EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of August 14, 1998, by and between RSL
COM Europe, Ltd., a company organized in England (the "Company"), and Xxxxxxx
X. Xxxxxxxx ("Executive").
W I T N E S S E T H:
WHEREAS, the Company and Executive are parties to an Employment
Agreement, dated as of August 5, 1995 for a term of three years which
commenced August 14,1995 and expired August 13, 1998;
WHEREAS, the Company desires to enter into a new agreement, effective
August 14, 1998 (the "Commencement Date") to set out the terms and conditions
of Executive's employment by the Company from and after the Commencement Date;
and
WHEREAS, the Executive desires to continue in the employment of the
Company from and after the Commencement Date under those terms and conditions;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the Company and Executive hereby agree as follows:
1. Employment.
(a) Agreement to Employ. Upon the terms and subject to the conditions
of this Agreement, the Company hereby employs Executive, and Executive hereby
accepts continued employment by the Company.
(b) Term of Employment. The Company shall employ Executive for a term
(the "Term") commencing on the Commencement Date and ending August 31, 2001,
unless extended by a written agreement signed by both parties. The period
commencing on the Commencement Date and ending on the earlier of (i) the
expiration of the Term, or (ii) the date of Executive's termination of
employment pursuant to Section 5(a) shall be referred to as the "Employment
Period". If the Employment Period or any extension
thereof expires without being renewed, the Executive agrees not to bring any
claim for a redundancy payment or for unfair dismissal.
2. Position and Duties.
(a) In general. Executive shall be employed as President and Chief
Executive Officer of the Company and shall perform such duties and services,
consistent with such position for the Company, as may be assigned to him from
time to time by the Board of Directors of the Company (the "Board") and such
officer of RSL Communications Ltd. ("RSL Com") as is designated by the Board.
The duties of the Executive shall include serving as an officer or director or
otherwise performing services for any "Affiliate" of the Company as requested
by the Company. An "Affiliate" of the Company means any entity that controls,
is controlled by or is under common control with the Company. Executive shall
report to the Board of Directors and such officer of RSL Com as is designated
by the Board. Executive's principal office shall be located in the London,
England metropolitan area.
(b) Full-time employment. During the Employment Period, Executive
shall devote his full business time to the services required of him hereunder,
except for time devoted to services required by him to be performed for any
"Affiliate" of the Company, vacation time and reasonable periods of absence
due to sickness, personal injury or other disability, and shall use his best
efforts, judgement, skill and energy to perform such services in a manner
consonant with the duties of his position and to improve and advance the
business and interests of the Company. Executive shall not be engaged in any
other business activity which, in the reasonable judgment of the Board,
conflicts with the duties of the Executive under this Agreement. Executive
shall travel to such location or locations as may be requested by the Company,
or which Executive believes is necessary or advisable, in the performance by
Executive of his duties hereunder or to the extent appropriate to improve and
advance the interests of the Company and its Affiliates. There is no formal
disciplinary procedure, but Executive is expected at all times to behave in a
manner befitting his employment.
3. Compensation.
(a) Base Salary. During the Employment Period, the Company shall pay
Executive a base salary at the annual rate of 238,000 pounds sterling;
provided that, Executive's annual base salary shall be increased as of
September 1 of each year, commencing September 1, 1999, by an amount equal to
the base salary then in effect, multiplied by the percentage increase in the
Cost of Living Index during the preceding year. The "Cost of Living Index"
means the Retail Prices Index for the London metropolitan area published by
the Office of National Statistics for the preceding 12
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month period, or if such index is no longer available, such other generally
available index measuring changes in consumer purchasing power in the London
metropolitan area or nationally) designated by the Board of Directors. Any
delay in increase in Executive's annual base salary by reason of the
unavailability of any such index at the time any such increase shall otherwise
be due shall be made up by a lump sum payment promptly after the index becomes
available. Executive's salary, as adjusted for any increase in the Cost of
Living Index, may be further increased at the option and in the discretion of
the Board of Directors (such salary, as the same may be increased from time to
time, is referred to herein as the "Base Salary"). The Base Salary shall be
payable in such installments (but not less frequent than monthly) as the
salaries of other executives of the Company are paid.
(b) Bonus Opportunity. Executive shall be eligible to receive an
annual bonus of up to 40% of his Base Salary based on acceptable performance
as determined by the Chief Executive Officer of RSL Com and as approved by the
Compensation Committee of`the Board of Directors of RSL Com (although the
bonus could be higher if the performance of the Company exceeded established
targets). Executive's bonus for 1998 will be prorated on the basis of his Base
Salary as in effect before and from August 14, 1998.
(c) Equity Participation. RSL Com, by action of the Compensation
Committee, shall grant Executive an option (the "Option") to purchase 216,428
shares of the Class A Common Shares of RSL Com at the greater of $22.00 per
share and the Fair Market Value of a share, as defined in the RSL
Communications Ltd. 1997 Stock Incentive Plan, on the date of grant. The
Option shall become exercisable as set forth below, provided Executive is
employed by the Company on such date, and once exercisable shall, except as
otherwise provided below, remain exercisable until the expiration of seven
years from the date of grant. However, the Option shall be immediately
terminated upon a termination of Executive's employment by the Company for
Cause (as hereinafter defined). If the initial exercise price of the Option
exceeds $22.00, the Company shall provide Executive an additional award of
options, restricted stock or other form of equity award so that the total
value of Executive's Option and such other equity award shall be equivalent to
the grant of an option on 216,428 shares at $22.00 per share.
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Date First Exercisable Percentage Exercisable
---------------------- ----------------------
August 31, 1999 33 1/3%
August 31, 2000 66 2/3%
August 31, 2001 100%
The Option shall become immediately exercisable in full in the event
that Executive's employment with the Company is terminated: (i) by the Company
other than for Cause, (ii) by Executive for Good Reason or (iii) by reason of
the death or Disability of the Executive. Additionally, the Option shall
become immediately exercisable in full upon a Change in Control. The Option
shall, following any termination of Executive's employment (other than for
Cause), remain exercisable for the lesser of two years and the remaining term
of the Option.
4. Benefits, Perquisites and Expenses.
(a) Benefits. During the Employment Period:
(i) the Company shall continue to provide Executive and his family
with full private medical coverage with BUPA or other similar
company, subject to acceptance by that company.
(ii) the Company will arrange and pay for life assurance on the life
of Executive in the value of four times his Base Salary for the
benefit of Executive's family, subject to Executive's insurability.
(iii) the Company will provide Executive with an annual car allowance
of (pound)10,000. Executive may at his option use his own car or have
the Company provide a leased car or contract hire car. In addition to
the car allowance, the Company will also pay for insurance together
with personal and business petrol costs. The Executive shall be
liable for any personal taxes levied for use of the car, shall take
good care of the car and will be responsible for ensuring that it
remains, at all times, in road-worthy condition.
(iv) the Executive will belong to a suitable Personal Pension Scheme
nominated by Executive and approved by the Board of Inland Revenue of
the United Kingdom. The Executive's pension entitlement shall be
12.5% of Executive's Base Salary.
Executive shall be eligible to participate in (i) each welfare benefit plan
sponsored or maintained by the Company, including, without limitation, each
group life, hospi-
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talization, medical, dental, health, accident or disability insurance or
similar plan or program of the Company, and (ii) each pension, profit sharing,
retirement, deferred compensation or savings plan sponsored or maintained by
the Company, in each case, whether now existing or established hereafter, to
the extent that Executive is eligible to participate in any such plan under
the generally applicable provisions thereof, provided that Executive shall not
participate in any such plan if such coverage would be additive or duplicative
to the benefits Executive is provided pursuant to clauses (i), (ii) or (iv)
above.
(b) Perquisites. During the Employment Period, Executive shall be
entitled to five weeks' paid vacation annually and shall also be entitled to
receive such perquisites as are generally provided to other senior officers of
the Company in accordance with the then current policies and practices of the
Company, provided that Executive shall not receive any other benefit relating
to automobiles other than is provided pursuant to clause (iii) of section 4(a)
above.
(c) Business Expenses. During the Employment Period, the Company
shall pay or reimburse Executive for all reasonable expenses incurred or paid
by Executive in the performance of Executive's duties hereunder, upon
presentation of expense statements or vouchers and such other information as
the Company may require and in accordance with the generally applicable
policies and procedures of the Company.
(d) Indemnification. The Company shall indemnify Executive and hold
Executive harmless from and against any claim, loss or cause of action arising
from or out of Executive's performance as an officer, director or employee of
the Company or any of its subsidiaries or affiliates or in any other capacity,
including any fiduciary capacity, in which Executive serves at the request of
the Company to the maximum extent permitted by applicable law and the
Company's Memorandum of Association and Bye-Laws in effect on the date hereof.
5. Termination of Employment.
(a) Termination of the Employment Period. The Employment Period shall
end upon the earliest to occur of (i) a termination of Executive's employment
on account of Executive's death, (ii) a Termination due to Disability or
Retirement, (iii) a Termination for Cause, (iv) a Termination Without Cause,
(v) a Termination by Executive for Good Reason, (vi) a Termination by
Executive other than for Good Reason, or (vii) the expiration of the Term. The
Company or the Executive may initiate a termination in any manner permitted
hereunder by giving the other party written notice thereof (the "Termination
Notice"). The effective date (the "Termination Date") of any termination shall
be deemed to be the later of (i) in the case of a Termination Notice from
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Executive, 45 days after the receipt by the Company of the Termination Notice,
(ii) the date on which the Termination Notice is given, or (iii) the date
specified in the Termination Notice; provided, however, that in the case of
the Executive's death, the Termination Date shall be the date of death. Upon
termination of his employment for any reason, Executive will immediately
resign from all positions that he holds with the Company and its Affiliates
without any claim for compensation and, should Executive fail to tender his
resignation within two days of the request, the Company is irrevocably
authorized to appoint an agent in his name and on his behalf to sign any
documents and do anything necessary or desirable to give effect to his
resignation.
(b) Payments Upon Certain Terminations.
(i) Termination Without Cause or Termination by Executive for Good
Reason. In the event that Executive's employment is terminated by the Company
Without Cause or by the Executive for Good Reason, the Company shall pay
Executive his Earned Salary, Vested Benefits and a Severance Benefit (as such
terms are hereinafter defined). In addition, if Executive's employment
terminates pursuant to this subsection (i), the Company shall continue to
provide to Executive the welfare benefits (other than disability insurance)
referred to in Section 4, or substantially comparable benefits, until the
earlier of (x) the date on which Executive is eligible to obtain comparable
benefits from other employment or (y) the expiration of the Term.
(ii) Termination due to Death. In the event of the termination of
Executive's employment due to Executive's death, the Company shall pay
Executive's estate Executive's Earned Salary, Vested Benefits and a lump sum
payment equal to 12 months of Executive's Base Salary (at the rate in effect
on the date of his death).
(iii) Termination due to Disability or Retirement. In the event of
termination of Executive's employment by the Company due to Disability or a
Termination due to Retirement, the Company shall pay Executive his Earned
Salary and Vested Benefits, plus, in the event of termination due to
Disability, to the Executive or his estate his Base Salary at the Termination
Date on a monthly basis for 12 months following the month in which Executive's
employment is terminated. In the event that Executive's employment with the
Company is terminated due to Disability, Executive's benefits under this
subsection (iii) shall be reduced by the amount of any Company sponsored (and
paid for) disability benefits paid to Executive. The payments to be made to
Executive during the period of disability prior to termination are intended to
comply with the Disability Discrimination Act.
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(iv) Termination by Executive other than for Good Reason. In the
event of a Termination by Executive other than for Good Reason, the Company
shall pay Executive his Earned Salary and Vested Benefits.
(v) Termination for Cause. In the event of a termination of
Executive's employment by the Company for Cause, the Company shall pay
Executive his Earned Salary and Vested Benefits.
(c) Timing of Payments. Earned Salary shall be paid in a single lump
sum as soon as practicable, but in no event later than the earlier of 60 days
following the end of the Employment Period or the day such Earned Salary would
have been payable under the Company's normal payroll practices. Vested
Benefits shall be payable in accordance with the terms of the plan, policy,
practice, program, contract or agreement under which such benefits have
accrued except as otherwise expressly modified by this Agreement. Fifty
percent (50%) of Severance Benefits shall be paid within 30 days after the
Termination Date and the remaining 50% of the Severance Benefits shall be paid
in equal monthly installments during the eleven month period following the
payment of the first 50% of Severance Benefits.
(d) Retention of monies owed. The Company may at any time during
Executive's employment or upon its termination for any reason deduct and
retain from any monies owed by it to Executive any sum properly paid by it or
any Affiliate to, on behalf or at the request of Executive or due to it from
Executive including, but not limited to, unauthorized expenses or excess
vacation.
(e) Definitions. The following capitalized terms have the following
meanings:
"Earned Salary" means any Base Salary earned, but unpaid, for
services rendered to the Company on or prior to the date on which the
Employment Period ends.
"Normal Retirement Age" means the first day of the month following
Executive attaining age 65.
"Severance Benefit" means an amount equal to Executive's annual Base
Salary as in effect immediately prior to the Termination Date.
"Termination due to Disability" means a termination of Executive's
employment by the Company because Executive has been incapable of
substantially fulfilling the positions, duties, responsibilities and
obligations set forth in this Agreement because of physical, mental or
emotional incapacity resulting from injury, sickness or
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disease for a period of (i) at least six consecutive months or (ii) more than
nine months in any twelve month period. Any question as to the existence,
extent or potentiality of Executive's disability upon which Executive and the
Company cannot agree shall be determined by a qualified, independent physician
selected by the Company and reasonably acceptable to Executive. The
determination of any such physician shall be final and conclusive for all
purposes of this Agreement. Executive or his legal representative or any adult
member of his immediate family shall have the right to present to such
physician such information and arguments as to Executive's disability as he,
she or they deem appropriate, including the opinion of Executive's personal
physician.
"Termination due to Retirement" means termination of employment by
Executive other than for Good Reason, or termination of Executive's employment
by the Company other than a Termination for Cause, on or after Executive's
Normal Retirement Age.
"Termination for Cause" means a termination of Executive's employment
by the Company with immediate effect and without any claim for compensation or
damages due to (i) Executive's conviction of a felony or the entering by
Executive of a plea of nolo contendere with respect to a charged felony, (ii)
Executive's gross negligence, recklessness, dishonesty, fraud, willful
malfeasance or willful misconduct in the performance of the services
contemplated by this Agreement, (iii) a willful failure without reasonable
justification to comply with a reasonable written order of the Board of
Directors or the officer of RSL Com to whom Executive reports; (iv) a willful
and material breach of Executive's duties or obligations under this Agreement;
or (v) Executive being disqualified from acting as a company director.
Notwithstanding the foregoing, a termination shall not be treated as a
Termination for Cause unless the Company shall have delivered a written notice
to Executive stating that it intends to terminate his employment for Cause and
specifying the factual basis for such termination, and the event or events
that form the basis for the notice, if capable of being cured, shall not have
been cured within 30 days of the receipt of such notice.
"Termination Without Cause" means any termination by the Company of
Executive's employment hereunder other than (i) a Termination due to
Disability, (ii) a Termination due to Retirement or (iii) a Termination for
Cause.
"Termination for Good Reason" means a termination of Executive's
employment by Executive within 90 days following (i) a reduction in
Executive's annual Base Salary or bonus opportunity contemplated by Sections
3(a) and (b), (ii) a material reduction in Executive's positions, duties,
responsibilities or reporting lines from those described in Section 2 or (iii)
a material breach of this Agreement by the Company. Notwithstanding the
foregoing, a termination shall not be treated as a Termination for
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Good Reason (x) if Executive shall have consented in writing to the occurrence
of the event giving rise to the claim of Termination for Good Reason or (y)
unless Executive shall have delivered a written notice to the Company within
30 days of his having actual knowledge of the occurrence of one of the events
specified in clause (i), (ii) or (iii) above stating that he intends to
terminate his employment for Good Reason and specifying the factual basis for
such termination, and such event, if capable of being cured, shall not have
been cured within 30 days of the receipt of such notice. Following a "Change
in Control", Executive shall not be deemed to have Good Reason under clause
(ii) above so long as he continues to have responsibility for managing
materially all of the Company's business in the geographical area that he was
managing at the time of the Change in Control.
"Change in Control" means the occurrence of (i) a sale or other
disposition of stock of the Company, or an issuance of stock of the Company as
a result of which any "person" (as such term is used in section 13(d) and
14(d) of the Securities Exchange Act of 1934), other than Xxxxxx X. Xxxxxx
("Lauder") is or becomes the beneficial owner of more than 25% of the total
voting power of the Company, and Lauder (x) beneficially owns a lesser
percentage of the total voting power of the Company than such other "person"
and (y), Lauder no longer has the right or ability by voting power, contract
or otherwise to elect or designate a majority of the Board of Directors, (ii)
any merger, consolidation or reorganization (a "Transaction") and Lauder no
longer has the right or ability by voting power, contract or otherwise to
elect or designate a majority of the Board of Directors, or (iii) more than
50% of the total value of the assets of the Company and its consolidated
subsidiaries are transferred and the transferee of such assets is not Lauder
or a company controlled by Lauder, or (iv) a complete liquidation of the
Company.
"Termination Without Good Reason" means any termination by Executive
of Executive's employment hereunder other than (i) a termination due to
Executive's death, (ii) a Termination due to Retirement, (iii) a Termination
for Good Reason, or (iv) a Termination due to Disability.
"Vested Benefits" means amounts which are vested or which Executive
is otherwise entitled to receive under the terms of or in accordance with any
plan, policy, practice or program of, or any contract or agreement with, the
Company, including the Option (to the extent provided in Section 3(c)), at or
subsequent to the date of his termination without regard to the performance by
Executive of further services or the resolution of a contingency and expenses
incurred prior to termination of employment that are reimbursable under
Section 4(c).
(f) Adjustment to Notice. The Company reserves the right to make a
payment in lieu of notice should it so wish, or require Executive to remain
away from work during
9
the notice period, whichever it may deem appropriate. Any payment in lieu of
notice will have any appropriate PAYE tax and National Insurance Contributions
deducted at source.
(g) Full Discharge of Company Obligations. The amounts payable to
Executive pursuant to this Section 5 following termination of his employment
(including amounts payable with respect to Vested Benefits) shall be in full
and complete satisfaction of Executive's rights under this Agreement and any
other claims he may have in respect of his employment by the Company or any of
its subsidiaries, including any damages or compensation in respect of any loss
of rights under any share option scheme in which Executive was entitled to
participate. Such amounts shall constitute liquidated damages with respect to
any and all such rights and claims and, upon Executive's receipt of such
amounts, the Company shall be released and discharged from any and all
liability to Executive in connection with this Agreement or otherwise in
connection with Executive's employment with the Company and its subsidiaries
and Affiliates, other than Executive's rights to indemnification under Section
4(e).
6. Agreement Not to Compete With Company
(a) During the Employment Period and for a period of nine months
thereafter, Executive shall not directly or indirectly own, manage, operate,
finance, join, control, advise, consult, render services to, have an interest
or future interest or participate in the ownership, management, operation,
financing or control of, or be employed by or connected in any manner with any
Competing Business (other than as a holder of common stock of the Company, and
not in excess of 1% of the outstanding voting shares of any other publicly
traded company). "Competing Business" means the business of international
telecommunication services in any country which is a member of the European
Union during the period of Executive's employment with the Company, where the
Company or an Affiliate conducts such business at any time during the Term,
other than the United Kingdom. Any opportunity directly or indirectly related
to any business engaged in by the Company, its subsidiaries and Affiliates of
which Executive becomes aware during the Term shall be deemed a corporate
opportunity of the Company, and Executive shall promptly make such opportunity
available to the Company.
(b) If, during the period of nine months after expiration of the
Employment Period, Executive proposes to engage directly or indirectly in what
may be a Competing Business, Executive shall so notify the Company in a
writing which shall fully set forth and describe in detail the nature of the
activity which may be a competitive Business, the names of the companies or
other entities with or for whom such activity is proposed to be engaged in by
Executive or by an Affiliate of Executive (the "Section 6 Notice"). If, within
30 days after receipt by the Company of a Section 6 Notice, the Company shall
fail to notify Executive that it deems the proposed activity to be a
Competitive Business, then
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Executive shall be free to engage in the activities described in the Section 6
Notice without violation of Section 6(a). If, however, the Company notifies
Executive that the proposed activities constitute a Competitive Business, then
(i) Executive shall not engage in such Competitive Business during the nine
month period following expiration of the Employment Period, and (ii) the
Company shall pay Executive, during such nine month period, in equal monthly
installments, an amount equal to his highest Base Salary; provided that the
amount payable under this Section 6(b) shall be reduced by the amount of
Severance Benefit that Executive is receiving for such period.
7. Confidential Information
(a) Without the prior written consent of the Company, Executive shall
not disclose at any time during the Employment Period or any time thereafter
any Confidential Information (as defined below) to any third person other than
in the course of fulfilling Executive's responsibilities under this Agreement
unless such Confidential Information has been previously disclosed to the
public by the Company or an Affiliate or is in the public domain (other than
by reason of Executive's breach of the provisions of this paragraph).
(b) "Confidential Information" is any non-public information
pertaining to the Company or an Affiliate, any of their businesses or the
business or personal affairs of Lauder or his family and how any of them
conducts its or his business or affairs. "Confidential Information" includes
not only information disclosed by the Company or an Affiliate to Executive,
but non-public information developed, created or learned by Executive during
the course of or as a result of Executive's employment with the Company.
"Confidential Information" specifically includes non-public information and
documents concerning the Company's and its Affiliates' methods of doing
business; research, telecommunications technology, its actual and potential
clients, transactions and suppliers (including the Company's or an Affiliate's
terms, conditions and other business arrangements with them); client or
potential client or transaction lists and billing; advertising, marketing and
business plans and strategies (including prospective or pending licensing
applications or investments in license holders or applicants); profit margins,
goals, objectives and projections; compilations, analyses and projections
regarding the Company, its Affiliates or any of its clients or potential
clients or their businesses; trade secrets; salary, staffing, management
organization or employment information; information relating to members of the
Board of Directors and management of the Company or an Affiliate; files,
drawings or designs; information regarding product development, marketing
plans, sales plans or manufacturing plans; operating policies or manuals,
business plans, financial records or packaging design; or any other non-public
financial, commercial, business or technical information relating to the
Company, an Affiliate, Lauder or his family or non-public information
designated as confidential or proprietary that the Company, an Affiliate or
Lauder may receive belonging to others who do business with any of them.
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(c) Nothing herein shall prevent the disclosure by Executive of any
information required by an order of a court having competent jurisdiction or
under subpoena from a government agency, provided that, if Executive receives
a request for the disclosure of any Confidential Information pursuant to court
process or by a government agency, Executive shall promptly (and at the latest
within five business days but not less than three days prior to the date
Executive is required to respond to the request) notify the Company of that
request and cooperate to the maximum extent authorized by law with the Company
in protecting the Company's and it Affiliates' interest in maintaining the
confidentiality of any Confidential Information. The Company will reimburse
Executive for reasonable out-of-pocket costs or expenses incurred by Executive
in connection with his cooperation with the Company and its Affiliates
hereunder.
8. No Disparaging Comments
Each of the parties hereto agrees not to make disparaging or derogatory
comments about the other party, members of the Board or Affiliates, except to
the extent required by law, and then only after consultation with the other
party to the maximum extent possible in order to maintain goodwill for each of
the parties.
9. Return of Company Property
Promptly (and at the latest within ten business days) following Executive's
termination of services, Executive shall:
(i) return to the Company all documents, records, notebooks,
computer diskettes and tapes and anything else containing
the Company's Confidential Information (as defined above),
and any other property or Confidential Information of the
Company or its Affiliates, including all copies thereof in
Executive's possession, custody or control, and
(ii) delete from any computer or other electronic storage medium
owned by Executive any of the proprietary or Confidential
Information of the Company or its Affiliates.
10. No Soliciting or Hiring Company Employees
During the Employment Period and for a twelve month period thereafter,
Executive shall not directly or indirectly induce any employee of the Company
or any Affiliate, other than Executive's secretary or personal assistant, to
terminate employment with such entity. Additionally, during the Employment
Period and for a one-year period thereafter, Executive shall not directly or
indirectly, either individually or as owner, agent, employee, consultant
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or otherwise, employ or offer employment to any person who is or was employed
by the Company or any Affiliate as an employee; provided, however, that
Executive shall not be deemed to have breached the provisions of this sentence
in the event that Executive had no prior knowledge of such hiring (or offer of
employment).
11. Continuing Obligations Following Termination
Executive agrees that his obligations and restrictions with respect to
noncompetition, confidentiality, Company property, nondisparagement and
nonsolicitation, and the Company obligations to indemnify Executive under
Section 4(d), will continue to apply following the termination of Executive's
relationship regardless of the manner in which his relationship with the
Company is terminated, whether voluntarily, for Cause, for Good Reason,
without Cause or otherwise.
12. Arbitration of All Disputes
Any dispute, controversy or claim arising out of, relating to or in connection
with this Agreement, or the breach, termination or validity thereof, shall be
finally settled by binding arbitration. The arbitration shall be held in
London England. Except to the extent inconsistent with this Agreement, the
arbitration shall be conducted in accordance with the Rules of the London
Court of International Arbitration ("LCIA") then in effect at the time of the
arbitration. The arbitration shall be conducted by one arbitrator who shall be
acceptable to both the Company and the Executive. If the parties cannot agree
on an acceptable arbitrator within 30 days, the dispute shall be heard by a
panel of three arbitrators, one appointed by each of the parties within 30
days thereafter and the third appointed by the other two arbitrators. If one
party names an arbitrator and the other fails to do so in the required time
period, the arbitrator so appointed shall act as sole arbitrator. If the two
arbitrators do not appoint a third arbitrator within 30 days after the last of
the two arbitrators has been appointed, the third arbitrator shall be
appointed by the LCIA. The arbitral award shall be in writing and shall be
final and binding on the parties. The award may include an award of costs,
including reasonable attorney's fees and disbursements, unless the arbitrators
conclude that matters of equity or important considerations of fairness
dictate otherwise. The parties expressly agree that leave to appeal under
Section 69(1) or an application for the determination of a preliminary point
of law under Section 45 of the Arbitration Act of 1996 may not be sought with
respect to any question of law arising from an award. Judgment upon the award
may be entered by any court having jurisdiction thereof or having jurisdiction
over the parties or their assets.
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13. Injunctive Relief to Avoid Irreparable Injury
(a) Executive acknowledges and agrees that the individualized
services and capabilities that he will provide to the Company under this
Agreement are of a personal, special, unique, unusual, extraordinary and
intellectual character.
(b) Executive acknowledges that because the international
telecommunications industry is globally integrated and that its constituent
companies are dependent for their survival on protection of their confidential
information which is highly advanced and technical and on carefully developed
knowledge of customer systems and requirements, the restrictions in this
agreement are reasonable to protect the Company's rights under this Agreement
and to safeguard the Company's and it Affiliates' Confidential Information.
(c) Executive acknowledges and agrees that the covenants and
obligations of Executive with respect to noncompetition, nonsolicitation,
confidentiality and Company property relate to special, unique and
extraordinary matters and that a violation of any of the terms of such
covenants and obligations will cause the Company and its Affiliates
irreparable injury for which adequate remedies are not available at law.
Executive therefore agrees that the Company shall be entitled to an order of
specific performance, injunction, restraining order or such other interim or
permanent equitable relief (without the requirement to post bond) restraining
Executive from committing any violation of the covenants and obligations
contained in this Agreement. Executive acknowledges and agrees that if any one
or more of any part of such restrictions shall be rendered or judged invalid
or unenforceable, such restriction or part shall be deemed to be severed from
this Agreement and such invalidity or unenforceability shall not in any way
affect the validity of the remaining provisions.
(d) These injunctive remedies are cumulative and are in addition to
any other rights and remedies the Company may have at law or in equity.
(e) Executive represents that his economic means and circumstances
are such that the provisions of this Agreement, including the noncompetition,
nonsolicitation, confidentiality and Company property provisions, will not
prevent him from providing for himself and his family on a basis satisfactory
to him and them.
14. Notices
All notices and other communications required or permitted hereunder shall be
sufficiently given if (a) delivered personally, (b) sent by facsimile
transmission (with confirmation received), (c) sent by a nationally-recognized
air courier assuring overnight delivery, or (d) mailed (by registered or
certified mail, return receipt requested and postage prepaid) as follows:
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if to the Executive, to the Executive at:
Xxxxx Xxxxx Xxxx
Xxxxx Xxxx
Xxxxxxx
Xxxxxx XX0 0XX
XXXXXXX
if to the Company, to the Company at
Xxxxxxxx Xxxxx
Xxxxxx Xxxxxx
Xxxxx Xxxxx
Xxxxxxxxx XX0 0XX
London, ENGLAND
with a copy to each of:
RSL COM North America, Inc.
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Corporate Counsel
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxxx, Esq.
or to such other address as shall be furnished by notice from time to time by
one party hereto to the other party. Any such communication shall be deemed to
have been given, (i) in the case of personal delivery, on the date of
delivery, (ii) in the case of delivery by air courier, on the first business
day following the day on which such communication was posted, and (iii) in the
case of mailing, on the third business day following the day on which such
notice was posted.
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15. Sole and Entire Understanding; Amendments
The entire understanding and agreement between the Company and Executive have
been incorporated into this Agreement. There are no other agreements,
promises, representations, understandings or inducements by the Company to
Executive or Executive to the Company other than those specifically set forth
in this Agreement. This Agreement may not be altered, amended or added to
except in a single writing signed by the Company and the Executive.
16. Waiver of Breach
A waiver or breach of any provision of this Agreement shall not constitute or
operate as a waiver of any other breach of such provision or of any other
provision, and any failure to enforce any provision hereof shall not operate
as a waiver of such provision or of any other provision.
17. Headings
The headings of sections in this Agreement are for convenience only, are not a
part of this Agreement and shall not affect the construction of the provisions
of this Agreement.
18. Arm's Length
(a) This Agreement was entered into at arm's length, without duress
or coercion, and is to be interpreted as an agreement between parties of equal
bargaining strength. Both the Company and the Executive agree that this
Agreement is clear and unambiguous as to its terms, and that no parol or other
evidence will be used or admitted to alter or explain the terms of this
Agreement, but that it will be interpreted based on the language within its
four corners in accordance with the purposes for which it is entered into.
(b) The parties hereto expressly agree that any rule or contractual
interpretation, as applied under California law or anywhere else, that would
allow parol or extrinsic evidence to attempt to show fraud in the inducement
or duress to contradict the plain, unambiguous terms of this Agreement shall
not apply to this Agreement and its performance and enforcement. This
provision is a material part of this Agreement and, should any party try to
introduce evidence contrary to this provision, any other party shall be
entitle to consider it a breach and to rescind this contract in full.
19. Successors and Assigns
(a) This Agreement will inure to the benefit of, and will be binding
upon, the Company, its successors and assigns and upon the Executive and his
heirs, successors and
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assigns; provided, however, that, because this is an Agreement for personal
services, the Executive cannot assign any of his obligations under this
Agreement to anyone else.
(b) This Agreement may be executed in counterparts, in which case
each of the two counterparts will be deemed to be an original.
20. English Law Governs
Any questions or other matters arising under this Agreement, whether of
validity, interpretation, performance or otherwise, will therefore be governed
by and construed in accordance with the laws of England.
IN WITNESS WHEREOF, this Agreement has been executed by Executive and
then by the Company on the dates shown below, but effective as of the date and
year first above written.
Date:
------------------ ------------------------------------
Xxxxxxx X. Xxxxxxxx
RSL COM Europe, Ltd.
Date: By:
------------------ ---------------------------------
Title:
------------------------------
Date: RSL COMMUNICATIONS, LTD., with respect to
------------------ any of its express obligations hereunder
By:
----------------------------------
Title:
-------------------------------
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