to be satisfactory, the Compensation Committee shall increase such
base salary by an amount it determines to be appropriate, but in no event shall
such increase be less than the annual change in the United States Consumer Price
Index for the most recently reported twelve (12) month period.
-1-
6. Share Award. In consideration of the Executive's (i) past services
to the Company and (ii) delivery of the aggregate par value therefor, the
Company hereby sells and assigns Executive five thousand (5,000) shares (the
"Shares") of the Company's common stock, par value $.001, ("Common Stock"),
which will be registered with the United States Securities and Exchange
Commission (the "Commission") on Form S-8. Executive's rights to the Shares will
vest and certificates evidencing ownership of the Shares will be released
according to the following schedule, provided that if Executive has not
maintained continuous service with the Company from the date hereof until the
related vesting date (other than in circumstances set forth in Paragraphs 17(b)
and (c)) all as yet unvested Shares shall be forfeited and cancelled, so no
certificate(s) therefor shall be released to the Executive:
Release Date Shares released
October 10, 1997 5,000
Prior to the scheduled release date of any installment of Shares, such
unreleased Shares may not be sold, assigned, transferred, pledged, or otherwise
encumbered by Executive. Executive hereby grants the Company an option to
purchase such number of Shares released to Executive as shall be sufficient to
allow Executive to pay taxes due on the released Shares, provided such purchase
by the Company does not violate the Company's certificate of incorporation, its
bylaws or the Delaware General Corporation Law.
7. Annual Stock Options. Executive shall be entitled to receive an
award of options to purchase a target of fifteen thousand (15,000) shares of
Common Stock annually (the "Options") starting in 1997.
For the years 1997 through 1999, Executive will be entitled to
participate in the Company's 1992 Incentive Stock Option Plan, as amended (the
"ISO Plan"). Under the ISO Plan, Executive shall be entitled to receive an award
of options to purchase a target of fifteen thousand (15,000) shares of Common
Stock annually on terms to be established by the Compensation Committee. The
Compensation Committee shall establish such terms, including exercise price, by
March 31st of the year following the year in which such Options are
attributable. In any given year, Executive may receive an award that is less
than, equal to, or greater than the target award, depending upon the Company's
performance measured against annual financial targets agreed to by and between
Executive and the Compensation Committee.
8. Annual Housing Allowance. Executive will receive an annual housing
allowance (the "Housing Allowance") of Thirty-Six Thousand Dollars ($36,000),
payable in equal monthly installments. The Compensation Committee shall review
the amount of the Housing Allowance on an annual basis, and may increase the
amount based on cost of living increases, if applicable.
9. Insurance. The Company will provide Executive, his spouse and his
minor dependents with health insurance coverage under a fully comprehensive
international scheme.
10. Automobile. The Company will provide Executive with an automobile
to be leased or purchased and maintained by the Company.
11. Annual Leave. Executive will be entitled to thirty (30) days annual
paid vacation and a home leave allowance of Five Thousand Dollars ($5,000).
12. Hungarian Taxes. The Company will reimburse Executive for all
Hungarian taxes, work permits, or other governmental assessments that relate to
his employment by the Company.
-2-
13. Covenant Not to Compete. Executive hereby agrees that during the
term of this Agreement, he will not, either through any kind of ownership (other
than ownership of securities of a publicly held corporation of which Executive
owns less than five percent (5%) of any class of outstanding securities), or as
a director, officer, principal, agent, employee, employer, advisor, consultant,
co-partner, or in any individual or representative capacity whatever, either for
his own benefit or for the benefit of any other person, firm, or corporation,
without the prior written consent of a duly authorized officer of the Company,
compete with the Company by engaging in any act, including, but not limited to,
any of the following: (a) canvass, solicit, accept, or perform any type of work
performed by the Company for any "customer" (as hereinafter defined) of the
Company; (b) develop, design, market any services that may be sold by the
Company during the term of this Agreement; (c) request or advise any firm to
withdraw, curtail, or cancel its business with the Company; (d) give or attempt
to give any person, partnership, or corporation the right to solicit or canvass
any customer for the performance of services provided by the Company; and (e)
induce or attempt to influence any employee of the Company or any employee of
any customer to terminate his employment with the view toward competing with the
Company or any customer. As used herein, the term "customer" includes any of the
Company customers at any time during the term of this Agreement.
14. Confidential Information.
(a) Nondisclosure. Executive expressly covenants and agrees
that he will not during the term of this Agreement or at any time after
the termination hereof, irrespective of the time, manner, or cause of
termination, reveal, divulge, disclose, or communicate to any person,
firm, or corporation, other than authorized officers, directors, and
employees of the Company, in any manner whatsoever, any "confidential
information" (as hereinafter defined) of the Company that would be
inconsistent with the position held by Executive or the duties being
performed by Executive at the direction of the Company.
(b) Return of Confidential Information and Other Property. Upon
termination of this Agreement, Executive will surrender to the Company
all confidential information including, without limitation, all lists,
charts, schedules, reports, financial statements, books and records,
and all copies thereof, of the Company and all other property belonging
to the Company whatsoever. As used herein, "confidential information"
means information disclosed to or known by Executive as a consequence
of or through his employment for the Company, not generally known in
the business in which the Company is or may become engaged, about the
Company, its business, products and processes.
15. Breach of Covenant Not to Compete and Confidentiality Provision.
Executive agrees that a substantial violation on his part of any covenant
contained in Paragraphs 13 and 14 above will cause such damage to the Company as
will be irreparable and for that reason, Executive further agrees that the
Company shall be entitled as a matter of right, to an injunction out of any
court of competent jurisdiction, restraining any further violation of said
covenants by Executive, his employer, employees, partners, or agents. Such right
to injunction shall be cumulative and in addition to whatever other remedies the
Company may have, including, specifically, recovery of liquidated and additional
damages. Executive expressly acknowledges and agrees that the respective
covenants and agreements shall be construed in such a manner as to be
enforceable under applicable laws if a more limited scope of time is determined
by a court or competent jurisdiction to be required.
16. Indemnification. The Company agrees that if Executive is made a
party, or is threatened to be made a party, to any action, suit or proceeding,
whether civil, criminal, administrative or investigative (a "Proceeding"), by
reason of the fact that he is or was a director, officer or employee of the
Company, Executive shall be indemnified and held harmless by the Company to the
fullest extent legally permitted or authorized by the Company's certificate of
incorporation or bylaws or resolutions of the Board or, if greater, by the laws
of the State of Delaware, against all cost, expense, liability and loss
(including, without limitation, attorney's fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by Executive in connection therewith. The Company agrees to
continue and maintain a directors' and officers' liability insurance policy
covering Executive to the extent the Company provides such coverage for any of
its other executive officers.
-3-
17. Termination.
(a) Reasons for Termination. The employment of Executive with
the Company shall terminate automatically upon Executive's death and
may be terminated by written notice (i) by the Company, upon
Executive's disability which renders him unable to perform his usual
and customary duties for a period of 180 consecutive days; (ii) by the
Company, with or without "cause" (as hereinafter defined); (iii) by
Executive, if he suffers a demotion or a lower status with the Company
other than for cause; or (iv) by Executive, in the event of a "change
in control" (as hereinafter defined), whether or not Executive suffers
a demotion or a lower status with the Company. For purposes of this
Agreement, "cause" shall mean (i) a failure by Executive to
substantially perform Executive's reasonable and legal duties and as
defined by goals established by the Board and agreed to by Executive,
other than a failure resulting from Executive's complete or partial
incapacity due to physical or mental illness or impairment, (ii)a
willful act by Executive that constitutes gross misconduct and that is
injurious to the Company, (iii) a willful breach by Executive of a
material provision of this Agreement, or (iv) a material and willful
violation of a federal or state law or regulation applicable to
the business of the Company. No act, or failure to act, by Executive
shall be considered "willful" unless committed without good faith and
without a reasonable belief that the act or omission was in the
Company's best interest. For purposes of this Agreement, a "change
of control" shall be deemed to have occurred if (1) any "person" (as
such term is used in Sections 13(d) and 14(d)of the U.S. Securities and
Exchange Act (the "Exchange Act")), other than Citizens Utilities
Company or its affiliates (together, "Citizens"), is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing
thirty-five percent (35%) or more of the combined voting power (with
respect to the election of directors) of the Company's then outstanding
securities; (2) at any time after the execution of this Agreement, a
majority of the Board shall be replaced, over a two-year period, from
the directors who constituted the Board at the beginning of such
period, and such replacement shall not have been approved by either
two-thirds (2/3) of the Board as constituted at the beginning of such
period or Citizens; (3) the consummation of a merger or consolidation
of the Company with or into any other corporation (other than
Citizens), other than a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) more
than sixty-five percent (65%) of the combined voting power (with
respect to the election of directors) of the securities of the Company
or of such surviving entity outstanding immediately after such merger
or consolidation; or (4) the consummation of a plan of complete
liquidation of the Company or of an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
business or assets.
(b) Termination Benefits. If Executive's employment is
terminated prior to the expiration of the term of this Agreement, for
any reason noted above (other than for "cause"), Executive will be
entitled to receive the following benefits as severance (the "Severance
Benefits"):
(i) a lump sum payment equal to nine (9) months'
salary and nine (9) months' Housing Allowance at
Executive's then-current annual salary and Housing
Allowance levels;
(ii) payment of any salary, expenses, allowances and
benefits accrued by Executive up to the date of the
termination;
-4-
(iii) the immediate vesting and release of any
unvested unreleased portion of the shares of Common
Stock granted hereunder, without restriction; and
(iv) a pro-rata share of stock options, if any, that
are awardable under any incentive stock option plan
(in addition to the ISO Plan) established by the
Company.
(c) Benefits in the Event of Executive's Death. Except as set
forth below, if Executive's employment terminates automatically in the
event of Executive's death, Executive's estate will be entitled to
receive the Severance Benefits. The Company may, at its option,
maintain a life insurance policy for Executive in an amount deemed to
be appropriate by the Board and designating Executive's estate as the
beneficiary. If the Company elects to maintain such life insurance and
the policy amount equals or exceeds the value of the Severance Benefits
(as determined by the Board), Executive's estate shall only be entitled
to receive the proceeds of the insurance policy. If the policy amount
is less than the value of the Severance Benefits, the Company shall pay
to Executive's estate an amount equal to the difference between the
value of the Severance Benefits and the amount to which the estate
would be entitled under the insurance policy. The Company shall
determine the value of the Severance Benefits as soon as practicable
after Executive's death but in no event later than thirty (30) days
thereafter.
(d) Date of Termination; Provision of Severance Benefits. The
date of termination of Executive's employment by the Company under this
Paragraph 17 shall be one (1) month after receipt by Executive of
written notice of termination, provided, however, that if the
termination is for cause the date of termination shall be the date
specified in the notice of termination or if no date is specified then
the date on which such notice is received by the Executive. The date of
termination by Executive under this Paragraph 17 shall be one (1) month
after receipt by the Company of written notice of termination. All
benefits to which Executive is entitled under subparagraph (b) hereof
shall be provided on the date of termination. In the case of automatic
termination in the event of Executive's death, the benefits shall be
provided no later than thirty (30) days from the date of Executive's
death.
18. Miscellaneous.
(a) Rights Under Plans and Programs. Notwithstanding anything
in this Agreement to the contrary no provision of this Agreement is
intended, nor shall it be construed, to reduce or in any way restrict
any benefit to which Executive may be entitled under any agreement,
plan, arrangement, or program providing benefits for Executive.
(b) Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter of
this Agreement and supersedes all prior written and oral and all
contemporaneous oral agreements and understandings with respect to the
subject matter of this Agreement.
(c) Notices. Any notice or request to be given hereunder by
any party to the other shall be in writing and shall be deemed to have
been duly given on the next business day after the same is sent, if
delivered personally or sent by telecopy or overnight delivery, or five
calendar days after the same is sent, if sent by registered or
-5-
certified mail, return receipt requested, postage prepaid, as set forth
below, or to such other persons or addresses as may be designated in
writing in accordance with the terms hereof by the party to receive
such notice.
If to the Company, to:
Hungarian Telephone and Cable Corp.
000 Xxxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Facsimile No.: 203/348-9128
Attn: General Counsel
with a required copy to:
Xxxxxxxxxx and Xxxxx, L.L.P.
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile No.: 202/745-0916
Attn: Xxxxxx X. Xxxxxx
If to Executive, to:
the address or facsimile number
for Executive as set forth
in the Company's records
with a required copy to:
Xxxxxxxxx and Xxxxxxx
0000 Xxxxxxxxxxxx Xxx., X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile No.: 202/622-6291
Attn: Xxxx Xxxxxx, Esq.
(d) Governing Law; Forum; Consent to Jurisdiction. This
Agreement shall be governed by and construed in accordance with the
laws of the State of New York without giving effect to the principles
of conflict of laws thereof. Each of the parties to this Agreement
hereby irrevocably and unconditionally (i) consents to submit to the
exclusive jurisdiction of the courts of the State of New York for any
proceeding arising in connection with this Agreement (and each such
party agrees not to commence any such proceeding, except in such
courts), (ii) to the extent such party is not a resident of the State
of New York, agrees to appoint an agent in the State of New York as
such party's agent for acceptance of legal process in any such
proceeding against such party with the same legal force and validity as
if served upon such party personally within the State of New York, and
to notify promptly each other party hereto of the name and address of
such agent, (iii) waives any objection to the laying of venue of any
such proceeding in the courts of the State of New York, and (iv)
waives, and agrees not to plead or to make, any claim that any such
-6-
proceeding brought in any court of the State of New York has been
brought in an improper or otherwise inconvenient forum.
(e) Counterparts. This Agreement may be executed in one or
more counterparts, and each of such counterparts shall for all purposes
be deemed to be an original, but all such counterparts together shall
constitute but one instrument.
(f) Executive's Successors. This Agreement and all rights of
Executive hereunder shall inure to the benefit of, and be enforceable
by, Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
(g) Assignment. Neither this Agreement, nor the rights and
obligations hereunder, may be assigned by either party without the
prior written consent of the other party.
(h) Parties in Interest. Nothing in this Agreement, expressed
or implied, is intended to confer on any person other than the parties
hereto or their respective successors or assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
(i) Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties.
(j) Extension; Waiver. Either party to this Agreement may (a)
extend the time for the performance of any of the obligations or other
acts of the other party to this Agreement or (b) waive compliance by
the other party with any of the agreements or conditions contained
herein or any breach thereof. Any agreement on the part of a party to
any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
(k) Severability. The provisions of this Agreement are
severable and, if any provision of this Agreement is determined to be
invalid or unenforceable by any court of competent jurisdiction, such
provision (in any other jurisdiction) and the other provisions hereof
(in any jurisdiction) shall not be rendered otherwise invalid or
unenforceable and such provision shall be deemed to be modified to the
extent necessary to render it legal, valid and enforceable, and if no
such modification shall render it legal, valid and enforceable, then
this Agreement shall be construed as if not containing the provision
held to be invalid, and the rights and obligations of the parties shall
be construed and enforced accordingly.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
HUNGARIAN TELEPHONE AND CABLE CORP.
By: /s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
XXXXXXX X. XXXXX
/s/ Xxxxxxx X. Xxxxx
-7-
